UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
☒
☐
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2021
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE
TRANSITION PERIOD FROM TO
Commission File Number: 001-33164
Domtar Corporation
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of
incorporation or organization)
234 Kingsley Park Drive
Fort Mill, SC
(Address of principal executive offices)
20-5901152
(I.R.S. Employer
Identification No.)
29715
(Zip Code)
Registrant’s telephone number, including area code: (803) 802-7500
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act: None
Indicate by check mark if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. YES ☐ NO ☒
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. YES ☒ NO ☐
Indicate 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 the preceding
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 past 90 days. YES ☒ NO ☐ *
*The Registrant is a voluntary filer and not subject to the filing requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934. Although not subject to these filing
requirements, the Registrant has filed all reports that would have been required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12
months had the Registrant been subject to such requirements.
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of
this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). YES ☒ NO ☐
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of
Registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See
the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Non-accelerated filer
Emerging growth company
☐
☒
☐
Accelerated filer
Small reporting company
☐
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting
under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☐
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ☐ NO ☒
The aggregate market value of the voting and non-voting common equity held by non-affiliates of the Registrant, based on the closing price of the shares of common stock on The
New York Stock Exchange on June 30, 2021, was $2,740,895,042
As of December 31, 2021, there are no longer publicly traded common shares of Domtar Corporation.
DOMTAR CORPORATION
ANNUAL REPORT ON FORM 10-K
FOR THE YEAR ENDED DECEMBER 31, 2021
TABLE OF CONTENTS
PART I
ITEM 1
BUSINESS
ITEM 1A
RISK FACTORS
ITEM 1B
UNRESOLVED STAFF COMMENTS
ITEM 2
PROPERTIES
ITEM 3
LEGAL PROCEEDINGS
ITEM 4
MINE SAFETY DISCLOSURES
ITEM 5
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER
PURCHASES OF EQUITY SECURITIES
PART II
ITEM 6
RESERVED
ITEM 7
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
ITEM 7A QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
ITEM 8
FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Management’s Reports to Shareholders of Domtar Corporation
Report of PricewaterhouseCoopers LLP, Independent Registered Public Accounting Firm (PCAOB ID: 238)
Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss)
Consolidated Balance Sheets
Consolidated Statement of Shareholders’ Equity
Consolidated Statements of Cash Flows
Notes to Consolidated Financial Statements
ITEM 9
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE
ITEM 9A
CONTROLS AND PROCEDURES
ITEM 9B OTHER INFORMATION
ITEM 10
DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
PART III
ITEM 11
EXECUTIVE COMPENSATION
ITEM 12
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS
ITEM 13
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
ITEM 14
PRINCIPAL ACCOUNTANT FEES AND SERVICES
ITEM 15
EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
Schedule II – Valuation and Qualifying Accounts
PART IV
ITEM 16
FORM 10-K SUMMARY
SIGNATURES
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PART I
ITEM 1. BUSINESS
Throughout this Annual Report on Form 10-K, unless otherwise specified, “Domtar Corporation,” “the Company,” “Domtar,” “we,” “us” and “our”
refer to Domtar Corporation, its subsidiaries, as well as its investments.
GENERAL
We design, manufacture, market and distribute a wide variety of fiber-based products, including communication papers, specialty and packaging papers.
The foundation of our business is a network of wood fiber converting assets that produce paper grade, fluff and specialty pulp. Approximately 60% of our
pulp production is consumed internally to manufacture paper, with the balance sold as market pulp. We are the largest integrated marketer of uncoated
freesheet paper in North America serving a variety of customers, including merchants, retail outlets, stationers, printers, publishers, converters and end-
users. To learn more, visit www.domtar.com.
Paper Excellence Acquired Domtar Corporation
On November 30, 2021, Paper Excellence completed the acquisition of all the outstanding common shares of Domtar Corporation (the “Company”) by
means of a merger of Pearl Merger Sub (a wholly-owned subsidiary) with and into the Company, with the Company continuing as the surviving
corporation and as a subsidiary of Paper Excellence (the “Merger”). Refer to Item 8, Financial Statements and Supplementary Data, under Note 4
“Acquisition of Businesses” for additional information on the Merger.
As a condition to obtain the approval of the Merger from the Canadian Competition Bureau, we were required to commit to the divestiture of our
Kamloops, British Columbia pulp mill, within a short period of time following the Merger. The assets and liabilities related to the pulp mill for all periods
are presented as held for sale in the Consolidated Balance Sheet. The sale of the pulp mill meets the criteria for discontinued operations and, as such,
earnings are included within Earnings (loss) from discontinued operations, net of taxes in the Consolidated Statement of Earnings (Loss) and
Comprehensive income (loss) for all periods presented. Refer to Item 8, Financial Statements and Supplementary Data, under Note 3 “Discontinued
Operations” for additional information on the Discontinued Operations.
Basis of Presentation
For purposes of Domtar's financial statement presentation, Pearl Merger Sub was determined to be the accounting acquirer in the Merger which was
accounted for using the acquisition method of accounting. The application of the acquisition method of accounting resulted in a new basis of accounting
basis of the Company’s assets and liabilities which are measured at fair value as of the date of the Merger. Domtar's Consolidated Financial Statements for
periods following the close of the Merger are labeled “Successor” and reflect the Company’s assets and liabilities at their fair value. All periods prior to the
closing of the Merger reflect the historical accounting basis of Domtar’s assets and liabilities and are labeled “Predecessor.” The Consolidated Financial
Statements and related Notes include a black line division between the columns titled "Predecessor" and "Successor" to signify that the amounts shown for
the periods prior to and following the Merger are not comparable.
Restart of the paper machine and converting operations at our Ashdown, Arkansas mill
On July 15, 2021, we announced our intention to restart a paper machine and the converting operations at our Ashdown, Arkansas mill to add an additional
185,000 tons per year of uncoated freesheet production capacity to our manufacturing network. This was necessary to meet growing customer demand as
the economy recovers from the COVID-19 pandemic. The additional paper capacity resulted in a capacity reduction of 185,000 ADMT per year of baled
SBSK pulp at the mill. The machine restarted in the fourth quarter of 2021 and is now in full operation.
Sale of Personal Care business
On March 1, 2021, we completed the sale of our Personal Care business to American Industrial Partners (AIP), for a purchase price of $920 million in cash.
Based on its magnitude and because we exited the Personal Care business, the sale represented a significant strategic shift that had a material effect on our
operations and financial results. Accordingly, all periods presented reflect the Personal Care business as a discontinued operation. Our Personal Care
business was previously disclosed as a separate reportable segment. For more information on our discontinued operations, refer to Item 8, Financial
Statements and Supplementary Data, under Note 3, “Discontinued Operations”.
3
Execution of our asset conversion roadmap
On August 7, 2020, we announced our decision to repurpose assets at our Kingsport, Tennessee facility, following a review of our manufacturing footprint.
This conversion is consistent with the roadmap that we made public in 2018. The previously announced multi-mill conversion roadmap is designed to
adjust our paper capacity to align with our customer demand. Through this process, we have identified up to four large scale paper mill repurposing
projects that can produce 2.5 million tons of containerboard and/or 570,000 ADMT of additional market softwood and fluff pulp. We plan to enter the
linerboard market with the conversion of our Kingsport paper machine. Once in full operation, the mill will produce and market approximately
600,000 tons annually of high-quality recycled linerboard and medium, providing us with a strategic footprint in a growing adjacent market. The
conversion is expected to be completed by the fourth quarter of 2022.
AVAILABILITY OF INFORMATION
In this Annual Report on Form 10-K, we incorporate by reference certain information contained in other documents filed with the Securities and Exchange
Commission (“SEC”) and we refer you to such information. We file annual, quarterly and current reports and other information with the SEC available on
the SEC’s website at www.sec.gov free of charge as soon as reasonably practicable after we have filed or furnished the above-referenced reports.
OUR BUSINESS OVERVIEW
Following the sale of our Personal Care business in the first quarter of 2021, we now operate as a single reportable segment as described below, which also
represents our only operating segment.
Pulp and Paper: Consists of the design, manufacturing, marketing and distribution of communication, specialty and packaging papers, as well as
softwood, hardwood and fluff pulps and high quality airlaid and ultrathin laminated cores.
Information regarding our reportable segment is included in Item 7, Management’s Discussion and Analysis of Financial Condition and Results of
Operations, as well as Item 8, Financial Statements and Supplementary Data under Note 22 “Segment Disclosures”. Geographic information is also
included under Note 22 of the Financial Statements and Supplementary Data.
4
PULP AND PAPER
Our Manufacturing Operations
We produce approximately 3.4 million metric tons of softwood, fluff and hardwood pulp at 10 mills. Approximately 60% of our pulp is consumed
internally to manufacture paper, with the balance being sold as market pulp. We also purchase limited papergrade pulp from third parties for specific grades
and to optimize the logistics of our pulp capacity while reducing transportation costs.
We are the largest integrated manufacturer and marketer of uncoated freesheet paper in North America. We have eight integrated pulp and paper mills
(six in the United States and two in Canada), with an annual paper production capacity of approximately 2.4 million tons of uncoated freesheet paper. Our
paper manufacturing operations are supported by eleven converting and forms manufacturing operations (including a network of eight plants located offsite
from our paper making operations). Approximately 70% of our paper production capacity is in the United States and 30% is in Canada.
We produce market pulp in excess of our internal requirements at our pulp and paper mills in Ashdown, Espanola, Hawesville, Windsor, Marlboro and
Nekoosa. We also produce papergrade, fluff and specialty pulps at our two stand-alone pulp mills in Dryden and Plymouth. We can sell
approximately 1.4 million metric tons of pulp per year depending on market conditions. Approximately 69% of our pulp production capacity is in the U.S.
and 31% is in Canada.
The table below lists our operating pulp and paper mills and their annual production capacity:
PRODUCTION FACILITY
Fiberline Pulp Capacity
Saleable
Paper
# lines
('000 ADMT) (1)
# machines
('000 ST) (2)
Uncoated freesheet
Ashdown, Arkansas (3)
Windsor, Quebec
Hawesville, Kentucky
Marlboro, South Carolina
Johnsonburg, Pennsylvania
Nekoosa, Wisconsin
Rothschild, Wisconsin
Espanola, Ontario
Total Uncoated freesheet
Pulp
Dryden, Ontario
Plymouth, North Carolina
Total Pulp
Total
Total Trade Pulp (4)
3
1
1
1
1
1
1
1
10
1
1
2
12
775
447
412
320
228
155
65
280
2,682
327
390
717
3,399
1,436
1
2
2
1
2
3
1
2
14
—
—
—
14
185
642
596
274
344
168
131
69
2,409
—
—
—
2,409
(1)
(2)
(3)
(4)
ADMT refers to an air dry metric ton and ST refers to short ton.
Paper capacity is based on an operating schedule of 360 days and the production at the winder.
On July 15, 2021, we announced our intention to restart the paper machine at our Ashdown, Arkansas mill to add an additional 185,000 tons per year of
uncoated freesheet production capacity to our manufacturing network. The paper machine restarted in the fourth quarter of 2021 and is reflected in the
table above.
Estimated third-party shipments dependent upon market conditions.
We plan to enter the containerboard market with the conversion of our Kingsport mill. Once in full operation, the mill will produce and market
approximately 600,000 tons annually of high-quality recycled linerboard and medium, providing us with a strategic footprint in a growing market. The
conversion is expected to be completed by the end of 2022.
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Our Raw Materials
The manufacturing of pulp and paper requires wood fiber, chemicals and energy. We discuss these three major raw materials used in our manufacturing
operations below.
Wood Fiber
United States pulp and paper mills
The fiber used by our pulp and paper mills in the U.S. is softwood and hardwood, both readily available in the market from multiple third-party sources.
The mills obtain fiber from a variety of sources, depending on their location. These sources include a combination of supply contracts, wood lot
management arrangements, advance stumpage purchases and spot market purchases.
Canadian pulp and paper mills
The fiber used at our Windsor pulp and paper mill is hardwood originating from a variety of sources, including purchases on the open market in Canada
and the U.S., contracts with Quebec wood producers’ marketing boards, public land where we have wood supply allocations and from Domtar’s private
lands. The softwood and hardwood fiber for our Espanola pulp and paper mill and the softwood fiber for our Dryden pulp mill are obtained from third
parties, directly or indirectly from public lands and through designated wood supply allocations. Access to harvesting fiber on public lands in Ontario and
Quebec is subject to licenses and review by the respective governmental authorities.
Chemicals
We use various chemical compounds in our pulp and paper manufacturing operations that we purchase, primarily on a centralized basis, through contracts
varying between one and ten years in length to ensure product availability. Most of the contracts have pricing that fluctuates based on prevailing market
conditions. For pulp manufacturing, we use numerous chemicals including caustic soda, sodium chlorate, sulfuric acid, lime and peroxide. For paper
manufacturing, we also use several chemical products including starch, precipitated calcium carbonate, optical brighteners, dyes and aluminum sulfate.
Energy
Our operations produce and consume substantial amounts of energy. Our primary energy sources include: biomass, natural gas and electricity.
Approximately 70% of the total energy required to manufacture our products comes from renewable fuels such as bark and spent pulping liquor, generated
as byproducts from our manufacturing processes. The remainder of the energy comes from smaller amounts of other fossil fuels and purchased steam
procured under supply contracts. Under most of these contracts, suppliers are committed to provide quantities within predetermined ranges that provide us
with our needs for a particular type of fuel at a specific facility. Most of these contracts have pricing that fluctuate based on prevailing market conditions.
Biomass and fossil fuels are consumed primarily to produce steam that is used in the manufacturing process and, to a lesser extent, to provide direct heat
used in the chemical recovery process.
We have cogenerating assets at all of our integrated pulp and paper mills, as well as hydro assets at three locations: Espanola, Nekoosa and Rothschild.
These generating assets produce approximately 68% of the electricity requirements of our manufacturing operations, with the balance supplied from local
utilities. Electricity is primarily used to drive motors, pumps and other equipment, as well as provide lighting.
Our Transportation
Transportation of wood fiber, chemicals and pulp into our mills is mostly done by rail and trucks, although barges are used in certain circumstances. We
rely on third parties for the transportation of our pulp and paper products between our mills, converting operations, distribution centers and customers. Our
paper products are shipped mostly by truck, with logistics operations and procurement being managed centrally in collaboration with each location. Our
pulp is either shipped by vessel, rail or truck depending on destination and customer preference. We work with major railroads, ocean carriers, and
approximately 300 trucking and third-party transportation companies in the U.S. and Canada. Service agreements are typically negotiated on an annual
basis. We pay diesel fuel surcharges, which vary depending on the mode of transportation used and the cost of diesel fuel.
6
Our Product Offering
Paper
Our uncoated freesheet papers are categorized into both communication papers and specialty and packaging papers. Communication papers are further
categorized into business papers and commercial printing and publishing papers.
Our business papers include copy and electronic imaging papers, which are used with inkjet and laser printers, photocopiers and plain-paper fax machines,
as well as computer papers, preprinted forms and digital papers. These products are primarily for office and home use. Business papers accounted for
approximately 48% of our shipments of paper products in 2021.
Our commercial printing and publishing papers include uncoated freesheet papers, such as offset papers and opaques. These uncoated freesheet grades are
used in sheet and roll fed offset presses across the spectrum of commercial printing end-uses, including digital printing. Our publishing papers include
tradebook and lightweight uncoated papers used primarily in book publishing applications such as textbooks, dictionaries, catalogs, magazines, hard cover
novels and financial documents. These products also include converting papers, such as envelopes, tablets, business forms and data processing/computer
forms. Commercial printing and publishing papers accounted for approximately 34% of our shipments of paper products in 2021.
Our specialty and packaging papers include papers used for thermal printing, flexible packaging, food packaging, medical packaging, medical gowns and
drapes, sandpaper backing, carbonless printing, labels and other papers used for coating and laminating applications. We also manufacture papers for
industrial and specialty applications including carrier papers, treated papers, security papers and specialized printing and converting applications. These
specialty and packaging papers accounted for approximately 18% of our shipments of paper products in 2021. These grades of papers require a certain
amount of innovation and agility in the manufacturing system.
We sell business papers primarily to paper stationers, merchants, office equipment manufacturers and retail outlets. We distribute uncoated commercial
printing and publishing papers to end-users and commercial printers, mainly through paper merchants, as well as selling directly to some end-users. We sell
our specialty and packaging papers mainly to converters, who apply a further production process such as coating, rewinding, folding or waxing to our
papers before selling them to a variety of specialized end-users.
Pulp
Our pulp products are comprised of softwood, fluff and hardwood kraft as well as high quality airlaid and ultrathin laminated cores. Our pulp grades are
sold to customers in approximately 50 countries worldwide and are used in a variety of end-products, such as diapers and personal hygiene products,
bathroom and facial tissue, specialty and packaging papers, customers who make printing and writing grades, building products and electrical insulating
papers. Our laminated cores are used in the manufacturing of baby diapers, adult incontinence and feminine hygiene products.
We sell market pulp to customers in North America mainly through a North American sales force, while sales to most overseas customers are made directly
or through commission agents. We maintain pulp supplies at strategically located warehouses, which allow us to respond to customer orders on short
notice.
Our Customers
Our ten largest customers represented approximately 46% of our sales in 2021. In 2021, Staples represented approximately 12% of our sales. The majority
of our customers purchase products through individual purchase orders. In 2021, approximately 76% of our sales were in the United States, 10% were in
Canada, and 14% were in other countries.
OUR COMPETITION
The markets in which our businesses operate are highly competitive with well-established domestic and foreign manufacturers.
In the paper business, our paper production does not rely on proprietary processes or formulas, except in highly specialized papers or customized products.
In uncoated freesheet, we compete primarily on the basis of product quality, breadth of offering, service solutions and competitively priced paper products,
which include an extensive offering of high-quality Forest Stewardship Council (“FSC”)-certified paper products. While we have a leading position in the
North American uncoated freesheet market, we also compete with other paper grades, including coated freesheet, and with electronic transmission and
document storage alternatives. As the use of these alternative products continues to grow, we continue to see a decrease in the overall demand for paper
products. All of our pulp and paper manufacturing facilities are located in the U.S. or in Canada where we sell approximately 86% of our products. The five
largest manufacturers of uncoated freesheet papers in North America (including Domtar) represent approximately 80% of total production capacity. On a
global basis, there are hundreds of manufacturers that produce and sell uncoated freesheet paper. The
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level of competitive pressures from foreign producers in the North American market is highly dependent upon exchange rates, particularly the rate between
the U.S. dollar and the Euro as well as the U.S. dollar and the Brazilian real.
The pulp we sell is fluff, softwood or hardwood pulp. The pulp market is highly fragmented with many manufacturers competing worldwide. Competition
is primarily on the basis of product quality and competitively priced pulp products. The fluff pulp we sell is used in absorbent products, incontinence
products, diapers and feminine hygiene products. The softwood and hardwood pulp we sell is slow growth northern bleached softwood and hardwood kraft,
and we produce specialty engineered pulp grades with a predetermined mix of wood species. Our softwood and hardwood pulps are sold to customers that
make a variety of products for specialty paper, packaging, tissue and industrial applications, and customers who make printing and writing grades. Airlaid
and ultrathin laminated cores are highly customized and specialized for customer needs and have a relatively long and technical development, qualification
and sales process. We also seek product differentiation through the certification of our pulp mills to the FSC chain-of-custody standard and the procurement
of FSC-certified virgin fiber. All of our pulp production capacity is located in the U.S. or in Canada, and we sell approximately 54% of our pulp to other
countries.
OUR HUMAN CAPITAL
We have approximately 6,100 employees, 64% are employed in the United States and 36% in Canada. 58% of our employees are covered by collective
bargaining agreements, generally on a facility-by-facility basis.
We are committed to fostering a workplace that attracts and retains talent. Through ongoing employee development, comprehensive compensation and
benefits, and a focus on health, safety, employee well-being and community engagement, we aim to directly influence positive work behavior and on-the-
job performance.
Diversity and Inclusion
Although we have a strict non-discrimination and anti-harassment policy, we view diversity and inclusion as more than just policies and practices. It is part
of who we are, how we operate, and essential to our long-term sustainability. We strive to create an inclusive workplace where people can bring their
authentic selves to work and feel valued and included.
Our commitment to diversity and inclusion starts at the top with a highly skilled and diverse senior leadership. We are committed to increasing
representation of women and underrepresented minorities at Domtar overall, but particularly in leadership roles. The Domtar Diversity and Inclusion
Council provides guidance to leadership to help make Domtar more inclusive and diverse.
To ensure leadership maintains a commitment to diversity and inclusion, each leader is responsible for focusing on how they can develop and support
diversity within the workplace and within their scope of responsibilities.
Compensation and Pay Equity
Our compensation program is designed to attract and reward talented individuals who possess the skills necessary to support our business objectives, assist
in the achievement of our strategic goals and create long-term value. We believe people should be paid for what they do and how they do it, regardless of
their gender, race, or other personal characteristics. To deliver on that commitment, we benchmark, and set pay ranges based on market data and consider
factors such as an employee’s role, experience and performance. We also regularly review our compensation practices, both in terms of our overall
workforce and individual employees, to ensure our pay is fair and equitable.
Learning and Development
Hiring, developing and retaining employees is important to our operations and we are focused on creating experiences and programs that foster growth,
performance and retention. We continually invest in our employees’ career growth and provide a wide range of development opportunities, including face-
to-face, virtual, social and on-site learning, mentoring, coaching, and external development.
Health and Safety
The physical health, life balance and mental health of our employees is part of our core value of caring and thus is of vital importance to Domtar. That is
why we work relentlessly to physically eliminate the potential for life-altering hazards and minimize risk of injury as part of a proactive, preventive safety
culture while investing in well-being programs to help our employees establish and maintain healthy lifestyles.
Throughout the COVID-19 pandemic, we have remained focused on protecting the health, safety, and well-being of our employees while meeting the needs
of our customers. Shortly after the outset of COVID-19, we adopted enhanced safety measures and practices across our facilities to protect employee health
and safety and ensured a reliable supply of essential products to our customers. We monitor the impact of the pandemic on our employees and within our
operations, and proactively modify or adopt new practices to promote their health and safety.
8
Community Involvement
We make donations to charitable organizations in the communities where we live and work and believe that this commitment helps in our efforts to attract
and retain employees. We also offer employees the opportunity to volunteer in their communities through our Domtar EarthChoice Ambassadors program.
We focus our philanthropic efforts on three areas that align with our business: literacy, sustainability, and health and wellness.
OUR APPROACH TO SUSTAINABILITY
Domtar aims to deliver value to our customers, employees and communities by viewing our business decisions within the larger context of sustainability.
We take a long-term view on managing natural resources for the future. We strive to minimize waste and encourage recycling. We aim to have the highest
standards for ethical conduct, for caring about the health and safety of each other, and for maintaining the environmental quality in the communities where
we live and work. We value the partnerships we have formed with non-governmental organizations and believe they make us a better Company. We focus
on agility to respond to new opportunities, and we are committed to turning innovation into value creation. By embracing sustainability as our operating
philosophy, we seek to internalize the fact that the choices we have and the impact of the decisions we make on our stakeholders are all interconnected. We
believe that our business and the people and communities who depend on us are better served as we weave this focus on sustainability into the things we
do.
Domtar executes this commitment to sustainability at every level and every location across the Company. Our Management Committee empowers senior
managers from manufacturing, technology, finance, sales and marketing and corporate staff functions to regularly come together and establish key
sustainability performance metrics, and to routinely assess and report on progress. Our sustainability goals, challenges and progress are reported annually
on the Company’s website and other published reports.
OUR ENVIRONMENTAL COMPLIANCE
Our business is subject to a wide range of general and industry-specific laws and regulations in the U.S. and other countries where we have operations,
relating to the protection of the environment, including those governing wood harvesting, air emissions, climate change, waste water discharges, storage,
management and disposal of hazardous substances and wastes, contaminated sites, landfill operation and closure obligations and health and safety matters.
Compliance with these laws and regulations is a significant factor in the operation of our business. We may encounter situations in which our operations
fail to maintain full compliance with applicable environmental requirements, possibly leading to civil or criminal fines, penalties or enforcement actions,
including those that could result in governmental or judicial orders that stop or interrupt our operations or require us to take corrective measures at
substantial costs, such as the installation of additional pollution control equipment or other remedial actions.
Compliance with environmental laws and regulations involves capital expenditures as well as additional operating costs. Additional information regarding
environmental matters is included in Item 8, Financial Statements and Supplementary Data, under Note 20 “Commitments and Contingencies” and in
Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations, under the section of Critical accounting estimates and
policies, under the caption “Environmental Matters and Asset Retirement Obligations.”
OUR INTELLECTUAL PROPERTY
Many of our brand name products are protected by registered trademarks. Our key trademarks include Cougar®, Lynx® Opaque Ultra, Husky® Opaque
Offset, First Choice®, EarthChoice®, Ariva®, NovaThin® and NovaZorb®. These brand names and trademarks are important to our business. Our
numerous trademarks have been registered in the U.S. and/or in other countries where our products are sold. The current registrations of these trademarks
are effective for various periods of time. These trademarks may be renewed periodically, provided that we, as the registered owner, and/or licensee comply
with all applicable renewal requirements, including the continued use of the trademarks in connection with similar goods.
We own U.S. and foreign patents and have several pending patent applications. Our management regards these patents and patent applications as important
but does not consider any single patent or group of patents to be materially important to our business as a whole.
9
OUR EXECUTIVE OFFICERS
Name
John D. Williams
Age
67
Daniel Buron
James Edwards
Robert Melton
58
57
50
Position and Business Experience
President and Chief Executive Officer of the Company since January 2009. He is
also a member of the Management Committee and the Domtar Advisory
Committee.
Mr. Williams has more than 40 years of experience in both consumer products and
packaging. He began his career in consumer product sales in 1976, gaining insight
into key market dynamics in the U.K. and the U.S. Since joining Domtar, he has
led the company’s transformation from a strictly paper manufacturing enterprise to
an emerging packaging player in the containerboard market.
Mr. Williams is a member of the Board of Directors of Owens Corning and the
Executive Chairman of the Board of Directors of Form Technologies, Inc., a
privately held leading global group of precision component manufacturers based
in Charlotte, North Carolina.
Executive Vice President and Chief Financial Officer of the Company since March
2007. He is also a member of the Management Committee. Mr. Buron was
previously Senior Vice-President and Chief Financial Officer of Domtar Inc. since
May 2004. He joined Domtar Inc. in 1999. Prior to May 2004, he was Vice
President, Finance, Pulp and Paper sales division and, prior to September 2002, he
was Vice President and Controller. He has over 30 years of experience in finance.
Mr. Buron is a Director of the McGill University Health Centre Foundation and
also serves on the Board of Directors of Nouveau Monde Graphite Inc.
Senior Vice President, Pulp and Paper Operations and member of the Management
Committee. Mr. Edwards has been with Domtar since 1996 and has held several
mill and corporate positions including Vice President of Pulp and Paper
manufacturing services team, general manager of our pulp and paper mill in
Marlboro (Bennettsville), South Carolina, operations manager, linerboard and fluff
pulp manager, and recycled linerboard superintendent. He is on the National
Council for Air and Stream Improvement Board of Governors and on Western
Michigan University’s Board of Trustees for their Paper Technology Foundation.
Senior Vice President, Pulp and Paper Commercial and member of the
Management Committee. Mr. Melton has been with Domtar since 1993. He has
held multiple roles in the communication and specialty papers at Domtar. He
serves as Chair of the Printing & Writing Committee of the American Forest and
Paper Association, is on the Board of Directors of the Envelope Manufacturers
Association Foundation and is also on the Board of Directors of the Paper &
Packaging Board.
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FORWARD-LOOKING STATEMENTS
This Annual Report on Form 10-K contains forward-looking statements relating to trends in, or representing management’s beliefs about, Domtar
Corporation’s future growth, results of operations, performance, liquidity and business prospects and opportunities. These forward-looking statements are
generally denoted by the use of words such as “anticipate,” “believe,” “expect,” “intend,” “aim,” “target,” “plan,” “continue,” “estimate,” “project,” “may,”
“will,” “should” and similar expressions. These statements reflect management’s current beliefs and are based on information currently available to
management. Forward-looking statements are necessarily based upon a number of estimates and assumptions that, while considered reasonable by
management, are inherently subject to known and unknown risks and uncertainties and other factors that could cause actual results to differ materially from
historical results or those anticipated. Accordingly, no assurances can be given that any of the events anticipated by the forward-looking statements will
occur, or if any occur, what effect they will have on our results of operations or financial condition. These factors include, but are not limited to:
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continued decline in usage of fine paper products in our core market;
our ability to implement our business diversification initiatives, including repurposing of assets and strategic acquisitions or divestitures,
including facility closures;
failure to achieve our cost containment goals, conversion costs in excess of our expectations and demand for linerboard;
product selling prices;
raw material prices, including wood fiber, chemical and energy;
conditions in the global capital and credit markets, and the general economy, particularly in the U.S., and Canada;
performance of our manufacturing operations, including unexpected maintenance requirements;
the level of competition from domestic and foreign producers;
cyberattacks or other security breaches;
the effect of, or change in, forestry, land use, environmental and other governmental regulations and accounting regulations;
the effect of weather and the risk of loss from fires, floods, windstorms, hurricanes and other natural disasters;
transportation costs;
the loss of current customers or the inability to obtain new customers;
legal proceedings;
changes in asset valuations, including impairment of long-lived assets, inventory, accounts receivable or other assets or other reasons;
changes in currency exchange rates, particularly the relative value of the U.S. dollar to the Canadian dollar;
performance of pension fund investments and related derivatives, if any;
a material disruption in our supply chain, manufacturing, distribution operations or customer demand such as public health crises that impact
trade or the general economy, including COVID-19 and other viruses, diseases or illnesses; and
the other factors described under “Risk Factors,” Item 1A.
You are cautioned not to unduly rely on such forward-looking statements, which speak only as of the date made, when evaluating the information presented
in this Annual Report on Form 10-K. Unless specifically required by law, Domtar Corporation disclaims any obligation to update or revise these forward-
looking statements to reflect new events or circumstances.
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ITEM 1A. RISK FACTORS
You should carefully consider the risks described below in addition to the other information presented in this Annual Report on Form 10-K.
Risks Related to our Business
Failure to successfully implement the Company’s business diversification initiatives could have a material adverse effect on its business, results of
operations and financial position.
The Company is pursuing strategic initiatives that management considers important to our long-term success. The intent of these initiatives is to help grow
and diversify the business and counteract the secular decline in our North American paper business. These initiatives may involve organic growth,
conversion of assets, select joint ventures and strategic acquisitions. The success of these initiatives will depend on, among other things, our ability to
identify potential strategic initiatives, understand the key trends and principal drivers affecting those businesses and to execute the initiatives in a cost-
effective manner. There are significant risks involved with the execution of such initiatives, including significant business, economic and competitive
uncertainties, many of which are outside the Company’s control.
For example, we are currently converting one of our mills to a containerboard production facility and in the past, we have converted paper mills to fluff
pulp production facilities. If circumstances warrant, in the future we may again convert mills to produce pulp or other products. Conversions can be capital
intensive and can involve the shutdown of a facility for an extended period of time, followed by an extended ramp-up and customer certification process. In
addition, the success of a conversion depends upon demand over time for the new product relative to the previously produced paper products, as well as
costs and other factors, and there can be no assurance that a conversion will be as successful as expected.
Strategic acquisitions may expose the Company to additional risks. The Company may have to compete for acquisition targets and any acquisition it makes
may fail to accomplish our strategic objectives or may not perform as expected. In addition, the costs of integrating an acquired business may exceed our
estimates and may require significant time and attention from senior management. Accordingly, the Company cannot predict whether it will succeed in
implementing these strategic initiatives. If it fails to successfully diversify our business, it may have a material adverse effect on the Company’s
competitive position, financial condition and operating results.
The Company’s paper products are vulnerable to long-term declines in demand due to competing technologies or materials.
The Company’s paper business competes with electronic transmission and document storage alternatives, as well as with paper grades it does not produce,
such as uncoated groundwood. As a result of such competition, the Company is experiencing ongoing decreasing demand for most of its existing paper
products. As the use of these alternatives grows, demand for paper products is likely to decline further. Declines in demand for our paper products may
adversely affect the Company’s business, results of operations and financial position.
The pulp and paper industry is highly cyclical. Fluctuations in the prices of and the demand for the Company’s pulp and paper products could result in
lower sales and profit.
The pulp and paper industry is highly cyclical. Historically, economic and market shifts, fluctuations in capacity and changes in foreign currency exchange
rates have created cyclical changes in prices, sales volume and margins for the Company’s pulp and paper products. The length and magnitude of industry
cycles have varied over time and by product, but generally reflect changes in macroeconomic conditions and levels of industry capacity. Most of the
Company’s paper products are commodities that are widely available from other producers. Because commodity products have few distinguishing qualities
from producer to producer, competition for these products is based primarily on price, which is determined by supply relative to demand.
The overall levels of demand for the pulp and paper products that the Company manufactures and distributes, and consequently its sales and profitability,
reflect fluctuations in levels of end-user demand, which depend in part on general macroeconomic conditions in North America and worldwide, the
continuation of the current level of service and cost of postal services, competition from electronic substitution, as well as the occurrence of a contagious
disease or illness, including COVID-19. See “Conditions in the global political and economic environment, including the global capital and credit markets,
can adversely affect the Company’s business, results of operations and financial position”, “The Company’s paper products are vulnerable to long-term
declines in demand due to competing technologies or materials” and “A global pandemic (or any disease outbreak, including epidemics, pandemics, or
similar widespread public health concerns such as the recent COVID-19 pandemic) could have a material adverse effect on the Company’s business
operations, results of operations, cash flows and financial position”.
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Industry supply of pulp and paper products is also subject to fluctuation, as changing industry conditions can influence producers to idle or permanently
close individual machines or entire mills. Such closures can result in significant cash and/or non-cash charges. In addition, to avoid substantial cash costs in
connection with idling or closing a mill, some producers will choose to continue to operate at a loss, sometimes even a cash loss, which can prolong weak
pricing environments due to oversupply. Oversupply also can result from producers introducing new capacity in response to favorable pricing trends or
low-cost imports in response to exchange rates and other factors.
Industry supply of pulp and paper products is also influenced by overseas production capacity, which has grown in recent years and is expected to continue
to grow.
As a result, prices for all of the Company’s pulp and paper products are driven by many factors outside of its control, and the Company has little influence
over the timing and extent of price changes, which are often volatile. Because market conditions beyond the Company’s control determine the prices for its
commodity products, the price for any one or more of these products may fall below its cash production costs, requiring the Company to either incur cash
losses on product sales or cease production at one or more of its pulp and paper manufacturing facilities. If the prices or demand for its pulp and paper
products decline, this could adversely affect the Company’s results of operations and financial position.
The Company relies heavily on a small number of significant customers, including one customer that represented approximately 12% of the Company’s
sales in 2021. A significant change in customer relationships or in customer demand for our products could materially adversely affect the Company’s
business, financial condition or results of operations.
The Company heavily relies on a small number of significant customers. The Company’s largest customer, Staples, represented approximately 12% of the
Company’s sales in 2021. A significant reduction in sales to any of the Company’s key customers could materially adversely affect the Company’s
business, financial condition or results of operations.
The Company may have difficulty obtaining wood fiber at favorable prices, or at all.
Wood fiber is the principal raw material used by the Company’s Pulp and Paper business, comprising approximately 23% of the cost of sales in 2021.
Wood fiber is a commodity, and prices historically have been impacted by a variety of factors. The primary source for wood fiber is timber. Environmental
litigation and regulatory developments, alternative use for energy production and reduction in harvesting related to the housing market, have caused, and
may cause in the future, significant reductions in the amount of timber available for commercial harvest in the U.S. and Canada. In addition, future
domestic or foreign legislation and litigation concerning the use of timberlands, the protection of endangered species, the promotion of forest health and the
response to and prevention of catastrophic wildfires could also affect timber supplies. Availability of harvested timber may be further limited by adverse
weather, fire, insect infestation, disease, ice storms, windstorms, flooding and other natural and man-made causes, thereby reducing supply and increasing
prices. Wood fiber pricing is subject to regional market influences, and the Company’s cost of wood fiber may increase in particular regions due to market
shifts in those regions. Any sustained increase in wood fiber prices would increase the Company’s operating costs, and the Company may be unable to
increase prices for its products in response to increased wood fiber costs due to additional factors affecting the demand or supply of these products.
The Company currently meets its wood fiber requirements by purchasing wood fiber from third parties and by harvesting timber pursuant to its forest
licenses and forest management agreements. If the Company’s cutting rights, pursuant to its forest licenses or forest management agreements are reduced,
or any third-party supplier of wood fiber stops selling or is unable to sell wood fiber to the Company, its financial condition or results of operations could
be materially and adversely affected.
An increase in the cost of the Company’s purchased energy or other raw materials would lead to higher manufacturing costs, thereby reducing its
margins.
The Company’s operations consume substantial amounts of energy such as biomass, natural gas and electricity. Energy prices, particularly for electricity,
natural gas and fuel oil, have been volatile in recent years. As a result, fluctuations in energy prices will impact the Company’s manufacturing costs and
contribute to earnings volatility. While the Company purchases substantial portions of its energy under supply contracts, most of these contracts are based
on market pricing.
Other raw materials the Company uses include various chemical compounds, such as precipitated calcium carbonate, sodium chlorate, sulfuric acid,
peroxide, and methanol. The costs of these other raw materials have been volatile historically, and they are influenced by capacity utilization, energy prices
and other factors beyond the Company’s control.
Due to the commodity nature of the Company’s products, the relationship between supply and demand for these products, rather than changes in the cost of
raw materials or purchased energy, will determine the Company’s ability to increase prices. Consequently, the Company may be unable to pass on increases
in its operating costs to its customers. Any sustained increase in raw material or energy
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prices without any corresponding increase in product pricing would reduce the Company’s operating margins and may have a material adverse effect on its
business and results of operations.
The Company depends on third parties for transportation services.
The Company relies on third parties for transportation of the products it manufactures and/or distributes, as well as delivery of its raw materials. In
particular, a significant portion of the goods it manufactures and raw materials it uses are transported by railroad, trucks or barges. If any of its third-party
transportation providers were to fail to deliver the goods that the Company manufactures or distributes in a timely manner, the Company may be unable to
sell those products at full value, or at all. Similarly, if any of these providers were to fail to deliver raw materials to the Company in a timely manner, it may
be unable to manufacture its products in response to customer demand. In addition, if any of these third parties were to cease operations or cease doing
business with the Company, it may be unable to replace them at reasonable cost. Any failure of a third-party transportation provider to deliver raw materials
or finished products in a timely manner could harm the Company’s reputation, negatively impact its customer relationships and may have a material
adverse effect on its financial condition and results of operations.
The Company could experience disruptions in operations and/or increased labor costs due to labor disputes.
Approximately 58% of the Company’s employees are represented by unions through collective bargaining agreements generally negotiated on a facility-by-
facility basis. In the future, the Company may not be able to negotiate acceptable new collective bargaining agreements, which could result in strikes or
work stoppages or other labor disputes by affected workers. Renewal of collective bargaining agreements could also result in higher wages or benefits paid
to union members. In addition, labor organizing activities could occur at any of the Company’s facilities. Therefore, the Company could experience a
disruption of its operations or higher ongoing labor costs, which could have a material adverse effect on its business and results of operations.
A material disruption in the Company supply chain, manufacturing or distribution operations could prevent it from meeting customer demand, reduce
its sales and/or negatively impact its results of operations.
The Company’s ability to manufacture, distribute and sell products is critical to its operations. These activities are subject to inherent risks such as:
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unscheduled maintenance outages;
prolonged power failures;
equipment failure;
chemical spill or release;
malfunction of a boiler;
the effect of a drought or reduced rainfall on its water supply;
labor disputes;
government regulations;
disruptions in the transportation infrastructure, including roads, bridges, railroad tracks and tunnels;
adverse weather, fires, floods, earthquakes, hurricanes or other catastrophes;
cyberattack or other security breaches;
failure of our IT systems, including any failure of our current systems and/or as a result of transitioning to additional or replacement IT
system;
public health crises that impact trade or the general economy, including COVID-19 and other viruses, diseases or illnesses;
terrorism or threats of terrorism, acts of war; or
other operational problems, including those resulting from the risks described in this section.
Events such as those listed above could disrupt the Company’s supply chain and impair its ability to manufacture or sell its products and have resulted in
operating losses in the past. Any interruption or facility damage could prevent the Company from meeting customer demand for its products as well as
require additional resources and/or require unplanned expenditures. If one or more of
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these machines or facilities were to incur significant downtime, it may have a material adverse effect on the Company’s results of operations and financial
position.
The Company could encounter difficulties restructuring operations or closing or disposing of facilities or business.
The Company is continuously seeking the most cost-effective means and structure to serve our customers and to respond to changes in our markets.
Accordingly, from time to time, the Company has, and is likely to again close facilities, sell non-core assets and otherwise restructure operations in an
effort to improve cost competitiveness and profitability. As a result, restructuring and divestiture costs have been, and are expected to be, a recurring
component of our operating costs, and may vary significantly from year to year depending on the scope of such activities. Divestitures and restructuring
may also result in significant financial charges for the impairment of assets, including intangible assets. Furthermore, such activities may divert the
attention of management, disrupt our ordinary operations, or result in a reduction in the volume of products produced and sold. There is no guarantee that
any such activities will achieve their goals, and if the Company cannot successfully manage the associated risks, its financial condition and results of
operations could be adversely affected.
Legal and Regulatory Risks
The Company could incur substantial costs as a result of compliance with, violations of or liabilities under applicable environmental laws and
regulations. It could also incur costs as a result of asbestos-related personal injury litigation.
The Company is subject to a wide range of general and industry-specific laws and regulations in the U.S. and other countries where we have operations,
relating to the protection of the environment and natural resources, including those governing air emissions, greenhouse gases and climate change,
wastewater discharges, harvesting, silvicultural activities, storage, management and disposal of hazardous substances and wastes, the cleanup of
contaminated sites, landfill operation and closure obligations, forestry operations and endangered species habitat, and health and safety matters. In
particular, the pulp and paper industry in the U.S. is subject to the United States Environmental Protection Agency’s (“EPA”) Cluster Rules.
The Company has incurred, and expects that it will continue to incur, significant capital, operating and other expenditures complying with applicable
environmental laws and regulations as a result of remedial obligations. The Company incurred $40 million of operating expenses and $5 million of capital
expenditures in connection with environmental compliance and remediation in 2021. As of December 31, 2021, the Company had a provision of
$41 million for environmental expenditures, including certain asset retirement obligations (such as for landfill capping).
The Company could also incur substantial costs, such as civil or criminal fines, sanctions and enforcement actions (including orders limiting its operations
or requiring corrective measures, installation of pollution control equipment or other remedial actions), cleanup and closure costs, and third-party claims for
property damage and personal injury as a result of violations of, or liabilities under, environmental laws and regulations. The Company’s ongoing efforts to
identify potential environmental concerns that may be associated with its past and present properties may lead to future environmental investigations.
Those efforts may result in the determination of additional environmental costs and liabilities which cannot be reasonably estimated at this time.
As the owner and operator of real estate, the Company may be liable under environmental laws for cleanup, closure and other damages resulting from the
presence and release of hazardous substances, including asbestos, on or from its properties or operations, including properties that it no longer owns. The
amount and timing of environmental expenditures is difficult to predict, and, in some cases, the Company’s liability may be imposed without regard to
contribution or to whether it knew of, or caused, the release of hazardous substances and may exceed forecasted amounts or the value of the property itself.
The discovery of additional contamination or the imposition of additional cleanup obligations at the Company’s or third-party sites may result in significant
additional costs. Any material liability the Company incurs could adversely impact its financial condition or preclude it from making capital expenditures
that would otherwise benefit its business.
In addition, the Company may be subject to asbestos-related personal injury litigation arising out of exposure to asbestos on or from its properties or
operations and may incur substantial costs as a result of any defense, settlement, or adverse judgment in such litigation. The Company may not have access
to insurance proceeds to cover costs associated with asbestos-related personal injury litigation.
Enactment of new environmental laws or regulations or changes in existing laws or regulations (such as changes in climate change regulation), or
interpretation thereof, might require significant expenditures. For additional information, refer to Item 8, Financial Statements and Supplementary Data,
under Note 20 “Commitments and Contingencies”. The Company may be unable to generate funds or other sources of liquidity and capital to fund
environmental liabilities or expenditures.
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Failure to comply with applicable laws and regulations could have a material adverse effect on our business, financial results or condition.
In addition to environmental laws, the Company’s business and operations are subject to a broad range of other laws and regulations in the U.S. and Canada
as well as other jurisdictions in which the Company operates, including antitrust and competition laws, occupational health and safety laws, and
employment laws. Many of these laws and regulations are complex and subject to evolving and differing interpretation. If the Company is determined to
have violated any such laws or regulations, whether inadvertently or willfully, it may be subject to civil and criminal penalties, including substantial fines,
loss of authorizations to participate in or exclusion from government programs, claims for damages by third parties or fines or monetary penalties which
may have a material adverse effect on the Company’s financial position, results of operations or cash flows. For additional information, refer to Item 8,
Financial Statements and Supplementary Data, under Note 20 “Commitments and Contingencies.”
Financial Risks
The Company may incur substantially more debt. This could increase risks associated with its leverage.
The Company may incur substantial additional indebtedness in the future. Although the Company’s debt agreements contain restrictions on the incurrence
of additional secured and unsecured indebtedness, these restrictions are subject to a number of qualifications and exceptions, and additional indebtedness
incurred in compliance with these restrictions could be substantial. Refer to Item 8, Note 17 “Long-term debt”, of this Annual Report on Form 10-K for
more details.
The Company’s operations require substantial capital, and it may not have adequate capital resources to provide for all of its capital requirements.
The Company’s businesses are capital intensive and require ongoing capital expenditures in order to maintain its equipment, increase its operating
efficiency and comply with environmental laws. In 2021, the Company’s total capital expenditures were $309 million.
If the Company’s available cash resources and cash generated from operations are not sufficient to fund its operating needs and capital expenditures, the
Company would have to obtain additional funds from borrowings or other available sources or reduce or delay its capital expenditures. The Company may
not be able to obtain additional funds on favorable terms, or at all. In addition, the Company’s debt service obligations will reduce its available cash flows.
If the Company cannot maintain or upgrade its equipment as it requires or allocate funds to ensure environmental compliance, it could be required to curtail
or cease some of its manufacturing operations, or it may become unable to manufacture products that compete effectively in one or more of its product
lines.
The Company’s ability to generate the significant amount of cash needed to pay interest and principal on the Company’s secured and unsecured long-
term indebtedness and service its other debt and financial obligations and its ability to refinance all or a portion of its indebtedness or obtain additional
financing depends on many factors beyond the Company’s control.
In 2021, the Company paid approximately $53 million in interest payments. The Company’s ability to make payments on and refinance its debt, including
the Company’s secured and unsecured long-term notes, its First Lien Term Loan Facility and amounts borrowed under its ABL Revolving Credit Facility, if
any, and other financial obligations and to fund its operations will depend on its ability to generate substantial operating cash flow. The Company’s cash
flow generation will depend on its future performance, which will be subject to prevailing economic conditions and to financial, business and other factors,
many of which are beyond its control.
The Company’s business may not generate sufficient cash flow from operations and future borrowings may not be available to the Company under its ABL
Revolving Credit Facility or otherwise in amounts sufficient to enable the Company to service its indebtedness, including the Company’s secured and
unsecured long-term notes, its First Lien Term Loan Facility and borrowings, if any, under its ABL Revolving Credit Facility or to fund its other liquidity
needs. If the Company cannot service its debt, the Company will have to take actions such as reducing or delaying capital investments, selling assets,
restructuring or refinancing its debt or seek additional equity capital. Any of these remedies may not be executed on commercially reasonable terms, or at
all, and may impede the implementation of its business strategy. Furthermore, the secured and unsecured long-term notes, the First Lien Term Loan Facility
and the ABL Revolving Credit Facility may restrict the Company from adopting any of these alternatives. Because of these and other factors that may be
beyond its control, the Company may be unable to service its indebtedness.
The Company has liabilities with respect to its pension plans and the actual cost of its pension plan obligations could exceed current provisions. As of
December 31, 2021, the Company’s defined benefit plans had a surplus of $248 million on certain plans and a deficit of $59 million on others.
Since pension fund obligations are primarily long-term in nature, losses in pension fund investments, if any, would result in increased contributions by the
Company, to be paid over 5 year or 10 year periods, depending upon the applicable legislation for funding
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pension deficits. Losses, if any, would also impact the Company’s results over a longer period of time and immediately increase liabilities and reduce
equity.
The Company’s future funding obligations for its defined benefit pension plans depend upon changes to the level of benefits provided by the plans, the
future performance of assets set aside in trusts for these plans, the level of interest rates used to determine minimum funding levels, actuarial data and
experience, and any changes in government laws and regulations. As of December 31, 2021, the Company’s defined benefit pension plans held assets with
a fair value of $1,622 million.
Market Risks
The Company faces intense competition in its markets, and the failure to compete effectively could have a material adverse effect on its business and
results of operations.
The Company competes with U.S., Canadian, European and Asian producers and, for many of its product lines with global producers, some of which may
have greater financial resources and lower production costs than the Company. The principal basis for competition is selling price. The Company’s ability
to maintain satisfactory margins depends largely on its ability to control its costs. Our industries also are particularly sensitive to other factors including
innovation, design, quality and service, with varying emphasis on these factors depending on the product line. The Company cannot provide assurance that
it will compete effectively and maintain current levels of sales and profitability. If the Company cannot compete effectively, such failure could have a
material adverse effect on its business and results of operations.
Conditions in the global political and economic environment, including the global capital and credit markets, can adversely affect the Company’s
business, results of operations and financial position.
A significant or prolonged downturn in the general economic environment may affect the Company’s sales and profitability. The Company has exposure to
counterparties with which it routinely executes transactions. Such counterparties include commercial banks, insurance companies and other financial
institutions, some of which may be exposed to bankruptcy or liquidity risks. A bankruptcy or illiquidity event by one of its significant counterparties may
materially and adversely affect the Company’s access to capital, future business and results of operations. In addition, the Company’s customers and
suppliers may be adversely affected by severe economic conditions. This could result in reduced demand for its products or its inability to obtain necessary
supplies at reasonable costs, or at all.
The Company may be negatively impacted by political issues or crisis in individual countries or regions, including sovereign risk related to a default by or
deterioration in the credit worthiness of local governments. Any of these effects, and others the Company cannot anticipate, may have a negative effect and
may adversely affect the Company’s business.
The Company is affected by changes in currency exchange rates.
The Company has manufacturing operations in the U.S. and Canada. As a result, it is exposed to movements in foreign currency exchange rates in Canada.
Moreover, certain assets and liabilities are denominated in currencies other than the U.S. dollar and are exposed to foreign currency movements. As a
result, the Company’s earnings are affected by increases or decreases in the value of the Canadian dollar relative to the U.S. dollar. Additionally, there has
been, and may continue to be, volatility in currency exchange rates. The Company’s risk management policy allows hedging a significant portion of its
exposure to fluctuations in foreign currency exchange rates for periods up to three years. The Company may use foreign exchange derivative instruments to
mitigate its exposure to fluctuations in foreign currency exchange rates. There can be no assurance that the Company will be protected against substantial
foreign currency fluctuations. Currency exchange rates could adversely affect the Company’s results of operations and financial position.
General Risks
A global pandemic (or any disease outbreak, including epidemics, pandemics, or similar widespread public health concerns such as the recent COVID-
19 pandemic) could have a material adverse effect on the Company’s business operations, results of operations, cash flows and financial position.
The Company’s business may be negatively impacted by the fear of exposure to or actual effects of a disease outbreak, epidemic, pandemic, or similar
widespread public health concern, resulting in travel restrictions or recommendations or mandates from governmental authorities to avoid large gatherings
or to self-quarantine. These impacts include, but are not limited to:
• Significant reductions in demand or significant volatility in demand for one or more of the Company’s products, which may be caused by, among
other things: the closing of offices and schools where paper is used extensively, the temporary inability of consumers to purchase the Company’s
products due to illness, quarantine or other travel restrictions, financial hardship, shifts in
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demand away from one or more of our more discretionary or higher priced products to lower priced products or use of alternatives, stockpiling or
similar activity; if prolonged, such impacts can further increase the difficulty of planning for operations and may adversely impact the Company’s
results;
• Inability to meet the Company’s customers’ needs and achieve cost targets due to disruptions in the Company’s manufacturing and supply
arrangements caused by constrained workforce capacity or the loss or disruption of other essential manufacturing and supply elements such as raw
materials or other finished product components, transportation, or other manufacturing and distribution capability;
• Failure of third parties on which the Company relies, including the Company’s suppliers, distributors, contractors or commercial banks, to meet their
obligations to the Company, or significant disruptions in their ability to do so, which may be caused by their own financial or operational difficulties
and may adversely impact the Company’s operations; or
• Significant changes in the political conditions in the markets in which the Company manufactures, sells or distributes its products, including
quarantines, import/export restrictions, price controls, or governmental or regulatory actions, closures or other restrictions that limit or close the
Company’s operating and manufacturing facilities, restrict the Company’s employees’ ability to travel or perform necessary business functions, or
otherwise prevent the Company’s suppliers or customers from sufficiently staffing operations, including operations necessary for the production,
distribution and sale of the Company’s products, which could adversely impact the Company’s results.
Despite the Company’s efforts to manage and mitigate these impacts to the Company, their ultimate impact also depends on factors beyond our knowledge
or control, including the duration and severity of any such outbreak as well as third-party actions taken to contain its spread and mitigate its public health
effects.
The Company’s financial results could be affected by changes in U.S. and foreign tax laws or in the mix of our U.S. and foreign earnings, as well as
adjustments to our estimates of uncertain tax issues or results from audits by U.S. or foreign tax authorities.
The Company is subject to U.S. and foreign tax laws and regulations. Tax laws, regulations, and administrative practices in various jurisdictions may be
subject to significant change, with or without notice, due to economic, political and other conditions, and significant judgment is required in evaluating and
estimating our provision and accruals for these taxes. International tax norms governing each country’s jurisdiction to tax cross-border international trade
have evolved partly due to the Base Erosion and Profit Shifting project led by the Organization for Economic Cooperation and Development and supported
by the G20. Changes in these laws and regulations, or any change in the position of tax authorities regarding their application, administration or
interpretation could adversely affect the Company’s financial results. In addition, a number of countries are actively pursuing changes to their tax laws
applicable to multinational corporations, such as the U.S. Tax Cuts and Jobs Acts (“U.S. Tax Reform”), enacted in 2017. Finally, foreign governments may
enact tax laws in response to the U.S. Tax Reform that could result in further changes to global taxation and materially impact the Company’s financial
results.
The Company’s effective tax rates could be affected by changes in the mix of earnings in countries with differing statutory tax rates or changes in the
valuation of deferred tax assets and liabilities. The Company is also subject to the examination of its tax returns and other matters by tax authorities and
governmental bodies. The Company regularly assesses the likelihood of an adverse outcome resulting from these examinations to determine the adequacy
of its provision for taxes and as of December 31, 2021, has a reserve for liabilities relating to uncertain tax positions of $22 million. Taxing authorities may
disagree with the positions the Company has taken regarding the tax treatment or characterization of its transactions. If any tax authorities were successful
in challenging the tax treatment or characterization of any of the Company’s transactions, it could also adversely affect its financial results.
The Company’s intellectual property rights are valuable, and any inability to protect them could reduce the value of its products and its brands.
The Company relies on patent, trademark and other intellectual property laws of the U.S. and other countries to protect its intellectual property rights.
However, the Company may be unable to prevent third parties from using its intellectual property without its authorization, which may reduce any
competitive advantage it has developed. If the Company had to litigate to protect these rights, any proceedings could be costly, and it may not prevail. The
Company cannot guarantee that any U.S. or foreign patents, issued or pending, will provide it with any competitive advantage or will not be challenged by
third parties. Additionally, the Company has obtained and applied for U.S. and foreign trademark registrations and will continue to evaluate the registration
of additional service marks and trademarks, as appropriate. The Company cannot guarantee that any of its pending patent or trademark applications will be
approved by the applicable governmental authorities and, even if the applications are approved, third parties may seek to oppose or otherwise challenge
these registrations. The failure to secure any pending patent or trademark applications may limit the Company’s ability to protect the intellectual property
rights that these applications were intended to cover.
18
If the Company is unable to successfully retain and develop executive leadership and other key personnel, it may be unable to fully realize critical
organizational strategies, goals and objectives.
The success of the Company is substantially dependent on the efforts and abilities of its key personnel, including its executive management team, to
develop and implement its business strategies and manage its operations. The failure to retain key personnel or to develop successors with appropriate skills
and experience for key positions in the Company could adversely affect the development and achievement of critical organizational strategies, goals and
objectives. There can be no assurance that the Company will be able to retain or develop the key personnel it needs and the failure to do so may adversely
affect its financial condition and results of operations.
Our operations could be adversely affected by disruptions to our Information Technology (IT) Services.
The Company’s IT systems, some of which are dependent on services provided by third parties, serve an important role in the efficient operation of its
business. The protection of customers, employees and company data is critical to the Company’s business. This role includes ordering and managing
materials from suppliers, managing its inventory, converting materials to finished products, facilitating order entry and fulfillment and processing of
transactions, summarizing and reporting its financial results, facilitating internal and external communications, administering human resources functions,
retaining certain personal information and providing other processes necessary to manage its business. The failure of the Company’s IT systems, including
any failure of the Company’s current systems and/or as a result of transitioning to additional or replacement IT systems, as the case may be, to perform as
the Company anticipates could disrupt the Company’s business and could result in, among other things, transactions errors, processing inefficiencies,
disruption of production and/or deliveries, loss of data and the loss of sales and customers, which could have a material adverse effect on the Company’s
business, financial position and results of operations and the effectiveness of our internal control over financial reporting could be negatively impact.
The Company is exposed to the risk of cyber incidents in the normal course of business. Cyber incidents may be deliberate attacks for the theft of
intellectual property or other sensitive information or may be the result of unintentional events. Like most companies, the Company's information
technology systems may be vulnerable to interruption due to a variety of events beyond the Company's control, including, but not limited to, natural
disasters, terrorist attacks, power and/or telecommunications failures, computer viruses, hackers and other security issues. The Company has technology
security initiatives and disaster recovery plans in place to mitigate the Company's risk to these vulnerabilities, including protection of confidential or
personal information, but these measures may not be adequate or implemented properly to ensure that the Company's operations are not disrupted. The
Company’s IT systems have been, and will likely continue to be, subject to computer viruses or other malicious codes, unauthorized access attempts,
phishing and other cyber-incidents. The Company cannot guarantee that its security efforts will prevent breaches or breakdowns to its IT systems or those
of its third-party providers. Potential consequences of a material cyber incident, which could result in confidential or personal information being accessed,
obtained, damaged or used by unauthorized or improper persons, include damage to the Company’s reputation, litigation, inefficiencies or production
downtimes and increased cyber security protection and remediation costs. Such consequences could have a negative impact on the Company’s ability to
meet customers’ orders, resulting in a delay or decrease to its revenue and a reduction to its operating margins.
ITEM 1B. UNRESOLVED STAFF COMMENTS
None.
19
ITEM 2. PROPERTIES
As of December 31, 2021, we had eight integrated pulp and paper mills (six in the United States and two in Canada) and two stand-alone pulp mills (one in
the U.S. and one in Canada). A description of our mills is included in Item I, Business.
Our paper manufacturing operations are supported by eleven converting and forms manufacturing operations (including a network of eight plants located
offsite from our paper making operations) as well as sales offices, regional replenishment centers and warehouse facilities located in the U.S and Canada
and a representative office located in Hong Kong, China.
Production facilities
We own substantially all of our production facilities. We lease substantially all of our sales offices, regional replenishment centers and warehouse facilities.
We believe our properties are in good operating condition and are suitable and adequate for the operations for which they are used. We own substantially all
of the equipment used in our facilities.
Approximately 70% of our paper production capacity is in the United States and 30% is located in Canada and approximately 69% of our pulp production
capacity is in the U.S. and 31% is in Canada.
Forestlands
We manage approximately 4 million acres of forestlands that are directly licensed or owned by Domtar in Canada, through efficient management and the
application of certified sustainable forest management practices. We also have access to fiber from an additional 25 million acres of public forestlands in
Canada that are licensed and managed by third parties. We believe that these forestlands will provide a continuous supply of wood for future needs.
ITEM 3. LEGAL PROCEEDINGS
In the normal course of operations, the Company becomes involved in various legal actions mostly related to contract disputes, patent infringements,
environmental and product warranty claims, and labor issues. The Company periodically reviews the status of these proceedings and assesses the likelihood
of any adverse judgments or outcomes of these legal proceedings, as well as analyzes probable losses. Although the final outcome of any legal proceeding
is subject to a number of variables and cannot be predicted with any degree of certainty, management currently believes that the ultimate outcome of
current legal proceedings will not have a material adverse effect on the Company’s long-term results of operations, cash flow or financial position.
However, an adverse outcome in one or more of the significant legal proceedings could have a material adverse effect on the Company’s results, financial
condition or cash flow in a given quarter or year.
For a discussion of commitments, legal proceedings and related contingencies, refer to Item 8, Financial Statements and Supplementary Data under, Note
20 “Commitments and Contingencies”.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
20
PART II
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF
EQUITY SECURITIES
As of December 31, 2021, there are no longer publicly traded common shares of Domtar Corporation.
ITEM 6. RESERVED
21
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
This Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) should be read in conjunction with Domtar
Corporation’s audited consolidated financial statements and notes thereto included in Item 8, Financial Statements and Supplementary Data. This
discussion contains forward-looking statements that involve risks and uncertainties. Our actual results may differ materially from those discussed in
forward-looking statements. Factors that might cause a difference include, but are not limited to, those discussed in Item 1, Business, under “Forward-
looking statements”, as well as in Item 1A, Risk Factors, in this report. Except where otherwise indicated, all financial information reflected herein is
determined on the basis of accounting principles generally accepted in the United States.
The information contained on our website, www.domtar.com, is not incorporated by reference into this Form 10-K and should in no way be construed as a
part of this or any other report that we file with or furnish to the SEC.
In accordance with industry practice, in this report, the term “ton” or the symbol “ST” refers to a short ton, an imperial unit of measurement equal to 0.9072
metric tons. The term “metric ton” or the symbol “ADMT” refers to an air dry metric ton. In this report, unless otherwise indicated, all dollar amounts are
expressed in U.S. dollars, and the term “dollars” and the symbol “$” refer to U.S. dollars.
OVERVIEW
We operate as a single reportable segment as described below, which also represents our only operating segment.
Pulp and Paper: Our Pulp and Paper business consists of the design, manufacturing, marketing and distribution of communication, specialty and
packaging papers, as well as softwood, hardwood and fluff pulps and high quality airlaid and ultrathin laminated cores.
Our segment measure of profit (operating income (loss) from continuing operations) is used by management to evaluate performance and make operational
decisions. Management believes that this measure allows for a better understanding of cost trends, operating efficiencies, prices and volume. Business
segment operating income (loss) is defined as earnings (loss) from continuing operations before income taxes and equity losses, excluding corporate items,
interest expense, net, and non-service components of net periodic benefit cost. Corporate expenses are allocated to our segment with the exception of
certain discretionary charges and credits, which we present under “Corporate” and do not allocate to the segment.
Paper Excellence Acquired Domtar Corporation
On November 30, 2021, Paper Excellence completed the acquisition of all the outstanding common shares of Domtar Corporation by means of a merger of
Pearl Merger Sub (a wholly-owned subsidiary) with and into the Company with the Company continuing as the surviving corporation and as a subsidiary
of Paper Excellence (the “Merger”). Refer to Item 8, Financial Statements and Supplementary Data, under Note 4 “Acquisition of Businesses” for
additional information on the Merger.
As a condition to obtain the approval of the Merger from the Canadian Competition Bureau, we were required to commit to the divestiture of our
Kamloops, British Columbia pulp mill, within a short period of time following the Merger. The assets and liabilities related to the pulp mill for all periods
are presented as held for sale in the Consolidated Balance Sheet. The sale of the pulp mill meets the criteria for discontinued operations and as such,
earnings are included within Earnings (loss) from discontinued operations, net of taxes in the Consolidated Statement of Earnings (Loss) and
Comprehensive income (loss) for all periods presented. Refer to Item 8, Financial Statements and Supplementary Data, under Note 3 “Discontinued
Operations” for additional information on the Discontinued Operations.
Certain reclassifications have been made to the prior years presentation to conform to the current year presentation.
Kingsport, Tennessee mill
We plan to enter the linerboard market with the conversion of our Kingsport mill. Once in full operation, the mill will produce and market approximately
600,000 tons annually of high-quality recycled linerboard and medium, providing us with a strategic footprint in a growing adjacent market. The
conversion is expected to be completed by the end of 2022.
We estimate the capitalized conversion cost to be approximately $350 million. Once fully operational, the mill is expected to be a low-cost, first quartile
recycled linerboard mill in North America. The converted mill is expected to directly employ approximately 160 employees.
ONGOING IMPACT OF THE COVID-19 PANDEMIC
As reflected in the discussion below, ongoing impacts of the COVID-19 pandemic and actions taken in response to them had varying effects on our 2021
results of operations, although some effects, including customer demand, are mitigating or becoming more
22
difficult to isolate or quantify. Moreover, it is difficult to determine the duration and scope of the pandemic, the scale and rate of economic recovery from
the pandemic, any ongoing effects on consumer demand and spending patterns, supply chain disruptions, and labor availability and costs, or the impact of
other indirect factors that may be attributable to the pandemic, and the extent to which these or other currently unanticipated consequences of the pandemic
are reasonably likely to materially affect our results of operations. In addition, these factors can make it difficult to isolate and quantify the portion of our
costs that are a direct result of the pandemic and costs arising from factors that may have been influenced by the pandemic, including increased wage rates
and incentives, increased carrier rates, and fulfillment network inefficiencies resulting from constrained labor markets and global supply chain constraints.
We expect these factors and their effects on our operations to continue into 2022.
2020 COST REDUCTION PROGRAM
In 2020, we had implemented a cost savings program, which we had completed at the end of the second quarter of 2021. As part of this program, we
announced the permanent closure of the uncoated freesheet manufacturing at our Kingsport, Tennessee and Port Huron, Michigan mills, the remaining
paper machine and converting operations at the Ashdown, Arkansas mill and the converting center in Ridgefields, Tennessee. Additionally, we announced
the closure of the converting center in Dallas, Texas. These actions reduced the Company’s annual uncoated freesheet paper capacity by
approximately 721,000 short tons and resulted in a workforce reduction of approximately 750 employees. The Kingsport paper machine has been idled
since April 2020. The Ridgefields converting center ceased operations at the end of the third quarter of 2020, while the Port Huron mill shut down at the
end of February 2021 and the Dallas converting center ceased operations at the beginning of July 2021.
Restart of the paper machine and converting operations at Ashdown, Arkansas mill
On July 15, 2021, we announced our intention to restart the paper machine and converting operations at the Ashdown, Arkansas mill, which has been idled
since April 2020, to add an additional 185,000 tons per year of uncoated freesheet production capacity to our manufacturing network. The increase was
necessary to meet growing customer demand as the economy recovers from the COVID-19 pandemic. The additional paper capacity will result in a
capacity reduction of 185,000 ADMT per year of baled SBSK pulp at the mill. The machine restarted in the fourth quarter of 2021 and is now in full
operation.
COMBINED RESULTS
For purposes of the Company’s financial statement presentation, Pearl Merger Sub was determined to be the accounting acquirer in the Merger which
was accounted for using the acquisition method of accounting. The application of the acquisition method of accounting resulted in a new basis of the
Company’s assets and liabilities which are measured at fair value as of the date of the Merger. To reflect the application of different bases of accounting
as a result of the Merger, the tables below separate our results via a black line into two distinct periods as follows: (1) up to and including the Merger
closing date (“Predecessor”) and (2) the period after that date (“Successor”). The period starting December 1, 2021 is the “Successor” periods while the
periods ending before December 1, 2021 are the “Predecessor” periods. The Predecessor period results have been restated to present the operations of the
Kamloops pulp mill as discontinued operations.
We have prepared our discussion of the results of operations by comparing the results of the combined Successor period from December 1 through
December 31, 2021 and the Predecessor period from January 1, 2021 through November 30, 2021 (“S/P Combined”) and the Predecessor years ended
December 31, 2020 and December 31, 2019. We believe this approach provides the most meaningful basis of comparison and is more useful in identifying
current business trends for the periods presented.
The Predecessor period includes the historical financial information of Pearl Merger Sub prior to the business combination, which is limited to immaterial
amounts of interest and merger-related transactions costs. The businesses, and thus financial results, of the Successor and Predecessor entities are virtually
the same, excluding the impact on certain financial statement line items that were impacted by the Merger.
The combined results of operations included in our discussion below are not considered to be prepared in accordance with accounting principles generally
accepted in the United States of America (“non-GAAP”) and have not been prepared as pro forma results under applicable regulations, may not reflect the
actual results we would have achieved had the Merger occurred at the beginning of fiscal 2021, and should not be viewed as a substitute for the results of
operations of the Predecessor and Successor periods presented in accordance with accounting principles generally accepted in the United States of
America.
In the following discussion, unless otherwise noted, references to increases or decreases in income and expense items, prices, contribution to net earnings
(loss), and shipment volumes are based on the twelve-month periods ended December 31, 2021, 2020 and 2019. The twelve-month periods are also referred
to as 2021, 2020 and 2019. References to notes refer to footnotes to the consolidated financial statements and notes thereto included in Item 8, Financial
Statements and Supplementary Data.
23
Successor
Predecessor
Period from
December 1,
2021 through
December 31,
2021
Period from
January 1, 2021
through
November 30,
2021
(non-GAAP)
S/P Combined
Predecessor
Year ended
December 31,
2021
Year ended
December 31,
2020
Year ended
December 31,
2019
$
300
$
3,368
$
3,668
$
3,415
$
4,119
251
23
23
—
(1)
3
—
—
299
1
10
(2)
(7) $
(2)
—
(5) $
1
(4) $
$
$
2,771
182
246
9
17
27
132
3,379
(5)
$
(11) $
54
(22)
(43) $
6
—
(49) $
26
(23) $
3,022
205
269
9
16
30
132
3,678
(5)
$
(10) $
64
(24)
(50) $
4
—
(54) $
27
(27) $
2,914
208
252
136
99
—
—
(7)
3,602
$
(187) $
58
(17)
(228) $
(80)
3
(151) $
24
(127) $
3,402
216
289
32
22
—
—
4
3,965
154
52
23
79
11
2
66
18
84
4
(3)
$
1
157
(168)
(11) $
161
(171)
(10) $
(153)
(34)
(187) $
201
(47)
154
$
$
$
$
$
$
Sales
Operating Expenses
Cost of sales, excluding depreciation and amortization
Depreciation and amortization
Selling, general and administrative
Impairment of long-lived assets
Closure and restructuring costs
Asset conversion costs
Transaction costs
Other operating (income) loss, net
Operating income (loss) from continuing operations
Interest expense, net
Non-service components of net periodic benefit cost
(Loss) earnings before income taxes and equity loss
Income tax (benefit) expense
Equity method investment loss, net of taxes
(Loss) earnings from continuing operations
Earnings from discontinued operations, net of taxes
Net (loss) earnings
Operating income (loss) from continuing operations
Pulp and Paper
Corporate
Operating income (loss) from continuing operations
2021 S/P COMBINED HIGHLIGHTS
•
•
•
•
•
•
We reported an operating loss from continuing operations of $10 million, compared to operating loss from continuing operations of
$187 million in 2020
We reported a loss from continuing operations of $54 million compared to loss from continuing operations of $151 million in 2020
Earnings from discontinued operations, net of taxes amounted to $27 million in 2021, including a loss on disposition of discontinued
operations, net of tax, of $33 million
Sales increased by 7% from 2020. Net average selling prices for pulp and paper were up from 2020. Our manufactured paper volume was
down while our pulp volume was up when compared to 2020
Recognition of closure and restructuring charges and accelerated depreciation under Impairment of long-lived assets, of $16 million and
$9 million, respectively, mostly related to our cost reduction program that we announced in 2020
Recognition of $132 million of transaction costs under Transaction costs, related to our Merger
24
FINANCIAL HIGHLIGHTS
(In millions of dollars, unless otherwise noted)
Sales
$
Operating income (loss) from continuing operations (a)
(non-GAAP)
S/P
Combined
Year ended
December 31,
2021
Predecessor
Year ended
December 31,
2020
Year ended
December 31,
2019
Variance 2021 vs. 2020
Variance 2020 vs. 2019
$
%
$
%
3,668
$
3,415
$
4,119
$
253
7% $
(704)
-17%
Pulp and Paper
Corporate
Operating (loss) income from continuing operations
(Loss) Earnings from continuing operations
Earnings from discontinued operations, net of taxes
Net (loss) earnings
161
(171)
(10)
(54)
27
(27)
(153)
(34)
(187)
(151)
24
(127)
201
(47)
154
66
18
84
314
(137)
177
97
3
100
205%
-403%
95%
64%
-13%
79%
(354)
13
(341)
(217)
6
(211)
-176%
28%
-221%
-329%
33%
-251%
Total assets
Total long-term debt, including current portion
Successor
Predecessor
At December 31,
At December 31,
2021
2020
$
$
4,854 $
1,902 $
4,856
1,092
(a)
In 2021, in our Pulp and Paper operations, we recognized $30 million of conversion costs under Asset conversion costs related to our Kingsport mill
conversion and closure and restructuring charges and accelerated depreciation under Impairment of long-lived assets related to our cost reduction
program of $14 million and $9 million, respectively. In addition, under Corporate, we recognized $132 million of transaction costs and $2 million of
closure and restructuring charges. In 2020, we recognized closure and restructuring charges and accelerated depreciation under Impairment of long-
lived assets related to our announced cost reduction program of $96 million and $136 million, respectively as well as closure and restructuring
charges of $3 million under Corporate. In 2019, we recognized closure and restructuring charges and accelerated depreciation under Impairment of
long-lived assets of $22 million and $32 million, respectively associated with our decision to permanently close two paper machines. See Item 8,
Financial Statements and Supplementary Data, under Note 14 “Closure and Restructuring Costs and Impairment of Long-Lived Assets” for more
information.
25
REVIEW OF OPERATIONS
This section presents a discussion and analysis of our S/P Combined twelve months ended December 31, 2021, with the Predecessor twelve months ended
December 31, 2020 and 2019 sales, operating (loss) income and other information relevant to the understanding of our results from continuing operations.
ANALYSIS OF SALES
Sales
Shipments
Paper - manufactured (in thousands of ST)
Communication Papers
Specialty and Packaging papers
Paper - sourced from third parties (in thousands of
ST)
Paper - total (in thousands of ST)
Pulp (in thousands of ADMT)
(non-GAAP) S/P
Combined
Twelve months
ended December
31, 2021
3,668
$
2,144
1,769
375
74
2,218
1,433
Predecessor
Twelve months ended
December 31, 2020
Twelve months
ended December
31, 2019
$
3,415 $
4,119
253
7%
Variance 2021 vs. 2020
Variance 2020 vs. 2019
$
%
$
(704)
%
-17%
2,230
1,825
405
69
2,299
1,399
2,745
2,299
446
93
2,838
1,305
(86)
(56)
(30)
5
(81)
34
-4%
-3%
-7%
7%
-4%
2%
(515)
(474)
(41)
(24)
(539)
94
-19%
-21%
-9%
-26%
-19%
7%
Sales in 2021 increased by $253 million, or 7% when compared to sales in 2020. This increase in sales is mostly due to an increase in net average selling
prices for pulp and paper and an increase in our pulp sales volumes. This increase was partially offset by a decrease in paper sales volumes.
Sales in 2020 decreased by $704 million, or 17% when compared to sales in 2019. This decrease in sales is mostly due to a decrease in our paper sales
volumes and a decrease in net average selling price for pulp and paper. This decrease was partially offset by an increase in our pulp sales volumes.
ANALYSIS of CHANGE IN OPERATING INCOME (LOSS) FROM CONTINUING OPERATIONS
2021 vs. 2020
Operating income from continuing operations in our Pulp and Paper business amounted to $161 million in 2021, an increase in income of $314 million,
when compared to operating loss from continuing operations of $153 million in 2020. Our results were positively impacted by:
•
•
•
•
Higher net average selling prices for pulp and paper ($315 million)
Lower depreciation/impairment charges ($133 million). We recorded $9 million of accelerated depreciation under Impairment of long-lived
assets, related to our cost reduction program in 2021 compared to $136 million of accelerated depreciation under Impairment of long-lived
assets, also related to our cost reduction program in 2020. Depreciation charges were lower by $6 million when compared to 2020
Lower restructuring charges ($43 million) in 2021 as a result of closure and restructuring cost ($14 million) related to our cost reduction
program, compared to closure and restructuring costs ($96 million) related to our cost reduction program in 2020, partially offset by asset
conversion costs ($30 million) related to our Kingsport mill conversion
The negative impact of a stronger Canadian dollar on our Canadian denominated expenses, was more than offset by a favorable on our hedging
program ($4 million)
These increases were partially offset by:
•
•
•
•
Higher operating expenses ($102 million) mostly due to higher freight cost, higher salary and wages due to lower amounts recognized from the
CEWS when compared to 2020 and lower production, partially offset by lower maintenance expense
Higher input costs ($66 million) mostly related to higher cost of chemical and energy due in part to severe weather condition in early 2021 and
unfavorable market conditions compared to 2020
Lower volume/ mix ($15 million) mostly related to lower volume of paper, partially offset by higher volume of pulp
Lower other income ($7 million)
26
OTHER FACTORS
Corporate
We incurred $171 million of corporate charges in 2021, an increase of $137 million compared to corporate charges of $34 million in 2020. This increase
was mostly due to transaction costs related to our Merger and higher SG&A expenses, partially offset by a decrease in restructuring expenses related to our
cost reduction program.
Interest Expense, net
We incurred $64 million of net interest expense in 2021, an increase of $6 million compared to net interest expense of $58 million in 2020. We paid $11
million in make-whole premium fees related to the early retirement of the 4.4% Notes originally due March 2022, in the second quarter of 2021. This
increase was also due to the $775 million Senior Secured Notes due 2028 issued on October 18, 2021 as well as the new ABL Revolving Credit Facility
entered into on November 30, 2021 and First Lien Term Loan facility entered on November 30, 2021. This increase was partially offset by lower interest on
the 4.4% Notes due to the early retirement in April 2021. In 2021, we had capitalized interest of $9 million, compared to $3 million in 2020, mostly related
to our mill conversion. See Item 8, Financial Statements and Supplementary Data, under Note 17 “Long-term Debt” for more information on our new debt
structure following our Merger on November 30, 2021.
Income Taxes
We recorded an income tax expense of $4 million in 2021 compared to an income tax benefit of $80 million in 2020, which yielded an effective tax rate of
-8% and 35% for 2021 and 2020, respectively.
On November 30, 2021, we were acquired by Paper Excellence and incurred significant costs to complete the transaction as well as significant executive
compensation as a result of the change in control. Certain of these transaction costs and executive compensation expenses are not deductible for tax
purposes and substantially impact the effective tax rate. We also recorded $3 million of tax expense related to Global Intangible Low-Tax Income (GILTI)
and $10 million of tax credits, mainly research and experimentation credits. Both of which significantly impact the effective tax rate. GILTI is an additional
U.S. tax on certain income earned by foreign subsidiaries.
On January 7, 2021, we reached an agreement with AIP to sell the Personal Care business. As such, for the December 31, 2020 reporting period, we were
no longer indefinitely reinvested in that business and classified its investment in that business as held for sale. Accordingly, a deferred tax asset of
$51 million was recorded for the difference between the net book value of the business and the tax basis of that business. We accounted for the tax impacts
related to the sale of the Personal Care business as a stock investment and therefore recognized the tax benefit for recording the book/tax basis difference
and the net book value adjustment as part of continuing operations. Both of these items impacted the effective tax rate in 2020.
We assessed the value of the deferred tax asset related to the basis difference described above, which is shown as a capital loss for tax purposes and
determined that we will not realize the full benefit from the asset. As such, we recorded a valuation allowance of $44 million associated with this deferred
tax asset. During 2020, we also analyzed our existing Arkansas research and development credits and recorded an additional valuation allowance of $3
million since it is expected some of the credits will expire un-utilized. These amounts unfavorably impacted the effective tax rate in 2020.
During 2020, we generated a U.S. tax net operating loss which, in accordance with the Coronavirus Aid, Relief, and Economic Security (CARES) Act was
carried back to 2015. In 2015, the U.S. federal tax rate was 35%, versus the current rate of 21%. Therefore, we recorded an additional tax benefit of $5
million related to the tax rate benefit of the loss which favorably impacted the effective tax rate in 2020.
We recorded $17 million of tax credits, mainly research and experimentation credits, which favorably impacted the effective tax rate in 2020. Since we had
a tax loss in 2020, the tax credits were carried forward and were utilized in 2021.
Economic conditions and uncertainties
The markets in which our pulp and paper business operates are highly competitive with well-established domestic and foreign manufacturers. Most of our
products are commodities that are widely available from other producers as well. Because commodity products have few distinguishing qualities from
producer to producer, competition for these products is based primarily on price, which is determined by supply relative to demand. We also compete on
the basis of product quality, breadth of offering and service solutions. Further, we compete against electronic transmission and document storage
alternatives. As a result of such competition, we are experiencing ongoing decreasing demand for most of our existing paper products. In addition, current
global economic conditions are highly volatile due to the COVID-19 pandemic, resulting in both market size contractions in certain countries due to
economic slowdowns and government restrictions on movement. The pulp market is highly fragmented with many manufacturers competing worldwide.
Competition is primarily on the product quality and competitively priced pulp products.
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In 2022, our paper sales volume is expected to benefit from the restart of a paper machine at our Ashdown facility, while our pulp volume should remain
flat as the benefit from improved production at some facilities should offset the decrease resulting from the paper machine restart at Ashdown. In paper, we
also expect to benefit from recently announced price increases. Overall raw material and logistics costs are expected to increase mostly due to inflation.
2020 vs. 2019
Operating loss from continuing operations in our Pulp and Paper business amounted to $153 million in 2020, a decrease of $354 million, when compared to
operating income from continuing operations of $201 million in 2019. Our results were negatively impacted by:
•
•
•
•
Lower net average selling prices for pulp and paper ($178 million)
Lower volume and mix ($129 million) mostly related to lower volume of paper, partially offset by higher volume of pulp
Higher depreciation/impairment charges ($97 million). We recorded $136 million of accelerated depreciation under Impairment of long-lived
assets, related to our cost reduction program in 2020 compared to $32 million of accelerated depreciation under Impairment of long-lived assets,
related to our decision to permanently close two paper machines in 2019. Depreciation charges were lower by $7 million when compared to
2019
Higher restructuring charges ($74 million) as a result of the cost reduction program ($96 million) in 2020 compared to the decision to
permanently close two paper machines in 2019 ($22 million)
These decreases were partially offset by:
•
•
•
•
Lower input costs ($80 million) mostly related to lower cost of fiber, due in part by better weather and favorable market conditions compared to
2019
Lower operating expenses ($25 million) mostly due to lower maintenance and other costs due to our cash conservation initiative (including our
cost reduction program) in light of the COVID-19 pandemic and amounts recognized from the CEWS when compared to 2019, partially offset
by lower production
Higher other income ($10 million)
Positive impact of a weaker Canadian dollar on our Canadian denominated expenses, net of our hedging program ($9 million)
OTHER FACTORS
Corporate
We incurred $34 million of corporate charges in 2020, a decrease of $13 million compared to corporate charges of $47 million in 2019. This decrease was
mostly due to lower SG&A expenses and partially offset by an increase in restructuring expenses, both as a result of the cost reduction program.
Interest expense, net
We incurred $58 million of net interest expense in 2020, an increase of $6 million compared to net interest expense of $52 million in 2019. The net interest
expense was impacted by the $300 million Term Loan entered into on May 5, 2020 as well as an increase in borrowing under the revolving credit facility.
Income Taxes
We recorded an income tax benefit of $80 million in 2020 compared to an income tax expense of $11 million in 2019, which yielded an effective tax rate of
35% and 14% for 2020 and 2019, respectively.
On January 7, 2021, we reached an agreement with American Industrial Partners (AIP) to sell the Personal Care Division. As such, for the December 31,
2020 reporting period, we are no longer indefinitely reinvested in that business and have classified our investment in that business as held for sale.
Accordingly, we have recorded a Deferred Tax Asset of $51 million for the difference between the net book value of the business and the tax outside basis.
We accounted for the tax impacts related to the sale of the Personal Care Division as a stock investment and therefore recognized the tax benefit for
recording the book/tax basis difference and the net book value adjustment as part of continuing operations. Both of these items impacted the effective tax
rate in 2020.
We assessed the value of the deferred tax asset related to the book/tax basis difference, which we expected to be a capital loss for tax upon the completion
of the sale and determined that we were not likely to realize a full benefit from the asset. As such, we recorded a valuation allowance of $44 million
associated with this tax asset. During the year, we also analyzed our existing Arkansas research
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and development credits and determined an additional valuation allowance of $3 million should be recorded since it is expected some of the credits will
expire un-utilized. These amounts unfavorably impacted the effective tax rate in 2020.
During 2020, we generated a U.S. tax net operating loss which, in accordance with the Coronavirus Aid, Relief, and Economic Security (CARES) Act will
be carried back to 2015. In 2015, the U.S. federal tax rate was 35%, versus the current rate of 21%. Therefore, we recorded an additional tax benefit of $5
million related to the tax rate benefit of the loss which favorably impacted the effective tax rate in 2020. We also recorded $17 million of tax credits, mainly
research and experimentation credits, which favorably impacted the effective tax rate in 2020. Since we had a tax loss in 2020, the tax credits will be
carried forward and are expected to be utilized in future years.
As a result of the deemed mandatory repatriation tax requirement of the U.S. Tax Reform, we have taxed our undistributed foreign earnings as of December
31, 2017, at reduced tax rates. After completing our evaluation of the U.S. Tax Reform’s impact on its business operations, we had determined that we are
no longer indefinitely reinvested in these undistributed foreign earnings as well as foreign earnings after December 31, 2017. As such, as of December 31,
2020, we have recorded a deferred tax liability of $11 million ($12 million as of December 31, 2019) for foreign withholding tax and various state income
taxes associated with future repatriation of these earnings. This additional $1 million tax benefit impacted the effective tax rate for 2020 ($2 million tax
expense for 2019).
We recorded $18 million of tax credits in 2019, mainly research and experimentation credits, which significantly impacted the effective tax rate. Arkansas
legislation changes were passed in 2019 which reduced the state tax rate and changed how the apportionment factor is calculated. This resulted in a
deferred state tax benefit of $4 million. Additionally, a valuation allowance of $5 million was recorded on state attributes we do not expect to utilize before
they expire.
DISCONTINUED OPERATION
For the year ended December 31, 2021, we reported earnings on discontinued operations, net of taxes, of $27 million (2020 - earnings from discontinued
operations, net of taxes of $24 million; 2019 - earnings from discontinued operations, net of taxes, of $18 million).
Mandated sale of Kamloops, British Columbia mill
As a condition to obtain the approval of the November 30, 2021 Merger from the Canadian Competition Bureau, we were required to commit to the
divestiture of our Kamloops, British Columbia pulp mill, within a short period of time following the Merger. The assets and liabilities related to the pulp
mill for all periods are presented as held for sale in the Consolidated Balance Sheet. The sale of the pulp mill meets the criteria for discontinued operations
and as such, earnings are included within Earnings (loss) from discontinued operations, net of taxes in the Consolidated Statement of Earnings (Loss) and
Comprehensive income (loss) for all periods presented Refer to Item 8, Financial Statements and Supplementary Data, under Note 3 “Discontinued
Operations” for additional information on the Discontinued Operations.
Sale of our Personal Care business
On March 1, 2021, we completed the sale of our Personal Care business to American Industrial Partners (“AIP”), for a purchase price of $920 million in
cash. Based on its magnitude and because we exited the Personal Care business, the sale represents a significant strategic shift that has a material effect on
our operations and financial results. Accordingly, all periods presented reflect the Personal Care business as a discontinued operation. Our Personal Care
business was previously disclosed as a separate reportable segment. For more information on our discontinued operations, refer to Item 8, Financial
Statements and Supplemental Data, under Note 3, “Discontinued Operations”.
STOCK-BASED COMPENSATION EXPENSE
As a result of the acquisition by Paper Excellence, on the Merger date, we recognized an accelerated vesting on all the outstanding stock-based awards
under the Omnibus Plan. These awards were then cancelled and converted into the right to receive cash payment, which was made in December 2021. In
turn, the Omnibus Plan was terminated and is expected to be replaced in 2022 by another long-term incentive program. Refer to Item 8, Note 5 “Stock-
Based Compensation” for more information.
For the year ended December 31, 2021, stock-based compensation expense recognized in the predecessor results from continuing and discontinued
operations was $46 million (2020 – $7 million) of which $34 million, related to the accelerated vesting of stock-based awards, was recorded under
Transaction costs in the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss).
LIQUIDITY AND CAPITAL RESOURCES
Our principal cash requirements are for ongoing operating costs, pension contributions, working capital and capital expenditures, as well as principal and
interest payments on our debt and income tax payments. We expect to fund our liquidity needs primarily with internally generated funds from our
operations and, to the extent necessary, through borrowings under our $400 million ABL
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Revolving Credit Facility, of which $209 million was undrawn and available as at December 31, 2021. Under adverse market conditions, there can be no
assurance that these agreements would be available or sufficient. See “Capital Resources” below.
Our ability to make payments on the requirements mentioned above will depend on our ability to generate cash in the future, which is subject to general
economic, financial, competitive, legislative, regulatory and other factors that are beyond our control. Our debt agreements impose various restrictions and
covenants on us that could limit our ability to respond to market conditions, to provide for unanticipated capital investments or to take advantage of
business opportunities.
A portion of our cash is held outside the U.S. by foreign subsidiaries. The earnings of the foreign subsidiaries reflect full provision for local income taxes.
The U.S. Tax Reform includes a mandatory one-time tax on accumulated earnings of foreign subsidiaries for which we recorded a provisional repatriation
tax amount of $46 million in 2017 and adjusted by $7 million in 2018. After completing our evaluation of the U.S. Tax Reform’s impact on the business
operations, we have determined that we are no longer indefinitely reinvested in these undistributed foreign earnings as well as foreign earnings after
December 31, 2017. We remain indefinitely reinvested in the outside basis differences of our foreign subsidiaries.
Operating Activities
Our operating cash flow requirements are primarily for salaries and benefits, the purchase of raw materials, including fiber and energy, and other expenses
such as income tax and property taxes.
Cash flows from operating activities, including discontinued operations, for the combined twelve-month period ended December 31, 2021 amounted to
$104 million, a $307 million decrease compared to cash flow from operating activities, including discontinued operations, of $411 million in 2020. This
decrease in cash flows from operating activities is primarily due to an increase in working capital requirements, partially offset by an increase in
profitability. We made income tax payments, net of refunds, of $39 million during 2021 compared to income tax refunds, net of payment of $22 million in
2020. We paid $19 million of employer pension and other post-retirement contribution in excess of pension and other post-retirement expense in 2021
compared to 2020 when we paid $4 million of employer pension and other post-retirement contributions in excess of pension and other post-retirement
expense.
Investing Activities
Cash flows used for investing activities, including discontinued operations, in the combine twelve month period ended December 31, 2021 amounted to
$2,204 million, a $2,002 million increase compared to cash flow used for investing activities, including discontinued operations, of $202 million in 2020.
The use of cash in the combined twelve-month period ended December 31, 2021 was mostly related to the acquisition of business of $2,796 million
attributable to the Merger with the Company being the surviving company as well as additions to property, plant and equipment of $309 million. This was
partially offset by the proceeds from the sale of our Personal Care business ($897 million) and proceeds from sale of property of $4 million.
The use of cash in 2020 was attributable to additions to property, plant and equipment of $175 million and the acquisition of the Appvion Point of Sale
Business in the second quarter of 2020 ($30 million).
Our annual capital expenditures for 2022 should increase due mostly to our Kingsport mill conversion and are currently expected to be between
$320 million and $340 million.
Financing Activities
Cash flows provided from financing activities, including discontinued operations, in the combined twelve-month period ended December 31, 2021
amounted to $2,077 million, compared to cash flow provided from financing activities, including discontinued operations, of $35 million in 2020.
The primary source of cash flows provided from financing activities in 2021 was attributable to the proceeds from the issuance of the Senior Secured
6.75% Notes ($775 million), the First Lien Term Loan facility ($520 million), and borrowings under our ABL Revolving Credit Facility ($115 million) in
2021. This was partially offset by the early repayment of the Term Loan and 4.4% Notes, including make-whole premium ($606 million) as well as for the
repurchase of our common stock ($238 million).
The primary source of cash flows provided from financing activities in 2020 was from proceeds of the term loan ($300 million). This was partially offset
by the decrease in borrowings under our credit facilities (revolver and receivables securitization) ($135 million), the repurchase of our common stock
($59 million), dividend payments ($51 million) and a decrease in bank indebtedness ($10 million).
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Capital Resources
Net indebtedness, consisting of bank indebtedness and long-term debt, net of cash and cash equivalents and restricted cash, was $1,616 million as of
December 31, 2021 compared to $783 million as of December 31, 2020.
ABL Revolving Credit Facility
On November 30, 2021, we entered into our ABL Revolving Credit Facility that matures on November 30, 2026. Our ABL Revolving Credit Facility is
available to Domtar Corporation and certain other domestic and Canadian subsidiaries and provides for revolving loans and letters of credit in an aggregate
amount of up to $400 million, subject to borrowing base capacity.
Borrowings under our ABL Revolving Credit Facility are limited by borrowing base calculations based on the sum of specified percentages of eligible
accounts receivable, plus specified percentages of eligible inventory, plus specified percentages of qualified cash, minus the amount of any applicable
reserves. Borrowings bear interest at a floating rate, which can be either an adjusted Eurodollar rate plus an applicable margin or, at our option, a base rate
plus an applicable margin.
Our obligations under our ABL Revolving Credit Facility are guaranteed by our immediate parent (a company with no assets other than Domtar shares) and
our wholly-owned material U.S. subsidiaries and wholly-owned material Canadian subsidiaries. Our ABL Revolving Credit Facility has a first-priority lien
on the current assets of such U.S. and Canadian subsidiaries, and a second-priority lien on the fixed assets of our wholly-owned material U.S. subsidiaries,
excluding principal properties (second in priority to the liens securing our First Lien Term Loan Facility (“Term Loan Facility”) discussed below), in each
case, subject to permitted liens.
Borrowings under the ABL Revolving Credit Facility bear interest at LIBOR, EURIBOR, Canadian bankers' acceptance or prime rate, as applicable, plus a
margin linked to the Company’s utilization of the credit. In addition, the Company pays facility fees quarterly at rates linked to the Company’s utilization of
the credit. The Company does not anticipate a significant impact to its financial position from the planned phase out of LIBOR.
Our ABL Revolving Credit Facility contains customary covenants, including, but not limited to, restrictions on our ability and that of our subsidiaries to
merge and consolidate with other companies, incur indebtedness, grant liens or security interests on assets, make acquisitions, loans, advances or
investments, pay dividends, sell or otherwise transfer assets, optionally prepay or modify terms of any junior indebtedness, enter into transactions with
affiliates or change our line of business.
Our ABL Revolving Credit Facility requires the maintenance of a fixed charge coverage of 1.00 to 1.00 at the end of each fiscal quarter for the trailing
twelve month period, when specified excess availability is less than the greater of $35 million and 10% of the lesser of the borrowing base and maximum
borrowing capacity. This covenant did not apply at December 31, 2021.
At December 31, 2021, we had $115 million borrowings and $76 million of letters of credit outstanding under this facility.
Existing Domtar Notes Change of Control Offers
Following the change of control of Domtar, Domtar was obligated, pursuant to the indenture governing the 6.25% Notes due 2042 and the 6.75% Notes due
2044 (“Existing Domtar Notes”), to make the Existing Domtar Notes Change of Control Offers, pursuant to which Domtar offered to repurchase all of the
Existing Domtar Notes from holders at a purchase price of 101%. Up to $250 million under the First Lien Term Loan was available on a delayed draw basis
(“Delayed Draw Term Loan”) and up to $250 million aggregate principal amount of the 6.75% Senior Secured Notes was earmarked for the repurchase of
the Existing Domtar Notes pursuant to the Existing Domtar Notes Change of Control Offers. Up to $250 million aggregate principal amount of the Senior
Secured Notes was subject to special mandatory redemption to the extent proceeds were not used to fund the redemptions of the Existing Domtar Notes
pursuant to the Existing Domtar Notes Change of Control Offers.
On January 3, 2022, $134 million of the 6.25% Notes due 2042 and $100 million of the 6.75% Notes due 2044 were tendered pursuant to the offer. As a
result, $116 million of the 6.25% Notes due 2042 and $150 million of the 6.75% Notes due 2044, remain outstanding post January 7, 2022, the payment
date.
First Lien Term Loan Facility
On November 30, 2021, we entered into a Term Loan Facility maturing November 30, 2028, of which $525 million was immediately drawn and up to $250
million was available as a Delayed Draw Term Loan.
Borrowings under our Term Loan Facility amortize in equal quarterly installments in an amount equal to 1.00% per annum of the principal amount in 2022
and 5% per annum thereafter.
The interest rate margin applicable to borrowings under our Term Loan Facility will be, at our option, either (1) the base rate plus an applicable margin or
(2) LIBOR plus an applicable margin. Our Term Loan Facility will be subject to a LIBOR floor of 0.75%.
We will be required to prepay our Term Loan Facility and Senior Secured Notes with 100% of the net cash proceeds of certain asset sales subject to certain
reinvestment rights. We will be required to prepay our Term Loan Facility with 100% of the net cash proceeds of certain debt issuances and 50% of excess
cash flow in each case, subject to certain exceptions.
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Our obligations under our Term Loan Facility are guaranteed by our immediate parent (a company with no assets other than Domtar shares) and all of the
Issuer’s direct and indirect wholly-owned material U.S. subsidiaries. Our Term Loan Facility has a first priority lien on the fixed assets of our wholly-
owned material U.S. subsidiaries, representing 75% of the Consolidated Fixed Assets, and a second-priority lien on the current asset collateral in the U.S.
(second in priority to the liens securing our ABL Revolving Credit Facility discussed above), in each case, subject to other permitted liens.
Our Term Loan Facility contains customary negative covenants consistent with those applicable to the Notes, including, but not limited to, restrictions on
our ability and that of our restricted subsidiaries to merge and consolidate with other companies, incur indebtedness, grant liens or security interests on
assets, pay dividends or make other restricted payments, sell or otherwise transfer assets or enter into transactions with affiliates.
On January 7, 2022, we utilized $127 million under the Delayed Draw Term Loan facility to fund a portion of the redemptions of the Existing Domtar
Notes pursuant to the Domtar Notes Change of Control Offers that terminated on January 3, 2022. The remainder of the Delayed Draw Term Loan facility
was cancelled, leaving total drawings under the Term Loan Facility of $652 million.
Senior Secured Notes
Pearl Merger Sub Inc., was the initial issuer of the $775 million aggregate principal amount of 6.75% Senior Secured Notes due 2028 (the “Notes”), was a
newly formed, wholly-owned subsidiary of Pearl Excellence Holdco L.P., a Delaware limited partnership. This note issue was part of financing related to
the acquisition of Domtar by Pearl Excellence Holdco L.P. Upon the completion of the acquisition, the initial issuer was merged with and into Domtar with
Domtar surviving the Merger and becoming the obligor of the Notes.
The Notes mature on October 1, 2028 and interest on the Notes is payable in cash semi-annually in arrears on April 1 and October 1 of each year,
commencing on April 1, 2022.
Pending completion of the Domtar Existing Notes Change of Control Offers that terminated on January 3, 2022, $250 million of the proceeds of the Notes
issue was set aside as restricted cash to fund approximately half of funds required to complete the Change of Control Offers. Such funds are reflected as
restricted cash and included in Cash and cash equivalents on the Balance Sheet at December 31, 2021. Funds not utilized were to be used to redeem a
portion of the Senior Secured Notes at a 100% price.
Our obligations under the Senior Secured Notes are guaranteed by our immediate parent and all of the Issuer’s direct and indirect wholly-owned material
U.S. subsidiaries. Our Senior Secured Notes are secured by a lien on substantially all of the Issuer’s direct and indirect wholly-owned material U.S.
subsidiaries’ fixed assets, representing 75% of the Consolidated Fixed Assets, and a second-priority lien on the current asset collateral in the U.S. (second
in priority to the liens securing our ABL Revolving Credit Facility discussed above), in each case, subject to other permitted liens.
Our Senior Secured Notes contain customary negative covenants consistent with those applicable to the Notes, including, but not limited to, restrictions on
our ability and that of our restricted subsidiaries to merge and consolidate with other companies, incur indebtedness, grant liens or security interests on
assets, pay dividends or make other restricted payments, sell or otherwise transfer assets or enter into transactions with affiliates.
On January 7, 2022, $133 million of the Senior Secured Notes were redeemed as a result of the Domtar Existing Notes Change of Control Offers that
terminated on January 3, 2022, leaving $642 million of Notes outstanding.
Term Loan
On May 5, 2020, we entered into a $300 million Term Loan Agreement with a maturity date of May 5, 2025. We used borrowings under the Term Loan
Agreement to repay other debt, and to pay related fees and expenses. On March 11, 2021, the Company fully repaid its Term Loan Agreement, in the
amount of $294 million and wrote-off $2 million of unamortized debt issuance costs related to this repayment.
Revolving Credit Facility
We had an unsecured $700 million revolving credit facility that was terminated on November 30, 2021 and wrote-off $2 million of unamortized debt
issuance cost related to this revolving credit facility. At December 31, 2020, we had no borrowings and $54 million of letters of credits outstanding under
this facility.
Receivables Securitization
We had a $150 million receivables securitization facility that terminated in October 2021.
At December 31, 2020, we had no borrowings under the receivables securitization facility, and had no outstanding letters of credit under the facility.
In 2021, we incurred $1 million (2020 – $1 million; 2019 – $2 million) resulting from the facility. These charges were included in Interest expense, net in
the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss).
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GUARANTEES
Indemnifications
In the normal course of business, we offer indemnifications relating to the sale of our businesses and real estate. In general, these indemnifications may
relate to claims from past business operations, the failure to abide by covenants and the breach of representations and warranties included in sales
agreements. Typically, such representations and warranties relate to taxation, environmental, product and employee matters. The terms of these
indemnification agreements are generally for an unlimited period of time. At December 31, 2021, we were unable to estimate the potential maximum
liabilities for these types of indemnification guarantees as the amounts are contingent upon the outcome of future events, the nature and likelihood of which
cannot be reasonably estimated at this time. Accordingly, no provision has been recorded. These indemnifications have not yielded significant expenses in
the past.
Pension Plans
We have indemnified and held harmless the trustees of our pension funds, and the respective officers, directors, employees and agents of such trustees,
from any and all costs and expenses arising out of the performance of their obligations under the relevant trust agreements, including in respect of their
reliance on authorized instructions from us or for failing to act in the absence of authorized instructions. These indemnifications survive the termination of
such agreements. At December 31, 2021, we have not recorded a liability associated with these indemnifications, as we do not expect to make any
payments pertaining to these indemnifications.
CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS
In the normal course of business, we enter into certain contractual obligations and commercial commitments. For more information on our contractual
obligation and commercial commitments, refer to Item 8 Financial Statements and Supplementary Data under Note 11 “Leases”, Note 16 “Long-Term
Debt” and Note 20 “Commitments and Contingencies”.
In connection with the U.S. Tax Reform, we have remaining liabilities of $27 million in repatriation tax to pay through 2025. See Note 8 “Income Taxes”
for additional information on the U.S. Tax Reform.
In addition, we expect to contribute a minimum total amount of $8 million to the pension plans in 2022 and a minimum total amount of $4 million in 2022
to the other post-retirement benefits plans.
For 2022 and the foreseeable future, we expect cash flows from operations and from our various sources of financing to be sufficient to meet our
contractual obligations and commercial commitments.
RECENT ACCOUNTING PRONOUNCEMENTS
Refer to Item 8, Financial Statements and Supplementary Data under Note 2 “Recent Accounting Pronouncements”.
CRITICAL ACCOUNTING ESTIMATES AND POLICIES
Our principal accounting policies are described in Item 8, Financial Statements and Supplementary Data, under Note 1 “Summary of Significant
Accounting Policies”. Notes referenced in this section are included in Item 8, Financial Statements and Supplementary Data.
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management
to make estimates, assumptions and choices amongst acceptable accounting methods that affect our reported results of operations and financial position.
Critical accounting estimates pertain to matters that contain a significant level of management estimates about future events, encompass the most complex
and subjective judgments and are subject to a fair degree of measurement uncertainty. On an ongoing basis, management reviews its estimates, including
those related to environmental matters and asset retirement obligations, business combinations, impairment and useful lives of long-lived assets, closure
and restructuring costs, pension and other post-retirement benefit plans, income taxes and contingencies related to legal claims. These critical accounting
estimates and policies have been reviewed with the Audit Committee of our Board of Directors. We believe these accounting policies, and others as set
forth in Note 1 “Summary of Significant Accounting Policies”, should be reviewed as they are essential to understanding our results of operations, cash
flows and financial condition. Actual results could differ from those estimates.
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Environmental Matters and Asset Retirement Obligations
We maintain provisions for estimated environmental costs when remedial efforts are probable and can be reasonably estimated. Environmental provisions
relate mainly to air emissions, effluent treatment, silvicultural activities and site remediation (together referred to as “environmental matters”). The
environmental cost estimates reflect assumptions and judgments as to probable nature, magnitude and timing of required investigation, remediation and
monitoring activities, as well as contribution by other responsible parties. Additional information regarding environmental matters is available in Note 20
“Commitments and Contingencies”.
While we believe that we have determined the costs for environmental matters likely to be incurred, based on known information, our ongoing efforts to
identify potential environmental concerns that may be associated with the properties may lead to future environmental investigations. These efforts may
result in the determination of additional environmental costs and liabilities, which cannot be reasonably estimated at this time. In addition, environmental
laws and regulations and interpretation by regulatory authorities could change which could result in significant changes to our estimates. For further details
on “Climate change and air quality regulation” and other environmental matters refer to Note 20 “Commitments and Contingencies”.
Asset retirement obligations are mainly associated with landfill operation and closure, dredging of settling ponds and bark pile management. We recognize
asset retirement obligations, at fair value, in the period in which we incur a legal obligation associated with the retirement of an asset. The fair value is
based on the expected cash flow approach, in which multiple cash flow scenarios that reflect a range of possible outcomes are considered. Probabilities are
applied to each of the cash flow scenarios to arrive at an expected cash flow. The estimated cash flows are then discounted using a credit adjusted risk-free
interest rate in combination with business-specific and other relevant risks to discount the cash flow. The rates used vary between 4.7% and 12.0%.
Cash flow estimates incorporate assumptions that marketplace participants would use in their estimates of fair value, whenever that information is available
without undue cost and effort. If unavailable, assumptions are based on internal experts, third-party engineers’ studies and historical experience in
remediation work.
As at December 31, 2021, we had a total provision of $41 million for environmental matters and asset retirement obligations (2020 – $42 million). Certain
of these amounts have been discounted due to more certainty of the timing of expenditures using the credit adjusted risk-free interest rate for the
corresponding period until the settlement date. The rates used vary, based on the prevailing rate at the moment of recognition of the liability and on its
settlement period. Additional costs, not known or identified, could be incurred for remediation efforts. Based on policies and procedures in place to monitor
environmental exposure, management believes that such additional remediation costs would not have a material adverse effect on our financial position,
result of operations or cash flows.
Business Combinations
We account for business combinations using the acquisition method of accounting, which requires us to recognized the assets acquired and the liabilities
assumed at their acquisition date fair value and the recognition of acquisition-related costs in the Consolidated Statements of Earnings (Loss) and
Comprehensive Income (Loss).
The preliminary estimated fair value assigned to identifiable intangible assets acquired are determined primarily by using an income approach using a
discounted cash flow methodology, which is based on assumptions and estimates made by management. The preliminary estimated fair value of the
customer relationship intangible assets was estimated using the multi-period excess earnings method. Management applied significant judgement related to
this fair value method, which included the selection of an expected EBITDA margin assumption for the forecast period, contributory asset charges,
customer attrition rate and market-participant discount rate assumptions. These significant assumptions are based on company specific information and
projections, which are not observable in the market (except for the discount rate assumption) and, therefore, are considered Level 2 and Level 3
measurements. These significant assumptions are forward-looking and could be affected by future changes in economic and market conditions.
The fair value of property, plant and equipment was primarily determined based on management’s preliminary estimate of depreciated replacement cost as
further adjusted based on estimated cash flow forecasts. The significant assumptions underlying the fair value are based on company specific information
and projections, which are not observable in the market and, therefore, are considered Level 2 and Level 3 measurements. These significant assumptions
are forward-looking and could be affected by future changes in economic and market conditions.
The preliminary estimated fair value of finished goods was calculated as the estimated selling price, adjusted for costs of the selling effort and a reasonable
profit allowance relating to the selling effort. The preliminary estimated fair value of work in process inventory was primarily calculated as the estimated
selling price, adjusted for estimated costs to complete the manufacturing, estimated costs of the selling effort, as well as a reasonable profit margin on the
remaining manufacturing and selling effort. The preliminary estimated fair value of raw materials and operating and maintenance supplies was determined
to approximate the historical carrying value. These significant assumptions are based on company specific information and projections, which are not
observable in the market and, therefore, are considered Level 2 and Level 3 measurements. These significant assumptions are forward-looking and could be
affected by future changes in economic and market conditions.
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We generally use third-party qualified consultants to assist management in determining the fair value of assets acquired and liabilities assumed. This
includes, when necessary, assistance with the determination of economic useful lives and valuation of property, plant and equipment and identifiable
intangibles as well as assisting management in assessing off-market contracts.
The purchase price allocation process also entails us to refine these estimates over a measurement period not to exceed one year to reflect new information
obtained surrounding facts and circumstances existing at acquisition date.
The excess of the purchase price over the fair value of the identified assets acquired and liabilities assumed is recorded as goodwill.
Impairment of Property Plant and Equipment, Operating lease right-of-use assets and Definite-Lived Intangible Assets
Property, plant and equipment, operating lease right-of-use assets and definite-lived intangible assets are reviewed for impairment upon the occurrence of
events or changes in circumstances indicating that, at the lowest level of determinable cash flows, the carrying value of the assets may not be recoverable.
Step I of the impairment test assesses if the carrying value of the assets exceeds their estimated undiscounted future cash flows in order to assess if the
property, plant and equipment, operating lease right-of-use assets and definite-lived intangible assets are impaired. In the event the estimated undiscounted
future cash flows are lower than the net book value of the assets, a Step II impairment test must be carried out to determine the impairment charge. In
Step II, the assets are written down to their estimated fair values. Given that there is generally no readily available quoted value for our property, plant and
equipment, operating lease right-of-use assets and definite-lived intangible assets, we determine fair value of our assets based on the present value of
estimated future cash flows expected from their use and eventual disposition, and by using the liquidation or salvage value in the case of idled assets. The
fair value estimate in Step II is based on the undiscounted cash flows used in Step I.
Estimates of undiscounted future cash flows used to test the recoverability of the property, plant and equipment, operating lease right-of use assets and
definite-lived intangible assets includes key assumptions related to selling prices, inflation-adjusted cost projections, forecasted exchange rates (when
applicable) and estimated useful life. Changes in our assumptions and estimates may affect our forecasts and may lead to an outcome where impairment
charges would be required. In addition, actual results may vary from our forecasts, and such variations may be material and unfavorable, thereby triggering
the need for future impairment tests where our conclusions may differ in reflection of prevailing market conditions.
Useful Lives
On a regular basis, we review the estimated useful lives of our property, plant and equipment and our definite-lived intangible assets. Assessing the
reasonableness of the estimated useful lives of property, plant and equipment and definite-lived intangible assets requires judgment and is based on
currently available information. Changes in circumstances such as technological advances, changes to our business strategy, changes to our capital strategy
or changes in regulation can result in useful lives differing from our estimates. Revisions to the estimated useful lives of property, plant and equipment and
definite-lived intangible assets constitute a change in accounting estimate and are dealt with prospectively by amending depreciation and amortization rates.
A change in the remaining estimated useful life of a group of assets, or their estimated net salvage value, will affect the depreciation or amortization rate
used to depreciate or amortize the group of assets and thus affect depreciation or amortization expense as reported in our results of operations.
Closure and Restructuring Costs
Closure and restructuring costs are recognized as liabilities in the period when they are incurred and are measured at their fair value. For such recognition
to occur, management, with the appropriate level of authority, must have approved and committed to a firm plan and appropriate communication to those
affected must have occurred. These provisions may require an estimation of costs such as severance and termination benefits, pension and related
curtailments, environmental remediation and may also include expenses related to demolition and outplacement. Actions taken may also require an
evaluation of any remaining assets to determine required impairments, if any, and a review of estimated remaining useful lives which may lead to
accelerated depreciation expense.
Estimates of cash flows and fair value relating to closures and restructuring require judgment. Closure and restructuring liabilities are based on
management’s best estimates of future events. Although we do not anticipate significant changes, actual costs may differ from these estimates due to
subsequent business developments. As such, additional costs and further impairment charges may be required in future periods.
Additional information can be found under Note 14 “Closure and Restructuring Costs and Impairment of Long-Lived Assets”.
35
Pension Plans and Other Post-Retirement Benefit Plans
We have several defined contribution plans. The pension expense under these plans is equal to our contribution.
We sponsor both contributory and non-contributory U.S. and non-U.S. defined benefit pension plans. We also sponsor a number of other post-retirement
benefit plans for eligible U.S. and non-U.S. employees; the plans are unfunded and include life insurance programs and medical and dental benefits. In
addition, we provide supplemental unfunded defined benefit pension plans and supplemental unfunded defined contribution pension plans to certain senior
management employees.
We account for pensions and other post-retirement benefits in accordance with Compensation-Retirement Benefits Topic of the Financial Accounting
Standards Board-Accounting Standards Committee which requires employers to recognize the overfunded or underfunded status of defined benefit pension
plans as an asset or liability in its Consolidated Balance Sheets. Pension and other post-retirement benefit charges require assumptions in order to estimate
the projected and accumulated benefit obligations. These assumptions require considerable management judgment and include:
-
-
-
-
-
Expected long-term rate of return on plan assets – used to estimate the growth and expected return on assets
Discount rate – used to determine interest costs and the net present value of our obligations
Rate of compensation increase – used to calculate the impact of future increases on our obligations
Health care cost trends – used to calculate the impact of future health care costs on our obligations
Employee related factors, such as mortality rates, turnover, retirement age and disabilities – used to determine the extent of our obligations
Changes in these assumptions result in actuarial gains or losses, which are amortized over the expected average remaining service life of the active
employee group covered by the plans, only to the extent that the unrecognized net actuarial gains and losses are in excess of 10% of the greater of the
projected benefit obligation and the market value of assets, over the average remaining service period of approximately ten years of the active employee
group covered by the pension plans, and 11 years of the active employee group covered by the other post-retirement benefits plans.
An expected rate of return on plan assets of 4.4% was considered appropriate by management for the determination of pension expense for 2021. Effective
January 1, 2022, we will use 4.8% as the expected return on plan assets, which reflects the current view of long-term investment returns. The overall
expected long-term rate of return on plan assets is based on management’s best estimate of the long-term returns of the major asset classes (cash and cash
equivalents, equities, bonds and various alternative investment asset classes) weighted by the target allocation of assets at the measurement date, net of
expenses. This rate includes an equity risk premium over government bond returns for equity investments and a value-added premium for the contribution
to returns from active management. The sources used to determine management's best estimate of long-term returns are numerous and include country
specific bond yields, which may be derived from the market using local bond indices or by analysis of the local bond market, and country-specific inflation
and investment market expectations derived from market data and analysts' or governments' expectations, as applicable.
We set our discount rate assumption annually to reflect the rates available on high-quality, fixed income debt instruments, with a duration that is expected
to match the timing and amount of expected benefit payments. High-quality debt instruments are corporate bonds with a rating of AA or better. The
discount rates at December 31, 2021 for pension plans were estimated at 3.0% for the projected benefit obligation and 3.0% (2.5% at November 30, 2021)
for the net periodic benefit cost for 2021 and for post-retirement benefit plans were estimated at 3.1% for the projected benefit obligation and 3.2% (2.3%
at November 30, 2021) for the net periodic benefit cost for 2021.
We used a full yield curve approach to estimate the current service and interest cost components of net periodic benefit cost for Canadian pension plans and
U.S. funded pension plans. The estimate of these components is made by applying the specific spot rates along the yield curve used in the determination of
the benefit obligation to the relevant projected cash flows. We used this approach to provide a more precise measurement of current service and interest
cost components by improving the correlation between projected benefit cash flows to the corresponding spot yield curve rates.
The rate of compensation increase is another significant assumption in the actuarial model for pension (set at 2.7% for the projected benefit obligation and
2.8% for the net periodic benefit cost (2.7% at November 30, 2021) and for post-retirement benefit plans (set at 2.9% for the projected benefit obligation
and 2.8% (2.6% at November 30, 2021) for the net periodic benefit cost) and is determined based upon our long-term plans for such increases.
For employee related factors, mortality rate tables tailored to our industry were used and the other factors reflect our historical experience and
management’s best estimate regarding future expectations.
36
For measurement purposes, a 3.9% weighted average annual rate of increase in the per capita cost of covered health care benefits was assumed for 2021.
The following table provides a sensitivity analysis of the key weighted average economic assumptions used in measuring the projected pension benefit
obligation, the accrued other post-retirement benefit obligation and related net periodic benefit cost for 2021. The sensitivity analysis should be used with
caution as it is hypothetical and changes in each key assumption may not be linear. The sensitivities in each key variable have been calculated
independently of each other.
PENSION AND OTHER POST-RETIREMENT BENEFIT
PLANS
Projected Benefit
Obligation
Net Periodic Benefit
Cost
Projected Benefit
Obligation
Net Periodic Benefit
Cost
Pension
Other Post-Retirement Benefit
(In millions of dollars)
Expected rate of return on assets
Impact of:
1% increase
1% decrease
Discount rate
Impact of:
1% increase
1% decrease
N/A
N/A
(168)
194
(15)
15
(9)
15
N/A
N/A
(6)
8
N/A
N/A
-
-
Our pension plan funding policy is to contribute annually the amount required to provide for benefits earned in the year and to fund solvency deficiencies,
funding shortfalls and past service obligations over periods not exceeding those permitted by the applicable regulatory authorities. Past service obligations
primarily arise from improvements to plan benefits. The other post-retirement benefit plans are not funded, and contributions are made annually to cover
benefit payments.
We expect to contribute a minimum total amount of $8 million in 2022 compared to $17 million in 2021 (2020 – $15 million) to the pension plans. We
expect to contribute a minimum total amount of $5 million in 2022 compared to $4 million in 2021 to the other post-retirement benefit plans (2020 –
$4 million).
Benefit obligations and fair values of plan assets as of December 31, 2021 for our pension and post-retirement plans were as follows:
Projected benefit obligation at end of year
Fair value of assets at end of year
Funded status
Successor
December 31, 2021
Pension
plans
$
(1,433)
1,622
189
Other
post-retirement
benefit plans
$
(60)
—
(60)
Predecessor
December 31, 2020
Pension
plans
$
(1,566)
1,594
28
Other
post-retirement
benefit plans
$
(67)
—
(67)
For additional details on our pension plans and other post-retirement benefit plans, refer to Note 6 “Pension Plans and Other Post-Retirement Benefit
Plans”.
Income Taxes
We use the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined according to
differences between the carrying amounts and tax bases of the assets and liabilities. The change in the net deferred tax asset or liability is included in
earnings. Deferred tax assets and liabilities are measured using enacted tax rates and laws expected to apply in the years in which assets and liabilities are
expected to be recovered or settled. Deferred tax assets and liabilities are classified as non-current items on the Consolidated Balance Sheets. For these
years, a projection of taxable income and an assumption of the ultimate recovery or settlement period for temporary differences are required. The projection
of future taxable income is based on management’s best estimate and may vary from actual taxable income.
On a quarterly basis, we assess the need to establish a valuation allowance for deferred tax assets and, if it is deemed more likely than not that our deferred
tax assets will not be realized based on these taxable income projections, a valuation allowance is recorded. In general, “realization” refers to the
incremental benefit achieved through the reduction in future taxes payable or an increase in future taxes refundable from the deferred tax assets. Evaluating
the need for an amount of a valuation allowance for deferred tax assets often requires significant judgment. All available evidence, both positive and
negative, should be considered to determine whether, based on the weight of that evidence, a valuation allowance is needed.
37
In our evaluation process, we give the most weight to historical income or losses. After evaluating all available positive and negative evidence, although
realization is not assured, we determined that it is more likely than not that the results of future operations will generate sufficient taxable income to realize
the deferred tax assets, with the exception of certain state credits and losses for which a valuation allowance of $15 million exists at December 31, 2021,
and capital loss carryforwards for which a valuation allowance of $43 million exists at December 31, 2021. Of this amount, $1 million unfavorably
impacted tax expense and the effective tax rate for 2021 (2020 –$47 million).
Our deferred tax assets are mainly composed of temporary differences related to various accruals, accounting provisions, net operating loss carryforwards,
and available tax credits. Our deferred tax liabilities are mainly composed of temporary differences pertaining to property, plant and equipment, intangible
assets, pension and post-retirement benefit assets, leases and other items. Estimating the ultimate settlement period requires judgment. The reversal of
timing differences is expected at enacted tax rates, which could change due to changes in income tax laws or the introduction of tax changes through the
presentation of annual budgets by different governments. As a result, a change in the timing and the income tax rate at which the components will reverse
could materially affect deferred tax expense in our future results of operations.
In addition, U.S. and foreign tax rules and regulations are subject to interpretation and require judgment that may be challenged by taxation authorities. To
the best of our knowledge, we have adequately provided for our future tax consequences based upon current facts and circumstances and current tax law. In
accordance with Income Taxes Topic of FASB ASC 740, we evaluate new tax positions that result in a tax benefit to us and determine the amount of tax
benefits that can be recognized. The remaining unrecognized tax benefits are evaluated on a quarterly basis to determine if changes in recognition or
classification are necessary. Significant changes in the amount of unrecognized tax benefits expected within the next 12 months are disclosed quarterly.
Future recognition of unrecognized tax benefits would impact the effective tax rate in the period the benefits are recognized. As of December 31, 2021, we
had gross unrecognized tax benefits of $22 million (2020 – $23 million). These amounts represent the gross amount of exposure in individual jurisdictions
and do not reflect any additional benefits expected to be realized if such positions were sustained, such as federal deduction that could be realized if an
unrecognized state deduction was not sustained. As of December 31, 2021, we believe it is reasonably possible that up to $4 million of our unrecognized
tax benefits may be recognized in 2022, which could significantly impact the effective tax rate. However, the amount and timing of the recognition of these
benefits is subject to some uncertainty. In addition, a number of countries are actively pursuing changes to their tax laws applicable to corporation
multinationals, such as the U.S. Tax Reform, enacted in 2017. Finally, foreign governments may enact tax laws in response to the U.S. Tax Reform that
could result in further changes to global taxation and materially impact our financial results.
We operate in multiple jurisdictions with complex tax policy and regulatory environments. U.S. and foreign tax rules and regulations are subject to
interpretation and require judgment that may be challenged by taxation authorities. Tax audits by their nature are often complex and can require several
years to resolve. We have a number of audits in process in various jurisdictions. Although the resolution of these tax positions is uncertain, based on
currently available information, we believe that we have adequately provided for our future tax consequences based upon current facts and circumstances
and current tax law, and we believe that the ultimate outcomes will not have a material adverse effect on our financial position, results of operations or cash
flows. For further details refer to Note 8 “Income Taxes”.
Contingencies related to legal claims
As discussed in Item 1A Risk Factors, under the risk “Failure to comply with applicable laws and regulations could have a material adverse effect on our
business, financial results or condition” and in Note 20 “Commitments and Contingencies”, we are subject to various legal proceedings and claims that
arise in the ordinary course of business. We record a liability when it is probable that a loss has been incurred, and the amount is reasonably estimable. The
most likely cost to be incurred is accrued based on an evaluation of the then available facts with respect to each matter. When no amount within a range of
estimates is more likely, the minimum is accrued. There is significant judgment required in both the probability determination and as to whether an
exposure can be reasonably estimated. For further details on “Contingencies” and legal claims refer to Note 20 “Commitments and Contingencies”.
38
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
Our operating income can be impacted by the following sensitivities:
SENSITIVITY ANALYSIS
(In millions of dollars, unless otherwise noted)
Each $10/unit change in the selling price of the following
products1:
Papers
Business Papers
Commercial Print & Publishing Papers
Specialty & Packaging Papers
Pulp - net position
Fluff
Softwood
Hardwood
Foreign exchange
(US $0.01 change in relative value to the Canadian dollar before
hedging)
Energy 2
Natural gas: $0.25/MMBtu change in price before hedging
$
$
11
8
4
6
8
-
9
7
1
2
Based on estimated 2022 capacity (ST or ADMT).
Based on estimated 2022 consumption levels. The allocation between energy sources may vary during the year in order to take advantage of market
conditions.
Note that we may, from time to time, hedge part of our foreign exchange, and energy positions, which may therefore impact the above sensitivities.
In the normal course of business, we are exposed to certain financial risks. We do not use derivative instruments for speculative purposes; although all
derivative instruments purchased to minimize risk may not qualify for hedge accounting.
CREDIT RISK
We are exposed to credit risk on accounts receivables from our customers. In order to reduce this risk, we review new customers’ credit history before
granting credit and conduct regular reviews of existing customers’ credit performance. As of December 31, 2021, two of our customers located in the U.S.
represented 28% or $130 million of our receivables (December 31, 2020 – two customers located in the U.S. represented 29% or $104 million).
We are exposed to credit risk in the event of non-performance by counterparties to our financial instruments. We attempt to minimize this exposure by
entering into contracts with counterparties that are believed to be of high credit quality. Collateral or other security to support financial instruments subject
to credit risk is usually not obtained. The credit standing of counterparties is regularly monitored.
INTEREST RATE RISK
We are exposed to interest rate risk arising from fluctuations in interest rates on our cash and cash equivalents, bank indebtedness, ABL Revolving Credit
Facility, Term Loan Facility and long-term debt. Our objective in managing exposure to interest rate changes is to minimize the impact of interest rate
changes on earnings and cash flows and to lower our overall borrowing costs. We may manage this interest rate exposure through the use of derivative
instruments such as interest rate swap contracts, whereby we agree to exchange the difference between fixed and variable interest amounts calculated by
reference to an agreed upon notional principal amount.
COST RISK
Cash flow hedges
We are exposed to price volatility for raw materials and energy used in our manufacturing process. We manage our exposure to cost risk primarily through
the use of supplier contracts. We purchase natural gas at the prevailing market price at the time of delivery. To reduce the impact on cash flow and earnings
due to pricing volatility, we may utilize derivatives to fix the price of forecasted natural
39
gas purchases. The changes in the fair value on qualifying instruments are included in Accumulated other comprehensive loss to the extent effective and
reclassified into Cost of sales in the period during which the hedged transaction affects earnings.
FOREIGN CURRENCY RISK
Cash flow hedges
We have manufacturing operations in the U.S. and Canada. As a result, we are exposed to movements in foreign currency exchange rates in Canada.
Moreover, certain assets and liabilities are denominated in Canadian dollars and are exposed to foreign currency movements. Accordingly, our earnings are
affected by increases or decreases in the value of the Canadian dollar. Our risk management policy allows us to hedge a significant portion of the exposure
to fluctuations in foreign currency exchange rates for periods up to three years. We may use derivative financial instruments (currency options and foreign
exchange forward contracts) to mitigate our exposure to fluctuations in foreign currency exchange rates.
Derivatives are used to hedge forecasted purchases in Canadian dollars by our Canadian subsidiary. Such derivatives are designated as cash flow hedges.
The changes in the fair value on qualifying instruments are included in Accumulated other comprehensive loss to the extent effective and reclassified into
Sales or Cost of sales in the period during which the hedged transaction affects earnings.
40
PART II
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Management’s Reports to Shareholders of Domtar Corporation
Management’s Report on Financial Statements and Practices
The accompanying Consolidated Financial Statements of Domtar Corporation and its subsidiaries (the “Company”) were prepared by management. The
statements were prepared in accordance with accounting principles generally accepted in the United States of America and include amounts that are based
on management’s best judgments and estimates. Management is responsible for the completeness, accuracy and objectivity of the financial statements. The
other financial information included in the annual report is consistent with that in the financial statements.
Management has established and maintains a system of internal accounting and other controls for the Company and its subsidiaries. This system and its
established accounting procedures and related controls are designed to provide reasonable assurance that assets are safeguarded, that the books and records
properly reflect all transactions, that policies and procedures are implemented by qualified personnel, and that published financial statements are properly
prepared and fairly presented. The Company’s system of internal control is supported by written policies and procedures, contains self-monitoring
mechanisms, and is audited by the internal audit function. Appropriate actions are taken by management to correct deficiencies as they are identified.
Management’s Report on Internal Control over Financial Reporting
Management is responsible for establishing and maintaining adequate internal control over financial reporting for the Company. Management has evaluated
the effectiveness of internal control over financial reporting, using the criteria established in 2013 Internal Control – Integrated Framework, issued by the
Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). The Company’s internal control over financial reporting is designed to
provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles. The Company’s internal control over financial reporting includes those policies and procedures that
(i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the
Company; (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with
accounting principles generally accepted in the United States of America, and that receipts and expenditures of the Company are being made only in
accordance with authorizations of management and directors of the Company; and (iii) provide reasonable assurance regarding prevention or timely
detection of unauthorized 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 of
effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.
Based on the assessment, management has concluded that the Company maintained effective internal control over financial reporting as of December 31,
2021, based on criteria in Internal Control – Integrated Framework issued in 2013 by the COSO.
41
To the Board of Directors and Shareholders of Domtar Corporation
Opinion on the Financial Statements
Report of Independent Registered Public Accounting Firm
We have audited the accompanying consolidated balance sheet of Domtar Corporation and its subsidiaries (“Successor”) (the “Company”) as of December
31, 2021, and the related consolidated statements of earnings (loss) and comprehensive income (loss), of shareholders' equity (deficit) and of cash flows for
the period from December 1, 2021 through December 31, 2021, including the related notes and schedule of valuation and qualifying accounts for the period
from December 1, 2021 through December 31, 2021 appearing after the list of exhibits under Item 15(a)(3) (collectively referred to as the “consolidated
financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as
of December 31, 2021 and the results of its operations and its cash flows for the period from December 1, 2021 to December 31, 2021 in conformity with
accounting principles generally accepted in the United States of America.
Basis for Opinion
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s
consolidated financial statements based on our audit. We are a public accounting firm registered with the Public Company Accounting Oversight Board
(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit of these consolidated financial statements in accordance with the standards of the PCAOB and in accordance with auditing
standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have,
nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audit we are required to obtain an understanding of
internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control over
financial reporting. Accordingly, we express no such opinion.
Our audit included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or
fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and
disclosures in the consolidated financial statements. Our audit also included evaluating the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audit provides a reasonable basis
for our opinion.
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was
communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated
financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not
alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below,
providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Paper Excellence Merger - Valuation of Acquired Customer Relationships Intangible Assets
As described in Notes 1 and 4 to the consolidated financial statements, on November 30, 2021, Paper Excellence completed the acquisition of all the
outstanding common shares of the Company by means of a merger of Pearl Merger Sub with and into the Company, with the Company continuing as the
surviving corporation and as a subsidiary of Paper Excellence. The acquisition-date fair value of the consideration transferred totaled $2.796 billion, less
cash acquired of $332 million. The merger resulted in a new basis of accounting basis of the Company’s assets and liabilities which are measured at fair
value at the acquisition date. The preliminary estimated fair value of the customer relationships intangible assets of $170 million was estimated using the
multi-period excess earnings method. Management applied significant judgment related to this fair value method, which included the selection of an
expected EBITDA margin assumption for the forecast period, contributory asset charges, customer attrition rate and market-participant discount rate
assumptions. These significant assumptions are forward-looking and could be affected by future changes in economic and market conditions.
42
The principal considerations for our determination that performing procedures relating to the valuation of acquired customer relationships intangible assets
recorded in connection with the Paper Excellence merger is a critical audit matter are (i) the significant judgment by management when developing the fair
value of the customer relationships intangible assets; (ii) a high degree of auditor judgment, subjectivity, and effort in performing procedures and evaluating
management’s significant assumptions related to the expected EBITDA margins for the forecast period, contributory asset charges and market-participant
discount rate; and (iii) the audit effort involved the use of professionals with specialized skill and knowledge.
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated
financial statements. These procedures included, among others (i) reading the purchase agreement, (ii) testing management’s process for developing the fair
value of the customer relationships intangible assets; (iii) evaluating the appropriateness of the multi-period excess earnings method, (iv) testing the
completeness and accuracy of the underlying data used in the method, and (v) evaluating the reasonableness of significant assumptions used by
management related to the expected EBITDA margins for the forecast period, contributory asset charges and market-participant discount rate. Evaluating
whether management’s assumptions related to the expected EBITDA margins for the forecast period were reasonable involved consideration of (i) the
current and past performance of the Company; and (ii) consistency with evidence obtained in other areas of the audit. Professionals with specialized skill
and knowledge were used to assist in the evaluation of the (i) appropriateness of the multi-period excess earnings method and (ii) the reasonableness of the
contributory asset charges and the market-participant discount rate assumptions.
/s/ PricewaterhouseCoopers LLP
Charlotte, North Carolina
March 10, 2022
We have served as the Company’s auditor since 2007.
43
To the Board of Directors and Shareholders of Domtar Corporation:
Opinion on the Financial Statements
Report of Independent Registered Public Accounting Firm
We have audited the accompanying consolidated balance sheet of Domtar Corporation and its subsidiaries (“Predecessor”) (the “Company”) as of
December 31, 2020 and the related consolidated statements of earnings (loss) and comprehensive income (loss), of shareholders' equity (deficit) and of
cash flows for the period from January 1, 2021 through November 30, 2021, and for each of the two years in the period ended December 31, 2020,
including the related notes and schedule of valuation and qualifying accounts for the period from January 1, 2021 through November 30, 2021, and for each
of the two years in the period ended December 31, 2020 appearing after the list of exhibits under Item 15(a)(3) (collectively referred to as the “consolidated
financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as
of December 31, 2020, and the results of its operations and its cash flows for the period from January 1, 2021 through November 30, 2021, and for each of
the two years in the period ended December 31, 2020 in conformity with accounting principles generally accepted in the United States of America.
Basis for Opinions
These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s
consolidated financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board
(United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the
applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits of these consolidated financial statements in accordance with the standards of the PCAOB and in accordance with auditing
standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud.
Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or
fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and
disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by
management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis
for our opinion.
Critical Audit Matters
The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was
communicated or required to be communicated to the audit committee and that (i) relates to accounts or disclosures that are material to the consolidated
financial statements and (ii) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not
alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below,
providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Revenue Recognition
As described in Note 1 to the consolidated financial statements, revenue is generated from the sale of finished goods to customers. Revenue is recognized at
a single point in time when the performance obligation is satisfied which occurs when the control over the goods is transferred to customers. The point in
time when the control of goods is transferred to customers is largely dependent on delivery terms. Revenue is recorded at the time of shipment for delivery
terms designated free on board (“f.o.b.”) shipping point. For sales transactions designated f.o.b. destination, revenue is recorded when the product is
delivered to the customer’s delivery site. Revenue is measured as the amount of consideration the Company expects to receive in exchange for goods
transferred to customers. Revenue is recognized net of variable consideration in the form of rebates, discounts and other commercial incentives extended to
customers. Variable consideration is recognized using the most likely amounts which are based on an analysis of historical experience and current period
expectations. Management includes estimated amounts of variable consideration in revenue to the extent that it is probable that there will not be a
significant reversal of recognized revenue when the uncertainty related to that variable consideration is resolved. The Company’s revenue was $3,368
million for the period from January 1, 2021 through November 30, 2021.
The principal considerations for our determination that performing procedures relating to revenue recognition is a critical audit matter are a high degree of
auditor effort in performing procedures and evaluating audit evidence related to the Company’s revenue recognition.
44
Addressing the matter involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated
financial statements. These procedures included, among others, evaluating, for a sample of revenue transactions, the recognition of revenue by obtaining
and inspecting source documents, including invoices, sales contracts, shipping and delivery documents and, where applicable, cash receipts.
/s/ PricewaterhouseCoopers LLP
Charlotte, North Carolina
March 10, 2022
We have served as the Company’s auditor since 2007.
45
DOMTAR CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS (LOSS) AND COMPREHENSIVE INCOME (LOSS)
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
Sales
Operating expenses
Cost of sales, excluding depreciation and amortization
Depreciation and amortization
Selling, general and administrative
Impairment of long-lived assets (NOTE 14)
Closure and restructuring costs (NOTE 14)
Asset conversion costs (NOTE 14)
Transaction costs (NOTE 4)
Other operating (income) loss, net
Operating income (loss) from continuing operations
Interest expense, net (NOTE 7)
Non-service components of net periodic benefit cost (NOTE 6)
(Loss) earnings before income taxes and equity loss
Income tax (benefit) expense (NOTE 8)
Equity method investment loss, net of taxes
(Loss) earnings from continuing operations
Earnings from discontinued operations, net of taxes (NOTE 3)
Net (loss) earnings
Other comprehensive income:
Net derivative gains (losses) on cash flow hedges:
Net gains arising during the period, net
of tax of nil and $(8) (2020 – $(9); 2019 – $(3))
Less: Reclassification adjustment for (gains) losses included in
net (loss) earnings, net of tax of nil and $8 (2020 – $(4);
2019 – $(3))
Foreign currency translation adjustments
Change in unrecognized gains (losses) and prior service cost
related to pension and post-retirement benefit plans, net of tax of
$(5) and $(33) (2020 – $4; 2019 – $(13))
Other comprehensive income
Comprehensive income (loss)
Successor
Period from
December 1,
through
December 31,
2021
$
300
Period from
January 1,
through
November 30,
2021
$
3,368
Predecessor
Year ended
December 31,
2020
$
3,415
Year ended
December 31,
2019
$
4,119
251
23
23
—
(1)
3
—
—
299
1
10
(2)
(7)
(2)
—
(5)
1
(4)
—
—
8
16
24
20
2,771
182
246
9
17
27
132
(5)
3,379
(11)
54
(22)
(43)
6
—
(49)
26
(23)
24
(31)
57
99
149
126
2,914
208
252
136
99
—
—
(7)
3,602
(187)
58
(17)
(228)
(80)
3
(151)
24
(127)
27
12
63
(13)
89
(38)
3,402
216
289
32
22
—
—
4
3,965
154
52
23
79
11
2
66
18
84
11
8
21
34
74
158
The accompanying notes are an integral part of the consolidated financial statements.
46
DOMTAR CORPORATION
CONSOLIDATED BALANCE SHEETS
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
Successor
Predecessor
At
December 31,
2021
$
December 31,
2020
$
Assets
Current assets
Cash and cash equivalents, including restricted cash of $250 and nil
Receivables, less allowances of $4 and $6
Inventories (NOTE 9)
Prepaid expenses
Income and other taxes receivable
Assets held for sale (NOTE 3)
Total current assets
Property, plant and equipment, net (NOTE 10)
Operating lease right-of-use assets (NOTE 11)
Intangible assets, net (NOTE 12)
Other assets (NOTE 13)
Non-current asset held for sale (NOTE 3)
Total assets
Liabilities and shareholders' equity
Current liabilities
Trade and other payables (NOTE 15)
Income and other taxes payable
Operating lease liabilities due within one year (NOTE 11)
Long-term debt due within one year (NOTE 17)
Liabilities held for sale (NOTE 3)
Total current liabilities
Long-term debt (NOTE 17)
Operating lease liabilities (NOTE 11)
Deferred income taxes and other (NOTE 8)
Other liabilities and deferred credits (NOTE 18)
Long-term liabilities held for sale (NOTE 3)
Commitments and contingencies (NOTE 20)
Shareholders' equity (NOTE 19)
Common stock $0.01 par value; 100 shares issued and outstanding at
December 31, 2021
Common stock $0.01 par value; 2,000,000,000 shares authorized, 65,001,104 shares
issued at December 31, 2020
Treasury stock $0.01 par value; nil and 9,806,566 shares
Additional paid-in capital
(Deficit) retained earnings
Accumulated other comprehensive income (loss)
Total shareholders' equity
Total liabilities and shareholders' equity
The accompanying notes are an integral part of the consolidated financial statements.
47
286
463
663
44
59
287
1,802
2,524
48
207
273
—
4,854
543
11
19
259
63
895
1,643
36
525
216
—
—
—
—
1,555
(40)
24
1,539
4,854
309
355
562
50
54
1,226
2,556
1,920
59
29
189
103
4,856
456
15
20
13
336
840
1,079
50
308
310
9
—
1
—
1,717
846
(304)
2,260
4,856
DOMTAR CORPORATION
CONSOLIDATED STATEMENT OF SHAREHOLDERS’ EQUITY (DEFICIT)
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
Predecessor
Balance at December 31, 2018
Stock-based compensation, net of tax
Net earnings
Net derivative gains on cash flow hedges:
Net gains arising during the period, net of tax of $(3)
Less: Reclassification adjustment for losses included
in net earnings, net of tax of $(3)
Foreign currency translation adjustments
Change in unrecognized gains and prior service cost related to
pension and post-retirement benefit plans, net of tax of $(13)
Stock repurchase
Cash dividends declared
Balance at December 31, 2019
Stock-based compensation, net of tax
Net loss
Net derivative gains on cash flow hedges:
Net gains arising during the period, net of tax of $(9)
Less: Reclassification adjustment for losses included
in net loss, net of tax of $(4)
Foreign currency translation adjustments
Change in unrecognized losses and prior service cost related to
pension and post-retirement benefit plans, net of tax of $4
Stock repurchase
Cash dividends declared
Balance at December 31, 2020
Stock-based compensation, net of tax
Net loss
Net derivative losses on cash flow hedges:
Net gains arising during the period, net of tax of $(8)
Less: Reclassification adjustment for gains included
in net loss, net of tax of $8
Foreign currency translation adjustments
Change in unrecognized gains and prior service cost
related to pension and post-retirement benefit plans,
net of tax of $(33)
Stock repurchase
Successor
Buy-out of predecessor equity
Capital contribution
Net loss
Foreign currency translation adjustments
Change in unrecognized gains and prior service cost
related to pension and post-retirement benefit plans,
net of tax of $(5)
Balance at December 31, 2021
Issued and
outstanding
common
shares
(millions of
shares)
Common
stock, at par
Additional
paid-in
capital
Retained
earnings
(deficit)
Accumulated
other
comprehensive
income (loss)
Total
shareholders’
equity
62.9
0.2
—
—
—
—
—
(6.2)
—
56.9
0.1
—
—
—
—
—
(1.8)
—
55.2
0.3
—
—
—
—
—
(5.1)
(50.4)
—
—
—
—
—
$
1
—
—
—
—
—
—
—
—
1
—
—
—
—
—
—
—
—
1
—
—
—
—
—
—
—
(1)
—
—
—
—
—
$
1,981
8
—
—
—
—
—
(219)
—
1,770
6
—
—
—
—
—
(59)
—
1,717
(5)
—
—
—
—
—
(238)
(1,474)
1,555
—
—
—
1,555
$
1,023
—
84
—
—
—
—
—
(109)
998
—
(127)
—
—
—
—
—
(25)
846
—
(23)
—
—
—
—
—
(859)
—
(4)
—
—
(40)
$
(467)
—
—
11
8
21
34
—
—
(393)
—
—
27
12
63
(13)
—
—
(304)
—
—
24
(31)
57
99
—
155
—
—
8
$
2,538
8
84
11
8
21
34
(219)
(109)
2,376
6
(127)
27
12
63
(13)
(59)
(25)
2,260
(5)
(23)
24
(31)
57
99
(238)
(2,179)
1,555
(4)
8
16
24
16
1,539
The accompanying notes are an integral part of the consolidated financial statements
48
DOMTAR CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN MILLIONS OF DOLLARS)
Successor
Predecessor
Period from
December 1,
through
December 31,
2021
$
Period from
January 1,
through
November 30,
2021
$
Year ended
December 31,
2020
$
Year ended
December 31,
2019
$
Operating activities
Net (loss) earnings
Adjustments to reconcile net (loss) earnings to cash flows (used for)
provided from operating activities
Depreciation and amortization
Deferred income taxes and tax uncertainties (NOTE 8)
Impairment of long-lived assets (NOTE 14)
Impairment of inventory (NOTE 14)
Net gains on disposals of property, plant and equipment
Net loss on disposition of discontinued operations (NOTE 3)
Stock-based compensation expense
Equity method investment loss, net of taxes
Make-whole premium on repayment of long-term debt (NOTE 17)
Other
Changes in assets and liabilities, excluding the effect of acquisitions
and sale of businesses
Receivables
Inventories
Prepaid expenses
Trade and other payables
Income and other taxes
Difference between employer pension and other post-retirement
contributions and pension and other post-retirement expense
Other assets and other liabilities
Cash flows (used for) provided from operating activities
Investing activities
Additions to property, plant and equipment
Proceeds from disposals of property, plant and equipment
Proceeds from sale of business, net of cash disposed (NOTE 3)
Acquisition of businesses (NOTE 4)
Cash flows (used for) provided from investing activities
Financing activities
Dividend payments
Stock repurchase
Issuance of common shares
Net change in bank indebtedness
Change in revolving credit facility
Proceeds from receivables securitization facility
Repayments of receivables securitization facility
Issuance of long-term debt, net of debt issue costs
Repayments of long-term debt, including make-whole premium
Other
Cash flows provided from (used for) financing activities
Net (decrease) increase in cash and cash equivalents
Impact of foreign exchange on cash
Cash, cash equivalents and restricted cash at beginning of period
Cash, cash equivalents and restricted cash at end of period
Supplemental cash flow information
Net cash payments (refund) for:
Interest (including $11 million of make-whole premium in 2021)
Income taxes
The accompanying notes are an integral part of the consolidated financial statements.
49
(4)
(23)
(127)
23
(10)
—
—
—
—
—
—
—
4
45
(19)
4
(126)
(17)
(2)
—
(102)
(41)
—
—
(2,796)
(2,837)
—
—
1,555
—
115
—
—
1,252
—
—
2,922
(17)
—
303
286
—
17
205
(8)
9
—
(3)
33
28
—
11
8
(163)
(4)
7
118
5
(17)
—
206
(268)
4
897
—
633
—
(238)
—
—
—
—
—
—
(606)
(1)
(845)
(6)
—
309
303
53
22
283
(45)
137
31
(1)
45
8
3
—
4
99
7
11
(57)
13
(4)
4
411
(175)
3
—
(30)
(202)
(51)
(59)
—
(10)
(80)
25
(80)
300
(7)
(3)
35
244
4
61
309
52
(22)
84
293
(16)
58
6
—
—
9
2
—
—
96
(22)
2
(67)
(43)
29
11
442
(255)
1
—
—
(254)
(110)
(219)
—
9
80
205
(200)
—
(1)
(1)
(237)
(49)
(1)
111
61
46
59
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
INDEX FOR NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
RECENT ACCOUNTING PRONOUNCEMENTS
DISCONTINUED OPERATIONS
ACQUISITION OF BUSINESSES
STOCK-BASED COMPENSATION
PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS
INTEREST EXPENSE, NET
INCOME TAXES
INVENTORIES
PROPERTY, PLANT AND EQUIPMENT
LEASES
INTANGIBLE ASSETS
OTHER ASSETS
CLOSURE AND RESTRUCTURING COSTS AND IMPAIRMENT OF LONG-LIVED ASSETS
TRADE AND OTHER PAYABLES
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT
LONG-TERM DEBT
OTHER LIABILITIES AND DEFERRED CREDITS
SHAREHOLDERS’ EQUITY
COMMITMENTS AND CONTINGENCIES
DERIVATIVES AND HEDGING ACTIVITIES AND FAIR VALUE MEASUREMENT
SEGMENT DISCLOSURES
RELATED PARTY TRANSACTIONS
NOTE 1
NOTE 2
NOTE 3
NOTE 4
NOTE 5
NOTE 6
NOTE 7
NOTE 8
NOTE 9
NOTE 10
NOTE 11
NOTE 12
NOTE 13
NOTE 14
NOTE 15
NOTE 16
NOTE 17
NOTE 18
NOTE 19
NOTE 20
NOTE 21
NOTE 22
NOTE 23
50
51
59
60
64
67
68
78
79
85
86
87
89
90
91
93
94
97
101
102
103
106
110
113
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 1.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
NATURE OF OPERATIONS
Domtar designs, manufactures, markets and distributes a wide variety of fiber-based products including communication papers, specialty and packaging
papers and high quality airlaid and ultrathin laminated cores. The foundation of its business is a network of wood fiber converting assets that produce paper
grade, fluff and specialty pulp. The majority of this pulp production is consumed internally to manufacture paper with the balance sold as market pulp.
Domtar is the largest integrated marketer of uncoated freesheet paper in North America serving a variety of customers, including merchants, retail outlets,
stationers, printers, publishers, converters and end-users.
BASIS OF PRESENTATION
The Company’s consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of
America which requires management to make estimates and assumptions that affect the reported amounts of revenues and expenses during the year, the
reported amounts of assets and liabilities, and the disclosure of contingent assets and liabilities at the date of the consolidated financial statements. On an
ongoing basis, management reviews the estimates and assumptions, including but not limited to those related to environmental matters and asset retirement
obligations, impairment and useful lives of long-lived assets, impairment of intangibles and goodwill, closure and restructuring costs, pension and other
post-retirement benefit plans, income taxes, business combinations and contingencies, based on currently available information. Actual results could differ
from those estimates.
On November 30, 2021, Paper Excellence completed the acquisition of all the outstanding common shares of Domtar Corporation (the “Company”) by
means of a merger of Pearl Merger Sub (a wholly-owned subsidiary) with and into the Company with the Company continuing as the surviving
corporation and as a subsidiary of Paper Excellence (the “Merger”). See Note 4 “Acquisition of businesses” for additional information on the Merger.
For purposes of the Company’s financial statement presentation, Pearl Merger Sub was determined to be the accounting acquirer in the Merger which was
accounted for using the acquisition method of accounting. The application of the acquisition method of accounting resulted in a new basis of accounting
basis of the Company’s assets and liabilities which are measured at fair value as of the date of the Merger.
The Company’s consolidated financial statements for the period following the closing of the Merger are labeled “Successor” and reflect the Company’s
assets and liabilities at their fair values. All periods prior to the closing of the Merger reflect the historical accounting basis of the Company’s assets and
liabilities and are labeled “Predecessor.” The consolidated financial statements and related notes include a black line division between the columns titled
"Predecessor" and "Successor" to signify that the amounts shown for the periods prior to and following the Merger are not comparable.
As a condition to obtain the approval of the Merger from the Canadian Competition Bureau, the Company was required to commit to the divestiture of its
Kamloops, British Columbia production facility within a short period of time following the Merger.
Certain reclassifications have been made to the prior years’ presentation to conform to the current year presentation.
PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of Domtar and its controlled subsidiaries. Intercompany transactions have been eliminated on
consolidation. The equity method of accounting is used for investments in affiliates over which the Company has significant influence but does not have
effective control.
51
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
BUSINESS COMBINATIONS
The Company accounts for business combinations in accordance with ASC 805 “Business Combinations” which requires, among other things, the
acquiring entity in a business combination to recognize the fair value of the assets acquired and liabilities assumed; the recognition of acquisition-related
costs in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss); the recognition of restructuring costs in the Consolidated
Statements of Earnings (Loss) and Comprehensive Income (Loss) for which the acquirer becomes obligated after the acquisition date; and contingent
purchase consideration to be recognized at fair value on the acquisition date with subsequent adjustments recognized in the Consolidated Statements of
Earnings (Loss) and Comprehensive Income (Loss).
Estimates of fair value require a complex series of judgments about future events and uncertainties. The estimates and assumptions used to determine the
preliminary estimated fair value assigned to each class of assets and liabilities, as well as asset lives, have a material impact to the Company's consolidated
financial statements, and are based upon assumptions believed to be reasonable but that are inherently uncertain. The Company generally uses third-party
qualified consultants to assist management in determining the fair value of assets acquired and liabilities assumed. This includes, when necessary,
assistance with the determination of lives and valuation of property and identifiable intangibles and assisting management in assessing off-market contracts
and obligations associated with legal and environmental claims. The purchase price allocation process also entails the Company to refine these estimates
over a measurement period not to exceed one year to reflect new information obtained surrounding facts and circumstances existing at acquisition date.
The excess of the purchase price over the fair value of the identified assets acquired and liabilities assumed is recorded as goodwill.
DISCONTINUED OPERATIONS
The results of operations of the Kamloops, British Columbia production facility (the “Kamloops disposal group”) have been classified as discontinued
operations for all periods presented in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss) as the Kamloops disposal group
met the criteria to be classified as held for sale at the time of the Merger discussed above. The after-tax results of operations of the discontinued operations
are reported as a separate component in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss) for all prior periods presented.
The cash flows related to the Kamloops disposal group have not been segregated and are included in the Consolidated Statements of Cash Flows for all
periods presented. In addition, the related assets and liabilities of the Kamloops disposal group have been classified as held for sale in the Consolidated
Balance Sheets and are measured at their fair values at December 31, 2021.
The results of operations for the Personal Care business unit (the “Personal Care disposal group”) have been classified as discontinued operations for all
periods presented in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss) as the Personal Care disposal group met the
criteria to be classified as held for sale in the fourth quarter of 2020 and the disposal of the business unit represents a strategic shift that has a major effect
on the Company's operations and financial results. The after-tax results of operations of the discontinued operations (including the loss recognized on
classification as held for sale are reported as a separate component in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss)
for current and all prior periods presented. The cash flows related to the divested Personal Care business have not been segregated and are included in
Consolidated Statements of Cash Flows for all periods presented. In addition, the related assets and liabilities of the disposal group have been classified as
held for sale in the Consolidated Balance Sheets.
52
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
TRANSLATION OF FOREIGN CURRENCIES
The Company determines its international subsidiaries’ functional currency by reviewing the currencies in which their respective operating activities occur.
The Company translates assets and liabilities of its non-U.S. dollar functional currency subsidiaries into U.S. dollars using the rate in effect at the balance
sheet date and revenues and expenses are translated at the average exchange rates during the year. Foreign currency translation gains and losses are
included in Shareholders’ equity as a component of Accumulated other comprehensive income (loss) in the accompanying Consolidated Balance Sheets.
Monetary assets and liabilities denominated in a currency that is different from a reporting entity’s functional currency must first be remeasured from the
applicable currency to the legal entity’s functional currency. The effect of this remeasurement process is recognized in the Consolidated Statements of
Earnings (Loss) and Comprehensive Income (Loss) and is partially offset by the Company’s hedging program (refer to Note 21 “Derivatives and hedging
activities and fair value measurement”).
REVENUE RECOGNITION
The Company’s revenue is generated from the sale of finished goods to customers. Revenue is recognized at a single point in time when the performance
obligation is satisfied which occurs when the control over the goods is transferred to customers. For shipping and handling activities performed after
customers obtain control of the goods, the Company elected to account for these activities as fulfillment activities rather than assessing such activities as
separate performance obligations. Accordingly, the sale of goods to customers represents a single performance obligation to which the entire transaction
price is allocated.
The point in time when the control of goods is transferred to customers is largely dependent on delivery terms. Revenue is recorded at the time of shipment
for delivery terms designated free on board (“f.o.b.”) shipping point. For sales transactions designated f.o.b. destination, revenue is recorded when the
product is delivered to the customer’s delivery site.
Revenue is measured as the amount of consideration the Company expects to receive in exchange for goods transferred to customers. Revenue is
recognized net of variable consideration in the form of rebates, discounts and other commercial incentives extended to customers. Variable consideration is
recognized using the most likely amounts which are based on an analysis of historical experience and current period expectations. The Company includes
estimated amounts of variable consideration in revenue to the extent that it is probable that there will not be a significant reversal of recognized revenue
when the uncertainty related to that variable consideration is resolved.
For all the Company’s contracts, customer payments are due in less than one year. Accordingly, the Company does not adjust the amount of revenue
recognized for the effects of a significant financing component.
Sales taxes, and other similar taxes, collected from customers are excluded from revenue.
SHIPPING AND HANDLING COSTS
The Company classifies shipping and handling costs as a component of Cost of sales in the Consolidated Statements of Earnings (Loss) and
Comprehensive Income (Loss).
53
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
CLOSURE AND RESTRUCTURING COSTS
Closure and restructuring costs are recognized as liabilities in the period when they are incurred and are measured at their fair value. For such recognition
to occur, management, with the appropriate level of authority, must have approved and committed to a firm plan and appropriate communication to those
affected must have occurred. These provisions may require an estimation of costs such as severance and termination benefits, pension and related
curtailments, environmental remediation and may also include expenses related to demolition and outplacement. Actions taken may also require an
evaluation of any remaining assets to determine required impairments, if any, and a review of estimated remaining useful lives which may lead to
accelerated depreciation expense.
Estimates of cash flows and fair value relating to closures and restructurings require judgment. Closure and restructuring liabilities are based on
management’s best estimates of future events. Although the Company does not anticipate significant changes, the actual costs may differ from these
estimates due to subsequent developments such as the results of environmental studies, the ability to find a buyer for assets set to be dismantled and
demolished and other business developments. As such, additional costs and further working capital adjustments may be required in future periods.
INCOME TAXES
Domtar uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are determined according
to differences between the carrying amounts and tax bases of the assets and liabilities. The Company records its worldwide tax provision based on the
respective tax rules and regulations for the jurisdictions in which it operates. The change in the net deferred tax asset or liability is included in Income tax
(benefit) expense or in Other comprehensive income in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss). Deferred tax
assets and liabilities are measured using enacted tax rates and laws expected to apply in the years in which the assets and liabilities are expected to be
recovered or settled. Uncertain tax positions are recorded based upon the Company’s evaluation of whether it is “more likely than not” (a probability level
of more than 50%) that, based upon its technical merits, the tax position will be sustained upon examination by the taxing authorities. The Company
establishes a valuation allowance for deferred tax assets when it is more likely than not that they will not be realized. In general, “realization” refers to the
incremental benefit achieved through the reduction in future taxes payable or an increase in future taxes refundable from the deferred tax assets. Deferred
tax assets and liabilities are classified as non-current items on the Consolidated Balance Sheets.
The Company recognizes interest and penalties related to income tax matters as a component of Income tax (benefit) expense in the Consolidated
Statements of Earnings (Loss) and Comprehensive Income (Loss).
If and when incurred, the Company accounts for any taxes associated with Global Intangible Low-Taxed Income (“GILTI”) as a period cost.
CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash and short-term investments with original maturities of less than three months and are presented at cost which
approximates fair value.
RECEIVABLES AND ALLOWANCES FOR CREDIT LOSSES
The Company establishes allowances for credit losses on receivables. The adequacy of these allowances is assessed quarterly through consideration of
factors including, but not limited to, customer credit ratings, bankruptcy filings, published or estimated credit default rates, age of the receivable, expected
loss rates and collateral exposures. The Company assigns internal credit ratings for all customers and determines the creditworthiness of each customer
based upon publicly available information and information obtained directly from its customers. The securitization of receivables is accounted for as
secured borrowings. Accordingly, financing expenses related to the securitization of receivables are recognized in earnings as a component of Interest
expense, net in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss).
54
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INVENTORIES
Inventories are stated at the lower of cost or net realizable value. Cost includes labor, materials and production overhead. The last-in, first-out (“LIFO”)
method is used to account for certain domestic raw materials, in process and finished goods inventories. The balance of domestic raw material inventories,
all materials and supplies inventories and all foreign inventories are recorded at either the first-in, first-out (“FIFO”) or average cost methods.
PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are stated at cost less accumulated depreciation including asset impairments. Costs for repair and maintenance activities are
expensed as incurred under the direct expense method of accounting. Interest costs are capitalized for significant capital projects. For timberlands, the
amortization is calculated using the unit of production method. For all other assets, depreciation is calculated using the straight-line method over the
estimated useful lives of the assets. Buildings and improvements are depreciated over periods of 10 to 40 years and machinery and equipment over periods
of 3 to 20 years. No depreciation is recorded on assets under construction.
IMPAIRMENT OF PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment are reviewed for impairment upon the occurrence of events or changes in circumstances indicating that the carrying value of
the assets may not be recoverable, by comparing the net book value of the asset group to their estimated undiscounted future cash flows expected from their
use and eventual disposition. Impaired assets are recorded at estimated fair value, determined principally by using the present value of estimated future cash
flows expected from their use and eventual disposition.
LEASES
At inception of an arrangement, the Company determines whether the arrangement contains a lease. A lease conveys the right to control the use of
identified property, plant, or equipment (asset) for a period of time in exchange for consideration. Control over the use of the identified asset means that the
Company has both the right to obtain substantially all of the economic benefits from the use of the asset and the right to direct the use of the asset.
For each lease arrangement that has an original lease term of more than 12 months, a right-of-use asset and a lease liability are recorded in the Consolidated
Balance Sheets. The right-of-use asset represents the Company’s right to use an underlying asset for the lease term while the lease liability represents the
obligation to make lease payments arising from the lease. The right-of-use asset and the lease liability are initially recorded at the same amount at the lease
commencement date based on the present value of the remaining lease payments discounted using the Company’s incremental borrowing rate. The
operating lease right-of-use asset also include previously recognized impairments and purchase price adjustments relating to favorable and unfavorable
terms of leases acquired as part of business combinations. Lease terms may include options to extend or terminate the lease when it is reasonably certain
that the Company will exercise that option. Impairment of right-of-use assets are determined and calculated in the same manner as disclosed under
impairment of property, plant and equipment.
The terms of a lease arrangement determine how a lease is classified (operating or finance), the resulting recognition pattern in the Consolidated Statements
of Earnings (Loss) and Comprehensive Income (Loss) and the classification in the Consolidated Balance Sheets.
Finance lease expense is represented by the interest on the lease liability determined using the effective interest method and the amortization of the finance
lease right-of-use asset calculated using the straight-line method over the estimated useful life of the identified asset. Finance lease related balances are
included in the Consolidated Balance Sheets in Property, plant and equipment, net, Long-term debt due within one year and Long-term debt.
Operating lease expense is recorded on a straight-line basis over the lease term by adding interest expense determined using the effective interest method to
the amortization of the right-of-use asset. Operating lease related balances are included in the Consolidated Balance Sheets in Operating lease right-of-use
assets, Operating lease liabilities due within one year and Operating lease liabilities.
55
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
DEFINITE-LIVED INTANGIBLE ASSETS
Definite-lived intangible assets are stated at cost less amortization and are reviewed for impairment whenever events or changes in circumstances indicate
that their carrying amount may not be recoverable. Definite-lived intangible assets include water rights, customer relationships, trade names, technology as
well as non-compete agreements, which are generally being amortized using the straight-line method over their respective estimated useful lives. Based on
guidance provided in ASC 350, the customer relationships are amortized in a manner that reflects the pattern in which the economic benefits of the
intangible asset are consumed. Any potential impairment for definite-lived intangible assets will be calculated in the same manner as disclosed under
impairment of property, plant and equipment.
Amortization is based on the following preliminary useful lives:
Water rights
Customer relationships
Trade Names
DEBT ISSUANCE COSTS
Useful life
40 years
Up to 15 years
Up to 20 years
Debt issuance costs are presented in the Consolidated Balance Sheets as a deduction from the carrying value of long-term debt. Debt issuance costs
associated with revolving credit arrangements are presented in Other assets in the Consolidated Balance Sheets. Debt issuance costs are amortized using the
effective rate method over the term of the related debt and included in Interest expense, net in the Consolidated Statements of Earnings (Loss) and
Comprehensive Income (Loss).
ENVIRONMENTAL COSTS AND ASSET RETIREMENT OBLIGATIONS
Environmental expenditures for effluent treatment, air emission, silvicultural activities and site remediation (together referred to as environmental matters)
are expensed or capitalized depending on their future economic benefit. In the normal course of business, Domtar incurs certain operating costs for
environmental matters that are expensed as incurred. Expenditures for property, plant and equipment that prevent future environmental impacts are
capitalized and amortized on a straight-line basis over 10 to 40 years. Provisions for environmental matters are recorded when remediation efforts are
probable and can be reasonably estimated. Provisions for environmental matters are generally not discounted, due to uncertainty with respect to timing of
expenditures.
Asset retirement obligations are mainly associated with landfill operation and closure, dredging of settling ponds and bark pile management and are
recognized, at fair value, in the period in which Domtar incurs a legal obligation associated with the retirement of an asset. Conditional asset retirement
obligations are recognized, at fair value, when the fair value of the liability can be reasonably estimated on a probability-weighted discounted cash flow
estimate. The associated costs are capitalized as part of the carrying value of the related asset and depreciated over its remaining useful life. The liability is
accreted using the credit adjusted risk-free interest rate used to discount the cash flow.
56
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
STOCK-BASED COMPENSATION AND OTHER STOCK-BASED PAYMENTS
Prior to the Merger date, Domtar recognized the cost (net of estimated forfeitures) of employee services received in exchange for awards of equity
instruments over the requisite service period, based on their grant date fair value for awards accounted for as equity and based on the quoted market value
at the end of each reporting period for awards accounted for as liabilities. The Company awards were accounted for as compensation expense in the
Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss) and presented in Additional paid-in capital on the Consolidated Balance
Sheets for equity type awards and presented in Other liabilities and deferred credits on the Consolidated Balance Sheets for liability type awards.
The Company’s awards may have been subject to market, performance and/or service conditions. Any consideration paid by plan participants on the
exercise of stock options or the purchase of shares was credited to Additional paid-in capital in the Consolidated Balance Sheets. The par value included in
the Additional paid-in capital component of stock-based compensation was transferred to Common stock upon the issuance of shares of common stock.
Stock options subject to service conditions vested pro rata on the first three anniversaries of the grant and had a seven-year term. Service and performance-
based awards vested on the third anniversary of the grant. The performance-based awards had an additional feature where the ultimate number of units that
vested were determined by the Company’s performance results or shareholder return in relation to a predetermined target over the vesting period. Deferred
Share Units vested immediately at the grant date and were remeasured at the end of each reporting period, until settlement, using the quoted market value.
At the Merger date, all the Company’s outstanding stock-based awards, whether vested or unvested, were cancelled and converted into the right to receive
cash payment.
DERIVATIVE INSTRUMENTS
Derivative instruments may be utilized by Domtar as part of the overall strategy to manage exposure to fluctuations in foreign currency, interest rate and
commodity price on certain purchases. As a matter of policy, derivatives are not used for trading or speculative purposes. All derivatives are recorded at
fair value either as assets or liabilities. When derivative instruments have been designated within a hedge relationship and are highly effective in offsetting
the identified risk characteristics of specific financial assets and liabilities or group of financial assets and liabilities, hedge accounting is applied. In a fair
value hedge, changes in fair value of derivatives are recognized in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss). The
change in fair value of the hedged item attributable to the hedged risk is also recorded in the Consolidated Statements of Earnings (Loss) and
Comprehensive Income (Loss) by way of a corresponding adjustment of the carrying amount of the hedged item recognized in the Consolidated Balance
Sheets. In a cash flow hedge, changes in fair value of derivative instruments are recorded in Other comprehensive income. These amounts are reclassified
in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss) in the periods in which results are affected by the cash flows of the
hedged item within the same line item.
57
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
PENSION PLANS
Domtar’s plans include funded and unfunded defined benefit and defined contribution pension plans. Domtar recognizes the overfunded or underfunded
status of defined benefit and underfunded defined contribution pension plans as an asset or liability in the Consolidated Balance Sheets. The net periodic
benefit cost includes the following:
-
-
-
-
-
-
The cost of pension benefits provided in exchange for employees’ services rendered during the period,
The interest cost of pension obligations,
The expected long-term return on pension fund assets based on a market value of pension fund assets,
Gains or losses on settlements and curtailments,
The straight-line amortization of past service costs and plan amendments over the average remaining service period of approximately ten
years of the active employee group covered by the plans, and
The amortization of cumulative net actuarial gains and losses in excess of 10% of the greater of the projected benefit obligation and the
market value of assets over the average remaining service period of approximately ten years of the active employee group covered by the
plans.
The defined benefit plan obligations are determined in accordance with the projected unit credit actuarial cost method.
OTHER POST-RETIREMENT BENEFIT PLANS
The Company recognizes the unfunded status of other post-retirement benefit plans as a liability in the Consolidated Balance Sheets. These benefits, which
are funded by Domtar as they become due, include life insurance programs, medical and dental benefits and short-term and long-term disability programs.
The Company amortizes the cumulative net actuarial gains and losses in excess of 10% of the greater of the projected benefit obligation and the market
value of assets over the average remaining service period of approximately 11 years of the active employee group covered by the plans.
GUARANTEES
A guarantee is a contract or an indemnification agreement that contingently requires Domtar to make payments to the other party of the contract or
agreement, based on changes in an underlying item that is related to an asset, a liability or an equity security of the other party or on a third party’s failure
to perform under an obligating agreement. It could also be an indirect guarantee of the indebtedness of another party, even though the payment to the other
party may not be based on changes in an underlying item that is related to an asset, a liability or an equity security of the other party. Guarantees, when
applicable, are accounted for at fair value.
58
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 2.
RECENT ACCOUNTING PRONOUNCEMENTS
FUTURE ACCOUNTING CHANGES
TRANSITION AWAY FROM INTERBANK OFFERED RATES
On March 12, 2020, the FASB issued ASU 2020-04, “Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on
Financial Reporting”. The ASU provides optional expedients and exceptions for applying generally accepted accounting principles to contract
modifications and hedging relationships, subject to meeting certain criteria, that reference LIBOR or another reference rate expected to be discontinued.
The amendments in the ASU are elective and apply to entities that have contracts, hedging relationships, and other transactions that reference LIBOR or
another reference rate expected to be discontinued due to reference rate reform. An entity may elect to apply the amendments prospectively through
December 31, 2022.
As of December 31, 2021, the Company has not yet elected any optional expedients provided in the standard. The Company will apply the accounting
relief, if necessary, as relevant contract and hedge accounting relationship modifications are made during the reference rate reform transition period. The
Company does not expect the adoption of this guidance to have a material impact on the consolidated financial statements.
59
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 3.
DISCONTINUED OPERATIONS
Mandated sale of Kamloops, British Columbia mill
On November 30, 2021, Paper Excellence completed the acquisition of all the outstanding shares of Domtar Corporation. The acquisition was subject to the
review by the Canadian Competition Bureau, which outlined certain stipulations in a consent agreement before providing their final approval.
The consent agreement filed by the Canadian Commissioner of Competition (“Commissioner”) with the Competition Tribunal fulfilled the final condition
to the closing of the business combination. According to the consent agreement, following the closing of the business combination, Domtar’s pulp mill in
Kamloops, British Columbia must be sold in order to resolve the Commissioner’s concerns about the business combination’s implications on the purchase
of wood fiber from the Thompson/Okanagan region in British Columbia.
The mill will be sold to an independent purchaser to be approved by the Commissioner.
The results of operations of Domtar’s pulp mill in Kamloops, British Columbia were reclassified to discontinued operations. These results have been
summarized in Earnings from discontinued operations, net of taxes on the Company’s Consolidated Statements of Earnings (Loss) and Comprehensive
Income (Loss) for each period presented. The Consolidated Statements of Cash Flows were not reclassified to reflect discontinued operations.
Sale of Personal Care business
On March 1, 2021, Domtar completed the sale of the Company’s Personal Care business to American Industrial Partners (“AIP”) for a purchase price of
$920 million in cash, including elements of working capital of $130 million. Domtar received a net amount of $897 million, which represents the selling
price minus the settlements of the net indebtedness and other elements of working capital adjustments. In connection with the sale, the Company entered
into Transition Services Agreements with AIP pursuant to which the Company agreed to provide various back-office and information technology support
until the business is fully separated from Domtar.
The results of operations of the Company’s Personal Care business were reclassified to discontinued operations. These results have been summarized in
Earnings from discontinued operations, net of taxes on the Company’s Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss) for
each period presented. The Consolidated Statements of Cash Flows were not reclassified to reflect discontinued operations. Personal Care was previously
disclosed as a separate reportable business segment.
60
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 3. DISCONTINUED OPERATIONS (CONTINUED)
Major components of earnings from discontinued operations:
Sales
Operating expenses
Cost of sales, excluding depreciation and amortization
Depreciation and amortization
Selling, general and administrative
Impairment of long-lived assets
Closure and restructuring costs
Other operating loss, net
Operating income
Net loss on disposition of discontinued operations
Earnings from discontinued operations
before income taxes
Income tax expense (benefit)
Net earnings from discontinued operations
Successor
Period from
December 1,
through
December 31,
2021
$
18
Period from
January 1,
through
November 30,
2021
$
446
Predecessor
Year ended
December 31,
2020
$
1,232
Year ended
December 31,
2019
$
1,170
16
—
—
—
—
—
16
2
—
2
1
1
323
23
26
—
1
1
374
72
33
39
13
26
932
75
142
1
—
2
1,152
80
45
35
11
24
892
77
145
26
20
1
1,161
9
—
9
(9)
18
61
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 3. DISCONTINUED OPERATIONS (CONTINUED)
Major classes of assets and liabilities classified as held for sale in the accompanying Balance Sheets were as follows:
Assets
Receivables
Inventories
Prepaid expenses
Income and other taxes receivable
Property, plant and equipment, net
Operating lease right-of-use assets
Intangible assets, net (2)
Other assets
Total assets
Loss on classification as held for sale
Total assets of the disposal group classified as held for sale on the
Consolidated Balance Sheets (1)
Liabilities
Trade and other payables
Income and other taxes payable
Operating lease liabilities due within one year
Long-term debt due within one year
Long-term debt
Operating lease liabilities
Deferred income taxes and other
Other liabilities and deferred credits
Total liabilities of the disposal group classified as held for sale on the
Consolidated Balance Sheets (1)
Successor
Predecessor
At
December 31,
2021
$
December 31,
2020
$
50
82
—
—
155
—
—
—
287
—
287
26
—
—
1
4
—
27
5
63
135
206
3
3
454
15
554
2
1,372
(43)
1,329
155
12
8
1
6
8
143
12
345
(1) Total assets and liabilities of discontinued operations are classified in current assets and liabilities, respectively, in the Company’s Consolidated
(2)
Balance Sheet at December 31, 2021.
Intangible assets, net at December 31, 2020 are comprised of $290 million ($248 million of trade names and $42 million of catalog rights) of
indefinite-lived assets and $264 million of definite-lived assets.
62
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 3. DISCONTINUED OPERATIONS (CONTINUED)
Cash Flows from Discontinued Operations:
Cash flows from operating activities
Cash flows used for investing activities
Successor
Period from
December 1,
through
December 31,
2021
$
3
(1)
Predecessor
Period from
January 1,
through
November 30,
2021
$
57
(14)
Year ended
December 31,
2020
$
130
(40)
Year ended
December 31,
2019
$
164
(57)
63
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 4.
ACQUISITION OF BUSINESSES
Acquisition of Domtar Corporation by Paper Excellence
On November 30, 2021, Paper Excellence completed the acquisition of all the outstanding common shares of Domtar Corporation (the “Company”) by
means of a merger of Pearl Merger Sub (a wholly-owned subsidiary) with and into the Company with the Company continuing as the surviving corporation
and as a subsidiary of Paper Excellence (the “Merger”). On the terms and subject to the conditions set forth in the Merger Agreement, each share of
outstanding common stock of the Company was converted into the right to receive $55.50 in cash. The acquisition-date fair value of the consideration
transferred totaled $2.796 billion, less cash acquired of $332 million.
Pearl Merger Sub was determined to be the accounting acquirer in the Merger which was accounted for using the acquisition method of accounting. The
application of the acquisition method of accounting resulted in a new basis of accounting basis of the Company’s assets and liabilities which are measured
at fair value at the acquisition date.
The following table summarizes the estimated fair values of the assets acquired and liabilities assumed at the acquisition date. The Company is in the
process of obtaining third-party valuations of certain tangible and intangible assets; thus, the provisional measurements of tangible and intangible assets,
off-market contracts and deferred income tax assets are subject to change.
Fair value of net assets acquired at the date of acquisition
Receivables
Inventories
Prepaid expenses
Income and other taxes receivable
Property, plant and equipment
Intangible assets
Customer relationships
Trade names
Water rights
Operating lease right-of-use assets
Other assets
Assets held for sale
Total assets
Less: Assumed Liabilities
Trade and other payables
Income and other taxes payable
Operating lease liabilities (including short-term portion)
Long-term debt (including short-term portion)
Deferred income tax liabilities
Other liabilities and deferred credits
Liabilities held for sale
Total liabilities
Fair value of net assets acquired at the date of acquisition
64
$
170
30
7
501
646
49
54
2,498
207
51
252
290
4,548
667
16
57
529
529
221
65
2,084
2,464
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 4. ACQUISITION OF BUSINESSES (CONTINUED)
The preliminary estimated fair value assigned to identifiable intangible assets acquired are determined primarily by using an income approach using a
discounted cash flow methodology, which is based on assumptions and estimates made by management. The preliminary estimated fair value of the
customer relationship intangible assets was estimated using the multi-period excess earnings method. Management applied significant judgement related to
this fair value method, which included the selection of an expected EBITDA margin assumption for the forecast period, contributory asset charges,
customer attrition rate and market-participant discount rate assumptions. These significant assumptions are based on company specific information and
projections, which are not observable in the market (except for the discount rate assumption) and, therefore, are considered Level 2 and Level 3
measurements. These significant assumptions are forward-looking and could be affected by future changes in economic and market conditions.
The preliminary estimated fair value of property, plant and equipment was primarily determined based on management’s preliminary estimate of
depreciated replacement cost as further adjusted based on estimated cash flow forecasts. The significant assumptions underlying the fair value are based on
company specific information and projections, which are not observable in the market and, therefore, are considered Level 2 and Level 3 measurements.
These significant assumptions are forward-looking and could be affected by future changes in economic and market conditions.
The preliminary estimated fair value of finished goods was calculated as the estimated selling price, adjusted for costs of the selling effort and a reasonable
profit allowance relating to the selling effort. The preliminary estimated fair value of work in process inventory was primarily calculated as the estimated
selling price, adjusted for estimated costs to complete the manufacturing, estimated costs of the selling effort, as well as a reasonable profit margin on the
remaining manufacturing and selling effort. The preliminary estimated fair value of raw materials and operating and maintenance supplies was determined
to approximate the historical carrying value. These significant assumptions are based on company specific information and projections, which are not
observable in the market and, therefore, are considered Level 2 and Level 3 measurements. These significant assumptions are forward-looking and could be
affected by future changes in economic and market conditions.
The Company recognized $132 million of acquisition related costs that were expensed in the predecessor period. These costs are included in the
Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss) in the line item entitled Transaction costs.
The Predecessor period includes the historical financial information of Pearl Merger Sub prior to the business combination, which is limited to immaterial
amounts of interest and merger-related transactions costs. The businesses, and thus the financial results of the Successor and Predecessor entities, are
virtually the same, excluding the impact on certain financial statement line items that were impacted by the Merger mainly:
•
Depreciation and amortization on fair value increments relating to Property, plant and equipment and fair values ascribed to identified intangible
assets;
Interest expense and amortization of debt issuance costs relating to additional long-term debt raised by Pearl Merger Sub to effect the Merger;
•
• Merger-related transaction costs; and,
•
Current and deferred income tax impacts of the above.
65
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 4. ACQUISITION OF BUSINESSES (CONTINUED)
Purchase of Appvion Point of Sale business
On April 27, 2020, Domtar Corporation completed the acquisition of the Point of Sale paper business from Appvion Operation Inc. The business includes
the coater and related equipment located at Appvion’s West Carrollton, Ohio, facility as well as a license for all corresponding intellectual property and
assumed liabilities related to post-retirement benefits. The results of this business have been included in the consolidated financial statements as of April
27, 2020. The purchase price was $20 million in cash plus the book value of raw materials and finished goods inventory, subject to post-closing
adjustments. The acquisition was accounted for as a business combination under the acquisition method of accounting. The total purchase price was
allocated to tangible and intangible assets acquired and liabilities assumed based on the Company’s estimates of their fair value, and was finalized during
2020.
The table below illustrates the purchase price allocation:
Fair value of net assets acquired at the date of acquisition
Inventories
Property, plant and equipment
Operating lease right-of-use assets
Total assets
Less: Assumed Liabilities
Fair value of net assets acquired at the date of acquisition
66
$
11
23
2
36
6
30
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 5.
STOCK-BASED COMPENSATION
Acquisition of Domtar Corporation by Paper Excellence
Pursuant to the terms of the Omnibus Plan, as a result of the acquisition by Paper Excellence, on the Merger date, the Company recognized an accelerated
vesting on all the outstanding stock-based awards under the Omnibus Plan. These awards were then cancelled and converted into the right to receive cash
payment, which was made in December 2021. In turn, the Omnibus Plan was terminated and is expected to be replaced in 2022 by a new long-term
incentive program.
For the year ended December 31, 2021, stock-based compensation expense recognized in the predecessor Company’s results from continuing and
discontinued operations was $46 million (2020 – $7 million; 2019 – $22 million), of which $34 million, related to the accelerated vesting of stock-based
awards, was recorded under Transaction costs in the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss).
67
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6.
PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS
DEFINED CONTRIBUTION PLANS
The Company has several defined contribution plans. The pension expense under these plans is equal to the Company’s contribution. For the 1 month
ended December 31, 2021 and the 11 months ended November 30, 2021, the related pension expense was $3 million and $30 million, respectively (2020 –
$37 million; 2019 – $37 million).
DEFINED BENEFIT PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS
The Company sponsors both contributory and non-contributory U.S. and non-U.S. defined benefit pension plans. Non-unionized employees in Canada
joining the Company after January 1, 1998 participate in a defined contribution pension plan. Salaried employees in the U.S. joining the Company after
January 1, 2008 participate in a defined contribution pension plan. Unionized and non-union hourly employees in the U.S. that are not grandfathered under
the existing defined benefit pension plans, participate in a defined contribution pension plan for future service. The Company also sponsors a number of
other post-retirement benefit plans for eligible U.S. and non-U.S. employees; the plans are unfunded and include life insurance programs and medical and
dental benefits. The Company also provides supplemental unfunded defined benefit pension plans and supplemental unfunded defined contribution pension
plans to certain senior management employees.
Related pension and other post-retirement plan expenses and the corresponding obligations are actuarially determined using management’s most probable
assumptions.
The Company’s pension plan funding policy is to contribute annually the amount required to provide for benefits earned in the year and to fund solvency
deficiencies, funding shortfalls and past service obligations over periods not exceeding those permitted by the applicable regulatory authorities. Past service
obligations primarily arise from improvements to plan benefits. The other post-retirement benefit plans are not funded, and contributions are made annually
to cover benefit payments.
The Company expects to contribute a minimum total amount of $8 million in 2022 compared to $17 million in 2021 (2020 – $15 million; 2019 – $17
million) to the pension plans. The Company expects to contribute a minimum total amount of $5 million in 2022 compared to $4 million in 2021 (2020 –
$4 million; 2019 – $4 million) to the other post-retirement benefit plans.
68
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6. PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS (CONTINUED)
CHANGE IN PROJECTED BENEFIT OBLIGATION
The following table represents the change in the projected benefit obligation as of December 31, 2021 and December 31, 2020, the measurement date for
each year:
Projected benefit obligation at beginning of year
Service cost for the year
Interest expense
Plan participants' contributions
Actuarial (gain) loss
Plan amendments
Benefits paid
Direct benefit payments
Acquisition of business
Curtailment (1)
Settlement (2)
Effect of foreign currency exchange rate change
Projected benefit obligation at end of year
Successor
December 31, 2021
Predecessor
December 31, 2020
Pension
plans
$
1,566
28
34
6
(104)
6
(65)
(9)
—
—
(35)
6
1,433
Other post-
retirement
benefit plans
$
67
1
2
—
(6)
—
(1)
(3)
—
—
—
—
60
Pension
plans
$
1,425
29
39
6
127
2
(67)
(3)
—
(1)
(15)
24
1,566
Other post-
retirement
benefit plans
$
63
1
2
—
2
—
—
(4)
1
—
—
2
67
During 2021, net actuarial gains decreased the projected benefit obligation due to the increase in discount rates. During 2020, net actuarial losses increased
the projected benefit obligation due to the decrease in discount rates.
The accumulated benefit obligation of the pension plans at December 31, 2021 and 2020 was $1,386 million and $1,516 million, respectively.
69
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6. PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS (CONTINUED)
CHANGE IN FAIR VALUE OF ASSETS
The following table represents the change in the fair value of assets, as of December 31, 2021 and December 31, 2020, reflecting the actual return on plan
assets, the contributions and the benefits paid for each year:
Fair value of assets at beginning of year
Actual return on plan assets
Employer contributions
Plan participants' contributions
Benefits paid
Settlement (2)
Effect of foreign currency exchange rate change
Fair value of assets at end of year
Successor
December 31,
2021
Pension plans
$
1,594
106
17
6
(74)
(35)
8
1,622
Predecessor
December 31,
2020
Pension plans
$
1,465
166
15
6
(70)
(15)
27
1,594
(1) Curtailment accounting was triggered following the restructuring activities that occurred in 2020. The impact was estimated as of July 31,
2020, based on the information known at that time and was remeasured on December 31, 2020.
(2) Settlement accounting was triggered as of December 31, 2020, following the restructuring activities that occurred in 2020, to reflect lump
sums paid in 2020 in excess of the sum of service cost and interest cost. Settlement accounting was triggered throughout 2021 as lump sums
paid have exceeded the sum of service cost and interest cost.
INVESTMENT POLICIES AND STRATEGIES OF THE PLAN ASSETS
The assets of the pension plans are held by a number of independent trustees and are accounted for separately in the Company’s pension funds. The
investment strategy for the assets in the pension plans is to maintain a diversified portfolio of assets, invested in a prudent manner to maintain the security
of funds while maximizing returns within the guidelines provided in the investment policy. Diversification of the pension plans’ holdings is maintained in
order to reduce the pension plans’ annual return variability, reduce market and credit exposure to any single asset and to any single component of the
capital markets, reduce exposure to unexpected inflation, enhance the long-term risk-adjusted return potential of the pension plans and reduce funding risk.
Over the long-term, the performance of the pension plans is primarily determined by the long-term asset mix decisions. To manage the long-term risk of not
having sufficient funds to match the obligations of the pension plans, the Company conducts asset/liability studies. These studies lead to the
recommendation and adoption of a long-term asset mix target that sets the expected rate of return and reduces the risk of adverse consequences to the plans
from increases in liabilities and decreases in assets. In identifying the asset mix target that would best meet the investment objectives, consideration is
given to various factors, including (a) each plan’s characteristics, (b) the duration of each plan’s liabilities, (c) the solvency and going concern financial
position of each plan and their sensitivity to changes in interest rates and inflation, and (d) the long-term return and risk expectations for key asset classes.
The investments of each plan can be done directly through cash investments in equities or bonds or indirectly through derivatives or pooled funds. The use
of derivatives must be in accordance with an approved mandate and cannot be used for speculative purposes.
The Company’s pension funds are not permitted to directly own any of the Company’s shares or debt instruments.
70
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6. PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS (CONTINUED)
The following table shows the allocation of the plan assets, based on the fair value of the assets held and the target allocation for 2021:
Fixed income
Cash and cash equivalents
Bonds
Insurance contracts
Equity
Canadian Equity
U.S. Equity
International Equity
Alternate Investments
Real Estate
Multi Asset Credit
Infrastructure
Total (1)
Successor
Percentage of
plan assets at
December 31,
2021
Predecessor
Percentage of
plan assets at
December 31,
2020
8%
40%
10%
6%
12%
19%
5%
0%
0%
100%
2%
42%
11%
6%
15%
24%
0%
0%
0%
100%
Target allocation
0% – 10%
26% – 56%
10%
0% – 10%
6% – 15%
11% – 24%
0% – 13%
0% – 10%
0% – 9%
(1)
Approximately 73% of the pension plans' assets relate to Canadian plans, 27% relate to U.S. plans.
RECONCILIATION OF FUNDED STATUS TO AMOUNTS RECOGNIZED IN THE CONSOLIDATED BALANCE SHEETS
The following table presents the difference between the fair value of assets and the actuarially determined projected benefit obligation. This difference is
also referred to as either the deficit or surplus, as the case may be, or the funded status of the plans. The table further reconciles the amount of the surplus or
deficit (funded status) to the net amount recognized in the Consolidated Balance Sheets.
Projected benefit obligation at end of year
Fair value of assets at end of year
Funded status
Successor
December 31, 2021
Predecessor
December 31, 2020
Pension
plans
$
(1,433)
1,622
189
Other post-
retirement
benefit plans
$
(60)
—
(60)
Pension
plans
$
(1,566)
1,594
28
Other post-
retirement
benefit plans
$
(67)
—
(67)
71
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6. PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS (CONTINUED)
Trade and other payables
Other liabilities and deferred credits
Other assets
Net amount recognized in the Consolidated
Balance Sheets
Successor
December 31, 2021
Predecessor
December 31, 2020
Pension
plans
$
—
(59)
248
Other post-
retirement
benefit plans
$
(5)
(55)
—
Pension
plans
$
—
(124)
152
Other post-
retirement
benefit plans
$
(5)
(62)
—
189
(60)
28
(67)
The following table presents the pre-tax amounts included in Other comprehensive income (loss):
Predecessor
Successor
Period from
December 1,
through
December 31,
2021
Other post-
retirement
benefit plans
$
—
Period from
January 1,
through
November 30,
2021
Other post-
retirement
benefit plans
$
1
Pension
plans
$
(6)
Pension
plans
$
—
Year ended
December 31,
2020
Other post-
retirement
benefit plans
$
Pension
plans
$
(2)
Year ended
December 31,
2019
Other post-
retirement
benefit plans
$
—
Pension
plans
$
— —
—
22
—
1
(1) 121
(1)
7
2
(26)
(1)
(1)
5
3
—
—
7
(1)
12
(1)
40
(1)
1
(1)
22
(1) 123
6
(14)
(3)
48
(1)
Prior service (cost) credit
Amortization of prior year service
cost (credit)
Net gain (loss)
Amortization of net actuarial loss
(gain) (1)
Net amount recognized in other
comprehensive income
(loss) (pre-tax)
(1)
In 2021, the non-cash settlement was nil (2020 – $2 million; 2019 – $30 million).
72
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6. PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS (CONTINUED)
At December 31, 2021, the projected benefit obligation and the fair value of plan assets with a projected benefit obligation in excess of fair value of plan
assets were $318 million and $259 million, respectively (2020 – $917 million and $793 million, respectively).
Components of net periodic benefit cost for pension plans
Service cost for the year
Interest expense
Expected return on plan assets
Amortization of net actuarial loss
Curtailment loss
Settlement loss
Amortization of prior year service cost
Net periodic benefit cost
Components of net periodic benefit cost for other post-retirement
benefit plans
Service cost for the year
Interest expense
Amortization of net actuarial gain
Amortization of prior year service credit
Net periodic benefit cost
WEIGHTED-AVERAGE ASSUMPTIONS
Successor
Period from
December 1,
through
December 31,
2021
$
2
3
(5)
—
—
—
—
—
Successor
Period from
December 1,
through
December 31,
2021
$
—
—
—
—
—
Period from
January 1,
through
November 30,
2021
$
25
31
(61)
7
—
—
1
3
Period from
January 1,
through
November 30,
2021
$
1
2
(1)
(1)
1
Predecessor
Year ended
December 31,
2020
$
28
39
(68)
10
2
2
2
15
Year ended
December 31,
2019
$
28
57
(79)
10
—
30
5
51
Predecessor
Year ended
December 31,
2020
$
1
2
(1)
(1)
1
Year ended
December 31,
2019
$
1
2
(1)
(1)
1
The Company used the following key assumptions to measure the projected benefit obligation and the net periodic benefit cost. These assumptions are
long-term, which is consistent with the nature of employee future benefits.
Pension plans
Projected benefit obligation
Discount rate
Rate of compensation increase
Net periodic benefit cost
Discount rate
Rate of compensation increase
Expected long-term rate of return on plan assets
Successor
December 31,
2021
November 30,
2021
Predecessor
December 31,
2020
December 31,
2019
3.0%
2.7%
3.0%
2.8%
4.3%
N/A
N/A
2.5%
2.7%
4.3%
2.5%
2.7%
3.0%
2.8%
4.6%
3.1%
2.7%
3.8%
2.6%
5.2%
A weighted-average interest-crediting rate of 3.3% was assumed for 2021, for the Company’s cash balance pension plan.
The Company used a full yield curve approach to estimate the current service and interest cost components of net periodic benefit cost for Canadian
pension plans and U.S. funded pension plans. The estimate of these components is made by applying the specific spot rates along the yield curve used in
the determination of the benefit obligation to the relevant projected cash flows.
73
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6. PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS (CONTINUED)
For the unfunded pension plan and other post-retirement benefits, given materiality, the current service and interest cost components were estimated using a
single weighted-average discount rate derived from the yield curve for each unfunded pension plan or based on each post-retirement plans’ projected cash
flows. The discount rate of 2.7% (Successor) and 2.5% (Predecessor) for U.S. unfunded plans is obtained by incorporating the plans’ expected cash flows
in the Mercer Yield Curve.
For Canadian plans, short-term yields to maturity are derived from actual AA rated corporate bond yield data. For longer terms, extrapolated data is used.
The extrapolated data are created by adding a term-based spread over long provincial bond yields. For U.S. funded plans, the rates are taken from the
Mercer Yield Curve which is based on bonds rated AA by Moody’s or Standard & Poor’s, excluding callable bonds, bonds of less than a minimum issue
size, and certain other bonds. The universe of bonds also includes private placement (traded in reliance on Rule 144A and which are at least two years from
issuance), make whole, and foreign corporation (denominated in U.S. dollars) bonds.
Effective January 1, 2022, the Company will use 4.8% (2021 – 4.4%; 2020 – 4.8%) as the expected return on plan assets, which reflects the current view of
long-term investment returns. The overall expected long-term rate of return on plan assets is based on management's best estimate of the long-term returns
of the major asset classes (cash and cash equivalents, equities, bonds and various alternative investment asset classes) weighted by the target allocation of
assets at the measurement date, net of expenses. This rate includes an equity risk premium over government bond returns for equity investments and a
value-added premium for the contribution to returns from active management. The sources used to determine management's best estimate of long-term
returns are numerous and include country specific bond yields, which may be derived from the market using local bond indices or by analysis of the local
bond market, and country-specific inflation and investment market expectations derived from market data and analysts' or governments' expectations, as
applicable.
Other post-retirement benefit plans
Projected benefit obligation
Discount rate
Rate of compensation increase
Net periodic benefit cost
Discount rate
Rate of compensation increase
Successor
December 31,
2021
November 30,
2021
Predecessor
December 31,
2020
December 31,
2019
3.1%
2.9%
3.2%
2.8%
N/A
N/A
2.3%
2.6%
2.5%
2.8%
3.0%
2.7%
3.1%
2.8%
3.7%
2.7%
For measurement purposes, a 3.9% weighted average annual rate of increase in the per capita cost of covered health care benefits was assumed for 2021.
FAIR VALUE MEASUREMENT
Fair Value Measurements and Disclosures Topic of FASB ASC 820 establishes a fair value hierarchy, which prioritizes the inputs to valuation techniques
used to measure fair value into three levels. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input
that is available and significant to the fair value measurement.
Level 1 Quoted prices in active markets for identical assets or liabilities.
Level 2 Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets
or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the
full term of the assets or liabilities.
Level 3
Inputs that are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in
pricing the assets or liabilities.
74
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6. PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS (CONTINUED)
The following table presents the fair value of the plan assets at December 31, 2021, by asset category:
Asset Category
Cash and short-term investments
Canadian provincial government bonds
Canadian corporate debt securities
U.S. corporate debt securities
International corporate debt securities
Bond fund (1 & 2)
Canadian equities (3)
U.S. equities (4)
International equities (5)
U.S. stock index funds (2 & 6)
U.S. private real estate funds (7)
Insurance contracts (8)
Derivative contracts (9)
Total
Successor
Fair Value Measurements at
December 31, 2021
Quoted Prices
in Active
Markets for
Identical Assets
(Level 1)
$
19
377
52
28
8
—
90
94
211
—
—
—
879
Total
$
145
380
70
28
8
157
90
94
211
196
77
165
1
1,622
Significant
Observable
Inputs
(Level 2)
$
126
3
18
—
—
157
—
—
—
196
—
—
1
501
Significant
Unobservable
Inputs
(Level 3)
$
—
—
—
—
—
—
—
—
—
—
77
165
—
242
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
This category represents a U.S. actively managed bond fund that is benchmarked to the Barclays Capital Long-term Government/Credit index.
The fair value of these plan assets is classified as Level 2 (inputs that are observable, directly or indirectly) as they are measured based on quoted
prices in active markets and can be redeemed at the measurement date or in the near term.
This category represents an active segregated large capitalization Canadian equity portfolio with the ability to purchase small and medium
capitalized companies and the Canadian equity portion of an active segregated global equity portfolio.
This category represents U.S. equities held within an active segregated global equity portfolio and an active international equity portfolio.
This category represents an active segregated non-North American multi-capitalization equity portfolio and the non-North American portion of an
active segregated global equity portfolio.
This category represents two equity index funds, not actively managed, that track the Russell 3000 index.
This category represents two U.S. actively managed private real estate funds (Core and Core Plus) that are benchmarked to the NCREIF ODCE.
This category represents a group annuity contract purchased through an insurance company that is held in the pension plan’s name as an asset within
the pension plan. The insurance contract covers pension entitlements associated with specific groups of retired members of the pension plan.
The fair value of the derivative contracts is classified as Level 2 (inputs that are observable, directly or indirectly) as they are measured using long-
term bond indices.
75
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6. PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS (CONTINUED)
The following table presents the fair value of the plan assets at December 31, 2020, by asset category:
Asset Category
Cash and short-term investments
Canadian provincial government bonds
Canadian corporate debt securities
U.S. corporate debt securities
International corporate debt securities
Bond fund (1 & 2)
Canadian equities (3)
U.S. equities (4)
International equities (5)
U.S. stock index funds (2 & 6)
Insurance contracts (7)
Derivative contracts (8)
Total
Predecessor
Fair Value Measurements at
December 31, 2020
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
$
16
388
46
22
10
—
97
99
268
—
—
—
946
Total
$
60
391
63
23
10
173
97
99
268
233
176
1
1,594
Significant
Observable
Inputs
(Level 2)
$
44
3
17
1
—
173
—
—
—
233
—
1
472
Significant
Unobservable
Inputs
(Level 3)
$
—
—
—
—
—
—
—
—
—
—
176
—
176
1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
This category represents a U.S. actively managed bond fund that is benchmarked to the Barclays Capital Long-term Government/Credit index.
The fair value of these plan assets is classified as Level 2 (inputs that are observable, directly or indirectly) as they are measured based on quoted
prices in active markets and can be redeemed at the measurement date or in the near term.
This category represents an active segregated large capitalization Canadian equity portfolio with the ability to purchase small and medium
capitalized companies and the Canadian equity portion of an active segregated global equity portfolio.
This category represents U.S. equities held within an active segregated global equity portfolio and an active international equity portfolio.
This category represents an active segregated non-North American multi-capitalization equity portfolio and the non-North American portion of an
active segregated global equity portfolio.
This category represents two equity index funds, not actively managed, that track the Russell 3000 index.
This category represents a group annuity contract purchased through an insurance company that is held in the pension plan’s name as an asset within
the pension plan. The insurance contract covers pension entitlements associated with specific groups of retired members of the pension plan.
The fair value of the derivative contracts is classified as Level 2 (inputs that are observable, directly or indirectly) as they are measured using long-
term bond indices.
76
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 6. PENSION PLANS AND OTHER POST-RETIREMENT BENEFIT PLANS (CONTINUED)
The following table presents changes during the period for Level 3 fair value measurements of plan assets:
Fair Value Measurements Using Significant
Unobservable Inputs (Level 3)
Balance at December 31, 2019
Purchases
Return on plan assets
Effect of foreign currency exchange rate change
Balance at December 31, 2020
Purchases
Settlements
Return on plan assets
Effect of foreign currency exchange rate change
Balance at December 31, 2021
ESTIMATED FUTURE BENEFIT PAYMENTS FROM THE PLANS
Estimated future benefit payments from the plans for the next 10 years at December 31, 2021 are as follows:
.
Pension plans
2022
2023
2024
2025
2026
2027 – 2031
$
85
84
86
87
87
418
77
$
1
163
3
9
176
70
(14)
9
1
242
Other post-
retirement
benefit plans
$
5
5
4
4
4
20
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 7.
INTEREST EXPENSE, NET
The following table presents the components of interest expense, net:
Interest on long-term debt (1)
Make-whole premium on repayment of long-term debt
Interest on receivables securitization
Interest on withdrawal liabilities for multiemployer plans
Amortization of debt issuance costs and other
Successor
Period from
December 1,
through
December 31,
2021
$
9
—
—
—
1
10
Predecessor
Period from
January 1,
through
November 30,
Year ended
December 31,
2021
$
36
11
1
2
4
54
2020
$
52
—
1
3
2
58
Year ended
December 31,
2019
$
45
—
2
3
2
52
(1)
The Company capitalized $1 million and $8 million of interest expense for the 1 month ended December 31, 2021 and the 11 months ended
November 30, 2021, respectively (2020 – $3 million; 2019 – $3 million).
78
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 8.
INCOME TAXES
The Company’s (loss) earnings before income taxes by taxing jurisdiction were:
U.S. (loss) earnings
Foreign (loss) earnings
(Loss) earnings before income taxes
Provisions for income taxes include the following:
U.S. Federal and State:
Current
Deferred
Foreign:
Current
Deferred
Income tax (benefit) expense
Successor
Period from
December 1,
through
December 31,
2021
$
(4)
(3)
(7)
Period from
January 1,
through
November 30,
Predecessor
Year ended
December 31,
2021
$
(7)
(36)
(43)
2020
$
(199)
(29)
(228)
Year ended
December 31,
2019
$
80
(1)
79
Successor
Period from
December 1,
through
December 31,
2021
$
5
(6)
4
(5)
(2)
Predecessor
Period from
January 1,
through
November 30,
2021
$
29
(13)
(23)
13
6
Year ended
December 31,
2020
$
Year ended
December 31,
2019
$
(21)
(45)
(11)
(3)
(80)
19
(6)
1
(3)
11
79
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 8. INCOME TAXES (CONTINUED)
The Company’s provision for income taxes differs from the amounts computed by applying the statutory income tax rate of 21% to (loss) earnings before
income taxes due to the following:
U.S. federal statutory income tax
Reconciling Items:
State and local income taxes, net of federal
income tax benefit
Foreign income tax rate differential
Tax credits and special deductions
U.S. tax rate benefit from loss carryback
Tax rate changes
Deemed mandatory repatriation tax
Uncertain tax positions
Deferred taxes on Personal Care Group Investment
Deferred taxes on foreign earnings
Intercompany income with assets held for sale
Net book value adjustment of assets held for sale
Valuation allowance on deferred tax assets
Nondeductible expenses
Global intangible low-taxed income (GILTI)
Foreign-derived intangible income (FDII)
Other
Income tax (benefit) expense
Successor
Period from
December 1,
through
December 31,
2021
$
(1)
Period from
January 1,
through
November 30,
Predecessor
Year ended
December 31,
2021
$
(9)
2020
$
(48)
Year ended
December 31,
2019
$
17
—
—
(1)
—
—
—
—
—
—
—
—
—
—
—
—
—
(2)
4
(3)
(9)
1
(1)
—
(1)
1
2
—
—
1
17
3
(1)
1
6
(6)
(2)
(17)
(5)
—
—
(4)
(51)
(1)
3
5
47
1
—
—
(2)
(80)
4
1
(18)
—
(4)
—
(3)
—
2
3
—
5
3
—
—
1
11
On November 30, 2021, Domtar Corporation was acquired by Paper Excellence and incurred significant costs to complete the transaction as well as
significant executive compensation as a result of the change in control. Certain of these transaction costs and executive compensation expenses are not
deductible for tax purposes and substantially impact the effective tax rate. The tax impact of these amounts in the Predecessor period is included in the
Nondeductible Expenses in the above table. During the Predecessor Period ending November 30, 2021, the Company recorded $3 million of tax expense
related to Global Intangible Low-Tax Income (GILTI). GILTI is an additional U.S. tax on certain income earned by foreign subsidiaries. Additionally, the
Company recorded $9 million of tax credits during the 2021 Predecessor Period, mainly research and experimentation credits, which significantly impacts
the effective tax rate.
During the Successor Period, the Company recorded $1 million of tax credits, mainly research and experimentation credits.
On January 7, 2021, the Company reached an agreement with AIP to sell the Personal Care business. As such, for the December 31, 2020 reporting period,
the Company was no longer indefinitely reinvested in that business and classified its investment in that business as held for sale. Accordingly, a deferred
tax asset of $51 million was recorded for the difference between the net book value of the business and the tax basis of that business. The Company
accounted for the tax impacts related to the sale of the Personal Care business as a stock investment and therefore recognizing the tax benefit for recording
the book/tax basis difference and the net book value adjustment as part of continuing operations. Both of these items impacted the effective tax rate in
2020.
The Company assessed the value of the deferred tax asset related to the basis difference described above, which is shown as a capital loss for tax purposes
and determined that the Company will not realize the full benefit from the asset. As such, the Company recorded a valuation allowance of $44 million
associated with this deferred tax asset. During 2020, the Company also analyzed its existing Arkansas research and development credits and recorded an
additional valuation allowance of $3 million since it is expected some of the credits will expire un-utilized. These amounts unfavorably impacted the
effective tax rate in 2020.
80
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 8. INCOME TAXES (CONTINUED)
During 2020, the Company generated a U.S. tax net operating loss which, in accordance with the Coronavirus Aid, Relief, and Economic Security
(CARES) Act will be carried back to 2015. In 2015, the US federal tax rate was 35%, versus the current rate of 21%. Therefore, the Company recorded an
additional tax benefit of $5 million related to the tax rate benefit of the loss which favorably impacted the effective tax rate in 2020.
The Company recorded $17 million of tax credits, mainly research and experimentation credits, which favorably impacted the effective tax rate in 2020.
Since the Company has a tax loss in 2020, the tax credits were carried forward and were utilized in the predecessor period.
As a result of the deemed mandatory repatriation tax requirement of the U.S. Tax Reform, the Company has taxed its undistributed foreign earnings as of
December 31, 2017, at reduced tax rates. After completing its evaluation of the U.S. Tax Reform’s impact on its business operations, the Company has
determined that it is no longer indefinitely reinvested in these undistributed foreign earnings as well as foreign earnings after December 31, 2017. As such,
as of December 31, 2020, the Company recorded a deferred tax liability of $11 million ($12 million as of December 31, 2019) for foreign withholding tax
and various state income taxes associated with future repatriation of these earnings. This additional $1 million tax benefit impacted the effective tax rate for
2020 ($2 million tax expense for 2019).
The Company recorded $18 million of tax credits in 2019, mainly research and experimentation credits, which favorably impacted the effective tax rate.
Arkansas legislation changes were passed in 2019 which reduced the state tax rate and changed how the apportionment factor is calculated. This resulted in
a deferred state tax benefit of $4 million for the Company. Additionally, a valuation allowance of $5 million was recorded on state attributes the Company
does not expect to utilize before they expire.
Deferred tax assets and liabilities are based on tax rates that are expected to be in effect in future periods when deferred items are expected to reverse.
Changes in tax rates or tax laws affect the expected future benefit or expense. The effect of such changes that occurred during each of the last three fiscal
years is included in “Tax rate changes” disclosed under the effective income tax rate reconciliation shown above.
81
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 8. INCOME TAXES (CONTINUED)
DEFERRED TAX ASSETS AND LIABILITIES
The tax effects of significant temporary differences representing deferred tax assets and liabilities at December 31, 2021 and December 31, 2020 are
comprised of the following:
Successor
Predecessor
Accounting provisions
Net operating loss carryforwards and other deductions
Pension and other employee future benefit plans
Inventory
Tax credits
Other
Gross deferred tax assets
Valuation allowance
Net deferred tax assets
Property, plant and equipment
Intangible assets
Pension and other employee future benefit plans
Inventory
Outside basis difference
Other
Total deferred tax liabilities
Net deferred tax liabilities
Included in:
Deferred income taxes and other
Total
December 31,
2021
$
36
48
—
—
30
19
133
(58)
75
(458)
(51)
(23)
(10)
(12)
(24)
(578)
(503)
(503)
(503)
December 31,
2020
$
30
56
18
11
41
12
168
(64)
104
(352)
(6)
—
—
(31)
(389)
(285)
(285)
(285)
On November 30, 2021, the Company was acquired by Paper Excellence and under the acquisition method of accounting the Company’s assets and
liabilities adjusted to fair value as of the date of the Merger. The Company has provided for deferred taxes for these adjustments as necessary. Additionally,
as a condition to obtain the approval of the Merger from the Canadian Competition Bureau, the Company was required to commit to the divestiture of its
Kamloops, British Columbia production facility and is accounting for these operations as Assets Held for Sale. Accordingly, the Company has provided for
deferred taxes on the outside basis difference that is expected to be realized when these operations are sold. This was also recorded through acquisition
accounting.
At December 31, 2021, the Company had no federal net operating loss carryforwards, however, the Company recorded a capital loss on the sale of the
Personal Care Division in 2021 of $185 million (representing a deferred tax asset of $43 million). The Company also had other foreign net operating losses
of $16 million at December 31, 2021, of which $12 million expires in 2042 and the rest are carried forward indefinitely.
In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax
assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during periods in which
temporary differences become deductible.
82
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 8. INCOME TAXES (CONTINUED)
The Company evaluates the realization of deferred tax assets on a quarterly basis. Evaluating the need for an amount of a valuation allowance for deferred
tax assets often requires significant judgment. All available evidence, both positive and negative, is considered when determining whether, based on the
weight of that evidence, a valuation allowance is needed. Specifically, the Company evaluated the following items:
•
•
•
•
•
Historical income / (losses) – particularly the most recent three-year period
Reversals of future taxable temporary differences
Projected future income / (losses)
Tax planning strategies
Divestitures
Management believes that it is more likely than not that the results of future operations will generate sufficient taxable income to realize the deferred tax
assets, with the following exceptions:
•
•
US state tax credits ($15 million valuation allowance)
Capital loss ($43 million valuation allowance)
In 2021, the valuation allowance unfavorably impacted tax expense and the effective tax rate by $1 million (2020 – $47 million and 2019 – $5 million).
As of December 31, 2021, the Company recorded a deferred tax liability of $13 million ($11 million for 2020) for foreign withholding tax and various state
income taxes associated with the repatriation of earnings subject to the repatriation tax as well as future repatriation of its unremitted foreign earnings. With
the exception of the Kamloops, British Columbia production facility, which is being shown as held for sale, the Company did not provided for deferred
taxes on the outside basis differences in its investments in its foreign subsidiaries that are unrelated to unremitted earnings as it estimates that this deferred
tax liability in combination with the repatriation tax amount, covers all tax liabilities with foreign investments to date. The Company is indefinitely
reinvested in the outside basis differences of its remaining foreign subsidiaries.
83
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 8. INCOME TAXES (CONTINUED)
ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES
At December 31, 2021, the Company had gross unrecognized tax benefits of approximately $22 million ($23 million and $28 million for 2020 and 2019,
respectively). If recognized in 2021, these tax benefits would impact the effective tax rate. These amounts represent the gross amount of exposure in
individual jurisdictions and do not reflect any additional benefits expected to be realized if such positions were sustained, such as federal deduction that
could be realized if an unrecognized state deduction was not sustained. These amounts are included in Deferred income taxes and other on the Consolidated
Balance Sheets.
Balance at beginning of year
Additions based on tax positions related to current year
Additions for tax positions of prior years
Expirations of statutes of limitations
Interest
Balance at end of year
December 31,
2021
$
23
2
—
(4)
1
22
December 31,
2020
$
28
1
1
(7)
—
23
December 31,
2019
$
28
3
2
(6)
1
28
The Company recorded $1 million of accrued interest associated with unrecognized tax benefits for the period ending December 31, 2021 (less than
$1 million for 2020 and $1 million for 2019). The Company recognizes accrued interest and penalties, if any, related to unrecognized tax benefits as a
component of tax expense. The Company believes it is reasonably possible that up to $4 million of its unrecognized benefits may be recognized by
December 31, 2022. However, the amount and timing of the recognition of these benefits is subject to some uncertainty.
The major jurisdictions where the Company and its subsidiaries will file tax returns for 2021 are Canada and the U.S. The Company will file one
consolidated U.S. federal income tax return. The Company and its subsidiaries will also file returns in various other countries in Europe and Asia as well as
various U.S. states and Canadian provinces. At December 31, 2021, the Company’s subsidiaries are subject to foreign federal income tax examinations for
the tax years 2013 through 2020, with federal years prior to 2018 being closed from a cash tax liability standpoint in the U.S. The Company does not
anticipate that adjustments stemming from these audits would result in a significant change to the results of its operations and financial condition.
84
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 9.
INVENTORIES
The following table presents the components of inventories:
Work in process and finished goods
Raw materials
Operating and maintenance supplies
Successor
December 31,
2021
$
359
110
194
663
Predecessor
December 31,
2020
$
286
91
185
562
Certain domestic raw materials, in process and finished goods inventories are valued based on the LIFO method. LIFO inventories were $213 million and
$220 million at December 31, 2021 and 2020, respectively. If inventories valued under the LIFO basis had been valued using the FIFO method, inventories
would have been $1 million lower than reported as of December 31, 2021 and $52 million greater at December 31, 2020.
The Company’s Cost of sales includes a pre-tax charge of $6 million for the period from December 1 to December 31, 2021, relating to the portion of the
step-up on inventories sold during the period.
85
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 10.
PROPERTY, PLANT AND EQUIPMENT
The following table presents the components of property, plant and equipment:
Machinery and equipment
Buildings and improvements
Timberlands
Assets under construction
Less: Accumulated depreciation
Range of useful
lives
(in years)
3 – 20
10 – 40
(1)
—
Successor
Predecessor
December 31,
2021
$
1,894
199
142
311
2,546
(22)
2,524
December 31,
2020
$
7,147
888
192
82
8,309
(6,389)
1,920
(1) Amortization is calculated using the unit of production method.
Depreciation expense related to property, plant and equipment for the 1 month ended December 31, 2021 and the 11 months ended November 30, 2021 was
$22 million and $181 million, respectively (2020 – $207 million; 2019 – $215 million).
86
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 11.
LEASES
In the normal course of business, the Company enters into operating and finance leases mainly for manufacturing and warehousing facilities, corporate
offices, motor vehicles, mobile equipment and manufacturing equipment.
While the Company’s lease payments are generally fixed over the lease term, some leases may include price escalation terms that are fixed at the lease
commencement date.
The Company has remaining lease terms ranging from 1 year to 11 years, some of which may include options to extend the leases for up to 10 years, and
some of which may include options to terminate the leases within 1 year.
The components of lease expense were as follows:
Operating lease expense
Supplemental cash flow information related to leases was as follows:
Cash paid for amounts included in the measurement of lease
liabilities:
Operating cash flows from operating leases
Operating cash flows from finance leases
Financing cash flows from finance leases
Right-of-use assets obtained in exchange for lease liabilities:
Operating leases
Finance leases
Successor
Period from
December 1,
through
December 31,
2021
$
4
Period from
January 1,
through
November 30,
2021
$
17
Predecessor
Year ended
December 31,
2020
$
22
Year ended
December 31,
2019
$
21
Successor
Period from
December 1,
through
December 31,
2021
$
Period from
January 1,
through
November 30,
2021
$
Predecessor
Year ended
December 31,
2020
$
Year ended
December 31,
2019
$
4
—
—
—
—
20
—
1
3
—
23
1
1
12
—
21
1
1
24
—
87
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 11. LEASES (CONTINUED)
Supplemental balance sheet information related to leases was as follows:
Operating leases
Operating lease right-of-use assets
Lease liabilities due within one year
Long-term operating lease liabilities
Finance leases
Property, plant and equipment
Accumulated depreciation
Long-term debt due within one year
Long-term debt
Weighted-average remaining lease term
Operating leases
Finance leases
Weighted-average discount rate
Operating leases
Finance leases
Maturities of lease liabilities at December 31, 2021 were as follows:
2022
2023
2024
2025
2026
Thereafter
Total lease payments
Less: Imputed interest
Total lease liabilities
88
Successor
Predecessor
December 31,
2021
$
December 31,
2020
$
48
19
36
55
5
(2)
3
1
3
4
59
20
50
70
4
(2)
2
1
4
5
4.3 years
6.8 years
4.7 years
7.9 years
3.2%
4.8%
4.4%
8.4%
Operating leases
$
17
16
12
6
3
5
59
4
55
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 12.
INTANGIBLE ASSETS
The following table presents the components of intangible assets:
Definite-lived intangible assets
subject to amortization
Water rights
Customer relationships
Trade Names
Technology
Non-Compete
Indefinite-lived intangible assets
not subject to amortization
Water rights
License rights
Total
Preliminary
useful lives
(in years)
40
Up to 15
Up to 20
7 – 20
9
Successor
December 31,
2021
Gross
carrying
amount
$
Accumulated
amortization
$
Predecessor
December 31,
2020
Gross carrying
amount
$
Accumulated
amortization
$
Net
$
7
171
30
—
—
208
—
—
208
—
(1)
—
—
—
(1)
—
—
(1)
7
170
30
—
—
207
—
—
207
3
24
—
8
1
36
4
6
46
(1)
(10)
—
(5)
(1)
(17)
—
—
(17)
Net
$
2
14
—
3
—
19
4
6
29
Amortization expense related to intangible assets for the 1 month ended December 31, 2021 and 11 months ended November 30, 2021 was $1 million and
$1 million, respectively ($1 million in 2020 and 2019, respectively).
Amortization expense for the next five years related to intangible assets is expected to be as follows:
Amortization expense related to intangible assets
2022
$
13
2023
$
13
2024
$
13
2025
$
13
2026
$
13
The Company performed its annual impairment test on its indefinite-lived intangible assets at October 1, 2021, 2020 and 2019, using a quantitative
approach, except for the license rights and water rights, where the Company used a qualitative approach, and determined that the estimated fair values of its
indefinite-lived intangible assets exceeded their carrying amounts. No impairment charge was recorded for indefinite-lived intangible assets during 2021,
2020 or 2019.
89
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
The following table presents the components of other assets:
Pension asset - defined benefit pension plans
Other
NOTE 13.
OTHER ASSETS
90
Successor
Predecessor
December 31,
2021
$
248
25
273
December 31,
2020
$
152
37
189
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 14.
CLOSURE AND RESTRUCTURING COSTS AND IMPAIRMENT OF LONG-LIVED ASSETS
Cost reduction program
The Company implemented a cost savings program. As part of this program, in August 2020, the Company announced the permanent closure of the
uncoated freesheet manufacturing at the Kingsport, Tennessee and Port Huron, Michigan mills, the remaining paper machine at the Ashdown, Arkansas
mill and the converting center in Ridgefields, Tennessee. Additionally, in May 2021, the Company announced the closure of the converting center in
Dallas, Texas. These actions reduced the Company’s annual uncoated freesheet paper capacity by approximately 721,000 short tons and resulted in a
workforce reduction of approximately 750 employees. For the 1 month ended December 31, 2021 and the 11 months ended November 30, 2021, the
Company recorded nil and $9 million, respectively, of accelerated depreciation under Impairment of long-lived assets and a reversal of $1 million and
$17 million, respectively, of closure costs, under Closure and restructuring costs on the Consolidated Statement of Earnings (Loss) and Comprehensive
Income (Loss).
For the year ended December 31, 2020, the Company recorded $136 million of accelerated depreciation under Impairment of long-lived assets on the
Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss). Additionally, the Company recorded $99 million of closure costs, largely
related to severance costs, inventory write downs and environmental liabilities, under Closure and restructuring costs on the Consolidated Statement of
Earnings (Loss) and Comprehensive Income (Loss).
Conversion of Kingsport, Tennessee mill
The Company plans to enter the linerboard market with the conversion of the Kingsport paper machine. Once in full operation, the mill will produce and
market approximately 600,000 tons annually of high-quality recycled linerboard and medium, providing the Company with a strategic footprint in a
growing adjacent market. The conversion is expected to be completed by the end of 2022. The Company estimates the capitalized conversion cost to be
approximately $350 million. For the 1 month ended December 31, 2021 and the 11 months ended November 30, 2021, the Company recorded $3 million
and $27 million, respectively, under Asset conversion costs on the Consolidated Statement of Earnings (Loss) and Comprehensive Income (Loss).
Ashdown, Arkansas mill and Port Huron, Michigan mill
On September 27, 2019, the Company’s Board of Directors approved the decision to permanently shut down two paper machines, which was announced on
October 3, 2019. The closures took place at the Ashdown, Arkansas pulp and paper mill and the Port Huron, Michigan paper mill.
For the year ended December 31, 2019, the Company recorded $32 million of accelerated depreciation under Impairment of long-lived assets and $1
million of accelerated depreciation under Depreciation and amortization, on the Consolidated Statement of Earnings (Loss) and Comprehensive Income
(Loss). Additionally, the Company recorded $22 million of closure costs, largely related to severance costs, under Closure and restructuring costs.
91
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 14. CLOSURE AND RESTRUCTURING COSTS AND IMPAIRMENT OF LONG-LIVED ASSETS (CONTINUED)
The following table provides the activity in the closure and restructuring and transaction costs liability:
Balance at beginning of year
Additions
Payments
Balance at end of year (1)
December 31,
2021
$
28
21
(28)
21
December 31,
2020
$
12
48
(32)
28
(1) At December 31, 2021, $12 million is shown in Trade and other payables and $9 million is shown in Other liabilities and deferred credits.
The $21 million provision is comprised of severance and termination costs of $2 million related to the Pulp and Paper business, as well as transaction costs
of $6 million and license fees and other costs of $13 million related to Corporate.
Closure and restructuring costs are based on management’s best estimates at December 31, 2021. Actual costs may differ from these estimates due to
subsequent developments such as the results of environmental studies, the ability to find a buyer for assets set to be dismantled and demolished and other
business developments. As such, additional costs and further impairment charges may be required in future periods.
92
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 15.
TRADE AND OTHER PAYABLES
The following table presents the components of trade and other payables:
Trade payables
Payroll-related accruals
Other accruals
93
Successor
December 31,
2021
$
297
131
115
543
Predecessor
December 31,
2020
$
242
98
116
456
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 16.
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT
The following table presents the changes in Accumulated other comprehensive income (loss) by component(1) for the periods ended December 31, 2020,
November 30, 2021 and December 31, 2021.
Predecessor
Balance at December 31, 2019
Natural gas swap contracts
Currency options
Foreign exchange forward contracts
Net loss
Foreign currency items
Other comprehensive income (loss) before
reclassifications
Amounts reclassified from Accumulated other
comprehensive loss
Net current period other comprehensive
income (loss)
Balance at December 31, 2020
Natural gas swap contracts
Foreign exchange forward contracts
Net gain
Foreign currency items
Other comprehensive income before
reclassifications
Amounts reclassified from Accumulated other
comprehensive loss
Net current period other comprehensive
(loss) income
Balance at November 30, 2021
Elimination of Predecessor's Accumulated
other comprehensive loss
Balance at November 30, 2021
Foreign currency
items
Net derivative
gains (losses) on
cash flow hedges
Pension items(2)
$
(197)
N/A
N/A
N/A
(21)
N/A
$
(5)
1
3
23
N/A
N/A
Post-retirement
benefit items(2)
$
11
N/A
N/A
N/A
(1)
N/A
(21)
11
(10)
(207)
N/A
N/A
85
N/A
85
10
95
(112)
112
—
(1)
(2)
(3)
8
N/A
N/A
5
N/A
5
(1)
4
12
(12)
—
27
12
39
34
22
2
N/A
N/A
24
(31)
(7)
27
(27)
—
94
$
(202)
N/A
N/A
N/A
N/A
63
63
—
63
(139)
N/A
N/A
N/A
57
57
—
57
(82)
82
—
Total
$
(393)
1
3
23
(22)
63
68
21
89
(304)
22
2
90
57
171
(22)
149
(155)
155
—
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 16. CHANGES IN ACCUMULATED OTHER COMPREHENSIVE LOSS BY COMPONENT (CONTINUED)
Successor
Balance at November 30, 2021
Natural gas swap contracts
Foreign exchange forward contracts
Net gain (loss)
Foreign currency items
Other comprehensive income (loss) before
reclassifications
Amounts reclassified from Accumulated other
comprehensive income
Net current period other comprehensive
income (loss)
Balance at December 31, 2021
Net derivative
gains (losses) on
cash flow hedges
Pension items(2)
$
—
N/A
N/A
17
N/A
$
—
(3)
3
N/A
N/A
Post-retirement
benefit items(2)
$
—
N/A
N/A
(1)
N/A
Foreign currency
items
—
—
—
—
17
—
17
17
(1)
—
(1)
(1)
$
—
N/A
N/A
N/A
8
8
—
8
8
Total
$
—
(3)
3
16
8
24
—
24
24
(1) All amounts are after tax. Amounts in parentheses indicate losses.
(2) The projected benefit obligation is actuarially determined on an annual basis as of December 31.
95
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 16. CHANGES IN ACCUMULATED OTHER COMPREHENSIVE LOSS BY COMPONENT (CONTINUED)
The following table presents reclassifications out of Accumulated other comprehensive income (loss):
Details about Accumulated other comprehensive
income (loss) components
Amounts reclassified from
Accumulated other comprehensive income (loss)
Net derivative gains (losses) on cash flow hedge
Natural gas swap contracts (1)
Currency options and forwards (1)
Net investment hedge (2)
Total before tax
Tax (expense) benefit
Net of tax
Amortization of defined benefit pension items
Amortization of net actuarial loss (3)(4)
Amortization of prior year service cost (3)
Discontinued operations
Total before tax
Tax benefit
Net of tax
Amortization of other post-retirement benefit items
Amortization of net actuarial gain (3)
Amortization of prior year service credit (3)
Total before tax
Tax expense
Net of tax
Successor
Period from
December 1,
through
December 31,
2021
$
Period from
January 1,
through
November 30,
2021
$
Predecessor
Year ended
December 31,
2020
$
Year ended
December 31,
2019
$
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
10
38
(9)
39
(8)
31
(7)
(1)
(4)
(12)
2
(10)
1
1
2
(1)
1
(10)
(6)
—
(16)
4
(12)
(12)
(2)
—
(14)
3
(11)
1
1
2
—
2
(4)
(7)
—
(11)
3
(8)
(40)
(5)
—
(45)
12
(33)
1
1
2
(1)
1
(1)
(2)
(3)
(4)
These amounts are included in Cost of sales in the Consolidated Statements of Earnings (Loss) and Comprehensive Income (Loss).
This amount is included in Earnings from discontinued operations, net of taxes in the Consolidated Statements of Earnings (Loss) and
Comprehensive Income (Loss).
These amounts are included in the computation of net periodic benefit cost (see Note 6 "Pension Plans and Other Post-Retirement Benefit Plans" for
more details).
In 2021, the non-cash settlement was nil (2020 – $2 million; 2019 – $30 million).
96
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 17.
LONG-TERM DEBT
Maturity
2022
2042
2044
2028
2026
2028
2025
2021 - 2028
Par
Amount
$
300
250
250
775
—
525
—
Currency
Successor
December 31,
2021
$
Predecessor
December 31,
2020
$
US
US
US
US
US
US
US
—
264
262
775
115
520
—
4
1,940
300
249
250
—
—
—
294
5
1,098
38
6
259
1,643
13
1,079
Unsecured notes
4.4% Notes
6.25% Notes
6.75% Notes
Senior secured notes
6.75% Notes
ABL Revolving Credit Facility
First Lien Term Loan
Term Loan
Finance lease obligations
Less: Unamortized debt issuance costs
Less: Due within one year
Principal long-term debt repayments, including finance lease obligations, in each of the next five years will amount to:
2022
2023
2024
2025
2026
Thereafter
Less: Amounts representing interest
Total payments
97
Long-term debt
$
373
26
26
26
141
1,323
1,915
—
1,915
Finance
leases
$
1
1
1
1
1
1
6
2
4
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 17. LONG-TERM DEBT (CONTINUED)
4.4% UNSECURED NOTES
On April 8, 2021, the Company redeemed the 4.4% Notes, originally due in 2022, at a redemption price of 100% of the principal amount of $300 million,
plus accrued and unpaid interest, as well as a make-whole premium of $11 million.
ABL REVOLVING CREDIT FACILITY
On November 30, 2021, the Company entered into an ABL Revolving Credit Facility that matures on November 30, 2026. The ABL Revolving Credit
Facility is available to Domtar Corporation and certain other domestic and Canadian subsidiaries and provides for revolving loans and letters of credit in an
aggregate amount of up to $400 million, subject to borrowing base capacity.
Borrowings under the ABL Revolving Credit Facility is limited by borrowing base calculations based on the sum of specified percentages of eligible
accounts receivable, plus specified percentages of eligible inventory, plus specified percentages of qualified cash, minus the amount of any applicable
reserves. Borrowings bear interest at a floating rate, which can be either an adjusted Eurodollar rate plus an applicable margin or, at the Company’s option,
a base rate plus an applicable margin.
The Company’s obligations under the ABL Revolving Credit Facility are guaranteed by its immediate parent (a company with no assets other than Domtar
shares) and its wholly-owned material U.S. subsidiaries and wholly-owned material Canadian subsidiaries. The ABL Revolving Credit Facility has a first-
priority lien on the current assets of such U.S. and Canadian subsidiaries and second-priority lien on the fixed assets of its wholly-owned material U.S.
subsidiaries, excluding principal properties (second in priority to the liens securing on First Lien Term Loan Facility (the “Term Loan Facility”) discussed
below), in each case, subject to permitted liens.
Borrowings under the ABL Revolving Credit Facility bear interest at LIBOR, EURIBOR, Canadian bankers' acceptance or prime rate, as applicable, plus a
margin linked to the Company’s utilization of the credit. In addition, the Company pays facility fees quarterly at rates linked to its utilization of the credit.
The Company does not anticipate a significant impact to its financial position from the planned phase out of LIBOR.
The ABL Revolving Credit Facility contains customary covenants, including, but not limited to, restrictions on the Company’s ability and that of its
subsidiaries to merge and consolidate with other companies, incur indebtedness, grant liens or security interests on assets, make acquisitions, loans,
advances or investments, pay dividends, sell or otherwise transfer assets, optionally prepay or modify terms of any junior indebtedness, enter into
transactions with affiliates or change its line of business.
The ABL Revolving Credit Facility requires the maintenance of a fixed charge coverage of 1.00 to 1.00 at the end of each fiscal quarter for the prior twelve
month period when specified excess availability is less than the greater of $35 million and 10% of the lesser of the borrowing base and maximum
borrowing capacity. This covenant did not apply at December 31, 2021.
FIRST LIEN TERM LOAN FACILITY
On November 30, 2021, the Company entered into a Term Loan Facility maturing November 30, 2028, of which $525 million was immediately drawn and
up to $250 million was available on a delayed draw basis (the “Delayed Draw Term Loan”) to fund redemptions of the Existing Domtar Notes pursuant to
the Domtar Notes Change of Control Offers that terminated on January 3, 2022.
Borrowings under the Term Loan Facility amortize in equal quarterly installments in an amount equal to 1% per annum of the principal amount in 2022 and
5% per annum thereafter.
The interest rate margin applicable to borrowings under the Term Loan Facility is, at the Company’s option, either (1) the base rate plus an applicable
margin or (2) LIBOR plus an applicable margin. The Term Loan Facility is subject to a LIBOR floor of 0.75%.
The Company is required to prepay the Term Loan Facility and Senior Secured Notes with 100% of the net cash proceeds of certain asset sales subject to
certain reinvestment rights. The Company is required to prepay the Term Loan Facility with 100% of the net cash proceeds of certain debt issuances and
50% of excess cash flow in each case, subject to certain exceptions.
98
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 17. LONG-TERM DEBT (CONTINUED)
The Company’s obligations under the Term Loan Facility are guaranteed by its immediate parent (a company with no assets other than Domtar shares) and
all of the Issuer’s direct and indirect wholly-owned material U.S. subsidiaries. The Term Loan Facility has a first-priority lien on the fixed assets of its
wholly-owned material U.S. subsidiaries’ fixed assets and a second-priority lien on the current asset collateral (second in priority to the liens securing the
ABL Credit Facility discussed above), in each case, subject to other permitted liens.
The Term Loan Facility contains customary negative covenants consistent with those applicable to the Notes, including, but not limited to, restrictions on
the Company’s ability and that of its restricted subsidiaries to merge and consolidate with other companies, incur indebtedness, grant liens or security
interests on assets, pay dividends or make other restricted payments, sell or otherwise transfer assets or enter into transactions with affiliates.
On January 7, 2022, the Company utilized $127 million under the delayed draw term facility to fund a portion of the redemptions of the Existing Domtar
Notes pursuant to the Domtar Notes Change of Control Offers that terminated on January 3, 2022. The remainder of the Delayed Draw Term Loan facility
was cancelled, leaving total drawings under the Term Loan Facility of $652 million.
SENIOR SECURED NOTES
Pearl Merger Sub Inc., a newly formed, wholly-owned subsidiary of Pearl Excellence Holdco L. P., a Delaware limited partnership, was the initial issuer of
the $775 million aggregate principal amount of 6.75% Senior Secured Notes due 2028 (the ‘‘Notes’’). This note issue was part of financing related to the
acquisition of Domtar by Pearl Excellence Holdco L.P. Upon the completion of the acquisition, the initial issuer was merged with and into Domtar with
Domtar surviving the Merger and becoming the obligor of the Notes.
The Notes will mature on October 1, 2028 and interest on the Notes will be payable in cash semi-annually in arrears on April 1 and October 1 of each year,
commencing on April 1, 2022.
Pending completion of the Domtar Existing Notes Change of Control Offers that terminated on January 3, 2022, $250 million of the proceeds of the Note
issue was set aside as restricted cash to fund approximately half of funds required to complete the Change of Control Offers. Such funds are reflected as
restricted cash and included in Cash and cash equivalents on the Balance Sheet at December 31, 2021. Funds not utilized were to be used to redeem a
portion of the Senior Secured Notes at a 100% price.
The Company’s obligations under the Senior Secured Notes are guaranteed by its immediate parent and all of the Issuer’s direct and indirect wholly-owned
material U.S. subsidiaries. The Senior Secured Notes will be secured by a lien on substantially all of the Issuer’s direct and indirect wholly-owned material
U.S. subsidiaries’ fixed assets and a second-priority lien on the Current Asset Collateral (second in priority to the liens securing the ABL Credit Facility
discussed above), in each case, subject to other permitted liens.
The Senior Secured Notes contain customary negative covenants consistent with those applicable to the Notes, including, but not limited to, restrictions on
the Company’s ability and that of its restricted subsidiaries to merge and consolidate with other companies, incur indebtedness, grant liens or security
interests on assets, pay dividends or make other restricted payments, sell or otherwise transfer assets or enter into transactions with affiliates.
99
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 17. LONG-TERM DEBT (CONTINUED)
On January 7, 2022, $133 million of the Senior Secured Notes were redeemed as a result of the Domtar Existing Notes Change of Control Offers that
terminated on January 3, 2022, leaving $642 million of Notes outstanding.
TERM LOAN
On May 5, 2020, the Company entered into a $300 million Term Loan Agreement with a maturity date of May 5, 2025. The Company used borrowings
under the Term Loan Agreement to repay other debt and to pay related fees and expenses.
At December 31, 2020, the Company had $294 million of borrowings outstanding under the Term Loan Agreement.
On March 11, 2021, the Company fully repaid its Term Loan Agreement, originally maturing on May 5, 2025, in the amount of $294 million and wrote-off
$2 million of unamortized debt issuance costs related to this repayment.
REVOLVING CREDIT FACILITY
The Company had an unsecured $700 million revolving credit facility that was terminated on November 30, 2021. At December 31, 2020, the Company
had no borrowings and $54 million of letters of credit outstanding under this facility.
RECEIVABLES SECURITIZATION
The Company had a $150 million receivables securitization facility that terminated in October 2021. At December 31, 2020, there were no borrowings and
no letters of credit outstanding under this facility.
For the 1 month ended December 31, 2021 and the 11 months ended November 30, 2021, a net charge of nil and $1 million, respectively (2020 –
$1 million; 2019 – $2 million) resulted from the program described above and was included in Interest expense, net in the Consolidated Statements of
Earnings (Loss) and Comprehensive Income (Loss).
EXISTING DOMTAR NOTES CHANGE OF CONTROL OFFERS
Following the change of control of Domtar, Domtar was obligated, pursuant to the indenture governing the 6.25% Notes due 2042 and the 6.75% Notes due
2044 (“Existing Domtar Notes”), to make the Existing Domtar Notes Change of Control Offers, pursuant to which Domtar offered to repurchase all of the
Existing Domtar Notes from holders at a purchase price of 101%. Up to $250 million under the Delayed Draw Term Loan and up to $250 million of
proceeds of the issue of Notes was earmarked for the repurchase of the Existing Domtar Notes pursuant to the Existing Domtar Notes Change of Control
Offers. Up to $250 million aggregate principal amount of the Senior Secured Notes was subject to special mandatory redemption to the extent proceeds
were not used to fund the redemptions of the Existing Domtar Notes pursuant to the Existing Domtar Notes Change of Control Offers.
On January 3, 2022, $134 million of the 6.25% Notes due 2042 and $100 million of the 6.75% Notes due 2044 were tendered pursuant to the offer. As a
result, $116 million of the 6.25% Notes due 2042 and $150 million of the 6.75% Notes due 2044, remain outstanding post January 7, 2022, the payment
date.
100
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 18.
OTHER LIABILITIES AND DEFERRED CREDITS
The following table presents the components of other liabilities and deferred credits:
.
Successor
Predecessor
Liability - other post-retirement benefit plans
Pension liability - defined benefit pension plans
Pension liability - multiemployer plan withdrawal
Other
101
December 31,
2021
$
55
59
38
64
216
December 31,
2020
$
62
124
40
84
310
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 19.
SHAREHOLDERS’ EQUITY
Acquisition of Domtar Corporation by Paper Excellence
On November 30, 2021, Paper Excellence completed the acquisition of all the outstanding common shares of Domtar Corporation (the “Company”) by
means of a merger of Pearl Merger Sub (a wholly-owned subsidiary) with and into the Company with the Company continuing as the surviving corporation
and as a subsidiary of Paper Excellence (the “Merger”). On the terms and subject to the conditions set forth in the Merger Agreement, each share of the
Company’s outstanding common stock was converted into the right to receive $55.50 in cash, upon which the shares were cancelled.
COMMON STOCK
At December 31, 2021, the Company has 100 common shares, par value of $0.01 per share.
Prior to the acquisition, the Company was authorized to issue two billion shares of common stock, par value $0.01 per share. Holders of the Company’s
common stock were entitled to one vote per share.
The changes in the number of outstanding common stock and their aggregate stated value during the years ended December 31, 2021 and December 31,
2020, were as follows:
Common stock
Balance at beginning
of period
Shares cancelled
Shares issued
Treasury stock (1)
Common shares
Balance at end of period
Successor
December 31,
2021
Number
of shares
Predecessor
November 30,
2021
December 31,
2020
$
Number
of shares
$
Number
of shares
50,379,090
(50,379,090)
1
(1)
55,194,538
—
1 56,880,910
—
—
—
100
100
—
—
—
(4,815,448)
—
50,379,090
— (1,686,372)
—
—
1 55,194,538
$
1
—
—
—
1
(1) During 2021, the Company repurchased 5,060,865, and issued 245,417 shares out of Treasury stock in conjunction with the exercise of stock-
based compensation awards.
DIVIDENDS
During 2020, the Company declared one quarterly dividend of $0.455 per share, to holders of the Company’s common stock. Total dividends of
approximately $25 million were paid on April 15, 2020, to shareholders of record as of April 2, 2020.
STOCK REPURCHASE PROGRAM
During 2021, the Company repurchased a total of 5,060,865 shares at an average price of $46.96 for a total cost of $238 million.
During 2020, the Company repurchased 1,798,306 shares at an average price of $33.05 for a total cost of $59 million.
102
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 20.
COMMITMENTS AND CONTINGENCIES
ENVIRONMENTAL MATTERS
The Company is subject to environmental laws and regulations enacted by federal, provincial, state and local authorities. The Company may also incur
substantial costs in relation to enforcement actions (including orders requiring corrective measures, installation of pollution control equipment or other
remedial actions) as a result of violations of, or liabilities under, environmental laws and regulations applicable to its past and present properties. The
Company’s ongoing efforts to identify potential environmental concerns that may be associated with such properties may result in additional environmental
costs and liabilities which cannot be reasonably estimated at this time.
For the 1 month ended December 31, 2021 and the 11 months ended November 30, 2021, the Company’s operating expenses for environmental matters
amounted to $3 million and $37 million, respectively (2020 – $60 million; 2019 – $68 million).
The Company made capital expenditures for environmental matters of $1 million and $4 million, respectively, during the 1 month ended December 31,
2021 and the 11 months ended November 30, 2021 (2020 – $2 million; 2019 – $19 million).
A former owner of the Company’s Dryden, Ontario manufacturing site (the "Dryden Property") operated a chlor-alkali plant during the 1960s and 1970s,
during which time, mercury and other pollutants were used and discharged into the environment. In conjunction with the sale and redevelopment of the
Dryden Property, the Province of Ontario (the “Province”) provided a broad indemnity (the "Indemnity") in 1985 to the then purchaser of the Dryden
Property and its successors and assigns with respect to the discharge of any pollutant, including mercury, by the historical operators of the Dryden Property.
This Indemnity subsequently was assigned to the Company in connection with its 2007 purchase of the Dryden Property.
As the current owner of the Dryden Property, the Company is actively engaged with the Province with respect to the management of the historical
contamination.
The Province issued a Director's order under environmental laws to certain prior owners of the Dryden Property in connection with a nearby waste disposal
site that has never been owned by the Company. The Director's order required certain work to be conducted by those prior owners. The prior owners
asserted that the Indemnity covered the work required by the Director’s order. Following extensive litigation, the Supreme Court of Canada found, among
other things, that the Indemnity covered third-party claims, but not first-party claims, such as the Director's order.
In the future, the Province may challenge whether the Company has the benefit of the Indemnity. In addition to the Indemnity, Domtar has other recourses
relating to the historical contamination.
The situation involving the historical contamination is continuing to develop, and the Company cannot predict its outcome. While the Company currently
does not believe that it will be required to incur costs that would have a material impact on its results of operations or financial condition, there is no
certainty that this is in fact the case.
103
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 20. COMMITMENTS AND CONTINGENCIES (CONTINUED)
The following table reflects changes in the reserve for environmental remediation and asset retirement obligations:
Balance at beginning of year
Additions and other changes
Environmental spending
Balance at end of year (1)
December 31,
2021
$
42
3
(4)
41
December 31,
2020
$
31
14
(3)
42
(1) At December 31, 2021, $8 million is shown in Trade and other payables and $33 million is shown in Other liabilities and deferred credits.
At December 31, 2021, anticipated undiscounted payments in each of the next five years are as follows:
Environmental provision and asset
retirement obligations
2022
$
2023
$
2024
$
2025
$
2026
Thereafter
$
$
Total
$
8
2
6
2
2
56
76
The U.S. Environmental Protection Agency (the “EPA”) and/or various state agencies have notified the Company that it may be a potentially responsible
party under the Comprehensive Environmental Response Compensation and Liability Act, commonly known as “Superfund”, and similar state laws with
respect to other hazardous waste sites as to which no proceedings have been instituted against the Company. The Company continues to take remedial
action under its Care and Control Program at its former wood preserving sites, and at a number of operating sites, due to possible soil, sediment or
groundwater contamination.
CONTINGENCIES
In the normal course of operations, the Company becomes involved in various legal actions mostly related to contract disputes, patent infringements,
environmental and product warranty claims, and labor issues. While the final outcome with respect to actions outstanding or pending at December 31,
2021, cannot be predicted with certainty, it is management’s opinion that their resolution will not have a material adverse effect on the Company’s financial
position, results of operations or cash flows.
OTHER COMMERCIAL COMMITMENTS
The Company has commitments to purchase property, plant and equipment, roundwood, wood chips, gas and certain chemicals. Purchase orders in the
normal course of business are excluded from the table below. Any amounts for which the Company is liable under purchase orders are reflected in the
Consolidated Balance Sheets as Trade and other payables. Minimum future payments under these other commercial commitments, determined at
December 31, 2021, were as follows:
Other commercial commitments
2022
$
233
2023
2024
2025
2026
Thereafter
$
12
$
9
$
—
$
—
$
—
Total
$
254
104
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 20. COMMITMENTS AND CONTINGENCIES (CONTINUED)
INDEMNIFICATIONS
In the normal course of business, the Company offers indemnifications relating to the sale of its businesses and real estate. In general, these
indemnifications may relate to claims from past business operations, compliance with laws, the failure to abide by covenants and the breach of
representations and warranties included in the sales agreements. Typically, such representations and warranties relate to taxation, environmental, product
and employee matters. The terms of these indemnification agreements are generally for an unlimited period of time. At December 31, 2021, the Company
is unable to estimate the potential maximum liabilities for these types of indemnification guarantees as the amounts are contingent upon the outcome of
future events, the nature and likelihood of which cannot be reasonably estimated at this time. Accordingly, no provision has been recorded. These
indemnifications have not yielded a significant expense in the past.
Pension Plans
The Company has indemnified and held harmless the trustees of its pension funds, and the respective officers, directors, employees and agents of such
trustees, from any and all costs and expenses arising out of the performance of their obligations under the relevant trust agreements, including in respect of
their reliance on authorized instructions from the Company or for failing to act in the absence of authorized instructions. These indemnifications survive the
termination of such agreements. At December 31, 2021 the Company has not recorded a liability associated with these indemnifications, as it does not
expect to make any payments pertaining to these indemnifications.
CLIMATE CHANGE AND AIR QUALITY REGULATIONS
Various national and local laws and regulations relating to climate change have been established or are emerging in jurisdictions where the Company
currently has, or may have in the future, manufacturing facilities or investments.
The EPA repealed the Clean Power Plan and replaced it with the “Affordable Clean Energy” (“ACE”) rule. The ACE rule was legally challenged in the
U.S. Court of Appeals for the D.C. Circuit. The Court ruled the EPA wrongly understood the Clean Air Act, vacated the ACE rule, sending it back to the
EPA for further consideration. The court also rejected the embedded repeal of the Clean Power Plan, but the court stayed its mandate as to that part of its
decision to avoid reinstating that now outdated Clean Power Plan. Four petitions of certiorari were filed with the United States Supreme Court seeking
review of the D.C. Circuit’s decision, and the Supreme Court decided to hear the appeal. Oral argument is scheduled for February 28, 2022, and a decision
is expected in the Summer of 2022. Regardless of the outcome of the petitions for certiorari and EPA’s further consideration, the Company does not expect
to be disproportionately affected compared with other pulp and paper producers located in the states where the Company operates.
The province of Quebec has a greenhouse gas (“GHG”) cap-and-trade system with reduction targets. British Columbia has a carbon tax that applies to the
purchase of fossil fuels within the province. The Company does not expect its facilities to be disproportionately affected by these measures compared to the
other pulp and paper producers located in these provinces.
The Government of Canada has established a federal carbon pricing system in provinces that do not already impose a cost on carbon emissions. The
Government of Canada has imposed its carbon pricing program for regulating GHG emissions in Ontario, which took effect on January 1, 2019. To reduce
GHG emissions and recognize the unique circumstances of the province’s diverse economy, Ontario finalized its own GHG Emission Performance
Standards regulation. The Canadian Government has accepted Ontario’s program as an alternative to the federal program and the transition for Ontario
facilities from the federal program to the Ontario program occurred on January 1, 2022. The Company does not expect to be disproportionately affected
compared with other pulp and paper producers located in Ontario.
The EPA proposed to revise its Industrial Boiler Maximum Achievable Control Technology Standard (“MACT”), or Boiler MACT, in a notice published
on August 24, 2020. The proposed rule is a response to two court decisions that remanded certain issues for further review by the EPA, and it includes
revisions to 34 different emission limitations that could apply to some of the Company’s facilities. The EPA had planned to issue the final rule in September
2021, but the final rule has been delayed. Although the EPA has indicated that a small number of facilities may need to reduce emissions further compared
to the current limits, the Company does not expect its facilities to be disproportionately affected compared to other U.S. pulp and paper producers.
105
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 21.
DERIVATIVES AND HEDGING ACTIVITIES AND FAIR VALUE MEASUREMENT
HEDGING PROGRAMS
The Company is exposed to market risk, such as changes in currency exchange rates, commodity prices and interest rates. To the extent the Company
decides to manage the volatility related to these exposures, the Company may enter into various financial derivatives that are accounted for under the
derivatives and hedging guidance. These transactions are governed by the Company's hedging policies which provide direction on acceptable hedging
activities, including instrument type and acceptable counterparty exposure.
Upon inception, the Company formally documents the relationship between hedging instruments and hedged items. At inception and quarterly thereafter,
the Company formally assesses whether the financial instruments used in hedging transactions are effective at offsetting changes in either the cash flow or
the fair value of the underlying exposures. The Company does not hold derivative financial instruments for trading purposes.
CREDIT RISK
The Company is exposed to credit risk on accounts receivables from its customers. In order to reduce this risk, the Company reviews new customers’ credit
history before granting credit and conducts regular reviews of existing customers’ credit performance. As of December 31, 2021, two customers located in
the U.S. represented 28% or $130 million, of the Company’s receivables (December 31, 2020 – two customers located in the U.S. represented 29% or
$104 million).
The Company is exposed to credit risk in the event of non-performance by counterparties to its financial instruments. The Company attempts to minimize
this exposure by entering into contracts with counterparties that are believed to be of high credit quality. Collateral or other security to support financial
instruments subject to credit risk is usually not obtained. The credit standing of counterparties is regularly monitored.
INTEREST RATE RISK
The Company is exposed to interest rate risk arising from fluctuations in interest rates on its cash and cash equivalents, bank indebtedness, revolving credit
facility, term loan and long-term debt. The Company’s objective in managing exposure to interest rate changes is to minimize the impact of interest rate
changes on earnings and cash flows and to lower its overall borrowing costs. The Company may manage this interest rate exposure through the use of
derivative instruments such as interest rate swap contracts, whereby it agrees to exchange the difference between fixed and variable interest amounts
calculated by reference to an agreed upon notional principal amount.
EQUITY RISK
The Company was exposed to changes in share prices with regard to its stock-based compensation program. The Company managed its exposure through
the use of derivative instruments such as equity swap contracts. In March 2020, the Company entered into a total return swap agreement covering 500,000
common shares which was settled on November 30, 2021.
106
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 21. DERIVATIVES AND HEDGING ACTIVITIES AND FAIR VALUE MEASUREMENT (CONTINUED)
COST RISK
Cash flow hedges:
The Company is exposed to price volatility for raw materials and energy used in its manufacturing process. The Company manages its exposure to cost risk
primarily through the use of supplier contracts. The Company purchases natural gas at the prevailing market price at the time of delivery. To reduce the
impact on cash flow and earnings due to pricing volatility, the Company may utilize derivatives to fix the price of forecasted natural gas purchases. The
changes in the fair value on qualifying instruments are included in Accumulated other comprehensive income (loss) to the extent effective, and reclassified
into Cost of sales in the period during which the hedged transaction affects earnings. Current contracts are used to hedge a portion of forecasted purchases
over the next 24 months.
As of December 31, 2021, the Company hedged 27% and 10% of its forecasted purchases under derivative contracts for 2022 and 2023, respectively. The
natural gas derivative contracts were effective as of December 31, 2021.
FOREIGN CURRENCY RISK
Cash flow hedges:
The Company has manufacturing operations in the United States and Canada. As a result, it is exposed to movements in foreign currency exchange rates in
Canada. Moreover, certain assets and liabilities are denominated in Canadian dollars and are exposed to foreign currency movements. Accordingly, the
Company’s earnings are affected by increases or decreases in the value of the Canadian dollar. The Company’s risk management policy allows it to hedge a
significant portion of its exposure to fluctuations in foreign currency exchange rates for periods up to three years. The Company may use derivative
financial instruments (currency options and foreign exchange forward contracts) to mitigate its exposure to fluctuations in foreign currency exchange rates.
Derivatives are used to hedge forecasted purchases in Canadian dollars by the Company’s Canadian subsidiary over the next 19 months. Such derivatives
are designated as cash flow hedges. The changes in the fair value on qualifying instruments are included in Accumulated other comprehensive income
(loss) to the extent effective, and reclassified into Sales or Cost of sales in the period during which the hedged transaction affects earnings.
As of December 31, 2021, the Company hedged 62% and 18% of its forecasted net cash exposures under contracts for 2022 and 2023, respectively. The
foreign exchange derivative contracts were effective as of December 31, 2021.
FAIR VALUE MEASUREMENT
The accounting standards for fair value measurements and disclosures establish a fair value hierarchy, which prioritizes the inputs to valuation techniques
used to measure fair value into three levels. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input
that is available and significant to the fair value measurement.
Level 1
Level 2
Quoted prices in active markets for identical assets or liabilities.
Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar
assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for
substantially the full term of the assets or liabilities.
Level 3
Inputs that are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use
in pricing the asset or liability.
107
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 21. DERIVATIVES AND HEDGING ACTIVITIES AND FAIR VALUE MEASUREMENT (CONTINUED)
The following tables present information about the Company’s financial assets and financial liabilities measured at fair value on a recurring basis (except
Long-term debt, see (b) and (c) below) at December 31, 2021 and December 31, 2020, in accordance with the accounting standards for fair value
measurements and disclosures and indicates the fair value hierarchy of the valuation techniques utilized by the Company to determine such fair value.
Fair Value of financial instruments at:
Derivatives designated as
hedging instruments:
Asset derivatives
Currency derivatives
Natural gas swap contracts
Natural gas swap contracts
Total Assets
Liabilities derivatives
Currency derivatives
Currency derivatives
Total Liabilities
Other Instruments:
Long-term debt due within one
year
Long-term debt
Successor
Quoted prices in
active markets for
identical assets
(Level 1)
$
December 31,
2021
$
Significant
observable
inputs
(Level 2)
$
Significant
unobservable
inputs
(Level 3)
$
Balance sheet classification
18
6
2
26
1
1
2
(a)Prepaid expenses
(a)Prepaid expenses
(a)Other assets
—
—
—
—
—
(a)Trade and other payables
Other liabilities and deferred
credits
(a)
—
—
259
1,682
Long-term debt due within
(b)
one year
(c)Long-term debt
—
—
18
6
2
26
1
1
2
259
1,682
—
—
—
—
—
—
—
—
—
108
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 21. DERIVATIVES AND HEDGING ACTIVITIES AND FAIR VALUE MEASUREMENT (CONTINUED)
Fair Value of financial instruments at:
Derivatives designated as
hedging instruments:
Asset derivatives
Currency derivatives
Currency derivatives
Natural gas swap contracts
Total Assets
Liabilities derivatives
Currency derivatives
Natural gas swap contracts
Natural gas swap contracts
Total Liabilities
Other Instruments:
Stock-based compensation -
liability awards
Stock-based compensation -
liability awards
Equity swap contracts
Long-term debt due within one
year
Long-term debt
Predecessor
December 31,
2020
$
Quoted prices in
active markets for
identical assets
(Level 1)
$
Significant
observable
inputs
(Level 2)
$
Significant
unobservable
inputs
(Level 3)
$
Balance sheet classification
31
16
1
48
1
2
3
6
5
11
2
13
1,216
—
—
—
—
—
—
—
—
5
11
2
—
—
31
16
1
48
1
2
3
6
—
—
—
13
1,216
(a)Prepaid expenses
(a)Other assets
(a)Other assets
—
—
—
—
—
—
(a)Trade and other payables
(a)Trade and other payables
Other liabilities and deferred
credits
(a)
—
—
—
—
—
—
—
Trade and other payables
Other liabilities and deferred
credits
Other assets
Long-term debt due within
one year
(b)
(c)Long-term debt
(a)
Fair value of the Company’s derivatives are classified under Level 2 (inputs that are observable; directly or indirectly) as it is measured as
follows:
-
-
For currency derivatives: Foreign currency forward and option contracts are valued using standard valuation models. Interest rates,
forward market rates and volatility are used as inputs for such valuation techniques.
For natural gas contracts: Fair value is measured using the discounted difference between contractual rates and quoted market future
rates.
(b)
(c)
Fair value of the Company’s long-term debt is measured by comparison to market prices of its debt. The Company’s long-term debt is not carried at
fair value on the Consolidated Balance Sheets at December 31, 2021 and December 31, 2020. The carrying value of the Company’s long-term debt
due within one year is $259 million and $13 million at December 31, 2021 and December 31, 2020, respectively.
The carrying value of the Company’s long-term debt is $1,643 million and $1,079 million at December 31, 2021 and December 31, 2020,
respectively.
Due to their short-term maturity, the carrying amounts of cash and cash equivalents, receivables, bank indebtedness, trade and other payables and income
and other taxes approximate their fair values.
109
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 22.
SEGMENT DISCLOSURES
Following the sale of the Company’s Personal Care business on March 1, 2021, the Company now operates as a single reportable segment as described
below, which also represents its only operating segment:
•
Pulp and Paper – consists of the design, manufacturing, marketing and distribution of communication, specialty and packaging papers, as well as
softwood, hardwood and fluff pulp, and high quality airlaid and ultrathin laminated cores.
The accounting policies of the reportable segments are the same as those described in Note 1. The Company evaluates segment performance based on
operating income. Certain Corporate general and administrative costs are allocated to the segment. Corporate costs that are not related to segment activities,
as well as the mark-to-market impact on stock-based compensation awards, are presented on the Corporate line. The Company does not allocate interest
expense and income taxes to the segment. Segment assets are those directly used in segment operations.
The Company attributes sales to customers in different geographical areas on the basis of the location of the customer.
Long-lived assets consist of property, plant and equipment, operating lease right-of-use assets and intangible assets used in the generation of sales in the
different geographical areas.
110
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 22. SEGMENT DISCLOSURES (CONTINUED)
An analysis and reconciliation of the Company’s business segment information to the respective information in the financial statements is as follows:
SEGMENT DATA
Sales by product group
Communication papers
Specialty and packaging papers
Market pulp
Consolidated sales (1)
Operating income (loss) from continuing operations (2)
Pulp and Paper
Corporate
Consolidated operating income (loss) from continuing operations
Interest expense, net
Non-service components of net periodic benefit cost
(Loss) earnings before income taxes and equity loss
Income tax (benefit) expense
Equity method investment loss, net of taxes
(Loss) earnings from continuing operations
Earnings from discontinued operations, net of taxes
Net (loss) earnings
Successor
Period from
December 1,
through
December 31,
2021
$
Period from
January 1,
through
November 30,
2021
$
Predecessor
Year ended
December 31,
2020
$
Year ended
December 31,
2019
$
155
49
96
300
4
(3)
1
10
(2)
(7)
(2)
—
(5)
1
(4)
1,834
538
996
3,368
157
(168)
(11)
54
(22)
(43)
6
—
(49)
26
(23)
1,968
575
872
3,415
(153)
(34)
(187)
58
(17)
(228)
(80)
3
(151)
24
(127)
2,571
637
911
4,119
201
(47)
154
52
23
79
11
2
66
18
84
(1)
(2)
In 2021 and 2020, Staples, one of the Company’s largest customers, represented approximately 12% (2020 – 13%) of the total sales.
The Government of Canada created the Canada Emergency Wage Subsidy ("CEWS") to provide financial support for businesses during the
COVID-19 pandemic and prevent large layoffs. The Company recognized in the predecessor period $7 million as a reduction of costs (CDN
$9 million) ($6 million in Cost of sales (CDN $7 million) and $1 million in Selling, general and administrative (CDN $2 million)) related to
this program.
Segment assets
Pulp and Paper
Corporate
Total for reportable segments
Assets held for sale
Consolidated assets
111
Successor
Predecessor
December 31,
2021
$
December 31,
2020
$
4,051
516
4,567
287
4,854
3,012
515
3,527
1,329
4,856
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 22. SEGMENT DISCLOSURES (CONTINUED)
Additions to property, plant and equipment
Pulp and Paper
Corporate
Discontinued Operations
Consolidated additions to property, plant
and equipment
Add: Change in payables on capital projects
Consolidated additions to property, plant and
equipment per Consolidated Statements
of Cash Flows
Geographic information
Sales
United States
Canada
Asia
Europe
Other foreign countries
Long-lived assets
United States
Canada
Successor
Period from
December 1,
through
December 31,
2021
$
Period from
January 1,
through
November 30,
2021
$
Predecessor
Year ended
December 31,
2020
$
Year ended
December 31,
2019
$
42
—
1
43
(2)
251
4
15
270
(2)
120
3
37
160
15
208
3
53
264
(9)
41
268
175
255
Successor
Period from
December 1,
through
December 31,
2021
$
Period from
January 1,
through
November 30,
2021
$
Predecessor
Year ended
December 31,
2020
$
Year ended
December 31,
2019
$
232
27
26
13
2
300
2,560
327
315
157
9
3,368
2,691
324
203
116
81
3,415
3,219
419
207
149
125
4,119
Successor
Predecessor
December 31,
2021
$
December 31,
2020
$
2,069
710
2,779
1,423
585
2,008
112
DOMTAR CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
DECEMBER 31, 2021
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
NOTE 23.
RELATED PARTY TRANSACTIONS
Related party transactions with Paper Excellence and their affiliates were not material as of December 31, 2021 and for the period December 1 through
December 31, 2021.
113
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
The Company has nothing to report under this item.
ITEM 9A. CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in our reports
under the Securities and Exchange Act of 1934, as amended (“Exchange Act”), is recorded, processed, summarized and reported within the time periods
specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including our Chief Executive Officer
and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. As of December 31, 2021, an evaluation was
performed by members of management, at the direction and with the participation of our Chief Executive Officer and Chief Financial Officer, of the
effectiveness of the design and operation of our disclosure controls and procedures (as defined in Rule 13a-15(e) or 15d-15(e) under the Exchange Act).
Based upon this evaluation, our Chief Executive Officer and Chief Financial Officer concluded that, as at December 31, 2021, our disclosure controls and
procedures were effective.
Management’s Report on Internal Control over Financial Reporting
The information called for by this item is incorporated herein by reference to “Management’s Report on Internal Control Over Financial Reporting”.
Change in Internal Control over Financial Reporting
There were no changes in our internal control over financial reporting that have materially affected or are reasonably likely to materially affect our internal
control over financial reporting during the fourth quarter ended December 31, 2021.
ITEM 9B. OTHER INFORMATION
The Company has nothing to report under this item.
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
The information included under the captions “Governance of the Corporation” and “Directors” will be provided by incorporating the information required
by amendment to this Form 10-K annual report under cover of Form 10-K/A to be filed with the SEC no later than 120 days after the end of the fiscal year
covered by this Form 10-K annual report.
Information regarding our executive officers is presented in Item 1, Business, under the caption “Our Executive Officers”.
ITEM 11. EXECUTIVE COMPENSATION
Item 11 will be provided by incorporating the information required under such item by amendment to this Form 10-K annual report under cover of Form
10-K/A to be filed with the SEC no later than 120 days after the end of the fiscal year covered by this Form 10-K annual report.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS
Item 12 will be provided by incorporating the information required under such item by amendment to this Form 10-K annual report under cover of Form
10-K/A to be filed with the SEC no later than 120 days after the end of the fiscal year covered by this Form 10-K annual report.
114
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
Item 13 will be provided by incorporating the information required under such item by amendment to this Form 10-K annual report under cover of Form
10-K/A to be filed with the SEC no later than 120 days after the end of the fiscal year covered by this Form 10-K annual report.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
Item 14 will be provided by incorporating the information required under such item by amendment to this Form 10-K annual report under cover of Form
10-K/A to be filed with the SEC no later than 120 days after the end of the fiscal year covered by this Form 10-K annual report.
115
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
(a)
1. Financial Statements – See Item 8, Financial Statements and Supplementary Data.
2. Schedule II – Valuation and Qualifying Accounts
All other schedules are omitted as the information required is either included elsewhere in the consolidated financial statements in Item 8, Financial
Statements and Supplementary Data – or is not applicable.
3. Exhibits:
Exhibit
Number
Exhibit Description
Amendment No. 2 to the Securities Purchase Agreement among Domtar AI Inc, Domtar
Luxembourg Investments SARL, Domtar Corporation and Journey Personal Care Corp. dated
as of January 7, 2021
Incorporated by reference to:
Form
Exhibit
Filing Date
10-Q
2.1
08/05/2021
Agreement of Plan of Merger among Domtar Corporation, Karta Halten B.V., and Pearl
Merger Sub Inc. and Paper Excellence B.V. and Hervey Investments B.V. dated as of May 10,
2021
8-K
2.1
05/12/2021
Securities Purchase Agreement among Domtar AI Inc, Domtar Luxembourg Investments
SARL, Domtar Corporation and Journey Personal Care Corp. dated as of January 7, 2021
8-K
2.1
01/08/2021
Amended and Restated Certificate of Incorporation
Amended and Restated By-Laws
8-K
8-K
3.1
3.2
11/30/2021
11/30/2021
ABL Revolving Credit Agreement, dated as of November 30, 2021, by and among Pearl
Merger Sub Inc., Domtar Inc., Pearl Excellence Holdco L.P., and Barclays Bank PLC, as
Administrative Agent and Collateral Agent, and Barclay Bank PLC, Bank of Montreal and
Credit Suisse Loan Funding LLC, as the Lenders party thereto
First Lien Credit Agreement, dated as of November 30, 2021, by and among Pearl Merger
Sub Inc., Pearl Excellence Holdco L.P. and Barclays Bank PLC, as Administrative Agent and
Collateral Agent, Barclays Bank PLC, BMO Capital Markets Corp. and Credit Suisse Loan
Funding LLC as Lender party thereto
Indenture, dated as of October 18, 2021, among Pearl Merger Sub Inc. (to be merged with and
into Domtar Corporation), the guarantors party thereto, and the Bank of New York Mellon, as
trustee, providing for Domtar Corporation’s 6.75% Senior Secured Notes due 2028
Supplemental Indenture, dated as of November 30, 2021, among Domtar Corporation, the
guarantors party thereto, and The Bank of New York Mellon, as trustee, providing for Domtar
Corporation’s 6.75% Senior Secured Notes due 2028
Second Supplemental Indenture, dated as of December 30, 2021, among Domtar Corporation
and Domtar Delaware Holdings Inc., The Bank of New York Mellon, as trustee, providing for
Domtar Corporation’s 6.75% Senior Secured Notes due 2028
116
2.1
2.2
2.3
3.1
3.2
4.1
4.2
4.3
4.4
4.5
Exhibit
Number
Exhibit Description
Form
Exhibit
Filing Date
Incorporated by reference to:
4.6
4.7
4.8
10.1*
10.2*
10.3*
10.4*
10.5*
10.6*
10.7*
10.8*
21
24.1
31.1
31.2
32.1
32.2
Supplemental Indenture, dated December 30, 2021, among Domtar Delaware Holdings Inc.,
Domtar Corporation, The Bank of New York Mellon, as successor to The Bank of New York,
as trustee, relating to the guarantee by the new subsidiary guarantors of the obligations under
the Indenture
Supplemental Indenture, dated as of August 23, 2012, among Domtar Corporation, the
subsidiary guarantors party thereto, and The Bank of New York Mellon (formerly the Bank of
New York), as trustee, providing for Domtar Corporation’s 6.25% Notes due 2042
8-K
4.1
08/23/2012
Supplemental Indenture, dated as of November 26, 2013, among Domtar Corporation, the
subsidiary guarantors party thereto, and The Bank of New York Mellon (formerly the Bank of
New York), as trustee, providing for Domtar Corporation’s 6.75% Notes due 2044
8-K
4.1
11/26/2013
Amended and Restated Severance Program for Management Committee Members
10-K
10.6
03/01/2021
Amended and Restated DB SERP for Management Committee Members of Domtar
10-K
10.7
03/01/2021
Amended and Restated DC SERP for Designated Executives of Domtar
Form of Indemnification Agreement for members of Pension Administration Committee of
Domtar Corporation
10-K
10.8
02/25/2020
10-K
10.50
02/27/2009
Amended and Restated Supplementary Pension Plan for Designated Managers of Domtar Inc.
10-Q
10.3
08/04/2017
Amended and Restated Employment Agreement of Mr. John D. Williams
Amended and Restated Employment Agreement of Mr. Daniel Buron
Separation Agreement of employment with Domtar of Mr. Michael D. Garcia
10-K
10.16
03/01/2021
Subsidiaries of Domtar Corporation
Powers of Attorney (included in signature page)
Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002
Certification of the Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
Certification of the Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002
101.INS
XBRL Instance Document – the instance document does not appear in the Interactive Data
File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH
Inline XBRL Taxonomy Extension Schema
101.CAL
Inline XBRL Taxonomy Extension Calculation Linkbase
117
Exhibit
Number
Exhibit Description
Form
Exhibit
Filing Date
Incorporated by reference to:
101.DEF
Inline XBRL Taxonomy Extension Definition Linkbase
101.LAB
Inline XBRL Taxonomy Extension Label Linkbase
101.PRE
Inline XBRL Extension Presentation Linkbase
104
*
Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101)
Indicates management contract or compensatory arrangement
118
FINANCIAL STATEMENT SCHEDULE
(IN MILLIONS OF DOLLARS, UNLESS OTHERWISE NOTED)
SCHEDULE II – VALUATION AND QUALIFYING ACCOUNTS
For the periods ended:
Allowances deducted from related asset accounts:
Doubtful accounts - Accounts receivable
Balance at beginning of period
Charged to income
Deductions from reserve
Balance at end of period
Valuation Allowance on Deferred Tax Assets
Balance at beginning of period
Charged to income
Deductions from reserve
Balance at end of period
Successor
Period from
December 1,
through
December 31,
2021
$
Period from
January 1,
through
November 30,
2021
$
Predecessor
Year ended
December 31,
2020
$
Year ended
December 31,
2019
$
4
—
—
4
58
—
—
58
6
(2)
—
4
64
1
(7)
58
4
4
(2)
6
17
47
—
64
3
1
—
4
12
5
—
17
119
ITEM 16. FORM 10-K SUMMARY
None.
120
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized in the City of Fort Mill, South Carolina, United States, on March 10, 2022
SIGNATURES
DOMTAR CORPORATION
by
Name:
Title:
/s/ John D. Williams
John D. Williams
President and Chief Executive Officer
We, the undersigned directors and officers of Domtar Corporation, hereby severally constitute Nancy Klembus and Josée Mireault, and each of them singly,
our true and lawful attorneys with full power to them and each of them to sign for us, in our names in the capacities indicated below, any and all
amendments to this Annual Report on Form 10-K filed with the Securities and Exchange Commission.
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 registrant
and in the capacities and on the dates indicated.
Signature
/s/ John D. Williams
John D. Williams
/s/ Daniel Buron
Daniel Buron
/s/Patrick Loulou
Patrick Loulou
/s/ Tom Shih
Tom Shih
/s/ Hardi Wardhana
Hardi Wardhana
Title
Date
President and Chief Executive Officer (Principal
March 10, 2022
Executive Officer) and Director
Executive Vice President and Chief Financial
March 10, 2022
Officer (Principal Financial Officer and
Principal Accounting Officer)
Director
Director
Director
121
March 10, 2022
March 10, 2022
March 10, 2022
Exhibit 4.1
Execution Version
ABL REVOLVING CREDIT AGREEMENT
dated as of November 30, 2021
by and among
PEARL MERGER SUB INC.,
as the Initial Borrower,
DOMTAR INC.,
as a Co-Borrower,
as
PEARL EXCELLENCE HOLDCO L.P.,
as Holdings
BARCLAYS BANK PLC,
as Administrative Agent and Collateral Agent,
and
THE LENDERS PARTY HERETO
________________
BARCLAYS BANK PLC,
BANK OF MONTREAL,
CREDIT SUISSE LOAN FUNDING LLC,
and
WELLS FARGO BANK, NATIONAL ASSOCIATION
As Joint Lead Arrangers and Joint Bookrunners
TABLE OF “CONTENTS
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS
Page
Defined Terms2
Other Interpretive Provisions79
Accounting and Finance Terms; Accounting Periods; Unrestricted Subsidiaries; Determination of
Fair Market Value81
Rounding81
References to Agreements, Laws, Etc.81
Times of Day81
[Reserved]81
Pro Forma Calculations; Limited Condition Transactions; Basket and Ratio Compliance82
Currency Equivalents Generally85
Co-Borrowers86
ARTICLE II.
