Table of Contents
As filed with the Securities and Exchange Commission on March 28, 2016
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, 2015
Commission File No. 001-37636
Match Group, Inc.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction
of incorporation or organization)
8300 Douglas Avenue, Dallas, Texas
(Address of Registrant's principal executive offices)
26-4278917
(I.R.S. Employer Identification No.)
75225
(Zip Code)
(214) 576-9352
(Registrant's telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class
Common Stock, par value $0.001
Name of exchange on which registered
The Nasdaq Stock Market LLC
(Nasdaq Global Select Market)
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 o
No x
Indicate by check mark if the Registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes o
No x
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 x
No
o
Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted
and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the Registrant was required to submit and post such files). Yes
x
No o
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the
Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. x
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of
"large accelerated filer," "accelerated filer," and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer o
Accelerated filer o
Non-accelerated filer x
(Do not check if a smaller
reporting company)
Smaller reporting company o
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o
No x
As of January 29, 2016, the following shares of the Registrant's Common Stock were outstanding:
Common Stock
Class B Common Stock
Class C Common Stock
Total
38,364,777
209,919,402
—
248,284,179
As of June 30, 2015, the registrant’s common stock was not publicly traded.
Documents Incorporated By Reference:
Portions of the Registrant's proxy statement for its 2016 Annual Meeting of Stockholders are incorporated by reference into Part III herein.
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Business
Risk Factors
Unresolved Staff Comments
Properties
Legal Proceedings
Mine Safety Disclosure
TABLE OF CONTENTS
PART I
PART II
Market For Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Selected Financial Data
Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 1.
Item 1A.
Item 1B.
Item 2.
Item 3.
Item 4.
Item 5.
Item 6.
Item 7.
Item 7A.
Quantitative and Qualitative Disclosures About Market Risk
Item 8.
Item 9.
Item 9A.
Item 9B.
Item 10.
Item 11.
Item 12.
Item 13.
Item 14.
Consolidated and Combined Financial Statements and Supplementary Data
Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
Directors, Executive Officers and Corporate Governance
Executive Compensation
PART III
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accounting Fees and Services
Item 15.
Exhibits and Financial Statement Schedules
PART IV
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Item 1. Business
Who we are
PART I
Match Group is the world's leading provider of dating products. We operate a portfolio of over 45 brands, including Match, OkCupid, PlentyOfFish, Tinder,
Meetic, Twoo, OurTime, BlackPeopleMeet and FriendScout24, each designed to increase our users' likelihood of finding a romantic connection. Through our
portfolio of trusted brands, we provide tailored products to meet the varying preferences of our users. We currently offer our dating products in 38 languages across
more than 190 countries. Match Group operates in two segments: Dating and Non-dating.
Our target market includes all adults in North America, Western Europe and other select countries around the world who are not in a committed relationship and
who have access to the internet. Consumer preferences within this population vary significantly, influenced in part by demographics, geography, religion and
sensibility. As a result, the market for dating products is fragmented, and no single product has been able to effectively serve the dating category as a whole.
Given wide ranging consumer preferences, we approach the category with a brand portfolio strategy, through which we attempt to offer dating products that
collectively appeal to the broadest spectrum of consumers. We believe that this approach maximizes our ability to capture additional users. We increasingly apply a
centralized discipline to learnings, best practices and technologies across our brands in order to increase growth, reduce costs and maximize profitability. This
approach allows us to quickly introduce new products and features, optimize marketing strategies, reduce operating costs and more effectively deploy talent across our
organization.
Coinciding with the general trend toward mobile technology, we have experienced a meaningful shift in our user base from desktop devices to mobile devices,
and now offer mobile experiences on substantially all of our dating products. This shift has enabled us to reach groups of users which had previously proven elusive,
such as the millennial audience; for example, Tinder, a mobile-only product, has been able to tap into this audience rapidly over the last few years. Additionally, in
previously desktop-oriented products like Match, the shift to mobile has led to increased usage of our products, as mobile users on average access our products at
meaningfully higher rates than do those users who access our products on desktop.
In addition to our dating business, we also operate The Princeton Review, which provides a variety of test preparation, academic tutoring and college counseling
services.
Market opportunity
We believe that connecting with people and fostering relationships are critical needs that influence everyone's happiness. As a result, the dating market presents a
significant opportunity for Match Group. We consider our addressable market to be all adults in North America, Western Europe and other select countries around the
world who are not in committed relationships and who have access to the internet.
In countries with developed economies such as the United States, our addressable market has been expanding due to the aging population, increasing internet use
among older adults and growth in singles as a percent of the total population. In countries with emerging economies, such as India and China, growth in the
addressable market is driven by similar factors, most notably pronounced growth in internet access.
Enabling dating in a digital world
Prior to the proliferation of computers and mobile devices, human connections traditionally were limited by social circles, geography and time. Today, the
adoption of the internet and mobile technology has significantly expanded the ways in which people can build relationships, create new interactions and develop
romantic connections.
We believe that dating products serve as a natural extension of the traditional means of meeting people and provide a number of benefits for their users,
including:
•
•
Expanded options : Dating products provide users access to a large number of like-minded people they otherwise would not have a chance to meet.
Efficiency : The search and matching features, as well as the profile information available on dating products, allow users to filter a large number of options
in a short period of time, increasing the likelihood that users will make a connection with someone.
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• More comfort and control : Compared to the traditional ways that people meet, dating products provide an environment that makes the process of reaching
out to new people less uncomfortable. This leads to many people who would otherwise be passive participants in the dating process taking a more active role.
•
Convenience : The nature of the internet and the proliferation of mobile devices allow users to connect with new people at any time of the day, regardless of
where they are.
Depending on a person's circumstances at any given time, dating products can act as a supplement to, or substitute for, the traditional means of meeting people.
When selecting a dating product, we believe that users consider the following attributes:
•
•
•
•
Brand recognition : Brand is very important. Users generally associate strong dating brands with a higher likelihood of success and a higher level of
security. Successful dating brands typically depend on large, active communities of users, strong algorithmic filtering technology and awareness of
successful usage among similar users.
Successful experiences : Demonstrated success of other users attracts new users through word-of-mouth recommendations. Successful experiences also
drive repeat usage.
Community identification : Users typically look for dating products that offer a community with which the user most strongly associates. By selecting a
dating product that is focused on a particular demographic, religion, geography or intent (for example, casual dating or more serious relationships), users
can increase the likelihood that they will make a connection with someone with whom they may identify.
Product features and user experience : Users tend to gravitate towards dating products that offer features and user experiences that resonate with them, such
as question-based matching algorithms, location-based features, offline events or searching capabilities. User experience is also driven by the type of user
interface (for example, swiping versus scrolling), a particular mix of free and paid features, ease of use and security. Users expect every interaction with a
dating product to be seamless, intuitive and secure.
Our Dating portfolio
Dating is a highly personal endeavor and consumers have a wide variety of preferences that determine what type of dating product they choose. For example,
some users may look for a specific type of user interface, while others may look for a dating product that offers a community of people with similar demographic
characteristics or that has a particular mix of free and paid features.
As a result, we approach the category with a portfolio strategy in order to reach a broad range of users. Our portfolio consists of over 45 brands, available in 38
languages, and offered in over 190 countries. The following is a list of our key brands:
Match. Match was launched in 1995 and helped create the online dating category. Among its distinguishing features is the ability to both search profiles, receive
algorithmic matches and the ability to attend live events, promoted by Match, with other members. Because the ability to communicate between members is generally
a component of paid membership, Match has a high percentage of paying users which generally indicates a higher level of intent than some of our other brands. Match
relies heavily on word-of-mouth traffic, repeat usage and paid marketing, and has a relatively balanced age distribution across the single population.
Meetic. Meetic was founded in 2001 and enjoys market leadership by number of users in France, Spain, Italy and the Netherlands. Similar to Match, among its
distinguishing features is the ability to both search profiles and receive algorithmic matches, and the ability to attend live events, promoted by Meetic, with other
members. Also, similar to Match, because the ability to communicate between members is generally a component of paid membership, Meetic's high percentage of
paying users indicates a generally higher level of intent than some of our other brands. Meetic relies heavily on word-of-mouth traffic, repeat usage and paid
marketing, and has a relatively balanced age distribution across the single population.
OkCupid. OkCupid was launched in 2004, and has attracted users through a mathematical and Q&A approach to the category. Additionally, it has published
much of the data it collects in its popular blog, generating a bold and edgy reputation. OkCupid has grown meaningfully over the years without significant marketing
spend. OkCupid has a loyal user base in many major United States cities, which tends, on average, to be younger than the user base of Match.
Tinder. Tinder was launched in 2012, and has since risen to scale and popularity faster than any other product in the dating category. Tinder's mobile-only
offering and distinctive "right swipe" and location-based features have led to significant adoption among the millennial generation, previously underserved by the
dating category.
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PlentyOfFish. PlentyOfFish was launched in 2003 and acquired in October 2015. Similar to Match, among its distinguishing features is the ability to both search
profiles and receive algorithmic matches. Similar to OkCupid, PlentyOfFish has grown to popularity over the years with very limited marketing spend. PlentyOfFish
has broad appeal in the central United States, Canada, the United Kingdom and a number of other international markets.
OurTime, BlackPeopleMeet and our other affinity brands. Our affinity brands serve the needs of individuals for whom commonalities around age, religion,
ethnicity or circumstance are of fundamental importance when making a romantic connection. For example, OurTime is age-centric, and its user base is the largest
community of singles over age 50 of any dating product, while BlackPeopleMeet is race-centric.
Twoo. Twoo was founded in 2011 and has been highly successful in creating dating products seeded through existing social networks. Its viral acquisition tactics
and internationalized platform have enabled Twoo to rapidly expand in over 190 countries and 38 languages in a relatively short time. Twoo's user base is
concentrated in Europe, Asia and South America.
FriendScout24. Founded in 2007, FriendScout24 is the market leader in dating products in Germany with a strong presence in Austria and Switzerland. It is
characterized by its search-based product offering, in contrast to the "matching" products which are otherwise predominant in the German markets.
Product Features and Pricing. All our Dating products enable a user to establish a profile and review other people's profiles without charge. Each of them also
offers additional features, some of which are free, and some of which require payment depending on the particular product. In general, access to premium features
requires a paid membership, which is typically offered in packages from one-month to 12 months, depending on the product and circumstance. Prices differ
meaningfully within a given brand by the duration of membership purchased, by the bundle of paid features that a user chooses to access, and by whether or not a
customer is taking advantage of any special offers. In addition to paid memberships, many of our products now offer the user the ability to promote themselves for a
given period of time, or to review certain profiles without any signaling to the other members, and these features are offered on a pay-per-use basis. The precise mix
of paid and premium features is established over time on a brand-by-brand basis and is constantly subject to iteration and evolution.
Portfolio approach. The brands in our portfolio both compete and collaborate with each other. We attempt to empower individual business leaders with the
authority and incentives to grow each of our brands. Our businesses compete with each other and with third-party businesses in our category on brand characteristics,
product features, and business model. We also attempt to centrally facilitate excellence and efficiency across the entire portfolio by:
•
•
•
•
centralizing certain administrative areas, like legal, human resources and finance, across the entire portfolio to enable each brand to focus more on growth;
centralizing other areas across certain businesses where we have strength in personnel and sufficient commonality of business interest (for example, ad sales,
online marketing and technology centralized across some, but not all, businesses);
developing talent across the portfolio to allow for expertise development and career advancement while giving us the ability to deploy the best talent in the
most critical positions across the company at any given time; and
sharing data to leverage product and marketing successes across our businesses rapidly for competitive advantage.
Our Non-dating business
In addition to our Dating business, we also operate The Princeton Review, which provides a variety of educational test preparation, academic tutoring and college
counseling services. The Princeton Review includes Tutor.com (acquired in 2012) and The Princeton Review (acquired in 2014). Our Non-dating businesses rely on
many of the same competencies as our Dating business, such as paid customer acquisition, a combination of free and paid features, deep understanding of the lifetime
values of customers, and strong expertise in user interface development.
Revenue
Our Dating revenue is primarily derived directly from users in the form of recurring membership fees, which typically provide unlimited access to a bundle of
features for a specific period of time, and the balance from à la carte features, where users pay a fee for a specific action or event. Each of our brands offers a
combination of free and paid features targeted to its unique community. On a brand-by-brand basis, our monetization decisions seek to optimize user growth, revenue
and the vibrancy and productivity of the relevant community of users. In addition to direct revenue from our users, we generate revenue from online advertising.
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Non-dating revenue consists primarily of fees received directly from students for in-person and online test preparation classes, access to online test preparation
materials and individual tutoring services.
Sales and marketing
We attract the majority of our users through word-of-mouth and other free channels. In addition, many of our brands rely on paid customer acquisition for a
significant percentage of their users. Our online marketing activities generally consist of purchasing banner and other display advertising, search engine marketing,
email campaigns and business development or partnership deals. Our offline marketing activities generally consist of television advertising and related public
relations efforts, as well as events.
Technology
Consistent with our general operating philosophy, each of our brands tends to develop its own technology systems to support its product, leveraging both open-
source and vendor supported software technology. Each of our brands has dedicated engineering teams responsible for software development and creation of new
features to support our products across the full range of devices, from desktop to mobile-web to native mobile applications. Our engineering teams use an agile
development process, allowing us to deploy frequent iterative releases for product features. The Company spent $67.3 million, $49.7 million and $43.0 million in the
fiscal years ended December 31, 2015, 2014 and 2013, respectively, on product development.
We are currently working to modernize the software and technology supporting certain of our North American brands and to consolidate their back-end services
such as billing and payments, online marketing, chat and photos, as well as reusable API services that will be leveraged by an adaptive desktop and mobile web front
end unique to each brand. This will, among other things, allow us to be more efficient in terms of ongoing development on our desktop platform while being able to
deploy a greater percentage of our total development resources to our mobile products. We will continue to support brand-specific native mobile applications that will
integrate to the common back-end and API services layer. Similar efforts are underway at Meetic and our other predominantly European brands. We expect these
initiatives will allow us to increase speed to market, reduce execution time and drive cost efficiencies.
We host the majority of our brands in leased data centers located within the general geography served by the brand. Other brands utilize Amazon Web Services to
support their infrastructure.
Competition
The dating industry is competitive and has no single, dominant brand. We compete primarily with other companies that provide similar dating and matchmaking
products, including eHarmony, Spark Networks (Jdate, ChristianMingle), Zoosk, Parship, ElitePartner, e-Darling and Badoo.
In addition to other online dating brands, we compete indirectly with offline dating services, such as in-person matchmakers, and social media platforms.
Arguably, our biggest competition comes from the traditional ways that people meet each other, and the choices some people make to not utilize dating products or
services.
We believe that our ability to compete successfully will depend primarily upon the following factors:
•our ability to increase consumer acceptance of dating products;
•the continued strength of our brands;
•the breadth and depth of our active communities of users relative to our competitors;
•our ability to evolve our products in response to our competitors' offerings, user requirements, social trends and the technological landscape;
•our ability to efficiently acquire new users for our products;
•our ability to continue to optimize our monetization strategies; and
•the design and functionality of our products.
A large portion of users in our category use multiple dating products over a given period of time, either concurrently or sequentially , making our broad portfolio
of brands a competitive advantage.
.
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Intellectual property
We regard our intellectual property rights, including trademarks, domain names and other intellectual property, as critical to our success.
For example, we rely heavily upon the use of trademarks (primarily Match, Meetic, OkCupid, OurTime, Tinder and The Princeton Review, and associated
domain names, taglines and logos) to market our dating products and applications and build and maintain brand loyalty and recognition. We have an ongoing
trademark and service mark registration program, pursuant to which we register our brand names and product names, taglines and logos and renew existing trademark
and service mark registrations in the United States and other jurisdictions to the extent we determine it to be necessary or otherwise appropriate and cost-effective. In
addition, we have a trademark and service mark monitoring policy pursuant to which we monitor applications filed by third parties to register trademarks and service
marks that may be confusingly similar to ours, as well as potential unauthorized use of our material trademarks and service marks. Our enforcement of this policy
affords us valuable protection under current laws, rules and regulations. We also reserve and file registrations (to the extent available) and renew existing registrations
for domain names that we believe are material to our business.
We also rely upon a combination of in-licensed third-party and proprietary trade secrets, including proprietary algorithms, and to a lesser extent, upon patented
and patent-pending technologies, processes and features relating to our matching process systems or related features, products and services with expiration dates from
2025 to 2034. We have an ongoing invention recognition program pursuant to which we apply for patents to the extent we determine it to be necessary or otherwise
appropriate and cost-effective.
We rely on a combination of internal and external controls, including applicable laws, rules and regulations and contractual restrictions with employees,
contractors, customers, suppliers, affiliates and others, to establish, protect and otherwise control access to our various intellectual property rights.
Government regulation
We are subject to foreign and domestic laws and regulations that affect companies conducting business on the internet generally, including laws relating to the
liability of providers of online services for their operations and the activities of their users. As a result, we could be subject to actions based on negligence, various
torts and trademark and copyright infringement, among other actions. See "Risk factors—Risks relating to our business—Inappropriate actions by certain of our users
could be attributed to us and damage our brands' reputation, which in turn could adversely affect our business" and "—Risks relating to our business—We may fail to
adequately protect our intellectual property rights or may be accused of infringing the intellectual property rights of third parties."
Because we receive, store and use a substantial amount of information received from or generated by our users, we are also impacted by laws and regulations
governing privacy, use of personal data and data breaches, primarily in the case of our operations in the European Union. As a result, we could be subject to various
private and governmental claims and actions. See "Risk factors—Risks relating to our business—Unauthorized access of personal data could give rise to liabilities as
a result of governmental regulation, conflicting legal requirements or differing views of personal privacy rights."
As the provider of dating products with a membership-based element, we are also subject to laws and regulations in certain U.S. states and other countries that
apply to our automatically-renewing membership payment models. Finally, certain U.S. states and certain countries in Asia have laws that specifically govern dating
services.
Financial information about segments and geographic areas
The segment and geographic information required herein is set forth in "Item 7- Management's Discussion and Analysis of Financial Condition and Results of
Operations" and "Item 8- Consolidated and Combined Financial Statements and Supplementary Data."
Employees
As of December 31, 2015, we had approximately 1,500 full-time employees and approximately 3,300 part-time employees worldwide. Substantially all of our
part-time employees are employed by our Non-dating businesses and perform academic tutoring, test preparation and college counseling services. We are not subject
to any collective bargaining agreements and believe that our relationship with our employees is good.
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Additional Information
Corporate information. We were incorporated in the State of Delaware on February 12, 2009 as a wholly-owned subsidiary of IAC/InterActiveCorp ("IAC").
Company website and public filings. The Company maintains a website at www.matchgroupinc.com . Neither the information on the Company's website, nor the
information on the website of any Match Group business, is incorporated by reference into this annual report, or into any other filings with, or into any other
information furnished or submitted to, the Securities and Exchange Commission ("SEC").
The Company makes available, free of charge through its website, its Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q and Current Reports on
Form 8-K (including related amendments) as soon as reasonably practicable after they have been electronically filed with (or furnished to) the SEC.
Code of ethics. The Company's code of ethics applies to all employees (including Match Group's principal executive officers (its Chairman and Chief Executive
Officer), principal financial officer (its Chief Financial Officer) and principal accounting officer (its Vice President and Principal Accounting Officer)) and directors
and is posted on the Company's website at http://ir.mtch.com/phoenix.zhtml?c=254224&p=irol-govHighlights. This code of ethics complies with Item 406 of SEC
Regulation S-K and the rules of The Nasdaq Stock Market LLC. Any changes to the code of ethics that affect the provisions required by Item 406 of Regulation†S-K,
and any waivers of such provisions of the code of ethics for Match Group's executive officers, senior financial officers or directors, will also be disclosed on Match
Group's website.
Relationship with IAC
Equity ownership and vote. Match Group has outstanding shares of common stock, with one vote per share, and shares of Class B common stock, with ten votes
per shares and which are convertible into common stock on a share for share basis. As of January 29, 2016, IAC owned 209,919,402 shares of Class B common stock
representing 100% of our outstanding Class B common stock, approximately 84.5% of our outstanding shares of capital stock and approximately 98.2% of the
combined voting power of our outstanding capital stock
Intercompany agreements. In connection with the initial public offering of our common stock in November 2015, we entered into certain agreements relating to
our relationship with IAC after the offering. These agreements include, among others, the five agreements described below.
Master transaction agreement. The master transaction agreement sets forth the agreements between us and IAC regarding the principal transactions necessary to
separate our business from IAC, as well as governs certain aspects of our relationship with IAC after the completion of the offering.
Investor rights agreement. Under the investor rights agreement, we are obligated to provide IAC with certain registration and other rights relating to the shares of
our common stock it holds and anti-dilution rights.
Tax sharing agreement. The tax sharing agreement governs our and IAC's rights, responsibilities, and obligations with respect to tax liabilities and benefits,
entitlements to refunds, the preparation of tax returns, tax contests and other tax matters regarding U.S. federal, state, local and foreign income taxes.
Services agreement. The services agreement governs services IAC will provide through November 24, 2016 (one year from the date of the completion of the
offering), with automatic renewal, subject to IAC’s continued ownership of a majority of the combined voting power of our voting stock and any subsequent
extension or truncation agreed to by us and IAC.
Employee matters agreement. The employee matters agreement covers a wide range of compensation and benefit issues related to the allocation of liabilities
associated with: (i) employment or termination of employment, (ii) employee benefit plans and (iii) equity awards. In the event IAC no longer retains shares
representing at least 80% of the aggregate voting power of shares entitled to vote in the election of our board of directors, we will no longer participate in IAC’s
employee benefit plans, but will establish our own employee benefit plans that will be substantially similar to the plans sponsored by IAC.
For additional information regarding these agreements, see "Item 8- Consolidated and Combined Financial Statements-Note 17."
Item 1A. Risk Factors
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Cautionary Statement Regarding Forward-Looking Information
This annual report on Form 10-K contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The use of
words such as “anticipates,” “estimates,” “expects,” “plans” and “believes,” among others, generally identify forward-looking statements. These forward-looking
statements include, among others, statements relating to: Match Group's future financial performance, Match Group's business prospects and strategy, anticipated
trends and prospects in the industries in which Match Group’s businesses operate and other similar matters. These forward-looking statements are based on Match
Group management's expectations and assumptions about future events as of the date of this annual report, which are inherently subject to uncertainties, risks and
changes in circumstances that are difficult to predict.
Actual results could differ materially from those contained in these forward-looking statements for a variety of reasons, including, among others, the risk factors
set forth below. Other unknown or unpredictable factors that could also adversely affect Match Group’s business, financial condition and results of operations may
arise from time to time. In light of these risks and uncertainties, the forward-looking statements discussed in this annual report may not prove to be accurate.
Accordingly, you should not place undue reliance on these forward-looking statements, which only reflect the views of Match Group's management as of the date of
this annual report. Match Group does not undertake to update these forward-looking statements.
Risks relating to our business
The limited operating history of our newer dating brands and products makes it difficult to evaluate our current business and future prospects.
We seek to tailor each of our dating brands and products to meet the preferences of specific communities of users. Building a given brand or product is generally
an iterative process that occurs over a meaningful period of time and involves considerable resources and expenditures. Although certain of our newer brands and
products have experienced significant growth over relatively short periods of time, you cannot necessarily rely on the historical growth rates of these brands and
products as an indication of future growth rates for our newer brands and products generally. We have encountered, and may continue to encounter, risks and
difficulties as we build our newer brands and products. The failure to successfully address these risks and difficulties could adversely affect our business, financial
condition and results of operations.
The dating industry is competitive, with low switching costs and a consistent stream of new products and entrants, and innovation by our competitors may disrupt
our business.
The dating industry is competitive, with a consistent stream of new products and entrants. Some of our competitors may enjoy better competitive positions in
certain geographical regions or user demographics that we currently serve or may serve in the future. These advantages could enable these competitors to offer
products that are more appealing to users and potential users than our products or to respond more quickly and/or cost-effectively than us to new or changing
opportunities.
In addition, within the dating industry generally, costs for consumers to switch between products are low, and consumers have a propensity to try new approaches
to connecting with people. As a result, new products, entrants and business models are likely to continue to emerge. It is possible that a new product could gain rapid
scale at the expense of existing brands through harnessing a new technology or distribution channel, creating a new approach to connecting people or some other
means. If we are not able to compete effectively against our current or future competitors and products that may emerge, the size and level of engagement of our user
base may decrease, which could have an adverse effect on our business, financial condition and results of operations.
Each of our dating products monetizes users at different rates. If a meaningful migration of our user base from our higher monetizing dating products to our
lower monetizing dating products were to occur, it could adversely affect our business, financial condition and results of operations.
We own, operate and manage a large and diverse portfolio of dating products. Each dating product has its own mix of free and paid features designed to optimize
the user experience and revenue generation from that product's community of users. In general, the mix of features for the various dating products within our more
established brands leads to higher monetization rates per user than the mix of features for the various dating products within our newer brands. If a significant portion
of our
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user base were to migrate to our less profitable brands, our business, financial condition and results of operations could be adversely affected. See "Management's
discussion and analysis of financial condition and results of operations—Trends affecting our Dating business."
Our growth and profitability rely, in part, on our ability to attract and retain users through cost-effective marketing efforts. Any failure in these efforts could
adversely affect our business, financial condition and results of operations.
Attracting and retaining users for our dating products involve considerable expenditures for online and offline marketing. Historically, we have had to increase
our marketing expenditures over time in order to attract and retain users and sustain our growth.
Evolving consumer behavior can affect the availability of profitable marketing opportunities. For example, as traditional television viewership declines and as
consumers spend more time on mobile devices rather than desktop computers, the reach of many of our traditional advertising channels is contracting. Similarly, as
consumers communicate less via email and more via text messaging and other virtual means, the reach of email campaigns designed to attract new and repeat users
(and retain current users) for our dating products is adversely impacted. To continue to reach potential users and grow our businesses, we must identify and devote
more of our overall marketing expenditures to newer advertising channels, such as mobile and online video platforms, as well as targeted campaigns in which we
communicate directly with potential, former and current users via new virtual means. Generally, the opportunities in and sophistication of newer advertising channels
are relatively undeveloped and unproven, and there can be no assurance that we will be able to continue to appropriately manage and fine-tune our marketing efforts
in response to these and other trends in the advertising industry. Any failure to do so could adversely affect our business, financial condition and results of operations.
Communicating with our users via email is critical to our success, and any erosion in our ability to communicate in this fashion that is not sufficiently replaced by
other means could adversely affect our business, financial condition and results of operations.
As consumer habits evolve in the era of smart phones and messaging/social networking apps, usage of email, particularly among our younger users, has declined.
In addition, deliverability restrictions imposed by third party email providers could limit or prevent our ability to send emails to our users. One of our primary means
of communicating with our users and keeping them engaged with our products is via email. Our ability to communicate via email enables us to keep our users updated
on activity with respect to their profile, present or suggest new or interesting users from the community, invite them to offline events and present discount and free
trial offers, among other things. Any erosion in our ability to communicate successfully with our users via email could have an adverse impact on user experience and
the rate at which non-paying users become paid members.
While we continually work to find new means of communicating and connecting with our members (for example, through push notifications), there is no
assurance that such alternative means of communication will be as effective as email has been. Any failure to develop or take advantage of new means of
communication could have an adverse effect on our business, financial condition and results of operations.
Our quarterly results or operating metrics could fluctuate significantly, which could cause the trading price of our common stock to decline.
Our quarterly results and operating metrics have fluctuated historically and we expect that they could continue to fluctuate in the future as a result of a number of
factors, many of which are outside of our control and may be difficult to predict, including:
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the timing, size and effectiveness of our marketing efforts;
fluctuations in the rate at which we attract new users, the level of engagement of such users and the propensity of such users to subscribe to our brands or to
purchase à la carte features;
increases or decreases in our revenues and expenses caused by fluctuations in foreign currency exchange rates;
the timing, size and effectiveness of non-marketing operating expenses that we may incur to grow and expand our operations and to remain competitive;
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the performance, reliability and availability of our technology, network systems and infrastructure and data centers;
operational and financial risks we may experience in connection with historical and potential future acquisitions; and
general economic conditions in either domestic or international markets.
The occurrence of any one of these factors, as well as other factors, or the cumulative effect of the occurrence of one or more of such factors could cause our
quarterly results and operating metrics to fluctuate significantly. As a result, quarterly comparisons of results and operating metrics may not be meaningful.
In addition, the variability and unpredictability of our quarterly results or operating metrics could result in our failure to meet our expectations, or those of any of
our investors or of analysts that cover our company, with respect to revenues or other operating results for a particular period. If we fail to meet or exceed such
expectations for these or any other reasons, the market price of our common stock could fall substantially.
Foreign currency exchange rate fluctuations could adversely affect our results of operations.
We operate in various international markets, primarily in various jurisdictions within the European Union. During the fiscal fiscal years ended December 31,
2015 and 2014, 32% and 35% of our total revenues, respectively, were international revenues. Our primary exposure to foreign currency exchange risk relates to
investments in foreign subsidiaries that transact business in a functional currency other than the U.S. dollar, primarily the Euro.
As foreign currency exchange rates fluctuate, the translation of our international results into U.S. dollars affects the period-over-period comparability of our U.S
dollar-denominated operating results. For example, the average Euro to U.S. dollar exchange rate was 16% lower in the fiscal year ended December 31, 2015 than it
was in the fiscal year ended December 31, 2014, which significantly reduced our revenue. Our total revenue, Dating revenue and International Dating revenue for the
fiscal year ended December 31, 2015, as compared to the fiscal year ended December 31, 2014, would have increased approximately 20%, 15% and 21%,
respectively, as compared to the reported increases of 15%, 9% and 3%, respectively, had foreign currency exchange rates remained constant during such period.
Historically, we have not hedged any foreign currency exposures. The continued growth and expansion of our international operations into new countries
increases our exposure to foreign exchange rate fluctuations. These fluctuations could have a significant impact on our future results of operations.
Distribution and use of our dating products depends, in significant part, on a variety of third party publishers, platforms and mobile app stores. If these third
parties limit, prohibit or otherwise interfere with the distribution or use of our dating products in any material way, it could adversely affect our business,
financial condition and results of operations.
We market and distribute our dating products (including related mobile applications) through a variety of third party publishers and distribution channels. Our
ability to market our brands on any given property or channel is subject to the policies of the relevant third party. Certain publishers and channels have, from time to
time, limited or prohibited advertisements for dating products for a variety of reasons, including as a result of poor behavior by other industry participants. There is no
assurance that we will not be limited or prohibited from using certain current or prospective marketing channels in the future. If this were to happen in the case of a
significant marketing channel and/or for a significant period of time, our business, financial condition and results of operations could be adversely affected.
Additionally, our mobile applications are increasingly accessed through the Apple App Store and the Google Play Store. Both Apple and Google have broad
discretion to change their respective terms and conditions applicable to the distribution of our applications, and to interpret their respective terms and conditions in
ways that may limit, eliminate or otherwise interfere with our ability to distribute our applications through their stores. There is no assurance that Apple or Google
will not limit or eliminate or otherwise interfere with the distribution of our applications. If either or both of them did so, our business, financial condition and results
of operations could be adversely affected.
Lastly, in the case of Tinder, users currently register for (and log in to) the application exclusively through their Facebook profiles. Facebook has broad discretion
to change its terms and conditions applicable to the use of its platform in this manner and to interpret its terms and conditions in ways that could limit, eliminate or
otherwise interfere with our ability to use
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Facebook in this manner and if Facebook did so, our business, financial condition and results of operations could be adversely affected.
As the distribution of our dating products through app stores increases, in order to maintain our profit margins, we may need to offset increasing app store fees by
decreasing traditional marketing expenditures, increasing user volume or monetization per user or by engaging in other efforts to increase revenue or decrease
costs generally, or our business, financial condition and results of operations could be adversely affected.
As our user base continues to shift to mobile solutions, we increasingly rely on the Apple App Store and the Google Play Store to distribute our mobile
applications and related in-app products. While our mobile applications are generally free to download from these stores, we offer our users the opportunity to
purchase paid memberships and certain à la carte features through these applications. We determine the prices at which these memberships and features are sold and,
in exchange for facilitating the purchase of these memberships and features through these applications to users who download our applications from these stores, we
pay Apple and Google, as applicable, a share (currently 30%) of the revenue we receive from these transactions. As the distribution of our dating products through
app stores increases, we may need to offset these increased app store fees by decreasing traditional marketing expenditures as a percentage of revenue, increasing user
volume or monetization per user, or by engaging in other efforts to increase revenue or decrease costs generally, or our business, financial condition and results of
operations could be adversely affected.
Our success depends, in part, on the integrity of our systems and infrastructures and on our ability to enhance, expand and adapt these systems and
infrastructures in a timely and cost-effective manner.
In order for us to succeed, our systems and infrastructures must perform well on a consistent basis. From time to time, we may experience system interruptions
that make some or all of our systems or data unavailable and prevent our products from functioning properly for our users; any such interruption could arise for any
number of reasons. Further, our systems and infrastructures are vulnerable to damage from fire, power loss, telecommunications failures and similar events. While we
have backup systems in place for certain aspects of our operations, our systems and infrastructures are not fully redundant, disaster recovery planning is not sufficient
for all eventualities and our property and business interruption insurance coverage may not be adequate to compensate us fully for any losses that we may suffer. Any
interruptions or outages, regardless of the cause, could negatively impact our users' experiences with our products, tarnish our brands' reputation and decrease demand
for our products, any or all of which could adversely affect our business, financial condition and results of operations.
We also continually work to expand and enhance the efficiency and scalability of our technology and network systems to improve the experience of our users,
accommodate substantial increases in the volume of traffic to our various dating products and to keep up with changes in technology and user preference. Any failure
to do so in a timely and cost-effective manner could adversely affect our users' experience with our various products and thereby negatively impact the demand for our
products, and could increase our costs, either of which could adversely affect our business, financial condition and results of operations.
We are currently undertaking a significant and complex update to the technology relating to some of our businesses, and failure to complete this project in a
timely and effective manner could adversely affect our business.
We are currently in the process of an ongoing consolidation and streamlining of the technology and network systems and infrastructures of a number of our
businesses, including Match, OurTime and Meetic. The goal of this project is to modernize, optimize and improve the scalability and cost-effectiveness of these
systems and infrastructures and to increase our ability to deploy product changes more rapidly across devices and product lines. We have budgeted significant human
and financial resources for these efforts and if we experience delays, inefficiencies or operational failures, we will incur additional costs, which would adversely affect
our profitability. Moreover, these efforts may not be successful generally, may not be completed in a timely or cost-effective manner, may not result in the cost
savings or other benefits we anticipate and may disrupt operations, any or all of which could adversely affect our business, financial condition and results of
operations.
We may not be able to protect our systems and infrastructures from cyber attacks and may be adversely affected by cyber attacks experienced by third parties.
We are regularly under attack by perpetrators of random or targeted malicious technology-related events, such as cyber attacks, computer viruses, worms or other
destructive or disruptive software, distributed denial of service attacks and attempts
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to misappropriate customer information, including credit card information. While we have invested heavily in the protection of our systems and infrastructures and in
related training, there can be no assurance that our efforts will prevent significant breaches in our systems or other such events from occurring. Any cyber or similar
attack we are unable to protect ourselves against could damage our systems and infrastructure, prevent us from providing our products, erode our reputation and
brands, result in the disclosure of confidential information of our users and/or be costly to remedy.
The impact of cyber security events experienced by third parties with whom we do business (or upon whom we otherwise rely in connection with our day-to day
operations) could have a similar effect on us. Moreover, even cyber or similar attacks that do not directly affect us or third parties with whom we do business may
result in a loss of consumer confidence generally, which could make users less likely to use or continue to use our products. The occurrence of any of these events
could have an adverse effect on our business, financial condition and results of operations.
Our success depends, in part, on the integrity of third party systems and infrastructures.
We rely on third parties, primarily data center service providers, as well as third party computer systems, broadband and other communications systems and
service providers, in connection with the provision of our products generally, as well as to facilitate and process certain transactions with our users. We have no
control over any of these third parties or their operations.
Problems experienced by third party data center service providers upon whom we rely, the telecommunications network providers with whom they contract or
with the systems through which telecommunications providers allocate capacity among their customers could also adversely affect us. Any changes in service levels
at our data centers or any interruptions, outages or delays in our systems or those of our third party providers, or deterioration in the performance of these systems,
could impair our ability to provide our products or process transactions with our users, which would adversely impact our business, financial condition and results of
operations.
If the security of personal and confidential user information that we maintain and store is breached or otherwise accessed by unauthorized persons, it may be
costly to mitigate the impact of such an event and our reputation could be harmed.
We receive, process, store and transmit a significant amount of personal user and other confidential information, including credit card information, and enable our
users to share their personal information with each other. In some cases, we retain third party vendors to store this information. We continuously develop and maintain
systems to protect the security, integrity and confidentiality of this information, but cannot guarantee that inadvertent or unauthorized use or disclosure will not occur
or that third parties will not gain unauthorized access to this information despite our efforts. If any such event were to occur, we may not be able to remedy the event,
and we may have to expend significant capital and resources to mitigate the impact of such an event, and to develop and implement protections to prevent future
events of this nature from occurring. If a breach of our security (or the security of our vendors and partners) occurs, the perception of the effectiveness of our security
measures and our reputation may be harmed, we could lose current and potential users and the recognition of our various brands and their competitive positions could
be diminished, any or all of which could adversely affect our business, financial condition and results of operations.
Unauthorized access of personal data could give rise to liabilities as a result of governmental regulation, conflicting legal requirements or differing views of
personal privacy rights.
Security breaches or other unauthorized access to, or the use or transmission of, personal user information could result in a variety of claims against us, including
privacy-related claims. There are numerous laws in the countries in which we operate regarding privacy and the storage, sharing, use, processing, disclosure and
protection of this kind of information, the scope of which are changing, inconsistent and conflicting and subject to differing interpretations. For example, the
European Commission has proposed and is currently debating comprehensive privacy and data protection reforms in the European Union, certain developing
countries in which we do business are currently considering adopting privacy and data protection laws and regulations, and legislative proposals concerning privacy
and the protection of user information are often pending before the U.S. Congress and various U.S. state legislatures.
While we believe that we comply with industry standards and applicable laws and industry codes of conduct relating to privacy and data protection, there is no
assurance that we will not be subject to claims that we have violated applicable laws or codes of conduct or that we will be able to successfully defend against such
claims.
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Any failure or perceived failure by us (or the third parties with whom we have contracted to store such information) to comply with applicable privacy laws,
privacy policies or privacy-related contractual obligations or any compromise of security that results in unauthorized access to personal information may result in
governmental enforcement actions, significant fines, litigation, claims of breach of contract and indemnity by third parties and adverse publicity. In the case of such an
event, our reputation may be harmed, we could lose current and potential users and the competitive positions of our various brands could be diminished, any or all of
which could adversely affect our business, financial condition and results of operations.
We are subject to a number of risks related to credit card payments, including data security breaches and fraud that we or third parties experience or additional
regulation, any of which could adversely affect our business, financial condition and results of operations.
We accept payment from our users primarily through credit card transactions and certain online payment service providers. The ability to access credit card
information on a real time-basis without having to proactively reach out to the consumer each time we process an auto-renewal payment or a payment for the purchase
of a premium feature on any of our dating products is critical to our success.
When we or a third party experiences a data security breach involving credit card information, affected cardholders will often cancel their credit cards. In the case
of a breach experienced by a third party, the more sizable the third party's customer base and the greater the number of credit card accounts impacted, the more likely
it is that our users would be impacted by such a breach. To the extent our users are ever affected by such a breach experienced by us or a third party, affected users
would need to be contacted to obtain new credit card information and process any pending transactions. It is likely that we would not be able to reach all affected
users, and even if we could, some users' new credit card information may not be obtained and some pending transactions may not be processed, which could adversely
affect our business, financial condition and results of operations.
Even if our users are not directly impacted by a given data security breach, they may lose confidence in the ability of service providers to protect their personal
information generally, which could cause them to stop using their credit cards online and choose alternative payment methods that are not as convenient for us or
restrict our ability to process payments without significant user effort.
Additionally, if we fail to adequately prevent fraudulent credit card transactions, we may face fines, governmental enforcement action, civil liability, diminished
public perception of our security measures, significantly higher credit card-related costs and substantial remediation costs, any of which could adversely affect our
business, financial condition and results of operations.
Finally, the passage or adoption of any legislation or regulation affecting the ability of service providers to periodically charge consumers for recurring
membership payments may adversely affect our business, financial condition and results of operations.
Inappropriate actions by certain of our users could be attributed to us and damage our brands' reputation, which in turn could adversely affect our business.
The reputation of our brands may be adversely affected by the actions of our users that are deemed to be hostile, offensive, defamatory, inappropriate or unlawful.
While we monitor and review the appropriateness of the content accessible through our dating products and have adopted policies regarding illegal or offensive use of
our dating products, our users could nonetheless engage in activities that violate our policies. These safeguards may not be sufficient to avoid harm to our reputation
and brands, especially if such hostile, offensive or inappropriate use is well-publicized.
In addition, it is possible that a user of our products could be physically, financially, emotionally or otherwise harmed by an individual that such user met through
the use of one of our products. If one or more of our users suffers or alleges to have suffered any such harm, we could experience negative publicity or legal action
that could damage our reputation and our brands. Similar events affecting users of our competitors' dating products could result in negative publicity for the dating
industry generally, which could in turn negatively affect our business. Concerns about such harms and the use of dating products and social networking platforms for
illegal conduct, such as romance scams and financial fraud, could produce future legislation or other governmental action that could require changes to our dating
products, restrict or impose additional costs upon the conduct of our business generally or cause users to abandon our dating products.
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We may fail to adequately protect our intellectual property rights or may be accused of infringing the intellectual property rights of third parties.
We rely heavily upon our trademarks and related domain names and logos to market our brands and to build and maintain brand loyalty and recognition, as well
as upon trade secrets. We also rely, to a lesser extent, upon patented and patent-pending proprietary technologies relating to matching process systems and related
features and products.
We also rely on a combination of laws, and contractual restrictions with employees, customers, suppliers, affiliates and others, to establish and protect our various
intellectual property rights. For example, we have generally registered and continue to apply to register and renew, or secure by contract where appropriate,
trademarks and service marks as they are developed and used, and reserve, register and renew domain names as we deem appropriate. Effective trademark protection
may not be available or may not be sought in every country in which our products are made available and contractual disputes may affect the use of marks governed
by private contract. Similarly, not every variation of a domain name may be available or be registered, even if available.
We also generally seek to apply for patents or for other similar statutory protections as and if we deem appropriate, based on then-current facts and
circumstances, and will continue to do so in the future. No assurances can be given that any patent application we have filed or will file will result in a patent being
issued, or that any existing or future patents will afford adequate protection against competitors and similar technologies. In addition, no assurances can be given that
third parties will not create new products or methods that achieve similar results without infringing upon patents we own.
Despite these measures, our intellectual property rights may still not be protected in a meaningful manner, challenges to contractual rights could arise or third
parties could copy or otherwise obtain and use our intellectual property without authorization. The occurrence of any of these events could result in the erosion of our
brands and limit our ability to market our brands using our various domain names, as well as impede our ability to effectively compete against competitors with
similar technologies, any of which could adversely affect our business, financial condition and results of operations.
From time to time, we have been subject to legal proceedings and claims, including claims of alleged infringement of trademarks, copyrights, patents and other
intellectual property rights held by third parties. In addition, litigation may be necessary in the future to enforce our intellectual property rights, protect our trade
secrets or to determine the validity and scope of proprietary rights claimed by others. Any litigation of this nature, regardless of outcome or merit, could result in
substantial costs and diversion of management and technical resources, any of which could adversely affect our business, financial condition and results of operations.
We operate in various international markets, including certain markets in which we have limited experience. As a result, we face additional risks in connection
with certain of our international operations.
Our brands are available in over 190 countries. Our international revenue represented 32% and 35% of our total revenue for the fiscal years ended December 31,
2015 and 2014, respectively.
Operating internationally, particularly in countries in which we have limited experience, exposes us to a number of additional risks, including:
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operational and compliance challenges caused by distance, language and cultural differences;
difficulties in staffing and managing international operations;
differing levels of social and technological acceptance of our dating products or lack of acceptance of them generally;
foreign currency fluctuations;
restrictions on the transfer of funds among countries and back to the United States and costs associated with repatriating funds to the United States;
differing and potentially adverse tax laws;
• multiple, conflicting and changing laws, rules and regulations, and difficulties understanding and ensuring compliance with those laws by both our
employees and our business partners, over whom we exert no control;
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competitive environments that favor local businesses;
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limitations on the level of intellectual property protection; and
trade sanctions, political unrest, terrorism, war and epidemics or the threat of any of these events.
The occurrence of any or all of the events described above could adversely affect our international operations, which could in turn adversely affect our business,
financial condition and results of operations.
We may experience operational and financial risks in connection with acquisitions.
We have made numerous acquisitions in the past and we continue to seek potential acquisition candidates. We may experience operational and financial risks in
connection with historical and future acquisitions if we are unable to:
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properly value prospective acquisitions, especially those with limited operating histories;
successfully integrate the operations, as well as the accounting, financial controls, management information, technology, human resources and other
administrative systems, of acquired businesses with our existing operations and systems;
successfully identify and realize potential synergies among acquired and existing businesses;
retain or hire senior management and other key personnel at acquired businesses; and
successfully manage acquisition-related strain on our management, operations and financial resources and those of the various brands in our portfolio.
Furthermore, we may not be successful in addressing other challenges encountered in connection with our acquisitions. The anticipated benefits of one or more of
our acquisitions may not be realized or the value of goodwill and other intangible assets acquired could be impacted by one or more continuing unfavorable events or
trends, which could result in significant impairment charges. The occurrence of any these events could have an adverse effect on our business, financial condition and
results of operations.
We will incur some increased costs and devote substantial management time as a result of operating as a public company.
The obligations of being a public company, including public reporting and investor relations obligations, require (and will continue to require) new expenditures,
place new demands on our management and will require the hiring of additional personnel. While IAC has provided (and will continue to provide) us with certain
corporate and shared services related to corporate functions for a period of time for negotiated fees, we also expect that we will need to implement additional systems
and hire additional personnel to adequately function as a public company. We cannot precisely predict the amount and timing of these significant expenditures. See
"—Risks related to our ongoing relationship with IAC—The services that IAC provides to us may not be sufficient to meet our needs, and we may have difficulty
finding replacement services or be required to pay increased costs to replace these services if we no longer receive these services from IAC."
We may not realize the potential benefits from our initial public offering.
We may not realize the benefits that we anticipate from our initial public offering. These benefits include the following:
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enabling us to allocate our capital more efficiently;
providing us with direct access to the debt and equity capital markets;
improving our ability to pursue acquisitions through the use of shares of our common stock as consideration; and
enhancing our market recognition with investors.
We may not achieve the anticipated benefits from our initial public offering for a variety of reasons. For example, the process of operating as an independent
public company may distract our management from focusing on our business and strategic priorities. In addition, although we will have direct access to the debt and
equity capital markets following this offering, we may not be able to issue debt or equity on terms acceptable to us or at all. The availability of tradable shares of our
common stock for use as consideration for acquisitions also will not ensure that we will be able to successfully pursue acquisitions or that the acquisitions will be
successful. We also may not fully realize the anticipated benefits from our initial
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public offering if any of the matters identified as risks in this "Risk factors" section were to occur. If we do not realize the anticipated benefits from our initial public
offering for any reason, our business may be adversely affected.
We are subject to litigation and adverse outcomes in such litigation could have an adverse effect on our financial condition.
We are, and from time to time may become, subject to litigation and various legal proceedings, including litigation and proceedings related to intellectual
property matters, privacy and consumer protection laws, as well as stockholder derivative suits, class action lawsuits and other matters, that involve claims for
substantial amounts of money or for other relief or that might necessitate changes to our business or operations. For example, as discussed in “Item 3-Legal
Proceedings,” we were recently named, among other defendants, in purported class action lawsuits on behalf of purchasers of shares of our common stock in our
initial public offering and thereafter. The defense of these actions may be both time consuming and expensive. We evaluate these litigation claims and legal
proceedings to assess the likelihood of unfavorable outcomes and to estimate, if possible, the amount of potential losses. Based on these assessments and estimates,
we may establish reserves and/or disclose the relevant litigation claims or legal proceedings, as and when required or appropriate. These assessments and estimates are
based on information available to management at the time of such assessment or estimation and involve a significant amount of judgment. As a result, actual
outcomes or losses could differ materially from those envisioned by our current assessments and estimates. Our failure to successfully defend or settle any of these
litigations or legal proceedings could result in liability that, to the extent not covered by our insurance, could have an adverse effect on our business, financial
condition and results of operations.
Risks related to our ongoing relationship with IAC
IAC controls our company and will have the ability to control the direction of our business.
As of the January 29, 2016, IAC owned all of the shares of our outstanding Class B common stock, representing approximately 84.5% of our outstanding shares
of capital stock and approximately 98.2 % of the combined voting power of our outstanding capital stock. As long as IAC owns shares of our capital stock
representing a majority of the combined voting power of our outstanding capital stock, it will be able to control any corporate action that requires a stockholder vote,
regardless of the vote of any other stockholder. As a result, IAC will have the ability to control significant corporate activities, including:
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the election of our board of directors and, through our board of directors, decision-making with respect to our business direction and policies, including the
appointment and removal of our officers;
acquisitions or dispositions of businesses or assets, mergers or other business combinations;
issuances of shares of our common stock, Class B common stock, Class C common stock and our capital structure;
corporate opportunities that may be suitable for us and IAC, subject to the corporate opportunity provisions in our certificate of incorporation, as described
below;
our financing activities, including the issuance of additional debt and equity securities, or the incurrence of other indebtedness generally; the payment of
dividends; and
the number of shares available for issuance under our equity incentive plans for our prospective and existing employees.
This voting control will limit the ability of other stockholders to influence corporate matters and, as a result, we may take actions that stockholders other than
IAC do not view as beneficial. This voting control may also discourage transactions involving a change of control of our company, including transactions in which
you as a holder of our common stock might otherwise receive a premium for your shares. Furthermore, from and after May 17, 2016, IAC generally has the right at
any time to sell or otherwise dispose of the shares of our capital stock that it owns, including the ability to transfer a controlling interest in us to a third party, without
the approval of the holders of our common stock and without providing for the purchase of shares of common stock.
Even if IAC owns shares of our capital stock representing less than a majority of the combined voting power of our outstanding capital stock, so long as IAC
retains shares representing a significant percentage of our combined voting power, IAC will have the ability to substantially influence these significant corporate
activities.
In addition, pursuant to an investor rights agreement between us and IAC, IAC has the right to maintain its level of ownership in us to the extent we issue
additional shares of our capital stock in the future and, pursuant to an employee matters
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agreement between us and IAC, IAC may receive payment for certain compensation expenses through the receipt of additional shares of our capital stock. For a more
complete summary of our agreements with IAC, see "Item 8- Consolidated and Combined Financial Statements-Note 17."
Until such time as IAC no longer controls or has the ability to substantially influence us, we will continue to face the risks described in this "Risk factors"
section relating to IAC's control of us and the potential conflicts of interest between IAC and us.
Our certificate of incorporation could prevent us from benefiting from corporate opportunities that might otherwise have been available to us.
Our certificate of incorporation has a "corporate opportunity" provision in which we renounce any interests or expectancy in corporate opportunities which
become known to: (i) any of our directors or officers who are also officers, directors, employees or other affiliates of IAC or its affiliates (except that we and our
subsidiaries shall not be deemed affiliates of IAC or its affiliates for the purposes of the provision) or (ii) IAC itself, and which relate to the business of IAC or may
constitute a corporate opportunity for both IAC and us. Generally, neither IAC nor our officers or directors who are also officers or directors of IAC or its affiliates
will be liable to us or our stockholders for breach of any fiduciary duty by reason of the fact that any such person pursues or acquires any corporate opportunity for the
account of IAC or its affiliates, directs or transfers such corporate opportunity to IAC or its affiliates, or does not communicate information regarding such corporate
opportunity to us. The corporate opportunity provision may exacerbate conflicts of interest between IAC and us because the provision effectively permits any of our
directors or officers who also serves as an officer or director of IAC to choose to direct a corporate opportunity to IAC instead of to us.
IAC's interests may conflict with our interests and the interests of our stockholders. Conflicts of interest between IAC and us could be resolved in a manner
unfavorable to us and our public stockholders.
Various conflicts of interest between us and IAC could arise. As of the date of this report, four of our ten directors are current members of the board of directors
or executive officers of IAC. Ownership interests of directors or officers of IAC in our stock and ownership interests of our directors and officers in the stock of IAC,
or a person's service as either a director or officer of both companies, could create or appear to create potential conflicts of interest when those directors and officers
are faced with decisions relating to our company. These decisions could include:
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corporate opportunities;
the impact that operating decisions for our business may have on IAC's consolidated financial statements;
the impact that operating or capital decisions (including the incurrence of indebtedness) for our business may have on IAC's current or future indebtedness or
the covenants under that indebtedness;
business combinations involving us;
our dividend policy;
• management stock ownership; and
•
the intercompany services and agreements between IAC and us.
Potential conflicts of interest could also arise if we decide to enter into any new commercial arrangements with IAC in the future or in connection with IAC's
desire to enter into new commercial arrangements with third parties.
Furthermore, disputes may arise between IAC and us relating to our past and ongoing relationships, and these potential conflicts of interest may make it more
difficult for us to favorably resolve such disputes, including those related to:
•
•
•
•
tax, employee benefit, indemnification and other matters arising from this offering;
the nature, quality and pricing of services IAC agrees to provide to us;
sales or other disposal by IAC of all or a portion of its ownership interest in us; and
business combinations involving us.
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We may not be able to resolve any potential conflicts, and even if we do, the resolution may be less favorable to us than if we were dealing with an unaffiliated
party. While we are controlled by IAC, we may not have the leverage to negotiate amendments to these agreements, if required, on terms as favorable to us as those
we would negotiate with an unaffiliated third party.
Our historical combined financial information may not be representative of the results we would have achieved as a public company and may not be a reliable
indicator of our future results.
The historical combined financial information that we have included in this annual report may not necessarily reflect what our financial position, results of
operations or cash flows would have been had we been a public company during the periods presented or those that we will achieve in the future. Our combined
financial statements reflect the historical financial position, results of operations and cash flows of our various businesses since their respective dates of acquisition by
IAC and the allocation to us by IAC of expenses for certain functions based on various methodologies. We have not adjusted our historical combined financial
information to reflect changes that have occurred (or will occur) in our cost structure, financing and operations as a result of our recent transition to a public company,
including anticipated increased costs associated with public company reporting and other obligations. Accordingly, our historical combined financial information may
not necessarily be indicative of what our financial position, results of operations or cash flows will be in the future.
We are a "controlled company" as defined in the NASDAQ rules, and rely on exemptions from certain corporate governance requirements that provide protection
to stockholders of other companies.
As a result of IAC owning more than 50% of the combined voting power of our share capital, we are a "controlled company" under the Marketplace Rules of the
NASDAQ Stock Market, or the Marketplace Rules. As a "controlled company," certain exemptions under the NASDAQ standards free us from the obligation to
comply with certain Marketplace Rules related to corporate governance, including the requirements:
•
•
that a majority of our board of directors consists of "independent directors," as defined under the Marketplace Rules; and
that we have a nominating/governance committee that is composed entirely of independent directors with a written charter addressing the committee's
purpose and responsibilities.
Accordingly, for so long as we are a "controlled company," our stockholders will not have the same protections afforded to stockholders of companies that are
subject to all of the corporate governance requirements of the Marketplace Rules.
In order to preserve the ability of IAC to distribute its shares of our capital stock on a tax-free basis, we may be prevented from pursuing opportunities to raise
capital, to effectuate acquisitions or to provide equity incentives to our employees, which could hurt our ability to grow.
Under current laws, IAC must retain beneficial ownership of at least 80% of our combined voting power and 80% of each class of our nonvoting capital stock (if
any is outstanding) in order to effect a tax-free distribution of our shares held by IAC to its stockholders. As of the date of this annual report, IAC has advised us that
it does not have any present intention or plans to undertake such a tax-free distribution. However, IAC does currently intend to use its majority voting interest to retain
its ability to engage in such a transaction. This intention may cause IAC to not support transactions we wish to pursue that involve issuing shares of our common
stock, including for capital raising purposes, as consideration for an acquisition or as equity incentives to our employees. The inability to pursue such transactions, if it
occurs, may adversely affect our company. See "—IAC controls our company and will have the ability to control the direction of our business" and "—IAC's interests
may conflict with our interests and the interests of our stockholders. Conflicts of interest between IAC and us could be resolved in a manner unfavorable to us and our
public stockholders."
Our agreements with IAC will require us to indemnify IAC for certain tax liabilities and may limit our ability to engage in desirable strategic or capital raising
transactions, including following any distribution by IAC of our capital stock to its stockholders.
Under a tax sharing agreement between us and IAC, we generally will be responsible and will be required to indemnify IAC for: (i) all taxes imposed with respect
to any consolidated, combined or unitary tax return of IAC or one of its subsidiaries that includes us or any of our subsidiaries to the extent attributable to us or any of
our subsidiaries, as determined under the tax
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sharing agreement, and (ii) all taxes imposed with respect to any consolidated, combined, unitary or separate tax returns of us or any of our subsidiaries. To the extent
IAC failed to pay taxes imposed with respect to any consolidated, combined or unitary tax return of IAC or one of its subsidiaries that includes us or any of our
subsidiaries, the relevant taxing authority could seek to collect such taxes (including taxes for which IAC is responsible under the tax sharing agreement) from us or
our subsidiaries.
Under the tax sharing agreement, we generally will be responsible for any taxes and related amounts imposed on IAC or us that arise from the failure of a future
spin-off of IAC's interest in us to qualify as a transaction that is generally tax-free, for U.S. federal income tax purposes, under Section 368(a)(1)(D) and/or Section
355 of the Internal Revenue Code of 1986, as amended, or the Code, to the extent that the failure to so qualify is attributable to: (i) a breach of the relevant
representations and covenants made by us in the tax sharing agreement or any representation letter provided in support of any tax opinion or ruling obtained by IAC
with respect to the U.S. federal income tax treatment of such spin-off, or (ii) an acquisition of our equity securities.
To preserve the tax-free treatment of any potential future spin-off by IAC of its interest in us, and in addition to our indemnity obligation described above, the tax
sharing agreement will restrict us, for the two-year period following any such spin-off, except in specific circumstances, from: (i) entering into any transaction
pursuant to which all or a portion of shares of our stock would be acquired, whether by merger or otherwise, (ii) issuing equity securities beyond certain thresholds,
(iii) repurchasing our shares other than in certain open-market transactions, (iv) ceasing to actively conduct our businesses or (v) taking or failing to take any other
action that prevents the distribution and related transactions from qualifying as a transaction that is generally tax-free, for U.S. federal income tax purposes, under
Section 368(a)(1)(D) and/or Section 355 of the Code.
These indemnity obligations and other limitations could have an adverse effect on our business, financial condition and results of operations. For a more complete
description of the tax sharing agreement, see "Item 1- Business-Relationship with IAC."
Future sales or distributions of our shares by IAC could depress our common stock price.
From and after May 17, 2016, IAC will have the right to sell or distribute to its stockholders all or a portion of our Class B common stock that it holds. As of the
date of this annual report, IAC has advised us that it does not have any present intention or plans to undertake such a sale or distribution; however, any sales by IAC in
the public market or distributions to its stockholders of substantial amounts of our stock in the form of common stock or Class B common stock, or the filing by IAC
of a registration statement relating to a substantial amount of our stock, could depress the price of our common stock.
In addition, IAC has the right, subject to certain conditions, to require us to file registration statements covering the sale of its shares or to include its shares in
other registration statements that we may file. In the event IAC exercises its registration rights and sells all or a portion of its shares of our capital stock, the price of
our common stock could decline. See "Item 1-Business-Relationship with IAC" and "Item 8- Consolidated and Combined Financial Statements-Note 17."
The services that IAC provides to us may not be sufficient to meet our needs, which may result in increased costs and otherwise adversely affect our business.
IAC currently provides (and is expected to continue to provide) us with significant corporate and shared services related to corporate functions, such as executive
oversight, risk management, information technology, accounting, audit, legal, investor relations, tax, treasury and other services, for a fee provided in the services
agreement described in “Item 1-Business-Relationship with IAC." IAC is not obligated to provide these services in a manner that differs from the nature of the service
when we were a wholly-owned subsidiary of IAC, and thus we may not be able to modify these services in a manner desirable to us as a stand‑alone public company.
Further, if we no longer receive these services from IAC, we may not be able to perform these services ourselves, or find appropriate third‑party arrangements at a
reasonable cost, and the cost may be higher than that charged by IAC.
Risks related to our indebtedness
Our indebtedness may affect our ability to operate our business, which could have a material adverse effect on our financial condition and results of operations.
We and our subsidiaries may incur additional indebtedness, including secured indebtedness.
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As of December 31, 2015, we had total debt outstanding of approximately $1.245 billion ($40 million of which matures in the current year) and borrowing
availability of $500.0 million under the Match Group Credit Facility.
Our indebtedness could have important consequences, such as:
•
•
•
•
•
•
•
limiting our ability to obtain additional financing to fund our working capital needs, acquisitions, capital expenditures or other debt service requirements or
for other purposes;
limiting our ability to use operating cash flow in other areas of our business because we must dedicate a substantial portion of these funds to service debt;
limiting our ability to compete with other companies who are not as highly leveraged, as we may be less capable of responding to adverse economic and
industry conditions;
restricting us from making strategic acquisitions, developing properties or exploiting business opportunities;
restricting the way in which we conduct our business because of financial and operating covenants in the agreements governing our and certain of our
subsidiaries' existing and future indebtedness, including, in the case of certain indebtedness of subsidiaries, certain covenants that restrict the ability of
subsidiaries to pay dividends or make other distributions to us;
exposing us to potential events of default (if not cured or waived) under financial and operating covenants contained in our or our subsidiaries' debt
instruments that could have a material adverse effect on our business, financial condition and operating results; increasing our vulnerability to a downturn in
general economic conditions or in pricing of our products; and
limiting our ability to react to changing market conditions in our industry and in our customers' industries.
In addition to our debt service obligations, our operations require substantial investments on a continuing basis. Our ability to make scheduled debt payments, to
refinance our obligations with respect to our indebtedness and to fund capital and non-capital expenditures necessary to maintain the condition of our operating assets
and properties, as well as to provide capacity for the growth of our business, depends on our financial and operating performance, which, in turn, is subject to
prevailing economic conditions and financial, business, competitive, legal and other factors.
Subject to the restrictions in the Match Group Credit Agreement and the restrictions included in the indenture related to the Match Group Senior Notes, we and
our subsidiaries may incur significant additional indebtedness, including additional secured indebtedness. Although the terms of the Match Group Credit Agreement
and the indenture related to the Match Group Senior Notes contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number
of qualifications and exceptions, and additional indebtedness incurred in compliance with these restrictions could be significant. If new debt is added to our or our
subsidiaries' current debt levels, the risks described above could increase.
We may not be able to generate sufficient cash to service all of our current and planned indebtedness and may be forced to take other actions to satisfy our
obligations under our indebtedness that may not be successful.
Our ability to satisfy our debt obligations will depend upon, among other things:
•
•
our future financial and operating performance, which will be affected by prevailing economic conditions and financial, business, regulatory and other
factors, many of which are beyond our control; and
our future ability to borrow under the Match Group Credit Facility, the availability of which will depend on, among other things, our complying with the
covenants in the then-existing agreements governing our indebtedness.
We cannot assure you that our business will generate sufficient cash flow from operations, or that we will be able to draw under the Match Group Credit Facility
or otherwise, in an amount sufficient to fund our liquidity needs.
If our cash flows and capital resources are insufficient to service our indebtedness, we may be forced to reduce or delay capital expenditures, sell assets, seek
additional capital or restructure or refinance our indebtedness. These alternative measures may not be successful and may not permit us to meet our scheduled debt
service obligations. Our ability to restructure or refinance our debt will depend on the condition of the capital markets and our financial condition at such time. Any
refinancing of our debt could be at higher interest rates and may require us to comply with more onerous covenants, which could further
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restrict our business operations. In addition, the terms of existing or future debt agreements may restrict us from adopting some of these alternatives. In the absence of
such operating results and resources, we could face substantial liquidity problems and might be required to dispose of material assets or operations, sell equity, and/or
negotiate with our lenders to restructure the applicable debt, in order to meet our debt service and other obligations. We may not be able to consummate those
dispositions for fair market value or at all. The Match Group Credit Agreement and the indenture related to the Match Group Senior Notes may restrict, or market or
business conditions may limit, our ability to avail ourselves of some or all of these options.
Furthermore, any proceeds that we could realize from any such dispositions may not be adequate to meet our debt service obligations then due.
Our debt agreements contain restrictions that will limit our flexibility in operating our business.
The Match Group Credit Agreement and the indenture related to the Match Group Senior Notes contain, and any instruments governing future indebtedness of
ours would likely contain, a number of covenants that will impose significant operating and financial restrictions on us, including restrictions on our ability to, among
other things:
•
•
create liens on certain assets;
incur additional debt;
• make certain investments and acquisitions;
•
•
•
•
•
consolidate, merge, sell or otherwise dispose of all or substantially all of our assets;
sell certain assets;
pay dividends on or make distributions in respect of our capital stock or make restricted payments;
enter into certain transactions with our affiliates; and
place restrictions on distributions from subsidiaries.
Any of these restrictions could limit our ability to plan for or react to market conditions and could otherwise restrict corporate activities. Any failure to comply
with these covenants could result in a default under the Match Group Credit Agreement and/or the indenture related to the Match Group Senior Notes or any
instruments governing future indebtedness of ours. Upon a default, unless waived, the lenders under the Match Group Credit Agreement could elect to terminate their
commitments, cease making further loans, foreclose on our assets pledged to such lenders to secure our obligations under the Match Group Credit Agreement and
force us into bankruptcy or liquidation. Holders of the Match Group Senior Notes also have the ability to force us into bankruptcy or liquidation in certain
circumstances, subject to the terms of the related indenture. In addition, a default under the Match Group Credit Agreement or the indenture related to the Match
Group Senior Notes may trigger a cross default under our other agreements and could trigger a cross default under the agreements governing our future indebtedness.
Our operating results may not be sufficient to service our indebtedness or to fund our other expenditures and we may not be able to obtain financing to meet these
requirements.
Variable rate indebtedness that we have incurred or may incur under the Match Group Credit Agreement will subject us to interest rate risk, which could cause
our debt service obligations to increase significantly.
We currently have $800 million of indebtedness outstanding under our Term Loan. Borrowings under the Term Loan are, and any borrowings under the Match
Group Credit Facility will be, at variable rates of interest. Indebtedness that bears interest at variable rates exposes us to interest rate risk The Term Loan currently
bears interest at LIBOR plus 4.50%, with a LIBOR floor of 1.00%. LIBOR, at December 31, 2015, for similar borrowings of three months was approximately 60 basis
points. If LIBOR were to increase by 100 basis points, the annual interest payments on the Term Loan would increase by 60 basis points or $4.8 million in 2016. If
LIBOR decreased annual interest payments on the Term Loan would remain the same because of the 1% floor. Such potential changes in interest payments are based
on the quarterly amortization schedule and certain simplifying assumptions, including a constant rate of variable-rate debt and an immediate across-the-board increase
or decrease in the level of interest rates with no other subsequent changes for the remainder of the period.
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Risks related to ownership of our common stock
The multi-class structure of our capital stock has the effect of concentrating voting control with holders of our Class B common stock and limiting your ability to
influence corporate matters.
Our publicly held common stock has one vote per share and our Class B common stock has ten votes per share. As of January 29, 2016, IAC owned all of the
shares of our outstanding Class B common stock, representing approximately 84.5% of our outstanding shares of capital stock and approximately 98.2% of the
combined voting power of our outstanding capital stock. Due to the ten-to-one voting ratio between our Class B common stock and common stock, the holders of our
Class B common stock collectively will continue to control a majority of the combined voting power of our capital stock, even when the outstanding shares of Class B
common stock represent a small minority of our outstanding capital stock, and such voting control will be concentrated with IAC. This concentrated control will
significantly limit your ability to influence corporate matters.
The difference in the voting rights of our common stock and our Class B common stock may harm the value and liquidity of our common stock.
Holders of our Class B common stock are entitled to ten votes per share and holders of our common stock are entitled to one vote per share. The difference in the
voting rights of our common stock and Class B common stock could harm the value of our common stock to the extent that any investor or potential future purchaser
of our common stock ascribes value to the right of the holders of our Class B common stock to ten votes per share. The existence of two classes of common stock with
different voting rights could result in less liquidity for either class of stock than if there were only one class of our common stock.
The price of our common stock has been and may continue to be volatile or may decline regardless of our operating performance, and you could lose all or part of
your investment.
The initial public offering price of our common stock, which was determined through negotiation between us and the underwriters, was $12.00, and our common
stock has subsequently traded as high as $16.17 and as low as $8.41 during the period from our initial public offering through March 23, 2016. The market price of
our common stock has been and may continue to be subject to wide fluctuations in response to various factors, many of which are beyond our control and may not be
related to our operating performance. These fluctuations could cause you to lose part of your investment in our common stock since you might be unable to sell your
shares at or above the price you paid. Factors that could cause fluctuations in the market price of our common stock include the following:
•price and volume fluctuations in the overall stock market from time to time;
•volatility in the market prices and trading volumes of technology stocks generally, or those in our industry in particular;
•changes in operating performance and stock market valuations of other technology companies generally, or those in our industry in particular;
•sales of shares of our stock by us and/or our directors, executive officers, employees and stockholders;
•the failure of securities analysts to maintain coverage of us, changes in financial estimates by securities analysts who follow our company or our failure to meet
these estimates or the expectations of investors;
•the financial projections we may provide to the public, any changes in those projections or our failure to meet those projections;
•announcements by us or our competitors of new brands, products or services;
•the public's reaction to our earnings releases, other public announcements and filings with the SEC;
•rumors and market speculation involving us or other companies in our industry;
•actual or anticipated changes in our operating results or fluctuations in our operating results;
•actual or anticipated developments in our business, our competitors' businesses or the competitive landscape generally;
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•litigation involving us, our industry or both, or investigations by regulators into our operations or those of our competitors;
•developments or disputes concerning our intellectual property or other proprietary rights;
•announced or completed acquisitions of businesses or technologies by us or our competitors;
•new laws or regulations or new interpretations of existing laws or regulations applicable to our business;
•changes in accounting standards, policies, guidelines, interpretations or principles;
•any significant change in our management; and
•general economic conditions and slow or negative growth in any of our significant markets.
In addition, in the past, following periods of volatility in the overall market and the market price of a particular company's securities, securities class action
litigation has often been instituted against these companies. We currently are, and in the future may be, the target of this type of litigation. See “Item 3-Legal
Proceedings.” Securities litigation against us, could result in substantial costs and a diversion of our management's attention and resources. In addition, in the past,
following periods of volatility in the overall market and the market price of a particular company's securities, securities class action litigation has often been instituted
against these companies. This litigation, if instituted against us, could result in substantial costs and a diversion of our management's attention and resources.
Future sales, or the perception of future sales, of our common stock may depress the price of our common stock.
The market price of our common stock could decline significantly as a result of sales of a large number of shares of our stock in the market, including share
which might be offered for sale by IAC. The perception that these sales might occur could depress the market price of our common stock. These sales, or the
possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at such times and prices as we deem appropriate.
See “-Future sales or distribution of our shares by IAC could depress our common stock price.”
As of January 29, 2016, there were 38,364,777 and 209,919,402 shares of our common stock and Class B common stock, respectively, outstanding. The shares of
common stock are freely tradable without restriction under the Securities Act, except for any shares purchased by our directors, executive officers and other affiliates,
as that term is defined in the Securities Act, which will be restricted securities under the Securities Act.
In connection with the initial public offering of our common stock, we, our directors and executive officer and IAC each entered into a lock-up agreement and are
thereby subject to a lock-up period, meaning that we and they (and our and their permitted transferees) are not permitted to sell any shares of our capital stock for 180
days after the completion of the offering, subject to certain exceptions, without the prior consent of J.P. Morgan Securities LLC and Allen & Company LLC.
Although we are not aware that there is any present intention to do so, the representatives at the underwriters may, in their sole discretion and without notice, release
all or any portion of the shares from the restrictions in any of the lock-up agreements described above. After the expiration of the 180-day restricted period, which is
scheduled to occur on May 17, 2016, all shares subject to lock-up agreements (including 266,500 shares of common stock and 10,010,228 vested Company stock
options held by our directors and named executive officers, collectively, and 209,919,402 shares of Class B common stock held by IAC, in each case, as of the date of
this annual report) may be sold in the public market in the United States, subject to prior registration in the United States, if required, or reliance upon an exemption
from registration, including, in the case of shares held by affiliates or control persons, compliance with the volume restrictions of Rule 144.
Lastly, in the future, we may issue our securities in connection with investments or acquisitions. The amount of shares of our capital stock issued in connection
with an investment or acquisition could constitute a material portion of the then outstanding shares of our common stock.
An active trading market for our common stock may not be sustained.
Our common stock has been trading on the NASDAQ Global Select Market under the symbol "MTCH" since November 19, 2015. We cannot assure you that
the current active trading market for our common stock that has developed on that exchange will be sustained. Accordingly, we cannot assure you of the likelihood
that the current active trading market for our common stock will be maintained, the liquidity of this or any other trading market, the ability to sell shares of our
common stock when desired or at what the prices.
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We do not expect to declare any cash dividends in the foreseeable future.
We do not intend to pay cash dividends on our common stock and Class B common stock for the foreseeable future. Instead, we anticipate that all of our future
earnings will be retained to support our operations and to finance the growth and development of our business. Any future determination relating to our dividend
policy will be made by our board of directors and will depend on a number of factors, including:
•
•
•
•
•
•
•
•
our historic and projected financial condition, liquidity and results of operations;
our capital levels and needs;
tax considerations;
any acquisitions or potential acquisitions that we may consider;
statutory and regulatory prohibitions and other limitations;
the terms of any credit agreements or other borrowing arrangements that restrict our ability to pay cash dividends, including the Match Group Credit
Agreement and the indenture relating to the Match Group Senior Notes;
general economic conditions; and
other factors deemed relevant by our board of directors.
We are not obligated to pay dividends on our common stock or Class B common stock . Consequently, investors may need to rely on sales of their common stock
after price appreciation, which may never occur, as the only way to realize any future gains on their investment. Investors seeking cash dividends should not purchase
our common stock.
Provisions in our certificate of incorporation and bylaws or Delaware law may discourage, delay or prevent a change of control of our company or changes in our
management and, therefore, depress the trading price of our common stock.
Delaware corporate law and our certificate of incorporation and bylaws contain provisions that could discourage, delay or prevent a change in control of our
company or changes in our management that the stockholders of our company may deem advantageous, including provisions which:
•
•
•
•
authorize the issuance of "blank check" preferred stock that our board could issue to increase the number of outstanding shares and to discourage a takeover
attempt;
limit the ability of our stockholders to call special meetings of stockholders;
provide that certain litigation against us can only be brought in Delaware; and
provide that the board of directors is expressly authorized to make, alter or repeal our bylaws.
Any provision of our certificate of incorporation, our bylaws or Delaware law that has the effect of delaying or deterring a change in control could limit the
opportunity for our stockholders to receive a premium for their shares of our common stock, and could also affect the price that some investors are willing to pay for
our common stock.
Item 1B. Unresolved Staff Comments
None.
Item 2. Properties
Match Group's corporate headquarters are located in Dallas, Texas. We do not own any real property.
The facilities for our various businesses, which we lease (in some cases, from IAC) both in the United States and abroad, consist of executive and administrative
offices and data centers. Certain significant properties that we lease, all of which consist of executive and administrative offices, are described in the table
immediately below.
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Location
Dallas, Texas
Paris, France
Business
Match Group/Match
Headquarters
Meetic Headquarters
New York, New York
OkCupid Headquarters
West Hollywood, California
Tinder Headquarters
Ghent, Belgium
Twoo Headquarters
Square Feet
Lease Expiration
50,000
41,000
11,000
14,000
12,000
September 30, 2016 (1)
December 31, 2021
October 31, 2017
December 31, 2016 (2)
December 31, 2018
_______________________________
(1) In October 2015, we entered into a new lease for these operations in Dallas, Texas, pursuant to which we have agreed to lease approximately 73,000 square feet
through March 31, 2027. We will move these operations to this space on or before the expiration of our current lease.
(2) Tinder leases the space for its headquarters in a building owned by IAC pursuant to the services agreement we entered into with IAC in connection with our
initial public offering. The original lease term, which runs through December 31, 2016, will automatically renew unless terminated by either party.
We also lease space in four data centers: two for our North American, Latin American and Asian operations (one in North Dallas, Texas from a third party and
another in Ashburn, Virginia from IAC), and two for our European operations (one in Paris, France and another in Zaventem, Belgium, both from third parties).
We believe that our current facilities are adequate to meet our ongoing needs. We also believe that, if we require additional space, we will be able to lease
additional facilities on commercially reasonable terms.
Item 3. Legal Proceedings
Overview
We are, and from time to time may become, involved in various legal proceedings arising in the normal course of business activities, such as patent infringement
claims, trademark oppositions and consumer or advertising complaints, as well as stockholder derivative actions, class action lawsuits and other matters. The amounts
that may be recovered in such matters may be subject to insurance coverage. Although the results of legal proceedings and claims cannot be predicted with certainty,
we are not currently a party to any legal proceedings the outcome of which, we believe, if determined adversely to us, would individually or in the aggregate have a
material adverse effect on our business, financial condition or results of operations. See "Item 1A-Risk factors—Risks relating to our business—We are subject to
litigation and adverse outcomes in such litigation could have an adverse effect on our financial condition."
Rules of the Securities and Exchange Commission require the description of material pending legal proceedings (other than ordinary, routine litigation incident
to the registrant’s business) and advise that proceedings ordinarily need not be described if they primarily involve damages claims for amounts (exclusive of interest
and costs) not exceeding 10% of the current assets of the registrant and its subsidiaries on a consolidated basis. In the judgment of Match Group management, none of
the pending litigation matters which we are defending, including those described below, involves or is likely to involve amounts of that magnitude. The litigation
matters described below involve issues or claims that may be of particular interest to our stockholders, regardless of whether any of these matters may be material to
our financial position or operations based upon the standard set forth in the SEC’s rules.
Securities Class Action Litigation against Match Group
On February 26, 2016, a putative nationwide class action was filed in federal court in Texas against the Company, five of its officers and directors, and twelve
underwriters of the Company’s initial public offering in November 2015. See David M. Stein v. Match Group, Inc. et al. , No. 3:16-cv-549 (U.S. District Court,
Northern District of Texas). The complaint alleges that the Company’s registration statement and prospectus issued in connection with its initial public offering were
materially false and misleading given their failure to state that: (i) the Company’s Non-dating business would miss its revenue projection for the quarter ended
December 31, 2015, and (ii) ARPPU (as defined in "Item 7-Management's Discussion and Analysis of Financial Condition and Results of Operations- Management
Overview") would decline substantially in the quarter ended December 31, 2015. The complaint asserts that these alleged failures to timely disclose material
information caused the Company’s stock price to drop after the announcement of its earnings for the quarter ended December 31, 2015. The complaint pleads claims
under the Securities Act of 1933 for untrue statements of material fact in, or omissions of material facts from, the registration
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statement, the prospectus, and related communications in violation of Sections 11 and 12 and, as to the officer/director defendants only, control-person liability under
Section 15 for the Company’s alleged violations. The complaint seeks class certification, damages in an unspecified amount and attorneys’ fees. On March 9, 2016, a
virtually identical class action complaint was filed in the same court against the same defendants by a different named plaintiff. See Stephany Kam-Wan Chan v.
Match Group, Inc. et al. , No. 3:16-cv-668 (U.S. District Court, Northern District of Texas). The Company believes that the allegations in these lawsuits are without
merit and will defend vigorously against them.
Item 4. Mine Safety Disclosure
Not applicable.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
PART II
Market for Registrant's Common Equity and Related Stockholder Matters
Our common stock is quoted on the Nasdaq Global Select Market ("NASDAQ") under the ticker symbol "MTCH." Our common stock started trading on
NASDAQ on November 19, 2015. Prior to November 19, 2015, there was no established public trading market for our common stock and there is no established
public trading market for our Class B common stock. The table below sets forth, for the calendar periods indicated, the historical high and low sales prices per share
for our common stock as reported on NASDAQ.
Year Ended December 31, 2015
Fourth Quarter (November 19, 2015 to December 31, 2015)
$
16.17 $
12.63
High
Low
As of March 23, 2016, there were two holders of record of the Company's common stock and the closing price of our common stock on NASDAQ was $10.72.
Because the substantial majority of the outstanding shares of our common stock are held by brokers and other institutions on behalf of shareholders, we are not able to
estimate the total number of beneficial shareholders represented by these record holders. As of March 23, 2016, there was one holder of record of the Company's
Class B common stock.
Dividend Policy
We do not intend to pay dividends on our common stock or Class B common stock for the foreseeable future. Instead, we anticipate that all of our future earnings
will be retained to support our operations and to finance the growth and development of our business. Any future determination relating to our dividend policy will be
made by our board of directors and will depend on a number of factors, including our financial condition, earnings, capital requirements, covenants associated with
our debt obligations, legal requirements, regulatory constraints, general economic conditions and other factors deemed relevant by our board of directors.
Unregistered Sales of Equity Securities
During the past three years, we granted certain of our directors, officers and employees the following options and restricted stock units relating to shares of our
common stock pursuant to equity incentive plans then in effect:
•
•
•
666,779 options with an exercise price of $8.25 during the fiscal year ended December 31, 2013;
10,152,316 options with exercise prices ranging from $11.06 to $13.63 during the fiscal year ended December 31, 2014; and
15,759,976 options with exercise prices ranging from $13.97 to $15.44 and 103,631 restricted stock units between January 1, 2014 and November 18, 2015.
The number of options, exercise price and fair value per share for these awards reflects adjustments made to these awards in connection with our initial public
offering.
On November 18, 2015, we issued 41,666,667 shares of Class B common stock to IAC in respect of its $500.0 million cash contribution to fund our acquisition
of PlentyOfFish, $155.0 million of which was contributed prior to September 30, 2015.
None of the above transactions involved any underwriters or any public offerings and we believe that each of these transactions was exempt from the registration
requirements of the Securities Act pursuant to Section 4(a)(2), Regulation D or Rule 701 of the Securities Act or as transactions not involving the sale of securities.
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Use of Proceeds
On November 18, 2015, the SEC declared the Registration Statement on Form S-1 (SEC File No. 333-207472) related to the initial public offering of our
common stock (the “Form S-1”) effective and we commenced the offering. We registered an aggregate of 38,333,333 shares of our common stock on the Form S-1,
including shares that covered the underwriters’ option to purchase up to 5,000,000 additional shares from us at the initial public offering price during the 30 day
period following the commencement of the offering.
J.P .Morgan Securities LLC, Allen & Company LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated acted as joint book-running managers for the
offering and, in addition, Allen & Company LLC acted as representatives of the underwriters.
On November 24, 2015, we closed the offering and sold 38,333,333 shares of our common stock at a price of $12.00 per share for aggregate gross proceeds of
approximately $460.0 million. Less underwriting discounts and commissions in the aggregate amount of approximately $25.3 million and other fees and expenses
related to the offering in the aggregate of approximately $6.4 million, net proceeds to us from the offering were approximately $428.3 million.
We used all of the net proceeds from the offering to repay related-party indebtedness we issued to IAC on November 18, 2015 in an aggregate amount equal to
the total net proceeds to us from the offering.
Issuer repurchases of equity securities
The Company did not purchase any shares of its common stock during the quarter ended December 31, 2015.
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Item 6. Selected Financial Data
The selected financial data set forth in the table below for 2015, 2014 and 2013 has been derived from our audited consolidated and combined financial
statements as of December 31, 2015 and 2014 and for the years ended December 31, 2015, 2014 and 2013. The combined statement of operations data for the year
ended December 31, 2012 and the combined balance sheet data as of December 31, 2013 have been derived from our audited combined financial statements. This
selected financial data should be read in conjunction with the consolidated and combined financial statements and accompanying notes included herein.
Years Ended December 31,
2015
2014
2013
2012
(Dollars in thousands, except per share data)
Statement of Operations Data: (1)
Revenue
Net earnings
Earnings per share attributable to Match Group, Inc. shareholders:
Basic
Diluted
$
$
$
1,020,431 $
120,487
888,268 $
148,359
803,089 $
126,627
713,449
90,281
0.69 $
0.65 $
0.92 $
0.88 $
0.78 $
0.76 $
0.55
0.53
Balance Sheet Data:
Total assets
Long-term debt, including current maturities
Long-term debt, related party
________________________________________________________________
2015
December 31,
2014 (2)
(In thousands)
2013 (2)
$
1,926,002 $
1,302,109 $
1,286,705
1,233,481
—
—
190,586
—
79,000
(1) We recognized items that affected the comparability of results for the years 2015, 2014 and 2013, see "Item 7—Management's Discussion and Analysis of
Financial Condition and Results of Operations."
(2) Total assets has been adjusted due to the adoption of Financial Accounting Standards Board Accounting Standards Update No. 2015-17, Income Taxes, which
requires that deferred tax assets and liabilities be classified as non-current in the balance sheet, see "Note 2—Summary of Significant Accounting Policies" in
the consolidated and combined financial statements included in "Item 8—Consolidated and Combined Financial Statements and Supplementary Data."
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Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
Key Terms:
When the following terms appear in this report, they have the meanings indicated below:
•
Reportable Segments
•
•
Dating - consists of all of our dating businesses globally.
Non-dating - consists of The Princeton Review.
•
•
•
•
•
•
•
•
Dating North America - consists of the financial results of our Dating businesses for customers located in the United States and Canada.
Dating International - consists of the financial results of our Dating businesses for customers located outside of the United States and Canada.
Direct Revenue - is revenue that is directly received from an end user of our products.
Indirect Revenue - is revenue that is not received directly from an end user of our products, substantially all of which is currently advertising revenue.
Average PMC - is calculated by summing the number of paid members, or paid member count ("PMC") at the end of each day in the relevant measurement
period and dividing it by the number of calendar days in that period. PMC as of any given time represents the number of users with a paid membership at
that time. Users who purchase à la carte features from us do not qualify as paid members for purposes of PMC by virtue of such purchase, though often
such purchasers are also paid members.
Average Revenue Per Paying User ("ARPPU") - is Direct Revenue in the relevant measurement period divided by the Average PMC in such period
divided by the number of calendar days in such period.
Cost of revenue - consists primarily of compensation (including stock-based compensation) and other employee-related costs for personnel engaged in data
center and customer care functions, in-app purchase fees, credit card processing fees, hosting fees, content acquisition costs, and data center rent, energy
and bandwidth costs. In-app purchase fees are monies paid to Apple and Google for the distribution and facilitation of in-app purchase of product features.
Content acquisition cost consists principally of payments made to tutors at The Princeton Review.
Selling and marketing expense - consists primarily of advertising expenditures and compensation (including stock‑based compensation) and other
employee-related costs for personnel engaged in selling and marketing, and sales support functions. Advertising expenditures includes online marketing,
including fees paid to search engines, offline marketing, which is primarily television advertising and partner-related payments to those who direct traffic to
our brands.
• General and administrative expense - consists primarily of compensation (including stock-based compensation) and other employee-related costs for
personnel engaged in executive management, finance, legal, tax and human resources, fees for professional services and facilities costs.
•
Product development expense - consists primarily of compensation (including stock‑based compensation) and other employee-related costs that are not
capitalized for personnel engaged in the design, development, testing and enhancement of product offerings and related technology.
• Match Group Senior Notes - The Company's 6.75% Senior Notes due December 15, 2022, with interest payable each June 15 and December 15; which
were issued on November 16, 2015 in exchange for IAC's 4.75% Senior Notes due December 15, 2022 ("2012 Senior Notes").
•
Term Loan - The Company's $800 million, seven year term loan entered into on November 16, 2015.
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MANAGEMENT OVERVIEW
Match Group, Inc. ("Match Group," the "Company," "we," "our," or "us") is the world’s leading provider of dating products. We operate a portfolio of over 45
dating brands, including Match, OkCupid, PlentyOfFish, Tinder, Meetic, Twoo, OurTime, BlackPeopleMeet and FriendScout24, each designed to increase our users'
likelihood of finding a romantic connection. Through our portfolio of trusted brands, we provide tailored products to meet the varying preferences of our users. We
currently offer our dating products in 38 languages across more than 190 countries. In addition, to our Dating businesses, we also operate The Princeton Review,
which provides a variety of test preparation, academic tutoring and college counseling services.
Sources of Revenue
All our dating products provide the use of certain features for free, and then offer a variety of additional features for paid members. Our Dating revenue is
primarily derived directly from users in the form of recurring membership fees.
Membership revenue is presented net of credits and credit card chargebacks. Members pay in advance, primarily by using a credit card, and, subject to certain
conditions identified in our terms and conditions, all purchases are final and nonrefundable. Fees collected, or contractually due, in advance for memberships are
deferred and recognized as revenue using the straight-line method over the terms of the applicable membership period, which primarily range from one to six months.
We also earn revenue from online advertising, the purchase of à la carte features and offline events. Online advertising revenue is recognized every time an ad is
displayed. Revenue from the purchase of à la carte features is recognized based on usage. Revenue and the related expenses associated with offline events are
recognized when each event occurs.
Non-dating revenue consists primarily of fees received directly from students for in-person and online test preparation classes, access to online test preparation
materials and individual tutoring services. Fees from classes and access to online materials are recognized over the period of the course and the period of the online
access, respectively. Tutoring fees are recognized based on usage.
Trends affecting our Dating business
Over the last several years, we have seen significant changes in our business. During this time, our portfolio has evolved from one dominated by our Match and
affinity brands in North America, and Meetic internationally, to one in which Tinder, OkCupid, PlentyOfFish and Twoo now represent the majority of our overall user
base. This portfolio evolution has led to, been driven by, or coincided with, a number of significant trends in our business including the following:
Meaningful subscriber growth. Over the last several years, we have seen substantial growth in users paying for our products. This growth, however, has come
at a slower pace than our user growth, as the mix of paid and free features at our Tinder, OkCupid, PlentyOfFish and Twoo brands inherently results in conversion of
users to paid members (“conversion”) at lower rates than our other brands. However, because these brands have tended to grow their number of users at a more rapid
pace, they contribute paid members in substantial numbers despite lower conversion rates. Additionally, we expect the percentage of users who are paid members
(which we refer to as penetration) in these brands to increase meaningfully, as penetration tends to increase rapidly during the early years following the introduction of
a Direct Revenue, or paying, model. This is driven by both the introduction of new features that attract different users to convert and by the dynamics of a subscription
business in which members are retained for extended periods and new members are increasingly added. Thus, while we do expect the mix of users to continue to shift
into these lower penetration brands, we expect penetration within these brands to increase meaningfully over the coming years.
Strong mobile adoption. We have recently experienced strong growth in the usage of our products on mobile devices. Mobile adoption leads to higher user
engagement and also opens new customer acquisition channels. As a result, mobile adoption has represented, and continues to represent, a significant growth
opportunity for us. However, it also requires dedication of additional product and technology resources and often requires the payment of additional fees to app stores.
Additionally, our mobile products, taken as a whole, have tended to have lower conversion rates than our desktop products, when we control for other factors
impacting conversion. This has led to challenges over the last few years for those of our brands that had significant pre-existing desktop businesses with high
percentages of paid members. Unlike a mobile only brand like Tinder, where each new mobile user is incremental to the total number of users, for those brands with
significant desktop usage, many new mobile users are users who previously would have been likely to sign up for those products using the desktop. As a result, as the
mobile migration has been rapidly underway, we have seen our overall conversion rates challenged in those businesses. However, we expect to see this trend reverse
itself for two reasons. First, the migration to mobile will either slow rapidly or end as mobile devices obtain a more stable level of penetration within the population.
Second, we expect to be able
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to make significant product improvements to our mobile products over the coming years, driving meaningful conversion increases. Our mobile products are relatively
early in their development stages, as we only began to devote meaningful resources to optimizing these products in the last few years; in contrast, we have focused on
optimizing our desktop products for increased conversion for many years. Therefore, based on our prior experience with product improvement, and the finite nature of
the mobile migration, we believe the conversion challenges we have been facing as a result of the rapid mobile migration in these businesses will level off and then
reverse.
Lower cost users. All of our brands rely on word-of-mouth, or free, customer acquisition to varying degrees. Word-of-mouth acquisition is typically a function
of scale (with larger communities driving greater numbers of referrals), youthfulness (with the viral effect being more pronounced in younger populations due, in part,
to a significantly higher concentration of single people in any given social circle) and monetization rate (with people generally more likely to talk openly about using
dating products that are less heavily monetized). Additionally, some, but not all, of our brands spend meaningfully on paid marketing. Accordingly, the average
amount we spend to acquire a user differs significantly across brands based in large part on each brand’s mix of paid and free acquisition channels. As our mix has
shifted toward younger users, our mix of acquisition channels has shifted toward free channels, driving a significant decline over the past several years in the average
amount we spend to acquire a new user across our portfolio. Our costs of acquiring paid members have also declined meaningfully. We expect the dynamics that have
led to the growth in word-of-mouth customer acquisition to continue going forward and for our brands to continue to acquire significant numbers of users through
low-cost means.
Mix-driven decline in consolidated ARPPU. Tinder, OkCupid, PlentyOfFish and Twoo all have a lower ARPPU, than our other brands. As the number of paid
members from the lower ARPPU brands has become an increasingly large percentage of our aggregate number of paid members, our overall or consolidated ARPPU
has declined. However, within many of our significant brands individually, ARPPU is increasing. Additionally, the decline in ARPPU has coincided with the decline
in the cost of acquiring new users discussed above. Although brand mix shift is reducing consolidated ARPPU, we see continued ability to increase price at many of
our brands.
Changing paid acquisition dynamics. Even as our acquisition of lower cost users increases, paid acquisition of users remains an important driver of our
business. The channels through which we market our brands are always evolving, but we are currently in a period of rapid change as TV and video consumption
patterns evolve and internet consumption shifts from desktop to mobile devices. However, advertising opportunities have not kept up with audience migration, putting
pressure on our paid marketing activities. Recently, we have been able to increase our marketing spend despite these trends, and to bring down the costs of acquiring
new users to our products through our paid channels. However, our increases in spend have generally been made in less effective channels, bringing in lower
converting users. We believe that advertising opportunities will increasingly follow consumer usage patterns, and that as this occurs, and as we improve our expertise
at exploiting these evolving marketing channels, we will be able to increase our marketing efficiency over time.
Other factors affecting the comparability of our results
Advertising spend. Our advertising spend, which is included in our selling and marketing expense, has consistently been our largest operating expense. In recent
periods, we have focused our adverting spend on display, mobile, television and search channels. We seek to optimize for total return on advertising spend by
frequently analyzing and adjusting this spend through numerous campaigns to focus on marketing channels and markets that generate a high return. Our data-driven
approach provides us the flexibility to scale and optimize our advertising spend. We spend marketing dollars against an expected lifetime value of a customer that is
realized by us over a multi-year period; and while this marketing is intended to be profitable on that basis, it is nearly always negative during the period in which the
expense is incurred. Accordingly, our operating results, in particular our profit measures, for a particular period may be meaningfully impacted by the timing, size,
number or effectiveness of our advertising campaigns in that period. Additionally, advertising spend is typically higher during the first quarter of our fiscal year, and
lower during the fourth quarter. See “Seasonality.”
Seasonality. Historically, our Dating business has experienced seasonal fluctuations in quarterly operating results, particularly with respect to our profit
measurements. This is driven primarily by a higher concentration of advertising spend in the first quarter, when advertising prices are lowest and demand for our
products is highest, and a lower concentration of advertising spend in the fourth quarter, when advertising costs are highest and demand for our products is lowest.
International markets. Our products are available in over 190 countries. Our international revenue represented 32% and 35% of our total revenue for the years
ended December 31, 2015 and 2014, respectively. We vary our pricing to align with
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local market conditions and our international businesses typically earn revenue in local currencies, primarily the Euro. As foreign currency exchange rates change,
translation of the statement of operations of our international businesses into U.S. dollars affects year-over-year comparability of operating results.
Business combinations. Acquisitions are an important part of our growth strategy, and we expect to make additional acquisitions in the future. During the three
years ended December 31, 2015, we have invested approximately $661.8 million to acquire 15 new brands for our dating portfolio including Twoo, FriendScout24,
Eureka and PlentyOfFish. As a consequence of the contributions of these businesses and acquisition-related expenses, our consolidated and combined results of
operations may not be comparable between periods.
Non-dating business
In addition to our Dating business, we also operate The Princeton Review, which provides a variety of test preparation, academic tutoring and college
counseling services. We acquired this business because it relies on many of the same competencies as those relied upon by our Dating business, such as paid customer
acquisition, a combination of paid and free business models, a deep understanding of the lifetime values of customers and a strong expertise in user-interface
development. Our strategy in the Non-dating business is to focus on digitizing delivery of our education services and cross-selling multiple products, including
academic tutoring, college counseling services and test preparation services, to our customers. We believe that by doing so, we can improve the economics of this
business and drive earnings growth over time.
Recent Developments
On November 24, 2015, the Company completed its initial public offering ("IPO"). At December 31, 2015, IAC/InterActiveCorp's ("IAC") ownership interest
and voting interest in the Company were 84.6% and 98.2%, respectively.
On November 16, 2015:
•
•
The Company exchanged $445.3 million of IAC's 2012 Senior Notes for $445.2 million of Match Group Senior Notes.
The Company amended and restated its credit agreement to provide for an $800 million Term Loan.
On October 28, 2015, the Company completed the purchase of Plentyoffish Media Inc., ("PlentyOfFish"), for $575 million in cash.
On October 7, 2015, the Company entered into a credit agreement, which provides for a $500 million revolving credit facility that expires on October 7, 2020.
2015 Consolidated Results
In 2015, we delivered 15% revenue growth and 2% Adjusted EBITDA growth; however, operating income declined 15%. Revenue growth was primarily driven
by an increase in Direct revenue and the full year contribution from The Princeton Review. Foreign exchange effects negatively impacted Dating revenue by 6%.
Adjusted EBITDA increased 2% , slower than the 15% increase in revenue due to $16.8 million of costs in the current year related to our ongoing consolidation and
streamlining of technology systems and European operations at the Dating businesses. The operating income decline was due primarily to an increase in stock-based
compensation.
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Results of Operations for the years ended December 31, 2015, 2014 and 2013
Revenue
Years Ended December 31,
2015
Change
% Change
2014
Change
% Change
2013
(Dollars in thousands, except ARPPU)
Direct Revenue:
North America
$
583,232
$
International
Total Direct Revenue
Indirect Revenue
Total Dating Revenue
Non-dating Revenue
283,351
866,583
43,122
909,705
110,726
57,304
9,752
67,056
6,191
73,247
58,916
10.9 % $
525,928
$
3.6 %
8.4 %
16.8 %
8.8 %
113.7 %
273,599
799,527
36,931
836,458
51,810
Total Revenue
$
1,020,431
$
132,163
14.9 % $
888,268
$
32,199
13,259
45,458
2,803
48,261
36,918
85,179
6.5 % $
5.1 %
6.0 %
8.2 %
6.1 %
247.9 %
10.6 % $
493,729
260,340
754,069
34,128
788,197
14,892
803,089
Percentage of Total Revenue:
Direct Revenue:
North America
International
Total Direct Revenue
Indirect Revenue
Total Dating Revenue
Non-dating Revenue
Total Revenue
Average PMC:
North America
International
Total
ARPPU:
North America
International
Total
57.2%
27.8%
85.0%
4.2%
89.2%
10.8%
100.0%
2,712
1,435
4,147
$
$
$
0.59
0.54
0.57
$
$
$
59.2%
30.8%
90.0%
4.2%
94.2%
5.8%
100.0%
308
338
646
(0.01)
(0.14)
(0.06)
12.8 %
30.8 %
18.5 %
2,404
1,097
3,501
(1.7)% $
(20.8)% $
(8.5)% $
0.60
0.68
0.63
$
$
$
235
77
312
(0.02)
(0.02)
(0.02)
10.8 %
7.5 %
9.8 %
(3.9)% $
(2.3)% $
(3.4)% $
61.5%
32.4%
93.9%
4.2%
98.1%
1.9%
100.0%
2,169
1,020
3,189
0.62
0.70
0.65
For the year ended December 31, 2015 compared to the year ended December 31, 2014
Revenue increased $132.2 million or 14.9% in 2015 versus 2014, or 20.3% excluding the effects of foreign exchange.
North America Direct Revenue grew $57.3 million , or 10.9% , in 2015 versus 2014, driven by 12.8% growth in Average PMC, partially offset by a 1.7%
decline in ARPPU. Average PMC growth was driven by an increase in the percentage of new users becoming paid members, growth in new users and higher
beginning PMC. ARPPU decreased due to mix shifts to lower rate brands, partially offset by an increase in mix-adjusted rates.
International Direct Revenue grew $9.8 million , or 3.6% , in 2015 versus 2014, primarily driven by 30.8% growth in Average PMC, partially offset by a 20.8%
decline in ARPPU. Average PMC growth was driven by an increase in the percentage of new users becoming paid members, growth in new users, and higher
beginning PMC. The majority of the decline in ARPPU was due to the effects of foreign exchange. Adjusting for foreign exchange effects, International Direct
Revenue grew 20.8%, and International ARPPU declined 7.6% as a result of a mix shift to lower rate brands, partially offset by increases in mix adjusted rates.
Non-dating revenue increased $58.9 million , or 113.7% , as a result of the full year contribution from The Princeton Review, which was acquired in August
2014.
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For the year ended December 31, 2014 compared to the year ended December 31, 2013
Revenue increased $85.2 million , or 10.6% , in 2014 versus 2013.
North America Direct Revenue increased $32.2 million , or 6.5% , in 2014 versus 2013, driven by 10.8% growth in Average PMC, partially offset by a 3.9%
decline in ARPPU. Average PMC growth was driven by a strong increase in beginning PMC and strong new user growth, partially offset by mix shift to brands where
a lower percentage of new users become paid members. ARPPU decreased due to mix shifts to lower rate brands as well as a decline in mix-adjusted rates.
International Direct Revenue increased $13.3 million , or 5.1% , in 2014 versus 2013, driven by 7.5% growth in Average PMC, partially offset by a 2.3%
decline in ARPPU. Average PMC growth was driven by a strong increase in beginning PMC, the acquisition of FriendScout24 and growth in new users, partially
offset by mix shift to brands where a lower percentage of new users became paid members. ARPPU decreased due to mix shift to lower rate brands, partially offset by
mix-adjusted rate increases.
Non-dating revenue grew $36.9 million , or 247.9% , as a result of our acquisition of The Princeton Review in August 2014.
Cost of revenue (exclusive of depreciation)
2015
$ Change
% Change
2014
$ Change
% Change
2013
Cost of revenue
Percentage of revenue
$177,988
17.4%
$57,964
48.3%
(Dollars in thousands)
$120,024
13.5%
$34,079
39.7%
$85,945
10.7%
Years Ended December 31,
For the year ended December 31, 2015 compared to the year ended December 31, 2014
Cost of revenue increased $58.0 million , or 48.3% , in 2015 versus 2014.
Dating cost of revenue increased $39.6 million, or 41.8%, meaningfully more than the growth in revenue, driven primarily by a significant increase in in-app
purchase fees across multiple brands, including Tinder, which started to monetize in earnest in 2015, as well as higher hosting fees driven by growth in users and
product features.
Non-dating cost of revenue increased $18.4 million, or 72.8%, driven by the acquisition of The Princeton Review, for which cost of revenue represents a
meaningfully larger percentage of revenue than in Dating.
For the year ended December 31, 2014 compared to the year ended December 31, 2013
Cost of revenue increased $34.1 million , or 39.7% , in 2014 versus 2013.
Dating cost of revenue increased $16.0 million, or 20.4%, meaningfully more than the growth in revenue driven primarily by a significant increase in in-app
purchases given that our native mobile apps were largely introduced in the second quarter of 2014, as well as higher hosting fees driven by growth in users and
product features.
Non-dating cost of revenue increased $18.0 million, or 250.6%, driven by the acquisition of The Princeton Review, for which cost of revenue represents a
meaningfully larger percentage of revenue than in Dating.
Selling and marketing expense
2015
$ Change
% Change
2014
$ Change
% Change
2013
Years Ended December 31,
Selling and marketing expense
Percentage of revenue
$359,598
35.2%
$24,491
7.3%
(Dollars in thousands)
$335,107
37.7%
$13,237
4.1%
$321,870
40.1%
For the year ended December 31, 2015 compared to the year ended December 31, 2014
Selling and marketing expense increased $24.5 million , or 7.3% , in 2015 versus 2014.
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Dating selling and marketing expense increased $18.1 million, or 5.6%, driven primarily by the acquisitions of FriendScout24 in 2014 and Eureka in 2015, and
an increase in stock-based compensation expense, partially offset by declines in advertising spend as a percentage of revenue.
Non-dating selling and marketing expense increased $6.4 million, or 61.6%, primarily driven by the acquisition of The Princeton Review. Selling and marketing
expense at Non-dating generally represents a smaller percentage of revenue than in Dating.
For the year ended December 31, 2014 compared to the year ended December 31, 2013
Selling and marketing expense increased $13.2 million , or 4.1% , in 2014 versus 2013.
Dating selling and marketing expense increased $8.3 million, or 2.6%, driven by an increase of $5.4 million from the acquisition of FriendScout24 and an
increase in advertising spend.
Non-dating selling and marketing expense increased $5.0 million, or 91.7%, driven primarily by $4.5 million from the acquisition of The Princeton Review.
General and administrative expense
2015
$ Change
% Change
2014
$ Change
% Change
2013
Years Ended December 31,
General and administrative expense
Percentage of revenue
$175,857
17.2%
$57,967
49.2%
$117,890
$24,249
25.9%
(Dollars in thousands)
13.3%
$93,641
11.7%
For the year ended December 31, 2015 compared to the year ended December 31, 2014
General and administrative expense increased $58.0 million , or 49.2% , in 2015 versus 2014.
Dating general and administrative expense increased $33.9 million, or 38.3%, driven primarily by an increase of $19.6 million in stock-based compensation
expense due to the modification of certain equity awards and new grants, as well as an increase of $3.3 million in severance expense and costs during the current year
related to on-going consolidation and streamlining of technology systems and European operations. Additionally, 2014 was impacted by a $3.9 million benefit related
to the expiration of the statute of limitations for a non-income tax matter.
Non-dating general and administrative expense increased $24.1 million, or 81.7%, driven by the acquisition of The Princeton Review.
For the year ended December 31, 2014 compared to the year ended December 31, 2013
General and administrative expense increased $24.2 million , or 25.9% , in 2014 versus 2013.
Dating general and administrative expense increased $1.7 million, or 2.0%, primarily driven by an increase in compensation of $10.7 million at our existing
businesses, primarily due to an increase of $8.5 million in stock-based compensation expense due to new grants and increased headcount. These increases were
partially offset by a decrease of $13.3 million for an acquisition-related contingent consideration fair value adjustment at Twoo driven by changes in the forecast of
earnings and operating metrics, and a $3.9 million benefit recorded in the first quarter of 2014 related to the expiration of the statute of limitations for a non-income
tax matter.
Non-dating general and administrative expense increased $22.5 million, or 327.2%, driven primarily by $21.2 million from the acquisition of The Princeton
Review.
36
Table of Contents
Product development expense
2015
$ Change
% Change
2014
$ Change
% Change
2013
Years Ended December 31,
Product development expense
Percentage of revenue
$67,348
6.6%
$17,610
35.4%
(Dollars in thousands)
$49,738
5.6%
$6,765
15.7%
$42,973
5.4%
For the year ended December 31, 2015 compared to the year ended December 31, 2014
Product development expense increased $17.6 million or 35.4% , in 2015 versus 2014, driven primarily by increased salaries and wages from existing
businesses and from acquisitions at Dating, $4.0 million in severance expense and costs in the current year, primarily in the first half of 2015, related to our ongoing
consolidation and streamlining of technology systems and European operations at Dating and an increase of $3.3 million in stock-based compensation expense due to
the modification of certain equity awards and new grants.
For the year ended December 31, 2014 compared to the year ended December 31, 2013
Product development expense increased $6.8 million , or 15.7% , in 2014 versus 2013, primarily driven by an increase in compensation driven by increased
headcount at Tinder and Tutor.com (now The Princeton Review).
Depreciation
2015
$ Change
% Change
2014
$ Change
% Change
2013
Years Ended December 31,
Depreciation
Percentage of revenue
$25,983
2.5%
$436
1.7%
(Dollars in thousands)
$25,547
2.9%
$5,345
26.5%
$20,202
2.5%
For the year ended December 31, 2015 compared to the year ended December 31, 2014
Depreciation increased $0.4 million , or 1.7% , in 2015 versus 2014, driven by the acquisition of The Princeton Review, partially offset by a decline in
depreciation at Dating.
For the year ended December 31, 2014 compared to the year ended December 31, 2013
Depreciation increased by $5.3 million , or 26.5% , in 2014 versus 2013, primarily driven by $3.8 million from the acquisition of The Princeton Review and the
incremental depreciation associated with capital expenditures.
Adjusted EBITDA
Refer to Note 13 to our consolidated and combined financial statements for reconciliations of Adjusted EBITDA to operating income and net earnings
attributable to Match Group, Inc. shareholders.
2015
$ Change
% Change
2014
$ Change
% Change
2013
Adjusted EBITDA
Percentage of revenue
$278,667
27.3%
$5,219
1.9%
(Dollars in thousands)
$273,448
30.8%
$2,217
0.8%
$271,231
33.8%
Years Ended December 31,
For the year ended December 31, 2015 compared to the year ended December 31, 2014
Adjusted EBITDA increased $5.2 million or 1.9% , in 2015 versus 2014.
Dating Adjusted EBITDA decreased $4.7 million, or 1.6%, despite higher revenue, primarily due to $16.8 million of costs in the current year across our expense
categories related to our ongoing consolidation and streamlining of technology systems and European operations, an increase in cost of revenue and a $3.9 million
benefit in the prior year related to the expiration of the statute of limitations for a non-income tax matter.
37
Table of Contents
Non-dating Adjusted EBITDA loss declined $10.0 million, or 62.8%, primarily due to reduced losses from The Princeton Review.
For the year ended December 31, 2014 compared to the year ended December 31, 2013
Adjusted EBITDA increased $2.2 million or 0.8% , in 2014 versus 2013.
Dating Adjusted EBITDA increased $11.8 million or 4.3%, due primarily to the increase in revenue of 6.1%, partially offset by the increase in cost of revenue,
which grew at a meaningfully faster rate than revenue due to the factors described above.
Non-dating Adjusted EBITDA loss increased $9.6 million, or 154.2%, due primarily to losses from the acquisition of The Princeton Review.
Operating income
2015
$ Change
% Change
2014
$ Change
% Change
2013
Operating income
Percentage of revenue
$193,556
19.0%
$(35,011)
(15.3)%
(Dollars in thousands)
$228,567
25.7%
$7,234
3.3%
$221,333
27.6%
Years Ended December 31,
For the year ended December 31, 2015 compared to the year ended December 31, 2014
Operating income decreased $35.0 million , or 15.3% , in 2015 versus 2014.
Dating operating income decreased $40.7 million, or 16.1%, primarily due to the decrease of $4.7 million in Adjusted EBITDA described above and an increase
of $29.9 million in stock-based compensation expense, which is due to the modification of certain equity awards, the periodic re-assessment of certain performance-
based restricted stock units and new grants; and an increase of $6.0 million in amortization of intangibles related to acquisitions occurring in 2015.
Non-dating operating loss decreased $5.7 million, or 22.8%, as a result of the reduced Adjusted EBITDA losses described above, offset by increases of $2.1
million in depreciation expense and $2.7 million in amortization expense, which are primarily due to the acquisition of The Princeton Review.
At December 31, 2015, there was $95.9 million of unrecognized compensation cost, net of estimated forfeitures, related to all equity-based awards, which is
expected to be recognized over a weighted average period of approximately 2.8 years.
For the year ended December 31, 2014 compared to the year ended December 31, 2013
Operating income increased $7.2 million , or 3.3% , in 2014 versus 2013.
Dating operating income increased $23.5 million, or 10.2%, primarily due to the increase of $11.8 million in Adjusted EBITDA described above and decreases
of $13.3 million in acquisition-related contingent consideration fair value adjustments and $7.7 million in amortization of intangibles, partially offset by an increase of
$7.8 million in stock-based compensation expense. The change in acquisition-related contingent consideration fair value adjustments was related to changes in
Twoo’s forecast of earnings and operating metrics. The decrease in amortization of intangibles was due to certain intangible assets becoming fully amortized. The
increase in stock-based compensation expense was primarily due to new grants.
Non-dating operating loss increased $16.2 million, or 181.4%, primarily due to the increase in Adjusted EBITDA loss of $9.6 million described above as well as
increases of $3.8 million in depreciation expense and $2.0 million in amortization of intangibles due primarily to the acquisition of The Princeton Review.
38
Table of Contents
Interest expense
Interest expense—third party
Interest expense—related party
________________________
NA = not applicable
Years Ended December 31,
2015
$ Change
% Change
2014
$ Change
% Change
$(18,049)
(8,009)
$(18,049)
$17,532
NA
(68.6)%
(Dollars in thousands)
$—
(25,541)
$—
$8,766
NA
(25.6)%
2013
$—
(34,307)
For the year ended December 31, 2015 compared to the year ended December 31, 2014
Interest expense—third party relates to interest on the $800 million Term Loan and Match Group Senior Notes and the commitment fee on the Company's
revolving credit facility, all of which commenced in the fourth quarter of 2015. Included in third party interest expense is $7.3 million of debt issuance costs related to
the Match Group Senior Notes.
Interest expense—related party includes interest charged by IAC and its subsidiaries on long-term debt, related party, as well as on other acquisitions-related
loans, a portion of which was capitalized on June 30, 2014. The long-term debt, related party was settled during the fourth quarter of 2015.
Other income, net
Other income, net
________________________
NM = not meaningful
2015
$ Change
% Change
2014
$ Change
% Change
$11,887
$(723)
(5.7)%
(Dollars in thousands)
$12,610
$12,393
NM
2013
$217
Years Ended December 31,
For the year ended December 31, 2015 compared to the year ended December 31, 2014
Other income, net includes $7.6 million and $8.3 million in 2015 and 2014, respectively, in foreign currency exchange gains related to our €53 million 5.00%
Note payable to an IAC subsidiary. This note was settled during the fourth quarter of 2015 prior to Company's IPO.
For the year ended December 31, 2014 compared to the year ended December 31, 2013
Other income, net in 2014 includes $8.3 million in foreign currency exchange gains related to our €53 million 5.00% Note payable issued on April 8, 2014 to an
IAC subsidiary.
Income tax provision
2015
$ Change
% Change
2014
$ Change
% Change
2013
Years Ended December 31,
Income tax provision
Effective income tax rate
$(58,898)
32.8%
NM
NM
(Dollars in thousands)
$(67,277)
31.2%
NM
NM
$(60,616)
32.4%
For discussion of income taxes, see Note 3—Income Taxes to the consolidated and combined financial statements.
For the years ended December 31, 2015, 2014 and 2013, the Company recorded income tax provisions of $58.9 million , $67.3 million , and $60.6 million ,
respectively, which represent effective income tax rates of 32.8% , 31.2% and 32.4% , respectively. In 2015 and 2014, the effective income tax rates were lower than
the statutory rate of 35% due primarily to non-taxable contingent consideration fair value adjustments and non-taxable foreign currency exchange gains, partially
offset by state taxes. In 2013, the effective income tax rate was lower than the statutory rate of 35% due primarily to the settlement of uncertain tax positions.
39
FINANCIAL POSITION, LIQUIDITY AND CAPITAL RESOURCES
Financial Position
Cash and cash equivalents:
United States (1)
All other countries (2)
Marketable equity security (United States)
Total cash and cash equivalents and marketable securities
Long-term debt:
Term Loan, final payment due November 16, 2022 (3)
Match Group Senior Notes due December 15, 2022
3.57% Notes—related party (3)
5.00% Note — related party (3)
5.90% Note — related party (3)
Less: Current portion of long-term debt
Less: Net adjustment for remaining original issue discount on Term Loan and original issue
premium related to the Match Exchange Offer
Total long-term debt, net of current maturities
December 31, 2015
December 31, 2014
(In thousands)
34,422 $
53,751
11,622
99,795 $
800,000 $
445,172
—
—
—
1,245,172
40,000
11,691
1,193,481 $
4,890
122,740
—
127,630
—
—
79,000
64,586
47,000
190,586
—
—
190,586
$
$
$
$
(1) Domestically, the entire balance reflects cash deposits held in financial institutions. Prior to the IPO, the Company participated in IAC’s centrally managed
U.S. treasury management function in which IAC swept our domestic cash.
(2) Internationally, there is $3.6 million of cash equivalents, at December 31, 2015, which consist of money market funds; the balance reflects cash deposits
held in financial institutions. If needed for our U.S. operations, most of the cash and cash equivalents held by the Company's foreign subsidiaries could be
repatriated, which, under current tax law, would be subject to U.S. federal and state income taxes. We currently do not anticipate a need to repatriate these
funds to finance our U.S. operations and it is our intent to indefinitely reinvest these funds outside of the U.S.; therefore, we have not provided for any U.S.
income taxes related to these funds.
(3) The net proceeds received from the Term Loan were used, in part, to pay off the related party long-term debt and the remainder was distributed to IAC.
Principal payments of $10 million under the Term Loan are due quarterly through maturity, at which point a final principal payment of $530 million will
become due.
Cash Flow Information
In summary, the Company's cash flows are as follows:
Net cash provided by operating activities
Net cash used in investing activities
Net cash provided by (used in) financing activities
2015
Years ended December 31,
2015
2014
2013
$
209,082 $
173,615 $
(In thousands)
(648,862)
408,219
(140,200)
(20,058)
174,797
(53,986)
(105,262)
Net cash provided by operating activities consists of earnings adjusted for non-cash items, including stock-based compensation expense, depreciation,
amortization of intangibles, deferred income taxes, acquisition-related contingent
40
consideration fair value adjustments, and the effect of changes in working capital activities. Adjustments for non-cash items primarily consist of $50.1 million of
stock-based compensation expense, $26.0 million of depreciation and $20.1 million of amortization of intangibles, partially offset by deferred income taxes of $22.5
million and $11.1 million of acquisition-related contingent consideration fair value adjustments. The increase in changes in working capital consists primarily of an
increase in deferred revenue of $37.8 million and an increase in accounts payable and accrued expenses and other current liabilities of $31.7 million , partially offset
by an increase in accounts receivable of $29.3 million and an increase in other assets of $11.3 million . The increase in deferred revenue is primarily due to growth in
membership fees in the Dating business and acquisitions. The increase in accounts payable and accrued expenses and other current liabilities is primarily due to
increased advertising spending, the timing of advertising payments, and an increase in accrued interest related to the Company's Term Loan and Match Group Senior
Notes. The increase in accounts receivable is primarily due to growth in in-app purchases sold through Dating’s mobile products. The increase in other assets was
primarily due to an increase in prepaid expenses, mainly from growth and the signing of longer-term contracts.
Net cash used in investing activities in 2015 includes acquisitions of $611.3 million , which includes $575.0 million for PlentyOfFish, and capital expenditures
of $29.2 million , primarily related to the internal development of software to support our products and services, and computer hardware.
Net cash provided by financing activities in 2015 includes $788.0 million in borrowings under the Term Loan, $428.8 million in net proceeds received from the
IPO, $500.0 million in capital contribution from IAC to partially fund the acquisition of PlentyOfFish and excess tax benefits from stock-based awards of $38.4
million , partially offset by a cash dividend to IAC of $1.0 billion , the repayment of $182.5 million in related party debt, net cash transfers of $86.0 million to IAC
related to its centrally managed U.S. treasury management function, $23.4 million for the repurchase of stock-based awards, $17.2 million in debt issuance costs
related to our Term Loan and revolving credit facility and $7.0 million of debt issuance costs related to the Match Group Senior Notes.
2014
Adjustments for non-cash items primarily consist of $25.5 million of depreciation, $20.9 million of stock-based compensation expense and $11.4 million of
amortization of intangibles, partially offset by $12.9 million in acquisition-related contingent consideration fair value adjustments, $9.0 million in other adjustments,
net, principally related to an $8.3 million foreign currency gain on the €53 million note and $5.9 million of deferred income taxes. The changes from working capital
activities primarily consist of an increase in other assets of $10.6 million and a decrease of $8.0 million in accounts payable and accrued expenses and other current
liabilities, partially offset by an increase in deferred revenue of $8.6 million. The increase in other assets is due to an increase in prepaid marketing at Dating and an
increase in prepaid hosting fees in connection with the growth in users and product features. The decrease in accounts payable and accrued expenses and other current
liabilities is due to the timing of payments. The increase in deferred revenue is primarily due to the acquisition of The Princeton Review and growth in Dating
membership revenue.
Net cash used in investing activities in 2014 includes acquisitions of $114.1 million, which includes The Princeton Review, and capital expenditures of
$21.8 million, primarily related to the internal development of software to support our products and services.
Net cash used in financing activities in 2014 includes cash transfers of $108.7 million to IAC, $33.2 million for the purchase of noncontrolling interests in
Tinder and Meetic and a $7.4 million contingent consideration payment related to the 2013 Twoo acquisition, partially offset by $111.6 million in proceeds from the
issuance of related party debt, the return of $12.4 million of funds held in escrow related to the Meetic tender offer and $5.3 million in excess tax benefits from stock-
based awards.
2013
Adjustments for non-cash items primarily consist of $20.2 million of depreciation, $17.1 million of amortization of intangibles and $12.2 million of stock-based
compensation expense. The changes from working capital activities primarily consist of an increase in deferred revenue of $12.4 million, partially offset by an
increase in accounts receivable of $3.7 million. The increase in deferred revenue is primarily due to the growth in membership revenue. The increase in accounts
receivable is primarily due to growth in indirect revenue at Dating.
Net cash used in investing activities in 2013 includes acquisitions of $32.1 million, which includes Twoo, and capital expenditures of $19.8 million primarily
related to the internal development of software to support our products and services.
41
Net cash used in financing activities in 2013 includes $71.5 million held in escrow related to the Meetic tender offer and $52.6 million for the purchase of
noncontrolling interests in Meetic, partially offset by $10.8 million in excess tax benefits from stock-based awards and cash transfers of $9.7 million from IAC.
Liquidity and Capital Resources
The Company's principal sources of liquidity are its cash flows generated from operations as well as cash and cash equivalents and marketable securities. On
October 7, 2015, the Company entered into a credit agreement (the "Match Group Credit Agreement"), which provides for a five-year $500 million revolving credit
facility (the "Match Group Credit Facility"). At December 31, 2015, there were no outstanding borrowings under the Match Group Credit Facility. Borrowings under
the Match Group Credit Facility bear interest, at the Company's option, at a base rate or LIBOR, in each case plus an applicable margin, which is determined by
reference to a pricing grid based on the Company's consolidated net leverage ratio.
On November 16, 2015, the Company completed a private exchange offer to eligible holders to exchange any and all of IAC's 2012 Senior Notes for up to
$500 million aggregate principal amount of Match Group Senior Notes issued by the Company (the "Match Exchange Offer"). The Company exchanged
$445.3 million of IAC's 2012 Senior Notes for $445.2 million of Match Group Senior Notes pursuant to the Match Exchange Offer. Prior to the IPO, the Company
and certain of its domestic subsidiaries were guarantors of IAC’s 4.875% Senior Notes due November 30, 2018 (the "2013 Senior Notes"), IAC's 2012 Senior Notes
and IAC's $300 million revolving credit facility (the "IAC Credit Facility"). Promptly following the closing of the Match Exchange Offer, the Company and its
subsidiaries were designated as unrestricted subsidiaries of IAC for purposes of the indentures governing IAC's 2013 and 2012 Senior Notes and the IAC Credit
Facility. Following the designation, neither the Company nor any of its subsidiaries guaranteed any debt of IAC, or are subject to any of the covenants related to such
debt.
The indenture governing the Match Group Senior Notes restricts the Company's ability to incur additional indebtedness in the event it is not in compliance with
the maximum leverage ratio of 5.0 to 1.0. At December 31, 2015, there were no limitations pursuant thereto. There are additional covenants that limit the ability of the
Company and its subsidiaries to, among other things, (i) incur indebtedness, make investments, or sell assets in the event the Company is not in compliance with the
financial ratio set forth in the indenture, and (ii) incur liens, enter into agreements restricting the ability of the Company's subsidiaries to pay dividends, enter into
transactions with affiliates and consolidate, merge or sell substantially all of their assets.
On November 16, 2015, the Company amended and restated the Match Group Credit Agreement to provide for an $800 million, seven-year term loan. Principal
payments of $10 million under the Term Loan are due quarterly through maturity, at which point a final principal payment of $530 million will become due.
Additionally, the Term Loan may require additional annual principal payments as part of an excess cash flow sweep provision, the amount of which is governed by
the net secured leverage ratio. The Term Loan bears interest, at our option, at the base rate or LIBOR, plus 3.50% or 4.50%, respectively, with, in the case of LIBOR,
a floor of 1.00%. Interest payments are due no less than semi-annually through the term of the loan. The Term Loan and outstanding borrowings, if any, under the
Match Group Credit Facility rank pari-passu with each other, and have priority over the Match Group Senior Notes.
The terms of the Match Group Credit Facility require the Company to maintain a leverage ratio of not more than 5.00 to 1.00 and a minimum interest coverage
ratio of not less than 2.50 to 1.00. As of December 31, 2015, the Company was in compliance with all applicable covenants. There are additional covenants under the
Match Group Credit Facility and the Match Group Term Loan that limit the ability of the Company and its subsidiaries to, among other things, incur indebtedness,
pay dividends or make distributions. While the Term Loan remains outstanding, these same covenants under the Match Group Credit Agreement are more restrictive
than the covenants that are applicable to the Match Group Credit Facility. Obligations under the Match Group Credit Facility and Term Loan are unconditionally
guaranteed by certain Match Group wholly-owned domestic subsidiaries, and are also secured by the stock of certain Match Group domestic and foreign subsidiaries.
Prior to the IPO, the Company entered into an uncommitted subordinated loan facility with IAC (the "IAC Subordinated Loan Facility"), which allows the
Company to make one or more requests to IAC to borrow funds from it. If IAC agrees to fulfill any such borrowing request from the Company, such borrowing will
be incurred in accordance with the terms of the IAC Subordinated Loan Facility. Any indebtedness outstanding under the IAC Subordinated Loan Facility will be by
its terms subordinated in right of payment to the obligations under the Match Group Credit Facility, the Match Group Term Loan and the Match Group Senior Notes.
The IAC Subordinated Loan Facility has a scheduled final maturity date of no earlier than 90 days after the maturity date of the Match Group Credit Facility or the
latest maturity date in respect of any class of Term Loans outstanding under the Match Group Credit Agreement. At December 31, 2015, the Company has no
indebtedness outstanding under the IAC Subordinated Loan Facility.
42
The Company anticipates that it will need to make capital and other expenditures in connection with the development and expansion of its operations. The
Company expects that 2016 capital expenditures will be higher than 2015 by approximately 10% to 20%, driven primarily by leasehold improvements related to a
new lease for the Company's corporate headquarters.
The Company believes its expected positive cash flows generated from operations together with its existing cash, cash equivalents and marketable securities and
available borrowing capacity under the Match Group Credit Facility will be sufficient to fund its normal operating requirements, including capital expenditures, debt
service, withholding taxes related to net-settled stock-based awards, and investing and other commitments for the foreseeable future. The Company's liquidity could
be negatively affected by a decrease in demand for our products and services. Our indebtedness could limit our ability to: (i) obtain additional financing to fund
working capital needs, acquisitions, capital expenditures or debt service or other requirements; and (ii) use operating cash flow to make acquisitions, capital
expenditures, invest in other areas, such as developing properties and exploiting business opportunities. IAC owns all of the shares of our outstanding Class B
common stock, representing approximately 84.6% of our outstanding shares of capital stock and approximately 98.2% of the combined voting power of our
outstanding capital stock. As a result of IAC's ability to control the election and removal of our board of directors, IAC effectively has the ability to control our
financing activities, including the issuance of additional debt and equity securities, or the incurrence of other indebtedness. While the Company believes we will have
the ability to access debt and equity markets if needed, such transactions may require the concurrence of IAC.
43
CONTRACTUAL OBLIGATIONS AND COMMERCIAL COMMITMENTS
Contractual Obligations (a)
Long-term debt (b)
Operating leases (c)
Total contractual obligations
Less Than
1 Year
1–3
Years
Payments Due by Period
3–5
Years
(In thousands)
More Than
5 Years
Total
$
$
116,887 $
221,495 $
212,671 $
1,168,754 $
1,719,807
9,788
19,500
9,948
19,621
58,857
126,675 $
240,995 $
222,619 $
1,188,375 $
1,778,664
_______________________________________________________________________________
(a) The Company has excluded $26.2 million in unrecognized tax benefits and related interest from the table above as we are unable to make a reasonably
reliable estimate of the period in which these liabilities might be paid. For additional information on income taxes, see Note 3 to the consolidated and
combined financial statements.
(b) Represents contractual amounts due including interest on both a fixed and a variable rate instrument. Long-term debt at December 31, 2015 consists of
Match Group Senior Notes of $445 million, which bears interest at a fixed rate, and the Term Loan of $800 million, which bears interest at a variable rate.
The Term Loan currently bears interest at LIBOR plus 4.50%, with a LIBOR floor of 1.00%. The amount of interest ultimately paid on the Term Loan may
differ based on future changes in interest rates.
(c) The Company leases office space, data center facilities and equipment used in connection with its operations under various operating leases, many of which
contain escalation clauses. In addition, future minimum lease payments include our allocable share of an IAC data center lease.
In addition to amounts included in the table above, as of December 31, 2015, we were contingently obligated to pay, in connection with our acquisitions, up to
an additional $168.2 million of cash consideration based on the combination of earnings performance and user grow at the businesses acquired. A substantial portion
of the $168.2 million maximum liability ($79.9 million) relates to the contingent consideration arrangement entered into in connection with one acquisition, which
had its final measurement period at the end of 2015. Based on 2015 results, the Company will not be required to make additional payments with respect to this
contingent consideration arrangement. The Company has accrued $29.0 million as of December 31, 2015 for its other contingent consideration arrangements.
We also had $0.3 million of surety bonds outstanding as of December 31, 2015 that could potentially require performance by the Company in the event of
demands by third parties or contingent events.
Off-Balance Sheet Arrangements
Other than the items described above, the Company does not have any off-balance sheet arrangements as of December 31, 2015.
44
Table of Contents
MATCH GROUP, INC. PRINCIPLES OF FINANCIAL REPORTING
Match Group reports Adjusted EBITDA as a supplemental measure to U.S. generally accepted accounting principles ("GAAP"). This measure is one of the
primary metrics by which we evaluate the performance of our businesses, on which our internal budgets are based and by which management is compensated. We
believe that investors should have access to, and we are obligated to provide, the same set of tools that we use in analyzing our results. This non-GAAP measure
should be considered in addition to results prepared in accordance with GAAP, but should not be considered a substitute for or superior to GAAP results. Match
Group endeavors to compensate for the limitations of the non-GAAP measure presented by providing the comparable GAAP measure with equal or greater
prominence and descriptions of the reconciling items, including quantifying such items, to derive the non-GAAP measure. We encourage investors to examine the
reconciling adjustments between the GAAP and non-GAAP measure, which we discuss below.
Definition of Match Group's Non-GAAP Measures
Adjusted Earnings Before Interest, Taxes, Depreciation and Amortization ("Adjusted EBITDA") is defined as operating income excluding: (1) stock-based
compensation expense; (2) depreciation; and (3) acquisition-related items consisting of (i) amortization of intangible assets and impairments of goodwill and
intangible assets and (ii) gains and losses recognized on changes in the fair value of contingent consideration arrangements. We believe this measure is useful for
analysts and investors as this measure allows a more meaningful comparison between our performance and that of our competitors. Moreover, our management uses
this measure internally to evaluate the performance of our business as a whole and our individual business segments. The above items are excluded from our Adjusted
EBITDA measure because these items are non-cash in nature, and we believe that by excluding these items, Adjusted EBITDA corresponds more closely to the cash
operating income generated from our business, from which capital investments are made and debt is serviced. Adjusted EBITDA has certain limitations in that it does
not take into account the impact to our consolidated and combined statement of operations of certain expenses.
Non-Cash Expenses That Are Excluded From Match Group's Adjusted EBITDA
Stock-based compensation expense consists principally of expense associated with the grants of stock options, restricted stock units ("RSUs") and performance-
based RSUs. These expenses are not paid in cash. Upon the exercise of certain stock options and vesting of RSUs and performance-based RSUs, the awards are
settled, at the Company's discretion, on a net basis, with the Company remitting the required tax-withholding amount from its current funds.
Depreciation is a non-cash expense relating to our property and equipment and is computed using the straight-line method to allocate the cost of depreciable
assets to operations over their estimated useful lives.
Amortization of intangible assets and impairments of goodwill and intangible assets are non-cash expenses. At the time of an acquisition, the identifiable
definite-lived intangible assets of the acquired company, such as customer lists, trade names, content, technology and franchise rights are valued and amortized over
their estimated lives. Value is also assigned to acquired indefinite-lived intangible assets, which comprise trade names and trademarks, and goodwill that are not
subject to amortization. An impairment is recorded when the carrying value of an intangible asset or goodwill exceeds its fair value. We believe that intangible assets
represent costs incurred by the acquired company to build value prior to acquisition and the related amortization and impairment charges of goodwill or intangible
assets, if applicable, are not ongoing costs of doing business.
Gains and losses recognized on changes in the fair value of contingent consideration arrangements are accounting adjustments to report contingent
consideration liabilities at fair value. These adjustments can be highly variable and are excluded from our assessment of performance because they are considered
non-operational in nature and, therefore, are not indicative of current or future performance or ongoing costs of doing business.
45
For a reconciliation of Adjusted EBITDA to operating income (loss) by reportable segment and to net earnings attributable to Match Group, Inc. shareholders
for the years ended December 31, 2015, 2014 and 2013, see Note 13 to the consolidated and combined financial statements.
RECONCILIATION OF ADJUSTED EBITDA
46
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CRITICAL ACCOUNTING POLICIES AND ESTIMATES
The following disclosure is provided to supplement the descriptions of Match Group's accounting policies contained in Note 2 to the consolidated and combined
financial statements in regard to significant areas of judgment. Management of the Company is required to make certain estimates, judgments and assumptions during
the preparation of its consolidated and combined financial statements in accordance with GAAP. These estimates, judgments and assumptions impact the reported
amount of assets, liabilities, revenue and expenses and the related disclosure of contingent assets and liabilities. Actual results could differ from those estimates.
Because of the size of the financial statement elements to which they relate, some of our accounting policies and estimates have a more significant impact on our
consolidated and combined financial statements than others. What follows is a discussion of some of our more significant accounting policies and estimates.
Business Combinations
The purchase price of each acquisition is attributed to the assets acquired and liabilities assumed based on their fair values at the date of acquisition, including
identifiable intangible assets that either arise from a contractual or legal right or are separable from goodwill. The fair value of these intangible assets is based on
detailed valuations that use information and assumptions provided by management. The excess purchase price over the net tangible and identifiable intangible assets
is recorded as goodwill.
In connection with some business combinations, the Company has entered into contingent consideration arrangements that are included in the determination of
the purchase price. Each of these arrangements is recorded at its fair value at the time of the acquisition and reflected at current fair value for each subsequent
reporting period thereafter until settled. The contingent consideration arrangements are generally based upon earnings performance and/or operating metrics such as
monthly active users. The Company determines the fair value of the contingent consideration arrangements by using probability-weighted analyses to determine the
amounts of the gross liability, and, if the arrangement is long-term in nature, applying a discount rate that appropriately captures the risk associated with the obligation
to determine the net amount reflected in the financial statements. Determining the fair value of these arrangements is inherently difficult and subjective. Significant
changes in forecasted earnings or operating metrics would result in a significantly higher or lower fair value measurement and can have a material impact on our
consolidated and combined financial statements. The changes in the estimated fair value of the contingent consideration arrangements each reporting period, including
the accretion of the discount, if applicable, are recognized in “General and administrative expense” in the accompanying consolidated and combined statement of
operations. See Note 7 for a discussion of contingent consideration arrangements.
Recoverability of Goodwill and Indefinite-Lived Intangible Assets
Goodwill and indefinite-lived intangible assets, which consist of the Company's acquired trade names and trademarks, are assessed annually for impairment as
of October 1 or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit or the fair value of
an indefinite-lived intangible asset below its carrying value. The 2015, 2014 and 2013 annual assessments identified no material impairments. The value of goodwill
and indefinite-lived intangible assets that is subject to annual assessment for impairment is $1.3 billion and $243.7 million , respectively, at December 31, 2015.
The Company has the option to qualitatively assess whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. The
Company elected to forgo the option to qualitatively assess the goodwill of its two reporting units, Dating and Non-dating, as of October 1, 2015 and determined the
fair value of each reporting unit. For the Company's annual goodwill test at October 1, 2014, a qualitative assessment of the Non-dating reporting unit's goodwill was
performed. It was determined that it was not more likely than not that the fair value of the reporting unit was less than its carrying value based primarily on valuations
of the reporting unit that were prepared immediately prior to October 1, 2014, in August and September 2014. For the Dating reporting unit, the Company elected to
forgo the option to qualitatively assess goodwill and determined the fair value as of October 1, 2014. As of October 1, 2015, the fair value of each of the Company's
reporting units exceeds its carrying values by more than 20%. When the Company elects to perform a qualitative assessment and concludes it is not more likely than
not that the fair value of the reporting unit is less than its carrying value, no further assessment of that reporting unit's goodwill is necessary; otherwise, goodwill must
be tested for impairment using a two-step process.
The first step involves a comparison of the estimated fair value of each of the Company's reporting units to its carrying value, including goodwill. In performing
the first step, the Company determines the fair value of a reporting unit using both an income approach based on discounted cash flows ("DCF") and a market
approach. Determining fair value using a DCF analysis requires the exercise of significant judgment with respect to several items, including judgment about the
amount and timing of expected future cash flows and appropriate discount rates. The expected cash flows used in the DCF analyses are based on the Company's most
recent budget and, for years beyond the budget, the Company's estimates, which are based, in part, on forecasted growth rates. The discount rates used in the DCF
analyses are intended to reflect the risks inherent in the expected future cash flows of the respective reporting units. Assumptions used in the DCF analyses, including
the discount rate, are assessed annually based on the reporting units' current results and forecast, as well as macroeconomic and industry
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specific factors. The discount rate used in the Company's annual goodwill impairment assessment was 12% in 2015 and 16% in 2014. Determining fair value using a
market approach considers multiples of financial metrics based on both acquisitions and trading multiples of a selected peer group of companies. From the comparable
companies, a representative market multiple is determined which is applied to financial metrics to estimate the fair value of a reporting unit. To determine a peer
group of companies for our respective reporting units, we considered companies relevant in terms of consumer use, monetization model, margin and growth
characteristics and brand strength operating in their respective sectors.
If the estimated fair value of a reporting unit exceeds its carrying value, goodwill of the reporting unit is not impaired and the second step of the impairment test
is not necessary. If the carrying value of a reporting unit exceeds its estimated fair value, then the second step of the goodwill impairment test must be performed. The
second step of the goodwill impairment test compares the implied fair value of the reporting unit's goodwill with its carrying value to measure the amount of
impairment, if any. The implied fair value of goodwill is determined in the same manner as the amount of goodwill recognized in a business combination. In other
words, the estimated fair value of the reporting unit is allocated to all of the assets and liabilities of that unit (including any unrecognized intangible assets) as if the
reporting unit had been acquired in a business combination and the fair value of the reporting unit was the purchase price paid. If the carrying value of the reporting
unit's goodwill exceeds the implied fair value of that goodwill, an impairment is recognized in an amount equal to that excess.
Any impairment charge that might result in the future would be determined based upon the excess of the carrying value of goodwill over its implied fair value
using the second step of the impairment analysis that is described above but, in any event, would not be expected to be lower than the excess of the carrying value of
the reporting unit over its fair value. A primary driver in the DCF valuation analyses and the determination of the fair values of the Company's reporting units is the
estimate of future revenue and profitability. Generally, the Company would expect an impairment if forecasted revenue and profitability are no longer expected to be
achieved and as a result, the carrying value of a reporting unit(s) exceeds its fair value. This assessment would be based, in part, upon the performance of its
businesses relative to budget, the Company's assessment of macroeconomic factors, industry and competitive dynamics and the strategies of its businesses in response
to these factors.
While the Company also has the option to qualitatively assess whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less
than its carrying value, the Company's policy is to determine the fair value of each of its indefinite-lived intangible assets annually as of October 1. The Company
determines the fair values of its indefinite-lived intangible assets using avoided royalty DCF valuation analyses. Significant judgments inherent in these analyses
include the selection of appropriate royalty and discount rates and estimating the amount and timing of expected future cash flows. The discount rates used in the DCF
analyses reflect the risks inherent in the expected future cash flows generated by the respective intangible assets. The royalty rates used in the DCF analyses are based
upon an estimate of the royalty rates that a market participant would pay to license the Company's trade names and trademarks. Assumptions used in the avoided
royalty DCF analyses, including the discount rate and royalty rate, are assessed annually based on the actual and projected cash flows related to the asset, as well as
macroeconomic and industry specific factors. The discount rates used in the Company's annual indefinite-lived impairment assessment ranged from 11% to 16% in
2015 and 10% to 20% in 2014, and the royalty rates used ranged from 3% to 7% in both 2015 and 2014.
Recoverability of Long-Lived Assets
We review the carrying value of all long-lived assets, comprising property and equipment and definite-lived intangible assets, for impairment whenever events
or changes in circumstances indicate that the carrying value of an asset may not be recoverable. The carrying value of a long-lived asset is not recoverable if it
exceeds the sum of the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If the carrying value is deemed not to be
recoverable, an impairment loss is recorded equal to the amount by which the carrying value of the long-lived asset exceeds its fair value. The carrying value of
property and equipment and definite-lived intangible assets is $80.8 million at December 31, 2015.
Income Taxes
We recognize liabilities for uncertain tax positions based on the two-step process. The first step is to evaluate the tax position for recognition by determining if
the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation
processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate settlement. This
measurement step is inherently difficult and requires subjective estimations of such amounts to determine the probability of various possible outcomes. We consider
many factors when evaluating and estimating our tax positions and tax benefits, which may require periodic adjustments and which may not accurately anticipate
actual outcomes. At December 31, 2015, the Company has unrecognized tax benefits of $26.2 million, including interest. Changes to reserves from period to period
and differences between amounts paid, if any, upon resolution of issues raised in audits and amounts previously provided may be material. Differences between the
reserves for income tax contingencies and the amounts owed by the Company are recorded in the period they become known.
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The Company accounts for income taxes under the liability method, and deferred tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying values of existing assets and liabilities and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation
allowance is provided on deferred tax assets if it is determined that it is more likely than not that the deferred tax asset will not be realized. As of December 31, 2015,
the balance of deferred tax liabilities, net, is $23.2 million. Actual income taxes could vary from these estimates due to future changes in income tax law, state income
tax apportionment or the outcome of any review of our tax returns by the various tax authorities, as well as actual operating results of the Company that vary
significantly from anticipated results.
Stock-Based Compensation
Stock-based compensation expense reflected in our consolidated and combined statement of operations consists of expense related to the Company's stock
options and RSUs, equity instruments denominated in shares of subsidiaries, and IAC denominated stock options, RSUs and PSUs held by Match Group employees.
As disclosed in Note 12 to the consolidated and combined financial statements, the Company estimates the fair value of stock options using a Black-Scholes
option pricing model and, for those with a market condition, a lattice model. For stock options, including subsidiary denominated equity, the value of the stock option
is measured at the grant date at fair value and expensed over the vesting term. The impact on stock-based compensation expense for the year ended December 31,
2015, assuming a 1% increase in the risk-free interest rate, a 10% increase in the volatility factor and a one year increase in the weighted average expected term of the
outstanding options would be an increase of $2.2 million, $9.9 million and $6.2 million, respectively. The Company also issues RSUs. For RSUs issued, the value of
the instrument is measured at the grant date as the fair value of Match Group common stock and expensed as stock-based compensation expense over the vesting
term.
Prior to the IPO, the equity awards that relate to the Company's common stock or the common stock of certain of our subsidiaries were settleable in shares of
IAC common stock having a value equal to the difference between the exercise price and the fair market value of our common stock or that of the relevant subsidiary
at the date of exercise. Upon completion of the IPO, the options that relate to the Company's common stock have been adjusted in accordance with their terms to
provide that the awards are exercisable for shares of our common stock, and the equity awards that relate to these subsidiaries provide that the awards are settleable, at
IAC’s election, in shares of IAC common stock or in shares of the Company's common stock. To the extent shares of IAC common stock are issued in settlement of
these awards, the Company will reimburse IAC for the cost of those shares by issuing to IAC additional shares of our common stock. Therefore, the number of shares
issued by the Company to settle these awards will be the same whether issued to IAC as reimbursement or directly to equity award holders.
The aggregate number of Match Group common shares that would have been required to settle these interests at estimated fair values on December 31, 2015,
including vested and unvested interests (and without giving effect to the withholding of shares to cover withholding taxes), is 18.2 million shares (the substantial
majority of which relate to Tinder). The number of shares ultimately needed to settle these awards can vary from the estimated number as a result both of movements
in our stock price and a determination of fair value of the relevant subsidiary that is different than our estimate. Assuming no change in the value of the Company’s
common stock, if the fair value of these subsidiaries were 10% higher or lower than the Company’s December 31, 2015 fair value estimate, the number of shares
required to settle these awards would increase or decrease by 2.4 million shares. Assuming no change in the estimated fair value of these subsidiaries, if the
Company’s stock price were 10% higher or lower the number of shares required to settle these awards would decrease by 1.7 million shares and increase by 2.0
million shares, respectively.
Marketable Securities and Long-term Investments
At December 31, 2015, marketable securities consist of an equity security. Long-term investments include three cost method investments.
Marketable securities are adjusted to fair value each quarter, and the unrealized gains and losses, net of tax, are included in accumulated other comprehensive
income as a separate component of shareholders' equity. The specific-identification method is used to determine the cost of securities sold and the amount of
unrealized gains and losses reclassified out of accumulated other comprehensive income into earnings. Additionally, the Company evaluates its cost method
investments for indicators of impairment on a quarterly basis, and recognizes an impairment loss if the decline in value is deemed to be other-than-temporary. Future
events may result in reconsideration of the nature of losses as other-than-temporary and market and other factors may cause the value of our investments to decline.
The Company employs a methodology that considers available evidence in evaluating potential other-than-temporary impairments of its investments.
Investments are considered to be impaired when a decline in fair value below the cost basis is determined to be other-than-temporary. Such impairment evaluations
include, but are not limited to: the length of time and extent to which fair value has been less than the cost basis, the current business environment, including
competition; going
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concern considerations such as financial condition, the rate at which the investee utilizes cash and the investee's ability to obtain additional financing to achieve its
business plan; the need for changes to the investee's existing business model due to changing business and regulatory environments and its ability to successfully
implement necessary changes; and comparable valuations.
Recent Accounting Pronouncements
For a discussion of recent accounting pronouncements, see Note 2 — Summary of Significant Accounting Policies in the notes to consolidated and combined
financial statements.
50
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Interest Rate Risk
The Company's exposure to market risk for changes in interest rates relates primarily to the Company's long-term debt, including current maturities.
At December 31, 2015, the Company's outstanding debt was $1.245 billion , which consists of an $800 million Term Loan, including $40 million of current
maturities, which bears interest at a variable rate and $445.2 million of Match Group Senior Notes, which bears interest at a fixed rate. If market rates decline, the
Company runs the risk that the related required payments on our fixed rate debt will exceed those based on market rates. A 100 basis point increase or decrease in the
level of interest rates would, respectively, decrease or increase the fair value of the fixed-rate debt by $24.3 million. Such potential increase or decrease in fair value is
based on certain simplifying assumptions, including a constant level and rate of fixed-rate debt and an immediate across-the-board increase or decrease in the level of
interest rates with no other subsequent changes for the remainder of the period. The Term Loan currently bears interest at LIBOR plus 4.50%, with a LIBOR floor of
1.00%. LIBOR, at December 31, 2015, for similar borrowings of three months was approximately 60 basis points. If LIBOR were to increase by 100 basis points, the
annual interest payments on the Term Loan would increase by 60 basis points or $4.8 million in 2016. If LIBOR decreased annual interest payments on the Term
Loan would remain the same because of the 1% floor. Such potential changes in interest payments are based on the quarterly amortization schedule and certain
simplifying assumptions, including a constant rate of variable-rate debt and an immediate across-the-board increase or decrease in the level of interest rates with no
other subsequent changes for the remainder of the period.
Foreign Currency Exchange Risk
The Company conducts business in certain foreign markets, primarily in the European Union. For the year ended December 31, 2015, international revenue
accounted for 32% of consolidated revenue. Our primary exposure to foreign currency exchange risk relates to investments in foreign subsidiaries that transact
business in a functional currency other than the U.S. Dollar, primarily the Euro. As foreign currency exchange rates change, translation of the statement of operations
of our international businesses into U.S. dollars affects year-over-year comparability of operating results. The average Euro versus the U.S. Dollar exchange rate was
16% lower in 2015 than 2014. The decrease had a significant impact to revenue. Total revenue, Dating revenue and International Dating Revenue would have
increased approximately 20%, 15% and 21%, respectively, as compared to the reported increases of 15%, 9% and 3%, respectively, had the foreign currency
exchange rates been the same during 2014.
Foreign currency exchange gains and losses included in the Company's earnings for the years ended December 31, 2015, 2014 and 2013 are gains of $9.9
million and $10.9 million and losses of $1.7 million , respectively. Included in the December 31, 2015 and 2014 amounts are a foreign currency exchange gain of $7.6
million and $8.3 million , respectively, related to a €53 million 5.00% Note that was issued to an IAC subsidiary on April 8, 2014 in connection with the financing of
the purchase of the remaining publicly traded shares of Meetic. This related party debt was a liability of one of the Company's subsidiaries with a U.S. dollar
functional currency and the gain was due to the significant strengthening of the U.S. dollar versus the Euro in 2015. This related party debt was repaid to IAC prior to
the Company's IPO in the fourth quarter of 2015.
Historically, the Company has not hedged any foreign currency exposures. Our continued international expansion increases our exposure to exchange rate
fluctuations and as a result such fluctuations could have a significant impact on our future results of operations.
51
Item 8. Consolidated and Combined Financial Statements and Supplementary Data
Report of Independent Registered Public Accounting Firm
The Board of Directors and Shareholders of Match Group, Inc.
We have audited the accompanying consolidated and combined balance sheet of Match Group, Inc. and subsidiaries (the Company) as of December 31, 2015
and 2014, and the related consolidated and combined statements of operations, comprehensive income, shareholders' equity, and cash flows for each of the three years
in the period ended December 31, 2015. Our audits also included the financial statement schedule listed in the Index at Item 15(a). These financial statements and
financial schedule are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements and schedule based
on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform
an audit of the Company's internal control over financial reporting. Our audits included consideration of internal control over financial reporting as a basis for
designing audit procedures that are appropriate in the circumstances, 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. An audit also includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial
statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated and combined financial position of Match
Group, Inc. and subsidiaries as of December 31, 2015 and 2014, and the consolidated and combined results of their operations and their cash flows for each of the
three years in the period ended December 31, 2015, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, the related financial
statement schedule, when considered in relation to the basic consolidated and combined financial statements taken as a whole, presents fairly in all material respects
the information set forth therein.
New York, New York
March 28, 2016
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/s/ ERNST & YOUNG LLP
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MATCH GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED AND COMBINED BALANCE SHEET
Cash and cash equivalents
Marketable securities
Accounts receivable, net of allowance of $1,739 and $1,133, respectively
ASSETS
Other current assets
Total current assets
Property and equipment, net
Goodwill
Intangible assets, net
Long-term investments
Other non-current assets
TOTAL ASSETS
LIABILITIES AND SHAREHOLDERS' EQUITY
LIABILITIES
Current portion of long-term debt
Accounts payable
Deferred revenue
Accrued expenses and other current liabilities
Total current liabilities
Long-term debt, net of current maturities
Long-term debt, related party
Income taxes payable
Deferred income taxes
Other long-term liabilities
Redeemable noncontrolling interests
Commitments and contingencies
SHAREHOLDERS' EQUITY
Common stock; $0.001 par value; authorized 1,500,000,000 shares; 38,343,333 shares issued and outstanding at December 31, 2015 and
161,130,000 shares issued and outstanding at December 31, 2014 on a pro forma basis
Class B convertible common stock; $0.001 par value; authorized 1,500,000,000 shares; 209,919,402 shares issued and outstanding at
December 31, 2015 and no shares issued and outstanding at December 31, 2014
Class C common stock; $0.001 par value; authorized 1,500,000,000 shares; no shares issued and outstanding
Preferred stock; $0.001 par value; authorized 500,000,000 shares; no shares issued and outstanding
Additional paid-in capital
Retained earnings
Invested capital
Accumulated other comprehensive loss
Total Match Group, Inc. shareholders' equity or invested capital
Noncontrolling interests
Total shareholders' equity or invested capital
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
December 31,
2015
2014
(In thousands, except share data)
$
88,173
$
11,622
65,851
39,049
204,695
48,067
1,292,775
276,408
55,569
48,488
127,630
—
33,735
27,812
189,177
42,997
793,763
207,613
62,979
5,580
1,926,002
$
1,302,109
$
$
40,000
$
25,767
169,321
118,556
353,644
1,193,481
—
9,670
34,947
49,542
5,907
38
210
—
—
404,771
10,612
—
(136,820)
278,811
—
278,811
—
11,797
134,790
94,719
241,306
—
190,586
11,442
41,875
13,446
3,678
—
—
—
—
—
—
877,635
(78,048)
799,587
189
799,776
1,302,109
The accompanying Notes to Consolidated and Combined Financial Statements are an integral part of these statements.
53
$
1,926,002
$
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MATCH GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED AND COMBINED STATEMENT OF OPERATIONS
Revenue
Operating costs and expenses:
Cost of revenue (exclusive of depreciation shown separately below)
Selling and marketing expense
General and administrative expense
Product development expense
Depreciation
Amortization of intangibles
Total operating costs and expenses
Operating income
Interest expense—third party
Interest expense—related party
Other income, net
Earnings before income taxes
Income tax provision
Net earnings
Net earnings attributable to noncontrolling interests
Net earnings attributable to Match Group, Inc. shareholders
Net earnings per share attributable to Match Group, Inc. shareholders:
Basic
Diluted
Stock-based compensation expense by function:
Cost of revenue
Selling and marketing expense
General and administrative expense
Product development expense
Total stock-based compensation expense
Years Ended December 31,
2015
2014
2013
(In thousands, except per share data)
$
1,020,431 $
888,268 $
803,089
177,988
359,598
175,857
67,348
25,983
20,101
826,875
193,556
(18,049)
(8,009)
11,887
179,385
(58,898)
120,487
(104)
120,024
335,107
117,890
49,738
25,547
11,395
659,701
228,567
—
(25,541)
12,610
215,636
(67,277)
148,359
(595)
$
$
$
$
$
120,383 $
147,764 $
0.69 $
0.65 $
0.92 $
0.88 $
490 $
6,787
36,530
6,276
396 $
194
17,326
2,935
50,083 $
20,851 $
85,945
321,870
93,641
42,973
20,202
17,125
581,756
221,333
—
(34,307)
217
187,243
(60,616)
126,627
(1,624)
125,003
0.78
0.76
1,012
562
8,520
2,134
12,228
The accompanying Notes to Consolidated and Combined Financial Statements are an integral part of these statements.
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MATCH GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED AND COMBINED STATEMENT OF COMPREHENSIVE INCOME
Years Ended December 31,
2015
2014
2013
(In thousands)
$
120,487 $
148,359 $
126,627
(63,223)
4,212
(59,011)
61,476
135
(60,101)
(1,950)
(62,051)
86,308
(204)
6,152
702
6,854
133,481
(3,918)
129,563
Net earnings
Other comprehensive (loss) income:
Change in foreign currency translation adjustment
Change in fair value of available-for-sale security
Total other comprehensive (loss) income
Comprehensive income
Comprehensive loss (income) attributable to noncontrolling interests
Comprehensive income attributable to Match Group, Inc. shareholders
$
61,611 $
86,104 $
The accompanying Notes to Consolidated and Combined Financial Statements are an integral part of these statements.
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MATCH GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED AND COMBINED STATEMENT OF SHAREHOLDERS' EQUITY
(In thousands)
Match Group, Inc. Shareholders' Equity or Invested Capital
Common Stock
$0.001
Par Value
Class B Convertible
Common Stock $0.001
Par Value
Redeemable
Noncontrolling
Interests
$
Shares
Shares
(Pro forma)
(a)
$
Shares
Additional
Paid-in
Capital
Retained
Earnings
Invested
Capital
Total
Match Group
Inc.
Shareholders'
Equity or
Invested
Capital
Accumulated
Other
Comprehensive
(Loss) Income
Total
Shareholders'
Equity or
Invested
Capital
Noncontrolling
Interests
Balance as of December 31, 2012
$
40,958
$
Net earnings for the year ended
December 31, 2013
Other comprehensive income, net of
tax
Purchase of redeemable noncontrolling
interests
Purchase of noncontrolling interests
Adjustment of redeemable
noncontrolling interests and
noncontrolling interests to fair value
Transfer from noncontrolling interests
to redeemable noncontrolling interests
Net increase in IAC/InterActiveCorp's
investment in Match Group, Inc.
Other
417
927
(40,182)
—
19,254
2,874
—
—
Balance as of December 31, 2013
24,248
Net earnings for the year ended
December 31, 2014
Other comprehensive (loss) income, net
of tax
Purchase of redeemable noncontrolling
interests
Purchase of noncontrolling interests
Adjustment of redeemable
noncontrolling interests and
noncontrolling interests to fair value
Net decrease in IAC/InterActiveCorp's
investment in Match Group, Inc.
Other
Balance as of December 31, 2014
Net earnings for the year ended
December 31, 2015
Other comprehensive loss, net of tax
Stock-based compensation expense
Purchase of redeemable noncontrolling
interests
Transfer from noncontrolling interests
to redeemable noncontrolling interests
Net (decrease) increase in
IAC/InterActiveCorp's investment in
Match Group, Inc.
Capital contribution from
IAC/InterActiveCorp to partially fund
the acquisition of PlentyOfFish
Capitalization as a result of IPO
Dividend to IAC/InterActiveCorp
Issuance of common stock in
connection with IPO
Issuance of common stock pursuant to
stock-based awards, net of withholding
taxes
Repurchase of stock-based awards
Income tax benefit related to stock-
based awards
Other
595
(494)
(41,743)
—
21,072
—
—
3,678
104
(239)
5,067
(2,864)
189
—
—
—
—
—
—
—
—
(28)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
38
38,333
—
—
—
—
10
—
—
—
Balance as of December 31, 2015
___________________________
5,907
$
$
38
38,343
157,582
$
—
—
—
—
—
—
3,013
—
160,595
—
—
—
—
—
535
—
161,130
—
—
—
—
—
12,678
—
(173,808)
—
—
—
—
—
—
— $
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
174
—
—
—
—
—
—
— $
— $
— $ 717,350
$
(20,948)
$
696,402
$
50,907
$
747,309
125,003
—
125,003
4,560
4,560
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
15,802
—
—
(17,119)
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
(21,563)
—
30,959
—
—
—
—
(30,441)
(91,437)
—
—
—
—
—
—
—
—
—
22,974
—
—
105,970
—
(1,091,346)
1,207
1,367
—
126,210
5,927
—
(12,371)
(12,371)
—
—
(21,563)
2,309
(19,254)
—
30,959
—
(2,874)
(2,874)
—
1,120
30,959
1,120
—
—
—
—
(50,662)
(50,662)
(30,441)
9,369
(21,072)
(91,437)
—
—
—
—
—
—
—
—
—
—
—
—
851,749
(16,388)
835,361
41,665
877,026
147,764
—
147,764
—
147,764
(61,660)
(61,660)
103
(61,557)
—
(286)
189
—
—
—
—
(189)
—
—
—
—
—
—
—
—
—
— $
(91,437)
(286)
799,776
120,383
(58,772)
38,776
—
(189)
88,851
345,000
—
(1,467,768)
428,283
104
(23,431)
7,821
(23)
278,811
(58,772)
(58,772)
—
—
—
—
—
—
—
—
—
—
—
—
38,776
—
—
88,851
345,000
—
(1,467,768)
428,283
104
(23,431)
7,821
(23)
(136,820)
$
278,811
$
877,635
(78,048)
799,587
35,593
84,790
—
120,383
36
36,111
344,964
173,808
1,091,172
—
—
—
—
—
—
(1,442,787)
(24,981)
428,245
104
(23,431)
7,821
—
—
—
—
—
—
—
—
—
—
—
(23)
— $
210
209,919
$ 404,771
$ 10,612
$
(a) Common stock prior to the IPO was presented as a component of Invested Capital as the financial statements were prepared on a combined basis. Pro forma common stock is being presented for
informational purposes.
The accompanying Notes to Consolidated and Combined Financial Statements are an integral part of these statements.
56
Table of Contents
MATCH GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED AND COMBINED STATEMENT OF CASH FLOWS
Cash flows from operating activities:
Net earnings
Adjustments to reconcile net earnings to net cash provided by operating activities:
Stock-based compensation expense
Depreciation
Amortization of intangibles
Excess tax benefits from stock-based awards
Deferred income taxes
Acquisition-related contingent consideration fair value adjustments
Other adjustments, net
Changes in assets and liabilities, excluding effects of acquisitions:
Accounts receivable
Other assets
Accounts payable and accrued expenses and other current liabilities
Income taxes payable
Deferred revenue
Net cash provided by operating activities
Cash flows from investing activities:
Acquisitions, net of cash acquired
Capital expenditures
Purchases of long-term investments
Other, net
Net cash used in investing activities
Cash flows from financing activities:
Borrowings under term loan facility
Debt issuance costs
Fees and expenses related to note exchange
Proceeds from initial public offering, net of fees and expenses
Cash dividend to IAC
Transfers (to) from IAC
Capital contribution from IAC to partially fund the acquisition of PlentyOfFish
(Repayment of) proceeds from related party debt
Excess tax benefits from stock-based awards
Purchase of noncontrolling interests
Repurchase of stock-based awards
Acquisition-related contingent consideration payments
Funds returned from (transferred to) escrow for Meetic tender offer
Other, net
Net cash provided by (used in) financing activities
Effect of exchange rate changes on cash and cash equivalents
Net (decrease) increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
Years Ended December 31,
2015
2014
2013
(In thousands)
$
120,487
$
148,359 $
126,627
50,083
25,983
20,101
(38,384)
(22,530)
(11,056)
(882)
(29,344)
(11,281)
31,716
36,377
37,812
209,082
(611,324)
(29,156)
—
(8,382)
(648,862)
788,000
(17,174)
(6,954)
428,789
(1,022,500)
(86,012)
500,000
(182,509)
38,384
(2,864)
(23,431)
(5,510)
—
—
408,219
(7,896)
(39,457)
127,630
$
88,173
$
20,851
25,547
11,395
(5,319)
(5,904)
(12,912)
(9,016)
2,399
(10,551)
(7,980)
8,103
8,643
173,615
(114,051)
(21,793)
(4,536)
180
(140,200)
—
—
—
—
—
(108,723)
—
111,586
5,319
(33,165)
—
(7,373)
12,354
(56)
(20,058)
(10,953)
2,404
125,226
127,630 $
12,228
20,202
17,125
(10,763)
(3,651)
343
255
(3,651)
(155)
(972)
4,808
12,401
174,797
(32,145)
(19,807)
—
(2,034)
(53,986)
—
—
—
—
—
9,653
—
—
10,763
(52,552)
—
—
(71,512)
(1,614)
(105,262)
2,513
18,062
107,164
125,226
The accompanying Notes to Consolidated and Combined Financial Statements are an integral part of these statements.
57
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS
NOTE 1—ORGANIZATION
Match Group, Inc. is the world's leading provider of dating products. We operate a portfolio of over 45 brands, including Match, OkCupid, PlentyOfFish,
Tinder, Meetic, Twoo, OurTime, BlackPeopleMeet and FriendScout24, each designed to increase our users' likelihood of finding a romantic connection. Through our
portfolio of trusted brands, we provide tailored products to meet the varying preferences of our users. We currently offer our dating products in 38 languages across
more than 190 countries. Match Group operates in two segments: Dating and Non-dating.
Through the brands within our Dating business, we are a leading provider of membership-based and ad-supported dating products servicing North America,
Western Europe and many other countries around the world. We provide these services through websites and applications that we own and operate. The Non-dating
business consists of The Princeton Review, which provides a variety of educational test preparation, academic tutoring and college counseling services.
On November 24, 2015, the Company completed its initial public offering ("IPO") of 38.3 million shares of its common stock at a price of $12.00 per share for
proceeds, net of fees and expenses, of $428.3 million . Following the completion of the IPO, IAC/InterActiveCorp's ("IAC") ownership interest and voting interest in
Match Group were 84.6% and 98.2% , respectively.
All references to "Match Group," the "Company," "we," "our," or "us" in this report are to Match Group, Inc.
NOTE 2—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Consolidation
The Company prepares its consolidated and combined financial statements in accordance with U.S. generally accepted accounting principles ("GAAP"). The
Company's financial statements were prepared on a consolidated basis beginning October 1, 2015 and on a combined basis for periods prior thereto. The difference in
presentation is due to the fact that the final steps of the legal reorganization of the entities included in Match Group, at the time of the IPO, was not completed until
October 1, 2015. The preparation of financial statements on a combined basis for periods prior thereto allows for the financial statements to be presented on a
consistent basis for all periods presented. The combined financial statements reflect the historical financial position, results of operations and cash flows of Match
Group's businesses since their respective dates of acquisition by IAC. The consolidated financial statements include the accounts of the Company, all entities that are
wholly-owned by the Company and all entities in which the Company has a controlling financial interest.
The consolidated and combined financial statements reflect the allocation to Match Group of certain IAC corporate expenses relating to Match Group based on
the historical financial statements and accounting records of IAC through the date of the IPO. Management believes the assumptions underlying the historical
consolidated and combined financial statements, including the basis on which expenses have been allocated from IAC are reasonable and that these consolidated and
combined financial statements reflect all adjustments, consisting of normal and recurring adjustments necessary for the fair presentation of our financial position,
results of operations and cash flows for the years presented.
For the purposes of these financial statements, income taxes have been computed for Match Group on an as if stand-alone, separate tax return basis.
All intercompany transactions and balances between and among the Company, its subsidiaries and the entities comprising Match Group have been eliminated.
Accounting for Investments
Investments in common stock or in-substance common stock of entities in which the Company does not have the ability to exercise significant influence over
the operating and financial matters of the investee are accounted for using the cost method. Investments in companies that the Company does not control, which are
not in the form of common stock or in-substance common stock, are also accounted for using the cost method. The Company evaluates each cost method investment
for impairment on a quarterly basis and recognizes an impairment loss if a decline in value is determined to be other-than-temporary. Such impairment evaluations
include, but are not limited to: the current business environment, including
58
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
competition; going concern considerations such as financial condition and the rate at which the investee utilizes cash and the investee's ability to obtain additional
financing to achieve its business plan; the need for changes to the investee's existing business model due to changing business and regulatory environments and its
ability to successfully implement necessary changes; and comparable valuations. If the Company has not identified events or changes in circumstances that may have
a significant adverse effect on the fair value of a cost method investment, the fair value of such cost method investment is not estimated, as it is impracticable to do so.
Accounting Estimates
Management of the Company is required to make certain estimates, judgments and assumptions during the preparation of its consolidated and combined
financial statements in accordance with GAAP. These estimates, judgments and assumptions impact the reported amounts of assets, liabilities, revenue and expenses
and the related disclosure of contingent assets and liabilities. Actual results could differ from those estimates.
On an ongoing basis, the Company evaluates its estimates and judgments including those related to: the recoverability of goodwill and indefinite-lived
intangible assets; the useful lives and recoverability of definite-lived intangible assets and property and equipment; the fair value of long-term investments; the
carrying value of accounts receivable, including the determination of the allowance for doubtful accounts; the fair value of acquisition-related contingent
consideration; the liabilities for uncertain tax positions; the valuation allowance for deferred income tax assets; and the fair value of and forfeiture rates for stock-
based awards, among others. The Company bases its estimates and judgments on historical experience, its forecasts and budgets and other factors that the Company
considers relevant.
Revenue Recognition
The Company’s Dating revenue is primarily derived directly from users in the form of recurring membership fees.
Membership revenue is presented net of credits and credit card chargebacks. Members pay in advance, primarily by using a credit card, and, subject to certain
conditions identified in our terms and conditions, all purchases are final and nonrefundable. Fees collected, or contractually due, in advance for memberships are
deferred and recognized as revenue using the straight-line method over the terms of the applicable membership period, which primarily range from one to six months.
Deferred revenue at the Dating business is $144.4 million and $117.9 million at December 31, 2015 and 2014, respectively. The Company also earns revenue from
online advertising, the purchase of à la carte features and offline events. Online advertising revenue is recognized every time an ad is displayed. Revenue from the
purchase of à la carte features is recognized based on usage. Revenue and the related expenses associated with offline events are recognized when each event occurs.
Non-dating revenue consists primarily of fees received directly from students for in-person and online test preparation classes, access to online test preparation
materials and individual tutoring services. Fees from classes and access to online materials are recognized over the period of the course and the period of the online
access, respectively. Tutoring fees are recognized based on usage. Deferred revenue at the Non–dating business is $25.7 million and $18.0 million at December 31,
2015 and 2014, respectively.
Cash and Cash Equivalents
Cash and cash equivalents include cash and short-term investments with maturities of less than 91 days from the date of purchase. Cash equivalents at December
31, 2015 consist of international money market funds.
Accounts Receivable
Accounts receivable are stated at amounts due from customers, net of an allowance for doubtful accounts. Accounts receivable outstanding longer than the
contractual payment terms are considered past due. The Company determines its allowance by considering a number of factors, including the length of time accounts
receivable are past due, the Company's previous loss history, the specific customer's ability to pay its obligation to the Company and the condition of the general
economy and the customer's industry. The Company writes off accounts receivable when they become uncollectible.
59
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Property and Equipment
Property and equipment, including significant improvements, are recorded at cost. Repairs and maintenance costs are expensed as incurred. Depreciation is
computed using the straight-line method over the estimated useful lives of the assets as follows:
Asset Category
Computer equipment and capitalized software
Furniture and other equipment
Leasehold improvements
Estimated
Useful Lives
2 to 3 years
3 to 10 years
6 to 7 years
The Company capitalizes certain internal use software costs including external direct costs utilized in developing or obtaining the software and compensation for
personnel directly associated with the development of the software. Capitalization of such costs begins when the preliminary project stage is complete and ceases
when the project is substantially complete and ready for its intended purpose. The net book value of capitalized internal use software was $20.7 million and $20.9
million at December 31, 2015 and 2014 , respectively.
Business Combinations
The purchase price of each acquisition is attributed to the assets acquired and liabilities assumed based on their fair values at the date of acquisition, including
identifiable intangible assets that either arise from a contractual or legal right or are separable from goodwill. The fair value of these intangible assets is based on
detailed valuations that use information and assumptions provided by management. The excess purchase price over the net tangible and identifiable intangible assets
is recorded as goodwill.
In connection with some business combinations, the Company has entered into contingent consideration arrangements that are included in the determination of
the purchase price. Each of these arrangements is initially recorded at its fair value at the time of the acquisition and reflected at current fair value for each subsequent
reporting period thereafter until settled. The contingent consideration arrangements are generally based upon earnings performance and/or operating metrics such as
monthly active users. The Company determines the fair value of the contingent consideration arrangements by using probability-weighted analyses to determine the
amounts of the gross liability, and, if the arrangement is long-term in nature, applying a discount rate that appropriately captures the risk associated with the obligation
to determine the net amount reflected in the financial statements. Determining the fair value of these arrangements is inherently difficult and subjective. Significant
changes in forecasted earnings or operating metrics would result in a significantly higher or lower fair value measurement and can have a material impact on our
consolidated and combined financial statements. The changes in the estimated fair value of the contingent consideration arrangements for each reporting period,
including the accretion of the discount, if applicable, are recognized in “General and administrative expense” in the accompanying consolidated and combined
statement of operations. See Note 7 for a discussion of contingent consideration arrangements.
Goodwill and Indefinite-Lived Intangible Assets
Goodwill acquired in business combinations is assigned to the reporting unit(s) that is expected to benefit from the combination as of the acquisition date. The
Company assesses goodwill and indefinite-lived intangible assets for impairment annually as of October 1, or more frequently if an event occurs or circumstances
change that would more likely than not reduce the fair value of a reporting unit or the fair value of an indefinite-lived intangible asset below its carrying value. The
2015, 2014 and 2013 annual assessments identified no material impairments. For all periods presented, the Company has two reporting units: Dating and Non-dating.
The Company has the option to qualitatively assess whether it is more likely than not that the fair value of a reporting unit is less than its carrying value. The
Company elected to forgo the option to qualitatively assess the goodwill of its two reporting units, Dating and Non-dating, as of October 1, 2015 and determined the
fair value of each reporting unit. For the Company's annual goodwill test at October 1, 2014, a qualitative assessment of the Non-dating reporting unit's goodwill was
preformed. It
60
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
was determined that it was not more likely than not that the fair value of the reporting unit was less than its carrying value based primarily on valuations of the
reporting unit that were prepared immediately prior to October 1, 2014, in August and September 2014. For the Dating reporting unit, the Company elected to forgo
the option to qualitatively assess goodwill and determined the fair value as of October 1, 2014. The discount rate used in the Company's annual goodwill impairment
assessment was 12% in 2015 and 16% in 2014. As of October 1, 2015, the fair value of each of the Company's reporting units exceeds its carrying values by more
than 20%.
When the Company elects to perform a qualitative assessment and concludes it is not more likely than not that the fair value of the reporting unit is less than its
carrying value, no further assessment of that reporting unit's goodwill is necessary; otherwise, the fair value of the reporting unit has to be determined and if the
carrying value of a reporting unit's goodwill exceeds its implied fair value, an impairment loss equal to the excess is recorded. When the Company evaluates the
potential for goodwill impairment using a qualitative assessment it considers factors including, but not limited to, the fair values of recent valuations, changes in the
reporting unit's financial performance, forecasts, key personnel, and strategy, as well as changes in the industry conditions, including competition and demand for the
reporting unit's services, and macroeconomic conditions.
The Company determines the fair value of its reporting units using both an income approach based on discounted cash flows ("DCF") and a market approach.
Determining fair value using a DCF analysis requires the exercise of significant judgment with respect to several items, including the judgment about the amount and
timing of expected future cash flows and appropriate discount rates. The expected cash flows used in the DCF analyses are based on the Company's most recent
budget and, for years beyond the budget, the Company's estimates, which are based, in part, on forecasted growth rates. The discount rates used in the DCF analyses
are intended to reflect the risks inherent in the expected future cash flows of the respective reporting units. Assumptions used in the DCF analyses, including the
discount rate, are assessed annually based on each of the reporting unit's current results and forecast, as well as macroeconomic and industry specific factors.
Determining fair value using a market approach considers multiples of financial metrics based on both acquisitions and trading multiples of a selected peer group of
companies. From the comparable companies, a representative market multiple is determined which is applied to financial metrics to estimate the fair value of a
reporting unit. To determine a peer group of companies for our respective reporting units, we considered companies relevant in terms of consumer use, monetization
model, margin and growth characteristics and brand strength operating in their respective sectors.
While the Company also has the option to qualitatively assess whether it is more likely than not that the fair value of an indefinite-lived intangible asset is less
than its carrying value, the Company's policy is to determine the fair value of each of its indefinite-lived intangible assets annually as of October 1. The Company
determines the fair values of its indefinite-lived intangible assets using avoided royalty DCF valuation analyses. Significant judgments inherent in these analyses
include the selection of appropriate royalty and discount rates and estimating the amount and timing of expected future cash flows. The discount rates used in the DCF
analyses reflect the risks inherent in the expected future cash flows generated by the respective intangible assets. The royalty rates used in the DCF analyses are based
upon an estimate of the royalty rates that a market participant would pay to license the Company's trade names and trademarks. Assumptions used in the avoided
royalty DCF analyses, including the discount rate and royalty rate, are assessed annually based on the actual and projected cash flows related to the asset, as well as
macroeconomic and industry specific factors. The discount rates used in the Company's annual indefinite-lived impairment assessment ranged from 11% to 16% in
2015 and 10% to 20% in 2014, and the royalty rates used ranged from 3% to 7% in both 2015 and 2014 .
Long-Lived Assets and Intangible Assets with Definite Lives
Long-lived assets, which consist of property and equipment and intangible assets with definite lives, are reviewed for impairment whenever events or changes in
circumstances indicate that the carrying value of an asset may not be recoverable. The carrying value of a long-lived asset is not recoverable if it exceeds the sum of
the undiscounted cash flows expected to result from the use and eventual disposition of the asset. If the carrying value is deemed not to be recoverable, an impairment
loss is recorded equal to the amount by which the carrying value of the long-lived asset exceeds its fair value. Amortization of definite-lived intangible assets is
computed either on a straight-line basis or based on the pattern in which the economic benefits of the asset will be realized.
61
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Fair Value Measurements
The Company categorizes its financial instruments measured at fair value into a fair value hierarchy that prioritizes the inputs used in pricing the asset or
liability. The three levels of the fair value hierarchy are:
• Level 1: Observable inputs obtained from independent sources, such as quoted prices for identical assets and liabilities in active markets.
• Level 2: Other inputs which are observable directly or indirectly, such as quoted prices for similar assets or liabilities in active markets, quoted prices for
identical or similar assets or liabilities in markets that are not active and inputs that are derived principally from or corroborated by observable market data.
The fair values of the Company's Level 2 financial assets are primarily obtained from observable market prices for identical underlying securities that may
not be actively traded. Certain of these securities may have different market prices from multiple market data sources, in which case an average market price
is used.
• Level 3: Unobservable inputs for which there is little or no market data and require the Company to develop its own assumptions, based on the best
information available in the circumstances, about the assumptions market participants would use in pricing the assets or liabilities. See Note 7 for a
discussion of fair value measurements made using Level 3 inputs.
The Company's non-financial assets, such as goodwill, intangible assets and property and equipment, as well as cost method investments, are adjusted to fair
value only when an impairment charge is recognized. Such fair value measurements are based predominantly on Level 3 inputs.
Advertising Costs
Advertising costs are expensed in the period incurred (when the advertisement first runs for production costs that are initially capitalized) and represent online
marketing, including fees paid to search engines, offline marketing, which is primarily television advertising, and partner-related payments to those who direct traffic
to our websites. Advertising expense was $323.9 million , $309.4 million and $297.5 million for the years ended December 31, 2015 , 2014 and 2013, respectively.
Legal Costs
Legal costs are expensed as incurred.
Income Taxes
Match Group is a member of IAC's consolidated federal and state income tax returns. In all periods presented, current and deferred income tax expense has been
computed for Match Group on an as if stand-alone, separate return basis.
The Company recognizes liabilities for uncertain tax positions based on a two-step process. The first step is to evaluate the tax position for recognition by
determining if the weight of available evidence indicates it is more likely than not that the position will be sustained on audit, including resolution of related appeals
or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate
settlement.
The Company accounts for income taxes under the liability method, and deferred tax assets and liabilities are recognized for the future tax consequences
attributable to differences between the financial statement carrying values of existing assets and liabilities and their respective tax bases. Deferred tax assets and
liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. A valuation
allowance is provided on deferred tax assets if it is determined that it is more likely than not that the deferred tax asset will not be realized. The Company records
interest, net of any applicable related income tax benefit, on potential income tax contingencies as a component of income tax expense.
62
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Earnings Per Share
Basic earnings per share is computed by dividing net earnings attributable to Match Group shareholders by the weighted average number of common shares
outstanding during the period. Diluted earnings per share reflects the potential dilution that could occur if stock options and other commitments to issue common
stock were exercised or equity awards vested resulting in the issuance of common stock that could share in the earnings of the Company.
Foreign Currency Translation and Transaction Gains and Losses
The financial position and operating results of foreign entities whose primary economic environment is based on their local currency are combined using the
local currency as the functional currency. These local currency assets and liabilities are translated at the rates of exchange as of the balance sheet date, and local
currency revenue and expenses of these operations are translated at average rates of exchange during the reporting period. Translation gains and losses are included in
accumulated other comprehensive income as a component of shareholders' equity. Transaction gains and losses resulting from assets and liabilities denominated in a
currency other than the functional currency are included in the consolidated and combined statement of operations as a component of "Other income, net".
Translation gains and losses relating to foreign entities that are liquidated or substantially liquidated are reclassified out of accumulated other comprehensive
loss into earnings. Such gains totaled $2.2 million during the year ended December 31, 2015, and were included in "Other income, net" in the accompanying
consolidated and combined statement of operations.
Stock-Based Compensation
Stock-based compensation is measured at the grant date based on the fair value of the award and is generally expensed over the requisite service period. See
Note 12 for a discussion of the Company's stock-based compensation plans.
Redeemable Noncontrolling Interests
Noncontrolling interests in the consolidated subsidiaries of the Company should ordinarily be reported on the consolidated and combined balance sheet within
shareholders' equity, separately from the Company's equity. However, securities that are redeemable at the option of the holder and not solely within the control of the
issuer must be classified outside of shareholders' equity. Accordingly, if redemption of the noncontrolling interest is outside the control of the Company, the interests
are included outside of shareholders' equity in the accompanying consolidated and combined balance sheet.
In connection with the acquisition of certain subsidiaries, current and former senior management of these businesses has retained an ownership interest. The
Company is party to fair value put and call arrangements with respect to these interests. These put and call arrangements allow management of these businesses to
require the Company to purchase these interests or allow the Company to acquire such interests at fair value, respectively. The put arrangements do not meet the
definition of a derivative instrument as the put agreements do not provide for net settlement. No put and call arrangements were exercised during 2015 or 2014.
During 2013, one of these arrangements was exercised. These put arrangements are exercisable by the counter-party outside the control of the Company. Accordingly,
to the extent that the fair value of these interests exceeds the value determined by normal noncontrolling interest accounting, the value of such interests is adjusted to
fair value with a corresponding adjustment to additional paid-in capital/invested capital. During the years ended December 31, 2015, 2014 and 2013, the Company
recorded adjustments of less than $(0.1) million , $21.1 million and $19.3 million , respectively, to (decrease) increase these interests to fair value. Fair value
determinations require high levels of judgment and are based on various valuation techniques, including market comparables and discounted cash flow projections.
Certain Risks and Concentrations
The Company's business is subject to certain risks and concentrations including dependence on third-party technology providers, exposure to risks associated
with online commerce security and credit card fraud.
Financial instruments, which potentially subject the Company to concentration of credit risk, consist primarily of cash and cash equivalents. Cash and cash
equivalents are principally maintained with financial institutions that are not covered by deposit insurance.
63
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Recent Accounting Pronouncements
In May 2014, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2014-09, Revenue from Contracts with
Customers, which clarifies the principles for recognizing revenue and develops a common standard for all industries. In July 2015, the FASB decided to defer the
effective date for annual reporting periods beginning after December 15, 2017. Early adoption is permitted beginning on the original effective date of December 15,
2016. Upon adoption, ASU No. 2014-09 may either be applied retrospectively to each prior period presented retrospectively with the cumulative effect recognized as
of the date of initial application. The Company is currently evaluating the new guidance and has not yet determined whether the adoption of the new standard will
have a material impact on its consolidated and combined financial statements or the method and timing of adoption.
In November 2015, the FASB issued ASU No. 2015-17, Income Taxes, which requires that deferred tax assets and liabilities be classified as non-current in the
balance sheet. Prior to the issuance of the standard, deferred tax assets and liabilities were required to be separately classified into a current amount and a non-current
amount in the balance sheet. The new guidance is required to be adopted in annual periods beginning after December 15, 2016. Early adoption is permitted and may
be applied prospectively or retrospectively. The Company has elected to early adopt the guidance as of December 31, 2015 and to apply the guidance retrospectively
to all periods presented. The adoption of ASU 2015-17 did not have a material effect on the Company's consolidated and combined financial statements.
In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which supersedes existing guidance on accounting for leases in "Leases (Topic 840)"
and generally requires all leases to be recognized in the statement of financial position. The provisions of ASU 2016-02 are effective for reporting periods beginning
after December 15, 2018; early adoption is permitted. The provisions of ASU 2016-02 are to be applied using a modified retrospective approach. The Company is
currently evaluating the new guidance and has not yet determined whether the adoption of the new standard will have a material impact on its consolidated and
combined financial statements.
Reclassification
Certain prior year amounts have been reclassified to conform to current year presentation.
NOTE 3—INCOME TAXES
Match Group is a member of IAC's consolidated federal and state income tax returns. In all periods presented, current income tax provision and deferred income
tax benefit have been computed for Match Group on an as if stand-alone, separate return basis. Match Group's payments to IAC for its share of IAC's consolidated
federal and state tax return liabilities have been reflected within cash flows from operating activities in the accompanying consolidated and combined statement of
cash flows.
U.S. and foreign earnings before income taxes are as follows:
U.S.
Foreign
Total
The components of the provision for income taxes are as follows:
64
Years Ended December 31,
2015
2014
(In thousands)
2013
$
$
149,340 $
147,210 $
30,045
68,426
179,385 $
215,636 $
152,645
34,598
187,243
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Current income tax provision:
Federal
State
Foreign
Current income tax provision
Deferred income tax (benefit) provision:
Federal
State
Foreign
Deferred income tax benefit
Income tax provision
Years Ended December 31,
2015
2014
(In thousands)
2013
$
68,420 $
53,579 $
7,336
5,672
81,428
(15,131)
(1,735)
(5,664)
(22,530)
6,045
13,557
73,181
(4,188)
(159)
(1,557)
(5,904)
$
58,898 $
67,277 $
49,140
3,856
11,271
64,267
722
197
(4,570)
(3,651)
60,616
Current income tax payable was reduced by $38.4 million , $5.3 million , and $10.8 million for the years ended December 31, 2015 , 2014 and 2013,
respectively, for excess tax deductions attributable to stock-based compensation which is included as financing activity on the consolidated and combined statement of
cash flows.
The tax effects of cumulative temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities are presented
below. The valuation allowance is primarily related to deferred tax assets for net operating losses.
Deferred tax assets:
Accrued expenses
Net operating loss carryforwards
Stock-based compensation
Fair value investments
Other
Total deferred tax assets
Less valuation allowance
Net deferred tax assets
Deferred tax liabilities:
Intangible and other assets
Other
Total deferred tax liabilities
Net deferred tax liabilities
December 31,
2015
2014
(In thousands)
$
8,088 $
33,373
25,269
2,129
5,627
74,486
(23,244)
51,242
(73,172)
(1,230)
(74,402)
$
(23,160) $
6,936
32,147
13,142
3,708
3,172
59,105
(24,805)
34,300
(69,131)
(6,028)
(75,159)
(40,859)
At December 31, 2015 , the Company has federal and state net operating losses ("NOLs") of $25.4 million and $10.7 million , respectively. If not utilized, the
federal NOLs will expire at various times between 2031 and 2034, and the state NOLs will expire at various times between 2016 and 2035. Utilization of federal and
state NOLs will be subject to limitations under Section 382 of the Internal Revenue Code and applicable state law. At December 31, 2015 , the Company has foreign
NOLs of $84.9 million available to offset future income. Of these foreign NOLs, $78.7 million can be carried forward indefinitely and
65
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
$6.2 million will expire at various times between 2016 and 2035. During 2015, the Company recognized tax benefits related to NOLs of $2.7 million .
During 2015 , the Company's valuation allowance increased by $1.6 million primarily due to a decrease in unbenefited unrealized losses. At December 31, 2015
, the Company has a valuation allowance of $23.5 million related to the portion of NOLs and other items for which it is more likely than not that the tax benefit will
not be realized.
A reconciliation of the income tax provision to the amounts computed by applying the statutory federal income tax rate to earnings before income taxes is shown
as follows:
Years Ended December 31,
2015
2014
(In thousands)
2013
Income tax provision at the federal statutory rate of 35%
$
62,785 $
75,472 $
Change in tax reserves, net
State income taxes, net of effect of federal tax benefit
Foreign income taxed at a different statutory rate
Non-taxable contingent consideration fair value adjustments
Non-taxable foreign currency exchange gains
Other, net
Income tax provision
(595)
3,626
(2,699)
(3,898)
(3,776)
3,455
(283)
3,826
(975)
(4,439)
(4,107)
(2,217)
$
58,898 $
67,277 $
65,535
(4,524)
2,814
(976)
—
—
(2,233)
60,616
No income taxes have been provided on indefinitely reinvested earnings of certain foreign subsidiaries aggregating $269.3 million at December 31, 2015 . The
estimated amount of the unrecognized deferred income tax liability with respect to such earnings would be $43.6 million .
A reconciliation of the beginning and ending amount of unrecognized tax benefits, excluding interest, is as follows:
Balance at January 1,
Additions based on tax positions related to the current year
Additions for tax positions of prior years
Reductions for tax positions of prior years
Settlements
Expiration of applicable statute of limitations
Balance at December 31,
2015
December 31,
2014
(In thousands)
2013
10,935 $
11,215 $
2,903
12,846
(902)
—
(874)
201
490
(60)
—
(911)
24,908 $
10,935 $
16,788
1,188
665
(12)
(4,724)
(2,690)
11,215
$
$
The Company recognizes interest and, if applicable, penalties related to unrecognized tax benefits in the income tax provision. At both December 31, 2015 and
2014 , the Company had accrued $1.3 million and $1.2 million , respectively, for the payment of interest. At December 31, 2015 and 2014 , the Company had accrued
$1.8 million and $2.4 million , respectively, for penalties.
Match Group is routinely under audit by federal, state, local and foreign authorities in the area of income tax as a result of previously filed separate company tax
returns and consolidated tax returns with IAC. These audits include questioning the timing and the amount of income and deductions and the allocation of income and
deductions among various tax jurisdictions. The Internal Revenue Service is currently auditing IAC's federal income tax returns for the years ended
December 31, 2010 through 2012, which includes the operations of Match Group. Various other jurisdictions are open to examination for various
66
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
tax years beginning with 2009. Income taxes payable include reserves considered sufficient to pay assessments that may result from examination of prior year tax
returns. Changes to reserves from period to period and differences between amounts paid, if any, upon the resolution of audits and amounts previously provided may
be material. Differences between the reserves for income tax contingencies and the amounts owed by the Company are recorded in the period they become known.
At December 31, 2015 and 2014 , unrecognized tax benefits, including interest, were $26.2 million and $12.1 million , respectively. At December 31, 2015 and
2014 , approximately $16.4 million and $0.7 million , respectively, were included in unrecognized tax benefits for tax positions included in IAC's consolidated tax
return filings. If unrecognized tax benefits at December 31, 2015 are subsequently recognized, $25.8 million , net of related deferred tax assets and interest, would
reduce income tax expense. The comparable amount as of December 31, 2014 was $ 11.8 million . The Company believes that it is reasonably possible that its
unrecognized tax benefits could decrease by approximately $1.4 million by December 31, 2016, primarily due to expirations of statutes of limitations.
NOTE 4—BUSINESS COMBINATION
On October 28, 2015, the Company completed the purchase of all the outstanding shares of Plentyoffish Media Inc. ("PlentyOfFish"), a leading provider of
subscription-based and ad-supported online personals servicing North America, Europe, Latin America and Australia. Services are provided through websites and
mobile applications that PlentyOfFish owns and operates. The purchase price was $575 million in cash, subject to a working capital adjustment not yet finalized.
The financial results of PlentyOfFish are included in Match Group's consolidated financial statements, within the Dating segment, beginning October 28, 2015.
For the year ended December 31, 2015, the Company included $8.0 million of revenue and $0.7 million net earnings in its consolidated statement of operations
related to PlentyOfFish. The estimated fair value of the assets acquired and liabilities assumed of PlentyOfFish reflected in the consolidated balance sheet at
December 31, 2015 are preliminary. The Company is in the process of completing its determination of the fair values of assets acquired and liabilities assumed and
the preliminary fair values are subject to revision. These fair values are expected to be finalized in the first quarter of 2016.
The table below summarizes the estimated fair values of the assets acquired and liabilities assumed at the date of acquisition:
Cash and cash equivalents
Other current assets
Computer and other equipment
Goodwill
Intangible assets
Other non-current assets
Total assets
Current liabilities
Other long-term liabilities
Net assets acquired
(In thousands)
4,626
4,460
2,990
489,494
84,100
1,073
586,743
(6,418)
(5,325)
575,000
$
$
The purchase price was based on the expected financial performance of PlentyOfFish, not on the value of the net identifiable assets at the time of acquisition,
which resulted in a significant portion of the purchase price being attributed to goodwill. The expected financial performance of PlentyOfFish reflects that it is
complementary and synergistic to the existing Dating businesses.
Intangible assets are as follows:
67
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Indefinite-lived trade name
Customer relationships
New registrants
Non-compete agreement
Developed technology
Total intangible assets acquired
Weighted-Average
Useful Life
(Years)
Indefinite
Less than 1
Less than 1
5
2
(In thousands)
66,300
10,100
3,100
3,000
1,600
84,100
$
$
PlentyOfFish's other current assets, property and equipment, other non-current assets, current liabilities and other long-term liabilities were reviewed and
adjusted to their fair values at the date of acquisition, as necessary. The fair values of trade names, customer relationships and the non-compete agreement were
determined using variations of the income approach; specifically, in respective order, the relief from royalty, excess earnings and with or without methodologies. The
fair values of new registrants and developed technology were determined using a cost approach that utilized the cost to replace methodology. The valuations of the
intangible assets incorporate significant unobservable inputs and require significant judgment and estimates, including the amount and timing of future cash flows and
the determination of royalty and discount rates. The amount attributed to goodwill is not tax deductible.
Pro forma Financial Information
The unaudited pro forma financial information in the table below presents the combined results of Match Group and PlentyOfFish as if the acquisition of
PlentyOfFish had occurred on January 1, 2014. The pro forma financial information includes adjustments required under the acquisition method of accounting and is
presented for informational purposes only and is not necessarily indicative of what the results would have been had the acquisition actually occurred on the date
specified above. For the years ended December 31, 2015 and 2014, pro forma adjustments reflected below include increases of $1.4 million and $14.6 million ,
respectively, in amortization of intangible assets.
Revenue
Net earnings attributable to Match Group, Inc. shareholders
Basic earnings per share attributable to Match Group, Inc. shareholders
Diluted earnings per share attributable to Match Group, Inc. shareholders
NOTE 5—GOODWILL AND INTANGIBLE ASSETS
Goodwill and intangible assets, net, are as follows:
Goodwill
Intangible assets with indefinite lives
Intangible assets with definite lives, net
Total goodwill and intangible assets, net
Years Ended December 31,
2015
2014
(In thousands, except per share data)
$
1,098,785 $
156,510
0.90
0.85
936,614
156,444
0.97
0.93
December 31,
2015
2014
(In thousands)
1,292,775 $
243,697
32,711
793,763
180,558
27,055
1,569,183 $
1,001,376
$
$
The following table presents the balance of goodwill, by reporting unit, including the changes in the carrying value of goodwill, for the year ended
December 31, 2015 :
68
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Dating
Non-dating
Total
Balance at
December 31, 2014
Additions
(Deductions)
(In thousands)
Foreign
Exchange
Translation
Balance at
December 31, 2015
$
$
718,129 $
549,146 $
75,634
2,475
793,763 $
551,621 $
— $
(3,711)
(3,711) $
(48,895) $
(3)
(48,898) $
1,218,380
74,395
1,292,775
Dating additions primarily related to the acquisitions of PlentyOfFish and Eureka.
The following table presents the balance of goodwill, by reporting unit, including the changes in the carrying value of goodwill, for the year ended
December 31, 2014 :
Dating
Non-dating
Total
Balance at
December 31, 2013
Additions
(Deductions)
(In thousands)
Foreign
Exchange
Translation
Balance at
December 31, 2014
$
$
751,005 $
16,741
767,746 $
12,371 $
60,462
72,833 $
(350) $
(1,581)
(1,931) $
(44,897) $
12
(44,885) $
718,129
75,634
793,763
Dating additions primarily related to the acquisition of FriendScout24. Non-dating additions primarily relate to the acquisition of The Princeton Review.
Intangible assets with indefinite lives are trade names and trademarks acquired in various acquisitions. At December 31, 2015 and 2014, intangible assets with
definite lives were as follows:
Customer lists
Trade names
Content
Technology
Other
Total
Gross
Carrying
Amount
December 31, 2015
Accumulated
Amortization
Net
Weighted-Average
Useful Life
(Years)
$
$
23,502 $
11,406
9,802
6,333
4,900
(In thousands)
(8,113) $
15,389
(6,501)
(3,508)
(4,472)
(638)
4,905
6,294
1,861
4,262
55,943 $
(23,232) $
32,711
2.3
2.6
4.0
2.4
5.0
2.9
69
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
December 31, 2014
Gross
Carrying
Amount
Accumulated
Amortization
(In thousands)
$
19,060 $
(10,797) $
8,627
9,802
5,390
2,000
(3,001)
(1,024)
(2,744)
(258)
Net
Weighted-Average
Useful Life
(Years)
8,263
5,626
8,778
2,646
1,742
2.9
2.8
4.0
2.5
4.8
3.1
$
44,879 $
(17,824) $
27,055
Customer Lists
Trade names
Content
Technology
Other
Total
At December 31, 2015 , estimated amortization expense for intangible assets with definite lives for each of the next five succeeding years and thereafter is as
follows:
2016
2017
2018
2019
2020 and thereafter
Total
(In thousands)
21,699
6,985
2,600
926
501
32,711
$
$
NOTE 6—MARKETABLE SECURITIES AND LONG-TERM INVESTMENTS
Marketable securities at December 31, 2015 consist of an equity security. At December 31, 2014 this security was classified as a long-term investment in the
accompanying consolidated and combined balance sheet. The cost basis of the Company's equity security at December 31, 2015 and 2014 was $8.7 million , with a
gross unrealized gain of $3.0 million and a gross unrealized loss of $1.2 million , respectively. The gross unrealized gain at December 31, 2015 and gross unrealized
loss at December 31, 2014 are included in "Accumulated other comprehensive loss" in the accompanying consolidated and combined balance sheet.
Long-term investments consist of:
Cost method investments
Long-term marketable equity security
Total long-term investments
December 31,
2015
2014
(In thousands)
$
$
55,569 $
—
55,569 $
55,569
7,410
62,979
The Company has a 21% interest in the voting common stock of Zhenai Inc. ("Zhenai"), a leading provider of online dating and matchmaking services in China.
However, given the significance of our interest relative to other shareholders, we do not have the ability to exercise significant influence over the operating and
financial matters of Zhenai and this investment is accounted for as a cost method investment.
70
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
NOTE 7—FAIR VALUE MEASUREMENTS AND FINANCIAL INSTRUMENTS
The following tables present the Company's financial instruments that are measured at fair value on a recurring basis:
Assets:
Cash equivalents:
Money market funds
Marketable securities:
Equity security
Total
Liabilities:
Contingent consideration arrangements
Assets:
Cash equivalents:
Money market funds
Time deposits
Long-term investments:
Marketable equity security
Total
Liabilities:
Contingent consideration arrangements
Quoted Market
Prices in Active
Markets for
Identical Assets
(Level 1)
December 31, 2015
Significant Other
Observable Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
(In thousands)
Total
Fair Value
Measurements
3,649 $
11,622
15,271 $
— $
—
— $
— $
3,649
—
— $
11,622
15,271
— $
— $
(28,993) $
(28,993)
Quoted Market
Prices in Active
Markets for
Identical Assets
(Level 1)
December 31, 2014
Significant Other
Observable Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
(In thousands)
Total
Fair Value
Measurements
57,057 $
—
7,410
64,467 $
— $
13,405
—
13,405 $
— $
—
—
— $
57,057
13,405
7,410
77,872
— $
— $
(20,615) $
(20,615)
$
$
$
$
$
$
The following table presents the changes in the Company's financial instruments that are measured at fair value on a recurring basis using significant
unobservable inputs (Level 3):
71
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Balance at January 1,
Total net gains:
Fair value adjustments
Foreign currency exchange gains
Included in other comprehensive (loss) income
Fair value at date of acquisition
Settlements
Balance at December 31,
Contingent consideration arrangements
December 31,
2015
Contingent
Consideration
Arrangements
2014
Contingent
Consideration
Arrangements
(In thousands)
$
(20,615) $
(43,625)
11,056
626
1,872
(27,442)
5,510
$
(28,993) $
12,912
—
3,025
(300)
7,373
(20,615)
As of December 31, 2015 , there are five contingent consideration arrangements related to business acquisitions. The maximum contingent payments related to
these arrangements was $168.2 million and the fair value at December 31, 2015 was $29.0 million . The contingent consideration arrangements are based upon
earnings performance and/or operating metrics such as monthly active users. The Company determines the fair value of the contingent consideration arrangements by
using probability-weighted analyses to determine the amounts of the gross liability, and, if the arrangement is long-term in nature, applying a discount rate, that
appropriately captures the risks associated with the obligation to determine the net amount reflected in the financial statements. The number of scenarios in the
probability-weighted analyses can vary; generally, more scenarios are prepared for longer duration and more complex arrangements.
The most significant of the five contingent consideration arrangements, in terms of maximum contingent payments, relates to the acquisition, on January 4,
2013, of Massive Media NV, which operates Twoo.com, a social discovery website that allows its users to meet new people. The Twoo.com contingent consideration
arrangement is payable in three annual installments, which began in 2014. Payments are based upon EBITDA and number of monthly active users. The 2015 and
2014 installments of $5.5 million and $7.4 million were paid in the second quarters of 2015 and 2014, respectively. The remaining aggregate amount of the 2016
installment payment cannot exceed €72.9 million ( $79.9 million at December 31, 2015 ). Based on 2015 results, the Company will not be required to make additional
payments with respect to this contingent consideration arrangement.
The fair values of the contingent consideration arrangements are sensitive to changes in the forecasts of earnings and/or the relevant operating metrics and
changes in discount rates. The Company remeasures the fair value of the contingent consideration arrangements each reporting period, including the accretion of the
discount, if applicable, and changes are recognized in “General and administrative expense” in the accompanying consolidated and combined statement of operations.
The contingent consideration arrangements liability of $29.0 million at December 31, 2015 is long-term in nature and is included in “Other long-term liabilities” in the
accompanying consolidated and combined balance sheet.
Financial instruments measured at fair value only for disclosure purposes
The following table presents the carrying value and the fair value of financial instruments measured at fair value only for disclosure purposes.
72
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Current maturities of long-term debt
Long-term debt, net of current maturities
Long-term debt, related party
December 31, 2015
December 31, 2014
Carrying Value
Fair Value
Carrying Value
Fair Value
(In thousands)
$
(40,000) $
(39,850) $
(1,193,481)
(1,204,548)
— $
—
—
—
—
—
(190,586)
(185,425)
The fair value of long-term debt including current maturities is estimated using market prices or indices for similar liabilities and taking into consideration other
factors such as credit quality and maturity, which are Level 3 inputs. The fair value of long-term debt, related party was estimated by discounting the future cash flows
based on current market conditions.