THE COMMITMENTS AND BORROWINGS
Revolving Loans87
Protective Advances89
Swing Line Loans90
Issuance of Letters of Credit and Purchase of Participations Therein93
Conversion/Continuation102
Availability103
Prepayments103
Termination or Reduction of Commitments106
Repayment of Loans107
Interest108
Fees109
Computation of Interest and Fees110
Evidence of Indebtedness111
Payments Generally111
Sharing of Payments, Etc.113
Incremental Borrowings113
[Reserved]115
Extensions of Loans115
Defaulting Lenders118
[Reserved]121
Judgment Currency121
Reserves; Changes to Eligibility Criteria121
Currency Equivalents122
ARTICLE III.
TAXES, INCREASED COSTS PROTECTION AND ILLEGALITY
Section 1.01
Section 1.02
Section 1.03
Section 1.04
Section 1.05
Section 1.06
Section 1.07
Section 1.08
Section 1.09
Section 1.10
Section 2.01
Section 2.02
Section 2.03
Section 2.04
Section 2.05
Section 2.06
Section 2.07
Section 2.08
Section 2.09
Section 2.10
Section 2.11
Section 2.12
Section 2.13
Section 2.14
Section 2.15
Section 2.16
Section 2.17
Section 2.18
Section 2.19
Section 2.20
Section 2.21
Section 2.22
Section 2.23
Section 3.01
Taxes123
-ii-
Section 3.02
Section 3.03
Section 3.04
Section 3.05
Section 3.06
Section 3.07
Section 3.08
Illegality127
Inability to Determine Rates128
Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurocurrency Rate Loans129
Funding Losses130
Matters Applicable to All Requests for Compensation131
Replacement of Lenders Under Certain Circumstances132
Survival133
ARTICLE IV.
CONDITIONS PRECEDENT TO BORROWINGS
Section 4.01
Section 4.02
Conditions to Initial Borrowing133
Conditions to All Borrowings After the Closing Date137
Section 5.01
Section 5.02
Section 5.03
Section 5.04
Section 5.05
Section 5.06
Section 5.07
Section 5.08
Section 5.09
Section 5.10
Section 5.11
Section 5.12
Section 5.13
Section 5.14
Section 5.15
Section 5.16
Section 5.17
Section 5.18
Section 5.19
Section 5.20
Section 6.01
Section 6.02
Section 6.03
Section 6.04
Section 6.05
Section 6.06
Section 6.07
Section 6.08
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
Existence, Qualification and Power; Compliance with Laws138
Authorization; No Contravention138
Governmental Authorization138
Binding Effect139
Financial Statements; No Material Adverse Effect139
Litigation139
Labor Matters139
Ownership of Property; Liens; Insurance140
Environmental Matters140
Taxes140
ERISA Compliance140
Subsidiaries141
Margin Regulations; Investment Company Act141
Disclosure141
Intellectual Property; Licenses, Etc.142
Solvency142
USA PATRIOT Act, FCPA and OFAC142
Collateral Documents143
Use of Proceeds143
Borrowing Base Certificate143
ARTICLE VI.
AFFIRMATIVE COVENANTS
Financial Statements143
Certificates; Other Information145
Notices147
Payment of Certain Taxes148
Preservation of Existence, Etc.148
Maintenance of Properties148
Maintenance of Insurance148
Compliance with Laws149
-iii-
Section 6.09
Section 6.10
Section 6.11
Section 6.12
Section 6.13
Section 6.14
Section 6.15
Section 6.16
Section 6.17
Section 6.18
Section 6.19
Section 7.01
Section 7.02
Section 7.03
Section 7.04
Section 7.05
Section 7.06
Section 7.07
Section 7.08
Section 7.09
Section 7.10
Section 7.11
Section 7.12
Books and Records149
Inspection Rights149
Covenant to Guarantee Obligations and Give Security150
Further Assurances151
Designation of Subsidiaries153
[Reserved]153
Post-Closing Matters153
Use of Proceeds153
Change in Nature of Business154
[Reserved]154
Cash Receipts.154
ARTICLE VII.
NEGATIVE COVENANTS
Liens156
Investments162
Indebtedness166
Fundamental Changes169
Dispositions172
Restricted Payments174
Transactions with Affiliates178
Negative Pledge180
Junior Debt Prepayments; Amendments to Junior Financing Documents182
Passive Holding Company184
Changes in Fiscal Year186
Canadian Pension Plans186
ARTICLE VIII.
ARTICLE VIII. FINANCIAL COVENANT
Section 8.01
Section 8.02
Fixed Charge Coverage Ratio186
Borrower’s Right to Cure186
ARTICLE IX.
EVENTS OF DEFAULT AND REMEDIES
Section 9.01
Section 9.02
Section 9.03
Events of Default187
Remedies upon Event of Default189
Application of Funds190
ARTICLE X.
ADMINISTRATIVE AGENT AND OTHER AGENTS
Section 10.01
Section 10.02
Section 10.03
Appointment and Authority of the Administrative Agent192
Rights as a Lender193
Exculpatory Provisions193
-iv-
Section 10.04
Section 10.05
Section 10.06
Section 10.07
Section 10.08
Section 10.09
Section 10.10
Section 10.11
Section 10.12
Section 10.13
Section 10.14
Section 10.15
Section 10.16
Section 11.01
Section 11.02
Section 11.03
Section 11.04
Section 11.05
Section 11.06
Section 11.07
Section 11.08
Section 11.09
Section 11.10
Section 11.11
Section 11.12
Section 11.13
Section 11.14
Section 11.15
Section 11.16
Section 11.17
Section 11.18
Section 11.19
Section 11.20
Section 11.21
Section 11.22
Section 11.23
Section 11.24
Section 11.25
Section 11.26
Section 11.27
Section 11.28
Reliance by the Agents195
Delegation of Duties195
Non-Reliance on Agents and Other Lenders; Disclosure of Information by Agents196
Indemnification of Agents197
No Other Duties; Other Agents, Lead Arranger, Managers, Etc.198
Resignation of Administrative Agent or Collateral Agent198
Administrative Agent May File Proofs of Claim; Credit Bidding199
Collateral and Guaranty Matters200
Appointment of Supplemental Administrative Agents204
Intercreditor Agreements205
Secured Cash Management Agreements and Secured Hedge Agreements205
Withholding Taxes206
Certain ERISA Matters206
ARTICLE XI.
MISCELLANEOUS
Amendments, Waivers, Etc.207
Notices and Other Communications; Facsimile Copies211
No Waiver; Cumulative Remedies214
Attorney Costs and Expenses214
Indemnification by the Borrower215
Marshaling; Payments Set Aside217
Successors and Assigns217
Confidentiality222
Set-off224
Interest Rate Limitation224
Counterparts; Integration; Effectiveness225
Electronic Execution of Assignments and Certain Other Documents225
Survival225
Severability226
GOVERNING LAW226
WAIVER OF RIGHT TO TRIAL BY JURY227
Limitation of Liability228
Use of Name, Logo, Etc.228
USA PATRIOT Act Notice.228
Service of Process229
No Advisory or Fiduciary Responsibility229
Binding Effect229
Obligations Several; Independent Nature of Lender’s Rights229
Headings230
Acknowledgement and Consent to Bail-In of Affected Financial Institutions230
Acknowledgment Regarding Any Supported QFCs230
Disqualified Lenders231
Erroneous Payments233
SCHEDULES
-v-
2.01
2.04
5.06
5.07
5.11(a)
5.11(b)
5.11(c)
5.12
6.15
6.19
11.02
EXHIBITS
Form of
A-1
A-2
A-3
A-4
B-1
B-2
B-3
C
D
E
F
G
H
I
J
K
Commitments
Existing Letters of Credit
Litigation
Labor Matters
ERISA Compliance
ERISA Compliance
Canadian Benefit Plans
Subsidiaries
Post-Closing Matters
Cash Receipts
Administrative Agent’s Office, Certain Addresses for Notices
Committed Loan Notice
Issuance Notice
Conversion/Continuation Notice
Swing Line Notice
Tranche 1 Revolving Loan Note
Tranche 2 Revolving Loan Note
Swing Line Note
Compliance Certificate
Assignment and Assumption
Guaranty
Security Agreement
Non-Bank Certificate
Global Intercompany Note
Solvency Certificate
Prepayment Notice
Borrowing Base Certificate
-vi-
ABL REVOLVING CREDIT AGREEMENT
This ABL REVOLVING CREDIT AGREEMENT is entered into as of November 30, 2021, by and among PEARL MERGER
SUB INC., a Delaware corporation (“Merger Sub” and the “Initial Borrower”), PEARL EXCELLENCE HOLDCO L.P., a Delaware
limited partnership (“Holdings”), DOMTAR INC., a corporation organized under the federal laws of Canada, as, upon the consummation of
the Acquisition, a Co-Borrower, BARCLAYS BANK PLC, as administrative agent under the Loan Documents (in such capacity, including
any successor thereto, the “Administrative Agent”), BARCLAYS BANK PLC, as collateral agent under the Loan Documents (in such
capacity, including any successor thereto, the “Collateral Agent”), each Issuing Bank from time to time party hereto, BARCLAYS BANK
PLC (“Barclays”), BANK OF MONTREAL (“BMO”), CREDIT SUISSE LOAN FUNDING LLC (“CS”) and WELLS FARGO BANK,
NATIONAL ASSOCIATION (“WF”), as joint lead arrangers and joint bookrunners (the “Lead Arrangers”), and each lender from time to
time party hereto (collectively, the “Lenders” and, individually, a “Lender”). Capitalized terms used herein are defined as set forth in
Section 1.01.
PRELIMINARY STATEMENTS
Pursuant to the Acquisition Agreement (as this and other capitalized terms used in these preliminary statements are defined in
Section 1.01 below), Merger Sub will merge with and into (the “Merger”) Domtar Corporation, a Delaware corporation (the “Company”
and together with its subsidiaries, the “Acquired Business”), with the Company surviving as successor Borrower (the “Acquisition”).
The Borrower and each Co-Borrower have requested that from time to time (including on the Closing Date substantially
simultaneously with the consummation of the Acquisition and upon satisfaction (or waiver) of the conditions precedent set forth in Article IV
below), the Tranche 1 Revolving Lenders make Tranche 1 Revolving Loans, the Tranche 2 Revolving Lenders make Tranche 2 Revolving
Loans the Swing Line Lender to make Swing Line Loans and the Issuing Banks issue Letters of Credit, pursuant to the terms of this
Agreement.
On the Closing Date, the Initial Borrower intends to enter into the Term Loan Credit Agreement pursuant to which the Term Loan
Lenders will extend credit to the Borrower in the form of Initial Term Loans in an aggregate principal amount of $525,000,000 and delayed
draw term loans in an aggregate principal amount of up to $250,000,000.
On October 18, 2021, the Initial Borrower, as “issuer”, entered into the Senior Secured Notes Indenture pursuant to which the
Initial Borrower issued the Senior Secured Notes in an initial aggregate principal amount of $775,000,000.
On or prior to the Closing Date, Jackson Wijaya, Company Persons and other equity investors will, directly or indirectly make the
Equity Contribution in accordance with and subject to the terms of the Acquisition Agreement.
On the Closing Date, the Initial Borrower will repay (or cause to be repaid) all outstanding Indebtedness (the “Existing
Indebtedness”) under, terminate any commitments under, and cause to be released any contractual Liens securing obligations under the
Existing Credit Documents (such repayment, repurchase termination and release, collectively, the “Closing Date Refinancing”).
The proceeds of the borrowings hereunder permitted on the Closing Date, together with the proceeds of the Initial Term Loans, the
Senior Secured Notes, the Equity Contribution and cash on hand at
1
the Borrower and its Subsidiaries will be used to finance the Transactions, for working capital purposes and to finance transactions not
prohibited by this Agreement.
The applicable Lenders have indicated their willingness to lend, and each Issuing Bank has indicated its willingness to issue
Letters of Credit, in each case on the terms and subject to the conditions set forth herein.
In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01
Defined Terms
. As used in this Agreement, the following terms have the meanings set forth below:
“ABL Priority Collateral” means the “ABL Collateral” as defined in the Closing Date ABL Intercreditor Agreement.
“Account” has the meaning assigned to such term in the Security Agreement or the Canadian Security Agreement, as applicable.
“Account Debtor” means any Person obligated on an Account.
“Accounts Receivable Component” means (i) the face amount of Eligible Accounts Receivable of the Account Debtors for
which have an Investment Grade Rating multiplied by 90.0%; (ii) the face amount of Eligible Credit Insured Accounts multiplied by 90.0%;
(iii) the face amount of Eligible Accounts Receivable the Account Debtors for which do not have an Investment Grade Rating multiplied by
85.0%.
“Acquired Borrowing Base” has the meaning specified in the definition of “Eligible Accounts Receivable”.
“Acquired Business” has the meaning specified in the preliminary statements to this Agreement.
“Acquisition” has the meaning specified in the preliminary statements to this Agreement.
“Acquisition Agreement” means the Agreement and Plan of Merger, dated as of May 10, 2021, among Merger Sub, Paper
Excellence B.V., the Company, and the other parties thereto, as amended, restated, modified or supplemented from time to time in accordance
with the terms of the Commitment Letter.
“Acquisition Agreement Representations” means such of the representations and warranties made by the Acquired Business
with respect to the Acquired Business in the Acquisition Agreement to the extent a breach of such representations and warranties is material
and adverse to the interests of the Lenders (in their capacities as such).
“Acquisition Transaction” means the purchase or other acquisition (in one transaction or a series of transactions, including by
merger, amalgamation or otherwise) by the Borrower or any Restricted Subsidiary of all or substantially all the property, assets or business of
another Person, or assets constituting a business unit, line of business or division of, any Person, or of a majority of the outstanding Equity
Interests of any Person (including any Investment which serves to increase the Borrower’s or any Restricted
2
Subsidiary’s respective equity ownership in any Joint Venture or other Person to an amount in excess (or further in excess) of the majority of
the outstanding Equity Interests of such Joint Venture or other Person).
“Additional Lender” means, at any time, any bank, other financial institution or institutional investor that, in any case, is not an
existing Lender and that agrees to provide any portion of any,
(a)
Incremental Loan in accordance with Section 2.16;
provided that each Additional Lender (other than any Person that is a Lender, an Affiliate or branch of a Lender or an Approved Fund of a
Lender at such time) shall be subject to the approval of the Administrative Agent, the Swing Line Lender and/or the Issuing Banks (such
approval not to be unreasonably withheld, conditioned or delayed), in each case to the extent any such consent would be required from the
Administrative Agent, the Swing Line Lender and/or the Issuing Banks under Section 11.07(b)(iii)(B), (C), and/or (D), respectively, for an
assignment of Loans to such Additional Lender.
“Adjusted Eurocurrency Rate” means, with respect to any Borrowing of Eurocurrency Rate Loans for any Interest Period, an
interest rate per annum equal to, (x) with respect to Eurocurrency Rate Loans denominated in Dollars, the Eurocurrency Rate based on clause
(a) of the definition of “Eurocurrency Rate” for such Interest Period multiplied by the Statutory Reserve Rate and (y) with respect to
Eurocurrency Rate Loans denominated in Canadian Dollars, the Eurocurrency Rate based on clause (b) of the definition of “Eurocurrency
Rate” for such Interest Period multiplied by the Statutory Reserve Rate; provided that, notwithstanding the foregoing, the “Adjusted
Eurocurrency Rate” shall in no event be less than 0.00% per annum. The Adjusted Eurocurrency Rate with respect to Eurocurrency Rate
Loans denominated in Dollars will be adjusted automatically as to all Borrowings of Eurocurrency Rate Loans based on clause (a) of the
definition of “Eurocurrency Rate” then outstanding as of the effective date of any change in the Statutory Reserve Rate.
“Adjustment Date” means the first day of each January, April, July and October, as applicable.
“Administrative Agent” has the meaning specified in the introductory paragraph to this Agreement.
“Administrative Agent Account” has the meaning specified in Section 6.19(c).
“Administrative Agent’s Office” means the Administrative Agent’s address and, as appropriate, account as set forth on
Schedule 11.02, or such other address or account as the Administrative Agent may from time to time notify the Borrower and the Lenders.
“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.
“Affected Financial Institution” means (a) any EEA Financial Institution, or (b) any UK Financial Institution.
“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. “Controlled” has the meaning correlative thereto. For the avoidance of doubt, none of the Lead Arrangers, the
Agents or their respective lending affiliates shall be deemed to be an Affiliate of the Loan Parties or any of the Restricted Subsidiaries.
3
“Agent Parties” has the meaning specified in Section 11.02(e).
“Agent-Related Persons” means the Agents, together with their respective Affiliates and branches, and the officers, directors,
shareholders, employees, agents, attorney-in-fact, partners, trustees, advisors and other representatives of such Persons and of such Persons’
Affiliates and branches.
“Agents” means, collectively, the Administrative Agent, the Collateral Agent, the Joint Bookrunners, the Supplemental
Administrative Agents (if any) and the Lead Arrangers.
“Aggregate Commitments” means the Commitments of all the Lenders.
“Agreed Currencies” means Dollars and Canadian Dollars.
“Agreement” means this Credit Agreement, as amended, restated, amended and restated, modified or supplemented from time to
time in accordance with the terms hereof.
“Agreement Currency” has the meaning specified in Section 2.21(b).
“AHYDO Catch Up Payment” has the meaning specified in Section 7.09(a)(viii).
“Alternative Currencies” means (a) Canadian Dollars and (b) any other currency agreed to by the Administrative Agent, the
Borrower and each Revolving Lender providing such Revolving Loans, Incremental Revolving Facilities or Extended Revolving Loans;
provided that, in the case of clause (b) of this definition, each such other currency is a lawful currency that is readily available, freely
transferable and not restricted, able to be converted into Dollars and available in the London interbank deposit market or other applicable
offshore interbank market.
“Annual Financial Statements” means the audited consolidated balance sheets of the Company as of December 31, 2020, and
the related consolidated statements of operations, changes in stockholders’ equity and cash flows for the Company for the fiscal year then
ended.
“Applicable Commitment Fee” means a percentage per annum that shall be equal to,
(a)
for each day from the Closing Date until the last day of the first full fiscal quarter completed after the Closing
Date, 0.375% per annum, and
(b)
thereafter, for each Fiscal Quarter or portion thereof, the applicable rate per annum set forth below under the
caption “Applicable Commitment Fee” based upon the Average Usage for the preceding Fiscal Quarter then-ended:
Category
Category 1
Category 2
Average Usage
Less than 50%
Greater than or equal to 50%
Applicable
Commitment Fee
0.375%
0.25%
provided that the Applicable Commitment Fee shall be adjusted quarterly on a prospective basis on each Adjustment Date based upon the
Average Usage in accordance with the table above.
“Applicable Creditor” has the meaning specified in Section 2.21(b).
4
“Applicable Decimal Place” has the meaning specified in Section 1.04.
“Applicable Indebtedness” has the meaning specified in the definition of “Weighted Average Life to Maturity.”
“Applicable Rate” means:
the Closing Date, a percentage per annum equal to, (i) for Eurocurrency Rate Loans, 1.75% and (ii) for Base Rate Loans, 0.75%;
(a)
for any day from the Closing Date until the last day of the first full fiscal quarter completed after
thereafter, for any day, the applicable rate per annum set forth below under the caption “Base Rate
Spread” or “Adjusted Eurocurrency Rate Spread”, respectively, based upon the Average Historical Excess Availability of the
Borrower and Co-Borrowers as of the most recent Adjustment Date prior to such day, expressed as a percentage of the Line Cap:
(b)
Category
Category 1
Category 2
Average Historical Excess Availability
as a Percentage of the Line Cap
Adjusted Eurocurrency
Rate Spread
Base
Rate Spread
Above or equal to 66 2/3%
Less than 66 2/3% and above or equal
to 33 1/3%
1.50%
1.75%
2.00%
0.50%
0.75%
1.00%
Category 3
Less than 33 1/3%
The Applicable Rate shall be adjusted quarterly on a prospective basis on each Adjustment Date based upon the Average
Historical Excess Availability in accordance with the table above; provided that if a Borrowing Base Certificate is not delivered when
required pursuant to Section 6.02(d), the “Applicable Rate” shall be the applicable rate per annum set forth above in Category 3 until a
Borrowing Base Certificate is delivered in compliance with Section 6.02(f).
“Appropriate Lender” means, at any time, with respect to Loans of any Class, the Lenders of such Class.
“Approved Fund” means, with respect to any Lender, any Fund that is administered, advised or managed by (a) such Lender,
(b) an Affiliate or branch of such Lender or (c) an entity or an Affiliate of an entity that administers, advises or manages such Lender.
“Assignment and Assumption” means an Assignment and Assumption substantially in the form of Exhibit D or any other form
approved by the Administrative Agent.
“Attorney Costs” means all reasonable and documented in reasonable detail fees, expenses, charges and disbursements of any law
firm or other external legal counsel.
“Attributable Indebtedness” means, on any date, in respect of any Capitalized Lease of any Person, the capitalized amount
thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP.
5
“Auto-Renewal Letter of Credit” has the meaning specified in Section 2.04(b)(iii).
“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if the
then-current Benchmark is a term rate, any tenor for such Benchmark that is or may be used for determining the length of an Interest Period
or (y) otherwise, any payment period for interest calculated with reference to such Benchmark, as applicable, pursuant to this Agreement as
of such date.
“Average Historical Excess Availability” means, at any Adjustment Date, the quotient, expressed as a percentage obtained by
dividing (a) the average daily Specified Excess Availability for the Fiscal Quarter immediately preceding such Adjustment Date (with the
Borrowing Base at such time for any such day used to determine “Specified Excess Availability”, calculated by reference to the most recent
Borrowing Base Certificate delivered to the Administrative Agent on or prior to such day pursuant to Section 6.02(f)) by (b) the average
daily Line Cap for such Fiscal Quarter.
“Average Usage” shall mean, at any Adjustment Date, the average utilization of Revolving Commitments of a Class (expressed as
a percentage) for the fiscal quarter immediately preceding such Adjustment Date.
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in
respect of any liability of an Affected Financial Institution.
“Bail-In Legislation” means, (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of
the European Parliament and of the Council of the European Union, the implementing law, rule, regulation or requirement for such EEA
Member Country from time to time which is described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom,
Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the
United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other
than through liquidation, administration or other insolvency proceedings).
“Bank Products Reserves” means all reserves established by the Administrative Agent in its Permitted Discretion for Cash
Management Obligations and Secured Hedge Agreements then outstanding, which amount may be increased with respect to any existing
Cash Management Obligation and Secured Hedge Agreement by further written notice from such Cash Management Bank or Hedge Bank to
the Administrative Agent from time to time in the manner provided in the definition of Reserved Secured Cash Management Obligations or
Reserved Secured Hedge Obligations, as applicable.
“Bankruptcy Code” shall mean Title 11 of the United States Code (11 U.S.C. § 101, et seq.), as amended from time to time.
“Barclays” has the meaning specified in the introductory paragraph to this Agreement.
“Base Rate” means for any day a fluctuating rate per annum equal to:
(1) with respect to Loans denominated in Dollars, the highest of (a) the Federal Funds Rate plus 0.50%, (b) the rate of interest last
quoted by the Wall Street Journal as the “prime rate” in the United States, and (c) the Adjusted Eurocurrency Rate for Loans denominated in
Dollars on such day for an Interest Period of one month plus 1.00% (or, if such day is not a Business Day, the immediately preceding
Business Day); provided that, notwithstanding the foregoing, the “Base Rate” shall in no event be less than 1.00% per annum. The “prime
rate” is a rate set by the Administrative Agent based upon various factors including
6
the Administrative Agent’s costs and desired return, general economic conditions and other factors, and is used as a reference point for
pricing some loans, which may be priced at, above, or below such announced rate.Any change in such prime rate announced by the
Administrative Agent shall take effect at the opening of business on the day specified in the public announcement of such change.
(2) with respect to Loans denominated in Canadian Dollars, the highest of (a) the last publicly announced rate of interest by Royal
Bank of Canada, Bank of Montreal or The Toronto-Dominion Bank as its respective reference rate in effect on such day at its respective
principal office in Toronto for determining interest rates applicable to commercial loans denominated in Canadian Dollars or, if such
institutions cease to publicly announce or quote such rate, the rate which a Schedule I chartered bank under the Bank Act (Canada) selected
by the Administrative Agent, at such bank’s principal office in Canada, then quotes, publishes and refers to as its “prime rate” and which is
the reference rate of interest for loans in Canadian Dollars made in Canada to commercial borrowers, and (b) the Adjusted Eurocurrency Rate
for Loans denominated in Canadian Dollars on such day for a term of one month plus 1.00% (or, if such day is not a Business Day, the
immediately preceding Business Day); provided that, notwithstanding the foregoing, the “Base Rate” shall in no event be less than 1.00% per
annum. Each change in the Base Rate applicable to any Borrowing in Canadian Dollars shall be effective from and including the date such
change is publicly announced as being effective or is so quoted, as applicable.
“Base Rate Loan” means a Loan denominated in Dollars or Canadian Dollars that bears interest based on the Base Rate.
“Benchmark” means, initially, the Relevant Rate for such Agreed Currency; provided that if a replacement of the Benchmark has
occurred pursuant to Section 11.01(f) titled “Benchmark Replacement Setting”, then “Benchmark” means the applicable Benchmark
Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate. Any reference to “Benchmark” shall
include, as applicable, the published component used in the calculation thereof.
“Benchmark Replacement” means, for any Available Tenor:
(1) For purposes of Section 11.01(f)(i)(A), the first alternative set forth below that can be determined by the Administrative Agent:
(a) the sum of: (i) Term SOFR and (ii) 0.11448% (11.448 basis points) for an Available Tenor of one-month’s duration,
0.26161% (26.161 basis points) for an Available Tenor of three-months’ duration, and 0.42826% (42.826 basis points) for an
Available Tenor of six-months’ duration, or
(b) the sum of: (i) Daily Simple SOFR and (ii) the spread adjustment selected or recommended by the Relevant
Governmental Body for the replacement of the tenor of USD LIBOR with a SOFR-based rate having approximately the same
length as the interest payment period specified in clause (a) of this definition; and
(2) For purposes of Section 11.01(f)(i)(B), the sum of (a) the alternate benchmark rate and (b) an adjustment (which may be a
positive or negative value or zero), in each case, that has been selected by the Administrative Agent and the Borrower as the replacement for
such Available Tenor of such Benchmark giving due consideration to any evolving or then-prevailing market convention, including any
applicable recommendations made by the Relevant Governmental Body, for U.S. dollar-denominated syndicated credit facilities at such time;
7
provided that, if the Benchmark Replacement as determined pursuant to clause (1) or (2) above would be less than the Floor, the Benchmark
Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents.
“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical,
administrative or operational changes (including changes to the definition of “ABR,” the definition of “Business Day,” the definition of
“Interest Period,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment,
conversion or continuation notices, the applicability and length of lookback periods, the applicability of breakage provisions, and other
technical, administrative or operational matters) that the Administrative Agent decides may be appropriate to reflect the adoption and
implementation of such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner
substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is
not administratively feasible or if the Administrative Agent determines that no market practice for the administration of such Benchmark
Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with
the administration of this Agreement and the other Loan Documents).
“Benchmark Transition Event” means, with respect to any then-current Benchmark other than USD LIBOR, the occurrence of a
public statement or publication of information by or on behalf of the administrator of the then-current Benchmark, the regulatory supervisor
for the administrator of such Benchmark, the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, an
insolvency official with jurisdiction over the administrator for such Benchmark, a resolution authority with jurisdiction over the administrator
for such Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark,
announcing or stating that (a) such administrator has ceased or will cease on a specified date to provide all Available Tenors of such
Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that
will continue to provide any Available Tenor of such Benchmark or (b) all Available Tenors of such Benchmark are or will no longer be
representative of the underlying market and economic reality that such Benchmark is intended to measure and that representativeness will not
be restored.
“Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial
Ownership Regulation.
“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.
“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan”
as defined in and subject to Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or
otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.
“BHC Act Affiliate” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C.
1841(k)) of such party.
“Blocked Account Agreement” has the meaning specified in Section 6.19(b).
“Blocked Accounts” has the meaning specified in Section 6.19(b).
“BMO” has the meaning specified in the introductory paragraph to this Agreement.
8
“Board of Directors” means, as to any Person, the board of directors, board of managers or other governing body of such Person,
or if such Person is owned or managed by a single entity, the board of directors, board of managers or other governing body of such entity,
and the term “directors” means members of the Board of Directors.
“Borrower” means, (i) immediately prior to the consummation of the Merger, the Initial Borrower, (ii) immediately after the
consummation of the Merger, the Company, together with their successors and assigns permitted hereunder.
“Borrower Materials” has the meaning specified in Section 6.02.
“Borrowing” means a borrowing consisting of Loans of the same Class and Type made, converted or continued on the same date
and, in the case of Eurocurrency Rate Loans, having the same Interest Period.
“Borrowing Base” means, at any time, an amount equal to (a) the Accounts Receivable Component, plus (b) the Inventory
Component, plus (c) the Qualified Cash Component, minus (d) the amount of all Reserves in effect as of such date of determination, as the
same may at any time and from time to time be established in accordance with Section 2.22; provided that the Qualified Cash Component
shall not exceed 15.0% of the Borrowing Base. The Borrowing Base at any time shall be determined by reference to the most recent
Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 6.02(d) and Reserves established pursuant to Section
2.22; provided, further, that the inclusion in the Borrowing Base of any assets or other property acquired in connection with a transaction
described in Section 6.11(a) shall be subject to the Borrower’s compliance with Section 6.11(a) within the time periods set forth therein.
“Borrowing Base Certificate” means a certificate from the senior vice president (finance), chief financial officer, treasurer,
manager of treasury activities or assistant treasurer or other officer with equivalent duties of the Borrower in substantially the form of
Exhibit K, as such form, subject to the terms hereof, may from time to time be modified as agreed by the Borrower and the Administrative
Agent or such other form which is acceptable to the Administrative Agent in its reasonable discretion, and with such changes therein as may
be required by the Administrative Agent in its Permitted Discretion to reflect the components of and Reserves against the Borrowing Base as
provided for hereunder from time to time, together with appropriate exhibits, schedules, supporting documentation and additional reports as
reasonably requested by the Administrative Agent.
“Business Day” means (a) any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close
under the Laws of, or are in fact closed in, the jurisdiction where the Administrative Agent’s Office is located (which, as of the date of this
Agreement, is New York, New York) and if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in
Dollars, any fundings, disbursements, settlements and payments in respect of any such Eurocurrency Rate Loan, or any other dealings to be
carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan, means any such day on which dealings in deposits in
Dollars are conducted by and between banks in the London interbank eurodollar market, and (b) if such day relates to any interest rate
settings as to a Eurocurrency Rate Loan or Letter of Credit denominated in an Alternative Currency (other than Canadian Dollars), any
fundings, settlements, payments and disbursements in such Alternative Currency, or any other dealings in such Alternative Currency to be
carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan or Letter of Credit, means any such day described in
clause (a) above which is also a day on which dealings in deposits in such Alternative Currency are conducted by and between banks in the
London interbank market and (other than any date that relates to any interest rate setting in respect of such Alternative Currency) any such
day on which banks are open for foreign exchange business in the principal financial center of the country of such Alternative Currency; and
(c) if such date
9
relates to any interest rate settings as to a Loan denominated in Canadian Dollars, any day except Saturday, Sunday and any day which shall
be in Toronto, Ontario a statutory holiday or a day in which banking institutions are authorized or required by law or other government action
to close in Toronto, Ontario.
“Canadian Defined Benefit Pension Plan” means any Canadian Pension Plan which contains a “defined benefit provision,” as
defined in subsection 147.1(1) of the Canadian Tax Act.
“Canadian Dollars” and “C$” shall mean the lawful currency of Canada.
“Canadian Loan Party” means each Loan Party organized under the Laws of Canada or any province or territory thereof.
“Canadian Multi-Employer Pension Plan” means a multi-employer plan within the meaning of the regulations under the
Canadian Tax Act and applicable pension standards legislation in Canada to which a Loan Party contributes for its employees or former
employees employed in Canada.
“Canadian Pension Plan” means a “registered pension plan”, as such term is defined in subsection 248(1) of the Canadian Tax
Act, which is or was sponsored, administered or contributed to, or required to be contributed to, by Holdings or any of its subsidiaries
(including, for greater certainty, Domtar Inc. or any of its subsidiaries and any other Loan Party or any of its subsidiaries) for its employees
or former employees in Canada, but does not include any Canadian Multi-Employer Pension Plan, the Canada Pension Plan or the Quebec
Pension Plan, as maintained by the Government of Canada or the Province of Quebec, respectively.
“Canadian Pension Plan Event” means (a) a contribution or premium required to be paid to or in respect of any Canadian
Defined Benefit Pension Plan or Canadian Multi-Employer Pension Plan not having been paid in a timely fashion in accordance with the
terms thereof and all applicable law, or any taxes, penalties or fees owing or exigible under any Canadian Defined Benefit Pension Plan or
Canadian Multi-Employer Pension Plan beyond the date permitted for payment of same; (b) the winding-up or termination of a Canadian
Defined Benefit Pension Plan or the occurrence of an event respecting any Canadian Defined Benefit Pension Plan which would entitle or
could reasonably be expected to entitle any Person to wind-up or terminate any Canadian Defined Benefit Pension Plan, or which could
reasonably be expected to adversely affect the tax status thereof; (c) any statutory deemed trust or Lien arises in respect of a Canadian
Defined Benefit Pension Plan or Canadian Multi-Employer Pension Plan; (d) the withdrawal from a Canadian Multi-Employer Pension Plan
or similar plan under applicable federal or provincial pension benefits or standards legislation in Canada where contribution obligations arise
as a result of the withdrawal; or (e) the occurrence of an improper withdrawal or transfer of assets from any Canadian Defined Benefit
Pension Plan or Canadian Multi-Employer Pension Plan.
“Canadian Priority Payables Reserve” shall mean, on any date of determination, reserves established by the Administrative
Agent in its Permitted Discretion which reflect amounts secured by any Liens, choate or inchoate, which rank or are capable of ranking in
priority to or pari passu with the Collateral Agent’s Liens, including amounts owing for wages, vacation pay, severance pay, employee
deductions, sales tax, excise tax, Tax payable pursuant to Part IX of the Excise Tax Act (Canada) (net of GST input credits), income tax,
workers compensation, government royalties, pension fund obligations including employee and employer pension plan contributions
(including “normal cost”, “special payments” and any other payments in respect of any funding deficiencies or shortfalls), overdue rents or
Taxes, and other statutory or other claims that have or may have priority over, or rank pari passu with, with the Collateral Agent’s Liens.
10
“Canadian Security Agreement” means, collectively, the ABL Canadian Security Agreement and each deed of hypothec
executed by the applicable Loan Parties, together with each Canadian Security Agreement Supplement executed and delivered pursuant to
Section 6.11.
“Canadian Security Agreement Supplement” has the meaning specified in the Canadian Security Agreement.
“Canadian Subsidiary” means any Subsidiary that is organized under the Laws of Canada or any province or territory thereof.
“Canadian Tax Act” means the Income Tax Act (Canada), and the regulations promulgated thereunder.
“Capitalized Lease Obligation” means, at the time any determination thereof is to be made, the amount of the liability in respect
of a Capitalized Lease that would at such time be required to be capitalized and reflected as a liability on a balance sheet (excluding the
footnotes thereto) prepared in accordance with GAAP.
“Capitalized Leases” means all capital or financing leases that have been or are required to be, in accordance with GAAP as in
effect on the Closing Date (including the Borrower’s adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842)),
recorded as capital or financing leases; provided that (i) for all purposes hereunder the amount of obligations under any Capitalized Lease
shall be the amount thereof accounted for as a liability in accordance with GAAP as in effect on the Closing Date (including the Borrower’s
adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842)) and (ii) in no event shall an operating lease or a lease
that would have been an operating lease prior to the adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) be
considered a Capitalized Lease.
“Captive Insurance Subsidiary” means any Subsidiary of the Borrower that is subject to regulation as an insurance company (or
any Subsidiary thereof).
“Cash Collateral Account” means an account held at, and subject to the sole dominion and control of, the Collateral Agent.
“Cash Collateralize” means, in respect of an Obligation, to provide and pledge (as a first priority perfected security interest) cash
collateral in Dollars, at a location and pursuant to documentation in form and substance satisfactory to the Administrative Agent, the Swing
Line Lender or an Issuing Bank, as applicable (and “Cash Collateralization” has a corresponding meaning). “Cash Collateral” shall have a
meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.
“Cash Dominion Period” means (a) each period beginning on the occurrence of a Specified ABL Event of Default until such
Specified ABL Event of Default has been cured or waived and (b) each period beginning on the date that Specified Excess Availability shall
have been less than the greater of (x) 10.0% of the Line Cap and (y) $35,000,000 for five consecutive Business Days and ending on the date
that Specified Excess Availability shall have been at least the greater of (x) 10.0% of the Line Cap and (y) $35,000,000 for 20 consecutive
calendar days (this clause (b), a “Liquidity Condition”). Notwithstanding anything to the contrary herein or in any other Loan Document,
the Credit Extensions made on the Closing Date shall not be deemed to give rise to a Liquidity Condition unless and until a Credit Extension
is made after the Closing Date and a Liquidity Condition subsequently occurs.
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“Cash Equivalents” means any of the following types of Investments (including for the avoidance of doubt, cash), to the extent
owned by the Borrower or any Restricted Subsidiary:
(a)
(b)
Dollars, Canadian Dollars, Euros and each Alternative Currency;
local currencies held by the Borrower or any Restricted Subsidiary from time to time in the ordinary course
of business and not for speculation;
(c)
readily marketable direct obligations issued or directly and fully and unconditionally guaranteed or insured
by the United States government, the Government of Canada or of any Canadian province, or any agency or instrumentality
thereof the securities of which are unconditionally guaranteed as a full faith and credit obligation of such government with
maturities of 12 months or less from the date of acquisition;
(d)
certificates of deposit, time deposits and eurodollar time deposits with maturities of one year or less from the
date of acquisition, demand deposits, bankers’ acceptances with maturities not exceeding one year and overnight bank deposits, in
each case with any domestic or foreign commercial bank having capital and surplus of not less than $500,000,000 (or the foreign
currency equivalent thereof as of the date of such investment);
(e)
repurchase obligations for underlying securities of the types described in clauses (c) and (d) above or
clause (h) below entered into with any financial institution meeting the qualifications specified in clause (d) above;
(f)
commercial paper rated at least P-2 by Moody’s or at least A-2 by S&P (or, if at any time neither Moody’s
nor S&P shall be rating such obligations, an equivalent rating from another nationally recognized statistical rating agency) and in
each case maturing within 12 months after the date of creation thereof;
(g)
marketable short-term money market and similar highly liquid funds having a rating of at least P-2 or A-2
from Moody’s or S&P, respectively (or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent
rating from another nationally recognized statistical rating agency);
(h)
readily marketable direct obligations issued by any state, commonwealth or territory of the United States, any
Canadian province or the Government of Canada, or any political subdivision or taxing authority thereof, in each case having an
Investment Grade Rating from either Moody’s or S&P (or, if at any time neither Moody’s nor S&P shall be rating such
obligations, an equivalent rating from another nationally recognized statistical rating agency) with maturities of 12 months or less
from the date of acquisition;
(i)
Investments with average maturities of 12 months or less from the date of acquisition in money market funds
rated AAA- (or the equivalent thereof) or better by S&P or Aaa3 (or the equivalent thereof) or better by Moody’s (or, if at any
time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from another nationally recognized statistical
rating agency);
(j)
through (i) above; and
investment funds investing substantially all of their assets in securities of the types described in clauses (a)
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(k)
solely with respect to any Captive Insurance Subsidiary, any investment that a Captive Insurance Subsidiary
is not prohibited to make in accordance with applicable Law.
In the case of Investments by any Foreign Subsidiary that is a Restricted Subsidiary or Investments made in a jurisdiction outside the United
States of America, Cash Equivalents shall also include (i) investments of the type and maturity described in clauses (a) through (k) above in
foreign obligors, which Investments or obligors (or the parents of such obligors) have ratings described in such clauses or equivalent ratings
from comparable foreign rating agencies and (ii) other short-term investments in accordance with normal investment practices for cash
management in investments analogous to the foregoing investments in clauses (a) through (k) above and in this paragraph. Notwithstanding
the foregoing, Cash Equivalents shall include amounts denominated in currencies other than those set forth in clause (a) or (b) above;
provided that such amounts, except amounts used to pay obligations of the Borrower or any Restricted Subsidiary denominated in any
currency other than Dollars or an Alternative Currency in the ordinary course of business, are converted into Dollars or an Alternative
Currency as promptly as practicable and in any event within ten Business Days following the receipt of such amounts.
“Cash Management Bank” means any Person that is a Lender or Agent or an Affiliate or branch of a Lender or Agent (a) on the
Closing Date (with respect to any Cash Management Services entered into prior to the Closing Date), (b) at the time it initially provides any
Cash Management Services to the Borrower or any Restricted Subsidiary, or (c) at the time that the Person to whom the Cash Management
Services are provided is merged or amalgamated with the Borrower or becomes or is merged or amalgamated with a Restricted Subsidiary
(with respect to any Cash Management Services entered into prior to the date of such merger or amalgamation or such Person becoming a
Restricted Subsidiary), in each case whether or not such Person subsequently ceases to be a Lender or Agent or an Affiliate or branch of a
Lender or Agent.
“Cash Management Obligations” means obligations owed by the Borrower or any Restricted Subsidiary to any Cash
Management Bank in respect of or in connection with any Cash Management Services and designated by the Cash Management Bank and
the Borrower in writing to the Administrative Agent as “Cash Management Obligations” (but only if such Cash Management Services have
not been designated as “Cash Management Obligations” under the Term Loan Credit Agreement).
“Cash Management Services” means any agreement or arrangement to provide cash management services, including treasury,
depository, overdraft, credit card processing, credit or debit card, purchase card, electronic funds transfer and other cash management
arrangements.
“Casualty Event” means any event that gives rise to the receipt by a Loan Party of any property or casualty insurance proceeds or
any condemnation or expropriation awards, in each case, in respect of any equipment, fixed assets or real property (including any
improvements thereon) to replace or repair such equipment, fixed assets or real property.
“CDOR Rate” shall mean, for the relevant Interest Period, the rate of interest per annum equal to the Canadian Dollar bankers’
acceptance rate, or comparable or successor rate approved by the Administrative Agent, determined by it at or about 10:15 a.m. (Toronto
time) on the applicable day (or the preceding Business Day, if the applicable day is not a Business Day) for a term comparable to the
Eurocurrency Rate Loan, as published on the CDOR or other applicable Reuters screen page (or other commercially available source
designated by the Administrative Agent from time to time); provided, (i) if such rate does not appear on the Reuters screen page on such day
as contemplated, then the CDOR Rate on such day shall be calculated as the rate for such period applicable to Canadian Dollar bankers’
acceptances quoted by the Administrative Agent (or as quoted on the appropriate page of such other information service that publishes such
rate from time to time, as selected by the Administrative Agent in its reasonable
13
discretion), at or about 10:15 a.m., on such day or, if such day is not a Business Day, then on the immediately preceding Business Day, and
(ii) that, notwithstanding the foregoing, the “CDOR Rate” shall in no event be less than 0.00% per annum.
“CFC” means a “controlled foreign corporation” within the meaning of Section 957(a) of the Code.
“Change in Law” means the occurrence, after the date of this Agreement, of any of the following:
(a)
the adoption or taking effect of any law, rule, regulation or treaty (excluding the taking effect after the date of
this Agreement of a law, rule, regulation or treaty adopted prior to the date of this Agreement),
(b)
any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof
by any Governmental Authority or
(c)
the making or issuance of any request, guideline or directive (whether or not having the force of law) by any
Governmental Authority.
It is understood and agreed that (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act (Pub. L. 111-203, H.R. 4173), all Laws
relating thereto, all interpretations and applications thereof and any compliance by a Lender with any and all requests, rules, guidelines,
requirements and directives thereunder or issued in connection therewith or in implementation thereof or relating thereto and (ii) all requests,
rules, guidelines, requirements or directives issued by any United States or foreign regulatory authority in connection with the
implementation of the recommendations of the Bank for International Settlements or the Basel Committee on Banking Regulations and
Supervisory Practices (or any successor or similar authority) in each case pursuant to Basel III, shall, for the purposes of this Agreement, be
deemed to be adopted subsequent to the date hereof and a Change in Law regardless of the date enacted, adopted, issued, promulgated or
implemented.
“Change of Control” means the earliest to occur of:
(a)
either:
(i)
at any time prior to the consummation of a Qualifying IPO, the Permitted Holders ceasing to
beneficially own (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), in the aggregate, directly or indirectly,
a majority of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests of
Holdings (or Successor Holdings, if applicable) or any Parent Entity; or
(ii)
any Person (other than a Permitted Holder) or Persons (other than one or more Permitted Holders)
constituting a “group” (as such term is used in Section 13(d) and Section 14(d) of the Exchange Act, but excluding any
employee benefit plan of such Person and its Subsidiaries, and any Person acting in its capacity as trustee, agent or
other fiduciary or administrator of any such plan), becoming the “beneficial owner” (as defined in Rules 13(d)-3 and
13(d)-5 under such Act), directly or indirectly, of Equity Interests representing more than forty percent (40%) of the
aggregate ordinary voting power represented by the then issued and outstanding Equity Interests of Holdings (or
Successor Holdings, if applicable) and the percentage of aggregate ordinary voting power so held is greater than the
percentage of the aggregate ordinary voting power represented by the Equity Interests of Holdings (or Successor
Holdings, if applicable) beneficially owned (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, in the aggregate by the
14
Permitted Holders, unless the Permitted Holders have, at such time, the right or the ability by voting power, contract or
otherwise to elect or designate for election 50% or more of the Board of Directors of either (1) Holdings (or Successor
Holdings, if applicable) or (2) a Parent Entity;
(b)
the Borrower ceasing to be a direct wholly owned Subsidiary of Holdings (or Successor Holdings, if
applicable); and
(c)
a Change of Control or similar event occurring under the Senior Secured Notes Indenture or the Term Loan
Credit Agreement.
“Change of Control Offer” has the meaning assigned to such term in the Indenture governing the Existing Notes.
“Class” when used in reference to (a) any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such
Borrowing, are Tranche 1 Revolving Loans, Tranche 2 Revolving Loans, Swing Line Loans, Protective Advances or Extended Revolving
Loans, (b) any Commitment, refers to whether such Commitment is a Commitment in respect of Tranche 1 Revolving Loans, Tranche 2
Revolving Loans, Swing Line Loans or a Commitment in respect of a Class of Loans to be made pursuant to an Extension Amendment and
(c) any Lender, refers to whether such Lender has a Loan or Commitment with respect to a particular Class of Loans or Commitments.
“Closing Date” means the first date on which all of the conditions precedent in Section 4.01 are satisfied or waived in accordance
with Section 11.01.
“Closing Date ABL Intercreditor Agreement” means the Intercreditor Agreement, dated as of the Closing Date, by and among
the Collateral Agent, each Debt Representative under the Senior Secured Notes Indenture and the Term Loan Credit Agreement, and each
additional representative from time to time party thereto, as acknowledged by the Loan Parties, as amended, restated, supplemented, or
otherwise modified from time to time in accordance with the terms thereof.
“Closing Date EBITDA” means $415,000,000.
“Closing Date First Lien Net Leverage Ratio” means 3.70 to 1.00.
“Closing Date Refinancing” has the meaning specified in the preliminary statements to this Agreement.
“Closing Date Secured Net Leverage Ratio” means 3.70 to 1.00.
“Closing Date Total Net Leverage Ratio” means 3.70 to 1.00.
“Co-Borrower” has the meaning specified in Section 1.10.
“Co-Borrower Effective Date” has the meaning specified in Section 1.10.
“Co-Investor” means any of (a) the assignees, if any, of the equity commitments of Jackson Wijaya who became holders of
Equity Interests in Holdings (or any of the direct or indirect parent companies of Holdings) on the Closing Date in connection with the
Acquisition and (b) the transferees, if any, that acquired, within 45 days of the Closing Date, any Equity Interests in Holdings (or any of the
direct or indirect parent companies of Holdings) held by Jackson Wijaya as of the Closing Date; provided, that Co-
15
Investors under this clause (b) (A) do not in the aggregate hold more than 49.9% of the ordinary voting power represented by the issued and
outstanding Equity Interests of Holdings (or any of the direct or indirect parent companies of Holdings) and (B) shall have been identified to
the Administrative Agent in writing prior to the Closing Date.
“Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time.
“Collateral” means all the “Collateral” (or equivalent term, including “hypothecated property”) as defined in any Collateral
Document and all other property that is subject or purported to be subject to any Lien in favor of the Collateral Agent for the benefit of the
Secured Parties pursuant to any Collateral Document, but in any event excluding all Excluded Assets.
“Collateral Agent” has the meaning specified in the introductory paragraph to this Agreement.
“Collateral Access Agreement” means a landlord waiver or other agreement, in a form as shall be reasonably satisfactory to the
Collateral Agent, between the Collateral Agent and any third party (including any bailee, consignee, customs broker, or other similar Person)
in possession of any Collateral or any landlord of any premises where any Collateral is located, as such landlord waiver or other agreement
may be amended, restated, or otherwise modified from time to time..
“Collateral Documents” means, collectively, the Security Agreement, Canadian Security Agreement, the Intellectual Property
Security Agreements, the Security Agreement Supplements, the Canadian Security Agreement Supplements, security agreements, deeds of
hypothec or other similar agreements delivered to the Agents and the Lenders pursuant to Sections 4.01(a), 6.11, 6.12 or 6.15, and each of the
other agreements, instruments or documents that creates or purports to create a Lien in favor of the Collateral Agent for the benefit of the
Secured Parties.
“Commitment Letter” means the Second Amended and Restated Commitment Letter, dated as of June 10, 2021, by and among
the Initial Borrower, Barclays Bank PLC, Bank of Montreal, BMO Capital Markets Corp., Credit Suisse AG, Cayman Islands Branch, Credit
Suisse Loan Funding LLC, Wells Fargo Bank, National Association and Wells Fargo Securities, LLC.
“Commitment Parties” has the meaning specified in the Commitment Letter.
“Commitments” means the Tranche 1 Revolving Commitments and Tranche 2 Revolving Commitments.
“Committed Loan Notice” means a notice of a Borrowing pursuant to Article II, which, if in writing, shall be substantially in the
form of Exhibit A-1 or such other form as may be approved by the Administrative Agent (including any form on an electronic platform or
electronic transmission system as shall be approved by the Administrative Agent).
“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any
successor statute.
“Company” has the meaning specified in the preliminary statements to this Agreement.
“Company Person” means any future, current or former officer, director, manager, member, member of management, employee,
consultant or independent contractor of the Borrower, any Subsidiary, Holdings or any Parent Entity.
16
“Company Specified Representations” means those representations and warranties made by the Borrower, including with
respect to each of its Subsidiaries that is required to become a Guarantor upon the consummation of the Acquisition, in Sections 5.01(a) (with
respect to organizational existence only), 5.01(b)(ii), 5.02(a), 5.02(b)(i), 5.04, 5.13, 5.16, 5.17 (with respect the use of proceeds of the Loans
not in violation of the FCPA and OFAC) and 5.18.
“Compliance Certificate” means a certificate substantially in the form of Exhibit C.
“Concentration Account” has the meaning specified in Section 6.19(b).
“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however
denominated) or that are franchise Taxes or branch profits Taxes.
“Consolidated Adjusted EBITDA” means, with respect to any Person for any Test Period, the Consolidated Net Income of such
Person for such Test Period:
(a)
increased, without duplication, by the following items (solely to the extent deducted (and not excluded) in
calculating Consolidated Net Income, other than in respect of the proviso in clause (i) below and clauses (ii)(B), (xi), (xix) and
(xx) below) of such Person and its Restricted Subsidiaries for such Test Period determined on a consolidated basis in accordance
with GAAP:
(i)
interest expense, including (A) imputed interest on Capitalized Lease Obligations and Attributable
Indebtedness (which, in each case, will be deemed to accrue at the interest rate reasonably determined by a Responsible
Officer of the Borrower to be the rate of interest implicit in such Capitalized Lease Obligations or Attributable
Indebtedness), (B) commissions, discounts and other fees, charges and expenses owed with respect to letters of credit,
bankers’ acceptance financing, surety and performance bonds and receivables financings, (C) amortization and write-
offs of deferred financing fees, debt issuance costs, debt discounts, commissions, fees, premium and other expenses, as
well as expensing of bridge, commitment or financing fees, (D) payments made in respect of hedging obligations or
other derivative instruments entered into for the purpose of hedging interest rate risk, (E) cash contributions to any
employee stock ownership plan or similar trust to the extent such contributions are used by such plan or trust to pay
interest or fees to any Person (other than such Person or a wholly-owned Restricted Subsidiary) in connection with
Indebtedness incurred by such plan or trust, (F) all interest paid or payable with respect to discontinued operations, (G)
the interest portion of any deferred payment obligations, (H) all interest on any Indebtedness that is (x) Indebtedness of
others secured by any Lien on property owned or acquired by such Person or its Restricted Subsidiaries, whether or not
the obligations secured thereby have been assumed, but limited to the fair market value of such property or (y)
contingent obligations in respect of Indebtedness; provided that such interest expense shall be calculated after giving
effect to Hedge Agreements related to interest rates (including associated costs), but excluding unrealized gains and
losses with respect to such Hedge Agreements and (I) fees and expenses paid to the Administrative Agent (in its
capacity as such and for its own account) pursuant to the Loan Documents and fees and expenses paid to the
administrative agent, the collateral agent, trustee or other similar Persons for any other Indebtedness permitted by
Section 7.03; provided further that, when determining such interest expense in respect of any Test Period ending prior
to the first anniversary of the Closing Date, such interest expense will be calculated by multiplying the aggregate
amount of such interest expense accrued since
17
the Closing Date by 365 and then dividing such product by the number of days from and including the Closing Date to
and including the last day of such Test Period; plus
(ii)
taxes based on gross receipts, income, profits or revenue or capital, franchise, excise,
property, commercial activity, sales, use, unitary or similar taxes, and foreign withholding taxes, including (A) penalties
and interest and (B) tax distributions made to any direct or indirect holders of Equity Interests of such Person in respect
of any such taxes attributable to such Person and/or its Restricted Subsidiaries or pursuant to a tax sharing arrangement
or as a result of a tax distribution or repatriated fund; plus
(iii)
depreciation expense and amortization expense (including amortization and similar
charges related to goodwill, customer relationships, trade names, databases, technology, software, internal labor costs,
deferred financing fees or costs and other intangible assets); plus
(iv)
non-cash items (provided that if any such non-cash item represents an accrual or reserve
for potential cash items in any future period, (x) the Borrower may determine not to add back such non-cash item in the
current Test Period, (y) to the extent the Borrower decides to add back such non-cash expense or charge, the cash
payment in respect thereof in such future period will be subtracted from Consolidated Adjusted EBITDA in such future
period), including the following: (A) non-cash expenses in connection with, or resulting from, stock option plans,
employee benefit plans or agreements or post-employment benefit plans or agreements, or grants or sales of stock,
stock appreciation or similar rights, stock options, restricted stock, preferred stock or other similar rights, (B) non-cash
currency translation losses related to changes in currency exchange rates (including re-measurements of Indebtedness
(including intercompany Indebtedness) and any net non-cash loss resulting from hedge agreements for currency
exchange risk), (C) non-cash losses, expenses, charges or negative adjustments attributable to the movement in the
mark-to-market valuation of hedge agreements or other derivative instruments, including the effect of FASB
Accounting Standards Codification 815 and International Accounting Standard No. 9 and their respective related
pronouncements and interpretations, (D) non-cash charges for deferred tax asset valuation allowances, (E) any non-cash
impairment charge or asset write-off or write-down related to intangible assets (including goodwill), long-lived assets,
and Investments in debt and equity securities, (F) any non-cash charges or losses resulting from any purchase
accounting adjustment or any step-ups with respect to re-valuing assets and liabilities in connection with the
Transactions or any Investments either existing or arising after the Closing Date, (G) all non-cash losses from
Investments either existing or arising after the Closing Date recorded using the equity method and (H) the excess of
GAAP rent expense over actual cash rent paid during such period due to the use of straight line rent for GAAP
purposes and (z) any non-cash interest expense; plus
(v)
unusual, extraordinary, infrequent or non-recurring items, whether or not classified as such
under GAAP; plus
(vi)
charges, costs, losses, expenses or reserves related to: (A) restructuring (including
restructuring charges or reserves, whether or not classified as such under GAAP), severance, relocation, consolidation,
integration or other similar items, (B) strategic and/or business initiatives, business optimization (including costs and
expenses relating to business optimization programs, which, for the avoidance of doubt, shall include, without
limitation, implementation of operational and reporting systems and
18
technology initiatives; strategic initiatives; retention; severance; systems establishment costs; systems conversion and
integration costs; contract termination costs; recruiting and relocation costs and expenses; costs, expenses and charges
incurred in connection with curtailments or modifications to pension and post-retirement employee benefits plans; costs
to start-up, pre-opening, opening, closure, transition and/or consolidation of distribution centers, operations, officers
and facilities) including in connection with the Transactions and any Permitted Investment, any acquisition or other
investment consummated prior to the Closing Date and new systems design and implementation, as well as consulting
fees and any one-time expense relating to enhanced accounting function, (C) business or facilities (including greenfield
facilities) start-up, opening, transition, consolidation, shut-down and closing, (D) signing, retention and completion
bonuses, (E) severance, relocation or recruiting, (F) public company registration, listing, compliance, reporting and
related expenses, (G) charges and expenses incurred in connection with litigation (including threatened litigation), any
investigation or proceeding (or any threatened investigation or proceeding) by a regulatory, governmental or law
enforcement body (including any attorney general), and (H) expenses incurred in connection with casualty events or
asset sales outside the ordinary course of business; plus
(vii)
all (A) costs, fees and expenses relating to the Transactions, (B) costs, fees and expenses
(including diligence and integration costs) incurred in connection with (x) investments in any Person, acquisitions of
the Equity Interests of any Person, acquisitions of all or a material portion of the assets of any Person or constituting a
line of business of any Person, and financings related to any of the foregoing or to the capitalization of any Loan Party
or any Restricted Subsidiary or (y) other transactions that are out of the ordinary course of business of such Person and
its Restricted Subsidiaries (in each case of clause (x) and (y), including transactions considered or proposed but not
consummated), including Permitted Equity Issuances, Investments, acquisitions, dispositions, recapitalizations,
mergers, amalgamations, option buyouts and the incurrence, modification or repayment of Indebtedness (including all
consent fees, premium and other amounts payable in connection therewith) and (C) non-operating professional fees,
costs and expenses; plus
(viii)
items reducing Consolidated Net Income to the extent (A) covered by a binding
indemnification or refunding obligation or insurance to the extent actually paid or reasonably expected to be paid, (B)
paid or payable (directly or indirectly) by a third party that is not a Loan Party or a Restricted Subsidiary (except to the
extent such payment gives rise to reimbursement obligations) or with the proceeds of a contribution to equity capital of
such Person by a third party that is not a Loan Party or a Restricted Subsidiary or (C) such Person is, directly or
indirectly, reimbursed for such item by a third party; plus
(ix)
the amount of management, monitoring, consulting, transaction and advisory fees
(including termination fees) and related indemnities and expenses paid, payable or accrued in such Test Period
(including any termination fees payable in connection with the early termination of management and monitoring
agreements); plus
(x)
the effects of purchase accounting, fair value accounting or recapitalization accounting
(including the effects of adjustments pushed down to such Person and its Subsidiaries) and the amortization, write-
down or write-off of any such amount; plus
19
(xi)
proceeds of business interruption insurance actually received (to the extent not counted in
any prior period in anticipation of such receipt) or, to the extent not counted in any prior period, reasonably expected to
be received; plus
(xii)
minority interest expense consisting of income attributable to Equity Interests held by
third parties in any non-wholly-owned Restricted Subsidiary; plus
(xiii)
all charges, costs, expenses, accruals or reserves in connection with the rollover,
acceleration or payout of Equity Interests held by officers or employees and all losses, charges and expenses related to
payments made to holders of options or other derivative Equity Interests of such Person or any direct or indirect parent
thereof in connection with, or as a result of, any distribution being made to equity holders of such Person or any direct
or indirect parent thereof, including (A) payments made to compensate such holders as though they were equity holders
at the time of, and entitled to share in, such distribution, and (B) all dividend equivalent rights owed pursuant to any
compensation or equity arrangement; plus
(xiv)
expenses, charges and losses resulting from the payment or accrual of indemnification or
refunding provisions, earn-outs and contingent consideration obligations; bonuses and other compensation paid to
employees, directors or consultants; and payments in respect of dissenting shares and purchase price adjustments; in
each case, made in connection with a Permitted Investment or other transactions disclosed in the documents referred to
in clause ((xix)) below; plus
(xv)
any losses from abandoned, closed, disposed or discontinued operations or operations that
are anticipated to become abandoned, closed, disposed or discontinued; plus
(xvi)
(A) any costs or expenses (including any payroll taxes) incurred by the Borrower or any
Restricted Subsidiary in such Test Period as a result of, in connection with or pursuant to any management equity plan,
profits interest or stock option plan or any other management or employee benefit plan or agreement, any pension plan
(including (1) any post-employment benefit scheme to which the relevant pension trustee has agreed, (2) as a result of
curtailments or modifications to pension and post-retirement employee benefit plans and (3) without limitation,
compensation arrangements with holders of unvested options entered into in connection with a permitted Restricted
Payment), any stock subscription, stockholders or partnership agreement, any payments in the nature of compensation
or expense reimbursement made to independent board members, any employee benefit trust, any employee benefit
scheme or any similar equity plan or agreement (including any deferred compensation arrangement), including any
payment made to option holders in connection with, or as a result of, any distribution being made to, or share
repurchase from, a shareholder, which payments are being made to compensate option holders as though they were
shareholders at the time of, and entitled to share in, such distribution or share repurchase and (B) any costs or expenses
incurred in connection with the rollover, acceleration or payout of Equity Interests held by management of Holdings (or
any Parent Entity, the Borrower and/or any Restricted Subsidiary); plus
(xvii)
the amount of loss or discount on sale of receivables, Securitization Assets and related
assets to any Securitization Subsidiary in connection with a Qualified Securitization Financing; plus
20
(xviii)
(xix)
the cumulative effect of a change in accounting principles; plus
addbacks reflected in the Model in connection with the Transactions or the quality of
earnings report delivered to the Lead Arrangers in connection with the Transactions; plus
(xx)
the amount of “run rate” cost savings, operating expense reductions and other cost
synergies that are projected by the Borrower in good faith to result from actions taken, committed to be taken or
expected to be taken no later than 36 months after the end of such Test Period (which amounts will be determined by
the Borrower in good faith and calculated on a pro forma basis as though such amounts had been realized on the first
day of the Test Period for which Consolidated Adjusted EBITDA is being determined), net of the amount of actual
benefits realized during such Test Period from such actions; provided that, in the good faith judgment of the Borrower
such cost savings are reasonably identifiable, reasonably anticipated to be realized and factually supportable (it being
agreed such determinations need not be made in compliance with Regulation S-X or other applicable securities law);
plus
(xxi)
to the extent not included in Consolidated Net Income for such period, cash actually
received (or any netting arrangement resulting in reduced cash expenditures) during such period so long as the non-cash
gain relating to the relevant cash receipt or netting arrangement was deducted in the calculation of Consolidated
Adjusted EBITDA for any previous period and not added back; plus
(xxii)
(xxiii)
property or other assets; plus
(xxiv)
(xxv)
[reserved]; plus
the amount of any contingent payments in connection with the licensing of intellectual
Public Company Costs; plus
the amount of fees, expense reimbursements and indemnities paid to directors and/or
members of advisory boards, including directors of Holdings or any other Parent Entity; plus
(xxvi)
any net pension or other post-employment benefit costs representing amortization of
unrecognized prior service costs, actuarial losses, including amortization or such amounts arising in prior periods,
amortization of the unrecognized net obligation (and loss or cost) existing at the date of initial application of FASB
Accounting Standards Codification 715, and any other items of a similar nature; plus
(xxvii)
payments made pursuant to Earnouts and Unfunded Holdbacks; and
(b)
decreased, without duplication, by the following items of such Person and its Restricted Subsidiaries for such
Test Period determined on a consolidated basis in accordance with GAAP (solely to the extent increasing Consolidated Net
Income):
(i)
any amount which, in the determination of Consolidated Net Income for such period, has
been included for any non-cash income or non-cash gain, all as determined in accordance with GAAP (provided that if
any non-cash income or non-cash gain represents an accrual or deferred income in respect of potential cash items in any
future
21
period, such Person may determine not to deduct the relevant non-cash gain or income in the then-current period); plus
(ii)
the amount of any cash payment made during such period in respect of any non-cash
accrual, reserve or other non-cash charge that is accounted for in a prior period and that was added to Consolidated Net
Income to determine Consolidated Adjusted EBITDA for such prior period and that does not otherwise reduce
Consolidated Net Income for the current period; plus
(iii)
the excess of actual cash rent paid over rent expense during such period due to the use of straight-
line rent for GAAP purposes; plus
(iv)
the amount of any income or gain associated with any Restricted Subsidiary that is attributable to
any non-controlling interest and/or minority interest of any third party; plus
(v)
(vi)
any net income from disposed or discontinued operations; plus
any unusual, extraordinary, infrequent or non-recurring gains.
Notwithstanding the foregoing, the Consolidated Adjusted EBITDA (i) for the fiscal quarter ending September 30, 2020 shall be
$87,000,000, (ii) for the fiscal quarter ending December 31, 2020 shall be $91,000,000, (iii) for the fiscal quarter ending March 31, 2021
shall be $79,000,000 and (iv) for the fiscal quarter ending June 30, 2021 shall be $158,000,000, in each case, as such amounts may be
adjusted pursuant to the foregoing provisions and other pro forma adjustments permitted by this Agreement (including as necessary to give
Pro Forma Effect to any Specified Transaction).
“Consolidated Capital Expenditures” means, for any period, the aggregate amount of all expenditures of the Borrower and its
Restricted Subsidiaries during such period determined on a consolidated basis that, in accordance with GAAP, are or should be included as
additions to property, plant and equipment in the consolidated statement of cash flows of the Borrower. Notwithstanding the foregoing,
Consolidated Capital Expenditures shall not include:
(a)
the purchase price of property, plant, equipment or software in an amount equal to the proceeds of asset
dispositions of fixed or capital assets that are not required to be applied to prepay the Term Loans pursuant to Section 2.07(b)(ii)
of the Term Loan Credit Agreement (as in effect on the Closing Date);
(b)
expenditures made with tenant allowances received by the Borrower or any of its Subsidiaries from landlords
in the ordinary course of business and subsequently capitalized;
(c)
any amounts spent in connection with Investments permitted pursuant to Section 7.02, Permitted Acquisitions
and expenditures made in connection with the Transactions;
(d)
expenditures financed with the proceeds of an issuance of capital stock of any parent company of the
Borrower, or any cash capital contribution to the Borrower;
(e)
expenditures that are accounted for as capital expenditures by the Borrower or any Restricted Subsidiary and
that actually are paid for by a Person other than the Borrower or any Restricted Subsidiary to the extent neither the Borrower nor
any Restricted Subsidiary has provided
22
or is required to provide or incur, directly or indirectly, any consideration or obligation to such Person or any other Person
(whether before, during or after such period);
(f)
any expenditures which are contractually required to be, and are, advanced or reimbursed to the Borrower or
any Restricted Subsidiary in cash by a third party (including landlords) during such period of calculation;
(g)
the book value of any asset owned by the Borrower or any Restricted Subsidiary prior to or during such
period to the extent that such book value is included as a capital expenditure during such period as a result of such Person reusing
or beginning to reuse such asset during such period without a corresponding expenditure actually having been made in such
period; provided that (i) any expenditure necessary in order to permit such asset to be reused shall be included as a capital
expenditure during the period in which such expenditure actually is made and (ii) such book value shall have been included in
capital expenditures when such asset was originally acquired;
(h)
that portion of interest on Indebtedness incurred for capital expenditures which is paid in cash and capitalized
in accordance with GAAP;
(i)
expenditures made in connection with the replacement, substitution, restoration, upgrade, development or
repair of assets to the extent financed with (x) insurance or settlement proceeds paid on account of the loss of or damage to the
assets being replaced, substituted, restored, upgraded, developed or repaired or (y) awards of compensation arising from the taking
by eminent domain or condemnation of the assets being replaced;
(j)
in the event that any equipment is purchased simultaneously with the trade-in of existing equipment, the gross
amount of the credit granted by the seller of such equipment for the equipment being traded in at such time;
(k)
expenditures
reconstruction, development,
refurbishment, renovation or improvement of any property which has been transferred to a Person other than the Borrower or any
Restricted Subsidiary during the same Fiscal Year in which such expenditures were made pursuant to a sale leaseback transaction
to the extent of the cash proceeds received by the Borrower or Restricted Subsidiary pursuant to such sale leaseback that are not
required to prepay the Term Loans pursuant to Section 2.07(b)(ii) of the Term Loan Credit Agreement; or
the construction, acquisition,
replacement,
relating
to
(l)
the Transactions.
“Consolidated Cash Interest Expense” means, for any period, Consolidated Interest Expense for such period, excluding (a) any
amount not paid or payable currently in cash and (b) Transaction Expenses otherwise included in Consolidated Interest Expense.
“Consolidated Interest Expense” means, for any Test Period, the sum of:
(a)
cash interest expense (including that attributable to Capitalized Leases), net of cash interest income, of the
Borrower and the Restricted Subsidiaries with respect to all outstanding Indebtedness of the Borrower and the Restricted
Subsidiaries, including all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’
acceptance financing and net costs under hedging agreements, plus
23
(b)
non-cash interest expense resulting solely from the amortization of original issue discount from the issuance
of Indebtedness of the Borrower and the Restricted Subsidiaries (excluding Indebtedness borrowed under this Agreement, the
Term Loan Credit Agreement or the Senior Secured Notes in connection with and to finance the Transactions) at less than par, plus
(c)
pay-in-kind interest expense of the Borrower and the Restricted Subsidiaries payable pursuant to the terms of
the agreements governing such debt for borrowed money;
but excluding, for the avoidance of doubt, (i) amortization of deferred financing costs, debt issuance costs, commissions, fees and expenses
and any other amounts of non-cash interest other than referred to in clause (b) above (including as a result of the effects of acquisition
method accounting or pushdown accounting), (ii) non-cash interest expense attributable to the movement of the mark-to-market valuation of
obligations under hedging agreements or other derivative instruments pursuant to FASB Accounting Standards Codification No. 815-
Derivatives and Hedging, (iii) any one-time cash costs associated with breakage in respect of hedging agreements for interest rates, (iv)
commissions, discounts, yield, make whole premium and other fees and charges (including any interest expense) incurred in connection with
any receivables financing (including any Qualified Securitization Financing), (v) any “additional interest” owing pursuant to a registration
rights agreement with respect to any securities, (vi) any payments with respect to make-whole premiums or other breakage costs of any
Indebtedness, including any Indebtedness issued in connection with the Transactions, (vii) penalties and interest relating to taxes, (viii)
accretion or accrual of discounted liabilities not constituting Indebtedness, (ix) interest expense attributable to a direct or indirect Parent
Entity resulting from push-down accounting, (x) any expense resulting from the discounting of Indebtedness in connection with the
application of recapitalization or purchase accounting and (xi) any interest expense attributable to the exercise of appraisal rights and the
settlement of any claims or actions (whether actual, contingent or potential) with respect thereto and with respect to any Acquisition
Transaction or other Investment, all as calculated on a consolidated basis in accordance with GAAP. For the avoidance of doubt, (i) interest
expense shall be determined after giving effect to any net payments made or received by the Borrower and its Restricted Subsidiaries in
respect of Swap Contracts relating to interest rate protection and (ii) interest on a Capitalized Lease Obligation shall be deemed to accrue at
an interest rate reasonably determined by the Borrower to be the rate of interest implicit in such Capitalized Lease Obligation in accordance
with GAAP.
“Consolidated Net Debt” means, as of any date of determination, (a) Consolidated Total Debt minus (b) the aggregate amount of
cash and Cash Equivalents of the Borrower and the Restricted Subsidiaries as of such date that is not Restricted.
“Consolidated Net Income” means, with respect to any Person for any Test Period, the Net Income of such Person and its
Restricted Subsidiaries determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from such
consolidated net income (to the extent otherwise included therein), without duplication:
(a)
the Net Income for such Test Period of any Person that is not a Subsidiary, or is an Unrestricted Subsidiary, or
that is accounted for by the equity method of accounting; provided that the Borrower’s or any Restricted Subsidiary’s equity in the
Net Income of such Person shall be included in the Consolidated Net Income of the Borrower for such Test Period up to the
aggregate amount of dividends or distributions or other payments in respect of such equity that are actually paid in cash (or to the
extent converted into cash) by such Person to the Borrower or a Restricted Subsidiary, in each case, in such Test Period, to the
extent not already included therein;
(b)
[reserved];
24
(c)
any gain (or loss), together with any related provisions for taxes on any such gain (or the tax effect of any
such loss), realized by such Person or any of its Restricted Subsidiaries during such Test Period upon any asset sale or other
disposition of any Equity Interests of any Person (other than any dispositions in the ordinary course of business) by such Person or
any of its Restricted Subsidiaries;
(d)
gains and losses due solely to fluctuations in currency values and the related tax effects determined in
accordance with GAAP for such Test Period;
(e)
earnings (or losses), including any impairment charge, resulting from any reappraisal, revaluation or write-up
(or write-down) of assets during such Test Period;
(f)
(i) unrealized gains and losses with respect to Hedge Agreements for such Test Period and the application of
Accounting Standards Codification 815 (Derivatives and Hedging) and (ii) any after-tax effect of income (or losses) for such Test
Period that result from the early extinguishment of (A) Indebtedness, (B) obligations under any Hedge Agreements or (C) other
derivative instruments;
(g)
any extraordinary, infrequent, non-recurring or unusual gain (or extraordinary, infrequent, non-recurring or
unusual loss), together with any related provision for taxes on any such gain (or the tax effect of any such loss), recorded or
recognized by such Person or any of its Restricted Subsidiaries during such Test Period;
(h)
the cumulative effect of a change in accounting principles and changes as a result of the adoption or
modification of accounting policies during such Test Period;
(i)
after-tax gains (or losses) on disposal of disposed, abandoned or discontinued operations for such Test Period;
(j)
effects of adjustments (including the effects of such adjustments pushed down to such Person and its
Restricted Subsidiaries) in the inventory, property and equipment, software, goodwill, other intangible assets, in-process research
and development, deferred revenue, debt and unfavorable or favorable lease line items in such Person’s consolidated financial
statements pursuant to GAAP for such Test Period resulting from the application of purchase accounting in relation to the
Transactions or any acquisition consummated prior to the Closing Date and any Permitted Acquisition or other Investment or the
amortization or write-off of any amounts thereof, net of taxes, for such Test Period;
(k)
any non-cash compensation charge or expense for such Test Period, including any such charge or expense
arising from the grants of stock appreciation or similar rights, stock options, restricted stock or other rights and any cash charges
or expenses associated with the rollover, acceleration or payout of Equity Interests by, or to, management of such Person or any of
its Restricted Subsidiaries in connection with the Transactions;
(l)
(i) Transaction Expenses incurred during such Test Period and (ii) any fees and expenses incurred during such
Test Period, or any amortization thereof for such Test Period, in connection with any acquisition (other than the Transactions),
Investment, disposition, issuance or repayment of Indebtedness, issuance of Equity Interests, refinancing transaction or
amendment or modification of any debt or equity instrument (in each case, including any such transaction whether consummated
on, after or prior to the Closing Date and any such transaction undertaken but not
25
completed) and any charges or non-recurring costs incurred during such Test Period as a result of any such transaction;
(m)
any expenses, charges or losses for such Test Period that are covered by indemnification or other
reimbursement provisions in connection with any Investment, Permitted Acquisition or any sale, conveyance, transfer or other
disposition of assets permitted under this Agreement, to the extent actually reimbursed, or, so long as the Borrower has made a
determination that a reasonable basis exists for indemnification or reimbursement and only to the extent that such amount is in fact
indemnified or reimbursed within 365 days of such determination (with a deduction in the applicable future period for any amount
so added back to the extent not so indemnified or reimbursed within such 365 days); and
(n)
to the extent covered by insurance and actually reimbursed, or, so long as the Borrower has made a
determination that there exists reasonable evidence that such amount will in fact be reimbursed within 365 days of the date of such
determination (with a deduction in the applicable future period for any amount so added back to the extent not so reimbursed
within such 365 days), expenses, charges or losses for such Test Period with respect to liability or casualty events or business
interruption.
“Consolidated Secured Net Debt” means, as of any date of determination, Consolidated Net Debt that is secured by a Lien on the
Collateral outstanding as of such date, other than Capitalized Lease Obligations.
“Consolidated Total Debt” means, as of any date of determination, the aggregate principal amount of third party Indebtedness of
the Borrower and the Restricted Subsidiaries outstanding on such date, determined on a consolidated basis and as reflected on the face of a
balance sheet prepared in accordance with GAAP (but excluding the effects of the application of purchase accounting in connection with the
Transactions, any Permitted Acquisition or any other Investment permitted hereunder), consisting of Indebtedness for borrowed money,
unreimbursed obligations in respect of drawn letters of credit (to the extent not cash collateralized), and obligations in respect of Capitalized
Leases and purchase money obligations and debt obligations evidenced by promissory notes or debentures; provided that Consolidated Total
Debt will not include Indebtedness in respect of (a) any Qualified Securitization Financing, (b) any letter of credit, except to the extent of
unreimbursed obligations in respect of drawn letters of credit (provided that any unreimbursed amount under commercial letters of credit will
not be counted as Consolidated Total Debt until three Business Days after such amount is drawn (it being understood that any borrowing,
whether automatic or otherwise, to fund such reimbursement will be counted)), (c) obligations under Hedge Agreements, (d) obligations in
respect of cash management obligations, (e) purchase money obligations incurred in the ordinary course, trade payable and earn outs and
similar obligations, (f) Indebtedness to the extent it has been cash collateralized, and (g) any lease obligations other than in respect of
Capitalized Leases.
“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.
“Contribution Indebtedness” means Indebtedness in an aggregate principal amount at the time of the incurrence thereof not to
exceed an amount equal to 200.00% of the amount of any Permitted Equity Issuances during the period from and including the Business Day
immediately following the Closing Date through and including the reference date that are Not Otherwise Applied.
“Control” has the meaning specified in the definition of “Affiliate.”
26
“Conversion/Continuation Notice” means a notice of (a) a conversion of Loans from one Type to another or (b) a continuation of
Eurocurrency Rate Loans, pursuant to Article II, which, if in writing, shall be substantially in the form of Exhibit A-3.
“Covenant Trigger Event” means any date after the last day of the first full fiscal quarter ended after the Closing Date on which
Specified Excess Availability shall be less than the greater of (a) 10% of the Line Cap and (b) $35,000,000 at any time and continuing until
Specified Excess Availability is equal to or exceeds the greater of (a) 10% of the Line Cap and (b) $35,000,000 for thirty (30) consecutive
calendar days; provided that such $35,000,000 level shall automatically increase in proportion to the amount of any increase in the aggregate
Revolving Commitments hereunder in connection with any Incremental Facility.
“Covered Entity” means any of the following:
(a)
(b)
(c)
a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);
a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R § 47.3(b); or
a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Covered Party” has the meaning specified in Section 11.26(b).
“Credit Agreement Refinancing Indebtedness” has the meaning assigned to such term in the Term Loan Credit Agreement (as
in effect on the date hereof).
“Credit Extension” means each of (i) the making of a Revolving Loan, Swing Line Loan or Protective Advance and (ii) the
issuance, amendment, modification, renewal or extension of any Letter of Credit (other than any such amendment, modification, renewal or
extension that does not increase the stated amount of the relevant Letter of Credit).
“CS” has the meaning specified in the introductory paragraph to this Agreement.
“Cure Expiration Date” has the meaning specified in Section 8.02.
“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being
established by the Administrative Agent in accordance with the conventions for this rate recommended by the Relevant Governmental Body
for determining “Daily Simple SOFR” for syndicated business loans; provided, that if the Administrative Agent decides that any such
convention is not administratively feasible for the Administrative Agent, then the Administrative Agent may establish another convention in
its reasonable discretion.
“DDA” means any checking, demand deposit or other account maintained by the Loan Parties and used to receive or deposit
payments, checks and other funds from customers and other payors, other than any Excluded Account.
“Debt Representative” means, with respect to any series of Indebtedness secured by a Lien that is subject to an Intercreditor
Agreement, or is subordinated in right of payment to all or any part of the Obligations, the trustee, administrative agent, collateral agent,
security agent or similar agent under the
27
indenture or agreement pursuant to which such Indebtedness is issued, incurred or otherwise obtained, as the case may be, and each of their
successors in such capacities.
“Debtor Relief Laws” means the Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada), the Companies’ Creditors
Arrangement Act (Canada), the Winding-up and Restructuring Act (Canada), and all other liquidation, conservatorship, bankruptcy,
assignment for the benefit of creditors, moratorium, arrangement, rearrangement, receivership, insolvency, reorganization, or similar debtor
relief Laws of the United States, Canada or other applicable jurisdictions from time to time in effect and affecting the rights of creditors
generally, including any applicable corporations legislation to the extent the relief sought under such corporations legislation relates to or
involves the compromise, settlement, adjustment or arrangement of debt.
“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of
time, or both, would be an Event of Default.
“Default Rate” means an interest rate equal to (a) the Base Rate plus (b) the Applicable Rate applicable to Base Rate Loans plus
(c) 2.00% per annum; provided that with respect to the outstanding principal amount of any Loan not paid when due, the Default Rate shall
be an interest rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan (giving effect to
Section 2.05(c)) plus 2.00% per annum, in each case, to the fullest extent permitted by applicable Laws.
“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2
or 382.1, as applicable.
“Defaulting Lender” means, subject to Section 2.19(b), any Lender that,
(a)
has failed to (i) fund all or any portion of its Loans, including participations in respect of Letters of Credit,
Swing Line Loans or Protective Advances within two Business Days of the date such Loans were required to be funded hereunder
unless such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s
determination that one or more conditions precedent to funding (which conditions precedent, together with the applicable default,
if any, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, the Swing
Line Lender, the Issuing Banks or any other Lender any other amount required to be paid by it hereunder (including in respect of
its participation in Letters of Credit, Swing Line Loans or Protective Advances) within two Business Days of the date when due,
(b)
has notified the Borrower, the Administrative Agent, the Swing Line Lender or the Issuing Banks in writing
that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such
writing or public statement relates to such Lenders’ obligation to fund a Loan hereunder and states that such position is based on
such Lender’s determination that a condition precedent to funding (which condition precedent, together with the applicable
default, if any, shall be specifically identified in such writing or public statement) cannot be satisfied),
(c)
has failed, within three Business Days after written request by the Administrative Agent or the Borrower, to
confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations
hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written
confirmation by the Administrative Agent and the Borrower), or
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(d)
the Administrative Agent or the Borrower has received notification that such Lender is, or has a direct or
indirect parent entity that is, (i) insolvent, or is generally unable to pay its debts as they become due, or admits in writing its
inability to pay its debts as they become due, or makes a general assignment for the benefit of its creditors, (ii) other than via an
Undisclosed Administration, the subject of a bankruptcy, insolvency, reorganization, liquidation or similar proceeding, or a
receiver, trustee, conservator, intervenor or sequestrator, administrator, assignee for the benefit of creditors or similar Person
charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any
other Federal or state regulatory authority acting in such a capacity or the like has been appointed for such Lender or its direct or
indirect parent entity, or such Lender or its direct or indirect parent entity has taken any action in furtherance of or indicating its
consent to or acquiescence in any such proceeding or appointment or (iii) become the subject of a Bail-In Action; provided that a
Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any Equity Interest in that Lender or
any direct or indirect parent entity thereof by a Governmental Authority so long as such ownership interest does not result in or
provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments
or writs of attachment on its assets or permit such Lender (or such Governmental Authority or instrumentality) to reject, repudiate,
disavow or disaffirm any contracts or agreements made with such Lender.
Any determination by the Administrative Agent or the Borrower that a Lender is a Defaulting Lender under any one or more of clauses (a)
through (d) above shall be conclusive absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to
Section 2.19) upon delivery of written notice of such determination to the Borrower, the Swing Line Lender, the Issuing Banks and each
Lender.
“Designated Jurisdiction” means any country or territory to the extent that such country or territory is the subject of any
Sanctions.
“Designated Non-Cash Consideration” means the fair market value of any non-cash consideration received by the Borrower or a
Restricted Subsidiary in connection with a Disposition pursuant to the General Asset Sale Basket that is designated as Designated Non-Cash
Consideration pursuant to a certificate of a Responsible Officer (which amount will be reduced by the fair market value of the portion of the
non-cash consideration converted to cash within one hundred eighty days following the consummation of the applicable Disposition).
“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition including any sale of Equity Interests in, or
issuance of Equity Interests by, a Restricted Subsidiary (excluding Liens and including, for the avoidance of doubt, any Division) of any
property by any Person.
“Disqualified Equity Interests” means any Equity Interest that, by its terms (or by the terms of any security or other Equity
Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition,
(a)
matures or is mandatorily redeemable (other than solely for Qualified Equity Interests), pursuant to a sinking
fund obligation or otherwise (except as a result of a change of control or asset sale as long as any rights of the holders thereof upon
the occurrence of a change of control or asset sale event is subject to the prior repayment in full of the Loans and all other
Obligations that are accrued and payable and the termination of the Commitments and Cash Collateralization of all Letters of
Credit),
(b)
is redeemable at the option of the holder thereof (other than solely for Qualified Equity Interests), in whole or
in part,
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(c)
(d)
provides for the scheduled payments of dividends that are required to be made only in cash, or
is or becomes convertible into or exchangeable for Indebtedness or any other Equity Interests that would
constitute Disqualified Equity Interests,
in each case, prior to the Latest Maturity Date of the Loans at the time of issuance; provided that if such Equity Interests are issued pursuant
to a plan for the benefit of one or more Company Persons or by any such plan to one or more Company Persons, such Equity Interests shall
not constitute Disqualified Equity Interests solely because they may be required to be repurchased by Holdings, the Borrower or the
Restricted Subsidiaries in order to satisfy applicable statutory or regulatory obligations or as a result of a Company Person’s termination,
death or disability; provided, further, that any class of Equity Interests of such Person that by its terms authorizes such Person to satisfy its
obligations thereunder by delivery of Equity Interests that is not Disqualified Equity Interests shall not be deemed to be Disqualified Equity
Interests.
“Disqualified Lender” means,
(a)
the competitors of the Borrower and its Subsidiaries identified in writing by or on behalf of the Borrower (i)
to the Lead Arrangers on or prior to the Closing Date, or (ii) to the Administrative Agent, from time to time on or after the Closing
Date;
(b)
(i) any Persons that are engaged as principals primarily in private equity or venture capital (other than a bona
fide debt fund affiliate of any of the Lead Arrangers) and (ii) those particular banks, financial institutions, other institutional
lenders and other Persons, in the case of each of clauses (i) and (ii), to the extent identified in writing by or on behalf of the
Borrower to the Lead Arrangers on or prior to May 10, 2021; and
(c)
any Affiliate of a Person described in the preceding clause (a) or (b) that (in each case with respect to clause
(a) above, other than any Affiliates that are banks, financial institutions, bona fide debt funds or investment vehicles that are
engaged in making, purchasing, holding or otherwise investing in commercial loans, bonds and similar extensions of credit in the
ordinary course), in each case, is either reasonably identifiable as such on the basis of its name or is identified as such in writing
by or on behalf of the Borrower (i) to the Lead Arrangers on or prior to the Closing Date, or (ii) to the Administrative Agent from
time to time on or after the Closing Date.
The Borrower may, in its discretion, make the list of Disqualified Lenders available to any Lender, Participant, or any prospective Lender or
Participant, upon request by such Lender, Participant or prospective Lender or Participant, as applicable. The Borrower shall, upon request
of any Lender, identify whether any Person identified by such Lender as a proposed assignee or Participant is a Disqualified Lender. To the
extent Persons are identified as Disqualified Lenders after the Closing Date pursuant to clause (a) or (c) above, the inclusion of such Persons
as Disqualified Lenders shall not retroactively apply to prior assignments or participations made in compliance with Section 11.07 hereof.
“Division” has the meaning specified in Section 1.02(d).
“Document” has the meaning set forth in Article 9 of the UCC or, if applicable, a “document of title” as defined in the PPSA.
“Dollar” and “$”mean lawful money of the United States.
“Dollar Amount” means, at any time:
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(a)
with respect to any Loan denominated in Dollars, the principal amount thereof then outstanding (or in which
such participation is held);
(b)
with respect to any Loan denominated in any Alternative Currency, the principal amount thereof then
outstanding in the relevant Alternative Currency converted to Dollars in accordance with Section 1.09;
(c)
with respect to any Letter of Credit Obligation (or any risk participation therein), (i) if denominated in
Dollars, the amount thereof and (ii) if denominated in any Alternative Currency other than Dollars, the amount thereof converted
to Dollars in accordance with Section 1.09; and
(d)
with respect to any other amount (i) if denominated in Dollars, the amount thereof and (ii) if denominated in
any currency other than Dollars, the equivalent amount thereof in Dollars as determined by the Administrative Agent or the
applicable Issuing Banks, as applicable, on the basis of the Exchange Rate (determined in respect of the most recent relevant date
of determination) for the purchase of Dollars with such currency.
“Domestic Subsidiary” means any Subsidiary that is organized under the Laws of the United States, any state thereof or the
District of Columbia.
“Early Opt-in Effective Date” means, with respect to any Early Opt-in Election, the sixth (6th) Business Day after the date notice
of such Early Opt-in Election is provided to the Lenders, so long as the Administrative Agent has not received, by 5:00 p.m. (New York City
time) on the fifth (5th) Business Day after the date notice of such Early Opt-in Election is provided to the Lenders, written notice of objection
to such Early Opt-in Election from Lenders comprising the Required Lenders.
“Early Opt-in Election” means the occurrence of:
(1) a notification by the Administrative Agent to (or the request by the Borrower to the Administrative Agent to notify)
each of the other parties hereto that at least five currently outstanding U.S. dollar-denominated syndicated credit facilities at such
time contain (as a result of amendment or as originally executed) a SOFR-based rate (including SOFR, a term SOFR or any other
rate based upon SOFR) as a benchmark rate (and such syndicated credit facilities are identified in such notice and are publicly
available for review), and
(2) the joint election by the Administrative Agent and the Borrower to trigger a fallback from USD LIBOR and the
provision by the Administrative Agent of written notice of such election to the Lenders.
“Earnouts” means (a) all earnout payments or other contingent payments in connection with any Permitted Investment and (b)
Existing Earnouts and Unfunded Holdbacks.
“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which
is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an
institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a
subsidiary of an institution described in clause (a) or (b) of this definition and is subject to consolidated supervision with its parent.
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“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative
authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Eligible Accounts Receivable” means, at any time, all Accounts due to any Loan Party arising from the sale of goods of the
Loan Parties or the provision of services by one or more Loan Parties, minus any finance charges, late fees and other fees that are unearned,
sales, GST, excise or similar taxes, and credits or allowances granted at such time; provided that Eligible Accounts Receivable shall not
include any Account (without duplication of any Reserves established in accordance with Section 2.22):
(a)
which is not subject to a first priority perfected security interest in favor of the Administrative Agent (other
than Permitted Liens arising by operation of law and having priority by applicable Law (without limiting the ability of the
Administrative Agent to change, establish or eliminate any Reserves in its Permitted Discretion on account of any such Permitted
Lien);
(b)
with respect to which (a) more than 120 days have elapsed from the original invoice date thereof (or, in the
case of Accounts owing from Kimberly-Clark Corporation, Kimberly Clark Global Sales LLC and The Proctor and Gamble
Company, more than 150 days have elapsed from the original invoice date) or (b) which is more than 60 days past due after the
original due date
(c)
which is owing by an Account Debtor for which 50.0% or more of the Accounts owing from such Account
Debtor and its Affiliates are ineligible pursuant to clause (b) above;
(d)
which is owing by an Account Debtor to the extent the aggregate amount of Accounts owing from such
Account Debtor and its Affiliates to the Loan Parties exceeds 20.0% (or such higher percentage as the Administrative Agent may
establish from time to time in its Permitted Discretion) of the aggregate Eligible Accounts Receivable;
(e)
which does not conform in all material respects to the representations and warranties in respect of Accounts
contained in this Agreement or in the Security Agreement (or the Canadian Security Agreement, as applicable);
(f)
which (i) does not arise from the sale of goods or performance of services in the ordinary course of business,
(ii) represents a progress billing, (iii) is contingent upon the Loan Parties’ completion of any further performance, (iv) represents a
sale on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment, cash-on-delivery or any other repurchase
or return basis, (v) relates to payments of interest, fees or late charges (but any resulting ineligibility shall be limited to the extent
of such payments), (vi) is not invoiced or evidenced by other documentation reasonably satisfactory to the Administrative Agent
(in its Permitted Discretion) which has been sent to the Account Debtor, (vii) which is a duplicate invoice or (viii) relates to a sale
to a Person for personal, family or household purposes;
(g)
which is owed by an Account Debtor which has (i) applied for, suffered, or consented to the appointment of
any receiver, interim receiver, monitor, custodian, trustee or liquidator of its assets, (ii) had possession of all or a material part of
its property taken by any receiver, interim receiver, monitor, custodian, trustee or liquidator, (iii) filed, or had filed against it, any
request or petition for liquidation, reorganization, arrangement, receivership, adjustment of
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debts, adjudication as bankrupt, winding-up, or voluntary or involuntary case or proceeding under the Bankruptcy Code or any
other Debtor Relief Laws, (iv) admitted in writing its inability, or is generally unable to, pay its debts as they become due, (v)
become insolvent, or (vi) ceased operation of its business, unless, in the case of clauses (g)(iii) through (g)(vi) above, such
Account Debtor has caused the issuance of a letter of credit in favor of the applicable Loan Party fully securing the payment of
such Account, which letter of credit is reasonably satisfactory to the Administrative Agent;
(h)
which is owed by any Account Debtor which has sold all or substantially all of its assets, unless such
Account Debtor has caused the issuance of a letter of credit in favor of the applicable Loan Party fully securing the payment of
such Account, which letter of credit is reasonably satisfactory to the Administrative Agent;
(i)
which is owed by an Account Debtor which (i) does not maintain its chief executive office in the U.S. or
Canada or (ii) is not organized under applicable Law of the U.S. or Canada or any state or province thereof unless, in any case,
such Account is (x) backed by a letter of credit reasonably acceptable to the Administrative Agent which is in the possession of,
has been assigned to and is directly drawable by the Administrative Agent or (y) covered by credit insurance reasonably
acceptable to the Administrative Agent; provided that up to $15 million of Accounts owing from Account Debtors located in the
United Kingdom, Ireland, Netherlands and Germany may be eligible without satisfying the foregoing requirement for a letter of
credit or credit insurance;
(j)
which is owed in any currency other than U.S. Dollars or Canadian dollars;
(k)
Accounts in an aggregate amount exceeding $1,000,000 which are owed by (i) the government (or any
department, agency, public corporation or instrumentality thereof) of any country other than the U.S. or Canada unless such
Account is (x) backed by a letter of credit reasonably acceptable to the Administrative Agent and, if requested by the
Administrative Agent, which is in the possession of the Administrative Agent or (y) covered by credit insurance reasonably
acceptable to the Administrative Agent, or (ii) the government of the U.S. or any Canadian federal, provincial or territorial
Governmental Authority, or any department, agency, public corporation or instrumentality thereof, unless the Federal Assignment
of Claims Act of 1940, as amended (31 U.S.C. § 3727 et seq. and 41 U.S.C. § 15 et seq.) or the Financial Administration Act
(Canada) or similar applicable Law, as amended, has been complied with;
(l)
which is owed by any Affiliate, employee, officer, director, agent or stockholder of any Loan Party;
(m)
which is owed by an Account Debtor or any Affiliate of such Account Debtor to which any Loan Party is
indebted, including for exclusivity contract payments (but only to the extent of such indebtedness) or is subject to any security,
deposit, progress payment, retainage or other similar advance made by or for the benefit of an Account Debtor, in each case only
to the extent thereof;
(n)
which has been short-paid or is subject to any chargeback, counterclaim, deduction, defense, setoff, rebate
paid or to be paid or dispute notice of which is provided to the Borrower or any of its Subsidiaries but only to the extent of any
such counterclaim, deduction, defense, setoff, rebate or dispute; provided that no Account that otherwise constitutes an Eligible
Accounts Receivable shall be rendered ineligible by virtue of this clause (n) to the extent, but only
33
to the extent, that the Account Debtor’s right of setoff is limited by an enforceable agreement that is reasonably satisfactory to the
Administrative Agent;
(o)
(p)
which is evidenced by any promissory note, chattel paper or instrument;
which does not comply in all material respects with the requirements of all applicable Laws and regulations,
whether federal, state, provincial, territorial, municipal, local or foreign;
(q)
for which (i) the goods giving rise to such Account have not been shipped and billed to the Account Debtor
or (ii) the services giving rise to such Account have not been performed and billed to the Account Debtor;
(r)
which has been identified by any Loan Party to be at risk, subject to a legal payment plan or deemed
uncollectable;
(s)
which is an Account of an Account Debtor who has any Accounts with a Loan Party or any Restricted
Subsidiary subject to a supply chain or factoring arrangement (including any Qualified Securitization Financing); or
(t)
any Account with respect to which the Administrative Agent shall not have received or prepared a Report in
respect of such Account, which Report shows results reasonably satisfactory to the Administrative Agent; it being agreed that, in
connection with any acquisition permitted hereunder where the Acquired Borrowing Base (as defined below) exceeds $20 million,
the Administrative Agent shall take such actions as are reasonably required to obtain or prepare such a Report within 90 days of
such acquisition of such Account (which Report shall be at the expense of the Borrower and shall not be considered to be any
limitation on field examinations and inventory appraisals at the expense of the Borrower provided in Section 6.10(b)) promptly
upon the request of the Borrower; provided that, subject to the immediately following proviso, until the earlier of (x) the date on
which the Administrative Agent receives a Report in respect of such Accounts showing results reasonably satisfactory to it and (y)
solely with respect to Accounts in connection with any acquisition permitted hereunder where the Acquired Borrowing Base (as
defined below) exceeds $20 million, the date that is 90 days after the acquisition thereof, such Accounts shall constitute Eligible
Accounts Receivable; provided, further, if the inclusion of all Accounts acquired pursuant to any acquisition permitted hereunder,
together with the inclusion of any inventory subject to a similar limitation pursuant to clause (xiv) of the definition of “Eligible
Inventory” (collectively, the “Acquired Borrowing Base”) would, in the aggregate, cause the Borrowing Base in respect of such
Accounts and Inventory (the “Post-Acquisition Borrowing Base”) to exceed 20% of the Borrowing Base in existence at such
time prior to giving effect to such acquisition (the “Pre-Acquisition Borrowing Base”), then this clause (t) shall exclude all such
Accounts to the extent such Accounts would cause the Post-Acquisition Borrowing Base to exceed 20% of the Pre-Acquisition
Borrowing Base.
“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 11.07(b)(v); provided that the
following Persons shall not be Eligible Assignees: (a) any Defaulting Lender and (b) any Person that is a Disqualified Lender.
“Eligible Credit Insured Accounts” means Eligible Accounts Receivable (valued at the maximum insured amounts thereof,
taking into account any deductibles, hold backs and reserves) that are insured as to credit risk by a nationally recognized credit insurer
acceptable to the Administrative Agent,
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in its Permitted Discretion, on terms and conditions likewise acceptable to the Administrative Agent, in its Permitted Discretion.
“Eligible Inventory” means, at any time, all Inventory of the Loan Parties; provided that Eligible Inventory shall not include any
Inventory (without duplication of any Reserves established in accordance with Section 2.22):
(i)
which is not subject to a first priority perfected Lien in favor of the Administrative Agent (other
than a Landlord Lien as to which a Landlord Lien Reserve applies and other than Permitted Liens arising by operation
of law and having priority by applicable law (without limiting the ability of the Administrative Agent to change,
establish or eliminate any Reserves in its Permitted Discretion in respect of such Permitted Liens));
(ii)
which is unmerchantable, damaged, defective, obsolete, slow-moving, unfit for sale, returned or
rejected;
(iii)
which does not conform in all material respects to the representations and warranties in respect of
Inventory contained in this Agreement or the Security Agreement;
(iv)
(v)
which is not owned only by one or more Loan Parties;
which constitutes packaging or supplies dedicated for internal use in the Loan Parties’ business or
bill-and-hold goods (but excluding spare parts);
(vi)
which is not located in the U.S. or Canada or is in transit with a common carrier from vendors or
suppliers (other than Inventory in-transit between locations of any Loan Party in the U.S. or Canada);
(vii)
which is located at any location leased by a Loan Party, unless (i) the lessor has delivered to the
Administrative Agent a Collateral Access Agreement as to such location or (ii) a Landlord Lien Reserve with respect to
such location has been established in accordance with Section 2.22;
(viii)
which is located in any third party warehouse or is in the possession of a bailee (other than a
third party processor) and is not evidenced by a Document, unless (i) such warehouseman or bailee has delivered to the
Administrative Agent a Collateral Access Agreement and such other documentation as the Administrative Agent may
reasonably require or (ii) a Landlord Lien Reserve has been established in accordance with Section 2.22);
(ix)
(x)
(xi)
which is being processed offsite by a third party at a third party location or outside processor;
which is the subject of a consignment by any Loan Party as consignor or consignee;
it is the subject of a bill of lading or other document of title;
(xii)
which contains or bears any company-specific labels, branded ticks, or intellectual property rights
licensed to any Loan Party pursuant to a license with any Person other than a Loan Party unless the Administrative
Agent may sell or otherwise dispose of
35
such Inventory without (i) infringing the rights of such licensor, (ii) violating any contract with such licensor, or (iii)
incurring any liability with respect to payment of royalties other than royalties incurred pursuant to sale of such
Inventory under the current licensing agreement relating thereto; provided that the foregoing shall not apply to any
Inventory with company-specific labels, branded ticks or intellectual property rights of Staples, Office Depot or other
similar brands, subject to a Reserve for any repackaging costs as required by the relevant contractual arrangements with
Staples and Office Depot or such other party;
(xiii)
[reserved]; or
(xiv)
any Inventory with respect to which the Administrative Agent shall not have received or prepared
a Report in respect of such Inventory, which Report shows results reasonably satisfactory to the Administrative Agent;
it being agreed that in connection with any acquisition permitted hereunder where the Acquired Borrowing Base
exceeds $40 million, the Administrative Agent shall take such actions as are reasonably required to obtain or prepare
such a Report within 90 days of such acquisition of such Inventory (which Report shall be at the expense of the
Borrower and shall not be considered in any limitation on field examinations or inventory appraisals at the expense of
the Borrower provided in Section 6.10(b)) promptly upon the request of any Loan Party; provided that, subject to the
immediately following proviso, until the earlier of (x) the date on which the Administrative Agent receives a Report in
respect of such Inventory showing results reasonably satisfactory to it and (y) solely with respect to Inventory in
connection with any acquisition permitted hereunder where the Acquired Borrowing Base exceeds $20 million, the date
that is 90 days after the acquisition thereof, such Inventory shall constitute Eligible Inventory; provided, further, if the
inclusion of the Acquired Borrowing Base would, in the aggregate, cause the Post-Acquisition Borrowing Base to
exceed 20% of the Pre-Acquisition Borrowing Base, then this clause (xiv) shall exclude all such Inventory to the extent
such Inventory would cause the Post-Acquisition Borrowing Base to exceed 20% of the Pre-Acquisition Borrowing
Base.
“EMU” means the Economic and Monetary Union as contemplated in the EU Treaty.
“EMU Legislation” means the legislative measures of the EMU for the introduction of, changeover to, or operation of the Euro in
one or more member states.
“Environmental Claim” means any and all administrative, regulatory or judicial actions, suits, demands, demand letters, claims,
liens, notices of noncompliance or violation, investigations by any Governmental Authority, or proceedings with respect to any
Environmental Liability or pursuant to Environmental Law, including those (a) by any Governmental Authority for enforcement, cleanup,
removal, response, remedial or other actions or damages pursuant to any Environmental Law and (b) by any Person seeking damages,
contribution, indemnification, cost recovery, compensation or injunctive relief pursuant to any Environmental Law.
“Environmental Laws” means any and all Laws relating to the protection of the environment or, to the extent relating to exposure
to Hazardous Materials, human health.
“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of
environmental remediation, fines, penalties or indemnities) of any Loan Party or any of the Restricted Subsidiaries directly or indirectly
resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any
36
Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect
to any of the foregoing.
“Environmental Permit” means any permit, approval, identification number, license or other authorization required under or
issued pursuant to any Environmental Law.
“Equity Contribution” means, the direct or indirect contribution (including pursuant to a merger) to the Initial Borrower (or a
direct or indirect parent thereof) by Jackson Wijaya, and other co-investors in exchange for common equity of the Initial Borrower (or such
direct or indirect parent). Any such parent will contribute, or cause to be contributed, all such cash and equity to the Initial Borrower
substantially simultaneously with (or prior to) the funding of the Term Loan Facility, the Initial Revolving Loans and the Senior Secured
Notes. The aggregate amount of the Equity Contribution will represent not less than 45% (the “Minimum Equity Contribution”) of the
sum of (i) the aggregate principal amount of the Initial Revolving Loans funded under this Agreement on the Closing Date, other than letters
of credit and amounts borrowed to cash collateralize letters of credit or to fund certain OID or upfront fees, (ii) the aggregate principal
amount of the Initial Term Loans funded on the Closing Date under the Term Loan Credit Agreement, (iii) the aggregate principal amount of
Senior Secured Notes issued under the Senior Secured Notes Indenture on the Closing Date (other than amount held in escrow on the Closing
Date to fund repurchases of the Existing Notes after the Closing Date), (iv) the aggregate amount of Existing Notes that are not repurchased,
redeemed, defeased or satisfied and discharged on or prior to the Closing Date and (v) the cash amounts of the Minimum Equity
Contribution, in each case, on the Closing Date; provided, further that Jackson Wijaya shall directly or indirectly control at least a majority of
the ordinary voting power of Holdings after giving effect to the Transactions.
“Equity Interests” means, with respect to any Person, all of the shares, interests, rights, participations or other equivalents
(however designated) of capital stock of (or other ownership or profit interests or units in, including any limited or general partnership
interest and any limited liability company membership interest) such Person and all of the warrants, options or other rights for the purchase,
acquisition or exchange from such Person of any of the foregoing (including through convertible securities).
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and
regulations promulgated thereunder.
“ERISA Affiliate” means any trade or business (whether or not incorporated) that together with any Loan Party is treated as a
single employer within the meaning of Section 414 of the Code or Section 4001 of ERISA. For the avoidance of doubt, when any provision
of this Agreement relates to a past event or period of time, the term “ERISA Affiliate” includes any Person who was, as to the time of such
past event or period of time, an ERISA Affiliate within the meaning of the preceding sentence.
“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by any Loan Party or any of their
respective ERISA Affiliates from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by any Loan Party or any of their respective ERISA Affiliates from a Multiemployer Plan,
written notification of any Loan Party or any of their respective ERISA Affiliates concerning the imposition of Withdrawal Liability or
written notification that a Multiemployer Plan is insolvent within the meaning of Title IV of ERISA; (d) the filing under Section 4041(c) of
ERISA of a notice of intent to terminate a Pension Plan, the treatment of a Pension Plan or Multiemployer Plan amendment as a termination
under Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer
Plan; (e) the imposition of any
37
liability under Title IV of ERISA, other than for the payment of plan contributions or PBGC premiums due but not delinquent under
Section 4007 of ERISA, upon any Loan Party or any of their respective ERISA Affiliates; (f) the failure to satisfy the minimum funding
standards (within the meaning of Section 412 of the Code or Section 302 of ERISA) with respect to any Pension Plan; (g) the application for
a minimum funding waiver under Section 302(c) of ERISA with respect to a Pension Plan; (h) the imposition of a lien under Section 303(k)
of ERISA with respect to any Pension Plan or (i) a determination that any Pension Plan is in “at risk” status (within the meaning of
Section 303 of ERISA).
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or
any successor person), as in effect from time to time.
“EU Treaty” means the Treaty on European Union.
“Euro” and “€” mean the single currency of the Participating Member States introduced in accordance with the provisions of
Article 109(i)4 of the EU Treaty.
“Eurocurrency Rate” means:
(a)
for any Interest Period with respect to a Eurocurrency Rate Loan denominated in Dollars, the rate per annum
equal to (i) the ICE LIBOR Rate (“ICE LIBOR”), as published on the applicable Thomson Reuters screen page (or such other
commercially available source providing quotations of ICE LIBOR as may be designated by the Administrative Agent from time
to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for
Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period or (ii) subject to
Section 11.01, if such rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent
to be the rate at which deposits in Dollars for delivery on the first day of such Interest Period in Same Day Funds in the
approximate amount of the Eurocurrency Rate Loan being made, continued or converted and with a term equivalent to such
Interest Period would be offered by the Administrative Agent to major banks in the London interbank eurodollar market at their
request at approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period;
(b)
for any Interest Period with respect to a Eurocurrency Rate Loan denominated in Canadian Dollars, the rate
per annum equal to the CDOR Rate;
(c)
for any interest calculation with respect to a Base Rate Loan denominated in Dollars on any date, the rate per
annum equal to (i) ICE LIBOR, at approximately 11:00 a.m., London time determined two Business Days prior to such date for
Dollar deposits being delivered in the London interbank market for a term of one month commencing that day or (ii) if such
published rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the
rate at which deposits in Dollars for delivery on the date of determination in Same Day Funds in the approximate amount of the
Base Rate Loan being made or maintained and with a term equal to one month would be offered by the Administrative Agent to
major banks in the London interbank eurodollar market at their request at the date and time of determination.
“Eurocurrency Rate Loan” means a Loan, whether denominated in Dollars, Canadian Dollars or any Alternative Currency, that
bears interest at a rate based on clause (a) or (b), as applicable, of the definition of “Eurocurrency Rate.”
“Event of Default” has the meaning specified in Section 9.01.
38
“Excess Availability” shall mean, at any time without duplication, the remainder of:
(a)
(b)
the Line Cap at such time, minus
the sum of the Total Utilization of Revolving Commitments of all Lenders at such time.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Exchange Rate” means, on any date with respect to any currency, the rate at which such currency may be exchanged into any
other currency, as set forth at approximately 11:00 a.m., London time, on such date on the applicable Bloomberg page for such currency. In
the event that such rate does not appear on any Bloomberg page, the Exchange Rate shall be determined by reference to such other publicly
available service for displaying the exchange rates as may be selected by the Administrative Agent, or, in the event no such service is
selected, such Exchange Rate shall instead be the arithmetic average of the spot rates of exchange of the Administrative Agent in the market
where its foreign currency exchange operations in respect of such currency are then being conducted, at or about 10:00 a.m., local time, on
such date for the purchase of the relevant currency for delivery two Business Days later; provided that, if at the time of any such
determination, for any reason no such spot rate is being quoted, the Administrative Agent, after consultation with the Borrower, may use any
reasonable method that it deems appropriate to determine such rate, and such determination shall be presumed correct absent manifest error.
“Excluded Accounts” means deposit accounts (a) established (or otherwise maintained) by the Loan Parties that do not have cash
balances at any time exceeding $5,000,000 in the aggregate for all such accounts, (b) solely containing cash allocated as proceeds of the sale
of Term Priority Collateral pursuant to the Closing Date ABL Intercreditor Agreement, (c) any Trust Fund Account, (d) used by the Loan
Parties exclusively for disbursements and payments (including payroll) in the ordinary course of business, (e) that are zero balance accounts;
provided that the available balance of each such account is automatically swept on each Business Day into another account that is subject to a
Blocked Account Agreement if such other account does not provide for an automatic payments to, or debit of amounts disbursed from, other
accounts that are not subject to Blocked Account Agreements, (f) subject to a Lien permitted under Section 7.01(oo) or (g) that are located
outside of the United States and Canada (other than any such deposit account containing the proceeds of a sale of ABL Priority Collateral).
“Excluded Asset” has the meaning specified in the Security Agreement or the Canadian Security Agreement, as applicable.
“Excluded Equity Interests” has the meaning specified in the Security Agreement or the Canadian Security Agreement, as
applicable.
“Excluded Subsidiary” means:
(a)
(b)
any Subsidiary that is not a wholly owned Subsidiary of a Loan Party;
any Foreign Subsidiary (other than a Canadian Subsidiary) of the Borrower or of any direct or indirect
Domestic Subsidiary or Foreign Subsidiary (other than a Canadian Subsidiary);
(c)
any FSHCO;
39
(d)
any Domestic Subsidiary that is a direct or indirect Subsidiary of a Foreign Subsidiary (other than a Canadian
Subsidiary) that is a CFC;
(e)
any Subsidiary that is prohibited or restricted by applicable Law from providing a Guaranty or by a binding
contractual obligation existing on the Closing Date or at the time of the acquisition of such Subsidiary (and not incurred in
contemplation of such acquisition) from providing a Guaranty (provided that such contractual obligation is not entered into by the
Borrower or its Restricted Subsidiaries principally for the purpose of qualifying as an “Excluded Subsidiary” under this definition)
or if such Guaranty would require governmental (including regulatory) or third party (other than Holdings, the Borrower or a
Restricted Subsidiary) consent, approval, license or authorization, unless such consent, approval, license or authorization has been
obtained;
(f)
any special purpose securitization vehicle (or similar entity) including any Securitization Subsidiary created
pursuant to a transaction permitted under this Agreement;
(g)
(h)
any Subsidiary that is a not-for-profit organization;
any Captive Insurance Subsidiary;
(i)
any other Subsidiary with respect to which, as reasonably determined by the Borrower in good faith and in
consultation with the Administrative Agent, the cost or other consequences (including any material adverse tax consequences) of
providing the Guaranty shall be excessive in view of the benefits to be obtained by the Lenders therefrom;
(j)
any other Subsidiary to the extent the provision of a Guaranty by such Subsidiary would result in material
adverse tax consequences to Holdings (or any Parent Entity to the extent such material adverse tax consequences are related to its
ownership of the Equity Interests in Holdings or the Borrower and its Restricted Subsidiaries), the Borrower or any of the
Restricted Subsidiaries as reasonably determined by the Borrower in good faith in consultation with the Administrative Agent;
(k)
(l)
any Unrestricted Subsidiary; and
any Immaterial Subsidiary;
provided that the Borrower, in its sole discretion, may cause any Restricted Subsidiary that is a Domestic Subsidiary or a Canadian
Subsidiary that qualifies as an Excluded Subsidiary under clauses (a) through (l) above to become a Guarantor in accordance with the
definition thereof (subject to completion of any requested “know your customer” and similar requirements of the Administrative Agent) and
thereafter such Subsidiary shall not constitute an “Excluded Subsidiary” (unless and until the Borrower elects, in its sole discretion, to
designate such Persons as an Excluded Subsidiary).
“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a
portion of the Guaranty of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any
Guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures
Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to
constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to any keepwell,
support or other agreement for the benefit of such Guarantor and any and all guarantees of such Guarantor’s Swap Obligations by other Loan
Parties) at the time the Guaranty of such Guarantor, or a grant by such Guarantor of a security interest, becomes effective with
40
respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall
apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guaranty or security interest is or becomes
excluded in accordance with the first sentence of this definition.
“Excluded Taxes” has the meaning specified in Section 3.01(a).
“Existing Credit Documents” means (1) that certain Third Amended and Restated Credit Agreement, dated as of August 22,
2018, by and among Domtar Corporation, Domtar Inc., Domtar Pulp and Paper General Partnership, the additional borrowers from time to
time parties thereto, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the other agents
named therein (as amended, amended and restated, supplemented, restructured or otherwise modified, renewed or replaced from time to time)
and (2) that certain receivables securitization facility provided under (i) that certain Third Amended and Restated Receivables Transfer
Agreement, dated as of February 12, 2016, by and among Domtar Funding Limited Liability Company, Domtar Corporation, Liberty Street
Funding LLC and The Bank of Nova Scotia, (ii) that certain Amended and Restated Purchase and Sale Agreement, dated as of November 14,
2011, by and among the originators as named therein, Domtar Funding Limited Liability Company and Domtar Corporation and (iii) that
certain Performance Guaranty, dated as of March 7, 2007, by and among Domtar Corporation, Liberty Street Funding LLC and The Bank of
Nova Scotia and (as amended, amended and restated, supplemented, restructured or otherwise modified, renewed or replaced from time to
time).
“Existing Earnouts and Unfunded Holdbacks” means those earnouts and unfunded holdbacks existing on the Closing Date.
“Existing Indebtedness” has the meaning specified in the preliminary statements to this Agreement.
“Existing Letter of Credit” has the meaning specified in Section 2.04(j).
“Existing Notes” means all senior notes issued and outstanding under that certain Indenture (together with each supplemental
indenture entered into thereunder, the “Existing Notes Indenture”), dated as of November 19, 2007, among Domtar Corporation, the
subsidiary guarantors party thereto and The Bank of New York Bellow (as successor to The Bank of New York), as trustee.
“Extended Commitments” means Extended Revolving Commitments.
“Extended Loans” means Extended Revolving Loans.
“Extended Revolving Commitments” means the Revolving Commitments held by an Extending Lender.
“Extended Revolving Loans” means the Revolving Loans made pursuant to Extended Revolving Commitments.
“Extending Lender” means each Lender accepting an Extension Offer.
“Extension” has the meaning specified in Section 2.18(a).
“Extension Amendment” has the meaning specified in Section 2.18(b).
41
“Extension Offer” has the meaning specified in Section 2.18(a).
“Facility” means the Tranche 1 Revolving Loans, the Tranche 2 Revolving Loans, the Swing Line Loans, Extended Revolving
Commitments or any Extended Revolving 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 version
that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations
thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices
adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities implementing such Sections of
the Code.
“FCA” has the meaning specified in Section 11.01(f).
“FCPA” means the United States Foreign Corrupt Practices Act of 1977, as amended or modified from time to time.
“Federal Funds Rate” means, for any day, the rate calculated by the Federal Reserve Bank of New York based on such day’s
federal funds transactions by depository institutions (as determined in such manner as the Federal Reserve Bank of New York shall set forth
on its public website from time to time) and published on the next succeeding Business Day by the Federal Reserve Bank of New York as the
federal funds effective rate; provided that if the Federal Funds Rate for any day is less than zero, the Federal Funds Rate for such day will be
deemed to be zero.
“Financial Covenant” means any covenant that requires compliance with any measurement of financial or operational
performance (including any leverage, interest coverage or fixed charge ratio or minimum EBITDA.
“Financial Covenant Event of Default” has the meaning specified in Section 9.01(b).
“First Lien Net Leverage Ratio” means, with respect to any Test Period, the ratio of (a) Consolidated Secured Net Debt under (i)
this Agreement, (ii) the Senior Secured Notes, (iii) any Pari Passu Lien Debt, (iv) the Term Loan Facility and (v) Indebtedness secured on a
pari passu basis with the Obligations on the ABL Priority Collateral, in each case, outstanding as of the last day of such Test Period to
(b) Consolidated Adjusted EBITDA of the Borrower for such Test Period.
“Fixed Charge Coverage Ratio” means, as of any date, the ratio of:
(a) (i) Consolidated Adjusted EBITDA for the Test Period ended as of such date or, as applicable, most recently ended prior to
such date, less
(ii) the aggregate amount of federal, state, local and foreign income taxes paid or payable in cash for the Test Period ended as of
such date or, as applicable, most recently ended prior to such date, less
(iii) Non-Financed Capital Expenditures for the Test Period that were paid in cash during such Test Period, to
(b) Fixed Charges for the Test Period as of such date.
“Fixed Charges” means, with respect to any Test Period, without duplication, the sum of (a) Consolidated Cash Interest Expense
plus (b) the aggregate amount of scheduled principal payments in
42
respect of Indebtedness for borrowed money of the Borrower and its Restricted Subsidiaries paid in cash during such period (other than
payments made by the Borrower or any Restricted Subsidiary to the Borrower or any Restricted Subsidiary), plus (c) solely for the purpose of
testing the satisfaction of the Payment Conditions in connection with a Restricted Payment, cash dividends paid in cash during such period
pursuant to Section 7.06(r).
“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the execution of this Agreement, the
modification, amendment or renewal of this Agreement or otherwise) with respect to USD LIBOR.
“Foreign Lender” has the meaning specified in Section 3.01(b).
“Foreign Plan” means any material employee benefit plan, program or agreement maintained or contributed to by, or entered into
with, Holdings or any Restricted Subsidiary of Holdings with respect to employees employed outside the United States and Canada (other
than benefit plans, programs or agreements that are mandated by applicable Laws).
“Foreign Subsidiary” means any direct or indirect Subsidiary of the Borrower that is not a Domestic Subsidiary.
“FRB” means the Board of Governors of the Federal Reserve System of the United States.
“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with respect to the Issuing Banks, such Defaulting
Lender’s Pro Rata Share of the outstanding Letters of Credit Obligations other than such Obligations as to which such Defaulting Lender’s
participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof and (b) with respect
to the Swing Line Lender, such Defaulting Lender’s Pro Rata Share of the outstanding Obligations with respect to Swing Line Loans
extended by the Swing Line Lender other than such Obligations as to which such Defaulting Lender’s participation obligation has been
reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof.
“FSHCO” means any direct or indirect Domestic Subsidiary of Holdings (other than the Borrower or any Co-Borrower) that has
no material assets other than Equity Interests (or Equity Interests and Indebtedness) in one or more Foreign Subsidiaries (unless all such
Foreign Subsidiaries are Canadian Loan Parties) that are CFCs or other FSHCOs.
“Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course.
“GAAP” means generally accepted accounting principles in the United States, as in effect from time to time; provided however
that if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision of a Loan Document to
eliminate the effect of any change occurring after the Closing Date in GAAP or in the application thereof (including through the adoption of
IFRS) on the operation of such provision (or if the Administrative Agent notifies the Borrower that the Required Lenders request an
amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such change in GAAP or
in the application thereof (including through the adoption of IFRS), then such provision shall be interpreted on the basis of GAAP as in effect
and applied immediately before such change shall have become effective until such notice shall have been withdrawn or such provision
amended in accordance herewith.
“General Asset Sale Basket” has the meaning specified in Section 7.05(j).
43
“Global Intercompany Note” means a promissory note substantially in the form of Exhibit H executed by Holdings, the
Borrower and each wholly owned Restricted Subsidiary.
“Governmental Authority” means the government of the United States, Canada or any other nation, or of any political
subdivision thereof, whether state, provincial, territorial, municipal or local, and any agency, authority, instrumentality, regulatory body,
court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government (including any supra-national bodies such as the European Union or the European Central Bank).
“Grant Event” means the occurrence of any of the following:
(a)
Subsidiary);
the formation or acquisition by a Loan Party of a new wholly owned Subsidiary (other than an Excluded
(b)
the designation in accordance with Section 6.13 of a wholly owned Subsidiary (other than an Excluded
Subsidiary) of any Loan Party as a Restricted Subsidiary;
(c)
(d)
any Person (other than an Excluded Subsidiary) becoming a wholly owned Subsidiary of a Loan Party;
any wholly owned Restricted Subsidiary of a Loan Party ceasing to be an Excluded Subsidiary; or
(e)
“Excluded Subsidiary”.
the designation of any Restricted Subsidiary as a Guarantor pursuant to the proviso in the definition of
“Granting Lender” has the meaning specified in Section 11.07(g).
“GST” means all amounts payable under the Excise Tax Act (Canada) or any similar legislation in any other jurisdiction of
Canada, including Quebec sales tax imposed pursuant to an Act respecting the Québec sales tax and “HST” means all amounts payable as
harmonized sales tax in the Provinces of Ontario, Nova Scotia, Newfoundland, New Brunswick and Prince Edward Island under the Excise
Tax Act (Canada).
“Guarantee” means, as to any Person, without duplication, (a) any obligation, contingent or otherwise, of such Person
guaranteeing or having the economic effect of guaranteeing any Indebtedness or other monetary obligation payable or performable by
another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other monetary obligation,
(ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other
monetary obligation of the payment or performance of such Indebtedness or other monetary obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the
primary obligor to pay such Indebtedness or other monetary obligation, or (iv) entered into for the purpose of assuring in any other manner
the obligee in respect of such Indebtedness or other monetary obligation of the payment or performance thereof or to protect such obligee
against loss in respect thereof (in whole or in part), or (b) any Lien (other than a Permitted Lien) on any assets of such Person securing any
Indebtedness or other monetary obligation of any other Person, whether or not such Indebtedness or other monetary obligation is assumed by
such Person (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien); provided that the term
“Guarantee” shall not include
44
endorsements for collection or deposit, in either case in the ordinary course of business or customary, Permitted Liens, and reasonable
indemnity obligations in effect on the Closing Date or entered into in connection with any acquisition or disposition of assets permitted under
this Agreement (other than such obligations with respect to Indebtedness). The amount of any Guarantee shall be deemed to be an amount
equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made
or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in
good faith. The term “Guarantee” as a verb has a corresponding meaning.
“Guarantors” means Holdings and each Restricted Subsidiary that executed a counterpart to the Guaranty (or a joinder thereto)
on the Closing Date or thereafter pursuant to Section 6.11, in each case, other than any Excluded Subsidiaries.
“Guaranty” means (a) the guaranty made by Holdings and the other Guarantors in favor of the Administrative Agent on behalf of
the Secured Parties substantially in the form of Exhibit E and (b) each other guaranty and guaranty supplement delivered pursuant to
Section 6.11.
“Guaranty Release Event” has the meaning specified in Section 10.11(a)(i)(I).
“Guaranty Supplement” means the “ABL Guarantee Supplement” as defined in the Guaranty.
“Hazardous Materials” means any hazardous or toxic chemicals, materials, substances or waste which is listed, classified or
regulated by any Governmental Authority as “hazardous substances,” “hazardous wastes,” “hazardous materials,” “extremely hazardous
wastes,” “restricted hazardous wastes,” “toxic substances,” “toxic wastes,” “contaminants” or “pollutants,” or words of similar import, under
any Environmental Law, including petroleum or petroleum products (including gasoline, crude oil or any fraction thereof), asbestos or
asbestos-containing materials, polychlorinated biphenyls, radon gas and urea formaldehyde.
“Hedge Agreement” means any agreement with respect to (a) any and all rate swap transactions, basis swaps, credit derivative
transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions,
interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap
transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of
any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject
to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any
International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related
schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.
“Hedge Bank” means any Person that is an Agent, a Lender, a Lead Arranger or an Affiliate or branch of any of the foregoing on
the Closing Date (with respect to any Secured Hedge Agreement entered into on or prior to the Closing Date) or at the time it enters into a
Secured Hedge Agreement, in its capacity as a party thereto, whether or not such Person subsequently ceases to be an Agent, a Lender, a
Lead Arranger or an Affiliate or branch of any of the foregoing.
“HMT” means Her Majesty’s Treasury of the United Kingdom.
45
“Holdings” has the meaning specified in the preliminary statements to this Agreement, together with its successors and assigns
permitted hereunder.
“IBA” has the meaning specified in Section 11.01(f).
“ICE LIBOR” means the London Interbank Offered Rate set by ICE Benchmark Administration Limited.
“Identified Transaction” has the meaning specified in Section 10.11(c).
“IFRS” means International Financial Reporting Standards and applicable accounting requirements set by the International
Accounting Standards Board or any successor thereto (or the Financial Accounting Standards Board, the Accounting Principles Board of the
American Institute of Certified Public Accountants, or any successor to either such Board, or the SEC, as the case may be), as in effect from
time to time.
“Immaterial Subsidiary” means any Restricted Subsidiary of the Borrower other than a Material Subsidiary.
“Impacted Loans” has the meaning specified in Section 3.03.
“Increased Amount” means, in the case of any Indebtedness, any increase in the amount of such Indebtedness in connection with
any accrual of interest, the accretion of accreted value, the amortization of original issue discount or deferred financing fees, the payment of
interest or dividends in the form of additional Indebtedness or in the form of Equity Interests, as applicable, the accretion of original issue
discount, deferred financing fees or liquidation preference and increases in the amount of Indebtedness outstanding solely as a result of
fluctuations in the exchange rate of currencies.
“Incremental Amendment” has the meaning specified in Section 2.16(e).
“Incremental Amount” means the greater of (i) the greater of (a) 50% of Closing Date EBITDA and (b) 50% of TTM
Consolidated Adjusted EBITDA calculated on a Pro Forma Basis and (ii) the excess of the Borrowing Base then in effect at the time over the
aggregate amount of Commitments then in effect at the time of the effectiveness of such Incremental Amendment.
“Incremental Equivalent Debt” has the meaning assigned to such term in the Term Loan Credit Agreement (as in effect on the
date hereof).
“Incremental Facility” has the meaning specified in Section 2.16(a).
“Incremental Loans” has the meaning specified in Section 2.16(a).
“Incremental Revolving Facilities” has the meaning specified in Section 2.16(a).
“Incremental Revolving Facility Lender” has the meaning specified in Section 2.16(i).
“Incremental Revolving Loans” has the meaning specified in Section 2.16(a).
“Indebtedness” means, with respect to any Person, without duplication,
(a)
any indebtedness (including principal or premium) of such Person in respect of borrowed money; any
indebtedness evidenced by bonds, notes, debentures, loan agreements or
46
similar instruments; letters of credit or bankers’ acceptances (or, without double counting, reimbursement agreements in respect
thereof), and Capitalized Lease Obligations or the balance deferred and unpaid of the purchase price of any property to the extent
that the same would be required to be shown as a long-term liability on the balance sheet for such Person prepared in accordance
with GAAP;
(b)
(i) to the extent not otherwise included, any guarantee obligation by such Person of the obligations of the
type referred to in clause (a) of another Person (whether or not such items would appear upon the balance sheet of such obligor or
guarantor), other than by endorsement of negotiable instruments for collection in the ordinary course of business and (ii) to the
extent not otherwise included, the obligations of the type referred to in clause (a) of another Person secured by a Lien (other than a
Permitted Lien) on any property owned by such Person, whether or not such obligations are assumed by such Person and whether
or not such obligations would appear upon the balance sheet of such Person; provided that the amount of such Indebtedness for
purposes of this clause (ii) will be the lesser of the fair market value of such property at such date of determination and the amount
of Indebtedness so secured;
(c)
net obligations of such Person under any Hedge Agreement to the extent such obligations would appear as a
net liability on a balance sheet of such Person (other than in the footnotes) prepared in accordance with GAAP; and
(d)
all obligations of such Person in respect of Disqualified Equity Interests;
provided that, notwithstanding the foregoing, Indebtedness will be deemed not to include (1) contingent obligations incurred in the ordinary
course of business unless and until such obligations are non-contingent, (2) trade payables, (3) earn-outs, purchase price holdbacks or similar
obligations, (4) intercompany liabilities in the ordinary course of business, (5) Permitted Liens, (6 ) Indebtedness of any direct or indirect
parent company appearing on the balance sheet of such Person solely by reason of push down accounting under GAAP and (7) lease
obligations other than in respect of a Capitalized Lease. The amount of any net obligation under any Hedge Agreement on any date shall be
deemed to be the Swap Termination Value thereof as of such date.
“Indemnified Liabilities” has the meaning specified in Section 11.05(e).
“Indemnitees” has the meaning specified in Section 11.05.
“Independent Financial Advisor” means an accounting, appraisal, investment banking firm or consultant of nationally
recognized standing that is, in the good faith judgment of the Borrower, qualified to perform the task for which it has been engaged and that
is independent of the Borrower and its Affiliates.
“Information” has the meaning specified in Section 11.08.
“Initial Borrower” has the meaning specified in the introductory paragraph to this Agreement.
“Initial Revolving Borrowing” means one or more borrowings of Revolving Loans on the Closing Date, not to exceed the sum of
(a) $75,000,000 plus (b) amounts necessary to backstop or cash collateralize, or to replace, existing letters of credit issued for the account of
the Borrower or its Subsidiaries outstanding on the Closing Date, plus (c) up to $75,000,000 of additional Letters of Credit, plus (d) amounts
necessary to finance working capital needs on the Closing Date, plus (e) amounts necessary to fund certain original issue discount or fees,
provided that, without limitation, Letters of Credit may be issued on the Closing
47
Date to backstop or replace letters of credit, guarantees and performance or similar bonds outstanding on the Closing Date.
“Initial Term Loans” has the meaning assigned to such term in the Term Loan Credit Agreement.
“Intellectual Property” has the meaning specified in the Security Agreement or the Canadian Security Agreement, as applicable.
“Intellectual Property Security Agreements” has the meaning specified in the Security Agreement or the Canadian Security
Agreement, as applicable.
“Intercreditor Agreements” means the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement
governing lien priority, in each case reasonably acceptable to the Collateral Agent and the Borrower that may be executed from time to time
pursuant to the terms hereof.
“Interest Payment Date” means, (a) as to any Eurocurrency Rate Loan, the last day of each Interest Period applicable to such
Eurocurrency Rate Loan and the applicable Maturity Date; provided that if any Interest Period for a Eurocurrency Rate Loan exceeds three
months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates, and
(b) as to any Base Rate Loan (including a Swing Line Loan), the first Business Day of each fiscal quarter and the applicable Maturity Date.
“Interest Period” means, as to each Eurocurrency Rate Loan, the period commencing on the date such Eurocurrency Rate Loan is
disbursed or converted to or continued as a Eurocurrency Rate Loan and ending on the date one, two (with respect to ICE LIBOR, only to the
extent such Interest Period would end on or prior to December 31, 2021), three or six months (other than for CDOR Rate Loans) thereafter,
as selected by the Borrower or any Co-Borrower in its Committed Loan Notice; provided that:
(a)
any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next
succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end
on the immediately preceding Business Day;
(b)
any Interest Period (other than an Interest Period having a duration of less than one month) that begins on the
last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and
(c)
no Interest Period shall extend beyond the applicable Maturity Date.
“Inventory” means all “inventory,” as such term is defined in the UCC as in effect on the date hereof in the State of New York, or,
if applicable, the PPSA, wherever located, in which any Person now or hereafter has rights.
“Inventory Component” means the lesser of (a) 75.0% of the cost of the Eligible Inventory and (b) 85.0% of (i) the NOLV
Percentage of Eligible Inventory multiplied by (ii) the Value of such Eligible Inventory.
“Investment” means, as to any Person, any direct or indirect acquisition or investment by such Person, by means of
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(a)
the purchase or other acquisition (including by merger, amalgamation or otherwise) 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, another Person, including any partnership or joint venture
interest in such other Person, but excluding any Short Term Advances; or
(c)
the purchase or other acquisition (in one transaction or a series of transactions, including by merger,
amalgamation or otherwise) 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 another Person;
provided that none of the following shall constitute an Investment (i) intercompany advances between and among the Borrower and its
Restricted Subsidiaries relating to their cash management, tax and accounting operations in the ordinary course of business and (ii)
intercompany loans, advances or Indebtedness between and among the Borrower and its Restricted Subsidiaries having a term not exceeding
364 days and made in the ordinary course of business.
“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the
equivalent) by S&P, or an equivalent rating by any other nationally recognized statistical rating agency selected by the Borrower.
“IRS” means Internal Revenue Service of the United States.
“Issuance Notice” means an Issuance Notice in respect of letters of credit substantially in the form of Exhibit A-2.
“Issuing Bank” means as the context may require, (a) Barclays, (b) Bank of Montreal, (c) Credit Suisse AG, Cayman Islands
Branch, (d) Wells Fargo Bank, National Association and any other Lender that, at the request of the Borrower and with the consent of the
Administrative Agent (not to be unreasonably withheld), agrees to become an Issuing Bank in accordance with Section 2.04(k) or (m) and (i)
solely with respect to any Existing Letter of Credit (and any amendment, renewal or extension thereof in accordance with this Agreement),
the Lender or Affiliate or branch of a Lender that issued such Existing Letter of Credit. Each Issuing Bank may, in its discretion, arrange for
one or more Letters of Credit to be issued by Affiliates or branches of such Issuing Bank (or other financial institution), in which case the
term “Issuing Bank” shall include any such Affiliate or branch (or other financial institution) with respect to Letters of Credit issued by such
Affiliate or branch (or other financial institution).
“Jackson Wijaya” means (a) Jackson Wijaya, (b) family members of Jackson Wijaya, (c) trusts, partnerships or limited liability
companies for the benefit of any of the individuals identified in the foregoing clause (a) or (b), and (d) heirs, executors, estates, successors
and legal representatives of the individuals identified in the foregoing clause (a) or (b).
“Joint Bookrunners” means Barclays, BMO, CS and WF.
“Joint Venture” means (a) any Person which would constitute an “equity method investee” of the Borrower or any of the
Restricted Subsidiaries and (b) any Person in whom the Borrower or any of the Restricted Subsidiaries beneficially owns any Equity Interest
that is not a Restricted Subsidiary.
49
“Joint Venture Investments” means Investments in any Joint Venture or Unrestricted Subsidiary in an aggregate amount not to
exceed the greater of (a) 10.00% of Closing Date EBITDA and (b) 10.00% of TTM Consolidated Adjusted EBITDA as of the applicable date
of determination provided that, in the case of any Investment in an Unrestricted Subsidiary, no Specified Event of Default has occurred or is
continuing or would result therefrom.
“Judgment Currency” has the meaning specified in Section 2.21(b).
“Junior Debt Repayment” has the meaning specified in Section 7.09(a).
“Junior Financing” means any Material Indebtedness (i) that is contractually subordinated in right of payment to the Obligations
expressly by its terms (ii) constitutes Junior Lien Debt or (ii) any Incremental Loans (as defined in the Term Loan Credit Agreement), any
Incremental Equivalent Debt or any Permitted Ratio Debt, in each case consisting of unsecured Indebtedness of a Loan Party.
“Junior Financing Documentation” means any documentation governing any Junior Financing.
“Junior Lien Debt” means any Indebtedness that is intended by the Borrower to be secured by a Lien on all or any portion of the
Collateral that has a priority that is contractually (or otherwise) junior in priority to the Lien on such Collateral that secure the Term Loan
Obligations (other than the Obligations and any Indebtedness secured on a pari passu basis with the Obligations on the ABL Priority
Collateral).
“Landlord Lien Reserve” means, the amount equal to (x) up to three month’s rent for all of the Loan Parties’ leased locations or
the amount that may be payable for up to three months to any third party warehouse or other storage facilities where Eligible Inventory is
located, in each case, other than any such location with respect to which the Administrative Agent shall have received a Collateral Access
Agreement in form reasonably satisfactory to the Administrative Agent (it being understood that upon receipt of any such Collateral Access
Agreement with respect to any location, any Landlord Lien Reserve shall be released) plus (y) past due rent for all of the Loan Parties’ leased
locations where such Eligible Inventory is located; provided, that no Landlord Lien Reserves shall be imposed prior to the date that is ninety
(90) days after the Closing Date (or such later day as may be agreed by the Administrative Agent in its sole discretion).
“Latest Maturity Date” means, at any date of determination, the latest maturity or expiration date applicable to any Loan or
Commitment hereunder at such time, including the latest maturity or expiration date of any Extended Revolving Commitment, in each case
as extended in accordance with this Agreement from time to time.
“Laws” means, collectively, all international, foreign, federal, state, provincial, territorial, municipal and local statutes, treaties,
rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities and executive orders, including the
interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration
thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any
Governmental Authority.
“LCA Election” has the meaning specified in Section 1.08(f).
“LCA Test Date” has the meaning specified in Section 1.08(f).
“Lead Arrangers” has the meaning specified in the introductory paragraph to this Agreement.
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“Lender” has the meaning specified in the introductory paragraph to this Agreement (and, for the avoidance of doubt, includes
each Tranche 1 Revolving Lender and each Tranche 2 Revolving Lender), and their respective successors and assigns as permitted hereunder,
each of which is referred to herein as a “Lender.” Each Additional Lender shall be a Lender to the extent any such Person has executed and
delivered an Incremental Amendment, as the case may be, and to the extent such Incremental Amendment shall have become effective in
accordance with the terms hereof and thereof, and each Extending Lender shall continue to be a Lender. As of the Closing Date,
Schedule 2.01 sets forth the name of each Lender. Unless the context otherwise requires, the term “Lenders” includes the Issuing Banks and
the Swing Line Lender. Notwithstanding the foregoing, no Disqualified Lender that purports to become a Lender hereunder (notwithstanding
the provisions of this Agreement that prohibit Disqualified Lenders from becoming Lenders) shall be entitled to any of the rights or
privileges enjoyed by the other Lenders (including with respect to voting, information and lender meetings) and shall be deemed for all
purposes to be, at most, a Defaulting Lender (except for purposes of Section 2.19(d)) until such time as such Disqualified Lender no longer
owns any Loans or Commitments.
“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative
Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent.
“Letter of Credit” means a letter of credit issued or to be issued by any Issuing Bank pursuant to this Agreement, including
Existing Letters of Credit, which letter of credit shall be (a) a standby letter of credit or (b) solely to the extent agreed by the applicable
Issuing Bank in its sole discretion, a commercial or “trade” letter of credit.
“Letter of Credit Advance” means, as to any Tranche 1 Revolving Lender, such Lender’s funding of its participation in any
Letter of Credit Borrowing in accordance with its Pro Rata Share.
“Letter of Credit Application” means an application and agreement for the issuance or amendment of a Letter of Credit in the
form from time to time in use by the applicable Issuing Bank, together with an Issuance Notice.
“Letter of Credit Borrowing” means an extension of credit resulting from a drawing under any Letter of Credit that has not been
reimbursed by the Borrower or the applicable Co-Borrower on the date when made or refinanced as a Tranche 1 Revolving Loan Borrowing.
“Letter of Credit Documents” means, as to any Letter of Credit, each Letter of Credit Application and any other document,
agreement and instrument entered into by the applicable Issuing Bank and the Borrower or the applicable Co-Borrower or in favor of such
Issuing Bank and relating to such Letter of Credit.
“Letter of Credit Expiration Date” means the day that is five Business Days prior to the Revolving Commitment Termination
Date or such other day as the Administrative Agent, the applicable Issuing Bank and the Borrower or Co-Borrower may agree (or, if such day
is not a Business Day, the immediately preceding Business Day).
“Letter of Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or the extension of the expiry date
thereof, or the renewal or increase of the amount thereof.
“Letter of Credit Obligations” means, at any time, the aggregate of all liabilities at such time of any Loan Party to each Issuing
Bank with respect to Letters of Credit, whether or not any such liability is contingent, including, without duplication, the sum of (a) the
Reimbursement Obligations at such time and
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(b) the maximum aggregate amount which is, or at any time thereafter may become, available for drawing under all Letters of Credit then
outstanding.
“Letter of Credit Percentage” means, (a) initially with respect to (i) Barclays, 31.429%, (b) Bank of Montreal, 35.714%, (c)
Credit Suisse AG, Cayman Islands Branch, 11.429%, and (d) Wells Fargo Bank, National Association, 21.429% (in each case, as may be
reduced to reflect any percentage allocated to another Issuing Bank pursuant to the immediately succeeding clause (b)) and (b) from time to
time after the Closing Date with respect to any other Issuing Bank, subject to Section 11.01, a percentage to be agreed between the Borrower
and such Issuing Bank.
“Letter of Credit Sublimit” means the greater of (a) $175,000,000 and (b) such higher amount as the Borrower, the Required
Lenders and the applicable Issuing Bank(s) may from time to time agree.
“Letter of Credit Usage” means, as of any date of determination, the sum of (a) the maximum aggregate amount which is, or at
any time thereafter may become, available for drawing under all Letters of Credit then outstanding and (b) the aggregate amount of all
Reimbursement Obligations outstanding at such time.
“Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory, deemed or
other), charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any
conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any
Capitalized Lease having substantially the same economic effect as any of the foregoing); provided that in no event shall an operating lease in
and of itself be deemed a Lien.
“Lien Release Event” has the meaning specified in Section 10.11(a)(i).
“Limited Condition Acquisition” means any Acquisition Transaction or other Investment by the Borrower or one or more of its
Restricted Subsidiaries whose consummation is not conditioned on the availability of, or on obtaining, third party financing.
“Line Cap” shall mean the lesser of (a) the aggregate amount of the Commitments at such time and (b) the Borrowing Base then
in effect.
“Liquidity Condition” has the meaning set forth in the definition of “Cash Dominion Period”.
“Loan” means any of a Revolving Loan, a Swing Line Loan and a Protective Advance made by a Lender to the Borrower or any
Co-Borrower under Article II (including Section 2.16).
“Loan Documents” means, collectively, (a) this Agreement, (b) the Notes, (c) any Incremental Amendment or Extension
Amendment, (d) the Guaranty, (e) the Collateral Documents, (f) the Intercreditor Agreements and (g) the Global Intercompany Note.
“Loan Parties” means, collectively, the Borrower, any Co-Borrowers and the Guarantors; provided that prior to the
consummation of the Acquisition, neither the Acquired Business nor any of its Subsidiaries shall be Loan Parties.
“L/C Fee” has the meaning specified in Section 2.11(b)(ii).
“Management Stockholders” means (a) any Company Person who is an investor in Holdings or a Parent Entity, (b) family
members of any of the individuals identified in the foregoing clause (a), (c)
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trusts, partnerships or limited liability companies for the benefit of any of the individuals identified in the foregoing clause (a) or (b), and (d)
heirs, executors, estates, successors and legal representatives of the individuals identified in the foregoing clause (a) or (b).
“Margin Stock” has the meaning set forth in Regulation U of the Board of Governors of the United States Federal Reserve
System, or any successor thereto.
“Master Agreement” has the meaning specified in the definition of “Hedge Agreement.”
“Material Adverse Effect” means any event, circumstance or condition that has had a materially adverse effect on (a) the
business, operations, assets, liabilities (actual or contingent) or financial condition of the Borrower and its Restricted Subsidiaries, taken as a
whole, and (b) the ability of the Loan Parties (taken as a whole) to perform their respective payment obligations under the Loan Documents.
“Material Domestic Subsidiary” means, as of the Closing Date and thereafter at any date of determination, each of the
Borrower’s Domestic Subsidiaries that are Restricted Subsidiaries, (a) whose total assets (other than intercompany investments) at the last
day of the most recent Test Period (when taken together with the total assets (other than intercompany investments) of the Restricted
Subsidiaries of such Domestic Subsidiary at the last day of the most recent Test Period) were equal to or greater than 5.0% of the
consolidated total assets of the Borrower and the Restricted Subsidiaries as of the last day of such Test Period, in each case determined in
accordance with GAAP or (b) whose revenues for such Test Period (when taken together with the revenues of the Restricted Subsidiaries of
such Domestic Subsidiary for such Test Period) were equal to or greater than 5.0% of the consolidated revenues of the Borrower and the
Restricted Subsidiaries for such Test Period, in each case determined in accordance with GAAP; provided that if, at any time and from time
to time after the date which is 30 days after the Closing Date (or such longer period as the Administrative Agent may agree in its sole
discretion), Domestic Subsidiaries that are not Guarantors solely because they do not meet the thresholds set forth in clause (a) or (b)
comprise in the aggregate more than (when taken together with the total assets (other than intercompany investments) of the Restricted
Subsidiaries of such Domestic Subsidiaries at the last day of the most recent Test Period) 10.0% of the total consolidated assets of the
Borrower and the Restricted Subsidiaries that are Domestic Subsidiaries as of the end of the most recently ended Test Period or more than
(when taken together with the revenues of the Restricted Subsidiaries of such Domestic Subsidiaries for such Test Period) 10.0% of the
consolidated revenues of the Borrower and the Restricted Subsidiaries that are Domestic Subsidiaries for such Test Period (or, in each case,
on any date when re-designated as an Excluded Subsidiary pursuant to the definition of “Excluded Subsidiary”), then the Borrower shall,
not later than sixty days after the date by which financial statements for such Test Period were required to be delivered pursuant to this
Agreement or on the date of such redesignation, as applicable (or, in each case, such longer period as the Administrative Agent may agree in
its reasonable discretion), (i) designate in writing to the Administrative Agent one or more of such Domestic Subsidiaries as “Material
Domestic Subsidiaries” to the extent required such that the foregoing condition ceases to be true and (ii) comply with the provisions of
Section 6.11 with respect to any such Subsidiaries.
“Material Foreign Subsidiary” means, as of the Closing Date and thereafter at any date of determination, each of the Borrower’s
Foreign Subsidiaries that are Restricted Subsidiaries (a) whose total assets (other than intercompany investments) at the last day of the most
recent Test Period (when taken together with the total assets (other than intercompany investments) of the Restricted Subsidiaries of such
Foreign Subsidiary at the last day of the most recent Test Period) were equal to or greater than 5.0% of the consolidated total assets of the
Borrower and the Restricted Subsidiaries as of the last day of such Test Period, in each case determined in accordance with GAAP or
(b) whose revenues for such Test Period (when taken together with the revenues of the Restricted Subsidiaries of such Foreign Subsidiary for
such Test Period) were equal to or greater than 5.0% of the consolidated revenues of the Borrower and the
53
Restricted Subsidiaries for such Test Period, in each case determined in accordance with GAAP; provided that if, at any time and from time
to time after the date which is 30 days after the Closing Date (or such longer period as the Administrative Agent may agree in its sole
discretion), Foreign Subsidiaries that are not Material Foreign Subsidiaries comprise in the aggregate more than (when taken together with
the total assets (other than intercompany investments) of the Restricted Subsidiaries of such Foreign Subsidiaries at the last day of the most
recent Test Period) 10.0% of the total consolidated assets of the Borrower and the Restricted Subsidiaries that are Foreign Subsidiaries as of
the end of the most recently ended Test Period or more than (when taken together with the revenues of the Restricted Subsidiaries of such
Foreign Subsidiaries for such Test Period) 10.0% of the consolidated revenues of the Borrower and the Restricted Subsidiaries that are
Foreign Subsidiaries for such Test Period (or, in each case, on any date when re-designated as an Excluded Subsidiary pursuant to the
definition of “Excluded Subsidiary”), then the Borrower shall, not later than sixty days after the date by which financial statements for such
Test Period were required to be delivered pursuant to this Agreement or on the date of such re-designation (or, in each case, such longer
period as the Administrative Agent may agree in its reasonable discretion), designate in writing to the Administrative Agent one or more of
such Foreign Subsidiaries as “Material Foreign Subsidiaries” to the extent required such that the foregoing condition ceases to be true.
“Material Indebtedness” means, as of any date, (i) the Indebtedness with respect to the Term Loan Facility, (ii) the Indebtedness
with respect to the Senior Secured Notes and (iii) the Indebtedness for borrowed money on such date of any Loan Party in an aggregate
principal amount exceeding the Threshold Amount; provided that in no event shall any of the following be Material Indebtedness (a)
Indebtedness under a Loan Document, (b) obligations in respect of a Qualified Securitization Financing, (c) Capitalized Lease Obligations,
(d) Indebtedness held by a Loan Party or any Indebtedness held by an Affiliate of a Loan Party and (e) Indebtedness under Hedge
Agreements.
“Material Subsidiary” means any Material Domestic Subsidiary or any Material Foreign Subsidiary.
“Materiality Threshold Amount” means an amount equal to the greater of 5.00% of Closing Date EBITDA and 5.00% of TTM
Consolidated Adjusted EBITDA.
“Maturing Indebtedness Reserve” means, as of any date of determination, with respect to any installment(s) of principal of
Indebtedness described in the definition of “Inside Maturity Exception” (as defined in the Term Loan Credit Agreement as in effect on the
date hereof) which has a scheduled date of payment or scheduled maturity date that is due to occur less than 91 days after such date, a reserve
equal to the outstanding principal amount of such installment(s) that are so due. For the avoidance of doubt, a Maturing Indebtedness
Reserve shall not be established with respect to any principal installment of Indebtedness prior to the 91st day preceding the scheduled date
of payment or a scheduled maturity date of such installment.
“Maturity Date” means:
(a)
with respect to the Revolving Loans, the date that is the earlier of (i) five years after the Closing Date and
(ii) the date such Revolving Loans are declared due and payable pursuant to Section 9.02, and
(b)
with respect to any tranche of Extended Revolving Commitments, the earlier of (i) the final maturity date as
specified in the applicable Extension Amendment and (ii) the date such tranche of Extended Revolving Commitments are
terminated and/or declared due and payable pursuant to Section 9.02.
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provided, in each case, that if such day is not a Business Day, the applicable Maturity Date shall be the Business Day immediately preceding
such day.
“Maximum Rate” has the meaning specified in Section 11.10.
“Merger” has the meaning specified in the preliminary statements to this Agreement.
“Merger Sub” has the meaning specified in the introductory paragraph to this Agreement.
“Minimum Collateral Amount” means, at any time, (a) with respect to Cash Collateral consisting of cash or deposit account
balances, an amount equal to 103% of the Fronting Exposure of the Issuing Banks with respect to Letters of Credit issued and outstanding at
such time, (b) with respect to Cash Collateral consisting of cash or deposit account balances, an amount equal to 103% of the Fronting
Exposure of the Swing Line Lender with respect to Swing Line Loans outstanding at such time and (c) otherwise, an amount determined by
the Administrative Agent and the Issuing Banks or the Swing Line Lender, as the case may be, in their sole discretion.
“Minimum Equity Contribution” has the meaning specified in the definition of “Equity Contribution.”
“Model” means the financial model used in connection with the syndication of the Facility and the Term Loan Facility.
“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.
“Multiemployer Plan” means any multiemployer plan as defined in Section 4001(a)(3) of ERISA and subject to Title IV of
ERISA, to which any Loan Party or any of their respective ERISA Affiliates makes or is obligated to make contributions, or during the
preceding five plan years, has made or been obligated to make contributions, which for greater certainty shall not include a Canadian Pension
Plan or a Canadian Multi-Employer Pension Plan.
“Net Income” means, with respect to any Person, the net income (loss) of such Person, determined in accordance with GAAP
(determined, for the avoidance of doubt, on an unconsolidated basis) and before any reduction in respect of preferred stock dividends.
“NOLV Percentage” means, with respect to Inventory of any Person, the net orderly liquidation value of Inventory, expressed as
a percentage of Value, net of all reasonable costs and expenses of liquidation thereof, as determined based upon the most recent Inventory
appraisal conducted in accordance with Section 6.10(b) hereof.
“Non-Bank Certificate” has the meaning specified in Section 3.01(b).
“Non-Consenting Lender” has the meaning specified in Section 3.07.
“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.
“Non-Financed Capital Expenditures” means Consolidated Capital Expenditures that (a) are not financed with the proceeds of
any Indebtedness (it being understood and agreed that, to the extent financed with Loans, such Consolidated Capital Expenditures shall be
deemed Non-Financed Capital Expenditures), the proceeds of any sale or issuance of Equity Interests of, or equity contributions to, Holdings
or the
55
Borrower, the proceeds of any Disposition (including any substantially contemporaneous trade-in of assets) or any Casualty Event and (b) are
not reimbursed by a third person (excluding any Loan Party or any of its Restricted Subsidiaries).
“Non-Loan Party” means any Restricted Subsidiary of the Borrower that is not a Loan Party.
“Nonrenewal Notice Date” has the meaning specified in Section 2.04(b)(iii).
“Not Otherwise Applied” means, with reference to the amount of any Permitted Equity Issuances that is proposed to be applied
to a particular use or transaction, that such amount was not previously applied in determining the permissibility of a transaction under the
Loan Documents (including, for the avoidance of doubt, any use of such amount to fund a Specified Equity Contribution or to incur
Contribution Indebtedness) where such permissibility was (or may have been) contingent on the receipt or availability of such amount, it
being agreed that the incurrence of secured debt shall be deemed one use transaction for purposes of this definition.
“Note” means each of the Tranche 1 Revolving Loan Notes, the Tranche 2 Revolving Loan Notes and the Swing Line Note.
“Obligations” means all (a) advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under
any Loan Document or otherwise with respect to any Loan or Letter of Credit (including in respect of any Tranche 1 Revolving Exposure
relating thereto), whether direct or indirect (including those acquired by assumption), absolute or contingent, due or to become due, now
existing or hereafter arising and including interest, fees and expenses that accrue after the commencement by or against any Loan Party of
any case or proceeding under any Debtor Relief Laws naming such Person as the debtor in such proceeding, regardless of whether such
interest, fees and expenses are allowed or allowable claims in such case or proceeding, (b) obligations of any Loan Party arising under any
Secured Hedge Agreement and (c) Cash Management Obligations; provided that “Obligations” of any Guarantor shall exclude any Excluded
Swap Obligations. Without limiting the generality of the foregoing, the Obligations of the Loan Parties under the Loan Documents (and any
of their Subsidiaries to the extent they have obligations under the Loan Documents) include the obligation (including guarantee obligations)
to pay principal, interest, reimbursement obligations, charges, expenses, fees, Attorney Costs, indemnities and other amounts payable by any
Loan Party and to provide Cash Collateral under any Loan Document.
“OFAC” means the Office of Foreign Assets Control of the U.S. Treasury Department.
“OID” means original issue discount.
“Organization Documents” means,
(a)
with respect to any corporation, the certificate and/or articles of incorporation and the bylaws (or equivalent
or comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b)
operating agreement; and
with respect to any limited liability company, the certificate or articles of formation or organization and
(c)
with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint
venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation
56
or organization with the applicable Governmental Authority in the jurisdiction of its formation or organization and, if applicable,
any certificate or articles of formation or organization of such entity.
“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection
between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed,
delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under,
engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan
Document).
“Other Taxes” has the meaning specified in Section 3.01(f).
“Overadvance” shall mean a Loan or issuance of a Letter of Credit to the extent that, immediately after the making of such Loan
or issuance, the aggregate amount of Credit Extensions then outstanding would exceed the Line Cap.
“Overnight Rate” means, for any day, (a) with respect to any amount denominated in Dollars, the greater of (i) the Federal Funds
Rate and (ii) an overnight rate reasonably determined by the Administrative Agent in accordance with bank industry rules on interbank
compensation and (b) with respect to any amount denominated in any Alternative Currency, the rate of interest per annum reasonably
determined by the Administrative Agent to be its cost of funding such amount.
“Parent Entity” has the meaning specified in Section 6.01.
“Pari Passu Lien Debt” means any Indebtedness that is intended by the Borrower to be secured by Liens on all or any portion of
the Collateral that are pari passu in priority with the Liens on Collateral that secure the Term Loan Obligations. For the avoidance of doubt,
“Pari Passu Lien Debt” includes the Initial Term Loans and the Senior Secured Notes as of the Closing Date, but excludes the Obligations
and any Indebtedness secured on a pari passu basis with the Obligations on the ABL Priority Collateral.
“Participant” has the meaning specified in Section 11.07(d).
“Participant Register” has the meaning specified in Section 11.07(e).
“Participating Member State” means each state as described in any EMU Legislation.
“Participation” has the meaning specified in Section 11.07(d).
“Payment” has the meaning specified in Section 11.28.
“Payment Conditions” means with respect to any transaction (i) no Event of Default has occurred and is continuing or would
arise after giving effect to such transaction and (ii) either (a) the Fixed Charge Coverage Ratio would be at least 1.00:1.00 on a Pro Forma
Basis and the Borrower would have Specified Excess Availability of at least the greater of (x) $40,000,000 and (y) 12.5% of the Line Cap
(but with respect to Restricted Payments only, $50,000,000 and 15.0%, respectively) on a Pro Forma Basis immediately after giving effect to
such transaction and over the 20 consecutive calendar days immediately prior to such transaction, or (b) the Borrower would have Specified
Excess Availability on a Pro Forma Basis of at least the greater of (x) $60,000,000 and (y) 17.5% of the Line Cap (but with respect to
Restricted Payments only, $70,000,000 and 20.0%) on a Pro Forma Basis immediately after giving effect to such transaction and over the 20
consecutive calendar days immediately prior to such transaction.
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“Payment Notice” has the meaning specified in Section 11.28.
“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.
“Pension Plan” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a
Multiemployer Plan, that is subject to Title IV of ERISA, and is sponsored or maintained by any Loan Party or any of their respective ERISA
Affiliates or to which any Loan Party or any of their respective ERISA Affiliates contributes or has an obligation to contribute, or in the case
of a multiple employer or other plan described in Section 4064(a) of ERISA, has made or has had an obligation to make contributions at any
time in the preceding five plan years, but shall not include a Canadian Pension Plan or a Canadian Multi-Employer Pension Plan.
“Permitted Acquisition” means an Acquisition Transaction together with other Investments undertaken to consummate such
Acquisition Transaction; provided that:
(a)
after giving Pro Forma Effect to any such Acquisition Transaction or Investment, at the applicable time
determined in accordance with Section 1.08(f), no Event of Default shall have occurred and be continuing;
(b)
Documents;
the business of such Person, or such assets, as the case may be, constitute a business permitted by the Loan
(c)
such newly created or acquired Subsidiary shall be a Restricted Subsidiary at the time of such Permitted
Acquisition; and
(d)
with respect to each such purchase or other acquisition, all actions required to be taken with respect to any
such newly created or acquired Restricted Subsidiary or assets in order to satisfy the requirements set forth in Section 6.11 within
the time periods set forth therein to the extent applicable shall have been taken (or shall be taken), to the extent required by such
section (or arrangements for the taking of such actions after the consummation of the Permitted Acquisition shall have been
made);
provided further that Permitted Acquisitions of any Person that on the date of such Permitted Acquisition is not a Loan Party (and
will not become a Loan Party as a result of such Permitted Acquisitions within the time periods set forth in Section 6.11) shall not exceed the
greater of (1) 50.00% of Closing Date EBITDA and (2) 50% of TTM Consolidated Adjusted EBITDA (together with any Investments under
the proviso of Section 7.02(a)).
“Permitted Discretion” means reasonable credit judgment made in good faith in accordance with customary business practices
for comparable asset-based lending transactions; provided that, as it relates to the establishment of new categories of Reserves after the
Closing Date or changes to eligibility criteria (other than Reserves that are expressly included in the definition of “Reserves” or the
adjustment or imposition of exclusionary criteria in the definitions of “Eligible Accounts Receivable,” “Eligible Credit Insured Accounts”
and “Eligible Inventory”), Permitted Discretion will require that (a) such establishment, adjustment or imposition of Reserves after the
Closing Date be based on the analysis of facts or events first occurring or first discovered by the Administrative Agent after the Closing Date
or that are materially different from facts or events known to the Administrative Agent on the Closing Date, (b) the amount of any such
Reserve so established or the effect of any adjustment or imposition of exclusionary criteria in the definitions of “Eligible Accounts
Receivable,” “Eligible Credit Insured Accounts” and “Eligible Inventory” be a reasonable quantification of changes in the ability of the
Administrative Agent to realize upon the ABL Priority Collateral included in the Borrowing Base and (c) no Reserves or changes to
eligibility criteria will
58
be duplicative of Reserves or changes already accounted for through eligibility criteria in the definitions of “Eligible Accounts Receivable,”
Eligible Credit Insured Accounts” and/or “Eligible Inventory” or through the advance rates set forth in the definitions of “Accounts
Receivable Component” and/or “Inventory Component”.
“Permitted Equity Issuance” means any,
(a)
public or private sale or issuance of any Qualified Equity Interests of the Borrower or any Parent Entity
(other than a Specified Equity Contribution);
(b)
contribution to the equity capital of the Borrower or any other Loan Party (other than (i) a Specified Equity
Contribution or (ii) in exchange for Disqualified Equity Interests); or
(c)
sale or issuance of Indebtedness of Holdings, the Borrower or a Restricted Subsidiary (other than
intercompany Indebtedness) that have been converted into or exchanged for Qualified Equity Interests of Holdings, the Borrower,
a Restricted Subsidiary or any Parent Entity;
provided that the amount of any Permitted Equity Issuance will be the amount of cash and Cash Equivalents received by a Loan Party or
Restricted Subsidiary in connection with such sale, issuances or contribution, and the fair market value of any other property received in
connection with such sale, issuance or contribution, (measured at the time made), without adjustment for subsequent changes in the value.
“Permitted Holders” means any:
(a)
(b)
(c)
Jackson Wijaya and Affiliates (but excluding any portfolio companies of any of the foregoing);
the Management Stockholders;
the Co-Investors;
(d)
any group (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) of which the Persons
described in clause (a), (b) or (c) above are members; provided that, without giving effect to the existence of such group or any
other group, the Persons described in clauses (a), (b) and (c) above, collectively, beneficially own (as defined in Rules 13(d) and
14(d) of the Exchange Act) Equity Interests representing at least a majority of the aggregate ordinary voting power represented by
the issued and outstanding Equity Interest of Holdings (or any Successor Holdings, if applicable) then held by such group; and
(e)
any Parent Entity, for so long as a majority of the aggregate ordinary voting power represented by the issued
and outstanding Equity Interests of such Parent Entity is beneficially owned (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, by one or more Permitted Holders described in clauses (a), (b), (c) and/or (d) of the
definition thereof.
“Permitted Investment” means (a) any Permitted Acquisition, (b) any Acquisition Transaction and/or (c) any other Investment or
acquisition permitted hereunder.
“Permitted Junior Secured Refinancing Debt” means any Credit Agreement Refinancing Indebtedness that is Junior Lien Debt.
“Permitted Lien” means any Lien not prohibited by Section 7.01.
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“Permitted Pari Passu Secured Refinancing Debt” means any Credit Agreement Refinancing Indebtedness that is Pari Passu
Lien Debt.
“Permitted Ratio Debt” means Indebtedness; provided that, at the time of incurrence thereof:
(a)
immediately after giving effect to the issuance, incurrence, or assumption of such Indebtedness:
(i)
in the case of any Pari Passu Lien Debt, the First Lien Net Leverage Ratio for the
applicable Test Period is equal to or less than the Closing Date First Lien Net Leverage Ratio less 0.50 to 1.00x;
(ii)
in the case of any Junior Lien Debt, the Secured Net Leverage Ratio for the applicable Test
Period is equal to or less than the Closing Date Secured Net Leverage Ratio less 0.25 to 1.00x; and
(iii)
in the case of any Indebtedness that is not secured by a Lien on any Collateral, the Total
Net Leverage Ratio for the applicable Test Period is equal to or less than the Closing Date Total Net Leverage Ratio;
in each case, after giving Pro Forma Effect to the incurrence of such Indebtedness and any use of proceeds thereof and measured
as of and for the Test Period immediately preceding the issuance, incurrence or assumption of such Indebtedness for which
internal financial statements are available; provided, that the aggregate principal amount of Permitted Ratio Debt incurred by Non-
Loan Parties, together with the aggregate principal amount of Incremental Equivalent Debt incurred by Non-Loan Parties, shall
not exceed, in the aggregate, the greater of (i) 50.00% of Closing Date EBITDA and (ii) 50.00% of TTM Consolidated Adjusted
EBITDA as of the applicable date of determination;
(b)
to the extent such Permitted Ratio Debt is required to be subject to the provisions of the Closing Date ABL
Intercreditor Agreement, a Debt Representative acting on behalf of the holders of such Indebtedness has become party to, or is
otherwise subject to the provisions of the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that
may be executed from time to time and reasonably acceptable to the Administrative Agent; and
(c)
Permitted Ratio Debt (i) that is Pari Passu Lien Debt shall not mature prior to the latest maturity date of, and
shall not have a Weighted Average Life to Maturity shorter than the remaining Weighted Average Life to Maturity of, the Initial
Term Loans (without giving effect to any amortization payments or prepayments on the Initial Term Loans actually made) or (ii)
that is Junior Lien Debt or unsecured Indebtedness shall not mature, or have scheduled amortization, prior to the latest maturity
date of the Initial Term Loans; provided that this clause (d) shall not apply to the incurrence of any such Indebtedness pursuant to
the Inside Maturity Exception (as defined in the Term Loan Credit Agreement as in effect on the date hereof).
Permitted Ratio Debt will be deemed to include any Registered Equivalent Notes issued in exchange therefor.
“Permitted Refinancing” means, with respect to any Person, any modification, refinancing, prepayment, refunding, replacement,
renewal or extension of any Indebtedness of such Person; provided that
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(a)
the principal amount (or accreted value, if applicable) thereof does not exceed the principal amount (or
accreted value, if applicable) of the Indebtedness so modified, refinanced, refunded, replaced, renewed or extended except by an
amount equal to unpaid accrued interest and premium (including tender premiums) thereon, plus OID and upfront fees plus other
fees and expenses reasonably incurred, in connection with such modification, refinancing, refunding, replacement, renewal or
extension and by an amount equal to any existing commitments unutilized thereunder,
(b)
other than with respect to a Permitted Refinancing in respect of Indebtedness permitted pursuant to Section
7.03(c) or Section 7.03(d)) such modification, refinancing, refunding, replacement, renewal or extension has a final maturity date
equal to or later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the remaining
Weighted Average Life to Maturity of, the Indebtedness being modified, refinanced, refunded, replaced, renewed or extended,
(c)
such Indebtedness shall not be incurred or guaranteed by any Loan Party or Restricted Subsidiary other than a
Loan Party or Restricted Subsidiary that was an obligor of the Indebtedness being exchanged, extended, renewed, replaced or
refinanced and no additional Loan Parties or Restricted Subsidiaries shall become liable for such Indebtedness;
(d)
if the Indebtedness being modified, refinanced, refunded, replaced, renewed, or extended is Junior Financing
or Junior Lien Debt,
(i)
to the extent the Indebtedness being modified, refinanced, refunded, replaced, renewed, or
extended is subordinated in right of payment to the Obligations, such modification, refinancing, refunding,
replacement, renewal, or extension is subordinated in right of payment to the Obligations on terms at least as favorable
to the Lenders as those contained in the documentation governing the Indebtedness being modified, refinanced,
refunded, replaced, renewed or extended,
(ii)
to the extent the Indebtedness being modified, refinanced, refunded, replaced, renewed, or
extended is unsecured, such modification, refinancing, refunding, replacement, renewal or extension is either (A)
unsecured or (B) secured only by Permitted Liens (provided that such incurrence will thereafter count in the calculation
of any remaining basket capacity thereunder, while such Indebtedness remains outstanding); and
(iii)
to the extent such Indebtedness being modified, refinanced, refunded, replaced, renewed,
or extended is secured by Liens, (A) such modification, refinancing, refunding, replacement, renewal or extension is
either (1) unsecured or (2) secured only by Permitted Liens, provided that if such Indebtedness is Pari Passu Lien Debt
or Junior Lien Debt, (x) to the extent such Indebtedness being modified, refinanced, refunded, replaced, renewed, or
extended is required to be subject to the provisions of the Closing Date ABL Intercreditor Agreement, a Debt
Representative acting on behalf of the holders of such Indebtedness has become party to, or is otherwise subject to the
provisions of the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that may be executed
from time to time and reasonably acceptable to the Administrative Agent and (y) (y) such Indebtedness shall not be
secured on a pari passu basis by the ABL Priority Collateral with Liens on the ABL Priority Collateral securing the
Obligations and (B) to the extent that such Liens are subordinated to the Liens securing the Obligations, such
modification, refinancing, refunding, replacement, renewal or extension is secured by Liens that are subordinated to the
Liens securing the Obligations on terms at least as
61
favorable to the Lenders as those contained in the documentation (including any intercreditor or similar agreements)
governing the Indebtedness being modified, refinanced, replaced, refunded, replaced, renewed or extended;
(e)
if such Indebtedness is secured by assets of the Borrower or any Restricted Subsidiary:
(i)
such Indebtedness shall not be secured by Liens on any assets of the Borrower or any Restricted
Subsidiary that are not also subject to, or would be required to be subject to pursuant to the Loan Documents, a Lien
securing the Obligations (except (1) Liens on property or assets applicable only to periods after the Latest Maturity
Date at the time of incurrence, (2) any Liens on property or assets to the extent that a Lien on such property or asset is
also added for the benefit of the Lenders, (3) Liens on the proceeds of such Indebtedness funded into escrow pursuant
to customary escrow arrangements, (4) any Liens on property or assets under the Indebtedness being exchanged,
extended, renewed, replaced or refinanced and (5) with respect to Indebtedness of Non-Loan Parties, Liens on assets of
any Non-Loan Party); and
(ii)
if such Indebtedness is Pari Passu Lien Debt or Junior Lien Debt, (x) a Debt Representative acting
on behalf of the holders of such Indebtedness has become party to, or is otherwise subject to the provisions of the
Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that may be executed from time to
time and reasonably acceptable to the Administrative Agent and (y) such Indebtedness shall not be secured on a pari
passu basis by the ABL Priority Collateral with Liens on the ABL Priority Collateral securing the Obligations.
Permitted Refinancing will be deemed to include any Registered Equivalent Notes issued in exchange therefor.
“Permitted Reorganization” means any transaction (a) undertaken to effect a corporate reorganization (or similar transaction or
event) for operational or efficiency purposes, (b) undertaken in connection with and reasonably required for consummating a Qualifying IPO,
or (c) related to tax planning or tax reorganization, in each case, as determined in good faith by the Borrower and entered into after the
Closing Date; provided that, (i) no Event of Default is continuing immediately prior to such transaction and immediately after giving effect
thereto and (ii) after giving effect to such transactions, the security interests of the Lenders in the Collateral (taken as a whole) and the
Guarantees of the Obligations (taken as a whole), in each case, would not be materially impaired as a result thereof, and such transaction will
not materially adversely affect the Borrower’s and the Co-Borrowers’ ability to make anticipated payments with respect to the Obligations as
and when they become due (in each case, as determined in good faith by the Borrower).
“Person” means any natural person, corporation, limited liability company, unlimited liability company, trust, joint venture,
association, company, partnership, Governmental Authority or other entity.
“Plan” means any material “employee benefit plan” (as such term is defined in Section 3(3) of ERISA), other than a Foreign Plan,
Canadian Pension Plan or a Canadian Multi-Employer Pension Plan, established or maintained by any Loan Party or, with respect to any such
plan that is subject to Section 412 of the Code or Title IV of ERISA, any of their respective ERISA Affiliates.
“Platform” has the meaning specified in Section 6.02.
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“Pledged Debt” has the meaning specified in the Security Agreement or the Canadian Security Agreement, as applicable.
“Pledged Equity” has the meaning specified in the Security Agreement or the Canadian Security Agreement, as applicable.
“Post-Acquisition Borrowing Base” has the meaning specified in the definition of “Eligible Accounts Receivable.”
“PPSA” means the Personal Property Security Act (Ontario) and the regulations thereunder, as from time to time in effect;
provided that, if validity, perfection or the effect of perfection or non-perfection, opposability or the priority of any Lien created hereunder on
the Collateral is governed by the personal property security legislation or other applicable legislation with respect to personal property
security in effect in a jurisdiction in Canada other than Ontario, “PPSA” means the Personal Property Security Act or such other applicable
legislation in effect from time to time in such other jurisdiction in Canada (including the Civil Code of Quebec) for purposes of the
provisions hereof relating to such validity, perfection, effect of perfection or non-perfection, opposability or priority of any Lien created
hereunder on the Collateral.
“Pre-Acquisition Borrowing Base” has the meaning specified in the definition of “Eligible Accounts Receivable.”
“Prepayment Notice” means a written notice made pursuant to Section 2.07(a)(i) substantially in the form of Exhibit J.
“Private-Side Information” means any information with respect to Holdings and its Subsidiaries that is not Public-Side
Information.
“Pro Forma Basis” and “Pro Forma Effect” mean, with respect to compliance with any test or covenant or calculation
hereunder, the determination or calculation of such test, covenant or ratio (including in connection with Specified Transactions) in
accordance with Section 1.08.
“Pro Rata Share” means with respect to all payments, computations and other matters relating to the Revolving Commitment or
Revolving Loans of any Lender of any Class and any Letters of Credit issued or participations purchased therein by any Lender of any Class
or any participation in any Swing Line Loans purchased by any Lender of any Class at any time a fraction (expressed as a percentage, carried
out to the ninth decimal place), the numerator of which is the amount of the Revolving Exposure of that Lender at such time and the
denominator of which is the aggregate Revolving Exposure of all Lenders of such Class at such time.
“Protective Advance” has the meaning specified in Section 2.02(a).
“PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be
amended from time to time.
“Public Company Costs” means costs relating to compliance with the Sarbanes-Oxley Act of 2002, as amended, and other
expenses arising out of or incidental to Holdings’ status (or any relevant Parent Entity’s status) as a reporting company, including costs, fees
and expenses (including legal, accounting and other professional fees) relating to compliance with provisions of the Securities Act and the
Exchange Act, the rules of securities exchange companies with listed equity securities, directors’ compensation, fees and expense
reimbursement, shareholder meetings and reports to shareholders, directors’ and officers’ insurance and other executive costs, legal and other
professional fees, and listing fees.
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“Public Lenders” means Lenders that do not wish to receive Private-Side Information.
“Public-Side Information” (a) at any time prior to Holdings or any of its Subsidiaries becoming the issuer of any Traded
Securities, information that is (i) of a type that would be required by applicable Law to be publicly disclosed in connection with an issuance
by Holdings or any of its Subsidiaries of its debt or equity securities pursuant to a registered public offering made at such time or (ii) not
material to make an investment decision with respect to securities of Holdings or any of its Subsidiaries (for purposes of United States
federal, state or other applicable securities laws), and (b) at any time on or after Holdings or any of its Subsidiaries becoming the issuer of
any Traded Securities, information that does not constitute material non-public information (within the meaning of United States federal,
state or other applicable securities laws) with respect to such Parent Entity or Holdings or any of their respective Subsidiaries or any of their
respective securities.
“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12
U.S.C. 5390(c)(8)(D).
“QFC Credit Support” has the meaning specified in Section 11.26(a).
“Qualified Cash” means cash and Cash Equivalents of the Loan Parties in DDAs (including any DDA maintained with the
Administrative Agent) that are subject to Blocked Account Agreements located in the United States or Canada; provided that the
Administrative Agent shall be entitled (unless otherwise agreed by the Administrative Agent in its Permitted Discretion), pursuant to the
terms thereof, to reasonably request cash reporting (i) with the delivery of a Borrowing Base Certificate, (ii) upon any request for a credit
extension and (iii) in connection with any action incurred in reliance on the Payment Conditions; provided that such reporting shall be daily
during a Cash Dominion Period.
“Qualified Cash Component” means 100% of Qualified Cash.
“Qualified Equity Interests” means any Equity Interests that are not Disqualified Equity Interests.
“Qualified Holding Company Debt” means unsecured Indebtedness of Holdings:
(a)
Restricted Subsidiary;
that is not subject to any Guarantee by any Loan Party (including the Borrower and any Co-Borrower) or any
(b)
that will not mature prior to the date that is six months after the Latest Maturity Date in effect on the date of
issuance or incurrence thereof;
(c)
that has no scheduled amortization or scheduled payments of principal and is not subject to mandatory
redemption, repurchase, prepayment or sinking fund obligation (it being understood that such Indebtedness may have mandatory
prepayment, repurchase or redemption provisions satisfying the requirements of clause (e) below);
(d)
that does not require any payments in cash of interest or other amounts (other than any AHYDO catch-up
payments) in respect of the principal thereof prior to the date that is 180 days after the Latest Maturity Date in effect on the date of
such issuance or incurrence; and
(e)
that has mandatory prepayment, repurchase or redemption, covenant, default and remedy provisions
customary for senior discount notes of an issuer that is the parent of a borrower under senior secured credit facilities, in each case
as determined by the Borrower in good faith;
64
provided that any such Indebtedness shall constitute Qualified Holding Company Debt only if immediately after giving effect to the issuance
or incurrence thereof and the use of proceeds thereof, no Event of Default shall have occurred and be continuing.
“Qualified Professional Asset Manager” has the meaning specified in Section 10.16(a).
“Qualified Securitization Financing” means any Securitization Financing of a Securitization Subsidiary that meets the following
conditions:
(a)
such Qualified Securitization Financing (including financing terms, covenants, termination events and other
provisions) is in the aggregate economically fair and reasonable to the Borrower and the Securitization Subsidiary, as determined
by the Borrower in good faith;
(b)
all sales, transfers and/or contributions of Securitization Assets and related assets to the Securitization
Subsidiary are made at fair market value;
(c)
the financing terms, covenants, termination events and other provisions thereof, including any Standard
Securitization Undertakings, shall be market terms, as determined by the Borrower in good faith; and
(d)
the aggregate principal amount of all Securitization Financings that may be Qualified Securitization
Financings shall not exceed $20,000,000.
“Qualifying IPO” means either (a) the issuance by Holdings or any Parent Entity of its common Equity Interests in a public
offering (other than a public offering pursuant to a registration statement on Form S-8 (or equivalent forms applicable for foreign public
companies or foreign private issuers) or any successor form) pursuant to an effective registration statement filed with the SEC in accordance
with the Securities Act or pursuant to a prospectus or similar documents filed with securities regulatory authorities outside of the United
States or (b) any transaction or series of transactions, including a SPAC IPO, that results in, or following which, any common Equity Interests
of the Borrower, any Parent Entity or any SPAC IPO Entity (or its successor by merger, amalgamation or other combination) being publicly
traded on any United States national securities exchange or over-the-counter market, or any analogous exchange or market in Canada, the
United Kingdom or the European Union.
“Recipient” means (a) each Agent, (b) any Lender and (c) any Issuing Bank, as applicable.
“Refunded Swing Line Loans” has the meaning specified in Section 2.03(c)(i).
“Refunding Equity Interests” has the meaning specified in Section 7.06 (o).
“Register” has the meaning specified in Section 11.07(c).
“Registered Equivalent Notes” means, with respect to any notes originally issued in a Rule 144A 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.
“Reimbursement Obligations” has the meaning specified in Section 2.04(c)(i).
“Related Indemnified Person” of an Indemnitee means (a) any controlling person or controlled affiliate of such Indemnitee, (b)
the respective directors, officers, or employees of such Indemnitee or any
65
of its controlling persons or controlled affiliates and (c) the respective agents of such Indemnitee or any of its controlling persons or
controlled affiliates, in the case of this clause (c), acting at the instructions of such Indemnitee, controlling person or such controlled affiliate;
provided that each reference to a controlled affiliate or controlling person in this definition shall pertain to a controlled affiliate or controlling
person involved in the negotiation or syndication of the Facility.
“Release Actions” has the meaning specified in Section 10.11(b).
“Release Certificate” has the meaning specified in Section 10.11(b).
“Release Date” has the meaning specified in Section 10.11(c).
“Release/Subordination Event” has the meaning specified in Section 10.11(a)(i)(G).
“Relevant Four Fiscal Quarter Period” means, with respect to any requested Specified Equity Contribution, the four-fiscal
quarter period ending on (and including) the fiscal quarter in which Consolidated Adjusted EBITDA will be increased as a result of such
Specified Equity Contribution.
“Relevant Governmental Body” means the Board of Governors of the Federal Reserve System or the Federal Reserve Bank of
New York, or a committee officially endorsed or convened by the Board of Governors of the Federal Reserve System or the Federal Reserve
Bank of New York, or any successor thereto.
“Relevant Rate” means (i) with respect to any Borrowing denominated in Dollars, the USD LIBOR and (ii) with respect to any
Borrowing denominated in Canadian Dollars, the CDOR Rate.
“Report” means reports prepared by the Administrative Agent or another Person showing the results of appraisals, field
examinations, inventory appraisals or audits pertaining to the Loan Parties’ assets from information furnished by or on behalf of the Loan
Parties, after the Administrative Agent has exercised its rights of inspection pursuant to Section 6.10(b), which Reports shall be distributed to
the Lenders by the Administrative Agent, subject to the provisions of Section 11.08.
“Reportable Event” means, with respect to any Pension Plan, any of the events set forth in Section 4043(c) of ERISA or the
regulations issued thereunder, other than events for which the thirty day notice period has been waived.
“Required Facility Lenders” means, with respect to any Facility on any date of determination, Lenders having or holding more
than 50% of the sum of (a) the aggregate principal amount of outstanding Loans under such Facility and (b) the aggregate unused
Commitments under such Facility; provided that the portion of outstanding Loans and the unused Commitments of such Facility, as
applicable, held or deemed held by a Defaulting Lender shall be excluded for purposes of making a determination of Required Facility
Lenders.
“Required Lenders” means, as of any date of determination, Lenders having or holding more than 50% of the sum of the
aggregate Revolving Exposure of all Lenders; provided that the aggregate Revolving Exposure of or held by any Defaulting Lender shall be
excluded for purposes of making a determination of Required Lenders.
“Required Minimum Balances” has the meaning specified in Section 6.19(c).
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“Reserved Secured Cash Management Obligations” means any Obligations in respect of any Secured Cash Management
Services, up to the maximum amount owing thereunder as specified by the applicable Cash Management Bank in writing to the
Administrative Agent, which amount may be increased with respect to any existing Secured Cash Management Services by further written
notice from such Cash Management Bank to the Administrative Agent from time to time; provided that in each case (a) such Obligations are
subject to a Bank Product Reserve so long as the establishment of such Bank Products Reserve for such amount and all other Reserved
Secured Hedge Obligations and Reserved Secured Cash Management Obligations would not result in an Overadvance and (b) the Borrower
has been notified of and given a least three Business Days to review any error in the calculation of such maximum amount and increased
amount.
“Reserved Secured Hedge Obligations” means any Obligations in respect of any Hedge Agreement owing to a Hedge Bank, up
to the maximum amount owing thereunder as specified by the applicable Hedge Bank in writing to the Administrative Agent, which amount
may be increased with respect to any existing Secured Hedge Agreement at any time by further written notice from such Hedge Bank to the
Administrative Agent; provided that(a) such Obligations are subject to a Bank Product Reserve so long as the establishment of such Bank
Products Reserve for such amount and all other Reserved Secured Hedge Obligations and Reserved Secured Cash Management Obligations
would not result in an Overadvance and (b) the Borrower has been notified of and given a least three Business Days to review any error in the
calculation of such maximum amount and increased amount.
“Reserves” means the Bank Products Reserve, the Landlord Lien Reserve, the Maturing Indebtedness Reserve, the Canadian
Priority Payables Reserve and any and all other reserves established in accordance with and subject to Section 2.22 that reflect risks or
contingencies that are reasonably likely to (a) affect the collectability of Eligible Accounts Receivable or Eligible Credit Insured Accounts,
(b) affect the salability of Eligible Inventory, (c) impair the value of the Eligible Accounts Receivable, Eligible Credit Insured Accounts,
Eligible Inventory or the Collateral Agent’s Lien thereon or (d) result in the payment of unanticipated liabilities of any Loan Party. Without
limiting the generality of the foregoing but subject to Section 2.22, the Administrative Agent may establish dilution reserves, freight and
shipping charges related to any Inventory in transit, reserves for unpaid and accrued sales taxes, reserves for banker’s liens, rights of setoff or
similar rights and remedies as to deposit or investment accounts, reserves for contingent liabilities of any Loan Party, reserves for uninsured
or underinsured losses or litigation of any Loan Party, reserves for customs charges, reserves for fees, assessments, and other governmental
charges with respect to the Eligible Accounts Receivable, and reserves for self-insurance and insurance premiums.
“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution
Authority.
“Responsible Officer” means the executive chairman, chief executive officer, president, senior vice president, senior vice
president (finance), vice president, chief financial officer, treasurer, manager of treasury activities or assistant treasurer or other similar
officer or Person performing similar functions of a Loan Party and, solely for purposes of notices given pursuant to Article II, any other
officer or employee of the applicable Loan Party so designated by any of the foregoing officers in a notice to the Administrative Agent or any
other officer or employee of the applicable Loan Party designated in or pursuant to an agreement between the applicable Loan Party and the
Administrative Agent, and, as to any document delivered on the Closing Date, any secretary or assistant secretary of a Loan Party. Any
document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been
authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be
conclusively presumed to have acted on behalf of such Loan Party. Unless otherwise specified, all references herein to a “Responsible
Officer” shall refer to a Responsible Officer of the Borrower.
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“Restricted” means, when referring to cash or Cash Equivalents of the Borrower or any of the Restricted Subsidiaries, that such
cash or Cash Equivalents appear (or would be required to appear) as “restricted” on a consolidated balance sheet of the Borrower or such
Restricted Subsidiary (unless such appearance is related to a restriction in favor of, the Administrative Agent, the Collateral Agent or any
Lender).
“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any
Equity Interest of the Borrower or any of the Restricted Subsidiaries (in each case, solely to a holder of Equity Interests in such Person’s
capacity as a holder of such Equity Interests other than dividends or distributions payable solely in Equity Interests (other than Disqualified
Equity Interests) of the Borrower), or any payment (whether in cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, defeasance, acquisition, cancellation or termination of any such Equity Interest,
or on account of any return of capital to the Borrower’s stockholders, partners or members (or the equivalent Persons thereof). For the
avoidance of doubt, the payment of any Contractual Obligation that is based on, or measured with respect to the value of an Equity Interest,
including any such Contractual Obligations constituting compensation arrangements, shall not be considered a Restricted Payment. The
amount of any Restricted Payment not made in cash or Cash Equivalents shall be the fair market value of the securities or other property
distributed by dividend or other otherwise.
“Restricted Subsidiary” means any Subsidiary of the Borrower other than an Unrestricted Subsidiary, for the avoidance of doubt,
including each Co-Borrower and Guarantor.
“Revolving Commitment” means the Tranche 1 Revolving Commitments and the Tranche 2 Revolving Commitments.
“Revolving Commitment Period” means the period from the Closing Date to but excluding the Revolving Commitment
Termination Date.
“Revolving Commitment Termination Date” with respect to either the Tranche 1 Revolving Commitments or Tranche 2
Revolving Commitments, means the earliest to occur of (a) the fifth anniversary of the Closing Date, (b) the date the applicable Revolving
Commitments, including Tranche 1 Revolving Commitments in respect of Letters of Credit and Swing Line Loans, are permanently reduced
to zero pursuant to Section 2.08, and (c) the date of the termination of the applicable Revolving Commitments pursuant to Section 9.02.
“Revolving Exposure” means the Tranche 1 Revolving Exposure and the Tranche 2 Revolving Exposure.
“Revolving Facility” means the Tranche 1 Revolving Facility and the Tranche 2 Revolving Facility.
“Revolving Lenders” means the Tranche 1 Revolving Lenders and the Tranche 2 Revolving Lenders.
“Revolving Loan Notes” means the Tranche 1 Revolving Loan Notes and the Tranche 2 Revolving Loan Notes.
“Revolving Loans” means the Tranche 1 Revolving Loans and the Tranche 2 Revolving Loans.
“S&P” means Standard & Poor’s, a division of S&P Global Inc., and any successor thereto.
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“Sale Leaseback Transaction” means a sale leaseback transaction with respect to all or any portion of any real property,
equipment or capital assets owned by a Loan Party or other property customarily included in such transactions.
“Same Day Funds” means disbursements and payments in immediately available funds.
“Sanctions” means any sanction administered or enforced by the United States government (including OFAC), the Government of
Canada, the United Nations Security Council, the European Union or HMT.
“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to, or exercising jurisdiction
outside of the United States, any of its principal functions.
“Secured Cash Management Services” means any Cash Management Services entered into by and among the Borrower or any
Restricted Subsidiary and any Cash Management Bank.
“Secured Hedge Agreement” means any Hedge Agreement that is entered into by and between any Loan Party and any Hedge
Bank and designated in writing by the Hedge Bank and the Borrower to the Administrative Agent as a “Secured Hedge Agreement” (but
only if such Hedge Agreement has not been designated as a “Secured Hedge Agreement” under the Term Loan Credit Agreement).
“Secured Net Leverage Ratio” means, with respect to any Test Period, the ratio of (a) Consolidated Secured Net Debt
outstanding as of the last day of such Test Period to (b) Consolidated Adjusted EBITDA of the Borrower for such Test Period.
“Secured Obligations” has the meaning given to such term in the Security Agreement or the Canadian Security Agreement, as
applicable.
“Secured Parties” means, collectively, the Administrative Agent, the Collateral Agent, the Lenders, each Issuing Bank, each
Hedge Bank party to a Secured Hedge Agreement, each Cash Management Bank party to an agreement governing Cash Management
Obligations, the Supplemental Administrative Agent and each co-agent or sub-agent appointed by the Administrative Agent from time to
time pursuant to Section 10.05 and Section 10.12.
“Securities Act” means the U.S. Securities Act of 1933, as amended.
“Securitization Assets” means the accounts receivable, royalty or other revenue streams, other rights to payment (including with
respect to rights of payment pursuant to the terms of Joint Ventures) subject to a Qualified Securitization Financing and the proceeds thereof.
“Securitization Fees” means distributions or payments made directly or by means of discounts with respect to any participation
interest issued or sold in connection with, and other fees paid to a Person that is not a Securitization Subsidiary in connection with any
Qualified Securitization Financing.
“Securitization Financing” means any transaction or series of transactions that may be entered into by the Borrower or any of its
Subsidiaries pursuant to which the Borrower or any of its Subsidiaries may sell, convey or otherwise transfer to (a) a Securitization
Subsidiary (in the case of a transfer by the Borrower or any of its Subsidiaries) or (b) any other Person (in the case of a transfer by a
Securitization Subsidiary), or may grant a security interest or Lien in, any Securitization Assets of the Borrower or any of its Subsidiaries,
and any assets related thereto, including all collateral securing such Securitization Assets, all contracts and all guarantees or other obligations
in respect of such Securitization Assets, proceeds of
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such Securitization Assets and other assets that are customarily transferred or in respect of which security interests are customarily granted in
connection with asset securitization transactions involving Securitization Assets as determined by the Borrower in good faith.
“Securitization Repurchase Obligation” means any obligation of a seller or transferor of Securitization Assets in a Qualified
Securitization Financing to repurchase Securitization Assets arising as a result of a breach of a Standard Securitization Undertaking,
including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, offset or counterclaim of any kind
as a result of any action taken by, any failure to take action by or any other event relating to the seller.
“Securitization Subsidiary” means a wholly owned Subsidiary of the Borrower (or another Person formed for the purposes of
engaging in a Qualified Securitization Financing in which the Borrower or any Subsidiary of the Borrower makes an Investment and to
which the Borrower or any Subsidiary of the Borrower transfers Securitization Assets and related assets) that engages in no activities other
than in connection with the financing of Securitization Assets of the Borrower or its Subsidiaries, all proceeds thereof and all rights
(contingent and other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and
which is designated by the Board of Directors of the Borrower or such other Person (as provided below) as a Securitization Subsidiary, and
(a)
no portion of the Indebtedness or any other obligation (contingent or otherwise) of which (i) is guaranteed by
Holdings, the Borrower or any other Subsidiary of the Borrower, other than another Securitization Subsidiary (excluding
guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization
Undertakings), (ii) is recourse to or obligates Holdings, the Borrower or any other Subsidiary of the Borrower, other than another
Securitization Subsidiary, in any way other than pursuant to Standard Securitization Undertakings or (iii) subjects any property or
asset of Holdings, the Borrower or any other Subsidiary of the Borrower, other than another Securitization Subsidiary, directly or
indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings;
(b)
with which none of Holdings, the Borrower or any other Subsidiary of the Borrower, other than another
Securitization Subsidiary, has any material contract, agreement, arrangement or understanding other than on terms which the
Borrower reasonably believes to be no less favorable to Holdings, the Borrower or such Subsidiary than those that might be
obtained at the time from Persons that are not Affiliates of the Borrower; and
(c)
to which none of Holdings, the Borrower or any other Subsidiary of the Borrower, other than another
Securitization Subsidiary, has any obligation to maintain or preserve such entity’s financial condition or cause such entity to
achieve certain levels of operating results;
it being agreed that a Securitization Asset consisting of an obligation of or to any Affiliate of a Loan Party (other than another Loan Party or
Restricted Subsidiary, unless otherwise permitted by Section 7.05) shall not result non-compliance with any of the foregoing provisions.
“Security Agreement” means, collectively, the Security Agreement executed by the Loan Parties (other than the Canadian Loan
Parties), substantially in the form of Exhibit F, together with each Security Agreement Supplement executed and delivered pursuant to
Section 6.11.
“Security Agreement Supplement” has the meaning specified in the Security Agreement.
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“Senior Secured Notes” means the notes due 2028 issued by the Borrower pursuant to the Senior Secured Notes Indenture.
“Senior Secured Notes Documents” means the Senior Secured Notes, the Senior Secured Notes Indenture and all other
documents evidencing, guaranteeing or otherwise governing the terms of the Senior Secured Notes.
“Senior Secured Notes Indenture” means that certain Indenture, dated as of October 18, 2021, among the Borrower, as issuer,
the guarantors party thereto and The Bank of New York Mellon, as trustee (as amended, restated, supplemented, or otherwise modified from
time to time) and any supplemental indenture or additional indenture to be entered into with respect to the Senior Secured Notes.
“Short Term Advances” means loans and advances made by Loan Parties having a term not exceeding 364 days (inclusive of any
roll over or extension of terms).
“Similar Business” means any business, the majority of whose revenues are derived from (a) business or activities conducted by
the Borrower and the Restricted Subsidiaries on the Closing Date, (b) any business that is a natural outgrowth or reasonable extension,
development or expansion of any such business or any business similar, reasonably related, incidental, complementary or ancillary to any of
the foregoing or (c) any business that in the Borrower’s good faith business judgment constitutes a reasonable diversification of businesses
conducted by the Borrower and the Restricted Subsidiaries.
“SOFR” means a rate per annum equal to the secured overnight financing rate for such Business Day published by the Federal
Reserve Bank of New York (or a successor administrator of the secured overnight financing rate) on the website of the Federal Reserve Bank
of New York, currently at http://www.newyorkfed.org (or any successor source for the secured overnight financing rate identified as such by
the administrator of the secured overnight financing rate from time to time).
“Solvent” and “Solvency” mean, with respect to any Person on any date of determination, that on such date (a) the fair value of
the assets of such Person, on a consolidated basis with its Subsidiaries, exceeds its debts and liabilities, subordinated, contingent or
otherwise, on a consolidated basis, (b) the present fair saleable value of the property of such Person, on a consolidated basis with its
Subsidiaries, is greater than the amount that will be required to pay the probable liability of its debts and other liabilities, subordinated,
contingent or otherwise, on a consolidated basis, as such debts and other liabilities become absolute and matured, (c) such Person, on a
consolidated basis with its Subsidiaries, is able to pay its debts and liabilities, subordinated, contingent or otherwise, on a consolidated basis,
as such liabilities become absolute and matured and (d) such Person, on a consolidated basis with its Subsidiaries, is not engaged in, and is
not about to engage in, business for which it has unreasonably small capital. The amount of any contingent liability at any time shall be
computed as the amount that would reasonably be expected to become an actual and matured liability.
“SPAC IPO” means the acquisition, purchase, merger, amalgamation or other combination of the Borrower or any Parent Entity
by, or with, a publicly traded special purpose acquisition company or targeted acquisition company or any entity similar to the foregoing (a
“SPAC IPO Entity”) that results in, or following which, any common Equity Interests of the Borrower, any Parent Entity, or such SPAC IPO
Entity (or its successor by merger, amalgamation or other combination) being publicly traded on any United States national securities
exchange or over-the-counter market, or any analogous exchange or market in Canada, the United Kingdom or the European Union.
“SPC” has the meaning specified in Section 11.07(g).
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“Specified ABL Event of Default” means an Event of Default pursuant to Section 9.01(a), Section 9.01(b)(i)(A), Section 9.01(b)
(ii), Section 9.01(b)(iii), Section 9.01(d) (solely with respect to the representation and warranty made in Section 5.20) and Section 9.01(f).
“Specified DDA” means any DDA maintained with a Lender.
“Specified Equity Contribution” has the meaning specified in Section 8.02.
“Specified Event of Default” means an Event of Default pursuant to Section 9.01(a) or an Event of Default pursuant to Section
9.01(f) with respect to the Borrower.
“Specified Excess Availability” means the sum of (a) Excess Availability at such time plus (b) Suppressed Availability (which
shall not be less than zero) at such time; provided that Suppressed Availability shall not exceed 2.5% of the Aggregate Commitments at any
time.
“Specified Representations” means those representations and warranties made by Holdings and the Borrower in Sections 5.01(a)
(with respect to organizational existence only), 5.01(b)(ii), 5.02(a), 5.02(b)(i), 5.04, 5.13, 5.16, 5.17 (with respect to the use of proceeds of
the Loans not in violation of the FCPA and OFAC) and 5.18; provided that such representations shall be made only with respect to the Initial
Borrower and Holdings.
“Specified Transaction” means any of the following identified by the Borrower: (a) transaction or series of related transactions,
including Investments and Acquisition Transactions, that results in a Person becoming a Restricted Subsidiary, (b) any designation of a
Subsidiary as a Restricted Subsidiary or an Unrestricted Subsidiary, (c) any transaction or series of related transactions, including
Dispositions, that results in a Restricted Subsidiary ceasing to be a Subsidiary of the Borrower, (d) any acquisition or disposition of assets
constituting a business unit, line of business or division of another Person or a facility, (e) any material acquisition or disposition, (f) any
restructuring of the business of the Borrower, whether by merger, consolidation, amalgamation or otherwise, (g) any incurrence or
repayment of Indebtedness (other than Indebtedness incurred or repaid under any revolving credit facility in the ordinary course of business
for working capital purposes), (h) any Restricted Payment and (i) transactions of the type given pro forma effect in (i) the Model or (ii) any
quality of earnings report prepared by a nationally recognized accounting firm and furnished to the Administrative Agent in connection with
the Transactions; provided that, at the Borrower’s election, any Specified Transaction having an aggregate value of less than $1,000,000 shall
not be calculated on a “Pro Forma Basis” or after giving “Pro Forma Effect”.
“Specified Transaction Adjustments” has the meaning specified in Section 1.08(c).
“Standard Securitization Undertakings” means representations, warranties, covenants and indemnities entered into by the
Borrower or any Subsidiary of the Borrower that are customary in a Securitization Financing.
“Stated Amount” means, with respect to any Letter of Credit at any time, the aggregate amount available to be drawn thereunder
at such time (regardless of whether any conditions for drawing could then be met).
“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the
denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal established by the FRB to which the Administrative Agent is subject with
respect to the Adjusted Eurocurrency Rate, for Eurocurrency Rate funding (currently referred to as “Eurocurrency Liabilities” in
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Regulation D of the FRB). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurocurrency Rate Loans
shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The
Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.
“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, unlimited liability
company or other entity of which (a) the Equity Interests having ordinary voting power (other than Equity Interests having such power only
by reason of the happening of a contingency) to elect a majority of the Board of Directors of such corporation, partnership, limited liability
company, unlimited liability company or other entity are at the time owned by such Person or (b) more than 50.0% of the Equity Interests are
at the time owned by such Person. Unless otherwise indicated in this Agreement, all references to Subsidiaries will mean Subsidiaries of the
Borrower. No Person shall be considered a Subsidiary of the Borrower unless the Borrower has the ability to Control such Subsidiary.
“Subsidiary Guarantor” or “Subsidiary Loan Party” means any Subsidiary (other than an Excluded Subsidiary) that is required
to be a Guarantor pursuant to the terms of the Loan Documents.
“Successor Borrower” has the meaning specified in Section 7.04(e).
“Successor Holdings” means any successor to Holdings pursuant to Section 7.04(a)(iii), Section 7.04(g)(i) or Section 7.10(b)(ii),
as applicable, together with such Person’s subsequent successors and assigns permitted hereunder.
“Super Majority Lenders” means, as of any date of determination, Lenders having or holding more than 66-2/3% of the
aggregate Revolving Exposure of all Lenders; provided that the aggregate Revolving Exposure of or held by any Defaulting Lender or
Disqualified Lender shall be excluded for purposes of making a determination of Super Majority Lenders at any time.
“Supplemental Administrative Agent” and “Supplemental Administrative Agents” have the meanings specified in
Section 10.12(a).
“Supported QFC” has the meaning specified in Section 11.26(a).
“Suppressed Availability” means, the amount, if positive, by which the Borrowing Base exceeds the Aggregate Commitments.
“Swap Obligations” 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.
“Swap Termination Value” means, in respect of any one or more Hedge Agreements, after taking into account the effect of any
legally enforceable netting agreement relating to such Hedge Agreements, (a) for any date on or after the date such Hedge Agreements have
been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date
referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one
or more mid-market or other readily available quotations provided by any recognized dealer in such Hedge Agreements (which may include a
Lender or any Affiliate of a Lender).
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“Swing Line Lender” means Barclays Bank PLC, in its capacity as the Swing Line Lender hereunder, together with its permitted
successors and assigns in such capacity.
“Swing Line Loan” means the swing line loan made by the Swing Line Lender to the Borrower or any Co-Borrower pursuant to
Section 2.03.
“Swing Line Loan Request” means a Swing Line Loan Request substantially in the form of Exhibit A-4, or such other form as
approved by the Administrative Agent (including any form on an electronic platform or electronic transmission system as shall be approved
by the Administrative Agent), appropriately completed and signed by a Responsible Officer of the Borrower or applicable Co-Borrower.
“Swing Line Note” means a promissory note in the form of Exhibit B-3, as it may be amended, restated, supplemented or
otherwise modified from time to time.
“Swing Line Sublimit” means the greater of (a) $25,000,000 and (b) such higher amount as the Borrower and the Administrative
Agent may from time to time agree.
“Taxes” has the meaning specified in Section 3.01(a). “Term Loan” has the meaning assigned to such term in the Term Loan
Credit Agreement (as in effect on the date hereof).
“Term Loan Agent” means Barclays Bank PLC, in its capacity as administrative agent and collateral agent in respect of the Term
Loan Credit Agreement, together with its successors and assigns in such capacity, or any successor administrative agent and/or collateral
agent under the Term Loan Documents.
“Term Loan Credit Agreement” means the (i) term loan credit agreement, to be entered into as of the Closing Date, among
Holdings, the Borrower, the lenders party thereto and the Term Loan Agent, as such document may be amended, restated, supplemented or
otherwise modified from time to time (ii) any other credit agreement, loan agreement, note agreement, promissory note, indenture or other
agreement or instrument evidencing or governing the terms of any Indebtedness or other financial accommodation that has been incurred to
refinance, restructure, replace, renew, increase or extend from time to time (subject to the limitations set forth herein (including by reference
to the Closing Date ABL Intercreditor Agreement)) in whole or in part the Indebtedness and other obligations outstanding under (x) the credit
agreement referred to in clause (i) or (y) any subsequent Term Loan Credit Agreement, unless such agreement or instrument expressly
provides that it is not intended to be and is not a Term Loan Credit Agreement hereunder. Any reference to the Term Loan Credit Agreement
hereunder shall be deemed a reference to any Term Loan Credit Agreement then in existence.
“Term Loan Documents” means the Term Loan Credit Agreement and the other “Loan Documents” as defined in the Term Loan
Credit Agreement, as each such document may be amended, restated, supplemented or otherwise modified from time to time or refinanced,
restructured, replaced, renewed, increased or extended from time, unless such agreement or instrument expressly provides that it is not
intended to be and is not a Term Loan Document hereunder.
“Term Loan Facility” means any “Facility” as defined in the Term Loan Credit Agreement (as in effect on the date hereof).
“Term Loan Obligations” means the “Obligations” as defined in the Term Loan Credit Agreement (as in effect on the date
hereof).
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“Term Priority Collateral” means the “Fixed Asset Collateral” as defined in the Closing Date ABL Intercreditor Agreement.
“Term SOFR” means, for the applicable corresponding tenor, the forward-looking term rate based on SOFR that has been
selected or recommended by the Relevant Governmental Body.
“Termination Conditions” means, collectively, (a) the payment in full in cash of the Obligations (other than (i) contingent
indemnification obligations as to which no claim has been asserted, (ii) Obligations under Secured Hedge Agreements not then due and
payable pursuant to Section 9.03 and (iii) Cash Management Obligations not then due and payable pursuant to Section 9.03) and (b) the
termination of the Commitments and the termination or expiration of all Letters of Credit under this Agreement (unless backstopped or Cash
Collateralized in an amount equal to 103% of the maximum drawable amount of any such Letter of Credit or otherwise in an amount and/or
in a manner reasonably acceptable to the Issuing Banks).
“Test Period” in effect at any time means the most recent period of four consecutive fiscal quarters of the Borrower ended on or
prior to such time (taken as one accounting period) in respect of which financial statements for each quarter or fiscal year in such period are
available (which may be internal financial statements except to the extent this Agreement otherwise expressly states that the Test Period is
specified in a Compliance Certificate, in which case such financial statements shall have been delivered pursuant to Section 6.01(a) or (b) for
the Test Period set forth in such Compliance Certificate). A Test Period may be designated by reference to the last day thereof (i.e., the
‘December 31st Test Period’ of a particular year refers to the period of four consecutive fiscal quarters of the Borrower ended on December
31st of such year), and a Test Period shall be deemed to end on the last day thereof.
“Threshold Amount” means (x) other than for purposes of Section 9.01, the greater of (a) 25% of Closing Date EBITDA and (b)
25% of TTM Consolidated Adjusted EBITDA and (y) for purposes of Section 9.01, the greater of (a) 10% of Closing Date EBITDA and (b)
10% of TTM Consolidated Adjusted EBITDA.
“Total Net Leverage Ratio” means, with respect to any Test Period, the ratio of (a) Consolidated Net Debt as of the last day of
such Test Period to (b) Consolidated Adjusted EBITDA of the Borrower for such Test Period.
“Total Utilization of Revolving Commitments” means, as of any date of determination, the sum of (i) the aggregate principal
amount of all outstanding Revolving Loans other than Tranche 1 Revolving Loans made for the purpose of repaying any Refunded Swing
Line Loans or reimbursing the Issuing Banks for any amount drawn under any Letter of Credit, but not yet so applied, (ii) the aggregate
principal amount of all outstanding Swing Line Loans and (iii) the Letter of Credit Usage.
“Total Utilization of Tranche 1 Revolving Commitments” means, as of any date of determination, the sum of (i) the aggregate
principal amount of all outstanding Tranche 1 Revolving Loans other than Tranche 1 Revolving Loans made for the purpose of repaying any
Refunded Swing Line Loans or reimbursing the Issuing Banks for any amount drawn under any Letter of Credit, but not yet so applied, (ii)
the aggregate principal amount of all outstanding Swing Line Loans and (iii) the Letter of Credit Usage.
“Traded Securities” means any debt or equity securities issued pursuant to a public offering or Rule 144A offering.
“Tranche 1 Revolving Commitment” means the commitment of a Tranche 1 Revolving Lender to make or otherwise fund any
Tranche 1 Revolving Loan and to acquire participations in Letters of Credit
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and Swing Line Loans hereunder and “Tranche 1 Revolving Commitments” means such commitments of all Tranche 1 Revolving Lenders in
the aggregate. The amount of each Tranche 1 Lender’s Tranche 1 Revolving Commitment, if any, is set forth on Schedule 2.01 under the
caption “Tranche 1 Revolving Commitment” or in the applicable Assignment and Assumption, subject to any increase, adjustment or
reduction pursuant to the terms and conditions hereof including Section 2.16. The aggregate amount of the Tranche 1 Revolving
Commitments as of the Closing Date is $380,000,000.
“Tranche 1 Revolving Exposure” means, with respect to any Tranche 1 Revolving Lender as of any date of determination,
(a) prior to the termination of the Tranche 1 Revolving Commitments, that Tranche 1 Revolving Lender’s Tranche 1 Revolving Commitment;
and (b) after the termination of the Tranche 1 Revolving Commitments, the sum of (i) the aggregate outstanding principal amount of the
Tranche 1 Revolving Loans of that Tranche 1 Revolving Lender, (ii) in the case of each Issuing Bank, the aggregate Letter of Credit Usage in
respect of all Letters of Credit issued by that Lender (net of any participations by Lenders in such Letters of Credit), (iii) the aggregate
amount of all participations by that Lender in any outstanding Letters of Credit or any unreimbursed drawing under any Letter of Credit,
(iv) in the case of the Swing Line Lender, the aggregate outstanding principal amount of all Swing Line Loans (net of any participations
therein by other Lenders) and (v) the aggregate amount of all participations therein by that Lender in any outstanding Swing Line Loans.
“Tranche 1 Revolving Facility” means the Facility comprised of the Tranche 1 Revolving Commitments, Tranche 1 Revolving
Loans, Swing Line Loans and Letters of Credit hereunder.
“Tranche 1 Revolving Lender” means a Lender having a Tranche 1 Revolving Commitment or other Tranche 1 Revolving
Exposure.
“Tranche 1 Revolving Loan Note” means a promissory note in the form of Exhibit B-1, as it may be amended, restated,
supplemented or otherwise modified from time to time.
“Tranche 1 Revolving Loans” has the meaning specified in Section 2.01(a).
“Tranche 2 Revolving Commitment” means the commitment of a Tranche 2 Revolving Lender to make or otherwise fund any
Tranche 2 Revolving Loan hereunder and “Tranche 2 Revolving Commitments” means such commitments of all Tranche 2 Revolving
Lenders in the aggregate. The amount of each Tranche 2 Revolving Lender’s Tranche 2 Revolving Commitment, if any, is set forth on
Schedule 2.01 under the caption “Tranche 2 Revolving Commitment” or in the applicable Assignment and Assumption, subject to any
increase, adjustment or reduction pursuant to the terms and conditions hereof including Section 2.16. The aggregate amount of the Tranche 2
Revolving Commitments as of the Closing Date is $20,000,000.
“Tranche 2 Revolving Exposure” means, with respect to any Tranche 2 Revolving Lender as of any date of determination,
(a) prior to the termination of the Tranche 2 Revolving Commitments, that Tranche 2 Revolving Lender’s Tranche 2 Revolving Commitment;
and (b) after the termination of the Tranche 2 Revolving Commitments, the aggregate outstanding principal amount of the Tranche 2
Revolving Loans of that Lender.
“Tranche 2 Revolving Facility” means the Facility comprised of the Tranche 2 Revolving Commitments and Tranche 2
Revolving Loans hereunder.
“Tranche 2 Revolving Lender” means a Lender having a Tranche 2 Revolving Commitment or other Tranche 2 Revolving
Exposure.
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“Tranche 2 Revolving Loan Note” means a promissory note in the form of Exhibit B-2, as it may be amended, restated,
supplemented or otherwise modified from time to time.
“Tranche 2 Revolving Loans” has the meaning specified in Section 2.01(a).
“Transaction Expenses” means any fees or expenses incurred or paid by Holdings or any of its Subsidiaries in connection with
the Transactions, this Agreement and the other Loan Documents and the transactions contemplated hereby and thereby, including any
amortization thereof in any period, including any amortization thereof in any period.
“Transactions” means, collectively, the funding of the Initial Term Loans under the Term Loan Facility, the issuance of notes
under the Senior Secured Notes Indenture, the receipt of the Revolving Commitments and funding of the Initial Revolving Borrowing, the
Closing Date Refinancing, the Equity Contribution, the consummation of the Acquisition, including all payments to the holders of the Equity
Interests of the Acquired Business in connection therewith, and the payment of the Transaction Expenses.
“Treasury Equity Interests” has the meaning specified in Section 7.06(o).
“Trust Fund Account” means any account containing cash consisting solely of Trust Funds.
“Trust Fund Certificate” means a certificate of a Responsible Officer of the Borrower certifying (a) the type and amount of any
Trust Funds (other than payroll and employee benefit payments, in each case, in the nature of discretionary contributions) contained or held
in a Blocked Account, (b) that the failure to remit such Trust Funds to the Person entitled thereto could reasonably be expected to result in
personal, criminal or civil liability to any director, officer or employee of any Loan Party or any Subsidiary of any Loan Party under any
applicable Law and (c) that (x) the obligation requiring such Trust Funds is due and payable within 10 Business Days of delivery of such
certificate and (y) amounts on deposit in any applicable Trust Fund Account are insufficient to make such payment.
“Trust Funds” means any cash or Cash Equivalents or other investment property comprised of (a) funds used or to be used for
payroll and payroll taxes and other employee benefit payments to or for the benefit of any Loan Party’s employees, (b) funds used or to be
used to pay all Taxes required to be collected, remitted or withheld (including, without limitation, federal, state, provincial and other
withholding Taxes (including the employer’s share thereof)) and (c) any other funds which any Loan Party (i) holds on behalf of another
Person (other than Holdings or any of its Subsidiaries) or (ii) holds as an escrow or fiduciary for another Person (other than Holdings or any
of its Subsidiaries).
“TTM Consolidated Adjusted EBITDA” means, as of any date of determination, the Consolidated Adjusted EBITDA of the
Borrower and the Restricted Subsidiaries, determined on a Pro Forma Basis, for the most recent Test Period.
“Type” means, with respect to a Loan, its character as a Base Rate Loan or a Eurocurrency Rate Loan.
“UK Financial Institution” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from
time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person subject to IFPRU 11.6 of the FCA
Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit
institutions and investment firms, and certain affiliates of such credit institutions or investment firms.
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“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the
resolution of any UK Financial Institution.
“U.S. Lender” has the meaning specified in Section 3.01(e).
“U.S. Special Resolution Regimes” has the meaning specified in Section 11.26(a).
“Undisclosed Administration” means, in relation to a Lender or its direct or indirect parent entity, the appointment of an
administrator, provisional liquidator, conservator, receiver, trustee, custodian, or other similar official by a supervisory authority or regulator
under or based on the law in the country where such Lender or such parent entity is subject to home jurisdiction supervision, if applicable law
requires that such appointment not be disclosed.
“Unfunded Advances/Participations” means (a) with respect to the Administrative Agent, the aggregate amount, if any (i) made
available to the Borrower or any Co-Borrower on the assumption that each Lender has made available to the Administrative Agent such
Lender’s share of the applicable Borrowing available to the Administrative Agent as contemplated by Sections 2.01(b)(ii) and (ii) with
respect to which a corresponding amount shall not in fact have been returned to the Administrative Agent by the Borrower or Co-Borrower or
made available to the Administrative Agent by any such Lender, (b) with respect to the Swing Line Lender, the aggregate amount, if any, of
outstanding Swing Line Loans in respect of which any Tranche 1 Revolving Lender fails to make available to the Administrative Agent for
the account of the Swing Line Lender any amount required to be paid by such Lender pursuant to Section 2.03(c) and (c) with respect to the
Issuing Banks, the aggregate amount, if any, of amounts drawn under Letters of Credit in respect of which a Tranche 1 Revolving Lender
shall have failed to make amounts available to the applicable Issuing Banks pursuant to Section 2.04(c).
“Unfunded Holdbacks” means any contingent purchase price payment obligations in connection with any Permitted Investment.
“Uniform Commercial Code” means the Uniform Commercial Code or any successor provision thereof as the same may from
time to time be in effect in the State of New York or the Uniform Commercial Code or any successor provision thereof (or similar code or
statute) of another jurisdiction, to the extent it may be required to apply to any item or items of Collateral.
“United States” and “U.S.” mean the United States of America.
“Unrestricted Subsidiary” means (a) each Securitization Subsidiary and (b) any Subsidiary of the Borrower designated by the
Board of Directors of the Borrower as an Unrestricted Subsidiary pursuant to Section 6.13 subsequent to the date hereof and each Subsidiary
of such Subsidiary, in each case, until such Person ceases to be an Unrestricted Subsidiary of the Borrower in accordance with Section 6.13
or ceases to be a Subsidiary of the Borrower.
“USA PATRIOT Act” means The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (Title III of Public Law No. 107-56 (signed into law October 26, 2001)), as amended or modified from time
to time.
“USD LIBOR” means the London interbank offered rate for U.S. dollars.
“Value” means, with respect to any Inventory, its value determined on the basis of the lower of cost or market, calculated on a
moving average cost basis, and excluding any portion of cost attributable to intercompany profit among the Borrower and its Affiliates.
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“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by
dividing:
(a)
the sum of the products obtained by multiplying (i) the amount of each then remaining installment, sinking
fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by
(b)
the then outstanding principal amount of such Indebtedness;
provided that for purposes of determining the Weighted Average Life to Maturity of (i) any Permitted Refinancing, (ii) any Indebtedness that
is being modified, refinanced, refunded, renewed, replaced or extended, or (iii) any term loans for purposes of incurring any other
Indebtedness (in any such case, the “Applicable Indebtedness”), the effects of any amortization payments or other prepayments made on
such Applicable Indebtedness (including the effect of any prepayment on remaining scheduled amortization) prior to the date of the
applicable modification, refinancing, refunding, renewal, replacement, extension or incurrence shall be disregarded.
“WF” has the meaning specified in the introductory paragraph to this Agreement.
“wholly owned” means, with respect to a Subsidiary of a Person, a Subsidiary of such Person all of the outstanding Equity
Interests of which (other than (a) director’s qualifying shares and (b) nominal shares issued to foreign nationals to the extent required by
applicable Law) are owned by such Person and/or by one or more wholly owned Subsidiaries of such Person.
“Withdrawal Liability” means the liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
“Withholding Agent” means the Borrower, any Guarantor, the Administrative Agent or any other applicable withholding agent.
“Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority, the write-down and
conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United
Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a
liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability
into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a
right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation
that are related to or ancillary to any of those powers.
Section 1.02
Other Interpretive Provisions
. With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan
Document:
(a)
The meanings of defined terms are equally applicable to the singular and plural forms of the defined terms.
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(b)
(i) The words “herein,” “hereto,” “hereof” and “hereunder” and words of similar import when used in any Loan
Document shall refer to such Loan Document as a whole and not to any particular provision thereof;
(i)
references in this Agreement to an Exhibit, Schedule, Article, Section, clause or sub-clause refer (A) to the
appropriate Exhibit or Schedule to, or Article, Section, clause or sub-clause in this Agreement or (B) to the extent such references
are not present in this Agreement, to the Loan Document in which such reference appears;(iii) the term “including” is by way of
example and not limitation;(iv) the term “documents” includes any and all instruments, documents, agreements, certificates,
notices, reports, financial statements and other writings, however evidenced, whether in physical or electronic form;(v) the phrase
“permitted by” and the phrase “not prohibited by” shall be synonymous, and any transaction not specifically prohibited by the
terms of the Loan Documents shall be deemed to be permitted by the Loan Documents; (vi) the phrase “commercially reasonable
efforts” shall not require the payment of a fee or other amount to any third party or the incurrence of any expense or liability by a
Loan Party (or Affiliate) outside its ordinary course of its business; (vii) the phrase “in good faith” when used with respect to a
determination made by a Loan Party shall mean that such determination was made in the prudent exercise of its commercial
judgment and shall be deemed to be conclusive if fully disclosed in writing (in reasonable detail) to the Administrative Agent and
the Lenders and neither the Administrative Agent nor the Required Lenders have objected to such determination within ten
Business Days of such disclosure to the Administrative Agent and the Lenders; (viii) in the computation of periods of time from a
specified date to a later specified date, the word “from” means “from and including;” the words “to” and “until” each mean “to but
excluding;” and the word “through” means “to and including” and(ix) term “continuing” means, with respect to a Default or Event
of Default, that it has not been cured (including by performance) or waived.
(c)
Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not
affect the interpretation of this Agreement or any other Loan Document.
(d)
For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law
(or any comparable event under a different jurisdiction’s laws) (a “Division”), if (a) any asset, right, obligation or liability of any Person
becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person
to the subsequent Person, and (b) any new Person comes into existence, such new Person shall be deemed to have been organized on the first
date of its existence by the holders of its Equity Interests at such time.
(e)
[reserved].
(f)
For purposes of any Collateral located in the Province of Quebec or charged by any deed of hypothec (or any other
Loan Document) and for all other purposes pursuant to which the interpretation or construction of a Loan Document may be subject to the
laws of the Province of Quebec or a court or tribunal exercising jurisdiction in the Province of Quebec, (i) “personal property” shall be
deemed to include “movable property”, (ii) “real estate” or “real property” shall be deemed to include “immovable property”, (iii) “tangible
property” shall be deemed to include “corporeal property”, (iv) “intangible property” shall be deemed to include “incorporeal property”, (v)
“security interest”, “mortgage” and “lien” shall be deemed to include a “hypothec”, “prior claim” and a “resolutory clause”, (vi) all
references to filing, registering or recording under the UCC or the PPSA shall be deemed to include publication under the Civil Code of
Quebec, and any reference to a “financing statement” shall be deemed to include a reference to an application for publication under the Civil
Code of Quebec, (vii) all references to “perfection” of or “perfected” Liens shall be deemed to include a reference to an “opposable” or “set
up” Liens as against third parties, (viii) any “right of offset”, “right of setoff” or similar expression shall be
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deemed to include a “right of compensation”, (ix) “goods” shall be deemed to include “corporeal movable property” other than chattel paper,
documents of title, instruments, money and securities, (x) an “agent” shall be deemed to include a “mandatary”, (xi) “construction liens” shall
be deemed to include “legal hypothecs”, (xii) “joint and several” shall be deemed to include “solidary”, (xiii) “gross negligence or willful
misconduct” shall be deemed to be “intentional or gross fault”, (xiv) “beneficial ownership” shall be deemed to include “ownership on behalf
of another as mandatary”, (xv) “servitude” shall be deemed to include “easement”, (xvi) “priority” shall be deemed to include “prior claim”,
(xvii) “survey” shall be deemed to include “certificate of location and plan”, (xviii) “fee simple title” shall be deemed to include “absolute
ownership”, (xix) “foreclosure” shall be deemed to include “the exercise of a hypothecary right” and (xx) “lease” shall be deemed to include
a “leasing” (crédit-bail). The parties hereto confirm that it is their wish that this Agreement and any other document executed in connection
with the transactions contemplated herein be drawn up in the English language only (except if another language is required under any
applicable Law) and that all other documents contemplated thereunder or relating thereto, including notices, may also be drawn up in the
English language only. Les parties aux présentes confirment que c’est leur volonté que cette convention et les autres documents de crédit
soient rédigés en anglais seulement et que tous les documents, y compris tous avis, envisagés par cette convention et les autres documents
peuvent être rédigés en anglais seulement (sauf si une autre langue est requise en vertu d’une loi applicable).
Section 1.03
Accounting and Finance Terms; Accounting Periods; Unrestricted Subsidiaries; Determination of Fair Market
Value
. All accounting terms, financial terms or components of such terms not specifically or completely defined herein shall be
construed in conformity with GAAP to the extent GAAP defines such term or a component of such term. To the extent GAAP does not
define any such term or a component of any such term, such term shall be calculated by the Borrower in good faith. For purposes of
calculating any consolidated amounts necessary to determine compliance by any Person and, if applicable, its Restricted Subsidiaries with
any ratio or other financial covenant in this Agreement, Unrestricted Subsidiaries shall be excluded. Unless the context indicates otherwise,
any reference to a “fiscal year” shall refer to a fiscal year of the Borrower ending December 31 and any reference to a “fiscal quarter” shall
refer to a fiscal quarter of the Borrower ending March 31, June 30, September 30 or December 31. All determinations of fair market value
under a Loan Document shall be made by the Borrower in good faith and, if such determination is consistent with a valuation or opinion of
an Independent Financial Advisor, such determination shall be conclusive for all purposes under the Loan Documents or related to the
Obligations.
Section 1.04
Rounding
. Any financial ratios required to be satisfied in order for a specific action to be permitted under this Agreement shall be
calculated by dividing the appropriate component by the other component, carrying the result to one decimal place more than the number of
decimal places by which such ratio is expressed herein (the “Applicable Decimal Place”) and rounding the result up or down to the
Applicable Decimal Place.
Section 1.05
References to Agreements, Laws, Etc.
Unless otherwise expressly provided herein, (a) references to Organization Documents, agreements (including the Loan
Documents) and other contractual instruments shall be deemed to include all subsequent amendments, restatements, extensions, supplements
and other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications
are permitted by this Agreement (including by way of amendment and/or waiver); 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 New York City time (daylight or standard,
as applicable).
Section 1.07
[Reserved]
.
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Section 1.08
Pro Forma Calculations; Limited Condition Transactions; Basket and Ratio Compliance
.
(a)
Notwithstanding anything to the contrary herein, the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio,
the Total Net Leverage Ratio and the Fixed Charge Coverage Ratio shall be calculated in the manner prescribed by this Section 1.08;
provided, that notwithstanding anything to the contrary in clause (b), (c) or (d) of this Section 1.08, when calculating the Fixed Charge
Coverage Ratio for purposes of Section 8.01, the events described in this Section 1.08 that occurred subsequent to the end of the applicable
Test Period shall not be given pro forma effect.
(b)
For purposes of calculating the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio, the Total Net Leverage
Ratio and the Fixed Charge Coverage Ratio, Specified Transactions identified by the Borrower that have been made (i) during the applicable
Test Period or (ii) subsequent to such Test Period and prior to or simultaneously with the event for which the calculation of any such ratio is
made shall be calculated on a pro forma basis assuming that all such Specified Transactions (and any increase or decrease in Consolidated
Adjusted EBITDA and the component financial definitions used therein attributable to any Specified Transaction) had occurred on the first
day of the applicable Test Period. If since the beginning of any applicable Test Period any Person that subsequently became a Restricted
Subsidiary or was merged, amalgamated or consolidated with or into the Borrower or any of its Restricted Subsidiaries since the beginning of
such Test Period shall have consummated any Specified Transaction identified by the Borrower that would have required adjustment pursuant
to this Section 1.08, then the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio, the Total Net Leverage Ratio and the Fixed
Charge Coverage Ratio shall be calculated to give pro forma effect thereto in accordance with this Section 1.08.
(c)
Whenever pro forma effect is to be given to a Specified Transaction, the pro forma calculations shall be made in good
faith by a Responsible Officer and may include, for the avoidance of doubt, the amount of cost savings, operating expense reductions;
synergies, material changes to amounts to be paid by or received by Loan Parties projected by the Borrower in good faith to be realized as a
result of specified actions taken, committed to be taken or expected to be taken (calculated on a pro forma basis as though amounts had been
realized on the first day of such Test Period and as if any such cost savings, operating expense reductions and synergies were realized during
the entirety of such period) relating to such Specified Transaction, net of the amount of actual benefits realized during such period from such
actions (such amounts, “Specified Transaction Adjustments”); provided that (i) such Specified Transaction Adjustments are reasonably
identifiable and quantifiable in the good faith judgment of the Borrower (it being agreed that such determination need not be made in
compliance with Regulation S-X or other applicable securities laws), (ii) such actions are taken, committed to be taken or expected to be
taken no later than thirty-six months after the date of such Specified Transaction, and (iii) no amounts shall be included pursuant to this
clause (c) to the extent duplicative of any amounts that are otherwise included in calculating Consolidated Adjusted EBITDA, whether
through a pro forma adjustment or otherwise, with respect to any Test Period.
(d)
In the event that the Borrower or any Restricted Subsidiary incurs (including by assumption or guarantees) or repays
(including by redemption, repayment, retirement or extinguishment) any Indebtedness included in the calculations of the First Lien Net
Leverage Ratio, the Secured Net Leverage Ratio, the Total Net Leverage Ratio and the Fixed Charge Coverage Ratio, as the case may be (in
each case, other than Indebtedness incurred or repaid under any revolving credit facility in the ordinary course of business for working capital
purposes), (i) during the applicable Test Period or (ii) subsequent to the end of the applicable Test Period and prior to or simultaneously with
the event for which the calculation of any such ratio is made, then the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio, the
Total Net Leverage Ratio and the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such
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incurrence or repayment of Indebtedness, to the extent required, as if the same had occurred on the last day of the applicable Test Period with
respect to leverage ratios or the first day of such Test Period with respect to the Fixed Charge Coverage Ratio.
(e)
Notwithstanding anything in this Agreement or any Loan Document to the contrary
(i)
the Borrower may rely on more than one basket or exception hereunder (including both ratio-based and non-
ratio based baskets and exceptions, and including partial reliance on different baskets that, collectively, permit the entire proposed
transaction) at the time of any proposed transaction, and the Borrower may, in its sole discretion, at any later time divide, classify
or reclassify such transaction (or any portion thereof) in any manner that complies with the available baskets and exceptions
hereunder at such later time; provided that with respect to reclassification of Indebtedness and Liens, any such reclassification
shall be subject to the parameters of Sections 7.01 and 7.03, as applicable; provided further no reclassification shall be permitted
to any basket that is based on Payment Conditions.
(ii)
unless the Borrower elects otherwise, if the Borrower or its Restricted Subsidiaries in connection with any
transaction or series of such related transaction (A) incurs Indebtedness, creates Liens, makes Dispositions, makes Investments,
designates any Subsidiary as restricted or unrestricted or repays any Indebtedness or takes any other action under or as permitted
by a ratio-based basket and (B) incurs Indebtedness, creates Liens, makes Dispositions, makes Investments, designates any
Subsidiary as restricted or unrestricted or repays any Indebtedness or takes any other action under a non-ratio-based basket (which
shall occur within five Business Days of the events in clause (A) above), then the applicable ratio will be calculated with respect to
any such action under the applicable ratio-based basket without regard to any such action under such non-ratio-based basket made
in connection with such transaction or series of related transactions;
(iii)
if the Borrower or its Restricted Subsidiaries enters into any revolving, delayed draw or other committed
debt facility, the Borrower may elect to determine compliance of such debt facility (including the incurrence of Indebtedness and
Liens from time to time in connection therewith) with this Agreement and each other Loan Document on the date commitments
with respect thereto are first received, assuming the full amount of such facility is incurred (and any applicable Liens are granted)
on such date, in which case such committed amount may thereafter be borrowed or reborrowed, in whole or in part, from time to
time, without further compliance with the Loan Documents, in lieu of determining such compliance on any subsequent date
(including any date on which Indebtedness is incurred pursuant to such facility); provided that, in each case, any future calculation
of any ratio based basket shall assume such facility is fully drawn until such commitments are terminated; and
(iv)
if the Borrower or any Restricted Subsidiary incurs Indebtedness under a ratio-based basket, such ratio-
based basket (together with any other ratio-based basket utilized in connection therewith, including in respect of other
Indebtedness, Liens, Dispositions, Investments, Restricted Payments or payments in respect of Junior Financing) will be
calculated excluding the cash proceeds of such Indebtedness for netting purposes (i.e., such cash proceeds shall not reduce the
Borrower’s Consolidated Net Debt or Consolidated Secured Net Debt pursuant to clause (b) of the definition of such terms),
provided that the actual application of such proceeds may reduce Indebtedness for purposes of determining compliance with any
applicable ratio.
(f)
Notwithstanding anything in this Agreement or any Loan Document to the contrary, when,
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(i)
calculating any applicable basket, ratio or financial metric in connection with the incurrence of Indebtedness,
the creation of Liens, the making of any Disposition, the making of an Investment, the making of a Restricted Payment, the
designation of a Subsidiary as restricted or unrestricted, the repayment of Indebtedness or for any other purpose;
(ii)
(iii)
action; or
determining the accuracy of any representation or warranty;
determining whether any Default or Event of Default has occurred, is continuing or would result from any
(iv)
determining compliance with any other condition precedent to any action or transaction;
in each case of clauses (i) through (iv) in connection with a Limited Condition Acquisition, the date of determination of such basket, ratio,
financial metric, the accuracy of such representation or warranty (but taking into account any earlier date specified therein), whether any
Default or Event of Default has occurred, is continuing or would result therefrom, or the satisfaction of any other condition precedent shall, at
the option of the Borrower (the Borrower’s election to exercise such option in connection with any Limited Condition Acquisition, an “LCA
Election”), be deemed to be the date the definitive agreements for such Limited Condition Acquisition are entered into (the “LCA Test
Date”). If on a Pro Forma Basis after giving effect to such Limited Condition Acquisition and the other transactions to be entered into in
connection therewith (including any incurrence of Indebtedness and the use of proceeds thereof) such baskets, ratios, financial metrics,
representations and warranties, absence of defaults, satisfaction of conditions precedent and other provisions are calculated as if such Limited
Condition Acquisition or other transactions had occurred at the beginning of the most recent Test Period ending prior to the LCA Test Date
for which financial statements are available, the Borrower could have taken such action on the relevant LCA Test Date in compliance with
the applicable baskets, ratios, financial metrics or other provisions, such provisions shall be deemed to have been complied with, unless a
Specified Event of Default is continuing on the date on which such Limited Condition Acquisition is consummated. For the avoidance of
doubt, (i) if any of such baskets, ratios, financial metrics, representations and warranties, absence of defaults, satisfaction of conditions
precedent or other provisions are exceeded or breached as a result of fluctuations in such basket, ratio or financial metrics (including due to
fluctuations in Consolidated Adjusted EBITDA), a change in facts and circumstances or other provisions at or prior to the consummation of
the relevant Limited Condition Acquisition, such baskets, ratios, financial metrics, representations and warranties, absence of defaults,
satisfaction of conditions precedent and other provisions will not be deemed to have been exceeded, breached, or otherwise failed as a result
of such fluctuations or changed circumstances solely for purposes of determining whether the Limited Condition Acquisition and any related
transactions is permitted hereunder and (ii) such baskets, ratios, financial metrics and compliance with such conditions shall not be tested at
the time of consummation of such Limited Condition Acquisition or related Specified Transactions. If the Borrower has made an LCA
Election for any Limited Condition Acquisition, then in connection with any subsequent calculation of any ratio, financial metric or basket
availability with respect to any other Specified Transaction or otherwise on or following the relevant LCA Test Date and prior to the earlier
of the date on which such Limited Condition Acquisition is consummated or the date that the definitive agreement for such Limited
Condition Acquisition is terminated or expires without consummation of such Limited Condition Acquisition, any such ratio, financial metric
or basket shall be calculated on a Pro Forma Basis assuming such Limited Condition Acquisition and other transactions in connection
therewith (including any incurrence of Indebtedness and the use of proceeds thereof) have been consummated. For purposes of any
calculation pursuant to this clause ((f)) of the Fixed Charge Coverage Ratio, Consolidated Interest Expense may be calculated using an
assumed interest rate for the Indebtedness to be incurred in connection with such Limited Condition Acquisition based on the indicative
interest margin contained in any financing commitment documentation with respect to such Indebtedness or, if no
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such indicative interest margin exists, as reasonably determined by the Borrower in good faith. Notwithstanding the forgoing, (i) in
connection with any transaction permitted hereunder that requires satisfaction of the Payment Conditions, the Borrower will be required to
comply as of the date of such transaction with the Excess Availability requirements (but not, for the avoidance of doubt, clause (i) of the
definition of “Payment Conditions” or any requirements relating to the Fixed Charge Coverage Ratio that are satisfied on the LCA Test Date
to the extent the Borrower shall have made an LCA Election in connection with such transaction) set forth in the definition of “Payment
Conditions”, regardless of whether the Borrower shall have made an LCA Election in connection with such transaction and (ii) in connection
with any Credit Extension, the Total Utilization of Revolving Commitments shall not exceed the Line Cap on the date of such Credit
Extension (other than as provided under Section 2.02).
(g)
[Reserved].
(h)
For purposes of determining the maturity date and/or Weighted Average Life of any Indebtedness, bridge loans or
Indebtedness funded into escrow that are subject to customary conditions (as determined by the Borrower in good faith, including conditions
requiring no payment or bankruptcy event of default) that would (x) in the case of bridge loans, either automatically be extended as,
converted into or required to be exchanged for permanent refinancing or (y) in the case of Indebtedness funded into escrow, that would be
mandatorily repaid or redeemed if the conditions to release from escrow are not met, in each case, shall be deemed to have the maturity date
and/or Weighted Average Life, as applicable, as so extended, converted or exchanged.
Section 1.09
Currency Equivalents Generally
.
(a)
No Default or Event of Default shall be deemed to have occurred under a Loan Document solely as a result of changes
in rates of currency exchange occurring after the time any applicable action (including any incurrence of a Lien or Indebtedness or the
making of an Investment) so long as such action (including any incurrence of a Lien or Indebtedness or the making of an Investment) was
permitted hereunder when made.
(b)
For purposes of this Agreement and the other Loan Documents, where the permissibility of a transaction or
determinations of required actions or circumstances depend upon compliance with, or are determined by reference to, amounts stated in
Dollars, any requisite currency translation (i) with respect to Loans or Commitments, shall be based on the Exchange Rate and (ii) with
respect to any other amounts, shall be based on the rate of exchange between the applicable currency and Dollars as reasonably determined
by the Borrower, in each case in effect on the Business Day immediately preceding the date of such transaction or determination (subject to
clauses (c) and (d) below) and shall not be affected by subsequent fluctuations in exchange rates; provided, that the determination of any
Dollar Amount shall be made in accordance with Section 2.23.
(c)
For purposes of determining compliance with any Dollar-denominated restriction on the incurrence of Indebtedness, the
Dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be calculated based on the Exchange Rate in
effect on the date such Indebtedness was incurred, in the case of term debt, or first committed, in the case of revolving credit debt (or, in the
case of an LCA Election, on the date of the applicable LCA Test Date); provided that, if such Indebtedness is incurred to refinance other
Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable Dollar-denominated restriction to be
exceeded if calculated at the Exchange Rate in effect on the date of such refinancing, such Dollar-denominated restriction shall be deemed
not to have been exceeded so long as the principal amount of such Indebtedness so refinanced does not exceed the principal amount of such
Indebtedness being refinanced; provided, further that the determination of any Dollar Amount shall be made in accordance with Section
2.23. Notwithstanding the foregoing, the principal
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amount of any Indebtedness incurred to refinance other Indebtedness, if incurred in a different currency from the Indebtedness being
refinanced, shall be calculated based on the Exchange Rate that is in effect on the date of such refinancing.
(d)
For purposes of determining the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio, the Total Net
Leverage Ratio and the Fixed Charge Coverage Ratio, including Consolidated Adjusted EBITDA when calculating such ratios, all amounts
denominated in a currency other than Dollars will be converted to Dollars for any purpose (including testing the any financial maintenance
covenant) at the effective rate of exchange in respect thereof reflected in the consolidated financial statements of the Borrower for the
applicable Test Period for which such measurement is being made, and will reflect the currency translation effects, determined in accordance
with GAAP, of Hedge Agreements permitted hereunder for currency exchange risks with respect to the applicable currency in effect on the
date of determination of the Dollar equivalent of such Indebtedness.
(e)
All references in the Loan Documents to Loans, Letters of Credit, Obligations, Borrowing Base components and other
amounts shall be denominated in Dollars, unless expressly provided otherwise. The Dollar Amount of any amounts denominated or reported
under a Loan Document in a currency other than Dollars shall be determined by the Administrative Agent on a daily basis based on the
current Exchange Rate. The Borrower shall report Borrowing Base components to the Administrative Agent in the currency invoiced by the
Loan Parties or shown in the Loan Parties’ financial records, and unless expressly provided otherwise, the Borrower shall deliver financial
statements and calculate financial covenants in Dollars. Notwithstanding anything herein to the contrary, if any Obligation is funded and
expressly denominated in a currency other than Dollars, the Borrower shall repay such Obligation in such other currency.
Section 1.10
Co-Borrowers
. Notwithstanding anything herein to the contrary, the Borrower, upon 15 Business Days’ prior written notice to the
Administrative Agent (or such shorter period as reasonably agreed by the Administrative Agent), may cause any Loan Party on or after the
Closing Date by written election to the Administrative Agent to become a borrower (each such Loan Party, a “Co-Borrower”, and, together
with the Borrower, the “Co-Borrowers”) under each of the Facilities hereunder on a joint and several basis (such date, the “Co-Borrower
Effective Date”); provided that such Loan Party shall (i) execute a joinder to this Agreement in form and substance reasonably satisfactory to
the Administrative Agent assuming all obligations of a Co-Borrower hereunder, (ii) at least three Business Days prior to such Co-Borrower
Effective Date, provide to the Administrative Agent and the Lenders all documentation and other information required by United States
regulatory authorities under applicable “know your customer” and anti-money laundering Laws, including without limitation Title III of the
USA Patriot Act, that shall be reasonably requested by the Administrative Agent in writing at least 10 Business Days prior to the
consummation of such joinder and (iii) provide to the Administrative Agent and the Lenders, if such Loan Party qualifies as a “legal entity
customer” under the Beneficial Ownership Regulation, a Beneficial Ownership Certification and (iv) be a domestic Subsidiary Guarantor that
is a Domestic Subsidiary or a Canadian Subsidiary wholly owned by the Borrower. The Lenders hereby irrevocably authorize the
Administrative Agent to enter into any amendment to this Agreement or to any other Loan Document as may be necessary or appropriate in
order to establish any additional Borrower pursuant to this Section 1.10 and such technical amendments, and other customary amendments
with respect to provisions of this Agreement relating to taxes for borrowers, in each case as may be necessary or appropriate in the reasonable
opinion of the Administrative Agent and the Borrower in connection therewith. Domtar Inc., a subsidiary organized under the laws of
Canada, shall be deemed to be a Co-Borrower as of the Closing Date without the need to execute a joinder as provided this Section 1.10.
Upon the later of execution and delivery of a joinder to this Agreement by a Co-Borrower and the countersignature of the
Administrative Agent thereto, each Co-Borrower agrees that it is jointly and
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severally liable for the obligations of each other Co-Borrower hereunder with respect to any Class of Loans on an individual tranche basis,
including with respect to the payment of principal of and interest on all Loans on an individual tranche basis, the payment of amounts owing
in respect of Letters of Credit and the payment of fees and indemnities and reimbursement of costs and expenses. Each Co-Borrower is
accepting joint and several liability hereunder in consideration of the financial accommodations to be provided by the Administrative Agent,
the Collateral Agent and the Lenders under this Agreement, for the mutual benefit, directly and indirectly, of each of the Co-Borrowers and
in consideration of the undertakings of each of the Co-Borrowers to accept joint and several liability for the obligations of each of
them. Each Co-Borrower, jointly and severally, hereby irrevocably and unconditionally accepts, as a co-debtor, joint and several liability
with each other Co-Borrower, with respect to the payment and performance of all of the Obligations, it being the intention of the parties
hereto that all Obligations shall be the joint and several obligations of all of the Co-Borrowers without preferences or distinction among
them. If and to the extent that any of the Co-Borrowers shall fail to make any payment with respect to any of the Obligations as and when
due or to perform any of such Obligations in accordance with the terms thereof, then in each such event each other Borrower will make such
payment with respect to, or perform, such Obligations. Each Co-Borrower further agrees that the Borrower will be such Co-Borrower’s
agent for administrative, mechanical, and notice provisions in this Agreement and any other Loan Document and the Lenders and the
Administrative Agent hereby agree that each Co-Borrower will have the same rights under the Loan Documents as if it is the Borrower and
for any other purposes under the provisions of this Agreement, including the affirmative and negative covenants, each such Co-Borrower will
be treated as a Restricted Subsidiary that is a Subsidiary Guarantor.
ARTICLE II.
THE COMMITMENTS AND BORROWINGS
Section 2.01
Revolving Loans
.
(a)
Revolving Loan Commitment. During the Revolving Commitment Period, subject to the terms and conditions hereof,
(i) each Tranche 1 Revolving Lender severally agrees to make revolving loans to the Borrower or any Co-Borrower from time to time on any
Business Day in Dollars and/or any Alternative Currency (“Tranche 1 Revolving Loans”) in an aggregate amount (expressed in the Dollar
Amount thereof in the case of an Alternative Currency) up to but not exceeding such Tranche 1 Revolving Lender’s Tranche 1 Revolving
Commitment and (ii) each Tranche 2 Revolving Lender severally agrees to make revolving loans to the Borrower or any Co-Borrower from
time to time on any Business Day in Dollars (“Tranche 2 Revolving Loans”) in an aggregate amount up to but not exceeding such Tranche 2
Revolving Lender’s Tranche 2 Revolving Commitment; provided, that after giving effect to the making of any Revolving Loans in no event
shall the Total Utilization of Revolving Commitments exceed the Line Cap. Within the foregoing limits and subject to the terms and
conditions set forth herein (including the Administrative Agent’s authority, in its sole discretion, to make Protective Advances pursuant to the
terms of Section 2.02), amounts borrowed pursuant to this Section 2.01(a) may be repaid and reborrowed during the Revolving Commitment
Period. Each Revolving Lender’s Revolving Commitment shall expire on the Revolving Commitment Termination Date, and all Revolving
Loans and all other amounts owed hereunder with respect to the Revolving Loans and the Revolving Commitments shall be paid in full no
later than such date.
(b)
Borrowing Mechanics for Revolving Loans.
(i)
Subject to Section 4.01(a)(i) in the case of Borrowings of Revolving Loans on the Closing Date only and
Section 4.02(c) in the case of each other Borrowing of Revolving Loans, each Borrowing of Revolving Loans shall be made upon
the Borrower’s notice to the Administrative Agent, which may only be given in writing (each request for a Swing Line Loan
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Borrowing shall be made in accordance with Section 2.03). Each such notice must be received by the Administrative Agent not
later than (A) 1:00 p.m. (or such later time as may be agreed by the Administrative Agent in its reasonable discretion) three
Business Days prior to the requested date of any Borrowing of Eurocurrency Rate Loans, (B) 11:00 a.m. (or such later time as may
be agreed by the Administrative Agent in its reasonable discretion) on the requested date of any Borrowing of Base Rate Loans
and (C) 1:00 p.m. (or such later time as may be agreed by the Administrative Agent in its reasonable discretion) on the Business
Day prior to the Closing Date for Borrowings on the Closing Date; provided, that such notices may be conditioned on the
occurrence of the Closing Date or the occurrence of any transaction anticipated to occur in connection with the proceeds of such
Borrowing; provided, however, that if the Borrower wishes to request Eurocurrency Rate Loans denominated in Dollars having an
Interest Period other than one, two, three or six months in duration as provided in the definition of “Interest Period,” the applicable
notice must be received by the Administrative Agent not later than 11:00 a.m. four Business Days prior to the requested date of
such Borrowing (or such shorter period as reasonably agreed by the Administrative Agent), conversion or continuation,
whereupon the Administrative Agent shall give prompt notice to the applicable Lenders of such request and determine whether the
requested Interest Period is acceptable to all of them and not later than 11:00 a.m., three Business Days before the requested date
of such Borrowing, conversion or continuation, the Administrative Agent shall notify the Borrower (which notice may be by
telephone) whether or not the requested Interest Period has been consented to by all the Lenders. Each notice by the Borrower
pursuant to this Section 2.01(b) must be delivered to the Administrative Agent in the form of a Committed Loan Notice,
appropriately completed and signed by a Responsible Officer of the Borrower. Each Borrowing of Eurocurrency Rate Loans shall
be in a principal amount of (A) $500,000 or a whole multiple of $100,000 in excess thereof in the case of Eurocurrency Rate
Loans denominated in Dollars, (B) C$500,000 or a whole multiple of C$100,000 in excess thereof in the case of Eurocurrency
Rate Loans denominated in Canadian Dollars and (C) a Dollar Amount of $500,000 or a whole multiple of $100,000 in excess
thereof in the case of Eurocurrency Rate Loans denominated in any Alternative Currency other than Canadian Dollars. Each
Borrowing of Base Rate Loans shall be in a principal amount (A) $500,000 or a whole multiple of $100,000 in excess thereof in
the case of Eurocurrency Rate Loans denominated in Dollars and (B) C$500,000 or a whole multiple of C$100,000 in excess
thereof in the case of Eurocurrency Rate Loans denominated in Canadian Dollars. Each Committed Loan Notice shall specify (A)
that the Borrower is requesting a Revolving Loan Borrowing, (B) the requested date of the Borrowing (which shall be a Business
Day), (C) the principal amount of Revolving Loans to be borrowed, (D) the Type of Revolving Loans to be borrowed, (E) with
respect to any Eurocurrency Rate Loan, the currency of the Revolving Loan, which shall be Dollars or an Alternative Currency;
provided that the Borrower shall deliver to the Administrative Agent any request for designation of an Alternative Currency other
than Canadian Dollars and Euros in accordance with Section 11.02, to be received by the Administrative Agent no later than 11:00
a.m. (New York City time) at least 15 Business Days in advance of the date of any Borrowing hereunder proposed to be made in
such Alternative Currency (or such other time or date as may be agreed by the Administrative Agent and, in the case of any such
request pertaining to Letters of Credit, the applicable Issuing Bank(s), in its or their sole discretion), (F) if applicable, the duration
of the Interest Period with respect thereto, (G) whether such Revolving Loans should be funded to the Borrower or to any
applicable Co-Borrower (and if so, the applicable Co-Borrower shall be specified) and (H) whether such Revolving Loan
Borrowing shall be borrowed pursuant to the Tranche 1 Revolving Commitments or the Tranche 2 Revolving Commitments. Each
Swing Line Loan shall be a Base Rate Loan. If the Borrower fails to specify a Type of Revolving Loan in a Committed Loan
Notice, then (x) in the case of Revolving Loans denominated in Dollars or Canadian Dollars, the applicable Revolving Loans shall
be made as Base Rate Loans and (y) in the case of Tranche 1 Revolving Loans denominated in an Alternative Currency (other than
Canadian Dollars), the applicable Tranche 1 Revolving Loans shall be made
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as Eurocurrency Rate Loans with an Interest Period of one month. If the Borrower requests a Borrowing of Eurocurrency Rate
Loans in any such Committed Loan Notice, but fails to specify an Interest Period for such Eurocurrency Rate Loans, the Borrower
will be deemed to have specified an Interest Period of one month.
(ii)
Borrowings of more than one Type may be outstanding at the same time: provided that the total number of
Interest Periods for Eurocurrency Rate Loans outstanding under this Agreement at any time shall comply with Section 2.10(g).
(iii)
Following receipt of a Committed Loan Notice, the Administrative Agent shall promptly notify each Lender
of the amount of its Pro Rata Share of the applicable Revolving Loans. In the case of each Borrowing, each Appropriate Lender
shall make the amount of its Revolving Loan available to the Administrative Agent in Same Day Funds at the Administrative
Agent’s Office not later than 1:00 p.m., on the Business Day specified in the applicable Committed Loan Notice. Each Lender
may, in its discretion, arrange for its Revolving Loans to be issued by Affiliates or branches of such Lender (or other financial
institution). Upon satisfaction of the applicable conditions set forth in Section 4.02 (or if such Borrowing is on the Closing Date,
Section 4.01), the Administrative Agent shall make all funds so received available to the Borrower or such Co-Borrower in like
funds as received by the Administrative Agent either by (A) crediting the account of the Borrower or such Co-Borrower on the
books of the Administrative Agent with the amount of such funds or (B) wire transfer of such funds, in each case in accordance
with instructions provided to (and reasonably acceptable to) the Administrative Agent by the Borrower; provided, however, that if,
on the date the Committed Loan Notice with respect to such Borrowing is given by the Borrower, there are Swing Line Loans
outstanding or Reimbursement Obligations outstanding, then the proceeds of such Borrowing shall be applied, first, to the
payment in full of any such Reimbursement Obligations, second, to the payment in full of any such Swing Line Loans and third,
to the Borrower or Co-Borrower, as applicable, as provided above.
(iv)
The failure of any Lender to make the Revolving Loan to be made by it as part of any Borrowing shall not
relieve any other Lender of its obligation, if any, hereunder to make its Revolving Loan on the date of such Borrowing, but no
Lender shall be responsible for the failure of any other Lender to make the Revolving Loan to be made by such other Lender on
the date of any Borrowing.
Section 2.02
Protective Advances
.
(a)
Subject to the limitations set forth below (and notwithstanding anything to the contrary in Section 4.02), the
Administrative Agent is authorized by the Borrower and the Lenders, from time to time in the Administrative Agent’s sole discretion in the
exercise of its commercially reasonable judgment (but shall not have any obligation) to make Revolving Loans denominated in Dollars to the
Borrower, on behalf of all Lenders at any time that any condition precedent set forth in Section 4.02 has not been satisfied or waived, which
the Administrative Agent, in its Permitted Discretion, deems necessary or desirable (i) to preserve or protect the Collateral, or any portion
thereof, (ii) to enhance the likelihood of, or maximize the amount of, repayment of the Revolving Loans and other Obligations or (iii) to pay
any other amount chargeable to or required to be paid by the Borrower pursuant to the terms of this Agreement, including payments of
reimbursable expenses (including costs, fees, and expenses as described in Section 11.04) and other sums, in each case to the extent due and
payable (and not in dispute by the Borrower (acting in good faith)) under the Loan Documents (each such Revolving Loan, a “Protective
Advance”). Any Protective Advance may be made in a principal amount that would cause the Total Utilization of Revolving Commitments
to exceed the Borrowing Base; provided that no Protective Advance may be made to the extent that, after giving effect to such Protective
Advance (together with the outstanding principal amount
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of any outstanding Protective Advances), the aggregate principal amount of Protective Advances outstanding hereunder would exceed 10.0%
of the Borrowing Base as determined on the date of such proposed Protective Advance; provided, further, that (i) the total Tranche 1
Revolving Exposure shall not exceed the aggregate amount of the Tranche 1 Revolving Commitments then in effect and (ii) the total Tranche
2 Revolving Exposure shall not exceed the aggregate amount of the Tranche 2 Revolving Commitments then in effect. Each Protective
Advance shall be secured by the Liens in favor of the Administrative Agent in and to the Collateral and shall constitute Obligations
hereunder. The Agent’s authorization to make Protective Advances may be revoked by the Required Lenders at any time. Any such
revocation must be in writing and shall become effective prospectively upon the Administrative Agent’s receipt thereof. The making of a
Protective Advance on any one occasion shall not obligate the Administrative Agent to make any Protective Advance on any other
occasion. At any time (and in any event no less than weekly) that the conditions precedent set forth in Section 4.02 have been satisfied or
waived, the Administrative Agent may request the Lenders to make a Revolving Loan to repay a Protective Advance. At any other time, the
Administrative Agent may require the Lenders to fund their risk participations described in Section 2.04(b). Each Protective Advance shall
be a Base Rate Loan.
(b)
Upon the making of a Protective Advance by the Administrative Agent (whether before or after the occurrence of a
Default or Event of Default), each Lender shall be deemed, without further action by any party hereto, unconditionally and irrevocably to
have purchased from the Administrative Agent without recourse or warranty, an undivided interest and participation in such Protective
Advance in proportion to its Pro Rata Share. From and after the date, if any, on which any Lender is required to fund its participation in any
Protective Advance purchased hereunder, the Administrative Agent shall promptly distribute to such Lender, such Lender’s Pro Rata Share of
all payments of principal and interest and all proceeds of Collateral (if any) received by the Administrative Agent in respect of such
Protective Advance.
Section 2.03
Swing Line Loans
.
(a)
Swing Line Loan. Subject to the terms and conditions set forth herein, the Swing Line Lender, in reliance on the
agreements of the Tranche 1 Revolving Lenders set forth in this Section 2.03, agrees to make Swing Line Loans denominated in Dollars or
Canadian Dollars to the Borrower or any Co-Borrower from time to time on any Business Day during the Revolving Commitment Period, in
an aggregate principal amount not to exceed at any time outstanding the amount of the Swing Line Sublimit; provided that, after giving effect
to any Swing Line Loan, (i) the Total Utilization of Revolving Commitments shall not exceed the Line Cap, (ii) the Total Utilization of
Tranche 1 Revolving Commitments of any Tranche 1 Revolving Lender shall not exceed such Tranche 1 Revolving Lender’s Tranche 1
Revolving Commitment and (iii) the aggregate principal amount outstanding of all Swing Line Loans shall not exceed the Swing Line
Sublimit; provided, further, that the Swing Line Lender shall not be required to make a Swing Line Loan to refinance an outstanding Swing
Line Loan. Within the foregoing limits and subject to the terms and conditions set forth herein, the Borrower and Co-Borrowers may borrow,
prepay and reborrow Swing Line Loans. Immediately upon the making of a Swing Line Loan by the Swing Line Lender, each Tranche 1
Revolving Lender shall be deemed to, and hereby irrevocably and unconditionally agrees to, purchase from the Swing Line Lender a
participation in such Swing Line Loan in an amount equal to such Tranche 1 Revolving Lender’s Pro Rata Share of the amount of such
Swing Line Loan.
(b)
Borrowing Mechanics for Swing Line Loans. Each Swing Line Loan Borrowing shall be made upon the Borrower
irrevocable notice to the Swing Line Lender. Each such notice may be given by: (A) telephone, or (B) a Swing Line Loan Request; provided
that any telephonic notice by the Borrower must be confirmed immediately by delivery to the Swing Line Lender and the Administrative
Agent of a Swing Line Loan Request. Each such Swing Line Loan Request must be received by the Swing Line Lender and the
Administrative Agent not later than 12:00 noon (New York City time) on the date of the requested Swing Line Loan Borrowing, and such
notice shall specify (i) the amount to be borrowed, which
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shall be in a minimum principal amount of (A) with respect to Loans denominated in Dollars, $100,000 or a whole multiple of $25,000 in
excess thereof and (B) with respect to Loans denominated in Canadian Dollars, C$100,000 or a whole multiple of C$25,000 in excess
thereof, (ii) Swing Line Loans should be funded to the Borrower or to any applicable Co-Borrower (and if so, the applicable Co-Borrower
shall be specified) and (iii) the date of such Swing Line Loan Borrowing (which shall be a Business Day). Promptly after receipt by the
Swing Line Lender of such notice, the Swing Line Lender will confirm with the Administrative Agent that the Administrative Agent has also
received such notice and, if not, the Swing Line Lender will notify the Administrative Agent of the contents thereof. Unless the Swing Line
Lender has received notice from the Administrative Agent (including at the request of the Required Lenders) prior to 2:00 p.m. (New York
City time) on such requested borrowing date (A) directing the Swing Line Lender not to make such Swing Line Loan as a result of the
limitations set forth in the first sentence of Section 2.03(a) or (B) that one or more of the applicable conditions set forth in Section 4.02 is not
then satisfied, then, subject to the terms and conditions set forth herein, the Swing Line Lender shall make each Swing Line Loan available to
the Borrower or Co-Borrower, by wire transfer thereof in accordance with instructions provided to (and reasonably acceptable to) the Swing
Line Lender, not later than 3:00 p.m. (New York City time) on the requested date of such Swing Line Loan (which instructions may include
standing payment instructions, which may be updated from time to time by the Borrower, provided that, unless the Swing Line Lender shall
otherwise agree, any such update shall not take effect until the Business Day immediately following the date on which such update is
provided to the Swing Line Lender).
(c)
Refinancing of Swing Line Loans.
(i)
The Swing Line Lender at any time in its sole and absolute discretion may request (but in any event shall
request no less frequently than weekly), on behalf of the Borrower (which hereby irrevocably authorizes the Swing Line Lender to
so request on its behalf), that each Tranche 1 Revolving Lender make a Tranche 1 Revolving Loan that is a Base Rate Loan in an
amount equal to such Lender’s Pro Rata Share of the amount of Swing Line Loans made by then Swing Line Lender then
outstanding (the “Refunded Swing Line Loans”). Such request shall be made in writing (which written request shall be deemed
to be a Committed Loan Notice for purposes hereof) and in accordance (including with respect to prior notice requirements) with
the requirements of Section 2.03(b), without regard to the minimum and multiples specified therein, but subject to the aggregate
unused Tranche 1 Revolving Commitments and the conditions set forth in Section 4.02. The Swing Line Lender shall furnish the
Borrower with a copy of such Committed Loan Notice promptly after delivering such notice to the Administrative Agent. Each
Tranche 1 Revolving Lender shall make an amount equal to its Pro Rata Share of the amount specified in such Committed Loan
Notice available to the Administrative Agent in immediately available funds (and the Administrative Agent may apply Cash
Collateral available with respect to the applicable Swing Line Loan) for the account of the Swing Line Lender at the
Administrative Agent’s Office not later than 1:00 p.m. (New York City time) on the day specified in such Committed Loan Notice,
whereupon, subject to Section 2.03(c)(ii), each Tranche 1 Revolving Lender that so makes funds available shall be deemed to have
made a Tranche 1 Revolving Loan that is a Base Rate Loan to the Borrower or such Co-Borrower, as applicable, in such amount.
(ii)
If for any reason any Swing Line Loan cannot be refinanced by such a Tranche 1 Revolving Loan Borrowing
in accordance with Section 2.03(c)(i), the request for Tranche 1 Revolving Loans that are Base Rate Loans submitted by the Swing
Line Lender as set forth herein shall be deemed to be a request by the Swing Line Lender that each of the Tranche 1 Revolving
Lenders fund its participation in the relevant Swing Line Loan and each Tranche 1 Revolving Lender’s payment to the
Administrative Agent for the account of the Swing Line Lender pursuant to Section 2.03(c)(i) shall be deemed payment in respect
of such participation. The Administrative Agent shall notify the Borrower on the last Business Day of such week of any
participations in any
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Swing Line Loan funded during such week pursuant to this clause (ii), and thereafter payments in respect of such Swing Line
Loan (to the extent of such funded participations) shall be made to the Administrative Agent for the benefit of the Lenders and not
to the Swing Line Lender.
(iii)
If any Tranche 1 Revolving Lender fails to make available to the Administrative Agent for the account of
the Swing Line Lender any amount required to be paid by such Tranche 1 Revolving Lender pursuant to the foregoing provisions
of this Section 2.03(c) by the time specified in Section 2.03(c)(i), the Swing Line Lender (acting through the Administrative
Agent) shall be entitled to recover from such Tranche 1 Revolving Lender, on demand, such amount with interest thereon for the
period from the date such payment is required to the date on which such payment is immediately available to such Swing Line
Lender at a rate per annum equal to the greater of the Federal Funds Rate from time to time in effect and a rate determined by the
Swing Line Lender in accordance with banking industry rules on interbank compensation, plus any reasonable administrative,
processing or similar fees customarily charged by the Swing Line Lender in connection with the foregoing. If such Tranche 1
Revolving Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Tranche 1
Revolving Lender’s Tranche 1 Revolving Loan included in the relevant Tranche 1 Revolving Loan Borrowing or funded
participation in the relevant Swing Line Loan, as the case may be. A certificate of the Swing Line Lender submitted (through the
Administrative Agent) to any Tranche 1 Revolving Lender with respect to any amounts owing under this clause (iii) shall be
conclusive absent manifest error.
(iv)
Each Tranche 1 Revolving Lender’s obligation to make Tranche 1 Revolving Loans or to purchase and fund
participations in Swing Line Loans pursuant to this Section 2.03(c) shall be absolute and unconditional and shall not be affected
by any circumstance, including (A) any setoff, counterclaim, recoupment, defense or other right which such Lender may have
against the Swing Line Lender, the Borrower, such Co-Borrower or any other Person for any reason whatsoever, (B) the
occurrence or continuance of a Default or (C) any other occurrence, event or condition, whether or not similar to any of the
foregoing; provided that each Tranche 1 Revolving Lender’s obligation to make Tranche 1 Revolving Loans pursuant to this
Section 2.03(c) is subject to the conditions set forth in Section 4.02; provided, further, that for the avoidance of doubt, the
conditions set forth in Section 4.02 shall not apply to the purchase or funding of participations pursuant to this Section
2.03(c). No such funding of participations shall relieve or otherwise impair the obligation of the Borrower or such Co-Borrower,
as applicable, to repay Swing Line Loans, together with interest as provided herein.
(d)
Repayment of Participations.
(i)
At any time after any Tranche 1 Revolving Lender has purchased and funded a participation in a Swing Line
Loan, if the Swing Line Lender receives any payment on account of such Swing Line Loan, the Swing Line Lender will promptly
remit such Tranche 1 Revolving Lender’s Pro Rata Share of such payment to the Administrative Agent (appropriately adjusted, in
the case of interest payments, to reflect the period of time during which such Tranche 1 Revolving Lender’s participation was
funded) in like funds as received by the Swing Line Lender, and any such amounts received by the Administrative Agent will be
remitted by the Administrative Agent to the Tranche 1 Revolving Lenders that shall have funded their participations pursuant to
Section 2.03(c)(ii) to the extent of their interests therein.
(ii)
If any payment received by the Swing Line Lender in respect of principal or interest on any Swing Line Loan
is required to be returned by the Swing Line Lender under any of the circumstances described in Section 11.06 (including pursuant
to any settlement entered into by
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the Swing Line Lender in its reasonable discretion), each Tranche 1 Revolving Lender shall pay to such Swing Line Lender its Pro
Rata Share thereof on demand of the Administrative Agent, plus interest thereon from the date of such demand to the date such
amount is returned at a rate per annum equal to the Federal Funds Rate from time to time in effect. The Administrative Agent will
make such demand upon the request of the Swing Line Lender. The obligations of the Tranche 1 Revolving Lenders under this
clause (ii) shall survive the payment in full of the Obligations and the termination of this Agreement.
(e)
Interest for Account of Swing Line Lender. The Swing Line Lender shall be responsible for invoicing the Borrower for
interest on the Swing Line Loans made by the Swing Line Lender. Until each Tranche 1 Revolving Lender funds its Tranche 1 Revolving
Loan that is a Base Rate Loan or participation pursuant to this Section 2.03 to refinance such Lender’s Pro Rata Share of any Swing Line
Loan made by the Swing Line Lender, interest in respect of such Lender’s share thereof shall be solely for the account of the Swing Line
Lender.
(f)
Payments Directly to Swing Line Lender. Except as otherwise expressly provided herein, the Borrower shall make all
payments of principal and interest in respect of the Swing Line Loans directly to the Swing Line Lender.
Section 2.04
Issuance of Letters of Credit and Purchase of Participations Therein
.
(a)
Letter of Credit Commitment.
(i)
Subject to the terms and conditions set forth herein, (A) each Issuing Bank agrees, in reliance upon the
agreements of the Tranche 1 Revolving Lenders set forth in this Section 2.04, (1) from time to time on any Business Day during
the Revolving Commitment Period on or prior to the fifth Business Day prior to the Revolving Commitment Termination Date, to
issue Letters of Credit for the account of the Borrower, any Co-Borrower or a Restricted Subsidiary (provided that any Letter of
Credit issued for the benefit of any Restricted Subsidiary (other than a Co-Borrower) shall be issued for the account of the
Borrower but such Letter of Credit shall indicate that it is being issued for the benefit of such Restricted Subsidiary; provided that,
Wells Fargo Bank, National Association shall not be obligated to issue Letters of Credit to any Co-Borrower that is a Canadian
Subsidiary) and to amend, renew or extend Letters of Credit previously issued by it, in accordance with Section 2.04(b) and (2) to
honor drawings under the Letters of Credit; and (B) the Tranche 1 Revolving Lenders severally agree to participate in such Letters
of Credit and any drawings thereunder; provided that the Issuing Banks shall not be obligated to make any Letter of Credit
Extension if, as of the date of such Letter of Credit Extension, (1) the Total Utilization of Tranche 1 Revolving Commitments
would exceed the Line Cap, (2) the Total Utilization of Tranche 1 Revolving Commitments of any Tranche 1 Revolving Lender,
would exceed such Lender’s Tranche 1 Revolving Commitment, (3) the Letter of Credit Usage would exceed the Letter of Credit
Sublimit or (4) the Letter of Credit Usage with respect to Letters of Credit issued by such Issuing Bank would exceed the amount
of such Issuing Bank’s Letter of Credit Percentage of the Letter of Credit Sublimit. Within the foregoing limits, and subject to the
terms and conditions hereof, the Borrower’s and the Co-Borrowers’ ability to obtain Letters of Credit shall be fully revolving, and
accordingly the Borrower and the Co-Borrowers may, during the foregoing period, obtain Letters of Credit to replace Letters of
Credit that have expired or that have been drawn upon and reimbursed. All Existing Letters of Credit shall be deemed to have
been issued pursuant hereto, and from and after the Closing Date shall be subject to and governed by the terms and conditions
hereof.
(ii)
An Issuing Bank shall not be under any obligation to issue any Letter of Credit if:
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(A)
any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms
purport to enjoin or restrain such Issuing Bank from issuing such Letter of Credit, or any Law applicable to such
Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority
with jurisdiction over such Issuing Bank shall prohibit, or request that such Issuing Bank refrain from, the issuance of
letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuing Bank with respect to
such Letter of Credit any restriction, reserve or capital requirement (for which such Issuing Bank is not otherwise
compensated hereunder) not in effect on the Closing Date, or shall impose upon such Issuing Bank any unreimbursed
loss, cost or expense which was not applicable on the Closing Date and which such Issuing Bank in good faith deems
material to it (for which such Issuing Bank is not otherwise compensated hereunder);
(B)
the issuance of such Letter of Credit would violate one or more policies of such Issuing Bank
applicable to letters of credit generally;
(C)
except as otherwise agreed by the Administrative Agent and such Issuing Bank, such Letter of
Credit is in an initial stated amount less than $10,000;
(D)
such Letter of Credit is to be denominated in a currency other than Dollars, Canadian Dollars or, if
agreed by such Issuing Bank, an Alternative Currency;
(E)
such Letter of Credit contains any provisions for automatic reinstatement of the stated amount
after any drawing thereunder; and
(F)
any Tranche 1 Revolving Lender is at such time a Defaulting Lender, unless such Issuing Bank has
entered into arrangements, including reallocation of such Lender’s Pro Rata Share of the outstanding Letter of Credit
Obligations pursuant to Section 2.19(a)(iii) or the delivery of Cash Collateral, satisfactory to such Issuing Bank (in its
sole discretion) with the Borrower or such Lender to eliminate such Issuing Bank’s actual or potential Fronting
Exposure (after giving effect to Section 2.19(a)(iii)) with respect to such Lender arising from either the Letter of Credit
then proposed to be issued or such Letter of Credit and all other Letter of Credit Obligations as to which such Issuing
Bank has actual or potential Fronting Exposure, as it may elect in its sole discretion.
(iii)
No Issuing Bank shall be under any obligation to amend or extend any Letter of Credit if (A) such Issuing
Bank would have no obligation at such time to issue the Letter of Credit in its amended form under the terms hereof or (B) the
beneficiary of such Letter of Credit does not accept the proposed amendment thereto.
(iv)
Unless Cash Collateralized or backstopped pursuant to arrangements reasonably acceptable to the applicable
Issuing Bank, each standby Letter of Credit shall expire at or prior to the close of business on the earlier of (A) the date twelve
months after the date of issuance of such Letter of Credit (or, in the case of any Auto-Renewal Letter of Credit, twelve months
after the then current expiration date of such Letter of Credit) and (B) the Letter of Credit Expiration Date (unless arrangements
reasonably satisfactory to the Issuing Banks have been entered into).
Procedures for Issuance and Amendment of Letters of Credit; Auto Renewal Letters of Credit
(b)
.
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(i)
Each Letter of Credit shall be issued or amended, as the case may be, upon the irrevocable request of the
Borrower delivered to the applicable Issuing Bank (with a copy to the Administrative Agent) in the form of a Letter of Credit
Application, appropriately completed and signed by a Responsible Officer of the Borrower. Such Letter of Credit Application
must be received by the applicable Issuing Bank and the Administrative Agent not later than 2:00 p.m. (New York City time) at
least five Business Days (or such shorter period as the applicable Issuing Bank and the Administrative Agent may agree in a
particular instance in their sole discretion) prior to the proposed issuance date or date of amendment, as the case may be. In the
case of a request for an initial issuance of a Letter of Credit, such Letter of Credit Application shall specify in form and detail
reasonably satisfactory to the applicable Issuing Bank (A) the proposed issuance date of the requested Letter of Credit (which shall
be a Business Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and address of the beneficiary thereof;
(E) the documents to be presented by such beneficiary in case of any drawing thereunder; (F) the full text of any certificate to be
presented by such beneficiary in case of any drawing thereunder; and (G) the currency in which the requested Letter of Credit will
be denominated (which must be Dollars, Canadian Dollars or, if approved by such Issuing Bank, an Alternative Currency other
than Canadian Dollars), whether such Letter of Credit is being issued for the account of the Borrower or a Co-Borrower, and the
applicable person shall be specified and (I) such other matters as the applicable Issuing Bank may reasonably request. In the case
of a request for an amendment of any outstanding Letter of Credit, the Letter of Credit Application shall specify in form and detail
reasonably satisfactory to the applicable Issuing Bank (1) the Letter of Credit to be amended; (2) the proposed date of amendment
thereof (which shall be a Business Day); and (3) the nature of the proposed amendment. Additionally, the Borrower shall furnish
to the applicable Issuing Bank and the Administrative Agent such other documents and information pertaining to such requested
Letter of Credit issuance or amendment, including any Letter of Credit Documents, as the applicable Issuing Bank or the
Administrative Agent may reasonably require.
(ii)
Promptly after receipt of any Letter of Credit Application, the applicable Issuing Bank will confirm with the
Administrative Agent that the Administrative Agent has received a copy of such Letter of Credit Application from the Borrower
and, if not, the applicable Issuing Bank will provide the Administrative Agent with a copy thereof. Upon receipt by the applicable
Issuing Bank of confirmation from the Administrative Agent that the requested issuance or amendment is permitted in accordance
with the terms hereof, then, subject to the terms and conditions set forth herein, such Issuing Bank shall, on the requested date,
issue a Letter of Credit for the account of the Borrower or a Co-Borrower or enter into the applicable amendment, as the case may
be. Immediately upon the issuance of each Letter of Credit, each Tranche 1 Revolving Lender shall be deemed to, and hereby
irrevocably and unconditionally agrees to, purchase from the applicable Issuing Bank a participation in such Letter of Credit in an
amount equal to such Lender’s Pro Rata Share of the amount of such Letter of Credit.
(iii)
If the Borrower so requests in any applicable Letter of Credit Application for a standby Letter of Credit, the
applicable Issuing Bank may, in its reasonable discretion, agree to issue a standby Letter of Credit that has automatic renewal
provisions (each, an “Auto-Renewal Letter of Credit”); provided that any such Auto-Renewal Letter of Credit shall permit such
Issuing Bank to prevent any such renewal at least once in each twelve-month period (commencing with the date of issuance of
such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day (the “Nonrenewal Notice Date”) in
each such twelve-month period to be agreed upon at the time such Letter of Credit is issued. Unless otherwise directed by the
applicable Issuing Bank, the Borrower shall not be required to make a specific request to such Issuing Bank for any such
renewal. Once an Auto-Renewal Letter of Credit has been issued, the Tranche 1 Revolving Lenders shall be deemed to have
authorized (but may not require) the applicable Issuing Bank to
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permit the renewal of such Letter of Credit at any time to an expiry date not later than the Letter of Credit Expiration Date;
provided, however, that no Issuing Bank shall (A) permit any such renewal if (1) such Issuing Bank has determined that it would
not be permitted at such time to issue such Letter of Credit in its renewed form under the terms hereof (by reason of the provisions
of clause (ii) or (iii) of Section 2.04(a) or otherwise) or (2) it has received written notice on or before the day that is thirty (30)
days before the Nonrenewal Notice Date from the Administrative Agent that the Required Lenders have elected not to permit such
renewal or (B) be obligated to permit such renewal if it has received written notice on or before the day that is thirty (30) days
before the Nonrenewal Notice Date from the Administrative Agent, any Tranche 1 Revolving Lender or the Borrower that one or
more of the applicable conditions set forth in Section 4.02 is not then satisfied, and in each such case directing the applicable
Issuing Bank not to permit such renewal.
(iv)
Promptly after its delivery of any Letter of Credit or any amendment to a Letter of Credit to an advising
bank with respect thereto or to the beneficiary thereof, the applicable Issuing Bank will also deliver to the Borrower and the
Administrative Agent a true and complete copy of such Letter of Credit or amendment.
(c)
Drawings and Reimbursement; Funding of Participations.
(i)
Upon receipt from the beneficiary of any Letter of Credit of any notice of a drawing under such Letter of
Credit, the applicable Issuing Bank shall notify the Borrower and the Administrative Agent thereof, and such Issuing Bank shall,
within a reasonable time following its receipt thereof, examine all documents purporting to represent a demand for payment under
such Letter of Credit. If an Issuing Bank notifies the Borrower of any payment by such Issuing Bank under a Letter of Credit,
then the Borrower or Co-Borrower, as applicable, shall reimburse such Issuing Bank in an amount equal to the amount of such
drawing not later than 3:00 p.m. (New York City time, in the case of drawings in Dollars or Canadian Dollars, or London time, in
the case of drawings in an Alternative Currency) on the next succeeding Business Day. If the Borrower or such Co-Borrower fails
to so reimburse such Issuing Bank by such time, such Issuing Bank shall promptly notify the Administrative Agent of such failure
and the Administrative Agent shall promptly thereafter notify each Tranche 1 Revolving Lender of such payment date, the amount
of the unreimbursed drawing (expressed in the Dollar Amount thereof in the case of an Alternative Currency) (the
“Reimbursement Obligations”) and the amount of such Lender’s Pro Rata Share thereof. In such event, (x) the Borrower or
such Co-Borrower shall be deemed to have requested a Tranche 1 Revolving Loan Borrowing of Base Rate Loans to be disbursed
on such date in an amount equal to such Reimbursement Obligation, without regard to the minimum and multiples specified in
Section 2.02(b) for the principal amount of Base Rate Loans and (y) in the case of Reimbursement Obligations denominated in an
Alternative Currency other than Canadian Dollars (but expressed in its Dollar Amount), the Borrower shall be deemed to have
requested on behalf of the applicable Tranche 1 Revolving Lender Tranche 1 Revolving Loans that are Eurocurrency Rate Loans
denominated in Dollars, in each case, to be disbursed on such date in an amount equal to (A) the Dollar Amount of such
Reimbursement Obligation, plus (B) in the case of any Reimbursement Obligation denominated in any Alternative Currency other
than Canadian Dollars (but expressed in its Dollar Amount), an additional amount equal to the amount required to convert Dollars
into the currency of the unreimbursed drawing, without regard to the minimum and multiples specified in Section 2.03(b) for the
principal amount of Base Rate Loans, but subject to the Line Cap and the conditions set forth in Section 4.02 (other than delivery
of a Committed Loan Notice). Any notice given by an Issuing Bank or the Administrative Agent pursuant to this clause (i) shall
be given in writing.
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(ii)
Each Tranche 1 Revolving Lender (including each Tranche 1 Revolving Lender acting as an Issuing Bank)
shall upon any notice pursuant to Section 2.04(c)(i) make funds available (and the Administrative Agent may apply Cash
Collateral provided for this purpose) for the account of the applicable Issuing Bank, in Dollars, Canadian Dollars or the applicable
Alternative Currency, at the Administrative Agent’s Office in an amount equal to its Pro Rata Share of the relevant
Reimbursement Obligation not later than 3:00 p.m. (New York City time) on the Business Day specified in such notice by the
Administrative Agent, whereupon, subject to the provisions of Section 2.04(c)(iii), each Tranche 1 Revolving Lender that so
makes funds available shall be deemed to have made a Tranche 1 Revolving Loan to the Borrower or Co-Borrower, as applicable,
that is (A) in the case of Letters of Credit denominated in Dollars or Canadian Dollars, a Base Rate Loan and (B) in the case of
Letters of Credit denominated in an Alternative Currency (other than Canadian Dollars), a Eurocurrency Rate Loan in such
Alternative Currency with an Interest Period of one month, in each case to the Borrower in such amount plus, in the case of any
Reimbursement Obligation denominated in any Alternative Currency (but expressed in its Dollar Amount), an additional amount
equal to the amount required to convert Dollars into the currency of the unreimbursed drawing. The Administrative Agent shall
remit the funds so received to the applicable Issuing Bank in accordance with the instructions provided to the Administrative
Agent by such Issuing Bank (which instructions may include standing payment instructions, which may be updated from time to
time by such Issuing Bank, provided that, unless the Administrative Agent shall otherwise agree, any such update shall not take
effect until the Business Day immediately following the date on which such update is provided to the Administrative Agent).
(iii)
With respect to any Reimbursement Obligation that is not fully refinanced by a Tranche 1 Revolving Loan
Borrowing of Base Rate Loans for Letters of Credit denominated in Dollars or Canadian Dollars or Eurocurrency Rate Loans for
Letters of Credit denominated in an Alternative Currency (other than Canadian Dollars), as the case may be, because the
conditions set forth in Section 4.02 cannot be satisfied or for any other reason, the Borrower or Co-Borrower, as applicable, shall
be deemed to have incurred from the applicable Issuing Bank a Letter of Credit Borrowing in the amount of the Reimbursement
Obligation that is not so refinanced plus, in the case of any Reimbursement Obligation denominated in an Alternative Currency
other than Canadian Dollars (but expressed in its Dollar Amount), an additional amount equal to the amount required to convert
Dollars into the currency of the unreimbursed drawing, which Letter of Credit Borrowing shall be due and payable on demand
(together with interest) and shall bear interest at the Default Rate then applicable to Tranche 1 Revolving Loans that are Base Rate
Loans. In such event, each Tranche 1 Revolving Lender’s payment to the Administrative Agent for the account of such Issuing
Bank pursuant to Section 2.04(c)(i) shall be deemed payment in respect of its participation in such Letter of Credit Borrowing and
shall constitute a Letter of Credit Advance from such Lender in satisfaction of its participation obligation under this Section.
(iv)
Until each Tranche 1 Revolving Lender funds its Tranche 1 Revolving Loan or Letter of Credit Advance to
reimburse the applicable Issuing Bank for any amount drawn under any Letter of Credit, interest in respect of such Lender’s Pro
Rata Share of such amount shall be solely for the account of such Issuing Bank.
(v)
Each Tranche 1 Revolving Lender’s obligations to make Tranche 1 Revolving Loans or Letter of Credit
Advances to reimburse an Issuing Bank for amounts drawn under Letters of Credit, as contemplated by this Section 2.04(c), shall
be absolute and unconditional and shall not be affected by any circumstance, including (A) any setoff, counterclaim, recoupment,
defense or other right which such Lender may have against such Issuing Bank, the Borrower, a Co-Borrower or any other Person
for any reason whatsoever; (B) the occurrence or continuance of a Default; or (C) any other occurrence, event or condition,
whether or not similar to any of the
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foregoing; provided that each Tranche 1 Revolving Lender’s obligation to make Tranche 1 Revolving Loans pursuant to this
paragraph (c) is subject to the conditions set forth in Section 4.02. No such funding of a participation in any Letter of Credit shall
relieve or otherwise impair the obligation of the Borrower or Co-Borrower, as applicable, to reimburse an Issuing Bank for the
amount of any payment made by such Issuing Bank under such Letter of Credit, together with interest as provided herein.
(vi)
If any Tranche 1 Revolving Lender fails to make available to the Administrative Agent for the account of the
applicable Issuing Bank any amount required to be paid by such Lender pursuant to the foregoing provisions of this paragraph (c)
by the time specified in Section 2.04(c)(ii), then, without limiting the other provisions of this Agreement, such Issuing Bank shall
be entitled to recover from such Lender (acting through the Administrative Agent), on demand, such amount with interest thereon
for the period from the date such payment is required to the date on which such payment is immediately available to such Issuing
Bank at a rate per annum equal to the greater of the Federal Funds Rate from time to time in effect and a rate determined by such
Issuing Bank in accordance with banking industry rules on interbank compensation, plus any reasonable administrative,
processing or similar fees customarily charged by such Issuing Bank in connection with the foregoing. If such Lender pays such
amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s Tranche 1 Revolving Loan included
in the relevant Borrowing or Letter of Credit Advance in respect of the relevant Letter of Credit Borrowing, as the case may be. A
certificate of the applicable Issuing Bank submitted to any Tranche 1 Revolving Lender (through the Administrative Agent) with
respect to any amounts owing under this clause (vi) shall be conclusive absent manifest error.
(d)
Repayment of Participations.
(i)
If, at any time after the applicable Issuing Bank has made payment in respect of any drawing under any Letter
of Credit issued by it and has received from any Tranche 1 Revolving Lender its Letter of Credit Advance in respect of such
payment in accordance with Section 2.04(c), if the Administrative Agent receives for the account of such Issuing Bank any
payment in respect of the related Reimbursement Obligation or, in the case of any Reimbursement Obligation denominated in any
Alternative Currency (but expressed in its Dollar Amount), an additional amount equal to the amount required to convert Dollars
into the currency of the unreimbursed drawing or, in each case, interest thereon (whether directly from the Borrower or otherwise,
including proceeds of Cash Collateral applied thereto by the Administrative Agent), the Administrative Agent will distribute to
such Lender its Pro Rata Share thereof (appropriately adjusted, in the case of interest payments, to reflect the period of time during
which such Lender’s Letter of Credit Advance was outstanding) in like funds as received by the Administrative Agent.
(ii)
If any payment received by the Administrative Agent for the account of the applicable Issuing Bank pursuant
to Section 2.04(c)(i) is required to be returned under any of the circumstances described in Section 11.06 (including pursuant to
any settlement entered into by such Issuing Bank in its discretion), each Tranche 1 Revolving Lender shall pay to the
Administrative Agent for the account of such Issuing Bank its Pro Rata Share thereof on demand of the Administrative Agent,
plus interest thereon from the date of such demand to the date such amount is returned by such Lender at a rate per annum equal to
the Federal Funds Rate from time to time in effect. The obligations of the Tranche 1 Revolving Lenders under this clause (ii) shall
survive the payment in full of the Obligations and the termination of this Agreement.
(e)
Obligations Absolute. The obligation of the Borrower and Co-Borrower to reimburse the Issuing Banks for each
drawing under each Letter of Credit and to repay each Letter of Credit Borrowing
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shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Agreement under all
circumstances, including the following:
(i)
any lack of validity or enforceability of such Letter of Credit or any term or provision thereof, any Loan
Document, or any other agreement or instrument relating thereto;
(ii)
the existence of any claim, counterclaim, setoff, defense or other right that the Borrower or Co-Borrowers
may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such
beneficiary or any such transferee may be acting), the Issuing Banks or any other Person, whether in connection with this
Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or
any unrelated transaction;
(iii)
any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or
delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit;
(iv)
any payment by an Issuing Bank under such Letter of Credit against presentation of documents that do not
comply strictly with the terms of such Letter of Credit; or any payment made by an Issuing Bank under such Letter of Credit to
any Person purporting to be a trustee in bankruptcy, debtor in possession, assignee for the benefit of creditors, liquidator, receiver
or other representative of or successor to any beneficiary or any transferee of such Letter of Credit, including arising in connection
with any case or 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
consent to departure from any guarantee, for all or any of the Obligations of the Borrower or Co-Borrowers in respect of such
Letter of Credit; or
(vi)
any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including
any other circumstance that might otherwise constitute a defense available to, or a discharge of, the Borrower or Co-Borrowers.
The Borrower shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of
any claim of noncompliance with the Borrower’s instructions or other irregularity, the Borrower will promptly notify the applicable Issuing
Bank. The Borrower and Co-Borrowers shall be conclusively deemed to have waived any such claim against any Issuing Bank and its
correspondents unless such notice is given as aforesaid.
(f)
Role of Issuing Banks. Each Tranche 1 Revolving Lender, the Borrower and each Co-Borrower agrees that, in paying
any drawing under a Letter of Credit, the Issuing Banks shall not have any responsibility to obtain any document (other than any sight draft,
certificates and documents expressly required by such Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any
document or the authority of the Person executing or delivering any document. None of any Issuing Bank, any Agent Affiliate nor any of the
respective correspondents, participants or assignees of any Issuing Bank shall be liable to any Tranche 1 Revolving Lender for (i) any action
taken or omitted in connection herewith at the request or with the approval of the requisite Tranche 1 Revolving Lenders; (ii) any action
taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability
of any document or instrument related to any Letter of Credit or Letter of Credit Application. The Borrower and the Co-Borrowers hereby
assumes all risks of the acts of omissions of any beneficiary or transferee with respect to its use of any Letter of Credit; provided that this
assumption is not
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intended to, and shall not, preclude the Borrower and the Co-Borrowers from pursuing such rights and remedies as it may have against the
beneficiary or transferee at law or under any other agreement. None of the Issuing Banks, any Agent Affiliate nor any of the respective
correspondents, participants or assignees of the Issuing Banks shall be liable or responsible for any of the matters described in
Section 2.04(e); provided that, notwithstanding anything in such clauses to the contrary, the Borrower or the Co-Borrowers may have a claim
against an Issuing Bank, and an Issuing Bank may be liable to the Borrower or the Co-Borrowers, to the extent, but only to the extent, of any
direct (as opposed to indirect, special, punitive, consequential or exemplary) damages suffered by the Borrower and the Co-Borrowers which
a court of competent jurisdiction determines in a final non-appealable judgment were caused by such Issuing Bank’s gross negligence or
willful misconduct or such Issuing Bank’s willful or grossly negligent failure to pay under any Letter of Credit after the presentation to it by
the beneficiary of a document(s) strictly complying with the terms and conditions of a Letter of Credit. In furtherance and not in limitation of
the foregoing, the applicable Issuing Bank may accept documents that appear on their face to be in order, without responsibility for further
investigation, regardless of any notice or information to the contrary, and the Issuing Banks shall not be responsible for the validity or
sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder
or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason. The Issuing Banks may send a Letter of
Credit or conduct any communication to or from the beneficiary via the Society for Worldwide Interbank Financial Telecommunication
(SWIFT) message or overnight courier, or any other commercially reasonable means of communication with a beneficiary.
(g)
Applicability of ISP. Unless otherwise expressly agreed by the applicable Issuing Bank and the Borrower when a
standby Letter of Credit is issued, the rules of the “International Standby Practices 1998” published by the Institute of International Banking
Law & Practice (or such later version thereof as may be in effect at the time of issuance) shall apply to such standby Letter of Credit.
(h)
Conflict with Letter of Credit Application. In the event of any conflict between the terms of this Agreement and the
terms of any Letter of Credit Application, the terms hereof shall control.
(i)
Reporting. Each day (or at such other intervals as the Administrative Agent and the applicable Issuing Bank shall
agree), the applicable Issuing Bank shall provide to the Administrative Agent a schedule of the Letters of Credit issued by it, in form and
substance reasonably satisfactory to the Administrative Agent, showing the date of issuance of each Letter of Credit, the account party, the
original face amount (if any), the expiration date, and the reference number of any Letter of Credit outstanding at any time during such
month, and showing the aggregate amount (if any) payable by the Borrower and the Co-Borrowers to such Issuing Bank during such month.
(j)
Existing Letters of Credit. Subject to the terms and conditions hereof, (i) Letters of Credit may be issued on the Closing
Date to backstop or replace letters of credit outstanding on the Closing Date or (ii) all letters of credit issued for the account of the Borrower
or any Restricted Subsidiary and outstanding on the Closing Date and issued by an entity that is an Issuing Bank under this Agreement,
which, by its execution of this Agreement, has agreed to act as an Issuing Bank hereunder and listed on Schedule 2.04 (each, an “Existing
Letter of Credit”) shall automatically be continued hereunder on the Closing Date by such Issuing Bank, and as of the Closing Date the
Lenders shall acquire a participation therein as if such Existing Letter of Credit were issued hereunder, and each such Existing Letter of
Credit shall be deemed a Letter of Credit for all purposes of this Agreement as of the Closing Date without any further action by the
Borrower.
(k)
Resignation and Removal of an Issuing Bank. Any Issuing Bank may resign as an Issuing Bank upon sixty (60) days’
prior written notice to the Administrative Agent, the Lenders and the Borrower; provided that (i) at least one Issuing Bank that was an Issuing
Bank as of the Closing Date shall remain as
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an Issuing Bank and (ii) the Letter of Credit Percentage of the Letter of Credit Sublimit of the resigning Issuing Banks shall automatically be
reallocated among the remaining Issuing Banks. Any Issuing Bank may be replaced at any time by written agreement among the Borrower,
the Administrative Agent, the Issuing Bank being replaced (provided that no consent will be required if the Issuing Bank being replaced has
no Letters of Credit or Reimbursement Obligations with respect thereto outstanding) and the successor Issuing Bank. The Administrative
Agent shall notify the Lenders of any such replacement of an Issuing Bank. At the time any such replacement or resignation shall become
effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank. From and after the effective date of
any such replacement or resignation, (i) any successor Issuing Bank shall have all the rights and obligations of an Issuing Bank under this
Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to
refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall
require. After the replacement or resignation of an Issuing Bank hereunder, the replaced or resigning Issuing Bank shall remain a party
hereto to the extent that Letters of Credit issued by it remain outstanding and shall continue to have all the rights and obligations of an
Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such replacement or resignation, but shall not be
required to issue additional Letters of Credit.
(l)
Cash Collateral Account. At any time and from time to time (i) after the occurrence and during the continuance of an
Event of Default, the Administrative Agent, at the direction or with the consent of the Required Lenders, may require the Borrower, to
deliver to the Administrative Agent such amount of cash as is equal to 103% of the aggregate Stated Amount of all Letters of Credit at any
time outstanding (whether or not any beneficiary under any Letter of Credit shall have drawn or be entitled at such time to draw thereunder)
and (ii) to the extent any amount of a required prepayment under Section 2.07(b)(i) remains after prepayment of all outstanding Loans and
Letter of Credit Obligations and termination of the Commitments, as contemplated by Section 2.07(d), the Administrative Agent will retain
such amount as may then be required to be retained, such amounts in each case under clauses (i) and (ii) above to be held by the
Administrative Agent in a Cash Collateral Account. The Borrower hereby grants (or, if registration thereof is required in any applicable
jurisdiction, shall grant) to the Administrative Agent, for the benefit of the Issuing Banks and the Lenders, a Lien upon and security interest
in the Cash Collateral Account and all amounts held therein from time to time as security for Letter of Credit Usage, and for application to
the Borrower’s and the Co-Borrowers’ Letter of Credit Obligations as and when the same shall arise. The Administrative Agent shall have
exclusive dominion and control, including the exclusive right of withdrawal, over such account. Other than any interest on the investment of
such amounts in Cash Equivalents, which investments shall be made at the direction of the Borrower (unless an Event of Default shall have
occurred and be continuing, in which case the determination as to investments shall be made at the option and in the discretion of the
Administrative Agent), amounts in the Cash Collateral Account shall not bear interest. Interest and profits, if any, on such investments shall
accumulate in such account. In the event of a drawing, and subsequent payment by the applicable Issuing Bank, under any Letter of Credit at
any time during which any amounts are held in the Cash Collateral Account, the Administrative Agent will deliver to such Issuing Bank an
amount equal to the Reimbursement Obligation created as a result of such payment plus any additional amount payable hereunder in respect
of any Reimbursement Obligation denominated in an Alternative Currency (or, if the amounts so held are less than such Reimbursement
Obligation, all of such amounts) to reimburse such Issuing Bank therefor. Any amounts remaining in the Cash Collateral Account after the
expiration of all Letters of Credit and reimbursement in full of each Issuing Bank for all of its obligations thereunder shall be held by the
Administrative Agent, for the benefit of the Borrower, to be applied against the Obligations in such order and manner as the Administrative
Agent may direct. If the Borrower is required to provide Cash Collateral pursuant to this Section 2.04(l), such amount (to the extent not
applied as aforesaid) shall be returned to the Borrower on demand, provided that after giving effect to such return (A) the sum of (1) the
aggregate principal dollar amount of all Tranche 1 Revolving Loans outstanding at such time and (2) the aggregate Letter of Credit Usage at
such time would
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not exceed the aggregate Tranche 1 Revolving Commitments at such time and (B) no Event of Default shall have occurred and be continuing
at such time. If the Borrower is required to provide Cash Collateral pursuant to Section 2.07(b), as contemplated by Section 2.07(d), such
amount shall be returned to the Borrower on demand; provided that, after giving effect to such return, all outstanding Letters of Credit shall
have expired and each Issuing Bank shall have been reimbursed in full for all of its obligations thereunder. If the Borrower is required to
provide Cash Collateral as a result of an Event of Default, such amount (to the extent not applied as aforesaid) shall be returned to the
Borrower within three Business Days after all Events of Default have been cured or waived.
(m)
Addition of an Issuing Bank. One or more Tranche 1 Revolving Lenders (other than a Defaulting Lender) selected by
the Borrower that agrees to act in such capacity and reasonably acceptable to the Administrative Agent may become an additional Issuing
Bank hereunder pursuant to a written agreement in form and substance reasonably satisfactory to the Administrative Agent among the
Borrower, the Administrative Agent and such Tranche 1 Revolving Lender. The Administrative Agent shall notify the Tranche 1 Revolving
Lenders of any such additional Issuing Bank.
Section 2.05
Conversion/Continuation
.
(a)
Each conversion of Loans from one Type to another, and each continuation of Eurocurrency Rate Loans shall be made
upon the Borrower’s irrevocable notice to the Administrative Agent, which may only be given in writing; provided that Revolving Loans
denominated in an Alternative Currency other than Canadian Dollars may not be converted into Base Rate Loans. Each such notice must be
received by the Administrative Agent not later than 1:00 p.m. (New York City time in the case of Loans denominated in Dollars, or London
time, in the case of Loans denominated in an Alternative Currency (other than Canadian Dollars)) on the requested date of any conversion of
Eurocurrency Rate Loans to Base Rate Loans and not later than 2:00 p.m. three Business Days prior to the requested date of continuation of
any Eurocurrency Rate Loans or any conversion of Base Rate Loans to Eurocurrency Rate Loans. Each notice by the Borrower pursuant to
this Section 2.05(a) must be delivered to the Administrative Agent in the form of a Conversion/Continuation Notice, appropriately completed
and signed by a Responsible Officer of the Borrower. Each conversion to or continuation of (x) Eurocurrency Rate Loans shall be in a
principal amount of $500,000 or a whole multiple of $100,000 in excess thereof, if denominated in Dollars, (y) Eurocurrency Rate Loans
shall be in a principal amount of C$500,000 or a whole multiple of C$100,000 in excess thereof, if denominated in Canadian Dollars or (z) a
Dollar Amount of $500,000 or a whole multiple of a Dollar Amount of $100,000 in excess thereof if denominated in an Alternative Currency
other than Canadian Dollars. Each conversion to Base Rate Loans (A) denominated in Dollars shall be in a principal amount of $500,000 or
a whole multiple of $100,000 in excess thereof and (B) denominated in Canadian Dollars shall be in a principal amount of C$500,000 or a
whole multiple of C$100,000 in excess thereof. Each Conversion/Continuation Notice shall specify (i) whether the Borrower is requesting a
conversion of Loans from one Type to the other, or a continuation of Eurocurrency Rate Loans, (ii) the requested date of the conversion or
continuation, as the case may be (which shall be a Business Day), (iii) the principal amount of Loans to be converted or continued, (iv) the
Class of Loans to be converted or continued, (v) the Type of Loans to which such existing Loans are to be converted, if applicable, (vi) if
applicable, which Borrower or Co-Borrower is the “borrower” under such Loans and (vi) if applicable, the duration of the Interest Period
with respect thereto. If (x) with respect to any Eurocurrency Rate Loans denominated in Dollars or Canadian Dollars, the Borrower fails to
give a timely notice requesting a conversion or continuation, then the applicable Loans shall be converted to Base Rate Loans, and (y) with
respect to any Eurocurrency Rate Loans denominated in any Alternative Currency other than Canadian Dollars, the Borrower fails to give a
timely notice requesting a conversion or continuation, then the applicable tranche of Revolving Loans shall be converted to a Eurocurrency
Rate Loan with an Interest Period of one month. Any such automatic conversion or continuation pursuant to the immediately preceding
sentence shall be effective as of the last day of the Interest Period then in effect with respect to
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the applicable Eurocurrency Rate Loans. If the Borrower requests a conversion to, or continuation of Eurocurrency Rate Loans in any such
Conversion/Continuation Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one
month. No Loan may be converted into or continued as a Loan denominated in a different currency, but instead must be prepaid in the
original currency of such Loan and reborrowed in the other currency.
(b)
Following receipt of a Conversion/Continuation Notice, the Administrative Agent shall promptly notify each applicable
Lender of its Pro Rata Share of the applicable Class of Loans, and if no timely notice of a conversion or continuation is provided by the
Borrower, the Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Loans or continuation
of Loans described in Section 2.05(a).
(c)
Except as otherwise provided herein, a Eurocurrency Rate Loan may be continued or converted only on the last day of
an Interest Period for such Eurocurrency Rate Loan. Upon the occurrence and during the continuation of an Event of Default, the
Administrative Agent or the Required Lenders may require by notice to the Borrower that no Loans denominated in Dollars or Canadian
Dollars may be converted to or continued as Eurocurrency Rate Loans. This Section shall not apply to Swing Line Loans or Protective
Advances, which may not be converted or continued.
Section 2.06
Availability
. Unless the Administrative Agent shall have received notice from a Lender prior to the date of any Borrowing that such Lender
will not make available to the Administrative Agent such Lender’s Pro Rata Share of such Borrowing, the Administrative Agent may assume
that such Lender has made such Pro Rata Share available to the Administrative Agent on the date of such Borrowing, and the Administrative
Agent may, in reliance upon such assumption, make available to the Borrower or Co-Borrower on such date a corresponding amount. If the
Administrative Agent shall have so made funds available, then, to the extent that such Lender shall not have made such portion available to
the Administrative Agent, each of such Lender and the Borrower or Co-Borrowers, as applicable, severally agrees to repay to the
Administrative Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date such
amount is made available to the Borrower or Co-Borrower until the date such amount is repaid to the Administrative Agent at (a) in the case
of the Borrower or Co-Borrower, the interest rate applicable at the time to the applicable Loans comprising such Borrowing and (b) in the
case of such Lender, the Overnight Rate plus any administrative, processing, or similar fees customarily charged by the Administrative Agent
in accordance with the foregoing. A certificate of the Administrative Agent submitted to any Lender with respect to any amounts owing
under this Section 2.06 shall be conclusive in the absence of manifest error. If the Borrower or Co-Borrowers, as applicable, and such Lender
shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative Agent shall promptly remit to
the Borrower or Co-Borrowers, as applicable, the amount of such interest paid by the Borrower or such Co-Borrowers for such period. If
such Lender pays its share of the applicable Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s
applicable Loan included in such Borrowing. Any payment by the Borrower or Co-Borrowers shall be without prejudice to any claim the
Borrower or such Co-Borrowers may have against a Lender that shall have failed to make such payment to the Administrative Agent. A
notice of the Administrative Agent to any Lender or the Borrower with respect to any amount owing under this subsection (b) shall be
conclusive, absent manifest error.
Section 2.07
Prepayments
.
(a)
Optional.
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(i)
The Borrower or Co-Borrowers may, upon notice to the Administrative Agent in the form of a Prepayment
Notice, at any time or from time to time, voluntarily prepay the Loans in whole or in part without premium or penalty; provided
that:
(A)
such Prepayment Notice must be received by the Administrative Agent (1) not later than 1:00 p.m.
(or such later time as may be agreed by the Administrative Agent in its reasonable discretion) (New York City time, in
the case of Loans denominated in Dollars or Canadian Dollars, or London time, in the case of Loans denominated in an
Alternative Currency (other than Canadian Dollars)) three Business Days prior to any date of prepayment of
Eurocurrency Rate Loans, (2) not later than 1:00 p.m. (or such later time as may be agreed by the Administrative Agent
in its reasonable discretion) one Business Day prior to any date of prepayment of Base Rate Loans and (3) not later than
1:00 p.m. (New York City time) one Business Day prior to any date of prepayment of Swing Line Loans or Protective
Advances;
(B)
any prepayment of Eurocurrency Rate Loans (x) denominated in Dollars shall be in a principal
amount of $1,000,000 or a whole multiple of $100,000 in excess thereof or, if less, the entire principal amount thereof
then outstanding, (y) denominated in Canadian Dollars shall be in a principal amount of C$1,000,000 or a whole
multiple of C$100,000 in excess thereof or, if less, the entire principal amount thereof then outstanding and (z)
denominated in an Alternative Currency (other than Canadian Dollars), shall be in a principal Dollar Amount of
$1,000,000 or a whole multiple of the Dollar Amount of $100,000 in excess thereof or, if less, the entire principal
amount thereof then outstanding; and
(C)
any prepayment of Base Rate Loans (A) denominated in Dollars shall be in a principal amount of
$1,000,000 or a whole multiple of $100,000 in excess thereof and (B) denominated in Canadian Dollars shall be in a
principal amount of C$1,000,000 or a whole multiple of C$100,000 in excess thereof or, in each case, if less, the entire
principal amount thereof then outstanding (it being understood that Base Rate Loans shall be denominated in Dollars or
Canadian Dollars only).
Each Prepayment Notice shall specify the date and amount of such prepayment and the Class(es) and Type(s) of Loans to be prepaid, if
applicable, which Co-Borrower is the “borrower” under such Loans, and the payment amount specified in each Prepayment Notice shall be
due and payable on the date specified therein. The Administrative Agent will promptly notify each Appropriate Lender of its receipt of a
Prepayment Notice and of the amount of such Lender’s Pro Rata Share of such prepayment; provided, “non-consenting” Lenders may be
repaid on a non-pro rata basis in connection with an Extension Offer and Disqualified Lenders may be repaid on a non-pro rata basis in
accordance with Section 11.27. Any prepayment of Loans shall be subject to Section 2.07(c). Revolving Loans, Incremental Revolving
Loans and Swing Line Loans prepaid pursuant to this subsection (a) may be reborrowed, subject to the terms and conditions of this
Agreement.
(ii)
Notwithstanding anything to the contrary contained in this Agreement, the Borrower may rescind, in whole
or in part, any notice of prepayment under Section 2.07(a)(i), if such prepayment would have resulted from a refinancing of all or
a portion of the applicable Facility which refinancing shall not be consummated or shall otherwise be delayed.
(iii)
(iv)
[Reserved].
[Reserved].
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(b)
Mandatory.
(i)
If at any time the Total Utilization of Revolving Commitments exceeds the Line Cap, then within one
Business Day thereof, the Borrower and Co-Borrowers shall prepay first, the Swing Line Loans and second, the Revolving Loans
to the extent necessary so that the Total Utilization of Revolving Commitments shall no longer exceed the Line Cap; provided that,
to the extent such excess amount is greater than the aggregate principal dollar amount of Swing Line Loans and Revolving Loans
outstanding immediately prior to the application of such prepayment, the amount so prepaid shall be retained by the
Administrative Agent and held in the Cash Collateral Account as cover for Letter of Credit Usage, as more particularly described
in Section 2.04(l), and thereupon such cash shall be deemed to reduce the aggregate Letter of Credit Usage by an equivalent
amount; provided, further, that (1) if the circumstances described in this clause (i) are the result of the imposition of or increase in
a Reserve, the Borrower and Co-Borrowers shall not be required to make the initial prepayment or deposit until the fifth Business
Day following the date on which Administrative Agent notifies the Borrower of such imposition or increase and (2) the Letter of
Credit Usage may not be reduced to less than zero.
(ii)
At all times after the occurrence and during the continuance of a Cash Dominion Period and notification
thereof by the Administrative Agent to the Borrower (subject to the provisions of Sections 2.19, 9.03 and to the terms of the
Security Agreement), on each Business Day, at or before 11:00 a.m., New York City time, the Administrative Agent shall apply all
immediately available funds credited to the Administrative Agent Account or otherwise received by Administrative Agent for
application to the Obligations or Secured Obligations (in the case of clause sixth and clause eighth below), first, to payment of any
fees, indemnities, expenses and other amounts (other than principal and interest, but including Attorney Costs payable under
Section 11.04 and amounts payable under Article III) payable to the Administrative Agent and Collateral Agent in their capacity
as such; second, to payment in full of Unfunded Advances/Participations (the amounts so applied to be distributed between or
among, as applicable, the Administrative Agent and the Issuing Banks pro rata in accordance with the amounts of Unfunded
Advances/Participations owed to them on the date of any such distribution); third, to payment of fees, indemnities and other
amounts (other than principal and interest and Letter of Credit fees) payable to the Lenders and the Issuing Banks (including
Attorney Costs payable under Section 11.04 and amounts payable under Article III), ratably among them in proportion to the
amounts described in this clause third payable to them; fourth, to payment of accrued and unpaid Letter of Credit fees and interest
on the Loans and Letter of Credit Usage, ratably among the Lenders and the Issuing Banks in proportion to the respective amounts
described in this clause fourth held by them; fifth, to pay the principal of Protective Advances; sixth, ratably, (a) to payment of
unpaid principal of the Loans (other than Protective Advances) and the Letter of Credit Usage, (b) to the extent a Bank Products
Reserve has been established therefor by the Administrative Agent in accordance with the terms hereof, to pay the unpaid
Reserved Secured Hedge Obligations, including the cash collateralization of such Reserved Secured Hedge Obligations, (c) to the
extent a Bank Products Reserve has been established therefor by the Administrative Agent in accordance the terms hereof, to pay
the unpaid Reserved Secured Cash Management Obligations, (d) to Cash Collateralize Letters of Credit (to the extent not
otherwise Cash Collateralized pursuant to the terms of this Agreement) (in an amount equal to 103% of the maximum face amount
of all outstanding Letters of Credit); provided that (i) any such amounts applied pursuant to the foregoing subclause (d) shall be
paid to the Administrative Agent for the ratable account of the Issuing Banks to Cash Collateralize such Letters of Credit, (ii)
subject to Section 2.04 and Section 2.19, amounts used to Cash Collateralize the aggregate undrawn amount of Letters of Credit
pursuant to this clause sixth shall be applied to satisfy drawings under such Letters of Credit as they occur and (iii) upon the
expiration of any Letter of Credit, the pro rata share of Cash Collateral attributable to such expired
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Letter of Credit shall be applied by the Administrative Agent in accordance with the priority of payments set forth in this Section
2.07(b)(ii); seventh, ratably to pay other Obligations then due (other than Obligations in respect of Secured Cash Management
Services and Secured Hedge Agreements), until paid in full; eighth, ratably to pay other Obligations in respect of the Secured
Cash Management Services and Secured Hedge Agreements, until paid in full; ninth, to the payment of all other Obligations of the
Loan Parties (other than contingent indemnification obligations for which no claim has yet been made) that are due and payable to
the Administrative Agent and the other Secured Parties on such date, ratably based upon the respective aggregate amounts of all
such Obligations owing to the Administrative Agent and the other Secured Parties on such date; and last, as the Borrower may
direct.
(c)
Interest, Funding Losses, Etc. All prepayments under this Section 2.07 shall be accompanied by all accrued interest
thereon, together with, in the case of any such prepayment of a Eurocurrency Rate Loan on a date prior to the last day of an Interest Period
therefor, any amounts owing in respect of such Eurocurrency Rate Loan pursuant to Section 3.05.
(d)
Application of Prepayment Amounts. In the event that the obligation of the Borrower and Co-Borrowers to prepay the
Loans shall arise pursuant to subsection (b)(i) above,
(i)
first, the Borrower and Co-Borrowers shall prepay the outstanding principal amount of the Swing Line Loans,
without a corresponding permanent reduction to the Revolving Commitments,
(ii)
second, to the extent of any excess remaining after the prepayment as provided in clause (i) above, the
Borrower and Co-Borrowers shall pay any outstanding Reimbursement Obligations in respect of Letters of Credit,
(iii)
third, to the extent of any excess remaining after application as provided in clauses (i) and (ii) above, the
Borrower and Co-Borrowers shall prepay the outstanding principal amount of the Revolving Loans, without a corresponding
permanent reduction to the Revolving Commitments, and
(iv)
fourth, to the extent of any excess remaining after application as provided in clauses (i), (ii) and (iii) above,
thereafter the Borrower and Co-Borrowers shall Cash Collateralize the Letter of Credit Usage pursuant to Section 2.04(l).
Each payment or prepayment pursuant to the provisions of Section 2.07(b) shall be applied ratably among the Lenders of each Class holding
the Loans being prepaid, in proportion to the principal amount held by each, and shall be applied as among the Revolving Loans being
prepaid, (A) first, to prepay all Base Rate Loans and (B) second, to the extent of any excess remaining after application as provided in clause
(A) above, to prepay all Eurocurrency Rate Loans (and as among Eurocurrency Rate Loans, (1) first to prepay those Eurocurrency Rate
Loans, if any, having Interest Periods ending on the date of such prepayment, and (2) thereafter, to the extent of any excess remaining after
application as provided in clause (1) above, to prepay any Eurocurrency Rate Loans in the order of the expiration dates of the Interest Periods
applicable thereto).
Section 2.08
Termination or Reduction of Commitments
.
(a)
Optional. The Borrower may, upon written notice to the Administrative Agent, terminate the unused Commitments of
any 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
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by the Administrative Agent one Business Day prior to the date of termination or reduction, (ii) any such partial reduction shall be in an
aggregate amount of $1,000,000 or any whole multiple of $500,000 in excess thereof or, if less, the entire amount thereof and (iii) the
Borrower shall not terminate or reduce (A) the Revolving Commitments if, after giving effect to any concurrent prepayment of the Revolving
Loans in accordance with Section 2.07, the Total Utilization of Revolving Commitments would exceed the Line Cap, (B) the Letter of Credit
Sublimit if, after giving effect thereto, (1) the Letter of Credit Usage not fully Cash Collateralized hereunder at 103% of the maximum face
amount of any such Letters of Credit would exceed the Letter of Credit Sublimit or (2) the Letter of Credit Usage with respect to Letters of
Credit issued by an applicable Issuing Bank not fully Cash Collateralized hereunder at 103% of the maximum face amount of any such
Letters of Credit would exceed the amount of such Issuing Bank’s Letter of Credit Percentage of the Letter of Credit Sublimit or (C) the
Swing Line Sublimit, if after giving effect to any concurrent payment of Swing Line Loans in accordance with Section 2.07, the Total
the Swing Line
respect
Utilization of Tranche 1 Revolving Commitments with
Sublimit. Notwithstanding the foregoing, the Borrower may rescind or postpone any notice of termination of the Commitments if such
termination would have resulted from a refinancing of all or a portion of the applicable Facility, which refinancing shall not be consummated
or otherwise shall be delayed.
to Swing Line Loans would exceed
(b)
Mandatory.
(i)
(A) The Tranche 1 Revolving Commitments shall terminate on the Revolving Commitment Termination Date.
The Tranche 2 Revolving Commitments shall terminate on the Revolving Commitment Termination Date
(ii)
If after giving effect to any reduction or termination of Tranche 1 Revolving Commitments under this
Section 2.08, the Letter of Credit Sublimit or the Swing Line Sublimit exceeds the amount of the Tranche 1 Revolving
Commitments at such time, the Letter of Credit Sublimit or the Swing Line Sublimit, as the case may be, shall be automatically
reduced by the amount of such excess.
(c)
Effect of Termination or Reduction. Any termination or reduction of the Commitments of any Class shall be
permanent. Each reduction of Commitments of any Class shall be made ratably among the Lenders in accordance with their respective Pro
Rata Share of Commitments of such Class.
Section 2.09
Repayment of Loans
.
(a)
The Borrower or Co-Borrower, as applicable, shall repay to the Administrative Agent (i) for the ratable account of the
Appropriate Lenders the outstanding principal amount of Revolving Loans on the Revolving Commitment Termination Date and (ii) the then
unpaid amount of each Protective Advance on the earliest of (A) the Revolving Commitment Termination Date or, if applicable, the Latest
Maturity Date, and (B) 45 days (or such longer period as may be consented to by the Administrative Agent) after such Protective Advance is
made; provided that on each date that a Revolving Loan is made while any Protective Advance is outstanding, the Borrower shall repay all
Protective Advances with the proceeds of such Revolving Loan.
(b)
The Borrower or Co-Borrower, as applicable, shall repay to the Swing Line Lender (or, to the extent required by
Section 2.03(c), to the Administrative Agent for the account of the Tranche 1 Revolving Lenders) each Swing Line Loan made by the Swing
Line Lender on the earlier to occur of (i) the date seven (7) Business Days after such Swing Line Loan is made and (ii) the Maturity Date of
the Tranche 1 Revolving Loans; provided, on each date that a Tranche 1 Revolving Loan is made, the Borrower or such Co-Borrower shall
repay all Swing Line Loans then outstanding. At any time there shall exist a Defaulting Lender that is a Tranche 1 Revolving Lender,
immediately upon the request of the Swing Line
107
Lender, the Borrower or Co-Borrowers, as applicable, shall repay the outstanding Swing Line Loans made by the Swing Line Lender to the
Borrower or Co-Borrower, as applicable, in an amount sufficient to eliminate any Fronting Exposure in respect of the Swing Line Loans.
Section 2.10
Interest
.
(a)
Subject to the provisions of Section 2.10(b), (i) each Eurocurrency Rate Loan shall bear interest on the outstanding
principal amount thereof for each Interest Period at a rate per annum equal to the applicable Adjusted Eurocurrency Rate for such Interest
Period plus the Applicable Rate, (ii) each Base Rate Loan shall bear interest on the outstanding principal amount thereof from the applicable
Borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate, and (iii) each Swing Line Loan and each Protective
Advance shall bear interest on the outstanding principal amount thereof from the applicable Borrowing date at a rate per annum equal to the
Base Rate plus the Applicable Rate.
(b)
If any amount of principal of any Loan is not paid when due (without regard to any applicable grace periods), whether
at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.
(c)
If any amount (other than principal of any Loan) payable by the Borrower or Co-Borrower under any Loan Document
is not paid when due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, then upon the
request of the Required Lenders (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower or
Co-Borrower under the Bankruptcy Code or any other Debtor Relief Law, automatically and without further action by the Administrative
Agent or any Lender) such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate
to the fullest extent permitted by applicable Laws.
(d)
Accrued and unpaid interest on the principal amount of all outstanding past due Obligations (including interest on past
due interest) shall be due and payable upon demand (or, after the occurrence of an actual or deemed entry of an order for relief with respect to
the Borrower or Co-Borrower under the Bankruptcy Code or any other Debtor Relief Law, automatically and without further action by the
Administrative Agent or any Lender).
(e)
Interest on each Loan shall be due and payable (i) with respect to Base Rate Loans, in arrears on each Interest Payment
Date applicable thereto and at such other times as may be specified herein and (ii) with respect to Eurocurrency Rate Loans, at the end of
each Interest Period, and, in any event, every three months. Interest hereunder shall be due and payable in accordance with the terms hereof
before and after judgment, and before and after the commencement of any case or proceeding under any Debtor Relief Law.
(f)
The Administrative Agent shall promptly notify the Borrower and the Lenders of the interest rate applicable to any
Interest Period for any Eurocurrency Rate Loans upon determination of such interest rate. The determination of the Adjusted Eurocurrency
Rate and the Eurocurrency Rate by the Administrative Agent shall be conclusive in the absence of manifest error. At any time when Base
Rate Loans are outstanding, the Administrative Agent shall notify the Borrower and the Lenders of any change in the “prime rate” used in
determining the Base Rate promptly following the public announcement of such change.
(g)
After giving effect to all Borrowings, all conversions of Loans from one Type to the other, and all continuations of
Loans as the same Type, there shall not be more than ten Interest Periods in effect unless otherwise agreed between the Borrower and the
Administrative Agent; provided that after the
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establishment of any new Class of Loans pursuant to an Extension, the number of Interest Periods otherwise permitted by this Section 2.10(g)
shall increase by three Interest Periods for each applicable Class so established.
Section 2.11
Fees
.
(a)
The Borrower shall pay to the Agents such fees as shall have been separately agreed upon in writing (including
pursuant to any fee letter executed with the Agents in connection with the Facility) in the amounts and at the times so specified. Such fees
shall be fully earned when due and shall not be refundable for any reason whatsoever (except as expressly agreed between the Borrower and
the applicable Agent).
(b)
The Borrower agrees to pay to Lenders having Revolving Exposure:
(i)
commitment fees for the period from and including the Closing Date to and including the Revolving
Commitment Termination Date equal to (A) the average of the daily difference between (1) the Revolving Commitments of a
Class and (2) the sum of (I) the aggregate principal amount of all outstanding Revolving Loans of such Class plus (II) the Letter of
Credit Usage, times (B) the Applicable Commitment Fee; and
(ii)
letter of credit fees with respect to all Letters of Credit (other than trade Letters of Credit) (the “L/C Fee”)
equal to the (A) Applicable Rate for Tranche 1 Revolving Loans that are Eurocurrency Rate Loans (or, with respect to trade
Letters of Credit, 50% of the Applicable Rate for Tranche 1 Revolving Loans that are Eurocurrency Rate Loans), times (B) the
maximum amount available to be drawn under all Letters of Credit (regardless of whether any conditions for drawing could then
be met and determined as of the close of business on any date of determination and whether or not such maximum amount is then
in effect under such Letter of Credit if such maximum amount increases periodically pursuant to the terms of such Letter of
Credit).
All fees referred to in this Section 2.11(b) shall be paid to the Administrative Agent at the Administrative Agent’s Office and upon receipt,
the Administrative Agent shall promptly distribute to each Lender its Pro Rata Share thereof. In addition, for purposes of calculating the
commitment fees referred to in clause (b)(i) only, no portion of the Tranche 1 Revolving Commitments shall be deemed utilized as a result of
outstanding Swing Line Loans.
(c)
The Borrower agrees to pay directly to the applicable Issuing Bank, for its own account, the following fees:
(i)
a fronting fee to be agreed by the Borrower and the applicable Issuing Bank (not to exceed 0.125% per
annum) times the maximum Dollar Amount then available to be drawn under such Letter of Credit (whether or not such maximum
amount is then in effect under such Letter of Credit if such maximum amount increases periodically pursuant to the terms of such
Letter of Credit) determined as of the close of business on any date of determination; and
(ii)
such documentary and processing charges for any issuance, amendment, transfer or payment of a Letter of
Credit as are in accordance with such Issuing Bank’s standard schedule for such charges and as in effect at the time of such
issuance, amendment, transfer or payment, as the case may be, which fees, costs and charges shall be payable to such Issuing
Bank within three Business Days after its demand therefor and are nonrefundable.
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Each payment of fees required above under this clause (c) on any Letters of Credit, whether denominated in Dollars or an Alternative
Currency, shall be made in Dollars.
(d)
All fees referred to in Sections 2.11(b) and 2.11(c)(i) shall be payable quarterly in arrears on the first day following the
last day of each fiscal quarter of each year during the Revolving Commitment Period, commencing with the first day following the first full
fiscal quarter ending after the Closing Date, and on the Revolving Commitment Termination Date; provided that any such fees accruing after
the Revolving Commitment Termination Date shall be payable on demand.
(e)
The Borrower agrees to pay to the Administrative Agent for its own account the fees payable in the amounts and at the
times separately agreed upon.
Section 2.12
Computation of Interest and Fees
. (a) All computations of Base Rate Loans calculated by reference to the “prime rate” or Federal Funds Rate shall be made on the
basis of a year of 365 days or 366 days, as the case may be (or 365 days for Loans denominated in Canadian Dollars), and actual days
elapsed. All other computations of fees and interest shall be made on the basis of a 360-day year and actual days elapsed (which results in
more fees or interest, as applicable, being paid than if computed on the basis of a 365-day year). Interest shall accrue on each Loan for the
day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof, for the day on which the Loan or such portion is paid;
provided that any Loan that is repaid on the same day on which it is made shall, subject to Section 2.10(a), bear interest for one day. Each
determination by the Administrative Agent of an interest rate or fee hereunder shall be conclusive and binding for all purposes, absent
manifest error. For the purposes of the Interest Act (Canada), the yearly rate of interest to which any rate calculated on the basis of a period
of time different from the actual number of days in the year (360 days, for example) is equivalent is the stated rate multiplied by the actual
number of days in the year (365 or 366, as applicable) and divided by the number of days in the shorter period (360 days, in the example) and
the Canadian Loan Parties acknowledge that there is a material distinction between the nominal and effective rates of interest and that they
are capable of making the calculations necessary to compare such rates and that the calculations herein are to be made using the nominal rate
method and not on any basis that gives effect to the principle of deemed reinvestment of interest. Each of the Canadian Loan Parties
confirms that it understands and is able to calculate the rate of interest applicable to the Obligations based on the methodology for calculating
per annum rates provided in this Agreement. Each of the Canadian Loan Parties irrevocably agrees not to plead or assert, whether by way of
defense or otherwise, in any proceeding relating to this Agreement or any other Loan Document, that the interest payable under this
Agreement and the calculation thereof has not been adequately disclosed to the Canadian Loan Parties as required pursuant to section 4 of the
Interest Act (Canada).
(b) If any provision of this Agreement or of any of the other Loan Documents would obligate any Loan Party to make any
payment of interest or other amount payable to the Lenders in an amount or calculated at a rate which would be prohibited by law or would
result in a receipt by the Lenders of interest at a criminal rate (as such terms are construed under the Criminal Code (Canada)) then,
notwithstanding such provisions, such amount or rate shall be deemed to have been adjusted with retroactive effect to the maximum amount
or rate of interest, as the case may be, as would not be so prohibited by law or so result in a receipt by the Lenders of interest at a criminal
rate, such adjustment to be effected, to the extent necessary, as follows: (1) firstly, by reducing the amount or rate of interest required to be
paid to the Lenders under this Section 2, and (2) thereafter, by reducing any fees, commissions, premiums and other amounts required to be
paid to the Lenders which would constitute “interest” for purposes of Section 347 of the Criminal Code (Canada). Notwithstanding the
foregoing, and after giving effect to all adjustments contemplated thereby, if the Lenders shall have received an amount in excess of the
maximum permitted by that section of the Criminal Code (Canada), the Loan Parties shall be entitled, by notice in writing to the
Administrative Agent, to obtain reimbursement from
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the Lenders in an amount equal to such excess and, pending such reimbursement, such amount shall be deemed to be an amount payable by
the Lenders to the Borrower. Any amount or rate of interest referred to in this Section 2.12(b) shall be determined in accordance with
generally accepted actuarial practices and principles as an effective annual rate of interest over the term that the applicable Loan remains
outstanding on the assumption that any charges, fees or expenses that fall within the meaning of “interest” (as defined in the Criminal Code
(Canada)) shall, if they relate to a specific period of time, be pro-rated over that period of time and otherwise be pro-rated over the period
from the Closing Date to the Maturity Date and, in the event of a dispute, a certificate of a Fellow of the Canadian Institute of Actuaries
appointed by the Administrative Agent shall be conclusive for the purposes of such determination.
Section 2.13
Evidence of Indebtedness
.
(a)
The Borrowings made by each Lender shall be evidenced by one or more accounts or records maintained by such
Lender and evidenced by one or more entries in the Register maintained by the Administrative Agent, acting solely for purposes of Treasury
Regulation Section 5f.103-1(c), as non-fiduciary agent for the Borrower and the Co-Borrowers, in each case in the ordinary course of
business. The accounts or records maintained by the Administrative Agent and each Lender shall be prima facie evidence absent manifest
error of the amount of the Borrowings made by the Lenders to the Borrower and the Co-Borrowers and the interest and payments
thereon. Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrower and the
Co-Borrowers hereunder to pay any amount owing with respect to the Obligations. In the event of any conflict between the accounts and
records maintained by any Lender and the accounts and records of the Administrative Agent in respect of such matters, the accounts and
records of the Administrative Agent shall control in the absence of manifest error.
(b)
Upon the request of any Lender made through the Administrative Agent, the Borrower and the Co-Borrowers shall
execute and deliver to such Lender (through the Administrative Agent) a Note payable to such Lender, which shall evidence the relevant
Class of such Lender’s Loans in addition to such accounts or records. Each Lender may attach schedules to its Note and endorse thereon the
date, Type (if applicable), amount and maturity of its Loans and payments with respect thereto.
Section 2.14
Payments Generally
.
(a)
All payments to be made by the Borrower or the Co-Borrowers shall be made on the date when due, in immediately
available funds without condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided
herein, all payments by the Borrower or the Co-Borrowers hereunder shall be made to the Administrative Agent, for the account of the
respective Lenders to which such payment is owed, at the applicable Administrative Agent’s Office for payment and in Same Day Funds not
later than 1:00 p.m. (New York City time, in the case of any payment in Dollars or Canadian Dollars, or London time, in the case of any
payment in an Alternative Currency (other than Canadian Dollars)) on the date specified herein. If, for any reason, the Borrower is
prohibited by any Law from making any required payment hereunder in an Alternative Currency (other than Canadian Dollars), the Borrower
shall make such payment in Dollars in the Dollar Amount of the Alternative Currency payment amount. The Administrative Agent will
promptly distribute to each Appropriate Lender its Pro Rata Share (or other applicable share as provided herein) of such payment in like
funds as received by wire transfer to such Lender’s Lending Office; provided that the proceeds of any borrowing of Tranche 1 Revolving
Loans to finance the reimbursement of a drawn Letter of Credit as provided in Section 2.04(c) shall be remitted by the Administrative Agent
to the applicable Issuing Bank. All payments received by the Administrative Agent after 1:00 p.m. (New York City time, in the case of any
payment in Dollars or Canadian Dollars, or London time, in the case of any payment in an Alternative Currency (other than Canadian
Dollars)) shall in each case be deemed received on the next succeeding Business Day and any
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applicable interest or fee shall continue to accrue. At all times during which a Cash Dominion Period exists, solely for purposes of
determining the Total Utilization of Revolving Commitments, checks and cash or other immediately available funds from collections of items
of payment and proceeds of any Collateral shall be applied in whole or in part against the Obligations, on the day of receipt, subject to actual
collection.
(b)
If any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made
on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.
(c)
Unless the Borrower has notified the Administrative Agent, prior to the date any payment is required to be made by it
to the Administrative Agent hereunder for the account of any Lender or any Issuing Bank, as applicable, that the Borrower or the Co-
Borrowers will not make such payment, the Administrative Agent may assume that the Borrower or the Co-Borrowers has timely made such
payment and may (but shall not be so required to), in reliance thereon, make available a corresponding amount to such Lender or such
Issuing Bank. If and to the extent that such payment was not in fact made to the Administrative Agent in Same Day Funds, then such Lender
or such Issuing Bank, as applicable, shall forthwith on demand repay to the Administrative Agent the portion of such assumed payment that
was made available to such Lender or such Issuing Bank in Same Day Funds, together with interest thereon in respect of each day from and
including the date such amount was made available by the Administrative Agent to such Lender or such Issuing Bank, as applicable, to the
date such amount is repaid to the Administrative Agent in Same Day Funds at the applicable Overnight Rate from time to time in effect. A
notice of the Administrative Agent to any Lender with respect to any amount owing under this subsection (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 provided
in the foregoing provisions of this Article II, and such funds are not made available to the Borrower or the Co-Borrowers by the
Administrative Agent because the applicable conditions to the Borrowing set forth in Article IV are not satisfied or waived in accordance
with the terms hereof, the Administrative 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, to fund participations in Letters of Credit, Swing Line Loans
and Protective Advances and to make payments pursuant to Section 10.07 are several and not joint. The failure of any Lender to make any
Loan on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and no Lender
shall be responsible for the failure of any other Lender to so make its 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 or
manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or
manner.
(g)
Whenever any payment received by the Administrative Agent under this Agreement or any of the other Loan
Documents is insufficient to pay in full all amounts due and payable to the Administrative Agent and the Lenders under or in respect of this
Agreement and the other Loan Documents on any date, such payment shall be distributed by the Administrative Agent and applied by the
Administrative Agent and the Lenders in the order of priority set forth in Section 9.03. If the Administrative Agent receives funds for
application to the Obligations of the Loan Parties under or in respect of the Loan Documents under circumstances for which the Loan
Documents do not specify the manner in which such funds are to be applied, the Administrative Agent may, but shall not be obligated to,
elect to distribute such funds to each of the Lenders in accordance with such Lender’s Pro Rata Share of such of the outstanding Loans or
other Obligations then owing to such Lender.
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(h)
If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.03(c), 2.04(c), 2.06, 2.15
or 10.07, then the Administrative Agent may, in its discretion and notwithstanding any contrary provision hereof, (i) apply any amounts
thereafter received by the Administrative Agent for the account of such Lender for the benefit of the Administrative Agent, the Swing Line
Lender or the Issuing Banks, as applicable, to satisfy such Lender’s obligations to the Administrative Agent, the Swing Line Lender and the
Issuing Banks until all such unsatisfied obligations are fully paid and/or (ii) hold any such amounts in a segregated account as cash collateral
for, and application to, any future funding obligations of such Lender under any such Section, in the case of each of clauses (i) and (ii) above,
in any order as determined by the Administrative Agent in its discretion.
Section 2.15
Sharing of Payments, Etc.
If, other than as expressly provided elsewhere herein, any Lender shall obtain payment in respect of any principal of or interest
on account of the Loans of a particular Class made by it (whether voluntary, involuntary, through the exercise of any right of setoff, or
otherwise) 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 them and/or such
subparticipations in the participations in L/C obligations, Swing Line Loans or Protective Advances held by them, as the case may be, as
shall be necessary to cause such purchasing Lender to share the excess payment in respect of such Loans or such participations, as the case
may be, pro rata with each of them; provided that if all or any portion of such excess payment is thereafter recovered from the purchasing
Lender under any of the circumstances described in Section 11.06 (including pursuant to any settlement entered into by the purchasing
Lender in its discretion), such purchase shall to that extent be rescinded and each relevant Lender shall repay to the purchasing Lender the
purchase price paid therefor, together with an amount equal to such paying Lender’s ratable share (according to the proportion of (i) the
amount of such paying Lender’s required repayment to (ii) the total amount so recovered from the purchasing Lender) of any interest or other
amount paid or payable by the purchasing Lender in respect of the total amount so recovered, without further interest thereon. The
provisions of this paragraph shall not be construed to apply to (A) any payment made by the Borrower or the Co-Borrowers pursuant to and
in accordance with the express terms of this Agreement as in effect from time to time (including Section 11.07), (B) any payment obtained by
a Lender as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or participant permitted
hereunder or (C) any payment received by such Lender not in its capacity as a Lender. The Borrower agrees that any Lender so purchasing 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 11.09) with respect to such participation as fully as if such Lender were the direct creditor of the
Borrower or the Co-Borrowers in the amount of such participation. The Administrative Agent will keep records (which shall be conclusive
and binding in the absence of manifest error) of participations purchased under this Section 2.15 and will in each case notify the Lenders
following any such purchases or repayments. Each Lender that purchases a participation pursuant to this Section 2.15 shall from and after
such purchase have the right to give all notices, requests, demands, directions and other communications under this Agreement with respect
to the portion of the Obligations purchased to the same extent as though the purchasing Lender were the original owner of the Obligations
purchased.
Section 2.16
Incremental Borrowings
.
(a)
Notice. At any time and from time to time, on one or more occasions, the Borrower may (on behalf of itself and/or any
Co-Borrower), by notice to the Administrative Agent, increase the aggregate principal amount of any class of Revolving Commitments (the
“Incremental Revolving Facilities” and the revolving loans and other extensions of credit made thereunder, the “Incremental Revolving
Loans”; each such increase, an “Incremental Facility” and the loans or other extensions of credit made thereunder, the “Incremental
Loans”).
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(b)
Ranking. Incremental Facilities will rank pari passu in right of payment with the Revolving Commitments and will be
secured by the Collateral by Liens on a pari passu basis to the Liens that secure the Revolving Commitments.
(c)
Size and Currency. The aggregate principal amount of Incremental Facilities on any date commitments with respect
thereto are first received (or, in the case of an LCA Election, as of the applicable LCA Test Date), assuming such commitments are fully
drawn only on the date of receipt thereof, will not exceed, an amount equal to, the Incremental Amount. Each Incremental Facility will be in
an integral multiple of $1,000,000 and in an aggregate principal amount that is not less than $5,000,000 (or such lesser minimum amount
approved by the Administrative Agent in its reasonable discretion); provided that such amount may be less than such minimum amount or
integral multiple amount if such amount represents all the remaining availability under the Incremental Amount at such time. Any
Incremental Facility shall be denominated in Dollars but, may be borrowed in Alternative Currencies in accordance with the terms of the
Revolving Facility.
(d)
Incremental Lenders. Incremental Facilities may be provided by any existing Lender (it being understood that no
existing Lender shall have an obligation to make, or provide commitments with respect to, an Incremental Loan) or by any Additional
Lender. While existing Lenders may (but are not obligated to unless invited to and so elect) participate in any syndication of an Incremental
Facility and may (but are not obligated to unless invited to and so elect) become lenders with respect thereto, the existing Lenders will not
have any right to participate in any syndication of, and will not have any right of first refusal or other right to provide all or any portion of,
any Incremental Facility or Incremental Loan except to the extent the Borrower and the arrangers thereof, if any, in their discretion, choose to
invite or include any such existing Lender (which may or may not apply to all existing Lenders and may or may not be pro rata among
existing Lenders). Final allocations in respect of Incremental Facilities will be made by the Borrower together with the arrangers thereof, if
any, in their discretion, on the terms permitted by this Section 2.16; provided that the lenders providing the Incremental Facilities will be
reasonably acceptable to (i) the Borrower, (ii) the Administrative Agent, (iii) each Issuing Bank and (iv) the Swing Line Lender (except that,
in the case of clauses (ii), (iii) and (iv) only to the extent such Person otherwise would have a consent right to an assignment of such loans or
commitments to such lender, such consent not to be unreasonably withheld, conditioned or delayed).
(e)
Incremental Facility Amendments; Use of Proceeds. Each Incremental Facility will become effective pursuant to an
amendment (each, an “Incremental Amendment”) to this Agreement and, as appropriate, the other Loan Documents, executed by the
Borrower, each Co-Borrower and each Person providing such Incremental Facility and the Administrative Agent. The Administrative Agent
will promptly notify each Lender as to the effectiveness of each Incremental Amendment. Incremental Amendments may, without the
consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary, advisable or
appropriate, in the reasonable opinion of the Borrower in consultation with the Administrative Agent, to effect the provisions of this
Section 2.16. Each of the parties hereto hereby agrees that, upon the effectiveness of any Incremental Amendment, this Agreement and the
other Loan Documents, as applicable, will be amended to the extent necessary to reflect the existence and terms of the Incremental Facility
and the Incremental Loans evidenced thereby. This Section 2.16 shall supersede any provisions in Section 2.15 or 11.01 to the contrary. The
Borrower or the Co-Borrowers may use the proceeds of the Incremental Loans for any purpose not prohibited by this Agreement.
(f)
Conditions. The availability of Incremental Facilities under this Agreement will be subject solely to the following
conditions, subject, for the avoidance of doubt, to Section 1.08, and measured on the date of the receipt of commitments under (assuming
such commitments are fully drawn only on the date of receipt) such Incremental Facility:
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(i)
no Event of Default shall have occurred and be continuing or would result therefrom; provided that the
condition set forth in this clause (i) may be waived or not required (other than with respect to Specified Events of Default) by the
Persons providing such Incremental Facilities if the proceeds of the initial Borrowings under such Incremental Facilities will be
used to finance, in whole or in part, any Permitted Investment or other Acquisition Transaction;
(ii)
the representations and warranties in the Loan Documents will be true and correct in all material respects
(except for representations and warranties that are already qualified by materiality, which representations and warranties will be
true and correct in all respects) immediately prior to, and after giving effect to, the receipt of commitments in respect of such
Incremental Facility; provided that the condition set forth in this clause (ii) may be waived or not required (other than with respect
to (A) the Specified Representations and (B) the representation and warranty contained in Section 5.20) by the Persons providing
such Incremental Facilities if the proceeds of the initial Borrowings under such Incremental Facilities will be used to finance, in
whole or in part, a Permitted Investment; and
(g)
Terms. Each Incremental Amendment will set forth the amount and terms of the relevant Incremental Facility. Each
Incremental Facility will be documented as an increase to the applicable Revolving Commitments and shall be on terms identical to those
applicable to such Revolving Facility except with respect to any commitment, arrangement, upfront or similar fees that may be agreed to
among the Borrower and the lenders providing such Incremental Revolving Facility.
(h)
(i)
[Reserved].
Adjustments to Revolving Loans. Upon each increase in the Revolving Commitments pursuant to this Section 2.16,
unless an Event of Default shall have occurred and be continuing,
(i)
each applicable Revolving Lender immediately prior to such increase will automatically and without further
act be deemed to have assigned to each lender providing a portion of such increase (each an “Incremental Revolving Facility
Lender”), and each such Incremental Revolving Facility Lender will automatically and without further act be deemed to have
assumed and to the extent applicable, a portion of such Revolving Lender’s participations hereunder in outstanding Letters of
Credit, Swing Line Loans and Protective Advances such that, after giving effect to each such deemed assignment and assumption
of participations, the percentage of the aggregate outstanding (1) participations hereunder in Letters of Credit, (2) participations
hereunder in Swing Line Loans and (3) participations hereunder in Protective Advances, in each case held by each applicable
Revolving Lender will equal the percentage of the aggregate Revolving Commitments of all Lenders of the relevant Class
represented by such Revolving Lender’s Revolving Commitments; and
(ii)
if, on the date of such increase, there are any Revolving Loans of the relevant Class outstanding, such
Revolving Loans shall on or prior to the effectiveness of such Incremental Revolving Facility be prepaid from the proceeds of
Incremental Revolving Loans made hereunder (reflecting such increase in Revolving Commitments), which prepayment shall be
accompanied by accrued interest on the Revolving Loans being prepaid and any costs incurred by any Revolving Lender in
accordance with Section 3.05.
Section 2.17
[Reserved]
.
Section 2.18
Extensions of Loans
.
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(a)
Extension Offers. Pursuant to one or more offers (each, an “Extension Offer”) made from time to time by the
Borrower to all Lenders holding Loans and/or Commitments of a particular Class with a like Maturity Date, the Borrower may extend such
Maturity Date and otherwise modify the terms of such Loans and/or Commitments pursuant to the terms set forth in an Extension Offer
(each, an “Extension”). Each Extension Offer will specify the minimum amount of Loans and/or Commitments with respect to which an
Extension Offer may be accepted, which (x) with respect to Loans and/or Commitments denominated in Dollars, will be an integral multiple
of $1,000,000 and an aggregate principal amount that is not less than $5,000,000, (y) with respect to Loans and/or Commitments
denominated in Canadian Dollars, will be an integral multiple of C$1,000,000 and an aggregate principal amount that is not less than
C$5,000,000 or (z) with respect to Loans and/or Commitments denominated in any Alternative Currency (other than Canadian Dollars), will
be an integral multiple of the Dollar Amount of $1,000,000 and an aggregate principal amount that is not less than the Dollar Amount of
$5,000,000 or, in each case, if less, (i) the aggregate principal amount of such Class of Loans outstanding or (ii) such lesser minimum amount
as is approved by the Administrative Agent, such consent not to be unreasonably withheld, conditioned or delayed. Extension Offers will be
made on a pro rata basis to all Lenders holding Loans and/or Commitments of a particular Class with a like Maturity Date. If the aggregate
outstanding principal amount of such Loans (calculated on the face amount thereof) and/or Commitments in respect of which Lenders have
accepted an Extension Offer exceeds the maximum aggregate principal amount of Loans and/or Commitments offered to be extended
pursuant to such Extension Offer, then the Loans and/or Commitments of such Lenders will be extended ratably up to such maximum amount
based on the respective principal amounts (but not to exceed actual holdings of record) with respect to which such Lenders have accepted
such Extension Offer. There is no requirement that any Extension Offer or Extension Amendment (defined as follows) be subject to any
“most favored nation” pricing provisions. The terms of an Extension Offer shall be determined by the Borrower, and Extension Offers may
contain one or more conditions to their effectiveness as determined by the Borrower, including a condition that a minimum amount of Loans
and/or Commitments of any or all applicable tranches be tendered.
(b)
Extension Amendments. The Lenders hereby irrevocably authorize the Administrative Agent to enter into amendments
to this Agreement and the other Loan Documents (an “Extension Amendment”) as may be necessary, advisable or appropriate in order to
establish new tranches in respect of Extended Loans and Extended Revolving Commitments and such amendments as permitted by clause (c)
below as may be necessary, advisable or appropriate in the reasonable opinion of the Borrower, in consultation with the Administrative
Agent, in connection with the establishment of such new tranches of Loans or Commitments. This Section 2.18 shall supersede any
provisions in Section 2.15 or 11.01 to the contrary. Except as otherwise set forth in an Extension Offer, there will be no conditions to the
effectiveness of an Extension Amendment. Extensions will not constitute a voluntary or mandatory payment or prepayment for purposes of
this Agreement.
(c)
Terms of Extension Offers and Extension Amendments. The terms of any Extended Loans and Extended Revolving
Commitments will be set forth in an Extension Offer and as agreed between the Borrower and the Extending Lenders accepting such
Extension Offer; provided that:
(i)
the final maturity date of such Extended Loans and Extended Revolving Commitments will be no earlier than
the Latest Maturity Date applicable to the Loans and/or Commitments subject to such Extension Offer;
(ii)
(iii)
[reserved];
[reserved]; and
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(iv)
except as to (x) maturity, interest, fees (including any commitment, arrangement, upfront or similar fees) and
(y) other terms applicable after the Latest Maturity Date of the Loans that are not Extended Revolving Loans, all terms of any
Extended Revolving Loans or Extended Revolving Commitments shall be on terms and pursuant to documentation applicable to
the Revolving Facility.
Any Extended Loans will constitute a separate tranche of Revolving Loans from the Revolving Loans held by Lenders that did not accept the
applicable Extension Offer.
(d)
Extension of Revolving Commitments. In the case of any Extension of Revolving Commitments and/or Revolving
Loans, the following shall apply:
(i)
all borrowings and all prepayments of Revolving Loans shall continue to be made on a ratable basis among all
Revolving Lenders, based on the relative amounts of their Revolving Commitments, until the repayment of the Revolving Loans
attributable to the non-extended Revolving Commitments on the relevant Maturity Date;
(ii)
the allocation of the participation exposure with respect to any then-existing or subsequently issued or made
Letter of Credit, Swing Line Loan or Protective Advance as between the Revolving Commitments of such extended tranche and
the remaining non-extended Revolving Commitments shall be made on a ratable basis in accordance with the relative amounts
thereof until the Maturity Date relating to such non-extended Revolving Commitments has occurred, it being understood that the
obligations of any Issuing Bank or Swing Line Lender may not be extended beyond the Maturity Date relating to the non-extended
Revolving Commitments pursuant to this Section 2.18 without the consent of such Issuing Bank or Swing Line Lender;
(iii)
no termination of extended Revolving Commitments and no repayment of extended Revolving Loans
accompanied by a corresponding permanent reduction in extended Revolving Commitments shall be permitted unless such
termination or repayment (and corresponding reduction) is accompanied by at least a pro rata termination or permanent repayment
(and corresponding pro rata permanent reduction), as applicable, of each other tranche of Revolving Loans and Revolving
Commitments (or each other tranche of Revolving Commitments and Revolving Loans shall have otherwise been terminated and
repaid in full);
(iv)
at no time shall there be more than five different tranches of Revolving Commitments.
If the Total Utilization of Revolving Commitments exceeds the Line Cap as a result of the occurrence of the Maturity Date with respect to
any tranche of Revolving Commitments while an extended tranche of Revolving Commitments remains outstanding, the Borrower and the
Co-Borrowers shall make such payments as are necessary in order to eliminate such excess on such Maturity Date.
(e)
Required Consents. No consent of any Lender or any other Person will be required to effectuate any Extension, other
than the consent of the Administrative Agent (such consent not to be unreasonably withheld, delayed or conditioned), the Borrower, the Co-
Borrowers and the applicable Extending Lender. The transactions contemplated by this Section 2.18 (including, for the avoidance of doubt,
payment of any interest, fees or premium in respect of any Extended Loans on such terms as may be set forth in the relevant Extension Offer)
will not require the consent of any other Lender or any other Person, and the requirements of any provision of this Agreement or any other
Loan Document that may otherwise prohibit any such Extension or any other transaction contemplated by this Section 2.18 will not apply to
any of the transactions effected pursuant to this Section 2.18.
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Section 2.19
Defaulting Lenders
.
(a)
Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender
becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable
Law:
(i)
Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the
Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to
Article IX or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 11.09 shall be
applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts
owing by such Defaulting Lender to the Administrative Agent hereunder; second, to the payment on a pro rata basis of any
amounts owing by such Defaulting Lender to each Issuing Bank and the Swing Line Lender hereunder; third, to Cash Collateralize
each Issuing Bank’s Fronting Exposure with respect to such Defaulting Lender with respect to outstanding Letters of Credit (in an
amount equal to 103% of the maximum face amount of all outstanding Letters of Credit) or the Swing Line Lender’s Fronting
Exposure with respect to such Defaulting Lender in accordance with Section 2.19(d); fourth, as the Borrower may request (so long
as no Event of Default shall have occurred and be continuing), to the funding of any Loan in respect of which such Defaulting
Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; fifth, if so
determined by the Administrative Agent and the Borrower, to be held in a Cash Collateral Account and released pro rata in order
to (A) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement and (B)
Cash Collateralize each Issuing Bank’s (in an amount equal to 103% of the maximum face amount of all outstanding Letters of
Credit) or the Swing Line Lender’s future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters
of Credit or Swing Line Loans, as applicable, issued under this Agreement, in accordance with Section 2.19(d); sixth, to the
payment of any amounts owing to the Lenders, the Issuing Banks or the Swing Line Lender as a result of any judgment of a court
of competent jurisdiction obtained by any Lender, any Issuing Bank or the Swing Line Lender against such Defaulting Lender as a
result of such Defaulting Lender’s breach of its obligations under this Agreement; seventh, so long as no Event of Default shall
have occurred and be continuing, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of
competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of
its obligations under this Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent
jurisdiction; provided that if (1) such payment is a payment of the principal amount of any Loans or Reimbursement Obligations in
respect of which such Defaulting Lender has not fully funded its appropriate share, and (2) such Loans were made or the related
Letters of Credit were issued at a time when the conditions set forth in Article IV were satisfied or waived, such payment shall be
applied solely to pay the Loans of, and Reimbursement Obligations owed to, all Non-Defaulting Lenders on a pro rata basis prior
to being applied to the payment of any Loans of, or Reimbursement Obligations owed to, such Defaulting Lender until such time
as all Loans and funded and unfunded participations in Letters of Credit, Swing Line Loans and Protective Advances are held by
the Lenders pro rata in accordance with the applicable Commitments without giving effect to Section 2.19(a)(iii). Any payments,
prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a
Defaulting Lender or to post Cash Collateral pursuant to this Section 2.19(a)(i) shall be deemed paid to and redirected by such
Defaulting Lender, and each Lender irrevocably consents hereto.
(ii)
Certain Fees.
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(A)
No Defaulting Lender shall be entitled to receive any fee pursuant to Section 2.11(b) for any
period during which that Lender is a Defaulting Lender; provided such Defaulting Lender shall be entitled to receive
fees pursuant to Section 2.11(b)(ii) for any period during which that Lender is a Defaulting Lender only to the extent
allocable to its Pro Rata Share of the Stated Amount of Letters of Credit for which it has provided Cash Collateral
pursuant to Section 2.04.
(B)
With respect to any fees not required to be paid to any Defaulting Lender pursuant to clause (A)
above, the Borrower shall (1) pay to each Non-Defaulting Lender that portion of any such fee otherwise payable to such
Defaulting Lender with respect to such Defaulting Lender’s participation in Letters of Credit, Swing Line Loans and
Protective Advances that has been reallocated to such Non-Defaulting Lender pursuant to clause (iii) below, (2) pay to
each Issuing Bank the amount of any such fee otherwise payable to such Defaulting Lender to the extent allocable to
such Issuing Bank’s Fronting Exposure to such Defaulting Lender, and (3) not be required to pay the remaining amount
of any such fee.
(iii)
Reallocation of Participations to Reduce Fronting Exposure. All or any part of such Defaulting Lender’s
participation in Letters of Credit, Swing Line Loans and Protective Advances shall be reallocated among the Non-Defaulting
Lenders in accordance with their respective Pro Rata Shares (calculated without regard to such Defaulting Lender’s Commitment)
but only to the extent that (A) the conditions set forth in Section 4.02 are satisfied at the time of such reallocation (and, unless the
Borrower shall have otherwise notified the Administrative Agent at such time, the Borrower shall be deemed to have represented
and warranted that such conditions are satisfied at such time), and (B) such reallocation does not cause the aggregate Revolving
Exposure of any Non-Defaulting Lender to exceed such Non-Defaulting Lender’s Revolving Commitment. Subject to Section
11.25, no reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting
Lender arising from that Lender having become a Defaulting Lender, including any claim of a Non-Defaulting Lender as a result
of such Non-Defaulting Lender’s increased exposure following such reallocation.
(iv)
Cash Collateral. If the reallocation described in clause (iii) above cannot, or can only partially, be effected,
the Borrower shall, without prejudice to any right or remedy available to it hereunder or under law, provide Cash Collateral
pursuant to the requirements set forth in Section 2.19(d).
(b)
Defaulting Lender Cure. If the Borrower, the Administrative Agent and the Swing Line Lender and each Issuing Bank
agree in writing that a Lender is no longer a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of
the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any
Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such
other actions as the Administrative Agent may determine to be necessary to cause the Loans and funded and unfunded participations in
Letters of Credit, Swing Line Loans and Protective Advances to be held pro rata by the Lenders in accordance with the applicable
Commitments (without giving effect to Section 2.04) whereupon such Lender will cease to be a Defaulting Lender; provided that no
adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was
a Defaulting Lender; provided further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from
Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender having been a
Defaulting Lender.
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(c)
New Swing Line Loans/Letters of Credit. So long as any Tranche 1 Revolving Lender is a Defaulting Lender, (i) the
Swing Line Lender shall not be required to fund any Swing Line Loans unless it is satisfied that it will have no Fronting Exposure after
giving effect to such Swing Line Loan and (ii) no Issuing Bank shall be required to issue, extend or amend any Letter of Credit unless it is
satisfied that it will have no Fronting Exposure after giving effect thereto.
(d)
Cash Collateral. At any time that there shall exist a Defaulting Lender and Section 2.19(a)(iv) is applicable, within one
Business Day following the written request of the Administrative Agent, any Issuing Bank (with a copy to the Administrative Agent) or the
Swing Line Lender (with a copy to the Administrative Agent), the Borrower shall Cash Collateralize the applicable Issuing Bank’s Fronting
Exposure, the Swing Line Lender’s Fronting Exposure and any outstanding Protective Advance, as the case may be, with respect to such
Defaulting Lender (determined after giving effect to Section 2.04 and any Cash Collateral provided by such Defaulting Lender) in an amount
not less than the Minimum Collateral Amount.
(i)
Grant of Security Interest. The Borrower, and to the extent provided by any Defaulting Lender, such
Defaulting Lender, hereby grants to the Administrative Agent, for the benefit of the Issuing Banks and the Lenders (including the
Swing Line Lender), and agrees to maintain, a first priority security interest in all such Cash Collateral as security for the
Defaulting Lender’s obligation to fund participations in respect of Letters of Credit, Swing Line Loans and Protective Advances,
to be applied pursuant to clause (ii) below. If at any time the Administrative Agent determines that the Cash Collateral is subject
to any right or claim of any Person other than the Administrative Agent, the Issuing Banks or the Lenders as herein provided, or
that the total amount of such Cash Collateral is less than the Minimum Collateral Amount, the Borrower will, promptly upon
demand by the Administrative Agent, pay or provide to the Administrative Agent additional Cash Collateral in an amount
sufficient to eliminate such deficiency (after giving effect to any Cash Collateral provided by the Defaulting Lender).
(ii)
Application. Notwithstanding anything to the contrary contained in this Agreement, (A) Cash Collateral
provided under this Section 2.19 in respect of Letters of Credit shall be applied to the satisfaction of the Defaulting Lender’s
obligation to fund participations in respect of Letters of Credit (including, as to Cash Collateral provided by a Defaulting Lender,
any interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other application of such
property as may otherwise be provided for herein, (B) Cash Collateral provided under this Section 2.19 in respect of Swing Line
Loans shall be applied to the satisfaction of the Defaulting Lender’s obligations to fund participations in respect of Swing Line
Loans (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) for which the
Cash Collateral was so provided, prior to any other application of such property as may otherwise be provided for herein and (C)
Cash Collateral provided under this Section 2.19 in respect of Protective Advances shall be applied to the satisfaction of the
Defaulting Lender’s obligations to fund participations in respect of Protective Advances (including, as to Cash Collateral provided
by a Defaulting Lender, any interest accrued on such obligation) for which the Cash Collateral was so provided, prior to any other
application of such property as may otherwise be provided for herein.
(iii)
Termination of Requirement. Cash Collateral (or the appropriate portion thereof) provided to reduce any
Issuing Bank’s or the Swing Line Lender’s Fronting Exposure or applied to any such Defaulting Lender’s obligations to fund
participations in respect of Protective Advances shall no longer be required to be held as Cash Collateral pursuant to this Section
2.19 following (A) the elimination of the applicable Fronting Exposure (including by the termination of Defaulting Lender status
of the applicable Lender), (B) (I) the repayment in full of all Protective Advances by
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the Borrower or (II) the payment by such Defaulting Lender of its obligations to fund participations in respect of Protective
Advances (including at the time of the termination of Defaulting Lender status of the applicable Lender) or (C) the determination
by the Administrative Agent, the applicable Issuing Bank or the Swing Line Lender, as the case may be, that there exists excess
Cash Collateral; provided that, subject to the other provisions of this Section 2.19, the Person providing Cash Collateral and the
applicable Issuing Bank, the Swing Line Lender or, with respect to Protective Advances, the Administrative Agent, as the case
may be, may agree that the Cash Collateral shall be held to support future anticipated Fronting Exposure or other obligations
(including obligations to fund Protective Advances); provided further that to the extent that such Cash Collateral was provided by
the Borrower, such Cash Collateral shall remain subject to the security interest granted pursuant to the Loan Documents.
(e)
Hedge Banks. So long as any Lender is a Defaulting Lender, such Lender shall not be a Hedge Bank with respect to
any Secured Hedge Agreement entered into while such Lender was a Defaulting Lender.
Section 2.20
[Reserved]
.
Section 2.21
Judgment Currency
.
(a)
If, for the purpose of obtaining judgment in any court, it is necessary to convert a sum owing hereunder or under any
other Loan Document in one currency into another currency, each party hereto and each Loan Party (and by its acceptance of its appointment
in such capacity, each Lead Arranger) agrees, to the fullest extent that it may effectively do so, that the rate of exchange used shall be that at
which, in accordance with normal banking procedures in the relevant jurisdiction, the first currency could be purchased with such other
currency on the Business Day immediately preceding the day on which final judgment is given.
(b)
The obligations of the Loan Parties in respect of any sum due to any party hereto or under any other Loan Document or
any holder of the obligations owing hereunder or under any other Loan Document (the “Applicable Creditor”) shall, notwithstanding any
judgment in a currency (the “Judgment Currency”) other than the currency in which such sum is stated to be due hereunder (the
“Agreement Currency”), be discharged only to the extent that, on the Business Day following receipt by the Applicable Creditor of any sum
adjudged to be so due in the Judgment Currency, the Applicable Creditor may in accordance with normal banking procedures in the relevant
jurisdiction purchase the Agreement Currency with the Judgment Currency; if the amount of the Agreement Currency so purchased is less
than the sum originally due to the Applicable Creditor in the Agreement Currency, the Borrower and each other Loan Party, as a separate
obligation and notwithstanding any such judgment, agrees to indemnify the Applicable Creditor against such loss. The obligations of the
Loan Parties contained in this Section shall survive the termination of this Agreement and the payment of all other amounts owing hereunder.
Section 2.22
Reserves; Changes to Eligibility Criteria
The Administrative Agent may at any time and from time to time and only in the exercise of its Permitted Discretion establish new
categories of Reserves or change eligibility criteria set forth in the definition of “Eligible Accounts Receivable,” “Eligible Credit Insured
Accounts” and/or “Eligible Inventory” upon five Business Days’ prior written notice to the Borrower (which notice shall not be required at
any time an Event of Default has occurred and is continuing), which notice shall include a reasonably detailed description of such new
category of Reserve being established or change to any eligibility criteria set forth in the definition of “Eligible Accounts Receivable,”
“Eligible Credit Insured Accounts” and/or “Eligible Inventory” (during which five Business Day period (x) the Administrative Agent shall, if
121
requested, discuss any such Reserve or change with the Borrower and (y) the Borrower may take such action as may be required so that the
event, condition or matter that is the basis for such Reserve or change thereto no longer exists or exists in a manner that would result in the
establishment of a lower Reserve or result in a lesser change thereto, in a manner and to the extent reasonably satisfactory to the
Administrative Agent), establish and increase or decrease Reserves in accordance with the terms hereof; provided that, pending the expiration
of such five Business Day period, no Borrowings may be made if such Borrowings would result in the Total Utilization of Revolving
Commitments to exceed the Line Cap, calculated as if such proposed Reserve had been implemented. Notwithstanding any other provision
of this Agreement to the contrary, (a) the establishment or increase of any Reserves or changes in any eligibility criteria shall be limited to
such Reserves and changes as the Administrative Agent determines, in its Permitted Discretion, are appropriate based on the analysis of facts
or events first occurring or first discovered by the Administrative Agent after the Closing Date or that differ materially from facts or events
occurring and known to the Administrative Agent on the Closing Date, (b) in no event shall Reserves or changes in eligibility criteria with
respect to any component of the Borrowing Base duplicate any other Reserves currently established or maintained or eligibility criteria to the
extent addressed thereby, (c) the amount of any such Reserve or change in eligibility criteria shall be a reasonable quantification of the
incremental dilution of the Borrowing Base attributable to the relevant contributing factors and have a reasonable relationship to the event,
condition or other matter that is the basis for such Reserve or change and (d) in no event shall Reserves to reflect the dilution of Eligible
Accounts Receivable be imposed until dilution of Accounts exceeds 5.0% of the gross face amount of such Accounts, in which case a
Reserve shall be established in an amount equal to 1.0% of the value of Accounts for each percentage point (or portion thereof) of dilution in
excess 5.0%.
Section 2.23
Currency Equivalents
(a)
The Administrative Agent shall determine the Dollar Amount of each Loan denominated in an Alternative Currency
and Letter of Credit Obligation in respect of Letters of Credit denominated in an Alternative Currency (i) for Loans, as of the first day of each
Interest Period applicable thereof, and (ii) for Letters of Credit, as of the end of each fiscal quarter of the Borrower, and in each case shall
promptly notify the Borrower of each Dollar Amount so determined by it. Each such calculation shall bas on the basis of the Spot Rate (as
defined below) for the purchase of such currency with Dollars. For purposes of this Section 2.23, the “Spot Rate” for a currency means the
rate determined by the Administrative Agent to be the rate quoted by the Person acting in such capacity as the spot rate for the purchase by
such Person of such currency with another currency through its principal foreign exchange trading office at approximately 11:00 a.m. on the
date two Business Days prior to the date of such determination; provided that the Administrative Agent may obtain such spot rate from
another financial institution designated by the Administrative Agent if the Person acting in such capacity does not have as of the date of
determination a spot buying rate for any such currency.
(b)
If after giving effect to any such determination of a Dollar Amount, the sum of the aggregate outstanding amount of the
Tranche 1 Revolving Loans denominated in Alternative Currencies and the Letter of Credit Obligations denominated in Alternative
Currencies exceeds the aggregate Dollar Amount of Tranche 1 Revolving Commitments then in effect, the Borrower shall, within five
Business Days of receipt of notice thereof from the Administrative Agent setting forth such calculation in reasonable detail, prepay the
applicable Tranche 1 Revolving Loans denominated in Alternative Currencies under the Tranche 1 Revolving Facility or take other action as
the Administrative Agent, in its discretion, may direct (including to Cash Collateralize the applicable Letter of Credit Obligations) to the
extent necessary to eliminate any such excess.
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TAXES, INCREASED COSTS PROTECTION AND ILLEGALITY
ARTICLE III.
Section 3.01
Taxes
.
(a)
Except as required by applicable Law, any and all payments by the Borrower or any Guarantor to or for the account of
any Agent, Lender or Issuing Bank under any Loan Document shall be made free and clear of and without deduction for any and all present
or future taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or similar charges imposed by any Governmental
Authority, and all liabilities (including additions to tax, penalties and interest) with respect thereto (“Taxes”). The following shall be
“Excluded Taxes”: in the case of each Agent, each Lender and Issuing Bank, (i) Taxes imposed on or measured by net income (however
denominated, and including branch profits and similar Taxes), and franchise or similar Taxes, in each case, that are (A) imposed by the
jurisdiction (or political subdivision thereof) under the laws of which it is organized or in which its principal office is located or, in the case
of any Lender, in which its applicable Lending Office is located, or (B) Other Connection Taxes; (ii) any U.S. federal Tax that is (or would
be) required to be withheld with respect to amounts payable hereunder in respect of an Eligible Assignee (pursuant to an assignment under
Section 10.07) on the date it becomes an assignee to the extent such Tax is in excess of the Tax that would have been applicable had such
assigning Lender not assigned its interest arising under any Loan Document (unless such assignment is at the express written request of the
Borrower); (iii) U.S. federal withholding Taxes imposed on amounts payable to or for the account of a Lender, Agent or Issuing Bank with
respect to an applicable interest in a Loan or Commitment pursuant to a Law in effect on the date on which (A) such Lender, Agent or Issuing
Bank acquires such interest in the applicable Commitment or, to the extent a Lender acquires an interest in a Loan not funded pursuant to a
prior Commitment, acquires such interest in such Loan (other than pursuant to an assignment request by the Borrower under Section 3.07) or
(B) such Lender, changes its Lending Office (other than at the written request of the Borrower to change such Lending Office), except in each
case to the extent that pursuant to Section 3.01, amounts with respect to such Taxes were payable to such Lender’s, Agent’s or Issuing Bank’s
assignor immediately before such Lender, Agent or Issuing Bank became a party hereto, or to such Lender immediately before it changed its
Lending Office; any Taxes imposed as a result of the failure of any Agent, Lender or Issuing Bank to comply with the provisions of Sections
3.01(b), 3.01(c) and 3.01(d) (in the case of any Foreign Lender, as defined below) or the provisions of Section 3.01(e) (in the case of any U.S.
Lender, as defined below), (v) any Taxes imposed as a result of any Lender or any other recipient of such payment (A) not dealing at arm’s
length (within the meaning of the Canadian Tax Act) with any Loan Party, or (B) being at any time a “specified non-resident shareholder”
(within the meaning of subsection 18(5) of the Canadian Tax Act) of any Loan Party or at any time not dealing at arm’s length (within the
meaning of the Canadian Tax Act) with a “specified shareholder” (within the meaning of subsection 18(5) of the Canadian Tax Act) of any
Loan Party (other than, in each of cases (A) and (B), where such non-arm’s length, “specified shareholder,” or “specified non-resident
shareholder” relationship arises from the Lender or recipient having executed, delivered, become a party to, performed its obligations under,
received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan
Document, or sold or assigned an interest in any Loan or Loan Document) and (vi) any Taxes imposed on any amount payable to or for the
account of any Agent, Lender or Issuing Bank as a result of the failure of such recipient to satisfy the applicable requirements under FATCA
to establish that such payment is exempt from withholding under FATCA. If an applicable Withholding Agent is required to deduct any
Taxes or Other Taxes (as defined below) from or in respect of any sum payable under any Loan Document to any Agent, Lender or Issuing
Bank, (A) except in the case of Excluded Taxes, the sum payable shall be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this Section 3.01(a)), each of such Agent, Lender or Issuing Bank receives
an amount equal to the sum it would have received had no such deductions been made, (B) the applicable Withholding Agent shall make
such deductions, (C) the applicable Withholding Agent shall pay the full amount deducted to the relevant taxing
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authority, and (D) within thirty days after the date of any such payment by the Borrower or any Guarantor (or, if receipts or evidence are not
available within thirty days, as soon as practicable thereafter), the Borrower or applicable Guarantor shall furnish to such Agent, Lender or
Issuing Bank (as the case may be) the original or a facsimile copy of a receipt evidencing payment thereof to the extent such a receipt has
been made available to the Borrower or applicable Guarantor (or other evidence of payment reasonably satisfactory to the Administrative
Agent). If the Borrower or applicable Guarantor fails to pay any Taxes or Other Taxes when due to the appropriate taxing authority, the
Borrower or applicable Guarantor shall indemnify such Agent, such Lender and such Issuing Bank for any incremental Taxes that may
become payable by such Agent, such Lender or such Issuing Bank arising out of such failure.
(b)
To the extent it is legally able to do so, each Agent, Lender or Issuing Bank (including an Eligible Assignee to which a
Lender assigns its interest in accordance with Section 11.07, unless such Eligible Assignee is already a Lender hereunder) that is not a
“United States person” within the meaning of Section 7701(a)(30) of the Code (each, a “Foreign Lender”) agrees to complete and deliver to
the Borrower and the Administrative Agent on or prior to the date on which the Foreign Lender becomes a party hereto (and from time to
time thereafter upon the reasonable request of the Borrower or the Administrative Agent), two (2) accurate, complete and signed copies of
whichever of the following is applicable: (i) IRS Form W-8BEN or Form W-8BEN-E certifying that it is entitled to benefits under an income
tax treaty to which the United States is a party; (ii) IRS Form W-8ECI certifying that the income receivable pursuant to any Loan Document
is effectively connected with the conduct of a trade or business in the United States; (iii) if the Foreign Lender is not (A) a bank described in
Section 881(c)(3)(A) of the Code, (B) a 10-percent shareholder of the Borrower described in Section 871(h)(3)(B) of the Code, or (C) a
controlled foreign corporation related to the Borrower within the meaning of Section 864(d)(4) of the Code, a certificate to that effect in
substantially the form attached hereto as Exhibit G (a “Non-Bank Certificate”) and an IRS Form W-8BEN or Form W-8BEN-E, certifying
that the Foreign Lender is not a United States person; or (iv) to the extent a Foreign Lender is not the beneficial owner for U.S. federal
income tax purposes, an IRS Form W-8IMY (or any successor forms) of the Foreign Lender, accompanied by, as and to the extent applicable,
an IRS Form W-8BEN, Form W-8BEN-E, Form W-8ECI, Non-Bank Certificate, Form W-9, Form W-8IMY (or other successor forms) and
any other required supporting information from each beneficial owner (it being understood that a Foreign Lender need not provide
certificates or supporting documentation from beneficial owners if (A) the Foreign Lender is a “qualified intermediary” or “withholding
foreign partnership” for U.S. federal income tax purposes and (B) such Foreign Lender is as a result able to establish, and does establish, that
payments to such Foreign Lender are, to the extent applicable, entitled to an exemption from or, if an exemption is not available, a reduction
in the rate of, U.S. federal withholding Taxes without providing such certificates or supporting documentation); or (v) any other form
prescribed by applicable requirements of U.S. federal income tax law as a basis for claiming exemption from or a reduction in U.S. federal
withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable requirements of law
to permit the Borrower and the Administrative Agent to determine the withholding or deduction required to be made.
(c)
In addition, each such Foreign Lender shall, to the extent it is legally entitled to do so, (i) promptly submit to the
Borrower and the Administrative Agent two (2) accurate, complete and signed copies of such other or additional forms or certificates (or
such successor forms or certificates as shall be adopted from time to time by the relevant taxing authorities) as may then be applicable or
available to secure an exemption from or reduction in the rate of U.S. federal withholding Tax (1) on or before the date that such Foreign
Lender’s most recently delivered form, certificate or other evidence expires or becomes obsolete or inaccurate in any material respect,
(2) after the occurrence of a change in the Foreign Lender’s circumstances requiring a change in the most recent form, certificate or evidence
previously delivered by it to the Borrower and the Administrative Agent, and (3) from time to time thereafter if reasonably requested by the
Borrower or the Administrative Agent, and (ii) promptly notify the Borrower and the Administrative
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Agent of any change in the Foreign Lender’s circumstances that would modify or render invalid any claimed exemption or reduction. This
Section 3.01(c) shall not apply to any reporting requirements under FATCA.
(d)
If a payment made to a Lender under any Loan Document would be subject to Tax imposed by FATCA if such Lender
were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the
Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by Law and at
such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable Law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower
or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under
FATCA and to determine whether such Foreign Lender has complied with such Foreign Lender’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment. Solely for purposes of this Section 3.01(d), “FATCA” shall include any amendments
made to FATCA after the date of this Agreement.
(e)
Each Agent, Lender or Issuing Bank that is a “United States person” (within the meaning of Section 7701(a)(30) of the
Code) (each, a “U.S. Lender”) agrees to complete and deliver to the Borrower and the Administrative Agent two (2) copies of accurate,
complete and signed IRS Form W-9 or successor form certifying that such U.S. Lender is not subject to U.S. federal backup withholding Tax
(i) on or prior to the Closing Date (or on or prior to the date it becomes a party to this Agreement), (ii) on or before the date that such form
expires or becomes obsolete or inaccurate in any material respect, (iii) after the occurrence of a change in the U.S. Lender’s circumstances
requiring a change in the most recent form previously delivered by it to the Borrower and the Administrative Agent, and (iv) from time to
time thereafter if reasonably requested by the Borrower or the Administrative Agent.
(f)
The Borrower (on behalf of all Co-Borrowers) agrees to pay any and all present or future stamp, court or documentary
Taxes and any other excise (in the nature of a documentary or similar Tax), property, intangible, filing or mortgage recording Taxes or
charges or similar levies imposed by any Governmental Authority that arise from any payment made under any Loan Document or from the
execution, delivery, performance, enforcement or registration of, or otherwise with respect to, any Loan Document (including additions to
Tax, penalties and interest related thereto) excluding, in each case, such amounts that are Other Connection Taxes imposed in connection with
an Assignment and Assumption, grant of a participation, transfer or assignment to or designation of a new applicable Lending Office or other
office for receiving payments under any Loan Document, except to the extent that any such change is requested in writing by the Borrower
(all such non-excluded Taxes described in this Section 3.01(f) being hereinafter referred to as “Other Taxes”).
(g)
If any Taxes or Other Taxes are directly asserted against any Agent, Lender or Issuing Bank with respect to any
payment received by such Agent or Lender in respect of any Loan Document, such Agent, Lender or Issuing Bank may pay such Taxes or
Other Taxes and the Borrower will promptly indemnify and hold harmless such Agent, Lender or Issuing Bank for the full amount of such
Taxes (other than Excluded Taxes) and Other Taxes (and any Taxes (other than Excluded Taxes) and Other Taxes imposed on amounts
payable under this Section 3.01), and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes or Other
Taxes were correctly or legally imposed or asserted. Payments under this Section 3.01(g) shall be made within ten days after the date the
Borrower receives written demand for payment from such Agent, Lender or Issuing Bank.
(h)
Except as provided in Section 11.07(e), a Participant shall not be entitled to receive any greater payment under this
Section 3.01 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant.
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(i)
If any Agent, Lender or Issuing Bank determines, in its sole discretion, exercised in good faith, that it has received a
refund in respect of any Taxes or Other Taxes as to which it has been indemnified by the Borrower or any Guarantor, as the case may be, or
with respect to which the Borrower or any Guarantor, as the case may be, has paid additional amounts pursuant to this Section 3.01, it shall
promptly pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made, or additional
amounts paid, by the Borrower or any Guarantor under this Section 3.01 with respect to the Taxes or Other Taxes giving rise to such refund),
net of all reasonable out-of-pocket expenses incurred by such Agent, such Lender or Issuing Bank and without interest (other than any
interest paid by the relevant Governmental Authority with respect to such refund), provided that the Borrower or applicable Guarantor, as the
case may be, upon the request of such Agent, such Lender or Issuing Bank, agrees to repay the amount paid over to the Borrower or
applicable Guarantor, as the case may be (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to
such Agent, such Lender or Issuing Bank in the event such Agent, such Lender or Issuing Bank is required to repay such refund to such
Governmental Authority. Notwithstanding anything to the contrary in this paragraph (i), in no event will such Agent, Lender or Issuing Bank
be required to pay any amount to the Borrower or applicable Guarantor pursuant to this paragraph (i) the payment of which would place such
Agent, Lender or Issuing Bank in a less favorable net after-Tax position than the indemnified party would have been in if the Tax or Other
Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification
payments or additional amounts with respect to such Tax or Other Tax had never been paid. Such Agent, such Lender or Issuing Bank, as the
case may be, shall provide the Borrower upon request with a copy of any notice of assessment or other evidence reasonably available of the
requirement to repay such refund received from the relevant Governmental Authority (provided that such Lender, such Agent or Issuing
Bank may delete any information therein that such Lender, such Agent or Issuing Bank deems confidential or not relevant to such refund in
its reasonable discretion). This subsection shall not be construed to require any Agent, Lender or Issuing Bank to make available its tax
returns (or any other information relating to its Taxes that it reasonably deems confidential) to the Borrower, any Guarantor or any other
Person.
(j)
Each Lender agrees that, upon the occurrence of any event giving rise to the operation of Section 3.01(a) or (g) with
respect to such Lender, it will, if requested by the Borrower in writing, use commercially reasonable efforts (subject to legal and regulatory
restrictions) to mitigate the effect of any such event, including by designating another Lending Office for any Loan affected by such event
and by completing and delivering or filing any Tax-related forms that such Lender is legally able to deliver and that would reduce or
eliminate any amount of Taxes or Other Taxes required to be deducted or withheld or paid by the Borrower; provided that such efforts are
made at the Borrower’s expense and are on terms that, in the reasonable judgment of such Lender, do not cause such Lender or any of its
Lending Offices to suffer any economic, legal or regulatory disadvantage, and provided further that nothing in this Section 3.01(j) shall affect
or postpone any of the Obligations of the Borrower or the rights of such Lender pursuant to Section 3.01(a) or (g).
(k)
Notwithstanding any other provision of this Agreement, the Borrower and the Administrative Agent may deduct and
withhold any Taxes required by any Laws (including, for the avoidance of doubt, FATCA) to be deducted and withheld from any payment
under any of the Loan Documents, subject to the provisions of this Section 3.01.
(l)
Each Agent or Lender, as applicable, shall severally indemnify the Administrative Agent, within ten days after demand
therefor, for (i) any Taxes attributable to such Agent or Lender (but only to the extent that the Borrower has not already indemnified the
Administrative Agent for such Taxes and without limiting the obligation of the Borrower to do so), (ii) any Taxes attributable to such
Lender’s failure to comply with the provisions of Section 11.07(e) relating to the maintenance of a Participant Register and (iii) any Excluded
Taxes attributable to such Agent or Lender, in each case, that are payable or paid by the
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Administrative Agent in connection with any Loan Document, and any reasonable expenses arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the
amount of such payment or liability delivered to any Agent or Lender by the Administrative Agent shall be conclusive absent manifest
error. Each Agent and Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such
Agent or Lender under any Loan Document or otherwise payable by the Administrative Agent to such Agent or Lender from any other
source against any amount due to the Administrative Agent under this Section 3.01(l).
(m)
Each Lender authorizes the Administrative Agent to deliver to the Borrower and to any successor Administrative
Agent any documentation provided by the Lender to the Administrative Agent pursuant to paragraph (b), (c), (d), or (e) of this Section 3.01.
(n)
The agreements in this Section 3.01 shall survive the resignation or replacement of the Administrative Agent,
termination of this Agreement and the payment of the Loans and all other amounts payable hereunder and any assignment of rights by, or
replacement of, any Lender.
Section 3.02
Illegality
. If any Lender reasonably determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it
is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Loans whose interest is determined by reference to the
Eurocurrency Rate, or to determine or charge interest rates based upon the Eurocurrency Rate, or any Governmental Authority has imposed
material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars, Canadian Dollars or any Alternative
Currency in the London interbank market, the Canadian bankers’ acceptances market or any other applicable offshore interbank market, as
applicable, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, (i) with respect to any Loans
denominated in Dollars or Canadian Dollars, any obligation of such Lender to make or continue Eurocurrency Rate Loans or to convert Base
Rate Loans to Eurocurrency Rate Loans, shall be suspended, and (ii) if such notice asserts the illegality of such Lender making or
maintaining Base Rate Loans the interest rate on which is determined by reference to the Adjusted Eurocurrency Rate component of the Base
Rate, the interest rate on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by the
Administrative Agent without reference to the Adjusted Eurocurrency Rate component of the Base Rate, in each case until such Lender
notifies the Administrative Agent and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of
such notice, (A) with respect to Borrowings denominated in Dollars or Canadian Dollars, the Borrower may revoke any pending request for a
Borrowing of, conversion to or continuation of Eurocurrency Rate Loans and shall, upon demand from such Lender (with a copy to the
Administrative Agent), prepay or, if applicable, convert all Eurocurrency Rate Loans of such Lender to Base Rate Loans (the interest rate on
which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without
reference to the Adjusted Eurocurrency Rate component of the Base Rate), either on the last day of the Interest Period therefor, if such
Lender may lawfully continue to maintain such Eurocurrency Rate Loans to such day, or immediately, if such Lender may not lawfully
continue to maintain such Eurocurrency Rate Loans and (B) with respect to Borrowings denominated in an Alternative Currency (other than
Canadian Dollars), the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of such Eurocurrency
Rate Loans and shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable, convert all
Eurocurrency Rate Loans of such Lender to a Loan bearing interest at an alternative rate mutually acceptable to the Borrower and the
applicable Lenders, either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such Eurocurrency
Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurocurrency Rate Loans; provided,
however, that if the Borrower and the applicable Lenders cannot agree within a reasonable time on an alternative rate for such Loans, the
Borrower may, at its discretion, either (x) prepay such Loans or (y) maintain such Loans outstanding, in
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which case, the interest rate payable to the applicable Lender on such Loans will be the rate determined by the Administrative Agent as its
cost of funds to fund a Borrowing of such Loans with maturities comparable to the Interest Period applicable thereto plus the Applicable Rate
or (C) if such notice asserts the illegality of such Lender determining or charging interest rates based upon the Adjusted Eurocurrency Rate
component of the Base Rate with respect to any Base Rate Loans, the Administrative Agent shall during the period of such suspension
compute the Base Rate applicable to such Lender without reference to the Adjusted Eurocurrency Rate component thereof until the
Administrative Agent is advised in writing by such Lender that it is no longer illegal for such Lender to determine or charge interest rates
based upon the Eurocurrency Rate. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on the amount so
prepaid or converted.
Section 3.03
Inability to Determine Rates
. If the Administrative Agent or the Required Lenders reasonably determine that for any reason in connection with any request for
a Eurocurrency Rate Loan or a conversion to or continuation thereof that (a) deposits are not being offered to banks in the London or
Canadian interbank eurodollar market for the applicable amount and Interest Period of such Eurocurrency Rate Loan, (b) adequate and
reasonable means do not exist for determining the Adjusted Eurocurrency Rate for any requested Interest Period with respect to a proposed
Eurocurrency Rate Loan or in connection with an existing or proposed Base Rate Loan (in each case with respect to clauses (a) and (b),
“Impacted Loans”) or (c) the Eurocurrency Rate for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan does
not adequately and fairly reflect the cost to such Lenders of funding such Loan, the Administrative Agent will promptly so notify the
Borrower and each Lender. Thereafter, (i) the obligation of the Lenders to make or maintain such Eurocurrency Rate Loans shall be
suspended, and (ii) in the event of a determination described in the preceding sentence with respect to the Adjusted Eurocurrency Rate
component of the Base Rate, the utilization of the Adjusted Eurocurrency Rate component in determining the Base Rate shall be suspended,
in each case until the Administrative Agent (upon the instruction of the Required Lenders) revokes such notice. Upon receipt of such notice,
(i) with respect to Borrowings denominated in Dollars or Canadian Dollars, the Borrower may revoke any pending request for a Borrowing
of, conversion to or continuation of Eurocurrency Rate Loans or, failing that, will be deemed to have converted such request into a request
for a Borrowing of Base Rate Loans in the amount specified therein or (ii) with respect to Borrowings denominated in an Alternative
Currency (other than Canadian Dollars), the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of
Eurocurrency Rate Loans and shall convert all such Eurocurrency Rate Loans of such Lender to a Loan bearing interest at an alternative rate
mutually acceptable to the Borrower and the applicable Lenders; provided however, that if the Borrower and the applicable Lenders cannot
agree within a reasonable time on an alternative rate for such Loans, the Borrower may, at its discretion, either (A) prepay such Loans or (B)
maintain such Loans outstanding, in which case, the interest rate payable to the applicable Lender on such Loans will be the rate determined
by the Administrative Agent as its cost of funds to fund a Borrowing of such Loans with maturities comparable to the Interest Period
applicable thereto plus the Applicable Rate.
Notwithstanding the foregoing, if the Administrative Agent has made the determination described in clause (a) or (b) of the
foregoing paragraph, the Administrative Agent, in consultation with the Borrower, may establish an alternative interest rate for such Loans,
in which case, such alternative rate of interest shall apply with respect to such Loans until (i) the Administrative Agent revokes the notice
delivered with respect to such Loans under clause (a) or (b) of the first sentence of the foregoing paragraph, (ii) the Administrative Agent or
the Required Lenders notify the Administrative Agent and the Borrower that such alternative interest rate does not adequately and fairly
reflect the cost to such Lenders of funding the Impacted Loans, or (iii) any Lender determines that any law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for such Lender or its applicable Lending Office to make, maintain or fund Loans
whose interest is determined by reference to such alternative rate of interest or to determine or charge interest rates based upon such rate or
any Governmental Authority has imposed material restrictions on the
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authority of such Lender to do any of the foregoing and provides the Administrative Agent and the Borrower written notice thereof. The
Administrative Agent will promptly (in one or more notices) notify the Borrower and each Lender of the establishment of an alternative
interest rate pursuant to clause (a) of the foregoing paragraph.
Section 3.04
Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurocurrency Rate Loans
.
(a)
Increased Costs Generally. If any Change in Law shall:
(i)
impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar
requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender, any Issuing
Bank or the Swing Line Lender;
(ii)
subject any Lender, any Issuing Bank or the Swing Line Lender to any Tax of any kind whatsoever with
respect to this Agreement, any Letter of Credit, any participation in a Letter of Credit or any Eurocurrency Rate Loan made by it,
or change the basis of taxation of payments to such Lender, Issuing Bank, or Swing Line Lender, as applicable, in respect thereof
(except, in each case, for (A) Taxes with respect to which the Borrower is obligated to pay additional amounts or indemnity
payments pursuant to Section 3.01, (B) any Taxes and other amounts described in clauses (ii) through (iv) of the second sentence
of Section 3.01(a) that are imposed with respect to payments to or for the account of any Agent, any Lender, any Issuing Bank or
the Swing Line Lender under any Loan Document, (C) Connection Income Taxes, and (D) Other Taxes); or
(iii)
impose on any Lender, any Issuing Bank or the Swing Line Lender, the London interbank market, the
Canadian bankers’ acceptances market or any other applicable offshore interbank market any other condition, cost or expense
affecting this Agreement, any Letter of Credit, any participation in a Letter of Credit or Eurocurrency Rate Loans (other than with
respect to Taxes) made by such Lender or any Issuing Bank or the Swing Line Lender that is not otherwise accounted for in the
definition of the “Adjusted Eurocurrency Rate” or this clause (a);
and the result of any of the foregoing shall be to increase the cost to such Lender, such Issuing Bank or the Swing Line Lender of making or
maintaining any Loan the interest on which is determined by reference to the Eurocurrency Rate or, in the case of a Change in Law with
respect to Taxes, making or maintaining any Loan (or of maintaining its obligation to make any such Loan), or to increase the cost to such
Lender, such Issuing Bank or such other Lender of participating in, issuing or maintaining any Letter of Credit (or of maintaining its
obligation to participate in or to issue any Letter of Credit, or to reduce the amount of any sum received or receivable by such Lender or such
Issuing Bank (whether of principal, interest or any other amount)) then, from time to time within ten days after demand by such Lender or
such Issuing Bank setting forth in reasonable detail such increased costs (with a copy of such demand to the Administrative Agent) (provided
that such calculation will not in any way require disclosure of confidential or price-sensitive information or any other information the
disclosure of which is prohibited by law), the Borrower or Co-Borrower, as applicable, will pay to such Lender or such Issuing Bank such
additional amount or amounts as will compensate such Lender or such Issuing Bank for such additional costs incurred or reduction
suffered. No Lender, Issuing Bank or Swing Line Lender shall request that the Borrower or applicable Co-Borrower, as applicable, pay any
additional amount pursuant to this Section 3.04(a) unless it shall concurrently make similar requests to other borrowers similarly situated and
affected by such Change in Law and from whom such Lender, Issuing Bank or Swing Line Lender is entitled to seek similar amounts.
(b)
Capital Requirements. If any Lender or any Issuing Bank reasonably determines that any Change in Law affecting
such Lender or such Issuing Bank or any Lending Office of such Lender or such
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Issuing Bank or such Lender’s or Issuing Bank’s holding company, if any, regarding liquidity or capital requirements has or would have the
effect of reducing the rate of return on such Lender’s or Issuing Bank’s capital or on the capital of such Lender’s or Issuing Bank’s holding
company, if any, as a consequence of this Agreement, the Commitments of such Lender or such Issuing Bank or the Loans made by or
Letters of Credit issued by it to a level below that which such Lender or such Issuing Bank or such Lender’s or Issuing Bank’s holding
company could have achieved but for such Change in Law (taking into consideration such Lender’s or such Issuing Bank’s policies and the
policies of such Lender’s or Issuing Bank’s holding company with respect to liquidity or capital adequacy), then from time to time upon
demand of such Lender or such Issuing Bank setting forth in reasonable detail the charge and the calculation of such reduced rate of return
(with a copy of such demand to the Administrative Agent) (provided that such calculation will not in any way require disclosure of
confidential or price-sensitive information or any other information the disclosure of which is prohibited by law), the Borrower or Co-
Borrower, as applicable, will pay to such Lender or such Issuing Bank, as the case may be, such additional amount or amounts as will
compensate such Lender, such Issuing Bank or such Lender’s or Issuing Bank’s holding company for any such reduction suffered.
(c)
Certificates for Reimbursement. A certificate of a Lender or an Issuing Bank setting forth the amount or amounts
necessary to compensate such Lender or such Issuing Bank or their respective holding company, as the case may be, as specified in
subsection (a) or (b) of this Section 3.04 and delivered to the Borrower or Co-Borrower, as applicable, shall be conclusive absent manifest
error. The Borrower shall pay such Lender, as the case may be, the amount shown as due on any such certificate within ten days after receipt
thereof.
(d)
Delay in Requests. Failure or delay on the part of any Lender or any Issuing Bank to demand compensation pursuant
to the foregoing provisions of this Section 3.04 shall not constitute a waiver of such Lender’s or such Issuing Bank’s right to demand such
compensation, provided that the Borrower and Co-Borrowers shall not be required to compensate a Lender or an Issuing Bank pursuant to the
foregoing provisions of this Section 3.04 for any increased costs incurred or reductions suffered more than one hundred and eighty days prior
to the date that such Lender or such Issuing Bank notifies the Borrower of the Change in Law giving rise to such increased costs or
reductions and of such Lender’s or such Issuing Bank’s intention to claim compensation therefor (except that, if the Change in Law giving
rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the period of
retroactive effect thereof).
(e)
Reserves on Eurocurrency Rate Loans. The Borrower shall pay to each Lender, as long as such Lender shall be
required to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency Rate funds or deposits (currently
known as “Eurocurrency Liabilities” in Regulation D of the FRB), additional interest on the unpaid principal amount of each Eurocurrency
Rate Loan equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by such lender in good faith,
which determination shall be conclusive), which shall be due and payable on each date on which interest is payable on such Loan made to the
Borrower or Co-Borrower, as applicable; provided the Borrower shall have received at least 10 days’ prior notice (with a copy to the
Administrative Agent) of such additional interest from such Lender. If a Lender fails to give notice 10 days prior to the relevant Interest
Payment Date, such additional interest shall be due and payable 10 days from receipt of such notice.
Section 3.05
Funding Losses
. Upon written demand of any Lender (with a copy to the Administrative Agent) from time to time, which demand shall set forth
in reasonable detail the basis for requesting such amount (provided that such calculation will not in any way require disclosure of confidential
or price-sensitive information or any other information the disclosure of which is prohibited by law), the Borrower or Co-Borrower, as
applicable, shall promptly compensate such Lender for and hold
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such Lender harmless from any loss, cost, liability or expense (excluding loss of anticipated profits or margin) actually incurred by it as a
result of:
(a)
any continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day prior to the
last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);
any failure by the Borrower or applicable Co-Borrower (for a reason other than the failure of such Lender to make a
Loan) to prepay, borrow, continue or convert any Loan other than a Base Rate Loan on the date or in the amount notified by the Borrower; or
(b)
(c)
any assignment of a Eurocurrency Rate Loan on a day prior to the last day of the Interest Period therefor as a result of a
request by the Borrower pursuant to Section 3.07;
including any loss or expense (excluding loss of anticipated profits or margin) actually incurred by reason of the liquidation or reemployment
of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were
obtained. Notwithstanding the foregoing, no Lender may make any demand under this Section 3.05 (i) with respect to the “floor” specified
in the parenthetical in the first sentence of the definition of “Adjusted Eurocurrency Rate”, (ii) with respect to the “floor” specified in the
definition of “CDOR Rate” or (iii) in connection with any prepayment of interest on Loans.
Section 3.06
Matters Applicable to All Requests for Compensation
.
(a)
Designation of a Different Lending Office. If any Lender requests compensation under Section 3.04, or the Borrower
or a Co-Borrower is required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 3.01, or if any Lender gives a notice pursuant to Section 3.02, then such Lender shall use reasonable efforts to designate a
different Lending Office for funding or booking its Loans hereunder or to assign its rights and obligations hereunder to another of its offices,
branches or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable
pursuant to Section 3.01 or 3.04, as the case may be, in the future, or eliminate the need for the notice pursuant to Section 3.02, as applicable,
and (ii) in each case, would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to
such Lender in any material economic, legal or regulatory respect.
(b)
Suspension of Lender Obligations. If any Lender requests compensation by the Borrower or under Section 3.04, the
Borrower or Co-Borrower may, by notice to such Lender (with a copy to the Administrative Agent), suspend the obligation of such Lender to
make or continue Eurocurrency Rate Loans from one Interest Period to another Interest Period, or to convert Base Rate Loans into
Eurocurrency Rate Loans, until the event or condition giving rise to such request ceases to be in effect (in which case the provisions of
Section 3.06(c) shall be applicable); provided that such suspension shall not affect the right of such Lender to receive the compensation so
requested.
(c)
Conversion of Eurocurrency Rate Loans. If any Lender gives notice to the Borrower (with a copy to the Administrative
Agent) that the circumstances specified in Section 3.02, 3.03 or 3.04 hereof that gave rise to the conversion of such Lender’s Eurocurrency
Rate Loans no longer exist (which such Lender agrees to do promptly upon such circumstances ceasing to exist) at a time when Eurocurrency
Rate Loans made by other Lenders are outstanding, such Lender’s Base Rate Loans shall be automatically converted, on the first day(s) of
the next succeeding Interest Period(s) for such outstanding Eurocurrency Rate Loans, to the extent necessary so that, after giving effect
thereto, all Loans of a given Class held by the Lenders of such Class holding Eurocurrency Rate Loans and by such Lender are held pro rata
(as to
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principal amounts, interest rate basis, and Interest Periods) in accordance with their respective Pro Rata Shares.
Section 3.07
Replacement of Lenders Under Certain Circumstances
. If (i) any Lender requests compensation under Section 3.04 or ceases to make Eurocurrency Rate Loans as a result of any
condition described in Section 3.02 or Section 3.04, (ii) the Borrower or Co-Borrower is required to pay any Taxes or additional amounts to
any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01 and such Lender has declined or is unable
to designate a different Lending Office in accordance with Section 3.01(i), (iii) any Lender is a Non-Consenting Lender, (iv) any Lender does
not accept an Extension Offer, (v) (A) any Lender shall become and continue to be a Defaulting Lender and (B) such Defaulting Lender shall
fail to cure the default pursuant to Section 2.19(b) within five Business Days after the Borrower’s request that it cure such default or (vi) any
other circumstance exists hereunder that gives the Borrower the right to replace a Lender as a party hereto, then the Borrower may, at its sole
expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse
(in accordance with and subject to the restrictions contained in, and consents required by, Section 11.07), all of its interests, rights and
obligations under this Agreement and the related Loan Documents (other than its existing rights to payments pursuant to Section 3.01 or
Section 3.04) to one or more Eligible Assignees that shall assume such obligations (any of which assignee may be another Lender, if a
Lender accepts such assignment), provided that:
(a)
the Borrower shall have paid to the Administrative Agent the assignment fee specified in Section 11.07(b)(iv);
(b)
such Lender shall have received payment of an amount equal to the outstanding principal of its Loans and
participations in Letters of Credit, Swing Line Loans and Protective Advances, accrued interest thereon, accrued fees and all other amounts
payable to it hereunder and under the other Loan Documents (including any amounts payable under Section 3.05) from the assignee (to the
extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case of all other amounts);
(c)
such Lender being replaced pursuant to this Section 3.07 shall (i) execute and deliver an Assignment and Assumption
with respect to such Lender’s Commitment and outstanding Loans and participations in Letters of Credit, Swing Line Loans and Protective
Advances, and (ii) deliver any Notes evidencing such Loans to the Borrower or Administrative Agent (or a lost or destroyed note indemnity
in lieu thereof); provided that the failure of any such Lender to execute an Assignment and Assumption or deliver such Notes shall not render
such sale and purchase (and the corresponding assignment) invalid and such assignment shall be recorded in the Register and the Notes shall
be deemed to be canceled upon such failure;
(d)
the Eligible Assignee shall become a Lender hereunder and the assigning Lender shall cease to constitute a Lender
hereunder with respect to such assigned Loans, Commitments and participations, except with respect to indemnification provisions under this
Agreement, which shall survive as to such assigning Lender;
(e)
in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to
be made pursuant to Section 3.01, such assignment will result in a reduction in such compensation or payments thereafter;
(f)
in the case of any such assignment resulting from a Lender being a Non-Consenting Lender or failing to accept an
Extension Offer, the Eligible Assignee shall consent, at the time of such assignment, to each matter in respect of which such Lender being
replaced was a Non-Consenting Lender or accept such Extension Offer, as the case may be; and
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(g)
such assignment does not conflict with applicable Laws.
Notwithstanding anything to the contrary contained above, any Lender that acts as an Issuing Bank may not be replaced hereunder
at any time that it has any Letter of Credit outstanding hereunder unless arrangements reasonably satisfactory to such Issuing Bank (including
the furnishing of a back-up standby letter of credit in form and substance, and issued by an issuer reasonably satisfactory to such Issuing
Bank or the depositing of cash collateral into a cash collateral account in amounts and pursuant to arrangements reasonably satisfactory to
such Issuing Bank) have been made with respect to each such outstanding Letter of Credit and the Lender that acts as the Administrative
Agent may not be replaced hereunder except in accordance with the terms of Section 10.09.
In the event that (i) the Borrower or the Administrative Agent has requested that the Lenders consent to a departure or waiver of
any provisions of the Loan Documents or agree to any amendment thereto, (ii) the consent, waiver or amendment in question requires the
agreement of each Lender, all affected Lenders or all the Lenders or all affected Lenders with respect to a certain Class or Classes of the
Loans and (iii) the Required Lenders or Required Facility Lenders, as applicable, have agreed to such consent, waiver or amendment, then
any Lender who does not agree to such consent, waiver or amendment shall be deemed a “Non-Consenting Lender.”
A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender
or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
Section 3.08
Survival
. All of the Borrower’s obligations under this Article III shall survive termination of the Aggregate Commitments, repayment of
all other Obligations hereunder and resignation of the Administrative Agent or the Collateral Agent.
ARTICLE IV.
CONDITIONS PRECEDENT TO BORROWINGS
Section 4.01
Conditions to Initial Borrowing
.
The obligation of each Lender to extend credit to the Borrower and of each Issuing Bank to issue Letters of Credit hereunder on
the Closing Date is subject only to the satisfaction, or waiver in accordance with Section 11.01, each of the following conditions precedent,
except as otherwise agreed between the Borrower and the Lead Arrangers:
(a)
The Administrative Agent’s receipt of the following, each of which may be originals, facsimiles or copies in .pdf
format unless otherwise specified:
(i)
to the extent the amount of the Initial Revolving Borrowing exceeds $0, a Committed Loan Notice duly
executed by the Borrower delivered as forth in Section 2.01(b), which (if delivered prior to the Closing Date) shall be deemed to
be conditioned on the consummation of the Transactions;
(ii)
Closing Date;
this Agreement duly executed by Holdings, the Initial Borrower, the Company and the Co-Borrower as of the
(iii)
the Guaranty, the Security Agreement and the Canadian Security Agreement, in each case, duly executed by
each applicable Loan Party;
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(iv)
delivery to the Collateral Agent or the Term Loan Agent (as bailee for the Collateral Agent pursuant to the
terms of the Closing Date ABL Intercreditor Agreement) of certificates, if any, representing the Pledged Equity of the Borrower
and the Restricted Subsidiaries that constitute Collateral, in each case, (A) to the extent the issuer of such certificate is a
corporation or has “opted into” Article 8 of the UCC (and with respect to an interest in a partnership organized under the laws of
Canada, to the extent the terms of any such interest expressly provide that such interest is a “security” for the purposes of the
Securities Transfer Act (Ontario)) and (B) accompanied by undated stock powers executed in blank and evidence that all other
actions required under the terms of the Security Agreement and the Canadian Security Agreement to perfect the security interests
created by the Security Agreement and the Canadian Security Agreement have been taken except as specified in Section 6.15
hereof and the Security Agreement and the Canadian Security Agreement; provided, however, that, each of the foregoing
requirements, including the delivery of documents and instruments required pursuant to the terms of the Collateral Documents
(other than to the extent that a Lien on such Collateral may be perfected (x) by the filing of a financing statement or financing
change statement, as applicable, under the Uniform Commercial Code or the PPSA or (y) by the delivery of stock certificates of
the Borrower and its Subsidiaries to the Collateral Agent or the Term Loan Agent (as bailee for the Collateral Agent pursuant to
the terms of the Closing Date ABL Intercreditor Agreement)), shall not constitute conditions precedent to the Borrowing on the
Closing Date after the Borrower’s use of commercially reasonable efforts to provide such items on or prior to the Closing Date if
the Borrower agrees to deliver, or cause to be delivered, such documents and instruments, or take or cause to be taken such other
actions as may be required to perfect such security interests within ninety (90) days after the Closing Date (subject to extensions
approved by the Administrative Agent in its reasonable discretion or as provided in Section 6.15);
(v)
(A) certificates of good standing, or its equivalent, from the secretary of state or other applicable office of the
jurisdiction of organization or formation of the Borrower and each other Loan Party if applicable in the relevant jurisdiction, (B)
resolutions or other applicable action of the Borrower and each other Loan Party and (C) an incumbency certificate and/or other
certificate of Responsible Officers of the Borrower and each other Loan Party, evidencing the identity, authority and capacity of
each Responsible Officer thereof authorized to act as a Responsible Officer in connection with this Agreement and the other Loan
Documents to which it is a party or is to be a party on the Closing Date;
(vi)
an opinion from the following special counsel to the Loan Parties (or certain of the Loan Parties): (A)
Latham & Watkins LLP, with respect to matters of New York and certain aspects of Delaware law and (B) Miller Titerle Law
Corporation, with respect to matters of British Columbia and Canada;
(vii)
a certificate from the chief financial officer or other officer with equivalent duties of the Borrower as to the
Solvency (after giving effect to the Transactions on the Closing Date) of the Borrower substantially in the form attached hereto as
Exhibit I;
(viii)
a certificate from a Responsible Officer of the Borrower certifying as to the satisfaction of the condition in
clause (g) (with respect to the Specified Representations only) below;
provided, however, that, with respect to the requirements set forth in clauses (iii), (iv) and (v) above, each document or instrument required to
be executed by a Loan Party other than Holdings and the Initial Borrower (a “Post-Closing Loan Party”), such execution shall not be a
condition to the initial availability of the Facility on the Closing Date, it being agreed that such documents shall be executed and delivered in
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escrow prior to the consummation of the Acquisition and released from escrow upon funding of the Initial Term Loans and consummation of
the Acquisition and upon such release, each Post-Closing Loan Party will be deemed to have made the Company Specified Representations
with respect to itself;
(b)
all fees and expenses required to be paid hereunder on the Closing Date and, with respect to expenses and legal fees, to
the extent invoiced in reasonable detail at least two Business Days before the Closing Date (except as otherwise reasonably agreed to by the
Borrower) shall have been paid in full, it being agreed that such fees and expenses may be paid with the proceeds of the initial funding of one
or more of the Facilities;
(c)
the (i) Term Loan Documents, (ii) the Loan Documents and (iii) the Senior Secured Notes Documents, required to be
executed on the Closing Date shall have been duly executed and delivered by each Loan Party required to execute such documents pursuant
to the terms thereof;
(d)
the Lenders shall have received at least three Business Days prior to the Closing Date (i) all documentation and other
information about the Loan Parties required under applicable “know your customer” and anti-money laundering rules and regulations,
including the USA PATRIOT Act, and (ii) to the extent the Borrower qualifies as a “legal entity customer”, a Beneficial Ownership
Certification, that, in each case, has been reasonably requested in writing at least ten Business Days prior to the Closing Date;
(e)
confirmation from the Borrower (in the form of an officer’s certificate) that prior to or substantially simultaneously
with the initial Borrowing on the Closing Date,
(i)
Refinancing;
each of the following shall have been or will be consummated: the Equity Contribution and the Closing Date
(ii)
the Acquisition shall have been or will be consummated in accordance with the terms of the Acquisition
Agreement; and
(iii)
since its execution, the Acquisition Agreement has not been amended, waived or modified (whether
pursuant to the Borrower’s consent or otherwise) in any respect in a manner that in the aggregate is materially adverse to the
interests of the Lenders, in their respective capacities as such, without the consent of the Lead Arrangers (such consent not to be
unreasonably withheld, conditioned or delayed); provided, that (i) a reduction in the purchase price under the Acquisition
Agreement (or amendment, supplement or modification to the Acquisition Agreement pursuant to which such reduction is made)
will be deemed not to be materially adverse to the interests of the Lenders and will be allocated (1) first, to a reduction in the
Equity Contribution until the Equity Contribution equals the Minimum Equity Contribution and (2) thereafter to a percentage
reduction to the Equity Contribution equal to the Minimum Equity Contribution, with the balance reducing any amounts to be
funded under the Senior Secured Notes, (ii) any amendment, supplement, modification or waiver to the terms of the Acquisition
Agreement that has the effect of increasing the cash purchase price thereunder to be paid on the Closing Date will not be deemed
to be materially adverse to the Commitment Parties if such increase is not funded with indebtedness for borrowed money incurred
on the Closing Date (other than the Revolving Loans, the Term Loans and the Senior Secured Notes), (iii) any amendment,
supplement or modification to, or waiver with respect to, any “marketing period,” or similar provisions in the Acquisition
Agreement will be deemed not to be materially adverse to the Lenders and (iv) any amendment, supplement or modification to, or
waiver with respect to, the definition of “Company Material Adverse Effect,” the definition of “End Date” (or equivalent) or the
“Xerox” provisions contained in the Acquisition Agreement (in each case, as in effect on May 10, 2021) will be deemed to be
materially adverse to the Lenders;
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(f)
there shall not have occurred and be continuing a Company Material Adverse Effect (as defined in the Acquisition
Agreement) that would result in the failure of a condition precedent to the Initial Borrower’s obligations to consummate the Acquisition
under the Acquisition Agreement or that would give it the right (taking into account any notice and cure provisions) to terminate its
obligations pursuant to the terms of the Acquisition Agreement;
(g)
the Acquisition Agreement Representations and the Specified Representations shall be true and correct in all material
respects on and as of the date of the Closing Date; provided that, a failure of an Acquisition Agreement Representation to be accurate will not
result in a failure of a condition precedent under this Section 4.01 or a Default or an Event of Default, unless such failure results in a failure
of a condition precedent to the Merger Sub’s (or its affiliates’) obligation to consummate the Acquisition or such failure gives the Merger Sub
the right (taking into account any notice and cure provisions) to terminate its (or its affiliates’) obligations pursuant to the terms of the
Acquisition Agreement; provided, further, that to the extent that the Acquisition Agreement Representations and the Specified
Representations specifically refer to an earlier date, they shall be true and correct in all material respects as of such earlier date and any such
representation and warranty that is qualified as to “materiality,” “Material Adverse Effect” or similar language shall be true and correct (after
giving effect to any qualification therein) in all respects on such respective dates;
(h)
the Lead Arrangers shall have received:
(i)
an audited balance sheet and related statements of earnings (loss) and comprehensive income (or loss) and
cash flows of the Acquired Business (or a direct or indirect parent thereof) as of the end of the fiscal years ended December 31,
2018, 2019, and 2020, in each case to the extent delivered to the Initial Borrower pursuant to the terms of the Acquisition
Agreement;
(ii)
an unaudited balance sheet and related statements of earnings (loss) and comprehensive income (or loss) and
cash flows of the Acquired Business (or a direct or indirect parent thereof) as of the end of each fiscal quarter (other than the
fourth fiscal quarter of any fiscal year) ended after date of the most recent balance sheet delivered pursuant to clause (i) above and
at least 45 days prior to the Closing Date, in each case, to the extent delivered to the Initial Borrower pursuant to the terms of the
Acquisition Agreement; and
(iii)
an unaudited pro forma consolidated balance sheet and related pro forma income statement of the Acquired
Business (or a direct or indirect parent thereof) as of and for the four consecutive quarter period ending on the last day of the most
recently completed fiscal quarter of the Acquired Business (or a direct or indirect parent thereof) for which financial statements
have been delivered, or are required to be delivered pursuant to clause (i) or (ii) above in each case, giving effect to the
Transactions as 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 the income statement), it being agreed that such pro forma financial statements need not comply with
Regulation S-X under the U.S. Securities Act of 1933, as amended, or include purchase accounting adjustments.
(i)
the Borrower shall have delivered a Borrowing Base Certificate to the Administrative Agent which calculates the
Borrowing Base as of the last Business Day of the most recent month ending at least twenty (20) calendar days prior to the Closing Date.
The Lead Arrangers acknowledge receipt of the audited financial statements for the fiscal years ending December 2018, 2019, and 2020 and
the unaudited financial statements for the fiscal quarters ending March 31, 2021 and June 30, 2021.
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Without limiting the generality of the provisions of the last paragraph of Section 11.03, for purposes of determining compliance with the
conditions specified in this Section 4.01, each Lender that has signed this Agreement or funded Loans hereunder shall be deemed to have
consented to, approved or accepted or to be satisfied with, each document or other matter required under this Section 4.01 to be consented to
or approved by or acceptable or satisfactory to a Lender, unless the Administrative Agent shall have received notice from such Lender prior
to the proposed Closing Date specifying its objection thereto.
Section 4.02
Conditions to All Borrowings After the Closing Date
. Except as set forth in Section 2.16(f) with respect to Incremental Loans and subject to Section 1.08, the obligation of each
Lender to honor a Committed Loan Notice, of each Issuing Bank to issue, amend, renew or extend any Letter of Credit and of the Swing Line
Lender to make Swing Line Loans, in each case, after the Closing Date, is subject to the following conditions precedent:
(a)
The representations and warranties of the Borrower and each other Loan Party contained in Article V or any other Loan
Document shall be true and correct in all material respects on and as of the date of such Borrowing or issuance, amendment, renewal or
extension of any Letter of Credit; provided that, to the extent that such representations and warranties specifically refer to an earlier date, they
shall be true and correct in all material respects as of such earlier date; provided, further, that any representation and warranty that is qualified
as to “materiality,” “Material Adverse Effect” or similar language shall be true and correct (after giving effect to any qualification therein) in
all respects on such respective dates.
(b)
As of the date of such Borrowing or the date of any issuance, amendment, renewal or extension of any Letter of Credit,
no Default or Event of Default shall have occurred and be continuing on such date (immediately prior to giving effect to the extensions of
credit requested to be made) or would result after giving effect to the extensions of credit requested to be made on such date.
(c)
not exceed the Line Cap.
As of the date of such Borrowing and after giving effect thereto, the Total Utilization of Revolving Commitments shall
(d)
If applicable, the Administrative Agent shall have received a Committed Loan Notice in accordance with the
requirements hereof and, if applicable, the applicable Issuing Bank shall have received an Issuance Notice in accordance with the
requirements hereof or the Swing Line Lender shall have received a Swing Line Loan Request in accordance with the requirements hereof.
(e)
For purposes of this Section 4.02, the representations and warranties contained in Section 5.05(a) shall be deemed to
refer to the most recent financial statements furnished pursuant to Sections 6.01(a) and (b), respectively.
Subject to Section 1.08(f), each Committed Loan Notice (other than a Committed Loan Notice requesting only a conversion of Loans to
another Type or a continuation of Eurocurrency Rate Loans) and each Issuance Notice submitted by the Borrower shall be deemed to be a
representation and warranty that the condition specified in Sections 4.02(a), (b) and (c) has been satisfied on and as of the date of the
applicable Borrowing or issuance, amendment, renewal or extension of a Letter of Credit.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants each of the following to the Lenders, the Issuing Banks, the Administrative Agent and the
Collateral Agent, in each case, to the extent and, unless otherwise specifically agreed by the Borrower, only on the dates required by Section
2.16, or Article IV, as applicable.
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Section 5.01
Existence, Qualification and Power; Compliance with Laws
. Each Loan Party and each Restricted Subsidiary that is a Material Subsidiary,
(a)
is duly organized or formed, validly existing and in good standing under the Laws of the jurisdiction of its
incorporation or organization (to the extent such concepts exist in such jurisdiction);
(b)
has all corporate or other organizational power and authority to (i) own its assets and carry on its business as currently
conducted and (ii) in the case of the Loan Parties, execute, deliver and perform its obligations under the Loan Documents to which it is a
party and consummate the Transactions;
(c)
is duly qualified and in good standing (to the extent such concepts exist in such jurisdiction) under the Laws of each
jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification;
(d)
(e)
conducted; and
is in compliance with all applicable Laws;
has all requisite governmental licenses, authorizations, consents and approvals to operate its business as currently
(f)
except in each case referred to in clause (c), (d) or (e), to the extent that failure to do so has not resulted in, or is not
reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 5.02
Authorization; No Contravention
.
(a)
The execution, delivery and performance by each Loan Party of each Loan Document to which it is a party has been
duly authorized by all necessary corporate or other organizational action.
(b)
None of the execution, delivery or performance by each Loan Party of each Loan Document to which it is a party nor
the consummation of the Transactions will,
(i)
contravene the terms of any of its Organization Documents;
(ii)
result in any breach or contravention of, or the creation of any Lien (other than a Permitted Lien) upon any
assets of such Loan Party or any Restricted Subsidiary, under (A) any Contractual Obligation relating to Material Indebtedness or
(B) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Loan Party or its
property is subject;
(iii)
violate any applicable Law; or
(iv)
require any approval of stockholders, members or partners or any approval or consent of any Person under
any Contractual Obligation relating to Material Indebtedness, except for such approvals or consents which will be obtained on or
before the Closing Date;
except with respect to any breach, contravention or violation (but not creation of Liens) referred to in clauses ((ii)), ((iii)) and ((iv)), to the
extent that such breach, contravention or violation has not resulted in, or is not reasonably expected, individually or in the aggregate, to result
in a Material Adverse Effect.
Section 5.03
Governmental Authorization
. No material approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental
Authority is necessary or
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required in connection with the execution, delivery or performance by any Loan Party of this Agreement or any other Loan Document,
except for,
(a)
filings necessary to perfect the Liens on the Collateral granted by the Loan Parties in favor of the Secured Parties;
(b)
the approvals, consents, exemptions, authorizations, actions, notices and filings that have been duly obtained, taken,
given or made and are in full force and effect (except to the extent not required to be obtained, taken, given or made or in full force and effect
pursuant to the Collateral Documents); and
(c)
those approvals, consents, exemptions, authorizations or other actions, notices or filings, the failure of which to obtain
or make has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 5.04
Binding Effect
. This Agreement and each other Loan Document has been duly executed and delivered by each Loan Party that is party hereto
and thereto. This Agreement and each other Loan Document constitutes a legal, valid and binding obligation of each Loan Party, enforceable
against each Loan Party that is party thereto in accordance with its terms, except as such enforceability may be limited by applicable Debtor
Relief Laws and by general principles of equity and principles of good faith and fair dealing.
Section 5.05
Financial Statements; No Material Adverse Effect
.
(a)
The Annual Financial Statements fairly present in all material respects the financial condition of the Borrower and its
Subsidiaries as of the dates thereof and their results of operations for the period covered thereby in accordance with GAAP (as in effect on
the Closing Date (or the date of preparation)) consistently applied throughout the periods covered thereby, except as otherwise expressly
noted therein.
(b)
Since the Closing Date, there has been no event or circumstance, either individually or in the aggregate, that has
resulted in, and is reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
(c)
The forecasts of consolidated balance sheets and statements of comprehensive income (loss) of the Borrower and its
Subsidiaries which have been furnished to the Administrative Agent prior to the Closing Date, when taken as a whole, have been prepared in
good faith on the basis of the assumptions stated therein, which assumptions were believed to be reasonable at the time made and at the time
the forecasts are delivered, it being understood that (i) no forecasts are to be viewed as facts, (ii) any forecasts are subject to significant
uncertainties and contingencies, many of which are beyond the control of the Loan Parties, (iii) no assurance can be given that any particular
forecasts will be realized and (iv) actual results may differ and such differences may be material.
Section 5.06
Litigation
. Except as set forth in Schedule 5.06, there are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of
the Borrower, overtly threatened in writing, at law, in equity, in arbitration or before any Governmental Authority, by or against the Borrower
or any of the Restricted Subsidiaries or in relation to any Canadian Pension Plan or Canadian Multi-Employer Pension Plan that has resulted
in, or is reasonably expected, individually or in the aggregate, to result in Material Adverse Effect.
Section 5.07
Labor Matters
. Except as set forth on Schedule 5.07 or as has not resulted in, or is not reasonably expected, individually or in the aggregate, to
result in a Material Adverse Effect: (a) there
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are no strikes or other labor disputes against any of the Borrower or the Restricted Subsidiaries pending or, to the knowledge of the Borrower,
threatened and (b) hours worked by and payment made based on hours worked to employees of the Borrower or a Restricted Subsidiary have
not been in material violation of the Fair Labor Standards Act or any other applicable Laws dealing with wage and hour matters.
Section 5.08
Ownership of Property; Liens; Insurance
. Each Loan Party and each Restricted Subsidiary has good and valid record title in fee simple to, or valid leasehold interests in, or
easements or other limited property interests in, all real property necessary in the ordinary conduct of its business, free and clear of all Liens
except for Permitted Liens and except where the failure to have such title or other interest has not resulted in, or is not reasonably expected,
individually or in the aggregate, to result in a Material Adverse Effect. Except when the failure to do so has not resulted in, or is not
reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect, the Borrower and each Restricted Subsidiary has
maintained with insurance companies that the Borrower believes (in the good faith judgment of its management) are financially sound and
reputable at the time the relevant coverage is placed or renewed or with a Captive Insurance Subsidiary, insurance with respect to its
properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business
and of such types and in such amounts (after giving effect to any self-insurance) as are customarily carried under similar circumstances by
such other Persons.
Section 5.09
Environmental Matters
.
(a)
Except as has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material
Adverse Effect, (i) the Loan Parties and the Restricted Subsidiaries are in compliance with all applicable Environmental Laws (including
having obtained all Environmental Permits) and (ii) none of the Loan Parties or any of the Restricted Subsidiaries is subject to any pending,
or to the knowledge of the Loan Parties, threatened Environmental Claim or any other Environmental Liability or is aware of any basis for
any Environmental Liability.
(b)
None of the Loan Parties or any of the Restricted Subsidiaries has used, released, treated, stored, transported or
disposed of Hazardous Materials, at or from any currently or formerly owned or operated real estate or facility relating to its business, in a
manner that has resulted in, or is reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 5.10
Taxes
. Except as has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse
Effect, the Borrower and the Restricted Subsidiaries have timely filed all foreign, U.S. federal and state and other tax returns and reports
required to be filed, and have timely paid all foreign, U.S. federal and state and other Taxes, assessments, fees and other governmental
charges (including satisfying their withholding Tax obligations) levied or imposed on their properties, income or assets or otherwise due and
payable, except those which are being contested in good faith by appropriate actions diligently conducted and for which adequate reserves
have been provided in accordance with GAAP.
Section 5.11
ERISA Compliance
.
(a)
Except as set forth on Schedule 5.11(a) or has not resulted in, or is not reasonably expected, individually or in the
aggregate, to result in a Material Adverse Effect, (i) each Plan and Canadian Pension Plan is registered under and in compliance with the
applicable provisions of ERISA, the Code and other federal or state, provincial, territorial and foreign Laws and (ii) the Borrower and each
Restricted Subsidiary have complied with all funding obligations under each Canadian Pension Plan and each Canadian Multi-Employer
Pension Plan.
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(b)
Except as set forth on Schedule 5.11(b) or, with respect to each of the below clauses of this Section 5.11(b), as has not
resulted in, or is not reasonably expected, individually or in the aggregate, to result in Material Adverse Effect,
(i)
(ii)
no ERISA Event or Canadian Pension Plan Event has occurred or is reasonably expected to occur;
neither the Borrower, nor any Subsidiary Guarantor nor any of their respective ERISA Affiliates has engaged
in a transaction that is subject to Sections 4069 or 4212(c) of ERISA; and
(iii)
neither the Borrower, nor any Subsidiary Guarantor nor any ERISA Affiliate has been notified by the
sponsor of a Multiemployer Plan that such Multiemployer Plan is insolvent (within the meaning of Section 4245 of ERISA) or has
been determined to be in “endangered” or “critical” status (within the meaning of Section 432 of the Code or Section 305 of
ERISA) and no such Multiemployer Plan is expected to be insolvent or in endangered or critical status.
(c)
Except as set forth on Schedule 5.11(c), no Canadian Pension Plan contains a “defined benefit provision” as defined in
subsection 147.1(1) of the Canadian Tax Act.
Section 5.12
Subsidiaries
. As of the Closing Date, all of the outstanding Equity Interests in the Borrower and each Material Subsidiary have been validly
issued and are fully paid and (if applicable) non-assessable, and all Equity Interests owned by Holdings (in the Borrower), and by the
Borrower or any Subsidiary Guarantor in any of their respective direct Material Subsidiaries are owned free and clear of all Liens (other than
Permitted Liens) of any Person. As of the Closing Date, Schedule 5.12 (i) sets forth the name and jurisdiction of each Subsidiary, (ii) sets
forth the ownership interest of Holdings, the Borrower and each Subsidiary in each Subsidiary, including the percentage of such ownership
and (iii) identifies each Subsidiary that is a Subsidiary the Equity Interests of which are required to be pledged on the Closing Date pursuant
to the Collateral Documents.
Section 5.13
Margin Regulations; Investment Company Act
.
(a)
As of the Closing Date, none of the Collateral is Margin Stock. No Loan Party is engaged nor will it engage,
principally or as one of its important activities, in the business of purchasing or carrying Margin Stock (within the meaning of Regulation U
issued by the FRB), or extending credit for the purpose of purchasing or carrying Margin Stock, and no proceeds of any Borrowings or
issuance of, or drawings under, any Letter of Credit will be used for any purpose that violates Regulation U.
(b)
Neither the Borrower nor any Guarantor is an “investment company” under the Investment Company Act of 1940.
Section 5.14
Disclosure
. As of the Closing Date, none of the written information and written data heretofore or contemporaneously furnished by or on
behalf of any Loan Party to any Agent or any Lender on or prior to the Closing Date in connection with the Transactions and the negotiation
of this Agreement or delivered hereunder or any other Loan Document on or prior to the Closing Date, when taken as a whole, contains any
material misstatement of fact or omits to state any material fact necessary to make such written information and written data taken as a
whole, in the light of the circumstances under which it was delivered, not materially misleading (after giving effect to all modifications and
supplements to such written information and written data, in each case, furnished after the date on which such written information or such
written data was originally delivered and prior to the Closing Date); it being understood that for purposes of this Section 5.14, such written
information and written data shall not include
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projections, pro forma financial information, financial estimates, forecasts or other forward-looking information or information of a general
economic or general industry nature or prepared by the Lead Arrangers.
Section 5.15
Intellectual Property; Licenses, Etc.
The Borrower and the Restricted Subsidiaries own or have a valid right to use, all the Intellectual Property necessary for the
operation of their respective businesses as currently conducted, except where the failure to have any such rights, has not resulted in, or is not
reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect. To the knowledge of the Borrower, the
operation of the respective businesses of the Borrower and the Restricted Subsidiaries as currently conducted does not infringe upon,
misappropriate or violate any Intellectual Property rights held by any Person except for such infringements, misappropriations or violations
that have not resulted in, or are not reasonably expected, individually or in the aggregate, to result in, a Material Adverse Effect. No claim or
litigation regarding any Intellectual Property owned by the Borrower or any of the Restricted Subsidiaries is pending or, to the knowledge of
the Borrower, threatened against the Borrower or any Restricted Subsidiary, that, has resulted in, or is reasonably expected, individually or in
the aggregate, to result in a Material Adverse Effect.
Section 5.16
Solvency
. On the Closing Date after giving effect to the Transactions, the Borrower and its Subsidiaries, on a consolidated basis, are
Solvent.
Section 5.17
USA PATRIOT Act, FCPA and OFAC
.
(a)
To the extent applicable, each of the Loan Parties and the Restricted Subsidiaries is in compliance, in all material
respects, with (a) 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
(b) the USA PATRIOT Act, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada) and other similar anti-money
laundering rules and regulations.
(b)
Each of the Loan Parties and the Restricted Subsidiaries, and their respective officers, directors and employees, and to
the Borrower’s knowledge, their respective agents, affiliates and representatives, have conducted their businesses in compliance in all
material respects with the FCPA, the Corruption of Foreign Public Officials Act (Canada), the UK Bribery Act 2010, and other similar anti-
corruption legislation in other jurisdictions. The Borrower will not directly, or to its knowledge indirectly, use the proceeds of the Loans or
Letters of Credit in violation of the FCPA, the Corruption of Foreign Public Officials Act (Canada), the UK Bribery Act 2010 or other similar
anti-corruption legislation in other jurisdictions.
(c)
None of the Loan Parties or any of the Restricted Subsidiaries, nor, to the knowledge of the Borrower, any director,
officer, agent, employee or Affiliate or representative thereof, is an individual or entity that is, or is owned or controlled by any individual or
entity that is, (a) the subject or target of any Sanctions, (b) included on OFAC’s List of Specially Designated Nationals, HMT’s Consolidated
List of Financial Sanctions Targets, the Investment Ban List or any other Sanctions list, or (c) located, organized or resident in a Designated
Jurisdiction. The Borrower will not directly, or to its knowledge indirectly, use the proceeds of the Loans or Letters of Credit or otherwise
knowingly make available such proceeds (x) to any Person, for the purpose of financing the activities of any Person that, at the time of such
financing, is (a) the subject or target of any Sanctions, (b) included on OFAC’s List of Specially Designated Nationals, HMT’s Consolidated
List of Financial Sanctions Targets, the Investment Ban List or any other Sanctions list, or (c) located, organized or resident in a Designated
Jurisdiction or (y) in any manner that would result in a violation of Sanctions by any Person.
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Section 5.18
Collateral Documents
(a)
. Except as otherwise contemplated hereby or under any other Loan Documents, the provisions of the Collateral
Documents, together with such filings and other actions required to be taken hereby or by the applicable Collateral Documents or
contemplated by the Collateral Documents (including the delivery to Collateral Agent of any Pledged Debt and any Pledged Equity required
to be delivered pursuant to the applicable Collateral Documents), are effective to create in favor of the Collateral Agent for the benefit of the
Secured Parties a legal, valid and enforceable perfected Lien (subject to Permitted Liens) on all right, title and interest of Holdings, the
Borrower and the applicable Subsidiary Guarantors, respectively, in the Collateral described therein.
Section 5.19
Use of Proceeds
. The Borrower has used the proceeds of the Loans (including the Swing Line Loans) and the Letters of Credit issued hereunder
only in compliance with (and not in contravention of) applicable Laws and each Loan Document, and not in a manner that would result in a
violation of Sanctions by any Person.
Section 5.20
Borrowing Base Certificate
. The information set forth in each Borrowing Base Certificate is true and correct in all material respects and has been prepared in
all material respects in the accordance with the requirements of this Agreement. The Accounts that are identified by the Borrower as Eligible
Accounts Receivable or Eligible Credit Insured Accounts and the Inventory that are identified by the Borrower as Eligible Inventory, in each
Borrowing Base Certificate submitted to the Administrative Agent, as of the date to which such Borrowing Base Certificate relates, comply
in all material respects with the criteria (other than any Administrative Agent-discretionary criteria established in accordance with this
Agreement) set forth in the definitions of “Eligible Accounts Receivable,” “Eligible Credit Insured Accounts” and/or “Eligible Inventory”.
ARTICLE VI.
AFFIRMATIVE COVENANTS
So long as the Termination Conditions have not been satisfied, the Borrower shall, and shall (except in the case of the covenants
set forth in Sections 6.01, 6.02 and 6.03) cause each of the Restricted Subsidiaries to:
Section 6.01
Financial Statements
. Deliver to the Administrative Agent for prompt further distribution by the Administrative Agent to each Lender each of the
following:
(a)
Audited Annual Financial Statements. Within one hundred and twenty (120) days after the end of each fiscal year of
the Borrower or, in the case of the first fiscal year ending after the Closing Date, within one hundred and fifty (150) days, a consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal year, and the related consolidated statements of comprehensive
income (loss), stockholders’ equity and cash flows for such fiscal year together with related notes thereto, setting forth in each case in
comparative form the figures for the previous fiscal year (commencing with the second full fiscal year ended after the Closing Date),
prepared in accordance with GAAP in all material respects, audited and accompanied by a report and opinion of the Borrower’s auditor on
the Closing Date or any other accounting firm of nationally or regionally recognized standing or another accounting firm reasonably
acceptable to the Administrative Agent, which report and opinion shall be prepared in accordance with generally accepted auditing standards
and shall not be subject to any explanatory statement as to the Borrower’s ability to continue as a “going concern” or like qualification or
exception (excluding any “emphasis of matter” paragraph), other than any such statement, qualification or exception resulting from or
relating to (i) an actual or anticipated breach of a Financial Covenant, (ii) an upcoming maturity date, (iii) activities, operations, financial
results or liabilities of any Person other than the Loan Parties and the Restricted Subsidiaries or (iv) changes in accounting principles or
practices, which financial statements
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shall be accompanied by management’s discussion and analysis describing results of operations in the form customarily prepared by
management of the Borrower.
(b)
Quarterly Financial Statements. As soon as available, but in any event within forty five (45) days after the end of each
of the first three fiscal quarters of each fiscal year of the Borrower (commencing with the first full fiscal quarter ending after the Closing
Date) or, in the case of the first two such full fiscal quarters ending after the Closing Date, within seventy-five (75) days, (i) a condensed
consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal quarter, (ii) the related condensed consolidated
statements of comprehensive income (loss) for such fiscal quarter and for the portion of the fiscal year then ended and (iii) the
related condensed consolidated statement of cash flows for the portion of the fiscal year then ended, setting forth, in each case of
clauses (ii) and (iii), in comparative form, the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding
portion of the previous fiscal year, in each case if ended after the Closing Date, certified by a Responsible Officer of the Borrower as fairly
presenting in all material respects the financial condition, results of operations and cash flows of the Borrower and its Subsidiaries in material
compliance with GAAP, subject to year-end adjustments and the absence of footnotes, which financial statements shall be accompanied by
management’s discussion and analysis describing results of operations in the form customarily prepared by management of the Borrower.
(c)
Lender Calls. The Borrower shall conduct annual conference calls with management of the Borrower (provided that to
the extent any conference calls for holders of the Senior Secured Notes or any refinancing thereof are conducted quarterly, the Borrower shall
conduct such lender calls quarterly), which conference calls may be combined with any conference calls for the holders of the Borrower’s or
any Parent Entity’s securities, and in each case, subject to the requirements of this covenant, within fifteen (15) Business Days (or such later
date as may be agreed by the Administrative Agent) after the time periods with respect to delivery of the financial statements required by
clauses (a) and (b) above, to discuss the financial performance of the Borrower and its Restricted Subsidiaries for the most recently ended
fiscal year or fiscal quarter, as the case may be, for which financial statements have been delivered pursuant to clause (a) or (b) above.
(d)
Budget; Projections. Prior to the consummation of a Qualifying IPO, within one hundred twenty (120) days after the
end of each fiscal year (beginning with the fiscal year ending December 31, 2021), a consolidated budget for the following fiscal year on a
quarterly basis as customarily prepared by management of the Borrower for its internal use and setting forth the material underlying
assumptions based on which such consolidated budget was prepared (including any projected consolidated balance sheet of the Borrower and
its Subsidiaries as of the end of the following fiscal year and the related consolidated statements of projected operations or income and
projected cash flow, in each case, to the extent prepared by management of the Borrower and included in such consolidated budget), which
projected financial statements shall be prepared in good faith on the basis of assumptions believed by the Borrower to be reasonable at the
time of preparation of such projected financial statements.
(e)
Unrestricted Subsidiaries. Simultaneously with the delivery of each set of consolidated financial statements referred to
in Section 6.01(a) and Section 6.01(b) above, such supplemental financial information (which need not be audited) as is necessary to
eliminate the accounts of Unrestricted Subsidiaries (if any) from such consolidated financial statements.
Notwithstanding the foregoing, the obligations in paragraphs (a) and (b) of this Section 6.01 may be satisfied with respect to
financial information of the Borrower and its Subsidiaries by furnishing (i) the applicable financial statements of any Person of which the
Borrower is a Subsidiary (such Person, a “Parent Entity”) or (ii) the Borrower’s or a Parent Entity’s Form 10-K or 10-Q, as applicable, filed
with the SEC; provided that with respect to each of clauses (i) and (ii), (A) to the extent such information relates to a
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Parent Entity and there are material differences between the financial information at such Parent Entity and the Borrower, such information is
accompanied by such supplemental financial information (which need not be audited) as is necessary to eliminate the accounts of such Parent
Entity and each of its Subsidiaries, other than the Borrower and its Subsidiaries and (B) to the extent such information is in lieu of
information required to be provided under Section 6.01(a), such materials are accompanied by a report and opinion of such Parent Entity’s
auditor on the Closing Date, any other accounting firm of nationally or regionally recognized standing or another accounting firm reasonably
acceptable to the Administrative Agent, which report and opinion shall be prepared in accordance with generally accepted auditing standards
and shall not be subject to any explanatory statement as to the Borrower’s ability to continue as a “going concern” or like qualification or
exception (excluding any “emphasis of matter” paragraph), other than any such statement, qualification or exception resulting from or
relating to (i) an actual or anticipated breach of a Financial Covenant, (ii) an upcoming maturity date, (iii) activities, operations, financial
results or liabilities of any Person other than the Loan Parties and the Restricted Subsidiaries or (iv) changes in accounting principles or
practices. Any financial statements required to be delivered pursuant to this Section 6.01 shall not be required to contain purchase accounting
adjustments to the extent it is not practicable to include any such adjustments in such financial statements.
Section 6.02
Certificates; Other Information
. Deliver to the Administrative Agent for prompt further distribution by the Administrative Agent to each Lender each of the
following:
(a)
Compliance Certificate. No later than five (5) days after the delivery of the financial statements referred to in Sections
6.01(a) and 6.01(b), a duly completed Compliance Certificate.
(b)
SEC Filings. Promptly after the same are publicly available, copies of all annual, regular, periodic and special reports,
proxy statements and registration statements which Holdings or the Borrower or any Restricted Subsidiary files with the SEC (other than
amendments to any registration statement (to the extent such registration statement, in the form it became effective, is delivered to the
Administrative Agent), exhibits to any registration statement and, if applicable, any registration statement on Form S-8), and in any case not
otherwise required to be delivered to the Administrative Agent pursuant to any other clause of this Section 6.02; provided that
notwithstanding the foregoing, the obligations in this Section 6.02(b) may be satisfied by causing such information to be publicly available
on the SEC’s EDGAR website or another publicly available reporting service.
(c)
Information Regarding Collateral. The Borrower agrees to notify the Collateral Agent within forty-five (45) days (or
twenty calendar days as regards to a Canadian Loan Party or Collateral located in Canada) of such event of any change (or such later date as
the Collateral Agent may agree in its reasonable discretion),
(i)
(ii)
(iii)
(iv)
in the legal name of any Loan Party or any Person required to be a Loan Party;
in the identity or type of organization of any Loan Party or any Person required to be a Loan Party;
in the jurisdiction of organization of any Loan Party or any Person required to be a Loan Party;
in the location (within the meaning of Section 9-307 of the UCC or, if applicable, the PPSA) of any Loan
Party or any Person required to be a Loan Party under the UCC or the PPSA;
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(v)
in the location of any Collateral (other than (a) Collateral which consists of goods (as defined in the PPSA)
that are of a type that are normally used in more than one jurisdiction, if the goods are equipment or inventory leased or held for
lease by a Loan Party to others or (b) Collateral that has a fair market value of less than the Materiality Threshold Amount)
located in, or removed from, Canada to a jurisdiction in which no UCC or PPSA (as applicable) financing statement has
previously been filed.
(d)
Other Information. Such additional information as may be reasonably requested by the Administrative Agent or any
Lender through the Administrative Agent for purposes of compliance with applicable “know your customer” and anti-money laundering rules
and regulations, including the USA PATRIOT Act, and the Beneficial Ownership Regulation.
(e)
[reserved]
(f)
Borrowing Base Certificate. On or prior to the 20th calendar day after the last day of each calendar month (which, if
such day is not a Business Day, shall be delivered on the following Business Day) commencing with the calendar month ending November
30, 2021 (the period ending on each such date, a “Fiscal Month”), a Borrowing Base Certificate as of the close of business on the last day of
the immediately preceding Fiscal Month, together with such supporting information in connection therewith as the Administrative Agent may
reasonably request, which may include, (A) Inventory reports by category and location, (B) a reasonably detailed calculation of Eligible
Inventory, (C) a reasonably detailed calculation of Eligible Accounts Receivable and Eligible Credit Insured Accounts, and (D) a reasonably
detailed aging of the Loan Parties’ Accounts; provided that (1) during the continuance of a period beginning on the date that Specified Excess
Availability shall have been less than the greater of (x) 10.0% of the Line Cap and (y) $35,000,000 for five consecutive Business Days and
ending on the date that Specified Excess Availability shall have been at least the greater of (x) 10.0% of the Line Cap and (y) $35,000,000 for
20 consecutive calendar days, the Borrower shall deliver a Borrowing Base Certificate and such supporting information as the Administrative
Agent may reasonably request and as is reasonably practicable to provide on a weekly basis by the close of business on Thursday of each
week (or if Thursday is not a Business Day, on the next succeeding Business Day), as of the close of business on the immediately preceding
Friday, (2) during the continuance of a Specified ABL Event of Default and only for so long as a Specified ABL Event of Default is
continuing, the Borrower will be required to compute the Borrowing Base and deliver a Borrowing Base Certificate as frequently as
reasonably requested by the Administrative Agent (but not more frequently than as required in the preceding clause (1)), (3) any Borrowing
Base Certificate delivered other than with respect to a Fiscal Month’s end may be based on such estimates by the Borrower as the Borrower
may deem necessary and (4) any Borrowing Base Certificate which the Borrower elects to deliver more frequently than with respect to a
Fiscal Month’s end will be delivered at such increased frequency for at least 60 consecutive calendar days following the initial delivery
thereof; provided further, that a revised Borrowing Base Certificate based on the Borrowing Base Certificate most recently delivered shall be
delivered upon the consummation of a sale or other disposition (or merger, consolidation or amalgamation that constitutes a sale or
disposition) of any ABL Priority Collateral of a Loan Party to any Person other than a Loan Party outside the ordinary course of business
which results in a decrease in the Borrowing Base of at least $20 million at such time, together with such supporting information as may be
reasonably requested by the Administrative Agent.
Documents required to be delivered pursuant to Section 6.01 or Section 6.02 (other than Section 6.02(a)) may be delivered
electronically and if so delivered, shall be deemed to have been delivered on the date (i) on which the Borrower posts such documents, or
provides a link thereto, on the Borrower’s website on the Internet at the website addresses listed on Schedule 11.02, or (ii) on which such
documents are posted on the Borrower’s behalf on Merrill Datasite One, Intralinks/Intra Agency, Syndtrak or another relevant website, if any,
to which each Lender and the Administrative Agent have access (whether a
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commercial, third-party website or whether sponsored by the Administrative Agent); provided that: (A) upon written request by the
Administrative Agent, the Borrower shall deliver paper copies of such documents to the Administrative Agent for further distribution to each
Lender until a written request to cease delivering paper copies is given by the Administrative Agent and (B) the Borrower shall notify (which
may be by facsimile or electronic mail) the Administrative Agent of the posting of any such documents and provide to the Administrative
Agent by electronic mail electronic versions (i.e., soft copies) of such documents. Each Lender shall be solely responsible for timely
accessing posted documents or requesting delivery of paper copies of such documents from the Administrative Agent and maintaining its
copies of such documents.
The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Lead Arrangers will make available to the
Lenders materials and/or information provided by or on behalf of the Borrower hereunder (collectively, “Borrower Materials”) by posting
the Borrower Materials on Merrill Datasite One, Intralinks/Intra Agency, Syndtrak or another similar electronic system (the “Platform”) and
(b) certain of the Lenders may have personnel who do not wish to receive any information with respect to the Borrower or its Subsidiaries, or
the respective securities of any of the foregoing, that is not Public-Side Information, and who may be engaged in investment and other
market-related activities with respect to such Person’s securities. The Borrower hereby agrees that (i) all Borrower Materials that are to be
made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word
“PUBLIC” shall appear prominently on the first page thereof (and by doing so shall be deemed to have represented that such information
contains only Public-Side Information); (ii) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized
the Administrative Agent, the Lead Arrangers and the Lenders to treat such Borrower Materials as containing only Public-Side Information
(provided however, that to the extent such Borrower Materials constitute Information, they shall be treated as set forth in Section 11.08);
(iii) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public-Side
Information”; and (iv) the Administrative Agent and/or the Lead Arrangers shall be entitled to treat any Borrower Materials that are not
marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public-Side Information.”
For the avoidance of doubt, the foregoing shall be subject to the provisions of Section 11.08.
Section 6.03
Notices
. Promptly after a Responsible Officer obtains actual knowledge thereof, notify the Administrative Agent for prompt further
notification by the Administrative Agent to each Lender of:
(a)
the occurrence of any (i) Default or Event of Default or (ii) “Default” or “Event of Default” under and as defined in the
Term Loan Credit Agreement or the Senior Secured Notes Indenture; and
(b)
(i) any dispute, litigation, investigation or proceeding between the Borrower or any Restricted Subsidiary and any
arbitrator or Governmental Authority or (ii) the filing or commencement of, or any material development in, any litigation or proceeding
affecting the Borrower or any Restricted Subsidiary, or (iii) the occurrence of any ERISA Event or Canadian Pension Plan Event that, in any
such case referred to in clause (i) through (iii), has resulted, or is reasonably expected, individually or in the aggregate, to result in a Material
Adverse Effect.
Each notice pursuant to this Section 6.03 shall be accompanied by a written statement of a Responsible Officer of the Borrower
setting forth a summary description of the occurrence referred to therein and stating what action the Borrower has taken and proposes to take
with respect thereto. For the avoidance of doubt, the foregoing shall be subject to the provisions of Section 11.08.
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Section 6.04
Payment of Certain Taxes
. Timely pay, discharge or otherwise satisfy, as the same shall become due and payable, all obligations and liabilities in respect of
Taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or in respect of its property, except, in
each case, to the extent (a) any such Tax, assessment, charge or levy is being contested in good faith and by appropriate actions diligently
conducted and for which appropriate reserves have been established in accordance with GAAP or (b) the failure to pay, discharge or
otherwise satisfy the same has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse
Effect.
Section 6.05
Preservation of Existence, Etc.
(a)
Preserve, renew and maintain in full force and effect its legal existence under the Laws of the jurisdiction of its
incorporation or organization, as applicable; and
(b)
take all reasonable action to preserve, renew and keep in full force and effect those of its rights (including with respect
to Intellectual Property), licenses, permits, privileges, and franchises, that are material to the conduct of the business of the Loan Parties taken
as a whole;
except in the case of clause (a) or (b), (i) in connection with a transaction permitted by the Loan Documents (including transactions permitted
by Section 7.04 or Section 7.05), (ii) with respect to any Immaterial Subsidiary, or (iii) to the extent that failure to do so has not resulted in, or
is not reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 6.06
Maintenance of Properties
. Maintain, preserve and protect all of its material properties and equipment used in the operation of its business in good working
order, repair and condition (ordinary wear and tear excepted and casualty or condemnation excepted), except to the extent the failure to do so
has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 6.07
Maintenance of Insurance
.
(a)
(b)
(i)
Except when the failure to do so has not resulted in, or is not reasonably expected, individually or in the aggregate, to
result in a Material Adverse Effect, maintain or cause to be maintained with insurance companies that the Borrower believes (in
the good faith judgment of its management) are financially sound and reputable at the time the relevant coverage is placed or
renewed or with a Captive Insurance Subsidiary, insurance with respect to its properties and business against loss or damage of the
kinds customarily insured against by Persons engaged in the same or similar business and of such types and in such amounts (after
giving effect to any self-insurance) as are customarily carried under similar circumstances by such other Persons, and furnish to
the Administrative Agent, which, absent a continuing Event of Default, shall not be made more than once in any twelve month
period, upon reasonable written request from the Administrative Agent, information presented in reasonable detail as to the
insurance so carried.
Subject to Section 6.15, each such policy of insurance with respects to jurisdictions within the United States and Canada
shall as appropriate and is customary,
name the Collateral Agent, on behalf of the Secured Parties, as an additional insured thereunder (with respect to liability
insurance), or
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(ii)
to the extent covering Collateral in the case of property insurance, contain a lenders’ loss payable clause or endorsement
that names the Collateral Agent, on behalf of the Secured Parties, as the lenders’ loss payee thereunder;
provided that (A) absent a Specified Event of Default that is continuing, any proceeds of any such insurance shall be delivered by the
insurer(s) to Holdings, the Borrower or one of its Subsidiaries and may be applied in accordance with (or, if this Agreement does not provide
for application of such proceeds, in a manner that is not prohibited by) this Agreement and (B) this Section 6.07(b) shall not be applicable to
(1) business interruption insurance, workers’ compensation policies, employee liability policies or directors and officers policies, (2) policies
to the extent the Collateral Agent cannot have an insurable interest therein or is unable to be named as an additional insured or loss payee
thereunder or (3) the extent unavailable from the relevant insurer after the Borrower’s use of its commercially reasonable efforts.
Section 6.08
Compliance with Laws
. (a) Comply with the requirements of all Laws (including applicable ERISA-related laws, Canadian pension Laws and all
Environmental Laws) and all orders, writs, injunctions and decrees of any Governmental Authority applicable to it or to its business or
property, except to the extent the failure to comply therewith has not resulted in, or is not reasonably expected, individually or in the
aggregate, to result in a Material Adverse Effect and (b) comply in all material respects with the requirements of the USA PATRIOT Act, the
Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada), FCPA, the Corruption of Foreign Public Officials Act
(Canada), OFAC, UK Bribery Act of 2010 and other anti-terrorism, anti-corruption and anti-money laundering Laws; provided that the
requirements set forth in this Section 6.08, as they pertain to compliance by any Foreign Subsidiary with the USA PATRIOT ACT, the
Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada), FCPA, the Corruption of Foreign Public Officials Act
(Canada), OFAC and UK Bribery Act of 2010 are subject to and limited by any Law applicable to such Foreign Subsidiary in its relevant
local jurisdiction.
Section 6.09
Books and Records
. Maintain proper books of record and account in which entries that are full, true and correct in all material respects shall be made
of all material financial transactions and material matters involving the assets and business of the Borrower or such Restricted Subsidiary, as
the case may be (it being understood and agreed that Foreign Subsidiaries may maintain individual books and records in conformity with
generally accepted accounting principles in their respective countries of organization or operations and that such maintenance shall not
constitute a breach of the representations, warranties or covenants hereunder), in each case, to the extent necessary to prepare the financial
statements described in Sections 6.01(a) and 6.01(b).
Section 6.10
Inspection Rights
.
(a)
Permit representatives of the Administrative Agent and Required Lenders to visit and inspect any of its properties, to
examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom and to discuss its affairs,
finances and accounts with its directors, officers and independent public accountants (subject to such accountants’ policies and
procedures), all at the reasonable expense of the Borrower and at such reasonable times during normal business hours and as often
as may be reasonably desired, upon reasonable advance notice to the Borrower; provided that (a) excluding any such visits and
inspections during the continuation of an Event of Default, only the Administrative Agent on behalf of the Lenders may exercise
rights under this Section 6.10 and the Administrative Agent shall not exercise such rights more often than two times during any
calendar year absent the continuation of an Event of Default and only one such time shall be at the Borrower’s expense and (b)
when an Event of Default is continuing, the Administrative Agent or the Required Lenders (or any of their respective
representatives) may do any of the foregoing at the expense of the Borrower at any time during normal business hours and upon
reasonable advance notice. The Administrative Agent shall give the Borrower the
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(b)
opportunity to participate in any discussions with the Borrower’s independent public accountants. For the avoidance of
doubt, the foregoing shall be subject to the provisions of Section 11.08.
From time to time the Administrative Agent may conduct (or engage third parties to conduct) such field examinations,
verifications and evaluations as the Administrative Agent may deem reasonably necessary or appropriate; provided that, the
Administrative Agent (i) may conduct (x) one field examination and one inventory appraisal with respect to the Collateral in each
12-month period after the date of this Agreement and (y) one additional field examination and inventory appraisal with respect to
the Collateral in each consecutive 12-month period after the date Specified Excess Availability shall have been less than the
greater of (a) 15.0% of the Line Cap and (b) $50,000,000 for five or more consecutive Business Days, and (ii) may conduct such
other field examinations and inventory appraisals as frequently as determined by the Administrative Agent in its reasonable
discretion upon the occurrence and during the continuance of any Event of Default, in each case, in a form, and from a third party
appraiser or consultant, reasonably satisfactory to the Administrative Agent. All such appraisals, field examinations, inventory
appraisals and other verifications and evaluations shall be at the sole expense of the Loan Parties, and the Administrative Agent
shall provide the Borrower with a reasonably detailed accounting of all such expenses. The Loan Parties acknowledge that the
Administrative Agent, after exercising its rights of inspection, (x) may prepare and distribute to the Lenders certain Reports
pertaining to the Loan Parties’ assets for internal use by the Administrative Agent and the Lenders and (y) shall promptly
distribute copies of any final reports from a third party appraiser or third party consultant delivered in connection with any field
exam or appraisal to the Lenders, in each case of clauses (x) and (y), subject to the provisions of Section 11.08 hereof.
Section 6.11
Covenant to Guarantee Obligations and Give Security
. (a) At the Borrower’s expense, subject to any applicable limitation in any Loan Document (including Section 6.12), take the
following actions:
(i)
within ninety days of the occurrence of any Grant Event (or such longer period as the Administrative Agent
may agree in its reasonable discretion),
(A)
cause the Restricted Subsidiary subject of the Grant Event to execute and deliver the Guaranty (or
a joinder thereto), which may be accomplished by executing a Guaranty Supplement;
(B)
cause the Restricted Subsidiary subject of the Grant Event to execute and deliver the Security
Agreement (or a supplement thereto) or a Canadian Security Agreement (or a supplement thereto), as applicable, which
may be accomplished by executing a Security Agreement Supplement or a Canadian Security Agreement Supplement,
as applicable;
(C)
cause the Restricted Subsidiary subject of the Grant Event to execute and deliver any applicable
Intellectual Property Security Agreements with respect to its registered or applied for Intellectual Property constituting
Collateral;
cause the Restricted Subsidiary subject of the Grant Event to execute and deliver an
acknowledgement of the Closing Date ABL Intercreditor Agreement and any other applicable Intercreditor Agreement;
(D)
(E)
cause the Restricted Subsidiary subject of the Grant Event (and any Loan Party of which such
Restricted Subsidiary is a direct Subsidiary) to (1) if such Restricted Subsidiary is a corporation or has “opted into”
Article 8 of the Uniform Commercial Code
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(and with respect to an interest in a partnership organized under the laws of Canada, to the extent the terms of any such
interest expressly provide that such interest is a “security” for the purposes of the Securities Transfer Act (Ontario)),
deliver (or deliver to the Term Loan Agent in accordance with the Closing Date ABL Intercreditor Agreement) any and
all certificates representing its Equity Interests (to the extent certificated) that constitute Collateral and are required to
be delivered pursuant to the Security Agreement or the Canadian Security Agreement, as applicable, accompanied by
undated stock powers or other appropriate instruments of transfer executed in blank (or any other documents customary
under local law), (2) execute and deliver a counterparty signature page to the Global Intercompany Note (or a joinder
thereto), (3) deliver all instruments evidencing Indebtedness held by such Restricted Subsidiary that constitute
Collateral and are required to be delivered pursuant to the Security Agreement or the Canadian Security Agreement, as
applicable, endorsed in blank, to the Collateral Agent, and (4) if such Restricted Subsidiary is a Foreign Subsidiary,
deliver such additional security documents and enter into additional collateral arrangements in the jurisdiction of such
Foreign Subsidiary reasonably satisfactory to the Administrative Agent;
(F)
upon the reasonable request of the Administrative Agent, take and cause the Restricted Subsidiary
the subject of the Grant Event and each direct or indirect parent of such Restricted Subsidiary that is required to become
a Subsidiary Guarantor pursuant to this Agreement that directly holds Equity Interests in such Restricted Subsidiary to
take such customary actions as may be necessary in the reasonable opinion of the Administrative Agent to vest in the
Collateral Agent (or in any representative of the Collateral Agent designated by it) perfected Liens (subject to Permitted
Liens) in the Equity Interests of such Restricted Subsidiary and the personal property and fixtures of such Restricted
Subsidiary to the extent required by the Loan Documents, enforceable against all third parties in accordance with their
terms, except as such enforceability may be limited by applicable Debtor Relief Laws and by general principles of
equity (regardless of whether enforcement is sought in equity or at law);
(G)
upon request of the Administrative Agent deliver to the Administrative Agent a signed copy of a
customary opinion, addressed to the Administrative Agent and the other Secured Parties, of counsel for the Loan
Parties as to such matters set forth in this Section 6.11(a) as the Administrative Agent may reasonably request; provided
that such matters are not inconsistent with those addressed in opinions delivered on the Closing Date or customary
market practice;
provided that without limiting the obligations set forth above, the Administrative Agent and the Collateral Agent will consult in good faith
with the Borrower to reduce any stamp, filing or similar taxes imposed as a result of the actions described in the foregoing provisions;
Section 6.12
Further Assurances
. Subject to Section 6.11 and any applicable limitations in any Collateral Document, and in each case at the expense of the
Borrower, promptly upon the reasonable request by the Administrative Agent or Collateral Agent (a) correct any material defect or error that
may be discovered in the execution, acknowledgment, filing or recordation of any Collateral Document or other document or instrument
relating to any Collateral and (b) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register any and all such
further acts, deeds, certificates, assurances and other instruments as the Administrative Agent or Collateral Agent may reasonably request
from time to time in order to carry out more effectively the purposes of the Collateral Documents.
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Notwithstanding anything to the contrary in any Loan Document, other than with respect to the Equity Interests and assets of any
Foreign Subsidiary that becomes a Loan Party, neither Holdings, the Borrower, nor any Restricted Subsidiary will be required to, nor will the
Administrative Agent or the Collateral Agent be authorized,
(i)
to perfect security interests in the Collateral other than by,
(A)
“all asset” filings pursuant to (A) the Uniform Commercial Code in the office of the secretary of
state (or similar central filing office) of the relevant state(s) and (B) the PPSA in the applicable provinces and
territories;
(B)
filings in (A) the United States Patent and Trademark Office with respect to any U.S. issued or
applied for patents and registered or applied for trademarks and (B) the United States Copyright Office of the Library
of Congress with respect to material copyright registrations, and (C) the Canadian Intellectual Property Office with
respect to any Canadian Intellectual Property, in the case of each of (A) and (B), constituting Collateral;
(C)
[reserved]; and
(D)
delivery to the Administrative Agent or Collateral Agent (or a bailee of the Administrative Agent
or Collateral Agent in accordance with the Closing Date ABL Intercreditor Agreement) to be held in its possession of
all Collateral consisting of (1) certificates representing Pledged Equity, and (2) promissory notes and other instruments
constituting Collateral, in each case, in the manner provided in the Collateral Documents; provided that promissory
notes and instruments having an aggregate principal amount equal to the Materiality Threshold Amount or less need not
be delivered to the Collateral Agent;
(ii)
other than as set forth in Section 6.19 and in the definition of “Qualified Cash” or in relation to any Cash
Collateral arrangement required hereunder, to enter into any control agreement, blocked account agreement, lockbox or similar
arrangement with respect to any deposit account, securities account, commodities account or other bank account, or otherwise take
or perfect a security interest with control;
(iii)
except with respect to any Foreign Subsidiary designated as a Guarantor pursuant to the definition of
“Excluded Subsidiary” and the Equity Interests of such Foreign Subsidiary, to take any action (A) outside of the United States or
Canada with respect to any assets located outside of the United States or Canada, (B) in any non-U.S. or non-Canadian jurisdiction
or (C) required by the Laws of any non-U.S. or non-Canadian jurisdiction to create, perfect or maintain any security interest or
otherwise; or
(iv)
to take any action with respect to perfecting a Lien with respect to letters of credit, letter of credit rights,
commercial tort claims, chattel paper or assets subject to a certificate of title or similar statute (in each case, other than the filing of
customary “all asset” UCC-1 or PPSA financing statements) or except as set forth in the definition of Eligible Inventory to deliver
landlord lien waivers, estoppels, bailee letters or collateral access letters, in each case, unless required by the terms of the Security
Agreement, the Canadian Security Agreement or the relevant Collateral Document.
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(b)
Further, the Loan Parties shall not be required to perform any periodic collateral reporting, if any, with any frequency
greater than once per fiscal year (provided that this clause shall not limit the obligation of the Loan Parties to comply with Section 6.02(c) or
Section 6.11 or the Collateral Documents).
Section 6.13
Designation of Subsidiaries
. The Borrower may at any time designate any Restricted Subsidiary (other than a Co-Borrower) as an Unrestricted Subsidiary or designate
(or re-designate, as the case may be) any Unrestricted Subsidiary as a Restricted Subsidiary; provided that
(a)
immediately before and after such designation (or re-designation), no Specified Event of Default or Specified ABL
Event of Default shall have occurred and be continuing;
(b)
on a Pro Forma basis after giving effect to such designation, the Borrower is in compliance with the covenant set forth
is Section 8.01, regardless of whether such covenant is required to be tested at such time pursuant to the terms herein;
(c)
the Investment resulting from the designation of such Restricted Subsidiary as an Unrestricted Subsidiary as described
above is permitted by Section 7.02;
(d)
no Subsidiary may be designated as an Unrestricted Subsidiary unless it is also designated as an “unrestricted
subsidiary” under the Senior Secured Notes Indenture and the Term Loan Credit Agreement; and
(e)
if such designation (or re-designation) would result in a reduction in Excess Availability of 5.0% or more, the Borrower
shall submit an updated Borrowing Base Certificate at the time such designation (or re-designation) is made.
(f)
The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment by the Borrower therein
at the date of designation in an amount equal to the fair market value of the Borrower’s or its Restricted Subsidiary’s (as applicable)
Investment therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of
designation of any Indebtedness and Liens of such Subsidiary existing at such time and a return on any Investment by the Borrower in
Unrestricted Subsidiaries pursuant to the preceding sentence in an amount equal to the fair market value at the date of such designation of the
Borrower’s or its Restricted Subsidiary’s (as applicable) Investment in such Subsidiary. Except as set forth in this paragraph, no Investment
will be deemed to exist or have been made, and no Indebtedness or Liens shall be deemed to have been incurred or exist, by virtue of a
Subsidiary becoming an Excluded Subsidiary or an Excluded Subsidiary becoming a Restricted Subsidiary. For all purposes hereunder, the
designation of a Subsidiary as an Unrestricted Subsidiary shall be deemed to constitute a concurrent designation of any Subsidiary of such
Subsidiary as an Unrestricted Subsidiary.
Notwithstanding the foregoing, (i) no Restricted Subsidiary that owns material intellectual property shall be designated as an Unrestricted
Subsidiary pursuant to this Section 6.13 and (ii) no Unrestricted Subsidiary shall own any material intellectual property.
Section 6.14
[Reserved]
.
Section 6.15
Post-Closing Matters
. The Borrower will, and will cause each of its Restricted Subsidiaries to, take each of the actions set forth on Schedule 6.15
within the time period prescribed therefor on such schedule (as such time period may be extended by the Administrative Agent).
Section 6.16
Use of Proceeds
.
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(a)
The proceeds of Revolving Loans will be used for working capital and other general corporate purposes of the
Borrower and its Restricted Subsidiaries, including the financing of Permitted Acquisitions, Investments and other transactions, in each case,
that are not prohibited by the terms of this Agreement and that are not in violation of Sections 5.17 and 5.19; provided that the proceeds of
the Initial Revolving Borrowing will be used on the Closing Date as set forth in the definition of “Initial Revolving Borrowing”.
(b)
Letters of Credit will be used for general corporate purposes of the Borrower and its Restricted Subsidiaries, including
supporting transactions not prohibited by the Loan Documents, and will not be used in violation of Sections 5.17 and 5.19.
Section 6.17
Change in Nature of Business
. Engage only in material lines of business that are substantially consistent with those lines of business conducted by the Borrower
and the Restricted Subsidiaries on the Closing Date and lines of business that are reasonably similar, corollary, ancillary, incidental,
synergistic, complementary or related to, or a reasonable extension, development or expansion of, the businesses conducted or proposed to be
conducted by the Borrower and the Restricted Subsidiaries on the Closing Date, in each case as determined by the Borrower in good faith.
Section 6.18
[Reserved]
.
Section 6.19
Cash Receipts.
(a)
Annexed hereto as Schedule 6.19 is a schedule of all DDAs, Concentration Accounts and Excluded Accounts that, to
the knowledge of the Responsible Officers of the Loan Parties, are maintained by the Loan Parties as of the Closing Date, which Schedule
includes, with respect to each DDA, Concentration Account and Excluded Account, in each case as of the Closing Date, (i) the name and
address of the financial institution at which such DDA, Concentration Account or Excluded Account is maintained and (ii) the account
number(s) assigned to such DDAs, Concentration Accounts or Excluded Accounts by such financial institution.
(b)
Each Loan Party shall use its commercially reasonable efforts, within 90 days of the Closing Date (or such longer
period as may be agreed by the Administrative Agent in its reasonable discretion) (i) instruct each financial institution for a DDA to cause all
amounts on deposit and available at the close of each Business Day in such DDA (net of any Required Minimum Balance), to be swept to
one of the Loan Parties’ concentration accounts (each, a “Concentration Account”) no less frequently than on a daily basis, such
instructions to be irrevocable unless otherwise agreed to by the Administrative Agent; and (ii) use commercially reasonable efforts to enter
into or maintain an account control or blocked account agreement (each, a “Blocked Account Agreement”), in form reasonably satisfactory
to the Administrative Agent, with the Administrative Agent and any financial institution with which such Loan Party maintains (x) a
Specified DDA or (y) a Concentration Account into which the DDAs are swept (collectively, the “Blocked Accounts”). If such Blocked
Account Agreements cannot be put in place within 90 days after the Closing Date after any such Loan Party’s use of commercially
reasonable efforts, subject to extensions agreed to by the Administrative Agent, the Borrower shall be promptly required following the
expiration of such 90-day period and any extension thereof by the Administrative Agent to move the applicable accounts to accounts
maintained by the Administrative Agent or another bank that has executed such Blocked Account Agreements. In the event that any Loan
Party acquires or establishes any Specified DDA or Concentration Account after the Closing Date in connection with an Investment
permitted hereunder or otherwise that will, following the integration of such Specified DDA or Concentration Account into the cash
management procedures of the Borrower, constitute a Blocked Account, such Loan Party shall enter into a Blocked Account Agreement with
respect thereto (A) so long as no Cash Dominion Period exists, within 90 days, and (B) at any time a Cash Dominion Period exists, within ten
days, in each case following
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the date such Specified DDA or Concentration Account is acquired or established (or, in each case, such longer period as the Administrative
Agent may agree to in its reasonable discretion). For purposes of this Section 6.19, a Specified DDA or Concentration Account shall include
any related reinvestment account.
(c)
Each Blocked Account Agreement relating to any Concentration Account shall require, after the delivery of notice of a
Cash Dominion Period from the Administrative Agent to the Borrower and the other parties to such instrument or agreement (which the
Administrative Agent may, or upon the request of the Required Lenders shall, provide upon its becoming aware of such a Cash Dominion
Period), the ACH or wire transfer no less frequently than once per Business Day, of all available cash balances and cash receipts, including
the then contents or then entire ledger balance of each Blocked Account relating to any Concentration Account (net of such minimum
balance as may be required to be maintained in the subject Blocked Account by the bank at which such Blocked Account is maintained (the
“Required Minimum Balances”)), to an account maintained by the Administrative Agent (the “Administrative Agent Account”). All
amounts received in the Administrative Agent Account shall be applied (and allocated) by the Administrative Agent in accordance with
Section 2.07(b)(ii); provided that if the circumstances described in Section 9.03 are applicable, all such amounts shall be applied in
accordance with such Section 9.03. Each Loan Party agrees that it will not cause any proceeds of any Blocked Account relating to any
Concentration Account to be otherwise redirected. At all times, the Loan Parties shall maintain all of their cash and Cash Equivalents in (i)
Blocked Accounts, (ii) DDAs, (iii) Excluded Accounts or (iv) securities accounts subject to the control of the Administrative Agent, and at
any time a Cash Dominion Period exists and is continuing, amounts shall be swept from the Blocked Accounts relating to any Concentration
Account to the Administrative Agent Account as provided herein, except for Required Minimum Balances.
(d)
The Loan Parties may close DDAs or Blocked Accounts and/or open new DDAs or Blocked Accounts, subject (i) in
the case of opening any new DDAs, to the satisfaction of the requirements set forth in this Section 6.19 with respect to such new DDAs and
(ii) in the case of opening any new Blocked Accounts, to the execution and delivery to the Administrative Agent of a Blocked Account
Agreement consistent with the provisions of this Section 6.19 and otherwise reasonably satisfactory to the Administrative Agent within 90
days of the opening thereof (or such longer period as the Administrative Agent may agree in its reasonable discretion).
(e)
The Administrative Agent Account shall at all times be under the sole dominion and control of the Administrative
Agent. Each Loan Party hereby acknowledges and agrees that (i) such Loan Party has no right of withdrawal from the Administrative Agent
Account (except as provided in Section 2.07(b)(ii) or Section 9.03), (ii) the funds on deposit in the Administrative Agent Account shall at all
times continue to be collateral security for all of the Secured Obligations, and (iii) the funds on deposit in the Administrative Agent Account
shall be applied as provided in this Agreement and the Closing Date ABL Intercreditor Agreement. In the event that, notwithstanding the
provisions of this Section 6.19, any Loan Party receives or otherwise has dominion and control of any proceeds or collections required to be
transferred to the Administrative Agent Account pursuant to Section 6.19(c), such proceeds and collections shall be held in trust by such
Loan Party for the Administrative Agent, and shall promptly be deposited into the Administrative Agent Account or dealt with in such other
fashion as such Loan Party may be instructed by the Administrative Agent.
(f)
Upon the commencement of a Cash Dominion Period and for so long as the same is continuing, the Administrative
Agent may direct that all amounts in the Blocked Accounts which are Concentration Accounts be paid to the Administrative Agent
Account. So long as no Cash Dominion Period has commenced and is continuing in respect of which the Administrative Agent has delivered
notice as contemplated by paragraph (c) of this Section 6.19, the Loan Parties may direct, and shall have sole control over, the manner of
disposition of funds in the Blocked Accounts which are Concentration Accounts. So
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long as no Specified ABL Event of Default has occurred and is continuing, the Loan Parties may direct, and shall have sole control over, the
manner of disposition of funds in the Specified DDAs.
(g)
Any amounts held or received in the Administrative Agent Account (including all interest and other earnings with
respect thereto, if any) at any time (i) when the Revolving Commitment Termination Date has occurred or (ii) all Events of Default have been
cured and no Cash Dominion Period exists, shall (subject, in the case of clause (i), to the provisions of the Closing Date ABL Intercreditor
Agreement) be remitted to an account of the Borrower.
(h)
Following the commencement of a Cash Dominion Period (other than by reason of an Event of Default pursuant to
Section 9.01(a) or 9.01(f), except to the extent necessary for one or more officers or directors of Holdings, the Borrower or any of its
Subsidiaries to avoid personal or criminal liability under applicable Law as certified in the applicable Trust Fund Certificate), in the event
that a Blocked Account or the Administrative Agent Account contains Trust Funds (other than payroll and employee benefit payments, in
each case, in the nature of discretionary contributions), the Borrower (acting in good faith) may, within 30 days after such Trust Funds are
received in such Blocked Account or Administrative Agent Account, deliver to the Administrative Agent a Trust Fund Certificate (together
with such supporting information as may be reasonably requested by the Administrative Agent). Notwithstanding anything to the contrary
herein or in any other Loan Document, within five Business Days following receipt of a Trust Fund Certificate, the Administrative Agent
shall remit from such Blocked Account or Administrative Agent Account, as applicable, the lesser of (a) such Trust Funds specified in the
Trust Fund Certificate or (b) the Excess Availability on the date of such remittance, at the option of the Administrative Agent, (x) to the
applicable Loan Party or (y) on behalf of the applicable Loan Party directly to the Person entitled to such Trust Funds as specified in the
Trust Fund Certificate. If any such amounts are remitted to a Loan Party, such Loan Party shall apply all such funds solely for the purposes
set forth in the applicable Trust Fund Certificate on or prior to the date due and any failure of such Loan Party to apply all such funds solely
for such purposes shall constitute an immediate Event of Default.
ARTICLE VII.
NEGATIVE COVENANTS
So long as the Termination Conditions are not satisfied, the Borrower shall not (and, with respect to Section 7.10 only, Holdings
shall not), nor shall the Borrower permit any Restricted Subsidiary to:
Section 7.01
Liens
. Create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter
acquired, that secures Indebtedness other than the following:
(a)
Liens securing obligations in respect of Indebtedness incurred pursuant to Section 7.03(a), including obligations under
any Loan Document, Incremental Loans and Extended Loans;
(b)
Liens securing obligations in respect of Indebtedness incurred pursuant to Section 7.03(b), including obligations with
respect to the Senior Secured Notes Indenture and obligations with respect to the Term Loan Facility; provided, that any such Liens on ABL
Priority Collateral are at all times subject to the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that may be
executed from time to time and reasonably acceptable to the Administrative Agent that provides that such Liens shall rank on a junior lien
basis in respect of the ABL Priority Collateral to the Liens on the ABL Priority Collateral securing the Obligations;
(c)
Liens existing on the Closing Date (other than Liens incurred under Sections 7.01(a) and 7.01(b));
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(d)
Liens securing obligations in respect of Indebtedness permitted under Section 7.03(d), including in respect to
Attributable Indebtedness, Capitalized Lease Obligations, and Indebtedness financing the acquisition, construction, repair, replacement or
improvement of fixed or capital assets; provided that (i) such Liens attach concurrently with or within two hundred and seventy days after
completion of the acquisition, construction, repair, replacement or improvement (as applicable) of the property subject to such Liens and
(ii) such Liens do not at any time extend to or cover any assets (except for additions and accessions to such assets, replacements and products
thereof and customary security deposits) other than the assets subject to, or acquired, constructed, repaired, replaced or improved with the
proceeds of such Indebtedness; provided that individual financings of equipment provided by one lender may be cross collateralized to other
financings of equipment provided by such lender or its affiliates or branches;
(e)
(f)
Liens in favor of a Loan Party securing Indebtedness permitted under Section 7.03;
Liens securing (i) Obligations in respect of any Secured Hedge Agreement, (ii) obligations in respect of any Secured
Hedge Agreement (as defined in the Term Loan Credit Agreement) and (iii) other Indebtedness permitted by Section 7.03(f);
(g)
Liens on assets of Non-Loan Parties securing obligations of such Non-Loan Parties and Liens on Excluded Assets;
(h)
Liens securing obligations in respect of Permitted Pari Passu Secured Refinancing Debt or Permitted Junior Secured
Refinancing Debt and any Permitted Refinancing of any of the foregoing incurred pursuant to Section 7.03(h); provided, that any such Liens
on ABL Priority Collateral are at all times subject to the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that
may be executed from time to time and reasonably acceptable to the Administrative Agent that provides that such Liens shall rank on a junior
lien basis in respect of the ABL Priority Collateral to the Liens on the ABL Priority Collateral securing the Obligations;
(i)
Liens securing obligations in respect of Incremental Equivalent Debt (with the lien priority permitted in such definition
and other than to the extent such Indebtedness is only permitted to be incurred as unsecured Indebtedness) and other Indebtedness incurred
pursuant to Section 7.03(i); provided that such Liens securing such other Indebtedness are permitted by Section 7.01(ll)(i); provided, that,
subject to the penultimate paragraph of this Section 7.01, any such Liens on ABL Priority Collateral in respect thereof are at all times subject
to the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that may be executed from time to time and
reasonably acceptable to the Administrative Agent;
(j)
Liens securing obligations in respect of Permitted Ratio Debt (with the lien priority permitted in such definition and
other than to the extent such Indebtedness is only permitted to be incurred as unsecured Indebtedness) and other Indebtedness permitted by
Sections 7.03(j); provided that such Liens securing such other Indebtedness are permitted by Section 7.01(ll)(i); provided, that, subject to the
penultimate paragraph of this Section 7.01, any such Liens on ABL Priority Collateral in respect thereof are at all times subject to the Closing
Date ABL Intercreditor Agreement or any other intercreditor agreement that may be executed from time to time and reasonably acceptable to
the Administrative Agent;
(k)
Liens on property or assets contributed to capital of the Borrower or a Subsidiary Guarantor or received in exchange for
Equity Interests of the Borrower or a Parent Entity made after the Closing Date solely to the extent Not Otherwise Applied;
(l)
(i) Liens existing on property (other than Accounts and Inventory of Loan Parties, unless such Liens are expressly made
junior to the Liens securing the Obligations hereunder) at the time of (and
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not in contemplation of) its acquisition or existing on the property of any Person or on Equity Interests of any Person, in each case, at the
time such Person becomes (and not in contemplation of such Person becoming) a Restricted Subsidiary, in each case after the Closing Date;
provided that (A) such Lien does not extend to or cover any other assets or property (other than (1) after-acquired property covered by any
applicable grant clause, (2) property that is affixed or incorporated into the property covered by such Lien and (3) proceeds and products of
assets covered by such Liens), (B) such Lien does not encumber any assets of the Borrower or its Restricted Subsidiaries other than the assets
acquired in such transaction and (C) the Indebtedness secured thereby is permitted under Section 7.03, (ii) Liens on any cash earnest money
deposits made by the Borrower or any of the Restricted Subsidiaries in connection with any letter of intent or purchase agreement relating to
an Investment and (iii) Liens incurred in connection with escrow arrangements or other agreements relating to an Acquisition Transaction or
Investment permitted hereunder;
(m)
Liens (i) on cash advances in favor of the seller of any property to be acquired in an Investment permitted pursuant to
Section 7.02 to be applied against the purchase price for such Investment or (ii) consisting of an agreement to Dispose of any property in a
Disposition, in each case, solely to the extent such Investment or Disposition, as the case may be, would have been permitted on the date of
the creation of such Lien;
(n)
(i) pledges or deposits in the ordinary course of business in connection with workers’ compensation, health, disability
or employee benefits, unemployment insurance and other social security laws or similar legislation or regulation or other insurance-related
obligations (including in respect of deductibles, self-insured retention amounts and premiums and adjustments thereto) and (ii) pledges and
deposits in the ordinary course of business securing liability for reimbursement 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
Holdings, the Borrower or any Restricted Subsidiaries;
(i) Liens on insurance policies and the proceeds thereof securing the financing of the premiums with respect thereto and
(ii) Liens on cash securing obligations to insurance companies with respect to insurable liabilities incurred in the ordinary course of business;
(o)
(p)
deposits to secure the performance of bids, trade contracts, governmental contracts and leases (other than Indebtedness
for borrowed money), statutory obligations, surety, stay, customs and appeal bonds, performance bonds and other obligations of a like nature
(including those to secure health, safety and environmental obligations) incurred in the ordinary course of business;
(q)
(r)
Liens on the Securitization Assets arising in connection with a Qualified Securitization Financing;
Liens in respect of the cash collateralization of letters of credit;
(s)
Liens (i) of a collection bank arising under Section 4-208 or 4-210 of the Uniform Commercial Code on the items in the
course of collection, (ii) attaching to commodity trading accounts or other commodities brokerage accounts incurred in the ordinary course of
business and not for speculative purposes and (iii) in favor of a banking or other financial institution arising as a matter of law encumbering
deposits or other funds maintained with a financial institution (including the right of setoff) and that are within the general parameters
customary in the banking industry;
(t)
Liens securing Cash Management Obligations and Cash Management Obligations (as defined in the Term Loan Credit
Agreement), in each case, as permitted by Section 7.03;
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(u)
Liens that are customary contractual rights of setoff (i) relating to the establishment of depository relations with banks
or other deposit-taking financial institutions in the ordinary course of business (and, for the avoidance of doubt, not given in connection with
the issuance of Indebtedness), (ii) relating to pooled deposit or sweep accounts of Holdings, the Borrower or any of the Restricted
Subsidiaries to permit satisfaction of overdraft or similar obligations incurred in the ordinary course of business or (iii) relating to purchase
orders and other agreements entered into with customers of the Borrower or any of the Restricted Subsidiaries in the ordinary course of
business;
(v)
statutory or common law Liens of landlords, carriers, warehousemen, mechanics, materialmen, repairmen, construction
contractors or other like Liens, or other customary Liens (other than in respect of Indebtedness) in favor of landlords, so long as, in each case,
such Liens arise in the ordinary course of business and secure amounts not overdue for a period of more than sixty days or, if more than sixty
days overdue, are unfiled and no other action has been taken to enforce such Lien or that are being contested in good faith and by appropriate
actions, if adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance with GAAP;
(w)
any interest or title of a lessor, sublessor, licensor or sublicensor or secured by a lessor’s, sublessor’s, licensor’s or
sublicensor’s interest under leases or licenses entered into by the Borrower or any of the Restricted Subsidiaries as lessee or licensee in the
ordinary course of business;
(x)
ground leases in respect of real property on which facilities owned or leased by the Borrower or any of its Subsidiaries
are located;
(y)
any zoning or similar law or right reserved to or vested in any Governmental Authority to control or regulate the use of
any real property that does not materially interfere with the ordinary conduct of the business of the Borrower and the Restricted Subsidiaries,
taken as a whole;
(z)
deposits of cash with the owner or lessor of premises leased and operated by the Borrower or any of the Restricted
Subsidiaries in the ordinary course of business to secure the performance of the Borrower’s or a Restricted Subsidiary’s obligations under the
terms of the lease for such premises;
(aa)
(i) Liens for taxes, assessments or governmental charges that are not overdue for a period of more than sixty days or
that are being contested in good faith and by appropriate actions diligently conducted and for which appropriate reserves have been
established in accordance with GAAP or that are not expected to result in a Material Adverse Effect and (ii) Liens for property taxes on
property the Borrower or its Subsidiaries has decided to abandon if the sole recourse for such tax, assessment or charge is to such property;
(bb)
easements, rights-of-way, restrictions (including zoning restrictions), encroachments, protrusions and other similar
encumbrances and title defects affecting real property that, in the aggregate, do not in any case materially interfere with the ordinary conduct
of the business of the Borrower and the Restricted Subsidiaries taken as a whole, or the use of the property for its intended purpose and any
other exceptions to title on any mortgage policy pursuant to the Term Loan Credit Agreement;
(cc)
Liens arising from judgments or orders for the payment of money not constituting an Event of Default under
Section 9.01(g);
(dd)
leases, licenses, subleases or sublicenses granted to others in the ordinary course of business (including any other
agreement under which the Borrower or any Restricted Subsidiary has granted rights to end users to access and use the Borrower’s or any
Restricted Subsidiary’s products, technologies,
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facilities or services) which do not interfere in any material respect with the business of the Borrower and the Restricted Subsidiaries, taken
as a whole;
(ee)
Liens (i) in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in
connection with the importation of goods in the ordinary course of business and (ii) on specific items of inventory or other goods and
proceeds thereof of any Person securing such Person’s obligations in respect of bankers’ acceptances or documentary letters of credit issued
or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or such other goods in the ordinary
course of business;
(ff)
Liens arising out of conditional sale, title retention, consignment or similar arrangements for sale of goods entered into
by the Borrower or any of the Restricted Subsidiaries in the ordinary course of business;
(gg)
Liens imposed by law or incurred pursuant to customary reservations or retentions of title (including contractual Liens
in favor of sellers and suppliers of goods) incurred in the ordinary course of business for sums not constituting borrowed money that are not
overdue for a period of more than sixty days or that are being contested in good faith by appropriated proceedings and for which adequate
reserves have been established in accordance with GAAP (if so required);
(hh)
Liens deemed to exist in connection with Investments in repurchase agreements and reasonable customary initial
deposits and margin deposits and similar Liens attaching to commodity trading accounts or other brokerage accounts maintained in the
ordinary course of business and not for speculative purposes;
(ii)
Liens on cash and Cash Equivalents earmarked to be used to satisfy or discharge Indebtedness where such satisfaction
or discharge of such Indebtedness is not otherwise prohibited by this Agreement;
(jj)
purported Liens evidenced by the filing of precautionary Uniform Commercial Code or PPSA financing statements or
similar public filings;
(kk)
the modification, replacement, renewal or extension of any Lien permitted by this Section 7.01; provided that (i) the
Lien does not extend to any additional property, other than (A) after-acquired property covered by any applicable grant clause, (B) property
that is affixed or incorporated into the property covered by such Lien and (C) proceeds and products of assets covered by such Liens, and
(ii) the renewal, extension or refinancing of the obligations secured or benefited by such Liens is permitted by Section 7.03;
(ll)
Liens securing:
(i)
a Permitted Refinancing of Indebtedness; provided that:
(A)
(B)
(C)
such Indebtedness was permitted by Section 7.03 and was secured by a Permitted Lien;
such Permitted Refinancing is permitted by Section 7.03; and
the Lien does not extend to any additional property, other than (A) after-acquired property covered
by any applicable grant clause, (B) property that is affixed or
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incorporated into the property covered by such Lien and (C) proceeds and products of assets covered by such Liens;
and
(ii)
Guarantees permitted by Sections 7.03 to the extent that the underlying Indebtedness subject to such
Guarantee is permitted to be secured by a Lien;
(mm)
Liens securing Pari Passu Lien Debt and/or Junior Lien Debt; provided that:
(i)
such Indebtedness is incurred pursuant to clause (a)(i) or (a)(ii) of the definition of “Permitted Ratio Debt”;
and
(ii)
such Liens (other than with respect to purchase money and similar obligations) are, in each case, subject to
the penultimate paragraph of this Section 7.01, to the extent such Indebtedness is required to be subject to the provisions of the
Closing Date ABL Intercreditor Agreement, a Debt Representative acting on behalf of the holders of such Indebtedness has
become party to, or is otherwise subject to the provisions of the Closing Date ABL Intercreditor Agreement or any other
intercreditor agreement that may be executed from time to time and reasonably acceptable to the Administrative Agent;
(nn)
Liens securing Indebtedness or other obligations in an aggregate principal amount as of the date such Indebtedness is
incurred not to exceed the greater of (A) 25.00% of Closing Date EBITDA and (B) 25.00% of TTM Consolidated Adjusted EBITDA as of
the applicable date of determination, in each case, determined as of the date such Indebtedness is incurred (or commitments with respect
thereto are received); provided that it is agreed that Liens incurred pursuant to this clause (nn) may be pari passu with the Liens securing the
Term Loan Obligations; provided, further, that, subject to the penultimate paragraph of this Section 7.01, any Liens on ABL Priority
Collateral in respect thereof are at all times subject to the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement
that may be executed from time to time and reasonably acceptable to the Administrative Agent;
(oo)
Liens in respect of the cash collateralization of corporate credit card programs; provided that the aggregate amount of
such cash securing such obligations shall not exceed $15,000,000; and
(pp)
Liens arising under the Pension Benefits Act (Ontario) or other applicable pension standards legislation in Canada in
respect of pension plan contribution amounts not yet due.
Notwithstanding the foregoing, any Indebtedness secured by a Lien on ABL Priority Collateral pursuant to clauses (i), (j), (mm)
and (nn) above, that is not subject to the Closing Date ABL Intercreditor Agreement or another Intercreditor Agreement that provides that
such Liens shall rank on a junior lien basis in respect of the ABL Priority Collateral to the Liens on the ABL Priority Collateral securing the
Obligations, shall not exceed $5 million in the aggregate at any time outstanding; provided that the Borrower shall provide prior written
notice to the Administrative Agent prior to incurring such Lien; provided further that the Administrative Agent may impose a Reserve with
respect to the aggregate amount of Obligations secured by such Liens.
For purposes of determining compliance with this Section 7.01, in the event that any Lien (or any portion thereof) meets the
criteria of more than one of the categories set forth above, the Borrower may, in its sole discretion, at the time of incurrence, divide, classify
or reclassify, or at any later time divide, classify or reclassify, such Lien (or any portion thereof) in any manner that complies with this
covenant on the date such Lien is incurred or such later time, as applicable; provided that all Liens securing Indebtedness under (a) the Loan
Documents will be deemed to have been incurred in reliance on the exception in Section 7.01(a) and (b) the Senior Secured Notes Indenture
and the Term Loan Credit Agreement, in each
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case on the Closing Date will be deemed incurred in reliance on the exception in Section 7.01(b), and shall not be permitted to be reclassified
pursuant to this paragraph. With respect to any Liens securing Indebtedness that was permitted to be incurred hereunder on the date of such
incurrence, any Lien securing the Increased Amount of such Indebtedness shall also be permitted hereunder after the date of such incurrence.
Section 7.02
Investments
. Make any Investments, except:
(a)
Investments:
(i)
by the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary; and
(ii)
by the Borrower or any Restricted Subsidiary in a Person, if as a result of such Investment (A) such Person
becomes a Restricted Subsidiary or (B) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Borrower or a Restricted Subsidiary;
provided, that the Investments pursuant to this clause (a) by a Loan Party in any Non-Loan Party, together with any Permitted Acquisitions
pursuant to 7.02(c) of any entity that is not (or does not become) a Loan Party, shall not exceed the greater of (i) 50.00% of Closing Date
EBITDA and (ii) 50.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination;
(b)
Investments existing on the Closing Date or made pursuant to legally binding written contracts in existence on the
Closing Date and any modification, replacement, renewal, reinvestment or extension of any of the foregoing; provided that the amount of any
Investment permitted pursuant to this Section 7.02(b) is not increased from the amount of such Investment on the Closing Date except
pursuant to the terms of such Investment as of the Closing Date or as otherwise permitted by another clause of this Section 7.02;
(c)
Permitted Acquisitions; provided that the aggregate amount of any Permitted Acquisition pursuant to this Section
7.02(c) of any entity that is not (or does not become) a Loan Party, together with Investments pursuant to Section 7.02(a) in any Restricted
Subsidiaries that are not Loan Parties, does not exceed in the aggregate the greater of (i) 50.00% of Closing Date EBITDA and (ii) 50.00% of
TTM Consolidated Adjusted EBITDA as of the applicable date of determination;
(d)
Investments (i) held by a Restricted Subsidiary acquired after the Closing Date or of a Person merged, amalgamated or
consolidated with or into the Borrower or merged, amalgamated or consolidated with or into a Restricted Subsidiary (or committed to be
made by any such Person) to the extent that, in each case, such Investments or any such commitments 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,
amalgamation or consolidation and (ii) held by Persons that become Restricted Subsidiaries after the Closing Date, including Investments by
Unrestricted Subsidiaries made or acquired (or committed to be made or acquired), to the extent that such Investments were not made or
acquired (or committed to be made or acquired) in contemplation of, or in connection with, such Person becoming a Restricted Subsidiary or
such designation as applicable;
(e)
Investments in Similar Businesses that do not exceed in the aggregate the greater of (i) 25.00% of Closing Date
EBITDA and (ii) 25.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination; provided that if any Investment
pursuant to this clause (e) is made in any Person that is not the Borrower or a Restricted Subsidiary on the date of such Investment (prior to
giving
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effect thereto) and such Person subsequently becomes the Borrower or a Restricted Subsidiary, the Investment initially made in such Person
pursuant to this clause (e) shall thereupon be deemed to have been made pursuant to clause (a)(i) hereof and to not have been made pursuant
to this clause (e) for so long as such Person continues to be the Borrower or a Restricted Subsidiary;
(f)
(g)
[reserved];
Investments to the extent that payment for such Investments is made solely with Qualified Equity Interests of Holdings
(or any Parent Entity) or the proceeds from the issuance thereof;
(h)
Joint Venture Investments;
(i)
loans and advances to Holdings (or any Parent Entity) in lieu of, and not in excess of the amount of (after giving effect
to any other loans, advances or Restricted Payments in respect thereof) Restricted Payments permitted to be made to Holdings (or such Parent
Entity) in accordance with Section 7.06;
(j)
loans or advances to any Company Person;
(i)
for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary
business purposes;
(ii)
in connection with such Person’s purchase of Equity Interests of Holdings (or any Parent Entity); provided
that, to the extent such loans or advances are made in cash, the amount of such loans and advances used to acquire such Equity
Interests shall be contributed to Holdings in cash; and
(iii)
for any other purpose; provided that either (A) no cash or Cash Equivalents are advanced in connection with
such Investment or (B) the aggregate principal amount outstanding under this clause (iii)(B) shall not exceed the greater of (1)
10.00% of Closing Date EBITDA and (2) 10.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of
determination;
(k)
Investments in Hedge Agreements;
(l)
constituting a Disposition;
promissory notes and other Investments received in connection with Dispositions or any other transfer of assets not
(m)
Investments in assets that are cash or Cash Equivalents or were Cash Equivalents when made;
(n)
Investments consisting of extensions of trade credit or otherwise made in the ordinary course of business, including
Investments consisting of endorsements for collection or deposit and trade arrangements with customers, vendors, suppliers, licensors and
licensees;
(o)
Investments consisting of Liens, Indebtedness (including Guarantees), fundamental changes, Dispositions and
Restricted Payments permitted under Sections 7.01, 7.03, 7.04 (other than clause (f) thereof), 7.05 (other than clause (e) thereof) and 7.06
(other than clauses (d) and (h)(iv) hereof), respectively;
(p)
Investments (i) received in connection with the bankruptcy, workout, recapitalization or reorganization of, or in
settlement of delinquent obligations of, or other disputes with, any other Person
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who is not an Affiliate of the Borrower, (ii) received in connection with the foreclosure of any secured Investment or other transfer of title
with respect to any secured Investment, (iii) in satisfaction of judgments against other Persons who are not Affiliates of the Borrower, (iv) as
a result of the settlement, compromise or resolutions of litigation, arbitration or other disputes with Persons who are not Affiliates of the
Borrower and (v) received in satisfaction or partial satisfaction of trade credit and other credit extended in the ordinary course of business,
including to vendors and suppliers;
(q)
(r)
advances of payroll or other payments to any Company Person;
Investments consisting of purchases and acquisitions of inventory, supplies, material, services or equipment or the
licensing or contribution of Intellectual Property pursuant to joint marketing arrangements with other Persons;
(s)
Investments made in connection with obtaining, maintaining or renewing client contracts and loans or advances made
to distributors, vendors, suppliers, licensors and licensees;
thereby;
(t)
(u)
(v)
Guarantees of leases (other than Capitalized Leases) or of other obligations that do not constitute Indebtedness;
Investments in connection with any Permitted Reorganization and the transactions relating thereto or contemplated
Investments in connection with any deferred compensation plan or arrangement or other compensation plan or
arrangement, including to a “rabbi” trust or to any grantor trust claims of creditors;
(w)
in the event that the Borrower or any Restricted Subsidiary makes any Investment after the Closing Date in any Person
that is not a Restricted Subsidiary and such Person subsequently becomes a Restricted Subsidiary, additional Investments in an amount equal
to the fair market value of such Investment as of the date on which such Person becomes a Restricted Subsidiary;
(x)
[reserved];
(y)
contributions to Canadian Pension Plans, Canadian Multi-Employer Pension Plans and the Pension Plans or the
payment of any other employee benefit plan obligations and liabilities, except to the extent that such obligations and/or liabilities, as
applicable, are permitted to remain unfunded under applicable law;
(z)
Investments in connection with intercompany cash management services, treasury arrangements and any related
activities;
(aa)
Investments consisting of (i) the licensing or contribution of Intellectual Property pursuant to joint marketing,
collaborations or other similar arrangements with other Persons and/or (ii) minority equity interests in customers received as part of fee
arrangements or other commercial arrangements;
(bb)
the conversion to Qualified Equity Interests of any Indebtedness owed by the Borrower or any Restricted Subsidiary;
(cc)
(i) Investments in a Securitization Subsidiary or any Investment by a Securitization Subsidiary in any other Person in
connection with a Qualified Securitization Financing; provided however, that any such Investment in a Securitization Subsidiary is of
Securitization Assets or equity, and
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(ii) distributions or payments of Securitization Fees and purchases of Securitization Assets pursuant to a Securitization Repurchase
Obligation in connection with a Qualified Securitization Financing;
(dd)
(ee)
(ff)
(gg)
[reserved];
[reserved];
[reserved];
Investments made pursuant to the Acquisition Agreement in connection with the Transactions on, or substantially
concurrent with, the Closing Date;
(hh)
(ii)
[reserved];
Investments that do not exceed in the aggregate at any time outstanding the greater of (A) 30% of Closing Date
EBITDA and (B) 30% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination.
(jj)
use of proceeds thereof).
Investments, so long as the Payment Conditions are satisfied (after giving Pro Forma Effect to such Investment and the
If any Investment is made in any Person that is not a Restricted Subsidiary on the date of such Investment and such Person
subsequently becomes a Restricted Subsidiary, such Investment shall thereupon be deemed to have been made pursuant to Section 7.02(a)(i)
and to not have been made pursuant to any other clause set forth above.
Notwithstanding the foregoing, none of Holdings, the Borrower or any Restricted Subsidiary shall transfer (whether by sale,
contribution, dividend or otherwise), material intellectual property to any Unrestricted Subsidiary.
For purposes of determining compliance with this Section 7.02, in the event that any Investment (or any portion thereof) meets the
criteria of more than one of the categories set forth above, the Borrower may, in its sole discretion, at the time such Investment is made,
divide, classify or reclassify, or at any later time divide, classify or reclassify, such Investment (or any portion thereof) in any manner that
complies with this covenant on the date such Investment is made or such later time, as applicable; provided that such Investments shall not be
permitted to be reclassified to Section 7.02(jj).
The amount of any Investment at any time shall be the amount of cash and the fair market value of other property actually invested
(measured at the time made), without adjustment for subsequent changes in the value of such Investment at the Borrower’s option, net of any
return, whether a return of capital, interest, dividend or otherwise, with respect to such Investment. To the extent any Investment in any
Person is made in compliance with this Section 7.02 in reliance on a category above that is subject to a Dollar-denominated restriction on the
making of Investments and, subsequently, such Person returns to the Borrower or any Restricted Subsidiary all or any portion of such
Investment (in the form of a dividend, distribution, liquidation or otherwise, but excluding intercompany Indebtedness), such return shall be
deemed to be credited to the Dollar-denominated category against which the Investment is then charged. To the extent the category subject to
a Dollar-denominated restriction is also subject to a percentage of TTM Consolidated Adjusted EBITDA restriction which, at the date of
determination, produces a numerical restriction that is greater than such Dollar Amount, then such Dollar equivalent shall be deemed to be
substituted in lieu of the corresponding Dollar Amount in the foregoing sentence for purposes of determining such credit.
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For purposes of determining compliance with any Dollar-denominated (or percentage of TTM Consolidated Adjusted EBITDA, if
greater) restriction on the making of Investments, the Dollar equivalent amount of the Investment denominated in a foreign currency shall be
calculated based on the relevant currency exchange rate in effect on the date such Investment was made.
Section 7.03
Indebtedness
. Create, incur or assume any Indebtedness, other than:
(a)
(b)
Indebtedness under the Loan Documents (including Incremental Loans and Extended Loans);
Indebtedness in respect of
(i)
(A) the Senior Secured Notes Documents incurred on the Closing Date in an aggregate principal amount not
to exceed $775,000,000 and (B) any Permitted Refinancing in respect thereof;
(ii)
(A) the Term Loan Documents in an aggregate principal amount not to exceed the sum of (x) $525,000,000,
plus (y) $250,000,000 of Delayed Draw Term Loans (as defined in the Term Loan Credit Agreement) plus (z) the Incremental
Amount (as defined in the Term Loan Credit Agreement as in effect on the Closing Date) and any Permitted Refinancing in
respect of the foregoing;
(c)
Indebtedness existing on the Closing Date (other than Indebtedness under the Senior Secured Notes Indenture and the
Term Loan Credit Agreement) and any Permitted Refinancing thereof, including any intercompany Indebtedness of Holdings, the Borrower
or any Restricted Subsidiary outstanding on the Closing Date;
(d)
(i) (A) Attributable Indebtedness relating to any transaction, (B) Capitalized Leases and other Indebtedness financing
the acquisition, construction, repair, replacement or improvement of fixed or capital assets, whether through the direct purchase of assets or
the Equity Interests of any Person owning such assets, so long as such Indebtedness is incurred concurrently with, or within two-hundred and
seventy days after, the applicable acquisition, construction, repair, replacement or improvement and (C) Indebtedness arising from the
conversion of obligations of the Borrower or any Restricted Subsidiary under or pursuant to any “synthetic lease” transactions to
Indebtedness of the Borrower or such Restricted Subsidiary; provided that the aggregate principal amount of such Indebtedness at the time
any such Indebtedness is incurred pursuant to this Section 7.03(d) shall not exceed the greater of (I) 25.00% of Closing Date EBITDA and
(II) 25.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination, in each case determined at the time of
incurrence, (ii) Attributable Indebtedness incurred in connection with a Sale Leaseback Transaction otherwise permitted hereunder and
(iii) any Permitted Refinancing of any Indebtedness incurred under this Section 7.03(d); provided that for the purposes of determining
compliance with this Section 7.03(d), any lease that is not treated under GAAP as a capital lease at the time such lease is executed but is
subsequently treated under GAAP as a capitalized lease as the result of a change in GAAP (or interpretations thereof) after the Closing Date
shall not be treated as Indebtedness;
(e)
Indebtedness of the Borrower or any of the Restricted Subsidiaries owing to the Borrower or any other Restricted
Subsidiary; provided that all such Indebtedness of any Loan Party owed to any Restricted Subsidiary that is not a Loan Party shall be subject
to the Global Intercompany Note (but only to the extent permitted by applicable Law);
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(f)
Indebtedness in respect of (i) Obligations under Secured Hedge Agreements, (ii) obligations under Secured Hedge
Agreements (as defined in the Term Loan Credit Agreement) and (iii) Hedge Agreements designed to hedge against Holdings’, the
Borrower’s or any Restricted Subsidiary’s exposure to interest rates, foreign exchange rates or commodities pricing risks, in each case of
clauses (i) through (iii), incurred not for speculative purposes, and Guarantees thereof;
(g)
(i) Indebtedness incurred by a Non-Loan Party in an aggregate amount which does not exceed the greater of (A)
25.00% of Closing Date EBITDA and (B) 25.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination and
(ii) Indebtedness that is recourse only to Excluded Assets;
(h)
(i)
(j)
(k)
(l)
Credit Agreement Refinancing Indebtedness and any Permitted Refinancing thereof;
Incremental Equivalent Debt and any Permitted Refinancing thereof;
Permitted Ratio Debt and any Permitted Refinancing thereof;
Contribution Indebtedness and any Permitted Refinancing thereof;
Indebtedness,
(i)
of any Person that becomes a Restricted Subsidiary after the Closing Date pursuant to an Investment or other
Acquisition Transaction permitted hereunder, which Indebtedness is existing at the time such Person becomes a Restricted
Subsidiary and is not incurred in contemplation of such Person becoming a Restricted Subsidiary that is non-recourse to (and is
not assumed by any of) the Borrower, Holdings or any Restricted Subsidiary (other than any Subsidiary of such Person that is a
Subsidiary on the date such Person becomes a Restricted Subsidiary after the Closing Date) and is either (A) unsecured or (B)
secured only by the assets of such Restricted Subsidiary by Liens permitted under Section 7.01; provided, that immediately after
giving effect to the or assumption of such Indebtedness, the Total Net Leverage Ratio for the applicable Test Period is equal to or
less than (1) the Closing Date Total Net Leverage Ratio or (2) the Total Net Leverage Ratio immediately prior to such assumption;
(ii)
any Permitted Refinancing of any of the foregoing;
(m)
Indebtedness incurred in connection with a Permitted Acquisition, Acquisition Transaction or Investment expressly
permitted hereunder or any Disposition, in each case to the extent constituting indemnification obligations or obligations in respect of
purchase price (including earn-outs and seller notes) or other similar adjustments;
(n)
Indebtedness representing deferred compensation to employees of the Borrower and its Subsidiaries incurred in the
ordinary course of business;
(o)
Indebtedness consisting of obligations of the Borrower and the Restricted Subsidiaries under deferred compensation or
other similar arrangements with employees incurred by such Person in connection with the Transactions, Permitted Acquisitions, Acquisition
Transaction or any Investment expressly permitted hereunder (other than pursuant to Section 7.02(o));
(p)
Indebtedness to current or former officers, directors, managers, consultants, and employees, their respective estates,
spouses or former spouses to finance the purchase or redemption of Equity Interests of Holdings (or any Parent Entity) permitted by Section
7.06;
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(q)
Indebtedness in respect of letters of credit, bank guarantees, bankers’ acceptances, warehouse receipts or similar
instruments issued or created in the ordinary course of business, including such Indebtedness that is consistent with past practices in respect
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 and letters of credit that are cash
collateralized;
(r)
Indebtedness consisting of (i) the financing of insurance premiums or (ii) take-or-pay obligations contained in supply
arrangements, in each case, incurred in the ordinary course of business;
(s)
obligations in respect of performance, bid, appeal and surety bonds and performance and completion guarantees and
similar obligations provided by the Borrower or any of the Restricted Subsidiaries or obligations in respect of letters of credit, bank
guarantees or similar instruments related thereto, in each case, in the ordinary course of business or consistent with past practices;
(t)
Indebtedness incurred by a Securitization Subsidiary in a Qualified Securitization Financing that is not recourse (except
for Standard Securitization Undertakings) to the Borrower or any other Loan Party;
(u)
(i) Indebtedness in respect of letters of credit issued for the account of the Borrower or any Restricted Subsidiary so
long as (A) such Indebtedness is not secured by any Lien on Collateral other than Permitted Liens and (B) the aggregate face amount of such
letters of credit does not exceed the greater of (I) 10.00% of Closing Date EBITDA and (II) 10.00% of TTM Consolidated Adjusted
EBITDA, determined at the time of issuance of such letter of credit and (ii) Indebtedness in respect of letters of credit that are fully cash
collateralized;
(v)
(i) obligations in respect of Cash Management Obligations, (ii) Cash Management Obligations (as defined in the Term
Loan Credit Agreement) and (iii) other Indebtedness in respect of netting services, automatic clearinghouse arrangements, overdraft
protections, employee credit card programs and other cash management and similar arrangements, in each case of clauses (i) through (iii),
incurred in the ordinary course of business or consistent with past practices and any Guarantees thereof;
(w)
Guarantees in respect of Indebtedness of the Borrower or any of the Restricted Subsidiaries otherwise permitted
hereunder; provided that (A) no Guarantee by any Restricted Subsidiary of any Junior Financing shall be permitted unless such Restricted
Subsidiary shall have also provided a Guarantee of the Obligations substantially on the terms set forth in the Guaranty and (B) if the
Indebtedness being Guaranteed is subordinated in right of payment to the Obligations, such Guarantee shall be subordinated to the Guaranty
in right of payment on terms at least as favorable to the Lenders as those contained in the subordination terms with respect to such
Indebtedness;
(x)
Indebtedness incurred on behalf of, or representing Guarantees of Indebtedness of, any Joint Ventures in an aggregate
principal amount not to exceed the greater of (i) 25.00% of Closing Date EBITDA and (ii) 25.00% of TTM Consolidated Adjusted EBITDA
as of the applicable date of determination, determined at the time of incurrence, and any Permitted Refinancing of the foregoing;
(y)
Indebtedness in an aggregate principal amount at any time outstanding not to exceed the greater of (A) 50% of Closing
Date EBITDA and (B) 50% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination, determined at the time of
incurrence, and any Permitted Refinancing of the foregoing;
(z)
the Existing Notes;
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(aa)
Indebtedness consisting of unsecured Indebtedness or Indebtedness subordinated in right of payment; provided that (i)
the Payment Conditions are satisfied, (ii) such Indebtedness does not mature on or prior to the date that is 91 days after the Latest Maturity
Date and (iii) no amortization payments are made in cash on such Indebtedness; and
(bb)
all premiums (if any), interest (including post-petition interest), fees, expenses, charges and additional or contingent
interest on obligations described in clauses (a) through (z) above.
For purposes of determining compliance with this Section 7.03, in the event that an item of Indebtedness (or any portion thereof)
meets the criteria of more than one of the categories set forth above, the Borrower may, in its sole discretion, at the time of incurrence, divide,
classify or reclassify, or at any later time divide, classify or reclassify, such item of Indebtedness (or any portion thereof) in any manner that
complies with this covenant on the date such Indebtedness is incurred or such later time, as applicable; provided that all Indebtedness under
(a) the Loan Documents will be deemed to have been incurred in reliance on the exception in Section 7.03(a) and (b) the Senior Secured
Notes and the Term Loan Credit Agreement on the Closing Date will be deemed incurred in reliance on the exception in Section 7.03(b), and
shall not be permitted to be reclassified pursuant to this paragraph; provided further that such Indebtedness shall not be permitted to be
divided, classified or reclassified to Section 7.03(aa).
For purposes of determining compliance with any Dollar-denominated (or percentage of TTM Consolidated Adjusted EBITDA, if
greater) restriction on the incurrence of Indebtedness, the Dollar equivalent principal amount of Indebtedness denominated in a foreign
currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred, in the case of
term debt, or first committed or first incurred (whichever yields the lower Dollar equivalent), in the case of revolving credit debt; provided
that if such Indebtedness is incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the
applicable Dollar-denominated (or percentage of TTM Consolidated Adjusted EBITDA, if greater) restriction to be exceeded if calculated at
the relevant currency exchange rate in effect on the date of such refinancing, such Dollar-denominated (or percentage of TTM Consolidated
Adjusted EBITDA, if greater) restriction will be deemed not to have been exceeded so long as the principal amount of such refinancing
Indebtedness does not exceed the principal amount of such Indebtedness being refinanced (plus unpaid accrued interest and premium
(including tender premiums) thereon and underwriting discounts, defeasance costs, fees, commissions and expenses in connection therewith).
With respect to any Indebtedness and any related Liens that were permitted to be incurred under the Loan Documents on the date
of such incurrence, any Increased Amount with respect to such Indebtedness after the date of such incurrence shall also be permitted under
the Loan Documents and, for the avoidance of doubt, shall not result in a Default or an Event of Default. The principal amount of any non-
interest bearing Indebtedness or other discount security constituting Indebtedness at any date shall be the principal amount thereof that would
be shown on a balance sheet of the Borrower dated such date prepared in accordance with GAAP. The principal amount of any non-interest
bearing Indebtedness or other discount security constituting Indebtedness at any date shall be the principal amount thereof that would be
shown on a balance sheet of the Borrower dated such date prepared in accordance with GAAP.
Section 7.04
Fundamental Changes
. Merge, dissolve, liquidate, consolidate or amalgamate with or into another Person, or effect a Division, except that:
(a)
Holdings or any Restricted Subsidiary may merge, amalgamate or consolidate with the Borrower (including a merger or
amalgamation, the purpose of which is to reorganize the Borrower into a new jurisdiction); provided that:
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(i)
(ii)
the Borrower shall be the continuing or surviving Person;
such merger, amalgamation or consolidation does not result in the Borrower ceasing to be organized under
the Laws of the United States, any state thereof or the District of Columbia; and
(iii)
in the case of a merger, amalgamation or consolidation of Holdings with and into the Borrower, (A) no
Event of Default shall exist at such time or after giving effect to such merger, amalgamation or consolidation, (B) Holdings shall
have no direct Subsidiaries at the time of such merger, amalgamation or consolidation other than the Borrower, (C) after giving
effect to such merger, amalgamation or consolidation, the direct parent of the Borrower shall expressly assume all the obligations
of Holdings under this Agreement and the other Loan Documents to which Holdings is a party pursuant to a supplement hereto or
thereto in form reasonably satisfactory to the Administrative Agent and (D) such direct parent of the Borrower shall concurrently
become a Guarantor and pledge 100% of the Equity Interest of the Borrower to the Administrative Agent as Collateral to secure
the Obligations in form reasonably satisfactory to the Administrative Agent;
(b)
any Restricted Subsidiary may merge, amalgamate or consolidate with or into any other Restricted Subsidiary or
liquidate or dissolve; provided, that if such Restricted Subsidiary is a Loan Party, the surviving Person (or the Person who receives the assets
of such dissolving or liquidated Restricted Subsidiary) shall be a Loan Party unless the transfer of the assets and operations of such Loan
Party to a Non-Loan Party would have been permitted as an Investment under Section 7.02 (it being understood that any such merger,
consolidation, amalgamation, dissolution or liquidation shall be deemed to have used the capacity under the relevant clause of Section 7.02);
provided, further, if any such Restricted Subsidiary is a Co-Borrower, (i) the Co-Borrower shall be the surviving Person or (ii) any Loans
borrowed by such Co-Borrower shall be expressly assumed by the Borrower or another Co-Borrower;
(c)
any merger or amalgamation the purpose of which is to reincorporate or reorganize a Restricted Subsidiary in another
jurisdiction shall be permitted;
(d)
any Restricted Subsidiary may liquidate or dissolve or change its legal form; provided (i) no Event of Default shall
result therefrom and (ii) the surviving Person (or the Person who receives the assets of such dissolving or liquidated Restricted Subsidiary)
shall be a Restricted Subsidiary; provided, further, if any such Restricted Subsidiary is a Co-Borrower, (x) the surviving Person (or the Person
who receives the assets of such dissolving or liquidated Restricted Subsidiary) shall be the Borrower or another Co-Borrower or (y) any
Loans borrowed by such Co-Borrower shall be expressly assumed by the Borrower or another Co-Borrower;
(e)
so long as no Default exists or would result therefrom, the Borrower may merge, amalgamate or consolidate with any
other Person; provided that:
(i)
(ii)
the Borrower shall be the continuing or surviving corporation; or
if the Person formed by or surviving any such merger, amalgamation or consolidation is not the Borrower
(any such Person, the “Successor Borrower”);
(A)
the Successor Borrower shall be an entity organized or existing under the laws of the United
States, any state thereof or the District of Columbia;
(B)
the Successor Borrower shall expressly assume all the obligations of the Borrower under this
Agreement and the other Loan Documents to which the Borrower is a
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party pursuant to a supplement hereto or thereto in form reasonably satisfactory to the Administrative Agent;
(C)
each Guarantor, unless it is the other party to such merger, amalgamation or consolidation, shall
have by a supplement to the Guaranty confirmed that its Guarantee of the Obligations shall apply to the Successor
Borrower’s obligations under this Agreement;
(D)
each Loan Party, unless it is the other party to such merger, amalgamation or consolidation, shall
have by a supplement to the Security Agreement or the Canadian Security Agreement, as applicable, confirmed that its
obligations thereunder shall apply to the Successor Borrower’s obligations under this Agreement and the direct parent
of such Person shall pledge 100% of the Equity Interests of such Person to the Administrative Agent as Collateral to
secure the Obligations; and
(E)
the Borrower shall have delivered to the Administrative Agent an officer’s certificate and an
opinion of counsel, each stating that such merger, amalgamation or consolidation and such supplement to this
Agreement or any Collateral Document comply with this Agreement, and, with respect to such opinion of counsel only,
including customary organization, due execution, no conflicts and enforceability opinions to the extent reasonably
requested by the Administrative Agent;
it being agreed that if the foregoing are satisfied, the Successor Borrower will succeed to, and be substituted for, the
Borrower under this Agreement;
(f)
any Restricted Subsidiary may merge, amalgamate or consolidate with any other Person in order to effect an
Investment, Acquisition Transaction or other transaction not prohibited by the Loan Documents (other than any transaction pursuant to
Section 7.02(o)); provided, if any such Restricted Subsidiary is a Co-Borrower, (i) the Co-Borrower shall be the surviving Person or (ii) any
Loans borrowed by such Co-Borrower shall be expressly assumed by the Borrower or another Co-Borrower;
(g)
Persons; provided that
any Loan Party or any Restricted Subsidiary may conduct a Division that produces two or more surviving or resulting
(i)
if a Division is conducted by the Borrower or a Co-Borrower, then each surviving or resulting Person shall
constitute a “Borrower” or “Co-Borrower” for all purposes of the Loan Documents (unless the Administrative Agent otherwise
consents in its reasonable discretion) and shall remain jointly and severally liable for all Obligations (other than Excluded Swap
Obligations, where applicable) of the Borrower immediately prior to such Division and otherwise comply with Section 7.04(e);
(ii)
if a Division is conducted by Holdings, then all of the Equity Interests of the Borrower must be owned by
only one Person that survives or results from such Division, and such Person owning such Equity Interests in the Borrower shall
otherwise comply with Section 7.10(b), become a Guarantor and pledge 100% of the Equity Interests of the Borrower to the
Collateral Agent; and
(iii)
if a Division is conducted by a Loan Party other than the Borrower or Holdings, then each surviving or
resulting Person of such Division shall also be a Loan Party unless and to the extent any such surviving or resulting Loan Party is
the subject of a Disposition permitted pursuant to Section 7.05 (other than Section 7.05(e)) or otherwise would constitute an
Excluded
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Subsidiary; provided further that such surviving or resulting Person not becoming a Loan Party and the assets and property of such
surviving or resulting Person not becoming Collateral shall, in each case, be treated as an Investment and shall be permitted under
this Section 7.04(g)(iii) solely to the extent permitted under Section 7.02;
(h)
as long as no Default exists or would result therefrom, a merger, amalgamation, dissolution, liquidation, consolidation
or Disposition, the purpose of which is to effect a Disposition permitted pursuant to Section 7.05 or a Permitted Reorganization (other than
Section 7.05(e)); and
(i)
the Transactions may be consummated.
Notwithstanding anything herein to the contrary, in the event of any merger, dissolution, liquidation, consolidation, amalgamation or Division
of any Loan Party or a Restricted Subsidiary effected in accordance with this Section 7.04, the Borrower shall or shall cause, with respect to
each surviving or continuing Restricted Subsidiary (or new direct Parent Entity) (a) promptly deliver or cause to be delivered to the
Administrative Agent for further distribution by the Administrative Agent to each Lender (i) such information and documentation reasonably
requested by the Administrative Agent or any Lender in order to comply with applicable “know your customer” and anti-money laundering
rules and regulations, including the USA PATRIOT Act and (ii) a Beneficial Ownership Certification and (b) do, execute, acknowledge,
deliver, record, re-record, file, re-file, register and re-register any and all such further acts, deeds, certificates, assurances and other
instruments as the Administrative Agent or Collateral Agent may reasonably request in order to perfect or continue the perfection of the
Liens granted or purported to be granted by the Collateral Documents in accordance with Section 6.11 and as promptly as practicable.
Section 7.05
Dispositions
. Make any Disposition, except:
(a)
Dispositions of obsolete, damaged, worn out, used or surplus property (including for purposes of recycling), whether
now owned or hereafter acquired and Dispositions of property of the Borrower and the Restricted Subsidiaries that is no longer used or useful
in the conduct of the business or economically practicable or commercially desirable to maintain;
(b)
Dispositions of property in the ordinary course of business;
(c)
Dispositions of property to the extent that (i) such property is exchanged for credit against the purchase price of similar
replacement property or (ii) the proceeds of such Disposition are promptly applied to the purchase price of such replacement property;
provided that to the extent the property being transferred constitutes Collateral such replacement property shall constitute Collateral;
(d)
(e)
Dispositions of property to the Borrower or a Restricted Subsidiary;
Dispositions permitted by Section 7.02 (other than Section 7.02(o)), Section 7.04 (other than Section 7.04(h)) and
Section 7.06 (other than Section 7.06(d)) and Permitted Liens;
(f)
Dispositions of property pursuant to Sale Leaseback Transactions; provided that (i) no Event of Default exists or would
result therefrom (other than any such Disposition made pursuant to a legally binding commitment entered into at a time when no Event of
Default exists) and (ii) such Disposition shall be for no less than the fair market value of such property at the time of such Disposition;
(g)
Dispositions of Cash Equivalents; provided that such Disposition shall be for no less than the fair market value of such
property at the time of such Disposition;
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(h)
leases, subleases, licenses or sublicenses (including the provision of software under an open source license), which do
not materially interfere with the business of the Borrower and the Restricted Subsidiaries, taken as a whole; provided that such Disposition
shall be for no less than the fair market value of such property at the time of such Disposition;
(i)
(j)
Dispositions of property subject to Casualty Events upon receipt of the net cash proceeds of such Casualty Event;
Dispositions; provided that:
(i)
at the time of such Disposition (other than any such Disposition made pursuant to a legally binding
commitment entered into at a time when no Default exists), no Default shall exist or would result from such Disposition;
(ii)
with respect to any Disposition pursuant to this clause ((j)) for a purchase price in excess of the greater of
10.00% of Closing Date EBITDA and 10.00% of TTM Consolidated Adjusted EBITDA as of the date of the Disposition, the
Borrower or any of the Restricted Subsidiaries shall receive not less than 75.00% of such consideration in the form of cash or Cash
Equivalents; provided, however, that for the purposes of this clause ((ii)) each of the following shall be deemed to be cash;
(A)
any liabilities (as shown on the Borrower’s or such Restricted Subsidiary’s most recent balance
sheet provided hereunder or in the footnotes thereto) of the Borrower or such Restricted Subsidiary, other than
liabilities that are by their terms subordinated to the payment in cash of the Obligations, that are assumed by the
transferee with respect to the applicable Disposition and for which the Borrower and all of the Restricted Subsidiaries
shall have been validly released by all applicable creditors in writing;
(B)
any securities received by such Borrower or Restricted Subsidiary from such transferee that are
converted by such Borrower or Restricted Subsidiary into cash or Cash Equivalents (to the extent of the cash or Cash
Equivalents received) within one hundred and eighty days following the closing of the applicable Disposition; and
(C)
any Designated Non-Cash Consideration received in respect of such Disposition having an
aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this
clause ((C)) that is at that time outstanding, not in excess of the greater of (I) 10.00% of Closing Date EBITDA and
(II) 10.00% of TTM Consolidated Adjusted EBITDA as of the date of the Disposition, with the fair market value of
each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to
subsequent changes in value; and
(iii)
such Disposition shall be for no less than the fair market value of such property at the time of such
Disposition
(this clause ((j)), the “General Asset Sale Basket”);
(k)
Dispositions of Investments in Joint Ventures to the extent required by, or made pursuant to customary buy/sell
arrangements between, the Joint Venture parties set forth in joint venture arrangements and similar binding arrangements;
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(l)
Dispositions or discounts of accounts receivable and related assets in connection with the collection, compromise,
settlement or factoring thereof; provided that any such dispositions in connection with factoring facilities shall (i) include only accounts
receivables of Account Debtors located outside of the United States, Canada, the United Kingdom, Ireland, Germany and the Netherlands or
(ii) not exceed $20,000,000 per annum;
(m)
Dispositions (including issuances or sales) of Equity Interests in, or Indebtedness owing to, or of other securities of, an
Unrestricted Subsidiary (other than an Unrestricted Subsidiary the primary assets of which are cash and Cash Equivalents);
(n)
Dispositions to the extent of any exchange of like property (excluding any boot thereon permitted by such provision)
for use in any business conducted by the Borrower or any of the Restricted Subsidiaries to the extent allowable under Section 1031 of the
Code (or comparable or successor provision);
(o)
Dispositions in connection with the unwinding of any Hedge Agreement;
(p)
Dispositions by the Borrower or any Restricted Subsidiary of assets in connection with the closing or sale of a facility
in the ordinary course of business of the Borrower and its Restricted Subsidiaries; provided that as to each and all such sales and closings, (i)
no Event of Default shall result therefrom and (ii) such sale shall be on commercially reasonable prices and terms in a bona fide arm’s-length
transaction;
(q)
Dispositions (including bulk sales) of the inventory of a Loan Party not in the ordinary course of business in connection
with facility closings, at arm’s length;
(r)
Disposition of Securitization Assets to a Securitization Subsidiary in connection with a Qualified Securitization
Financing; provided that such Disposition shall be for no less than the fair market value of such property at the time of such Disposition;;
(s)
the lapse, abandonment or discontinuance of the use or maintenance of any Intellectual Property if previously
determined by the Borrower or any Restricted Subsidiary in its reasonable business judgment that such lapse, abandonment or discontinuance
is desirable in the conduct of its business;
(t)
Disposition of any property or asset with a fair market value not to exceed $10,000,000 with respect to any transaction
or series of related transactions or $30,000,000 in the aggregate for all such transactions in any fiscal year; and
(u)
Disposition of assets acquired in a Permitted Acquisition or other Investment permitted hereunder that the Borrower
determines will not be used or useful in the business of the Borrower and its Subsidiaries.
To the extent any Collateral is Disposed of as expressly permitted by this Section 7.05 to any Person other than a Loan Party, such Collateral
shall be sold free and clear of the Liens created by the Loan Documents, and, if requested by the Administrative Agent, upon the certification
by the Borrower that such Disposition is permitted by this Agreement, and without limiting the provisions of Section 10.11 the
Administrative Agent shall be authorized to, and shall, take any actions reasonably requested by the Borrower in order to effect the foregoing
(and the Lenders hereby authorize and direct the Administrative Agent to conclusively rely on any such certification by the Borrower in
performing its obligations under this sentence).
Section 7.06
Restricted Payments
. Make, directly or indirectly, any Restricted Payment, except:
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(a)
each Restricted Subsidiary may make Restricted Payments to the Borrower and to any other Restricted Subsidiaries
(and, in the case of a Restricted Payment by a non-wholly owned Restricted Subsidiary, to the Borrower or any such other Restricted
Subsidiaries and to each other owner of Equity Interests of such Restricted Subsidiary ratably according to their relative ownership interests
of the relevant class of Equity Interests or as otherwise required by the applicable Organization Documents);
(b)
the Borrower and each of the Restricted Subsidiaries may declare and make Restricted Payments payable in the form of
Equity Interests (other than Disqualified Equity Interests not otherwise permitted to be incurred under Section 7.03) of such Person;
(c)
Restricted Payments made in connection with the Transactions (including, for the avoidance of doubt, the repurchase
of any or all of the Existing Notes pursuant to the Change of Control Offer);
(d)
to the extent constituting Restricted Payments, the Borrower and the Restricted Subsidiaries may enter into and
consummate transactions expressly permitted by any provision of Section 7.02 (other than Section 7.02(o)), 7.04 (other than a merger,
amalgamation or consolidation involving the Borrower) or 7.07 (other than Section 7.07(a), (j) or (k));
(e)
Restricted Payments in respect of the repurchase of Equity Interests in Holdings (or any Parent Entity of Holdings that
only owns Equity Interests, directly or indirectly, in the Borrower and its Subsidiaries), the Borrower or any Restricted Subsidiary that occur
upon or in connection with the exercise of stock options or warrants or similar rights if such Restricted Payments represent a portion of the
exercise price of such options or warrants or similar rights or tax withholding obligations with respect thereto;
(f)
Restricted Payments of Equity Interests in, Indebtedness owing from and/or other securities of or Investments in, any
Unrestricted Subsidiaries (other than any Unrestricted Subsidiaries the assets of which consist solely of cash or Cash Equivalents received
from an Investment by the Borrower and/or any Restricted Subsidiary into it);
(g)
the Borrower may pay (or make Restricted Payments to allow Holdings or any Parent Entity to pay) for the repurchase,
retirement or other acquisition or retirement for value of Equity Interests of Holdings (or of any Parent Entity) held by any Management
Stockholder, including pursuant to any employee or director equity plan, employee or director stock option or profits interest plan or any
other employee or director benefit plan or any agreement (including any separation, stock subscription, shareholder or partnership agreement)
with any employee, director, consultant or distributor of the Borrower (or any Parent Entity) or any of its Subsidiaries; provided, the
aggregate Restricted Payments made pursuant to this Section 7.06(g) after the Closing Date together with the aggregate amount of loans and
advances to Holdings made pursuant to Section 7.02(j) in lieu of Restricted Payments permitted by this clause (g) shall not exceed:
(i)
the greater of (A) 5.00% of Closing Date EBITDA and (B) 5.00% of TTM Consolidated Adjusted EBITDA
as of the applicable date of measurement in any calendar year, with unused amounts in any calendar year being carried over to the
next two succeeding calendar years; plus
(ii)
an amount not to exceed the cash proceeds of key man life insurance policies received by the Borrower or the
Restricted Subsidiaries after the Closing Date; plus
(iii)
to the extent contributed in cash to the common Equity Interests of the Borrower and Not Otherwise
Applied, the proceeds from the sale of Equity Interests of Holdings or any Parent
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Entity, in each case to a Person that is or becomes a Management Stockholder that occurs after the Closing Date; plus
(iv)
the amount of any cash bonuses or other compensation otherwise payable to any future, present or former
Company Person that are foregone in return for the receipt of Equity Interests of Holdings or a Parent Entity, Borrower or any
Restricted Subsidiary; plus
(v)
payments made in respect of withholding or other similar taxes payable upon repurchase, retirement or other
acquisition or retirement of Equity Interests of Holdings or a Parent Entity or its Subsidiaries or otherwise pursuant to any
employee or director equity plan, employee or director stock option or profits interest plan or any other employee or director
benefit plan or any agreement;
(h)
the Borrower may make Restricted Payments to Holdings or to any Parent Entity:
(i)
the proceeds of which will be used to pay (or make dividends or distributions to allow any direct or indirect
Parent Entity treated as a corporation for Tax purposes to pay) the Tax liability (including estimated Tax payments) to each
foreign, federal, state, provincial, territorial or local jurisdiction in respect of which a tax return is filed by Holdings (or such direct
or indirect Parent Entity) that includes the Borrower and/or any of its Subsidiaries (including in the case where the Borrower and
any Subsidiary is a disregarded entity for income Tax purposes), to the extent such Tax liability does not exceed the lesser of (A)
the Taxes (including estimated Tax payments) that would have been payable by the Borrower and/or its Subsidiaries as a stand-
alone Tax group (assuming, if applicable, that the Borrower was classified as a corporation for income Tax purposes) and (B) the
actual Tax liability (including estimated Tax payments) of Holdings’ Tax group (or, if Holdings is not the parent of the actual
group, the Taxes that would have been paid by Holdings (assuming, if applicable, that Holdings was classified as a corporation for
income Tax purposes), the Borrower and/or the Borrower’s Subsidiaries as a stand-alone Tax group), reduced in the case of
clauses (A) and (B) by any such Taxes paid or to be paid directly by the Borrower or its Subsidiaries; provided that in the case of
any such distributions attributable to Tax liability in respect of income of an Unrestricted Subsidiary, the Borrower shall use all
commercially reasonable efforts to cause such Unrestricted Subsidiary (or another Unrestricted Subsidiary) to make cash
distributions to the Borrower or its Restricted Subsidiaries in an aggregate amount that the Borrower determines in its reasonable
discretion is necessary to pay such Tax liability in respect of such Unrestricted Subsidiary;
(ii)
the proceeds of which will be used to pay (or make Restricted Payments to allow any Parent Entity to pay)
operating costs and expenses (including Public Company Costs) of Holdings or any Parent Entity incurred in the ordinary course
of business and other corporate overhead costs and expenses (including administrative, legal, accounting and similar expenses
provided by third parties), which are reasonable and customary and incurred in the ordinary course of business, attributable to the
ownership or operations of the Borrower and its Subsidiaries;
(iii)
the proceeds of which will be used to pay franchise taxes and other fees, taxes and expenses required to
maintain its (or any of such Parent Entity’s) corporate or legal existence;
(iv)
to finance any Investment permitted to be made pursuant to Section 7.02; provided that (A) such Restricted
Payment shall be made substantially concurrently with the closing of such Investment and (B) Holdings and the Borrower shall,
immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) to be contributed to
the Borrower or a Restricted Subsidiary (which shall be a Restricted Subsidiary to the extent required by Section
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7.02) or (2) the merger or amalgamation (to the extent permitted in Section 7.04) of the Person formed or acquired by the
Borrower or a Restricted Subsidiary in order to consummate such Investment;
(v)
the proceeds of which shall be used to pay (or make Restricted Payments to allow any Parent Entity to pay)
costs, fees and expenses (other than to Affiliates) related to any successful or unsuccessful equity or debt offering permitted by
this Agreement; and
(vi)
the proceeds of which (A) will be used to pay customary salary, bonus and other benefits payable to officers
and employees of Holdings or any Parent Entity to the extent such salaries, bonuses and other benefits are attributable to the
ownership or operation of the Borrower and the Restricted Subsidiaries or (B) will be used to make payments permitted under
Sections 7.07(e),((h)), ((k)) and ((q)) (but only to the extent such payments have not been and are not expected to be made by the
Borrower or a Restricted Subsidiary);
(i)
Restricted Payments (i) made in connection with the payment cash in lieu of fractional Equity Interests in connection
with any dividend, split or combination thereof or any Permitted Acquisition or other transaction permitted by the Loan Documents or (ii) to
honor any conversion request by a holder of convertible Indebtedness and to make cash payments in lieu of fractional shares in connection
therewith;
(j)
following a Qualifying IPO, the declaration and payment of dividends on the Borrower’s, Holdings’ or a Parent Entity’s
common stock, not to exceed an amount per annum equal to 6% of the net proceeds received by or contributed to Borrower in or from a
Qualifying IPO (or in the case of a SPAC IPO, cash held by the Borrower (or held by Holdings or any other Parent Entity to the extent
contributed to the Borrower) following the consummation of such SPAC IPO);
(k)
repurchases of Equity Interests (i) deemed to occur on the exercise of options by the delivery of Equity Interests in
satisfaction of the exercise price of such options or (ii) in consideration of withholding or similar Taxes payable by any future, present or
former employee, director, manager or consultant (or any spouses, former spouses, successors, executors, administrators, heirs, legatees or
distributees of any of the foregoing), including deemed repurchases in connection with the exercise of stock options or the vesting of any
equity awards;
(l)
payments or distributions to satisfy dissenters rights (including in connection with or as a result of the exercise of
appraisal rights and the settlement of any claims or actions, whether actual, contingent or potential) pursuant to or in connection with a
merger, amalgamation, consolidation, transfer of assets or other transaction permitted by the Loan Documents;
(m)
payments or distributions of a Restricted Payment within 60 days after the date of declaration thereof if at the date of
declaration such Restricted Payment would have been permitted hereunder;
(n)
Restricted Payments (not consisting of cash or Cash Equivalents) made in lieu of fees or expenses (including by way of
discount), in each case in connection with any Qualified Securitization Financing;
(o)
the Borrower may (or may make Restricted Payments to permit any Parent Entity to) (i) redeem, repurchase, retire or
otherwise acquire in whole or in part any Equity Interests of the Borrower or any Restricted Subsidiary or any Equity Interests of any Parent
Entity (“Treasury Equity Interests”), in exchange for, or with the proceeds (to the extent contributed to Holdings or the Borrower
substantially concurrently) of the sale or issuance (other than to the Borrower or any Restricted Subsidiary) of, other
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Equity Interests or rights to acquire its Equity Interests (“Refunding Equity Interests”) and (ii) declare and pay dividends on any Treasury
Equity Interests out of any such proceeds;
(p)
redemptions in whole or in part of any of its Equity Interests for another class of its Equity Interests (other than
Disqualified Equity Interests, except to the extent issued by the Borrower to a Restricted Subsidiary) or with proceeds from substantially
concurrent equity contributions or issuances of new Equity Interests (other than Disqualified Equity Interests, except to the extent issued by
the Borrower to a Restricted Subsidiary);
(q)
Restricted Payments constituting or otherwise made in connection with or relating to any Permitted Reorganization;
provided that if immediately after giving Pro Forma Effect to any such Permitted Reorganization and the transactions to be consummated in
connection therewith, any distributed asset ceases to be owned by the Borrower or another Restricted Subsidiary (or any entity ceases to be a
Restricted Subsidiary), the applicable portion of such Restricted Payment must be otherwise permitted under another provision of this
Section 7.06 (and constitute utilization of such other Restricted Payment exception or capacity);
Payment);
(r)
(s)
Restricted Payments so long as the Payment Conditions are satisfied (after giving Pro Forma Effect to such Restricted
[reserved]; and
(t)
together with any Junior Debt Repayments under Section 7.09(a)(x)(B), the greater of (A) 25.00% of Closing Date
EBITDA and (B) 25.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination; provided that no Event of
Default exists or would result therefrom;
The amounts set forth in Section 7.06(t) may, in lieu of Restricted Payments, be utilized by the Borrower or any Restricted
Subsidiary to make any Investments without regard to Section 7.02.
The amount of any Restricted Payment at any time shall be the amount of cash and the fair market value of other property subject
to the Restricted Payment at the time such Restricted Payment is made. For purposes of determining compliance with this Section 7.06, in
the event that any Restricted Payment (or any portion thereof) meets the criteria of more than one of the categories set forth above, the
Borrower may, in its sole discretion, at the time of such Restricted Payment is made, divide, classify or reclassify, or at any later time divide,
classify, or reclassify, such Restricted Payment (or any portion thereof) in any manner that complies with this covenant on the date such
Restricted Payment is made or such later time, as applicable; provided that such Restricted Payment shall not be permitted to be reclassified
to Section 7.06(r).
Section 7.07
Transactions with Affiliates
. Enter into any transaction of any kind with any Affiliate of the Borrower, other than:
(a)
transactions between or among the Borrower or any of the Restricted Subsidiaries or any entity that becomes a
Restricted Subsidiary as a result of such transaction;
(b)
transactions on terms substantially as favorable to the Borrower or such Restricted Subsidiary as would be obtainable
by the Borrower or such Restricted Subsidiary at the time in a comparable arm’s-length transaction with a Person other than an Affiliate (as
determined by the Borrower in good faith); provided that (x) any transaction pursuant to this Section 7.07(b) in excess of $25,000,000 shall
be approved by a majority of the disinterested members of the Board of Directors of Holdings or the Borrower in good faith and (y) for any
transaction pursuant to this Section 7.07(b) in excess of $50,000,000,
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the Borrower shall deliver to the Administrative Agent a letter from an Independent Financial Advisor stating that such transaction is fair to
the Borrower or such Restricted Subsidiary from a financial point of view or is on terms substantially as favorable to the Borrower or such
Restricted Subsidiary as would be obtainable by the Borrower or such Restricted Subsidiary at the time in a comparable arm’s-length
transaction with a Person other than an Affiliate;
(c)
the Transactions and the payment of fees and expenses (including the Transaction Expenses) related to the Transactions
on or about the Closing Date to the extent such fees and expenses are disclosed to the Administrative Agent prior to the Closing Date;
(d)
the issuance or transfer of Equity Interests of Holdings or any Parent Entity to any Affiliate of the Borrower or any
former, current or future officer, director, manager, employee or consultant (or any spouses, former spouses, successors, executors,
administrators, heirs, legatees or distributees of any of the foregoing) of the Borrower or any of its Subsidiaries or any Parent Entity;
(e)
[reserved];
(f)
employment and severance arrangements and confidentiality agreements among Holdings, the Borrower and the
Restricted Subsidiaries and their respective officers and employees in the ordinary course of business and transactions pursuant to stock
option, profits interest and other equity plans and employee benefit plans and arrangements;
(g)
the licensing of trademarks, copyrights or other Intellectual Property in the ordinary course of business to permit the
commercial exploitation of intellectual property between or among Affiliates and Subsidiaries of the Borrower;
(h)
the payment of customary fees and reasonable out-of-pocket costs to, and indemnities provided on behalf of, directors,
officers, employees and consultants of Holdings, the Borrower and the Restricted Subsidiaries or any Parent Entity in the ordinary course of
business to the extent attributable to the ownership or operation of the Borrower and the Restricted Subsidiaries;
(i)
any agreement, instrument or arrangement as in effect as of the Closing Date or any amendment thereto (so long as any
such amendment is not adverse to the Lenders in any material respect as compared to the applicable agreement as in effect on the Closing
Date);
(j)
(k)
Restricted Payments permitted under Section 7.06 and Investments permitted under Section 7.02;
[reserved];
(l)
transactions in which the Borrower or any of the Restricted Subsidiaries, as the case may be, delivers to the
Administrative Agent a letter from an Independent Financial Advisor stating that such transaction is fair to the Borrower or such Restricted
Subsidiary from a financial point of view or meets the requirements of clause (b) of this Section 7.07 (without giving effect to the
parenthetical phrase at the end thereof);
(m)
(n)
[reserved];
investments by Jackson Wijaya in securities of Holdings or Indebtedness of Holdings, Borrower or any of the
Restricted Subsidiaries so long as (A) the investment is being offered generally to
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other investors on the same or more favorable terms and (B) the investment constitutes less than 5.0% of the proposed or outstanding issue
amount of such class of securities;
(o)
(p)
payments to or from, and transactions with, Joint Ventures in the ordinary course of business;
any Disposition of Securitization Assets or related assets in connection with any Qualified Securitization Financing;
(q)
the payment of reasonable out-of-pocket costs and expenses relating to registration rights and indemnities provided to
shareholders of Holdings or any Parent Entity pursuant to the stockholders agreement or the registration and participation rights agreement
entered into on the Closing Date in connection therewith;
(r)
the payment of any dividend or distribution within sixty days after the date of declaration thereof, if at the date of
declaration (i) such payment would have complied with the provisions of this Agreement and (ii) no Event of Default occurred and was
continuing;
(s)
transactions between the Borrower or any of the Subsidiaries and any person, a director of which is also a director of
the Borrower or any direct or indirect Parent Entity of the Borrower; provided however, that (i) such director abstains from voting as a
director of the Borrower or such direct or indirect Parent Entity, as the case may be, on any matter involving such other person and (ii) such
Person is not an Affiliate of Holdings for any reason other than such director’s acting in such capacity;
(t)
payments, loans (or cancellation of loans) or advances to employees or consultants that are (i) approved by a majority of
the disinterested members of the Board of Directors of Holdings or the Borrower in good faith, (ii) made in compliance with applicable law
and (iii) otherwise permitted under this Agreement; and
(u)
transactions (i) with Holdings in its capacity as a party to any Loan Document or to any agreement, document or
instrument governing or relating to (A) any Indebtedness permitted to be incurred pursuant to Section 7.03 (including Permitted Refinancings
thereof) or (B) the Acquisition Agreement, any other agreements contemplated thereby or any agreement, document or instrument governing
or relating to any Permitted Acquisition (whether or not consummated) and (ii) with any Affiliate or branch in its capacity as a Lender party
to any Loan Document or party to any agreement, document or instrument governing or relating to any Indebtedness permitted to be incurred
pursuant to Section 7.03 (including Permitted Refinancings thereof) to the extent such Affiliate or branch is being treated no more favorably
than all other Lenders or lenders thereunder.
Section 7.08
Negative Pledge
. Enter into or permit to exist any Contractual Obligation (other than this Agreement or any other Loan Document) that prohibits
or restricts the ability of any Restricted Subsidiary (other than an Excluded Subsidiary) (i) that is not a Loan Party, to make dividends or
distributions to (directly or indirectly), or to make or repay loans or advances to, any Loan Party or (ii) to create, incur, assume or suffer to
exist Liens on property of such Person (other than Excluded Assets) for the benefit of the Lenders to secure the Obligations under the Loan
Documents (other than Incremental Facilities that are not intended to be secured on a first lien basis);
provided that the foregoing shall not apply to Contractual Obligations that:
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(a)
exist on the Closing Date, including Contractual Obligations governing Indebtedness incurred on the Closing Date to
finance the Transactions and any Permitted Refinancing thereof or other Contractual Obligations executed on the Closing Date in connection
with the Transactions;
(b)
are binding on a Restricted Subsidiary at the time such Restricted Subsidiary first becomes a Restricted Subsidiary, so
long as such Contractual Obligations were not entered into in contemplation of such Person becoming a Restricted Subsidiary or binding with
respect to any asset at the time such asset was acquired;
(c)
are Contractual Obligations of a Restricted Subsidiary that is not a Loan Party or to the extent applicable only to
Excluded Assets;
(d)
are customary restrictions that arise in connection with (A) any Lien permitted by Section 7.01 and relate to the
property subject to such Lien or (B) any Disposition permitted by Section 7.05 applicable pending such Disposition solely to the assets
(including Equity Interests) subject to such Disposition;
(e)
Joint Venture;
are joint venture agreements and other similar agreements applicable to Joint Ventures and applicable solely to such
(f)
are negative pledges and restrictions on Liens in favor of any holder of Indebtedness permitted under Section 7.03 but
solely to the extent any negative pledge relates to the property financed by or the subject of or that secures such Indebtedness and the
proceeds and products thereof;
(g)
are restrictions in leases, subleases, licenses, sublicenses or agreements governing a disposition of assets, trading,
netting, operating, construction, service, supply, purchase, sale or other agreements entered into in the ordinary course of business so long as
such restrictions relate to the assets subject thereto;
(h)
comprise restrictions imposed by any agreement relating to secured Indebtedness permitted pursuant to Section 7.03 to
the extent that such restrictions apply only to the property or assets securing such Indebtedness and the proceeds and products thereof;
(i)
(j)
(k)
are customary provisions restricting subletting or assignment of any lease governing a leasehold interest;
are customary provisions restricting assignment of any agreement entered into in the ordinary course of business;
are restrictions on cash or other deposits imposed by customers or trade counterparties under contracts entered into in
the ordinary course of business;
(l)
arise in connection with cash or other deposits permitted under Section 7.01;
(m)
comprise restrictions that are, taken as a whole, in the good faith judgment of the Borrower (i) no more restrictive with
respect to the Borrower or any Restricted Subsidiary than customary market terms for Indebtedness of such type, (ii) no more restrictive than
the restrictions contained in this Agreement, or (iii) not reasonably anticipated to materially and adversely affect the Loan Parties’ ability to
make any payments required hereunder;
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(n)
apply by reason of any applicable Law, rule, regulation or order or are required by any Governmental Authority having
jurisdiction over the Borrower or any Restricted Subsidiary;
(o)
customary restrictions contained in Indebtedness permitted to be incurred pursuant to Section 7.03(b), (h), (i), (j), (k),
(l), (m), (x), or (y);
(p)
(q)
Contractual Obligations that are subject to the applicable override provisions of the UCC or the PPSA;
customary provisions (including provisions limiting the Disposition, distribution or encumbrance of assets or property)
included in sale leaseback agreements or other similar agreements;
(r)
net worth provisions contained in agreements entered into by the Borrower or any Restricted Subsidiary, so long as the
Borrower has determined in good faith that such net worth provisions would not reasonably be expected to impair the ability of the Borrower
or such Restricted Subsidiary to meet its ongoing obligations;
(s)
restrictions arising in any agreement relating to (i) any Cash Management Obligation to the extent such restrictions
relate solely to the cash, bank accounts or other assets or activities subject to the applicable Cash Management Services, (ii) any treasury
arrangements and (iii) any Hedge Agreement;
(t)
restrictions on the granting of a security interest in Intellectual Property contained in licenses, sublicenses or cross-
licenses by the Borrower or any Restricted Subsidiary of such Intellectual Property, which licenses, sublicenses and cross-licenses were
entered into in the ordinary course of business;
(u)
other restrictions or encumbrances imposed by any amendment, modification, restatement, renewal, increase,
supplement, refunding, replacement or refinancing of the contracts, instruments or obligations referred to in the preceding clauses of this
Section 7.08; provided that no such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or
refinancing is, in the good faith determination of the Borrower, materially more restrictive with respect to such encumbrances and other
restrictions, taken as a whole, than those in effect prior to the relevant amendment, modification, restatement, renewal, increase, supplement,
refunding, replacement or refinancing; and
(v)
any agreement or other instrument of a Person acquired by the Borrower or any Restricted Subsidiary which was in
existence at the time of such acquisition (but not created in contemplation thereof or to provide all or any portion of the funds or credit
support utilized to consummate such acquisition other than in connection with the incurrence of Indebtedness of the type contemplated by
Section 7.03(d)), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the
Person and its Subsidiaries, or the property or assets of the Person and its Subsidiaries, so acquired.