NOTE 8—LONG-TERM DEBT
Long-term debt consists of:
Term Loan, final payment due November 16, 2022
6.75% Senior Notes due December 15, 2022 (the "Match Group Senior Notes"); interest payable each June 15 and
December 15, which commences June 15, 2016
3.57% Notes (a)
5.00% Note (a)
5.90% Note (a)
Total long-term debt
Less: Current portion of long-term debt
Less: Net adjustment for remaining original issue discount on Term Loan and original issue premium related to the Match
Exchange Offer
Total long-term debt, net of current maturities
______________________
December 31,
2015
2014
(In thousands)
$
800,000 $
445,172
—
—
—
—
—
79,000
64,586
47,000
1,245,172
190,586
40,000
11,691
—
—
$
1,193,481 $
190,586
(a) These related party notes were paid off in full prior to our IPO. See Note 17 — Related Party Transactions.
On November 16, 2015, the Company completed a private exchange offer to eligible holders to exchange any and all of IAC's 4.75% Senior Notes due
December 15, 2022 (the "2012 Senior Notes"), for up to $500 million aggregate principal amount of Match Group Senior Notes issued by the Company (the "Match
Exchange Offer"). Match Group exchanged $445.3 million of IAC's 2012 Senior Notes for $445.2 million of Match Group Senior Notes pursuant to the Match
Exchange Offer. Prior to the IPO, the Company and certain of its domestic subsidiaries were guarantors of IAC’s 4.875% Senior Notes due November 30, 2018 (the
"2013 Senior Notes"), IAC's 2012 Senior Notes and IAC’s $300 million revolving credit facility (the "IAC Credit Facility"). Promptly following the closing of the
Match Exchange Offer, the Company and its subsidiaries were designated as unrestricted subsidiaries of IAC for purposes of the indentures governing IAC's 2013 and
2012 Senior Notes and IAC's Credit Facility. Following the designation, neither Match Group nor any of its subsidiaries guaranteed any debt of IAC, or are subject to
any of the covenants related to such debt.
The indenture governing the Match Group Senior Notes contains covenants that would limit the Company's ability to pay dividends or to make distributions and
repurchase or redeem Match Group stock in the event a default has occurred or Match Group is not in compliance with the maximum leverage ratio of 5.0 to 1.0. At
December 31, 2015, there were no limitations pursuant thereto. There are additional covenants that limit the ability of the Company and its subsidiaries to, among
other things, (i) incur indebtedness, make investments, or sell assets in the event the Company is not in compliance with the financial ratio set forth in the indenture,
and (ii) incur liens, enter into agreements restricting the ability of the Company's subsidiaries to pay dividends, enter into transactions with affiliates and consolidate,
merge or sell substantially all of their assets.
73
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
On October 7, 2015, the Company entered into a credit agreement (the "Match Group Credit Agreement"), which provides for a five -year $500 million
revolving credit facility (the "Match Group Credit Facility"). At December 31, 2015, there were no outstanding borrowings under the Match Group Credit Facility.
The annual commitment fee on undrawn funds is currently 35 basis points , and is based on the leverage ratio most recently reported. Borrowings under the Match
Group Credit Facility bear interest, at the Company's option, at a base rate or LIBOR, in each case plus an applicable margin, which is determined by reference to a
pricing grid based on the Company's consolidated net leverage ratio. The terms of the Match Group Credit Facility require the Company to maintain a leverage ratio
of not more than 5.0 to 1.0 and a minimum interest coverage ratio of not less than 2.5 to 1.0.
On November 16, 2015, the Company amended and restated the Match Group Credit Agreement to provide for an $800 million , seven -year term loan (the
"Term Loan"). Principal payments of $10 million under the Term Loan are due quarterly through maturity, at which point a final principal payment of $530 million
will become due. Additionally, the Term Loan may require additional annual principal payments as part of an excess cash flow sweep provision, the amount of which
is governed by the net secured leverage ratio. The Term Loan bears interest, at our option, at the base rate or LIBOR, plus 3.50% or 4.50% , respectively, with, in the
case of LIBOR, a floor of 1.00% . Interest payments are due no less than semi-annually through the term of the loan. The Term Loan and outstanding borrowings, if
any, under the Match Group Credit Facility rank pari-passu with each other, and have priority over the Match Group Senior Notes.
There are additional covenants under the Match Group Credit Facility and the Term Loan that limit the ability of the Company and its subsidiaries to, among
other things, incur indebtedness, pay dividends or make distributions. While the Term Loan remains outstanding, these same covenants under the Match Group Credit
Agreement are more restrictive than the covenants that are applicable to the Match Group Credit Facility. Obligations under the Match Group Credit Facility and
Term Loan are unconditionally guaranteed by certain Match Group wholly-owned domestic subsidiaries, and are also secured by the stock of certain Match Group
domestic and foreign subsidiaries.
At any time prior to December 15, 2017, the Match Group Senior Notes may be redeemed at a redemption price equal to the sum of the principal amount
thereof, plus accrued and unpaid interest and a make-whole premium. Thereafter, the Match Group Senior Notes may be redeemed at the redemption prices set forth
below, together with accrued and unpaid interest thereon to the applicable redemption date, if redeemed during the twelve-month period beginning on December 15 of
the years indicated below:
Year
2017
2018
2019
2020 and thereafter
Long-term debt maturities are as follows:
74
Percentage
102.375%
101.583%
100.792%
100.000%
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Years Ending December 31,
2016
2017
2018
2019
2020
2021
2022
Total
Less: Current portion of long-term debt
Less: Net adjustment for remaining original issue discount on Term Loan and original issue premium related to the Match Exchange Offer
Total long-term debt, net of current maturities
NOTE 9—SHAREHOLDERS' EQUITY
$
(In thousands)
40,000
40,000
40,000
40,000
40,000
40,000
1,005,172
1,245,172
40,000
11,691
$
1,193,481
Description of Common Stock, Class B Convertible Common Stock and Class C Common Stock
The rights of holders of Match Group common stock, Class B common stock and Class C common stock are identical, except for voting rights, conversion rights
and dividend rights. Holders of common stock are entitled to one vote per share on all matters to be voted upon by the stockholders. Holders of Class B common stock
are entitled to ten votes per share on all matters to be voted upon by stockholders. Holders of Class C common stock have no voting rights, except as otherwise
required by the laws of the State of Delaware, in which case holders of Class C common stock are entitled to one one-hundredth (1/100) of a vote per share. Holders
of the Company's common stock, Class B common stock and Class C common stock do not have cumulative voting rights in the election of directors.
Shares of Match Group's Class B common stock are convertible into shares of our common stock at the option of the holder at any time on a share for share
basis. Such conversion ratio will in all events be equitably preserved in the event of any recapitalization of Match Group by means of a stock dividend on, or a stock
split or combination of, our outstanding common stock or Class B common stock, or in the event of any merger, consolidation or other reorganization of Match Group
with another corporation. Upon the conversion of a share of our Class B common stock into a share of our common stock, the applicable share of Class B common
stock will be retired and will not be subject to reissue. Shares of common stock and Class C common stock have no conversion rights.
The holders of shares of Match Group common stock, Class B common stock and Class C common stock are entitled to receive, share for share, such dividends
as may be declared by Match Group's Board of Directors out of funds legally available therefore. In the event of a liquidation, dissolution or winding up, holders of
the Company's common stock, Class B common stock and Class C common stock are entitled to receive ratably the assets available for distribution to the stockholders
after payment of all liabilities and accrued but unpaid dividends and liquidation preferences on any outstanding preferred stock.
At December 31, 2015, IAC holds 209.9 million shares of our Class B common stock, representing 100% of our outstanding Class B common stock, 84.6% of
the ownership interest and 98.2% of the outstanding total voting power of the Company.
In the event that Match Group issues or proposes to issue any shares of Match Group common stock, Class B common stock or Class C common stock (with
certain limited exceptions), including shares issued upon the exercise, conversion or exchange of options, warrants and convertible securities, IAC will generally have
a purchase right that permits it to purchase for fair market value, as defined in the agreement, up to such number of shares of the same class as the issued shares as
would (i) enable IAC to maintain the same ownership interest in the Company that it had immediately prior to such issuance or proposed issuance, with respect to
issuances of our voting capital stock, or (ii) enable IAC to maintain ownership of at least 80.1% of each class of the Company's non‑voting capital stock, with respect
to issuances of our non‑voting capital stock.
75
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Reserved Common Shares
In connection with equity compensation plans, 70.1 million shares of Match Group common stock are reserved at December 31, 2015.
NOTE 10—ACCUMULATED OTHER COMPREHENSIVE LOSS
The following tables present the components of accumulated other comprehensive loss and items reclassified out of accumulated other comprehensive loss into
earnings:
Balance at January 1,
Other comprehensive (loss) income
Amounts reclassified to earnings
Net current period other comprehensive (loss) income
Balance at December 31,
Balance at January 1,
Other comprehensive loss
Balance at December 31,
Year Ended December 31, 2015
Foreign Currency
Translation
Adjustment
Unrealized (Loss) Gain
On Available-For-Sale
Security
Accumulated Other
Comprehensive Loss
(In thousands)
(76,800) $
(1,248) $
(60,793)
(2,191)
(62,984)
4,212
—
4,212
(78,048)
(56,581)
(2,191)
(58,772)
(139,784) $
2,964 $
(136,820)
Year Ended December 31, 2014
Foreign Currency
Translation
Adjustment
Unrealized Gain (Loss)
On Available-For-Sale
Security
Accumulated Other
Comprehensive Loss
(In thousands)
(17,090) $
(59,710)
(76,800) $
702 $
(1,950)
(1,248) $
(16,388)
(61,660)
(78,048)
$
$
$
$
At December 31, 2015 and 2014, there was no tax benefit or provision on the accumulated other comprehensive loss.
76
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
NOTE 11—EARNINGS PER SHARE
The following table sets forth the computation of the basic and diluted earnings per share attributable to Match Group shareholders:
Years Ended December 31,
2015
2014
2013
Basic
Diluted
Basic
Diluted
Basic
Diluted
(In thousands, except per share data)
$
$
120,487 $
120,487 $
148,359 $
148,359 $ 126,627 $
126,627
(104)
(104)
(595)
(595)
(1,624)
(1,624)
120,383 $
120,383 $
147,764 $
147,764 $ 125,003 $
125,003
Numerator
Net earnings
Net earnings attributable to noncontrolling interests
Net earnings attributable to Match Group, Inc. shareholders
Denominator
Basic weighted average common shares outstanding
174,784
174,784
160,756
160,756
159,509
159,509
Dilutive securities including subsidiary denominated equity, stock
options and RSU awards (a)(b)
—
10,150
—
7,323
—
5,792
Dilutive weighted average common shares outstanding
174,784
184,934
160,756
168,079
159,509
165,301
Earnings per share attributable to Match Group, Inc. shareholders
Earnings per share
$
0.69 $
0.65 $
0.92 $
0.88 $
0.78 $
0.76
________________________________
(a)
If the effect is dilutive, weighted average common shares outstanding include the incremental shares that would be issued upon the assumed exercise of subsidiary denominated equity,
stock options or restricted stock units ("RSUs"). For the years ended December 31, 2015 and 2013, 5.2 million and 0.2 million potentially dilutive securities, respectively, are excluded
from the calculation of diluted earnings per share because their inclusion would have been anti-dilutive. For the year ended 2014, all potentially dilutive securities were included in the
calculation of diluted earnings per share.
(b) Performance-based stock units ("PSUs") are included in the denominator for earnings per share if (i) the applicable performance condition(s) has been met and (ii) the inclusion of the
PSUs is dilutive for the respective reporting periods. For the year ended December 31, 2015, less than 0.1 million PSUs that were probable of vesting were excluded from the
calculation of diluted earnings per share because the performance conditions had not been met. For the year ended December 31, 2014 there were no outstanding PSUs. For the year
ended December 31, 2013, all PSUs that were considered to be probable of vesting were included in the calculation of diluted earnings per share as their performance conditions had
been met.
NOTE 12—STOCK-BASED COMPENSATION
The Company currently has one active stock and annual incentive plan, which became effective in 2015 upon the completion of the IPO. This plan replaces the
2009 and 2014 plans, which governed equity awards prior to the IPO. The 2015 plan covers stock options to acquire shares of Match Group common stock and RSUs,
as well as provide for the future grant of these and other equity awards. The 2015 plan authorizes the Company to grant awards to its employees, officers, directors
and consultants. At December 31, 2015 , there were 16.6 million shares available for grant under the 2015 plan.
The 2015 plan has a stated term of ten years, and provides that the exercise price of stock options granted will not be less than the market price of the Company's
common stock on the grant date. The plan does not specify grant dates or vesting schedules of awards as those determinations have been delegated to the
Compensation and Human Resources Committee of Match Group’s Board of Directors (the "Committee"). Each grant agreement reflects the vesting schedule for that
particular grant as determined by the Committee. Stock options granted subsequent to September 1, 2015 will generally vest in four equal
77
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
annual installments over a four -year period. RSU awards have not been granted in significant numbers; each award vests in accordance with its terms. No RSU award
has a vesting schedule of longer than four years.
Stock-based compensation expense recognized in the consolidated and combined statement of operations includes expense related to the Company's stock
options and RSUs, equity instruments denominated in shares of subsidiaries, and IAC denominated stock options, RSUs and PSUs held by Match Group employees.
The amount of stock-based compensation expense is reduced by estimated forfeitures, as the expense recorded is based on awards that are ultimately expected to vest.
The forfeiture rate is estimated at the grant date based on historical experience and revised, if necessary, in subsequent periods if actual forfeitures differ from the
estimated rate. At December 31, 2015 , there is $95.9 million of unrecognized compensation cost, net of estimated forfeitures, related to all equity-based awards,
which is expected to be recognized over a weighted average period of approximately 2.8 years.
The total income tax benefit recognized in the accompanying consolidated and combined statement of operations for the years ended December 31, 2015 , 2014
and 2013 related to stock-based compensation is $16.9 million , $7.9 million and $4.1 million , respectively.
Stock Options
Stock options outstanding at December 31, 2015 and changes during the year ended December 31, 2015 are as follows:
Outstanding at January 1, 2015 (a)
Granted
Exercised
Forfeited
Expired
Outstanding at December 31, 2015
Options exercisable
December 31, 2015
Weighted
Average
Exercise
Price
Weighted
Average
Remaining
Contractual
Term (In Years)
(Shares and intrinsic value in thousands)
Aggregate
Intrinsic
Value
9.59
13.90
7.70
12.35
—
12.08
8.85
8.1
5.4
$
$
65,456
47,266
Shares
16,912 $
21,091
(903)
(2,268)
—
34,832 $
10,061 $
__________________________________________________________
(a) Options outstanding and weighted average exercise price at January 1, 2015 have been adjusted to reflect the recapitalization of the Company’s equity that occurred prior to the
completion of the IPO and distributions made by the Company to IAC.
The aggregate intrinsic value in the table above represents the total pre-tax intrinsic value (the difference between Match Group's closing stock price on the last
trading day of 2015 and the exercise price of in-the-money options) that would have been received by the option holders had all option holders exercised their options
on December 31, 2015 ; this amount changes based on the fair market value of the Company's common stock. The total intrinsic value of stock options exercised
during the years ended December 31, 2015 , 2014 and 2013 is $5.7 million , $10.7 million and $34.7 million , respectively.
78
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
The following table summarizes the information about stock options outstanding and exercisable at December 31, 2015:
Range of Exercise Prices
$0.01 to $5.00
$5.01 to $10.00
$10.01 to $15.00
$15.01 to $20.00
Options Outstanding
Weighted-
Average
Remaining
Contractual
Life in Years
Outstanding at
December 31,
2015
Weighted-Average
Exercise
Price
Exercisable at
December 31,
2015
(Shares in thousands)
Options Exercisable
Weighted-
Average
Remaining
Contractual
Life in Years
Weighted-Average
Exercise
Price
925
4,966
23,897
5,044
34,832
4.1
3.5
8.8
9.7
8.1
$
$
4.11
7.68
12.59
15.44
12.08
925
4,602
4,534
—
10,061
4.1
3.4
7.6
—
5.4
$
$
4.11
7.63
11.06
—
8.85
The fair value of stock option awards, with the exception of market-based awards, is estimated on the grant date using the Black-Scholes option pricing model.
The Black-Scholes option pricing model incorporates various assumptions, including expected volatility and expected term. Prior to 2014, expected stock price
volatilities were estimated based on historical stock price volatilities of peer companies that were chosen on the basis for their similarity to the Company in terms of
consumer use, monetization model, margin and growth characteristics and brand strength. At the beginning of 2014, the Company concluded that the most relevant
reference point for determining volatility was IAC’s historical volatility as a result of the Company representing a large percentage of the overall value of IAC. The
risk-free interest rates are based on U.S. Treasuries with comparable terms as the awards, in effect at the grant date. Prior to the IPO expected term was based on the
mid-point of the first and last windows for exercise. Following the IPO, expected term is based upon the historical exercise pattern of IAC’s employees for
comparable awards, a ten years contractual life with vesting in four equal annual installments, because the Company does not have sufficient data to estimate an
expected term for these awards. No dividends have been assumed. The following are the weighted average assumptions used in the Black-Scholes option pricing
model:
Expected volatility
Risk-free interest rate
Expected term
Dividend yield
Years Ended December 31,
2015
2014
2013
28%
1.3%
29%
1.3%
4.1 years
4.2 years
—%
—%
41%
0.8%
4.2 years
—%
On November 18, 2015, the Company granted 1.8 million market-based stock options to its Chairman and Chief Executive Officer. This award only vests if the
price of Match Group common stock exceeds the relevant price threshold for a twenty -day consecutive period and the service requirement is met. The service
requirement will be met in four equal annual installments beginning on the first anniversary of the grant date. The grant date fair value of this market-based award is
estimated using a lattice model that incorporates a Monte Carlo simulation of Match Group's stock price. The inputs used to fair value this award includes expected
volatility of 27% , risk-free interest rate of 2.3% and a 0% dividend yield. The expected term of this award is derived from the output of the option valuation model.
Expense is recognized over the longer of the vesting period of each of the four installments or the derived service period. The derived service period of this award is 3
years .
Approximately 21.1 million , 5.6 million and 0.4 million stock options were granted by the Company during the years ended December 31, 2015 , 2014 and
2013 , respectively. The weighted average fair value of stock options granted during the years ended December 31, 2015 , 2014 and 2013 with exercise prices equal to
the market prices of Match Group's common stock on the date of grant are $3.46 , $5.21 and $4.98 , respectively. There were no stock options issued during the years
ended December 31, 2015 , 2014 and 2013 with exercise prices greater than the market value of Match Group's common stock on the date of grant.
79
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Cash received from stock option exercises and the related tax benefit realized for the period subsequent to the IPO through December 31, 2015 are $0.1 million
and less than $0.1 million , respectively. For periods prior to the IPO no cash was received from the exercise of stock options because they were net settled in shares
of IAC’s common stock. For the periods prior to the IPO the related tax benefit realized by the Company in 2015, 2014 and 2013 were $1.2 million , $1.7 million and
$4.2 million , respectively.
RSUs
RSUs are awards in the form of phantom shares or units denominated in a hypothetical equivalent number of shares of Match Group common stock and with the
value of each RSU equal to the fair value of Match Group common stock at the date of grant. Each RSU grant is subject to service-based vesting, where a specific
period of continued employment must pass before an award vests. The Company recognizes expense for all RSU grants, which is measured at the grant date as the fair
value of Match Group common stock and expensed as stock-based compensation over the vesting term.
Unvested RSUs outstanding at December 31, 2015 and changes during the year ended December 31, 2015 are as follows:
Unvested at January 1, 2015
Granted
Unvested at December 31, 2015
There were no RSUs granted or outstanding for the years ended December 31, 2014 and 2013 .
Equity Instruments Denominated in the Shares of Certain Subsidiaries
RSUs
Weighted
Average
Grant Date
Fair Value
Number
of shares
(Shares in thousands)
— $
489
489 $
—
13.92
13.92
Stock options and stock settled stock appreciation rights denominated in the equity of Tinder, The Princeton Review and OkCupid have been granted to certain
employees of these Match Group subsidiaries. These equity awards generally vest over a four-year period. The value of the stock options and stock settled stock
appreciation rights is tied to the value of the common stock of these subsidiaries. Accordingly, these interests only have value to the extent the relevant subsidiary
appreciates above the initial value utilized to determine the exercise price. These awards are granted with exercise prices of not less than the grant date fair value,
which is determined by the Company using a variety of valuation techniques including a combination of market based and discounted cash flow valuation
methodologies. The expense associated with these equity awards is initially measured at fair value, using the Black-Scholes option pricing model, at the grant date and
is recognized as stock-based compensation over the vesting term.
The plans under which these awards are granted establish specific settlement dates or liquidity events for which the valuation of the relevant subsidiary is
determined for purposes of settlement of the awards. The plans for OkCupid and The Princeton Review generally provide that Match Group establishes the fair value
of the awards; for Tinder, the settlement date fair value will be established by independent third parties or mutual agreement.
These subsidiary denominated awards, when exercised, are settled by Match Group issuing shares of its common stock equal in value to the intrinsic value of the
award being settled, net of shares with a value equal to the minimum withholding taxes due, which taxes are remitted by Match Group to the government on behalf of
the employees. At the time of settlement, IAC has the option to issue its own shares directly to the award holders, in which case Match Group would in turn issue its
shares to IAC as reimbursement. In either settlement scenario, the same number of Match Group shares would be issued. With respect to Tinder, Match Group has the
ability to extinguish its obligations to settle the Tinder awards if it completes an initial public offering of the stock of Tinder. In such an event, the Tinder denominated
equity would be exercisable for shares of Tinder common shares, rather than being settled in Match Group common shares.
The final settlement date for OkCupid awards occurred in February 2016. The Princeton Review has liquidity events on an annual basis. Tinder’s initial liquidity
event will occur sometime between May 2016 and May 2017, with subsequent events
80
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
occurring approximately every 18 months thereafter. The aggregate intrinsic value of all subsidiary denominated equity was $246.3 million and $226.8 million at
December 31, 2015 and 2014, respectively. The aggregate number of Match Group common shares that would have been required to settle these interests at estimated
fair values on December 31, 2015, including vested and unvested interests (and without giving effect to the withholding of shares to cover withholding taxes), is 18.2
million shares (the substantial majority of which relate to Tinder). The comparable amount at December 31, 2014 is 9.4 million shares. The number of shares
ultimately needed to settle these awards can vary from the estimated number as a result both of movements in our stock price and a determination of fair value of the
relevant subsidiary that is different than our estimate. Assuming no change in the value of the Company’s common stock, if the fair value of these subsidiaries were
10% higher or lower than the Company’s December 31, 2015 fair value estimate, the number of shares required to settle these awards would increase or decrease by
2.4 million shares. Assuming no change in the estimated fair value of these subsidiaries, if the Company’s stock price were 10% higher or lower the number of shares
required to settle these awards would decrease by 1.7 million shares and increase by 2.0 million shares, respectively.
During the third quarter of 2015, the Company modified certain subsidiary denominated vested equity awards and recognized a modification charge of $6.8
million . During the fourth quarter of 2015, the Company repurchased certain subsidiary denominated vested equity awards in exchange for $23.4 million in cash and
fully vested modified equity awards and recognized a modification charge of $7.7 million . These modification charges are included in stock-based compensation for
the year ended December 31, 2015.
During 2014, the Company granted to a non-employee an equity award denominated in shares of a subsidiary of the Company that is marked to market each
reporting period. The award has a vesting multiple times a year and is fully vested in 2017. At December 31, 2015, the total fair value of this award, at current
estimated fair value including vested and unvested interests, is $19.6 million .
IAC Denominated Stock Options
There were no IAC stock options granted by IAC to employees of Match Group for the years ended December 31, 2015 and 2014 . Approximately 0.1 million
IAC stock options were granted by IAC to employees of Match Group during the year ended December 31, 2013. The fair value of each stock option award is
estimated on the grant date using the Black–Scholes option pricing model. IAC stock options are granted with exercise prices at least equal to the fair value on the
date of grant, vest ratably in annual installments over a four year period and expire ten years from the date of grant.
In December 2013, IAC’s former Chief Executive Officer (the “Executive”) became Chairman of Match Group; in connection with the Executive’s
compensation arrangement, the Executive exercised 0.5 million IAC stock options, which were settled by IAC for $9.2 million in cash. In January 2014, a portion of
the Executive’s outstanding IAC stock options were canceled and replaced with equity denominated in a subsidiary of IAC and various subsidiaries of Match Group.
The incremental expense associated with this modification was $7.4 million .
IAC Denominated RSUs and PSUs
Approximately 0.7 million and 0.1 million IAC RSUs and PSUs were granted by IAC to employees of Match Group during the years ended December 31, 2015
and 2013 , respectively. There were no IAC RSUs or PSUs granted by IAC to employees of Match Group for the year ended December 31, 2014 . RSUs and PSUs are
awards in the form of phantom shares or units, denominated in a hypothetical equivalent number of shares of IAC common stock and with the value of each RSU and
PSU equal to the fair value of IAC common stock at the date of grant. Each RSU and PSU grant is subject to service-based vesting, where a specific period of
continued employment must pass before an award vests. PSUs also include performance-based vesting, where certain performance targets set at the time of grant must
be achieved before an award vests.
NOTE 13—SEGMENT INFORMATION
The Company has two operating segments, Dating and Non-dating, which are also the Company's two reportable segments. The Company’s Chairman, who is
the chief operating decision maker, allocates resources and assesses performance at the segment level. Our Dating segment provides dating products and the
Company’s Non–dating segment provides a variety of education services including test preparation, academic tutoring and college counseling services.
81
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Revenue:
Dating
Non-dating
Total
Operating Income (Loss):
Dating
Non-dating
Total
Adjusted EBITDA: (a)
Dating
Non-dating
Total
Segment Assets: (b)
Dating
Non-dating
Total
Capital expenditures:
Dating
Non-dating
Total
Years Ended December 31,
2015
2014
(In thousands)
2013
909,705 $
110,726
1,020,431 $
836,458 $
51,810
888,268 $
788,197
14,892
803,089
Years Ended December 31,
2015
2014
(In thousands)
2013
212,981 $
(19,425)
193,556 $
253,725 $
(25,158)
228,567 $
230,273
(8,940)
221,333
Years Ended December 31,
2015
2014
(In thousands)
2013
284,554 $
(5,887)
278,667 $
289,287 $
(15,839)
273,448 $
277,463
(6,232)
271,231
December 31,
2015
2014
(In thousands)
$
$
318,062 $
38,757
356,819 $
271,335
29,398
300,733
Years Ended December 31,
2015
2014
(In thousands)
2013
25,246 $
3,910
29,156 $
19,734 $
2,059
21,793 $
19,587
220
19,807
$
$
$
$
$
$
$
$
______________________________________________________________________________
(a) The Company's primary financial measure is Adjusted EBITDA, which is defined as operating income excluding: (1) stock-based compensation expense; (2) depreciation; and (3)
acquisition-related items consisting of (i) amortization of intangible assets and impairments of goodwill and intangible assets and (ii) gains and losses recognized on changes in the fair
value of contingent consideration arrangements. The Company believes this measure is useful for analysts and investors as this measure allows a more meaningful comparison between
our performance and that of our competitors. Moreover, our management uses this measure internally to evaluate the performance of our business as a whole and our individual business
segments. The above items are excluded from our Adjusted EBITDA measure because these items are non-cash in nature, and we believe that by excluding these items, Adjusted
EBITDA corresponds more closely to the cash operating income generated from our business, from which capital investments are made and debt is serviced. Adjusted EBITDA has
certain limitations in that it does not take into account the impact to Match Group's statement of operations of certain expenses.
82
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
(b) Consistent with the Company's primary metric (described in (a) above), the Company excludes goodwill and intangible assets from the measure of segment assets presented above.
Revenue by geography is based on where the customer is located. Geographic information about revenue and long-lived assets is presented below:
Revenue
United States
All other countries
Total
Years Ended December 31,
2015
2014
(In thousands)
2013
$
$
695,149 $
325,282
1,020,431 $
578,139 $
310,129
888,268 $
516,589
286,500
803,089
The United States is the only country whose revenue is greater than 10 percent of total revenue for the year ended December 31, 2015 and 2014. The only
country, other than the United States, with greater than 10 percent of total revenue for the year ended December 31, 2013, was France with revenue of $81.4 million .
Long-lived assets (excluding goodwill and intangible assets)
United States
All other countries
Total
December 31,
2015
2014
(In thousands)
$
$
28,169 $
19,898
48,067 $
25,436
17,561
42,997
The only country, other than the United States, with greater than 10 percent of total long-lived assets (excluding goodwill and intangible assets), was France
with $14.5 million as of both December 31, 2015 and 2014.
The following tables reconcile Adjusted EBITDA to operating income (loss) for the Company's reportable segments and to net earnings attributable to Match
Group, Inc. shareholders:
83
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Year Ended December 31, 2015
Adjusted EBITDA
Stock-based
compensation
Depreciation
Amortization
of Intangibles
(In thousands)
Acquisition-related
Contingent
Consideration Fair
Value Adjustments
Operating
Income
(Loss)
$
$
284,554 $
(49,401) $
(19,791) $
(13,437) $
11,056 $
(5,887)
(682)
(6,192)
(6,664)
—
278,667 $
(50,083) $
(25,983) $
(20,101) $
11,056
Dating
Non-dating
Total
Interest expense—third party
Interest expense—related party
Other income, net
Earnings before income taxes
Income tax provision
Net earnings
Net earnings attributable to noncontrolling interests
Net earnings attributable to Match Group, Inc. shareholders
Year Ended December 31, 2014
Adjusted EBITDA
Stock-based
compensation
Depreciation
Amortization
of Intangibles
(In thousands)
$
120,383
Acquisition-related
Contingent
Consideration Fair
Value Adjustments
Operating
Income
(Loss)
$
$
289,287 $
(19,543) $
(21,502) $
(15,839)
(1,308)
(4,045)
(7,429) $
(3,966)
12,912 $
—
273,448 $
(20,851) $
(25,547) $
(11,395) $
12,912
Dating
Non-dating
Total
Interest expense—third party
Interest expense—related party
Other income, net
Earnings before income taxes
Income tax provision
Net earnings
212,981
(19,425)
193,556
(18,049)
(8,009)
11,887
179,385
(58,898)
120,487
(104)
253,725
(25,158)
228,567
—
(25,541)
12,610
215,636
(67,277)
148,359
(595)
Net earnings attributable to noncontrolling interests
Net earnings attributable to Match Group, Inc. shareholders
84
$
147,764
(8,940)
221,333
—
(34,307)
217
187,243
(60,616)
126,627
(1,624)
125,003
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Year Ended December 31, 2013
Adjusted EBITDA
Stock-based
compensation
Depreciation
Amortization
of Intangibles
(In thousands)
Acquisition-related
Contingent
Consideration Fair
Value Adjustments
Operating
Income
(Loss)
277,463 $
(11,718) $
(19,991) $
(15,138) $
(343)
$
230,273
(6,232)
(510)
(211)
(1,987)
271,231 $
(12,228) $
(20,202) $
(17,125) $
—
(343)
$
$
Dating
Non-dating
Total
Interest expense—third party
Interest expense—related party
Other income, net
Earnings before income taxes
Income tax provision
Net earnings
Net earnings attributable to noncontrolling interests
Net earnings attributable to Match Group, Inc. shareholders
The following tables reconcile segment assets to total assets:
$
Dating
Non-dating
Total
Dating
Non-dating
Total
Segment Assets
Goodwill
December 31, 2015
Indefinite-Lived
Intangible Assets
(In thousands)
Definite-Lived
Intangible Assets
Total Assets
318,062 $
1,218,380 $
38,757
74,395
356,819 $
1,292,775 $
219,797 $
23,900
243,697 $
19,026 $
13,685
32,711 $
1,775,265
150,737
1,926,002
Segment Assets
Goodwill
December 31, 2014
Indefinite-Lived
Intangible Assets
(In thousands)
Definite-Lived
Intangible Assets
Total Assets
271,335 $
718,129 $
29,398
75,634
156,658
23,900
300,733 $
793,763 $
180,558 $
6,706 $
20,349
27,055 $
1,152,828
149,281
1,302,109
$
$
$
$
NOTE 14—COMMITMENTS
The Company leases office space, data center facilities and equipment used in connection with its operations under various operating leases, many of which
contain escalation clauses. In addition, future minimum lease payments include Match Group's allocable share of an IAC data center lease.
85
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Future minimum payments under operating lease agreements are as follows:
2016
2017
2018
2019
2020
Thereafter
Total
(In thousands)
9,788
10,583
8,917
5,359
4,589
19,621
58,857
$
$
Expenses charged to operations under these agreements are $13.9 million , $14.7 million and $10.9 million for the years ended December 31, 2015 , 2014 and
2013, respectively. See Note 17 for additional information related to related party transactions.
The Company also has $0.3 million in funding commitments in the form of surety bonds that expire within twelve months of December 31, 2015.
NOTE 15—CONTINGENCIES
In the ordinary course of business, the Company is a party to various lawsuits. The Company establishes reserves for specific legal matters when it determines
that the likelihood of an unfavorable outcome is probable and the loss is reasonably estimable. Management has also identified certain other legal matters where we
believe an unfavorable outcome is not probable and, therefore, no reserve is established. Although management currently believes that resolving claims against us,
including claims where an unfavorable outcome is reasonably possible, will not have a material impact on the liquidity, results of operations, or financial condition of
the Company, these matters are subject to inherent uncertainties and management's view of these matters may change in the future. The Company also evaluates other
contingent matters, including income and non-income tax contingencies, to assess the likelihood of an unfavorable outcome and estimated extent of potential loss. It is
possible that an unfavorable outcome of one or more of these lawsuits or other contingencies could have a material impact on the liquidity, results of operations, or
financial condition of the Company. See Note 3 for additional information related to income tax contingencies.
NOTE 16—SUPPLEMENTAL CASH FLOW INFORMATION
Supplemental Disclosure of Non-Cash Transactions:
The Company recorded acquisition-related contingent consideration liabilities of $27.4 million , $0.3 million and $40.8 million during the years ended
December 31, 2015, 2014 and 2013, respectively. See Note 7 for additional information on contingent consideration arrangements.
On November 16, 2015, the Company exchanged $445.3 million of IAC 2012 Senior Notes for $445.2 million of Match Group Senior Notes. See Note 8 for
additional information on this note exchange.
86
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Supplemental Disclosure of Cash Flow Information:
Cash paid (received) during the year for:
Interest
Income tax payments, including amounts paid to IAC for Match Group's share of IAC's
consolidated tax liability
Income tax refunds
NOTE 17 —RELATED PARTY TRANSACTIONS
Years Ended December 31,
2015
2014
(In thousands)
2013
$
8,696 $
7,017 $
2,928
46,657
(1,583)
68,905
(3,826)
60,107
(647)
For periods prior to the IPO, the Company's consolidated and combined statement of operations includes allocations of general and administrative costs,
including stock-based compensation expense, related to IAC's accounting, treasury, legal, tax, corporate support and internal audit functions. These allocations were
based on Match Group's revenue as a percentage of IAC's total revenue. Allocated general and administrative costs, inclusive of stock-based compensation expense,
were $6.9 million , $6.6 million , and $6.2 million in the years ended December 31, 2015 , 2014 and 2013, respectively, and are included in "General and
administrative expense" in the accompanying consolidated and combined statement of operations. It is not practicable to determine the actual expenses that would
have been incurred for these services had the Company operated as a stand-alone entity. Management considers the allocation method to be reasonable. For the period
from the date of the IPO through December 31, 2015, the Company was charged $0.7 million by IAC for services rendered pursuant to the services agreement
described below. This amount was paid in full by the Company at December 31, 2015.
The Company has entered into certain arrangements with IAC in the ordinary course of business for: (i) the leasing of office space for certain of our businesses
at properties owned by IAC, for which we paid IAC approximately $1.7 million , $1.0 million and $0.5 million in the years ended December 31, 2015, 2014 and 2013,
respectively; and (ii) the subleasing of space in a data center from an IAC subsidiary, for which we paid such IAC subsidiary approximately $1.2 million in each of
the years ended December 31, 2015, 2014 and 2013.
The portion of interest income reflected in the consolidated and combined statement of operations that is intercompany in nature was $3.8 million , $2.1 million ,
and $1.2 million for the years ended December 31, 2015 , 2014 and 2013, respectively.
The following summarizes the components of the net (increase)/decrease in IAC's investment in the Match Group prior to the IPO for the years ended December
31, 2015, 2014, and 2013:
Capital contribution from IAC to partially fund the acquisition of PlentyOfFish
$
(155,000) $
— $
—
Cash transfers to IAC related to its centrally managed U.S. treasury management function, acquisitions and cash
expenses paid by IAC on behalf of Match Group, net
Taxes
Interest income (expense), net (a)
Allocation of general and administrative expense
126,275
(57,041)
3,813
(6,898)
165,782
(54,761)
(12,936)
(6,648)
Net (increase) decrease in IAC's investment in the Match Group
$
(88,851) $
91,437 $
59,216
(54,228)
(29,737)
(6,210)
(30,959)
December 31,
2015
2014
2013
(In thousands)
_______________________________
(a) Does not include long-term debt, related party.
87
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Related Party Debt
The related party notes described below were repaid in full prior to the IPO.
On September 28, 2011, the Company, through a foreign subsidiary, Match.com Europe Limited, issued $94 million aggregate principal amount of 3.57%
Notes. The notes were issued to three IAC foreign subsidiaries in connection with the financing of the acquisition of a controlling interest in Meetic in September
2011. In December 2011, the Company repaid $15 million leaving an outstanding balance of $79 million . The remaining notes were guaranteed by Match.com
Pegasus Limited, a subsidiary of the Company.
On April 8, 2014, Match.com Europe Limited and Match.com France Limited issued a €53 million 5.00% Note and a $47 million 5.90% Note, respectively. The
5.00% euro denominated note was issued to an IAC foreign subsidiary in connection with the financing of the purchase of the remaining publicly-traded shares of
Meetic that took place in the first quarter of 2014. The 5.90% Note was issued to an IAC foreign subsidiary with the proceeds being used to repay certain indebtedness
that had been created in order to partially fund the acquisition of shares in Meetic.
Dividend to IAC
During the fourth quarter of 2015, the Company made a dividend to IAC in the amount of $1.5 billion , of which $1.0 billion was paid in cash and $445.3
million was assumed in the Match Exchange Offer. See Note 8 for additional information on this note exchange.
Relationship with IAC post IPO
In connection with the IPO, the Company entered into certain agreements relating to our relationship with IAC after the IPO. These agreements include a master
transaction agreement; an investor rights agreement; a tax sharing agreement; a services agreement; an employee matters agreement and a subordinated loan
agreement.
Master Transaction Agreement
The master transaction agreement sets forth the agreements between IAC and the Company regarding the principal transactions necessary to separate our
business from IAC, as well as govern certain aspects of our relationship with IAC after the completion of the IPO. Under the master transaction agreement the
Company agrees to assume all of the assets and liabilities related to its business and agrees to indemnify IAC against any losses arising out of any breach by the
Company of the master transaction agreement or the other transaction related agreements described below. IAC also agrees to indemnify the Company against losses
arising out of any breach by IAC of the master transaction agreement or any of the other transaction related agreements.
Investor Rights Agreement
Under the investor rights agreement the Company will provide IAC with (i) specified registration and other rights relating to its shares of our common stock and
(ii) anti-dilution rights. See Note 9 for additional information on the anti-dilution rights.
Tax Sharing Agreement
The tax sharing agreement will govern the rights, responsibilities, and obligations of the Company and IAC with respect to tax liabilities and benefits,
entitlements to refunds, preparation of tax returns, tax contests and other tax matters regarding U.S. federal, state, local and foreign income taxes. Under the tax
sharing agreement, the Company is generally responsible and required to indemnify IAC for: (i) all taxes imposed with respect to any consolidated, combined or
unitary tax return of IAC or one of its subsidiaries that includes the Company or any of our subsidiaries to the extent attributable to the Company or any of our
subsidiaries, as determined under the tax sharing agreement, and (ii) all taxes imposed with respect to any of the Company's subsidiaries’ consolidated, combined,
unitary or separate tax returns.
88
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Services Agreement
The services agreement will govern services that the Company expects that IAC will provide including, among others: (i) assistance with certain legal, finance,
internal audit, treasury, information technology support, insurance and tax affairs, including assistance with certain public company reporting obligations; (ii) payroll
processing services; (iii) tax compliance services; and (iv) such other services as to which IAC and the Company may agree. In addition, under the services agreement
the Company will provide IAC informational technology services and such other services as to which IAC and the Company may agree. The services agreement will
continue for one year from the date of the IPO, with automatic renewal, subject to IAC’s continued ownership of a majority of the combined voting power of the
Company's voting stock.
Employee Matters Agreement
The employee matters agreement covers a wide range of compensation and benefit issues related to the allocation of liabilities associated with: (i) employment
or termination of employment, (ii) employee benefit plans and (iii) equity awards. Under the employee matters agreement, the Company's employees will continue to
participate in IAC’s U.S. health and welfare plans, 401(k) plan and flexible benefits plan and the Company will reimburse IAC for the costs of such participation. In
the event IAC no longer retains shares representing at least 80% of the aggregate voting power of shares entitled to vote in the election of the Company’s Board of
Directors, Match Group will no longer participate in IAC’s employee benefit plans, but will establish its own employee benefit plans that will be substantially similar
to the plans sponsored by IAC.
The employee matters agreement also provides that (i) the Company will reimburse IAC for the cost of any IAC equity awards held by Match Group’s
employees and former employees and that IAC may elect to receive payment either in cash or the Company common stock. With respect to equity awards in certain of
the Company's subsidiaries, IAC may require those awards to be settled in either shares of IAC’s common stock or in shares of the Company's common stock and, to
the extent shares of IAC common stock are issued in settlement, the Company will reimburse IAC for the cost of those shares by issuing to IAC additional shares of
the Company's common stock.
IAC Subordinated Loan Facility
Prior to the IPO, the Company entered into an uncommitted subordinated loan facility with IAC (the "IAC Subordinated Loan Facility"), which allows the
Company to make one or more requests to IAC to borrow funds from it. If IAC agrees to fulfill any such borrowing request from the Company, such indebtedness will
be incurred in accordance with the terms of the IAC Subordinated Loan Facility. Any indebtedness outstanding under the IAC Subordinated Loan Facility will be by
its terms subordinated in right of payment to the obligations under the Match Group Credit Agreement and the Match Group Senior Notes, and will bear interest at the
applicable rate set forth in the pricing grid in the Match Group Credit Agreement, which rate is based on the Company's consolidated net leverage ratio at the time of
borrowing, plus an additional amount to be agreed upon. The IAC Subordinated Loan Facility has a scheduled final maturity date of no earlier than 90 days after the
maturity date of the Match Group Credit Facility or the latest maturity date in respect of any class of Term Loans outstanding under the Match Group Credit
Agreement. At December 31, 2015, the Company has no indebtedness outstanding under the IAC Subordinated Loan Facility.
NOTE 18—BENEFIT PLANS
Match Group employees are eligible to participate in a retirement savings plan sponsored by IAC in the United States which is qualified under Section 401(k) of
the Internal Revenue Code. Under the IAC/InterActiveCorp Retirement Savings Plan (the "Plan"), participating employees may contribute up to 50% of their pre-tax
earnings, but not more than statutory limits. The employer match under the Plan is fifty cents for each dollar a participant contributes in this Plan, with a maximum
contribution of 3% of a participant's eligible earnings, but not more than statutory limits. Matching contributions are invested in the same manner as each participant’s
voluntary contributions in the investment options provided under the Plan. An investment option in the Plan is IAC common stock, but neither participant nor
matching contributions are required to be invested in IAC common stock. Matching contributions under the Plan for the years ended December 31, 2015 , 2014 , and
2013 were $2.1 million , $1.6 million and $1.2 million , respectively. The increase in matching contributions in 2015 is due primarily to an increase in participation in
the Plan due to recent acquisitions and increased headcount.
89
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
Internationally, Match Group also has or participates in various benefit plans, primarily defined contribution plans. Match Group's contributions for these plans
for the years ended December 31, 2015 , 2014 and 2013 were $2.0 million , $2.1 million , and $2.3 million , respectively.
NOTE 19—STREAMLINING OF TECHNOLOGY SYSTEMS AND CONSOLIDATION OF EUROPEAN OPERATIONS
Match Group is currently in the process of rebuilding its underlying Dating technology infrastructure that supports both its mobile and desktop platforms, as
well as consolidating its European operations from seven principal locations down to three . For the year ended December 31, 2015, Match Group incurred $16.8
million in costs related to this project. A summary of the costs incurred, payments made and the related accruals is presented below.
Accrual as of January 1,
Charges incurred
Payments made
Accrual as of December 31,
The costs are allocated as follows in the statement of operations:
Cost of revenue
Selling and marketing expense
General and administrative expense
Product development expense
Total
90
Severance
$
$
795 $
8,350
(6,132)
3,013 $
December 31, 2015
Professional Fees &
Other
(In thousands)
933
$
8,417
(8,786)
564
$
Total
1,728
16,767
(14,918)
3,577
Year Ended December 31,
2015
(In thousands)
$
$
2,947
1,678
8,160
3,982
16,767
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
NOTE 20—CONSOLIDATED AND COMBINED FINANCIAL STATEMENT DETAILS
Other current assets:
Prepaid expenses
Other
Other current assets
Property and equipment, net:
Computer equipment and capitalized software
Leasehold improvements
Furniture and other equipment
Projects in progress
Accumulated depreciation and amortization
Property and equipment, net
Accrued expenses and other current liabilities:
Accrued employee compensation and benefits
Accrued advertising expense
Other
Accrued expenses and other current liabilities
December 31,
2015
2014
(In thousands)
18,983 $
20,066
39,049 $
17,740
10,072
27,812
December 31,
2015
2014
(In thousands)
100,325 $
11,342
4,040
3,004
118,711
(70,644)
48,067 $
86,716
9,624
3,441
1,375
101,156
(58,159)
42,997
December 31,
2015
2014
(In thousands)
30,012 $
23,201
65,343
118,556 $
28,791
18,187
47,741
94,719
$
$
$
$
$
$
Other income (expense), net:
Foreign currency exchange gain related to Euro denominated long-term debt—related party
Interest income
Foreign currency exchange gains (losses), net
Other
Other income, net
91
Years Ended December 31,
2015
2014
(In thousands)
2013
$
$
7,558 $
8,307 $
4,715
2,387
(2,773)
2,898
2,583
(1,178)
11,887 $
12,610 $
—
1,943
(1,737)
11
217
MATCH GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS (Continued)
NOTE 21—QUARTERLY RESULTS (UNAUDITED)
Year Ended December 31, 2015
Revenue
Cost of revenue
Operating income
Net earnings
Net earnings attributable to the Match Group, Inc. shareholders
Per share information attributable to the Match Group, Inc. shareholders:
Basic
Diluted
Year Ended December 31, 2014
Revenue
Cost of revenue
Operating income
Net earnings
$
$
$
Net earnings attributable to the Match Group, Inc. shareholders
Per share information attributable to the Match Group, Inc. shareholders:
Quarter Ended
March 31
Quarter Ended
June 30
Quarter Ended
September 30
Quarter Ended
December 31
(In thousands, except per share data)
$
235,069 $
248,817 $
268,971 $
267,574
38,953
27,040
25,880
26,206
44,529
40,522
23,431
23,325
47,636
58,356
35,437
35,259
0.16 $
0.16 $
0.14 $
0.14 $
0.21 $
0.20 $
46,870
67,638
35,739
35,593
0.17
0.16
209,785 $
211,906 $
227,581 $
238,996
24,145
40,696
19,848
19,718
24,487
57,465
29,102
28,925
33,447
62,868
51,059
50,844
37,945
67,538
48,350
48,277
0.30
0.29
Basic
Diluted
$
$
0.12 $
0.12 $
0.18 $
0.17 $
0.32 $
0.30 $
92
Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
Not applicable.
Item 9A. Controls and Procedures
Conclusion Regarding the Effectiveness of the Company's Disclosure Controls and Procedures
The Company monitors and evaluates on an ongoing basis its disclosure controls and procedures in order to improve their overall effectiveness. In the course of
these evaluations, the Company modifies and refines its internal processes as conditions warrant.
As required by Rule 13a-15(b) of the Exchange Act, Match Group management, including the Chairman and Chief Executive Officer ("CEO") and the Chief
Financial Officer ("CFO"), conducted an evaluation, as of the end of the period covered by this report, of the effectiveness of the Company's disclosure controls and
procedures as defined in Exchange Act Rule 13a-15(e). Based on this evaluation, the CEO and the CFO concluded that the Company's disclosure controls and
procedures were effective as of the end of the period covered by this report.
Management's Report on Internal Control Over Financial Reporting
Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) and
15d-15(f) under the Exchange Act) for the Company. The Company's internal control over financial reporting is a process designed to provide reasonable assurance
regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally
accepted in the United States.
Internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail,
completely, accurately and fairly reflect the transactions and dispositions of the Company’s assets; (ii) provide reasonable assurance that transactions are recorded as
necessary to permit preparation of the financial statements in accordance with accounting principles generally accepted in the United States of America; (iii) provide
reasonable assurance that Company receipts and expenditures are made only in accordance with the authorization of management and the directors of the Company,
and (iv) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material
effect on the Consolidated and Combined Financial Statements. Internal control over financial reporting includes the controls themselves, monitoring and internal
auditing practices and actions taken to correct deficiencies as identified.
This annual report does not include a report of management’s assessment regarding internal control over financial reporting or an attestation report of the
Company’s registered public accounting firm due to a transition period established by rules of the Securities and Exchange Commission ("SEC") for newly public
companies. Under the rules and regulations of the SEC, we are not required to comply with the requirements of Section 404 of the Sarbanes Oxley Act of 2002 until
we file our annual report on Form 10-K for the year ending December 31, 2016.
The Company’s management, including the CEO and the CFO, does not expect that our internal controls over financial reporting, because of inherent
limitations, will prevent or detect all errors and all fraud. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may
be inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate
Changes in Internal Control Over Financial Reporting
There have been no changes in our internal control over financial reporting during the quarter ended December 31, 2015 that have materially affected or are
reasonably likely to materially affect the Company’s internal control over financial reporting.
Item 9B. Other Information
Not applicable.
93
PART III
The information required by Part III (Items 10, 11, 12, 13 and 14) has been incorporated by reference to Match Group's definitive Proxy Statement to be used in
connection with its 2016 Annual Meeting of Stockholders (the "2016 Proxy Statement"), as set forth below in accordance with General Instruction G(3) of Form 10-
K.
Item 10. Directors, Executive Officers and Corporate Governance
The information required by Items 401 and 405 of Regulation S-K relating to directors and executive officers of Match Group and their compliance with Section
16(a) of the Exchange Act is set forth in the sections entitled "Information Concerning Director Nominees" and "Information Concerning Match Group Executive
Officers Who Are Not Directors" and "Section 16(a) Beneficial Ownership Reporting Compliance," respectively, in the 2016 Proxy Statement and is incorporated
herein by reference. The information required by Item 406 of Regulation S-K relating to Match Group's Code of Ethics is set forth under the caption "Part I-Item 1-
Business-Additional information-Code of ethics" of this annual report and is incorporated herein by reference. The information required by subsections (c)(3), (d)(4)
and (d)(5) of Item 407 of Regulation S-K is set forth in the sections entitled "Corporate Governance" and "The Board and Board Committees" in the 2016 Proxy
Statement and is incorporated herein by reference.
Item 11. Executive Compensation
The information required by Item 402 of Regulation S-K relating to executive and director compensation is set forth in the sections entitled "Executive
Compensation" and "Director Compensation" in the 2016 Proxy Statement and is incorporated herein by reference. The information required by subsections (e)(4) and
(e)(5) of Item 407 of Regulation S-K relating to certain compensation committee matters is set forth in the sections entitled "The Board and Board Committees,"
"Compensation Committee Report" and "Compensation Committee Interlocks and Insider Participation" in the 2016 Proxy Statement and is incorporated herein by
reference; provided, that the information set forth in the section entitled "Compensation Committee Report" shall be deemed furnished herein and shall not be deemed
incorporated by reference into any filing under the Securities Act or the Exchange Act.
Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
The information regarding ownership of Match Group common stock and Class B common stock required by Item 403 of Regulation S-K and securities
authorized for issuance under Match Group's various equity compensation plans required by Item 201(d) of Regulation S-K is set forth in the sections entitled
"Security Ownership of Certain Beneficial Owners and Management" and "Equity Compensation Plan Information," respectively, in the 2016 Proxy Statement and is
incorporated herein by reference.
Item 13. Certain Relationships and Related Transactions, and Director Independence
Information regarding certain relationships and related transactions involving Match Group required by Item 404 of Regulation S-K and director independence
required by Item 407(a) of Regulation S-K is set forth in the sections entitled "Certain Relationships and Related Person Transactions" and "Corporate Governance,"
respectively, in the 2016 Proxy Statement and is incorporated herein by reference.
Item 14. Principal Accounting Fees and Services
Information required by Item 9(e) of Schedule 14A regarding the fees and services of Match Group's independent registered public accounting firm and the pre-
approval policies and procedures applicable to services provided to Match Group by such firm is set forth in the sections entitled "Fees Paid to Our Independent
Registered Public Accounting Firm" and "Audit and Non-Audit Services Pre-Approval Policy," respectively, in the 2016 Proxy Statement and is incorporated herein
by reference.
PART IV
Item 15. Exhibits and Financial Statement Schedules
(a) List of documents filed as part of this Report:
(1) Consolidated and Combined Financial Statements of Match Group, Inc.
Report of Independent Registered Public Accounting Firm: Ernst & Young LLP.
94
Consolidated and Combined Balance Sheet as of December 31, 2015 and 2014.
Consolidated and Combined Statement of Operations for the Years Ended December 31, 2015, 2014 and 2013.
Consolidated and Combined Statement of Comprehensive Income for the Years Ended December 31, 2015, 2014 and 2013.
Consolidated and Combined Statement of Shareholders' Equity for the Years Ended December 31, 2015, 2014 and 2013.
Consolidated and Combined Statement of Cash Flows for the Years Ended December 31, 2015, 2014 and 2013.
Notes to Consolidated and Combined Financial Statements.
(2) Consolidated and Combined Financial Statement Schedule of Match Group, Inc.
Schedule
Number
II
Valuation and Qualifying Accounts.
All other financial statements and schedules not listed have been omitted since the required information is either included in the Consolidated and Combined
Financial Statements or the notes thereto, is not applicable or is not required.
95
The documents set forth below, numbered in accordance with Item 601 of Regulation S-K, are filed herewith, incorporated by reference herein by reference to the
location indicated or furnished herewith.
EXHIBIT INDEX
Exhibit No.
Description
Location
2.1
3.1
3.2
4.1
4.2
4.3
10.1
10.2
10.3
10.4
Stock Purchase Agreement, dated as of July 13, 2015, by and among
Match.com Inc., Plentyoffish Media Inc., Markus Frind, Markus Frind Family
Trust No. 2, and Frind Enterprises Ltd.
Exhibit 2.1 to the Registrant's Registration Statement on Form S-1,
filed on October 16, 2015.
Amended and Restated Certificate of Incorporation of
Match Group, Inc.
Amended and Restated By-laws of Match Group, Inc.
Exhibit 3.1 to the Registrant’s Current Report on Form 8-K, filed
on November 24, 2015.
Exhibit 3.2 to the Registrant’s Current Report on Form 8-K, filed
on November 24, 2015.
Indenture, dated November 16, 2015, between Match Group, Inc. and
Computershare Trust Company, N.A., as Trustee.(1)
Registration Rights Agreement, dated November 16, 2015, among Match
Group, Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and the other
Dealer Managers party thereto.(1)
Investor Rights Agreement, dated as of November 24, 2015, by and between
Match Group, Inc. and IAC/InterActiveCorp.
Exhibit 4.3 to the Registrant’s Current Report on Form 8-K, filed
on November 24, 2015.
Master Transaction Agreement, dated as of November 24, 2015, by and
between Match Group, Inc. and IAC/InterActiveCorp.
Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, filed
on November 24, 2015.
Employee Matters Agreement, dated as of November 24, 2015, by and
between Match Group, Inc. and IAC/InterActiveCorp.
Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, filed
on November 24, 2015.
Tax Sharing Agreement, dated as of November 24, 2015, by and between
Match Group, Inc. and IAC/InterActiveCorp.
Exhibit 10.3 to the Registrant’s Current Report on Form 8-K, filed
on November 24, 2015.
Services Agreement, dated as of November 24, 2015, by and between Match
Group, Inc. and IAC/InterActiveCorp.
Exhibit 10.4 to the Registrant’s Current Report on Form 8-K, filed
on November 24, 2015.
10.5
Match Group, Inc. 2015 Stock and Annual Incentive Plan.(2)
Exhibit 10.5 to the Registrant’s Current Report on Form 8-K, filed
on November 24, 2015.
10.6
10.7
Form of Notice and Terms and Conditions for Stock Options granted under the
Match Group, Inc. 2015 Stock and Annual Incentive Plan.(2)
Exhibit 10.26 to the Amendment No. 3 to the Registrant’s
Registration Statement on Form 2-1, filed on November 16, 2016.
Form of Notice and Terms and Conditions for Restricted Stock Units granted
under the Match Group, Inc. 2015 Stock and Annual Incentive Plan.(2)
Exhibit 10.27 to the Amendment No. 3 to the Registrant’s
Registration Statement on Form 2-1, filed on November 16, 2016.
10.8
Tutor .com, Inc. 2013 Incentive Plan.(2)
Exhibit 10.28 to Amendment No. 3 to the Registrant's Registration
Statement on Form S-1, filed on November 16, 2015.
10.9 Summary of Non-Employee Director Compensation Arrangements. (1)(2)
10.10
10.11
Incremental Assumption Agreement and Amendment No. 1, dated as of
November 16, 2015, among Match Group, Inc. and certain subsidiaries
thereof, JPMorgan Chase Bank, N.A., as Term B-1 Lender, JPMorgan Chase
Bank, N.A., as Administrative Agent and Lender, and the other Lenders party
thereto.(1)(3)
Amended and Restated Credit Agreement, dated as of November 16, 2015,
among Match Group, Inc., as Borrower, the Lenders party thereto, JPMorgan
Chase Bank, N.A., as Administrative Agent, and the other parties thereto.(1)
(3)
96
21.1 Subsidiaries of the Registrant as of December 31, 2015.(1)
23.1 Consent of Ernst & Young LLP.(1)
31.1
31.2
32.1
32.2
Certification of the Chairman and Chief Executive Officer pursuant to
Rule 13a-14(a) or 15d-14(a) of the Securities Exchange Act of 1934, as
adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.(1)
Certification of the Chief Financial Officer pursuant to Rule 13a-14(a) or 15d-
14(a) of the Securities Exchange Act of 1934, as adopted pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002.(1)
Certification of the Chairman and Chief Executive Officer pursuant to 18
U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-
Oxley Act of 2002.(4)
Certification of 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.(4)
101.INS XBRL Instance
101.SCH XBRL Taxonomy Extension Schema
101.CAL XBRL Taxonomy Extension Calculation
101.DEF XBRL Taxonomy Extension Definition
101.LAB XBRL Taxonomy Extension Labels
101.PRE XBRL Taxonomy Extension Presentation
_______________________________________________________________________________
(1)
(2)
(3)
(4)
Filed herewith.
Reflects management contracts and management and director compensatory plans.
Certain schedules and similar attachments have been omitted and the Registrant hereby agrees to furnish a copy of any omitted schedule or similar
attachment to the SEC upon request.
Furnished herewith.
97
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
SIGNATURES
by the undersigned, thereunto duly authorized.
March 28, 2016
MATCH GROUP, INC.
By:
/s/ GARY SWIDLER
Gary Swidler
Chief Financial Officer
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 indicated on March 28, 2016 :
Signature
Title
/s/ GREGORY R. BLATT
Gregory R. Blatt
/s/ GARY SWIDLER
Gary Swidler
Chairman of the Board, Chief Executive Officer and Director
Chief Financial Officer
/s/ MICHAEL H. SCHWERDTMAN
Vice President and Principal Accounting Officer
Michael H. Schwerdtman
/s/ SONALI DE RYCKER
Sonali De Rycker
/s/ JOSEPH LEVIN
Joseph Levin
/s/ ANN L. McDANIEL
Ann L. McDaniel
/s/ THOMAS J. McINERNEY
Thomas J. McInerney
/s/ PAMELA S. SEYMON
Pamela S. Seymon
/s/ ALAN G. SPOON
Alan G. Spoon
/s/ MARK STEIN
Mark Stein
/s/ GREGG WINIARSKI
Gregg Winiarski
/s/ SAM YAGAN
Sam Yagan
Director
Director
Director
Director
Director
Director
Director
Director
Vice Chairman of the Board (non-executive) and Director
98
MATCH GROUP, INC. AND SUBSIDIARIES
VALUATION AND QUALIFYING ACCOUNTS
Schedule II
Balance at
Beginning of Period
Charges to
Earnings
Charges to
Other Accounts
(In thousands)
Deductions
Balance at
End of Period
$
$
$
1,133 $
24,805
2,098
856 $
23,202
2,203
240 $
24,375
1,901
656
300
(1) $
(2)
87
$
(137)
(4) $
(1,861)
(3)
—
114
1,286
(1) $
(5)
384
$
317
(6)
(221)
(4) $
—
86
(915)
(1) $
(7)
533
$
(258)
(8)
(4) $
(3)
—
1,739
23,244
2,514
1,133
24,805
2,098
856
23,202
2,203
Description
2015
Allowance for doubtful accounts
Deferred tax valuation allowance
Other reserves
2014
Allowance for doubtful accounts
Deferred tax valuation allowance
Other reserves
2013
Allowance for doubtful accounts
Deferred tax valuation allowance
Other reserves
_________________________________________________________
(1)
(2)
(3)
Additions to the allowance for doubtful accounts are charged to expense.
Amount is primarily related to a net increase in foreign, federal and state net operating losses.
Amount is primarily related to the decrease in unbenefited unrealized losses on an available-for-sale marketable equity security included in accumulated other
comprehensive loss and currency translation adjustments on foreign net operating losses.
(4) Write-off of fully reserved accounts receivable.
(5)
(6)
(7)
(8)
Amount is primarily related to federal net operating losses.
Amount is primarily related to the increase in unbenefited unrealized losses on a long-term marketable equity security included in accumulated other
comprehensive loss, partially offset by currency translation adjustments on foreign net operating losses.
Amount is primarily related to foreign net operating losses.
Amount is related to the decrease in unbenefited unrealized losses on a long-term marketable equity security included in accumulated other comprehensive
loss.
99
Exhibit 4.1
EXECUTION VERSION
MATCH GROUP, INC.
and
COMPUTERSHARE TRUST COMPANY, N.A., as Trustee
INDENTURE
Dated as of November 16, 2015
6.75% Senior Notes due 2022
TIA
Section
310
(a)(1)
(a)(2)
(a)(3)
(a)(4)
(a)(5)
(b)
(b)(1)
311
(a)
(b)
(c)
312
(a)
(b)
(c)
313
(a)
(b)(1)
(b)(2)
(c)
(d)
314
(a)
(b)
(c)(1)
(c)(2)
(c)(3)
(d)
(e)
(f)
315
316
317
CROSS-REFERENCE TABLE
Indenture
Section
11.01
7.10
7.10
N.A.
N.A.
N.A.
7.10
7.10
11.01
7.11
7.11
N.A.
11.01
2.06
11.03
11.03
11.01
7.06
N.A.
7.06
7.06
7.06
4.04; 11.01
N.A.
12.04
N.A.
N.A.
N.A.
N.A.
N.A.
N.A.
11.01
11.01
11.01
N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a part of the Indenture
TABLE OF CONTENTS
Page
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions. 1
SECTION 1.02. Other Definitions. 30
SECTION 1.03. Incorporation by Reference of Trust Indenture Act. 31
SECTION 1.04. Rules of Construction. 31
ARTICLE TWO THE NOTES
SECTION 2.01. Amount of Notes. 32
SECTION 2.02. Form and Dating; Book Entry Provisions. 32
SECTION 2.03. Execution and Authentication. 35
SECTION 2.04. Registrar and Paying Agent. 35
SECTION 2.05. Paying Agent to Hold Money in Trust. 36
SECTION 2.06. Holder Lists. 36
SECTION 2.07. Transfer and Exchange. 37
SECTION 2.08. Replacement Notes. 37
SECTION 2.09. Outstanding Notes. 38
SECTION 2.10. Treasury Notes. 38
SECTION 2.11. Temporary Notes. 38
SECTION 2.12. Cancellation. 39
SECTION 2.13. Defaulted Interest. 39
SECTION 2.14. CUSIP Number. 39
SECTION 2.15. Deposit of Moneys. 39
SECTION 2.16. Special Transfer Provisions. 40
SECTION 2.17. Certificated Notes. 45
SECTION 2.18. Computation of Interest. 47
ARTICLE THREE REDEMPTION
SECTION 3.01. Election to Redeem; Notices to Trustee. 47
SECTION 3.02. Selection by Trustee of Notes to Be Redeemed. 47
SECTION 3.03. Notice of Redemption. 48
SECTION 3.04. Effect of Notice of Redemption. 49
SECTION 3.05. Deposit of Redemption Price. 49
SECTION 3.06. Notes Redeemed in Part. 50
SECTION 3.07. Mandatory Redemption. 50
ARTICLE FOUR COVENANTS
SECTION 4.01. Payment of Notes. 50
SECTION 4.02. Reports to Holders. 50
SECTION 4.03. Waiver of Stay, Extension or Usury Laws. 51
SECTION 4.04. Compliance Certificate; Notice of Default. 52
SECTION 4.05. Limitations on Incurrence of Indebtedness. 52
SECTION 4.06. Limitations on Restricted Payments. 56
SECTION 4.07. Limitations on Asset Sales. 59
SECTION 4.08. Limitations on Transactions with Affiliates. 59
SECTION 4.09. Limitations on Liens. 61
SECTION 4.10. Future Note Guarantees. 61
SECTION 4.11. Limitations on Dividend and Other Restrictions Affecting
Restricted Subsidiaries. 62
SECTION 4.12. Limitations on Designation of Unrestricted Subsidiaries. 63
SECTION 4.13. Existence. 64
SECTION 4.14. Change of Control Offer. 64
SECTION 4.15. Suspension Event. 66
ARTICLE FIVE SUCCESSOR CORPORATION
SECTION 5.01. Limitations on Mergers, Consolidations, etc. 67
SECTION 5.02. Successor Person Substituted. 69
ARTICLE SIX DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default. 69
SECTION 6.02. Acceleration 71
SECTION 6.03. Other Remedies. 71
SECTION 6.04. Waiver of Past Defaults and Events of Default. 72
SECTION 6.05. Control by Majority. 72
SECTION 6.06. Limitation on Suits. 72
SECTION 6.07. No Personal Liability of Directors, Officers, Employees and
Stockholders. 73
SECTION 6.08. Rights of Holders to Receive Payment. 73
SECTION 6.09. Collection Suit by Trustee. 73
SECTION 6.10. Trustee May File Proofs of Claim 73
SECTION 6.11. Priorities. 74
SECTION 6.12. Undertaking for Costs. 74
ARTICLE SEVEN TRUSTEE
SECTION 7.01. Duties of Trustee. 74
SECTION 7.02. Rights of Trustee. 76
SECTION 7.03. Individual Rights of Trustee. 77
SECTION 7.04. Trustee’s Disclaimer. 77
SECTION 7.05. Notice of Defaults. 77
SECTION 7.06. Reports by Trustee to Holders. 78
SECTION 7.07. Compensation and Indemnity. 78
SECTION 7.08. Replacement of Trustee. 79
SECTION 7.09. Successor Trustee by Consolidation, Merger, etc. 80
SECTION 7.10. Eligibility; Disqualification. 80
SECTION 7.11. Preferential Collection of Claims Against Issuer. 80
SECTION 7.12. Paying Agents. 80
ARTICLE EIGHT AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 8.01. Without Consent of Holders. 81
SECTION 8.02. With Consent of Holders. 82
SECTION 8.03. Compliance with Trust Indenture Act. 83
SECTION 8.04. Revocation and Effect of Consents. 83
SECTION 8.05. Notation on or Exchange of Notes. 84
SECTION 8.06. Trustee to Sign Amendments, etc. 84
ARTICLE NINE
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 9.01. Discharge of Indenture. 85
SECTION 9.02. Legal Defeasance. 85
SECTION 9.03. Covenant Defeasance. 86
SECTION 9.04. Conditions to Legal Defeasance or Covenant Defeasance. 86
SECTION 9.05. Deposited Money and U.S. Government Obligations to Be Held in
Trust; Other Miscellaneous Provisions. 88
SECTION 9.06. Reinstatement. 88
SECTION 9.07. Moneys Held by Paying Agent. 88
SECTION 9.08. Moneys Held by Trustee. 89
ARTICLE TEN GUARANTEE OF NOTES
SECTION 10.01. Guarantee. 89
SECTION 10.02. Execution and Delivery of Guarantee. 90
SECTION 10.03. Limitation of Guarantee. 90
SECTION 10.04. Release of Guarantor. 91
SECTION 10.05. Waiver of Subrogation. 91
ARTICLE ELEVEN MISCELLANEOUS
SECTION 11.01. Trust Indenture Act Controls. 92
SECTION 11.02. Notices. 92
SECTION 11.03. Communications by Holders with Other Holders. 94
SECTION 11.04. Certificate and Opinion as to Conditions Precedent. 94
SECTION 11.05. Statements Required in Certificate and Opinion. 94
SECTION 11.06. Rules by Trustee and Agents. 95
SECTION 11.07. Business Days. 95
SECTION 11.08. Governing Law. 95
SECTION 11.09. Waiver of Jury Trial 95
SECTION 11.10. Force Majeure 95
SECTION 11.11. No Adverse Interpretation of Other Agreements. 95
SECTION 11.12. No Recourse Against Others. 95
SECTION 11.13. Successors. 96
SECTION 11.14. Multiple Counterparts. 96
SECTION 11.15. Table of Contents, Headings, etc. 96
SECTION 11.16. Separability. 96
SECTION 11.17. USA Patriot Act 96
Exhibit A Form of Global Initial Note .......................................................................... A-1
Exhibit B Form of Global Exchange Note .....................................................................B-1
Exhibit C Form of Certificate to Be Delivered in Connection with Transfers
Pursuant to Regulation S ..........................................................................C-1
EXHIBITS
INDENTURE, dated as of November 16, 2015, between MATCH GROUP, INC., a Delaware corporation, as issuer (the “ Issuer ”)
and COMPUTERSHARE TRUST COMPANY, N.A., as trustee (the “ Trustee ”).
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions .
“ Acquired Indebtedness ” means (1) with respect to any Person that becomes a Restricted Subsidiary after the Issue Date,
Indebtedness of such Person and its Subsidiaries existing at the time such Person becomes a Restricted Subsidiary that was not
incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary and (2) with respect to the Issuer
or any Restricted Subsidiary, any Indebtedness of a Person (other than the Issuer or a Restricted Subsidiary) existing at the time such
Person is merged with or into the Issuer or a Restricted Subsidiary, or Indebtedness expressly assumed by the Issuer or any Restricted
Subsidiary in connection with the acquisition of an asset or assets from another Person, which Indebtedness was not, in any case,
incurred by such other Person in connection with, or in contemplation of, such merger or acquisition.
“ Additional Interest ” means all additional interest then owing pursuant to the Registration Rights Agreement.
“ Additional Notes ” means an unlimited principal amount of Notes having identical terms and conditions to the Notes issued
pursuant to Article Two and in compliance with Section 4.05, except for issue date, issue price and first interest payment date.
“ Adjusted Treasury Rate ” means, with respect to any Redemption Date (i) the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication
which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United
States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to
the Comparable Treasury Issue (if no maturity is within three months before or after the Remaining Life (as defined below), yields for the two
published maturities most closely corresponding to the Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate shall
be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month); or (ii) if such release (or any successor
release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the
semiannual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to theComparable Treasury Price for such Redemption Date. The Adjusted Treasury
Rate shall be calculated on the third Business Day preceding the Redemption Date. Any weekly
1
average yields calculated by interpolation will be rounded to the nearest 1/100th of 1%, with any figure of 1/200th of 1% or above
being rounded upward.
“ Affiliate ” of any Person means any other Person which directly or indirectly Controls or is Controlled by, or is under direct or
indirect common Control with, the referent Person.
“ Affiliated Persons ” means, with respect to any specified Person, (a) such specified Person’s parents, spouse, siblings, descendants,
stepchildren, step grandchildren, nieces and nephews and their respective spouses, (b) the estate, legatees and devisees of such
specified Person and each of the Persons referred to in clause (a), and (c) any company, partnership, trust or other entity or investment
vehicle Controlled by any of the Persons referred to in clause (a) or (b) or the holdings of which are for the primary benefit of any of
such Persons.
“Agent” means any Registrar, Paying Agent or agent for service of notices and demands.
“ amend ” means to amend, supplement, restate, amend and restate or otherwise modify, including successively, and “ amendment ”
shall have a correlative meaning.
“ Applicable Premium ” means, with respect to any Note on any Redemption Date, the greater of:
(1) 1.0% of the principal amount of such Note; and
(2) the excess, if any, of (a) the present value at such Redemption Date of (i) the redemption price of such Note at
December 15, 2017 (such redemption price being set forth in the table appearing above), plus (ii) all required interest
payments due on such Note through December 15, 2017 (excluding accrued but unpaid interest to the Redemption Date),
computed using a discount rate equal to the Adjusted Treasury Rate as of such Redemption Date plus 50 basis points; over (b)
the principal amount of such Note.
Calculation of the Applicable Premium will be made by the Issuer or on behalf of the Issuer by such Person as the
Issuer shall designate; provided that such calculation or the correctness thereof shall not be a duty or obligation of the Trustee.
“ asset ” means any asset or property.
“ Asset Acquisition ” means
(1)
an Investment by the Issuer or any Restricted Subsidiary in any other Person if, as a result of such
Investment, such Person shall become a Restricted Subsidiary, or shall be merged with or into the Issuer or any Restricted
Subsidiary, or
(2)
the acquisition by the Issuer or any Restricted Subsidiary of all or substantially all of the assets of any other
Person or any division or line of business of any other Person.
2
“ Asset Sale ” means any sale, issuance, conveyance, transfer, lease, assignment or other disposition by the Issuer or any Restricted
Subsidiary to any Person other than the Issuer or any Restricted Subsidiary (including by means of a sale and leaseback transaction or
a merger or consolidation) (collectively, for purposes of this definition, a “ t r ansfer”), in one transaction or a series of related
transactions, of any assets of the Issuer or any of its Restricted Subsidiaries other than in the ordinary course of business. For
purposes of this definition, the term “Asset Sale” shall not include:
(1)
(2)
(3)
5.01;
transfers of cash or Cash Equivalents;
transfers of assets (including Equity Interests) that are governed by, and made in accordance with, Section
Permitted Investments and Restricted Payments permitted under Section 4.06;
(4)
the creation of any Lien permitted under this Indenture;
(5)
transfers of assets that are (i) damaged, worn-out, uneconomic, obsolete or otherwise deemed to be no
longer necessary or useful in the current or anticipated business of the Issuer or its Restricted Subsidiaries or (ii) replaced by
assets of similar suitability and value;
(6)
sales or grants of licenses or sublicenses to use the patents, trade secrets, know-how and other intellectual
property, and licenses, leases or subleases of other assets, of the Issuer or any Restricted Subsidiary to the extent not
materially interfering with the business of Issuer and the Restricted Subsidiaries;
(7)
any transfer or series of related transfers that, but for this clause, would be Asset Sales, if the aggregate Fair
Market Value of the assets transferred in such transaction or any such series of related transactions does not exceed $50.0
million for such transaction or any such series of related transactions;
(8)
sale and leaseback transactions with respect to property with an aggregate Fair Market Value not to exceed
the greater of $25.0 million and 3.0% of Consolidated Cash Flow calculated after giving effect thereto on a pro forma basis
for the then most recently ended Test Period;
(9)
any transfer or series of transfers that, but for this clause, would be Asset Sales if consummated at a time
when, after giving pro forma effect thereto, (x)(i) the Consolidated Leverage Test would be satisfied or (ii) the Consolidated
Leverage Ratio immediately following such transfer or series of transfers is less than or equal to the Consolidated Leverage
Ratio of the Issuer immediately prior to such transfer or series of transfers, and (y) no Default shall have occurred and be
continuing or occur as a consequence thereof; and
(10)
any transfer in connection with the Match Transactions.
3
“ Asset Swap ” means any exchange of assets of the Issuer or any Restricted Subsidiary (including Equity Interests of
a Restricted Subsidiary) for assets of another Person (including Equity Interests of a Person whose primary business is a Related
Business) that are intended to be used by the Issuer or any Restricted Subsidiary in a Related Business, including, to the extent
necessary to equalize the value of the assets being exchanged, cash of any party to such asset swap.
“ Bankruptcy Law ” means Title 11 of the United States Code, as amended, or any similar federal or state law for the relief of
debtors.
“ Below Investment Grade Rating Event ” means the Notes are rated below an Investment Grade Rating by each of the Rating
Agencies at any time during the period beginning on the date of the first public notice of an arrangement that would result in a
Change of Control and ending at the end of the 60-day period following public notice of the occurrence of the Change of Control
(which 60-day period shall be extended so long as the rating of the Notes is under publicly announced consideration for possible
downgrade by any of the Rating Agencies); provided that a Below Investment Grade Rating Event otherwise arising by virtue of a
particular reduction in rating shall not be deemed to have occurred in respect of a particular Change of Control (and thus shall not be
deemed a Below Investment Grade Rating Event for purposes of the definition of Change of Control Triggering Event hereunder) if
the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly
confirm or inform the Holders of Notes in writing at their request that the reduction was the result, in whole or in part, of any event or
circumstance comprising or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable
Change of Control shall have occurred at the time of the Below Investment Grade Rating Event).
“ Board of Directors ” means, with respect to any Person, (i) in the case of any corporation, the board of directors of such Person, or
the functional equivalent of the foregoing, (ii) in the case of any limited liability company, the board of managers of such Person, (iii)
in the case of any partnership, the Board of Directors of the general partner of such Person and (iv) in any other case, the functional
equivalent of the foregoing or, in each case, other than for purposes of the definition of “Change of Control,” any duly authorized
committee of such body.
“ Board Resolution ” means a copy of a resolution certified pursuant to an Officer’s Certificate to have been duly adopted by the
Board of Directors of the Issuer and to be in full force and effect, and delivered to the Trustee.
“ Business Day ” means a day other than a Saturday, Sunday or other day on which banking institutions in New York or the city in
which the Trustee’s Corporate Trust Office is located are authorized or required by law to close.
“ Capitalized Lease Obligations ” of any Person means the obligations of such Person to pay rent or other amounts under any lease of
(or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required
to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such
obligations shall be the capitalized amount thereof determined in accordance with
4
GAAP; provided however , that any obligations relating to a lease that would have been accounted by such Person as an operating
lease in accordance with GAAP as of the Issue Date shall be accounted for as an operating lease and not a Capitalized Lease
Obligation for all purposes under this Indenture.
“ Cash Equivalents ” means:
(1)
marketable direct obligations issued by, or unconditionally guaranteed by, the United States Government or
issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within one
year from the date of acquisition;
(2)
certificates of deposit, time deposits, eurodollar time deposits or overnight bank deposits having maturities
of one year or less from the date of acquisition issued by any commercial bank organized under the laws of the United States
or any state thereof or any lender or any Affiliate of any lender party to the Credit Agreement;
(3)
commercial paper of an issuer rated at least A-1 by Standard & Poor’s or P-1 by Moody’s, or carrying an
equivalent rating by a nationally recognized rating agency, if both of the two named rating agencies cease publishing ratings
of commercial paper issuers generally, and maturing within one year from the date of acquisition;
(4)
(5)
(6)
(7)
with respect to securities issued or fully guaranteed or insured by the United States government;
repurchase obligations of any commercial bank satisfying the requirements of clause (2) of this definition
securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any
state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any such state,
commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political
subdivision, taxing authority or foreign government (as the case may be) are rated at least A by Standard & Poor’s or A by
Moody’s;
issued by any commercial bank satisfying the requirements of clause (2) of this definition;
securities with maturities of one year or less from the date of acquisition backed by standby letters of credit
clauses (1) through (6) of this definition;
money market mutual or similar funds that invest exclusively in assets satisfying the requirements of
(8)
money market funds that (i) comply with the criteria set forth in SEC Rule 2a-7 under the Investment
Company Act of 1940, as amended, (ii) are rated AAA by Standard & Poor’s or Aaa by Moody’s and (iii) have portfolio
assets of at least
$5,000,000,000; and
5
(9)
in the case of any Foreign Subsidiary, investments substantially comparable to any of the foregoing
investments with respect to the country in which such Foreign Subsidiary is organized.
“ Change of Control ” means the occurrence of any of the following events:
(1)
the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the assets of
the Issuer and its Subsidiaries, taken as a whole, to any Person other than a Permitted Holder, and either (a) such Person is a
Disqualified Person or (b) on any day until the date that is six months after the date on which such sale, lease or transfer
occurred, the Issuer is rated by one of Moody’s or Standard & Poor’s and the rating assigned by either of them is not an
Investment Grade Rating;
(2)
the acquisition of beneficial ownership by any person or group (excluding any one or more Permitted
Holders or group Controlled by any one or more Permitted Holders) of more than 35% of the aggregate voting power of all
outstanding classes or series of the Issuer’s voting stock and such aggregate voting power exceeds the aggregate voting power
of all outstanding classes or series of the Issuer’s voting stock beneficially owned by the Permitted Holders collectively, and
either (a) such person or group is a Disqualified Person or (b) on any day until the date that is six months after the date on
which such person or group becomes such beneficial owner, the Issuer is rated by one of Moody’s or Standard & Poor’s and
the rating assigned by either of them is not an Investment Grade Rating;
(3)
during any period of two consecutive years, individuals who at the beginning of such period constituted the
Board of Directors of the Issuer (together with any new directors whose election by the Board of Directors or whose
nomination for election by the equityholders of the Issuer was approved by a vote of the majority of the directors of the Issuer
then still in office who were either directors at the beginning of such period or whose election or nomination for election was
previously so approved) cease for any reason to constitute a majority of the Issuer’s Board of Directors then in office; or
(4)
the Issuer shall adopt a plan of liquidation or dissolution or any such plan shall be approved by the
equityholders of the Issuer.
Notwithstanding the foregoing, a transaction in which the Issuer becomes a Subsidiary of another Person (other than a Person that is
an individual or a Permitted Holder) shall not constitute a Change of Control if the shareholders of the Issuer immediately prior to
such transaction beneficially own, directly or indirectly through one or more intermediaries, the same proportion of voting power of
the outstanding classes or series of the Issuer’s voting stock as such shareholders beneficially own immediately following the
consummation of such transaction.
For purposes of this definition, a Person shall not be deemed to have beneficial ownership of securities subject to a stock purchase
agreement, merger agreement or similar agreement until the consummation of the transactions contemplated by such agreement.
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“ Change of Control Triggering Event ” means the occurrence of both a Change of Control and a Below Investment Grade Rating
Event occurring in respect of that Change of Control.
“ Comparable Treasury Issue ” means the United States Treasury security selected by an Independent Investment Banker as having a
maturity comparable to the period from the relevant Redemption Date to December 15, 2017 that would be utilized, at the time of
selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable
maturity to such period (“ Remaining Life ”).
“ Comparable Treasury Price ” means (1) the average of four Reference Treasury Dealer Quotations for such redemption date, after
excluding the highest and lowest Reference Treasury Dealer Quotations, or (2) if the Independent Investment Banker obtains fewer
than four such Reference Treasury Dealer Quotations, the average of all such quotations.
“ Consolidated Amortization Expense ” for any period means the amortization expense of the Issuer and its Restricted Subsidiaries
for such period, determined on a consolidated basis in accordance with GAAP.
“ Consolidated Cash Flow ” for any period means, without duplication, the sum of the amounts for such period of
(1)
Consolidated Net Income, plus
(2)
Income,
in each case only to the extent (and in the same proportion) deducted in determining Consolidated Net
(a)
(b)
(c)
(d)
(e)
Consolidated Income Tax Expense,
Consolidated Amortization Expense,
Consolidated Depreciation Expense,
Consolidated Interest Expense,
all non-cash compensation, as reported in the Issuer’s financial statements,
(f)
any non-cash charges or losses or realized losses related to the write-offs, write-downs or mark-to-
market adjustments or sales or exchanges of any investments in debt or equity securities by the Issuer or any Restricted
Subsidiary,
(g)
the aggregate amount of all other non-cash charges, expenses or losses reducing such Consolidated
Net Income, including any impairment (including any impairment of intangibles and goodwill) (excluding any non-
cash charge, expense or loss that results in an accrual of a reserve for cash charges in any future period and any non-
cash charge, expense or loss relating to write-offs,
7
write-downs or reserves with respect to accounts receivable or inventory), for such period, and
(h)
the amount of any restructuring charges or reserves, including any one-time costs incurred in
connection with acquisitions, minus
(3)
in each case only to the extent (and in the same proportion) included in determining Consolidated Net
Income, any non-cash or realized gains related to mark-to- market adjustments or sales or exchanges of any investments in
debt or equity securities by the Issuer or any Restricted Subsidiary,
in each case determined on a consolidated basis in accordance with GAAP; provided that the aggregate amount of all non-cash items,
determined on a consolidated basis, to the extent such items increased Consolidated Net Income for such period will be excluded
from Consolidated Net Income.
For purposes of this definition, whenever pro forma effect is to be given, the pro forma calculations shall be factually supportable,
reasonably identifiable and made in good faith by a responsible financial or accounting Officer of the Issuer. Any such pro forma
calculation may include adjustments appropriate, in the reasonable good faith determination of the Issuer as set forth in an Officer’s
Certificate, to reflect cost savings and other operating improvements or synergies reasonably expected to be realized within 12
months from the applicable event to be given pro forma effect.
“ Consolidated Contingent Consideration Fair Value Remeasurement Adjustments ” for any period means the contingent
consideration fair value remeasurement adjustments, of the Issuer and its Restricted Subsidiaries for such period, determined on a
consolidated basis in accordance with GAAP.
“ Consolidated Depreciation Expense ” for any period means the depreciation expense of the Issuer and its Restricted Subsidiaries for
such period, determined on a consolidated basis in accordance with GAAP.
“ Consolidated Income Tax Expense ” for any period means the provision for taxes of the Issuer and its Restricted Subsidiaries,
determined on a consolidated basis in accordance with GAAP.
“ Consolidated Interest Expense ” for any period means the sum, without duplication, of the total interest expense of the Issuer and its
Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP, minus consolidated interest
income of the Issuer and its Restricted Subsidiaries, and including, without duplication,
(1)
imputed interest on Capitalized Lease Obligations,
(2)
commissions, discounts and other fees and charges owed with respect to letters of credit securing financial
obligations, bankers’ acceptance financing and receivables financings,
8
(3)
(4)
(5)
(6)
(7)
the net costs associated with Hedging Obligations related to interest rates,
amortization of debt issuance costs, debt discount or premium and other financing fees and expenses,
the interest portion of any deferred payment obligations,
all other non-cash interest expense,
capitalized interest,
(8)
all dividend payments on any series of Disqualified Equity Interests of the Issuer or any Preferred Stock of
any Restricted Subsidiary (other than any such Disqualified Equity Interests or any Preferred Stock held by the Issuer or a
Wholly- Owned Restricted Subsidiary or to the extent paid in Qualified Equity Interests),
(9)
all interest payable with respect to discontinued operations, and
(10)
all interest on any Indebtedness described in clause (6) or (7) of the definition of Indebtedness, but
excluding, without duplication, (x) on and prior to the Separation Date, interest expense in respect of guarantees by any one or
more members of the Match Group of Indebtedness of any one or more members of the IAC Group and (y) interest on any
Pre-IPO Note.
“ Consolidated Leverage Ratio ” means, at any date, the ratio of (i) Indebtedness of the Issuer and its Restricted Subsidiaries as of the
last day of the Test Period most recently ended on or prior to such date of determination (as set forth on the balance sheet and
determined on a consolidated basis in accordance with GAAP but excluding, (x) on and prior to the Separation Date, Indebtedness
consisting of guarantees by any one or more members of the Match Group of Indebtedness of any one or more members of the IAC
Group and (y) any Pre-IPO Note) to (ii) Consolidated Cash Flow during the most recent four consecutive full fiscal quarters for
which financial statements are available ending on or prior to the date of the transaction (the “ Transaction Date ”) giving rise to the
need to calculate the Consolidated Leverage Ratio (the “ Test Period ”). The Consolidated Leverage Ratio shall be calculated for any
period after giving effect on a pro forma basis (as if they had occurred on the first day of the applicable Test Period) to:
(1)
the incurrence of any Indebtedness of the Issuer or any Restricted Subsidiary (and the application of the proceeds thereof)
and any repayment, repurchase, defeasance or other discharge of Indebtedness (and the application of the proceeds therefrom) (other
than the incurrence or repayment of Indebtedness in the ordinary course of business for working capital purposes pursuant to any
revolving credit arrangement) occurring during the Test Period or at any time subsequent to the last day of the Test Period and on or
prior to the Transaction Date, as if such incurrence, repayment, issuance or redemption, as the case may be (and the application of the
proceeds thereof), occurred on the first day of the Test Period; and
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any (x) Asset Sale, (y) asset sale if the Fair Market Value of the assets sold in such transaction or series of related
(2)
transactions exceeds $2.0 million, which is solely excluded from the definition of Asset Sale pursuant to clause (9) of such definition
or (z) Asset Acquisition (including, without limitation, any Asset Acquisition giving rise to the need to make such calculation as a
result of the Issuer or any Restricted Subsidiary (including any Person who becomes a Restricted Subsidiary as a result of such Asset
Acquisition or as a result of a Redesignation) or operational restructuring (each a “ pro forma event”) (including any cost savings and
synergies resulting from head count reduction, closure of facilities and similar operational and other cost savings and synergies
relating to such pro forma event occurring within 12 months (or expected, in the good faith determination of the Issuer, to occur
within 12 months) of such pro forma event and during such period or subsequent to such period and on or prior to the date of such
calculation, in each case that are expected to have a continuing impact and are factually supportable, and which adjustments the Issuer
determines are reasonable as set forth in an Officer’s Certificate; provided that the aggregate amount of all such cost savings and
synergies shall in no event exceed 10% of Consolidated Cash Flow for such period calculated prior to giving effect to such pro forma
adjustments) occurring during the Test Period or at any time subsequent to the last day of the Test Period and on or prior to the
Transaction Date, as if such pro forma event occurred on the first day of the Test Period, provided that asset sales described in clause
(2)(y) in an aggregate amount not to exceed $50.0 million in any Test Period shall not be required to be given pro forma effect.
In calculating Consolidated Interest Expense for purposes of the Consolidated Leverage Ratio with respect to any Indebtedness being
given pro forma effect:
interest on outstanding Indebtedness determined on a fluctuating basis as of the Transaction Date and which will continue
(1)
to be so determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such
Indebtedness in effect on the Transaction Date;
if interest on any Indebtedness actually incurred on the Transaction Date may optionally be determined at an interest rate
(2)
based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rates, then the interest rate in effect on
the Transaction Date will be deemed to have been in effect during the Test Period;
(3)
notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a fluctuating basis, to the extent such
interest is covered by agreements relating to Hedging Obligations, shall be deemed to accrue at the rate per annum resulting after
giving effect to the operation of the agreements governing such Hedging Obligations;
(4)
such Indebtedness during the Test Period; and
interest on any Indebtedness under a revolving credit facility shall be computed based upon the average daily balance of
(5)
interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a
responsible financial or accounting Officer of the Issuer to be the rate of interest implicit in such Capitalized Lease Obligation in
accordance with GAAP.
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The Issuer may elect, pursuant to an Officer’s Certificate delivered to the Trustee to treat all or any portion of any revolving
commitment under any Indebtedness as being incurred and outstanding at such time and for so long as such revolving commitments
remain outstanding (regardless of whether drawn), in which case any subsequent incurrence of Indebtedness under such revolving
commitment shall not be deemed, for purposes of this calculation, to be an incurrence at such subsequent time.
“ Consolidated Leverage Test ” means, at any date, that the Consolidated Leverage Ratio is no greater than 5.00 to 1.00.
“ Consolidated Net Income ” for any period means the net income (or loss) of the Issuer and the Restricted Subsidiaries for such
period determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from such net income (to
the extent otherwise included therein), without duplication:
(1)
the net income (or loss) of any Person that is not a Restricted Subsidiary, except to the extent that cash in an
amount equal to any such income has actually been received by the Issuer or any Restricted Subsidiary during such period;
(2)
(3)
(4)
gains and losses due solely to fluctuations in currency values and the related tax effects according to GAAP;
gains and losses with respect to Hedging Obligations;
the cumulative effect of any change in accounting principles;
any extraordinary or nonrecurring gain (or extraordinary or nonrecurring loss), together with any related provision for
(5)
taxes on any such extraordinary or nonrecurring gain (or the tax effect of any such extraordinary or nonrecurring loss), realized by the
Issuer or any Restricted Subsidiary during such period;
(6)
Consolidated Contingent Consideration Fair Value Remeasurement Adjustments;
(7)
discontinued operations; and
any net after-tax income or loss from discontinued operations and any net after-tax gains or losses on disposal of
any gain (or loss), together with any related provisions for taxes on any such gain (or the tax effect of any such loss),
(8)
realized during such period by the Issuer or any Restricted Subsidiary upon (a) the acquisition of any securities, or the extinguishment
of any Indebtedness, of the Issuer or any Restricted Subsidiary or (b) the sale of any financial or equity investment by the Issuer or
any Restricted Subsidiary;
provided, further, that the effects of any adjustments in the inventory, property and equipment, software, goodwill, other intangible
assets, in-process research and development, deferred revenue, debt line items, any earn-out obligations and any other non-cash
charges (other than the amortization of unfavorable operating leases) in the Issuer’s consolidated financial statements pursuant to
GAAP in each case resulting from the application of purchase accounting in relation
11
to any consummated acquisition or the amortization or write-off of any such amounts shall be excluded when determining
Consolidated Net Income.
“ 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. “ C o ntrolling” and “ C o ntrolled” have
meanings correlative thereto.
“ Corporate Trust Office ” means the corporate trust office of the Trustee located at 8742 Lucent Boulevard, Suite 225, Highlands
Ranch, Colorado 80129, or such other office, designated by the Trustee by written notice to the Issuer, at which any particular time its
corporate trust business shall be administered.
“ Credit Agreement ” means the Credit Agreement, dated October 7, 2015, by and among the Issuer, as Borrower, the guarantors
party thereto from time to time, the lenders party thereto from time to time, JPMorgan Chase Bank, N.A., as administrative agent, and
the other agents and arrangers party thereto, including any notes, guarantees, collateral and security documents, instruments and
agreements executed in connection therewith, and in each case as amended, supplemented, modified, extended, restructured, renewed,
refinanced, restated, replaced or refunded in whole or in part from time to time.
“ Credit Facilities ” means one or more (A) debt facilities (which may be outstanding at the same time and including, without
limitation, the Credit Agreement) or commercial paper facilities, providing for revolving credit loans, term loans, 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 (including, without limitation, the Notes), 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
amended, supplemented, modified, extended, restructured, renewed, refinanced, restated, replaced or refunded in whole or in part
from time to time (including increasing the amount of available borrowings thereunder or adding Subsidiaries of the Issuer as
additional borrowers or guarantors thereunder).
“ Custodian ” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.
“ Dealer Manager Agreement ” means the dealer manager and solicitation agent agreement, dated as of October 16, 2015, by and
among the Dealer Managers and the Issuer.
“ Dealer Managers ” means Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities LLC, Goldman, Sachs &
Co., BNP Paribas Securities Corp., Deutsche Bank Securities Inc., BMO Capital Markets Corp., PNC Capital Markets LLC, Fifth
Third Securities, Inc. and SG Americas Securities, LLC.
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“ Default ” means (1) any Event of Default or (2) any event, act or condition that, after notice or the passage of time or both, would
be an Event of Default.
“ Definitive Note ” means a certificated Note bearing, if required, the appropriate restricted securities legend set forth in Section
2.16(d).
“ Depository ” means The Depository Trust Company, its nominees and their respective successors.
“ Designated Non-Cash Consideration ” means the Fair Market Value 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 pursuant to an Officer’s
Certificate, setting forth the basis of such valuation, less the amount of cash or Cash Equivalents received in connection with a
subsequent sale of such Designated Non-Cash Consideration.
“ Disqualified Equity Interests ” of any Person means any class of Equity Interests of such Person that, by its terms, or by the terms of
any related agreement or of any security into which it is convertible, puttable or exchangeable, is, or upon the happening of any event
or the passage of time would be, required to be redeemed by such Person, whether or not at the option of the holder thereof, or
matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, in whole or in part, in each case on or prior
to the date that is 91 days after the final maturity date of the Notes; provided , however , that any class of Equity Interests of such
Person that, by its terms, authorizes such Person to satisfy in full its obligations with respect to the payment of dividends or upon
maturity, redemption (pursuant to a sinking fund or otherwise) or repurchase thereof or otherwise by the delivery of Equity Interests
that are not Disqualified Equity Interests, and that is not convertible, puttable or exchangeable for Disqualified Equity Interests or
Indebtedness, will not be deemed to be Disqualified Equity Interests so long as such Person satisfies its obligations with respect
thereto solely by the delivery of Equity Interests that are not Disqualified Equity Interests; provided , further , however , that any
Equity Interests that would not constitute Disqualified Equity Interests but for provisions thereof giving holders thereof (or the
holders of any security into or for which such Equity Interests are convertible, exchangeable or exercisable) the right to require the
Issuer to redeem such Equity Interests upon the occurrence of a change in control occurring prior to the 91st day after the final
maturity date of the Notes shall not constitute Disqualified Equity Interests if (1) the change of control provisions applicable to such
Equity Interests are no more favorable to such holders than the provisions of Section 4.14, and (2) the right to require the Issuer to
redeem such Equity Interests does not become operative prior to the Issuer’s purchase of the Notes as required pursuant to the
provisions of Section 4.14.
“ Disqualified Person ” means a Person whose senior debt does not have an Investment Grade Rating with either Moody’s or
Standard & Poor’s on (a) the date on which (i) such Person becomes a beneficial owner of the Issuer or (ii) the sale, lease or transfer,
in one or a series of transactions, of all or substantially all of the assets of the Issuer and its Subsidiaries taken as a whole occurs, or
(b) any day until the date that is 45 days after the date described in clause (a).
13
“ Distribution Compliance Period ,” with respect to any Notes, means the period of 40 consecutive days beginning on and including
the later of (i) 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 and (ii) the issue date with respect to such Notes.
“ Domestic Subsidiary ” means any Subsidiary of the Issuer that is not a Foreign Subsidiary.
“ Equity Interests ” of any Person means (1) any and all shares or other equity interests (including common stock, preferred stock,
limited liability company interests and partnership interests) in such Person and (2) all rights to purchase, warrants or options
(whether or not currently exercisable), participations or other equivalents of or interests in (however designated) such shares or other
interests in such Person, but excluding any debt securities convertible into such shares or other interests.
“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time, the regulations promulgated
thereunder and any successor thereto.
“ Exchange Act ” means the U.S. Securities Exchange Act of 1934, as amended.
“ Exchange Notes ” means the debt securities of the Issuer issued pursuant to this Indenture in exchange for, and in an aggregate
principal amount equal to, the Notes, in compliance with the terms of the Registration Rights Agreement.
“ Exchange Offer ” means the offer by the Issuer, pursuant to the Registration Rights Agreement, to certain Holders of Initial Notes,
to issue and deliver to such Holders, in exchange for their Initial Notes, a like aggregate principal amount of Exchange Notes
registered under the Securities Act.
“ Fair Market Value ” means, with respect to any asset, as determined by the Issuer, the price (after taking into account any liabilities
relating to such assets) that would be negotiated in an arm’s-length transaction for cash between a willing seller and a willing and able
buyer, neither of which is under any compulsion to complete the transaction.
“ Foreign Subsidiary ” means any Subsidiary of the Issuer that is not organized under the laws of the United States or any jurisdiction
within the United States and any direct or indirect subsidiary thereof.
“ GAAP ” means generally accepted accounting principles 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 may be approved by a significant segment of the accounting
profession of the United States, consistently applied.
“ Governmental Authority ” means the government of the United States of America, any other nation or any political subdivision
thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity
exercising executive,
14
legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.
to purchase or pay (or advance or supply funds for the purchase or payment of) Indebtedness of such other Person (whether
“ guarantee ” means a direct or indirect guarantee by any Person of any Indebtedness of any other Person and includes any obligation,
direct or indirect, contingent or otherwise, of such Person
(1)
arising by virtue of partnership arrangements, or by agreements to keep well, to purchase assets, goods, securities or services (unless
such purchase arrangements are on arm’s-length terms and are entered into in the ordinary course of business), to take-or-pay, or to
maintain financial statement conditions or otherwise); or (2) entered into for purposes of assuring in any other manner the obligee of
such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); “ guarantee,”
when used as a verb, and “ guaranteed” have correlative meanings.
“ Guarantors ” means each Person that is required to, or at the election of the Issuer does, become a Guarantor by the terms of this
Indenture after the Issue Date, in each case, until such Person is released from its Note Guarantee in accordance with the terms of this
Indenture.
“ Hedging Obligations ” of any Person means the obligations of such Person under swap, cap, collar, forward purchase or similar
agreements or arrangements dealing with interest rates, currency exchange rates or commodity prices, either generally or under
specific contingencies.
“ Holder ” means any registered holder, from time to time, of the Notes.
“ IAC ” means IAC/InterActiveCorp. a Delaware corporation, and its successors.
“ IAC/Match Intercompany Debt ” means the incurrence prior to the Match Offering, extension of existing or settlement of (x)
unsecured intercompany loans, intercompany payables and intercompany receivables between the Match Group and the IAC Group
or (y) any intercompany contributions from the IAC Group to the Match Group (and, in each case, payments or distributions thereon),
in each case (i) under intercompany arrangements existing as of the Issue Date or put in place in connection with the Match Offering
or related transactions, (ii) in connection with the acquisition of Plentyoffish Media Inc. or (iii) in connection with cash management
arrangements; provided that any such Indebtedness could be incurred pursuant to the Leverage Ratio Exception.