Section 7.09
Junior Debt Prepayments; Amendments to Junior Financing Documents
.
(a)
Prepayments of Junior Financing. Prepay, repay, redeem, purchase, defease or otherwise satisfy prior to the date that is
one year before the scheduled maturity thereof any Junior Financing (any such prepayment, repayment, redemption, purchase, defeasance or
satisfaction, a “Junior Debt Repayment”), except:
(i)
Junior Debt Repayments with the proceeds of, or in exchange for, any (A) Permitted Refinancing or (B) other
Junior Financing or Junior Lien Debt;
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(ii)
Junior Debt Repayments (A) made with Qualified Equity Interests of Holdings or any Parent Entity, with the
proceeds of an issuance of any such Equity Interests or with the proceeds of a contribution to the capital of the Borrower after the
Closing Date that is Not Otherwise Applied or (B) consisting of the conversion of any Junior Financing to Equity Interests;
(iii)
Junior Debt Repayments of Indebtedness of the Borrower or any Restricted Subsidiary owed to Holdings,
the Borrower or a Restricted Subsidiary;
(iv)
Junior Debt Repayments of Indebtedness of any Person that becomes a Restricted Subsidiary after the
Closing Date in connection with a transaction not prohibited by the Loan Documents;
(v)
Junior Debt Repayments within 60 days of giving notice thereof if at the date of such notice, such payment
would have been permitted hereunder;
(vi)
Junior Debt Repayments made in connection with the Transactions;
(vii)
Junior Debt Repayments consisting of the payment of regularly scheduled interest and principal payments,
payments of fees, expenses, penalty interest and indemnification obligations when due, other than payments prohibited by any
applicable subordination provisions;
(viii)
Junior Debt Repayments consisting of a payment to avoid the application of Section 163(e)(5) of the Code
(an “AHYDO Catch Up Payment”);
(ix)
Junior Debt Repayments so long as the Payment Conditions are satisfied (after giving Pro Forma Effect any
such Junior Debt Repayment); and
(x)
Junior Debt Repayments in an aggregate amount not to exceed, together with any Restricted Payments under
Section 7.06(s)(ii), the greater of (A) 25.00% of Closing Date EBITDA and (B) 25.00% of TTM Consolidated Adjusted EBITDA
of the Borrower on a Pro Forma Basis as of the applicable date of determination.
provided, however, that each of the following shall be permitted: payments of regularly scheduled principal and interest on Junior Financing,
payments of closing and consent fees related to Junior Financing, indemnity and expense reimbursement payments in connection with Junior
Financing, and mandatory prepayments, mandatory redemptions and mandatory purchases, in each case pursuant to the terms of Junior
Financing Documentation.
For the avoidance of doubt, the redemption or repurchase of any or all of the Existing Notes pursuant to the Change of Control
Offer or otherwise shall not constitute a Junior Debt Repayment.
The amount set forth in Section 7.09(a)(x) may, in lieu of Junior Debt Repayments be utilized by the Borrower or any Restricted
Subsidiary to make any Investments without regard to Section 7.02.
The amount of any Junior Debt Repayment at any time shall be the amount of cash and the fair market value of other property
used to make the Junior Debt Repayment at the time such Junior Debt Repayment is made. For purposes of determining compliance with
this Section 7.09(a), in the event that any prepayment, repayment, redemption, purchase, defeasance or satisfaction (or any portion thereof)
meets the criteria of more than one of the categories set forth above, the Borrower may, in its sole discretion, at the time of such prepayment,
repayment, redemption, purchase, defeasance or satisfaction is made, divide, classify, or reclassify, or at any later time divide, classify or
reclassify, such prepayment, repayment,
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redemption, purchase, defeasance or satisfaction (or any portion thereof) in any manner that complies with this covenant on the date it was
made or such later time, as applicable; provided that such Junior Debt Repayments shall not be permitted to be reclassified to Section 7.09(a)
(ix).
(b)
Amendments to Junior Financing Documents. Amend, modify or change in any manner without the consent of the
Administrative Agent, any Junior Financing Documentation unless (i) such amendment, modification or change is permitted pursuant to any
applicable intercreditor or subordination agreement or (ii) the Borrower determines in good faith that the effect of such amendment,
modification or waiver is not, taken as a whole, materially adverse to the interests of the Lenders, in each case, other than as a result of a
Permitted Refinancing thereof; provided that, in each case, a certificate of the Borrower delivered to the Administrative Agent at least five
Business Days prior to such amendment or other modification, together with a reasonably detailed description of such amendment or
modification, stating that the Borrower has reasonably determined in good faith that such terms and conditions satisfy such foregoing
requirement shall be conclusive evidence that such terms and conditions satisfy such foregoing requirement unless the Administrative Agent
notifies the Borrower within such five Business Day period that it disagrees with such determination (including a reasonably detailed
description of the basis upon which it disagrees).
Section 7.10
Passive Holding Company
.
(a)
In the case of Holdings, engage in any active trade or business, it being agreed that the following activities (and
activities incidental thereto) will not be prohibited:
(i)
its ownership of the Equity Interests of the Borrower;
(ii)
maintenance);
the maintenance of its legal existence (including the ability to incur fees, costs and expenses relating to such
(iii)
the performance of its obligations and payments with respect to (i) any Indebtedness permitted to be
incurred pursuant to Section 7.03, any Qualified Holding Company Debt or any Permitted Refinancing of any of the foregoing or
(ii) the Acquisition Agreement and the other agreements contemplated by the Acquisition Agreement;
(iv)
any public offering of its common stock or any other issuance of its Equity Interests (including Qualified
Equity Interests);
(v)
making (i) payments or Restricted Payments to the extent otherwise permitted under this Section 7.10 and (ii)
Restricted Payments with any amounts received pursuant to transactions permitted under, and for the purposes contemplated by,
Section 7.06;
(vi)
(vii)
the incurrence of Qualified Holding Company Debt;
making contributions to the capital of its Subsidiaries;
(viii)
guaranteeing the obligations of the Borrower and its Subsidiaries in each case solely to the extent such
obligations of the Borrower and its Subsidiaries are not prohibited hereunder;
(ix)
participating in tax, accounting and other administrative matters as a member of a consolidated, combined or
unitary group that includes Holdings and the Borrower;
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(x)
holding any cash or property received in connection with Restricted Payments made by the Borrower in
accordance with Section 7.06 pending application thereof by Holdings;
(xi)
(xii)
providing indemnification to officers and directors;
making Investments in assets that are Cash Equivalents; and
(xiii)
activities incidental to the businesses or activities described in clauses (i) to (xii) of this Section 7.10(a).
(b)
Holdings may not merge, amalgamate, dissolve, liquidate or consolidate with or into any other Person; provided that,
notwithstanding the foregoing, as long as no Default exists or would result therefrom, Holdings may merge, amalgamate or consolidate with
any other Person if the following conditions are satisfied:
(i)
(ii)
Holdings shall be the continuing or surviving Person, or
if the Person formed by or surviving or continuing following any such merger, amalgamation or
consolidation is not Holdings or is a Person into which Holdings has been liquidated,
(A)
the Successor Holdings shall be an entity organized or existing under the laws of the United
States, any state thereof or the District of Columbia,
(B)
the Successor Holdings shall expressly assume all the obligations of Holdings under this
Agreement and the other Loan Documents to which Holdings is a party pursuant to a supplement hereto or thereto in
form reasonably satisfactory to the Administrative Agent,
(C)
the Successor Holdings shall pledge 100% of the Equity Interest of the Borrower to the Collateral
Agent as Collateral to secure the Obligations in form reasonably satisfactory to the Administrative Agent, and
(D)
the Borrower shall have delivered to the Administrative Agent an officer’s certificate and an
opinion of counsel, each stating that such merger, amalgamation or consolidation and such supplement to this
Agreement or any Collateral Document comply with this Agreement and, with respect to such opinion of counsel only,
including customary organization, due execution, no conflicts and enforceability opinions to the extent reasonably
requested by the Administrative Agent;
it being agreed that if the foregoing are satisfied, the Successor Holdings will succeed to, and be substituted for, Holdings under this
Agreement.
Notwithstanding anything herein to the contrary, in the event of any merger, dissolution, liquidation, consolidation, amalgamation
or Division of Holdings effected in accordance with this Section 7.10, the Borrower shall or shall cause, with respect to the surviving or
continuing Person (or new direct Parent Entity) (x) promptly deliver or cause to be delivered to the Administrative Agent for further
distribution by the Administrative Agent to each Lender (1) such information and documentation reasonably requested by the Administrative
Agent or any Lender in order to comply with applicable “know your customer” and anti-money laundering rules and regulations, including
the USA PATRIOT Act and (2) a Beneficial Ownership Certification and (y) do, execute, acknowledge, deliver, record, re-record, file,
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re-file, register and re-register any and all such further acts, deeds, certificates, assurances and other instruments as the Administrative Agent
or Collateral Agent may reasonably request in order to perfect or continue the perfection of the Liens granted or purported to be granted by
the Collateral Documents as promptly as practicable.
Section 7.11
Changes in Fiscal Year
. Make any change in the fiscal year of the Borrower; provided, however, that the Borrower may, upon written notice to the
Administrative Agent, change its fiscal year to any other fiscal year reasonably acceptable to the Administrative Agent, in which case, the
Borrower and the Administrative Agent will, and are hereby authorized by the Lenders to, make any adjustments to this Agreement that are
necessary to reflect such change in fiscal year.
Section 7.12
Canadian Pension Plans
. The Borrower will not, nor will it permit any of its Subsidiaries to, contribute to or assume or cause an obligation to contribute to or have
any liability under any Canadian Defined Benefit Pension Plan or Canadian Multi-Employer Pension Plan, other than those set forth on
Schedule 5.11(c), or acquire an interest in any Person that sponsors, maintains or contributes to a Canadian Defined Benefit Pension Plan or a
Canadian Multi-Employer Pension Plan, if following such acquisition, such Person becomes a Subsidiary, in each case, without the prior
written consent of the Administrative Agent in its Permitted Discretion.
ARTICLE VIII.
ARTICLE VIII.
FINANCIAL COVENANT
So long as the Termination Conditions have not been satisfied, the Borrower and each of the Restricted Subsidiaries covenant and
agree that:
Section 8.01
Fixed Charge Coverage Ratio
. Upon the occurrence and during the continuance of a Covenant Trigger Event, the Borrower shall not permit (a) as of the last
day of the most recently ended Test Period prior to the occurrence of such Covenant Trigger Event and (b) as of the last day of each Test
Period ended thereafter during the continuance of such Covenant Trigger Event, the Fixed Charge Coverage Ratio to be less than 1.00 to
1.00. To the extent required to be tested with respect to any Test Period pursuant to the preceding sentence, compliance with this Section
8.01 shall be calculated in the Compliance Certificate for the applicable Test Period delivered pursuant to Section 6.02(a).
Section 8.02
Borrower’s Right to Cure
. Notwithstanding anything to the contrary contained in Section 8.01, in the event that the Fixed Charge Coverage Ratio is less
than the amount set forth in Section 8.01 on the last day of any applicable Test Period, any equity contribution (in the form of common equity
or other equity that is not a Disqualified Equity Interest) made to the Borrower after the end of the relevant fiscal quarter and on or prior to
the day that is ten Business Days after the date on which the applicable Covenant Trigger Event occurred (such date, the “Cure Expiration
Date”) will, at the request of the Borrower, be included in the calculation of Consolidated Adjusted EBITDA solely for the purposes of
determining compliance with the financial covenant set forth in Section 8.01 at the end of such Test Period and any subsequent period that
includes a fiscal quarter in such Test Period (any such equity contribution, a “Specified Equity Contribution”); provided that,
(a)
no Lender shall be required to make any new Credit Extension under a Loan Document after receipt by the
Administrative Agent of any written notice from the Borrower of its intent to include a Specified Equity Contribution if the Borrower has not
at such time received the proceeds of such Specified Equity Contribution;
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(b)
the Borrower shall not be permitted to so request that a Specified Equity Contribution be included in the calculation of
Consolidated Adjusted EBITDA with respect to any fiscal quarter unless, after giving effect to such requested Specified Equity Contribution,
there would be at least two fiscal quarters in the Relevant Four Fiscal Quarter Period in which no Specified Equity Contribution has been
made;
(c)
(d)
no more than five Specified Equity Contributions will be made in the aggregate;
the amount of any Specified Equity Contribution and the use of any proceeds therefrom will be no greater than the
amount required to cause the Borrower to be in compliance with Section 8.01;
(e)
any proceeds of Specified Equity Contributions will be disregarded for all other purposes under the Loan Documents
(including calculating Consolidated Adjusted EBITDA for purposes of determining basket levels, pricing and other items governed by
reference to Consolidated Adjusted EBITDA or any ratio-based basket and the other negative covenants); and
(f)
there shall be no reduction in Indebtedness pursuant to a cash netting provision with the proceeds of any Specified
Equity Contribution for purposes of determining compliance with the financial covenant set forth in Section 8.01 for the fiscal quarter for
which such Specified Equity Contribution was made.
ARTICLE IX.
EVENTS OF DEFAULT AND REMEDIES
Section 9.01
Events of Default
. Each of the events referred to in clauses (a) through (j) of this Section 9.01 shall constitute an “Event of Default”:
(a)
Non-Payment. Any Loan Party fails to pay (i) when and as required to be paid pursuant to the terms of this Agreement,
any amount of principal of any Loan or any Reimbursement Obligation, or (ii) within five (5) Business Days after the same becomes due, any
interest on any Loan or any fee payable pursuant to the terms of a Loan Document;
(b)
Specific Covenants. The Borrower or any Subsidiary Guarantor or, in the case of Section 7.10, Holdings, fails to
perform:
(i)
any covenant contained in (A) Section 6.02(f) (and such default shall not have been remedied or waived (i)
within five (5) Business Days or (ii) during the continuance of any period as described in clauses (1) and (2) of the first proviso of
Section 6.02(f), within three (3) Business Days after the occurrence thereof), (B) Section 6.03(a), (C) Section 6.05(a) (solely with
respect to the Borrower or any Co-Borrower) or (D) Article VII,
(ii)
the covenant set forth in Section 8.01 (any such failure to observe the covenant contained in Section 8.01, a
“Financial Covenant Event of Default”), or
(iii)
any covenant set forth in 6.19.
(c)
Other Defaults. The Borrower or any Subsidiary Guarantor fails to perform or observe any other covenant (not
specified in Section 9.01(a) or (b) above) contained in any Loan Document on its part to be performed or observed and such failure continues
for thirty days after the receipt by the Borrower of written notice thereof from the Administrative Agent; or
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(d)
Representations and Warranties. Any representation or warranty made or deemed by any Loan Party in any Loan
Document, or in any document required to be delivered pursuant to the terms of a Loan Document shall be untrue in any material respect (or,
with respect to any representation or warranty qualified by materiality or “Material Adverse Effect,” shall be untrue in any respect) when
made or deemed made; provided that (i) this clause (d) shall be limited on the Closing Date to Specified Representations, Company Specified
Representations and the Acquisition Agreement Representations and (ii) any failure of an Acquisition Agreement Representation to be
accurate shall not result in a Default or Event of Default under this clause (d) or any other provision of a Loan Document unless such failure
results in a failure of the condition set forth in Section 4.01; provided, further, that in the case of any representation and warranty made or
deemed made after the Closing Date that is capable of being cured, such representation or warranty shall remain untrue (in any material
respect or in any respect, as applicable) or uncorrected for a period of thirty days after written notice thereof from the Administrative Agent
to the Borrower; or
(e)
Cross-Default. The Borrower or any Restricted Subsidiary:
(i)
fails to make any payment of any principal or interest beyond the applicable grace period, if any, whether by
scheduled maturity, required prepayment, acceleration, demand or otherwise, in respect of its Material Indebtedness; or
(ii)
fails to perform or observe any covenant contained in an agreement governing its Material Indebtedness, or
any other event occurs, the effect of which failure or other event is to cause such Material Indebtedness to become due prior to its
stated maturity, in each case pursuant to its terms;
provided that (A) this Section 9.01(e) shall not apply to any failure if it has been remedied, cured or waived, or is capable of being cured, in
accordance with the terms of such Material Indebtedness and (B) Section 9.01(e)(ii) shall not apply (1) to any secured Indebtedness that
becomes due as a result of the sale, transfer or other disposition (including as a result of a casualty or condemnation event) of the property or
assets securing such Indebtedness; (2) to the conversion of, or the satisfaction of any condition to the conversion of, any Indebtedness that is
convertible or exchangeable for Equity Interests; (3) to a customary “change of control” put right in any indenture governing any such
Indebtedness in the form of notes; or (4) to a refinancing of Indebtedness permitted by this Agreement; or
(f)
Insolvency Proceedings, Etc. (i) The Borrower, Holdings or any Material Subsidiary (or group of Restricted
Subsidiaries that taken together would constitute a Material Subsidiary) (A) institutes or consents to the institution of any case or proceeding
under any Debtor Relief Law, (B) makes an assignment for the benefit of creditors or (C) applies for or consents to the appointment of any
receiver, interim receiver, receiver and manager, monitor, trustee, custodian, conservator, liquidator, rehabilitator, administrator,
administrative receiver or similar officer for it or for all or any material part of its property or to the marshalling of its assets or liabilities;
(ii) any receiver, interim receiver, receiver and manager, monitor, trustee, custodian, conservator, liquidator, rehabilitator, administrator,
administrative receiver or similar officer is appointed for the Borrower, Holdings or a Material Subsidiary (or group of Restricted
Subsidiaries that taken together would constitute a Material Subsidiary)without the application or consent of such Material Subsidiary (or
group of Restricted Subsidiaries that taken together would constitute a Material Subsidiary) and the appointment continues undischarged or
unstayed for sixty (60) days; (iii) any case or proceeding under any Debtor Relief Law relating to the Borrower, Holdings or a Material
Subsidiary (or group of Restricted Subsidiaries that taken together would constitute a Material Subsidiary) is instituted without the consent of
the Borrower, Holdings or such Material Subsidiary (or group of Restricted Subsidiaries that taken together would constitute a Material
Subsidiary) and continues undismissed or unstayed for sixty (60) days or (iv) an order for relief is entered in any such case or proceeding; or
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(g)
Judgments. There is entered against the Borrower, Holdings or a Material Subsidiary (or group of Restricted
Subsidiaries that taken together would constitute a Material Subsidiary) a final, enforceable and non-appealable judgment by a court of
competent jurisdiction for the Borrower, Holdings or any Restricted Subsidiary the payment of money in an aggregate amount exceeding the
Threshold Amount (to the extent not covered by independent third-party insurance or another indemnity obligation) and such judgment or
order is not satisfied, vacated, discharged or stayed or bonded for a period of sixty (60) consecutive days; or
(h)
Invalidity of Loan Documents. The material provisions of the Loan Documents, taken as a whole, at any time after
their execution and delivery and for any reason cease to be in full force and effect, except (i) as permitted by, or as a result of a transaction
permitted by, the Loan Documents (including as a result of a transaction permitted under Section 7.04 or Section 7.05), (ii) as a result of the
Termination Conditions or (iii) resulting from acts or omissions of a Secured Party or the application of applicable Law; or
(i)
Collateral Documents and Guarantee
. Any:
(i)
Collateral Document with respect to a material portion of the Collateral with a fair market value exceeding
the Threshold Amount after its execution and delivery shall for any reason cease to create a valid and perfected Lien, except (A) as
otherwise permitted by the Loan Documents, (B) resulting from the failure of the Administrative Agent or the Collateral Agent or
any of their agents or bailees to maintain possession or control of Collateral, (C) resulting from the failure to make a filing of a
continuation statement, under the Uniform Commercial Code, (D) as to Collateral consisting of real property to the extent that
such losses are covered by a lender’s title insurance policy and such insurer has not denied coverage, or (E) resulting from acts or
omissions of a Secured Party; or
(ii)
Guarantee with respect to a Guarantor that is Holdings or a Material Subsidiary (other than an Excluded
Subsidiary) shall for any reason cease to be in full force and effect, except (A) as otherwise permitted by the Loan Documents, (B)
upon the Termination Conditions, (C) upon the release of such Guarantor as provided for under the Loan Document or in
accordance with its terms or (D) resulting from acts or omissions of a Secured Party or the application of applicable law; or
(j)
Change of Control. There occurs any Change of Control.
Section 9.02
Remedies upon Event of Default
.
(a)
If (and only if) any Event of Default occurs and is continuing, the Administrative Agent may, and shall at the request of
the Required Lenders, take any or all of the following actions upon notice to the Borrower:
(i)
declare the Commitments of each Lender and the obligation of each Issuing Bank to issue Letters of Credit to
be terminated, whereupon such Commitments and obligation shall be terminated;
(ii)
declare the unpaid principal amount of all outstanding Loans, all interest and premium accrued and unpaid
thereon, and all other amounts 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 Borrower and
each Guarantor;
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(iii)
require that the Borrower or Co-Borrower Cash Collateralize its Letters of Credit (in an amount equal to
103% of the maximum face amount of all outstanding Letters of Credit); and
(iv)
exercise on behalf of itself, the Issuing Banks and the Lenders all rights and remedies available to it, the
Issuing Banks and the Lenders under the Loan Documents and/or under applicable Law;
provided that upon the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower or any Co-Borrower under
any Debtor Relief Law, the Commitments of each Lender and the obligations of each Issuing Bank to issue Letters of Credit shall
automatically terminate, the unpaid principal amount of all outstanding Loans and all interest, fees, expenses, and other amounts as aforesaid
shall automatically become due and payable and the obligation of the Borrower or Co-Borrower to Cash Collateralize the Letters of Credit as
aforesaid shall automatically become effective, in each case without further act of the Administrative Agent or any Lender.
(b)
Limitations on Remedies; Cures.
(i)
(ii)
[Reserved].
[Reserved]; and
(iii)
Cures. Any Default or Event of Default resulting from or arising in connection with a failure to provide
notice pursuant to Section 6.03(a), shall be deemed not to be “continuing” or “existing” and shall be deemed cured upon delivery
of such notice unless the Borrower knowingly fails to give timely notice of such Default or Event of Default as required
hereunder.
(iv)
Administrative Agent Notice. Upon, or prior to, taking any of the actions set forth in Section 9.02(a), the
Administrative Agent shall, on behalf of the Required Lenders deliver a notice of Default, Event of Default or acceleration, as
applicable, to the Borrower.
For the avoidance of doubt, unless a Default or an Event of Default has occurred and is continuing, the Administrative Agent (and each other
Secured Party) shall not take any of the actions described in this Section 9.02 or bring an action or proceeding under the Loan Documents or
with respect to the Obligations.
Section 9.03
Application of Funds
. After the exercise of remedies provided for in Section 9.02 (or after the Loans have automatically become immediately due and
payable as set forth in the proviso to Section 9.02(a)), any amounts received on account of the Obligations shall, subject to the Intercreditor
Agreements (and, in the case of any Defaulting Lender, subject to Section 2.19), be applied by the Administrative Agent in the following
order:
First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (other than
principal and interest, but including Attorney Costs payable under Section 11.04 and amounts payable under Article III) payable to
the Administrative Agent and the Collateral Agent in their capacities as such;
Next, to payment in full of Unfunded Advances/Participations (the amounts so applied to be distributed between or among, as
applicable, the Administrative Agent and the Issuing Banks pro rata in accordance with the amounts of Unfunded
Advances/Participations owed to them on the date of any such distribution);
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Next, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal and
interest, Obligations under Secured Hedge Agreements and Cash Management Obligations and Letter of Credit fees) payable to
the Lenders and the Issuing Banks (including Attorney Costs payable under Section 11.04 and amounts payable under Article III),
ratably among them in proportion to the amounts described in this clause Third payable to them;
Next, to payment of that portion of the Obligations constituting accrued and unpaid Letter of Credit fees and interest on the Loans
and Letter of Credit Usage, ratably among the Lenders and the Issuing Banks in proportion to the respective amounts described in
this clause Fourth held by them;
Next, to pay the principal of Protective Advances;
Next, (a) to payment of that portion of the Obligations constituting unpaid principal of the Loans (other than Protective Advances)
and the Letter of Credit Usage, (b) to the extent a Bank Products Reserve has been established therefor by the Administrative
Agent in accordance with the terms hereof, to pay the unpaid Reserved Secured Hedge Obligations, including the cash
collateralization of such Reserved Secured Hedge Obligations in an amount not to exceed the amount of the Bank Products
Reserve, (c) to the extent a Bank Products Reserve has been established therefor by the Administrative Agent in accordance the
terms hereof, to pay the unpaid Reserved Secured Cash Management Obligations in an amount not to exceed the amount of the
Bank Products Reserve, (d) to Cash Collateralize Letters of Credit (to the extent not otherwise Cash Collateralized pursuant to the
terms of this Agreement) (in an amount equal to 103% of the maximum face amount of all outstanding Letters of Credit) and to
further permanently reduce the Tranche 1 Revolving Commitments by the amount of such Cash Collateralization, ratably among
the Secured Parties in proportion to the respective amounts described in this clause Sixth held by them; provided that (i) any such
amounts applied pursuant to the foregoing subclause (d) shall be paid to the Administrative Agent for the ratable account of the
Issuing Banks to Cash Collateralize such Letters of Credit, (ii) subject to Section 2.04 and Section 2.19, amounts used to Cash
Collateralize the aggregate undrawn amount of Letters of Credit pursuant to this clause Sixth shall be applied to satisfy drawings
under such Letters of Credit as they occur and (e) upon the expiration of any Letter of Credit, the pro rata share of Cash Collateral
attributable to such expired Letter of Credit shall be applied by the Administrative Agent in accordance with the priority of
payments set forth in this Section 9.03;
Next, ratably to pay other Obligations then due (other than Obligations in respect of Secured Cash Management Services and
Secured Hedge Agreements), until paid in full;
Next, ratably to pay other Obligations in respect of Secured Cash Management Services and Secured Hedge Agreements (which
shall include Reserved Secured Cash Management Obligations and Reserved Secured Hedge Obligations in amounts in excess of
the applicable Bank Product Reserve), until paid in full;
Next, to the payment of all other Obligations of the Loan Parties that are due and payable to the Administrative Agent and the
other Secured Parties on such date, ratably based upon the respective aggregate amounts of all such Obligations owing to the
Administrative Agent and the other Secured Parties on such date; and
Last, the balance, if any, after all of the Obligations have been paid in full, to the Borrower or as otherwise required by Law.
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Amounts distributed with respect to any Reserved Secured Cash Management Obligations and Reserved Secured Hedge
Obligations shall be the lesser of (x) the maximum Reserved Secured Cash Management Obligations and Reserved Secured Hedge
Obligations last reported to the Administrative Agent and (y) the Reserved Secured Cash Management Obligations and Reserved
Secured Hedge Obligations as calculated by the methodology reported by each applicable Cash Management Bank and Hedge
Bank to the Administrative Agent for determining the amount due. The Administrative Agent shall have no obligation to calculate
the amount to be distributed with respect to any Reserved Secured Cash Management Obligations and Reserved Secured Hedge
Obligations, and at any time and from time to time may request a reasonably detailed calculation of such amount from the
applicable Secured Party holding such Reserved Secured Cash Management Obligations and Reserved Secured Hedge
Obligations. If a Secured Party fails to deliver such calculation within five (5) days following request by the Administrative
Agent, the Administrative Agent may assume the amount to be distributed is no greater than the maximum amount of the
Reserved Secured Cash Management Obligations or Reserved Secured Hedge Obligations last reported to Administrative Agent.
ADMINISTRATIVE AGENT AND OTHER AGENTS
ARTICLE X.
Section 10.01
Appointment and Authority of the Administrative Agent
.
(a)
Each Lender and each Issuing Bank hereby irrevocably appoints Barclays to act on its behalf as the Administrative
Agent hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to
exercise such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as
are reasonably incidental thereto. The provisions of this Article X (other than Sections 10.09 and 10.11) are solely for the benefit of the
Administrative Agent and the Lenders, and neither the Borrower nor any other Loan Party shall have any rights as a third party beneficiary of
any such provision. Each Issuing Bank shall act on behalf of the Tranche 1 Revolving Lenders with respect to any Letters of Credit issued by
it and the documents associated therewith, and each Issuing Bank shall have all of the benefits and immunities (i) provided to the Agents in
this Article X with respect to any acts taken or omissions suffered by such Issuing Bank in connection with Letters of Credit issued by it or
proposed to be issued by it and the Letter of Credit Documents pertaining to such Letters of Credit as fully as if the term “Agent” as used in
this Article X and the definition of “Agent-Related Person” included such Issuing Bank with respect to such acts or omissions, and (ii) as
additionally provided herein with respect to each Issuing Bank.
(b)
The Administrative Agent shall irrevocably act as the “collateral agent” under the Loan Documents, and each of the
Lenders (including in its capacities as a potential Hedge Bank and/or Cash Management Bank) and each of the Issuing Banks hereby
irrevocably appoints and authorizes the Administrative Agent to act as the agent of (and to hold any security interest created by the Collateral
Documents for and on behalf of or in trust for) such Lender and such Issuing Bank for purposes of acquiring, holding and enforcing any and
all Liens on Collateral granted by any of the Loan Parties to secure any of the Obligations, together with such powers and discretion 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 10.05 and Section 10.12 for purposes of holding or enforcing
any Lien on the Collateral (or any portion thereof) granted under the Collateral Documents, or for exercising any rights and remedies
thereunder at the direction of the Administrative Agent), shall be entitled to the benefits of all provisions of this Article X (including Section
10.07, as though such co-agents, sub-agents and attorneys-in-fact were the “collateral agent” under the Loan Documents) as if set forth in full
herein with respect thereto. Without limiting the generality of the foregoing, the Lenders and each other Secured Party hereby expressly
authorize the Administrative Agent to execute any and all
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documents (including releases) with respect to the Collateral and the rights of the Secured Parties with respect thereto (including the
Intercreditor Agreements), as contemplated by and in accordance with the provisions of this Agreement and the Collateral Documents and
acknowledge and agree that any such action by any Agent shall bind the Lenders and each other Secured Party.
(c)
Without limiting the powers of the Collateral Agent, for the purposes of holding any hypothec granted to the Collateral
Agent pursuant to the laws of the Province of Quebec to secure the prompt payment and performance of any and all Obligations by any Loan
Party, each Secured Party hereby irrevocably appoints and authorizes the Collateral Agent and, to the extent necessary, ratifies the
appointment and authorization of the Collateral Agent, to act as the hypothecary representative of the present and future creditors as
contemplated under Article 2692 of the Civil Code of Quebec, and to enter into, to take and to hold on their behalf, and for their benefit, any
hypothec, and to exercise such powers and duties that are conferred upon the Collateral Agent under any related deed of hypothec. The
Collateral Agent shall: (i) have the sole and exclusive right and authority to exercise, except as may be otherwise specifically restricted by the
terms hereof, all rights and remedies given to the Collateral Agent pursuant to any such deed of hypothec and applicable Law, and (ii) benefit
from and be subject to all provisions hereof with respect to the Collateral Agent mutatis mutandis, including, without limitation, all such
provisions with respect to the liability or responsibility to and indemnification by the Secured Parties and the Loan Parties. Any person who
becomes a Lender (including in its capacities as a potential Hedge Bank and/or Cash Management Bank) shall, by its execution of an
Assignment and Assumption, be deemed to have consented to and confirmed the Collateral Agent as the person acting as hypothecary
representative holding the aforesaid hypothecs as aforesaid and to have ratified, as of the date it becomes a Lender, all actions taken by the
Collateral Agent in such capacity. The substitution of the Collateral Agent pursuant to the provisions of this Article X also constitutes the
substitution of the Collateral Agent in its aforesaid capacity as hypothecary representative.
Section 10.02
Rights as a Lender
. Any Lender that is also serving as an Agent (including as Administrative Agent) hereunder shall have the same rights and
powers (and no additional duties or obligations) in its capacity as a Lender as any other Lender and may exercise the same as though it were
not an Agent, and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires,
include each Lender (if any) serving as an Agent hereunder in its individual capacity. Any Person serving as an Agent and its Affiliates and
branches may accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and
generally engage in any kind of banking, trust or other business with the Borrower or any Subsidiary or other Affiliate thereof as if such
Person were not an Agent hereunder and without any duty to account therefor to the Lenders, and may accept fees and other consideration
from the Borrower for services in connection herewith and otherwise without having to account for the same to the Lenders. The Lenders
acknowledge that, pursuant to such activities, any Agent or its Affiliates or branches may receive information regarding any Loan Party or
any of its Affiliates (including information that may be subject to confidentiality obligations in favor of such Loan Party or such Affiliate)
and acknowledge that no Agent shall be under any obligation to provide such information to them.
Section 10.03
Exculpatory Provisions
. None of the Administrative Agent, any of the other Agents, any of their respective Affiliates or branches, nor any of the officers,
partners, directors, employees or agents of the foregoing shall have any duties or obligations to the Lenders except those expressly set forth in
the Loan Documents. Without limiting the generality of the foregoing, an Agent (including the Administrative Agent) or any of their
respective officers, partners, directors, employees or agents:
(a)
shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is
continuing and without limiting the generality of the foregoing, the use of the term “agent” herein and in the other Loan Documents with
reference to any Agent is not intended to connote any
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fiduciary or other implied (or express) obligations arising under any agency doctrine of any applicable Law and instead, such term is used
merely as a matter of market custom, and is intended to create or reflect only an administrative relationship between independent contracting
parties;
(b)
shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary
actions and powers expressly contemplated by the Loan Documents that such Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan
Documents), provided that, notwithstanding any direction by the Required Lenders to the contrary, no Agent shall be required to take any
such discretionary action that, in its opinion or the opinion of its counsel, may expose such Agent to liability or that is contrary to any Loan
Document or applicable Law, including for the avoidance of doubt refraining from any action that, in its opinion or the opinion of its counsel,
may be in violation of the automatic stay under the Bankruptcy Code or any other Debtor Relief Law or that may effect a forfeiture,
modification or termination of property of a Defaulting Lender in violation of the Bankruptcy Code or any other Debtor Relief Law;
(c)
shall not have any duty or responsibility to disclose, and shall not be liable for the failure to disclose to any Lender, any
credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any
of the Loan Parties or any of their Affiliates, information relating to the Borrower or any of its Affiliates that is communicated to, obtained by
or in possession of the Person serving as the Administrative Agent, a Lead Arranger or any of its their respective Affiliates or branches in any
capacity, except for notices, reports and other documents expressly required herein to be furnished to the Lenders by the Administrative
Agent or the Lead Arranger, as applicable; and
(d)
shall not be liable to the Lenders for any action taken or omitted to be taken under or in connection with any of the
Loan Documents except to the extent caused by such Agent’s gross negligence or willful misconduct as determined by a final, non-
appealable judgment of a court of competent jurisdiction.
The Administrative Agent shall not be liable to the Lenders 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 be necessary, under the circumstances as provided in Section 9.02 and Section 11.01) or (ii) in the absence of
its own gross negligence or willful misconduct or of a material breach by the Administrative Agent of its obligations under the Loan
Documents as determined by a final, non-appealable judgment of a court of competent jurisdiction, in connection with its duties expressly set
forth herein. The Administrative Agent shall be deemed not to have knowledge of any Default or Event of Default unless and until notice
describing such Default or Event of Default is given to the Administrative Agent by the Borrower or the Required Lenders in writing.
No Agent-Related Person shall be responsible for or have any duty to ascertain or inquire into (i) any recital, statement, warranty
or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report, statement or agreement or
other document delivered pursuant to a Loan Document thereunder or in connection with a Loan Document or referred to or provided for in,
or received by the Administrative Agent under or in connection with any Loan Document, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth in any Loan Document or the occurrence of any Default or Event of Default, (iv)
the validity, enforceability, effectiveness or genuineness of any 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
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elsewhere in a Loan Document, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent, or to
inspect the properties, books or records of any Loan Party or any Affiliate thereof.
The Administrative Agent shall not be responsible or have any liability for, or have any duty to ascertain, inquire into, monitor or
enforce, compliance with the provisions hereof relating to Disqualified Lenders. Without limiting the generality of the foregoing, the
Administrative Agent shall not (a) be obligated to ascertain, monitor or inquire as to whether any Lender or Participant or prospective Lender
or Participant is a Disqualified Lender or (b) have any liability with respect to or arising out of any assignment or participation of Loans, or
disclosure of confidential information, to any Disqualified Lender. The list of Disqualified Lenders shall be specified on a schedule that is
held with the Administrative Agent, which list may be provided to any Lender or its proposed assignee upon request.
Section 10.04
Reliance by the Agents
. The Agents shall be entitled to rely upon, and shall not incur any liability to any Lender for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting
or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Each Agent
also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not
incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan or the issuance of a
Letter of Credit that by its terms must be fulfilled to the satisfaction of a Lender or an Issuing Bank, each Agent may presume that such
condition is satisfactory to such Lender or Issuing Bank unless the Administrative Agent shall have received notice to the contrary from such
Lender or Issuing Bank prior to the making of such Loan or the issuance of such Letter of Credit. Each Agent may consult with legal counsel
(who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable to any Lender for
any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
Each Agent shall be fully justified in failing or refusing to take any discretionary action under any Loan Document unless it shall
first receive such advice or concurrence of the Required Lenders (or other requisite percentage of Lenders) and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Agents shall in all cases be fully protected in taking any discretionary action, or in refraining from
taking any discretionary action under any Loan Document in accordance with a request or consent of the Required Lenders (or such greater
number of Lenders as may be expressly required hereby in any instance) and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders; provided that the Agents shall not be required to take any discretionary action that, in their
opinion or in the opinion of their counsel, may expose such Agent to liability or that is contrary to any Loan Document or applicable
Law. Notwithstanding the foregoing, the Administrative Agent and the Collateral Agent shall not act (or refrain from acting, as applicable)
upon any direction from the Required Lenders (or other requisite percentage of Lenders) that would cause the Administrative Agent to be in
breach of any express term or provision of this Agreement. The Lenders and each other Secured Party agree not to instruct the
Administrative Agent, Collateral Agent or any other Agent to take any action, or refrain from taking any action, that would, in each case,
cause it to violate an express duty or obligation under this Agreement.
Section 10.05
Delegation of Duties
. Each Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan
Documents by or through any one or more sub agents appointed by such Agent. Each Agent and any such sub agent may perform any and all
of its duties and exercise its rights and powers by or through their respective Agent-Related Persons. The exculpatory provisions of this
Article X shall apply to any such sub agent and to the Agent-Related Persons
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of the Agents and any such sub agent, and shall apply to their respective activities in connection with the syndication of the credit facilities
provided for herein as well as activities as the Agents. Notwithstanding anything herein to the contrary, with respect to each sub agent
appointed by an Agent, (i) such sub agent shall be a third party beneficiary under this Agreement with respect to all such rights, benefits and
privileges (including exculpatory rights and rights to indemnification) and shall have all of the rights and benefits of a third party beneficiary,
including an independent right of action to enforce such rights, benefits and privileges (including exculpatory rights and rights to
indemnification) directly, without the consent or joinder of any other Person, against any or all of the Loan Parties and the Lenders, (ii) such
rights, benefits and privileges (including exculpatory rights and rights to indemnification) shall not be modified or amended without the
consent of such sub agent, and (iii) such sub agent shall only have obligations to the Agent that appointed it as sub agent and not to any Loan
Party, Lender or any other Person and no Loan Party, Lender or any other Person shall have any rights, directly or indirectly, as a third party
beneficiary or otherwise, against such sub agent. Each Agent shall not be responsible for the negligence 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 such Agent acted with gross
negligence or willful misconduct in the selection of such sub agents.
Section 10.06
Non-Reliance on Agents and Other Lenders; Disclosure of Information by Agents
.
(a)
Each Lender and each Issuing Bank expressly acknowledges that no Agent-Related Person has made any representation
or warranty to it, and that no act by any Agent hereafter taken, including any consent to and acceptance of any assignment or review of the
affairs of any Loan Party or any Affiliate thereof, shall be deemed to constitute any representation or warranty by any Agent-Related Person
to any Lender as to any matter, including whether Agent-Related Persons have disclosed material information in their possession. Each
Lender and each Issuing Bank represents to each Agent that it has, independently and without reliance upon any Agent-Related Person and
based on such documents and information as it has deemed appropriate, made its own appraisal of, and investigation into, the business,
prospects, operations, property, financial and other condition and creditworthiness of the Loan Parties and their respective Subsidiaries, and
all applicable bank or other regulatory Laws relating to the transactions contemplated hereby, and made its own decision to enter into this
Agreement and to extend credit to the Borrower and the other Loan Parties hereunder. Each Lender and each Issuing Bank also represents
that it will, independently and without reliance upon any Agent, any other Lender or any Agent-Related Person and based on such documents
and information as it shall deem appropriate at the time, continue to make its own credit analysis, appraisals and decisions in taking or not
taking action under this Agreement and the other Loan Documents, and to make such investigations as it deems necessary to inform itself as
to the business, prospects, operations, property, financial and other condition and creditworthiness of the Borrower and the other Loan
Parties. Except for notices, reports and other documents expressly required to be furnished to the Lenders by any Agent herein, such Agent
shall not have any duty or responsibility to provide any Lender with any credit or other information concerning the business, prospects,
operations, property, financial and other condition or creditworthiness of any of the Loan Parties or any of their respective Affiliates which
may come into the possession of any Agent-Related Person. Each Lender represents and warrants that (i) the Loan Documents set forth the
terms of a commercial lending facility and (ii) it is engaged in making, acquiring or holding commercial loans in the ordinary course and is
entering into this Agreement as a Lender for the purpose of making, acquiring or holding commercial loans and providing other facilities set
forth herein as may be applicable to such Lender, and not for the purpose of purchasing, acquiring or holding any other type of financial
instrument, and each Lender agrees not to assert a claim in contravention of the foregoing. Each Lender represents and warrants that it is
sophisticated with respect to decisions to make, acquire and/or hold commercial loans and to provide other facilities set forth herein, as may
be applicable to such Lender, and either it, or the Person exercising discretion in making its decision to make, acquire and/or hold such
commercial loans or to provide such other facilities, is experienced in making, acquiring or holding such commercial loans or providing such
other facilities.
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(b)
Each Lender, by delivering its signature page to this Agreement or an Assignment and Assumption and funding its
Revolving Loans on the Closing Date, shall be deemed to have acknowledged receipt of, and consented to and approved, each Loan
Document and each other document required to be approved by any Agent, Required Lenders or Lenders, as applicable on the Closing Date.
Section 10.07
Indemnification of Agents
. Whether or not the transactions contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Administrative Agent, each Agent, each Issuing Bank, the Swing Line Lender and each other Agent-Related Person (solely to the extent any
such Agent-Related Person was performing services on behalf of any Agent, any Issuing Bank or the Swing Line Lender, as applicable)
(without limiting any indemnification obligation of any Loan Party to do so), pro rata, and hold harmless the Administrative Agent, each
Agent, each Issuing Bank, the Swing Line Lender and each other Agent-Related Person (solely to the extent any such Agent-Related Person
was performing services on behalf of any Agent, each Issuing Bank or the Swing Line Lender, as applicable) from and against any and all
Indemnified Liabilities incurred by it; provided that no Lender shall be liable for the payment to any Agent-Related Person of any portion of
such Indemnified Liabilities resulting from such Agent-Related Person’s own gross negligence or willful misconduct, as determined by a
final, non-appealable judgment of a court of competent jurisdiction; provided that, to the extent each Issuing Bank or Swing Line Lender is
entitled to indemnification under this Section 10.07 solely in its capacity and role as an Issuing Bank or as a Swing Line Lender, as
applicable, only the Tranche 1 Revolving Lenders shall be required to indemnify the applicable Issuing Bank or the Swing Line Lender, as
the case may be, in accordance with this Section 10.07 (determined as of the time that the applicable payment is sought based on each
Tranche 1 Revolving Lender’s Pro Rata Share thereof at such time); provided, further, that no action taken in accordance with the terms of a
Loan Document or in accordance with the directions of the Required Lenders (or such other number or percentage of the Lenders as shall be
required by the Loan Documents) shall be deemed to constitute gross negligence or willful misconduct for purposes of this Section 10.07. If
any indemnity furnished to any Agent, any Issuing Bank or the Swing Line Lender for any purpose shall, in the opinion of such Agent, such
Issuing Bank or the Swing Line Lender, as applicable, be insufficient or become impaired, such Agent, such Issuing Bank or the Swing Line
Lender, as applicable, may call for additional indemnity and cease, or not commence, to do the acts indemnified against until such additional
indemnity is furnished; provided, in no event shall this sentence require any Lender to indemnify any Agent, any Issuing Bank or the Swing
Line Lender against any Indemnified Liabilities in excess of such Lender’s pro rata share thereof; and provided, further, this sentence shall
not be deemed to require any Lender to indemnify any Agent, any Issuing Bank or the Swing Line Lender against any Indemnified Liabilities
described in the first proviso in the immediately preceding sentence. In the case of any investigation, litigation or proceeding giving rise to
any Indemnified Liabilities, this Section 10.07 applies whether any such investigation, litigation or proceeding is brought by any Lender or
any other Person. Without limitation of the foregoing, each Lender shall reimburse each Agent, each Issuing Bank and the Swing Line
Lender, as applicable, upon demand for its ratable share of any costs or out-of-pocket expenses (including Attorney Costs) incurred by such
Agent, such Issuing Bank or the Swing Line Lender, as applicable, in connection with the preparation, execution, delivery, administration,
modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in respect of
rights or responsibilities under, this Agreement, any other Loan Document, or any document contemplated by or referred to herein, to the
extent that such Agent, such Issuing Bank or the Swing Line Lender, as applicable, is not reimbursed for such expenses by or on behalf of the
Borrower or the Co-Borrower; provided that such reimbursement by the Lenders shall not affect the Borrower’s and the Co-Borrowers’
continuing reimbursement obligations with respect thereto; provided, further, that the failure of any Lender to indemnify or reimburse such
Agent, such Issuing Bank or the Swing Line Lender, as applicable, shall not relieve any other Lender of its obligation in respect thereof. The
undertaking in this Section 10.07 shall survive termination of the Aggregate Commitments, the payment of all other Obligations and the
resignation of the Administrative Agent, Collateral Agent, any other Agents, any Issuing Bank and the Swing Line Lender.
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Section 10.08
No Other Duties; Other Agents, Lead Arranger, Managers, Etc.
Barclays, BMO, CS and WF is each hereby appointed as a Lead Arranger hereunder, and each Lender hereby authorizes each of
Barclays, BMO, CS and WF to act as a Lead Arranger in accordance with the terms hereof and the other Loan Documents.
Each Agent hereby agrees to act in its capacity as such upon the express conditions contained herein and the other Loan
Documents, as applicable. Anything herein to the contrary notwithstanding, none of the Lead Arrangers or the other Agents listed on the
cover page hereof (or any of their respective Affiliates or branches) shall have any powers, duties or responsibilities under this Agreement or
any of the other Loan Documents, except (a) in its capacity, as applicable, as the Administrative Agent, the Collateral Agent or a Lender
hereunder and (b) as provided in Section 11.01(b)(iv), and such Persons shall have the benefit of this Article X. Without limiting the
foregoing, none of the Lenders or other Persons so identified shall have or be deemed to have any agency or fiduciary or trust relationship
with any Lender, Holdings, the Borrower or any of their respective Subsidiaries. Each Lender acknowledges that it has not relied, and will
not rely, on any of the Lenders or other Persons so identified in deciding to enter into this Agreement or in taking or not taking action
hereunder. Any Agent may resign from such role at any time, with immediate effect, by giving prior written notice thereof to the
Administrative Agent and Borrower.
Section 10.09
Resignation of Administrative Agent or Collateral Agent
. The Administrative Agent or the Collateral Agent may at any time give notice of its resignation to the Lenders and the
Borrower. Upon receipt of any such notice of resignation, the Required Lenders shall have the right, subject to the consent of the Borrower
(such consent not to be unreasonably withheld, conditioned or delayed), at all times other than during the existence of a Specified Event of
Default, to appoint a successor, which shall be a Lender or a bank with an office in the United States, or an Affiliate or branch of any such
Lender or bank with an office in the United States. If no such successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within thirty days after the retiring Administrative Agent or Collateral Agent, as applicable, gives notice of its
resignation, then the retiring Administrative Agent or Collateral Agent, as applicable, may on behalf of the Lenders, appoint a successor
Administrative Agent or Collateral Agent, as applicable, meeting the qualifications set forth above; provided that if the Administrative Agent
or Collateral Agent, as applicable, shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then
such resignation shall nonetheless become effective in accordance with such notice and (a) the retiring Administrative Agent or Collateral
Agent, as applicable, 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 or Collateral Agent on behalf of the Lenders under any of the Loan
Documents, the retiring Agent shall continue to hold such collateral security until such time as a successor of such Agent is appointed) and
(b) except for any indemnity payments or other amounts owed to the retiring or retired Administrative Agents, all payments, communications
and determinations provided to be made by, to or through the Administrative Agent shall instead be made by or to each Lender directly, until
such time as the Required Lenders appoint a successor Administrative Agent as provided for above in this Section. If neither the Required
Lenders nor the Administrative Agent have appointed a successor Administrative Agent, the Required Lenders shall be deemed to have
succeeded to and become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent (subject to the proviso
in the sentence above). Upon the acceptance of a successor’s appointment as Administrative Agent or Collateral Agent, as applicable,
hereunder and upon the execution and filing or recording of such financing statements, or amendments thereto, and such other instruments or
notices, as may be necessary or appropriate, or as the Required Lenders may request, in order to perfect or continue the perfection of the
Liens granted or purported to be granted by the Collateral Documents, such successor shall succeed to and become vested with all of the
rights, powers, privileges and duties of the retiring (or retired) Administrative Agent or Collateral Agent, as applicable (other than any rights
to indemnity payments or other amounts owed to the retiring or retired Administrative Agent), and the retiring Administrative Agent or
Collateral Agent, as applicable, shall be discharged from all of its
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duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this Section
10.09). The fees payable by the Borrower to a successor Administrative Agent or Collateral Agent, as applicable, shall be the same as those
payable to its predecessor unless otherwise agreed between the Borrower and such successor. After the retiring Agent’s resignation
hereunder and under the other Loan Documents, the provisions of this Article X and Sections 10.07, 11.04 and 11.05 shall continue in effect
for the benefit of such retiring Agent, its sub-agents and their respective Agent-Related Persons in respect of any actions taken or omitted to
be taken by any of them while the retiring Agent was acting as Administrative Agent or Collateral Agent, as applicable.
Section 10.10
Administrative Agent May File Proofs of Claim; Credit Bidding
. In case of the pendency of any case or proceeding under any Debtor Relief Law or any other judicial proceeding relative to any
Loan Party, the Administrative Agent (irrespective of whether the principal of any Loan or in respect of Letter of Credit Obligations shall
then be due and payable as herein expressed or by declaration or otherwise and irrespective of whether the Administrative Agent shall have
made any demand on the Borrower) shall be entitled and empowered (but not obligated), by intervention in such case or proceeding or
otherwise:
(a)
to file a verified statement pursuant to rule 2019 of the Federal Rules of Bankruptcy Procedure or any comparable
provision of any other Debtor Relief Law that, in its sole opinion, complies with such rule’s or Debtor Relief Law’s disclosure requirements
for entities representing more than one creditor;
(b)
to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans,
Letter of Credit Obligations and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or
advisable in order to have the claims of the Lenders, the Issuing Banks and the Administrative Agent (including any claim for the reasonable
compensation, expenses, fees, disbursements and advances of the Lenders, the Issuing Banks and the Administrative Agent and their
respective agents and counsel and all other amounts due the Lenders, the Issuing Banks and the Administrative Agent under Sections 2.11
and 11.04) allowed in such judicial case or proceeding; and
(c)
to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the
same;
and any custodian, receiver, interim receiver, receiver and manager, monitor, assignee, liquidator, sequestrator, trustee, or other similar
official in any such judicial proceeding is hereby authorized by each Lender and each Issuing Bank to make such payments to the
Administrative Agent and, in the event that the Administrative Agent shall consent to the making of such payments directly to the Lenders
and the Issuing Banks, to pay to the Administrative Agent any amount due for the reasonable compensation, expenses, disbursements, fees,
and advances of the Agents and their respective agents and counsel, and any other amounts due the Administrative Agent under Sections 2.11
and 11.04. To the extent that the payment of any such compensation, expenses, disbursements, fees, and advances of the Administrative
Agent, its agents and counsel, and any other amounts due the Administrative Agent under Sections 2.11 and 11.04 out of the estate in any
such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the Lenders or the Issuing Banks may be entitled to receive in such
proceeding whether in liquidation or under any plan of reorganization, arrangement or proposal or otherwise.
Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on
behalf of any Lender or any Issuing Bank any proposed plan of reorganization, arrangement, adjustment or composition, proposal or similar
dispositive restructuring plan
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affecting the Obligations or the rights of any Lender or any Issuing Bank or to authorize the Administrative Agent to vote in respect of the
claim of any Lender or any Issuing Bank in any such case or proceeding.
The Secured Parties hereby irrevocably authorize the Administrative Agent, at the direction of the Required Lenders, to credit bid
all or any portion of the Obligations (including accepting some or all of the Collateral in satisfaction of some or all of the Obligations
pursuant to a deed in lieu of foreclosure or otherwise) and in such manner purchase (either directly or through one or more acquisition
vehicles so long as no Lender is prohibited from owning an interest therein) all or any portion of the Collateral (i) at any sale thereof
conducted under the provisions of the Bankruptcy Code, including under Sections 363, 1123 or 1129 of the Bankruptcy Code, any
comparable provisions of any other Debtor Relief Law, or any similar Laws in any other jurisdictions to which a Loan Party is subject, (ii) at
any other sale or foreclosure or acceptance of collateral in lieu of debt conducted by (or with the consent or at the direction of) the
Administrative Agent (whether by judicial action or otherwise) in accordance with any applicable Law. In connection with any such credit
bid and purchase, the Obligations owed to the Secured Parties shall be entitled to be, and shall be, credit bid on a ratable basis (with
Obligations with respect to contingent or unliquidated claims receiving contingent interests in the acquired assets on a ratable basis that
would vest upon the liquidation of such claims in an amount proportional to the liquidated portion of the contingent claim amount used in
allocating the contingent interests) in the asset or assets so purchased (or in the Equity Interests or debt instruments of the acquisition vehicle
or vehicles that are used to consummate such purchase). In connection with any such bid (A) the Administrative Agent shall be authorized to
form one or more acquisition vehicles to make a bid, (B) to adopt documents providing for the governance of the acquisition vehicle or
vehicles (provided that any actions by the Administrative Agent with respect to such acquisition vehicle or vehicles, including any
disposition of the assets or Equity Interests thereof, shall be governed, directly or indirectly, by the vote of the Required Lenders, irrespective
of the termination of this Agreement and without giving effect to the limitations on actions by the Required Lenders contained in Section
11.01 of this Agreement), (C) the Administrative Agent shall be authorized to assign the relevant Obligations to any such acquisition vehicle
pro rata by the Lenders, as a result of which each of the Lenders shall be deemed to have received a pro rata portion of any Equity Interests
and/or debt instruments issued by such an acquisition vehicle on account of the assignment of the Obligations to be credit bid, all without the
need for any Secured Party or acquisition vehicle to take any further action and (D) to the extent that Obligations that are assigned to an
acquisition vehicle are not used to acquire Collateral for any reason (as a result of another bid being higher or better, because the amount of
Obligations assigned to the acquisition vehicle exceeds the amount of debt credit bid by the acquisition vehicle or otherwise), such
Obligations shall automatically be reassigned to the Lenders pro rata and the Equity Interests and/or debt instruments issued by any
acquisition vehicle on account of the Obligations that had been assigned to the acquisition vehicle shall automatically be cancelled, without
the need for any Secured Party or any acquisition vehicle to take any further action.
Section 10.11
Collateral and Guaranty Matters
.
(a)
Each Agent, each Lender (including in its capacities as a potential Cash Management Bank and a potential Hedge
Bank), each Issuing Bank and each other Secured Party irrevocably authorizes the Administrative Agent and the Collateral Agent to be the
agent for and representative of the Lenders and Issuing Bank with respect to the Guaranty, the Collateral and the Collateral Documents and
agrees that, notwithstanding anything to the contrary in any Loan Documents:
(i)
Liens on any property granted to or held by an Agent or in favor of any Secured Party under any Loan
Document will be automatically and immediately released, and each Secured Party irrevocably authorizes and directs the Agents
to enter into, and each Secured Party and Agent agrees that it will enter into, the necessary or advisable documents requested by
the Borrower and
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associated therewith, upon the occurrence of any of the following events (each, a “Lien Release Event”),
(A)
the payment in full in cash of all the Obligations (other than Cash Management
Obligations, Obligations in respect of Secured Hedge Agreements and contingent obligations in respect of which no
claim has been made);
(B)
a transfer of the property subject to such Lien as part of, or in connection with, a
transaction that is permitted (or not prohibited) by the terms of the Loan Documents to any Person that is not a Loan
Party;
(C)
with respect to property owned by any Guarantor (including any Co-Borrower
subject to the provision in clause (iii) below) or with respect to which any Guarantor has rights (with respect to the
rights of such Guarantor), the release of such Guarantor from its obligations under its Guaranty pursuant to a Guaranty
Release Event;
(D)
the approval, authorization or ratification of the release of such Lien by the
Required Lenders or such percentage as may be required pursuant to Section 11.01;
(E)
such property becoming an Excluded Asset, Excluded Equity Interest or an asset
owned by an Excluded Subsidiary or with respect to which an Excluded Subsidiary (and no other Loan Party) has
rights;
(F)
as to the assets owned by such Excluded Subsidiary (or with respect to which an
Excluded Subsidiary (and no other Loan Party) has rights), upon any Person becoming an Excluded Subsidiary;
(G)
any such Securitization Assets becoming subject to a Securitization Financing to
the extent required by the terms of such Securitization Financing;
(ii)
upon the request of the Borrower (such request, the “Release/Subordination Event”) it will release or
subordinate any Lien on any property granted to or held by the Administrative Agent or the Collateral Agent under any Loan
Document to the holder of any Lien on such property that is permitted by Section 7.01(d);
(iii)
a Subsidiary Guarantor (including any Co-Borrower) will be automatically and immediately released from
its obligations under the Guaranty and, with respect to any Co-Borrower, its obligations hereunder as a Co-Borrower, upon (A)
such Subsidiary Guarantor ceasing to be a Subsidiary of the Borrower, (B) such Subsidiary Guarantor ceasing to be a Material
Subsidiary, unless and until it does not constitute an Excluded Subsidiary per the Borrower’s designation, in its sole discretion,
under the last paragraph of the definition of “Excluded Subsidiary” or (C) such Subsidiary Guarantor becoming an Excluded
Subsidiary (subject to the (1) Borrower’s right to designate or redesignate such Excluded Subsidiary as a Subsidiary Guarantor
under the last paragraph of the definition of Excluded Subsidiary, and (2) other than pursuant to clause (a) of the definition thereof,
to the extent a result of the transfer of Equity Interests in such Subsidiary Guarantor to an Affiliate of the Borrower) as a result of a
transaction permitted hereunder (clauses (A)-(C), each a “Guaranty Release Event”); provided that notwithstanding anything to
the contrary in any Loan Document no Subsidiary Guarantor will be released from its obligations under the Guaranty upon a sale
of less than all of such Subsidiary’s Equity Interests, unless such sale is a good faith disposition to a bona fide unaffiliated third
party for fair market value and for bona fide business purposes, and each Secured Party irrevocably authorizes and
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directs the Agents to enter into, and each Agent agrees it will enter into, the necessary and advisable documents requested by the
Borrower to (1) release (or acknowledge the release of) such Subsidiary Guarantor from its obligations under the Guaranty and (2)
release (or acknowledge the release of) any Liens granted by such Subsidiary or Liens on the Equity Interests of such Subsidiary;
provided, that in the case of any Co-Borrower, any Loans borrowed by such Co-Borrower shall have been expressly assumed by
the Borrower or another Co-Borrower.
(iv)
the Administrative Agent and the Collateral Agent will exclusively exercise the rights and remedies under
the Loan Documents, and neither the Lenders nor any other Secured Party will exercise such rights and remedies (other than the
Required Lenders exercising such rights and remedies through the Administrative Agent); provided that the foregoing shall not
preclude any Lender from exercising any right of set-off in accordance with the provisions of Section 11.09, enforcing compliance
with the provisions set forth in Section 11.01(b) or from exercising rights and remedies (other than the enforcement of Collateral)
with respect to any payment default after the occurrence of the Maturity Date with respect to any Loans made by it or filing proofs
of claim or appearing and filing pleadings on its own behalf during the pendency of a case or proceeding relative to any Loan
Party under any Debtor Relief Law; and
(v)
the Administrative Agent and Collateral Agent shall, and the Lenders and other Secured Parties irrevocably
authorize and instruct the Administrative Agent and Collateral Agent to, from time to time on and after the Closing Date, without
any further consent of any Lender counterparty to any Cash Management Obligation or Secured Hedge Agreement or other
Secured Party, (i) enter into any Intercreditor Agreement or other intercreditor agreement contemplated hereunder with the
collateral agent or other representative of the holders of Indebtedness that is secured by a Lien on Collateral the entering into of
which is expressly provided for (including with respect to priority) under this Agreement or (ii) subordinate any Lien on any
property granted to or held by the Administrative Agent or the Collateral Agent under any Loan Document to the holder of any
Permitted Lien on such property in respect of any Indebtedness that has priority as a matter of law or is expressly permitted
hereunder to be incurred and secured on a priority lien basis to the Liens securing Obligations.
(b)
Each Agent, each Lender and each other Secured Party agrees that it will promptly take such action and execute any
such documents in a form reasonably satisfactory to the Administrative Agent as may be reasonably requested by the Borrower (such actions
and such execution, the “Release Actions”), at the Borrower’s sole cost and expense, in connection with a Lien Release Event,
Release/Subordination Event or Guaranty Release Event and that such actions are not discretionary. Without limitation, the Release Actions
may include, as applicable, (a) executing (if required) and delivering to the Loan Parties (or any designee of the Loan Parties) any such lien
releases, discharges of security interests, pledges and guarantees and other similar discharge or release documents, as are reasonably
requested by a Loan Party in connection with the release, as of record, of the Liens (and all notices of security interests and Liens previously
filed) the subject of a Lien Release Event or Release/Subordination Event or the release of any applicable Guarantee in connection with a
Guaranty Release Event and (b) delivering to the Loan Parties (or any designee of the Loan Parties) all instruments evidencing pledged debt
and all equity certificates and any other collateral previously delivered in physical form by the Loan Parties to a Secured Party.
In connection with any Lien Release Event, Release/Subordination Event, Guaranty Release Event or Release Action, each of the
Collateral Agent, the Administrative Agent and each Secured Party shall be entitled to rely and shall rely exclusively on an officer’s
certificate of the Borrower (the “Release Certificate”) confirming that (a) such Lien Release Event, Release/Subordination Event or a
Guaranty Release Event, as applicable, has occurred or will upon consummation of one or more identified transactions (an “Identified
Transaction”) occur, (b) the conditions to any such Lien Release Event,
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Release/Subordination Event or Guaranty Release Event have occurred or will occur upon consummation of an Identified Transaction, and
(c) that any such Identified Transaction is permitted by (or not prohibited by) the Loan Documents. The Collateral Agent and the
Administrative Agent will be fully exculpated from any liability and shall be fully protected and shall not have any liability whatsoever to
any Secured Party as a result of such reliance or the consummation of any Release Action. A Release Certificate may be delivered in
advance of the consummation of any applicable Identified Transaction.
Each Lender and each Secured Party irrevocably authorizes and irrevocably directs the Collateral Agent and the Administrative
Agent to take the Release Actions and consents to reliance on the Release Certificate. The Secured Parties agree not to give any Agent any
instruction or direction inconsistent with the provisions of this Section 10.11. Neither the Administrative Agent nor the Collateral Agent
shall be responsible for, or have a duty to ascertain or inquire into, any statement in a Release Certificate, the compliance of any Identified
Transaction with the terms of a Loan Document, any representation or warranty regarding the existence, value or collectability of the
Collateral, the existence, priority or perfection of the Collateral Agent’s Lien thereon, or contained in any certificate prepared or delivered by
any Loan Party in connection with the Collateral or compliance with the terms set forth above or in a Loan Document, nor shall the
Administrative Agent or Collateral Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the
Collateral or validity, perfection or priority of any lien thereon.
Each relevant Agent, each Lender and each other Secured Party agrees that following its receipt of an applicable Release
Certificate it will take all Release Actions promptly upon request of the Borrower and in any event not later than the date that is (i) the third
Business Day following the date Release Certificate is delivered to the Administrative Agent and (ii) the date any applicable Identified
Transaction described in the Release Certificate is consummated (such latter date, the “Release Date”), Notwithstanding the foregoing,
nothing set forth in this Section 10.11 shall relieve or release any Loan Party from any liability resulting from a Default or Event of Default
that results from an Identified Transaction or misrepresentation or omission in any Release Certificate.
(c)
Anything contained in any of the Loan Documents to the contrary notwithstanding, each Agent, each Lender and each
Secured Party hereby agree that:
(i)
no Lender or other Secured Party shall have any right individually to realize upon any of the Collateral or to
enforce the Guaranty or any other Loan Document or enforce any rights or remedies thereunder, it being understood and agreed
that all powers, rights and remedies hereunder and under any of the Loan Documents may be exercised solely by the
Administrative Agent or the Collateral Agent, as applicable, for the benefit of the Lenders in accordance with the terms hereof and
thereof, and all powers, rights and remedies under the Collateral Documents may be exercised solely by the Collateral Agent for
the benefit of the Lenders in accordance with the terms thereof;
(ii)
in the event of a foreclosure or similar enforcement 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 Bankruptcy Code (or any comparable provision(s) of any other applicable Debtor Relief Law)), the
Collateral Agent or the Administrative Agent, as agent for and representative of Lenders (but not any Lender or Lenders in its or
their respective individual capacities), shall be entitled, upon instructions from the Required Lenders to be the purchaser or
licensor of any or all of such Collateral at any such sale or other disposition, and the Collateral Agent, as agent for and
representative of Lenders (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
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payment of the purchase price for all or any portion of the Collateral sold at any such sale or disposition, to use and apply any of
the Obligations as a credit on account of the purchase price for any collateral payable by the Collateral Agent at such sale or other
disposition;
(iii)
no provision of any Loan Documents shall require the creation, perfection or maintenance of pledges of or
security interests in, or the obtaining of title insurance or abstracts with respect to, any Excluded Assets, any Excluded Equity
Interests and any other particular assets, if and for so long as, in the reasonable judgment of the Collateral Agent, the cost of
creating, perfecting or maintaining such pledges or security interests in such other particular assets or obtaining title insurance or
abstracts in respect of such other particular assets is excessive in view of the fair market value of such assets or the practical
benefit to the Lenders afforded thereby;
(iv)
the Collateral Agent may grant extensions of time for the creation or perfection of security interests in or the
obtaining of title insurance and surveys with respect to particular assets (including extensions beyond the Closing Date for the
creation or perfection of security interests in the assets of the Loan Parties on such date) where it reasonably determines, in
consultation with the Borrower, that creation or perfection cannot be accomplished without undue effort or expense by the time or
times at which it would otherwise be required by this Agreement or the Collateral Documents.
Section 10.12
Appointment of Supplemental Administrative Agents
.
(a)
It is the purpose of this Agreement and the other Loan Documents that there shall be no violation of any Law of any
jurisdiction denying or restricting the right of banking corporations or associations to transact business as agent or trustee in such
jurisdiction. It is recognized that in case of litigation under this Agreement or any of the other Loan Documents, and in particular in case of
the enforcement of any of the Loan Documents, or in case the Administrative Agent deems that by reason of any present or future Law of any
jurisdiction it may not exercise any of the rights, powers or remedies granted herein or in any of the other Loan Documents or take any other
action which may be desirable or necessary in connection therewith, the Administrative Agent is hereby authorized to appoint an additional
individual or institution selected by the Administrative Agent in its sole discretion as a separate trustee, co-trustee, administrative agent,
collateral agent, administrative sub-agent or administrative co-agent (any such additional individual or institution being referred to herein
individually, as a “Supplemental Administrative Agent” and, collectively, as “Supplemental Administrative Agents”).
(b)
In the event that the Administrative Agent appoints a Supplemental Administrative Agent with respect to any
Collateral, (i) each and every right, power, privilege or duty expressed or intended by this Agreement or any of the other Loan Documents to
be exercised by or vested in or conveyed to the Administrative Agent with respect to such Collateral shall be exercisable by and vest in such
Supplemental Administrative Agent to the extent, and only to the extent, necessary to enable such Supplemental Administrative Agent to
exercise such rights, powers and privileges with respect to such Collateral and to perform such duties with respect to such Collateral, and
every covenant and obligation contained in the Loan Documents and necessary to the exercise or performance thereof by such Supplemental
Administrative Agent shall run to and be enforceable by either the Administrative Agent or such Supplemental Administrative Agent, and (ii)
the provisions of this Article X and of Sections 11.04 and 11.05 that refer to the Administrative Agent shall inure to the benefit of such
Supplemental Administrative Agent and all references therein to the Administrative Agent shall be deemed to be references to the
Administrative Agent and/or such Supplemental Administrative Agent, as the context may require.
(c)
Should any instrument in writing from any Loan Party be required by any Supplemental Administrative Agent so
appointed by the Administrative Agent for more fully and certainly vesting in and
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confirming to him or it such rights, powers, privileges and duties, the Borrower or Holdings, as applicable, shall, or shall cause such Loan
Party to, execute, acknowledge and deliver any and all such instruments promptly upon request by the Administrative Agent. In case any
Supplemental Administrative Agent, or a successor thereto, shall die, become incapable of acting, resign or be removed, all the rights,
powers, privileges and duties of such Supplemental Administrative Agent, to the extent permitted by Law, shall vest in and be exercised by
the Administrative Agent until the appointment of a new Supplemental Administrative Agent.
Section 10.13
Intercreditor Agreements
.
Notwithstanding anything to the contrary set forth in any Loan Document, to the extent the Administrative Agent or Collateral
Agent enters into any Intercreditor Agreement reasonably acceptable to the Borrower, this Agreement will be subject to the terms and
provisions of such Intercreditor Agreement. In the event of any inconsistency between the provisions of this Agreement or any other Loan
Document and any such Intercreditor Agreement, the provisions of such Intercreditor Agreement govern and control. The Secured Parties
acknowledge and agree that each Agent is (i) authorized and instructed to enter into any Intercreditor Agreement to be executed on the
Closing Date with respect to Indebtedness incurred on the Closing Date pursuant to Section 7.03(b)(i)(A) and 7.03(b)(ii) and (ii) authorized
to, and each Agent agrees that, with respect to any secured Indebtedness, upon request by the Borrower, it shall, enter into an Intercreditor
Agreement contemplated hereunder with respect to such Indebtedness with the collateral agent or other Debt Representative of the holders of
such Indebtedness that is secured by a Lien on Collateral the entering into of which is expressly provided for (including with respect to
priority) under this Agreement. The Secured Parties hereby authorize and instruct the Administrative Agent and the Collateral Agent to (a)
enter into any such Intercreditor Agreement executed on the Closing Date or any such other Intercreditor Agreement, (b) bind the Secured
Parties on the terms set forth in any such Intercreditor Agreement and (c) perform and observe its obligations under any such Intercreditor
Agreement. The Agents and each Secured Party agree that the Agents shall be entitled to rely and shall rely exclusively on an officer’s
certificate of the Borrower in determining whether it is authorized or instructed to enter into an Intercreditor Agreement pursuant to this
Section. Each Secured Party covenants and agrees not to give the Collateral Agent or Administrative Agent any instruction that is not
consistent with the provisions of this Section 10.13. In furtherance of the foregoing, notwithstanding anything to the contrary set forth
herein, to the extent that any Loan Party is required to give physical possession or control over or with respect to any Collateral to the
Administrative Agent, the Collateral Agent, any other Agent or any Lender under this Agreement or any of the other Loan Documents, such
requirement to give possession or control shall be satisfied if such possession or control is given to a Debt Representative for any
Indebtedness that is secured by a Lien that is either pari passu or senior to the Liens on such Collateral securing the Obligations, in each case,
in accordance with the Closing Date ABL Intercreditor Agreement and any other Intercreditor Agreement.
Section 10.14
Secured Cash Management Agreements and Secured Hedge Agreements
. Except as otherwise expressly set forth herein or in any Guaranty or any Collateral Document, no Cash Management Bank or
Hedge Bank that obtains the benefits of Section 9.03, any Guaranty or any Collateral by virtue 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 or any Guaranty (including the release or impairment of any Collateral or
Guaranty) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan
Documents. Notwithstanding any other provision of this Article X to the contrary, the Administrative Agent shall not be required to verify
the payment of, or that other satisfactory arrangements have been made with respect to, Cash Management Obligations or Obligations arising
under Secured Hedge Agreements.
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Section 10.15
Withholding Taxes
. To the extent required by any applicable Law, the Administrative Agent may withhold from any payment to any Lender an
amount equivalent to any applicable withholding tax. If any Governmental Authority asserts a claim that the Administrative Agent did not
properly withhold tax from amounts paid to or for the account of any Lender because the appropriate form was not delivered or was not
properly executed or because such Lender failed to notify the Administrative Agent of a change in circumstance which rendered the
exemption from, or reduction of, withholding tax ineffective or for any other reason, or if the Administrative Agent reasonably determines
that a payment was made to a Lender pursuant to this Agreement without deduction of applicable withholding tax from such payment, such
Lender shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative Agent as Tax or
otherwise, including any penalties or interest and together with all expenses (including legal expenses, allocated internal costs and out-of-
pocket expenses) incurred.
Section 10.16
Certain ERISA Matters
.
(a)
Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y)
covenants, from the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit
of, the Administrative Agent and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that at least
one of the following is and will be true:
(i)
such Lender is not using “plan assets” (within the meaning of Section 3(42) of ERISA or otherwise) of one or
more Benefit Plans with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans,
the Commitments or this Agreement,
(ii)
the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain
transactions determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain
transactions involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving
insurance company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective
investment funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable
with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments
and this Agreement,
(iii)
(A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the
meaning of Part VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such
Lender to enter into, participate in, administer and perform the Loans, the Commitments and this Agreement, (C) the entrance
into, participation in, administration of and performance of the Loans, the Commitments and this Agreement satisfies the
requirements of sub-sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the
requirements of subsection (a) of Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in,
administration of and performance of the Loans, the Commitments and this Agreement, or
(iv)
such other representation, warranty and covenant as may be agreed in writing between the Administrative
Agent, in its sole discretion, and such Lender.
(b)
In addition, unless either (1) sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or
(2) a Lender has provided another representation, warranty and covenant in
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accordance with sub-clause (iv) in the immediately preceding clause (a), such Lender further (x) represents and warrants, as of the date such
Person became a Lender party hereto, to, and (y) covenants, from the date such Person became a Lender party hereto to the date such Person
ceases being a Lender party hereto, for the benefit of, the Administrative Agent and not, for the avoidance of doubt, to or for the benefit of
the Borrower or any other Loan Party, that the Administrative Agent is not a fiduciary with respect to the assets of such Lender involved in
such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments and this Agreement
(including in connection with the reservation or exercise of any rights by the Administrative Agent under this Agreement, any Loan
Document or any documents related hereto or thereto).
Section 11.01
Amendments, Waivers, Etc.
ARTICLE XI.
MISCELLANEOUS
(a)
General Rule. Except as otherwise set forth in this Agreement, no amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the Borrower or any other Loan Party therefrom, shall be
effective unless in writing signed by the Required Lenders (or the Administrative Agent on behalf of the Required Lenders) and the Borrower
or the applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent, and each such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which given.
(b)
consent shall:
Specific Lender Approvals. Notwithstanding the provisions of Section 11.01(a), no such amendment, waiver or
(i)
extend or increase the Commitment of any Lender or extend the final expiration date of any Letter of Credit
beyond the Letter of Credit Expiration Date, without the written consent of such Lender (it being understood that a waiver of any
condition precedent set forth in Section 4.02 or the waiver of any Default, Event of Default, mandatory prepayment or mandatory
reduction of the Commitments shall not constitute an extension or increase of any Commitment of any Lender);
(ii)
postpone any date scheduled for, or reduce the amount of, any payment of principal, interest or fees with
respect to any Loan or Letter of Credit or with respect to any fees payable under Section 2.11(b) without the written consent of
each Lender entitled to such payment of principal, interest or fees, it being understood that (i) the waiver of (or amendment to the
terms of) any mandatory prepayment of the Loans shall not constitute a postponement of any date scheduled for the payment of
principal, interest or fees and (ii) a waiver of any condition precedent set forth in Section 4.02 or the waiver of any Default (other
than a Default under Section 9.01(a)) or mandatory reduction of the Commitments shall not constitute a postponement of any date
scheduled for, or a reduction in the amount of, any payment of principal, interest or fees;
(iii)
reduce the principal of, or the rate of interest specified herein on, any Loan or Letter of Credit or any fees or
other amounts payable hereunder or under any other Loan Document without the written consent of each Lender entitled to such
principal, interest or Person entitled to such fee or other amount, as applicable, it being understood that (i) [reserved], (ii)
[reserved] and (iii) any change in the definition of “Average Historical Excess Availability” used in the calculations of such
interest or fees (or the component definitions thereof) shall not constitute a reduction in the rate of interest specified herein or any
fees or other amounts payable hereunder or under any other Loan Document; provided that (A) only the consent of the Required
Lenders shall be necessary to amend the definition of “Default Rate” and (B) with respect to any Facility, only
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the consent of the Required Facility Lenders shall be necessary to waive any obligation of the Borrower to pay interest at the
Default Rate with respect to such Facility;
(iv)
change any provision of this Section 11.01 or the definition of “Required Lenders,” “Required Facility
Lenders”, “Super Majority Lenders” or “Pro Rata Share” or any other provision specifying the number of Lenders or portion of
the Loans or Commitments required to take any action under the Loan Documents, without the written consent of each Lender;
(v)
other than in connection with a transfer or other transaction permitted (or not prohibited) under the Loan
Documents, release all or substantially all of the Collateral in any transaction or series of related transactions, without the written
consent of each Lender;
(vi)
other than in connection with a transfer or other transaction permitted (or not prohibited) under the Loan
Documents, release all or substantially all of the aggregate value of the Guaranty or all or substantially all of the Guarantors,
without the written consent of each Lender;
(vii)
modify Section 2.15, including in a manner that would by its terms alter the pro rata sharing of payments
required thereby, 2.07(b)(ii) or 9.03 without the written consent of each Lender directly and adversely affected thereby;
(viii)
increase the percentages set forth in the definitions of “Accounts Receivable Component” and/or
“Inventory Component” and/or “Qualified Cash Component”, without the consent of the Super Majority Lenders;
(ix)
change the definition of the term “Borrowing Base”, or any component definition thereof (including the
definition of “Eligible Accounts Receivable,” “Eligible Credit Insured Accounts” and/or “Eligible Inventory”), the effect of which
would be to increase amounts available to be borrowed, without the consent of the Super Majority Lenders; provided, that the
foregoing shall not limit the ability of the Administrative Agent to implement, change or eliminate Reserves in its Permitted
Discretion as permitted hereunder without the prior written consent of any Lender;
(x)
change the currency in which any Loan or Letter of Credit Borrowing is denominated without the written
consent of each Lender holding such Loans or each Issuing Bank holding such Letter of Credit Borrowings;
(xi)
change the definition of “Alternative Currencies” or the related process for designating an Alternative
Currency as set forth in Section 2.01(b)(i) without the written consent of each Lender; or
(xii)
amend or modify any term or provision of any Loan Document to permit the issuance or incurrence of any
Indebtedness for borrowed money (including any exchange of existing Indebtedness that results in another class of Indebtedness
for borrowed money) with respect to which either (x) such Indebtedness is secured by the ABL Priority Collateral and in respect
of which the Liens on the ABL Priority Collateral securing the Obligations of any Class would be contractually subordinated or
(y) Obligations of any Class would be contractually subordinated in right of payment to such Indebtedness (any such other
Indebtedness to which such Liens securing any of the Obligations or such Obligations, as applicable, are subordinated, “Senior
Indebtedness”), in each case, without the written consent of each Lender of such Class directly and adversely affected thereby.
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(c)
Other Approval Requirements. Notwithstanding the provisions of Section 11.02(a) or 11.01(b);
(i)
no amendment, waiver or consent shall, unless in writing and signed by an Issuing Bank in addition to the
Lenders required above, affect the rights or duties of, or any fees or other amounts payable to, such Issuing Bank under this
Agreement, any Issuance Notice or any other Loan Document relating to any Letter of Credit issued or to be issued by it,
(ii)
no amendment, waiver of consent shall, unless in writing and signed by the Swing Line Lender in addition to
the Lenders required above, affect the rights or duties of, or any fees or other amounts payable to, the Swing Line Lender under
this Agreement or any other Loan Document,
(iii)
no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in
addition to the Lenders required above, adversely affect the rights or duties of, or any fees or other amounts payable to, the
Administrative Agent under this Agreement or any other Loan Document,
(iv)
no amendment, waiver or consent shall, unless in writing and signed by the Collateral Agent in addition to
the Lenders required above, adversely affect the rights or duties of, or any fees or other amounts payable to, the Collateral Agent
under this Agreement or any other Loan Document,
(v)
Section 11.07(g) may not be amended, waived or otherwise modified without the consent of each Granting
Lender all or any part of whose Loans are being funded by an SPC at the time of such amendment, waiver or other modification,
(vi)
the consent of the Required Facility Lenders shall be required with respect to any amendment that by its
terms adversely affects the rights of Lenders under such Facility in respect of payments hereunder in a manner different than such
amendment affects other Facilities,
(vii)
this Agreement and the other Loan Documents may be amended (or amended and restated) to effect an
Incremental Amendment and/or Extension Amendment, in each case in accordance with the terms set forth in this Agreement with
respect thereto;
(viii)
any amendment to the definition of “Letter of Credit Percentage” shall require the consent only of the
Borrower, the Administrative Agent and each directly and adversely affected Issuing Bank; and
(ix)
any amendment relating to Revolving Loans denominated in an Alternative Currency shall only require the
Required Facility Lenders in respect of the Tranche 1 Revolving Commitments.
(d)
Intercreditor Agreement. No Lender or Issuing Bank consent is required to effect any amendment or supplement to any
Intercreditor Agreement or any other intercreditor agreement that is (i) for the purpose of adding the holders of Pari Passu Lien Debt, Junior
Lien Debt, Incremental Equivalent Debt, Permitted Pari Passu Secured Refinancing Debt or Permitted Junior Secured Refinancing Debt (or a
Debt Representative with respect to any Indebtedness with respect to which it is a representative or agent) as parties thereto, as expressly
contemplated by the terms of such intercreditor agreement (it being understood that any such amendment or supplement may make such
other changes to the applicable intercreditor agreement as, in the good faith determination of the Administrative Agent, are required to
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effectuate the foregoing) or (ii) expressly contemplated by such Intercreditor Agreement or any other intercreditor agreement.
(e)
Additional Facilities and Replacement Loans.
(i)
Additional Facilities. This Agreement may be amended (or amended and restated) with the written consent of
the Required Lenders, the Administrative Agent and the Borrower (I) to add one or more additional credit facilities to this
Agreement and to permit the extensions of credit from time to time outstanding thereunder and the accrued interest and fees in
respect thereof to share ratably in the benefits of this Agreement and the other Loan Documents with the Loans and the accrued
interest and fees in respect thereof and (II) to include appropriately the Lenders holding such credit facilities in any determination
of the Required Lenders.
(f)
LIBOR Replacement.
(i)
Notwithstanding anything to the contrary herein or in any other Loan Document:
(A)
On March 5, 2021 the Financial Conduct Authority (“FCA”), the regulatory supervisor of USD
LIBOR’s administrator (“IBA”), announced in a public statement the future cessation or loss of representativeness of
overnight/Spot Next, 1-month, 3-month, 6-month and 12- month USD LIBOR tenor settings. On the earlier of (i) the
date that all Available Tenors of USD LIBOR have either permanently or indefinitely ceased to be provided by IBA or
have been announced by the FCA pursuant to public statement or publication of information to be no longer
representative and (ii) the Early Opt-in Effective Date, if the then-current Benchmark is USD LIBOR, the Benchmark
Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any
setting of such Benchmark on such day and all subsequent settings without any amendment to, or further action or
consent of any other party to this Agreement or any other Loan Document. If the Benchmark Replacement is Daily
Simple SOFR, all interest payments will be payable on a quarterly basis.
(B)
Upon the occurrence of a Benchmark Transition Event, the Benchmark Replacement will replace
the then-current Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark
setting at or after 5:00 p.m. on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is
provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or
any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of
objection to such Benchmark Replacement from Lenders comprising the Required Lenders. At any time that the
administrator of the then-current Benchmark has permanently or indefinitely ceased to provide such Benchmark or such
Benchmark has been announced by the regulatory supervisor for the administrator of such Benchmark pursuant to
public statement or publication of information to be no longer representative of the underlying market and economic
reality that such Benchmark is intended to measure and that representativeness will not be restored, the Borrower may
revoke any request for a borrowing of, conversion to or continuation of Loans to be made, converted or continued that
would bear interest by reference to such Benchmark until the Borrower’s receipt of notice from the Administrative
Agent that a Benchmark Replacement has replaced such Benchmark, and, failing that, (i) if such Loans are
denominated in Dollars or Canadian Dollars, the Borrower will be deemed to have converted any such request into a
request for a borrowing of or conversion to Base Rate Loans and (ii) if such Loans are denominated in an Alternative
Currency other than Canadian Dollars, such
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Loans shall be repaid at the end of the Interest Period thereof. During the period referenced in the foregoing sentence,
the component of the Base Rate based upon the Benchmark will not be used in any determination of the Base Rate.
(C)
In connection with the implementation and administration of a Benchmark Replacement, the
Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time
and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing
such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any
other party to this Agreement.
(D)
The Administrative Agent will promptly notify the Borrower and the Lenders of (i) the
implementation of any Benchmark Replacement and (ii) the effectiveness of any Benchmark Replacement Conforming
Changes. Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any
Lender (or group of Lenders) pursuant to this Section 11.01(f), including any determination with respect to a tenor, rate
or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or
refrain from taking any action, will be conclusive and binding absent manifest error and may be made in its or their sole
discretion and without consent from any other party hereto, except, in each case, as expressly required pursuant to this
Section 11.01(f).
(E)
At any time (including in connection with the implementation of a Benchmark Replacement), (i) if
the then-current Benchmark is a term rate (including Term SOFR or USD LIBOR), then the Administrative Agent may
remove any tenor of such Benchmark that is unavailable or non-representative for Benchmark (including Benchmark
Replacement) settings and (ii) the Administrative Agent may reinstate any such previously removed tenor for
Benchmark (including Benchmark Replacement) settings.
(g)
Defaulting Lenders and Disqualified Lenders. Notwithstanding anything to the contrary herein, no Defaulting Lender
shall have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by
its terms requires the consent of all Lenders, the Required Lenders, the Required Facility Lenders, the Super Majority Lenders or each
affected Lender may be effected with the consent of the applicable Lenders other than Defaulting Lenders or Disqualified Lenders), except
that (1) the Commitment of any Defaulting Lender may not be increased or extended without the consent of such Defaulting Lender and (2)
any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting
Lender more adversely than other affected Lenders shall require the consent of such Defaulting Lender. Disqualified Lenders shall be subject
to the provisions of Section 11.27.
Section 11.02
Notices and Other Communications; Facsimile Copies
.
(a)
General. Except in the case of notices and other communications expressly permitted to be given by telephone (and
except as provided in subsection (b) below), all notices and other communications provided for herein shall be in writing and shall be
delivered by hand or overnight courier service, mailed by certified or registered mail or sent by fax as follows, and all notices and other
communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:
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(i)
if to Holdings, the Borrower, the Guarantors, the Issuing Banks, the Swing Line Lender, the Collateral Agent
or the Administrative Agent, to the address, fax number, electronic mail address or telephone number specified for such Person on
Schedule 11.02; and
(ii)
if to any other Lender, to the address, fax number, electronic mail addresses or telephone number specified in
its Administrative Questionnaire.
Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to
have been given when received; notices and other communications sent by fax shall be deemed to have been given when sent (except that, if
not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business
Day for the recipient); and notices deposited in the United States mail with postage prepaid and properly addressed shall be deemed to have
been given within three Business Days of such deposit; provided that no notice to any Agent shall be effective until received by such
Agent. Notices and other communications delivered through electronic communications to the extent provided in subsection (b) below shall
be effective as provided in such subsection (b).
(b)
Electronic Communication. Notices and other communications to any Agent, the Lenders, the Swing Line Lender and
the Issuing Banks hereunder may be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites,
including the Platform) pursuant to procedures approved by the Administrative Agent (it being agreed that e-mail to the address(es) provided
on Schedule 11.02 are approved by the Administrative Agent), provided that the foregoing shall not apply to notices to any Agent, Lender,
Swing Line Lender or the Issuing Banks pursuant to Article II if such Person, as applicable, has notified the Administrative Agent that it is
incapable of receiving notices under such Article by electronic communication. The Administrative Agent or the Borrower may, in its
discretion, agree to accept notices and other communications to it hereunder by electronic communications pursuant to procedures approved
by it provided that approval of such procedures may be limited to particular notices or communications.
(c)
Receipt. Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail
address shall be deemed 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 sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of
business on the next Business Day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be
deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of
notification that such notice or communication is available and identifying the website address therefor.
(d)
Risks of Electronic Communications. Each Loan Party understands that the distribution of materials through an
electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution and agrees and
assumes the risks associated with such electronic distribution, except to the extent caused by the bad faith, willful misconduct or gross
negligence of the Administrative Agent, any Lender, the Swing Line Lender or any Issuing Bank as determined by a final, non-appealable
judgment of a court of competent jurisdiction.
(e)
The Platform. THE PLATFORM IS PROVIDED ‘AS IS’ AND ‘AS AVAILABLE.’ THE AGENT PARTIES (AS
DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE
ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE
BORROWER MATERIALS OR IN THE PLATFORM. NO WARRANTY OF ANY KIND, EXPRESS,
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IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE,
NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY
ANY AGENT PARTY IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall the
Administrative Agent or any of its Agent-Related Persons or any Lead Arranger (collectively, the “Agent Parties”) have any liability to
Holdings, the Borrower, any Lender, the Swing Line Lender, any Issuing Bank or any other Person for losses, claims, damages, liabilities or
expenses of any kind (whether in tort, contract or otherwise) arising out of the Borrower’s or the Administrative Agent’s transmission of
Borrower Materials through the Internet, except to the extent that such losses, claims, damages, liabilities or expenses are determined by a
court of competent jurisdiction by a final and non-appealable judgment to have resulted from the gross negligence or willful misconduct of
such Agent Party; provided, however, that in no event shall any Agent Party have any liability to Holdings, the Borrower, any Lender, the
Swing Line Lender, any Issuing Bank or any other Person for indirect, special, incidental, consequential or punitive damages (as opposed to
direct or actual damages). Each Loan Party, each Lender, each Issuing Bank and each Agent agrees that the Administrative Agent may, but
shall not be obligated to, store any Borrower Materials on the Platform in accordance with the Administrative Agent’s customary document
retention procedures and policies.
(f)
Change of Address. Each of Holdings, the Borrower, the Guarantors, the Administrative Agent, the Swing Line Lender
and the Issuing Banks may change its address, fax or telephone number for notices and other communications hereunder by notice to the
other parties hereto. Each other Lender may change its address, fax or telephone number for notices and other communications hereunder by
notice to the Borrower, the Administrative Agent, the Collateral Agent, the Swing Line Lender and the Issuing Banks. 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, fax number and electronic mail address to which notices and other communications may be sent
and (ii) accurate wire instructions for such Lender.
(g)
Reliance by the Administrative Agent, the Issuing Banks and the Lenders. The Administrative Agent, the Issuing
Banks and the Lenders shall be entitled to rely and act upon any notices (including Committed Loan Notices, Swing Line Loan Requests and
Issuance Notices) purportedly given by or on behalf of the Borrower even if (i) such notices were not made in a manner specified herein,
were incomplete or were not preceded or followed by any other form of notice specified herein, or (ii) the terms thereof, as understood by the
recipient, varied from any confirmation thereof. All telephonic notices to and other telephonic communications with the Administrative
Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents to such recording. The Borrower shall
indemnify the Administrative Agent, the Issuing Banks and the Lenders and each Agent-Related Person 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 Borrower in the absence of gross
negligence, bad faith or willful misconduct as determined in a final and non-appealable judgment by a court of competent jurisdiction.
(h)
Private-Side Information Contacts. Each Public Lender agrees to cause at least one individual at or on behalf of such
Public Lender to at all times have selected the “Private-Side Information” or similar designation on the content declaration screen of the
Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and
applicable Law, including United States federal and state securities Laws, to make reference to information that is not made available through
the “Public-Side Information” portion of the Platform and that may contain Private-Side Information with respect to Holdings, its
Subsidiaries or their respective securities for purposes of United States federal or state securities laws. In the event that any Public Lender
has determined for itself to not access any information disclosed through the Platform or otherwise, such Public Lender acknowledges that (i)
other Lenders may have availed themselves of such information and (ii) neither the Borrower nor the
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Administrative Agent has (A) any responsibility for such Public Lender’s decision to limit the scope of the information it has obtained in
connection with this Agreement and the other Loan Documents and (B) any duty to disclose such information to such Public Lender or to use
such information on behalf of such Public Lender, and shall not be liable for the failure to so disclose or use, such information.
Section 11.03
No Waiver; Cumulative Remedies
. No forbearance, failure or delay by any Lender or any Agent to exercise, and no delay by any such Person in exercising, any
right, remedy, power or privilege hereunder or under any other Loan Document shall impair such right, remedy, power or privilege or operate
as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided,
and provided under each other Loan Document, are cumulative and independent of any rights, remedies, powers and privileges provided by
Law.
Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and
remedies hereunder and under the other Loan Documents against the Borrower and the Co-Borrowers shall be vested exclusively in, and all
actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative
Agent in accordance with Article IX for the benefit of all the Lenders and the Issuing Banks; provided that the foregoing shall not prohibit (i)
the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as
Administrative Agent) hereunder and under the other Loan Documents, (ii) any Issuing Bank or the Swing Line Lender from exercising on
its own behalf the rights and remedies that inure to its benefit (solely in its capacity as an Issuing Bank or the Swing Line Lender, as
applicable) hereunder and under the other Loan Documents, (iii) any Lender from exercising setoff rights in accordance with Section 11.09
(subject to the terms of Section 2.15) or (iv) any Lender from filing proofs of claim (and voting its claims) or appearing and filing pleadings
on its own behalf during the pendency of a case or proceeding relative to the Borrower or any other Loan Party under any Debtor Relief Law;
provided further that if at any time there is no Person acting as Administrative Agent hereunder and under the other Loan Documents, then
(A) the Required Lenders shall have the rights otherwise provided to the Administrative Agent pursuant to Article IX and (B) in addition to
the matters set forth in clauses (ii), (iii) and (iv) of the preceding proviso and subject to Section 2.15, any Lender may, with the consent of the
Required Lenders, enforce any rights or remedies available to it and as authorized by the Required Lenders.
Section 11.04
Attorney Costs and Expenses
. The Borrower and the Co-Borrowers jointly and severally agree (a) if the Closing Date occurs, to pay or reimburse the
Administrative Agent, the Collateral Agent, the Lead Arranger, the Supplemental Administrative Agents, the Issuing Banks and the Swing
Line Lender for all reasonable and documented in reasonable detail out-of-pocket expenses incurred on or after the Closing Date in
connection with the preparation, execution, delivery and administration of this Agreement and the other Loan Documents and any
amendment, waiver, consent or other modification of the provisions hereof and thereof (whether or not the transactions contemplated thereby
are consummated), limited, in the case of legal fees and expenses, to the Attorney Costs of one primary counsel and, if reasonably necessary,
one local counsel in each relevant jurisdiction material to the interests of the Lenders taken as a whole (which may be a single local counsel
acting in multiple material jurisdictions), and (b) to pay or reimburse the Administrative Agent, the Collateral Agent, the Lead Arrangers, the
Supplemental Administrative Agents, the Issuing Banks, the Swing Line Lender and the Lenders for all reasonable and documented in
reasonable detail out-of-pocket costs and expenses incurred in connection with the enforcement of any rights or remedies under this
Agreement or the other Loan Documents (including all such costs and expenses incurred during any legal proceeding, including any case or
proceeding under the Bankruptcy Code or any other Debtor Relief Law, and including all Attorney Costs of one counsel to the
Administrative Agent, the Collateral Agent, the Lead Arrangers, the Supplemental Administrative Agents, the Issuing Banks, the Swing Line
Lender and the Lenders taken as a whole (and, if reasonably necessary, one local counsel in any relevant material jurisdiction (which may be
a single local counsel acting in multiple material jurisdictions) and, solely in the event of an actual or potential conflict of interest between
the Administrative Agent, the Collateral Agent, the Lead Arrangers, the Supplemental Administrative Agents,
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the Issuing Banks, the Swing Line Lender and the Lenders, where the Person or Persons affected by such conflict of interest inform the
Borrower in writing of such conflict of interest, one additional counsel in each relevant material jurisdiction to each group of affected Persons
similarly situated taken as a whole)). The agreements in this Section 11.04 shall survive the termination of the Aggregate Commitments and
repayment of all other Obligations. All amounts due under this Section 11.04 shall be paid promptly following receipt by the Borrower of an
invoice relating thereto setting forth such expenses in reasonable detail. If any Loan Party fails to pay when due any costs, expenses or other
amounts payable by it hereunder or under any Loan Document, such amount may be paid on behalf of such Loan Party by the Administrative
Agent in its sole discretion. Expenses shall be deemed to be documented in reasonable detail only if they provide the detail required to
enable the Borrower, acting in good faith, to determine that such expenses relate to the activities with respect to which reimbursement is
required hereunder. The Borrower and each other Loan Party hereby acknowledge that the Administrative Agent and/or any Lender may
receive a benefit, including a discount, credit or other accommodation, from any of such counsel based on the fees such counsel may receive
on account of their relationship with the Administrative Agent and/or such Lender, including fees paid pursuant to this Agreement or any
other Loan Document.
Section 11.05
Indemnification by the Borrower
and the Co-Borrowers. The Borrower and the Co-Borrowers jointly and severally shall indemnify and hold harmless the
Administrative Agent, any Supplemental Administrative Agent, the Collateral Agent, the Issuing Banks, the Swing Line Lender, each
Lender, each Lead Arranger, each Joint Bookrunner and their respective Affiliates, along with the branches, fronting banks, confirming
banks, advising banks, directors, officers, employees, agents, advisors, partners, shareholders, trustees, controlling persons, and other
representatives of each of the foregoing (collectively, the “Indemnitees”) from and against any and all liabilities, obligations, losses,
damages, penalties, claims, demands, actions, judgments, suits, costs, expenses and disbursements (including Attorney Costs) of any kind or
nature whatsoever which may at any time be imposed on, incurred by or asserted against any such Indemnitee in any way relating to or
arising out of or in connection with (but limited, in the case of legal fees and expenses, to the Attorney Costs of one counsel to all
Indemnitees taken as a whole and, if reasonably necessary, a single local counsel for all Indemnitees taken as a whole in each relevant
jurisdiction that is material to the interest of such Indemnitees (which may be a single local counsel acting in multiple material jurisdictions),
and solely in the case of an actual or potential conflict of interest between Indemnitees (where the Indemnitee affected by such conflict of
interest informs the Borrower in writing of such conflict of interest), one additional counsel in each relevant jurisdiction to each group of
affected Indemnitees similarly situated taken as a whole),
(a)
the execution, delivery, enforcement, performance or administration of any Loan Document or any other agreement,
letter or instrument delivered in connection with the transactions contemplated thereby or the consummation of the transactions contemplated
thereby (including the reliance in good faith by any Indemnitee on any notice purportedly given by or on behalf of the Borrower or any Loan
Party),
(b)
the Transaction,
(c)
any Commitment, Loan, Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by
any Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not
strictly comply with the terms of such Letter of Credit),
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(d)
any actual or alleged presence or release of, or exposure to, any Hazardous Materials on or from any property currently
or formerly owned or operated by the Borrower or any other Loan Party, or any Environmental Claim or Environmental Liability arising out
of the activities or operations of or otherwise related to the Borrower or any other Loan Party, or
(e)
any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based
on contract, tort or any other theory (including any investigation of, preparation for, or defense of any pending or threatened claim,
investigation, litigation or proceeding) and regardless of whether any Indemnitee is a party thereto (all the foregoing, collectively, the
“Indemnified Liabilities”);
provided that such indemnity shall not, as to any Indemnitee, be available to the extent that a court of competent jurisdiction determines in a
final and non-appealable judgment that any such liabilities, obligations, losses, damages, penalties, claims, demands, actions, judgments,
suits, costs, expenses or disbursements resulted from (i) the gross negligence, bad faith or willful misconduct of such Indemnitee or of any
Related Indemnified Person of such Indemnitee, (ii) a material breach of any obligations of such Indemnitee under any Loan Document by
such Indemnitee or Related Indemnified Person, or (iii) any dispute solely among Indemnitees or of any Related Indemnified Person of such
Indemnitee other than any claims against an Indemnitee in its capacity or in fulfilling its role as the Administrative Agent, the Collateral
Agent, an Issuing Bank, the Swing Line Lender or a Lead Arranger (or other Agent role) under the Facility and other than any claims arising
out of any act or omission of the Borrower or any of its Affiliates. To the extent that the undertakings to indemnify and hold harmless set
forth in this Section 11.05 may be unenforceable in whole or in part because they are violative of any applicable law or public policy, the
Borrower and the Co-Borrowers jointly and severally shall contribute the maximum portion that it is permitted to pay and satisfy under
applicable law to the payment and satisfaction of all Indemnified Liabilities incurred by the Indemnitees or any of them. No Indemnitee shall
be liable for any damages arising from the use by others of any information or other materials obtained through Merrill Datasite One,
Intralinks/Intra Agency, Syndtrak or other similar information transmission systems in connection with this Agreement, except to the extent
resulting from the willful misconduct, bad faith or gross negligence of such Indemnitee or any Related Indemnified Person (as determined by
a final and non-appealable judgment of a court of competent jurisdiction), nor shall any Indemnitee or any Loan Party 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
in connection herewith or therewith (whether before or after the Closing Date) (other than, in the case of any Loan Party, in respect of any
such damages incurred or paid by an Indemnitee to a third party). In the case of an investigation, litigation or other proceeding to which the
indemnity in this Section 11.05 applies, such indemnity shall be effective whether or not such investigation, litigation or proceeding is
brought by any Loan Party, its directors, stockholders or creditors or an Indemnitee or any other Person, whether or not any Indemnitee is
otherwise a party thereto and whether or not any of the transactions contemplated hereunder or under any of the other Loan Documents is
consummated. All amounts due under this Section 11.05 (after the determination of a court of competent jurisdiction, if required pursuant to
the terms of this Section 11.05) shall be paid within twenty Business Days after written demand therefor. The agreements in this
Section 11.05 shall survive the resignation of the Administrative Agent, the Collateral Agent, the Swing Line Lender or any Issuing Bank,
replacement of any Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other
Obligations. This Section 11.05 shall not apply to Taxes, except it shall apply to any Taxes that represent losses, claims, damages,
etc. arising from a non-Tax claim (including a value added tax or similar tax charged with respect to the supply of legal or other
services). For the avoidance of doubt and without limiting the foregoing obligations in any manner, neither Jackson Wijaya, nor any other
Affiliate of the Borrower (other than Holdings, the Borrower, and its Restricted Subsidiaries) shall have any liability under this Section 11.05,
and each is hereby released from any liability arising from the Transactions or any other transaction explicitly permitted (or not prohibited)
by the Loan Documents.
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Section 11.06
Marshaling; Payments Set Aside
. None of the Administrative Agent, any Lender, the Collateral Agent or any Issuing Bank shall be under any obligation to
marshal any assets in favor of the Loan Parties or any other Person or against or in payment of any or all of the Obligations. To the extent
that any payment by or on behalf of the Borrower is made to any Agent, any Lender or any Issuing Bank (or to the Administrative Agent, on
behalf of any Lender or any Issuing Bank), or any Agent or any Lender enforces any security interests or exercises its right of setoff, and
such payments or the proceeds of such enforcement or setoff or any part thereof are subsequently invalidated, declared to be or avoided as
fraudulent or preferential or a transfer at undervalue, set aside and/or required (including pursuant to any settlement entered into by such
Agent or such Lender in its discretion) to be repaid to a trustee, receiver, interim receiver, receiver and manager, monitor or any other party,
in connection with any case or proceeding under any Debtor Relief Law or otherwise, then (a) to the extent of such recovery, the obligation
or part thereof originally intended to be satisfied and all Liens, rights and remedies therefor or related thereto, shall be revived and continued
in full force and effect as if such payment or payments had not been made or such enforcement or setoff had not occurred and (b) each
Lender and each Issuing Bank severally agrees to pay to the Administrative Agent upon demand its applicable share (without duplication) of
any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of such demand to the date such
payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect.
Section 11.07
Successors and Assigns
.
(a)
The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that neither Holdings nor the Borrower may, except as permitted by Section 7.04
or 7.10(b), assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative
Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except,
(i)
(ii)
(iii)
Section 11.07, or
to an assignee in accordance with the provisions of subsection (b) of this Section 11.07,
by way of participation in accordance with the provisions of subsection (d) of this Section 11.07,
by way of pledge or assignment of a security interest subject to the restrictions of subsection (f) of this
(iv)
to an SPC in accordance with the provisions of subsection (g) of this Section 11.07 (and any other attempted
assignment or transfer by any party hereto shall be null and void).
Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby, Participants to the extent provided in subsection (d) of this Section 11.07 and, to the extent
expressly contemplated hereby, the Agent-Related Persons of each of the Administrative Agent, the Issuing Banks and the Lenders) any legal
or equitable right, remedy or claim under or by reason of this Agreement.
(b)
Assignments by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights and
obligations under this Agreement, including all or a portion of its Commitment and the Loans (including for purposes of this Section
11.07(b), participations in Letters of Credit, Swing Line Loans and Protective Advances) at the time owing to it; provided that any such
assignment shall be subject to the following conditions:
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(i)
Minimum Amounts.
(A)
in the case of an assignment of the entire remaining amount of the assigning Lender’s Revolving
Commitment and Revolving Loans at the time held by it or in the case of an assignment to a Lender, an Affiliate or
branch of a Lender or an Approved Fund, no minimum amount need be assigned; and
(B)
with respect to any assignment not described in subsection (b)(i)(A) of this Section, such
assignment shall be in an aggregate amount of not less than $5,000,000, unless each of the Administrative Agent, and
so long as no Specified Event of Default has occurred and is continuing at the time of such assignment, the Borrower
otherwise consents (such consent not to be unreasonably withheld or delayed).
(ii)
Proportionate Amounts. Each partial assignment of Revolving Commitments and/or Revolving Loans shall
be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with
respect to the Revolving Commitments and/or Revolving Loans being assigned, except that this clause (ii) shall not (x) apply to
the Swing Line Lender’s rights and obligations in respect of Swing Line Loans or (y) prohibit any Lender from assigning all or a
portion of its rights and obligations among separate Facilities on a non-pro rata basis.
(iii)
Required Consents. No consent shall be required for any assignment except to the extent required by
Section 11.07(b)(i)(B) and the following:
(A)
the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be
required unless (1) a Specified Event of Default has occurred and is continuing at the time of such assignment or
(2) such assignment is made with respect to Revolving Commitments and Revolving Loans, to a Revolving Lender or
an Affiliate of the assigning Revolving Lender;
(B)
the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed)
shall be required if such assignment is to a Person that is not a Lender, an Affiliate or branch of such Lender or an
Approved Fund.
(C)
with respect to assignments of Tranche 1 Revolving Loans and/or Tranche 1 Revolving
Commitments, the Swing Line Lender (such consent not to be unreasonably withheld, conditioned or delayed); and
(D)
with respect to assignments of Tranche 1 Revolving Loans and/or Tranche 1 Revolving
Commitments, each Issuing Bank (such consent not to be unreasonably withheld, conditioned or delayed).
(iv)
Assignment and Assumption. The parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500; provided that (A) the
Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment
and (B) no processing and recordation fee shall be payable in connection with an assignments by or to a Lead Arranger or its
Affiliates or branches. The Eligible Assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative
Questionnaire and any tax forms required under Section 3.01(b), (c), (d) and (e), as applicable. Upon receipt of the processing and
recordation fee and any written consent to assignment required by Section 11.07(b)(iii), the Administrative
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Agent shall promptly accept such Assignment and Assumption and record the information contained therein in the Register.
(v)
No Assignments to Certain Persons. No such assignment shall be made,
(A)
(B)
(C)
to Holdings, the Borrower or any of the Borrower’s Subsidiaries
to any of the Borrower’s Affiliates;
to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender
hereunder, would constitute any of the foregoing persons described in this clause;
(D)
to a natural person (or holding company, investment vehicle or trust for, or owned and operated for
the primary benefit of a natural person); or
(E)
to a Disqualified Lender or Lender who has become a Disqualified Lender.
To the extent that any assignment is purported to be made to a Disqualified Lender, such transaction shall be subject to the applicable
provisions of Section 11.27.
(vi)
Defaulting Lenders Assignments. In connection with any assignment of rights and obligations of any
Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set
forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate
amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of
participations or sub-participations, or other compensating actions, including funding, with the consent of the Borrower and the
Administrative Agent, the applicable Pro Rata Share of Loans previously requested but not funded by the Defaulting Lender, to
each of which the applicable assignee and assignor hereby irrevocably consent), to (A) pay and satisfy in full all payment
liabilities then owed by such Defaulting Lender to the Administrative Agent, the Issuing Banks, the Swing Line Lender and each
other Lender hereunder (and interest accrued thereon), and (B) acquire (and fund as appropriate) its full Pro Rata Share of all
Loans and participations in Letters of Credit, Swing Line Loans and Protective Advances. Notwithstanding the foregoing, in the
event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under applicable
Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be a
Defaulting Lender for all purposes of this Agreement until such compliance occurs.
Subject to acceptance and recording thereof by the Administrative Agent pursuant to clause (c) of this Section 11.07, from and after the
effective date specified in each Assignment and Assumption, the assignee thereunder shall be a party to this Agreement (except in the case of
an assignment to or purchase by Holdings, the Borrower or any of Holdings’ Subsidiaries) and, to the extent of the interest assigned by such
Assignment and Assumption and as permitted by this Section 11.07, have the rights and obligations of a Lender under this Agreement, and
the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its
obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and
obligations 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, 11.04 and 11.05 with respect to facts and circumstances occurring prior to the effective date of such assignment); provided
that anything contained in any of the Loan Documents to the contrary notwithstanding, each Issuing Bank shall continue to have all rights
and
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obligations with respect to any Letters of Credit issued by it until the cancellation or expiration of such Letters of Credit and the
reimbursement of any amounts drawn thereunder. Upon request, and the surrender by the assigning Lender of its applicable Notes, the
Borrower (at its expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of rights or
obligations under this Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such
Lender of a participation in such rights and obligations in accordance with subsection (d) of this Section 11.07.
(c)
Register. The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrower (and such
agency being solely for Tax purposes), shall maintain at the Administrative Agent’s Office a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts
and stated interest of the Loans and Letter of Credit Obligations (specifying the Reimbursement Obligations), Letter of Credit Borrowings
and other amounts due under Section 2.04 owing to each Lender pursuant to the terms hereof from time to time (the “Register”). The entries
in the Register shall be conclusive absent manifest error, and the Borrower, the Agents and the Lenders shall treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower or any Lender (but only, in the case of a Lender at the
Administrative Agent’s Office and with respect to any entry relating to such Lender’s Commitments, Loans, Letter of Credit Obligations and
other Obligations), at any reasonable time and from time to time upon reasonable prior notice. This Section 11.07(c) and Section 2.13 shall
be construed so that all Loans are at all times maintained in “registered form” within the meaning of Sections 163(f), 871(h)(2) and 881(c)(2)
of the Code and any related United States Treasury regulations (or any other relevant or successor provisions of the Code or of such United
States Treasury regulations).
(d)
Participations. Any Lender may at any time, without the consent of, or notice to, the Borrower, the Administrative
Agent, the Issuing Banks, the Swing Line Lender or any other Person sell participations (a “Participation”) to any Person (other than to (1) a
natural person, a Disqualified Lender, (2) the Borrower or any of the Borrower’s Affiliates or Subsidiaries, (3) a Defaulting Lender or (4)
any Person described in the proviso to the definition of “Eligible Assignee”) (each, a “Participant”) in all or a portion of such Lender’s
rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans, and other Obligations
(including such Lender’s participations in Letters of Credit, Swing Line Loans and/or Protective Advances) owing to it); provided that (i)
such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties
hereto for the performance of such obligations and (iii) the Borrower, the Agents and the other Lenders shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument
pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and
the other Loan Documents and to approve any amendment, modification or waiver of any provision of this Agreement or any other Loan
Document; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to
any amendment, waiver or other modification described in Section 11.01(b)(i), Section 11.01(b)(ii), Section 11.01(b)(iv), Section 11.01(b)(v)
or Section 11.01(b)(vi) that directly and adversely affects such Participant. Subject to subsection (e) of this Section 11.07, the Borrower
agrees that each Participant shall be entitled to the benefits of Sections 3.01 (subject to the requirements of Section 3.01(b), (c), (d) and (e), as
applicable (it being understood that the documentation required under such Sections shall be delivered to the participating Lender)), 3.04 and
3.05 (through the applicable Lender) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to
subsection (b) of this Section 11.07. To the extent permitted by applicable Law, each Participant also shall be entitled to the benefits of
Section 11.09 as though it were a Lender; provided that such Participant agrees to be subject to Section 2.12 as though it were a Lender.
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To the extent that any participation is purported to be made to a Disqualified Lender, such transaction shall be subject to the applicable
provisions of Section 11.27.
(e)
Limitations upon Participant Rights. A Participant shall not be entitled to receive any greater payment under Section
3.01, 3.04 or 3.05 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant,
unless the sale of the participation to such Participant is made with the Borrower’s prior written consent, such consent not to be unreasonably
withheld or delayed, or such entitlement to a greater payment results from a change in law that occurs after the Participant acquired the
participation. Each Lender that sells a participation or has a loan funded by an SPC shall (acting solely for this purpose as a non-fiduciary
agent of the Borrower) maintain a register complying with the requirements of Sections 163(f), 871(h) and 881(c)(2) of the Code and the
Treasury regulations (or any other relevant or successor provisions of the Code or of such United States Treasury regulations) issued
thereunder relating to the exemption from withholding for portfolio interest on which is entered the name and address of each Participant or
SPC and the principal amounts (and stated interest) of each Participant’s or SPC’s interest in the Loans or other obligations under this
Agreement (the “Participant Register”). A Lender shall not be obligated to disclose the Participant Register to any Person except to the
extent such disclosure is necessary to establish that any Loan or other obligation is in registered form under Section 5f.103-1(c) or proposed
Section 1.163-5(b) of the United States Treasury regulations (or any amended or successor version). The entries in the Participant Register
shall be conclusive absent manifest error, and such Lender shall treat each person whose name is recorded in the Participant Register as the
owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.
(f)
Liens on Loans. Any Lender may, at any time without the consent of the Borrower or the Administrative Agent, pledge
or assign a security interest in all or any portion of its rights under this Agreement (including under its Notes, if any) to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank or any other central bank; provided that no
such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.
(g)
Special Purpose Funding Vehicles. Notwithstanding anything to the contrary contained herein, any Lender (a
“Granting Lender”) may grant to a special purpose funding vehicle identified as such in writing from time to time by the Granting Lender
to the Administrative Agent and the Borrower (an “SPC”) the option to provide all or any part of any Loan that such Granting Lender would
otherwise be obligated to make pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to
fund any Loan, and (ii) if an SPC elects not 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 Loan pursuant to the terms hereof. Each party hereto hereby agrees that (A) neither the grant to any
SPC nor the exercise by any SPC of such option shall increase the costs or expenses or otherwise increase or change the obligations of the
Borrower under this Agreement (including its obligations under Sections 3.01, 3.04 and 3.05), (B) no SPC shall be liable for any indemnity
or similar payment obligation under this Agreement for which a Lender would be liable, and (C) the Granting Lender shall for all purposes,
including the approval of any amendment, waiver or other modification of any provision of any Loan Document, remain the lender of record
hereunder. The making of a Loan by an SPC hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if,
such Loan were made by such Granting Lender. In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall
survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding
commercial paper or other senior debt of any SPC, it will not institute against, or join any other Person in instituting against, such SPC any
bankruptcy, reorganization, arrangement, insolvency, receivership or liquidation proceeding under the laws of the United States or any State
thereof or any Debtor Relief Law or other applicable Law. Notwithstanding anything to the contrary contained herein, any SPC may (1) with
notice to, but without prior consent of the Borrower and the Administrative Agent and with
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the payment of a processing fee of $3,500 (which processing fee may be waived by the Administrative Agent in its sole discretion), assign all
or any portion of its right to receive payment with respect to any Loan to the Granting Lender and (2) disclose on a confidential basis any
non-public information relating to its funding of Loans to any rating agency, commercial paper dealer or provider of any surety or Guarantee
or credit or liquidity enhancement to such SPC.
(h)
(i)
(j)
[Reserved].
[Reserved].
[Reserved].
(k)
Resignation of Swing Line Lender. Notwithstanding anything to the contrary contained herein, the Swing Line Lender
may, upon thirty days’ notice to the Borrower and the Tranche 1 Revolving Lenders, resign as the Swing Line Lender; provided that on or
prior to the expiration of such 30-day period with respect to such resignation, the Swing Line Lender shall have identified a successor Swing
Line Lender reasonably acceptable to the Borrower willing to accept its appointment as successor Swing Line Lender hereunder. In the event
of any such resignation of the Swing Line Lender, the Borrower shall be entitled to appoint from among the Lenders willing to accept such
appointment a successor Swing Line Lender hereunder; provided that no failure by the Borrower to appoint any such successor shall affect
the resignation of the Swing Line Lender except as expressly provided above. If the Swing Line Lender resigns as Swing Line Lender, it
shall retain all the rights of the Swing Line Lender provided for hereunder with respect to Swing Line Loans made by it and outstanding as of
the effective date of such resignation, including the right to require the Lenders to make Base Rate Loans or fund risk participations in
outstanding Swing Line Loans pursuant to Section 2.03(c). Upon the appointment by the Borrower of a successor Swing Line Lender
hereunder (which successor shall in all cases be a Lender other than a Defaulting Lender), (i) such successor shall succeed to and become
vested with all of the rights, powers, privileges and duties of the retiring Swing Line Lender and (ii) the retiring Swing Line Lender shall be
discharged from all of its duties and obligations hereunder or under the other Loan Documents.
(l)
[Reserved].
Section 11.08
Confidentiality
. Each of the Administrative Agent, the Collateral Agent, the Lead Arrangers, the Issuing Banks and the Lenders agrees to
maintain the confidentiality of the Information in accordance with its customary procedures (as set forth below), except that Information may
be disclosed,
(a)
to its Affiliates and branches and to its and its Affiliates’ and branches’ respective partners, directors, officers,
employees, agents, trustees, advisors and representatives (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information confidential and in no event shall such
disclosure be made to any Disqualified Lender pursuant to this clause (a) but, in the case of any Disqualified Lender, only to the extent that a
list of such Disqualified Lenders is available to all Lenders upon request);
(b)
to the extent requested by any regulatory authority purporting to have jurisdiction over it (including the Federal
Reserve Bank or any other central bank or any self-regulatory authority, such as the National Association of Insurance Commissioners);
(c)
to the extent required by applicable laws or regulations or by any subpoena or similar legal process, provided that the
Administrative Agent, the Collateral Agent, such Lead Arranger or such Lender or such Issuing Bank, as applicable, agrees that it will notify
the Borrower as soon as practicable in the
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event of any such disclosure by such Person (other than at the request of a regulatory authority) unless such notification is prohibited by law,
rule or regulation;
(d)
to any other party hereto (it being understood that in no event shall such disclosure be made to any Disqualified Lender
pursuant to this clause (d) but, in the case of a Disqualified Lender, only to the extent the list of such Disqualified Lenders is available to all
Lenders upon request);
(e)
in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or
proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder;
(f)
subject to an agreement containing provisions at least as restrictive as those of this Section 11.08 (it being understood
that in no event shall such disclosure be made to any Disqualified Lender pursuant to this clause (f) but, in the case of a Disqualified Lender,
only to the extent that a list of such Disqualified Lenders is available to all Lenders upon request), to (i) any bona fide assignee of or
Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement or any Eligible Assignee
invited to be an Additional Lender or (ii) any actual or prospective direct or indirect counterparty (or its advisors) to any swap or derivative
transaction relating to the Borrower or any of its Subsidiaries or any of their respective obligations;
(g)
(h)
with the prior written consent of the Borrower;
to any rating agency when required by it (it being understood that, prior to any such disclosure, such rating agency shall
undertake to preserve the confidentiality of any Information relating to the Loan Parties received by it from such Lender); or
(i)
to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section 11.08 or
(ii) becomes available to the Administrative Agent, the Collateral Agent, any Lead Arranger, any Lender, any Issuing Bank, or any of their
respective Affiliates or branches on a non-confidential basis from a source other than Holdings, the Borrower or any Subsidiary thereof, and
which source is not known by such Person to be subject to a confidentiality restriction in respect thereof in favor of the Borrower or any
Affiliate of the Borrower.
In addition, each of the Administrative Agent, the Collateral Agent, the Lead Arrangers, the Issuing Banks and the Lenders may disclose the
existence of this Agreement and the information about this Agreement to the CUSIP Service Bureau or any similar agency in connection with
the issuance and monitoring of CUSIP numbers with respect to the Loans, market data collectors, similar service providers to the lending
industry, and service providers to the Administrative Agent, the Collateral Agent, the Lead Arrangers, the Issuing Banks and the Lenders in
connection with the administration and management of this Agreement and the other Loan Documents.
For purposes of this Section 11.08, “Information” means all information received from or on behalf of any Loan Party or any
Subsidiary thereof relating to any Loan Party or any Subsidiary thereof or their respective businesses, other than any such information that is
available to the Administrative Agent, the Collateral Agent or any Lender on a non-confidential basis prior to disclosure by any Loan Party
or any Subsidiary thereof; it being understood that all information received from Holdings, the Borrower or any Subsidiary after the date
hereof shall be deemed confidential unless such information is clearly identified at the time of delivery as not being confidential. Any Person
required to maintain the confidentiality of Information as provided in this Section 11.08 shall be considered to have complied with its
obligation to do so in accordance with its customary procedures if such Person has exercised the same degree of care to
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maintain the confidentiality of such Information as such Person would accord to its own confidential information.
Each of the Administrative Agent, the Collateral Agent, the Lead Arrangers and the Lenders acknowledges that (A) the
Information may include Private-Side Information concerning Holdings, the Borrower or a Subsidiary, as the case may be, (B) it has
developed compliance procedures regarding the use of Private-Side Information and (C) it will handle such Private-Side Information in
accordance with applicable Law, including United States Federal and state securities Laws.
Notwithstanding anything to the contrary therein, nothing in any Loan Document shall require Holdings or any of its Subsidiaries
to provide information (i) that constitutes non-financial trade secrets or non-financial proprietary information, (ii) in respect of which
disclosure is prohibited by applicable Law, (iii) that is subject to attorney client or similar privilege or constitutes attorney work product or
(iv) the disclosure of which is restricted by binding agreements not entered into primarily for the purpose of qualifying for the exclusion in
this clause (iv).
Section 11.09
Set-off
. If an Event of Default shall have occurred and be continuing, each Lender and each Issuing Bank and each of their respective
Affiliates and branches is hereby authorized at any time and from time to time, after obtaining the prior written consent of the Administrative
Agent, without notice to any Loan Party or to any other Person (other than the Administrative Agent), any such notice being hereby expressly
waived, to the fullest extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand,
provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender or
such Issuing Bank or any such Affiliate or branch to or for the credit or the account of the Borrower or any other Loan Party against any and
all of the obligations of the Borrower or such Loan Party now or hereafter existing under this Agreement or any other Loan Document to
such Lender or such Issuing Bank, the Letters of Credit and participations therein, irrespective of whether or not (a) such Lender or such
Issuing Bank shall have made any demand under this Agreement or any other Loan Document and (b) the principal of or the interest on the
Loans or any amounts in respect of the Letters of Credit or any other amounts due hereunder shall have become due and payable pursuant to
Article II and although such obligations of the Borrower or such Loan Party may be contingent or unmatured or are owed to a branch or
office of such Lender or such Issuing Bank different from the branch or office holding such deposit or obligated on such indebtedness;
provided that in the event that any Defaulting Lender shall exercise any such right of setoff, (i) all amounts so set off shall be paid over
immediately to the Administrative Agent for further application in accordance with the provisions of Sections 2.15 and 2.19 and, pending
such payment, shall be segregated by such Defaulting Lender from its other funds and deemed held in trust for the benefit of the
Administrative Agent, the Issuing Banks, and the Lenders, and (ii) the Defaulting Lender shall provide promptly to the Administrative Agent
a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised such right of setoff. The
rights of each Lender and each Issuing Bank and their respective Affiliates under this Section 11.09 are in addition to other rights and
remedies (including other rights of set-off) that such Lender or such Issuing Bank or Affiliates or branches may have. Each Lender agrees to
notify the Borrower and the Administrative Agent promptly after any such set-off and application, provided that the failure to give such
notice shall not affect the validity of such set-off and application.
Section 11.10
Interest Rate Limitation
. Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan
Documents with respect to any of the Obligations, 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 interest
shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the
interest contracted for, charged, or received by an Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable
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Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary prepayments
and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest throughout the
contemplated term of the Obligations hereunder. If the rate of interest under this Agreement at any time exceeds the Maximum Rate, the
outstanding amount of the Loans made hereunder shall bear interest at the Maximum Rate until the total amount of interest due hereunder
equals the amount of interest which would have been due hereunder if the stated rates of interest set forth in this Agreement had at all times
been in effect. In addition, if when the Loans made hereunder are repaid in full the total interest due hereunder (taking into account the
increase provided for above) is less than the total amount of interest which would have been due hereunder if the stated rates of interest set
forth in this Agreement had at all times been in effect, then to the extent permitted by law, the Borrower shall pay to the Administrative
Agent an amount equal to the difference between the amount of interest paid and the amount of interest which would have been paid if the
Maximum Rate had at all times been in effect. Notwithstanding the foregoing, it is the intention of the Lenders and the Borrower to conform
strictly to any applicable usury laws.
Section 11.11
Counterparts; Integration; Effectiveness
. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and the other Loan Documents
constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Delivery of an executed counterpart of a signature page of this
Agreement by telecopy or other electronic imaging (including in.pdf or .tif format) means shall be effective as delivery of a manually
executed counterpart of this Agreement.
Section 11.12
Electronic Execution of Assignments and Certain Other Documents
. The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption, in or related to this
Agreement or any other document to be signed in connection with this Agreement and the transactions contemplated hereby or in any
amendment or other modification hereof (including without any limitation Assignment and Assumptions, amendments or other Committed
Loan Notices, Swing Line Loan Requests, waivers and consents) shall be deemed to include electronic signatures or the keeping of records in
electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a
paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Law, including the Federal
Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar
state laws based on the Uniform Electronic Transactions Act; provided that notwithstanding anything contained herein to the contrary, the
Administrative Agent is under no obligation to agree to accept electronic signatures in any form or in any format unless expressly agreed to
by the Administrative Agent pursuant to procedures approved by it.
Section 11.13
Survival
. All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant
hereto or thereto or in connection herewith or therewith shall survive the execution and delivery hereof and thereof. Such representations and
warranties have been or will be relied upon by the Administrative Agent, each Issuing Bank and each Lender, regardless of any investigation
made by the Administrative Agent, any Issuing Bank or any Lender or on their behalf and notwithstanding that the Administrative Agent,
any Issuing Bank or any Lender may have had notice or knowledge of any Default at the time of any Borrowing or issuance of a Letter of
Credit, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or unsatisfied or
any Letter of Credit remain outstanding. Notwithstanding anything herein or implied by law to the contrary, the agreements of each Loan
Party set forth in Sections 3.01, 3.04, 3.05, 11.04, 11.05, 11.06 and 11.09 and the agreements of the Lenders set forth in Sections 2.15, 10.03
and 10.07 shall survive the satisfaction of the Termination Conditions, and the termination hereof.
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Section 11.14
Severability
. If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable in any
jurisdiction, (a) the legality, validity and enforceability of the remaining provisions or obligations, or of such provision or obligation in any
other jurisdiction, of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall
endeavor in good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular
jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Without limiting the foregoing provisions of
this Section 11.14, if and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be
limited by Debtor Relief Laws, as determined in good faith by the Administrative Agent, any Issuing Bank or the Swing Line Lender, as
applicable, then such provisions shall be deemed to be in effect only to the extent not so limited.
Section 11.15
GOVERNING LAW
.
(a)
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER (INCLUDING
ANY CLAIMS SOUNDING IN CONTRACT LAW OR TORT LAW ARISING OUT OF THE SUBJECT MATTER HEREOF AND ANY
DETERMINATIONS WITH RESPECT TO POST-JUDGMENT INTEREST) AND EACH OTHER LOAN DOCUMENT SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK; provided that (i) the interpretation of the definition of “Material Adverse Effect” (as defined in the Acquisition Agreement) and
whether or not such a “Material Adverse Effect” (as defined in the Acquisition Agreement) has occurred for purposes of Section 4.01, (ii) the
determination of the accuracy of any Acquisition Agreement Representations and whether as a result of any inaccuracy of any Acquisition
Agreement Representation there has been a failure of a condition precedent set forth in Section 4.01 and (iii) the determination of whether the
Acquisition has been consummated in accordance with the terms of the Acquisition Agreement will, in each case, be governed by, and
construed and interpreted in accordance with, the laws of the State of Delaware as applied to the Acquisition Agreement, without giving
effect to any choice or conflict of law provision or rule that would cause the application of the laws of any other jurisdiction.
ITS APPOINTMENT
BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH PARTY HERETO (AND BY ITS
(b)
ACCEPTANCE OF
IRREVOCABLY AND
IN SUCH CAPACITY, EACH LEAD ARRANGER)
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION AND VENUE OF THE
COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK CITY IN THE BOROUGH OF MANHATTAN AND OF ANY
UNITED STATES FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN, AND ANY APPELLATE COURT FROM ANY
THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT (OTHER THAN WITH RESPECT TO ACTIONS BY ANY AGENT IN RESPECT OF RIGHTS UNDER ANY
COLLATERAL DOCUMENT OR ANY OTHER LOAN DOCUMENT GOVERNED BY A LAW OTHER THAN THE LAWS OF THE
STATE OF NEW YORK OR WITH RESPECT TO ANY COLLATERAL SUBJECT THERETO), OR FOR RECOGNITION OR
ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE PARTIES HERETO (AND BY ITS ACCEPTANCE OF ITS
APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER) IRREVOCABLY AND UNCONDITIONALLY AGREES THAT
ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW
YORK STATE COURT OR, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH
OF THE PARTIES HERETO (AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER)
AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE
ENFORCED IN OTHER
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JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. EACH PARTY HERETO
(AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER) AGREES THAT THE
AGENTS AND LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO
BRING PROCEEDINGS AGAINST ANY LOAN PARTY IN THE COURTS OF ANY OTHER JURISDICTION IN CONNECTION
WITH THE EXERCISE OF ANY RIGHTS UNDER THIS AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY OTHER LOAN
DOCUMENT OR THE ENFORCEMENT OF ANY JUDGMENT.
(c)
EACH LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH (b) OF THIS SECTION 11.15. EACH OF THE PARTIES HERETO
(AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER) HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO
THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
Section 11.16
WAIVER OF RIGHT TO TRIAL BY JURY
. EACH PARTY HERETO (AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD
ARRANGER) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). THE SCOPE OF THIS WAIVER IS
INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT
RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF
DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO (AND BY ITS
ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER) (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER
AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 11.16, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS
AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAVIER IN ITS RELATED FUTURE DEALINGS. EACH
PARTY HERETO (AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER)
FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT
IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING
(OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION 11.16 AND EXECUTED BY
EACH OF THE PARTIES HERETO AND THE LEAD ARRANGERS), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT
AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER LOAN DOCUMENTS OR
TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE LOANS MADE HEREUNDER. IN THE EVENT OF
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LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.
Section 11.17
Limitation of Liability
. The Loan Parties agree that no Indemnitee shall have any liability (whether in contract, tort or otherwise) to any Loan Party or
any of their respective Subsidiaries or any of their respective equity holders or creditors for or in connection with the transactions
contemplated hereby and in the other Loan Documents, except to the extent such liability is determined in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from such Indemnitee’s gross negligence or willful misconduct or bad faith or material
breach by such Indemnitee of its obligations under this Agreement. In no event, shall any party hereto, any Loan Party or any Indemnitee be
liable on any theory of liability for any special, indirect, consequential or punitive damages (including any loss of profits, business or
anticipated savings) (other than, in the case of the Borrower or Co-Borrower, in respect of any such damages incurred or paid by an
Indemnitee to a third party). Each party hereto (and by its acceptance of its appointment in such capacity, each Lead Arranger) hereby
waives, releases and agrees (each for itself and on behalf of its Subsidiaries) not to sue upon any such claim for any special, indirect,
consequential or punitive damages, whether or not accrued and whether or not known or suspected to exist in its favor.
Section 11.18
Use of Name, Logo, Etc.
Each Loan Party consents to the publication in the ordinary course by the Administrative Agent or any Lead Arranger of
customary advertising material relating to the financing transactions contemplated by this Agreement using such Loan Party’s name, product
photographs, logo or trademark; provided that any such trademarks or logos are used solely in a manner that is not intended to or reasonably
likely to harm or disparage the Borrower or any of its Subsidiaries or the reputation or goodwill of any of them. Such consent shall remain
effective until revoked by such Loan Party in writing to the Administrative Agent and such Lead Arranger, as applicable.
Section 11.19
USA PATRIOT Act Notice.
(a) Each Lender that is subject to the USA PATRIOT Act and the Administrative Agent (for itself and not on behalf of any Lender) hereby
notifies each Loan Party 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 and address of each Loan Party and other information that will allow
such Lender or the Administrative Agent, as applicable, to identify each Loan Party in accordance with the USA PATRIOT Act. Each Loan
Party shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other information that
the Administrative Agent or such Lender requests in order to comply with its ongoing obligations under applicable “know your customer”
and anti-money laundering rules and regulations, including the USA PATRIOT Act.
(b) Each Loan Party acknowledges that, pursuant to the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada), Part
II.1 of the Criminal Code (Canada), the Special Economic Measures Act (Canada), the United Nations Act (Canada) and other anti-terrorism
laws and “know your client” policies, regulations, laws or rules applicable in Canada, including any guidelines or orders thereunder
(collectively, “CAML”), the Lenders and Administrative Agent may be required to obtain, verify and record information regarding the Loan
Parties, their respective directors, authorized signing officers, direct or indirect shareholders or other Persons in control of such Loan Parties,
and the transactions contemplated hereby. Each Loan Party shall promptly provide all such information, including supporting documentation
and other evidence, as may be reasonably requested by any Lender or the Administrative Agent, or any prospective assignee or participant of
a Lender or the Administrative Agent, in order to comply with any applicable CAML, whether now or hereafter in existence. Each of the
Lenders agrees that the Administrative Agent has no obligation to ascertain the identity of the Loan Parties or any authorized signatories of
the Loan Parties on behalf of any Lender, or to confirm the
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completeness or accuracy of any information it obtains from the Loan Parties or any such authorized signatory in doing so.
Section 11.20
Service of Process
. EACH PARTY HERETO (AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD
ARRANGER) IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN SECTION
11.02. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY APPLICABLE LAW.
Section 11.21
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 Party acknowledges and agrees, and acknowledges its Affiliates’
understanding that: (a) (i) the transactions contemplated by the Loan Documents (including the exercise of rights and remedies hereunder and
thereunder) are arm’s-length commercial transactions between the Agents, the Lenders, the Issuing Banks, the Swing Line Lender and the
Lead Arrangers on the one hand, and the Loan Parties and their Affiliates, on the other hand, (ii) each of the Loan Parties has consulted its
own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (iii) each of the Loan Parties is capable of
evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan
Documents; (b) (i) the Agents, the Issuing Banks, the Swing Line Lender and the Lead Arrangers are and have been, and each Lender is and
has been, acting solely as a principal and, except as expressly agreed in writing by the relevant parties, have or has not been, are or is not, and
will not be acting as an advisor, agent or fiduciary for the Loan Parties, its stockholders or its Affiliates (irrespective of whether any Lender
has advised, is currently advising or will advise any Loan Party, its stockholders or its Affiliates on other matters), or any other Person and
(ii) none of the Agents, the Issuing Banks, the Swing Line Lender, the Lead Arrangers nor any Lender has any obligation to the Borrower,
Holdings or any of their respective Affiliates with respect to the transactions contemplated hereby except those obligations expressly set forth
herein and in the other Loan Documents; and (c) the Agents, the Issuing Banks, the Swing Line Lender, the Lead Arrangers, the Lenders and
their respective Affiliates and branches may be engaged in a broad range of transactions that involve economic interests that conflict with
those of the Loan Parties, their stockholders and/or their affiliates, and none of the Agents, the Issuing Banks, the Swing Line Lender, the
Lead Arrangers nor any Lender has any obligation to disclose any of such interests to the Borrower, Holdings or any of their respective
Affiliates. Each Loan Party agrees that nothing in the Loan Documents or otherwise will be deemed to create an advisory, fiduciary or
agency relationship or fiduciary or other implied duty between any Lender, on the one hand, and such Loan Party, its stockholders or its
affiliates, on the other. To the fullest extent permitted by law, each Loan Party hereby waives and releases any claims that it may have against
the Agents, the Issuing Banks, the Swing Line Lender, the Lead Arrangers or any Lender with respect to any breach or alleged breach of
agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.
Section 11.22
Binding Effect
. This Agreement shall become effective when it shall have been executed by the Borrower, Holdings and the Administrative
Agent and the Administrative Agent shall have been notified by each Lender and each Issuing Bank that each such Lender or each such
Issuing Bank has executed it and thereafter shall be binding upon and inure to the benefit of the Borrower, Holdings, each Agent, each
Lender and each Issuing Bank and their respective successors and assigns.
Section 11.23
Obligations Several; Independent Nature of Lender’s Rights
. The obligations of the Lenders hereunder are several and no Lender shall be responsible for the obligations or Commitments of
any other Lender hereunder. Nothing contained herein or in any other Loan Document, and no action taken by the Lenders pursuant hereto
or thereto, shall be deemed to constitute the Lenders as a partnership, an association, a joint venture or any other kind of entity. The amounts
payable at any time hereunder to
229
each Lender shall be a separate and independent debt, and each Lender shall be entitled to protect and enforce its rights arising out hereof and
it shall not be necessary for any other Lender to be joined as an additional party in any proceeding for such purpose.
Section 11.24
Headings
. Section headings herein are included herein for convenience of reference only and shall not constitute a part hereof for any other
purpose or be given any substantive effect.
Section 11.25
Acknowledgement and Consent to Bail-In of Affected Financial Institutions
.
Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among
any such parties, each party hereto acknowledges that any liability of any Lender that is an Affected Financial Institution arising under any
Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of the applicable
Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
(a)
the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such
liabilities arising hereunder which may be payable to it by any Lender that is an Affected 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 or cancellation of any such liability;
(ii)
a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such
Affected Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it,
and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability
under this Agreement or any other Loan Document; or
(iii)
the variation of the terms of such liability in connection with the exercise of the write-down and conversion
powers of the applicable Resolution Authority.
Section 11.26
Acknowledgment Regarding Any Supported QFCs
.
(a)
To the extent that the Loan Documents provide support, through a guarantee or otherwise (including the Guaranty), for
any Hedge Agreement or any other agreement or instrument that is a QFC (such support, “QFC Credit Support”, and each such QFC, a
“Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance
Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act
(together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC
Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated
to be governed by the laws of the State of New York and/or of the United States or any other state of the United States).
(b)
In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a
proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and
any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such
Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective
under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support
230
(and any such interest, obligation and rights in property) were governed by the laws of the United States or a state of the United States. In the
event a Covered Party or a BHC Act Affiliate of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime,
Default Rights under the Loan Documents that might otherwise apply to such Supported QFC or any QFC Credit Support that may be
exercised against such Covered Party are permitted to be exercised to no greater extent than such Default Rights could be exercised under the
U.S. Special Resolution Regime if the Supported QFC and the Loan Documents were governed by the laws of the United States or a state of
the United States. Without limitation of the foregoing, it is understood and agreed that rights and remedies of the parties with respect to a
Defaulting Lender shall in no event affect the rights of any Covered Party with respect to a Supported QFC or any QFC Credit Support.
Section 11.27
Disqualified Lenders
.
(a)
Replacement of Disqualified Lenders.
(i)
To the extent that any assignment or participation is made or purported to be made to a Disqualified Lender
(notwithstanding the other restrictions in this Agreement with respect to Disqualified Lenders), without limiting any other
provision of the Loan Documents,
(A)
upon the request of the Borrower, such Disqualified Lender shall be required immediately (and in
any event within five Business Days) to assign all or any portion of the Loans and Commitments then owned by such
Disqualified Lender (or held as a participation) to another Lender (other than a Defaulting Lender or another
Disqualified Lender), Eligible Assignee or the Borrower, and
(B)
the Borrower shall have the right to prepay all or any portion of the Loans and Commitments then
owned by such Disqualified Lender (or held as a participation), and if applicable, terminate the Commitments of such
Disqualified Lender, in whole or in part.
(ii)
Any such assignment or prepayment shall be made in exchange for an amount equal to the lesser of (A) the
face principal amount of the Loans so assigned and (B) the amount that such Disqualified Lender paid to acquire such
Commitments and/or Loans (it being understood that if the effective date of any such assignment is not an interest payment date,
such assignee shall be entitled to receive on the next succeeding interest payment date interest on the principal amount of the
Loans so assigned that has accrued and is unpaid from the interest payment date last preceding such effective date (except as may
be otherwise agreed between such assignee and the Borrower)).
(iii)
The Borrower shall be entitled to seek specific performance in any applicable court of law or equity to
enforce this Section 10.27. In addition, in connection with any such assignment, (A) if such Disqualified Lender does not execute
and deliver to the Administrative Agent a duly completed Assignment and Assumption and/or any other documentation necessary
or appropriate (in the good faith determination of the Administrative Agent or the Borrower, which determination shall be
conclusive) to reflect such replacement by the later of (1) the date on which the replacement Lender executes and delivers such
Assignment and Assumption and/or such other documentation and (2) the date as of which such Disqualified Lender shall be paid
by the assignee Lender (or, at its option, the Borrower) the amount required pursuant to this section, then such Disqualified Lender
shall be deemed to have executed and delivered such Assignment and Assumption and/or such other documentation as of such
date and the Borrower shall be entitled (but not obligated) to execute and deliver such Assignment and Assumption and/or such
other documentation on behalf
231
of such Disqualified Lender, and the Administrative Agent shall record such assignment in the Register, (B) each Lender (whether
or not then a party hereto) agrees to disclose to the Borrower the amount that the applicable Disqualified Lender paid to acquire
Commitments and/or Loans from such Lender and (C) each Lender that is a Disqualified Lender agrees to disclose to the
Borrower the amount it paid to acquire the Commitments and/or Loans held by it.
(b)
Amendments, Consents and Waivers under the Loan Documents. No Disqualified Lender shall have the right to
approve or disapprove any amendment, waiver or consent pursuant to Section 11.01 or under any Loan Document. In connection with any
determination as to whether the requisite Lenders (including whether the Required Lenders or Required Facility Lenders) have provided any
amendment, waiver or consent pursuant to Section 11.01 or under any other Loan Document:
(i)
Disqualified Lenders shall not be considered, and
(ii)
Disqualified Lenders shall be deemed to have consented to any such amendment, waiver or consent with
respect to its interest as a Lender in the same proportion as the allocation of voting with respect to such matter by Lenders who are
not Disqualified Lenders;
provided that (A) the Commitment of any Disqualified Lender may not be increased or extended without the consent of such Disqualified
Lender and (B) any waiver, amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects
any Disqualified Lender more adversely than other affected Lenders shall require the consent of such Disqualified Lender.
(c)
Limitation on Rights and Privileges of Disqualified Lenders. Except as otherwise provided in Section 11.27(b)(ii), no
Disqualified Lenders shall have the right to, and each such Person covenants and agrees not to, instruct the Administrative Agent, Collateral
Agent or any other Person in respect of the exercise of remedies with respect to the Loans or other Obligations. Further, no Disqualified
Lender that purports to be a Lender or Participant (notwithstanding any provisions of this Agreement that may have prohibited such
Disqualified Lender from becoming Lender or Participant) shall be entitled to any of the rights or privileges enjoyed by the other Lenders
with respect to voting (other than to the extent provided in Section 11.27(b)), and shall be deemed for all purposes to be, at most, a Defaulting
Lender until such time as such Disqualified Lender no longer owns any Loans or Commitments.
(d)
Survival. The provisions of this Section 11.27 shall apply and survive with respect to each Lender and Participant
notwithstanding that any such Person may have ceased to be a Lender or Participant hereunder or this Agreement may have been
terminated.
(e)
Administrative Agent.
(i)
Reliance. The Administrative Agent shall have no liability to the Borrower, any Lender or any other Person
in acting in good faith on any notice of Default or acceleration.
(ii)
Disqualified Lender Lists. The Administrative Agent shall have no responsibility or liability for monitoring
or enforcing the list of Disqualified Lenders or for any assignment or participation to a Disqualified Lender.
(iii)
Liability Limitations. The Administrative Agent shall not be responsible or have any liability for, or have
any duty to ascertain, inquire into, monitor or enforce, compliance with the provisions hereof relating to Disqualified
Lenders. Without limiting the generality of the foregoing, the Administrative Agent shall not (A) be obligated to ascertain,
monitor or inquire as to whether any Lender or Participant or prospective Lender or Participant is a Disqualified Lender
232
or (B) have any liability with respect to or arising out of any assignment or participation of Loans, or disclosure of confidential
information (including Information), to any Disqualified Lender. The list of Disqualified Lenders shall be specified on a schedule
that is held with the Administrative Agent, which list may be provided to any Lender or its proposed assignee upon request.
Section 11.28
Erroneous Payments
.
(a)
Each Recipient (and each Participant of any of the foregoing, by its acceptance of a Participation) hereby acknowledges
and agrees that if the Administrative Agent notifies such Recipient that the Administrative Agent has determined in its sole discretion that
any funds (or any portion thereof) received by such Recipient from the Administrative Agent (or any of its Affiliates) were erroneously
transmitted to, or otherwise erroneously or mistakenly received by, such Recipient (whether or not known to such Recipient) (whether as a
payment, prepayment or repayment of principal, interest, fees or otherwise; individually and collectively, a “Payment”) and demands the
return of such Payment, such Recipient shall promptly, but in no event later than one Business Day thereafter, return to the Administrative
Agent the amount of any such Payment as to which such a demand was made. A notice of the Administrative Agent to any Recipient under
this Section shall be conclusive, absent manifest error.
(b)
Without limitation of clause (a) above, each Recipient further acknowledges and agrees that if such Recipient receives
a Payment from the Administrative Agent (or any of its Affiliates) (x) that is in an amount, or on a date different from the amount and/or date
specified in a notice of payment sent by the Administrative Agent (or any of its Affiliates) with respect to such Payment (a “Payment
Notice”), (y) that was not preceded or accompanied by a Payment Notice, or (z) that such Recipient otherwise becomes aware was
transmitted, or received, in error or by mistake (in whole or in part), in each case, it understands and agrees at the time of receipt of such
Payment that an error has been made (and that it is deemed to have knowledge of such error) with respect to such Payment. Each Recipient
agrees that, in each such case, it shall promptly notify the Administrative Agent of such occurrence and, upon demand from the
Administrative Agent, it shall promptly, but in no event later than one Business Day thereafter, return to the Administrative Agent the amount
of any such Payment (or portion thereof) as to which such a demand was made.
(c)
Any Payment required to be returned by a Recipient under this Section 11.28 shall be made in Same Day Funds in the
currency so received, together with interest thereon in respect of each day from and including the date such Payment (or portion thereof) was
received by such Recipient to the date such amount is repaid to the Administrative Agent at the greater of the Federal Funds Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in
effect. Each Recipient hereby agrees that it shall not assert and, to the fullest extent permitted by applicable law, hereby waives, any right to
retain such Payment, and any claim, counterclaim, defense or right of set-off or recoupment or similar right to any demand by the
Administrative Agent for the return of any Payment received, including without limitation any defense based on “discharge for value” or any
similar doctrine.
(d)
The Borrower and each other Loan Party hereby agrees that (x) in the event an erroneous Payment (or portion thereof)
is not recovered from any Lender that has received such Payment (or portion thereof) for any reason, the Administrative Agent shall be
subrogated to all the rights of such Lender with respect to such amount and (y) an erroneous Payment shall not pay, prepay, repay, discharge
or otherwise satisfy any Obligations owed by the Borrower or any other Loan Party except, in each case, to the extent such erroneous
Payment is, and with respect to the amount of such erroneous Payment that is, comprised of funds of the Borrower or any other Loan Party;
provided that this Section 11.28(d) shall not be interpreted to increase (or accelerate the due date for), or have the effect of increasing (or
accelerating the due date
233
for), the Obligations of the Borrower relative to the amount (and/or timing for payment) of the Obligations that would have been payable had
such erroneous Payment not been made by the Administrative Agent.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
234
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written
PEARL MERGER SUB INC., as Initial Borrower (which on
the Closing Date will consummate the Merger, with DOMTAR
CORPORATION surviving as the Borrower)
By:
Name:
Title:
DOMTAR CORPORATION
By:
Name:
Title:
DOMTAR INC.
By:
Name:
Title:
.
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
PEARL EXCELLENCE HOLDCO L.P., as Holdings
By:
__________________________________
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
BARCLAYS BANK PLC, as Administrative Agent, Collateral Agent,
Swing Line Lender, Issuing Bank and Lender
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
BANK OF MONTREAL, as Issuing Bank and Lender
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH, as Issuing Bank
and Lender
__________________________________
__________________________________
By:
Name:
Title:
By:
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Issuing Bank
and Lender
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
U.S. BANK NATIONAL ASSOCIATION, as Lender
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
SIEMENS FINANCIAL SERVICES, INC., as Lender
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
BANK OF AMERICA, N.A., as Lender
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
ROYAL BANK OF CANADA, as Lender
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
COBANK, FCB, as Lender
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO ABL REVOLVING CREDIT AGREEMENT]
Exhibit 4.2
Execution Version
FIRST LIEN CREDIT AGREEMENT
dated as of November 30, 2021
by and among
PEARL MERGER SUB INC.,
as the Initial Borrower,
as
PEARL EXCELLENCE HOLDCO L.P.,
as Holdings
BARCLAYS BANK PLC,
as Administrative Agent and Collateral Agent,
and
THE LENDERS PARTY HERETO
________________
BARCLAYS BANK PLC,
BMO CAPITAL MARKETS CORP.,
CREDIT SUISSE LOAN FUNDING LLC,
and
WELLS FARGO SECURITIES, LLC
As Joint Lead Arrangers and Joint Bookrunners
TABLE OF CONTENTS
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS
Page
Defined Terms2
Other Interpretive Provisions78
Accounting and Finance Terms; Accounting Periods; Unrestricted Subsidiaries; Determination of Fair Market
Value78
Rounding79
References to Agreements, Laws, Etc.79
Times of Day79
Available Amount Transactions79
Pro Forma Calculations; Limited Condition Acquisitions; Basket and Ratio Compliance79
Currency Equivalents Generally83
Co-Borrowers83
ARTICLE II.
THE COMMITMENTS AND BORROWINGS
Term Loans84
Conversion/Continuation86
Availability87
Prepayments88
Termination or Reduction of Commitments93
Repayment of Loans94
Interest95
Fees96
Computation of Interest and Fees97
Evidence of Indebtedness97
Payments Generally97
Sharing of Payments, Etc.99
Incremental Borrowings99
Refinancing Amendments102
Extensions of Loans103
Defaulting Lenders104
Judgment Currency105
ARTICLE III.
TAXES, INCREASED COSTS PROTECTION AND ILLEGALITY
Taxes106
Illegality110
Inability to Determine Rates111
Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurocurrency Rate Loans112
Section 1.01
Section 1.02
Section 1.03
Section 1.04
Section 1.05
Section 1.06
Section 1.07
Section 1.08
Section 1.09
Section 1.10
Section 2.01
Section 2.02
Section 2.03
Section 2.04
Section 2.05
Section 2.06
Section 2.07
Section 2.08
Section 2.09
Section 2.10
Section 2.11
Section 2.12
Section 2.13
Section 2.14
Section 2.15
Section 2.16
Section 2.17
Section 3.01
Section 3.02
Section 3.03
Section 3.04
Section 3.05
Section 3.06
Section 3.07
Section 3.08
Funding Losses113
Matters Applicable to All Requests for Compensation114
Replacement of Lenders Under Certain Circumstances114
Survival115
ARTICLE IV.
CONDITIONS PRECEDENT TO BORROWINGS
Section 4.01
Section 4.02
Conditions to Initial Borrowing116
Conditions to All Borrowings of Delayed Draw Term Loans119
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
Section 5.01
Section 5.02
Section 5.03
Section 5.04
Section 5.05
Section 5.06
Section 5.07
Section 5.08
Section 5.09
Section 5.10
Section 5.11
Section 5.12
Section 5.13
Section 5.14
Section 5.15
Section 5.16
Section 5.17
Section 5.18
Section 5.19
Section 6.01
Section 6.02
Section 6.03
Section 6.04
Section 6.05
Section 6.06
Section 6.07
Section 6.08
Section 6.09
Section 6.10
Section 6.11
Section 6.12
Section 6.13
Existence, Qualification and Power; Compliance with Laws119
Authorization; No Contravention120
Governmental Authorization120
Binding Effect121
Financial Statements; No Material Adverse Effect121
Litigation121
Labor Matters121
Ownership of Property; Liens; Insurance121
Environmental Matters122
Taxes122
ERISA Compliance122
Subsidiaries123
Margin Regulations; Investment Company Act123
Disclosure123
Intellectual Property; Licenses, Etc.123
Solvency123
USA PATRIOT Act, FCPA and OFAC123
Collateral Documents124
Use of Proceeds124
ARTICLE VI.
AFFIRMATIVE COVENANTS
Financial Statements124
Certificates; Other Information126
Notices128
Payment of Certain Taxes128
Preservation of Existence, Etc.128
Maintenance of Properties128
Maintenance of Insurance128
Compliance with Laws129
Books and Records129
Inspection Rights130
Covenant to Guarantee Obligations and Give Security130
Further Assurances132
Designation of Subsidiaries133
Section 6.14
Section 6.15
Section 6.16
Section 6.17
Section 6.18
Section 7.01
Section 7.02
Section 7.03
Section 7.04
Section 7.05
Section 7.06
Section 7.07
Section 7.08
Section 7.09
Section 7.10
Section 7.11
Maintenance of Ratings134
Post-Closing Matters134
Use of Proceeds134
Change in Nature of Business134
Company Specified Representations134
ARTICLE VII.
NEGATIVE COVENANTS
Liens135
Investments140
Indebtedness143
Fundamental Changes147
Dispositions149
Restricted Payments152
Transactions with Affiliates156
Negative Pledge158
Junior Debt Prepayments; Amendments to Junior Financing Documents160
Passive Holding Company161
Changes in Fiscal Year163
ARTICLE VIII.
EVENTS OF DEFAULT AND REMEDIES
Section 8.01
Section 8.02
Section 8.03
Events of Default163
Remedies upon Event of Default165
Application of Funds166
Section 9.01
Section 9.02
Section 9.03
Section 9.04
Section 9.05
Section 9.06
Section 9.07
Section 9.08
Section 9.09
Section 9.10
Section 9.11
Section 9.12
Section 9.13
Section 9.14
Section 9.15
Section 9.16
ARTICLE IX.
ADMINISTRATIVE AGENT AND OTHER AGENTS
Appointment and Authority of the Administrative Agent167
Rights as a Lender168
Exculpatory Provisions168
Reliance by the Agents170
Delegation of Duties170
Non-Reliance on Agents and Other Lenders; Disclosure of Information by Agents171
Indemnification of Agents172
No Other Duties; Other Agents, Lead Arranger, Managers, Etc.172
Resignation of Administrative Agent or Collateral Agent173
Administrative Agent May File Proofs of Claim; Credit Bidding173
Collateral and Guaranty Matters175
Appointment of Supplemental Administrative Agents178
Intercreditor Agreements179
Cash Management Agreements and Secured Hedge Agreements180
Withholding Taxes180
Certain ERISA Matters180
ARTICLE X.
MISCELLANEOUS
Section 10.01
Section 10.02
Section 10.03
Section 10.04
Section 10.05
Section 10.06
Section 10.07
Section 10.08
Section 10.09
Section 10.10
Section 10.11
Section 10.12
Section 10.13
Section 10.14
Section 10.15
Section 10.16
Section 10.17
Section 10.18
Section 10.19
Section 10.20
Section 10.21
Section 10.22
Section 10.23
Section 10.24
Section 10.25
Section 10.26
Section 10.27
Section 10.28
Amendments, Waivers, Etc.181
Notices and Other Communications; Facsimile Copies186
No Waiver; Cumulative Remedies188
Attorney Costs and Expenses188
Indemnification by the Borrower189
Marshaling; Payments Set Aside191
Successors and Assigns191
Confidentiality196
Set-off198
Interest Rate Limitation198
Counterparts; Integration; Effectiveness199
Electronic Execution of Assignments and Certain Other Documents199
Survival199
Severability200
GOVERNING LAW200
WAIVER OF RIGHT TO TRIAL BY JURY201
Limitation of Liability202
Use of Name, Logo, Etc.202
USA PATRIOT Act Notice202
Service of Process202
No Advisory or Fiduciary Responsibility202
Binding Effect203
Obligations Several; Independent Nature of Lender’s Rights203
Headings203
Acknowledgement and Consent to Bail-In of Affected Financial Institutions203
Acknowledgment Regarding Any Supported QFCs204
Disqualified Lenders and Net Short Positions204
Erroneous Payments206
SCHEDULES
2.01
5.06
5.07
5.11(a)
5.11(b)
5.12
6.15
10.02
EXHIBITS
Form of
A-1
A-2
B-1
C
D
E
F
G
H
I
J
K
L
Commitments
Litigation
Labor Matters
ERISA Compliance
ERISA Compliance
Subsidiaries
Post-Closing Matters
Administrative Agent’s Office, Certain Addresses for Notices
Committed Loan Notice
Conversion/Continuation Notice
Term Loan Note
Compliance Certificate
Assignment and Assumption
Guaranty
Security Agreement
Non-Bank Certificate
Global Intercompany Note
Solvency Certificate
Prepayment Notice
Junior Lien Intercreditor Agreement
Auction Procedures
FIRST LIEN CREDIT AGREEMENT
This FIRST LIEN CREDIT AGREEMENT is entered into as of November 30, 2021, by and among Pearl Merger Sub Inc., a
Delaware corporation (“Merger Sub” and the “Initial Borrower”), PEARL EXCELLENCE HOLDCO L.P., a Delaware limited partnership
(“Holdings”), BARCLAYS BANK PLC, as administrative agent under the Loan Documents (in such capacity, including any successor
thereto, the “Administrative Agent”), BARCLAYS BANK PLC, as collateral agent under the Loan Documents (in such capacity, including
any successor thereto, the “Collateral Agent”), BARCLAYS BANK PLC (“Barclays”), BMO CAPITAL MARKETS CORP. (“BMO”),
CREDIT SUISSE LOAN FUNDING LLC (“CS”) and WELLS FARGO SECURITIES, LLC (“WF”), as joint lead arrangers and joint
bookrunners (the “Lead Arrangers”), and each lender from time to time party hereto (collectively, the “Lenders” and, individually, a
“Lender”). Capitalized terms used herein are defined as set forth in Section 1.01.
PRELIMINARY STATEMENTS
Pursuant to the Acquisition Agreement (as this and other capitalized terms used in these preliminary statements are defined in
Section 1.01 below), Merger Sub will merge with and into (the “Merger”) Domtar Corporation, a Delaware corporation (the “Company”
and together with its subsidiaries, the “Acquired Business”), with the Company surviving as successor Borrower (the “Acquisition”).
The Borrower has requested that substantially simultaneously with the consummation of the Acquisition and upon satisfaction (or
waiver) of the conditions precedent set forth in Article IV, the Lenders extend credit to the Borrower in the form of (i) Initial Term Loans in
an aggregate principal amount of $525,000,000 and (ii) Delayed Draw Term Loans in an aggregate principal amount of up to $250,000,000,
in each case, pursuant to the terms of this Agreement.
On the Closing Date, the Initial Borrower intends to enter into the ABL Credit Agreement pursuant to which it will obtain
commitments in an aggregate principal amount of $400,000,000.
On October 18, 2021, the Initial Borrower, as “issuer”, entered into the Senior Secured Notes Indenture pursuant to which the
Initial Borrower issued the Senior Secured Notes in an initial aggregate principal amount of $775,000,000.
On or prior to the Closing Date, Jackson Wijaya, Company Persons and other equity investors will, directly or indirectly make the
Equity Contribution in accordance with and subject to the terms of the Acquisition Agreement.
On the Closing Date, the Initial Borrower will repay (or cause to be repaid) all outstanding Indebtedness (the “Existing
Indebtedness”) under, terminate any commitments under, and cause to be released any contractual Liens securing obligations under the
Existing Credit Documents (such repayment, repurchase termination and release, collectively, the “Closing Date Refinancing”).
The proceeds of the Initial Term Loans, together with the proceeds of the Senior Secured Notes, borrowings under the ABL Credit
Agreement permitted thereunder on the Closing Date, the Equity Contribution and cash on hand at the Borrower and its Subsidiaries will be
used to finance the Transactions, for working capital purposes and to finance transactions not prohibited by this Agreement.
The applicable Lenders have indicated their willingness to make Loans on the terms and subject to the conditions set forth herein.
US-DOCS\125166839.14
In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:
ARTICLE I.
DEFINITIONS AND ACCOUNTING TERMS
Section 1.01
Defined Terms
. As used in this Agreement, the following terms have the meanings set forth below:
“ABL Credit Agreement” means that certain credit agreement, dated as of the Closing Date, by and among the Borrower, the
lenders party thereto, Barclays Bank PLC, as administrative agent, Barclays Bank PLC, as collateral agent, and the other parties thereto, as
the same may be amended, restated, modified, supplemented, extended, renewed, refunded, replaced or refinanced from time to time in one
or more agreements (in each case with the same or new lenders, institutional investors or agents), including any agreement extending the
maturity thereof or otherwise restructuring all or any portion of the Indebtedness thereunder or increasing the amount loaned or issued
thereunder or altering the maturity thereof.
“ABL Credit Facility” means the senior secured asset-based revolving loan facility and any term loan facilities made pursuant to
the ABL Credit Agreement.
“ABL Loan Documents” means the ABL Credit Agreement and the other “Loan Documents” as defined in the ABL Credit
Agreement, as each such document may be amended, restated, supplemented and/or otherwise modified.
“ABL Obligations” means the “Obligations” as defined in the ABL Credit Agreement.
“ABL Priority Collateral” means the “ABL Collateral” as defined in the Closing Date ABL Intercreditor Agreement.
“Acquired Business” has the meaning specified in the preliminary statements to this Agreement.
“Acquisition Agreement” means the Agreement and Plan of Merger, dated as of May 10, 2021, among Merger Sub, Paper
Excellence B.V., the Company, and the other parties thereto, as amended, restated, modified or supplemented from time to time in accordance
with the terms of the Commitment Letter.
“Acquisition Agreement Representations” means such of the representations and warranties made by the Acquired Business
with respect to the Acquired Business in the Acquisition Agreement to the extent a breach of such representations and warranties is material
and adverse to the interests of the Lenders (in their capacities as such).
“Acquisition Transaction” means the purchase or other acquisition (in one transaction or a series of transactions, including by
merger, amalgamation or otherwise) by the Borrower or any Restricted Subsidiary of all or substantially all the property, assets or business of
another Person, or assets constituting a business unit, line of business or division of, any Person, or of a majority of the outstanding Equity
Interests of any Person (including any Investment which serves to increase the Borrower’s or any Restricted Subsidiary’s respective equity
ownership in any Joint Venture or other Person to an amount in excess (or further in excess) of the majority of the outstanding Equity
Interests of such Joint Venture or other Person).
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“Additional Lender” means, at any time, any bank, other financial institution or institutional investor that, in any case, is not an
existing Lender and that agrees to provide any portion of any,
(a)
Incremental Loan in accordance with Section 2.13; or
(b)
Section 2.14;
Credit Agreement Refinancing Indebtedness pursuant to a Refinancing Amendment in accordance with
provided that each Additional Lender (other than any Person that is a Lender, an Affiliate or branch of a Lender or an Approved Fund of a
Lender at such time) shall be subject to the approval of the Administrative Agent (such approval not to be unreasonably withheld,
conditioned or delayed), in each case to the extent any such consent would be required from the Administrative Agent under Section 10.07(b)
(iii)(B), for an assignment of Loans to such Additional Lender.
“Adjusted Eurocurrency Rate” means, with respect to any Borrowing of Eurocurrency Rate Loans for any Interest Period, an
interest rate per annum equal to, (x) with respect to Eurocurrency Rate Loans denominated in Dollars, the Eurocurrency Rate based on
clause (a) of the definition of “Eurocurrency Rate” for such Interest Period multiplied by the Statutory Reserve Rate, and (y) with respect
to Eurocurrency Rate Loans denominated in an Alternative Currency, the Eurocurrency Rate based on clause (c) of the definition of
“Eurocurrency Rate” for such Interest Period; provided that, notwithstanding the foregoing, the “Adjusted Eurocurrency Rate” shall in no
event be less than 0.75% per annum with respect to (a) Initial Term Loans and Delayed Draw Term Loans made to the Borrower pursuant to
Section 2.01(a) and (b) all other Term Loans unless an alternate Eurocurrency Rate floor is specifically noted in the documentation with
respect to such other Term Loans or such documentation with respect to such other Term Loans specifically provides that there shall be no
Eurocurrency Rate floor. The Adjusted Eurocurrency Rate with respect to Eurocurrency Rate Loans denominated in Dollars will be adjusted
automatically as to all Borrowings of Eurocurrency Rate Loans then outstanding as of the effective date of any change in the Statutory
Reserve Rate.
“Administrative Agent” has the meaning specified in the introductory paragraph to this Agreement.
“Administrative Agent’s Office” means the Administrative Agent’s address and, as appropriate, account as set forth on
Schedule 10.02, or such other address or account as the Administrative Agent may from time to time notify the Borrower and the Lenders.
“Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.
“Affected Financial Institution” means (a) any EEA Financial Institution, or (b) any UK Financial Institution.
“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. “Controlled” has the meaning correlative thereto. For the avoidance of doubt, none of the Lead Arrangers, the
Agents, or their respective lending affiliates shall be deemed to be an Affiliate of the Loan Parties or any of the Restricted Subsidiaries.
“Agent Parties” has the meaning specified in Section 10.02(e).
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“Agent-Related Persons” means the Agents, together with their respective Affiliates and branches, and the officers, directors,
shareholders, employees, agents, attorney-in-fact, partners, trustees, advisors and other representatives of such Persons and of such Persons’
Affiliates and branches.
“Agents” means, collectively, the Administrative Agent, the Collateral Agent, the Supplemental Administrative Agents (if any),
the Joint Bookrunners and the Lead Arrangers.
“Aggregate Commitments” means the Commitments of all the Lenders.
“Agreement” means this First Lien Credit Agreement, as amended, restated, amended and restated, modified or supplemented
from time to time in accordance with the terms hereof.
“Agreement Currency” has the meaning specified in Section 2.17(b).
“AHYDO Catch Up Payment” has the meaning specified in Section 7.09(a)(viii).
“All-In Yield” means, as to any Indebtedness or Loans of any Class, the yield thereof, whether in the form of interest rate, margin,
OID, upfront fees, or an interest rate floor (such as a Eurocurrency Rate floor or Base Rate floor) as of such date; provided that when
determining All-In Yield:
(a)
if such Indebtedness (or Loans of any Class) is, by its terms, capable of being priced with reference to three
month ICE LIBOR for Dollar denominated loans, then All-In Yield shall be measured with reference to such ICE LIBOR rate, and
(ii) if such Indebtedness (or Loans of any Class) is not, by its terms, capable of being priced with reference to such ICE LIBOR
rate, including if such Indebtedness (or Loans of any Class) is priced with reference to a fixed rate of interest, then for purpose of
determining the All-In Yield, such Indebtedness (or Loans of any Class) shall be deemed to be swapped so that would effectively
be priced with reference to such ICE LIBOR rate on a customary matched maturity basis in a customary manner;
(b)
if such Indebtedness (or Loans of any Class) is priced with reference to a margin that is subject to a leverage-
based or other pricing grid, then for purpose of determining the All-In Yield the margin applicable to such Indebtedness (or Loans
of any Class) shall be determined with reference to such grid as of such date of measurement;
(c)
OID and similar upfront fees shall be equated to interest rate assuming a 4-year life to maturity (or, if less, the
stated life to maturity of the applicable Indebtedness as of such time);
(d)
All-In Yield shall not include any arrangement fees, structuring fees, underwriting fees, commitment fees,
amendment fees, ticking fees or any other fees similar to the foregoing (regardless of how such fees are computed or to whom
paid), fees not paid by a Loan Party, interest payable in kind or prepayment (or repayment) premiums applicable to such
Indebtedness.
When comparing the All-In Yield of any Indebtedness (or Loans of any Class) to the All-In Yield of the Initial Term Loans (or any
other applicable Indebtedness), as of any date,
(i)
if such Indebtedness (or Loans of any Class) includes an interest rate floor that is greater than the
corresponding interest rate floor applicable to the Initial Term Loans (or such other applicable Indebtedness), the amount of such
differential will increase the applicable margin with respect to such Indebtedness (or Loans of such Class) for purposes of
determining All-In Yield, but only to the extent an increase in the interest rate floor applicable to the Initial Term Loans (or such
other applicable Indebtedness) as of such date would cause an increase in the interest rate applicable
4
to the Initial Term Loans (or such other applicable Indebtedness) at such time, and in such case, for purposes of applying the
provisions of Section 2.13(h), the interest rate floor (but not the interest rate margin) applicable to the Initial Term Loans (or such
other applicable Indebtedness) shall be increased to the extent of such differential between interest rate floors; and
(ii)
if such Indebtedness (or Loans of any Class) includes an interest rate floor that is lower than the
corresponding interest rate floor applicable to the Initial Term Loans (or such other applicable Indebtedness), or does not include
an interest rate floor, and, as of the date such date of determination, the applicable interest rate floor with respect to the Initial
Term Loans (or such other applicable Indebtedness) is the basis for determining its margin, then the amount of such differential
(which shall be deemed to be 0.00% in the case of Indebtedness without an interest rate floor) shall reduce the applicable margin
with respect to such Indebtedness (or Loans of such Class) for purposes of determining All-In Yield.
“Alternative Currencies” means Euros, Canadian Dollars and, in the case of any Incremental Facility or Refinancing Loans, any
currency agreed to by the Administrative Agent, the Borrower and each Lender providing such Incremental Facility or Refinancing Loans;
provided that, in each case, each such other currency is a lawful currency that is readily available, freely transferable and not restricted and
able to be converted into Dollars in the London interbank deposit market.
“Annual Financial Statements” means the audited consolidated balance sheets of the Company as of December 31, 2020, and
the related consolidated statements of operations, changes in stockholders’ equity and cash flows for the Company for the fiscal year then
ended.
“Applicable Creditor” has the meaning specified in Section 2.17(b).
“Applicable Decimal Place” has the meaning specified in Section 1.04.
“Applicable Indebtedness” has the meaning specified in the definition of “Weighted Average Life to Maturity.”
“Applicable Rate” means:
(a)
with respect to Initial Term Loans and Delayed Draw Term Loans, a percentage per annum equal to (i) for
Eurocurrency Rate Loans, 5.50% and (ii) for Base Rate Loans, 4.50%; and
(b)
with respect any Term Loans (other than Initial Term Loans and Delayed Draw Term Loans) or other
Incremental Loans, as specified in the applicable Incremental Amendment, Extension Amendment or Refinancing Amendment.
“Appropriate Lender” means, at any time, with respect to Loans of any Class, the Lenders of such Class.
“Approved Fund” means, with respect to any Lender, any Fund that is administered, advised or managed by (a) such Lender,
(b) an Affiliate or branch of such Lender or (c) an entity or an Affiliate of an entity that administers, advises or manages such Lender.
“Assignment and Assumption” means an Assignment and Assumption substantially in the form of Exhibit D or any other form
approved by the Administrative Agent.
5
“Attorney Costs” means all reasonable and documented in reasonable detail fees, expenses, charges and disbursements of any law
firm or other external legal counsel.
“Attributable Indebtedness” means, on any date, in respect of any Capitalized Lease of any Person, the capitalized amount
thereof that would appear on a balance sheet of such Person prepared as of such date in accordance with GAAP.
“Auction Agent” means (a) the Administrative Agent or (b) any other financial institution or advisor employed by the Borrower
(whether or not an Affiliate or branch of the Administrative Agent) to act as an arranger in connection with any auction in accordance with
the auction procedures set forth on Exhibit L; provided that the Borrower shall not designate the Administrative Agent as the Auction Agent
without the written consent of the Administrative Agent (it being understood that the Administrative Agent shall be under no obligation to
agree to act as the Auction Agent); provided further neither the Borrower nor any of its Affiliates may act as the Auction Agent.
“Available Amount” means, as of any date of determination (such date, the “Reference Date”, with respect to the applicable
Available Amount Reference Period, a cumulative amount equal to the sum of, without duplication:
(a)
the greater of (i) 25.00% of Closing Date EBITDA and (ii) 25.00% of TTM Consolidated Adjusted EBITDA
as of the applicable date of determination; plus
(b)
an amount equal to 50% of cumulative Consolidated Net Income for such Available Amount Reference
Period; provided that when measuring such amount (i) Consolidated Net Income will be deemed not to be less than zero for any
fiscal quarter or year and (ii) Consolidated Net Income for any fiscal quarter or year will be deemed to be zero until the financial
statements required to be delivered pursuant to Section 6.01(a) or (b) for such fiscal quarter or year, and the related Compliance
Certificate required to be delivered pursuant to Section 6.02(a) for such fiscal quarter or year, have been received by the
Administrative Agent; plus
(c)
Permitted Equity Issuances, during the period from and including the Business Day immediately following
the Closing Date through and including the Reference Date and, to the extent Not Otherwise Applied; plus
(d)
to the extent not reflected as a return of capital with respect to such Investment for purposes of determining
the amount of such Investment pursuant to Section 7.02, the aggregate amount of all cash dividends and other cash distributions to
which the Borrower or any Restricted Subsidiary is entitled from any Minority Investments or Unrestricted Subsidiaries during the
period from and including the Business Day immediately following the Closing Date through and including the Reference Date;
plus
(e)
to the extent not reflected as a return of capital with respect to such Investment for purposes of determining
the amount of such Investment pursuant to Section 7.02, the Investments of the Borrower and its Restricted Subsidiaries in any
Unrestricted Subsidiary that has been re-designated as a Restricted Subsidiary or that has been merged, amalgamated or
consolidated with or into the Borrower or any of its Restricted Subsidiaries (up to the lesser of (i) the fair market value of such
Investments of the Borrower and its Restricted Subsidiaries in such Unrestricted Subsidiary at the time of such re-designation or
merger, amalgamation or consolidation and (ii) the fair market value of such Investments by the Borrower and its Restricted
Subsidiaries in such Unrestricted Subsidiary at the time they were made); plus
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(f)
to the extent not reflected as a return of capital with respect to such Investment for purposes of determining
the amount of such Investment or required to be applied to prepay Term Loans in accordance with Section 2.04(b)(ii), the
aggregate amount of all Net Cash Proceeds received by the Borrower or any Restricted Subsidiary in connection with the
Disposition of its ownership interest in any Minority Investment or Unrestricted Subsidiary during the period from and including
the Business Day immediately following the Closing Date through and including the Reference Date; plus
(g)
to the extent (i) not reflected as a return of capital with respect to such Investment for purposes of
determining the amount of such Investment pursuant to Section 7.02 and (ii) not in excess of the fair market value of such
Investment at the time it was made, the returns (including repayments of principal and payments of interest), profits, distributions
and similar amounts received in cash or Cash Equivalents by the Borrower and its Restricted Subsidiaries on Investments made by
the Borrower or any Restricted Subsidiary in reliance on the Available Amount; plus
(h)
(i) any amount of mandatory prepayments of Term Loans required to be prepaid pursuant to Section 2.04(b)
that have been declined by Lenders and retained by the Borrower in accordance with Section 2.04(b)(vi) and (ii) any amount of
mandatory prepayments of Pari Passu Lien Debt of the Borrower (and any Permitted Refinancing of the foregoing), to the extent
such amount was required to be applied to offer to repurchase or otherwise prepay such Indebtedness and the holders of such Pari
Passu Lien Debt declined such repurchase or prepayment; minus
(i)
the aggregate amount of any Investments made pursuant to Section 7.02(hh)(i), any Restricted Payments
made pursuant to Section 7.06(o)(i) and any Junior Debt Repayment made pursuant to Section 7.09(a)(x) during the period
commencing on the Closing Date and ending on the applicable date of determination (and, for purposes of this clause (j), without
taking account of the intended usage of the Available Amount on such applicable date of determination in the contemplated
transaction).
Notwithstanding anything to the contrary, to the extent any Excess Cash Flow is not applied to make a prepayment pursuant to
Section 2.04(b)(i) by virtue of the application of Section 2.04(b)(v), such Excess Cash Flow shall not under any circumstances increase the
Available Amount.
“Available Amount Reference Period” means, with respect to any applicable date of measurement of the Available Amount, the
period commencing on (i) with respect to the calculation of clause (b) of the definition of “Available Amount”, the first day of the first full
fiscal quarter in which the Closing Date occurs and ending on the last day of the most recent fiscal quarter for which internal financial
statements are available and (ii) with respect to the calculation of “Available Amount” (other than clause (b) of the definition thereof) the day
after the Closing Date through and including the date of measurement.
“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if the
then-current Benchmark is a term rate, any tenor for such Benchmark that is or may be used for determining the length of an Interest Period
or (y) otherwise, any payment period for interest calculated with reference to such Benchmark, as applicable, pursuant to this Agreement as
of such date.
“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable Resolution Authority in
respect of any liability of an Affected Financial Institution.
7
“Bail-In Legislation” means, (a) with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of
the European Parliament and of the Council of the European Union, the implementing law, rule, regulation or requirement for such EEA
Member Country from time to time which is described in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom,
Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the
United Kingdom relating to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other
than through liquidation, administration or other insolvency proceedings).
“Bankruptcy Code” shall mean Title 11 of the United States Code (11 U.S.C. §101, et seq.), as amended from time to time.
“Base Rate” means for any day a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 0.50%, (b) the
rate of interest last quoted by the Wall Street Journal as the “prime rate” in the United States, and (c) the Adjusted Eurocurrency Rate for
Loans denominated in Dollars on such day for an Interest Period of one month plus 1.00% (or, if such day is not a Business Day, the
immediately preceding Business Day); provided that, notwithstanding the foregoing, the “Base Rate” shall in no event be less than 1.75%
per annum. The “prime rate” is a rate set by the Administrative Agent based upon various factors including the Administrative Agent’s costs
and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be
priced at, above, or below such announced rate. Any change in such prime rate announced by the Administrative Agent shall take effect at
the opening of business on the day specified in the public announcement of such change.
“Base Rate Loan” means a Loan denominated in Dollars that bears interest based on the Base Rate.
“Benchmark” means, initially, USD LIBOR; provided that if a replacement of the Benchmark has occurred pursuant to Section
10.01(f) titled “Benchmark Replacement Setting”, then “Benchmark” means the applicable Benchmark Replacement to the extent that such
Benchmark Replacement has replaced such prior benchmark rate. Any reference to “Benchmark” shall include, as applicable, the published
component used in the calculation thereof.
“Benchmark Replacement” means, for any Available Tenor:
(1) For purposes of Section 10.01(f)(i)(A), the first alternative set forth below that can be determined by the Administrative Agent:
(a) the sum of: (i) Term SOFR and (ii) 0.11448% (11.448 basis points) for an Available Tenor of one-month’s duration,
0.26161% (26.161 basis points) for an Available Tenor of three-months’ duration, and 0.42826% (42.826 basis points) for an
Available Tenor of six-months’ duration, or
(b) the sum of: (i) Daily Simple SOFR and (ii) the spread adjustment selected or recommended by the Relevant
Governmental Body for the replacement of the tenor of USD LIBOR with a SOFR-based rate having approximately the same
length as the interest payment period specified in clause (a) of this definition; and
(2) For purposes of Section 10.01(f)(i)(B), the sum of (a) the alternate benchmark rate and (b) an adjustment (which may be a
positive or negative value or zero), in each case, that has been selected by the Administrative Agent and the Borrower as the replacement for
such Available Tenor of such Benchmark giving due consideration to any evolving or then-prevailing market convention, including any
applicable
8
recommendations made by the Relevant Governmental Body, for U.S. dollar-denominated syndicated credit facilities at such time;
provided that, if the Benchmark Replacement as determined pursuant to clause (1) or (2) above would be less than the Floor, the
Benchmark Replacement will be deemed to be the Floor for the purposes of this Agreement and the other Loan Documents.
“Benchmark Replacement Conforming Changes” means, with respect to any Benchmark Replacement, any technical,
administrative or operational changes (including changes to the definition of “ABR,” the definition of “Business Day,” the definition of
“Interest Period,” timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment,
conversion or continuation notices, the applicability and length of lookback periods, the applicability of breakage provisions, and other
technical, administrative or operational matters) that the Administrative Agent decides may be appropriate to reflect the adoption and
implementation of such Benchmark Replacement and to permit the administration thereof by the Administrative Agent in a manner
substantially consistent with market practice (or, if the Administrative Agent decides that adoption of any portion of such market practice is
not administratively feasible or if the Administrative Agent determines that no market practice for the administration of such Benchmark
Replacement exists, in such other manner of administration as the Administrative Agent decides is reasonably necessary in connection with
the administration of this Agreement and the other Loan Documents).
“Benchmark Transition Event” means, with respect to any then-current Benchmark other than USD LIBOR, the occurrence of a
public statement or publication of information by or on behalf of the administrator of the then-current Benchmark, the regulatory supervisor
for the administrator of such Benchmark, the Board of Governors of the Federal Reserve System, the Federal Reserve Bank of New York, an
insolvency official with jurisdiction over the administrator for such Benchmark, a resolution authority with jurisdiction over the administrator
for such Benchmark or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark,
announcing or stating that (a) such administrator has ceased or will cease on a specified date to provide all Available Tenors of such
Benchmark, permanently or indefinitely, provided that, at the time of such statement or publication, there is no successor administrator that
will continue to provide any Available Tenor of such Benchmark or (b) all Available Tenors of such Benchmark are or will no longer be
representative of the underlying market and economic reality that such Benchmark is intended to measure and that representativeness will not
be restored.
“Beneficial Ownership Certification” means a certification regarding beneficial ownership as required by the Beneficial
Ownership Regulation.
“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.
“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan”
as defined in and subject to Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or
otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan”.
“BHC Act Affiliate” of a party means an “affiliate” (as such term is defined under, and interpreted in accordance with, 12 U.S.C.
1841(k)) of such party.
“Board of Directors” means, as to any Person, the board of directors, board of managers or other governing body of such Person,
or if such Person is owned or managed by a single entity, the board of
9
directors, board of managers or other governing body of such entity, and the term “directors” means members of the Board of Directors.
“Borrower” means, (i) immediately prior to the consummation of the Merger, the Initial Borrower, (ii) immediately after the
consummation of the Merger, the Company, together with their successors and assigns permitted hereunder.
“Borrower Materials” has the meaning specified in Section 6.02.
“Borrowing” means a borrowing consisting of Loans of the same Class and Type made, converted or continued on the same date
and, in the case of Eurocurrency Rate Loans, having the same Interest Period.
“Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close
under the Laws of, or are in fact closed in, the jurisdiction where the Administrative Agent’s Office is located (which, as of the date of this
Agreement, is New York, New York) and (i) if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in
Dollars, any fundings, disbursements, settlements and payments in respect of any such Eurocurrency Rate Loan, or any other dealings to be
carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan, means any such day on which dealings in deposits in
Dollars are conducted by and between banks in the London interbank eurodollar market and (ii) if such day relates to any interest rate
settings as to a Eurocurrency Rate Loan denominated in Euros, any fundings, disbursements, settlements and payments in respect of any such
Eurocurrency Rate Loan, or any other dealings to be carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan,
means any such day that is also a TARGET Day.
“Canadian Dollars” means the lawful currency of Canada.
“Canadian Subsidiary” means any Subsidiary that is organized under the Laws of Canada or any province or territory thereof.
“Capital Expenditures” means, for any period, the aggregate of all expenditures (whether paid in cash or accrued as liabilities
and including in all events all amounts expended or capitalized under Capitalized Leases) by the Borrower and the Restricted Subsidiaries
during such period that, in conformity with GAAP, are or are required to be included as capital expenditures on the consolidated statement of
cash flows of the Borrower and the Restricted Subsidiaries.
“Capitalized Lease Obligation” means, at the time any determination thereof is to be made, the amount of the liability in respect
of a Capitalized Lease that would at such time be required to be capitalized and reflected as a liability on a balance sheet (excluding the
footnotes thereto) prepared in accordance with GAAP.
“Capitalized Leases” means all capital or financing leases that have been or are required to be, in accordance with GAAP as in
effect on the Closing Date (including the Borrower’s adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842)),
recorded as capital or financing leases; provided that (i) for all purposes hereunder the amount of obligations under any Capitalized Lease
shall be the amount thereof accounted for as a liability in accordance with GAAP as in effect on the Closing Date (including the Borrower’s
adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842)) and (ii) in no event shall an operating lease or a lease
that would have been an operating lease prior to the adoption of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842)) be
considered a Capitalized Lease.
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“Captive Insurance Subsidiary” means any Subsidiary of the Borrower that is subject to regulation as an insurance company (or
any Subsidiary thereof).
“Cash Collateral Account” means an account held at, and subject to the sole dominion and control of, the Collateral Agent.
“Cash Collateralize” means, in respect of an Obligation, to provide and pledge (as a first priority perfected security interest) cash
collateral in Dollars, at a location and pursuant to documentation in form and substance satisfactory to the Administrative Agent (and “Cash
Collateralization” has a corresponding meaning). “Cash Collateral” shall have a meaning correlative to the foregoing and shall include the
proceeds of such cash collateral and other credit support.
“Cash Equivalents” means any of the following types of Investments (including for the avoidance of doubt, cash), to the extent
owned by the Borrower or any Restricted Subsidiary:
(a)
(b)
Dollars, Canadian Dollars and each Alternative Currency;
local currencies held by the Borrower or any Restricted Subsidiary from time to time in the ordinary course
of business and not for speculation;
(c)
readily marketable direct obligations issued or directly and fully and unconditionally guaranteed or insured
by the United States government or any agency or instrumentality thereof the securities of which are unconditionally guaranteed
as a full faith and credit obligation of such government with maturities of 12 months or less from the date of acquisition;
(d)
certificates of deposit, time deposits and eurodollar time deposits with maturities of one year or less from the
date of acquisition, demand deposits, bankers’ acceptances with maturities not exceeding one year and overnight bank deposits, in
each case with any domestic or foreign commercial bank having capital and surplus of not less than $500,000,000 (or the foreign
currency equivalent thereof as of the date of such investment);
(e)
repurchase obligations for underlying securities of the types described in clauses ((c)) and ((d)) above or
clause (h) below entered into with any financial institution meeting the qualifications specified in clause ((d)) above;
(f)
commercial paper rated at least P-2 by Moody’s or at least A-2 by S&P (or, if at any time neither Moody’s
nor S&P shall be rating such obligations, an equivalent rating from another nationally recognized statistical rating agency) and in
each case maturing within 12 months after the date of creation thereof;
(g)
marketable short-term money market and similar highly liquid funds having a rating of at least P-2 or A-2
from Moody’s or S&P, respectively (or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent
rating from another nationally recognized statistical rating agency);
(h)
readily marketable direct obligations issued by any state, commonwealth or territory of the United States, or
any political subdivision or taxing authority thereof, in each case having an Investment Grade Rating from either Moody’s or S&P
(or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from another nationally
recognized statistical rating agency) with maturities of 12 months or less from the date of acquisition;
11
(i)
Investments with average maturities of 12 months or less from the date of acquisition in money market funds
rated AAA- (or the equivalent thereof) or better by S&P or Aaa3 (or the equivalent thereof) or better by Moody’s (or, if at any
time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from another nationally recognized statistical
rating agency);
(j)
through ((i)) above; and
investment funds investing substantially all of their assets in securities of the types described in clauses ((a))
(k)
solely with respect to any Captive Insurance Subsidiary, any investment that a Captive Insurance Subsidiary
is not prohibited to make in accordance with applicable law.
In the case of Investments by any Foreign Subsidiary that is a Restricted Subsidiary or Investments made in a jurisdiction outside the United
States of America, Cash Equivalents shall also include (i) investments of the type and maturity described in clauses ((a)) through ((k)) above
in foreign obligors, which Investments or obligors (or the parents of such obligors) have ratings described in such clauses or equivalent
ratings from comparable foreign rating agencies and (ii) other short-term investments in accordance with normal investment practices for
cash management in investments analogous to the foregoing investments in clauses ((a)) through ((k)) above and in this
paragraph. Notwithstanding the foregoing, Cash Equivalents shall include amounts denominated in currencies other than those set forth in
clause ((a)) or ((b)) above; provided that such amounts, except amounts used to pay obligations of the Borrower or any Restricted Subsidiary
denominated in any currency other than Dollars or an Alternative Currency in the ordinary course of business, are converted into Dollars or
an Alternative Currency as promptly as practicable and in any event within ten Business Days following the receipt of such amounts.
“Cash Management Bank” means (i) any Person that is a Lender or Agent or an Affiliate or branch of a Lender or Agent (a) on
the Closing Date (with respect to any Cash Management Services entered into prior to the Closing Date), (b) at the time it initially provides
any Cash Management Services to the Borrower or any Restricted Subsidiary, or (c) at the time that the Person to whom the Cash
Management Services are provided is merged or amalgamated with the Borrower or becomes or is merged or amalgamated with a Restricted
Subsidiary (with respect to any Cash Management Services entered into prior to the date of such merger or amalgamation or such Person
becoming a Restricted Subsidiary), in each case whether or not such Person subsequently ceases to be a Lender or Agent or an Affiliate or
branch of a Lender or Agent or (ii) any other Person reasonably acceptable to the Administrative Agent and designated by the Borrower to
the Administrative Agent in writing and so long as such Person (a) agrees to appoint the Administrative Agent as its agent under the
applicable Loan Documents and (b) agrees to be bound by the provisions of the applicable Loan Documents as a Cash Management Bank.
“Cash Management Obligations” means obligations owed by the Borrower or any Restricted Subsidiary to any Cash
Management Bank in respect of or in connection with any Cash Management Services and designated by the Cash Management Bank and
the Borrower in writing to the Administrative Agent as “Cash Management Obligations” (but only if such Cash Management Services have
not been designated as “Cash Management Obligations” under the ABL Credit Agreement).
“Cash Management Services” means any agreement or arrangement to provide cash management services, including treasury,
depository, overdraft, credit card processing, credit or debit card, purchase card, electronic funds transfer and other cash management
arrangements.
“Casualty Event” means any event that gives rise to the receipt by a Loan Party of any property or casualty insurance proceeds or
any condemnation or expropriation awards, in each case, in respect of
12
any equipment, fixed assets or real property (including any improvements thereon) to replace or repair such equipment, fixed assets or real
property.
“CFC” means a “controlled foreign corporation” within the meaning of Section 957(a) of the Code.
“Change in Law” means the occurrence, after the date of this Agreement, of any of the following:
(a)
the adoption or taking effect of any law, rule, regulation or treaty (excluding the taking effect after the date of
this Agreement of a law, rule, regulation or treaty adopted prior to the date of this Agreement);
(b)
any change in any law, rule, regulation or treaty or in the administration, interpretation or application thereof
by any Governmental Authority; or
(c)
Governmental Authority.
the making or issuance of any request, guideline or directive (whether or not having the force of law) by any
It is understood and agreed that (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act (Pub. L. 111-203, H.R. 4173), all Laws
relating thereto, all interpretations and applications thereof and any compliance by a Lender with any and all requests, rules, guidelines,
requirements and directives thereunder or issued in connection therewith or in implementation thereof or relating thereto and (ii) all requests,
rules, guidelines, requirements or directives issued by any United States or foreign regulatory authority in connection with the
implementation of the recommendations of the Bank for International Settlements or the Basel Committee on Banking Regulations and
Supervisory Practices (or any successor or similar authority) in each case pursuant to Basel III, shall, for the purposes of this Agreement, be
deemed to be adopted subsequent to the date hereof and a Change in Law regardless of the date enacted, adopted, issued, promulgated or
implemented.
“Change of Control” means the earliest to occur of:
(a)
either:
(i)
at any time prior to the consummation of a Qualifying IPO, the Permitted Holders ceasing to
beneficially own (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), in the aggregate, directly or indirectly,
a majority of the aggregate ordinary voting power represented by the issued and outstanding Equity Interests of
Holdings (or Successor Holdings, if applicable) or any Parent Entity; or
(ii)
any Person (other than a Permitted Holder) or Persons (other than one or more Permitted Holders)
constituting a “group” (as such term is used in Section 13(d) and Section 14(d) of the Exchange Act, but excluding any
employee benefit plan of such Person and its Subsidiaries, and any Person acting in its capacity as trustee, agent or
other fiduciary or administrator of any such plan), becoming the “beneficial owner” (as defined in Rules 13(d)-3 and
13(d)-5 under such Act), directly or indirectly, of Equity Interests representing more than forty percent (40%) of the
aggregate ordinary voting power represented by the then issued and outstanding Equity Interests of Holdings (or
Successor Holdings, if applicable) and the percentage of aggregate ordinary voting power so held is greater than the
percentage of the aggregate ordinary voting power represented by the Equity Interests of Holdings (or Successor
Holdings, if applicable) beneficially owned (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or
indirectly, in the aggregate by the Permitted Holders, unless the Permitted Holders have, at such time, the right or the
ability
13
by voting power, contract or otherwise to elect or designate for election 50% or more of the Board of Directors of either
(1) Holdings (or Successor Holdings, if applicable) or (2) a Parent Entity;
(b)
the Borrower ceasing to be a direct wholly owned Subsidiary of Holdings (or Successor Holdings, if
applicable); and
(c)
Agreement.
a Change of Control or similar event occurring under the Senior Secured Notes Indenture or the ABL Credit
“Class” when used in reference to,
(a)
any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Initial
Term Loans, Delayed Draw Term Loans, Incremental Term Loans, Refinancing Term Loans, or Extended Term Loans;
(b)
any Commitment, refers to whether such Commitment is (i) a Commitment in respect of Initial Term Loans
or Delayed Draw Term Loans, (ii) a Refinancing Term Commitment (and, in the case of a Refinancing Term Commitment, the
Class of Loans to which such commitment relates), or (iii) a Commitment in respect of a Class of Loans to be made pursuant to an
Incremental Amendment or an Extension Amendment; and
(c)
Loans or Commitments.
any Lender, refers to whether such Lender has a Loan or Commitment with respect to a particular Class of
Refinancing Term Commitments, Refinancing Term Loans, Incremental Term Loans and Extended Term Loans that have different terms and
conditions shall be construed to be in different Classes.
“Change of Control Offer” has the meaning assigned to such term in the Indenture governing the Existing Notes.
“Closing Date” means the first date on which all of the conditions precedent in Section 4.01 are satisfied or waived in accordance
with Section 10.01 and the Initial Term Loans are made to the Borrower pursuant to the first sentence of Section 2.01(a).
“Closing Date ABL Intercreditor Agreement” means the Intercreditor Agreement, dated as of the Closing Date, by and among
the Collateral Agent, each Debt Representative under the Senior Secured Notes Indenture and the ABL Credit Agreement, and each
additional representative from time to time party thereto, as acknowledged by the Loan Parties, as amended, restated, supplemented or
otherwise modified from time to time in accordance with the terms thereof.
“Closing Date EBITDA” means $415,000,000.
“Closing Date Equal Priority Intercreditor Agreement” means the Pari Passu Intercreditor Agreement, dated as of the Closing
Date, by and among the Collateral Agent, each Debt Representative under the Senior Secured Notes Indenture, and each additional
representative from time to time party thereto, as acknowledged by the Loan Parties, as amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms thereof.
“Closing Date First Lien Net Leverage Ratio” means 3.70 to 1.00.
14
“Closing Date Refinancing” has the meaning specified in the preliminary statements to this Agreement.
“Closing Date Secured Net Leverage Ratio” means 3.70 to 1.00.
“Closing Date Total Net Leverage Ratio” means 3.70 to 1.00.
“Closing Fee” has the meaning specified in Section 2.08(b).
“Co-Borrower” has the meaning specified in Section 1.10.
“Co-Borrower Effective Date” has the meaning specified in Section 1.10.
“Co-Investor” means any of (a) the assignees, if any, of the equity commitments of Jackson Wijaya who became holders of
Equity Interests in Holdings (or any of the direct or indirect parent companies of Holdings) on the Closing Date in connection with the
Acquisition and (b) the transferees, if any, that acquired, within 45 days of the Closing Date, any Equity Interests in Holdings (or any of the
direct or indirect parent companies of Holdings) held by Jackson Wijaya as of the Closing Date; provided, that Co-Investors under this clause
(b) (A) do not in the aggregate hold more than 49.9% of the ordinary voting power represented by the issued and outstanding Equity Interests
of Holdings (or any of the direct or indirect parent companies of Holdings) and (B) shall have been identified to the Administrative Agent in
writing prior to the Closing Date.
“Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time.
“Collateral” means all the “Collateral” as defined in any Collateral Document and all other property that is subject or purported
to be subject to any Lien in favor of the Collateral Agent for the benefit of the Secured Parties pursuant to any Collateral Document, but in
any event excluding all Excluded Assets.
“Collateral Agent” has the meaning specified in the introductory paragraph to this Agreement.
“Collateral Documents” means, collectively, the Security Agreement, the Mortgages (if any), the Intellectual Property Security
Agreements, the Security Agreement Supplements, security agreements, or other similar agreements delivered to the Agents and the Lenders
pursuant to Sections 4.01(a), 6.11, 6.12 or 6.15, and each of the other agreements, instruments or documents that creates or purports to create
a Lien in favor of the Collateral Agent for the benefit of the Secured Parties.
“Commitment Letter” means that certain Second Amended and Restated Commitment Letter, dated as of June 10, 2021, among
the Initial Borrower, Barclays Bank PLC, Bank of Montreal, BMO Capital Markets Corp., Credit Suisse AG, Cayman Islands Branch, Credit
Suisse Loan Funding LLC, Wells Fargo Bank, National Association and Wells Fargo Securities, LLC.
“Commitment Parties” has the meaning specified in the Commitment Letter.
“Commitments” means the Term Loan Commitments and the Delayed Draw Commitments.
“Committed Loan Notice” means a notice of a Borrowing pursuant to Article II, which, if in writing, shall be substantially in the
form of Exhibit A-1 or such other form as may be approved by the Administrative Agent (including any form on an electronic platform or
electronic transmission system as shall be approved by the Administrative Agent)
15
“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any
successor statute.
“Company” has the meaning specified in the preliminary statements.
“Company Person” means any future, current or former officer, director, manager, member, member of management, employee,
consultant or independent contractor of the Borrower, any Subsidiary, Holdings or any Parent Entity.
“Company Specified Representations” means those representations and warranties made by the Borrower, including with
respect to each of its Subsidiaries that is required to become a Guarantor upon the consummation of the Acquisition, in Sections 5.01(a) (with
respect to organizational existence only), 5.01(b)(ii), 5.02(a), 5.02(b)(i), 5.04, 5.13, 5.16, 5.17 (with respect the use of proceeds of the Term
Loans not in violation of the FCPA and OFAC) and 5.18.
“Compliance Certificate” means a certificate substantially in the form of Exhibit C.
“Connection Income Taxes” means Other Connection Taxes that are imposed on or measured by net income (however
denominated) or that are franchise Taxes or branch profits Taxes.
“Consolidated Adjusted EBITDA” means, with respect to any Person for any Test Period, the Consolidated Net Income of such
Person for such Test Period:
(a)
increased, without duplication, by the following items (solely to the extent deducted (and not excluded) in
calculating Consolidated Net Income, other than in respect of the proviso in clause (i) below and clauses (ii)(B), (xi), (xix) and
(xx) below) of such Person and its Restricted Subsidiaries for such Test Period determined on a consolidated basis in accordance
with GAAP:
(i)
interest expense, including (A) imputed interest on Capitalized Lease Obligations and Attributable
Indebtedness (which, in each case, will be deemed to accrue at the interest rate reasonably determined by a Responsible
Officer of the Borrower to be the rate of interest implicit in such Capitalized Lease Obligations or Attributable
Indebtedness), (B) commissions, discounts and other fees, charges and expenses owed with respect to letters of credit,
bankers’ acceptance financing, surety and performance bonds and receivables financings, (C) amortization and write-
offs of deferred financing fees, debt issuance costs, debt discounts, commissions, fees, premium and other expenses, as
well as expensing of bridge, commitment or financing fees, (D) payments made in respect of hedging obligations or
other derivative instruments entered into for the purpose of hedging interest rate risk, (E) cash contributions to any
employee stock ownership plan or similar trust to the extent such contributions are used by such plan or trust to pay
interest or fees to any Person (other than such Person or a wholly-owned Restricted Subsidiary) in connection with
Indebtedness incurred by such plan or trust, (F) all interest paid or payable with respect to discontinued operations, (G)
the interest portion of any deferred payment obligations, (H) all interest on any Indebtedness that is (x) Indebtedness of
others secured by any Lien on property owned or acquired by such Person or its Restricted Subsidiaries, whether or not
the obligations secured thereby have been assumed, but limited to the fair market value of such property or (y)
contingent obligations in respect of Indebtedness; provided that such interest expense shall be calculated after giving
effect to Hedge Agreements related to interest rates (including associated costs), but excluding unrealized gains and
losses with respect to such Hedge Agreements and (I) fees and expenses paid to
16
the Administrative Agent (in its capacity as such and for its own account) pursuant to the Loan Documents and fees and
expenses paid to the administrative agent, the collateral agent, trustee or other similar Persons for any other
Indebtedness permitted by Section 7.03; provided further that, when determining such interest expense in respect of any
Test Period ending prior to the first anniversary of the Closing Date, such interest expense will be calculated by
multiplying the aggregate amount of such interest expense accrued since the Closing Date by 365 and then dividing
such product by the number of days from and including the Closing Date to and including the last day of such Test
Period; plus
(ii)
taxes based on gross receipts, income, profits or revenue or capital, franchise, excise, property,
commercial activity, sales, use, unitary or similar taxes, and foreign withholding taxes, including (A) penalties and
interest and (B) tax distributions made to any direct or indirect holders of Equity Interests of such Person in respect of
any such taxes attributable to such Person and/or its Restricted Subsidiaries or pursuant to a tax sharing arrangement or
as a result of a tax distribution or repatriated fund; plus
(iii)
depreciation expense and amortization expense (including amortization and similar charges related
to goodwill, customer relationships, trade names, databases, technology, software, internal labor costs, deferred
financing fees or costs and other intangible assets); plus
(iv)
non-cash items (provided that if any such non-cash item represents an accrual or reserve for
potential cash items in any future period, (x) the Borrower may determine not to add back such non-cash item in the
current Test Period, (y) to the extent the Borrower decides to add back such non-cash expense or charge, the cash
payment in respect thereof in such future period will be subtracted from Consolidated Adjusted EBITDA in such future
period), including the following: (A) non-cash expenses in connection with, or resulting from, stock option plans,
employee benefit plans or agreements or post-employment benefit plans or agreements, or grants or sales of stock,
stock appreciation or similar rights, stock options, restricted stock, preferred stock or other similar rights, (B) non-cash
currency translation losses related to changes in currency exchange rates (including re-measurements of Indebtedness
(including intercompany Indebtedness) and any net non-cash loss resulting from hedge agreements for currency
exchange risk), (C) non-cash losses, expenses, charges or negative adjustments attributable to the movement in the
mark-to-market valuation of hedge agreements or other derivative instruments, including the effect of FASB
Accounting Standards Codification 815 and International Accounting Standard No. 9 and their respective related
pronouncements and interpretations, (D) non-cash charges for deferred tax asset valuation allowances, (E) any non-cash
impairment charge or asset write-off or write-down related to intangible assets (including goodwill), long-lived assets,
and Investments in debt and equity securities, (F) any non-cash charges or losses resulting from any purchase
accounting adjustment or any step-ups with respect to re-valuing assets and liabilities in connection with the
Transactions or any Investments either existing or arising after the Closing Date, (G) all non-cash losses from
Investments either existing or arising after the Closing Date recorded using the equity method and (H) the excess of
GAAP rent expense over actual cash rent paid during such period due to the use of straight line rent for GAAP
purposes and (z) any non-cash interest expense; plus
(v)
GAAP; plus
unusual, extraordinary, infrequent or non-recurring items, whether or not classified as such under
17
(vi)
charges, costs, losses, expenses or reserves related to: (A) restructuring (including restructuring
charges or reserves, whether or not classified as such under GAAP), severance, relocation, consolidation, integration or
other similar items, (B) strategic and/or business initiatives, business optimization (including costs and expenses
relating to business optimization programs, which, for the avoidance of doubt, shall include, without limitation,
implementation of operational and reporting systems and technology initiatives; strategic initiatives; retention;
severance; systems establishment costs; systems conversion and integration costs; contract termination costs; recruiting
and relocation costs and expenses; costs, expenses and charges incurred in connection with curtailments or
modifications to pension and post-retirement employee benefits plans; costs to start-up, pre-opening, opening, closure,
transition and/or consolidation of distribution centers, operations, officers and facilities) including in connection with
the Transactions and any Permitted Investment, any acquisition or other investment consummated prior to the Closing
Date and new systems design and implementation, as well as consulting fees and any one-time expense relating to
enhanced accounting function, (C) business or facilities (including greenfield facilities) start-up, opening, transition,
consolidation, shut-down and closing, (D) signing, retention and completion bonuses, (E) severance, relocation or
recruiting, (F) public company registration, listing, compliance, reporting and related expenses, (G) charges and
expenses incurred in connection with litigation (including threatened litigation), any investigation or proceeding (or any
threatened investigation or proceeding) by a regulatory, governmental or law enforcement body (including any attorney
general), and (H) expenses incurred in connection with casualty events or asset sales outside the ordinary course of
business; plus
(vii)
all (A) costs, fees and expenses relating to the Transactions, (B) costs, fees and expenses
(including diligence and integration costs) incurred in connection with (x) investments in any Person, acquisitions of
the Equity Interests of any Person, acquisitions of all or a material portion of the assets of any Person or constituting a
line of business of any Person, and financings related to any of the foregoing or to the capitalization of any Loan Party
or any Restricted Subsidiary or (y) other transactions that are out of the ordinary course of business of such Person and
its Restricted Subsidiaries (in each case of clause (x) and (y), including transactions considered or proposed but not
consummated), including Permitted Equity Issuances, Investments, acquisitions, dispositions, recapitalizations,
mergers, amalgamations, option buyouts and the incurrence, modification or repayment of Indebtedness (including all
consent fees, premium and other amounts payable in connection therewith) and (C) non-operating professional fees,
costs and expenses; plus
(viii)
items reducing Consolidated Net Income to the extent (A) covered by a binding indemnification
or refunding obligation or insurance to the extent actually paid or reasonably expected to be paid, (B) paid or payable
(directly or indirectly) by a third party that is not a Loan Party or a Restricted Subsidiary (except to the extent such
payment gives rise to reimbursement obligations) or with the proceeds of a contribution to equity capital of such Person
by a third party that is not a Loan Party or a Restricted Subsidiary or (C) such Person is, directly or indirectly,
reimbursed for such item by a third party; plus
(ix)
the amount of management, monitoring, consulting, transaction and advisory fees (including
termination fees) and related indemnities and expenses paid, payable or accrued in such Test Period (including any
termination fees payable in connection with the early termination of management and monitoring agreements); plus
18
(x)
the effects of purchase accounting, fair value accounting or recapitalization accounting (including
the effects of adjustments pushed down to such Person and its Subsidiaries) and the amortization, write-down or write-
off of any such amount; plus
(xi)
proceeds of business interruption insurance actually received (to the extent not counted in any
prior period in anticipation of such receipt) or, to the extent not counted in any prior period, reasonably expected to be
received; plus
(xii)
minority interest expense consisting of income attributable to Equity Interests held by third
parties in any non-wholly-owned Restricted Subsidiary; plus
(xiii)
all charges, costs, expenses, accruals or reserves in connection with the rollover, acceleration or
payout of Equity Interests held by officers or employees and all losses, charges and expenses related to payments made
to holders of options or other derivative Equity Interests of such Person or any direct or indirect parent thereof in
connection with, or as a result of, any distribution being made to equity holders of such Person or any direct or indirect
parent thereof, including (A) payments made to compensate such holders as though they were equity holders at the time
of, and entitled to share in, such distribution, and (B) all dividend equivalent rights owed pursuant to any compensation
or equity arrangement; plus
(xiv)
expenses, charges and losses resulting from the payment or accrual of indemnification or
refunding provisions, earn-outs and contingent consideration obligations; bonuses and other compensation paid to
employees, directors or consultants; and payments in respect of dissenting shares and purchase price adjustments; in
each case, made in connection with a Permitted Investment or other transactions disclosed in the documents referred to
in clause ((xix)) below; plus
(xv)
any losses from abandoned, closed, disposed or discontinued operations or operations that are
anticipated to become abandoned, closed, disposed or discontinued; plus
(xvi)
(A) any costs or expenses (including any payroll taxes) incurred by the Borrower or any
Restricted Subsidiary in such Test Period as a result of, in connection with or pursuant to any management equity plan,
profits interest or stock option plan or any other management or employee benefit plan or agreement, any pension plan
(including (1) any post-employment benefit scheme to which the relevant pension trustee has agreed, (2) as a result of
curtailments or modifications to pension and post-retirement employee benefit plans and (3) without limitation,
compensation arrangements with holders of unvested options entered into in connection with a permitted Restricted
Payment), any stock subscription, stockholders or partnership agreement, any payments in the nature of compensation
or expense reimbursement made to independent board members, any employee benefit trust, any employee benefit
scheme or any similar equity plan or agreement (including any deferred compensation arrangement), including any
payment made to option holders in connection with, or as a result of, any distribution being made to, or share
repurchase from, a shareholder, which payments are being made to compensate option holders as though they were
shareholders at the time of, and entitled to share in, such distribution or share repurchase and (B) any costs or expenses
incurred in connection with the rollover, acceleration or payout of Equity Interests held by management of Holdings (or
any Parent Entity, the Borrower and/or any Restricted Subsidiary); plus
19
(xvii)
the amount of loss or discount on sale of receivables, Securitization Assets and related assets to
any Securitization Subsidiary in connection with a Qualified Securitization Financing; plus
(xviii)
the cumulative effect of a change in accounting principles; plus
(xix)
addbacks reflected in the Model in connection with the Transactions or the quality of earnings
report delivered to the Lead Arrangers in connection with the Transactions; plus
(xx)
the amount of “run rate” cost savings, operating expense reductions and other cost synergies that
are projected by the Borrower in good faith to result from actions taken, committed to be taken or expected to be taken
no later than 36 months after the end of such Test Period (which amounts will be determined by the Borrower in good
faith and calculated on a pro forma basis as though such amounts had been realized on the first day of the Test Period
for which Consolidated Adjusted EBITDA is being determined), net of the amount of actual benefits realized during
such Test Period from such actions; provided that, in the good faith judgment of the Borrower such cost savings are
reasonably identifiable, reasonably anticipated to be realized and factually supportable (it being agreed such
determinations need not be made in compliance with Regulation S-X or other applicable securities law); plus
(xxi)
to the extent not included in Consolidated Net Income for such period, cash actually received (or
any netting arrangement resulting in reduced cash expenditures) during such period so long as the non-cash gain
relating to the relevant cash receipt or netting arrangement was deducted in the calculation of Consolidated Adjusted
EBITDA for any previous period and not added back; plus
(xxii)
[reserved]; plus
(xxiii)
the amount of any contingent payments in connection with the licensing of intellectual property
or other assets; plus
(xxiv)
Public Company Costs; plus
(xxv)
the amount of fees, expense reimbursements and indemnities paid to directors and/or members
of advisory boards, including directors of Holdings or any other Parent Entity; plus
(xxvi)
any net pension or other post-employment benefit costs representing amortization of
unrecognized prior service costs, actuarial losses, including amortization or such amounts arising in prior periods,
amortization of the unrecognized net obligation (and loss or cost) existing at the date of initial application of FASB
Accounting Standards Codification 715, and any other items of a similar nature; plus
(xxvii)
payments made pursuant to Earnouts; and
(b)
decreased, without duplication, by the following items of such Person and its Restricted Subsidiaries for such
Test Period determined on a consolidated basis in accordance with GAAP (solely to the extent increasing Consolidated Net
Income):
20
(i)
any amount which, in the determination of Consolidated Net Income for such period, has been
included for any non-cash income or non-cash gain, all as determined in accordance with GAAP (provided that if any
non-cash income or non-cash gain represents an accrual or deferred income in respect of potential cash items in any
future period, such Person may determine not to deduct the relevant non-cash gain or income in the then-current
period); plus
(ii)
the amount of any cash payment made during such period in respect of any non-cash accrual,
reserve or other non-cash charge that is accounted for in a prior period and that was added to Consolidated Net Income
to determine Consolidated Adjusted EBITDA for such prior period and that does not otherwise reduce Consolidated
Net Income for the current period; plus
(iii)
the excess of actual cash rent paid over rent expense during such period due to the use of straight-
line rent for GAAP purposes; plus
(iv)
the amount of any income or gain associated with any Restricted Subsidiary that is attributable to
any non-controlling interest and/or minority interest of any third party; plus
(v)
(vi)
any net income from disposed or discontinued operations; plus
any unusual, extraordinary, infrequent or non-recurring gains.
Notwithstanding the foregoing, the Consolidated Adjusted EBITDA (i) for the fiscal quarter ending September 30, 2020 shall be
$87,000,000, (ii) for the fiscal quarter ending December 31, 2020 shall be $91,000,000, (iii) for the fiscal quarter ending March 31, 2021
shall be $79,000,000 and (iv) for the fiscal quarter ending June 30, 2021 shall be $158,000,000, in each case, as such amounts may be
adjusted pursuant to the foregoing provisions and other pro forma adjustments permitted by this Agreement (including as necessary to give
Pro Forma Effect to any Specified Transaction).
“Consolidated Current Assets” means, as of any date of determination, the total assets of the Borrower and the Restricted
Subsidiaries on a consolidated basis that may properly be classified as current assets in conformity with GAAP, excluding cash and Cash
Equivalents, amounts related to current or deferred taxes based on income or profits, assets held for sale, loans (permitted) to third parties,
pension assets, deferred bank fees and derivative financial instruments, and excluding the effects of adjustments pursuant to GAAP resulting
from the application of recapitalization accounting or purchase accounting, as the case may be, in relation to the Transactions or any
consummated acquisition.
“Consolidated Current Liabilities” means, as at any date of determination, the total liabilities of the Borrower and the Restricted
Subsidiaries on a consolidated basis that may properly be classified as current liabilities in conformity with GAAP, excluding (a) the current
portion of any Funded Debt, (b) the current portion of interest, (c) accruals for current or deferred taxes based on income or profits,
(d) accruals of any costs or expenses related to restructuring reserves, (e) any revolving facility, (f) the current portion of any Capitalized
Lease Obligation, (g) deferred revenue arising from cash receipts that are earmarked for specific projects, (h) liabilities in respect of unpaid
earn-outs and (i) the current portion of any other long-term liabilities, and, furthermore, excluding the effects of adjustments pursuant to
GAAP resulting from the application of recapitalization accounting or purchase accounting, as the case may be, in relation to the Transaction
or any consummated acquisition.
“Consolidated Interest Expense” means, for any Test Period, the sum of:
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(a)
cash interest expense (including that attributable to Capitalized Leases), net of cash interest income, of the
Borrower and the Restricted Subsidiaries with respect to all outstanding Indebtedness of the Borrower and the Restricted
Subsidiaries, including all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’
acceptance financing and net costs under hedging agreements, plus
(b)
non-cash interest expense resulting solely from the amortization of original issue discount from the issuance
of Indebtedness of the Borrower and the Restricted Subsidiaries (excluding Indebtedness borrowed under this Agreement, the
Senior Secured Notes, and the ABL Credit Agreement in connection with and to finance the Transactions) at less than par, plus
(c)
pay-in-kind interest expense of the Borrower and the Restricted Subsidiaries payable pursuant to the terms of
the agreements governing such debt for borrowed money;
but excluding, for the avoidance of doubt, (i) amortization of deferred financing costs, debt issuance costs, commissions, fees and expenses
and any other amounts of non-cash interest other than referred to in clause ((b)) above (including as a result of the effects of acquisition
method accounting or pushdown accounting), (ii) non-cash interest expense attributable to the movement of the mark-to-market valuation of
obligations under hedging agreements or other derivative instruments pursuant to FASB Accounting Standards Codification No. 815-
Derivatives and Hedging, (iii) any one-time cash costs associated with breakage in respect of hedging agreements for interest rates, (iv)
commissions, discounts, yield, make whole premium and other fees and charges (including any interest expense) incurred in connection with
any receivables financing (including any Qualified Securitization Financing), (v) any “additional interest” owing pursuant to a registration
rights agreement with respect to any securities, (vi) any payments with respect to make-whole premiums or other breakage costs of any
Indebtedness, including any Indebtedness issued in connection with the Transactions, (vii) penalties and interest relating to taxes,
(viii) accretion or accrual of discounted liabilities not constituting Indebtedness, (ix) interest expense attributable to a direct or indirect Parent
Entity resulting from push-down accounting, (x) any expense resulting from the discounting of Indebtedness in connection with the
application of recapitalization or purchase accounting and (xi) any interest expense attributable to the exercise of appraisal rights and the
settlement of any claims or actions (whether actual, contingent or potential) with respect thereto and with respect to any Acquisition
Transaction or other Investment, all as calculated on a consolidated basis in accordance with GAAP. For the avoidance of doubt, (i) interest
expense shall be determined after giving effect to any net payments made or received by the Borrower and its Restricted Subsidiaries in
respect of Swap Contracts relating to interest rate protection and (ii) interest on a Capitalized Lease Obligation shall be deemed to accrue at
an interest rate reasonably determined by the Borrower to be the rate of interest implicit in such Capitalized Lease Obligation in accordance
with GAAP.
“Consolidated Net Debt” means, as of any date of determination, (a) Consolidated Total Debt minus (b) the aggregate amount of
cash and Cash Equivalents of the Borrower and the Restricted Subsidiaries as of such date that is not Restricted.
“Consolidated Net Income” means, with respect to any Person for any Test Period, the Net Income of such Person and its
Restricted Subsidiaries determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from such
consolidated net income (to the extent otherwise included therein), without duplication:
(a)
the Net Income for such Test Period of any Person that is not a Subsidiary, or is an Unrestricted Subsidiary, or
that is accounted for by the equity method of accounting; provided that the Borrower’s or any Restricted Subsidiary’s equity in the
Net Income of such Person shall be included in the Consolidated Net Income of the Borrower for such Test Period up to the
aggregate
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amount of dividends or distributions or other payments in respect of such equity that are actually paid in cash (or to the extent
converted into cash) by such Person to the Borrower or a Restricted Subsidiary, in each case, in such Test Period, to the extent not
already included therein (subject in the case of dividends, distributions or other payments in respect of such equity made to a
Restricted Subsidiary to the limitations contained in clause (b) below);
(b)
solely with respect to the calculation of Available Amount and Excess Cash Flow, the Net Income of any
Restricted Subsidiary of such Person during such Test Period to the extent that the declaration or payment of dividends or similar
distributions by such Restricted Subsidiary of that income is not permitted by operation of the terms of its Organization
Documents or any agreement, instrument or requirement of Law applicable to such Restricted Subsidiary during such Test Period;
provided that Consolidated Net Income of such Person shall be increased by the amount of dividends or distributions or other
payments that are actually paid in cash to such Person or its Restricted Subsidiaries in respect of such Test Period;
(c)
any gain (or loss), together with any related provisions for taxes on any such gain (or the tax effect of any
such loss), realized by such Person or any of its Restricted Subsidiaries during such Test Period upon any asset sale or other
disposition of any Equity Interests of any Person (other than any dispositions in the ordinary course of business) by such Person or
any of its Restricted Subsidiaries;
(d)
gains and losses due solely to fluctuations in currency values and the related tax effects determined in
accordance with GAAP for such Test Period;
(e)
earnings (or losses), including any impairment charge, resulting from any reappraisal, revaluation or write-up
(or write-down) of assets during such Test Period;
(f)
(i) unrealized gains and losses with respect to Hedge Agreements for such Test Period and the application of
Accounting Standards Codification 815 (Derivatives and Hedging) and (ii) any after-tax effect of income (or losses) for such Test
Period that result from the early extinguishment of (A) Indebtedness, (B) obligations under any Hedge Agreements or (C) other
derivative instruments;
(g)
any extraordinary, infrequent, non-recurring or unusual gain (or extraordinary, infrequent, non-recurring or
unusual loss), together with any related provision for taxes on any such gain (or the tax effect of any such loss), recorded or
recognized by such Person or any of its Restricted Subsidiaries during such Test Period;
(h)
the cumulative effect of a change in accounting principles and changes as a result of the adoption or
modification of accounting policies during such Test Period;
(i)
after-tax gains (or losses) on disposal of disposed, abandoned or discontinued operations for such Test Period;
(j)
effects of adjustments (including the effects of such adjustments pushed down to such Person and its
Restricted Subsidiaries) in the inventory, property and equipment, software, goodwill, other intangible assets, in-process research
and development, deferred revenue, debt and unfavorable or favorable lease line items in such Person’s consolidated financial
statements pursuant to GAAP for such Test Period resulting from the application of purchase accounting in relation to the
Transactions or any acquisition consummated prior to the Closing Date and any
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Permitted Acquisition or other Investment or the amortization or write-off of any amounts thereof, net of taxes, for such Test
Period;
(k)
any non-cash compensation charge or expense for such Test Period, including any such charge or expense
arising from the grants of stock appreciation or similar rights, stock options, restricted stock or other rights and any cash charges
or expenses associated with the rollover, acceleration or payout of Equity Interests by, or to, management of such Person or any of
its Restricted Subsidiaries in connection with the Transactions;
(l)
(i) Transaction Expenses incurred during such Test Period and (ii) any fees and expenses incurred during such
Test Period, or any amortization thereof for such Test Period, in connection with any acquisition (other than the Transactions),
Investment, disposition, issuance or repayment of Indebtedness, issuance of Equity Interests, refinancing transaction or
amendment or modification of any debt or equity instrument (in each case, including any such transaction whether consummated
on, after or prior to the Closing Date and any such transaction undertaken but not completed) and any charges or non-recurring
costs incurred during such Test Period as a result of any such transaction;
(m)
any expenses, charges or losses for such Test Period that are covered by indemnification or other
reimbursement provisions in connection with any Investment, Permitted Acquisition or any sale, conveyance, transfer or other
disposition of assets permitted under this Agreement, to the extent actually reimbursed, or, so long as the Borrower has made a
determination that a reasonable basis exists for indemnification or reimbursement and only to the extent that such amount is in fact
indemnified or reimbursed within 365 days of such determination (with a deduction in the applicable future period for any amount
so added back to the extent not so indemnified or reimbursed within such 365 days); and
(n)
to the extent covered by insurance and actually reimbursed, or, so long as the Borrower has made a
determination that there exists reasonable evidence that such amount will in fact be reimbursed within 365 days of the date of such
determination (with a deduction in the applicable future period for any amount so added back to the extent not so reimbursed
within such 365 days), expenses, charges or losses for such Test Period with respect to liability or casualty events or business
interruption.
“Consolidated Secured Net Debt” means, as of any date of determination, Consolidated Net Debt that is secured by a Lien on the
Collateral outstanding as of such date, other than Capitalized Lease Obligations.
“Consolidated Total Debt” means, as of any date of determination, the aggregate principal amount of third party Indebtedness of
the Borrower and the Restricted Subsidiaries outstanding on such date, determined on a consolidated basis and as reflected on the face of a
balance sheet prepared in accordance with GAAP (but excluding the effects of the application of purchase accounting in connection with the
Transactions, any Permitted Acquisition or any other Investment permitted hereunder), consisting of Indebtedness for borrowed money,
unreimbursed obligations in respect of drawn letters of credit (to the extent not cash collateralized), and obligations in respect of Capitalized
Leases and purchase money obligations and debt obligations evidenced by promissory notes or debentures; provided that Consolidated Total
Debt will not include Indebtedness in respect of (a) any Qualified Securitization Financing, (b) any letter of credit, except to the extent of
unreimbursed obligations in respect of drawn letters of credit (provided that any unreimbursed amount under commercial letters of credit will
not be counted as Consolidated Total Debt until three Business Days after such amount is drawn (it being understood that any borrowing,
whether automatic or otherwise, to fund such reimbursement will be counted)), (c) obligations
24
under Hedge Agreements, (d) obligations in respect of cash management obligations, (e) purchase money obligations incurred in the ordinary
course, trade payable and earn outs and similar obligations, (f) Indebtedness to the extent it has been cash collateralized, and (g) any lease
obligations other than in respect of Capitalized Leases.
“Consolidated Working Capital” means, as of any date of determination, the excess of Consolidated Current Assets over
Consolidated Current Liabilities.
“Contract Consideration” has the meaning specified in the definition of “Excess Cash Flow.”
“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.
“Contribution Indebtedness” means Indebtedness in an aggregate principal amount at the time of the incurrence thereof not to
exceed an amount equal to 200.00% of the amount of any Permitted Equity Issuances during the period from and including the Business Day
immediately following the Closing Date through and including the reference date that are Not Otherwise Applied.
“Control” has the meaning specified in the definition of “Affiliate.”
“Conversion/Continuation Notice” means a notice of (a) a conversion of Loans from one Type to another or (b) a continuation of
Eurocurrency Rate Loans, pursuant to Article II, which, if in writing, shall be substantially in the form of Exhibit A-2.
“Covered Entity” means any of the following:
(a)
(b)
(c)
a “covered entity” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 252.82(b);
a “covered bank” as that term is defined in, and interpreted in accordance with, 12 C.F.R § 47.3(b); or
a “covered FSI” as that term is defined in, and interpreted in accordance with, 12 C.F.R. § 382.2(b).
“Covered Party” has the meaning specified in Section 10.26(b).
“Credit Agreement Refinancing Indebtedness” means Indebtedness of the Borrower or any Restricted Subsidiary in the form of
term loans or notes or revolving commitments; provided that:
(a)
such Indebtedness is incurred or otherwise obtained (including by means of the extension or renewal of
existing Indebtedness) in exchange for, or to extend, renew, replace, or refinance, in whole or part, Indebtedness that is either Term
Loans or other Credit Agreement Refinancing Indebtedness (together, “Refinanced Debt”);
(b)
such Indebtedness is in an original aggregate principal amount not greater than the principal amount of the
Refinanced Debt being exchanged, extended, renewed, replaced or refinanced (plus (i) the amount of all unpaid, accrued, or
capitalized interest, penalties, premiums (including tender premiums) and other amounts payable with respect to the Refinanced
Debt, (ii) underwriting discounts, fees, commissions, costs, expenses and other amounts payable
25
(including the amount of all original issue discount) with respect to such Credit Agreement Refinancing Indebtedness) and (iii)
any existing unutilized commitment swith respect to such Refinanced Debt;
(c)
except for Indebtedness incurred pursuant to the Inside Maturity Exception, (i) the Weighted Average Life to
Maturity of such Indebtedness is equal to or longer than the remaining Weighted Average Life to Maturity of the Refinanced Debt,
and (ii) the final maturity date of such Credit Agreement Refinancing Indebtedness may not be earlier than the final maturity date
of the Refinanced Debt;
(d)
any mandatory prepayments (and with respect to any Credit Agreement Refinancing Indebtedness
comprising revolving loans, to the extent commitments thereunder are permanently terminated) of,
(i)
any Credit Agreement Refinancing Indebtedness that comprises notes or term loans that are either
secured by Liens that are junior in priority to Liens securing Term Loans or are not secured by Liens on any Collateral
may not be made, except to the extent that prepayments are (A) permitted hereunder and (B) to the extent required
hereunder, first made or offered to the Loans (and any other Pari Passu Lien Debt, if applicable), on a pro rata basis;
and
(ii)
any Credit Agreement Refinancing Indebtedness that is Pari Passu Lien Debt shall be made on a
pro rata basis or less than pro rata basis with any corresponding mandatory prepayment of the Term Loans required
hereunder and the Senior Secured Notes and any other Pari Passu Lien Debt to the extent required thereunder (but not
greater than a pro rata basis); provided this clause ((ii)) will not prohibit any repayment of such Credit Agreement
Refinancing Indebtedness at maturity or with the proceeds of other Credit Agreement Refinancing Indebtedness;
(e)
such Indebtedness is not guaranteed by any Subsidiary Loan Party other than a Subsidiary Guarantor
(including any Subsidiary that becomes a Subsidiary Guarantor in connection therewith); and
(f)
if such Indebtedness is secured:
(i)
such Indebtedness is not secured by a Lien on any assets or property of a Loan Party that does not
constitute Collateral (except (1) customary cash collateral in favor of an agent, letter of credit issuer or similar
“fronting” lender, (2) Liens on property or assets applicable only to periods after the Latest Maturity Date of the Term
Loans at the time of incurrence, (3) Liens on the proceeds of such Indebtedness funded into escrow pursuant to
customary escrow arrangements, (4) any Liens on property or assets to the extent that a Lien on such property or asset
is also added for the benefit of the Lenders under the Term Loans and (5) Excluded Assets);
(ii)
to the extent the Credit Agreement Refinancing Indebtedness is required to be subject to the
provisions of the Closing Date ABL Intercreditor Agreement, a Debt Representative acting on behalf of the holders of
such Indebtedness has become party to, or is otherwise subject to the provisions of the Closing Date ABL Intercreditor
Agreement or any other intercreditor agreement that may be executed from time to time and reasonably acceptable to
the Administrative Agent;
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(iii)
a Debt Representative acting on behalf of the holders of such Indebtedness has become party to, or
is otherwise subject to the provisions of, (A) if such Indebtedness is Pari Passu Lien Debt, an Equal Priority
Intercreditor Agreement or (B) if such Indebtedness is Junior Lien Debt, a Junior Lien Intercreditor Agreement.
Credit Agreement Refinancing Indebtedness will be deemed to include any Registered Equivalent Notes issued in exchange therefor.
“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being
established by the Administrative Agent in accordance with the conventions for this rate recommended by the Relevant Governmental Body
for determining “Daily Simple SOFR” for syndicated business loans; provided, that if the Administrative Agent decides that any such
convention is not administratively feasible for the Administrative Agent, then the Administrative Agent may establish another convention in
its reasonable discretion.
“Debt Representative” means, with respect to any series of Indebtedness secured by a Lien that is subject to an Intercreditor
Agreement, or is subordinated in right of payment to all or any part of the Obligations, the trustee, administrative agent, collateral agent,
security agent or similar agent under the indenture or agreement pursuant to which such Indebtedness is issued, incurred or otherwise
obtained, as the case may be, and each of their successors in such capacities.
“Debtor Relief Laws” means the Bankruptcy Code, the Bankruptcy and Insolvency Act (Canada), the Companies’ Creditors
Arrangement Act (Canada), the Winding-up and Restructuring Act (Canada), and all other liquidation, conservatorship, bankruptcy,
assignment for the benefit of creditors, moratorium, arrangement, rearrangement, receivership, insolvency, reorganization, or similar debtor
relief Laws of the United States, Canada or other applicable jurisdictions from time to time in effect and affecting the rights of creditors
generally, including any applicable corporations legislation to the extent the relief sought under such corporations legislation relates to or
involves the compromise, settlement, adjustment or arrangement of debt.
“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the passage of
time, or both, would be an Event of Default.
“Default Rate” means an interest rate equal to (a) the Base Rate plus (b) the Applicable Rate applicable to Base Rate Loans plus
(c) 2.00% per annum; provided that with respect to the outstanding principal amount of any Loan not paid when due, the Default Rate shall
be an interest rate equal to the interest rate (including any Applicable Rate) otherwise applicable to such Loan (giving effect to
Section 2.02(c)) plus 2.00% per annum, in each case, to the fullest extent permitted by applicable Laws.
“Default Right” has the meaning assigned to that term in, and shall be interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2
or 382.1, as applicable.
“Defaulting Lender” means, subject to Section 2.16(b), any Lender that,
(a)
has failed to (i) fund all or any portion of its Loans within two Business Days of the date such Loans were
required to be funded hereunder unless such Lender notifies the Administrative Agent and the Borrower in writing that such
failure is the result of such Lender’s determination that one or more conditions precedent to funding (which conditions precedent,
together with the applicable default, if any, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the
Administrative Agent or any other Lender any other amount required to be paid by it hereunder within two Business Days of the
date when due;
27
(b)
has notified the Borrower, the Administrative Agent or any Lender in writing that it does not intend to
comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public
statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s
determination that a condition precedent to funding (which condition precedent, together with the applicable default, if any, shall
be specifically identified in such writing or public statement) cannot be satisfied);
(c)
has failed, within three Business Days after written request by the Administrative Agent or the Borrower, to
confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations
hereunder; provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause ((c)) upon receipt of such
written confirmation by the Administrative Agent and the Borrower; or
(d)
the Administrative Agent or the Borrower has received notification that such Lender is, or has a direct or
indirect parent entity that is, (i) insolvent, or is generally unable to pay its debts as they become due, or admits in writing its
inability to pay its debts as they become due, or makes a general assignment for the benefit of its creditors, (ii) other than via an
Undisclosed Administration, the subject of a bankruptcy, insolvency, reorganization, liquidation or similar proceeding, or a
receiver, trustee, conservator, intervenor or sequestrator, administrator, assignee for the benefit of creditors or similar Person
charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any
other Federal or state regulatory authority acting in such a capacity or the like has been appointed for such Lender or its direct or
indirect parent entity, or such Lender or its direct or indirect parent entity has taken any action in furtherance of or indicating its
consent to or acquiescence in any such proceeding or appointment or (iii) become the subject of a Bail-In Action; provided that a
Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any Equity Interest in that Lender or
any direct or indirect parent entity thereof by a Governmental Authority so long as such ownership interest does not result in or
provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments
or writs of attachment on its assets or permit such Lender (or such Governmental Authority or instrumentality) to reject, repudiate,
disavow or disaffirm any contracts or agreements made with such Lender.
Any determination by the Administrative Agent or the Borrower that a Lender is a Defaulting Lender under clauses (a) through ((d)) above
shall be conclusive absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 2.16) upon delivery
of written notice of such determination to the Borrower, the Administrative Agent and each Lender.
“Delayed Draw Closing Date” means the date of any Borrowing of Delayed Draw Term Loans in accordance with Sections
2.01(a) and 4.02.
“Delayed Draw Commitment” means, as to each Lender, its obligation to make a Delayed Draw Term Loan to the Borrower
hereunder during the Delayed Draw Commitment Period, expressed as an amount representing the maximum principal amount of the
Delayed Draw Term Loans to be made by such Lender under this Agreement, as such commitment may be (a) automatically reduced to $0 on
the Delayed Draw Commitment Termination Date, (b) reduced from time to time pursuant to Section 2.05 and (c) reduced or increased from
time to time pursuant to (i) assignments by or to such Lender pursuant to an Assignment and Assumption, (ii) a Refinancing Amendment or
(iii) an Extension. The initial amount of each Lender’s Delayed Draw Commitment is set forth on Schedule 2.01 under the caption “Delayed
Draw Commitment” or, otherwise, in the Assignment and Assumption or Refinancing Amendment pursuant to which such Lender shall have
assumed its Delayed Draw Commitment, as the case may be. The initial aggregate amount of the Delayed Draw Commitments is
$250,000,000.
28
“Delayed Draw Commitment Period” means the period from the Closing Date to and including the Delayed Draw Commitment
Termination Date.
“Delayed Draw Commitment Termination Date” means the earliest to occur of (i) 5:00 p.m. New York City time on the date
that is 90 days after the Closing Date (at which date and time all unfunded Delayed Draw Commitments shall automatically be reduced to
$0), (ii) the date on which any Delayed Draw Commitments then outstanding have been funded in a Borrowing pursuant to Section 2.01(a)
and (iii) the date on which all unfunded Delayed Draw Commitments have been reduced to $0 pursuant to Section 2.05(c) or terminated by
the Borrower pursuant to Section 8.02.
“Delayed Draw Term Loan” has the meaning assigned to such term in Section 2.01(a).
“Delayed Draw Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding
principal Dollar Amount of the Delayed Draw Term Loans of such Lender; provided, at any time prior to the making of the Delayed Draw
Term Loans, the Delayed Draw Term Loan Exposure of any Lender shall be equal to the Dollar Amount such Lender’s Delayed Draw
Commitment.
“Delayed Draw Ticking Fee” has the meaning assigned to such term in Section 2.08(e).
“Delayed Draw Upfront Fee” has the meaning assigned to such term in Section 2.08(b).
“Deliverable Obligation” means each obligation of the Loan Parties that would constitute a “Deliverable Obligation” under a
market standard credit default swap transaction documented under the ISDA CDS Definitions and specifying any of the Loan Parties as a
Reference Entity. Each capitalized term used but not defined in the preceding sentence has the meaning specified in the ISDA CDS
Definitions, as applicable.
“Derivative Instrument” means with respect to a Person, any contract or instrument to which such Person is a party (whether or
not requiring further performance by such Person), the value and/or cash flows of which (or any portion thereof) are based on the value
and/or performance of the Loans and/or any Deliverable Obligations or “Obligations” (as defined in the ISDA CDS Definitions) with respect
to the Loan Parties; provided that a “Derivative Instrument” will not include any contract or instrument that is entered into pursuant to bona
fide market-making activities.
“Designated Jurisdiction” means any country or territory to the extent that such country or territory is the subject of any
Sanctions.
“Designated Non-Cash Consideration” means the fair market value of any non-cash consideration received by the Borrower or a
Restricted Subsidiary in connection with a Disposition pursuant to the General Asset Sale Basket that is designated as Designated Non-Cash
Consideration pursuant to a certificate of a Responsible Officer (which amount will be reduced by the fair market value of the portion of the
non-cash consideration converted to cash within one hundred eighty days following the consummation of the applicable Disposition).
“Disposition” or “Dispose” means the sale, transfer, license, lease or other disposition including any sale of Equity Interests in, or
issuance of Equity Interests by, a Restricted Subsidiary (excluding Liens and including, for the avoidance of doubt, any Division) of any
property by any Person.
“Disqualified Equity Interests” means any Equity Interest that, by its terms (or by the terms of any security or other Equity
Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition,
29
(a)
matures or is mandatorily redeemable (other than solely for Qualified Equity Interests), pursuant to a sinking
fund obligation or otherwise (except as a result of a change of control or asset sale, as long as any rights of the holders thereof
upon the occurrence of a change of control or asset sale event is subject to the prior repayment in full of the Loans and all other
Obligations that are accrued and payable and the termination of the Commitments);
in part;
(b)
(c)
(d)
is redeemable at the option of the holder thereof (other than solely for Qualified Equity Interests), in whole or
provides for the scheduled payments of dividends that are required to be made only in cash; or
is or becomes convertible into or exchangeable for Indebtedness or any other Equity Interests that would
constitute Disqualified Equity Interests;
in each case, prior to the Latest Maturity Date of the Loans at the time of issuance; provided that if such Equity Interests are issued pursuant
to a plan for the benefit of one or more Company Persons or by any such plan to one or more Company Persons, such Equity Interests shall
not constitute Disqualified Equity Interests solely because they may be required to be repurchased by Holdings, the Borrower or the
Restricted Subsidiaries in order to satisfy applicable statutory or regulatory obligations or as a result of a Company Person’s termination,
death or disability; provided, further, that any class of Equity Interests of such Person that by its terms authorizes such Person to satisfy its
obligations thereunder by delivery of Equity Interests that is not Disqualified Equity Interests shall not be deemed to be Disqualified Equity
Interests.
“Disqualified Lender” means,
(a)
the competitors of the Borrower and its Subsidiaries identified in writing by or on behalf of the Borrower
(i) to the Lead Arrangers on or prior to the Closing Date, or (ii) to the Administrative Agent, from time to time on or after the
Closing Date;
(b)
(i) any Persons that are engaged as principals primarily in private equity or venture capital (other than a bona
fide debt fund affiliate of any of the Lead Arrangers) and (ii) those particular banks, financial institutions, other institutional
lenders and other Persons, in the case of each of clauses (i) and (ii), to the extent identified in writing by or on behalf of the
Borrower to the Lead Arrangers on or prior to May 10, 2021; and
(c)
any Affiliate of a Person described in the preceding clauses (a) or (b) that (in each case with respect to clause
(a) above, other than any Affiliates that are banks, financial institutions, bona fide debt funds or investment vehicles that are
engaged in making, purchasing, holding or otherwise investing in commercial loans, bonds and similar extensions of credit in the
ordinary course), in each case, is either reasonably identifiable as such on the basis of its name or is identified as such in writing
by or on behalf of the Borrower (i) to the Lead Arrangers on or prior to the Closing Date, or (ii) to the Administrative Agent from
time to time on or after the Closing Date.
The Borrower may, in its discretion, make the list of Disqualified Lenders available to any Lender, Participant, or any prospective
Lender or Participant, upon request by such Lender, Participant or prospective Lender or Participant, as applicable. The Borrower shall, upon
request of any Lender, identify whether any Person identified by such Lender as a proposed assignee or Participant is a Disqualified Lender.
To the extent Persons are identified as Disqualified Lenders after the Closing Date pursuant to clauses (a) or (c) above, the inclusion of such
Persons as Disqualified Lenders shall not retroactively apply to prior assignments or participations made in compliance with Section 10.07
hereof.
30
“Division” has the meaning specified in Section 1.02(d).
“Dollar” and “$” mean lawful money of the United States.
“Dollar Amount” means, at any time:
(a)
with respect to any Loan denominated in Dollars, the principal amount thereof then outstanding (or in which
such participation is held); and
(b)
with respect to any other amount (i) if denominated in Dollars, the amount thereof, or (ii) if denominated in
any currency other than Dollars, the equivalent amount thereof in Dollars as determined by the Administrative Agent on the basis
of the Exchange Rate (determined in respect of the most recent relevant date of determination) for the purchase of Dollars with
such currency.
“Domestic Subsidiary” means any Subsidiary that is organized under the Laws of the United States, any state thereof or the
District of Columbia.
“Early Opt-in Effective Date” means, with respect to any Early Opt-in Election, the sixth (6th) Business Day after the date notice
of such Early Opt-in Election is provided to the Lenders, so long as the Administrative Agent has not received, by 5:00 p.m. (New York City
time) on the fifth (5th) Business Day after the date notice of such Early Opt-in Election is provided to the Lenders, written notice of objection
to such Early Opt-in Election from Lenders comprising the Required Lenders.
“Early Opt-in Election” means the occurrence of:
(1) a notification by the Administrative Agent to (or the request by the Borrower to the Administrative Agent to notify)
each of the other parties hereto that at least five currently outstanding U.S. dollar-denominated syndicated credit facilities at such
time contain (as a result of amendment or as originally executed) a SOFR-based rate (including SOFR, a term SOFR or any other
rate based upon SOFR) as a benchmark rate (and such syndicated credit facilities are identified in such notice and are publicly
available for review), and
(2) the joint election by the Administrative Agent and the Borrower to trigger a fallback from USD LIBOR and the
provision by the Administrative Agent of written notice of such election to the Lenders.
“Earnouts” means (a) all earnout payments or other contingent payments in connection with any Permitted Investment and (b)
Existing Earnouts and Unfunded Holdbacks.
“ECF Prepayment Percentage” means,
(a)
50%, if the Borrower’s First Lien Net Leverage Ratio at the end of the immediately preceding fiscal year
equals or exceeds the Closing Date First Lien Net Leverage Ratio less 0.50 to 1.00;
(b)
25%, if such First Lien Net Leverage Ratio is less than the Closing Date First Lien Net Leverage Ratio less
0.50 to 1.00, but equals or exceeds the Closing Date First Lien Net Leverage Ratio less 1.00 to 1.00; and
31
(c)
1.00 to 1.00.
0%, if such First Lien Net Leverage Ratio is less than the Closing Date First Lien Net Leverage Ratio less
“EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which
is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an
institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a
subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
“EEA Member Country” means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative
authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Eligible Assignee” means any Person that meets the requirements to be an assignee under Section 10.07(b)(v); provided that the
following Persons shall not be Eligible Assignees: (a) any Defaulting Lender, (b) any Person that is Disqualified Lender and (c) unless
approved by the Borrower in its sole discretion (for the avoidance of doubt, without giving effect to the proviso set forth in Section 10.07(b)
(iii)(A), if applicable), any prospective Lender or Participant that would be a Net Short Lender immediately after giving effect to the
assignment or participation pursuant to which such prospective Lender or Participant would become an actual Lender or Participant, as
applicable.
“Environmental Claim” means any and all administrative, regulatory or judicial actions, suits, demands, demand letters, claims,
liens, notices of noncompliance or violation, investigations by any Governmental Authority, or proceedings with respect to any
Environmental Liability or pursuant to Environmental Law, including those (a) by any Governmental Authority for enforcement, cleanup,
removal, response, remedial or other actions or damages pursuant to any Environmental Law and (b) by any Person seeking damages,
contribution, indemnification, cost recovery, compensation or injunctive relief pursuant to any Environmental Law.
“Environmental Laws” means any and all Laws relating to the protection of the environment or, to the extent relating to exposure
to Hazardous Materials, human health.
“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of
environmental remediation, fines, penalties or indemnities), of any Loan Party or any of the Restricted Subsidiaries, directly or indirectly,
resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous
Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or
imposed with respect to any of the foregoing.
“Environmental Permit” means any permit, approval, identification number, license or other authorization required under or
issued pursuant to any Environmental Law.
“Equal Priority Intercreditor Agreement” means the Closing Date Equal Priority Intercreditor Agreement or, if requested by
the providers of Indebtedness permitted hereunder to be Pari Passu Lien Debt, another pari passu intercreditor arrangement reasonably
satisfactory to the Administrative Agent, the Collateral Agent and the Borrower, in each case as amended, restated, amended and restated,
modified or
32
supplemented from time to time in accordance with the terms hereof and thereof. Upon the request of the Borrower, the Administrative
Agent and the Collateral Agent will execute and deliver an Equal Priority Intercreditor Agreement with one or more Debt Representatives for
Pari Passu Lien Debt permitted hereunder.
“Equity Contribution” means, the direct or indirect contribution (including pursuant to a merger) to the Initial Borrower (or a
direct or indirect parent thereof) by Jackson Wijaya, and other co-investors in exchange for common equity of the Initial Borrower (or such
direct or indirect parent). Any such parent will contribute, or cause to be contributed, all such cash and equity to the Initial Borrower
substantially simultaneously with (or prior to) the funding of the Initial Term Loans, the Senior Secured Notes and the initial borrowings
under the ABL Credit Facilities. The aggregate amount of the Equity Contribution will represent not less than 45% (the “Minimum Equity
Contribution”) of the sum of (i) the aggregate principal amount of the loans funded under the ABL Credit Facility on the Closing Date,
other than letters of credit and amounts borrowed to cash collateralize letters of credit or to fund certain OID or upfront fees, (ii) the
aggregate principal amount of the Initial Term Loans funded on the Closing Date and the and the aggregate principal amount of Senior
Secured Notes issued under the Senior Secured Notes Indenture on the Closing Date (other than amounts held in escrow on the Closing Date
to fund repurchases of the Existing Notes after the Closing Date), (iv) the aggregate amount of Existing Notes that are not repurchased,
redeemed, defeased or satisfied and discharged on or prior to the Closing Date and (v) the cash amounts of the Minimum Equity
Contribution, in each case, on the Closing Date; provided, further that Jackson Wijaya shall directly or indirectly control at least a majority of
the ordinary voting power of Holdings after giving effect to the Transactions.
“Equity Interests” means, with respect to any Person, all of the shares, interests, rights, participations or other equivalents
(however designated) of capital stock of (or other ownership or profit interests or units in, including any limited or general partnership
interest and any limited liability company membership interest) such Person and all of the warrants, options or other rights for the purchase,
acquisition or exchange from such Person of any of the foregoing (including through convertible securities).
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and
regulations promulgated thereunder.
“ERISA Affiliate” means any trade or business (whether or not incorporated) that together with any Loan Party is treated as a
single employer within the meaning of Section 414 of the Code or Section 4001 of ERISA. For the avoidance of doubt, when any provision
of this Agreement relates to a past event or period of time, the term “ERISA Affiliate” includes any Person who was, as to the time of such
past event or period of time, an ERISA Affiliate within the meaning of the preceding sentence.
“ERISA Event” means (a) a Reportable Event with respect to a Pension Plan; (b) a withdrawal by any Loan Party or any of their
respective ERISA Affiliates from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer
(as defined in Section 4001(a)(2) of ERISA) or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of
ERISA; (c) a complete or partial withdrawal by any Loan Party or any of their respective ERISA Affiliates from a Multiemployer Plan,
written notification of any Loan Party or any of their respective ERISA Affiliates concerning the imposition of Withdrawal Liability or
written notification that a Multiemployer Plan is insolvent within the meaning of Title IV of ERISA; (d) the filing under Section 4041(c) of
ERISA of a notice of intent to terminate a Pension Plan, the treatment of a Pension Plan or Multiemployer Plan amendment as a termination
under Sections 4041 or 4041A of ERISA, or the commencement of proceedings by the PBGC to terminate a Pension Plan or Multiemployer
Plan; (e) the imposition of any liability under Title IV of ERISA, other than for the payment of plan contributions or PBGC premiums due
but not delinquent under Section 4007 of ERISA, upon any Loan Party or any of their respective ERISA
33
Affiliates; (f) the failure to satisfy the minimum funding standards (within the meaning of Section 412 of the Code or Section 302 of ERISA)
with respect to any Pension Plan; (g) the application for a minimum funding waiver under Section 302(c) of ERISA with respect to a Pension
Plan; (h) the imposition of a lien under Section 303(k) of ERISA with respect to any Pension Plan or (i) a determination that any Pension
Plan is in “at risk” status (within the meaning of Section 303 of ERISA).
“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or
any successor person), as in effect from time to time.
“Eurocurrency Rate” means:
(a)
for any Interest Period with respect to a Eurocurrency Rate Loan denominated in Dollars, the rate per annum
equal to (i) the ICE LIBOR Rate (“ICE LIBOR”), as published on the applicable Thomson Reuters screen page (or such other
commercially available source providing quotations of ICE LIBOR as may be designated by the Administrative Agent from time
to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for
Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period or (ii) if such
rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the rate at which
deposits in Dollars for delivery on the first day of such Interest Period in Same Day Funds in the approximate amount of the
Eurocurrency Rate Loan being made, continued or converted and with a term equivalent to such Interest Period would be offered
by the Administrative Agent to major banks in the London interbank eurodollar market at their request at approximately
11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period;
(b)
[reserved];
(c)
for any Interest Period with respect to a Eurocurrency Rate Loan denominated in an Alternative Currency, the
rate per annum equal to (i) the rate, as published on the applicable Thomson Reuters screen page (or such other commercially
available source providing quotations of LIBOR as may be designated by the Administrative Agent from time to time) at
approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for deposits in
such Alternative Currency (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period or
(ii) if such rate is not available at such time for any reason, the rate per annum determined by the Administrative Agent to be the
rate at which deposits in such Alternative Currency for delivery on the first day of such Interest Period in Same Day Funds in the
approximate amount of the Eurocurrency Rate Loan being made, continued or converted and with a term equivalent to such
Interest Period would be offered by the Administrative Agent to major banks in the London interbank market at their request at
approximately 11:00 a.m. (London time) two Business Days prior to the commencement of such Interest Period; and
(d)
for any interest calculation with respect to a Base Rate Loan on any date, the rate per annum equal to (i) ICE
LIBOR, at approximately 11:00 a.m., London time determined two Business Days prior to such date for Dollar deposits being
delivered in the London interbank market for a term of one month commencing that day or (ii) if such published rate is not
available at such time for any reason, the rate per annum determined by the Administrative Agent to be the rate at which deposits
in Dollars for delivery on the date of determination in Same Day Funds in the approximate amount of the Base Rate Loan being
made or maintained and with a term equal to one month would be offered by the Administrative Agent to major banks in the
London interbank eurodollar market at their request at the date and time of determination.
34
“Eurocurrency Rate Loan” means a Loan, whether denominated in Dollars or any Alternative Currency, that bears interest at a
rate based on clause (a), (b) or (c), as applicable, of the definition of “Eurocurrency Rate.”
“Event of Default” has the meaning specified in Section 8.01.
“Excess Cash Flow” means, for any period, an amount equal to the excess of:
(a)
the sum, without duplication, of:
(i)
Consolidated Net Income of the Borrower and the Restricted Subsidiaries for such period, plus
(ii)
an amount equal to the amount of all non-cash charges (including depreciation and amortization)
for such period to the extent deducted in arriving at such Consolidated Net Income, but excluding any such non-cash
charges representing an accrual or reserve for potential cash items in any future period and excluding amortization of a
prepaid cash item that was paid in a prior period, plus
(iii)
decreases in Consolidated Working Capital for such period (other than any such decreases arising
from acquisitions or Dispositions by the Borrower and the Restricted Subsidiaries completed during such period, the
application of purchase accounting or the reclassification of items from short term to long term or vice versa), plus
(iv)
an amount equal to the aggregate net non-cash loss on Dispositions by the Borrower and the
Restricted Subsidiaries during such period (other than Dispositions in the ordinary course of business) to the extent
deducted in arriving at such Consolidated Net Income, plus
(v)
the amount deducted as tax expense in determining Consolidated Net Income to the extent in
excess of cash taxes paid in such period (including, without duplication, tax distributions pursuant to Section 7.06(h)(i))
and tax distribution reserves set aside or payable), plus
(vi)
cash receipts in respect of Hedge Agreements during such period to the extent not otherwise
included in such Consolidated Net Income; over
(b)
the sum, without duplication, of:
(i)
an amount equal to the amount of all non-cash credits included in arriving at such Consolidated Net
Income (but excluding any non-cash credit to the extent representing the reversal of an accrual or reserve described in
clause (a)(ii) above) and cash charges excluded by virtue of clauses ((a)) through (l) (other than clause (g)) of the
definition of “Consolidated Net Income”, plus
(ii)
without duplication of amounts deducted pursuant to clause (b)(xi) below or this clause (b)(ii) in
prior periods, and any amounts deducted pursuant to Section 2.04(b)(i)(B), the amount of Capital Expenditures or
acquisitions of intellectual property accrued or made in cash during such period to the extent not financed with the
proceeds of Funded Debt, plus
35
(iii)
the aggregate amount of all principal payments of Indebtedness (including the principal
component of payments in respect of Capitalized Leases) of the Borrower and the Restricted Subsidiaries to the extent
such prepayments or repayments are not funded with the proceeds of Funded Debt, excluding (A) all payments of
Indebtedness described in Section 2.04(b)(i)(B)(I)-(II) to the extent such payments reduce the repayment of Term
Loans that would otherwise be required by Section 2.04(b)(i), (B) all payments of Indebtedness pursuant to and in
accordance with Section 7.09(a)(x)(A), and (C) any prepayment of revolving loans to the extent there is not an
equivalent permanent reduction in commitments thereunder, plus
(iv)
an amount equal to the aggregate net non-cash gain on Dispositions by the Borrower and the
Restricted Subsidiaries during such period (other than Dispositions in the ordinary course of business) to the extent
included in arriving at such Consolidated Net Income and the net cash loss on Dispositions to the extent otherwise
added to arrive at Consolidated Net Income, plus
(v)
increases in Consolidated Working Capital for such period (other than any such increases arising
from acquisitions or Dispositions by the Borrower and the Restricted Subsidiaries completed during such period, the
application of purchase accounting or the reclassification of items from short term to long term or vice versa), plus
(vi)
cash payments by the Borrower and the Restricted Subsidiaries actually made during such period
to the extent not financed with the proceeds of Funded Debt in respect of any purchase price holdbacks, earn-out
obligations, long-term liabilities of the Borrower and the Restricted Subsidiaries (other than Indebtedness) to the extent
such payments are not expensed during such period or are not deducted in calculating Consolidated Net Income for
such period (and so long as there has not been any reduction in respect of such payments in arriving at Consolidated
Net Income for such fiscal year), plus
(vii)
without duplication of amounts deducted pursuant to clauses (viii) and (xi) below in prior periods,
the amount of Permitted Investments, including Acquisition Transactions (in each case, including costs and expenses
related thereto), made during such period pursuant to Section 7.02 (excluding Section 7.02(hh)(i)) to the extent that
such Permitted Investments were not financed with the proceeds of Funded Debt;
(viii)
the amount of Restricted Payments actually paid (and permitted to be paid) during such period
pursuant to Section 7.06 (excluding Sections 7.06(a) and 7.06(c)) to the extent such Restricted Payments were not
financed with the proceeds of Funded Debt;
(ix)
the aggregate amount of expenditures actually made by the Borrower and its Restricted
Subsidiaries to the extent not financed with the proceeds of Funded Debt during such period (including expenditures for
the payment of financing fees) to the extent that such expenditures are not expensed during such fiscal year or are not
deducted in calculating Consolidated Net Income (and so long as there has not been any reduction in respect of such
expenditures in arriving at Consolidated Net Income for such period); and
(x)
to the extent such were not deducted in calculating Consolidated Net Income for such period, the
aggregate amount of any premium, make-whole or penalty payments actually paid in cash by Holdings, the Borrower
and the Restricted Subsidiaries during such period that are made in connection with any prepayment of any principal of
36
Indebtedness to the extent such prepayment of principal reduced Excess Cash Flow pursuant to clause (b)(iii) above or
reduced the mandatory prepayment required by Section 2.04(b)(i), plus
(xi)
without duplication of amounts deducted from Excess Cash Flow in prior periods, the aggregate
consideration required to be paid in cash by the Borrower or any of the Restricted Subsidiaries pursuant to binding
contracts, commitments, or binding purchase orders (to the extent not financed with the proceeds of Funded Debt, the
“Contract Consideration”) entered into prior to or during such period relating to Permitted Acquisitions, Permitted
Investments, Capital Expenditures or acquisitions of intellectual property to be consummated; provided that, to the
extent the aggregate amount actually utilized to finance such Permitted Acquisitions, Permitted Investments, Capital
Expenditures or acquisitions of intellectual property during any period is less than the Contract Consideration that
reduced Excess Cash Flow for the prior period, the amount of such shortfall shall be added to the calculation of Excess
Cash Flow for such period, plus
(xii)
the amount of cash taxes (including penalties and interest) paid or tax reserves set aside or
payable (without duplication) in such period, to the extent they exceed the amount of tax expense deducted in
calculating Consolidated Net Income for such period, plus
(xiii)
cash expenditures in respect of Hedge Agreements during such period to the extent not deducted
in calculating Consolidated Net Income; plus
(xiv)
any amount related to items that were added to or not deducted from Net Income in calculating
Consolidated Net Income or were added to or not deducted from Consolidated Net Income, in each case to the extent
such items represented a cash payment which had not reduced Excess Cash Flow upon the accrual thereof in a prior
Test Period, or an accrual for a cash payment, by the Borrower and its Restricted Subsidiaries or did not represent cash
received by the Borrower and its Restricted Subsidiaries, in each case on a consolidated basis during such Test Period;
provided that, at the option of the Borrower, any item that meets the criteria of any sub-clause of this clause (b) after the end of the applicable
period and prior to the applicable date of calculation of Excess Cash Flow for such period may, at the Borrower’s option, be included in the
applicable period, but not in any calculation pursuant to this clause (b) for the subsequent calculation period if such election is made.
“Exchange Act” means the Securities Exchange Act of 1934, as amended.
“Exchange Rate” means, on any date with respect to any currency, the rate at which such currency may be exchanged into any
other currency, as set forth at approximately 11:00 a.m., London time, on such date on the applicable Bloomberg page for such currency. In
the event that such rate does not appear on any Bloomberg page, the Exchange Rate shall be determined by reference to such other publicly
available service for displaying the exchange rates as may be selected by the Administrative Agent, or, in the event no such service is
selected, such Exchange Rate shall instead be the arithmetic average of the spot rates of exchange of the Administrative Agent in the market
where its foreign currency exchange operations in respect of such currency are then being conducted, at or about 10:00 a.m., local time, on
such date for the purchase of the relevant currency for delivery two Business Days later; provided that, if at the time of any such
determination, for any reason no such spot rate is being quoted, the Administrative Agent, after consultation with the Borrower, may use any
reasonable method that it deems appropriate to determine such rate, and such determination shall be presumed correct absent manifest error.
37
“Excluded Asset” has the meaning specified in the Security Agreement.
“Excluded Equity Interests” has the meaning specified in the Security Agreement.
“Excluded Subsidiary” means:
(a)
(b)
Subsidiary;
(c)
(d)
any Subsidiary that is not a wholly owned Subsidiary of a Loan Party;
any Foreign Subsidiary of the Borrower or of any direct or indirect Domestic Subsidiary or Foreign
any FSHCO;
any Domestic Subsidiary that is a direct or indirect Subsidiary of a Foreign Subsidiary that is a CFC;
(e)
any Subsidiary that is prohibited or restricted by applicable Law from providing a Guaranty or by a binding
contractual obligation existing on the Closing Date or at the time of the acquisition of such Subsidiary (and not incurred in
contemplation of such acquisition) from providing a Guaranty (provided that such contractual obligation is not entered into by the
Borrower or its Restricted Subsidiaries principally for the purpose of qualifying as an “Excluded Subsidiary” under this
definition) or if such Guaranty would require governmental (including regulatory) or third party (other than Holdings, the
Borrower or a Restricted Subsidiary) consent, approval, license or authorization, unless such consent, approval, license or
authorization has been obtained;
(f)
any special purpose securitization vehicle (or similar entity) including any Securitization Subsidiary created
pursuant to a transaction permitted under this Agreement;
(g)
(h)
any Subsidiary that is a not-for-profit organization;
any Captive Insurance Subsidiary;
(i)
any other Subsidiary with respect to which, as reasonably determined by the Borrower in good faith and in
consultation with the Administrative Agent, the cost or other consequences (including any material adverse tax consequences) of
providing the Guaranty shall be excessive in view of the benefits to be obtained by the Lenders therefrom;
(j)
any other Subsidiary to the extent the provision of a Guaranty by such Subsidiary would result in material
adverse tax consequences to Holdings (or any Parent Entity to the extent such material adverse tax consequences are related to its
ownership of the Equity Interests in Holdings or the Borrower and its Restricted Subsidiaries), the Borrower or any of the
Restricted Subsidiaries as reasonably determined by the Borrower in good faith in consultation with the Administrative Agent;
(k)
(l)
any Unrestricted Subsidiary; and
any Immaterial Subsidiary;
provided that the Borrower, in its sole discretion, may cause any Restricted Subsidiary that is a Domestic Subsidiary or a Canadian
Subsidiary (or any other Restricted Subsidiary, with the reasonably consent of the Administrative Agent) that qualifies as an Excluded
Subsidiary under clauses ((a)) through ((l)) above to
38
become a Guarantor in accordance with the definition thereof (subject to completion of any requested “know your customer” and similar
requirements of the Administrative Agent) and thereafter such Subsidiary shall not constitute an “Excluded Subsidiary” (unless and until the
Borrower elects, in its sole discretion, to designate such Persons as an Excluded Subsidiary).
“Excluded Swap Obligation” means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a
portion of the Guaranty of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any
Guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures
Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to
constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to any keepwell,
support or other agreement for the benefit of such Guarantor and any and all guarantees of such Guarantor’s Swap Obligations by other Loan
Parties) at the time the Guaranty of such Guarantor, or a grant by such Guarantor of a security interest, becomes effective with respect to such
Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to
the portion of such Swap Obligation that is attributable to swaps for which such Guaranty or security interest is or becomes excluded in
accordance with the first sentence of this definition.
“Excluded Taxes” has the meaning specified in Section 3.01(a).
“Existing Credit Documents” means (1) that certain Third Amended and Restated Credit Agreement, dated as of August 22,
2018, by and among Domtar Corporation, Domtar Inc., Domtar Pulp and Paper General Partnership, the additional borrowers from time to
time parties thereto, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the other agents
named therein (as amended, amended and restated, supplemented, restructured or otherwise modified, renewed or replaced from time to time)
and (2) that certain receivables securitization facility provided under (i) that certain Third Amended and Restated Receivables Transfer
Agreement, dated as of February 12, 2016, by and among Domtar Funding Limited Liability Company, Domtar Corporation, Liberty Street
Funding LLC and The Bank of Nova Scotia, (ii) that certain Amended and Restated Purchase and Sale Agreement, dated as of November 14,
2011, by and among the originators as named therein, Domtar Funding Limited Liability Company and Domtar Corporation and (iii) that
certain Performance Guaranty, dated as of March 7, 2007, by and among Domtar Corporation, Liberty Street Funding LLC and The Bank of
Nova Scotia and (as amended, amended and restated, supplemented, restructured or otherwise modified, renewed or replaced from time to
time).
“Existing Earnouts and Unfunded Holdbacks” shall mean those earnouts and unfunded holdbacks existing on the Closing Date.
“Existing Indebtedness” has the meaning specified in the Recitals.
“Existing Notes” means all senior notes issued and outstanding under that certain Indenture (together with each supplemental
indenture entered into thereunder), dated as of November 19, 2007, among Domtar Corporation, the subsidiary guarantors party thereto and
The Bank of New York Bellow (as successor to The Bank of New York), as tustee.
“Extended Loans” means Extended Term Loans.
“Extended Term Commitments” means the Term Loan Commitments held by an Extending Lender.
39
“Extended Term Loans” means the Term Loans made pursuant to Extended Term Commitments.
“Extending Lender” means each Lender accepting an Extension Offer.
“Extension” has the meaning specified in Section 2.15(a).
“Extension Amendment” has the meaning specified in Section 2.15(b).
“Extension Offer” has the meaning specified in Section 2.15(a).
“Facility” means the Term Loans made by the Lenders to the Borrower pursuant to Section 2.01(a) (including the Initial Term
Loans and the Delayed Draw Term Loans, which shall constitute a single Facility hereunder), the Delayed Draw Commitments, any
Extended Term Loans any Incremental Term Loans, or any 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 version
that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations
thereof, any agreements entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices
adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities implementing such Sections of
the Code.
“FCA” has the meaning specified in Section 10.01(f).
“FCPA” means the United States Foreign Corrupt Practices Act of 1977, as amended or modified from time to time.
“Federal Funds Rate” means, for any day, the rate calculated by the Federal Reserve Bank of New York based on such day’s
federal funds transactions by depository institutions (as determined in such manner as the Federal Reserve Bank of New York shall set forth
on its public website from time to time) and published on the next succeeding Business Day by the Federal Reserve Bank of New York as the
federal funds effective rate; provided that if the Federal Funds Rate for any day is less than zero, the Federal Funds Rate for such day will be
deemed to be zero.
“Financial Covenant” has the meaning specified in Section 8.01(e).
“First Lien Net Leverage Ratio” means, with respect to any Test Period, the ratio of (a) Consolidated Secured Net Debt under (i)
this Agreement, (ii) the Senior Secured Notes, (iii) any Pari Passu Lien Debt, (iv) the ABL Credit Facility and (v) Indebtedness secured on a
pari passu basis with the ABL Credit Facility on the ABL Priority Collateral, in each case, outstanding as of the last day of such Test Period
to (b) Consolidated Adjusted EBITDA of the Borrower for such Test Period.
“Fitch” means Fitch Ratings, Inc., and any successor thereto.
“Fixed Incremental Amount” means, as of the date of measurement, the sum of:
(a)
the greater of (i) 50% of Closing Date EBITDA and (ii) 50% of TTM Consolidated Adjusted EBITDA as of
the applicable date of determination; plus
(b)
the aggregate principal amount of any voluntary prepayments, redemptions and repurchases (including
amounts paid pursuant to “yank-a-bank” provisions with credit given to the
40
amount actually paid in cash, if acquired below par) of (1) Term Loans (including funded Delayed Draw Term Loans), (2) the
Senior Secured Notes, (3) other Pari Passu Lien Debt, (4) the ABL Credit Facility or (5) Indebtedness secured on a pari passu
basis with the ABL Credit Facility on the ABL Priority Collateral, in each case except to the extent such prepayments were funded
with the proceeds of long-term Indebtedness of the Borrower or its Restricted Subsidiaries (and in the case of any revolving
commitments, as long as there is a permanent reduction in such commitments); minus
(c)
without duplication of any amounts incurred in reliance on this definition, the aggregate amount of any
Incremental Equivalent Debt incurred and then outstanding in reliance on the Fixed Incremental Amount.
“Floor” means the benchmark rate floor, if any, provided in this Agreement initially (as of the execution of this Agreement, the
modification, amendment or renewal of this Agreement or otherwise) with respect to USD LIBOR.
“Foreign Casualty Event” has the meaning specified in Section 2.04(b)(v)(A).
“Foreign Disposition” has the meaning specified in Section 2.04(b)(v)(A).
“Foreign Lender” has the meaning specified in Section 3.01(b).
“Foreign Plan” means any material employee benefit plan, program or agreement maintained or contributed to by, or entered into
with, Holdings or any Restricted Subsidiary of Holdings with respect to employees employed outside the United States (other than benefit
plans, programs or agreements that are mandated by applicable Laws).
“Foreign Subsidiary” means any direct or indirect Subsidiary of the Borrower that is not a Domestic Subsidiary.
“FRB” means the Board of Governors of the Federal Reserve System of the United States.
“Fronted Delayed Draw Term Loans” has the meaning specified in Section 2.01(b)(vi).
“FSHCO” means any direct or indirect Domestic Subsidiary of Holdings (other than the Borrower) that has no material assets
other than Equity Interests (or Equity Interests and Indebtedness) in one or more Foreign Subsidiaries that are CFCs or other FSHCOs.
“Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or otherwise investing in
commercial loans and similar extensions of credit in the ordinary course.
“Funded Debt” means all Indebtedness of the Borrower and the Restricted Subsidiaries for borrowed money that matures more
than one year from the date of its creation or matures within one year from such date that is renewable or extendable, at the option of such
Person, to a date more than one year from such date or arises under a revolving credit or similar agreement that obligates the lender or lenders
to extend credit during a period of more than one year from such date, including Indebtedness in respect of the Loans.
“GAAP” means generally accepted accounting principles in the United States, as in effect from time to time; provided however
that if the Borrower notifies the Administrative Agent that the Borrower requests an amendment to any provision of a Loan Document to
eliminate the effect of any change occurring
41
after the Closing Date in GAAP or in the application thereof (including through the adoption of IFRS) on the operation of such provision (or
if the Administrative Agent notifies the Borrower that the Required Lenders request an amendment to any provision hereof for such purpose),
regardless of whether any such notice is given before or after such change in GAAP or in the application thereof (including through the
adoption of IFRS), then such provision shall be interpreted on the basis of GAAP as in effect and applied immediately before such change
shall have become effective until such notice shall have been withdrawn or such provision amended in accordance herewith.
“General Asset Sale Basket” has the meaning specified in Section 7.05(j).
“Global Intercompany Note” means a promissory note substantially in the form of Exhibit H executed by Holdings, the
Borrower and each wholly owned Restricted Subsidiary.
“Governmental Authority” means the government of the United States or any other nation, or of any political subdivision
thereof, whether state, municipal or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including
any supra-national bodies such as the European Union or the European Central Bank).
“Grant Event” means the occurrence of any of the following:
(a)
Subsidiary);
the formation or acquisition by a Loan Party of a new wholly owned Subsidiary (other than an Excluded
(b)
the designation in accordance with Section 6.13 of a wholly owned Subsidiary (other than an Excluded
Subsidiary) of any Loan Party as a Restricted Subsidiary;
(c)
(d)
any Person (other than an Excluded Subsidiary) becoming a wholly owned Subsidiary of a Loan Party;
any wholly owned Restricted Subsidiary of a Loan Party ceasing to be an Excluded Subsidiary; or
(e)
“Excluded Subsidiary”.
the designation of any Restricted Subsidiary as a Guarantor pursuant to the proviso in the definition of
“Granting Lender” has the meaning specified in Section 10.07(g).
“Guarantee” means, as to any Person, without duplication, (a) any obligation, contingent or otherwise, of such Person
guaranteeing or having the economic effect of guaranteeing any Indebtedness or other monetary obligation payable or performable by
another Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other monetary obligation,
(ii) to purchase or lease property, securities or services for the purpose of assuring the obligee in respect of such Indebtedness or other
monetary obligation of the payment or performance of such Indebtedness or other monetary obligation, (iii) to maintain working capital,
equity capital or any other financial statement condition or liquidity or level of income or cash flow of the primary obligor so as to enable the
primary obligor to pay such Indebtedness or other monetary obligation, or (iv) entered into for the purpose of assuring in any other manner
the obligee in respect of such Indebtedness or other monetary obligation of the payment or performance thereof or to protect such obligee
against loss in respect thereof (in whole or in part), or (b) any Lien (other than a Permitted Lien) on any assets of such Person securing
42
any Indebtedness or other monetary obligation of any other Person, whether or not such Indebtedness or other monetary obligation is
assumed by such Person (or any right, contingent or otherwise, of any holder of such Indebtedness to obtain any such Lien); provided that the
term “Guarantee” shall not include endorsements for collection or deposit, in either case in the ordinary course of business or customary,
Permitted Liens, and reasonable indemnity obligations in effect on the Closing Date or entered into in connection with any acquisition or
disposition of assets permitted under this Agreement (other than such obligations with respect to Indebtedness). The amount of any
Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof,
in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof
as determined by the guaranteeing Person in good faith. The term “Guarantee” as a verb has a corresponding meaning.
“Guarantors” means Holdings and each Restricted Subsidiary that executed a counterpart to the Guaranty (or a joinder thereto)
on the Closing Date or thereafter pursuant to Section 6.11, in each case, other than any Excluded Subsidiaries.
“Guaranty” means (a) the guaranty made by Holdings and the other Guarantors in favor of the Administrative Agent on behalf of
the Secured Parties substantially in the form of Exhibit E and (b) each other guaranty and guaranty supplement delivered pursuant to
Section 6.11.
“Guaranty Release Event” has the meaning specified in Section 9.11(a)(i)(I).
“Guaranty Supplement” means the “First Lien Guarantee Supplement” as defined in the Guaranty.
“Hazardous Materials” means any hazardous or toxic chemicals, materials, substances or waste which is listed, classified or
regulated by any Governmental Authority as “hazardous substances,” “hazardous wastes,” “hazardous materials,” “extremely hazardous
wastes,” “restricted hazardous wastes,” “toxic substances,” “toxic wastes,” “contaminants” or “pollutants,” or words of similar import, under
any Environmental Law, including petroleum or petroleum products (including gasoline, crude oil or any fraction thereof), asbestos or
asbestos-containing materials, polychlorinated biphenyls, radon gas and urea formaldehyde.
“Hedge Agreement” means any agreement with respect to (a) any and all rate swap transactions, basis swaps, credit derivative
transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or forward bond price or forward bond index transactions,
interest rate options, forward foreign exchange transactions, cap transactions, floor transactions, collar transactions, currency swap
transactions, cross-currency rate swap transactions, currency options, spot contracts, or any other similar transactions or any combination of
any of the foregoing (including any options to enter into any of the foregoing), whether or not any such transaction is governed by or subject
to any master agreement, and (b) any and all transactions of any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the International Swaps and Derivatives Association, Inc., any
International Foreign Exchange Master Agreement, or any other master agreement (any such master agreement, together with any related
schedules, a “Master Agreement”), including any such obligations or liabilities under any Master Agreement.
“Hedge Bank” means any Person that is an Agent, a Lender, a Lead Arranger or an Affiliate or branch of any of the foregoing on
the Closing Date (with respect to any Secured Hedge Agreement entered into on or prior to the Closing Date) or at the time it enters into a
Secured Hedge Agreement, in its capacity as a party thereto, whether or not such Person subsequently ceases to be an Agent, a Lender, a
Lead Arranger
43
or an Affiliate or branch of any of the foregoing or (ii) any other Person reasonably acceptable to the Administrative Agent designated by the
Borrower to the Administrative Agent in writing and so long as such Person (a) agrees to appoint the Administrative Agent as its agent under
the applicable Loan Documents and (b) agrees to be bound by the provisions of the applicable Loan Documents as a Hedge Bank.
“HMT” means Her Majesty’s Treasury of the United Kingdom.
“Holdings” has the meaning specified in the preliminary statements to this Agreement, together with its successors and assigns
permitted hereunder.
“IBA” has the meaning specified in Section 10.01(f).
“ICE LIBOR” means the London Interbank Offered Rate set by ICE Benchmark Administration Limited.
“Identified Transaction” has the meaning specified in Section 9.11(b).
“IFRS” means International Financial Reporting Standards and applicable accounting requirements set by the International
Accounting Standards Board or any successor thereto (or the Financial Accounting Standards Board, the Accounting Principles Board of the
American Institute of Certified Public Accountants, or any successor to either such Board, or the SEC, as the case may be), as in effect from
time to time.
“Immaterial Subsidiary” means any Restricted Subsidiary of the Borrower other than a Material Subsidiary.
“Increased Amount” means, in the case of any Indebtedness, any increase in the amount of such Indebtedness in connection with
any accrual of interest, the accretion of accreted value, the amortization of original issue discount or deferred financing fees, the payment of
interest or dividends in the form of additional Indebtedness or in the form of Equity Interests, as applicable, the accretion of original issue
discount, deferred financing fees or liquidation preference and increases in the amount of Indebtedness outstanding solely as a result of
fluctuations in the exchange rate of currencies.
“Incremental Amendment” has the meaning specified in Section 2.13(e).
“Incremental Amount” has the meaning specified in Section 2.13(c).
“Incremental Equivalent Debt” means Indebtedness; provided that at the time of incurrence thereof:
(a)
the aggregate principal amount of all Incremental Equivalent Debt on any date such Indebtedness is incurred
(or commitments with respect thereto are made) shall not, together with any Incremental Term Facilities then outstanding, exceed
the Incremental Amount;
(b)
any Incremental Equivalent Debt (i) that is Pari Passu Lien Debt incurred as term facilities shall not mature
prior to the Latest Maturity Date of, and shall not have a Weighted Average Life to Maturity shorter than the remaining Weighted
Average Life to Maturity of, the Initial Term Loans, or (ii) that is Junior Lien Debt or Indebtedness that is not secured by a Lien on
any Collateral and incurred as term facilities shall not mature, or have scheduled amortization, prior to the date that is 91 days
following the Latest Maturity Date of the Initial Term Loans; provided
44
that this clause (b) shall not apply to the incurrence of any such Indebtedness pursuant to the Inside Maturity Exception;
(c)
except for Indebtedness incurred pursuant to the Inside Maturity Exception, any mandatory prepayments of
any Incremental Equivalent Debt:
(i)
that is Pari Passu Lien Debt shall be made on a pro rata basis or less than pro rata basis with any
corresponding mandatory prepayment of the Loans, the Senior Secured Notes and any other Pari Passu Lien Debt (but
not on a greater than pro rata basis, except for (A) any repayment of such Incremental Equivalent Debt at maturity and
(B) any greater than pro rata repayment of such Incremental Equivalent Debt with the proceeds of a refinancing
thereof); and
(ii)
that comprises Junior Lien Debt or Indebtedness that is not secured by a Lien on all or any portion
of the Collateral may not be made unless, to the extent required hereunder, such prepayments are first made or offered
to the Loans, the Senior Secured Notes and any other Pari Passu Lien Debt on a pro rata basis.
if such Incremental Equivalent Debt is in the form of term loans denominated in Dollars and is Pari Passu
Lien Debt, then the provisions of Section 2.13(h) shall apply as if such Incremental Equivalent Debt was Incremental Term Loans;
(d)
(e)
(i) to the extent secured by the assets of any Loan Party, such Incremental Equivalent Debt shall not be
secured by any Lien on any property or asset of any Loan Party that does not also secure the Initial Term Loans at the time of such
incurrence (except (1) customary cash collateral in favor of an agent, letter of credit issuer or similar “fronting” lender, (2) Liens
on property or assets applicable only to periods after the Latest Maturity Date of the Initial Term Loans at the time of incurrence,
(3) Liens on the proceeds of such Incremental Equivalent Debt funded into escrow pursuant to customary escrow arrangements
and (4) any Liens on property or assets to the extent that a Lien on such property or asset is also added for the benefit of the
Lenders under the Term Loans) and (ii) to the extent incurred or guaranteed by any Loan Party, such Incremental Equivalent Debt
shall not be incurred or guaranteed by any Loan Party other than the Borrower and the Guarantors (including any Person required
to be a Guarantor) (except (1) for guarantees by other Persons that are applicable only to periods after the Latest Maturity Date of
the Term Loans at the time of incurrence and (2) any such Person incurring or guaranteeing such Incremental Term Facilities that
also guarantees the Term Loans); and
(f)
the aggregate principal amount of Incremental Equivalent Debt incurred by Non-Loan Parties, together with
the aggregate principal amount of Permitted Ratio Debt incurred by Non-Loan Parties, shall not exceed, in the aggregate, the
greater of (i) 100.00% of Closing Date EBITDA and (ii) 100.00% of TTM Consolidated Adjusted EBITDA as of the applicable
date of determination.
Incremental Equivalent Debt will be deemed to include any Registered Equivalent Notes issued in exchange therefor.
“Incremental Facility” has the meaning specified in Section 2.13(a).
“Incremental Loans” has the meaning specified in Section 2.13(a).
“Incremental Term Facilities” has the meaning specified in Section 2.13(a).
45
“Incremental Term Loan Commitment” means the commitment of a Lender to make or otherwise fund an Incremental Term
Loan and “Incremental Term Loan Commitments” means such commitments of all Lenders in the aggregate.
“Incremental Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding
principal amount of the Incremental Term Loans of such Lenders; provided, at any time prior to the making of the Incremental Term Loans,
the Incremental Term Loan Exposure of any Lender shall be equal to such Lender’s Incremental Term Loan Commitment.
“Incremental Term Loans” has the meaning specified in Section 2.13(a).
“Indebtedness” means, with respect to any Person, without duplication,
(a)
any indebtedness (including principal or premium) of such Person in respect of borrowed money; any
indebtedness evidenced by bonds, notes, debentures, loan agreements or similar instruments; letters of credit or bankers’
acceptances (or, without double counting, reimbursement agreements in respect thereof), and Capitalized Lease Obligations or the
balance deferred and unpaid of the purchase price of any property to the extent that the same would be required to be shown as a
long-term liability on the balance sheet for such Person prepared in accordance with GAAP;
(b)
(i) to the extent not otherwise included, any guarantee obligation by such Person of the obligations of the
type referred to in clause (a) of another Person (whether or not such items would appear upon the balance sheet of such obligor or
guarantor), other than by endorsement of negotiable instruments for collection in the ordinary course of business and (ii) to the
extent not otherwise included, the obligations of the type referred to in clause (a) of another Person secured by a Lien (other than a
Permitted Lien) on any property owned by such Person, whether or not such obligations are assumed by such Person and whether
or not such obligations would appear upon the balance sheet of such Person; provided that the amount of such Indebtedness for
purposes of this clause (ii) will be the lesser of the fair market value of such property at such date of determination and the amount
of Indebtedness so secured;
(c)
net obligations of such Person under any Hedge Agreement to the extent such obligations would appear as a
net liability on a balance sheet of such Person (other than in the footnotes) prepared in accordance with GAAP; and
(d)
all obligations of such Person in respect of Disqualified Equity Interests;
provided that, notwithstanding the foregoing, Indebtedness will be deemed not to include (1) contingent obligations incurred in the ordinary
course of business unless and until such obligations are non-contingent, (2) trade payables, (3) earn-outs, purchase price holdbacks or similar
obligations, (4) intercompany liabilities in the ordinary course of business, (5) Permitted Liens, (6) Indebtedness of any direct or indirect
parent company appearing on the balance sheet of such Person solely by reason of push down accounting under GAAP and (7) lease
obligations other than in respect of a Capitalized Lease. The amount of any net obligation under any Hedge Agreement on any date shall be
deemed to be the Swap Termination Value thereof as of such date.
“Indemnified Liabilities” has the meaning specified in Section 10.05.
“Indemnitees” has the meaning specified in Section 10.05.
46
“Independent Financial Advisor” means an accounting, appraisal, investment banking firm or consultant of nationally
recognized standing that is, in the good faith judgment of the Borrower, qualified to perform the task for which it has been engaged and that
is independent of the Borrower and its Affiliates.
“Information” has the meaning specified in Section 10.08.
“Initial Borrower” has the meaning specified in the introductory paragraph to this Agreement.
“Initial Term Loan Commitment” means, as to each Lender, its obligation to make an Initial Term Loan (other than a Delayed
Draw Term Loan) to the Borrower hereunder on the Closing Date, expressed as an amount representing the maximum principal amount of
the Initial Term Loans to be made by such Lender under this Agreement, as such commitment may be (a) reduced from time to time pursuant
to Section 2.05 and (b) reduced or increased from time to time pursuant to (i) assignments by or to such Lender pursuant to an Assignment
and Assumption, (ii) a Refinancing Amendment or (iii) an Extension. The initial amount of each Lender’s Initial Term Loan Commitment is
set forth on Schedule 2.01 under the caption “Initial Term Loan Commitment” or, otherwise, in the Assignment and Assumption or
Refinancing Amendment pursuant to which such Lender shall have assumed its Initial Term Loan Commitment, as the case may be. The
aggregate amount of the Initial Term Loan Commitments is $525,000,000.
“Initial Term Loans” has the meaning assigned to such term in Section 2.01(a).
“Inside Maturity Exception” means Indebtedness consisting of, at the Borrower’s option, any combination of Incremental
Facilities, Incremental Equivalent Debt, Permitted Ratio Debt, Credit Agreement Refinancing Debt and any Permitted Refinancing of the
foregoing, in each case, that is in an aggregate principal amount not to exceed the greater of (i) 50% of Closing Date EBITDA and (ii) 50%
of TTM Consolidated Adjusted EBITDA as of the applicable date of determination.
“Intellectual Property” has the meaning specified in the Security Agreement.
“Intellectual Property Security Agreements” has the meaning specified in the Security Agreement.
“Intercreditor Agreements” means the Closing Date ABL Intercreditor Agreement, any Junior Lien Intercreditor Agreement, the
Closing Date Equal Priority Intercreditor Agreement, any other Equal Priority Intercreditor Agreement and any other intercreditor agreement
reasonably acceptable to the Borrower governing lien priority, in each case that may be executed by the Collateral Agent in accordance with
Section 9.11(a)(v) from time to time pursuant to the terms hereof.
“Interest Payment Date” means, (a) as to any Eurocurrency Rate Loan, the last day of each Interest Period applicable to such
Eurocurrency Rate Loan and the applicable Maturity Date; provided that if any Interest Period for a Eurocurrency Rate Loan exceeds three
months, the respective dates that fall every three months after the beginning of such Interest Period shall also be Interest Payment Dates,
(b) as to any Base Rate Loan the first Business Day of each fiscal quarter and the applicable Maturity Date and (c) to the extent necessary to
create a fungible tranche of Term Loans, the date of the incurrence of any Delayed Draw Term Loans or Incremental Term Loans.
“Interest Period” means, as to each Eurocurrency Rate Loan, the period commencing on the date such Eurocurrency Rate Loan is
disbursed or converted to or continued as a Eurocurrency Rate Loan and ending on the date one, two (ony to the extent such Interest Period
would end on or prior to December 31, 2021), three or six months thereafter, or to the extent consented to by each applicable Lender, twelve
months
47
(or such period of less than one month as may be consented to by each applicable Lender), as selected by the Borrower in its Committed
Loan Notice; provided that:
(a)
any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next
succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end
on the immediately preceding Business Day;
(b)
any Interest Period (other than an Interest Period having a duration of less than one month) that begins on the
last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at
the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and
(c)
no Interest Period shall extend beyond the applicable Maturity Date.
“Investment” means, as to any Person, any direct or indirect acquisition or investment by such Person, by means of
(a)
the purchase or other acquisition (including by merger, amalgamation or otherwise) 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, another Person, including any partnership or joint venture
interest in such other Person, but excluding any Short Term Advances; or
(c)
the purchase or other acquisition (in one transaction or a series of transactions, including by merger,
amalgamation or otherwise) 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 another Person;
provided that none of the following shall constitute an Investment (i) intercompany advances between and among the Borrower and its
Restricted Subsidiaries relating to their cash management, tax and accounting operations in the ordinary course of business and
(ii) intercompany loans, advances or Indebtedness between and among the Borrower and its Restricted Subsidiaries having a term not
exceeding 364 days and made in the ordinary course of business.
“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the
equivalent) by S&P, or an equivalent rating by any other nationally recognized statistical rating agency selected by the Borrower.
“IRS” means Internal Revenue Service of the United States.
“Jackson Wijaya” means (a) Jackson Wijaya, (b) family members of Jackson Wijaya, (c) trusts, partnerships or limited liability
companies for the benefit of any of the individuals identified in the foregoing clause (a) or (b), and (d) heirs, executors, estates, successors
and legal representatives of the individuals identified in the foregoing clause (a) or (b).
“Joint Bookrunners” means Barclays PLC, BMO Capital Markets Corp., Credit Suisse Loan Funding LLC and Wells Fargo
Securities, LLC.
48
“Joint Venture” means (a) any Person which would constitute an “equity method investee” of the Borrower or any of the
Restricted Subsidiaries and (b) any Person in whom the Borrower or any of the Restricted Subsidiaries beneficially owns any Equity Interest
that is not a Restricted Subsidiary.
“Joint Venture Investments” means Investments in any Joint Venture or Unrestricted Subsidiary in an aggregate amount not to
exceed the greater of (a) 10.00% of Closing Date EBITDA and (b) 10.00% of TTM Consolidated Adjusted EBITDA as of the applicable date
of determination provided that, in the case of any Investment in an Unrestricted Subsidiary, no Specified Event of Default has occurred or is
continuing or would result therefrom.
“Judgment Currency” has the meaning specified in Section 2.17(b).
“Junior Debt Repayment” has the meaning specified in Section 7.09(a).
“Junior Financing” means any Material Indebtedness (i) that is contractually subordinated in right of payment to the Obligations
expressly by its terms (ii) constitutes Junior Lien Debt or (ii) any Incremental Loans, any Incremental Equivalent Debt or any Permitted Ratio
Debt, in each case consisting of unsecured Indebtedness of a Loan Party.
“Junior Financing Documentation” means any documentation governing any Junior Financing.
“Junior Lien Debt” means any Indebtedness that is intended by the Borrower to be secured by a Lien on all or any portion of the
Collateral that has a priority that is contractually (or otherwise) junior in priority to the Lien on such Collateral that secure the Obligations
(other than the ABL Obligations and Indebtedness secured on a pai passu basis with the ABL Credit Facility on the ABL Priority Collateral).
“Junior Lien Intercreditor Agreement” means an intercreditor agreement, substantially in the form attached hereto as Exhibit K
(as the same may be modified in a manner reasonably satisfactory to the Administrative Agent, the Collateral Agent and the Borrower), or, if
requested by the providers of Indebtedness permitted hereunder to be Junior Lien Debt, another lien subordination arrangement reasonably
satisfactory to the Administrative Agent, the Collateral Agent and the Borrower, in each case as amended, restated, amended and restated,
modified or supplemented from time to time in accordance with the terms hereof and thereof. Upon the request of the Borrower, the
Administrative Agent and the Collateral Agent will execute and deliver a Junior Lien Intercreditor Agreement with one or more Debt
Representatives for secured Indebtedness that is permitted to be incurred hereunder as Junior Lien Debt.
“Latest Maturity Date” means, at any date of determination, the latest maturity or expiration date applicable to any Loan or
Commitment hereunder at such time, including the latest maturity or expiration date of any Incremental Loan, any Refinancing Term Loan,
any Extended Term Loan, in each case as extended in accordance with this Agreement from time to time.
“Laws” means, collectively, all international, foreign, federal, state, municipal and local statutes, treaties, rules, guidelines,
regulations, ordinances, codes and administrative or judicial precedents or authorities and executive orders, including the interpretation or
administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all
applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental
Authority.
“LCA Election” has the meaning specified in Section 1.08(f).
“LCA Test Date” has the meaning specified in Section 1.08(f).
49
“Lead Arrangers” means Barclays PLC, BMO Capital Markets Corp., Credit Suisse Loan Funding LLC and Wells Fargo
Securities, LLC.
“Lender” has the meaning specified in the introductory paragraph to this Agreement (and, for the avoidance of doubt, includes
each Term Loan Lender), and their respective successors and assigns as permitted hereunder, each of which is referred to herein as a
“Lender.” Each Additional Lender shall be a Lender to the extent any such Person has executed and delivered a Refinancing Amendment or
an Incremental Amendment, as the case may be, and to the extent such Refinancing Amendment or Incremental Amendment shall have
become effective in accordance with the terms hereof and thereof, and each Extending Lender shall continue to be a Lender. As of the
Closing Date, Schedule 2.01 sets forth the name of each Lender. Notwithstanding the foregoing, no Disqualified Lender that purports to
become a Lender hereunder (notwithstanding the provisions of this Agreement that prohibit Disqualified Lenders from becoming Lenders)
shall be entitled to any of the rights or privileges enjoyed by the other Lenders (including with respect to voting, information and lender
meetings) and shall be deemed for all purposes to be, at most, a Defaulting Lender (except for purposes of Section 2.16(b)) until such time as
such Disqualified Lender no longer owns any Loans or Commitments.
“Lending Office” means, as to any Lender, the office or offices of such Lender described as such in such Lender’s Administrative
Questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower and the Administrative Agent.
“Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory, deemed or
other), charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever (including any
conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real property, and any
Capitalized Lease having substantially the same economic effect as any of the foregoing); provided that in no event shall an operating lease in
and of itself be deemed a Lien.
“Lien Release Event” has the meaning specified in Section 9.11(a)(i).
“Limited Condition Acquisition” means any Acquisition Transaction or other Investment by the Borrower or one or more of its
Restricted Subsidiaries whose consummation is not conditioned on the availability of, or on obtaining, third party financing.
“Loan” means a Term Loan or a Delayed Draw Term Loan made by a Lender to the Borrower under a Loan Document.
“Loan Documents” means, collectively, (a) this Agreement, (b) the Notes, (c) any Refinancing Amendment, Incremental
Amendment or Extension Amendment, (d) the Guaranty, (e) the Collateral Documents, (f) the Intercreditor Agreements, and (g) the Global
Intercompany Note.
“Loan Parties” means, collectively, the Borrower and the Guarantors; provided that prior to the consummation of the Acquisition,
neither the Acquired Business nor any of its Subsidiaries shall be Loan Parties.
“Management Stockholders” means (a) any Company Person who is an investor in Holdings or a Parent Entity, (b) family
members of any of the individuals identified in the foregoing clause (a), (c) trusts, partnerships or limited liability companies for the benefit
of any of the individuals identified in the foregoing clause (a) or (b), and (d) heirs, executors, estates, successors and legal representatives of
the individuals identified in the foregoing clause (a) or (b).
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“Margin Stock” has the meaning set forth in Regulation U of the Board of Governors of the United States Federal Reserve
System, or any successor thereto.
“Master Agreement” has the meaning specified in the definition of “Hedge Agreement.”
“Material Adverse Effect” means any event, circumstance or condition that has had a materially adverse effect on (a) the
business, operations, assets, liabilities (actual or contingent) or financial condition of the Borrower and its Restricted Subsidiaries, taken as a
whole, and (b) the ability of the Loan Parties (taken as a whole) to perform their respective payment obligations under the Loan Documents.
“Material Domestic Subsidiary” means, as of the Closing Date and thereafter at any date of determination, each of the
Borrower’s Domestic Subsidiaries that are Restricted Subsidiaries, (a) whose total assets (other than intercompany investments) at the last
day of the most recent Test Period (when taken together with the total assets (other than intercompany investments) of the Restricted
Subsidiaries of such Domestic Subsidiary at the last day of the most recent Test Period) were equal to or greater than 5.0% of the
consolidated total assets of the Borrower and the Restricted Subsidiaries as of the last day of such Test Period, in each case determined in
accordance with GAAP or (b) whose revenues for such Test Period (when taken together with the revenues of the Restricted Subsidiaries of
such Domestic Subsidiary for such Test Period) were equal to or greater than 5.0% of the consolidated revenues of the Borrower and the
Restricted Subsidiaries for such Test Period, in each case determined in accordance with GAAP; provided that if, at any time and from time
to time after the date which is 30 days after the Closing Date (or such longer period as the Administrative Agent may agree in its sole
discretion), Domestic Subsidiaries that are not Guarantors solely because they do not meet the thresholds set forth in clause (a) or (b)
comprise in the aggregate more than (when taken together with the total assets (other than intercompany investments) of the Restricted
Subsidiaries of such Domestic Subsidiaries at the last day of the most recent Test Period) 10.0% of the total consolidated assets of the
Borrower and the Restricted Subsidiaries that are Domestic Subsidiaries as of the end of the most recently ended Test Period or more than
(when taken together with the revenues of the Restricted Subsidiaries of such Domestic Subsidiaries for such Test Period) 10.0% of the
consolidated revenues of the Borrower and the Restricted Subsidiaries that are Domestic Subsidiaries for such Test Period (or, in each case,
on any date when re-designated as an Excluded Subsidiary pursuant to the definition of “Excluded Subsidiary”), then the Borrower shall,
not later than sixty days after the date by which financial statements for such Test Period were required to be delivered pursuant to this
Agreement or on the date of such redesignation, as applicable (or, in each case, such longer period as the Administrative Agent may agree in
its reasonable discretion), (i) designate in writing to the Administrative Agent one or more of such Domestic Subsidiaries as “Material
Domestic Subsidiaries” to the extent required such that the foregoing condition ceases to be true and (ii) comply with the provisions of
Section 6.11 with respect to any such Subsidiaries.
“Material Foreign Subsidiary” means, as of the Closing Date and thereafter at any date of determination, each of the Borrower’s
Foreign Subsidiaries that are Restricted Subsidairies (a) whose total assets (other than intercompany investments) at the last day of the most
recent Test Period (when taken together with the total assets (other than intercompany investments) of the Restricted Subsidiaries of such
Foreign Subsidiary at the last day of the most recent Test Period) were equal to or greater than 5.0% of the consolidated total assets of the
Borrower and the Restricted Subsidiaries as of the last day of such Test Period, in each case determined in accordance with GAAP or
(b) whose revenues for such Test Period (when taken together with the revenues of the Restricted Subsidiaries of such Foreign Subsidiary for
such Test Period) were equal to or greater than 5.0% of the consolidated revenues of the Borrower and the Restricted Subsidiaries for such
Test Period, in each case determined in accordance with GAAP; provided that if, at any time and from time to time after the date which is
30 days after the Closing Date (or such longer period as the Administrative Agent may agree in its sole discretion), Foreign Subsidiaries that
are not Material Foreign Subsidiaries comprise in the aggregate more than (when taken together with the total
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assets (other than intercompany investments) of the Restricted Subsidiaries of such Foreign Subsidiaries at the last day of the most recent
Test Period) 10.0% of the total consolidated assets of the Borrower and the Restricted Subsidiaries that are Foreign Subsidiaries as of the end
of the most recently ended Test Period or more than (when taken together with the revenues of the Restricted Subsidiaries of such Foreign
Subsidiaries for such Test Period) 10.0% of the consolidated revenues of the Borrower and the Restricted Subsidiaries that are Foreign
Subsidiaries for such Test Period (or, in each case, on any date when re-designated as an Excluded Subsidiary pursuant to the definition of
“Excluded Subsidiary”), then the Borrower shall, not later than sixty days after the date by which financial statements for such Test Period
were required to be delivered pursuant to this Agreement or on the date of such re-designation (or, in each case, such longer period as the
Administrative Agent may agree in its reasonable discretion), designate in writing to the Administrative Agent one or more of such Foreign
Subsidiaries as “Material Foreign Subsidiaries” to the extent required such that the foregoing condition ceases to be true.
“Material Indebtedness” means, as of any date, Indebtedness for borrowed money on such date of any Loan Party in an
aggregate principal amount exceeding the Threshold Amount; provided that in no event shall any of the following be Material Indebtedness
(a) Indebtedness under a Loan Document, (b) obligations in respect of a Qualified Securitization Financing, (c) Capitalized Lease
Obligations, (d) Indebtedness held by a Loan Party or any Indebtedness held by an Affiliate of a Loan Party and (e) Indebtedness under
Hedge Agreements.
“Material Real Property” means any real property owned in fee by the Borrower or any Restricted Subsidiary that is a Loan
Party (or owned by any Person required to become a Loan Party hereunder) (i) as of the Closing Date, with a fair market value (as reasonably
estimated by the Borrower) in excess of $25,000,000 and (ii) as of the date the acquisition of such real property, with a fair market value (as
reasonably estimated by the Borrower) in excess of $25,000,000; provided, that Material Real Property shall not include any real property
located in an area identified by the Federal Emergency Management Agency (or any successor agency) as a “special flood hazard area”.
“Material Subsidiary” means any Material Domestic Subsidiary or any Material Foreign Subsidiary.
“Materiality Threshold Amount” means an amount equal to the greater of 5.00% of Closing Date EBITDA and 5.00% of TTM
Consolidated Adjusted EBITDA.
“Maturity Date” means:
(a)
with respect to the Initial Term Loans and any Delayed Draw Term Loans that have not been extended
pursuant to Section 2.15, the date that is the earlier of (i) seven years after the Closing Date and (ii) the date such Term Loans are
declared due and payable pursuant to Section 8.02
(b)
with respect to any tranche of Extended Term Loans , the earlier of (i) the final maturity date as specified in
the applicable Extension Amendment and (ii) the date such tranche of Extended Term Loans are terminated and/or declared due
and payable pursuant to Section 8.02;
(c)
with respect to any Refinancing Term Loans, the earlier of (i) the final maturity date as specified in the
applicable Refinancing Amendment and (ii) the date such Refinancing Term Loans are declared due and payable pursuant to
Section 8.02; and
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(d)
with respect to any Incremental Term Loans, the earlier of (i) the final maturity date as specified in the
applicable Incremental Amendment and (ii) the date such Incremental Term Loans are declared due and payable pursuant to
Section 8.02;
provided, in each case, that if such day is not a Business Day, the applicable Maturity Date shall be the Business Day immediately preceding
such day.
“Maximum Rate” has the meaning specified in Section 10.10.
“Merger” has the meaning specified in the preliminary statements.
“Merger Sub” has the meaning specified in the preliminary statements.
“Minimum Equity Contribution” has the meaning specified in the definition of “Equity Contribution”
“Minority Investment” means any Person other than a Subsidiary in which the Borrower or any Restricted Subsidiary owns any
Equity Interests.
“Model” means the financial model used in connection with the syndication of the Facility and the ABL Credit Facility.
“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.
“Mortgage Policy” and/or “Mortgage Policies” means an American Land Title Association Lender’s Extended Coverage title
insurance policy covering such interest in the Mortgaged Property in an amount at least equal to the fair market value of such Mortgaged
Property (or such lesser amount as may be specified by the Collateral Agent) insuring the first priority Lien of each such Mortgage as a valid
Lien on the property described therein, free of any other Liens except as permitted by Section 7.01, together with such endorsements,
coinsurance and reinsurance as the Collateral Agent may reasonably request and in form and substance reasonably satisfactory to the
Collateral Agent.
“Mortgaged Properties” means the property on which Mortgages are required pursuant to Sections 6.11 and 6.15.
“Mortgages” means, collectively, the deeds of trust, trust deeds, hypothecs and mortgages made by the Loan Parties in favor or
for the benefit of the Collateral Agent on behalf of the Secured Parties in form and substance reasonably satisfactory to the Collateral Agent,
and any other mortgages executed and delivered pursuant to Section 6.11 or 6.15.
“Multiemployer Plan” means any multiemployer plan as defined in Section 4001(a)(3) of ERISA and subject to Title IV of
ERISA, to which any Loan Party or any of their respective ERISA Affiliates makes or is obligated to make contributions, or during the
preceding five plan years, has made or been obligated to make contributions.
“Net Cash Proceeds” means, with respect to:
(a)
the Disposition of any asset by the Borrower or any Restricted Subsidiary or any Casualty Event, the excess,
if any, of:
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(i)
the sum of cash and Cash Equivalents received in connection with such Disposition or Casualty
Event (including any cash and Cash Equivalents received by way of deferred payment pursuant to, or by monetization
of, a note receivable or otherwise, but only as and when so received and, with respect to any Casualty Event, any
insurance proceeds or condemnation awards in respect of such Casualty Event actually received by or paid to or for the
account of the Borrower or any of the Restricted Subsidiaries), over
(ii)
the sum of,
(A)
the principal amount, premium or penalty, if any, interest, breakage costs and other
amounts on any Indebtedness that is secured by the asset subject to such Disposition or Casualty Event and
required to be repaid in connection with such Disposition or Casualty Event (other than Indebtedness under
the Loan Documents, Pari Passu Lien Debt or Junior Lien Debt),
(B)
the out-of-pocket fees and expenses (including attorneys’ fees, accountants’ fees,
investment banking fees, survey costs, title insurance premiums, and related search and re-cording charges,
transfer taxes, deed or mortgage recording taxes, other customary expenses and brokerage, consultant and
other customary fees) incurred by the Borrower or such Restricted Subsidiary in connection with such
Disposition or Casualty Event and restoration costs following a Casualty Event,
(C)
taxes or distributions made pursuant to Section 7.06(g)(i) or 7.06(g)(iii) paid or
reasonably estimated to be payable in connection therewith (including taxes imposed and/or other amounts
withheld on the distribution or repatriation of any such Net Cash Proceeds),
(D)
in the case of any Disposition or Casualty Event by a non-wholly owned Restricted
Subsidiary, the pro rata portion of the Net Cash Proceeds thereof (calculated without regard to this
clause ((D))) attributable to minority interests and not available for distribution to or for the account of the
Borrower or a wholly owned Restricted Subsidiary as a result thereof, and
(E)
any reserve for adjustment in respect of (1) the sale price of such asset or assets
established in accordance with GAAP and (2) any liabilities associated with such asset or assets and retained
by the Borrower or any Restricted Subsidiary after such sale or other disposition thereof, including pension
and other post-employment benefit liabilities and liabilities related to environmental matters or against any
indemnification obligations associated with such transaction, it being understood that “Net Cash Proceeds”
shall include the amount of any reversal (without the satisfaction of any applicable liabilities in cash in a
corresponding amount) of any reserve described in this clause ((E));
provided that (I) no net cash proceeds calculated in accordance with the foregoing realized in a single transaction or series of related
transactions shall constitute Net Cash Proceeds unless such amount exceeds 2.50% of Closing Date EBITDA and (II) no such net cash
proceeds shall constitute Net Cash Proceeds under this clause ((a)) in any fiscal year until the aggregate amount of all such net cash proceeds
in such fiscal year exceeds 5.00% of Closing Date EBITDA (and thereafter only net cash proceeds in excess of such amount shall constitute
Net Cash Proceeds under this clause ((a))); and
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(b)
the sale, incurrence or issuance of any Indebtedness by the Borrower or any Restricted Subsidiary, the
excess, if any, of:
over
(i)
the sum of the cash and Cash Equivalents received in connection with such incurrence or issuance
(ii)
taxes paid or reasonably estimated to be payable as a result thereof, fees (including investment
banking fees, attorneys’ fees, accountants’ fees, underwriting fees and discounts), commissions, costs and other out-of-
pocket expenses and other customary expenses, incurred by the Borrower or such Restricted Subsidiary in connection
with such sale, incurrence or issuance;
(c)
any Permitted Equity Issuance by any Parent Entity, the amount of cash and Cash Equivalents from such
Permitted Equity Issuance contributed to the capital of the Borrower.
“Net Income” means, with respect to any Person, the net income (loss) of such Person, determined in accordance with GAAP
(determined, for the avoidance of doubt, on an unconsolidated basis) and before any reduction in respect of preferred stock dividends.
“Net Short Lender” means at any date of determination, each Lender that has a Net Short Position as of such date; provided that,
for all purposes of this Agreement and the other Loan Documents, Unrestricted Lenders shall at all times be deemed to not be Net Short
Lenders.
“Net Short Position” means, with respect to a Lender (other than an Unrestricted Lender), as of a date of determination, the net
positive position, if any, held by such Lender that is remaining after deducting any long position that the Lender holds (i.e., a position
(whether as an investor, lender or holder of Loans, debt obligations and/or Derivative Instruments) where the Lender is exposed to the credit
risk of the Loan Parties) from any short positions (i.e., a position as described above, but where the Lender has a negative exposure to the
credit risk described above).
For purposes of determining whether a Lender (other than an Unrestricted Lender) has a Net Short Position on any date of
determination:
(a)
Derivative Instruments shall be counted at the notional amount (in Dollars) of such Derivative Instrument;
provided that, subject to clause (e) below, the notional amount of Derivative Instruments referencing an index that includes any of
the Loan Parties or any bond or loan obligation issued or guaranteed by any Loan Party shall be determined in proportionate
amount and by reference to the percentage weighting of the component which references any Loan Party or any bond or loan
obligation issued or guaranteed by any Loan Party that would be a “Deliverable Obligation” or an “Obligation” (as defined in
the ISDA CDS Definitions) of the Loan Parties;
(b)
notional amounts of Derivative Instruments in other currencies shall be converted to the Dollar equivalent
thereof by such Lender in accordance with the terms of such Derivative Instruments, as applicable; provided that if not otherwise
provided in such Derivative Instrument, such conversion shall be made in a commercially reasonable manner consistent with
generally accepted financial practices and based on the prevailing conversion rate determined (on a mid-market basis) by such
Lender, acting in a commercially reasonable manner, on the date of determination;
(c)
Derivative Instruments that incorporate either the 2014 ISDA Credit Derivatives Definitions or the 2003
ISDA Credit Derivatives Definitions, in each case as supplemented (or any
55
successor definitions thereto, collectively, the “ISDA CDS Definitions”) shall be deemed to create a short position with respect to
the Loans if such Lender is a protection buyer or the equivalent thereof for such Derivative Instrument and (A) the Loans are a
‘Reference Obligation’ under the terms of such Derivative Instrument (whether specified by name in the related documentation,
included as a ‘Standard Reference Obligation’ on the most recent list published by Markit, if ‘Standard Reference Obligation’
is specified as applicable in the relevant documentation or in any other manner) or (B) the Loans would be a ‘Deliverable
Obligation’ or an ‘Obligation’ (as defined in the ISDA CDS Definitions) of the Loan Parties under the terms of such Derivative
Instrument;
(d)
credit derivative transactions or other Derivative Instruments which do not incorporate the ISDA CDS
Definitions shall be counted for purposes of the Net Short Position determination if, with respect to the Loans, such transactions
are functionally equivalent to a transaction that offers such Lender protection in respect of the Loans; and
(e)
Derivative Instruments in respect of an index that includes any of the Loan Parties or any instrument issued
or guaranteed by any of the Loan Parties shall not be deemed to create a short position, so long as (A) such index is not created,
designed, administered or requested by such Lender and (B) the Loan Parties, and any Deliverable Obligation of the Loan Parties,
collectively, shall represent less than 5.0% of the components of such index.
“Net Short Representation” means, with respect to any Lender (other than an Unrestricted Lender) at any time, a representation
(including any deemed representation, as the case may be) from such Lender to the Borrower that it is not (x) a Net Short Lender at such time
or (y) knowingly and intentionally acting in concert with any of its Affiliates or branches for the express purpose of creating (and in fact
creating) the same economic effect with respect to the Loan Parties as though such Lender were a Net Short Lender at such time.
“Non-Bank Certificate” has the meaning specified in Section 3.01(b).
“Non-Consenting Lender” has the meaning specified in Section 3.07.
“Non-Defaulting Lender” means, at any time, each Lender that is not a Defaulting Lender at such time.
“Non-Loan Party” means any Restricted Subsidiary of the Borrower that is not a Loan Party.
“Not Otherwise Applied” means, with reference to the amount of any Permitted Equity Issuances that is proposed to be applied
to a particular use or transaction, that such amount was not previously applied in determining the permissibility of a transaction under the
Loan Documents (including, for the avoidance of doubt, any use of such amount to increase the Available Amount, to fund a Specified
Equity Contribution or to incur Contribution Indebtedness) where such permissibility was (or may have been) contingent on the receipt or
availability of such amount, it being agreed that the incurrence of secured debt shall be deemed one use transaction for purposes of this
definition.
“Note” means each of the Term Loan Notes.
“Obligations” means all,
(a)
advances to, and debts, liabilities, obligations, covenants and duties of, any Loan Party arising under any Loan
Document or otherwise with respect to any Loan, whether direct or indirect
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(including those acquired by assumption), absolute or contingent, due or to become due, now existing or hereafter arising and including
interest, fees and expenses that accrue after the commencement by or against any Loan Party of any proceeding under any Debtor Relief
Laws naming such Person as the debtor in such proceeding, regardless of whether such interest, fees and expenses are allowed claims in such
proceeding;
(b)
(c)
obligations of any Loan Party arising under any Secured Hedge Agreement; and
Cash Management Obligations;
provided that “Obligations” of any Guarantor shall exclude any Excluded Swap Obligations. Without limiting the generality of
the foregoing, the Obligations of the Loan Parties under the Loan Documents (and any of their Subsidiaries to the extent they have
obligations under the Loan Documents) include the obligation (including guarantee obligations) to pay principal, interest, reimbursement
obligations, charges, expenses, fees, Attorney Costs, indemnities and other amounts payable by any Loan Party and to provide Cash
Collateral under any Loan Document.
“OFAC” means the Office of Foreign Assets Control of the U.S. Treasury Department.
“OID” means original issue discount.
“Organization Documents” means,
(a)
with respect to any corporation, the certificate and/or articles of incorporation and the bylaws (or equivalent
or comparable constitutive documents with respect to any non-U.S. jurisdiction);
(b)
operating agreement; and
with respect to any limited liability company, the certificate or articles of formation or organization and
(c)
with respect to any partnership, joint venture, trust or other form of business entity, the partnership, joint
venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its
formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.
“Other Applicable ECF Indebtedness” has the meaning specified in Section 2.04(b)(i).
“Other Applicable Indebtedness” has the meaning specified in Section 2.04(b)(ii)(B).
“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection
between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed,
delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under,
engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan
Document).
“Other Taxes” has the meaning specified in Section 3.01(f).
“Overnight Rate” means, for any day, (a) with respect to any amount denominated in Dollars, the greater of (x) the Federal Funds
Rate and (y) an overnight rate reasonably determined by the Administrative Agent in accordance with bank industry rules on interbank
compensation and (b) with respect to any amount
57
denominated in any Alternative Currency, the rate of interest per annum reasonably determined by the Administrative Agent to be its cost of
funding such amount.
“Parent Entity” has the meaning specified in Section 6.01.
“Pari Passu Lien Debt” means any Indebtedness that is intended by the Borrower to be secured by Liens on all or any portion of
the Collateral that are pari passu in priority with the Liens on Collateral that secure the Obligations. For the avoidance of doubt, “Pari Passu
Lien Debt” includes the Initial Term Loans, the Delayed Draw Term Loans and the Senior Secured Notes as of the Closing Date and
excludes the ABL Credit Facility.
“Participant” has the meaning specified in Section 10.07(d).
“Participant Register” has the meaning specified in Section 10.07(e).
“Participation” has the meaning specified in Section 10.07(d).
“Payment” has the meaning specified in Section 10.28.
“Payment Conditions” has the meaning assigned to such term in the ABL Credit Agreement.
“Payment Notice” has the meaning specified in Section 10.28.
“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.
“Pension Plan” means any “employee pension benefit plan” (as such term is defined in Section 3(2) of ERISA), other than a
Multiemployer Plan, that is subject to Title IV of ERISA and is sponsored or maintained by any Loan Party or any of their respective ERISA
Affiliates or to which any Loan Party or any of their respective ERISA Affiliates contributes or has an obligation to contribute, or in the case
of a multiple employer or other plan described in Section 4064(a) of ERISA, has made, or has had an obligation to make, contributions at any
time in the preceding five plan years.
“Permitted Acquisition” means an Acquisition Transaction together with other Investments undertaken to consummate such
Acquisition Transaction; provided that:
(a)
after giving Pro Forma Effect to any such Acquisition Transaction or Investment, at the applicable time
determined in accordance with Section 1.08(f), no Event of Default shall have occurred and be continuing;
(b)
Documents;
the business of such Person, or such assets, as the case may be, constitute a business permitted by the Loan
(c)
such newly created or acquired Subsidiary shall be a Restricted Subsidiary at the time of such Permitted
Acquisition; and
(d)
with respect to each such purchase or other acquisition, all actions required to be taken with respect to any
such newly created or acquired Restricted Subsidiary or assets in order to satisfy the requirements set forth in Section 6.11 within
the time periods set forth therein to the extent applicable shall have been taken (or shall be taken), to the extent required by such
section (or arrangements for the taking of such actions after the consummation of the Permitted Acquisition shall have been
made).
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“Permitted Equity Issuance” means any,
(a)
public or private sale or issuance of any Qualified Equity Interests of the Borrower or any Parent Entity
(other than a Specified Equity Contribution);
(b)
contribution to the equity capital of the Borrower or any other Loan Party (other than (i) a Specified Equity
Contribution or (ii) in exchange for Disqualified Equity Interests); or
(c)
sale or issuance of Indebtedness of Holdings, the Borrower or a Restricted Subsidiary (other than
intercompany Indebtedness) that have been converted into or exchanged for Qualified Equity Interests of Holdings, the Borrower,
a Restricted Subsidiary or any Parent Entity;
provided that the amount of any Permitted Equity Issuance will be the amount of cash and Cash Equivalents received by a Loan Party or
Restricted Subsidiary in connection with such sale, issuances or contribution, and the fair market value of any other property received in
connection with such sale, issuance or contribution, (measured at the time made), without adjustment for subsequent changes in the value.
“Permitted Holders” means any of:
(a)
(b)
(c)
Jackson Wijaya and Affiliates (but excluding any portfolio companies of any of the foregoing);
the Management Stockholders;
the Co-Investors;
(d)
any group (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) of which the Persons
described in clauses (a), (b) or (c) above are members; provided that, without giving effect to the existence of such group or any
other group, the Persons described in clauses (a), (b) and (c) above, collectively, beneficially own (as defined in Rules 13(d) and
14(d) of the Exchange Act) Equity Interests representing at least a majority of the aggregate ordinary voting power represented by
the issued and outstanding Equity Interest of Holdings (or any Successor Holdings, if applicable) then held by such group); and
(e)
any Parent Entity, for so long as a majority of the aggregate ordinary voting power represented by the issued
and outstanding Equity Interests of such Parent Entity is beneficially owned (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act), directly or indirectly, by one or more Permitted Holders described in clauses (a), (b), (c) and/or (d) of the
definition thereof.
“Permitted Investment” means (a) any Permitted Acquisition, (b) any Acquisition Transaction and/or (c) any other Investment or
acquisition permitted hereunder.
“Permitted Junior Secured Refinancing Debt” means any Credit Agreement Refinancing Indebtedness that is Junior Lien Debt.
“Permitted Lien” means any Lien not prohibited by Section 7.01.
“Permitted Pari Passu Secured Refinancing Debt” means any Credit Agreement Refinancing Indebtedness that is Pari Passu
Lien Debt.
“Permitted Ratio Debt” means Indebtedness; provided that, at the time of incurrence thereof:
59
(a)
immediately after giving effect to the issuance, incurrence, or assumption of such Indebtedness:
(i)
in the case of any Pari Passu Lien Debt, the First Lien Net Leverage Ratio for the applicable Test
Period is equal to or less than the Closing Date First Lien Net Leverage Ratio less 0.50 to 1.00x;
(ii)
in the case of any Junior Lien Debt, the Secured Net Leverage Ratio for the applicable Test Period
is equal to or less than the Closing Date Secured Net Leverage Ratio less 0.25 to 1.00x; and
(iii)
in the case of any Indebtedness that is not secured by a Lien on any Collateral, the Total Net
Leverage Ratio for the applicable Test Period is equal to or less than the Closing Date Total Net Leverage Ratio,
in each case, after giving Pro Forma Effect to the incurrence of such Indebtedness and any use of proceeds thereof and measured as of and for
the Test Period immediately preceding the issuance, incurrence or assumption of such Indebtedness for which internal financial statements
are available; provided, that the aggregate principal amount of Permitted Ratio Debt incurred by Non-Loan Parties, together with the
aggregate principal amount of Incremental Equivalent Debt incurred by Non-Loan Parties, shall not exceed, in the aggregate, the greater of
(i) 100.00% of Closing Date EBITDA and (ii) 100.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination;
(b)
to the extent such Permitted Ratio Debt is required to be subject to the provisions of the Closing Date ABL
Intercreditor Agreement, a Debt Representative acting on behalf of the holders of such Indebtedness has become party to, or is
otherwise subject to the provisions of the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that
may be executed from time to time and reasonably acceptable to the Administrative Agent;
(c)
if such Indebtedness is intended to be Pari Passu Lien Debt or Junior Lien Debt, a Debt Representative acting
on behalf of the holders of such Permitted Ratio Debt has become party to, or is otherwise subject to the provisions of the Closing
Date ABL Intercreditor Agreement and (i) if such Permitted Ratio Debt is intended to be Pari Passu Lien Debt, an Equal Priority
Intercreditor Agreement or (ii) if such Permitted Ratio Debt is intended to be Junior Lien Debt, a Junior Lien Intercreditor
Agreement;
(d)
if such Permitted Ratio Debt is in the form of term loans and is Pari Passu Lien Debt, then the provisions of
Section 2.13(h) shall apply as if such Permitted Ratio Debt was in the form of Incremental Term Loans; and
(e)
any Permitted Ratio Debt (i) that is Pari Passu Lien Debt incurred as term facilities shall not mature prior to
the Latest Maturity Date of, and shall not have a Weighted Average Life to Maturity shorter than the remaining Weighted Average
Life to Maturity of, the Initial Term Loans, or (ii) that is Junior Lien Debt or Indebtedness that is not secured by a Lien on any
Collateral and incurred as term facilities shall not mature, or have scheduled amortization, prior to the Latest Maturity Date of the
Initial Term Loans; provided that this clause (e) shall not apply to the incurrence of any such Indebtedness pursuant to the Inside
Maturity Exception.
Permitted Ratio Debt will be deemed to include any Registered Equivalent Notes issued in exchange therefor.
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“Permitted Refinancing” means, with respect to any Person, any modification, refinancing, prepayment, refunding, replacement,
renewal or extension of any Indebtedness of such Person; provided that
(a)
the principal amount (or accreted value, if applicable) thereof does not exceed the principal amount (or
accreted value, if applicable) of the Indebtedness so modified, refinanced, refunded, replaced, renewed or extended except by an
amount equal to unpaid accrued interest and premium (including tender premiums) thereon, plus OID and upfront fees plus other
fees and expenses reasonably incurred, in connection with such modification, refinancing, refunding, replacement, renewal or
extension and by an amount equal to any existing commitments unutilized thereunder,
(b)
other than with respect to a Permitted Refinancing in respect of Indebtedness permitted pursuant to
Section 7.03(c) or Section 7.03(d), or Indebtedness incurred pursuant to the Inside Maturity Exception, such modification,
refinancing, refunding, replacement, renewal or extension has a final maturity date equal to or later than the final maturity date of,
and has a Weighted Average Life to Maturity equal to or greater than the remaining Weighted Average Life to Maturity of, the
Indebtedness being modified, refinanced, refunded, replaced, renewed or extended,
(c)
such Indebtedness shall not be incurred or guaranteed by any Loan Party or Restricted Subsidiary other than a
Loan Party or Restricted Subsidiary that was an obligor of the Indebtedness being exchanged, extended, renewed, replaced or
refinanced and no additional Loan Parties or Restricted Subsidiaries shall become liable for such Indebtedness;
(d)
if the Indebtedness being modified, refinanced, refunded, replaced, renewed, or extended is Junior Financing
or Junior Lien Debt,
(i)
to the extent the Indebtedness being modified, refinanced, refunded, replaced, renewed, or extended
is subordinated in right of payment to the Obligations, such modification, refinancing, refunding, replacement, renewal,
or extension is subordinated in right of payment to the Obligations on terms at least as favorable to the Lenders as those
contained in the documentation governing the Indebtedness being modified, refinanced, refunded, replaced, renewed or
extended,
(ii)
to the extent the Indebtedness being modified, refinanced, refunded, replaced, renewed, or
extended is unsecured, such modification, refinancing, refunding, replacement, renewal or extension is either (A)
unsecured or (B) secured only by Permitted Liens (provided that such incurrence will thereafter count in the calculation
of any remaining basket capacity thereunder, while such Indebtedness remains outstanding); and
(iii)
to the extent the Indebtedness being modified, refinanced, refunded, replaced, renewed, or
extended is secured by Liens, (A) such modification, refinancing, refunding, replacement, renewal or extension is either
(1) unsecured or (2) secured only by Permitted Liens, provided that if such Indebtedness is Pari Passu Lien Debt or
Junior Lien Debt, (x) to the extent such Indebtedness being modified, refinanced, refunded, replaced, renewed, or
extended is required to be subject to the provisions of the Closing Date ABL Intercreditor Agreement, a Debt
Representative acting on behalf of the holders of such Indebtedness has become party to, or is otherwise subject to the
provisions of the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that may be executed
from time to time and reasonably acceptable to the Administrative Agent and (y)
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a Debt Representative acting on behalf of the holders of such Indebtedness has become party to, or is otherwise subject
to the provisions of (1) if such Indebtedness is Pari Passu Lien Debt, an Equal Priority Intercreditor Agreement or (2) if
such Indebtedness is Junior Lien Debt, a Junior Lien Intercreditor Agreement and (B) to the extent that such Liens are
subordinated to the Liens securing the Obligations, such modification, refinancing, refunding, replacement, renewal or
extension is secured by Liens that are subordinated to the Liens securing the Obligations on terms at least as favorable
to the Lenders as those contained in the documentation (including any intercreditor or similar agreements) governing
the Indebtedness being modified, refinanced, replaced, refunded, replaced, renewed or extended;
(e)
if such Indebtedness is secured by assets of the Borrower or any Restricted Subsidiary:
(i)
such Indebtedness shall not be secured by Liens on any assets of the Borrower or any Restricted
Subsidiary that are not also subject to, or would be required to be subject to pursuant to the Loan Documents, a Lien
securing the Obligations (except (1) Liens on property or assets applicable only to periods after the Latest Maturity
Date at the time of incurrence, (2) any Liens on property or assets to the extent that a Lien on such property or asset is
also added for the benefit of the Lenders, (3) Liens on the proceeds of such Indebtedness funded into escrow pursuant
to customary escrow arrangements (4) any Liens on property or assets under the Indebtedness being exchanged,
extended, renewed, replaced or refinanced and (5) with respect to Indebtedness of Non-Loan Parties, Liens on assets of
any Non-Loan Party); and
(ii)
if such Indebtedness is Pari Passu Lien Debt or Junior Lien Debt, a Debt Representative acting on
behalf of the holders of such Indebtedness has become party to, or is otherwise subject to the provisions of (A) if such
Indebtedness is Pari Passu Lien Debt, an Equal Priority Intercreditor Agreement or (B) if such Indebtedness is Junior
Lien Debt, a Junior Lien Intercreditor Agreement;
(f)
in the case of any Permitted Refinancing in respect of any Permitted Pari Passu Secured Refinancing Debt or
any Permitted Junior Secured Refinancing Debt, in each case, such Permitted Refinancing is secured by Liens on assets of Loan
Parties that are subject to an Equal Priority Intercreditor Agreement or Junior Lien Intercreditor Agreement, as applicable; and
(g)
in the case of any Permitted Refinancing in respect of any Incremental Equivalent Debt, such Permitted
Refinancing shall be subject to the terms of clause (c) of the definition of “Incremental Equivalent Debt” as if such Permitted
Refinancing were also Incremental Equivalent Debt.
Permitted Refinancing will be deemed to include any Registered Equivalent Notes issued in exchange therefor.
“Permitted Reorganization” means any transaction (a) undertaken to effect a corporate reorganization (or similar transaction or
event) for operational or efficiency purposes, (b) undertaken in connection with and reasonably required for consummating a Qualifying IPO,
or (c) related to tax planning or tax reorganization, in each case, as determined in good faith by the Borrower and entered into after the
Closing Date; provided that, (i) no Event of Default is continuing immediately prior to such transaction and immediately after giving effect
thereto and (ii) after giving effect to such transactions, the security interests of the Lenders in the Collateral (taken as a whole) and the
Guarantees of the Obligations (taken as a whole),
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in each case, would not be materially impaired as a result thereof, and such transaction will not materially adversely affect the Borrower’s
ability to make anticipated payments with respect to the Obligations as and when they become due (in each case, as determined in good faith
by the Borrower).
“Person” means any natural person, corporation, limited liability company, unlimited liability company, trust, joint venture,
association, company, partnership, Governmental Authority or other entity.
“Plan” means any material “employee benefit plan” (as such term is defined in Section 3(3) of ERISA), other than a Foreign Plan,
established or maintained by any Loan Party or, with respect to any such plan that is subject to Section 412 of the Code or Title IV of ERISA,
any of their respective ERISA Affiliates.
“Platform” has the meaning specified in Section 6.02.
“Pledged Debt” has the meaning specified in the Security Agreement.
“Pledged Equity” has the meaning specified in the Security Agreement.
“Prepayment Date” has the meaning specified in Section 2.04(b)(vi).
“Prepayment Notice” means a written notice made pursuant to Section 2.04(a)(i) substantially in the form of Exhibit J.
“Private-Side Information” means any information with respect to Holdings and its Subsidiaries that is not Public-Side
Information.
“Pro Forma Basis” and “Pro Forma Effect” mean, with respect to compliance with any test or covenant or calculation
hereunder, the determination or calculation of such test, covenant or ratio (including in connection with Specified Transactions) in
accordance with Section 1.08.
“Pro Rata Share” means,
(a)
with respect to all payments, computations and other matters relating to the Term Loan of a given Class of
any Lender at any time a fraction (expressed as a percentage, carried out to the ninth decimal place), the numerator of which is the
amount of the Term Loan Exposure of such Class of such Lender at such time and the denominator of which is the aggregate Term
Loan Exposure of such Class of all Lenders at such time;
(b)
(i) with respect to all payments, computations and other matters relating to the Delayed Draw Term Loan
Commitment of any Lender at any time a fraction (expressed as a percentage, carried out to the ninth decimal place), the
numerator of which is the amount of the Delayed Draw Term Loan Commitment of that Lender and the denominator of which is
the aggregate Delayed Draw Term Loan Exposure of all Lenders at such time and (ii) with respect to all payments, computations
and other matters relating to the Delayed Draw Term Loans of any Lender at any time a fraction (expressed as a percentage,
carried out to the ninth decimal place), the numerator of which is the amount of the Delayed Draw Term Loan Exposure of that
Lender and the denominator of which is the aggregate Delayed Draw Term Loan Exposure of all Lenders at such time; and
(c)
with respect to all payments, computations and other matters relating to the Incremental Term Loans of any
Lender at any time a fraction (expressed as a percentage, carried
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out to the ninth decimal place), the numerator of which is the amount of the Incremental Term Loan Exposure of such Lender at
such time and the denominator of which is the aggregate Incremental Term Loan Exposure of all Lenders at such time.
“PTE” means a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be
amended from time to time.
“Public Company Costs” means costs relating to compliance with the Sarbanes-Oxley Act of 2002, as amended, and other
expenses arising out of or incidental to Holdings’ status (or any relevant Parent Entity’s status) as a reporting company, including costs, fees
and expenses (including legal, accounting and other professional fees) relating to compliance with provisions of the Securities Act and the
Exchange Act, the rules of securities exchange companies with listed equity securities, directors’ compensation, fees and expense
reimbursement, shareholder meetings and reports to shareholders, directors’ and officers’ insurance and other executive costs, legal and other
professional fees, and listing fees.
“Public Lenders” means Lenders that do not wish to receive Private-Side Information.
“Public-Side Information” (a) at any time prior to Holdings or any of its Subsidiaries becoming the issuer of any Traded
Securities, information that is (i) of a type that would be required by applicable Law to be publicly disclosed in connection with an issuance
by Holdings or any of its Subsidiaries of its debt or equity securities pursuant to a registered public offering made at such time or (ii) not
material to make an investment decision with respect to securities of Holdings or any of its Subsidiaries (for purposes of United States
federal, state or other applicable securities laws), and (b) at any time on or after Holdings or any of its Subsidiaries becoming the issuer of
any Traded Securities, information that does not constitute material non-public information (within the meaning of United States federal,
state or other applicable securities laws) with respect to such Parent Entity or Holdings or any of their respective Subsidiaries or any of their
respective securities.
“QFC” has the meaning assigned to the term “qualified financial contract” in, and shall be interpreted in accordance with, 12
U.S.C. 5390(c)(8)(D).
“QFC Credit Support” has the meaning specified in Section 10.26(a).
“Qualified Equity Interests” means any Equity Interests that are not Disqualified Equity Interests.
“Qualified Holding Company Debt” means unsecured Indebtedness of Holdings:
(a)
(b)
that is not subject to any Guarantee by any Loan Party (including the Borrower) or any Restricted Subsidiary;
that will not mature prior to the date that is six months after the Latest Maturity Date in effect on the date of
issuance or incurrence thereof;
(c)
that has no scheduled amortization or scheduled payments of principal and is not subject to mandatory
redemption, repurchase, prepayment or sinking fund obligation (it being understood that such Indebtedness may have mandatory
prepayment, repurchase or redemption provisions satisfying the requirements of clause (e) below);
(d)
that does not require any payments in cash of interest or other amounts (other than any AHIDO catch-up
payments) in respect of the principal thereof prior to the date that is 180 days after the Latest Maturity Date in effect on the date of
such issuance or incurrence; and
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(e)
that has mandatory prepayment, repurchase or redemption, covenant, default and remedy provisions
customary for senior discount notes of an issuer that is the parent of a borrower under senior secured credit facilities, in each case
as determined by the Borrower in good faith;
provided that any such Indebtedness shall constitute Qualified Holding Company Debt only if immediately after giving effect to the issuance
or incurrence thereof and the use of proceeds thereof, no Event of Default shall have occurred and be continuing.
“Qualified Professional Asset Manager” has the meaning specified in Section 9.16(a)(iii).
“Qualified Securitization Financing” means any Securitization Financing of a Securitization Subsidiary that meets the following
conditions:
(a)
such Qualified Securitization Financing (including financing terms, covenants, termination events and other
provisions) is in the aggregate economically fair and reasonable to the Borrower and the Securitization Subsidiary, as determined
by the Borrower in good faith;
(b)
all sales, transfers and/or contributions of Securitization Assets and related assets to the Securitization
Subsidiary are made at fair market value; and
(c)
the financing terms, covenants, termination events and other provisions thereof, including any Standard
Securitization Undertakings, shall be market terms, as determined by the Borrower in good faith.
“Qualifying IPO” means either (a) the issuance by Holdings or any Parent Entity of its common Equity Interests in a public
offering (other than a public offering pursuant to a registration statement on Form S-8 (or equivalent forms applicable for foreign public
companies or foreign private issuers) or any successor form) pursuant to an effective registration statement filed with the SEC in accordance
with the Securities Act or pursuant to a prospectus or similar documents filed with securities regulatory authorities outside of the United
States or (b) any transaction or series of transactions, including a SPAC IPO, that results in, or following which, any common Equity Interests
of the Borrower, any Parent Entity or any SPAC IPO Entity (or its successor by merger, amalgamation or other combination) being publicly
traded on any United States national securities exchange or over-the-counter market, or any analogous exchange or market in Canada, the
United Kingdom or the European Union.
“Ratio Amount” means an aggregate principal amount that, after giving Pro Forma Effect to the incurrence thereof, would not
result in:
(a)
with respect to an Incremental Facility or Incremental Equivalent Debt to be incurred as Pari Passu Lien
Debt, the First Lien Net Leverage Ratio for the applicable Test Period being greater than the Closing Date First Lien Net Leverage
Ratio less 0.50 to 1.00;
(b)
with respect to any Incremental Facility or Incremental Equivalent Debt to be incurred as Junior Lien Debt,
the Secured Net Leverage Ratio for the applicable Test Period being greater than the Closing Date Secured Net Leverage Ratio
less 0.25 to 1.00; and
(c)
with respect to any Incremental Facility or Incremental Equivalent Debt that is not secured by a Lien on any
Collateral, the Total Net Leverage Ratio for the applicable Test Period being greater than the Closing Date Total Net Leverage
Ratio.
“Recipient” means (a) each Agent or (b) any Lender, as applicable.
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“Reference Date” has the meaning specified in the definition of “Available Amount.”
“Refinanced Debt” has the meaning assigned to such term in the definition of “Credit Agreement Refinancing Indebtedness.”
“Refinanced Loans” has the meaning specified in Section 10.01(e)(ii).
“Refinancing Amendment” means an amendment to this Agreement executed by each of (a) the Borrower and Holdings, (b) the
Administrative Agent and (c) each Additional Lender and Lender that agrees to provide any portion of the Credit Agreement Refinancing
Indebtedness being incurred pursuant thereto, in accordance with Section 2.14.
“Refinancing Commitments” means any Refinancing Term Commitments.
“Refinancing Loans” means any Refinancing Term Loans.
“Refinancing Term Commitments” means one or more Classes of Term Loan commitments hereunder that result from a
Refinancing Amendment.
“Refinancing Term Loans” means one or more Classes of Term Loans that result from a Refinancing Amendment.
“Refunding Equity Interests” has the meaning specified in Section 7.06(o).
“Register” has the meaning specified in Section 10.07(c).
“Registered Equivalent Notes” means, with respect to any notes originally issued in a Rule 144A 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.
“Regulated Entity” means (a) any swap dealer registered with the U.S. Commodity Futures Trading Commission or security-
based swap dealer registered with the U.S. Securities and Exchange Commission, as applicable; or (b) any commercial bank with a
consolidated combined capital and surplus of at least $5,000,000,000 that is (i) a U.S. depository institution the deposits of which are insured
by the Federal Deposit Insurance Corporation; (ii) a corporation organized under section 25A of the U.S. Federal Reserve Act of 1913; (iii) a
branch, agency or commercial lending company of a foreign bank operating pursuant to approval by and under the supervision of the Board
under 12 C.F.R. part 211; (iv) a non-U.S. branch of a foreign bank managed and controlled by a U.S. branch referred to in clause (iii); or (v)
any other U.S. or non-U.S. depository institution or any branch, agency or similar office thereof supervised by a bank regulatory authority in
any jurisdiction.
“Related Indemnified Person” of an Indemnitee means (a) any controlling person or controlled affiliate of such Indemnitee, (b)
the respective directors, officers, or employees of such Indemnitee or any of its controlling persons or controlled affiliates and (c) the
respective agents of such Indemnitee or any of its controlling persons or controlled affiliates, in the case of this clause (c), acting at the
instructions of such Indemnitee, controlling person or such controlled affiliate; provided that each reference to a controlled affiliate or
controlling person in this definition shall pertain to a controlled affiliate or controlling person involved in the negotiation or syndication of
the Facility.
“Release Actions” has the meaning specified in Section 9.11(b).
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“Release Certificate” has the meaning specified in Section 9.11(b).
“Release Date” has the meaning specified in Section 9.11(b).
“Release/Subordination Event” has the meaning specified in Section 9.11(a)(i)(H).
“Relevant Governmental Body” means the Board of Governors of the Federal Reserve System or the Federal Reserve Bank of
New York, or a committee officially endorsed or convened by the Board of Governors of the Federal Reserve System or the Federal Reserve
Bank of New York, or any successor thereto.
“Replacement Loans” has the meaning specified in Section 10.01(e)(ii).
“Reportable Event” means, with respect to any Pension Plan, any of the events set forth in Section 4043(c) of ERISA or the
regulations issued thereunder, other than events for which the thirty day notice period has been waived.
“Repricing Event” means:
(a)
the incurrence by the Borrower or any other Loan Party of any Indebtedness (including any new or additional
Term Loans (other than Delayed Draw Term Loans) under this Agreement, whether incurred directly or by way of the conversion
of the Initial Term Loans into a new tranche of replacement Term Loans under this Agreement) (i) having an All-In Yield that is
less than the All-In Yield for the Initial Term Loans, and (ii) the proceeds of which are used to prepay (or, in the case of a
conversion, deemed to prepay or replace), in whole or in part, the outstanding principal of the Initial Term Loans and/or the
Delayed Draw Term Loans; or
(b)
any effective reduction in the All-In Yield applicable to the Initial Term Loans and/or the Delayed Draw
Term Loans (e.g., by way of amendment, waiver or otherwise);
provided that a Repricing Event shall not include any event described in clause (a) or ((b)) above that (i) is not consummated for the primary
purpose of lowering the All-In Yield applicable to the Initial Term Loans and/or the Delayed Draw Term Loans (as determined in good faith
by the Borrower), or (ii) that is consummated in connection with a Change of Control or Transformative Acquisition.
“Required Delayed Draw Lenders” means, as of any date of determination, Lenders having or holding more than 50% of the
sum of the aggregate Delayed Draw Commitments then outstanding.
“Required Facility Lenders” means, with respect to any Facility on any date of determination, Lenders having or holding more
than 50% of the sum of (a) the aggregate principal amount of outstanding Loans under such Facility and (b) the aggregate unused
Commitments under such Facility; provided, that the portion of outstanding Loans and the unused Commitments of such Facility, as
applicable, held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Facility
Lenders.
“Required Lenders” means, as of any date of determination, Lenders having or holding more than 50% of the sum of the
aggregate Term Loan Exposure of all Lenders; provided that the aggregate Term Loan Exposure of or held by any Defaulting Lender shall be
excluded for purposes of making a determination of Required Lenders.
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“Resolution Authority” means an EEA Resolution Authority or, with respect to any UK Financial Institution, a UK Resolution
Authority.
“Responsible Officer” means the executive chairman, chief executive officer, president, senior vice president, senior vice
president (finance), vice president, chief financial officer, treasurer, manager of treasury activities or assistant treasurer or other similar
officer or Person performing similar functions of a Loan Party and, solely for purposes of notices given pursuant to Article II, any other
officer or employee of the applicable Loan Party so designated by any of the foregoing officers in a notice to the Administrative Agent or any
other officer or employee of the applicable Loan Party designated in or pursuant to an agreement between the applicable Loan Party and the
Administrative Agent, and, as to any document delivered on the Closing Date, any secretary or assistant secretary of a Loan Party. Any
document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be conclusively presumed to have been
authorized by all necessary corporate, partnership and/or other action on the part of such Loan Party and such Responsible Officer shall be
conclusively presumed to have acted on behalf of such Loan Party. Unless otherwise specified, all references herein to a “Responsible
Officer” shall refer to a Responsible Officer of the Borrower.
“Restricted” means, when referring to cash or Cash Equivalents of the Borrower or any of the Restricted Subsidiaries, that such
cash or Cash Equivalents appear (or would be required to appear) as “restricted” on a consolidated balance sheet of the Borrower or such
Restricted Subsidiary (unless such appearance is related to a restriction in favor of, the Administrative Agent, the Collateral Agent or any
Lender).
“Restricted Payment” means any dividend or other distribution (whether in cash, securities or other property) with respect to any
Equity Interest of the Borrower or any of the Restricted Subsidiaries (in each case, solely to a holder of Equity Interests in such Person’s
capacity as a holder of such Equity Interests other than dividends or distributions payable solely in Equity Interests (other than Disqualified
Equity Interests) of the Borrower), or any payment (whether in cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, defeasance, acquisition, cancellation or termination of any such Equity Interest,
or on account of any return of capital to the Borrower’s stockholders, partners or members (or the equivalent Persons thereof). For the
avoidance of doubt, the payment of any Contractual Obligation that is based on, or measured with respect to the value of an Equity Interest,
including any such Contractual Obligations constituting compensation arrangements, shall not be considered a Restricted Payment. The
amount of any Restricted Payment not made in cash or Cash Equivalents shall be the fair market value of the securities or other property
distributed by dividend or other otherwise.
“Restricted Subsidiary” means any Subsidiary of the Borrower other than an Unrestricted Subsidiary.
“S&P” means Standard & Poor’s, a division of S&P Global Inc., and any successor thereto.
“Sale Leaseback Transaction” means a sale leaseback transaction with respect to all or any portion of any real property,
equipment or capital assets owned by a Loan Party or other property customarily included in such transactions.
“Same Day Funds” means disbursements and payments in immediately available funds.
“Sanctions” means any sanction administered or enforced by the United States government (including OFAC), the Government of
Canada, the United Nations Security Council, the European Union or HMT.
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“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to, or exercising jurisdiction
outside of the United States, any of its principal functions.
“Secured Hedge Agreement” means any Hedge Agreement that is entered into by and between any Loan Party and any Hedge
Bank and designated in writing by the Hedge Bank and the Borrower to the Administrative Agent as a “Secured Hedge Agreement” (but
only if such Hedge Agreement has not been designated as a “Secured Hedge Agreement” under the ABL Credit Agreement)
“Secured Net Leverage Ratio” means, with respect to any Test Period, the ratio of (a) Consolidated Secured Net Debt
outstanding as of the last day of such Test Period to (b) Consolidated Adjusted EBITDA of the Borrower for such Test Period.
“Secured Parties” means, collectively, the Administrative Agent, the Collateral Agent, the Lenders, each Hedge Bank party to a
Secured Hedge Agreement, each Cash Management Bank party to an agreement governing Cash Management Obligations, the Supplemental
Administrative Agent and each co-agent or sub-agent appointed by the Administrative Agent from time to time pursuant to Section 9.05 and
Section 9.12.
“Securities Act” means the U.S. Securities Act of 1933, as amended.
“Securitization Assets” means the accounts receivable, royalty or other revenue streams, other rights to payment (including with
respect to rights of payment pursuant to the terms of Joint Ventures) subject to a Qualified Securitization Financing and the proceeds thereof.
“Securitization Fees” means distributions or payments made directly or by means of discounts with respect to any participation
interest issued or sold in connection with, and other fees paid to a Person that is not a Securitization Subsidiary in connection with any
Qualified Securitization Financing.
“Securitization Financing” means any transaction or series of transactions that may be entered into by the Borrower or any of its
Subsidiaries pursuant to which the Borrower or any of its Subsidiaries may sell, convey or otherwise transfer to (a) a Securitization
Subsidiary (in the case of a transfer by the Borrower or any of its Subsidiaries) or (b) any other Person (in the case of a transfer by a
Securitization Subsidiary), or may grant a security interest or Lien in or on, any Securitization Assets of the Borrower or any of its
Subsidiaries, and any assets related thereto, including all collateral securing such Securitization Assets, all contracts and all guarantees or
other obligations in respect of such Securitization Assets, proceeds of such Securitization Assets and other assets that are customarily
transferred or in respect of which security interests are customarily granted in connection with asset securitization transactions involving
Securitization Assets as determined by the Borrower in good faith.
“Securitization Repurchase Obligation” means any obligation of a seller or transferor of Securitization Assets in a Qualified
Securitization Financing to repurchase Securitization Assets arising as a result of a breach of a Standard Securitization Undertaking,
including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, offset or counterclaim of any kind
as a result of any action taken by, any failure to take action by or any other event relating to the seller.
“Securitization Subsidiary” means a wholly owned Subsidiary of the Borrower (or another Person formed for the purposes of
engaging in a Qualified Securitization Financing in which the Borrower or any Subsidiary of the Borrower makes an Investment and to
which the Borrower or any Subsidiary of the Borrower transfers Securitization Assets and related assets) that engages in no activities other
than in connection with the financing of Securitization Assets of the Borrower or its Subsidiaries, all proceeds thereof and all rights
(contingent and other), collateral and other assets relating thereto, and any business
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or activities incidental or related to such business, and which is designated by the Board of Directors of the Borrower or such other Person (as
provided below) as a Securitization Subsidiary, and
(a)
no portion of the Indebtedness or any other obligation (contingent or otherwise) of which (i) is guaranteed by
Holdings, the Borrower or any other Subsidiary of the Borrower, other than another Securitization Subsidiary (excluding
guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization
Undertakings), (ii) is recourse to or obligates Holdings, the Borrower or any other Subsidiary of the Borrower, other than another
Securitization Subsidiary, in any way other than pursuant to Standard Securitization Undertakings or (iii) subjects any property or
asset of Holdings, the Borrower or any other Subsidiary of the Borrower, other than another Securitization Subsidiary, directly or
indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings;
(b)
with which none of Holdings, the Borrower or any other Subsidiary of the Borrower, other than another
Securitization Subsidiary, has any material contract, agreement, arrangement or understanding other than on terms which the
Borrower reasonably believes to be no less favorable to Holdings, the Borrower or such Subsidiary than those that might be
obtained at the time from Persons that are not Affiliates of the Borrower; and
(c)
to which none of Holdings, the Borrower or any other Subsidiary of the Borrower, other than another
Securitization Subsidiary, has any obligation to maintain or preserve such entity’s financial condition or cause such entity to
achieve certain levels of operating results;
it being agreed that a Securitization Asset consisting of an obligation of or to any Affiliate of a Loan Party (other than another Loan Party or
Restricted Subsidiary, unless otherwise permitted by Section 7.05) shall not result non-compliance with any of the foregoing provisions.
“Security Agreement” means, collectively, the Security Agreement executed by the Loan Parties, substantially in the form of
Exhibit F, together with each Security Agreement Supplement executed and delivered pursuant to Section 6.11.
“Security Agreement Supplement” has the meaning specified in the Security Agreement.
“Senior Secured Notes” means the notes due 2028 issued by the Borrower pursuant to the Senior Secured Notes Indenture.
“Senior Secured Notes Documents” means the Senior Secured Notes, the Senior Secured Notes Indenture and all other
documents evidencing, guaranteeing or otherwise governing the terms of the Senior Secured Notes.
“Senior Secured Notes Indenture” means that certain Indenture, dated as of October 18, 2021, among the Borrower, as issuer,
the guarantors party thereto and The Bank of New York Mellon, as trustee (as amended, restated, supplemented, or otherwise modified from
time to time) and any supplemental indenture or additional indenture to be entered into with respect to the Senior Secured Notes.
“Short Term Advances” means loans and advances made by Loan Parties having a term not exceeding 364 days (inclusive of any
roll over or extension of terms).
“Similar Business” means any business, the majority of whose revenues are derived from (a) business or activities conducted by
the Borrower and the Restricted Subsidiaries on the Closing Date, (b)
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any business that is a natural outgrowth or reasonable extension, development or expansion of any such business or any business similar,
reasonably related, incidental, complementary or ancillary to any of the foregoing or (c) any business that in the Borrower’s good faith
business judgment constitutes a reasonable diversification of businesses conducted by the Borrower and the Restricted Subsidiaries.
“SOFR” means a rate per annum equal to the secured overnight financing rate for such Business Day published by the Federal
Reserve Bank of New York (or a successor administrator of the secured overnight financing rate) on the website of the Federal Reserve Bank
of New York, currently at http://www.newyorkfed.org (or any successor source for the secured overnight financing rate identified as such by
the administrator of the secured overnight financing rate from time to time).
“Solvent” and “Solvency” mean, with respect to any Person on any date of determination, that on such date (a) the fair value of
the assets of such Person, on a consolidated basis with its Subsidiaries, exceeds its debts and liabilities, subordinated, contingent or
otherwise, on a consolidated basis, (b) the present fair saleable value of the property of such Person, on a consolidated basis with its
Subsidiaries, is greater than the amount that will be required to pay the probable liability of its debts and other liabilities, subordinated,
contingent or otherwise, on a consolidated basis, as such debts and other liabilities become absolute and matured, (c) such Person, on a
consolidated basis with its Subsidiaries, is able to pay its debts and liabilities, subordinated, contingent or otherwise, on a consolidated basis,
as such liabilities become absolute and matured and (d) such Person, on a consolidated basis with its Subsidiaries, is not engaged in, and is
not about to engage in, business for which it has unreasonably small capital. The amount of any contingent liability at any time shall be
computed as the amount that would reasonably be expected to become an actual and matured liability.
“SPAC IPO” means the acquisition, purchase, merger, amalgamation or other combination of the Borrower or any Parent Entity
by, or with, a publicly traded special purpose acquisition company or targeted acquisition company or any entity similar to the foregoing (a
“SPAC IPO Entity”) that results in, or following which, any common Equity Interests of the Issuer, any Parent Entity, or such SPAC IPO
Entity (or its successor by merger, amalgamation or other combination) being publicly traded on any United States national securities
exchange or over-the-counter market, or any analogous exchange or market in Canada, the United Kingdom or the European Union.
“SPC” has the meaning specified in Section 10.07(g).
“Specified Equity Contribution” has the meaning assigned to such term in the ABL Credit Agreement.
“Specified Event of Default” means an Event of Default pursuant to Section 8.01(a) or an Event of Default pursuant to
Section 8.01(f) with respect to the Borrower.
“Specified Representations” means those representations and warranties made by Holdings and the Initial Borrower in
Sections 5.01(a) (with respect to organizational existence only), 5.01(b)(ii), 5.02(a), 5.02(b)(i), 5.04, 5.13, 5.16, 5.17 (with respect the use of
proceeds of the Term Loans not in violation of the FCPA and OFAC) and 5.18; provided that such representations shall be made only with
respect to the Initial Borrower and Holdings.
“Specified Transaction” means any of the following identified by the Borrower: (a) transaction or series of related transactions,
including Investments and Acquisition Transactions, that results in a Person becoming a Restricted Subsidiary, (b) any designation of a
Subsidiary as a Restricted Subsidiary or an Unrestricted Subsidiary, (c) any transaction or series of related transactions, including
Dispositions, that results in a Restricted Subsidiary ceasing to be a Subsidiary of the Borrower, (d) any acquisition or
71
disposition of assets constituting a business unit, line of business or division of another Person or a facility, (e) any material acquisition or
disposition, (f) any restructuring of the business of the Borrower, whether by merger, consolidation, amalgamation or otherwise, (g) any
incurrence or repayment of Indebtedness (other than Indebtedness incurred or repaid under any revolving credit facility in the ordinary course
of business for working capital purposes), (h) any Restricted Payment and (i) transactions of the type given pro forma effect in (i) the Model
or (ii) any quality of earnings report prepared by a nationally recognized accounting firm and furnished to the Administrative Agent in
connection with the Transactions; provided that, at the Borrower’s election, any Specified Transaction having an aggregate value of less than
$1,000,000 shall not be calculated on a “Pro Forma Basis” or after giving “Pro Forma Effect”.
“Specified Transaction Adjustments” has the meaning specified in Section 1.08(c).
“Standard Securitization Undertakings” means representations, warranties, covenants and indemnities entered into by the
Borrower or any Subsidiary of the Borrower that are customary in a Securitization Financing.
“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the
denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special,
emergency or supplemental reserves) expressed as a decimal established by the FRB to which the Administrative Agent is subject with
respect to the Adjusted Eurocurrency Rate, for Eurocurrency Rate funding (currently referred to as “Eurocurrency Liabilities” in
Regulation D of the FRB). Such reserve percentages shall include those imposed pursuant to such Regulation D. Eurocurrency Rate Loans
shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration,
exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The
Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.
“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, unlimited liability
company or other entity of which (a) the Equity Interests having ordinary voting power (other than Equity Interests having such power only
by reason of the happening of a contingency) to elect a majority of the Board of Directors of such corporation, partnership, limited liability
company, unlimited liability company or other entity are at the time owned by such Person or (b) more than 50.0% of the Equity Interests are
at the time owned by such Person. Unless otherwise indicated in this Agreement, all references to Subsidiaries will mean Subsidiaries of the
Borrower. No Person shall be considered a Subsidiary of the Borrower unless the Borrower has the ability to Control such Subsidiary.
“Subsidiary Guarantor” or “Subsidiary Loan Party” means any Subsidiary (other than an Excluded Subsidiary) that is required
to be a Guarantor pursuant to the terms of the Loan Documents.
“Successor Borrower” has the meaning specified in Section 7.04(e).
“Successor Holdings” means any successor to Holdings pursuant to Section 7.04(a)(iii), Section 7.04(g)(i) or Section 7.10(b)(ii),
as applicable, together with such Person’s subsequent successors and assigns permitted hereunder.
“Supplemental Administrative Agent” and “Supplemental Administrative Agents” have the meanings specified in
Section 9.12(a).
“Supported QFC” has the meaning specified in Section 10.26(a).
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“Swap Obligations” 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.
“Swap Termination Value” means, in respect of any one or more Hedge Agreements, after taking into account the effect of any
legally enforceable netting agreement relating to such Hedge Agreements, (a) for any date on or after the date such Hedge Agreements have
been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date
referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one
or more mid-market or other readily available quotations provided by any recognized dealer in such Hedge Agreements (which may include a
Lender or any Affiliate or branch of a Lender).
“TARGET Day” means any day on which TARGET2 (or, if such payment system ceases to be operative, such other payment
system, if any, determined by the Administrative Agent to be a suitable replacement) is open for the settlement of payments in euros.
“TARGET2” means the Trans-European Automated Real-time Gross Settlement Express Transfer payment system which utilizes
a single shared platform and which was launched on November 19, 2007.
“Taxes” has the meaning specified in Section 3.01(a).
“Term Loan” means the term loans made by the Lenders on the Closing Date to the Borrower pursuant to Section 2.01(a). The
term “Term Loan” shall be deemed to also include Initial Term Loans, Delayed Draw Term Loans, Incremental Term Loans, Extended Term
Loans and Refinancing Term Loans, to the extent not otherwise indicated and as the context may require.
“Term Loan Commitment” means, as to each Lender, its obligation to make a Term Loan to the Borrower hereunder (including
any Initial Term Loan Commitment or Delayed Draw Commitment), expressed as an amount representing the maximum principal amount of
the Term Loans to be made by such Lender under this Agreement, as such commitment may be (a) reduced from time to time pursuant to
Section 2.05, (b) reduced or increased from time to time pursuant to (i) assignments by or to such Lender pursuant to an Assignment and
Assumption, (ii) a Refinancing Amendment or (iii) an Extension and (c) increased from time to time pursuant to an Incremental Amendment.
“Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding principal Dollar
Amount of the Term Loans of such Lender; provided, at any time prior to the making of the Term Loans, the Term Loan Exposure of any
Lender shall be equal to the Dollar Amount such Lender’s Term Loan Commitment, or, with regard to any Incremental Amendment at any
time prior to the making of the applicable Incremental Term Loans thereunder, the Term Loan Exposure of any Lender with respect to such
Incremental Term Facility shall be equal to such Lender’s Incremental Term Loan Commitment thereunder.
“Term Loan Lender” means a Lender having a Term Loan Commitment or other Term Loan Exposure.
“Term Loan Note” means a promissory note of the Borrower payable to any Lender or its registered assigns, in substantially the
form of Exhibit B-1 hereto, evidencing the aggregate Indebtedness of the Borrower to such Lender resulting from the Term Loans made by
such Lender.
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“Term Priority Collateral” means the “Fixed Asset Collateral” as defined in the Closing Date ABL Intercreditor Agreement.
“Term SOFR” means, for the applicable corresponding tenor, the forward-looking term rate based on SOFR that has been
selected or recommended by the Relevant Governmental Body.
“Termination Conditions” means, collectively, (a) the payment in full in cash of the Obligations (other than (i) contingent
indemnification obligations as to which no claim has been asserted, (ii) Obligations under Secured Hedge Agreements and (iii) Cash
Management Obligations) and (b) the termination of the Commitments.
“Test Period” in effect at any time means the most recent period of four consecutive fiscal quarters of the Borrower ended on or
prior to such time (taken as one accounting period) in respect of which financial statements for each quarter or fiscal year in such period are
available (which may be internal financial statements except to the extent this Agreement otherwise expressly states that the Test Period is
specified in a Compliance Certificate, in which case such financial statements shall have been delivered pursuant to Section 6.01(a) or ((b))
for the Test Period set forth in such Compliance Certificate). A Test Period may be designated by reference to the last day thereof (i.e., the
‘December 31st Test Period’ of a particular year refers to the period of four consecutive fiscal quarters of the Borrower ended on December
31st of such year), and a Test Period shall be deemed to end on the last day thereof.
“Threshold Amount” means (x) other than for purposes of Section 8.01, the greater of (a) 25% of Closing Date EBITDA and
(b) 25% of TTM Consolidated Adjusted EBITDA and (y) for purpoes of Section 8.01, the greater of (a) 10% of Closing Date EBITDA and
(b) 10% of TTM Consolidated Adjusted EBITDA.
“Total Net Leverage Ratio” means, with respect to any Test Period, the ratio of (a) Consolidated Net Debt as of the last day of
such Test Period to (b) Consolidated Adjusted EBITDA of the Borrower for such Test Period.
“Traded Securities” means any debt or equity securities issued pursuant to a public offering or Rule 144A offering.
“Transaction Expenses” means any fees or expenses incurred or paid by Holdings or any of its Subsidiaries in connection with
the Transactions, this Agreement and the other Loan Documents and the transactions contemplated hereby and thereby, including any
amortization thereof in any period, including any amortization thereof in any period.
“Transactions” means, collectively, the funding of the Initial Term Loans, the issuance of notes under the Senior Secured Notes
Indenture, the receipt of commitments under the ABL Credit Facility and the funding of the initial borrowings thereunder, the Closing Date
Refinancing, the Equity Contribution, the consummation of the Acquisition, including all payments to the holders of the Equity Interests of
the Acquired Business in connection therewith, and the payment of the Transaction Expenses.
“Transformative Acquisition” means any acquisition by the Borrower or any Restricted Subsidiary that is either (a) not permitted
by the terms of any Loan Document immediately prior to the consummation of such acquisition or (b) if permitted by the terms of the Loan
Documents immediately prior to the consummation of such acquisition, would not provide the Borrower and its Restricted Subsidiaries with
adequate flexibility under the Loan Documents for the continuation and/or expansion of their combined operations following such
consummation, as reasonably determined by the Borrower acting in good faith.
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“Treasury Equity Interests” has the meaning specified in Section 7.06(o).
“TTM Consolidated Adjusted EBITDA” means, as of any date of determination, the Consolidated Adjusted EBITDA of the
Borrower and the Restricted Subsidiaries, determined on a Pro Forma Basis, for the most recent Test Period.
“Type” means, with respect to a Loan, its character as a Base Rate Loan or a Eurocurrency Rate Loan.
“UK Financial Institution” means any BRRD Undertaking (as such term is defined under the PRA Rulebook (as amended from
time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person subject to IFPRU 11.6 of the FCA
Handbook (as amended from time to time) promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit
institutions and investment firms, and certain affiliates of such credit institutions or investment firms.
“UK Resolution Authority” means the Bank of England or any other public administrative authority having responsibility for the
resolution of any UK Financial Institution.
“U.S. Lender” has the meaning specified in Section 3.01(e).
“U.S. Special Resolution Regimes” has the meaning specified in Section 10.26(a).
“Undisclosed Administration” means, in relation to a Lender or its direct or indirect parent entity, the appointment of an
administrator, provisional liquidator, conservator, receiver, trustee, custodian, or other similar official by a supervisory authority or regulator
under or based on the law in the country where such Lender or such parent entity is subject to home jurisdiction supervision, if applicable law
requires that such appointment not be disclosed.
“Unfunded Advances/Participations” means with respect to the Administrative Agent, the aggregate amount, if any (i) made
available to the Borrower on the assumption that each Lender has made available to the Administrative Agent such Lender’s share of the
applicable Borrowing available to the Administrative Agent as contemplated by Section 2.01(b)(ii) and (ii) with respect to which a
corresponding amount shall not in fact have been returned to the Administrative Agent by the Borrower or made available to the
Administrative Agent by any such Lender.
“Unfunded Holdbacks” means any contingent purchase price payment obligations in connection with any Permitted Investment.
“Uniform Commercial Code” means the Uniform Commercial Code or any successor provision thereof as the same may from
time to time be in effect in the State of New York or the Uniform Commercial Code or any successor provision thereof (or similar code or
statute) of another jurisdiction, to the extent it may be required to apply to any item or items of Collateral.
“United States” and “U.S.” mean the United States of America.
“Unrestricted Lender” means any Regulated Entity, any Lead Arranger or any of their respective Affiliates or branches.
“Unrestricted Subsidiary” means (a) each Securitization Subsidiary and (b) any Subsidiary of the Borrower designated by the
Board of Directors of the Borrower as an Unrestricted Subsidiary pursuant to Section 6.13 subsequent to the date hereof and each Subsidiary
of such Subsidiary, in each case, until such
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Person ceases to be an Unrestricted Subsidiary of the Borrower in accordance with Section 6.13 or ceases to be a Subsidiary of the Borrower.
“USA PATRIOT Act” means The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001 (Title III of Public Law No. 107-56 (signed into law October 26, 2001)), as amended or modified from time
to time.
“USD LIBOR” means the London interbank offered rate for U.S. dollars.
“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by
dividing:
(a)
the sum of the products obtained by multiplying (i) the amount of each then remaining installment, sinking
fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by
(b)
the then outstanding principal amount of such Indebtedness;
provided that for purposes of determining the Weighted Average Life to Maturity of (i) any Refinanced Debt or Permitted Refinancing,
(ii) any Indebtedness that is being modified, refinanced, refunded, renewed, replaced or extended, or (iii) any Term Loans for purposes of
incurring any other Indebtedness (in any such case, the “Applicable Indebtedness”), the effects of any amortization payments or other
prepayments made on such Applicable Indebtedness (including the effect of any prepayment on remaining scheduled amortization) prior to
the date of the applicable modification, refinancing, refunding, renewal, replacement, extension or incurrence shall be disregarded.
“wholly owned” means, with respect to a Subsidiary of a Person, a Subsidiary of such Person all of the outstanding Equity
Interests of which (other than (a) director’s qualifying shares and (b) nominal shares issued to foreign nationals to the extent required by
applicable Law) are owned by such Person and/or by one or more wholly owned Subsidiaries of such Person.
“Withdrawal Liability” means the liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such
Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.
“Withholding Agent” means the Borrower, any Guarantor, the Administrative Agent or any other applicable withholding agent.
“Write-Down and Conversion Powers” means, (a) with respect to any EEA Resolution Authority, the write-down and
conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule, and (b) with respect to the United
Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a
liability of any UK Financial Institution or any contract or instrument under which that liability arises, to convert all or part of that liability
into shares, securities or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a
right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation
that are related to or ancillary to any of those powers.
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Section 1.02
Other Interpretive Provisions
. With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan
Document:
(a)
The meanings of defined terms are equally applicable to the singular and plural forms of the defined terms.
(b)
(i) The words “herein,” “hereto,” “hereof” and “hereunder” and words of similar import when used in any Loan
Document shall refer to such Loan Document as a whole and not to any particular provision thereof; (ii) references in this Agreement to an
Exhibit, Schedule, Article, Section, clause or sub-clause refer (A) to the appropriate Exhibit or Schedule to, or Article, Section, clause or sub-
clause in this Agreement or (B) to the extent such references are not present in this Agreement, to the Loan Document in which such
reference appears; (iii) the term “including” is by way of example and not limitation; (iv) the term “documents” includes any and all
instruments, documents, agreements, certificates, notices, reports, financial statements and other writings, however evidenced, whether in
physical or electronic form; (v) the phrase “permitted by” and the phrase “not prohibited by” shall be synonymous, and any transaction not
specifically prohibited by the terms of the Loan Documents shall be deemed to be permitted by the Loan Documents; (vi) the phrase
“commercially reasonable efforts” shall not require the payment of a fee or other amount to any third party or the incurrence of any expense
or liability by a Loan Party (or Affiliate) outside its ordinary course of its business; (vii) the phrase “in good faith” when used with respect to
a determination made by a Loan Party shall mean that such determination was made in the prudent exercise of its commercial judgment and
shall be deemed to be conclusive if fully disclosed in writing (in reasonable detail) to the Administrative Agent and the Lenders and neither
the Administrative Agent nor the Required Lenders have objected to such determination within ten Business Days of such disclosure to the
Administrative Agent and the Lenders; (viii) in the computation of periods of time from a specified date to a later specified date, the word
“from” means “from and including;” the words “to” and “until” each mean “to but excluding;” and the word “through” means “to and
including” and (ix) term “continuing” means, with respect to a Default or Event of Default, that it has not been cured (including by
performance) or waived.
(c)
Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not
affect the interpretation of this Agreement or any other Loan Document.
(d)
For all purposes under the Loan Documents, in connection with any division or plan of division under Delaware law
(or any comparable event under a different jurisdiction’s laws) (a “Division”), if (a) any asset, right, obligation or liability of any Person
becomes the asset, right, obligation or liability of a different Person, then it shall be deemed to have been transferred from the original Person
to the subsequent Person, and (b) any new Person comes into existence, such new Person shall be deemed to have been organized on the first
date of its existence by the holders of its Equity Interests at such time.
Section 1.03
Accounting and Finance Terms; Accounting Periods; Unrestricted Subsidiaries; Determination of Fair Market
Value
. All accounting terms, financial terms or components of such terms not specifically or completely defined herein shall be
construed in conformity with GAAP to the extent GAAP defines such term or a component of such term. To the extent GAAP does not
define any such term or a component of any such term, such term shall be calculated by the Borrower in good faith. For purposes of
calculating any consolidated amounts necessary to determine compliance by any Person and, if applicable, its Restricted Subsidiaries with
any ratio or other financial covenant in this Agreement, Unrestricted Subsidiaries shall be excluded. Unless the context indicates otherwise,
any reference to a “fiscal year” shall refer to a fiscal year of the Borrower ending December 31 and any reference to a “fiscal quarter” shall
refer to a fiscal quarter of the Borrower ending March 31, June 30, September 30 or December 31. All determinations of fair market value
under a Loan Document shall be made by the Borrower in good faith and, if such determination is
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consistent with a valuation or opinion of an Independent Financial Advisor, such determination shall be conclusive for all purposes under the
Loan Documents or related to the Obligations.
Section 1.04
Rounding
. Any financial ratios required to be satisfied in order for a specific action to be permitted under this Agreement shall be
calculated by dividing the appropriate component by the other component, carrying the result to one decimal place more than the number of
decimal places by which such ratio is expressed herein (the “Applicable Decimal Place”) and rounding the result up or down to the
Applicable Decimal Place.
Section 1.05
References to Agreements, Laws, Etc.
Unless otherwise expressly provided herein, (a) references to Organization Documents, agreements (including the Loan
Documents) and other contractual instruments shall be deemed to include all subsequent amendments, restatements, extensions, supplements
and other modifications thereto, but only to the extent that such amendments, restatements, extensions, supplements and other modifications
are permitted by this Agreement (including by way of amendment and/or waiver); 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 New York City time (daylight or standard,
as applicable).
Section 1.07
Available Amount Transactions
. If more than one action occurs on any given date the permissibility of the taking of which is determined hereunder by reference
to the amount of the Available Amount immediately prior to the taking of such action, the permissibility of the taking of each such action
shall be determined independently, but in no event may any two or more such actions be treated as occurring simultaneously, i.e., each
transaction must be permitted under the Available Amount as so calculated.
Section 1.08
Pro Forma Calculations; Limited Condition Acquisitions; Basket and Ratio Compliance
.
(a)
Notwithstanding anything to the contrary herein, the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio
and the Total Net Leverage Ratio shall be calculated in the manner prescribed by this Section 1.08; provided that notwithstanding anything to
the contrary in clauses ((b)), ((c)) or ((d)) of this Section 1.08, when calculating the First Lien Net Leverage Ratio for purposes of
Section 2.04(b)(i) and the Asset Sale Prepayment Percentage, the events described in this Section 1.08 that occurred subsequent to the end of
the applicable Test Period shall not be given pro forma effect.
(b)
For purposes of calculating the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio and the Total Net
Leverage Ratio, Specified Transactions identified by the Borrower that have been made (i) during the applicable Test Period or
(ii) subsequent to such Test Period and prior to or simultaneously with the event for which the calculation of any such ratio is made shall be
calculated on a pro forma basis assuming that all such Specified Transactions (and any increase or decrease in Consolidated Adjusted
EBITDA and the component financial definitions used therein attributable to any Specified Transaction) had occurred on the first day of the
applicable Test Period. If since the beginning of any applicable Test Period any Person that subsequently became a Restricted Subsidiary or
was merged, amalgamated or consolidated with or into the Borrower or any of its Restricted Subsidiaries since the beginning of such Test
Period shall have consummated any Specified Transaction identified by the Borrower that would have required adjustment pursuant to this
Section 1.08, then the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio and the Total Net Leverage Ratio shall be calculated to
give pro forma effect thereto in accordance with this Section 1.08.
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(c)
Whenever pro forma effect is to be given to a Specified Transaction, the pro forma calculations shall be made in good
faith by a Responsible Officer and may include, for the avoidance of doubt, the amount of cost savings, operating expense reductions;
synergies, material changes to amounts to be paid by or received by Loan Parties projected by the Borrower in good faith to be realized as a
result of specified actions taken, committed to be taken or expected to be taken (calculated on a pro forma basis as though amounts had been
realized on the first day of such Test Period and as if any such cost savings, operating expense reductions and synergies were realized during
the entirety of such period) relating to such Specified Transaction, net of the amount of actual benefits realized during such period from such
actions (such amounts, “Specified Transaction Adjustments”); provided that (i) such Specified Transaction Adjustments are reasonably
identifiable and quantifiable in the good faith judgment of the Borrower (it being agreed such determination need not be made in compliance
with Regulation S-X or other applicable securities law), (ii) such actions are taken, committed to be taken or expected to be taken no later
than thirty-six months after the date of such Specified Transaction, and (iii) no amounts shall be included pursuant to this clause ((c)) to the
extent duplicative of any amounts that are otherwise included in calculating Consolidated Adjusted EBITDA, whether through a pro forma
adjustment or otherwise, with respect to any Test Period.
(d)
In the event that the Borrower or any Restricted Subsidiary incurs (including by assumption or guarantees) or repays
(including by redemption, repayment, retirement or extinguishment) any Indebtedness included in the calculations of the First Lien Net
Leverage Ratio, the Secured Net Leverage Ratio and the Total Net Leverage Ratio, as the case may be, (i) during the applicable Test Period
or (ii) subsequent to the end of the applicable Test Period and prior to or simultaneously with the event for which the calculation of any such
ratio is made, then the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio and the Total Net Leverage Ratio shall be calculated
giving pro forma effect to such incurrence or repayment of Indebtedness, to the extent required, as if the same had occurred on the last day of
the applicable Test Period.
(e)
Notwithstanding anything in this Agreement or any Loan Document to the contrary,
(i)
the Borrower may rely on more than one basket or exception hereunder (including both ratio-based and non-
ratio based baskets and exceptions, and including partial reliance on different baskets that, collectively, permit the entire proposed
transaction) at the time of any proposed transaction, and the Borrower may, in its sole discretion, at any later time divide, classify
or reclassify such transaction (or any portion thereof) in any manner that complies with the available baskets and exceptions
hereunder at such later time (provided that with respect to reclassification of Indebtedness and Liens, any such reclassification
shall be subject to the parameters of Sections 7.01 and 7.03, as applicable);
(ii)
unless the Borrower elects otherwise, if the Borrower or its Restricted Subsidiaries in connection with any
transaction or series of such related transaction (A) incurs Indebtedness, creates Liens, makes Dispositions, makes Investments,
designates any Subsidiary as restricted or unrestricted or repays any Indebtedness or takes any other action under or as permitted
by a ratio-based basket and (B) incurs Indebtedness, creates Liens, makes Dispositions, makes Investments, designates any
Subsidiary as restricted or unrestricted or repays any Indebtedness or takes any other action under a non-ratio-based basket (which
shall occur within five Business Days of the events in clause (A) above), then the applicable ratio will be calculated with respect to
any such action under the applicable ratio-based basket without regard to any such action under such non-ratio-based basket made
in connection with such transaction or series of related transactions;
(iii)
if the Borrower or its Restricted Subsidiaries enters into any revolving, delayed draw or other committed
debt facility, the Borrower may elect to determine compliance of such
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debt facility (including the incurrence of Indebtedness and Liens from time to time in connection therewith) with this Agreement
and each other Loan Document on the date commitments with respect thereto are first received, assuming the full amount of such
facility is incurred (and any applicable Liens are granted) on such date, in which case such committed amount may thereafter be
borrowed or reborrowed, in whole or in part, from time to time, without further compliance with the Loan Documents, in lieu of
determining such compliance on any subsequent date (including any date on which Indebtedness is incurred pursuant to such
facility); provided that, in each case, any future calculation of any ratio based basket shall assume such facility is fully drawn until
such commitments are terminated; and
(iv)
if the Borrower or any Restricted Subsidiary incurs Indebtedness under a ratio-based basket, such ratio-
based basket (together with any other ratio-based basket utilized in connection therewith, including in respect of other
Indebtedness, Liens, Dispositions, Investments, Restricted Payments or payments in respect of Junior Financing) will be
calculated excluding the cash proceeds of such Indebtedness for netting purposes (i.e., such cash proceeds shall not reduce the
Borrower’s Consolidated Net Debt or Consolidated Secured Net Debt pursuant to clause (b) of the definition of such terms),
provided that the actual application of such proceeds may reduce Indebtedness for purposes of determining compliance with any
applicable ratio.
For example, if the Borrower incurs Indebtedness under the Fixed Incremental Amount on the same date that it incurs Indebtedness under the
Ratio Amount, then the First Lien Net Leverage Ratio and any other applicable ratio will be calculated with respect to such incurrence under
the Ratio Amount without regard to any incurrence of Indebtedness under the Fixed Incremental Amount. Unless the Borrower elects
otherwise, each Incremental Facility (or Incremental Equivalent Debt) shall be deemed incurred first under the Ratio Amount to the extent
permitted (and calculated prior to giving effect to any substantially simultaneous incurrence of any Indebtedness based on a basket or
exception that is not based on a financial ratio), with any balance incurred under the Fixed Incremental Amount. For purposes of determining
compliance with Section 2.13, in the event that any Incremental Facility or Incremental Equivalent Debt (or any portion thereof) meets the
criteria of Ratio Amount or Fixed Incremental Amount, the Borrower may, in its sole discretion, at the time of incurrence, divide, classify or
reclassify, or at any later time divide, classify or reclassify, such Indebtedness (or any portion thereof) in any manner that complies with
Section 2.13 on the date of such classification or any such reclassification, as applicable.
(f)
Notwithstanding anything in this Agreement or any Loan Document to the contrary, when,
(i)
calculating any applicable basket, ratio or financial metric in connection with the incurrence of Indebtedness,
the creation of Liens, the making of any Disposition, the making of an Investment, the making of a Restricted Payment, the
designation of a Subsidiary as restricted or unrestricted, the repayment of Indebtedness or for any other purpose;
(ii)
(iii)
action; or
determining the accuracy of any representation or warranty;
determining whether any Default or Event of Default has occurred, is continuing or would result from any
(iv)
determining compliance with any other condition precedent to any action or transaction;
in each case of clauses (i) through ((iv)) in connection with a Limited Condition Acquisition, the date of determination of such basket, ratio,
financial metric, the accuracy of such representation or warranty (but taking into account any earlier date specified therein), whether any
Default or Event of Default has occurred,
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is continuing or would result therefrom, or the satisfaction of any other condition precedent shall, at the option of the Borrower (the
Borrower’s election to exercise such option in connection with any Limited Condition Acquisition, an “LCA Election”), be deemed to be the
date the definitive agreements for such Limited Condition Acquisition are entered into (the “LCA Test Date”). If on a Pro Forma Basis after
giving effect to such Limited Condition Acquisition and the other transactions to be entered into in connection therewith (including any
incurrence of Indebtedness and the use of proceeds thereof) such baskets, ratios, financial metrics, representations and warranties, absence of
defaults, satisfaction of conditions precedent and other provisions are calculated as if such Limited Condition Acquisition or other
transactions had occurred at the beginning of the most recent Test Period ending prior to the LCA Test Date for which financial statements
are available, the Borrower could have taken such action on the relevant LCA Test Date in compliance with the applicable baskets, ratios,
financial metrics or other provisions, such provisions shall be deemed to have been complied with, unless a Specified Event of Default is
continuing on the date on which such Limited Condition Acquisition is consummated. For the avoidance of doubt, (i) if any of such baskets,
ratios, financial metrics, representations and warranties, absence of defaults, satisfaction of conditions precedent or other provisions are
exceeded or breached as a result of fluctuations in such basket, ratio or financial metrics (including due to fluctuations in Consolidated
Adjusted EBITDA), a change in facts and circumstances or other provisions at or prior to the consummation of the relevant Limited
Condition Acquisition, such baskets, ratios, financial metrics, representations and warranties, absence of defaults, satisfaction of conditions
precedent and other provisions will not be deemed to have been exceeded, breached, or otherwise failed as a result of such fluctuations or
changed circumstances solely for purposes of determining whether the Limited Condition Acquisition and any related transactions is
permitted hereunder and (ii) such baskets, ratios, financial metrics and compliance with such conditions shall not be tested at the time of
consummation of such Limited Condition Acquisition or related Specified Transactions. If the Borrower has made an LCA Election for any
Limited Condition Acquisition, then in connection with any subsequent calculation of any ratio, financial metric or basket availability with
respect to any other Specified Transaction or otherwise on or following the relevant LCA Test Date and prior to the earlier of the date on
which such Limited Condition Acquisition is consummated or the date that the definitive agreement for such Limited Condition Acquisition
is terminated or expires without consummation of such Limited Condition Acquisition, any such ratio, financial metric or basket shall be
calculated on a Pro Forma Basis assuming such Limited Condition Acquisition and other transactions in connection therewith (including any
incurrence of Indebtedness and the use of proceeds thereof) have been consummated.
(g)
[Reserved].
(h)
For purposes of determining the maturity date and/or Weighted Average Life of any Indebtedness, bridge loans or
Indebtedness funded into escrow that are subject to customary conditions (as determined by the Borrower in good faith, including conditions
requiring no payment or bankruptcy event of default) that would (x) in the case of bridge loans, either automatically be extended as,
converted into or required to be exchanged for permanent refinancing or (y) in the case of Indebtedness funded into escrow, that would be
mandatorily repaid or redeemed if the conditions to release from escrow are not met, in each case, shall be deemed to have the maturity date
and/or Weighted Average Life, as applicable, as so extended, converted or exchanged.
Section 1.09
Currency Equivalents Generally
.
(a)
No Default or Event of Default shall be deemed to have occurred under a Loan Document solely as a result of changes
in rates of currency exchange occurring after the time any applicable action (including any incurrence of a Lien or Indebtedness or the
making of an Investment) so long as such action (including any incurrence of a Lien or Indebtedness or the making of an Investment) was
permitted hereunder when made.
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(b)
For purposes of this Agreement and the other Loan Documents, where the permissibility of a transaction or
determinations of required actions or circumstances depend upon compliance with, or are determined by reference to, amounts stated in
Dollars, any requisite currency translation (i) with respect to Loans or Commitments, shall be based on the Exchange Rate and (ii) with
respect to any other amounts, shall be based on the rate of exchange between the applicable currency and Dollars as reasonably determined
by the Borrower, in each case in effect on the Business Day immediately preceding the date of such transaction or determination (subject to
clauses ((c)) and ((d)) below) and shall not be affected by subsequent fluctuations in exchange rates.
(c)
For purposes of determining compliance with any Dollar-denominated restriction on the incurrence of Indebtedness, the
Dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be calculated based on the Exchange Rate in
effect on the date such Indebtedness was incurred, in the case of term debt, or first committed, in the case of revolving credit debt (or, in the
case of an LCA Election, on the date of the applicable LCA Test Date); provided that, if such Indebtedness is incurred to refinance other
Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable Dollar-denominated restriction to be
exceeded if calculated at the Exchange Rate in effect on the date of such refinancing, such Dollar-denominated restriction shall be deemed
not to have been exceeded so long as the principal amount of such Indebtedness so refinanced does not exceed the principal amount of such
Indebtedness being refinanced. Notwithstanding the foregoing, the principal amount of any Indebtedness incurred to refinance other
Indebtedness, if incurred in a different currency from the Indebtedness being refinanced, shall be calculated based on the Exchange Rate that
is in effect on the date of such refinancing.
(d)
For purposes of determining the First Lien Net Leverage Ratio, the Secured Net Leverage Ratio and the Total Net
Leverage Ratio, including Consolidated Adjusted EBITDA when calculating such ratios, all amounts denominated in a currency other than
Dollars will be converted to Dollars for any purpose (including testing the any financial maintenance covenant) at the effective rate of
exchange in respect thereof reflected in the consolidated financial statements of the Borrower for the applicable Test Period for which such
measurement is being made, and will reflect the currency translation effects, determined in accordance with GAAP, of Hedge Agreements
permitted hereunder for currency exchange risks with respect to the applicable currency in effect on the date of determination of the Dollar
equivalent of such Indebtedness.
Section 1.10
Co-Borrowers
. Notwithstanding anything herein to the contrary, the Borrower, upon 15 Business Days prior written notice to the Administrative
Agent (or such shorter period as reasonably agreed by the Administrative Agent), may cause any Loan Party on or after the Closing Date by
written election to the Administrative Agent to become a borrower (each such Loan Party, a “Co-Borrower”, and, together with the
Borrower, the “Co-Borrowers”) under each of the Facilities hereunder on a joint and several basis (such date, the “Co-Borrower Effective
Date”); provided that such Loan Party shall (i) execute a joinder to this Agreement in form and substance reasonably satisfactory to the
Administrative Agent assuming all obligations of a Co-Borrower hereunder, (ii) at least three Business Days prior to such Co-Borrower
Effective Date, provide to the Administrative Agent and the Lenders all documentation and other information required by United States
regulatory authorities under applicable “know your customer” and anti-money laundering Laws, including without limitation Title III of the
USA Patriot Act, that shall be reasonably requested by the Administrative Agent in writing at least 10 Business Days prior to the
consummation of such joinder and (iii) provide to the Administrative Agent and the Lenders, if such Loan Party qualifies as a “legal entity
customer” under the Beneficial Ownership Regulation, a Beneficial Ownership Certification and (iv) be a domestic Subsidiary Guarantor
wholly owned by the Borrower. The Lenders hereby irrevocably authorize the Administrative Agent to enter into any amendment to this
Agreement or to any other Loan Document as may be necessary or appropriate in order to establish any additional Borrower pursuant to this
Section 1.10 and such technical amendments, and other customary amendments with respect to provisions of this Agreement
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relating to taxes for borrowers, in each case as may be necessary or appropriate in the reasonable opinion of the Administrative Agent and the
Borrower in connection therewith.
Upon the later of execution and delivery of a joinder to this Agreement by a Co-Borrower and the countersignature of the
Administrative Agent thereto, each Co-Borrower agrees that it is jointly and severally liable for the obligations of each other Co-Borrower
hereunder with respect to any Class of Loans on an individual tranche basis, including with respect to the payment of principal of and interest
on all Loans on an individual tranche basis and the payment of fees and indemnities and reimbursement of costs and expenses. Each Co-
Borrower is accepting joint and several liability hereunder in consideration of the financial accommodations to be provided by the
Administrative Agent, the Collateral Agent and the Lenders under this Agreement, for the mutual benefit, directly and indirectly, of each of
the Co-Borrowers and in consideration of the undertakings of each of the Co-Borrowers to accept joint and several liability for the
obligations of each of them. Each Co-Borrower, jointly and severally, hereby irrevocably and unconditionally accepts, as a co-debtor, joint
and several liability with each other Co-Borrower, with respect to the payment and performance of all of the Obligations, it being the
intention of the parties hereto that all Obligations shall be the joint and several obligations of all of the Co-Borrowers without preferences or
distinction among them. If and to the extent that any of the Co-Borrowers shall fail to make any payment with respect to any of the
Obligations as and when due or to perform any of such Obligations in accordance with the terms thereof, then in each such event each other
Borrower will make such payment with respect to, or perform, such Obligations. Each Co-Borrower further agrees that the Borrower will be
such Co-Borrower’s agent for administrative, mechanical, and notice provisions in this Agreement and any other Loan Document and the
Lenders and the Administrative Agent hereby agree that each Co-Borrower will have the same rights under the Loan Documents as if it is the
Borrower and for any other purposes under the provisions of this Agreement, including the affirmative and negative covenants, each such
Co-Borrower will be treated as a Restricted Subsidiary that is a Subsidiary Guarantor.
ARTICLE II.
THE COMMITMENTS AND BORROWINGS
Section 2.01
Term Loans
.
(a)
Term Loan Commitments. Subject only to the conditions set forth in Section 4.01, each Lender with an Initial Term
Loan Commitment severally agrees to make to the Borrower on the Closing Date a term loan denominated in Dollars equal to such Lender’s
Initial Term Loan Commitment (the “Initial Term Loans”; provided that any Delayed Draw Term Loans that are funded hereunder shall also
be deemed to constitute Initial Term Loans following such funding). Initial Term Loans may be Base Rate Loans or Eurocurrency Rate
Loans at the option of the Borrower, as further provided herein. At any time during the Delayed Draw Commitment Period, subject to the
terms and conditions set forth in Section 4.02 hereof, each Lender with a Delayed Draw Commitment severally agrees to make to the
Borrower on the Delayed Draw Closing Date a Term Loan denominated in Dollars in an aggregate amount requested by the Borrower but not
exceeding such Lender’s unfunded Delayed Draw Commitment as of such date immediately prior to giving effect to such Borrowing (the
“Delayed Draw Term Loans”); provided that the aggregate principal amount of all such Borrowings of Delayed Draw Term Loans shall not
exceed the aggregate amount of the Delayed Draw Commitments as of the Closing Date. Amounts borrowed under this Section 2.01(a) and
repaid or prepaid may not be reborrowed. Initial Term Loans and Delayed Draw Term Loans may be Base Rate Loans (in the case of Term
Loans denominated in Dollars) or Eurocurrency Rate Loans, as further provided herein; provided that Delayed Draw Term Loans will
initially be of the same Type and will have the same Interest Period as the Term Loans outstanding immediately prior to the Borrowing of
such Delayed Draw Term Loans. To the extent practicable, the Initial Term Loans and Delayed Draw Term Loans will be treated as the same
Class (i.e., “fungible”) and will have the same CUSIP.
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(b)
Borrowing Mechanics for Term Loans.
(i)
Subject to Sections 4.01(a)(i), 4.02(c), and 2.13(a), each Borrowing of Term Loans shall be made upon the
Borrower’s notice to the Administrative Agent, which may only be given in writing. Each such notice must be received by the
Administrative Agent not later than (A) 1:00 p.m. three Business Days prior to the requested date of any Borrowing of
Eurocurrency Rate Loans and (B) 12:00 noon one Business Day prior to the requested date of any Borrowing of Base Rate Loans;
provided however that (1) if the Borrower wishes to request Eurocurrency Rate Loans having an Interest Period other than one,
two, three or six months in duration as provided in the definition of “Interest Period,” the applicable notice must be received by
the Administrative Agent not later than 11:00 a.m. four Business Days prior to the requested date of such Borrowing (or such
shorter period as reasonably agreed by the Administrative Agent), conversion or continuation, whereupon the Administrative
Agent shall give prompt notice to the applicable Lenders of such request and determine whether the requested Interest Period is
acceptable to all of them and not later than 11:00 a.m., three Business Days before the requested date of such Borrowing,
conversion or continuation, the Administrative Agent shall notify the Borrower (which notice may be by telephone) whether or not
the requested Interest Period has been consented to by all the applicable Lenders and (2) any (I) such notice delivered in
connection with the initial Borrowing of Term Loans on the Closing Date must be received by the Administrative Agent no later
than 1:00 p.m. on the Closing Date and (II) such notices may be conditioned on the occurrence of the Closing Date or, with respect
to Delayed Draw Term Loans or Incremental Facility Term Loans, may be conditioned on the occurrence of any transaction
anticipated to occur in connection with such Delayed Draw Term Loans or Incremental Facility Term Loans.
(ii)
Each notice by the Borrower pursuant to this Section 2.01(b) must be delivered to the Administrative Agent
in the form of a Committed Loan Notice, appropriately completed and signed by a Responsible Officer of the Borrower. The
Delayed Draw Term Loans shall be available in a single Borrowing. Each Committed Loan Notice shall specify (A) that the
Borrower is requesting a Term Loan Borrowing, (B) the requested date of the Borrowing (which shall be a Business Day), (C) the
principal amount of Term Loans to be borrowed, (D) the Type of Term Loans to be borrowed and (E) if applicable, the duration of
the Interest Period with respect thereto. If the Borrower fails to specify a Type of Term Loan in a Committed Loan Notice, then (x)
in the case of Term Loans denominated in Dollars, the applicable Term Loans shall be made as Base Rate Loans and (y) in the
case of Term Loans denominated in an Alternative Currency, the applicable Term Loans shall be made as Eurocurrency Rate
Loans with an Interest Period of one month; provided that Delayed Draw Term Loans will initially be of the same Type and will
have the same Interest Period as the Term Loans outstanding immediately prior to the Borrowing of such Delayed Draw Term
Loans. If the Borrower requests a Borrowing of Eurocurrency Rate Loans in any such Committed Loan Notice, but fails to specify
an Interest Period, for such Eurocurrency Rate Loans, the Borrower will be deemed to have specified an Interest Period of one
month (other than with respect to a Delayed Draw Term Loan).
(iii)
Borrowings of more than one Type may be outstanding at the same time; provided that the total number of
Interest Periods for Eurocurrency Rate Loans outstanding under this Agreement at any time shall comply with Section 2.07(d).
(iv)
Following receipt of a Committed Loan Notice, the Administrative Agent shall promptly notify each Lender
of the amount of its Pro Rata Share of the applicable tranche of Term Loans. In the case of each Borrowing, each Appropriate
Lender shall make the amount of its Term Loan available to the Administrative Agent in Same Day Funds at the Administrative
Agent’s Office not later than 1:00 p.m., on the Business Day specified in the applicable Committed Loan
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Notice. Upon satisfaction of the applicable conditions to such Borrowing, the Administrative Agent shall make all funds so
received available to the Borrower in like funds as received by the Administrative Agent either by (A) crediting the account of the
Borrower on the books of the Administrative Agent with the amount of such funds or (B) wire transfer of such funds, in each case
in accordance with instructions provided to (and reasonably acceptable to) the Administrative Agent by the Borrower.
(v)
The failure of any Lender to make the Term Loan to be made by it as part of any Borrowing shall not relieve
any other Lender of its obligation, if any, hereunder to make its Term Loan on the date of such Borrowing, but no Lender shall be
responsible for the failure of any other Lender to make the Term Loan to be made by such other Lender on the date of any
Borrowing.
Section 2.02
Conversion/Continuation
.
(a)
Each conversion of Loans from one Type to another, and each continuation of Eurocurrency Rate Loans shall be made
upon the Borrower’s irrevocable notice to the Administrative Agent, which may only be given in writing. Each such notice must be received
by the Administrative Agent not later than 1:00 p.m. (New York City time in the case of Loans denominated in Dollars, or London time in
the case of any Borrowing denominated in Euros or another Alternative Currency) on the requested date of any conversion of Eurocurrency
Rate Loans to Base Rate Loans and not later than 2:00 p.m. three Business Days prior to the requested date of continuation of any
Eurocurrency Rate Loans or any conversion of Base Rate Loans to Eurocurrency Rate Loans denominated in Dollars. Each notice by the
Borrower pursuant to this Section 2.02(a) must be delivered to the Administrative Agent in the form of a Conversion/Continuation Notice,
appropriately completed and signed by a Responsible Officer of the Borrower. Each conversion to or continuation of Eurocurrency Rate
Loans shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each conversion to Base Rate Loans
shall be in a principal amount of $500,000 or a whole multiple of $100,000 in excess thereof. Each Conversion/Continuation Notice shall
specify (i) whether the Borrower is requesting a conversion of Loans from one Type to the other, or a continuation of Eurocurrency Rate
Loans, (ii) the requested date of the conversion or continuation, as the case may be (which shall be a Business Day), (iii) the principal amount
of Loans to be converted or continued, (iv) the Class of Loans to be converted or continued, (v) the Type of Loans to which such existing
Loans are to be converted, if applicable, and (vi) if applicable, the duration of the Interest Period with respect thereto. If (x) with respect to
any Eurocurrency Rate Loans denominated in Dollars, the Borrower fails to give a timely notice requesting a conversion or continuation,
then the applicable Loans shall be converted to Base Rate Loans or (y) with respect to any Eurocurrency Rate Loans denominated in any
Alternative Currency, the Borrower fails to give a timely notice requesting a conversion or continuation, then the applicable tranche of Term
Loans shall be converted to, a Eurocurrency Rate Loan with an Interest Period of one month. Any such automatic conversion or continuation
pursuant to the immediately preceding sentence shall be effective as of the last day of the Interest Period then in effect with respect to the
applicable Eurocurrency Rate Loans. If the Borrower requests a conversion to, or continuation of Eurocurrency Rate Loans in any such
Conversion/Continuation Notice, but fails to specify an Interest Period, it will be deemed to have specified an Interest Period of one month.
(b)
Following receipt of a Conversion/Continuation Notice, the Administrative Agent shall promptly notify each applicable
Lender of its Pro Rata Share of the applicable Class of Loans, and if no timely notice of a conversion or continuation is provided by the
Borrower, the Administrative Agent shall notify each Lender of the details of any automatic conversion to Base Rate Loans or continuation
of Loans described in Section 2.02(a).
(c)
Except as otherwise provided herein, a Eurocurrency Rate Loan may be continued or converted only on the last day of
an Interest Period for such Eurocurrency Rate Loan. Upon the occurrence
85
and during the continuation of an Event of Default, the Administrative Agent or the Required Lenders may require by notice to the Borrower
that no Loans denominated in Dollars may be converted to or continued as Eurocurrency Rate Loans.
Section 2.03
Availability
. (a) Unless the Administrative Agent shall have received notice from a Lender prior to the date of any Borrowing that such
Lender will not make available to the Administrative Agent such Lender’s Pro Rata Share of such Borrowing, the Administrative Agent may
assume that such Lender has made such Pro Rata Share available to the Administrative Agent on the date of such Borrowing, and the
Administrative Agent may, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. If the
Administrative Agent shall have so made funds available, then, to the extent that such Lender shall not have made such portion available to
the Administrative Agent, each of such Lender and the Borrower severally agrees to repay to the Administrative Agent forthwith on demand
such corresponding amount together with interest thereon, for each day from the date such amount is made available to the Borrower until the
date such amount is repaid to the Administrative Agent at (a) in the case of the Borrower, the interest rate applicable at the time to the
applicable Loans comprising such Borrowing and (b) in the case of such Lender, the Overnight Rate plus any administrative, processing, or
similar fees customarily charged by the Administrative Agent in accordance with the foregoing. A certificate of the Administrative Agent
submitted to any Lender with respect to any amounts owing under this Section 2.03 shall be conclusive in the absence of manifest error. If
the Borrower and such Lender shall pay such interest to the Administrative Agent for the same or an overlapping period, the Administrative
Agent shall promptly remit to the Borrower the amount of such interest paid by the Borrower for such period. If such Lender pays its share
of the applicable Borrowing to the Administrative Agent, then the amount so paid shall constitute such Lender’s applicable Loan included in
such Borrowing. Any payment by the Borrower shall be without prejudice to any claim the Borrower may have against a Lender that shall
have failed to make such payment to the Administrative Agent. A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this Section 2.03 shall be conclusive, absent manifest error.
(b)
Unless the Administrative Agent shall have received notice from a Lender holding Delayed Draw Commitments prior to
the date of any Borrowing of Delayed Draw Term Loans that such Lender will not make available to the Administrative Agent
such Lender’s Pro Rata Share of such Borrowing, the Administrative Agent may assume that such Lender has made such Pro Rata
Share available to the Administrative Agent on the date of such Borrowing, and the Administrative Agent may in its sole
discretion, in reliance upon such assumption, make available to the Borrower on such date a corresponding amount. In the event
that the Administrative Agent has elected to make available to the Borrower any portion of the Delayed Draw Term Loans and any
Lender with a Delayed Draw Commitment has failed to fund its portion thereof on the date and time required by this Agreement
(any such Lender, the “Unfunded DDTL Commitment Lender”, any such Delayed Draw Term Loans provided by the
Administrative Agent, the “Fronted Delayed Draw Term Loans”), until the time that such Unfunded DDTL Commitment
Lender has funded its portion of any Fronted Delayed Draw Term Loans and reimbursed the Administrative Agent, the
Administrative Agent shall be entitled to receive any interest accruing applicable to such unfunded Fronted Delayed Draw Term
Loans and shall be entitled to retain the Delayed Draw Upfront Fee applicable to such Delayed Draw Commitments. Upon
funding by the relevant Unfunded DDTL Commitment Lender of any Fronted Delayed Draw Term Loans, (x) the proceeds of such
funded Fronted Delayed Draw Term Loans shall be retained by the Administrative Agent, (y) the Administrative Agent shall remit
the Delayed Draw Upfront Fee to such Unfunded DDTL Commitment Lender and (z) interest applicable to such funded Fronted
Delayed Draw Term Loans commencing with the date of such funding shall accrue to such Unfunded DDTL Commitment Lender.
Additionally, if any Unfunded DDTL Commitment Lender becomes a Defaulting Lender, then such Unfunded DDTL
Commitment Lender’s Fronted Delayed Draw Term Loans may be assigned (or in if the Unfunded DDTL Commitment Lender
becomes a Defaulting Lender pursuant to clause (d) of the definition thereof, shall be assigned) to the Administrative Agent
without any further action by any party and the Administrative Agent shall be the
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“Lender” with respect to such Fronted Delayed Draw Term Loans for all purposes hereof and the Administrative Agent
shall be entitled to retain the Delayed Draw Upfront Fee. Each Lender hereby irrevocably appoints the Administrative Agent
(such appointment being coupled with an interest) as such Lender’s attorney-in-fact, with full authority in the place and stead of
such Lender and in the name of such Lender, from time to time in the Administrative Agent’s discretion, with prior written notice
to such Lender, to take any action and to execute any such Assignment and Assumption or other instrument that the
Administrative Agent may deem reasonably necessary to carry out the provisions of this clause. To the extent that the
Administrative Agent has funded Fronted Delayed Draw Term Loans on behalf of any Unfunded DDTL Commitment Lender,
such Unfunded DDTL Commitment Lender shall not constitute a Defaulting Lender pursuant to clause (a) of the definition
thereof.
Section 2.04
Prepayments
.
(a)
Optional.
(i)
The Borrower may, upon notice to the Administrative Agent in the form of a Prepayment Notice, at any time
or from time to time, voluntarily prepay the Loans in whole or in part without premium or penalty, subject to clause ((D)) below;
provided that:
(A)
such Prepayment Notice must be received by the Administrative Agent (1) not later than 1:00 p.m.
(or such later time as may be agreed by the Administrative Agent in its reasonable discretion) (New York City time in
the case of Loans denominated in Dollars, or London time in the case of Loans denominated in an Alternative
Currency) three Business Days prior to any date of prepayment of Eurocurrency Rate Loans and (2) not later than 1:00
p.m. (or such later time as may be agreed by the Administrative Agent in its reasonable discretion) one Business Day
prior to any date of prepayment of Base Rate Loans;
(B)
any prepayment of Eurocurrency Rate Loans shall be in a principal amount of $1,000,000 or a
whole multiple of $100,000 in excess thereof or, if less, the entire principal amount thereof then outstanding;
(C)
any prepayment of Base Rate Loans shall be in a principal amount of $1,000,000 or a whole
multiple of $100,000 in excess thereof or, if less, the entire principal amount thereof then outstanding (it being
understood that Base Rate Loans shall be denominated in Dollars only); and
(D)
any prepayment of Initial Term Loans or Delayed Draw Term Loans made on or prior to the date
that is twelve months after the Closing Date shall be accompanied by the payment of the fee described in Section
2.08(d), if applicable.
Each Prepayment Notice shall specify the date and amount of such prepayment and the Class(es) and Type(s) of Loans to be prepaid, and the
payment amount specified in each Prepayment Notice shall be due and payable on the date specified therein. The Administrative Agent will
promptly notify each Appropriate Lender of its receipt of a Prepayment Notice and of the amount of such Lender’s Pro Rata Share of such
prepayment; provided, “non-consenting” Lenders may be repaid on a non-pro rata basis in connection with an Extension Offer or a
Refinancing Amendment and Disqualified Lenders or Net Short Lenders may be repaid on non-pro rata basis. Any prepayment of Loans
shall be subject to Section 2.04(c).
(ii)
Notwithstanding anything to the contrary contained in this Agreement, the Borrower may rescind, in whole
or in part, any notice of prepayment under Section 2.04(a)(i), if
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such prepayment would have resulted from a refinancing of all or a portion of the applicable Facility which refinancing shall not
be consummated or shall otherwise be delayed.
(iii)
Voluntary prepayments of Term Loans permitted hereunder shall be applied in a manner determined at the
discretion of the Borrower and specified in the notice of prepayment (and absent such direction, in direct order of maturity) and
may be applied to any Class or Classes of Term Loans at the sole discretion of the Borrower.
(iv)
Notwithstanding anything in any Loan Document to the contrary (including Section 2.12), (A) the Borrower
may prepay the outstanding Term Loans of any Lender on a non-pro rata basis at or below par with the consent of only such
Lender and (B) the Borrower may prepay Term Loans of one or more Classes below par on a non-pro rata basis in accordance
with the auction procedures set forth on Exhibit L; provided that, in each case, no Event of Default has occurred and is continuing
or would result therefrom and if the proceeds of loans under the ABL Credit Facility are used to finance such prepayment,
immediately after giving effect to such prepayment and on a Pro Forma Basis for such prepayment, the Payment Conditions have
been satisfied.
(b)
Mandatory.
(i)
Excess Cash Flow. Within five Business Days after financial statements have been delivered or are required
to be delivered pursuant to Section 6.01(a) and the related Compliance Certificate has been delivered or is required to be delivered
pursuant to Section 6.02(a), in each case, commencing with the first full fiscal year ending after the Closing Date, the Borrower
shall, subject to Section 2.04(b)(iv) and Section 2.04(b)(v), prepay an aggregate principal amount of Initial Term Loans, Delayed
Draw Term Loans and any other Term Loans (unless such prepayment is not required pursuant to the terms of such other Term
Loans) equal to,
(A)
the ECF Prepayment Percentage of Excess Cash Flow, if any, for the fiscal year covered by such
financial statements, minus
(B)
the sum, without duplication, of,
(I)
all voluntary prepayments of Term Loans and any other Pari Passu Lien Debt (including
(A) those made through debt buybacks and in the case of below-par repurchases in an amount equal to the
discounted amount actually paid in cash in respect of such below-par repurchase, (B) cash payments by the
Borrower pursuant to Section 3.07 or other applicable “yank-a-bank” provisions (solely to the extent the
applicable Term Loans or other Pari Passu Lien Debt is retired instead of assigned) and (C) prepayments of
Loans and Participations held by Disqualified Lenders or Net Short Lenders) and
(II)
all voluntary payments and prepayments of loans under the ABL Credit Facility and any
other revolving loans, in each case to the extent accompanied by a corresponding permanent reduction in
commitments.
in each case, (I) during such fiscal year or following the end of such fiscal year and prior to the date of such calculation (provided that, with
respect to any such amount following the end of such fiscal year, such amount is not included in any calculation pursuant to this
Section 2.04(b)(i) for the subsequent fiscal year), (II) to the extent such prepayments are not funded with the proceeds of Funded Debt and
(III) including, for the avoidance of doubt, assignments of such Indebtedness to the Borrower or a Restricted Subsidiary
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(and prepayments of such Indebtedness below par) to the extent of the amount paid in connection with such assignment (or prepayment);
provided that no such payment shall be required if such amount is equal to or less than the greater of 5.00% of Closing Date EBITDA and
5.00% of TTM Consolidated Adjusted EBITDA and only amounts in excess of such minimum will be subject to the repayment provisions of
this Section 2.04(b); provided further that if at the time that any such prepayment would be required, the Borrower is required to repay or
repurchase or to offer to repurchase or repay Pari Passu Lien Debt or other secured debt pursuant to the terms of the documentation
governing such Indebtedness with all or a portion of such Excess Cash Flow (such Pari Passu Lien Debt or other secured debt required to be
repaid or repurchased or to be offered to be so repaid or repurchased, “Other Applicable ECF Indebtedness”), then the Borrower may
apply such Excess Cash Flow on a pro rata basis to the prepayment of the Term Loans and to the repayment or re-purchase of Other
Applicable ECF Indebtedness, and the amount of prepayment of the Term Loans that would have otherwise been required pursuant to this
Section 2.04(b)(i) shall be reduced accordingly (for purposes of this proviso pro rata basis shall be determined on the basis of the aggregate
outstanding principal amount of the Term Loans and Other Applicable ECF Indebtedness at such time, with it being agreed that the portion of
Excess Cash Flow allocated to the Other Applicable ECF Indebtedness shall not exceed the amount of such Excess Cash Flow required to be
allocated to the Other Applicable ECF Indebtedness pursuant to the terms thereof, and the remaining amount, if any, of such net proceeds
shall be allocated to the Term Loans in accordance with the terms hereof).
(ii)
Asset Sales; Casualty Events. If,
(A)
after the Closing Date, the Borrower or any Loan Party disposes of any property or assets pursuant
to the General Asset Sale Basket (other than Dispositions in the ordinary course of business),
(B)
after the Closing Date, any Casualty Event occurs,
(C)
prior to, or after the Closing Date, the Borrower, any Loan Party or any Restricted Subsidiary, if
required by any Governmental Authority in connection with the Acquisition, disposes of the mill located in Kamloops,
British Columbia, Canada,
which, in either case, results in the realization or receipt by the Borrower or such Loan Party or Restricted Subsidiary of Net Cash Proceeds,
the Borrower shall prepay on or prior to the date which is ten Business Days after the date of the realization or receipt of such Net Cash
Proceeds (or, if later, with respect to clause (C) above, ten Business Days after the Closing Date) in excess of the greater of 2.50% of Closing
Date EBITDA and 2.50% of TTM Consolidated Adjusted EBITDA for any transaction or series of related transactions, subject to
Sections 2.04(b)(iv) and 2.04(b)(v), an aggregate principal amount of Initial Term Loans, Delayed Draw Term Loans and any other Term
Loans (unless such prepayment is not required pursuant to the terms of such other Term Loans) equal to 100% of such Net Cash Proceeds
realized or received; provided that if at the time that any such prepayment would be required, the Borrower is required to repay or repurchase
or to offer to repurchase or repay Pari Passu Lien Debt (including the Senior Secured Notes) or other secured debt pursuant to the terms of
the documentation governing such Indebtedness with the proceeds of such Disposition or Casualty Event (such Pari Passu Lien Debt or other
secured debt required to be repaid or repurchased or to be offered to be so repaid or repurchased, “Other Applicable Indebtedness”), then
the Borrower may apply such Net Cash Proceeds on a pro rata basis to the prepayment of the Term Loans and to the repayment or repurchase
of Other Applicable Indebtedness, and the amount of prepayment of the Term Loans that would have otherwise been required pursuant to this
Section 2.04(b)(ii) shall be reduced accordingly (for purposes of this proviso pro rata basis shall be determined on the basis of the aggregate
outstanding principal amount of the Term Loans and Other Applicable Indebtedness at such time, with it being agreed that the portion of such
net proceeds allocated to the Other Applicable Indebtedness shall not exceed the amount of such net proceeds required to be
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allocated to the Other Applicable Indebtedness pursuant to the terms thereof, and the remaining amount, if any, of such net proceeds shall be
allocated to the Term Loans in accordance with the terms hereof); provided further that to the extent the holders of Other Applicable
Indebtedness decline to have such indebtedness repurchased or prepaid, the declined amount shall promptly (and in any event within ten
Business Days after the date of such rejection) be applied to prepay the Term Loans in accordance with the terms hereof; provided further
that no prepayment shall be required pursuant to this Section 2.04(b)(ii) with respect to such portion of such Net Cash Proceeds that the
Borrower intends to or may reinvest in accordance with this Section 2.04(b)(ii).
With respect to any Net Cash Proceeds realized or received with respect to any Disposition or any Casualty Event that, in either
case, is subject to the application of the foregoing provisions of this Section 2.04(b)(ii), at the option of the Borrower or any of the Restricted
Subsidiaries, the Borrower or any of its Restricted Subsidiaries may (in lieu of making a prepayment pursuant to the foregoing provisions)
elect to reinvest an amount equal to all or any portion of such Net Cash Proceeds in any assets used or useful for the business of the Borrower
and the Restricted Subsidiaries within twelve months following receipt of such Net Cash Proceeds (or, if later, with respect to clause (C)
above, twelve months following the Closing Date) or if the Borrower or any of the Restricted Subsidiaries enters into a legally binding
commitment to reinvest such Net Cash Proceeds within twelve months following receipt of such Net Cash Proceeds, no later than one
hundred and eighty days after the end of such twelve month period; provided that if any portion of such amount is not so reinvested by such
dates, subject to Section 2.04(b)(iv) and Section 2.04(b)(v), an amount equal to 100% of any such Net Cash Proceeds shall be applied within
five Business Days after such dates to the prepayment of the Term Loans and Other Applicable Indebtedness as set forth above.
(iii)
Indebtedness. If any of the Borrower or any Restricted Subsidiary incurs or issues any Funded Debt that is
not expressly permitted to be incurred or issued pursuant to Section 7.03, the Borrower shall prepay an aggregate principal amount
of Initial Term Loans, Delayed Draw Term Loans and any other Term Loans (unless such prepayment is not required pursuant to
the terms of such other Term Loans) equal to 100% of all Net Cash Proceeds received therefrom on or prior to the date which is
five Business Days after the receipt of such Net Cash Proceeds.
(iv)
Application of Payments. (A) Except as may otherwise be set forth in any Refinancing Amendment,
Extension Amendment or any Incremental Amendment, each prepayment of Term Loans pursuant to Section 2.04(b)(i), (ii) or (iii)
shall be applied ratably to each Class of Term Loans then outstanding (provided, that any prepayment of Term Loans with the Net
Cash Proceeds of Credit Agreement Refinancing Indebtedness shall be applied solely to each applicable Class of refinanced debt),
(B) with respect to each Class of Loans, each prepayment pursuant to clauses (i) through (iii) of this Section 2.04(b) shall be
applied to remaining scheduled installments of principal thereof following the date of prepayment as directed by the Borrower and
specified in the notice of prepayment (and absent such direction, in direct order of maturity of the remaining installments under the
applicable Class of Loans), and (C) each such prepayment shall be paid to the Lenders in accordance with their respective Pro
Rata Shares of such prepayment.
(v)
Foreign and Tax Considerations. Notwithstanding any other provisions of this Section 2.04(b),
(A)
to the extent that any or all of the Net Cash Proceeds of any Disposition by a Foreign Subsidiary
giving rise to a prepayment event pursuant to Section 2.04(b)(ii) (a “Foreign Disposition”), the Net Cash Proceeds of
any Casualty Event from a Foreign Subsidiary (a “Foreign Casualty Event”) or Excess Cash Flow of a Foreign
Subsidiary are prohibited or delayed by applicable local law from being repatriated to the United
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States, the portion of such Net Cash Proceeds or Excess Cash Flow so affected will not be required to be applied to
repay Term Loans at the times provided in this Section 2.04(b) but may be retained by the applicable Foreign
Subsidiary so long as the applicable local law will not permit repatriation to the United States (the Borrower hereby
agreeing to cause the applicable Foreign Subsidiary to use its commercially reasonable efforts to promptly take all
actions reasonably required by the applicable local law to permit such repatriation) and, if within 12 months of the
applicable prepayment event, such repatriation of any of such affected Net Cash Proceeds or Excess Cash Flow is
permitted under the applicable local law, such repatriation will be immediately effected and such repatriated Net Cash
Proceeds or Excess Cash Flow will be promptly (and in any event not later than ten Business Days after such
repatriation) applied (net of additional taxes payable or reserved against as a result thereof) to the repayment of the
Term Loans pursuant to this Section 2.04(b) to the extent provided herein, and
(B)
to the extent that the Borrower has determined in good faith and in consultation with the
Administrative Agent that repatriation to the United States of any or all of the Net Cash Proceeds of any Foreign
Disposition or any Foreign Casualty Event or any or all of the Excess Cash Flow of a Foreign Subsidiary would have
material adverse tax consequences (relative to the relevant Foreign Disposition, Foreign Casualty Event or Excess Cash
Flow and taking into account any foreign tax credit or benefit actually realized in connection with such repatriation)
with respect to such Net Cash Proceeds or Excess Cash Flow, the Net Cash Proceeds or Excess Cash Flow so affected
may be retained by the applicable Foreign Subsidiary; provided that (I) the Borrower shall use commercially reasonable
efforts to eliminate or reduce such material adverse tax consequences to permit such repatriation to be effected and (II)
to the extent that within 12 months of the applicable prepayment event, the repatriation of any Net Cash Proceeds or
Excess Cash Flow from such Foreign Subsidiary would no longer have material adverse tax consequences (relative to
the relevant Foreign Disposition, Foreign Casualty Event or Excess Cash Flow), such repatriation will be immediately
effected and such repatriated Net Cash Proceeds or Excess Cash Flow will be promptly (and in any event not later than
two Business Days after such repatriation) applied (net of additional taxes payable or reserved against as a result
thereof) to the pro rata prepayment of the Loans pursuant to Section 2.04(d).
(vi)
Mandatory Prepayment Procedures; Declining Lenders. The Borrower shall give notice
the
Administrative Agent of any mandatory prepayment of the Loans pursuant to Section 2.04(b) by 11:00 a.m. at least three Business
Days (or such shorter period as reasonably agreed by the Administrative Agent) prior to the date on which such payment is
due. Such notice shall state that the Borrower is offering to make or will make such mandatory prepayment on or before the date
specified in Section 2.04(b), as the case may be (each, a “Prepayment Date”). Once given, such notice shall be irrevocable
(provided that the Borrower may rescind any notice of prepayment if such prepayment would have resulted from a refinancing of
all or any portion of the applicable Facility or been made in connection with a Disposition, which refinancing or Disposition shall
not be consummated or shall otherwise be delayed) and all amounts subject to such notice shall be due and payable on the
Prepayment Date (except as otherwise provided in Section 2.04(b)(v) and in the last sentence of this Section 2.04(b)(vi)). Upon
receipt by the Administrative Agent of such notice, the Administrative Agent shall immediately give notice to each Lender of the
prepayment, the Prepayment Date and of such Lender’s Pro Rata Share of the prepayment. Each Lender may elect (in its sole
discretion) to decline all (but not less than all) of its Pro Rata Share of any mandatory prepayment by giving notice of such
election in writing to the Administrative Agent by 11:00 a.m., on the date that is one Business Day after the date of such Lender’s
receipt of notice from the Administrative Agent regarding such prepayment. If a Lender
to
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fails to deliver a notice of election declining receipt of its Pro Rata Share of such mandatory prepayment to the Administrative
Agent within the time frame specified above, any such failure will be deemed to constitute an acceptance of such Lender’s Pro
Rata Share of the total amount of such mandatory prepayment of Term Loans. Upon receipt by the Administrative Agent of such
notice, the Administrative Agent shall immediately notify the Borrower of such election. Any amount so declined by any Lender
shall be retained by the Borrower and the Restricted Subsidiaries and/or applied by the Borrower or any of the Restricted
Subsidiaries in any manner not inconsistent with the terms of this Agreement.
(c)
Interest, Funding Losses, Etc. All prepayments under this Section 2.04 shall be accompanied by all accrued interest
thereon, together with, in the case of any such prepayment of a Eurocurrency Rate Loan on a date prior to the last day of an Interest Period
therefor, any amounts owing in respect of such Eurocurrency Rate Loan pursuant to Section 3.05.
(d)
Application of Prepayment Amounts. In the event that the obligation of the Borrower to prepay the Loans shall arise
pursuant to Section 2.04(b), the Borrower shall prepay the outstanding principal amount of the Term Loans in the amount of such prepayment
obligation within the applicable time periods specified in Section 2.04(b), with such prepayment to be applied in the manner set forth in
Section 2.04(b)(iv).
Each payment or prepayment pursuant to the provisions of Section 2.04(b) shall be applied ratably among the Lenders of each Class holding
the Loans being prepaid, in proportion to the principal amount held by each, and shall be applied as among the Term Loans being prepaid,
(A) first, to prepay all Base Rate Loans and (B) second, to the extent of any excess remaining after application as provided in clause (A)
above, to prepay all Eurocurrency Rate Loans (and as among Eurocurrency Rate Loans, (1) first to prepay those Eurocurrency Rate Loans, if
any, having Interest Periods ending on the date of such prepayment, and (2) thereafter, to the extent of any excess remaining after application
as provided in clause (1) above, to prepay any Eurocurrency Rate Loans in the order of the expiration dates of the Interest Periods applicable
thereto).
Section 2.05
Termination or Reduction of Commitments
.
(a)
Optional. The Borrower may, upon written notice to the Administrative Agent, terminate the unused Commitments of
any 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 one Business Day prior to the date of termination or reduction
and (ii) any such partial reduction shall be in an aggregate amount of $1,000,000 or any whole multiple of $500,000 in excess thereof or, if
less, the entire amount thereof. Notwithstanding the foregoing, the Borrower may rescind or postpone any notice of termination of the
Commitments if such termination would have resulted from a refinancing of all or a portion of the applicable Facility, which refinancing shall
not be consummated or otherwise shall be delayed.
(b)
Mandatory. (A) The Initial Term Loan Commitment of each Lender shall be automatically and permanently reduced to
$0 upon the making of such Lender’s Initial Term Loans pursuant to Section 2.01(a) and (B) the Delayed Draw Commitment of each Lender
shall be automatically and permanently reduced (x) by the aggregate principal amount of Delayed Draw Term Loans made by such Lender
pursuant to Section 2.01(a) and (y) to $0 upon the Delayed Draw Commitment Termination Date.
(c)
The Borrower may, upon notice to the Administrative Agent, terminate the Delayed Draw Commitments or from time
to time permanently reduce the Delayed Draw Commitments; provided that (i) any such notice shall be received by the Administrative Agent
not later than 1:00 p.m. three Business Days prior to the date of termination or reduction, (ii) any such notice shall be irrevocable, and
(iii) any
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such partial reduction shall be in an aggregate amount of $5,000,000 or any whole multiple of $1,000,000 in excess thereof.
(d)
Effect of Termination or Reduction. Any termination or reduction of the Commitments of any Class shall be
permanent. Each reduction of Commitments of any Class shall be made ratably among the Lenders in accordance with their respective Pro
Rata Share of Commitments of such Class.
Section 2.06
Repayment of Loans
.
(a)
The Borrower shall repay to the Administrative Agent for the ratable account of the Appropriate Lenders
(i)
on the last Business Day of each fiscal quarter (commencing with the first full fiscal quarter ending after the
Closing Date) an aggregate principal amount equal to (x) until the quarter ending December 31, 2022, 0.25% of the aggregate
principal amount of all Initial Term Loans outstanding on the Closing Date and (y) from and after the fiscal quarter ending March
31, 2023, 1.25% of the aggregate principal amount of all Initial Term Loans outstanding on the Closing Date (which payments
shall be reduced as a result of the application of prepayments in accordance with the order of priority set forth in Section 2.04);
provided that (x) to the extent funded, any Delayed Draw Term Loans also shall amortize from and after the Delayed Draw
Closing Date in an aggregate principal amount equal to (x) until the quarter ending December 31, 2022, 0.25% of the aggregate
principal amount thereof funded on the Delayed Draw Closing Date and (y) from and after the fiscal quarter ending March 31,
2023, 1.25% of the aggregate principal amount thereof funded on the Delayed Draw Closing Date (which shall commence with
the end of the fiscal quarter in which the Delayed Draw Closing Date occurs unless such Delayed Draw Closing Date is the last
day of a fiscal quarter, in which case such amortization shall commence with the next succeeding fiscal quarter) and (y) (A) at the
election of the Borrower this clause (i) shall be amended, as it relates to any then-existing tranche of Term Loans to increase the
amortization with respect thereto, in connection with the Borrowing of any Incremental Term Loans that constitute Pari Passu Lien
Debt and/or the Borrowing of any Delayed Draw Term Loans if and to the extent necessary so that such Incremental Term Loans
and/or Delayed Draw Term Loans and the applicable existing Term Loans form the same Class of Term Loans and to the extent
possible, a “fungible” tranche, in each case, without the consent of any party hereto, and (B) such amendments shall not decrease
any amortization payment to any Lender that would have otherwise been payable to such Lender prior thereto, and
(ii)
outstanding on such date.
on the Maturity Date for each Class of Term Loans, the aggregate principal amount of all such Term Loans
Section 2.07
Interest
.
(a)
Subject to the provisions of Section 2.07(a)(i),
(i)
each Eurocurrency Rate Loan shall bear interest on the outstanding principal amount thereof for each Interest
Period at a rate per annum equal to the Adjusted Eurocurrency Rate for such Interest Period plus the Applicable Rate; and
(ii)
each Base Rate Loan shall bear interest on the outstanding principal amount thereof from the applicable
Borrowing date at a rate per annum equal to the Base Rate plus the Applicable Rate.
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(b)
If any amount of principal of any Loan is not paid when due (without regard to any applicable grace periods), whether
at stated maturity, by acceleration or otherwise, such amount shall thereafter bear interest at a fluctuating interest rate per annum at all times
equal to the Default Rate to the fullest extent permitted by applicable Laws.
(c)
If any amount (other than principal of any Loan) payable by the Borrower under any Loan Document is not paid when
due (without regard to any applicable grace periods), whether at stated maturity, by acceleration or otherwise, then upon the request of the
Required Lenders (or, after the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under the
Bankruptcy Code or any other Debtor Relief Law, automatically and without further action by the Administrative Agent or any Lender) such
amount shall thereafter bear interest at a fluctuating interest rate per annum at all times equal to the Default Rate to the fullest extent
permitted by applicable Laws.
(d)
Accrued and unpaid interest on the principal amount of all outstanding past due Obligations (including interest on past
due interest) shall be due and payable upon demand (or, after the occurrence of an actual or deemed entry of an order for relief with respect to
the Borrower under the Bankruptcy Code or any other Debtor Relief Law, automatically and without further action by the Administrative
Agent or any Lender).
(e)
Interest on each Loan shall be due and payable (i) with respect to Base Rate Loans, in arrears on each Interest Payment
Date applicable thereto and at such other times as may be specified herein and (ii) with respect to Eurocurrency Rate Loans, at the end of
each Interest Period, and, in any event, every three months. Interest hereunder shall be due and payable in accordance with the terms hereof
before and after judgment, and before and after the commencement of any proceeding under any Debtor Relief Law.
(f)
The Administrative Agent shall promptly notify the Borrower and the Lenders of the interest rate applicable to any
Interest Period for any Eurocurrency Rate Loans upon determination of such interest rate. The determination of the Adjusted Eurocurrency
Rate and the Eurocurrency Rate by the Administrative Agent shall be conclusive in the absence of manifest error. At any time when Base
Rate Loans are outstanding, the Administrative Agent shall notify the Borrower and the Lenders of any change in the “prime rate” used in
determining the Base Rate promptly following the public announcement of such change.
(g)
After giving effect to all Borrowings, all conversions of Loans from one Type to the other, and all continuations of
Loans as the same Type, there shall not be more than ten Interest Periods in effect unless otherwise agreed between the Borrower and the
Administrative Agent; provided that after the establishment of any new Class of Loans pursuant to a Refinancing Amendment or Extension,
the number of Interest Periods otherwise permitted by this Section 2.07(d) shall increase by three Interest Periods for each applicable Class so
established.
Section 2.08
Fees
.
(a)
The Borrower shall pay to the Agents such fees as shall have been separately agreed upon in writing (including
pursuant to any fee letter executed with the Agents in connection with the Term Loans) in the amounts and at the times so specified. Such
fees shall be fully earned when due and shall not be refundable for any reason whatsoever (except as expressly agreed between the Borrower
and the applicable Agent).
(b)
The Borrower agrees to pay on the Closing Date to each Lender party to this Agreement on the Closing Date, as fee
compensation for the funding of such Lender’s Initial Term Loan, a closing fee (the “Closing Fee”) in an amount equal to 1.00% of the stated
principal amount of such Lender’s Term
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Loan made on the Closing Date. The Closing Fee will be in all respects fully earned, due and payable on the Closing Date and non-
refundable and non-creditable thereafter and the Closing Fee may be netted against Initial Term Loans (in the form of OID) made by such
Lender. In addition, with respect to each advance of Delayed Draw Term Loans made in accordance with Section 2.01(a), the Borrower
agrees to pay to the Administrative Agent, for the ratable account of each Lender with a Delayed Draw Commitment, an upfront fee (the
“Delayed Draw Upfront Fee”) in an amount equal to 1.00% of the stated principal amount of such Delayed Draw Term Loans that are made
on such Delayed Draw Closing Date. Such Delayed Draw Upfront Fee will be in all respects fully earned, due and payable on the date on
which such Delayed Draw Term Loans are made and shall be non-refundable thereafter, and such Delayed Draw Upfront Fee shall be netted
against the Delayed Draw Term Loans (in the form of original issue discount) made by such Lender on such Delayed Draw Closing Date.
(c)
The Borrower agrees to pay to the Administrative Agent for its own account the fees payable in the amounts and at the
times separately agreed upon.
(d)
At the time of the effectiveness of any Repricing Event that is consummated during the period commencing on the
Closing Date and ending on the day immediately prior to the date that is twelve months after the Closing Date, the Borrower agrees to pay to
the Administrative Agent, for the ratable account of each lender with Initial Term Loans or Delayed Draw Term Loans that are either repaid,
converted or subjected to a pricing reduction in connection with such Repricing Event (including each Lender that withholds its consent to
such Repricing Event and is replaced as a Non-Consenting Lender under Section 3.07), a fee in an amount equal to 1.00% of (i) in the case of
a Repricing Event described in clause (a) of the definition thereof, the aggregate principal amount of all Initial Term Loans and Delayed
Draw Term Loans prepaid (or converted) in connection with such Repricing Event and (ii) in the case of a Repricing Event described in
clause (b) of the definition thereof, the aggregate principal amount of all Initial Term Loans and Delayed Draw Term Loans outstanding on
such date that are subject to an effective pricing reduction pursuant to such Repricing Event. Such fees shall be earned, due and payable upon
the date of the effectiveness of such Repricing Event. Notwithstanding anything to the contrary in the Loan Documents, each Lender hereby
agrees to waive any amounts payable by the Borrower pursuant to Section 3.05 that would have resulted from a refinancing of this
Agreement or a Repricing Event.
(e)
The Borrower agrees to pay to Lenders (other than any Defaulting Lender) having Delayed Draw Commitments a
ticking fee (the “Delayed Draw Ticking Fee”) during the Delayed Draw Commitment Period, calculated in an amount equal to the average
daily balance of the unfunded and outstanding Delayed Draw Commitments, multiplied by a per annum rate (calculated in accordance with
Section 2.12) equal to (x) for any day in the period from and including the Closing Date to and including the date that is 30 days after the
Closing Date, 0%, (y) for any day in the period from and including the date that is 31 days after the Closing Date to and including the date
that is 60 days after the Closing Date, 50% of the Applicable Rate for Eurocurrency Rate Loans then in effect with respect to Initial Term
Loans and (z) for any day in the period from and including the date that is 61 days after the Closing Date to but excluding the Delayed Draw
Commitment Termination Date, 100% of the Applicable Rate for Eurocurrency Rate Loans then in effect with respect to Initial Term
Loans. Subject to the following sentence, the Delayed Draw Ticking Fee shall accrue on unfunded and outstanding Delayed Draw
Commitments from and including the Closing Date and shall be due and payable in arrears on the earlier of (x) the Delayed Draw Closing
Date and (y) the Delayed Draw Commitment Termination Date. The Delayed Draw Ticking Fee also shall be due and payable on each
Delayed Draw Closing Date solely to the extent of the Delayed Draw Commitments funded as Delayed Draw Term Loans on such Delayed
Draw Closing Date (and such payment shall not affect the accrual of the Delayed Draw Ticking Fee or timing of payment thereof on the
remaining unfunded and outstanding Delayed Draw Commitments pursuant to the foregoing sentence).
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Section 2.09
Computation of Interest and Fees
. All computations of interest for Base Rate Loans and for the Delayed Draw Ticking Fee shall be made on the basis of a year of
365 days or 366 days, as the case may be, and actual days elapsed. All other computations of fees and interest shall be made on the basis of a
360-day year and actual days elapsed (which results in more fees or interest, as applicable, being paid than if computed on the basis of a 365-
day year). Interest shall accrue on each Loan for the day on which the Loan is made, and shall not accrue on a Loan, or any portion thereof,
for the day on which the Loan or such portion is paid; provided that any Loan that is repaid on the same day on which it is made shall, subject
to Section 2.07(a), bear interest for one day. Each determination by the Administrative Agent of an interest rate or fee hereunder shall be
conclusive and binding for all purposes, absent manifest error.
Section 2.10
Evidence of Indebtedness
.
(a)
The Borrowings made by each Lender shall be evidenced by one or more accounts or records maintained by such
Lender and evidenced by one or more entries in the Register maintained by the Administrative Agent, acting solely for purposes of Treasury
Regulation Section 5f.103-1(c), as non-fiduciary agent for the Borrower, in each case in the ordinary course of business. The accounts or
records maintained by the Administrative Agent and each Lender shall be prima facie evidence absent manifest error of the amount of the
Borrowings made by the Lenders to the Borrower and the interest and payments thereon. Any failure to so record or any error in doing so
shall not, however, limit or otherwise affect the obligation of the Borrower hereunder to pay any amount owing with respect to the
Obligations. In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the
Administrative Agent in respect of such matters, the accounts and records of the Administrative Agent shall control in the absence of
manifest error.
(b)
Upon the request of any Lender made through the Administrative Agent, the Borrower shall execute and deliver to such
Lender (through the Administrative Agent) a Note payable to such Lender, which shall evidence the relevant Class of such Lender’s Loans in
addition to such accounts or records. Each Lender may attach schedules to its Note and endorse thereon the date, Type (if applicable),
amount and maturity of its Loans and payments with respect thereto.
(c)
Entries made in good faith by the Administrative Agent in the Register pursuant to Section 2.10(a), and by each Lender
in its account or accounts pursuant to Section 2.10(a), shall be prima facie evidence of the amount of principal and interest due and payable
or to become due and payable from the Borrower to, in the case of the Register, each Lender and, in the case of such account or accounts,
such Lender, under this Agreement and the other Loan Documents, absent manifest error; provided that the failure of the Administrative
Agent or such Lender to make an entry, or any finding that an entry is incorrect, in the Register or such account or accounts shall not limit or
otherwise affect the obligations of the Borrower under this Agreement and the other Loan Documents.
Section 2.11
Payments Generally
.
(a)
All payments to be made by the Borrower shall be made on the date when due, in immediately available funds without
condition or deduction for any counterclaim, defense, recoupment or setoff. Except as otherwise expressly provided herein, all payments by
the Borrower hereunder shall be made to the Administrative Agent, for the account of the respective Lenders to which such payment is owed,
at the applicable Administrative Agent’s Office for payment and in Same Day Funds not later than 1:00 p.m. (New York City time) in the
case of any payment in Dollars and not later than 1:00 p.m. (London time) in the case of any payment in an Alternative Currency, in each
case, on the date specified herein. The Administrative Agent will promptly distribute to each Appropriate Lender its Pro Rata Share (or other
applicable share as provided herein) of such payment in like funds as received by wire transfer to such Lender’s Lending Office. All
payments received by the Administrative Agent (i) after 1:00 p.m. (New
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York City time) in the case of payments in Dollars, (ii) after 1:00 p.m. (London time) in the case of payments in an Alternative Currency,
shall, in each case, shall in each case be deemed received on the next succeeding Business Day and any applicable interest or fee shall
continue to accrue.
(b)
If any payment to be made by the Borrower shall come due on a day other than a Business Day, payment shall be made
on the next following Business Day, and such extension of time shall be reflected in computing interest or fees, as the case may be.
(c)
Unless the Borrower has notified the Administrative Agent, prior to the date any payment is required to be made by it
to the Administrative Agent hereunder for the account of any Lender that the Borrower will not make such payment, the Administrative
Agent may assume that the Borrower has timely made such payment and may (but shall not be so required to), in reliance thereon, make
available a corresponding amount to such Lender. If and to the extent that such payment was not in fact made to the Administrative Agent in
Same Day Funds, then such Lender shall forthwith on demand repay to the Administrative Agent the portion of such assumed payment that
was made available to such Lender in Same Day Funds, together with interest thereon in respect of each day from and including the date such
amount was made available by the Administrative Agent to such Lender to the date such amount is repaid to the Administrative Agent in
Same Day Funds at the applicable Overnight Rate from time to time in effect.
(d)
If any Lender makes available to the Administrative Agent funds for any Loan to be made by such Lender as provided
in the foregoing provisions of this Article II, and such funds are not made available to the Borrower by the Administrative Agent because the
conditions to the Borrowing set forth in Article IV are not satisfied or waived in accordance with the terms hereof, the Administrative 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 make payments pursuant to Section 9.07 are several
and not joint. The failure of any Lender to make any Loan on any date required hereunder shall not relieve any other Lender of its
corresponding obligation to do so on such date, and no Lender shall be responsible for the failure of any other Lender to so make its 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 or
manner or to constitute a representation by any Lender that it has obtained or will obtain the funds for any Loan in any particular place or
manner.
(g)
Whenever any payment received by the Administrative Agent under this Agreement or any of the other Loan
Documents is insufficient to pay in full all amounts due and payable to the Administrative Agent and the Lenders under or in respect of this
Agreement and the other Loan Documents on any date, such payment shall be distributed by the Administrative Agent and applied by the
Administrative Agent and the Lenders in the order of priority set forth in Section 8.03. If the Administrative Agent receives funds for
application to the Obligations of the Loan Parties under or in respect of the Loan Documents under circumstances for which the Loan
Documents do not specify the manner in which such funds are to be applied, the Administrative Agent may, but shall not be obligated to,
elect to distribute such funds to each of the Lenders in accordance with such Lender’s Pro Rata Share of such of the outstanding Loans or
other Obligations then owing to such Lender.
(h)
If any Lender shall fail to make any payment required to be made by it pursuant to Section 2.03, Section 2.12 or
Section 9.07, then the Administrative Agent may, in its discretion and notwithstanding any contrary provision hereof, (i) apply any amounts
thereafter received by the Administrative Agent for the account of such Lender for the benefit of the Administrative Agent, as applicable, to
satisfy such Lender’s obligations to such Persons until all such unsatisfied obligations are
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fully paid and/or (ii) hold any such amounts in a segregated account as cash collateral for, and application to, any future funding obligations
of such Lender under any such Section, in the case of each of clauses (i) and (ii) above, in any order as determined by the Administrative
Agent in its discretion.
Section 2.12
Sharing of Payments, Etc.
If, other than as expressly provided elsewhere herein, any Lender shall obtain payment in respect of any principal of or interest
on account of the Loans of a particular Class made by it (whether voluntary, involuntary, through the exercise of any right of
setoff, or otherwise) 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
them , as the case may be, as shall be necessary to cause such purchasing Lender to share the excess payment in respect of such
Loans or such participations, as the case may be, pro rata with each of them; provided that if all or any portion of such excess
payment is thereafter recovered from the purchasing Lender under any of the circumstances described in Section 10.06 (including
pursuant to any settlement entered into by the purchasing Lender in its discretion), such purchase shall to that extent be rescinded
and each relevant Lender shall repay to the purchasing Lender the purchase price paid therefor, together with an amount equal to
such paying Lender’s ratable share (according to the proportion of (i) the amount of such paying Lender’s required repayment to
(ii) the total amount so recovered from the purchasing Lender) of any interest or other amount paid or payable by the purchasing
Lender in respect of the total amount so recovered, without further interest thereon. The provisions of this paragraph shall not be
construed to apply to (A) any payment made by the Borrower pursuant to and in accordance with the express terms of this
Agreement as in effect from time to time (including Section 2.04(a)(iv) and Section 10.07), (B) any payment obtained by a Lender
as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or participant permitted
hereunder or (C) any payment received by such Lender not in its capacity as a Lender. The Borrower agrees that any Lender so
purchasing 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 direct creditor of the Borrower in the amount of such participation. The Administrative Agent will keep records (which
shall be conclusive and binding in the absence of manifest error) of participations purchased under this Section 2.12 and will in
each case notify the Lenders following any such purchases or repayments. Each Lender that purchases a participation pursuant to
this Section 2.12 shall from and after such purchase have the right to give all notices, requests, demands, directions and other
communications under this Agreement with respect to the portion of the Obligations purchased to the same extent as though the
purchasing Lender were the original owner of the Obligations purchased.
Section 2.13
Incremental Borrowings
.
(a)
Notice. At any time and from time to time, on one or more occasions, the Borrower may, by notice to the
Administrative Agent, increase the aggregate principal amount of any outstanding tranche of Term Loans or add one or more additional
tranches of term loans under the Loan Documents (the “Incremental Term Facilities” and the term loans made thereunder, the
“Incremental Term Loans” each such increase or tranche , an “Incremental Facility” and the loans or other extensions of credit made
thereunder, the “Incremental Loans”).
(b)
Ranking. Incremental Facilities (i) may rank either pari passu or junior in right of payment with Term Loans
(including the Initial Term Loans and the Delayed Draw Term Loans), (ii) may either be unsecured or secured by a Permitted Lien (including
secured by Liens that secure the Facilities on a pari passu or junior basis) and (iii) may be guaranteed by the Loan Parties (or Persons that
become Loan Parties substantially concurrently with the incurrence of such Incremental Facility).
(c)
Size and Currency. The aggregate principal amount of Incremental Facilities on any date Indebtedness thereunder is
first incurred (or commitments with respect thereto are received in the case of a
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revolving or delayed draw facility), together with the aggregate principal amount of Incremental Equivalent Debt and other Incremental
Facilities outstanding on such date, will not exceed, an amount equal to,
(i)
(ii)
the Fixed Incremental Amount, plus
the Ratio Amount,
(the sum of the Fixed Incremental Amount and the Ratio Amount, the “Incremental Amount”). Calculation of the Incremental Amount
shall be made on Pro Forma Basis and evidenced by a certificate from a Responsible Officer of the Borrower demonstrating such calculation
in reasonable detail. Each Incremental Facility will be in an integral multiple of $1,000,000 and in an aggregate principal amount that is not
less than $10,000,000 (or such lesser minimum amount approved by the Administrative Agent in its reasonable discretion); provided that
such amount may be less than such minimum amount or integral multiple amount if such amount represents all the remaining availability
under the Incremental Amount at such time. Any Incremental Facility may be denominated in Dollars or in any Alternative Currency (and in
the case of any Alternative Currency, the Dollar Amount thereof as of the date of incurrence (or, in the case of an LCA Election, as of the
applicable LCA Test Date) shall be controlling for purposes of determining compliance with the Incremental Amount, and the minimum
amount and integral multiples shall be a Dollar Amount of $10,000,000 or $1,000,000, respectively (or, in each case, such lesser minimum
amount approved by the Administrative Agent in its reasonable discretion)).
(d)
Incremental Lenders. Incremental Facilities may be provided by any existing Lender (it being understood that no
existing Lender shall have an obligation to make, or provide commitments with respect to, an Incremental Loan) or by any Additional
Lender. While existing Lenders may (but are not obligated to unless invited to and so elect) participate in any syndication of an Incremental
Facility and may (but are not obligated to unless invited to and so elect) become lenders with respect thereto, the existing Lenders will not
have any right to participate in any syndication of, and will not have any right of first refusal or other right to provide all or any portion of,
any Incremental Facility or Incremental Loan except to the extent the Borrower and the arrangers thereof, if any, in their discretion, choose to
invite or include any such existing Lender (which may or may not apply to all existing Lenders and may or may not be pro rata among
existing Lenders). Final allocations in respect of Incremental Facilities will be made by the Borrower together with the arrangers thereof, if
any, in their discretion, on the terms permitted by this Section 2.13; provided that the lenders providing the Incremental Facilities will be
reasonably acceptable to (i) the Borrower and (ii) the Administrative Agent (except that, in the case of clause (ii), only to the extent such
Person otherwise would have a consent right to an assignment of such loans or commitments to such lender, such consent not to be
unreasonably withheld, conditioned or delayed).
(e)
Incremental Facility Amendments; Use of Proceeds. Each Incremental Facility will become effective pursuant to an
amendment (each, an “Incremental Amendment”) to this Agreement and, as appropriate, the other Loan Documents, executed by the
Borrower and each Person providing such Incremental Facility and the Administrative Agent. The Administrative Agent will promptly notify
each Lender as to the effectiveness of each Incremental Amendment. Incremental Amendments may, without the consent of any other
Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary, advisable or appropriate, in the
reasonable opinion of the Borrower in consultation with the Administrative Agent, to effect the provisions of this Section 2.13 and, to the
extent practicable, to make an Incremental Loan fungible (including for Tax purposes) with other Loans (subject to the limitations under sub-
clause ((g)) of this Section). Without limiting the foregoing, an Incremental Amendment may (i) extend or add “call protection” to any
existing tranche of Term Loans, including amendments to Section 2.08(d) to extend or add “call protection,” and (ii) amend the schedule of
amortization payments relating to any existing tranche of Term Loans, including amendments to Section 2.06(a) (provided that any such
amendment shall not decrease any amortization payment to any
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Lender that would have otherwise been payable to such Lender prior to the effectiveness of the applicable Incremental Amendment), in the
case of each clause (i) and (ii), so that such Incremental Term Loans and the applicable existing Term Loans form the same Class of Term
Loans. Each of the parties hereto hereby agrees that, upon the effectiveness of any Incremental Amendment, this Agreement and the other
Loan Documents, as applicable, will be amended to the extent necessary to reflect the existence and terms of the Incremental Facility and the
Incremental Term Loans evidenced thereby. This Section 2.13 shall supersede any provisions in Section 2.12 or Section 10.01 to the
contrary. The Borrower may use the proceeds of the Incremental Loans for any purpose not prohibited by this Agreement.
(f)
Conditions. The availability of Incremental Facilities under this Agreement will be subject solely to the following
conditions, subject, for the avoidance of doubt, to Section 1.08, measured on the date of the initial borrowing under such Incremental Facility
(or in the case of a delayed draw or revolving facility, the receipt of commitments thereunder):
(i)
no Event of Default shall have occurred and be continuing or would result therefrom; provided that the
condition set forth in this clause ((i)) may be waived or not required (other than with respect to Specified Events of Default) by the
Persons providing such Incremental Facilities if the proceeds of the initial Borrowings under such Incremental Facilities will be
used to finance, in whole or in part, a Permitted Investment or other Acquisition Transaction; and
(ii)
the representations and warranties in the Loan Documents will be true and correct in all material respects
(except for representations and warranties that are already qualified by materiality, which representations and warranties will be
true and correct in all respects) immediately prior to, and after giving effect to, the incurrence of such Incremental Facility;
provided that the condition set forth in this clause ((ii)) may be waived or not required (other than with respect to the Specified
Representations) by the Persons providing such Incremental Facilities if the proceeds of the initial Borrowings under such
Incremental Facilities will be used to finance, in whole or in part, a Permitted Investment.
(g)
Terms. Each Incremental Amendment will set forth the amount and terms of the relevant Incremental Facility. The
terms of each Incremental Facility will be as agreed between the Borrower and the Persons providing such Incremental Facility; provided
that:
(i)
the final maturity date of any such Incremental Term Loans will be no earlier than the Latest Maturity Date of
the Initial Term Loans; provided that this clause shall not apply to the incurrence of any Incremental Term Loans pursuant to the
Inside Maturity Exception;
(ii)
the Weighted Average Life to Maturity of any such Incremental Term Loans will be no shorter than the
remaining Weighted Average Life to Maturity of the Initial Term Loans; provided that this clause shall not apply to the incurrence
of any Incremental Term Loans pursuant to the Inside Maturity Exception;
(iii)
any mandatory prepayment of such Incremental Term Loans may participate on a pro rata basis or a less
than pro rata basis in any corresponding required mandatory repayments of the Initial Term Loans, the Senior Secured Notes and
any other Pari Passu Lien Debt, but not on a greater than pro rata basis to the Initial Term Loans, the Senior Secured Notes and
any other Pari Passu Lien Debt (other than (A) any repayment of such Incremental Term Loans at maturity and (B) any greater
than pro rata repayment of such Incremental Term Loans with the proceeds of Credit Agreement Refinancing Indebtedness);
provided that this clause shall not apply to the incurrence of any Incremental Term Loans pursuant to the Inside Maturity
Exception;
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(iv)
(A) to the extent secured, such Incremental Facilities shall not be secured by any Lien on any property or
asset of the Borrower or any Guarantor that does not also secure the Initial Term Loans at the time of such incurrence (except (1)
customary cash collateral in favor of an agent, letter of credit issuer or similar “fronting” lender, (2) Liens on property or assets
applicable only to periods after the Latest Maturity Date of the Term Loans at the time of incurrence, (3) Liens on the proceeds of
such Incremental Facilities funded into escrow pursuant to customary escrow arrangements and (4) any Liens on property or assets
to the extent that a Lien on such property or asset is also added for the benefit of the Lenders under the Term Loans) and (B) to the
extent guaranteed, such Incremental Facilities shall not be incurred or guaranteed by any Loan Party other than the Borrower and
the Guarantors (including any Person required to be a Guarantor) (except (1) for guarantees by other Persons that are applicable
only to periods after the Latest Maturity Date of the Term Loans at the time of incurrence and (2) any such Person incurring or
guaranteeing such Incremental Term Facilities that also guarantees the Term Loans); and
(v)
except as otherwise set forth herein, all terms of any Incremental Facility shall be on terms and pursuant to
documentation to be determined by the Borrower and the providers of the Incremental Term Facility; provided that the operational
and agency provisions contained in such documentation shall be reasonably satisfactory to the Administrative Agent.
(h)
Pricing. The interest rate, fees and OID for any Incremental Term Loans will be as determined by the Borrower and the
Persons providing such Incremental Term Loans; provided that in the event that the All-In Yield applicable to any Incremental Term Loans
that are secured on a pari passu basis with the Initial Term Loans exceeds the All-In Yield (taking into account the leverage-based pricing
grid therein and any comparable leverage-based pricing grid applicable to such Incremental Term Loans) for the Initial Term Loans by more
than 50 basis points, then the interest rate margins for the Initial Term Loans shall be increased to the extent necessary so that the All-In Yield
for such Term Loans is equal to the All-In Yield for such Incremental Term Loans minus 50 basis points.
(i)
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 effected pursuant to Section 2.13.
Section 2.14
Refinancing Amendments
.
(a)
Refinancing Loans. The Borrower may obtain, from any Lender or any Additional Lender, Credit Agreement
Refinancing Indebtedness in respect of all or any portion of the Term Loans , in the form of Refinancing Loans or Refinancing Commitments
made pursuant to a Refinancing Amendment; provided that, for the avoidance of doubt Liens securing Refinancing Loans may be (and must
only be) Permitted Liens.
(b)
Refinancing Amendments. The effectiveness of any Refinancing Amendment will be subject only to the satisfaction on
the date thereof of such conditions as may be requested by the providers of applicable Refinancing Loans. The Administrative Agent will
promptly notify each Lender as to the effectiveness of each Refinancing Amendment. Each of the parties hereto hereby agrees that, upon the
effectiveness of any Refinancing Amendment, this Agreement will be deemed amended to the extent (but only to the extent) necessary to
reflect the existence and terms of the Refinancing Loans incurred pursuant thereto (including any amendments necessary to treat the Term
Loans subject thereto as Refinancing Term Loans).
(c)
Required Consents. Any Refinancing Amendment may, without the consent of any Person other than the
Administrative Agent, the Borrower and the Persons providing the applicable Refinancing
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Loans, effect such amendments to this Agreement and the other Loan Documents as may be necessary, advisable or appropriate, in the
reasonable opinion of the Administrative Agent and the Borrower, to effect the provisions of this Section 2.14. This Section 2.14 supersedes
any provisions in Section 2.12 or Section 10.01 to the contrary.
(d)
Providers of Refinancing Loans. Refinancing Loans may be provided by any existing Lender (it being understood that
no existing Lender shall have an obligation to make all or any portion of any Refinancing Loan) or by any Additional Lender. The lenders
providing the Refinancing Loans will be reasonably acceptable to the (i) Borrower and (ii) the Administrative Agent , only to the extent such
Person otherwise would have a consent right to an assignment of such loans or commitments to such lender, such consent not to be
unreasonably withheld, conditioned or delayed).
Section 2.15
Extensions of Loans
.
(a)
Extension Offers. Pursuant to one or more offers (each, an “Extension Offer”) made from time to time by the
Borrower to all Lenders holding Loans and/or Commitments of a particular Class with a like Maturity Date, the Borrower may extend such
Maturity Date and otherwise modify the terms of such Loans and/or Commitments pursuant to the terms set forth in an Extension Offer
(each, an “Extension”). Each Extension Offer will specify the minimum amount of Loans and/or Commitments with respect to which an
Extension Offer may be accepted, which with respect to Loans or commitments denominated in Dollars, will be an integral multiple of
$1,000,000 and an aggregate principal amount that is not less than $10,000,000, or, if less (i) the aggregate principal amount of such Class of
Loans outstanding or (ii) such lesser minimum amount as is approved by the Administrative Agent, such consent not to be unreasonably
withheld, conditioned or delayed. Extension Offers will be made on a pro rata basis to all Lenders holding Loans and/or Commitments of a
particular Class with a like Maturity Date. If the aggregate outstanding principal amount of such Loans (calculated on the face amount
thereof) and/or Commitments in respect of which Lenders have accepted an Extension Offer exceeds the maximum aggregate principal
amount of Loans and/or Commitments offered to be extended pursuant to such Extension Offer, then the Loans and/or Commitments of such
Lenders will be extended ratably up to such maximum amount based on the respective principal amounts (but not to exceed actual holdings
of record) with respect to which such Lenders have accepted such Extension Offer. There is no requirement that any Extension Offer or
Extension Amendment (defined as follows) be subject to any “most favored nation” pricing provisions. The terms of an Extension Offer shall
be determined by the Borrower, and Extension Offers may contain one or more conditions to their effectiveness as determined by the
Borrower, including a condition that a minimum amount of Loans and/or Commitments of any or all applicable tranches be tendered.
(b)
Extension Amendments. The Lenders hereby irrevocably authorize the Administrative Agent to enter into amendments
to this Agreement and the other Loan Documents (an “Extension Amendment”) as may be necessary, advisable or appropriate in order to
establish new tranches in respect of Extended Loans and Extended Term Commitments and such amendments as permitted by clause ((c))
below as may be necessary, advisable or appropriate in the reasonable opinion of the Borrower, in consultation with the Administrative
Agent, in connection with the establishment of such new tranches of Loans. This Section 2.15 shall supersede any provisions in Section 2.12
or Section 10.01 to the contrary. Except as otherwise set forth in an Extension Offer, there will be no conditions to the effectiveness of an
Extension Amendment. Extensions will not constitute a voluntary or mandatory payment or prepayment for purposes of this Agreement.
(c)
Terms of Extension Offers and Extension Amendments. The terms of any Extended Loans and Extended Term
Commitments will be set forth in an Extension Offer and as agreed between the Borrower and the Extending Lenders accepting such
Extension Offer; provided that:
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(i)
the final maturity date of such Extended Loans and Extended Term Commitments will be no earlier than the
Latest Maturity Date applicable to the Loans and/or Commitments subject to such Extension Offer;
(ii)
the Weighted Average Life to Maturity of any Extended Loans that are Term Loans will be no shorter than
the remaining Weighted Average Life to Maturity of the Term Loans subject to such Extension Offer; and
(iii)
any Extended Loans that are Term Loans may participate on a pro rata basis or a less than pro rata basis
(but not greater than a pro rata basis) in any corresponding mandatory repayments or prepayments of Term Loans other than any
repayment of such Extended Loans at maturity or with the proceeds of Credit Agreement Refinancing Indebtedness.
Any Extended Loans will constitute a separate tranche of Term Loans from the Term Loans held by Lenders that did not accept the applicable
Extension Offer.
(d)
Required Consents. No consent of any Lender or any other Person will be required to effectuate any Extension, other
than the consent of the Administrative Agent (such consent not to be unreasonably withheld, delayed or conditioned), the Borrower and the
applicable Extending Lender. The transactions contemplated by this Section 2.15 (including, for the avoidance of doubt, payment of any
interest, fees or premium in respect of any Extended Loans on such terms as may be set forth in the relevant Extension Offer) will not require
the consent of any other Lender or any other Person, and the requirements of any provision of this Agreement or any other Loan Document
that may otherwise prohibit any such Extension or any other transaction contemplated by this Section 2.15 will not apply to any of the
transactions effected pursuant to this Section 2.15.
Section 2.16
Defaulting Lenders
.
(a)
Defaulting Lender Adjustments. Notwithstanding anything to the contrary contained in this Agreement, if any Lender
becomes a Defaulting Lender, then, until such time as such Lender is no longer a Defaulting Lender, to the extent permitted by applicable
law:
(i)
Defaulting Lender Waterfall. Any payment of principal, interest, fees or other amounts received by the
Administrative Agent for the account of such Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to
Article VIII or otherwise) or received by the Administrative Agent from a Defaulting Lender pursuant to Section 10.09 shall be
applied at such time or times as may be determined by the Administrative Agent as follows: first, to the payment of any amounts
owing by such Defaulting Lender to the Administrative Agent hereunder; next, as the Borrower may request (so long as no Event
of Default shall have occurred and be continuing), to the funding of any Loan in respect of which such Defaulting Lender has
failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent; next, if so determined
by the Administrative Agent and the Borrower, to be held in a Cash Collateral Account and released pro rata in order to satisfy
such Defaulting Lender’s potential future funding obligations with respect to Loans under this Agreement; next, to the payment of
any amounts owing to the Lenders as a result of any judgment of a court of competent jurisdiction obtained by any Lender against
such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement; next, so long as no
Event of Default shall have occurred and be continuing, to the payment of any amounts owing to the Borrower as a result of any
judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such
Defaulting Lender’s breach of its obligations under this Agreement; and next, to such Defaulting Lender or as otherwise directed
by a court of competent jurisdiction; provided that if
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(1) such payment is a payment of the principal amount of any Loans in respect of which such Defaulting Lender has not fully
funded its appropriate share, and (2) such Loans were made at a time when the conditions set forth in Section 4.01 (or, in the case
of Delayed Draw Commitments and Delayed Draw Term Loans, Section 4.02) were satisfied or waived, such payment shall be
applied solely to pay the Loans of all Non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any
Loans of such Defaulting Lender until such time as all Loans and funded are held by the Lenders pro rata in accordance with the
applicable Commitments. Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied
(or held) to pay amounts owed by a Defaulting Lender or to post cash collateral pursuant to this Section 2.16(a) shall be deemed
paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(b)
Defaulting Lender Cure. If the Borrower and the Administrative Agent agree in writing that a Lender is no longer a
Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and
subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the
extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative
Agent may determine to be necessary to cause the Loans to be held pro rata by the Lenders in accordance with the applicable Commitments
whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees
accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; provided further, that except to the
extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or
release of any claim of any party hereunder arising from that Lender having been a Defaulting Lender.
(c)
Hedge Banks. So long as any Lender is a Defaulting Lender, such Lender shall not be a Hedge Bank with respect to any
Secured Hedge Agreement entered into while such Lender was a Defaulting Lender.
Section 2.17
Judgment Currency
.
(a)
If, for the purpose of obtaining judgment in any court, it is necessary to convert a sum owing hereunder or under any
other Loan Document in one currency into another currency, each party hereto and each Loan Party (and by its acceptance of its appointment
in such capacity, each Lead Arranger) agrees, to the fullest extent that it may effectively do so, that the rate of exchange used shall be that at
which, in accordance with normal banking procedures in the relevant jurisdiction, the first currency could be purchased with such other
currency on the Business Day immediately preceding the day on which final judgment is given.
(b)
The obligations of the Loan Parties in respect of any sum due to any party hereto or under any other Loan Document or
any holder of the obligations owing hereunder or under any other Loan Document (the “Applicable Creditor”) shall, notwithstanding any
judgment in a currency (the “Judgment Currency”) other than the currency in which such sum is stated to be due hereunder (the
“Agreement Currency”), be discharged only to the extent that, on the Business Day following receipt by the Applicable Creditor of any sum
adjudged to be so due in the Judgment Currency, the Applicable Creditor may in accordance with normal banking procedures in the relevant
jurisdiction purchase the Agreement Currency with the Judgment Currency; if the amount of the Agreement Currency so purchased is less
than the sum originally due to the Applicable Creditor in the Agreement Currency, the Borrower and each other Loan Party, as a separate
obligation and notwithstanding any such judgment, agrees to indemnify the Applicable Creditor against such loss. The obligations of the
Loan Parties contained in this Section shall survive the termination of this Agreement and the payment of all other amounts owing hereunder.
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TAXES, INCREASED COSTS PROTECTION AND ILLEGALITY
ARTICLE III.
Section 3.01
Taxes
.
(a)
Except as required by applicable Law, any and all payments by the Borrower or any Guarantor to or for the account of
any Agent or any Lender under any Loan Document shall be made free and clear of and without deduction for any and all present or future
taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or similar charges imposed by any Governmental Authority, and all
liabilities (including additions to tax, penalties and interest) with respect thereto (“Taxes”). The following shall be “Excluded Taxes” in the
case of each Agent and each Lender,
(i)
Taxes imposed on or measured by net income (however denominated, and including branch profits and
similar Taxes), and franchise or similar Taxes, in each case, that are (A) imposed by the jurisdiction (or political subdivision
thereof) under the laws of which it is organized or in which its principal office is located or, in the case of any Lender, in which its
applicable Lending Office is located, or (B) Other Connection Taxes;
(ii)
any U.S. federal Tax that is (or would be) required to be withheld with respect to amounts payable hereunder
in respect of an Eligible Assignee (pursuant to an assignment under Section 10.07) on the date it becomes an assignee to the extent
such Tax is in excess of the Tax that would have been applicable had such assigning Lender not assigned its interest arising under
any Loan Document (unless such assignment is at the express written request of the Borrower);
(iii)
U.S. federal withholding Taxes imposed on amounts payable to or for the account of a Lender or Agent with
respect to an applicable interest in a Loan or Commitment pursuant to a Law in effect on the date on which (A) such Lender or
Agent acquires such interest in the Loan or applicable Commitment or, to the extent a Lender acquires an interest in a Loan not
funded pursuant to a prior Commitment, acquires such interest in such Loan (other than pursuant to an assignment request by the
Borrower under Section 3.07) or (B) such Lender changes its Lending Office (other than at the written request of the Borrower to
change such Lending Office), except in each case to the extent that pursuant to Section 3.01, amounts with respect to such Taxes
were payable to such Lender’s or Agent’s assignor immediately before such Lender or Agent became a party hereto, or to such
Lender immediately before it changed its Lending Office;
(iv)
any Taxes imposed as a result of the failure of any Lender or Agent to comply with the provisions of
Sections 3.01(b), 3.01(c) and 3.01(d) (in the case of any Foreign Lender, as defined below) or the provisions of Section 3.01(e) (in
the case of any U.S. Lender, as defined below); and
(v)
any Taxes imposed on any amount payable to or for the account of any Lender or Agent as a result of the
failure of such recipient to satisfy the applicable requirements under FATCA to establish that such payment is exempt from
withholding under FATCA.
If an applicable Withholding Agent is required to deduct any Taxes or Other Taxes (as defined below) from or in respect of any sum payable
under any Loan Document to any Lender or Agent, (A) except in the case of Excluded Taxes, the sum payable shall be increased as necessary
so that after making all required deductions (including deductions applicable to additional sums payable under this Section 3.01(a)), each of
such Lender or Agent receives an amount equal to the sum it would have received had no such deductions been made, (B) the applicable
Withholding Agent shall make such deductions, (C) the applicable Withholding Agent shall pay the full amount deducted to the relevant
taxing authority, and (D) within thirty
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days after the date of any such payment by the Borrower or any Guarantor (or, if receipts or evidence are not available within thirty days, as
soon as practicable thereafter), the Borrower or applicable Guarantor shall furnish to such Lender or Agent (as the case may be) the original
or a facsimile copy of a receipt evidencing payment thereof to the extent such a receipt has been made available to the Borrower or applicable
Guarantor (or other evidence of payment reasonably satisfactory to the Administrative Agent). If the Borrower or Guarantor fails to pay any
Taxes or Other Taxes when due to the appropriate taxing authority, then the Borrower or applicable Guarantor shall indemnify such Lender or
Agent for any incremental Taxes that may become payable by such Lender or Agent arising out of such failure.
(b)
To the extent it is legally able to do so, each Lender or Agent (including an Eligible Assignee to which a Lender assigns
its interest in accordance with Section 10.07, unless such Eligible Assignee is already a Lender hereunder) that is not a “United States
person” within the meaning of Section 7701(a)(30) of the Code (each, a “Foreign Lender”) agrees to complete and deliver to the Borrower
and the Administrative Agent on or prior to the date on which the Foreign Lender becomes a party hereto (and from time to time thereafter
upon the reasonable request of the Borrower or the Administrative Agent), two accurate, complete and signed copies of whichever of the
following is applicable: (i) IRS Form W-8BEN or Form W-8BEN-E certifying that it is entitled to benefits under an income tax treaty to
which the United States is a party; (ii) IRS Form W-8ECI certifying that the income receivable pursuant to any Loan Document is effectively
connected with the conduct of a trade or business in the United States; (iii) if the Foreign Lender is not (A) a bank described in
Section 881(c)(3)(A) of the Code, (B) a 10-percent shareholder of the Borrower described in Section 871(h)(3)(B) of the Code, or (C) a
controlled foreign corporation related to the Borrower within the meaning of Section 864(d)(4) of the Code, a certificate to that effect in
substantially the form attached hereto as Exhibit G (a “Non-Bank Certificate”) and an IRS Form W-8BEN or Form W-8BEN-E, certifying
that the Foreign Lender is not a United States person; (iv) to the extent a Foreign Lender is not the beneficial owner for U.S. federal income
tax purposes, an IRS Form W-8IMY (or any successor forms) of the Foreign Lender, accompanied by, as and to the extent applicable, an IRS
Form W-8BEN, Form W-8BEN-E, Form W-8ECI, Non-Bank Certificate, Form W-9, Form W-8IMY (or other successor forms) and any other
required supporting information from each beneficial owner (it being understood that a Foreign Lender need not provide certificates or
supporting documentation from beneficial owners if (A) the Foreign Lender is a “qualified intermediary” or “withholding foreign
partnership” for U.S. federal income tax purposes and (B) such Foreign Lender is as a result able to establish, and does establish, that
payments to such Foreign Lender are, to the extent applicable, entitled to an exemption from or, if an exemption is not available, a reduction
in the rate of, U.S. federal withholding Taxes without providing such certificates or supporting documentation); or (v) any other form
prescribed by applicable requirements of U.S. federal income tax law as a basis for claiming exemption from or a reduction in U.S. federal
withholding Tax, duly completed, together with such supplementary documentation as may be prescribed by applicable requirements of law
to permit the Borrower and the Administrative Agent to determine the withholding or deduction required to be made.
(c)
In addition, each such Foreign Lender shall, to the extent it is legally entitled to do so, (i) promptly submit to the
Borrower and the Administrative Agent two accurate, complete and signed copies of such other or additional forms or certificates (or such
successor forms or certificates as shall be adopted from time to time by the relevant taxing authorities) as may then be applicable or available
to secure an exemption from or reduction in the rate of U.S. federal withholding Tax (1) on or before the date that such Foreign Lender’s
most recently delivered form, certificate or other evidence expires or becomes obsolete or inaccurate in any material respect, (2) after the
occurrence of a change in the Foreign Lender’s circumstances requiring a change in the most recent form, certificate or evidence previously
delivered by it to the Borrower and the Administrative Agent, and (3) from time to time thereafter if reasonably requested by the Borrower or
the Administrative Agent, and (ii) promptly notify the Borrower and the Administrative
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Agent of any change in the Foreign Lender’s circumstances that would modify or render invalid any claimed exemption or reduction. This
Section 3.01(c) shall not apply to any reporting requirements under FATCA.
(d)
If a payment made to a Lender under any Loan Document would be subject to Tax imposed by FATCA if such Lender
were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the
Code, as applicable), such Lender shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by Law and at
such time or times reasonably requested by the Borrower or the Administrative Agent such documentation prescribed by applicable Law
(including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower
or the Administrative Agent as may be necessary for the Borrower and the Administrative Agent to comply with their obligations under
FATCA and to determine whether such Foreign Lender has complied with such Foreign Lender’s obligations under FATCA or to determine
the amount to deduct and withhold from such payment. Solely for purposes of this Section 3.01(d), “FATCA” shall include any amendments
made to FATCA after the date of this Agreement.
(e)
Each Lender or Agent that is a “United States person” (within the meaning of Section 7701(a)(30) of the Code) (each,
a “U.S. Lender”) agrees to complete and deliver to the Borrower and the Administrative Agent two copies of accurate, complete and signed
IRS Form W-9 or successor form certifying that such U.S. Lender is not subject to U.S. federal backup withholding Tax (i) on or prior to the
Closing Date (or on or prior to the date it becomes a party to this Agreement), (ii) on or before the date that such form expires or becomes
obsolete or inaccurate in any material respect, (iii) after the occurrence of a change in the U.S. Lender’s circumstances requiring a change in
the most recent form previously delivered by it to the Borrower and the Administrative Agent, and (iv) from time to time thereafter if
reasonably requested by the Borrower or the Administrative Agent.
(f)
The Borrower agrees to pay any and all present or future stamp, court or documentary Taxes and any other excise (in
the nature of a documentary or similar Tax), property, intangible, filing or mortgage recording Taxes or charges or similar levies imposed by
any Governmental Authority that arise from any payment made under any Loan Document or from the execution, delivery, performance,
enforcement or registration of, or otherwise with respect to, any Loan Document (including additions to Tax, penalties and interest related
thereto) excluding, in each case, such amounts that are Other Connection Taxes imposed in connection with an Assignment and Assumption,
grant of a participation, transfer or assignment to or designation of a new applicable Lending Office or other office for receiving payments
under any Loan Document, except to the extent that any such change is requested in writing by the Borrower (all such non-excluded Taxes
described in this Section 3.01(f) being hereinafter referred to as “Other Taxes”).
(g)
If any Taxes or Other Taxes are directly asserted against any Lender or Agent with respect to any payment received by
such Lender or Agent in respect of any Loan Document, such Lender or Agent may pay such Taxes or Other Taxes and the Borrower will
promptly indemnify and hold harmless such Lender or Agent for the full amount of such Taxes (other than Excluded Taxes) and Other Taxes
(and any Taxes (other than Excluded Taxes) and Other Taxes imposed on amounts payable under this Section 3.01), and any reasonable
expenses arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally imposed or asserted.
Payments under this Section 3.01(g) shall be made within ten days after the date the Borrower receives written demand for payment from
such Lender or Agent.
(h)
Except as provided in Section 10.07(e), a Participant shall not be entitled to receive any greater payment under this
Section 3.01 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant.
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(i)
If any Lender or Agent determines, in its sole discretion, exercised in good faith, that it has received a refund in respect
of any Taxes or Other Taxes as to which it has been indemnified by the Borrower or any Guarantor, as the case may be, or with respect to
which the Borrower or any Guarantor, as the case may be, has paid additional amounts pursuant to this Section 3.01, it shall promptly pay to
the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by
the Borrower or any Guarantor under this Section 3.01 with respect to the Taxes or Other Taxes giving rise to such refund), net of all
reasonable out-of-pocket expenses incurred by such Lender or Agent and without interest (other than any interest paid by the relevant
Governmental Authority with respect to such refund), provided that the Borrower or applicable Guarantor, as the case may be, upon the
request of such Lender or Agent, agrees to repay the amount paid over to the Borrower or applicable Guarantor, as the case may be (plus any
penalties, interest or other charges imposed by the relevant Governmental Authority) to such Lender or Agent in the event such Lender or
Agent is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Section 3.01(i), in
no event will such Lender or Agent be required to pay any amount to the Borrower or applicable Guarantor pursuant to this Section 3.01(i)
the payment of which would place such Lender or Agent in a less favorable net after-Tax position than the indemnified party would have
been in if the Tax or Other Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise
imposed and the indemnification payments or additional amounts with respect to such Tax or Other Tax had never been paid. Such Lender or
Agent, as the case may be, shall provide the Borrower upon request with a copy of any notice of assessment or other evidence reasonably
available of the requirement to repay such refund received from the relevant Governmental Authority (provided that such Lender or Agent
may delete any information therein that such Lender or Agent deems confidential or not relevant to such refund in its reasonable discretion).
This subsection shall not be construed to require any Lender or Agent to make available its tax returns (or any other information relating to
its Taxes that it reasonably deems confidential) to the Borrower, any Guarantor or any other Person.
(j)
Each Lender agrees that, upon the occurrence of any event giving rise to the operation of Section 3.01(a) or ((g)) with
respect to such Lender, it will, if requested by the Borrower in writing, use commercially reasonable efforts (subject to legal and regulatory
restrictions) to mitigate the effect of any such event, including by designating another Lending Office for any Loan affected by such event
and by completing and delivering or filing any Tax-related forms that such Lender is legally able to deliver and that would reduce or
eliminate any amount of Taxes or Other Taxes required to be deducted or withheld or paid by the Borrower; provided that such efforts are
made at the Borrower’s expense and are on terms that, in the reasonable judgment of such Lender, do not cause such Lender or any of its
Lending Offices to suffer any economic, legal or regulatory disadvantage, and provided further that nothing in this Section 3.01(j) shall affect
or postpone any of the Obligations of the Borrower or the rights of such Lender pursuant to Section 3.01(a) or ((g)).
(k)
Notwithstanding any other provision of this Agreement, the Borrower and the Administrative Agent may deduct and
withhold any Taxes required by any Laws (including, for the avoidance of doubt, FATCA) to be deducted and withheld from any payment
under any of the Loan Documents, subject to the provisions of this Section 3.01.
(l)
Each Agent or Lender, as applicable, shall severally indemnify the Administrative Agent, within ten days after demand
therefor, for (i) any Taxes attributable to such Agent or Lender (but only to the extent that the Borrower has not already indemnified the
Administrative Agent for such Taxes and without limiting the obligation of the Borrower to do so), (ii) any Taxes attributable to such
Lender’s failure to comply with the provisions of Section 10.07(e) relating to the maintenance of a Participant Register and (iii) any Excluded
Taxes attributable to such Agent or Lender, in each case, that are payable or paid by the Administrative Agent in connection with any Loan
Document, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes were correctly or legally
imposed or asserted
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by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Agent or Lender by the
Administrative Agent shall be conclusive absent manifest error. Each Agent and Lender hereby authorizes the Administrative Agent to set off
and apply any and all amounts at any time owing to such Agent or Lender under any Loan Document or otherwise payable by the
Administrative Agent to such Agent or Lender from any other source against any amount due to the Administrative Agent under this
Section 3.01(l).
(m)
Each Lender authorizes the Administrative Agent to deliver to the Borrower and to any successor Administrative
Agent any documentation provided by the Lender to the Administrative Agent pursuant to paragraph (b), (c), (d), or (e) of this Section 3.01.
(n)
The agreements in this Section 3.01 shall survive the resignation or replacement of the Administrative Agent,
termination of this Agreement and the payment of the Loans and all other amounts payable hereunder and any assignment of rights by, or
replacement of, any Lender.
Section 3.02
Illegality
. If any Lender reasonably determines that any Law has made it unlawful, or that any Governmental Authority has asserted that it
is unlawful, for any Lender or its applicable Lending Office to make, maintain or fund Loans whose interest is determined by reference to the
Eurocurrency Rate, or to determine or charge interest rates based upon the Eurocurrency Rate, or any Governmental Authority has imposed
material restrictions on the authority of such Lender to purchase or sell, or to take deposits of, Dollars or any Alternative Currency in the
London interbank market, then, on notice thereof by such Lender to the Borrower through the Administrative Agent, (i) with respect to any
Loans denominated in Dollars, any obligation of such Lender to make or continue Eurocurrency Rate Loans or to convert Base Rate Loans to
Eurocurrency Rate Loans, shall be suspended, and (ii) if such notice asserts the illegality of such Lender making or maintaining Base Rate
Loans the interest rate on which is determined by reference to the Adjusted Eurocurrency Rate component of the Base Rate, the interest rate
on which Base Rate Loans of such Lender shall, if necessary to avoid such illegality, be determined by the Administrative Agent without
reference to the Adjusted Eurocurrency Rate component of the Base Rate, in each case until such Lender notifies the Administrative Agent
and the Borrower that the circumstances giving rise to such determination no longer exist. Upon receipt of such notice, (A) with respect to
Borrowings denominated in Dollars, the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of
Eurocurrency Rate Loans and shall, upon demand from such Lender (with a copy to the Administrative Agent), prepay or, if applicable,
convert all Eurocurrency Rate Loans of such Lender to Base Rate Loans (the interest rate on which Base Rate Loans of such Lender shall, if
necessary to avoid such illegality, be determined by the Administrative Agent without reference to the Adjusted Eurocurrency Rate
component of the Base Rate), either on the last day of the Interest Period therefor, if such Lender may lawfully continue to maintain such
Eurocurrency Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such Eurocurrency Rate Loans,
(B) with respect to Borrowings denominated in an Alternative Currency, the Borrower may revoke any pending request for a Borrowing of,
conversion to or continuation of such Eurocurrency Rate Loans and shall, upon demand from such Lender (with a copy to the Administrative
Agent), prepay or, if applicable, convert all Eurocurrency Rate Loans of such Lender to a Loan bearing interest at an alternative rate mutually
acceptable to the Borrower and the applicable Lenders, either on the last day of the Interest Period therefor, if such Lender may lawfully
continue to maintain such Eurocurrency Rate Loans to such day, or immediately, if such Lender may not lawfully continue to maintain such
Eurocurrency Rate Loans; provided, however, that if the Borrower and the applicable Lenders cannot agree within a reasonable time on an
alternative rate for such Loans, the Borrower may, at its discretion, either (x) prepay such Loans or (y) maintain such Loans outstanding, in
which case, the interest rate payable to the applicable Lender on such Loans will be the rate determined by the Administrative Agent as its
cost of funds to fund a Borrowing of such Loans with maturities comparable to the Interest Period applicable thereto plus the Applicable Rate
or (C) if such notice asserts the illegality of such Lender determining or charging interest rates based upon the Adjusted Eurocurrency Rate
component of the Base Rate with respect to any Base Rate Loans, the Administrative Agent shall during the
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period of such suspension compute the Base Rate applicable to such Lender without reference to the Adjusted Eurocurrency Rate component
thereof until the Administrative Agent is advised in writing by such Lender that it is no longer illegal for such Lender to determine or charge
interest rates based upon the Eurocurrency Rate. Upon any such prepayment or conversion, the Borrower shall also pay accrued interest on
the amount so prepaid or converted.
Section 3.03
Inability to Determine Rates
.
If the Administrative Agent or the Required Lenders reasonably determine that for any reason in connection with any request for a
Eurocurrency Rate Loan or a conversion to or continuation thereof that (a) deposits are not being offered to banks in the London interbank
eurodollar market for the applicable amount and Interest Period of such Eurocurrency Rate Loan, (b) adequate and reasonable means do not
exist for determining the Adjusted Eurocurrency Rate for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan or
in connection with an existing or proposed Base Rate Loan (in each case with respect to clauses (a) and (b), “Impacted Loans”) or (c) the
Eurocurrency Rate for any requested Interest Period with respect to a proposed Eurocurrency Rate Loan does not adequately and fairly reflect
the cost to such Lenders of funding such Loan, the Administrative Agent will promptly so notify the Borrower and each Lender. Thereafter,
(i) the obligation of the Lenders to make or maintain such Eurocurrency Rate Loans shall be suspended, and (ii) in the event of a
determination described in the preceding sentence with respect to the Adjusted Eurocurrency Rate component of the Base Rate, the
utilization of the Adjusted Eurocurrency Rate component in determining the Base Rate shall be suspended, in each case until the
Administrative Agent (upon the instruction of the Required Lenders) revokes such notice. Upon receipt of such notice, (i) with respect to
Borrowings denominated in Dollars, the Borrower may revoke any pending request for a Borrowing of, conversion to or continuation of
Eurocurrency Rate Loans or, failing that, will be deemed to have converted such request into a request for a Borrowing of Base Rate Loans in
the amount specified therein or (ii) with respect to Borrowings denominated in an Alternative Currency, the Borrower may revoke any
pending request for a Borrowing of, conversion to or continuation of Eurocurrency Rate Loans and shall convert all such Eurocurrency Rate
Loans of such Lender to a Loan bearing interest at an alternative rate mutually acceptable to the Borrower and the applicable Lenders;
provided however, that if the Borrower and the applicable Lenders cannot agree within a reasonable time on an alternative rate for such
Loans, the Borrower may, at its discretion, either (A) prepay such Loans or (B) maintain such Loans outstanding, in which case, the interest
rate payable to the applicable Lender on such Loans will be the rate determined by the Administrative Agent as its cost of funds to fund a
Borrowing of such Loans with maturities comparable to the Interest Period applicable thereto plus the Applicable Rate.
Notwithstanding the foregoing, if the Administrative Agent has made the determination described in clause (a) or (b) of the
foregoing paragraph, the Administrative Agent, in consultation with the Borrower, may establish an alternative interest rate for such Loans,
in which case, such alternative rate of interest shall apply with respect to such Loans until (i) the Administrative Agent revokes the notice
delivered with respect to such Loans under clauses (a) or (b) of the first sentence of the foregoing paragraph, (ii) the Administrative Agent or
the Required Lenders notify the Administrative Agent and the Borrower that such alternative interest rate does not adequately and fairly
reflect the cost to such Lenders of funding the Impacted Loans, or (iii) any Lender determines that any law has made it unlawful, or that any
Governmental Authority has asserted that it is unlawful, for such Lender or its applicable Lending Office to make, maintain or fund Loans
whose interest is determined by reference to such alternative rate of interest or to determine or charge interest rates based upon such rate or
any Governmental Authority has imposed material restrictions on the authority of such Lender to do any of the foregoing and provides the
Administrative Agent and the Borrower written notice thereof.
Section 3.04
Increased Cost and Reduced Return; Capital Adequacy; Reserves on Eurocurrency Rate Loans
.
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(a)
Increased Costs Generally. If any Change in Law shall:
(i)
impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar
requirement against assets of, deposits with or for the account of, or credit extended or participated in by, any Lender;
(ii)
subject any Lender to any tax of any kind whatsoever with respect to this Agreement any Eurocurrency Rate
Loan made by it, or change the basis of taxation of payments to such Lender, as applicable, in respect thereof (except, in each
case, for (A) Taxes with respect to which the Borrower is obligated to pay additional amounts or indemnity payments pursuant to
Section 3.01, (B) any Taxes and other amounts described in clauses (ii) through (v) of the second sentence of Section 3.01(a) that
are imposed with respect to payments to or for the account of any Lender or Agent under any Loan Document, (C) Connection
Income Taxes, and (D) Other Taxes); or
(iii)
impose on any Lender or the London interbank market any other condition, cost or expense affecting this
Agreement or Eurocurrency Rate Loans made by such Lender (other than with respect to Taxes) that is not otherwise accounted
for in the definition of the Adjusted Eurocurrency Rate or this clause ((a));
and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Loan the interest on which is
determined by reference to the Eurocurrency Rate or, in the case of a Change in Law with respect to Taxes, making or maintaining any Loan
(or of maintaining its obligation to make any such Loan) then, from time to time within ten days after demand by such Lender setting forth in
reasonable detail such increased costs (with a copy of such demand to the Administrative Agent) (provided that such calculation will not in
any way require disclosure of confidential or price-sensitive information or any other information the disclosure of which is prohibited by
law), the Borrower will pay to such Lender such additional amount or amounts as will compensate such Lender for such additional costs
incurred or reduction suffered. No Lender shall request that the Borrower pay any additional amount pursuant to this Section 3.04(a) unless
it shall concurrently make similar requests to other borrowers similarly situated and affected by such Change in Law and from whom such
Lender is entitled to seek similar amounts.
(b)
Capital Requirements. If any Lender reasonably determines that any Change in Law affecting such Lender or any
Lending Office of such Lender or such Lender’s holding company, if any, regarding liquidity or capital requirements has or would have the
effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of
this Agreement, the Commitments of such Lender or the Loans made by it to a level below that which such Lender or such Lender’s holding
company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s
holding company with respect to liquidity or capital adequacy), then from time to time upon demand of such Lender setting forth in
reasonable detail the charge and the calculation of such reduced rate of return (with a copy of such demand to the Administrative Agent)
(provided that such calculation will not in any way require disclosure of confidential or price-sensitive information or any other information
the disclosure of which is prohibited by law), the Borrower will pay to such Lender such additional amount or amounts as will compensate
such Lender or such Lender’s holding company for any such reduction suffered.
(c)
Certificates for Reimbursement. A certificate of a Lender setting forth the amount or amounts necessary to compensate
such Lender or its holding company, as the case may be, as specified in subsection ((a)) or ((b)) of this Section 3.04 and delivered to the
Borrower shall be conclusive absent manifest error. The Borrower shall pay such Lender, as the case may be, the amount shown as due on
any such certificate within ten days after receipt thereof.
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(d)
Delay in Requests. Failure or delay on the part of any Lender to demand compensation pursuant to the foregoing
provisions of this Section 3.04 shall not constitute a waiver of such Lender’s right to demand such compensation, provided that the Borrower
shall not be required to compensate a Lender pursuant to the foregoing provisions of this Section 3.04 for any increased costs incurred or
reductions suffered more than one hundred and eighty days prior to the date that such Lender notifies the Borrower of the Change in Law
giving rise to such increased costs or reductions and of such Lender’s intention to claim compensation therefor (except that, if the Change in
Law giving rise to such increased costs or reductions is retroactive, then the 180-day period referred to above shall be extended to include the
period of retroactive effect thereof).
(e)
Reserves on Eurocurrency Rate Loans. The Borrower shall pay to each Lender, as long as such Lender shall be required
to maintain reserves with respect to liabilities or assets consisting of or including Eurocurrency Rate funds or deposits (currently known as
“Eurocurrency Liabilities” in Regulation D of the FRB), additional interest on the unpaid principal amount of each Eurocurrency Rate Loan
equal to the actual costs of such reserves allocated to such Loan by such Lender (as determined by such lender in good faith, which
determination shall be conclusive), which shall be due and payable on each date on which interest is payable on such Loan made to the
Borrower; provided the Borrower shall have received at least 10 days’ prior notice (with a copy to the Administrative Agent) of such
additional interest from such Lender. If a Lender fails to give notice 10 days prior to the relevant Interest Payment Date, such additional
interest shall be due and payable 10 days from receipt of such notice.
Section 3.05
Funding Losses
. Upon written demand of any Lender (with a copy to the Administrative Agent) from time to time, which demand shall set forth
in reasonable detail the basis for requesting such amount (provided that such calculation will not in any way require disclosure of confidential
or price-sensitive information or any other information the disclosure of which is prohibited by law), the Borrower shall promptly
compensate such Lender for and hold such Lender harmless from any loss, cost, liability or expense (excluding loss of anticipated profits or
margin) actually incurred by it as a result of:
(a)
any continuation, conversion, payment or prepayment of any Loan other than a Base Rate Loan on a day prior to the
last day of the Interest Period for such Loan (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise);
(b)
any failure by the Borrower (for a reason other than the failure of such Lender to make a Loan) to prepay, borrow,
continue or convert any Loan other than a Base Rate Loan on the date or in the amount notified by the Borrower; or
(c)
any assignment of a Eurocurrency Rate Loan on a day prior to the last day of the Interest Period therefor as a result of a
request by the Borrower pursuant to Section 3.07;
including any loss or expense (excluding loss of anticipated profits or margin) actually incurred by reason of the liquidation or reemployment
of funds obtained by it to maintain such Loan or from fees payable to terminate the deposits from which such funds were obtained.
Notwithstanding the foregoing, no Lender may make any demand under this Section 3.05 (i) with respect to the “floor” specified in the
parenthetical in the first sentence of the definition of Adjusted Eurocurrency Rate or (ii) in connection with any prepayment of interest on
Term Loans.
Section 3.06
Matters Applicable to All Requests for Compensation
.
(a)
Designation of a Different Lending Office. If any Lender requests compensation under Section 3.04, or the Borrower is
required to pay any additional amount to any Lender or any Governmental Authority for the account of any Lender pursuant to Section 3.01,
or if any Lender gives a notice pursuant
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to Section 3.02, then such Lender shall use reasonable efforts to designate a different Lending Office for funding or booking its Loans
hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the judgment of such Lender,
such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 3.01 or 3.04, as the case may be, in the
future, or eliminate the need for the notice pursuant to Section 3.02, as applicable, and (ii) in each case, would not subject such Lender to any
unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender in any material economic, legal or regulatory
respect.
(b)
Suspension of Lender Obligations. If any Lender requests compensation by the Borrower under Section 3.04, the
Borrower may, by notice to such Lender (with a copy to the Administrative Agent), suspend the obligation of such Lender to make or
continue Eurocurrency Rate Loans from one Interest Period to another Interest Period, or to convert Base Rate Loans into Eurocurrency Rate
Loans, until the event or condition giving rise to such request ceases to be in effect (in which case the provisions of Section 3.06(c) shall be
applicable); provided that such suspension shall not affect the right of such Lender to receive the compensation so requested.
(c)
Conversion of Eurocurrency Rate Loans. If any Lender gives notice to the Borrower (with a copy to the Administrative
Agent) that the circumstances specified in Section 3.02, 3.03 or 3.04 hereof that gave rise to the conversion of such Lender’s Eurocurrency
Rate Loans no longer exist (which such Lender agrees to do promptly upon such circumstances ceasing to exist) at a time when Eurocurrency
Rate Loans made by other Lenders are outstanding, such Lender’s Base Rate Loans shall be automatically converted, on the first day(s) of
the next succeeding Interest Period(s) for such outstanding Eurocurrency Rate Loans, to the extent necessary so that, after giving effect
thereto, all Loans of a given Class held by the Lenders of such Class holding Eurocurrency Rate Loans and by such Lender are held pro rata
(as to principal amounts, interest rate basis, and Interest Periods) in accordance with their respective Pro Rata Shares.
Section 3.07
Replacement of Lenders Under Certain Circumstances
. If (i) any Lender requests compensation under Section 3.04 or ceases to make Eurocurrency Rate Loans as a result of any
condition described in Section 3.02 or Section 3.04, (ii) the Borrower is required to pay any Taxes or additional amounts to any Lender or
any Governmental Authority for the account of any Lender pursuant to Section 3.01 and such Lender has declined or is unable to designate a
different Lending Office in accordance with Section 3.01(j), (iii) any Lender is a Non-Consenting Lender, (iv) any Lender does not accept an
Extension Offer, (v) (A) any Lender shall become and continue to be a Defaulting Lender and (B) such Defaulting Lender shall fail to cure
the default pursuant to Section 2.16(b) within five Business Days after the Borrower’s request that it cure such default or (vi) any other
circumstance exists hereunder that gives the Borrower the right to replace a Lender as a party hereto, then the Borrower may, at its sole
expense and effort, upon notice to such Lender and the Administrative Agent, require such Lender to assign and delegate, without recourse
(in accordance with and subject to the restrictions contained in, and consents required by, Section 10.07), all of its interests, rights and
obligations under this Agreement and the related Loan Documents (other than its existing rights to payments pursuant to Section 3.01 or
3.04) to one or more Eligible Assignees that shall assume such obligations (any of which assignee may be another Lender, if a Lender accepts
such assignment), provided that:
(a)
the Borrower shall have paid to the Administrative Agent the assignment fee specified in Section 10.07(b)(iv);
(b)
such Lender shall have received payment of an amount equal to the outstanding principal of its Loans, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts payable
under Section 3.05) from the assignee (to the extent of such outstanding principal and accrued interest and fees) or the Borrower (in the case
of all other amounts);
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(c)
such Lender being replaced pursuant to this Section 3.07 shall (i) execute and deliver an Assignment and Assumption
with respect to such Lender’s Commitment and outstanding Loans, and (ii) deliver any Notes evidencing such Loans to the Borrower or
Administrative Agent (or a lost or destroyed note indemnity in lieu thereof); provided that the failure of any such Lender to execute an
Assignment and Assumption or deliver such Notes shall not render such sale and purchase (and the corresponding assignment) invalid and
such assignment shall be recorded in the Register and the Notes shall be deemed to be canceled upon such failure;
(d)
the Eligible Assignee shall become a Lender hereunder and the assigning Lender shall cease to constitute a Lender
hereunder with respect to such assigned Loans, Commitments and participations, except with respect to indemnification provisions under this
Agreement, which shall survive as to such assigning Lender;
(e)
in the case of any such assignment resulting from a claim for compensation under Section 3.04 or payments required to
be made pursuant to Section 3.01, such assignment will result in a reduction in such compensation or payments thereafter;
(f)
in the case of any such assignment resulting from a Lender being a Non-Consenting Lender, the Eligible Assignee shall
consent, at the time of such assignment, to each matter in respect of which such Lender being replaced was a Non-Consenting Lender; and
(g)
such assignment does not conflict with applicable Laws.
Notwithstanding anything to the contrary contained above, the Lender that acts as the Administrative Agent may not be replaced
hereunder except in accordance with the terms of Section 9.09.
In the event that (i) the Borrower or the Administrative Agent has requested that the Lenders consent to a departure or waiver of
any provisions of the Loan Documents or agree to any amendment thereto, (ii) the consent, waiver or amendment in question requires the
agreement of each Lender, all affected Lenders or all the Lenders or all affected Lenders with respect to a certain Class or Classes of the
Loans and (iii) the Required Lenders or Required Facility Lenders, as applicable, have agreed to such consent, waiver or amendment, then
any Lender who does not agree to such consent, waiver or amendment shall be deemed a “Non-Consenting Lender.”
A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender
or otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
Section 3.08
Survival
. All of the Borrower’s obligations under this Article III shall survive termination of the Aggregate Commitments, repayment of
all other Obligations hereunder and resignation of the Administrative Agent or the Collateral Agent.
ARTICLE IV.
CONDITIONS PRECEDENT TO BORROWINGS
Section 4.01
Conditions to Initial Borrowing
.
The obligation of each Lender to extend credit to Borrower on the Closing Date is subject only to the satisfaction, or waiver in
accordance with Section 10.01, of each of the following conditions precedent, except as otherwise agreed between the Borrower and the Lead
Arrangers:
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(a)
The Administrative Agent’s receipt of the following, each of which may be originals, facsimiles or copies in .pdf
format, unless otherwise specified:
(i)
a Committed Loan Notice duly executed by the Borrower delivered as forth in Section 2.01(b), which (if
delivered prior to the Closing Date) shall be deemed to be conditioned on the consummation of the Transactions;
(ii)
(iii)
this Agreement duly executed by Holdings and the Initial Borrower;
the Guaranty and the Security Agreement, in each case, duly executed by each applicable Loan Party;
(iv)
certificates, if any, representing the Pledged Equity of the Borrower and the Restricted Subsidiaries that
constitute Collateral, in each case, (A) to the extent the issuer of such certificate is a corporation or has “opted into” Article 8 of
the UCC and (B) accompanied by undated stock powers executed in blank and evidence that all other actions required under the
terms of the Security Agreement to perfect the security interests created by the Security Agreement have been taken except as
specified in Section 6.15 hereof and the Security Agreement; provided, however, that, each of the foregoing requirements,
including the delivery of documents and instruments required pursuant to the terms of the Collateral Documents (other than to the
extent that a Lien on such Collateral may be perfected by the filing of a financing statement or financing change statement under
the Uniform Commercial Code), shall not constitute conditions precedent to the Borrowing on the Closing Date after the
Borrower’s use of commercially reasonable efforts to provide such items on or prior to the Closing Date if the Borrower agrees to
deliver, or cause to be delivered, such documents and instruments, or take or cause to be taken such other actions as may be
required to perfect such security interests within ninety (90) days after the Closing Date (subject to extensions approved by the
Administrative Agent in its reasonable discretion);
(v)
(A) certificates of good standing, or its equivalent, from the secretary of state or other applicable office of the
jurisdiction of organization or formation of the Borrower and each other Loan Party, (B) resolutions or other applicable action of
the Borrower and each other Loan Party and (C) an incumbency certificate and/or other certificate of Responsible Officers of
the Borrower and each other Loan Party, evidencing the identity, authority and capacity of each Responsible Officer thereof
authorized to act as a Responsible Officer in connection with this Agreement and the other Loan Documents to which it is a party
or is to be a party on the Closing Date;
(vi)
an opinion from the following special counsel to the Loan Parties (or certain of the Loan Parties): Latham &
Watkins LLP, with respect to matters of New York and certain aspects of Delaware law;
(vii)
a certificate from the chief financial officer or other officer with equivalent duties of the Borrower as to the
Solvency (after giving effect to the Transactions on the Closing Date) of the Borrower substantially in the form attached hereto as
Exhibit I;
(viii)
a certificate from a Responsible Officer of the Borrower certifying as to the satisfaction of the condition in
clause (g) (with respect to the Specified Representations only) below;
provided, however, that, with respect to the requirements set forth in clauses (iii), (iv) and (v) above, each document or instrument required to
be executed by a Loan Party other than Holdings and the Initial
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Borrower (a “Post-Closing Loan Party”), such execution shall not be a condition to the funding of the Initial Term Loans, it being agreed
that such documents shall be executed and delivered in escrow prior to the consummation of the Acquisition and released from escrow upon
funding of the Initial Term Loans and consummation of the Acquisition and upon such release, each Post-Closing Loan Party will be deemed
to have made the Company Specified Representations with respect to itself;
(b)
all fees and expenses required to be paid hereunder on the Closing Date and, with respect to expenses and legal fees, to
the extent invoiced in reasonable detail at least two Business Days before the Closing Date (except as otherwise reasonably agreed to by the
Borrower) shall have been paid in full, it being agreed that such fees and expenses may be paid with the proceeds of the initial funding of one
or more of the Facilities;
(c)
the (i) Loan Documents, (ii) the ABL Loan Documents and (iii) the Senior Secured Notes Documents, required to be
executed on the Closing Date shall have been duly executed and delivered by each Loan Party required to execute such documents pursuant
to the terms thereof;
(d)
the Lenders shall have received at least three Business Days prior to the Closing Date (i) all documentation and other
information about the Loan Parties required under applicable “know your customer” and anti-money laundering rules and regulations,
including the USA PATRIOT Act, and (ii) to the extent the Borrower qualifies as a “legal entity customer” a Beneficial Ownership
Certification, that in each case has been reasonably requested in writing at least ten Business Days prior to the Closing Date;
(e)
confirmation from the Borrower (in the form of an officer’s certificate) that prior to or substantially simultaneously
with the initial Borrowing on the Closing Date,
(i)
each of the following shall have been or will be consummated: the Equity Contribution and the Closing Date
Refinancing;
Agreement; and
(ii)
the Acquisition shall have been or will be consummated in accordance with the terms of the Acquisition
(iii)
since its execution, the Acquisition Agreement has not been amended, waived or modified (whether
pursuant to the Borrower’s consent or otherwise) in any respect in a manner that in the aggregate is materially adverse to the
interests of the Lenders, in their respective capacities as such, without the consent of the Lead Arrangers (such consent not to be
unreasonably withheld, conditioned or delayed); provided, that (i) a reduction in the purchase price under the Acquisition
Agreement (or amendment, supplement or modification to the Acquisition Agreement pursuant to which such reduction is made)
will be deemed not to be materially adverse to the interests of the Lenders and will be allocated (1) first, to a reduction in the
Equity Contribution until the Equity Contribution equals the Minimum Equity Contribution and (2) thereafter to a percentage
reduction to the Equity Contribution equal to the Minimum Equity Contribution, with the balance reducing any amounts to be
funded under the Senior Secured Notes, (ii) any amendment, supplement, modification or waiver to the terms of the Acquisition
Agreement that has the effect of increasing the cash purchase price thereunder to be paid on the Closing Date will not be deemed
to be materially adverse to the Commitment Parties if such increase is not funded with indebtedness for borrowed money incurred
on the Closing Date (other than the ABL Credit Facility, the Term Loans and the Senior Secured Notes), (iii) any amendment,
supplement or modification to, or waiver with respect to, any “marketing period,” or similar provisions in the Acquisition
Agreement will be deemed not to be materially adverse to the Lenders and (iv) any amendment, supplement or modification to, or
waiver with respect to, the definition of “Company Material Adverse Effect,” the definition of “End Date” (or equivalent) or the
“Xerox” provisions contained in the Acquisition
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Agreement (in each case, as in effect on May 10, 2021) will be deemed to be materially adverse to the Lenders;
(f)
there shall not have occurred and be continuing a Company Material Adverse Effect (as defined in the Acquisition
Agreement) that would result in the failure of a condition precedent to the Initial Borrower’s obligations to consummate the Acquisition
under the Acquisition Agreement or that would give it the right (taking into account any notice and cure provisions) to terminate its
obligations pursuant to the terms of the Acquisition Agreement;
(g)
the Acquisition Agreement Representations and the Specified Representations shall be true and correct in all material
respects on and as of the date of the Closing Date; provided that, a failure of an Acquisition Agreement Representation to be accurate will not
result in a failure of a condition precedent under this Section 4.01 or a Default or an Event of Default, unless such failure results in a failure
of a condition precedent to the Merger Sub’s (or its affiliates’) obligation to consummate the Acquisition or such failure gives the Merger Sub
the right (taking into account any notice and cure provisions) to terminate its (or its affiliates’) obligations pursuant to the terms of the
Acquisition Agreement; provided, further, that to the extent that the Acquisition Agreement Representations and the Specified
Representations specifically refer to an earlier date, they shall be true and correct in all material respects as of such earlier date and any such
representation and warranty that is qualified as to “materiality,” “Material Adverse Effect” or similar language shall be true and correct (after
giving effect to any qualification therein) in all respects on such respective dates;
(h)
the Lead Arrangers shall have received:
(i)
an audited balance sheet and related statements of earnings (loss) and comprehensive income (or loss) and
cash flows of the Acquired Business (or a direct or indirect parent thereof) as of the end of the fiscal years ended December 31,
2018, 2019, and 2020, in each case to the extent delivered to the Initial Borrower pursuant to the terms of the Acquisition
Agreement;
(ii)
an unaudited balance sheet and related statements of earnings (loss) and comprehensive income (or loss)
and cash flows of the Acquired Business (or a direct or indirect parent thereof) as of the end of each fiscal quarter (other than the
fourth fiscal quarter of any fiscal year) ended after date of the most recent balance sheet delivered pursuant to clause (i) above and
at least 45 days prior to the Closing Date, in each case, to the extent delivered to the Initial Borrower pursuant to the terms of the
Acquisition Agreement; and
(iii)
an unaudited pro forma consolidated balance sheet and related pro forma income statement of the
Acquired Business (or a direct or indirect parent thereof) as of and for the four consecutive quarter period ending on the last day of
the most recently completed fiscal quarter of the Acquired Business (or a direct or indirect parent thereof) for which financial
statements have been delivered, or are required to be delivered pursuant to clause (i) or (ii) above in each case, giving effect to the
Transactions as 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 the income statement), it being agreed that such pro forma financial statements need not comply with
Regulation S-X under the U.S. Securities Act of 1933, as amended, or include purchase accounting adjustments.
The Lead Arrangers acknowledge receipt of the audited financial statements for the fiscal years ending December 2018, 2019, and
2020 and the unaudited financial statements for the fiscal quarters ending March 31, 2021 and June 30, 2021.
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Without limiting the generality of the provisions of the last paragraph of Section 10.01, for purposes of determining compliance with the
conditions specified in this Section 4.01, each Lender that has signed this Agreement or funded Loans hereunder shall be deemed to have
consented to, approved or accepted or to be satisfied with, each document or other matter required under this Section 4.01 to be consented to
or approved by or acceptable or satisfactory to a Lender, unless the Administrative Agent shall have received notice from such Lender prior
to the proposed Closing Date specifying its objection thereto.
Section 4.02
Conditions to All Borrowings of Delayed Draw Term Loans
.
The obligation of each Lender to honor a Committed Loan Notice with respect to a Borrowing of Delayed Draw Term Loans after
the Closing Date is subject to the following conditions precedent:
(a)
as of the date of such Borrowing, no Specified Event of Default shall have occurred and be continuing on such date
(immediately prior to giving effect to the extensions of credit requested to be made) or would result after giving effect to the extensions of
credit requested to be made on such date.
(b)
The Administrative Agent shall have received a Committed Loan Notice in accordance with the requirements hereof.
(c)
The Borrower shall have paid or caused to be paid (or shall pay or cause to be paid substantially concurrently with such
Borrowing of Delayed Draw Term Loans) all accrued and unpaid Delayed Draw Ticking Fees and Delayed Draw Upfront Fees with respect
to the Delayed Draw Commitments being funded in such Borrowing, together with any fees and expenses due upon such Borrowing.
Subject to Section 1.08(f), each Committed Loan Notice pursuant to this Section 4.02 submitted by the Borrower shall be deemed
to be a representation and warranty that the condition specified in Section 4.02(a) has been satisfied on and as of the date of the applicable
Borrowing.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
The Borrower represents and warrants each of the following to the Lenders, the Administrative Agent and the Collateral Agent, in
each case, to the extent and, unless otherwise specifically agreed by the Borrower, only on the dates required by Sections 2.13, 4.01 or 4.02,
as applicable.
Section 5.01
Existence, Qualification and Power; Compliance with Laws
. Each Loan Party and each Restricted Subsidiary that is a Material Subsidiary,
(a)
is duly organized or formed, validly existing and in good standing under the Laws of the jurisdiction of its
incorporation or organization (to the extent such concepts exist in such jurisdiction);
(b)
has all corporate or other organizational power and authority to (i) own its assets and carry on its business as currently
conducted and (ii) in the case of the Loan Parties, execute, deliver and perform its obligations under the Loan Documents to which it is a
party and consummate the Transactions;
(c)
is duly qualified and in good standing (to the extent such concepts exist in such jurisdiction) under the Laws of each
jurisdiction where its ownership, lease or operation of properties or the conduct of its business requires such qualification;
(d)
is in compliance with all applicable Laws;
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(e)
has all requisite governmental licenses, authorizations, consents and approvals to operate its business as currently
conducted; and
(f)
except in each case referred to in clauses ((c)), ((d)) or ((e)), to the extent that failure to do so has not resulted in, or is
not reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 5.02
Authorization; No Contravention
.
(a)
The execution, delivery and performance by each Loan Party of each Loan Document to which it is a party has been
duly authorized by all necessary corporate or other organizational action.
(b)
None of the execution, delivery or performance by each Loan Party of each Loan Document to which it is a party nor
the consummation of the Transactions will,
(i)
contravene the terms of any of its Organization Documents;
(ii)
result in any breach or contravention of, or the creation of any Lien (other than a Permitted Lien) upon any
assets of such Loan Party or any Restricted Subsidiary, under (A) any Contractual Obligation relating to Material Indebtedness or
(B) any order, injunction, writ or decree of any Governmental Authority or any arbitral award to which such Loan Party or its
property is subject;
(iii)
violate any applicable Law; or
(iv)
require any approval of stockholders, members or partners or any approval or consent of any Person under
any Contractual Obligation relating to Material Indebtedness, except for such approvals or consents which will be obtained on or
before the Closing Date;
except with respect to any breach, contravention or violation (but not creation of Liens) referred to in clauses ((ii)), ((iii)) and ((iv)), to the
extent that such breach, contravention or violation has not resulted in, or is not reasonably expected, individually or in the aggregate, to result
in a Material Adverse Effect.
Section 5.03
Governmental Authorization
. No material approval, consent, exemption, authorization, or other action by, or notice to, or filing with, any Governmental
Authority is necessary or required in connection with the execution, delivery or performance by any Loan Party of this Agreement or any
other Loan Document, except for,
(a)
filings necessary to perfect the Liens on the Collateral granted by the Loan Parties in favor of the Secured Parties;
(b)
the approvals, consents, exemptions, authorizations, actions, notices and filings that have been duly obtained, taken,
given or made and are in full force and effect (except to the extent not required to be obtained, taken, given or made or in full force and effect
pursuant to the Collateral Documents); and
(c)
those approvals, consents, exemptions, authorizations or other actions, notices or filings, the failure of which to obtain
or make has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 5.04
Binding Effect
. This Agreement and each other Loan Document has been duly executed and delivered by each Loan Party that is party hereto and
thereto. This Agreement and each other
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Loan Document constitutes a legal, valid and binding obligation of each Loan Party, enforceable against each Loan Party that is party thereto
in accordance with its terms, except as such enforceability may be limited by applicable Debtor Relief Laws and by general principles of
equity and principles of good faith and fair dealing.
Section 5.05
Financial Statements; No Material Adverse Effect
.
(a)
The Annual Financial Statements fairly present in all material respects the financial condition of the Borrower and its
Subsidiaries as of the dates thereof and their results of operations for the period covered thereby in accordance with GAAP (as in effect on
the Closing Date (or the date of preparation)) consistently applied throughout the periods covered thereby, except as otherwise expressly
noted therein.
(b)
Since the Closing Date, there has been no event or circumstance, either individually or in the aggregate, that has
resulted in, and is reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
(c)
The forecasts of consolidated balance sheets and statements of comprehensive income (loss) of the Borrower and its
Subsidiaries which have been furnished to the Administrative Agent prior to the Closing Date, when taken as a whole, have been prepared in
good faith on the basis of the assumptions stated therein, which assumptions were believed to be reasonable at the time made and at the time
the forecasts are delivered, it being understood that (i) no forecasts are to be viewed as facts, (ii) any forecasts are subject to significant
uncertainties and contingencies, many of which are beyond the control of the Loan Parties, (iii) no assurance can be given that any particular
forecasts will be realized and (iv) actual results may differ and such differences may be material.
Section 5.06
Litigation
. Except as set forth in Schedule 5.06, there are no actions, suits, proceedings, claims or disputes pending or, to the knowledge of
the Borrower, overtly threatened in writing, at law, in equity, in arbitration or before any Governmental Authority, by or against the Borrower
or any of the Restricted Subsidiaries that has resulted in, or is reasonably expected, individually or in the aggregate, to result in Material
Adverse Effect.
Section 5.07
Labor Matters
. Except as set forth on Schedule 5.07 or as has not resulted in, or is not reasonably expected, individually or in the aggregate, to
result in a Material Adverse Effect: (a) there are no strikes or other labor disputes against any of the Borrower or the Restricted Subsidiaries
pending or, to the knowledge of the Borrower, threatened and (b) hours worked by and payment made based on hours worked to employees
of the Borrower or a Restricted Subsidiary have not been in material violation of the Fair Labor Standards Act or any other applicable Laws
dealing with wage and hour matters.
Section 5.08
Ownership of Property; Liens; Insurance
. Each Loan Party and each Restricted Subsidiary has good and valid record title in fee simple to, or valid leasehold interests in, or
easements or other limited property interests in, all real property necessary in the ordinary conduct of its business, free and clear of all Liens
except for Permitted Liens and except where the failure to have such title or other interest has not resulted in, or is not reasonably expected,
individually or in the aggregate, to result in a Material Adverse Effect. Except when the failure to do so has not resulted in, or is not
reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect, the Borrower and each Restricted Subsidiary has
maintained with insurance companies that the Borrower believes (in the good faith judgment of its management) are financially sound and
reputable at the time the relevant coverage is placed or renewed or with a Captive Insurance Subsidiary, insurance with respect to its
properties and business against loss or damage of the kinds customarily insured against by Persons engaged in the same or similar business
and of such types and in such amounts (after giving effect to any self-insurance) as are customarily carried under similar circumstances by
such other Persons.
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Section 5.09
Environmental Matters
.
(a)
Except as has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material
Adverse Effect, (i) the Loan Parties and the Restricted Subsidiaries are in compliance with all applicable Environmental Laws (including
having obtained all Environmental Permits) and (ii) none of the Loan Parties or any of the Restricted Subsidiaries is subject to any pending,
or to the knowledge of the Loan Parties, threatened Environmental Claim or any other Environmental Liability or is aware of any basis for
any Environmental Liability.
(b)
None of the Loan Parties or any of the Restricted Subsidiaries has used, released, treated, stored, transported or
disposed of Hazardous Materials, at or from any currently or formerly owned or operated real estate or facility relating to its business, in a
manner that has resulted in, or is reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 5.10
Taxes
. Except as has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse
Effect, the Borrower and the Restricted Subsidiaries have timely filed all foreign, U.S. federal and state and other tax returns and reports
required to be filed, and have timely paid all foreign, U.S. federal and state and other Taxes, assessments, fees and other governmental
charges (including satisfying their withholding Tax obligations) levied or imposed on their properties, income or assets or otherwise due and
payable, except those which are being contested in good faith by appropriate actions diligently conducted and for which adequate reserves
have been provided in accordance with GAAP.
Section 5.11
ERISA Compliance
.
(a)
Except as set forth on Schedule 5.11(a) or has not resulted in, or is not reasonably expected, individually or in the
aggregate, to result in a Material Adverse Effect, each Plan is in compliance with the applicable provisions of ERISA, the Code and other
federal or state, provincial, territorial and foreign Laws.
(b)
Except as set forth on Schedule 5.11(b) or, with respect to each of the below clauses of this Section 5.11(b), as has not
resulted in, or is not reasonably expected, individually or in the aggregate, to result in Material Adverse Effect,
(i)
(ii)
no ERISA Event has occurred or is reasonably expected to occur;
neither the Borrower, nor any Subsidiary Guarantor nor any of their respective ERISA Affiliates has engaged
in a transaction that is subject to Sections 4069 or 4212(c) of ERISA; and
(iii)
neither the Borrower, nor any Subsidiary Guarantor nor any ERISA Affiliate has been notified by the
sponsor of a Multiemployer Plan that such Multiemployer Plan is insolvent (within the meaning of Section 4245 of ERISA) or has
been determined to be in “endangered” or “critical” status (within the meaning of Section 432 of the Code or Section 305 of
ERISA) and no such Multiemployer Plan is expected to be insolvent or in endangered or critical status.
Section 5.12
Subsidiaries
. As of the Closing Date, all of the outstanding Equity Interests in the Borrower and each Material Subsidiary have been validly
issued and are fully paid and (if applicable) non-assessable, and all Equity Interests owned by Holdings (in the Borrower), and by the
Borrower or any Subsidiary Guarantor in any of their respective direct Material Subsidiaries are owned free and clear of all Liens (other than
Permitted Liens) of any Person. As of the Closing Date, Schedule 5.12 (i) sets forth the name and jurisdiction of each Subsidiary, (ii) sets
forth the ownership interest of Holdings, the Borrower and each Subsidiary in each Subsidiary, including the percentage of such ownership
and (iii) identifies each Subsidiary
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that is a Subsidiary the Equity Interests of which are required to be pledged on the Closing Date pursuant to the Collateral Documents.
Section 5.13
Margin Regulations; Investment Company Act
.
(a)
As of the Closing Date, none of the Collateral is Margin Stock. No Loan Party is engaged nor will it engage, principally
or as one of its important activities, in the business of purchasing or carrying Margin Stock (within the meaning of Regulation U issued by
the FRB), or extending credit for the purpose of purchasing or carrying Margin Stock, and no proceeds of any Borrowings will be used for
any purpose that violates Regulation U.
(b)
Neither the Borrower nor any Guarantor is an “investment company” under the Investment Company Act of 1940.
Section 5.14
Disclosure
. As of the Closing Date, none of the written information and written data heretofore or contemporaneously furnished by or on
behalf of any Loan Party to any Agent or any Lender on or prior to the Closing Date in connection with the Transactions and the negotiation
of this Agreement or delivered hereunder or any other Loan Document on or prior to the Closing Date, when taken as a whole, contains any
material misstatement of fact or omits to state any material fact necessary to make such written information and written data taken as a
whole, in the light of the circumstances under which it was delivered, not materially misleading (after giving effect to all modifications and
supplements to such written information and written data, in each case, furnished after the date on which such written information or such
written data was originally delivered and prior to the Closing Date); it being understood that for purposes of this Section 5.14, such written
information and written data shall not include projections, pro forma financial information, financial estimates, forecasts or other forward-
looking information or information of a general economic or general industry nature or prepared by the Lead Arrangers.
Section 5.15
Intellectual Property; Licenses, Etc.
The Borrower and the Restricted Subsidiaries own or have a valid right to use, all the Intellectual Property necessary for the
operation of their respective businesses as currently conducted, except where the failure to have any such rights, has not resulted in, or is not
reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect. To the knowledge of the Borrower, the operation
of the respective businesses of the Borrower and the Restricted Subsidiaries as currently conducted does not infringe upon, misappropriate or
violate any Intellectual Property rights held by any Person except for such infringements, misappropriations or violations that have not
resulted in, or are not reasonably expected, individually or in the aggregate, to result in, a Material Adverse Effect. No claim or litigation
regarding any Intellectual Property owned by the Borrower or any of the Restricted Subsidiaries is pending or, to the knowledge of the
Borrower, threatened against the Borrower or any Restricted Subsidiary, that, has resulted in, or is reasonably expected, individually or in the
aggregate, to result in a Material Adverse Effect.
Section 5.16
Solvency
. On the Closing Date after giving effect to the Transactions, the Borrower and its Subsidiaries, on a consolidated basis, are
Solvent.
Section 5.17
USA PATRIOT Act, FCPA and OFAC
.
(a)
To the extent applicable, each of the Loan Parties and the Restricted Subsidiaries is in compliance, in all material
respects, with (a) 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
(b) the USA PATRIOT Act and other similar anti-money laundering rules and regulations.
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(b)
Each of the Loan Parties and the Restricted Subsidiaries, and their respective officers, directors and employees, and to
the Borrower’s knowledge, their respective agents, affiliates and representatives, have conducted their businesses in compliance in all
material respects with the FCPA, the UK Bribery Act 2010 and other similar anti-corruption legislation in other jurisdictions. The Borrower
will not directly, or to its knowledge indirectly, use the proceeds of the Loans in violation of the FCPA, the UK Bribery Act 2010 or other
similar anti-corruption legislation in other jurisdictions.
(c)
None of the Loan Parties or any of the Restricted Subsidiaries, nor, to the knowledge of the Borrower, any director,
officer, agent, employee or Affiliate or representative thereof, is an individual or entity that is, or is owned or controlled by any individual or
entity that is, (a) the subject or target of any Sanctions, (b) included on OFAC’s List of Specially Designated Nationals, HMT’s Consolidated
List of Financial Sanctions Targets, the Investment Ban List or any other Sanctions list, or (c) located, organized or resident in a Designated
Jurisdiction. The Borrower will not directly, or to its knowledge indirectly, use the proceeds of the Loans or otherwise knowingly make
available such proceeds to any Person, for the purpose of financing the activities of any Person that, at the time of such financing, is (a) the
subject or target of any Sanctions, (b) included on OFAC’s List of Specially Designated Nationals, HMT’s Consolidated List of Financial
Sanctions Targets, the Investment Ban List or any other Sanctions list, or (c) located, organized or resident in a Designated Jurisdiction.
Section 5.18
Collateral Documents
. Except as otherwise contemplated hereby or under any other Loan Documents, the provisions of the Collateral Documents,
together with such filings and other actions required to be taken hereby or by the applicable Collateral Documents or contemplated by the
Collateral Documents (including the delivery to Collateral Agent of any Pledged Debt and any Pledged Equity required to be delivered
pursuant to the applicable Collateral Documents), are effective to create in favor of the Collateral Agent for the benefit of the Secured Parties
a legal, valid and enforceable perfected Lien (subject to Permitted Liens) on all right, title and interest of Holdings, the Borrower and the
applicable Subsidiary Guarantors, respectively, in the Collateral described therein.
Section 5.19
Use of Proceeds
. The Borrower has used the proceeds of the Loans only in compliance (and not in contravention of) applicable Laws and each
Loan Document.
ARTICLE VI.
AFFIRMATIVE COVENANTS
So long as the Termination Conditions have not been satisfied, the Borrower shall, and shall (except in the case of the covenants
set forth in Sections 6.01, 6.02 and 6.03) cause each of the Restricted Subsidiaries to:
Section 6.01
Financial Statements
. Deliver to the Administrative Agent for prompt further distribution by the Administrative Agent to each Lender each of the
following:
(a)
Audited Annual Financial Statements. Within one hundred and twenty (120) days after the end of each fiscal year of the
Borrower or, in the case of the first fiscal year ending after the Closing Date, within one hundred and fifty (150) days, a consolidated balance
sheet of the Borrower and its Subsidiaries as at the end of such fiscal year, and the related consolidated statements of comprehensive income
(loss), stockholders’ equity and cash flows for such fiscal year together with related notes thereto, setting forth in each case in comparative
form the figures for the previous fiscal year (commencing wth the second full fiscal year ended after the Closing Date), prepared in
accordance with GAAP in all material respects, audited and accompanied by a report and opinion of the Borrower’s auditor on the Closing
Date or any other accounting firm of nationally or regionally recognized standing or another accounting firm reasonably acceptable to the
Administrative Agent, which report and opinion shall be prepared in accordance with
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generally accepted auditing standards and shall not be subject to any explanatory statement as to the Borrower’s ability to continue as a
“going concern” or like qualification or exception (excluding any “emphasis of matter” paragraph), other than any such statement,
qualification or exception resulting from or relating to (i) an actual or anticipated breach of a Financial Covenant, (ii) an upcoming maturity
date, (iii) activities, operations, financial results or liabilities of any Person other than the Loan Parties and the Restricted Subsidiaries or (iv)
changes in accounting principles or practices, which financial statements shall be accompanied by management’s discussion and analysis
describing results of operations in the form customarily prepared by management of the Borrower.
(b)
Quarterly Financial Statements. As soon as available, but in any event within forty five (45) days after the end of each
of the first three fiscal quarters of each fiscal year of the Borrower (commencing with the first full fiscal quarter ending after the Closing
Date) or, in the case of the first two such full fiscal quarters ending after the Closing Date, within seventy-five (75) days, (i) a condensed
consolidated balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal quarter, (ii) the related condensed consolidated
statements of comprehensive income (loss) for such fiscal quarter and for the portion of the fiscal year then ended and (iii) the
related condensed consolidated statement of cash flows for the portion of the fiscal year then ended, setting forth, in each case of
clauses (ii) and (iii), in comparative form, the figures for the corresponding fiscal quarter of the previous fiscal year and the corresponding
portion of the previous fiscal year, in each case if ended after the Closing Date, certified by a Responsible Officer of the Borrower as fairly
presenting in all material respects the financial condition, results of operations and cash flows of the Borrower and its Subsidiaries in material
compliance with GAAP, subject to year-end adjustments and the absence of footnotes, which financial statements shall be accompanied by
management’s discussion and analysis describing results of operations in the form customarily prepared by management of the Borrower.
(c)
Lender Calls. The Borrower shall conduct annual conference calls with management of the Borrower (provided that to
the extent any conference calls for holders of the Senior Secured Notes or any refinancing thereof are conducted quarterly, the Borrower shall
conduct such lender calls quarterly), which conference calls may be combined with any conference calls for the holders of the Borrower’s or
any Parent Entity’s securities, and in each case, subject to the requirements of this covenant, within fifteen (15) Business Days (or such later
date as may be agreed by the Administrative Agent) after the time periods with respect to delivery of the financial statements required by
clauses (a) and (b) above, to discuss the financial performance of the Borrower and its Restricted Subsidiaries for the most recently ended
fiscal year or fiscal quarter, as the case may be, for which financial statements have been delivered pursuant to clauses (a) or (b) above.
(d)
Budget; Projections. Prior to the consummation of a Qualifying IPO, within one hundred twenty (120) days after the
end of each fiscal year (beginning with the fiscal year ending December 31, 2021), a consolidated budget for the following fiscal year on a
quarterly basis as customarily prepared by management of the Borrower for its internal use and setting forth the material underlying
assumptions based on which such consolidated budget was prepared (including any projected consolidated balance sheet of the Borrower and
its Subsidiaries as of the end of the following fiscal year and the related consolidated statements of projected operations or income and
projected cash flow, in each case, to the extent prepared by management of the Borrower and included in such consolidated budget), which
projected financial statements shall be prepared in good faith on the basis of assumptions believed by the Borrower to be reasonable at the
time of preparation of such projected financial statements.
(e)
Unrestricted Subsidiaries. Simultaneously with the delivery of each set of consolidated financial statements referred to
in Section 6.01(a) and Section 6.01(b) above, such supplemental financial information (which need not be audited) as is necessary to
eliminate the accounts of Unrestricted Subsidiaries (if any) from such consolidated financial statements.
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Notwithstanding the foregoing, the obligations in paragraphs (a) and (b) of this Section 6.01 may be satisfied with respect to
financial information of the Borrower and its Subsidiaries by furnishing (i) the applicable financial statements of any Person of which the
Borrower is a Subsidiary (such Person, a “Parent Entity”) or (ii) the Borrower’s or a Parent Entity’s Form 10-K or 10-Q, as applicable, filed
with the SEC; provided that with respect to each of clauses (i) and (ii), (A) to the extent such information relates to a Parent Entity and there
are material differences between the financial information at such Parent Entity and the Borrower, such information is accompanied by such
supplemental financial information (which need not be audited) as is necessary to eliminate the accounts of such Parent Entity and each of its
Subsidiaries, other than the Borrower and its Subsidiaries and (B) to the extent such information is in lieu of information required to be
provided under Section 6.01(a), such materials are accompanied by a report and opinion of such Parent Entity’s auditor on the Closing Date,
any other accounting firm of nationally or regionally recognized standing or another accounting firm reasonably acceptable to the
Administrative Agent, which report and opinion shall be prepared in accordance with generally accepted auditing standards and shall not be
subject to any explanatory statement as to the Borrower’s ability to continue as a “going concern” or like qualification or exception
(excluding any “emphasis of matter” paragraph), other than any such statement, qualification or exception resulting from or relating to (i) an
actual or anticipated breach of a Financial Covenant, (ii) an upcoming maturity date, (iii) activities, operations, financial results or liabilities
of any Person other than the Loan Parties and the Restricted Subsidiaries or (iv) changes in accounting principles or practices. Any financial
statements required to be delivered pursuant to this Section 6.01 shall not be required to contain purchase accounting adjustments to the
extent it is not practicable to include any such adjustments in such financial statements.
Section 6.02
Certificates; Other Information
. Deliver to the Administrative Agent for prompt further distribution by the Administrative Agent to each Lender each of the
following:
(a)
Compliance Certificate. No later than five (5) days after the delivery of the financial statements referred to in
Sections 6.01(a) and 6.01(b), a duly completed Compliance Certificate.
(b)
SEC Filings. Promptly after the same are publicly available, copies of all annual, regular, periodic and special reports,
proxy statements and registration statements which Holdings or the Borrower or any Restricted Subsidiary files with the SEC (other than
amendments to any registration statement (to the extent such registration statement, in the form it became effective, is delivered to the
Administrative Agent), exhibits to any registration statement and, if applicable, any registration statement on Form S-8), and in any case not
otherwise required to be delivered to the Administrative Agent pursuant to any other clause of this Section 6.02; provided that
notwithstanding the foregoing, the obligations in this Section 6.02(b) may be satisfied by causing such information to be publicly available
on the SEC’s EDGAR website or another publicly available reporting service.
(c)
Information Regarding Collateral. The Borrower agrees to notify the Collateral Agent within forty-five (45) days of
such event of any change (or such later date as the Collateral Agent may agree in its reasonable discretion),
(i)
(ii)
(iii)
in the legal name of any Loan Party or any Person required to be a Loan Party;
in the identity or type of organization of any Loan Party or any Person required to be a Loan Party;
in the jurisdiction of organization of any Loan Party or any Person required to be a Loan Party; or
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(iv)
in the location (within the meaning of Section 9-307 of the UCC) of any Loan Party or any Person required
to be a Loan Party under the UCC.
(d)
Other Information. Such additional information as may be reasonably requested by the Administrative Agent or any
Lender through the Administrative Agent for purposes of compliance with applicable “know your customer” and anti-money laundering rules
and regulations, including the USA PATRIOT Act and the Beneficial Ownership Regulation.
Documents required to be delivered pursuant to Section 6.01 or Section 6.02 may be delivered electronically and if so delivered,
shall be deemed to have been delivered on the date (i) on which the Borrower posts such documents, or provides a link thereto, on the
Borrower’s website on the Internet at the website addresses listed on Schedule 10.02, or (ii) on which such documents are posted on the
Borrower’s behalf on Merrill Datasite One, Intralinks/Intra Agency, Syndtrak or another relevant website, if any, to which each Lender and
the Administrative Agent have access (whether a commercial, third-party website or whether sponsored by the Administrative Agent);
provided that: (A) upon written request by the Administrative Agent, the Borrower shall deliver paper copies of such documents to the
Administrative Agent for further distribution to each Lender until a written request to cease delivering paper copies is given by the
Administrative Agent and (B) the Borrower shall notify (which may be by facsimile or electronic mail) the Administrative Agent of the
posting of any such documents and provide to the Administrative Agent by electronic mail electronic versions (i.e., soft copies) of such
documents. Each Lender shall be solely responsible for timely accessing posted documents or requesting delivery of paper copies of such
documents from the Administrative Agent and maintaining its copies of such documents.
The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Lead Arrangers will make available to the
Lenders materials and/or information provided by or on behalf of the Borrower hereunder (collectively, “Borrower Materials”) by posting
the Borrower Materials on Merrill Datasite One, Intralinks/Intra Agency, Syndtrak or another similar electronic system (the “Platform”) and
(b) certain of the Lenders may have personnel who do not wish to receive any information with respect to the Borrower or its Subsidiaries, or
the respective securities of any of the foregoing, that is not Public-Side Information, and who may be engaged in investment and other
market-related activities with respect to such Person’s securities. The Borrower hereby agrees that (i) all Borrower Materials that are to be
made available to Public Lenders shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word
“PUBLIC” shall appear prominently on the first page thereof (and by doing so shall be deemed to have represented that such information
contains only Public-Side Information); (ii) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized
the Administrative Agent, the Lead Arrangers and the Lenders to treat such Borrower Materials as containing only Public-Side Information
(provided however, that to the extent such Borrower Materials constitute Information, they shall be treated as set forth in Section 10.08);
(iii) all Borrower Materials marked “PUBLIC” are permitted to be made available through a portion of the Platform designated “Public-Side
Information”; and (iv) the Administrative Agent and/or the Lead Arrangers shall be entitled to treat any Borrower Materials that are not
marked “PUBLIC” as being suitable only for posting on a portion of the Platform not designated “Public-Side Information.”
For the avoidance of doubt, the foregoing shall be subject to the provisions of Section 10.08.
Section 6.03
Notices
. Promptly after a Responsible Officer obtains actual knowledge thereof, notify the Administrative Agent for prompt further
notification by the Administrative Agent to each Lender of:
(a)
the occurrence of any (i) Default or Event of Default or (ii) “Default” or “Event of Default” under and as defined in the
ABL Credit Agreement or the Senior Secured Notes Indenture; and
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(b)
(i) any dispute, litigation, investigation or proceeding between the Borrower or any Restricted Subsidiary and any
arbitrator or Governmental Authority or (ii) the filing or commencement of, or any material development in, any litigation or proceeding
affecting the Borrower or any Restricted Subsidiary, or (iii) the occurrence of any ERISA Event that, in any such case referred to in clause
(i) through (iii), has resulted, or is reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Each notice pursuant to this Section 6.03 shall be accompanied by a written statement of a Responsible Officer of the Borrower
setting forth a summary description of the occurrence referred to therein and stating what action the Borrower has taken and proposes to take
with respect thereto. For the avoidance of doubt, the foregoing shall be subject to the provisions of Section 10.08.
Section 6.04
Payment of Certain Taxes
. Timely pay, discharge or otherwise satisfy, as the same shall become due and payable, all obligations and liabilities in respect of
Taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or in respect of its property, except, in
each case, to the extent (a) any such Tax, assessment, charge or levy is being contested in good faith and by appropriate actions diligently
conducted and for which appropriate reserves have been established in accordance with GAAP or (b) the failure to pay, discharge or
otherwise satisfy the same has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse
Effect.
Section 6.05
Preservation of Existence, Etc.
(a)
Preserve, renew and maintain in full force and effect its legal existence under the Laws of the jurisdiction of its
incorporation or organization, as applicable; and
(b)
take all reasonable action to preserve, renew and keep in full force and effect those of its rights (including with respect
to Intellectual Property), licenses, permits, privileges, and franchises, that are material to the conduct of the business of the Loan Parties taken
as a whole;
except in the case of clause ((a)) or ((b)), (i) in connection with a transaction permitted by the Loan Documents (including transactions
permitted by Section 7.04 or Section 7.05), (ii) with respect to any Immaterial Subsidiary, or (iii) to the extent that failure to do so has not
resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 6.06
Maintenance of Properties
. Maintain, preserve and protect all of its material properties and equipment used in the operation of its business in good working
order, repair and condition (ordinary wear and tear excepted and casualty or condemnation excepted), except to the extent the failure to do so
has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse Effect.
Section 6.07
Maintenance of Insurance
.
(a)
Except when the failure to do so has not resulted in, or is not reasonably expected, individually or in the aggregate, to
result in a Material Adverse Effect, maintain or cause to be maintained with insurance companies that the Borrower believes (in the good
faith judgment of its management) are financially sound and reputable at the time the relevant coverage is placed or renewed or with a
Captive Insurance Subsidiary, insurance with respect to its properties and business against loss or damage of the kinds customarily insured
against by Persons engaged in the same or similar business and of such types and in such amounts (after giving effect to any self-insurance)
as are customarily carried under similar circumstances by such other Persons, and furnish to the Administrative Agent, which, absent a
continuing Event of Default, shall not be made more than once in any twelve month period, upon reasonable written
127
request from the Administrative Agent, information presented in reasonable detail as to the insurance so carried.
(b)
Subject to Section 6.15, each such policy of insurance with respects to jurisdictions within the United States shall as
appropriate and is customary,
(i)
to liability insurance), or
name the Collateral Agent, on behalf of the Secured Parties, as an additional insured thereunder (with respect
(ii)
to the extent covering Collateral in the case of property insurance, contain a lenders’ loss payable clause or
endorsement that names the Collateral Agent, on behalf of the Secured Parties, as the lenders’ loss payee or mortgagee, as
applicable, thereunder;
provided that (A) absent a Specified Event of Default that is continuing, any proceeds of any such insurance shall be delivered by
the insurer(s) to Holdings, the Borrower or one of its Subsidiaries and may be applied in accordance with (or, if this Agreement
does not provide for application of such proceeds, in a manner that is not prohibited by) this Agreement and (B) this
Section 6.07(b) shall not be applicable to (1) business interruption insurance, workers’ compensation policies, employee liability
policies or directors and officers policies, (2) policies to the extent the Collateral Agent cannot have an insurable interest therein or
is unable to be named as an additional insured or loss payee thereunder or (3) the extent unavailable from the relevant insurer after
the Borrower’s use of its commercially reasonable efforts.
Section 6.08
Compliance with Laws
. (a) Comply with the requirements of all Laws (including applicable ERISA-related laws and all Environmental Laws) and all
orders, writs, injunctions and decrees of any Governmental Authority applicable to it or to its business or property, except to the extent the
failure to comply therewith has not resulted in, or is not reasonably expected, individually or in the aggregate, to result in a Material Adverse
Effect and (b) comply in all material respects with the requirements of the USA PATRIOT Act, FCPA, the Corruption of Foreign Public
Officials Act (Canada), OFAC, UK Bribery Act of 2010 and other anti-terrorism, anti-corruption and anti-money laundering Laws; provided
that the requirements set forth in this Section 6.08, as they pertain to compliance by any Foreign Subsidiary with the USA PATRIOT ACT,
FCPA, OFAC and UK Bribery Act of 2010 are subject to and limited by any Law applicable to such Foreign Subsidiary in its relevant local
jurisdiction.
Section 6.09
Books and Records
. Maintain proper books of record and account in which entries that are full, true and correct in all material respects shall be made
of all material financial transactions and material matters involving the assets and business of the Borrower or such Restricted Subsidiary, as
the case may be (it being understood and agreed that Foreign Subsidiaries may maintain individual books and records in conformity with
generally accepted accounting principles in their respective countries of organization or operations and that such maintenance shall not
constitute a breach of the representations, warranties or covenants hereunder), in each case, to the extent necessary to prepare the financial
statements described in Sections 6.01(a) and 6.01(b).
Section 6.10
Inspection Rights
. Permit representatives of the Administrative Agent and Required Lenders to visit and inspect any of its properties, to examine its
corporate, financial and operating records, and make copies thereof or abstracts therefrom and to discuss its affairs, finances and accounts
with its directors, officers and independent public accountants (subject to such accountants’ policies and procedures), all at the reasonable
expense of the Borrower and at such reasonable times during normal business hours and as often as may be reasonably desired, upon
reasonable advance notice to the Borrower; provided that (a) excluding any such visits and inspections during the continuation of an Event of
Default, only the Administrative Agent on behalf of the Lenders may exercise rights under this Section 6.10 and the
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Administrative Agent shall not exercise such rights more often than two times during any calendar year absent the continuation of an Event
of Default and only one such time shall be at the Borrower’s expense and (b) when an Event of Default is continuing, the Administrative
Agent or the Required Lenders (or any of their respective representatives) may do any of the foregoing at the expense of the Borrower at any
time during normal business hours and upon reasonable advance notice. The Administrative Agent shall give the Borrower the opportunity to
participate in any discussions with the Borrower’s independent public accountants. For the avoidance of doubt, the foregoing shall be subject
to the provisions of Section 10.08.
Section 6.11
Covenant to Guarantee Obligations and Give Security
. At the Borrower’s expense, subject to any applicable limitation in any Loan Document (including Section 6.12), take the
following actions:
(a)
within ninety days of the occurrence of any Grant Event (or such longer period as the Administrative Agent may agree
in its reasonable discretion),
(i)
cause the Restricted Subsidiary subject of the Grant Event to execute and deliver the Guaranty (or a joinder
thereto), which may be accomplished by executing a Guaranty Supplement;
(ii)
cause the Restricted Subsidiary subject of the Grant Event to execute and deliver the Security Agreement (or
a supplement thereto), which may be accomplished by executing a Security Agreement Supplement;
(iii)
cause the Restricted Subsidiary subject of the Grant Event to execute and deliver any applicable Intellectual
Property Security Agreements with respect to its registered or applied for Intellectual Property constituting Collateral;
(iv)
cause the Restricted Subsidiary subject of the Grant Event to execute and deliver an acknowledgement of the
Closing Date ABL Intercreditor Agreement, the Closing Date Equal Priority Intercreditor Agreement and any other applicable
Intercreditor Agreement;
(v)
cause the Restricted Subsidiary subject of the Grant Event (and any Loan Party of which such Restricted
Subsidiary is a direct Subsidiary) to (1) if such Restricted Subsidiary is a corporation or has “opted into” Article 8 of the Uniform
Commercial Code, deliver any and all certificates representing its Equity Interests (to the extent certificated) that constitute
Collateral and are required to be delivered pursuant to the Security Agreement, accompanied by undated stock powers or other
appropriate instruments of transfer executed in blank (or any other documents customary under local law), (2) execute and
deliver a counterparty signature page to the Global Intercompany Note (or a joinder thereto), (3) deliver all instruments
evidencing Indebtedness held by such Restricted Subsidiary that constitute Collateral and are required to be delivered pursuant to
the Security Agreement, endorsed in blank, to the Collateral Agent, and (4) if such Restricted Subsidiary is a Foreign Subsidiary,
deliver such additional security documents and enter into additional collateral arrangements in the jurisdiction of such Foreign
Subsidiary reasonably satisfactory to the Administrative Agent;
(vi)
upon the reasonable request of the Administrative Agent, take and cause the Restricted Subsidiary the
subject of the Grant Event and each direct or indirect parent of such Restricted Subsidiary that is required to become a Subsidiary
Guarantor pursuant to this Agreement that directly holds Equity Interests in such Restricted Subsidiary to take such customary
actions as may be necessary in the reasonable opinion of the Administrative Agent to vest in the Collateral Agent (or in any
representative of the Collateral Agent designated by it) perfected Liens (subject to Permitted Liens) in the Equity Interests of such
Restricted Subsidiary and the personal property
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and fixtures of such Restricted Subsidiary to the extent required by the Loan Documents, enforceable against all third parties in
accordance with their terms, except as such enforceability may be limited by applicable Debtor Relief Laws and by general
principles of equity (regardless of whether enforcement is sought in equity or at law);
(vii)
upon request of the Administrative Agent deliver to the Administrative Agent a signed copy of a customary
opinion, addressed to the Administrative Agent and the other Secured Parties, of counsel for the Loan Parties as to such matters set
forth in this Section 6.11(a) as the Administrative Agent may reasonably request; provided that such matters are not inconsistent
with those addressed in opinions delivered on the Closing Date or customary market practice;
provided, that actions relating to Liens on real property are governed by Section 6.11(b) and not this Section 6.11(a).
(b)
Material Real Property.
(i)
Notice.
(A)
Within sixty (60) days after the formation, acquisition or designation of a Material Domestic
Subsidiary (other than any Excluded Subsidiary) described in Section 6.11(a) (or, in each case, such longer period as
the Administrative Agent may agree in its reasonable discretion), the Borrower will, or will cause such Material
Domestic Subsidiary to, furnish to the Collateral Agent a description of any Material Real Property (other than any
Excluded Asset) owned by such Material Domestic Subsidiary in reasonable detail.
(B)
Within sixty (60) days after the acquisition of any Material Real Property by a Loan Party after the
Closing Date (or such longer period as the Administrative Agent may agree in its reasonable discretion), the Borrower
will furnish to the Collateral Agent a description of such Material Real Property in reasonable detail.