“ IAC Credit Agreement ” means that certain Credit Agreement dated as of December 21, 2012, among IAC, as borrower, the
guarantors party thereto, the lenders party thereto, JPMorgan Chase Bank, N.A., as administrative agent, and the other agents and
arrangers party thereto (as amended and restated on October 7, 2015).
“ IAC Group ” means IAC and its subsidiaries not including the Issuer and its subsidiaries.
“ IAC Notes ” means the IAC 2022 Notes and the $500.0 million aggregate principal amount of 4.875% senior notes due 2018 of
IAC.
15
“ IAC 2022 Notes ” means the $500.0 million aggregate principal amount of 4.75% senior notes due 2022 of IAC issued pursuant to
that Indenture dated December 21, 2012 among IAC, the guarantors party thereto and Computershare Trust Company, N.A., as
trustee.
“ incur ” means, with respect to any Indebtedness or Obligation, incur, create, issue, assume, guarantee or otherwise become directly
or indirectly liable, contingently or otherwise, with respect to such Indebtedness or Obligation; provided that (1) the Indebtedness of a
Person existing at the time such Person became a Restricted Subsidiary shall be deemed to have been incurred by such Restricted
Subsidiary and (2) neither the accrual of interest nor the accretion of original issue discount or the accretion or accumulation of
dividends on any Equity Interests shall be deemed to be an incurrence of Indebtedness.
“ Indebtedness ” of any Person at any date means, without duplication:
(1)
(2)
all liabilities, contingent or otherwise, of such Person for borrowed money;
all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;
(3)
(4)
acceptances and similar credit transactions;
all reimbursement obligations of such Person in respect of letters of credit, letters of guaranty, bankers’
all obligations of such Person to pay the deferred and unpaid purchase price of property or services, except
(i) trade payables and accrued expenses incurred by such Person in the ordinary course of business and (ii) amounts accrued
associated with contingent consideration arrangements;
(5)
all Capitalized Lease Obligations of such Person;
(6)
all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right,
contingent or otherwise, to be secured by) a Lien on any asset of such Person, whether or not such Indebtedness is assumed by
such Person;
(7)
all Indebtedness of others guaranteed by such Person to the extent of such guarantee; provided that
Indebtedness of the Issuer or its Subsidiaries that is guaranteed by the Issuer or the Issuer’s Subsidiaries shall only be counted
once in the calculation of the amount of Indebtedness of the Issuer and its Subsidiaries on a consolidated basis; and
(8)
all obligations of such Person under conditional sale or other title retention agreements relating to assets
purchased by such Person (excluding obligations arising from inventory transactions in the ordinary course of business).
The amount of any Indebtedness which is incurred at a discount to the principal amount at maturity thereof as of any date shall be
deemed to have been incurred at the accreted value thereof as of such date. The amount of Indebtedness of any Person at any date
shall be the outstanding balance at such date of all unconditional obligations as described above, the
16
maximum liability of such Person for any such contingent obligations at such date and, in the case of clause (6), the lesser of (a) the
Fair Market Value of any asset subject to a Lien securing the Indebtedness of others on the date that the Lien attaches and (b) the
amount of the Indebtedness secured.
“ Indenture ” means this Indenture as amended, restated or supplemented from time to time.
“ Independent Investment Banker ” means one of the Reference Treasury Dealers appointed by the Issuer.
“ Initial Notes ” means the 6.75% Senior Notes due 2022 issued on the Issue Date.
“ interest ” means, with respect to the Notes, interest on the Notes (including Additional Interest, if any).
“ Interest Payment Dates ” means each June 15 and December 15, commencing June 15, 2016.
“ Investment Grade Rating ” means a rating equal to or higher than Baa3 (or the equivalent) if by Moody’s and BBB- (or the
equivalent) if by Standard & Poor’s.
“ Investments ” of any Person means:
(1)
all direct or indirect investments by such Person in any other Person in the form of loans, advances or
capital contributions or other credit extensions constituting Indebtedness of such other Person, and any guarantee of
Indebtedness of any other Person;
(2)
all purchases (or other acquisitions for consideration) by such Person of Indebtedness, Equity Interests or
other securities of any other Person (other than any such purchase that constitutes a Restricted Payment of the type described
in clause (2) of the definition thereof); and
(3)
the Designation of any Subsidiary as an Unrestricted Subsidiary.
Except as otherwise expressly specified in this definition, the amount of any Investment (other than an Investment made in cash) shall
be the Fair Market Value thereof on the date such Investment is made. The amount of Investment pursuant to clause (3) shall be the
Fair Market Value of the Issuer’s proportionate interest in such Unrestricted Subsidiary as of the date of such Unrestricted
Subsidiary’s designation as an Unrestricted Subsidiary. If the Issuer or any Restricted Subsidiary sells or otherwise disposes of any
Equity Interests of any Restricted Subsidiary, or any Restricted Subsidiary issues any Equity Interests, in either case, such that, after
giving effect to any such sale or disposition, such Person is no longer a Subsidiary, the Issuer shall be deemed to have made an
Investment on the date of any such sale or other disposition equal to the Fair Market Value of the Equity Interests of and all other
Investments in such Restricted Subsidiary retained. Notwithstanding the foregoing, purchases or redemptions of Equity Interests of
the Issuer shall be deemed not to be Investments.
17
“ Issue Date ” means November 16, 2015.
“ Issuer ” means the party named as such in the first paragraph of this Indenture until a successor replaces such party pursuant to
Article Five and thereafter means the successor.
“ Lien ” means, with respect to any asset, any mortgage, deed of trust, lien (statutory or other), pledge, easement, charge, security
interest or other encumbrance of any kind or nature in respect of such asset, whether or not filed, recorded or otherwise perfected
under applicable law, including the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title
retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such
asset.
“ Match Group ” means the Issuer and its Subsidiaries.
“ Match Offering ” means the issuance by the Issuer of up to an aggregate of 20% of the economic interest represented by all
outstanding capital stock of the Issuer as of the date of the Match Offering (after giving pro forma effect to the issuance of such
capital stock in such offering) in an initial underwritten public offering pursuant to an effective registration statement filed with the
SEC pursuant to the Securities Act.
“ Match Transaction Distributions ” means dividends or distributions of cash and other property from the Match Group to the IAC
Group (i) of a combination of cash and/or Pre-IPO Notes, which, in the aggregate, do not exceed the net cash proceeds of the Match
Offering (ii) of a combination of the net cash proceeds of certain Indebtedness incurred by the Match Group on or prior to the date of
the Match Offering and/or debt securities issued by Match or IAC, which in the aggregate do not exceed $1,300.0 million, in each
case, designated by the Issuer as incurred in connection with the Match Offering, (iii) of any cash on the balance sheet of the Match
Group on the Issue Date and any cash flow of the Match Group accruing from and after the Issue Date until the date of the Match
Offering and (iv) without duplication, in an amount equal to any proceeds from cash common equity contributions received by the
Match Group after the Issue Date and prior to the date of the Match Offering, in each case so long as, on a pro forma basis after
giving effect thereto and to the other transactions consummated in connection therewith, (x) the Consolidated Leverage Test is
satisfied, (y) no Default or Event of Default shall have occurred and be continuing.
“ Match Transactions ” means, the Match Offering, and in connection therewith, the entry into a number of related transactions and
agreements with the Match Group, including, but not limited to:
entry into and consummation of the transactions contemplated under a master transaction agreement, an investor rights
(a)
agreement, a services agreement, a tax sharing agreement, an employee matters agreement and similar agreements and arrangements
and the transactions in connection therewith;
(b) the IAC/Match Intercompany Debt;
18
(c) the Match Transaction Distributions;
(d) the issuance of the Notes contemplated hereby;
the entry into of the Credit Agreement and any incremental assumption agreements thereto and performance of the obligations
(e)
thereunder and any related agreements, including any guarantee agreements or pledge agreements; and
the creation of, and payments under, unsecured intercompany Indebtedness owed by a member of the Match Group to a
(f)
member of the IAC Group that by its terms is subordinated in right of payment to the Notes and is incurred pursuant to the Leverage
Ratio Exception.
“ Material Domestic Subsidiary ” means any Wholly-Owned Restricted Subsidiary that is a Domestic Subsidiary of the Issuer, as of
the last day of the fiscal quarter of the Issuer most recently ended for which financial statements have been or are required to have
been delivered, that has assets or revenues (including third party revenues but not including intercompany revenues) with a value in
excess of 2.50% of the consolidated assets of the Issuer and its Wholly- Owned Restricted Subsidiaries that are Domestic Subsidiaries
or 2.50% of the consolidated revenues of the Issuer and its Wholly-Owned Restricted Subsidiaries that are Domestic Subsidiaries;
provided that in the event Wholly-Owned Restricted Subsidiaries that are Domestic Subsidiaries that would otherwise not be Material
Domestic Subsidiaries shall in the aggregate account for a percentage in excess of 7.50% of the consolidated assets of the Issuer and
its Wholly-Owned Restricted Subsidiaries that are Domestic Subsidiaries or 7.50% of the consolidated revenues of the Issuer and its
Wholly-Owned Restricted Subsidiaries that are Domestic Subsidiaries as of the end of and for the most recently completed fiscal
quarter, then one or more of such Domestic Subsidiaries designated by the Issuer (or, if the Issuer shall make no designation, one or
more of such Domestic Subsidiaries in descending order based on their respective contributions to the consolidated assets of the
Issuer), shall be included as Material Domestic Subsidiaries to the extent necessary to eliminate such excess.
“ Moody’s ” means Moody’s Investors Service, Inc. and any successor to its rating agency business.
“ Non-Recourse Debt ” means Indebtedness of an Unrestricted Subsidiary:
(1)
as to which neither the Issuer nor any Restricted Subsidiary (a) provides credit support of any kind
(including any undertaking, agreement or instrument that would constitute Indebtedness) or (b) is directly or indirectly liable
as a guarantor or otherwise, and
(2)
no default with respect to which (including any rights that the holders thereof may have to take enforcement
action against an Unrestricted Subsidiary) would permit upon notice, lapse of time or both any holder of any other
Indebtedness (other than the Credit Agreement or Notes) of the Issuer or any Restricted Subsidiary to declare a default on the
other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity.
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“ Non-U.S. Person ” means a Person who is not a U.S. person, as defined in Regulation S.
“ Notes ” means the Initial Notes, the Exchange Notes and any Additional Notes.
“ Notes Custodian ” means the custodian with respect to a Global Note (as appointed by the Depository), or any successor Person
thereto and shall initially be the Trustee.
“ Obligation ” means any principal, interest, penalties, fees, indemnification, reimbursements, costs, expenses, damages and other
liabilities payable under the documentation governing any Indebtedness.
“ Offering Memorandum ” means the confidential offering memorandum and consent solicitation statement, dated as of October 16,
2015, relating to the Issuer’s offer to exchange the Initial Notes for any and all outstanding IAC 2022 Notes.
“ Officer ” means any of the following of the Issuer: the Chairman of the Board of Directors, the Chief Executive Officer, the Chief
Financial Officer, the President, any Vice President, the Treasurer or the Secretary.
“ Officer’s Certificate ” means a certificate signed by an Officer.
“ Opinion of Counsel ” means a written opinion reasonably satisfactory in form and substance to the Trustee from legal counsel,
which counsel is reasonably acceptable to the Trustee, opining on the matters required by Section 11.05 and delivered to the Trustee.
Such legal counsel may be an employee of or counsel to the Issuer.
“ Permitted Holders ” means any one or more of (a) IAC and its direct or indirect wholly-owned subsidiaries, (b) Barry Diller, (c)
each of the Affiliated Persons of the Person referred to in clause (b), and (d) any Person a majority of the aggregate voting power of
all the outstanding classes or series of the equity securities of which are beneficially owned by any one or more of the Persons
referred to in clauses (a), (b) or (c).
“ Permitted Investment ” means:
(1)
Investments by the Issuer or any Restricted Subsidiary in the Issuer, any Restricted Subsidiary or a Person
that will, upon the making of such Investment become a Restricted Subsidiary;
(2)
loans and advances to directors, employees and officers of the Issuer or any of the Restricted Subsidiaries
for bona fide business purposes and to purchase Equity Interests of the Issuer not in excess of $10.0 million at any one time
outstanding;
(3)
cash and Cash Equivalents;
(4)
receivables owing to the Issuer or any Restricted Subsidiary if created or acquired in the ordinary course of
business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms
may include such
20
concessionary trade terms as the Issuer or any such Restricted Subsidiary deems reasonable under the circumstances;
(5)
stock, obligations or securities received in settlement of debts created in the ordinary course of business and
owing to the Issuer or any Restricted Subsidiary or in satisfaction of judgments or pursuant to any plan of reorganization or
similar arrangement upon the bankruptcy or insolvency of any debtor, including securities of a Person received pursuant to
any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of such Person;
(6)
Investments made by the Issuer or any Restricted Subsidiary as a result of consideration received in
connection with a sale of assets made in compliance with Section 4.07;
(7)
(8)
lease, utility and other similar deposits in the ordinary course of business;
any Investment existing on, or made pursuant to binding commitments existing on, the Issue Date;
(9)
Investments, including in joint ventures of the Issuer or any of its Restricted Subsidiaries not otherwise
permitted under this Indenture, not to exceed in the aggregate outstanding at any time the greater of $75.0 million or 2.0% of
Total Assets as of the time of incurrence;
(10)
another Person if as a result of such Investment such other Person is merged or consolidated with or into,
or transfers or conveys all or substantially all its assets to, the Issuer or a Restricted Subsidiary; provided , however , that such
Person’s primary business is a Related Business;
(11)
guarantees issued in accordance with Section 4.05 and Section 4.10; and
(12)
to the extent constituting Investments, the Match Transactions. “ Permitted Liens ” means the following
types of Liens:
(1)
Liens for taxes, assessments or governmental charges or claims either (a) not delinquent or (b) contested in
good faith by appropriate proceedings and as to which the Issuer or a Restricted Subsidiary shall have set aside on its books
such reserves as may be required pursuant to GAAP;
(2)
statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, suppliers, materialmen,
repairmen and other Liens imposed by law incurred in the ordinary course of business for sums not yet delinquent by more
than 30 days or being contested in good faith, if such reserve or other appropriate provision, if any, as shall be required by
GAAP shall have been made in respect thereof;
21
(3)
pledges and deposits made in the ordinary course of business in compliance with workers’ compensation
(or pursuant to letters of credit issued in connection with such workers’ compensation compliance), unemployment insurance
and other social security laws or regulations or to secure the performance of statutory obligations, bids, leases, performance
and return-of-money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money);
(4)
Liens incurred or deposits made in the ordinary course of business to secure the performance of tenders,
statutory obligations, surety and appeal bonds, bids, leases, subleases, government contracts, performance and return-of-
money bonds, letters of credit and other similar obligations (exclusive of obligations for the payment of borrowed money);
(5)
Liens upon specific items of inventory or other goods and proceeds of any Person securing such Person’s
obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase,
shipment or storage of such inventory or other goods;
(6)
judgment Liens not giving rise to an Event of Default;
(7)
easements, zoning restrictions, rights-of-way, survey exceptions, minor encumbrances, reservation of
licenses, electric lines, telegraph and telephone lines and similar encumbrances on real property imposed by law or arising in
the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the
affected property or interfere with the ordinary conduct of business of the Issuer or any Restricted Subsidiary;
(8)
Liens securing obligations in respect of letters of credit, bank guarantees, warehouse receipts or similar
instruments issued to support performance obligations (other than Obligations in respect of Indebtedness) and trade-related
letters of credit, in each case, outstanding on the Issue Date or issued thereafter in and covering the goods (or the documents
of title in respect of such goods) financed by such letters of credit, banker’s acceptances or bank guarantees and the proceeds
and products thereof;
(9)
Liens encumbering deposits made to secure obligations arising from common law, statutory, regulatory,
contractual or warranty requirements of the Issuer or any Restricted Subsidiary, including rights of offset and setoff;
(10)
bankers’ Liens, rights of setoff and other similar Liens existing solely with respect to cash and Cash
Equivalents on deposit in one or more accounts maintained by the Issuer or any Restricted Subsidiary, in each case granted in
the ordinary course of business in favor of the bank or banks with which such accounts are maintained, securing amounts
owing to such bank with respect to cash management and operating account arrangements, including those involving pooled
accounts, sweep accounts and netting arrangements; provided that in no case shall any such Liens secure (either directly or
indirectly) the repayment of any Indebtedness;
22
(11)
leases, assignments, or subleases, licenses granted to others that do not materially interfere with the
ordinary course of business of the Issuer or any Restricted Subsidiary;
(12)
regarding leases;
Liens arising from filing Uniform Commercial Code financing statements or equivalent statements
(13)
Liens securing Indebtedness incurred pursuant to Section 4.05(b)(1);
(14)
Liens securing Hedging Obligations entered into for bona fide hedging purposes of the Issuer or any
Restricted Subsidiary not for the purpose of speculation;
(15)
Liens existing on the Issue Date;
(16)
Liens in favor of the Issuer or a Guarantor;
(17)
(18)
Liens securing Purchase Money Indebtedness or Capitalized Lease Obligations; provided that such Liens
secure obligations incurred pursuant to Section 4.05(b)(6);
Liens securing Acquired Indebtedness permitted to be incurred under this Indenture; provided that the
Liens do not extend to assets not subject to such Lien at the time of acquisition (other than (a) the property encumbered at the
time a Person becomes a Restricted Subsidiary, (b) after acquired property that is required to be pledged pursuant to the
agreement granting such Lien as in effect on the date such Person becomes a Restricted Subsidiary and (c) proceeds and
products thereof) and are no more favorable to the lienholders than those securing such Acquired Indebtedness prior to the
incurrence of such Acquired Indebtedness by the Issuer or a Restricted Subsidiary;
(19)
deposits and other Liens securing credit card operations of the Issuer and its Subsidiaries, provided the
amount secured does not exceed amounts owed by the Issuer and its Subsidiaries in connection with such credit card
operations;
(20)
Liens to secure Refinancing Indebtedness of Indebtedness secured by Liens referred to in the foregoing
clauses (13) (solely with respect to Section 4.05(b)(1)(y)), (15), (17) and (18); provided that in the case of Liens securing
Refinancing Indebtedness of Indebtedness secured by Liens referred to in the foregoing clauses (13) (solely with respect to
Section 4.05(b)(1)(y)), (15), (17) and (18), such Liens do not extend to any additional assets (other than (A) after-acquired
property that is required to be pledged pursuant to the agreement granting the Lien securing the Indebtedness being
Refinanced as in effect on the date the Refinancing Indebtedness is incurred and (B) proceeds and products thereof);
(21)
Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs
duties in connection with the importation of goods and Liens in the ordinary course of business in favor of issuers of
performance and surety bonds or bid bonds or with respect to health, safety and environmental regulations (other
23
than for borrowed money) or letters of credit or bank guarantees issued to support such bonds or requirements pursuant to the
request of and for the account of such Person in the ordinary course of business ;
(22)
Interests of vendors in inventory arising out of such inventory being subject to a “sale or return”
arrangement with such vendor or any consignment by any third party of any inventory;
(23)
Liens securing Indebtedness owed by (a) a Restricted Subsidiary to the Issuer or to any other Restricted
Subsidiary that is a Guarantor or (b) the Issuer to a Guarantor;
(24)
[reserved];
(25)
Liens in respect of sale and leaseback transactions with respect to assets with a Fair Market Value in the
aggregate of not more than the greater of $25.0 million or 3.0% of Consolidated Cash Flow, calculated after giving effect
thereto on a pro forma basis for the then most recently ended Test Period;
(26)
Liens with respect to obligations that do not in the aggregate exceed the greater of $50.0 million or 2.0%
of Total Assets as of the time of incurrence at any one time outstanding;
(27)
Liens securing obligations pursuant to cash management agreements and treasury transactions; and
(28)
Liens arising under any retention of title, hire purchase or conditional sale arrangement or arrangements
having similar effect in respect of goods supplied to the Issuer and its Restricted Subsidiaries in the ordinary course of trading
and on the supplier’s standard or usual terms.
“ Permitted Parent Payments ” means payments to any member of the IAC Group that is a direct or indirect parent of the Issuer, (a)
the proceeds of which shall be used to pay such equity holder’s operating costs and expenses incurred , other overhead costs and
expenses and fees, in each case, which are directly attributable to the ownership or operations of the Issuer and its Subsidiaries or (b)
the proceeds of which shall be used to pay customary salary, bonus and other benefits payable to, and indemnities provided on behalf
of, officers and employees of any direct or indirect parent of the Issuer to the extent such salaries, bonuses, other benefits and
indemnities are directly attributable to the ownership or operation of the Issuer and its Restricted Subsidiaries.
“ Person ” means any individual, corporation, partnership, limited liability company, joint venture, incorporated or unincorporated
association, joint-stock company, trust, unincorporated organization or government or other agency or political subdivision thereof or
other entity of any kind.
24
“Plan of Liquidation” with respect to any Person, means a plan that provides for, contemplates or the effectuation of which is
preceded or accompanied by (whether or not substantially contemporaneously, in phases or otherwise): (1) the sale, lease, conveyance
or other disposition of all or substantially all of the assets of such Person other than as an entirety or substantially as an entirety; and
(2) the distribution of all or substantially all of the proceeds of such sale, lease, conveyance or other disposition of all or substantially
all of the remaining assets of such Person to holders of Equity Interests of such Person.
“ Pre-IPO Note ” means any intercompany debt (i) owed by Match to any member of the IAC Group, (ii) incurred within 30 days
prior to the Match Offering, (iii) having a maturity not in excess of 30 days, (iv) that by its terms is subordinated in right of payment
to the obligations under the Notes, and (v) that is designated as such by the Issuer.
“ Preferred Stock ” means, with respect to any Person, any and all preferred or preference stock or other equity interests (however
designated) of such Person whether now outstanding or issued after the Issue Date.
“ principal ” means, with respect to the Notes, the principal of, and premium, if any, on the Notes.
“ Purchase Money Indebtedness ” means Indebtedness, including Capitalized Lease Obligations, of the Issuer or any Restricted
Subsidiary incurred for the purpose of financing all or any part of the purchase price of property, plant or equipment used in the
business of the Issuer or any Restricted Subsidiary or the cost of installation, construction or improvement thereof; provided, however
, that (A) such Indebtedness is comprised of Capitalized Lease Obligations or (B)(1) the amount of such Indebtedness shall not
exceed such purchase price or cost and (2) such Indebtedness shall be incurred within 90 days after such acquisition of such asset by
the Issuer or such Restricted Subsidiary or such installation, construction or improvement.
“ Qualified Equity Interests ” of any Person means Equity Interests of such Person other than Disqualified Equity Interests. Unless
otherwise specified, Qualified Equity Interests refer to Qualified Equity Interests of the Issuer.
“ Qualified Institutional Buyer ” or “ QIB ” has the meaning specified in Rule 144A promulgated under the Securities Act.
“ Rating Agencies ” means (1) each of Moody’s and Standard & Poor’s; and (2) if any of Moody’s or Standard & Poor’s ceases to
rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of the Issuer’s control, a “nationally
recognized statistical rating organization” as such term is defined for purposes of Section 3(a)(62) of the Exchange Act, that the
Issuer selects (as certified by an Officer of the Issuer) as a replacement agency for Moody’s or Standard & Poor’s, or both of them, as
the case may be.
“ redeem ” means to redeem, repurchase, purchase, defease, retire, discharge or otherwise acquire or retire for value; and “
redemption ” shall have a correlative meaning; provided that this definition shall not apply for purposes of Article Three and
paragraph 6 of the Notes.
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“ Redemption Date ” when used with respect to any Note to be redeemed means the date fixed for such redemption pursuant to the
terms of the Notes.
“ Reference Treasury Dealer ” means any primary U.S. Government securities dealer in New York City selected by the Issuer.
“ Reference Treasury Dealer Quotations ” means, with respect to each Reference Treasury Dealer and any redemption date, the
average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue
(expressed in each case as a percentage of its principal amount) quoted in writing to the Independent Investment Banker at 5:00 p.m.,
New York City time, on the third Business Day preceding such redemption date.
“ refinance ” means, in respect of any Indebtedness, to refinance, extend, renew, refund, repay, prepay, or to issue other Indebtedness
in exchange or replacement for, such Indebtedness.
“ Refinancing Indebtedness ” means Indebtedness of the Issuer or a Restricted Subsidiary incurred in exchange for, or the proceeds of
which are used to redeem or refinance in whole or in part, any Indebtedness of the Issuer or any Restricted Subsidiary (the “
Refinanced I ndebtedness”); provided that:
(1)
the principal amount (and accreted value, in the case of Indebtedness issued at a discount) of the
Refinancing Indebtedness does not exceed the principal amount (and accreted value, as the case may be) of the Refinanced
Indebtedness plus the amount of accrued and unpaid interest on the Refinanced Indebtedness, any premium paid to the holders
of the Refinanced Indebtedness and expenses incurred in connection with the incurrence of the Refinancing Indebtedness;
(2)
the obligor of Refinancing Indebtedness with respect to any Refinanced Indebtedness of the Issuer or any
Guarantor does not include any Person (other than the Issuer or any Guarantor) that is not an obligor of the Refinanced
Indebtedness;
(3)
if the Refinanced Indebtedness was subordinated in right of payment to the Notes or the Note Guarantees,
as the case may be, then such Refinancing Indebtedness, by its terms, is subordinate in right of payment to the Notes or the
Note Guarantees, as the case may be, at least to the same extent as the Refinanced Indebtedness;
(4)
(5)
Indebtedness being redeemed or refinanced or (b) after the final maturity date of the Notes; and
the Refinancing Indebtedness has a final stated maturity either (a) no earlier than the Refinanced
the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or prior to the final
maturity date of the Notes has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is incurred that
is equal to or greater than the Weighted Average Life to Maturity of the portion of the Refinanced Indebtedness being
redeemed or refinanced that is scheduled to mature on or prior to the
26
final maturity date of the Notes; provided that Refinancing Indebtedness in respect of Refinanced Indebtedness that has no
amortization may provide for amortization installments, sinking fund payments, senior maturity dates or other required
payments of principal of up to 1% of the aggregate principal amount per annum.
“ Registration Rights Agreement ” means (a) with respect to the Initial Notes issued on the Issue Date, the Registration
Rights Agreement dated the Issue Date between the Issuer and the Dealer Managers, and (b) with respect to each issuance of
Additional Notes issued in a transaction exempt from the registration requirements of the Securities Act, the registration rights
agreement, if any, among the Issuer, any Guarantors and the Persons purchasing such Additional Notes under the related purchase
agreement, each as amended, modified or supplemented from time to time.
“ Regulation S ” means Regulation S promulgated under the Securities Act.
“ Regulation S Notes ” means all Notes offered and sold outside the United States in reliance on Regulation S.
“ Related Business ” means any business in which the Issuer or any Restricted Subsidiary was engaged on the Issue Date or any
reasonable extension of such business and any business related, ancillary or complementary to any business of the Issuer or any
Restricted Subsidiary in which the Issuer or any Restricted Subsidiary was engaged on the Issue Date or any reasonable extension of
such business.
“ Responsible Officer ” when used with respect to the Trustee, means an officer or assistant officer assigned to the corporate trust
department of the Trustee (or any successor group of the Trustee) with direct responsibility for the administration of this Indenture
and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his
knowledge of and familiarity with the particular subject.
“ Restricted Note ” has the same meaning as “Restricted Security” set forth in Rule 144(a)(3) promulgated under the Securities Act;
provided that the Trustee shall be entitled to request and conclusively rely upon an Opinion of Counsel with respect to whether any
Note is a Restricted Note.
“ Restricted Payment ” means any of the following:
(1)
the declaration or payment of any dividend or any other distribution on Equity Interests of the Issuer or any
Restricted Subsidiary, including, without limitation, any payment in connection with any merger or consolidation involving
the Issuer but excluding (a) dividends or distributions payable solely in Qualified Equity Interests or through accretion or
accumulation of such dividends on such Equity Interests and (b) dividends or distributions by a Restricted Subsidiary so long
as, in the case of any distribution or dividend payable on or in respect of any class or series of securities issued by a Restricted
Subsidiary other than a Wholly-Owned Restricted Subsidiary, the Issuer
27
or a Restricted Subsidiary receives at least its pro rata share of such dividend or distribution in accordance with its Equity
Interests in such class or series of securities;
(2)
the purchase, redemption, defeasance or other acquisition of any Equity Interests of the Issuer, including,
without limitation, any payment in exchange for such Equity Interests in connection with any merger or consolidation
involving the Issuer but excluding any such Equity Interests held by the Issuer or any Restricted Subsidiary;
(3)
any Investment other than a Permitted Investment; or
(4)
any principal payment or redemption, repurchase, defeasance or other acquisition, in each case prior to the
scheduled maturity or prior to any scheduled repayment of principal or sinking fund payment, as the case may be, in respect of
Subordinated Indebtedness (other than any Subordinated Indebtedness (a) owed to and held by the Issuer or any Restricted
Subsidiary or (b) purchased in anticipation of anticipating of satisfying a sinking fund obligation, principal installment or final
maturity, in each case, due within one year of the date or purchase, repurchase or other acquisition).
“ Restricted Subsidiary ” means any Subsidiary of the Issuer other than an Unrestricted Subsidiary.
“ Rule 144 ” means Rule 144 promulgated under the Securities Act.
“ Rule 144A ” means Rule 144A promulgated under the Securities Act.
“ Rule 144A Notes ” means all Notes offered and sold to QIBs in reliance on Rule 144A.
“ SEC ” means the U.S. Securities and Exchange Commission.
“ Secured Leverage Ratio ” means, as of any date of determination, the ratio of (i) Indebtedness of the Issuer and its Restricted
Subsidiaries secured by a Lien on any assets of the Issuer and its Restricted Subsidiaries as of the last day of the Test Period most
recently ended on or prior to such date of determination (as set forth on the balance sheet and determined on a consolidated basis in
accordance with GAAP but excluding, on and prior to the Separation Date, Indebtedness consisting of guarantees by the Match
Group of Indebtedness of the IAC Group) to (ii) Consolidated Cash Flow for such Test Period, in each case with such pro forma
adjustments to the amount of “Indebtedness” and “Consolidated Cash Flow” as are appropriate and consistent with the pro forma
adjustment provisions set forth in the definition of “Consolidated Cash Flow” and “Consolidated Leverage Ratio”; provided that
solely for purposes of Indebtedness and Liens incurred in connection with the Match Transactions, pro forma effect shall be given to
the acquisition of PlentyofFish Media Inc. described in the Offering Memorandum regardless of whether it has then been
consummated.
The Issuer may elect, pursuant to an Officer’s Certificate delivered to the Trustee, to treat all or any portion of any revolving
commitment under any Indebtedness as being incurred and outstanding at such time and for so long as such revolving commitments
remain outstanding
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(regardless of whether drawn), in which case any subsequent incurrence of Indebtedness under such revolving commitment shall not
be deemed, for purposes of this calculation, to be an incurrence at such subsequent time.
“ Securities Act ” means the U.S. Securities Act of 1933, as amended.
“ Separation Date ” means the date, which shall be promptly following the Issue Date, on which the Issuer is designated as an
“unrestricted subsidiary” under and in accordance with the IAC Credit Agreement and the IAC Notes, as applicable.
“ Shelf Registration Statement ” has the meaning set forth in the Registration Rights Agreement.
“ Significant Subsidiary ” means (1) any Restricted Subsidiary that would be a “significant subsidiary” as defined in Regulation S-X
promulgated pursuant to the Securities Act as such Regulation is in effect on the Issue Date and (2) any Restricted Subsidiary that,
when aggregated with all other Restricted Subsidiaries that are not otherwise Significant Subsidiaries and as to which any event
described in clause (7) or (8) under Section 6.01 has occurred and is continuing, would constitute a Significant Subsidiary under
clause (1) of this definition.
“ Standard & Poor’s ” means Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc. and any successor
to its rating agency business.
“ Subordinated Indebtedness ” means Indebtedness of the Issuer or any Restricted Subsidiary that is expressly subordinated in right of
payment to the Notes or any then-existing Note Guarantees.
“ Subsidiary ” means, with respect to any Person:
(1)
any corporation, limited liability company, association or other business entity of which more than 50% of
the total voting power of the Equity Interests entitled (without regard to the occurrence of any contingency) to vote in the
election of the Board of Directors thereof is at the time owned or controlled, directly or indirectly, by such Person or one or
more of the other Subsidiaries of such Person (or a combination thereof); and
(2)
any partnership (a) the sole general partner or the managing general partner of which is such Person or a
Subsidiary of such Person or (b) the only general partners of which are such Person or one or more Subsidiaries of such
Person (or any combination thereof).
Unless otherwise specified, “Subsidiary” refers to a Subsidiary of the Issuer.
“ Total A ssets” means, as of any date of determination, the total assets of the Issuer and its Restricted Subsidiaries, determined on a
consolidated basis in accordance with GAAP, as set forth on the most recent consolidated balance sheet of the Issuer as of such date
(which calculation shall give pro forma effect to any acquisition or asset sale by the Issuer or any of its Restricted Subsidiaries, in
each case involving the payment or receipt by the Issuer or any of its Restricted Subsidiaries of consideration (whether in the form of
cash or non-cash consideration)
29
in excess of $50.0 million that has occurred since the date of such consolidated balance sheet, as if such acquisition or asset sale had
occurred on the last day of the fiscal period covered by such balance sheet).
“ Transfer Restricted Note ” means any Note that bears or is required to bear the legend set forth in Section 2.16(d) hereto.
“ Trust Indenture Act ” or “TIA” means the Trust Indenture Act of 1939, as amended.
“ Trustee ” means the party named as such in this Indenture until a successor replaces it pursuant to this Indenture and thereafter
means the successor.
“ Unrestricted Subsidiary ” means (1) any Subsidiary that at the time of determination shall be designated an Unrestricted Subsidiary
by the Board of Directors of the Issuer in accordance with Section 4.12, (2) any Subsidiary of an Unrestricted Subsidiary and (3)
Match Financing, LLC.
“ U.S. Government Obligations ” means direct non-callable obligations of, or guaranteed by, the United States of America for the
payment of which guarantee or obligations the full faith and credit of the United States is pledged.
“ USA Patriot Act ” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and
Obstruct Terrorism Act of 2001, Pub. L. No. 107-56.
“ Weighted Average Life to Maturity ” when applied to any Indebtedness at any date, means the number of years obtained by
dividing (1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial
maturity or other required payment of principal, including payment at final maturity, in respect thereof by (b) 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.
“ Wholly-Owned Restricted Subsidiary ” means a Restricted Subsidiary of which 100% of the Equity Interests (except for directors’
qualifying shares or certain minority interests owned by other Persons solely due to local law requirements that there be more than
one stockholder, but which interest is not in excess of what is required for such purpose) are owned directly by the Issuer or through
one or more Wholly-Owned Restricted Subsidiaries and, solely for the purpose of the definition of “Material Domestic Subsidiary”
excluding any Subsidiary whose sole assets are Equity Interests in one or more Subsidiaries that are not Wholly-Owned Subsidiaries.
SECTION 1.02. Other Definitions .
The definitions of the following terms may be found in the sections indicated as follows:
Term Defined in Section
“Affiliate Transaction”................................................... 4.08
“Agent Members” .......................................................... 2.02(c)
“Change of Control Offer”............................................. 4.14
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Term Defined in Section
“Change of Control Payment” .......................................
“Change of Control Payment Date”...............................
“Covenant Defeasance” .................................................
“Designation”.................................................................
“Event of Default” .........................................................
“Exchange Global Note” ...............................................
“Global Notes”...............................................................
“Legal Defeasance” .......................................................
“Leverage Ratio Exception” ..........................................
“Note Guarantee” ..........................................................
“Paying Agent” ..............................................................
“Permitted Indebtedness” ..............................................
“Redesignation” .............................................................
“Registrar” .....................................................................
“Regulation S Global Note”...........................................
“Reversion Date” ..........................................................
“Rule 144A Global Note”..............................................
“Successor” ....................................................................
“Suspended Covenants”.................................................
“Suspension Event” ......................................................
“Suspension Period” .....................................................
4.14
4.14
9.03
4.12
6.01
2.02(b)
2.02(b)
9.02
4.05(a)
10.01
2.04
4.05(b)
4.12
2.04
2.02(b)
4.15
2.02(b)
5.01
4.15
4.15
4.15
SECTION 1.03. Incorporation by Reference of Trust Indenture Act .
Whenever this Indenture refers to a provision of the TIA, the portion of such provision required to be incorporated herein in order for
this Indenture to be qualified under the TIA is incorporated by reference in and made a part of this Indenture.
All TIA terms used in this Indenture that are defined by the TIA, defined in the TIA by reference to another statute or defined by SEC
rule have the meanings therein assigned to them.
SECTION 1.04. Rules of Construction .
Unless the context otherwise requires:
(1)
(2)
(3)
(4)
a term has the meaning assigned to it herein, whether defined expressly or by reference;
“or” is not exclusive;
words in the singular include the plural, and in the plural include the singular;
words used herein implying any gender shall apply to both genders;
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(5)
(6)
particular Article, Section or other Subsection;
“herein,” “hereof” and other words of similar import refer to this Indenture as a whole and not to any
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 as in effect from time to time, applied on a basis consistent with the most recent audited consolidated
financial statements of the Issuer; and
(7)
“$,” “U.S. Dollars” and “United States 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.
ARTICLE TWO THE NOTES
SECTION 2.01. Amount of Notes .
Upon receipt of a written order of the Issuer, the Trustee shall authenticate (i) Initial Notes for original issue on the Issue Date in the
aggregate principal amount not to exceed $445,172,000 and (ii) subject to Section 4.05 (unless terminated pursuant to Section 4.15),
Additional Notes in an unlimited principal amount, upon a written order of the Issuer in the form of an Officer’s Certificate of the
Issuer. The Officer’s Certificate shall specify the amount of the Notes to be authenticated, the date on which the Notes are to be
authenticated, and the names and delivery instructions for each Holder.
(1)
Upon receipt of a written order of the Issuer in the form of an Officer’s Certificate, the Trustee shall authenticate Notes in substitution
for Notes originally issued to reflect any name change of the Issuer. Any Additional Notes and the Exchange Notes shall be part of
the same issue as the Notes being issued on the date hereof and shall vote on all matters as one class with the Notes being issued on
the date hereof, including, without limitation, waivers, amendments, redemptions and offers to purchase. For the purposes of this
Indenture, except for Section 4.05, references to the Notes include Additional Notes and the Exchange Notes, if any; provided , that if
the Additional Notes are not fungible with the Notes for U.S. federal income tax purposes (as reasonably determined by the Issuer),
the Additional Notes will have a separate CUSIP number.
SECTION 2.02. Form and Dating; Book Entry Provisions .
(a)
The (i) Initial Notes and the Trustee’s certificate of authentication with respect thereto and (ii) any
Additional Notes (if issued as Transfer Restricted Notes) and the Trustee’s certificate of authentication shall be substantially in the
form set forth in Exhibit A hereto (other than, with respect to any Additional Notes, changes related to the issue date, issue
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price and first interest payment date of such Additional Notes), which is incorporated in and forms a part of this Indenture. The (i)
Exchange Notes and the Trustee’s certificate of authentication and (ii) any Additional Notes issued other than as Transfer Restricted
Notes and the Trustee’s certificate of authentication shall each be substantially in the form set forth in Exhibit B hereto (other than,
with respect to any Additional Notes, changes related to the issue date, issue price and first interest payment date of such Additional
Notes), which is incorporated in and forms a part of this Indenture. The Notes may have notations, legends or endorsements required
by law, rule or usage to which the Issuer is subject. Each Note shall be dated the date of its authentication.
(b)
(i) The Initial Notes shall be offered and issued by the Issuer pursuant to the Dealer Manager Agreement.
The Notes shall be issued initially only to (i) QIBs in reliance on Rule 144A under the Securities Act and (ii) Persons other than U.S.
Persons (as defined in Regulation S) in reliance on Regulation S under the Securities Act. Notes may thereafter be transferred to,
among others, QIBs and purchasers in reliance on Regulation S, subject to the restrictions on transfer set forth herein. Notes initially
issued pursuant to Rule 144A shall be issued in the form of one or more permanent global Notes in definitive, fully registered form
without interest coupons (collectively, the “ Rule 144A Global N ote”); and Notes initially issued pursuant to Regulation S shall be
issued in the form of one or more global securities in fully registered form (collectively, the “ Regulation S Global Note ”), in each
case without interest coupons and with the global securities legend and the applicable restricted securities legend set forth in Exhibit
A hereto, which shall be deposited on behalf of the purchasers of the Notes represented thereby with the Notes Custodian and
registered in the name of the Depository or a nominee of the Depository, duly executed by the Issuer and authenticated by the Trustee
as provided in this Indenture. Except as set forth in this Section 2.02(b), beneficial ownership interests in the Regulation S Global
Note shall not be exchangeable for interests in the Rule 144A Global Note or any other Note prior to the expiration of the Distribution
Compliance Period and then, after the expiration of the Distribution Compliance Period, may be exchanged for interests in a Rule
144A Global Note only upon certification in form reasonably satisfactory to the Trustee that beneficial ownership interests in such
Regulation S Global Note are owned either by Non-U.S. Persons or U.S. persons who purchased such interests in a transaction that
did not require registration under the Securities Act.
(ii)
Beneficial interests in Regulation S Global Notes may be exchanged for interests in Rule 144A Global
Notes if (1) such exchange occurs in connection with a transfer of Notes in compliance with Rule 144A and (2) the transferor of the
beneficial interest in the Regulation S Global Note first delivers to the Trustee a written certificate (in the form of Exhibit C attached
hereto) to the effect that the beneficial interest in the Regulation S Global Note is being transferred to a Person (A) who the transferor
reasonably believes to be a QIB,
(B) purchasing for its own account or the account of a QIB in a transaction meeting the requirements of Rule 144A, and (C) in
accordance with all applicable securities laws of the States of the United States and other jurisdictions.
(iii)
Beneficial interests in a Rule 144A Global Note may be transferred to a Person who takes delivery in the
form of an interest in a Regulation S Global Note, whether before or after the expiration of the Distribution Compliance Period, only
if the transferor first
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delivers to the Trustee a written certificate (in the form provided in this Indenture) to the effect that such transfer is being made in
accordance with Rule 903 or 904 of Regulation S or Rule 144 (if applicable).
(iv)
Exchange Notes exchanged for interests in the Rule 144A Notes and the Regulation S Notes will be issued
in the form of a permanent global Note, substantially in the form of Exhibit B, which is hereby incorporated by reference and made a
part of this Indenture, deposited with the Registrar as hereinafter provided, including the appropriate legend set forth in Section
2.16(d) (the “ Exchange Global Note ”). The Exchange Global Note will be deposited upon issuance with, or on behalf of, the
Registrar as custodian for DTC, duly executed by the Issuer and authenticated by the Trustee as hereinafter provided. The Exchange
Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount
to be represented by a single certificate.
(v)
The Rule 144A Global Note, the Regulation S Global Note and the Exchange Global Note are collectively
referred to herein as “ Global Notes ”. The aggregate principal amount of the Global Notes 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 hereinafter provided.
(c)
of the Depository.
Book-Entry Provisions . This Section 2.02(c) shall apply only to a Global Note deposited with or on behalf
(i)
The Issuer shall execute and the Trustee shall, in accordance with this Section 2.02(c), authenticate and
deliver initially one or more Global Notes that (A) shall be registered in the name of the Depository for such Global Note or
the nominee of such Depository and (B) shall be delivered by the Trustee to such Depository or pursuant to such Depository’s
instructions or held by the Trustee as custodian for the Depository.
(ii)
Members of, or participants in, the Depository (“ Agent Members ”) shall have no rights under this
Indenture with respect to any Global Note held on their behalf by the Depository or by the Trustee as the custodian of the
Depository or under such Global Note, and the Issuer, the Trustee and any agent of the Issuer or the Trustee shall be entitled
to treat the Depository as the absolute owner of such Global Note 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 of such Depository governing the exercise of the rights of a holder of a
beneficial interest in any Global Note.
interests in Notes shall not be entitled to receive physical delivery of Definitive Notes.
(d)
Definitive Notes . Except as provided in this Section 2.02 or Section 2.16 or 2.17, owners of beneficial
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(e)
The terms and provisions contained in the Notes shall constitute, and are expressly made, a part of this
Indenture and, to the extent applicable, the Issuer, the Guarantors and the Trustee, by their execution and delivery of this Indenture,
expressly agree to such terms and provisions and agree to be bound thereby. If there is any conflict between the terms of the Notes
and this Indenture, the terms of this Indenture shall govern.
(f)
The Notes may be presented for registration of transfer and exchange at the offices of the Registrar.
SECTION 2.03. Execution and Authentication .
An Officer (who shall, in each case, have been duly authorized by all requisite corporate actions) shall sign the Notes for the Issuer by
manual or facsimile signature.
If an Officer whose signature is on a Note was an Officer at the time of such execution but no longer holds that office at the time the
Trustee authenticates the Note, the Note shall be valid nevertheless.
No Note shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such
Note a certificate of authentication substantially in the form provided for herein executed by the Trustee by manual signature of an
authorized officer, and such certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been
duly authenticated and delivered hereunder. Notwithstanding the foregoing, if any Note shall have been authenticated and delivered
hereunder but never issued and sold by the Issuer, and the Issuer shall deliver such Note to the Trustee for cancellation as provided in
Section 2.12, for all purposes of this Indenture such Note shall be deemed never to have been authenticated and delivered hereunder
and shall never be entitled to the benefits of this Indenture.
The Trustee may appoint an authenticating agent reasonably acceptable to the Issuer to authenticate the Notes. Unless otherwise
provided in the appointment, an authenticating agent may authenticate the 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
an Agent to deal with the Issuer and Affiliates of the Issuer. Each Paying Agent is designated as an authenticating agent for purposes
of this Indenture.
The Notes shall be issuable only in registered form without coupons in minimum denominations of $2,000 and integral multiples of
$1,000.
SECTION 2.04. Registrar and Paying Agent .
The Issuer shall maintain an office or agency (which shall be located in the Borough of Manhattan in The City of New York, State of
New York or the city in which the Corporate Trust Office of the Trustee is located) where Notes may be presented for registration of
transfer or for exchange (the “ Registrar ”), and an office or agency where Notes may be presented for payment (the “ Paying Agent
”) and an office or agency where notices and demands to or upon the Issuer, if
35
any, in respect of the Notes and this Indenture may be served. The Registrar shall keep a register of the Notes and of their transfer and
exchange. If and for so long as the Trustee is not the Registrar, the Trustee shall have the right to inspect the register of the Notes
during regular business hours. The Issuer may have one or more additional Paying Agents. The term “Paying Agent” includes any
additional Paying Agent. The Issuer or any Affiliate thereof may act as Paying Agent.
The Issuer shall enter into an appropriate agency agreement, which shall incorporate the provisions of the TIA, with any Agent that is
not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Issuer
shall notify the Trustee of the name and address of any such Agent. If the Issuer fails to maintain a Registrar or Paying Agent, or fails
to give the foregoing notice, the Trustee shall act as such and shall be entitled to appropriate compensation in accordance with Section
7.07. The Issuer or any wholly- owned Subsidiary may act as Paying Agent, Registrar, co-registrar or transfer agent.
The Issuer initially appoints the Trustee as Registrar and Paying Agent. SECTION 2.05. Paying Agent to Hold Money in Trust .
On or prior to each due date of the principal or interest on any Notes, the Issuer shall deposit with the Paying Agent a sum sufficient
to pay such principal and interest when so becoming due. Each Paying Agent shall hold in trust for the benefit of the Holders or the
Trustee all money held by the Paying Agent for the payment of principal of or premium or interest on the Notes (whether such money
has been paid to it by the Issuer or any other obligor on the Notes or the Guarantors), and the Issuer and the Paying Agent shall notify
the Trustee in writing of any default by the Issuer (or any other obligor on the Notes) in making any such payment. If the Issuer or a
Subsidiary of the Issuer serves as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it as a separate trust
fund. Money held in trust by the Paying Agent need not be segregated except as required by law and in no event shall the Paying
Agent be liable for any interest on any money received by it hereunder. The Issuer at any time may require the Paying Agent to pay
all money held by it to the Trustee and account for any funds disbursed and the Trustee may at any time during the continuance of
any Event of Default specified in Section 6.01(1) or (2), upon written request to the Paying Agent, require such Paying Agent to pay
forthwith all money so held by it to the Trustee and to account for any funds disbursed by the Paying Agent. Upon making such
payment, the 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 the Holders and shall otherwise comply with TIA Section 312(a). If the Trustee is not the Registrar, the Issuer shall
furnish to the Trustee at least five Business Days before each Interest Payment Date, and at such other times as the Trustee may
reasonably 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 the Holders and the Issuer shall otherwise comply with TIA Section 312(a).
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SECTION 2.07. Transfer and Exchange .
Subject to Sections 2.02(b), 2.16 and 2.17, when Notes are presented to the Registrar with a request from such Holder to register a
transfer or to exchange them for an equal principal amount of Notes of other authorized denominations, the Registrar shall register the
transfer as requested if the requirements of this Indenture are met. Every Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed or be accompanied by a written instrument of transfer in form satisfactory to the Issuer and the
Registrar, duly executed by the Holder thereof or his attorneys duly authorized in writing. To permit registrations of transfers and
exchanges, the Issuer shall issue and execute and the Trustee shall authenticate new Notes (and the Guarantors shall execute the
guarantee thereon) evidencing such transfer or exchange at the Registrar’s request. No service charge shall be made to the Holder for
any registration of transfer or exchange. The Registrar may require from the Holder payment of a sum sufficient to cover any transfer
taxes or other governmental charge that may be imposed in relation to a transfer or exchange, but this provision shall not apply to any
exchange pursuant to Section 2.11, 3.06, 4.14 or 8.05 (in which events the Issuer shall be responsible for the payment of such taxes).
The Registrar shall not be required to exchange or register a transfer (a) of any Note for a period of 15 days immediately preceding
the mailing of notice of redemption of Notes to be redeemed
(b) of any Note selected, called or being called for redemption except the unredeemed portion of any Note being redeemed in part or
(c) of any Note between a record date and the next succeeding Interest Payment Date.
Any Holder of any Global Note shall, by acceptance of such Global Note, agree that transfers of the beneficial interests in such
Global Note may be effected only through a book entry system maintained by the Holder of such Global Note (or its agent), and that
ownership of a beneficial interest in such Global Note shall be required to be reflected in a book entry.
Each Holder of a Note agrees to indemnify the Issuer and the Trustee against any liability that may result from the transfer, exchange
or assignment of such Holder’s Note in violation of any provision of this Indenture and/or applicable U.S. Federal or state securities
law.
Neither the Trustee nor the Registrar shall have any duty to monitor the Issuer’s compliance with or have any responsibility with
respect to the Issuer’s compliance with any Federal or state securities laws.
SECTION 2.08. Replacement Notes .
If a mutilated Note is surrendered to the Registrar or the Trustee, or if the Holder claims that the Note has been lost, destroyed or
wrongfully taken, the Issuer shall issue and the Trustee shall authenticate a replacement Note (and the Guarantors shall execute the
guarantee thereon) if such Holder furnishes to the Issuer and the Trustee evidence reasonably acceptable to them of the ownership and
the destruction, loss or theft of such Note and if the requirements of Section 8- 405 of the New York Uniform Commercial Code as in
effect on the date of this Indenture are met. If required by the Trustee or the Issuer, an indemnity bond shall be posted by such
Holder, sufficient in the judgment of both to protect the Issuer, the Guarantors, the Trustee or any Paying Agent from any loss that
any of them may suffer if such Note is replaced. The Issuer and the
37
Trustee may charge such Holder for their reasonable out-of-pocket expenses in replacing such Note (including, without limitation,
attorneys’ fees and disbursements) in replacing such Note. Every replacement Note shall constitute a contractual obligation of the
Issuer.
SECTION 2.09. Outstanding Notes .
The Notes outstanding at any time are all Notes that have been authenticated by the Trustee except for (a) those cancelled by it, (b)
those delivered to it for cancellation, (c) to the extent set forth in Sections 9.01 and 9.02, on or after the date on which the conditions
set forth in Section
9.1 or 9.02 have been satisfied, those Notes theretofore authenticated and delivered by the Trustee hereunder and (d) those
described in this Section 2.09 as not outstanding. Subject to Section 2.10, a Note does not cease to be outstanding because the Issuer
or one of its Affiliates holds the Note.
If a Note is replaced pursuant to Section 2.08, it ceases to be outstanding unless the Trustee and the Issuer receives proof satisfactory
to it that the replaced Note is held by a protected purchaser in whose hands such Note is a legal, valid and binding obligation of the
Issuer.
If the Paying Agent holds in trust, in its capacity as such, on any Redemption Date or maturity date, money sufficient to pay all
accrued interest and principal with respect to the Notes payable on that date and is not prohibited from paying such money to the
Holders thereof pursuant to the terms of this Indenture, then on and after that date such Notes cease to be outstanding and interest on
them ceases to accrue.
SECTION 2.10. Treasury Notes .
In determining whether the Holders of the required principal amount of Notes have concurred in any declaration of acceleration or
notice of default or direction, waiver or consent or any amendment, modification or other change to this Indenture, Notes owned by
the Issuer or any other Affiliate of the Issuer shall be disregarded as though they were not outstanding, except that for the purposes of
determining whether the Trustee shall be protected in relying on any such direction, waiver or consent or any amendment,
modification or other change to this Indenture, only Notes as to which a Responsible Officer of the Trustee has received an Officer’s
Certificate stating that such Notes are so owned shall be so disregarded. Notes so owned which have been pledged in good faith shall
not be disregarded if the pledgee established to the satisfaction of the Trustee the pledgee’s right so to act with respect to the Notes
and that the pledgee is not the Issuer, a Guarantor, any other obligor on the Notes or any of their respective Affiliates.
SECTION 2.11. Temporary Notes .
Until definitive Notes are prepared and ready for delivery, the Issuer may prepare and the Trustee shall authenticate temporary Notes.
Temporary Notes shall be substantially in the form of definitive Notes but may have variations that the Issuer considers appropriate
for temporary Notes. Without unreasonable delay, the Issuer shall prepare and the Trustee shall authenticate definitive Notes in
exchange for temporary Notes. Until such exchange, temporary Notes shall be entitled to the same rights, benefits and privileges as
definitive Notes.
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SECTION 2.12. Cancellation .
The Issuer at any time may deliver Notes to the Trustee for cancellation. The Registrar and the 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 cancel and destroy such
Notes in accordance with its customary procedures. The Trustee shall upon the request of the Issuer deliver a certificate of such
destruction to the Issuer. The Issuer may not reissue or resell, or issue new Notes to replace, Notes that the Issuer has redeemed or
paid, or that have been delivered to the Trustee for cancellation, other than in accordance with the express provisions of this
Indenture.
SECTION 2.13. Defaulted Interest .
If the Issuer defaults on a payment of interest on the Notes, it shall pay the defaulted interest, plus (to the extent permitted by law) any
interest payable on the defaulted interest, in accordance with the terms hereof, to the Persons who are Holders of such Notes on a
subsequent special record date, which date shall be at least five Business Days prior to the payment date. The Issuer shall fix such
special record date and payment date in a manner satisfactory to the Trustee. The Issuer shall promptly mail to each Holder of such
Notes a notice that states the special record date, the payment date and the amount of defaulted interest, and interest payable on
defaulted interest, if any, to be paid. The Issuer may make payment of any defaulted interest in any other lawful manner not
inconsistent with the requirements (if applicable) of any securities exchange on which the Notes may be listed and, upon such notice
as may be required by such exchange, if, after written notice given by the Issuer to the Trustee of the proposed payment pursuant to
this sentence, such manner of payment shall be deemed practicable by the Trustee.
SECTION 2.14. CUSIP Number .
The Issuer in issuing the Notes may use a “CUSIP” number, ISIN and “Common Code” number (in each case if then generally in
use), and if so, such CUSIP number, ISIN and Common Code number shall be included in notices of redemption or exchange as a
convenience to Holders; provided that any such notice may state that no representation is made as to the correctness or accuracy of
such number either as printed in the notice or on the Notes, and that reliance may be placed only on the other identification numbers
printed on the Notes. The Issuer shall promptly notify, and in any event within 10 Business Days, the Trustee of any such CUSIP
number, ISIN and Common Code number used by the Issuer in connection with the issuance of the Notes and of any change in the
CUSIP number, ISIN and Common Code number.
SECTION 2.15. Deposit of Moneys .
Subject to the following paragraph, prior to 11:00 a.m., New York City time, on each Interest Payment Date and maturity date, the
Issuer shall have deposited with the Paying Agent in immediately available funds money sufficient to make cash payments, if any,
due on such Interest Payment Date or maturity date, as the case may be. The principal and interest on Global Notes shall be payable
to the Depository or its nominee, as the case may be, as the sole registered
39
owner and the sole holder of the Global Notes represented thereby. The principal and interest on Definitive Notes shall be payable,
either in person or by mail, at the office of the Paying Agent.
If a Holder has given wire transfer instructions to the Issuer at least ten Business Days prior to the applicable Interest Payment Date,
the Issuer (through the Paying Agent) will make all payments on such Holder’s Notes by wire transfer of immediately available funds
to the account specified in those instructions. Otherwise, payments on the Notes will be made at the office or agency of the Paying
Agent for the Notes unless the Issuer (with notice to the Paying Agent) elects to make interest payments by check mailed to the
Holders at their addresses set forth in the register of Holders.
SECTION 2.16. Special Transfer Provisions .
(a) Transfer and Exchange of Definitive Notes . When Definitive Notes are presented to the Registrar with a
request:
(x)
to register the transfer of such Definitive Notes; or
(y)
denominations,
to exchange such Definitive Notes for an equal principal amount of Definitive Notes of other authorized
the Registrar shall register the transfer or make the exchange as requested if its reasonable requirements for such transaction are met;
provided , however , that the Definitive Notes surrendered for transfer or exchange:
(i)
shall be duly endorsed or accompanied by a written instrument of transfer in form reasonably satisfactory to
the Issuer and the Registrar, duly executed by the Holder thereof or its attorney duly authorized in writing; and
(ii)
if such Definitive Notes are required to bear a restricted securities legend, they are being transferred or
exchanged pursuant to an effective registration statement under the Securities Act (and the transferor certifies the same, in
writing, to the Registrar), pursuant to Section 2.16(b) or pursuant to clause (A), (B) or (C) below, and are accompanied by the
following additional information and documents, as applicable:
if such Definitive Notes are being delivered to the Registrar by a Holder for registration in the name
of such Holder, without transfer, a certification from such Holder to that effect; or
if such Definitive Notes are being transferred to the Issuer, a certification to that effect; or
if such Definitive Notes are being transferred (x) pursuant to an exemption from registration in
accordance with Rule 144A, Regulation S or Rule 144 under the Securities Act; or (y) in reliance upon another
exemption from the requirements of the Securities Act: (i) a certification to that effect (in the form set forth on the
reverse of the Note) and (ii) if the Issuer so requests, an opinion of
(A)
(B)
(C)
40
counsel or other evidence reasonably satisfactory to it as to the compliance with the restrictions set forth in the legend
set forth in Section 2.16(d)(i).
(b)
Restrictions on Transfer of a Definitive Note for a Beneficial Interest in a Global Note . A Definitive Note
may not be exchanged for a beneficial interest in a Rule 144A Global Note or a Regulation S Global Note except upon satisfaction of
the requirements set forth below. Upon receipt by the Trustee of a Definitive Note, duly endorsed or accompanied by appropriate
instruments of transfer, in form satisfactory to the Trustee, together with:
(i)
certification, in the form set forth on the reverse of the Note, that such Definitive Note is either (A) being
transferred to a QIB in accordance with Rule 144A or
(B) being transferred after expiration of the Distribution Compliance Period by a Person who initially purchased such Note in
reliance on Regulation S to a buyer who elects to hold its interest in such Note in the form of a beneficial interest in the
Regulation S Global Note; and
(ii)
written instructions directing the Trustee to make, or to direct the Notes Custodian to make, an adjustment
on its books and records with respect to such Rule 144A Global Note (in the case of a transfer pursuant to clause (b)(i)(A)) or
Regulation S Global Note (in the case of a transfer pursuant to clause (b)(i)(C)) to reflect an increase in the aggregate
principal amount of the Notes represented by the Rule 144A Global Note or Regulation S Global Note, as applicable, such
instructions to contain information regarding the Depository account to be credited with such increase,
then the Trustee shall cancel such Definitive Note and cause, or direct the Notes Custodian to cause, in accordance with the standing
instructions and procedures existing between the Depository and the Notes Custodian, the aggregate principal amount of Notes
represented by the Rule 144A Global Note or Regulation S Global Note, as applicable, to be increased by the aggregate principal
amount of the Definitive Note to be exchanged and shall credit or cause to be credited to the account of the Person specified in such
instructions a beneficial interest in the Rule 144A Global Note or Regulation S Global Note, as applicable, equal to the principal
amount of the Definitive Note so canceled. If no Rule 144A Global Notes or Regulation S Global Notes, as applicable, are then
outstanding, the Issuer shall issue and the Trustee shall authenticate, upon written order of the Issuer in the form of an Officer’s
Certificate of the Issuer, a new Rule 144A Global Note or Regulation S Global Note, as applicable, in the appropriate principal
amount.
(c)
Transfer and Exchange of Global Notes .
(i)
The transfer and exchange of Global Notes or beneficial interests therein shall be effected through the
Depository, in accordance with this Indenture (including applicable restrictions on transfer set forth herein, if any) and the procedures
of the Depository therefor. A transferor of a beneficial interest in a Global Note shall deliver to the Registrar a written order given in
accordance with the Depository’s procedures containing information regarding the participant account of the Depository to be
credited with a beneficial interest in such Global Note. The Registrar shall, in accordance with such instructions, instruct the
Depository to credit
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to the account of the Person specified in such instructions a beneficial interest in the Global Note and to debit the account of the
Person making the transfer the beneficial interest in the Global Note being transferred.
(ii)
If the proposed transfer is a transfer of a beneficial interest in one Global Note to a beneficial interest in
another Global Note, the Registrar shall reflect on its books and records the date and an increase in the principal amount of the Global
Note to which such interest is being transferred in an amount equal to the principal amount of the interest to be so transferred, and the
Registrar shall reflect on its books and records the date and a corresponding decrease in the principal amount of the Global Note from
which such interest is being transferred.
(iii)
Notwithstanding any other provisions of Article Two (other than the provisions set forth in Section 2.17), a
Global Note may not be transferred as a whole except by the Depository to a nominee of the Depository or by a nominee of the
Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a successor
Depository or a nominee of such successor Depository.
(iv)
In the event that a Global Note is exchanged for Definitive Notes pursuant to Section 2.17, such Notes may
be exchanged only in accordance with such procedures as are substantially consistent with the provisions of this Section 2.16
(including the certification requirements set forth on the reverse of the Notes intended to ensure that such transfers comply with Rule
144A, Regulation S or another applicable exemption under the Securities Act, as the case may be) and such other procedures as may
from time to time be adopted by the Issuer.
(d)
Legend .
Except as permitted by the following paragraphs (ii), (iii) and (iv), each Note certificate evidencing the
Global Notes (and all Notes issued in exchange therefor or in substitution thereof), in the case of Notes offered otherwise than in
reliance on Regulation S, shall bear a legend in substantially the following form:
(i)
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN
ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST
HEREIN, THE ACQUIRER
(1)
REPRESENTS THAT
(A)
IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL
BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT
EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, OR
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(B)
IT IS NOT A “U.S. PERSON” AND IS OUTSIDE OF THE UNITED STATES (WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT) AND
(2)
AGREES FOR THE BENEFIT OF MATCH GROUP, INC. THAT IT WILL NOT OFFER, SELL,
PLEDGE OR OTHERWISE TRANSFER THIS NOTE OR ANY BENEFICIAL INTEREST HEREIN, EXCEPT IN
ACCORDANCE WITH THE SECURITIES ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES AND ONLY
(A) TO MATCH GROUP, INC.,
(B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER
THE SECURITIES ACT,
(C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT,
(D) IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT,
(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 OF
$250,000, OR
(F) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER
THE SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.
PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (2)(C) ABOVE OR (2)(D) ABOVE, A
DULY COMPLETED AND SIGNED CERTIFICATE (THE FORM OF WHICH MAY BE OBTAINED FROM THE TRUSTEE)
MUST BE DELIVERED TO THE TRUSTEE. PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH
(F) ABOVE, MATCH GROUP, INC. RESERVES THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL OPINIONS,
CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT
THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE
SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY RULE 144 EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
THIS NOTE MAY HAVE BEEN ISSUED WITH ORIGINAL ISSUE DISCOUNT (“OID”) AS DEFINED IN SECTION
1273 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. FOR INFORMATION REGARDING THE ISSUE DATE,
THE ISSUE PRICE, THE YIELD TO MATURITY AND THE AMOUNT OF OID, IF ANY, PER $1.00 OF
43
PRINCIPAL AMOUNT OF THIS NOTE PLEASE CONTACT THE COMPANY AT MATCH GROUP, INC., 555 WEST 18TH
STREET, NEW YORK, NEW YORK 10011, ATTENTION: TREASURER.
Each certificate evidencing a Note offered in reliance on Regulation S shall, in addition to the foregoing, bear a legend in
substantially the following form:
THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION ORIGINALLY EXEMPT
FROM REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”),
AND MAY NOT BE TRANSFERRED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF,
ANY U.S. PERSON EXCEPT PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES LAWS. TERMS USED
ABOVE HAVE THE MEANINGS GIVEN TO THEM IN REGULATION S UNDER THE SECURITIES ACT.
Each Definitive Note shall also bear the following additional legend:
IN CONNECTION WITH ANY TRANSFER, THE HOLDER SHALL 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.
(ii)
Upon any sale or transfer of a Transfer Restricted Note (including any Transfer Restricted Note represented
by a Global Note) pursuant to Rule 144 under the Securities Act, the Registrar shall permit the transferee thereof to exchange such
Transfer Restricted Note for a certificated Note that does not bear the legend set forth above and rescind any restriction on the
transfer of such Transfer Restricted Note, if the transferor thereof certifies in writing to the Registrar that such sale or transfer was
made in reliance on Rule 144 (such certification to be in the form set forth on the reverse of the Note).
(iii)
After a transfer of any Initial Notes during the period of the effectiveness of a Shelf Registration Statement
with respect to such Initial Notes, all requirements pertaining to the restricted securities legend as set forth in Exhibit A hereto, on
such Initial Notes shall cease to apply and the requirements that any such Initial Notes be issued in global form shall continue to
apply.
(iv)
Upon the consummation of an Exchange Offer with respect to the Initial Notes pursuant to which Holders
of such Initial Notes are offered Exchange Notes in exchange for their Initial Notes, all requirements pertaining to Initial Notes that
Initial Notes be issued in global form shall continue to apply, and Exchange Notes in global form without the restricted securities
legend as set forth in Exhibit A hereto, shall be available to Holders that exchange such Initial Notes in such Exchange Offer.
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(e)
Cancellation or Adjustment of Global Note . At such time as all beneficial interests in a Global Note have
either been exchanged for Definitive Notes, redeemed, purchased or canceled, such Global Note shall be returned to the Depository
for cancellation or retained and cancelled by the Trustee. At any time prior to such cancellation, if any beneficial interest in a Global
Note is exchanged for Definitive Notes, redeemed, purchased or canceled, the principal amount of Notes represented by such Global
Note shall be reduced and an adjustment shall be made on the books and records of the Trustee (if it is then the Notes Custodian for
such Global Note) with respect to such Global Note, by the Trustee or the Notes Custodian, to reflect such reduction.
(f)
No Obligation of the Trustee .
(i)
None of the Trustee, Registrar or Paying Agent shall have any responsibility or obligation to any beneficial
owner of a Global Note, a member of, or a participant in the Depository or 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 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 Holders under the Notes shall be given or made only to or
upon the order of 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, Registrar and Paying Agent 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.
Neither the Trustee nor the Registrar 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.
(ii)
SECTION 2.17. Certificated Notes .
(a)
A Global Note deposited with the Depository or with the Trustee as Notes Custodian for the Depository
pursuant to Section 2.02 shall be transferred to the beneficial owners thereof in the form of Definitive Notes in an aggregate principal
amount equal to the principal amount of such Global Note, in exchange for such Global Note, only if such transfer complies with
Section 2.16 hereof and (i) the Depository notifies the Issuer that it is unwilling or unable to continue as Depository for such Global
Note and the Depository fails to appoint a successor depository or if at any time such Depository ceases to be a “clearing agency”
registered under the Exchange Act and, in either case, a successor depositary is not appointed by
45
the Issuer within 90 days of such notice, (ii) the Issuer, at its option, notifies the Trustee in writing that it elects to cause the issuance
of Notes in definitive form, then, upon surrender by the relevant Global Note Holder of its Global Note, Notes in such form will be
issued to each Person that such Global Note Holder and the Depository identifies as being the beneficial owner of the related Notes,
or (iii) an Event of Default has occurred and is continuing with respect to the Notes.
(b)
Any Global Note that is transferable to the beneficial owners thereof pursuant to this Section 2.17 shall be
surrendered by the Depository to the Trustee at the Corporate Trust Office of the Trustee, to be so transferred, in whole or from time
to time in part, without charge, and the Trustee shall authenticate and deliver, upon such transfer of each portion of such Global Note,
an equal aggregate principal amount of Definitive Notes of authorized denominations. Any portion of a Global Note transferred
pursuant to this Section 2.17 shall be executed, authenticated and delivered only in denominations of US$2,000 principal amount or
any integral multiple of US$1,000 in excess thereof and registered in such names as the Depository shall direct. Any Definitive Note
delivered in exchange for an interest in the Transfer Restricted Note shall, except as otherwise provided by Section 2.16(d) hereof,
bear the applicable restricted securities legend and definitive note legend set forth in Exhibit A hereto.
(c)
Subject to the provisions of Section 2.17(b) hereof, the registered Holder of a Global Note shall be entitled
to 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.
(d)
In the event of the occurrence of one of the events specified in Section 2.17(a) hereof, the Issuer shall
promptly make available to the Trustee a reasonable supply of Definitive Notes in definitive, fully registered form without interest
coupons. In the event that the Definitive Notes are not issued to each such beneficial owner promptly after the Registrar has received
a request from the Holder of a Global Note to issue such certificated Note, the Issuer expressly acknowledges, with respect to the
right of any Holder to pursue a remedy pursuant to Article 6 of this Indenture, the right of any beneficial holder of Notes to pursue
such remedy with respect to the portion of the Global Note that represents such beneficial holder’s Notes as if such certificated Notes
had been issued.
(e)
By its acceptance of any Note bearing any legend in Section 2.16(d), each Holder of such Note
acknowledges the restrictions on transfer of such Note set forth in this Indenture and in such legend in Section 2.16(d) and agrees that
it shall transfer such Note only as provided in this Indenture.
The Registrar shall retain for a period of two years copies of all letters, notices and other written communications received pursuant
to Section 2.02 or this Section 2.17. The Issuer shall have the right to inspect and make copies of all such letters, notices or other
written communications at any reasonable time upon the giving of reasonable notice to the Registrar.
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SECTION 2.18. Computation of Interest .
Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months. Additional Interest will be payable
with respect to the Notes in certain circumstances if the Issuer does not consummate the Exchange Offer (or shelf registration, if
applicable) as provided in the Registration Rights Agreement. The Initial Notes will bear interest from (and including) the Issue Date.
ARTICLE THREE REDEMPTION
SECTION 3.01. Election to Redeem; Notices to Trustee .
If the Issuer elects to redeem Notes pursuant to paragraph 6 of such Notes, at least 30 days prior to the Redemption Date (unless a
shorter notice shall be agreed to in writing by the Trustee), the Issuer shall notify the Trustee in writing of the Redemption Date, the
principal amount of Notes to be redeemed and the redemption price, and deliver to the Trustee an Officer’s Certificate stating that
such redemption will comply with the conditions contained in paragraph 6 of the Notes. Notice given to the Trustee pursuant to this
Section 3.01 may not be revoked after the time that notice is given to Holders pursuant to Section 3.03, except as provided in Section
3.04.
SECTION 3.02. Selection by Trustee of Notes To Be Redeemed .
In the event that less than all of the Notes are to be redeemed at any time pursuant to a redemption made pursuant to paragraph 6 of
such Notes, selection of the Notes for redemption shall be made on a pro rata basis (if the Notes are issued in physical form) or in
accordance with DTC’s applicable procedures (if the Notes are issued in global form) and in each case, if the Notes are listed on a
national securities exchange, in compliance with the requirements of the principal national securities exchange on which the Notes
are listed; provided , however , that no Notes of a principal amount of $2,000 or less shall be redeemed in part. If a partial redemption
is made pursuant to paragraph 6 of the Notes, selection of the Notes or portions thereof for redemption shall be made by the Trustee
only on a pro rata basis or on as nearly a pro rata basis as is practicable (subject to the procedures of the Depository), unless that
method is otherwise prohibited. The Trustee shall promptly notify the Issuer of the Notes selected for redemption and, in the case of
any Notes selected for partial redemption, the principal amount thereof to be redeemed. The Trustee may select for redemption
portions of the principal of the Notes that have denominations larger than $2,000. For all purposes of this Indenture unless the context
otherwise requires, provisions of this Indenture that apply to Notes called for redemption also apply to portions of Notes called for
redemption. The Issuer may acquire Notes by means other than redemption, whether pursuant to an Issuer tender offer, open market
purchase or otherwise, provided such acquisition does not otherwise violate the other terms of this Indenture.
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SECTION 3.03. Notice of Redemption .
At least 30 days, and no more than 60 days, before a Redemption Date, the Issuer shall mail, cause to be mailed, or delivered
electronically if held by DTC, notice of redemption to each Holder to be redeemed at his or her last address as the same appears on
the registry books maintained by the Registrar pursuant to Section 2.04, except that redemption notices may be mailed, or delivered
electronically if held by DTC, more than 60 days prior to a Redemption Date if the notice is issued in connection with a satisfaction
and discharge of this Indenture. If the Issuer mails such notice to Holders, it shall mail a copy of such notice to the Trustee at the
same time.
The notice shall identify the Notes to be redeemed (including the CUSIP numbers, ISIN and Common Code numbers, if any thereof)
and shall state:
(1)
the Redemption Date;
(2)
(3)
premium) and accrued interest to be paid;
the redemption price and the amount of premium (or the manner of calculation the redemption price and/or
if any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and
that, after the Redemption Date and upon surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued;
(4)
(5)
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;
(6)
that unless the Issuer defaults in making the redemption payment, interest on Notes called for redemption
ceases to accrue on and after the Redemption Date;
(7)
(8)
that the Notes are being redeemed pursuant to paragraph 6 of the Notes;
the aggregate principal amount of Notes that are being redeemed; and
(9)
if the redemption is conditional, a description of the applicable conditions and the date by which such
conditions are expected to be satisfied.
At the Issuer’s written request made at least five Business Days prior to the date on which notice is to be given (or such shorter period
as the Trustee in its sole discretion may agree), the Trustee shall give the notice of redemption prepared by the Issuer, in the Issuer’s
name and at the Issuer’s sole expense. In such event, the Issuer shall provide the Trustee with the information required by this Section
3.03.
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SECTION 3.04. Effect of Notice of Redemption .
Except as provided below in the next paragraph, once the notice of redemption described in Section 3.03 is mailed, Notes called for
redemption become due and payable on the Redemption Date and at the redemption price, including any premium, plus interest
accrued to the Redemption Date. Upon surrender to the Paying Agent, such Notes shall be paid at the redemption price, including any
premium, plus interest accrued to the Redemption Date, provided that if the Redemption Date is after a regular record date and on or
prior to the Interest Payment Date, the accrued interest shall be payable to the Holder of the redeemed Notes registered on the
relevant record date, and provided , further , that if a Redemption Date is not a Business Day, payment shall be made on the next
succeeding Business Day and no interest shall accrue for the period from such Redemption Date to such succeeding Business Day.
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.
Any redemption or notice may, at the Issuer’s option, be subject to the satisfaction of one or more conditions precedent. In addition, if
such redemption or notice is subject to satisfaction of one or more conditions precedent, such notice shall state that, in the Issuer’s
discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied, or such redemption
may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the
redemption date, or by the Redemption Date so delayed.
The Issuer may provide in any notice that payment of the redemption price and accrued and unpaid interest, if any, and the
performance of the Issuer’s obligations with respect to such redemption may be performed by another Person.
SECTION 3.05. Deposit of Redemption Price .
On or prior to 11:00 a.m., New York City time, on each Redemption Date, the Issuer shall deposit with the Paying Agent in
immediately available funds money sufficient to pay the redemption price of, including premium, if any, and accrued interest on all
Notes to be redeemed on that date other than Notes or portions thereof called for redemption on that date which have been delivered
by the Issuer to the Trustee for cancellation. Promptly after the calculation of the redemption price, the Issuer shall give the Trustee
and any Paying Agent written notice thereof.
On and after any Redemption Date, if money sufficient to pay the redemption price of, including premium, if any, and accrued
interest on Notes called for redemption shall have been made available in accordance with the preceding paragraph, the Notes called
for redemption shall cease to accrue interest and the only right of the Holders of such Notes shall be to receive payment of the
redemption price of and, subject to the first proviso in Section 3.04, accrued and unpaid interest on such Notes to the Redemption
Date. If any Note surrendered for redemption shall not be so paid, interest shall be paid, from the Redemption Date until such
redemption payment is made, on the unpaid principal of the Note and any interest not paid on such unpaid principal, in each case, at
the rate and in the manner provided in the Notes.
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SECTION 3.06. Notes Redeemed in Part .
Upon surrender of a Note that is redeemed in part, the Issuer shall execute and the Trustee shall authenticate for the Holder thereof a
new Note equal in principal amount to the unredeemed portion of the Note surrendered.
SECTION 3.07. Mandatory Redemption .
Except as set forth in Section 4.14, the Issuer shall not be required to make mandatory redemption payments with respect to the
Notes.
ARTICLE FOUR COVENANTS
SECTION 4.01. Payment of Notes .
The Issuer shall pay the principal of and interest on the Notes on the dates and in the manner provided in the Notes and this Indenture.
An installment of principal or interest shall be considered paid on the date it is due if the Trustee or Paying Agent holds by 11:00 a.m.
on that date money designated for and sufficient to pay such installment.
The Issuer shall pay interest on overdue principal (including post-petition interest in a proceeding under any Bankruptcy Law), and
overdue interest, to the extent lawful, at the rate specified in the Notes.
SECTION 4.02. Reports to Holders .
(a)
Notwithstanding that the Issuer may not be subject to the reporting requirements of Section 13 or 15(d) of
the Exchange Act or otherwise report on an annual and quarterly basis on forms provided for such annual and quarterly reporting
pursuant to rules and regulations promulgated by the SEC, the Issuer will file with the SEC (and make available to the Trustee and
Holders of the Notes, without cost to any Holder, within 15 days after it files (or is otherwise required to file) them with the SEC)
from and after the Issue Date,
(1)
within 90 days (or any other time period then in effect under the rules and regulations of the Exchange Act
with respect to the filing of a Form 10-K by a non- accelerated filer) after the end of each fiscal year, annual reports on Form
10-K, or any successor or comparable form, containing the information required to be contained therein, or required in such
successor or comparable form;
(2)
within 45 days after the end of each of the first three fiscal quarters of each fiscal year, reports on Form 10-
Q containing all quarterly information that would be required to be contained in Form 10-Q, or any successor or comparable
form;
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(3)
(4)
promptly from time to time after the occurrence of an event required to be therein reported, such other
reports on Form 8-K, or any successor or comparable form; and
any other information, documents and other reports which the Issuer would be required to file with the SEC
if it were subject to Section 13 or 15(d) of the Exchange Act;
in each case in a manner that complies in all material respects with the requirements specified in such form; provided that the
Issuer shall not be so obligated to file such reports with the SEC if the SEC does not permit such filing, in which event the Issuer will
make available such information to prospective purchasers of Notes, in addition to providing such information to the Trustee and the
Holders of the Notes, in each case within l5 days after the time the Issuer would be required to file such information with the SEC if it
were subject to Section 13 or 15(d) of the Exchange Act. In addition, to the extent not satisfied by the foregoing, the Issuer will agree
that, for so long as any Notes are outstanding, it will furnish to Holders and to securities analysts and prospective investors, upon their
request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.
(b)
Notwithstanding the foregoing, such requirements shall be deemed satisfied for any particular period or
report prior to the commencement of the exchange offer or the effectiveness of the shelf registration statement described in the
Registration Rights Agreement (1) by the filing with the SEC of the exchange offer registration statement or shelf registration
statement (or any other registration statement, including a registration statement on Form S-1), and any amendments thereto, with
such financial information that satisfies Regulation S-X, subject to exceptions consistent with the presentation of financial
information in the Offering Memorandum, to the extent filed within the times specified above, or (2) by posting reports that would be
required to be filed substantially in the form required by the SEC on the Issuer’s website and providing such reports to the Trustee
within 15 days after the time the Issuer would be required to file such information with the SEC if it were subject to Section 13 or
15(d) of the Exchange Act, with such financial information (including a “Management’s discussion and analysis of results of
operations and financial condition” section) that would be required to be included in such reports, subject to exceptions consistent
with the presentation of financial information in the Offering Memorandum, to the extent filed within the times specified above.
(c)
Delivery of such reports and information to the Trustee shall be for informational purposes only and the
Trustee’s receipt of them shall not constitute 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 is entitled to rely exclusively on an Officer’s Certificate).
SECTION 4.03. Waiver of Stay, Extension or Usury Laws .
Each of the Issuer and the Guarantors covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, or
plead (as a defense or otherwise) or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or
any usury law
51
or other law which would prohibit or forgive any of the Issuer and the Guarantors from paying all or any portion of the principal of,
premium, if any, and/or interest on the Notes as contemplated herein, wherever enacted, now or at any time hereafter in force, or
which may affect the covenants or the performance of this Indenture; and (to the extent that they may lawfully do so) each of the
Issuer and the Guarantors hereby expressly waives all benefit or advantage of any such law, and covenants that it 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.
SECTION 4.04. Compliance Certificate; Notice of Default .
(a)
The Issuer shall deliver to the Trustee, within 120 days after the end of each fiscal year, an Officer’s
Certificate stating that a review of the activities of the Issuer and its Subsidiaries during such fiscal year has been made under the
supervision of the signing Officers with a view to determining whether the Issuer and the Guarantors have kept, observed, performed
and fulfilled their obligations under this Indenture, and further stating, as to each such Officer signing such certificate, that to the best
of his or her knowledge, the Issuer and the Guarantors have kept, observed, performed and fulfilled each and every covenant
contained in this Indenture and no Default occurred during such period (or, if a Default shall have occurred, describing all such
Defaults of which he or she may have knowledge and what action they are taking or propose to take with respect thereto).
The Issuer and the Guarantors shall, so long as any of the Notes are outstanding, deliver to the Trustee,
forthwith upon any Officer becoming aware of any Default, an Officer’s Certificate specifying such Default and what action the
Issuer and the Guarantors are taking or propose to take with respect thereto.
(b)
SECTION 4.05. Limitations on Incurrence of Indebtedness .
(a)
The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, incur any
Indebtedness; provided that the Issuer or any Guarantor may incur additional Indebtedness, in each case, if, as of the date of
incurrence, after giving effect to such incurrence and the application of the proceeds therefrom, the Consolidated Leverage Test
would be satisfied (the “ Leverage Ratio Exception ”).
(b)
Notwithstanding the above, each of the following shall be permitted (the “ Permitted Indebtedness ”):
(1)
Indebtedness of the Issuer and any Restricted Subsidiary under Credit Facilities (including the Credit
Agreement) in an aggregate principal amount at any time outstanding not to exceed the sum of (x) $1,300.0 million plus (y)
any additional aggregate principal amount of Indebtedness that at the time of incurrence does not cause the Secured Leverage
Ratio for the Issuer for the Test Period immediately preceding the date of incurrence after giving effect to such incurrence and
the application of the proceeds therefrom to exceed 4.00 to 1.00; provided that any Indebtedness incurred under
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this clause (1) shall be deemed to be secured Indebtedness for purposes of calculating the Secured Leverage Ratio;
the Notes (other than Additional Notes) and any related Note Guarantees and the Exchange Notes or
guarantees related thereto;
(2)
(3)
than Indebtedness referred to in clause (1), (2) or (4));
Indebtedness of the Issuer and the Restricted Subsidiaries to the extent outstanding on the Issue Date (other
(4)
(x) Indebtedness of the Issuer owed to any Restricted Subsidiary or of a Restricted Subsidiary owed to any
other Restricted Subsidiary or the Issuer and (y) guarantees by any Restricted Subsidiary or the Issuer of any Indebtedness of
the Issuer or any other Restricted Subsidiary; provided, however, that if such Indebtedness is owed by the Issuer or a Guarantor
to a non-Guarantor it is subordinated in right of payment to the Notes; provided, further, however, that upon any such
Indebtedness being owed to any Person other than the Issuer or a Restricted Subsidiary or any such guarantee being of
Indebtedness of any Person other than the Issuer or a Restricted Subsidiary, as applicable, the Issuer or such Restricted
Subsidiary, as applicable, shall be deemed to have incurred Indebtedness not permitted by this clause (4);
(5)
Indebtedness in respect of bid, performance, surety bonds or completion bonds issued for the account of the
Issuer or any Restricted Subsidiary in the ordinary course of business, including guarantees or obligations of the Issuer or any
Restricted Subsidiary with respect to letters of credit supporting such bid, performance, surety or completion obligations;
(6)
Purchase Money Indebtedness or Capitalized Lease Obligations incurred by the Issuer or any Restricted
Subsidiary, and Refinancing Indebtedness thereof, in an aggregate amount not to exceed at any time outstanding the greater of
$50.0 million or 2.0% of Total Assets as of the time of incurrence;
(7)
Indebtedness arising (A) from the honoring by a bank or other financial institution of a check, draft or
similar instrument drawn against insufficient funds in the ordinary course of business; provided , however , that such
Indebtedness is extinguished within five Business Days of incurrence or (B) under any customary cash pooling or cash
management agreement with a bank or other financial institution in the ordinary course of business or (C) pursuant to any
treasury transaction in the ordinary course of business;
(8)
business;
Indebtedness arising in connection with endorsement of instruments for deposit in the ordinary course of
(9)
Refinancing Indebtedness with respect to Indebtedness incurred pursuant to the Leverage Ratio Exception or
clause (1)(y), (2), (3) or (6) above, this clause (9) or clause (11) or (12) below;
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(10)
indemnification, adjustment of purchase price, deferred purchase price, contingent consideration or other
compensation or similar obligations, in each case, incurred or assumed in connection with the making of any Permitted
Investment or the acquisition or disposition of any business or assets of the Issuer or any Restricted Subsidiary or Equity
Interests of a Restricted Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion
of such business, assets or Equity Interests for the purpose of financing or in contemplation of any such acquisition; provided
that in the case of a disposition, the maximum aggregate liability in respect of all such obligations incurred or assumed in
connection with such disposition outstanding under this clause (10) shall at no time exceed the gross proceeds (including Fair
Market Value of non-cash proceeds measured at the time such non-cash proceeds are received) actually received by the Issuer
and its Restricted Subsidiaries in connection with such disposition;
(11)
Indebtedness of Subsidiaries that are not Guarantors if, after giving effect to such incurrence and the
application of the proceeds thereof, the aggregate principal amount of such indebtedness at any time outstanding and
Refinancing Indebtedness thereof does not exceed the greater of $100.0 million and 4.0% of Total Assets as of the time of
incurrence (less the amount of any Indebtedness secured by a Lien permitted under clause (26) of the definition of “Permitted
Liens” which Indebtedness is not incurred pursuant to this clause (11));
(12)
Acquired Indebtedness; provided that the Issuer would be permitted to incur an additional $1.00 of
Indebtedness under the Consolidated Leverage Test or the Consolidated Leverage Ratio for the Issuer and its Restricted
Subsidiaries, calculated after giving effect to such incurrence and on a pro forma basis, would be less than or equal to the
Consolidated Leverage Ratio for the Issuer and its Restricted Subsidiaries immediately prior to such transaction;
(13)
guarantees by the Issuer or any Restricted Subsidiary of any Indebtedness that it is otherwise permitted to
incur pursuant to clauses (1) to (12) above and clauses
(14) and (25) below;
(14)
Indebtedness of the Issuer or any Restricted Subsidiary in an aggregate amount not to exceed at any time
outstanding the greater of $50.0 million and 2.0% of Total Assets as of the time of incurrence;
(15)
Indebtedness representing deferred compensation incurred in the ordinary course of business;
(16)
Indebtedness supported by a letter of credit, bank guarantee or similar instrument, in principal amount not
in excess of the stated amount of such letter of credit, bank guarantee or similar instrument;
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(17)
any Indebtedness in respect of sale and leaseback transactions in an aggregate amount at any time
outstanding not to exceed the greater of $25.0 million and 1.0% of Total Assets as of the time of incurrence;
(18)
the disposition of accounts receivable in connection with receivables factoring arrangements in the
ordinary course of business;
(19)
Indebtedness of the Issuer or any Restricted Subsidiary consisting of obligations for the payment of letters
of credit in commitment amounts not to exceed
$10.0 million in the aggregate at any one time outstanding, excluding commitment amounts for any letters of credit issued
pursuant to the Credit Facilities;
(20)
any guarantee by the Issuer or any of its Restricted Subsidiaries, in the ordinary course of business, of
obligations of suppliers, customers, franchisees and licensees of the Issuer or any of its Restricted Subsidiaries;
(21)
unsecured Indebtedness in respect of obligations of the Issuer or any of its Restricted Subsidiaries to pay
the deferred purchase price of goods or services or progress payments in connection with such goods and services; provided
that such obligations are incurred in connection with open accounts extended by suppliers on customary trade terms (which
require that all such payments be made within 60 days after the incurrence of the related obligations) in the ordinary course of
business and not in connection with the borrowing of money;
(22)
reimbursement obligations with respect to letters of credit, bank guarantees, warehouse receipts or similar
instruments issued in the ordinary course of business, and Indebtedness of the Issuer in respect of letters of credit issued by the
Issuer for its own account or for the account of any of its Restricted Subsidiaries;
(23)
guarantees of obligations of IAC under the IAC Credit Agreement and the IAC Notes until the Separation
Date;
(24)
any Pre-IPO Notes; and
(25)
to the extent constituting Indebtedness, the Match Transactions.
For purposes of determining compliance with this Section 4.05, in the event that an item of Indebtedness meets the criteria of more
than one of the categories of Permitted Indebtedness described in clauses (1) through (25) above or is entitled to be incurred pursuant
to the Leverage Ratio Exception, the Issuer shall, in its sole discretion, classify such item of Indebtedness and may divide, classify
and later reclassify such Indebtedness in more than one of the types of Indebtedness described above ( provided that at the time of
reclassification it meets the criteria in such category or categories), except that Indebtedness outstanding on the Issue Date (i)
constituting an “Escrow Incremental Term Loan” as defined in the Credit Agreement or (ii) under the Credit Agreement shall be
deemed to have been incurred under clause (1) when assumed by the Issuer or on the Issue Date, as applicable, with the first up to
$800.0 million of
55
such Indebtedness being deemed incurred under clause (1)(x) and any additional amounts of such Indebtedness being deemed
incurred under clause (1)(y) and the Notes issued on the Issue Date (and any Exchange Notes and guarantees thereof) shall be deemed
to have been incurred under clause (2) above. In addition, for purposes of determining any particular amount of Indebtedness under
this Section 4.05, guarantees, Liens or letter of credit obligations supporting Indebtedness otherwise included in the determination of
such particular amount shall not be included so long as incurred by a Person that could have incurred such Indebtedness.
For purposes of determining compliance with any U.S. dollar-denominated restriction on the incurrence of Indebtedness, the U.S.
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 U.S. 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 U.S.
dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such
refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the Indebtedness
represented by such guarantees, Liens or letter of credit obligations was incurred in compliance with this Section 4.05. Accrual of
interest, the accretion of accreted value, the accretion or amortization of original issue discount and the payment of interest in the
form of additional Indebtedness of the same class will not be deemed to be an incurrence of Indebtedness for purposes of this
covenant.
SECTION 4.06. Limitations on Restricted Payments .
The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, make any Restricted Payment unless at the
time of such Restricted Payment:
(1)
(2)
no Default shall have occurred and be continuing or shall occur as a consequence thereof; and
after making such Restricted Payment the Consolidated Leverage Test would be satisfied.
The foregoing provisions will not prohibit:
(1)
the payment by the Issuer or any Restricted Subsidiary of any dividend or the consummation of any
irrevocable redemption within 60 days after the date of declaration thereof or giving the notice of the redemption, if on the
date of declaration or notice the payment would have complied with the provisions of this Indenture (assuming, in the case of
redemption, the giving of the notice would have been deemed to be a Restricted Payment at such time and such deemed
Restricted Payment would have been permitted at such time);
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(2)
(3)
substantially concurrent issuance and sale of, Qualified Equity Interests;
the redemption of any Equity Interests of the Issuer in exchange for, or out of the proceeds of the
the purchase, repurchase, redemption, defeasance, retirement for value or other acquisition of Subordinated
Indebtedness of the Issuer or any Restricted Subsidiary
(a) in exchange for, or out of the proceeds of the issuance and sale of Qualified Equity Interests within the preceding six
months, (b) in exchange for, or out of the proceeds of the substantially concurrent incurrence of, Refinancing Indebtedness
permitted to be incurred under Section 4.05 and the other terms of this Indenture, (c) upon a Change of Control or in
connection with a sale of assets to the extent required by the agreement governing such Subordinated Indebtedness but only if
the Issuer shall have complied with Section 4.14 (to the extent applicable) and purchased all Notes validly tendered pursuant
to the relevant offer prior to redeeming such Subordinated Indebtedness or (d) deemed to occur as a result of the conversion of
all or a portion of such Subordinated Indebtedness into Equity Interests of the Issuer;
(4)
repurchase, redemption or other acquisition for value by the Issuer of, Equity Interests of the Issuer held by
officers, directors or employees or former officers, directors or employees of the Issuer and any Restricted Subsidiary (or their
transferees, estates or beneficiaries under their estates), upon their death, disability, retirement, severance or termination of
employment or service; provided that the aggregate cash consideration paid for all such redemptions shall not exceed $10.0
million during any twelve consecutive months (with unused amounts in any period being carried over to succeeding periods);
provided , further , that cancellation of Indebtedness owing to the Issuer or any Restricted Subsidiary from any current or
former officer, director or employee (or any permitted transferees thereof) of the Issuer or any of its Restricted Subsidiaries
(or any direct or indirect parent company thereof), in connection with a repurchase of Equity Interests of the Issuer from such
Persons will not be deemed to constitute a Restricted Payment for purposes of this covenant or any other provisions of this
Indenture;
(5)
repurchases of Equity Interests deemed to occur (a) upon the exercise of stock options, warrants, or similar
rights if the Equity Interests represent all or a portion of the exercise price thereof or (b) in connection with the satisfaction of
any withholding tax obligations incurred relating to the vesting or exercise of stock options, warrants, restricted stock units or
similar rights;
(6)
any Restricted Payment made out of the net cash proceeds of the substantially concurrent sale of, or made
by exchange for, Qualified Equity Interests of the Issuer (other than Qualified Equity Interests issued or sold to a Restricted
Subsidiary of the Issuer or an employee stock ownership plan or to a trust established by the Issuer or any of its Restricted
Subsidiaries for the benefit of their employees) or a substantially concurrent cash capital contribution received by the Issuer
from its stockholders;
57
(7)
(8)
or former directors, management, employees or consultants of the Issuer and its Restricted Subsidiaries;
Restricted Payments pursuant to and in accordance with stock option plans or other benefit plans for current
payments or distributions to dissenting stockholders pursuant to applicable law, pursuant to or in
connection with a consolidation, merger or transfer of all or substantially all of the assets of the Issuer and its Restricted
Subsidiaries that complies with the provisions of
Section 5.01; provided that, as a result of such consolidation, merger or transfer of assets, the Issuer has made or will make a
Change of Control Offer pursuant to Section 4.14 (if required) and any notes tendered in connection therewith have been or
will be repurchased;
(9)
other Restricted Payments not otherwise permitted under this Indenture in an aggregate amount from and
after the Issue Date not to exceed the greater of $50.0 million or 2.0% of Total Assets, calculated as of the date on which any
Restricted Payment pursuant to this clause (9) is made;
(10)
Distributions; and
Restricted Payments made in connection with the Match Transactions, including the Match Transaction
(11)
Restricted Payments to any member of the IAC Group that is a direct or indirect parent of the Issuer:
(a)
the proceeds of which will be used to pay the consolidated, combined or similar income tax liability
of such parent’s income tax group that is attributable to the income of the Issuer or its Subsidiaries; provided that (x)
no such payments with respect to any taxable year shall exceed the amount of such income tax liability that would
have been imposed on the Issuer and/or the applicable Subsidiaries had such entity(ies) filed on a stand-alone basis
and (y) any such payments attributable to an Unrestricted Subsidiary shall be limited to the amount of any cash paid by
such Unrestricted Subsidiary to the Issuer or any Restricted Subsidiary for such purpose; and
(b)
Permitted Parent Payments;
provided that in the case of any Restricted Payment pursuant to clause (3) or (7) above, no Default shall have occurred and be
continuing or occur as a consequence thereof.
For purposes of this covenant, if a particular Restricted Payment involves a non-cash payment, including a distribution of assets, then
such Restricted Payment shall be deemed to be an amount equal to the cash portion of such Restricted Payment, if any, plus an
amount equal to the Fair Market Value of the non-cash portion of such Restricted Payment. In addition, for purposes of determining
compliance with this covenant, in the event that a Restricted Payment meets the criteria of more than one of the types of Restricted
Payments described above, the Issuer may order and classify, and from time to time may reclassify, such Restricted Payment if that
58
classification would have been permitted at the time such Restricted Payment was made or at the time of the reclassification.
SECTION 4.07. Limitations on Asset Sales .
The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, consummate any Asset Sale unless at the
time of such transaction and after giving effect thereto and to the use of proceeds thereof, (a) no Default shall have occurred and be
continuing, (b) the Issuer or such Restricted Subsidiary, as the case may be, receives consideration at least equal to the Fair Market
Value of the assets sold or otherwise disposed of, and (c) in the case of an Asset Sale other than an Asset Swap, at least 75% of the
consideration therefor 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:
(1)
any liabilities (as reflected in the Issuer’s or such Restricted Subsidiary’s most recent balance sheet or in the
footnotes thereto, or if incurred or accrued 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 accrual had
taken place on the date of such balance sheet) of the Issuer or such Restricted Subsidiary, other than liabilities that are by their
terms expressly subordinated in right of payment to the Notes, that are assumed by the transferee of any such assets and for
which the Issuer and all of its Restricted Subsidiaries have been validly released by all creditors in writing,
(2)
any securities, notes or other similar obligations received by the Issuer or such Restricted Subsidiary from
such transferee that are converted by the Issuer or such Restricted Subsidiary into cash or Cash Equivalents (to the extent so
converted) within 180 days following the closing of such Asset Sale, and
(3)
any Designated Non-Cash Consideration received by the Issuer or any Restricted Subsidiary in such Asset
Sale having an aggregate Fair Market Value, taken together with all other Designated Non-Cash Consideration received
pursuant to this clause (3) that is at that time outstanding, not to exceed an amount equal to the greater of $100.0 million and
3.0% of Total Assets at the time of the receipt of such Designated Non-Cash Consideration, 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 be deemed to be cash or Cash Equivalents for purposes of this provision and for no other purpose.
SECTION 4.08. Limitations on Transactions with Affiliates .
The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, in one transaction or a series of related
transactions, sell, lease, transfer or otherwise dispose of any of its assets to, or purchase any assets from, or enter into any contract,
agreement, loan, advance or guarantee with, or for the benefit of, any Affiliate involving payment or consideration in excess of $5.0
million (an “ Affiliate Transac tion”), unless, as determined by the Issuer, such Affiliate
59
Transaction is on terms that are no less favorable to the Issuer or the relevant Restricted Subsidiary than those that would have been
obtained in a comparable transaction at such time on an arm’s-length basis by the Issuer or that Restricted Subsidiary from a Person
that is not an Affiliate of the Issuer or that Restricted Subsidiary.
The foregoing restrictions shall not apply to:
(1)
transactions between or among the Issuer and its Restricted Subsidiaries not involving any other Affiliate;
(2)
as determined by the Issuer, reasonable director, officer and employee compensation (including bonuses)
and other benefits (including retirement, health, and stock compensation plans) and indemnification arrangements and
performance of such arrangements;
(3)
any issuance of securities, or other payments, awards or grants in cash, securities or otherwise, in each case
pursuant to, or the funding of, employment arrangements, stock options and stock ownership plans in the ordinary course of
business;
(4)
(5)
Permitted Investments;
Restricted Payments which are made in accordance with Section 4.06;
(6)
(x) any agreement or arrangement in effect on the Issue Date, as in effect on the Issue Date or as thereafter
amended or replaced in any manner, that, taken as a whole, is not more disadvantageous to the Holders or the Issuer in any
material respect than such agreement or arrangement as it was in effect on the Issue Date (as determined in good faith by the
Issuer) or (y) any transaction pursuant to any agreement or arrangement referred to in the immediately preceding clause (x);
(7)
any transaction with a joint venture or similar entity which would constitute an Affiliate Transaction solely
because the Issuer or a Restricted Subsidiary owns an Equity Interest in or otherwise controls such joint venture or similar
entity;
(8)
ordinary overhead arrangements in which any Subsidiary participates;
(9)
(a) any transaction with an Affiliate where the only consideration paid by the Issuer or any Restricted
Subsidiary is Qualified Equity Interests or (b) the issuance or sale of any Qualified Equity Interests;
(10)
any transaction entered into by a Person prior to the time such Person becomes a Restricted Subsidiary or is
merged or consolidated into the Issuer or a Restricted Subsidiary;
(11)
the issuance or sale of any Qualified Equity Interest of the Issuer to any Person;
60
(12)
any employment agreements entered into by the Issuer or any of its Restricted Subsidiaries in the ordinary
course of business and the transactions pursuant thereto; and
(13)
any transactions made in connection with, or pursuant to agreements entered into in connection with, the
Match Transactions and any amendment or replacement thereof in any manner, that, taken as a whole, is not more
disadvantageous to the Issuer in any material respect than such agreement or arrangement (as determined in good faith by the
Issuer).
SECTION 4.09. Limitations on Liens .
The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, create, incur, assume or
permit or suffer to exist any Lien (other than Permitted Liens) of any nature whatsoever against any assets (including Equity Interests
of a Restricted Subsidiary) of the Issuer or any Restricted Subsidiary, whether owned at the Issue Date or thereafter acquired, which
Lien secures Indebtedness or Hedging Obligations unless:
(1)
in the case of Liens securing Indebtedness that is Subordinated Indebtedness, the Notes or the Note
Guarantee of such Restricted Subsidiary, if any, are secured by a Lien on such assets that is senior in priority to such Liens;
and
(2)
in all other cases, the Notes or the Note Guarantee of such Restricted Subsidiary, if any, are secured equally
and ratably with or prior to such Liens;
provided that any Lien which is granted to secure the Notes or any Note Guarantee under this covenant shall be discharged at the
same time as the discharge of the Lien that gave rise to the obligation to so secure the Notes or such Note Guarantee, as the case may
be.
SECTION 4.10. Future Note Guarantees .
If, after the Issue Date, (a) any Restricted Subsidiary (including any newly formed, newly acquired or newly Redesignated Restricted
Subsidiary) incurs any Indebtedness or guarantees any Indebtedness of the Issuer or a Domestic Subsidiary in either case in reliance
on the Leverage Ratio Exception or (b) the Issuer otherwise elects to have any Restricted Subsidiary become a Guarantor, then, in
each such case, the Issuer shall cause such Restricted Subsidiary to:
(1)
execute and deliver to the Trustee (a) a supplemental indenture in form and substance satisfactory to the
Trustee pursuant to which such Restricted Subsidiary shall unconditionally guarantee all of the Issuer’s obligations under the
Notes and this Indenture and (b) a notation of guarantee in respect of its Note Guarantee; and
(2)
deliver to the Trustee one or more opinions of counsel that such supplemental indenture (a) has been duly
authorized, executed and delivered by such Restricted Subsidiary and (b) constitutes a valid and legally binding obligation of
such Restricted Subsidiary in accordance with its terms (subject to customary qualifications).
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SECTION 4.11.
Limitations on Dividend and Other Restrictions Affecting Restricted Subsidiaries.
The Issuer shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or permit to
exist or become effective any consensual encumbrance or consensual restriction on the ability of any Restricted Subsidiary to:
Restricted Subsidiary;
(a)
(b)
(c)
except for:
pay dividends or make any other distributions on or in respect of its Equity Interests held by the Issuer or a
make loans or advances or pay any Indebtedness or other obligation owed to the Issuer or any Guarantor; or
transfer any of its assets to the Issuer or any Guarantor;
(1)
encumbrances or restrictions existing under or by reason of applicable law, regulation or order;
(2)
encumbrances or restrictions existing under this Indenture, the Notes, the Note Guarantees and Exchange
Notes (and any guarantees thereof);
(3)
non-assignment provisions of any contract or any lease entered into in the ordinary course of business;
(4)
(5)
(6)
(7)
limitation, the Credit Agreement) as in effect on that date;
encumbrances or restrictions existing under agreements existing on the Issue Date (including, without
such Lien that limit the right of the relevant obligor to transfer assets that are subject to such Lien;
encumbrances or restrictions relating to any Lien permitted under this Indenture imposed by the holder of
Interests of such Restricted Subsidiary, permitted under this Indenture to any Person pending the closing of such sale;
encumbrances or restrictions imposed under any agreement to sell assets, including Qualified Equity
any instrument or agreement governing Acquired Indebtedness, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than the Person or the properties or assets of the
Person so acquired;
(8)
any other instrument or agreement entered into after the Issue Date that contains encumbrances and
restrictions that, as determined by the Issuer, will not materially adversely affect the Issuer’s ability to make principal or
interest payments on the Notes;
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(9)
customary provisions in partnership agreements, limited liability company organizational governance
documents, joint venture agreements, shareholder agreements and other similar agreements;
(10)
Purchase Money Indebtedness or Capitalized Lease Obligations incurred in compliance with Section 4.05
that impose restrictions of the nature described in clause (c) above on the assets acquired;
(11)
encumbrances or restrictions on cash or other deposits or net worth imposed by suppliers, customers or
landlords under contracts entered into in the ordinary course of business;
(12)
with respect to clause (c) only, any encumbrance or restriction consisting of customary nonassignment
provisions in leases governing leasehold interests, licenses, joint venture agreements and agreements similar to any of the
foregoing to the extent such provisions restrict the transfer of the property subject to such leases, licenses, joint venture
agreements or similar agreements;
(13)
with respect to clause (c) only, any encumbrance or restriction contained in security agreements or
mortgages securing Indebtedness of a Restricted Subsidiary to the extent such encumbrance or restriction restricts the transfer
of the property subject to such security agreements or mortgages;
(14)
any encumbrances or restrictions imposed by any amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings of the contracts, agreements, instruments or obligations
referred to in clauses (1) through (13) above; provided that, as determined by the Issuer, such amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacements or refinancings (a) are not materially more restrictive
with respect to such encumbrances and restrictions than those prior to such amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings or (b) as determined by the Issuer, will not
materially adversely affect the Issuer’s ability to make principal or interest payments on the Notes; and
(15)
Transactions.
encumbrances or restrictions imposed on any member of the Match Group in connection with the Match
SECTION 4.12. Limitations on Designation of Unrestricted Subsidiaries .
At any time prior to a Suspension Event (or after the Reversion Date with respect thereto), the Issuer may designate any Subsidiary
(including any newly formed or newly acquired Subsidiary) of the Issuer as an “Unrestricted Subsidiary” under this Indenture (a “
Designation”) only if:
(1)
no Default shall have occurred and be continuing at the time of or after giving effect to such Designation;
and
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(2)
immediately after giving effect to such Designation, the Consolidated Leverage Test would be satisfied.
No Subsidiary shall be Designated as an “Unrestricted Subsidiary” unless such Subsidiary:
(1)
has no Indebtedness other than Non-Recourse Debt and other obligations arising by operation of law,
including joint and several liability for taxes, ERISA obligations and similar items, except, in each case, pursuant to
Investments which are made in accordance with Section 4.06;
(2)
is not party to any agreement, contract, arrangement or understanding with the Issuer or any Restricted
Subsidiary unless the terms of the agreement, contract, arrangement or understanding comply with Section 4.08; and
(3)
is a Person with respect to which neither the Issuer nor any Restricted Subsidiary has any direct or indirect
obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve the Person’s financial condition or to
cause the Person to achieve any specified levels of operating results, except, in each case, pursuant to Investments which are
made in accordance with Section 4.06.
The Issuer may redesignate an Unrestricted Subsidiary as a Restricted Subsidiary (a “ Redesignation”) only if:
(1)
Redesignation; and
no Default shall have occurred and be continuing at the time of and after giving effect to such
(2)
all Liens, Indebtedness and Investments of such Unrestricted Subsidiary outstanding immediately following
such Redesignation would, if incurred or made at such time, have been permitted to be incurred or made for all purposes of this
Indenture.
All Designations and Redesignations must be evidenced by an Officer’s Certificate certifying compliance with the foregoing
provisions delivered to the Trustee.
SECTION 4.13. Existence .
The Issuer shall do or cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and
the rights, licenses, permits, privileges and franchises material to the conduct of its business; provided that the foregoing shall not
prohibit any merger, consolidation, liquidation or dissolution permitted under Section 5.01, and the Issuer shall not be required to
preserve any such right, franchise, permit, license or legal existence if the Issuer shall determine in good faith the preservation thereof
is no longer desirable in the conduct of the business of the Issuer.
SECTION 4.14. Change of Control Offer .
If a Change of Control Triggering Event occurs with respect to the Notes, unless the Issuer has exercised its right to redeem the
Notes, the Issuer will be required to make an offer to repurchase
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all or, at the Holder’s option, any part (equal to $2,000 or any integral multiple of $1,000 in excess thereof) of each Holder’s Notes
pursuant to a Change of Control Offer.
In the Change of Control Offer, the Issuer will be required to offer payment in cash equal to 101% of the aggregate principal amount
of Notes to be purchased plus accrued and unpaid interest, if any, on the Notes repurchased, to, but not including, the date of purchase
(the “ Change of Control Payment ”). Within 30 days following any Change of Control Triggering Event with respect to the Notes,
unless the Issuer has exercised its right to redeem the Notes as described above, the Issuer shall mail, or deliver electronically if held
by DTC, a notice to Holders of Notes, with a copy to the Trustee for the Notes, describing the transaction or transactions that
constitute the Change of Control Triggering Event and offering to repurchase the Notes (a “ Change of Control Offer ”) on the date
specified in the notice, which date will be no earlier than 30 and no later than 60 days from the date such notice is sent (the “ Change
of Control Payment Date ”), pursuant to the procedures required by this Indenture and described in such notice.
On the Change of Control Payment Date, the Issuer will be required, to the extent lawful, to:
(1)
accept for payment all Notes or portions of Notes properly tendered pursuant to the Change of Control
Offer;
portions of Notes properly tendered; and
deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or
Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased.
deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officer’s
(2)
(3)
The Paying Agent will be required to promptly mail or transfer by wire, to each Holder who properly tendered Notes or portions
thereof, the purchase price for such Notes or portion thereof, and the Trustee shall be required to promptly authenticate and mail (or
cause to be transferred by book entry) to each such Holder a new Note equal in principal amount to any unpurchased portion of the
Notes surrendered, if any; provided that each new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in
excess thereof.
The Issuer will not be required to make a Change of Control Offer upon a Change of Control Triggering Event if a third party makes
such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Issuer and such
third party purchases all Notes or portions thereof properly tendered and not withdrawn under its offer. In the event that such third
party terminates or defaults its offer, the Issuer will be required to make a Change of Control Offer treating the date of such
termination or default as though it were the date of the Change of Control Triggering Event.
A Change of Control Offer may be made in advance of a Change of Control Triggering Event, and be conditional upon such Change
of Control Triggering Event, if a definitive agreement is in place in respect of the Change of Control at the time of making of the
Change of Control Offer.
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The Issuer shall comply with the requirements of applicable securities laws and regulations in connection with the purchase of Notes
pursuant to a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with the
provisions under this Section 4.14, the Issuer shall comply with the applicable securities laws and regulations.
SECTION 4.15. Suspension Event .
If on any date following the Issue Date (i) the Notes have an Investment Grade Rating from both Moody’s and Standard & Poor’s,
and the Issuer has delivered written notice of such Investment Grade Rating to the Trustee, and (ii) no Default has occurred and is
continuing under this Indenture (a “ Suspension Event ”), then, beginning on that day and continuing at all times thereafter except as
provided in the next succeeding paragraph, the provisions in the following sections shall no longer be applicable to the Notes
(collectively, the “ Suspended Covenants ”): Sections 4.05, 4.06, 4.07, 4.08, 4.10, 4.11 and clause (3) of Section 5.01.
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 ”) one or both of the Rating Agencies
withdraw their Investment Grade Rating or downgrade the rating assigned to the Notes below an Investment Grade Rating then the
Issuer and the Restricted Subsidiaries will thereafter again be subject to the Suspended Covenant under this Indenture with respect to
future events. The Issuer will give the Trustee prompt written notice of a Reversion Date. In the absence of such notice, the Trustee
shall be entitled to assume that no Suspension Event or Reversion Date has occurred.
The period of time between the Suspension Event and the Reversion Date is referred to in this description as the “ Suspension Period
.” Notwithstanding that the Suspended Covenants may be reinstated, no Default will occur or be deemed to have occurred solely as a
result of a failure to comply with the Suspended Covenants during the Suspension Period or the continued existence of circumstances
or obligations that occurred without complying with the Suspended Covenants during the Suspension Period.
On the Reversion Date, all Indebtedness incurred during the Suspension Period will be classified to have been incurred pursuant to
Section 4.05(a) or one of the clauses set forth in Section 4.05(b) (to the extent such Indebtedness would be permitted to be incurred
thereunder as of the Reversion Date and after giving effect to Indebtedness incurred prior to the Suspension Period and outstanding
on the Reversion Date). To the extent such Indebtedness would not be so permitted to be incurred pursuant to Section 4.05(a) or (b),
such Indebtedness will be deemed to have been outstanding on the Issue Date, so that it is classified as permitted under clause (3) of
Section 4.05(b). For purposes of Section 4.06, on the Reversion Date, all Restricted Payments made during the Suspension Period
shall be deemed to have been made under the first sentence of Section 4.06. For purposes of Section 4.11, on the Reversion Date, any
encumbrance or restriction on the ability of any Restricted Subsidiary described under clauses (a), (b) or (c) of the first paragraph
thereof created or otherwise caused or permitted to exist or become effective during the Suspension Period shall be deemed to have
been outstanding on the Issue Date, so that it is classified as permitted under clause (4) of such covenant. For purposes of Section
4.08, on the Reversion Date, any Affiliate Transaction entered into or permitted to exist during the
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Suspension Period shall be deemed to have been outstanding on the Issue Date, so that it is classified as permitted under clause (6) of
such covenant.
ARTICLE FIVE SUCCESSOR CORPORATION
SECTION 5.01. Limitations on Mergers, Consolidations, etc .
The Issuer will not, directly or indirectly, in a single transaction or a series of related transactions, (a) consolidate or merge with or
into another Person, or sell, lease, transfer, convey or otherwise dispose of all or substantially all of the assets of the Issuer or the
Issuer and the Restricted Subsidiaries (taken as a whole) or (b) adopt a Plan of Liquidation unless, in either case:
(1)
either:
(a)
the Issuer will be the surviving or continuing Person; or
(b)
the Person formed by or surviving such consolidation or merger or to which such sale, lease,
transfer, conveyance or other disposition shall be made (or, in the case of a Plan of Liquidation, any Person to which
assets are transferred) (collectively, the “ Successor”) is a corporation, limited liability company or limited partnership
organized and existing under the laws of any State of the United States of America or the District of Columbia, and the
Successor expressly assumes, by supplemental indenture in form and substance reasonably satisfactory to the Trustee,
all of the obligations of the Issuer under the Notes, this Indenture and, if applicable, the Registration Rights
Agreement;
(2)
immediately prior to and immediately after giving effect to such transaction and the assumption of the
obligations as set forth in clause (1)(b) above and the incurrence of any Indebtedness to be incurred in connection therewith,
and the use of any net proceeds therefrom on a pro forma basis, no Default shall have occurred and be continuing;
(3)
immediately after and giving effect to such transaction and the assumption of the obligations set forth in
clause (1)(b) above and the incurrence of any Indebtedness to be incurred in connection therewith, and the use of any net
proceeds therefrom on a pro forma basis, either (i) the Consolidated Leverage Test would be satisfied or (ii) the Successor
would have a Consolidated Leverage Ratio that is less than or equal to the Consolidated Leverage Ratio of the Issuer
immediately prior to the transaction;
(4)
each Guarantor, unless it is the other party to such transactions, in which case clause (1)(b) of the second
succeeding paragraph shall apply, shall have, by
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supplemental indenture, confirmed that its Note Guarantee shall apply to such Person’s obligations under this Indenture and
the Notes; and
(5)
the Issuer shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each
stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with this covenant and the
applicable provisions of this Indenture.
For purposes of this Section 5.01, any Indebtedness of the Successor which was not Indebtedness of the Issuer immediately prior to
the transaction shall be deemed to have been incurred in connection with such transaction.
Except as provided in Section 10.04, no Guarantor may consolidate with or merge with or into (whether or not such Guarantor is the
surviving Person) another Person, unless:
(1)
either:
(a)
such Guarantor shall be the surviving or continuing Person; or
(b)
the Person formed by or surviving any such consolidation or merger is another Guarantor or
assumes, by agreements in form and substance reasonably satisfactory to the Trustee, all of the obligations of such
Guarantor under the Note Guarantee of such Guarantor, this Indenture and, if applicable, the Registration Rights
Agreement;
(2)
immediately after giving effect to such transaction, no Default shall have occurred and be continuing; and
(3)
the Issuer shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each
stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with this covenant and the
applicable provisions of this Indenture.
For purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a single transaction or series of transactions) of
all or substantially all of the properties or assets of one or more Restricted Subsidiaries, the Equity Interests of which constitute all or
substantially all of the properties and assets of the Issuer, shall be deemed to be the transfer of all or substantially all of the properties
and assets of the Issuer.
Notwithstanding the foregoing, any Restricted Subsidiary may consolidate with, merge with or into or sell, convey, transfer, lease or
otherwise dispose of, in one transaction or a series of transactions, all or substantially all of its assets to the Issuer or another
Restricted Subsidiary; provided if such Restricted Subsidiary is a Guarantor, that the surviving entity remains or becomes a
Guarantor.
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SECTION 5.02. Successor Person Substituted .
Upon any consolidation or merger of the Issuer or a Guarantor or any sale, lease, transfer, conveyance or other disposition of all or
substantially all of the assets of the Issuer or any Guarantor in accordance with Section 5.01, in which the Issuer or such Guarantor is
not the continuing obligor under the Notes or its Note Guarantee the surviving entity formed by such consolidation or into which the
Issuer or such Guarantor is merged or the Person to which the conveyance, lease or transfer is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Issuer or such Guarantor, as the case may be, under this Indenture, the
Registration Rights Agreement, the Notes and the Note Guarantees, as applicable, with the same effect as if such surviving entity had
been named as the Issuer or such Guarantor herein and, except in the case of a lease, the Issuer or such Guarantor, as the case may be,
shall be released from the obligation to pay the principal of and interest on the Notes or in respect of its Note Guarantee, as the case
may be, and all of the Issuer’s or such Guarantor’s other obligations and covenants under the Notes, this Indenture and its Note
Guarantee, if applicable.
ARTICLE SIX DEFAULTS AND REMEDIES
SECTION 6.01. Events of Default .
Each of the following shall be an “ Event of Default ”:
(1)
(2)
(4)
(5)
continuance of any such failure for 30 days;
failure by the Issuer to pay interest on any of the Notes when it becomes due and payable and the
stated maturity, upon redemption, upon purchase, upon acceleration or otherwise;
failure by the Issuer to pay the principal on any of the Notes when it becomes due and payable, whether at
(3)
failure by the Issuer to comply (a) for 30 days after notice with
Section 5.01 or (b) for 45 days after notice in respect of its obligations to make a Change of Control Offer;
this failure for 60 days after notice;
failure by the Issuer to comply with any other agreement or covenant in this Indenture and continuance of
default under any mortgage, indenture or other instrument or agreement under which there may be issued or
by which there may be secured or evidenced Indebtedness of the Issuer or any Significant Subsidiary, whether such
Indebtedness now exists or is incurred after the Issue Date, which default:
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(a)
is caused by a failure to pay at final maturity principal on such Indebtedness within the applicable
express grace period and any extensions thereof, or
(b)
results in the acceleration of such Indebtedness prior to its express final maturity, and
in each case, the principal amount of such Indebtedness, together with any other Indebtedness with respect to which an event
described in clause (a) or (b) has occurred and is continuing, aggregates $75.0 million or more (and provided that, for
purposes of this clause (5) only, “Indebtedness” shall include any Hedging Obligations with the “principal amount” of any
Hedging Obligations at any time shall be the maximum aggregate amount (giving effect to any netting agreements) that the
Issuer or such Restricted Subsidiary would be required to pay if the agreement with respect to such Hedging Obligations
terminated at such time);
(6)
one or more judgments or orders that exceed $75.0 million in the aggregate (net of amounts covered by
insurance or bonded) for the payment of money have been entered by a court or courts of competent jurisdiction against the
Issuer or any Significant Subsidiary and such judgment or judgments have not been satisfied, stayed, annulled or rescinded
within 60 days of being entered;
(7)
the Issuer or any Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:
(a) commences a voluntary case,
(b) consents to the entry of an order for relief against it in an involuntary case,
(c) consents to the appointment of a Custodian of it or for all or substantially all of its assets, or
(d)
makes a general assignment for the benefit of its creditors;
(8)
a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(a) is for relief against the Issuer or any Significant Subsidiary as debtor in an involuntary case,
(b) appoints a Custodian of the Issuer or any Significant Subsidiary or a Custodian for all or substantially all
of the assets of the Issuer or any Significant Subsidiary, or
(c)
orders the liquidation of the Issuer or any Significant Subsidiary,
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and the order or decree remains unstayed and in effect for 60 days; or
(9)
any Note Guarantee of a Material Domestic Subsidiary ceases to be in full force and effect (other than in
accordance with the terms of such Note Guarantee and this Indenture) or is declared null and void and unenforceable or found
to be invalid or any Guarantor denies its liability in writing under its Note Guarantee (other than by reason of release of a
Guarantor from its Note Guarantee in accordance with the terms of this Indenture and the Note Guarantee).
However, a default under clauses (3) and (4) will not constitute an Event of Default until the Trustee or the holders of at least 25% in
principal amount of the outstanding notes notify the Issuer of the default and the Issuer does not cure such default within the
applicable time specified in clauses (3) and (4) after receipt of such notice.
SECTION 6.02. Acceleration .
If an Event of Default specified in clause (7) or (8) of Section 6.01 with respect to the Issuer or any Significant Subsidiary occurs, all
outstanding Notes shall become due and payable without any further action or notice. If any other Event of Default (other than an
Event of Default specified in clause (7) or (8) of Section 6.01 with respect to the Issuer or any Significant Subsidiary), shall have
occurred and be continuing hereunder, the Trustee, by written notice to the Issuer, or the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding by written notice to the Issuer and the Trustee, may declare all amounts owing under
the Notes to be due and payable. Upon such declaration of acceleration, the aggregate principal of and accrued and unpaid interest on
the outstanding Notes shall immediately become due and payable; provided , however , that after such acceleration, but before a
judgment or decree based on acceleration, the Holders of a majority in aggregate principal amount of such outstanding Notes may
rescind and annul such acceleration if all Events of Default, other than the nonpayment of accelerated principal and interest, have
been cured or waived as provided in this Indenture.
The Trustee shall, within ninety (90) days after the occurrence of any Default (which the Trustee is deemed to have knowledge of
pursuant to this Indenture) with respect to the Notes, give the Holders notice of all uncured Defaults thereunder known to it; provided
, however , that, except in the case of an Event of Default in payment with respect to the Notes or a Default in complying with Section
5.01, the Trustee shall be protected in withholding such notice if and so long as it in good faith determines that the withholding of
such notice is in the interest of the Holders.
SECTION 6.03. Other Remedies .
If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to
collect the payment of principal of, or premium, if any, and interest on the Notes or to enforce the performance of any provision of
the Notes and this Indenture and may take any necessary action requested of it as Trustee to settle, compromise, adjust or otherwise
conclude any proceedings to which it is a party.
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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 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. All available remedies are cumulative. Any costs associated with actions taken by the Trustee under this Section 6.03
shall be reimbursed to the Trustee by the Issuer.
SECTION 6.04. Waiver of Past Defaults and Events of Default .
Subject to Sections 6.02, 6.08 and 8.02, the Holders of a majority in aggregate principal amount of the Notes then outstanding have
the right to waive any existing Default or compliance with any provision of this Indenture or the Notes. 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 thereto.
SECTION 6.05. Control by Majority .
The Holders of a majority in aggregate principal amount of the then outstanding Notes may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee by this
Indenture. The Trustee, however, may refuse to follow any direction that conflicts with law or this Indenture or that the Trustee
determines may be unduly prejudicial to the rights of another Holder not taking part in such direction, and the Trustee shall have the
right to decline to follow any such direction if the Trustee, being advised by counsel, determines that the action so directed may not
lawfully be taken or if the Trustee in good faith shall, by a Responsible Officer, determine that the proceedings so directed may result
in costs and expenses of the Trustee for which it has no source of payment or recovery or involve it in personal liability; provided that
the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.
SECTION 6.06. Limitation on Suits .
No Holder shall have any right to institute any proceeding with respect to this Indenture or for any remedy thereunder, unless the
Trustee:
such Holder and a request to act by Holders of at least 25% in aggregate principal amount of Notes outstanding;
has failed to act for a period of 60 days after receiving written notice of a continuing Event of Default by
has been offered indemnity satisfactory to it in its reasonable judgment; and
has not received from the Holders of a majority in aggregate principal amount of the outstanding Notes a
direction inconsistent with such request.
(1)
(2)
(3)
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However, such limitations do not apply to a suit instituted by a Holder of any Note for enforcement of payment of the principal of or
interest on such Note on or after the due date therefor (after giving effect to the grace period specified in clause (1) of Section 6.01).
SECTION 6.07. No Personal Liability of Directors, Officers, Employees and Stockholders.
No director, officer, employee, incorporator or stockholder of the Issuer or any Guarantor shall have any liability for any obligations
of the Issuer under the Notes or this Indenture or of any Guarantor under its Note Guarantee or for any claim based on, in respect of,
or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver
and release are part of the consideration for issuance of the Notes and the Note Guarantees.
SECTION 6.08. Rights of Holders to Receive Payment .
Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of principal of, or premium, if any,
and interest of the Note on or after the respective due dates expressed in the Note, or to bring suit for the enforcement of any such
payment on or after such respective dates, is absolute and unconditional and shall not be impaired or affected without the consent of
the Holder.
SECTION 6.09. Collection Suit by Trustee .
If an Event of Default in payment of principal, premium or interest specified in clause (1) or (2) of Section 6.01 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 Guarantor
(or any other obligor on the Notes) for the whole amount of unpaid principal and accrued interest remaining unpaid, together with
interest on overdue principal and, to the extent that payment of such interest is lawful, interest on overdue installments of interest, in
each case at the rate set forth in the Notes.
SECTION 6.10. Trustee May File Proofs of Claim .
The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims
of the Trustee and the Holders allowed in any judicial proceedings relative to the Issuer or any Guarantor (or any other obligor upon
the Notes), its creditors or its property and shall be entitled and empowered to collect and receive any monies or other property
payable or deliverable on any such claims and to distribute the same after deduction of its charges and expenses to the extent that any
such charges and expenses are not paid out of the estate in any such proceedings and any custodian in any such judicial proceeding is
hereby authorized by each Holder to make such 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 to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.07.
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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 or reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof, or
to authorize the Trustee to vote in respect of the claim of any Holder in any such proceedings.
SECTION 6.11. Priorities .
If the Trustee collects any money pursuant to this Article Six, it shall pay out the money in the following order:
FIRST: to the Trustee for amounts due under Section 7.07;
SECOND: to Holders for amounts due and unpaid on the Notes for principal, premium, if any, and interest as to each,
ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes; and
THIRD: to the Issuer or, to the extent the Trustee collects any amount from any Guarantor, to such Guarantor.
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.11. 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 6.12. Undertaking for Costs .
In any suit for the enforcement of any right or remedy hereunder 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, 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 Section 6.12 does not
apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.08 or a suit by Holders of more than 10% in principal amount
of the Notes then outstanding.
SECTION 7.01. Duties of Trustee .
ARTICLE SEVEN TRUSTEE
(a)
If an Event of Default actually known to a Responsible Officer of the Trustee has occurred and is
continuing, the Trustee shall, in the exercise of its power, use the degree of care of a prudent person in similar circumstances in the
conduct of his own affairs.
(b)
Except during the continuance of an Event of Default:
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(1)
the Trustee need perform only those duties that are specifically set forth in this Indenture and no others; and
(2)
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 conforming to the
requirements of this Indenture but, in the case of any such certificates or opinions which by any provision hereof are required
to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether they conform on
their face to the requirements hereof (but need not confirm or investigate the accuracy of mathematical calculations or other
facts stated therein).
or its own willful misconduct, except that:
(c)
The Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act,
(1)
this clause (c) does not limit the effect of clause (b) of this Section 7.01;
(2)
(3)
(4)
Trustee was negligent in ascertaining the pertinent facts;
the Trustee shall not be liable for any error of judgment made in good faith, unless it is proved that the
with a direction received by it pursuant to the terms hereof; and
the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance
no provision hereof shall require the Trustee to expend or risk its own funds or otherwise incur any financial
liability in the performance of any of its rights, powers or duties if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity satisfactory to it against such risk or liability is not reasonably assured to it.
(d) Whether or not therein expressly so provided, paragraphs (a), (b), (c) and
(e)
of this Section 7.01 shall govern every provision of this Indenture that in any way relates to the Trustee.
The Trustee shall be under no obligation to exercise any of its rights or powers hereunder at the request of
any Holder of Notes unless such Holder of Notes shall have offered to the Trustee security and indemnity satisfactory to the Trustee.
(e)
(f)
The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in
writing with the Issuer or any Guarantor. Money held in trust by the Trustee need not be segregated from other funds except to the
extent required by the law.
(g)
Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection
to the Trustee shall be subject to the provisions of this Section
7.1 and to the provision of the TIA.
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SECTION 7.02. Rights of Trustee .
Subject to Section 7.01:
(1) The Trustee may rely on any document reasonably believed by it to be genuine and to have been signed or
presented by the proper person. The Trustee need not investigate any fact or matter stated in the document.
(2) Before the Trustee acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel,
or both, which shall conform to the provisions of Section 11.05. The Trustee shall be protected and shall not be liable for any
action it takes or omits to take in good faith in reliance on such certificate or opinion.
(3) The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or
negligence of any agent appointed by it with due care.
(4) The Trustee shall not be liable for any action it takes or omits to take in good faith which it reasonably believes to
be authorized or within its rights or powers; provided that the Trustee’s conduct does not constitute negligence or willful
misconduct.
(5) The Trustee may consult with counsel of its selection, and the advice or opinion of such counsel as to matters of
law 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.
(6) The Trustee shall not be deemed to have knowledge of any Default or Event of Default except (i) any Event of
Default occurring pursuant to clause (1) or (2) of Section 6.01 or (ii) any Event of Default of which the Trustee shall have
received written notification provided , the notice references this Indenture and the specific Event of Default. In the absence of
such notice, the Trustee may conclusively assume there is no Default except as aforesaid.
(7) The Trustee shall be under no obligation to exercise any of its rights or powers hereunder at the request of any
Holder of Notes unless such Holder of Notes shall have offered to the Trustee security and indemnity satisfactory to the
Trustee.
(8) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution,
certificate (including any Officer’s Certificate), statement, instrument, opinion (including any Opinion of Counsel), notice,
request, direction, consent, order, bond, debenture, note, other evidence of Indebtedness or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit and, if the
Trustee shall determine to make such further inquiry or investigation, it shall be entitled, upon reasonable notice to the Issuer,
to examine the books, records, and premises of the Issuer, personally or by agent or attorney at the sole cost of the
investigation.
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(9) The Trustee shall not be required to give any bond or surety in respect of the performance of its powers and
duties hereunder.
(10) The permissive rights of the Trustee to do things enumerated in this Indenture shall not be construed as duties
hereunder.
(11) The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its
right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and to
each agent, custodian and other Person employed to act hereunder.
(12) Delivery of reports, information and documents to the Trustee under Section 4.02 is for informational purposes
only and the Trustee’s receipt of the foregoing shall not constitute constructive notice of any information contained therein,
including the Issuer’s compliance with any of its covenants hereunder (as which the Trustee is entitled to rely exclusively on
the Officer’s Certificate).
(13) In no event shall the Trustee be responsible for special, indirect, punitive or consequential loss or damage of any
kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the
possibility of such loss or damage and regardless of the form of action.
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 make loans to, accept deposits
from, perform services for or otherwise deal with the either of the Issuer or any Guarantor, or any Affiliates thereof, with the same
rights it would have if it were not Trustee. Any Agent may do the same with like rights. The Trustee, however, shall be subject to
Sections 7.10 and 7.11.
SECTION 7.04. Trustee’s Disclaimer .
The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes or
any Note Guarantee, it shall not be accountable for the Issuer’s or any Guarantor’s use of the proceeds from the sale of Notes or any
money paid to the Issuer or any Guarantor pursuant to the terms of this Indenture and it shall not be responsible for the use or
application of money received by any Paying Agent other than the Trustee. The Trustee shall not be responsible for any statement in
the Notes, Note Guarantee, this Indenture or any other document in connection with the sale of the Notes other than its certificate of
authentication.
SECTION 7.05. Notice of Defau lts.
The Trustee shall, within 90 days after the occurrence of any Default with respect to the Notes (which the Trustee is aware of
pursuant to Section 7.02(6) hereof), give the Holders notice of all uncured Defaults thereunder known to it; provided , however , that,
except in the case of an Event of Default in payment with respect to the Notes or a Default in complying with Section 5.01, the
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Trustee shall be protected in withholding such notice if and so long as it in good faith determines that the withholding of such notice
is not opposed to the interest of the Holders.
SECTION 7.06. Reports by Trustee to Holders .
If required by TIA § 313(a), within 60 days after May 15th of any year, commencing May 15, 2016, the Trustee shall mail to each
Holder a brief report dated as of such reporting date that complies with TIA § 313(a). The Trustee also shall comply with TIA §
313(b)(2). The Trustee shall also transmit by mail all reports as required by TIA § 313(c) and TIA § 313(d).
Reports pursuant to this Section 7.06 shall be transmitted by mail:
(1)
to all Holders, as the names and addresses of such Holders appear on the Registrar’s books; and
(2)
to such Holders as have, within the two years preceding such transmission, filed their names and addresses
with the Trustee for that purpose.
A copy of each report at the time of its mailing to Holders shall be filed with the SEC and each stock exchange on which the Notes
are listed. The Issuer shall promptly notify the Trustee, and in any event within 10 Business Days, when the Notes are listed on any
stock exchange and of any delisting thereof.
SECTION 7.07. Compensation and Indemnity .
The Issuer and the Guarantors shall pay to the Trustee and Agents from time to time reasonable compensation for its services
hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express
trust) as agreed to from time to time by the Trustee and the Issuer. The Issuer and the Guarantors shall reimburse the Trustee and
Agents upon request for all reasonable out-of-pocket disbursements, expenses and advances incurred or made by it in connection with
its duties under this Indenture, including the reasonable compensation, disbursements and expenses of the Trustee’s agents and
counsel.
The Issuer and the Guarantors shall indemnify each of the Trustee and any predecessor Trustee for, and hold each of them harmless
against, any and all loss, damage, claim, liability or expense, including without limitation taxes (other than taxes based on the income
of the Trustee or such Agent) and reasonable attorneys’ fees and expenses incurred by each of them in connection with the acceptance
or performance of its duties, or otherwise arising, under this Indenture including the reasonable costs and expenses of defending itself
against any claim (whether brought by the Issuer, Guarantors, Holders or otherwise) or liability in connection with the exercise or
performance of any of its powers or duties hereunder (including, without limitation, settlement costs). The Trustee or Agent shall
notify the Issuer and the Guarantors in writing promptly of any claim asserted against the Trustee or Agent for which it may seek
indemnity. However, the failure by the Trustee or Agent to so notify the Issuer and the Guarantors shall not relieve the Issuer and
Guarantors of their obligations hereunder except to the extent the Issuer and the Guarantors are prejudiced thereby.
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Notwithstanding the foregoing, the Issuer and the Guarantors need not reimburse the Trustee for any expense or indemnify it against
any loss or liability incurred by the Trustee through its negligence, bad faith or willful misconduct. To secure the payment obligations
of the Issuer and the Guarantors in this Section 7.07, the Trustee shall have a lien prior to the Notes on all money or property held or
collected by the Trustee except such money or property held in trust to pay principal of and interest on particular Notes. The
obligations of the Issuer and the Guarantors under this Section 7.07 to compensate and indemnify the Trustee, Agents and each
predecessor Trustee and to pay or reimburse the Trustee, Agents and each predecessor Trustee for expenses, disbursements and
advances shall survive the resignation or removal of the Trustee and the satisfaction, discharge or other termination of this Indenture,
including any termination or rejection hereof under any Bankruptcy Law.
When the Trustee incurs expenses or renders services after an Event of Default specified in clause (7) or (8) of Section 6.01 occurs,
the expenses and the compensation for the services are intended to constitute expenses of administration under any Bankruptcy Law.
For purposes of this Section 7.07, the term “Trustee” shall include any trustee appointed pursuant to this Article Seven.
SECTION 7.08. Replacement of Trustee .
The Trustee may resign by so notifying the Issuer and the Guarantors in writing. The Holders of a majority in principal amount of the
outstanding Notes may remove the Trustee by notifying the Issuer and the removed Trustee in writing and may appoint a successor
Trustee with the Issuer’s written consent, which consent shall not be unreasonably withheld. The Issuer may remove the Trustee at its
election if:
(1)
(2)
(3)
or
the Trustee fails to comply with Section 7.10;
the Trustee is adjudged a bankrupt or an insolvent;
a receiver or other public officer takes charge of the Trustee or its property;
(4)
the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Issuer shall promptly appoint a
successor Trustee. If a Trustee is removed with or without cause, all fees and expenses (including the reasonable fees and expenses of
counsel) of the Trustee incurred in the administration of the trust or in performing the duties hereunder shall be paid to the Trustee.
If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the
Issuer or the Holders of at least 10% in principal amount of the outstanding Notes may petition any court of competent jurisdiction, at
the expense of the Issuer, for the appointment of a successor Trustee.
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If the Trustee fails to comply with Section 7.10, any Holder may petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Issuer. Immediately
following such delivery, the retiring Trustee shall, subject to its rights under Section 7.07, transfer all property held by it as Trustee to
the successor Trustee, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture. A successor Trustee shall mail notice of its succession to each
Holder. Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Issuer obligations under Section 7.07 shall
continue for the benefit of the retiring Trustee.
SECTION 7.09. Successor Trustee by Consolidation, Merger, etc .
If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust assets to, another
entity, subject to Section 7.10, the successor entity without any further act shall be the successor Trustee; provided such entity shall
be otherwise qualified and eligible under this Article Seven.
SECTION 7.10. Eligibility; Disqualification .
This Indenture shall always have a Trustee who satisfies the requirements of TIA § 310(a)(1) and
(2)
in every respect. The Trustee (together with its corporate parent) shall have a combined capital and surplus of at least
$50,000,000 as set forth in the most recent applicable published annual report of condition. The Trustee shall comply with TIA §
310(b), including the provision in § 310(b)(1).
SECTION 7.11. Preferential Collection of Claims Against Issuer .
The Trustee shall comply with TIA § 311(a), excluding any creditor relationship listed in TIA
§ 311 (b). A Trustee who has resigned or been removed shall be subject to TIA § 311(a) to the extent indicated therein.
SECTION 7.12. Paying Agents .
The Issuer shall cause each Paying Agent other than the Trustee to execute and deliver to it and the Trustee an instrument in which
such agent shall agree with the Trustee, subject to the provisions of this Section 7.12:
(A)
that it shall hold all sums held by it as agent for the payment of principal of, or premium, if any, or interest
on, the Notes (whether such sums have been paid to it by the Issuer or by any obligor on the Notes) in trust for the benefit of
Holders or the Trustee;
(B)
that it shall at any time during the continuance of any Event of Default, upon written request from the
Trustee, deliver to the Trustee all sums so held in trust by it together with a full accounting thereof; and
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(C)
that it shall give the Trustee written notice within three (3) Business Days of any failure of the Issuer (or by
any obligor on the Notes) in the payment of any installment of the principal of, premium, if any, or interest on, the Notes
when the same shall be due and payable.
ARTICLE EIGHT AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 8.01. Without Consent of H olders.
The Issuer and the Trustee may amend, waive or supplement this Indenture, the Note Guarantees or the Notes without prior notice to
or consent of any Holder:
(1)
Section 5.01;
(2)
(3)
(4)
to provide for the assumption of the Issuer’s or a Guarantor’s obligations to the Holders in accordance with
to provide for uncertificated Notes in addition to or in place of certificated Notes;
to cure any ambiguity, defect or inconsistency;
to add any guarantees with respect to the Notes, including the Note Guarantees;
(5)
to release any Guarantor from any of its obligations under its Note Guarantee or this Indenture (to the extent
permitted by this Indenture);
(6)
(7)
(8)
to maintain the qualification of this Indenture under the TIA;
to secure the Notes;
to provide for the issuance of Additional Notes in accordance with the provisions set forth in this Indenture;
(9)
to add to the covenants of the Issuer or a Restricted Subsidiary for the benefit of the Holders of the Notes or
to surrender any right or power conferred upon the Issuer or a Restricted Subsidiary;
(10)
to evidence and provide for the acceptance of appointment by a successor trustee with respect to the Notes
and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the
administration of the trusts thereunder by more than one trustee;
(11)
to conform the text of this Indenture, the Notes or the Note Guarantees to any provision of the “Description
of the New Match Notes” in the Offering Memorandum
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to the extent that such provision in the “Description of the New Match Notes” was intended to be a verbatim recitation of a
provision of this Indenture, the Notes or the Note Guarantees; or
(12)
to make any change that does not materially adversely affect the rights of any Holder hereunder.
The Trustee is hereby authorized to join with the Issuer and the Guarantors in the execution of any supplemental indenture authorized
or permitted by the terms of this Indenture and to make any further appropriate agreements and stipulations which may be therein
contained, but the Trustee shall not be obligated to enter into any such supplemental indenture which adversely affects its own rights,
duties or immunities under this Indenture.
SECTION 8.02. With Consent of Holders .
This Indenture or the Notes may be amended with the consent (which may include consents obtained in connection
with a tender offer or exchange offer for Notes) of the Holders of at least a majority in principal amount of the Notes then
outstanding, and any existing Default under, or compliance with any provision of, this Indenture may be waived (other than any
continuing Default in the payment of the principal or interest on the Notes, except a rescission of acceleration of the Notes by the
Holders thereof as provided in this Indenture and a waiver of the payment default that resulted from such acceleration) with the
consent (which may include consents obtained in connection with a tender offer or exchange offer for Notes) of the Holders of a
majority in aggregate principal amount of the Notes then outstanding; provided that, without the consent of each Holder affected, no
amendment or waiver may:
(1)
(2)
reduce, or change the maturity of, the principal of any Note;
reduce the rate of or extend the time for payment of interest on any Note;
(3)
reduce any premium payable upon redemption of the Notes or change the date on, or the circumstances
under, which any Notes are subject to redemption (other than provisions relating to the purchase of Notes described in Section
4.14, except that if a Change of Control Triggering Event has occurred, no amendment or other modification of the obligation
of the Issuer to make a Change of Control Offer relating to such Change of Control Triggering Event shall be made without the
consent of each Holder of the Notes affected);
(4)
(5)
make any Note payable in money or currency other than that stated in the Notes;
modify or change any provision of this Indenture or the related definitions to affect the ranking of the Notes
or any Note Guarantee in a manner that adversely affects the Holders;
(6)
reduce the percentage of Holders necessary to consent to an amendment or waiver to this Indenture or the
Notes;
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(7)
waive a default in the payment of principal of or premium or interest on any Notes (except a rescission of
acceleration of the Notes by the Holders thereof as provided in this Indenture and a waiver of the payment default that resulted
from such acceleration);
(8)
(9)
date therefor or to institute suit for the enforcement of any payment on the Notes; or
impair the rights of Holders to receive payments of principal of or interest on the Notes on or after the due
release any Guarantor that is a Material Domestic Subsidiary from any of its obligations under its Note
Guarantee or this Indenture, except as permitted by this Indenture, or amend the definition of Material Domestic Subsidiary in
a manner adverse to Holders.
After an amendment, supplement or waiver under this Section 8.02 becomes effective, the Issuer shall mail to the Holders a notice
briefly describing the amendment, supplement or waiver. Any failure of the Issuer to mail such notice, or any defect therein, shall not
in any way impair or affect the validity of the amendment, supplement or waiver.
Upon the written request of the Issuer, accompanied by a Board Resolution authorizing the execution of any such supplemental
indenture, and upon the receipt by the Trustee of evidence reasonably satisfactory to the Trustee of the consent of the Holders as
aforesaid and upon receipt by the Trustee of the documents described in Section 8.06, the Trustee shall join with the Issuer and the
Guarantors in the execution of such supplemental indenture unless such supplemental indenture affects the Trustee’s own rights,
duties or immunities under this Indenture, in which case the Trustee may, but shall not be obligated to, enter into such supplemental
indenture.
It shall not be necessary for the consent of the Holders under this Section 8.02 to approve the particular form of any proposed
amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof.
SECTION 8.03. Compliance with Trust Indenture Act .
Every amendment or supplement to this Indenture or the Notes shall comply with the TIA as then in effect.
SECTION 8.04. Revocation and Effect of Consents .
Until an amendment, supplement, waiver or other action becomes effective, a consent to it by a Holder is a continuing consent
conclusive and binding upon such Holder and every subsequent Holder of the same Note or portion thereof, and of any Note issued
upon the transfer thereof or in exchange therefor or in place thereof, even if notation of the consent is not made on any such Note.
Any such Holder or subsequent Holder, however, may revoke the consent as to his Note
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or portion of a Note, if the Trustee receives the written notice of revocation before the date the amendment, supplement, waiver or
other action becomes effective.
The Issuer may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any
amendment, supplement, or waiver. If a record date is fixed, then, notwithstanding the preceding paragraph, those Persons who were
Holders at such record date (or their duly designated proxies), and only such Persons, shall be entitled to consent to such amendment,
supplement, or waiver or to revoke any consent previously given, 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 unless the consent of the
requisite number of Holders has been obtained.
After an amendment, supplement, waiver or other action becomes effective, it shall bind every Holder, unless it makes a change
described in any of clauses (1) through (9) of Section 8.02. In that case the amendment, supplement, waiver or other action shall bind
each Holder who has consented to it and every subsequent Holder or portion of a Note that evidences the same debt as the consenting
Holder’s Note.
SECTION 8.05. Notation on or Exchange of Notes .
If an amendment, supplement, or waiver changes the terms of a Note, the Trustee (in accordance with the specific written direction of
the Issuer) shall request the Holder (in accordance with the specific written direction of the Issuer) to deliver it to the Trustee. In such
case, the Trustee shall place an appropriate notation on the Note about the changed terms and return it to the Holder.
Alternatively, if the Issuer or the Trustee so determines, the Issuer in exchange for the Note shall issue, the Guarantors shall endorse,
and the Trustee shall authenticate a new Note that reflects the changed terms. Failure to make the appropriate notation or issue a new
Note shall not affect the validity and effect of such amendment, supplement or waiver.
SECTION 8.06. Trustee to Sign Amendments, etc .
The Trustee shall sign any amendment, supplement or waiver authorized pursuant to this
Article Eight if the amendment, supplement or waiver does not adversely affect the rights, duties, liabilities or immunities of the
Trustee. If it does, the Trustee may, but need not, sign it. In signing or refusing to sign such amendment, supplement or waiver the
Trustee shall be entitled to receive and, subject to Section 7.01, shall be fully protected in relying conclusively upon an Officer’s
Certificate and an Opinion of Counsel stating, in addition to the matters required by Section 11.04, that such amendment, supplement
or waiver is authorized or permitted by this Indenture and all conditions precedent required hereunder to such amendment,
supplement or waiver have been complied with.
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ARTICLE NINE
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 9.01. Discharge of Indenture .
This Indenture will be discharged and will cease to be of further effect as to all outstanding Notes, except the obligations referred to
in the last paragraph of this Section 9.01, if
(1)
all the Notes that have been authenticated and delivered (except lost, stolen or destroyed Notes which have
been replaced or paid and Notes for whose payment money has been deposited in trust or segregated and held in trust by the
Issuer and thereafter repaid to the Issuer or discharged from this trust) have been delivered to the Trustee for cancellation, or
(2)
(a) all Notes not delivered to the Trustee for cancellation otherwise (i) have become due and payable, (ii)
shall become due and payable, or may be called for redemption, within one year or (iii) have been called for redemption
pursuant to paragraph 6 of the Notes, and, in any case, the Issuer has irrevocably deposited or caused to be deposited with the
Trustee as trust funds, in trust solely for the benefit of the Holders, U.S. legal tender, U.S. Government Obligations or a
combination thereof, in such amounts as shall be sufficient (without consideration of any reinvestment of interest), as
evidenced by an Officer’s Certificate of the Issuer, to pay and discharge the entire Indebtedness (including all principal and
accrued interest) on the Notes not theretofore delivered to the Trustee for cancellation,
(b)
the Issuer has paid all other sums payable by it under this Indenture, and
(c)
the Issuer has delivered irrevocable instructions to the Trustee to apply the deposited money toward the
payment of the Notes at maturity or on the date of redemption, as the case may be.
In addition, the Issuer must deliver an Officer’s Certificate and an Opinion of Counsel stating that all conditions precedent to
satisfaction and discharge have been complied with.
After such delivery, the Trustee shall acknowledge in writing the discharge of the Issuer’s obligations terminated pursuant to this
Section 9.01.
Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Issuer in Section 2.07 shall survive until all
Notes have been cancelled and the obligations of the Issuer in Sections 7.07, 9.05 and 9.06 shall survive.
SECTION 9.02. Legal D efeasance.
The Issuer may at its option, by Board Resolution, be discharged from its obligations with respect to the Notes and the Guarantors
discharged from their obligations under the Note
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Guarantees on the date the conditions set forth in Section 9.04 are satisfied (hereinafter, “ Legal Defeasance ”). For this purpose, such
Legal Defeasance means that the Issuer and the Guarantors shall be deemed to have paid and discharged the entire indebtedness
represented by the Notes and the Note Guarantees with respect thereto and to have satisfied all its other obligations under such Notes,
such Note Guarantees and this Indenture insofar as the Notes are concerned (and the Trustee, at the expense of the Issuer, shall,
subject to Section 9.06, execute instruments in form and substance reasonably satisfactory to the Trustee and Issuer acknowledging
the same), except for the following which shall survive until otherwise terminated or discharged hereunder:
the rights of Holders of outstanding Notes to receive payments in respect of the principal of, premium, if any, and interest on
(a)
the Notes when such payments are due solely from the trust funds described in Section 9.04 and as more fully set forth in such
Section, (b) the Issuer’s obligations with respect to the Notes under Sections 2.04, 2.05, 2.06, 2.07, 2.08 and 2.11, (c) the rights,
powers, trusts, duties, and immunities of the Trustee hereunder (including claims of, or payments to, the Trustee under or pursuant to
Section 7.07) and the Issuer’s obligation in connection therewith, and (d) this Article Nine. Subject to compliance with this Article
Nine, the Issuer may exercise its option under this Section 9.02 with respect to Notes notwithstanding the prior exercise of its option
under Section 9.03 with respect to such Notes.
SECTION 9.03. Covenant Defeasance .
At the option of the Issuer, pursuant to a Board Resolution (x) the Issuer and the Guarantors shall be released from their respective
obligations under Sections 4.02 (except for obligations mandated by the TIA), 4.05 through 4.12, inclusive, 4.14 and clause (3) of the
first paragraph of Section 5.01 and (y) clauses (4), (5), (6) and (9) of Section 6.01 shall no longer apply with respect to the Notes on
and after the date the conditions set forth in Section 9.04 are satisfied (hereinafter, “ Covenant Defeasance ”). For this purpose, such
Covenant Defeasance means that the Issuer and the Guarantors may omit to comply with and shall have no liability in respect of any
term, condition or limitation set forth in any such specified Section or portion thereof, whether directly or indirectly by reason of any
reference elsewhere herein to any such specified Section or portion thereof or by reason of any reference in any such specified
Section or portion thereof to any other provision herein or in any other document, and thereafter any omission to comply with such
obligations shall not constitute a Default, but the remainder of this Indenture and the Notes shall be unaffected thereby.
SECTION 9.04. Conditions to Legal Defeasance or Covenant Defeasance .
The following shall be the conditions to application of Section 9.02 or Section 9.03 to the outstanding Notes:
(1)
the Issuer must irrevocably deposit with the Trustee, as trust funds, in trust solely for the benefit of the
Holders of the Notes, U.S. legal tender, U.S. Government Obligations or a combination thereof, in such amounts as shall be
sufficient (without consideration of any reinvestment of interest), as evidenced by an Officer’s Certificate of the Issuer, to pay
the principal of and interest on the Notes on the stated date for payment
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or on the Redemption Date of the principal or installment of principal of or interest on the Notes,
(2)
in the case of Legal Defeasance, the Issuer shall have delivered to the Trustee an Opinion of Counsel in the
United States confirming that:
(a)
the Issuer has received from, or there has been published by the Internal Revenue Service, a ruling,
or
(b)
since the date hereof, 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 Holders of such outstanding
Notes will not recognize income, gain or loss for
U.S. federal income tax purposes as a result of the Legal 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 Legal Defeasance had not
occurred,
(3)
in the case of Covenant Defeasance, the Issuer shall have delivered to the Trustee an Opinion of Counsel in
the United States reasonably acceptable to the Trustee confirming that the Holders of such outstanding Notes will not
recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant 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 the Covenant Defeasance had not occurred,
(4)
(5)
from the borrowing of funds to be applied to such deposit),
no Default shall have occurred and be continuing on the date of such deposit (other than a Default resulting
the Issuer shall have delivered to the Trustee an Officer’s Certificate stating that the deposit was not made
by it with the intent of preferring the Holders of such Notes over any other of its creditors or with the intent of defeating,
hindering, delaying or defrauding any other of its creditors or others, and
(6)
the Issuer shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each
stating that the conditions provided for in, in the case of the Officer’s Certificate, clauses (1) through (4) and, in the case of the
Opinion of Counsel, clauses (2) and/or (3) of this paragraph have been complied with.
If the funds deposited with the Trustee to effect Covenant Defeasance are insufficient to pay the principal of and interest on the Notes
when due, then the obligations of the Issuer and the obligations of Guarantors under this Indenture shall be revived and no such
defeasance shall be deemed to have occurred.
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SECTION 9.05. Deposited Money and U.S. Government Obligations to Be Held in Trust; Other Miscellaneous Provisions.
All money and U.S. Government Obligations (including the proceeds thereof) deposited with the Trustee pursuant to Section 9.04 in
respect of the outstanding Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and
this Indenture, to the payment, either directly or through any Paying Agent, to the Holders of such Notes, of all sums due and to
become due thereon in respect of principal, premium, if any, and accrued interest, but such money need not be segregated from other
funds except to the extent required by law.
The Issuer and the Guarantors shall (on a joint and several basis) pay and indemnify the Trustee against any tax, fee or other charge
imposed on or assessed against the U.S. Government Obligations deposited pursuant to Section 9.04 or the principal, premium, if any,
and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of
the outstanding Notes.
Anything in this Article Nine to the contrary notwithstanding, the Trustee shall deliver or pay to the Issuer from time to time any
money or U.S. Government Obligations held by it as provided in Section 9.04 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof delivered to the Trustee, are in excess of the amount
thereof which would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
SECTION 9.06. Reinstatement .
If the Trustee or Paying Agent is unable to apply any money or U.S. Government Obligations in accordance with Section 9.01, 9.02
or 9.03 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 and each Guarantor’s obligations terminated pursuant to Section
9.01, 9.02 or 9.03, as applicable, shall be revived and reinstated as though no deposit had occurred pursuant to this Article Nine until
such time as the Trustee or Paying Agent is permitted to apply all such money or U.S. Government Obligations in accordance with
Section 9.01; provided that if the Issuer or the Guarantors have made any payment of principal of, premium, if any, or accrued
interest on any Notes because of the reinstatement of their obligations, the Issuer or the Guarantors, as the case may be, 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 Paying Agent.
SECTION 9.07. Moneys Held by Paying Agent .
In connection with the satisfaction and discharge of this Indenture, all moneys then held by any Paying Agent under the provisions of
this Indenture shall, upon written demand of the Issuer, be paid to the Trustee, or if sufficient moneys have been deposited pursuant to
Section 9.04, to the Issuer (or, if such moneys had been deposited by the Guarantors, to such Guarantors), and thereupon such Paying
Agent shall be released from all further liability with respect to such moneys.
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SECTION 9.08. Moneys Held by Trustee .
Subject to applicable law, any moneys deposited with the Trustee or any Paying Agent or then held by the Issuer or the Guarantors in
trust for the payment of the principal of, or premium, if any, or interest on any Note that are not applied but remain unclaimed by the
Holder of such Note for two years after the date upon which the principal of, or premium, if any, or interest on such Note shall have
respectively become due and payable shall be repaid to the Issuer (or, if appropriate, the Guarantors), or if such moneys are then held
by the Issuer or the Guarantors in trust, such moneys shall be released from such trust; and the Holder of such Note entitled to receive
such payment shall thereafter, as an unsecured general creditor, look only to the Issuer and the Guarantors for the payment thereof,
and all liability of the Trustee or such Paying Agent with respect to such trust money shall thereupon cease; provided that the Trustee
or any such Paying Agent, before being required to make any such repayment, may, at the expense of the Issuer and the Guarantors,
either mail to each Holder affected, at the address shown in the register of the Notes maintained by the Registrar pursuant to Section
2.04, or cause to be published once a week for two successive weeks, in a newspaper published in the English language, customarily
published each Business Day and of general circulation in the City of New York, New York, a notice that such money remains
unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such mailing or publication,
any unclaimed balance of such moneys then remaining shall be repaid to the Issuer. After payment to the Issuer or the Guarantors or
the release of any money held in trust by the Issuer or any Guarantors, as the case may be, Holders entitled to the money must look
only to the Issuer and the Guarantors for payment as general creditors unless applicable abandoned property law designates another
Person.
ARTICLE TEN GUARANTEE OF NOTES
SECTION 10.01. Guarantee .
Subject to the provisions of this Article Ten, each Person that becomes a Guarantor in accordance with Section 4.10, by execution of
a supplemental indenture to this Indenture in form and substance reasonably satisfactory to the Trustee, jointly and severally,
unconditionally guarantees (each, a “ Note Guarantee ” and collectively, the “ Note Guarantees ”) to each Holder and the Trustee (i)
the due and punctual payment of the principal of and interest on each Note, when and as the same shall become due and payable,
whether at maturity, by acceleration or otherwise, the due and punctual payment of interest on the overdue principal of and interest on
the Notes, to the extent lawful, and the due and punctual payment of all obligations of the Issuer to the Holders or the Trustee all in
accordance with the terms of such Note, this Indenture and the Registration Rights Agreement, and (ii) in the case of any extension of
time of payment or renewal of any Notes or any of such other Obligations, that the same shall be promptly paid in full when due or
performed in accordance with the terms of the extension or renewal, at stated maturity, by acceleration or otherwise. Each Guarantor,
by execution of a supplemental
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indenture to this Indenture, agrees that its obligations hereunder shall be absolute and unconditional, irrespective of, and shall be
unaffected by, any invalidity, irregularity or unenforceability of any such Note, this Indenture or the Registration Rights Agreement,
any failure to enforce the provisions of any such Note, this Indenture or the Registration Rights Agreement, any waiver, modification
or indulgence granted to the Issuer with respect thereto by the Holder of such Note, or any other circumstances which may otherwise
constitute a legal or equitable discharge of a surety or such Guarantor.
Each Guarantor, by execution of a supplemental indenture to this Indenture, waives diligence, presentment, demand for payment,
filing of claims with a court in the event of merger or bankruptcy of the Issuer, any right to require a proceeding first against the
Issuer, protest or notice with respect to any such Note or the Indebtedness evidenced thereby (except as expressly required hereunder,
including pursuant to Article Six hereof) and all demands whatsoever, and covenants that this Note Guarantee shall not be discharged
as to any such Note except by payment in full of the principal thereof and interest thereon. Each Guarantor, by execution of a
supplemental indenture to this Indenture, agrees that, as between such Guarantor, on the one hand, and the Holders and the Trustee,
on the other hand, (i) the maturity of the Obligations guaranteed pursuant to such supplemental indenture may be accelerated as
provided in
Article Six for the purposes of this Note Guarantee, notwithstanding any stay, injunction or other prohibition preventing such
acceleration in respect of the Obligations guaranteed by execution of such supplemental indenture, and (ii) in the event of any
declaration of acceleration of such Obligations as provided in Article Six, such Obligations (whether or not due and payable) shall
forthwith become due and payable by each Guarantor for the purpose of the Note Guarantee.
SECTION 10.02. Execution and Delivery of Guarantee .
If an officer of a Guarantor whose signature is on a supplemental indenture to this Indenture no longer holds that office at the time the
Trustee authenticates the Note or at any time thereafter, such Guarantor’s Note Guarantee of such Note shall be valid nevertheless.
The delivery of any Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of any Note
Guarantee on behalf of the Guarantor.
SECTION 10.03. Limitation of Guarantee .
The obligations of each Guarantor under its Note Guarantee are limited to the maximum amount as shall, after giving effect to all
other contingent and fixed liabilities of such Guarantor (including, without limitation, any guarantees under the Credit Agreement)
and after giving effect to any collections from or payments made by or on behalf of any other Guarantor in respect of the obligations
of such other Guarantor under its Note Guarantee or pursuant to its contribution obligations under this Indenture, result in the
obligations of such Guarantor under its Note Guarantee not constituting a fraudulent conveyance or fraudulent transfer under federal
or state law. Each Guarantor that makes a payment or distribution under its Note Guarantee shall be entitled to a contribution from
each other Guarantor in a pro rata amount based on the adjusted net assets of each Guarantor.
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SECTION 10.04. Release of Guarantor .
A Guarantor shall be released from its obligations under its Note Guarantee and its obligations under this Indenture:
(1)
in the event of dissolution of such Guarantor;
(2)
if such Guarantor is designated as an Unrestricted Subsidiary or otherwise ceases to be a Restricted
Subsidiary, in each case in accordance with the provisions of this Indenture, upon effectiveness of such designation or when it
first ceases to be a Restricted Subsidiary, respectively;
(3)
upon the release, discharge or reclassification of any Indebtedness or any other guarantee by such Guarantor
incurred in reliance on the Leverage Ratio Exception except, with respect to a guarantee, a discharge or release by or as a result
of payment under such other guarantee; or
(4)
upon the exercise of the legal defeasance option or covenant defeasance option pursuant to Sections 9.02 or
9.03 hereof, as applicable, or if the obligations under this Indenture are discharged in accordance with the terms hereof,
and in each such case, the Issuer has delivered to the Trustee an Officer’s Certificate or an Opinion of Counsel, each stating that all
conditions precedent herein provided for relating to such transactions have been complied with and that such release is authorized and
permitted hereunder.
The Trustee shall execute any documents reasonably requested by the Issuer or a Guarantor in order to evidence the release of such
Guarantor from its obligations under its Note Guarantee endorsed on the Notes and under this Article Ten.
SECTION 10.05. Waiver of Subrogation .
Until the Notes have been paid in full, each Guarantor hereby irrevocably waives any claim or other rights which it may now or
hereafter acquire against the Issuer that arise from the existence, payment, performance or enforcement of such Guarantor’s
obligations under its Note Guarantee and this Indenture, including, without limitation, any right of subrogation, reimbursement,
exoneration, indemnification, and any right to participate in any claim or remedy of any Holder of Notes against the Issuer, whether
or not such claim, remedy or right arises in equity, or under contract, statute or common law, including, without limitation, the right
to take or receive from the Issuer, directly or indirectly, in cash or other property or by set-off or in any other manner, payment or
Note on account of such claim or other rights. If any amount shall be paid to any Guarantor in violation of the preceding sentence and
the Notes shall not have been paid in full, such amount shall have been deemed to have been paid to such Guarantor for the benefit of,
and held in trust for the benefit of, the Holders, and shall forthwith be paid to the Trustee for the benefit of such Holders to be
credited and applied upon the Notes, whether matured or unmatured, in accordance with the terms of this Indenture. Each Guarantor
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acknowledges that it shall receive direct and indirect benefits from the financing arrangements contemplated by this Indenture and
that the waiver set forth in this Section 10.05 is knowingly made in contemplation of such benefits.
ARTICLE ELEVEN MISCELLANEOUS
SECTION 11.01. Trust Indenture Act Controls .
If any provision of this Indenture limits, qualifies or conflicts with another provision which is required to be included in this
Indenture by the TIA, the required provision shall control. If any provision of this Indenture modifies any TIA provision that may be
so modified, such TIA provision shall be deemed to apply to this Indenture as so modified. If any provision of this Indenture excludes
any TIA provision that may be so excluded, such TIA provision shall be excluded from this Indenture.
The provisions of TIA §§ 310 through 317 that impose duties on any Person (including the provisions automatically deemed included
unless expressly excluded by this Indenture) are a part of and govern this Indenture, whether or not physically contained herein.
SECTION 11.02. Notices .
Except for notice or communications to Holders, any notice or communication shall be given in writing and delivered in person, sent
by facsimile, delivered by commercial courier service or mailed by first-class mail, postage prepaid, addressed as follows:
If to the Issuer or any Guarantor: MATCH GROUP, INC.
555 West 18th Street
New York, New York 10011 Attention: Chief Financial Officer Fax Number: (212) 632-9529
with copies to:
MATCH GROUP, INC.
555 West 18th Street
New York, New York 10011 Attention: General Counsel Fax Number: (212) 632-9551
If to the Trustee:
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COMPUTERSHARE TRUST COMPANY, N.A.
8742 Lucent Boulevard, Suite 225 Highlands Ranch, Colorado 80129 Attention: Corporate Trust
Fax Number: (303) 262-0608
with a copy to:
Perkins Coie, LLP 30 Rockefeller Plaza 22 nd Floor
New York, New York 10112 Attention: Sean Connery
Fax Number: (212) 977-1649
and to:
COMPUTERSHARE TRUST COMPANY, N.A.
480 Washington Blvd.
Jersey City, New Jersey 07310 Attention: Legal Department Fax Number: (201) 680-4610
Such notices or communications shall be effective when received and shall be sufficiently given if so given within the time prescribed
in this Indenture.
The Issuer, the Guarantors or the Trustee by written notice to the others may designate additional or different addresses for
subsequent notices or communications.
Any notice or communication mailed to a Holder shall be mailed to him by first-class mail, postage prepaid, at his address shown on
the register kept by the Registrar.
Failure to mail 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 to a Holder is mailed in the manner provided above, it shall be deemed duly given, whether or not the
addressee receives it.
In case by reason of the suspension of regular mail service, or by reason of any other cause, it shall be impossible to mail any notice
as required by this Indenture, then such method of notification as shall be made with the approval of the Trustee shall constitute a
sufficient mailing of such notice.
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SECTION 11.03. Communications by Holders with Other Holders .
Holders may communicate pursuant to TIA § 312(b) with other Holders with respect to their rights under this Indenture or the Notes.
The Issuer, the Guarantors, the Trustee, the Registrar and anyone else shall have the protection of TIA § 312(c).
SECTION 11.04. Certificate and Opinion as to Conditions Precedent .
Upon any request or application by the Issuer or any Guarantor to the Trustee to take any action or refrain from taking any action
under this Indenture, the Issuer or such Guarantor shall furnish to the Trustee:
(1)
an Officer’s Certificate in form and substance reasonably satisfactory to the Trustee (which shall include the
statements set forth in Section 11.05) 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 and substance reasonably satisfactory to the Trustee (which shall include the
statements set forth in Section 11.05) stating that, in the opinion of such counsel, all such conditions precedent have been
complied with.
SECTION 11.05. Statements Required in Certificate and Opinion .
Each certificate and opinion with respect to compliance by or on behalf of the Issuer or any Guarantor with a condition or covenant
provided for in this Indenture (other than the Officer’s Certificate required by Sections 3.01 or 4.04) shall comply with the
requirements of the Trust Indenture Act and any other requirements set forth in this Indenture and shall include:
a statement that the Person making such certificate or opinion has read such covenant or condition and the
definitions herein relating thereto;
(1)
(2)
opinions contained in such certificate or opinion are based;
a brief statement as to the nature and scope of the examination or investigation upon which the statements or
(3)
a statement that, in the opinion of such Person, it or he or she has made such examination or investigation as
is necessary to enable it or him or her to express an informed opinion as to whether or not such covenant or condition has been
complied with; and
(4)
a statement as to whether or not, in the opinion of such Person, such covenant or condition has been
complied with; provided , however , that with respect to such matters of fact an Opinion of Counsel may rely on an Officer’s
Certificate or certificate of public officials, and provided , further , that an Opinion of Counsel may have customary
qualifications for opinions of the type required.
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SECTION 11.06. Rules by Trustee and Agents .
The Trustee may make reasonable rules for action by or meetings of Holders. The Registrar and Paying Agent may make reasonable
rules for their functions.
SECTION 11.07. Business Days .
If a payment date is not a Business Day, payment may be made on the next succeeding Business Day, and no interest shall accrue for
the intervening period.
SECTION 11.08. Governing Law .
This Indenture, the Notes and the Note Guarantees shall be governed by, and construed in accordance with, the laws of the
State of New York.
SECTION 11.09. Waiver of Jury Trial .
EACH OF THE ISSUER, THE GUARANTORS AND THE TRUSTEE HEREBY 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 TRANSACTIONS
CONTEMPLATED HEREBY.
SECTION 11.10. Force Majeure .
In no event shall the Trustee, Paying Agent, Registrar or Transfer Agent be responsible or liable for any failure or delay in the
performance of its obligations under this Indenture arising out of or caused by, directly or indirectly, forces beyond its reasonable
control, including without limitation strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances,
nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer
(software or hardware) services.
SECTION 11.11. No Adverse Interpretation of Other Agreements .
This Indenture may not be used to interpret another indenture, loan, security or debt agreement of the Issuer or any Subsidiary. No
such indenture, loan, security or debt agreement may be used to interpret this Indenture.
SECTION 11.12. No Recourse Against Others .
No recourse for the payment of the principal of or premium, if any, or interest, on any of the Notes, or for any claim based thereon or
otherwise in respect thereof, and no recourse under or upon any obligation, covenant or agreement of the Issuer or any Guarantor in
this Indenture or in any supplemental indenture, or in any of the Notes, or because of the creation of any Indebtedness represented
thereby, shall be had against any stockholder, officer, director or employee, as such, past, present or future, of the Issuer or of any
successor corporation or against the property or assets of any such stockholder, officer, employee or director, either directly or
95
through the Issuer or any Guarantor, or any successor corporation thereof, whether by virtue of any constitution, statute or rule of law,
or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that this Indenture and the Notes are
solely obligations of the Issuer and the Guarantors, and that no such personal liability whatever shall attach to, or is or shall be
incurred by, any stockholder, officer, employee or director of the Issuer or any Guarantor, or any successor corporation thereof,
because of the creation of the indebtedness hereby authorized, or under or by reason of the obligations, covenants or agreements
contained in this Indenture or the Notes or implied there from, and that any and all such personal liability of, and any and all claims
against every stockholder, officer, employee and director, are hereby expressly waived and released as a condition of, and as a
consideration for, the execution of this Indenture and the issuance of the Notes. It is understood that this limitation on recourse is
made expressly for the benefit of any such shareholder, employee, officer or director and may be enforced by any of them.
SECTION 11.13. Successors .
All agreements of the Issuer and the Guarantors in this Indenture and the Notes shall bind their respective successors. All agreements
of the Trustee, any additional trustee and any Paying Agents in this Indenture shall bind its successor.
SECTION 11.14. Multiple Counterparts .
The parties may sign multiple counterparts of this Indenture. Each signed counterpart shall be deemed an original, but all of them
together represent one and the same agreement.
SECTION 11.15. Table of Contents, Headings, etc .
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 to be considered a part hereof, and shall in no way modify or restrict any of the terms or
provisions hereof.
SECTION 11.16. Separability .
Each provision of this Indenture shall be considered separable and if for any reason any provision which is not essential to the
effectuation of the basic purpose of this Indenture or the Notes 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.
SECTION 11.17. USA Patriot Act
The parties hereto acknowledge that in accordance with Section 326 of the USA Patriot Act the Trustee and Agents, like all financial
institutions and in order to help fight the funding of terrorism and money laundering, are required to obtain, verify, and record
information that identifies each person or legal entity that establishes a relationship or opens an account. The parties to this agreement
agree that they shall provide the Trustee and the Agents with such information as they may request in order to satisfy the
requirements of the USA Patriot Act.
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The Issuer has agreed to qualify this Indenture under the TIA in accordance with the terms and conditions of the Registration Rights
Agreement and to pay all reasonable costs and expenses (including attorneys’ fees and expenses for the Issuers, the Trustee and the
Holders) incurred in connection therewith to the extent set forth in the Registration Rights Agreement, including, but not limited to,
costs and expenses of qualification of this Indenture and the Notes and printing this Indenture and the Notes. The Trustee shall be
entitled to receive from the Issuer any such Officer’s Certificates, Opinions of Counsel or other documentation as it may reasonably
request in connection with any such qualification of this Indenture under the TIA.
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IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed all as of the date and year first written above.
MATCH GROUP, INC.
By: /s/ NICK STOUMPAS
Name: Nick Stoumpas
Title: Vice President and Treasurer
COMPUTERSHARE TRUST COMPANY, N.A.
as Trustee
By: /s/ JOHN M. WAHL
Name: John M. Wahl
Title: Corporate Trust Officer
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[FORM OF FACE OF GLOBAL NOTE]
[Global Notes Legend]
EXHIBIT A
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN
ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST
HEREIN, THE ACQUIRER
(1)
REPRESENTS THAT
(A)
IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A “QUALIFIED INSTITUTIONAL
BUYER” (WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT
EXERCISES SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT, OR
(B)
IT IS NOT A “U.S. PERSON” AND IS OUTSIDE OF THE UNITED STATES (WITHIN THE
MEANING OF REGULATION S UNDER THE SECURITIES ACT) AND
(2)
AGREES FOR THE BENEFIT OF MATCH GROUP, INC. THAT IT WILL NOT OFFER, SELL,
PLEDGE OR OTHERWISE TRANSFER THIS NOTE OR ANY BENEFICIAL INTEREST HEREIN, EXCEPT IN
ACCORDANCE WITH THE SECURITIES ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF
THE UNITED STATES AND ONLY
(A) TO MATCH GROUP, INC.,
(B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE UNDER
THE SECURITIES ACT,
(C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT,
(D) IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT,
(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
A- 1
EACH CASE IN A MINIMUM PRINCIPAL AMOUNT OF SECURITIES OF
$250,000, OR
(F) PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER
THE SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.
PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE WITH (2)(C) ABOVE OR (2)(D) ABOVE, A
DULY COMPLETED AND SIGNED CERTIFICATE (THE FORM OF WHICH MAY BE OBTAINED FROM THE TRUSTEE)
MUST BE DELIVERED TO THE TRUSTEE. PRIOR TO THE REGISTRATION OF ANY TRANSFER IN ACCORDANCE
WITH (F) ABOVE, MATCH GROUP, INC. RESERVES THE RIGHT TO REQUIRE THE DELIVERY OF SUCH LEGAL
OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY REASONABLY BE REQUIRED IN ORDER TO
DETERMINE THAT THE PROPOSED TRANSFER IS BEING MADE IN COMPLIANCE WITH THE SECURITIES ACT AND
APPLICABLE STATE SECURITIES LAWS. NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY RULE
144 EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
THIS NOTE IS ISSUED WITH ORIGINAL ISSUE DISCOUNT (“OID”) AS DEFINED IN SECTION 1273 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED. FOR INFORMATION REGARDING THE ISSUE DATE, THE ISSUE
PRICE, THE YIELD TO MATURITY AND THE AMOUNT OF OID, IF ANY, PER $1.00 OF PRINCIPAL AMOUNT OF THIS
NOTE PLEASE CONTACT THE COMPANY AT MATCH GROUP, INC., 555 WEST 18TH STREET, NEW YORK, NEW YORK
10011, ATTENTION: TREASURER.
[Restricted Notes Legend for Notes Offered Otherwise than in Reliance on Regulation S]
THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION
UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “ SECURITIES A CT”), AND THIS NOTE
MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS NOTE IS HEREBY NOTIFIED THAT THE
SELLER OF THIS NOTE MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE
SECURITIES ACT PROVIDED BY RULE 144A THEREUNDER.
THE HOLDER OF THIS NOTE AGREES FOR THE BENEFIT OF THE ISSUER THAT (A) THIS SECURITY MAY BE
OFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED, ONLY (I) TO THE ISSUER, (II) WITHIN THE UNITED
STATES TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (III) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH
A- 2
RULE 904 UNDER THE SECURITIES ACT, (IV) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (V) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH OF CASES (I) THROUGH (V) IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER SHALL,
AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF THIS NOTE FROM IT OF THE
RESALE RESTRICTIONS REFERRED TO IN (A) ABOVE.
[Restricted Notes Legend for Notes Offered in Reliance on Regulation S.]
THIS NOTE (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A TRANSACTION ORIGINALLY EXEMPT FROM
REGISTRATION UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE “ SECURITIES ACT ”), AND MAY
NOT BE TRANSFERRED IN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, ANY U.S. PERSON
EXCEPT PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT AND ALL APPLICABLE STATE SECURITIES LAWS. TERMS USED ABOVE HAVE THE MEANINGS
GIVEN TO THEM IN REGULATION S UNDER THE SECURITIES ACT.
IN CONNECTION WITH ANY TRANSFER, THE HOLDER SHALL 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 Notes Legend]
A- 3
FORM OF GLOBAL INITIAL
NOTE
[ ] 1
[ ] 2
MATCH GROUP, INC.
CUSIP
ISIN
No. $
6.75% SENIOR NOTE DUE 2022
MATCH GROUP, INC., a Delaware corporation (the
“Company”), for value received, promises to pay to CEDE &
CO. or registered assigns the principal sum of dollars on
December 15, 2022.
Interest Payment Dates: June 15 and December 15. Record
Dates: June 1 and December 1.
Reference is made to the further provisions of this Note
contained herein, which shall for all purposes have the same
effect as if set forth at this place.
1
2
Rule 144A Note: 57665R AA4 Regulation S Note:
57665R AC0
Rule 144A Note: US57665RAA41 Regulation S Note:
US57665RAC07
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually or by facsimile by its duly authorized officer.
MATCH GROUP, INC.
A- 4
Dated:
By: Name:
Title:
A- 5
Certificate of Authentication
This is one of the 6.75% Senior Notes due 2022 referred to in the within-mentioned Indenture.
COMPUTERSHARE TRUST COMPANY, N.A.,
as Trustee
By:
Dated:
A- 6
[FORM OF REVERSE OF GLOBAL INITIAL NOTE] MATCH GROUP, INC.
6.75% SENIOR NOTE DUE 2022
1.
Interest .
MATCH GROUP, INC., a Delaware corporation (the “ Company ”), promises to pay, until the principal hereof is paid or made
available for payment, interest (including Additional Interest, if any) on the principal amount set forth on the face hereof at a rate of
6.75% per annum. Interest hereon shall accrue from and including the most recent date to which interest has been paid or, if no
interest has been paid, from and including November 16, 2015 to but excluding the date on which interest is paid. Interest shall be
payable in arrears on each June 15 and December 15 commencing on June 15, 2016. Interest (including Additional Interest) shall be
computed on the basis of a 360-day year of twelve 30-day months. The Company shall pay interest on overdue principal and on
overdue interest (to the full extent permitted by law) at a rate of 6.75% per annum.
In addition to the rights provided to Holders of the Notes under the Indenture, Holders of Registrable Notes (as defined in the
Registration Rights Agreement) shall have all rights set forth in the Registration Rights Agreement, dated as of November 16, 2015,
between the Company and the Dealer Managers (the “Registration Rights Agreement”), including the right to receive Additional
Interest pursuant to the Registration Rights Agreement in certain circumstances. If applicable, Additional Interest payable pursuant to
the Registration Rights Agreement shall be paid to the same Persons, in the same manner and at the same times as regular interest.
Method of Payment . The Company shall pay interest hereon (except defaulted interest) and Additional Interest, if any, to
2.
the Persons who are registered Holders at the close of business on June 1 or December 1 next preceding the interest payment date
(whether or not a Business Day). Holders must surrender Notes to a Paying Agent to collect principal payments. The Company
(through the Paying Agent) shall pay principal and interest (including Additional Interest, if any) in money of the United States of
America that at the time of payment is legal tender for payment of public and private debts. If the Holder has given wire transfer
instructions to the Company at least ten Business Days prior to the payment date, the Company (through the Paying Agent) shall
make all payments on this Note by wire transfer of immediately available funds to the account specified in those instructions.
Otherwise, payments on this Note shall be made at the office or agency of the Paying Agent unless the Company (with notice to the
Paying Agent) elects to make interest payments by check mailed to the Holders at their addresses set forth in the register of Holders.
Paying Agent and Registrar . Initially, Computershare Trust Company, N.A., a national banking association (the “ Trustee
3.
”), shall act as a Paying Agent and Registrar. The Company may appoint and change any Paying Agent or Registrar or co-registrar
without notice. The Company or any of its Affiliates may act as Paying Agent or Registrar.
A- 7
Indenture . The Company issued the Notes under an Indenture dated as of November 16, 2015 (the “ Indenture ”) between
4.
the Company and the Trustee. This is one of an issue of Notes of the Company issued, or to be issued, under the Indenture. The Notes
include (i) $445,172,000 aggregate principal amount of the Company’s 6.75% Senior Notes due 2022 (the “ Initial Notes ”), (ii) if and
when issued, additional Notes that may be issued from time to time under the Indenture subsequent to November 16, 2015 (the “
Additional Notes ”) and (iii) if and when issued, the Company’s 6.75% Senior Notes due 2022 that may be issued from time to time
under the Indenture in exchange for Initial Notes or Additional Notes in an offer registered under the Securities Act as provided in the
Registration Rights Agreement (herein called “ Exchange Notes ”). The Initial Notes, the Additional Notes and the Exchange Notes
shall be considered collectively as a single class for all purposes of the Indenture. The terms of the Notes include those stated in the
Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb), as
amended from time to time. The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a
statement of them. Capitalized and certain other terms used herein and not otherwise defined have the meanings set forth in the
Indenture.
5.
redemption payments with respect to the Notes.
6.
Mandatory Redemption . Except as set forth in paragraph 8 below, the Company shall not be required to make mandatory
Optional Redemption . Except as set forth below, the Issuer will not be entitled to redeem the Notes at its option.
(i)
At any time prior to December 15, 2017, the Issuer may redeem all or a part of the Notes, upon notice as
described in Section 3.03 of the Indenture, 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 and Additional Interest, if any, to but not including the
date of redemption (the “ Redemption Date ”), subject to the rights of Holders of Notes on the relevant record date to receive
interest due on the relevant interest payment date.
(ii)
On and after December 15, 2017, the Issuer may redeem the Notes, in whole or in part, upon notice as
described in Section 3.03 of the Indenture, at the redemption prices (expressed as percentages of principal amount of the Notes
to be redeemed) set forth below, plus accrued and unpaid interest thereon and Additional Interest, if any, to but not including
the applicable Redemption Date, subject to the right of Holders of Notes of record on the relevant record date to receive
interest due on the relevant interest payment date, if redeemed during the twelve-month period beginning on December 15, of
each of the years indicated below:
Year
2017 ...................................................................................................
2018 ...................................................................................................
2019 ...................................................................................................
2020 and thereafter ............................................................................
A- 8
Percentage
102.375%
101.583%
100.792%
100.000%
Notice of Redemption . Notice of redemption shall be mailed, or delivered electronically if held by DTC, at least 30 days
7.
but not more than 60 days before the Redemption Date to each Holder to be redeemed at his registered address, except that
redemption notices may be mailed, or delivered electronically if held by DTC, more than 60 days prior to a Redemption Date if the
notice is issued in connection with a satisfaction and discharge of the Indenture. On and after the Redemption Date, unless the
Company defaults in making the redemption payment, interest ceases to accrue on Notes or portions thereof called for redemption.
Offers to Purchase . The Indenture provides that upon the occurrence of a Change of Control Triggering Event and subject
8.
to further limitations contained therein, the Company shall make an offer to purchase outstanding Notes in accordance with the
procedures set forth in the Indenture.
Denominations, Transfer, Exchange . The Notes are in registered form without coupons in denominations of $2,000 and
10.
integral multiples of $1,000. A Holder may transfer or exchange Notes in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay to it any taxes and fees required
by law or permitted by the Indenture. The Registrar need not register the transfer of or exchange of any Notes or a portion of a Note
selected for redemption for a period of 15 days before a mailing or electronic delivery of notice of redemption.
11.
Persons Deemed Owners . The registered Holder of this Note may be treated as the owner of this Note for all purposes.
Amendment, Supplement, Waiver, etc . The Company, the Guarantors and the Trustee (if a party thereto) may, without the
12.
Unclaimed Money . If money for the payment of principal or interest or Additional Interest, if any, remains unclaimed for
two years, the Trustee shall pay the money back to the Company at its written request. After that, Holders entitled to the money must
look to the Company for payment as general creditors unless an “abandoned property” law designates another Person.
13.
consent of the Holders of any outstanding Notes, amend, waive or supplement the Indenture or the Notes for certain specified
purposes, including, among other things, curing ambiguities, defects or inconsistencies, maintaining the qualification of the Indenture
under the Trust Indenture Act of 1939, as amended, and making any change that does not materially adversely affect the rights of any
Holder. Other amendments and modifications of the Indenture or the Notes may be made by the Company, the Guarantors and the
Trustee with the consent of the Holders of not less than a majority of the aggregate principal amount of the outstanding Notes, subject
to certain exceptions requiring the consent of the Holders of the particular Notes to be affected.
14.
(8) of Section 6.01 of the Indenture with respect to the Company or any Significant Subsidiary occurs, all outstanding Notes shall
become due and payable without any further action or notice. If any other Event of Default (other than an Event of Default specified
in clause (7) or (8) of Section 6.01 of the Indenture with respect to the
Defaults and Remedies . Events of Default are set forth in the Indenture. If an Event of Default specified in clause (7) or
A- 9
Company or any Significant Subsidiary), shall have occurred and be continuing hereunder, the Trustee, by written notice to the
Company, or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding by written notice to the
Company and the Trustee, may declare all amounts owing under the Notes to be due and payable. The Trustee may require indemnity
satisfactory to it before it enforces the Indenture or the Notes. Subject to certain limitations, Holders of a majority in principal amount
of the then outstanding Notes may direct the Trustee in its exercise of any trust or power.
Trustee Dealings with Company . The Trustee in its individual or any other capacity may become the owner or pledgee of
15.
Notes and may make loans to, accept deposits from, perform services for or otherwise deal with either of the Company or any
Guarantor, or any Affiliates thereof, with the same rights it would have if it were not Trustee.
Discharge . Subject to certain conditions and as set forth in the Indenture, the Company at any time may terminate some or
16.
all of its obligations pursuant to the Indenture, upon the payment of all the Notes or upon the irrevocable deposit with the Trustee of
United States dollars or U.S. Government Obligations sufficient to pay when due principal of and interest on the Notes to maturity or
redemption, as the case may be.
Guarantees . The Note shall be entitled to the benefits of Note Guarantees, if any, made for the benefit of the Holders.
17.
Reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties and obligations
thereunder of the Guarantors, if any, the Trustee and the Holders, and for events causing release of the Guarantors, if any, from the
Note Guarantees, if any.
18.
side of this Note.
Authentication . This Note shall not be valid until the Trustee manually signs the certificate of authentication on the other
19.
Governing Law . This Note shall be governed by and construed in accordance with the laws of the State of New York.
Abbreviations . Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (=
20.
tenants in common), TENANT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in
common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
21.
CUSIP/ISIN Numbers . Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP/ISIN numbers to be printed on the Notes and the Trustee may use CUSIP/ISIN numbers
in notices of redemption as a convenience to 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.
A- 10
The Company shall furnish to any Holder upon written request and without charge a copy of the Indenture and the Registration Rights
Agreement. Requests may be made to:
MATCH GROUP, INC.
555 West 18 th Street
New York, New York 10011 Attention: General Counsel
A- 11
I or we assign and transfer this Note to:
(Insert assignee’s social security or tax I.D. number)
ASSIGNMENT
(Print or type name, address and zip code of assignee) and irrevocably appoint:
Agent to transfer this Note on the books of the Company. The Agent may substitute another to act for him.
Date:
Your Signature: (Sign exactly as your name
appears on the other side of this Note)
Signature Guarantee:
SIGNATURE GUARANTEE
Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements
include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature
guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
In connection with any transfer of any of the Notes evidenced by this certificate occurring prior to the expiration of the period referred
to in Rule 144(k) under the Securities Act after the later of the date of original issuance of such Notes and the last date, if any, on
which such Notes were owned by the Issuer or any Affiliate of the Issuer, the undersigned confirms that such Notes are being
transferred in accordance with its terms:
CHECK ONE BOX BELOW
(1)
¨
to the Issuer; or
A- 12
(2) ¨
pursuant to an effective registration statement under the Securities Act of 1933; or
(3) ¨
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
(4) ¨
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; or
(5) ¨
pursuant to the exemption from registration provided by Rule 144 under the Securities Act of 1933.
Unless one of the boxes is checked, the Trustee shall 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 (4) or (5) is checked, the Trustee
shall be entitled to require, prior to registering any such transfer of the Notes, such legal opinions, certifications and other
information as the Issuer has 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.
Signature
Signature Guarantee:
Signature must be guaranteed
Signature
SIGNATURE GUARANTEE
Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which
requirements include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other
“signature guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance
with the Securities Exchange Act of 1934, as amended.
A- 13
TO BE COMPLETED BY PURCHASER IF (3) 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.
Dated:
Notice: To be executed by an executive officer
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by the Company pursuant to Section 4.14 of the Indenture, check the
appropriate box:
Section 4.14
If you want to have only part of the Note purchased by the Company pursuant to Section 4.14 of the Indenture, state the amount you
elect to have purchased:
$ ($2,000 or any integral multiple of $1,000)
Date:
Your Signature: (Sign exactly as your name appears on the face of this Note)
Signature Guaranteed
SIGNATURE GUARANTEE
Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements
include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature
guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
A- 15
[TO BE ATTACHED TO GLOBAL NOTES] SCHEDULE OF INCREASES OR DECREASES IN
GLOBAL NOTE
The following increases or decreases in this Global Note have been made:
Date of Exchange:
Amount of decrease in Principal amount of this Global Note:
Amount of increase in Principal amount of this Global Note:
Principal amount of this Global Note following such decrease or increase:
Signature of authorized officer of Trustee or Notes Custodian:
FORM OF TRANSFEREE LETTER OF REPRESENTATION
Match Group, Inc. 555 West 18 th Street
New York, New York 10011
Computershare Trust Company, N.A. 8742 Lucent Boulevard, Suite 225 Highlands Ranch, Colorado 80129
Attention: Corporate Trust Ladies and Gentlemen:
This certificate is delivered to request a transfer of US$ principal amount of the
6.75% Senior Notes due 2022 (the “ Notes ”) of Match Group, Inc., a Delaware corporation (the “ Company ”), issued pursuant to that
certain Indenture dated November 16, 2015 between the Company and Computershare Trust Company, N.A., as trustee.
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:
A- 17
1.
We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D 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 US$250,000 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.
We understand that the Notes have not been registered under the Securities Act and, unless so registered, may not be sold
2.
except as permitted in the following sentence. We agree, on our own behalf and on behalf of any investor account for which we
purchasing Notes, to offer, sell or otherwise transfer such Notes prior to the date that is two years after the later of the date of original
issue and the last date on which the Company or any affiliate of the Company was the owner of such Notes (or any predecessor
thereto) (the “ Resale Restriction Termination Date ”) only (a) to the Company, (b) pursuant to a registration statement that has been
declared effective under the Securities Act, (c) in a transaction complying with the requirements of Rule144A under the Securities Act
( “Rule 1 44A”) to a person we reasonably believe is a “qualified institutional buyer” under Rule 144A (a “ QIB”) that purchases for
its own account or for the account of a QIB and to whom notice is given that the transfer is being made in reliance on Rule 144A, (d)
pursuant to offers and sales that occur outside the United States within the meaning of Regulation S under the Securities Act or (e)
pursuant to any other available exemption from the registration requirements of the Securities Act, subject in each of the foregoing
cases to any requirements of law that the disposition of our property or the property of such investor account or accounts be at all
times within our or their control and in compliance with any applicable state securities laws. The foregoing restrictions on resale shall
not apply subsequent to the Resale Restriction Termination Date.
(Name of Transferee)
By: Name:
Title: Address: Date:
A- 18
[FORM OF FACE OF GLOBAL EXCHANGE NOTE]
[Global Notes Legend]
EXHIBIT B
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 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
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.
B- 1
CUSIP
ISIN
[ ] 3
[ ] 4
No. $
FORM OF GLOBAL EXCHANGE
NOTE
MATCH GROUP, INC.
6.75% SENIOR NOTE DUE
2022
MATCH GROUP, INC., a Delaware corporation (the
“Company”), for value received, promises to pay to CEDE &
CO. or registered assigns the principal sum of dollars on
December 15, 2022.
Interest Payment Dates: June 15 and December 15. Record
Dates: June 1 and December 1.
Reference is made to the further provisions of this Note
contained herein, which shall for all purposes have the same
effect as if set forth at this place.
3
4
Rule 144A Note: 57665R AA4 Regulation S Note:
57665R AC0
Rule 144A Note: US57665RAA41 Regulation S Note:
US57665RAC07
B- 2
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually or by facsimile by its duly authorized officer.
Dated:
MATCH GROUP, INC.
By: Name:
Title:
B- 3
Certificate of Authentication
This is one of the 6.75% Senior Notes due 2022 referred to in the within-mentioned Indenture.
COMPUTERSHARE TRUST COMPANY, N.A.,
as Trustee
By:
Dated:
B- 4
[FORM OF REVERSE OF GLOBAL EXCHANGE NOTE] MATCH GROUP, INC.
6.75% SENIOR NOTE DUE 2022
Interest . MATCH GROUP, INC., a Delaware corporation (the “ Company ”), promises to pay, until the principal hereof is
1.
paid or made available for payment, interest on the principal amount set forth on the face hereof at a rate of 6.75% per annum. Interest
hereon shall accrue from and including the most recent date to which interest has been paid or, if no interest has been paid, from and
including November 16, 2015 to but excluding the date on which interest is paid. Interest shall be payable in arrears on each June 15
and December 15 commencing on June 15, 2016. Interest shall be computed on the basis of a 360-day year of twelve 30-day months.
The Company shall pay interest on overdue principal and on overdue interest (to the full extent permitted by law) at a rate 6.75% per
annum.
Method of Payment . The Company shall pay interest hereon (except defaulted interest) to the Persons who are registered
2.
Holders at the close of business on June 1 or December 1 next preceding the interest payment date (whether or not a Business Day).
Holders must surrender Notes to a Paying Agent to collect principal payments. The Company (through the Paying Agent) shall pay
principal 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. If the Holder has given wire transfer instructions to the Company at least ten Business Days prior to the payment date,
the Company (through the Paying Agent) shall make all payments on this Note by wire transfer of immediately available funds to the
account specified in those instructions. Otherwise, payments on this Note shall be made at the office or agency of the Paying Agent
unless the Company (with notice to the Paying Agent) elects to make interest payments by check mailed to the Holders at their
addresses set forth in the register of Holders.
Paying Agent and Registrar . Initially, Computershare Trust Company, N.A., a national banking association (the “ Trustee
3.
”), shall act as a Paying Agent and Registrar. The Company may appoint and change any Paying Agent or Registrar or co-registrar
without notice. The Company or any of its Affiliates may act as Paying Agent or Registrar.
Indenture . The Company issued the Notes under an Indenture dated as of November 16, 2015 (the “ Indenture ”) between
4.
the Company and the Trustee. This is one of the Exchange Notes referred to in the Indenture. The Notes include (i) $445,172,000
aggregate principal amount of the Company’s 6.75% Senior Notes due 2022 (the “ Initial Notes ”) and (ii) if and when issued,
additional Notes that may be issued from time to time under the Indenture subsequent to November 16, 2015 (the “ Additional Notes
”). The Initial Notes, the Additional Notes and the Exchange Notes shall be considered collectively as a single class for all purposes of
the Indenture. The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa- 77bbbb), as amended from time to time. The Notes are subject to all such terms,
and Holders are referred to the Indenture and such Act for a statement of them. Capitalized and certain other terms used herein and
not otherwise defined have the meanings set forth in the Indenture.
B- 5
5.
redemption payments with respect to the Notes.
6.
Mandatory Redemption . Except as set forth in paragraph 8 below, the Company shall not be required to make mandatory
Optional Redemption . Except as set forth below, the Issuer will not be entitled to redeem the Notes at its option.
(i)
At any time prior to December 15, 2017, the Issuer may redeem all or a part of the Notes, upon notice as
described in Section 3.03 of the Indenture, 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 and Additional Interest, if any, to but not including the
date of redemption (the “ Redemption Date ”), subject to the rights of Holders of Notes on the relevant record date to receive
interest due on the relevant interest payment date.
(ii)
On and after December 15, 2017, the Issuer may redeem the Notes, in whole or in part, upon notice as
described in Section 3.03 of the Indenture, at the redemption prices (expressed as percentages of principal amount of the Notes
to be redeemed) set forth below, plus accrued and unpaid interest thereon and Additional Interest, if any, to but not including
the applicable Redemption Date, subject to the right of Holders of Notes of record on the relevant record date to receive
interest due on the relevant interest payment date, if redeemed during the twelve-month period beginning on December 15, of
each of the years indicated below:
Year
2017 ...................................................................................................
2018 ...................................................................................................
2019 ...................................................................................................
2020 and thereafter ............................................................................
Percentage
102.375%
101.583%
100.792%
100.000%
Notice of Redemption . Notice of redemption shall be mailed, or delivered electronically if held by DTC, at least 30 days
7.
but not more than 60 days before the Redemption Date to each Holder to be redeemed at his registered address, except that
redemption notices may be mailed, or delivered electronically if held by DTC, more than 60 days prior to a Redemption Date if the
notice is issued in connection with a satisfaction and discharge of the Indenture. On and after the Redemption Date, unless the
Company defaults in making the redemption payment, interest ceases to accrue on Notes or portions thereof called for redemption.
8.
to further limitations contained therein, the Company shall make an offer to purchase outstanding Notes in accordance with the
procedures set forth in the Indenture.
9.
integral multiples of $1,000. A Holder may transfer or exchange Notes in accordance with the Indenture. The Registrar may require a
Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay to it any taxes and
Offers to Purchase . The Indenture provides that upon the occurrence of a Change of Control Triggering Event and subject
Denominations, Transfer, Exchange . The Notes are in registered form without coupons in denominations of $2,000 and
B- 6
fees required by law or permitted by the Indenture. The Registrar need not register the transfer of or exchange of any Notes or a
portion of a Note selected for redemption for a period of 15 days before a mailing or electronic delivery of notice of redemption.
10.
Persons Deemed Owners . The registered Holder of this Note may be treated as the owner of this Note for all purposes.
11.
Unclaimed Money . If money for the payment of principal or interest remains unclaimed for two years, the Trustee shall
pay the money back to the Company at its written request. After that, Holders entitled to the money must look to the Company for
payment as general creditors unless an “abandoned property” law designates another Person.
Amendment, Supplement, Waiver, etc . The Company, the Guarantors and the Trustee (if a party thereto) may, without the
12.
consent of the Holders of any outstanding Notes, amend, waive or supplement the Indenture or the Notes for certain specified
purposes, including, among other things, curing ambiguities, defects or inconsistencies, maintaining the qualification of the Indenture
under the Trust Indenture Act of 1939, as amended, and making any change that does not materially adversely affect the rights of any
Holder. Other amendments and modifications of the Indenture or the Notes may be made by the Company, the Guarantors and the
Trustee with the consent of the Holders of not less than a majority of the aggregate principal amount of the outstanding Notes, subject
to certain exceptions requiring the consent of the Holders of the particular Notes to be affected.
Defaults and Remedies . Events of Default are set forth in the Indenture. If an Event of Default specified in clause (7) or
13.
(8) of Section 6.01 of the Indenture with respect to the Company or any Significant Subsidiary occurs, all outstanding Notes shall
become due and payable without any further action or notice. If any other Event of Default (other than an Event of Default specified
in clause (7) or (8) of Section 6.01 of the Indenture with respect to the Company or any Significant Subsidiary), shall have occurred
and be continuing hereunder, the Trustee, by written notice to the Company, or the Holders of at least 25% in aggregate principal
amount of the Notes then outstanding, by written notice to the Company and the Trustee, may declare all amounts owing under the
Notes to be due and payable. The Trustee may require indemnity satisfactory to it before it enforces the Indenture or the Notes.
Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Notes may direct the Trustee in its
exercise of any trust or power.
Trustee Dealings with Company . The Trustee in its individual or any other capacity may become the owner or pledgee of
14.
Notes and may make loans to, accept deposits from, perform services for or otherwise deal with either of the Company or any
Guarantor, or any Affiliates thereof, with the same rights it would have if it were not Trustee.
Discharge . Subject to certain conditions and as set forth in the Indenture, the Company at any time may terminate some or
15.
all of its obligations pursuant to the Indenture, upon the payment of all the Notes or upon the irrevocable deposit with the Trustee of
United States dollars or U.S. Government Obligations sufficient to pay when due principal of and interest on the Notes to maturity or
redemption, as the case may be.
B- 7
Guarantees . The Note shall be entitled to the benefits of Note Guarantees, if any, made for the benefit of the Holders.
16.
Reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties and obligations
thereunder of the Guarantors, if any, the Trustee and the Holders, and for events causing release of the Guarantors, if any, from the
Note Guarantees, if any.
17.
Note.
18.
Authentication . This Note shall not be valid until the Trustee signs the certificate of authentication on the other side of this
Governing Law . This Note shall be governed by and construed in accordance with the laws of the State of New York.
Abbreviations . Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (=
19.
tenants in common), TENANT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in
common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
20.
CUSIP/ISIN Numbers . Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused CUSIP/ISIN numbers to be printed on the Notes and the Trustee may use CUSIP/ISIN numbers
in notices of redemption as a convenience to 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.
The Company shall furnish to any Holder upon written request and without charge a copy of the Indenture and the Registration Rights
Agreement. Requests may be made to:
MATCH GROUP, INC.
555 West 18 th Street
New York, New York 10011 Attention: General Counsel
B- 8
I or we assign and transfer this Note to:
(Insert assignee’s social security or tax I.D. number)
ASSIGNMENT
(Print or type name, address and zip code of assignee) and irrevocably appoint:
Agent to transfer this Note on the books of the Company. The Agent may substitute another to act for him.