(ii)
Mortgages, etc. If requested by the Administrative Agent, the Borrower will, or will cause the applicable
Loan Party to, provide the Collateral Agent with a Mortgage with respect to Material Real Property that is the subject of a notice
delivered pursuant to Section 6.11(b)(i), in each case within ninety days of or the event that triggered the requirement to give such
notice (or, in each case, such longer period as the Administrative Agent may agree in its sole discretion) together with:
(A)
evidence that counterparts of such Mortgage have been duly executed, acknowledged and
delivered and are in a form suitable for filing or recording in all filing or recording offices that the Collateral Agent
may deem reasonably necessary or desirable in order to create a valid and enforceable perfected Lien on such Material
Real Property in favor of the Collateral Agent for the benefit of the Secured Parties and that all filing and recording
taxes and fees have been paid or are otherwise provided for in a manner reasonably satisfactory to the Collateral Agent;
provided that to the extent any Material Real Property to be subject to a Mortgage is located in a jurisdiction which
imposes mortgage recording taxes, intangibles tax, documentary tax or similar recording fees or taxes, the relevant
Mortgage shall not secure an amount in excess of the fair market value of such property subject thereto;
(B)
fully paid Mortgage Policies or signed commitments in respect thereof together with such
affidavits, certificates, and instruments of indemnification (including a
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so-called “gap” indemnification) as shall be required to induce the title insurance company to issue the Mortgage
Policies and endorsements contemplated above and evidence of payment of title insurance premiums and expenses and
all recording, mortgage, transfer and stamp taxes and fees payable in connection with recording the Mortgage;
(C)
customary opinions of local counsel for such Loan Party in the state in which such Material Real
Property is located, with respect to the enforceability of the Mortgage and any related fixture filings and, where the
applicable Loan Party granting the Mortgage on said Mortgaged Property is incorporated and/or organized, an opinion
regarding the due authorization, execution and delivery of such Mortgage, and in each case, such other matters as may
be reasonably requested by the Administrative Agent;
(D)
an ALTA survey or existing survey together with a no change affidavit of such Mortgaged
Property, sufficient for the title insurance company to remove the standard survey exception and issue survey-related
endorsements and otherwise reasonably satisfactory to the Administrative Agent (if reasonably requested by the
Administrative Agent); and
(E)
a completed “life of loan” Federal Emergency Management Agency standard flood hazard
determination;
provided that without limiting the obligations set forth above, the Administrative Agent and the Collateral Agent will consult in
good faith with the Borrower to reduce any stamp, filing or similar taxes imposed as a result of the actions described in the foregoing
provisions;
Section 6.12
Further Assurances
. Subject to Section 6.11 and any applicable limitations in any Collateral Document, and in each case at the expense of the
Borrower, promptly upon the reasonable request by the Administrative Agent or Collateral Agent (a) correct any material defect or error that
may be discovered in the execution, acknowledgment, filing or recordation of any Collateral Document or other document or instrument
relating to any Collateral and (b) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register any and all such
further acts, deeds, certificates, assurances and other instruments as the Administrative Agent or Collateral Agent may reasonably request
from time to time in order to carry out more effectively the purposes of the Collateral Documents.
Notwithstanding anything to the contrary in any Loan Document, other than with respect to the Equity Interests and assets of any Foreign
Subsidiary that becomes a Loan Party, neither Holdings, the Borrower, nor any Restricted Subsidiary will be required to, nor will the
Administrative Agent or the Collateral Agent be authorized,
(a)
to perfect security interests in the Collateral other than by,
(i)
“all asset” filings pursuant to the Uniform Commercial Code in the office of the secretary of state (or similar
central filing office) of the relevant state(s);
(ii)
filings in (A) the United States Patent and Trademark Office with respect to any U.S. issued or applied for
patents and registered or applied for trademarks and (B) the United States Copyright Office of the Library of Congress with
respect to material copyright registrations, in the case of each of (A) and (B), constituting Collateral;
(iii)
mortgages in respect of Material Real Property; and
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(iv)
delivery to the Administrative Agent or Collateral Agent (or a bailee of the Administrative Agent or
Collateral Agent) to be held in its possession of all Collateral consisting of (A) certificates representing Pledged Equity,
(B) promissory notes and other instruments constituting Collateral, in each case, in the manner provided in the Collateral
Documents; provided that promissory notes and instruments having an aggregate principal amount equal to the Materiality
Threshold Amount or less need not be delivered to the Collateral Agent;
(b)
to enter into any control agreement, lockbox or similar arrangement with respect to any deposit account, securities
account, commodities account or other bank account, or otherwise take or perfect a security interest with control;
(c)
except with respect to any Foreign Subsidiary designated as a Guarantor pursuant to the definition of “Excluded
Subsidiary” and the Equity Interests of such Foreign Subsidiary, to take any action (i) outside of the United States with respect to any assets
located outside of the United States, (ii) in any non-U.S. jurisdiction or (iii) required by the laws of any non-U.S. jurisdiction to create,
perfect or maintain any security interest or otherwise; or
(d)
to take any action with respect to perfecting a Lien with respect to letters of credit, letter of credit rights, commercial
tort claims, chattel paper or assets subject to a certificate of title or similar statute (in each case, other than the filing of customary “all asset”
UCC-1 financing statements) or to deliver landlord lien waivers, estoppels, bailee letters or collateral access letters, in each case, unless
required by the terms of the Security Agreement or the relevant Collateral Document.
Further, the Loan Parties shall not be required to perform any periodic collateral reporting, if any, with any frequency greater than
once per fiscal year (provided that this clause shall not limit the obligation of the Loan Parties to comply with Section 6.02(c) or
Section 6.11).
Section 6.13
Designation of Subsidiaries
. The Borrower may at any time designate any Restricted Subsidiary as an Unrestricted Subsidiary or designate (or re-designate, as
the case may be) any Unrestricted Subsidiary as a Restricted Subsidiary; provided that:
(a)
immediately before and after such designation (or re-designation), no Specified Event of Default shall have occurred
and be continuing;
(b)
on a Pro Forma basis after giving effect to such designation, the Borrower is in compliance with the covenant set forth
in Section 8.01 of the ABL Credit Agreement, regardless of such such covenant is required to be tested at such time pursuant to the ABL
Credit Agreement;
(c)
the Investment resulting from the designation of such Restricted Subsidiary as an Unrestricted Subsidiary as described
above is permitted by Section 7.02; and
(d)
no Subsidiary may be designated as an Unrestricted Subsidiary unless it is also designated as an “unrestricted
subsidiary” under the Senior Secured Notes Indenture and the ABL Credit Agreement.
The designation of any Subsidiary as an Unrestricted Subsidiary shall constitute an Investment by the Borrower therein at the date of
designation in an amount equal to the fair market value of the Borrower’s or its Restricted Subsidiary’s (as applicable) Investment(s) to date
therein. The designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of
any Indebtedness and Liens of such Subsidiary existing at such time and a return on any Investment by the Borrower in Unrestricted
Subsidiaries pursuant to the preceding sentence in an amount equal to the fair market value at the date of such designation of the Borrower’s
or its Restricted Subsidiary’s (as applicable)
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Investment in such Subsidiary. Except as set forth in this paragraph, no Investment will be deemed to exist or have been made, and no
Indebtedness or Liens shall be deemed to have been incurred or exist, by virtue of a Subsidiary becoming an Excluded Subsidiary or an
Excluded Subsidiary becoming a Restricted Subsidiary. For all purposes hereunder, the designation of a Subsidiary as an Unrestricted
Subsidiary shall be deemed to constitute a concurrent designation of any Subsidiary of such Subsidiary as an Unrestricted Subsidiary.
Notwithstanding the foregoing, (i) no Restricted Subsidiary that owns material intellectual property shall be designated as an Unrestricted
Subsidiary pursuant to this Section 6.13 and (ii) no Unrestricted Subsidiary shall own any material intellectual property.
Section 6.14
Maintenance of Ratings
. Use commercially reasonable efforts to maintain (a) a public corporate credit rating or public corporate family rating, as
applicable, from any two of S&P, Moody’s and Fitch, in each case, in respect of the Borrower (but not a specific rating), and (b) a public
rating in respect of the Initial Term Loans from any two of S&P, Moody’s and Fitch (but not a specific rating).
Section 6.15
Post-Closing Matters
. The Borrower will, and will cause each of its Restricted Subsidiaries to, take each of the actions set forth on Schedule 6.15 within
the time period prescribed therefor on such schedule (as such time period may be extended by the Administrative Agent).
Section 6.16
Use of Proceeds
. The proceeds of the Initial Term Loans will be used on the Closing Date to finance, in part, the Transactions. The proceeds of the
Delayed Draw Term Loans will be used to redeem all or a portion of the Existing Notes and to pay transaction costs with respect thereto and
with respect to the related Borrowings of Delayed Draw Term Loans.
Section 6.17
Change in Nature of Business
. Engage only in material lines of business that are substantially consistent with those lines of business conducted by the Borrower
and the Restricted Subsidiaries on the Closing Date and lines of business that are reasonably similar, corollary, ancillary, incidental,
synergistic, complementary or related to, or a reasonable extension, development or expansion of, the businesses conducted or proposed to be
conducted by the Borrower and the Restricted Subsidiaries on the Closing Date, in each case as determined by the Borrower in good faith.
Section 6.18
Company Specified Representations
. On the Closing Date, upon the release of each Loan Document to be executed by the Post-Closing Loan Parties from escrow in
accordance with Section 6.15, each Post-Closing Loan Party will make the Company Specified Representations with respect to itself, and
such Company Specified Representations shall be true and accurate in all material respects (except for representations and warranties already
qualified by materiality, which representations and warranties will be true and accurate in all respects).
.
ARTICLE VII.
NEGATIVE COVENANTS
So long as the Termination Conditions are not satisfied, the Borrower shall not (and, with respect to Section 7.10 only, Holdings
shall not), nor shall the Borrower permit any Restricted Subsidiary to:
Section 7.01
Liens
. Create, incur, assume or suffer to exist any Lien upon any of its property, assets or revenues, whether now owned or hereafter
acquired, that secures Indebtedness other than the following:
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(a)
Liens securing obligations in respect of Indebtedness incurred pursuant to Section 7.03(a), including obligations under
any Loan Document, Incremental Loans and Extended Loans;
(b)
Liens securing obligations in respect of Indebtedness incurred pursuant to Section 7.03(b), including obligations with
respect to the Senior Secured Notes Indenture and obligations with respect to ABL Credit Facility;
(c)
Liens existing on the Closing Date (other than Liens incurred under Sections 7.01(a) and 7.01(b));
(d)
Liens securing obligations in respect of Indebtedness permitted under Section 7.03(d), including in respect to
Attributable Indebtedness, Capitalized Lease Obligations, and Indebtedness financing the acquisition, construction, repair, replacement or
improvement of fixed or capital assets; provided that (i) such Liens attach concurrently with or within two hundred and seventy days after
completion of the acquisition, construction, repair, replacement or improvement (as applicable) of the property subject to such Liens and
(ii) such Liens do not at any time extend to or cover any assets (except for additions and accessions to such assets, replacements and products
thereof and customary security deposits) other than the assets subject to, or acquired, constructed, repaired, replaced or improved with the
proceeds of such Indebtedness; provided that individual financings of equipment provided by one lender may be cross collateralized to other
financings of equipment provided by such lender or its affiliates or branches;
(e)
(f)
Liens in favor of a Loan Party securing Indebtedness permitted under Section 7.03;
Liens securing (i) Obligations in respect of any Secured Hedge Agreement, (ii) obligations in respect of any Secured
Hedge Agreement (as defined in the ABL Credit Agreement) and (iii) other Indebtedness permitted by Section 7.03(f);
(g)
(h)
Liens on assets of Non-Loan Parties securing obligations of such Non-Loan Parties and Liens on Excluded Assets;
Liens securing obligations in respect of Permitted Pari Passu Secured Refinancing Debt or Permitted Junior Secured
Refinancing Debt and any Permitted Refinancing of any of the foregoing incurred pursuant to Section 7.03(h);
(i)
Liens securing obligations in respect of Incremental Equivalent Debt (with the lien priority permitted in such definition
and other than to the extent such Indebtedness is only permitted to be incurred as unsecured Indebtedness) and other Indebtedness incurred
pursuant to Section 7.03(i); provided that such Liens securing such other Indebtedness are permitted by Section 7.01(ll)(i);
(j)
Liens securing obligations in respect of Permitted Ratio Debt (with the lien priority permitted in such definition and
other than to the extent such Indebtedness is only permitted to be incurred as unsecured Indebtedness) and other Indebtedness permitted by
Sections 7.03(j); provided that such Liens securing such other Indebtedness are permitted by Section 7.01(ll)(i);
(k)
Liens on property or assets contributed to capital of the Borrower or a Subsidiary Guarantor or received in exchange for
Equity Interests of the Borrower or a Parent Entity made after the Closing Date solely to the extent Not Otherwise Applied;
(l)
(i) Liens existing on property at the time of (and not in contemplation of) its acquisition or existing on the property of
any Person or on Equity Interests of any Person, in each case, at the time such
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Person becomes (and not in contemplation of such Person becoming) a Restricted Subsidiary, in each case after the Closing Date; provided
that (A) such Lien does not extend to or cover any other assets or property (other than (1) after-acquired property covered by any applicable
grant clause, (2) property that is affixed or incorporated into the property covered by such Lien and (3) proceeds and products of assets
covered by such Liens), (B) such Lien does not encumber any assets of the Borrower or its Restricted Subsidiaries other than the assets
acquired in such transaction and (C) the Indebtedness secured thereby is permitted under Section 7.03, (ii) Liens on any cash earnest money
deposits made by the Borrower or any of the Restricted Subsidiaries in connection with any letter of intent or purchase agreement relating to
an Investment and (iii) Liens incurred in connection with escrow arrangements or other agreements relating to an Acquisition Transaction or
Investment permitted hereunder;
(m)
Liens (i) on cash advances in favor of the seller of any property to be acquired in an Investment permitted pursuant to
Section 7.02 to be applied against the purchase price for such Investment or (ii) consisting of an agreement to Dispose of any property in a
Disposition, in each case, solely to the extent such Investment or Disposition, as the case may be, would have been permitted on the date of
the creation of such Lien;
(n)
(i) pledges or deposits in the ordinary course of business in connection with workers’ compensation, health, disability
or employee benefits, unemployment insurance and other social security laws or similar legislation or regulation or other insurance-related
obligations (including in respect of deductibles, self-insured retention amounts and premiums and adjustments thereto) and (ii) pledges and
deposits in the ordinary course of business securing liability for reimbursement 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
Holdings, the Borrower or any Restricted Subsidiaries;
(i) Liens on insurance policies and the proceeds thereof securing the financing of the premiums with respect thereto and
(ii) Liens on cash securing obligations to insurance companies with respect to insurable liabilities incurred in the ordinary course of business;
(o)
(p)
deposits to secure the performance of bids, trade contracts, governmental contracts and leases (other than Indebtedness
for borrowed money), statutory obligations, surety, stay, customs and appeal bonds, performance bonds and other obligations of a like nature
(including those to secure health, safety and environmental obligations) incurred in the ordinary course of business;
(q)
(r)
Liens on the Securitization Assets arising in connection with a Qualified Securitization Financing;
Liens in respect of the cash collateralization of letters of credit;
(s)
Liens (i) of a collection bank arising under Section 4-208 or 4-210 of the Uniform Commercial Code on the items in the
course of collection, (ii) attaching to commodity trading accounts or other commodities brokerage accounts incurred in the ordinary course of
business and not for speculative purposes and (iii) in favor of a banking or other financial institution arising as a matter of law encumbering
deposits or other funds maintained with a financial institution (including the right of setoff) and that are within the general parameters
customary in the banking industry;
(t)
Liens securing Cash Management Obligations and Cash Management Obligations (as defined in the ABL Credit
Agreement), in each case, as permitted by Section 7.03;
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(u)
Liens that are customary contractual rights of setoff (i) relating to the establishment of depository relations with banks
or other deposit-taking financial institutions in the ordinary course of business (and, for the avoidance of doubt, not given in connection with
the issuance of Indebtedness), (ii) relating to pooled deposit or sweep accounts of Holdings, the Borrower or any of the Restricted
Subsidiaries to permit satisfaction of overdraft or similar obligations incurred in the ordinary course of business or (iii) relating to purchase
orders and other agreements entered into with customers of the Borrower or any of the Restricted Subsidiaries in the ordinary course of
business;
(v)
statutory or common law Liens of landlords, carriers, warehousemen, mechanics, materialmen, repairmen, construction
contractors or other like Liens, or other customary Liens (other than in respect of Indebtedness) in favor of landlords, so long as, in each case,
such Liens arise in the ordinary course of business and secure amounts not overdue for a period of more than sixty days or, if more than sixty
days overdue, are unfiled and no other action has been taken to enforce such Lien or that are being contested in good faith and by appropriate
actions, if adequate reserves with respect thereto are maintained on the books of the applicable Person in accordance with GAAP;
(w)
any interest or title of a lessor, sublessor, licensor or sublicensor or secured by a lessor’s, sublessor’s, licensor’s or
sublicensor’s interest under leases or licenses entered into by the Borrower or any of the Restricted Subsidiaries as lessee or licensee in the
ordinary course of business;
(x)
ground leases in respect of real property on which facilities owned or leased by the Borrower or any of its Subsidiaries
are located;
(y)
any zoning or similar law or right reserved to or vested in any Governmental Authority to control or regulate the use of
any real property that does not materially interfere with the ordinary conduct of the business of the Borrower and the Restricted Subsidiaries,
taken as a whole;
(z)
deposits of cash with the owner or lessor of premises leased and operated by the Borrower or any of the Restricted
Subsidiaries in the ordinary course of business to secure the performance of the Borrower’s or a Restricted Subsidiary’s obligations under the
terms of the lease for such premises;
(aa)
(i) Liens for taxes, assessments or governmental charges that are not overdue for a period of more than sixty days or
that are being contested in good faith and by appropriate actions diligently conducted and for which appropriate reserves have been
established in accordance with GAAP or that are not expected to result in a Material Adverse Effect and (ii) Liens for property taxes on
property the Borrower or its Subsidiaries has decided to abandon if the sole recourse for such tax, assessment or charge is to such property;
(bb)
easements, rights-of-way, restrictions (including zoning restrictions), encroachments, protrusions and other similar
encumbrances and title defects affecting real property that, in the aggregate, do not in any case materially interfere with the ordinary conduct
of the business of the Borrower and the Restricted Subsidiaries taken as a whole, or the use of the property for its intended purpose and any
other exceptions to title on the Mortgage Policies provided in accordance with this Agreement;
(cc)
Liens arising from judgments or orders for the payment of money not constituting an Event of Default under
Section 8.01(g);
(dd)
leases, licenses, subleases or sublicenses granted to others in the ordinary course of business (including any other
agreement under which the Borrower or any Restricted Subsidiary has granted rights to end users to access and use the Borrower’s or any
Restricted Subsidiary’s products, technologies,
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facilities or services) which do not interfere in any material respect with the business of the Borrower and the Restricted Subsidiaries, taken
as a whole;
(ee)
Liens (i) in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in
connection with the importation of goods in the ordinary course of business and (ii) on specific items of inventory or other goods and
proceeds thereof of any Person securing such Person’s obligations in respect of bankers’ acceptances or documentary letters of credit issued
or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or such other goods in the ordinary
course of business;
(ff)
Liens arising out of conditional sale, title retention, consignment or similar arrangements for sale of goods entered into
by the Borrower or any of the Restricted Subsidiaries in the ordinary course of business;
(gg)
Liens imposed by law or incurred pursuant to customary reservations or retentions of title (including contractual Liens
in favor of sellers and suppliers of goods) incurred in the ordinary course of business for sums not constituting borrowed money that are not
overdue for a period of more than sixty days or that are being contested in good faith by appropriated proceedings and for which adequate
reserves have been established in accordance with GAAP (if so required);
(hh)
Liens deemed to exist in connection with Investments in repurchase agreements and reasonable customary initial
deposits and margin deposits and similar Liens attaching to commodity trading accounts or other brokerage accounts maintained in the
ordinary course of business and not for speculative purposes;
(ii)
Liens on cash and Cash Equivalents earmarked to be used to satisfy or discharge Indebtedness where such satisfaction
or discharge of such Indebtedness is not otherwise prohibited by this Agreement;
(jj)
purported Liens evidenced by the filing of precautionary Uniform Commercial Code or PPSA financing statements or
similar public filings;
(kk)
the modification, replacement, renewal or extension of any Lien permitted by this Section 7.01; provided that (i) the
Lien does not extend to any additional property, other than (A) after-acquired property covered by any applicable grant clause, (B) property
that is affixed or incorporated into the property covered by such Lien and (C) proceeds and products of assets covered by such Liens, and
(ii) the renewal, extension or refinancing of the obligations secured or benefited by such Liens is permitted by Section 7.03;
(ll)
Liens securing:
(i)
a Permitted Refinancing of Indebtedness; provided that:
(A)
(B)
(C)
such Indebtedness was permitted by Section 7.03 and was secured by a Permitted Lien;
such Permitted Refinancing is permitted by Section 7.03; and
the Lien does not extend to any additional property, other than (A) after-acquired property covered
by any applicable grant clause, (B) property that is affixed or
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incorporated into the property covered by such Lien and (C) proceeds and products of assets covered by such Liens;
and
(ii)
Guarantees permitted by Section 7.03 to the extent that the underlying Indebtedness subject to such
Guarantee is permitted to be secured by a Lien;
(mm)
Liens securing Pari Passu Lien Debt and/or Junior Lien Debt; provided that:
(i)
such Indebtedness is incurred pursuant to clause (a)(i) or (a)(ii) of the definition of “Permitted Ratio Debt”;
and
(ii)
such Liens (other than with respect to purchase money and similar obligations) are, in each case, (x) to the
extent such Indebtedness is required to be subject to the provisions of the Closing Date ABL Intercreditor Agreement, a Debt
Representative acting on behalf of the holders of such Indebtedness has become party to, or is otherwise subject to the provisions
of the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that may be executed from time to time and
reasonably acceptable to the Administrative Agent and (y) subject to an Equal Priority Intercreditor Agreement or Junior Lien
Intercreditor Agreement, as applicable;
(nn)
Liens securing Indebtedness or other obligations in an aggregate principal amount as of the date such Indebtedness is
incurred not to exceed the greater of (A) 25.00% of Closing Date EBITDA and (B) 25.00% of TTM Consolidated Adjusted EBITDA as of
the applicable date of determination, in each case, determined as of the date such Indebtedness is incurred (or commitments with respect
thereto are received); provided that it is agreed that Liens incurred pursuant to this clause (nn) may be pari passu with the Liens securing the
Facilities under this Agreement; and
(oo)
Liens in respect of the cash collateralization of corporate credit card programs; provided that the aggregate amount of
such cash securing such obligations shall not exceed $15,000,000.
For purposes of determining compliance with this Section 7.01, in the event that any Lien (or any portion thereof) meets the
criteria of more than one of the categories set forth above, the Borrower may, in its sole discretion, at the time of incurrence, divide, classify
or reclassify, or at any later time divide, classify or reclassify, such Lien (or any portion thereof) in any manner that complies with this
covenant on the date such Lien is incurred or such later time, as applicable; provided that all Liens securing Indebtedness under (a) the Loan
Documents will be deemed to have been incurred in reliance on the exception in Section 7.01((a)) and (b) the Senior Secured Notes Indenture
and the ABL Credit Agreement, in each case on the Closing Date will be deemed incurred in reliance on the exception in Section 7.01(b),
and shall not be permitted to be reclassified pursuant to this paragraph. With respect to any Liens securing Indebtedness that was permitted to
be incurred hereunder on the date of such incurrence, any Lien securing the Increased Amount of such Indebtedness shall also be permitted
hereunder after the date of such incurrence.
Any Lien incurred in compliance with this Section 7.01 after the Closing Date that is intended to be secured on a pari passu basis
with the Obligations will be subject to an Equal Priority Intercreditor Agreement, and any Lien incurred in compliance with this Section 7.01
on or after the Closing Date that is intended by the Borrower to be secured on a contractually junior basis will be subject to a Junior Lien
Intercreditor Agreement and all such Liens, to the extent required to be subject to the provisions of the Closing Date ABL Intercreditor
Agreement, will be subject to the Closing Date ABL Intercreditor Agreement or any other intercreditor agreement that may be executed from
time to time and reasonably acceptable to the Administrative Agent.
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Section 7.02
Investments
. Make any Investments, except:
(a)
Investments,
(i)
by the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary; and
(ii)
by the Borrower or any Restricted Subsidiary in a Person, if as a result of such Investment (A) such Person
becomes a Restricted Subsidiary or (B) such Person is merged, consolidated or amalgamated with or into, or transfers or conveys
substantially all of its assets to, or is liquidated into, the Borrower or a Restricted Subsidiary;
provided that the aggregate amount of any Investment pursuant to this Section 7.02(a) in any Restricted Subsidiary that is not a
Loan Party, together with any Permitted Acquisitions pursuant to 7.02(c) of any entity that is not (or does not become) a Loan Party, does not
exceed in the aggregate the greater of (i) 50.00% of Closing Date EBITDA and (ii) 50.00% of TTM Consolidated Adjusted EBITDA as of
the applicable date of determination;
(b)
Investments existing on the Closing Date or made pursuant to legally binding written contracts in existence on the
Closing Date and any modification, replacement, renewal, reinvestment or extension of any of the foregoing; provided that the amount of any
Investment permitted pursuant to this Section 7.02(b) is not increased from the amount of such Investment on the Closing Date except
pursuant to the terms of such Investment as of the Closing Date or as otherwise permitted by another clause of this Section 7.02;
(c)
Permitted Acquisitions; provided that the aggregate amount of any Permitted Acquisition pursuant to this Section
7.02(c) of any entity that is not (or does not become) a Loan Party, together with Investments pursuant to Section 7.02(a) in any Restricted
Subsidiaries that are not Loan Parties, does not exceed in the aggregate the greater of (i) 50.00% of Closing Date EBITDA and (ii) 50.00% of
TTM Consolidated Adjusted EBITDA as of the applicable date of determination;
(d)
Investments (i) held by a Restricted Subsidiary acquired after the Closing Date or of a Person merged, amalgamated or
consolidated with or into the Borrower or merged, amalgamated or consolidated with or into a Restricted Subsidiary (or committed to be
made by any such Person) to the extent that, in each case, such Investments or any such commitments 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,
amalgamation or consolidation and (ii) held by Persons that become Restricted Subsidiaries after the Closing Date, including Investments by
Unrestricted Subsidiaries made or acquired (or committed to be made or acquired), to the extent that such Investments were not made or
acquired (or committed to be made or acquired) in contemplation of, or in connection with, such Person becoming a Restricted Subsidiary or
such designation as applicable;
(e)
Investments in Similar Businesses that do not exceed in the aggregate the greater of (i) 25.00% of Closing Date
EBITDA and (ii) 25.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination; provided that if any Investment
pursuant to this clause (e) is made in any Person that is not the Borrower or a Restricted Subsidiary on the date of such Investment (prior to
giving effect thereto) and such Person subsequently becomes the Borrower or a Restricted Subsidiary, the Investment initially made in such
Person pursuant to this clause (e) shall thereupon be deemed to have been made pursuant to clause (a)(i) hereof and to not have been made
pursuant to this clause (e) for so long as such Person continues to be the Borrower or a Restricted Subsidiary;
139
(f)
(g)
[reserved];
Investments to the extent that payment for such Investments is made solely with Qualified Equity Interests of Holdings
(or any Parent Entity) or the proceeds from the issuance thereof;
(h)
Joint Venture Investments;
(i)
loans and advances to Holdings (or any Parent Entity) in lieu of, and not in excess of the amount of (after giving effect
to any other loans, advances or Restricted Payments in respect thereof) Restricted Payments permitted to be made to Holdings (or such Parent
Entity) in accordance with Section 7.06;
(j)
loans or advances to any Company Person;
(i)
for reasonable and customary business-related travel, entertainment, relocation and analogous ordinary
business purposes;
(ii)
in connection with such Person’s purchase of Equity Interests of Holdings (or any Parent Entity); provided
that, to the extent such loans or advances are made in cash, the amount of such loans and advances used to acquire such Equity
Interests shall be contributed to Holdings in cash; and
(iii)
for any other purpose; provided that either (A) no cash or Cash Equivalents are advanced in connection with
such Investment or (B) the aggregate principal amount outstanding under this clause (iii)(B) shall not exceed the greater of (1)
10.00% of Closing Date EBITDA and (2) 10.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of
determination;
(k)
Investments in Hedge Agreements;
(l)
constituting a Disposition;
promissory notes and other Investments received in connection with Dispositions or any other transfer of assets not
(m)
Investments in assets that are cash or Cash Equivalents or were Cash Equivalents when made;
(n)
Investments consisting of extensions of trade credit or otherwise made in the ordinary course of business, including
Investments consisting of endorsements for collection or deposit and trade arrangements with customers, vendors, suppliers, licensors and
licensees;
(o)
Investments consisting of Liens, Indebtedness (including Guarantees), fundamental changes, Dispositions and
Restricted Payments permitted under Sections 7.01, 7.03, 7.04 (other than clause (f) thereof), 7.05 (other than clause (e) thereof) and 7.06
(other than clauses (d) and (h)(iv) hereof), respectively;
(p)
Investments (i) received in connection with the bankruptcy, workout, recapitalization or reorganization of, or in
settlement of delinquent obligations of, or other disputes with, any other Person who is not an Affiliate of the Borrower, (ii) received in
connection with the foreclosure of any secured Investment or other transfer of title with respect to any secured Investment, (iii) in satisfaction
of judgments against other Persons who are not Affiliates of the Borrower, (iv) as a result of the settlement, compromise or resolutions of
litigation, arbitration or other disputes with Persons who are not Affiliates of the Borrower
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and (v) received in satisfaction or partial satisfaction of trade credit and other credit extended in the ordinary course of business, including to
vendors and suppliers;
(q)
(r)
advances of payroll or other payments to any Company Person;
Investments consisting of purchases and acquisitions of inventory, supplies, material, services or equipment or the
licensing or contribution of Intellectual Property pursuant to joint marketing arrangements with other Persons;
(s)
Investments made in connection with obtaining, maintaining or renewing client contracts and loans or advances made
to distributors, vendors, suppliers, licensors and licensees;
thereby;
(t)
(u)
(v)
Guarantees of leases (other than Capitalized Leases) or of other obligations that do not constitute Indebtedness;
Investments in connection with any Permitted Reorganization and the transactions relating thereto or contemplated
Investments in connection with any deferred compensation plan or arrangement or other compensation plan or
arrangement, including to a “rabbi” trust or to any grantor trust claims of creditors;
(w)
in the event that the Borrower or any Restricted Subsidiary makes any Investment after the Closing Date in any Person
that is not a Restricted Subsidiary and such Person subsequently becomes a Restricted Subsidiary, additional Investments in an amount equal
to the fair market value of such Investment as of the date on which such Person becomes a Restricted Subsidiary;
(x)
(y)
[reserved];
unfunded pension fund and other employee benefit plan obligations and liabilities to the extent that such obligations
and/or liabilities, as applicable, are permitted to remain unfunded under applicable law;
(z)
Investments in connection with intercompany cash management services, treasury arrangements and any related
activities;
(aa)
Investments consisting of (i) the licensing or contribution of Intellectual Property pursuant to joint marketing,
collaborations or other similar arrangements with other Persons and/or (ii) minority equity interests in customers received as part of fee
arrangements or other commercial arrangements;
(bb)
the conversion to Qualified Equity Interests of any Indebtedness owed by the Borrower or any Restricted Subsidiary;
(cc)
(i) Investments in a Securitization Subsidiary or any Investment by a Securitization Subsidiary in any other Person in
connection with a Qualified Securitization Financing; provided however, that any such Investment in a Securitization Subsidiary is of
Securitization Assets or equity, and (ii) distributions or payments of Securitization Fees and purchases of Securitization Assets pursuant to a
Securitization Repurchase Obligation in connection with a Qualified Securitization Financing;
(dd)
(ee)
[reserved];
[reserved];
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(ff)
Investments made pursuant to the Acquisition Agreement in connection with the Transactions on, or substantially
concurrent with, the Closing Date;
(gg)
Investments; provided that the Total Net Leverage Ratio (after giving Pro Forma Effect to the incurrence of such
Investment) for the Test Period immediately preceding the making of such Investment shall be less than or equal to the Closing Date Total
Net Leverage Ratio less 1.50 to 1.00; provided that no Specified Event of Default has occurred or is continuing or would result therefrom;
(hh)
Investments that do not exceed in the aggregate at any time outstanding the sum of:
(i)
the Available Amount at such time; provided that no Specified Event of Default shall have occurred and be
continuing or would result therefrom; and
(ii)
the greater of (A) 30% of Closing Date EBITDA and (B) 30% of TTM Consolidated Adjusted EBITDA as of
the applicable date of determination.
If any Investment is made in any Person that is not a Restricted Subsidiary on the date of such Investment and such
Person subsequently becomes a Restricted Subsidiary, such Investment shall thereupon be deemed to have been made pursuant to
Section 7.02(a)(i) and to not have been made pursuant to any other clause set forth above.
Notwithstanding the foregoing, none of Holdings, the Borrower or any Restricted Subsidiary shall transfer (whether by sale,
contribution, dividend or otherwise), material intellectual property to any Unrestricted Subsidiary.
For purposes of determining compliance with this Section 7.02, in the event that any Investment (or any portion thereof) meets the
criteria of more than one of the categories set forth above, the Borrower may, in its sole discretion, at the time such Investment is made,
divide, classify or reclassify, or at any later time divide, classify or reclassify, such Investment (or any portion thereof) in any manner that
complies with this covenant on the date such Investment is made or such later time, as applicable.
The amount of any Investment at any time shall be the amount of cash and the fair market value of other property actually invested
(measured at the time made), without adjustment for subsequent changes in the value of such Investment at the Borrower’s option, net of any
return, whether a return of capital, interest, dividend or otherwise, with respect to such Investment. To the extent any Investment in any
Person is made in compliance with this Section 7.02 in reliance on a category above that is subject to a Dollar-denominated restriction on the
making of Investments and, subsequently, such Person returns to the Borrower or any Restricted Subsidiary all or any portion of such
Investment (in the form of a dividend, distribution, liquidation or otherwise, but excluding intercompany Indebtedness), such return shall be
deemed to be credited to the Dollar-denominated category against which the Investment is then charged. To the extent the category subject to
a Dollar-denominated restriction is also subject to a percentage of TTM Consolidated Adjusted EBITDA restriction which, at the date of
determination, produces a numerical restriction that is greater than such Dollar Amount, then such Dollar equivalent shall be deemed to be
substituted in lieu of the corresponding Dollar Amount in the foregoing sentence for purposes of determining such credit.
For purposes of determining compliance with any Dollar-denominated (or percentage of TTM Consolidated Adjusted EBITDA, if
greater) restriction on the making of Investments, the Dollar equivalent amount of the Investment denominated in a foreign currency shall be
calculated based on the relevant currency exchange rate in effect on the date such Investment was made.
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Section 7.03
Indebtedness
. Create, incur or assume any Indebtedness, other than:
(a)
(b)
Indebtedness under the Loan Documents (including Incremental Loans and Extended Loans);
Indebtedness in respect of
(i)
(A) the Senior Secured Notes Documents incurred on the Closing Date in an aggregate principal amount not
to exceed $775,000,000 and (B) any Permitted Refinancing thereof;
(ii)
(A) Indebtedness incurred pursuant to the ABL Loan Documents (including the issuances of letters of credit
thereunder) in an aggregate principal amount not to exceed the greater of (x)(1) $400,000,000 plus (2) the greater of 50% of
Closing Date EBITDA and 50% of TTM Consolidated Adjusted EBITDA and (y) the Borrowing Base (as defined in the ABL
Credit Agreement, without giving effect to any eligibility or reserve provisions therein), measured at the time of the incurrence of
such Indebtedness and (B) any Permitted Refinancing in respect of the foregoing clause (A);
(c)
Indebtedness existing on the Closing Date (other than Indebtedness under the Senior Secured Notes Indenture and the
ABL Credit Agreement) and any Permitted Refinancing thereof, including any intercompany Indebtedness of Holdings, the Borrower or any
Restricted Subsidiary outstanding on the Closing Date;
(d)
(i) (A) Attributable Indebtedness relating to any transaction, (B) Capitalized Leases and other Indebtedness financing
the acquisition, construction, repair, replacement or improvement of fixed or capital assets, whether through the direct purchase of assets or
the Equity Interests of any Person owning such assets, so long as such Indebtedness is incurred concurrently with, or within two-hundred and
seventy days after, the applicable acquisition, construction, repair, replacement or improvement and (C) Indebtedness arising from the
conversion of obligations of the Borrower or any Restricted Subsidiary under or pursuant to any “synthetic lease” transactions to
Indebtedness of the Borrower or such Restricted Subsidiary; provided that the aggregate principal amount of such Indebtedness at the time
any such Indebtedness is incurred pursuant to this Section 7.03(d) shall not exceed the greater of (I) 25.00% of Closing Date EBITDA and
(II) 25.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination, in each case determined at the time of
incurrence, (ii) Attributable Indebtedness incurred in connection with a Sale Leaseback Transaction otherwise permitted hereunder and
(iii) any Permitted Refinancing of any Indebtedness incurred under this Section 7.03(d); provided that for the purposes of determining
compliance with this Section 7.03(d), any lease that is not treated under GAAP as a capital lease at the time such lease is executed but is
subsequently treated under GAAP as a capitalized lease as the result of a change in GAAP (or interpretations thereof) after the Closing Date
shall not be treated as Indebtedness;
(e)
Indebtedness of the Borrower or any of the Restricted Subsidiaries owing to the Borrower or any other Restricted
Subsidiary; provided that all such Indebtedness of any Loan Party owed to any Restricted Subsidiary that is not a Loan Party shall be subject
to the Global Intercompany Note (but only to the extent permitted by applicable law);
(f)
Indebtedness in respect of (i) Obligations under Secured Hedge Agreements, (ii) obligations under Secured Hedge
Agreements (as defined in the ABL Credit Agreement) and (iii) Hedge Agreements designed to hedge against Holdings’, the Borrower’s or
any Restricted Subsidiary’s exposure to interest rates, foreign exchange rates or commodities pricing risks, in each case of clauses (i) through
(ii), incurred not for speculative purposes, and Guarantees thereof;
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(g)
(i) Indebtedness incurred by a Non-Loan Party in an aggregate amount which does not exceed the greater of (A)
25.00% of Closing Date EBITDA and (B) 25.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination and
(ii) Indebtedness that is recourse only to Excluded Assets;
(h)
(i)
(j)
(k)
(l)
Credit Agreement Refinancing Indebtedness and any Permitted Refinancing thereof;
Incremental Equivalent Debt and any Permitted Refinancing thereof;
Permitted Ratio Debt and any Permitted Refinancing thereof;
Contribution Indebtedness and any Permitted Refinancing thereof;
Indebtedness,
(i)
of any Person that becomes a Restricted Subsidiary after the Closing Date pursuant to an Investment or other
Acquisition Transaction permitted hereunder, which Indebtedness is existing at the time such Person becomes a Restricted
Subsidiary and is not incurred in contemplation of such Person becoming a Restricted Subsidiary that is non-recourse to (and is
not assumed by any of) the Borrower, Holdings or any Restricted Subsidiary (other than any Subsidiary of such Person that is a
Subsidiary on the date such Person becomes a Restricted Subsidiary after the Closing Date) and is either (A) unsecured or (B)
secured only by the assets of such Restricted Subsidiary by Liens permitted under Section 7.01; provided, that immediately after
giving effect to the or assumption of such Indebtedness, the Total Net Leverage Ratio for the applicable Test Period is equal to or
less than (1) the Closing Date Total Net Leverage Ratio or (2) the Total Net Leverage Ratio immediately prior to such assumption;
(ii)
any Permitted Refinancing of any of the foregoing;
(m)
Indebtedness incurred in connection with a Permitted Acquisition, Acquisition Transaction or Investment expressly
permitted hereunder or any Disposition, in each case to the extent constituting indemnification obligations or obligations in respect of
purchase price (including earn-outs and seller notes) or other similar adjustments;
(n)
Indebtedness representing deferred compensation to employees of the Borrower and its Subsidiaries incurred in the
ordinary course of business;
(o)
Indebtedness consisting of obligations of the Borrower and the Restricted Subsidiaries under deferred compensation or
other similar arrangements with employees incurred by such Person in connection with the Transactions, Permitted Acquisitions, Acquisition
Transaction or any Investment expressly permitted hereunder (other than pursuant to Section 7.02(o));
(p)
Indebtedness to current or former officers, directors, managers, consultants, and employees, their respective estates,
spouses or former spouses to finance the purchase or redemption of Equity Interests of Holdings (or any Parent Entity) permitted by
Section 7.06;
(q)
Indebtedness in respect of letters of credit, bank guarantees, bankers’ acceptances, warehouse receipts or similar
instruments issued or created in the ordinary course of business, including such Indebtedness that is consistent with past practices in respect
of workers compensation claims, health, disability or other employee benefits or property, casualty or liability insurance or self-insurance or
other
144
Indebtedness with respect to reimbursement-type obligations regarding workers compensation claims and letters of credit that are cash
collateralized;
(r)
Indebtedness consisting of (i) the financing of insurance premiums or (ii) take-or-pay obligations contained in supply
arrangements, in each case, incurred in the ordinary course of business;
(s)
obligations in respect of performance, bid, appeal and surety bonds and performance and completion guarantees and
similar obligations provided by the Borrower or any of the Restricted Subsidiaries or obligations in respect of letters of credit, bank
guarantees or similar instruments related thereto, in each case, in the ordinary course of business or consistent with past practices;
(t)
Indebtedness incurred by a Securitization Subsidiary in a Qualified Securitization Financing that is not recourse (except
for Standard Securitization Undertakings) to the Borrower or any other Loan Party;
(u)
(i) Indebtedness in respect of letters of credit issued for the account of the Borrower or any Restricted Subsidiary so
long as (A) such Indebtedness is not secured by any Lien on Collateral other than Permitted Liens and (B) the aggregate face amount of such
letters of credit does not exceed the greater of (I) 10.00% of Closing Date EBITDA and (II) 10.00% of TTM Consolidated Adjusted
EBITDA, determined at the time of issuance of such letter of credit and (ii) Indebtedness in respect of letters of credit that are fully cash
collateralized;
(v)
(i) obligations in respect of Cash Management Obligations, (ii) Cash Management Obligations (as defined in the ABL
Credit Agreement) and (iii) other Indebtedness in respect of netting services, automatic clearinghouse arrangements, overdraft protections,
employee credit card programs and other cash management and similar arrangements, in each case of clauses (i) through (iii), incurred in the
ordinary course of business or consistent with past practices and any Guarantees thereof;
(w)
Guarantees in respect of Indebtedness of the Borrower or any of the Restricted Subsidiaries otherwise permitted
hereunder; provided that (A) no Guarantee by any Restricted Subsidiary of any Junior Financing shall be permitted unless such Restricted
Subsidiary shall have also provided a Guarantee of the Obligations substantially on the terms set forth in the Guaranty and (B) if the
Indebtedness being Guaranteed is subordinated in right of payment to the Obligations, such Guarantee shall be subordinated to the Guaranty
in right of payment on terms at least as favorable to the Lenders as those contained in the subordination terms with respect to such
Indebtedness;
(x)
Indebtedness incurred on behalf of, or representing Guarantees of Indebtedness of, any Joint Ventures in an aggregate
principal amount not to exceed the greater of (i) 25.00% of Closing Date EBITDA and (ii) 25.00% of TTM Consolidated Adjusted EBITDA
as of the applicable date of determination, determined at the time of incurrence, and any Permitted Refinancing of the foregoing;
(y)
Indebtedness in an aggregate principal amount at any time outstanding not to exceed the the greater of (A) 50% of
Closing Date EBITDA and (B) 50% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination, determined at the
time of incurrence, and any Permitted Refinancing of the foregoing;
(z)
(aa)
the Existing Notes; and
all premiums (if any), interest (including post-petition interest), fees, expenses, charges and additional or contingent
interest on obligations described in clauses (a) through (z) above.
145
For purposes of determining compliance with this Section 7.03, in the event that an item of Indebtedness (or any portion thereof)
meets the criteria of more than one of the categories set forth above, the Borrower may, in its sole discretion, at the time of incurrence, divide,
classify or reclassify, or at any later time divide, classify or reclassify, such item of Indebtedness (or any portion thereof) in any manner that
complies with this covenant on the date such Indebtedness is incurred or such later time, as applicable; provided that all Indebtedness under
(a) the Loan Documents (including any Delayed Draw Term Loans) will be deemed to have been incurred in reliance on the exception in
Section 7.03(a) and (b) Senior Secured Notes and the ABL Credit Agreement on the Closing Date will be deemed incurred in reliance on the
exception in Section 7.03(b), and shall not be permitted to be reclassified pursuant to this paragraph.
For purposes of determining compliance with any Dollar-denominated (or percentage of TTM Consolidated Adjusted EBITDA, if
greater) restriction on the incurrence of Indebtedness, the Dollar equivalent principal amount of Indebtedness denominated in a foreign
currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was incurred, in the case of
term debt, or first committed or first incurred (whichever yields the lower Dollar equivalent), in the case of revolving credit debt; provided
that if such Indebtedness is incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the
applicable Dollar-denominated (or percentage of TTM Consolidated Adjusted EBITDA, if greater) restriction to be exceeded if calculated at
the relevant currency exchange rate in effect on the date of such refinancing, such Dollar-denominated (or percentage of TTM Consolidated
Adjusted EBITDA, if greater) restriction will be deemed not to have been exceeded so long as the principal amount of such refinancing
Indebtedness does not exceed the principal amount of such Indebtedness being refinanced (plus unpaid accrued interest and premium
(including tender premiums) thereon and underwriting discounts, defeasance costs, fees, commissions and expenses in connection therewith).
With respect to any Indebtedness and any related Liens that were permitted to be incurred under the Loan Documents on the date
of such incurrence, any Increased Amount with respect to such Indebtedness after the date of such incurrence shall also be permitted under
the Loan Documents and, for the avoidance of doubt, shall not result in a Default or an Event of Default. The principal amount of any non-
interest bearing Indebtedness or other discount security constituting Indebtedness at any date shall be the principal amount thereof that would
be shown on a balance sheet of the Borrower dated such date prepared in accordance with GAAP. The principal amount of any non-interest
bearing Indebtedness or other discount security constituting Indebtedness at any date shall be the principal amount thereof that would be
shown on a balance sheet of the Borrower dated such date prepared in accordance with GAAP.
Section 7.04
Fundamental Changes
. Merge, dissolve, liquidate, consolidate or amalgamate with or into another Person, or effect a Division, except that:
(a)
Holdings or any Restricted Subsidiary may merge, amalgamate or consolidate with the Borrower (including a merger or
amalgamation, the purpose of which is to reorganize the Borrower into a new jurisdiction); provided that:
(i)
(ii)
the Borrower shall be the continuing or surviving Person;
such merger, amalgamation or consolidation does not result in the Borrower ceasing to be organized under
the Laws of the United States, any state thereof or the District of Columbia; and
(iii)
in the case of a merger, amalgamation or consolidation of Holdings with and into the Borrower, (A) no
Event of Default shall exist at such time or after giving effect to such merger, amalgamation or consolidation, (B) Holdings shall
have no direct Subsidiaries at the time of such
146
merger, amalgamation or consolidation other than the Borrower, (C) after giving effect to such merger, amalgamation or
consolidation, the direct parent of the Borrower shall expressly assume all the obligations of Holdings under this Agreement and
the other Loan Documents to which Holdings is a party pursuant to a supplement hereto or thereto in form reasonably satisfactory
to the Administrative Agent and (D) such direct parent of the Borrower shall concurrently become a Guarantor and pledge 100%
of the Equity Interest of the Borrower to the Administrative Agent as Collateral to secure the Obligations in form reasonably
satisfactory to the Administrative Agent;
(b)
any Restricted Subsidiary may merge, amalgamate or consolidate with or into any other Restricted Subsidiary or
liquidate or dissolve;
(c)
any merger or amalgamation the purpose of which is to reincorporate or reorganize a Restricted Subsidiary in another
jurisdiction shall be permitted;
(d)
any Restricted Subsidiary may liquidate or dissolve or change its legal form; provided (i) no Event of Default shall
result therefrom and (ii) the surviving Person (or the Person who receives the assets of such dissolving or liquidated Restricted Subsidiary)
shall be a Restricted Subsidiary;
(e)
so long as no Default exists or would result therefrom, the Borrower may merge, amalgamate or consolidate with any
other Person; provided that:
(i)
(ii)
the Borrower shall be the continuing or surviving corporation; or
if the Person formed by or surviving any such merger, amalgamation or consolidation is not the Borrower
(any such Person, the “Successor Borrower”);
(A)
the Successor Borrower shall be an entity organized or existing under the laws of the United
States, any state thereof or the District of Columbia;
(B)
the Successor Borrower shall expressly assume all the obligations of the Borrower under this
Agreement and the other Loan Documents to which the Borrower is a party pursuant to a supplement hereto or thereto
in form reasonably satisfactory to the Administrative Agent;
(C)
each Guarantor, unless it is the other party to such merger, amalgamation or consolidation, shall
have by a supplement to the Guaranty confirmed that its Guarantee of the Obligations shall apply to the Successor
Borrower’s obligations under this Agreement;
(D)
each Loan Party, unless it is the other party to such merger, amalgamation or consolidation, shall
have by a supplement to the Security Agreement, confirmed that its obligations thereunder shall apply to the Successor
Borrower’s obligations under this Agreement and the direct parent of such Person shall pledge 100% of the Equity
Interests of such Person to the Administrative Agent as Collateral to secure the Obligations; and
(E)
the Borrower shall have delivered to the Administrative Agent an officer’s certificate and an
opinion of counsel, each stating that such merger, amalgamation or consolidation and such supplement to this
Agreement or any Collateral Document comply with this Agreement, and, with respect to such opinion of counsel only,
including customary organization, due execution, no conflicts and enforceability opinions to the extent reasonably
requested by the Administrative Agent;
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it being agreed that if the foregoing are satisfied, the Successor Borrower will succeed to, and be substituted for, the
Borrower under this Agreement;
(f)
any Restricted Subsidiary may merge, amalgamate or consolidate with any other Person in order to effect an
Investment, Acquisition Transaction or other transaction not prohibited by the Loan Documents (other than any transaction pursuant to
Section 7.02(o));
(g)
Persons; provided that
any Loan Party or any Restricted Subsidiary may conduct a Division that produces two or more surviving or resulting
(i)
if a Division is conducted by the Borrower, then each surviving or resulting Person shall constitute a
“Borrower” for all purposes of the Loan Documents (unless the Administrative Agent otherwise consents in its reasonable
discretion) and shall remain jointly and severally liable for all Obligations (other than Excluded Swap Obligations, where
applicable) of the Borrower immediately prior to such Division and otherwise comply with Section 7.04(e);
(ii)
if a Division is conducted by Holdings, then all of the Equity Interests of the Borrower must be owned by
only one Person that survives or results from such Division, and such Person owning such Equity Interests in the Borrower shall
otherwise comply with Section 7.10(b), become a Guarantor and pledge 100% of the Equity Interests of the Borrower to the
Collateral Agent; and
(iii)
if a Division is conducted by a Loan Party other than the Borrower or Holdings, then each surviving or
resulting Person of such Division shall also be a Loan Party unless and to the extent any such surviving or resulting Loan Party is
the subject of a Disposition permitted pursuant to Section 7.05 (other than Section 7.05(e)) or otherwise would constitute an
Excluded Subsidiary; provided further that such surviving or resulting Person not becoming a Loan Party and the assets and
property of such surviving or resulting Person not becoming Collateral shall, in each case, be treated as an Investment and shall be
permitted under this Section 7.04(g)(iii) solely to the extent permitted under Section 7.02;
(h)
as long as no Default exists or would result therefrom, a merger, amalgamation, dissolution, liquidation, consolidation
or Disposition, the purpose of which is to effect a Disposition permitted pursuant to Section 7.05 or a Permitted Reorganization (other than
Section 7.05(e)); and
(i)
the Transactions may be consummated.
Notwithstanding anything herein to the contrary, in the event of any merger, dissolution, liquidation, consolidation, amalgamation or Division
of any Loan Party or a Restricted Subsidiary effected in accordance with this Section 7.04, the Borrower shall or shall cause, with respect to
each surviving or continuing Restricted Subsidiary (or new direct Parent Entity) (a) promptly deliver or cause to be delivered to the
Administrative Agent for further distribution by the Administrative Agent to each Lender (i) such information and documentation reasonably
requested by the Administrative Agent or any Lender in order to comply with applicable “know your customer” and anti-money laundering
rules and regulations, including the USA PATRIOT Act and (ii) a Beneficial Ownership Certification and (b) do, execute, acknowledge,
deliver, record, re-record, file, re-file, register and re-register any and all such further acts, deeds, certificates, assurances and other
instruments as the Administrative Agent or Collateral Agent may reasonably request in order to perfect or continue the perfection of the
Liens granted or purported to be granted by the Collateral Documents in accordance with Section 6.11 and as promptly as practicable.
Section 7.05
Dispositions
. Make any Disposition, except:
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(a)
Dispositions of obsolete, damaged, worn out, used or surplus property (including for purposes of recycling), whether
now owned or hereafter acquired and Dispositions of property of the Borrower and the Restricted Subsidiaries that is no longer used or useful
in the conduct of the business or economically practicable or commercially desirable to maintain;
(b)
Dispositions of property in the ordinary course of business;
(c)
Dispositions of property to the extent that (i) such property is exchanged for credit against the purchase price of similar
replacement property or (ii) the proceeds of such Disposition are promptly applied to the purchase price of such replacement property;
provided that to the extent the property being transferred constitutes Collateral such replacement property shall constitute Collateral;
(d)
(e)
Dispositions of property to the Borrower or a Restricted Subsidiary;
Dispositions permitted by Section 7.02 (other than Section 7.02(o)), Section 7.04 (other than Section 7.04(h)) and
Section 7.06 (other than Section 7.06(d)) and Permitted Liens;
(f)
Dispositions of property pursuant to Sale Leaseback Transactions; provided that (i) no Event of Default exists or would
result therefrom (other than any such Disposition made pursuant to a legally binding commitment entered into at a time when no Event of
Default exists) and (ii) such Disposition shall be for no less than the fair market value of such property at the time of such Disposition;
(g)
Dispositions of Cash Equivalents; provided that such Disposition shall be for no less than the fair market value of such
property at the time of such Disposition;
(h)
leases, subleases, licenses or sublicenses (including the provision of software under an open source license), which do
not materially interfere with the business of the Borrower and the Restricted Subsidiaries, taken as a whole; provided that such Disposition
shall be for no less than the fair market value of such property at the time of such Disposition;
(i)
(j)
Dispositions of property subject to Casualty Events upon receipt of the Net Cash Proceeds of such Casualty Event;
Dispositions; provided that:
(i)
at the time of such Disposition (other than any such Disposition made pursuant to a legally binding
commitment entered into at a time when no Default exists), no Default shall exist or would result from such Disposition;
(ii)
with respect to any Disposition pursuant to this clause ((j)) for a purchase price in excess of the greater of
10.00% of Closing Date EBITDA and 10.00% of TTM Consolidated Adjusted EBITDA as of the date of the Disposition, the
Borrower or any of the Restricted Subsidiaries shall receive not less than 75.00% of such consideration in the form of cash or Cash
Equivalents; provided, however, that for the purposes of this clause ((ii)) each of the following shall be deemed to be cash;
(A)
any liabilities (as shown on the Borrower’s or such Restricted Subsidiary’s most recent balance
sheet provided hereunder or in the footnotes thereto) of the Borrower or such Restricted Subsidiary, other than
liabilities that are by their terms subordinated to the payment in cash of the Obligations, that are assumed by the
transferee with respect to
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the applicable Disposition and for which the Borrower and all of the Restricted Subsidiaries shall have been validly
released by all applicable creditors in writing;
(B)
any securities received by such Borrower or Restricted Subsidiary from such transferee that are
converted by such Borrower or Restricted Subsidiary into cash or Cash Equivalents (to the extent of the cash or Cash
Equivalents received) within one hundred and eighty days following the closing of the applicable Disposition; and
(C)
any Designated Non-Cash Consideration received in respect of such Disposition having an
aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this
clause ((C)) that is at that time outstanding, not in excess of the greater of (I) 10.00% of Closing Date EBITDA and
(II) 10.00% of TTM Consolidated Adjusted EBITDA as of the date of the Disposition, with the fair market value of
each item of Designated Non-Cash Consideration being measured at the time received and without giving effect to
subsequent changes in value; and
(iii)
such Disposition shall be for no less than the fair market value of such property at the time of such
Disposition
(this clause ((j)), the “General Asset Sale Basket”);
(k)
Dispositions of Investments in Joint Ventures to the extent required by, or made pursuant to customary buy/sell
arrangements between, the Joint Venture parties set forth in joint venture arrangements and similar binding arrangements;
(l)
Dispositions or discounts of accounts receivable and related assets in connection with the collection, compromise or
factoring thereof;
(m)
Dispositions (including issuances or sales) of Equity Interests in, or Indebtedness owing to, or of other securities of, an
Unrestricted Subsidiary (other than an Unrestricted Subsidiary the primary assets of which are cash and Cash Equivalents(;
(n)
Dispositions to the extent of any exchange of like property (excluding any boot thereon permitted by such provision)
for use in any business conducted by the Borrower or any of the Restricted Subsidiaries to the extent allowable under Section 1031 of the
Code (or comparable or successor provision);
(o)
Dispositions in connection with the unwinding of any Hedge Agreement;
(p)
Dispositions by the Borrower or any Restricted Subsidiary of assets in connection with the closing or sale of a facility
in the ordinary course of business of the Borrower and its Restricted Subsidiaries; provided that as to each and all such sales and closings,
(i) no Event of Default shall result therefrom and (ii) such sale shall be on commercially reasonable prices and terms in a bona fide arm’s-
length transaction;
(q)
Dispositions (including bulk sales) of the inventory of a Loan Party not in the ordinary course of business in connection
with facility closings, at arm’s length;
(r)
Disposition of Securitization Assets to a Securitization Subsidiary in connection with a Qualified Securitization
Financing; provided that such Disposition shall be for no less than the fair market value of such property at the time of such Disposition;
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(s)
the lapse, abandonment or discontinuance of the use or maintenance of any Intellectual Property if previously
determined by the Borrower or any Restricted Subsidiary in its reasonable business judgment that such lapse, abandonment or discontinuance
is desirable in the conduct of its business;
(t)
Disposition of any property or asset with a fair market value not to exceed $10,000,000 with respect to any transaction
or series of related transactions or $30,000,000 in the aggregate for all such transactions in any fiscal year; and
(u)
Disposition of assets acquired in a Permitted Acquisition or other Investment permitted hereunder that the Borrower
determines will not be used or useful in the business of the Borrower and its Subsidiaries.
To the extent any Collateral is Disposed of as expressly permitted by this Section 7.05 to any Person other than a Loan Party, such Collateral
shall be sold free and clear of the Liens created by the Loan Documents, and, if requested by the Administrative Agent, upon the certification
by the Borrower that such Disposition is permitted by this Agreement, and without limiting the provisions of Section 9.11 the Administrative
Agent shall be authorized to, and shall, take any actions reasonably requested by the Borrower in order to effect the foregoing (and the
Lenders hereby authorize and direct the Administrative Agent to conclusively rely on any such certification by the Borrower in performing
its obligations under this sentence).
Section 7.06
Restricted Payments
. Make, directly or indirectly, any Restricted Payment, except:
(a)
each Restricted Subsidiary may make Restricted Payments to the Borrower and to any other Restricted Subsidiaries
(and, in the case of a Restricted Payment by a non-wholly owned Restricted Subsidiary, to the Borrower or any such other Restricted
Subsidiaries and to each other owner of Equity Interests of such Restricted Subsidiary ratably according to their relative ownership interests
of the relevant class of Equity Interests or as otherwise required by the applicable Organization Documents);
(b)
the Borrower and each of the Restricted Subsidiaries may declare and make Restricted Payments payable in the form of
Equity Interests (other than Disqualified Equity Interests not otherwise permitted to be incurred under Section 7.03) of such Person;
(c)
Restricted Payments made in connection with the Transactions (including, for the avoidance of doubt, the repurchase
of any or all of the Existing Notes pursuant to the Change of Control Offer);
(d)
to the extent constituting Restricted Payments, the Borrower and the Restricted Subsidiaries may enter into and
consummate transactions expressly permitted by any provision of Section 7.02 (other than Section 7.02(o)), 7.04 (other than a merger,
amalgamation or consolidation involving the Borrower) or 7.07 (other than Section 7.07(a), ((j)) or ((k)));
(e)
Restricted Payments in respect of the repurchase of Equity Interests in Holdings (or any Parent Entity of Holdings that
only owns Equity Interests, directly or indirectly, in the Borrower and its Subsidiaries), the Borrower or any Restricted Subsidiary that occur
upon or in connection with the exercise of stock options or warrants or similar rights if such Restricted Payments represent a portion of the
exercise price of such options or warrants or similar rights or tax withholding obligations with respect thereto;
(f)
Restricted Payments of Equity Interests in, Indebtedness owing from and/or other securities of or Investments in, any
Unrestricted Subsidiaries (other than any Unrestricted Subsidiaries the assets of which consist solely of cash or Cash Equivalents received
from an Investment by the Borrower and/or any Restricted Subsidiary into it);
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(g)
the Borrower may pay (or make Restricted Payments to allow Holdings or any Parent Entity to pay) for the repurchase,
retirement or other acquisition or retirement for value of Equity Interests of Holdings (or of any Parent Entity) held by any Management
Stockholder, including pursuant to any employee or director equity plan, employee or director stock option or profits interest plan or any
other employee or director benefit plan or any agreement (including any separation, stock subscription, shareholder or partnership agreement)
with any employee, director, consultant or distributor of the Borrower (or any Parent Entity) or any of its Subsidiaries; provided, the
aggregate Restricted Payments made pursuant to this Section 7.06(g) after the Closing Date together with the aggregate amount of loans and
advances to Holdings made pursuant to Section 7.02(j) in lieu of Restricted Payments permitted by this clause ((g)) shall not exceed:
(i)
the greater of (A) 5.00% of Closing Date EBITDA and (B) 5.00% of TTM Consolidated Adjusted EBITDA
as of the applicable date of measurement in any calendar year, with unused amounts in any calendar year being carried over to the
next two succeeding calendar years; plus
(ii)
an amount not to exceed the cash proceeds of key man life insurance policies received by the Borrower or the
Restricted Subsidiaries after the Closing Date; plus
(iii)
to the extent contributed in cash to the common Equity Interests of the Borrower and Not Otherwise
Applied, the proceeds from the sale of Equity Interests of Holdings or any Parent Entity, in each case to a Person that is or
becomes a Management Stockholder that occurs after the Closing Date; plus
(iv)
the amount of any cash bonuses or other compensation otherwise payable to any future, present or former
Company Person that are foregone in return for the receipt of Equity Interests of Holdings or a Parent Entity, Borrower or any
Restricted Subsidiary; plus
(v)
payments made in respect of withholding or other similar taxes payable upon repurchase, retirement or other
acquisition or retirement of Equity Interests of Holdings or a Parent Entity or its Subsidiaries or otherwise pursuant to any
employee or director equity plan, employee or director stock option or profits interest plan or any other employee or director
benefit plan or any agreement;
(h)
the Borrower may make Restricted Payments to Holdings or to any Parent Entity:
(i)
the proceeds of which will be used to pay (or make dividends or distributions to allow any direct or indirect
Parent Entity treated as a corporation for Tax purposes to pay) the Tax liability (including estimated Tax payments) to each
foreign, federal, state, or local jurisdiction in respect of which a tax return is filed by Holdings (or such direct or indirect Parent
Entity) that includes the Borrower and/or any of its Subsidiaries (including in the case where the Borrower and any Subsidiary is a
disregarded entity for income Tax purposes), to the extent such Tax liability does not exceed the lesser of (A) the Taxes (including
estimated Tax payments) that would have been payable by the Borrower and/or its Subsidiaries as a stand-alone Tax group
(assuming, if applicable, that the Borrower was classified as a corporation for income Tax purposes) and (B) the actual Tax
liability (including estimated Tax payments) of Holdings’ Tax group (or, if Holdings is not the parent of the actual group, the
Taxes that would have been paid by Holdings (assuming, if applicable, that Holdings was classified as a corporation for income
Tax purposes), the Borrower and/or the Borrower’s Subsidiaries as a stand-alone Tax group), reduced in the case of clauses (A)
and (B) by any such Taxes paid or to be paid directly by the Borrower or its Subsidiaries; provided that in the case of any such
distributions attributable to Tax liability in respect of income of an
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Unrestricted Subsidiary, the Borrower shall use all commercially reasonable efforts to cause such Unrestricted Subsidiary (or
another Unrestricted Subsidiary) to make cash distributions to the Borrower or its Restricted Subsidiaries in an aggregate amount
that the Borrower determines in its reasonable discretion is necessary to pay such Tax liability in respect of such Unrestricted
Subsidiary;
(ii)
the proceeds of which will be used to pay (or make Restricted Payments to allow any Parent Entity to pay)
operating costs and expenses (including Public Company Costs) of Holdings or any Parent Entity incurred in the ordinary course
of business and other corporate overhead costs and expenses (including administrative, legal, accounting and similar expenses
provided by third parties), which are reasonable and customary and incurred in the ordinary course of business, attributable to the
ownership or operations of the Borrower and its Subsidiaries;
(iii)
the proceeds of which will be used to pay franchise taxes and other fees, taxes and expenses required to
maintain its (or any of such Parent Entity’s) corporate or legal existence;
(iv)
to finance any Investment permitted to be made pursuant to Section 7.02; provided that (A) such Restricted
Payment shall be made substantially concurrently with the closing of such Investment and (B) Holdings and the Borrower shall,
immediately following the closing thereof, cause (1) all property acquired (whether assets or Equity Interests) to be contributed to
the Borrower or a Restricted Subsidiary (which shall be a Restricted Subsidiary to the extent required by Section 7.02) or (2) the
merger or amalgamation (to the extent permitted in Section 7.04) of the Person formed or acquired by the Borrower or a Restricted
Subsidiary in order to consummate such Investment;
(v)
the proceeds of which shall be used to pay (or make Restricted Payments to allow any Parent Entity to pay)
costs, fees and expenses (other than to Affiliates) related to any successful or unsuccessful equity or debt offering permitted by
this Agreement; and
(vi)
the proceeds of which (A) will be used to pay customary salary, bonus and other benefits payable to officers
and employees of Holdings or any Parent Entity to the extent such salaries, bonuses and other benefits are attributable to the
ownership or operation of the Borrower and the Restricted Subsidiaries or (B) will be used to make payments permitted under
Sections 7.07(e), ((h)), ((k)) and ((q)) (but only to the extent such payments have not been and are not expected to be made by the
Borrower or a Restricted Subsidiary);
(i)
Restricted Payments (i) made in connection with the payment cash in lieu of fractional Equity Interests in connection
with any dividend, split or combination thereof or any Permitted Acquisition or other transaction permitted by the Loan Documents or (ii) to
honor any conversion request by a holder of convertible Indebtedness and to make cash payments in lieu of fractional shares in connection
therewith;
(j)
following a Qualifying IPO, the declaration and payment of dividends on the Borrower’s, Holdings’ or a Parent Entity’s
common stock, not to exceed an amount per annum equal to 6% of the net proceeds received by or contributed to Borrower in or from a
Qualifying IPO (or in the case of a SPAC IPO, cash held by the Borrower (or held by Holdings or any other Parent Entity to the extent
contributed to the Borrower) following the consummation of such SPAC IPO);
(k)
repurchases of Equity Interests (i) deemed to occur on the exercise of options by the delivery of Equity Interests in
satisfaction of the exercise price of such options or (ii) in consideration of withholding or similar Taxes payable by any future, present or
former employee, director, manager or consultant (or any spouses, former spouses, successors, executors, administrators, heirs, legatees or
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distributees of any of the foregoing), including deemed repurchases in connection with the exercise of stock options or the vesting of any
equity awards;
(l)
payments or distributions to satisfy dissenters rights (including in connection with or as a result of the exercise of
appraisal rights and the settlement of any claims or actions, whether actual, contingent or potential) pursuant to or in connection with a
merger, amalgamation, consolidation, transfer of assets or other transaction permitted by the Loan Documents;
(m)
payments or distributions of a Restricted Payment within 60 days after the date of declaration thereof if at the date of
declaration such Restricted Payment would have been permitted hereunder;
(n)
Restricted Payments (not consisting of cash or Cash Equivalents) made in lieu of fees or expenses (including by way of
discount), in each case in connection with any Qualified Securitization Financing;
(o)
the Borrower may (or may make Restricted Payments to permit any Parent Entity to) (i) redeem, repurchase, retire or
otherwise acquire in whole or in part any Equity Interests of the Borrower or any Restricted Subsidiary or any Equity Interests of any Parent
Entity (“Treasury Equity Interests”), in exchange for, or with the proceeds (to the extent contributed to Holdings or the Borrower
substantially concurrently) of the sale or issuance (other than to the Borrower or any Restricted Subsidiary) of, other Equity Interests or rights
to acquire its Equity Interests (“Refunding Equity Interests”) and (ii) declare and pay dividends on any Treasury Equity Interests out of any
such proceeds;
(p)
redemptions in whole or in part of any of its Equity Interests for another class of its Equity Interests (other than
Disqualified Equity Interests, except to the extent issued by the Borrower to a Restricted Subsidiary) or with proceeds from substantially
concurrent equity contributions or issuances of new Equity Interests (and in no event shall such contribution or issuance so utilized increase
the Available Amount) (other than Disqualified Equity Interests, except to the extent issued by the Borrower to a Restricted Subsidiary);
(q)
Restricted Payments constituting or otherwise made in connection with or relating to any Permitted Reorganization;
provided that if immediately after giving Pro Forma Effect to any such Permitted Reorganization and the transactions to be consummated in
connection therewith, any distributed asset ceases to be owned by the Borrower or another Restricted Subsidiary (or any entity ceases to be a
Restricted Subsidiary), the applicable portion of such Restricted Payment must be otherwise permitted under another provision of this
Section 7.06 (and constitute utilization of such other Restricted Payment exception or capacity);
(r)
Restricted Payments; provided that the Total Net Leverage Ratio (after giving Pro Forma Effect to such Restricted
Payment) for the Test Period immediately preceding the making of such Restricted Payment shall be less than or equal to the Closing Date
Total Net Leverage Ratio less 2.00 to 1.00; provided that no Specified Event of Default has occurred or is continuing or would result
therefrom;
(s)
the Borrower may make Restricted Payments (the proceeds of which may be utilized by Holdings to make additional
Restricted Payments) in an aggregate amount not to exceed the sum of,
(i)
the Available Amount that is Not Otherwise Applied as in effect immediately prior to the time of such
Restricted Payment; provided, (1) that no Event of Default shall have occurred and be continuing or would result therefrom and
(2) other than with respect to amounts under clause (c) of the definition of Available Amount, the Total Net Leverage Ratio (after
giving Pro Forma
154
Effect to the incurrence of such Restricted Payment) for the most recently ended Test Period shall be less than or equal to the
Closing Date Total Net Leverage Ratio; and
(ii)
together with any Junior Debt Repayments under Section 7.09(a)(x)(B), the greater of (A) 25.00% of Closing
Date EBITDA and (B) 25.00% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination;
The amount set forth in Section 7.06(s)(ii) may, in lieu of Restricted Payments, be utilized by the Borrower or any Restricted
Subsidiary to make any Investments without regard to Section 7.02.
Nothwithstanding anything to the contrary contained herein, no Restricted Payments shall be made in reliance of Sections 7.06(r)
and (s) until after the second anniversary of the Closing Date.
The amount of any Restricted Payment at any time shall be the amount of cash and the fair market value of other property subject
to the Restricted Payment at the time such Restricted Payment is made. For purposes of determining compliance with this Section 7.06, in
the event that any Restricted Payment (or any portion thereof) meets the criteria of more than one of the categories set forth above, the
Borrower may, in its sole discretion, at the time of such Restricted Payment is made, divide, classify or reclassify, or at any later time divide,
classify, or reclassify, such Restricted Payment (or any portion thereof) in any manner that complies with this covenant on the date such
Restricted Payment is made or such later time, as applicable.
Section 7.07
Transactions with Affiliates
. Enter into any transaction of any kind with any Affiliate of the Borrower, other than:
(a)
transactions between or among the Borrower or any of the Restricted Subsidiaries or any entity that becomes a
Restricted Subsidiary as a result of such transaction;
(b)
transactions on terms substantially as favorable to the Borrower or such Restricted Subsidiary as would be obtainable
by the Borrower or such Restricted Subsidiary at the time in a comparable arm’s-length transaction with a Person other than an Affiliate (as
determined by the Borrower in good faith); provided that (x) any transaction pursuant to this Section 7.07(b) in excess of $25,000,000 shall
be approved by a majority of the disinterested members of the Board of Directors of Holdings or the Borrower in good faith and (y) for any
transaction pursuant to this Section 7.07(b) in excess of $50,000,000, the Borrower shall deliver to the Administrative Agent a letter from an
Independent Financial Advisor stating that such transaction is fair to the Borrower or such Restricted Subsidiary from a financial point of
view or is on terms substantially as favorable to the Borrower or such Restricted Subsidiary as would be obtainable by the Borrower or such
Restricted Subsidiary at the time in a comparable arm’s-length transaction with a Person other than an Affiliate;
(c)
the Transactions and the payment of fees and expenses (including the Transaction Expenses) related to the Transactions
on or about the Closing Date to the extent such fees and expenses are disclosed to the Administrative Agent prior to the Closing Date;
(d)
the issuance or transfer of Equity Interests of Holdings or any Parent Entity to any Affiliate of the Borrower or any
former, current or future officer, director, manager, employee or consultant (or any spouses, former spouses, successors, executors,
administrators, heirs, legatees or distributees of any of the foregoing) of the Borrower or any of its Subsidiaries or any Parent Entity;
(e)
[reserved];
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(f)
employment and severance arrangements and confidentiality agreements among Holdings, the Borrower and the
Restricted Subsidiaries and their respective officers and employees in the ordinary course of business and transactions pursuant to stock
option, profits interest and other equity plans and employee benefit plans and arrangements;
(g)
the licensing of trademarks, copyrights or other Intellectual Property in the ordinary course of business to permit the
commercial exploitation of intellectual property between or among Affiliates and Subsidiaries of the Borrower;
(h)
the payment of customary fees and reasonable out-of-pocket costs to, and indemnities provided on behalf of, directors,
officers, employees and consultants of Holdings, the Borrower and the Restricted Subsidiaries or any Parent Entity in the ordinary course of
business to the extent attributable to the ownership or operation of the Borrower and the Restricted Subsidiaries;
(i)
any agreement, instrument or arrangement as in effect as of the Closing Date or any amendment thereto (so long as any
such amendment is not adverse to the Lenders in any material respect as compared to the applicable agreement as in effect on the Closing
Date);
(j)
(k)
Restricted Payments permitted under Section 7.06 and Investments permitted under Section 7.02;
[reserved];
(l)
transactions in which the Borrower or any of the Restricted Subsidiaries, as the case may be, delivers to the
Administrative Agent a letter from an Independent Financial Advisor stating that such transaction is fair to the Borrower or such Restricted
Subsidiary from a financial point of view or meets the requirements of clause ((b)) of this Section 7.07 (without giving effect to the
parenthetical phrase at the end thereof);
(m)
[reserved];
(n)
investments by Jackson Wijaya in securities of Holdings or Indebtedness of Holdings, Borrower or any of the
Restricted Subsidiaries so long as (A) the investment is being offered generally to other investors on the same or more favorable terms and
(B) the investment constitutes less than 5.0% of the proposed or outstanding issue amount of such class of securities;
(o)
(p)
payments to or from, and transactions with, Joint Ventures in the ordinary course of business;
any Disposition of Securitization Assets or related assets in connection with any Qualified Securitization Financing;
(q)
the payment of reasonable out-of-pocket costs and expenses relating to registration rights and indemnities provided to
shareholders of Holdings or any Parent Entity pursuant to the stockholders agreement or the registration and participation rights agreement
entered into on the Closing Date in connection therewith;
(r)
the payment of any dividend or distribution within sixty days after the date of declaration thereof, if at the date of
declaration (i) such payment would have complied with the provisions of this Agreement and (ii) no Event of Default occurred and was
continuing;
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(s)
transactions between the Borrower or any of the Subsidiaries and any person, a director of which is also a director of
the Borrower or any direct or indirect Parent Entity of the Borrower; provided however, that (i) such director abstains from voting as a
director of the Borrower or such direct or indirect Parent Entity, as the case may be, on any matter involving such other person and (ii) such
Person is not an Affiliate of Holdings for any reason other than such director’s acting in such capacity;
(t)
payments, loans (or cancellation of loans) or advances to employees or consultants that are (i) approved by a majority of
the disinterested members of the Board of Directors of Holdings or the Borrower in good faith, (ii) made in compliance with applicable law
and (iii) otherwise permitted under this Agreement; and
(u)
transactions (i) with Holdings in its capacity as a party to any Loan Document or to any agreement, document or
instrument governing or relating to (A) any Indebtedness permitted to be incurred pursuant to Section 7.03 (including Permitted Refinancings
thereof) or (B) the Acquisition Agreement, any other agreements contemplated thereby or any agreement, document or instrument governing
or relating to any Permitted Acquisition (whether or not consummated) and (ii) with any Affiliate or branch in its capacity as a Lender party
to any Loan Document or party to any agreement, document or instrument governing or relating to any Indebtedness permitted to be incurred
pursuant to Section 7.03 (including Permitted Refinancings thereof) to the extent such Affiliate or branch is being treated no more favorably
than all other Lenders or lenders thereunder.
Section 7.08
Negative Pledge
. Enter into or permit to exist any Contractual Obligation (other than this Agreement or any other Loan Document) that prohibits
or restricts the ability of any Restricted Subsidiary (other than an Excluded Subsidiary) (i) that is not a Loan Party, to make dividends or
distributions to (directly or indirectly), or to make or repay loans or advances to, any Loan Party or (ii) to create, incur, assume or suffer to
exist Liens on property of such Person (other than Excluded Assets) for the benefit of the Lenders to secure the Obligations under the Loan
Documents (other than Incremental Facilities that are not intended to be secured on a first lien basis);
provided that the foregoing shall not apply to Contractual Obligations that:
(a)
exist on the Closing Date, including Contractual Obligations governing Indebtedness incurred on the Closing Date to
finance the Transactions and any Permitted Refinancing thereof or other Contractual Obligations executed on the Closing Date in connection
with the Transactions;
(b)
are binding on a Restricted Subsidiary at the time such Restricted Subsidiary first becomes a Restricted Subsidiary, so
long as such Contractual Obligations were not entered into in contemplation of such Person becoming a Restricted Subsidiary or binding with
respect to any asset at the time such asset was acquired;
(c)
are Contractual Obligations of a Restricted Subsidiary that is not a Loan Party or to the extent applicable only to
Excluded Assets;
(d)
are customary restrictions that arise in connection with (A) any Lien permitted by Section 7.01 and relate to the
property subject to such Lien or (B) any Disposition permitted by Section 7.05 applicable pending such Disposition solely to the assets
(including Equity Interests) subject to such Disposition;
(e)
Joint Venture;
are joint venture agreements and other similar agreements applicable to Joint Ventures and applicable solely to such
157
(f)
are negative pledges and restrictions on Liens in favor of any holder of Indebtedness permitted under Section 7.03 but
solely to the extent any negative pledge relates to the property financed by or the subject of or that secures such Indebtedness and the
proceeds and products thereof;
(g)
are restrictions in leases, subleases, licenses, sublicenses or agreements governing a disposition of assets, trading,
netting, operating, construction, service, supply, purchase, sale or other agreements entered into in the ordinary course of business so long as
such restrictions relate to the assets subject thereto;
(h)
comprise restrictions imposed by any agreement relating to secured Indebtedness permitted pursuant to Section 7.03 to
the extent that such restrictions apply only to the property or assets securing such Indebtedness and the proceeds and products thereof;
(i)
(j)
(k)
are customary provisions restricting subletting or assignment of any lease governing a leasehold interest;
are customary provisions restricting assignment of any agreement entered into in the ordinary course of business;
are restrictions on cash or other deposits imposed by customers or trade counterparties under contracts entered into in
the ordinary course of business;
(l)
arise in connection with cash or other deposits permitted under Section 7.01;
(m)
comprise restrictions that are, taken as a whole, in the good faith judgment of the Borrower (i) no more restrictive with
respect to the Borrower or any Restricted Subsidiary than customary market terms for Indebtedness of such type, (ii) no more restrictive than
the restrictions contained in this Agreement, or (iii) not reasonably anticipated to materially and adversely affect the Loan Parties’ ability to
make any payments required hereunder;
(n)
apply by reason of any applicable Law, rule, regulation or order or are required by any Governmental Authority having
jurisdiction over the Borrower or any Restricted Subsidiary;
(o)
customary restrictions contained in Indebtedness permitted to be incurred pursuant to Section 7.03(b), ((h)), ((i)), ((j)),
((k)), ((l)), ((m)), ((x)) or ((y));
(p)
(q)
Contractual Obligations that are subject to the applicable override provisions of the UCC or the PPSA;
customary provisions (including provisions limiting the Disposition, distribution or encumbrance of assets or property)
included in sale leaseback agreements or other similar agreements;
(r)
net worth provisions contained in agreements entered into by the Borrower or any Restricted Subsidiary, so long as the
Borrower has determined in good faith that such net worth provisions would not reasonably be expected to impair the ability of the Borrower
or such Restricted Subsidiary to meet its ongoing obligations;
(s)
restrictions arising in any agreement relating to (i) any Cash Management Obligation to the extent such restrictions
relate solely to the cash, bank accounts or other assets or activities subject to the applicable Cash Management Services, (ii) any treasury
arrangements and (iii) any Hedge Agreement;
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(t)
restrictions on the granting of a security interest in Intellectual Property contained in licenses, sublicenses or cross-
licenses by the Borrower or any Restricted Subsidiary of such Intellectual Property, which licenses, sublicenses and cross-licenses were
entered into in the ordinary course of business;
(u)
other restrictions or encumbrances imposed by any amendment, modification, restatement, renewal, increase,
supplement, refunding, replacement or refinancing of the contracts, instruments or obligations referred to in the preceding clauses of this
Section 7.08; provided that no such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or
refinancing is, in the good faith determination of the Borrower, materially more restrictive with respect to such encumbrances and other
restrictions, taken as a whole, than those in effect prior to the relevant amendment, modification, restatement, renewal, increase, supplement,
refunding, replacement or refinancing; and
(v)
any agreement or other instrument of a Person acquired by the Borrower or any Restricted Subsidiary which was in
existence at the time of such acquisition (but not created in contemplation thereof or to provide all or any portion of the funds or credit
support utilized to consummate such acquisition other than in connection with the incurrence of Indebtedness of the type contemplated by
Section 7.03(d)), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the
Person and its Subsidiaries, or the property or assets of the Person and its Subsidiaries, so acquired.
Section 7.09
Junior Debt Prepayments; Amendments to Junior Financing Documents
.
(a)
Prepayments of Junior Financing. Prepay, repay, redeem, purchase, defease or otherwise satisfy prior to the date that is
one year before the scheduled maturity thereof any Junior Financing (any such prepayment, repayment, redemption, purchase, defeasance or
satisfaction, a “Junior Debt Repayment”), except:
(i)
Junior Debt Repayments with the proceeds of, or in exchange for, any (A) Permitted Refinancing or (B) other
Junior Financing or Junior Lien Debt;
(ii)
Junior Debt Repayments (A) made with Qualified Equity Interests of Holdings or any Parent Entity, with the
proceeds of an issuance of any such Equity Interests or with the proceeds of a contribution to the capital of the Borrower after the
Closing Date that is Not Otherwise Applied or (B) consisting of the conversion of any Junior Financing to Equity Interests;
(iii)
Junior Debt Repayments of Indebtedness of the Borrower or any Restricted Subsidiary owed to Holdings,
the Borrower or a Restricted Subsidiary;
(iv)
Junior Debt Repayments of Indebtedness of any Person that becomes a Restricted Subsidiary after the
Closing Date in connection with a transaction not prohibited by the Loan Documents;
(v)
Junior Debt Repayments within 60 days of giving notice thereof if at the date of such notice, such payment
would have been permitted hereunder;
(vi)
Junior Debt Repayments made in connection with the Transactions;
(vii)
Junior Debt Repayments consisting of the payment of regularly scheduled interest and principal payments,
payments of fees, expenses, penalty interest and indemnification obligations when due, other than payments prohibited by any
applicable subordination provisions;
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(viii)
Junior Debt Repayments consisting of a payment to avoid the application of Section 163(e)(5) of the Code
(an “AHYDO Catch Up Payment”);
(ix)
Junior Debt Repayments; provided that the Total Net Leverage Ratio (after giving Pro Forma Effect to such
Junior Debt Repayment) for the Test Period immediately preceding the making of such Junior Debt Repayment shall be less than
or equal to the Closing Date Total Net Leverage Ratio less 1.75 to 1.00; provided that no Event of Default has occurred or is
continuing or would result therefrom; and
(x)
Junior Debt Repayments in an aggregate amount not to exceed the sum of:
(A)
the Available Amount at such time; provided that (1) that no Event of Default shall have occurred
and be continuing or would result therefrom and (2) other than with respect to amounts under clause (c) of the
definition of Available Amount, the Total Net Leverage Ratio (after giving Pro Forma Effect to the incurrence of such
Restricted Payment) for the most recently ended Test Period shall be less than or equal to the Closing Date Total Net
Leverage Ratio; and
(B)
together with any Restricted Payments under Section 7.06(s)(ii), the greater of (A) 25.00% of
Closing Date EBITDA and (B) 25.00% of TTM Consolidated Adjusted EBITDA of the Borrower on a Pro Forma Basis
as of the applicable date of determination.
provided, however, that each of the following shall be permitted: payments of regularly scheduled principal and interest on Junior Financing,
payments of closing and consent fees related to Junior Financing, indemnity and expense reimbursement payments in connection with Junior
Financing, and mandatory prepayments, mandatory redemptions and mandatory purchases, in each case pursuant to the terms of Junior
Financing Documentation.
For the avoidance of doubt, the redemption or repurchase of any or all of the Existing Notes pursuant to the Change of Control
Offer or otherwise shall not constitute a Junior Debt Repayment.
The amount set forth in Section 7.09(a)(x)(B) may, in lieu of Junior Debt Repayments be utilized by the Borrower or any
Restricted Subsidiary to make any Investments without regard to Section 7.02.
The amount of any Junior Debt Repayment at any time shall be the amount of cash and the fair market value of other property
used to make the Junior Debt Repayment at the time such Junior Debt Repayment is made. For purposes of determining compliance with
this Section 7.09(a), in the event that any prepayment, repayment, redemption, purchase, defeasance or satisfaction (or any portion thereof)
meets the criteria of more than one of the categories set forth above, the Borrower may, in its sole discretion, at the time of such prepayment,
repayment, redemption, purchase, defeasance or satisfaction is made, divide, classify, or reclassify, or at any later time divide, classify or
reclassify, such prepayment, repayment, redemption, purchase, defeasance or satisfaction (or any portion thereof) in any manner that
complies with this covenant on the date it was made or such later time, as applicable.
(b)
Amendments to Junior Financing Documents. Amend, modify or change in any manner without the consent of the
Administrative Agent, any Junior Financing Documentation unless (i) such amendment, modification or change is permitted pursuant to any
applicable intercreditor or subordination agreement or (ii) the Borrower determines in good faith that the effect of such amendment,
modification or waiver is not, taken as a whole, materially adverse to the interests of the Lenders, in each case, other than as a result of a
Permitted Refinancing thereof; provided that, in each case, a certificate of the Borrower
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delivered to the Administrative Agent at least five Business Days prior to such amendment or other modification, together with a reasonably
detailed description of such amendment or modification, stating that the Borrower has reasonably determined in good faith that such terms
and conditions satisfy such foregoing requirement shall be conclusive evidence that such terms and conditions satisfy such foregoing
requirement unless the Administrative Agent notifies the Borrower within such five Business Day period that it disagrees with such
determination (including a reasonably detailed description of the basis upon which it disagrees).
Section 7.10
Passive Holding Company
.
(a)
In the case of Holdings, engage in any active trade or business, it being agreed that the following activities (and
activities incidental thereto) will not be prohibited:
(i)
its ownership of the Equity Interests of the Borrower;
(ii)
maintenance);
the maintenance of its legal existence (including the ability to incur fees, costs and expenses relating to such
(iii)
the performance of its obligations and payments with respect to (i) any Indebtedness permitted to be
incurred pursuant to Section 7.03, any Qualified Holding Company Debt or any Permitted Refinancing of any of the foregoing or
(ii) the Acquisition Agreement and the other agreements contemplated by the Acquisition Agreement;
(iv)
any public offering of its common stock or any other issuance of its Equity Interests (including Qualified
Equity Interests);
(v)
making (i) payments or Restricted Payments to the extent otherwise permitted under this Section 7.10 and
(ii) Restricted Payments with any amounts received pursuant to transactions permitted under, and for the purposes contemplated
by, Section 7.06;
(vi)
(vii)
the incurrence of Qualified Holding Company Debt;
making contributions to the capital of its Subsidiaries;
(viii)
guaranteeing the obligations of the Borrower and its Subsidiaries in each case solely to the extent such
obligations of the Borrower and its Subsidiaries are not prohibited hereunder;
(ix)
participating in tax, accounting and other administrative matters as a member of a consolidated, combined or
unitary group that includes Holdings and the Borrower;
(x)
holding any cash or property received in connection with Restricted Payments made by the Borrower in
accordance with Section 7.06 pending application thereof by Holdings;
(xi)
(xii)
providing indemnification to officers and directors;
making Investments in assets that are Cash Equivalents; and
(xiii)
activities incidental to the businesses or activities described in clauses (i) to (xii) of this Section 7.10(a).
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(b)
Holdings may not merge, amalgamate, dissolve, liquidate or consolidate with or into any other Person; provided that,
notwithstanding the foregoing, as long as no Default exists or would result therefrom, Holdings may merge, amalgamate or consolidate with
any other Person if the following conditions are satisfied:
(i)
(ii)
Holdings shall be the continuing or surviving Person, or
if the Person formed by or surviving or continuing following any such merger, amalgamation or
consolidation is not Holdings or is a Person into which Holdings has been liquidated,
(A)
the Successor Holdings shall be an entity organized or existing under the laws of the United States,
any state thereof or the District of Columbia,
(B)
the Successor Holdings shall expressly assume all the obligations of Holdings under this
Agreement and the other Loan Documents to which Holdings is a party pursuant to a supplement hereto or thereto in
form reasonably satisfactory to the Administrative Agent,
(C)
the Successor Holdings shall pledge 100% of the Equity Interest of the Borrower to the Collateral
Agent as Collateral to secure the Obligations in form reasonably satisfactory to the Administrative Agent, and
(D)
the Borrower shall have delivered to the Administrative Agent an officer’s certificate and an
opinion of counsel, each stating that such merger, amalgamation or consolidation and such supplement to this
Agreement or any Collateral Document comply with this Agreement and, with respect to such opinion of counsel only,
including customary organization, due execution, no conflicts and enforceability opinions to the extent reasonably
requested by the Administrative Agent;
it being agreed that if the foregoing are satisfied, the Successor Holdings will succeed to, and be substituted for, Holdings under this
Agreement.
Notwithstanding anything herein to the contrary, in the event of any merger, dissolution, liquidation, consolidation, amalgamation
or Division of Holdings effected in accordance with this Section 7.10, the Borrower shall or shall cause, with respect to the surviving or
continuing Person (or new direct Parent Entity) (x) promptly deliver or cause to be delivered to the Administrative Agent for further
distribution by the Administrative Agent to each Lender (1) such information and documentation reasonably requested by the Administrative
Agent or any Lender in order to comply with applicable “know your customer” and anti-money laundering rules and regulations, including
the USA PATRIOT Act and (2) a Beneficial Ownership Certification and (y) do, execute, acknowledge, deliver, record, re-record, file, re-file,
register and re-register any and all such further acts, deeds, certificates, assurances and other instruments as the Administrative Agent or
Collateral Agent may reasonably request in order to perfect or continue the perfection of the Liens granted or purported to be granted by the
Collateral Documents as promptly as practicable.
Section 7.11
Changes in Fiscal Year
. Make any change in the fiscal year of the Borrower; provided, however, that the Borrower may, upon written notice to the
Administrative Agent, change its fiscal year to any other fiscal year reasonably acceptable to the Administrative Agent, in which case, the
Borrower and the Administrative Agent will, and are hereby authorized by the Lenders to, make any adjustments to this Agreement that are
necessary to reflect such change in fiscal year.
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ARTICLE VIII.
EVENTS OF DEFAULT AND REMEDIES
Section 8.01
Events of Default
. Each of the events referred to in clauses ((a)) through (j) of this Section 8.01 constitutes an “Event of Default”:
(a)
Non-Payment. Any Loan Party fails to pay (i) when and as required to be paid pursuant to the terms of this Agreement,
any amount of principal of any Loan, or (ii) within five (5) Business Days after the same becomes due, any interest on any Loan or any fee
payable pursuant to the terms of a Loan Document;
(b)
Specific Covenants. The Borrower or any Subsidiary Guarantor or, in the case of Section 7.10, Holdings, fails to
perform or observe any covenant contained in Section 6.03(a), Section 6.05(a) (solely with respect to the Borrower) or Article VII; or
(c)
Other Defaults. The Borrower or any Subsidiary Guarantor fails to perform or observe any other covenant (not
specified in Section 8.01(a) or Section ((b)) contained in any Loan Document on its part to be performed or observed and such failure
continues for thirty days after receipt by the Borrower of written notice thereof from the Administrative Agent; or
(d)
Representations and Warranties. Any representation or warranty made or deemed by any Loan Party in any Loan
Document, or in any document required to be delivered pursuant to the terms of a Loan Document shall be untrue in any material respect (or,
with respect to any representation or warranty qualified by materiality or “Material Adverse Effect,” shall be untrue in any respect) when
made or deemed made; provided that (i) this clause (d) shall be limited on the Closing Date to Specified Representations, Company Specified
Representations and the Acquisition Agreement Representations and (ii) any failure of an Acquisition Agreement Representation to be
accurate shall not result in a Default or Event of Default under this clause (d) or any other provision of a Loan Document unless such failure
results in a failure of the condition set forth in Section 4.01; provided, further, that in the case of any representation and warranty made or
deemed made after the Closing Date that is capable of being cured, such representation or warranty shall remain untrue (in any material
respect or in any respect, as applicable) or uncorrected for a period of thirty days after written notice thereof from the Administrative Agent
to the Borrower; or
(e)
Cross-Default. The Borrower or any Restricted Subsidiary:
(i)
fails to make any payment of any principal or interest beyond the applicable grace period, if any, whether by
scheduled maturity, required prepayment, acceleration, demand or otherwise, in respect of its Material Indebtedness; or
(ii)
fails to perform or observe any covenant contained in an agreement governing its Material Indebtedness, or
any other event occurs, the effect of which failure or other event is to cause such Material Indebtedness to become due prior to its
stated maturity, in each case pursuant to its terms;
provided that (A) this Section 8.01(e) shall not apply to any failure if it has been remedied, cured or waived, or is capable of being cured, in
accordance with the terms of such Material Indebtedness and (B) Section 8.01(e)(ii) shall not apply (1) to any secured Indebtedness that
becomes due as a result of the sale, transfer or other disposition (including as a result of a casualty or condemnation event) of the property or
assets securing such Indebtedness; (2) to the failure to observe or perform any covenant that requires compliance with any measurement of
financial or operational performance (including any leverage, interest
163
coverage or fixed charge ratio or minimum EBITDA, a “Financial Covenant”) unless and until the holders of such Indebtedness have
terminated all commitments (if any) and accelerated all obligations with respect thereto; (3) to the conversion of, or the satisfaction of any
condition to the conversion of, any Indebtedness that is convertible or exchangeable for Equity Interests; (4) to a customary “change of
control” put right in any indenture governing any such Indebtedness in the form of notes; or (5) to a refinancing of Indebtedness permitted by
this Agreement; or
(f)
Insolvency Proceedings, Etc. (i) The Borrower, Holdings or any Material Subsidiary (or group of Restricted
Subsidiaries that taken together would constitute a Material Subsidiary) (A) institutes or consents to the institution of any proceeding under
any Debtor Relief Law, (B) makes an assignment for the benefit of creditors or (C) applies for or consents to the appointment of any receiver,
interim receiver, receiver and manager, monitor, trustee, custodian, conservator, liquidator, rehabilitator, administrator, administrative
receiver or similar officer for it or for all or any material part of its property; (ii) any receiver, interim receiver, receiver and manager,
monitor, trustee, custodian, conservator, liquidator, rehabilitator, administrator, administrative receiver or similar officer is appointed for the
Borrower, Holdings or a Material Subsidiary (or group of Restricted Subsidiaries that taken together would constitute a Material Subsidiary)
without the application or consent of such Material Subsidiary (or group of Restricted Subsidiaries that taken together would constitute a
Material Subsidiary) and the appointment continues undischarged or unstayed for sixty (60) days; (iii) any proceeding under any Debtor
Relief Law relating to the Borrower, Holdings or a Material Subsidiary (or group of Restricted Subsidiaries that taken together would
constitute a Material Subsidiary) is instituted without the consent of the Borrower, Holdings or such Material Subsidiary (or group of
Restricted Subsidiaries that taken together would constitute a Material Subsidiary) and continues undismissed or unstayed for sixty (60) days
or (iv) an order for relief is entered in any such proceeding; or
(g)
Judgments. There is entered against the Borrower, Holdings or a Material Subsidiary (or group of Restricted
Subsidiaries that taken together would constitute a Material Subsidiary) a final, enforceable and non-appealable judgment by a court of
competent jurisdiction for the Borrower, Holdings or any Restricted Subsidiary the payment of money in an aggregate amount exceeding the
Threshold Amount (to the extent not covered by independent third-party insurance or another indemnity obligation) and such judgment or
order is not satisfied, vacated, discharged or stayed or bonded for a period of sixty (60) consecutive days; or
(h)
Invalidity of Loan Documents. The material provisions of the Loan Documents, taken as a whole, at any time after
their execution and delivery and for any reason cease to be in full force and effect, except (i) as permitted by, or as a result of a transaction
permitted by, the Loan Documents (including as a result of a transaction permitted under Section 7.04 or Section 7.05), (ii) as a result of the
Termination Conditions or (iii) resulting from acts or omissions of a Secured Party or the application of applicable law; or
(i)
Collateral Documents and Guarantee. Any:
(i)
Collateral Document with respect to a material portion of the Collateral with a fair market value exceeding
the Threshold Amount after its execution and delivery shall for any reason cease to create a valid and perfected Lien, except (A) as
otherwise permitted by the Loan Documents, (B) resulting from the failure of the Administrative Agent or the Collateral Agent or
any of their agents or bailees to maintain possession or control of Collateral, (C) resulting from the failure to make a filing of a
continuation statement, under the Uniform Commercial Code, (D) as to Collateral consisting of real property to the extent that
such losses are covered by a lender’s title insurance policy and such insurer has not denied coverage, or (E) resulting from acts or
omissions of a Secured Party; or
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(ii)
Guarantee with respect to a Guarantor that is Holdings or a Material Subsidiary (other than an Excluded
Subsidiary) shall for any reason cease to be in full force and effect, except (A) as otherwise permitted by the Loan Documents, (B)
upon the Termination Conditions, (C) upon the release of such Guarantor as provided for under the Loan Document or in
accordance with its terms or (D) resulting from acts or omissions of a Secured Party or the application of applicable law; or
(j)
Change of Control. There occurs any Change of Control.
Section 8.02
Remedies upon Event of Default
.
(a)
General. If (and only if) any Event of Default occurs and is continuing, the Administrative Agent may, and shall at the
request of the Required Lenders, take any or all of the following actions upon notice to the Borrower:
(i)
declare the Commitments (including, for the avoidance of doubt, Delayed Draw Commitments) of each
Lender to be terminated, whereupon such Commitments and obligation shall be terminated; and
(ii)
declare the unpaid principal amount of all outstanding Loans, all interest and premium accrued and unpaid
thereon, and all other amounts 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 Borrower and
each Guarantor;
provided that upon the occurrence of an actual or deemed entry of an order for relief with respect to the Borrower under any Debtor Relief
Law, the Commitments of each Lender shall automatically terminate, the unpaid principal amount of all outstanding Loans and all interest
and other amounts as aforesaid shall automatically become due and payable, in each case without further act of the Administrative Agent or
any Lender.
(b)
Limitations on Remedies; Cures.
(i)
Net Short Representations. Any notice of Default, Event of Default or acceleration provided to the Borrower
by the Administrative Agent on behalf of one or more Lenders that have expressly requested that such notice be given to the
Borrower must be accompanied by a written Net Short Representation from any such Lender (other than an Unrestricted Lender)
delivered to the Borrower (with a copy to the Administrative Agent); provided that (A) in the absence of any such written Net
Short Representation, each such Lender shall be deemed to have represented and warranted to the Borrower and the
Administrative Agent that it is not a Net Short Lender (it being understood and agreed that the Borrower and the Administrative
Agent shall be entitled to rely conclusively on each such representation and deemed representation and (B) no Net Short
Representation shall be required to be delivered during the pendency of a Default or Event of Default caused by a bankruptcy or
similar insolvency proceeding.
(ii)
[Reserved]; and
(iii)
Cures. Any Default or Event of Default resulting from or arising in connection with a failure to provide
notice pursuant to Section 6.03(a) shall be deemed not to be “continuing” or “existing” and shall be deemed cured upon delivery
of such notice unless the Borrower knowingly fails to give timely notice of such Default or Event of Default as required
hereunder.
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(iv)
Administrative Agent Notice. Upon, or prior to, taking any of the actions set forth in Section 8.02(a) or (b),
the Administrative Agent shall, on behalf of the Required Lenders deliver a notice of Default, Event of Default or acceleration, as
applicable, to the Borrower.
For the avoidance of doubt, unless a Default or an Event of Default has occurred and is continuing, the Administrative Agent (and each other
Secured Party) shall not take any of the actions described in this Section 8.02 or bring an action or proceeding under the Loan Documents or
with respect to the Obligations.
Section 8.03
Application of Funds
. After the exercise of remedies provided for in Section 8.02 (or after the Loans have automatically become immediately due and
payable as set forth in the proviso to Section 8.02(a)), any amounts received on account of the Obligations shall, subject to the Intercreditor
Agreements, be applied by the Administrative Agent in the following order:
First, to payment of that portion of the Obligations constituting fees, indemnities, expenses and other amounts (other than
principal and interest, but including Attorney Costs payable under Section 10.04 and amounts payable under Article III) payable to
the Administrative Agent and the Collateral Agent in their capacities as such;
Next, to payment in full of Unfunded Advances/Participations (the amounts so applied to be distributed between or among, as
applicable, the Administrative Agent pro rata in accordance with the amounts of Unfunded Advances/Participations owed on the
date of any such distribution);
Next, to payment of that portion of the Obligations constituting fees, indemnities and other amounts (other than principal, interest,
Obligations under Secured Hedge Agreements and Cash Management Obligations) payable to the Lenders (including Attorney
Costs payable under Section 10.04 and amounts payable under Article III) ratably among them in proportion to the amounts
described in this clause Third payable to them;
Next, to payment of that portion of the Obligations constituting accrued and unpaid interest on the Loans, ratably among the
Lenders in proportion to the respective amounts described in this clause held by them;
Next, to payment of that portion of the Obligations constituting unpaid principal of the Loans and the Obligations under Secured
Hedge Agreements and Cash Management Obligations ratably among the Secured Parties in proportion to the respective amounts
described in this clause held by them; provided that that Excluded Swap Obligations with respect to any Guarantor shall not be
paid with amounts received from such Guarantor or its assets, but appropriate adjustments shall be made with respect to payments
from other Loan Parties to preserve the allocation to Obligations otherwise set forth above in this Section 8.03;
Next, to the payment of all other Obligations that are due and payable to the Administrative Agent and the other Secured Parties on
such date, ratably based upon the respective aggregate amounts of all such Obligations owing to the Administrative Agent and the
other Secured Parties on such date; and
Last, the balance, if any, after all of the Obligations have been paid in full, to the Borrower or as otherwise required by Law.
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ARTICLE IX.
ADMINISTRATIVE AGENT AND OTHER AGENTS
Section 9.01
Appointment and Authority of the Administrative Agent
.
(a)
Each Lender hereby irrevocably appoints Barclays Bank PLC to act on its behalf as the Administrative Agent
hereunder and under the other Loan Documents and authorizes the Administrative Agent to take such actions on its behalf and to exercise
such powers as are delegated to the Administrative Agent by the terms hereof or thereof, together with such actions and powers as are
reasonably incidental thereto. The provisions of this Article IX (other than Section 9.09 and Section 9.11) are solely for the benefit of the
Administrative Agent and the Lenders, and neither the Borrower nor any Loan Party shall have any rights as a third party beneficiary of any
such provision.
(b)
The Administrative Agent shall irrevocably act as the “collateral agent” under the Loan Documents, and each of the
Lenders (including in its capacities as a potential Hedge Bank and/or Cash Management Bank) hereby irrevocably appoints and authorizes
the Administrative Agent to act as the agent of (and to hold any security interest created by the Collateral Documents for and on behalf of or
in trust for) such Lender for purposes of acquiring, holding and enforcing any and all Liens on Collateral granted by any of the Loan Parties
to secure any of the Obligations, together with such powers and discretion 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 and Section 9.12 for purposes of holding or enforcing any Lien on the Collateral (or any portion thereof) granted
under the Collateral Documents, or for exercising any rights and remedies thereunder at the direction of the Administrative Agent), shall be
entitled to the benefits of all provisions of this Article IX (including Section 9.07, as though such co-agents, sub-agents and attorneys-in-fact
were the “collateral agent” under the Loan Documents) as if set forth in full herein with respect thereto. Without limiting the generality of the
foregoing, the Lenders and each other Secured Party hereby expressly authorize the Administrative Agent to execute any and all documents
(including releases) with respect to the Collateral and the rights of the Secured Parties with respect thereto (including the Intercreditor
Agreements), as contemplated by and in accordance with the provisions of this Agreement and the Collateral Documents and acknowledge
and agree that any such action by any Agent shall bind the Lenders and each other Secured Party.
Section 9.02
Rights as a Lender
. Any Lender that is also serving as an Agent (including as Administrative Agent) hereunder shall have the same rights and powers
(and no additional duties or obligations) in its capacity as a Lender as any other Lender and may exercise the same as though it were not an
Agent, and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include each
Lender (if any) serving as an Agent hereunder in its individual capacity. Any Person serving as an Agent and its Affiliates and branches may
accept deposits from, lend money to, own securities of, act as the financial advisor or in any other advisory capacity for and generally engage
in any kind of banking, trust or other business with the Borrower or any Subsidiary or other Affiliate thereof as if such Person were not an
Agent hereunder and without any duty to account therefor to the Lenders, and may accept fees and other consideration from the Borrower for
services in connection herewith and otherwise without having to account for the same to the Lenders. The Lenders acknowledge that,
pursuant to such activities, any Agent or its Affiliates or branches may receive information regarding any Loan Party or any of its Affiliates
(including information that may be subject to confidentiality obligations in favor of such Loan Party or such Affiliate) and acknowledge that
no Agent shall be under any obligation to provide such information to them.
Section 9.03
Exculpatory Provisions
. None of the Administrative Agent, any of the other Agents, any of their respective Affiliates or branches, nor any of the officers,
partners, directors, employees or
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agents of the foregoing shall have any duties or obligations to the Lenders except those expressly set forth in the Loan Documents. Without
limiting the generality of the foregoing, an Agent (including the Administrative Agent) or any of their respective officers, partners, directors,
employees or agents:
(a)
shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is
continuing and without limiting the generality of the foregoing, the use of the term “agent” herein and in the other Loan Documents with
reference to any Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under any agency doctrine of
any applicable Law and instead, such term is used merely as a matter of market custom, and is intended to create or reflect only an
administrative relationship between independent contracting parties;
(b)
shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary
actions and powers expressly contemplated by the Loan Documents that such Agent is required to exercise as directed in writing by the
Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan
Documents), provided that, notwithstanding any direction by the Required Lenders to the contrary, no Agent shall be required to take any
such discretionary action that, in its opinion or the opinion of its counsel, may expose such Agent to liability or that is contrary to any Loan
Document or applicable Law, including for the avoidance of doubt refraining from any action that, in its opinion or the opinion of its counsel,
may be in violation of the automatic stay under any Debtor Relief Law or that may effect a forfeiture, modification or termination of property
of a Defaulting Lender in violation of any Debtor Relief Law;
(c)
shall not have any duty or responsibility to disclose, and shall not be liable for the failure to disclose to any Lender, any
credit or other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any
of the Loan Parties or any of their Affiliates, information relating to the Borrower or any of its Affiliates that is communicated to, obtained by
or in possession of the Person serving as the Administrative Agent, a Lead Arranger or any of its their respective Affiliates or branches in any
capacity, except for notices, reports and other documents expressly required herein to be furnished to the Lenders by the Administrative
Agent or the Lead Arranger, as applicable; and
(d)
shall not be liable to the Lenders for any action taken or omitted to be taken under or in connection with any of the
Loan Documents except to the extent caused by such Agent’s gross negligence or willful misconduct as determined by a final, non-
appealable judgment of a court of competent jurisdiction.
The Administrative Agent shall not be liable to the Lenders 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 be necessary, under the circumstances as provided in Section 8.02 and Section 10.01) or (ii) in the absence of
its own gross negligence or willful misconduct or of a material breach by the Administrative Agent of its obligations under the Loan
Documents as determined by a final, non-appealable judgment of a court of competent jurisdiction, in connection with its duties expressly
set forth herein. The Administrative Agent shall be deemed not to have knowledge of any Default or Event of Default unless and until notice
describing such Default or Event of Default is given to the Administrative Agent by the Borrower or the Required Lenders in writing.
No Agent-Related Person shall be responsible for or have any duty to ascertain or inquire into (i) any recital, statement, warranty
or representation made in or in connection with any Loan Document, (ii) the contents of any certificate, report, statement or agreement or
other document delivered pursuant to a Loan Document thereunder or in connection with a Loan Document or referred to or provided for in,
or
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received by the Administrative Agent under or in connection with any Loan Document, (iii) the performance or observance of any of the
covenants, agreements or other terms or conditions set forth in any Loan Document or the occurrence of any Default or Event of Default, (iv)
the validity, enforceability, effectiveness or genuineness of any 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 in a Loan Document, other than to confirm receipt of
items expressly required to be delivered to the Administrative Agent, or to inspect the properties, books or records of any Loan Party or any
Affiliate thereof.
The Administrative Agent shall not be responsible or have any liability for, or have any duty to ascertain, inquire into, monitor or
enforce, compliance with the provisions hereof relating to Disqualified Lenders or Net Short Lenders. Without limiting the generality of the
foregoing, the Administrative Agent shall not (x) be obligated to ascertain, monitor or inquire as to whether any Lender or Participant or
prospective Lender or Participant is a Disqualified Lender or Net Short Lender, (y) have any liability with respect to or arising out of any
assignment or participation of commitments or loans, or disclosure of confidential information, to any Disqualified Lender or Net Short
Lender or (z) have any liability with respect to or arising out of the voting in any amendment or waiver to any Loan Document by any Net
Short Lender. The list of Disqualified Lenders shall be specified on a schedule that is held with the Administrative Agent, which list may be
provided to any Lender or its proposed assignee upon request.
Section 9.04
Reliance by the Agents
. The Agents shall be entitled to rely upon, and shall not incur any liability to any Lender for relying upon, any notice, request,
certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting
or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper Person. Each Agent
also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper Person, and shall not
incur any liability for relying thereon. In determining compliance with any condition hereunder to the making of a Loan that by its terms
must be fulfilled to the satisfaction of a Lender, each Agent may presume that such condition is satisfactory to such Lender unless the
Administrative Agent shall have received notice to the contrary from such Lender prior to the making of such Loan. Each Agent may consult
with legal counsel (who may be counsel for the Borrower), independent accountants and other experts selected by it, and shall not be liable to
any Lender for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.
Each Agent shall be fully justified in failing or refusing to take any discretionary action under any Loan Document unless it shall
first receive such advice or concurrence of the Required Lenders (or other requisite percentage of Lenders) and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability and expense which may be incurred by it by reason of taking or
continuing to take any such action. The Agents shall in all cases be fully protected in taking any discretionary action, or in refraining from
taking any discretionary action under any Loan Document in accordance with a request or consent of the Required Lenders (or such greater
number of Lenders as may be expressly required hereby in any instance) and such request and any action taken or failure to act pursuant
thereto shall be binding upon all the Lenders; provided that the Agents shall not be required to take any discretionary action that, in their
opinion or in the opinion of their counsel, may expose such Agent to liability or that is contrary to any Loan Document or applicable
Law. Notwithstanding the foregoing, the Administrative Agent and the Collateral Agent shall not act (or refrain from acting, as applicable)
upon any direction from the Required Lenders (or other requisite percentage of Lenders) that would cause the Administrative Agent to be in
breach of any express term or provision of this Agreement. The Lenders and each other Secured Party agree not to instruct the
Administrative Agent, Collateral Agent or any other Agent to take any action, or refrain from taking any action, that would, in each case,
cause it to violate an express duty or obligation under this Agreement.
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Section 9.05
Delegation of Duties
. Each Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan
Documents by or through any one or more sub agents appointed by such Agent. Each Agent and any such sub agent may perform any and all
of its duties and exercise its rights and powers by or through their respective Agent-Related Persons. The exculpatory provisions of this
Article IX shall apply to any such sub agent and to the Agent-Related Persons of the Agents and any such sub agent, and shall apply to their
respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as the Agents.
Notwithstanding anything herein to the contrary, with respect to each sub agent appointed by an Agent, (i) such sub agent shall be a third
party beneficiary under this Agreement with respect to all such rights, benefits and privileges (including exculpatory rights and rights to
indemnification) and shall have all of the rights and benefits of a third party beneficiary, including an independent right of action to enforce
such rights, benefits and privileges (including exculpatory rights and rights to indemnification) directly, without the consent or joinder of any
other Person, against any or all of the Loan Parties and the Lenders, (ii) such rights, benefits and privileges (including exculpatory rights and
rights to indemnification) shall not be modified or amended without the consent of such sub agent, and (iii) such sub agent shall only have
obligations to the Agent that appointed it as sub agent and not to any Loan Party, Lender or any other Person and no Loan Party, Lender or
any other Person shall have any rights, directly or indirectly, as a third party beneficiary or otherwise, against such sub agent. Each Agent
shall not be responsible for the negligence 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 such Agent acted with gross negligence or willful misconduct in the selection of such
sub agents.
Section 9.06
Non-Reliance on Agents and Other Lenders; Disclosure of Information by Agents
.
(a)
Each Lender expressly acknowledges that no Agent-Related Person has made any representation or warranty to it, and
that no act by any Agent hereafter taken, including any consent to and acceptance of any assignment or review of the affairs of any Loan
Party or any Affiliate thereof, shall be deemed to constitute any representation or warranty by any Agent-Related Person to any Lender as to
any matter, including whether Agent-Related Persons have disclosed material information in their possession. Each Lender represents to each
Agent that it has, independently and without reliance upon any Agent-Related Person and based on such documents and information as it has
deemed appropriate, made its own appraisal of, and investigation into, the business, prospects, operations, property, financial and other
condition and creditworthiness of the Loan Parties and their respective Subsidiaries, and all applicable bank or other regulatory Laws relating
to the transactions contemplated hereby, and made its own decision to enter into this Agreement and to extend credit to the Borrower and the
other Loan Parties hereunder. Each Lender also represents that it will, independently and without reliance upon any Agent, any other Lender
or any Agent-Related Person and based on such documents and information as it shall deem appropriate at the time, continue to make its own
credit analysis, appraisals and decisions in taking or not taking action under this Agreement and the other Loan Documents, and to make such
investigations as it deems necessary to inform itself as to the business, prospects, operations, property, financial and other condition and
creditworthiness of the Borrower and the other Loan Parties. Except for notices, reports and other documents expressly required to be
furnished to the Lenders by any Agent herein, such Agent shall not have any duty or responsibility to provide any Lender with any credit or
other information concerning the business, prospects, operations, property, financial and other condition or creditworthiness of any of the
Loan Parties or any of their respective Affiliates which may come into the possession of any Agent-Related Person. Each Lender represents
and warrants that (i) the Loan Documents set forth the terms of a commercial lending facility and (ii) it is engaged in making, acquiring or
holding commercial loans in the ordinary course and is entering into this Agreement as a Lender for the purpose of making, acquiring or
holding commercial loans and providing other facilities set forth herein as may be applicable to such Lender, and not for the purpose of
purchasing, acquiring or holding any other type of financial instrument, and each Lender agrees not to assert a claim in contravention of the
foregoing. Each Lender represents and warrants that it is sophisticated with respect to decisions to make, acquire and/or hold commercial
loans
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and to provide other facilities set forth herein, as may be applicable to such Lender, and either it, or the Person exercising discretion in
making its decision to make, acquire and/or hold such commercial loans or to provide such other facilities, is experienced in making,
acquiring or holding such commercial loans or providing such other facilities.
(b)
Each Lender, by delivering its signature page to this Agreement or an Assignment and Assumption and funding its
Term Loan on the Closing Date, shall be deemed to have acknowledged receipt of, and consented to and approved, each Loan Document and
each other document required to be approved by any Agent, Required Lenders or Lenders, as applicable on the Closing Date.
Section 9.07
Indemnification of Agents
. Whether or not the transactions contemplated hereby are consummated, the Lenders shall indemnify upon demand the
Administrative Agent, each Agent and each other Agent-Related Person (solely to the extent any such Agent-Related Person was performing
services on behalf of any Agent, as applicable) (without limiting any indemnification obligation of any Loan Party to do so), pro rata, and
hold harmless the Administrative Agent, each Agent and each other Agent-Related Person (solely to the extent any such Agent-Related
Person was performing services on behalf of any Agent) from and against any and all Indemnified Liabilities incurred by it; provided that no
Lender shall be liable for the payment to any Agent-Related Person of any portion of such Indemnified Liabilities resulting from such Agent-
Related Person’s own gross negligence or willful misconduct, as determined by a final, non-appealable judgment of a court of competent
jurisdiction; provided that, no action taken in accordance with the terms of a Loan Document or in accordance with the directions of the
Required Lenders (or such other number or percentage of the Lenders as shall be required by the Loan Documents) shall be deemed to
constitute gross negligence or willful misconduct for purposes of this Section 9.07. If any indemnity furnished to any Agent for any purpose
shall, in the opinion of such Agent, be insufficient or become impaired, such Agent may call for additional indemnity and cease, or not
commence, to do the acts indemnified against until such additional indemnity is furnished; provided, in no event shall this sentence require
any Lender to indemnify any Agent against any Indemnified Liabilities in excess of such Lender’s pro rata share thereof; and provided
further, this sentence shall not be deemed to require any Lender to indemnify any Agent against any Indemnified Liabilities described in the
first proviso in the immediately preceding sentence. In the case of any investigation, litigation or proceeding giving rise to any Indemnified
Liabilities, this Section 9.07 applies whether any such investigation, litigation or proceeding is brought by any Lender or any other
Person. Without limitation of the foregoing, each Lender shall reimburse each Agent upon demand for its ratable share of any costs or out-
of-pocket expenses (including Attorney Costs) incurred by such Agent in connection with the preparation, execution, delivery,
administration, modification, amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or legal advice in
respect of rights or responsibilities under, this Agreement, any other Loan Document, or any document contemplated by or referred to herein,
to the extent that such Agent is not reimbursed for such expenses by or on behalf of the Borrower; provided that such reimbursement by the
Lenders shall not affect the Borrower’s continuing reimbursement obligations with respect thereto; provided further that the failure of any
Lender to indemnify or reimburse such Agent shall not relieve any other Lender of its obligation in respect thereof. The undertaking in this
Section 9.07 shall survive termination of the Aggregate Commitments, the payment of all other Obligations and the resignation of the
Administrative Agent, Collateral Agent and other Agents.
Section 9.08
No Other Duties; Other Agents, Lead Arranger, Managers, Etc.
Barclays PLC, BMO Capital Markets Corp., Credit Suisse Loan Funding LLC and Wells Fargo Securities, LLC is each hereby
appointed as a Lead Arranger hereunder, and each Lender hereby authorizes each of Barclays PLC, BMO Capital Markets Corp., Credit
Suisse Loan Funding LLC and Wells Fargo Securities, LLC to act as a Lead Arranger in accordance with the terms hereof and the other Loan
Documents.
Each Agent hereby agrees to act in its capacity as such upon the express conditions contained herein and the other Loan
Documents, as applicable. Anything herein to the contrary notwithstanding, none of the
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Lead Arrangers or the other Agents listed on the cover page hereof (or any of their respective Affiliates or branches) shall have any powers,
duties or responsibilities under this Agreement or any of the other Loan Documents, except (a) in its capacity, as applicable, as the
Administrative Agent, the Collateral Agent or a Lender hereunder and (b) as provided in Section 10.01(b)(iv), and such Persons shall have
the benefit of this Article IX. Without limiting the foregoing, none of the Lenders or other Persons so identified shall have or be deemed to
have any agency or fiduciary or trust relationship with any Lender, Holdings, the Borrower or any of their respective Subsidiaries. Each
Lender acknowledges that it has not relied, and will not rely, on any of the Lenders or other Persons so identified in deciding to enter into this
Agreement or in taking or not taking action hereunder. Any Agent may resign from such role at any time, with immediate effect, by giving
prior written notice thereof to the Administrative Agent and Borrower.
Section 9.09
Resignation of Administrative Agent or Collateral Agent
. The Administrative Agent or the Collateral Agent may at any time give notice of its resignation to the Lenders and the Borrower.
Upon receipt of any such notice of resignation, the Required Lenders shall have the right, subject to the consent of the Borrower (such
consent not to be unreasonably withheld, conditioned or delayed), at all times other than during the existence of a Specified Event of Default,
to appoint a successor, which shall be a Lender or a bank with an office in the United States, or an Affiliate or branch of any such Lender or
bank with an office in the United States. If no such successor shall have been so appointed by the Required Lenders and shall have accepted
such appointment within thirty days after the retiring Administrative Agent or Collateral Agent, as applicable, gives notice of its resignation,
then the retiring Administrative Agent or Collateral Agent, as applicable, may on behalf of the Lenders, appoint a successor Administrative
Agent or Collateral Agent, meeting the qualifications set forth above; provided that if the Administrative Agent or Collateral Agent, as
applicable, shall notify the Borrower and the Lenders that no qualifying Person has accepted such appointment, then such resignation shall
nonetheless become effective in accordance with such notice and (a) the retiring Administrative Agent or Collateral Agent, as applicable,
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 or Collateral Agent on behalf of the Lenders under any of the Loan Documents, the retiring Agent
shall continue to hold such collateral security until such time as a successor of such Agent is appointed) and (b) except for any indemnity
payments or other amounts owed to the retiring or retired Administrative Agents, all payments, communications and determinations provided
to be made by, to or through the Administrative Agent shall instead be made by or to each Lender directly, until such time as the Required
Lenders appoint a successor Administrative Agent as provided for above in this Section). If neither the Required Lenders nor the
Administrative Agent have appointed a successor Administrative Agent, the Required Lenders shall be deemed to have succeeded to and
become vested with all the rights, powers, privileges and duties of the retiring Administrative Agent (subject to the proviso in the sentence
above). Upon the acceptance of a successor’s appointment as Administrative Agent or Collateral Agent, as applicable, hereunder and upon
the execution and filing or recording of such financing statements, or amendments thereto, and such amendments or supplements to the
Mortgages, and such other instruments or notices, as may be necessary or appropriate, or as the Required Lenders may request, in order to
perfect or continue the perfection of the Liens granted or purported to be granted by the Collateral Documents, such successor shall succeed
to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Administrative Agent or Collateral Agent,
as applicable (other than any rights to indemnity payments or other amounts owed to the retiring or retired Administrative Agent), and the
retiring Administrative Agent or Collateral Agent, as applicable, shall be discharged from all of its duties and obligations hereunder or under
the other Loan Documents (if not already discharged therefrom as provided above in this Section 9.09). The fees payable by the Borrower to
a successor Administrative Agent or Collateral Agent, as applicable, shall be the same as those payable to its predecessor unless otherwise
agreed between the Borrower and such successor. After the retiring Agent’s resignation hereunder and under the other Loan Documents, the
provisions of this Article IX, Section 10.04 and Section 10.05 shall continue in effect for the benefit of such retiring Agent, its sub-agents and
their respective Agent-Related Persons in respect of any actions taken or omitted to be taken by any of them while the retiring Agent was
acting as Administrative Agent or Collateral Agent, as applicable.
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Section 9.10
Administrative Agent May File Proofs of Claim; Credit Bidding
. In case of the pendency of any proceeding under any Debtor Relief Law or any other judicial proceeding relative to any Loan
Party, the Administrative Agent (irrespective of whether the principal of any Loan shall then be due and payable as herein expressed or by
declaration or otherwise and irrespective of whether the Administrative Agent shall have made any demand on the Borrower) shall be entitled
and empowered (but not obligated), by intervention in such proceeding or otherwise:
(a)
to file a verified statement pursuant to rule 2019 of the Federal Rules of Bankruptcy Procedure or other applicable
Debtor Relief Law that, in its sole opinion, complies with the disclosure requirements under such rule or Debtor Relief Law for entities
representing more than one creditor;
(b)
to file and prove a claim for the whole amount of the principal and interest owing and unpaid in respect of the Loans
and all other Obligations that are owing and unpaid and to file such other documents as may be necessary or advisable in order to have the
claims of the Lenders and the Administrative Agent (including any claim for the reasonable compensation, expenses, disbursements and
advances of the Lenders and the Administrative Agent and their respective agents and counsel and all other amounts due the Lenders and the
Administrative Agent under Section 2.08 and Section 10.04) allowed in such judicial proceeding; and
(c)
to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the
same;
and any custodian, receiver, interim receiver, receiver and manager, monitor, assignee, trustee, liquidator, sequestrator or other similar official
in any such judicial proceeding is hereby authorized by each Lender to make such payments to the Administrative Agent and, in the event
that the Administrative Agent shall consent to the making of such payments directly to the Lenders, to pay to the Administrative Agent any
amount due for the reasonable compensation, expenses, disbursements and advances of the Agents and their respective agents and counsel,
and any other amounts due the Administrative Agent under Section 2.08 and Section 10.04. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Administrative Agent, its agents and counsel, and any other amounts due the
Administrative Agent under Section 2.08 and Section 10.04 out of the estate in any such proceeding, shall be denied for any reason, payment
of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties
that the Lenders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or
proposal or otherwise.
Nothing contained herein shall be deemed to authorize the Administrative Agent to authorize or consent to or accept or adopt on
behalf of any Lender any plan of reorganization, arrangement, adjustment or composition or proposal affecting the Obligations or the rights
of any Lender or to authorize the Administrative Agent to vote in respect of the claim of any Lender in any such proceeding.
The Secured Parties hereby irrevocably authorize the Administrative Agent, at the direction of the Required Lenders, to credit bid
all or any portion of the Obligations (including accepting some or all of the Collateral in satisfaction of some or all of the Obligations
pursuant to a deed in lieu of foreclosure or otherwise) and in such manner purchase (either directly or through one or more acquisition
vehicles) all or any portion of the Collateral (i) at any sale thereof conducted under the provisions of the Bankruptcy Code, including under
Sections 363, 1123 or 1129 of the Bankruptcy Code, or any Debtor Relief Laws or similar Laws in any other jurisdictions to which a Loan
Party is subject, (ii) at any other sale or foreclosure or acceptance of collateral in lieu of debt conducted by (or with the consent or at the
direction of) the Administrative Agent (whether by judicial action or otherwise) in accordance with any applicable Law. In connection with
any such credit bid and purchase, the Obligations owed to the Secured Parties shall be
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entitled to be, and shall be, credit bid on a ratable basis (with Obligations with respect to contingent or unliquidated claims receiving
contingent interests in the acquired assets on a ratable basis that would vest upon the liquidation of such claims in an amount proportional to
the liquidated portion of the contingent claim amount used in allocating the contingent interests) in the asset or assets so purchased (or in the
Equity Interests or debt instruments of the acquisition vehicle or vehicles that are used to consummate such purchase). In connection with any
such bid (A) the Administrative Agent shall be authorized to form one or more acquisition vehicles to make a bid, (B) to adopt documents
providing for the governance of the acquisition vehicle or vehicles (provided that any actions by the Administrative Agent with respect to
such acquisition vehicle or vehicles, including any disposition of the assets or Equity Interests thereof, shall be governed, directly or
indirectly, by the vote of the Required Lenders, irrespective of the termination of this Agreement and without giving effect to the limitations
on actions by the Required Lenders contained in Section 10.01 of this Agreement), (C) the Administrative Agent shall be authorized to assign
the relevant Obligations to any such acquisition vehicle pro rata by the Lenders, as a result of which each of the Lenders shall be deemed to
have received a pro rata portion of any Equity Interests and/or debt instruments issued by such an acquisition vehicle on account of the
assignment of the Obligations to be credit bid, all without the need for any Secured Party or acquisition vehicle to take any further action and
(D) to the extent that Obligations that are assigned to an acquisition vehicle are not used to acquire Collateral for any reason (as a result of
another bid being higher or better, because the amount of Obligations assigned to the acquisition vehicle exceeds the amount of debt credit
bid by the acquisition vehicle or otherwise), such Obligations shall automatically be reassigned to the Lenders pro rata and the Equity
Interests and/or debt instruments issued by any acquisition vehicle on account of the Obligations that had been assigned to the acquisition
vehicle shall automatically be cancelled, without the need for any Secured Party or any acquisition vehicle to take any further action.
Section 9.11
Collateral and Guaranty Matters
.
(a)
Each Agent, each Lender (including in its capacities as a potential Cash Management Bank and a potential Hedge
Bank) and each other Secured Party irrevocably authorizes the Administrative Agent and Collateral Agent to be the agent for and
representative of the Lenders with respect to the Guaranty, the Collateral and the Collateral Documents and agrees that, notwithstanding
anything to the contrary in any Loan Document:
(i)
Liens on any property granted to or held by an Agent or in favor of any Secured Party under any Loan
Document will be automatically and immediately released, and each Secured Party irrevocably authorizes and directs the Agents
to enter into, and each Secured Party and Agent agrees that it will enter into, the necessary or advisable documents requested by
the Borrower and associated therewith, upon the occurrence of any of the following events (each, a “Lien Release Event”),
(A)
the payment in full in cash of all the Obligations (other than Cash Management Obligations,
Obligations in respect of Secured Hedge Agreements and contingent obligations in respect of which no claim has been
made);
(B)
a transfer of the property subject to such Lien as part of, or in connection with, a transaction that is
permitted (or not prohibited) by the terms of the Loan Documents to any Person that is not a Loan Party;
(C)
with respect to property owned by any Guarantor or with respect to which any Guarantor has rights
(with respect to the rights of such Guarantor), the release of such Guarantor from its obligations under its Guaranty
pursuant to a Guaranty Release Event;
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(D)
the approval, authorization or ratification of the release of such Lien by the Required Lenders or
such percentage as may be required pursuant to Section 10.01;
(E)
such property becoming an Excluded Asset, Excluded Equity Interest or an asset owned by an
Excluded Subsidiary or with respect to which an Excluded Subsidiary (and no other Loan Party) has rights;
(F)
as to the assets owned by such Excluded Subsidiary (or with respect to which an Excluded
Subsidiary (and no other Loan Party) has rights), upon any Person becoming an Excluded Subsidiary; and/or
(G)
any such Securitization Assets becoming subject to a Securitization Financing to the extent
required by the terms of such Securitization Financing;
(ii)
upon the request of the Borrower (such request, the “Release/Subordination Event”) it will release or
subordinate any Lien on any property granted to or held by the Administrative Agent or the Collateral Agent under any Loan
Document to the holder of any Lien on such property that is permitted by Section 7.01(d);
(iii)
a Subsidiary Guarantor will be automatically and immediately released from its obligations under the
Guaranty upon (A) such Subsidiary Guarantor ceasing to be a Subsidiary of the Borrower, (B) such Subsidiary Guarantor ceasing
to be a Material Subsidiary, unless and until it does not constitute an Excluded Subsidiary per the Borrower’s designation, in its
sole discretion, under the last paragraph of the definition of “Excluded Subsidiary” or (C) such Subsidiary Guarantor becoming an
Excluded Subsidiary (including pursuant to the Borrower’s designation under the last paragraph of the definition of ‘Excluded
Subsidiary” but other than pursuant to clause (a) of the definition thereof, to the extent a result of the transfer of Equity Interests in
such Subsidiary Guarantor to an Affiliate of the Borrower) as a result of a transaction permitted hereunder (clauses (A)-(C), each a
“Guaranty Release Event”); provided that no Subsidiary Guarantor will be released from its obligations under the Guaranty upon
a sale of less than all of such Subsidiary’s Equity Interests, unless such sale is a good faith disposition to a bona fide unaffiliated
third party for fair market value and for bona fide business purposes, and each Secured Party irrevocably authorizes and directs the
Agents to enter into, and each Agent agrees it will enter into, the necessary and advisable documents requested by the Borrower to
(1) release (or acknowledge the release of) such Subsidiary Guarantor from its obligations under the Guaranty and (2) release (or
acknowledge the release of) any Liens granted by such Subsidiary or Liens on the Equity Interests of such Subsidiary;
(iv)
the Administrative Agent and the Collateral Agent will exclusively exercise the rights and remedies under
the Loan Documents, and neither the Lenders nor any other Secured Party will exercise such rights and remedies (other than the
Required Lenders exercising such rights and remedies through the Administrative Agent); provided that the foregoing shall not
preclude any Lender from exercising any right of set-off in accordance with the provisions of Section 10.09, enforcing compliance
with the provisions set forth in Section 10.01(b) or from exercising rights and remedies (other than the enforcement of Collateral)
with respect to any payment default after the occurrence of the Maturity Date with respect to any Loans made by it or filing proofs
of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party under
any Debtor Relief Law; and
(v)
the Administrative Agent and Collateral Agent shall, and the Lenders and other Secured Parties irrevocably
authorize and instruct the Administrative Agent and Collateral Agent
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to, from time to time on and after the Closing Date, without any further consent of any Lender counterparty to any Cash
Management Obligation or Secured Hedge Agreement or other Secured Party, (i) enter into any Intercreditor Agreement or other
intercreditor agreement with the collateral agent or other representative of the holders of Indebtedness that is secured by a Lien on
Collateral the entering into of which is expressly provided for (including with respect to priority) under this Agreement or (ii)
subordinate any Lien on any property granted to or held by the Administrative Agent or the Collateral Agent under any Loan
Document to the holder of any Permitted Lien on such property in respect of any Indebtedness that has priority as a matter of law
or is expressly permitted hereunder to be incurred and secured on a priority lien basis to the Liens securing Obligations.
(b)
Each Agent, each Lender and each other Secured Party agrees that it will promptly take such action and execute any
such documents in a form reasonably satisfactory to the Administrative Agent as may be reasonably requested by the Borrower (such actions
and such execution, the “Release Actions”), at the Borrower’s sole cost and expense, in connection with a Lien Release Event,
Release/Subordination Event or Guaranty Release Event and that such actions are not discretionary. Without limitation, the Release Actions
may include, as applicable, (a) executing (if required) and delivering to the Loan Parties (or any designee of the Loan Parties) any such lien
releases, mortgage releases or assignments of mortgages, discharges of security interests, pledges and guarantees and other similar discharge
or release documents, as are reasonably requested by a Loan Party in connection with the release, as of record, of the Liens (and all notices of
security interests and Liens previously filed) the subject of a Lien Release Event or Release/Subordination Event or the release of any
applicable Guarantee in connection with a Guaranty Release Event and (b) delivering to the Loan Parties (or any designee of the Loan
Parties) all instruments evidencing pledged debt and all equity certificates and any other collateral previously delivered in physical form by
the Loan Parties to a Secured Party.
In connection with any Lien Release Event, Release/Subordination Event, Guaranty Release Event or Release Action, each of the
Collateral Agent, the Administrative Agent and each Secured Party shall be entitled to rely and shall rely exclusively on an officer’s
certificate of the Borrower (the “Release Certificate”) confirming that (a) such Lien Release Event, Release/Subordination Event or a
Guaranty Release Event, as applicable, has occurred or will upon consummation of one or more identified transactions (an “Identified
Transaction”) occur, (b) the conditions to any such Lien Release Event, Release/Subordination Event or Guaranty Release Event have
occurred or will occur upon consummation of an Identified Transaction, and (c) that any such Identified Transaction is permitted by (or not
prohibited by) the Loan Documents. The Collateral Agent and the Administrative Agent will be fully exculpated from any liability and shall
be fully protected and shall not have any liability whatsoever to any Secured Party as a result of such reliance or the consummation of any
Release Action. A Release Certificate may be delivered in advance of the consummation of any applicable Identified Transaction.
Each Lender and each Secured Party irrevocably authorizes and irrevocably directs the Collateral Agent and the Administrative
Agent to take the Release Actions and consents to reliance on the Release Certificate. The Secured Parties agree not to give any Agent any
instruction or direction inconsistent with the provisions of this Section 9.11. Neither the Administrative Agent nor the Collateral Agent shall
be responsible for, or have a duty to ascertain or inquire into, any statement in a Release Certificate, the compliance of any Identified
Transaction with the terms of a Loan Document, any representation or warranty regarding the existence, value or collectability of the
Collateral, the existence, priority or perfection of the Collateral Agent’s Lien thereon, or contained in any certificate prepared or delivered by
any Loan Party in connection with the Collateral or compliance with the terms set forth above or in a Loan Document, nor shall the
Administrative Agent or Collateral Agent be responsible or liable to the Lenders for any failure to monitor or maintain any portion of the
Collateral or validity, perfection or priority of any lien thereon.
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Each relevant Agent, each Lender and each other Secured Party agrees that following its receipt of an applicable Release
Certificate it will take all Release Actions promptly upon request of the Borrower and in any event not later than the date that is (i) the third
Business Day following the date Release Certificate is delivered to the Administrative Agent and (ii) the date any applicable Identified
Transaction described in the Release Certificate is consummated (such latter date, the “Release Date”). Notwithstanding the foregoing,
nothing set forth in this Section 9.11 shall relieve or release any Loan Party from any liability resulting from a Default or Event of Default
that results from an Identified Transaction or misrepresentation or omission in any Release Certificate.
(c)
Anything contained in any of the Loan Documents to the contrary notwithstanding, each Agent, each Lender and each
Secured Party hereby agree that:
(i)
no Lender or other Secured Party shall have any right individually to realize upon any of the Collateral or to
enforce the Guaranty or any other Loan Document or enforce any rights or remedies thereunder, it being understood and agreed
that all powers, rights and remedies hereunder and under any of the Loan Documents may be exercised solely by the
Administrative Agent or the Collateral Agent, as applicable, for the benefit of the Lenders in accordance with the terms hereof and
thereof, and all powers, rights and remedies under the Collateral Documents may be exercised solely by the Collateral Agent for
the benefit of the Lenders in accordance with the terms thereof;
(ii)
in the event of a foreclosure or similar enforcement 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 Bankruptcy Code or other Debtor Relief Law), the Collateral Agent or the Administrative Agent
(except with respect to a “credit bid” pursuant to Section 363(k), Section 1129(b)(2)(a)(ii) or otherwise of the Bankruptcy Code or
other Debtor Relief Law) may be the purchaser or licensor of any or all of such Collateral at any such sale or other disposition, and
the Collateral Agent, as agent for and representative of Lenders (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 sale or disposition, to use and apply any of
the Obligations as a credit on account of the purchase price for any collateral payable by the Collateral Agent at such sale or other
disposition;
(iii)
no provision of any Loan Documents shall require the creation, perfection or maintenance of pledges of or
security interests in, or the obtaining of title insurance or abstracts with respect to, any Excluded Assets, Excluded Equity Interests
and any other particular assets, if and for so long as, in the reasonable judgment of the Collateral Agent, the cost of creating,
perfecting or maintaining such pledges or security interests in such other particular assets or obtaining title insurance or abstracts
in respect of such other particular assets is excessive in view of the fair market value of such assets or the practical benefit to the
Lenders afforded thereby; and
(iv)
the Collateral Agent may grant extensions of time for the creation or perfection of security interests in or the
obtaining of title insurance and surveys with respect to particular assets (including extensions beyond the Closing Date for the
creation or perfection of security interests in the assets of the Loan Parties on such date) where it reasonably determines, in
consultation with the Borrower, that creation or perfection cannot be accomplished without undue effort or expense by the time or
times at which it would otherwise be required by this Agreement or the Collateral Documents.
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Section 9.12
Appointment of Supplemental Administrative Agents
.
(a)
It is the purpose of this Agreement and the other Loan Documents that there shall be no violation of any Law of any
jurisdiction denying or restricting the right of banking corporations or associations to transact business as agent or trustee in such jurisdiction.
It is recognized that in case of litigation under this Agreement or any of the other Loan Documents, and in particular in case of the
enforcement of any of the Loan Documents, or in case the Administrative Agent deems that by reason of any present or future Law of any
jurisdiction it may not exercise any of the rights, powers or remedies granted herein or in any of the other Loan Documents or take any other
action which may be desirable or necessary in connection therewith, the Administrative Agent is hereby authorized to appoint an additional
individual or institution selected by the Administrative Agent in its sole discretion as a separate trustee, co-trustee, administrative agent,
collateral agent, administrative sub-agent or administrative co-agent (any such additional individual or institution being referred to herein
individually, as a “Supplemental Administrative Agent” and, collectively, as “Supplemental Administrative Agents”).
(b)
In the event that the Administrative Agent appoints a Supplemental Administrative Agent with respect to any
Collateral, (i) each and every right, power, privilege or duty expressed or intended by this Agreement or any of the other Loan Documents to
be exercised by or vested in or conveyed to the Administrative Agent with respect to such Collateral shall be exercisable by and vest in such
Supplemental Administrative Agent to the extent, and only to the extent, necessary to enable such Supplemental Administrative Agent to
exercise such rights, powers and privileges with respect to such Collateral and to perform such duties with respect to such Collateral, and
every covenant and obligation contained in the Loan Documents and necessary to the exercise or performance thereof by such Supplemental
Administrative Agent shall run to and be enforceable by either the Administrative Agent or such Supplemental Administrative Agent, and
(ii) the provisions of this Article IX, Section 10.04 and Section 10.05 that refer to the Administrative Agent shall inure to the benefit of such
Supplemental Administrative Agent and all references therein to the Administrative Agent shall be deemed to be references to the
Administrative Agent and/or such Supplemental Administrative Agent, as the context may require.
(c)
Should any instrument in writing from any Loan Party be required by any Supplemental Administrative Agent so
appointed by the Administrative Agent for more fully and certainly vesting in and confirming to him or it such rights, powers, privileges and
duties, the Borrower or Holdings, as applicable, shall, or shall cause such Loan Party to, execute, acknowledge and deliver any and all such
instruments promptly upon request by the Administrative Agent. In case any Supplemental Administrative Agent, or a successor thereto,
shall die, become incapable of acting, resign or be removed, all the rights, powers, privileges and duties of such Supplemental Administrative
Agent, to the extent permitted by Law, shall vest in and be exercised by the Administrative Agent until the appointment of a new
Supplemental Administrative Agent.
Section 9.13
Intercreditor Agreements
. Notwithstanding anything to the contrary set forth in any Loan Document, to the extent the Administrative Agent enters into any
Intercreditor Agreement, this Agreement will be subject to the terms and provisions of such Intercreditor Agreement. In the event of any
inconsistency between the provisions of this Agreement or any other Loan Document and any such Intercreditor Agreement, the provisions
of such Intercreditor Agreement govern and control. The Lenders acknowledge and agree that each Agent is (i) authorized and instructed to
enter into any Intercreditor Agreement to be executed on the Closing Date with respect to Indebtedness incurred on the Closing Date
pursuant to Section 7.03(b)(i)(A) and 7.03(b)(ii) and (ii) authorized to, and each Agent agrees that, with respect to any secured Indebtedness,
upon request by the Borrower, it shall, enter into an Intercreditor Agreement contemplated hereunder with respect to such Indebtedness with
the collateral agent or other Debt Representative of the holders of such Indebtedness that is secured by a Lien on Collateral the entering into
of
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which is expressly provided for (including with respect to priority) under this Agreement. The Lenders hereby authorize and instruct the
Administrative Agent to (a) enter into any such Intercreditor Agreement executed on the Closing Date or any such other Intercreditor
Agreement, (b) bind the Lenders on the terms set forth in any such Intercreditor Agreement and (c) perform and observe its obligations under
any such Intercreditor Agreement. The Agents and each Secured Party agree that the Agents shall be entitled to rely and shall rely
exclusively on an officer’s certificate of the Borrower in determining whether it is authorized or instructed to enter into an Intercreditor
Agreement pursuant to this Section. Each Secured Party covenants and agrees not to give the Collateral Agent or Administrative Agent any
instruction that is not consistent with the provisions of this Section 9.13. In furtherance of the foregoing, notwithstanding anything to the
contrary set forth herein, to the extent that any Loan Party is required to give physical possession or control over or with respect to any
Collateral to the Administrative Agent, the Collateral Agent, any other Agent or any Lender under this Agreement or any of the other Loan
Documents, such requirement to give possession or control shall be satisfied if such possession or control is given to a Debt Representative
for any Indebtedness that is secured by a Lien that is either pari passu or senior to the Liens on such Collateral securing the Obligations, in
each case, in accordance with the ABL Intercreditor Agreement, the Closing Date Equal Priority Intercreditor Agreement and any other
Intercreditor Agreement.
Section 9.14
Cash Management Agreements and Secured Hedge Agreements
. Except as otherwise expressly set forth herein or in any Guaranty or any Collateral Document, no Cash Management Bank or
Hedge Bank that obtains the benefits of Section 8.03, any Guaranty or any Collateral by virtue 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 or any Guaranty (including the release or impairment of any Collateral or
Guaranty) other than in its capacity as a Lender and, in such case, only to the extent expressly provided in the Loan Documents.
Notwithstanding any other provision of this Article IX to the contrary, the Administrative Agent shall not be required to verify the payment
of, or that other satisfactory arrangements have been made with respect to, Cash Management Obligations or Obligations arising under
Secured Hedge Agreements.
Section 9.15
Withholding Taxes
. To the extent required by any applicable Law, the Administrative Agent may withhold from any payment to any Lender an
amount equivalent to any applicable withholding tax. If any Governmental Authority asserts a claim that the Administrative Agent did not
properly withhold tax from amounts paid to or for the account of any Lender because the appropriate form was not delivered or was not
properly executed or because such Lender failed to notify the Administrative Agent of a change in circumstance which rendered the
exemption from, or reduction of, withholding tax ineffective or for any other reason, or if the Administrative Agent reasonably determines
that a payment was made to a Lender pursuant to this Agreement without deduction of applicable withholding tax from such payment, such
Lender shall indemnify the Administrative Agent fully for all amounts paid, directly or indirectly, by the Administrative Agent as Tax or
otherwise, including any penalties or interest and together with all expenses (including legal expenses, allocated internal costs and out-of-
pocket expenses) incurred.
Section 9.16
Certain ERISA Matters
.
(a) Each Lender (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from
the date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the
Administrative Agent and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that at least one of
the following is and will be true:
(i) such Lender is not using “plan assets” (within the meaning of Section 3(42) of ERISA or otherwise) of one or more Benefit
Plans with respect to such Lender’s entrance into, participation in, administration of and performance of the Loans, the
Commitments or this Agreement,
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(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84-14 (a class exemption for certain transactions
determined by independent qualified professional asset managers), PTE 95-60 (a class exemption for certain transactions
involving insurance company general accounts), PTE 90-1 (a class exemption for certain transactions involving insurance
company pooled separate accounts), PTE 91-38 (a class exemption for certain transactions involving bank collective investment
funds) or PTE 96-23 (a class exemption for certain transactions determined by in-house asset managers), is applicable with respect
to such Lender’s entrance into, participation in, administration of and performance of the Loans, the Commitments and this
Agreement,
(iii) (A) such Lender is an investment fund managed by a “Qualified Professional Asset Manager” (within the meaning of Part
VI of PTE 84-14), (B) such Qualified Professional Asset Manager made the investment decision on behalf of such Lender to enter
into, participate in, administer and perform the Loans, the Commitments and this Agreement, (C) the entrance into, participation
in, administration of and performance of the Loans, the Commitments and this Agreement satisfies the requirements of sub-
sections (b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such Lender, the requirements of subsection (a) of
Part I of PTE 84-14 are satisfied with respect to such Lender’s entrance into, participation in, administration of and performance
of the Loans, the Commitments and this Agreement, or
(iv) such other representation, warranty and covenant as may be agreed in writing between the Administrative Agent, in its sole
discretion, and such Lender.
(b) In addition, unless either (1) sub-clause (i) in the immediately preceding clause (a) is true with respect to a Lender or (2) a
Lender has provided another representation, warranty and covenant in accordance with sub-clause (iv) in the immediately preceding clause
(a), such Lender further (x) represents and warrants, as of the date such Person became a Lender party hereto, to, and (y) covenants, from the
date such Person became a Lender party hereto to the date such Person ceases being a Lender party hereto, for the benefit of, the
Administrative Agent and not, for the avoidance of doubt, to or for the benefit of the Borrower or any other Loan Party, that the
Administrative Agent is not a fiduciary with respect to the assets of such Lender involved in such Lender’s entrance into, participation in,
administration of and performance of the Loans, the Commitments and this Agreement (including in connection with the reservation or
exercise of any rights by the Administrative Agent under this Agreement, any Loan Document or any documents related hereto or thereto).
Section 10.01
Amendments, Waivers, Etc.
ARTICLE X.
MISCELLANEOUS
(a)
General Rule. Except as otherwise set forth in this Agreement, no amendment or waiver of any provision of this
Agreement or any other Loan Document, and no consent to any departure by the Borrower or any other Loan Party therefrom, shall be
effective unless in writing signed by the Required Lenders (or the Administrative Agent on behalf of the Required Lenders) and the Borrower
or the applicable Loan Party, as the case may be, and acknowledged by the Administrative Agent, and each such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which given.
(b)
consent shall:
Specific Lender Approvals. Notwithstanding the provisions of Section 10.01(a), no such amendment, waiver or
(i)
extend or increase the Commitment of any Lender, without the written consent of such Lender, it being
understood that the waiver of any condition precedent set forth in Section
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4.02 or the waiver of any Default, Event of Default, mandatory prepayment or mandatory reduction of the Commitments shall not
constitute an extension or increase of any Commitment of any Lender; or
(ii)
postpone any date scheduled for, or reduce the amount of, any payment of principal, interest or fees with
respect to any Loan without the written consent of each Lender entitled to such payment of principal, interest or fees it being
understood that (A) the waiver of (or amendment to the terms of) any mandatory prepayment of the Loans shall not constitute a
postponement of any date scheduled for the payment of principal, interest or fees and (B) a waiver of any condition precedent set
forth in Section 4.02 or a waiver of any Default (other than a Default under Section 8.01(a)) or mandatory reduction of the
Commitments shall not constitute a postponement of any date scheduled for, or a reduction in the amount of, any payment of
principal, interest or fees; or
(iii)
reduce the principal of, or the rate of interest specified herein on, any Loan or any fees or other amounts
payable hereunder or under any other Loan Document without the written consent of each Lender entitled to such principal,
interest or Person entitled to such fee or other amount, as applicable, it being understood that (A) any change to the definition of
First Lien Net Leverage Ratio or in the component definitions thereof shall not constitute a reduction in the rate of interest
specified herein or any fees or other amounts payable hereunder or under any other Loan Document and (B) only the consent of
the Required Lenders shall be necessary to amend the definition of “Default Rate” and with respect to any Facility, only the
consent of the Required Facility Lenders shall be necessary to waive any obligation of the Borrower to pay interest at the Default
Rate with respect to such Facility; or
(iv)
change (i) any provision of this Section 10.01 (except as expressly set forth herein) or the definition of
“Required Lenders,” “Required Facility Lenders” or “Pro Rata Share” or any other provision specifying the number of
Lenders or portion of the Loans or Commitments required to take any action under the Loan Documents, without the written
consent of each Lender or (ii) the definition of “Required Delayed Draw Lenders” without the consent of each Lender holding
Delayed Draw Commitments; or
(v)
other than in connection with a transfer or other transaction permitted (or not prohibited) under the Loan
Documents, release all or substantially all of the Collateral in any transaction or series of related transactions, without the written
consent of each Lender; or
(vi)
other than in connection with a transfer or other transaction permitted (or not prohibited) under the Loan
Documents, release all or substantially all of the aggregate value of the Guaranty or all or substantially all of the Guarantors,
without the written consent of each Lender; or
(vii)
modify Section 2.12 or Section 8.03, including in a manner that would by its terms alter the pro rata sharing
of payments required thereby, without the written consent of each Lender directly and adversely affected thereby; or
(viii)
prior to an Event of Default under Section 9.01(f), amend or modify any term or provision of any Loan
Document to permit the issuance or incurrence of any Indebtedness for borrowed money (including any exchange of existing
Indebtedness that results in another class of Indebtedness for borrowed money, but excluding any Capitalized Lease or purchase
money Indebtedness) with respect to which (i) such Indebtedness is proposed provided by one or more Lenders (or their Affiliates)
and (ii) either (x) such Indebtedness is secured by the Term Priority
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Collateral and in respect of which the Liens on the Term Priority Collateral securing the Obligations of any Class would be
contractually subordinated or (y) Obligations of any Class would be contractually subordinated in right of payment to such
Indebtedness (any such other Indebtedness to which such Liens securing any of the Obligations or such Obligations, as applicable,
are subordinated, “Senior Indebtedness”), in each case, without the written consent of each Lender of such Class directly and
adversely affected thereby, unless each adversely affected Lender has been offered a bona fide opportunity to fund or otherwise
provide its pro rata share (based on the amount of Obligations that are adversely affected thereby held by each Lender and the
portion of such Senior Indebtedness proposed to be provided by Lenders (or their Affiliates)) of the Senior Indebtedness on the
same terms (other than bona fide backstop fees on customary market terms and reimbursement of counsel fees and other expenses
in connection with the negotiation of the terms of such transaction; such fees and expenses, “Ancillary Fees”) as offered to all
other Lenders (or their Affiliates) providing the Senior Indebtedness and to the extent such adversely affected Lender decides to
participate in the Senior Indebtedness, receive its pro rata share of the fees and any other similar benefit (other than Ancillary
Fees) of the Senior Indebtedness afforded to the other Lenders (or any of their Affiliates) providing the Senior Indebtedness
pursuant to a written offer made to each such adversely affected Lender describing the material terms (other than Ancillary Fees)
of the arrangements pursuant to which the Senior Indebtedness is to be provided, which offer shall remain open to each adversely
affected Lender for a period of not less than five (5) Business Days (or such lesser time as reasonably agreed by the applicable
Lender with respect to itself).
(c)
Other Approval Requirements. Notwithstanding the provisions of Section 10.01(a) or Section 10.01(b);
(i)
no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent in addition
to the Lenders required above, adversely affect the rights or duties of, or any fees or other amounts payable to, the Administrative
Agent under this Agreement or any other Loan Document;
(ii)
no amendment, waiver or consent shall, unless in writing and signed by the Collateral Agent in addition to
the Lenders required above, adversely affect the rights or duties of, or any fees or other amounts payable to, the Collateral Agent
under this Agreement or any other Loan Document;
(iii)
Section 10.07(g) may not be amended, waived or otherwise modified without the consent of each Granting
Lender all or any part of whose Loans are being funded by an SPC at the time of such amendment, waiver or other modification;
and
(iv)
the consent of the Required Facility Lenders or Required Delayed Draw Lenders, as applicable, shall be
required with respect to any amendment that by its terms adversely affects the rights of Lenders under such Facility in respect of
payments hereunder in a manner different than such amendment affects other Facilities;
(v)
the consent of only the Required Delayed Draw Lenders shall be required to amend, waive or otherwise
modify any condition precedent set forth in Section 4.02 with respect to the making of Delayed Draw Term Loans; and
(vi)
this Agreement and the other Loan Documents may be amended (or amended and restated) to effect an
Incremental Amendment, Extension Amendment and/or Refinancing Amendment, in each case in accordance with the terms set
forth in this Agreement with respect thereto.
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(d)
Intercreditor Agreement. No Lender consent is required to effect any amendment or supplement to any Intercreditor
Agreement or any other intercreditor agreement that is,
(i)
for the purpose of adding the holders of Pari Passu Lien Debt, Junior Lien Debt, Incremental Equivalent Debt,
Permitted Pari Passu Secured Refinancing Debt or Permitted Junior Secured Refinancing Debt (or a Debt Representative with
respect to any Indebtedness with respect to which it is a representative or agent) as parties thereto, as expressly contemplated by
the terms of such intercreditor agreement (it being understood that any such amendment or supplement may make such other
changes to the applicable intercreditor agreement as, in the good faith determination of the Administrative Agent, are required to
effectuate the foregoing), or
(ii)
expressly contemplated by any such Intercreditor Agreement or any other intercreditor agreement;
(e)
Additional Facilities and Replacement Loans.
(i)
Additional Facilities. This Agreement may be amended (or amended and restated) with the written consent of
the Required Lenders, the Administrative Agent and the Borrower (I) to add one or more additional credit facilities to this
Agreement and to permit the extensions of credit from time to time outstanding thereunder and the accrued interest and fees in
respect thereof to share ratably in the benefits of this Agreement and the other Loan Documents with the Loans and the accrued
interest and fees in respect thereof and (II) to include appropriately the Lenders holding such credit facilities in any determination
of the Required Lenders.
(ii)
Replacement Loans. The Loan Documents may be amended with the written consent of the Borrower and
the Lenders providing Replacement Loans (as defined below) to permit the refinancing, replacement or exchange of all
outstanding Term Loans of any Class (“Refinanced Loans”) with replacement term loans (“Replacement Loans”) hereunder;
provided that,
(A)
the aggregate principal amount of such Replacement Loans shall not exceed the aggregate
principal amount of such Refinanced Loans (plus (1) the amount of all unpaid, accrued, or capitalized interest,
penalties, premiums (including tender premiums), and other amounts payable with respect to any such Refinanced
Loans and (2) underwriting discounts, fees, commissions, costs, expenses and other amounts payable with respect to
such Replacement Loans;
(B)
the Weighted Average Life to Maturity of such Replacement Loans shall not be shorter than the
remaining Weighted Average Life to Maturity of such Refinanced Loans at the time of such refinancing; and
(iii)
no amendment, modification or waiver of this Agreement or any Loan Document altering the ratable
treatment of Obligations arising under Secured Hedge Agreements or under Cash Management Obligations resulting in such
Obligations being junior in right of payment to principal on the Loans or resulting in Obligations owing to any Hedge Bank or any
Cash Management Obligations becoming unsecured (other than releases of Liens permitted in accordance with the terms hereof),
in each case in a manner materially adverse to any Hedge Bank or any Cash Management Bank, shall be effective without the
written consent of such Hedge Bank or such Cash Management Bank, as applicable.
(f)
LIBOR Replacement.
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(i)
Notwithstanding anything to the contrary herein or in any other Loan Document:
(A)
On March 5, 2021 the Financial Conduct Authority (“FCA”), the regulatory supervisor of USD
LIBOR’s administrator (“IBA”), announced in a public statement the future cessation or loss of representativeness of
overnight/Spot Next, 1-month, 3-month, 6-month and 12- month USD LIBOR tenor settings. On the earlier of (i) the
date that all Available Tenors of USD LIBOR have either permanently or indefinitely ceased to be provided by IBA or
have been announced by the FCA pursuant to public statement or publication of information to be no longer
representative and (ii) the Early Opt-in Effective Date, if the then-current Benchmark is USD LIBOR, the Benchmark
Replacement will replace such Benchmark for all purposes hereunder and under any Loan Document in respect of any
setting of such Benchmark on such day and all subsequent settings without any amendment to, or further action or
consent of any other party to this Agreement or any other Loan Document. If the Benchmark Replacement is Daily
Simple SOFR, all interest payments will be payable on a quarterly basis.
(B)
Upon the occurrence of a Benchmark Transition Event, the Benchmark Replacement will replace
the then-current Benchmark for all purposes hereunder and under any Loan Document in respect of any Benchmark
setting at or after 5:00 p.m. on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is
provided to the Lenders without any amendment to, or further action or consent of any other party to, this Agreement or
any other Loan Document so long as the Administrative Agent has not received, by such time, written notice of
objection to such Benchmark Replacement from Lenders comprising the Required Lenders. At any time that the
administrator of the then-current Benchmark has permanently or indefinitely ceased to provide such Benchmark or such
Benchmark has been announced by the regulatory supervisor for the administrator of such Benchmark pursuant to
public statement or publication of information to be no longer representative of the underlying market and economic
reality that such Benchmark is intended to measure and that representativeness will not be restored, the Borrower may
revoke any request for a borrowing of, conversion to or continuation of Loans to be made, converted or continued that
would bear interest by reference to such Benchmark until the Borrower’s receipt of notice from the Administrative
Agent that a Benchmark Replacement has replaced such Benchmark, and, failing that, the Borrower will be deemed to
have converted any such request into a request for a borrowing of or conversion to Base Rate Loans. During the period
referenced in the foregoing sentence, the component of the Base Rate based upon the Benchmark will not be used in
any determination of the Base Rate.
(C)
In connection with the implementation and administration of a Benchmark Replacement, the
Administrative Agent will have the right to make Benchmark Replacement Conforming Changes from time to time
and, notwithstanding anything to the contrary herein or in any other Loan Document, any amendments implementing
such Benchmark Replacement Conforming Changes will become effective without any further action or consent of any
other party to this Agreement.
(D)
The Administrative Agent will promptly notify the Borrower and the Lenders of (i) the
implementation of any Benchmark Replacement and (ii) the effectiveness of any Benchmark Replacement Conforming
Changes. Any determination, decision or election that may be made by the Administrative Agent or, if applicable, any
Lender (or group of Lenders) pursuant to this Section 10.01(f), including any determination with respect to a tenor, rate
or adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or
refrain from taking any action, will be
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conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from
any other party hereto, except, in each case, as expressly required pursuant to this Section 10.01(f).
(E)
At any time (including in connection with the implementation of a Benchmark Replacement), (i) if
the then-current Benchmark is a term rate (including Term SOFR or USD LIBOR), then the Administrative Agent may
remove any tenor of such Benchmark that is unavailable or non-representative for Benchmark (including Benchmark
Replacement) settings and (ii) the Administrative Agent may reinstate any such previously removed tenor for
Benchmark (including Benchmark Replacement) settings.
(g)
Defaulting Lenders and Disqualified Lenders. Notwithstanding any to the contrary here, no Defaulting Lender shall
have any right to approve or disapprove any amendment, waiver or consent hereunder (and any amendment, waiver or consent which by its
terms requires the consent of all Lenders, the Required Lenders, the Required Facility Lenders or each affected Lender may be effected with
the consent of the applicable Lenders other than Defaulting Lenders, Disqualified Lender or Net Short Lender), except that (A) the
Commitment of any Defaulting Lender may not be increased or extended without the consent of such Defaulting Lender and (B) any waiver,
amendment or modification requiring the consent of all Lenders or each affected Lender that by its terms affects any Defaulting Lender more
adversely than other affected Lenders shall require the consent of such Defaulting Lender. Disqualified Lenders and Net Short Lenders shall
be subject to the provisions of Section 10.27.
Section 10.02
Notices and Other Communications; Facsimile Copies
.
(a)
General. Except in the case of notices and other communications expressly permitted to be given by telephone (and
except as provided in Section 10.02(b)), all notices and other communications provided for herein shall be in writing and shall be delivered
by hand or overnight courier service, mailed by certified or registered mail or sent by fax as follows, and all notices and other
communications expressly permitted hereunder to be given by telephone shall be made to the applicable telephone number, as follows:
(i)
if to Holdings, the Borrower, the Collateral Agent or the Administrative Agent, to the address, fax number,
electronic mail address or telephone number specified for such Person on Schedule 10.02; and
(ii)
if to any other Lender, to the address, fax number, electronic mail addresses or telephone number specified in
its Administrative Questionnaire.
Notices and other communications sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to
have been given when received; notices and other communications sent by fax shall be deemed to have been given when sent (except that, if
not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next Business
Day for the recipient); and notices deposited in the United States mail with postage prepaid and properly addressed shall be deemed to have
been given within three Business Days of such deposit; provided that no notice to any Agent shall be effective until received by such Agent.
Notices and other communications delivered through electronic communications to the extent provided in Section 10.02(b) shall be effective
as provided in such subsection ((b)).
(b)
Electronic Communication. Notices and other communications to any Agent and the Lenders may be delivered or
furnished by electronic communication (including e-mail and Internet or intranet websites, including the Platform) pursuant to procedures
approved by the Administrative Agent (it being agreed that e-mail to the address(es) provided on Schedule 10.02 are approved by the
Administrative
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Agent); provided that the foregoing shall not apply to notices to any Agent, or Lender pursuant to Article II if such Person, as applicable, has
notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication. The
Administrative Agent or the Borrower may, in its discretion, agree to accept notices and other communications to it hereunder by electronic
communications pursuant to procedures approved by it; provided that approval of such procedures may be limited to particular notices or
communications.
(c)
Receipt. Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail
address shall be deemed 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 sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of
business on the next Business Day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be
deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of
notification that such notice or communication is available and identifying the website address therefor.
(d)
Risks of Electronic Communications. Each Loan Party understands that the distribution of materials through an
electronic medium is not necessarily secure and that there are confidentiality and other risks associated with such distribution and agrees and
assumes the risks associated with such electronic distribution, except to the extent caused by the bad faith, willful misconduct or gross
negligence of the Administrative Agent or any Lender as determined by a final, non-appealable judgment of a court of competent
jurisdiction.
(e)
The Platform. THE PLATFORM IS PROVIDED ‘AS IS’ AND ‘AS AVAILABLE.’ THE AGENT PARTIES (AS
DEFINED BELOW) DO NOT WARRANT THE ACCURACY OR COMPLETENESS OF THE BORROWER MATERIALS OR THE
ADEQUACY OF THE PLATFORM, AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS IN OR OMISSIONS FROM THE
BORROWER MATERIALS OR IN THE PLATFORM. NO WARRANTY OF ANY KIND, EXPRESS, IMPLIED OR STATUTORY,
INCLUDING ANY WARRANTY OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF
THIRD PARTY RIGHTS OR FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY ANY AGENT PARTY IN
CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM. In no event shall the Administrative Agent or any of its
Agent-Related Persons or any Lead Arranger (collectively, the “Agent Parties”) have any liability to Holdings, the Borrower, any Lender or
any other Person for losses, claims, damages, liabilities or expenses of any kind (whether in tort, contract or otherwise) arising out of the
Borrower’s or the Administrative Agent’s transmission of Borrower Materials through the Internet, except to the extent that such losses,
claims, damages, liabilities or expenses are determined by a court of competent jurisdiction by a final and non-appealable judgment to have
resulted from the gross negligence or willful misconduct of such Agent Party; provided however, that in no event shall any Agent Party have
any liability to Holdings, the Borrower, any Lender or any other Person for indirect, special, incidental, consequential or punitive damages
(as opposed to direct or actual damages). Each Loan Party, each Lender and each Agent agrees that the Administrative Agent may, but shall
not be obligated to, store any Borrower Materials on the Platform in accordance with the Administrative Agent’s customary document
retention procedures and policies.
(f)
Change of Address. Each of Holdings, the Borrower and the Administrative Agent may change its address, fax or
telephone number for notices and other communications hereunder by notice to the other parties hereto. Each other Lender may change its
address, fax or telephone number for notices and other communications hereunder by notice to the Borrower, the Administrative Agent and
the Collateral Agent. In addition, each Lender agrees to notify the Administrative Agent from time to time to ensure that
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the Administrative Agent has on record (i) an effective address, contact name, telephone number, fax number and electronic mail address to
which notices and other communications may be sent and (ii) accurate wire instructions for such Lender.
(g)
Reliance by the Administrative Agent and the Lenders. The Administrative Agent and the Lenders shall be entitled to
rely and act upon any notices (including Committed Loan Notices) purportedly given by or on behalf of the Borrower even if (i) such notices
were not made in a manner specified herein, were incomplete or were not preceded or followed by any other form of notice specified herein,
or (ii) the terms thereof, as understood by the recipient, varied from any confirmation thereof. All telephonic notices to and other telephonic
communications with the Administrative Agent may be recorded by the Administrative Agent, and each of the parties hereto hereby consents
to such recording. The Borrower shall indemnify the Administrative Agent and the Lenders and each Agent-Related Person 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 Borrower in
the absence of gross negligence, bad faith or willful misconduct as determined in a final and non-appealable judgment by a court of
competent jurisdiction.
(h)
Private-Side Information Contacts. Each Public Lender agrees to cause at least one individual at or on behalf of such
Public Lender to at all times have selected the “Private-Side Information” or similar designation on the content declaration screen of the
Platform in order to enable such Public Lender or its delegate, in accordance with such Public Lender’s compliance procedures and
applicable Law, including United States federal and state securities Laws, to make reference to information that is not made available through
the “Public-Side Information” portion of the Platform and that may contain Private-Side Information with respect to Holdings, its
Subsidiaries or their respective securities for purposes of United States federal or state securities laws. In the event that any Public Lender has
determined for itself to not access any information disclosed through the Platform or otherwise, such Public Lender acknowledges that
(i) other Lenders may have availed themselves of such information and (ii) neither the Borrower nor the Administrative Agent has (A) any
responsibility for such Public Lender’s decision to limit the scope of the information it has obtained in connection with this Agreement and
the other Loan Documents and (B) any duty to disclose such information to such Public Lender or to use such information on behalf of such
Public Lender, and shall not be liable for the failure to so disclose or use, such information.
Section 10.03
No Waiver; Cumulative Remedies
. No forbearance, failure or delay by any Lender or any Agent to exercise, and no delay by any such Person in exercising, any
right, remedy, power or privilege hereunder or under any other Loan Document shall impair such right, remedy, power or privilege or operate
as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided,
and provided under each other Loan Document, are cumulative and independent of any rights, remedies, powers and privileges provided by
Law.
Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and
remedies hereunder and under the other Loan Documents against the Borrower shall be vested exclusively in, and all actions and proceedings
at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent in accordance with
Article VIII for the benefit of all the Lenders; provided that the foregoing shall not prohibit (i) the Administrative Agent from exercising on
its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other
Loan Documents, (ii) [reserved] (iii) any Lender from exercising setoff rights in accordance with Section 10.09 (subject to the terms of
Section 2.12) or (iv) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a
proceeding relative to the Borrower under any Debtor Relief Law; provided further that if at any time there is no Person acting as
Administrative Agent hereunder and under the other Loan Documents, then (A) the Required Lenders shall have the rights otherwise
provided
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to the Administrative Agent pursuant to Article VIII and (B) in addition to the matters set forth in clauses (ii), (iii) and (iv) of the preceding
proviso and subject to Section 2.12, any Lender may, with the consent of the Required Lenders, enforce any rights or remedies available to it
and as authorized by the Required Lenders.
Section 10.04
Attorney Costs and Expenses
. The Borrower agrees (a) if the Closing Date occurs, to pay or reimburse the Administrative Agent, the Collateral Agent, the Lead
Arranger, the Supplemental Administrative Agents for all reasonable and documented in reasonable detail out-of-pocket expenses incurred
on or after the Closing Date in connection with the preparation, execution, delivery and administration of this Agreement and the other Loan
Documents and any amendment, waiver, consent or other modification of the provisions hereof and thereof (whether or not the transactions
contemplated thereby are consummated), limited, in the case of legal fees and expenses, to the Attorney Costs of one primary counsel and, if
reasonably necessary, one local counsel in each relevant jurisdiction material to the interests of the Lenders taken as a whole (which may be a
single local counsel acting in multiple material jurisdictions), and (b) to pay or reimburse the Administrative Agent, the Collateral Agent, the
Lead Arrangers, the Supplemental Administrative Agents and the Lenders for all reasonable and documented in reasonable detail out-of-
pocket costs and expenses incurred in connection with the enforcement of any rights or remedies under this Agreement or the other Loan
Documents (including all such costs and expenses incurred during any legal proceeding, including any proceeding under any Debtor Relief
Law, and including all Attorney Costs of one counsel to the Administrative Agent, the Collateral Agent, the Lead Arranger, the Supplemental
Administrative Agents and the Lenders taken as a whole (and, if reasonably necessary, one local counsel in any relevant material jurisdiction
(which may be a single local counsel acting in multiple material jurisdictions) and, solely in the event of an actual or potential conflict of
interest between the Administrative Agent, the Collateral Agent, the Lead Arrangers, the Supplemental Administrative Agents and the
Lenders, where the Person or Persons affected by such conflict of interest inform the Borrower in writing of such conflict of interest, one
additional counsel in each relevant material jurisdiction to each group of affected Persons similarly situated taken as a whole)). The
agreements in this Section 10.04 shall survive the termination of the Aggregate Commitments and repayment of all other Obligations. All
amounts due under this Section 10.04 shall be paid promptly following receipt by the Borrower of an invoice relating thereto setting forth
such expenses in reasonable detail. If any Loan Party fails to pay when due any costs, expenses or other amounts payable by it hereunder or
under any Loan Document, such amount may be paid on behalf of such Loan Party by the Administrative Agent in its sole discretion.
Expenses shall be deemed to be documented in reasonable detail only if they provide the detail required to enable the Borrower, acting in
good faith, to determine that such expenses relate to the activities with respect to which reimbursement is required hereunder. The Borrower
and each other Loan Party hereby acknowledge that the Administrative Agent and/or any Lender may receive a benefit, including a discount,
credit or other accommodation, from any of such counsel based on the fees such counsel may receive on account of their relationship with the
Administrative Agent and/or such Lender, including fees paid pursuant to this Agreement or any other Loan Document.
Section 10.05
Indemnification by the Borrower
. The Borrower shall indemnify and hold harmless the Administrative Agent, any Supplemental Administrative Agent, the
Collateral Agent, each Lender, each Lead Arranger, each Joint Bookrunner and their respective Affiliates, along with the branches, directors,
officers, directors, employees, agents, advisors, partners, shareholders, trustees, controlling persons, and other representatives of each of the
foregoing (collectively, the “Indemnitees”) from and against any and all liabilities, obligations, losses, damages, penalties, claims, demands,
actions, judgments, suits, costs, expenses and disbursements (including Attorney Costs) of any kind or nature whatsoever which may at any
time be imposed on, incurred by or asserted against any such Indemnitee in any way relating to or arising out of or in connection with (but
limited, in the case of legal fees and expenses, to the Attorney Costs of one counsel to all Indemnitees taken as a whole and, if reasonably
necessary, a single local counsel for all Indemnitees taken as a whole in each relevant jurisdiction that is material to the interest of such
Indemnitees (which may be a single local counsel acting in multiple material jurisdictions), and solely in the case of an actual or potential
conflict
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of interest between Indemnitees (where the Indemnitee affected by such conflict of interest informs the Borrower in writing of such conflict
of interest), one additional counsel in each relevant jurisdiction to each group of affected Indemnitees similarly situated taken as a whole),
(a)
the execution, delivery, enforcement, performance or administration of any Loan Document or any other agreement,
letter or instrument delivered in connection with the transactions contemplated thereby or the consummation of the transactions contemplated
thereby (including the reliance in good faith by any Indemnitee on any notice purportedly given by or on behalf of the Borrower or any Loan
Party),
(b)
(c)
the Transaction,
any Commitment, Loan or the use or proposed use of the proceeds therefrom,
(d)
any actual or alleged presence or release of, or exposure to, any Hazardous Materials on or from any property currently
or formerly owned or operated by the Borrower or any other Loan Party, or any Environmental Claim or Environmental Liability arising out
of the activities or operations of or otherwise related to the Borrower or any other Loan Party, or
(e)
any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based
on contract, tort or any other theory (including any investigation of, preparation for, or defense of any pending or threatened claim,
investigation, litigation or proceeding) and regardless of whether any Indemnitee is a party thereto;
(all the foregoing, collectively, the “Indemnified Liabilities”); provided that such indemnity shall not, as to any Indemnitee, be available to
the extent that a court of competent jurisdiction determines in a final and non-appealable judgment that any such liabilities, obligations,
losses, damages, penalties, claims, demands, actions, judgments, suits, costs, expenses or disbursements resulted from (i) the gross
negligence, bad faith or willful misconduct of such Indemnitee or of any Related Indemnified Person of such Indemnitee, (ii) a material
breach of any obligations of such Indemnitee under any Loan Document by such Indemnitee or Related Indemnified Person, or (iii) any
dispute solely among Indemnitees or of any Related Indemnified Person of such Indemnitee other than any claims against an Indemnitee in
its capacity or in fulfilling its role as the Administrative Agent, the Collateral Agent or a Lead Arranger (or other Agent role) under the
Facility and other than any claims arising out of any act or omission of the Borrower or any of its Affiliates. To the extent that the
undertakings to indemnify and hold harmless set forth in this Section 10.05 may be unenforceable in whole or in part because they are
violative of any applicable law or public policy, the Borrower shall contribute the maximum portion that it is permitted to pay and satisfy
under applicable law to the payment and satisfaction of all Indemnified Liabilities incurred by the Indemnitees or any of them. No
Indemnitee shall be liable for any damages arising from the use by others of any information or other materials obtained through Merrill
Datasite One, Intralinks/Intra Agency, Syndtrak or other similar information transmission systems in connection with this Agreement, except
to the extent resulting from the willful misconduct, bad faith or gross negligence of such Indemnitee or any Related Indemnified Person (as
determined by a final and non-appealable judgment of a court of competent jurisdiction), nor shall any Indemnitee or any Loan Party 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 in connection herewith or therewith (whether before or after the Closing Date) (other than, in the case of any Loan Party,
in respect of any such damages incurred or paid by an Indemnitee to a third party). In the case of an investigation, litigation or other
proceeding to which the indemnity in this Section 10.05 applies, such indemnity shall be effective whether or not such investigation,
litigation or proceeding is brought by any Loan Party, its directors, stockholders or creditors or an Indemnitee or any other Person, whether or
not any Indemnitee is otherwise a party thereto and whether or not any of the transactions contemplated hereunder or under any
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of the other Loan Documents is consummated. All amounts due under this Section 10.05 (after the determination of a court of competent
jurisdiction, if required pursuant to the terms of this Section 10.05) shall be paid within twenty Business Days after written demand therefor.
The agreements in this Section 10.05 shall survive the resignation of the Administrative Agent or the Collateral Agent, replacement of any
Lender, the termination of the Aggregate Commitments and the repayment, satisfaction or discharge of all the other Obligations. This
Section 10.05 shall not apply to Taxes, except it shall apply to any Taxes that represent losses, claims, damages, etc. arising from a non-Tax
claim (including a value added tax or similar tax charged with respect to the supply of legal or other services). For the avoidance of doubt
and without limiting the foregoing obligations in any manner, neither Jackson Wijaya, nor any other Affiliate of the Borrower (other than
Holdings, the Borrower, and its Restricted Subsidiaries) shall have any liability under this Section 10.05, and each is hereby released from
any liability arising from the Transactions or any other transaction explicitly permitted (or not prohibited) by the Loan Documents.
Section 10.06
Marshaling; Payments Set Aside
. None of the Administrative Agent, the Collateral Agent or any Lender shall be under any obligation to marshal any assets in
favor of the Loan Parties or any other Person or against or in payment of any or all of the Obligations. To the extent that any payment by or
on behalf of the Borrower is made to any Agent or any Lender (or to the Administrative Agent, on behalf of any Lender), or any Agent or
any Lender enforces any security interests or exercises its right of setoff, and such payments or the proceeds of such enforcement or setoff or
any part thereof are subsequently invalidated, declared to be fraudulent or preferential or a transfer at undervalue, set aside and/or required
(including pursuant to any settlement entered into by such Agent or such Lender in its discretion) to be repaid to a trustee, receiver, interim
receiver, receiver and manager, monitor or any other party, in connection with any proceeding under any Debtor Relief Law or otherwise,
then (a) to the extent of such recovery, the obligation or part thereof originally intended to be satisfied and all Liens, rights and remedies
therefor or related thereto, shall be revived and continued in full force and effect as if such payment or payments had not been made or such
enforcement or setoff had not occurred and (b) each Lender severally agrees to pay to the Administrative Agent upon demand its applicable
share (without duplication) of any amount so recovered from or repaid by the Administrative Agent, plus interest thereon from the date of
such demand to the date such payment is made at a rate per annum equal to the Federal Funds Rate from time to time in effect.
Section 10.07
Successors and Assigns
.
(a)
The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby, except that neither Holdings nor the Borrower may, except as permitted by Section 7.04
or Section 7.10(a)(i), assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the
Administrative Agent and each Lender and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except,
(i)
(ii)
(iii)
(iv)
to an assignee in accordance with the provisions of Section 10.07(b);
by way of participation in accordance with the provisions of Section 10.07(d) of this Section;
by way of pledge or assignment of a security interest subject to the restrictions of Section 10.07(f); or
to an SPC in accordance with the provisions of Section 10.07(g) (and any other attempted assignment or
transfer by any party hereto shall be null and void).
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Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto, their respective
successors and assigns permitted hereby, Participants to the extent provided in Section 10.07(d) and, to the extent expressly contemplated
hereby, the Agent-Related Persons of each of the Administrative Agent and the Lenders) any legal or equitable right, remedy or claim under
or by reason of this Agreement.
(b)
Assignments by Lenders. Any Lender may at any time assign to one or more assignees all or a portion of its rights and
obligations under this Agreement, including all or a portion of its Commitment and the Loans at the time owing to it; provided that any such
assignment shall be subject to the following conditions:
(i)
Minimum Amounts.
(A)
in the case of an assignment of the entire remaining amount of the assigning Lender’s Term Loans
at the time held by it, or in the case of an assignment to a Lender, an Affiliate or branch of a Lender or an Approved
Fund, no minimum amount need be assigned; and
(B)
with respect to any assignment not described in Section 10.07(b)(i)(A), such assignment shall be in
an aggregate amount of not less than with respect to the assigning Lender’s Term Loans, $1,000,000, unless in each
case, each of the Administrative Agent, and so long as no Specified Event of Default has occurred and is continuing at
the time of such assignment, the Borrower otherwise consents (such consent not to be unreasonably withheld or
delayed).
(ii)
Proportionate Amounts. Each partial assignment of Term Loans or Delayed Draw Commitments shall be
made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with
respect to the Term Loans or Delayed Draw Commitments assigned, except that this clause ((ii)) shall not prohibit any Lender
from assigning all or a portion of its rights and obligations among separate Facilities on a non-pro rata basis.
(iii)
Required Consents. No consent shall be required for any assignment, except to the extent required by
Section 10.07(b)(i)(B) and the following:
(A)
the consent of the Borrower (such consent not to be unreasonably withheld or delayed) shall be
required unless (1) a Specified Event of Default has occurred and is continuing at the time of such assignment or
(2) such assignment is made (a) with respect to Term Loans or Delayed Draw Commitments to a Lender, an Affiliate or
branch of a Lender or an Approved Fund; provided however, that the Borrower shall be deemed to have consented to
any assignment of Term Loans or Delayed Draw Commitments if the Borrower does not respond within five Business
Days of a written request for its consent with respect to such assignment; and
(B)
the consent of the Administrative Agent (such consent not to be unreasonably withheld or delayed)
shall be required if such assignment is to a Person that is not a Lender, an Affiliate or branch of such Lender or an
Approved Fund.
(iv)
Assignment and Assumption. The parties to each assignment shall execute and deliver to the Administrative
Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500; provided that (A) the
Administrative Agent may, in its sole discretion, elect to waive such processing and recordation fee in the case of any assignment
and
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(B) no processing and recordation fee shall be payable in connection with an assignments by or to a Lead Arranger or its Affiliates
or branches. The Eligible Assignee, if it is not a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire
and any tax forms required under Sections 3.01(b), ((c)), ((d)) and ((e)), as applicable. Upon receipt of the processing and
recordation fee and any written consent to assignment required by Section 10.07(b)(iii), the Administrative Agent shall promptly
accept such Assignment and Assumption and record the information contained therein in the Register.
(v)
No Assignments to Certain Persons. No such assignment shall be made,
(A)
to Holdings, the Borrower or any of the Borrower’s Restricted Subsidiaries except as permitted
under Section 2.04(a)(iv) or under Section 10.07(i);
(B)
Subsidiaries);
to any of the Borrower’s Affiliates (other than Holdings or any of the Borrower’s Restricted
(C)
to any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender
hereunder, would constitute any of the foregoing persons described in this clause;
(D)
to a natural person; or
(E)
or a Net Short Lender.
to a Disqualified Lender or a Net Short Lender or Lender who has become a Disqualified Lender
To the extent that any assignment is purported to be made to a Disqualified Lender or a Net Short Lender, such transaction shall be subject to
the applicable provisions of Section 10.27. Lenders shall be entitled to rely conclusively on any Net Short Representation made (or deemed
made) to it in any agreement or instrument documenting or otherwise evidencing such assignment and shall have no duty to inquire as to or
investigate the accuracy of any Net Short Representation therein or provided in connection with such assignment.
(vi)
Defaulting Lenders Assignments. In connection with any assignment of rights and obligations of any
Defaulting Lender hereunder, no such assignment shall be effective unless and until, in addition to the other conditions thereto set
forth herein, the parties to the assignment shall make such additional payments to the Administrative Agent in an aggregate
amount sufficient, upon distribution thereof as appropriate (which may be outright payment, purchases by the assignee of
participations or sub-participations, or other compensating actions, including funding, with the consent of the Borrower and the
Administrative Agent, the applicable Pro Rata Share of Loans previously requested but not funded by the Defaulting Lender, to
each of which the applicable assignee and assignor hereby irrevocably consent), to (A) pay and satisfy in full all payment
liabilities then owed by such Defaulting Lender to the Administrative Agent and each other Lender hereunder (and interest
accrued thereon), and (B) acquire (and fund as appropriate) its full Pro Rata Share of all Loans. Notwithstanding the foregoing, in
the event that any assignment of rights and obligations of any Defaulting Lender hereunder shall become effective under
applicable Law without compliance with the provisions of this paragraph, then the assignee of such interest shall be deemed to be
a Defaulting Lender for all purposes of this Agreement until such compliance occurs.
Subject to acceptance and recording thereof by the Administrative Agent pursuant to Section 10.07(c), from and after the effective date
specified in each Assignment and Assumption, the assignee thereunder shall be
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a party to this Agreement (except in the case of an assignment to or purchase by Holdings, the Borrower or any of Holdings’ Subsidiaries)
and, to the extent of the interest assigned by such Assignment and Assumption and as permitted by this Section 10.07, have the rights and
obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption
covering all of the assigning Lender’s rights and obligations 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 applicable Notes, the Borrower (at its
expense) shall execute and deliver a Note to the assignee Lender. Any assignment or transfer by a Lender of rights or obligations under this
Agreement that does not comply with this subsection shall be treated for purposes of this Agreement as a sale by such Lender of a
participation in such rights and obligations in accordance with Section 10.07(d).
(c)
Register. The Administrative Agent, acting solely for this purpose as a non-fiduciary agent of the Borrower (and such
agency being solely for Tax purposes), shall maintain at the Administrative Agent’s Office a copy of each Assignment and Assumption
delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts
and stated interest of the Loans owing to each Lender pursuant to the terms hereof from time to time (the “Register”). The entries in the
Register shall be conclusive absent manifest error, and the Borrower, the Agents and the Lenders shall treat each Person whose name is
recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the
contrary. The Register shall be available for inspection by the Borrower or any Lender (but only, in the case of a Lender at the Administrative
Agent’s Office and with respect to any entry relating to such Lender’s Commitments, Loans and other Obligations), at any reasonable time
and from time to time upon reasonable prior notice. This Section 10.07(c) and Section 2.10 shall be construed so that all Loans are at all
times maintained in “registered form” within the meaning of Sections 163(f), 871(h)(2) and 881(c)(2) of the Code and any related United
States Treasury regulations (or any other relevant or successor provisions of the Code or of such United States Treasury regulations).
(d)
Participations. Any Lender may at any time, without the consent of, or notice to, the Borrower, the Administrative
Agent or any other Person sell participations (a “Participation”) to any Person (other than to (1) a natural person, a Disqualified Lender or a
Net Short Lender, (2) the Borrower or any of the Borrower’s Affiliates or Subsidiaries or (3) any Person described in the proviso to the
definition of “Eligible Assignee”) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement
(including all or a portion of its Commitment and/or the Loans, and other Obligations owing to it); provided that (i) such Lender’s obligations
under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance
of such obligations and (iii) the Borrower, the Agents and the other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells
such a participation shall provide that such Lender shall retain the sole right to enforce this Agreement and the other Loan Documents and to
approve any amendment, modification or waiver of any provision of this Agreement or any other Loan Document; provided that such
agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, waiver or
other modification described in Section 10.01(b)(i) or Section 10.01(b)(ii) that directly and adversely affects such Participant. Subject to
Section 10.07(e), the Borrower agrees that each Participant shall be entitled to the benefits of Sections 3.01 (subject to the requirements of
Sections 3.01(b), ((c)), ((d)) and ((e)), as applicable (it being understood that the documentation required under such Sections shall be
delivered to the participating Lender)), 3.04 and 3.05 (through the applicable Lender) to the same extent as if it were a Lender and had
acquired its interest by assignment pursuant to Section 10.07(b). To the extent permitted by applicable Law, each Participant also
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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 2.12 as though it were a Lender. To the extent that any participation is purported to be made to a Disqualified Lender or a Net Short
Lender, such transaction shall be subject to the applicable provisions of Section 10.27. Lenders shall be entitled to rely conclusively on any
Net Short Representation made (or deemed made) to it in any agreement or instrument documenting or otherwise evidencing such
Participation and shall have no duty to inquire as to or investigate the accuracy of any Net Short Representation therein or provided in
connection with such Participation.
(e)
Limitations upon Participant Rights. A Participant shall not be entitled to receive any greater payment under
Section 3.01, 3.04 or 3.05 than the applicable Lender would have been entitled to receive with respect to the participation sold to such
Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent , such consent not to be
unreasonably withheld or delayed, or such entitlement to a greater payment results from a change in law that occurs after the Participant
acquired the participation. Each Lender that sells a participation or has a loan funded by an SPC shall (acting solely for this purpose as a
non-fiduciary agent of the Borrower) maintain a register complying with the requirements of Sections 163(f), 871(h) and 881(c)(2) of the
Code and the Treasury regulations (or any other relevant or successor provisions of the Code or of such United States Treasury regulations)
issued thereunder relating to the exemption from withholding for portfolio interest on which is entered the name and address of each
Participant or SPC and the principal amounts (and stated interest) of each Participant’s or SPC’s interest in the Loans or other obligations
under this Agreement (the “Participant Register”). A Lender shall not be obligated to disclose the Participant Register to any Person except
to the extent such disclosure is necessary to establish that any Loan or other obligation is in registered form under Section 5f.103-1(c) or
proposed Section 1.163-5(b) of the United States Treasury regulations (or any amended or successor version). The entries in the Participant
Register shall be conclusive absent manifest error, and such Lender shall treat each person whose name is recorded in the Participant Register
as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.
(f)
Liens on Loans. Any Lender may, at any time without the consent of the Borrower or the Administrative Agent, pledge
or assign a security interest in all or any portion of its rights under this Agreement (including under its Notes, if any) to secure obligations of
such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank or any other central bank; provided that no
such pledge or assignment shall release such Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such
Lender as a party hereto.
(g)
Special Purpose Funding Vehicles. Notwithstanding anything to the contrary contained herein, any Lender (a
“Granting Lender”) may grant to a special purpose funding vehicle identified as such in writing from time to time by the Granting Lender
to the Administrative Agent and the Borrower (an “SPC”) the option to provide all or any part of any Loan that such Granting Lender would
otherwise be obligated to make pursuant to this Agreement; provided that (i) nothing herein shall constitute a commitment by any SPC to
fund any Loan, and (ii) if an SPC elects not 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 Loan pursuant to the terms hereof. Each party hereto hereby agrees that (A) neither the grant to any
SPC nor the exercise by any SPC of such option shall increase the costs or expenses or otherwise increase or change the obligations of the
Borrower under this Agreement (including its obligations under Sections 3.01, 3.04 and 3.05), (B) no SPC shall be liable for any indemnity
or similar payment obligation under this Agreement for which a Lender would be liable, and (C) the Granting Lender shall for all purposes,
including the approval of any amendment, waiver or other modification of any provision of any Loan Document, remain the lender of record
hereunder. The making of a Loan by an SPC hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if,
such Loan were made by such Granting Lender. In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall
survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding
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commercial paper or other senior debt of any SPC, it will not institute against, or join any other Person in instituting against, such SPC any
bankruptcy, reorganization, arrangement, insolvency, receivership or liquidation proceeding under the laws of the United States or any State
thereof or any Debtor Relief Law or other applicable Law. Notwithstanding anything to the contrary contained herein, any SPC may (1) with
notice to, but without prior consent of the Borrower and the Administrative Agent and with the payment of a processing fee of $3,500 (which
processing fee may be waived by the Administrative Agent in its sole discretion), assign all or any portion of its right to receive payment
with respect to any Loan to the Granting Lender and (2) disclose on a confidential basis any non-public information relating to its funding of
Loans to any rating agency, commercial paper dealer or provider of any surety or Guarantee or credit or liquidity enhancement to such SPC.
(h)
Fronted Delayed Draw Term Loans. Notwithstanding anything herein to the contrary, assignments pursuant to and in
accordance with Section 2.03(b) shall be permitted and shall not be subject to any of the restrictions set forth in this Section 10.07.
(i)
Assignments to Borrower, etc.
(i)
Any Lender may, so long as no Event of Default has occurred and is continuing or would result therefrom,
assign all or a portion of its rights and obligations with respect to the Term Loans and the Term Loan Commitments under this
Agreement to Holdings, the Borrower or any of its Subsidiaries through (i) Dutch auctions open to all Lenders in accordance with
the procedures set forth on Exhibit L or (ii) open market purchase on a non-pro rata basis, in each case subject to the following
limitations; provided that:
(A)
if the assignee is Holdings or a Restricted Subsidiary of the Borrower, upon such assignment,
transfer or contribution, the applicable assignee shall automatically be deemed to have contributed or transferred the
principal amount of such Term Loans, plus all accrued and unpaid interest thereon, to the Borrower; or
(B)
if the assignee is the Borrower (including through contribution or transfers set forth in clause ((A))
above), (1) the principal amount of such Term Loans, along with all accrued and unpaid interest thereon, so contributed,
assigned or transferred to the Borrower shall be deemed automatically cancelled and extinguished on the date of such
contribution, assignment or transfer and (2) the Borrower shall promptly provide notice to the Administrative Agent of
such contribution, assignment or transfer of such Term Loans, and the Administrative Agent, upon receipt of such
notice, shall reflect the cancellation of the applicable Term Loans in the Register; and
(C)
no proceeds of any loans under the ABL Credit Facility shall be used to finance any such purchase
and assignment.
(ii)
[Reserved].
Section 10.08
Confidentiality
. Each of the Administrative Agent, the Collateral Agent, the Lead Arranger and the Lenders agrees to maintain the confidentiality
of the Information in accordance with its customary procedures (as set forth below), except that Information may be disclosed,
(a)
to its Affiliates and branches and to its and its Affiliates’ and branches’ respective partners, directors, officers,
employees, agents, trustees, advisors and representatives (it being understood that the Persons to whom such disclosure is made will be
informed of the confidential nature of such Information and instructed to keep such Information confidential and in no event shall such
disclosure be made to any
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Disqualified Lender or a Net Short Lender (other than a Net Short Lender (x) that provides a Net Short Representation at the time of such
disclosure or (y) as to which the disclosing party does not have actual knowledge that such Person is a Net Short Lender) pursuant to this
clause ((a)) but, in the case of any Disqualified Lender, only to the extent that a list of such Disqualified Lenders is available to all Lenders
upon request);
(b)
to the extent requested by any regulatory authority purporting to have jurisdiction over it (including the Federal
Reserve Bank or any other central bank or any self-regulatory authority, such as the National Association of Insurance Commissioners);
(c)
to the extent required by applicable laws or regulations or by any subpoena or similar legal process, provided that the
Administrative Agent, the Collateral Agent, such Lead Arranger or such Lender, as applicable, agrees that it will notify the Borrower as soon
as practicable in the event of any such disclosure by such Person (other than at the request of a regulatory authority) unless such notification
is prohibited by law, rule or regulation;
(d)
to any other party hereto (it being understood that in no event shall such disclosure be made to any Disqualified Lender
or a Net Short Lender (other than a Net Short Lender (x) that provides a Net Short Representation at the time of such disclosure or (y) as to
which the disclosing party does not have actual knowledge that such Person is a Net Short Lender) pursuant to this clause ((d)) but, in the
case of a Disqualified Lender, only to the extent the list of such Disqualified Lenders is available to all Lenders upon request);
(e)
in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or
proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder;
(f)
subject to an agreement containing provisions at least as restrictive as those of this Section 10.08 (it being understood
that in no event shall such disclosure be made to any Disqualified Lender or Net Short Lender (other than a Net Short Lender (x) that
provides a Net Short Representation at the time of such disclosure or (y) as to which the disclosing party does not have actual knowledge that
such Person is a Net Short Lender) pursuant to this clause ((f)) but, in the case of a Disqualified Lender, only to the extent that a list of such
Disqualified Lenders is available to all Lenders upon request), to (i) any bona fide assignee of or Participant in, or any prospective assignee
of or Participant in, any of its rights or obligations under this Agreement or any Eligible Assignee invited to be an Additional Lender or
(ii) any actual or prospective direct or indirect counterparty (or its advisors) to any swap or derivative transaction relating to the Borrower or
any of its Subsidiaries or any of their respective obligations;
(g)
(h)
with the prior written consent of the Borrower;
to any rating agency when required by it (it being understood that, prior to any such disclosure, such rating agency shall
undertake to preserve the confidentiality of any Information relating to the Loan Parties received by it from such Lender); or
(i)
to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section 10.08 or
(ii) becomes available to the Administrative Agent, the Collateral Agent, any Lead Arranger, any Lender or any of their respective Affiliates
or branches on a non-confidential basis from a source other than Holdings, the Borrower or any Subsidiary thereof, and which source is not
known by such Person to be subject to a confidentiality restriction in respect thereof in favor of the Borrower or any Affiliate of the
Borrower.
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In addition, each of the Administrative Agent, the Collateral Agent, the Lead Arranger and the Lenders may disclose the existence of this
Agreement and the information about this Agreement to the CUSIP Service Bureau or any similar agency in connection with the issuance
and monitoring of CUSIP numbers with respect to the Loans, market data collectors, similar service providers to the lending industry, and
service providers to the Administrative Agent, the Collateral Agent, the Lead Arranger and the Lenders in connection with the administration
and management of this Agreement and the other Loan Documents.
For purposes of this Section 10.08, “Information” means all information received from or on behalf of any Loan Party or any
Subsidiary thereof relating to any Loan Party or any Subsidiary thereof or their respective businesses, other than any such information that is
available to the Administrative Agent, the Collateral Agent or any Lender on a non-confidential basis prior to disclosure by any Loan Party
or any Subsidiary thereof; it being understood that all information received from Holdings, the Borrower or any Subsidiary after the date
hereof shall be deemed confidential unless such information is clearly identified at the time of delivery as not being confidential. Any Person
required to maintain the confidentiality of Information as provided in this Section shall be considered to have complied with its obligation to
do so in accordance with its customary procedures if such Person has exercised the same degree of care to maintain the confidentiality of
such Information as such Person would accord to its own confidential information.
Each of the Administrative Agent, the Collateral Agent, the Lead Arranger and the Lenders acknowledges that (A) the Information
may include Private-Side Information concerning Holdings, the Borrower or a Subsidiary, as the case may be, (B) it has developed
compliance procedures regarding the use of Private-Side Information and (C) it will handle such Private-Side Information in accordance with
applicable Law, including United States Federal and state securities Laws.
Notwithstanding anything to the contrary therein, nothing in any Loan Document shall require Holdings or any of its subsidiaries
to provide information (i) that constitutes non-financial trade secrets or non-financial proprietary information, (ii) in respect of which
disclosure is prohibited by applicable Law, (iii) that is subject to attorney client or similar privilege or constitutes attorney work product or
(iv) the disclosure of which is restricted by binding agreements not entered into primarily for the purpose of qualifying for the exclusion in
this clause (iv).
Section 10.09
Set-off
. If an Event of Default shall have occurred and be continuing and each Lender and each of their respective Affiliates and branches
is hereby authorized at any time and from time to time, after obtaining the prior written consent of the Administrative Agent, without notice
to any Loan Party or to any other Person (other than the Administrative Agent), any such notice being hereby expressly waived, to the fullest
extent permitted by applicable law, to set off and apply any and all deposits (general or special, time or demand, provisional or final, in
whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender or any such Affiliate or
branch to or for the credit or the account of the Borrower or any other Loan Party against any and all of the obligations of the Borrower or
such Loan Party now or hereafter existing under this Agreement or any other Loan Document to such Lender, irrespective of whether or not
(a) such Lender shall have made any demand under this Agreement or any other Loan Document and (b) the principal of or the interest on the
Loans or any other amounts due hereunder shall have become due and payable pursuant to Article II and although such obligations of the
Borrower or such Loan Party may be contingent or unmatured or are owed to a branch or office of such Lender different from the branch or
office holding such deposit or obligated on such indebtedness; provided that in the event that any Defaulting Lender shall exercise any such
right of setoff, (i) all amounts so set off shall be paid over immediately to the Administrative Agent for further application in accordance with
the provisions of Sections 2.12 and 2.16 and, pending such payment, shall be segregated by such Defaulting Lender from its other funds and
deemed held in trust for the benefit of the Administrative Agent and the Lenders, and (ii) the Defaulting Lender shall provide promptly to the
Administrative Agent a statement describing in reasonable detail the Obligations owing to such Defaulting Lender as to which it exercised
such right of setoff. The rights
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of each Lender and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of set-off)
that such Lender or Affiliates or branches may have. Each Lender agrees to notify the Borrower and the Administrative Agent promptly after
any such set-off and application, provided that the failure to give such notice shall not affect the validity of such set-off and application.
Section 10.10
Interest Rate Limitation
. Notwithstanding anything to the contrary contained in any Loan Document, the interest paid or agreed to be paid under the Loan
Documents with respect to any of the Obligations, 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 interest
shall be applied to the principal of the Loans or, if it exceeds such unpaid principal, refunded to the Borrower. In determining whether the
interest contracted for, charged, or received by an Agent or a Lender exceeds the Maximum Rate, such Person may, to the extent permitted by
applicable Law, (a) characterize any payment that is not principal as an expense, fee, or premium rather than interest, (b) exclude voluntary
prepayments and the effects thereof, and (c) amortize, prorate, allocate, and spread in equal or unequal parts the total amount of interest
throughout the contemplated term of the Obligations hereunder. If the rate of interest under this Agreement at any time exceeds the
Maximum Rate, the outstanding amount of the Loans made hereunder shall bear interest at the Maximum Rate until the total amount of
interest due hereunder equals the amount of interest which would have been due hereunder if the stated rates of interest set forth in this
Agreement had at all times been in effect. In addition, if when the Loans made hereunder are repaid in full the total interest due hereunder
(taking into account the increase provided for above) is less than the total amount of interest which would have been due hereunder if the
stated rates of interest set forth in this Agreement had at all times been in effect, then to the extent permitted by law, the Borrower shall pay to
the Administrative Agent an amount equal to the difference between the amount of interest paid and the amount of interest which would have
been paid if the Maximum Rate had at all times been in effect. Notwithstanding the foregoing, it is the intention of the Lenders and the
Borrower to conform strictly to any applicable usury laws.
Section 10.11
Counterparts; Integration; Effectiveness
. This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall
constitute an original, but all of which when taken together shall constitute a single contract. This Agreement and the other Loan Documents
constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and
understandings, oral or written, relating to the subject matter hereof. Delivery of an executed counterpart of a signature page of this
Agreement by telecopy or other electronic imaging (including in .pdf or .tif format) means shall be effective as delivery of a manually
executed counterpart of this Agreement.
Section 10.12
Electronic Execution of Assignments and Certain Other Documents
. The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption, in or related to this
Agreement or any other document to be signed in connection with this Agreement and the transactions contemplated hereby or in any
amendment or other modification hereof (including waivers and consents) shall be deemed to include electronic signatures or the keeping of
records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the
use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Law, including the Federal
Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar
state laws based on the Uniform Electronic Transactions Act; provided that notwithstanding anything contained herein to the contrary, the
Administrative Agent is under no obligation to agree to accept electronic signatures in any form or any format unless expressly agreed to by
the Administrative Agent pursuant to procedures approved by it.
Section 10.13
Survival
. All representations and warranties made hereunder and in any other Loan Document or other document delivered pursuant hereto
or thereto or in connection herewith or therewith shall
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survive the execution and delivery hereof and thereof. Such representations and warranties have been or will be relied upon by the
Administrative Agent and each Lender, regardless of any investigation made by the Administrative Agent or any Lender or on their behalf
and notwithstanding that the Administrative Agent or any Lender may have had notice or knowledge of any Default at the time of any
Borrowing, and shall continue in full force and effect as long as any Loan or any other Obligation hereunder shall remain unpaid or
unsatisfied. Notwithstanding anything herein or implied by law to the contrary, the agreements of each Loan Party set forth in Sections 3.01,
3.04, 3.05, 10.04, 10.05 and 10.09 and the agreements of the Lenders set forth in Sections 2.12, 9.03 and 9.07 shall survive the satisfaction of
the Termination Conditions, and the termination hereof.
Section 10.14
Severability
. If any provision of this Agreement or the other Loan Documents is held to be illegal, invalid or unenforceable in any jurisdiction,
(a) the legality, validity and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other
jurisdiction, of this Agreement and the other Loan Documents shall not be affected or impaired thereby and (b) the parties shall endeavor in
good faith negotiations to replace the illegal, invalid or unenforceable provisions with valid provisions the economic effect of which comes
as close as possible to that of the illegal, invalid or unenforceable provisions. The invalidity of a provision in a particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction. Without limiting the foregoing provisions of this Section 10.14, if
and to the extent that the enforceability of any provisions in this Agreement relating to Defaulting Lenders shall be limited by Debtor Relief
Laws, as determined in good faith by the Administrative Agent, then such provisions shall be deemed to be in effect only to the extent not so
limited.
Section 10.15
GOVERNING LAW
.
(a)
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER (INCLUDING
ANY CLAIMS SOUNDING IN CONTRACT LAW OR TORT LAW ARISING OUT OF THE SUBJECT MATTER HEREOF AND ANY
DETERMINATIONS WITH RESPECT TO POST-JUDGMENT INTEREST) AND EACH OTHER LOAN DOCUMENT SHALL BE
GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK; provided that (i) the interpretation of the definition of “Material Adverse Effect” (as defined in the Acquisition Agreement) and
whether or not such a “Material Adverse Effect” (as defined in the Acquisition Agreement) has occurred for purposes of Section 4.01, (ii) the
determination of the accuracy of any Acquisition Agreement Representations and whether as a result of any inaccuracy of any Acquisition
Agreement Representation there has been a failure of a condition precedent set forth in Section 4.01 and (iii) the determination of whether the
Acquisition has been consummated in accordance with the terms of the Acquisition Agreement will, in each case, be governed by, and
construed and interpreted in accordance with, the laws of the State of Delaware as applied to the Acquisition Agreement, without giving
effect to any choice or conflict of law provision or rule that would cause the application of the laws of any other jurisdiction.
ITS APPOINTMENT
BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH PARTY HERETO (AND BY ITS
(b)
ACCEPTANCE OF
IRREVOCABLY AND
IN SUCH CAPACITY, EACH LEAD ARRANGER)
UNCONDITIONALLY SUBMITS, FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION AND VENUE OF THE
COURTS OF THE STATE OF NEW YORK SITTING IN NEW YORK CITY IN THE BOROUGH OF MANHATTAN AND OF ANY
UNITED STATES FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN, AND ANY APPELLATE COURT FROM ANY
THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT (OTHER THAN WITH RESPECT TO ACTIONS BY ANY AGENT IN RESPECT OF RIGHTS UNDER ANY
COLLATERAL DOCUMENT OR ANY OTHER LOAN DOCUMENT GOVERNED BY A LAW OTHER THAN THE LAWS OF THE
STATE OF NEW YORK OR WITH RESPECT TO ANY
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COLLATERAL SUBJECT THERETO), OR FOR RECOGNITION OR ENFORCEMENT OF ANY JUDGMENT, AND EACH OF THE
PARTIES HERETO (AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER)
IRREVOCABLY AND UNCONDITIONALLY AGREES THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, IN SUCH FEDERAL COURT. EACH OF THE PARTIES HERETO (AND BY ITS
ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER) AGREES THAT A FINAL JUDGMENT IN
ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY
SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW. EACH PARTY HERETO (AND BY ITS
ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER) AGREES THAT THE AGENTS AND
LENDERS RETAIN THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING
PROCEEDINGS AGAINST ANY LOAN PARTY IN THE COURTS OF ANY OTHER JURISDICTION IN CONNECTION WITH THE
EXERCISE OF ANY RIGHTS UNDER THIS AGREEMENT, ANY COLLATERAL DOCUMENT OR ANY OTHER LOAN
DOCUMENT OR THE ENFORCEMENT OF ANY JUDGMENT.
(c)
EACH LOAN PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT
PERMITTED BY APPLICABLE LAW, ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT IN ANY COURT REFERRED TO IN PARAGRAPH ((b)) OF THIS SECTION. EACH OF THE PARTIES HERETO (AND
BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER) HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO
THE MAINTENANCE OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
Section 10.16
WAIVER OF RIGHT TO TRIAL BY JURY
. EACH PARTY HERETO (AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD
ARRANGER) HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR
RELATING TO THIS AGREEMENT OR ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY
OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). THE SCOPE OF THIS WAIVER IS
INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT
RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF
DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY HERETO (AND BY ITS
ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER) (A) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PERSON HAS REPRESENTED, EXPRESSLY OR OTHERWISE,
THAT SUCH OTHER PERSON WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER
AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION, THAT EACH HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS
AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAVIER IN ITS RELATED FUTURE DEALINGS. EACH
PARTY HERETO (AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD ARRANGER)
FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT
IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL
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RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY
NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY
REFERRING TO THIS SECTION 10.16 AND EXECUTED BY EACH OF THE PARTIES HERETO AND THE LEAD ARRANGERS),
AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS
HERETO OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO
THE LOANS MADE HEREUNDER. IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN
CONSENT TO A TRIAL BY THE COURT.
Section 10.17
Limitation of Liability
. The Loan Parties agree that no Indemnitee shall have any liability (whether in contract, tort or otherwise) to any Loan Party or
any of their respective Subsidiaries or any of their respective equity holders or creditors for or in connection with the transactions
contemplated hereby and in the other Loan Documents, except to the extent such liability is determined in a final non-appealable judgment
by a court of competent jurisdiction to have resulted from such Indemnitee’s gross negligence or willful misconduct or bad faith or material
breach by such Indemnitee of its obligations under this Agreement. In no event, shall any party hereto, any Loan Party or any Indemnitee be
liable on any theory of liability for any special, indirect, consequential or punitive damages (including any loss of profits, business or
anticipated savings) (other than, in the case of the Borrower, in respect of any such damages incurred or paid by an Indemnitee to a third
party). Each party hereto (and by its acceptance of its appointment in such capacity, each Lead Arranger) hereby waives, releases and agrees
(each for itself and on behalf of its Subsidiaries) not to sue upon any such claim for any special, indirect, consequential or punitive damages,
whether or not accrued and whether or not known or suspected to exist in its favor.
Section 10.18
Use of Name, Logo, Etc.
Each Loan Party consents to the publication in the ordinary course by the Administrative Agent or any Lead Arranger of
customary advertising material relating to the financing transactions contemplated by this Agreement using such Loan Party’s name, product
photographs, logo or trademark; provided that any such trademarks or logos are used solely in a manner that is not intended to or reasonably
likely to harm or disparage the Borrower or any of its Subsidiaries or the reputation or goodwill of any of them. Such consent shall remain
effective until revoked by such Loan Party in writing to the Administrative Agent and such Lead Arranger, as applicable.
Section 10.19
USA PATRIOT Act Notice
. Each Lender that is subject to the USA PATRIOT Act and the Administrative Agent (for itself and not on behalf of any Lender)
hereby notifies each Loan Party 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 and address of each Loan Party and other information that
will allow such Lender or the Administrative Agent, as applicable, to identify each Loan Party in accordance with the USA PATRIOT Act.
Each Loan Party shall, promptly following a request by the Administrative Agent or any Lender, provide all documentation and other
information that the Administrative Agent or such Lender requests in order to comply with its ongoing obligations under applicable “know
your customer” and anti-money laundering rules and regulations, including the USA PATRIOT Act.
Section 10.20
Service of Process
. EACH PARTY HERETO (AND BY ITS ACCEPTANCE OF ITS APPOINTMENT IN SUCH CAPACITY, EACH LEAD
ARRANGER) IRREVOCABLY CONSENTS TO SERVICE OF PROCESS IN THE MANNER PROVIDED FOR NOTICES IN
SECTION 10.02. NOTHING IN THIS AGREEMENT WILL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY APPLICABLE LAW.
Section 10.21
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 Party acknowledges and agrees, and acknowledges its
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Affiliates’ understanding that: (a) (i) the transactions contemplated by the Loan Documents (including the exercise of rights and remedies
hereunder and thereunder) are arm’s-length commercial transactions between the Agents, the Lenders and the Lead Arrangers on the one
hand, and the Loan Parties and their Affiliates, on the other hand, (ii) each of the Loan Parties has consulted its own legal, accounting,
regulatory and tax advisors to the extent it has deemed appropriate, and (iii) each of the Loan Parties is capable of evaluating, and
understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (b) (i) the
Agents and the Lead Arrangers are and have been, and each Lender is and has been, acting solely as a principal and, except as expressly
agreed in writing by the relevant parties, have or has not been, are or is not, and will not be acting as an advisor, agent or fiduciary for the
Loan Parties, its stockholders or its Affiliates (irrespective of whether any Lender has advised, is currently advising or will advise any Loan
Party, its stockholders or its Affiliates on other matters), or any other Person and (ii) none of the Agents, the Lead Arrangers nor any Lender
has any obligation to the Borrower, Holdings or any of their respective Affiliates with respect to the transactions contemplated hereby except
those obligations expressly set forth herein and in the other Loan Documents; and (c) the Agents, the Lead Arrangers, the Lenders and their
respective Affiliates and branches may be engaged in a broad range of transactions that involve economic interests that conflict with those of
the Loan Parties, their stockholders and/or their affiliates, and none of the Agents, the Lead Arrangers nor any Lender has any obligation to
disclose any of such interests to the Borrower, Holdings or any of their respective Affiliates. Each Loan Party agrees that nothing in the Loan
Documents or otherwise will be deemed to create an advisory, fiduciary or agency relationship or fiduciary or other implied duty between
any Lender, on the one hand, and such Loan Party, its stockholders or its affiliates, on the other. To the fullest extent permitted by law, each
Loan Party hereby waives and releases any claims that it may have against the Agents, the Lead Arrangers or any Lender with respect to any
breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.
Section 10.22
Binding Effect
. This Agreement shall become effective when it shall have been executed by the Borrower, Holdings and the Administrative
Agent and the Administrative Agent shall have been notified by each Lender that each such Lender has executed it and thereafter shall be
binding upon and inure to the benefit of the Borrower, Holdings, each Agent, each Lender and their respective successors and assigns.
Section 10.23
Obligations Several; Independent Nature of Lender’s Rights
. The obligations of the Lenders hereunder are several and no Lender shall be responsible for the obligations or Commitments of
any other Lender hereunder. Nothing contained herein or in any other Loan Document, and no action taken by the Lenders pursuant hereto or
thereto, shall be deemed to constitute the Lenders as a partnership, an association, a joint venture or any other kind of entity. The amounts
payable at any time hereunder to each Lender shall be a separate and independent debt, and each Lender shall be entitled to protect and
enforce its rights arising out hereof and it shall not be necessary for any other Lender to be joined as an additional party in any proceeding for
such purpose.
Section 10.24
Headings
. Section headings herein are included herein for convenience of reference only and shall not constitute a part hereof for any other
purpose or be given any substantive effect.
Section 10.25
Acknowledgement and Consent to Bail-In of Affected Financial Institutions
.
Notwithstanding anything to the contrary in any Loan Document or in any other agreement, arrangement or understanding among
any such parties, each party hereto acknowledges that any liability of any Lender that is an Affected Financial Institution arising under any
Loan Document, to the extent such liability is unsecured, may be subject to the write-down and conversion powers of the applicable
Resolution Authority and agrees and consents to, and acknowledges and agrees to be bound by:
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(a)
the application of any Write-Down and Conversion Powers by the applicable Resolution Authority to any such
liabilities arising hereunder which may be payable to it by any Lender that is an Affected 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 or cancellation of any such liability;
(ii)
a conversion of all, or a portion of, such liability into shares or other instruments of ownership in such
Affected Financial Institution, its parent undertaking, or a bridge institution that may be issued to it or otherwise conferred on it,
and that such shares or other instruments of ownership will be accepted by it in lieu of any rights with respect to any such liability
under this Agreement or any other Loan Document; or
(iii)
the variation of the terms of such liability in connection with the exercise of the write-down and conversion
powers of the applicable Resolution Authority.
Section 10.26
Acknowledgment Regarding Any Supported QFCs
.
(a)
To the extent that the Loan Documents provide support, through a guarantee or otherwise (including the Guaranty), for
any Hedge Agreement or any other agreement or instrument that is a QFC (such support, “QFC Credit Support”, and each such QFC, a
“Supported QFC”), the parties acknowledge and agree as follows with respect to the resolution power of the Federal Deposit Insurance
Corporation under the Federal Deposit Insurance Act and Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act
(together with the regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in respect of such Supported QFC and QFC
Credit Support (with the provisions below applicable notwithstanding that the Loan Documents and any Supported QFC may in fact be stated
to be governed by the laws of the State of New York and/or of the United States or any other state of the United States).
(b)
In the event a Covered Entity that is party to a Supported QFC (each, a “Covered Party”) becomes subject to a
proceeding under a U.S. Special Resolution Regime, the transfer of such Supported QFC and the benefit of such QFC Credit Support (and
any interest and obligation in or under such Supported QFC and such QFC Credit Support, and any rights in property securing such
Supported QFC or such QFC Credit Support) from such Covered Party will be effective to the same extent as the transfer would be effective
under the U.S. Special Resolution Regime if the Supported QFC and such QFC Credit Support (and any such interest, obligation and rights in
property) were governed by the laws of the United States or a state of the United States. In the event a Covered Party or a BHC Act Affiliate
of a Covered Party becomes subject to a proceeding under a U.S. Special Resolution Regime, Default Rights under the Loan Documents that
might otherwise apply to such Supported QFC or any QFC Credit Support that may be exercised against such Covered Party are permitted to
be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if the Supported
QFC and the Loan Documents were governed by the laws of the United States or a state of the United States. Without limitation of the
foregoing, it is understood and agreed that rights and remedies of the parties with respect to a Defaulting Lender shall in no event affect the
rights of any Covered Party with respect to a Supported QFC or any QFC Credit Support.
Section 10.27
Disqualified Lenders and Net Short Positions
.
(a)
Replacement of Disqualified Lenders.
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(i)
To the extent that any assignment or participation is made or purported to be made to a Disqualified Lender
(notwithstanding the other restrictions in this Agreement with respect to Disqualified Lenders), without limiting any other
provision of the Loan Documents,
(A)
upon the request of the Borrower, such Disqualified Lender shall be required immediately (and in
any event within five Business Days) to assign all or any portion of the Loans and Commitments then owned by such
Disqualified Lender (or held as a participation) to another Lender (other than a Defaulting Lender or another
Disqualified Lender), Eligible Assignee or the Borrower, and
(B)
the Borrower shall have the right to prepay all or any portion of the Loans and Commitments then
owned by such Disqualified Lender (or held as a participation), and if applicable, terminate the Commitments of such
Disqualified Lender, in whole or in part.
(ii)
Any such assignment or prepayment shall be made in exchange for an amount equal to the lesser of (A) the
face principal amount of the Loans so assigned and (B) the amount that such Disqualified Lender paid to acquire such
Commitments and/or Loans (it being understood that if the effective date of any such assignment is not an interest payment date,
such assignee shall be entitled to receive on the next succeeding interest payment date interest on the principal amount of the
Loans so assigned that has accrued and is unpaid from the interest payment date last preceding such effective date (except as may
be otherwise agreed between such assignee and the Borrower)).
(iii)
The Borrower shall be entitled to seek specific performance in any applicable court of law or equity to
enforce this Section 10.27. In addition, in connection with any such assignment, (A) if such Disqualified Lender does not execute
and deliver to the Administrative Agent a duly completed Assignment and Assumption and/or any other documentation necessary
or appropriate (in the good faith determination of the Administrative Agent or the Borrower, which determination shall be
conclusive) to reflect such replacement by the later of (1) the date on which the replacement Lender executes and delivers such
Assignment and Assumption and/or such other documentation and (2) the date as of which such Disqualified Lender shall be paid
by the assignee Lender (or, at its option, the Borrower) the amount required pursuant to this section, then such Disqualified Lender
shall be deemed to have executed and delivered such Assignment and Assumption and/or such other documentation as of such
date and the Borrower shall be entitled (but not obligated) to execute and deliver such Assignment and Assumption and/or such
other documentation on behalf of such Disqualified Lender, and the Administrative Agent shall record such assignment in the
Register, (B) each Lender (whether or not then a party hereto) agrees to disclose to the Borrower the amount that the applicable
Disqualified Lender paid to acquire Commitments and/or Loans from such Lender and (C) each Lender that is a Disqualified
Lender agrees to disclose to the Borrower the amount it paid to acquire the Commitments and/or Loans held by it.
(b)
Amendments, Consents and Waivers under the Loan Documents. No Disqualified Lender or Net Short Lender shall
have the right to approve or disapprove any amendment, waiver or consent pursuant to Section 10.01 or under any Loan Document. In
connection with any determination as to whether the requisite Lenders (including whether the Required Lenders or Required Facility
Lenders) have provided any amendment, waiver or consent pursuant to Section 10.01 or under any other Loan Document:
(i)
Disqualified Lenders and Net Short Lenders shall not be considered, and
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(ii)
Disqualified Lenders and Net Short Lenders shall be deemed to have consented to any such amendment,
waiver or consent with respect to its interest as a Lender in the same proportion as the allocation of voting with respect to such
matter by Lenders who are not Disqualified Lenders or Net Short Lenders;
provided that (A) the Commitment of any Disqualified Lender or Net Short Lender may not be increased or extended without the consent of
such Disqualified Lender or Net Short Lender, as applicable, and (B) any waiver, amendment or modification requiring the consent of all
Lenders or each affected Lender that by its terms affects any Disqualified Lender (other than any Net Short Lender) more adversely than
other affected Lenders shall require the consent of such Disqualified Lender.
Each Lender that is not an Unrestricted Lender that delivers a written consent to any amendment, waiver or consent pursuant to
Section 10.01 or under any other Loan Document shall concurrently deliver (or in the absence of any written Net Short Representation will
be deemed to have delivered, concurrently with providing such consent) to the Borrower (with a copy to the Administrative Agent) a Net
Short Representation.
(c)
Limitation on Rights and Privileges of Disqualified Lenders. Except as otherwise provided in Section 10.27(b)(ii), no
Disqualified Lenders shall have the right to, and each such Person covenants and agrees not to, instruct the Administrative Agent, Collateral
Agent or any other Person in respect of the exercise of remedies with respect to the Loans or other Obligations. Further, no Disqualified
Lender that purports to be a Lender or Participant (notwithstanding any provisions of this Agreement that may have prohibited such
Disqualified Lender from becoming Lender or Participant) shall be entitled to any of the rights or privileges enjoyed by the other Lenders
with respect to voting (other than to the extent provided in Section 10.27(b)), and shall be deemed for all purposes to be, at most, a
Defaulting Lender until such time as such Disqualified Lender no longer owns any Loans or Commitments.
(d)
Survival. The provisions of this Section 10.27 shall apply and survive with respect to each Lender and Participant
notwithstanding that any such Person may have ceased to be a Lender or Participant hereunder or this Agreement may have been
terminated.
(e)
Administrative Agent.
(i)
Reliance. The Administrative Agent shall be entitled to rely conclusively on any Net Short Representation
delivered, provided or made (or deemed delivered, provided or made) to it in accordance with this Agreement, shall have no duty
to inquire as to or investigate the accuracy of any Net Short Representation, verify any statements in any officer’s certificate
delivered to it, or otherwise make any calculations, investigations or determinations with respect to any Derivative Instruments or
Net Short Positions or any Person. The Administrative Agent shall have no liability to the Borrower, any Lender or any other
Person in acting in good faith on any notice of Default or acceleration.
(ii)
Disqualified Lender Lists. The Administrative Agent shall have no responsibility or liability for monitoring
or enforcing the list of Disqualified Lenders or for any assignment or participation to a Disqualified Lender.
(iii)
Liability Limitations. The Administrative Agent shall not be responsible or have any liability for, or have
any duty to ascertain, inquire into, monitor or enforce, compliance with the provisions hereof relating to Disqualified Lenders or
Net Short Lenders. Without limiting the generality of the foregoing, the Administrative Agent shall not (x) be obligated to
ascertain, monitor or inquire as to whether any Lender or Participant or prospective Lender or Participant is a
205
Disqualified Lender or Net Short Lender, (y) have any liability with respect to or arising out of any assignment or participation of
commitments or loans, or disclosure of confidential information, to any Disqualified Lender or (z) have any liability with respect
to or arising out of the voting in any amendment or waiver to any Loan Document by any Net Short Lender. The list of
Disqualified Lenders shall be specified on a schedule that is held with the Administrative Agent, which list may be provided to
any Lender or its proposed assignee upon request.
Section 10.28
Erroneous Payments
.
(a)
Each Recipient (and each Participant of any of the foregoing, by its acceptance of a Participation) hereby acknowledges
and agrees that if the Administrative Agent notifies such Recipient that the Administrative Agent has determined in its sole discretion that
any funds (or any portion thereof) received by such Recipient from the Administrative Agent (or any of its Affiliates) were erroneously
transmitted to, or otherwise erroneously or mistakenly received by, such Recipient (whether or not known to such Recipient) (whether as a
payment, prepayment or repayment of principal, interest, fees or otherwise; individually and collectively, a “Payment”) and demands the
return of such Payment, such Recipient shall promptly, but in no event later than one Business Day thereafter, return to the Administrative
Agent the amount of any such Payment as to which such a demand was made. A notice of the Administrative Agent to any Recipient under
this Section shall be conclusive, absent manifest error.
(b)
Without limitation of clause (a) above, each Recipient further acknowledges and agrees that if such Recipient receives
a Payment from the Administrative Agent (or any of its Affiliates) (x) that is in an amount, or on a date different from the amount and/or date
specified in a notice of payment sent by the Administrative Agent (or any of its Affiliates) with respect to such Payment (a “Payment
Notice”), (y) that was not preceded or accompanied by a Payment Notice, or (z) that such Recipient otherwise becomes aware was
transmitted, or received, in error or by mistake (in whole or in part), in each case, it understands and agrees at the time of receipt of such
Payment that an error has been made (and that it is deemed to have knowledge of such error) with respect to such Payment. Each Recipient
agrees that, in each such case, it shall promptly notify the Administrative Agent of such occurrence and, upon demand from the
Administrative Agent, it shall promptly, but in no event later than one Business Day thereafter, return to the Administrative Agent the amount
of any such Payment (or portion thereof) as to which such a demand was made.
(c)
Any Payment required to be returned by a Recipient under this Section 10.28 shall be made in Same Day Funds in the
currency so received, together with interest thereon in respect of each day from and including the date such Payment (or portion thereof) was
received by such Recipient to the date such amount is repaid to the Administrative Agent at the greater of the Federal Funds Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules on interbank compensation from time to time in effect.
Each Recipient hereby agrees that it shall not assert and, to the fullest extent permitted by applicable law, hereby waives, any right to retain
such Payment, and any claim, counterclaim, defense or right of set-off or recoupment or similar right to any demand by the Administrative
Agent for the return of any Payment received, including without limitation any defense based on “discharge for value” or any similar
doctrine.
(d)
The Borrower and each other Loan Party hereby agrees that (x) in the event an erroneous Payment (or portion thereof)
is not recovered from any Lender that has received such Payment (or portion thereof) for any reason, the Administrative Agent shall be
subrogated to all the rights of such Lender with respect to such amount and (y) an erroneous Payment shall not pay, prepay, repay, discharge
or otherwise satisfy any Obligations owed by the Borrower or any other Loan Party except, in each case, to the extent such erroneous
Payment is, and with respect to the amount of such erroneous Payment that is, comprised of funds of the Borrower or any other Loan Party;
provided that this Section 10.29(d) shall not be interpreted
206
to increase (or accelerate the due date for), or have the effect of increasing (or accelerating the due date for), the Obligations of the Borrower
relative to the amount (and/or timing for payment) of the Obligations that would have been payable had such erroneous Payment not been
made by the Administrative Agent.
[THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the date first above written
PEARL MERGER SUB INC., as Initial Borrower (which on
the Closing Date will consummate the Merger, with DOMATAR
CORPORATION surviving as the Borrower)
By:
Name:
Title:
DOMTAR CORPORATION
By:
Name:
Title:
.
[SIGNATURE PAGE TO FIRST LIEN CREDIT AGREEMENT]
PEARL EXCELLENCE HOLDCO L.P., as Holdings
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO FIRST LIEN CREDIT AGREEMENT]
BARCLAYS BANK PLC, as Administrative Agent and Collateral Agent
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO FIRST LIEN CREDIT AGREEMENT]
BARCLAYS BANK PLC, as Initial Term Loan Lender (including with
respect to Delayed Draw Commitments)
__________________________________
By:
Name:
Title:
[SIGNATURE PAGE TO FIRST LIEN CREDIT AGREEMENT]
Exhibit 4.3
Execution Version
Pearl Merger Sub Inc. (to be merged with and into Domtar Corporation),
as Issuer
and the Guarantors party hereto from time to time
6.750% Senior Secured Notes due 2028
________________________
INDENTURE
Dated as of October 18, 2021
________________________
The Bank of New York Mellon,
as Trustee and Collateral Agent
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01
SECTION 1.02
SECTION 1.03
SECTION 1.04
SECTION 1.05
Definitions1
Other Definitions62
Rules of Construction64
No Incorporation by Reference of Trust Indenture Act65
Measuring Compliance65
SECTION 2.01
SECTION 2.02
SECTION 2.03
SECTION 2.04
SECTION 2.05
SECTION 2.06
SECTION 2.07
SECTION 2.08
SECTION 2.09
SECTION 2.10
SECTION 2.11
SECTION 2.12
SECTION 2.13
SECTION 3.01
SECTION 3.02
SECTION 3.03
SECTION 3.04
SECTION 3.05
SECTION 3.06
SECTION 3.07
SECTION 3.08
SECTION 3.09
SECTION 3.10
SECTION 3.11
ARTICLE II
THE NOTES
Amount of Notes69
Form and Dating70
Execution and Authentication70
Registrar and Paying Agent71
Paying Agent to Hold Money in Trust72
Holder Lists72
Transfer and Exchange72
Replacement Notes73
Outstanding Notes74
Cancellation74
Defaulted Interest74
CUSIP Numbers, ISINs, Etc.74
Calculation of Principal Amount of Notes75
ARTICLE III
REDEMPTION
Optional Redemption75
Applicability of Article75
Notices to Trustee75
Selection of Notes to Be Redeemed75
Notice of Optional Redemption76
Effect of Notice of Redemption77
Deposit of Redemption Price78
Notes Redeemed in Part78
Mandatory Redemption78
Escrow of Proceeds; Special Mandatory Redemption78
Special Change of Control Mandatory Redemption79
SECTION 4.01
SECTION 4.02
Payment of Notes80
Reports and Other Information80
ARTICLE IV
COVENANTS
ii
SECTION 4.03
SECTION 4.04
SECTION 4.05
SECTION 4.06
SECTION 4.07
SECTION 4.08
SECTION 4.09
SECTION 4.10
SECTION 4.11
SECTION 4.12
SECTION 4.13
SECTION 4.14
SECTION 4.15
Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and
Preferred Stock84
Limitation on Restricted Payments92
Dividend and Other Payment Restrictions Affecting Subsidiaries102
Asset Sales105
Transactions with Affiliates110
Change of Control113
Compliance Certificate115
[Reserved]116
Future Guarantors116
Liens116
Activities Prior to the Escrow Release119
Maintenance of Office or Agency120
Covenant Suspension120
SECTION 5.01
When Issuer and Guarantors May Merge or Transfer Assets122
ARTICLE V
SUCCESSOR COMPANY
SECTION 6.01
SECTION 6.02
SECTION 6.03
SECTION 6.04
SECTION 6.05
SECTION 6.06
SECTION 6.07
SECTION 6.08
SECTION 6.09
SECTION 6.10
SECTION 6.11
SECTION 6.12
SECTION 7.01
SECTION 7.02
SECTION 7.03
SECTION 7.04
SECTION 7.05
SECTION 7.06
SECTION 7.07
SECTION 7.08
SECTION 7.09
SECTION 7.10
ARTICLE VI
DEFAULTS AND REMEDIES
Events of Default126
Acceleration130
Other Remedies130
Waiver of Past Defaults130
Control by Majority131
Limitation on Suits131
Contractual Rights of the Holders to Receive Payment132
Collection Suit by Trustee132
Trustee May File Proofs of Claim132
Priorities132
Undertaking for Costs133
Waiver of Stay or Extension Laws133
ARTICLE VII
TRUSTEE AND COLLATERAL AGENT
Duties of Trustee and Collateral Agent133
Rights of Trustee and Collateral Agent135
Individual Rights of Trustee137
Trustee’s and Collateral Agent’s Disclaimer137
Notice of Default137
[Intentionally Omitted]137
Compensation and Indemnity138
Replacement of Trustee or Collateral Agent139
Successor by Merger140
Eligibility; Disqualification140
iii
ARTICLE VIII
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01
SECTION 8.02
SECTION 8.03
SECTION 8.04
SECTION 8.05
SECTION 8.06
Discharge of Liability on Notes; Defeasance140
Conditions to Defeasance142
Application of Trust Money144
Repayment to Issuer144
Indemnity for U.S. Government Obligations144
Reinstatement144
ARTICLE IX
AMENDMENTS AND WAIVERS
SECTION 9.01
SECTION 9.02
SECTION 9.03
SECTION 9.04
SECTION 9.05
Without Consent of the Holders144
With Consent of the Holders146
Revocation and Effect of Consents and Waivers148
Notation on or Exchange of Notes149
Trustee and Collateral Agent to Sign Amendments149
ARTICLE X
[INTENTIONALLY OMITTED]
ARTICLE XI
[INTENTIONALLY OMITTED]
ARTICLE XII
GUARANTEE
SECTION 12.01
SECTION 12.02
SECTION 12.03
SECTION 12.04
SECTION 12.05
SECTION 12.06
SECTION 12.07
SECTION 12.08
Guarantee149
Limitation on Liability151
[Intentionally Omitted]153
[Intentionally Omitted]153
No Waiver153
Modification153
Execution of Supplemental Indenture for Future Guarantors153
Non-Impairment153
ARTICLE XIII
COLLATERAL AND SECURITY
SECTION 13.01
SECTION 13.02
SECTION 13.03
SECTION 13.04
SECTION 13.05
SECTION 13.06
SECTION 13.07
SECTION 13.08
SECTION 13.09
Collateral153
[Intentionally Omitted]154
Impairment of Security Interests154
Further Assurances155
After-Acquired Property155
[Intentionally Omitted]155
Negative Pledge155
Release of Liens on the Collateral155
Authorization of Actions to be Taken by the Trustee or the Collateral Agent under the
Security Documents and the Intercreditor Agreements157
iv
SECTION 13.10
SECTION 13.11
SECTION 13.12
Information Regarding Collateral158
Security Documents and Intercreditor Agreements159
Collateral Agent159
SECTION 14.01
SECTION 14.02
SECTION 14.03
SECTION 14.04
SECTION 14.05
SECTION 14.06
SECTION 14.07
SECTION 14.08
SECTION 14.09
SECTION 14.10
SECTION 14.11
SECTION 14.12
SECTION 14.13
SECTION 14.14
SECTION 14.15
SECTION 14.16
SECTION 14.17
SECTION 14.18
SECTION 14.19
ARTICLE XIV
MISCELLANEOUS
[Intentionally Omitted]160
Notices160
[Intentionally Omitted]162
Certificate and Opinion as to Conditions Precedent162
Statements Required in Certificate or Opinion163
When Notes Disregarded163
Rules by Trustee, Paying Agent and Registrar163
Legal Holidays163
GOVERNING LAW; Consent to Jurisdiction164
No Recourse Against Others164
Successors164
Multiple Originals164
Table of Contents; Headings164
Indenture Controls165
Severability165
Waiver of Jury Trial165
Calculations165
USA Patriot Act165
No Adverse Interpretation of Other Agreements.166
Appendix A
–
Provisions Relating to Initial Notes and Additional Notes
EXHIBIT INDEX
Exhibit A
Exhibit B
Exhibit C-1
Exhibit C-2
Exhibit D
–Form of Initial Note
–Form of Transferee Letter of Representation
–Form of Supplemental Indenture to Be Delivered on the Merger Date
–Form of Supplemental Indenture to Be Delivered by Future Guarantors
–Form of Junior Lien Intercreditor Agreement
v
INDENTURE, dated as of October 18, 2021 (as amended or supplemented from time to time, this “Indenture”), among
the Issuer (as defined below), the Guarantors (as defined below) party hereto from time to time and The Bank of New York
Mellon, as trustee (in such capacity, the “Trustee”) and as collateral agent (in such capacity, the “Collateral Agent”).
On the Merger Date (as defined below), Pearl Merger Sub Inc., a newly formed corporation formed under the laws of
Delaware (the “Escrow Issuer”) and a subsidiary of Karta Halten B.V., a private limited company organized under the laws of the
Netherlands , will merge with and into Domtar Corporation, a Delaware corporation (the “Company”), with the Company
continuing as the surviving corporation and becoming the ultimate issuer of the Notes and assuming all of the obligations of the
Escrow Issuer under the Notes and this Indenture. Subject to the satisfaction of the Escrow Condition, the Company, each of the
Guarantors, the Trustee and the Collateral Agent shall enter into a supplemental indenture in the form of Exhibit C-1 hereto,
pursuant to which, (A) the Company will become a party to this Indenture and expressly assume all of the rights and obligations
of Escrow Issuer under this Indenture and the Notes (as defined herein), as the successor obligor under the Notes and this
Indenture, (B) the Company will be substituted for, and may exercise every right and power of, Escrow Issuer, shall be the
“Issuer” under this Indenture and the Notes and (C) each of the Guarantors shall become a “Guarantor” and “Subsidiary
Guarantor” under this Indenture and the Notes, and shall guarantee, jointly and severally, the Issuer’s obligations under this
Indenture and the Notes. All references to the “Issuer” mean, (i) prior to the consummation of the Merger, the Escrow Issuer,
and, (ii) on and following the consummation of the Merger, the Company.
Each party agrees as follows for the benefit of the other parties and for the equal and ratable benefit of the holders of
(i) $775,000,000 aggregate principal amount of the Issuer’s 6.750% Senior Secured Notes due 2028 issued on the date hereof (the
“Initial Notes”) and (ii) Additional Notes issued from time to time (together with the Initial Notes, the “Notes”):
DEFINITIONS AND INCORPORATION BY REFERENCE
ARTICLE I
SECTION 1.01
Definitions
.
“ABL Collateral Agent” means Barclays Bank PLC and any successor thereof in such capacity under the ABL Credit
Agreement.
“ABL Credit Agreement” means the asset-based revolving credit agreement to be entered into on or prior to the Merger
Date among the Issuer, Holdings, the lenders party thereto, the other parties thereto and Barclays Bank PLC, as administrative
agent and collateral agent, as amended, restated, supplemented, waived, replaced (whether or not upon termination, or in effect at
such time, and whether with the original lenders or otherwise), restructured, repaid, refunded, refinanced or otherwise modified
from time to time, including any agreement or indenture extending the maturity thereof, refinancing, replacing or otherwise
restructuring all or any portion of the Indebtedness, Disqualified Stock or Preferred Stock under such agreement or agreements or
indenture or indentures or any successor or replacement agreement or agreements or indenture or indentures or increasing the
amount loaned or issued thereunder or altering the maturity thereof
(except to the extent any such refinancing, replacement or restructuring or agreement or instrument is designated by the Issuer to
not be included in this definition).
“ABL Intercreditor Agreement” means that certain intercreditor agreement, to be entered into on or around the Merger
Date, by and among the Collateral Agent, the Term Loan Collateral Agent, the ABL Collateral Agent and each additional agent
from time to time party thereto, and acknowledged by the grantors party thereto, as amended, restated, amended and restated,
extended, supplemented or otherwise modified from time to time in accordance with its terms and this Indenture.
“ABL Obligations” means the Obligations under the ABL Credit Agreement.
“Acquired Indebtedness” means, with respect to any specified Person:
(1)
Indebtedness of any other Person existing at the time such other Person is merged, consolidated or
amalgamated with or into or became a Restricted Subsidiary of such specified Person, and
(2)
Indebtedness secured by a Lien encumbering any asset acquired by such specified Person.
Acquired Indebtedness will be deemed to have been Incurred, with respect to clause (1) of the preceding sentence, on
the date such Person becomes a Restricted Subsidiary and, with respect to clause (2) of the preceding sentence, on the date of
consummation of such acquisition of such assets.
“Acquisition Transaction” means the purchase or other acquisition (in one transaction or a series of transactions,
including by merger, amalgamation or otherwise) by the Issuer or any Restricted Subsidiary of all or substantially all the
property, assets or business of another Person, or assets constituting a business unit, line of business or division of, any Person, or
of a majority of the outstanding Equity Interests of any Person (including any Investment which serves to increase the Issuer’s or
any Restricted Subsidiary’s respective equity ownership in any Joint Venture or other Person to an amount in excess (or further in
excess) of the majority of the outstanding Equity Interests of such Joint Venture or other Person).
“Additional Notes” means the Notes issued under the terms of this Indenture subsequent to the Issue Date.
“Additional Refinancing Amount” means, in connection with any Permitted Refinancing of any Indebtedness,
Disqualified Stock or Preferred Stock, the aggregate principal amount of additional Indebtedness, Disqualified Stock or Preferred
Stock Incurred to pay (1) accrued and unpaid interest; (2) the increased principal amount of any Indebtedness being refinanced
resulting from the in-kind payment of interest on such Indebtedness (or in the case of Disqualified Stock or Preferred Stock being
refinanced, additional shares of such Disqualified Stock or Preferred Stock); (3) the aggregate amount of original issue discount
on the Indebtedness, Disqualified Stock or Preferred Stock being refinanced; (4) premiums (including tender premiums) and
other costs associated with the redemption, repurchase, retirement, discharge or defeasance of Indebtedness, Disqualified Stock
or Preferred Stock being refinanced; (5) all fees and expenses (including
2
underwriting discounts, commitment, ticking and similar fees, expenses and discounts) associated with the repayment of the
Indebtedness, Disqualified Stock or Preferred Stock being refinanced and the Incurrence of the Indebtedness, Disqualified Stock
or Preferred Stock Incurred in connection with such refinancing; and (6) any existing unutilized commitment with respect to such
Indebtedness.
“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. “Controlled” has the meaning correlative thereto.
“Applicable Premium” means, with respect to any Note on any applicable redemption date, as determined by the Issuer,
the greater of:
(1)
(2)
1.0% of the then outstanding principal amount of the Note; and
the excess, if any, of:
(a)
the present value at such redemption date of (i) the redemption price of such Note, at October 1,
2024 (such redemption price being set forth in Paragraph 5 of the Note set forth in Exhibit A hereto) plus (ii) all
required interest payments due on the Note through October 1, 2024 (excluding accrued but unpaid interest), in the case
of each of subclauses (i) and (ii), computed using a discount rate equal to the Treasury Rate as of the date of the
redemption notice plus 50 basis points; over
(b)
the then outstanding principal amount of the Note.
The Trustee shall have no duty to calculate, or verify the Issuer’s calculation of, the Applicable Premium.
“Approved Commercial Bank” means a commercial bank with a consolidated combined capital and surplus of at least
$5,000,000,000.
“Asset Sale” means:
(1)
the sale, conveyance, transfer or other disposition (whether in a single transaction or a series of related
transactions) of property or assets (including by way of Sale/Leaseback Transactions) outside the ordinary course of business of
the Issuer or any Restricted Subsidiary (each referred to in this definition as a “disposition”); or
(2)
the issuance or sale of Equity Interests (other than directors’ qualifying shares and shares issued to foreign
nationals or other third parties to the extent required by applicable law) of any Restricted Subsidiary (other than to the Issuer or
another Restricted Subsidiary) (whether in a single transaction or a series of related transactions and whether enacted pursuant to
a Division or otherwise),
in each case other than:
3
(a)
dispositions of obsolete, damaged, worn out, used or surplus property (including for purposes of
recycling), whether now owned or hereafter acquired and dispositions of property of the Issuer and the Restricted
Subsidiaries that is no longer used or useful in the conduct of the business or economically practicable or commercially
desirable to maintain;
(b)
dispositions of property in the ordinary course of business or consistent with past practice or
industry norms;
(c)
dispositions of property to the extent that (i) such property is exchanged for credit against the
purchase price of similar replacement property or (ii) the proceeds of such disposition are promptly applied to the
purchase price of such replacement property;
(d)
dispositions of property to the Issuer or a Restricted Subsidiary;
(e)
Restricted Payments permitted by Section 4.04 herein, transactions permitted by Section 5.01 herein
or any transaction that constitutes a Change of Control and Liens permitted by Section 4.12 herein and the definition of
“Permitted Liens”;
(f)
dispositions of property pursuant to Sale/Leaseback Transactions;
(g)
Securities when made;
dispositions of Cash Equivalents or Investments that were Cash Equivalents or Investment Grade
(h)
leases, subleases, licenses or sublicenses of real or personal property (including the provision of
software under an open source license or the license or sublicense of any intellectual property), which do not materially
interfere with the business of the Issuer and the Restricted Subsidiaries, taken as a whole, or that are in ordinary course
of business or consistent with past practice or industry norm;
(i)
dispositions of property subject to Casualty Events upon receipt of the Net Proceeds of such
Casualty Event;
(j)
[reserved];
(k)
dispositions of Investments in Joint Ventures to the extent required by, or made pursuant to
customary buy/sell arrangements between, the Joint Venture parties set forth in Joint Venture arrangements and similar
binding arrangements;
(l)
dispositions or discounts of accounts receivable and related assets in connection with the collection,
compromise or factoring thereof and any sale, discount or other disposition of inventory, accounts receivable, notes
receivable or other assets in the ordinary course of business or the conversion of accounts receivable to notes
receivable;
(m)
dispositions (including issuances or sales) of Equity Interests in, or Indebtedness owing to, or of
other securities of, an Unrestricted Subsidiary (other than an Unrestricted Subsidiary the primary assets of which are
cash and Cash Equivalents);
4
(n)
dispositions to the extent of any exchange of like property (excluding any boot thereon permitted by
such provision) for use in any business conducted by the Issuer or any of the Restricted Subsidiaries to the extent
allowable under Section 1031 of the Code (or comparable or successor provision);
(o)
Hedge Agreement;
dispositions in connection with the unwinding, termination, settlement or extinguishment of any
(p)
dispositions by the Issuer or any Restricted Subsidiary of assets in connection with the closing or
sale of a facility in the ordinary course of business of the Issuer and its Restricted Subsidiaries;
(q)
dispositions (including bulk sales) of the inventory not in the ordinary course of business in
connection with facility closings;
(r)
disposition of (i) Securitization Assets to a Securitization Subsidiary and (ii) any other
Securitization Assets subject to Liens securing Qualified Securitization Financings;
(s)
the lapse, abandonment or discontinuance of the use or maintenance of any intellectual property if
the Issuer or any Restricted Subsidiary determines in its reasonable business judgment that such lapse, abandonment or
discontinuance is desirable in the conduct of its business;
(t)
any disposition of assets or issuance or sale of Equity Interests of any Restricted Subsidiary, in a
single transaction or series of related transactions, with an aggregate Fair Market Value of less than or equal to the
greater of (a) 10.0% of Closing Date EBITDA and (b) 10.0% of TTM Consolidated Adjusted EBITDA as of the
applicable date of determination;
(u)
disposition of assets acquired in an acquisition or other Investment permitted under this Indenture
that the Issuer determines will not be used or useful in the business of the Issuer and its Restricted Subsidiaries;
(v)
any exchange of assets (including a combination of assets and a de minimis amount of Cash
Equivalents) for assets related to a Similar Business of comparable or greater market value or usefulness to the business
of the Issuer and the Restricted Subsidiaries as a whole, as determined in good faith by the Issuer;
(w)
foreclosure, condemnation, expropriation, forced disposition or any similar action with respect to
any property or other asset of the Issuer or any of the Restricted Subsidiaries;
(x)
any disposition of Equity Interests of a Restricted Subsidiary pursuant to an agreement or other
obligation with or to a Person (other than the Issuer or a Restricted Subsidiary) from whom such Restricted Subsidiary
was acquired or from whom such Restricted Subsidiary acquired its business and assets (having been newly formed in
5
connection with such acquisition), made as part of such acquisition and in each case comprising all or a portion of the
consideration in respect of such sale or acquisition;
(y)
any surrender, expiration or waiver of contract rights or the settlement, release, recovery on or
surrender of contract, tort or other claims of any kind;
(z)
any disposition of assets involving assets having a Fair Market Value (as reasonably determined by
the Issuer) of (i) the greater of (a) 2.5% of Closing Date EBITDA and (b) 2.5% of TTM Consolidated Adjusted
EBITDA as of the applicable date of determination per transaction or series of related transactions or (ii) the greater of
(a) 7.5% of Closing Date EBITDA and (b) 7.5% of TTM Consolidated Adjusted EBITDA as of the applicable date of
determination in the aggregate per fiscal year; provided that in any given fiscal year, any amount not utilized pursuant
to this clause (z) may be carried forward to subsequent fiscal years and may be used in such fiscal year prior to utilizing
the capacity in this clause (z) for such fiscal year, in an amount not to exceed $30,000,000 in the aggregate for all
subsequent fiscal years; and
(aa)
any disposition of Excluded Assets by Restricted Subsidiaries that are not Guarantors and any
disposition of Excluded Assets by the Issuer or any Guarantor for Fair Market Value.
For the avoidance of doubt, the issuance or conversion of equity by the Issuer or a Restricted Subsidiary to the Issuer or
another Restricted Subsidiary is not a disposition.
“Bank Indebtedness” means any and all amounts payable under or in respect of (a) the Credit Agreements and the other
Credit Agreement Documents, as amended, restated, supplemented, waived, replaced (whether or not upon termination, and
whether with the original lenders or otherwise), restructured, repaid, refunded, refinanced or otherwise modified from time to
time (including after termination of any Credit Agreement), including any agreement or indenture extending the maturity thereof,
refinancing, replacing or otherwise restructuring all or any portion of the Indebtedness under such agreement or agreements or
indenture or indentures or any successor or replacement agreement or agreements or indenture or indentures or increasing the
amount loaned or issued thereunder or altering the maturity thereof, including principal, premium (if any), interest (including
interest, fees and expenses accruing on or after the filing of any petition in bankruptcy or for reorganization relating to the Issuer
whether or not a claim for post-petition interest, fees or expenses is allowed in such proceedings), fees, charges, expenses,
reimbursement obligations, guarantees and all other amounts payable thereunder or in respect thereof (except to the extent any
such refinancing, replacement, restructuring or other agreement or instrument is designated by the Issuer to not be included in
this definition) and (b) whether or not the Indebtedness referred to in clause (a) remains outstanding, if designated by the Issuer to
be included in this definition, one or more (A) debt facilities or commercial paper facilities, providing for revolving credit loans,
term loans, reserve-based loans, securitization or receivables financing (including through the sale of receivables to lenders or to
special purpose entities formed to borrow from lenders against such receivables) or letters of credit, (B) debt securities,
indentures or other forms of debt financing (including convertible or exchangeable debt instruments or bank guarantees or
bankers’ acceptances), or (C) instruments or agreements evidencing any other Indebtedness, in each case, with the same or
different borrowers or issuers and, in each case, as
6
amended, supplemented, modified, extended, restructured, renewed, refinanced, restated, replaced or refunded in whole or in part
from time to time.
“Bankruptcy Code” means Title 11 of the United States Code, as amended.
“Board of Directors” means, as to any Person, the board of directors, board of managers, sole member or managing
member or other governing body of such Person, or if such Person is owned or managed by a single entity or has a general
partner, the board of directors, board of managers, sole member or managing member or other governing body of such entity or
general partner, or in each case, any duly authorized committee thereof, and the term “directors” means members of the Board of
Directors.
“Borrowing Base” means, as of any date, an amount equal to the sum of (i) 90.0% of accounts receivable; (ii) the lesser
of (a) 75.0% of the cost of inventory and (b) 85.0% of the net orderly liquidation value of inventory; and (iii) 100% of cash and
Cash Equivalents, in each case of clauses (i), (ii) and (iii) of the Issuer and its Restricted Subsidiaries calculated on a consolidated
basis and on a Pro Forma Basis.
“Business Day” means a day other than a Saturday, Sunday or other day on which banking institutions are authorized or
required by Law to close in New York City, the jurisdiction where the Trustee is located or the place of payment.
“Canadian Subsidiary” means any Subsidiary organized under the laws of Canada or any province or territory thereof.
“Capital Stock” means:
(1)
(2)
in the case of a corporation, corporate stock or shares;
in the case of an association or business entity, any and all shares, interests, participations, rights or other
equivalents (however designated) of corporate stock;
(3)
general or limited); and
in the case of a partnership or limited liability company, partnership or membership interests (whether
(4)
any other interest or participation that confers on a Person the right to receive a share of the profits and losses
of, or distributions of assets of, the issuing Person.
“Capitalized Lease Obligation” means, at the time any determination thereof is to be made, the amount of the liability
in respect of a Capitalized Lease that would at such time be required to be capitalized and reflected as a liability on a balance
sheet (excluding the footnotes thereto) prepared in accordance with GAAP.
“Capitalized Leases” means all capital or financing leases that have been or are required to be, in accordance with
GAAP as in effect on the Merger Date (including the Issuer’s adoption of Accounting Standards Update (ASU) No. 2016-02,
Leases (Topic 842)), recorded as capital or financing leases; provided that (i) for all purposes hereunder the amount of obligations
under any Capitalized Lease shall be the amount thereof accounted for as a liability in accordance with GAAP
7
as in effect on the Merger Date (including the Issuer’s adoption of Accounting Standards Update (ASU) No. 2016-02, Leases
(Topic 842)) and (ii) in no event shall an operating lease or a lease that would have been an operating lease prior to the adoption
of Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842)) be considered a Capitalized Lease.
“Captive Insurance Subsidiary” means any Subsidiary of the Issuer that is subject to regulation as an insurance
company (or any Subsidiary thereof).
“Cash Equivalents” means any of the following types of Investments (including for the avoidance of doubt, cash), to
the extent owned by the Issuer or any Restricted Subsidiary:
(1)
(2)
U.S. dollars or Canadian dollars;
local currencies held by the Issuer or any Restricted Subsidiary from time to time in the ordinary course of
business and not for speculation;
(3)
readily marketable direct obligations issued or directly and fully and unconditionally guaranteed or insured
by the United States government or any agency or instrumentality thereof the securities of which are unconditionally guaranteed
as a full faith and credit obligation of such government with maturities of 12 months or less from the date of acquisition;
(4)
certificates of deposit, time deposits and eurodollar time deposits with maturities of one year or less from the
date of acquisition, demand deposits, bankers’ acceptances with maturities not exceeding one year and overnight bank deposits,
in each case with any domestic or foreign commercial bank having capital and surplus of not less than $500,000,000 (or the
foreign currency equivalent thereof as of the date of such investment);
(5)
repurchase obligations for underlying securities of the types described in clauses (3) and (4) above or
clause (6) below entered into with any financial institution meeting the qualifications specified in clause (4) above;
(6)
commercial paper rated at least P-2 by Moody’s or at least A-2 by S&P (or, if at any time neither Moody’s
nor S&P shall be rating such obligations, an equivalent rating from another nationally recognized statistical rating agency) and in
each case maturing within 12 months after the date of creation thereof;
(7)
marketable short-term money market and similar highly liquid funds having a rating of at least P-2 or A-2
from Moody’s or S&P, respectively (or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent
rating from another nationally recognized statistical rating agency);
(8)
readily marketable direct obligations issued by any state, commonwealth or territory of the United States or
any political subdivision or taxing authority thereof, in each case having an Investment Grade Rating from either Moody’s or
S&P (or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from another nationally
recognized statistical rating agency) with maturities of 12 months or less from the date of acquisition;
8
(9)
Investments with average maturities of 12 months or less from the date of acquisition in money market funds
rated AAA- (or the equivalent thereof) or better by S&P or Aaa3 (or the equivalent thereof) or better by Moody’s (or, if at any
time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from another nationally recognized statistical
rating agency);
(10)
through (9) above; and
investment funds investing substantially all of their assets in securities of the types described in clauses (1)
(11)
solely with respect to any Captive Insurance Subsidiary, any investment that a Captive Insurance Subsidiary
is not prohibited to make in accordance with applicable law.
In the case of Investments by any Foreign Subsidiary that is a Restricted Subsidiary or Investments made in a
jurisdiction outside the United States, Cash Equivalents shall also include (i) investments of the type and maturity described in
clauses (1) through (11) above in foreign obligors, which Investments or obligors (or the parents of such obligors) have ratings
described in such clauses or equivalent ratings from comparable foreign rating agencies and (ii) other short-term investments in
accordance with normal investment practices for cash management in investments analogous to the foregoing investments in
clauses (1) through (11) above and in this paragraph. Notwithstanding the foregoing, Cash Equivalents shall include amounts
denominated in currencies other than those set forth in clause (1) or (2) above; provided that such amounts, except amounts used
to pay obligations of the Issuer or any Restricted Subsidiary denominated in any currency other than U.S. dollars in the ordinary
course of business, are converted into U.S. dollars as promptly as practicable and in any event within 10 Business Days following
the receipt of such amounts.
“cash management services” means any agreement or arrangement to provide cash management services, including
treasury, depository, overdraft, credit card processing, credit or debit card, purchase card, electronic funds transfer and other cash
management arrangements.
“Casualty Event” means any event that gives rise to the receipt by the Issuer or any Subsidiary Guarantor of any
insurance proceeds or condemnation or expropriation awards, in each case, in respect of any equipment, fixed assets or real
property (including any improvements thereon) to replace or repair such equipment, fixed assets or real property.
“CFC” means a “controlled foreign corporation” within the meaning of Section 957(a) of the Code.
“Change of Control” means the occurrence of either of the following:
(1)
the sale, lease or transfer, in one or a series of related transactions, of all or substantially all the assets of the
Issuer and its Subsidiaries, taken as a whole, to a Person other than any of the Permitted Holders; or
(2)
the Issuer becomes aware (by way of a report or any other filing pursuant to Section 13(d) of the Exchange
Act, proxy, vote, written notice or otherwise) of the acquisition by any Person or group (within the meaning of Section 13(d)(3)
or Section 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring,
holding
9
or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act, but excluding any employee benefit
plan of such Person and its Subsidiaries, and any Person acting in its capacity as trustee, agent or other fiduciary or administrator
of any such plan), other than any of the Permitted Holders, in a single transaction or in a related series of transactions, of
beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act, or any successor provision) of more than 50%
of the total voting power of the Voting Stock of the Issuer.
Notwithstanding the foregoing: (A) the transfer of assets between or among the Issuer and the Restricted Subsidiaries
shall not itself constitute a Change of Control and (B) a Person or group shall not be deemed to have beneficial ownership of
securities subject to a stock purchase agreement, merger agreement or similar agreement (or voting or option agreement related
thereto) prior to the consummation of the transactions contemplated by such agreement.
In addition, notwithstanding the foregoing, a transaction in which the Issuer or a parent entity of the Issuer becomes a
subsidiary of another Person (such Person, the “New Parent”) shall not constitute a Change of Control if (a) the equityholders of
the Issuer or such parent entity immediately prior to such transaction beneficially own, directly or indirectly through one or more
intermediaries, at least a majority of the total voting power of the Voting Stock of the Issuer or such New Parent immediately
following the consummation of such transaction, substantially in proportion to their holdings of the equity of the Issuer or such
parent entity prior to such transaction or (b) immediately following the consummation of such transaction, no Person, other than a
Permitted Holder, the New Parent or any subsidiary of the New Parent, beneficially owns, directly or indirectly through one or
more intermediaries, more than 50% of the voting power of the Voting Stock of the Issuer or the New Parent.
“Closing Date EBITDA” means $415,000,000.
“Closing Date First Lien Net Leverage Ratio” means 3.70 to 1.00.
“Closing Date Secured Net Leverage Ratio” means 3.70 to 1.00.
“Closing Date Total Net Leverage Ratio” means 3.70 to 1.00.
“Code” means the U.S. Internal Revenue Code of 1986, as amended from time to time.
“Co-Investor” means any of (a) the assignees, if any, of the equity commitments of Jackson Wijaya who became
holders of Equity Interests in Holdings (or any of the direct or indirect parent companies of Holdings) on the Closing Date in
connection with the Merger and (b) the transferees, if any, that acquired, within 45 days of the Merger Date, any Equity Interests
in Holdings (or any of the direct or indirect parent companies of Holdings) held by Jackson Wijaya as of the Closing Date;
provided, that Co-Investors under this clause (b) do not in the aggregate hold more than 49.9% of the ordinary voting power
represented by the issued and outstanding Equity Interests of Holdings (or any of the direct or indirect parent companies of
Holdings).
“Collateral” means all the “Collateral” (or equivalent term) as defined in any Security Document and all other property
that is subject or purported to be subject to any Lien in favor of the Collateral Agent pursuant to any Security Document, but in
any event excluding all Excluded Assets.
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“Collateral Agent” has the meaning set forth in the preamble hereto.
“Company” has the meaning set forth in the preamble hereto.
“Company Person” means any future, current or former officer, director, manager, member, member of management,
employee, consultant or independent contractor of the Issuer, any Subsidiary, Holdings or any other Parent Entity.
“Consolidated Adjusted EBITDA” means, with respect to any Person for any Test Period, the Consolidated Net Income
of such Person for such Test Period:
(1)
increased, without duplication, by the following items (solely to the extent deducted (and not excluded) in
calculating Consolidated Net Income, other than in respect of the proviso in clause (a) below and clauses (b)(B), (l), (t) and
(u) below) of such Person and its Restricted Subsidiaries for such Test Period determined on a consolidated basis in accordance
with GAAP:
(a)
interest expense, including (A) imputed interest on Capitalized Lease Obligations and the
capitalized amount of Capitalized Leases that would appear on a balance sheet of such Person on such date in
accordance with GAAP (which, in each case, will be deemed to accrue at the interest rate reasonably determined by an
Officer of the Issuer to be the rate of interest implicit in such Capitalized Lease Obligations or such attributed
Indebtedness), (B) commissions, discounts and other fees, charges and expenses owed with respect to letters of credit,
bankers’ acceptance financing, surety and performance bonds and receivables financings, (C) amortization and write-
offs of deferred financing fees, debt issuance costs, debt discounts, commissions, fees, premium and other expenses, as
well as expensing of bridge, commitment or financing fees, (D) payments made in respect of hedging obligations or
other derivative instruments entered into for the purpose of hedging interest rate risk, (E) cash contributions to any
employee stock ownership plan or similar trust to the extent such contributions are used by such plan or trust to pay
interest or fees to any Person (other than such Person or a Wholly Owned Restricted Subsidiary) in connection with
Indebtedness Incurred by such plan or trust, (F) all interest paid or payable with respect to discontinued operations,
(G) the interest portion of any deferred payment obligations, and (H) all interest on any Indebtedness that is
(x) Indebtedness of others secured by any Lien on property owned or acquired by such Person or its Restricted
Subsidiaries, whether or not the obligations secured thereby have been assumed, but limited to the Fair Market Value of
such property or (y) contingent obligations in respect of Indebtedness; provided that that such interest expense shall be
calculated after giving effect to Hedge Agreements related to interest rates (including associated costs), but excluding
unrealized gains and losses with respect to such Hedge Agreements or (z) fees and expenses paid to the administrative
agent under the Term Loan Credit Agreement (in its capacity as such and for its own accord) pursuant to the Term Loan
Credit Agreement and fees and expenses paid to the administrative agent, the collateral agent, trustee or other similar
Persons for any other Indebtedness permitted under Section 4.03 herein; provided, further, that, when determining such
interest expense in respect of any Test Period ending prior to the first anniversary of the Merger Date, such interest
expense will be calculated by multiplying the aggregate amount of such interest expense accrued since the Merger Date
by 365 and then dividing such product by the
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number of days from and including the Merger Date to and including the last day of such Test Period; plus
(b)
taxes based on gross receipts, income, profits or revenue or capital, franchise, excise, property,
commercial activity, sales, use, unitary or similar taxes, and foreign withholding taxes, including (A) penalties and
interest and (B) tax distributions made to any direct or indirect holders of Equity Interests of such Person in respect of
any such taxes attributable to such Person and/or its Restricted Subsidiaries or pursuant to a tax sharing arrangement or
as a result of a tax distribution or repatriated fund; plus
(c)
depreciation expense and amortization expense (including amortization and similar charges related
to goodwill, customer relationships, trade names, databases, technology, software, internal labor costs, deferred
financing fees or costs and other intangible assets); plus
(d)
non-cash items (provided that if any such non-cash item represents an accrual or reserve for
potential cash items in any future period, (x) the Issuer may determine not to add back such non-cash item in the
current Test Period and (y) to the extent the Issuer decides to add back such non-cash expense or charge, the cash
payment in respect thereof in such future period will be subtracted from Consolidated Adjusted EBITDA in such future
period), including the following: (A) non-cash expenses in connection with, or resulting from, stock option plans,
employee benefit plans or agreements or post-employment benefit plans or agreements, or grants or sales of stock,
stock appreciation or similar rights, stock options, restricted stock, Preferred Stock or other similar rights, (B) non-cash
currency translation losses related to changes in currency exchange rates (including re-measurements of Indebtedness
(including intercompany Indebtedness) and any net non-cash loss resulting from hedge agreements for currency
exchange risk), (C) non-cash losses, expenses, charges or negative adjustments attributable to the movement in the
mark-to-market valuation of hedge agreements or other derivative instruments, including the effect of FASB
Accounting Standards Codification 815 and International Accounting Standard No. 9 and their respective related
pronouncements and interpretations, (D) non-cash charges for deferred tax asset valuation allowances, (E) any non-
cash impairment charge or asset write-off or write-down related to intangible assets (including goodwill), long-lived
assets, and Investments in debt and equity securities, (F) any non-cash charges or losses resulting from any purchase
accounting adjustment or any step-ups with respect to re-valuing assets and liabilities in connection with the
Transactions or any Investments either existing or arising after the Issue Date, (G) all non-cash losses from Investments
either existing or arising after the Issue Date recorded using the equity method, (H) the excess of GAAP rent expense
over actual cash rent paid during such period due to the use of straight line rent for GAAP purposes and (I) any non-
cash interest expense; plus
(e)
GAAP; plus
unusual, extraordinary, infrequent, or non-recurring items, whether or not classified as such under
(f)
charges, costs, losses, expenses or reserves related to: (A) restructuring (including restructuring
charges or reserves, whether or not classified as such under
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GAAP), severance, relocation, consolidation, integration or other similar items, (B) strategic and/or business initiatives,
business optimization (including costs and expenses relating to business optimization programs, which, for the
avoidance of doubt, shall include, without limitation, implementation of operational and reporting systems and
technology initiatives; strategic initiatives; retention; severance; systems establishment costs; systems conversion and
integration costs; contract termination costs; recruiting and relocation costs and expenses; costs, expenses and charges
incurred in connection with curtailments or modifications to pension and post-retirement employee benefits plans; costs
to start-up, pre-opening, opening, closure, transition and/or consolidation of distribution centers, operations, officers
and facilities) including in connection with the Transactions and any Permitted Investment, any acquisition or other
investment consummated prior to or after the Issue Date and new systems design and implementation, as well as
consulting fees and any one-time expense relating to enhanced accounting function, (C) business or facilities (including
greenfield facilities) start-up, opening, transition, consolidation, shut-down and closing, (D) signing, retention and
completion bonuses, (E) severance, relocation or recruiting, (F) public company registration, listing, compliance,
reporting and related expenses, (G) charges and expenses incurred in connection with litigation (including threatened
litigation), any investigation or proceeding (or any threatened investigation or proceeding) by a regulatory,
governmental or law enforcement body (including any attorney general), and (H) expenses incurred in connection with
casualty events or asset sales outside the ordinary course of business; plus
(g)
all (A) costs, fees and expenses relating to the Transactions, (B) costs, fees and expenses (including
diligence and integration costs) incurred in connection with (x) investments in any Person, acquisitions of the Equity
Interests of any Person, acquisitions of all or a material portion of the assets of any Person or constituting a line of
business of any Person, and financings related to any of the foregoing or to the capitalization of the Issuer or any
Guarantor or other Restricted Subsidiary or (y) other transactions that are out of the ordinary course of business of such
Person and its Restricted Subsidiaries (in each case, including transactions considered or proposed but not
consummated), including equity issuances, Investments, acquisitions, dispositions, recapitalizations, mergers,
amalgamations, option buyouts and the incurrence, modification or repayment of Indebtedness (including all consent
fees, premium and other amounts payable in connection therewith) and (C) non-operating professional fees, costs and
expenses; plus
(h)
[reserved];
(i)
items reducing Consolidated Net Income to the extent (A) covered by a binding indemnification or
refunding obligation or insurance to the extent actually paid or reasonably expected to be paid, (B) paid or payable
(directly or indirectly) by a third party that is not the Issuer or a Guarantor or other Restricted Subsidiary (except to the
extent such payment gives rise to reimbursement obligations) or with the proceeds of a contribution to equity capital of
such Person by a third party that is not the Issuer or a Guarantor or other Restricted Subsidiary or (C) such Person is,
directly or indirectly, reimbursed for such item by a third party; plus
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(j)
the amount of management, monitoring, consulting, transaction and advisory fees (including
termination fees) and related indemnities and expenses paid, payable or accrued in such Test Period (including any
termination fees payable in connection with the early termination of management and monitoring agreements); plus
(k)
the effects of purchase accounting, fair value accounting or recapitalization accounting (including
the effects of adjustments pushed down to such Person and its Subsidiaries) and the amortization, write-down or write-
off of any such amount; plus
(l)
the proceeds of business interruption insurance actually received (to the extent not counted in any
prior period in anticipation of such receipt) or, to the extent not counted in any prior period, reasonably expected to be
received; plus
(m)
minority interest expense, consisting of income attributable to Equity Interests held by third parties
in any non-Wholly Owned Restricted Subsidiary; plus
(n)
all charges, costs, expenses, accruals or reserves in connection with the rollover, acceleration or
payout of Equity Interests held by Management Stockholders and all losses, charges and expenses related to payments
made to holders of options or other derivative Equity Interests of such Person or any direct or indirect parent thereof in
connection with, or as a result of, any distribution being made to equity holders of such Person or any direct or indirect
parent thereof, including (A) payments made to compensate such holders as though they were equity holders at the time
of, and entitled to share in, such distribution, and (B) all dividend equivalent rights owed pursuant to any compensation
or equity arrangement; plus
(o)
expenses, charges and losses resulting from the payment or accrual of indemnification or refunding
provisions, earn-outs and contingent consideration obligations, bonuses and other compensation paid to employees,
directors or consultants, and payments in respect of dissenting shares, and purchase price adjustments, in each case,
made in connection with a permitted Investment or other transaction disclosed in the documents of the type referred to
in clause (t) below; plus
(p)
any losses from abandoned, closed, disposed or discontinued operations or operations that are
anticipated to become abandoned, closed, disposed or discontinued; plus
(q)
(A) any costs or expenses (including any payroll taxes) incurred by the Issuer or any Restricted
Subsidiary in such Test Period as a result of, in connection with or pursuant to any management equity plan, profits
interest or stock option plan or any other management or employee benefit plan or agreement, any pension plan
(including (1) any post-employment benefit scheme to which the relevant pension trustee has agreed, (2) as a result of
curtailments or modifications to pension and post-retirement employee benefit plans and (3) without limitation,
compensation arrangements with holders of unvested options entered into in connection with a permitted Restricted
Payment), any stock subscription, stockholders or partnership agreement, any payments in the nature of compensation
or expense reimbursement made to independent board members, any
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employee benefit trust, any employee benefit scheme or any similar equity plan or agreement (including any deferred
compensation arrangement), including any payment made to option holders in connection with, or as a result of, any
distribution being made to, or share repurchase from, a shareholder, which payments are being made to compensate
option holders as though they were shareholders at the time of, and entitled to share in, such distribution or share
repurchase and (B) any costs or expenses incurred in connection with the rollover, acceleration or payout of Equity
Interests held by management of Holdings (or any Parent Entity, the Issuer and/or any Restricted Subsidiary); plus
(r)
the amount of loss or discount on sale of receivables, Securitization Assets and related assets to any
Securitization Subsidiary in connection with a Qualified Securitization Financing; plus
(s)
(t)
the cumulative effect of a change in accounting principles; plus
addbacks reflected in the Model in connection with the Transactions or the quality of earnings report
delivered in connection with the Transactions; plus
(u)
the amount of “run rate” cost savings, operating expense reductions and synergies that are projected
by the Issuer in good faith to result from actions taken, committed to be taken or expected to be taken no later than 36
months after the end of such Test Period (which amounts will be determined by the Issuer in good faith and calculated
on a Pro Forma Basis as though such amounts had been realized on the first day of the Test Period for which
Consolidated Adjusted EBITDA is being determined), net of the amount of actual benefits realized during such Test
Period from such actions; provided that, in the good faith judgment of the Issuer such cost savings are reasonably
identifiable, reasonably anticipated to be realized and factually supportable (it being agreed such determinations need
not be made in compliance with Regulation S-X or other applicable securities law); plus
(v)
to the extent not included in Consolidated Net Income for such period, cash actually received (or
any netting arrangement resulting in reduced cash expenditures) during such period so long as the non-cash gain
relating to the relevant cash receipt or netting arrangement was deducted in the calculation of Consolidated Adjusted
EBITDA for any previous period and not added back; plus
(w)
(x)
other assets; plus
(y)
(z)
[reserved]; plus
the amount of any contingent payments in connection with the licensing of intellectual property or
Public Company Costs; plus
the amount of fees, expense reimbursements and indemnities paid to directors and/or members of
advisory boards, including directors of Holdings or any other Parent Entity; plus
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(aa)
any net pension or other post-employment benefit costs representing amortization of unrecognized
prior service costs, actuarial losses, including amortization or such amounts arising in prior periods, amortization of the
unrecognized net obligation (and loss or cost) existing at the date of initial application of FASB Accounting Standards
Codification 715, and any other items of a similar nature; plus
(bb)
(cc)
[reserved]; plus
payments made pursuant to Earnouts; plus
(dd)
adjustments of the nature reflected in the calculation of “Adjusted EBITDA,” “Credit Adjusted
EBITDA,” “Pro Forma Credit Adjusted EBITDA” and “Adjusted EBITDA by Segment” (or similar pro forma non-
GAAP measures) as set forth in the section entitled “Summary—Summary Financial and Other Data” in the Offering
Memorandum;
(2)
decreased, without duplication, by the following items of such Person and its Restricted Subsidiaries for such
Test Period determined on a consolidated basis in accordance with GAAP (solely to the extent increasing Consolidated Net
Income):
(a)
any amount which, in the determination of Consolidated Net Income for such period, has been
included for any non-cash income or non-cash gain, all as determined in accordance with GAAP (provided that if any
non-cash income or non-cash gain represents an accrual or deferred income in respect of potential cash items in any
future period, such Person may determine not to deduct the relevant non-cash gain or income in the then-current
period); plus
(b)
the amount of any cash payment made during such period in respect of any non-cash accrual,
reserve or other non-cash charge that is accounted for in a prior period and that was added to Consolidated Net Income
to determine Consolidated Adjusted EBITDA for such prior period and that does not otherwise reduce Consolidated
Net Income for the current period; plus
(c)
the excess of actual cash rent paid over rent expense during such period due to the use of straight-
line rent for GAAP purposes; plus
(d)
amount of any income or gain associated with any Restricted Subsidiary that is attributable to any
non-controlling interest and/or minority interest of any third party; plus
(e)
(f)
any Net Income from disposed or discontinued operations; plus
any unusual, extraordinary, infrequent or non-recurring gains.