Date:
Your Signature: (Sign exactly as your name
appears on the other side of this Note)
Signature Guarantee:
Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements
include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature
guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
SIGNATURE GUARANTEE
B- 9
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have all or any part of this Note purchased by the Company pursuant to Section 4.14 of the Indenture, check the
appropriate box:
Section 4.14
If you want to have only part of the Note purchased by the Company pursuant to Section 4.14 of the Indenture, state the amount you
elect to have purchased:
$ ($2,000 or any integral multiple of $1,000)
Date:
Your Signature: (Sign exactly as your name appears on the face of this Note)
Signature Guaranteed
Signatures must be guaranteed by an “eligible guarantor institution” meeting the requirements of the Registrar, which requirements
include membership or participation in the Security Transfer Agent Medallion Program (“STAMP”) or such other “signature
guarantee program” as may be determined by the Registrar in addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.
SIGNATURE GUARANTEE
B- 10
[TO BE ATTACHED TO GLOBAL NOTES] SCHEDULE OF INCREASES OR DECREASES IN
GLOBAL NOTE
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 of increase:
Signature of authorized officer of Trustee of Notes Custodian:
B- 11
FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH
TRANSFERS PURSUANT TO REGULATION S
EXHIBIT C
[Date]
Attention:
Re: Match Group, Inc.
6.75% Senior Notes due 2022
(the “Securities”)
Ladies and Gentlemen:
In connection with our proposed sale of $[ ] aggregate principal amount of the Securities, we confirm that such sale has been
effected pursuant to and in accordance with Regulation S under the U.S. Securities Act of 1933, as amended (the “ Securities A ct”),
and, accordingly, we represent that:
(1)
the offer of the Securities was not made to a person in the United States;
(2)
either (a) at the time the buy offer was originated, the transferee was outside the United States or we and
any person acting on our behalf reasonably believed that the transferee was outside the United States, or (b) the transaction
was executed in, on or through the facilities of a designated offshore securities market and neither we nor any person acting on
our behalf knows that the transaction has been prearranged with a buyer in the United States;
(3)
no directed selling efforts have been made in the United States in contravention of the requirements of Rule
903 or Rule 904 of Regulation S, as applicable;
and
(4)
(5)
the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act;
we have advised the transferee of the transfer restrictions applicable to the Securities.
You and the Issuer are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to
any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Terms
used in this certificate have the meanings set forth in Regulation S.
C- 1
Very truly yours, [Name of Transferor]
By:
Authorized Signature
C- 2
Exhibit 4.2
Execution Version
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT dated November 16, 2015 (the “ Agreement ”) is entered into by and among
Match Group, Inc. (the “ Company ”), a Delaware corporation, Merrill Lynch, Pierce, Fenner & Smith Incorporated (“ Merrill Lynch
”), J.P. Morgan Securities LLC (“ J.P. Morgan ”), Goldman, Sachs & Co. (“ Goldman ”), BNP Paribas Securities Corp. (“ BNPP ”),
BMO Capital Markets Corp. (“ BM O”), Deutsche Bank Securities Inc. (“ DB ”), PNC Capital Markets LLC (“ PNC ”), Fifth Third
Securities, Inc. (“ Fifth Third ”) and SG Americas Securities, LLC (“ SG ” and, together with Merrill Lynch, J.P. Morgan, Goldman,
BNPP, BMO, DB, PNC, Fifth Third, the “ Dealer Managers ”).
The Company and the Dealer Managers are parties to the Dealer Manager Agreement (the “ Dealer Manager Agreement ”)
dated October 16, 2015, which provides for the offer to exchange any and all outstanding 4.75% Senior Notes due 2022 Issued by
IAC/InterActiveCorp for 6.75% Senior Notes due 2022 Issued by Match Group, Inc. (the “ Securities ”).
The Securities will be issued by the Company pursuant to the Indenture, dated as of the date hereof, and as the same may be
amended from time to time in accordance with the terms thereof (the " Indenture "), between the Company and Computershare Trust
Company, N.A., as trustee (" Trustee ").
As an inducement to the Dealer Managers to enter into the Dealer Manager Agreement, the Company has agreed to provide to
the Dealer Managers and their direct and indirect transferees the registration rights set forth in this Agreement. The execution and
delivery of this Agreement is a condition to the closing under the Dealer Manager Agreement.
In consideration of the foregoing, the parties hereto agree as follows:
1.
Definitio ns. As used in this Agreement, the following terms shall have the following meanings:
“Additional Interest” shall have the meaning set forth in Section 2(d).
“Business Day” shall mean any day that is not a Saturday, Sunday or other day on which commercial banks in New York City
are authorized or required by law to remain closed.
“Company” shall have the meaning set forth in the preamble and shall also include the Company’s successors.
“Dealer Managers” shall have the meaning set forth in the preamble.
“Dealer Manager Agreement” shall have the meaning set forth in the preamble.
1
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from time to time.
“Exchange Dates” shall have the meaning set forth in Section 2(a)(ii) hereof.
“Exchange Offer” shall mean the exchange offer by the Company of Exchange Securities for Registrable Securities pursuant
to Section 2(a) hereof.
“Exchange Offer Registration” shall mean a registration under the Securities Act effected pursuant to Section 2(a) hereof.
“Exchange Offer Registration Statement” shall mean an exchange offer registration statement on Form S-4 (or, if applicable,
on another appropriate form) and all amendments and supplements to such registration statement, in each case including the
Prospectus contained therein or deemed a part thereof, all exhibits thereto and any document incorporated by reference therein.
“Exchange Securities” shall mean senior notes issued by the Company under the Indenture containing terms identical to the
Securities (except that the Exchange Securities will not be subject to restrictions on transfer or to any increase in interest rate for
failure to comply with this Agreement) and to be offered to Holders of Registrable Securities in exchange for Securities pursuant to
the Exchange Offer.
“First Supplement to Offering Memorandum and Consent Solicitation Statement” means that first supplement to offering
memorandum and consent solicitation statement, dated October 27, 2015.
“Free Writing Prospectus” means each free writing prospectus (as defined in Rule 405 under the Securities Act) prepared by or
on behalf of the Company or used or referred to by the Company in connection with the sale of the Securities or the Exchange
Securities.
“Holders” shall mean each of the registered holders of IAC Notes exchanging their IAC Notes on the Settlement Date and each
of their successors, assigns and direct and indirect transferees who become owners of Registrable Securities under the Indenture;
provided that for purposes of Section 4 and Section 5 of this Agreement, the term “Holders” shall include Participating Broker-
Dealers.
“IAC Indenture” means that indenture dated December 21, 2012 among IAC/InterActiveCorp, the guarantors party thereto and
Computershare Trust Company, N.A., as trustee.
“IAC Notes” means the $500.0 million aggregate principal amount of 4.75% senior notes due 2022 of IAC/InterActiveCorp
issued pursuant to the IAC Indenture.
“Indemnified Person” shall have the meaning set forth in Section 5(c) hereof. “Indemnifying Person” shall have the meaning
set forth in Section 5(c) hereof.
2
“Indenture” shall have the meaning set forth in the preamble. “Inspector” shall have the meaning set forth in Section 3(a)(xiii)
hereof.
“Issuer Information” shall have the meaning set forth in Section 5(a) hereof.
“Majority Holders” shall mean the Holders of a majority of the aggregate principal amount of the outstanding Registrable
Securities; provided that whenever the consent or approval of Holders of a specified percentage of Registrable Securities is required
hereunder, any Registrable Securities owned directly or indirectly by the Company or any of its affiliates shall not be counted in
determining whether such consent or approval was given by the Holders of such required percentage or amount; and provided , further
, that if the Company shall issue any additional Securities under the Indenture prior to consummation of the Exchange Offer or, if
applicable, the effectiveness of any Shelf Registration Statement, such additional Securities and the Registrable Securities to which
this Agreement relates shall be treated together as one class for purposes of determining whether the consent or approval of Holders of
a specified percentage of Registrable Securities has been obtained.
“Merrill Lynch” shall have the meaning set forth in the preamble.
“Notice and Questionnaire” shall mean a notice of registration statement and selling security holder questionnaire distributed
to a Holder by the Company upon receipt of a Shelf Request from such Holder.
“Offering Memorandum” means the confidential offering memorandum and consent solicitiation statement, dated as of
October 16, 2015, relating to the Company’s offer to exchange the Securities for any and all outstanding IAC Notes, as supplemented
by the First Supplement to Offering Memorandum and Consent Solicitation Statement.
“Participating Broker-Dealers” shall have the meaning set forth in Section 4(a) hereof. “Participating Holder” shall mean any
Holder of Registrable Securities that has returned a
completed and signed Notice and Questionnaire to the Company in accordance with Section 2(b) hereof.
“Person” shall mean an individual, partnership, limited liability company, corporation, trust or unincorporated organization, or
a government or agency or political subdivision thereof.
“Prospectus” shall mean the prospectus included in, or, pursuant to the rules and regulations of the Securities Act, deemed a part of, a
Registration Statement, including any preliminary prospectus, and any such prospectus as amended or supplemented by any prospectus
supplement, including a prospectus supplement with respect to the terms of the offering of any portion of the Registrable Securities covered by
a Shelf Registration Statement, and by all other amendments and supplements to such prospectus, and in each case including any document
incorporated by reference therein.
“Registrable Securities” shall mean the Securities; provided that the Securities shall cease to be Registrable Securities (i) when a
Registration Statement with respect to such Securities has
3
become effective under the Securities Act and such Securities have been exchanged or disposed of pursuant to such Registration
Statement, (ii) when such Securities cease to be outstanding, (iii) if, when the Exchange Offer is consummated, on or after the
Exchange Date with respect to Holders that are eligible to participate in the Exchange Offer but fail to tender such Securities in the
Exchange Offer or (iv) on November 16, 2017.
“Registration Default” shall mean the occurrence of any of the following: (i) the Exchange Offer is not completed on or prior
to the Target Registration Date, (ii) the Shelf Registration Statement, if required pursuant to Section 2(b)(i) or Section 2(b)(ii) hereof,
has not become effective on or prior to the Target Registration Date, (iii) if the Company receives a Shelf Request pursuant to Section
2(b)(ii), the Shelf Registration Statement required to be filed thereby has not become effective by the later of (a) the Target
Registration Date and (b) 90 days after delivery of such Shelf Request or (iv) the Shelf Registration Statement, if required by this
Agreement, has become effective and thereafter either ceases to be effective or the Prospectus contained therein ceases to be usable, in
each case whether or not permitted by this Agreement, at any time during the Shelf Effectiveness Period, and such failure to remain
effective or usable exists for more than 30 days (whether or not consecutive) in any 12-month period; provided that the suspension of
a Registration Statement pursuant to notices provided by the Company in accordance with Section 3(d) hereof shall not constitute or
trigger a Registration Default.
“Registration Expenses” shall mean any and all expenses incident to performance of or compliance by the Company with this
Agreement, including without limitation: (i) all SEC, stock exchange or Financial Industry Regulatory Authority registration and
filing fees, (ii) all fees and expenses incurred in connection with compliance with state securities or blue sky laws (including
reasonable fees and disbursements of counsel for any Underwriters or Holders in connection with blue sky qualification of any
Exchange Securities or Registrable Securities), (iii) all expenses of any Persons in preparing or assisting in preparing, word
processing, printing and distributing any Registration Statement, any Prospectus and any amendments or supplements thereto, any
underwriting agreements or other similar agreements and any other documents relating to the performance of and compliance with this
Agreement, (iv) all rating agency fees,
(v) all fees and disbursements relating to the qualification of the Indenture under applicable securities laws, (vi) the fees and
disbursements of the Trustee and its counsel, (vii) the fees and disbursements of counsel for the Company and, in the case of a Shelf
Registration Statement, the reasonable fees and disbursements of one counsel for the Holders (which counsel shall be a nationally
recognized law firm experienced in securities law matters and which shall be selected by the Majority Holders and which counsel may
also be counsel for the Dealer Managers) and
(viii) the fees and disbursements of the independent registered public accountants of the Company, including the expenses of any
special audits or “comfort” letters required by or incident to the performance of and compliance with this Agreement, but excluding
fees and expenses of counsel to the Underwriters or the Holders (other than fees and expenses set forth in clauses (ii) or (vii) above)
and underwriting discounts and commissions, brokerage commissions and transfer taxes, if any, relating to the sale or disposition of
Registrable Securities by a Holder.
“Registration Statement” shall mean any registration statement of the Company that covers any of the Exchange Securities or
Registrable Securities pursuant to the provisions of this Agreement and all amendments and supplements to any such registration
statement, including
4
post-effective amendments, in each case including the Prospectus contained therein or deemed a part thereof, all exhibits thereto and
any document incorporated by reference therein.
“SEC” shall mean the United States Securities and Exchange Commission. “Securities” shall have the meaning set forth in the
preamble.
“Securities Act” shall mean the Securities Act of 1933, as amended from time to time. “Settlement Date” means November 16,
2015.
“Shelf Effectiveness Period” shall have the meaning set forth in Section 2(b) hereof.
“Shelf Registration” shall mean a registration effected pursuant to Section 2(b) hereof. “Shelf Registration Statement” shall
mean a “shelf” registration statement of the
Company that covers all or a portion of the Registrable Securities (but no other securities unless approved by a majority of the Holders
whose Registrable Securities are to be covered by such Shelf Registration Statement to the extent such Shelf Registration Statement is
not an automatic Shelf Registration Statement) on an appropriate form under Rule 415 under the Securities Act, or any similar rule
that may be adopted by the SEC, and all amendments and supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein or deemed a part thereof, all exhibits thereto and any document
incorporated by reference therein. For the avoidance of doubt, "Shelf Registration Statement" shall include any previously filed
registration statement of the Company that is amended or supplemented to satisfy the foregoing.
“Shelf Request” shall have the meaning set forth in Section 2(b) hereof. “Staff” shall mean the staff of the SEC.
“Target Registration Date” shall mean 360 days after November 16, 2015 (or if such date is not a Business Date, the next
succeeding Business Day).
“Trust Indenture Act” shall mean the Trust Indenture Act of 1939, as amended from time to time.
“Trustee” shall mean the trustee with respect to the Securities under the Indenture. “Underwriter” shall have the meaning set
forth in Section 3(e) hereof.
“Underwritten Offering” shall mean an offering in which Registrable Securities are sold to an Underwriter for reoffering to the
public.
2.
Registration Under the Securities Act . (a) To the extent not prohibited by any applicable law or applicable
interpretations of the Staff, the Company shall use commercially reasonable efforts to (i) cause to be filed an Exchange Offer
Registration Statement covering an offer to the Holders to exchange all the Registrable Securities for Exchange Securities and (ii)
5
have such Registration Statement become and remain effective until 180 days after the last Exchange Date for use by one or more
Participating Broker-Dealers. The Company shall commence the Exchange Offer promptly after the Exchange Offer Registration
Statement is declared effective by the SEC and use commercially reasonable efforts to complete the Exchange Offer not later than 60
days after such effective date.
The Company shall commence the Exchange Offer by mailing or delivering the related Prospectus and other accompanying
documents, if any, in compliance with the applicable procedures of the depositary holding the Securities stating, in addition to such
other disclosures as are required by applicable law, substantially the following:
(i)
(ii)
(iii)
(iv)
(v)
that the Exchange Offer is being made pursuant to this Agreement and that all Registrable Securities validly tendered and not
properly withdrawn will be accepted for exchange;
the dates of acceptance for exchange (which shall be a period of at least 20 Business Days from the date the Exchange Offer is
commenced) (the “ Exchange Dates ”);
that any Registrable Security not tendered will remain outstanding and continue to accrue interest but will not retain any rights
under this Agreement, except as otherwise specified herein;
that any Holder electing to have a Registrable Security exchanged pursuant to the Exchange Offer will be required to (A)
surrender such Registrable Security to the institution and at the address (located in the Borough of Manhattan, The City of
New York) and in the manner specified in the notice, or (B) effect such exchange otherwise in compliance with the applicable
procedures of the depositary for such Registrable Security, in each case prior to the close of business on the last Exchange
Date; and
that any Holder will be entitled to withdraw its election, not later than the close of business on the last Exchange Date, by (A)
delivering to the institution and at the address (located in the Borough of Manhattan, The City of New York) specified in the
notice, facsimile transmission or letter setting forth the name of such Holder, the principal amount of Registrable Securities
delivered for exchange and a statement that such Holder is withdrawing its election to have such Securities exchanged or (B)
effecting such withdrawal in compliance with the applicable procedures of the depositary for the Registrable Securities.
As a condition to participating in the Exchange Offer, a Holder will be required to represent to the Company that (i) any
Exchange Securities to be received by it will be acquired in the ordinary course of its business, (ii) at the time of the commencement
of the Exchange Offer it has no arrangement or understanding with any Person to participate in the distribution (within the meaning of
the Securities Act) of the Exchange Securities in violation of the provisions of the Securities Act, (iii) it is not an “affiliate” (within the
meaning of Rule 405 under the Securities Act) of the Company and (iv) if such Holder is a broker-dealer that will receive Exchange
Securities for its own account in exchange for Registrable Securities that were acquired as a result of market-making or other trading
activities, then such Holder will deliver a Prospectus
6
(or, to the extent permitted by law, make available a Prospectus to purchasers) in connection with any resale of such Exchange
Securities.
As soon as practicable after the last Exchange Date, the Company shall:
(i)
(ii)
accept for exchange Registrable Securities or portions thereof validly tendered and not properly withdrawn pursuant to the
Exchange Offer; and
deliver, or cause to be delivered, to the Trustee for cancellation all Registrable Securities or portions thereof so accepted for
exchange by the Company and issue, and cause the Trustee to promptly authenticate and deliver to each Holder, Exchange
Securities equal in principal amount to the principal amount of the Registrable Securities tendered by such Holder.
The Company shall use commercially reasonable efforts to complete the Exchange Offer as provided above and shall comply
with the applicable requirements of the Securities Act, the Exchange Act and other applicable laws and regulations in connection with
the Exchange Offer. The Exchange Offer shall not be subject to any conditions, other than that the Exchange Offer does not violate
any applicable law or applicable interpretations of the Staff.
(b)
In the event that (i) the Company determines that the Exchange Offer Registration provided for in Section 2(a)
hereof is not available or may not be completed as soon as practicable after the last Exchange Date because it would violate any
applicable law or applicable interpretations of the Staff, (ii) after the filing of the Exchange Offer Registration Statement with the
SEC, upon receipt of a written request (a “ Shelf Request ”) from any Dealer Manager or Holder representing that it holds Registrable
Securities that is prohibited by applicable law or SEC policy from participating in the Exchange Offer to be exchanged in the
Exchange Offer, the Company shall use commercially reasonable efforts to cause to be filed as soon as practicable after such
determination date or Shelf Request, as the case may be, a Shelf Registration Statement providing for the sale of all the Registrable
Securities by the Holders thereof and to have such Shelf Registration Statement become effective; provided that no Holder will be
entitled to have any Registrable Securities included in any Shelf Registration Statement, or entitled to use the prospectus forming a
part of such Shelf Registration Statement, until such Holder shall have delivered a completed and signed Notice and Questionnaire
and provided such other information regarding such Holder to the Company as is contemplated by Section 3(b) hereof.
In the event that the Company is required to file a Shelf Registration Statement pursuant to clause (ii) of the preceding
sentence, the Company shall use commercially reasonable efforts to file and have become effective both an Exchange Offer
Registration Statement pursuant to Section 2(a) hereof with respect to all Registrable Securities and a Shelf Registration Statement
(which may be a combined Registration Statement with the Exchange Offer Registration Statement) with respect to offers and sales of
Registrable Securities held by Participating Holders after completion of the Exchange Offer.
The Company agrees to use commercially reasonable efforts to keep the Shelf Registration Statement continuously effective
until the earlier of (x) the second anniversary of
7
the date hereof and (y) the Securities cease to be Registrable Securities (the " Shelf Effectiveness Perio d"). The Company further
agrees to supplement or amend the Shelf Registration Statement and the related Prospectus if required by the rules, regulations or
instructions applicable to the registration form used by the Company for such Shelf Registration Statement or by the Securities Act or
by any other rules and regulations thereunder or if reasonably requested in writing pursuant to the notice provision hereof by a Holder
of Registrable Securities with respect to information relating to such Holder prior to the end of the Shelf Effectiveness Period, and to
use commercially reasonable efforts to cause any such amendment to become effective, if required, and such Shelf Registration
Statement and Prospectus to become usable as soon as thereafter practicable. The Company agrees to furnish to the Participating
Holders copies of any such supplement or amendment promptly after its being used or filed with the SEC.
(c)
The Company shall pay all Registration Expenses in connection with any registration pursuant to Section 2(a) or
Section 2(b) hereof. Each Holder shall pay all underwriting discounts and commissions, brokerage commissions and transfer taxes, if
any, relating to the sale or disposition of such Holder’s Registrable Securities pursuant to the Shelf Registration Statement.
(d)
An Exchange Offer Registration Statement pursuant to Section 2(a) hereof will not be deemed to have become
effective unless it has been declared effective by the SEC or otherwise becomes effective pursuant to SEC rules. A Shelf Registration
Statement pursuant to Section 2(b) hereof will not be deemed to have become effective unless it has been declared effective by the
SEC or is automatically effective upon filing with the SEC as provided by Rule 462 under the Securities Act or otherwise becomes
effective pursuant to SEC rules.
If a Registration Default occurs, the interest rate on the applicable Registrable Securities will be increased by (i) 0.25% per
annum for the first 90-day period beginning on the day immediately following the day such Registration Default occurred and (ii) an
additional 0.25% per annum with respect to each subsequent 90-day period, in each case until and including the date such Registration
Default ends, up to a maximum increase of 1.00% per annum (collectively, the “ Additional Interest ”). A Registration Default ends
when the Securities cease to be Registrable Securities or, if earlier, (1) in the case of a Registration Default under clause (i) of the
definition thereof, when the Exchange Offer is completed, (2) in the case of a Registration Default under clause (ii) or clause (iii) of
the definition thereof, when the Shelf Registration Statement becomes effective or (3) in the case of a Registration Default under
clause (iv) of the definition thereof, when the Shelf Registration Statement again becomes effective or the Prospectus again becomes
usable. Notwithstanding the foregoing, (i) the Company shall not be required to pay additional interest in excess of the amount
described above because more than one Registration Default has occurred and is pending and (ii) a Holder of Registrable Securities
who is not entitled to the benefits of a Shelf Registration Statement shall not be entitled to additional interest with respect to a
Registration Default that pertains to a Registration Default relating to such Shelf Registration Statement.
(e)
Any amounts paid pursuant to Section 2(d) above shall be paid in cash semi- annually in arrears, with the first semi-
annual payment due on the first date an interest payment is made pursuant to the Indenture following the date of such Registration
Default.
8
3.
(i)
(f)
Without limiting the remedies available to the Dealer Managers and the Holders, the Company acknowledges that
any failure by the Company to comply with their obligations under Section 2(a) and Section 2(b) hereof may result in material
irreparable injury to the Dealer Managers or the Holders for which there is no adequate remedy at law, that it will not be possible to
measure damages for such injuries precisely and that, in the event of any such failure, the Dealer Managers or any Holder may obtain
such relief as may be required to specifically enforce the Company’s obligations under Section 2(a) and Section 2(b) hereof.
(g)
The Company represents, warrants and covenants that they (including its agents and representatives) will not
prepare, make, use, authorize, approve or refer to any Free Writing Prospectus.
the Company shall in accordance with the terms of this Agreement:
Registration Procedures . (a) In connection with their obligations pursuant to Section 2(a) and Section 2(b) hereof,
prepare and file with the SEC a Registration Statement on the appropriate form under the Securities Act, which form
(x) shall be selected by the Company, (y) shall, in the case of a Shelf Registration, be available for the sale of the Registrable
Securities by the Holders thereof and (z) shall comply as to form in all material respects with the requirements of the applicable form
and include all financial statements required by the SEC to be filed therewith; and use commercially reasonable efforts to cause such
Registration Statement to become effective and remain effective for the applicable period in accordance with Section 2 hereof;
(ii)
prepare and file with the SEC such amendments and post-effective amendments to each Registration Statement as
may be necessary to keep such Registration Statement effective (subject to the provisions of Section 3(d) hereof) for the applicable
period in accordance with Section 2 hereof and cause each Prospectus to be supplemented by any required prospectus supplement and,
as so supplemented, to be filed pursuant to Rule 424 under the Securities Act; and keep each Prospectus current during the period
described in Section 4(3) of and Rule 174 under the Securities Act that is applicable to transactions by brokers or dealers with respect
to the Registrable Securities or Exchange Securities;
(iii)
in the case of a Shelf Registration, furnish to each Participating Holder, to counsel for the Dealer Managers, to counsel for
such Participating Holders and to each Underwriter of an Underwritten Offering of Registrable Securities, if any, without charge, as many
copies of each Prospectus or preliminary prospectus, and any amendment or supplement thereto, as such Participating Holder, counsel or
Underwriter may reasonably request in order to facilitate the sale or other disposition of the Registrable Securities thereunder; and, subject to
Section 3(c) hereof, the Company consents to the use of such Prospectus or preliminary prospectus and any amendment or supplement thereto
in accordance with applicable law by each of the Holders of Registrable Securities and any such Underwriters in connection with the offering
and sale of the Registrable Securities covered by and in the manner described in such Prospectus or preliminary prospectus or any amendment
or supplement thereto in accordance with applicable law;
(iv)
use commercially reasonable efforts to register or qualify the Registrable Securities under all applicable state securities or
blue sky laws of such jurisdictions as any
9
Holder of Registrable Securities covered by a Registration Statement shall reasonably request in writing by the time the applicable
Registration Statement becomes effective; cooperate with such Holders in connection with any filings required to be made with the
Financial Industry Regulatory Authority; and do any and all other acts and things that may be reasonably necessary or advisable to
enable each Holder to complete the disposition in each such jurisdiction of the Registrable Securities owned by such Holder; provided
the Company shall not be required to (1) qualify as a foreign corporation or other entity or as a dealer in securities in any such
jurisdiction where it would not otherwise be required to so qualify, (2) file any general consent to service of process in any such
jurisdiction or (3) subject itself to taxation in any such jurisdiction if it is not so subject;
(v)
notify counsel for the Dealer Managers (such counsel being the counsel on the date of the Agreement unless the
Dealer Managers notify the Company in writing otherwise) and, in the case of a Shelf Registration, notify each Participating Holder
and counsel for such Participating Holders promptly and, if requested by any such Participating Holder or counsel, confirm such
advice in writing promptly (1) when a Registration Statement has become effective, when any post-effective amendment thereto has
been filed and becomes effective and when any amendment or supplement to the Prospectus has been filed, (2) of any request by the
SEC or any state securities authority for amendments and supplements to a Registration Statement or Prospectus or for additional
information, in each case after the Registration Statement has become effective, (3) of the issuance by the SEC or any state securities
authority of any stop order suspending the effectiveness of a Registration Statement or the initiation of any proceedings for that
purpose, including the receipt by the Company of any notice of objection of the SEC to the use of a Shelf Registration Statement or
any post-effective amendment thereto pursuant to Rule 401(g)(2) under the Securities Act, (4) if, between the applicable effective date
of a Shelf Registration Statement and the closing of any sale of Registrable Securities covered thereby, the representations and
warranties of the Company contained in any underwriting agreement, securities sales agreement or other similar agreement, if any,
relating to an offering of such Registrable Securities cease to be true and correct in all material respects or if the Company receives
any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the
initiation of any proceeding for such purpose, (5) of the happening of any event during the period a Registration Statement is effective
that makes any statement made in such Registration Statement or the related Prospectus untrue in any material respect or that requires
the making of any changes in such Registration Statement or Prospectus in order to make the statements therein not misleading and
(6) of any determination by the Company that a post-effective amendment to a Registration Statement or any amendment or
supplement to the Prospectus would be appropriate;
(vi)
use commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of a
Registration Statement or, in the case of a Shelf Registration, the resolution of any objection of the SEC pursuant to Rule 401(g)(2),
including by filing an amendment to such Shelf Registration Statement on the proper form, at the earliest possible moment and
provide prompt notice to each Participating Holder of the withdrawal of any such order or such resolution;
(vii)
in the case of a Shelf Registration, furnish to each Participating Holder, without charge, at least one conformed
copy of each Registration Statement and any post-effective
10
amendment thereto (without any documents incorporated therein by reference or exhibits thereto, unless reasonably requested), in
each case, if not available on EDGAR;
(viii)
in the case of a Shelf Registration, unless the Registrable Securities are in book- entry or global certificate only
form, cooperate (if applicable) with the Participating Holders to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold and not bearing any restrictive legends and enable such Registrable Securities to be
issued in such denominations and registered in such names (consistent with the provisions of the Indenture) as such Participating
Holders may reasonably request at least two Business Days prior to the closing of any sale of Registrable Securities;
(ix)
in the case of a Shelf Registration, upon the occurrence of any event contemplated by Section 3(a)(v)(5) hereof,
use commercially reasonable efforts to prepare and file with the SEC a supplement or post-effective amendment to such Shelf
Registration Statement or the related Prospectus or any document incorporated therein by reference or file any other required
document so that, as thereafter delivered (or, to the extent permitted by law, made available) to purchasers of the Registrable
Securities, such Prospectus will not contain any untrue statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were made, not misleading; and the Company shall notify (it
being understood and agreed that no such notice or any notice under Section 3(a)(v)(5) shall include any material non-public
information with respect to the relevant event) the Participating Holders to suspend use of the Prospectus as promptly as practicable
after the occurrence of such an event, and such Participating Holders hereby agree to suspend use of the Prospectus until the Company
has amended or supplemented the Prospectus to correct such misstatement or omission; provided the Company shall not be required to
take any action pursuant this Section 3(a)(ix) during any suspension period pursuant to Section 3(d) hereof;
(x)
in case of a Shelf Registration, a reasonable time prior to the filing of any Registration Statement, any Prospectus,
any amendment to a Registration Statement or amendment or supplement to a Prospectus or of any document that is to be
incorporated by reference into a Registration Statement or a Prospectus after initial filing of a Registration Statement (except for
current reports filed on Form 8-K filed in the ordinary course of business), provide copies of such document to Merrill Lynch and its
counsel (and, in the case of a Shelf Registration Statement, to the Holders of Registrable Securities and their counsel to the extent that
the Company has been provided with contact information for such counsel) and make such of the representatives of the Company as
shall be reasonably requested by the Dealer Managers or their counsel (and, in the case of a Shelf Registration Statement, the
Participating Holders or their counsel) available for discussion of such document at reasonable times and upon reasonable notice; and
the Company shall not, at any time after initial filing of a Registration Statement, use or file any Prospectus, any amendment of or
supplement to a Registration Statement or a Prospectus, or any document that is to be incorporated by reference into a Registration
Statement or a Prospectus, of which the Dealer Managers and their counsel (and, in the case of a Shelf Registration Statement, the
Holders of Registrable Securities and their counsel) shall not have previously been advised and furnished a copy or to which the
Dealer Managers or their counsel (and, in the case of a Shelf Registration Statement, the Holders of Registrable Securities or their
counsel) shall reasonably object;
11
(xi)
obtain a CUSIP number for all Exchange Securities or Registrable Securities in the case of a Shelf Registration, as
the case may be, not later than the initial effective date of a Registration Statement;
(xii)
cause the Indenture to be qualified under the Trust Indenture Act in connection with the registration of the
Exchange Securities or Registrable Securities, as the case may be; provide cooperation with the Trustee and the Holders to effect such
changes to the Indenture as may be required for the Indenture to be so qualified in accordance with the terms of the Trust Indenture
Act; and execute, and use commercially reasonable efforts to cause the Trustee to execute, all documents as may be required to effect
such changes and all other forms and documents required to be filed with the SEC to enable the Indenture to be so qualified in a
timely manner;
(xiii)
in the case of a Shelf Registration, make available for inspection by a representative of the Participating Holders
(an “ Inspector ”), any Underwriter participating in any disposition pursuant to such Shelf Registration Statement, any attorneys and
accountants designated by a majority of the Participating Holders and any attorneys and accountants designated by such Underwriter,
at reasonable times and in a reasonable manner, all pertinent financial and other records, documents and properties of the Company
and its subsidiaries, and cause the respective officers, directors and employees of the Company to supply all information reasonably
requested by any such Inspector, Underwriter, attorney or accountant in connection with a Shelf Registration Statement in each case,
as is customary for similar "due diligence" examinations of underwritten offerings; provided that if any such information is identified
by the Company as being confidential or proprietary, each Person receiving such information shall take such actions as are reasonably
necessary to protect the confidentiality of such information to the extent such action is otherwise not inconsistent with, an impairment
of or in derogation of the rights and interests of any Inspector, Holder or Underwriter;
(xiv)
in the case of a Shelf Registration, use its commercially reasonable efforts to cause all Registrable Securities to be
listed on any securities exchange or any automated quotation system on which similar securities issued or guaranteed by the Company
are then listed if requested by the Majority Holders, to the extent such Registrable Securities satisfy applicable listing requirements;
(xv)
if reasonably requested by any Participating Holder covered by a Shelf Registration Statement pursuant to Section
2(b) hereof, promptly include in a Prospectus supplement or post-effective amendment such information with respect to such
Participating Holder as such Participating Holder reasonably requests to be included therein and make all required filings of such
Prospectus supplement or such post-effective amendment as soon as the Company has received notification of the matters to be so
included in such filing; and
(xvi)
in the case of a Shelf Registration, enter into such customary agreements and take all such other actions in
connection therewith (including those requested by the Participating Holders of a majority in principal amount of the Registrable
Securities covered by the Shelf Registration Statement) in order to expedite or facilitate the disposition of such Registrable Securities
including, but not limited to, an Underwritten Offering and in such connection, (1) to the extent possible, make such representations
and warranties to the Participating Holders and
12
any Underwriters of such Registrable Securities with respect to the business of the Company and its subsidiaries and the Registration
Statement, Prospectus and documents incorporated by reference or deemed incorporated by reference, if any, in each case, in form,
substance and scope as are customarily made by issuers to underwriters in underwritten offerings and confirm the same if and when
requested, (2) obtain opinions of counsel to the Company (which counsel and opinions, in form, scope and substance, shall be
reasonably satisfactory to the Participating Holders and such Underwriters and their respective counsel) addressed to each
Participating Holder and Underwriter of Registrable Securities, covering the matters customarily covered in opinions requested in
underwritten offerings, (3) obtain “comfort” letters from the independent registered public accountants of the Company (and, if
necessary, any other independent registered public accountant of any subsidiary of the Company or of any business acquired by the
Company for which financial statements and financial data are or are required to be included in the Registration Statement) addressed
to each Participating Holder (to the extent permitted by applicable professional standards) and Underwriter of Registrable Securities,
such letters to be in customary form and covering matters of the type customarily covered in “comfort” letters in connection with
underwritten offerings, including but not limited to financial information contained in any preliminary prospectus or Prospectus and
(4) deliver such documents and certificates as may be reasonably requested by the Participating Holders of a majority in principal
amount of the Registrable Securities being sold or the Underwriters, and which are customarily delivered in underwritten offerings, to
evidence the continued validity of the representations and warranties of the Company made pursuant to clause (1) above and to
evidence compliance with any customary conditions contained in an underwriting agreement; it being agreed that the representations
and warranties, opinions of counsel and comfort letters delivered in connection with the initial offering of the Securities are
customary.
(b)
In the case of a Shelf Registration Statement, the Company may require each Holder of Registrable Securities to
furnish to the Company such information regarding such Holder and the proposed disposition by such Holder of such Registrable
Securities as the Company may from time to time reasonably request in writing; provided that if a Holder fails to provide the
requested information within 20 Business Days after receiving such request, the Company may exclude such Holder's Registrable
Securities from such Shelf Registration Statement.
(c)
Each Participating Holder agrees that, upon receipt of any notice from the Company of the happening of any event
of the kind described in Section 3(a)(v)(3), Section 3(a)(v)(4) or Section 3(a)(v)(5) hereof, such Person will forthwith discontinue
disposition of Registrable Securities pursuant to the Shelf Registration Statement until such Person’s receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 3(a)(ix) hereof and, if so directed by the Company, such Person will
deliver to the
Company all copies in its possession, other than permanent file copies then in such Person’s possession, of the Prospectus covering
such Registrable Securities that is current at the time of receipt of such notice.
(d)
If the Company gives any notice to suspend the disposition of Registrable Securities pursuant to a Registration Statement
pursuant to this Section 3(d), the Company shall extend the period during which such Registration Statement shall be maintained effective
pursuant to this Agreement by the number of days during the period from and including the date
13
of the giving of such notice to and including the date when the Holders of such Registrable Securities shall have received copies of the
supplemented or amended Prospectus necessary to resume such dispositions. The Company may give any such notice only twice
during any 365- day period and any such suspensions shall not exceed 30 days for each suspension and there shall not be more than
two suspensions in effect during any 365-day period.
(e)
The Participating Holders who desire to do so may sell such Registrable Securities in an Underwritten Offering. In
any such Underwritten Offering, the investment bank or investment banks and manager or managers (each an “ Underwriter ”) that
will administer the offering will be selected by the Holders of a majority in principal amount of the Registrable Securities included in
such offering, subject to the approval of the Company, which approval shall not be unreasonably withheld.
4.
Participation of Broker-Dealers in Exchange Offer . (a) The Staff has taken the position that any broker-dealer that
receives Exchange Securities for its own account in the Exchange Offer in exchange for Securities that were acquired by such broker-
dealer as a result of market-making or other trading activities (a “ Participating Broker-Dealer ”) may be deemed to be an
“underwriter” within the meaning of the Securities Act and must deliver a prospectus meeting the requirements of the Securities Act
in connection with any resale of such Exchange Securities.
The Company understands that it is the Staff’s position that if the Prospectus contained in the Exchange Offer Registration
Statement includes a plan of distribution containing a statement to the above effect and the means by which Participating Broker-
Dealers may resell the Exchange Securities, without naming the Participating Broker-Dealers or specifying the amount of Exchange
Securities owned by them, such Prospectus may be delivered by Participating Broker-Dealers (or, to the extent permitted by law,
made available to purchasers) to satisfy their prospectus delivery obligation under the Securities Act in connection with resales of
Exchange Securities for their own accounts, so long as the Prospectus otherwise meets the requirements of the Securities Act.
(b)
In light of the above, and notwithstanding the other provisions of this Agreement, the Company agrees to amend or
supplement the Prospectus contained in the Exchange Offer Registration Statement for a period of up to 180 days after the last
Exchange Date (as such period may be extended pursuant to Section 3(d) hereof), in order to expedite or facilitate the disposition of
any Exchange Securities by Participating Broker-Dealers consistent with the positions of the Staff recited in Section 4(a) above. The
Company further agrees that Participating Broker-Dealers shall be authorized to deliver such Prospectus (or, to the extent permitted by
law, make available) during such period in connection with the resales contemplated by this Section 4.
(c)
The Dealer Managers shall have no liability to the Company, or any Holder with respect to any request that they
may make pursuant to Section 4(b) hereof.
5.
Indemnification and Contributio n. (a) The Company agrees to indemnify and hold harmless each Dealer Manager
and each Holder, their respective affiliates, directors and officers and each Person, if any, who controls any Dealer Manager or any
Holder within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act, from and against
14
any and all losses, claims, damages and liabilities (including, without limitation, legal fees and other expenses reasonably incurred in
connection with any suit, action or proceeding or any claim asserted, as such fees and expenses are incurred), joint or several, that
arise out of, or are based upon, (1) any untrue statement or alleged untrue statement of a material fact contained in any Registration
Statement or any omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to
make the statements therein not misleading, or (2) any untrue statement or alleged untrue statement of a material fact contained in any
Prospectus, any Free Writing Prospectus used in violation of this Agreement or any “issuer information” (“ Issuer Informatio n”) filed
or required to be filed pursuant to Rule 433(d) under the Securities Act, or any omission or alleged omission to state therein a material
fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading,
in each case except insofar as such losses, claims, damages or liabilities arise out of, or are based upon, any untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in conformity with any information relating to any Dealer
Manager or information relating to any Holder furnished to the Company in writing through Merrill Lynch or any selling Holder,
respectively, expressly for use therein. In connection with any Underwritten Offering permitted by Section 3, the Company will also
indemnify the Underwriters, if any, selling brokers, dealers and similar securities industry professionals participating in the
distribution, their respective affiliates and each Person who controls such Persons (within the meaning of the Securities Act and the
Exchange Act) to the same extent as provided above with respect to the indemnification of the Holders, if requested in connection
with any Registration Statement, any Prospectus, any Free Writing Prospectus used in violation of this Agreement or any Issuer
Information.
(b)
Each Holder agrees, severally and not jointly, to indemnify and hold harmless the Company, the Dealer Managers
and the other selling Holders, the directors of the Company, each officer of the Company who signed the Registration Statement and
each Person, if any, who controls the Company, any Dealer Manager and any other selling Holder within the meaning of Section 15 of
the Securities Act or Section 20 of the Exchange Act to the same extent as the indemnity set forth in paragraph (a) above, but only
with respect to any losses, claims, damages or liabilities that arise out of, or are based upon, any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity with any information relating to such Holder furnished
to the Company in writing by such Holder expressly for use in any Registration Statement and any Prospectus.
(c)
If any suit, action, proceeding (including any governmental or regulatory investigation), claim or demand shall be
brought or asserted against any Person in respect of which indemnification may be sought pursuant to either paragraph (a) or (b)
above, such Person (the “ Indemnified Person ”) shall promptly notify the Person against whom such indemnification may be sought
(the “ Indemnifying Pers on”) in writing; provided that the failure to notify the Indemnifying Person shall not relieve it from any
liability that it may have under paragraph (a) or above except to the extent that it has been materially prejudiced (through the forfeiture
of substantive rights or defenses) by such failure; and provided , further, that the failure to notify the Indemnifying Person shall not
relieve it from any liability that it may have to an Indemnified Person otherwise than under paragraph (a) or (b) above. If any such
proceeding shall be brought or asserted against an Indemnified Person and it shall have notified the Indemnifying Person thereof, the
Indemnifying Person shall retain counsel reasonably satisfactory to the Indemnified Person to
15
represent the Indemnified Person and any others entitled to indemnification pursuant to this Section 5 that the Indemnifying Person
may designate in such proceeding and shall pay the fees and expenses of such proceeding and shall pay the reasonable fees and
expenses of such counsel related to such proceeding, as incurred. In any such proceeding, any Indemnified Person shall have the right
to retain its own counsel, but the fees and expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the contrary; (ii) the Indemnifying Person has failed
within a reasonable time to retain counsel reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person shall have
reasonably concluded that there may be legal defenses available to it that are different from or in addition to those available to the
Indemnifying Person; or (iv) the named parties in any such proceeding (including any impleaded parties) include both the
Indemnifying Person and the Indemnified Person and representation of both parties by the same counsel would be inappropriate due to
actual or potential differing interests between them. It is understood and agreed that the Indemnifying Person shall not, in connection
with any proceeding or related proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all such fees and expenses shall be reimbursed as they are
incurred. Any such separate firm (x) for any Dealer Manager, its affiliates, directors and officers and any control Persons of such
Dealer Manager shall be designated in writing by Merrill Lynch, (y) for any other Holder, its directors and officers and any control
Persons of such Holder shall be designated in writing by the Majority Holders (other than any Dealer Manager) and (z) in all other
cases shall be designated in writing by the Company. The Indemnifying Person shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such consent or if there be a final judgment for the plaintiff, the
Indemnifying Person agrees to indemnify each Indemnified Person from and against any loss or liability by reason of such settlement
or judgment. No Indemnifying Person shall, without the written consent of the Indemnified Person, effect any settlement of any
pending or threatened proceeding in respect of which any Indemnified Person is or could have been a party and indemnification could
have been sought hereunder by such Indemnified Person, unless such settlement (A) includes an unconditional release of such
Indemnified Person, in form and substance reasonably satisfactory to such Indemnified Person, from all liability on claims that are the
subject matter of such proceeding and (B) does not include any statement as to or any admission of fault, culpability or a failure to act
by or on behalf of any Indemnified Person.
(d)
If the indemnification provided for in paragraphs (a) and (b) above is unavailable to an Indemnified Person or
insufficient in respect of any losses, claims, damages or liabilities referred to therein, then each Indemnifying Person under such
paragraph, in lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid or payable by such
Indemnified Person as a result of such losses, claims, damages or liabilities (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company from the offering of the Securities and the Exchange Securities, on the one hand, and by the
Holders from receiving Securities or Exchange Securities registered under the Securities Act, on the other hand, or (ii) if the allocation
provided by clause (i) is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) but also the relative fault of the Company on the one hand and the Holders on the other in connection with the
statements or omissions that resulted in such losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the Company on the one hand and
16
the Holders on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact relates to information supplied by the Company or by the
Holders and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such statement or
omission.
(e)
The Company and the Holders agree that it would not be just and equitable if contribution pursuant to this Section 5
were determined by pro rata allocation (even if the Holders were treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations referred to in paragraph (d) above. The amount paid or payable by
an Indemnified Person as a result of the losses, claims, damages and liabilities referred to in paragraph (d) above shall be deemed to
include, subject to the limitations set forth above, any legal or other expenses reasonably incurred by such Indemnified Person in
connection with any such action or claim. Notwithstanding the provisions of this Section 5, in no event shall a Holder be required to
contribute any amount in excess of the amount by which the total price at which the Securities or Exchange Securities sold by such
Holder exceeds the amount of any damages that such Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission. No Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.
The Holders’ obligations to contribute pursuant to this Section 5 are several and not joint.
(f)
(g)
otherwise be available to any Indemnified Person at law or in equity.
The remedies provided for in this Section 5 are not exclusive and shall not limit any rights or remedies that may
The indemnity and contribution provisions contained in this Section 5 shall remain operative and in full force and
effect regardless of (i) any termination of this Agreement,
(ii) any investigation made by or on behalf of the Dealer Managers or any Holder or any Person controlling any Dealer Manager or
any Holder, or by or on behalf of the Company or the officers or directors of or any Person controlling the Company, (iii) acceptance
of any of the Exchange Securities and (iv) any sale of Registrable Securities pursuant to a Shelf Registration Statement.
6.
(a)
General .
No Inconsistent Agreements. The Company represents, warrants and agrees that
(i) the rights granted to the Holders hereunder do not in any way conflict with and are not inconsistent with the rights granted to the
holders of any other outstanding securities issued or guaranteed by the Company under any other agreement and (ii) the Company has
not entered into, or on or after the date of this Agreement will enter into, any agreement that is inconsistent with the rights granted to
the Holders of Registrable Securities in this Agreement or otherwise conflicts with the provisions hereof.
(b)
Amendments and Waivers. The provisions of this Agreement, including the provisions of this sentence, may not be
amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given unless the
Company has
17
obtained the written consent of Holders of at least a majority in aggregate principal amount of the outstanding Registrable Securities
affected by such amendment, modification, supplement, waiver or consent; provided that no amendment, modification, supplement,
waiver or consent to any departure from the provisions of Section 5 hereof shall be effective as against any Holder of Registrable
Securities unless consented to in writing by such Holder. Any amendments, modifications, supplements, waivers or consents pursuant
to this Section 6(b) shall be by a writing executed by each of the parties hereto.
(c)
Notices. All notices and other communications provided for or permitted hereunder shall be made in writing by
hand-delivery, first-class mail, telecopier/facsimile, or any courier guaranteeing overnight delivery (i) if to a Holder, at the most
current address given by such Holder to the Company by means of a notice given in accordance with the provisions of this Section
6(c), which address initially is, with respect to the Dealer Managers, the address set forth in the Dealer Manager Agreement; (ii) if to
the Company, initially at the Company’s address set forth in the Dealer Manager Agreement and thereafter at such other address,
notice of which is given in accordance with the provisions of this Section 6(c); and (iii) to such other persons at their respective
addresses as provided in the Dealer Manager Agreement and thereafter at such other address, notice of which is given in accordance
with the provisions of this Section 6(c).
All such notices and communications shall be deemed to have been duly given: at the time delivered by hand, if personally delivered;
five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt is acknowledged, if telecopied/faxed;
and on the next Business Day if timely delivered to an air courier guaranteeing overnight delivery. Copies of all such notices,
demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee, at the address
specified in the Indenture.
(d)
Successors and Assigns. This Agreement shall inure to the benefit of and be binding upon the successors, assigns
and transferees of each of the parties, including, without limitation and without the need for an express assignment, subsequent
Holders; provided that nothing herein shall be deemed to permit any assignment, transfer or other disposition of Registrable Securities
in violation of the terms of the Dealer Manager Agreement or the Indenture. If any transferee of any Holder shall acquire Registrable
Securities in any manner, whether by operation of law or otherwise, such Registrable Securities shall be held subject to all the terms of
this Agreement, and by taking and holding such Registrable Securities such Person shall be conclusively deemed to have agreed to be
bound by and to perform all of the terms and provisions of this Agreement and such Person shall be entitled to receive the benefits
hereof. The Dealer Managers (solely in their capacity as Dealer Managers) shall have no liability or obligation to the Company with
respect to any failure by a Holder to comply with, or any breach by any Holder of, any of the obligations of such Holder under this
Agreement.
(e)
Third Party Beneficiaries. Each Holder shall be a third party beneficiary to the agreements made hereunder between the
Company, on the one hand, and the Dealer Managers, on the other hand, and shall have the right to enforce such agreements directly to the
extent it deems such enforcement necessary or advisable to protect its rights or the rights of other Holders hereunder.
(f)
Counterparts. This Agreement may be executed in any number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be
18
deemed to be an original and all of which taken together shall constitute one and the same agreement.
and shall not limit or otherwise affect the meaning hereof.
Headings. The headings in this Agreement are for convenience of reference only, are not a part of this Agreement
shall be governed by and construed in accordance with the laws of the State of New York.
Governing Law. This Agreement, and any claims, controversy or dispute arising under or related to this Agreement
(g)
(h)
(i)
Entire Agreement; Severability. This Agreement contains the entire agreement between the parties relating to the
subject matter hereof and supersedes all oral statements and prior writings with respect thereto. If any term, provision, covenant or
restriction contained in this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable or against
public policy, the remainder of the terms, provisions, covenants and restrictions contained herein shall remain in full force and effect
and shall in no way be affected, impaired or invalidated. The Company and the Dealer Managers shall endeavor in good faith
negotiations to replace the invalid, void or unenforceable provisions with valid provisions the economic effect of which comes as
close as possible to that of the invalid, void or unenforceable provisions.
19
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.
MATCH GROUP, INC.
By:/s/ JOANNE HAWKINS
Name: Joanne Hawkins
Title: Vice President and Assistant Secretary
Confirmed and accepted as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By:/s/ JULIE EFREMOFF
Name: Julie Efremoff
Title: Director
J.P. MORGAN SECURITIES LLC
By:/s/ RAJ KAPACHA
Name: Raj Kapacha
Title: Managing Director
GOLDMAN, SACHS & CO.
By:/s/ MICHAEL HICKEY
Name: Michael Hickey
Title: Managing Director
BNP PARIBAS SECURITIES CORP.
By:/s/ JIM TURNER
Name: Jim Turner
Title: Managing Director
20
BMO CAPITAL MARKETS CORP.
By:/s/ Bryan J. Rolfe
Name: Bryan J. Rolfe
Title: Managing Director
DEUTSCH BANK SECURITIES INC.
By:/s/ NICHOLAS HAYES
Name: Nicholas Hayes
Title: Managing Director
By:/s/ AUTHORIZED SIGNATORY
Name: Authorized Signatory
Title: Authorized Signatory
PNC CAPITAL MARKETS LLC
By:/s/ ROBERT W. THOMAS
Name: Robert W. Thomas
Title: Managing Director
FIFTH THIRD SECURITIES, INC.
By:/s/ MARIA T. YAMAT
Name: Maria T. Yamat
Title: Managing Director
SG AMERICAS SECURITIES, LLC
By:/s/ AUTHORIZED SIGNATORY
Name: Authorized Signatory
Title: Authorized Signatory
21
Exhibit 10.9
Summary of Non-Employee Director Compensation Arrangements
Pursuant to the compensation program for non-employee directors approved by the board of directors of Match Group, Inc. (“Match Group”) and effective
immediately prior to the commencement of trading on November 19, 2015 (the “Director Compensation Program”), each non-employee director receives an annual
retainer fee of $50,000 and the Chairpersons of the Audit and Compensation Committees each receive an additional annual retainer of $20,000. Members of the Audit
and Compensation Committees (including the Chairpersons) receive an additional annual retainer of $10,000 and $5,000, respectively.
In addition, non-employee directors receive a grant of restricted stock units with a dollar value of $250,000 upon their initial election to the board of directors and
annually thereafter upon their re-election to the board of directors on the date of Match Group's annual meeting of stockholders. The terms of these restricted stock
units provide for: (i) vesting in three equal annual installments commencing on the first anniversary of the grant date, (ii) cancellation and forfeiture of unvested units
in their entirety upon termination of board service and (iii) full acceleration of vesting upon a change in control of Match Group. Match Group also reimburses non-
employee directors for all reasonable expenses incurred by such directors as a result of attendance at Match Group board and committee meetings.
For purposes of the Director Compensation Program, non-employee directors are those directors who are not employed by (or otherwise providing services to)
Match Group or IAC/InterActiveCorp.
EXECUTION VERSION
Exhibit 10.10
INCREMENTAL ASSUMPTION AGREEMENT AND AMENDMENT NO. 1 , dated as of November 16, 2015
(this “ Agreement ”). Reference is made to the Credit Agreement dated as of October 7, 2015, among MATCH GROUP, INC.
(formerly known as THE MATCH GROUP, INC.), a Delaware corporation (the “ Borrower ”), the several banks and other financial
institutions or entities from time to time parties to the Credit Agreement, as lenders (the “ Lenders ”), JPMORGAN CHASE BANK,
N.A., as Administrative Agent (the “ Administrative Agent ”) and Collateral Agent and the various other parties thereto (as amended,
restated, modified and supplemented from time to time prior to the date hereof, the “ Credit Agreement ”, and the Credit Agreement, as
amended and restated by this Agreement, the “ Amended Credit Agreement ”) . Capitalized terms used and not otherwise defined
herein shall have the meanings assigned to such terms in the Amended Credit Agreement.
WHEREAS, the Borrower has notified the Administrative Agent that it is requesting Incremental Term Loan Commitments pursuant to
Section 2.02 of the Amended Credit Agreement in the form of Term B-1 Loans;
WHEREAS, the Term B-1 Lender has agreed to provide such Term B-1 Loans in the amount set forth on Schedule I hereto;
WHEREAS, pursuant to Section 2.02(b) of the Credit Agreement, the Borrower and each Incremental Term Lender shall execute and
deliver to the Administrative Agent an Incremental Assumption Agreement to evidence the Incremental Term Loan Commitment of
such Incremental Term Lender;
WHEREAS, pursuant to Section 9.02(b) of the Credit Agreement, the Borrower, the Administrative Agent and the Required Lenders
may amend, amend and restate or modify the Credit Agreement pursuant to an agreement in writing;
WHEREAS, in order to effect the foregoing, the Borrower and the other parties hereto desire to amend and restate the Credit
Agreement, subject to the terms and conditions set forth herein;
NOW, THEREFORE, the parties hereto agree as follows:
Section 1.
Amendment . The Credit Agreement is, effective as of the Term B-1 Effective Date (as
defined below), hereby amended and restated to delete the stricken text (indicated textually in the same manner as the following
example: stricken text ) and to add the double-underlined text (indicated textually in the same manner as the following example:
double-underlined text ) as set forth in the pages of the Credit Agreement attached as Exhibit A hereto.
Section 2. Representations and Warranties, No Default . The Borrower hereby represents and warrants that as of
the Term B-1 Effective Date (as defined below), (i) after giving effect to the amendment and restatement set forth in this Agreement
and the
1
EXECUTION VERSION
incurrence of the Term B-1 Loans, no Default or Event of Default shall have occurred and be continuing and (ii) the representations
and warranties of each Loan Party set forth in the Credit Agreement shall be true and correct in all material respects (except to the
extent that any such representation and warranty is qualified by materiality or Material Adverse Effect, in which case such
representation and warranty shall be true and correct in all respects), except to the extent that any such representation and warranty
relates to an earlier date (in which case such representation and warranty shall have been true and correct in all material respects
(except to the extent that any such representation and warranty is qualified by materiality or Material Adverse Effect, in which case
such representation and warranty shall be true and correct in all respects) as of such earlier date).
Section 3. Effectiveness . Section 1 of this Agreement shall become effective on the date (such date, if any, the “
Term B-1 Effective Date ”) that the following conditions have been satisfied:
(i) Consents . The Administrative Agent shall have received (including by telecopy or email transmission)
executed signature pages hereto from the Borrower, each Subsidiary Guarantor, the Administrative Agent, each Term B-1
Lender and the Lenders constituting Required Lenders immediately prior to the Term B-1 Effective Date;
(ii) Fees . The Administrative Agent shall have received (or shall receive out of the proceeds of the Term B-1
Loans) all fees required to be paid, and all expenses required to be paid or reimbursed under Section 9.04(a) of the Credit
Agreement for which invoices have been presented a reasonable period of time prior to the Term B-1 Effective Date, in each
case on or before the Term B-1 Effective Date;
(iii) Legal Opinions . The Administrative Agent shall have received a favorable written opinion (addressed to the
Administrative Agent and the Lenders as of the Term B-1 Effective Date and dated the Term B-1 Effective Date) of (i)
Wachtell, Lipton, Rosen & Katz, counsel for the Borrower and certain of the Loan Parties and (ii) local counsel in each
jurisdiction in which a Loan Party is organized and the laws of which are not covered by the opinion referred to in (i) above, in
each case in form and substance reasonably satisfactory to the Administrative Agent and its counsel;
(iv) Officer’s Certificate . The Administrative Agent shall have received a certificate, dated the Term B-1
Effective Date and signed by the Chief Executive Officer, a Vice President, a Financial Officer of the Borrower or any other
executive officer of the Borrower who has specific knowledge of the Borrower’s financial matters and is satisfactory to the
Administrative Agent, confirming that (a) after giving effect to the amendments set forth in this Agreement, the incurrence of
the Term B-1 Loans and the use of proceeds therefrom, no Default or Event of Default has occurred and is continuing under the
Credit Agreement, (b) after giving effect to the amendment and restatement set forth in this Agreement and the incurrence of
the Term B-1 Loans, the representations and warranties of each Loan Party set forth in the Credit Agreement are true and
correct in all material respects (except to the extent that any such representation and warranty is qualified by materiality or
Material Adverse Effect, in which case such representation
2
EXECUTION VERSION
and warranty shall be true and correct in all respects), except to the extent that any such representation and warranty relates to
an earlier date (in which case such representation and warranty shall have been true and correct in all material respects (except
to the extent that any such representation and warranty is qualified by materiality or Material Adverse Effect, in which case
such representation and warranty shall be true and correct in all respects) as of such earlier date), (c) the Borrower is in pro
forma compliance with Section 6.10 of the Credit Agreement as of the last day of the most recently ended Test Period prior to
the Term B-1 Effective Date after giving effect to the incurrence of the Term B-1 Loans and (d) the Separation Date has
occurred;
(v) Closing Certificates . The Administrative Agent shall have received a certificate of each Loan Party
substantially in the form of Exhibit E to the Credit Agreement, dated the Term B-1 Effective Date;
(vi) Solvency Certificate . The Administrative Agent shall have received a solvency certificate in the form of
Exhibit I to the Credit Agreement, dated the Term B-1 Effective Date and signed by the chief financial officer of the Borrower;
(vii) No Change. Since December 31, 2014, there has been no event that has had or would reasonably be expected
to have, individually or in the aggregate, a Material Adverse Effect;
(viii) KYC . Each Loan Party shall have provided the documentation and other information requested by the Term B-
1 Lenders that is required by regulatory authorities under applicable “know your customer” and anti-money-laundering rules
and regulations, including without limitation, the Act, in each case as requested at least three Business Days prior to the Term
B-1 Effective Date; and
(ix) Separation Date . The Separation Date shall have occurred.
Section 4. Reaffirmation . Each Loan Party hereby acknowledges its receipt of a copy of this Agreement and the
Amended Credit Agreement and its review of the terms and conditions hereof and thereof and consents to the terms and conditions
hereof and of the Amended Credit Agreement and the transactions contemplated thereby. Each Subsidiary Guarantor hereby (a) affirms
and confirms its guarantees and other commitments under the Subsidiary Guarantee and (b) agrees that the Subsidiary Guarantee is in
full force and effect and shall accrue to the benefit of the Secured Parties to guarantee the Obligations, including the Term B-1 Loans.
Each Loan Party hereby (a) affirms and confirms its pledges, grants and other commitments under the Pledge Agreement and
(b) agrees that the Pledge Agreement is in full force and effect and shall accrue to the benefit of the Secured Parties to secure the
Obligations, including the Term B-1 Loans.
Section 5. Counterparts . This Agreement may be executed in any number of counterparts and by different parties
hereto on separate counterparts, each of which when so executed and delivered shall be deemed to be an original, but all of which when
taken together shall constitute a single instrument. Delivery of an executed counterpart of a signature page of
3
EXECUTION VERSION
this Agreement by facsimile or any other electronic transmission shall be effective as delivery of a manually executed counterpart
hereof.
Section 6. Applicable Law; Waiver of Jury Trial; Jurisdiction; Consent to Service of Process . The provisions
set forth in Sections 9.10 and 9.11 of the Credit Agreement are hereby incorporated mutatis mutandis with all references to the
“Agreement” therein being deemed references to this Agreement.
Section 7. Headings . The headings of this Agreement are for purposes of reference only and shall not limit or
otherwise affect the meaning hereof.
Section 8. Effect of Amendment . Except as expressly set forth herein, (i) this Agreement shall not by implication or
otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the Lenders, the Administrative Agent or
any other Agent, in each case under the Credit Agreement or any other Loan Document, and (ii) shall not alter, modify, amend or in
any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any other
provision of either such agreement or any other Loan Document. This Agreement shall constitute a Loan Document for purposes of the
Credit Agreement and from and after the Term B-1 Effective Date, all references to the Credit Agreement in any Loan Document and
all references in the Credit Agreement to “this Agreement”, “hereunder”, “hereof” or words of like import referring to the Credit
Agreement, shall, unless expressly provided otherwise, refer to the Amended Credit Agreement. The Borrower hereby consents to this
Agreement and confirms that all obligations of the Borrower under the Loan Documents to which it is a party shall continue to apply to
the Amended Credit Agreement.
[Signature pages follow]
4
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as
of the day and year first above written.
MATCH GROUP, INC.
By:/s/ NICK STOUMPAS
Name: Nick Stoumpas
Title: Vice President and Treasurer
HIGHER EDGE MARKETING SERVICES, INC.
HUMOR RAINBOW, INC.
MATCH.COM INTERNATIONAL HOLDINGS, INC.
MATCH.COM, L.L.C.
MOJO ACQUISITION CORP.
PEOPLE MEDIA, INC.
PEOPLE MEDIA, LLC
TINDER, INC.
TPR EDUCATION HOLDINGS, INC.
TPR EDUCATION IP HOLDINGS, LLC
TPR EDUCATION OFFSHORE HOLDINGS, LLC
TPR EDUCATION WORLDWIDE, LLC
TPR EDUCATION, LLC
TUTOR.COM, INC.
By:/s/ NICK STOUMPAS
Name: Nick Stoumpas
Title: Authorized Person
[Signature Page to Incremental Assumption Agreement No. 1]
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent
By:/s/ DONATUS O. ANUSIONWU
Name: Donatus O. Anusionwu
Title: Vice President
JPMORGAN CHASE BANK, N.A.,
as Term B-1 Lender
By:/s/ DONATUS O. ANUSIONWU
Name: Donatus O. Anusionwu
Title: Vice President
BANK OF AMERICA, N.A.,
as Lender
By:/s/ MARIE F. HARRISON
Name: Marie F. Harrison
Title: Vice President
BARCLAYS BANK PLC,
as Lender
By:/s/ AMIR BARASH
Name: Amir Barash
Director
BMO HARRIS BANK, N.A.,
as Lender
By:/s/ JOAN MURPHY
Name: Joan Murphy
Title: Director
[Signature Page to Incremental Assumption Agreement No. 1]
Title:
BNP PARIBAS,
as Lender
By:/s/ NICOLE RODRIGUEZ
Name: Nicole Rodriguez
Title: Director
By:/s/ ADE ADEDEJI
Name: Ade Adedeji
Title: Vice President
DEUTSCH BANK AG NEW YORK BRANCH,
as Lender
By:/s/ ANCA TRIFAN
Name: Anca Trifan
Title: Managing Director
By:/s/ MICHAEL WINTERS
Name: Michael Winters
Title: Vice President
FIFTH THIRD BANK,
as Lender
By:/s/ CHRISTOPHER F. STAPLES
Name: Christopher F. Staples
Title: Vice President
GOLDMAN SACHS BANK USA,
as Lender
By:/s/ JERRY LI
Name: Jerry Li
[Signature Page to Incremental Assumption Agreement No. 1]
Title: Authorized Signatory
PNC BANK, NATIONAL ASSOCIATION,
as Lender
By:/s/ THOMAS BROWER
Name: Thomas Brower
Title: Senior Vice President
SOCIETE GENERALE,
as Lender
By:/s/ NIGEL ELVEY
Name: Nigel Elvey
Title: Director
[Signature Page to Incremental Assumption Agreement No. 1]
SCHEDULE 1
COMMITMENTS IN RESPECT OF TERM B-1 LOANS
Term B-1 Lender
Commitment
JPMORGAN CHASE BANK, N.A.
Total:
$800,000,000
$800,000,000
EXECUTION VERSION Exhibit A
$500,000,000
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of October 7, 2015,
as amended and restated as of November 16, 2015
among
THE MATCH GROUP, INC.,
as Borrower,
THE LENDERS PARTY HERETO,
and
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent
_________________
J.P. MORGAN SECURITIES LLC, MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED, DEUTSCHE BANK SECURITIES INC., BNP PARIBAS SECURITIES CORP. and GOLDMAN SACHS LENDING PARTNERS LLC,
as Joint Lead Arrangers and Joint Bookrunners,
BANK OF AMERICA, N.A.,
as Syndication Agent,
and DEUTSCHE BANK AG NEW YORK BRANCH, BNP PARIBAS and GOLDMAN SACHS BANK USA BMO CAPITAL MARKETS CORP., FIFTH THIRD
BANK , SG AMERICAS SECURITIES, LLC and PNC CAPITAL MARKETS LLC
as Co-Documentation Agents
TABLE OF CONTENTS
ARTICLE I
Definitions
ARTICLE II
The Credits
Defined Terms
Classification of Loans and Borrowings
Terms Generally
Accounting Terms; GAAP
Change of Currency
Currency Equivalents Generally
Revolving Commitments
Incremental Revolving Commitments and Incremental Term Loans
Procedure for Revolving Loan Borrowing
Funding of Borrowings
Interest Elections
Termination and Reduction of Commitments
Repayment of Loans; Evidence of Debt
Prepayments
Fees
Interest
Alternate Rate of Interest
Increased Costs
Break Funding Payments
Taxes
Pro Rata Treatment and Payments
Mitigation Obligations; Replacement of Lenders
Letters of Credit
Defaulting Lenders
Extensions of Commitments
Refinancing Amendments
Loan Repurchases
ARTICLE III
Representations and Warranties
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
1.01
1.02
1.03
1.04
1.05
1.06
2.01
2.02
2.03
2.04
2.05
2.06
2.07
2.08
2.09
2.10
2.11
2.12
2.13
2.14
2.15
2.16
2.17
2.18
2.19
2.20
2.21
SECTION
SECTION
SECTION
3.01
3.02
3.03
Organization; Powers
Authorization; Enforceability
Governmental Approvals; No Conflicts
-i-
Page
1
37 43
37 43
37 43
37 43
37 44
38 44
39 45
42 48
42 49
43 49
44 50
44 50
44 51
45 53
45 54
46 54
47 55
48 56
48 56
50 58
52 60
52 61
57 65
58 66
60 68
63 72
64 73
64 73
65 74
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
3.04
3.05
3.06
3.07
3.08
3.09
3.10
3.11
3.12
3.13
3.14
3.15
3.16
3.17
Financial Position
Properties
Litigation and Environmental Matters
Compliance with Laws and Agreements
Investment Company Status
Taxes
ERISA
Disclosure
Pledge Agreement
No Change
Guarantors
Solvency
No Default
Anti-Corruption Laws and Sanctions
SECTION
SECTION
4.01
4.02
Closing Date
Each Credit Event
ARTICLE IV
Conditions
ARTICLE V
Affirmative Covenants
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
5.01
5.02
5.03
5.04
5.05
5.06
5.07
5.08
5.09
5.10
5.11
5.12
6.01
6.02
6.03
6.04
6.05
6.06
Financial Statements; Other Information
Notices of Material Events
Existence; Conduct of Business
Payment of Obligations
Maintenance of Properties; Insurance
Books and Records; Inspection Rights
Compliance with Laws
Use of Proceeds
Guarantors and Collateral
Post-Closing Delivery of Certificated Equity Interests
Further Assurances
Ratings
ARTICLE VI
Negative Covenants
Indebtedness
Liens
Fundamental Changes
Disposition of Property
Restricted Payments
Transactions with Affiliates
Page
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66 74
66 75
66 75
66 75
66 75
66 75
66 75
66 75
66 75
67 76
67 76
67 76
68 77
69 78
71 80
71 80
71 80
71 80
71 81
72 81
72 81
72 81
73 81
73 82
82
73 82
76 85
78 87
79 87
79 88
81 90
-ii-
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
6.07
6.08
6.09
6.10
6.11
6.12
Changes in Fiscal Periods
Sales and Leasebacks
Clauses Restricting Subsidiary Distributions
Consolidated Net Leverage Ratio; Interest Coverage Ratio
Investments
Activities of The Match Group, Inc.
SECTION
7.01
Events of Default
ARTICLE VII
Events of Default
ARTICLE VIII
The Administrative Agent
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
SECTION
8.01
8.02
8.03
8.04
8.05
8.06
8.07
8.08
8.09
9.01
9.02
9.03
9.04
9.05
9.06
9.07
9.08
9.09
9.10
9.11
9.12
9.13
9.14
9.15
9.16
9.17
9.18
Appointment and Authorization
Administrative Agent and Affiliates
Action by Administrative Agent
Consultation with Experts
Delegation of Duties
Successor Administrative Agent
Credit Decision
Lead Arrangers; Syndication Agent; Co-Documentation Agents
Tax Indemnification by the Lenders
ARTICLE IX
Miscellaneous
Notices
Waivers; Amendments
Waivers; Amendments to Other Loan Documents
Expenses; Indemnity; Damage Waiver
Successors and Assigns
Survival
Counterparts; Integration; Effectiveness
Severability
Right of Setoff
Governing Law; Jurisdiction; Consent to Service of Process
WAIVER OF JURY TRIAL
Headings
Confidentiality
Judgment Currency
USA PATRIOT Act
Collateral and Guarantee Matters
No Advisory or Fiduciary Relationship
Platform; Borrower Materials
Page
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82 91
84 93
84 93
85 94
86 95
87 97
88 97
88 97
88 97
88 98
88 98
89 98
89 98
89 98
89 99
90 100
92 101
92 102
93 103
96 106
97 106
97 106
97 106
97 107
98 107
98 107
98 108
99 108
99 109
99 109
100 109
110
-iii-
SCHEDULES :
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
Schedule
EXHIBITS :
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
Exhibit
1.01A
1.01B
3.01
3.06
3.12
3.14
5.10
6.01
6.02
6.09
A
B
C
D
E
F
G-1
G-2
G-3
G-4
H
I
J
K
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
--
Commitments
Unrestricted Subsidiaries on Closing Date
Certain Material Subsidiaries
Disclosed Matters
Filings
Guarantors
Post-Closing Delivery of Certificated Equity Interests
Existing Indebtedness
Existing Liens
Existing Restrictions
Form of Assignment and Assumption
Form of Affiliated Lender Assignment and Assumption
Form of Guarantee Agreement
Form of Pledge Agreement
Form of Secretary Certificate
[Reserved]
Form U.S. Tax Certificate (For Non-U.S. Lenders That Are Not Partnerships
For U.S. Federal Income Tax Purposes)
Form U.S. Tax Certificate (For Non-U.S. Lenders That Are Partnerships For
U.S. Federal Income Tax Purposes)
Form U.S. Tax Certificate (For Non-U.S. Participants That Are Not
Partnerships For U.S. Federal Income Tax Purposes)
Form U.S. Tax Certificate (For Non-U.S. Participants That Are Partnerships
For U.S. Federal Income Tax Purposes)
Form of Perfection Certificate
Form of Solvency Certificate
Pari Passu Intercreditor Agreement [Reserved]
Auction Procedures
- iv -
AMENDED AND RESTATED CREDIT AGREEMENT, dated as of October 7, 2015 (as and as amended and restated as of November 16, 2015 (as further
amended, restated, extended, supplemented or otherwise modified from time to time, this “ Agreement ”), among THE MATCH GROUP, INC., a Delaware
corporation (the “ Borrower ”), the LENDERS party hereto from time to time, JPMORGAN CHASE BANK, N.A., as administrative agent for the Lenders and as
collateral agent for the Secured Parties (as defined herein) (in such capacities, the “ Administrative Agent ”) and as an Issuing Bank.
The parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01 Defined Terms . As used in this Agreement, the following terms have the meanings specified below:
“ ABR ” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a
rate determined by reference to the Alternate Base Rate.
“ Act ” has the meaning assigned to such term in Section 9.15.
“ Adjustment Date ” has the meaning assigned to such term in the definition of “Pricing Grid.”
“ Administrative Agent ” means JPMorgan Chase Bank, N.A. (including its branches and affiliates), in its capacity as administrative agent for the Lenders
hereunder and, as applicable (including, for the avoidance of doubt, each reference to the Administrative Agent in Article VIII), as Collateral Agent, together with any
successors in such capacities.
“ Administrative Questionnaire ” means an Administrative Questionnaire in a form supplied by the Administrative Agent.
“ Affiliate ” means, with respect to a specified 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.
“ Affiliated Lender ” means, at any time, any Lender that is an Affiliate of the Borrower (other than any of its subsidiaries) at such time.
“ Affiliated Persons ” means, with respect to any specified Person, (a) such specified Person’s parents, spouse, siblings, descendants, step children, step
grandchildren, nieces and nephews and their respective spouses, (b) the estate, legatees and devisees of such specified Person and each of the Persons referred to in
clause (a), and (c) any company, partnership, trust or other entity or investment vehicle Controlled by any of the Persons referred to in clause (a) or (b) or the holdings
of which are for the primary benefit of any of such Persons.
“ Agent Party ” means the Administrative Agent, the Issuing Bank or any other Lender.
“ Aggregate Exposure ” means, with respect to any Lender at any time, the sum of (a) the aggregate then outstanding principal amount of such Lender’s
Term Loans and (b) the amount of such Lender’s Revolving Commitment then in effect or, if such Revolving Commitment has been terminated, such Lender’s
Outstanding Revolving Credit.
“ Agreement ” has the meaning assigned to such term in the preamble to this Credit Agreement.
“ Agreement Currency ” has the meaning assigned to such term in Section 9.14.
“All-in Yield” means, as to any Loans (or other Indebtedness, if applicable), the yield thereon to Lenders (or other lenders, as applicable) providing such
Loans (or other Indebtedness, if applicable) in the primary syndication thereof, as reasonably determined by the Administrative Agent in consultation with the
Borrower, whether in the form of interest rate, margin, original issue discount, up-front fees, rate floors or otherwise; provided, that original issue discount and up-
front fees shall be equated to interest rate based on an assumed four year average life; and provided, further, that “All-in Yield” shall not include arrangement,
commitment, underwriting, structuring or similar fees and customary consent fees for an amendment paid generally to consenting lenders.
“ Alternate Base Rate ” means, for any day, a rate per annum equal to the highest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective
Rate in effect on such day plus ½ of 1% and (c) the Eurocurrency Rate that would be calculated as of such day (or, if such day is not a Business Day, as of the next
preceding Business Day) in respect of a proposed Eurocurrency Borrowing in Dollars with a one-month Interest Period plus 1.00%. Any change in the Alternate Base
Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or such Eurocurrency Rate shall be effective from and including the effective date of such
change in the Prime Rate, the Federal Funds Effective Rate or such Eurocurrency Rate, respectively.
“ Alternative Currency ” means Sterling, Yen, Euro, Australian Dollar or Canadian Dollar.
“ Alternative Currency Revolving Sublimit ” means, with respect to all Alternative Currencies, the Dollar Amount of $100,000,000.
“ Anti-Corruption Laws ” means the United States Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder and the
Bribery Act 2010 of the United Kingdom, as amended.
“ Applicable Rate ” means (a) for each Type of Revolving Loan other than Incremental Term Loans , (i) prior to the first Adjustment Date occurring after the
Closing Date, 2.00% for Eurocurrency Loans and 1.00% for ABR Loans and (ii) on and after the first Adjustment Date occurring after the Closing Date, a percentage
determined in accordance with the Pricing Grid, and (b (b) for each Term B-1 Loan, 4.50% for Eurocurrency Loans and 3.50% for ABR Loans and (c ) for each Type
of Incremental Term Loan, such per annum rates as shall be agreed to by the Borrower and the applicable Incremental Term Lenders as shown in the applicable
Incremental Assumption Agreement.
“ Applicable Time ” means, with respect to any Borrowings and payments in any Alternative Currency the local time in the place of settlement for such
Alternative Currency, as may be reasonably determined by the Administrative Agent to be necessary for timely settlement on the relevant date in accordance with
normal banking procedures in the place of payment and notified to the relevant parties hereto.
“ Approved Fund ” has the meaning assigned to such term in Section 9.05(b).
“ Asset Acquisition ” means:
(1) an Investment by the Borrower or any Restricted Subsidiary in any other Person if, as a result of such Investment, such Person shall become a
Restricted Subsidiary, or shall be merged with or into the Borrower or any Restricted Subsidiary, or
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(2) the acquisition by the Borrower or any Restricted Subsidiary of all or substantially all of the assets of any other Person or any division or line
of business of any other Person.
“ Asset Sale ” means any sale, issuance, conveyance, transfer, lease, assignment or other disposition by the Borrower or any Restricted Subsidiary to any
Person other than the Borrower or any Restricted Subsidiary (including by means of a sale and leaseback transaction or a merger or consolidation) (collectively, for
purposes of this definition, a “ transfer ”), in one transaction or a series of related transactions, of any assets of the Borrower or any of its Restricted Subsidiaries other
than in the ordinary course of business. For purposes of this definition, the term “Asset Sale” shall not include:
(1) transfers of cash or Cash Equivalents;
(2) transfers of assets (including Equity Interests) that are governed by, and made in accordance with, Section 6.03;
(3) Restricted Payments permitted under the covenant described under Section 6.05 and Investments not prohibited by Section 6.11;
(4) the creation of any Lien permitted under this Agreement;
(5) transfers of assets that are (i) damaged, worn out, uneconomic, obsolete or otherwise deemed to be no longer necessary or useful in the current
or anticipated business of the Borrower or its Restricted Subsidiaries or (ii) replaced by assets of similar suitability and value;
(6) sales or grants of licenses or sublicenses to use the patents, trade secrets, know-how and other intellectual property, and licenses, leases or
subleases of other assets, of the Borrower or any Restricted Subsidiary to the extent not materially interfering with the business of the Borrower and the
Restricted Subsidiaries;
(7) any transfer or series of related transfers that, but for this clause, would be Asset Sales, if the aggregate Fair Market Value of the assets
transferred in such transaction or any such series of related transactions does not exceed $150,000,000 (x) prior to the Term B-1 Loan Repayment Date,
$50,000,000 and (y) on or after the Term B-1 Loan Repayment Date, $150,000,000, in each case for such transaction or any such series of related
transactions; and
(8) transfers in connection with the Match Transactions ; and
(9) at any time prior to the Term B-1 Loan Repayment Date, transfers of assets of the Princeton Review Group and the Tutor.com Group .
“ Asset Swap ” means any exchange of assets of the Borrower or any Restricted Subsidiary (including Equity Interests of a Restricted Subsidiary) for assets
of another Person (including Equity Interests of a Person whose primary business is a Related Business) that are intended to be used by the Borrower or any Restricted
Subsidiary in a Related Business, including, to the extent necessary to equalize the value of the assets being exchanged, cash of any party to such asset swap.
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“ Assignment and Assumption ” means an assignment and assumption entered into by a Lender and an assignee (with the consent of any party whose consent
is required by Section 9.05), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.
“ Auction Manager ” has the meaning assigned to such term in Section 2.21(a).
“ Auction Procedures ” means auction procedures with respect to Purchase Offers set forth in Exhibit K hereto.
“ Australian Dollar ” means the lawful currency of Australia.
“ Australian Dollar Bank Bill Reference Rate ” means for any Loans in Australian Dollars, the Australian Dollar Screen Rate or, if applicable pursuant to the
terms of Section 2.11(a), the applicable Reference Bank Rate.
“ Australian Dollar Screen Rate ” means, with respect to any Interest Period, the average bid reference rate as administered by the Australian Financial
Markets Association (or any other Person that takes over the administration of that rate) for Australian Dollar bills of exchange with a tenor equal in length to such
Interest Period, as displayed on page BBSY of the Reuters screen or, in the event such rate does not appear on such Reuters page, on any successor or substitute page
on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate as selected by the Administrative Agent
from time to time in its reasonable discretion.
“ Available Revolving Commitment ” means, as to any Revolving Lender at any time, an amount equal to the excess, if any, of (a) such Lender’s Revolving
Commitment then in effect at such time over (b) such Lender’s Outstanding Revolving Credit.
“ Bankruptcy Event ” means, with respect to any Lender, such Lender or any other Person as to which such Lender is a subsidiary (a “ Parent Company ”) (i)
is adjudicated as, or determined by any Governmental Authority having regulatory authority over it or its assets to be, insolvent, (ii) becomes the subject of a
bankruptcy or insolvency proceeding, or the Administrative Agent has given written notice to such Lender and the Borrower of its good faith determination that such
Lender or its Parent Company has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or (iii) has had
a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its
business appointed for it, or the Administrative Agent has given written notice to such Lender and the Borrower of its good faith determination that such Lender or its
Parent Company has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such appointment; provided that a
Bankruptcy Event shall not result solely by virtue of any control of or ownership interest in, or the acquisition of any control of or ownership interest in, such Lender
or its Parent Company by a Governmental Authority as long as such control or ownership interest does not result in or provide such Lender or its Parent Company
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 its Parent Company (or such Governmental Authority) to reject, repudiate, disavow or disaffirm such Lender’s obligations under this Agreement.
“ Basel III ” means, collectively, those certain agreements on capital requirements, leverage ratios and liquidity standards contained in “Basel III: A Global
Regulatory Framework for More Resilient Banks and Banking Systems,” “Basel III: International Framework for Liquidity Risk Measurement, Standards and
Monitoring,” and “Guidance for National Authorities Operating the Countercyclical Capital Buffer,” each as published by the Basel Committee on Banking
Supervision in December 2010 (as revised from time to time), and as implemented by a
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Lender’s primary U.S. federal banking regulatory authority or primary non-U.S. financial regulatory authority, as applicable.
“ Board ” means the Board of Governors of the Federal Reserve System of the United States of America.
“ Board of Directors ” means the Board of Directors of the Borrower or, other than for the purposes of the definition of “Change of Control,” any committee
thereof duly authorized to act on behalf of such Board of Directors.
“ Borrower ” means The Match Group, Inc., a Delaware corporation.
“Borrower Materials” has the meaning assigned to such term in Section 9.18.
“ Borrowing ” means a group of Loans of the same Type, made, converted or continued on the same date and, in the case of Eurocurrency Loans, as to which
a single Interest Period is in effect.
“ Borrowing Date ” means any Business Day specified by the Borrower as a date on which the Borrower requests the relevant Lenders to make Loans
hereunder.
“ Business Day ” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law
to remain closed; provided that when used in connection with (a) a Eurocurrency Loan denominated in Dollars, the term “Business Day” shall also exclude any day on
which banks are not open for dealings in Dollar deposits in the London interbank market, (b) any Borrowings or LC Disbursements that are the subject of a
borrowing, drawing, payment, reimbursement or rate selection denominated in Euro, the term “Business Day” shall also exclude any day on which the Trans-
European Real-time Gross Settlement Operating System (or any successor operating system) is not open for the settlement of payments in Euro and (c) a
Eurocurrency Loan denominated in an Alternative Currency, the term “Business Day” shall also exclude any day on which banks are not open for dealings in such
Alternative Currency deposits in the interbank market in the principal financial center of the country whose lawful currency is such Alternative Currency.
“ Canadian Dollar ” means the lawful currency of Canada.
“Capital Expenditures” means, for the Borrower and its Restricted Subsidiaries in respect of any period, the aggregate of all expenditures incurred by such
person during such period that, in accordance with GAAP, are or should be included in “additions to property, plant or equipment” or similar items reflected in the
statement of cash flows of such person; provided, however, that Capital Expenditures for the Borrower and its Restricted Subsidiaries shall not include:
(a) expenditures to the extent made with proceeds of the issuance of Qualified Equity Interests of the Borrower or capital contributions to the Borrower or
funds that would have constituted Net Proceeds under clause (a) of the definition of the term “Net Proceeds” (but that will not constitute Net Proceeds as a result of
the first or second proviso to such clause (a));
(b) expenditures of proceeds of insurance settlements, condemnation awards and other settlements in respect of lost, destroyed, damaged or condemned
assets, equipment or other property to the extent such expenditures are made to replace or repair such lost, destroyed, damaged or condemned assets, equipment or
other property or otherwise to acquire, maintain, develop, construct, improve, upgrade or repair assets or properties useful
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in the business of the Borrower and its Restricted Subsidiaries to the extent such proceeds are not then required to be applied to prepay Term Loans pursuant to
Section 2.08(c)(1);
(c) interest capitalized during such period;
(d) expenditures that are accounted for as capital expenditures of such person and that actually are paid for by a third party (excluding the Borrower or any
Restricted Subsidiary) and for which none of the Borrower or any Restricted Subsidiary has provided or is required to provide or incur, directly or indirectly, any
consideration or obligation to such third party or any other person (whether before, during or after such period);
(e) the book value of any asset owned by such person 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
that such expenditure actually is made and (ii) such book value shall have been included in Capital Expenditures when such asset was originally acquired;
(f) the purchase price of equipment purchased during such period to the extent that the consideration therefor consists of any combination of (i) used or
surplus equipment traded in at the time of such purchase, (ii) the proceeds of a concurrent sale of used or surplus equipment, in each case, in the ordinary course of
business or (iii) any Asset Swap;
(g) Investments in respect of an Asset Acquisition; or
(h) the purchase of property, plant or equipment made with proceeds from any Asset Sale or Recovery Event to the extent such proceeds are not then
required to be applied to prepay Term Loans pursuant to Section 2.08(c)(1).
“ Capital Lease Obligations ” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a
balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP;
provided , however , that any obligations relating to a lease that would have been accounted by such Person as an operating lease in accordance with GAAP as of the
Closing Date shall be accounted for as an operating lease and not a Capital Lease Obligation for all purposes under this Agreement.
“ Cash Equivalents ” means (1) marketable direct obligations issued by, or unconditionally guaranteed by, the United States government or issued by any
agency thereof and backed by the full faith and credit of the United States, in each case maturing within one year from the date of acquisition; (2) certificates of
deposit, time deposits, eurodollar time deposits or overnight bank deposits having maturities of one year or less from the date of acquisition issued by any commercial
bank organized under the laws of the United States or any state thereof or any Lender or any Affiliate of any Lender; (3) commercial paper of an issuer rated at least
A-1 by Standard & Poor’s or P-1 by Moody’s, or carrying an equivalent rating by a nationally recognized rating agency, if both of the two named rating agencies
cease publishing ratings of commercial paper issuers generally, and maturing within one year from the date of acquisition; (4) repurchase obligations of any
commercial bank satisfying the requirements of clause (2) of this definition with respect to securities issued or fully guaranteed or insured by the United States
government; (5) securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the
United States, by any political subdivision or taxing authority of any such state,
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commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or foreign
government (as the case may be) are rated at least A by Standard & Poor’s or A by Moody’s; (6) securities with maturities of one year or less from the date of
acquisition backed by standby letters of credit issued by any commercial bank satisfying the requirements of clause (2) of this definition; (7) money market mutual or
similar funds that invest exclusively in assets satisfying the requirements of clauses (1) through (6) of this definition; (8) money market funds that (i) comply with the
criteria set forth in SEC Rule 2a-7 under the Investment Company Act of 1940, as amended, (ii) are rated AAA by Standard & Poor’s or Aaa by Moody’s and (iii)
have portfolio assets of at least $5,000,000,000; and (9) in the case of any Foreign Subsidiary, investments substantially comparable to any of the foregoing
investments with respect to the country in which such Foreign Subsidiary is organized.
“ Cash Management Agreement ” means any agreement entered into from time to time by the Borrower or any Restricted Subsidiary in connection with
Cash Management Services for collections, other Cash Management Services or for operating, payroll and trust accounts of such Person, including automatic clearing
house services, controlled disbursement services, electronic funds transfer services, information reporting services, lockbox services, stop payment services and wire
transfer services, unless, when entered into, such agreement is designated in writing by the Borrower and the relevant Cash Management Bank to the Administrative
Agent to not be included as a Cash Management Agreement.
“ Cash Management Bank ” means any Person that (i) at the time it enters into a Cash Management Agreement or provides any Cash Management Services,
is a Lender or an Agent Party or an Affiliate of a Lender or an Agent Party or (ii) in the case of any Cash Management Agreement in effect or any Cash Management
Services provided, on or prior to the Closing Date, is, as of the Closing Date, a Lender or an Agent Party or an Affiliate of a Lender or an Agent Party and a party to a
Cash Management Agreement or provider of Cash Management Services.
“ Cash Management Obligations ” means obligations owed by the Borrower or any Subsidiary Guarantor to any Cash Management Bank in connection with,
or in respect of, any Cash Management Services.
“ Cash Management Services ” means (a) commercial credit cards, merchant card services, purchase or debit cards, including non-card e-payables services,
(b) treasury management services (including controlled disbursement, overdraft automatic clearing house fund transfer services, return items and interstate depository
network services) and (c) any other demand deposit or operating account relationships or other cash management services, including under any Cash Management
Agreements.
“ CDOR Rate ” means for any Loans in Canadian Dollars, the CDOR Screen Rate or, if applicable pursuant to the terms of Section 2.11(a), the applicable
Reference Bank Rate.
“ CDOR Screen Rate ” means, with respect to any Interest Period, the average rate for bankers acceptances as administered by the Investment Industry
Regulatory Organization of Canada (or any other Person that takes over the administration of that rate) with a tenor equal in length to such Interest Period, as
displayed on CDOR page of the Reuters screen or, in the event such rate does not appear on such Reuters page, on any successor or substitute page on such screen or
service that displays such rate, or on the appropriate page of such other information service that publishes such rate as shall be selected from time to time by the
Administrative Agent in its reasonable discretion.
“ CFC ” means a “controlled foreign corporation” within the meaning of Section 957 of the Code.
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“ Change in Law ” means (a) the adoption of any law, rule, regulation or treaty after the Closing Date, (b) any change in any law, rule, regulation or treaty or
in the interpretation or application thereof by any Governmental Authority after the Closing Date or (c) compliance by any Lender (or, for purposes of Section
2.12(b), by any lending office of such Lender or by such Lender’s holding company, if any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the Closing Date; provided that, notwithstanding anything herein to the contrary, (x) the Dodd-Frank
Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests,
rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar
authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law,” but only to
the extent it is the general policy of a Lender to impose applicable increased costs or costs in connection with capital adequacy requirements similar to those described
in clauses (a) and (b) of Section 2.12 generally on other similarly situated borrowers under similar circumstances under agreements permitting such impositions.
“ Change of Control ” means any of the following events:
(a) the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the assets of the Borrower and its subsidiaries,
taken as a whole, to any Person other than a Permitted Holder;
(b) the acquisition of beneficial ownership by any person or group (excluding any one or more Permitted Holders or group Controlled by any one
or more Permitted Holders) of more than 35% of the aggregate voting power of all outstanding classes or series of the Borrower’s Voting Stock and such
aggregate voting power exceeds the aggregate voting power of all outstanding classes or series of the Borrower’s Voting Stock beneficially owned by the
Permitted Holders collectively;
(c) during any period of two consecutive years, individuals who at the beginning of such period constituted the Board of Directors of the
Borrower (together with any new directors whose election by the Board of Directors or whose nomination for election by the equityholders of the Borrower
was approved by a vote of the majority of the directors of the Borrower then still in office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Borrower’s Board of Directors then in
office;
(d) the Borrower shall adopt a plan of liquidation or dissolution or any such plan shall be approved by the stockholders of the Borrower; or
(e) a “change of control triggering event” (or similar event) shall occur in any document pertaining to Permitted Ratio Debt the Senior Notes or
any Refinancing Indebtedness thereof, in each case, to the extent constituting Material Indebtedness.
Notwithstanding the foregoing, a transaction in which the Borrower becomes a subsidiary of another Person (other than a Person that is an individual or a Permitted
Holder) shall not constitute a Change of Control if the shareholders of the Borrower immediately prior to such transaction beneficially own, directly or indirectly
through one or more intermediaries, the same proportion of voting power of the outstanding classes or series of the Borrower’s voting stock as such shareholders
beneficially own immediately following the consummation of such transaction.
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For purposes of this definition, a Person shall not be deemed to have beneficial ownership of securities subject to a stock purchase agreement, merger
agreement or similar agreement until the consummation of the transactions contemplated by such agreement.
“ CIM” means the Confidential Information Memorandum dated October 27, 2015 and made available to the Lenders in connection with the Lender meeting
held on October 27, 2015 with respect to the Term Facility and this Agreement.
“ Class ” (a) when used in reference to any Loans or Borrowing, refers to whether such Loans or the Loans comprising such Borrowing, are Revolving
Loans, Term B-1 Loans, Incremental Term Loans established pursuant to any Incremental Assumption Agreement, Extended Term Loans or Extended Revolving
Loans established pursuant to any Extension Amendment or Refinancing Term Loans or Replacement Revolving Facility Commitments Loans established pursuant to
any Refinancing Amendment or (b) when used in reference to any Commitments, refers to whether such Commitment is in respect of a commitment to make
Revolving Loans, Term B-1 Loans, Incremental Term Loans established pursuant to any Incremental Assumption Agreement, Extended Term Loans or Extended
Revolving Loans established pursuant to any Extension Amendment or Refinancing Term Loans or Replacement Revolving Loans established pursuant to any
Refinancing Amendment.
“ Closing Date ” means the date on which the conditions precedent set forth in Section 4.01 shall have been satisfied (or waived in accordance with Section
9.02).
“ Code ” means the Internal Revenue Code of 1986, as amended from time to time.
“ Co-Documentation Agents ” means Deutsche Bank AG New York Branch, BNP Paribas and Goldman Sachs Bank USA BMO Capital Markets Corp.,
Fifth Third Bank, SG Americas Securities, LLC and PNC Capital Markets LLC .
“ Collateral ” has the meaning assigned to such term or a similar term in each of the Collateral Documents and shall include all property pledged or granted
(or purported to be pledged or granted) as collateral pursuant to the Pledge Agreement on the Closing Date or thereafter pursuant to Section 5.09.
“ Collateral Agent ” means JPMorgan Chase Bank, N.A. in its capacity as collateral agent under the Guarantee Agreement and the Collateral Documents for
the Secured Parties.
“ Collateral Documents ” means the Pledge Agreement , the Pari Passu Intercreditor Agreement, if any, and each other security document, mortgage, pledge
agreement or collateral agreement executed and delivered in connection with this Agreement and/or the other Loan Documents to grant a security interest in any
property as collateral to secure the Obligations.
“ Commitment ” means, with respect to each Lender (to the extent applicable), such Lender’s Incremental Commitment, Revolving Commitment, Term
Loan Commitment or Extended Revolving Commitment, as applicable.
“ Commitment Fee Rate ” means (a) prior to the first Adjustment Date occurring after the Closing Date, 0.35% and (b) on and after the first Adjustment Date
occurring after the Closing Date, a rate determined in accordance with the Pricing Grid.
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“ 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.
“ Consolidated Amortization Expense ” for any Test Period means the amortization expense of the Borrower and its Restricted Subsidiaries for such Test
Period, determined on a consolidated basis in accordance with GAAP.
“ Consolidated Contingent Consideration Fair Value Remeasurement Adjustments ” for any period means the contingent consideration fair value
remeasurement adjustments, of the Borrower and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.
“ Consolidated Depreciation Expense ” for any Test Period means the depreciation expense of the Borrower and its Restricted Subsidiaries for such Test
Period, determined on a consolidated basis in accordance with GAAP.
“ Consolidated EBITDA ” for any Test Period means, without duplication, the sum of the amounts for such Test Period of
(1) Consolidated Net Income, plus
(2) in each case only to the extent (and in the same proportion) deducted in determining Consolidated Net Income,
(a) Consolidated Income Tax Expense,
(b) Consolidated Amortization Expense,
(c) Consolidated Depreciation Expense,
(d) Consolidated Interest Expense,
(e) all non-cash compensation, as reported in the Borrower’s financial statements,
(f) any non-cash charges or losses or realized losses related to the write-offs, write-downs or mark-to-market adjustments or sales or
exchanges of any investments in debt or equity securities by the Borrower or any Restricted Subsidiary,
(g) the aggregate amount of all other non-cash charges, expenses or losses reducing such Consolidated Net Income, including any
impairment (including any impairment of intangibles and goodwill) (excluding any non-cash charge, expense or loss that results in an accrual of a
reserve for cash charges in any future period and any non-cash charge, expense or loss relating to write-offs, write downs or reserves with respect to
accounts receivable or inventory), for such Test Period, and
(h) the amount of any restructuring charges or reserves, including any one-time costs incurred in connection with acquisitions, minus
(3) in each case only to the extent (and in the same proportion) included in determining Consolidated Net Income, any non-cash or realized gains
related to mark-to-market adjustments or sales or exchanges of any investments in debt or equity securities by the Borrower or any Restricted Subsidiary,
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in each case determined on a consolidated basis in accordance with GAAP; provided that the aggregate amount of all non-cash items, determined on a consolidated
basis, to the extent such items increased Consolidated Net Income for such period will be excluded from Consolidated Net Income.
For purposes of this definition, whenever pro forma effect is to be given, the pro forma calculations shall be factually supportable, reasonably identifiable
and made in good faith by a Financial Officer. Any such pro forma calculation may include adjustments appropriate, in the reasonable good faith determination of the
Borrower as set forth in an Officer’s Certificate, to reflect cost savings and other operating improvements or synergies reasonably expected to be realized within 12
months from the applicable event to be given pro forma effect; provided that the aggregate amount of all items added back to Consolidated EBITDA pursuant to this
paragraph and clause (A)(2) of the definition of “Consolidated Net Leverage Ratio” shall not exceed 10.0 % of Consolidated EBITDA (prior to giving effect to such
adjustment) for such Test Period.
“ Consolidated Income Tax Expense ” for any Test Period means the provision for taxes of the Borrower and its Restricted Subsidiaries for such Test Period,
determined on a consolidated basis in accordance with GAAP.
“ Consolidated Interest Expense ” for any Test Period means the sum, without duplication, of the total interest expense of the Borrower and its Restricted
Subsidiaries for such Test Period, determined on a consolidated basis in accordance with GAAP, minus consolidated interest income of the Borrower and its
Restricted Subsidiaries, and including, without duplication,
(1) imputed interest on Capital Lease Obligations,
(2) commissions, discounts and other fees and charges owed with respect to letters of credit securing financial obligations, bankers’ acceptance
financing and receivables financings,
(3) the net costs associated with Hedging Obligations related to interest rates,
(4) amortization of debt issuance costs, debt discount or premium and other financing fees and expenses,
(5) the interest portion of any deferred payment obligations,
(6) all other non-cash interest expense,
(7) capitalized interest,
(8) all dividend payments on any series of Disqualified Equity Interests of the Borrower or any Preferred Stock of any Restricted Subsidiary
(other than any such Disqualified Equity Interests or any Preferred Stock held by the Borrower or a Restricted Subsidiary of the Borrower that is a Wholly
Owned Subsidiary or to the extent paid in Qualified Equity Interests),
(9) all interest payable with respect to discontinued operations, and
(10) all interest on any Indebtedness described in clause (6) or (7) of the definition of “Indebtedness”,
but excluding, without duplication,
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(x) on and prior to the Separation Date, interest expense in respect of guarantees by any one or more members of the Match Group of
Indebtedness of any one or more members of the IAC Group, and(y) interest on any Pre-IPO Note.
“ Consolidated Net Income ” for any Test Period means the net income (or loss) of the Borrower and the Restricted Subsidiaries for such Test Period
determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from such net income (to the extent otherwise included therein),
without duplication:
(1) the net income (or loss) of any Person that is not a Restricted Subsidiary, except to the extent that cash in an amount equal to any such income
has actually been received by the Borrower or any Restricted Subsidiary during such period;
(2) gains and losses due solely to fluctuations in currency values and the related tax effects according to GAAP;
(3) gains and losses with respect to Hedging Obligations;
(4) the cumulative effect of any change in accounting principles;
(5) any extraordinary or nonrecurring gain (or extraordinary or nonrecurring loss), together with any related provision for taxes on any such
extraordinary or nonrecurring gain (or the tax effect of any such extraordinary or nonrecurring loss), realized by the Borrower or any Restricted Subsidiary
during such period;
(6) Consolidated Contingent Consideration Fair Value Remeasurement Adjustments;
(7) any net after-tax income or loss from discontinued operations and any net after-tax gains or losses on disposal of discontinued operations; and
(8) any gain (or loss), together with any related provisions for taxes on any such gain (or the tax effect of any such loss), realized during such
period by the Borrower or any Restricted Subsidiary upon (a) the acquisition of any securities, or the extinguishment of any Indebtedness, of the Borrower or
any Restricted Subsidiary or (b) the sale of any financial or equity investment by the Borrower or any Restricted Subsidiary;
provided , further, that the effects of any adjustments in the inventory, property and equipment, software, goodwill, other intangible assets, in-process research and
development, deferred revenue, debt line items, any earn-out obligations and any other non-cash charges (other than the amortization of unfavorable operating leases)
in the Borrower’s consolidated financial statements pursuant to GAAP in each case resulting from the application of purchase accounting in relation to any
consummated acquisition or the amortization or write-off of any such amounts shall be excluded when determining Consolidated Net Income.