Notwithstanding the foregoing, the Consolidated Adjusted EBITDA (i) for the fiscal quarter ending September 30,
2020 shall be $87,000,000, (ii) for the fiscal quarter ending December 31, 2020 shall be $91,000,000, (iii) for the fiscal quarter
ending March 31, 2021 shall be $79,000,000 and (iv) for the fiscal quarter ending June 30, 2021 shall be $158,000,000, in each
case, as such
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amounts may be adjusted pursuant to the foregoing provisions and other pro forma adjustments permitted by the “Description of
Notes” in the Offering Memorandum (including as necessary to give Pro Forma Effect to any Specified Transaction).
“Consolidated First Lien Net Debt” means, as of any date of determination, Consolidated Secured Net Debt outstanding
(i) Incurred under the Term Loan Credit Agreement, (ii) Incurred under the ABL Credit Agreement, (iii) under the Notes or (iv)
Indebtedness that is secured by a Lien on the Collateral outstanding as of such date that is pari passu in priority with (A) the
Liens on Fixed Asset Collateral securing the obligations under the Notes or (B) the Liens on Current Asset Collateral securing the
obligations under the ABL Credit Agreement other than Capitalized Lease Obligations.
“Consolidated Net Debt” means, as of any date of determination, (a) Consolidated Total Debt minus (b) the aggregate
amount of cash and Cash Equivalents of the Issuer and the Restricted Subsidiaries as of such date that is not Restricted.
“Consolidated Net Income” means, with respect to any Person for any Test Period, the Net Income of such Person and
its Restricted Subsidiaries determined on a consolidated basis in accordance with GAAP; provided, that there shall be excluded
from such Consolidated Net Income (to the extent otherwise included therein), without duplication:
(1)
the Net Income for such Test Period of any Person that is not a Subsidiary, or is an Unrestricted Subsidiary,
or that is accounted for by the equity method of accounting; provided that the Issuer’s or any Restricted Subsidiary’s equity in the
Net Income of such Person shall be included in the Consolidated Net Income of the Issuer for such Test Period up to the
aggregate amount of dividends or distributions or other payments in respect of such equity that are actually paid in cash (or to the
extent converted into cash) by such Person to the Issuer or a Restricted Subsidiary, in each case, in such Test Period, to the extent
not already included therein (subject in the case of dividends, distributions or other payments in respect of such equity made to a
Restricted Subsidiary to the limitations contained in clause (2) below);
(2)
solely with respect to the calculation of Cumulative Credit, the Net Income of any Restricted Subsidiary of
such Person during such Test Period to the extent that the declaration or payment of dividends or similar distributions by such
Restricted Subsidiary of that income is not permitted by operation of the terms of its Organization Documents or any agreement,
instrument or requirement of Law applicable to such Restricted Subsidiary during such Test Period; provided that Consolidated
Net Income of such Person shall be increased by the amount of dividends or distributions or other payments that are actually paid
in cash to such Person or its Restricted Subsidiaries in respect of such Test Period;
(3)
any gain (or loss), together with any related provisions for taxes on any such gain (or the tax effect of any
such loss), realized by such Person or any of its Restricted Subsidiaries during such Test Period upon any asset sale or other
disposition of any Equity Interests of any Person (other than any dispositions in the ordinary course of business) by such Person
or any of its Restricted Subsidiaries;
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(4)
gains and losses due solely to fluctuations in currency values and the related tax effects determined in
accordance with GAAP for such Test Period;
(5)
earnings (or losses), including any impairment charge, resulting from any reappraisal, revaluation or write-up
(or write-down) of assets during such Test Period;
(6)
(i) unrealized gains and losses with respect to Hedge Agreements for such Test Period and the application of
Accounting Standards Codification 815 (Derivatives and Hedging) and (ii) any after-tax effect of income (or losses) for such Test
Period that result from the early extinguishment of (A) Indebtedness, (B) obligations under any Hedge Agreements or (C) other
derivative instruments;
(7)
any extraordinary, infrequent, non-recurring or unusual gain (or extraordinary, infrequent, non-recurring or
unusual loss), together with any related provision for taxes on any such gain (or the tax effect of any such loss), recorded or
recognized by such Person or any of its Restricted Subsidiaries during such Test Period;
(8)
the cumulative effect of a change in accounting principles and changes as a result of the adoption or
modification of accounting policies during such Test Period;
(9)
after-tax gains (or losses) on disposal of disposed, abandoned or discontinued operations for such Test
Period;
(10)
effects of adjustments (including the effects of such adjustments pushed down to such Person and its
Restricted Subsidiaries) in the inventory, property and equipment, software, goodwill, other intangible assets, in-process research
and development, deferred revenue, debt and unfavorable or favorable lease line items in such Person’s consolidated financial
statements pursuant to GAAP for such Test Period resulting from the application of purchase accounting in relation to the
Transactions or any acquisition consummated prior to the Merger Date and any acquisition or other Investment or the
amortization or write-off of any amounts thereof, net of taxes, for such Test Period;
(11)
any non-cash compensation charge or expense for such Test Period, including any such charge or expense
arising from the grants of stock appreciation or similar rights, stock options, restricted stock or other rights and any cash charges
or expenses associated with the rollover, acceleration or payout of Equity Interests by, or to, management of such Person or any
of its Restricted Subsidiaries in connection with the Transactions;
(12)
(i) Transaction Expenses incurred during such Test Period and (ii) any fees and expenses incurred during
such Test Period, or any amortization thereof for such Test Period, in connection with any acquisition (other than the
Transactions), Investment, disposition, issuance or repayment of Indebtedness, issuance of Equity Interests, refinancing
transaction or amendment or modification of any debt or equity instrument (in each case, including any such transaction whether
consummated on, after or prior to the Issue Date and any such transaction undertaken but not completed) and any charges or non-
recurring costs incurred during such Test Period as a result of any such transaction;
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(13)
any expenses, charges or losses for such Test Period that are covered by indemnification or other
reimbursement provisions in connection with any Investment, acquisition or any sale, conveyance, transfer or other disposition of
assets permitted under this Indenture, to the extent actually reimbursed, or, so long as the Issuer has made a determination that a
reasonable basis exists for indemnification or reimbursement and only to the extent that such amount is in fact indemnified or
reimbursed within 365 days of such determination (with a deduction in the applicable future period for any amount so added back
to the extent not so indemnified or reimbursed within such 365 days); and
(14)
to the extent covered by insurance and actually reimbursed, or, so long as the Issuer has made a
determination that there exists reasonable evidence that such amount will in fact be reimbursed within 365 days of the date of
such determination (with a deduction in the applicable future period for any amount so added back to the extent not so
reimbursed within such 365 days), expenses, charges or losses for such Test Period with respect to liability or casualty events or
business interruption.
“Consolidated Secured Net Debt” means, as of any date of determination, Consolidated Net Debt that is secured by a
Lien on the Collateral outstanding as of such date, other than Capitalized Lease Obligations.
“Consolidated Total Debt” means, as of any date of determination, the aggregate principal amount of third party
Indebtedness of the Issuer and the Restricted Subsidiaries outstanding on such date, determined on a consolidated basis and as
reflected on the face of a balance sheet prepared in accordance with GAAP (but excluding the effects of the application of
purchase accounting in connection with the Transactions, an acquisition or any other Investment permitted under this Indenture),
consisting of Indebtedness for borrowed money, unreimbursed obligations in respect of drawn letters of credit (to the extent not
cash collateralized), and obligations in respect of Capitalized Leases and purchase money obligations and debt obligations
evidenced by promissory notes or debentures; provided, that Consolidated Total Debt will not include Indebtedness in respect of
(a) any Qualified Securitization Financing, (b) any letter of credit, except to the extent of unreimbursed obligations in respect of
drawn letters of credit (provided, that any unreimbursed amount under commercial letters of credit will not be counted as
Consolidated Total Debt until three Business Days after such amount is drawn (it being understood that any borrowing, whether
automatic or otherwise, to fund such reimbursement will be counted)), (c) obligations under Hedge Agreements, (d) obligations
in respect of cash management obligations, (e) purchase money obligations incurred in the ordinary course, trade payable and
earn outs and similar obligations, (f) Indebtedness to the extent it has been cash collateralized and (g) any lease obligations other
than in respect of Capitalized Leases.
“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.
“Contribution Indebtedness” means Indebtedness in an aggregate principal amount at the time of Incurrence thereof
and after giving Pro Forma Effect thereto not to exceed 200.0% of the amount of any cash capital contributions and Net Proceeds
from the sale of Equity Interests received by Holdings or any other Parent Entity and contributed to the Issuer as equity solely in
19
exchange for Qualified Equity Interests of the Issuer during the period from and including the Business Day immediately
following the Issue Date through and including the date of such Incurrence that are Not Otherwise Applied.
“Control” has the meaning assigned to such term in the definition of “Affiliate.”
“Corporate Trust Office” means the designated office of the Trustee or Collateral Agent, as the case may be, in the
United States specified in Section 14.02 at which at any time its corporate trust business shall be administered, or such other
address as the Trustee or Collateral Agent, as the case may be, may designate from time to time by notice to the holders and the
Issuer, or the principal corporate trust office of any successor Trustee or Collateral Agent, as the case may be (or such other
address as such successor Trustee or Collateral Agent, as the case may be, may designate from time to time by notice to the
holders and the Issuer).
“Credit Agreement Documents” means the collective reference to any Credit Agreement, any notes issued pursuant
thereto and the guarantees thereof, and the collateral documents relating thereto, as amended, supplemented, restated, renewed,
refunded, replaced, restructured, repaid, refinanced or otherwise modified, in whole or in part, from time to time.
“Credit Agreements” means the ABL Credit Agreement and the Term Loan Credit Agreement.
“Cumulative Credit” means the sum of (without duplication):
(1)
an amount equal to 50.0% of Consolidated Net Income of the Issuer for the period (taken as one accounting
period) commencing on the first day of the fiscal quarter in which the Merger Date occurs to the end of the Issuer’s most recently
ended fiscal quarter for which internal financial statements are available (which amount shall not be less than zero in any fiscal
quarter), plus
(2)
100% of the aggregate net proceeds, including cash and the Fair Market Value (as determined in good faith
by the Issuer) of property other than cash, received by the Issuer after the Merger Date (other than net proceeds to the extent such
net proceeds have been used to Incur Indebtedness, Disqualified Stock, or Preferred Stock pursuant to Section 4.03(2)(m)) from
the issue or sale of Equity Interests of the Issuer or any Parent Entity (excluding Refunding Capital Stock (as defined below),
Designated Preferred Stock, Excluded Contributions, and Disqualified Stock), including Equity Interests issued upon exercise of
warrants or options (other than an issuance or sale to the Issuer or a Restricted Subsidiary), plus
(3)
100% of the aggregate amount of contributions to the capital of the Issuer, other than from a Restricted
Subsidiary, received in cash and the Fair Market Value (as determined in good faith by the Issuer) of property other than cash
after the Merger Date and, without duplication, cash and the Fair Market Value (as determined in good faith by the Issuer) of
property other than cash that becomes part of the capital of the Issuer through consolidation or merger after the Merger Date
(other than Excluded Contributions, Refunding Capital Stock, Designated Preferred Stock, and Disqualified Stock and other than
contributions to the extent such contributions have been used to Incur Indebtedness, Disqualified Stock, or Preferred Stock
pursuant to Section 4.03(2)(m), plus
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(4)
100% of the principal amount of any Indebtedness, or the liquidation preference or maximum fixed
repurchase price, as the case may be, of any Disqualified Stock of the Issuer or any Restricted Subsidiary (other than
Indebtedness or Disqualified Stock issued to a Restricted Subsidiary), in each case, issued or Incurred after the Merger Date,
which has been cancelled or converted into or exchanged for Equity Interests in the Issuer (other than Disqualified Stock) or any
Parent Entity (provided, in the case of any such parent, such Indebtedness or Disqualified Stock is retired or extinguished), plus
(5)
100% of the aggregate amount received by the Issuer or any Restricted Subsidiary in cash and the Fair
Market Value (as determined in good faith by the Issuer) of property other than cash received by the Issuer or any Restricted
Subsidiary from:
(A)
the sale or other disposition (other than to the Issuer or a Restricted Subsidiary) of, or other returns
on Investments from, Restricted Investments made by the Issuer and the Restricted Subsidiaries and from repurchases
and redemptions of such Restricted Investments from the Issuer and the Restricted Subsidiaries by any Person (other
than the Issuer or any Restricted Subsidiary) and from repayments of loans or advances, and releases of guarantees,
which constituted Restricted Investments made by the Issuer or any Restricted Subsidiary after the Merger Date,
(B)
the sale (other than to the Issuer or a Restricted Subsidiary) of the Capital Stock of a Minority
Investment or an Unrestricted Subsidiary, other than to the extent the Investment in such Unrestricted Subsidiary was
made in reliance on a clause of the definition of “Permitted Investment”, or
(C)
a distribution or dividend from any Minority Investment or an Unrestricted Subsidiary, other than
to the extent the Minority Investment or the Investment in such Unrestricted Subsidiary was made in reliance on a
clause of the definition of “Permitted Investment”, plus
(6)
in the event any Unrestricted Subsidiary has been re-designated as a Restricted Subsidiary or has been
merged, consolidated or amalgamated with or into, or transfers or conveys its assets to, or is liquidated into, the Issuer or a
Restricted Subsidiary, the Fair Market Value (as determined in good faith by the Issuer) of the Investment of the Issuer or the
Restricted Subsidiaries in such Unrestricted Subsidiary at the time of such re-designation, combination or transfer (or of the
assets transferred or conveyed, as applicable), other than to the extent the Investment in such Unrestricted Subsidiary was made
in reliance on a clause of the definition of “Permitted Investment”, plus
(7)
(8)
100% of the aggregate amount of Retained Declined Proceeds, plus
the greater of (I) 25.0% of Closing Date EBITDA and (II) 25.0% of TTM Consolidated Adjusted EBITDA
as of the applicable date of determination;
provided that the Cumulative Credit shall not be available for Restricted Payments pursuant to clauses (1) and (2) of the
definition thereof until on and after the date that is 24 months after the Merger Date.
21
“Current Asset Collateral” has the meaning assigned to the term “ABL Collateral” in the ABL Intercreditor Agreement.
“Default” means any event or condition that constitutes an Event of Default or that, with the giving of any notice, the
passage of time, or both, would be an Event of Default.
“Derivative Instrument” with respect to a Person, means any contract, instrument or other right to receive payment or
delivery of cash or other assets to which such Person or any Affiliate of such Person that is acting in concert with such Person in
connection with such Person’s investment in the Notes (other than a Regulated Bank or a Screened Affiliate) is a party (whether
or not requiring further performance by such Person), the value and/or cash flows of which (or any material portion thereof) are
materially affected by the value and/or performance of the Notes and/ or the creditworthiness of the Issuer and/or any one or
more of the Guarantors (the “Performance References”).
“Designated Non-Cash Consideration” means the Fair Market Value (as determined in good faith by the Issuer) of non-
cash consideration received by the Issuer or a Restricted Subsidiary in connection with an Asset Sale that is so designated as
Designated Non-Cash Consideration by the Issuer (which amount will be reduced by the Fair Market Value of the portion of the
non-cash consideration converted to cash within 180 days following the consummation of the applicable Asset Sale).
“Designated Preferred Stock” means Preferred Stock of the Issuer or any Parent Entity (other than Disqualified Stock),
that is issued for cash (other than to the Issuer or any of its Subsidiaries or an employee stock ownership plan or trust established
by the Issuer or any of its Subsidiaries) and is so designated as Designated Preferred Stock, pursuant to an Officer’s Certificate,
on the issuance date thereof.
“Disinterested Director” means, with respect to any Affiliate Transaction, a member of the Board of Directors of the
Issuer (or a Parent Entity, as the case may be) having no material direct or indirect financial interest in or with respect to such
Affiliate Transaction. A member of the Board of Directors of the Issuer (or such Parent Entity) shall be deemed not to have such
a financial interest by reason of such member’s holding Capital Stock of the Issuer or a parent entity of the Issuer or any options,
warrants or other rights in respect of such Capital Stock.
“Disqualified Stock” means, with respect to any Person, any Capital Stock of such Person which, by its terms (or by the
terms of any security or other Equity Interests into which it is convertible or for which it is redeemable or exchangeable), or upon
the happening of any event or condition:
(1)
matures or is mandatorily redeemable (other than solely for Qualified Equity Interests), pursuant to a sinking
fund obligation or otherwise (except as a result of a change of control or asset sale),
(2)
is or becomes convertible or exchangeable for Indebtedness or Disqualified Stock of such Person or any of
its Restricted Subsidiaries, or
22
(3)
is redeemable at the option of the holder thereof (other than solely for Qualified Equity Interests), in whole
or in part,
in each case prior to 91 days after the earlier of the maturity date of the Notes or the date the Notes are no longer outstanding;
provided, however, that only the portion of Capital Stock which so matures or is mandatorily redeemable, is so convertible or
exchangeable or is so redeemable at the option of the holder thereof prior to such date shall be deemed to be Disqualified Stock;
provided, further, however, that if such Capital Stock is issued to any Company Person or to any plan for the benefit of any
Company Person of a Parent Entity, the Issuer or its Subsidiaries or by any such plan to such Company Person, such Capital
Stock shall not constitute Disqualified Stock solely because it may be required to be repurchased by such Person in order to
satisfy applicable statutory or regulatory obligations or as a result of such Company Person’s termination, death or disability;
provided, further, that any class of Capital Stock of such Person that by its terms authorizes such Person to satisfy its obligations
thereunder by delivery of Capital Stock that is not Disqualified Stock shall not be deemed to be Disqualified Stock.
“Dividing Person” has the meaning assigned to such term in the definition of “Division.”
“Division” means the division of the assets, liabilities and/or obligations of a Person (the “Dividing Person”) among
two or more Persons (whether pursuant to a “plan of division” or similar arrangement), which may or may not include the
Dividing Person and pursuant to which the Dividing Person may or may not survive.
“Division Successor” means any Person that, upon the consummation of a Division of a Dividing Person, holds all or
any portion of the assets, liabilities and/or obligations previously held by such Dividing Person immediately prior to the
consummation of such Division. A Dividing Person which retains any of its assets, liabilities and/or obligations after a Division
shall be deemed a Division Successor upon the occurrence of such Division.
“Domestic Subsidiary” means any Subsidiary that is organized under the Laws of the United States, any state thereof or
the District of Columbia.
“Earnouts” means (a) all earnout payments or other contingent payments in connection with any Permitted Investment
and (b) Existing Earnouts and Unfunded Holdbacks.
“Equity Interests” means, with respect to any Person, all of the shares, interests, rights, participations or other
equivalents (however designated) of Capital Stock of (or other ownership or profit interests or units in, including any limited or
general partnership interest and any limited liability company membership interest) such Person and all of the warrants, options
or other rights for the purchase, acquisition or exchange from such Person of any of the foregoing (including through convertible
securities).
“Equity Offering” means any public or private sale of common Capital Stock or Preferred Stock of the Issuer or any
Parent Entity, as applicable (other than Disqualified Stock), other than:
(1)
public offerings with respect to the Issuer’s or such Parent Entity’s common stock registered on Form S-4 or
Form S-8;
23
(2)
(3)
issuances to any Subsidiary of the Issuer; and
any such public or private sale that constitutes an Excluded Contribution.
Notwithstanding the foregoing, an “Equity Offering” under this definition shall include the merger of the Issuer or any
Parent Entity into a person that has, or whose direct or indirect parent has, previously consummated a public Equity Offering (as
defined in this Indenture but replacing the Issuer with such person).
“Escrow Agent” means The Bank of New York Mellon, as escrow agent under the Escrow Agreement.
“Escrow Issuer” has the meaning set forth in the preamble hereto.
“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC
promulgated thereunder.
“Excluded Assets” has the meaning assigned to such term in the Security Agreement.
“Excluded Contributions” means the Cash Equivalents or other assets (valued at their Fair Market Value as determined
in good faith by the Board of Directors of the Issuer (or a Parent Entity) or the senior management of the Issuer (or a Parent
Entity)) received by the Issuer after the Issue Date from:
(1)
contributions to its common equity capital, and
(2)
the sale (other than to a Subsidiary of the Issuer or to any Subsidiary management equity plan or stock option
plan or any other management or employee benefit plan or agreement) of Equity Interests (other than Disqualified Stock and
Designated Preferred Stock) of the Issuer,
in each case designated as Excluded Contributions pursuant to an Officer’s Certificate.
“Excluded Equity Interests” means any Equity Interests held by the Issuer or a Guarantor that comprise any of the
following:
(1)
more than 65.0% of the issued and outstanding Capital Stock (other than non-voting Capital Stock) of (i)
each Subsidiary that is a Foreign Subsidiary and a CFC and (ii) each Subsidiary that is a FSHCO, and all of the issued and
outstanding Capital Stock of any Subsidiary of a Foreign Subsidiary that is a CFC or a FSHCO;
(2)
(a) any Equity Interests of any Person that is not a direct Wholly Owned Subsidiary of Holdings, the Issuer
or any other Guarantor or (b) any Equity Interests in any other Person (other than a direct or indirect Wholly Owned Material
Subsidiary of Holdings, the Issuer or any Guarantor), in each case, to the extent (x) the organizational documents or other
agreements with respect to such Equity Interests with other equity holders prohibits or restricts the pledge of such Capital Stock,
(y) the pledge of such Capital Stock is otherwise prohibited or restricted by (i) applicable law, rule or regulation which would
require governmental (including regulatory) consent, approval, license or authorization to be pledged or that would require
consent under any
24
contractual obligation existing on the Merger Date or on the date any Subsidiary is acquired (so long as, in respect of such
contractual obligation, such prohibition is not incurred in contemplation of such acquisition and except to the extent such
prohibition is overridden by anti-assignment provisions of the Uniform Commercial Code of any applicable jurisdiction) or (ii)
any agreement with a third party (other than Holdings, the Issuer or any of the Restricted Subsidiaries) (provided that any such
Equity Interests shall cease to be Excluded Equity Interests at such time as such prohibition or restriction ceases to be in effect) or
(z) would result in a change of control, repurchase obligation or other adverse consequence (in each case, except to the extent that
any such prohibition or restriction would be rendered ineffective under the Uniform Commercial Code or other applicable Law or
principle of equity);
(3)
any margin stock;
(4)
any Equity Interest, if the pledge thereof or the security interest therein would result in material adverse tax
consequences to the Issuer or any Guarantor as reasonably determined in good faith by the Issuer and notified in writing to the
Collateral Agent; provided that such assets do not secure (or purport to secure) any other Parity Lien Obligations;
(5)
Equity Interest in each Unrestricted Subsidiary or Immaterial Subsidiary;
(6)
any Equity Interest with respect to which those assets as to which the ABL Collateral Agent (in the case of
Current Asset Collateral) or the Term Loan Collateral Agent (in the case of Fixed Asset Collateral) has determined (in its
reasonable judgment in consultation with the Issuer) that the costs of pledging, perfecting or maintaining the pledge in respect of
such Capital Stock exceeds the Fair Market Value thereof or the practical benefit to the secured parties afforded (or proposed to
be afforded) thereby and notified in writing to the Collateral Agent; provided that such assets do not secure (or purport to secure)
any other Parity Lien Obligations or ABL Obligations; and
(7)
any Equity Interests otherwise constituting an Excluded Asset;
provided, however, that Excluded Equity Interests will not include any proceeds, substitutions or replacements of any
Excluded Equity Interests (unless such proceeds, substitutions or replacements would otherwise constitute Excluded Equity
Interests).
“Excluded Subsidiary” means: (a) any Subsidiary that is not a Wholly Owned Subsidiary of Holdings, the Issuer or any
of their respective Subsidiaries; (b) any Foreign Subsidiary of the Issuer or of any direct or indirect Domestic Subsidiary or
Foreign Subsidiary; (c) any FSHCO; (d) any Domestic Subsidiary that is a direct or indirect Subsidiary of a Foreign Subsidiary
that is a CFC; (e) any Subsidiary that is prohibited or restricted by applicable Law from providing a Guarantee or by a binding
Contractual Obligation existing on the Merger Date or at the time of the acquisition of such Subsidiary (and not Incurred in
contemplation of such acquisition) from providing a Guarantee (provided that such Contractual Obligation is not entered into by
the Issuer or its Restricted Subsidiaries principally for the purpose of qualifying as an “Excluded Subsidiary” under this
definition) or if such Guarantee would require governmental (including regulatory) or third party (other than Holdings, the Issuer
or a Restricted Subsidiary) consent, approval, license or authorization, unless such consent, approval, license or authorization has
been obtained; (f) any
25
special purpose securitization vehicle (or similar entity) including any Securitization Subsidiary created pursuant to a transaction
permitted under this Indenture; (g) any Subsidiary that is a not-for-profit organization; (h) any Captive Insurance Subsidiary;
(i) any other Subsidiary with respect to which, in the reasonable judgment of the Issuer, the cost or other consequences (including
any material adverse tax consequences) of providing the Guarantee shall be excessive in view of the benefits to be obtained by
the holders therefrom; (j) any other Subsidiary to the extent the provision of a guarantee by such Subsidiary would result in
material adverse tax consequences to Holdings (or any Parent Entity to the extent such material adverse tax consequences are
related to its ownership of the Equity Interests in Holdings or the Issuer and its Restricted Subsidiaries), the Issuer or any of the
Restricted Subsidiaries as reasonably determined by the Issuer in good faith; (k) any Unrestricted Subsidiary; and (l) any
Immaterial Subsidiary; provided that the Issuer, in its sole discretion, may cause any Restricted Subsidiary that is a Domestic
Subsidiary or a Canadian Subsidiary (or any other Restricted Subsidiary) that qualifies as an Excluded Subsidiary under clauses
(a) through (l) above to become a Subsidiary Guarantor in accordance with the definition thereof and thereafter such Subsidiary
shall not constitute an “Excluded Subsidiary” (unless and until the Issuer elects, in its sole discretion to designate such Subsidiary
as an Excluded Subsidiary so long as such Subsidiary otherwise qualifies as an Excluded Subsidiary at the time of such
designation).
“Exempted Indebtedness” means, as of any particular time, all then outstanding Indebtedness of the Issuer and
Principal Property Subsidiaries Incurred after the Issue Date and secured by any mortgage, security interest, pledge or Lien other
than those permitted by Section 4.12(b) herein.
“Existing Earnouts and Unfunded Holdbacks” shall mean those earnouts and unfunded holdbacks existing on the
Merger Date.
“Existing Notes” means all senior notes issued and outstanding under that certain Senior Indenture, dated as of
November 19, 2007 (as supplemented and amended, the “Existing Notes Indenture”), among the Company, the subsidiary
guarantors party thereto and The Bank of New York Mellon (as successor to The Bank of New York), as trustee.
“Existing Notes Change of Control Offers” means any “change of control offer” for one or both series of the Existing
Notes that is required following the closing of the Merger pursuant to Section 1201 of the Existing Notes Indenture.
“Existing Notes Indenture” has the meaning assigned to such term in the definition of “Existing Notes.”
“Fair Market Value” means, with respect to any asset or property, the price which could be negotiated in an arm’s-
length transaction, for cash, between a willing seller and a willing and able buyer, neither of whom is under undue pressure or
compulsion to complete the transaction, which, in the case of an Asset Sale, Restricted Payment or Investment shall be
determined either, at the option of the Issuer, at the time of the Asset Sale, Restricted Payment or Investment or as of the
Transaction Test Date with respect to such Asset Sale, Restricted Payment or Investment, and without giving effect to any
subsequent change in value. Any determination of Fair Market Value
26
that is consistent with a valuation or opinion of an Independent Financial Advisor shall be conclusive for all purposes under this
Indenture.
“First Lien Net Leverage Ratio” means, with respect to any Test Period, the ratio of (a) Consolidated First Lien Net
Debt outstanding as of the last day of such Test Period to (b) Consolidated Adjusted EBITDA of the Issuer for such Test Period.
“Fitch” means Fitch Ratings, Inc. or any successor to the rating agency business thereof.
“Fixed Asset Collateral” has the meaning assigned to such term in the ABL Intercreditor Agreement.
“Fixed GAAP Date” means the Issue Date; provided that at any time after the Issue Date, the Issuer may by written
notice to the Trustee elect to change the Fixed GAAP Date with respect to any (or all) Fixed GAAP Term(s) to be the date
specified in such notice, and upon such notice, such Fixed GAAP Date shall be such date for all periods beginning on and after
the date specified in such notice.
“Fixed GAAP Terms” means (a) the definitions of the terms “Capitalized Lease Obligation,” “Capitalized Leases,”
“Consolidated Adjusted EBITDA,” “Consolidated Net Income,” “Consolidated Total Debt,” “First Lien Net Leverage Ratio,”
“Indebtedness,” “Secured Net Leverage Ratio,” “Total Assets,” and “Total Net Leverage Ratio” and including without limitation
any future changes in GAAP that would require lease (or “synthetic lease”) obligations to be included as Indebtedness on the
Issuer’s balance sheet, (b) all defined terms in this Indenture to the extent used in or relating to any of the foregoing definitions,
and all ratios and computations based on any of the foregoing definitions, and (c) any other term or provision of this Indenture or
the Notes that, at the Issuer’s election, may be specified by the Issuer by written notice to the Trustee from time to time; provided
that the Issuer may elect to remove any term from constituting a Fixed GAAP Term or add any term as a Fixed GAAP Term.
“Fixed Incremental Amount” means, as of the date of measurement, the sum of (i) greater of (x) 50.0% of Closing Date
EBITDA and (y) 50.0% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination plus (ii) the
aggregate principal amount of any voluntary prepayments, redemptions and repurchases (including amounts paid pursuant to
“yank-a-bank” provisions with credit given to the amount actually paid in cash, if acquired below par) of Indebtedness incurred
under the Term Loan Credit Agreement, the ABL Credit Agreement, or any Indebtedness secured on a pari passu basis with the
Term Loan Credit Agreement, ABL Obligations on the Current Asset Collateral, this Indenture and other agreements governing
Secured Indebtedness, in each case except to the extent such prepayments, redemptions and repurchases were funded with the
proceeds of long-term Indebtedness of the Issuer or its Restricted Subsidiaries (and in the case of any revolving commitments, as
long as there is a permanent reduction in such commitments).
“Foreign Subsidiary” means any direct or indirect Subsidiary of the Issuer that is not a Domestic Subsidiary.
27
“FSHCO” means any direct or indirect Domestic Subsidiary of Holdings (other than the Issuer) that has no material
assets other than Equity Interests (or Equity Interests and Indebtedness) in one or more Foreign Subsidiaries that are CFCs or
other FSHCOs.
“GAAP” means generally accepted accounting principles in the United States set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements
and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been
approved by a significant segment of the accounting profession, as in effect on the Fixed GAAP Date (for purposes of the Fixed
GAAP Terms) and as in effect from time to time (for all other purposes of this Indenture); provided that the Issuer may at any
time and from time to time elect by written notice to the Trustee to use IFRS in lieu of GAAP for financial reporting purposes
and/or with respect to any (or all) Fixed GAAP Term(s) and, upon any such notice, references herein to GAAP shall thereafter be
construed to mean (a) for periods beginning on and after the date specified in such notice, IFRS as in effect on the date specified
in such notice (for purposes of any such Fixed GAAP Terms) and as in effect from time to time (for all other purposes of this
Indenture) and (b) for prior periods, GAAP as defined in the first sentence of this definition. For the purposes of this Indenture,
the term “consolidated” with respect to any Person shall mean such Person consolidated with its Restricted Subsidiaries, and shall
not include any Unrestricted Subsidiary, but the interest of such Person in an Unrestricted Subsidiary will be accounted for as an
Investment.
“Governmental Authority” means the government of the United States or any other nation, or of any political
subdivision thereof, whether state, provincial, territorial, municipal, local or foreign, and any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative
powers or functions of or pertaining to government (including any supra-national bodies such as the European Union or the
European Central Bank).
“guarantee” means a guarantee (other than by endorsement of negotiable instruments for collection in the ordinary
course of business), direct or indirect, in any manner (including, without limitation, letters of credit and reimbursement
agreements in respect thereof), of all or any part of any Indebtedness or other obligations. The amount of any guarantee shall be
deemed to be an amount equal to the stated or determinable amount of the Indebtedness in respect of which such guarantee is
made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by such
person in good faith.
“Guarantee” means any guarantee of the obligations of the Issuer under this Indenture and the Notes by any Guarantor
in accordance with the provisions of this Indenture.
“Guarantors” means, collectively, the Subsidiary Guarantors, Holdings and each other Parent Entity that Incurs a
Guarantee; provided that upon the release or discharge of such Person from its Guarantee in accordance with this Indenture, such
Person ceases to be a Guarantor.
“Hedge Agreement” means any agreement with respect to (a) any and all rate swap transactions, basis swaps, credit
derivative transactions, forward rate transactions, commodity swaps, commodity options, forward commodity contracts, equity or
equity index swaps or options, bond or bond price or bond index swaps or options or forward bond or forward bond price or
28
forward bond index transactions, interest rate options, forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap transactions, currency options, spot contracts, or any
other similar transactions or any combination of any of the foregoing (including any options to enter into any of the foregoing),
whether or not any such transaction is governed by or subject to any master agreement, and (b) any and all transactions of any
kind, and the related confirmations, which are subject to the terms and conditions of, or governed by, any form of master
agreement published by the International Swaps and Derivatives Association, Inc., any International Foreign Exchange Master
Agreement, or any other master agreement (any such master agreement, together with any related schedules, a “Master
Agreement”), including any such obligations or liabilities under any Master Agreement.
“holder” or “noteholder” means the Person in whose name a Note is registered on the registrar’s books.
“Holdings” means Pearl Excellence Holdco L.P., a Delaware limited partnership, together with its successors and
assigns.
Board.
“IFRS” means the International Financial Reporting Standards as issued by the International Accounting Standards
“Immaterial Subsidiary” means any Restricted Subsidiary of the Issuer other than a Material Subsidiary.
“Incur” means issue, assume, guarantee, incur or otherwise become liable for; provided, however, that any Indebtedness
or Capital Stock of a Person existing at the time such person becomes a Subsidiary (whether by merger, amalgamation,
consolidation, acquisition or otherwise) shall be deemed to be Incurred by such Person at the time it becomes a
Subsidiary. “Incurred” and “Incurrence” have the correlative meaning thereto.
“Indebtedness” means, with respect to any Person, without duplication, (a) any indebtedness (including principal or
premium) of such Person in respect of borrowed money; any indebtedness evidenced by bonds, notes, debentures or similar
instruments; letters of credit or banker’s acceptances (or, without double counting, reimbursement agreements in respect thereof),
and Capitalized Lease Obligations or the balance deferred and unpaid of the purchase price of any property to the extent that the
same would be required to be shown as a long-term liability on the balance sheet for such Person prepared in accordance with
GAAP, (b)(i) to the extent not otherwise included, any guarantee by such Person of obligations of the type referred to in clause
(a) of another Person (whether or not such items would appear upon the balance sheet of such obligor or guarantor), other than by
endorsement of negotiable instruments for collection in the ordinary course of business and (ii) to the extent not otherwise
included, the obligations of the type referred to in clause (a) of another Person secured by a Lien on any property owned by such
Person (other than Permitted Liens), whether or not such obligations are assumed by such Person and whether or not such
obligations would appear upon the balance sheet of such Person; provided that the amount of such Indebtedness for purposes of
this clause (ii) will be the lesser of the Fair Market Value of such property at such date of determination and the amount of
Indebtedness so secured, (c) net obligations of such Person under any Hedge Agreement to the extent such obligations would
appear as a net liability on a balance sheet of such Person (other than in the footnotes) prepared in
29
accordance with GAAP, and (d) all obligations of such Person in respect of Disqualified Stock; provided that, notwithstanding the
foregoing, Indebtedness will be deemed not to include (1) contingent obligations incurred in the ordinary course of business
unless and until such obligations are non-contingent, (2) trade payables, (3) earn-outs, purchase price holdbacks or similar
obligations, (4) intercompany liabilities in the ordinary course of business, (5) Permitted Liens, (6) Indebtedness of any Parent
Entity appearing on the balance sheet of such Person solely by reason of push down accounting under GAAP and (7) lease
obligations other than in respect of a Capitalized Lease. The amount of any net obligation under any Hedge Agreement on any
date shall be deemed to be the Swap Termination Value thereof as of such date.
“Independent Financial Advisor” means an accounting, appraisal or investment banking firm or consultant, in each case
of nationally recognized standing, that is, in the good faith judgment of the Issuer, qualified to perform the task for which it has
been engaged and that is independent of the Issuer and its Affiliates.
“insolvency or liquidation proceeding” means:
(1)
any case or proceeding commenced by or against the Issuer or any Guarantor under the Bankruptcy Code or
any similar federal, state, provincial, territorial or foreign law for the relief of debtors or relating to insolvency, any other case or
proceeding for the reorganization, arrangement, recapitalization, winding-up, liquidation, foreclosure upon or adjustment or
marshalling of the assets or liabilities of the Issuer or any Guarantor, any receivership or assignment for the benefit of creditors
relating to the Issuer or any Guarantor or any similar case or proceeding relative to the Issuer or any other Guarantor or its
respective creditors, as such, in each case whether or not voluntary; or
(2)
any liquidation, dissolution, marshalling of assets or liabilities or other winding up of or relating to the Issuer
or any Guarantor, in each case whether or not voluntary and whether or not involving bankruptcy or insolvency; provided that the
liquidation or dissolution of any Subsidiary that is not prohibited by and does not require consent under any of the Parity Lien
Documents shall not be considered an insolvency or liquidation proceeding.
“Intercreditor Agreements” means the ABL Intercreditor Agreement and the Pari Passu Intercreditor Agreement.
“Interest Payment Date” has the meaning set forth in Exhibit A hereto.
“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s or BBB- (or the
equivalent) by S&P (in each case without regard for any potential downgrade or “downgrade watch”), or an equivalent rating by
any other Rating Agency.
“Investment Grade Securities” means:
(1)
securities issued or directly and fully guaranteed or insured by the U.S. or Canadian government or any
agency or instrumentality thereof (other than Cash Equivalents),
30
(2)
securities that have a rating equal to or higher than Baa3 (or equivalent) by Moody’s and BBB- (or
equivalent) by S&P, but excluding any debt securities or loans or advances between and among the Issuer and its Subsidiaries,
(3)
investments in any fund that invests exclusively in investments of the type described in clauses (a) and (b)
which fund may also hold immaterial amounts of cash pending investment and/or distribution, and
(4)
corresponding instruments in countries other than the United States customarily utilized for high quality
investments and in each case with maturities not exceeding two years from the date of acquisition.
“Investments” means, with respect to any Person, all investments by such Person in other Persons (including Affiliates)
in the form of loans (including guarantees of loans), advances or capital contributions (excluding accounts receivable, trade credit
and advances to customers and commission, travel and similar advances to officers, employees and consultants made in the
ordinary course of business and any assets or securities received in satisfaction or partial satisfaction thereof from financially
troubled account debtors to the extent reasonably necessary in order to prevent or limit loss and any prepayments and other
credits to suppliers made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness,
Equity Interests or other securities issued by any other Person and investments that are required by GAAP to be classified on the
balance sheet of such Person in the same manner as the other investments included in this definition to the extent such
transactions involve the transfer of cash or other property; provided that none of the following shall constitute an Investment (i)
intercompany advances between and among the Issuer and its Restricted Subsidiaries relating to their cash management, tax and
accounting operations in the ordinary course of business and (ii) intercompany loans, advances or Indebtedness between and
among the Issuer and its Restricted Subsidiaries having a term not exceeding 364 days and made in the ordinary course of
business. For purposes of the definition of “Unrestricted Subsidiary” and Section 4.04 herein:
(1)
“Investments” shall include the portion (proportionate to the Issuer’s Equity Interest in such Subsidiary) of
the Fair Market Value (as determined in good faith by the Issuer) of the net assets of a Subsidiary of the Issuer at the time that
such Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation of such Subsidiary as a
Restricted Subsidiary, the Issuer shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary
equal to an amount (if positive) equal to:
(a)
the Issuer’s “Investment” in such Subsidiary at the time of such redesignation, less
(b)
the portion (proportionate to the Issuer’s Equity Interest in such Subsidiary) of the Fair Market
Value (as determined in good faith by the Issuer) of the net assets of such Subsidiary at the time of such redesignation;
and
(2)
any property transferred to or from an Unrestricted Subsidiary shall be valued at its Fair Market Value (as
determined in good faith by the Issuer) at the time of such transfer, in each
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case as determined in good faith by the Board of Directors or senior management of the Issuer (or a Parent Entity).
“Issue Date” means the date on which the initial Notes are originally issued.
“Issuer” has the meaning set forth in the preamble hereto.
“Jackson Wijaya” means (a) Jackson Wijaya, (b) family members of Jackson Wijaya, (c) trusts, partnerships or limited
liability companies for the benefit of any of the individuals identified in the foregoing clause (a) or (b), and (d) heirs, executors,
estates, successors and legal representatives of the individuals identified in the foregoing clause (a) or (b).
“Joint Venture” means any joint venture or similar arrangement (in each case, regardless of legal formation), including
but not limited to collaboration arrangements, profit sharing arrangements or other contractual arrangements.
“Joint Venture Investments” means Investments in any Joint Venture or Unrestricted Subsidiary in an aggregate amount
not to exceed the greater of (a) 10.0% of Closing Date EBITDA and (b) 10.0% of TTM Consolidated Adjusted EBITDA as of the
applicable date of determination.
“Junior Lien Indebtedness” means any Indebtedness that is intended by the Issuer to be secured by a Lien on all or any
portion of the Collateral that has a priority that is contractually (or otherwise) junior in priority to the Lien on such Collateral that
secures the Obligations under the notes (other than the ABL Obligations and Indebtedness secured on a pari passu basis with the
ABL Credit Facility on the Current Asset Collateral).
“Junior Lien Intercreditor Agreement” means a junior lien intercreditor agreement substantially in the form attached
hereto as Exhibit D or any other junior lien intercreditor agreement substantially similar thereto and reasonably satisfactory to the
Term Loan Collateral Agent).
“Laws” means, collectively, all international, foreign, federal, state, provincial, territorial, municipal and local statutes,
treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities and executive
orders, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement,
interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations
and permits of, and agreements with, any Governmental Authority.
“Lien” means any mortgage, pledge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or
other), charge, or preference, priority or other security interest or preferential arrangement of any kind or nature whatsoever
(including any conditional sale or other title retention agreement, any easement, right of way or other encumbrance on title to real
property, and any Capitalized Lease having substantially the same economic effect as any of the foregoing); provided that in no
event shall an operating lease under GAAP in and of itself be deemed a Lien.
“Limited Condition Transaction” means (x) any Restricted Payment, Asset Sale, acquisition or other Investment by the
Issuer or one or more of its Restricted Subsidiaries whose
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consummation is not conditioned on the availability of, or on obtaining, third party financing and (y) any repayment, repurchase
or refinancing of Indebtedness, Disqualified Stock or Preferred Stock with respect to which a notice of repayment (or similar
notice) has been issued.
“Long Derivative Instrument” means a Derivative Instrument (i) the value of which generally increases, and/ or the
payment or delivery obligations under which generally decrease, with positive changes to the Performance References and/or (ii)
the value of which generally decreases, and/or the payment or delivery obligations under which generally increase, with negative
changes to the Performance References.
“Management Stockholders” means (a) any Company Person who is an investor in the Issuer, Holdings or any other
Parent Entity, (b) family members of any of the individuals identified in the foregoing clause (a), (c) trusts, partnerships or
limited liability companies for the benefit of any of the individuals identified in the foregoing clause (a) or (b), and (d) heirs,
executors, estates, successors and legal representatives of the individuals identified in the foregoing clause (a) or (b).
“Market Capitalization” means an amount equal to (i) the total number of issued and outstanding shares of Equity
Interests of the Issuer (or any successor of the Issuer) or any Parent Entity on the date of the declaration or making of the relevant
Restricted Payment multiplied by (ii) the arithmetic mean of the closing prices per share of such Capital Stock for the 30
consecutive trading days immediately preceding the date of declaration or making of such Restricted Payment.
“Material Subsidiary” means, as of the Merger Date and thereafter at any date of determination, each of the Issuer’s
Domestic Subsidiaries that are Restricted Subsidiaries (a) whose total assets (other than intercompany investments) at the last day
of the most recent Test Period (when taken together with the total assets (other than intercompany investments) of the Restricted
Subsidiaries of such Domestic Subsidiary at the last day of the most recent Test Period) were equal to or greater than 5.0% of the
consolidated total assets of the Issuer and the Restricted Subsidiaries as of the last day of such Test Period, in each case
determined in accordance with GAAP or (b) whose revenues for such Test Period (when taken together with the revenues of the
Restricted Subsidiaries of such Domestic Subsidiary for such Test Period) were equal to or greater than 5.0% of the consolidated
revenues of the Issuer and the Restricted Subsidiaries for such Test Period, in each case determined in accordance with GAAP;
provided that if, at any time and from time to time after the date which is 30 days after the Merger Date (or such longer period as
the administrative agent under the Term Loan Credit Agreement, if in effect, may agree in its sole discretion), Domestic
Subsidiaries that are not Subsidiary Guarantors solely because they do not meet the thresholds set forth in clause (a) or
(b) comprise in the aggregate more than (when taken together with the total assets (other than intercompany investments) of the
Restricted Subsidiaries of such Domestic Subsidiaries at the last day of the most recent Test Period) 10.0% of the total
consolidated assets (other than intercompany investments) of the Issuer and the Restricted Subsidiaries that are Domestic
Subsidiaries as of the end of the most recently ended Test Period or more than (when taken together with the revenues of the
Restricted Subsidiaries of such Domestic Subsidiaries for such Test Period) 10.0% of the consolidated revenues of the Issuer and
the Restricted Subsidiaries that are Domestic Subsidiaries for such Test Period (or, in each case, on any date when re-designated
as an Excluded Subsidiary pursuant to the definition of “Excluded Subsidiary”), then the Issuer shall, not later than 60 days after
the date by which financial statements for such Test Period were required to be delivered pursuant to this Indenture or the date
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of such redesignation, as applicable (or such longer period as the administrative agent under the Term Loan Credit Agreement, if
in effect, may agree in its sole discretion), (i) designate in writing to the Trustee one or more of such Subsidiaries as “Material
Subsidiaries” to the extent required such that the foregoing condition ceases to be true and (ii) comply with the provisions of
Section 4.11 herein with respect to any such Subsidiaries.
“Merger” means the merger of the Escrow Issuer with and into the Company (with the Company surviving as the Issuer
of the Notes) pursuant to the Merger Agreement.
“Merger Agreement” means the Agreement and Plan of Merger dated as of May 10, 2021, among the Company, Karta
Halten B.V., a private limited company organized under the laws of the Netherlands, the Escrow Issuer, Paper Excellence B.V., a
private limited company organized under the laws of the Netherlands, and Hervey Investments B.V., a private limited company
organized under the laws of the Netherlands, as amended, restated, modified or supplemented from time to time.
“Merger Date” means the date on which the Merger is consummated.
“Minority Investment” means any Person other than a Subsidiary in which the Issuer or any Restricted Subsidiary owns
any Equity Interests.
“Model” means the financial model used in connection with the syndication of the New Senior Secured Credit
Facilities (as defined in the Offering Memorandum).
“Moody’s” means Moody’s Investors Service, Inc. and any successor thereto.
“Net Income” means, with respect to any Person, the net (loss) income of such Person, determined in accordance with
GAAP (determined, for the avoidance of doubt, on an unconsolidated basis) and before any reduction in respect of Preferred
Stock dividends.
“Net Proceeds” means the aggregate cash proceeds received by the Issuer or any Restricted Subsidiary in respect of any
Asset Sale (including, without limitation, any cash received in respect of or upon the sale or other disposition of any Designated
Non-Cash Consideration received in any Asset Sale and any cash payments received by way of deferred payment of principal
pursuant to a note or installment receivable or otherwise, but only as and when received, but excluding the assumption by the
acquiring person of Indebtedness relating to the disposed assets or other consideration received in any other non-cash form), net
of the direct costs relating to such Asset Sale and the sale or disposition of such Designated Non-Cash Consideration (including,
without limitation, legal, accounting and investment banking fees, payments made in order to obtain a necessary consent or
required by applicable law, and brokerage and sales commissions), and any relocation expenses Incurred as a result thereof, taxes
paid or payable as a result thereof (including tax distributions and after taking into account any available tax credits or deductions
and any tax sharing arrangements related solely to such disposition), amounts required to be applied to the repayment of
principal, premium (if any) and interest on Indebtedness required (other than pursuant to Section 4.06(B) herein) to be paid as a
result of such transaction, and any deduction of appropriate amounts to be provided by the Issuer as a reserve in accordance with
GAAP against any liabilities associated with the asset disposed of in such transaction and retained by the Issuer after such sale or
other disposition thereof, including, without limitation, pension and other post-
34
employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations
associated with such transaction and payments made to holders of non-controlling interests in non-Wholly Owned Subsidiaries as
a result of such Asset Sale.
Notwithstanding the foregoing or anything to the contrary in Section 4.06 herein, to the extent that the Issuer has
determined in good faith that repatriation (i) of any or all of the Net Proceeds of any Asset Sales by a Foreign Subsidiary is
prohibited, restricted or delayed by applicable local law or (ii) of any or all of the Net Proceeds of any Assets Sales by a Foreign
Subsidiary could result in an adverse tax consequence, the portion of such Net Proceeds so affected will not constitute Net
Proceeds or be required to be applied in compliance with Section 4.06 herein.
“Net Short” means, with respect to a holder or beneficial owner, as of a date of determination, either (i) the value of its
Short Derivative Instruments exceeds the sum of (x) the value of its notes plus (y) the value of its Long Derivative Instruments as
of such date of determination or (ii) it is reasonably expected that such would have been the case were a Failure to Pay or
Bankruptcy Credit Event (each as defined in the 2014 International Swaps and Derivatives Association, Inc. Credit Derivatives
Definitions) to have occurred with respect to the Issuer or any Guarantor immediately prior to such date of determination.
“New Parent” has the meaning assigned to such term in the definition of “Change of Control”.
“Not Otherwise Applied” means, with reference to the amount of any capital contributions or the sale of any Equity
Interests that is proposed to be applied to a particular use or transaction, that such amount was not previously applied in
determining the permissibility of a transaction under this Indenture (including, for the avoidance of doubt, any use of such
amount to increase the Cumulative Credit) where such permissibility was (or may have been) contingent on the receipt or
availability of such amount.
“Notes Obligations” means Obligations in respect of the Notes, this Indenture and the Guarantees.
“Obligations” means any principal, interest, penalties, fees, indemnifications, reimbursements (including, without
limitation, reimbursement obligations with respect to letters of credit and bankers’ acceptances), damages and other liabilities
payable under the documentation governing any Indebtedness (including interest, fees, expenses, indemnity claims and other
monetary obligations accrued subsequent to the commencement and during the pendency of an insolvency proceeding, whether
or not constituting an allowed claim in such proceeding); provided that Obligations with respect to the Notes shall not include
fees or indemnifications in favor of third parties other than the Trustee and the Collateral Agent.
“Offering Memorandum” means the final offering memorandum, dated October 1, 2021, relating to the issuance of the
Initial Notes.
“Officer” means the chief executive officer, president, senior vice president, senior vice president (finance), vice
president, chief financial officer, treasurer, manager of treasury activities or assistant treasurer or other similar officer or Person
performing similar functions of a Person,
35
any secretary or assistant secretary of a Person and any director of a Person or any person serving the equivalent function of any
of the foregoing or any individual designated as an “Officer” for purposes of this Indenture by the Board of Directors of such
Person.
“Officer’s Certificate” means a certificate signed on behalf of the Issuer by an Officer of the Issuer, which meets the
requirements set forth in this Indenture.
“Opinion of Counsel” means a written opinion from legal counsel who is acceptable to the Trustee. The counsel may be
an employee of or counsel to the Issuer.
“Organization Documents” means,
(1)
with respect to any corporation, the certificate and/or articles of incorporation and the bylaws (or equivalent
or comparable constitutive documents with respect to any non-U.S. jurisdiction);
(2)
with respect to any limited liability company, the certificate or articles of formation or organization and
operating agreement; and
(3)
with respect to any partnership, Joint Venture, trust or other form of business entity, the partnership, Joint
Venture or other applicable agreement of formation or organization and any agreement, instrument, filing or notice with respect
thereto filed in connection with its formation or organization with the applicable Governmental Authority in the jurisdiction of its
formation or organization and, if applicable, any certificate or articles of formation or organization of such entity.
“Outside Date” means May 18, 2022.
“Paper Excellence” means Paper Excellence B.V. and its Affiliates.
“Parent Entity” means any direct or indirect parent of the Issuer.
“Pari Passu Indebtedness” means: (a) with respect to the Issuer, the Notes and any Indebtedness which ranks pari passu
in right of payment to the Notes; and (b) with respect to any Guarantor, its Guarantee and any Indebtedness which ranks pari
passu in right of payment to such Guarantor’s Guarantee.
“Pari Passu Intercreditor Agreement” means that certain intercreditor agreement, to be entered into on or around the
Merger Date, by and among the Collateral Agent, the Term Loan Collateral Agent and each additional agent from time to time
party thereto, and acknowledged by the grantors party thereto, as amended, restated, amended and restated, extended,
supplemented or otherwise modified from time to time in accordance with its terms and this Indenture.
“Parity Lien” means a Lien granted to the Collateral Agent or other Parity Lien Representative under any Parity Lien
Indebtedness for the benefit of the holders thereof, at any time, upon the Collateral to secure Parity Lien Obligations.
36
“Parity Lien Documents” means, collectively, this Indenture, the Notes, the Security Documents, the Intercreditor
Agreements, the Term Loan Credit Agreement and the indenture, credit agreement or other agreement governing other Parity
Lien Indebtedness and the security documents related to the foregoing.
“Parity Lien Indebtedness” means:
(1)
Indebtedness represented by the Notes initially issued by the Issuer under this Indenture on the Issue Date;
(2)
Indebtedness Incurred by the Issuer or any of the Guarantors under the Term Loan Credit Agreement and/or
other obligations secured ratably thereunder that is intended by the Issuer to be secured equally and ratably with the Parity Lien
Obligations by a Parity Lien that is permitted to be Incurred and/or secured by a Parity Lien under this Indenture;
(3)
any other Indebtedness of the Issuer or any Guarantor (including Additional Notes but, for the avoidance of
doubt, excluding Priority Lien Indebtedness) that is intended by the Issuer to be secured equally and ratably with the Parity Lien
Obligations by a Parity Lien that is permitted to be Incurred and secured by a Parity Lien under this Indenture; provided that in
the case of any Indebtedness referred to in this clause (3):
(a)
on or before the date on which such Indebtedness is Incurred by the Issuer or such Guarantor, such
Indebtedness is designated by the Issuer, in accordance with the terms and conditions of the Pari Passu Intercreditor
Agreement, as “Additional Pari Passu Lien Obligations” for the purposes of the Pari Passu Intercreditor Agreement;
provided that no Series of debt may be designated as both Parity Lien Indebtedness and Priority Lien Indebtedness; and
(b)
the Parity Lien Representative of such Indebtedness becomes a party to the Intercreditor
Agreements in accordance with the terms thereof; and
(4)
guarantees by any Guarantor in respect of any of the Obligations described in the foregoing clauses
(1) through (3).
“Parity Lien Obligations” means Parity Lien Indebtedness and all other Obligations in respect thereof.
“Parity Lien Representative” means (1) the Collateral Agent, in the case of the Notes, (2) the Term Loan Collateral
Agent, in the case of the Term Loan Credit Agreement, and (3) in the case of any other Series of Parity Lien Indebtedness, the
trustee, agent or representative of the holders of such Series of Parity Lien Indebtedness who is appointed as a representative of
such Series of Parity Lien Indebtedness (for purposes related to the administration of the applicable security documents related
thereto) pursuant to the indenture, credit agreement or other agreement governing such Series of Parity Lien Indebtedness.
“Permitted Holders” means, at any time, each of (i) Jackson Wijaya and its Affiliates (but excluding any portfolio
companies of any of the foregoing), (ii) the Management Stockholders, (iii) the Co-Investors, (iv) any Person that has no material
assets other than the Capital Stock of
37
the Issuer, any Parent Entity and other Permitted Holders and, directly or indirectly, holds or acquires 100% of the total voting
power of the Voting Stock of the Issuer, and of which no other Person or group (within the meaning of Section 13(d)(3) or
Section 14(d)(2) of the Exchange Act, or any successor provision), other than any of the other Permitted Holders, holds more
than 50% of the total voting power of the Voting Stock thereof, and any New Parent and its subsidiaries, (v) any Person who is
acting solely as an underwriter in connection with a public or private offering of Equity Interests of the Issuer or any Parent
Entity, acting in such capacity, and (vi) any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange
Act, or any successor provision) the members of which include any of the Permitted Holders specified in clauses (i), (ii), (iii), (iv)
and (v) above and that, directly or indirectly, hold or acquire beneficial ownership of the Voting Stock of the Issuer (a “Permitted
Holder Group”), so long as without giving effect to the existence of such group or any other group, no Person or other “group”
(other than Permitted Holders specified in clauses (i), (ii), (iii), (iv) and (v) above) beneficially owns more than 50% on a fully
diluted basis of the Voting Stock held by the Permitted Holder Group. Any Person or group whose acquisition of beneficial
ownership constitutes a Change of Control in respect of which a Change of Control Offer or Alternate Offer is made in
accordance with the requirements of this Indenture, will thereafter, together with its Affiliates, constitute an additional Permitted
Holder.
“Permitted Investments” means:
(a)
Investments held by the Issuer or any of the Restricted Subsidiaries in assets that are Cash Equivalents or
were Cash Equivalents when made or in Investment Grade Securities;
(b)
loans or advances to any Company Person;
(i)
for reasonable and customary business-related travel, entertainment, relocation and analogous
ordinary business purposes;
(ii)
in connection with such Person’s purchase of Equity Interests of the Issuer (or any Parent Entity);
provided that, to the extent such loans or advances are made in cash, the amount of such loans and advances used to
acquire such Equity Interests shall be contributed to the Issuer in cash; and
(iii)
for any other purpose; provided that either (A) no cash or Cash Equivalents are advanced in
connection with such Investment or (B) the aggregate principal amount outstanding under this clause (b)(iii) shall not
exceed the greater of (1) 10.0% of Closing Date EBITDA and (2) 10.0% of TTM Consolidated Adjusted EBITDA as of
the applicable date of determination;
(c)
Investments,
(i)
by the Issuer or any Restricted Subsidiary in the Issuer or any Restricted Subsidiary; and
(ii)
by the Issuer or any Restricted Subsidiary in a Person, if as a result of such Investment (A) such
Person becomes a Restricted Subsidiary or (B) such Person is merged, consolidated or amalgamated with or into, or
transfers or conveys substantially all of its assets to, or is liquidated into, the Issuer or a Restricted Subsidiary; provided
that the
38
aggregate amount of Investments pursuant to this clause (c) in one or more Restricted Subsidiaries that are not
Subsidiary Guarantors shall not exceed, when taken together with the aggregate amount of Investments in one or more
Restricted Subsidiaries that are not Subsidiary Guarantors pursuant to clause (i) below, the greater of (1) 50.0% of
Closing Date EBITDA and (2) 50.0% of TTM Consolidated Adjusted EBITDA as of the applicable date of
determination;
(d)
Investments consisting of extensions of credit in the nature of accounts receivable or notes receivable arising
from the grant of trade credit in the ordinary course of business or consistent with past practice or industry norm, and Investments
received in satisfaction or partial satisfaction thereof from financially troubled account debtors and other credits to suppliers in
the ordinary course of business;
(e)
Investments consisting of Liens permitted under Section 4.12, Indebtedness (including guarantees) permitted
under Section 4.03, fundamental changes permitted under Section 5.01, Asset Sales permitted under Section 4.06 (other than by
reason of having been excluded from the definition of “Asset Sale” in reliance on clause (2)(e) thereof) and Restricted Payments
permitted under Section 4.04 herein (other than pursuant to clauses (d) and (g)(iv) of Section 4.04(2));
(f)
Investments existing on the Merger Date or made pursuant to legally binding written contracts in existence on
the Merger Date or in satisfaction of obligations under Joint Venture agreements existing on the Merger Date, and any
modification, replacement, renewal, reinvestment or extension of any of the foregoing; provided that the amount of any
Investment permitted pursuant to this clause (f) is not increased from the amount of such Investment on the Merger Date except
pursuant to the terms of such Investment as of the Merger Date or as otherwise permitted by this Indenture;
(g)
(h)
Sales;
Investments in Hedge Agreements;
promissory notes and other non-cash consideration that is permitted to be received in connection with Asset
(i)
the purchase or other acquisition by the Issuer or a Restricted Subsidiary of the Issuer (in one transaction or a
series of transactions, including by merger or otherwise) of property and assets or businesses of any Person or of assets
constituting a business unit, line of business or division of any Person or Equity Interests in a Person that, upon the
consummation thereof, will be a Restricted Subsidiary of the Issuer (including as a result of a merger, amalgamation or
consolidation) or, in the case of a purchase or acquisition of assets (other than Equity Interests), will be owned by the Issuer or a
Subsidiary of the Issuer; provided that the aggregate amount of Investments pursuant to this clause (i) in one or more Restricted
Subsidiaries that are not Subsidiary Guarantors shall not exceed, when taken together with the aggregate amount of Investments
in one or more Restricted Subsidiaries that are not Subsidiary Guarantors pursuant to clause (c) above, the greater of (1) 50.0% of
Closing Date EBITDA and (2) 50.0% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination;
(j)
Investments made to effect, or in connection with, the Transactions;
39
(k)
Investments in the ordinary course of business or consistent with past practice or industry norm consisting of
Uniform Commercial Code Article 3 endorsements for collection or deposit and Article 4 customary trade arrangements with
customers, vendors, suppliers, licensors and licensees;
(l)
Investments (including debt obligations and Equity Interests) (i) received in connection with the bankruptcy,
workout, recapitalization or reorganization of, or in settlement of delinquent obligations of, or other disputes with, any other
Person who is not an Affiliate of the Issuer, (ii) arising in the ordinary course of business or upon the foreclosure with respect to
any secured Investment or other transfer of title with respect to any secured Investment in default, (iii) in satisfaction or partial
satisfaction of judgments against other Persons who are not an Affiliate of the Issuer, (iv) as a result of the settlement,
compromise or resolutions of litigation, arbitration or other disputes with Persons who are not an Affiliate of the Issuer and (v)
received in satisfaction or partial satisfaction of trade credit and other credit extended in the ordinary course of business,
including to vendors and suppliers;
(m)
loans and advances to Holdings (or any other Parent Entity) in lieu of, and not in excess of the amount of
(after giving effect to any other loans, advances or Restricted Payments in respect thereof) Restricted Payments to the extent
permitted to be made to Holdings (or such other Parent Entity) under this Indenture;
(n)
Investments that do not exceed in the aggregate at any time outstanding the sum of (i) the greater of (A)
30.0% of Closing Date EBITDA and (B) 30.0% of TTM Consolidated Adjusted EBITDA as of the applicable date of
determination and (ii) an amount equal to any returns (including dividends, interest, distributions, returns of principal, profits on
sale, repayments, income and similar amounts) actually received in respect of any such Investment made pursuant to this clause
(n); provided that, if any Investment pursuant to this clause (n) is made in any Person that is not the Issuer or a Restricted
Subsidiary on the date of such Investment (prior to giving effect thereto) and such Person subsequently becomes the Issuer or a
Restricted Subsidiary, the Investment initially made in such Person pursuant to this clause (n) shall thereupon be deemed to have
been made pursuant to clause (c)(i) hereof and to not have been made pursuant to this clause (n) for so long as such Person
continues to be the Issuer or a Restricted Subsidiary;
(o)
advances of payroll or other payments to any Company Person;
(p)
Investments to the extent that payment for such Investments is made solely with Qualified Equity Interests of
the Issuer or any Parent Entity or the proceeds from the issuance thereof to the extent Not Otherwise Applied and without
duplication of Investments made in reliance on the Cumulative Credit;
(q)
Investments (i) held by any Person at the time such Person becomes a Restricted Subsidiary or is merged
with or into a Restricted Subsidiary to the extent that such Investments were not made in contemplation thereof or in connection
with such acquisition, merger or consolidation and were in existence on the date of such acquisition, merger or consolidation and
(ii) by Unrestricted Subsidiaries entered into (or committed to be made) prior to the date such Unrestricted Subsidiary is
designated as a Restricted Subsidiary in accordance with this Indenture to the extent that such Investments were not made (or
committed to be made) in contemplation of,
40
or in connection with, such designation and were in existence (or committed to be made) on the date of such designation;
(r)
guarantees of leases (other than Capitalized Leases) or of other obligations that do not constitute
Indebtedness;
(s)
(i) Investments in a Securitization Subsidiary or any Investment by a Securitization Subsidiary in any other
Person in connection with a Qualified Securitization Financing; provided, that any such Investment in a Securitization Subsidiary
is of Securitization Assets or equity and (ii) distributions or payments of Securitization Fees and purchases of Securitization
Assets pursuant to a Securitization Repurchase Obligation in connection with a Qualified Securitization Financing;
(t)
Investments made pursuant to the Merger Agreement in connection with the Transactions;
(u)
(i) Investments consisting of or to finance purchases and acquisitions of inventory, supplies, material,
services or equipment or the licensing or contribution of intellectual property and (ii) Investments consisting of minority interests
in customers received as part of fee arrangements or other commercial arrangements;
(v)
Investments made in connection with obtaining, maintaining or renewing client contracts and loans or
advances made to distributors, vendors, suppliers, licensors and licensees;
(w)
[reserved];
(x)
Joint Venture Investments plus an amount equal to any returns (including dividends, interest, distributions,
returns of principal, profits on sale, repayments, income and similar amounts) actually received in respect of any such Investment
made pursuant to this clause (x);
(y)
Investments in Similar Businesses that do not exceed in the aggregate at any time outstanding the greater of
(i) 25.0% of Closing Date EBITDA and (ii) 25.0% of TTM Consolidated Adjusted EBITDA as of the applicable date of
determination; provided that if any Investment pursuant to this clause (y) is made in any Person that is not the Issuer or a
Restricted Subsidiary on the date of such Investment (prior to giving effect thereto) and such Person subsequently becomes the
Issuer or a Restricted Subsidiary, the Investment initially made in such Person pursuant to this clause (y) shall thereupon be
deemed to have been made pursuant to clause (c)(i) hereof and to not have been made pursuant to this clause (y) for so long as
such Person continues to be the Issuer or a Restricted Subsidiary;
(z)
any Investment in securities or other assets not constituting Cash Equivalents and received in connection
with an Asset Sale made pursuant to the provisions of Section 4.06 herein or any other disposition of assets not constituting an
Asset Sale;
(aa)
any transaction to the extent it constitutes an Investment that is permitted by and made in accordance with
the provisions of Section 4.07(B) herein (except transactions described in clauses (10), (12), (16), (19) and (20) thereof);
41
(bb)
advances in the form of a prepayment of expenses, so long as such expenses are being paid in accordance
with customary trade terms of the Issuer or the Restricted Subsidiaries;
(cc)
any Investment in connection with intercompany cash management arrangements, treasury arrangements or
related activities;
(dd)
guarantees of Indebtedness under customer financing lines of credit in the ordinary course of business or
consistent with past practice or industry norm;
(ee)
[reserved];
(ff)
guarantees issued in accordance with Section 4.03 and Section 4.11 herein, including, without limitation, any
guarantee or other obligation issued or Incurred under any Bank Indebtedness in connection with any letter of credit issued for
the account of the Issuer or any of its Subsidiaries (including with respect to the issuance of, or payments in respect of drawings
under, such letters of credit), performance guarantees and contingent obligations Incurred in the ordinary course of business;
(gg)
contemplated thereby;
Investments in connection with any Permitted Reorganization and the transactions relating thereto or
(hh)
Investments in connection with any deferred compensation plan or arrangement or other compensation plan
or arrangement, including to a “rabbi” trust or to any grantor trust claims of creditors;
(ii)
in the event that the Issuer or any Restricted Subsidiary makes any Investment after the Issue Date in any
Person that is not a Restricted Subsidiary and such Person subsequently becomes a Restricted Subsidiary, additional Investments
in an amount equal to the Fair Market Value of such Investment as of the date on which such Person becomes a Restricted
Subsidiary;
(jj)
unfunded pension fund and other employee benefit plan obligations and liabilities to the extent that such
obligations and/or liabilities, as applicable, are permitted to remain unfunded under applicable law; and
(kk)
the conversion to Qualified Equity Interests of any Indebtedness owed by the Issuer or any Restricted
Subsidiary.
The amount of any non-cash Investments will be the Fair Market Value thereof at the time made or the applicable date
of determination without adjustment for subsequent changes in the value of such Investment at the Issuer’s option, net of any
return, whether a return of capital, interest, dividend or otherwise, with respect to such Investment. To the extent any Investment
in any Person is made in compliance with this definition of “Permitted Investments” or Section 4.04 herein in reliance on a
category above that is subject to a U.S. dollar-denominated restriction on the making of Investments and, subsequently, such
Person returns to the Issuer, any other Guarantor or, to the extent applicable, any Restricted Subsidiary all or any portion of such
Investment (in the form of a dividend, distribution, liquidation or otherwise but excluding intercompany Indebtedness), such
return shall be deemed to be credited to the U.S. dollar-denominated category against which the Investment is then charged. To
the extent the category
42
subject to a U.S. dollar-denominated restriction is also subject to a percentage of TTM Consolidated Adjusted EBITDA
restriction which, at the date of determination, produces a numerical restriction that is greater than such U.S. dollar-denominated
restriction (or restriction based on a percentage of TTM Consolidated Adjusted EBITDA, if greater), then such U.S. dollar
equivalent amount shall be deemed to be substituted in lieu of the corresponding U.S. dollar amount in the foregoing sentence for
purposes of determining such credit.
For purposes of determining compliance with any U.S. dollar-denominated restriction (or restriction based on a
percentage of TTM Consolidated Adjusted EBITDA, if greater) on the making of Investments, the U.S. dollar equivalent amount
of the Investment denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on
the date such Investment was measured.
“Permitted Liens” means, with respect to any Person:
(a)
Liens securing obligations in respect of Indebtedness under the Term Loan Credit Agreement, and in each
case, any documents related thereto, and obligations secured ratably thereunder and other Indebtedness Incurred pursuant to
Section 4.03(2)(a);
(b)
Liens securing obligations in respect of Indebtedness under the ABL Credit Agreement, and in each case,
any documents related thereto, and obligations secured ratably thereunder and other Indebtedness Incurred pursuant to Section
4.03(2)(b);
(c)
(i) Liens existing on the Issue Date (other than Liens Incurred pursuant to Section 4.03(2)(a) or (b) and
(ii) Liens securing obligations in respect of Indebtedness Incurred pursuant to Section 4.03(2)(c);
(d)
Liens granted by the Issuer or a Subsidiary Guarantor in favor of the Issuer or another Guarantor;
(e)
Liens securing obligations in respect of Indebtedness (including Capitalized Leases) permitted pursuant to
Section 4.03(2)(e); provided that such Liens attach concurrently with, or within 270 days after, the applicable acquisition,
construction, repair, replacement or improvement, and such Liens do not at any time encumber any property other than the
property financed by such Indebtedness and any replacements of such property, except for additions and accessions to such
property and the proceeds, income, profits and the products thereof, and any lease of such property (including accessions thereto)
and the proceeds, income, profits and products thereof; provided, further, that financings provided by one Person and its
Affiliates may be cross collateralized to other financings provided by such Person and its Affiliates in respect of other
Indebtedness Incurred pursuant to Section 4.03(2)(e);
(f)
(g)
[reserved];
Liens securing obligations in respect of (i) Indebtedness Incurred pursuant to the Fixed Incremental Amount
and (ii) other Indebtedness Incurred pursuant to Section 4.03(2)(g);
(h)
Liens securing obligations in respect of Notes issued on the Issue Date and the Guarantees thereof;
43
(i)
Liens securing obligations in respect of (i) Ratio Incremental Debt and (ii) other Indebtedness Incurred
pursuant to Section 4.03(2)(i), in each case, with the priority permitted under, and subject to the other terms set forth in, the
definitions of “Ratio Incremental Debt” and “Permitted Refinancing”, and other than to the extent such Indebtedness is permitted
by such defined term to be Incurred only as unsecured Indebtedness;
(j)
(k)
Liens on assets of Excluded Subsidiaries and Liens on Excluded Assets;
Liens securing obligations in respect of any Hedge Agreements;
(l)
(i) Liens existing on property at the time of its acquisition by the Issuer or a Restricted Subsidiary or existing
on property of any Person or on Equity Interests of any Person at the time such Person becomes a Restricted Subsidiary or is
merged with or into a Restricted Subsidiary; provided that (A) such Lien was not created in contemplation thereof and (B) such
Lien does not extend to or cover any other assets or property (other than (1) the proceeds or products of such assets or property,
(2) after-acquired property subject to a Lien securing Indebtedness and other obligations Incurred prior to such acquisition that
require or include, pursuant to their terms at the time of such acquisition, a pledge of after acquired property and (3) property that
is affixed or incorporated in the property covered by such Lien) and (ii) Liens securing other Indebtedness Incurred pursuant to
Section 4.03(2)(l)(iv) or Section 4.03(2)(l)(v), in each case, with the priority permitted thereunder;
(m)
Liens (i) on cash advances, earnest money deposits or escrow deposits in favor of the seller of any property
to be applied against the purchase price, in connection with any escrow arrangements or as otherwise required by any applicable
letter of intent or governing agreement, with respect to any permitted Investment or permitted Asset Sale (including any letter of
intent or purchase agreement with respect to such Investment or Asset Sale) or (B) consisting of an agreement to dispose of any
property in a permitted Asset Sale, in each case, solely to the extent such permitted Investment or Asset Sale, as the case may be,
would have been permitted on the date of the creation of such Lien;
(n)
(i) Liens securing obligations in respect of the financing of insurance premiums and (ii) Liens on cash
securing obligations to insurance companies with respect to insurable liabilities Incurred in each case in the ordinary course of
business;
(o)
Liens securing obligations in respect of Indebtedness (including arising out of any Sale/Leaseback
Transaction) Incurred pursuant to Section 4.03(2)(o);
(p)
(q)
similar instruments;
(r)
(s)
Liens on the Securitization Assets arising in connection with a Qualified Securitization Financing;
Liens in respect of the cash collateralization of letters of credit, bank guarantees, warehouse receipts or
Liens securing cash management services not prohibited by Section 4.03 herein;
Liens (i) of a collection bank arising under Section 4-208 or 4-210 of the Uniform Commercial Code on the
items in the course of collection, (ii) attaching to commodity trading
44
accounts or other commodities brokerage accounts Incurred in the ordinary course of business and not for speculative purposes
and (iii) in favor of a banking or other financial institution arising as a matter of law encumbering deposits or other funds
maintained with a financial institution (including the right of setoff) and that are within the general parameters customary in the
banking industry;
(t)
receipt of progress payments and advances from customers in the ordinary course of business to the extent the
same creates a Lien on the related inventory and proceeds thereof;
(u)
deposits to secure the performance of bids, trade contracts, governmental contracts and leases (other than
Indebtedness for borrowed money), statutory obligations, surety, stay, customs and appeal bonds, performance bonds and other
obligations of a like nature (including those to secure health, safety and environmental obligations) Incurred in the ordinary
course of business;
(v)
Liens that are customary contractual rights of setoff (i) relating to the establishment of depository relations
with banks or other deposit-taking financial institutions in the ordinary course and not given in connection with the issuance of
Indebtedness, (ii) relating to pooled deposit or sweep accounts of Holdings, the Issuer or any of the Restricted Subsidiaries to
permit satisfaction of overdraft or similar obligations Incurred in the ordinary course of business or (iii) relating to purchase
orders and other agreements entered into with customers of the Issuer or any of the Restricted Subsidiaries in the ordinary course
of business;
(w)
statutory or common law Liens of landlords, carriers, warehousemen, mechanics, materialmen, repairmen,
construction contractors or other like Liens, or other customary Liens (other than in respect of Indebtedness) in favor of
landlords, so long as, in each case, such Liens arise in the ordinary course of business that secure amounts not overdue for a
period of more than 60 days or, if more than 60 days overdue, are unfiled and no other action has been taken to enforce such Lien
or that are being contested in good faith and by appropriate actions, if adequate reserves with respect thereto are maintained on
the books of the applicable Person in accordance with GAAP;
(x)
any interest or title of a lessor, sublessor, licensor or sublicensor or secured by a lessor’s, sublessor’s,
licensor’s or sublicensor’s interest under leases or licenses entered into by the Issuer or any of the Restricted Subsidiaries as
lessee or licensee in the ordinary course of business;
(y)
Subsidiaries are located;
ground leases in respect of real property on which facilities owned or leased by the Issuer or any of its
(z)
any zoning or similar law or right reserved to or vested in any Governmental Authority to control or regulate
the use of any real property that does not materially interfere with the ordinary conduct of the business of the Issuer and its
Subsidiaries, taken as a whole;
(aa)
deposits of cash with the owner or lessor of premises leased and operated by the Issuer or any of its
Subsidiaries in the ordinary course of business of the Issuer and such Subsidiary to secure the performance of the Issuer’s or such
Subsidiary’s obligations under the terms of the lease for such premises;
45
(bb)
Liens (i) for taxes, assessments or governmental charges that are not overdue for a period of more than 60
days or that are being contested in good faith and by appropriate actions diligently conducted and for which appropriate reserves
have been established in accordance with GAAP or that are not expected to result in a material adverse effect (as determined by
the Issuer in good faith) and (ii) for property taxes on property the Issuer or its Subsidiaries has decided to abandon if the sole
recourse for such tax, assessment or charge is to such property;
(cc)
easements, rights-of-way, restrictions (including zoning restrictions), encroachments, protrusions and other
similar encumbrances and title defects affecting real property that, in the aggregate, do not in any case materially interfere with
the ordinary conduct of the business of the Issuer and its Subsidiaries taken as a whole, or the use of the property for its intended
purpose, and any other exceptions to title on the mortgage policies provided in accordance with any Bank Indebtedness;
(dd)
Liens arising from judgments or orders for the payment of money not constituting an Event of Default
pursuant to Section 6.01(7);
(ee)
leases, licenses, subleases or sublicenses granted to others in the ordinary course of business (or other
agreement under which the Issuer or any Restricted Subsidiary has granted rights to end users to access and use the Issuer’s or
any Restricted Subsidiary’s products, technologies, facilities or services) which do not (i) interfere in any material respect with
the business of the Issuer and its Restricted Subsidiaries, taken as a whole, or (ii) secure any Indebtedness;
(ff)
Liens (i) in favor of customs and revenue authorities arising as a matter of law to secure payment of customs
duties in connection with the importation of goods in the ordinary course of business and (ii) on specific items of inventory or
other goods and proceeds thereof of any Person securing such Person’s obligations in respect of bankers’ acceptances or
documentary letters of credit issued or created for the account of such Person to facilitate the purchase, shipment or storage of
such inventory or such other goods in the ordinary course of business;
(gg)
Liens arising out of conditional sale, title retention, consignment or similar arrangements for sale of goods
entered into by the Issuer or any of the Restricted Subsidiaries in the ordinary course of business;
(hh)
Liens imposed by Law or incurred pursuant to customary reservations or retentions of title (including
contractual Liens in favor of sellers and suppliers of goods) incurred in the ordinary course of business for sums not constituting
borrowed money that are not overdue for a period of more than 60 days or that are being contested in good faith by appropriated
proceedings and for which adequate reserves have been established in accordance with GAAP (if so required);
(ii)
Liens deemed to exist in connection with Investments in repurchase agreements permitted under this
Indenture and reasonable customary initial deposits and margin deposits and similar Liens attaching to commodity trading
accounts or other brokerage accounts maintained in the ordinary course of business and not for speculative purposes;
(jj)
Liens on cash and Cash Equivalents earmarked to be used to satisfy or discharge Indebtedness where such
satisfaction or discharge of such Indebtedness is not otherwise prohibited by this Indenture;
46
(kk)
or similar public filings;
purported Liens evidenced by the filing of precautionary Uniform Commercial Code financing statements
(ll)
Liens securing guarantees not prohibited by Section 4.03 herein (to the extent Section 4.12 herein does not
prohibit the underlying Indebtedness subject to such guarantee to be secured by a Lien);
(mm)
the modification, replacement, renewal or extension of any Lien not prohibited by Section 4.12 herein
(other than reliance on clauses (a) or (b) of this definition); provided that (i) such Lien does not extend to any additional property
other than (A) after-acquired property covered by an applicable grant clause, (B) property that is affixed or incorporated into the
property covered by such Lien or financed by Indebtedness permitted under Section 4.03(2)(e) and (C) proceeds and products
thereof and (ii) the renewal, extension or refinancing of the obligations secured or benefited by such Liens is permitted by
Section 4.03 herein;
(nn)
Liens securing Indebtedness or other obligations in an aggregate principal amount as of the date such
Indebtedness is incurred, not to exceed the greater of (i) 25.0% of Closing Date EBITDA and (ii) 25.0% of TTM Consolidated
Adjusted EBITDA as of the applicable date of determination;
(oo)
(i) Liens securing Indebtedness permitted to be Incurred pursuant to Section 4.03 herein and intended to be
secured by a Lien on the Collateral on a pari passu priority basis with the Liens on the Collateral securing the Obligations under
the Notes if, at the time of any Incurrence of such Indebtedness and after giving Pro Forma Effect thereto: the First Lien Net
Leverage Ratio for the applicable Test Period is equal to or less than the Closing Date First Lien Net Leverage Ratio less 0.50 to
1.00, and (ii) Liens securing Indebtedness permitted to be Incurred pursuant to Section 4.03 herein and intended to be secured by
a Lien on the Collateral with a priority that is contractually (or otherwise) junior in priority to the Liens on the Collateral securing
the Obligations under the Notes (other than Indebtedness incurred under the ABL Credit Agreement) if, at the time of any
Incurrence of such Indebtedness and after giving Pro Forma Effect thereto: the Secured Net Leverage Ratio for the applicable
Test Period is equal to or less than the Closing Date Secured Net Leverage Ratio less 0.25 to 1.00;
(pp)
Liens on cash proceeds of Indebtedness (and on the related escrow accounts) in connection with the
issuance of such Indebtedness into (and pending the release from) a customary escrow arrangement, to the extent (x) such
Indebtedness is Incurred in compliance with Section 4.03 herein and (y) the sole recourse of the holder of such Indebtedness is to
the cash on deposit in the escrow account subject to such arrangement;
(qq)
Liens on property or assets contributed to capital of the Issuer or a Subsidiary Guarantor or received in
exchange for Equity Interests of the Issuer or a Parent Entity made after the Issue Date solely to the extent Not Otherwise
Applied;
(rr)
Liens in respect of the cash collateralization of corporate credit card programs; provided that the aggregate
amount of such cash securing such obligations shall not exceed $15,000,000;
47
(ss)
Liens securing (i) Permitted Refinancing of Indebtedness; provided that (A) such Indebtedness was
permitted by Section 4.03 and was secured by a Permitted Lien or pursuant to Section 4.12, (B) such Permitted Refinancing is
permitted by Section 4.03 and (C) the Lien does not extend to any additional property, other than (1) after-acquired property
covered by any applicable grant clause, (2) property that is affixed or incorporated into the property covered by such Lien and (3)
proceeds and products thereof and (ii) guarantees permitted by Section 4.03 to the extent that the underlying Indebtedness subject
to such guarantee is permitted to be secured by a Lien; and
(tt)
(i) pledges or deposits in the ordinary course of business in connection with workers’ compensation, health,
disability or employee benefits, unemployment insurance and other social security laws or similar legislation or regulation or
other insurance-related obligations (including in respect of deductibles, self-insured retention amounts and premiums and
adjustments thereto) and (ii) pledges and deposits in the ordinary course of business securing liability for reimbursement 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 Holdings, the Issuer or any Restricted Subsidiaries;
provided that (i) any Lien incurred in compliance with this definition after the Merger Date that is intended to be
secured on a pari passu basis on the Collateral to the Notes and the Term Loan Credit Agreement will be subject to the Pari Passu
Intercreditor Agreement or another pari passu intercreditor arrangement substantially similar thereto and reasonably satisfactory
to the Term Loan Collateral Agent, in each case as amended, restated, amended and restated, modified or supplemented from
time to time in accordance with the terms hereof and thereof, (ii) any Lien incurred in compliance with this definition on or after
the Merger Date that is intended by the Issuer to be secured on a contractually junior basis on the Collateral to the Notes and the
Term Loan Credit Agreement will be subject to a Junior Lien Intercreditor Agreement and (iii) all such Liens, to the extent
required to be subject to the provisions of the ABL Intercreditor Agreement, will be subject to the ABL Intercreditor Agreement
or any other intercreditor agreement that may be executed from time to time substantially similar thereto and reasonably
satisfactory to the Term Loan Collateral Agent.
“Permitted Refinancing” means secured or unsecured Indebtedness, Disqualified Stock or Preferred Stock of the Issuer
or any Restricted Subsidiary; provided that such Indebtedness, Disqualified Stock or Preferred Stock
(1)
is in an original principal amount (or accreted value, if applicable) or liquidation preference not greater than
the principal amount (or accreted value, if applicable) or liquidation preference of the Indebtedness, Disqualified Stock or
Preferred Stock being exchanged, replaced or refinanced plus any Additional Refinancing Amount;
(2)
has a Weighted Average Life to Maturity at the time such Permitted Refinancing is Incurred which is not less
than the shorter of (x) the remaining Weighted Average Life to Maturity of the Indebtedness, Disqualified Stock or Preferred
Stock being replaced, refunded, refinanced or defeased and (y) the Weighted Average Life to Maturity that would result if all
payments of principal on the Indebtedness, Disqualified Stock and Preferred Stock being replaced, refunded, refinanced or
defeased that were due on or after the date that is one year following the last maturity
48
date of any Notes then outstanding were instead due on such date (provided that this subclause (2) will not apply to any
replacement, refunding, refinancing or defeasance of any Bank Indebtedness, the Notes or Secured Indebtedness);
(3)
to the extent such Permitted Refinancing refinances (a) Indebtedness subordinated in right of payment to the
Notes or a Guarantee, as applicable, such Permitted Refinancing is subordinated in right of payment to the Notes or the
Guarantee, as applicable, except to the extent a repayment of Subordinated Indebtedness in an aggregate principal amount equal
to the principal amount that is refinanced with Indebtedness that is not subordinated in right of payment to the Notes would
otherwise be permitted as a Restricted Payment under Section 4.04 herein, or (b) Disqualified Stock or Preferred Stock, such
Permitted Refinancing is Disqualified Stock or Preferred Stock;
(4)
shall not include (x) Indebtedness of a Restricted Subsidiary that is not a Subsidiary Guarantor that
refinances Indebtedness of the Issuer or a Subsidiary Guarantor, or (y) Indebtedness of the Issuer or a Restricted Subsidiary that
refinances Indebtedness of an Unrestricted Subsidiary; and
(5)
to the extent such Permitted Refinancing is Secured Indebtedness, the Liens securing such Refinancing
Indebtedness have a Lien priority equal to or junior to the Liens securing the Indebtedness being refunded, refinanced, replaced,
redeemed, repurchased or retired.
“Permitted Reorganization” means any transaction (a) undertaken to effect a corporate reorganization (or similar
transaction or event) for operational or efficiency purposes, (b) undertaken in connection with and reasonably required for
consummating a Qualifying IPO, or (c) related to tax planning or tax reorganization, in each case, as determined in good faith by
the Issuer and entered into after the Issue Date; provided that, (i) no Event of Default is continuing immediately prior to such
transaction and immediately after giving effect thereto and (ii) such transaction will not materially adversely affect the Issuer’s
ability to make anticipated principal or interest payments on the Notes as and when they become due (in each case, as determined
in good faith by the Issuer).
“Person” or “person” means any individual, corporation, partnership, limited liability company, Joint Venture,
association, company, joint-stock company, trust, unincorporated organization, government or any agency or political subdivision
thereof or any other entity.
“Preferred Stock” means any Equity Interest with preferential right of payment of dividends or upon liquidation,
dissolution, or winding up.
“Principal Property Subsidiary” means any Subsidiary that owns, operates or leases one or more Restricted Properties.
“Priority Lien Documents” means, collectively, the ABL Credit Agreement, the ABL Intercreditor Agreement and the
indenture, credit agreement or other agreement governing other Priority Lien Indebtedness and the security documents related to
the foregoing.
“Priority Lien Indebtedness” means:
49
(1)
Indebtedness (including letters of credit and reimbursement obligations with respect thereto) and other
Obligations Incurred by the Issuer or any Subsidiary under or in respect of the ABL Credit Agreement and/or secured by the
Priority Lien Security Documents;
(2)
any other Indebtedness of the Issuer or any Subsidiary that is intended by the Issuer to be secured by Liens
that are equal and ratable with the Priority Lien Indebtedness; provided that, in the case of any Indebtedness referred to in this
clause (2):
(a)
on or before the date on which such Indebtedness is Incurred by the Issuer or such Subsidiary, such
Indebtedness is designated by the Issuer, in accordance with the terms and conditions of the ABL Intercreditor
Agreement, as “Revolving Credit Obligations” for the purposes of the ABL Intercreditor Agreement; provided that no
Series of Indebtedness may be designated as both Priority Lien Indebtedness and Parity Lien Indebtedness; and
(b)
the Priority Lien Representative of such Indebtedness becomes a party to the ABL Intercreditor
Agreement in accordance with the requirements thereof; and
(3)
guarantees by the Issuer or any Subsidiary in respect of any of the Obligations described in the foregoing
clauses (1) and (2).
“Priority Lien Obligations” means Priority Lien Indebtedness and all other Obligations in respect thereof.
“Priority Lien Representative” means, (1) in the case of the ABL Credit Agreement, the ABL Collateral Agent and
(2) in the case of any other Priority Lien Indebtedness, the trustee, agent or representative of the holders of such Priority Lien
Indebtedness who is appointed as a representative of such Priority Lien Indebtedness (for purposes related to the administration
of the applicable security documents related thereto) pursuant to the indenture, credit agreement or other agreement governing
such Priority Lien Indebtedness.
“Priority Lien Security Documents” means all security agreements, pledge agreements, control agreements, collateral
assignments, security deeds, deeds to secure debt, deeds of trust, hypothecs, hypothecations, collateral agency agreements,
debentures or other instruments or other pledges, grants or transfers for security or agreements related thereto executed and
delivered by the Issuer or any Subsidiary creating or perfecting (or purporting to create or perfect) a Lien (including, without
limitation, financing statements under the Uniform Commercial Code) in favor of the ABL Collateral Agent, in each case, as
amended, modified, renewed, restated, supplemented or replaced, in whole or in part, from time to time, in accordance with its
terms and the applicable Priority Lien Documents, subject to the terms of the ABL Intercreditor Agreement, as applicable.
“Pro Forma Basis” and “Pro Forma Effect” mean, with respect to compliance with any test or covenant or calculation
under this Indenture, the determination or calculation of such test, covenant or ratio (including in connection with Specified
Transactions) in accordance with Section 1.05 herein.
“Public Company Costs” means costs relating to compliance with the Sarbanes-Oxley Act of 2002, as amended, and
other expenses arising out of or incidental to Holdings’ status (or any
50
Parent Entity’s status) as a reporting company, including costs, fees and expenses (including legal, accounting and other
professional fees) relating to compliance with provisions of the Securities Act and the Exchange Act, the rules of securities
exchange companies with listed equity securities, directors’ compensation, fees and expense reimbursement, shareholder
meetings and reports to shareholders, directors’ and officers’ insurance and other executive costs, legal and other professional
fees, and listing fees.
“Qualified Equity Interests” means any Equity Interests that are not Disqualified Stock.
“Qualified Securitization Financing” means any Securitization Financing of a Securitization Subsidiary that meets the
following conditions: (a) such Qualified Securitization Financing (including financing terms, covenants, termination events and
other provisions) is in the aggregate economically fair and reasonable to the Issuer and the Securitization Subsidiary, as
determined by the Issuer in good faith, (b) all sales, transfers and/or contributions of Securitization Assets and related assets to
the Securitization Subsidiary are made at Fair Market Value and (c) the financing terms, covenants, termination events and other
provisions thereof, including any Standard Securitization Undertakings, shall be market terms, as determined by the Issuer in
good faith.
“Qualifying IPO” means either (a) the issuance by Holdings or any Parent Entity of its common Equity Interests in a
public offering (other than a public offering pursuant to a registration statement on Form S-8 (or equivalent forms applicable for
foreign public companies or foreign private issuers) or any successor form) pursuant to an effective registration statement filed
with the SEC in accordance with the Securities Act or pursuant to a prospectus or similar documents filed with securities
regulatory authorities outside of the United States or (b) any transaction or series of transactions, including a SPAC IPO, that
results in, or following which, any common Equity Interests of the Issuer, any Parent Entity or any SPAC IPO Entity (or its
successor by merger, amalgamation or other combination) being publicly traded on any United States national securities
exchange or over-the-counter market, or any analogous exchange or market in Canada, the United Kingdom or the European
Union.
“Rating Agency” means (1) each of Moody’s, S&P and Fitch (and their respective successors and assigns) and (2) if
Moody’s, S&P or Fitch ceases to rate the Notes, a “nationally recognized statistical rating organization” within the meaning of
Rule 15cs-1(c)(2)(vi)(F) under the Exchange Act selected by the Issuer or any Parent Entity as a replacement agency for
Moody’s, S&P or Fitch, as the case may be.
“Ratio Incremental Debt” means secured or unsecured Indebtedness and Disqualified Stock of the Issuer and any
Subsidiary Guarantor and Indebtedness, Disqualified Stock and Preferred Stock of any Restricted Subsidiary; provided that
immediately after giving effect to the issuance, Incurrence, or assumption of such Indebtedness, Disqualified Stock or Preferred
Stock, on a Pro Forma Basis, either:
(1)
if such Indebtedness, Disqualified Stock, Preferred Stock is not secured by a Lien on any Collateral the Total
Net Leverage Ratio for the applicable Test Period is equal to or less than the Closing Date Total Net Leverage Ratio; or
51
(2)
if such Indebtedness, Disqualified Stock or Preferred Stock is secured by a Lien on all or any portion of the
Collateral that has a priority that is contractually (or otherwise) junior in priority to the Liens on the Collateral securing the
Obligations under the Notes (other than Indebtedness incurred under the ABL Credit Agreement or Indebtedness secured on a
pari passu basis with the ABL Credit Agreement) (or, at the Issuer’s election, such Indebtedness, Disqualified Stock or Preferred
Stock is not secured by a Lien on any Collateral or is unsecured), on a Pro Forma Basis: the Secured Net Leverage Ratio for the
applicable Test Period is equal to or less than the Closing Date Secured Net Leverage Ratio less 0.25 to 1.00 (it being understood
that any secured Indebtedness, Disqualified Stock or Preferred Stock of the Issuer or any Restricted Subsidiary being Incurred or
issued pursuant to this clause (2) shall be treated as Indebtedness that is secured by a Lien on Collateral under the definition of
“Consolidated Secured Net Debt” for the purposes of such calculation); or
(3)
if such Indebtedness, Disqualified Stock or Preferred Stock is secured by a Lien on all or any portion of the
Collateral that is pari passu in priority with the Liens on the Collateral securing the Obligations under the Notes (or, at the
Issuer’s election, such Indebtedness, Disqualified Stock or Preferred Stock is secured by a Lien on all or any portion of the
Collateral that has a priority that is contractually (or otherwise) junior in priority to the Liens on the Collateral securing the
Obligations under the Notes (other than Indebtedness incurred under the ABL Credit Agreement), not secured by a Lien on any
Collateral or is unsecured), on a Pro Forma Basis: the First Lien Net Leverage Ratio for the applicable Test Period is equal to or
less than the Closing Date First Lien Net Leverage Ratio less 0.50 to 1.00 (it being understood that any secured Indebtedness,
Disqualified Stock or Preferred Stock of the Issuer or any Restricted Subsidiary being Incurred or issued pursuant to this clause
(3) shall be treated as Indebtedness that is secured by a Lien on Collateral with the priority set forth under clause (iv) of the
definition of “Consolidated First Lien Net Debt” for the purposes of such calculation);
in each case, after giving Pro Forma Effect to the Incurrence of such Indebtedness, Disqualified Stock and Preferred Stock and
the use of proceeds thereof and measured as of and for the applicable Test Period for which internal financial statements are
available.
“Record Date” has the meaning specified in Exhibit A hereto.
“Regulated Bank” means an Approved Commercial Bank that is (i) a U.S. depository institution the deposits of which
are insured by the Federal Deposit Insurance Corporation; (ii) a corporation organized under section 25A of the U.S. Federal
Reserve Act of 1913; (iii) a branch, agency or commercial lending company of a foreign bank operating pursuant to approval by
and under the supervision of the Board of Governors under 12 CFR part 211; (iv) a non-U.S. branch of a foreign bank managed
and controlled by a U.S. branch referred to in clause (iii); or (v) any other U.S. or non-U.S. depository institution or any branch,
agency or similar office thereof supervised by a bank regulatory authority in any jurisdiction.
“Restricted” means, when referring to cash or Cash Equivalents of the Issuer or any of the Restricted Subsidiaries, that
such cash or Cash Equivalents appear (or would be required to appear) as “restricted” on a consolidated balance sheet of the
Issuer or such Restricted Subsidiary (unless such appearance is related to a restriction in favor of an administrative agent,
collateral agent or trustee under any Bank Indebtedness or the Notes).
52
“Restricted Investment” means an Investment other than a Permitted Investment.
“Restricted Property” means (a) any manufacturing facility, or portion thereof, owned or leased by the Issuer or any of
its Subsidiaries and located within the United States, which, in the opinion of the Board of Director of the Issuer (or any Parent
Entity), is of material importance to the business of the Issuer and its Subsidiaries taken as a whole, but no such manufacturing
facility, or portion thereof, shall be deemed of material importance if its gross book value (before deducting accumulated
depreciation) is less than 5% of Total Assets, or (b) any shares of Capital Stock of any Subsidiary owning any such
manufacturing facility. As used in this definition, “manufacturing facility” means property, plant and equipment used for actual
manufacturing such as quality assurance, engineering, maintenance, staging area for work in process materials, employees’ eating
and comfort facilities and manufacturing administration, and it excludes sales offices, research facilities and facilities used only
for warehousing or general administration.
“Restricted Subsidiary” means, with respect to any Person, any Subsidiary of such Person other than an Unrestricted
Subsidiary of such Person. Unless otherwise indicated in this Indenture, all references to Restricted Subsidiaries shall mean
Restricted Subsidiaries of the Issuer.
“S&P” means Standard & Poor’s, a division of S&P Global Inc., and any successor thereto.
“Sale/Leaseback Transaction” means a sale leaseback transaction with respect to all or any portion of any real property,
equipment or capital assets owned by the Issuer or a Guarantor or other property customarily included in such transactions.
“Screened Affiliate” means any Affiliate of a holder (i) that makes investment decisions independently from such
holder and any other Affiliate of such holder that is not a Screened Affiliate, (ii) that has in place customary information screens
between it and such holder and any other Affiliate of such holder that is not a Screened Affiliate and such screens prohibit the
sharing of information with respect to the Issuer or its Subsidiaries, (iii) whose investment policies are not directed by such
holder or any other Affiliate of such holder that is acting in concert with such holder in connection with its investment in the
Notes, and (iv) whose investment decisions are not influenced by the investment decisions of such holder or any other Affiliate of
such holder that is acting in concert with such holders in connection with its investment in the Notes.
“SEC” means the Securities and Exchange Commission, or any Governmental Authority succeeding to any of its
principal functions.
“Secured Indebtedness” means Indebtedness secured by a Lien other than Indebtedness with respect to cash
management services.
“Secured Net Leverage Ratio” means, with respect to any Test Period, the ratio of (a) Consolidated Secured Net Debt
outstanding as of the last day of such Test Period to (b) Consolidated Adjusted EBITDA of the Issuer for such Test Period.
“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated
thereunder.
53
“Securitization Assets” means the accounts receivable, royalty or other revenue streams, other rights to payment
(including with respect to rights of payment pursuant to the terms of Joint Ventures) subject to a Qualified Securitization
Financing and the proceeds thereof.
“Securitization Fees” means distributions or payments made directly or by means of discounts with respect to any
participation interest issued or sold in connection with, and other fees paid to a Person that is not a Securitization Subsidiary in
connection with any Qualified Securitization Financing.
“Securitization Financing” means any transaction or series of transactions that may be entered into by the Issuer or any
of its Subsidiaries pursuant to which the Issuer or any of its Subsidiaries may sell, convey or otherwise transfer to (a) a
Securitization Subsidiary (in the case of a transfer by the Issuer or any of its Subsidiaries) or (b) any other Person (in the case of a
transfer by a Securitization Subsidiary), or may grant a security interest or Lien in, any Securitization Assets of the Issuer or any
of its Subsidiaries, and any assets related thereto, including all collateral securing such Securitization Assets, all contracts and all
guarantees or other obligations in respect of such Securitization Assets, proceeds of such Securitization Assets and other assets
that are customarily transferred or in respect of which security interests are customarily granted in connection with asset
securitization transactions involving Securitization Assets as determined by the Issuer in good faith.
“Securitization Repurchase Obligation” means any obligation of a seller or transferor of Securitization Assets in a
Qualified Securitization Financing to repurchase Securitization Assets arising as a result of a breach of a Standard Securitization
Undertaking, including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, offset or
counterclaim of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller.
“Securitization Subsidiary” means a Wholly Owned Subsidiary of the Issuer (or another Person formed for the
purposes of engaging in a Qualified Securitization Financing in which the Issuer or any Subsidiary of the Issuer makes an
Investment and to which the Issuer or any Subsidiary of the Issuer transfers Securitization Assets and related assets) that engages
in no activities other than in connection with the financing of Securitization Assets of the Issuer or its Subsidiaries, all proceeds
thereof and all rights (contingent and other), collateral and other assets relating thereto, and any business or activities incidental
or related to such business, and which is designated by the Board of Directors of the Issuer or such other Person (as provided
below) as a Securitization Subsidiary, and
(1)
no portion of the Indebtedness or any other obligation (contingent or otherwise) of which (i) is guaranteed by
the Issuer or any other Subsidiary of the Issuer, other than another Securitization Subsidiary (excluding guarantees of obligations
(other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings), (ii) is recourse to or
obligates the Issuer or any other Subsidiary of the Issuer, other than another Securitization Subsidiary, in any way other than
pursuant to Standard Securitization Undertakings or (iii) subjects any property or asset of the Issuer or any other Subsidiary of the
Issuer, other than another Securitization Subsidiary, directly or indirectly, contingently or otherwise, to the satisfaction thereof,
other than pursuant to Standard Securitization Undertakings,
54
(2)
with which none of the Issuer or any other Subsidiary of the Issuer, other than another Securitization
Subsidiary, has any material contract, agreement, arrangement or understanding other than on terms which the Issuer reasonably
believes to be no less favorable to the Issuer or such Subsidiary than those that might be obtained at the time from Persons that
are not Affiliates of the Issuer,
(3)
to which none of the Issuer or any other Subsidiary of the Issuer, other than another Securitization
Subsidiary, has any obligation to maintain or preserve such entity’s financial condition or cause such entity to achieve certain
levels of operating results, and
(4)
any such designation by the Board of Directors of the Issuer or such other Person shall, upon the Trustee’s
request, be evidenced to the Trustee by delivery to the Trustee of a certified copy of the resolution of the Board of Directors of
the Issuer or such other Person giving effect to such designation and a certificate executed by an Officer certifying that such
designation complied with the foregoing conditions;
it being agreed that a Securitization Asset consisting of an obligation of or to any Affiliate of the Issuer or a Guarantor
(other than the Issuer or a Restricted Subsidiary, unless otherwise permitted by Section 4.06 herein) shall not result non-
compliance with any of the foregoing provisions.
“Security Agreement” means that certain notes security agreement, dated as of the date of the Escrow Release, by and
among the Issuer, the Guarantors party thereto from time to time and the Collateral Agent, as amended, restated, extended,
supplemented or otherwise modified from time to time in accordance with the terms thereof and hereof.
“Security Documents” means the Security Agreement, all security agreements, pledge agreements, control agreements,
collateral assignments, security deeds, deeds to secure debt, deeds of trust, deeds of hypothec, hypothecations, collateral agency
agreements, debentures or other instruments or other pledges, grants or transfers for security or agreements related thereto
executed and delivered by the Issuer or any Guarantor creating or perfecting (or purporting to create or perfect) a Lien upon
Collateral (including, without limitation, financing statements under the Uniform Commercial Code) in favor of the Collateral
Agent on behalf of itself, the Trustee and the holders of the Notes to secure the Notes and the Guarantees, in each case, as
amended, modified, renewed, restated, supplemented or replaced, in whole or in part, from time to time, in accordance with its
terms and the provisions set forth in Article XIII.
“Series” means, (a) with respect to the holders of Parity Lien Indebtedness, each of (1) the Collateral Agent and the
holders of the Notes (in their capacities as such), in the case of the Notes, (2) the Term Loan Collateral Agent and the holders of
the Term Loan Obligations (in their capacities as such), in the case of the Term Loan Credit Agreement, and (3) the holders of
any other Series of Parity Lien Indebtedness that become party to the Pari Passu Intercreditor Agreement and the trustee, agent or
representative of the holders of such Series of Parity Lien Indebtedness who is appointed as a representative of such Series of
Parity Lien Indebtedness (for purposes related to the administration of the applicable security documents related thereto) pursuant
to the indenture, credit agreement or other agreement governing such Series of Parity Lien Indebtedness (in their capacities as
such) and (b) with respect to any Parity Lien Obligations, each of (1) the Obligations in respect of the Notes, (2) the Term Loan
Obligations and (3) the
55
Obligations in respect of other Parity Lien Indebtedness which, pursuant to a joinder agreement, are to be represented under the
Pari Passu Intercreditor Agreement by a common collateral agent (in its capacity as such for such other Parity Lien
Indebtedness).
“Short Derivative Instrument” means a Derivative Instrument (i) the value of which generally decreases, and/or the
payment or delivery obligations under which generally increase, with positive changes to the Performance References and/or (ii)
the value of which generally increases, and/or the payment or delivery obligations under which generally decrease, with negative
changes to the Performance References.
“Significant Subsidiary” means any Restricted Subsidiary that would be a “Significant Subsidiary” of the Issuer within
the meaning of Rule 1-02 under Regulation S-X promulgated by the SEC (or any successor provision).
“Similar Business” means any business, the majority of whose revenues are derived from (i) the business or activities
of the Issuer and its Subsidiaries as of the Merger Date, (ii) any business that is a natural outgrowth or a reasonable extension,
development or expansion of any such business or any business similar, reasonably related, incidental, complementary or
ancillary to any of the foregoing or (iii) any business that in the Issuer’s good faith business judgment constitutes a reasonable
diversification of business conducted by the Issuer and its Subsidiaries.
“SPAC IPO” means the acquisition, purchase, merger, amalgamation or other combination of the Issuer or any Parent
Entity by, or with, a publicly traded special purpose acquisition company or targeted acquisition company or any entity similar to
the foregoing (a “SPAC IPO Entity”) that results in, or following which, any common Equity Interests of the Issuer, any Parent
Entity, or such SPAC IPO Entity (or its successor by merger, amalgamation or other combination) being publicly traded on any
United States national securities exchange or over-the-counter market, or any analogous exchange or market in Canada, the
United Kingdom or the European Union.
“SPAC IPO Entity” has the meaning assigned to such term in the definition of “SPAC IPO.”
“Special Change of Control Mandatory Redemption Amount” means an amount equal to the lesser of (x) $250,000,000
and (y) 50.0% of the combined aggregate principal amount of each series of the Existing Notes that have not been tendered and
accepted for purchase pursuant to and in accordance with the Existing Notes Change of Control Offers prior to the expiration
thereof.
“Special Mandatory Redemption Price” means a price equal to 100.0% of the initial issue price of the Notes plus
accrued and unpaid interest (and accretion, if any) from the Issue Date, to, but not including, the Special Mandatory Redemption
Date.
“Specified Event of Default” means an Event of Default described in Section 6.01(1), 6.01(2) or 6.01(6).
“Specified Transaction” means any of the following identified by the Issuer: (a) transaction or series of related
transactions, including Investments, that results in a Person becoming a Restricted Subsidiary, (b) any designation of a Subsidiary
as a Restricted Subsidiary or an
56
Unrestricted Subsidiary, (c) any acquisition, any Asset Sale or other disposition, (d) any transaction or series of related
transactions, including dispositions, that results in a Restricted Subsidiary ceasing to be a Subsidiary of the Issuer, (e) any
acquisition or disposition of assets constituting a business unit, line of business or division of another Person or a facility, (f) any
material acquisition or disposition, (g) any restructuring of the business of the Issuer, whether by merger, consolidation,
amalgamation or otherwise, (h) any incurrence or repayment of Indebtedness, Disqualified Stock or Preferred Stock (other than
Indebtedness incurred or repaid under any revolving credit facility in the ordinary course of business for working capital
purposes), (i) any Restricted Payment or incurrence of Indebtedness or incurrence/creation of Liens that by the terms of this
Indenture requires such test to be calculated on a “Pro Forma Basis” or after giving “Pro Forma Effect” and (j) transactions of the
type given pro forma effect in the Model or any quality of earnings report prepared by a nationally recognized accounting firm in
connection with the Transactions; provided that, at the Issuer’s election, any Specified Transaction having an aggregate value of
less than $1,000,000 shall not be calculated on a Pro Forma Basis or after giving Pro Forma Effect.
“Standard Securitization Undertakings” means representations, warranties, covenants and indemnities entered into by
the Issuer or any Subsidiary of the Issuer that are customary in a Securitization Financing.
“Stated Maturity” means, with respect to any security, the date specified in such security as the fixed date on which the
final payment of principal of such security is due and payable.
“Subordinated Indebtedness” means (a) with respect to the Issuer, any Indebtedness of the Issuer which is by their
terms subordinated in right of payment to the Notes, and (b) with respect to any Guarantor, any Indebtedness of such Guarantor
which is by its terms subordinated in right of payment to its Guarantee.
“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, unlimited
liability company or other entity of which (a) the Equity Interests having ordinary voting power (other than Equity Interests
having such power only by reason of the happening of a contingency) to elect a majority of the Board of Directors of such
corporation, partnership, limited liability company or other entity are at the time owned by such Person or (b) more than 50.0% of
the Equity Interests are at the time owned by such Person. Unless otherwise indicated herein, all references to Subsidiaries will
mean Subsidiaries of the Issuer. No Person shall be considered a Subsidiary of the Issuer unless the Issuer has the ability to
Control such Subsidiary.
“Subsidiary Guarantor” means any Subsidiary that Incurs a Guarantee; provided that upon the release or discharge of
such Person from its Guarantee in accordance with this Indenture, such Subsidiary ceases to be a Subsidiary Guarantor.
“Suspension Period” means the period of time between a Covenant Suspension Event and the related Reversion Date.
“Swap Termination Value” means, in respect of any one or more Hedge Agreements, after taking into account the effect
of any legally enforceable netting agreement relating to such Hedge
57
Agreements, (a) for any date on or after the date such Hedge Agreements have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the
amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one or more mid-
market or other readily available quotations provided by any recognized dealer in such Hedge Agreements.
“Taxes” means any taxes, duties, levies, imposts, deductions, assessments, fees, withholdings or similar charges
imposed by any Governmental Authority, and all liabilities (including additions to tax, penalties and interest) with respect thereto.
“Term Loan Collateral Agent” means Barclays Bank PLC, as collateral agent under the Term Loan Credit Agreement
and its successors and permitted assigns thereunder.
“Term Loan Credit Agreement” means the term loan credit agreement to be entered into on or prior to the Merger Date
among the Issuer, Holdings, the lenders party thereto, the other parties thereto and Barclays Bank PLC, as administrative agent
and collateral agent, as amended, restated, supplemented, waived, replaced (whether or not upon termination or in effect at such
time, and whether with the original lenders or otherwise), restructured, repaid, refunded, refinanced or otherwise modified from
time to time, including any agreement or indenture extending the maturity thereof, refinancing, replacing or otherwise
restructuring all or any portion of the Indebtedness, Disqualified Stock or Preferred Stock under such agreement or agreements or
indenture or indentures or any successor or replacement agreement or agreements or indenture or indentures or increasing the
amount loaned or issued thereunder or altering the maturity thereof (except to the extent any such refinancing, replacement or
restructuring or agreement or instrument is designated by the Issuer to not be included in the definition of “Term Loan Credit
Agreement”).
“Term Loan Obligations” means the Obligations under the Term Loan Credit Agreement.
“Test Period” in effect at any time means the most recent period of four consecutive fiscal quarters of the Issuer ended
on or prior to such time (taken as one accounting period) in respect of which internal financial statements for each quarter or
fiscal year in such period are available. A Test Period may be designated by reference to the last day thereof (i.e., the “June 30,
2021 Test Period” refers to the period of four consecutive fiscal quarters of the Issuer ended on June 30, 2021), and a Test Period
shall be deemed to end on the last day thereof.
“TIA” means the Trust Indenture Act of 1939 (15 U.S.C. Sections 77aaa-77bbbb), as amended.
“Total Assets” means the total consolidated assets of the Issuer and the Restricted Subsidiaries, as shown on the most
recent balance sheet of the Issuer, without giving effect to any impairment or amortization of the amount of intangible assets
since June 30, 2021, calculated on a Pro Forma Basis after giving effect to any subsequent acquisition or disposition of a Person
or business.
“Total Net Leverage Ratio” means, with respect to any Test Period, the ratio of (a) Consolidated Net Debt as of the last
day of such Test Period to (b) Consolidated Adjusted EBITDA of the Issuer for such Test Period.
58
“Transaction Expenses” means any fees or expenses incurred or paid by the Issuer or any of its Subsidiaries in
connection with the Transactions, this Indenture, the Notes, the Credit Agreements and the transactions contemplated hereby and
thereby, including any amortization thereof in any period, including any amortization thereof in any period.
“Transactions” means the transactions described under “Summary—Recent Developments—Transactions” in the
Offering Memorandum.
“Treasury Rate” means, as of the applicable redemption date, as determined by the Issuer, the yield to maturity as of
such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent
Federal Reserve Statistical Release H.15 that has become publicly available at least two Business Days prior to such redemption
date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly
equal to the period from such redemption date to October 1, 2024; provided, however, that if the period from such redemption
date to October 1, 2024 is less than one year, the weekly average yield on actively traded United States Treasury securities
adjusted to a constant maturity of one year will be used.
“Trust Officer” means any officer:
(1)
within the corporate trust department of the Trustee, including any vice president, assistant vice president,
assistant secretary, assistant treasurer, trust officer or any other officer of the Trustee who customarily performs functions similar
to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is
referred because of such person’s knowledge of and familiarity with the particular subject, and
(2)
who shall have direct responsibility for the administration of this Indenture.
“Trustee” means the party named as such in this Indenture until a successor replaces it and, thereafter, means the
successor.
“TTM Consolidated Adjusted EBITDA” means, as of any date of determination, the Consolidated Adjusted EBITDA
of the Issuer for the four consecutive fiscal quarters most recently ended prior to such date for which internal financial statements
are available, determined on a Pro Forma Basis.
“United States” means the United States of America.
“Unrestricted Subsidiary” means:
(1)
(2)
each Securitization Subsidiary;
any Subsidiary of the Issuer that at the time of determination shall be designated an Unrestricted Subsidiary
by the Board of Directors of the Issuer in the manner provided below; and
(3)
any Subsidiary of an Unrestricted Subsidiary;
59
The Issuer may designate any Subsidiary of the Issuer (including any newly acquired or newly formed Subsidiary) to
be an Unrestricted Subsidiary unless at the time of such designation such Subsidiary or any of their Subsidiaries owns any Equity
Interests or Indebtedness of, or owns or holds any Lien on any property of, the Issuer or any other Restricted Subsidiary of the
Issuer that is not a Subsidiary of the Subsidiary to be so designated, in each case at the time of such designation; provided,
however, that (i) immediately after giving effect to such designation, no Specified Event of Default will have occurred and be
continuing as a result of such designation, (ii) the Subsidiary to be so designated and their Subsidiaries do not at the time of
designation have and do not thereafter Incur any Indebtedness pursuant to which the lender has recourse to any of the assets of
the Issuer or any of the Restricted Subsidiaries unless otherwise permitted under Section 4.04 or Section 4.03 herein and (iii) the
Issuer may not designate any Subsidiary of the Issuer to be an Unrestricted Subsidiary during any Suspension Period; provided,
further, however, that either:
(a)
(b)
the Subsidiary to be so designated has total consolidated assets of $1,000 or less; or
if such Subsidiary has consolidated assets greater than $1,000, then such designation would be permitted
under Section 4.04 herein.
The Issuer may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided, however, that
immediately after giving effect to such designation:
(x)
(1) the Issuer could Incur $1.00 of additional Indebtedness as Ratio Debt on a Pro Forma Basis taking into
account such designation (or otherwise Incur any Indebtedness at such Unrestricted Subsidiary as if it was a Restricted
Subsidiary), and
(y)
no Event of Default shall have occurred and be continuing.
Any such designation by the Issuer shall be evidenced to the Trustee by promptly filing with the Trustee a copy of the
resolution of the Board of Directors of the Issuer (or any Parent Entity) or any committee thereof of the Issuer giving effect to
such designation and an Officer’s Certificate certifying that such designation complied with the foregoing provisions.
“U.S. Government Obligations” means securities that are:
(4)
direct obligations of the United States of America for the timely payment of which its full faith and credit is
pledged, or
(5)
obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United
States of America, the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United
States of America,
which, in each case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depository receipt
issued by a bank (as defined in Section 3(a)(2) of the Securities Act) as custodian with respect to any such U.S. Government
Obligations or a specific payment of principal of or interest on any such U.S. Government Obligations held by such custodian for
the account of the holder of such depository receipt; provided that (except as required by law) such
60
custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any
amount received by the custodian in respect of the U.S. Government Obligations or the specific payment of principal of or
interest on the U.S. Government Obligations evidenced by such depository receipt.
“Voting Stock” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote
in the election of the Board of Directors of such Person.
“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years
obtained by dividing:
(1)
the sum of the products obtained by multiplying (i) the amount of each then remaining installment, sinking
fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by
(2)
the then outstanding principal amount of such Indebtedness;
provided that for purposes of determining the Weighted Average Life to Maturity of (i) any Permitted Refinancing, (ii) any
Indebtedness that is being modified, refinanced, refunded, renewed, replaced or extended, or (iii) any term loans for purposes of
Incurring any other Indebtedness (in any such case, the “Applicable Indebtedness”), the effects of any amortization payments or
other prepayments made on such Applicable Indebtedness (including the effect of any prepayment on remaining scheduled
amortization) prior to the date of the applicable modification, refinancing, refunding, renewal, replacement, extension or
Incurrence shall be disregarded.
“Wholly Owned” means, with respect to a Subsidiary of a Person, a Subsidiary of such Person all of the outstanding
Equity Interests of which (other than (a) director’s qualifying shares and (b) nominal shares issued to foreign nationals to the
extent required by applicable Law) are owned by such Person and/or by one or more wholly owned Subsidiaries of such Person.
“Wholly Owned Restricted Subsidiary” is any Wholly Owned Subsidiary that is a Restricted Subsidiary.
SECTION 1.02
Other Definitions
.
Term
$
Affiliate Transaction
Agent Members
Asset Sale Offer
Bankruptcy Law
Change of Control Offer
Clearstream
Company
covenant defeasance option
Covenant Suspension Event
Custodian
Section
1.03(13)
4.07(A)
Appendix A
4.06
6.01
4.08(2)
Appendix A
Preamble
8.01(2)
4.15
6.01
61
Term
Definitive Note
Depository
Directing Holder
Escrow Issuer
Euroclear
Escrow Agreement
Escrow Condition
Escrow Release
Escrowed Amount
Escrowed Funds
Excess Proceeds
Global Notes
Global Notes Legend
Guaranteed Obligations
IAI
Increased Amount
Indenture
Initial Notes
Issuer
legal defeasance option
Liens Covenant Election Date
Mandatory Redemption Event
Notes
Notes Custodian
Noteholder Direction
Notice of Default
Offer Period
Paying Agent
Permitted Debt
Permitted Jurisdictions
Position Representation
protected purchaser
QIB
Ratio Debt
Reconciliation
Refunding Capital Stock
Registrar
Regulation S
Regulation S Global Notes
Regulation S Notes
Regulation S Permanent Global Note
Regulation S Temporary Global Note
Reporting Entity
Restricted Notes Legend
Restricted Payments
Section
Appendix A
Appendix A
6.01
Preamble
Appendix A
3.10
3.10
3.10
3.10
3.10
4.06
Appendix A
Appendix A
12.01(1)
Appendix A
4.12(11)
Preamble
Preamble
Preamble
8.01(2)
4.12(b)
3.10
Preamble
Appendix A
6.01
6.01
4.06
2.04(a)
4.03(2)
5.01(1)
6.01
2.08
Appendix A
4.03(1)(a)
4.02(d)
4.04(b)(p)(i)
2.04(1)
Appendix A
Appendix A
Appendix A
Appendix A
Appendix A
4.02(b)
Appendix A
4.04(1)
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Term
Restricted Period
Retained Declined Proceeds
Retired Capital Stock
Reversion Date
Rule 144A
Rule 144A Global Notes
Rule 144A Notes
Rule 501
Special Change of Control Mandatory Redemption
Special Mandatory Redemption
Special Mandatory Redemption Date
Specified Transaction Adjustments
Successor Company
Successor Subsidiary Guarantor
Suspended Covenants
Testing Party
Transaction Election
Transaction Test Date
Transfer Restricted Definitive Notes
Transfer Restricted Global Notes
Transfer Restricted Notes
Treasury Equity Interests
Trustee
U.S. dollars
Unrestricted Definitive Notes
Unrestricted Global Notes
Verification Covenant
SECTION 1.03
Rules of Construction
. Unless the context otherwise requires:
Section
Appendix A
4.06
4.04(b)(b)(i)
4.15
Appendix A
Appendix A
Appendix A
Appendix A
3.11
3.10
3.10
1.05(c)
5.01(1)(a)
5.01(2)(a)
4.15
1.05(b)
1.05(f)
1.05(f)
Appendix A
Appendix A
Appendix A
4.04(2)(y)
Preamble
1.03(12)
Appendix A
Appendix A
6.01
(1)
(2)
(3)
(4)
(5)
(6)
a term has the meaning assigned to it;
an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;
“or” is not exclusive;
“including” means including without limitation;
words in the singular include the plural and words in the plural include the singular;
the words “herein,” “hereto” and “hereunder” and words of similar import shall refer to this Indenture as a
whole and not to any particular provision thereof;
(7)
unless otherwise indicated, references to an Exhibit, Appendix, Article, Section, clause or subclause refers to
the appropriate Exhibit, Appendix, Section, clause or subclause in this Indenture;
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Issuer;
(8)
(9)
unless otherwise indicated, all references to Restricted Subsidiaries shall mean Restricted Subsidiaries of the
unsecured Indebtedness shall not be deemed to be subordinate or junior to secured Indebtedness merely by
virtue of its nature as unsecured Indebtedness;
(10)
the principal amount of any non-interest bearing or other discount security at any date shall be the principal
amount thereof that would be shown on a balance sheet of the Issuer dated such date prepared in accordance with GAAP;
(11)
the principal amount of any Preferred Stock shall be (i) the maximum liquidation value of such Preferred
Stock or (ii) the maximum mandatory redemption or mandatory repurchase price with respect to such Preferred Stock, whichever
is greater;
(12)
unless otherwise specified herein, all accounting terms used herein shall be interpreted, all accounting
determinations hereunder shall be made, and all financial statements required to be delivered hereunder shall be prepared in
accordance with GAAP; and
(13)
“$” and “U.S. dollars” each refer to United States dollars, or such other money of the United States that at
the time of payment is legal tender for payment of public and private debts.
SECTION 1.04
No Incorporation by Reference of Trust Indenture Act
. This Indenture is not qualified under the TIA, and the TIA shall not apply to or in any way govern the terms of this
Indenture. The Issuer will not be required to comply with any provision of the TIA, including Sections 314(a) and 316(b) of the
TIA. As a result, no provisions of the TIA are incorporated into this Indenture unless expressly incorporated pursuant to this
Indenture.
SECTION 1.05
Measuring Compliance
.
(a)
Notwithstanding anything to the contrary herein, the First Lien Net Leverage Ratio, the Total Net Leverage
Ratio shall be calculated in the manner prescribed by this Section 1.05.
(b)
For purposes of calculating the First Lien Net Leverage Ratio, the Total Net Leverage Ratio, Specified
Transactions identified by the Issuer, any of its Restricted Subsidiaries, any Parent Entity, any successor entity of any of the
foregoing or a third party (the “Testing Party”) that have been made (i) during the applicable Test Period or (ii) subsequent to
such Test Period and prior to, simultaneously with or in connection with the event for which the calculation of any such ratio is
made shall be calculated on a Pro Forma Basis assuming that all such Specified Transactions (and any increase or decrease in
Consolidated Adjusted EBITDA and the component financial definitions used therein attributable to any Specified Transaction)
had occurred on the first day of the applicable Test Period. If since the beginning of any applicable Test Period any Person that
subsequently became a Restricted Subsidiary or was merged, amalgamated or consolidated with or into the Issuer or any of its
Restricted Subsidiaries since the beginning of such Test Period shall have made any Specified Transaction identified by the
Testing Party that would have required adjustment pursuant to this Section 1.05, then the First Lien Net Leverage Ratio, the Total
Net Leverage Ratio shall be calculated to give Pro Forma Effect thereto in accordance with this Section 1.05.
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(c)
Whenever Pro Forma Effect is to be given to a Specified Transaction, the pro forma calculations shall be
made in good faith by a responsible financial or accounting officer of the Testing Party and may include, for the avoidance of
doubt, the amount of “run rate” cost savings, operating expense reductions and synergies projected by the Testing Party in good
faith to result from actions taken, committed to be taken or expected to be taken (calculated on a pro forma basis as though such
cost savings, operating expense reductions and synergies had been realized on the first day of such Test Period and as if such cost
savings, operating expense reductions and synergies were realized during the entirety of such period) relating to such Specified
Transaction, net of the amount of actual benefits realized during such period from such actions (such cost savings, operating
expense reductions and synergies, “Specified Transaction Adjustments”); provided that (i) such Specified Transaction
Adjustments are reasonably identifiable, reasonably anticipated to be realized and factually supportable in the good faith
judgment of the Testing Party (it being agreed that such determination need not be made in compliance with Regulation S-X or
other applicable securities laws), (ii) such actions are taken, committed to be taken or expected to be taken no later than 36
months after the date of such Specified Transaction and (iii) no amounts shall be included pursuant to this paragraph to the extent
duplicative of any amounts that are otherwise included in calculating Consolidated Adjusted EBITDA, whether through a pro
forma adjustment or otherwise, with respect to any Test Period.
(d)
In the event that the Issuer or any Restricted Subsidiary Incurs (including by assumption or guarantees) or
repays (including by redemption, repayment, retirement or extinguishment) any Indebtedness included in the calculations of the
First Lien Net Leverage Ratio and the Total Net Leverage Ratio, as the case may be, (i) during the applicable Test Period or
(ii) subsequent to the end of the applicable Test Period and prior to, simultaneously with or in connection with the event for
which the calculation of any such ratio is made, then the First Lien Net Leverage Ratio and the Total Net Leverage Ratio shall be
calculated giving Pro Forma Effect to such Incurrence or repayment of Indebtedness, to the extent required, as if the same had
occurred on the last day of the applicable Test Period with respect to leverage ratios.
(e)
Notwithstanding anything in this Indenture to the contrary, (i) the Testing Party may rely on more than one
basket or exception hereunder (including both ratio-based and non-ratio based baskets and exceptions, and including partial
reliance on different baskets that, collectively, permit the entire proposed transaction) at the time of any proposed transaction, and
the Testing Party may, in its sole discretion, at any later time divide, classify or reclassify such transaction (or any portion
thereof) in any manner that complies with the available baskets and exceptions hereunder at such later time (provided that with
respect to reclassification of Indebtedness and Liens, any such reclassification shall be subject to Section 4.03 and Section 4.12
herein), as applicable, (ii) unless the Testing Party elects otherwise, if the Issuer or its Restricted Subsidiaries in connection with
any transaction or series of such related transaction (A) Incurs Indebtedness, issues Disqualified Stock or Preferred Stock, creates
Liens, makes Asset Sales, makes Investments, designates any Subsidiary as restricted or unrestricted, repays any Indebtedness,
makes any Restricted Payment or takes any other action under or as permitted by a ratio-based or borrowing-based basket and
(B) Incurs Indebtedness, creates Liens, makes Asset Sales, makes Investments, designates any Subsidiary as restricted or
unrestricted, makes any Restricted Payment or repays any Indebtedness or takes any other action under a non-ratio-based or non-
borrowing-based basket, then the applicable ratio will be calculated with respect to any such action under the applicable ratio-
based or borrowing-based basket without regard to any such
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action under such non-ratio-based or non-borrowing-based basket made in connection with such transaction or series of related
transactions, (iii) if the Issuer or its Restricted Subsidiaries enters into any revolving, delayed draw or other committed debt
facility, the Testing Party may elect to determine compliance of such debt facility (including the Incurrence of Indebtedness and
Liens from time to time in connection therewith) with this Indenture on the date commitments with respect thereto are first
received, assuming the full amount of such facility is Incurred (and any applicable Liens are granted) on such date, in which case
such committed amount may thereafter be borrowed or reborrowed, in whole or in part, from time to time, without further
compliance with such applicable ratio-based or borrowing-based basket hereunder, in lieu of determining such compliance on any
subsequent date (including any date on which Indebtedness is Incurred pursuant to such facility); provided that, in each case, any
future calculation of such ratio-based or borrowing-based basket shall only include the amount borrowed and outstanding as of
the date of determination, and (iv) if the Issuer or any Restricted Subsidiary Incurs Indebtedness under a ratio-based or
borrowing-based basket, such ratio-based or borrowing-based basket (together with any other ratio-based or borrowing-based
basket utilized in connection therewith, including in respect of other Indebtedness, Liens, Asset Sales, Investments, Restricted
Payments or payments in respect of Subordinated Indebtedness) will be calculated excluding the cash proceeds of such
Indebtedness for netting purposes (i.e., such cash proceeds shall not reduce the Issuer’s Consolidated Net Debt pursuant to clause
(b) of the definition of such term); provided that the actual application of such proceeds may reduce Indebtedness for purposes of
determining compliance with any such applicable ratio. For example, if the Issuer Incurs Indebtedness under the Fixed
Incremental Amount on the same date that it Incurs Indebtedness under the Ratio Incremental Debt, then the First Lien Net
Leverage Ratio and any other applicable ratio will be calculated with respect to such Incurrence under the Ratio Incremental Debt
without regard to any Incurrence of Indebtedness under the Fixed Incremental Amount or any other non-ratio based basket.
Unless the Testing Party elects otherwise, such Indebtedness shall be deemed incurred first under the Ratio Incremental Debt to
the extent permitted (and calculated prior to giving effect to any substantially simultaneous Incurrence of any Indebtedness based
on a basket or exception that is not based on a financial ratio, including under the Fixed Incremental Amount or clauses (a) and
(b) of Section 4.03(2)), with any balance incurred under any other clause of Section 4.03(2), including the Fixed Incremental
Amount, or as Ratio Debt. For purposes of determining compliance with Section 4.03, in the event that any Indebtedness (or any
portion thereof) meets the criteria of Ratio Incremental Debt or Fixed Incremental Amount, the Testing Party may, in its sole
discretion, at the time of Incurrence, divide, classify or reclassify, or at any later time divide, classify or reclassify, such
Indebtedness (or any portion thereof) in any manner that complies with Section 4.03 on the date of classification or
reclassification, as applicable. The Issuer hereby elects that on the Merger Date, the entire committed amount of the revolving
portion of the ABL Credit Agreement shall be deemed to have been incurred under Section 4.03(2)(b) and not under any ratio-
based or borrowing-based basket.
(f)
Notwithstanding anything in this Indenture to the contrary, when (i) calculating any applicable basket, ratio
or financial metric in connection with the Incurrence of Indebtedness, the creation of Liens, the making of any Asset Sale, the
making of an Investment, the making of a Restricted Payment, the designation of a Subsidiary as restricted or unrestricted, the
repayment of Indebtedness or for any other purpose, (ii) determining whether any Default or Event of Default has occurred, is
continuing or would result from any action, or (iii) determining compliance with any other condition precedent to any action or
transaction, in each case of clauses (i) through (iii) in connection with a Limited Condition Transaction, the date of determination
of such basket, ratio
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or financial metric, whether any Default or Event of Default has occurred, is continuing or would result therefrom, or the
satisfaction of any other condition precedent shall, at the option of the Testing Party (the Testing Party’s election to exercise such
option in connection with any Limited Condition Transaction, a “Transaction Election”), be deemed to be the date of declaration
of such Restricted Payment or the date that the definitive agreement for such Restricted Payment, Investment, acquisition, Asset
Sale or repayment, repurchase or refinancing of Indebtedness, Disqualified Stock or Preferred Stock is entered into, the date a
public announcement of an intention to make an offer in respect of the target of such acquisition or Investment or the date of such
notice, which may be conditional, of such repayment, repurchase or refinancing of Indebtedness, Disqualified Stock or Preferred
Stock is given to the holders of such Indebtedness, Disqualified Stock or Preferred Stock (any such date, the “Transaction Test
Date”). If on a Pro Forma Basis after giving effect to such Specified Transaction and the other transactions to be entered into in
connection therewith (including any Incurrence of Indebtedness and the use of proceeds thereof) such baskets, ratios, financial
metrics, absence of defaults, satisfaction of conditions precedent and other provisions are calculated as if such Specified
Transaction or other transactions had occurred at the beginning of the most recent Test Period ending prior to the Transaction Test
Date for which internal financial statements are available, the Testing Party could have taken such action on the relevant
Transaction Test Date in compliance with the applicable baskets, ratios, financial metrics or other provisions, such provisions
shall be deemed to have been complied with. For the avoidance of doubt, (i) if any of such baskets, ratios, financial metrics,
absence of defaults, satisfaction of conditions precedent or other provisions are exceeded or breached as a result of fluctuations in
such baskets, ratios and financial metrics (including due to fluctuations in Consolidated Net Income or Consolidated Adjusted
EBITDA of the Testing Party or any target company), a change in facts and circumstances or other provisions at or prior to the
consummation of the relevant Specified Transaction, such baskets, ratios, financial metrics, absence of defaults, satisfaction of
conditions precedent and other provisions will not be deemed to have been exceeded, breached, or otherwise failed as a result of
such fluctuations or changed circumstances solely for purposes of determining whether the Specified Transaction and any related
transactions is permitted hereunder and (ii) such baskets, ratios, financial metrics and compliance with such conditions shall not
be tested at the time of consummation of such Limited Condition Transaction or related Specified Transactions except as
contemplated in clause (a) of the immediately succeeding proviso; provided, however, that (a) if financial statements for one or
more subsequent fiscal quarters shall have become available, the Testing Party may elect, in its sole discretion, to re-determine all
such baskets, ratios and financial metrics on the basis of such financial statements, in which case such date of redetermination
shall thereafter be deemed to be the applicable Transaction Test Date for purposes of such baskets, ratios and financial metrics
and (b) if any ratios or financial metrics improve or baskets increase as a result of such fluctuations, such improved ratios,
financial metrics or baskets may be utilized. If the Testing Party has made a Transaction Election for any Limited Condition
Transaction or Specified Transaction, then in connection with any subsequent calculation of any ratio, financial metric or basket
availability with respect to any other Limited Condition Transaction or Specified Transaction or otherwise on or following the
relevant Transaction Test Date and prior to the earlier of the date on which such Limited Condition Transaction is consummated
or the date that the definitive agreement for such Limited Condition Transaction is terminated or expires without consummation
of such Limited Condition Transaction, any such ratio, financial metric or basket shall be calculated on a Pro Forma Basis
assuming such Limited Condition Transaction and other transactions in connection therewith
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(including any Incurrence of Indebtedness and the use of proceeds thereof) have been consummated. For the avoidance of doubt,
if the Testing Party has exercised its option pursuant to the foregoing and any Default, Specified Event of Default or Event of
Default occurs following the Transaction Test Date (including any new Transaction Test Date) for the applicable Limited
Condition Transaction or Specified Transaction and prior to or on the date of the consummation of such Limited Condition
Transaction or Specified Transaction, any such Default, Specified Event of Default or Event of Default shall be deemed to not
have occurred or be continuing for purposes of determining whether any action being taken in connection with such Limited
Condition Transaction or Specified Transaction is permitted under this Indenture.
(g)
Notwithstanding anything to the contrary, in connection with a Testing Party’s election to use a Transaction
Test Date in connection with a Limited Condition Transaction or Specified Transaction, any reference to “date of incurrence” or
“time of incurrence” or other similar phrases with respect to the date or time an action is taken herein will mean the Transaction
Test Date.
(h)
For purposes of determining the maturity date of any Indebtedness, (1) customary bridge loans that are
subject to customary conditions (as determined by the Issuer in good faith, including conditions requiring no payment or
bankruptcy event of default) that would either automatically be extended as, converted into or required to be exchanged for
permanent refinancing shall be deemed to have the maturity date as so extended, converted or exchanged and (2) in the case of
Indebtedness funded into escrow, that would be mandatorily repaid or redeemed if the conditions to release from escrow are not
met, such repayment or redemption shall not be considered.
SECTION 2.01
Amount of Notes
ARTICLE II
THE NOTES
. The aggregate principal amount of Notes which may be authenticated and delivered under this Indenture on the Issue
Date is $775,000,000.
The Issuer may from time to time after the Issue Date issue Additional Notes under this Indenture in an unlimited
principal amount, so long as (i) the Incurrence of the Indebtedness represented by such Additional Notes is at such time permitted
by Section 4.03 and (ii) such Additional Notes are issued in compliance with the other applicable provisions of this
Indenture. With respect to any Additional Notes issued after the Issue Date (except for Notes authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Notes pursuant to Sections 2.07, 2.08, 2.09, 3.08 or Appendix
A), there shall be (a) established in or pursuant to a resolution of the Board of Directors of the Issuer and (b) (i) set forth or
determined in the manner provided in an Officer’s Certificate or (ii) established in one or more indentures supplemental hereto,
prior to the issuance of such Additional Notes:
(1)
the aggregate principal amount of such Additional Notes which may be authenticated and delivered under
this Indenture;
(2)
the issue price and issuance date of such Additional Notes, including the date from which interest on such
Additional Notes shall accrue; and
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(3)
if applicable, that such Additional Notes shall be issuable in whole or in part in the form of one or more
Global Notes and, in such case, the respective depositaries for such Global Notes, the form of any legend or legends which shall
be borne by such Global Notes in addition to or in lieu of those set forth in Exhibit A hereto and any circumstances in addition to
or in lieu of those set forth in Section 2.2 of Appendix A in which any such Global Note may be exchanged in whole or in part
for Additional Notes registered, or any transfer of such Global Note in whole or in part may be registered, in the name or names
of Persons other than the depositary for such Global Note or a nominee thereof.
If any of the terms of any Additional Notes are established by action taken pursuant to a resolution of the Board of
Directors, a copy of an appropriate record of such action shall be certified by an Officer of the Issuer and delivered to the Trustee
at or prior to the delivery of the Officer’s Certificate or an indenture supplemental hereto setting forth the terms of the Additional
Notes.
The Initial Notes and any Additional Notes may, at the Issuer’s option, be treated as a single class for all purposes
under this Indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase; provided that if the
Additional Notes are not fungible with the Initial Notes for U.S. federal income tax purposes, the Additional Notes will have a
separate CUSIP number, if applicable.
SECTION 2.02
Form and Dating
. Provisions relating to the Notes (including Additional Notes) are set forth in Appendix A, which is hereby
incorporated in and expressly made a part of this Indenture. The (i) Initial Notes and the Trustee’s certificate of authentication
and (ii) any Additional Notes and the Trustee’s certificate of authentication shall each be substantially in the form of Exhibit A
hereto, which is hereby incorporated in and expressly made a part of this Indenture. The Notes may have notations, legends or
endorsements required by law, stock exchange rule, agreements to which the Issuer or any Guarantor is subject, if any, or usage
(provided that any such notation, legend or endorsement is in a form acceptable to the Issuer). Each Note shall be dated the date
of its authentication. The Notes shall be issuable only in registered form, without coupons, in minimum denominations of $2,000
and integral multiples of $1,000 in excess thereof.
SECTION 2.03
Execution and Authentication
. The Trustee shall authenticate and make available for delivery upon a written order of the Issuer signed by one
Officer of the Issuer (a) Initial Notes for original issue on the date hereof in an aggregate principal amount of $775,000,000 and
(b) subject to the terms of this Indenture, Additional Notes in an aggregate principal amount to be determined at the time of
issuance and specified therein. Such order shall specify the amount of separate Note certificates to be authenticated, the principal
amount of each of the Notes to be authenticated, the date on which the original issue of Notes is to be authenticated, whether the
Notes are to be Initial Notes or Additional Notes, the registered holder of each of the Notes and delivery instructions.
Notwithstanding anything to the contrary in this Indenture, no Opinion of Counsel shall be required for the Trustee to
authenticate and make available for delivery the Initial Notes. Notwithstanding anything to the contrary in this Indenture or
Appendix A, any issuance of Additional Notes after the Issue Date shall be in a principal amount of at least $2,000 and integral
multiples of $1,000 in excess thereof.
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One Officer shall sign the Notes for the Issuer by manual, facsimile or electronic signature.
If an Officer whose signature is on a Note no longer holds that office at the time the Trustee authenticates the Note, the
Note shall be valid nevertheless so long as such Officer held such office at the time of his or her execution thereof.
A Note shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on
the Note. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.
The Trustee may appoint one or more authenticating agents reasonably acceptable to the Issuer to authenticate the
Notes. Any such appointment shall be evidenced by an instrument signed by a Trust Officer, a copy of which shall be furnished
to the Issuer. Unless limited by the terms of such appointment, an authenticating agent may authenticate Notes whenever the
Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as any Registrar, Paying Agent or agent for service of notices and demands.
SECTION 2.04
Registrar and Paying Agent
.
(1)
The Issuer shall maintain (i) an office or agency where Notes may be presented for registration of transfer or
for exchange (the “Registrar”) and (ii) an office or agency where Notes may be presented for payment (the “Paying Agent”). The
Registrar shall keep a register of the Notes and of their transfer and exchange. The Issuer may have one or more co-registrars and
one or more additional paying agents. The term “Registrar” includes any co-registrars. The term “Paying Agent” includes the
Paying Agent and any additional paying agents. The Issuer initially appoints the Trustee as Registrar, Paying Agent and the
Notes Custodian with respect to the Global Notes.
(2)
The Issuer may enter into an appropriate agency agreement with any Registrar or Paying Agent not a party to
this Indenture. Such agreement shall implement the provisions of this Indenture that relate to such agent. The Issuer shall notify
the Trustee in writing of the name and address of any such agent. If the Issuer fails to maintain a Registrar or Paying Agent, the
Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.07. The Issuer or any of
its domestically organized Restricted Subsidiaries may act as Paying Agent or Registrar.
(3)
The Issuer may remove any Registrar or Paying Agent upon written notice to such Registrar or Paying Agent
and to the Trustee; provided, however, that no such removal shall become effective until (i) if applicable, acceptance of an
appointment by a successor Registrar or Paying Agent, as the case may be, as evidenced by an appropriate agreement entered into
by the Issuer and such successor Registrar or Paying Agent, as the case may be, and delivered to the Trustee or (ii) notification to
the Trustee that the Trustee shall serve as Registrar or Paying Agent until the appointment of a successor in accordance with
clause (i) above. The Registrar or Paying Agent may resign at any time upon written notice to the Issuer and the Trustee;
provided, however, that the Trustee may resign as Paying Agent or Registrar only if the Trustee also resigns as Trustee in
accordance with Section 7.08.
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SECTION 2.05
Paying Agent to Hold Money in Trust
. On or prior to each due date of the principal of, and premium (if any) and interest on, any Note, the Issuer shall
deposit with each Paying Agent (or if the Issuer or a Subsidiary is acting as Paying Agent, segregate and hold in trust for the
benefit of the Persons entitled thereto) a sum sufficient to pay such principal, premium (if any) and interest when so becoming
due. The Issuer shall require each Paying Agent (other than the Trustee) to agree in writing that a Paying Agent shall hold in
trust for the benefit of holders or the Trustee all money held by a Paying Agent for the payment of principal of, and premium (if
any) and interest on, the Notes, and shall notify the Trustee of any default by the Issuer in making any such payment. If the
Issuer or a Subsidiary of the Issuer acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it in
trust for the benefit of the Persons entitled thereto. The Issuer at any time may require a Paying Agent to pay all money held by it
to the Trustee and to account for any funds disbursed by such Paying Agent. Upon a bankruptcy of the Issuer, the Trustee shall
automatically become the Paying Agent. Upon complying with this Section 2.05, a Paying Agent shall have no further liability
for the money delivered to the Trustee.
SECTION 2.06
Holder Lists
. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the
names and addresses of holders. If the Trustee is not the Registrar, the Issuer shall furnish, or cause the Registrar to furnish, to
the Trustee, in writing at least five Business Days before each Interest Payment Date and at such other times as the Trustee may
request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of
holders.
SECTION 2.07
Transfer and Exchange
. The Notes shall be issued in registered form and shall be transferable only upon the surrender of a Note for
registration of transfer and in compliance with Appendix A. When a Note is presented to the Registrar with a request to register a
transfer, the Registrar shall register the transfer as requested if its requirements therefor are met. When Notes are presented to the
Registrar with a request to exchange them for an equal principal amount of Notes of other denominations, the Registrar shall
make the exchange as requested if the same requirements are met. To permit registration of transfers and exchanges, the Issuer
shall execute and the Trustee shall authenticate Notes at the Registrar’s request. The Issuer may require payment of a sum
sufficient to pay all taxes, assessments or other governmental charges in connection with any transfer or exchange pursuant to
this Section 2.07. The Issuer shall not be required to make, and the Registrar need not register, transfers or exchanges of Notes
selected for redemption (except, in the case of Notes to be redeemed in part, the portion thereof not to be redeemed) or of any
Notes for a period of 15 days before a selection of Notes to be redeemed or between a Record Date and the relevant Interest
Payment Date.
Prior to the due presentation for registration of transfer of any Note, the Issuer, the Guarantors, the Trustee, the Paying
Agent and the Registrar may deem and treat the Person in whose name a Note is registered as the absolute owner of such Note for
the purpose of receiving payment of principal of and interest, if any, on such Note and for all other purposes whatsoever, whether
or not such Note is overdue, and none of the Issuer, the Guarantors, the Trustee, the Paying Agent or the Registrar shall be
affected by notice to the contrary.
Any holder of a beneficial interest in a Global Note shall, by acceptance of such beneficial interest, agree that transfers
of beneficial interests in such Global Note may be effected only through a book-entry system maintained by (a) the holder of such
Global Note (or its agent) or
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(b) any holder of a beneficial interest in such Global Note, and that ownership of a beneficial interest in such Global Note shall be
required to be reflected in a book entry.
All Notes issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt and
shall be entitled to the same benefits under this Indenture as the Notes surrendered upon such transfer or exchange.
The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on
transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Note (including
any transfers between or among Depository participants or beneficial owners of interests in any Global Note) other than to
require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when
expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with
the express requirements hereof.
None of the Trustee, Registrar or Paying Agent shall have any responsibility for any actions taken or not taken by the
Depository.
SECTION 2.08
Replacement Notes
. If a mutilated Note is surrendered to the Registrar or if the holder of a Note claims that the Note has been lost,
destroyed or wrongfully taken, the Issuer shall issue and the Trustee shall, upon receipt of a written order, authenticate a
replacement Note if the requirements of Section 8-405 of the Uniform Commercial Code are met, such that the holder
(a) satisfies the Issuer and the Trustee within a reasonable time after such holder has notice of such loss, destruction or wrongful
taking and the Registrar does not register a transfer prior to receiving such notification, (b) makes such request to the Issuer and
the Trustee prior to the Note being acquired by a protected purchaser as defined in Section 8-303 of the Uniform Commercial
Code (a “protected purchaser”) and (c) satisfies any other reasonable requirements of the Issuer and the Trustee. If required by
the Trustee or the Issuer, such holder shall furnish an indemnity bond sufficient in the judgment of the Trustee, with respect to the
Trustee, and the Issuer, with respect to the Issuer, to protect the Issuer, the Trustee, the Paying Agent and the Registrar, as
applicable, from any loss or liability that any of them may suffer if a Note is replaced and subsequently presented or claimed for
payment. The Issuer and the Trustee may charge the holder for their expenses in replacing a Note (including without limitation,
attorneys’ fees and disbursements in replacing such Note). In the event any such mutilated, lost, destroyed or wrongfully taken
Note has become or is about to become due and payable, the Issuer in its discretion may pay such Note instead of issuing a new
Note in replacement thereof.
Every replacement Note is an additional obligation of the Issuer.
The provisions of this Section 2.08 are exclusive and shall preclude (to the extent lawful) all other rights and remedies
with respect to the replacement or payment of mutilated, lost, destroyed or wrongfully taken Notes.
SECTION 2.09
Outstanding Notes
. Notes outstanding at any time are all Notes authenticated by the Trustee except for those canceled by it, those
delivered to it for cancellation and those described in this Section 2.09 as not outstanding. Subject to Section 13.06, a Note does
not cease to be outstanding because the Issuer or an Affiliate of the Issuer holds the Note.
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If a Note is replaced pursuant to Section 2.08 (other than a mutilated Note surrendered for replacement), it ceases to be
outstanding unless the Trustee and the Issuer receive proof satisfactory to them that the replaced Note is held by a protected
purchaser. A mutilated Note ceases to be outstanding upon surrender of such Note and replacement thereof pursuant to
Section 2.08.
If a Paying Agent segregates and holds in trust, in accordance with this Indenture, on a redemption date or maturity
date money sufficient to pay all principal, premium (if any) and interest payable on that date with respect to the Notes (or
portions thereof) to be redeemed or maturing, as the case may be, and no Paying Agent is prohibited from paying such money to
the holders on that date pursuant to the terms of this Indenture, then on and after that date such Notes (or portions thereof) cease
to be outstanding and interest on them ceases to accrue.
SECTION 2.10
Cancellation
. The Issuer at any time may deliver Notes to the Trustee for cancellation. The Registrar and each Paying Agent shall
forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. The Trustee and no one
else shall cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall
dispose of canceled Notes in accordance with its customary procedures. The Issuer may not issue new Notes to replace Notes
they have redeemed, paid or delivered to the Trustee for cancellation. The Trustee shall not authenticate Notes in place of
canceled Notes other than pursuant to the terms of this Indenture.
SECTION 2.11
Defaulted Interest
. If the Issuer defaults in a payment of interest on the Notes, the Issuer shall pay the defaulted interest then borne by the
Notes (plus interest on such defaulted interest to the extent lawful) in any lawful manner. The Issuer may pay the defaulted
interest to the Persons who are holders on a subsequent special record date. The Issuer shall fix or cause to be fixed any such
special record date and payment date to the reasonable satisfaction of the Trustee and shall promptly send or cause to be sent to
each affected holder a notice that states the special record date, the payment date and the amount of defaulted interest to be paid.
SECTION 2.12
CUSIP Numbers, ISINs, Etc.
The Issuer in issuing the Notes may use CUSIP numbers, ISINs and “Common Code” numbers (if then generally in
use), and the Trustee shall use any such CUSIP numbers, ISINs and “Common Code” numbers in notices of redemption as a
convenience to holders; provided, however, that any such notice may state that no representation is made as to the correctness of
such numbers, either as printed on the Notes or as contained in any notice of a redemption that reliance may be placed only on
the other identification numbers printed on the Notes and that any such redemption shall not be affected by any defect in or
omission of such numbers. The Issuer shall advise the Trustee of any change in any such CUSIP numbers, ISINs and “Common
Code” numbers.
SECTION 2.13
Calculation of Principal Amount of Notes
. The aggregate principal amount of the Notes, at any date of determination, shall be the principal amount of the Notes
at such date of determination. With respect to any matter requiring consent, waiver, approval or other action of the holders of a
specified percentage of the principal amount of all the Notes, such percentage shall be calculated, on the relevant date of
determination, by dividing (a) the principal amount, as of such date of determination, of Notes, the holders of which have so
consented, by (b) the aggregate principal amount, as of such date of determination, of the Notes then outstanding,
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in each case, as determined in accordance with the preceding sentence, Section 2.09 and Section 13.06 of this Indenture.
SECTION 3.01
Optional Redemption
ARTICLE III
REDEMPTION
. The Notes may be redeemed, in whole or from time to time in part, subject to the conditions and at the redemption
prices set forth in Paragraph 5 of the Note set forth in Exhibit A hereto, which is hereby incorporated by reference and made a
part of this Indenture, together with accrued and unpaid interest, if any, to, but excluding, the redemption date (subject to the right
of holders of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date).
SECTION 3.02
Applicability of Article
. Redemption of Notes at the election of the Issuer or otherwise, as permitted or required by any provision of this
Indenture, shall be made in accordance with such provision and this Article III.
SECTION 3.03
Notices to Trustee
. If the Issuer elects to redeem Notes pursuant to the optional redemption provisions of Paragraph 5 of the Note, the
Issuer shall furnish to the Trustee, at least three Business Days for Global Notes and 10 days for Definitive Notes (or such shorter
period reasonably acceptable to the Trustee) before a notice of redemption is required to be mailed or otherwise delivered
pursuant to Section 3.05, an Officer’s Certificate setting forth: (i) the Section of this Indenture pursuant to which the redemption
shall occur, (ii) the redemption date, (iii) the principal amount of Notes to be redeemed and (iv) the redemption price, if then
ascertainable. The Issuer may also include a request in such Officer’s Certificate that the Trustee give the notice of redemption in
the Issuer’s name and at its expense and setting forth the information to be stated in such notice as provided in Section 3.05. Any
such notice may be canceled if written notice from the Issuer of such cancellation is actually received by the Trustee on the
Business Day immediately prior to notice of such redemption being mailed to any holder or otherwise delivered in accordance
with the applicable procedures of the Depository and shall thereby be void and of no effect. The Issuer shall deliver to the
Trustee such documentation and records as shall enable the Trustee to select the Notes to be redeemed pursuant to Section 3.04.
SECTION 3.04
Selection of Notes to Be Redeemed
. In the case of any partial redemption, selection of the Notes for redemption will be made by the Trustee in
compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed (and the
Issuer shall notify the Trustee of any such listing), or if the Notes are not so listed, on a pro rata basis to the extent practicable or
by lot or by such other method as the Trustee in its sole discretion shall deem fair and appropriate (and, in such manner that
complies with the requirements of the Depository, if applicable); provided that no Notes of $2,000 or less shall be redeemed in
part. The Trustee shall make the selection from outstanding Notes not previously called for redemption. The Trustee may select
for redemption portions of the principal of Notes that have denominations larger than $2,000. Notes and portions of them the
Trustee selects shall be in amounts of $2,000 or integral multiples of $1,000 in excess thereof. Provisions of this Indenture that
apply to Notes called for redemption also apply to portions of Notes called for redemption. The Trustee shall notify the Issuer
promptly in writing of the Notes or portions of Notes to be redeemed.
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SECTION 3.05
Notice of Optional Redemption
.
At least 10 but not more than 60 days before a redemption date pursuant to Paragraph 5 of the Note, the Issuer shall
mail or cause to be mailed by first-class mail, or otherwise deliver in accordance with the procedures of the Depository, a notice
of redemption to each holder whose Notes are to be redeemed at its registered address (with a copy to the Trustee), except that
redemption notices may be mailed or otherwise sent more than 60 days prior to the redemption date if (a) the notice is issued in
connection with a defeasance of the Notes or a satisfaction and discharge of this Indenture pursuant to Article VIII or (b) in case
of a redemption that is subject to one or more conditions precedent, the date of redemption is extended as permitted in this
Indenture.
Any such notice shall identify the Notes to be redeemed and shall state:
(1)
(2)
the redemption date;
the redemption price, or if not then ascertainable, the manner of calculation thereof, and the amount of
accrued interest to the redemption date;
(3)
(4)
the name and address of the Paying Agent;
that Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price,
plus accrued and unpaid interest, if any;
(5)
if fewer than all the outstanding Notes are to be redeemed, the aggregate principal amount of Notes to be
redeemed and the aggregate principal amount of Notes to be outstanding after such partial redemption;
(6)
that, unless the Issuer defaults in making such redemption payment, interest on Notes (or portion thereof)
called for redemption ceases to accrue on and after the redemption date (whether or not a Business Day);
(7)
(8)
the CUSIP number, ISIN and/or “Common Code” number, if any, printed on the Notes being redeemed;
that no representation is made as to the correctness or accuracy of the CUSIP number or ISIN and/or
“Common Code” number, if any, listed in such notice or printed on the Notes;
(9)
if the redemption is subject to the satisfaction of one or more conditions precedent, the notice thereof shall
describe each such condition and, if applicable, shall state that, in the Issuer’s sole discretion, the redemption date may be
delayed until such time as any or all such conditions are satisfied (or waived by the Issuer in its sole discretion), and/or such
redemption may not occur and such notice may be modified or rescinded in the event that any or all such conditions shall not
have been satisfied (or waived by the Issuer in its sole discretion) by the redemption date, or by the redemption date as so
delayed, and/or that such notice may be modified or rescinded at any time by the Issuer if the Issuer determines in its sole
discretion that any or all of such conditions will not be satisfied (or waived); and
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(10)
at the Issuer’s option, that the payment of the redemption price and performance of the Issuer’s obligations
with respect to such redemption may be performed by another Person.
Notice of any redemption upon any transaction or event (including any Equity Offering, Incurrence of Indebtedness,
Change of Control or other transaction) may be given prior to the completion thereof. In addition, any redemption or notice
thereof may, at the Issuer’s discretion, be subject to one or more conditions precedent, including, but not limited to, completion of
a transaction or other event. For the avoidance of doubt, if any redemption date shall be delayed as contemplated by this
Section 3.05 and the terms of the applicable notice of redemption, such redemption date as so delayed may occur at any time after
the original redemption date set forth in the applicable notice of redemption and after the satisfaction (or waiver) of any
applicable conditions precedent, including, without limitation, on a date that is less than 10 days after the original redemption
date or more than 60 days after the date of the applicable notice of redemption. To the extent that the redemption date will occur
on a date other than the original redemption date set forth in the applicable notice of redemption, the Issuer shall notify the
holders and the Trustee of the final redemption date prior to such date; provided that the failure to give such notice, or any defect
therein, shall not impair or affect the validity of any redemption under this Article III.
SECTION 3.06
Effect of Notice of Redemption
. Once notice of redemption is mailed or otherwise delivered in accordance with Section 3.05, Notes called for
redemption become due and payable on the redemption date (as such date may be extended or delayed) and at the redemption
price stated in the notice, except as provided in the final paragraph of Paragraph 5 of the Note or in Section 3.05. Upon surrender
to the Paying Agent, such Notes shall be paid at the redemption price stated in the notice, plus accrued and unpaid interest, if any,
to, but excluding, the redemption date; provided, however, that if the redemption date is after a regular Record Date and on or
prior to the next Interest Payment Date, the accrued interest shall be payable to the holder of the redeemed Notes registered on
the relevant Record Date. Failure to give notice or any defect in the notice to any holder shall not affect the validity of the notice
to any other holder. On or after the redemption date (whether or not a Business Day), interest shall cease to accrue on such Notes
or portions thereof called for redemption so long as the Issuer has deposited with the Paying Agent funds sufficient to pay the
principal of, plus premium (if any) and accrued and unpaid interest, if any, on the Notes or portions thereof to be redeemed,
pursuant to Section 3.07.
SECTION 3.07
Deposit of Redemption Price
. With respect to any Notes, prior to 11:00 a.m., New York City time, on the redemption date, the Issuer shall deposit,
or cause to be deposited, with the Paying Agent (or, if the Issuer or a Subsidiary of the Issuer is the Paying Agent, shall segregate
and hold in trust) money sufficient to pay the redemption price of, plus accrued and unpaid interest, if any, on all Notes or
portions thereof to be redeemed on that date other than Notes or portions of Notes called for redemption that have been delivered
by the Issuer to the Trustee for cancellation. The Trustee or the Paying Agent will promptly return to the Issuer any money
deposited with the Trustee or the Paying Agent by the Issuer in excess of the amounts necessary to pay the redemption or
purchase price of, and accrued and unpaid interest, if any, on the Notes or portions thereof to be redeemed or purchased. On and
after the redemption date (whether or not a Business Day), interest shall cease to accrue on Notes or portions thereof called for
redemption so long as the Issuer has deposited with the Paying Agent funds sufficient to pay the principal of, plus premium (if
any) and accrued and unpaid interest, if any, on the Notes or portions thereof to be redeemed.
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SECTION 3.08
Notes Redeemed in Part
. Upon surrender and cancellation of a Note that is redeemed in part, the Issuer shall issue and the Trustee shall
authenticate for the holder (at the Issuer’s expense) a new Note equal in principal amount to the unredeemed portion of the Note
surrendered and cancelled (or if the Note is a Global Note, an adjustment shall be made to the “Schedule of Increases or
Decreases in Global Note” attached thereto in accordance with the applicable procedures of the Depository).
SECTION 3.09
Mandatory Redemption
. The Issuer is not required to make mandatory redemption or sinking fund payments with respect to the Notes;
provided, however, that under certain circumstances, the Issuer may be required to offer to purchase Notes under Section 4.06
and Section 4.08. The Issuer or its Affiliates may at any time and from time to time purchase Notes. Any such purchases may be
made through open market or privately negotiated transactions with third parties or pursuant to one or more tender or exchange
offers or otherwise, upon such terms and at such prices as well as with such consideration as the Issuer or any such Affiliates may
determine.
SECTION 3.10
Escrow of Proceeds; Special Mandatory Redemption
. If the offering of the Notes closes prior to the Merger Date, concurrently with the closing of the offering of the Notes
on the Issue Date, the Escrow Issuer will enter into an escrow agreement (the “Escrow Agreement”) with the Trustee and the
Escrow Agent, pursuant to which the Escrow Issuer will deposit (or cause to be deposited) an amount in cash equal to the sum of
the amount of cash equal to the gross proceeds of the offering of the Notes (the “Escrowed Amount”) (together with any earnings
thereon and investments thereof, collectively the “Escrowed Funds”). An affiliate of Paper Excellence will also issue an
irrevocable equity commitment letter to the Issuer, for the benefit of the Trustee, the Escrow Agent and the holders of the Notes,
to transfer to the Issuer an amount necessary to fund (i) the payment of accrued and unpaid interest on the Notes in the event of a
Special Mandatory Redemption, plus certain fees and expenses and (ii) in the event the Escrow Release has not occurred on or
prior to the first interest payment date for the Notes, the payment of accrued and unpaid interest on the Notes through, but not
including, the first interest payment date for the Notes. The Escrow Issuer will grant the Trustee, for the benefit of itself and the
holders of the Notes, a first-lien priority security interest in an escrow account and all deposits and investments therein to secure
the Obligations under the Notes pending disbursement.
The Escrow Issuer will only be entitled to direct the Escrow Agent to release the Escrowed Funds in accordance with the
terms of the Escrow Agreement. Pursuant to the Escrow Agreement, the Escrow Agent will release the Escrowed Funds (the
“Escrow Release”) to the Escrow Issuer upon the presentation by the Escrow Issuer of an Officer’s Certificate addressed to the
Escrow Agent and the Trustee on or prior to the Outside Date, certifying that substantially concurrently with the Escrow Release,
the Merger will be consummated in accordance in all material respects with the Merger Agreement (including any permitted
amendments thereto) (or, if not in accordance with the Merger Agreement, in a manner not materially adverse to the holders) (the
“Escrow Condition”).
In the event that (a) the Merger Date does not take place on or prior to the Outside Date, (b) at any time prior to the Outside
Date, the Escrow Condition is deemed, in the good faith judgment of the Escrow Issuer or any direct or indirect parent of the
Escrow Issuer, to be incapable of being satisfied on or prior to the Outside Date or (c) at any time prior to the Outside Date, the
Merger
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Agreement is terminated in accordance with its terms without the closing of the Merger (any such event being a “Mandatory
Redemption Event”), the Escrow Issuer will redeem all of the Notes (the “Special Mandatory Redemption”) no later than three
Business Days following the Mandatory Redemption Event (or otherwise in accordance with the applicable procedures of the
Depository) (the “Special Mandatory Redemption Date”) at the Special Mandatory Redemption Price.
If the Escrow Agent (i) has not received an Officer’s Certificate at or prior to 11:00 a.m. (New York City time) on the
Outside Date or (ii) has received an escrow termination notice from the Escrow Issuer prior to the Outside Date, then the Escrow
Agent promptly after 11:00 a.m. (New York City time) on the Outside Date or the date on which it has received an escrow
termination notice (as applicable) will liquidate the Escrowed Funds and, on or prior to the Special Mandatory Redemption Date,
release (x) an amount of Escrowed Funds to the Trustee equal to the Special Mandatory Redemption Price and (y) after payment
of any amounts due to the Trustee, the Collateral Agent and the Escrow Agent, any remaining amount of Escrowed Funds to the
Escrow Issuer.
SECTION 3.11
Special Change of Control Mandatory Redemption
. If the Special Change of Control Mandatory Redemption Amount is greater than $2,000, the Issuer will redeem (such
mandatory redemption, the “Special Change of Control Mandatory Redemption”), on the third Business Day following the
expiration time in the Existing Notes Change of Control Offers (or otherwise in accordance with the applicable procedures of the
Depository), a principal amount of the Notes equal to the Special Change of Control Mandatory Redemption Amount at a
redemption price equal to 100.0% of the initial issue price of the Notes, plus accrued and unpaid interest to, but not including, the
date of such redemption. Concurrently with the Escrow Release, the Issuer will deposit $250,000,000 gross proceeds from the
offering of the Notes into a segregated and restricted account pending consummation of the Existing Notes Change of Control
Offers (however, for the avoidance of doubt, such account shall not be an “escrow” account).
SECTION 4.01
Payment of Notes
ARTICLE IV
COVENANTS
. The Issuer will promptly pay or cause to be paid the principal of, premium on, if any, and interest, if any, on, the
Notes on the dates and in the manner provided in the Notes and in this Indenture. Principal, premium, if any, and interest, if any,
will be considered paid on the date due if the Paying Agent, if other than the Issuer or a Subsidiary thereof, holds as of 11:00 a.m.
New York City time on the due date money deposited by the Issuer in immediately available funds and designated for and
sufficient to pay all principal, premium, if any, and interest, if any, then due.
The Issuer will pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue
principal at a rate that is 1% higher than the then applicable interest rate on the Notes to the extent lawful; it will pay interest
(including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest at the same
stepped-up rate to the extent lawful.
SECTION 4.02
Reports and Other Information
.
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(a)
For so long as any Notes are outstanding, the Issuer shall deliver to the Trustee a copy of all of the
information and reports referred to below:
(1)
within 120 days after the end of each fiscal year of the Issuer or, in the case of the first fiscal year
ending after the Issue Date, within 150 days, a consolidated balance sheet of the Reporting Entity and its Subsidiaries
as at the end of such fiscal year, and the related consolidated statements of income or operations, stockholders’ equity
and cash flows for such fiscal year together with related notes thereto, setting forth in each case in comparative form
the figures for the previous fiscal year (if ending after the Issue Date), prepared in accordance with GAAP, audited and
accompanied by a report and opinion of the Reporting Entity’s auditor on the Issue Date or any other independent
registered public accounting firm of nationally recognized standing;
(2)
within 45 days after the end of the first three fiscal quarters of each fiscal year of the Issuer or, in
the case of the first two such fiscal quarters ending after the Issue Date, within 75 days, a condensed consolidated
balance sheet of the Reporting Entity and its Subsidiaries as at the end of such fiscal quarter and the related condensed
consolidated statements of income or operations for the portion of the fiscal year then ended or for such fiscal quarter
and a condensed consolidated statements of cash flows for the portion of the fiscal year then ended or for such fiscal
quarter, setting forth in comparative form the figures for the corresponding portion of the previous fiscal year or
previous fiscal quarter, as applicable, if ended after the Issue Date;
(3)
within 15 days after the time period specified in the SEC’s rules and regulations for filing current
reports on Form 8-K, current reports of the Reporting Entity containing substantially all of the information that would
be required to be filed in a current report on Form 8-K under the Exchange Act on the Issue Date pursuant to Items
1.01, 1.02, 1.03 (with respect to the Issuer or a Significant Subsidiary), 2.01, 4.01 (with respect the Issuer) and 4.02
(with respect to the Issuer) (in each case, excluding the financial statements, pro forma financial information and
exhibits, if any, that would be required by Item 9.01) of Form 8-K if the Reporting Entity had been a reporting
company under the Exchange Act; provided, however, that no such current report will be required to be furnished if the
Issuer determines in its good faith judgment that such event is not material to holders or the business, assets, operations,
financial position or prospects of the Issuer and the Restricted Subsidiaries, taken as a whole, and the Issuer may omit
from such disclosure any terms of such event if the Issuer determines in its good faith judgment that disclosure of such
terms would otherwise cause material competitive harm to the business, assets, operations, financial position or
prospects of the Issuer and the Restricted Subsidiaries, taken as a whole; provided that such non-disclosure shall be
limited only to those specific provisions that would cause material competitive harm and not the occurrence of the
event itself; provided, further, that no such current report will be required to include a summary of the terms of, any
employment or compensatory arrangement agreement, plan or understanding between the Issuer (or any Parent Entity
or any of the Issuer’s Subsidiaries) and any director, manager or executive officer, of the Issuer (or any Parent Entity or
any of the Issuer’s Subsidiaries); and
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(4)
simultaneously with the delivery of each set of financials described in clauses (1) and (2) of this
Section 4.02, a management’s discussion and analysis describing results of operations in form consistent with the
presentation in the Offering Memorandum.
(b)
The Issuer shall conduct quarterly conference calls with management of the Issuer and the holders of the
Notes and securities analysts (to the extent providing analysis of investment in the Notes) (which conference calls may be
combined with any conference calls for the holders of the Issuer’s or any Parent Entity’s other securities), and in each case,
subject to the requirements of this Section 4.02, within 15 Business Days after the time period set forth in clause (c) below with
respect to delivery of the financial statements required by clauses (a)(1) and (a)(2) of this Section 4.02, to discuss the financial
performance of the Issuer and its Restricted Subsidiaries for the most recently ended fiscal year or fiscal quarter, as the case may
be, for which financial statements have been delivered pursuant to clauses (a)(1) or (2) of this Section 4.02.
(c)
In addition to providing such information to the Trustee, the Issuer shall make available to the holders, bona
fide prospective investors, market makers affiliated with any initial purchaser of the Notes and bona fide securities analysts the
information required to be provided pursuant to clauses (a)(1), (a)(2) and (a)(3) of this Section 4.02, by posting such information
within 15 days after the date on which the Issuer is required to provide such information to the Trustee to the Issuer’s website (or
the website of any of the Issuer’s Subsidiaries or any Parent Entity, including the Reporting Entity) or on IntraLinks or any
comparable password protected online data system or website.
(d)
Notwithstanding the foregoing, (a) neither the Issuer nor another Reporting Entity will be required to deliver
any information, financial statements, certificates or reports that would otherwise be required by (i) Section 302, Section 404 or
Section 906 of the Sarbanes-Oxley Act of 2002, or related Items 307 or 308 of Regulation S-K, or (ii) Regulation G or Item 10(e)
of Regulation S-K promulgated by the SEC with respect to any non-generally accepted accounting principles financial measures
contained therein, (b) such reports will not be required to contain financial information required by Rule 3-05, Rule 3-09, Rule 3-
10 or Rule 3-16 of Regulation S-X or include any exhibits or certifications required by Form 10-K, Form 10-Q or Form 8-K (or
any successor or comparable forms) or related rules under Regulation S-K, (c) such reports shall be subject to exceptions,
exclusions and other differences consistent with the presentation of financial and other information in the Offering Memorandum
and shall not be required to present compensation or beneficial ownership information (including, for the avoidance of doubt, any
information required by Item 402 of Regulation S-K), (d) no such report will be required to include as an exhibit, or to include a
summary of the terms of, any employment or compensatory arrangement agreement, plan or understanding between the Issuer (or
any Parent Entity or Subsidiary) and any director, manager or executive officer of the Issuer (or any Parent Entity or Subsidiary),
(e) trade secrets and other proprietary information may be excluded from any disclosures, (f) such information will not be
required to contain any “segment reporting” and (g) if at any time any Reporting Entity has made a good faith determination to
file a registration statement with the SEC with respect to an Equity Offering of such entity’s Equity Interests, the Issuer will still
be required to provide reports pursuant to this Section 4.02 but the content of such reports will not be required to disclose any
information that, in the good faith view of the Issuer or a Parent Entity, would violate the securities laws or the SEC’s “gun
jumping” rules or otherwise have an adverse effect on such Equity Offering; provided that no such report shall be required to
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be furnished if the Issuer determines in its good faith judgment that such event is not material to the holders or the business,
assets, operations, financial position or prospects of the Issuer and its Restricted Subsidiaries, taken as a whole.
(e)
The financial statements, information and other documents required to be provided pursuant to this Section
4.02 may be those of (i) the Issuer, (ii) any Parent Entity or (iii) any Wholly Owned Subsidiary of the Issuer that, together with its
Subsidiaries, constitutes substantially all the assets and liabilities of the Issuer and its consolidated Subsidiaries (any such entity
described in clause (i), (ii) or (iii) , a “Reporting Entity”), so long as in the case of clause (ii) either (1) such Parent Entity shall
not conduct, transact or otherwise engage, or commit to conduct, transact or otherwise engage, in any material business or
operations other than its direct or indirect ownership of all of the Equity Interests in, and its management, of the Issuer, (2) such
Parent Entity is or elects to become a Guarantor or (3) if otherwise, the financial information so delivered shall be accompanied
by (or available on a password protected online data system or website) a reasonably detailed description of the material
quantitative differences (the “Reconciliation”) between the information relating to such parent, on the one hand, and the
information relating to the Issuer and the Restricted Subsidiaries on a standalone basis, on the other hand but only to the extent
there are quantitative material differences (which for the avoidance of doubt need not be audited or reviewed by the auditors or
included in the financial statements).
(f)
The Issuer has agreed that, for so long as any Notes remain outstanding during any period when neither it nor
another Reporting Entity is subject to Section 13 or 15(d) of the Exchange Act, or otherwise permitted to furnish the SEC with
certain information pursuant to Rule 12g3-2(b) of the Exchange Act, it will furnish to the holders of the Notes and to prospective
investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
(g)
For so long as the Issuer has designated certain of its Subsidiaries as Unrestricted Subsidiaries, then the
quarterly and annual financial information required by this Section 4.02 will include a reasonably detailed presentation (which
need not be audited or reviewed by the auditors), either on the face of the financial statements or in the footnotes thereto or in the
report accompanying any such financial statements of the financial condition and results of operations of the Issuer and its
Restricted Subsidiaries separate from the financial condition and results of operations of the Unrestricted Subsidiaries of the
Issuer.
(h)
Notwithstanding the foregoing, the Issuer will be deemed to have delivered such reports and information
referred to above to the holders, bona fide prospective investors, market makers affiliated with any initial purchasers of the Notes,
bona fide securities analysts and the Trustee for all purposes of this Indenture if the Issuer or another Reporting Entity has filed
such reports with the SEC via the EDGAR filing system (or any successor system) and such reports are publicly available. For
the avoidance of doubt, if a Reporting Entity files such reports with the SEC via the EDGAR filing system (or any successor
system), a Reconciliation is only required to be provided to the Trustee, the holders, bona fide prospective investors, market
makers affiliated with any initial purchasers of the Notes and bona fide analysts of the Notes if a Reconciliation is required
pursuant to Section 4.02(e), and any such Reconciliation will accompany the applicable report so filed (or be made available on a
password protected online data system or website) and such Reconciliation need not be audited or reviewed by the auditors or
included in the financial
81
statements. In addition, the requirements of this Section 4.02 will be deemed satisfied and the Issuer will be deemed to have
delivered such reports and information referred to above to the Trustee, holders, bona fide prospective investors, market makers
affiliated with any initial purchasers of the Notes and bona fide securities analysts for all purposes of this Indenture by the posting
of reports and information that would be required to be provided on the Issuer’s website (or that of any of the Issuer’s
Subsidiaries or any Parent Entity, including the Reporting Entity). If any financial statements that have been previously delivered
are required to be restated, such financial statements shall still be deemed to have been delivered on the initial date of delivery
while any such restatement is ongoing.
(i)
Any person who requests or accesses such financial information or attend any conference calls required by
this Section 4.02 may be required to provide its email address, employer name and other information reasonably requested by the
Issuer and represent to the Issuer (to the Issuer’s reasonable good faith satisfaction) that:
(1)
it is a holder of the Notes, a beneficial owner of the Notes, a bona fide prospective investor in the
Notes, a market maker in the Notes affiliated with any initial purchaser of the Notes or a bona fide securities analyst
providing an analysis of investment in the Notes;
(2)
(3)
any Person; and
it will not use the information in violation of applicable securities laws or regulations;
it will keep such provided information confidential and will not communicate the information to
(4)
it (a) will not use such information in any manner intended to compete with the business of the
Issuer and its Subsidiaries and (b) is not a Person (which includes such Person’s Affiliates) that (i) is principally
engaged in a Similar Business or (ii) derives a significant portion of its revenues from operating or owning a Similar
Business.
Notwithstanding anything herein to the contrary, any failure to comply with this Section 4.02 shall be automatically
cured when the Issuer or any Parent Entity, as the case may be, makes available all required reports to the noteholders or files all
required reports with the SEC via the EDGAR filing system (or any successor system).
Delivery of reports, information and documents to the Trustee pursuant to this Section 4.02 is for informational
purposes only, and the information and the Trustee’s and Collateral Agent’s receipt thereof shall not constitute actual or
constructive notice of any information contained therein, or determinable from information contained therein, including the
Issuer’s compliance with any of its covenants under this Indenture (as to which the Trustee and/or the Collateral Agent are
entitled to rely exclusively on an Officer’s Certificate). Neither the Trustee nor the Collateral Agent shall have no duty to review
or analyze reports delivered to it or monitor whether any such reports have been filed with the SEC or the Issuer’s website. The
Trustee shall have no responsibility for determining whether a Reconciliation is required to be given.
SECTION 4.03
Limitation on Incurrence of Indebtedness and Issuance of Disqualified Stock and Preferred
Stock
.
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(1)
The Issuer will not, and will not permit any of the Restricted Subsidiaries to, directly or indirectly, Incur any
Indebtedness (including Acquired Indebtedness) or issue any shares of Disqualified Stock; and the Issuer will not permit any of
the Restricted Subsidiaries (other than a Subsidiary Guarantor) to issue any shares of Preferred Stock; provided, however, that the
Issuer and any Subsidiary Guarantor may Incur Indebtedness (including Acquired Indebtedness) or issue shares of Disqualified
Stock, and any Restricted Subsidiary of the Issuer that is not a Subsidiary Guarantor may Incur Indebtedness (including Acquired
Indebtedness), issue shares of Disqualified Stock or issue shares of Preferred Stock:
(a)
if the Total Net Leverage Ratio for the relevant Test Period is equal to or less than the Closing Date
Total Net Leverage Ratio (such Indebtedness, Disqualified Stock or Preferred Stock Incurred or issued pursuant to this
clause (a), the “Ratio Debt”); and
(b)
any Permitted Refinancing of Indebtedness, Disqualified Stock or Preferred Stock Incurred as Ratio
Debt plus any Additional Refinancing Amount (if applicable);
provided that the aggregate principal amount of Indebtedness (including Acquired Indebtedness) outstanding at any one
time that may be Incurred and may be issued pursuant to clauses (a) and (b) of this Section 4.03(1) by non-Guarantor
Subsidiaries shall not exceed, when taken together with amounts incurred under Section 4.03(2)(i) below by non-
Guarantor Subsidiaries, the greater of (x) 100.0% of Closing Date EBITDA and (y) 100.0% of TTM Consolidated
Adjusted EBITDA as of the date of determination.
(2)
The limitations set forth in Section 4.03(1) shall not apply to (collectively, “Permitted Debt”):
(a)
the Incurrence by the Issuer or its Restricted Subsidiaries of Indebtedness or Disqualified Stock or
the issuance by its Subsidiaries that are not Subsidiary Guarantors of Preferred Stock under any Bank Indebtedness, the
guarantees thereof and the issuance and creation of letters of credit and bankers’ acceptances thereunder (with letters of
credit and bankers’ acceptances being deemed to have a principal amount equal to the face amount thereof) up to an
aggregate principal amount or liquidation preference, if applicable, at any one time outstanding, not to exceed
$775,000,000 plus, in connection with any Permitted Refinancing incurred pursuant to this clause (a), any Additional
Refinancing Amount (if applicable);
(b)
the Incurrence by the Issuer or its Restricted Subsidiaries of Indebtedness or Disqualified Stock or
the issuance by its Subsidiaries that are not Subsidiary Guarantors of Preferred Stock under any Bank Indebtedness, the
guarantees thereof and the issuance and creation of letters of credit and bankers’ acceptances thereunder (with letters of
credit and bankers’ acceptances being deemed to have a principal amount equal to the face amount thereof) up to an
aggregate principal amount or liquidation preference, if applicable, at any one time outstanding, not to exceed the
greater of (x)(a) $400,000,000 plus (b) the greater of 50.0% of Closing Date EBITDA and 50.0% of TTM Consolidated
Adjusted EBITDA and (b) the Borrowing Base (without giving any effect to any eligibility or reserve provisions
therein), and in each case, plus, in connection with any Permitted
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Refinancing incurred pursuant to this clause (b), any Additional Refinancing Amount (if applicable);
(c)
(i) Indebtedness outstanding on the Merger Date (including any Existing Notes that remain
outstanding on the Merger Date; provided that, for purposes of available capacity pursuant to this subclause (i), the
aggregate principal amount of the Existing Notes outstanding on the Merger Date shall be reduced by the aggregate
principal amount of the Existing Notes, if any, redeemed by the Issuer pursuant to the Existing Notes Change of
Control Offers) and (ii) any Permitted Refinancing incurred pursuant to this clause (c) plus any Additional Refinancing
Amount (if applicable); other than, in the case of each of clauses (i) and (ii), Indebtedness Incurred pursuant to clause
(a) or (b) of this Section 4.03(2);
(d)
Indebtedness or shares of Disqualified Stock of the Issuer or any Restricted Subsidiary owing to the
Issuer or any Restricted Subsidiary; provided that all such Indebtedness or shares of Disqualified Stock of the Issuer
and any Subsidiary Guarantor owed to any Restricted Subsidiary that is not a Subsidiary Guarantor shall be (except in
respect of intercompany current liabilities Incurred in the ordinary course of business in connection with the cash
management, tax and accounting operations of the Issuer and its Subsidiaries), subordinated in right of payment to the
Notes or the Guarantee of such Subsidiary Guarantor, as applicable (but only to the extent permitted by applicable
Law);
(e)
(i) (A) Indebtedness (including Capitalized Leases) of the Issuer or any Restricted Subsidiary,
Disqualified Stock issued by the Issuer or any Restricted Subsidiary and Preferred Stock issued by any Restricted
Subsidiary financing the acquisition, construction, repair, replacement or improvement of fixed or capital assets,
including through the direct purchase of assets or the Equity Interests of any Person owning such assets; provided that
such Indebtedness is Incurred concurrently with, or within 270 days after, the applicable acquisition, construction,
repair, replacement or improvement; and (B) Indebtedness arising from the conversion of obligations of the Issuer or
any Restricted Subsidiary under or pursuant to any “synthetic lease” transactions to Indebtedness of the Issuer or any
Restricted Subsidiary; provided that the aggregate principal amount of such Indebtedness Incurred and then outstanding
pursuant to this clause (e)(i), other than Capitalized Lease Obligations, after giving Pro Forma Effect thereto, shall not
exceed the greater of (I) 25.0% of Closing Date EBITDA and (II) 25.0% of TTM Consolidated Adjusted EBITDA as of
the applicable date of determination; and (ii) any Permitted Refinancing incurred pursuant to this clause (e) plus any
Additional Refinancing Amount (if applicable); provided that for the purposes of determining compliance with this
clause (e), any lease that is not treated under GAAP as a capital lease at the time such lease is executed but is
subsequently treated under GAAP as a capitalized lease as the result of a change in GAAP (or interpretations thereof)
after the Issue Date shall not be treated as Indebtedness (it being understood that any Indebtedness Incurred or
Disqualified Stock or Preferred Stock issued pursuant to this clause (e) shall cease to be deemed Incurred, issued or
outstanding pursuant to this clause (e) but shall be deemed Incurred or issued and outstanding as Ratio Debt from and
after the first date on which the Issuer or such Restricted Subsidiary, as the case may be, could have Incurred such
Indebtedness or issued such Disqualified Stock or Preferred Stock as Ratio Debt (to the extent the Issuer or such
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Restricted Subsidiary is able to Incur the Liens on such Ratio Debt pursuant to Section 4.12 after such
reclassification));
(f)
[reserved];
(g)
(i) Indebtedness of the Issuer or any Restricted Subsidiary in an aggregate principal amount
Incurred and then outstanding pursuant to this clause (g)(i) not exceeding the Fixed Incremental Amount at such time
and (ii) any Permitted Refinancing incurred pursuant to this clause (g) plus any Additional Refinancing Amount (if
applicable);
(h)
shares of Preferred Stock of a Restricted Subsidiary issued to the Issuer or another Restricted
Subsidiary; provided that any subsequent issuance or transfer of any Capital Stock or any other event which results in
any Restricted Subsidiary that holds such shares of Preferred Stock of another Restricted Subsidiary ceasing to be a
Restricted Subsidiary or any other subsequent transfer of any such shares of Preferred Stock (except to the Issuer or
another Restricted Subsidiary) shall be deemed, in each case, to be an issuance of shares of Preferred Stock not
permitted by this clause (h);
(i)
(i) Ratio Incremental Debt and (ii) any Permitted Refinancing incurred pursuant to this clause (i)
plus any Additional Refinancing Amount (if applicable); provided that the aggregate principal amount of Indebtedness
(including Acquired Indebtedness) outstanding at any one time that may be Incurred and may be issued pursuant to this
clause (i) by non-Guarantor Subsidiaries shall not exceed, when taken together with amounts incurred as Ratio Debt by
non-Guarantor Subsidiaries, the greater of (x) 100.0% of Closing Date EBITDA and (y) 100.0% of TTM Consolidated
Adjusted EBITDA as of the date of determination;
(j)
(i) Indebtedness Incurred or Disqualified Stock or Preferred Stock issued by a Restricted Subsidiary
that is not a Subsidiary Guarantor; provided that the aggregate principal amount or liquidation preference of such
Indebtedness Incurred or Disqualified Stock or Preferred Stock issued and then outstanding pursuant to this clause (j)(i)
after giving Pro Forma Effect thereto, shall not exceed the greater of (I) 25.0% of Closing Date EBITDA and (II)
25.0% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination, (ii) Indebtedness that is
recourse only to Excluded Assets and (iii) any Permitted Refinancing incurred pursuant to this clause (j) plus any
Additional Refinancing Amount (if applicable) (it being understood that any Indebtedness Incurred or Disqualified
Stock or Preferred Stock issued pursuant to this clause (j) shall cease to be deemed Incurred, issued or outstanding
pursuant to this clause (j) but shall be deemed Incurred or issued and outstanding as Ratio Debt from and after the first
date on which the Issuer or such Restricted Subsidiary, as the case may be, could have Incurred such Indebtedness or
issued such Disqualified Stock or Preferred Stock as Ratio Debt (to the extent the Issuer or such Restricted Subsidiary
is able to Incur the Liens on such Ratio Debt pursuant to Section 4.12 after such reclassification));
(k)
Indebtedness in respect of Hedge Agreements, in each case not Incurred for speculative purposes;
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(l)
Indebtedness, Disqualified Stock or Preferred Stock,
(i)
that is Indebtedness, Disqualified Stock or Preferred Stock of any Person that becomes a
Restricted Subsidiary after the Issue Date pursuant to an Investment permitted under this Indenture, which
Indebtedness, Disqualified Stock or Preferred Stock is existing at the time such Person becomes a Restricted
Subsidiary or is merged with or into a Restricted Subsidiary or with respect to a line of business or other
assets acquired after the Issue Date; provided that (I) such Indebtedness, Disqualified Stock or Preferred
Stock was not created in contemplation thereof, (II) such Indebtedness, Disqualified Stock or Preferred Stock
is non-recourse to (and is not assumed by any of) the Issuer or any other Restricted Subsidiary (other than
any Subsidiary of such Person that is a Subsidiary of such Person on the date such Person becomes a
Restricted Subsidiary) and (III) such Indebtedness, Disqualified Stock or Preferred Stock is either (A)
unsecured or (B) secured only by the assets of such Restricted Subsidiary by Liens permitted under Section
4.12 or the definition of “Permitted Liens”;
(ii)
that is Indebtedness, Disqualified Stock or Preferred Stock constituting indemnification
obligations or obligations in respect of purchase price or other similar adjustments (including seller notes,
“earn-outs” and deferred payments) Incurred prior to the Issue Date or in connection with an acquisition,
Investment, Asset Sale, or other transaction, in each case permitted by this Indenture; or
(iii)
that is Indebtedness, Disqualified Stock or Preferred Stock consisting of obligations under
deferred compensation or other similar arrangements Incurred prior to the Issue Date or in connection with an
acquisition, Investment or other transaction, in each case, permitted by this Indenture;
(iv)
(v)
[reserved];
any Permitted Refinancing of Indebtedness Incurred or shares of Disqualified Stock or
Preferred Stock issued pursuant to this clause (l) plus any Additional Refinancing Amount (if applicable);
(m)
(i) Contribution Indebtedness and (ii) any Permitted Refinancing incurred pursuant to this clause
(m) plus any Additional Refinancing Amount (if applicable);
(n)
course of business;
Indebtedness Incurred in connection with the financing of insurance premiums in the ordinary
(o)
(i) Indebtedness Incurred in connection with any Sale/Leaseback Transaction; provided that for the
purposes of determining compliance with this clause (o), Indebtedness shall not be deemed to arise from a lease entered
into in connection with a Sale/Leaseback Transaction that is treated under GAAP as a lease that is not a Capitalized
Lease at the time such Sale/Leaseback Transaction is consummated but is subsequently treated under GAAP as a
Capitalized Lease as the result of a change in GAAP (or
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interpretations thereof) after the Issue Date and (ii) any Permitted Refinancing incurred pursuant to this clause (o) plus
any Additional Refinancing Amount (if applicable);
(p)
Indebtedness Incurred in connection with a Qualified Securitization Financing that is not recourse
(except for Standard Securitization Undertakings) to the Issuer or any of the Restricted Subsidiaries;
(q)
(i) Indebtedness supported by a letter of credit or bank guaranty supporting trade payables,
warehouse receipts or similar facilities in a principal amount not to exceed the face amount of such letter of credit;
provided that such letter of credit or bank guaranty is permitted to be Incurred by this Indenture, if the Issuer or any
Restricted Subsidiary is the account party, and is established, extended and maintained in the ordinary course of
business or consistent with past practice, (ii) Indebtedness in respect of letters of credit or bank guarantees permitted to
be issued hereunder that are cash collateralized and (iii) Indebtedness Incurred by the Issuer or any Restricted
Subsidiary in respect of letters of credit, bank guarantees, bankers’ acceptances, warehouse receipts or similar
instruments issued or created, or related to obligations or liabilities incurred, in the ordinary course of business or
consistent with past practice (including in favor of suppliers, trade creditors and landlords and in respect of workers
compensation claims, health, disability or other employee benefits, or property, casualty or liability insurance or self-
insurance, or other reimbursement-type obligations regarding workers compensation claims) or in connection with the
enforcement of rights or claims of the Issuer or any Restricted Subsidiary in connection with any judgment that has not
resulted in an Event of Default pursuant to Section 6.01(7);
(r)
(i) obligations in respect of cash management services and (ii) Indebtedness in respect of netting
services, automatic clearinghouse arrangements, overdraft protections, employee credit card programs and other cash
management and similar arrangements, in each case, Incurred in the ordinary course of business or consistent with past
practice;
(s)
(i) Indebtedness Incurred or Disqualified Stock or Preferred Stock issued on behalf of, or
representing guarantees of Indebtedness, Disqualified Stock or Preferred Stock of, any Joint Ventures; provided that the
aggregate principal amount or liquidation preference of such Indebtedness Incurred or Disqualified Stock or Preferred
Stock issued and then outstanding pursuant to this clause (s)(i), after giving Pro Forma Effect thereto, shall not exceed
the greater of (I) 25.0% of Closing Date EBITDA and (II) 25.0% of TTM Consolidated Adjusted EBITDA as of the
applicable date of determination, and (ii) any Permitted Refinancing incurred pursuant to this clause (s) plus any
Additional Refinancing Amount (if applicable) (it being understood that any Indebtedness Incurred or Disqualified
Stock or Preferred Stock issued pursuant to this clause (s) shall cease to be deemed Incurred, issued or outstanding
pursuant to this clause (s) but shall be deemed Incurred or issued and outstanding as Ratio Debt from and after the first
date on which the Issuer or such Restricted Subsidiary, as the case may be, could have Incurred such Indebtedness or
issued such Disqualified Stock or Preferred Stock as Ratio Debt (to the extent the Issuer or such Restricted Subsidiary
is able to Incur the Liens on such Ratio Debt pursuant to Section 4.12 after such reclassification));
87
(t)
course of business;
(u)
(v)
Indebtedness representing deferred compensation to Company Persons Incurred in the ordinary
Indebtedness consisting of take-or-pay obligations Incurred in the ordinary course of business;
Indebtedness to Management Stockholders to finance the purchase or redemption of Equity
Interests of the Issuer (or any Parent Entity) permitted under Section 4.04;
(w)
obligations in respect of performance, bid, appeal and surety bonds and performance, bankers’
acceptance facilities and completion guarantees and similar obligations provided by the Issuer or any of the Restricted
Subsidiaries or obligations in respect of letters of credit, bank guarantees or similar instruments related thereto, in each
case in the ordinary course of business or consistent with past practice;
(x)
guarantees by the Issuer or any Restricted Subsidiary in respect of Indebtedness, Disqualified Stock
or Preferred Stock of the Issuer or any Restricted Subsidiary otherwise permitted by this Indenture; provided that (A) if
the Indebtedness, Disqualified Stock or Preferred Stock being guaranteed is subordinated in right of payment to the
Notes (except in respect of intercompany current liabilities Incurred in the ordinary course of business in connection
with the cash management, tax and accounting operations of the Issuer and its Subsidiaries), such Indebtedness,
Disqualified Stock or Preferred Stock is subordinated in right of payment to the Notes or the Guarantee of such
Subsidiary Guarantor and (B) any guarantee by the Issuer or any Subsidiary Guarantor of Indebtedness, Disqualified
Stock or Preferred Stock of a Restricted Subsidiary that is not a Subsidiary Guarantor is not prohibited by Section 4.04;
(y)
(i) Indebtedness or Disqualified Stock of the Issuer and Indebtedness, Disqualified Stock or
Preferred Stock of any Restricted Subsidiary; provided that the aggregate principal amount or liquidation preference of
such Indebtedness Incurred or Disqualified Stock or Preferred Stock issued and then outstanding pursuant to this clause
(y)(i), after giving Pro Forma Effect thereto, shall not exceed the greater of (I) 50.0% of Closing Date EBITDA and (II)
50.0% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination; and (ii) any Permitted
Refinancing incurred pursuant to this clause (y) plus any Additional Refinancing Amount (if applicable) (it being
understood that any Indebtedness Incurred or Disqualified Stock or Preferred Stock issued pursuant to this clause (y)
shall cease to be deemed Incurred, issued or outstanding pursuant to this clause (y) but shall be deemed Incurred or
issued and outstanding as Ratio Debt from and after the first date on which the Issuer or such Restricted Subsidiary, as
the case may be, could have Incurred such Indebtedness or issued such Disqualified Stock or Preferred Stock as Ratio
Debt (to the extent the Issuer or such Restricted Subsidiary is able to Incur the Liens on such Ratio Debt pursuant to
Section 4.12 after such reclassification));
(z)
(i) Indebtedness or Disqualified Stock of the Issuer and Indebtedness, Disqualified Stock or
Preferred Stock of any Restricted Subsidiary Incurred to finance or assumed in connection with an acquisition of any
assets (including Capital Stock), business
88
or Person; provided that the aggregate principal amount or liquidation preference of such Indebtedness Incurred or
Disqualified Stock or Preferred Stock issued and then outstanding pursuant to this clause (z)(i) shall not exceed the
greater of (I) 25% of Closing Date EBITDA and (II) 25% of TTM Consolidated Adjusted EBITDA as of the applicable
date of determination; and (ii) any Permitted Refinancing incurred pursuant to this clause (z) plus any Additional
Refinancing Amount (if applicable) (it being understood that any Indebtedness Incurred or Disqualified Stock or
Preferred Stock issued pursuant to this clause (z) shall cease to be deemed Incurred, issued or outstanding pursuant to
this clause (z) but shall be deemed Incurred or issued and outstanding as Ratio Debt from and after the first date on
which the Issuer or such Restricted Subsidiary, as the case may be, could have Incurred such Indebtedness or issued
such Disqualified Stock or Preferred Stock as Ratio Debt (to the extent the Issuer or such Restricted Subsidiary is able
to Incur the Liens on such Ratio Debt pursuant to Section 4.12 after such reclassification));
(aa)
(i) the Incurrence by the Issuer and the Subsidiary Guarantors of the Notes that are issued on the
Issue Date and the Guarantees (but not including any Additional Notes) and (ii) any Permitted Refinancing incurred
pursuant to this clause (aa) plus any Additional Refinancing Amount (if applicable);
(bb)
Indebtedness Incurred or Disqualified Stock issued by the Issuer or any Restricted Subsidiary or
Preferred Stock issued by any of its Restricted Subsidiaries to the extent that the net proceeds thereof are substantially
contemporaneously and irrevocably deposited with the Trustee (in an amount sufficient to pay and discharge the entire
Indebtedness on the Notes) to satisfy and discharge the Notes in accordance with Section 8.01;
(cc)
(i) Indebtedness in respect of letters of credit for the account of the Issuer or any Restricted
Subsidiary so long as (A) such Indebtedness is not secured by a Lien on Collateral other than Liens permitted under
Section 4.12 or the definition of “Permitted Liens” and (B) the aggregate face amount of such letters of credit does not
exceed the greater of (I) 10.0% of Closing Date EBITDA and (II) 10.0% of TTM Consolidated Adjusted EBITDA, in
each case determined at the time of issuance of such letter of credit and (ii) Indebtedness in respect of letters of credit
that are fully cash collateralized; and
(dd)
all premiums (if any), interest (including post-petition interest), fees, expenses, charges and
additional or contingent interest on obligations described in clauses (a) through (cc) of this Section 4.03(2).
(3)
For purposes of determining compliance with this Section 4.03, see Section 1.05 herein.
In the event that an item of Indebtedness, Disqualified Stock or Preferred Stock (or any portion thereof) meets the
criteria of more than one of the categories of Permitted Debt described in clauses (a) through (dd) of Section 4.03(2) (or any
portion thereof), or is entitled to be Incurred or issued as Ratio Debt, then the Issuer may, in its sole discretion, divide, classify or
reclassify, or later divide, classify or reclassify (as if Incurred at such later time), such item of Indebtedness, Disqualified Stock or
Preferred Stock (or any portion thereof) in any manner that complies with
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this Section 4.03; provided that (x) all Indebtedness created pursuant to the Term Loan Credit Agreement on the Merger Date
shall be Incurred under clause (a) of Section 4.03(2) and may not be reclassified, (y) all Indebtedness created pursuant to the
ABL Credit Agreement on the Merger Date shall be Incurred under clause (b) of Section 4.03(2) and may not be reclassified and
(z) the Notes and the Guarantees outstanding on the Merger Date shall be Incurred under clause (aa) of Section 4.03(2) and may
not be reclassified.
Accrual of interest, the accretion of accreted value, the payment of interest or dividends in the form of additional
Indebtedness, Disqualified Stock or Preferred Stock, as applicable, amortization of original issue discount or deferred financing
costs, the accretion of original issue discount or deferred financing costs or liquidation preference and increases in the amount of
Indebtedness, Disqualified Stock or Preferred Stock outstanding solely as a result of fluctuations in the exchange rate of
currencies or increases in the value of property securing Indebtedness described in clause (c) of the definition of “Indebtedness”
will not be deemed to be an Incurrence of Indebtedness, Disqualified Stock or Preferred Stock for purposes of this Section 4.03.
Guarantees of, or obligations in respect of letters of credit relating to, Indebtedness which is otherwise included in the
determination of a particular amount of Indebtedness shall not be included in the determination of such amount of Indebtedness;
provided that the Incurrence of the Indebtedness represented by such guarantee or letter of credit, as the case may be, was in
compliance with this Section 4.03. The principal amount of any non-interest bearing Indebtedness or other discount security
constituting Indebtedness at any date shall be the principal amount thereof that would be shown on a balance sheet of the Issuer
dated such dated prepared in accordance with GAAP.
For purposes of determining compliance with any U.S. dollar-denominated restriction (or restriction based on a
percentage of TTM Consolidated Adjusted EBITDA, if greater) on the Incurrence of Indebtedness, Disqualified Stock or
Preferred Stock, the U.S. dollar-equivalent principal amount of Indebtedness, Disqualified Stock or Preferred Stock denominated
in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness,
Disqualified Stock or Preferred Stock was Incurred, in the case of term debt, or first committed or first Incurred (whichever
yields the lower U.S. dollar equivalent), in the case of revolving credit debt. However, if the Indebtedness, Disqualified Stock or
Preferred Stock is Incurred to refinance other Indebtedness, Disqualified Stock or Preferred Stock denominated in a foreign
currency, and the refinancing would cause the applicable U.S. dollar-denominated restriction (or restriction based on a percentage
of TTM Consolidated Adjusted EBITDA, if greater) to be exceeded if calculated at the relevant currency exchange rate in effect
on the date of such refinancing, the U.S. dollar-denominated restriction (or restriction based on a percentage of TTM
Consolidated Adjusted EBITDA, if greater) will be deemed not to have been exceeded so long as the principal amount of such
refinancing Indebtedness, Disqualified Stock or Preferred Stock does not exceed the principal amount of the Indebtedness,
Disqualified Stock or Preferred Stock being refinanced plus any Additional Refinancing Amount (if applicable).
Notwithstanding any other provision of this Section 4.03, the maximum amount of Indebtedness that the Issuer and the
Restricted Subsidiaries may Incur pursuant to this Section 4.03 shall not be deemed to be exceeded, with respect to any
outstanding Indebtedness, solely as a result of fluctuations in the exchange rate of currencies. The principal amount of any
Indebtedness Incurred to refinance other Indebtedness, if Incurred in a different currency from the Indebtedness
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being refinanced, will be calculated based on the currency exchange rate applicable to the currencies in which the respective
Indebtedness is denominated that is in effect on the date of the refinancing.
SECTION 4.04
Limitation on Restricted Payments
.
(1)
The Issuer shall not, and shall not permit any of the Restricted Subsidiaries to, directly or indirectly:
(a)
declare or pay any dividend or make any distribution on account of any of the Issuer’s or any of the
Restricted Subsidiaries’ Equity Interests (in each case, solely to a holder of Equity Interests in such Person’s capacity as
a holder of such Equity Interests), including any payment made in connection with any merger, amalgamation or
consolidation involving the Issuer (other than (A) dividends or distributions payable solely in Equity Interests (other
than Disqualified Stock) of the Issuer or (B) dividends or distributions by a Restricted Subsidiary so long as, in the case
of any dividend or distribution payable on or in respect of any class or series of Equity Interests issued by a Restricted
Subsidiary that is not a Wholly Owned Restricted Subsidiary, the Issuer or a Restricted Subsidiary receive at least its
pro rata share of such dividend or distribution in accordance with its Equity Interests in such class or series of Equity
Interests);
(b)
purchase or otherwise acquire or retire for value any Equity Interests of the Issuer or any Parent
Entity including in connection with any merger, amalgamation or consolidation;
(c)
make any principal payment on, or redeem, repurchase, defease or otherwise acquire or retire for
value, in each case prior to any scheduled repayment or scheduled maturity, any Subordinated Indebtedness or Junior
Lien Indebtedness of the Issuer or any Subsidiary Guarantor (other than the payment, redemption, repurchase,
defeasance, acquisition or retirement of (A) Subordinated Indebtedness in anticipation of satisfying a sinking fund
obligation, principal installment or final maturity, in each case due within one year of the date of such payment,
redemption, repurchase, defeasance, acquisition or retirement, (B) Indebtedness permitted under Section 4.03(2)(d) or
(C) Indebtedness of the Issuer or a Restricted Subsidiary owed to Holdings; or
(d)
make any Restricted Investment
(all such payments and other actions set forth in clauses (a) through (d) of this Section 4.04(1) being collectively referred to as
“Restricted Payments”), unless, at the time of such Restricted Payment:
(i)
(x) in the case of a Restricted Investment, no Specified Event of Default shall have
occurred and be continuing or would occur as a consequence thereof and (y) in the case of all other Restricted
Payments, no Event of Default shall have occurred and be continuing or would occur as a consequence
thereof;
(ii)
immediately after giving effect to such transaction on a Pro Forma Basis, the Issuer could
Incur $1.00 of additional Indebtedness of Ratio Debt; and
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(iii)
such Restricted Payment, together with the aggregate amount of all other Restricted
Payments made by the Issuer and the Restricted Subsidiaries after the Issue Date (including Restricted
Payments permitted by Section 4.04(2)(m) below, but excluding all other Restricted Payments permitted by
Section 4.04(2)), is less than the amount equal to the Cumulative Credit outstanding at such time.
For the avoidance of doubt, the payment of any Contractual Obligation that is based on, or measured with respect to the
value of an Equity Interest, including any such Contractual Obligations constituting compensation arrangements, shall not be
considered a Restricted Payment.
(2)
Section 4.04(1) shall not prohibit the following:
(a)
each Restricted Subsidiary may make Restricted Payments to the Issuer and to any other Restricted
Subsidiaries (and, in the case of a Restricted Payment by a non-Wholly Owned Restricted Subsidiary, to the Issuer or
any such other Restricted Subsidiaries and to each other owner of Equity Interests of such Restricted Subsidiary
according to the applicable terms of the relevant class of Equity Interests);
(b)
the Issuer and each of the Restricted Subsidiaries may declare and make dividend payments or other
distributions payable solely in the form of Equity Interests (other than Disqualified Stock that are prohibited by Section
4.03) of such Person;
(c)
Restricted Payments made in connection with the Transactions;
(d)
to the extent constituting Restricted Payments, the Issuer and the Restricted Subsidiaries may enter
into and consummate transactions expressly permitted by any provision of the definition of “Permitted Investments”
(other than clause (e) thereof), Section 5.01 and Section 4.07 (other than Section 4.07(B)(1) or (B)(10));
(e)
Restricted Payments in respect of the repurchase of Equity Interests in Holdings or any Parent
Entity (or any Parent Entity of Holdings that only owns Equity Interests, directly or indirectly, in the Issuer and its
Subsidiaries), the Issuer or any Restricted Subsidiary that occur upon or in connection with the exercise of stock
options or warrants or similar rights if such Restricted Payments represent a portion of the exercise price of such
options or warrants or similar rights or tax withholding obligations with respect thereto;
(f)
the Issuer may pay (or make Restricted Payments to allow Holdings or any other Parent Entity to
pay) for the repurchase, retirement or other acquisition or retirement for value of Equity Interests of the Issuer (or of
any Parent Entity) held by any Management Stockholder, including pursuant to any employee or director equity plan,
employee or director stock option or profits interest plan or any other employee or director benefit plan or any
agreement (including any separation, stock subscription, shareholder or partnership agreement) with any employee,
director, officer, manager, consultant, independent contractor or distributor of the Issuer (or any Parent Entity) or any of
its Subsidiaries;
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provided, that the aggregate Restricted Payments made pursuant to this clause (f) after the Issue Date shall not exceed:
(i)
the greater of (A) 5.0% of Closing Date EBITDA and (B) 5.0% of TTM Consolidated
Adjusted EBITDA as of the applicable date of determination in any calendar year, with unused amounts in
any calendar year being carried over to the next two succeeding calendar years; plus
(ii)
an amount not to exceed the cash proceeds of key man life insurance policies received by
the Issuer or the Restricted Subsidiaries after the Issue Date; plus
(iii)
to the extent contributed in cash to the common Equity Interests of the Issuer and Not
Otherwise Applied, the proceeds from the sale of Equity Interests of Holdings or any other Parent Entity, in
each case to a Person that is or becomes a Management Stockholder that occurs after the Issue Date; plus
(iv)
the amount of any cash bonuses or other compensation otherwise payable to any
Company Person that are foregone in return for the receipt of Equity Interests of Holdings or a Parent Entity,
the Issuer or any Restricted Subsidiary; plus
(v)
payments made in respect of withholding or other similar taxes payable upon repurchase,
retirement or other acquisition or retirement of Equity Interests of the Issuer or its Subsidiaries or any Parent
Entity or otherwise pursuant to any employee or director equity plan, employee or director stock option or
profits interest plan or any other employee or director benefit plan or any agreement;
provided that the Issuer may elect to apply all or any portion of the aggregate increase contemplated by
clauses (i) and (ii) above in any calendar year; and provided, further, that cancellation of Indebtedness owing
to the Issuer or any Restricted Subsidiary from any Management Stockholder in connection with a repurchase
of Equity Interests of the Issuer or any Parent Entity will not be deemed to constitute a Restricted Payment
for purposes of this Section 4.04 or any other provision of this Indenture;
(g)
the Issuer may make Restricted Payments to Holdings or to any other Parent Entity:
(i)
the proceeds of which will be used to pay (or make Restricted Payments to allow any direct
or indirect corporate parent (or entity treated as a corporation for Tax purposes) thereof to pay) the Tax
liability (including estimated Tax payments) to each foreign, federal, state, provincial, territorial or local
jurisdiction in respect of which a Tax return is filed by Holdings (or such direct or indirect parent) that
includes the Issuer and/or any of its Subsidiaries (including in the case where the Issuer and any Subsidiary is
a disregarded entity for income Tax purposes), to the extent such Tax liability does not exceed the lesser of
(A) the Taxes (including estimated Tax payments) that would have been payable by the
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Issuer and/or its Subsidiaries as a stand-alone Tax group (assuming that the Issuer was classified as a
corporation for income Tax purposes) and (B) the actual Tax liability (including estimated Tax payments) of
Holdings’ Tax group (or, if Holdings is not the parent of the actual group, the Taxes that would have been
paid by Holdings (assuming that Holdings was classified as a corporation for income Tax purposes), the
Issuer and/or the Issuer’s Subsidiaries as a stand-alone Tax group), reduced in the case of clauses (A) and (B)
by any such Taxes paid or to be paid directly by the Issuer or its Subsidiaries; provided that in the case of any
such distributions attributable to Tax liability in respect of income of an Unrestricted Subsidiary, the Issuer
shall use all commercially reasonable efforts to cause such Unrestricted Subsidiary (or another Unrestricted
Subsidiary) to make cash distributions to the Issuer or its Restricted Subsidiaries in an aggregate amount that
the Issuer determines in its reasonable discretion is necessary to pay such Tax liability on behalf of such
Unrestricted Subsidiary;
(ii)
the proceeds of which will be used to pay (or make Restricted Payments to allow any
Parent Entity to pay) operating costs and expenses (including Public Company Costs) of Holdings or any
other Parent Entity Incurred in the ordinary course of business and other corporate overhead costs and
expenses (including administrative, legal, accounting and similar expenses provided by third parties), which
are reasonable and customary and Incurred in the ordinary course of business, attributable to the ownership or
operations of the Issuer and its Subsidiaries;
(iii)
the proceeds of which will be used to pay franchise taxes and other fees, taxes and
expenses required to maintain its (or any of such Parent Entity’s) corporate or legal existence;
(iv)
to finance any Investment permitted to be made under this Indenture; provided that (A)
such Restricted Payment shall be made substantially concurrently with the closing of such Investment and
(B) Holdings and the Issuer shall, immediately following the closing thereof, cause (1) all property acquired
(whether assets or Equity Interests) to be contributed to the Issuer or a Restricted Subsidiary or (2) the merger
or amalgamation (to the extent permitted in Section 5.01) of the Person formed or acquired by the Issuer or a
Restricted Subsidiary in order to consummate such Investment;
(v)
the proceeds of which shall be used to pay (or make Restricted Payments to allow any
Parent Entity to pay) costs, fees and expenses (other than to Affiliates) related to any successful or
unsuccessful equity or debt offering permitted by this Indenture;
(vi)
the proceeds of which (A) will be used to pay customary salary, bonus and other benefits
payable to directors, officers, employees, managers, consultants, independent contractors and distributors of
Holdings or any other Parent Entity to the extent such salaries, bonuses and other benefits are attributable to
the ownership or operation of the Issuer and the Restricted Subsidiaries or (B)
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will be used to make payments permitted under Sections 4.07(B)(5), (8), (11) and (17) (but only to the extent
such payments have not been and are not expected to be made by the Issuer or a Restricted Subsidiary); and
(vii)
in amounts required for any Parent Entity, if applicable, to pay interest and/or principal
on Indebtedness the proceeds of which have been contributed to the Issuer or any Restricted Subsidiary and
that has been guaranteed by, or is otherwise considered Indebtedness of, the Issuer Incurred in accordance
with Section 4.03;
(h)
Restricted Payments (i) made in connection with the payment of cash in lieu of fractional Equity
Interests in connection with any dividend, split or combination thereof or any acquisition, Investment or other
transaction permitted by this Indenture or (ii) to honor any conversion request by a holder of convertible Indebtedness
and to make cash payments in lieu of the issuance of fractional shares in connection with any such conversion and
payments on convertible Indebtedness in accordance with its terms;
(i)
following a Qualifying IPO, the declaration and payment of dividends on the Issuer’s, Holdings’ or
a Parent Entity’s common stock or purchase of or other retirement of Equity Interests of the Issuer, Holdings or a Parent
Entity per annum, not to exceed 6.0% of the net proceeds received by or contributed to the Issuer in or from a
Qualifying IPO (or in the case of a SPAC IPO, cash held by the Issuer (or held by Holdings or any other Parent Entity
to the extent contributed to the Issuer or, if greater, the amount of proceeds from the previous initial public offering of
the SPAC IPO Entity) following the consummation of such SPAC IPO);
(j)
repurchases of Equity Interests (i) deemed to occur on the exercise of options by the delivery of
Equity Interests in satisfaction of the exercise price of such options or (ii) in consideration of withholding or similar
taxes payable by any Management Stockholder, including deemed repurchases in connection with the exercise of stock
options or the vesting of any equity awards;
(k)
Restricted Payments to Holdings or to any other Parent Entity of Investments and Equity Interests
in, Indebtedness owing from, and/or other securities of, an Unrestricted Subsidiary (other than Unrestricted
Subsidiaries, the primary assets of which are cash and/or Cash Equivalents);
(l)
payments or distributions to satisfy dissenters rights (including in connection with or as a result of
the exercise of appraisal rights and the settlement of any claims or actions, whether actual, contingent or potential)
pursuant to or in connection with a merger, amalgamation, consolidation, transfer of assets or other transaction
permitted by Section 5.01;
(m)
payments or distributions of a Restricted Payment or the consummation of any redemption within
60 days after the date of declaration thereof or the giving of notice thereof as applicable, if at the date of declaration or
the giving of notice thereof as applicable, such Restricted Payment would have been permitted under this Indenture;
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(n)
on and after the date that is 24 months after the Merger Date, Restricted Payments in an aggregate
amount not to exceed the greater of (a) 25.0% of Closing Date EBITDA and (b) 25.0% of TTM Consolidated Adjusted
EBITDA as of the applicable date of determination;
(o)
Restricted Payments; provided that (i) in the case of Restricted Payments described under clauses
(a) and (b) of the definition thereof, (x) the Total Net Leverage Ratio (after giving Pro Forma Effect to such Restricted
Payment and on a Pro Forma Basis) for the Test Period immediately preceding the making of such Restricted Payment
would be less than or equal to the Closing Date Total Net Leverage Ratio less 2.00 to 1.00, (y) no Event of Default
shall have occurred and be continuing or would result therefrom, and (z) in no event shall any Restricted Payments
described under clauses (1) and (2) of the definition thereof in reliance on this clause (i) prior to the date that is 24
months after the Merger Date; (ii) in the case of Restricted Payments described under clause (c) of the definition
thereof, the (x) Total Net Leverage Ratio (after giving Pro Forma Effect to such Restricted Payment and on a Pro
Forma Basis) would be less than or equal to the Closing Date Total Net Leverage Ratio less 1.75 to 1.00 and (y) no
Event of Default shall have occurred and be continuing or would result therefrom; and (iii) in the case of any Restricted
Investment, the (x) Total Net Leverage Ratio (after giving Pro Forma Effect to such Restricted Payment and on a Pro
Forma Basis) would be less than or equal to the Closing Date Total Net Leverage Ratio less 1.50 to 1.00 and (y) no
Specified Event of Default shall have occurred and be continuing or would result therefrom;
(i)
(p)
the redemption, repurchase, retirement or other acquisition of any Equity Interests
(“Retired Capital Stock”), including any accrued and unpaid dividends thereon, or Subordinated Indebtedness
of the Issuer, any Parent Entity or any Subsidiary Guarantor in exchange for, or out of the proceeds of, the
substantially concurrent sale of, Equity Interests of the Issuer or any Parent Entity or contributions to the
equity capital of the Issuer (other than any Disqualified Stock or any Equity Interests sold to a Subsidiary of
the Issuer) (collectively, including any such contributions, “Refunding Capital Stock”),
the declaration and payment of dividends on the Retired Capital Stock out of the proceeds
of the substantially concurrent sale (other than to a Subsidiary of the Issuer) of Refunding Capital Stock, and
(ii)
(iii)
if immediately prior to the retirement of Retired Capital Stock, the declaration and
payment of dividends thereon was permitted under clause (m) of this Section 4.04(2) and not made pursuant
to subclause (ii) of this clause (p), the declaration and payment of dividends on the Refunding Capital Stock
(other than Refunding Capital Stock the proceeds of which were used to redeem, repurchase, retire or
otherwise acquire any Equity Interests of any Parent Entity) in an aggregate amount per year no greater than
the aggregate amount of dividends per annum that were declarable and payable on such Retired Capital Stock
immediately prior to such retirement;
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(q)
the redemption, repurchase, defeasance, or other acquisition or retirement of Disqualified Stock of
the Issuer or a Subsidiary Guarantor made by exchange for, or out of the proceeds of the substantially concurrent sale
of, Disqualified Stock of the Issuer or a Subsidiary Guarantor which, in each case, is Incurred or issued, as applicable,
in accordance with Section 4.03 so long as:
(i)
the principal amount (or accreted value, if applicable) of such new Indebtedness or the
liquidation preference of such new Disqualified Stock does not exceed the principal amount of (or accreted
value, if applicable), plus any accrued and unpaid interest on, the liquidation preference of, plus any accrued
and unpaid dividends on, the Disqualified Stock being so redeemed, repurchased, defeased, acquired or
retired for value (plus the amount of any premium required to be paid under the terms of the instrument
governing the Disqualified Stock being so redeemed, repurchased, acquired or retired, any tender premiums,
plus any defeasance costs, fees and expenses incurred in connection therewith),
(ii)
Subsidiary Guarantor,
such new Indebtedness is subordinated to the Notes or the related Guarantee of such
(iii)
such new Indebtedness or Disqualified Stock has a final scheduled maturity date equal to
or later than the earlier of (x) the final scheduled maturity date of the Disqualified Stock being so redeemed,
repurchased, acquired or retired and (y) 91 days following the last maturity date of any Notes then
outstanding, and
(iv)
such new Indebtedness or Disqualified Stock has a Weighted Average Life to Maturity at
the time Incurred which is not less than the shorter of (x) the remaining Weighted Average Life to Maturity of
the Disqualified Stock being so redeemed, repurchased, defeased, acquired or retired and (y) the Weighted
Average Life to Maturity that would result if all payments of principal on the Disqualified Stock being
redeemed, repurchased, defeased, acquired or retired that were due on or after the date that is one year
following the last maturity date of any Notes then outstanding were instead due on such date;
(r)
the declaration and payment of dividends or distributions to holders of any class or series of
Disqualified Stock of the Issuer or any Restricted Subsidiary issued or Incurred in accordance with Section 4.03;
(s)
(i) the declaration and payment of dividends or distributions to holders of any class or series of
Designated Preferred Stock (other than Disqualified Stock) issued after the Issue Date; (ii) a Restricted Payment to any
Parent Entity, the proceeds of which will be used to fund the payment of dividends to holders of any class or series of
Designated Preferred Stock (other than Disqualified Stock) of any Parent Entity issued after the Issue Date; provided
that the aggregate amount of dividends declared and paid pursuant to this clause (ii) does not exceed the net cash
proceeds actually received by the Issuer from any such sale of Designated Preferred Stock (other than Disqualified
Stock) issued after the Issue Date; and (iii) the declaration and payment of dividends on Refunding Capital Stock that is
Preferred Stock in excess of the dividends declarable and payable thereon pursuant
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to Section 4.04(2)(p); provided, however, in the case of each of clause (i) and clause (iii) above of this clause (s), that
for the most recently ended four full fiscal quarters for which internal financial statements are available, after giving
effect to such issuance (and the payment of dividends or distributions and treating such Designated Preferred Stock as
Indebtedness for borrowed money for such purpose) or declaration on a Pro Forma Basis (including a pro forma
application of the net proceeds therefrom), the Issuer could Incur $1.00 of additional Indebtedness as Ratio Debt;
(t)
Restricted Payments that are made with (or in an aggregate amount that does not exceed the
aggregate amount of) Excluded Contributions;
(u)
any consideration, payment, dividend, distribution or other transfer in connection with a Qualified
Securitization Financing;
(v)
payments or distributions to dissenting stockholders or stockholders exercising appraisal rights
pursuant to applicable Law or as a result of the settlement of any claims or action (whether actual, contingent or
potential), pursuant to or in connection with (x) the Transactions or (y) a consolidation, amalgamation, merger or
transfer of all or substantially all of the assets of the Issuer and the Restricted Subsidiaries, taken as a whole, that
complies with Section 5.01; provided that as a result of such consolidation, amalgamation, merger or transfer of assets
referred to in clause (y), the Issuer shall have made a Change of Control Offer or Alternate Offer (if required by this
Indenture) and that all Notes tendered by holders in connection with such Change of Control Offer or Alternate Offer
have been repurchased, redeemed or acquired for value;
(w)
payments made or expected to be made by the Issuer or any Restricted Subsidiary in respect of
withholding or similar taxes payable upon exercise of Equity Interests by any Management Stockholder of the Issuer or
any Restricted Subsidiary or any Parent Entity;
(x)
the repurchase, redemption or other acquisition or retirement for value of any Preferred Stock, any
Disqualified Stock or any Subordinated Indebtedness pursuant to provisions similar to those described in Sections 4.06
and 4.08; provided that all Notes tendered by holders of the Notes in connection with a Change of Control Offer,
Alternate Offer or Asset Sale Offer, as applicable, have been repurchased, redeemed or acquired for value;
(y)
the Issuer may (or may make Restricted Payments to permit any Parent Entity to) (i) redeem,
repurchase, retire or otherwise acquire in whole or in part any Equity Interests of the Issuer or any Restricted
Subsidiary or any Equity Interests of any Parent Entity (“Treasury Equity Interests”), in exchange for, or with the
proceeds (to the extent contributed to Holdings or the Issuer substantially concurrently) of the sale or issuance (other
than to the Issuer or any Restricted Subsidiary) of, other Equity Interests or rights to acquire its Equity Interests and (y)
declare and pay dividends on any Treasury Equity Interests out of any such proceeds;
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(z)
redemptions in whole or in part of any of its Equity Interests for another class of its Equity Interests
(other than Disqualified Stock, except to the extent issued by the Issuer to a Restricted Subsidiary) or with proceeds
from substantially concurrent equity contributions or issuances of new Equity Interests (and in no event shall such
contribution or issuance so utilized increase the Cumulative Credit) (other than Disqualified Stock, except to the extent
issued by the Issuer to a Restricted Subsidiary);
(aa)
(bb)
[reserved];
[reserved];
(cc)
Restricted Payments constituting or otherwise made in connection with or relating to any Permitted
Reorganization; provided that if immediately after giving Pro Forma Effect to any such Permitted Reorganization and
the transactions to be consummated in connection therewith, any distributed asset ceases to be owned by the Issuer or
another Restricted Subsidiary (or any entity ceases to be a Restricted Subsidiary), the applicable portion of such
Restricted Payment must be otherwise permitted under another provision of this Section 4.04 or as a Permitted
Investment (and constitute utilization of such other Restricted Payment or Permitted Investment exception or capacity);
(dd)
the redemption, repurchase, defeasance, or other acquisition or retirement of Indebtedness of any
Person that becomes a Restricted Subsidiary after the Merger Date in connection with a transaction not prohibited by
this Indenture;
(ee)
the redemption, repurchase, defeasance, or other acquisition or retirement of Indebtedness
consisting of the payment of regularly scheduled interest and principal payments, payments of fees, expenses, penalty
interest and indemnification obligations when due, and mandatory prepayment, mandatory redemptions and mandatory
purchases and offers to repurchase pursuant to the terms of such Indebtedness, other than payments prohibited by any
applicable subordination provisions; and
(ff)
Restricted Payments consisting of a payment to avoid the application of Section 163(e)(5) of the
Code.
For the avoidance of doubt, the redemption or repurchase of any or all of the Existing Notes pursuant to the Existing
Notes Change of Control Offers or otherwise shall not constitute a Restricted Payment.
The amount of any Restricted Payment at any time shall be the amount of cash and the Fair Market Value of other
property subject to the Restricted Payment at the date of determination or the time such Restricted Payment is made. For
purposes of determining compliance with this Section 4.04, (A) a Restricted Payment or Permitted Investment need not be
permitted solely by reference to one category of permitted Restricted Payments (or any portion thereof) or Permitted Investments
(or any portion thereof) described in the above clauses of this Section 4.04 or the definitions thereof but may be permitted in part
under any combination thereof and (B) in the event that a Restricted Payment (or any portion thereof) or Permitted Investment (or
any portion thereof) meets the criteria of one or more of the categories of permitted Restricted Payments (or any portion
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thereof) or Permitted Investments (or any portion thereof) described in the above clauses of this Section 4.04 or the definitions
thereof, the Issuer may, in its sole discretion, divide, classify or reclassify, or later divide, classify or reclassify, such permitted
Restricted Payment (or any portion thereof) or Permitted Investment (or any portion thereof) in any manner that complies with
this Section 4.04 and at the time of division, classification or reclassification will be entitled to only include the amount and type
of such Restricted Payment (or any portion thereof) or Permitted Investment (or any portion thereof) in one of the categories of
permitted Restricted Payments (or any portion thereof) or Permitted Investments (or any portion thereof) described in the above
clauses of this Section 4.04 or the definition of “Permitted Investment”.
The amount set forth in Section 4.04(2)(n)(A) may, in lieu of Restricted Payments described in Section 4.04(1)(a) and
Section 4.04(1)(b), be utilized by the Issuer or any Restricted Subsidiary to make any other Restricted Payment described in
Section 4.04(1)(c) or Section 4.04(1)(d) and the amount set forth in Section 4.04(2)(n)(B) may, in lieu of Restricted Payments
described in Section 4.04(1)(c), be utilized by the Issuer or any Restricted Subsidiary to make Restricted Investments.
As of the Merger Date, all of the Subsidiaries of the Issuer will be Restricted Subsidiaries. The Issuer will not permit
any Restricted Subsidiary to become an Unrestricted Subsidiary except pursuant to the definition of “Unrestricted Subsidiary”.
For purposes of designating any Restricted Subsidiary as an Unrestricted Subsidiary, all outstanding Investments by the Issuer
and the Restricted Subsidiaries (except to the extent repaid) in the Subsidiary so designated on such date of designation will be
deemed to be Restricted Payments in an amount determined as set forth in the last sentence of the definition of “Investments”.
Such designation will only be permitted if a Restricted Payment or Permitted Investment in such amount would be permitted at
such time and if such Subsidiary otherwise meets the definition of an “Unrestricted Subsidiary”. Notwithstanding the foregoing,
none of Holdings, the Issuer or any of its Restricted Subsidiaries will be permitted to transfer (whether by sale, contribution,
dividend or otherwise), material intellectual property to any Unrestricted Subsidiary.
SECTION 4.05
Dividend and Other Payment Restrictions Affecting Subsidiaries
. The Issuer will not, and will not permit any of the Restricted Subsidiaries that is not a Subsidiary Guarantor to,
directly or indirectly, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or consensual
restriction on the ability of the Issuer or any Restricted Subsidiary (other than an Excluded Subsidiary) that is not a Subsidiary
Guarantor to:
(a)
(i) make or pay dividends or make any other distributions to the Issuer or any Restricted Subsidiary (1) on
their Capital Stock or (2) with respect to any other interest or participation in, or measured by, their profits; or (ii) make or pay
any Indebtedness owed to the Issuer or any Restricted Subsidiary;
(b)
(c)
make loans or advances to the Issuer or any Restricted Subsidiary; or
sell, lease or transfer any of their properties or assets to the Issuer or any Restricted Subsidiary;
except in each case for such encumbrances or restrictions that:
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(1)
(A) exist on the Merger Date, (B) to the extent Contractual Obligations permitted by clause (A) are
set forth in an agreement evidencing Indebtedness, are set forth in any agreement evidencing any permitted
modification, replacement, renewal, extension or refinancing of such Indebtedness, (C) are pursuant to the Credit
Agreements and the Credit Agreement Documents and any related Hedge Agreement, (D) exist under this Indenture,
the Notes, the Guarantees, the Security Documents and the Intercreditor Agreements and any Permitted Refinancing
thereof and (E) in each case, any similar contractual encumbrances or restrictions or any amendments, modifications,
restatements, renewals, supplements, refundings, replacements or refinancings of such agreements or instruments;
(2)
are binding on a Restricted Subsidiary at the time such Restricted Subsidiary first becomes a
Restricted Subsidiary, so long as such Contractual Obligations were not entered into in contemplation of such Person
becoming a Restricted Subsidiary or binding with respect to any asset at the time such asset was acquired;
(3)
are Contractual Obligations of or represent Indebtedness of a Restricted Subsidiary that is not a
Subsidiary Guarantor; provided that such Indebtedness is permitted by Section 4.03 hereof;
(4)
are customary restrictions that arise in connection with (A) any Lien permitted by Section 4.12
hereof, and relate to the property subject to such Lien or (B) any Asset Sale permitted by Section 4.06 hereof applicable
pending such Asset Sale solely to the assets (including Equity Interests) subject to such Asset Sale;
(5)
are provisions in Joint Venture agreements and other similar agreements applicable to Joint
Ventures permitted by this Indenture and applicable solely to such Joint Venture;
(6)
are negative pledges and restrictions on Liens in favor of any holder of Indebtedness permitted
under Section 4.03 hereof;
(7)
are restrictions in leases, subleases, licenses, sublicenses or agreements governing a disposition of
assets, trading, netting, operating, construction, service, supply, purchase, sale or other agreements entered into in the
ordinary course of business so long as such restrictions relate to the assets subject thereto;
(8)
comprise restrictions imposed by any agreement relating to secured Indebtedness permitted
pursuant to clause (e), (g), (o)(i), (r), (s) or (t) of Section 4.03(2) hereof;
(9)
restricts in a customary manner the subletting, assignment or transfer of any property or asset that is
subject to a lease, license or similar contract, or the assignment or transfer of any such lease, license (including without
limitation, licenses of intellectual property) or other contracts;
(10)
are customary provisions restricting assignment of any agreement entered into in the ordinary
course of business;
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(11)
are restrictions on cash or other deposits or net worth imposed by customers, trade counterparties,
suppliers or landlords under contracts entered into in the ordinary course of business or consistent with past practice or
industry norm;
(12)
arise in connection with cash or other deposits permitted under Section 4.12 hereof;
(13)
comprise restrictions that are, taken as a whole, in the good faith judgment of the Issuer, no more
restrictive with respect to the Issuer or any Restricted Subsidiary than customary market terms for Indebtedness of such
type (and, in any event, are no more restrictive than the restrictions contained in this Indenture), or that the Issuer shall
have determined in good faith will not affect its obligation or ability to make any payments required under this
Indenture;
(14)
apply by reason of any applicable Law, rule, regulation or order or are required by any
Governmental Authority having jurisdiction over the Issuer or any Restricted Subsidiary;
(15)
are customary restrictions contained in Indebtedness of the Issuer or any Restricted Subsidiary that
is a Subsidiary Guarantor Incurred after the Merger Date which is permitted to be Incurred pursuant to Section 4.03
hereof so long as such restrictions do not adversely affect the Issuer’s ability to make anticipated principal or interest
payments on the Notes as and when they come due (as determined in good faith by the Issuer);
(16)
are under contracts or agreements for the sale of assets, including any restriction with respect to a
Restricted Subsidiary imposed pursuant to an agreement entered into for the sale or disposition of the Capital Stock or
assets of such Restricted Subsidiary; provided that, such sale is permitted under this Indenture and any such
encumbrance or restriction applies only to the assets so being sold;
(17)
are purchase money obligations for property acquired and Capitalized Lease Obligations in the
ordinary course of business that impose restrictions of the nature discussed in Section 4.05(c) on the property so
acquired;
(18)
any encumbrances or restrictions contained in any documents and agreements evidencing, relating
to or otherwise governing a Qualified Securitization Financing with respect to any Securitization Subsidiary;
(19)
other Indebtedness, Disqualified Stock or Preferred Stock of any Restricted Subsidiary that is not a
Subsidiary Guarantor or a Foreign Subsidiary so long as either (x) such encumbrances and restrictions contained in any
agreement or instrument will not materially adversely affect the Issuer’s ability to make anticipated principal or interest
payments on the Notes as and when they come due (as determined in good faith by the Issuer) or (y) such
encumbrances and restrictions apply only during the continuance of a default in respect of a payment or financial
maintenance covenant relating to such Indebtedness, provided that such Indebtedness, Disqualified Stock or Preferred
Stock is permitted to be Incurred subsequent to the Merger Date by Section 4.03 hereof;
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(20)
any agreement or other instrument of a Person acquired by the Issuer or any Restricted Subsidiary
which was in existence at the time of such acquisition (but not created in contemplation thereof or to provide all or any
portion of the funds or credit support utilized to consummate such acquisition other than in connection with the
Incurrence of Indebtedness of the type contemplated by clause (e) of the definition of “Permitted Debt”), which
encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the
Person and its Subsidiaries, or the property or assets of the Person and its Subsidiaries, so acquired;
(21)
any agreement or other instrument of a Person acquired by the Issuer or any Restricted Subsidiary
which was in existence at the time of such acquisition (but not created in contemplation thereof or to provide all or any
portion of the funds or credit support utilized to consummate such acquisition other than in connection with the
Incurrence of Indebtedness of the type contemplated by Section 4.03(2)(e)), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than the Person and its Subsidiaries, or the
property or assets of the Person and its Subsidiaries, so acquired;
(22)
Contractual Obligations that are subject to the applicable override provisions of the Uniform
Commercial Code;
(23)
customary provisions (including provisions limiting the disposition, distribution or encumbrance
of assets or property) included in sale leaseback agreements, or other similar agreements;
(24)
net worth provisions contained in agreements entered into by the Issuer or any Restricted
Subsidiary, so long as the Issuer has determined in good faith that such net worth provisions would not reasonably be
expected to impair the ability of the Issuer or such Restricted Subsidiary to meet its ongoing obligations;
(25)
restrictions arising in any agreement relating to (i) any obligations with respect to any cash
management services to the extent such restrictions relate solely to the cash, bank accounts or other assets or activities
subject to the applicable cash management services, (ii) any treasury arrangements and (iii) any Hedge Agreements;
(26)
restrictions on the granting of a security interest in intellectual property contained in licenses,
sublicenses or cross-licenses by the Issuer or any Restricted Subsidiary of such intellectual property, which licenses,
sublicenses and cross-licenses were entered into in the ordinary course of business; or
(27)
other restrictions or encumbrances imposed by any amendment, modification, restatement,
renewal, increase, supplement, refunding, replacement or refinancing of the contracts, instruments or obligations
referred to in clauses (1) through (26) above; provided that such amendment, modification, restatement, renewal,
increase, supplement, refunding, replacement or refinancing is, in the good faith determination of the Issuer, not
materially more restrictive with respect to such encumbrances and other restrictions, taken as a whole, than those in
effect prior to the relevant amendment,
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modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing.
For purposes of determining compliance with this Section 4.05, (1) the priority of any Preferred Stock in receiving
dividends or liquidating distributions prior to dividends or liquidating distributions being paid on common stock shall not be
deemed a restriction on the ability to make distributions on Capital Stock and (2) the subordination of loans or advances made to
the Issuer or a Restricted Subsidiary to other Indebtedness Incurred by the Issuer or any such Restricted Subsidiary shall not be
deemed a restriction on the ability to make loans or advances.
SECTION 4.06
Asset Sales
.
A.
The Issuer will not, and will not permit any of the Restricted Subsidiaries to, cause or make an Asset Sale,
unless (x) the Issuer or any Restricted Subsidiary, as the case may be, receive consideration at the time of such Asset Sale at least
equal to the Fair Market Value (as determined in good faith by the Issuer) of the assets sold or otherwise disposed of (or if not for
Fair Market Value, the shortfall is permitted as an Investment by Section 4.04 herein) and (y) with respect to any Asset Sale for a
purchase price in excess of the greater of (I) 10.0% of Closing Date EBITDA and (II) 10.0% of TTM Consolidated Adjusted
EBITDA, at least 75.0% of the consideration for such Asset Sale received by the Issuer or such Restricted Subsidiary, as the case
may be, is in the form of cash or Cash Equivalents; provided that the amount of:
(a)
any liabilities (as shown on the Issuer’s or a Restricted Subsidiary’s most recent balance sheet that
are available or in the footnotes thereto or, if Incurred or increased subsequent to the date of such balance sheet, such
liabilities that would have been shown on the Issuer’s or such Restricted Subsidiary’s balance sheet or in the footnotes
thereto if such Incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the
Issuer) of the Issuer or a Restricted Subsidiary, other than liabilities that are by their terms subordinated in right of
payment to the payment of the Notes and the Guarantee that are assumed by the transferee with respect to the
applicable Asset Sale (or a third party in connection with such transfer) or that are otherwise cancelled or terminated in
connection with the transaction with such transferee;
(b)
any notes or other obligations or other securities or assets received by the Issuer or a Restricted
Subsidiary from such transferee that are converted by the Issuer or a Restricted Subsidiary into cash or Cash
Equivalents (to the extent of the cash or Cash Equivalents received) within 180 days of the receipt thereof;
(c)
Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of
such Asset Sale, to the extent that the Issuer and each other Restricted Subsidiary are released from any guarantee of
payment of such Indebtedness in connection with the Asset Sale;
(d)
Consideration consisting of Indebtedness of the Issuer or a Restricted Subsidiary (other than
Subordinated Indebtedness) received after the Merger Date from Persons who are not the Issuer or any Restricted
Subsidiary; and
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(e)
any Designated Non-Cash Consideration received in respect of such Asset Sale having an aggregate
Fair Market Value (as determined in good faith by the Issuer), taken together with all other Designated Non-Cash
Consideration received pursuant to this clause (e) that is at that time outstanding, not in excess of the greater of (I)
10.0% of Closing Date EBITDA and (II) 10.0% of TTM Consolidated Adjusted EBITDA as of the applicable date of
determination, with the Fair Market Value of each item of Designated Non-Cash Consideration being measured at the
time received and without giving effect to subsequent changes in value,
shall in each case be deemed to be Cash Equivalents for the purposes of this Section 4.06.
B.
Within 360 days after the Issuer’s or any Restricted Subsidiary’s receipt of the Net Proceeds of any Asset
Sale, the Issuer or such Restricted Subsidiary may apply the Net Proceeds from such Asset Sale, at their option:
(1)
to repay (i) Indebtedness constituting Priority Lien Indebtedness that is secured by a Lien permitted
under this Indenture (and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce
commitments with respect thereto), (ii) if the assets or property disposed of in the Asset Sale were not Collateral,
Indebtedness of a Restricted Subsidiary that is not a Subsidiary Guarantor, (iii) Notes Obligations or (iv) other Parity
Lien Indebtedness and, if the assets or property disposed of in the Asset Sale were not Collateral, Pari Passu
Indebtedness (and, if the Indebtedness repaid is revolving credit Indebtedness, to correspondingly reduce commitments
with respect thereto) (provided that if the Issuer or any Subsidiary Guarantor shall so reduce Obligations under such
other Parity Lien Indebtedness or Pari Passu Indebtedness under this clause (iv) (which, for the avoidance of doubt,
does not include Indebtedness described in clauses (i), (ii) and (iii) even if such Indebtedness may also constitute Parity
Lien Indebtedness or Pari Passu Indebtedness), the Issuer will equally and ratably reduce Notes Obligations either, as
the Issuer shall elect in its sole discretion, as provided under Section 3.03 herein, through open-market purchases
(provided that such purchases are at or above 100.0% of the principal amount thereof or, in the event that the Notes
were issued with significant original issue discount, 100.0% of the accreted value thereof) or by making an offer (in
accordance with the procedures set forth below for an Asset Sale Offer) to all holders to purchase a pro rata principal
amount of Notes at a purchase price equal to 100.0% of the principal amount thereof (or, in the event that the Notes
were issued with significant original issue discount, 100.0% of the accreted value thereof), plus accrued and unpaid
interest, if any);
(2)
to make an investment in any one or more businesses, assets, or property or capital expenditures,
including restructuring or similar charges incurred to implement any such investment, in each case (a) used or useful in
a Similar Business or (b) that replace the business, properties and assets that are the subject of such Asset Sale or, in
each case, to reimburse the cost of any of the foregoing incurred on or after the date on which the Asset Sale giving rise
to such Net Proceeds was contractually committed or on or after the date 360 days prior to the consummation of such
Asset Sale; or
(3)
any combination of the foregoing;
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provided that the Issuer and its Restricted Subsidiaries will be deemed to have complied with the provisions described
in clause (2) of this Section 4.06(B) if and to the extent that, within 360 days after the Asset Sale that generated the Net
Proceeds, the Issuer or such Restricted Subsidiary, as applicable, has entered into and not abandoned or rejected a
binding agreement to make an investment in compliance with the provision described in clause (2) of this Section
4.06(B), and that investment is thereafter completed within 180 days after the end of such 360-day period.
Pending the final application of any such Net Proceeds, the Issuer or such Restricted Subsidiary may temporarily
reduce Indebtedness under a revolving credit facility or otherwise use such Net Proceeds in any manner not prohibited by this
Indenture and the Security Documents. If the Issuer has not elected to apply any Net Proceeds from any Asset Sale as provided
and within the time period set forth in the two immediately preceding paragraphs of this Section 4.06, then, in lieu of applying
such Net Proceeds in such manner, such Net Proceeds (it being understood that any portion of such Net Proceeds used to make an
offer to purchase Notes, as described in clause (1) above, shall be deemed to have been so applied whether or not such offer is
accepted) will be deemed to constitute “Excess Proceeds”. If the aggregate amount of Excess Proceeds exceeds the greater of (i)
2.50% of Closing Date EBITDA and (ii) 2.50% of TTM Consolidated Adjusted EBITDA as of the applicable date of
determination, the Issuer shall make an offer to all holders of Notes (and, at the option of the Issuer, to holders of any Parity Lien
Indebtedness, and if the asset or property disposed of in the Asset Sale was not Collateral, Pari Passu Indebtedness) (an “Asset
Sale Offer”) to purchase the maximum principal amount of Notes (and such other Parity Lien Indebtedness and Pari Passu
Indebtedness), that is at least $2,000 and an integral multiple of $1,000 in excess thereof that may be purchased out of the Excess
Proceeds at an offer price in cash in an amount equal to 100% of the principal amount thereof (or, in the event the Notes, such
other Parity Lien Indebtedness or such Pari Passu Indebtedness were issued with significant original issue discount, 100% of the
accreted value thereof), plus accrued and unpaid interest, if any (or, in respect of such other Parity Lien Indebtedness or such Pari
Passu Indebtedness, such lesser price, if any, as may be provided for by the terms of such other Parity Lien Indebtedness or such
Pari Passu Indebtedness), to, but excluding, the date fixed for the closing of such offer, in accordance with the procedures set
forth in this Indenture. The Issuer will commence an Asset Sale Offer with respect to Excess Proceeds within 10 Business Days
after the date that the aggregate amount of Excess Proceeds exceeds the greater of (i) 2.50% of Closing Date EBITDA and (ii)
2.50% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination by mailing, or delivering
electronically if held by the Depository, the notice required pursuant to the terms of this Indenture, with a copy to the Trustee.
The Issuer may, at its option, satisfy the foregoing obligations with respect to any Net Proceeds from an Asset Sale by making an
Asset Sale Offer with respect to such Net Proceeds prior to the expiration of the relevant 360 days (or such longer period
provided above) or with respect to Excess Proceeds equal to or less than the greater of (i) 2.50% of Closing Date EBITDA and
(ii) 2.50% of TTM Consolidated Adjusted EBITDA as of the applicable date of determination (it being understood that such Net
Proceeds used to make an Asset Sale Offer shall satisfy the foregoing obligations with respect to Net Proceeds whether or not
such offer is accepted). To the extent that the aggregate amount of Notes (and such other Parity Lien Indebtedness or such Pari
Passu Indebtedness) tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the Issuer may use any remaining
Excess Proceeds (any such amount, “Retained Declined Proceeds”) for any purpose that is not prohibited by this Indenture and
shall not be required to use them for any other purpose. If the aggregate principal amount of Notes (and
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such other Parity Lien Indebtedness or such Pari Passu Indebtedness) surrendered by holders thereof exceeds the amount of
Excess Proceeds, the Issuer shall select the Notes to be purchased in the manner described below. Upon completion of any such
Asset Sale Offer, the amount of Excess Proceeds shall be reset at zero (regardless of whether there are any remaining Excess
Proceeds upon such completion).
Notwithstanding the foregoing, to the extent that (x) any of or all of the Net Proceeds of any Asset Sales by a Foreign
Subsidiary is prohibited or delayed by applicable local law from being repatriated to the United States or (y) repatriation to the
United States of any or all of the Net Proceeds of any Asset Sale by a Foreign Subsidiary would have a material adverse tax
consequence (taking into account any foreign tax audit or benefit actually realized in connection with such repatriation) as
determined by the Issuer in its sole discretion, exercised in good faith, the portion of such Net Proceeds so affected will not be
required to be applied in compliance with this Section 4.06, and such amounts may be retained by the applicable Foreign
Subsidiary so long, provided that (1) clause (x) of this paragraph shall apply to such amounts for so long, but only so long, as the
applicable local law will not permit repatriation to the United States (the Issuer hereby agreeing to use reasonable efforts to cause
the applicable Foreign Subsidiary to use its commercially reasonable efforts to promptly take all actions reasonably required by
the applicable local law to permit such repatriation), and once such repatriation of any of such affected Net Proceeds is permitted
under the applicable local law and is not subject to clause (y) of this paragraph, then such repatriation will be promptly effected
and such repatriated Net Proceeds will be promptly applied in compliance with this Section 4.06, and (2) in the case of where
clause (y) applies and clause (x) does not apply, (I) the Issuer shall use commercially reasonable efforts to permit such
repatriation to be effected and (II) to the extent that within 12 months of the applicable prepayment or reinvestment event, the
repatriation of any Net Proceeds from such Foreign Subsidiary would no longer have material adverse tax consequences, such
repatriation will be immediately effected and such repatriated Net Proceeds will be promptly (and in any event no later than two
Business Days after such repatriation) applied (net of additional taxes payable or reserved against as a result thereof) to the pro
rata prepayment of Indebtedness of the Issuer.
The time periods set forth in this Section 4.06 shall not start until such time as the Net Proceeds may be repatriated.
The Issuer will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and
regulations to the extent such laws or regulations are applicable in connection with the repurchase of the Notes pursuant to an
Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this
Indenture, the Issuer will comply with the applicable securities laws and regulations and shall not be deemed to have breached its
obligations described in this Indenture by virtue thereof.
Upon the expiration of the period for which the Asset Sale Offer remains open (the “Offer Period”), the Issuer shall
deliver to the Trustee for cancellation the Notes or portions thereof that have been properly tendered to and are to be accepted by
the Issuer. The Trustee (or the Paying Agent, if not the Trustee) shall, on the date of purchase, mail or deliver payment to each
tendering holder in the amount of the purchase price. In the event that the Excess Proceeds delivered by the Issuer to the Trustee
are greater than the purchase price of the Notes tendered, the Trustee shall
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deliver the excess to the Issuer immediately after the expiration of the Offer Period for application in accordance with this
Section 4.06.
Holders electing to have a Note purchased shall be required to surrender such Note, with an appropriate form duly
completed, to the Issuer at the address specified in the notice at least three Business Days prior to the purchase date. Holders
shall be entitled to withdraw their election if the Trustee or the Issuer receives not later than one Business Day prior to the
purchase date, a facsimile transmission or letter setting forth the name of the holder, the principal amount of the Note which was
delivered by the holder for purchase and a statement that such holder is withdrawing his election to have such Note purchased. If
at the end of the Offer Period more Notes (and such other Parity Lien Indebtedness or such Pari Passu Indebtedness) are tendered
pursuant to an Asset Sale Offer than the Issuer is required to purchase, the Issuer shall select the Notes (and such other Parity
Lien Indebtedness or such Pari Passu Indebtedness) to be purchased on a pro rata basis, based on the amounts tendered or
required to be purchased (with, in each case, such adjustments as may be deemed appropriate by the Issuer so that only Notes in
minimum denominations of $2,000, or an integral multiple of $1,000 in excess thereof, will be purchased; provided that any
unpurchased portion of a Note must be in a minimum denomination of $2,000). Selection of such other Parity Lien Indebtedness
and such Pari Passu Indebtedness will be made pursuant to the terms of such other Parity Lien Indebtedness or such Pari Passu
Indebtedness, as applicable.
Notices of an Asset Sale Offer shall be provided as described under Section 3.04 and Section 3.05 herein. If any Note
is to be purchased in part only, any notice of purchase that relates to such Note shall state the portion of the principal amount
thereof that has been or is to be purchased.
The Issuer and the Subsidiary Guarantors will not enter into any agreement that requires the proceeds received from
any sale of Collateral to be applied to repay, redeem, defease or otherwise acquire or retire any Indebtedness of any Person, other
than as permitted by this Indenture, the Notes the Security Documents and the Intercreditor Agreements.
SECTION 4.07
Transactions with Affiliates
.
A.
The Issuer will not, and will not permit any of the Restricted Subsidiaries to, directly or indirectly, make any
payment to, or sell, lease, transfer or otherwise dispose of any of their properties or assets to, or purchase any property or assets
from, or enter into or make or amend any transaction or series of transactions, contract, agreement, loan, advance or guarantee
with, or for the benefit of, any Affiliate of the Issuer (each of the foregoing, an “Affiliate Transaction”), unless such Affiliate
Transaction is on terms that are not materially less favorable, when taken as a whole, to the Issuer or the relevant Restricted
Subsidiary than those that could have been obtained in a comparable transaction by the Issuer or such Restricted Subsidiary with
an unrelated Person.
B.
The provisions of clause (A) above will not apply to the following:
(1)
transactions between or among the Issuer or any of the Restricted Subsidiaries or any entity that becomes a
Restricted Subsidiary as a result of such transaction, and any merger, consolidation or amalgamation of the Issuer and any direct
parent of the Issuer; provided that such
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parent shall have no material liabilities and no material assets other than cash, Cash Equivalents and the Capital Stock of the
Issuer and such merger, consolidation or amalgamation is otherwise in compliance with the terms of this Indenture and effected
for a bona fide business purpose;
(2)
transactions on terms substantially as favorable to the Issuer or such Restricted Subsidiary as would be
obtainable by the Issuer or such Restricted Subsidiary at the time in a comparable arm’s-length transaction with a Person other
than an Affiliate (as determined by the Issuer in good faith); provided that (x) any transaction pursuant to this clause (2) in excess
of $25,000,000 shall be approved by a majority of the disinterested members of the Board of Directors of Holdings or the Issuer
in good faith and (y) for any transaction pursuant to this clause (2) in excess of $50,000,000, the Issuer shall deliver to the
Trustee a letter from an Independent Financial Advisor stating that such transaction is fair to the Issuer or such Restricted
Subsidiary as would be obtainable by the Issuer or such Restricted Subsidiary at the time in a comparable arm’s-length
transaction with a Person other than an Affiliate;
(3)
the Transactions and the payment of fees and expenses (including the Transaction Expenses) related to the
Transactions on or about the Merger Date;
(4)
the issuance or transfer of Equity Interests of the Issuer or any Parent Entity to any Affiliate of the Issuer or
any Management Stockholder of the Issuer or any of its Subsidiaries or any Parent Entity to the extent otherwise permitted by
this Indenture and to the extent such issuance or transfer would not give rise to a Change of Control;
(5)
[reserved];
(6)
employment and severance arrangements and confidentiality agreements among a Parent Entity, the Issuer
and the Restricted Subsidiaries and their respective Company Persons in the ordinary course of business and transactions
pursuant to stock option, profits interest and other equity plans and employee benefit plans and arrangements;
(7)
the licensing of trademarks, copyrights or other intellectual property in the ordinary course of business to
permit the commercial exploitation of intellectual property between or among Affiliates and Subsidiaries of the Issuer;
(8)
the payment of customary fees and reasonable out-of-pocket costs to, and indemnities provided on behalf of,
any Company Person of the Issuer and the Restricted Subsidiaries or any Parent Entity in the ordinary course of business to the
extent attributable to the ownership or operation of the Issuer and the Restricted Subsidiaries;
(9)
any agreement, instrument or arrangement as in effect as of or about the Merger Date or any amendment
thereto (so long as any agreement, instrument or arrangement together with all amendments thereto, taken as a whole, is not
disadvantageous to the holders of the Notes in any material respect as compared to the applicable agreement, instrument or
arrangement as in effect on or about the Merger Date) (as determined by the Issuer in good faith);
(10)
Investments”;
Restricted Payments permitted under Section 4.04 hereof and pursuant to the definition of “Permitted
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(11)
[reserved];
(12)
transactions in which the Issuer or any of the Restricted Subsidiaries, as the case may be, delivers to the
Trustee a letter from an Independent Financial Advisor stating that such transaction is fair to the Issuer or such Restricted
Subsidiary from a financial point of view or meets the requirements of clause (a) of the preceding paragraph;
(13)
[reserved];
(14)
Investments by Jackson Wijaya and Affiliates in securities of a Parent Entity or Indebtedness of a Parent
Entity, the Issuer or any of the Restricted Subsidiaries so long as (A) the Investment is being offered generally to other investors
on the same or more favorable terms and (B) the Investment constitutes less than 5.0% of the proposed or outstanding issue
amount of such class of securities;
(15)
(16)
Financing;
payments to, or from, and transactions with, Joint Ventures;
any Asset Sale of Securitization Assets or related assets in connection with any Qualified Securitization
(17)
the existence of, or the performance by the Issuer or any Restricted Subsidiary of their obligations under the
terms of, any stockholders or other agreement (including any registration rights agreement or purchase agreement related thereto)
to which it (or any parent of the Issuer) is a party as of or about the Merger Date, and any transaction, agreement or arrangement
described in the Offering Memorandum and, in each case, any amendment thereto or similar transactions, agreements or
arrangements which it (or any parent of the Issuer) may enter into thereafter; provided, however, that the existence of, or the
performance by the Issuer or any Restricted Subsidiary of their obligations under, any future amendment to any such existing
transaction, agreement or arrangement or under any similar transaction, agreement or arrangement shall only be permitted by this
clause (17) to the extent that the terms of any such existing transaction, agreement or arrangement together with all amendments
thereto, taken as a whole, or new transaction, agreement or arrangement are not otherwise materially more disadvantageous to the
holders of the Notes than the original transaction, agreement or arrangement as in effect on or about the Merger Date or described
in the Offering Memorandum, as determined in good faith by the Issuer;
(18)
the payment of any dividend or distribution within 60 days after the date of declaration thereof, if at the date
of declaration such payment would have complied with the provisions of this Indenture;
(19)
transactions between the Issuer or any of the Subsidiaries and any Person, a director of which is also a
director of the Issuer or any Parent Entity; provided, however, that such director abstains from voting as a director of the Issuer or
such Parent Entity, as the case may be, on any matter involving such other Person;
(20)
payments, loans (or cancellation of loans) or advances to any Company Person that is (i) approved by a
majority of the Disinterested Directors of the Board of Directors of the Issuer (or a Parent Entity) in good faith and (ii) otherwise
in compliance with this Indenture;
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(21)
transactions (i) with Holdings in its capacity as a party to the ABL Credit Agreement, Term Loan Credit
Agreement and this Indenture or to any agreement, document or instrument governing or relating to (A) any Indebtedness
permitted to be Incurred pursuant to Section 4.03 herein (including Permitted Refinancings thereof) or (B) any agreement,
document or instrument governing or relating to any acquisition (whether or not consummated) and (ii) with any Affiliate in its
capacity as a lender party to the ABL Credit Agreement or Term Loan Credit Agreement or holder of the Notes or party to any
agreement, document or instrument governing or relating to any Indebtedness permitted to be Incurred pursuant to Section 4.03
herein (including Permitted Refinancings thereof) to the extent such Affiliate is being treated no more favorably than all other
lenders or holders thereunder;
(22)
transactions with customers, clients, suppliers or purchasers or sellers of goods or services, or transactions
otherwise relating to the purchase or sale of goods or services, in each case in the ordinary course of business or consistent with
past practice or industry norm and otherwise in compliance with the terms of this Indenture, which are fair to the Issuer and the
Restricted Subsidiaries in the reasonable determination of the Board of Directors of the Issuer (or a Parent Entity) or the senior
management of the Issuer (or a Parent Entity), or are on terms at least as favorable as might reasonably have been obtained at
such time from an unaffiliated party (including, for the avoidance of doubt, with Paper Excellence);
(23)
the issuance or transfer of Equity Interests (other than Disqualified Stock) of the Issuer to any Person;
(24)
the issuances of securities or other payments, awards or grants in cash, securities or otherwise pursuant to,
or the funding of, employment arrangements, stock option and stock ownership plans or similar employee benefit plans approved
by the Board of Directors of the Issuer (or any Parent Entity) or of a Restricted Subsidiary, as appropriate, in good faith;
(25)
the entering into of any tax sharing agreement or arrangement that complies with clause (g)(i) of Section
4.04(2) and the performance under any such agreement or arrangement;
(26)
(27)
(28)
(29)
any contribution to the capital of the Issuer;
transactions permitted by, and complying with, the provisions of Section 5.01 herein;
pledges of Equity Interests of Unrestricted Subsidiaries;
the formation and maintenance of any consolidated group or subgroup for tax, accounting or cash pooling
or management purposes in the ordinary course of business;
(30)
any employment agreements entered into by the Issuer or any Restricted Subsidiary in the ordinary course
of business; and
(31)
transactions undertaken in good faith (as certified by an Officer of the Issuer in an Officer’s Certificate) for
the purpose of improving the consolidated tax efficiency of the Issuer and its Subsidiaries and not for the purpose of
circumventing any covenant set forth in this Indenture.
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SECTION 4.08
Change of Control
.
(1)
Upon the occurrence of a Change of Control after the Merger Date, each holder will have the right to require
the Issuer to repurchase all or any part of such holder’s Notes at a purchase price in cash equal to 101% of the principal amount
thereof, plus accrued and unpaid interest, if any, to, but excluding, the date of repurchase (subject to the right of holders of record
on the relevant Record Date to receive interest due on the relevant Interest Payment Date), except to the extent the Issuer has
previously or concurrently elected to redeem Notes as described in Article III of this Indenture.
(2)
Within 30 days following any Change of Control, except to the extent that the Issuer has exercised its right to
redeem the Notes by delivery of a notice of redemption as described in Article III of this Indenture, the Issuer shall mail to each
holder’s registered address, or deliver electronically if held by the Depository, with a copy to the Trustee a notice (a “Change of
Control Offer”) stating:
(i)
that a Change of Control has occurred, or is expected to occur, and that such holder has the right to
require the Issuer to repurchase such holder’s Notes at a repurchase price in cash equal to 101% of the principal amount
thereof, plus accrued and unpaid interest, if any, to, but excluding, the date of repurchase (subject to the right of holders
of record on a Record Date to receive interest on the relevant Interest Payment Date);
(ii)
the transaction or transactions that constitute, or are expected to constitute, a Change of Control;
(iii)
the repurchase date, which shall be no earlier than 10 days nor later than 60 days (unless delivered
in advance of a Change of Control) from the date such notice is mailed or delivered electronically, except in the case of
a conditional Change of Control Offer made in advance of a Change of Control as described below (in which case the
expected repurchase date will be stated (which may be based on a date relative to the closing of the transaction that is
expected to result in the Change of Control and which may be tolled until the closing of such transaction)); and
(iv)
the instructions determined by the Issuer, consistent with this Section 4.08, that a holder must
follow in order to have its Notes purchased.
(3)
Holders electing to have a Note purchased shall be required to surrender the Note, with an appropriate form
duly completed, to the Issuer at the address specified in the notice at least three Business Days prior to the purchase date. The
holders shall be entitled to withdraw their election if the Trustee or the Issuer receives not later than one Business Day prior to the
purchase date a facsimile transmission or letter setting forth the name of the holder, the principal amount of the Note which was
delivered for purchase by the holder and a statement that such holder is withdrawing his election to have such Note
purchased. Holders whose Notes are purchased only in part shall be issued new Notes equal in principal amount to the
unpurchased portion of the Notes surrendered.
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(4)
On the purchase date, all Notes purchased by the Issuer under this Section 4.08 shall be delivered to the
Trustee for cancellation, and the Issuer shall pay the purchase price plus accrued and unpaid interest, if any, to the holders entitled
thereto.
(5)
A Change of Control Offer or Alternate Offer may be made and terminated in advance of a Change of
Control, and conditioned upon such Change of Control.
(6)
Notwithstanding the provisions of this Section 4.08, the Issuer shall not be required to make a Change of
Control Offer upon a Change of Control if (i) a third party makes the Change of Control Offer in the manner, at the times and
otherwise in compliance with the requirements set forth in this Indenture applicable to a Change of Control Offer made by the
Issuer and purchases all Notes validly tendered and not validly withdrawn under such Change of Control Offer, (ii) in connection
with or in contemplation of any Change of Control, the Issuer (or any Affiliate of the Issuer) or a third party has made an offer to
purchase, at the times and otherwise in compliance with the requirements set forth in this Indenture applicable to a Change of
Control Offer (an “Alternate Offer”), any and all notes validly tendered at a cash price equal to or higher than the Change of
Control payment and has purchased all Notes properly tendered in accordance with the terms of the Alternate Offer, or (iii) the
Issuer has previously issued a notice of a full redemption pursuant to Section 3.01.
(7)
Notes repurchased by the Issuer pursuant to a Change of Control Offer or Alternate Offer will have the status
of Notes issued but not outstanding or will be retired and canceled at the option of the Issuer. Notes purchased by a third party
pursuant to the preceding clause (6) will have the status of Notes issued and outstanding.
(8)
At the time the Issuer delivers Notes to the Trustee which are to be accepted for purchase, the Issuer shall
also deliver an Officer’s Certificate stating that such Notes are to be accepted by the Issuer pursuant to and in accordance with the
terms of this Section 4.08. A Note shall be deemed to have been accepted for purchase at the time the Trustee, directly or through
an agent, mails or delivers payment therefor to the surrendering holder.
(9)
Prior to any Change of Control Offer, the Issuer shall deliver to the Trustee an Officer’s Certificate stating
that all conditions precedent contained herein to the right of the Issuer to make such offer have been complied with.
(10)
The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange
Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Section 4.08. To the
extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.08, the Issuer will comply
with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Section
4.08 by virtue thereof.
(11)
The Issuer’s obligation to make an offer to repurchase the Notes as a result of a Change of Control,
including the definition of “Change of Control,” may be waived or modified with the written consent of the holders of a majority
in principal amount of the Notes then outstanding.
SECTION 4.09
Compliance Certificate
.
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(a)
The Issuer shall deliver to the Trustee within 120 days after the end of each fiscal year (beginning with the
fiscal year ending December 31, 2021), an Officer’s Certificate stating that in the course of the performance by the signer of his
or her duties as an Officer of the Issuer he or she would normally have knowledge of any Default or Event of Default and
whether or not the signer knew of any Default or Event of Default that occurred during such period (and, if a Default or Event of
Default has occurred, describing all such Defaults or Events of Default of which he or she may have knowledge and what action
the Issuer or Guarantors are taking or propose to take with respect thereto) and that to his or her knowledge no event has occurred
and remains in existence by reason of which payments on account of the principal of, premium on, if any, or interest on the Notes
is prohibited or if such event has occurred, a description of the event and what action the Issuer or Guarantors are taking or
propose to take with respect thereto.
(b)
So long as any of the Notes are outstanding, the Issuer will deliver to the Trustee, within 30 days of any
Officer becoming aware of any Default or Event of Default (unless such Default or Event of Default has been cured or waived
during such 30-day period), an Officer’s Certificate specifying such Default or Event of Default, its status and what action the
Issuer or the Guarantors are taking or propose to take with respect thereto.
SECTION 4.10
[Reserved]
.
SECTION 4.11
Future Guarantors
. The Issuer will cause Holdings (on the Merger Date) and each Wholly Owned Restricted Subsidiary that is a
Domestic Subsidiary and is not an Excluded Subsidiary and that guarantees or becomes a borrower under the Term Loan Credit
Agreement to execute and deliver to the Trustee and the Collateral Agent a supplemental indenture (i) on the Merger Date,
substantially in the form of Exhibit C-1, with respect to Holdings and such Wholly Owned Restricted Subsidiaries that are
required to become Guarantors pursuant to Section 12.07 and (ii) after the Merger Date, substantially in the form or Exhibit C-2
hereto within 20 Business Days of the date of providing such guarantee under the Term Loan Credit Agreement pursuant to
which such Restricted Subsidiary will guarantee payment of the Notes and the other Obligations under this Indenture. Each
Guarantee by a Restricted Subsidiary will be limited to an amount not to exceed the maximum amount that can be guaranteed by
that Restricted Subsidiary without rendering the Guarantee, as it relates to such Restricted Subsidiary, voidable under applicable
Law relating to fraudulent conveyance, fraudulent transfer, preference, transfer at undervalue or similar Laws affecting the rights
of creditors generally.
Each Person that becomes a Guarantor after the Merger Date shall also become a party to the applicable Security
Documents and shall as promptly as practicable execute and deliver such security instruments and financing statements (in
substantially the same form as those executed and delivered with respect to the Collateral on the Merger Date or on the date first
delivered in the case of Collateral that this Indenture provides may be delivered after the Merger Date (to the extent, and
substantially in the form, delivered on the Merger Date or the date first delivered, as applicable (but no greater scope)) as may be
necessary to vest in the Collateral Agent a perfected first-priority security interest (subject to Permitted Liens) in properties and
assets that constitute Fixed Asset Collateral and a perfected second-priority security interest (subject to Permitted Liens) in
properties and assets that constitute Current Asset Collateral, in either case, as security for such Guarantor’s Guarantee and as
may be necessary to have such property or asset added to the Collateral as required under the Security Documents and this
Indenture, and thereupon all
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provisions of this Indenture relating to the Collateral shall be deemed to relate to such properties and assets to the same extent
and with the same force and effect.
Each Guarantor’s Guarantee shall be released in accordance with the provisions of Section 12.02.
SECTION 4.12
Liens
.
(a)
(b)
Prior to a Covenant Suspension Event, following any Reversion Date and during any Suspension Period when
there is no election by the Issuer pursuant to clause (b) below, the Issuer will not, and will not permit any Restricted
Subsidiary to, directly or indirectly, create, Incur or suffer to exist any Lien (except Permitted Liens) on any asset or
property of the Issuer or such Restricted Subsidiary securing Indebtedness of the Issuer or a Restricted Subsidiary
unless solely with respect to any assets or property that are not at such time Collateral, if the Issuer or any Subsidiary
Guarantor creates any Lien upon any property or assets that are not at such time Collateral to secure any Priority Lien
Indebtedness or Parity Lien Indebtedness, it must concurrently grant a first-priority Lien upon such property or assets
that would constitute Fixed Asset Collateral or a second-priority Lien upon such property or assets that would
constitute Current Asset Collateral as security for the Notes or the applicable Guarantee, such that the property or assets
subject to such Lien will constitute Collateral under this Indenture and the Security Documents, subject, in each case, to
local law limitations and Permitted Liens until such time as such Indebtedness is no longer secured by a Lien.