“ Consolidated Net Leverage Ratio ” means, as of any date of determination, the ratio of (a) Indebtedness of the Borrower and its Restricted Subsidiaries as
of the last day of the Test Period most recently ended on or prior to such date of determination (as set forth on the balance sheet and determined on a consolidated
basis in accordance with GAAP (but excluding, (x) on and prior to the Separation Date, Indebtedness consisting of guarantees by any one or more members of the
Match Group of Indebtedness of any one or more members of the IAC Group and (y) any Pre-IPO Note) minus the amount of unrestricted cash and Cash Equivalents
of the Borrower and its Restricted
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Subsidiaries on such date in an amount not to exceed (x) prior to the Term B-1 Loan Repayment Date, $100,000,000 (or, solely with respect to calculating the
Consolidated Net Leverage Ratio for purposes of (i) incurring Permitted Unsecured Ratio Debt, unsecured Indebtedness pursuant to Section 6.01(g) and unsecured
Indebtedness pursuant to Section 6.01(z), (ii) the Match Transaction Distributions and (iii) the Pricing Grid and actual compliance (and not pro forma compliance or
compliance on a pro forma basis) with Section 6.10, $200,000,000) and (y) on or after the Term B-1 Loan Repayment Date, $200,000,000 to (b) Consolidated
EBITDA for such Test Period.
(A) The Consolidated Net Leverage Ratio shall be calculated for any period after giving effect on a pro forma basis (as if they had occurred on the first day
of the applicable Test Period) to:
(1) the incurrence of any Indebtedness of the Borrower or any Restricted Subsidiary (and the application of the proceeds thereof) and any
repayment, repurchase, defeasance or other discharge of Indebtedness (and the application of the proceeds therefrom) (other than the incurrence or
repayment of Indebtedness in the ordinary course of business for working capital purposes pursuant to any revolving credit arrangement) occurring during
the applicable Test Period or (except when calculating the Consolidated Net Leverage Ratio for purposes of determining the Applicable Rate or determining
actual compliance (and not pro forma compliance or compliance on a pro forma basis) with Section 6.10) at any time subsequent to the last day of such Test
Period and on or prior to the date of determination, as if such incurrence, repayment, issuance or redemption, as the case may be (and the application of the
proceeds thereof), occurred on the first day of the Test Period; and
(2) any (w) Asset Sale, (x) asset sale if the Fair Market Value of the assets sold in such transaction or series of related transactions exceeds
$2,000,000, which is solely excluded from the definition of Asset Sale pursuant to clause (7) of such definition, (y) Asset Acquisition (including, without
limitation, any Asset Acquisition giving rise to the need to make such calculation as a result of the Borrower or any Restricted Subsidiary (including any
Person who becomes a Restricted Subsidiary as a result of such Asset Acquisition or as a result of a Revocation) incurring Acquired Indebtedness and also
including any Consolidated EBITDA associated with any such Asset Acquisition) or (z) operational restructuring (each a “ pro forma event ”) (including any
cost savings and synergies resulting from head count reduction, closure of facilities and similar operational and other cost savings and synergies relating to
such pro forma event occurring within 12 months (or expected, in the good faith determination of the Borrower, to occur within 12 months) of such pro
forma event and during such period or (except when calculating the Consolidated Net Leverage Ratio for purposes of determining the Applicable Rate or
determining actual compliance (and not pro forma compliance or compliance on a pro forma basis) with Section 6.10) subsequent to such period and on or
prior to the date of such calculation, in each case that are expected to have a continuing impact and are factually supportable, and which adjustments the
Borrower determines are reasonable as set forth in an Officer’s Certificate; provided that the aggregate amount of all such cost savings and synergies
pursuant to this clause (A)(2) and the second paragraph of the definition of “Consolidated EBITDA” shall in no event exceed 10 % of Consolidated EBITDA
for such period calculated prior to giving effect to such pro forma adjustments) occurring during the Test Period or at any time subsequent to the last day of
the Test Period and on or prior to the date of determination, as if such pro forma event occurred on the first day of the Test Period and; provided , further that
asset sales described in clause (A)(2)(x) in an aggregate amount not to exceed $50,000,000 in any Test Period shall not be required to be given pro forma
effect; and
(B) in calculating Consolidated Interest Expense for purposes of the Consolidated Net Leverage Ratio with respect to any Indebtedness being given pro
forma effect:
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(1) interest on outstanding Indebtedness determined on a fluctuating basis as of the date of determination and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such Indebtedness in effect on the date of
determination;
(2) if interest on any Indebtedness actually incurred on the date of determination may optionally be determined at an interest rate based upon a
factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rates, then the interest rate in effect on the date of determination will be
deemed to have been in effect during the Test Period;
(3) notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a fluctuating basis, to the extent such interest is covered by
agreements relating to Hedging Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of the agreements
governing such Hedging Obligations;
(4) interest on any Indebtedness under a revolving credit facility shall be computed based upon the average daily balance of such Indebtedness
during the Test Period; and
(5) interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a responsible financial or
accounting Officer of the Borrower to be the rate of interest implicit in such Capital Lease Obligation in accordance with GAAP.
“Consolidated Working Capital” means, with respect to the Borrower and its Restricted Subsidiaries on a consolidated basis at any date of determination,
Current Assets at such date of determination minus Current Liabilities at such date of determination; provided that increases or decreases in Consolidated Working
Capital shall be calculated without regard to any changes in Current Assets or Current Liabilities as a result of (a) any reclassification in accordance with GAAP of
assets or liabilities, as applicable, between current and noncurrent or (b) the effects of purchase accounting.
“ Contractual Obligation ” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its property is bound.
“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise. “ Controlling ” and “ Controlled ” have meanings correlative thereto.
“Current Assets” means, with respect to the Borrower and its Restricted Subsidiaries on a consolidated basis at any date of determination, all assets (other
than cash, Cash Equivalents or other cash equivalents) that would, in accordance with GAAP, be classified on a consolidated balance sheet of the Borrower and its
Restricted Subsidiaries as current assets at such date of determination, other than amounts related to current or deferred taxes based on income or profits.
“Current Liabilities” means, with respect to the Borrower and its Restricted Subsidiaries on a consolidated basis at any date of determination, all liabilities
that would, in accordance with GAAP, be classified on a consolidated balance sheet of the Borrower and its Restricted Subsidiaries as current liabilities at such date of
determination, other than (a) the current portion of any Indebtedness, (b) accruals of Consolidated Interest Expense (excluding Consolidated Interest Expense that is
due and unpaid), (c) accruals for current or deferred taxes based on
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income or profits, (d) accruals, if any, of transaction costs resulting from the Transactions, (e) accruals of any costs or expenses related to (i) severance or termination
of employees prior to the Closing Date or (ii) bonuses, pension and other post-retirement benefit obligations, and (f) accruals for exclusions from Consolidated Net
Income included in clause (5) of the definition of such term.
“ Default ” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived,
become an Event of Default.
“ Defaulting Lender ” means any Lender that (a) has failed, within two Business Days of the date required to be funded or paid, to (i) fund any portion of its
Loans, (ii) fund any portion of its participations in Letters of Credit or (iii) pay over to any Agent Party any amount required to be paid by it hereunder, unless, in the
case of clause (i) above, such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s good faith
determination that a condition precedent to such funding or payment has not been satisfied, or, in the case of clause (ii) or clause (iii) above, such Lender notifies the
Administrative Agent in writing that such failure is the result of a good faith dispute regarding its obligation to make such funding or payment; (b) has notified the
Borrower or any Agent Party in writing, or has made a public statement to the effect, that it does not intend to comply with any of its funding or payment obligations
under this Agreement (unless such writing or public statement indicates that such position is based on such Lender’s good faith determination that a condition
precedent to such funding or payment under this Agreement cannot be satisfied); (c) has failed, within three Business Days after request by the Administrative Agent
or Issuing Bank, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply with its obligations under this
Agreement, provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon such Agent Party’s receipt of such certification; or (d) has
become the subject of a Bankruptcy Event.
“ Designated Noncash Consideration ” means the Fair Market Value of noncash consideration received by the Borrower or a Restricted Subsidiary in
connection with an Asset Sale that is so designated as Designated Noncash Consideration pursuant to an Officer’s Certificate, setting forth the basis of such valuation,
less the amount of cash or Cash Equivalents received in connection with a subsequent sale of such Designated Noncash Consideration.
“ Designation ” has the meaning assigned to such term in the definition of “Unrestricted Subsidiary.”
“ Designation Amount ” has the meaning assigned to such term in the definition of “Unrestricted Subsidiary.”
“ Disclosed Matters ” means the actions, suits and proceedings and the environmental matters disclosed in Schedule 3.06.
“ Disposition ” means, with respect to any property, any sale, lease, license, sale and leaseback, assignment, conveyance, transfer or other disposition thereof.
The terms “ Dispose ” and “ Disposed of ” shall have correlative meanings.
“ Disqualified Equity Interests ” of any Person means any class of Equity Interests of such Person that, by its terms, or by the terms of any related agreement
or of any security into which it is convertible, puttable or exchangeable, is, or upon the happening of any event or the passage of time would be, required to be
redeemed by such Person, whether or not at the option of the holder thereof, or matures or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, in whole or in part, in each case on or prior to the date that is 91 days after the Revolving Termination Date; provided , however , that any class of Equity
Interests of such Person that, by its
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terms, authorizes such Person to satisfy in full its obligations with respect to the payment of dividends or upon maturity, redemption (pursuant to a sinking fund or
otherwise) or repurchase thereof or otherwise by the delivery of Equity Interests that are not Disqualified Equity Interests, and that is not convertible, puttable or
exchangeable for Disqualified Equity Interests or Indebtedness, will not be deemed to be Disqualified Equity Interests so long as such Person satisfies its obligations
with respect thereto solely by the delivery of Equity Interests that are not Disqualified Equity Interests; provided , further , however , that any Equity Interests that
would not constitute Disqualified Equity Interests but for provisions thereof giving holders thereof (or the holders of any security into or for which such Equity
Interests are convertible, exchangeable or exercisable) the right to require the Borrower to redeem such Equity Interests upon the occurrence of a change of control
occurring prior to the 91 st day after the Revolving Termination Date shall not constitute Disqualified Equity Interests if such Equity Interests specifically provide that
the Borrower will not redeem any such Equity Interests pursuant to such provisions prior to the Obligations (other than (x) (i) Cash Management Obligations and (ii)
Obligations under Specified Swap Agreements not yet due and payable, and (y) contingent obligations not yet accrued and payable) having been paid in full, all
Letters of Credit having been cash collateralized or otherwise back-stopped or having been terminated, and the Total Revolving Commitments having been
terminated.
“ Dollar Amount ” means, at any date, (a) with respect to any amount denominated in Dollars, such amount and (b) with respect to any amount denominated
in amount other than Dollars, such amount converted to Dollars by the Administrative Agent at the Exchange Rate on such date.
“ Dollars ” or “ $ ” refers to lawful money of the United States of America.
“ Domestic Subsidiary ” means any Restricted Subsidiary of the Borrower that is not a Foreign Subsidiary.
“ EMU ” means the economic and monetary union in accordance with the Treaty of Rome 1957, as amended by the Single European Act 1986, the
Maastricht Treaty of 1992 and the Amsterdam Treaty of 1998.
“ EMU Legislation ” means the legislative measures of the European Council for the introduction of, changeover to or operation of a single or unified
European currency.
“ Environmental Law ” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the
management, release or threatened release of any Hazardous Material.
“ Environmental Liability ” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Restricted Subsidiary 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.
“ Equity Interests ” means, of any Person, (1) any and all shares or other equity interests (including common stock, preferred stock, limited liability company
interests and partnership interests) in such Person and (2) all rights to purchase, warrants or options (whether or not currently exercisable), participations or other
equivalents of or interests in (however designated) such shares or other interests in such Person, but excluding any debt securities convertible into such shares or other
interests.
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“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time.
“ ERISA Affiliate ” means any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section
414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.
“ ERISA Event ” means (a) any “reportable event” (as defined in Section 4043(c) of ERISA or the regulations issued thereunder) with respect to a Plan other
than an event for which the 30-day notice period is waived; (b) any failure by any Plan to satisfy the minimum funding standards (within the meaning of Sections 412
or 430 of the Code or Section 302 of ERISA) applicable to such Plan, whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of
ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the failure to make by its due date a required installment under
Section 430(j) of the Code with respect to any Plan or the failure by the Borrower or any of its ERISA Affiliates to make any required contribution to a Multiemployer
Plan; (e) the incurrence by the Borrower or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan, including
but not limited to the imposition of any Lien in favor of the PBGC or any Plan; (f) a determination that any Plan is, or is expected to be, in “at risk” status (within the
meaning of Section 430 of the Code or Title IV of ERISA); (g) the receipt by the Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any
notice relating to an intention to terminate any Plan or to appoint a trustee to administer any Plan; (h) the incurrence by the Borrower or any of its ERISA Affiliates of
any liability with respect to the withdrawal or partial withdrawal from any Plan (or a cessation of operations that is treated as such a withdrawal under Section 4062(e)
of ERISA) or Multiemployer Plan; or (i) the receipt by the Borrower or any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the
Borrower or any ERISA Affiliate of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to
be, Insolvent, in Reorganization or in endangered or critical status, within the meaning of Section 432 of the Code or Section 305 of ERISA.
“ Escrow Assumption Agreement ” means an assumption agreement in form reasonably satisfactory to the Administrative Agent, among the Borrower and
the Administrative Agent.
“ Escrow Assumption ” means with respect to (i) any Escrow Permitted Ratio Debt, the assumption of the Escrow Borrower’s obligations with respect
thereto by the Borrower or (ii) any Incremental Term Loan that is initially established as an Escrow Incremental Term Loan, the assumption of the Escrow Borrower’s
obligations with respect thereto by the Borrower pursuant to an Escrow Assumption Agreement.
“ Escrow Borrower ” means an Unrestricted Subsidiary established to borrow Escrow Permitted Ratio Debt or Escrow Incremental Term Loans (pending
assumption of such Escrow Permitted Ratio Debt or Escrow Incremental Term Loans by the Borrower) and that is not engaged in any material operations and does not
have any other material assets other than in connection therewith.
“ Escrow Incremental Term Loan ” means any Indebtedness that is initially borrowed by an Escrow Borrower that would constitute an Incremental Term
Loan if borrowed by the Borrower and that is not guaranteed by any other subsidiary of the Borrower and, if secured, is secured only by the proceeds of such Escrow
Incremental Term Loan, unless and until the Borrower has assumed all of the obligations of the Escrow Borrower with respect thereto.
“ Escrow Permitted Ratio Debt ” means any Indebtedness that is initially borrowed by an Escrow Borrower that would constitute Permitted Ratio Debt if
borrowed by the Borrower and that is not guaranteed by any other
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subsidiary of the Borrower and, if secured, is secured only by the proceeds of such Escrow Permitted Ratio Debt, unless and until the Borrower has assumed all of the
obligations of the Escrow Borrower with respect thereto.
“ Euro ” and “ EUR ” mean the lawful currency of the Participating Member States introduced in accordance with EMU Legislation.
“ Eurocurrency ” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Eurocurrency Rate.
“ Eurocurrency Rate ” means, with respect to (A) any Eurocurrency Borrowing in any LIBOR Quoted Currency and for any applicable Interest Period, the
LIBOR Screen Rate as of the Applicable Specified Time on the Quotation Day for such currency and Interest Period and (B) any Eurocurrency Borrowing in any
Non-Quoted Currency and for any applicable Interest Period, the applicable Local Screen Rate for such Non-Quoted Currency as of the Applicable Time and on the
Quotation Day for such currency and Interest Period; provided , that, if a LIBOR Screen Rate or a Local Screen Rate, as applicable, shall not be available at the
applicable time for the applicable Interest Period (an “ Impacted Interest Period ”), then the Eurocurrency Rate for such currency and Interest Period shall be the
Interpolated Rate; provided , further , that if the applicable Screen Rate shall not be available for such Interest Period and/or for the applicable currency with respect to
such Eurocurrency Borrowing for any reason and the Administrative Agent shall determine that it is not possible to determine the Interpolated Rate (which conclusion
shall be conclusive and binding absent manifest error), then the applicable Reference Bank Rate shall be the Eurocurrency Rate for such Interest Period for such
Eurocurrency Borrowing; subject to Section 2.11; provided that, (i) if any Eurocurrency Rate shall be less than zero, such rate shall be deemed to be zero for purposes
of this Agreement and (ii) solely with respect to the Term B-1 Loans, the Eurocurrency Rate shall not be less than 1.00% .
“ Event of Default ” has the meaning assigned to such term in Section 7.01.
“Excess Cash Flow” means, for any period, an amount equal to the excess of:
(a) the sum, without duplication, of
(i) Consolidated Net Income for such period,
(ii) an amount equal to the amount of all non-cash charges to the extent deducted in arriving at such Consolidated Net Income and cash receipts
included in clauses (5), (7) and (8) of the definition of Consolidated Net Income and excluded in arriving at such Consolidated Net Income,
(iii) decreases in Consolidated Working Capital for such period (other than any such decreases arising from dispositions outside the ordinary course
of business by the Borrower and its Restricted Subsidiaries completed during such period),
(iv) cash receipts by the Borrower and its Restricted Subsidiaries in respect of Hedging Obligations during such fiscal year to the extent not
otherwise included in such Consolidated Net Income; and
(v) the amount by which tax expense deducted in determining such Consolidated Net Income for such period exceeded taxes (including penalties
and interest) paid in cash or tax reserves set aside or payable (without duplication) by the Borrower and its Restricted Subsidiaries in such period,
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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 and cash charges included in clauses
(5), (7) and (8) of the definition of Consolidated Net Income and included in arriving at such Consolidated Net Income,
(ii) without duplication of amounts deducted pursuant to clause (ix) below in prior years, the amount of Capital Expenditures or acquisitions of
Intellectual Property made in cash during such period by the Borrower and its Restricted Subsidiaries, except to the extent that such Capital Expenditures or
acquisitions were financed with the proceeds of Indebtedness of the Borrower or its Restricted Subsidiaries (other than under the Revolving Facility),
(iii) the aggregate amount of all principal payments of Indebtedness of the Borrower and its Restricted Subsidiaries (including (A) the principal
component of payments in respect of Capital Lease Obligations and (B) the amount of any scheduled repayment of Term Loans, but excluding (x) all other
prepayments of Term Loans, (y) all prepayments of Revolving Loans and (z) all prepayments in respect of any other revolving credit facility, except in the
case of clauses (y) and (z) to the extent there is an equivalent permanent reduction in commitments thereunder), except to the extent financed with the
proceeds of other Indebtedness (other than under the Revolving Facility) of the Borrower or its Restricted Subsidiaries,
(iv) increases in Consolidated Working Capital for such period (other than any such increases arising from acquisitions by the Borrower and its
Restricted Subsidiaries completed during such period or the application of purchase accounting),
(v) payments by the Borrower and its Restricted Subsidiaries during such period in respect of long-term liabilities of the Borrower and the
Subsidiaries other than Indebtedness, to the extent not already deducted from Consolidated Net Income,
(vi) without duplication of amounts deducted pursuant to clause (ix) below in prior fiscal years, the aggregate amount of cash consideration paid by
the Borrower and the Subsidiaries (on a consolidated basis) in connection with Investments (including acquisitions) made during such period pursuant to
Section 6.11 (except for those Investments made under Section 6.11(b) and (d)) to the extent that such Investments were financed with internally generated
cash flow of the Borrower and its Restricted Subsidiaries,
(vii) the amount of Restricted Payments during such period (on a consolidated basis) by the Borrower and its Restricted Subsidiaries made in
compliance with Section 6.05 (other than Section 6.05(iii), (iv), (vii), (xiii) and (xiv)) to the extent such Restricted Payments were financed with internally
generated cash flow of the Borrower and its Restricted Subsidiaries,
(viii) the aggregate amount of any premium, make-whole or penalty payments actually paid in cash by the Borrower and its Restricted Subsidiaries
during such period that are made in connection with any prepayment of Indebtedness to the extent that such payments are not deducted in calculating
Consolidated Net Income,
(ix) 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 its Restricted Subsidiaries pursuant to binding contracts (the “Contract Consideration”) entered into prior to or during such period
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relating to Asset Acquisitions, Capital Expenditures or acquisitions of intellectual property to be consummated or made during the period of four consecutive
fiscal quarters of the Borrower following the end of such period, provided that to the extent the aggregate amount of internally generated cash actually
utilized to finance such Asset Acquisition, Capital Expenditures or acquisitions of intellectual property during such period of four consecutive fiscal quarters
is less than the Contract Consideration, the amount of such shortfall shall be added to the calculation of Excess Cash Flow at the end of such period of four
consecutive fiscal quarters,
(x) the amount of taxes (including penalties and interest) paid in cash or tax reserves set aside or payable (without duplication) in such period to the
extent they exceed the amount of tax expense deducted in determining Consolidated Net Income for such period; and
(xi) cash expenditures in respect of Hedging Obligations during such fiscal year to the extent not deducted in arriving at such Consolidated Net
Income.
“Excess Cash Flow Period” means each fiscal year of the Borrower, commencing with the fiscal year of the Borrower ending December 31, 2016; provided
that the first Excess Cash Flow Period hereunder shall begin on the first day of the first full fiscal quarter to occur on or after the earlier of (x) the date of the Match
Offering and (y) the date that is six months after the Term B-1 Effective Date.
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.
“ Exchange Rate ” means, on any day, with respect to Dollars in relation to any Alternative Currency, the rate at which Dollars may be exchanged into such
Alternative Currency, as set forth at approximately 11:00 a.m., New York City time, on such day on the applicable Reuters World Spot Page. In the event that such
rate does not appear on the applicable Reuters World Spot Page, the Exchange Rate shall be determined by reference to such other publicly available service for
displaying exchange rates as may be agreed upon by the Administrative Agent and the Borrower or, in the absence of such agreement, the 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 11:00 a.m., London time, on such date for the purchase of such Alternative Currency with Dollars, for delivery on such
date, in the case where such Alternative Currency is Sterling, or two Business Days later, in the case of each other Alternative Currency; provided that if at the time of
any such determination, for any reason, no such spot rate is being reasonably quoted, the Administrative Agent, after consultation with the Borrower, may use any
reasonable method it deems appropriate to determine such rate, and such determination shall be conclusive absent manifest error.
“ Excluded Equity Interests ” means any Equity Interests (a) of any subsidiary (i) for which the pledge of its Equity Interests is prohibited by applicable law
or by Contractual Obligations existing on the Closing Date (or, in the case of a newly acquired subsidiary, in existence at the time of acquisition but not entered into in
contemplation thereof) or for which governmental (including regulatory) consent, approval, license or authorization would be required or (ii) that is not a Material
Subsidiary or (b) of any Foreign Subsidiary or FSHCO in excess of 65% of each class of outstanding Equity Interests of such Foreign Subsidiary or FSHCO.
“Excluded Indebtedness” means all Indebtedness not incurred in violation of Section 6.01.
“ Excluded Subsidiary ” means (a) any subsidiary that is not a Wholly Owned Subsidiary, (b) any subsidiary that is prohibited by applicable law or by
Contractual Obligations existing on the Closing Date (or, in the case of any newly acquired subsidiary, in existence at the time of acquisition but not entered into in
contemplation thereof) from
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guaranteeing the Obligations or if guaranteeing the Obligations would require governmental (including regulatory) consent, approval, license or authorization, (c) any
subsidiary that is not a Material Domestic Subsidiary, (d) any Unrestricted Subsidiary, (e) any FSHCO and (f) any Domestic Subsidiary that is a direct or indirect
subsidiary of a Foreign Subsidiary that is a CFC; provided that no subsidiary of the Borrower that Guarantees the IAC Credit Agreement or the IAC Senior Notes
shall be deemed to be 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 Guarantee of such
Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee 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 (a) such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations
thereunder or (b) in the case of a Swap Obligation subject to a clearing requirement pursuant to Section 2(h) of the Commodity Exchange Act (or any successor
provision thereto), because such Guarantor is a “financial entity,” as defined in Section 2(h)(7)(C)(i) of the Commodity Exchange Act (or any successor provision
thereto), in each case at the time the Guarantee of such Guarantor or the grant of such security interest becomes effective with respect to such Swap Obligation, unless
otherwise agreed between the Administrative Agent and the Borrower. 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 Guarantee or security interest is or becomes illegal.
“ Excluded Taxes ” means (a) in the case of each Lender and the Administrative Agent, taxes imposed on its overall net income, and franchise taxes imposed
on it in lieu of net income taxes by a jurisdiction (including any political subdivision thereof) as a result of (i) such Lender or the Administrative Agent’s being
organized under the laws of or having a principal office in such jurisdiction and, in the case of a Lender, having an applicable lending office in such jurisdiction or (ii)
a present or former connection between such Lender or the Administrative Agent and the jurisdiction (other than any connection arising solely from such Lender or
the Administrative Agent 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 and/or enforced any Loan Document); (b) any tax in the nature of branch profits taxes imposed by any
jurisdiction described in clause (a); (c) in the case of a Non-U.S. Lender, United States federal withholding tax imposed pursuant to laws in effect on the date on
which (i) such Non-U.S. Lender becomes a Lender or (ii) such Non-U.S. Lender changes its lending office, except in each case to the extent that, pursuant to Section
2.14, additional amounts with respect to such taxes were payable either to such Non-U.S. Lender’s assignor immediately before such Non-U.S. Lender became a party
hereto or to such Non-U.S. Lender immediately before it changed its lending office; (d) any taxes attributable to such Lender’s failure to comply with Section 2.14(e)
and (e) any United States federal withholding taxes imposed under FATCA.
“ Extended Revolving Commitment ” shall have the meaning assigned to such term in Section 2.19(a).
“ Extended Revolving Loan ” shall have the meaning assigned to such term in Section 2.19(a).
“ Extended Term Loan ” shall have the meaning assigned to such term in Section 2.19(a).
“ Extending Lender ” shall have the meaning assigned to such term in Section 2.19(a).
“ Extension ” shall have the meaning assigned to such term in Section 2.19(a).
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“ Extension Amendment ” shall have the meaning assigned to that term in Section 2.19(b).
“ Fair Market Value ” means, with respect to any asset, as determined by the Borrower, the price (after taking into account any liabilities relating to such
assets) that would be negotiated in an arm’s‑length transaction for cash between a willing seller and a willing and able buyer, neither of which is under any
compulsion to complete the transaction.
“ Facility ” means any of (a) the Revolving Facility and (b) the Term Facility.
“ 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 and any agreements entered into
pursuant to Section 1471(b)(1) of the current Code (or any amended or successor version described above) and any intergovernmental agreements implementing the
foregoing.
“ Federal Funds Effective Rate ” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on overnight
Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the
Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next
1/100 of 1%) charged to the Administrative Agent on such day on such transactions from three Federal funds brokers of recognized standing selected by it.
“ Financial Officer ” means the chief financial officer, principal accounting officer, treasurer or controller of the Borrower.
“ Foreign Lender ” means any Lender that is not a “United States person” as defined in Section 7701(a)(30) of the Code.
“ Foreign Subsidiary ” means any Restricted Subsidiary of the Borrower that is organized under the laws of any jurisdiction other than the United States, any
State thereof or the District of Columbia.
“ FSHCO ” means any Domestic Subsidiary that owns no material assets other than Equity Interests of one or more Foreign Subsidiaries that are CFCs or
Equity Interests of one or more other FSHCOs.
“ GAAP ” means generally accepted accounting principles 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 may be approved by a significant segment of the accounting profession of the United States, consistently applied.
“ Governmental Authority ” means the government of the United States of America, any other nation or any political subdivision thereof, whether state,
local, provincial or otherwise 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.
“ Guarantee ” of or by any Person (the “ guarantor ”) means a direct or indirect guarantee by any Person of any Indebtedness of any other Person and
includes any obligation, direct or indirect, contingent or otherwise, of such Person (1) to purchase or pay (or advance or supply funds for the purchase or payment of)
Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by agreements to keep well, to purchase
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assets, goods, securities or services (unless such purchase arrangements are on arm’s length terms and are entered into in the ordinary course of business), to take-or-
pay, or to maintain financial statement conditions or otherwise); or (2) entered into for purposes of assuring in any other manner the obligee of such Indebtedness of
the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); “ Guarantee ,” when used as a verb, and “ Guaranteed ” have
correlative meanings.
“ Guarantee Agreement ” means the Guarantee Agreement to be executed and delivered by each Subsidiary Guarantor and each IAC Guarantor ,
substantially in the form of Exhibit C.
“ guarantor ” has the meaning assigned to such term in the definition of “Guarantee.”
“ Hazardous Materials ” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.
“ Hedging Obligations ” of any Person means the obligations of such Person under swap, cap, collar, forward purchase or similar agreements or
arrangements dealing with interest rates, currency exchange rates or commodity prices, either generally or under specific contingencies.
“ IAC ” means IAC/InterActiveCorp., a Delaware corporation.
“ IAC 2012 Senior Notes ” means the $500,000,000 aggregate principal amount of 4.75% senior notes due 2022 issued by IAC on December 21, 2012 and
any exchange notes related thereto.
“ IAC 2013 Senior Notes ” means the $500,000,000 aggregate principal amount of 4.875% senior notes due 2018 issued by IAC on November 15, 2013 and
any exchange notes related thereto.
“ IAC Credit Agreement ” means the credit agreement dated as of December 21, 2012, as amended and restated on or about the Closing Date (as further
amended, restated, extended, supplemented or otherwise modified from time to time) among IAC, the lenders party thereto from time to time and JPMorgan Chase
Bank, N.A. as administrative agent and collateral agent.
“ IAC Facility Collateral Agent ” means JPMorgan Chase Bank, N.A., in its capacity as collateral agent for the secured parties under the IAC Credit
Agreement.
“ IAC Group ” means IAC and its subsidiaries not including the Match Group.
“ IAC Guarantor ” means any member of the IAC Group that is an obligor under the IAC Credit Agreement or the IAC Senior Notes.
“ IAC/Match Intercompany Debt ” means subject to compliance by IAC on a pro forma basis with Section 6.10 of the IAC Credit Agreement as in effect on
the Closing Date, the incurrence prior to the Match Offering, extension of existing or settlement of (x) unsecured intercompany loans, intercompany payables and
intercompany receivables between the Match Group and the IAC Group or (y) any intercompany contributions from the IAC Group to the Match Group (and, in each
case, payments or distributions thereon), in each case (i) under intercompany arrangements existing as of the Closing Date or put in place in connection with the
Match Offering or related transactions, (ii) in connection with the acquisition of Plentyoffish Media Inc. or (iii) in connection with cash
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management arrangements; provided that, to the extent any IAC/Match Intercompany Debt remains outstanding or is incurred following the Separation Date, the
Consolidated Net Leverage Ratio (calculated on a pro forma basis) on the Separation Date (or if incurred after the Separation Date, the date of such incurrence) shall
be equal to or less than 4.50 to 1.00.
“ IAC Senior Notes ” means the IAC 2012 Senior Notes and the IAC 2013 Senior Notes.
“ IAC Subordinated Debt Facility ” has the meaning assigned to such term in Section 6.01(z).
“ Impacted Interest Period ” has the meaning assigned to such term in the definition of “Eurocurrency Rate.”
“ Incremental Amount ” means, at any time, the greater of:
(a) the excess (if any) of
(i) $150,000,000 over
in each case, established after the Closing Date and prior to such time and outstanding pursuant to Section 2.02; and
(ii) the aggregate amount of all Incremental Term Loan Commitments and Incremental Revolving Commitments,
(b) any amounts so long as immediately after giving pro forma effect to the establishment of the commitments in respect thereof, any Asset
Acquisition consummated concurrently therewith and the use of proceeds of the loans thereunder, both (x) the Secured Net Leverage Ratio is equal to or less
than 3.50 (i) prior to the Term B-1 Loan Repayment Date, 2.25 to 1.00 (or, if such Incremental Facility is incurred in connection with the Match
Transactions, 4.00 to 1.00) and (ii) on or after the Term B-1 Loan Repayment Date, 3.50 to 1.00 and (y) the Consolidated Net Leverage Ratio is equal to or
less than 4.50 to 1.00, in each case, only on the date of the initial incurrence of (or commitment in respect of) the applicable Incremental Facility (except as
set forth in the final paragraph under Section 6.01) and calculated (x) as if any commitments in respect of Ratio Debt and Incremental Revolving
Commitments were fully drawn on the effective date thereof and (y) excluding any cash constituting proceeds of any such Incremental Facility or any
simultaneous incurrence of Ratio Debt.
“ Incremental Assumption Agreement ” means an Incremental Assumption Agreement in form and substance reasonably satisfactory to the Administrative
Agent, among the Borrower, the Administrative Agent and, if applicable, one or more Incremental Term Lenders and/or Incremental Revolving Lenders or, in the
case of any Escrow Incremental Term Loans, the Escrow Assumption Agreement in respect thereof.
“Incremental Assumption Agreement No. 1” means the Incremental Assumption Agreement and Amendment No. 1 dated as of the Term B-1 Effective Date
relating to the Term B-1 Loans.
“ Incremental Commitment ” means an Incremental Term Loan Commitment or an Incremental Revolving Commitment.
“ Incremental Facility ” means the Incremental Commitments and the Incremental Loans made thereunder.
“ Incremental Loan ” means an Incremental Term Loan or an Incremental Revolving Loan.
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“ Incremental Revolving Commitment ” means the commitment of any Lender, established pursuant to Section 2.02, to make Incremental Revolving Loans
to the Borrower.
“ Incremental Revolving Lender ” means a Lender with an Incremental Revolving Commitment or an outstanding Incremental Revolving Loan.
“ Incremental Revolving Loan ” means Revolving Loans made by one or more Revolving Lenders to the Borrower pursuant to an Incremental Revolving
Commitment to make additional Revolving Loans.
“ Incremental Term A Facility ” means any Incremental Term Facility designated by the Borrower as an “Incremental Term A Facility.”
“ Incremental Term A Loans ” means any term loans borrowed under an Incremental Term A Facility.
“ Incremental Term Facility ” means the Incremental Term Loan Commitments and the Incremental Term Loans made thereunder.
“ Incremental Term Lender ” means a Lender with an Incremental Term Loan Commitment or an outstanding Incremental Term Loan.
“ Incremental Term Loan Commitment ” means the commitment of any Lender, established pursuant to Section 2.02, to make Incremental Term Loans to
the Borrower. Any commitment of any lender established pursuant to Section 2.02(d) to make Escrow Incremental Term Loans to an Escrow Borrower shall not
constitute Incremental Term Loan Commitments unless and until the Borrower has assumed all of the obligations of the Escrow Borrower with respect thereto in
accordance with Section 2.02(d).
“ Incremental Term Loans ” means any term loans borrowed in connection with an Incremental Assumption Agreement. Any Escrow Incremental Term
Loans shall not constitute Incremental Term Loans unless and until the Borrower has assumed all of the obligations of the Escrow Borrower with respect thereto in
accordance with Section 2.02(d).
“ Indebtedness ” of any Person at any date means, without duplication:
(1) all liabilities, contingent or otherwise, of such Person for borrowed money;
(2) all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;
(3) all reimbursement obligations of such Person in respect of letters of credit, letters of guaranty, bankers’ acceptances and similar credit
transactions;
(4) all obligations of such Person to pay the deferred and unpaid purchase price of property or services, except (i) trade payables and accrued
expenses incurred by such Person in the ordinary course of business and (ii) amounts accrued associated with contingent consideration arrangements;
(5) all Capital Lease Obligations of such Person;
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(6) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person;
(7) all Indebtedness of others Guaranteed by such Person to the extent of such Guarantee; provided that Indebtedness of the Borrower or its
subsidiaries that is Guaranteed by the Borrower or the Borrower’s subsidiaries shall only be counted once in the calculation of the amount of Indebtedness of
the Borrower and its subsidiaries on a consolidated basis; and
(8) all obligations of such Person under conditional sale or other title retention agreements relating to assets purchased by such Person (excluding
obligations arising from inventory transactions in the ordinary course of business).
The amount of any Indebtedness which is incurred at a discount to the principal amount at maturity thereof as of any date shall be deemed to have been incurred at the
accreted value thereof as of such date. The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date of all unconditional
obligations as described above, the maximum liability of such Person for any such contingent obligations at such date and, in the case of clause (6), the lesser of (a)
the Fair Market Value of any asset subject to a Lien securing the Indebtedness of others on the date that the Lien attaches and (b) the amount of the Indebtedness
secured.
“ Indemnified Taxes ” means all Taxes other than Excluded Taxes.
“ Indemnitee ” has the meaning assigned to such term in Section 9.04(b).
“ Information ” has the meaning assigned to such term in Section 9.13.
“ Insolvent ” with respect to any Multiemployer Plan means the condition that such Multiemployer Plan is insolvent within the meaning of Section 4245 of
ERISA.
“ Intellectual Property ” means the collective reference to all rights, priorities and privileges relating to intellectual property, whether arising under United
States, multinational or foreign laws or otherwise, including copyrights, patents, trademarks, service marks, trade dress, internet domain names, software, data,
databases, technology, know-how, trade secrets, processes and other confidential or proprietary information, together with all registrations and applications for
registration thereof, all licenses thereof or pertaining thereto, and all rights to sue at law or in equity for any infringement or other impairment thereof, including the
right to receive all proceeds and damages therefrom.
“ Interest Coverage Ratio ” means, as of any date of determination, the ratio of (a) Consolidated EBITDA of the Borrower and its Restricted Subsidiaries for
the Test Period most recently ended on or prior to such date of determination to (b) Consolidated Interest Expense for such Test Period.
(A) The Interest Coverage Ratio shall be calculated for any period after giving effect on a pro forma basis (as if they had occurred on the first day of the
applicable Test Period) to:
(1) the incurrence of any Indebtedness of the Borrower or any Restricted Subsidiary (and the application of the proceeds thereof) and any
repayment, repurchase, defeasance or other discharge of Indebtedness (and the application of the proceeds therefrom) (other than the incurrence or
repayment of Indebtedness in the ordinary course of business for working capital purposes pursuant to any revolving
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credit arrangement) occurring during the applicable Test Period or (except when calculating the Interest Coverage Ratio for purposes of determining actual
compliance (and not pro forma compliance or compliance on a pro forma basis) with Section 6.10) at any time subsequent to the last day of such Test Period
and on or prior to the date of determination, as if such incurrence, repayment, issuance or redemption, as the case may be (and the application of the proceeds
thereof), occurred on the first day of the Test Period;
(2) any (w) Asset Sale, (x) asset sale if the Fair Market Value of the assets sold in such transaction or series of related transactions exceeds
$2,000,000 individually, which is solely excluded from the definition of Asset Sale pursuant to clause (7) of such definition, (y) Asset Acquisition
(including, without limitation, any Asset Acquisition giving rise to the need to make such calculation as a result of the Borrower or any Restricted Subsidiary
(including any Person who becomes a Restricted Subsidiary as a result of such Asset Acquisition or as a result of a Revocation) incurring Acquired
Indebtedness and also including any Consolidated EBITDA associated with any such Asset Acquisition) or (z) operational restructuring (each a “ pro forma
event ”) (including any cost savings and synergies resulting from head count reduction, closure of facilities and similar operational and other cost savings
and synergies relating to such pro forma event occurring within 12 months (or expected, in the good faith determination of the Borrower, to occur within 12
months) of such pro forma event and during such period or (except when calculating the Interest Coverage Ratio for purposes of determining actual
compliance (and not pro forma compliance or compliance on a pro forma basis) with Section 6.10) subsequent to such period and on or prior to the date of
such calculation, in each case that are expected to have a continuing impact and are factually supportable, and which adjustments the Borrower determines
are reasonable as set forth in an Officer’s Certificate; provided that the aggregate amount of all such cost savings and synergies pursuant to this clause (A)(2)
and the second paragraph of the definition of “Consolidated EBITDA” shall in no event exceed 10 % of Consolidated EBITDA for such period calculated
prior to giving effect to such pro forma adjustments) occurring during the Test Period or at any time subsequent to the last day of the Test Period and on or
prior to the date of determination, as if such pro forma event occurred on the first day of the Test Period, and, provided , further , that asset sales described in
clause (A)(2)(x) in an aggregate amount not to exceed $50,000,000 in any Test Period shall not be required to be given pro forma effect; and
(B) in calculating Consolidated Interest Expense for purposes of the Interest Coverage Ratio with respect to any Indebtedness being given pro forma effect:
(1) interest on outstanding Indebtedness determined on a fluctuating basis as of the date of determination and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such Indebtedness in effect on the date of
determination;
(2) if interest on any Indebtedness actually incurred on the date of determination may optionally be determined at an interest rate based upon a
factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rates, then the interest rate in effect on the date of determination will be
deemed to have been in effect during the Test Period;
(3) notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a fluctuating basis, to the extent such interest is covered by
agreements relating to Hedging Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of the agreements
governing such Hedging Obligations;
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(4) interest on any Indebtedness under a revolving credit facility shall be computed based upon the average daily balance of such Indebtedness
during the Test Period; and
(5) interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a responsible financial or
accounting Officer of the Borrower to be the rate of interest implicit in such Capital Lease Obligation in accordance with GAAP.
“ Interest Election Request ” means a request by the Borrower to convert or continue a Borrowing in accordance with Section 2.05.
“ Interest Payment Date ” means (a) with respect to any ABR Loan, the last day of each March, June, September and December and (b) with respect to any
Eurocurrency Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurocurrency Borrowing with an
Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration after the
first day of such Interest Period.
“ Interest Period ” means, as to any Eurocurrency Loan, (a) initially, the period commencing on the borrowing or conversion date, as the case may be, with
respect to such Eurocurrency Loan and ending one week, one month, two months, three months or six months (or, if available to all Lenders under the applicable
Facility, twelve months) thereafter, as selected by the Borrower in its notice of borrowing or notice of conversion, as the case may be, given with respect thereto, and
(b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurocurrency Loan and ending one week, one month,
two months, three months or six months (or, if agreed to by all Lenders under the applicable Facility, twelve months or such other, shorter period) thereafter, as
selected by the Borrower by irrevocable notice to the Administrative Agent not later than 12:00 noon, New York City time (or in the case of an Alternative Currency,
11:00 a.m., London time), on the date that is three Business Days prior to the last day of the then current Interest Period with respect thereto; provided that all of the
foregoing provisions relating to Interest Periods are subject to the following:
(i) if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next
succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendar month in which event such Interest
Period shall end on the immediately preceding Business Day;
or an Interest Period for a Term Loan that would extend beyond the date the final payment is due on such Term Loan; and
(ii) the Borrower may not select an Interest Period for a Revolving Loan that would extend beyond the Revolving Termination Date
(iii) any Interest Period of at least one month’s duration that begins on the last Business Day of a calendar month (or on a day for
which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar
month.
“ Interpolated Rate ” means, at any time, for any Interest Period, the rate per annum (rounded to the same number of decimal places as the relevant Screen
Rates) determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from
interpolating on a linear basis between: (a) the applicable Screen Rate (for the longest period for which the applicable Screen Rate is available for the applicable
currency) that is shorter than the Impacted Interest Period and (b) the applicable Screen Rate for the shortest period (for which such Screen Rate is available for the
applicable currency) that exceeds the Impacted Interest Period, in each case, as of the Specified Time on the Quotation Day for
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such Interest Period. When determining the rate for a period which is less than the shortest period for which the relevant Screen Rate is available, the applicable
Screen Rate for purposes of paragraph (a) above shall be deemed to be the overnight screen rate where “overnight screen rate” means, in relation to any currency, the
overnight rate for such currency determined by the Administrative Agent from such service as the Administrative Agent may select.
“ Investments ” has the meaning assigned to such term in Section 6.11.
“ ISP ” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law &
Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).
“ Issuing Bank ” means JPMorgan Chase Bank, N.A., Bank of America, N.A. and each other Issuing Bank designated pursuant to Section 2.17(j), each in its
capacity as an issuer of Letters of Credit, and its successors in such capacity as provided in Section 2.17(i). The Borrower may, with the consent of the Administrative
Agent (which consent shall not be unreasonably withheld), arrange for one or more Letters of Credit to be issued by other Lenders, in which case the term “Issuing
Bank” shall include such Lender with respect to the Letters of Credit issued by such Lender; provided that no such Lender shall have any obligation to be an Issuing
Bank unless it agrees to do so in its sole discretion.
“ Judgment Currency ” has the meaning assigned to such term in Section 9.14.
“ Junior Debt ” means Indebtedness for borrowed money that is (x) unsecured, or (y) by its terms subordinated or junior in right of payment or security to the
Obligations, in each case with an aggregate outstanding principal amount in excess of $50,000,000.
“ Junior Debt Restricted Payment ” means, any payment or other distribution (whether in cash, securities or other property), directly or indirectly made by
the Borrower or any if its Restricted Subsidiaries, of or in respect of principal of or interest on any Junior Debt (or any Indebtedness incurred as Refinancing
Indebtedness in respect thereof); provided , that the following shall not constitute a Junior Debt Restricted Payment:
(a) refinancings with any Refinancing Indebtedness permitted to be incurred under Section 6.01;
(b) payments of regularly-scheduled interest and fees due thereunder, other non-principal payments thereunder, any mandatory prepayments of
principal, interest and fees thereunder, scheduled payments thereon necessary to avoid the Junior Debt from constituting “applicable high yield discount
obligations” within the meaning of Section 163(i)(l) of the Code, and principal on the scheduled maturity date of any Junior Debt;
(c) payments or distributions in respect of all or any portion of the Junior Debt with the proceeds from the issuance, sale or exchange by the
Borrower of Qualified Equity Interests within eighteen months prior thereto; or
(d) the conversion of any Junior Debt to Qualified Equity Interests of the Borrower.
“ Latest Maturity Date ” means, at any date of determination, the latest of the latest Revolving Termination Date and the latest maturity date in respect of any
Class of Term Loans, in each case then in effect on such date of determination.
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“ LC Disbursement ” means a payment made by the Issuing Bank pursuant to a demand for payment or drawing under a Letter of Credit.
“ LC Exposure ” means, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (b) the aggregate
amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure of any Lender at any time shall be
its Revolving Commitment Percentage of the total LC Exposure at such time. For purposes of computing the amount available to be drawn under any Letter of Credit,
the amount of such Letter of Credit shall be determined in accordance with Section 1.06. For all purposes of this Agreement, if on any date of determination a Letter
of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Letter of Credit shall be
deemed to be “outstanding” in the amount so remaining available to be drawn.
“ LC Participation Calculation Date ” means, with respect to any LC Disbursement made by the Issuing Bank or any refund of a reimbursement payment
made by the Issuing Bank to the Borrower, in each case in a currency other than Dollars, (a) the date on which such Issuing Bank shall advise the Administrative
Agent that it purchased with Dollars the currency used to make such LC Disbursement or refund or (b) if such Issuing Bank shall not advise the Administrative Agent
that it made such a purchase, the date on which such LC Disbursement or refund is made.
“ Lead Arrangers ” means, collectively, J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith, Incorporated, Deutsche Bank Securities Inc.,
BNP Paribas Securities Corp. and Goldman Sachs Lending Partners LLC, as joint lead arrangers and joint bookrunners.
“ Lender Presentation Presentations ” means the (i) Lender Presentation made available to the Lenders in connection with the Lender meeting held on
September 17, 2015 with respect to the Revolving Facility and this Agreement and (ii) Lender Presentation made available to the Lenders in connection with the
Lender meeting held on October 27, 2015 with respect to the Term B-1 Facility and this Agreement.
“ Lenders ” means the Persons listed on Schedule 1.01A and any other Person that shall have become a party hereto pursuant to an Assignment and
Assumption or any Incremental Assumption Agreement, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption.
“ Letter of Credit ” means any letter of credit issued pursuant to Section 2.17.
“ LIBOR Quoted Currency ” means Dollars, Euros, Sterling and Yen.
“ LIBOR Screen Rate ” means the London interbank offered rate administered by the ICE Benchmark Association (or any other Person that takes over the
administration of such rate) for such LIBOR Quoted Currency for a period equal in length to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of the
Reuters screen or, in the event such rate does not appear on either of such Reuters pages, on any successor or substitute page on such screen that displays such rate, or
on the appropriate page of such other information service that publishes such rate as shall be selected by the Administrative Agent from time to time in its reasonable
discretion.
“ Lien ” means, with respect to any asset, any mortgage, deed of trust, lien (statutory or other), pledge, easement, charge, security interest or other
encumbrance of any kind or nature in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including the interest of a
vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic
effect as any of the foregoing) relating to such asset. “Lien” shall not, however, include any
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interest of a vendor in any inventory of the Borrower or any of its Restricted Subsidiaries arising out of such inventory being subject to a “sale or return” arrangement
with such vendor or any consignment by any third party of any inventory to the Borrower or any of its Restricted Subsidiaries.
“ Limited Condition Acquisition ” means any acquisition, including by means of a merger, amalgamation or consolidation, by the Borrower or one or more
of its Restricted Subsidiaries, the consummation of which is not conditioned upon the availability of, or on obtaining, third party financing or in connection with
which any fee or expense would be payable by the Borrower or its Restricted Subsidiaries to the seller or target in the event financing to consummate the acquisition
is not obtained as contemplated by the definitive acquisition agreement.
“ Loan Documents ” means the collective reference to this Agreement, the Guarantee Agreement, the Collateral Documents, any Incremental Assumption
Agreement, the Letters of Credit and any amendments or waivers to any of the foregoing.
“ Loan Parties ” means the collective reference to the Borrower , and the Subsidiary Guarantors and, prior to the Separation Date, the IAC Guarantors .
“ Loans ” means the loans made by the Lenders to the Borrower pursuant to this Agreement.
“ Local Screen Rates ” means the Australian Dollar Screen Rate and the CDOR Screen Rate; provided , that, if any Local Screen Rate shall be less than zero,
such rate shall be deemed to be zero for purposes of this Agreement.
“ Match Group ” means the Borrower and its subsidiaries.
“ Match Offering ” means the issuance by the Borrower of up to an aggregate of 20% of the economic interest represented by all outstanding capital stock of
the Borrower as of the date of the Match Offering (after giving pro forma effect to the issuance of such capital stock in such offering) in an initial underwritten public
offering pursuant to an effective registration statement filed with the SEC pursuant to the Securities Act.
“ Match Transaction Distributions ” means dividends or distributions of cash and other property from the Match Group to the IAC Group (i) of a
combination of cash and/or Pre-IPO Notes which, in the aggregate, do not exceed the net cash proceeds of the Match Offering, (ii) of a combination of the net cash
proceeds of certain Indebtedness incurred by the Match Group on or prior to the date of the Match Offering and/or debt securities issued by Match or IAC (including
the Senior Notes) which, in the aggregate, do not exceed $1,500,000,000, in each case, designated by the Borrower as incurred in connection with the Match Offering,
(iii) of any cash on the balance sheet of the Match Group on the Closing Date and any cash flow of the Match Group accruing from and after the Closing Date until
the date of the Match Offering and (iv) without duplication, in an amount equal to any proceeds from cash common equity contributions received by the Match Group
after the Closing Date and prior to the date of the Match Offering, in each case so long as, on a pro forma basis after giving effect thereto and to the other transactions
consummated in connection therewith, (x) the Borrower is in compliance with Section 6.10, (y) no Default or Event of Default shall have occurred and be continuing
and (z) in the case of any dividend or distribution under clause (iii) above occurring on or after the Separation Date, on the date of such distribution, (A) the
Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00 and (B) no Loans are outstanding under the Revolving Facility.
“ Match Transactions ” means, the Match Offering, and in connection therewith, the entry into a number of related transactions and agreements with the IAC
Group, including, but not limited to:
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(a) entry into and consummation of the transactions contemplated under a master transaction agreement, an investor rights agreement, a services
agreement, a tax sharing agreement, an employee matters agreement and similar agreements and arrangements and the transactions in connection therewith;
(b) the IAC/Match Intercompany Debt;
(c) the Match Transaction Distributions;
(d) the entry into this Agreement and any Incremental Assumption Agreements and performance of the obligations hereunder and thereunder and
any related agreements, including any guarantee agreements or pledge agreements; and
(e) the creation of, and payments under, the IAC Subordinated Debt Facility.
“ Material Adverse Effect ” means a material adverse effect on (a) the business, operations, property or condition, financial or otherwise, of the Borrower
and its Restricted Subsidiaries taken as a whole that results in a material impairment of the ability of the Borrower to perform any payment obligations hereunder or
(b) the validity or enforceability of this Agreement or the other Loan Documents or the rights or remedies of the Administrative Agent (including in its capacity as
Collateral Agent) or the Lenders hereunder or thereunder.
“ Material Domestic Subsidiary ” means any Wholly Owned Subsidiary that is a Domestic Subsidiary of the Borrower, as of the last day of the fiscal quarter
of the Borrower most recently ended for which financial statements have been or are required to have been delivered, that has assets or revenues (including third party
revenues but not including intercompany revenues) with a value in excess of 2.50% of the consolidated assets of the Borrower and its Wholly Owned Subsidiaries that
are Domestic Subsidiaries or 2.50% of the consolidated revenues of the Borrower and its Wholly Owned Subsidiaries that are Domestic Subsidiaries; provided that in
the event Wholly Owned Subsidiaries that are Domestic Subsidiaries that would otherwise not be Material Domestic Subsidiaries shall in the aggregate account for a
percentage in excess of 7.50% of the consolidated assets of the Borrower and its Wholly Owned Subsidiaries that are Domestic Subsidiaries or 7.50% of the
consolidated revenues of the Borrower and its Wholly Owned Subsidiaries that are Domestic Subsidiaries as of the end of and for the most recently completed fiscal
quarter, then one or more of such Domestic Subsidiaries designated by the Borrower (or, if the Borrower shall make no designation, one or more of such Domestic
Subsidiaries in descending order based on their respective contributions to the consolidated assets of the Borrower), shall be included as Material Domestic
Subsidiaries to the extent necessary to eliminate such excess.
“ Material Indebtedness ” means Indebtedness (other than the Loans), or obligations in respect of a Swap Agreement, of any one or more of the Borrower
and its Restricted Subsidiaries in an aggregate principal amount exceeding $50,000,000. For purposes of determining Material Indebtedness, the “principal amount” of
the obligations of the Borrower or any Restricted Subsidiary in respect of any Swap Agreement at any time shall be the maximum aggregate amount (giving effect to
any netting agreements) that the Borrower or such Restricted Subsidiary would be required to pay if such Swap Agreement were terminated at such time.
“ Material Subsidiary ” means any Restricted Subsidiary of the Borrower, as of the last day of the fiscal quarter of the Borrower most recently ended for
which financial statements have been, or were required to be, delivered pursuant to Section 5.01, that has assets or revenues (including third party revenues but not
including intercompany revenues) with a value in excess of 1.0% of the consolidated assets of the Borrower or 1.0% of the consolidated revenues of the Borrower;
provided that in the event Restricted Subsidiaries that would otherwise not be Material Subsidiaries shall in the aggregate account for a percentage in excess of 7.5%
of the consolidated assets
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of the Borrower or 7.5% of the consolidated revenues of the Borrower as of the end of and for the most recently completed fiscal quarter for which financial
statements have been, or were required to be, delivered pursuant to Section 5.01, then one or more of such Restricted Subsidiaries designated by the Borrower (or, if
the Borrower shall make no designation, one or more of such Restricted Subsidiaries in descending order based on their respective contributions to the consolidated
assets of the Borrower), shall be included as Material Subsidiaries to the extent necessary to eliminate such excess.
“ Moody’s ” means Moody’s Investors Service, Inc.
“ Multiemployer Plan ” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
“Net Proceeds” means:
(a) 100% of the cash proceeds actually received by the Borrower or any Subsidiary (including any cash payments received by way of deferred payment of
principal pursuant to a note or installment receivable or purchase price adjustment receivable or otherwise, but only as and when received) from any Asset Sale, net of
(i) attorneys’ fees, accountants’ fees, investment banking fees, survey costs, title insurance premiums, and related search and recording charges, transfer Taxes, deed
or mortgage recording Taxes, other customary expenses and brokerage, consultant and other customary fees actually incurred in connection therewith, (ii) required
payments of Indebtedness (other than Indebtedness incurred under the Loan Documents or Other First Lien Debt) and required payments of other obligations relating
to the applicable asset to the extent such Indebtedness or other obligations are secured by a Lien permitted hereunder (other than pursuant to the Loan Documents,
Other First Lien Debt or obligations secured by a Lien that is junior to the Liens securing the Obligations), (iii) repayments of Other First Lien Debt (limited to its
proportionate share of such prepayment, based on the amount of such then outstanding debt as a percentage of all then outstanding Indebtedness incurred under the
Loan Documents and Other First Lien Debt), (iv) Taxes paid or payable (in the good faith determination of the Borrower) as a direct result thereof, and (v) the amount
of any reasonable reserve established in accordance with GAAP against any adjustment to the sale price or any liabilities (other than any Taxes deducted pursuant to
clause (i) or (iv) above) (x) related to any of the applicable assets and (y) retained by the Borrower or any of the Subsidiaries including, without limitation, pension
and other post-employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations (provided that (1) the amount
of any reduction of such reserve (other than in connection with a payment in respect of any such liability), prior to the date occurring 18 months after the date of the
respective Asset Sale, shall be deemed to be cash proceeds of such Asset Sale occurring on the date of such reduction and (2) the amount of any such reserve that is
maintained as of the date occurring 18 months after the date of the applicable Asset Sale shall be deemed to be Net Proceeds from such Asset Sale as of such date);
provided, that, if the Borrower shall deliver an Officer’s Certificate to the Administrative Agent promptly following receipt of any such proceeds setting forth the
Borrower’s intention to use any portion of such proceeds, within 12 months of such receipt, to acquire, maintain, develop, construct, improve, upgrade or repair assets
useful in the business of the Borrower and the Subsidiaries or to make Asset Acquisitions and other Investments permitted hereunder (excluding Cash Equivalents or
intercompany Investments in Subsidiaries) or to reimburse the cost of any of the foregoing incurred on or after the date on which the Asset Sale giving rise to such
proceeds was contractually committed (other than inventory), such portion of such proceeds shall not constitute Net Proceeds except to the extent not, within 365 days
of such receipt, so used or contractually committed to be so used (it being understood that if any portion of such proceeds are not so used within such 365 day period
but within such 365 day period are contractually committed to be used, then such remaining portion if not so used within 180 days following the end of such 365 day
period shall constitute Net Proceeds as of such date without giving effect to this proviso); provided, further, that no net cash proceeds calculated in accordance with
the foregoing realized in a single transaction or series of related transactions shall
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constitute Net Proceeds unless such net cash proceeds shall exceed (x) prior to the Term B-1 Loan Repayment Date, $50,000,000 and (y) on or after the Term B-1
Loan Repayment Date, $150,000,000 (and in each case thereafter only net cash proceeds in excess of such amount shall constitute Net Proceeds);
(b) 100% of the cash proceeds actually received by the Borrower or any Subsidiary (including casualty insurance settlements and condemnation awards,
but only as and when received) from any Recovery Event, net of (i) attorneys’ fees, accountants’ fees, transfer Taxes, deed or mortgage recording Taxes on such asset,
other customary expenses and brokerage, consultant and other customary fees actually incurred in connection therewith, (ii) required payments of Indebtedness (other
than Indebtedness incurred under the Loan Documents or Other First Lien Debt) and required payments of other obligations relating to the applicable asset to the
extent such Indebtedness or other obligations are secured by a Lien permitted hereunder (other than pursuant to the Loan Documents, Other First Lien Debt or
obligations secured by a Lien that is junior to the Liens securing the Obligations), (iii) repayments of Other First Lien Debt (limited to its proportionate share of such
prepayment, based on the amount of such then outstanding debt as a percentage of all then outstanding Indebtedness incurred under the Loan Documents and Other
First Lien Debt, and (iv) Taxes paid or payable (in the good faith determination of the Borrower) as a direct result thereof; provided, that, if the Borrower shall deliver
an Officer’s Certificate to the Administrative Agent promptly following receipt of any such proceeds setting forth the Borrower’s intention to use any portion of such
proceeds, within 365 days of such receipt, to acquire, maintain, develop, construct, improve, upgrade or repair assets useful in the business of the Borrower and the
Subsidiaries or to make Asset Acquisitions and other Investments permitted hereunder (excluding Cash Equivalents or intercompany Investments in Subsidiaries) or
to reimburse the cost of any of the foregoing incurred on or after the date on which the Recovery Event giving rise to such proceeds was contractually committed
(other than inventory, except to the extent the proceeds of such Recovery Event are received in respect of inventory), such portion of such proceeds shall not
constitute Net Proceeds except to the extent not, within 365 days of such receipt, so used or contractually committed to be so used (it being understood that if any
portion of such proceeds are not so used within such 365 day period but within such 365 day period are contractually committed to be used, then such remaining
portion if not so used within 180 days following the end of such 365 day period shall constitute Net Proceeds as of such date without giving effect to this proviso);
provided, further, that no net cash proceeds calculated in accordance with the foregoing realized in a single transaction or series of related transactions shall constitute
Net Proceeds unless such net cash proceeds shall exceed (x) prior to the Term B-1 Loan Repayment Date, $50,000,000 and (y) on or after the Term B-1 Loan
Repayment Date, $150,000,000 (and in each case thereafter only net cash proceeds in excess of such amount shall constitute Net Proceeds); and
(c) 100% of the cash proceeds from the incurrence, issuance or sale by the Borrower or any Subsidiary of any Indebtedness (other than Excluded
Indebtedness, except for Refinancing Term Loans), net of all fees (including investment banking fees), commissions, costs and other expenses, in each case incurred
in connection with such issuance or sale.
“ Non-Consenting Lender ” has the meaning assigned to such term in Section 2.16(c).
“ Non-Defaulting Lender ” means, at any time, each Lender that is not a Defaulting Lender at such time.
“ Non-Defaulting Revolving Lender ” means, at any time, each Revolving Lender that is not a Defaulting Lender at such time.
“ Non-Loan Party ” means any Restricted Subsidiary other than a Loan Party.
“ Non-Quoted Currency ” means each of Australian Dollars and Canadian Dollars .
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“ Non-U.S. Lender ” means any Lender that is not a U.S. Lender.
“ Obligations ” means the unpaid principal of and interest on (including interest, fees and expenses accruing after the maturity of the Loans and interest, fees
and expenses accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the
Borrower, whether or not a claim for post-filing or post-petition interest, fees and expenses is allowed in such proceeding) the Loans, the obligations of the Loan
Parties to reimburse the Issuing Bank for demands for payment or drawings under a Letter of Credit, and all other obligations and liabilities of the Borrower to the
Administrative Agent or to any Secured Party, whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, this Agreement, any other Loan Document, any Specified Swap Agreement, any Cash Management Agreement or any
other document made, delivered or given in connection herewith or therewith, whether on account of principal, interest, fees, indemnities, costs, expenses or otherwise
(including all fees, charges and disbursements of counsel to the Administrative Agent, the Lead Arrangers or to any Lender that are required to be paid by the
Borrower pursuant hereto). Notwithstanding the foregoing, the Obligations shall not include any Excluded Swap Obligations.
“ OFAC ” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.
“ Officer’s Certificate ” means a certificate of a Financial Officer in form and substance reasonably acceptable to the Administrative Agent.
“Other First Lien Debt” means obligations secured by Liens on the Collateral that are equal and ratable with the Liens thereon securing the Term B-1 Loans
pursuant to an intercreditor agreement reasonably satisfactory to the Administrative Agent.
“ Other Taxes ” means all present or future stamp or documentary Taxes or any other excise or property Taxes, charges or similar levies arising from any
payment made under any Loan Document or from the execution, delivery or enforcement or registration of, from the receipt or perfection of a security interest under,
or otherwise with respect to, any Loan Document.
“ Outstanding Revolving Credit ” means, with respect to any Revolving Lender at any time, an amount equal to the sum of (a) the aggregate then outstanding
principal amount of such Revolving Lender’s Revolving Loans and (b) such Revolving Lender’s LC Exposure.
“ parent ” has the meaning assigned to such term in the definition of “subsidiary.”
“ Parent Company ” has the meaning assigned to such term in the definition of “Bankruptcy Event.”
“ Pari Passu Intercreditor Agreement ” means an intercreditor agreement dated as of the first day of the Shared Collateral Period (if any), between the
Collateral Agent and the IAC Facility Collateral Agent substantially in the form attached as Exhibit J , with modifications, if any, that the Borrower and the Collateral
Agent may agree.
“ Participant ” has the meaning assigned to such term in Section 9.05(c).
“ Participant Register ” has the meaning assigned to such term in Section 9.05(c).
“ Participating Member State ” means any member state of the EMU which has the Euro as its lawful currency.
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“ PBGC ” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
“ Perfection Certificate ” means a certificate in the form of Exhibit H or any other form approved by the Administrative Agent (acting reasonably), as the
same shall be supplemented from time to time by any supplement thereto or otherwise.
“ Permitted Encumbrances ” means:
(a) Liens imposed by law for taxes, assessments or governmental charges that are not yet due or are being contested in compliance with Section
5.04;
(b) landlord’s, carriers’, warehousemen’s, mechanics’, supplier’s, materialmen’s, repairmen’s and other like Liens imposed by law, arising in the
ordinary course of business and securing obligations that are not overdue by more than 30 days or are being contested in compliance with Section 5.04;
(c) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation (or pursuant to letters of credit issued
in connection with such workers’ compensation compliance), unemployment insurance and other social security laws or regulations;
(d) deposits to secure the performance of tenders, bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds,
leases, subleases, government contracts and return-of-money bonds, letters of credit and other obligations of a like nature, in each case in the ordinary course
of business (exclusive of the obligation for the payment of borrowed money);
(e) judgment liens in respect of judgments that do not constitute an Event of Default under Section 7.01(j);
(f) easements, zoning restrictions, rights-of-way, survey exception, minor encumbrances, reservation of, licenses, electric lines, telegraph and
telephone lines and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary
obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any
Restricted Subsidiary;
(g) Liens securing obligations in respect of trade-related letters of credit and covering the goods (or the documents of title in respect of such
goods) financed or the purchase of which is supported by such letters of credit and the proceeds and products thereof;
(h) Liens upon specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’
acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods; and
(i) Liens securing obligations in respect of letters of credit, bank guarantees, warehouse receipts or similar instruments issued to support
performance obligations (other than Obligations in respect of Indebtedness) and trade-related letters of credit, in each case, outstanding on the Closing Date
or issued thereafter in and covering the goods (or the documents of title in respect of such goods) financed by such letters of credit, banker’s acceptances or
bank guarantees and the proceeds and products thereof.
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“ Permitted Holders ” means any one or more of (a) IAC and its wholly owned subsidiaries, (b) Barry Diller, (c) each of the respective Affiliated Persons of
the Person referred to in clause (b) and (d) any Person a majority of the aggregate voting power of all the outstanding classes or series of the equity securities of which
are beneficially owned by any one or more of the Persons referred to in clauses (a), (b) or (c).
“ Permitted Liens ” means Liens permitted by Section 6.02.
“ Permitted Mandatory Prepayments ” means with respect to any Indebtedness, any requirement to prepay such Indebtedness (i) in connection with any asset
sale or event of loss (with associated reinvestment rights), (ii) in respect of Refinancing Indebtedness, (iii) in respect of Indebtedness not permitted to be incurred by
the terms of such Indebtedness, (iv) in connection with any cash sweep provisions customary in the determination of the Borrower for term loan B facilities or (v) in
connection with any change of control.
“ Permitted Ratio Debt ” means Permitted Secured Ratio Debt and Permitted Unsecured Ratio Debt.
“ Permitted Secured Ratio Debt ” means Indebtedness of the Borrower so long as, (I) on a pro forma basis after giving effect thereto and the use of proceeds
thereof (calculated (x) as if any outstanding commitments for all such Indebtedness, Permitted Unsecured Ratio Debt and Incremental Commitments were fully drawn
on the effective date thereof and (y) excluding any cash constituting proceeds of any such Indebtedness or any simultaneous incurrence of Permitted Unsecured Ratio
Debt and/or Incremental Facilities), the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00 and the Secured Net Leverage Ratio is equal to or less
than 3.50 (x) prior to the Term B-1 Loan Repayment Date, 2.25 to 1.00 (or, if such Permitted Secured Ratio Debt is incurred in connection with the Match
Transactions, 4.00 to 1.00) , and (y) on or after the Term B-1 Loan Repayment Date, 3.50 to 1.00, in each case, only on the date of the initial incurrence of (or
commitment in respect of) such Indebtedness, (II) no Default shall have occurred and be continuing after giving effect thereto, (III) the Borrower shall be in
compliance with Section 6.10 as of the last day of the most recent Test Period on a pro forma basis after giving effect to the incurrence of any such Indebtedness and
the use of proceeds thereof, (IV) the maturity date of such Indebtedness shall be no earlier than the later of (x) 90 days following the Revolving Termination Date and
(y) 90 days after the scheduled final maturity date of any then outstanding Term Loans, Latest Maturity Date then in effect and such Indebtedness shall not require any
mandatory prepayments other than Permitted Mandatory Prepayments, (V) such Indebtedness (w) shall not require scheduled amortization payments (excluding the
final installment thereof) in excess of 1.00% per annum of the original aggregate principal amount thereof, (x) shall not have a Weighted Average Life to Maturity
that is shorter than the then longest remaining Weighted Average Life to Maturity of any then outstanding Term Loans, (y) shall have no financial maintenance
covenants of a different type than those set forth in Section 6.10, and no financial maintenance covenants that are more restrictive than those set forth in Section 6.10,
and (z) does not have negative covenants and/or default provisions that, taken as a whole, are materially more restrictive than those applicable to this Agreement as
determined in good faith by the Borrower unless, in each case of clauses (y) and (z) such terms become applicable only after the Revolving Facility shall have
matured or been terminated and any Term Loans existing at such date have been paid in full and , (VI) such Indebtedness is not guaranteed by any subsidiaries of the
Borrower that do not guarantee the Obligations and is secured on an equal and ratable or junior lien basis by the same Collateral (and no additional Collateral)
securing the Obligations pursuant to an intercreditor agreement reasonably satisfactory to the Administrative Agent and (VII) if such Indebtedness is in the form of
term loans, such Indebtedness shall be subject to the “most-favored nations” provision of Section 2.02(b)(v) as if such Indebtedness was incurred as an Incremental
Term Loan under this Agreement (and with pricing increases with respect to the Term B-1 Loans to occur as, and to the extent provided in the “most favored nations”
provision of Section 2.02(b)(v) as if such Indebtedness was incurred as an Incremental Term Loan hereunder) ; provided that the Escrow Assumption with respect to
any Escrow Permitted Ratio Debt shall
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not be permitted unless on the date thereof (after giving effect thereto) the conditions set forth above would be satisfied if the Borrower was borrowing such Permitted
Ratio Debt on the date of such Escrow Assumption; provided further any Escrow Permitted Ratio Debt shall not constitute Permitted Unsecured Ratio Debt unless the
Escrow Assumption with respect thereto shall have occurred.
“ Permitted Unsecured Ratio Debt ” means unsecured Indebtedness of the Borrower so long as, (I) on a pro forma basis after giving effect thereto and the use
of proceeds thereof (calculated (x) as if any outstanding commitments for all such Indebtedness, Permitted Secured Ratio Debt and Incremental Commitments were
fully drawn on the effective date thereof and (y) excluding any cash constituting proceeds of such Indebtedness or any simultaneous incurrence of Permitted Secured
Ratio Debt and/or Incremental Facilities), the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00 only on the date of the initial incurrence of (or
commitment in respect of) such Indebtedness, (II) no Default shall have occurred and be continuing after giving effect thereto, (III) the Borrower shall be in
compliance with Section 6.10 on a pro forma basis as of the last day of the most recently completed Test Period after giving effect to the incurrence of any such
Indebtedness and the use of proceeds thereof, (IV) other than with respect to either Indebtedness the aggregate principal amount of which does not exceed
$50,000,000 or Indebtedness issued in exchange for the IAC 2012 Senior Notes in connection with the Match Transactions, the maturity date of such Indebtedness
shall be no earlier than the later of (x) 90 days following the Revolving Termination Date and (y) 90 days after the scheduled final maturity date of any then
outstanding Term Loans, Latest Maturity Date then in effect and such Indebtedness shall not require any mandatory prepayments other than Permitted Mandatory
Prepayments, (V) such Indebtedness (w) shall not require scheduled amortization payments (excluding the final installment thereof) in excess of 1.00% per annum of
the original aggregate principal amount thereof, (x) shall not have a Weighted Average Life to Maturity that is shorter than the then longest remaining Weighted
Average Life to Maturity of any then outstanding Term Loans, (y) shall have no financial maintenance covenants of a different type than those set forth in Section
6.10, and no financial maintenance covenants that are more restrictive than those set forth in Section 6.10, and (z) does not have negative covenants and/or default
provisions that, taken as a whole, are materially more restrictive than those applicable to this Agreement as determined in good faith by the Borrower unless, in each
case of clauses (y) and (z) such terms become applicable only after the Revolving Facility shall have matured or been terminated and any Term Loans existing at such
date have been paid in full and (VI) such Indebtedness shall not be guaranteed by any subsidiaries of the Borrower other than Guarantees by the Guarantors that by
their terms are subordinated in right of payment to the Obligations; provided that the Escrow Assumption with respect to any Escrow Permitted Ratio Debt shall not
be permitted unless on the date thereof (after giving effect thereto) the conditions set forth above would be satisfied if the Borrower was borrowing such Permitted
Ratio Debt on the date of such Escrow Assumption; provided further , any Escrow Permitted Ratio Debt shall not constitute Permitted Unsecured Ratio Debt until the
Escrow Assumption with respect thereto shall have occurred.
“ person ” and “ group ” have the meanings given to them for purposes of Section 13(d) and 14(d) of the Exchange Act or any successor provisions, and the
term “group” includes any group acting for the purpose of acquiring, holding or disposing of securities within the meaning of rule 13d-5(b)(1) under the Exchange
Act, or any successor provision.
“ Person ” means any individual, corporation, partnership, limited liability company, joint venture, incorporated or unincorporated association, joint-stock
company, trust, unincorporated organization or government or other agency or political subdivision thereof or other entity of any kind.
“ Plan ” means an employee pension benefit plan as defined in Section 3(2) of ERISA (other than a Multiemployer Plan), subject to the provisions of Section
302 and Title IV of ERISA or Section 412 of the Code,
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and in respect of which the Borrower or any ERISA Affiliate is (or if such plan were terminated, would under Section 4062 or 4069 of ERISA be deemed to be) an
“employer” as defined in Section 3(5) of ERISA.
“Platform” has the meaning assigned to such term in Section 9.18.
“ Pledge Agreement ” means the Pledge Agreement by the Borrower and the Subsidiary Guarantors and during the Shared Collateral Period (if any), the
members of the IAC Group , substantially in the form of Exhibit D .
“ Pre-IPO Note ” means any intercompany debt (i) owed by the Borrower to any member of the IAC Group, (ii) incurred within 30 days prior to the Match
Offering, (iii) having a maturity not in excess of 30 days, (iv) that by its terms is subordinated in right of payment to the obligations under the Senior Secured Credit
Facilities, and (v) that is designated as such by the Borrower.
“ Preferred Stock ” means, with respect to any Person, any and all preferred or preference stock or other equity interests (however designated) of such Person
whether now outstanding or issued after the Closing Date.
“ Pricing Grid ” means the table below:
Consolidated Net Leverage Ratio
Commitment Fee Rate
Applicable Rate for
Eurocurrency Loans
Applicable Rate for
ABR Loans
>4.00:1.00
< 4.00:1.00 but >3.00:1.00
< 3.00:1.00 but >2.00:1.00
< 2.00:1.00
0.40%
0.35%
0.30%
0.25%
2.25%
2.00%
1.75%
1.50%
1.25%
1.00%
0.75%
0.50%
For the purposes of the Pricing Grid, changes in the Applicable Rate and Commitment Fee Rate resulting from changes in the Consolidated Net Leverage Ratio shall
become effective on the date (the “ Adjustment Date ”) on which financial statements are delivered to the Lenders pursuant to Section 5.01 and shall remain in effect
until the next change to be effected pursuant to this paragraph. Notwithstanding the foregoing, if any financial statements referred to above are not delivered within
the time periods specified in Section 5.01, then, until the date on which such financial statements are delivered, the highest rate set forth in each column of the Pricing
Grid shall apply. In addition, at all times while an Event of Default shall have occurred and be continuing, the highest rate set forth in each column of the Pricing Grid
shall apply. Each determination of the Consolidated Net Leverage Ratio pursuant to the Pricing Grid shall be made in a manner consistent with the determination
thereof pursuant to Section 6.10.
“ Prime Rate ” means the rate of interest per annum publicly announced from time to time by JPMorgan Chase Bank, N.A. as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective.
“Princeton Review Group” means the line of business operated by TPR Education Offshore Holdings LLC and its subsidiaries as of the Term B-1 Effective
Date as reasonably determined by the Borrower.
“ Pro Rata Extension Offer ” has the meaning assigned to such term in Section 2.19(a).
“Public Lender” has the meaning assigned to such term in Section 9.18.
“ Purchase Offer ” has the meaning assigned to such term in Section 2.21(a).
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“ Qualified Equity Interests ” of any Person means Equity Interests of such Person other than Disqualified Equity Interests. Unless otherwise specified,
Qualified Equity Interests refer to Qualified Equity Interests of the Borrower.
“ Quotation Day ” means, with respect to any Eurocurrency Borrowing for any Interest Period, (i) if the currency is Sterling, Australian Dollars or Canadian
Dollars, the first day of such Interest Period, (ii) if the currency is Euro, two TARGET2 Days before the first day of such Interest Period, (iii) for any other currency,
two Business Days prior to the commencement of such Interest Period (unless, in each case, market practice differs in the relevant market where the Eurocurrency
Rate for such currency is to be determined, in which case the Quotation Day will be determined by the Administrative Agent in accordance with market practice in
such market (and if quotations would normally be given on more than one day, then the Quotation Day will be the last of those days)).
“Recovery Event” means any event that gives rise to the receipt by the Borrower or any of its Subsidiaries of any insurance proceeds or condemnation
awards in respect of any equipment, fixed assets or real property (including any improvements thereon).
“ Reference Bank Rate ” means the arithmetic mean of the rates (rounded upwards to four decimal places) supplied to the Administrative Agent at its request
by the Reference Banks (as the case may be) as of the Specified Time on the Quotation Day for Loans in the applicable currency and the applicable Interest Period:
(a) in relation to Loans in Australian Dollars, as the bid rate observed by the relevant Reference Bank for Australian Dollars denominated bank
accepted bills and negotiable certificates of deposit issued by banks which are for the time being designated “Prime Banks” by the Australian Financial
Markets Association that have a remaining maturity equal to the relevant Interest Period;
(b) in relation to Loans in Canadian Dollars, as the rate at which the relevant Reference Bank is willing to extend credit by the purchase of
bankers acceptances which have been accepted by banks which are for the time being customarily regarded as being of appropriate credit standing for such
purpose with a term to maturity equal to the relevant period; and
(c) in relation to Loans in any currency other than AUD, CAD and Euros, as the rate at which the relevant Reference Bank could borrow funds in
the London interbank market in the relevant currency and for the relevant period, were it to do so by asking for and then accepting interbank offers in
reasonable market size in that currency and for that period; and
provided , that if any Reference Bank Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement
“ Reference Banks ” means such banks as may be selected by the Administrative Agent (subject to consent by each such Reference Bank) and are reasonably
acceptable to the Borrower.
“ refinance ” means, in respect of any Indebtedness, to refinance, extend, renew, refund, repay, prepay, or to issue other Indebtedness in exchange or
replacement for, such Indebtedness.
“ Refinanced Indebtedness ” has the meaning assigned to such term in the definition of “Refinancing Indebtedness.”
“ Refinancing Amendment ” has the meaning assigned to such term in Section 2.20(e).
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“ Refinancing Effective Date ” has the meaning assigned to such term in Section 2.20(a).
“ Refinancing Indebtedness ” means Indebtedness of the Borrower or a Restricted Subsidiary incurred in exchange for, or the proceeds of which are used to
redeem or refinance in whole or in part, any Indebtedness of the Borrower or any Restricted Subsidiary (the “ Refinanced Indebtedness ”); provided that:
(a) the principal amount (and accreted value, in the case of Indebtedness issued at a discount) of the Refinancing Indebtedness does not exceed the
principal amount (and accreted value, as the case may be) of the Refinanced Indebtedness plus the amount of accrued and unpaid interest on the Refinanced
Indebtedness, any premium paid to the holders of the Refinanced Indebtedness and expenses incurred in connection with the incurrence of the Refinancing
Indebtedness;
(b) the obligor of Refinancing Indebtedness does not include any Person (other than the Borrower or any Restricted Subsidiary) that is not an
obligor of the Refinanced Indebtedness;
(c) if the Refinanced Indebtedness was by its terms subordinated in right of payment to the Loans or the Guarantee Agreement, as the case may
be, then such Refinancing Indebtedness, by its terms, is subordinate in right of payment to the Loans or the Guarantee Agreement, as the case may be, at
least to the same extent as the Refinanced Indebtedness;
(d) the Refinancing Indebtedness has a final stated maturity either (a) no earlier than the Refinanced Indebtedness being redeemed or refinanced
or (b) after the date that is 90 days after the last maturity date applicable to the Loans at the time the Refinancing Indebtedness is incurred; and
(e) the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or prior to the last maturity date applicable to the Loans at
the time the Refinancing Indebtedness is incurred has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is incurred that is
equal to or greater than the Weighted Average Life to Maturity of the portion of the Refinanced Indebtedness being redeemed or refinanced that is scheduled
to mature on or prior to the last maturity date applicable to the Loans at the time the Refinancing Indebtedness is incurred ( provided that Refinancing
Indebtedness in respect of Refinanced Indebtedness that has no amortization may provide for amortization installments, sinking fund payments, senior
maturity dates or other required payments of principal of up to 1% of the aggregate principal amount per annum).
“ Refinancing Term Loans ” has the meaning assigned to such term in Section 2.20(a).
“ Register ” has the meaning assigned to such term in Section 9.05(b)(iv).
“ Related Business ” means any business in which the Borrower or any Restricted Subsidiary was engaged on the Closing Date or any reasonable extension
of such business and any business related, ancillary or complementary to any business of the Borrower or any Restricted Subsidiary in which the Borrower or any
Restricted Subsidiary was engaged on the Closing Date or any reasonable extension of such business.
“ Related Parties ” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors
of such Person and such Person’s Affiliates.
“ Reorganization ” means, with respect to any Multiemployer Plan, the condition that such plan is in reorganization within the meaning of Section 4241 of
ERISA.
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“ Replacement Revolving Facilities ” has the meaning assigned to such term in Section 2.20(c).
“ Replacement Revolving Facility Commitments ” has the meaning assigned to such term in Section 2.20(c).
“ Replacement Revolving Facility Effective Date ” has the meaning assigned to such term in Section 2.20(c).
“ Replacement Revolving Loans ” has the meaning assigned to such term in Section 2.20(c).
“Repricing Event” means (i) any prepayment or repayment of Term B-1 Loans with the proceeds of, or conversion of all or any portion of the Term B-1
Loans into, any new or replacement term loans bearing interest with an All-in Yield less than the All-in Yield applicable to the Term B-1 Loans subject to such event
(as such comparative yields are determined by the Administrative Agent); provided that in no event shall any prepayment or repayment of Term B-1 Loans in
connection with a Change of Control constitute a Repricing Event and (ii) any amendment to this Agreement which reduces the All-in Yield applicable to the Term B-
1 Loans (it being understood that any prepayment premium with respect to a Repricing Event shall apply to any required assignment by a Non-Consenting Lender in
connection with any such amendment pursuant to Section 2.16(c)).
“ Required Lenders ” means, at any time, Lenders having Term Loans and Revolving Commitments (or, if the Revolving Commitments have terminated,
Total Revolving Exposure outstanding) that, taken together, represent more than 50% of the sum of (x) all Term Loans and (y) all Revolving Commitments (or, if the
Revolving Commitments have terminated, Total Revolving Exposure outstanding) at such time; provided , that the Term Loans, Revolving Commitments and Total
Revolving Exposure of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.
“Required Percentage” means, with respect to any Excess Cash Flow Period, 75%; provided, that, if the Secured Net Leverage Ratio as of the end of such
Excess Cash Flow Period is (x) less than or equal to 2.25 to 1.00 but greater than 2.00 to 1.00, such percentage shall be 50%, (y) less than or equal to 2.00 to 1.00 but
greater than 1.50 to 1.00, such percentage shall be 25% or (z) less than or equal to 1.50 to 1.00, such percentage shall be 0%.
“ Required Revolving Lenders ” means, at any time, Revolving Lenders having Revolving Commitments (or if the Revolving Commitments have
terminated, Total Revolving Exposure outstanding) that, taken together, represent more than 50% of the sum of all Revolving Commitments (or, if the Revolving
Commitments have terminated, Total Revolving Exposure outstanding at such time; provided , that the Revolving Commitments and Total Revolving Exposure
outstanding of any Defaulting Lender shall be disregarded in determining Required Revolving Lenders at any time.
“ Requirements of Law ” means, as to any Person, the Certificate of Incorporation and By‑Laws or other organizational or governing documents of such
Person, and any law, treaty, rule, regulation or official administrative pronouncement or determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.
“ Restricted Payment ” means (a) any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in the
Borrower or any Restricted Subsidiary, (b) any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of
the purchase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests of the Borrower or any option, warrant or other right to
acquire any such Equity Interests or (c) any Junior Debt Restricted Payment.
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“ Restricted Subsidiary ” means any subsidiary of the Borrower other than Unrestricted Subsidiaries.
“Retained Excess Cash Flow Amount” means, as at any date of determination, an amount determined on a cumulative basis equal to, without duplication, (a)
the cumulative amount of Excess Cash Flow for all Excess Cash Flow Periods completed prior to such date, plus (b) the cumulative amount of all Declined
Prepayment Amounts, plus (c) following the date of the Match Offering, the net cash proceeds of any sale of Qualified Equity Interests by, or capital contribution to
the common equity of, the Borrower, minus (d) the amount of such Excess Cash Flow required to be applied to prepay the Loans pursuant to Section 2.08(d) during or
with respect to such applicable Excess Cash Flow Periods (without giving effect to any reduction in respect of prepayments of Indebtedness as provided in clauses (ii)
(a) and (b) thereof), minus (e) the cumulative amount of Restricted Payments made with Retained Excess Cash Flow from and after the Term B-1 Effective Date and
on or prior to such time, minus (f) the cumulative amount of Investments made with Retained Excess Cash Flow from and after the Term B-1 Effective Date and on or
prior to such time (net of any dividends, distributions, profits, returns or similar amounts in respect of any such Investments).
“ Revocation ” has the meaning assigned to such term in the definition of “Unrestricted Subsidiary.”
“ Revolving Commitment ” means, as to any Revolving Lender, the obligation of such Revolving Lender to make Revolving Loans and purchase
participation interests in Letters of Credit in an aggregate principal amount not to exceed the amount set forth under the heading “Revolving Commitment” opposite
such Lender’s name on Schedule 1.01A or in the Assignment and Assumption or Incremental Assumption Agreement pursuant to which such Revolving Lender
became a party hereto, as the same may be changed from time to time pursuant to the terms of this Agreement (including as increased, extended or replaced as
provided in Section 2.02, 2.19 and 2.20). The original aggregate Dollar Amount of all Revolving Commitments is $500,000,000.
“ Revolving Commitment Percentage ” means, with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Revolving
Commitment at such time to the Total Revolving Commitments at such time.
“ Revolving Commitment Period ” means the period from and including the Closing Date to the Revolving Termination Date.
“ Revolving Facility ” means the credit facility constituted by the Revolving Commitments and the extensions of credit thereunder.
“ Revolving Fee Payment Date ” means (a) the third Business Day following the last day of each March, June, September and December during the
Revolving Commitment Period and (b) the last day of the Revolving Commitment Period.
“ Revolving Lender ” means each Lender that has a Revolving Commitment or that holds Revolving Loans.
“ Revolving Loans ” has the meaning assigned to such term in Section 2.01(a).
“ Revolving Termination Date ” means the fifth anniversary of the Closing Date.
“ Sanctioned Country ” means, at any time, a country, region or territory which is itself the subject or target of any Sanctions (at the time of this Agreement,
Crimea, Cuba, Iran, North Korea, Sudan and Syria).
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“ Sanctioned Person ” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign
Assets Control of the U.S. Department of the Treasury, the U.S. Department of State, the United Nations Security Council or the European Union or Her Majesty’s
Treasury, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person or Persons described in
the foregoing clauses (a) or (b).
“ Sanctions ” means all economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government,
including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State or (b) the United
Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom.
“ Screen Rate ” means the LIBOR Screen Rate and the Local Screen Rates collectively and individually as the context may require.
“ SEC ” means the Securities and Exchange Commission or any successor thereto.
“ Secured Net Leverage Ratio ” means, as of any date of determination, the ratio of (i) Indebtedness of the Borrower and its Restricted Subsidiaries secured
by a Lien on any assets of the Borrower and its Restricted Subsidiaries as of the last day of the Test Period most recently ended on or prior to such date of
determination (as set forth on the balance sheet and determined on a consolidated basis in accordance with GAAP but excluding, on and prior to the Separation Date,
Indebtedness consisting of guarantees by any one or more members the Match Group of Indebtedness of any one or more members of the IAC Group ) minus the
amount of unrestricted cash and Cash Equivalents of the Borrower and its Restricted Subsidiaries on such date in an amount not to exceed (x) prior to the Term B-1
Loan Repayment Date, $100,000,000 and (y) on or after the Term B-1 Loan Repayment Date, $200,000,000 to (ii) Consolidated EBITDA for such Test Period.
(A) The Secured Net Leverage Ratio shall be calculated for any period after giving effect on a pro forma basis (as if they had occurred on the first day of
the applicable Test Period) to:
(1) the incurrence of any Indebtedness of the Borrower or any Restricted Subsidiary (and the application of the proceeds thereof) and any
repayment, repurchase, defeasance or other discharge of Indebtedness (and the application of the proceeds therefrom) (other than the incurrence or
repayment of Indebtedness in the ordinary course of business for working capital purposes pursuant to any revolving credit arrangement) occurring during
the applicable Test Period or at any time subsequent to the last day of such Test Period and on or prior to the date of determination, as if such incurrence,
repayment, issuance or redemption, as the case may be (and the application of the proceeds thereof), occurred on the first day of the Test Period;
(2) any (w) Asset Sale, (x) asset sale if the Fair Market Value of the assets sold in such transaction or series of related transactions exceeds
$2,000,000, which is solely excluded from the definition of Asset Sale pursuant to clause (7) of such definition ), (y) Asset Acquisition (including, without
limitation, any Asset Acquisition giving rise to the need to make such calculation as a result of the Borrower or any Restricted Subsidiary (including any
Person who becomes a Restricted Subsidiary as a result of such Asset Acquisition or as a result of a Revocation)) incurring Acquired Indebtedness and also
including any Consolidated EBITDA associated with any such Asset Acquisition) or (z) operational restructuring (each a “ pro forma event ”) (including any
cost savings and synergies resulting from head count reduction, closure of facilities and similar operational and other cost savings and synergies relating to
such pro forma event occurring within 12 months (or expected, in the good faith determination of the
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Borrower, to occur within 12 months) of such pro forma event and during such period or subsequent to such period and on or prior to the date of such
calculation, in each case that are expected to have a continuing impact and are factually supportable, and which adjustments the Borrower determines are
reasonable as set forth in an Officer’s Certificate; provided that the aggregate amount of all such cost savings and synergies pursuant to this clause (A)(2) and
the second paragraph of the definition of “Consolidated EBITDA” shall in no event exceed 10% of Consolidated EBITDA for such period calculated prior to
giving effect to such pro forma adjustments) occurring during the Test Period or at any time subsequent to the last day of the Test Period and on or prior to
the date of determination, as if such pro forma event occurred on the first day of the Test Period and; provided , further , that asset sales described in clause
(A)(2)(x) in an aggregate amount not to exceed $50,000,000 in any Test Period shall not be required to be given pro forma effect; and
(B) in calculating Consolidated Interest Expense for purposes of the Secured Net Leverage Ratio with respect to any Indebtedness being given pro forma
effect:
(1) interest on outstanding Indebtedness determined on a fluctuating basis as of the date of determination and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such Indebtedness in effect on the date of
determination;
(2) if interest on any Indebtedness actually incurred on the date of determination may optionally be determined at an interest rate based upon a
factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rates, then the interest rate in effect on the date of determination will be
deemed to have been in effect during the Test Period;
(3) notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a fluctuating basis, to the extent such interest is covered by
agreements relating to Hedging Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of the agreements
governing such Hedging Obligations;
(4) interest on any Indebtedness under a revolving credit facility shall be computed based upon the average daily balance of such Indebtedness
during the Test Period; and
(5) interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a responsible financial or
accounting Officer of the Borrower to be the rate of interest implicit in such Capital Lease Obligation in accordance with GAAP.
“ Secured Parties ” has the meaning assigned to such term in the Pledge Agreement.
“ Separation Date ” means the date on which the Borrower is designated as an Unrestricted Subsidiary under and in accordance with the IAC Credit
Agreement and each of the indentures governing the IAC Senior Notes, as applicable, in connection with the Match Transactions.
“ Shared Collateral Period ” means the period, if any, beginning on the 60th day following the Closing Date (as such date may be extended by up to 30 days
at the written request of the Borrower with the written consent of the Administrative Agent (not to be unreasonably withheld or delayed)) (if the Separation Date has
not occurred on or prior to such date) and ending on the Separation Date. Senior Notes” means the up to $500,000,000 aggregate principal amount of 6.75% Senior
Notes due 2022 issued by the Borrower in connection with the offer to exchange
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any and all outstanding IAC 2012 Senior Notes launched on October 16, 2015, and any exchange notes related thereto.
“ Specified Swap Agreement ” means any Swap Agreement in respect of interest rates or currency exchange rates entered into by the Borrower or any
Subsidiary Guarantor and any Person that (i) at the time such Swap Agreement is entered into is a Lender or an Agent Party or an Affiliate of a Lender or an Agent
Party or (ii) in the case of any such Swap Agreement in effect on or prior to the Closing Date, is, as of the Closing Date, a Lender or an Agent Party or an Affiliate of
a Lender or an Agent Party, unless, when entered into, such Swap Agreement is designated in writing by the Borrower and such Lender or Agent Party or Affiliate of
a Lender or Agent Party to the Administrative Agent to not be included as a Specified Swap Agreement.
“Specified Time” means approximately 11:00 a.m., London time.
“ Standard & Poor’s ” means Standard & Poor’s Rating Services a division of The McGraw-Hill Companies, Inc.
“ Sterling ” and “ £ ” mean the lawful currency of the United Kingdom.
“ subsidiary ” means, with respect to any Person (the “ parent ”):
(1) any corporation, limited liability company, association or other business entity of which more than 50% of the total voting power of the Equity
Interests entitled (without regard to the occurrence of any contingency) to vote in the election of the board of directors thereof is at the time owned or
controlled, directly or indirectly, by such Person or one or more of the other subsidiaries of such Person (or a combination thereof); and
(2) any partnership (a) the sole general partner or the managing general partner of which is such Person or a subsidiary of such Person or (b) the
only general partners of which are such Person or one or more subsidiaries of such Person (or any combination thereof).
“ Subsidiary Guarantor ” means each Domestic Subsidiary that is a party to the Guarantee Agreement; provided that no Excluded Subsidiary shall be
required to be a Subsidiary Guarantor of any obligations under this Agreement.
“ Swap Agreement ” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of
economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that no phantom stock or similar plan
providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Borrower or the Restricted
Subsidiaries shall be a Swap Agreement.
“ Swap Obligation ” means, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a
“swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.
“ Syndication Agent ” means Bank of America, N.A..
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“ TARGET2 Day ” means any day on which the Trans-European Automated Real-time Gross Settlement Express Transfer ( TARGET2 ) payment system
(or, if such payment system ceases to be operative, such other payment system reasonably determined by the Administrative Agent to be a suitable replacement) is
open for the settlement of payments in Euro.
“ Taxes ” means all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority, including
any interest, additions to tax or penalties applicable thereto.
“ Term B-1 Commitment” means, as to any Term B-1 Lender, the obligation of such Term B-1 Lender to make Term B-1 Loans in an aggregate principal
amount not to exceed the amount set forth opposite such Lender’s name on Schedule I of the Incremental Assumption Agreement No. 1 or in the Assignment and
Assumption or Incremental Assumption Agreement pursuant to which such Term B-1 Lender became a party hereto as the same may be changed from time to time
pursuant to the terms of this Agreement (including as increased, extended or replaced as provided in Section 2.02, 2.19 and 2.20). The original aggregate amount of all
Term B-1 Commitments is $800,000,000.
“Term B-1 Effective Date” has the meaning assigned to such term in the Incremental Assumption Agreement No. 1.
“Term B-1 Facility” means the credit facility constituted by the Term B-1 Commitments and the Term B-1 Loans thereunder.
“Term B-1 Lender” means each Lender that has a Term B-1 Commitment or that holds Term B-1 Loans.
“Term B-1 Loan Repayment Date” means the date on which all Term B-1 Loans are no longer outstanding.
“Term B-1 Loans” means the Term Loans made pursuant to the Term B-1 Commitment.
“Term B-1 Maturity Date” means the date that is seven years from the Term B-1 Effective Date; provided that, if any Senior Notes remain outstanding on the
date that is 91 days prior to the maturity date of the Senior Notes, the Term B-1 Maturity Date shall be the date that is 91 days prior to the maturity date of the Senior
Notes.
“Term Facility ” means a credit facility in respect of Term Loans hereunder including the Term B-1 Facility.
“Term Lender” means each Lender that holds Term Loans .
“ Term Loan Commitment ” means any Commitment in respect of Term Loans including the Term B-1 Commitments .
“ Term Loan Standstill Period ” has the meaning assigned to such term in Section 7.01(d).
“ Term Loans ” means the Term B-1 Loans, any Incremental Term Loan, Extended Term Loan or Refinancing Term Loans incurred hereunder; provided that
no Escrow Incremental Term Loan shall be deemed to be a Term Loan outstanding hereunder until the Escrow Assumption with respect thereto shall have occurred.
“ Test Period ” means the four consecutive fiscal quarter period most recently ended; provided that, prior to the first date that financial statements shall have
been delivered pursuant to Section 5.01, the Test Period in effect shall be the period of four consecutive fiscal quarters of the Borrower ended June 30, 2015. A Test
Period may be designated by reference to the last day thereof (i.e. the June 30, 2015 Test Period refers to the period of four
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consecutive fiscal quarters of the Borrower ended June 30, 2015), and a Test Period shall be deemed to end on the last day thereof.
“ Total Assets ” means, as of any date of determination, the total assets of the Borrower and its Restricted Subsidiaries, determined on a consolidated basis in
accordance with GAAP, as set forth on the most recent consolidated balance sheet of the Borrower as of such date (which calculation shall give pro forma effect to
any acquisition or asset sale by the Borrower or any of its Restricted Subsidiaries, in each case involving the payment or receipt by the Borrower or any of its
Restricted Subsidiaries of consideration (whether in the form of cash or non-cash consideration) in excess of $50,000,000 that has occurred since the date of such
consolidated balance sheet, as if such acquisition or Asset Sale had occurred on the last day of the fiscal period covered by such balance sheet).
“ Total Percentage ” means, with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such time
to the Aggregate Exposure of all Lenders at such time.
“ Total Revolving Commitments ” means, at any time, the aggregate principal amount of the Revolving Commitments then in effect.
“ Total Revolving Exposure ” means, at any time, the sum of the Total Revolving Loans and LC Exposure outstanding at such time.
“ Total Revolving Loans ” means, at any time, the aggregate principal amount of the Revolving Loans of the Revolving Lenders outstanding at such time.
“ Transactions ” means the execution, delivery and performance by the Borrower of this Agreement, the execution, delivery and performance by the Loan
Parties of the other Loan Documents, the borrowing of Loans and the use of proceeds thereof.
“Tutor.com Group” means the line of business operated by Tutor.com, Inc. and its subsidiaries as of the Term B-1 Effective Date as reasonably determined
by the Borrower.
“ Type ” means, as to any Loan, its nature as an ABR Loan or a Eurocurrency Loan.
“ Unrestricted Subsidiary ” means (a) any subsidiary of the Borrower listed on Schedule 1.01B, (b) any subsidiary of the Borrower that is designated as an
Unrestricted Subsidiary by the Borrower after the Closing Date in a written notice to the Administrative Agent and (c) any subsidiary of any subsidiary described in
clause (a) or (b) above; provided that (i) no Default shall have occurred and be continuing at the time of or after giving effect to the designation of a subsidiary as an
Unrestricted Subsidiary (a “ Designation ”) and (ii) at the time of and immediately after giving effect to such Designation, the Borrower shall be in compliance with
Section 6.10; provided , further , that no subsidiary shall be designated as an Unrestricted Subsidiary unless (w) no creditor of such subsidiary shall have any claim
(whether pursuant to a Guarantee or otherwise) against the Borrower or any of its Restricted Subsidiaries in respect of any Indebtedness or other obligation (except for
obligations arising by operation of law, including joint and several liability for taxes, ERISA and similar items) of such subsidiary (collectively, “ Unrestricted
Subsidiary Support Obligations ”), except pursuant to Investments which are made in accordance with Section 6.11; (x) such subsidiary is not party to any transaction
with the Borrower or any Restricted Subsidiary unless the terms of such transaction complies with Section 6.06 and (y) no Investments may be made in any such
subsidiary by the Borrower or any Restricted Subsidiary except to the extent permitted under Section 6.11 other than Section 6.11(e) (it being understood that, if a
subsidiary is designated as an Unrestricted Subsidiary after the Closing Date, the aggregate Fair Market Value of all outstanding Investments owned by the Borrower
and its Restricted
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Subsidiaries in the subsidiary so designated shall be deemed to be an Investment made as of the time of such designation and shall be subject to the limits set forth in
Section 6.11 (other than Section 6.11(e))). It is understood that Unrestricted Subsidiaries shall be disregarded for the purposes of any calculation pursuant to this
Agreement relating to financial matters with respect to the Borrower.