Following a Covenant Suspension Event, the Issuer may elect by written notice to the Trustee to be subject to
an alternative covenant with respect to the limitation on Liens in lieu of the preceding paragraph (the date such notice is
delivered, the “Liens Covenant Election Date”). Under this alternative covenant, from and after a Liens Covenant
Election Date and until a Reversion Date (upon which Reversion Date, the Issuer and each Restricted Subsidiary shall
be subject to the limitation on Liens as set forth in paragraph (a) above, the Issuer will not, and will not permit any of
the Issuer’s Principal Property Subsidiaries to, directly or indirectly, create, Incur any Lien of any kind upon any
(1) Restricted Property or (2) shares of Capital Stock or evidence of Indebtedness for borrowed money issued by any
Principal Property Subsidiary, whether owned at the Issue Date or thereafter acquired, without making effective
provision, and the Issuer in such case will make or cause to be made effective provision, whereby the Notes and the
applicable Guarantees, if any, shall be secured by such Lien equally and ratably with any and all other Indebtedness or
obligations thereby secured, so long as such Indebtedness or obligations shall be so secured; provided, however, that the
foregoing shall not apply to any of the following:
(1)
(2)
Liens that exist on the date of the Covenant Suspension Event;
Liens on property, shares of Capital Stock or evidence of Indebtedness of any corporation or other entity
existing at the time such corporation or other entity becomes a Subsidiary Guarantor;
(3)
Liens in favor of the Issuer or any Restricted Subsidiary (other than Liens of property or assets of the Issuer
or any Subsidiary Guarantor in favor of any Subsidiary that is not a Subsidiary Guarantor);
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(4)
Liens in favor of governmental bodies to secure progress, advance or other payments pursuant to contract or
statute or Indebtedness Incurred to finance all or a part of construction of or improvements to property subject to such Liens;
(5)
Liens (i) on property, shares of Capital Stock or evidences of Indebtedness for borrowed money existing at
the time of acquisition thereof (including acquisition through merger, amalgamation or consolidation), and construction and
improvement Liens that are entered into within one year from the date of such construction or improvement; provided that in the
case of construction or improvement the Lien shall not apply to any property theretofore owned by the Issuer or any Subsidiary
Guarantor except substantially unimproved real property on which the property so constructed or the improvement is located and
(ii) for the acquisition of any real property, which Liens are created within 180 days after the completion of such acquisition to
secure or provide for the payment of the purchase price of the real property acquired; provided that with respect to clauses (i) and
(ii), any such Liens do not extend to any other property of the Issuer or any of the Subsidiary Guarantors (whether such property
is then owned or thereafter acquired);
(6)
mechanics’, landlords’ and similar Liens arising in the ordinary course of business in respect of obligations
not due or being contested in good faith;
(7)
in good faith;
Liens for taxes, assessments, or governmental charges or levies that are not delinquent or are being contested
(8)
Liens arising from any legal proceedings that are being contested in good faith;
(9)
any Liens that (i) are incidental to the ordinary conduct of its business or the ownership of its properties and
assets, including Liens incurred in connection with workmen’s compensation, unemployment insurance or other forms of
governmental insurance or benefits, or to secure performance of tenders, statutory obligations, leases and contracts, (ii) were not
incurred in connection with the borrowing of money or the obtaining of advances or credit and (iii) do not in the aggregate
materially detract from the value of the property of the Issuer or any Subsidiary Guarantor or materially impair the use thereof in
the operation of its business;
(10)
Liens to secure a purchase money obligation, so long as the Lien does not apply to other property owned by
the Issuer or any Restricted Subsidiary at the time of the commencement of the construction or improvement of, or immediately
prior to the consummation of the acquisition of, the property that is subject to the purchase money obligation; and
(11)
Liens for the sole purpose of extending, renewing or replacing in whole or in part any of the foregoing,
provided that, notwithstanding the provisions of this paragraph (b), during any Suspension Period, if the Liens
Covenant Election Date has occurred, the Issuer or any Subsidiary may, without equally and ratably securing the Notes and the
Guarantees, if any, create or assume Liens that would otherwise be subject to the foregoing restrictions if at the time of such
creation or assumption, and after giving effect thereto, Exempted Indebtedness does not exceed 10% of Total Assets.
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(c)
Any Lien that is granted to secure the Notes or any Guarantee under the preceding paragraph shall be
automatically and unconditionally released and discharged at the same time as the release of the Lien that gave rise to the
obligation to secure the Notes or such Guarantee.
(d)
For purposes of determining compliance with this Section 4.12, (A) a Lien securing an item of Indebtedness
(or any portion thereof) need not be permitted solely by reference to one category of Permitted Liens (or any portion thereof)
described in the definition of “Permitted Liens” or pursuant to paragraph (a) above but may be permitted in part under any
combination thereof and (B) in the event that a Lien securing an item of Indebtedness (or any portion thereof) meets the criteria
of one or more of the categories of permitted Liens (or any portion thereof) described in the definition of “Permitted Liens” or
pursuant to paragraph (a) above, the Issuer may, in its sole discretion, divide, classify or reclassify, or later divide, classify or
reclassify (as if Incurred at such later time), such Lien securing such item of Indebtedness (or any portion thereof) in any manner
that complies with this Section 4.12 and at the time of classification or reclassification will be entitled to only include the amount
and type of such Lien or such item of Indebtedness secured by such Lien (or any portion thereof) in one of the categories of
permitted Liens (or any portion thereof) described in the definition of “Permitted Liens” or pursuant to paragraph (a) above and,
in such event, such Lien securing such item of Indebtedness (or any portion thereof) will be treated as being Incurred or existing
pursuant to only such clause or clauses (or any portion thereof) or pursuant to the first paragraph hereof without giving Pro
Forma Effect to such item (or any portion thereof) when calculating the amount of Liens or Indebtedness (or any portion thereof)
that may be Incurred pursuant to any other clause or paragraph (or any portion thereof) at such time; provided that, all Liens
created pursuant to the Term Loan Credit Agreement and the ABL Credit Agreement, in each case on the Merger Date, will be
deemed to have been Incurred in reliance on the exceptions in clauses (a) and (b) of the definition of “Permitted Liens”,
respectively, and will not be permitted to be reclassified pursuant to this paragraph. In addition, with respect to any revolving
loan Indebtedness or commitment relating to the Incurrence of Indebtedness that is designated to be Incurred on any date
pursuant to Section 4.03(3) herein, any Lien that does or that shall secure such Indebtedness may also be designated by the Issuer
to be Incurred on such date and, in such event, any related subsequent actual Incurrence of such Lien shall be deemed for all
purposes under this Indenture to be Incurred on such prior date, including for purposes of calculating usage of any “Permitted
Lien” until such time as the related Indebtedness is no longer deemed outstanding pursuant to clause (c) of Section 4.03(2) herein
or the Issuer shall later divide, classify or reclassify such Lien in any other manner that complies with this Section 4.12. See also
Section 1.05 herein.
(12)
With respect to any Lien securing Indebtedness that was permitted to secure such Indebtedness at the time
of the Incurrence of such Indebtedness, such Lien shall also be permitted to secure any Increased Amount of such Indebtedness.
The “Increased Amount” of any Indebtedness shall mean any increase in the amount of such Indebtedness in connection with any
accrual of interest, the accretion of accreted value, the amortization of original issue discount or deferred financing costs, the
payment of interest in the form of additional Indebtedness with the same terms or in the form of common stock of the Issuer, the
payment of dividends on Preferred Stock in the form of additional shares of Preferred Stock of the same class, accretion of
original issue discount or deferred financing costs or liquidation preference and increases in the amount of Indebtedness
outstanding solely as a result of fluctuations in the exchange rate of currencies or
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increases in the value of property securing Indebtedness described in clause (c) of the definition of “Indebtedness”.
SECTION 4.13
Activities Prior to the Escrow Release
.
(a)
Prior to the Merger Date, the Escrow Issuer’s primary activities will be restricted to issuing the Notes, issuing
capital stock to, and receiving capital contributions, funds, loans and advances from direct and indirect parent companies of the
Escrow Issuer, performing its obligations in respect of the Notes under this Indenture and the Escrow Agreement, performing its
obligations under the Merger Agreement, performing its obligations in connection with any tender offer for the Existing Notes or
any solicitation of consents from holders of the Existing Notes, consummating the Merger and the Escrow Release and redeeming
the Notes pursuant to Section 3.10, if applicable, and conducting such other activities as are necessary, advisable or appropriate to
carry out the activities described above or related to the Transactions. Prior to the Merger Date, the Escrow Issuer will not own,
hold or otherwise have any interest in any assets other than the Escrow Account, cash and Cash Equivalents and its rights under
the Notes and this Indenture.
(b)
Prior to the Merger Date, the Escrow Issuer shall not engage in any activity or enter into any transaction or
agreement (including, without limitation, making any Restricted Payment, incurring any Indebtedness, Disqualified Stock or
Preferred Stock (except the Notes), incurring any Liens except in favor of the Escrow Agent, Trustee and/or the Holders of the
Notes, entering into any merger (other than the Merger), consolidation or sale of all or substantially all of its assets or engaging in
any transaction with its Affiliates) except in the ordinary course of business or as necessary, advisable or appropriate to effectuate
the Merger and the Transactions substantially in accordance with the description of the Transactions set forth in this offering
memorandum, together with such amendments, modifications and waivers that are not, individually or in the aggregate,
materially adverse (after giving effect to the consummation of the Merger) to the holders of the notes.
SECTION 4.14
Maintenance of Office or Agency
.
(a)
The Issuer will maintain in the United States, an office or agency (which may be an office of the Trustee or
an Affiliate of the Trustee, Registrar or co-registrar) where Notes may be surrendered for registration of transfer or for exchange
and where notices and demands to or upon the Issuer in respect of the Notes and this Indenture may be served. The Issuer will
give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time
the Issuer shall fail to maintain any such required office or agency or fails to furnish the Trustee with the address thereof, such
presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee as set forth in
Section 13.02; provided that no service of legal process against the Issuer or any Guarantors may be made at any office of the
Trustee.
(b)
The Issuer may also from time to time designate one or more other offices or agencies where the Notes may
be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided,
however, that no such designation or rescission will in any manner relieve the Issuer of its obligation to maintain an office or
agency in the United States for such purposes. The Issuer will give prompt written notice to the Trustee of
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any such designation or rescission and of any change in the location of any such other office or agency.
(c)
The Issuer hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the
Issuer in accordance with Section 2.04 herein.
SECTION 4.15
Covenant Suspension
.
(a)
If on any date following the Issue Date, (i) the Notes have Investment Grade Ratings from any two out of the
three Rating Agencies, and (ii) no Default has occurred and is continuing under this Indenture then, beginning on that day (the
occurrence of the events described in the foregoing clauses (i) and (ii) being collectively referred to as a “Covenant Suspension
Event”), then, beginning on that day and continuing at all times thereafter and subject to the provisions of the succeeding
paragraph, Sections 4.03, 4.04, 4.05, 4.06 (but only to the extent related to properties or assets of the Issuer or its Restricted
Subsidiaries that do not constitute Collateral), 4.07, 4.11, upon the making of the election described under Section 4.12(b),
Section 4.12(a) and 5.01(a)(iv) herein (collectively, the “Suspended Covenants”) will not be applicable to the Notes.
(b)
If and while the Issuer and the Restricted Subsidiaries are not subject to the Suspended Covenants, the Notes
will be entitled to substantially less covenant protection. In the event that the Issuer and the Restricted Subsidiaries are not
subject to the Suspended Covenants under this Indenture for any period of time as a result of the foregoing, and on any
subsequent date (the “Reversion Date”) there is a withdrawal of an Investment Grade Rating or downgrade of the rating assigned
to the Notes below an Investment Grade Rating such that, as a result, the Notes no longer have an Investment Grade Rating from
any two out of the three Rating Agencies, then the Issuer and the Restricted Subsidiaries will thereafter again be subject to the
Suspended Covenants under this Indenture with respect to future events. The Guarantees of the Subsidiary Guarantors will be
automatically released during the Suspension Period pursuant to Section 12.02 (subject, for the avoidance of doubt, to
reinstatement to the extent required by clause (e) below).
(c)
The Issuer will provide the Trustee with notice of each Covenant Suspension Event or Reversion Date
within five Business Days of the occurrence thereof. The Trustee shall have no duty to monitor the ratings of the Notes or the
occurrence of a Covenant Suspension Event or Reversion Date or provide notice to the holders of the Notes of any such
Covenant Suspension Event or Reversion Date.
(d)
On each Reversion Date, all Indebtedness Incurred, or Disqualified Stock or Preferred Stock issued,
during the Suspension Period will be classified as having been outstanding on the Merger Date, so that it is classified as permitted
under Section 4.03(2)(c). Except as described in this paragraph (d), calculations made after the Reversion Date of the amount
available to be made as Restricted Payments under Section 4.04 hereof will be made as though Section 4.04 hereof had been in
effect since the Merger Date and prior to, but not during, the Suspension Period. Accordingly, Restricted Payments made during
the Suspension Period will not reduce the amount available to be made as Restricted Payments under Section 4.04 hereof, except
as described in the immediately succeeding sentence. No Subsidiary may be designated as an Unrestricted Subsidiary during the
Suspension Period, unless such designation would have complied with Section 4.04
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hereof when made as if such covenant were in effect during such period; provided that, calculation of amounts available to be
made as Restricted Payments pursuant to Section 4.04 hereof on and after the Reversion Date shall take into account and deduct
any amounts used for such designation during the Suspension Period as if such covenant were in effect throughout the
Suspension Period. Any Affiliate Transaction entered into after the Reversion Date pursuant to an agreement entered into during
any Suspension Period shall be deemed to be permitted pursuant to Section 4.07(B)(17), and for purposes of Section 4.05 hereof,
all contracts entered into during the Suspension Period prior to such Reversion Date that contain any of the restrictions
contemplated by such covenant will be deemed to have been entered pursuant to clause (1) of the second paragraph of Section
4.05 hereof.
(e)
As described above, however, no Default or Event of Default (as defined below) will be deemed to have
occurred on the Reversion Date as a result of any actions taken by the Issuer or the Restricted Subsidiaries during the Suspension
Period and the Issuer and any Subsidiary of the Issuer will be permitted, without causing a Default or Event of Default or breach
of any of the Suspended Covenants (notwithstanding the reinstatement thereof) under this Indenture, to honor, comply with or
otherwise perform any contractual commitments or obligations entered into during a Suspension Period following a Reversion
Date and to consummate the transactions contemplated thereby; provided that, to the extent any such commitment or obligation
results in the making of a Restricted Payment, such Restricted Payment shall be made using the amount available under Section
4.04(1)(iii) hereof or under Section 4.04(2) hereof, and if not permitted by any such provisions, such Restricted Payment shall be
deemed permitted under Section 4.40(1)(iii) hereof and shall be deducted for purposes of calculating the amount of the
Cumulative Credit remaining available pursuant to Section 4.04(1)(iii) hereof (which may not be less than zero). The Issuer shall
be required to comply and cause its Restricted Subsidiaries to comply with Section 4.11 hereof after the Reversion Date with
respect to any guarantee entered into by such Subsidiary during the Suspension Period to the extent required by Section 4.11
hereof.
(f)
For purposes of Section 4.06, on the Reversion Date, the unutilized Excess Proceeds amount will be reset to
zero.
ARTICLE V
SUCCESSOR COMPANY
SECTION 5.01
When Issuer and Guarantors May Merge or Transfer Assets
.
(1)
The Issuer may not, directly or indirectly, consolidate, amalgamate or merge with or into or wind up or
convert into, consummate a Division as the Dividing Person (whether or not the Issuer is the surviving Person), or sell, assign,
transfer, lease, convey or otherwise dispose of all or substantially all (whether now owned or hereafter acquired) of its properties
or assets in one or more related transactions, to any Person (other than the Transactions) unless:
(a)
the Issuer is the surviving Person or the Person formed by or surviving following any such
consolidation, amalgamation, merger, winding up or conversion, the Division Successor surviving any Division (if
other than such Issuer) or to which such sale, assignment, transfer, lease, conveyance or other disposition will have
been made is a
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corporation, partnership or limited liability company or similar entity organized or existing under the laws of the United
States, any state thereof, the District of Columbia, or any territory of the United States (the Issuer or such Person, as the
case may be, being herein called the “Successor Company”);
(b)
(x) the Successor Company (if other than the Issuer) expressly assumes all the obligations of the
Issuer under this Indenture, the Notes and the Security Documents pursuant to supplemental indentures or other
applicable documents or instruments or (y) in the case of a Division where the Issuer is the Dividing Person, the
Division Successor shall remain or become a co-issuer of the Notes;
(c)
immediately after giving effect to such transaction (and treating any Indebtedness which becomes
an obligation of the Successor Company or any Restricted Subsidiary as a result of such transaction as having been
Incurred by the Successor Company or such Restricted Subsidiary at the time of such transaction) no Event of Default
shall have occurred and be continuing;
(d)
immediately after giving Pro Forma Effect to such transaction, as if such transaction had occurred at
the beginning of the applicable four-quarter period (and treating any Indebtedness which becomes an obligation of the
Successor Company or any Restricted Subsidiary as a result of such transaction as having been Incurred by the
Successor Company or such Restricted Subsidiary at the time of such transaction), the Successor Company would be
permitted to Incur at least $1.00 of additional Indebtedness as Ratio Debt;
(e)
if the Issuer is not the Successor Company, each Guarantor, unless it is the other party to the
transactions described above, shall have by supplemental indenture confirmed that its Guarantee shall apply to such
Person’s obligations under this Indenture and the Notes, and that the Security Documents shall continue to be in effect
and such Guarantor shall cause such amendments, supplements or other instruments to be executed, filed and recorded
in such jurisdictions as may be required by applicable Law to preserve and protect the Lien on the Collateral owned by
such Guarantor;
(f)
to the extent any property or assets of the Successor Company, or the Person that is merged,
amalgamated or consolidated with or into the Successor Company, are property or assets of the type that would
constitute Collateral under the Security Documents or the Intercreditor Agreements, the Successor Company will take
such action as may be reasonably necessary or required to cause such property and assets to be made subject to a Lien
securing the Notes pursuant to this Indenture, the Security Documents and the Intercreditor Agreements in the manner
and to the extent required by this Indenture or any of the Security Documents or Intercreditor Agreements and shall
take all reasonably necessary action so that such Lien is perfected, preserved and protected to the extent required by
this Indenture, the Security Documents and the Intercreditor Agreements;
(g)
Collateral owned by or sold, assigned, conveyed, leased, transferred or otherwise disposed of to the
Successor Company shall (a) continue to constitute Collateral under this Indenture and the Security Documents, (b) be
subject to the Lien in favor of the
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Collateral Agent for the benefit of itself, the Trustee and the holders of the Notes and (c) not be subject to any Lien
other than Permitted Liens or other Liens as permitted under Section 4.12;
(h)
the Successor Company shall become a party to the ABL Intercreditor Agreement and the Pari
Passu Intercreditor Agreement by joinder or supplement; and
(i)
the Successor Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion
of Counsel, each stating that such consolidation, merger, amalgamation or transfer and such supplemental indentures (if
any) comply with this Indenture.
The Successor Company (if other than the Issuer) will succeed to, and be substituted for, the Issuer under this
Indenture, the Notes, the Security Documents and the Intercreditor Agreements, and in such event the Issuer will automatically
be released and discharged from its obligations under this Indenture, the Notes, the Security Documents and the Intercreditor
Agreements. Notwithstanding the foregoing clauses (c) and (d), (a) the Issuer or any Restricted Subsidiary may merge,
consolidate or amalgamate with, consummate a Division as the Dividing Person or transfer all or part of their properties and
assets to a Restricted Subsidiary, (b) the Issuer may merge, consolidate or amalgamate with an Affiliate incorporated solely for
the purpose of reincorporating or reorganizing the Issuer in another state of the United States, the District of Columbia (each, a
“Permitted Jurisdiction”) or may convert into a corporation or limited liability company or similar entity, so long as the amount
of Indebtedness of the Issuer and the Restricted Subsidiaries is not increased thereby, (c) the Issuer may convert into a
corporation or limited liability company or similar entity organized or existing under the laws of the United States, any state
thereof or the District of Columbia and (d) the Issuer may change its name. This Section 5.01 will not apply to a sale, assignment,
transfer, conveyance or other disposition of assets between or among the Issuer and the Restricted Subsidiaries, including, for the
avoidance of doubt, pursuant to Qualified Securitization Financings.
(2)
Subject to certain provisions in this Indenture governing release of a Guarantee upon the sale or disposition
of a Restricted Subsidiary of the Issuer that is a Subsidiary Guarantor and other release provisions, no Subsidiary Guarantor will,
and the Issuer will not permit any Subsidiary Guarantor to, consolidate, amalgamate or merge with or into or wind up into,
consummate a Division as the Dividing Person (whether or not such Subsidiary Guarantor is the surviving Person), or sell,
assign, transfer, lease, convey or otherwise dispose of all or substantially all of its properties or assets in one or more related
transactions to, any Person (other than the Transactions) unless:
(a)
either (i) such Subsidiary Guarantor is the surviving or continuing Person or the Person formed by
or surviving or continuing following any such consolidation, amalgamation or merger, the Division Successor surviving
any Division (if other than such Subsidiary Guarantor) or to which such sale, assignment, transfer, lease, conveyance or
other disposition will have been made is a company, corporation, partnership or limited liability company or similar
entity organized or existing under the laws of the United States, any state thereof, the District of Columbia or any
territory of the United States (such Subsidiary Guarantor or such Person, as the case may be, being herein called the
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“Successor Subsidiary Guarantor”) and the Successor Subsidiary Guarantor (if other than such Subsidiary Guarantor)
expressly assumes all the obligations of such Subsidiary Guarantor under this Indenture, the Guarantee, and the
Security Documents, as applicable, pursuant to a supplemental indenture or other applicable documents or instruments,
or (ii) such sale or disposition or consolidation, amalgamation or merger is not in violation of Section 4.06;
(b)
to the extent any property or assets of the Successor Subsidiary Guarantor, or the Person that is
merged, amalgamated or consolidated with or into the Successor Subsidiary Guarantor, are property or assets of the
type that would constitute Collateral under the Security Documents or the Intercreditor Agreements, the Successor
Subsidiary Guarantor will take such action as may be reasonably necessary or required to cause such property and
assets to be made subject to a Lien securing the Notes pursuant to this Indenture, the Security Documents and the
Intercreditor Agreements in the manner and to the extent required by this Indenture or any of the Security Documents
or Intercreditor Agreements, and shall take all reasonably necessary action so that such Lien is perfected, preserved and
protected to the extent required by this Indenture, the Security Documents and the Intercreditor Agreements;
(c)
the Collateral owned by or sold, assigned, conveyed, leased, transferred or otherwise disposed of to
the Successor Subsidiary Guarantor shall (a) continue to constitute Collateral under this Indenture, the Security
Documents and the Intercreditor Agreements, (b) be subject to the Lien in favor of the Collateral Agent for the benefit
of itself, the Trustee and the holders of the Notes and (c) not be subject to any Lien other than Permitted Liens or other
Liens as permitted under Section 4.12;
(d)
the Successor Subsidiary Guarantor shall become a party to the ABL Intercreditor Agreement and
the Pari Passu Intercreditor Agreement by joinder or supplement; and
(e)
the Successor Subsidiary Guarantor (if other than such Subsidiary Guarantor) shall have delivered
or caused to be delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such
consolidation, amalgamation, merger or transfer and such supplemental indenture (if any) comply with this Indenture.
Except as otherwise provided in this Indenture, the Successor Subsidiary Guarantor (if other than such Subsidiary
Guarantor) will succeed to, and be substituted for, such Subsidiary Guarantor under this Indenture, the Guarantee, the Security
Documents and the Intercreditor Agreements, as applicable, and such Subsidiary Guarantor will automatically be released and
discharged from its obligations under this Indenture, its Guarantee, the Security Documents and the Intercreditor Agreements.
Notwithstanding the foregoing, (1) a Subsidiary Guarantor may merge, amalgamate or consolidate with an Affiliate incorporated
solely for the purpose of reincorporating or reorganizing such Subsidiary Guarantor in a Permitted Jurisdiction or may convert
into a limited liability company, corporation, partnership or similar entity organized or existing under the laws of any Permitted
Jurisdiction so long as the amount of Indebtedness of such Subsidiary Guarantor is not increased thereby, (2) a Subsidiary
Guarantor may merge, amalgamate or consolidate with the Issuer or any Restricted Subsidiary, (3) any Subsidiary
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Guarantor may convert into a corporation, partnership or limited liability company or similar entity organized or existing under
the laws of the United States, any state thereof, the District of Columbia or any territory of the United States and (4) any
Subsidiary Guarantor may change its name.
In addition, notwithstanding the foregoing, a Subsidiary Guarantor may consolidate, amalgamate or merge with or into
or wind up into, liquidate, dissolve, or sell, assign, transfer, lease, convey or otherwise dispose of all or substantially all of its
properties or assets to the Issuer or any Restricted Subsidiary.
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01
Events of Default
. An “Event of Default” occurs with respect to Notes if:
(1)
(2)
there is a default in any payment of interest on any Note when due, continued for 30 days;
there is a default in the payment of principal or premium, if any, of any Note when due at its Stated Maturity,
upon optional redemption, upon required repurchase, upon declaration or otherwise;
(3)
there is failure by the Issuer for 120 days after receipt of written notice given by the Trustee or the holders of
not less than 30% in aggregate principal amount of the Notes then outstanding (with a copy to the Trustee) to comply with any of
its obligations, covenants or agreements contained in Section 4.02;
(4)
there is a failure by the Issuer or any Restricted Subsidiary for 90 days after written notice given by the
Trustee or the holders of not less than 30% in aggregate principal amount of the Notes then outstanding (with a copy to the
Trustee) to comply with its other obligations, covenants or agreements (other than a default referred to in clauses (1), (2) and
(3) above) contained in the Notes, this Indenture or the Security Documents;
(5)
there is a failure by the Issuer or any Significant Subsidiary (other than any Securitization Subsidiary) (or
any group of Subsidiaries that together would constitute a Significant Subsidiary, other than any Securitization Subsidiary) to pay
any Indebtedness for borrowed money (other than Indebtedness owing to the Issuer or a Restricted Subsidiary or any Qualified
Securitization Financing) within any applicable grace period after final maturity or the acceleration of any such Indebtedness by
the holders thereof because of a default, in each case, if the total amount of such Indebtedness unpaid or accelerated exceeds the
greater of (I) 25% of Closing Date EBITDA and (II) 25% of TTM Consolidated Adjusted EBITDA as of the applicable date of
determination, or, in each case, its foreign currency equivalent;
(6)
the Issuer or a Significant Subsidiary (other than any Securitization Subsidiary) (or any group of Subsidiaries
that together would constitute a Significant Subsidiary, other than any Securitization Subsidiary) pursuant to or within the
meaning of any Bankruptcy Law:
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(i)
(ii)
(iii)
(iv)
commences a voluntary case;
consents to the entry of an order for relief against it in an involuntary case;
consents to the appointment of a Custodian of it or for any substantial part of its property; or
makes a general assignment for the benefit of its creditors or takes any comparable action under
any foreign laws relating to insolvency;
(7)
a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i)
is for relief against the Issuer or any Significant Subsidiary (other than any Securitization
Subsidiary) (or any group of Subsidiaries that together would constitute a significant Subsidiary, other than any
Securitization Subsidiary) in an involuntary case;
(ii)
appoints a Custodian of the Issuer or any Significant Subsidiary (other than any Securitization
Subsidiary) (or any group of Subsidiaries that together would constitute a significant Subsidiary, other than any
Securitization Subsidiary) or for any substantial part of its property; or
(iii)
orders the winding up or liquidation of the Issuer or any Significant Subsidiary (other than any
Securitization Subsidiary) (or any group of Subsidiaries that together would constitute a significant Subsidiary, other
than any Securitization Subsidiary);
(iv)
or any similar relief is granted under any foreign laws and the order or decree remains unstayed
and in effect for 60 days,
(8)
there is a failure by the Issuer or any Significant Subsidiary (other than any Securitization Subsidiary) (or
any group of Subsidiaries that together would constitute a Significant Subsidiary, other than any Securitization Subsidiary) to pay
final judgments aggregating in excess of the greater of (x) 25% of Closing Date EBITDA and (y) 25% of TTM Consolidated
Adjusted EBITDA as of the applicable date of determination or, in each case, its foreign currency equivalent (net of any amounts
which are covered by enforceable insurance policies issued by solvent carriers), which judgments are not discharged, waived or
stayed for a period of 60 days;
(9)
the Guarantee of a Significant Subsidiary (or any group of Subsidiaries that together would constitute a
Significant Subsidiary) with respect to the Notes ceases to be in full force and effect (except as contemplated by the terms
thereof) or the Issuer or any Subsidiary Guarantor that qualifies as a Significant Subsidiary (or any group of Subsidiaries that
together would constitute a Significant Subsidiary) denies or disaffirms in writing its obligations under this Indenture or any
Guarantee with respect to the Notes (except as contemplated by the terms thereof) and such Default continues for 10 days;
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(10)
(x) any material provision of any Security Document or Intercreditor Agreement with respect to the Notes,
at any time, (a) ceases to be in full force and effect for any reason other than in accordance with the terms of this Indenture, the
Security Documents and the Intercreditor Agreements or (b) is declared invalid or unenforceable by a court of competent
jurisdiction, (y) the Issuer or any Guarantor contests in writing the validity or enforceability of any provision of any Security
Document or Intercreditor Agreement or (z) the Issuer or any Guarantor denies in writing that it has any further liability under
this Indenture or any Security Document or Intercreditor Agreement or gives written notice to revoke or rescind any Security
Document or the perfected first-priority or second-priority Liens, as applicable, created thereby with respect to such series of
notes, other than in accordance with the terms of this Indenture, the Security Documents and the Intercreditor Agreements;
(11)
any Security Document covering a material portion of the Collateral for any reason (other than pursuant to
the terms thereof) ceases to create a valid and perfected first-priority or second-priority Lien, as applicable, on and security
interest in any material Collateral covered thereby with respect to the Notes, subject to Permitted Liens, except to the extent that
any such perfection or priority is not required pursuant to this Indenture and the Security Documents or results from the failure of
the Collateral Agent to maintain possession of certificates actually delivered to it representing securities pledged under the
Security Documents;
(12)
failure by the Issuer to consummate the Special Mandatory Redemption as described in Section 3.10; or
(13)
Section 3.11.
failure by the Issuer to consummate the Special Change of Control Mandatory Redemption as described in
The foregoing shall constitute Events of Default whatever the reason for any such Event of Default and whether it is
voluntary or involuntary or is effected by operation of law or pursuant to any judgment, decree or order of any court or any order,
rule or regulation of any administrative or governmental body.
However, a default under clauses (3) or (4) will not constitute an Event of Default until the Trustee notifies the Issuer or
the holders of at least 30% in aggregate principal amount of outstanding Notes notify the Issuer, with a copy to the Trustee, of the
default and the Issuer does not cure such default within the time specified in clauses (3) or (4) hereof after receipt of such notice.
Such notice must specify the Default, demand that it be remedied and state that such notice is a “Notice of Default.”
If a Default occurs and is continuing and is actually known to a Trust Officer or the written notice thereof is received by
the Trustee at the Corporate Trust Office, the Trustee must mail, or deliver electronically if held by the Depository, to each holder
of the Notes notice of the Default within the later of 90 days after it occurs or 30 days after it is actually known to a Trust Officer
or written notice of it is received by the Trustee (unless such Default has been cured or waived during such time). Except in the
case of a Default in the payment of principal of, premium (if any) or interest on any Note, the Trustee may withhold notice if and
so long as the Trustee in good faith determines that withholding notice is in the interests of the noteholders.
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Any notice of Default, notice of acceleration or instruction to the Trustee or the Collateral Agent, as applicable, to
provide a notice of Default, notice of acceleration or take any other action (a “Noteholder Direction”) provided by any one or
more holders (other than a Regulated Bank) (each a “Directing Holder”) must be accompanied by a written representation from
each such holder delivered to the Issuer and the Trustee or the Collateral Agent, as applicable, that such holder is not (or, in the
case such holder is the Depository or its nominee, that such holder is being instructed solely by beneficial owners that are not)
Net Short (a “Position Representation”), which representation, in the case of a Noteholder Direction relating to the delivery of a
notice of Default shall be deemed a continuing representation until the resulting Event of Default is cured or otherwise ceases to
exist or the Notes are accelerated. In addition, each Directing Holder is deemed, at the time of providing a Noteholder Direction,
to covenant to provide the Issuer with such other information as the Issuer may reasonably request from time to time in order to
verify the accuracy of such Noteholder’s Position Representation within five Business Days of request therefor (a “Verification
Covenant”). In any case in which the holder is the Depository or its nominee, any Position Representation or Verification
Covenant required hereunder shall be provided by the beneficial owner of the Notes in lieu of the Depository or its nominee, and
the Depository shall be entitled to conclusively rely on such Position Representation and Verification Covenant in delivering its
direction to the Trustee.
If, following the delivery of a Noteholder Direction, but prior to acceleration of the Notes, the Issuer determines in
good faith that there is a reasonable basis to believe a Directing Holder was, at any relevant time, in breach of its Position
Representation and provides to the Trustee an Officer’s Certificate stating that the Issuer has initiated litigation in a court of
competent jurisdiction seeking a determination that such Directing Holder was, at such time, in breach of its Position
Representation, and seeking to invalidate any Event of Default that resulted from the applicable Noteholder Direction, the cure
period with respect to such Default shall be automatically stayed and the cure period with respect to such Event of Default shall
be automatically reinstituted and any remedy stayed pending a final and non-appealable determination of a court of competent
jurisdiction on such matter. If, following the delivery of a Noteholder Direction, but prior to acceleration of the Notes, the Issuer
provides to the Trustee an Officer’s Certificate stating that a Directing Holder failed to satisfy its Verification Covenant, the cure
period with respect to such Default shall be automatically stayed and the cure period with respect to any Event of Default that
resulted from the applicable Noteholder Direction shall be automatically reinstituted and any remedy stayed pending satisfaction
of such Verification Covenant. Any breach of the Position Representation shall result in such holder’s participation in such
Noteholder Direction being disregarded; and, if, without the participation of such holder, the percentage of Notes held by the
remaining holders that provided such Noteholder Direction would have been insufficient to validly provide such Noteholder
Direction, such Noteholder Direction shall be void ab initio, with the effect that such Event of Default shall be deemed never to
have occurred, acceleration voided and the Trustee and the Collateral Agent shall be deemed not to have received the Noteholder
Direction or any notice of such Default or Event of Default.
For the avoidance of doubt, (i) the foregoing paragraphs shall not apply to any holder that is a Regulated Bank and (ii)
the Trustee and the Collateral Agent shall be entitled to conclusively rely, without liability, on any Noteholder Direction delivered
to it in accordance with this Indenture, shall have no duty to inquire as to or investigate the accuracy of any Position
Representation, enforce compliance with any Verification Covenant, verify any statements in any
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Officer’s Certificate delivered to it, or otherwise make calculations, investigations or determinations with respect to Derivative
Instruments, Net Shorts, Long Derivative Instruments, Short Derivative Instruments or otherwise. Neither the Trustee nor the
Collateral Agent shall have any liability to the Issuer, any holder or any other Person in acting in good faith on a Noteholder
Direction.
The Issuer is also required to deliver to the Trustee, within 30 days after an Officer becoming aware of any Default or
Event of Default (unless such Default or Event of Default has been cured or waived during such 30-day period), written notice of
such event and what action the Issuer is taking or proposes to take in respect thereof. The Trustee will not be deemed to have
knowledge of any Defaults or Events of Default unless written notice of an event, which is in fact a Default, has been delivered to
the Trustee pursuant to the notice provisions of this Indenture.
The term “Bankruptcy Law” means the Bankruptcy Code, or any similar Federal or state law for the relief of debtors.
The term “Custodian” means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
SECTION 6.02
Acceleration
. If an Event of Default (other than an Event of Default relating to certain events of bankruptcy, insolvency or
reorganization of the Issuer) occurs and is continuing, the Trustee by notice to the Issuer or the holders of at least 30% in
aggregate principal amount of outstanding Notes by notice to the Issuer, with a copy to the Trustee, may declare the principal of,
premium, if any, and accrued but unpaid interest on all the Notes to be due and payable. Upon such a declaration, such principal
and interest will be due and payable immediately. If an Event of Default relating to certain events of bankruptcy, insolvency or
reorganization of the Issuer occurs, the principal of, premium, if any, and interest on all the Notes will become immediately due
and payable without any declaration or other act on the part of the Trustee or any holders. Under certain circumstances, the
holders of a majority in principal amount of outstanding Notes may rescind any such acceleration with respect to the Notes and
its consequences.
In the event of any Event of Default specified in clause (5) of Section 6.01, such Event of Default and all consequences
thereof (excluding, however, any resulting payment default) will be annulled, waived and rescinded, automatically and without
any action by the Trustee or the holders of the Notes, if within 30 days after such Event of Default arose the Issuer delivers an
Officer’s Certificate to the Trustee stating that (x) the Indebtedness or guarantee that is the basis for such Event of Default has
been discharged or (y) the holders thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving
rise to such Event of Default or (z) the default that is the basis for such Event of Default has been cured, it being understood that
in no event shall an acceleration of the principal amount of the Notes as described above be annulled, waived or rescinded upon
the happening of any such events.
SECTION 6.03
Other Remedies
. If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy at law or in equity to
collect the payment of principal of or interest on the Notes or to enforce the performance of any provision of the Notes or this
Indenture.
The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in
the proceeding. A delay or omission by the Trustee or any holder in
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exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or
acquiescence in the Event of Default. No remedy is exclusive of any other remedy. To the extent required by law, all available
remedies are cumulative.
SECTION 6.04
Waiver of Past Defaults
. Provided the Notes are not then due and payable by reason of a declaration of acceleration, the holders of a majority
in aggregate principal amount of the then outstanding Notes by notice to the Trustee may, on behalf of the holders of all of the
Notes, waive, rescind or cancel any declaration of an existing or past Default or Event of Default and its consequences under this
Indenture if such waiver, rescission or cancellation would not conflict with any judgment or decree, except a continuing Default
or Event of Default in the payment of interest or premium on, or the principal of, the Notes (other than such nonpayment of
principal or interest that has become due as a result of such acceleration). Upon any such waiver, such Default shall cease to
exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.
SECTION 6.05
Control by Majority
. Subject to certain restrictions, the holders of a majority in principal amount of outstanding Notes are given the right
to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or the Collateral Agent
or of exercising any trust or power conferred on the Trustee or the Collateral Agent, as the case may be. The Trustee and the
Collateral Agent, as the case may be, however, may refuse to follow any direction that conflicts with Law or this Indenture or that
the Trustee or the Collateral Agent determines is unduly prejudicial to the rights of any other holder or that would involve the
Trustee or the Collateral Agent in personal liability (it being understood that neither the Trustee nor the Collateral Agent has a
duty to determine whether such actions are prejudicial to any holder). Prior to taking any action under this Indenture, the Trustee
and the Collateral Agent will be entitled to indemnification satisfactory to them in each of their sole discretion against all losses,
liabilities and expenses caused by taking or not taking such action.
SECTION 6.06
Limitation on Suits
.
In case an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the
rights or powers under this Indenture at the request or direction of any of the holders unless such holders have offered, and if
requested, provided to the Trustee indemnity or security satisfactory to the Trustee against any loss, liability or expense. Except
to enforce the right to receive payment of principal, premium (if any) or interest when due, no holder may pursue any remedy
with respect to this Indenture or the Notes (subject to the Intercreditor Agreements) unless:
(1)
(2)
such holder has previously given the Trustee written notice that an Event of Default is continuing,
holders of at least 30% in aggregate principal amount of the outstanding Notes have requested in writing the
Trustee to pursue the remedy,
(3)
such holders have offered, and if requested, provided the Trustee security or indemnity satisfactory to the
Trustee against any loss, liability or expense,
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(4)
the Trustee has not complied with such request within 60 days after the receipt of the request and the offer of
security or indemnity, and
(5)
the holders of a majority in principal amount of the outstanding Notes have not given the Trustee a direction
inconsistent with such written request within such 60-day period.
A holder may not use this Indenture to prejudice the rights of another holder or to obtain a preference or priority over another
holder.
SECTION 6.07
Contractual Rights of the Holders to Receive Payment
. Notwithstanding any other provision of this Indenture, the contractual right of any holder to receive payment of
principal of and interest on the Note held by such holder, on or after the respective due dates thereof, or to bring suit for the
enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such
holder.
SECTION 6.08
Collection Suit by Trustee
. If an Event of Default specified in Section 6.01(1) or (2) occurs and is continuing, the Trustee may recover judgment
in its own name and as trustee of an express trust against the Issuer or any other obligor on the Notes for the whole amount then
due and owing (together with interest on overdue principal and (to the extent lawful) on any unpaid interest at the rate provided
for in the Notes) and the amounts provided for in Section 7.07.
SECTION 6.09
Trustee May File Proofs of Claim
. The Trustee may file such proofs of claim, statements of interest and other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee (including any claim for reasonable compensation, expenses disbursements
and advances of the Trustee (including counsel, accountants, experts or such other professionals as the Trustee deems necessary,
advisable or appropriate)) and the holders allowed in any judicial proceedings relative to the Issuer, the Guarantors, their creditors
or their property, shall be entitled to participate as a member, voting or otherwise, of any official committee of creditors appointed
in such matters and, unless prohibited by law or applicable regulations, may vote on behalf of the holders in any election of a
trustee in bankruptcy or other Person performing similar functions, and any Custodian in any such judicial proceeding is hereby
authorized by each holder to make payments to the Trustee and, in the event that the Trustee shall consent to the making of such
payments directly to the holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under
Section 7.07. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on
behalf of any holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any
holder, or to authorize the Trustee to vote in respect of the claim of any holder in any such proceeding.
SECTION 6.10
Priorities
. Any money or property collected by the Trustee pursuant to this Article VI and any other money or property
distributable in respect of the Issuer’s or any Guarantor’s obligations under this Indenture after an Event of Default shall be
applied in the following order:
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FIRST: to the Trustee and the Collateral Agent, their agents and attorneys for amounts due hereunder;
SECOND: to the holders for amounts due and unpaid on the Notes for principal, premium, if any, and interest, ratably,
without preference or priority of any kind, according to the amounts due and payable on the Notes for principal and interest,
respectively; and
THIRD: to the Issuer or, to the extent the Trustee collects any amount for any Guarantor, to such Guarantor.
The Trustee may fix a record date and payment date for any payment to the holders pursuant to this Section 6.10. At
least 15 days before such record date, the Trustee shall mail to each holder and the Issuer a notice that states the record date, the
payment date and the amount to be paid.
SECTION 6.11
Undertaking for Costs
. In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any
action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an
undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable
attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or
defenses made by the party litigant. This Article VI does not apply to a suit by the Trustee, a suit by a holder pursuant to
Section 6.07 or a suit by holders of more than 10% in principal amount of the Notes.
SECTION 6.12
Waiver of Stay or Extension Laws
. Neither the Issuer nor any Guarantor (to the extent it may lawfully do so) shall at any time insist upon, or plead, or in
any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, which may affect the covenants or the performance of this Indenture; and the Issuer and the Guarantors (to the
extent that they may lawfully do so) hereby expressly waive all benefit or advantage of any such law, and shall not hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power
as though no such law had been enacted.
ARTICLE VII
TRUSTEE AND COLLATERAL AGENT
SECTION 7.01
Duties of Trustee and Collateral Agent
.
(1)
If an Event of Default has occurred and is continuing for which a Trust Officer has received written notice,
the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in its
exercise as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.
(2)
The Trustee, except during the continuance of an Event of Default and, at all times, the Collateral Agent:
(a)
undertakes to perform such duties and only such duties as are specifically set forth in this Indenture
and the Security Documents and no implied covenants or
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obligations shall be read into this Indenture, or the Security Documents against the Trustee and the Collateral Agent (it
being agreed that any discretionary or permissive right of the Trustee to do things enumerated in this Indenture shall not
be construed as a duty); and
(b)
in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee
and the Collateral Agent and conforming to the requirements of this Indenture and the Security Documents. Neither
the Trustee nor the Collateral Agent shall be under any duty to make any investigation as to any statement contained in
any such instance, but may accept the same as conclusive evidence of the truth and accuracy of such statement or the
correctness of such opinions. However, in the case of certificates or opinions required by any provision hereof to be
provided to it, the Trustee and the Collateral Agent shall examine the form of certificates and opinions to determine
whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(3)
Neither the Trustee nor the Collateral Agent may be relieved from liability for its own negligent
action, its own negligent failure to act (or, in the case of the Collateral Agent, grossly negligent action or its own grossly
negligent failure to act) or its own willful misconduct, except that:
(a)
this paragraph does not limit the effect of paragraph (2) of this Section 7.01;
(b)
neither the Trustee nor the Collateral Agent shall be liable for any error of judgment made in good
faith by a Trust Officer unless it is proved that the Trustee or the Collateral Agent was negligent (or, in the case of the
Collateral Agent, grossly negligent) in ascertaining the pertinent facts;
(c)
the Trustee and the Collateral Agent shall not be liable with respect to any action it takes or omits to
take in good faith in accordance with a direction received by it pursuant to Section 6.05 herein; and
(d)
no provision of this Indenture or the Security Documents shall require the Trustee or the Collateral
Agent to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity and/or security against such risk or liability is not reasonably assured to
it.
(4)
Every provision of this Indenture that in any way relates to the Trustee and the Collateral Agent is subject to
paragraphs (1), (2) and (3) of this Section 7.01.
(5)
Neither the Trustee nor the Collateral Agent shall be liable for interest on any money received by it except as
the Trustee and the Collateral Agent may agree in writing with the Issuer.
(6)
Money held in trust by the Trustee or the Collateral Agent need not be segregated from other funds except to
the extent required by law.
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(7)
Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to
the Trustee and the Collateral Agent shall be subject to the provisions of this Section 7.01.
SECTION 7.02
Rights of Trustee and Collateral Agent
.
(1)
The Trustee and the Collateral Agent may conclusively rely on any document believed by it to be genuine
and to have been signed or presented by the proper Person. The Trustee and the Collateral Agent need not investigate any fact or
matter stated in the document.
(2)
Before the Trustee or the Collateral Agent acts or refrains from acting, it may require an Officer’s Certificate
or an Opinion of Counsel or both, except that (x) no Officer’s Certificate or Opinion of Counsel will be required to be furnished
to the Trustee or the Collateral Agent in connection with the authentication and delivery of the Initial Notes on the Issue Date and
(y) no Opinion of Counsel will be required to be furnished to the Trustee or the Collateral Agent in connection with the execution
of any indenture supplement in the form of Exhibit C to add a new Guarantor under this Indenture. Neither the Trustee nor the
Collateral Agent shall be liable for any action it takes or omits to take in good faith in reliance on the Officer’s Certificate or
Opinion of Counsel.
(3)
Each of the Trustee and the Collateral Agent may act through its agents and attorneys and shall not be
responsible for the misconduct or negligence of any agent or attorney appointed with due care.
(4)
Neither the Trustee nor the Collateral Agent shall be responsible or liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its rights or powers conferred upon it by this Indenture; provided,
however, that the Trustee’s or the Collateral Agent’s conduct does not constitute willful misconduct or negligence (or, in the case
of the Collateral Agent, gross negligence).
(5)
Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the
Issuer will be sufficient if signed by an Officer of the Issuer.
(6)
Each of the Trustee and the Collateral Agent may consult with counsel of its own selection and the advice or
opinion of counsel with respect to legal matters relating to this Indenture, the Notes, the Security Documents and the Intercreditor
Agreements shall be full and complete authorization and protection from liability in respect of any action taken, omitted or
suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.
(7)
The Trustee and the Collateral Agent shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, judgment, approval,
bond, debenture, note or other paper or document unless requested in writing to do so by the holders of not less than a majority in
principal amount of the Notes at the time outstanding, but each of the Trustee and the Collateral Agent, in its discretion, may
make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee or the Collateral Agent
shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of
the Issuer,
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personally or by agent or attorney, at the expense of the Issuer and shall Incur no liability of any kind by reason of such inquiry or
investigation.
(8)
Neither the Trustee nor the Collateral Agent shall be under any obligation to exercise any of the rights or
powers vested in it by this Indenture, the Intercreditor Agreements or the Security Documents at the request or direction of any of
the holders pursuant to this Indenture, the Intercreditor Agreements or the Security Documents, unless such holders shall have
offered, and if requested, provided to the Trustee or the Collateral Agent security or indemnity satisfactory to the Trustee or the
Collateral Agent, as applicable, against the costs, expenses and liabilities which might be incurred by it in compliance with such
request or direction.
(9)
The rights, privileges, protections, immunities and benefits given to the Trustee or the Collateral Agent,
including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee or the
Collateral Agent in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder.
(10)
Neither the Trustee nor the Collateral Agent shall be responsible or liable for any action taken or omitted to
be taken by it in good faith in accordance with the direction of the holders of not less than a majority of the aggregate principal
amount of any series of the Notes at the time outstanding determined as provided in Section 6.05 as to the time, method and place
of conducting any proceedings for any remedy available to the Trustee or the Collateral Agent or exercising of any trust or power
conferred upon the Trustee and Collateral Agent under this Indenture, the Intercreditor Agreements or the Security Documents, as
applicable.
(11)
Any action taken, or omitted to be taken, by the Trustee or the Collateral Agent in good faith pursuant to
this Indenture, the Intercreditor Agreements or the Security Documents upon the request or authority or consent of any person
who, at the time of making such request or giving such authority or consent, is the holder of any Note shall be conclusive and
binding upon future holders of Notes and upon Notes executed and delivered in exchange therefor or in place thereof.
(12)
Neither the Trustee nor the Collateral Agent shall be deemed to have notice of any Default or Event of
Default unless a Trust Officer of the Trustee or Collateral Agent, as applicable, has received written notice of any event which is
in fact such a Default at the Corporate Trust Office, and such notice references the Notes and this Indenture.
(13)
The Trustee or the Collateral Agent may request that the Issuer deliver an Officer’s Certificate setting forth
the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, the
Intercreditor Agreements or the Security Documents, which Officer’s Certificate may be signed by any Person authorized to sign
an Officer’s Certificate, including any Person specified as so authorized in any such certificate previously delivered and not
superseded.
(14)
Neither the Trustee nor the Collateral Agent shall be responsible or liable for punitive, special, indirect,
incidental or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of
whether the Trustee or the Collateral
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Agent has been advised of the likelihood of such loss or damage and regardless of the form of actions.
Neither the Trustee nor the Collateral Agent shall be required to give any bond or surety in respect of the
execution or performance of the trusts and powers under this Indenture, the Intercreditor Agreements or the Security Documents.
(15)
(16)
Neither the Trustee nor the Collateral Agent shall be responsible or liable for any failure or delay in the
performance of its obligations under this Indenture, the Intercreditor Agreements or the Security Documents arising out of or
caused, directly or indirectly, by forces beyond its control, including, without limitation, strikes; work stoppages; acts of God;
earthquakes; fire; flood; storms, hurricanes or other natural catastrophes and interruptions; nuclear catastrophe; terrorism; acts of
war; civil or military disturbances; sabotage; epidemics; pandemics; riots; interruptions, loss or malfunction of utilities, computer
(hardware or software) or communication services or unavailability of Federal Reserve Bank wire or telex or other wire
communication facilities; accidents; labor disputes; and acts of civil or military authorities and governmental action.
(17)
Any discretion, permissive right or privilege of the Trustee or the Collateral Agent to take the actions
permitted by this Indenture shall not be construed as an obligation to do so.
SECTION 7.03
Individual Rights of Trustee
. The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise
deal with the Issuer or its Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent or Registrar may
do the same with like rights.
SECTION 7.04
Trustee’s and Collateral Agent’s Disclaimer
. Neither the Trustee nor the Collateral Agent shall be responsible for and neither the Trustee nor the Collateral Agent
makes any representation as to the validity or adequacy of this Indenture, the Guarantees, the Notes, the Intercreditor Agreements
or the Security Documents, neither shall be accountable for the Issuer’s use of the proceeds from the Notes, the Issuer’s
discretion under any provision of this Indenture and neither shall be responsible for any statement of the Issuer or any Guarantor
in this Indenture or in any document issued in connection with the sale of the Notes or in the Notes other than the Trustee’s
certificate of authentication. In accepting the trust hereby created, the Trustee acts solely as Trustee under this Indenture and not
in its individual capacity and all persons, including without limitation the holders of Notes and the Issuer having any claim
against the Trustee arising from this Indenture shall look only to the funds and accounts held by the Trustee hereunder for
payment except as otherwise provided herein.
SECTION 7.05
Notice of Default
. If a Default occurs and is continuing in which written notice thereof is received by a Trust Officer of the Trustee at
the Corporate Trust Office and such notice references the Notes and this Indenture, the Trustee shall mail, or deliver
electronically if held by the Depository, to each holder of the Notes notice of the Default within the later of 90 days after it occurs
or 30 days after written notice of it is received by the Trust Officer of the Trustee (unless such Default is cured or waived within
such time period). Except in the case of a Default in the payment of principal of, premium (if any) or interest on any Note, the
Trustee may withhold
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notice if and so long as it in good faith determines that withholding notice is in the interests of the noteholders.
SECTION 7.06
[Intentionally Omitted]
.
SECTION 7.07
Compensation and Indemnity
. The Issuer shall pay to the Trustee and the Collateral Agent from time to time compensation as is agreed to from time
to time by the Issuer, the Trustee and the Collateral Agent in writing for the Trustee’s and the Collateral Agent’s acceptance of
this Indenture and its services hereunder. Neither the Trustee’s nor the Collateral Agent’s compensation shall be limited by any
law on compensation of a trustee of an express trust. The Issuer promptly shall reimburse each of the Trustee and the Collateral
Agent upon request for all reasonable out-of-pocket expenses Incurred or made by it, including costs of collection, in addition to
the compensation for its services. Such expenses shall include the reasonable out-of-pocket compensation and expenses,
disbursements and advances of the Trustee’s and the Collateral Agent’s agents, counsel, accountants and experts. The Issuer and
the Guarantors, jointly and severally, shall indemnify each of the Trustee or any predecessor Trustee, the Collateral Agent or any
predecessor Collateral Agent and their respective directors, officers, employees and agents against any and all loss, liability,
claim, damage or expense (including reasonable attorneys’ fees and expenses and including taxes (other than taxes based upon,
measured by or determined by the income of the Trustee or the Collateral Agent)) incurred by or in connection with the
acceptance or administration of this trust and the performance of its duties hereunder and under the Security Documents and
Intercreditor Agreements, including the reasonable costs and expenses of enforcing this Indenture, Guarantee, the Intercreditor
Agreements or the Security Documents against the Issuer or any Guarantor (including this Section 7.07) and defending itself
against or investigating any claim (whether asserted by the Issuer, any Guarantor, any holder or any other Person). Each of the
Trustee and the Collateral Agent shall notify the Issuer of any claim for which it may seek indemnity promptly upon obtaining
actual knowledge or written notice thereof; provided, however, that any failure so to notify the Issuer shall not relieve the Issuer
or any Guarantor of its indemnity obligations hereunder. The Issuer may defend the claim and the indemnified party shall
provide reasonable cooperation at the Issuer’s expense in the defense. Such indemnified parties may have separate counsel and
the Issuer and such Guarantor, as applicable, shall pay the fees and expenses of such counsel; provided, however, that the Issuer
shall not be required to pay such fees and expenses if it assumes such indemnified parties’ defense and, in such indemnified
parties’ reasonable judgment, there is no actual or potential conflict of interest between the Issuer and the Guarantors, as
applicable, and such parties in connection with such defense. Neither the Issuer nor any Guarantor needs to pay for any
settlement made without its consent, which consent will not be unreasonably withheld. The Issuer need not reimburse any
compensation and expense or indemnify against any loss, liability, claim, damage or expense Incurred by an indemnified party
through such party’s own willful misconduct or gross negligence.
To secure the Issuer’s and the Guarantors’ payment obligations in this Section 7.07, the Trustee and the Collateral
Agent shall have a Lien prior to the Notes on all money or property held or collected by the Trustee and the Collateral Agent
other than money or property held in trust to pay principal of and interest on particular Notes.
The Issuer’s and the Guarantors’ payment obligations pursuant to this Section 7.07 shall survive the satisfaction or
discharge of this Indenture, the Intercreditor Agreements and the
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Security Documents, any rejection or termination of this Indenture under any Bankruptcy Law or the resignation or removal of
the Trustee or the Collateral Agent. Without prejudice to any other rights available to the Trustee or the Collateral Agent under
applicable law, when the Trustee or the Collateral Agent incurs expenses after the occurrence of an Event of Default specified in
Section 6.01(6) or (7) with respect to the Issuer, the expenses are intended to constitute expenses of administration under the
Bankruptcy Law.
No provision of this Indenture shall require the Trustee or the Collateral Agent to expend or risk its own funds or
otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or
powers, if repayment of such funds or adequate indemnity against such risk or liability is not assured to its reasonable
satisfaction.
SECTION 7.08
Replacement of Trustee or Collateral Agent
.
(1)
The Trustee or the Collateral Agent may resign at any time upon 30 days advance written notice to the
Issuer. The holders of a majority in aggregate principal amount of the then outstanding Notes may remove the Trustee or the
Collateral Agent by so notifying the Trustee or Collateral Agent, as applicable, and the Issuer upon 30 days advance written
notice and may appoint a successor Trustee or Collateral Agent, as applicable. The Issuer shall remove the Trustee or the
Collateral Agent if:
(a)
(b)
in the case of the Trustee, the Trustee fails to comply with Section 7.10;
the Trustee or the Collateral Agent is adjudged bankrupt or insolvent or an order for relief is entered
with respect to the Trustee or the Collateral Agent under any Bankruptcy Law;
(c)
a receiver or other public officer takes charge of the Trustee or the Collateral Agent, as applicable,
or its property; or
(d)
the Trustee or the Collateral Agent otherwise becomes incapable of acting.
(2)
If the Trustee or the Collateral Agent resigns, is removed by the Issuer or by the holders of a majority in
aggregate principal amount of the then outstanding Notes and such holders do not reasonably promptly appoint a successor
Trustee or successor Collateral Agent, if applicable, or if a vacancy exists in the office of Trustee for any reason (the Trustee in
such event being referred to herein as the retiring Trustee) or Collateral Agent (the Collateral Agent in such event being referred
to herein as the retiring Collateral Agent) for any reason, the Issuer shall promptly appoint a successor Trustee or successor
Collateral Agent, as applicable.
(3)
A successor Trustee or successor Collateral Agent shall deliver a written acceptance of its appointment to the
retiring Trustee or retiring Collateral Agent, as applicable, and to the Issuer. Thereupon the resignation or removal of the retiring
Trustee or retiring Collateral Agent, as applicable, shall become effective, and the successor Trustee or successor Collateral
Agent, as applicable, shall have all the rights, powers and duties of the Trustee or Collateral Agent under this Indenture. The
successor Trustee or successor Collateral Agent shall send a notice of its succession to the holders. The retiring Trustee or the
retiring Collateral Agent, as applicable, shall
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promptly transfer all property held by it as Trustee or Collateral Agent to the successor Trustee or successor Collateral Agent, as
applicable, subject to the Lien provided for in Section 7.07.
(4)
If a successor Trustee or successor Collateral Agent does not take office within 60 days after the retiring
Trustee or retiring Collateral Agent resigns or is removed, the retiring Trustee or retiring Collateral Agent, as applicable, the
Issuer or the holders of at least 10% in aggregate principal amount of the then outstanding Notes may petition at the expense of
the Issuer any court of competent jurisdiction for the appointment of a successor Trustee or successor Collateral Agent.
(5)
If the Trustee fails to comply with Section 7.10, any holder who has been a bona fide holder of a Note for at
least six months may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
(6)
Notwithstanding the replacement of the Trustee or the Collateral Agent pursuant to this Section 7.08, the
Issuer’s obligations under Section 7.07 shall continue for the benefit of the retiring Trustee or retiring Collateral Agent.
SECTION 7.09
Successor by Merger
. If the Trustee or the Collateral Agent consolidates with, merges or converts into, or transfers all or substantially all its
corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation
or banking association without any further act shall be the successor Trustee or successor Collateral Agent, as applicable;
provided such successor shall be otherwise qualified and eligible under Section 7.10.
In case at the time such successor or successors by merger, conversion or consolidation to the Trustee shall succeed to
the trusts created by this Indenture, any of the Notes shall have been authenticated but not delivered, any such successor to the
Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Notes so authenticated; and in
case at that time any of the Notes shall not have been authenticated, any successor to the Trustee may authenticate such Notes
either in the name of any predecessor hereunder or in the name of the successor to the Trustee; and in all such cases such
certificates shall have the full force which it is anywhere in the Notes or in this Indenture provided that the certificate of the
Trustee shall have.
SECTION 7.10
Eligibility; Disqualification
. There will at all times be a Trustee hereunder that is a corporation or national banking association organized and
doing business under the laws of the United States or of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and
surplus of at least $50,000,000 as set forth in its most recent published annual report of condition.
ARTICLE VIII
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01
Discharge of Liability on Notes; Defeasance
.
(1)
This Indenture, the Security Documents and the Intercreditor Agreements (with respect to the Notes) shall be
discharged and shall cease to be of further effect (except as to
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surviving rights, benefits, protections, indemnities and immunities of the Trustee and the Collateral Agent and the rights of
registration or transfer or exchange of Notes, as expressly provided for in this Indenture) as to all outstanding Notes when:
(a)
either (A) all the Notes theretofore authenticated and delivered (except lost, stolen or destroyed
Notes which have been replaced or paid and Notes for whose payment money has theretofore been deposited in trust or
segregated and held in trust by or on behalf of the Issuer and thereafter repaid to the Issuer or discharged from such
trust) have been delivered to the Trustee for cancellation or (B) all of the Notes not delivered to the Trustee for
cancellation (1) have become due and payable, (2) will become due and payable at their Stated Maturity within one
year or (3) if redeemable at the option of the Issuer, are to be called for redemption within one year under arrangements
satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the
Issuer, and the Issuer has irrevocably deposited or caused to be deposited with the Trustee funds in an amount sufficient
to pay and discharge the entire Indebtedness on the Notes not theretofore delivered to the Trustee for cancellation, for
principal of, premium, if any, and interest on the Notes to the date of deposit (in the case of Notes that have become due
and payable) or to the date of maturity or redemption, as applicable, together with irrevocable instructions from the
Issuer directing the Trustee to apply such funds to the payment thereof at maturity or redemption, as the case may be;
provided that upon any redemption that requires the payment of the Applicable Premium, the amount deposited shall be
sufficient for purposes of this Indenture to the extent that an amount is deposited with the Trustee equal to the
Applicable Premium calculated as of the date of the notice of redemption, with any deficit as of the date of the
redemption only required to be deposited with the Trustee on or prior to the date of the redemption;
(b)
the Issuer and/or the Guarantors have paid all other sums due and payable under this Indenture; and
(c)
the Issuer has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel stating
that all conditions precedent under this Indenture relating to the satisfaction and discharge of this Indenture have been
complied with.
(2)
Subject to Sections 8.01(3) and 8.02, the Issuer at any time may terminate (i) all of its obligations under the
Notes and this Indenture with respect to the holders of the Notes (“legal defeasance option”), and (ii) its obligations under
Sections 4.02, 4.03, 4.04, 4.05, 4.06, 4.07, 4.08, 4.09, 4.11, 4.12, 4.14 and 4.15 and the operation of Section 5.01 and covenants
in Article XIII of this Indenture and the Security Documents for the benefit of the holders of the Notes, and Sections 6.01(3),
6.01(4), 6.01(5), 6.01(6), 6.01(7) (in the case of Sections 6.01(6) and 6.01(7) with respect to Significant Subsidiaries only),
6.01(8), 6.01(9), 6.01(10) or 6.01(11) (“covenant defeasance option”). The Issuer may exercise its legal defeasance option
notwithstanding its prior exercise of its covenant defeasance option. In the event that the Issuer terminates all of its obligations
under the Notes and this Indenture (with respect to such Notes) by exercising its legal defeasance option or its covenant
defeasance option, the Liens as they pertain to the Notes and Guarantees, will be released and the obligations of each Guarantor
with respect to its Guarantee and, to the extent pertaining to the Notes and Guarantees, the Security Documents and the
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Intercreditor Agreements, shall be terminated simultaneously with the termination of such obligations.
If the Issuer exercises its legal defeasance option, payment of the Notes so defeased may not be accelerated because of
an Event of Default. If the Issuer exercises its covenant defeasance option, payment of the Notes so defeased may not be
accelerated because of an Event of Default specified in Sections 6.01(3), 6.01(4), 6.01(5), 6.01(6), 6.01(7) (in the case of
Sections 6.01(6) and (7), with respect to Significant Subsidiaries only), 6.01(8), 6.01(9), 6.01(10) or 6.01(11) or because of the
failure of the Issuer and the Guarantors to comply with Section 5.01 or the covenants in Article XIII of this Indenture and the
Security Documents.
Upon satisfaction of the conditions set forth herein and upon request of the Issuer, the Trustee shall acknowledge in
writing the discharge of those obligations that the Issuer terminated.
(3)
Notwithstanding clauses (1) and (2) of this Section 8.01, the Issuer’s obligations in Sections 2.04, 2.05, 2.06,
2.07, 2.08 and 2.09 and Article VII, including, without limitation, Sections 7.07 and 7.08 and in this Article VIII and the rights
and immunities of the Trustee and the Collateral Agent under this Indenture shall survive until the Notes have been paid in
full. Thereafter, the Issuer’s obligations in Sections 7.07, 7.08, 8.05 and 8.06 and the rights and immunities of the Trustee and the
Collateral Agent under this Indenture shall survive such satisfaction and discharge.
SECTION 8.02
Conditions to Defeasance
.
(1)
The Issuer may exercise its legal defeasance option or its covenant defeasance option only if:
(a)
the Issuer irrevocably deposits in trust with the Trustee cash in U.S. dollars, U.S. Government
Obligations or a combination thereof in an amount that is sufficient to pay the principal of and premium (if any) and
interest on the Notes when due at maturity or redemption, as the case may be;
(b)
the Issuer delivers to the Trustee a certificate from a nationally recognized firm of independent
accountants expressing their opinion that the payments of principal and interest when due and without reinvestment on
the deposited U.S. Government Obligations plus any deposited money without investment will provide cash at such
times and in such amounts as will be sufficient to pay principal, premium, if any, and interest when due on all the Notes
to maturity or redemption, as the case may be;
(c)
no Default specified in Section 6.01(6) or (7) with respect to the Issuer shall have occurred or is
continuing on the date of such deposit;
(d)
the deposit does not constitute a default under any other material agreement or instrument binding
on the Issuer;
(e)
in the case of the legal defeasance option, the Issuer shall have delivered to the Trustee an Opinion
of Counsel stating that (1) the Issuer has received from, or there has been published by, the Internal Revenue Service a
ruling, or (2) since the date of this
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Indenture there has been a change in the applicable U.S. federal income tax law, in either case to the effect that, and
based thereon such Opinion of Counsel shall confirm that, the beneficial owners of the Notes will not recognize
income, gain or loss for U.S. federal income tax purposes as a result of such deposit and defeasance and will be subject
to U.S. federal income tax on the same amounts and in the same manner and at the same times as would have been the
case if such deposit and defeasance had not occurred; provided that upon any redemption that requires the payment of
the Applicable Premium, the amount deposited shall be sufficient for purposes of this Indenture to the extent that an
amount is deposited with the Trustee equal to the Applicable Premium calculated as of the date of the notice of
redemption, with any deficit as of the date of the redemption only required to be deposited with the Trustee on or prior
to the date of the redemption. Notwithstanding the foregoing, the Opinion of Counsel required by the immediately
preceding sentence with respect to a legal defeasance need not be delivered if all of the Notes not theretofore delivered
to the Trustee for cancellation (x) have become due and payable or (y) will become due and payable at their Stated
Maturity within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense, of the Issuer;
(f)
such exercise does not impair the contractual right of any holder to receive payment of principal of,
premium, if any, and interest on such holder’s Notes on or after the due dates therefor or to institute suit for the
enforcement of any payment on or with respect to such holder’s Notes;
(g)
in the case of the covenant defeasance option, the Issuer shall have delivered to the Trustee an
Opinion of Counsel to the effect that the beneficial owners of the Notes will not recognize income, gain or loss for U.S.
federal income tax purposes as a result of such deposit and defeasance and will be subject to U.S. federal income tax on
the same amounts, in the same manner and at the same times as would have been the case if such deposit and
defeasance had not occurred; provided that upon any redemption that requires the payment of the Applicable Premium,
the amount deposited shall be sufficient for purposes of this Indenture to the extent that an amount is deposited with the
Trustee equal to the Applicable Premium calculated as of the date of the notice of redemption, with any deficit as of the
date of the redemption only required to be deposited with the Trustee on or prior to the date of the
redemption. Notwithstanding the foregoing, the Opinion of Counsel required by the immediately preceding sentence
with respect to a legal defeasance need not be delivered if all of the Notes not theretofore delivered to the Trustee for
cancellation (x) have become due and payable or (y) will become due and payable at their Stated Maturity within one
year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name,
and at the expense, of the Issuer; and
(h)
the Issuer delivers to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating
that all conditions precedent to the defeasance and discharge of the Notes to be so defeased and discharged as
contemplated by this Article VIII have been complied with.
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(2)
Before or after a deposit, the Issuer may make arrangements satisfactory to the Trustee for the redemption of
such Notes at a future date in accordance with Article III.
SECTION 8.03
Application of Trust Money
. The Trustee shall hold in trust money or U.S. Government Obligations (including proceeds thereof) deposited with it
pursuant to this Article VIII. The Trustee shall apply the deposited money and the money from U.S. Government Obligations
through each Paying Agent and in accordance with this Indenture to the payment of principal of and interest on the Notes so
discharged or defeased.
SECTION 8.04
Repayment to Issuer
. Each of the Trustee and each Paying Agent shall promptly turn over to the Issuer upon request any money or U.S.
Government Obligations held by it as provided in this Article VIII that, in the written opinion of a nationally recognized firm of
independent public accountants delivered to the Trustee (which delivery shall only be required if U.S. Government Obligations
have been so deposited), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent
discharge or defeasance in accordance with this Article VIII.
Subject to any applicable abandoned property law, the Trustee and each Paying Agent shall pay to the Issuer upon
written request any money held by them for the payment of principal or interest that remains unclaimed for two years, and,
thereafter, holders entitled to the money must look to the Issuer for payment as general creditors, and the Trustee and each Paying
Agent shall have no further liability with respect to such monies.
SECTION 8.05
Indemnity for U.S. Government Obligations
. The Issuer shall pay and shall indemnify the Trustee against any tax, fee or other charge imposed on or assessed
against deposited U.S. Government Obligations or the principal and interest received on such U.S. Government Obligations.
SECTION 8.06
Reinstatement
. If the Trustee or any Paying Agent is unable to apply any money or U.S. Government Obligations in accordance with
this Article VIII by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority
enjoining, restraining or otherwise prohibiting such application, the Issuer’s obligations under this Indenture and the Notes so
discharged or defeased shall be revived and reinstated as though no deposit had occurred pursuant to this Article VIII until such
time as the Trustee or any Paying Agent is permitted to apply all such money or U.S. Government Obligations in accordance with
this Article VIII; provided, however, that, if the Issuer has made any payment of principal of, or interest on, any such Notes
because of the reinstatement of its obligations, the Issuer shall be subrogated to the rights of the holders of such Notes to receive
such payment from the money or U.S. Government Obligations held by the Trustee or any Paying Agent.
ARTICLE IX
AMENDMENTS AND WAIVERS
SECTION 9.01
Without Consent of the Holders
.
The Issuer, the Trustee and, if applicable, the Collateral Agent may amend this Indenture, the Notes, the Guarantees,
the Security Documents, the Intercreditor Agreements and the Escrow Agreement without notice to or the consent of any holder:
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(1)
to cure any ambiguity, omission, mistake, defect or inconsistency;
(2)
to provide for the assumption by a Successor Company (with respect to the Issuer) of the obligations of the
Issuer under this Indenture, the Notes, the Security Documents and the Intercreditor Agreements (including an assumption of the
Escrow Issuer’s obligations pursuant to the Merger);
(3)
to provide for the assumption by a Successor Subsidiary Guarantor (with respect to any Subsidiary
Guarantor), as the case may be, of the obligations of a Subsidiary Guarantor under this Indenture, its Guarantee, the Security
Documents and the Intercreditor Agreements;
(4)
to provide for uncertificated Notes in addition to or in place of certificated Notes (provided that the
uncertificated Notes are issued in registered form for purposes of Section 163(f) of the Code, or in a manner such that the
uncertificated Notes are described in Section 163(f)(2)(B) of the Code);
(5)
to add a Guarantee with respect to the Notes;
(6)
to make, complete or confirm any grant of Collateral permitted or required by this Indenture or any of the
Security Documents or Intercreditor Agreements, or any release of Collateral pursuant to the terms of this Indenture or any of the
Security Documents or Intercreditor Agreements;
(7)
to add to the covenants of the Issuer for the benefit of the holders or to surrender any right or power
conferred upon the Issuer or any Restricted Subsidiary;
(8)
to make any change that would provide any additional rights or benefits to the holders or that does not
adversely affect the rights of any holder in any material respect (as determined by in good faith by the Issuer);
(9)
to conform the text of this Indenture, Guarantees, the Notes the Security Documents, the Intercreditor
Agreements or the Escrow Agreement to any provision of the “Description of Notes” in the Offering Memorandum to the extent
that such provision in the “Description of Notes” in the Offering Memorandum was intended by the Issuer to be a verbatim
recitation of a provision of this Indenture, Guarantees, the Notes the Security Documents, the Intercreditor Agreements or the
Escrow Agreement, as applicable, as stated in an Officer’s Certificate;
(10)
to comply with any requirement of the SEC in connection with the qualification of this Indenture under the
TIA (if the Issuer elects to qualify this Indenture under the TIA);
(11)
to make changes to provide for the issuance of Additional Notes;
(12)
to add provisions to this Indenture and a new form of Note to permit the issuance by the Issuer or its
Subsidiary of escrow Notes under this Indenture, which may have different terms than other Notes issued under this Indenture so
long as the proceeds of such Notes remain in escrow (including, but not limited to, separate collateral, different or no guarantees
and special mandatory redemption provisions);
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(13)
to secure additional extensions of credit and add additional secured creditors holding other Parity Lien
Indebtedness so long as such Parity Lien Indebtedness is not prohibited by the provisions of this Indenture or any other then-
existing Parity Lien Indebtedness; or
(14)
to add additional assets as Collateral.
SECTION 9.02
With Consent of the Holders
. The Issuer and the Trustee may amend this Indenture, the Notes, the Guarantees, the Security Documents, the
Intercreditor Agreements and the Escrow Agreement with the consent of the Issuer and the holders of at least a majority in
principal amount of the Notes then outstanding and any past default or compliance with any provisions hereof may be waived
with the consent of the holders of at least a majority in principal amount of the Notes then outstanding (in each case, including
consents obtained in connection with a tender offer or exchange for the Notes). However, without the consent of each holder of
an outstanding Note affected, an amendment may not:
(1)
amendment;
(2)
(3)
reduce the percentage of the aggregate principal amount of Notes whose holders must consent to an
reduce the rate of or extend the time for payment of interest on any Note;
reduce the principal of or change the Stated Maturity of any Note;
(4)
reduce the premium payable upon the redemption of any Note or change the dates on which any such Note
may be redeemed as described under Article III herein (other than any change to the notice periods with respect to such
redemption);
(5)
(6)
make any Note payable in money other than that stated in such Note;
make any change to, or modify, the ranking of the Notes or the Guarantees in respect of right of payment in a
manner that would adversely affect the holders of the Notes;
(7)
impair the contractual right of any holder to receive payment of principal of, premium, if any, and interest on
such holder’s Note on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to
such holder’s Note; or
(8)
make any change in the amendment provisions or in the waiver provisions which require each holder’s
consent; or
(9)
waive or modify in a manner materially adverse to the interests of the holders of the notes the provisions
relating to the Escrow Issuer’s obligation to redeem the notes in a Special Mandatory Redemption.
In addition, without the consent of the holders of at least 66⅔% in aggregate principal amount of the Notes then
outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer
for, the Notes), no amendment, supplement or waiver may (1) have the effect of releasing all or substantially all of the Collateral
from the Liens of the Security Documents (except as permitted by the terms of this Indenture, the Security Documents or the
Intercreditor Agreements) or changing or altering the priority of the
144
security interests of the holders of the Notes in the Collateral under the ABL Intercreditor Agreement or the Pari Passu
Intercreditor Agreement, (2) make any change in the Security Documents, the Intercreditor Agreements or the provisions in this
Indenture dealing with the application of proceeds of the Collateral that would adversely affect the holders of the Notes or
(3) modify the Security Documents or the provisions of this Indenture dealing with Collateral in any manner adverse to the
holders of the Notes in any material respect other than in accordance with the terms of this Indenture, the Security Documents or
the Intercreditor Agreements; provided that (x) if any such amendment, supplement or waiver will only affect one series of notes
(or less than all series of notes) then outstanding under this Indenture, then only the consent of the holders of at least 66⅔% in
aggregate principal amount of the Notes of such series then outstanding (including, without limitation, consents obtained in
connection with a purchase of, or tender offer or exchange offer for, such series of the Notes) shall be required.
The consent of the noteholders is not necessary under this Indenture to approve the particular form of any proposed
amendment. It is sufficient if such consent approves the substance of the proposed amendment.
In addition, the holders will be deemed to have consented for purposes of this Indenture, the Security Documents and
the Intercreditor Agreements (and, if applicable, the Junior Lien Intercreditor Agreement) to any of the following amendments
and other modifications to this Indenture, the Security Documents or the Intercreditor Agreements (or, if applicable, the Junior
Lien Intercreditor Agreement) and the entry into a Junior Lien Intercreditor Agreement:
(1)
(a) to add other parties (or any authorized agent thereof or trustee therefor) holding Parity Lien Indebtedness
that is incurred in compliance with the ABL Credit Agreement, the Term Loan Credit Agreement, this Indenture, the Security
Documents and the Intercreditor Agreements and (b) to establish that the Liens on any Collateral securing such Parity Lien
Indebtedness shall be pari passu under the Pari Passu Intercreditor Agreement with the Liens on such Collateral securing the
Obligations under this Indenture, the Notes and the Guarantees, all on the terms provided for in the Pari Passu Intercreditor
Agreement in effect immediately prior to such amendment or other modification;
(2)
to establish that the Liens on any Collateral securing any Indebtedness replacing the Term Loan Credit
Agreement permitted to be incurred under this Indenture shall be pari passu to the Liens on such Collateral securing any
Obligations under this Indenture, the Notes and the Guarantees, all on the terms provided for in the Pari Passu Intercreditor
Agreement in effect immediately prior to such amendment or other modification;
(3)
to establish that the Liens on any Current Asset Collateral securing any Indebtedness replacing the ABL
Credit Agreement permitted to be incurred under this Indenture shall be senior to the Liens on such Current Asset Collateral
securing any Obligations under this Indenture, the Notes and the Guarantees, and that the Liens on any Fixed Asset Collateral
securing any such Indebtedness shall be junior to the Liens on such Fixed Asset Collateral securing any Obligations under this
Indenture, the Notes and the Guarantees, all on the terms provided for in the ABL Intercreditor Agreement in effect immediately
prior to such amendment and other modification;
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(4)
upon any cancellation or termination of the ABL Credit Agreement without a replacement thereof, to
establish that the Current Asset Collateral (in addition to the Fixed Asset Collateral) shall secure the Obligations under this
Indenture, the Notes and the Guarantees on a first-priority basis, subject to the terms of the Pari Passu Intercreditor Agreement in
effect immediately prior to such amendment or other modification; and
(5)
to secure additional extensions of credit and add additional secured creditors holding Indebtedness secured
on a contractually junior basis on the Collateral to the Notes so long as such Indebtedness is not prohibited by the provisions of
this Indenture and to enter into or amend the Junior Lien Intercreditor Agreement.
No Opinion of Counsel will be required for the Trustee or Collateral Agent to execute any amendment or supplement
entered into in connection with adding a Guarantor or adding Collateral; provided, that the Trustee shall be entitled to
conclusively rely on an Officer’s Certificate in executing such amendment or supplement or delivering such release.
For the avoidance of doubt, no amendment, waiver, modification or deletion of the provisions described under any of
the covenants described under Article IV shall be deemed to impair or affect any rights of holders of the Notes to institute suit for
the enforcement of any payment on or with respect to, or to receive payment of principal of, or premium, if any, or interest on, the
Notes.
SECTION 9.03
Revocation and Effect of Consents and Waivers
.
(1)
A consent to an amendment or a waiver by a holder of a Note shall bind the holder and every subsequent
holder of that Note or portion of the Note that evidences the same debt as the consenting holder’s Note, even if notation of the
consent or waiver is not made on the Note. However, any such holder or subsequent holder may revoke the consent or waiver as
to such holder’s Note or portion of the Note if the Trustee receives the notice of revocation before the date on which the Trustee
receives an Officer’s Certificate from the Issuer certifying that the requisite principal amount of Notes have consented. After an
amendment or waiver becomes effective, it shall bind every holder. An amendment or waiver becomes effective upon the
(i) receipt by the Issuer or the Trustee of consents by the holders of the requisite principal amount of securities, (ii) satisfaction of
conditions to effectiveness as set forth in this Indenture and any indenture supplemental hereto containing such amendment or
waiver and (iii) execution of such amendment or waiver (or supplemental indenture) by the Issuer, the Guarantors and the
Trustee.
(2)
The Issuer may, but shall not be obligated to, fix a record date for the purpose of determining the holders
entitled to give their consent or take any other action described above or required or permitted to be taken pursuant to this
Indenture. If a record date is fixed, then notwithstanding the immediately preceding paragraph, those Persons who were holders
at such record date (or their duly designated proxies), and only those Persons, shall be entitled to give such consent or to revoke
any consent previously given or to take any such action, whether or not such Persons continue to be holders after such record
date. No such consent shall be valid or effective for more than 120 days after such record date.
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SECTION 9.04
Notation on or Exchange of Notes
. If an amendment, supplement or waiver changes the terms of a Note, the Issuer may require the holder of the Note to
deliver it to the Trustee. The Trustee may place an appropriate notation on the Note regarding the changed terms and return it to
the holder. Alternatively, if the Issuer or the Trustee so determine, the Issuer in exchange for the Note shall issue and, upon
written order of the Issuer signed by an Officer, the Trustee shall authenticate a new Note that reflects the changed terms. Failure
to make the appropriate notation or to issue a new Note shall not affect the validity of such amendment, supplement or waiver.
SECTION 9.05
Trustee and Collateral Agent to Sign Amendments
. The Trustee, and as applicable, the Collateral Agent, shall sign any amendment, supplement or waiver authorized
pursuant to this Article IX if the amendment does not adversely affect the rights, duties, liabilities or immunities of the Trustee or
the Collateral Agent, as applicable. If it does, the Trustee or the Collateral Agent, as applicable, may but need not sign it. In
signing such amendment, the Trustee or the Collateral Agent, as applicable, shall be entitled to receive indemnity satisfactory to
it and shall be provided with, and (subject to Section 7.01) shall be fully protected in relying upon, (i) an Officer’s Certificate and
(ii) an Opinion of Counsel stating that such amendment, supplement or waiver is authorized or permitted by this Indenture and
that such amendment, supplement or waiver is the legally valid and binding obligation of the Issuer, enforceable against it in
accordance with its terms, subject to customary exceptions, and complies with the provisions hereof. Notwithstanding the
foregoing or anything in this Indenture to the contrary, no Opinion of Counsel shall be required for the Trustee or the Collateral
Agent to execute any supplemental indenture in the form of Exhibit C adding a new Guarantor under this Indenture or adding
Collateral.
ARTICLE X
[INTENTIONALLY OMITTED]
ARTICLE XI
[INTENTIONALLY OMITTED]
ARTICLE XII
GUARANTEE
SECTION 12.01
Guarantee
.
(1)
Subject to this Article XII, each Guarantor hereby jointly and severally, fully and unconditionally guarantees,
on a senior secured basis, to each holder of a Note authenticated and delivered by the Trustee and to the Trustee and its
successors and assigns (i) the performance and punctual payment when due, whether at Stated Maturity, by acceleration or
otherwise, of all obligations of the Issuer under this Indenture and the Notes, whether for payment of principal of, premium, if
any, or interest on the Notes and all other monetary obligations of the Issuer to the holders, the Trustee or the Collateral Agent
under this Indenture and the Notes and (ii) the full and punctual performance within applicable grace periods of all other
obligations of the Issuer whether for fees, expenses, indemnification or otherwise under this Indenture and the Notes (all the
foregoing being hereinafter collectively called the “Guaranteed Obligations”). Each Guarantor further agrees that the Guaranteed
Obligations may be extended or renewed, in whole or in part,
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without notice or further assent from any Guarantor, and that each Guarantor shall remain bound under this Article XII
notwithstanding any extension or renewal of any Guaranteed Obligation.
(2)
Each Guarantor waives (to the fullest extent permitted by law) diligence, presentment, demand of payment,
filing of claims with a court in the event of insolvency or bankruptcy of the Issuer, any right to require a proceeding first against
the Issuer, protest, notice and all demands whatsoever and covenants that the Guaranteed Obligations will not be discharged
except by complete performance of the obligations contained in the Notes and this Indenture. The obligations of each Guarantor
hereunder shall not be affected by (i) the failure of any holder, the Trustee or the Collateral Agent to assert any claim or demand
or to enforce any right or remedy against the Issuer or any other Person under this Indenture, the Notes or any other agreement or
otherwise; (ii) any extension or renewal of this Indenture, the Notes or any other agreement; (iii) any rescission, waiver,
amendment or modification of any of the terms or provisions of this Indenture, the Notes or any other agreement; (iv) the release
of any security held by any holder, the Trustee or the Collateral Agent for the Guaranteed Obligations or each Guarantor; (v) the
failure of any holder, Trustee or the Collateral Agent to exercise any right or remedy against any other guarantor of the
Guaranteed Obligations; or (vi) any change in the ownership of each Guarantor, except as provided in Section 12.02(b). Each
Guarantor hereby waives any right to which it may be entitled to have its obligations hereunder divided among the Guarantors,
such that such Guarantor’s obligations would be less than the full amount claimed.
(3)
Each Guarantor hereby waives any right to which it may be entitled to have the assets of the Issuer first be
used and depleted as payment of the Issuer’s or such Guarantor’s obligations hereunder prior to any amounts being claimed from
or paid by such Guarantor hereunder. Each Guarantor hereby waives any right to which it may be entitled to require that the
Issuer be sued prior to an action being initiated against such Guarantor.
(4)
Each Guarantor further agrees that its Guarantee herein constitutes a guarantee of payment, performance and
compliance when due (and not a guarantee of collection).
(5)
Except as expressly set forth in Sections 8.01(b), 12.02 and 12.06, the obligations of each Guarantor
hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason, including any claim of
waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff, counterclaim, recoupment
or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guaranteed Obligations or
otherwise. Without limiting the generality of the foregoing, the obligations of each Guarantor herein shall not be discharged or
impaired or otherwise affected by the failure of any holder, the Trustee or the Collateral Agent to assert any claim or demand or
to enforce any remedy under this Indenture, the Notes or any other agreement, by any waiver or modification of any thereof, by
any default, failure or delay, willful or otherwise, in the performance of the obligations, or by any other act or thing or omission
or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of any Guarantor or would
otherwise operate as a discharge of any Guarantor as a matter of law or equity.
(6)
Each Guarantor agrees that its Guarantee shall remain in full force and effect until payment in full of all the
Guaranteed Obligations. Each Guarantor further agrees that its Guarantee herein shall continue to be effective or be reinstated, as
the case may be, if at any time payment,
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or any part thereof, of principal of or interest on any Guaranteed Obligation is rescinded or must otherwise be restored by any
holder or the Trustee upon the bankruptcy or reorganization of the Issuer or otherwise.
(7)
Each Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the holders in
respect of any Guaranteed Obligations guaranteed hereby until payment in full of all Guaranteed Obligations. Each Guarantor
further agrees that, as between it, on the one hand, and the holders and the Trustee, on the other hand, (i) the maturity of the
Guaranteed Obligations guaranteed hereby may be accelerated as provided in Article VI for the purposes of the Guarantee herein,
notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Guaranteed Obligations
guaranteed hereby, and (ii) in the event of any declaration of acceleration of such Guaranteed Obligations as provided in
Article VI, such Guaranteed Obligations (whether or not due and payable) shall forthwith become due and payable by the
Guarantors for the purposes of this Section 12.01. Each Guarantor will have the right to seek contribution from any non-paying
Guarantor so long as the exercise of such right does not impair the rights of the holders under the Guaranteed Obligations.
(8)
Each Guarantor also agrees to pay any and all costs and expenses (including reasonable out-of-pocket
attorneys’ fees and expenses) Incurred by the Trustee and the Collateral Agent in enforcing any rights under this Section 12.01.
(9)
Upon request of the Trustee, each Guarantor shall execute and deliver such further instruments and do such
further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.
SECTION 12.02
Limitation on Liability
.
(1)
Any term or provision of this Indenture to the contrary notwithstanding, the maximum aggregate amount of
the Guaranteed Obligations guaranteed hereunder by each Guarantor shall not exceed the maximum amount that can be hereby
guaranteed by the applicable Guarantor without rendering the Guarantee or this Indenture, as it relates to such Guarantor,
voidable under applicable law relating to fraudulent conveyance, fraudulent transfer, preference, transfer at undervalue,
oppression or similar laws affecting the rights of creditors generally.
(2)
A Subsidiary Guarantee as to any Restricted Subsidiary that is (or becomes) a party hereto on the date hereof
or that executes a supplemental indenture in accordance with Section 4.11 hereof and provides a guarantee shall terminate and be
of no further force or effect and such Subsidiary Guarantee shall be deemed to be automatically and unconditionally released
upon any of the following:
(a)
the sale, disposition, exchange or other transfer (including through merger, consolidation,
amalgamation, dividend, distribution or otherwise) of the Capital Stock of the applicable Subsidiary Guarantor if after
such transaction the applicable Subsidiary Guarantor is no longer a Restricted Subsidiary, and if such sale, disposition,
exchange or other transfer is made in a manner not in violation of this Indenture;
(b)
(i) the designation of such Subsidiary Guarantor as an Unrestricted Subsidiary in accordance with
the provisions of Section 4.04 and the definition of
149
“Unrestricted Subsidiary” or (ii) the occurrence of any other event following which such Subsidiary Guarantor is no
longer a Restricted Subsidiary in a manner not in violation of this Indenture; provided that, no such release will occur if
such Subsidiary Guarantor continues to be a guarantor under the Term Loan Credit Agreement;
(c)
the release or discharge of the guarantee by, or direct obligation of, such Subsidiary Guarantor of
the Obligations under the Term Loan Credit Agreement or any other Parity Lien Indebtedness which resulted in the
obligation to guarantee the Notes, other than a release or discharge by or as a result of payment in connection with an
enforcement of remedies under such guarantee or direct obligation;
(d)
the Issuer’s exercise of its legal defeasance option or covenant defeasance option as described under
Article VIII or if the Issuer’s obligations under this Indenture are discharged (including pursuant to a satisfaction and
discharge of this Indenture or through redemption or repurchase of all of the Notes or otherwise) in accordance with the
terms of this Indenture;
(e)
such Subsidiary ceasing to be a Subsidiary as a result of any foreclosure of any pledge or security
interest securing Indebtedness or other exercise of remedies in respect thereof in accordance with the Intercreditor
Agreements;
(f)
upon the merger, amalgamation or consolidation of such Subsidiary Guarantor with and into the
Issuer or another Subsidiary Guarantor or upon the liquidation or dissolution of such Subsidiary Guarantor, in each
case, in a manner not in violation of this Indenture;
(g)
as described under Article IX: and
(h)
(i) such Subsidiary Guarantor becoming an Immaterial Subsidiary or (ii) such Subsidiary Guarantor
becoming an Excluded Subsidiary (other than pursuant to clause (a) of the definition thereof as a result of a transfer of
the Equity Interests of such Subsidiary to an Affiliate of the Issuer) ; provided that, no such release will occur if such
Subsidiary continues to be a guarantor under the Term Loan Credit Agreement.
(3)
(4)
To the extent the Issuer requests evidence of release of a Subsidiary Guarantor pursuant to this Section 12.02
from the Trustee, the Issuer shall deliver an Officer’s Certificate to the Trustee such release.
The Guarantee of Holdings will be released if the Issuer exercises its legal defeasance option or covenant
defeasance option as set forth in Section 8.01(2), if the Issuer’s Obligations under this Indenture are discharged
(including pursuant to a satisfaction and discharge of this Indenture as set forth in Section 8.01 or through redemption
or repurchase of all the Notes or otherwise) in accordance with the terms of this Indenture or if there is a release or
discharge of such Guarantee by, or direct obligation of, Holdings of the Obligations under the Credit Agreements,
except by reason of payment under or the termination or repayment of the Credit Agreements or a discharge or release
by or as a result of payment in connection with the enforcement of remedies under such guarantee or direct obligation.
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SECTION 12.03
[Intentionally Omitted]
.
SECTION 12.04
[Intentionally Omitted]
.
SECTION 12.05
No Waiver
. Neither a failure nor a delay on the part of either the Trustee or the holders in exercising any right, power or privilege
under this Article XII shall operate as a waiver thereof, nor shall a single or partial exercise thereof preclude any other or further
exercise of any right, power or privilege. The rights, remedies and benefits of the Trustee, the Collateral Agent and the holders
herein expressly specified are cumulative and not exclusive of any other rights, remedies or benefits which either may have under
this Article XII at law, in equity, by statute or otherwise.
SECTION 12.06
Modification
. No modification, amendment or waiver of any provision of this Article XII, nor the consent to any departure by any
Guarantor therefrom, shall in any event be effective unless the same shall be in writing and signed by the Trustee, and then such
waiver or consent shall be effective only in the specific instance and for the purpose for which given. No notice to or demand on
any Guarantor in any case shall entitle any Guarantor to any other or further notice or demand in the same, similar or other
circumstances.
SECTION 12.07
Execution of Supplemental Indenture for Future Guarantors
. Each Subsidiary which is required to become a Guarantor of the Notes pursuant to Section 4.11 shall promptly
execute and deliver to the Trustee and the Collateral Agent a supplemental indenture in the form of Exhibit C pursuant to which
such Subsidiary shall become a Guarantor under this Article XII and shall guarantee the Notes. No Opinion of Counsel shall be
required in connection with the execution and delivery of a supplemental indenture in the form of Exhibit C for the addition of a
Guarantor under this Indenture.
SECTION 12.08
Non-Impairment
. The failure to endorse a Guarantee on any Note shall not affect or impair the validity thereof.
ARTICLE XIII
COLLATERAL AND SECURITY
SECTION 13.01
Collateral
.
(a)
From and after the Merger Date, the due and punctual payment of the principal of, premium, if any,
and interest on the Notes and the Guarantees when and as the same shall be due and payable, whether on an Interest Payment
Date, at maturity, by acceleration, repurchase, redemption or otherwise, interest on the overdue principal of and interest (to the
extent permitted by law), if any, on the Notes and the Guarantees and performance of all other obligations under this Indenture,
including, without limitation, the obligations of the Issuer set forth in Section 7.07, and the Notes, the Guarantees and the
Security Documents, shall be secured by a Lien on the Fixed Asset Collateral on a first-priority basis and secured by a Lien on
the Current Asset Collateral on a second-priority basis, in each case subject to Permitted Liens, as provided in this Indenture and
the Security Documents to which the Issuer and the Guarantors, as the case may be, shall become parties to on the Issue Date or
thereafter and will be secured by all of the Collateral pledged pursuant to the Security Documents hereafter delivered as required
or permitted by this Indenture and the Security Documents. The Issuer, for the benefit of the
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holders, hereby appoints The Bank of New York Mellon as the initial Collateral Agent, and the Collateral Agent is hereby
authorized and directed to execute and deliver the Security Documents and the Intercreditor Agreements. Each holder by its
acceptance of any Notes and the Guarantees thereof, irrevocably consents and agrees to such appointment.
(b)
Each holder, by its acceptance of any Notes and the Guarantees, consents and agrees to the terms
of the Security Documents and the Intercreditor Agreements (including, without limitation, the provisions providing for
foreclosure and release of Collateral and the automatic amendments, supplements, consents, waivers and other modifications
thereto without the consent of the holders) as the same may be in effect or may be amended from time to time in accordance with
their terms and this Indenture and authorizes and directs the Collateral Agent to perform its obligations and exercise its rights
under the Security Documents and the Intercreditor Agreements in accordance therewith, binding such holder to the terms
thereof.
(c)
The Trustee and each holder, by accepting the Notes and the Guarantees, acknowledges that, as
more fully set forth in the Security Documents and the Intercreditor Agreements, the Collateral as hereafter constituted shall be
held for the benefit of all the holders and the Trustee, and that the Lien of this Indenture and the Security Documents in respect of
the Trustee and the holders is subject to and qualified and limited in all respects by the Security Documents and the Intercreditor
Agreements and actions that may be taken thereunder.
SECTION 13.02
[Intentionally Omitted]
.
SECTION 13.03
Impairment of Security Interests
.
From and after the Merger Date, neither Holdings, the Issuer nor any of its Restricted Subsidiaries will (i) take or
knowingly or negligently omit to take any action which would materially adversely affect or impair the Liens in favor of the
Collateral Agent, the Trustee and the holders with respect to the Collateral, unless such action or failure to take action is
otherwise permitted by this Indenture, the Security Documents or the Intercreditor Agreements or (ii) grant any Person, or permit
any Person to retain (other than the Collateral Agent), any Liens on the Collateral, other than Permitted Liens. To the extent
required under this Indenture or the Security Documents, from and after the Merger Date, the Issuer and each Guarantor will, at
its sole cost and expense, execute and deliver all such agreements and instruments as necessary, or as the Trustee or the Collateral
Agent reasonably requests, to more fully or accurately describe the assets and property intended to be Collateral or the
Obligations intended to be secured by the Security Documents.
SECTION 13.04
Further Assurances
.
To the extent required under this Indenture or any of the Security Documents or the Intercreditor Agreements, from and
after the Merger Date, the Issuer and the Guarantors shall execute any and all further documents, financing statements,
agreements and instruments, and take all further actions that may be required under applicable law, or that the Collateral Agent or
the Trustee may reasonably request, in order to grant, preserve, protect and perfect the validity and priority of the security
interests and Liens created or intended to be created by the Security Documents in the Collateral. In addition, to the extent
required under this Indenture or the Security
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Documents, from time to time, the Issuer and the Guarantors will reasonably promptly secure the obligations under this Indenture
and Security Documents by pledging or creating, or causing to be pledged or created, perfected security interests and Liens with
respect to the Collateral to the extent required by this Indenture and/or the Security Documents.
SECTION 13.05
After-Acquired Property
.
Upon the acquisition by any of the Issuer or the Guarantors after the Merger Date of any assets (other than Excluded
Assets and exceptions based on immateriality thresholds of aggregate assets as set forth in the Security Documents), the Issuer or
such Guarantor shall execute and deliver to the extent required by this Indenture and/or the Security Documents, any information,
documentation, financing statements or other certificates and Opinions of Counsel as may be necessary to vest in the Collateral
Agent a perfected security interest, with the priority required by this Indenture and the Security Documents, subject only to
Permitted Liens, in such after-acquired property and to have such after-acquired property added to the Collateral, and thereupon
all provisions of this Indenture and the Security Documents relating to the Collateral shall be deemed to relate to such after-
acquired property to the same extent and with the same force and effect.
SECTION 13.06
[Intentionally Omitted]
.
SECTION 13.07
Negative Pledge
.
From and after the Issue Date and the consummation of the Merger, the Issuer and each Guarantor shall not, and the
Issuer shall not permit any of its Restricted Subsidiaries to, further pledge the Collateral as security or otherwise, subject to
Permitted Liens; provided, however, that the Issuer, subject to compliance with Section 4.03 and Section 4.12, shall be permitted
to issue an unlimited aggregate principal amount of Additional Notes, all of which may be secured by the Collateral.
SECTION 13.08
Release of Liens on the Collateral
.
applicable:
(a)
The Liens on the Collateral will be released with respect to the Notes and the related Guarantees, as
(1)
in part, as to any property or assets constituting Collateral, to enable the disposition of such
property or assets (to a Person that is not the Issuer or a Guarantor) to the extent permitted under Section 4.06;
(2)
(i) in the case of a Subsidiary Guarantor that is released from its Guarantee with respect to the Term
Loan Credit Agreement and any other Parity Lien Indebtedness other than by reason of payment under or the
termination or repayment of the Term Loan Credit Agreement or such other Parity Lien Indebtedness, the release of the
property and assets of such Guarantor; or (ii) the release of Collateral held by any Guarantor upon the release of such
Guarantor from its Guarantee of the Notes;
(3)
such property or assets becoming an Excluded Asset, Excluded Equity Interests or an asset owned
by an Excluded Subsidiary;
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(4)
Excluded Subsidiary;
as to the assets owned by such Excluded Subsidiary, upon any Subsidiary Guarantor becoming an
(5)
any Securitization Assets becoming subject to a Qualified Securitization Financing to the extent
required by the terms of such Qualified Securitization Financing;
(6)
(7)
as required pursuant to the terms of any Intercreditor Agreement; and
as contemplated by Article IX.
The security interest in all Collateral securing the Notes also will be released upon (i) payment in full of the principal
of, together with accrued and unpaid interest and premium, if any, on, the Notes and all other Obligations under this Indenture,
the Guarantees and the Security Documents that are due and payable at or prior to the time such principal, together with accrued
and unpaid interest and premium, if any, are paid (including pursuant to a satisfaction and discharge of this Indenture pursuant to
Article VIII or (ii) a legal defeasance or covenant defeasance as set forth in Article VIII.
each proposed release of Collateral pursuant to Sections 13.08(a)(1) through (6) or pursuant to the Security Documents:
(b)
The Issuer or the applicable Guarantor will furnish to the Trustee and the Collateral Agent, prior to
(1)
an Officer’s Certificate and an Opinion of Counsel each to the effect that (i) all conditions precedent
provided for in this Indenture and the Security Documents to such release have been complied with, (ii) such release is
authorized or permitted by the terms of this Indenture and the Security Documents; and
(2)
a form of such release (which release shall provide that the requested release is without recourse or
warranty to the Trustee or the Collateral Agent).
(c)
Upon compliance by the Issuer or any Guarantor, as the case may be, with the conditions precedent
set forth above, and delivery by the Issuer or such Guarantor to the Trustee of an Officer’s Certificate and an Opinion of Counsel
in accordance with Section 13.08(b) herein, the Issuer and the relevant Guarantor shall authorize and direct the Collateral Agent
to promptly cause to be released and reconveyed to the Issuer or the relevant Guarantor, as the case may be, the released
Collateral, and take all other actions reasonably requested by the Issuer or such Guarantor in connection therewith, at the Issuer’s
expense.
SECTION 13.09
Authorization of Actions to be Taken by the Trustee or the Collateral Agent under the Security
Documents and the Intercreditor Agreements
.
(a)
Subject to the provisions of Article VII of this Indenture and the provisions of the Security
Documents and the Intercreditor Agreements, each of the Trustee or the Collateral Agent may (but shall in no event be required
to), in its sole discretion and without the consent of the holders, on behalf of the holders, take all actions it deems necessary or
appropriate in order to (i) enforce any of its rights or any of the rights of the holders under the Security Documents and the
Intercreditor Agreements and (ii) collect and receive any and all amounts payable in respect of the Collateral in respect of the
obligations of the Issuer and the Guarantors hereunder and
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thereunder. Subject to the provisions of the Security Documents and the Intercreditor Agreements, the Trustee or the Collateral
Agent shall have the power, but not the obligation, to institute and to maintain such suits and proceedings as it may deem
expedient to prevent any impairment of the Collateral by any acts that may be unlawful or in violation of the Security Documents
or this Indenture, and such suits and proceedings as the Trustee or the Collateral Agent may deem expedient to preserve or
protect its interest and the interests of the holders in the Collateral (including the power to institute and maintain suits or
proceedings to restrain the enforcement of or compliance with any legislative or other governmental enactment, rule or order that
may be unconstitutional or otherwise invalid if the enforcement of, or compliance with, such enactment, rule or order would
impair the security interest hereunder or be prejudicial to the interests of the holders or the Trustee).
(b)
The Trustee or the Collateral Agent shall not be responsible for the existence, genuineness or value
(or diminution of value) of any of the Collateral or for the validity, perfection, priority or enforceability of the Liens in any of the
Collateral, whether impaired by operation of law or by reason of any action on its part hereunder, for the validity or sufficiency of
the Collateral or any agreement or assignment contained therein, for the validity of the title of the Issuer to the Collateral, for
insuring the Collateral or for the payment of taxes, charges, assessments or Liens upon the Collateral or otherwise as to the
maintenance of the Collateral. The Trustee or the Collateral Agent shall have no responsibility for recording, filing, re-recording
or refiling any financing statement, continuation statement, termination statement, document, instrument, other notice or any
amendment thereto in any public office at any time or times or to otherwise take any action to perfect or maintain the perfection
of any security interest granted to it under the Security Documents or otherwise. Beyond the exercise of reasonable care in the
custody thereof, the Trustee and the Collateral Agent shall have no duty as to any Collateral in their possession or control or in
the possession or control of any agent or bailee or any income thereon or as to preservation of rights against prior parties or any
other rights pertaining thereto. The Trustee and the Collateral Agent shall be deemed to have exercised reasonable care in the
custody of the Collateral in their possession if the Collateral is accorded treatment substantially equal to that which they accord
the property of similar clients and shall not be liable or responsible for any loss or diminution in the value of any of the Collateral
by reason of the act or omission of any carrier, forwarding agency or other agent or bailee selected by the Trustee or the
Collateral Agent, as the case may be, in good faith. The Trustee and the Collateral Agent shall have no duty to ascertain or
inquire as to the performance or observance of any of the terms of this Indenture or the Security Documents by the Issuer or the
Guarantors.
(c)
Where any provision of this Indenture requires that additional property or assets be added to the
Collateral, the Issuer and each Guarantor, as applicable, shall deliver to the Trustee or the Collateral Agent the following (in each
case, to the extent any additional actions on the part of the Issuer or applicable Guarantor are necessary to provide, grant or
perfect a security interest in such Collateral as required under this Indenture and the applicable Security Documents):
(1)
a request from the Issuer that such Collateral be added;
(2)
the form of instrument adding such Collateral, which, based on the type and location of the property
subject thereto, shall be in substantially the form of the applicable Security Documents entered into on the Issue Date or
on the date first delivered in the case
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of Collateral that is permitted hereunder to be delivered after the Issue Date, with such changes thereto as the Issuer
shall consider appropriate, or in such other form as the Issuer shall deem proper; provided that any such changes or
such form are administratively satisfactory to the Trustee or the Collateral Agent;
(3)
an Officer’s Certificate to the effect that the Collateral being added is in the form, consists of the
assets, if applicable, and is in the amount or otherwise has the Fair Market Value required by this Indenture;
(4)
to the extent such Collateral is being added in connection with the joinder of a Subsidiary Guarantor
to this Indenture, an Officer’s Certificate to the effect that all conditions precedent provided for in this Indenture to the
addition of such Collateral have been complied with; and
(5)
such financing statements, if any, as the Issuer shall deem necessary to perfect the Collateral
Agent’s security interest in such Collateral.
(d)
The Trustee or the Collateral Agent, in giving any consent or approval under the Security
Documents, shall be entitled to receive, as a condition to such consent or approval, an Officer’s Certificate to the effect that the
action or omission for which consent or approval is to be given is authorized and permitted according to the terms of this
Indenture and the Security Documents, and the Trustee or the Collateral Agent shall be fully protected in giving such consent or
approval on the basis of such Officer’s Certificate.
SECTION 13.10
Information Regarding Collateral
.
(a)
The Issuer will furnish to the Collateral Agent, with respect to the Issuer or any Guarantor, within
forty-five calendar days of any change in such Person’s (1) legal name, (2) jurisdiction of organization or formation, (3) identity
or type of organization or (4) location (within the meaning of Section 9-307 of the Uniform Commercial Code). Within forty five
(45) days (or such longer period as may be agreed by the Term Loan Collateral Agent) of the occurrence of any of the foregoing,
the Issuer and the Guarantors will make all filings under the Uniform Commercial Code and any other applicable Laws that are
required by this Indenture and/or the Security Documents in order for the Collateral to be made subject to the Lien of the
Collateral Agent under this Indenture and/or the Security Documents in the manner and to the extent required by this Indenture or
any of the Security Documents, and shall take all necessary action so that such Lien is perfected with the same priority as
immediately prior to such change to the extent required by this Indenture and/or the Security Documents.
The Issuer shall deliver to the Trustee and the Collateral Agent an Officer’s Certificate attaching
supplemental schedules required under the Security Documents to the extent required under and at the same time as similar
supplemental schedules are delivered to the Term Loan Collateral Agent.
(b)
SECTION 13.11
Security Documents and Intercreditor Agreements
.
The provisions in this Indenture relating to Collateral are subject to the provisions of the Security Documents and the
Intercreditor Agreements. The Issuer, the Guarantors, the Trustee and
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the Collateral Agent acknowledge and agree to be bound by the provisions of the Security Documents and the Intercreditor
Agreements.
SECTION 13.12
Collateral Agent
.
(a)
By accepting a Note, each holder will be deemed to have irrevocably appointed the Collateral Agent to act as
its agent under the Security Documents and the Intercreditor Agreements and to have irrevocably authorized and directed the
Collateral Agent to (i) perform the duties and exercise the rights, powers and discretions that are specifically given to it under the
Security Documents, the Intercreditor Agreements or other documents to which it is a party, together with any other incidental
rights, powers and discretions; and (ii) execute each document expressed to be executed by the Collateral Agent on its behalf.
Each of the holders hereby exempts the Collateral Agent from any restrictions on representing several persons and self-
dealing under any applicable law to the extent legally permissible for such holder.
(b)
The Collateral Agent is authorized and empowered to appoint one or more subagents or co-collateral agents
as it deems necessary or appropriate, including without limitation the Term Loan Collateral Agent.
(c)
The Collateral Agent shall have all the rights and protection provided in the Security Documents as well as
the rights and protections afforded to it hereunder; provided, however, that the Issuer shall not reimburse any expense or
indemnify against any loss, liability or expense incurred by the Collateral Agent through the Collateral Agent’s own willful
misconduct or gross negligence, as determined by a final order of a court of competent jurisdiction.
(d)
None of the Trustee, the Collateral Agent or any of their respective officers, directors, employees, attorneys
or agents will be responsible or liable (i) for the existence, genuineness, value or protection of any Collateral, for the legality,
enforceability, effectiveness or sufficiency of the Security Documents, for the creation, perfection, continuation of perfection,
priority, sufficiency or protection of any Lien securing the Notes or any defect or deficiency as to any such matters, or (ii) to
monitor the status of any Lien or the performance of the Collateral or for any failure to demand, collect, foreclose, or realize upon
or otherwise enforce any of such liens, except to the extent any possessory collateral is delivered to the Collateral Agent for
perfection purposes.
(e)
Subject to the Security Documents and the Intercreditor Agreements, except as directed by the Trustee as
required or permitted by this Indenture, the holders acknowledge that the Collateral Agent will not be obligated:
A.
to act upon directions purported to be delivered to it by any other Person;
B.
C.
to foreclose upon or otherwise enforce any Lien securing the Notes; or
to take any other action whatsoever with regard to any or all Liens securing the Notes, the Security
Documents or the Collateral.
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(f)
In acting as Collateral Agent, co-collateral agent or sub-collateral agent, the Collateral Agent, each co-
collateral agent and each sub-collateral agent may rely upon and enforce each and all of the rights, powers, immunities,
indemnities and benefits of the Trustee under Article VII hereof.
(g)
Neither the Trustee nor the Collateral Agent shall be responsible for or have any duty or obligation to file any
financing statements, continuation statements (including, Uniform Commercial Code financing and continuation statements) or
amendments thereto or any other agreement or instrument to record or perfect or maintain the perfection of the Collateral Agent’s
security interest in the Collateral.
ARTICLE XIV
MISCELLANEOUS
SECTION 14.01
[Intentionally Omitted]
.
SECTION 14.02
Notices
.
(1)
Any notice or communication required or permitted hereunder shall be in writing and delivered in person, via
facsimile or mailed by first-class mail or sent by electronic mail in PDF format addressed as follows:
if to the Issuer or a Guarantor:
Pearl Excellence Holdco Inc.
2nd Floor, 2600 Lynsander Lane
Richmond BC
Canada, V7B 1C3
Attn: Head of Legal
Email: contract.notices@paperexcellence.com
with a copy (which shall not constitute notice) to:
Latham & Watkins LLP
555 Eleventh Street, NW
Suite 1000
Washington, DC 20004
Attention: Jason Licht
Fax: 202-637-2201
Email: jlicht@lw.com
if to the Trustee or the Collateral Agent:
The Bank of New York Mellon
240 Greenwich Street, Floor 7E
Attention: Corporate Trust
New York, New York 10286
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Tel: (212) 815-3114
Email: wanda.camacho@bnymellon.com
The Issuer, the Trustee or the Collateral Agent by notice to the other may designate additional or different addresses for
subsequent notices or communications.
(2)
Any notice or communication mailed to a holder shall be mailed, first class mail, to the holder at the holder’s
address as it appears on the registration books of the Registrar and shall be sufficiently given if so mailed within the time
prescribed.
(3)
Failure to send a notice or communication to a holder or any defect in it shall not affect its sufficiency with
respect to other holders. If a notice or communication is sent in the manner provided above, it is duly given, whether or not the
addressee receives it, except that notices to the Trustee and the Collateral Agent are effective only if received.
The Trustee shall have the right to accept and act upon instructions, including funds transfer instructions
(“Instructions”) given pursuant to each of this Indenture, Intercreditor Agreements, Security Documents and delivered using
Electronic Means; provided, however, that the Issuer and/or the Guarantors, as applicable, shall provide to the Trustee an
incumbency certificate listing officers with the authority to provide such Instructions (“Authorized Officers”) and containing
specimen signatures of such Authorized Officers, which incumbency certificate shall be amended by the Issuer and/or the
Guarantors, as applicable, whenever a person is to be added or deleted from the listing. If the Issuer and/or the Guarantors, as
applicable, elects to give the Trustee Instructions using Electronic Means and the Trustee in its discretion elects to act upon such
Instructions, the Trustee’s understanding of such Instructions shall be deemed controlling. The Issuer and the Guarantors
understand and agree that the Trustee cannot determine the identity of the actual sender of such Instructions and that the Trustee
shall conclusively presume that directions that purport to have been sent by an Authorized Officer listed on the incumbency
certificate provided to the Trustee have been sent by such Authorized Officer. The Issuer and the Guarantors shall be responsible
for ensuring that only Authorized Officers transmit such Instructions to the Trustee and that the Issuer, the Guarantors and all
Authorized Officers are solely responsible to safeguard the use and confidentiality of applicable user and authorization codes,
passwords and/or authentication keys upon receipt by the Issuer and/or the Guarantors, as applicable. The Trustee shall not be
liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such
Instructions notwithstanding such directions conflict or are inconsistent with a subsequent written instruction. The Issuer and the
Guarantors agree: (i) to assume all risks arising out of the use of Electronic Means to submit Instructions to the Trustee, including
without limitation the risk of the Trustee acting on unauthorized Instructions, and the risk of interception and misuse by third
parties; (ii) that it is fully informed of the protections and risks associated with the various methods of transmitting Instructions to
the Trustee and that there may be more secure methods of transmitting Instructions than the method(s) selected by the Issuer
and/or the Guarantors, as applicable; (iii) that the security procedures (if any) to be followed in connection with its transmission
of Instructions provide to it a commercially reasonable degree of protection in light of its particular needs and circumstances; and
(iv)
the security
procedures. “Electronic Means” shall mean the following communications
learning of any compromise or unauthorized use of
immediately upon
the Trustee
to notify
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methods: e-mail, facsimile transmission, secure electronic transmission containing applicable authorization codes, passwords
and/or authentication keys issued by the Trustee, or another method or system specified by the Trustee as available for use in
connection with its services hereunder.
Notwithstanding anything to the contrary contained herein, as long as the Notes are in the form of a Global Note, notice
to the holders may be made electronically in accordance with procedures of the Depository.
SECTION 14.03
[Intentionally Omitted]
.
SECTION 14.04
Certificate and Opinion as to Conditions Precedent
. Upon any request or application by the Issuer to the Trustee or the Collateral Agent to take or refrain from taking any
action under this Indenture, the Issuer shall furnish to the Trustee at the request of the Trustee or to the Collateral Agent at the
request of the Collateral Agent, as applicable:
(1)
an Officer’s Certificate in form reasonably satisfactory to the Trustee or the Collateral Agent, as applicable,
stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture relating to the proposed
action have been complied with; and
(2)
an Opinion of Counsel in form reasonably satisfactory to the Trustee or the Collateral Agent, as applicable,
stating that, in the opinion of such counsel, all such conditions precedent have been complied with;
provided that (x) no Officer’s Certificate or Opinion of Counsel will be required to be furnished to the Trustee in connection with
the authentication and delivery of the Initial Notes on the Issue Date and (y) no Opinion of Counsel will be required to be
furnished to the Trustee and the Collateral Agent in connection with the execution of any supplemental indenture in the form of
Exhibit C adding a new Guarantor under this Indenture or adding Collateral. In the absence of an Opinion of Counsel that is not
required to be furnished hereunder, the Trustee and the Collateral Agent shall be entitled to conclusively rely on an Officer’s
Certificate in executing and delivering any such documents and shall have no liability for taking such action without receipt of an
Opinion of Counsel.
SECTION 14.05
Statements Required in Certificate or Opinion
. Each certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture
(other than pursuant to Section 4.09) shall include:
(1)
(2)
a statement that the individual making such certificate or opinion has read such covenant or condition;
a brief statement as to the nature and scope of the examination or investigation upon which the statements or
opinions contained in such certificate or opinion are based;
(3)
a statement that, in the opinion of such individual, he has made such examination or investigation as is
necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with;
and
160
(4)
a statement as to whether or not, in the opinion of such individual, such covenant or condition has been
complied with; provided, however, that with respect to matters of fact an Opinion of Counsel may rely on an Officer’s Certificate
or certificates of public officials.
SECTION 14.06
When Notes Disregarded
. In determining whether the holders of the required principal amount of Notes have concurred in any direction, waiver
or consent (other than in respect of any action pursuant to Section 9.02, which requires consent of a holder of an affected Note),
Notes owned by the Issuer, the Guarantors or by any Person directly or indirectly controlling or controlled by or under direct or
indirect common control with the Issuer or the Guarantors shall be disregarded and deemed not to be outstanding, except that, for
the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes
which the Trustee actually knows are so owned shall be so disregarded. Subject to the foregoing, only Notes outstanding at the
time shall be considered in any such determination.
SECTION 14.07
Rules by Trustee, Paying Agent and Registrar
. The Trustee may make reasonable rules for action by or a meeting of the holders. The Registrar and a Paying Agent
may make reasonable rules for their functions.
SECTION 14.08
Legal Holidays
. If a payment date (including any redemption date or repurchase date) is not a Business Day, payment shall be made
on the next succeeding day that is a Business Day, and no interest shall accrue on any amount that would have been otherwise
payable on such payment date if it were a Business Day for the intervening period. If a regular Record Date is not a Business
Day, the Record Date shall not be affected. If performance of any covenant, duty or obligation is required on a date which is not
a Business Day, performance shall not be required until the next succeeding day that is a Business Day.
SECTION 14.09
GOVERNING LAW; Consent to Jurisdiction
.
(1)
THIS INDENTURE, THE NOTES, THE GUARANTEES AND THE SECURITY DOCUMENTS
(UNLESS SUCH SECURITY DOCUMENT SHALL SPECIFY THE LAWS OF ANOTHER STATE) SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
(2)
The parties irrevocably and unconditionally submit to the exclusive jurisdiction of the United States District
Court for the Southern District of New York and any New York State court sitting in the Borough of Manhattan, City of
New York, over any suit, action or proceeding arising out of or relating to this Indenture. To the fullest extent permitted by
applicable law, each party irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim
that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the
venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient forum and any right of jurisdiction on account of its place or
residence or domicile.
SECTION 14.10 No Recourse Against Others
. No director, officer, employee, manager, incorporator or holder of any Equity Interests in the Issuer, any Subsidiary
independent contractor, consultant, distributor, or any Parent Entity, as such, shall have any liability for any obligations of
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the Issuer or any Guarantor under the Notes, this Indenture the Guarantees, the Security Documents or the Intercreditor
Agreements, as applicable, or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each
holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration
for issuance of the Notes.
SECTION 14.11
Successors
. All agreements of the Issuer and the Guarantors in this Indenture and the Notes shall bind such person’s
successors. All agreements of the Trustee in this Indenture shall bind its successors.
SECTION 14.12
Multiple Originals
. The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them
together represent the same agreement. Delivery of an executed counterpart of a signature page to this Indenture by telecopier,
facsimile, email or other electronic transmission (including, without limitation, a “jpg,” “pdf” or “tif”, DocuSign and the like)
shall be effective as delivery of a manually executed counterpart thereof. One signed copy is enough to prove this Indenture. The
words “execution,” “signed,” “signature,” “delivery,” and words of like import in or relating to this Indenture or any document to
be signed in connection with this Indenture shall be deemed to include electronic signatures, deliveries or the keeping of records
in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature,
physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, and the parties hereto consent to
conduct the transactions contemplated hereunder by electronic means.
SECTION 14.13
Table of Contents; Headings
. The table of contents, cross-reference sheet and headings of the Articles and Sections of this Indenture have been
inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of
the terms or provisions hereof.
SECTION 14.14
Indenture Controls
. If and to the extent that any provision of the Notes limits, qualifies or conflicts with a provision of this Indenture,
such provision of this Indenture shall control.
SECTION 14.15
Severability
. In case any provision in this Indenture shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or impaired thereby and such provision shall be
ineffective only to the extent of such invalidity, illegality or unenforceability.
SECTION 14.16
Waiver of Jury Trial
. EACH OF THE ISSUER, THE GUARANTORS, THE TRUSTEE AND THE COLLATERAL AGENT
HEREBY (AND EACH HOLDER OF A NOTE BY ITS ACCEPTANCE THEREOF) IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN
ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE
TRANSACTION CONTEMPLATED HEREBY.
SECTION 14.17
Calculations
. The Issuer will be responsible for making all calculations called for under this Indenture or the Notes, including but
not limited to determination of
162
redemption price, premium if any, and any additional amounts or other amounts payable on the Notes. The Issuer will make all
such calculations in good faith and, absent manifest error, its calculations will be final and binding on holders. The Issuer will
provide a schedule of its calculations to the Trustee and the Trustee is entitled to rely conclusively upon the accuracy of such
calculation without independent verification. The Issuer will deliver a copy of such schedule to any holder upon the written
request of such holder.
SECTION 14.18
USA Patriot Act
. The parties hereto acknowledge that in accordance with Section 326 of the USA Patriot Act, the Trustee and
Collateral Agent, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is
required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens
an account with the Trustee and the Collateral Agent. The parties to this Indenture agree that they will provide the Trustee and the
Collateral Agent with such information as it may request in order for the Trustee to satisfy the requirements of the USA Patriot
Act.
Neither the Issuer nor its subsidiaries or, to the Issuer’s knowledge, any of the Issuer’s affiliates, directors or officers,
are the target or subject of any sanctions enforced by the US Government, (including, the Office of Foreign Assets Control of the
US Department of the Treasury (“OFAC”)), the United Nations Security Council, the European Union, HM Treasury, or other
relevant sanctions authority (collectively “Sanctions”). Neither the Issuer nor any of its affiliates, subsidiaries, directors or
officers will use any payments made pursuant to this Agreement, (i) to fund or facilitate any activities of or business with any
person who, at the time of such funding or facilitation, is the subject or target of Sanctions, (ii) to fund or facilitate any activities
of or business with any country or territory that is the target or subject of Sanctions, or (iii) in any other manner that will result in
a violation of Sanctions by any person.
SECTION 14.19
No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Issuer or their
Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.
[Remainder of page intentionally left blank.]
163
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written
above.
PEARL MERGER SUB INC., as the Escrow Issuer
By:
Name:
Title:
CG&R Draft
154254371.8
CG&R Draft
CG&R Draft
Current date: 10/16/2021 8:48 PM63135366v5
Current date: 10/17/2021 4:43 PM63135366v6
Current date: 10/17/2021 8:12 PM63135366v7
[Signature Page to Indenture]
THE BANK OF NEW YORK MELLON, as Trustee and Collateral
Agent
By:
Name:
Title:
[Signature Page to Indenture]
CG&R Draft
154254371.8
CG&R Draft
CG&R Draft
Current date: 10/16/2021 8:48 PM63135366v5
Current date: 10/17/2021 4:43 PM63135366v6
Current date: 10/17/2021 8:12 PM63135366v7
PROVISIONS RELATING TO INITIAL NOTES AND ADDITIONAL NOTES
APPENDIX A
1.
Definitions
.
1.1
.
Definitions
For the purposes of this Appendix A the following terms shall have the meanings indicated below:
“Definitive Note” means a certificated Initial Note or Additional Note (bearing the Restricted Notes Legend if the
transfer of such Note is restricted by applicable law) that does not include the Global Notes Legend.
“Depository” means The Depository Trust Company, its nominees and their respective successors.
“Global Notes Legend” means the legend set forth under that caption in Exhibit A to this Indenture.
“IAI” means an institutional “accredited investor” as described in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act.
“Notes Custodian” means the custodian with respect to a Global Note (as appointed by the Depository) or any
successor person thereto, who shall initially be the Trustee.
“QIB” means a “qualified institutional buyer” as defined in Rule 144A.
“Regulation S” means Regulation S under the Securities Act.
“Regulation S Notes” means all Initial Notes offered and sold outside the United States in reliance on Regulation S.
“Restricted Notes Legend” means the legend set forth in Section 2.2(f)(i) herein.
“Restricted Period,” with respect to any Notes, means the period of 40 consecutive days beginning on and including the
later of (a) the day on which such Notes are first offered to persons other than distributors (as defined in Regulation S under the
Securities Act) in reliance on Regulation S, notice of which day shall be promptly given by the Issuer to the Trustee, and (b) the
Issue Date, and with respect to any Additional Notes that are Transfer Restricted Notes, it means the comparable period of 40
consecutive days.
“Rule 144A” means Rule 144A under the Securities Act.
“Rule 144A Notes” means all Initial Notes initially offered and sold to QIBs in reliance on Rule 144A.
“Rule 501” means Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
Appendix A-1
“Transfer Restricted Definitive Notes” means Definitive Notes that bear or are required to bear or are subject to the
Restricted Notes Legend.
“Transfer Restricted Global Notes” means Global Notes that bear or are required to bear or are subject to the Restricted
Notes Legend.
“Transfer Restricted Notes” means the Transfer Restricted Definitive Notes and Transfer Restricted Global Notes.
“Unrestricted Definitive Notes” means Definitive Notes that are not required to bear, or are not subject to, the
Restricted Notes Legend.
“Unrestricted Global Notes” means Global Notes that are not required to bear, or are not subject to, the Restricted
Notes Legend.
1.2
.
Other Definitions
Term
Agent Members
Clearstream
Euroclear
Global Notes
Regulation S Global Notes
Regulation S Permanent Global Note
Regulation S Temporary Global Note
Rule 144A Global Notes
2.
The Notes
.
2.1
.
Form and Dating; Global Notes
Defined in Section
2.1(b)
2.1(b)
2.1(b)
2.1(b)
2.1(b)
2.1(b)
2.1(b)
2.1(b)
(a)
The Initial Notes issued on the date hereof will be (i) privately placed by the Issuer pursuant to the
Offering Memorandum and (ii) sold, initially only to (1) QIBs in reliance on Rule 144A and (2) Persons other than U.S.
Persons (as defined in Regulation S) in reliance on Regulation S. Such Initial Notes may thereafter be transferred to,
among others, QIBs, purchasers in reliance on Regulation S and, except as set forth below, IAIs in accordance with
Rule 501. One or more Rule 144A Notes may be issued with a separate CUSIP number for purposes of transfers of
Notes to IAIs in accordance with Rule 501. Additional Notes offered after the date hereof may be offered and sold by
the Issuer from time to time pursuant to one or more agreements in accordance with applicable law.
(b)
Global Notes.
(i)
Except as provided in clause (d) of Section 2.2 below, Rule 144A Notes initially shall be
represented by one or more Notes in definitive, fully registered, global form without interest coupons
(collectively, the “Rule 144A Global Notes”).
Appendix A-2
Regulation S Notes initially shall be represented by one or more Notes in fully registered, global
form without interest coupons (collectively, the “Regulation S Temporary Global Note” and, together with
the Regulation S Permanent Global Note (defined below), the “Regulation S Global Notes”), which shall be
registered in the name of the Depository or the nominee of the Depository for the accounts of designated
agents holding on behalf of Euroclear Bank S.A./N.V., as operator of the Euroclear system (“Euroclear”) or
Clearstream Banking, S.A. (“Clearstream”).
Following the termination of the Restricted Period, beneficial interests in the Regulation S
Temporary Global Note shall be exchanged for beneficial interests in a permanent Global Note (the
the
“Regulation S Permanent Global Note”) pursuant
Depository. Simultaneously with the authentication of the Regulation S Permanent Global Note, the Trustee
shall cancel the Regulation S Temporary Global Note. The aggregate principal amount of the Regulation S
Temporary Global Note and the Regulation S Permanent Global Note may from time to time be increased or
decreased by adjustments made on the records of the Trustee and the Depository or its nominee, as the case
may be, in connection with transfers of interest as hereinafter provided.
applicable procedures of
the
to
The provisions of the “Operating Procedures of the Euroclear System” and “Terms and Conditions
Governing Use of Euroclear” and the “General Terms and Conditions of Clearstream Banking” and
“Customer Handbook” of Clearstream shall be applicable to transfers of beneficial interests in the Regulation
S Temporary Global Note and the Regulation S Permanent Global Note that are held by participants through
Euroclear or Clearstream.
The term “Global Notes” means the Rule 144A Global Notes and the Regulation S Global
Notes. The Global Notes shall bear the Global Note Legend. The Global Notes initially shall (i) be
registered in the name of the Depository or the nominee of such Depository, in each case for credit to an
account of an Agent Member (as defined below), (ii) be delivered to the Trustee as Notes Custodian for such
Depository and (iii) bear the Restricted Notes Legend.
Members of, or direct or indirect participants in, the Depository (collectively, the “Agent Members”)
shall have no rights under this Indenture with respect to any Global Note held on their behalf by the
Depository, or the Trustee as Notes Custodian, or under the Global Notes. The Depository may be treated by
the Issuer, the Trustee and any agent of the Issuer or the Trustee as the absolute owner of the Global Notes for
all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Issuer, the Trustee
or any agent of the Issuer or the Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depository, or impair, as between the Depository and its Agent Members, the
operation of customary practices governing the exercise of the rights of a holder of any Note.
(ii)
Transfers of Global Notes shall be limited to transfer in whole, but not in part, to the
Depository, its successors or their respective nominees. Interests
Appendix A-3
of beneficial owners in the Global Notes may be transferred or exchanged for Definitive Notes only in
accordance with the applicable rules and procedures of the Depository and the provisions of Section 2.2. In
addition, a Global Note shall be exchangeable for Definitive Notes if (x) the Depository (1) notifies the Issuer
that it is unwilling or unable to continue as depository for such Global Note and the Issuer thereupon fails to
appoint a successor depository or (2) has ceased to be a clearing agency registered under the Exchange Act or
(y) there shall have occurred and be continuing an Event of Default with respect to such Global Note and a
request has been made for such exchange; provided that in no event shall the Regulation S Temporary Global
Note be exchanged by the Issuer for Definitive Notes prior to (x) the expiration of the Restricted Period and
(y) the receipt by the Registrar of any certificates required pursuant to Rule 903(b)(3)(ii)(B) under the
Securities Act. In all cases, Definitive Notes delivered in exchange for any Global Note or beneficial
interests therein shall be registered in the names, and issued in any approved denominations, requested by or
on behalf of the Depository in accordance with its customary procedures.
(iii)
In connection with the transfer of a Global Note as an entirety to beneficial owners
pursuant to subsection (i) of this Section 2.1(b), such Global Note shall be deemed to be surrendered to the
Trustee for cancellation, and the Issuer shall execute, and, upon written order of the Issuer signed by an
Officer, the Trustee shall authenticate and make available for delivery, to each beneficial owner identified by
the Depository in writing in exchange for its beneficial interest in such Global Note, an equal aggregate
principal amount of Definitive Notes of authorized denominations.
(iv)
Any Transfer Restricted Note delivered in exchange for an interest in a Global Note
pursuant to Section 2.2 shall, except as otherwise provided in Section 2.2, bear the Restricted Notes Legend.
(v)
Notwithstanding the foregoing, through the Restricted Period, a beneficial interest in a
Regulation S Global Note may be held only through Euroclear or Clearstream unless delivery is made in
accordance with the applicable provisions of Section 2.2.
(vi)
The holder of any Global Note may grant proxies and otherwise authorize any Person,
including Agent Members and Persons that may hold interests through Agent Members, to take any action
which a holder is entitled to take under this Indenture or the Notes.
Transfer and Exchange
2.2
.
(a)
Transfer and Exchange of Global Notes. A Global Note may not be transferred as a whole except as
set forth in Section 2.1(b). Global Notes will not be exchanged by the Issuer for Definitive Notes except under the
circumstances described in Section 2.1(b)(ii). Global Notes also may be exchanged or replaced, in whole or in part,
Appendix A-4
as provided in Section 2.08 of this Indenture. Beneficial interests in a Global Note may be transferred and exchanged
as provided in Section 2.2(b).
(b)
Transfer and Exchange of Beneficial Interests in Global Notes. The transfer and exchange of
beneficial interests in the Global Notes shall be effected through the Depository, in accordance with the provisions of
this Indenture and the applicable rules and procedures of the Depository. Beneficial interests in Transfer Restricted
Global Notes shall be subject to restrictions on transfer comparable to those set forth herein to the extent required by
the Securities Act. Beneficial interests in Global Notes shall be transferred or exchanged only for beneficial interests in
Global Notes. Transfers and exchanges of beneficial interests in the Global Notes also shall require compliance with
either subparagraph (i) or (ii) below, as applicable, as well as one or more of the other following subparagraphs, as
applicable:
(i)
Transfer of Beneficial Interests in the Same Global Note. Beneficial interests in any
Transfer Restricted Global Note may be transferred to Persons who take delivery thereof in the form of a
beneficial interest in the same Transfer Restricted Global Note in accordance with the transfer restrictions set
forth in the Restricted Notes Legend; provided, however, that prior to the expiration of the Restricted Period,
transfers of beneficial interests in a Regulation S Global Note may not be made to a U.S. Person or for the
account or benefit of a U.S. Person. A beneficial interest in an Unrestricted Global Note may be transferred
to Persons who take delivery thereof in the form of a beneficial interest in an Unrestricted Global Note. No
written orders or instructions shall be required to be delivered to the Registrar to effect the transfers described
in this Section 2.2(b)(i).
(ii)
All Other Transfers and Exchanges of Beneficial Interests in Global Notes. In connection
with all transfers and exchanges of beneficial interests in any Global Note that is not subject to Section 2.2(b)
(i), the transferor of such beneficial interest must deliver to the Registrar (1) a written order from an Agent
Member given to the Depository in accordance with the applicable rules and procedures of the Depository
directing the Depository to credit or cause to be credited a beneficial interest in another Global Note in an
amount equal to the beneficial interest to be transferred or exchanged and (2) instructions given in accordance
with the applicable rules and procedures of the Depository containing information regarding the Agent
Member account to be credited with such increase. Upon satisfaction of all of the requirements for transfer
or exchange of beneficial interests in Global Notes contained in this Indenture and the Notes or otherwise
applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Note
pursuant to Section 2.2(g).
(iii)
Transfer of Beneficial Interests to Another Restricted Global Note. A beneficial interest
in a Transfer Restricted Global Note may be transferred to a Person who takes delivery thereof in the form of
a beneficial interest in another Transfer Restricted Global Note if the transfer complies with the requirements
of Section 2.2(b)(ii) above and the Registrar receives the following:
Appendix A-5
(A)
if the transferee will take delivery in the form of a beneficial interest in a Rule
144A Global Note, then the transferor must deliver a certificate in the form attached to the
applicable Note;
(B)
if the transferee will take delivery in the form of a beneficial interest in a
Regulation S Global Note, then the transferor must deliver a certificate in the form attached to the
applicable Note; and
(C)
if the transferee will take delivery in the form of a beneficial interest in an IAI
Global Note, then the transferor must deliver a certificate in the form attached to the applicable
Note and an Opinion of Counsel, if applicable.
(iv)
Transfer and Exchange of Beneficial Interests in a Transfer Restricted Global Note for
Beneficial Interests in an Unrestricted Global Note. A beneficial interest in a Transfer Restricted Global Note
may be exchanged by any holder thereof for a beneficial interest in an Unrestricted Global Note or
transferred to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted
Global Note if the exchange or transfer complies with the requirements of Section 2.2(b)(ii) above and the
Registrar receives the following:
(A)
if the holder of such beneficial interest in a Transfer Restricted Global Note
proposes to exchange such beneficial interest for a beneficial interest in an Unrestricted Global
Note, a certificate from such holder in the form attached to the applicable Note; or
(B)
if the holder of such beneficial interest in a Transfer Restricted Global Note
proposes to transfer such beneficial interest to a Person who shall take delivery thereof in the form
of a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form
attached to the applicable Note,
and, in each such case, if the Issuer or the Registrar so request or if the applicable rules and
procedures of the Depository so require, an Opinion of Counsel in form reasonably acceptable to
the Issuer and the Registrar to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and in the Restricted Notes
Legend are no longer required in order to maintain compliance with the Securities Act. If any such
transfer or exchange is effected pursuant to this subparagraph (iv) at a time when an Unrestricted
Global Note has not yet been issued, the Issuer shall issue and, upon receipt of a written order of
the Issuer in the form of an Officer’s Certificate in accordance with Section 2.01 of this Indenture,
the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal
amount equal to the aggregate principal amount of beneficial interests transferred or exchanged
pursuant to this subparagraph (iv).
Appendix A-6
(v)
Transfer and Exchange of Beneficial Interests in an Unrestricted Global Note for
Beneficial Interests in a Transfer Restricted Global Note. Beneficial interests in an Unrestricted Global Note
cannot be exchanged for, or transferred to Persons who take delivery thereof in the form of, a beneficial
interest in a Transfer Restricted Global Note.
(c)
Transfer and Exchange of Beneficial Interests in Global Notes for Definitive Notes. A beneficial
interest in a Global Note may not be exchanged for a Definitive Note except under the circumstances described in
Section 2.1(b)(ii). A beneficial interest in a Global Note may not be transferred to a Person who takes delivery thereof
in the form of a Definitive Note except under the circumstances described in Section 2.1(b)(ii). In any case, beneficial
interests in Global Notes shall be transferred or exchanged only for Definitive Notes.
(d)
Transfer and Exchange of Definitive Notes for Beneficial Interests in Global Notes. Transfers and
exchanges of Definitive Notes for beneficial interests in the Global Notes also shall require compliance with either
subparagraph (i), (ii) or (iii) below, as applicable:
(i)
Transfer Restricted Definitive Notes to Beneficial Interests in Transfer Restricted Global
Notes. If any holder of a Transfer Restricted Definitive Note proposes to exchange such Transfer Restricted
Definitive Note for a beneficial interest in a Transfer Restricted Global Note or to transfer such Transfer
Restricted Definitive Note to a Person who takes delivery thereof in the form of a beneficial interest in a
Transfer Restricted Global Note, then, upon receipt by the Registrar of the following documentation:
(A)
if the holder of such Transfer Restricted Definitive Note proposes to exchange
such Transfer Restricted Note for a beneficial interest in a Transfer Restricted Global Note, a
certificate from such holder in the form attached to the applicable Note;
(B)
if such Transfer Restricted Definitive Note is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a certificate from such holder in the form
attached to the applicable Note;
(C)
if such Transfer Restricted Definitive Note is being transferred to a non-U.S.
Person in an offshore transaction in accordance with Rule 903 or Rule 904 under the Securities Act,
a certificate from such holder in the form attached to the applicable Note;
(D)
if such Transfer Restricted Definitive Note is being transferred pursuant to an
exemption from the registration requirements of the Securities Act, a certificate from such holder in
the form attached to the applicable Note and an Opinion of Counsel;
(E)
if such Transfer Restricted Definitive Note is being transferred to an IAI in
reliance on an exemption from the registration
Appendix A-7
requirements of the Securities Act other than those listed in subparagraphs (B) through (D) above, a
certificate from such holder in the form attached to the applicable Note, including the certifications,
certificates and Opinion of Counsel, if applicable; or
(F)
if such Transfer Restricted Definitive Note is being transferred to the Issuer or a
Subsidiary thereof, a certificate from such holder in the form attached to the applicable Note;
the Trustee shall cancel the Transfer Restricted Definitive Note, and increase or cause to be
increased the aggregate principal amount of the appropriate Transfer Restricted Global Note.
(ii)
Transfer Restricted Definitive Notes to Beneficial Interests in Unrestricted Global
Notes. A holder of a Transfer Restricted Definitive Note may exchange such Transfer Restricted Definitive
Note for a beneficial interest in an Unrestricted Global Note or transfer such Transfer Restricted Definitive
Note to a Person who takes delivery thereof in the form of a beneficial interest in an Unrestricted Global Note
only if the Registrar receives the following:
(A)
if the holder of such Transfer Restricted Definitive Note proposes to exchange
such Transfer Restricted Definitive Note for a beneficial interest in an Unrestricted Global Note, a
certificate from such holder in the form attached to the applicable Note; or
(B)
if the holder of such Transfer Restricted Definitive Note proposes to transfer
such Transfer Restricted Definitive Note to a Person who shall take delivery thereof in the form of
a beneficial interest in an Unrestricted Global Note, a certificate from such holder in the form
attached to the applicable Note,
and, in each such case, if the Issuer or the Registrar so request or if the applicable rules and
procedures of the Depository so require, an Opinion of Counsel in form reasonably acceptable to
the Issuer and the Registrar to the effect that such exchange or transfer is in compliance with the
Securities Act and that the restrictions on transfer contained herein and in the Restricted Notes
Legend are no longer required in order to maintain compliance with the Securities Act. Upon
satisfaction of the conditions of this subparagraph (ii), the Trustee shall cancel the Transfer
Restricted Definitive Note and increase or cause to be increased the aggregate principal amount of
the Unrestricted Global Note. If any such transfer or exchange is effected pursuant to this
subparagraph (ii) at a time when an Unrestricted Global Note has not yet been issued, the Issuer
shall issue and, upon receipt of a written order of the Issuer in the form of an Officer’s Certificate,
the Trustee shall authenticate one or more Unrestricted Global Notes in an aggregate principal
amount equal to the aggregate principal amount of the
Appendix A-8
Transfer Restricted Note transferred or exchanged pursuant to this subparagraph (ii).
(iii)
Unrestricted Definitive Notes to Beneficial Interests in Unrestricted Global Notes. A
holder of an Unrestricted Definitive Note may exchange such Unrestricted Definitive Note for a beneficial
interest in an Unrestricted Global Note or transfer such Unrestricted Definitive Note to a Person who takes
delivery thereof in the form of a beneficial interest in an Unrestricted Global Note at any time. Upon receipt
of a request for such an exchange or transfer, the Trustee shall cancel the applicable Unrestricted Definitive
Note and increase or cause to be increased the aggregate principal amount of one of the Unrestricted Global
Notes. If any such transfer or exchange is effected pursuant to this subparagraph (iii) at a time when an
Unrestricted Global Note has not yet been issued, the Issuer shall issue and, upon receipt of a written order of
the Issuer in the form of an Officer’s Certificate, the Trustee shall authenticate one or more Unrestricted
Global Notes in an aggregate principal amount equal to the aggregate principal amount of the Unrestricted
Definitive Note transferred or exchanged pursuant to this subparagraph (iii).
(iv)
Unrestricted Definitive Notes to Beneficial Interests in Transfer Restricted Global
Notes. An Unrestricted Definitive Note cannot be exchanged for, or transferred to a Person who takes
delivery thereof in the form of, a beneficial interest in a Transfer Restricted Global Note.
(e)
Transfer and Exchange of Definitive Notes for Definitive Notes. Upon request by a holder of
Definitive Notes and such holder’s compliance with the provisions of this Section 2.2(e), the Registrar shall register the
transfer or exchange of Definitive Notes. Prior to such registration of transfer or exchange, the requesting holder shall
present or surrender to the Registrar the Definitive Notes duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar duly executed by such holder or by its attorney, duly authorized in
writing. In addition, the requesting holder shall provide any additional certifications, documents and information, as
applicable, required pursuant to the following provisions of this Section 2.2(e).
(i)
Transfer Restricted Definitive Notes to Transfer Restricted Definitive Notes. A Transfer
Restricted Note may be transferred to and registered in the name of a Person who takes delivery thereof in the
form of a Transfer Restricted Definitive Note if the Registrar receives the following:
(A)
if the transfer will be made pursuant to Rule 144A under the Securities Act, then
the transferor must deliver a certificate in the form attached to the applicable Note;
(B)
if the transfer will be made pursuant to Rule 903 or Rule 904 under the Securities
Act, then the transferor must deliver a certificate in the form attached to the applicable Note;
Appendix A-9
(C)
if the transfer will be made pursuant to an exemption from the registration
requirements of the Securities Act, a certificate in the form attached to the applicable Note and an
Opinion of Counsel;
(D)
if the transfer will be made to an IAI in reliance on an exemption from the
registration requirements of the Securities Act other than those listed in subparagraphs (A) through
(C) above, a certificate in the form attached to the applicable Note; and
(E)
if such transfer will be made to the Issuer or a Subsidiary thereof, a certificate in
the form attached to the applicable Note.
(ii)
Transfer Restricted Definitive Notes to Unrestricted Definitive Notes. Any Transfer
Restricted Definitive Note may be exchanged by the holder thereof for an Unrestricted Definitive Note or
transferred to a Person who takes delivery thereof in the form of an Unrestricted Definitive Note if the
Registrar receives the following:
(A)
if the holder of such Transfer Restricted Definitive Note proposes to exchange
such Transfer Restricted Definitive Note for an Unrestricted Definitive Note, a certificate from
such holder in the form attached to the applicable Note; or
(B)
if the holder of such Transfer Restricted Definitive Note proposes to transfer
such Notes to a Person who shall take delivery thereof in the form of an Unrestricted Definitive
Note, a certificate from such holder in the form attached to the applicable Note,
and, in each such case, if the Issuer or the Registrar so request, an Opinion of Counsel in
form reasonably acceptable to the Issuer and the Registrar to the effect that such exchange or
transfer is in compliance with the Securities Act and that the restrictions on transfer contained
herein and in the Restricted Notes Legend are no longer required in order to maintain compliance
with the Securities Act.
(iii)
Unrestricted Definitive Notes to Unrestricted Definitive Notes. A holder of an
Unrestricted Definitive Note may transfer such Unrestricted Definitive Notes to a Person who takes delivery
thereof in the form of an Unrestricted Definitive Note at any time. Upon receipt of a request to register such
a transfer, the Registrar shall register the Unrestricted Definitive Notes pursuant to the instructions from the
holder thereof.
(iv)
Unrestricted Definitive Notes to Transfer Restricted Definitive Notes. An Unrestricted
Definitive Note cannot be exchanged for, or transferred to a Person who takes delivery thereof in the form of,
a Transfer Restricted Definitive Note.
Appendix A-10
At such time as all beneficial interests in a particular Global Note have been exchanged for
Definitive Notes or a particular Global Note has been redeemed, repurchased or canceled in whole and not in
part, each such Global Note shall be returned to or retained and canceled by the Trustee in accordance with
Section 2.10 of this Indenture. At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial
interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by such
Global Note shall be reduced accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depository at the direction of the Trustee to reflect such reduction; and if the beneficial
interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a
beneficial interest in another Global Note, such other Global Note shall be increased accordingly and an
endorsement shall be made on such Global Note by the Trustee or by the Depository at the direction of the
Trustee to reflect such increase.
(f)
Legend.
(i)
Except as permitted by the following paragraph (iii) or (iv), each Note certificate
evidencing the Global Notes and any Definitive Notes (and all Notes issued in exchange therefor or in
substitution thereof) shall bear a legend in substantially the following form (each defined term in the legend
being defined as such for purposes of the legend only):
“THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS
OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS SECURITY NOR
ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS SUCH
IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH
TRANSACTION
REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE
HEREOF, AGREES ON ITS OWN BEHALF AND ON BEHALF OF ANY INVESTOR
ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL OR
OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE
“RESALE RESTRICTION TERMINATION DATE”) THAT IS [IN THE CASE OF
RULE 144A NOTES: ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE
DATE HEREOF, THE ORIGINAL ISSUE DATE OF THE ISSUANCE OF ANY
ADDITIONAL NOTES AND THE LAST DATE ON WHICH THE ISSUER OR ANY
AFFILIATE OF THE ISSUER WAS THE OWNER OF THIS SECURITY (OR ANY
PREDECESSOR OF SUCH SECURITY),] [IN THE CASE OF REGULATION S
NOTES: 40 DAYS AFTER
Appendix A-11
THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE DATE ON
WHICH THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) WAS
FIRST OFFERED TO PERSONS OTHER THAN DISTRIBUTORS (AS DEFINED IN
RULE 902 OF REGULATION S UNDER THE SECURITIES ACT (“REGULATION
S”)) IN RELIANCE ON REGULATION S], ONLY (A) TO THE ISSUER OR ANY
SUBSIDIARY THEREOF, (B) PURSUANT TO A REGISTRATION STATEMENT
THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT,
(C) FOR SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”), TO A
PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL
BUYER” AS DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN
ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER
TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-
U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED STATES WITHIN THE
MEANING OF REGULATION S, (E) TO AN INSTITUTIONAL “ACCREDITED
INVESTOR” WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER
THE SECURITIES ACT THAT IS NOT A QUALIFIED INSTITUTIONAL BUYER
AND THAT IS PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT
OF ANOTHER INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A
MINIMUM PRINCIPAL AMOUNT OF SECURITIES OR (F) PURSUANT TO
REGISTRATION
ANOTHER AVAILABLE
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER’S AND
THE TRUSTEE’S RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
PURSUANT TO CLAUSE (C), (D), (E) OR (F) TO REQUIRE THE DELIVERY OF
AN OPINION OF COUNSEL, CERTIFICATION AND/ OR OTHER INFORMATION
SATISFACTORY TO EACH OF THEM. THIS LEGEND WILL BE REMOVED UPON
THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
TERMINATION DATE.
EXEMPTION
FROM
THE
BY ITS ACQUISITION OF THIS SECURITY, THE HOLDER HEREOF WILL BE
DEEMED TO HAVE REPRESENTED AND WARRANTED THAT EITHER (1) NO
PORTION OF THE ASSETS USED BY SUCH HOLDER TO ACQUIRE OR HOLD
THIS SECURITY CONSTITUTES THE ASSETS OF AN EMPLOYEE BENEFIT
PLAN THAT IS SUBJECT TO THE U.S. EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED (“ERISA”), A PLAN, INDIVIDUAL
Appendix A-12
RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT THAT IS
SUBJECT TO SECTION 4975 OF THE U.S. INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE “CODE”) OR PROVISIONS UNDER ANY OTHER FEDERAL,
STATE, LOCAL, NON-U.S. OR OTHER LAWS OR REGULATIONS THAT ARE
SIMILAR TO SUCH PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY,
“SIMILAR LAWS”), OR OF AN ENTITY WHOSE UNDERLYING ASSETS ARE
CONSIDERED TO INCLUDE “PLAN ASSETS” (WITHIN THE MEANING OF 29
C.F.R. SECTION 2510.3-101 (AS MODIFIED BY SECTION 3(42) OF ERISA)) OF
ANY SUCH PLAN, ACCOUNT OR ARRANGEMENT OR (2) THE ACQUISITION
AND HOLDING OF THIS SECURITY OR ANY INTEREST HEREIN BY IT WILL
NOT CONSTITUTE A NON-EXEMPT PROHIBITED TRANSACTION UNDER
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE OR A SIMILAR
VIOLATION UNDER ANY APPLICABLE SIMILAR LAW, AND NONE OF THE
ISSUER, THE INITIAL PURCHASER, ANY GUARANTOR OR ANY OF THEIR
RESPECTIVE AFFILIATES IS ACTING, OR WILL ACT, AS ITS FIDUCIARY, OR IS
UNDERTAKING TO PROVIDE OR BEING RELIED UPON FOR ANY ADVICE,
WITH RESPECT TO THE DECISION TO ACQUIRE AND HOLD THE
SECURITIES.”
Each Regulation S Note shall bear the following additional legend:
“BY ITS ACQUISITION HEREOF, THE HOLDER HEREOF REPRESENTS THAT IT
IS NOT A U.S. PERSON NOR IS IT PURCHASING FOR THE ACCOUNT OF A U.S.
PERSON AND
IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH REGULATION S.”
IS ACQUIRING THIS SECURITY
Each Global Note shall bear the following additional legend:
UNLESS THIS CERTIFICATE
IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND
ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
SUCH OTHER NAME AS
IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR
TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF
Appendix A-13
FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN
WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A
SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS
OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE
INDENTURE REFERRED TO ON THE REVERSE HEREOF.
Each Definitive Note shall bear the following additional legend:
“IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO
THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER
INFORMATION AS SUCH TRANSFER AGENT MAY REASONABLY REQUIRE TO
CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING
RESTRICTIONS.”
Each Note issued with original issue discount shall bear the following legend:
“THIS NOTE HAS BEEN ISSUED WITH “ORIGINAL ISSUE DISCOUNT” (WITHIN
THE MEANING OF SECTION 1272 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED). UPON WRITTEN REQUEST, THE COMPANY WILL
PROMPTLY MAKE AVAILABLE TO ANY HOLDER OF THIS NOTE THE
FOLLOWING INFORMATION: (1) THE ISSUE PRICE AND DATE OF THE NOTE;
(2) THE AMOUNT OF ORIGINAL ISSUE DISCOUNT ON THE NOTE; AND (3)
THE YIELD TO MATURITY OF THE NOTE. HOLDERS SHOULD CONTACT THE
COMPANY AT 18100 VON KARMAN AVENUE, SUITE 1000,
IRVINE,
CALIFORNIA 92612, ATTENTION: CHIEF FINANCIAL OFFICER.”
(ii)
Upon any sale or transfer of a Transfer Restricted Definitive Note, the Registrar shall
permit the holder thereof to exchange such Transfer Restricted Note for a Definitive Note that does not bear
the legends set forth above and rescind any restriction on the transfer of such Transfer Restricted Definitive
Note if the holder certifies in writing to the Registrar that its request for such exchange was made in reliance
on Rule 144 (such certification to be in the form set forth on the reverse of the Initial Note).
Appendix A-14
(iii)
Upon a sale or transfer after the expiration of the Restricted Period of any Initial Note
acquired pursuant to Regulation S, all requirements that such Initial Note bear the Restricted Notes Legend
shall cease to apply and the requirements requiring any such Initial Note be issued in global form shall
continue to apply.
(iv)
Any Additional Notes sold in a registered offering shall not be required to bear the
Restricted Notes Legend.
(g)
Cancellation or Adjustment of Global Note. At such time as all beneficial interests in a particular
Global Note have been exchanged for Definitive Notes or a particular Global Note has been redeemed, repurchased or
canceled in whole and not in part, each such Global Note shall be returned to or retained and canceled by the Trustee in
accordance with Section 2.10 of this Indenture. At any time prior to such cancellation, if any beneficial interest in a
Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial
interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by such Global Note
shall be reduced accordingly and an endorsement shall be made on such Global Note by the Trustee or by the
Depository at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for
or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note,
such other Global Note shall be increased accordingly and an endorsement shall be made on such Global Note by the
Trustee or by the Depository at the direction of the Trustee to reflect such increase.
(h)
Obligations with Respect to Transfers and Exchanges of Notes.
(i)
To permit registrations of transfers and exchanges, the Issuer shall execute and the Trustee
shall authenticate, Definitive Notes and Global Notes at the Registrar’s request.
(ii)
No service charge shall be made for any registration of transfer or exchange of Notes, but
the Issuer may require payment of a sum sufficient to cover any transfer tax, assessments, or similar
governmental charge payable in connection therewith (other than any such transfer taxes, assessments or
similar governmental charge payable upon exchanges pursuant to Sections 3.08, 4.06, 4.08 and 9.04 of this
Indenture).
(iii)
Prior to the due presentation for registration of transfer of any Note, the Issuer, the
Trustee, a Paying Agent or the Registrar may deem and treat the person in whose name a Note is registered as
the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such
Note and for all other purposes whatsoever, whether or not such Note is overdue, and none of the Issuer, the
Trustee, the Paying Agent or the Registrar shall be affected by notice to the contrary.
(iv)
All Notes issued upon any transfer or exchange pursuant to the terms of this Indenture
shall evidence the same debt and shall be entitled to the same
Appendix A-15
benefits under this Indenture as the Notes surrendered upon such transfer or exchange.
Neither the Registrar nor the Issuer will be required:
(A)
to issue, to register the transfer of, or to exchange any Notes during a period beginning at
the opening of business 15 days before the day of any selection of Notes for redemption under Section 3.04
herein and ending at the close of business on the day of selection;
(B)
to register the transfer of or to exchange any Note selected for redemption in whole or in
part, except the unredeemed portion of any Note being redeemed in part; or
(C)
to register the transfer of or to exchange a Note between a record date and the next
succeeding Interest Payment Date.
(i)
No Obligation of the Trustee or the Issuer.
(i)
Neither the Trustee nor the Issuer shall have any responsibility or obligation to any
beneficial owner of a Global Note, a member of, or a participant in the Depository or any other Person with
respect to the accuracy of the records of the Depository or its nominee or of any participant or member
thereof, with respect to any ownership interest in the Notes or with respect to the delivery to any participant,
member, beneficial owner or other Person (other than the Depository) of any notice (including any notice of
redemption or repurchase) or the payment of any amount, under or with respect to such Notes. All notices
and communications to be given to the holders and all payments to be made to the holders under the Notes
shall be given or made only to the registered holders (which shall be the Depository or its nominee in the case
of a Global Note). The rights of beneficial owners in any Global Note shall be exercised only through the
Depository subject to the applicable rules and procedures of the Depository. The Trustee and the Issuer may
rely and shall be fully protected in relying upon information furnished by the Depository with respect to its
members, participants and any beneficial owners.
(ii)
Neither the Trustee nor the Issuer shall have any obligation or duty to monitor, determine
or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable
law with respect to any transfer of any interest in any Note (including any transfers between or among
Depository participants, members or beneficial owners in any Global Note) other than to require delivery of
such certificates and other documentation or evidence as are expressly required by, and to do so if and when
expressly required by, the terms of this Indenture, and to examine the same to determine substantial
compliance as to form with the express requirements hereof.
Appendix A-16
[FORM OF FACE OF INITIAL NOTE]
[Global Notes Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO., OR TO SUCH
OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART,
TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND
TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE
WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.
[Restricted Notes Legend for Notes Offered in Reliance on Regulation S]
BY ITS ACQUISITION HEREOF, THE HOLDER HEREOF REPRESENTS THAT IT IS NOT A U.S. PERSON
NOR IS IT PURCHASING FOR THE ACCOUNT OF A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH REGULATION S.
[Restricted Notes Legend]
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE OR OTHER JURISDICTION. NEITHER THIS
SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED,
TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO, SUCH
REGISTRATION. THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES ON ITS OWN BEHALF
AND ON BEHALF OF ANY INVESTOR ACCOUNT FOR WHICH IT HAS PURCHASED SECURITIES, TO OFFER, SELL
OR OTHERWISE TRANSFER SUCH SECURITY, PRIOR TO THE DATE (THE “RESALE RESTRICTION TERMINATION
DATE”) THAT IS [IN THE CASE OF RULE 144A NOTES: ONE YEAR AFTER THE LATER OF THE ORIGINAL ISSUE
DATE HEREOF, THE ORIGINAL ISSUE DATE OF THE ISSUANCE OF ANY ADDITIONAL NOTES AND THE LAST
DATE ON WHICH THE ISSUER OR ANY AFFILIATE OF THE ISSUER WAS THE
OWNER OF THIS SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY),] [IN THE CASE OF REGULATION S
NOTES: 40 DAYS AFTER THE LATER OF THE ORIGINAL ISSUE DATE HEREOF AND THE DATE ON WHICH THIS
SECURITY (OR ANY PREDECESSOR OF SUCH SECURITY) WAS FIRST OFFERED TO PERSONS OTHER THAN
DISTRIBUTORS (AS DEFINED IN RULE 902 OF REGULATION S UNDER THE SECURITIES ACT (“REGULATION S”))
IN RELIANCE ON REGULATION S], ONLY (A) TO THE ISSUER OR ANY SUBSIDIARY THEREOF, (B) PURSUANT TO
A REGISTRATION STATEMENT THAT HAS BEEN DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR
SO LONG AS THE SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A UNDER THE SECURITIES
ACT (“RULE 144A”), TO A PERSON IT REASONABLY BELIEVES IS A “QUALIFIED INSTITUTIONAL BUYER” AS
DEFINED IN RULE 144A THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR OUTSIDE THE UNITED
STATES WITHIN THE MEANING OF REGULATION S, (E) TO AN INSTITUTIONAL “ACCREDITED INVESTOR”
WITHIN THE MEANING OF RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT THAT IS NOT A
QUALIFIED INSTITUTIONAL BUYER AND THAT IS PURCHASING FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF ANOTHER INSTITUTIONAL ACCREDITED INVESTOR, IN EACH CASE IN A MINIMUM PRINCIPAL
AMOUNT OF SECURITIES OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, SUBJECT TO THE ISSUER’S AND THE TRUSTEE’S RIGHT PRIOR TO
ANY SUCH OFFER, SALE OR TRANSFER PURSUANT TO CLAUSE (C), (D), (E) OR (F) TO REQUIRE THE DELIVERY
OF AN OPINION OF COUNSEL, CERTIFICATION AND/ OR OTHER INFORMATION SATISFACTORY TO EACH OF
THEM. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE
RESTRICTION TERMINATION DATE.
BY ITS ACQUISITION OF THIS SECURITY, THE HOLDER HEREOF WILL BE DEEMED TO HAVE
REPRESENTED AND WARRANTED THAT EITHER (1) NO PORTION OF THE ASSETS USED BY SUCH HOLDER TO
ACQUIRE OR HOLD THIS SECURITY CONSTITUTES THE ASSETS OF AN EMPLOYEE BENEFIT PLAN THAT IS
SUBJECT TO THE U.S. EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”), A
PLAN, INDIVIDUAL RETIREMENT ACCOUNT OR OTHER PLAN OR ARRANGEMENT THAT IS SUBJECT TO
SECTION 4975 OF THE U.S. INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”) OR PROVISIONS
UNDER ANY OTHER FEDERAL, STATE, LOCAL, NON-U.S. OR OTHER LAWS OR REGULATIONS THAT ARE
SIMILAR TO SUCH PROVISIONS OF ERISA OR THE CODE (COLLECTIVELY, “SIMILAR LAWS”), OR OF AN ENTITY
WHOSE UNDERLYING ASSETS ARE CONSIDERED TO INCLUDE “PLAN ASSETS” (WITHIN THE MEANING OF 29
C.F.R. SECTION 2510.3-101 (AS MODIFIED BY SECTION 3(42) OF ERISA)) OF ANY SUCH PLAN, ACCOUNT OR
ARRANGEMENT OR (2) THE ACQUISITION AND HOLDING OF THIS SECURITY OR INTEREST HEREIN BY IT
WILL NOT CONSTITUTE A NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR
SECTION 4975 OF THE CODE OR A SIMILAR VIOLATION UNDER ANY APPLICABLE SIMILAR LAW, AND NONE
OF THE ISSUER, THE INITIAL PURCHASER, ANY
Exhibit A-2
GUARANTOR OR ANY OF THEIR RESPECTIVE AFFILIATES IS ACTING, OR WILL ACT, AS ITS FIDUCIARY, OR IS
UNDERTAKING TO PROVIDE OR BEING RELIED UPON FOR ANY ADVICE, WITH RESPECT TO THE DECISION TO
ACQUIRE AND HOLD THE SECURITIES.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND
TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH TRANSFER AGENT MAY
REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS
[Definitive Note Legend]
Exhibit A-3
[FORM OF INITIAL NOTE]
PEARL MERGER SUB INC. (to be merged with and into DOMTAR CORPORATION)
No. [ ]
144A CUSIP No. 70478J AA2
144A ISIN No. US70478JAA25
REG S CUSIP No. U7051J AA6
REG S ISIN No. USU7051JAA61
$[ ]
6.750% Senior Secured Note due 2028
Pearl Merger Sub Inc., a newly formed corporation formed under the laws of Delaware (together with its successors
and assigns under the Indenture, including, without limitation, Domtar Corporation, a Delaware corporation), promises to pay to
Cede & Co., or its registered assigns, the principal sum of [ ] (as such sum may be increased or decreased as set forth
on the Schedule of Increases or Decreases in Global Note attached hereto) on October 1, 2028.
Interest Payment Dates: April 1 and October 1, commencing [ ]1
Record Dates: March 15 and September 15
Additional provisions of this Note are set forth on the other side of this Note.
IN WITNESS WHEREOF, the parties have caused this instrument to be duly executed.
1 To be April 1, 2022 for Initial Notes.
Exhibit A-4
Dated:
PEARL MERGER SUB INC.
By:
Name:
Title:
Exhibit A-5
TRUSTEE’S CERTIFICATE OF
AUTHENTICATION
THE BANK OF NEW YORK MELLON
as Trustee, certifies that this is
one of the Notes
referred to in the Indenture.
By:
Authorized Signatory
Dated:
*/
If the Note is to be issued in global form, add the Global Notes Legend and the attachment from Exhibit A captioned
“TO BE ATTACHED TO GLOBAL NOTES - SCHEDULE OF INCREASES OR DECREASES IN GLOBAL
NOTE.”
Exhibit A-6
[FORM OF REVERSE SIDE OF INITIAL NOTE]
6.750% Senior Secured Note Due 2028
1.
Interest
Pearl Merger Sub Inc., a newly formed corporation formed under the laws of Delaware (such entity, and its successors
and assigns under the Indenture, including, without limitation, Domtar Corporation, a Delaware corporation, hereinafter referred
to as the “Issuer”), promises to pay interest on the principal amount of this Note at the rate per annum shown above. The Issuer
shall pay interest semiannually on April 1 and October 1 of each year (each an “Interest Payment Date”), commencing [
]2. Interest on the Notes shall accrue from the most recent date to which interest has been paid or duly provided for or, if no
interest has been paid or duly provided for, from October 18, 2021, until the principal hereof is due. Interest shall be computed
on the basis of a 360-day year of twelve 30-day months. The Issuer shall pay interest on overdue principal at the rate 1.00% per
annum, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.
2.
Method of Payment
The Issuer shall pay interest on the Notes (except defaulted interest) to the Persons who are registered holders at the
close of business on each March 15 and September 15 (whether or not a Business Day) (each a “Record Date”) immediately
preceding each Interest Payment Date, even if Notes are canceled after the Record Date and on or before the Interest Payment
Date. Holders must surrender Notes to the Paying Agent to collect principal payments. The Issuer shall pay principal, premium,
if any, and interest in money of the United States of America that at the time of payment is legal tender for payment of public and
private debts. Payments in respect of the Notes represented by a Global Note (including principal, premium, if any, and interest)
shall be made by wire transfer of immediately available funds to the accounts specified by The Depository Trust Company or any
successor depositary. The Issuer shall make all payments in respect of a certificated Note (including principal, premium, if any,
and interest) at the office of the Paying Agent, except that, at the option of the Issuer, payment of interest may be made by
mailing a check to the registered address of each holder thereof; provided, however, that payments on the Notes may also be
made, in the case of a holder of at least $1,000,000 aggregate principal amount of Notes, by wire transfer to a U.S. dollar account
maintained by such holder with a bank in the United States of America if such holder elects payment by wire transfer by giving
written notice to the Trustee (as defined below) or Paying Agent to such effect, and designating such account, no later than 30
days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).
3.
Paying Agent and Registrar
Initially, The Bank of New York Mellon, as trustee under the Indenture (the “
2 To be April 1, 2022 for Initial Notes.
Exhibit A-7
Trustee”), will act as Paying Agent and Registrar. The Issuer may appoint and change any Paying Agent or Registrar upon
written notice to such Paying Agent or Registrar and to the Trustee. The Issuer or any of its domestically incorporated Restricted
Subsidiaries may act as Paying Agent or Registrar.
4.
Indenture
The Issuer issued the Notes under an Indenture dated as of October 18, 2021 (as amended and/or supplemented from
time to time, the “Indenture”), among the Issuer, the Guarantors party thereto from time to time, the Trustee and The Bank of
New York Mellon, as Collateral Agent. Capitalized terms used herein are used as defined in the Indenture, unless otherwise
indicated. The terms of the Notes include those stated in the Indenture. The Notes are subject to all terms and provisions of the
Indenture, and the holders (as defined in the Indenture) are referred to the Indenture for a statement of such terms and
provisions. If and to the extent that any provision of the Notes limits, qualifies or conflicts with a provision of the Indenture,
such provision of the Indenture shall control.
The Notes are senior secured obligations of the Issuer. This Note is one of the Initial Notes referred to in the
Indenture. The Notes include the Initial Notes and any Additional Notes. The Indenture imposes certain limitations on the
ability of the Issuer and its Restricted Subsidiaries to, among other things, make certain Investments and other Restricted
Payments, Incur Indebtedness, enter into consensual restrictions upon the payment of certain dividends and distributions by such
Restricted Subsidiaries, issue or sell shares of certain capital stock of the Issuer and such Restricted Subsidiaries, enter into or
permit certain transactions with Affiliates, create or Incur Liens and make Asset Sales. The Indenture also imposes limitations on
the ability of the Issuer and each Guarantor to consolidate or merge with or into any other Person or convey, transfer or lease all
or substantially all of its property.
To guarantee the due and punctual payment of the principal and interest on the Notes and all other amounts payable by
the Issuer under the Indenture and the Notes when and as the same shall be due and payable, whether at maturity, by acceleration
or otherwise, according to the terms of the Notes and the Indenture, the Guarantors have unconditionally guaranteed the
Guaranteed Obligations pursuant to the terms of the Indenture and any Guarantor that executes a Guarantee will unconditionally
guarantee the Guaranteed Obligations on a senior secured basis, pursuant to the terms of the Indenture.
5.
Redemption
On or after October 1, 2024, the Issuer may redeem the Notes at its option, in whole at any time or in part from time to
time, upon notice as described in Paragraph 7 of this Note, at the following redemption prices (expressed as a percentage of
principal amount), plus accrued and unpaid interest, if any, to, but excluding, the redemption date (subject to the right of holders
of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date), if redeemed during the 12-
month period commencing on October 1 of the years set forth below:
Period
2024
2025
2026 and thereafter
Redemption Price
103.375%
101.688%
100.000%
Exhibit A-8
In addition, prior to October 1, 2024, the Issuer may redeem the Notes at its option, in whole at any time or in part from
time to time, upon notice as described in Paragraph 7 of this Note, at a redemption price equal to 100% of the principal amount of
the Notes redeemed plus the Applicable Premium as of, and accrued and unpaid interest, if any, to, but excluding, the redemption
date (subject to the right of holders of record on the relevant Record Date to receive interest due on the relevant Interest Payment
Date).
Prior to October 1, 2024, the Issuer may redeem during each calendar year commencing with the calendar year in
which the Issue Date occurs up to 10% of the original aggregate principal amount of the Notes (including additional notes), at its
option, from time to time at a redemption price equal to 103% of the aggregate principal amount of the Notes redeemed, plus
accrued and unpaid interest, if any, to, but excluding, the redemption date (subject to the right of holders of record on the relevant
record date to receive interest due on the relevant interest payment date); provided that in any given calendar year, any amount
not utilized pursuant to this paragraph may be carried forward to subsequent calendar years and may be used in such calendar
year prior to utilizing the capacity in this paragraph for such calendar year.
Notwithstanding the foregoing, at any time and from time to time prior to October 1, 2024, the Issuer may redeem in
the aggregate up to 40% of the original aggregate principal amount of the Notes (calculated after giving effect to any issuance of
Additional Notes) in an amount not to exceed the amount of cash proceeds less underwriting fees paid in cash of one or more
Equity Offerings (1) by the Issuer or (2) by any Parent Entity to the extent such cash proceeds less underwriting fees paid in cash
are contributed to the common equity capital of the Issuer or used to purchase Capital Stock (other than Disqualified Stock) of
the Issuer, at a redemption price (expressed as a percentage of principal amount thereof) of 106.750%, plus accrued and unpaid
interest, if any, to, but excluding, the redemption date (subject to the right of holders of record on the relevant Record Date to
receive interest due on the relevant Interest Payment Date); provided, that at least 50% of the original aggregate principal amount
of the Notes issued under the Indenture remains outstanding immediately after the occurrence of such redemption (except to the
extent otherwise repurchased or redeemed substantially contemporaneously in accordance with the terms of the Indenture).
Notice of any redemption upon any transaction or event (including any Equity Offering, Incurrence of Indebtedness,
Change of Control or other transaction) may be given prior to the completion thereof. In addition, any redemption or notice
thereof may, at the Issuer’s discretion, be subject to one or more conditions precedent, including, but not limited to, completion of
a transaction or other event.
At any time, in connection with any offer to purchase the Notes (including pursuant to any tender offer, a Change of
Control Offer, Alternate Offer or Asset Sale Offer), if holders of not less than 90% in aggregate principal amount of the
outstanding Notes are purchased by the Issuer, or any third party purchasing or acquiring in lieu of the Issuer, all of the holders of
the Notes will be deemed to have consented to such tender or other offer and accordingly, the Issuer or such third party will have
the right, upon notice as described in Paragraph 7 of this Note, to redeem all Notes that remain outstanding following such
purchase at the same price offered to such holders in such purchase.
Exhibit A-9
The Notes of any series may be optionally redeemed in whole or in part pursuant to Sections 3.01 and 3.05 of the
Indenture before the Notes of any other series are optionally redeemed in whole (or at all) pursuant to Sections 3.01 and 3.05 of
the Indenture.
6.
Mandatory Redemptions
Other than with respect to a Special Mandatory Redemption pursuant to Section 3.10 of the Indenture or a Special
Change of Control Mandatory Redemption pursuant to Section 3.11 of the Indenture, the Issuer will not be required to make any
mandatory redemption or sinking fund payments with respect to the Notes.
7.
8.
Notice of Redemption
Notices for redemption shall be given as set forth in Section 3.05 of the Indenture.
Repurchase of Notes at the Option of the Holders upon Change of Control and Asset Sales
If a Change of Control occurs, the Issuer may be required to offer to repurchase the Notes as required by the Indenture.
Following the occurrence of certain Asset Sales, the Issuer may be required to offer to repurchase the Notes as required
by the Indenture.
9.
Denominations; Transfer; Exchange
The Notes are in registered form, without coupons, in minimum denominations of $2,000 principal amount and integral
multiples of $1,000 in excess thereof. A holder shall register the transfer of or exchange of the Notes in accordance with the
Indenture. Upon any registration of transfer or exchange, the Registrar and the Trustee may require a holder, among other things,
to furnish appropriate endorsements or transfer documents and to pay any taxes required by law or permitted by the
Indenture. The Registrar need not register the transfer of or exchange any Notes selected for redemption (except, in the case of a
Note to be redeemed in part, the portion of the Note not to be redeemed) or to transfer or exchange any Notes for a period of 15
days prior to a selection of Notes to be redeemed or between a Record Date and the relevant Interest Payment Date.
10.
Persons Deemed Owners
The registered holder of this Note shall be treated as the owner of it for all purposes.
11.
Unclaimed Money
If money for the payment of principal or interest remains unclaimed for two years, the Trustee and each Paying Agent
shall pay the money back to the Issuer at its written request unless an applicable abandoned property law designates another
Person. After any such payment, the holders entitled to the money must look to the Issuer for payment as general creditors and
the Trustee and each Paying Agent shall have no further liability with respect to such monies.
Exhibit A-10
12.
Discharge and Defeasance
Subject to certain conditions, the Issuer at any time may terminate some of or all its obligations under the Notes, the
Indenture and the Security Documents if the Issuer deposits with the Trustee money or U.S. Government Obligations for the
payment of principal, premium (if any) and interest on the Notes to redemption or maturity, as the case may be.
13.
Amendment; Waiver
Subject to certain exceptions, the Indenture, the Notes or any guarantee may be amended, supplemented or waived in
accordance with Article IX of the Indenture.
14.
Defaults and Remedies
The Notes are subject to the Defaults and Events of Default set forth in Article VI of the Indenture. The Issuer is
required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Issuer is required, upon
becoming aware of any Default or Event of Default (unless such Default or Event of Default has been cured or waived), to
deliver to the Trustee a statement specifying such Default or Event of Default as further provided in Section 4.09 of the
Indenture.
15.
Trustee and Collateral Agent Dealings with the Issuer
The Trustee or the Collateral Agent under the Indenture, in its individual or any other capacity, may become the owner
or pledgee of Notes and may otherwise deal with and collect obligations owed to it by the Issuer or its Affiliates and may
otherwise deal with the Issuer or its Affiliates with the same rights it would have if it were not the Trustee or the Collateral
Agent.
16.
No Recourse Against Others
No director, officer, employee, manager, independent contractor, consultant, distributor, incorporator or holder of any
Equity Interests in the Issuer, any Subsidiary or any Parent Entity, as such, will have any liability for any obligations of the Issuer
or any Guarantor under the Notes, the Indenture the Guarantees or the Security Documents, as applicable, or for any claim based
on, in respect of, or by reason of, such obligations or their creation. Each holder of Notes by accepting a Note waives and
releases all such liability.
17.
Authentication
This Note shall not be valid until an authorized signatory of the Trustee (or an authenticating agent) manually signs the
certificate of authentication on the other side of this Note.
18.
Abbreviations
Customary abbreviations may be used in the name of a holder or an assignee, such as TEN COM (=tenants in
common), TEN ENT (=tenants by the entireties), JT TEN (=joint tenants with rights of survivorship and not as tenants in
common), CUST (=custodian), and U/G/M/A (=Uniform Gift to Minors Act).
Exhibit A-11
19.
Governing Law
THIS SECURITY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF
THE STATE OF NEW YORK.
20.
CUSIP Numbers; ISINs
The Issuer has caused CUSIP numbers and ISINs to be printed on the Notes and have directed the Trustee to use
CUSIP numbers and ISINs in notices of redemption as a convenience to the holders. No representation is made as to the
accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed
only on the other identification numbers placed thereon.
21.
Security
The Notes shall be secured by first-priority Liens in the Fixed Asset Collateral and second-priority Liens in the Current
Asset Collateral, in each case subject to Permitted Liens, on the terms and conditions set forth in the Indenture, the Security
Documents and the Intercreditor Agreements. The Collateral Agent holds a Lien in the Collateral for the benefit of the Trustee
and the holders, in each case pursuant to the Security Documents.
The Issuer will furnish to any holder of Notes upon written request and without charge to the holder a copy of
the Indenture which has in it the text of this Note.
Exhibit A-12
To assign this Note, fill in the form below:
I or we assign and transfer this Note to:
ASSIGNMENT FORM
(Print or type assignee’s name, address and zip code)
(Insert assignee’s soc. sec. or tax I.D. No.)
and irrevocably appoint agent to transfer this Note on the books of the Issuer. The agent may substitute another to act for him.
Date:
Signature:
Your
Sign exactly as your name appears on the other side of this Note.
Signature Guarantee:
Date:
Signature must be guaranteed by a
participant
in a recognized signature
guaranty medallion program or other
signature guarantor program reasonably
acceptable to the Trustee
Signature of Signature Guarantee
Exhibit A-13
CERTIFICATE TO BE DELIVERED UPON EXCHANGE
OR REGISTRATION OF TRANSFER RESTRICTED NOTES
This certificate relates to $_________ principal amount of Notes held in (check applicable space) ____ book-entry or _____
definitive form by the undersigned.
The undersigned (check one box below):
☐
☐
has requested the Trustee by written order to deliver in exchange for its beneficial interest in the Global Note held by
the Depository a Note or Notes in definitive, registered form of authorized denominations and an aggregate principal
amount equal to its beneficial interest in such Global Note (or the portion thereof indicated above);
has requested the Trustee by written order to exchange or register the transfer of a Note or Notes.
In connection with any transfer of any of the Notes evidenced by this certificate occurring while this Note is still a Transfer
Restricted Definitive Note or a Transfer Restricted Global Note, the undersigned confirms that such Notes are being transferred
in accordance with its terms:
CHECK ONE BOX BELOW
(1)
(2)
(3)
(4)
☐
☐
☐
☐
(5)
☐
(6)
(7)
☐
☐
to the Issuer; or
to the Registrar for registration in the name of the holder, without transfer; or
pursuant to an effective registration statement under the Securities Act of 1933; or
inside the United States to a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act of
1933) that purchases for its own account or for the account of a qualified institutional buyer to whom notice is
given that such transfer is being made in reliance on Rule 144A, in each case pursuant to and in compliance with
Rule 144A under the Securities Act of 1933; or
outside the United States in an offshore transaction within the meaning of Regulation S under the Securities Act
in compliance with Rule 904 under the Securities Act of 1933 and such Note shall be held immediately after the
transfer through Euroclear or Clearstream until the expiration of the Restricted Period (as defined in the
Indenture); or
to an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of
1933) that has furnished to the Trustee a signed letter containing certain representations and agreements; or
pursuant to another available exemption from registration provided by Rule 144 under the Securities Act of
1933.
Exhibit A-14
Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name
of any Person other than the registered holder thereof; provided, however, that if box (5), (6) or (7) is checked, the Issuer or the
Trustee may require, prior to registering any such transfer of the Notes, such legal opinions, certifications and other information
as the Issuer or the Trustee have reasonably requested to confirm that such transfer is being made pursuant to an exemption from,
or in a transaction not subject to, the registration requirements of the Securities Act of 1933.
Date:
Signature:
Your
Sign exactly as your name appears on the other side of this Note.
Signature Guarantee:
Date:
Signature must be guaranteed by a
participant
in a recognized signature
guaranty medallion program or other
signature guarantor program reasonably
acceptable to the Trustee
Signature of Signature Guarantee
Exhibit A-15
TO BE COMPLETED BY PURCHASER IF (4) ABOVE IS CHECKED.
The undersigned represents and warrants that it is purchasing this Note for its own account or an account with respect
to which it exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the
meaning of Rule 144A under the Securities Act of 1933, and is aware that the sale to it is being made in reliance on Rule 144A
and acknowledges that it has received such information regarding the Issuer as the undersigned has requested pursuant to Rule
144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned’s
foregoing representations in order to claim the exemption from registration provided by Rule 144A.
Date:
NOTICE: To be executed by an executive officer
Exhibit A-16
[TO BE ATTACHED TO GLOBAL NOTES]
SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTE
The initial principal amount of this Global Note is $______________. The following increases or decreases in this
Global Note have been made:
Date of Exchange
Amount of decrease in
Principal Amount of
this Global Note
Amount of increase in
Principal Amount of
this Global Note
Principal amount of this
Global Note following
such decrease or
increase
Signature of authorized
signatory of Trustee or
Notes Custodian
Exhibit A-17
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuer pursuant to Section 4.06 (Asset Sales) or 4.08 (Change of
Control) of the Indenture, check the box:
Asset Sale ☐
Change of Control ☐
If you want to elect to have only part of this Note purchased by the Issuer pursuant to Section 4.06 (Asset Sales) or 4.08
(Change of Control) of the Indenture, state the amount ($2,000 or any integral multiple of $1,000 in excess thereof):
$
Date:
Signature:
Signature Guarantee:
Your
(Sign exactly as your name appears on the
other side of this Note)
Signature must be guaranteed by a participant in a recognized signature guaranty
medallion program or other signature guarantor program reasonably acceptable to the
Trustee
Exhibit A-18
[FORM OF TRANSFEREE LETTER OF REPRESENTATION]
EXHIBIT B
TRANSFEREE LETTER OF REPRESENTATION
The Bank of New York Mellon
240 Greenwich Street, Floor 7E
Attention: Corporate Trust
New York, New York 10286
Tel: (212) 815-3114
Ladies and Gentlemen:
This certificate is delivered to request a transfer of $[ ] principal amount of the 6.750% Senior Secured Notes due 2028
(the “Notes”) of Pearl Merger Sub Inc. (to be merged with and into Domtar Corporation, and collectively with its successors and
assigns, the “Issuer”).
Upon transfer, the Notes would be registered in the name of the new beneficial owner as follows:
Name:
Address:
Taxpayer ID Number:
The undersigned represents and warrants to you that:
(1)
We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities
Act of 1933, as amended (the “Securities Act”)), purchasing for our own account or for the account of such an institutional
“accredited investor” at least $100,000 principal amount of the Notes, and we are acquiring the Notes not with a view to, or for
offer or sale in connection with, any distribution in violation of the Securities Act. We have such knowledge and experience in
financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we invest in
or purchase securities similar to the Notes in the normal course of our business. We, and any accounts for which we are acting,
are each able to bear the economic risk of our or its investment.
(2)
We understand that the Notes have not been registered under the Securities Act and, unless so registered,
may not be sold except as permitted in the following sentence. We agree on our own behalf and on behalf of any investor
account for which we are purchasing Notes to offer, sell or otherwise transfer such Notes prior to the date that is one year after
the later of the date of original issue and the last date on which either of the Issuer or any affiliate of the Issuer was the owner of
such Notes (or any predecessor thereto) (the “Resale Restriction Termination Date”) only (a) in the United States to a person
whom we reasonably believe is a qualified institutional buyer (as defined in rule 144A under the Securities Act) in a transaction
meeting the requirements of Rule 144A, (b) outside the United States in an offshore transaction in accordance with Rule 904
Exhibit B-1
of Regulation S under the Securities Act, (c) pursuant to an exemption from registration under the Securities Act provided by
Rule 144 thereunder (if applicable) or (d) pursuant to an effective registration statement under the Securities Act, in each of cases
(a) through (d) in accordance with any applicable securities laws of any state of the United States. In addition, we will, and each
subsequent holder is required to, notify any purchaser of the Note evidenced hereby of the resale restrictions set forth above. The
foregoing restrictions on resale will not apply subsequent to the Resale Restriction Termination Date. If any resale or other
transfer of the Notes is proposed to be made to an institutional “accredited investor” prior to the Resale Restriction Termination
Date, the transferor shall deliver a letter from the transferee substantially in the form of this letter to the Issuer and the Trustee,
which shall provide, among other things, that the transferee is an institutional “accredited investor” within the meaning of Rule
501(a)(1), (2), (3) or (7) under the Securities Act and that it is acquiring such Notes for investment purposes and not for
distribution in violation of the Securities Act. Each purchaser acknowledges that the Issuer and the Trustee reserve the right prior
to the offer, sale or other transfer prior to the Resale Restriction Termination Date of the Notes pursuant to clause 1(b), 1(c) or
1(d) above to require the delivery of an opinion of counsel, certifications or other information satisfactory to the Issuer and the
Trustee.
Dated:
TRANSFEREE:
,
By:
Exhibit B-2
[FORM OF SUPPLEMENTAL INDENTURE TO BE ENTERED INTO ON THE MERGER DATE]
EXHIBIT C
-1
SUPPLEMENTAL INDENTURE
[__________] SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of [ ], among DOMTAR
CORPORATION, a Delaware corporation (the “Issuer”), each of the parties identified as a Guarantor on the signature pages
hereto (each, a “Guarantor” and collectively, the “Guarantors”), and THE BANK OF NEW YORK MELLON, as trustee (in such
capacity, the “Trustee”) and as collateral agent (in such capacity, the “Collateral Agent”) under the indenture referred to below.
W I T N E S S E T H :
WHEREAS the Issuer, the guarantors party thereto and the Trustee have heretofore executed an indenture, dated as of
October 18, 2021 (as amended, supplemented or otherwise modified, the “Indenture”), providing for the issuance of the Issuer’s
6.750% Senior Secured Notes due 2028 (the “Notes”), initially in the aggregate principal amount of $775,000,000;
WHEREAS, the Issuer and each Guarantor that is a signatory hereto is executing this Supplemental Indenture pursuant
to which (i) the Issuer shall each become a party to the Indenture and assume all of the rights and be subject to all of the
obligations and agreements of the “Issuer” under the Indenture and (ii) each such Guarantor shall become a party to the Indenture
and assume all of the rights and be subject to all of the obligations and agreements of a “Guarantor” under the Indenture;
WHEREAS Sections 4.11 and 12.07 of the Indenture provide that under certain circumstances the Guarantors shall
execute and deliver to the Trustee and the Collateral Agent a supplemental indenture pursuant to which the Guarantors shall
unconditionally guarantee all the Issuer’s Obligations under the Notes and the Indenture pursuant to a Guarantee on the terms and
conditions set forth herein; and
WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee, the Collateral Agent, the Issuer and the Guarantors
are authorized to execute and deliver this Supplemental Indenture without the consent of holders.
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of
which is hereby acknowledged, the Guarantors, the Issuer, the Trustee and the Collateral Agent mutually covenant and agree for
the equal and ratable benefit of the holders of the Notes as follows:
Defined Terms
1.
. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used
herein as therein defined, except that the term “holders” in this Supplemental Indenture shall refer to the term “holders” as
defined in the Indenture and the Trustee acting on behalf of and for the benefit of such holders. The words “herein,” “hereof” and
“hereby” and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole
and not to any particular Section hereof.
Exhibit C-1
Agreement to Guarantee
2.
. The Guarantors hereby agree, jointly and severally, to unconditionally guarantee the Issuer’s Obligations under the
Notes and the Indenture on the terms and subject to the conditions set forth in Article XII of the Indenture and to be bound by all
other applicable provisions of the Indenture and the Notes and to perform all of the obligations and agreements of a Guarantor
under the Indenture.
3.
. All notices or other communications to the Guarantors shall be given as provided in Section 14.02 of the Indenture.
Notices
Ratification of Indenture; Supplemental Indentures Part of Indenture
4.
. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms,
conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the
Indenture for all purposes, and every holder of Notes heretofore or hereafter authenticated and delivered shall be bound hereby.
5.
. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
Governing Law
WITH, THE LAWS OF THE STATE OF NEW YORK.
Trustee and Collateral Agent Make No Representation
6.
. Neither the Trustee nor the Collateral Agent makes any representation as to the validity or sufficiency of this
Supplemental Indenture, or for or in respect of the recitals contained herein, all of which recitals are made solely by the Issuer
and Guarantor. The Issuer and Guarantor hereby authorizes and directs the Trustee to execute and deliver this Supplemental
Indenture.
Counterparts
7.
. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original,
but all of them together represent the same agreement. Delivery of an executed counterpart of a signature page to this Indenture
by telecopier, facsimile or other electronic transmission (i.e. a “pdf” or “tif”) shall be effective as delivery of a manually executed
counterpart thereof. One signed copy is enough to prove this Supplemental Indenture. The words “execution,” “signed,”
“signature,” “delivery,” and words of like import in or relating to this Supplemental Indenture or any document to be signed in
connection with this Supplemental Indenture shall be deemed to include electronic signatures, deliveries or the keeping of records
in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature,
physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, and the parties hereto consent to
conduct the transactions contemplated hereunder by electronic means.
8.
. The Section headings herein are for convenience only and shall not affect the construction thereof.
Effect of Headings
[Remainder of page intentionally left blank.]
Exhibit C-2
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
DOMTAR CORPORATION
By:
Name:
Title:
[GUARANTORS], as a Guarantor
By:
Name: [ ]
Title: [ ]
THE BANK OF NEW YORK MELLON, as Trustee and Collateral
Agent
By:
Name: [ ]
Title: [ ]
Exhibit C-3
EXHIBIT C
-2
[FORM OF SUPPLEMENTAL INDENTURE]
SUPPLEMENTAL INDENTURE
[__________] SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of [ ], among DOMTAR
CORPORATION, a Delaware corporation (the “Issuer”), [GUARANTOR] (the “New Guarantor”), and THE BANK OF NEW
YORK MELLON, as trustee (in such capacity, the “Trustee”) and as collateral agent (in such capacity, the “Collateral Agent”)
under the indenture referred to below.
W I T N E S S E T H :
WHEREAS the Issuer, the guarantors party thereto and the Trustee have heretofore executed an indenture, dated as of
October 18, 2021 (as amended, supplemented or otherwise modified, the “Indenture”), providing for the issuance of the Issuer’s
6.750% Senior Secured Notes due 2028 (the “Notes”), initially in the aggregate principal amount of $775,000,000;
WHEREAS Sections 4.11 and 12.07 of the Indenture provide that under certain circumstances the Issuer is required to
cause the New Guarantor to execute and deliver to the Trustee and the Collateral Agent a supplemental indenture pursuant to
which the New Guarantor shall unconditionally guarantee all the Issuer’s Obligations under the Notes and the Indenture pursuant
to a Guarantee on the terms and conditions set forth herein; and
WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee, the Collateral Agent and the Issuer are authorized to
execute and deliver this Supplemental Indenture without the consent of holders.
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of
which is hereby acknowledged, the New Guarantor, the Issuer, the Trustee and the Collateral Agent mutually covenant and agree
for the equal and ratable benefit of the holders of the Notes as follows:
Defined Terms
1.
. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used
herein as therein defined, except that the term “holders” in this Supplemental Indenture shall refer to the term “holders” as
defined in the Indenture and the Trustee acting on behalf of and for the benefit of such holders. The words “herein,” “hereof” and
“hereby” and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole
and not to any particular Section hereof.
Agreement to Guarantee
2.
. The New Guarantor hereby agrees, jointly and severally with all existing Guarantors (if any), to unconditionally
guarantee the Issuer’s Obligations under the Notes and the Indenture on the terms and subject to the conditions set forth in
Article XII of the Indenture and to be bound by all other applicable provisions of the Indenture and the Notes and to perform all
of the obligations and agreements of a Guarantor under the Indenture.
3.
. All notices or other communications to the New Guarantor shall be given as provided in Section 14.02 of the
Notices
Indenture.
Exhibit C-1
Ratification of Indenture; Supplemental Indentures Part of Indenture
4.
. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms,
conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the
Indenture for all purposes, and every holder of Notes heretofore or hereafter authenticated and delivered shall be bound hereby.
5.
. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
Governing Law
WITH, THE LAWS OF THE STATE OF NEW YORK.
Trustee and Collateral Agent Make No Representation
6.
. Neither the Trustee nor the Collateral Agent makes any representation as to the validity or sufficiency of this
Supplemental Indenture, or for or in respect of the recitals contained herein, all of which recitals are made solely by the Issuer
and New Guarantor. The Issuer and New Guarantor hereby authorizes and directs the Trustee to execute and deliver this
Supplemental Indenture.
Counterparts
7.
. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original,
but all of them together represent the same agreement. Delivery of an executed counterpart of a signature page to this Indenture
by telecopier, facsimile or other electronic transmission (i.e. a “pdf” or “tif”) shall be effective as delivery of a manually executed
counterpart thereof. One signed copy is enough to prove this Supplemental Indenture. The words “execution,” “signed,”
“signature,” “delivery,” and words of like import in or relating to this Supplemental Indenture or any document to be signed in
connection with this Supplemental Indenture shall be deemed to include electronic signatures, deliveries or the keeping of records
in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature,
physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, and the parties hereto consent to
conduct the transactions contemplated hereunder by electronic means.
8.
. The Section headings herein are for convenience only and shall not affect the construction thereof.
Effect of Headings
[Remainder of page intentionally left blank.]
Exhibit C-2
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
DOMTAR CORPORATION
By:
Name:
Title:
[NEW GUARANTOR], as a Guarantor
By:
Name: [ ]
Title: [ ]
THE BANK OF NEW YORK MELLON, as Trustee and Collateral
Agent
By:
Name: [ ]
Title: [ ]
Exhibit C-3
FORM OF JUNIOR LIEN INTERCREDITOR AGREEMENT
EXHIBIT D
[See attached.]
Exhibit D-1
SUPPLEMENTAL INDENTURE
Exhibit 4.4
Execution Version
FIRST SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of November 30, 2021, among
DOMTAR CORPORATION, a Delaware corporation (the “Issuer”), each of the parties identified as a Guarantor on the signature
pages hereto (each, a “Guarantor” and collectively, the “Guarantors”), and THE BANK OF NEW YORK MELLON, as trustee
(in such capacity, the “Trustee”) and as collateral agent (in such capacity, the “Collateral Agent”) under the indenture referred to
below.
W I T N E S S E T H :
WHEREAS Pearl Merger Sub Inc., a Delaware corporation (the “Initial Issuer”), and the Trustee have heretofore
executed an indenture, dated as of October 18, 2021 (as amended, supplemented or otherwise modified, the “Indenture”),
providing for the issuance of the Initial Issuer’s 6.750% Senior Secured Notes due 2028 (the “Notes”), initially in the aggregate
principal amount of $775,000,000;
WHEREAS, the Issuer and each Guarantor that is a signatory hereto is executing this Supplemental Indenture pursuant
to which (i) the Issuer shall become a party to the Indenture and assume all of the rights and be subject to all of the obligations
and agreements of the Initial Issuer as the “Issuer” under the Indenture and (ii) each such Guarantor shall become a party to the
Indenture and assume all of the rights and be subject to all of the obligations and agreements of a “Guarantor” under the
Indenture;
WHEREAS Sections 4.11 and 12.07 of the Indenture provide that under certain circumstances the Guarantors shall
execute and deliver to the Trustee and the Collateral Agent a supplemental indenture pursuant to which the Guarantors shall
unconditionally guarantee all the Issuer’s Obligations under the Notes and the Indenture pursuant to a Guarantee on the terms and
conditions set forth herein; and
WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee, the Collateral Agent, the Issuer and the Guarantors
are authorized to execute and deliver this Supplemental Indenture without the consent of holders.
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of
which is hereby acknowledged, the Issuer, the Guarantors, the Trustee and the Collateral Agent mutually covenant and agree for
the equal and ratable benefit of the holders of the Notes as follows:
(i)
. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used
Defined Terms
herein as therein defined, except that the term “holders” in this Supplemental Indenture shall refer to the term “holders” as
defined in the Indenture and the Trustee acting on behalf of and for the benefit of such holders. The words “herein,” “hereof” and
“hereby” and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole
and not to any particular Section hereof.
(ii)
. The Issuer hereby agrees to assume all of the rights and Obligations of the “Issuer” under the Indenture on the terms
Agreement of the Issuer
and subject to the conditions set forth
in the Indenture and to be bound by all other applicable provisions of the Indenture and to perform all of the Obligations and
agreements of the “Issuer” under the Indenture.
(iii)
. The Guarantors hereby agree, jointly and severally, to unconditionally guarantee the Issuer’s Obligations under the
Agreement to Guarantee
Notes and the Indenture on the terms and subject to the conditions set forth in Article XII of the Indenture and to be bound by all
other applicable provisions of the Indenture and the Notes and to perform all of the obligations and agreements of a Guarantor
under the Indenture.
(iv)
. All notices or other communications to the Guarantors shall be given as provided in Section 14.02 of the Indenture.
Notices
(v)
. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms,
Ratification of Indenture; Supplemental Indentures Part of Indenture
conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the
Indenture for all purposes, and every holder of Notes heretofore or hereafter authenticated and delivered shall be bound hereby.
(vi)
. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
Governing Law
WITH, THE LAWS OF THE STATE OF NEW YORK.
(vii)
. Neither the Trustee nor the Collateral Agent makes any representation as to the validity or sufficiency of this
Trustee and Collateral Agent Make No Representation
Supplemental Indenture.
(viii)
. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original,
Counterparts
but all of them together represent the same agreement. Delivery of an executed counterpart of a signature page to this Indenture
by telecopier, facsimile or other electronic transmission (i.e. a “pdf” or “tif”) shall be effective as delivery of a manually executed
counterpart thereof. One signed copy is enough to prove this Supplemental Indenture. The words “execution,” “signed,”
“signature,” “delivery,” and words of like import in or relating to this Supplemental Indenture or any document to be signed in
connection with this Supplemental Indenture shall be deemed to include electronic signatures, deliveries or the keeping of records
in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature,
physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, and the parties hereto consent to
conduct the transactions contemplated hereunder by electronic means.
(ix)
. The Section headings herein are for convenience only and shall not affect the construction thereof.
Effect of Headings
[Remainder of page intentionally left blank.]
2
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
DOMTAR CORPORATION, as Issuer
By:
Name:
Title:
Pearl Excellence Holdco LP, as a Guarantor
By:
Name: [ ]
Title: [ ]
EAM CORPORATION, as a Guarantor
By:
Name: [ ]
Title: [ ]
DOMTAR PAPER COMPANY, LLC, as a Guarantor
By:
Name: [ ]
Title: [ ]
DOMTAR A.W. LLC, as a Guarantor
By:
Name: [ ]
Title: [ ]
3
THE BANK OF NEW YORK MELLON, as Trustee and Collateral
Agent
By:
Name: [ ]
Title: [ ]
4
SUPPLEMENTAL INDENTURE
Exhibit 4.5
EXECUTION VERSION
SECOND SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of December 30, 2021, among
DOMTAR CORPORATION, a Delaware corporation (the “Issuer”), DOMTAR DELAWARE HOLDINGS INC., a Delaware
corporation (the “New Guarantor”), and THE BANK OF NEW YORK MELLON, as trustee (in such capacity, the “Trustee”) and
as collateral agent (in such capacity, the “Collateral Agent”) under the indenture referred to below.
W I T N E S S E T H :
WHEREAS the Issuer, the guarantors party thereto and the Trustee have heretofore executed an indenture, dated as of
October 18, 2021 (as amended, supplemented or otherwise modified, the “Indenture”), providing for the issuance of the Issuer’s
6.750% Senior Secured Notes due 2028 (the “Notes”), initially in the aggregate principal amount of $775,000,000;
WHEREAS Sections 4.11 and 12.07 of the Indenture provide that under certain circumstances the Issuer is required to
cause the New Guarantor to execute and deliver to the Trustee and the Collateral Agent a supplemental indenture pursuant to
which the New Guarantor shall unconditionally guarantee all the Issuer’s Obligations under the Notes and the Indenture pursuant
to a Guarantee on the terms and conditions set forth herein; and
WHEREAS pursuant to Section 9.01 of the Indenture, the Trustee, the Collateral Agent and the Issuer are authorized to
execute and deliver this Supplemental Indenture without the consent of holders.
NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of
which is hereby acknowledged, the New Guarantor, the Issuer, the Trustee and the Collateral Agent mutually covenant and agree
for the equal and ratable benefit of the holders of the Notes as follows:
(i)
. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recital hereto are used
Defined Terms
herein as therein defined, except that the term “holders” in this Supplemental Indenture shall refer to the term “holders” as
defined in the Indenture and the Trustee acting on behalf of and for the benefit of such holders. The words “herein,” “hereof” and
“hereby” and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole
and not to any particular Section hereof.
(ii)
. The New Guarantor hereby agrees, jointly and severally with all existing Guarantors (if any), to unconditionally
Agreement to Guarantee
guarantee the Issuer’s Obligations under the Notes and the Indenture on the terms and subject to the conditions set forth in
Article XII of the Indenture and to be bound by all other applicable provisions of the Indenture and the Notes and to perform all
of the obligations and agreements of a Guarantor under the Indenture.
(iii)
. All notices or other communications to the New Guarantor shall be given as provided in Section 14.02 of the
Notices
Indenture.
(iv)
. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms,
Ratification of Indenture; Supplemental Indentures Part of Indenture
conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the
Indenture for all purposes, and every holder of Notes heretofore or hereafter authenticated and delivered shall be bound hereby.
(v)
. THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
Governing Law
WITH, THE LAWS OF THE STATE OF NEW YORK.
(vi)
. Neither the Trustee nor the Collateral Agent makes any representation as to the validity or sufficiency of this
Trustee and Collateral Agent Make No Representation
Supplemental Indenture, or for or in respect of the recitals contained herein, all of which recitals are made solely by the Issuer
and New Guarantor. The Issuer and New Guarantor hereby authorizes and directs the Trustee to execute and deliver this
Supplemental Indenture.
(vii)
. The parties may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original,
Counterparts
but all of them together represent the same agreement. Delivery of an executed counterpart of a signature page to this Indenture
by telecopier, facsimile or other electronic transmission (i.e. a “pdf” or “tif”) shall be effective as delivery of a manually executed
counterpart thereof. One signed copy is enough to prove this Supplemental Indenture. The words “execution,” “signed,”
“signature,” “delivery,” and words of like import in or relating to this Supplemental Indenture or any document to be signed in
connection with this Supplemental Indenture shall be deemed to include electronic signatures, deliveries or the keeping of records
in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature,
physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, and the parties hereto consent to
conduct the transactions contemplated hereunder by electronic means.
(viii)
. The Section headings herein are for convenience only and shall not affect the construction thereof.
Effect of Headings
[Remainder of page intentionally left blank.]
IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed as of the date first written above.
DOMTAR CORPORATION
By:
Name:
Title:
DOMTAR DELAWARE HOLDINGS INC, as a Guarantor
By:
Name:
Title:
THE BANK OF NEW YORK MELLON, as Trustee and Collateral
Agent
By:
Name:
Title:
THIRTEENTH SUPPLEMENTAL INDENTURE
FOR ADDITIONAL NOTE GUARANTEE
Exhibit 4.6
EXECUTION VERSION
This Thirteenth Supplemental Indenture, dated as of December 30, 2021 (this “Supplemental Indenture”), among
Domtar Delaware Holdings Inc., a Delaware corporation (the “New Subsidiary Guarantor”), Domtar Corporation, a Delaware
corporation (together with its successors and assigns, the “Company”) and The Bank of New York Mellon, as successor to The
Bank of New York, as Trustee (the “Trustee”), under the Indenture referred to below.
W I T N E S S E T H :
WHEREAS, the Company, the subsidiary guarantors party thereto (the “Subsidiary Guarantors”) and the Trustee have
heretofore executed and delivered a Senior Indenture, dated as of November 19, 2007 (as supplemented by the Supplemental
Indenture, dated as of February 15, 2008, the Second Supplemental Indenture, dated as of February 20, 2008, the Third
Supplemental Indenture, dated as of June 9, 2009, the Fourth Supplemental Indenture, dated as of June 23, 2011, the Fifth
Supplemental Indenture, dated as of September 7, 2011, the Sixth Supplemental Indenture, dated as of March 16, 2012, the
Seventh Supplemental Indenture, dated as of May 21, 2012, the Eighth Supplemental Indenture, dated as of August 23, 2012, the
Ninth Supplemental Indenture, dated as of July 31, 2013, the Tenth Supplemental Indenture, dated as of November 26, 2013, the
Eleventh Supplemental Indenture, dated as of November 4, 2015 and the Twelfth Supplemental Indenture, dated as of January 23,
2017, as amended, waived or otherwise modified, the “Indenture”), providing for the issuance from time to time of series of the
Company’s Securities (as defined in the Indenture);
WHEREAS, pursuant to Section 1011 of the Indenture, the Company is required to cause each U.S. Subsidiary (as
defined in the Indenture) that guarantees indebtedness of the Company or any of the Company’s subsidiaries to execute and
deliver to the Trustee a supplemental indenture pursuant to which such U.S. Subsidiary will unconditionally guarantee, jointly
and severally with each other Subsidiary Guarantor, the Company’s full and prompt payment of the principal of, premium, if any,
and interest on the Securities on a senior basis and all other obligations under the Indenture; and
WHEREAS, pursuant to Section 901 of the Indenture, the Company and the Trustee are authorized to execute and
deliver this Supplemental Indenture to supplement the Indenture, without the consent of any Holder;
NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of
which is hereby acknowledged, the New Subsidiary Guarantor, the Company and the Trustee mutually covenant and agree for the
equal and ratable benefit of the holders of the Securities as follows:
Section 1.1. Defined Terms. Unless otherwise defined in this Supplemental Indenture, terms defined in the Indenture
are used herein as therein defined.
ARTICLE I
DEFINITIONS
ARTICLE II
AGREEMENT TO BE BOUND; GUARANTEE
Section 2.1. Agreement to be Bound. Subject to the provisions of Article Fourteen of the Indenture, the New
Subsidiary Guarantor hereby becomes a party to the Indenture as a Subsidiary Guarantor and as such will have all of the rights
and be subject to all of the obligations and agreements of a Subsidiary Guarantor under the Indenture. The New Subsidiary
Guarantor hereby agrees to be bound by all of the provisions of the Indenture applicable to a Subsidiary Guarantor and to
perform all of the obligations and agreements of a Subsidiary Guarantor under the Indenture.
Section 2.2. Guarantee. The New Subsidiary Guarantor hereby fully, unconditionally and irrevocably guarantees as
primary obligor and not merely as surety, jointly and severally with each other Subsidiary Guarantor, to each Holder of the
Securities and the Trustee, the full and punctual payment when due, whether at maturity, by acceleration, by redemption or
otherwise, of the principal of, premium, if any, and interest on the Securities and all other obligations and liabilities of the
Company under the Indenture, all as more fully set forth in Article Fourteen thereof.
ARTICLE III
MISCELLANEOUS
Section 3.1. Notices. Any notice or communication delivered to the Company under the provisions of the Indenture
shall constitute notice to the New Subsidiary Guarantor.
Section 3.2. Parties. Nothing expressed or mentioned herein is intended or shall be construed to give any Person, firm
or corporation, other than the Holders and the Trustee, any legal or equitable right, remedy or claim under or in respect of this
Supplemental Indenture or the Indenture or any provision herein or therein contained.
Section 3.3. Governing Law, etc. This Supplemental Indenture shall be governed by the provisions set forth in Section
112 of the Indenture.
Section 3.4. Severability. In case any provision in this Supplemental Indenture shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired
thereby and such provision shall be ineffective only to the extent of such invalidity, illegality or unenforceability.
Section 3.5. Ratification of Indenture; Supplemental Indenture Part of Indenture. Except as expressly amended hereby,
the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full
force and effect. This Supplemental Indenture shall form a part of the Indenture for all purposes, and every holder of Securities
heretofore or hereafter authenticated and delivered shall be bound hereby. The Trustee makes no representation or warranty as to
the validity or sufficiency of this Supplemental Indenture.
Section 3.6. Duplicate and Counterpart Originals. The parties may sign any number of copies of this Supplemental
Indenture. One signed copy is enough to prove this Supplemental
Indenture. This Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be an
original, but all of them together represent the same agreement.
Section 3.7. Headings. The headings of the Articles and Sections in this Supplemental Indenture have been inserted
for convenience of reference only, are not intended to be considered as a part hereof and shall not modify or restrict any of the
terms or provisions hereof.
[Remainder of page intentionally left blank.]
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first
above written.
DOMTAR CORPORATION
By:
Name:
Title:
DOMTAR DELAWARE HOLDINGS, INC., as New Subsidiary
Guarantor
By:
Name:
Title:
THE BANK OF NEW YORK MELLON, as Trustee
By:
Name:
Title:
Exhibit 10.6
Execution Version
STRICTLY CONFIDENTIAL
, 2021
Mr. John D. Williams 8954
Winged Bourne
Charlotte, NC 28210
Re: Second Amended and Restated Employment Agreement Dear John,
We are pleased to confirm the terms of your continued employment with Domtar Corporation, a Delaware corporation (the
“Company” or “Domtar”). Your employment with the Company commenced as of January 1, 2009 (your “Start Date”) in
accordance with the terms of our letter to you dated September 15, 2008 (the “Prior Letter Agreement”), which Prior Letter
Agreement was amended and restated pursuant to that certain Amended and Restated Employment Agreement, dated as of
June 25, 2013 (the “Amended and Restated Employment Agreement”). As of the date of the consummation (the “Closing”)
of the transactions (the “Transaction”) contemplated by that certain Agreement and Plan of Merger, among the Company,
Karta Halten B.V., Pearl Merger Sub Inc., Paper Excellence B.V., and Hervey Investments B.V., dated as of May 10, 2021
(the “Effective Date”), your employment with the Company will continue on the terms set forth herein. This Second
Amended and Restated Employment Agreement (this “Agreement”) amends and restates in its entirety the Amended and
Restated Employment Agreement as of the Effective Date. If the Closing does not occur, this Agreement shall not become
effective and employment shall continue under the terms of the Amended and Restated Employment Agreement.
1.
Duties. During the Term (as defined below), you will serve as President and Chief Executive
Officer of the Company. Your duties and responsibilities will be consistent with that of the senior-most executive officer of
Domtar and be subject to oversight and reporting, as specified by the board of directors or advisors of the Company that will be
appointed by the direct and indirect shareholders of Paper Excellence B.V. (the “Board”), or any other office of the Company
designated by the Board. During the Term, you will report directly to the Board or its designee and will devote all of your skill,
knowledge and full working time solely and exclusively to the conscientious performance of your duties hereunder, other than
authorized vacation time and absence for sickness or disability. You agree to devote your full business time to the business and
affairs of the Company Group (as hereinafter defined) except for (i) time spent serving on corporate, civic or charitable boards
or committees set forth on Exhibit A to this Agreement, (ii) time spent serving on any other corporate, civic or charitable boards
or
US-DOCS\125707364.11
Exhibit 10.6
committees provided that such service (individually or in the aggregate) does not materially interfere with the
performance of your duties and responsibilities, that service on any corporate board is subject to the prior approval of the
Board and that no such activities involve being involved with a competitive organization, and (iii) periods of vacation and
sick leave to which you are entitled.
2.
Location. During the Term, you shall perform your duties at the Company’s Operations Center
in Fort Mill, South Carolina, USA (although from time to time you may be required to travel to other locations to properly
fulfill your responsibilities).
3.
Term. The term of employment under this Agreement shall be for the period beginning on the
Effective Date and ending on June 30, 2023 (the “Term” and such date, the “Term End Date”), subject to termination in
accordance with the provisions of Section 12.
4.
Base Salary. During the Term, your base salary will be equal to $1,213,800 and will be paid in
U.S. dollars (the “Base Salary”), which Base Salary may be increased from time to time by the Board in its sole discretion and
shall be reviewed annually by the Board (or in each case by the Human Resources Committee of the Board). Your Base Salary
shall be payable at the same time as the Company pays salary to members of the management committee of the Company (the
“Management Committee”).
5.
Annual Incentive Bonus. During the Term, you will be eligible to participate in the Domtar
Corporation Annual Incentive Plan (as amended from time to time and including any successor to such plan, the “Annual
Incentive Plan”). Your target annual bonus under the Annual Incentive Plan will be equal to 117% of your Base Salary and your
maximum annual bonus under the Annual Incentive Plan will be equal to 200% of your Base Salary. The target annual bonus
and maximum annual bonus levels and applicable performance objectives will be established annually by the Board (or the
Human Resources Committee of the Board) in consultation with you. Any annual bonus with respect to a particular year will be
payable within two and a half months following the end of such year.
6.
Long-Term Incentive Bonus. You will be eligible to earn a cash bonus equal to a maximum of
$3,175,000 (the “Long-Term Incentive Bonus”), with $1,500,000 subject to a service-based requirement (the “Service-Based
LTI”) and $1,675,000 subject to a performance- based requirement (the “Performance-Based LTI”). Your eligibility to earn the
Long-Term Incentive Bonus will be in lieu of, and not in addition to, any other payment or benefit you would otherwise be
entitled to earn pursuant to any current or future long-term incentive plan sponsored by the Company.
(a)
Service-Based LTI. The Service-Based LTI will vest in three installments as
follows, subject to your continued employment with the Company through each applicable vesting date: (i) twenty-five
percent (25%) of the Service-Based LTI will vest on March 30, 2022; (ii) twenty-five percent (25%) of the Service-Based
LTI will vest on March 30, 2023; and
(iii) fifty percent (50%) of the Service-Based LTI will vest on the Term End Date. For the avoidance of doubt, the maximum
Service-Based LTI that may be paid to you is equal to
$1,500,000. Except as otherwise provided in Section 12(b), upon your termination of employment for any reason prior
to the Term End Date, any unvested portion of the Service-
US-DOCS\125707364.11
Based LTI will automatically be forfeited on the date of such termination. Any vested portion of the Service-Based LTI
will be paid to you in a lump sum in cash within thirty (30) days following the applicable vesting date.
Exhibit 10.6
(b)
Performance-Based LTI.
(i)
All or a portion of the Performance-Based LTI may become
earned based on (A) the Company’s achievement during the Term of any of the six key performance indicators
(“Current CEO KPIs”) and (B) your successor as the Chief Executive Officer of the Company (appointed in accordance
with the table below, the "Successor CEO") achieving any of the three key performance indicators (“Successor CEO
KPIs” and, together with the Current CEO KPIs, the “KPIs”), in each case as outlined on the chart below as established
by the Board after consultation with you. The total amount that may be earned with respect to each achieved KPI (an
“Earned Amount”) is set forth opposite such KPI on the table below in the column titled “Earned Amount.” The
maximum Performance-Based LTI that may be paid to you is equal to
$1,675,000. Any determinations with respect to whether a KPI has been achieved will be determined by the
Company in its sole discretion, and with respect to the EBITDA and free cash flow KPI, based on the audited
financial statements for the applicable fiscal year, and such decision will be final and binding on you. Except as
otherwise provided in Section 12(b), upon your termination of employment for any reason prior to the Term End
Date, you will automatically forfeit your eligibility to earn any additional Earned Amounts with respect to the
KPIs; provided that any Earned Amounts already accrued as of the date of your termination will be paid to you in
accordance with the payment schedule set forth in Section 6(b)(ii).
KPI Type
Key Performance Indicator
Earned Amount
Current CEO KPI
2021 EBITDA vs Plan
Current CEO KPI
2022 EBITDA vs Plan
Current CEO KPI
2022 Free cash flow vs Plan
Current CEO KPI
2023 EBITDA vs Plan
Current CEO KPI
2023 Free cash flow vs Plan
Current CEO KPI
The Successor CEO’s appointment as the chief
executive officer of the Company prior to March 1,
2023; provided that to the extent requested by the
Board, you actively assisted with the search for and
appointment of the Successor CEO
$150,000
$300,000
$225,000
$300,000
$225,000
$300,000
Successor CEO KPI
Successor CEO remains actively employed with
the Company through July 30, 2024 (the “2024
Successor CEO KPI”)
$25,000
US-DOCS\125707364.11
Successor CEO KPI
Successor CEO remains actively employed with
the Company through July 30, 2025 (the “2025
Successor CEO KPI”)
Successor CEO KPI
Successor CEO remains actively employed with
the Company through July 30, 2026 (the “2026
Successor CEO KPI”)
$50,000
$100,000
Exhibit 10.6
(ii)
Any Earned Amounts with respect to the Performance-Based
LTI will be paid in a lump sum in cash on the dates and in the proportions set forth on the table below.
Payment Date
Earned Amounts Paid
October 30, 2024
October 30, 2025
October 30, 2026
One-third (1/3) of the total Earned Amounts in respect
of Current CEO KPIs, plus any Earned Amount in
respect of the 2024 Successor CEO KPI
One-third (1/3) of the total Earned Amounts in respect
of Current CEO KPIs, plus any Earned Amount in
respect of the 2025 Successor CEO KPI
One-third (1/3) of the total Earned Amounts in respect
of Current CEO KPIs, plus any Earned Amount in
respect of the 2026 Successor CEO KPI
7.
Change in Control Bonus. The Company shall pay you a bonus in an aggregate amount equal to
$5,270,000 (the “Change in Control Bonus”) in three equal installments on the following dates: (a) the date of the Closing, (b)
the one-year anniversary of the Closing, and (c) the Term End Date. Payment of the applicable amount will be made in a lump
sum in cash within thirty (30) days following the applicable dates set forth in clauses (a) through (c) of the preceding
sentence. Notwithstanding the foregoing, upon your termination of employment for any reason prior to the Term End Date,
any unpaid portion of the Change in Control Bonus will be paid as soon as administratively practicable (not more than thirty
(30) days) after the date of such termination. Any previously paid amount of the Change in Control Bonus shall be subject to
recoupment by the Company, to the extent permitted by applicable law, in the event of your material breach of Section 14.
8.
SERP. You shall continue to be eligible to accrue benefits in the DB SERP for Management
Committee Members of Domtar (the “DB SERP”) and the DC SERP for Designated Executives of the Company (the “DC
SERP”) in accordance with the terms of the DB SERP and DC SERP, respectively.
US-DOCS\125707364.11
Exhibit 10.6
9.
Company Plane and Automobile. During the Term, you may use the Company plane for business
travel, when necessary, subject to quarterly review by the Human Resources Committee of the Board; provided that you will be
required to reimburse the Company in an amount equivalent to a first class commercial fare for any passengers traveling with
you on the Company plane for reasons other than business. During the Term, you will be entitled to use the Company plane for
personal reasons for up to 36 hours per calendar year during the term of your employment, and hereby acknowledge and agree
that you will be solely responsible for any taxes incurred by you with respect to this benefit. Further, during the Term, you may
continue to use the automobile leased by the Company and provided to you by the Company as of the date hereof.
10.
Employee Benefits.
(a)
During the Term, you will be eligible to participate in the employee benefit
plans and programs generally available to the Company’s senior U.S.-based employees as in effect from time to time, on the
same basis as the Company’s other employees, subject to the terms and provisions of such plans and programs. Detailed
information about the benefit plans and about our Human Resources policies and programs has been provided to you. During
the Term, you will receive a minimum of four weeks paid vacation per year.
During the Term, you shall also receive additional financial planning and
medical benefits on the same basis as, and to the extent that, such benefits are provided to members of the Management
Committee.
(b)
one business, athletic or country club in the Charlotte, North Carolina area.
(c)
During the Term, you will be reimbursed by the Company for annual dues for
11.
Expenses. During the Term, the Company will reimburse you for all reasonable expenses
incurred by you in connection with your performance of services under this Agreement in accordance with the Company’s
policies, practices and procedures.
12.
Termination of Employment.
(a)
Termination for Cause, Resignation without Good Reason, Other Terminations.
Upon a termination of your employment during the Term (i) by the Company for Cause, (ii) by you without Good Reason,
(iii) by the Company as a result of a breach by you of your obligations under Sections 13 – 18, inclusive, or of any
representation or warranty made by you in this Agreement, or (iv) by the Company as a result of a material breach by you of
any other term or condition of this Agreement, you shall be entitled to the Accrued Amounts (and shall be entitled to no other
compensation, bonus, payments or benefits). If you resign from your employment without Good Reason, you must provide
the Company with six months prior written notice of your termination, or such lesser period as shall be agreed by the Human
Resources Committee of the Board (the “Resignation Notice Period”). During the Resignation Notice Period you shall
continue to receive your Base Salary and continue to receive the compensation and benefits associated with your employment
described generally in this Agreement. The Company may elect in its sole discretion to place you on paid leave and suspend
your duties and responsibilities for all or any part of such Resignation Notice Period. During the Resignation
US-DOCS\125707364.11
Exhibit 10.6
Notice Period, you shall not perform services for any other business or employer. During the Resignation Notice Period, the
Company may also elect to terminate your employment prior to the termination of the Resignation Notice Period and pay
you the outstanding Base Salary for the balance of the Resignation Notice Period in a lump sum, together with any
payments under the Annual Incentive Plan and the Service-Based LTI that would have otherwise been become vested or
been payable during the Resignation Notice Period, and further provided that any portion of the Performance-Based LTI that
would have become an Earned Amount during the remainder of the Resignation Notice Period shall be earned to the extent
the KPIs are achieved, which Earned Amounts (if any) shall be payable in a lump sum in cash within thirty (30) days
following the date of your termination of employment. Notwithstanding the foregoing, any payment or benefit provided
under this Section 12(a) following your Separation from Service that is subject to Section 409A of the Code (as hereinafter
defined) will be paid at the same time and in the same manner that the severance allowance or other comparable benefit
described in Section 12(b) is required to be paid. If you are terminated by the Company before termination of the
Resignation Notice Period and paid your Base Salary as set forth in the preceding two sentences (as applicable), you will
not be entitled to any additional payment or other benefits which you otherwise would have accrued or received during the
Resignation Notice Period or the remainder of the Resignation Notice Period. Actions taken by the Company pursuant to
this Section 12(a) shall not entitle you to any severance or other benefits under Section 12(b) or otherwise.
(b)
Termination without Cause, Resignation for Good Reason, Death/Disability,
Term End Date. The Company reserves the right to terminate your employment at any time for any reason whatsoever;
provided that the Company provides you with six months prior written notice of the termination in the event of a termination
without Cause and subject to the provisions of this Section 12. Upon a termination of your employment during the Term (i)
automatically as a result of your death or Disability, (ii) by the Company without Cause, or (iii) by you for Good Reason,
and, (A) in the case of the payments and benefits set forth in subsections (ii) through (v) of this Section 12(b), subject to your
execution, delivery and non-revocation within 21 days after your termination of a general release in a form provided by the
Company, and (B) in the case of the payments set forth in subsection (ii) of this Section 12(b), your continued compliance
with Section 14, you (or your estate) will receive the following payments and benefits:
(i)
the Accrued Amounts;
(ii)
(A) full accelerated vesting of the entire unvested portion of the
Service-Based LTI (if any), payable in a lump sum in cash within thirty (30) days following the date of such
termination of employment, (B) a portion of any then- unearned Performance-Based LTI with respect to the Current
CEO KPI(s) for the fiscal year in which the termination of employment occurs will be deemed an Earned Amount
which portion shall be calculated based on the actual achievement of the Current CEO KPI(s) through the end of the
calendar year in which such termination of employment occurs, multiplied by a fraction, the numerator of which is
the number of days in such calendar year prior to the date of such termination of your employment and the
denominator of which is the total number of days in such calendar year, and any such Earned Amounts will become
payable in accordance with the original payment schedule
US-DOCS\125707364.11
Exhibit 10.6
outlined in Section 6(b)(ii) hereof, and (C) the set dollar amounts related to the Successor CEO KPIs set forth in
Section 6(b)(ii) shall remain eligible to be earned subject to the Successor CEO KPIs being achieved;
(iii)
(A) the bonus you would have received pursuant to the Annual
Incentive Plan for the year in which such termination by the Company occurs if you had continued in employment
based on achievement of the applicable performance criteria for such year, multiplied by a fraction, the numerator of
which is the number of days in such calendar year prior to the date of such termination of your employment and the
denominator of which is the total number of days in such calendar year, and (B) if such termination by the Company
occurs after the end of a calendar year, any bonus you otherwise would have received pursuant to the Annual
Incentive Plan for such calendar year that has not been paid as of the date of termination, with any payment to which
you become entitled under clause (A) or (B) to be made on the date in the following calendar year that bonuses for the
relevant calendar year are paid to the members of the Management Committee but in no event later than March 15 of
such following calendar year; and
(iv)
subject to your election to participate in continued coverage
under the Company’s health insurance policies pursuant to COBRA, and payment of the applicable monthly
participation premiums, the Company will reimburse you for the excess of your monthly premium payment to
maintain COBRA coverage over your monthly premium costs as an active employee, subject, if applicable, to Section
22(c), until the date of 24 months following the date of your termination of employment, or, if earlier, until the date on
which coverage from another employer is obtained.
(c)
Termination following the Term End Date. Upon a termination of your
employment as a result of the Term End Date, subject to your execution, delivery and non- revocation within 21 days
after your termination of a general release in a form provided by the Company, you (or your estate) will receive the
following payments and benefits:
(i)
subject to your election to participate in continued coverage
under the Company’s health insurance policies pursuant to COBRA, and payment of the applicable monthly
participation premiums, the Company will reimburse you for the excess of your monthly premium payment to
maintain COBRA coverage over your monthly premium costs as an active employee, subject, if applicable, to Section
22(c), until the date of 24 months following the date of your termination of employment, or, if earlier, until the date on
which coverage from another employer is obtained.
For the avoidance of doubt, in the event of a termination of your employment as a result of the Term End Date, the
Performance-Based LTI shall continue to become earned (not prorated) based on achievement of the 2023 Current CEO
KPIs and the Successor CEO KPIs and paid to the extent earned per the provisions of Section 6(b) above.
(d)
No Other Payments; No Offset. Severance and other benefits provided under
this Section 12 includes any pay in lieu of notice and severance pay required by law and, except as expressly provided
herein, is in lieu of and not in addition to any severance or other
US-DOCS\125707364.11
benefits payable under any applicable Domtar severance policy, including the Domtar Severance Program or any future
similar arrangement established by Domtar or its affiliates in which you may otherwise be eligible to participate. Further,
any benefits payable to you pursuant to this Section 12 will be in full satisfaction of all liabilities to you under this
Agreement and with respect to any other claim you may have in conjunction with your termination of employment.
These benefits will not be subject to any offset, mitigation or other reduction as a result of your receiving salary or other
benefits by reason of your securing other employment following your termination of employment with the Company. If you
die before the payments, benefits and other consideration have been paid or provided to you under Section 12, such payments,
benefits and other consideration shall be paid or provided to your estate or your designated beneficiary, as applicable.
Exhibit 10.6
(e)
Definitions. For purposes of this Agreement:
(i)
“Accrued Amounts” means (A) any unpaid Base Salary and any
other earned but unpaid compensation with respect to the period prior to the effective date of the termination, (B)
reimbursement of expenses to which you are entitled, and (C) any other benefits to which you are legally entitled
(including, for the avoidance of doubt, any unpaid portion of the Change in Control Bonus, and in the case of your
termination of your employment due to retirement or early retirement in accordance with the terms of the DB SERP,
such post-retirement payments and benefits as are provided under the plans, policies and programs of the Company in
which you participate as of the date of your retirement);
(ii)
“Cause” means (A) your willful failure to perform
substantially your duties as an officer and employee of the Company (other than due to physical or mental illness),
(B) your engaging in serious misconduct that is injurious to the Company, (C) your having been convicted of a
crime that constitutes an indictable offense under the Canadian Criminal Code or a felony under U.S. law, (D) your
willful unauthorized disclosure of Confidential Information or violation of the Confidential Information and
Intellectual Property Agreement or (E) your material breach of any provision of this Agreement.
(iii)
“Disability” means any circumstance resulting in your incapacity
to perform your duties and responsibilities under this Agreement for (A) a continuous period of 120 days, or (B) periods
amounting in the aggregate to 180 days within any one period of 365 days. A determination of Disability shall be made
and confirmed in writing by a physician or physicians satisfactory to the Company, and you shall cooperate with any
efforts to make such determination. Any such determination shall be conclusive and binding on the parties. Any
determination of Disability under this Section 12(e)(iii) is not intended to alter any benefits that any party may be
entitled to receive under any long term disability insurance plan carried by either the Company or you with respect to
you, which benefits shall be governed solely by the terms of any such insurance plan.
(iv)
“Good Reason” means the occurrence of any of the following
without your consent (A) a material reduction by the Company in your Base Salary or target annual bonus then in
effect; provided that you shall not have a basis to resign for
US-DOCS\125707364.11
Exhibit 10.6
Good Reason if (x) such reduction is part of an across-the-board reduction in base salary rate or target annual
incentive opportunity similarly affecting other Management Committee members or (y) no bonus is paid, or the
amount of the bonus is reduced as a result of the failure of the executive or the Company to achieve the applicable
performance goals; (B) a material diminution in your position, duties or responsibilities, excluding for this purpose
(x) a change in title or reporting relationship alone or change in contemplation of the transition of your
responsibilities to the Successor CEO, and (y) an isolated, insubstantial and inadvertent action not taken in bad
faith and which is remedied by the Company promptly after receipt of notice thereof given by the executive;
(C) a requirement that you move your principal place of business to a location that is more than 50 miles from
your then work location; and (iv) a material breach by the Company of any agreement under which you provide
services: in each case, provided that you provide written notice to the Company of the condition giving rise to
Good Reason within 90 days of the initial existence of the condition, such condition is not remedied within 30
days of receipt of such notice, and you terminate employment within 30 days following the end of such 30-day
cure period.
13.
Unauthorized Disclosure. During your employment with the Company and at all times thereafter,
except as required pursuant to your good faith exercise of your duties under Section 1 of this Agreement, you will not, except
with the express consent of the Board or its authorized representative, disclose any confidential or proprietary trade secrets,
customer lists, drawings, designs, information regarding product development, marketing plans, sales plans, manufacturing
plans, management organization information, operating policies or manuals, business plans, financial records, packaging design
or other financial, commercial, business or technical information (i) relating to the Company or any of its subsidiaries or
affiliates or (ii) that the Company or any of its subsidiaries or affiliates (collectively, the “Company Group”) may receive
belonging to suppliers, customers or others who do business with the Company or any of their respective affiliates (collectively,
“Confidential Information”) to any third person unless such Confidential Information has been previously disclosed to the
public or is in the public domain (other than by reason of your breach of this letter agreement).
You acknowledge and agree that you have signed and are bound by the Company’s form of Confidential Information
and Intellectual Property Agreement.
14.
Non-Competition. While you are employed, and during the period commencing on the date of
your termination of employment and ending (a) 24 months thereafter and (b) in addition, during such longer period during
which you are eligible to receive payment under Section 12(b)(ii), up to a maximum of 36 months after the date of your
termination of employment, you agree that you shall not, directly or indirectly, engage in business with, serve as an agent or
consultant to, become a general partner, member, principal or important stockholder or equity holder (other than a holder of less
than 2% of the outstanding voting shares of any publicly held entity) of or become employed in a senior-level management
position by, any person, firm or other entity that competes with the Business (as hereinafter defined) of the Company Group in
North America or any other location or market in which the Company Group conducts the Business or markets its products,
except where (i) the business of such person, firm or other entity that competes with the business of the Company Group is
negligible or incidental to the primary business of such firm such that less than 10% of the consolidated revenues of such
US-DOCS\125707364.11
Exhibit 10.6
person, firm or other entity comes from the competing business, (ii) your interest or association with such person, firm or
other entity does not and will not in any way relate to the business of the Company Group, and (iii) prior to your
commencing any such employment, you certify in writing to the Company that the position satisfies the requirements of
clauses (i) and (ii) above and that you have informed such entity of the restrictions on your activities contained in this
letter agreement. Whether any such person, firm or entity competes with the Business of the Company Group shall be
determined in good faith by the Board. For purposes of this letter agreement, “Business” shall mean the business of
designing, manufacturing, marketing and distributing a wide variety of fiber-based products, including communication
papers, specialty and packaging papers.
15.
Non-Solicitation of Employees. While you are employed, and during the period commencing on
the date of your termination of employment and ending 24 months thereafter, you agree that you shall not, directly or indirectly,
for your own account or for the account of any other person or entity with which you are or shall become associated in any
capacity, (i) solicit for employment, employ or otherwise interfere with the relationship of the Company Group with any person
who at any time during the twelve months preceding such solicitation, employment or interference is or was employed by or
otherwise engaged to perform services for the Company Group, other than any such solicitation or employment during your
employment with the Company on behalf of the Company Group, or (ii) induce any employee of the Company Group who is a
member of management to engage in any activity which you are prohibited from engaging in under any of Sections 13 – 18,
inclusive or to terminate his or her employment with the Company Group. For purposes of this Section 15, the placement of
“help wanted” advertisements, postings on internet job sites and searches by employment search companies which are not
specifically targeting employees of the Company Group shall not result in a violation of this Section 15.
16.
Non-Solicitation of Customers. While you are employed, and during the period commencing on
the date of your termination of employment and ending 24 months thereafter , you shall not, directly or indirectly, (i) induce or
attempt to induce any customer, distributor, supplier or other business relation of the Company Group to cease doing business
with, or reduce the amount of business conducted with, the Company Group or (ii) solicit or otherwise attempt to establish for
yourself or any other person, firm or entity anywhere in North America, or in any other location or market in which the
Company Group conducts the Business or markets its products, any business relationship of a nature that is competitive with the
Business or relationship of any member of the Company Group with any person, firm or corporation which was a customer,
client or distributor of any member of the Company Group during the period during which you are employed or during the
twelve-month period preceding the date of your termination of employment (and whom you came into contact with or had
knowledge of as a result of your employment with the Company), other than any such solicitation for the benefit of the
Company Group during your employment with the Company Group.
17.
Return of Documents. In the event of the termination of your employment for any reason, you
shall deliver to the Company Group all of its property and non-personal documents and data of any nature and in whatever
medium pertaining to your employment with the Company Group, and you shall not take with you any such property,
documents or data of any
US-DOCS\125707364.11
Exhibit 10.6
description or any reproduction thereof, or any documents containing or pertaining to any Confidential
Information.
18.
Certain Understandings, Injunctive Relief with Respect to Covenants.
(a)
You acknowledge and agree that your covenants, obligations and agreements
under this letter with respect to noncompetition, nonsolicitation, confidentiality and Company Group property relate to
special, unique and extraordinary matters and that a violation of any of the terms of such covenants, obligations or
agreements will cause the Company Group irreparable injury for which adequate remedies are not available at law.
Therefore, you agree that the Company Group shall be entitled to an injunction, restraining order or such other equitable
relief (without the requirement to post bond) as a court of competent jurisdiction may deem necessary or appropriate to
restrain you from committing any violation of the covenants, obligations or agreements referred to in this Section 18;
provided, however, that in the case of a breach of Section 14 during the period set forth in Section 14(b) (i.e., more than 24
months after your termination of employment during which you are eligible to receive payment under Section 12(b)(ii), up to
a maximum of 36 months after the date of your termination of employment), the only available remedy shall be forfeiture of
any unpaid portion of the payments set forth in Section 12(b)(ii). These injunctive remedies are cumulative and in addition to
any other rights and remedies the Company Group may have. You and the Company Group hereby irrevocably submit to the
exclusive jurisdiction of the United States Federal and Delaware State courts, in each case located in the State of Delaware, in
respect of the injunctive remedies set forth in this Section 18 and the interpretation and enforcement of Sections 13 – 18,
inclusive, insofar as such interpretation and enforcement relate to any request or application for injunctive relief in
accordance with the provisions of this Section 18, and the parties hereto hereby irrevocably agree that (i) the sole and
exclusive appropriate venue for any suit or proceeding relating solely to such injunctive relief shall be in such a court, (ii)
claims with respect to any request or application for such injunctive relief shall be heard and determined exclusively in such a
court, (iii) any such court shall have exclusive jurisdiction over the person of such parties and over the subject matter of any
dispute relating to any request or application for such injunctive relief and (iv) each hereby waives any and all objections and
defenses based on forum, venue or personal or subject matter jurisdiction as they may relate to an application for such
injunctive relief in a suit or proceeding brought before such a court in accordance with the provisions of this Section 18.
(b)
You and the Company Group agree that you will have a prominent role in the
management of the business, and the development of the goodwill, of the Company Group and will establish and develop
relations and contacts with the principal customers and suppliers of the Company Group in Canada, the United States and
the rest of the world, all of which constitute valuable goodwill of, and could be used by you to compete unfairly with, the
Company Group.
(c)
You acknowledge that (i) in the course of your employment with the
Company Group, you will obtain confidential information and trade secrets concerning the worldwide business and
operations of the Company Group; (ii) the covenants and restrictions contained in Sections 13 – 18, inclusive, are
intended to protect the legitimate interests of the Company Group to protect its goodwill, trade secrets and other
confidential information; and
US-DOCS\125707364.11
Exhibit 10.6
(i)
you agree to be bound by such covenants and restrictions and to enter into this letter agreement.
19.
Indemnification. The Company acknowledges and agrees that it has entered into an
Indemnification Agreement with you in the same form as entered into with the directors of the Company.
20.
Immigration Matters. To the extent applicable, you will continue to use all reasonable efforts
to cooperate with the Company in (i) satisfying all applicable Canadian and
U.S. legal requirements allowing you to legally work in Fort Mill, South Carolina and travel to the Company’s offices in
Montreal, Quebec, Canada, (ii) obtaining or renewing a United States work permit and (iii) obtaining or renewing visas
and other documentation or approvals necessary for business travel between the United States and Canada.
21.
Representations and Warranties; Waiver. You represent and warrant that (1) the representations
and warranties you made in the Amended and Restated Employment Agreement were true and correct when made; (2) you are
not subject to any agreements or restrictive covenants with any former employer or any other person or entity that (i) prevent
your employment with the Company, or (ii) limit your ability to perform for the Company the duties of President and Chief
Executive Officer (except to the extent you may be subject to pre-existing confidentiality obligations or prohibited from
solicitation of employees for a limited period of time); and (3) no representations were made to you concerning the terms or
conditions of your employment except as expressly set out in this letter. You hereby agree that any changes to your employment
relationship with the Company in accordance with this Agreement occurring in connection with the Transaction shall not
constitute “Good Reason” or any similar concept under this Agreement or any current or future Domtar severance policy,
including the Domtar Severance Program. You hereby expressly waive your legal right to claim that “Good Reason” (or a
similar concept) has occurred under the terms of this Agreement and any such Domtar severance policy due to any such
changes occurring in connection with the Transaction.
22.
Section 409A.
(a)
For purposes of this Agreement, “Separation from Service” shall mean a
separation from service within the meaning of section 409A of the United States Internal Revenue Code of 1986, as
amended (the “Code”), and the United States treasury regulations promulgated thereunder (“Section 409A”).
(b)
Notwithstanding anything else contained in this Agreement to the contrary, if
you are a “specified employee” within the meaning of Section 409A (a “Specified Employee”), any payment required to be
made to you hereunder or otherwise upon or following the date of termination of your employment that is subject to Section
409A shall be delayed until after the six month anniversary of your Separation from Service to the extent necessary to
comply with, and avoid imposition on you of any tax penalty imposed under, Section 409A. Should payments be delayed in
accordance with the preceding sentence, the accumulated payment that would have been made but for the period of the delay
shall be paid in a single lump sum during the 10 day period following the six month anniversary of your Separation from
Service.
US-DOCS\125707364.11
(c)
Notwithstanding anything else contained in this letter agreement to the
contrary, in the event that any continued health coverage to which you become entitled under Section 12(b)(iv) or
Section 12(c)(i) is subject to Section 409A, such benefits shall be administered as follows:
Exhibit 10.6
(i)
If you would otherwise be eligible to elect continued health
coverage under Section 4980B of the Code (COBRA) (x) if permitted by the applicable plan and applicable law, your
coverage under the applicable health insurance policies maintained by the Company will remain in effect until the last
day on which you would otherwise be eligible for COBRA coverage if you had elected such coverage and paid the
applicable premiums (the “COBRA Period”) and the Company shall reimburse you for the excess of the cost of
obtaining comparable health insurance coverage for the portion of the 24 month period provided in Section 12(b)(iv) or
Section 12(c)(i), as applicable, (if any) that extends beyond the COBRA Period over your cost of continued coverage
for the COBRA Period; or (y) if not so permitted, the Company shall reimburse you for the excess of the cost of
COBRA coverage over what would have been your cost of continued coverage for the COBRA Period under the
applicable health insurance policies had you been permitted to continue coverage for the COBRA Period, and the
excess of the cost of obtaining comparable health insurance coverage for the portion of the 24 month period provided in
Section 12(b)(iv) or Section 12(c)(i), as applicable, (if any) that extends beyond the COBRA Period over what would
have been your cost of continued coverage for the COBRA Period under the applicable health insurance policies had
you been permitted to continue coverage for the COBRA Period; provided that, if you are a Specified Employee you
will pay the full cost of any health coverage for which you would otherwise be reimbursed under clause (x) or (y), as
applicable, during the six- month period following the date of your Separation from Service, with the full amount of
such costs to be reimbursed to you on the first payroll date following the six-month anniversary of the date or your
Separation from Service. If you obtain equivalent or better coverage elsewhere, this coverage will terminate.
(ii)
If you would not otherwise be eligible to elect COBRA
coverage, your coverage under the applicable health insurance policies maintained by the Company will remain in
effect until the last day of the 24 month period provided in Section 12(b)(iv) or Section 12(c)(i), as applicable;
provided that, if you are a Specified Employee you will pay the full cost of any such health coverage provided to you
for the six-month period following the date of your Separation from Service, with the full amount of such costs to be
reimbursed to you on the first payroll date following the six- month anniversary of the date or your Separation from
Service. If you obtain equivalent or better coverage elsewhere, this coverage will terminate.
(d)
Except as expressly provided in Section 21(c), any reimbursement payment or
benefit under this agreement that is subject to Section 409A shall be administered and paid as follows: (i) the Company shall
reimburse any expense or cost due to you pursuant to this Agreement, provided that you have submitted to the Company
appropriate documentation evidencing the particular expense or cost as promptly as possible and in any event within 90 days
after the end of the calendar year in which the expense is incurred by you; (ii) the Company shall pay for any benefits in kind
provided pursuant to this Agreement and, provided that appropriate
US-DOCS\125707364.11
Exhibit 10.6
documentation evidencing the particular expense or cost is timely submitted in accordance with the requirements of clause
(i), shall make any reimbursement due to you under this Agreement as promptly as possible, and in no event later than the
last day of your taxable year following the taxable year in which the related expense was incurred; (iii) the amount of any
reimbursement or in-kind benefit provided under this agreement in one taxable year shall not affect the amount of any
reimbursement or in-kind benefit provided to you in any other taxable year; and (iv) no entitlement to any reimbursement or
in-kind benefit provided under this Agreement shall be subject to liquidation or exchange for another benefit.
(e)
It is intended that any payment, reimbursement or in-kind benefit under this
Agreement be administered in a manner consistent with the requirements, where applicable, of Section 409A in a manner to
avoid the imposition of immediate tax recognition and additional taxes pursuant to Section 409A. Neither the Company nor
any of its directors, officers or employees shall have any liability to you in the event such Section 409A applies to any
payment, reimbursement or in-kind benefit provided pursuant to this Agreement in a manner that results in adverse tax
consequences for you or any of your beneficiaries or transferees.
23.
General Provisions.
(a)
No provisions of this Agreement may be amended, modified, waived or
discharged unless such amendment, modification, waiver or discharge is approved by the Human Resources Committee of
the Board and is agreed to in a writing signed by you and such Company officer as may be specifically designated by the
Human Resources Committee to the Board. No waiver by either party hereto at any time of any breach by the other party
hereto of, or compliance with, any condition or provision of this letter agreement to be performed by such other party will be
deemed a waiver of similar or dissimilar provisions or conditions at the same or at any prior or subsequent time.
(b)
No agreements or representations, oral or otherwise, express or implied, with
respect to the subject matter hereof, have been made by either party, other than as set forth expressly in this Agreement. This
Agreement codifies all of your entitlements before, during and following a termination of your employment with the
Company and supersedes and replaces any and all prior agreements or understandings, whether written or oral, including but
not limited to the Amended and Restated Employment Agreement, which may have existed with respect to the subject matter
hereof or otherwise in relation to your employment or termination of employment with the Company. The invalidity or
unenforceability of any one or more provisions of this Agreement will not affect the validity or enforceability of any other
provision of this letter agreement, which will remain in full force and effect. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original but all of which together will constitute one and the same
instrument.
(c)
You agree that you will abide by and adhere to all laws and rules and
regulations of the various regulatory and/or self-regulatory organizations of which the Company or any of its affiliates or
related entities are members, as well as all internal rules, regulations, policies and codes of conduct that the Company has
established.
US-DOCS\125707364.11
Exhibit 10.6
All amounts payable to you hereunder will be paid net of any and all applicable
income or employment taxes required to be withheld therefrom under applicable U.S., Canadian or foreign, State, provincial or
local laws or regulations.
(d)
(e)
The validity, interpretation, construction and performance of this letter agreement
will be governed by the laws of the State of Delaware and, where applicable, the federal laws of the United States of America
without regard to any conflicts or choice oflaw rule or principle that might otherwise refer construction or interpretation of this
letter to the substantive law of another jurisdiction. In the event that any provision or portion of this letter shall be determined to be
invalid or unenforceable for any reason, in whole or in part, the remaining provisions of this Agreement shall be unaffected thereby
and shall remain in full force and effect to the fullest extent permitted by law. You may not assign this Agreement; however, the
Company may assign this Agreement to any of its affiliates or successors.
Les parties ont expressement requis que cette entente soit redigee en anglais.
(f)
The parties have expressly requested that this Agreement be drafted in English.
If the foregoing accurately sets forth the terms of your employment with the Company, please so indicate by signing below and
returning one signed copy of this Agreement to one or both of us.
Sincerely,
DOMTAR CORPORATION
By:- - - - - - - - - - - - - - -
Tom Shih
as of this /'IO ti
/'$'!!' , 2021
By:_ _ _ _ _ _ _ _ _ _ _ _ _ _ _
Hardi Wardhana
ACCEPTED AND AGREED
John D. Williams
US-DOCS\125707364.11
Exhibit A Permitted Board
Service
Exhibit 10.6
Owens Corning – Public Form
Technologies – Private Camp Blue
Skies – Non Profit
Palisades Episcopal School – Non Profit Charlotte Symphony
Orchestra – Non Profit
US-DOCS\125707364.11
EMPLOYMENT AGREEMENT (the “Agreement”)
Exhibit 10.7
BETWEEN:
DOMTAR INC., a company duly incorporated, having an establishment at 395 De Maisonneuve Boulevard W, in
Montreal, Province of Quebec H3A 1L6
(hereinafter, the “Company”)
AND:
DANIEL BURON, a person domiciled at 861 Boissy Street, in Saint-Lambert, Province of Quebec, J4R 1K1
(hereinafter, the “Executive”) (hereinafter
collectively referred to as the "Parties")
WHEREAS the Executive has been employed by the Company since 1999;
WHEREAS the Executive held the position of Executive Vice President and Chief Financial Officer of the Company;
WHEREAS the Company, Karta Halten B.V., Pearl Merger Sub Inc, Paper Excellence B.V. and Hervey Investment
B.V. have entered into a certain Agreement and Plan of Merger, under which the Company would be acquired by Karta Halten B.V. (the
“Transaction”);
WHEREAS the consummation of the Transaction (known as the “Closing”) occurred November 30, 2021;
WHEREAS the Executive has stated that he can end his employment and claim Good Reason for doing so following a Change in Control
as such terms are defined in the Severance Program for Management Committee Members;
WHEREAS the Parties have agreed, now that the Closing has occurred, to terminate the Executive’s indefinite term employment contract
on January 16, 2022 (the “Effective Date”), without any admission on either side and to settle any and all matters related to the period of
employment and its termination, as appears from Appendix A;
WHEREAS the employment relationship between the Executive and the Company will therefore be effectively terminated on the Effective
Date, and all sums that may have been due to the Executive by virtue of that employment relationship and in consideration of the
applicable contracts, programs, plans, policies and laws will be paid as stated in Appendix A;
WHEREAS the Executive acknowledges that his employment will be effectively terminated on the Effective Date and that he will not be
entitled to, under any circumstances, invoke that previous period of employment/continued service under the indefinite term employment
contract to support any right, indemnity, damages under any law, regulation or contract whatsoever;
WHEREAS the Parties have agreed, now that the Closing has occurred, to enter into a fixed term employment contract, namely from the
day after the Effective Date to March 1, 2024;
WHEREAS the terms and conditions of said fixed term contract are described below;
SECTION 1 – PURPOSE
1.1
The Company hereby engages the services of the Executive as Executive Vice President and Chief Financial Officer of the
Company;
Exhibit 10.7
SECTION 2 – DUTIES
2.1
2.2
2.3
2.4
2.5
2.6
2.7
2.8
The Executive shall report directly to the President and Chief Executive Officer of the Company;
The Executive’s duties and responsibilities will be consistent with that of the senior-most financial executive of the Company;
The Executive agrees to work exclusively for the Company, to make every effort necessary to perform adequately the duties that
are assigned to him and to act in the best interests of the Company at all times. Notwithstanding the previous sentence, Executive
may continue to serve on no more than 3 boards of directors provided that such service does not impede the expected level of
dedicated service to the Company and does not violate Sections 2.4 and 2.5 below;
The Executive shall refrain from engaging in any activity that could be prejudicial to the Company’s interests. In performing his
duties with the Company, the Executive shall act faithfully and honestly at all times;
In all circumstances, the Executive shall avoid any situation that could be, directly or indirectly, interpreted as creating a conflict of
interest;
The Executive agrees to comply with all rules and policies established from time to time, verbally or in writing, by the Company;
The Executive acknowledges that he has been informed of such rules and policies currently in force at the Company and more
specifically, that he has read, understood and agrees to comply with the terms of the Company’s code of conduct;
The Executive acknowledges that the Company may, from time to time, alter its rules and policies or issue new ones. The
Executive agrees to follow and to be bound by all amended or new rules and policies;
SECTION 3 – LOCATION OF WORK
3.1
Location
Subject to business travel required from time to time in the performance of his duties, including international travel, the
Executive will perform his duties and functions primarily from the facility located in Montréal, Québec;
SECTION 4 – DURATION AND TERMINATION
4.1
Duration
This Agreement is for a fixed term. It shall take effect on the day after the Effective Date and shall end definitively on March 1,
2024 (the “Term End Date”) without the Company being required to give any reasonable notice whatsoever to the Executive,
and without the Company being required to pay any indemnity in lieu of reasonable notice whatsoever or any severance of any
kind whatsoever. Accordingly and without limiting the generality of the foregoing, no indemnity in lieu of reasonable notice
under the Civil Code of Québec or severance pay under the Act respecting labour standards nor any severance provided for
under any contract, program, plan or policy shall be payable to the Executive upon the expiration of this Agreement;
2
Exhibit 10.7
4.2
Renewal
The Parties shall have the option of renewing this Agreement for a maximum period of twenty four (24) months within one
month prior to the expiry of the present Agreement. Such renewal must be in writing signed by the Parties. At the expiration of
this additional twenty four 24 months (which would then become the Term End Date for the purpose of this Agreement), no other
renewal shall be possible and this Agreement shall end definitively without the Company being required to give any reasonable
notice whatsoever to the Executive, and without the Company being required to pay any indemnity in lieu of reasonable notice
whatsoever or any severance of any kind whatsoever. Accordingly and without limiting the generality of the foregoing, no
indemnity in lieu of reasonable notice under the Civil Code of Québec or severance pay under the Act respecting labour
standards nor any severance provided for under any contract, program, plan or policy shall be payable to the Executive upon
the expiration of this Agreement;
4.3
Payment on the Term End Date
Upon a termination of Executive’s employment on the Term End Date, which shall be deemed a retirement under the Company’s
plans, policies and programs, the Executive (or his estate) will receive the following payments and benefits:
4.3.1
4.3.2
4.3.3
4.3.4
4.3.5
Base salary: any unpaid base salary and any other earned but unpaid compensation with respect to the period
prior to the effective date of termination;
STIP: (A) the bonus the Executive would have received pursuant to the Annual Incentive Plan for the year in which
the Term End Date occurs if the Executive had continued in employment based on achievement of the applicable
performance criteria for such year, multiplied by a fraction, the numerator of which is the number of days in such
calendar year prior to the Term End Date and the denominator of which is the total number of days in such
calendar year, and (B) if the Term End Date occurs after the end of a calendar year, any bonus the Executive
otherwise would have received pursuant to the Annual Incentive Plan for such calendar year that has not been
paid as of the date of termination, with any payment to which the Executive becomes entitled to under clause (A)
or (B) to be made on the date in the following calendar year that bonuses for the relevant calendar year are paid to
the members of the Management Committee but in no event later than March 15 of such following calendar year;
LTIP: if the Executive has any unvested Restricted Stock Units (RSUs) upon the Term End Date, they will be
prorated based on the number of days elapsed from the respective grant date through the Term End Date. For US
taxpayers, prorated RSUs are settled as of January
31 following the year of Termination. For non-US taxpayers, RSUs are settled upon termination (subject to an
administrative delay). Any remaining RSUs shall be forfeited and cancelled as of the Term End Date;
If the Executive has any unvested Performance Share Units (PSUs), they will be prorated based on the number of
days elapsed from the commencement of the respective performance period through the Term End Date. The
prorated PSUs are subject to the achievement of the performance goals and will be payable once the Human
Resources Committee of the Board of Directors determines that the goals have been satisfied for each respective
grant. Any remaining PSUs will be forfeited and cancelled upon the Term End Date;
Executive’s coverage under the Company’s medical and dental insurance policies will remain in effect for 24 months
after the Term End Date at no cost to Executive. In the event that Executive obtains equivalent or better coverage
elsewhere during the 24 month period, this coverage will terminate. Upon the conclusion of this 24 months of
coverage, Executive will be eligible to seek coverage under the Company’s post retirement benefits plan.
3
Exhibit 10.7
4.4
Automatic Termination
The Executive’s employment shall terminate automatically upon the death of the Executive without the Company being bound
to pay any compensation whatsoever except as otherwise required herein or under the text of the Company’s plans, policies and
programs in the case of the death of an employee;
The Executive’s employment may also be terminated by the Company, in writing transmitted to the Executive, without the
Company being bound to pay any compensation whatsoever in the following cases (unless otherwise required under the text of
the Company’s plans, policies and programs in the event of such terminations):
4.4.1
4.4.2
4.4.3
4.4.4
if the Executive breaches the terms of this Agreement;
if the Executive commits any fraud, theft, embezzlement or other criminal act, or is guilty of serious misconduct or
wilful negligence in the performance of his duties;
if the Executive willfully causes harm to the public image of the Company or its affiliates;
for any other just and sufficient cause and/or serious reason within the meaning of Article 2094 of the Civil Code of
Québec;
Upon such termination, the Executive shall be entitled to any unpaid base salary and any other earned but unpaid
compensation with respect to the period prior to the effective date of termination.
SECTION 5 – COMPENSATION
5.1
Base Salary
The Company shall pay the Executive on the basis of an annual salary of US$661,670.00 payable in accordance with the
standard payroll practices of the Company with regard to members of the Management Committee and subject to all legally
required withholdings and deductions. This salary is subject to review in accordance with the Company’s policies and at the sole
discretion of the Company on January 1st of each year starting January 1, 2022;
5.2
Annual Incentive Plan
Throughout the duration of this Agreement, the Executive shall be eligible to participate in the Company’s Annual Incentive
Plan, as amended from time to time by the Company;
5.2.1
5.2.2
5.2.3
The Executive’s target annual bonus under the Annual Incentive Plan will be equal to 89% of his base salary, his
maximum annual bonus being equal to 200% of his base salary;
The applicable performance objectives shall be established annually by the Company in consultation with the
Management Committee;
Any annual bonus with respect to a particular year shall be payable within two and half months following the end of
such year;
5.3
Long-Term Incentive Plan
Throughout the duration of this Agreement, the Executive shall be eligible to participate in the Company’s Long-Term Incentive
Plan at 165% of base salary in accordance with the Company’s criteria, which will include both a service-based component
and a performance-based component. At the expiration of this
4
Agreement, the Executive will be eligible to receive a prorated payment under this plan, according to the provisions applicable
to retirement;
5.4
Retention Bonus
Exhibit 10.7
By way of this Agreement, Executive is eligible to receive a retention bonus equal to 50% of base salary, subject to all legally
required withholdings and deductions, for each of the next two years. Specifically, Executive is eligible for a lump sum cash
payment on the first anniversary of the Closing provided that he is employed by the Company as of such date in an amount
equal to 50% of annual base salary in effect as of the first anniversary of the Closing (such sum, the “First Year Retention
Bonus”). Executive is eligible for a lump sum cash payment on the second anniversary of the Closing provided that he is
employed by the Company as of such date in an amount equal to 50% of his annual base salary in effect as of the second
anniversary of the Closing (such sum, the “Second Year Retention Bonus”). Each retention bonus will fully vest upon
completion of the applicable anniversary year (i.e., no longer subject to forfeiture) and will be paid to Executive in a lump sum
within 45 days of each completed anniversary. Executive will not be eligible for the retention bonuses as set forth above if he is
terminated for cause or he resigns prior to such applicable anniversary.
If the Company terminates Executive’s employment without cause before the second anniversary of the Closing, then
Executive will be eligible to receive each of the retention bonuses set forth above minus any such retention bonus that has
already been paid. The payment of such retention bonus(es) would be made at the regular dates of payment as if Executive was
still actively employed (i.e., there would be no acceleration of payment).
If Executive retires, becomes disabled or dies (i) during the first twelve month period following the Closing, Executive will be
eligible for a pro rata portion of the First Year Retention Bonus, calculated based on the number of days that have elapsed from
the Closing through such termination, divided by 365 days, or (ii) during the second twelve month period following the Closing,
Executive will be eligible for a pro rata portion of the Second Year Retention Bonus, calculated based on the number of days that
have elapsed from the first anniversary of the Closing through such termination, divided by 365 days. Any prorated payment
pursuant to the preceding sentence shall be made within 45 days of such termination.
5.5
Expenses
The Company shall reimburse the Executive for any reasonable business-related expenses in accordance with the Company’s
policies, practices and procedures;
SECTION 6 – BENEFITS
6.1
General Benefits
Throughout the duration of this Agreement, the Executive shall be entitled to continue to participate in all employee benefit
plans, practices and programs available to the Company’s senior Canadian-based employees maintained by the Company and
consistent with applicable law and the applicable terms of such plans and programs, to the understanding that the relevant
information on these plans and programs has been provided to the Executive;
The Executive shall also receive additional financial planning and medical benefits such as they are provided to the members
of the Management Committee;
6.2
Supplemental Retirement Savings Plan (SERP)
Throughout the duration of this Agreement, the Executive shall be eligible to accrue benefits in the Supplementary Pension
Plan for Designated Managers of Domtar, the DB SERP for Management
5
Committee Members of Domtar and the DC SERP for Designated Executives of the Company in accordance with the terms of
the programs as established by the Company;
6.3
Vacation
Throughout the duration of this Agreement, the Executive shall be entitled to 32 days paid vacation per year. Without admission
regarding Executive’s entitlement to previous unused vacation, the Parties agree that the Executive shall be entitled to use and
must take an additional 56 days of previous unused paid vacation prior to the Term End Date;
SECTION 7 – CONFIDENTIALITY
Exhibit 10.7
7.1
The Executive acknowledges that he has received and will receive or conceive, in carrying on or in the course of his work during
his employment with the Company, confidential information pertaining to the activities, technologies, operations and business,
past,
or
Company
associated companies, which information is not in the public domain. The Executive acknowledges that such confidential
information belongs to the Company and that its disclosure or unauthorized use could be prejudicial to the Company and
contrary to its interests;
subsidiaries
present
related
future,
and
the
its
or
or
of
Accordingly, the Executive agrees to respect the confidentiality of such information and not to make use of it, disclose it to, or
discuss it with any person, other than in the course of his duties with the Company, without the explicit prior written
authorization of the Company;
This undertaking to respect the confidentiality of such information and not to make use of it, disclose it to, or discuss it with any
person shall continue to have full effect after the termination of his employment with the Company;
7.2
The term “confidential information” includes among other things:
7.2.1
7.2.2
7.2.3
7.2.4
7.2.5
products, formulae, processes and composition of products, as well as raw materials and ingredients, of whatever
kind, that are used in their manufacture, including all tools, tooling, dies, jigs, patterns, moulds, samples,
prototypes, models, test equipment or other equipment or fixtures;
technical knowledge and methods, quality control processes, inspection methods, laboratory and testing methods,
information processing programs and systems, manufacturing processes, plans, drawings, tests, test reports and
software;
equipment, machinery, devices, tools, instruments and accessories;
financial information, production cost data, marketing strategies, raw materials supplies, suppliers, staff and client
lists and related information, marketing plans, sales techniques and policies, including pricing policies, sales and
distribution data and present and future expansion plans; and
research, experiments, inventions, discoveries, developments, improvements, ideas, industrial secrets and “know-
how”;
The Executive also undertakes to keep the terms of this Agreement confidential, provided that the Executive may disclose the
terms of Agreement to his financial and legal advisors who are bound by confidentiality obligations at least as restrictive as those
contained herein;
7.3
6
Exhibit 10.7
SECTION 8 – OWNERSHIP OF INTELLECTUAL PROPERTY
8.1
8.2
8.3
The Executive hereby assigns and agrees to assign to the Company all (i) patents, applications for patents and reissues, renewals,
extensions and continuations-in-part of patents or patent applications;
(ii) proprietary and non-public business information, including all discoveries, inventions (whether patentable or not),
improvements, innovations, processes, topographies, codes, software, know-how, recipes, technology, formulas, drawings,
designs, specifications for products, communication plans, materials and equipment, process development and ideas,
disclosures, trade secrets, confidential information and customer lists, and documentation on whatever support it is relating to
any of the foregoing; (iii) copyrights, copyright registrations and applications for copyright registration; (iv) trade names,
business names, corporate names, domain names, world wide web addresses, common law trade-marks, trade-mark
registrations, trade-mark applications, trade dress and logos, and the goodwill associated with any of the foregoing; (v) software,
including computer software and programs (both source code and object code form); and (vi) any other intellectual property and
industrial property (collectively, “Work Product”), which relate to the Company and which are authored, conceived, developed,
reduced to practice, contributed to or made by the Executive during the period of his employment, and agrees to make full and
prompt disclosure to the Company of all information relating to anything made or designed by him or that may be made or
designed by him during such period;
In the event that the Company is not automatically regarded as the owner of the Work Product, the Executive agrees to assign
and hereby assigns to the Company any right, title and interest that the Executive may possess in and to the Work Product, and
the Executive agrees to waive and hereby waives any and all other rights that are non-assignable, including common law rights
(but not limited to moral rights), in all Work Product or any non-economic right, free and clear of any claims for compensation or
restrictions on the use or ownership thereof. The Executive acknowledges that the Company has the right to use, modify or
reproduce any document or work realized by the Executive, at its entire discretion, without the Executive’s authorization and
without his name being mentioned;
At any time during the period of his employment or after the termination of his employment, the Executive shall sign,
acknowledge and deliver, at the Company’s expense, but without compensation other than a reasonable sum for his time
devoted thereto if his employment has then terminated, any document required by the Company to give effect to section 8.1,
including patent applications and documents evidencing the assignment of ownership, or to establish, record, perfect and
otherwise confirm, protect or maintain such rights. The Executive shall also provide such other assistance as the Company may
require with respect to any proceedings or litigation relating to the protection or defence of intellectual property rights belonging to
the Company;
8.4
This section shall be binding on the Executive’s heirs, assigns and legal representatives;
SECTION 9 – OWNERSHIP OF FILES AND OTHER PROPERTY
9.1 Any file, sketch, drawing, letter, report, memo or other document, any equipment, machinery, tool, instrument or other device, any
compact disc or software or any other property which comes into the Executive’s possession during his employment with the
Company, in the performance or in the course of his duties, regardless of whether he has participated in its preparation or
design, how it may have come into his possession and whether or not it is an original or a copy, shall at all times remain the
property of the Company and, upon the termination of the Executive’s employment, shall be returned to the Company or its
designated representative before the Executive leaves his place of work. The Executive may not keep a copy or give one to a
third party;
SECTION 10 – GENERAL PROVISIONS
10.1
As of the effective date hereof, this Agreement supersedes and cancels any prior agreement, verbal or written, with respect to
the Executive’s employment with the Company;
7
Exhibit 10.7
10.2
10.3
No agreements or representations, oral or otherwise, express or implied, with respect to the subject matter hereof, have been
made by either party, other than as set forth expressly in this Agreement;
No provisions of this Agreement may be amended, modified, waived or discharged unless such amendment, modification, waiver
or discharge is approved by the Human Resources Committee of the Board and is agreed to in a written document signed by the
Executive and such Company officer as may be specifically designated by the Human Resources Committee to the Board. No
waiver by either party hereto at any time of any breach by the other party hereto of, or compliance with, any condition or provision
of this agreement to be performed by such other party will be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time;
10.4
The Executive agrees that he shall abide by and adhere to all laws and rules and regulations of the various regulatory and/or self-
regulatory organizations of which the Company or any of its affiliates or related entities are members, as well as all internal rules,
regulations, policies and codes of conduct that the Company has established;
10.5
This Agreement may be executed in one or more counterparts, each of which will be deemed to be an original, but all of which
together will constitute one and the same instrument;
SECTION 11 – NOTICES
11.1 Any notice given hereunder shall be given in writing and sent by registered or certified mail or hand delivered. If such notice is sent
by registered or certified mail, it shall be deemed to have been received five (5) business days following the date of its mailing if
the postal services are working normally. If such is not the case, the notice must be hand-delivered or served by bailiff, at the
discretion of the sender. In the case of hand delivery or service, the notice shall be deemed to have been received the same
day. It is agreed that if the delivery date is a non-business day, the notice shall be deemed to have been received on the
following business day;
SECTION 12 – INTERPRETATION
12.1 This Agreement shall be governed by and interpreted in accordance with the laws of the Province of Québec;
SECTION 13 – SEVERABILITY
13.1 If any provision of this Agreement, or the application thereof to any person, place or circumstance, shall be held by a court of
competent jurisdiction to be invalid, unenforceable, or void, the remainder of this Agreement and such provisions as applied to
other persons, places and circumstances shall remain in full force and effect;
SECTION 14 – LANGUAGE
14.1 The parties have expressly requested that this Agreement be drafted in the English language. Les parties ont expressément requis
que cette convention d’emploi soit rédigée en anglais.
8
[Signature page follows]
employment in duplicate on the dates and at the places hereinafter set forth.
IN WITNESS WHEREOF the parties hereto have duly signed this contract of
Exhibit 10.7
In Montreal, January 18 , 2022
In Montreal, January 14, 2022
DOMTAR INC.
By:
Name: John D. Williams
Title:President and CEO
DANIEL BURON
9
Exhibit 21
DOMTAR CORPORATION – SUBSIDIARY COMPANIES
As of December 31, 2021
Domtar Corporation
Domtar Industries LLC
Domtar Funding Limited Liability Company
E.B. Eddy Paper, Inc.
Ariva Distribution Inc.
Domtar A.W. LLC
Domtar Wisconsin Dam Corp.
Domtar Europe Sprl
Domtar AI Inc.
EAM Corporation
Palmetto Enterprises LLC
Domtar Paper Company, LLC
Domtar Delaware Holdings, LLC
West Carrollton Paper LLC
Domtar Delaware Holdings Inc.
Domtar Luxembourg Investments Sarl
Domtar Inc.
13536637 Canada Inc.
Domtar Pulp and Paper General Partnership (held 0.001% by 13536637 Canada Inc. and 99.999% by DInc)
Domtar Asia Limited
Brompton Lands Limited
Domtar Hong Kong Limited (held 34% by DInc. and 66% by DPC, LLC)
DKP Pulp ULC
AFFILIATED COMPANIES - (% held)
Celluforce Inc.
Clergue Forest Management Inc.
Dryden Forest Management Company Ltd
Forest Insurance Limited
Red Lake Forest Management Inc.
Red Lake Independent Loggers Co. Ltd.
Northshore Forest Inc.
Ondaadiziwin Forest Management Inc.
Prisma Renewable Composites, LLC
Vermilion Forest Management Co.
-
-
-
(44%)
(42%)
(8.33% voting shares)
(17%)
(50% of class A shares)
(33.3%)
(42%)
(25%)
(55%)
(24.17 class A shares)
CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 31.1
I, John D. Williams, certify that:
1.
2.
3.
4.
I have reviewed this annual report on Form 10-K of Domtar Corporation;
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 the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this
report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in
Exchange 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)
b)
c)
d)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being prepared;
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles;
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal
control over financial reporting.
Date: March 10, 2022
/s/ John D. Williams
John D. Williams
President and Chief Executive Officer
CERTIFICATION BY THE CHIEF FINANCIAL OFFICER PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 31.2
I, Daniel Buron, certify that:
1.
2.
3.
4.
I have reviewed this annual report on Form 10-K of Domtar Corporation;
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 the
statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this
report;
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the
financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in
Exchange 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)
b)
c)
d)
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to
ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this report is being prepared; and
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our
supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for
external purposes in accordance with generally accepted accounting principles;
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures, as the end of the period covered by this report based on such evaluation; and
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent
fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to
materially affect, the registrant’s internal control over financial reporting; and
5.
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the
registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
a)
b)
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are
reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal
control over financial reporting.
Date: March 10, 2022
/s/ Daniel Buron
Daniel Buron
Executive Vice-President and Chief Financial Officer
CERTIFICATION BY THE CHIEF EXECUTIVE OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT
TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 32.1
The undersigned hereby certifies that to his knowledge, the Company’s Annual Report on Form 10-K for the period ended December 31, 2021 (the “Form
10-K”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-K
fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: March 10, 2022
/s/ John D. Williams
John D. Williams
President and Chief Executive Officer
CERTIFICATION BY THE CHIEF FINANCIAL OFFICER
PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT
TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 32.2
The undersigned hereby certifies that to his knowledge, the Company’s Annual Report on Form 10-K for the period ended December 31, 2021 (the “Form
10-K”) fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934 and information contained in the Form 10-K
fairly presents, in all material respects, the financial condition and results of operations of the Company.
Date: March 10, 2022
/s/ Daniel Buron
Daniel Buron
Executive Vice-President and Chief Financial Officer