The Borrower may revoke the designation of a subsidiary as an Unrestricted Subsidiary pursuant to a written notice to the Administrative Agent so long as,
after giving pro forma effect to such revocation, (i) (x) the Consolidated Net Leverage Ratio shall be less than or equal to the Consolidated Net Leverage Ratio and (y)
the Interest Coverage Ratio shall be equal to or higher than the Interest Coverage Ratio, in each case, then required to be maintained by the Borrower pursuant to
Section 6.10 and (ii) no Default shall be in existence( a “ Revocation ”). Upon any Revocation, such Unrestricted Subsidiary shall constitute a Restricted Subsidiary
for all purposes of this Agreement and the Borrower shall comply with Section 5.09 if such subsidiary is a Material Domestic Subsidiary. In the case of any
Revocation, if the designation of such subsidiary as an Unrestricted Subsidiary caused the available basket amount referred to in Section 6.11 (other than Section
6.11(e)) to be utilized by an amount equal to the aggregate Fair Market Value of all outstanding Investments owned by the Borrower and its Restricted Subsidiaries in
the subsidiary so designated (the amount so utilized, the “ Designation Amount ”), then, effective upon such Revocation, such available basket amount shall be
increased by the lesser of (i) the Designation Amount and (ii) the aggregate Fair Market Value of all outstanding Investments owned by the Borrower and its
Restricted Subsidiaries in such subsidiary at the time of such Revocation.
“ Unrestricted Subsidiary Support Obligations ” has the meaning assigned to such term in the definition of “Unrestricted Subsidiary.”
“ U.S. Lender ” means any Lender that is a “United States person” within the meaning of Section 7701(a)(30) of the Code.
“ U.S. Tax Compliance Certificate ” has the meaning assigned to such term in Section 2.14(e)(ii)(B)(3).
“ Voting Stock ” means the stock of the class or classes pursuant to which the holders thereof have the general voting power under ordinary circumstances to
elect at least a majority of the Board of Directors of the Borrower (irrespective of whether or not at the time stock of any other class or classes shall have or might
have voting power by reason of the happening of any contingency).
“ Weighted Average Life to Maturity ” when applied to any Indebtedness at any date, means 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 payment of principal, including
payment at final maturity, in respect thereof by (ii) the number of years (calculated to the nearest one-twelfth) that shall elapse between such date and the making of
such payment by (b) the then outstanding principal amount of such Indebtedness.
“ Wholly Owned Subsidiary ” means a subsidiary of which 100% of the Equity Interests (except for directors’ qualifying shares or certain minority interests
owned by other Persons solely due to local law requirements that there be more than one stockholder, but which interest is not in excess of what is required for such
purpose) are owned directly by the Borrower or through one or more Wholly Owned Subsidiaries and, solely for the purpose of the definition of “Material Domestic
Subsidiary,” excluding any subsidiary whose sole assets are Equity Interests in one or more subsidiaries that are not Wholly Owned Subsidiaries.
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“ Withdrawal Liability ” means 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.
“ Yen ” and “ ¥ ” mean the lawful currency of Japan.
SECTION 1.02 Classification of Loans and Borrowings . For purposes of this Agreement, Loans may be classified and referred to by Class ( e.g ., a
“Revolving Loan”) or by Type ( e.g ., a “Eurocurrency Loan”) or by Class and Type ( e.g ., a “Eurocurrency Revolving Loan”). Borrowings also may be classified
and referred to by Class ( e.g ., a “Revolving Borrowing”) or by Type ( e.g ., a “Eurocurrency Borrowing”) or by Class and Type ( e.g ., a “Eurocurrency Revolving
Borrowing”).
SECTION 1.03 Terms Generally . The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be
deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the
context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement,
instrument or other document as from time to time amended, supplemented, restated, amended and restated, extended or otherwise modified (subject to any
restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such Person’s
successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and
not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and
Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities, accounts and contract rights. The foregoing standards shall also apply to the other Loan
Documents.
SECTION 1.04 Accounting Terms; GAAP . Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided that for purposes of any determinations associated with leases, including, without
limitation, determinations of whether such leases are capital leases, whether obligations under such leases are Capital Lease Obligations, the amount of any Capital
Lease Obligations associated with such leases, and the amount of operating expenses associated with such leases, Consolidated EBITDA, Consolidated Interest
Expense, Indebtedness, the Consolidated Net Leverage Ratio, the Secured Net Leverage Ratio and the Interest Coverage Ratio shall be determined based on generally
accepted accounting principles in the United States of America in effect on the Closing Date; provided , further , that, if the Borrower notifies the Administrative
Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Closing Date in GAAP or in the
application thereof 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, 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.
SECTION 1.05 Change of Currency . Each provision of this Agreement also shall be subject to such reasonable changes of construction as the
Administrative Agent may from time to time specify after consultation with the Borrower to be appropriate to the extent necessary to reflect a change in currency of
any country and any relevant market conventions or practices relating to such change in currency.
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SECTION 1.06 Currency Equivalents Generally .
(a) Unless the context otherwise requires, any amount specified in this Agreement to be in Dollars shall also include the Dollar Amount of any Alternative
Currency. The maximum amount of Indebtedness and other threshold amounts that the Borrower and its Restricted Subsidiaries may incur under Article VI shall not
be deemed to be exceeded, with respect to any outstanding Indebtedness and other threshold amounts solely as a result of fluctuations in the exchange rate of
currencies. When calculating capacity for the incurrence of additional Indebtedness and other threshold amounts by the Borrower and any Restricted Subsidiary, the
exchange rate of currencies shall be measured as of the date of such calculation.
(b) (i) The Administrative Agent shall determine the Dollar Amount of any Letter of Credit denominated in an Alternative Currency as of the date of the
issuance thereof and on the first Business Day of each calendar month on which such Letter of Credit is outstanding, in each case using the Exchange Rate in effect on
the date of determination, and each such amount shall be the Dollar Amount of such Letter of Credit until the next required calculation thereof pursuant to this
Section. The Administrative Agent shall in addition determine the Dollar Amount of any Letter of Credit denominated in an Alternative Currency as provided in
Sections 2.17(e) and 2.17(l).
(ii) The Administrative Agent shall determine the Dollar Amount of any Borrowing denominated in an Alternative Currency on or about the date of the
commencement of the initial Interest Period therefor and as of the date of the commencement of each subsequent Interest Period therefor, in each case using the
Exchange Rate in effect on the date of determination, and each such amount shall, except as provided in the next sentence, be the Dollar Amount of such Borrowing
until the next required calculation thereof pursuant to this Section.
(iii) The Administrative Agent may also determine the Dollar Amount of any Borrowing or Letters of Credit denominated in an Alternative Currency as
of such other dates as the Administrative Agent shall determine, in each case using the Exchange Rate in effect on the date of determination, and each such amount
shall be the Dollar Amount of such Borrowing or Letter of Credit until the next calculation thereof pursuant to this Section.
(iv) The Administrative Agent shall notify the Borrower, the applicable Lenders and the Issuing Bank of each determination of the Dollar Amount of each
Letter of Credit, Borrowing and LC Disbursement.
(c) Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in
effect at such time; provided , however , that with respect to any Letter of Credit that, by its terms or the terms of any other document related thereto, provides for one
or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of
Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time s.
SECTION 2.01 Revolving Commitments .
ARTICLE II
The Credits
(a) Subject to the terms and conditions hereof, from time to time during the Revolving Commitment Period, each Revolving Lender severally agrees to
make to the Borrower revolving credit loans denominated in Dollars or an Alternative Currency (“ Revolving Loans ”) in an aggregate principal amount that will not
result at the time of such Borrowing in (A) the Dollar Amount of such Lender’s Outstanding Revolving Credit under the
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Revolving Commitments exceeding such Lender’s Revolving Commitment or (B) the Dollar Amount of Revolving Loans in Alternative Currencies exceeding the
Alternative Currency Revolving Sublimit. During the Revolving Commitment Period the Borrower may use the Revolving Commitments by borrowing, prepaying the
Revolving Loans in whole or in part, and reborrowing, all in accordance with the terms and conditions hereof. The Revolving Loans may from time to time be
Eurocurrency Loans or, in the case of Revolving Loans in Dollars, ABR Loans, as determined by the Borrower and notified to the Administrative Agent in accordance
with Sections 2.03 and 2.05. (b) Each Revolving Loan under the Revolving Commitments shall be made as part of a Borrowing consisting of Revolving Loans
made by the Revolving Lenders thereunder ratably in accordance with their respective Revolving Commitments. The failure of any Revolving Lender to make any
Revolving Loan required to be made by it shall not relieve any other Revolving Lender of its obligations hereunder; provided that the Revolving Commitments of the
Revolving Lenders are several and no Revolving Lender shall be responsible for any other Revolving Lender’s failure to make Revolving Loans as required. When
more than one Class of Revolving Loans exists, each Borrowing of Revolving Loans shall be made pro rata across each Class.
(b) Subject to the terms and conditions hereof and in the Incremental Assumption Agreement No. 1, each Term B-1 Lender severally agrees to make to the
Borrower Term B-1 Loans denominated in Dollars on the Term B-1 Effective Date in an amount equal to such Term B-1 Lender’s Term B-1 Commitment. Term B-1
Loans that are repaid or prepaid may not be reborrowed.
(c) At the commencement of each Interest Period for any Eurocurrency Revolving Borrowing, such Borrowing shall be in an aggregate principal amount
that is an integral multiple of $1,000,000 and not less than $5,000,000 (or comparable amounts determined by the Administrative Agent in the case of Alternative
Currency). At the time that each ABR Revolving Borrowing is made, such Borrowing shall be in an aggregate principal amount that is an integral multiple of
$1,000,000 and not less than $5,000,000; provided that an ABR Revolving Borrowing may be in an aggregate principal amount that is equal to the entire unused
balance of the Total Revolving Commitments applicable outstanding Commitment . Borrowings of more than one Type and Class may be outstanding at the same
time; provided that there shall not at any time be more than a total of 15 Eurocurrency Revolving Borrowings outstanding.
SECTION 2.02 Incremental Revolving Commitments and Incremental Term Loans .
(a) The Borrower may, by written notice to the Administrative Agent from time to time, request Incremental Term Loan Commitments and/or Incremental
Revolving Commitments, as applicable, in an amount not to exceed the Incremental Amount available at the time such Incremental Term Loans are funded or
established (if commitments in respect of such Incremental Term Loans are established on a date prior to funding) or Incremental Revolving Commitments are
established (except, in each case, as set forth in the final paragraph under Section 6.01) from one or more Incremental Term Lenders and/or Incremental Revolving
Lenders (which, in each case, may include any existing Lender (but no such Lender shall be required to participate in any such Incremental Facility without its
consent), but shall be required to be persons which would qualify as assignees of a Lender in accordance with Section 9.05) willing to provide such Incremental Term
Loans and/or Incremental Revolving Commitments, as the case may be, in their sole discretion; provided that (i) each Incremental Revolving Lender providing a
commitment to make revolving loans shall be subject to the approval of the Administrative Agent and, to the extent the same would be required for an assignment
under Section 9.05, the Issuing Bank (which approvals shall not be unreasonably withheld, conditioned or delayed) and (ii) the aggregate principal amount of
Incremental Term A Loans permitted to be incurred hereunder shall not exceed $250,000,000. Such notice shall set forth (i) the amount of the Incremental Term Loan
Commitments and/or Incremental Revolving Commitments being requested (which shall be in minimum increments of $5,000,000 and a minimum amount of
$10,000,000, or equal to the remaining
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Incremental Amount or, in each case, such lesser amount approved by the Administrative Agent), (ii) the date on which such Incremental Term Loan Commitments
and/or Incremental Revolving Commitments are requested to become effective and (iii) whether such Incremental Facility is an Incremental Term A Facility.
(b) The Borrower and each Incremental Term Lender and/or Incremental Revolving Lender shall execute and deliver to the Administrative Agent an
Incremental Assumption Agreement and such other documentation (including, without limitation, amendments to this Agreement) as the Administrative Agent shall
reasonably specify to evidence the Incremental Term Loan Commitment of such Incremental Term Lender and/or Incremental Revolving Commitment of such
Incremental Revolving Lender. Each Incremental Assumption Agreement shall specify the terms of the applicable Incremental Term Loans and/or Incremental
Revolving Commitments; provided that:
(i) any Incremental Revolving Commitments shall have the same terms as the Revolving Commitments, shall require no scheduled
amortization or mandatory commitment reduction prior to the Revolving Termination Date and shall be on the same terms and pursuant to the same
documentation applicable to the Revolving Commitments,
(ii) except with respect to any Escrow Incremental Term Loans until the assumption by the Borrower thereof, the Incremental Term Loans
shall not be guaranteed by any subsidiaries of the Borrower that do not guarantee the Obligations and shall be secured on a pari passu basis by the same
Collateral (and no additional Collateral) securing the Obligations,
(iii) the scheduled final maturity date of any Incremental Term A Facility shall be no earlier than the Revolving Termination Date and the
scheduled final maturity date of any other Incremental Term Facility shall be no earlier than the later of (x) 90 days following the Revolving Termination
Date and (y) the scheduled final maturity date of any then outstanding Term Loans,
(iv) no Incremental Facility (other than the Term B-1 Term Loans incurred on the Term B-1 Effective Date and an Incremental Term A
Facility) shall require scheduled amortization payments (excluding the final installment thereof) in excess of 1.00% per annum of the original aggregate
principal amount thereof; and
(v) any Incremental Term Facility shall be on terms (other than pricing, amortization, maturity, prepayment premiums and mandatory
prepayments) and pursuant to documentation substantially similar to the Revolving Facility or otherwise reasonably acceptable to the Administrative Agent;
provided that such Incremental Facilities (x) shall have no financial maintenance covenants of a different type than the financial covenants set forth in
Section 6.10, and no financial maintenance covenants that are more restrictive than the financial covenants set forth in Section 6.10, (y) in the case of the
first Incremental Term Facility to be incurred under this Agreement, shall not have negative covenants and/or default provisions that are more restrictive than
those applicable to the Revolving Facility and (z) in the case of each other Incremental Term Facility, 6.10 and (y) shall not have negative covenants and/or
default provisions that, taken as a whole, are materially more restrictive than those applicable to the Revolving Facility as determined in good faith by the
Borrower unless, in each case of clauses (x) , and (y) and (z) such terms (I) (if favorable to all then existing Lenders) are in consultation with the
Administrative Agent, incorporated into this Agreement for the benefit of all then existing Lenders (without further amendment requirements); (II) become
applicable only after the Revolving Facility shall have matured or been terminated and any Term Loans existing at such date have been paid in full or (III)
apply to Escrow Incremental Term Loans solely until the Escrow Assumption with respect thereto occurs ; provided, however, with respect to any
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Incremental Term Loans, the All-in Yield shall be as agreed by the respective Incremental Term Lenders and the Borrower, except that the All-in Yield in
respect of any such Incremental Term Loans may exceed the All-in Yield in respect of the Term B-1 Loans by no more than 0.50%, or if it does so exceed
such All-in Yield (such difference, the “Term Yield Differential”) then the Applicable Rate (or the “LIBOR floor” as provided in the following proviso)
applicable to such Term B-1 Loans shall be increased such that after giving effect to such increase, the Term Yield Differential shall not exceed 0.50%;
provided, that to the extent any portion of the Term Yield Differential is attributable to a higher “LIBOR floor” being applicable to such Incremental Term
Loans, such floor shall only be included in the calculation of the Term Yield Differential to the extent such floor is greater than the Adjusted LIBO Rate in
effect for an Interest Period of three months’ duration at such time, and, with respect to such excess, the “LIBOR floor” applicable to the outstanding Term
B-1 Loans shall be increased to an amount not to exceed the “LIBOR floor” applicable to such Incremental Term Loans prior to any increase in the
Applicable Rate applicable to such Term B-1 Loans then outstanding .
(c) Each party hereto hereby agrees that, upon the effectiveness of any Incremental Assumption Agreement, this Agreement shall be amended or amended
and restated to the extent (but only to the extent) necessary to reflect the existence and terms of the Incremental Term Loan Commitments and/or Incremental
Revolving Commitments evidenced thereby as provided for in Section 9.02. Any amendment or amendment and restatement to this Agreement or any other Loan
Document that is necessary to effect the provisions of this Section 2.02 (including, without limitation, to provide for the establishment of Incremental Term Loans)
and any such collateral and other documentation shall be deemed “Loan Documents” hereunder and may be memorialized in writing between the Administrative
Agent and the Borrower and furnished to the other parties hereto.
(d) The Borrower may, by written notice to the Administrative Agent from time to time, request Escrow Incremental Term Loans which shall be incurred
by an Escrow Borrower. Such notice shall set forth (i) the amount of the Escrow Incremental Term Loans being requested (which shall be in minimum increments of
$5,000,000 and a minimum amount of $10,000,000, or equal to the then remaining Incremental Amount or, in each case, such lesser amount approved by the
Administrative Agent), (ii) the date on which such Escrow Incremental Term Loans are requested to be borrowed by the Escrow Borrower and (iii) the identity of the
Escrow Borrower. The Escrow Incremental Term Loans shall be incurred by an Escrow Borrower; provided that:
(i) prior to the Escrow Assumption thereof, the Escrow Incremental Term Loans shall be incurred pursuant to and governed by loan
documentation and escrow documentation, if any, separate from this Agreement and the other Loan Documents, which such loan documentation shall
specify (A) the terms of the Escrow Assumption Agreement, (B) the terms of the Incremental Term Loans following the Escrow Assumption of such Escrow
Incremental Term Loans and (C) that following the Escrow Assumption, the lenders thereunder shall agree to be bound by this Agreement and the other
Loan Documents as permitted to be amended by Section 2.02(c) and Section 9.02 ;
(ii) unless otherwise agreed by the Administrative Agent, the administrative agent and escrow agent, if any, for such Escrow Incremental Term
Loans shall be the Administrative Agent; provided that if the Administrative Agent acts as administrative agent for such Escrow Incremental Term Loans,
the Administrative Agent in its capacity as administrative agent for such Escrow Incremental Term Loans shall receive (A) documentation and other
information requested by the Lenders that is required by regulatory authorities under applicable “know your customer” and anti-money-laundering rules and
regulations, including without limitation, the Act, in each case as requested at least three Business Days prior to the date on which such Escrow Incremental
Term Loans are requested to become effective and (B) all documents
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and legal opinions consistent with those delivered on the Closing Date as to such matters as are reasonably requested by the Administrative Agent in its
capacity as administrative agent for such Escrow Incremental Term Loans;
(iii) Escrow Incremental Term Loans shall not be deemed to be outstanding under this Agreement or any other Loan Document for any
purposes hereof (including, without limitation, for purposes of any financial calculation, the definition of “Obligations,” the definition of “Required Lenders”
or Section 7.01, 9.02 or 9.03 hereof) and the obligations with respect thereto shall not be recourse to the Borrower or any Restricted Subsidiary, in each case,
unless and until the Escrow Assumption with respect thereto shall have occurred;
(iv) at the time of the Escrow Assumption (A) the conditions specified in clauses (b) and (e) of this Section 2.02 (other than the condition in
2.02(e)(ii) with respect to complying with 4.02(c)) shall be satisfied as if the Borrower was borrowing such Escrow Incremental Term Loans on the date of
such Escrow Assumption, (B) the Incremental Term Loan Commitments and/or Incremental Revolving Commitments plus such Escrow Incremental Term
Loans then outstanding do not exceed the Incremental Amount at such time and (C) the aggregate principal amount of Incremental Term A Loans
outstanding (including, if applicable, such Escrow Incremental Term Loans) incurred on or prior to such time do not exceed $250,000,000; and
(v) following any Escrow Assumption (A) each Escrow Incremental Term Loan assumed by the Borrower shall be deemed outstanding under
this Agreement as an Incremental Term Loan, (B) each of the lenders of such Escrow Incremental Term Loan shall be deemed to be Lenders hereunder, (C)
Escrow Incremental Term Loans that were Eurocurrency Loans of a particular Borrowing shall initially be Eurocurrency Loans of a Borrowing under this
Agreement with an initial Interest Period equal to the then remaining Interest Period for such Borrowing under this Agreement (and with the same
Eurocurrency Rate) and (D) Escrow Incremental Term Loans assumed by the Borrower that were ABR Loans shall initially be ABR Loans under this
Agreement.
(e) Notwithstanding the foregoing, no Incremental Term Loan Commitment or Incremental Revolving Commitment shall become effective under this
Section 2.02 unless (i) no Default or Event of Default shall exist after giving pro forma effect to such Incremental Term Loan Commitment or Incremental Revolving
Commitment and the incurrence of Indebtedness thereunder and use of proceeds therefrom; provided , that in the event that any tranche of Incremental Facilities that
are used to finance an acquisition permitted hereunder, to the extent the Incremental Lenders participating in such Incremental Facility agree, the foregoing clause (i)
shall be tested at the time of the execution of the acquisition agreement related to such acquisition ( provided , that such Incremental Lenders shall not be permitted to
waive any Default or Event of Default then existing or existing after giving effect to such Incremental Facility); (ii) the conditions set forth in Section 4.02 have been
complied with whether or not a Borrowing is made under the Incremental Facility on such date (other than clause (c) thereof which shall only be required to be
complied with if a Borrowing is made on such date); (iii) after giving pro forma effect to such Incremental Term Loan Commitment or Incremental Revolving
Commitment and the incurrence of Indebtedness thereunder (assuming such commitments are fully drawn on such date) and use of proceeds therefrom the Borrower
would be in compliance with Section 6.10 as of the last day of the most recently ended Test Period only on the date of the initial incurrence of (or commitment in
respect of) such Indebtedness; and (iv) the Administrative Agent shall have received documents and legal opinions consistent with those delivered on the Closing
Date as to such matters as are reasonably requested by the Administrative Agent. The Administrative Agent shall promptly notify each Lender as to the effectiveness
of each Incremental Assumption Agreement.
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(f) Upon each increase in the establishment of any Incremental Revolving Commitments pursuant to this Section 2.02, each Lender immediately prior to
such increase will automatically and without further act be deemed to have assigned to each Incremental Revolving Lender providing a portion of the Incremental
Revolving Commitments in respect of such increase, and each such Incremental Revolving Lender will automatically and without further act be deemed to have
assumed, a portion of such Lender’s participations hereunder in outstanding Letters of Credit such that, after giving effect to each such deemed assignment and
assumption of participations, the percentage of the aggregate outstanding participations hereunder in Letters of Credit held by each Lender (including each such
Incremental Revolving Lender) will equal such Lender’s Revolving Commitment Percentage and if, on the date of such increase, there are any Revolving Loans
outstanding, such Revolving Loans shall on or prior to the effectiveness of such Incremental Revolving Commitments either be prepaid from the proceeds of
additional Revolving Loans made hereunder or assigned to an Incremental Revolving Lender (in each case, reflecting such Incremental Revolving Commitments,
such that Revolving Loans are held ratably in accordance with each Lender’s pro rata share, after giving effect to such increase), which prepayment or assignment
shall be accompanied by accrued interest on the Revolving Loans being prepaid. 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 the
immediately preceding sentence. If there is a new Revolving Borrowing on such Incremental Revolving Commitment Closing Date, the Revolving Lenders after
giving effect to such Incremental Revolving Commitments shall make such Revolving Loans in accordance with Section 2.01.
SECTION 2.03 Procedure for Revolving Loan Borrowing .
(a) To request a Revolving Borrowing or a Term B-1 Loan Borrowing on any Business Day, the Borrower shall notify the Administrative Agent of such
request (x) in the case of ABR Loans, by telephone (which notice must be received by the Administrative Agent prior to 12:00 noon, New York City time on the
requested Borrowing Date) or (y) in the case of Eurocurrency Loans, in writing (which notice must be received by the Administrative Agent prior to 12:00 noon, New
York City time not less than (A) three Business Days prior to the requested Borrowing Date for Dollar Revolving Borrowing requests and (B) four Business Days
prior to the requested Borrowing Date for Alternative Currency Revolving Borrowing requests). Any telephonic borrowing request shall be irrevocable and (but may
be conditioned on the occurrence of any event if the borrowing request includes a description of such event; provided that the relevant Lenders shall still be entitled to
the benefits of Section 2.13) and any telephonic borrowing request shall be confirmed promptly in writing. Each such telephonic and written borrowing request shall
specify the amount, currency and Type of Borrowing to be borrowed and the requested Borrowing Date. Upon receipt of such notice, the Administrative Agent shall
promptly notify each relevant Revolving Lender thereof. For the avoidance of doubt, subject to Section 2.11, each Borrowing shall be comprised entirely of ABR
Loans or Eurocurrency Loans as the Borrower may request in accordance herewith and all Revolving Loans made in Alternative Currencies shall be Eurocurrency
Loans.
(b) If no election as to the Type of Revolving Borrowing is specified for a Revolving Borrowing in Dollars, then the requested Revolving Borrowing shall
be an ABR Borrowing. If no Interest Period is specified with respect to any requested Eurocurrency Revolving Borrowing, then the Borrower shall be deemed to have
selected an Interest Period of one month’s duration. If no currency is specified for a Revolving Borrowing , the requested Borrowing shall be in Dollars. In making
any determination of the Dollar Amount for purposes of calculating the amount of Revolving Loans to be borrowed from the respective Lenders on any date, the
Administrative Agent shall use the relevant Exchange Rate in effect on the date on which the Borrower delivers a borrowing request for such Revolving Loans
pursuant to the provisions of Section 2.03(a).
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SECTION 2.04 Funding of Borrowings .
(a) Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds (x) in the
case of any Loan denominated in Dollars, by 3:00 p.m. New York City time and (y) in the case of any Loan denominated in an Alternative Currency, by 12:00 noon
local time in the place of settlement for such Alternative Currency, in each case to the account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in like
funds, to an account of the Borrower maintained with the Administrative Agent in New York City or to any other account as shall have been designated by the
Borrower in writing to the Administrative Agent in the applicable borrowing request. Each Lender at its option may make any Eurocurrency Loan by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower to
repay such Loan in accordance with the terms.
(b) Unless the Administrative Agent shall have received notice from a Lender prior to the proposed time of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such share available
on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the Borrower a corresponding amount. In
such event, if a Lender has not in fact made its share of the applicable Borrowing available to the Administrative Agent, then the applicable Lender and the Borrower
severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for each day from and including the date
such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the case of such Lender, a rate determined
by the Administrative Agent in accordance with banking industry rules on interbank compensation in the relevant currency or (ii) in the case of the Borrower, the
interest rate applicable to such Loans in the case of a Loan in Dollars or the applicable Eurocurrency Rate in the case of a Revolving Loan in an Alternative Currency.
If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan included in such Borrowing.
(c) The obligations of the Lenders hereunder to make Loans, to fund participations in Letters of Credit and to make payments pursuant to Sections 8.09 and
9.04(c) are several and not joint. The failure of any Lender to make any Loan or to fund any such participation or to make any payment under Sections 8.09 or 9.04(c)
on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and, other than pursuant to Section 2.18, no
Lender shall be responsible for the failure of any other Lender to so make its Loan or, to fund its participation or to make its payment under Sections 8.09 or 9.04(c).
SECTION 2.05 Interest Elections .
(a) Each Borrowing denominated in Dollars initially shall be of the Type specified in the applicable borrowing request, and each Eurocurrency Borrowing
in Dollars or an Alternative Currency shall have an initial Interest Period as specified in such borrowing request. Thereafter, the Borrower may elect to convert any
Borrowing denominated in Dollars to a different Type or to continue such Borrowing as the same Type and may elect successive Interest Periods for any
Eurocurrency Borrowing in Dollars or , in the case of Revolving Loans, an Alternative Currency, all as provided in this Section. The Borrower may elect different
Types or Interest Periods, as applicable, with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among
the relevant Lenders holding the Loans comprising the relevant portion of such Borrowing, and the Loans comprising each such portion shall be considered a separate
Borrowing.
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(b) To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by the time that a
request for a Revolving Borrowing would be required under Section 2.03, if the Borrower were requesting a Borrowing of the Type resulting from such election to be
made on the effective date of such election. Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly in writing.
(c) Each telephonic and written Interest Election Request shall specify (i) the Borrowing to which such Interest Election Request applies and, if different
options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the information to
be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing), (ii) the effective date of the election made pursuant to such
Interest Election Request, which shall be a Business Day, (iii) in the case of a Borrowing denominated in Dollars, whether the resulting Borrowing is to be an ABR
Borrowing or a Eurocurrency Borrowing, and (iv) if the resulting Borrowing is a Eurocurrency Borrowing, the Interest Period to be applicable thereto after giving
effect to such election, which shall be a period contemplated by the definition of the term “Interest Period.” If any such Interest Election Request requests a
Eurocurrency Borrowing but does not specify an Interest Period, then the Borrower shall be deemed to have selected an Interest Period of one month’s duration.
(d) Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each relevant Lender of the details thereof and of
such Lender’s portion of each resulting Borrowing.
(e) If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurocurrency Borrowing prior to the end of the Interest Period
applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be continued as such for an
Interest Period of one month. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent, at
the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Borrowing in Dollars may be
converted to or continued as a Eurocurrency Borrowing and (ii) unless repaid, each Eurocurrency Borrowing denominated in Dollars shall be converted to an ABR
Borrowing at the end of the Interest Period applicable thereto and (iii) each Eurocurrency Borrowing in an Alternative Currency shall be continued as such for an
Interest Period of not more than one month.
SECTION 2.06 Termination and Reduction of Commitments . The Borrower shall have the right, upon not less than three Business Days’ notice to the
Administrative Agent, to terminate the Revolving Commitments of any Class or, from time to time, to reduce the amount of the Revolving Commitments of any Class
; provided that no such termination or reduction of Revolving Commitments shall be permitted if, after giving effect thereto and to any prepayments of the Revolving
Loans made on the effective date thereof, the Outstanding Revolving Credits would exceed the Total Revolving Commitments. Any such reduction shall be in an
amount equal to an integral multiple of $1,000,000 and not less than $5,000,000 and shall reduce permanently the Revolving Commitments of such Class then in
effect.
SECTION 2.07 Repayment of Loans; Evidence of Debt .
(a) Any Lender may request that Loans made by it be evidenced by a promissory note. In such event, the Borrower shall prepare, execute and deliver to
such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in a form approved
by the Administrative Agent. Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to
Section 9.05) be represented by one or more promissory notes in such
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form payable to the order of the payee named therein (or, if such promissory note is a registered note, to such payee and its registered assigns).
(b) The Borrower unconditionally promises to pay the then unpaid principal amount of each Revolving Loan on the Revolving Termination Date.
(c) The Borrower shall repay principal of outstanding Term B-1 Loans on the last Business Day of each March, June, September and December of each
year (commencing on the applicable day of the first full fiscal quarter of the Borrower after the Term B-1 Effective Date) and on the Term B-1 Maturity Date, in an
aggregate principal amount of such Term B-1 Loans equal to (A) in the case of quarterly payments due prior to the Term B-1 Maturity Date, an amount equal to
1.25% of the aggregate principal amount of such Term B-1 Loans incurred on the Term B-1 Effective Date, and (B) in the case of such payment due on the Term B-1
Maturity Date, an amount equal to the then unpaid principal amount of such Term B-1 Loans outstanding.
(d) (c) Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.
(e) (d) The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the currency and Type
thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to each
Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the relevant Lenders and each relevant Lender’s
share thereof.
(f) (e) The entries made in the accounts maintained pursuant to paragraph (c) or (d) of this Section shall be conclusive absent manifest error of the
existence and amounts of the obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any error
therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.
SECTION 2.08 Prepayments .
(a) The Borrower may at any time and from time to time prepay Loans, in whole or in part, without premium or penalty (except as specifically provided in
the last sentence of this Section 2.08(a)) , upon notice delivered to the Administrative Agent no later than 12:00 noon, New York City time (or in the case of an
Alternative Currency, 11:00 a.m., London time), not less than three Business Days prior thereto, in the case of Eurocurrency Loans, no later than 12:00 noon, New
York City time, on the date of such notice, in the case of ABR Loans, which notice shall specify the date and amount of prepayment and the Loans to be prepaid;
provided that, if a Eurocurrency Loan is prepaid on any day other than the last day of the Interest Period applicable thereto, the Borrower shall also pay any amounts
owing pursuant to Section 2.13. Each such notice may be conditioned on the occurrence of one or more events (it being understood that the Administrative Agent and
Lenders shall be entitled to assume that the Loans contemplated by such notice are to be made unless the Administrative Agent shall have received written notice
revoking such notice of prepayment on or prior to the date of such prepayment). Upon receipt of any such notice the Administrative Agent shall promptly notify each
relevant Lender thereof. If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein, together with (except in
the case of Revolving Loans that are ABR Loans) accrued interest to such date on the amount prepaid. Partial prepayments of Revolving Loans shall be in an
aggregate principal amount that is an integral multiple of $1,000,000 and not less than $5,000,000 (or comparable amounts determined by the Administrative Agent in
the case of Alternative Currency). In the case of each prepayment of Loans pursuant to this Section 2.08(a), the Borrower may
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in its sole discretion select the Loans (of any Class) to be repaid, and such prepayment shall be paid to the appropriate Lenders in accordance with their respective pro
rata share of such Loans . If any Repricing Event occurs prior to the date occurring 12 months after the Incremental Assumption Agreement No.1 Effective Date, the
Borrower agrees to pay to the Administrative Agent, for the ratable account of each Lender with Term B-1 Loans that are subject to such Repricing Event (including
any Lender which is replaced pursuant to Section 2.16(c) as a result of its refusal to consent to an amendment giving rise to such Repricing Event), a fee in an amount
equal to 1.00% of the aggregate principal amount of the Term B-1 Loans subject to such Repricing Event. Such fees shall be earned, due and payable upon the date of
the occurrence of such Repricing Event .
(b) If at any time for any reason the sum of the Dollar Amount of Outstanding Revolving Credit exceeds the Total Revolving Commitments, the Borrower
shall upon learning thereof, or upon the request of the Administrative Agent, immediately prepay the Revolving Loans in an aggregate principal amount at least equal
to the amount of such excess; provided that solely with respect to any excess resulting from currency exchange rate fluctuations, this Section 2.08(b) shall not apply
unless, on the last day of any fiscal quarter of the Borrower, the Dollar Amount of Outstanding Revolving Credit exceeds the Total Revolving Commitments by more
than 2.5% as a result of such fluctuations.
(c) Beginning on the Closing Term B-1 Effective Date, the Borrower shall apply 100% of all cash proceeds net of all fees (including investment banking
fees), commissions, costs and other expenses, (1) all Net Proceeds (other than Net Proceeds of the kind described in the following clause (2)) within five (5) Business
Days after receipt thereof to prepay Term Loans in accordance with clauses (e) and (f) below; provided that no such prepayment shall be required if, on a pro forma
basis after giving effect to such Asset Sale or Recovery Event, the Secured Net Leverage Ratio is less than 1.50 to 1.00 and (2) all Net Proceeds from any issuance or
incurrence of Refinancing Term Loans and Replacement Revolving Facility Commitments (other than solely by means of extending or renewing then existing
Refinancing Term Loans and Replacement Revolving Facility Commitments without resulting in any net proceeds Net Proceeds ), no later than three (3) Business
Days after the date on which such Refinancing Term Loans and/or Replacement Revolving Facility Commitments are incurred, to prepay Term Loans and/or
Revolving Commitments in accordance with Section 2.20.
(d) Not later than five (5) Business Days after the date on which the annual financial statements are, or are required to be, delivered under Section 5.01(a)
with respect to each Excess Cash Flow Period, the Borrower shall calculate Excess Cash Flow for such Excess Cash Flow Period and, if and to the extent the amount
of such Excess Cash Flow is greater than $0, the Borrower shall apply an amount to prepay Term Loans equal to (i) the Required Percentage of such Excess Cash
Flow minus (ii) the sum of (a) to the extent not financed using the proceeds of funded Indebtedness, the amount of any voluntary payments of Term Loans and
amounts used to repurchase outstanding principal of Term Loans during such Excess Cash Flow Period (plus, without duplication of any amounts previously deducted
under this clause (ii), the amount of any such voluntary payments and amounts so used to repurchase principal of Term Loans after the end of such Excess Cash Flow
Period but before the date of prepayment under this clause (d)) pursuant to Sections 2.08(a) and Section 2.21 (it being understood that the amount of any such
payments pursuant to Section 2.21 shall be calculated to equal the amount of cash used to repay principal and not the principal amount deemed prepaid therewith) and
(b) to the extent not financed using the proceeds of funded Indebtedness, the amount of any voluntary payments of Revolving Loans to the extent that Revolving
Commitments are terminated or reduced pursuant to Section 2.06 by the amount of such payments. Such calculation will be set forth in an Officer’s Certificate
delivered to the Administrative Agent setting forth the amount, if any, of Excess Cash Flow for such Excess Cash Flow Period, the amount of any required
prepayment in respect thereof and the calculation thereof in reasonable detail.
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(e) Amounts to be applied in connection with prepayments of Term Loans pursuant to this Section 2.08 shall be applied to the prepayment of the Term
Loans in accordance with Section 2.15(b) until paid in full. In connection with any mandatory prepayments by the Borrower of the Term Loans pursuant to this
Section 2.08, such prepayments shall be applied on a pro rata basis to the then outstanding Term Loans being prepaid irrespective of whether such outstanding Term
Loans are ABR Loans or Eurocurrency Loans; provided that with respect to such mandatory prepayment, the amount of such mandatory prepayment shall be applied
(i) first to Term Loans that are ABR Loans to the full extent thereof before application to Term Loans that are Eurocurrency Loans in a manner that minimizes the
amount of any payments required to be made by the Borrower pursuant to Section 2.13 and (ii) on a pro rata basis with respect to each Class of Term Loans except to
the extent any Incremental Assumption Agreement, Extension Amendment or Refinancing Amendment provides that the Class of Term Loans incurred thereunder is
to receive less than its pro rata share, in which case such prepayment shall be allocated to such Class of Term Loans as set forth in such Incremental Assumption
Agreement, Extension Amendment or Refinancing Amendment and to the other Classes of Term Loans on a pro rata basis. Each prepayment of the Term Loans under
this Section 2.08 shall be accompanied by accrued interest to the date of such prepayment on the amount prepaid.
(f) The Borrower shall notify the Administrative Agent in writing of any mandatory prepayment of Term Loans required to be made pursuant to Section
2.08(c)(1) or 2.08(d) at least four (4) Business Days prior to the date of such prepayment. Each such notice shall specify the date of such prepayment and provide a
reasonably detailed calculation of the amount of such prepayment. The Administrative Agent will promptly notify each Term Lender of the contents of any such
prepayment notice and of such Term Lender’s ratable portion of such prepayment (based on such Lender’s pro rata share of each relevant Class of the Term Loans).
Any Term Lender (a “Declining Term Lender,” and any Term Lender which is not a Declining Term Lender, an “Accepting Term Lender”) may elect, by delivering
written notice to the Administrative Agent and the Borrower no later than 5:00 p.m. one (1) Business Day after the date of such Term Lender’s receipt of notice from
the Administrative Agent regarding such prepayment, that the full amount of any mandatory prepayment otherwise required to be made with respect to the Term
Loans held by such Term Lender pursuant to Section 2.08(c)(1) or 2.08(d) not be made (the aggregate amount of such prepayments declined by the Declining Term
Lenders, the “Declined Prepayment Amount”). If a Term Lender fails to deliver notice setting forth such rejection of a prepayment to the Administrative Agent within
the time frame specified above or such notice fails to specify the principal amount of the Term Loans to be rejected, any such failure will be deemed an acceptance of
the total amount of such mandatory prepayment of Term Loans. In the event that the Declined Prepayment Amount is greater than $0, the Administrative Agent will
promptly notify each Accepting Term Lender of the amount of such Declined Prepayment Amount and of any such Accepting Term Lender’s ratable portion of such
Declined Prepayment Amount (based on such Lender’s pro rata share of the Term Loans (excluding the pro rata share of Declining Term Lenders)). Any such
Accepting Term Lender may elect, by delivering, no later than 5:00 p.m. one (1) Business Day after the date of such Accepting Term Lender’s receipt of notice from
the Administrative Agent regarding such additional prepayment, a written notice, that such Accepting Term Lender’s ratable portion of such Declined Prepayment
Amount not be applied to repay such Accepting Term Lender’s Term Loans, in which case the portion of such Declined Prepayment Amount which would otherwise
have been applied to such Term Loans of the Declining Term Lenders shall instead be retained by the Borrower. Each Term Lender’s ratable portion of such Declined
Prepayment Amount (unless declined by the respective Term Lender as described in the preceding sentence) shall be applied to the respective Term Loans of such
Lenders. For the avoidance of doubt, the Borrower may, at its option, apply any amounts retained in accordance with the immediately preceding sentence to prepay
loans in accordance with Section 2.08(a).
(g) Any prepayment of Term Loans of any Class shall be applied (i) in the case of prepayments made pursuant to Section 2.08(a), to reduce the subsequent
scheduled repayments of the Term Loans of such Class to be made pursuant to Section 2.07 as directed by the Borrower, or as otherwise provided in any Extension
Amendment,
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any Incremental Assumption Amendment or Refinancing Amendment, and (ii) in the case of prepayments made pursuant to Section 2.08(c) or Section 2.08(d), to
reduce the subsequent scheduled repayments of the Term Loans of such Class to be made pursuant to this Section in direct order of maturity, or as otherwise provided
in any Extension Amendment, any Incremental Assumption Amendment or Refinancing Amendment.
SECTION 2.09 Fees .
(a) The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender a commitment fee in Dollars for the period from and
including the Closing Date to the last day of the Revolving Commitment Period, computed at the applicable Commitment Fee Rate on the average daily Dollar
Amount of the Available Revolving Commitment of such Lender during the period for which payment is made, payable quarterly in arrears on each Revolving Fee
Payment Date, commencing on December 31, 2015.
(b) The Borrower agrees to pay (i) to the Administrative Agent for the account of each Revolving Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Applicable Rate used to determine the interest rate applicable to Eurocurrency Loans on the average
daily Dollar Amount of such Revolving Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the period from
and including the Closing Date to but excluding the later of the date on which such Revolving Lender’s Revolving Commitment terminates and the date on which
such Revolving Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a fronting fee, which shall accrue at the rate of 0.125 % per annum on the
average daily Dollar Amount of the LC Exposure of the Letters of Credit issued by it (excluding any portion thereof attributable to unreimbursed LC Disbursements)
during the period from and including the Closing Date to but excluding the later of the date of termination of the Revolving Commitments and the date on which there
ceases to be any such LC Exposure, as well as the fees agreed by the Issuing Bank and the Borrower with respect to the issuance, amendment, renewal or extension of
any Letter of Credit or processing of drawings thereunder. Participation fees and fronting fees will be payable in Dollars quarterly in arrears on each Revolving Fee
Payment Date, commencing on December 31, 2015; provided that any such fees accruing after the date on which the Revolving Commitments terminate shall be
payable on demand. Any other fees payable to the Issuing Bank pursuant to this paragraph shall be payable within 10 days after demand. All participation fees and
fronting fees shall be computed on the basis of a year of 365/366 days and shall be payable for the actual number of days elapsed (including the first day but excluding
the last day).
(c) The Borrower agrees to pay to the Administrative Agent the fees in the amounts and on the dates as set forth in any fee agreements with the
Administrative Agent and to perform any other obligations contained therein.
(d) All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution, in the case of
commitment fees, to the Revolving Lenders. Fees paid shall not be refundable under any circumstances. All per annum fees shall be computed on the basis of a year
of 365/366 days for actual days elapsed; provided that commitment fees shall be computed on the basis of a year of 360 days.
SECTION 2.10 Interest .
(a) The Loans comprising each ABR Borrowing shall bear interest at the Alternate Base Rate plus the Applicable Rate.
(b) The Loans comprising each Eurocurrency Borrowing in any currency shall bear interest at the Eurocurrency Rate for such currency for the Interest
Period in effect for such Borrowing plus the Applicable Rate.
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(c) Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder is not paid
when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment, at a rate per annum
equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section or
(ii) in the case of any other amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section (in the case of such other amount in
Dollars) or 2% plus the daily weighted average rate of all Loans in the relevant Alternative Currency (in the case of any such other amount in such Alternative
Currency).
(d) Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and, in addition, in the case of Revolving Loans,
upon termination of the Revolving Commitments; provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be payable on demand, (ii) in the
event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Loan prior to the end of the Revolving Commitment Period) , accrued
interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any
Eurocurrency Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.
(e) All interest hereunder shall be computed on the basis of a year of 360 days, except that (i) (A) interest computed by reference to the Alternate Base Rate
at times when the Alternate Base Rate is based on the Prime Rate and (B) interest computed by reference to the Australian Dollar Bank Bill Reference Rate and the
CDOR Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year) and (ii) interest in respect of Borrowings in Sterling shall be computed
on the basis of 365 days, and in each case of the foregoing clauses (i) and (ii) shall be payable for the actual number of days elapsed (including the first day but
excluding the last day). The applicable Alternate Base Rate or Eurocurrency Rate shall be determined by the Administrative Agent, and such determination shall be
conclusive absent manifest error.
SECTION 2.11 Alternate Rate of Interest .
(a) If at the time that the Administrative Agent shall seek to determine the Reference Bank Rate less than two Reference Banks shall supply a rate to the
Administrative Agent for purposes of determining the Eurocurrency Rate for such Eurocurrency Borrowing, then (a) the Borrower and the Administrative Agent may
mutually agree in their reasonable discretion to appoint one or more additional Reference Banks (subject to consent by such Reference Bank(s)) for purposes of
establishing the Reference Bank Rate that shall be the Eurocurrency Rate for such Interest Period for such Eurocurrency Borrowing, or (b) if no additional Reference
Banks are so appointed or if additional Reference Banks are so appointed and less than two Reference Banks supply such a rate, then the Administrative Agent shall
be deemed to have determined that adequate and reasonable means do not exist for ascertaining the Eurocurrency Rate for such Eurocurrency Borrowing and Section
2.11(b)(i) shall apply.
(b) If prior to the commencement of any Interest Period for a Eurocurrency Borrowing:
(i) the Administrative Agent determines (which determination shall be conclusive and binding absent manifest error) that adequate and
reasonable means do not exist for ascertaining the Eurocurrency Rate for a Loan in the applicable currency or for the applicable Interest Period; or
(ii) the Administrative Agent is advised by the Required Lenders that the Eurocurrency Rate for a Loan in the applicable currency or for the
applicable Interest Period will not adequately and fairly
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reflect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan) included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter and, until the
Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that
requests the conversion of any Borrowing in Dollars to, or continuation of any Borrowing in Dollars as, a Eurocurrency Borrowing shall be ineffective and the Loans
shall be converted to an ABR Borrowing and (ii) if any borrowing request requests a Eurocurrency Borrowing, such Borrowing, if denominated in Dollars, shall be
made as an ABR Borrowing, and if such borrowing request requests a Borrowing denominated in an Alternative Currency or if any Interest Election Request requests
the continuation of a Eurocurrency Borrowing in an Alternative Currency, such Borrowing or continuation shall be made or continued as a Borrowing bearing interest
at an interest rate reasonably determined by the Administrative Agent, after consultation with the Borrower and the applicable Lenders, to compensate the applicable
Lenders for such Borrowing in such currency for the applicable period plus the Applicable Rate; provided that if the circumstances giving rise to such notice affect
only Borrowings in one currency, then Borrowings in other currencies will not be affected by the provisions of this Section.
SECTION 2.12 Increased Costs .
(a) 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 by, any Lender (including any reserve for eurocurrency funding that may be established or
reestablished under Regulation D of the Board);
(ii) impose on any Lender any Taxes other than (A) Indemnified Taxes or Other Taxes indemnified under Section 2.14 or (B) Excluded Taxes;
or
Lender;
(iii) impose on any Lender or the London interbank market any other condition affecting this Agreement or Eurocurrency Loans made by such
and the result of any of the foregoing shall be to increase the cost to such Lender of making, continuing, converting into or maintaining any Eurocurrency Loan (or of
maintaining its obligation to make any such Loan) or to increase the cost to such Lender or Issuing Bank of participating in, issuing or maintaining any Letter of
Credit or to reduce the amount of any sum received or receivable by such Lender hereunder (whether of principal, interest or otherwise), then 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.
(b) If any Lender determines that any Change in Law regarding capital or liquidity 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 or the Loans made by such Lender 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 capital adequacy), then from time to time 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.
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(c) 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 paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such Lender
the amount shown as due on any such certificate within 10 days after receipt thereof.
(d) Failure or delay on the part of any Lender to demand compensation pursuant to this Section 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 this Section for any increased costs or reductions
incurred more than 180 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; provided further 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.
SECTION 2.13 Break Funding Payments . In the event of (a) the payment of any principal of any Eurocurrency Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurocurrency Loan other than on the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Eurocurrency Loan on the date specified in any notice delivered pursuant hereto or
(d) the assignment of any Eurocurrency Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant to
Section 2.16, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a
Eurocurrency Loan, such loss, cost or expense to any Lender shall be deemed to be an amount determined by such Lender to be the excess, if any, of (i) the amount of
interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Eurocurrency Rate that would have been applicable to
such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for
such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for deposits in the relevant currency of a comparable
amount and period from other banks in the eurocurrency market (but not less than the available Eurocurrency rate quoted for the Eurocurrency interest period equal to
the period from the date of such event to the last day of the then current Interest Period, or if there is no such Eurocurrency interest period, the lower of the
Eurocurrency rates quoted for the closest Eurocurrency interest periods that are longer and shorter than such period). A certificate of any Lender setting forth any
amount or amounts that such Lender is entitled to receive pursuant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest error.
The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.
SECTION 2.14 Taxes .
(a) All payments by or on account of any obligation of any Loan Party hereunder or under any other Loan Document shall be made free and clear of and
without deduction for any Taxes unless required by applicable Requirements of Law; provided that if any applicable withholding agent shall be required by applicable
Requirements of Law to deduct any Taxes in respect of any such payments, then (i) if such Tax is an Indemnified Tax or Other Tax, the sum payable shall be
increased by the applicable Loan Party as necessary so that after all required deductions (including deductions applicable to additional sums payable under this
Section 2.14) have been made the applicable Lender (or, in the case of a payment made to the Administrative Agent for its own account, the Administrative Agent)
receives an amount equal to the sum it would have received had no such deductions been made, (ii) the applicable withholding agent shall make such deductions and
(iii) the applicable withholding agent
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shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable Requirements of Law.
(b) In addition, without duplication of any obligation set forth in subsection (a), the Borrower shall pay any Other Taxes to the relevant Governmental
Authority in accordance with applicable Requirements of Law.
(c) Without duplication of any obligation set forth in subsection (a), the Loan Parties shall indemnify the Administrative Agent and each Lender, within 10
days after written demand therefor, for the full amount of any Indemnified Taxes paid by the Administrative Agent or such Lender, as the case may be, on or with
respect to any payment by or on account of any obligation of any Loan Party hereunder or under any other Loan Document and any Other Taxes paid by the
Administrative Agent or such Lender (including Indemnified Taxes or Other Taxes imposed on asserted on or attributable to amounts payable under this Section 2.14)
and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other 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 the Borrower by a Lender, or by the
Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error. If the Borrower determines that there is a reasonable basis
to contest any Indemnified Tax or Other Tax for which it is responsible hereunder, without limiting Borrower’s indemnification obligations hereunder, such
Administrative Agent or Lender (as applicable) shall reasonably cooperate in pursuing such contest (at Borrower’s expense) so long as pursuing such contest would
not, in the sole reasonable determination of the Administrative Agent or Lender, result in any additional unreimbursed costs or expenses or be otherwise
disadvantageous to the Administrative Agent or such Lender. This Section shall not be construed to require the Administrative Agent or Lender to make available its
tax returns (or any other information relating to its Taxes which it deems confidential) to the Borrower or any other Person.
(d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by any Loan Party to a Governmental Authority, the Borrower shall
deliver to the Administrative Agent a copy, or if reasonably available to the Borrower a certified copy, of a receipt issued by such Governmental Authority evidencing
such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.
(e) (i) Each Lender shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the
Administrative Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Administrative Agent as will permit such
payments to be made without withholding Tax or at a reduced rate of withholding.
(ii) Without limiting the generality of the foregoing,
(A) any U.S. Lender shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender
under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), properly executed
originals of IRS Form W‑9 certifying that such Lender is exempt from U.S. federal backup withholding Tax;
(B) any Non-U.S. Lender shall, to the extent it is legally eligible to do so, deliver to the Borrower and the Administrative Agent on or prior to the
date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or
the Administrative Agent), whichever of the following is applicable to establish such Non-U.S. Lender’s entitlement to a reduced rate of, or exemption from,
withholding:
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(1) two properly executed originals of IRS Form W‑8BEN or W-8BEN-E establishing an exemption from, or reduction of, U.S. federal
withholding Tax pursuant to an income tax treaty to which the United States is a party;
(2) two properly executed originals of IRS Form W‑8ECI;
(3) (x) executed originals of a certificate substantially in the form of Exhibit G-1 to the effect that such Non-U.S. Lender is not (A) a
“bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of Section
881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code, and that no payments to be
received by such Lender will be effectively connected income (a “ U.S. Tax Compliance Certificate ”) and (y) two properly executed originals of
IRS Form W-8BEN or W-8BEN-E; or
(4) to the extent a Lender is not the beneficial owner (for example, where the Lender is a partnership, or has sold a participation), two
properly executed originals of IRS Form W‑8IMY, accompanied by properly executed IRS Form W‑8ECI, IRS Form W‑8BEN or W-8BEN-E, a
U.S. Tax Compliance Certificate substantially in the form of Exhibit G-2 or Exhibit G-3 , IRS Form W‑9, and/or other certification documents from
each beneficial owner, as applicable; provided that if the Non-U.S. Lender is a partnership (and not a participating Lender), and one or more direct
or indirect partners of such Non-U.S. Lender are claiming the portfolio interest exemption, such Non-U.S. Lender may provide a U.S. Tax
Compliance Certificate substantially in the form of Exhibit G-4 on behalf of such direct and indirect partner(s); and
(5) any Non-U.S. Lender shall, to the extent it is legally eligible to do so, deliver to the Borrower and the Administrative Agent (in such
number of copies as shall be requested by the recipient) on or prior to the date on which such Non-U.S. Lender becomes a Lender under this
Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of any
other form prescribed by applicable Requirements of 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
or the Administrative Agent to determine the withholding or deduction required to be made.
(iii) If a payment made to a Lender under this Agreement or the other Loan Documents would be subject to U.S. Federal withholding 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 or 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 Requirements of 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 or the Administrative Agent to comply with its obligations under FATCA, to determine whether such Lender has or has not complied with such Lender's
obligations under FATCA and, as necessary, to determine the amount, if any, to deduct and withhold from such payment. Solely for purposes of this Section 2.14(e)
(iii), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
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(iv) Each Lender agrees that if any documentation it previously delivered pursuant to this Section 2.14(e) expires or becomes obsolete or inaccurate in
any respect, it shall update such documentation or promptly notify the Borrower and the Administrative Agent in writing of its legal ineligibility to do so.
(v) Each Lender hereby authorizes the Administrative Agent to deliver to the Loan Parties and to any successor Administrative Agent any
documentation provided by such Lender to the Administrative Agent pursuant to this Section 2.14(e) .
(f) If the Administrative Agent or a Lender determines, in its reasonable discretion, that it has received a refund of any Taxes or Other Taxes as to which it
has been indemnified by a Loan Party or with respect to which the Loan Party has paid additional amounts pursuant to this Section 2.14, it shall pay over such refund
to the Loan Party (but only to the extent of indemnity payments made, or additional amounts paid, by the Loan Party under this Section 2.14 with respect to the Taxes
or Other Taxes giving rise to such refund), net of all reasonable out-of-pocket expenses (including any Taxes) of the Administrative Agent or such Lender and without
interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that the Loan Party agrees to repay the amount
paid over to the Loan Party (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Administrative Agent or such Lender
in the event the Administrative Agent or such Lender is required to repay such refund to such Governmental Authority. This Section shall not be construed to require
the Administrative Agent or any Lender to make available its tax returns (or any other information relating to its Taxes which it deems confidential) to the Borrower
or any other Person.
SECTION 2.15 Pro Rata Treatment and Payments .
(a) Each borrowing of Revolving Loans by the Borrower from the Revolving Lenders and any reduction of the Revolving Commitments of the Revolving
Lenders shall be made pro rata according to the respective Revolving Commitments then held by the Revolving Lenders. Each payment by the Borrower on account
of any commitment fee or any letter of credit fee shall be paid ratably to the Revolving Lenders entitled thereto.
(b) Each prepayment by the Borrower on account of principal of any Loans of any Class shall be made pro rata according to the respective outstanding
principal amounts of Loans of such Class then held by the Lenders entitled to such payment (subject in the case of Term B-1 Loans to Section 2.08(f)) . All
repayments of principal of any Loans at stated maturity or upon acceleration shall be allocated pro rata according to the respective outstanding principal amounts of
the matured or accelerated Loans then held by the relevant Lenders. All payments of interest in respect of any Loans shall be allocated pro rata according to the
outstanding interest payable then owed to the relevant Lenders. Notwithstanding the foregoing, (A) any amount payable to a Defaulting Lender under this Agreement
(whether on account of principal, interest, fees or otherwise but excluding any amount that would otherwise be payable to such Defaulting Lender pursuant to Section
2.16 and Section 9.05) shall, in lieu of being distributed to such Defaulting Lender, be retained by the Administrative Agent in a segregated interest-bearing account
and, subject to any applicable Requirements of Law, be applied at such time or times as may be determined by the Administrative Agent: (1) first, to the payment of
any amounts owing by such Defaulting Lender to the Administrative Agent and the Issuing Bank hereunder (including amounts owed under Section 2.09(b) or
9.04(c)), (2) second, to the funding of any Loan or LC Disbursement required by this Agreement, as determined by the Administrative Agent, (3) third, if so
determined by the Administrative Agent and Borrower, held in such account as cash collateral for future funding obligations of the Defaulting Lender under this
Agreement, (4) fourth, pro rata, to the payment of any amounts owing to the Borrower or the Lenders as a result of such Defaulting Lender’s breach of its obligations
under this Agreement and (5) fifth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction, and (B) if such payment is a prepayment
of the principal amount of Loans, such payment
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shall be applied solely to prepay the Loans of all Non-Defaulting Lenders pro rata (based on the amounts owing to each) prior to being applied to the prepayment of
any Loan of any Defaulting Lender.
(c) All payments (including prepayments) to be made by the Borrower hereunder, whether on account of principal, interest, fees or otherwise, shall be
made without setoff or counterclaim and shall be made prior to 2:00 p.m., New York City time (or as specified in the next sentence in the case of Loans in an
Alternative Currency), on the date when due. Except as otherwise expressly provided herein, all payments by the Borrower hereunder with respect to principal and
interest on Loans in an Alternative Currency shall be made on the dates specified herein for the pro rata account of the relevant Lenders to which such payment is
owed, in such Alternative Currency and in immediately available funds not later than the Applicable Time specified by the Administrative Agent to the Borrower by
the same time at least one Business Day prior to the date when due. All payments received by the Administrative Agent (i) after 2:00 p.m., New York City time, in the
case of payments in Dollars, or (ii) after the Applicable Time specified by the Administrative Agent in the case of payments in an Alternative Currency, may, in the
discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest and fees thereon.
All such payments shall be made to the Administrative Agent at its offices at 500 Stanton Christiana Road, Ops Building 2, 3 rd Floor, Newark, Delaware except that
payments pursuant to Sections 2.12, 2.13, 2.14 and 9.04 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute such
payments to the relevant Lenders promptly upon receipt in like funds as received. If any payment hereunder becomes due and payable on a day other than a Business
Day, such payment shall be extended to the next succeeding Business Day. In the case of any extension of any payment of principal, interest thereon shall be payable
at the then applicable rate during such extension.
(d) If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest and fees then
due hereunder, such funds shall be applied (subject to the rights of the Administrative Agent to hold and apply amounts to be paid to a Defaulting Lender in
accordance with Section 2.15(b)) (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the
amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal then due hereunder, ratably among the parties entitled thereto in
accordance with the amounts of principal then due to such parties. To the extent necessary, the Administrative Agent shall enter into foreign currency exchange
transactions on customary terms to effect any such ratable payment and the payments made by the Administrative Agent following such transactions shall be deemed
to be payments made by or on behalf of the Borrower hereunder.
(e) If any Lender shall, by exercising any right of set‑off or counterclaim or otherwise, obtain payment in respect of any principal of or interest on any of
its Loans or participations in LC Disbursements of a given Class resulting in such Lender receiving payment of a greater proportion of the aggregate principal amount
of its Loans and participations in LC Disbursements of such Class and accrued interest thereon than the proportion received by any other Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value) participations in the Loans and participations in LC Disbursements of such Class of other
Lenders to the extent necessary so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of
and accrued interest on their respective Loans and participations in LC Disbursements of such Class; provided that (i) if any such participations are purchased and all
or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery,
without interest, and (ii) the provisions of this paragraph shall not be construed to apply to any payment made by the Borrower or any other Loan Party pursuant to
and in accordance with the express terms of this Agreement and the other Loan Documents or 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.
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SECTION 2.16 Mitigation Obligations; Replacement of Lenders .
(a) If any Lender requests compensation under Section 2.12, or if 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 2.14, 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 2.12 or 2.14, as the case may be, in the future and (ii)
would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay
all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment. Each Lender may designate a different lending
office for funding or booking its Loans hereunder or assign its rights and obligations hereunder to another of its offices, branches or affiliates; provided that the
exercise of this option shall not affect the obligations of the Borrower to repay the Loan in accordance with the terms of this Agreement.
(b) If any Lender requests compensation under Section 2.12, or if 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 2.14, or if any Lender is a Defaulting Lender, 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 Section 9.05), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which
assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the
Administrative Agent (and if a Revolving Commitment is being assigned, the Issuing Bank), which consent shall not unreasonably be withheld, (ii) such Lender shall
have received payment of an amount equal to the outstanding principal of its Loans and participations in unreimbursed LC Disbursements, accrued interest thereon,
accrued fees and all other amounts payable to it hereunder, 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) and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.12 or payments
required to be made pursuant to Section 2.14, such assignment will result in a reduction in such compensation or payments. A Lender shall not be required to make
any such assignment and 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.
(c) If any Lender (such Lender, a “ Non-Consenting Lender ”) has failed to consent to a proposed amendment, waiver, discharge or termination which
pursuant to the terms of Section 9.02 requires the consent of all of the Lenders affected and with respect to which the Required Lenders shall have granted their
consent, then the Borrower shall have the right (unless such Non-Consenting Lender grants such consent) to replace such Non-Consenting Lender by requiring such
Non-Consenting Lender to assign its Loans, and its Revolving Commitments hereunder to one or more assignees reasonably acceptable to the Administrative Agent,
provided that: (a) all amounts owing to such Non-Consenting Lender being replaced (other than principal and interest) shall be paid in full to such Non-Consenting
Lender concurrently with such assignment, and (b) the replacement Lender (each such Lender, a “ Replacement Lender ”) shall purchase the foregoing by paying to
such Non-Consenting Lender a price equal to the principal amount thereof plus accrued and unpaid interest thereon. In connection with any such assignment the
Borrower, Administrative Agent, such Non-Consenting Lender and the Replacement Lender shall otherwise comply with Section 9.05.
(d) Notwithstanding anything herein to the contrary, each party hereto agrees that any assignment pursuant to the terms of Section 2.16(c) may be effected
pursuant to an Assignment and Assumption executed by the
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Borrower, the Administrative Agent and the assignee and that the Lender making such assignment need not be a party thereto.
SECTION 2.17 Letters of Credit .
(a) General . Subject to the terms and conditions set forth herein, the Borrower may request that standby letters of credit denominated in Dollars or an
Alternative Currency be issued under this Agreement for its own account or the account of any Restricted Subsidiary, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time during the Revolving Commitment Period. In the event of any inconsistency between
the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control.
(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions . To request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), the Borrower shall hand deliver or telecopy (or transmit by electronic communication, if arrangements for doing so have
been approved by the Issuing Bank) to the Issuing Bank and the Administrative Agent (reasonably in advance of the requested date of issuance, amendment, renewal
or extension, but in any event no later than two Business Days prior to such date unless otherwise agreed by the Issuing Bank and the Administrative Agent) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying the date of issuance, amendment,
renewal or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply with paragraph (c) of this Section), the
amount and currency of such Letter of Credit, the name and address of the beneficiary thereof and such other information as shall be necessary to prepare, amend,
renew or extend such Letter of Credit. If requested by the Issuing Bank, the Borrower also shall submit a letter of credit application on the Issuing Bank’s standard
form in connection with any request for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or extended only if, after giving effect to such
issuance, amendment, renewal or extension (i) the LC Exposure shall not exceed $40,000,000, (ii) the Dollar Amount of the total Outstanding Revolving Credits shall
not exceed the Total Revolving Commitments and (iii) with respect to such Issuing Bank, the sum of the aggregate face amount of Letters of Credit issued by such
Issuing Bank, when aggregated with the outstanding Revolving Loans funded by such Issuing Bank, shall not exceed its Revolving Commitment. If the Borrower so
requests in any applicable letter of credit application, the Issuing Bank may, in its sole discretion, agree to issue a Letter of Credit that has automatic extension
provisions (each, an “ Auto-Extension Letter of Credit ”); provided that any such Auto-Extension Letter of Credit must permit the Issuing Bank to prevent any such
extension 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 “ Non-Extension 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 Issuing Bank, the Borrower shall not be required to make a specific request to the Issuing Bank for any such extension. Once an Auto-
Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized (but may not require) the Issuing Bank to permit the extension of such
Letter of Credit at any time to an expiry date not later than the Letter of Credit expiration date referenced in clause (c) below; provided , however , that the Issuing
Bank shall not permit any such extension if (A) the Issuing Bank has determined that it would not be permitted, or would have no obligation, at such time to issue
such Letter of Credit in its revised form (as extended) under the terms hereof, or (B) it has received notice (which may be by telephone or in writing) on or before the
day that is seven Business Days before the Non-Extension Notice Date (1) from the Administrative Agent that the Required Lenders have elected not to permit such
extension or (2) from the Administrative Agent, any Lender or the Borrower that one or more of the applicable conditions specified in Section 4.02 is not then
satisfied, and in each such case directing the Issuing Bank not to permit such extension. The Issuing Bank shall not be under any
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obligation to issue any Letter of Credit if: (A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or
restrain the Issuing Bank from issuing the Letter of Credit, or any Law applicable to the Issuing Bank or any request or directive (whether or not having the force of
law) from any Governmental Authority with jurisdiction over the Issuing Bank shall prohibit, or request that the Issuing Bank refrain from, the issuance of letters of
credit generally or the Letter of Credit in particular or shall impose upon the Issuing Bank with respect to the Letter of Credit any restriction, reserve or capital
requirement (for which the Issuing Bank is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the Issuing Bank any
unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the Issuing Bank in good faith deems material to it; (B) the issuance of
the Letter of Credit would violate one or more policies of the Issuing Bank applicable to letters of credit generally.
(c) Expiration Date . Each Letter of Credit shall expire at or prior to the close of business on the earlier of (i) the date one year after the date of the
issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (ii) the date that is five Business
Days prior to the Revolving Termination Date.
(d) Participations . By the issuance of a Letter of Credit (or an amendment to a Letter of Credit increasing the amount thereof) and without any further
action on the part of the Issuing Bank or the Revolving Lenders, the Issuing Bank hereby grants to each Revolving Lender, and each Revolving Lender hereby
acquires from the Issuing Bank, a participation in such Letter of Credit equal to such Revolving Lender’s Revolving Commitment Percentage of the aggregate amount
available to be drawn under such Letter of Credit. In consideration and in furtherance of the foregoing, each Revolving Lender hereby absolutely and unconditionally
agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Revolving Lender’s Revolving Commitment Percentage of each LC
Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (e) of this Section, or of any reimbursement
payment required to be refunded to the Borrower for any reason. Such payment by the Lenders shall be made (i) if the currency of the applicable LC Disbursement or
reimbursement payment shall be Dollars, then in the currency of such LC Disbursement and (ii) subject to clause (l) of this Section, if the currency of the applicable
LC Disbursement or reimbursement payment shall be an Alternative Currency, in Dollars in an amount equal to the Dollar Amount of such LC Disbursement or
reimbursement payment, calculated by the Administrative Agent using the Exchange Rate on the applicable LC Participation Calculation Date. Each Revolving
Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and
shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence and continuance of a
Default or reduction or termination of the Revolving Commitments, and that each such payment shall be made without any offset, abatement, withholding or
reduction whatsoever.
(e) Reimbursement . If the Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such LC
Disbursement by paying to the Administrative Agent in the currency of such LC Disbursement an amount equal to such LC Disbursement not later than 12:00 noon,
New York City time, on the date that such LC Disbursement is made, if the Borrower shall have received notice of such LC Disbursement prior to 10:00 a.m., New
York City time, on such date, or, if such notice has not been received by the Borrower prior to such time on such date, then not later than 12:00 noon, New York City
time, on the Business Day immediately following the day that the Borrower receives such notice; provided that if such LC Disbursement is denominated in Dollars
and is not less than $1,000,000, the Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 that such payment
be financed with an ABR Revolving Borrowing in an equivalent amount and, to the extent so financed, the Borrower’s obligation to make such payment shall be
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discharged and replaced by the resulting ABR Revolving Borrowing. If the Borrower fails to make such payment when due, (A) if such payment relates to a Letter of
Credit denominated in an Alternative Currency, automatically and no further action required, the obligations of the Borrower to reimburse the applicable LC
Disbursement shall be permanently converted into an obligation to reimburse the Dollar Amount, calculated using the Exchange Rate on the applicable LC
Participation Calculation Date, of such LC Disbursement and (B) in the case of each LC Disbursement, the Administrative Agent shall notify each Revolving Lender
of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Revolving Lender’s Revolving Commitment Percentage
thereof. Promptly following receipt of such notice, each Revolving Lender shall pay to the Administrative Agent its Revolving Commitment Percentage of the
payment then due from the Borrower, in the same manner as provided in Section 2.04 with respect to Loans made by such Revolving Lender (and Section 2.04 shall
apply, mutatis mutandis , to such payment obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the Issuing Bank the amounts so
received by it from the Revolving Lenders. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this paragraph, the
Administrative Agent shall distribute such payment to the Issuing Bank or, to the extent that Revolving Lenders have made payments pursuant to this paragraph to
reimburse the Issuing Bank, then to such Revolving Lenders and the Issuing Bank as their interests may appear. Any payment made by a Revolving Lender pursuant
to this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than the funding of ABR Loans as contemplated above) shall not constitute a Loan
and shall not relieve the Borrower of its obligation to reimburse such LC Disbursement. If the Borrower’s reimbursement of, or obligation to reimburse, any amounts
in any Alternative Currency would subject the Administrative Agent, the Issuing Bank or any Revolving Lender to any stamp duty, ad valorem charge or similar Tax
that would not be payable if such reimbursement were made or required to be made in Dollars, such Revolving Borrower shall pay the amount of any such Tax
requested by the Administrative Agent, the Issuing Bank or such Revolving Lender.
(f) Obligations Absolute . The Borrower’s obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be absolute,
unconditional and irrevocable, and shall be performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and
irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein, (ii) any draft or other document
presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in any respect, (iii)
payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such Letter of Credit, or
(iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section, constitute a legal or
equitable discharge of, or provide a right of setoff against, the Borrower’s obligations hereunder; provided that, subject to the penultimate sentence of this clause (f),
reimbursement obligations of the Borrower with respect to a Letter of Credit may be subject to avoidance by the Borrower to the extent of any direct damages (as
opposed to consequential damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower
or any Restricted Subsidiary that are caused by the Issuing Bank’s failure to exercise care when determining whether drafts and other documents presented under a
Letter of Credit comply with the terms thereof. Neither the Administrative Agent, the Revolving Lenders nor the Issuing Bank, nor any of their Related Parties, shall
have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment
thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or
delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any
error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Bank; provided that the foregoing shall not be
construed to excuse the Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to consequential damages, claims in respect of
which
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are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower that are caused by the Issuing Bank’s failure to exercise care
when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. The parties hereto expressly agree that, in the
absence of gross negligence, bad faith or willful misconduct on the part of the Issuing Bank (as finally determined by a court of competent jurisdiction), the Issuing
Bank shall be deemed to have exercised care in each such determination. In furtherance of the foregoing and without limiting the generality thereof, the parties agree
that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the Issuing Bank may, in its
sole discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the
contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.
(g) Disbursement Procedures . The Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Bank shall promptly notify the Administrative Agent and the Borrower by telephone (confirmed by telecopy) of such
demand for payment and whether the Issuing Bank has made or will make an LC Disbursement thereunder; provided that any delay in giving such notice shall not
relieve the Borrower of its obligation to reimburse the Issuing Bank and the Revolving Lenders with respect to any such LC Disbursement.
(h) Interim Interest . If the Issuing Bank shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in full on the
date set forth in paragraph (e) of this Section 2.17, the unpaid amount thereof shall bear interest, for each day from and including the date such LC Disbursement is
required to be reimbursed to but excluding the date that the Borrower reimburses such LC Disbursement, at the rate per annum set forth in Section 2.10(c)(ii). Interest
accrued pursuant to this paragraph shall be for the account of the Issuing Bank, except that interest accrued on and after the date of payment by any Revolving Lender
pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall be for the account of such Revolving Lender to the extent of such payment.
(i) Replacement of the Issuing Bank . The Issuing Bank may be replaced at any time by written agreement among the Borrower, the Administrative Agent,
the replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent shall notify the Revolving Lenders of any such replacement of the Issuing Bank.
At the time any such replacement shall become effective, the Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank pursuant to
Section 2.09(b). From and after the effective date of any such replacement, (i) the successor Issuing Bank shall have all the rights and obligations of the 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 include such
successor and any previous Issuing Bank, or such successor and all previous Issuing Banks, as the context shall require. After the replacement of an Issuing Bank
hereunder, the replaced Issuing Bank shall remain a party hereto 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, but shall not be required to issue additional Letters of Credit.
(j) Additional Issuing Banks . From time to time, the Borrower may by notice to the Administrative Agent designate any Lender (in addition to the initial
Issuing Bank) which agrees (in its sole discretion) to act in such capacity and is reasonably satisfactory to the Administrative Agent as an Issuing Bank. Each such
additional Issuing Bank shall execute a counterpart of this Agreement upon the approval of the Administrative Agent (which approval shall not be unreasonably
withheld) and shall thereafter be an Issuing Bank hereunder for all purposes.
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(k) Cash Collateralization . If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or Revolving Lenders with LC Exposure representing greater than 50% of the total LC Exposure demanding the deposit of cash collateral
pursuant to this paragraph, the Borrower shall deposit in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit of the
Revolving Lenders, an amount in Dollars equal to 102% of the LC Exposure as of such date plus any accrued and unpaid interest thereon; provided that (i) amount
payable in respect of any Letter of Credit or LC Disbursement shall be payable in the currency of such Letter of Credit or LC Disbursement, except that LC
Disbursements in an Alternative Currency in respect of which the Borrower’s reimbursement obligations have been converted in Dollars as provided in paragraph (e)
or (l) of this Section and interest accrued thereon shall be payable in Dollars, and (ii) the obligation to deposit such cash collateral shall become effective immediately,
and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to
the Borrower described in clause (h) or (i) of Article VII. Such deposit shall be held by the Administrative Agent as collateral for the payment and performance of the
obligations of the Borrower under this Agreement with respect to the Revolving Facility. The Administrative Agent shall have exclusive dominion and control,
including the exclusive right of withdrawal, over such account. Other than any interest earned on the investment of such deposits, which investments shall be made at
the option and sole discretion of the Administrative Agent and at the Borrower’s risk and expense, such deposits shall not bear interest. Interest or profits, if any, on
such investments shall accumulate in such account. Moneys in such account shall be applied by the Administrative Agent to reimburse the Issuing Bank for LC
Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the reimbursement obligations of the
Borrower for the LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of Lenders with LC Exposure representing
greater than 50% of the total LC Exposure), be applied to satisfy other obligations of the Borrower under this Agreement with respect to the Revolving Facility. If the
Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence 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.
(l) Conversion . In the event that the Loans become immediately due and payable on any date pursuant to Section 7.01, all amounts (i) that the Borrower
are at the time or become thereafter required to reimburse or otherwise pay to the Administrative Agent in respect of LC Disbursements made under any Letter of
Credit denominated in an Alternative Currency, (ii) that the Revolving Lenders are at the time or become thereafter required to pay to the Administrative Agent (and
the Administrative Agent is at the time or becomes thereafter required to distribute to the Issuing Bank) pursuant to paragraph (e) of this Section in respect of
unreimbursed LC Disbursements made under any Letter of Credit denominated in an Alternative Currency and (iii) of each Revolving Lender’s participation in any
Letter of Credit denominated in an Alternative Currency under which an LC Disbursement has been made shall, automatically and with no further action required, be
converted into the Dollar Amount, calculated using the Exchange Rate on such date (or in the case of any LC Disbursement made after such date, on the date such LC
Disbursement is made), of such amounts. On and after such conversion, all amounts accruing and owed to the Administrative Agent, the Issuing Bank or any
Revolving Lender in respect of the obligations described in this paragraph shall accrue and be payable in Dollars at the rates otherwise applicable hereunder.
(m) Applicability of ISP; Limitation of Liability . Unless otherwise expressly agreed by the Issuing Bank and the Borrower when a Letter of Credit is
issued, the rules of the ISP shall apply to each standby Letter of Credit. Notwithstanding the foregoing, the Issuing Bank shall not be responsible to the Borrower for,
and the Issuing Bank’s rights and remedies against the Borrower shall not be impaired by, any action or inaction of the Issuing Bank required or permitted under any
law, order, or practice that is required or permitted to be applied to any
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Letter of Credit or this Agreement, including the Law or any order of a jurisdiction where the Issuing Bank or the beneficiary is located, the practice stated in the ISP,
or in the decisions, opinions, practice statements, or official commentary of the ICC Banking Commission, the Bankers Association for Finance and Trade -
International Financial Services Association (BAFT-IFSA), or the Institute of International Banking Law & Practice, whether or not any Letter of Credit chooses such
law or practice.
(n) Conflict with Issuer Documents . In the event of any conflict between the terms hereof and the terms of any Letter of Credit or related document, the
terms hereof shall control.
SECTION 2.18 Defaulting Lenders . Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then
the following provisions shall apply for so long as such Lender is a Defaulting Lender:
(a) Fees shall cease to accrue on the Available Revolving Commitment of such Defaulting Lender pursuant to Section 2.09(a).
(b) The Revolving Commitment Commitments, Loans and Outstanding Revolving Credit of such Defaulting Lender shall not be included in
determining whether the Required Lenders or Required Revolving Lenders have taken or may take any action hereunder (including any consent to any
amendment, waiver or other modification pursuant to Section 9.02 or Section 9.03); provided that this Section 2.18(b) shall not apply to the vote of a
Defaulting Lender in the case of an amendment, waiver or other modification effecting (i) an increase or extension of such Defaulting Lender’s Revolving
Commitment or (ii) the reduction or excuse of principal amount of, or interest or fees payable on, such Defaulting Lender’s Loans or the postponement of the
scheduled date of payment of such principal amount, interest or fees to such Defaulting Lender.
(c) If any Letters of Credit exist at the time such Lender becomes a Defaulting Lender then:
(i) Such Defaulting Lender’s LC Exposure shall be reallocated among the Non-Defaulting Revolving Lenders in
accordance with their respective Revolving Commitment Percentages (but excluding the Revolving Commitments of all the Defaulting Lenders
from both the numerator and the denominator) but only to the extent (x) the sum of all the Outstanding Revolving Credits owed to all Non-
Defaulting Lenders does not exceed the total of all Non-Defaulting Lenders’ Available Revolving Commitments, (y) the representations and
warranties of each Loan Party set forth in the Loan Documents to which it is a party are true and correct at such time, except to the extent that any
such representation and warranty relates to an earlier date (in which case such representation and warranty shall be true and correct as of such
earlier date), and (z) no Default shall have occurred and be continuing at such time;
(ii) If the reallocation described in clause (i) above cannot, or can only partially, be effected, the Borrower shall,
within two Business Days following notice by the Administrative Agent, cash collateralize for the benefit of the Issuing Bank such Defaulting
Lender’s LC Exposure (after giving effect to any partial reallocation pursuant to clause (i) above) for so long as any Letters of Credit are
outstanding;
above, the Borrower shall not be required to pay any fees to such Defaulting Lender pursuant to Section 2.09(b) with respect to such Defaulting
Lender’s LC
(iii) If the Borrower cash collateralizes any portion of such Defaulting Lender’s LC Exposure pursuant clause (ii)
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Exposure during the period such Defaulting Lender’s LC Exposure is cash collateralized by the Borrower;
(iv) If LC Exposures of the Non-Defaulting Lenders are reallocated pursuant to clause (i) above, then the fees
payable to the Revolving Lenders pursuant to Section 2.09(a) and Section 2.09(b) shall be adjusted to reflect such Non-Defaulting Lenders’ LC
Exposure as reallocated; and
(v) If any Defaulting Lender’s LC Exposure is neither cash collateralized nor reallocated pursuant to clauses (i) or
(ii) above, then, without prejudice to any rights or remedies of the Issuing Bank or any Revolving Lender hereunder, all letter of credit fees payable
under Section 2.09(b) with respect to such Defaulting Lender’s LC Exposure shall be payable to the Issuing Bank until such LC Exposure is cash
collateralized and/or reallocated.
(d) So long as such Defaulting Lender is a Defaulting Lender, the Issuing Bank shall not be required to issue, amend or increase any Letter of
Credit, unless it is satisfied that the related LC Exposure will be 100% covered by the Available Revolving Commitments of the Non-Defaulting Lenders
and/or cash collateral will be provided by the Borrower in accordance with Section 2.18(c)(ii), and the participating interests in any such newly issued or
increased Letter of Credit shall be allocated among Non-Defaulting Lenders in a manner consistent with Section 2.18(c)(i) (and such Defaulting Lender shall
not participate therein).
The rights and remedies against a Defaulting Lender under this Agreement are in addition to other rights and remedies that Borrower may have against such
Defaulting Lender with respect to any funding default and that the Administrative Agent or any Lender may have against such Defaulting Lender with respect to any
funding default. In the event that the Administrative Agent, the Borrower and the Issuing Bank each agrees that a Defaulting Lender has adequately remedied all
matters that caused such Lender to be a Defaulting Lender, then the Total Revolving Exposure shall be readjusted to reflect the inclusion of such Lender’s Available
Revolving Commitment and on such date such Lender shall purchase at par such of the Revolving Loans of the other Lenders or take such other actions as the
Administrative Agent may determine to be necessary to cause such outstanding Revolving Loans and funded and unfunded participations in Letters of Credit to be
held on a pro rata basis by the Revolving Lenders (including such Lender) in accordance with their applicable percentages, whereupon such Lender will cease to be a
Defaulting Lender and will be a Non‑Defaulting Lender and any applicable cash collateral shall be promptly returned to the Borrower and any LC Exposure of such
Lender reallocated pursuant to the requirements above shall be reallocated back to such 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 that, except to the extent otherwise expressly
agreed by the affected parties, no change hereunder from Defaulting Lender to Non‑Defaulting Lender will constitute a waiver or release of any claim of any party
hereunder arising from such Lender’s having been a Defaulting Lender.
SECTION 2.19 Extensions of Commitments
(a) Notwithstanding anything to the contrary in this Agreement, pursuant to one or more offers made from time to time by the Borrower to all Lenders of
any Class of Term Loans and/or Revolving Commitments on a pro rata basis (based, in the case of an offer to the Lenders under any Class of Term Loans, on the
aggregate outstanding Term Loans of such Class and, in the case of an offer to the Lenders under any Revolving Facility, on the aggregate outstanding Revolving
Commitments under such Revolving Facility, as applicable), and on the same terms to each such Lender (“ Pro Rata Extension Offers ”), the Borrower is hereby
permitted to consummate
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transactions with individual Lenders that agree to such transactions from time to time to extend the maturity date of such Lender’s Loans and/or Commitments of such
Class and to otherwise modify the terms of such Lender’s Loans and/or Commitments of such Class pursuant to the terms of the relevant Pro Rata Extension Offer
(including, without limitation, increasing the interest rate or fees payable in respect of such Lender’s Loans and/or Commitments and/or modifying the amortization
schedule in respect of such Lender’s Loans). For the avoidance of doubt, the reference to “on the same terms” in the preceding sentence shall mean, (i) in the case of
an offer to the Lenders under any Class of Term Loans, that all of the Term Loans of such Class are offered to be extended for the same amount of time and that the
interest rate changes and fees payable with respect to such extension are the same and (ii) in the case of an offer to the Lenders under any Revolving Facility, that all
of the Revolving Commitments of such Facility are offered to be extended for the same amount of time and that the interest rate changes and fees payable with respect
to such extension are the same. Any such extension (an “ Extension ”) agreed to between the Borrower and any such Lender (an “ Extending Lender ”) will be
established under this Agreement by implementing a Term Loan for such Lender if such Lender is extending an existing Term Loan (such extended Term Loan, an “
Extended Term Loan ”) or an Extended Revolving Commitment for such Lender if such Lender is extending an existing Revolving Commitment (such extended
Revolving Commitment, an “ Extended Revolving Commitment ,” and any Revolving Loan made pursuant to such Extended Revolving Commitment, an “ Extended
Revolving Loan ”). Each Pro Rata Extension Offer shall specify the date on which the Borrower proposes that the Extended Term Loan shall be made or the proposed
Extended Revolving Commitment shall become effective, which shall be a date not earlier than five (5) Business Days after the date on which the Pro Rata Extension
Offer is delivered to the Administrative Agent (or such shorter period agreed to by the Administrative Agent in its reasonable discretion).
(b) The Borrower and each Extending Lender shall execute and deliver to the Administrative Agent an amendment to this Agreement (an “ Extension
Amendment ”) and such other documentation as the Administrative Agent shall reasonably specify to evidence the Extended Term Loans and/or Extended Revolving
Commitments of such Extending Lender. Each Extension Amendment shall specify the terms of the applicable Extended Term Loans and/or Extended Revolving
Commitments; provided , that (i) except as to interest rates, fees and any other pricing terms, and amortization, final maturity date and participation in prepayments
and commitment reductions (which shall be determined by the Borrower and set forth in the Pro Rata Extension Offer), the Extended Term Loans shall, subject to
clauses (ii) and (iii) of this proviso, have (x) the same terms as the existing Class of Term Loans from which they are extended or (y) such other terms as shall be
reasonably satisfactory to the Administrative Agent, (ii) the final maturity date of any Extended Term Loans shall be no earlier than the Latest Maturity Date in effect
on the date of incurrence, (iii) the Weighted Average Life to Maturity of any Extended Term Loans shall be no shorter than the remaining Weighted Average Life to
Maturity of the Class of Term Loans to which such offer relates, (iv) except as to interest rates, fees, any other pricing terms and final maturity (which shall be
determined by the Borrower and set forth in the Pro Rata Extension Offer), any Extended Revolving Commitment shall have (x) the same terms as the existing Class
of Revolving Commitments from which they are extended or (y) have such other terms as shall be reasonably satisfactory to the Administrative Agent and, in respect
of any other terms that would affect the rights or duties of any Issuing Bank, such terms as shall be reasonably satisfactory to such Issuing Bank, and (v) any Extended
Term Loans may participate on a pro rata basis or a less than pro rata basis (but not a greater than pro rata basis) than the Term Loans in any mandatory prepayment
thereunder and (vi) such Extended Term Loans shall not have at any time (x) any financial maintenance covenants of a different type than the financial covenants set
forth in Section 6.10, or any financial maintenance covenants that are more restrictive than the financial covenants set forth in Section 6.10 or (y) negative covenants
and/or default provisions that, taken as a whole, are materially more restrictive than those applicable to the Revolving Facility as determined in good faith by the
Borrower unless, in each case of clauses (x) and (y) such terms (I) (if favorable to all then existing Lenders) are in consultation with the Administrative Agent,
incorporated into this Agreement for the benefit of all then existing Lenders (without further amendment requirements) for so long as any such Extended Term Loans
are outstanding or (II) become applicable
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only after the Revolving Facility shall have matured or been terminated . Upon the effectiveness of any Extension Amendment, this Agreement shall be amended to
the extent (but only to the extent) necessary to reflect the existence and terms of the Extended Term Loans and/or Extended Revolving Commitments evidenced
thereby as provided for in Section 9.02(c). Any such deemed amendment may be memorialized in writing by the Administrative Agent with the Borrower’s consent
(not to be unreasonably withheld) and furnished to the other parties hereto. If provided in any Extension Amendment with respect to any Extended Revolving
Commitments, and with the consent of each Issuing Bank, participations in Letters of Credit shall be reallocated to lenders holding such Extended Revolving
Commitments in the manner specified in such Extension Amendment, including upon effectiveness of such Extended Revolving Commitment or upon or prior to the
maturity date for any Class of Revolving Commitments.
(c) Upon the effectiveness of any such Extension, the applicable Extending Lender’s Term Loan will be automatically designated an Extended Term Loan
and/or such Extending Lender’s Revolving Commitment will be automatically designated an Extended Revolving Commitment. For purposes of this Agreement and
the other Loan Documents, (i) if such Extending Lender is extending a Term Loan, such Extending Lender will be deemed to have a Term Loan having the terms of
such Extended Term Loan and (ii) if such Extending Lender is extending a Revolving Commitment, such Extending Lender will be deemed to have a Revolving
Commitment having the terms of such Extended Revolving Commitment.
(d) Notwithstanding anything to the contrary set forth in this Agreement or any other Loan Document (including without limitation this Section 2.19), (i)
the aggregate amount of Extended Term Loans and Extended Revolving Commitments will not be included in the calculation of clause (a) of the definition of
Incremental Amount, (ii) no Extended Term Loan or Extended Revolving Commitment is required to be in any minimum amount or any minimum increment, (iii) any
Extending Lender may extend all or any portion of its Term Loans and/or Revolving Commitment pursuant to one or more Pro Rata Extension Offers (subject to
applicable proration in the case of over participation) (including the extension of any Extended Term Loan and/or Extended Revolving Commitment), (iv) there shall
be no condition to any Extension of any Loan or Commitment at any time or from time to time other than notice to the Administrative Agent of such Extension and
the terms of the Extended Term Loan or Extended Revolving Commitment implemented thereby, (v) all Extended Term Loans, Extended Revolving Commitments
and all obligations in respect thereof shall be Obligations of the relevant Loan Parties under this Agreement and the other Loan Documents that rank equally and
ratably in right of security with all other Obligations of the Class being extended, (iv) no Issuing Bank shall be obligated to issue Letters of Credit under such
Extended Revolving Commitments unless it shall have consented thereto and (vii) there shall be no borrower (other than the Borrower) and no guarantors (other than
the Guarantors) in respect of any such Extended Term Loans or Extended Revolving Commitments.
(e) Each Extension shall be consummated pursuant to procedures set forth in the associated Pro Rata Extension Offer; provided , that the Borrower shall
cooperate with the Administrative Agent prior to making any Pro Rata Extension Offer to establish reasonable procedures with respect to mechanical provisions
relating to such Extension, including, without limitation, timing, rounding and other adjustments.
SECTION 2.20 Refinancing Amendments .
(a) Notwithstanding anything to the contrary in this Agreement, the Borrower may by written notice to the Administrative Agent establish one or more
additional tranches of term loans under this Agreement (such loans, “ Refinancing Term Loans ”), all proceeds of which are used to refinance in whole or in part any
Class of Term Loans pursuant to Section 2.08(c). Each such notice shall specify the date (each, a “ Refinancing Effective Date ”) on which the Borrower proposes that
the Refinancing Term Loans shall be made, which shall be a date not earlier than
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five (5) Business Days after the date on which such notice is delivered to the Administrative Agent (or such shorter period agreed to by the Administrative Agent in its
sole discretion); provided , that:
(i) before and after giving effect to the Borrowing of such Refinancing Term Loans on the Refinancing Effective Date each of the conditions
set forth in Section 4.02 shall be satisfied;
(ii) the final maturity date of the Refinancing Term Loans shall be no earlier than the maturity date of the refinanced Term Loans;
(iii) the Weighted Average Life to Maturity of such Refinancing Term Loans shall be no shorter than the then-remaining Weighted Average
Life to Maturity of the refinanced Term Loans;
(iv) the aggregate principal amount of the Refinancing Term Loans shall not exceed the outstanding principal amount of the refinanced Term
Loans plus amounts used to pay fees, premiums, costs and expenses (including original issue discount) and accrued interest associated therewith;
(v) all other terms applicable to such Refinancing Term Loans (other than provisions relating to original issue discount, upfront fees, interest
rates and any other pricing terms (optional prepayment or mandatory prepayment or redemption terms shall be as agreed between the Borrower and the
Lenders providing such Refinancing Term Loans) taken as a whole shall (as determined by the Borrower in good faith) be substantially similar to, or no
more restrictive to the Borrower and its Restricted Subsidiaries than, the terms, taken as a whole, applicable to the Term Loans being refinanced (except to
the extent such covenants and other terms apply solely to any period after the Latest Maturity Date or are otherwise reasonably acceptable to the
Administrative Agent);
(vi) there shall be no borrower (other than the Borrower) and no guarantors (other than the Guarantors) in respect of such Refinancing Term
Loans;
(vii) Refinancing Term Loans shall not be secured by any asset of the Borrower and its subsidiaries other than the Collateral; and
(viii) Refinancing Term Loans may participate on a pro rata basis or on a less than pro rata basis (but not on a greater than pro rata basis) in
any mandatory prepayments (other than as provided otherwise in the case of such prepayments pursuant to Section 2.08(c)) hereunder, as specified in the
applicable Refinancing Amendment ; and
(ix) Refinancing Term Loans shall not at any time have (x) any financial maintenance covenants of a different type than the financial
covenants set forth in Section 6.10, or any financial maintenance covenants that are more restrictive than the financial covenants set forth in Section 6.10 or
(y) negative covenants and/or default provisions that, taken as a whole, are materially more restrictive than those applicable to the Revolving Facility as
determined in good faith by the Borrower unless, in each case of clauses (x) and (y) such terms (I) (if favorable to all then existing Lenders) are in
consultation with the Administrative Agent, incorporated into this Agreement for the benefit of all then existing Lenders (without further amendment
requirements) for so long as any such Refinancing Term Loans are outstanding or (II) become applicable only after the Revolving Facility shall have
matured or been terminated .
(b) The Borrower may approach any Lender or any other person that would be a permitted assignee pursuant to Section 9.05 to provide all or a portion of
the Refinancing Term Loans; provided , that any Lender
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offered or approached to provide all or a portion of the Refinancing Term Loans may elect or decline, in its sole discretion, to provide a Refinancing Term Loan. Any
Refinancing Term Loans made on any Refinancing Effective Date shall be designated an additional Class of Term Loans for all purposes of this Agreement; provided
, further , that any Refinancing Term Loans may, to the extent provided in the applicable Refinancing Amendment governing such Refinancing Term Loans, be
designated as an increase in any previously established Class of Term Loans made to the Borrower.
(c) Notwithstanding anything to the contrary in this Agreement, the Borrower may by written notice to the Administrative Agent establish one or more
additional Facilities (“ Replacement Revolving Facilities ”) providing for revolving commitments (“ Replacement Revolving Facility Commitments ” and the
revolving loans thereunder, “ Replacement Revolving Loans ”), which replace in whole or in part any Class of Revolving Commitments under this Agreement. Each
such notice shall specify the date (each, a “ Replacement Revolving Facility Effective Date ”) on which the Borrower proposes that the Replacement Revolving
Facility Commitments shall become effective, which shall be a date not less than five (5) Business Days after the date on which such notice is delivered to the
Administrative Agent (or such shorter period agreed to by the Administrative Agent in its reasonable discretion); provided , that:
(i) before and after giving effect to the establishment of such Replacement Revolving Facility Commitments on the Replacement Revolving
Facility Effective Date, each of the conditions set forth in Section 4.02 shall be satisfied;
(ii) after giving effect to the establishment of any Replacement Revolving Facility Commitments and any concurrent reduction in the
aggregate amount of any other Revolving Facility Commitments, the aggregate amount of Revolving Commitments shall not exceed the aggregate amount of
the Revolving Commitments outstanding immediately prior to the applicable Replacement Revolving Facility Effective Date plus amounts used to pay fees,
premiums, costs and expenses (including original issue discount) and accrued interest associated therewith;
(iii) no Replacement Revolving Facility Commitments shall have a final maturity date (or require commitment reductions or amortizations)
prior to the Revolving Termination Date for the Revolving Commitments being replaced;
(iv) all other terms applicable to such Replacement Revolving Facility (other than provisions relating to (x) fees, interest rates and other
pricing terms and prepayment and commitment reduction and optional redemption terms which shall be as agreed between the Borrower and the Lenders
providing such Replacement Revolving Facility Commitments and (y) the amount of any letter of credit sublimit under such Replacement Revolving
Facility, which shall be as agreed between the Borrower, the Lenders providing such Replacement Revolving Facility Commitments, the Administrative
Agent and the replacement issuing bank, if any, under such Replacement Revolving Facility Commitments) taken as a whole shall (as determined by the
Borrower in good faith) be substantially similar to, or no more restrictive to the Borrower and its Restricted Subsidiaries than, those, taken as a whole,
applicable to the Revolving Commitments so replaced (except to the extent such covenants and other terms apply solely to any period after the Revolving
Termination Date or are otherwise reasonably acceptable to the Administrative Agent);
(v) there shall be no borrower (other than the Borrower) and no guarantors (other than the Guarantors) in respect of such Replacement
Revolving Facility; and
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(vi) Replacement Revolving Facility Commitments and extensions of credit thereunder shall not be secured by any asset of the Borrower and
its subsidiaries other than the Collateral.
In addition, the Borrower may establish Replacement Revolving Facility Commitments to refinance and/or replace all or any portion of a Term Loan hereunder
(regardless of whether such Term Loan is repaid with the proceeds of Replacement Revolving Loans or otherwise), so long as the aggregate amount of such
Replacement Revolving Facility Commitments does not exceed the aggregate amount of Term Loans repaid at the time of establishment thereof plus amounts used to
pay fees, premiums, costs and expenses (including original issue discount) and accrued interest associated therewith (it being understood that such Replacement
Revolving Facility Commitment may be provided by the Lenders holding the Term Loans being repaid and/or by any other person that would be a permitted assignee
hereunder) so long as:
(i) (i) before and after giving effect to the establishment of such Replacement Revolving Facility Commitments on the Replacement
Revolving Facility Effective Date each of the conditions set forth in Section 4.02 shall be satisfied to the extent required by the relevant agreement governing
such Replacement Revolving Facility Commitments,
(ii) (ii) the remaining life to termination of such Replacement Revolving Facility Commitments shall be no shorter than the Weighted
Average Life to Maturity then applicable to the refinanced Term Loans,
maturity date of the refinanced Term Loans,
(iii) the final termination date of the Replacement Revolving Facility Commitments shall be no earlier than the scheduled final
Replacement Revolving Facility; and
(iv) there shall be no borrower (other than the Borrower) and no guarantors (other than the Guarantors) in respect of such
(v) all other terms applicable to such Replacement Revolving Facility (other than provisions relating to (x) fees, interest rates and
other pricing terms and prepayment and commitment reduction and optional redemption terms which shall be as agreed between the Borrower and the
Lenders providing such Replacement Revolving Facility Commitments and (y) the amount of any letter of credit sublimit and swingline commitment under
such Replacement Revolving Facility, which shall be as agreed between the Borrower, the Lenders providing such Replacement Revolving Facility
Commitments, the Administrative Agent and the replacement issuing bank, if any, under such Replacement Revolving Facility Commitments) taken as a
whole shall (as determined by the Borrower in good faith) be substantially similar to, or no more restrictive to the Borrower and its Restricted Subsidiaries
than, those, taken as a whole, applicable to the Term Loans being refinanced (except to the extent such covenants and other terms apply solely to any period
after the latest scheduled final maturity date of any Loans then outstanding or are otherwise reasonably acceptable to the Administrative Agent).
Solely to the extent that an Issuing Bank is not a replacement issuing bank, as the case may be, under a Replacement Revolving Facility, it is understood and agreed
that such Issuing Bank shall not be required to issue any letters of credit under such Replacement Revolving Facility and, to the extent it is necessary for such Issuing
Bank to withdraw as an Issuing Bank, as the case may be, at the time of the establishment of such Replacement Revolving Facility, such withdrawal shall be on terms
and conditions reasonably satisfactory to such Issuing Bank, as the case may be, in its sole discretion. The Borrower agrees to reimburse each Issuing Bank, as the
case may be, in full upon demand, for any reasonable and documented out-of-pocket cost or expense attributable to such withdrawal.
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(d) The Borrower may approach any Lender or any other person that would be a permitted Assignee of a Revolving Facility Commitment pursuant to
Section 9.05 to provide all or a portion of the Replacement Revolving Facility Commitments; provided , that any Lender offered or approached to provide all or a
portion of the Replacement Revolving Facility Commitments may elect or decline, in its sole discretion, to provide a Replacement Revolving Facility Commitment.
Any Replacement Revolving Facility Commitment made on any Replacement Revolving Facility Effective Date shall be designated an additional Class of Revolving
Facility Commitments for all purposes of this Agreement; provided, that any Replacement Revolving Facility Commitments may, to the extent provided in the
applicable Refinancing Amendment, be designated as an increase in any previously established Class of Revolving Facility Commitments.
(e) The Borrower and each Lender providing the applicable Refinancing Term Loans shall execute and deliver to the Administrative Agent an amendment
to this Agreement (a “ Refinancing Amendment ”) and such other documentation as the Administrative Agent shall reasonably specify to evidence such Refinancing
Term Loans and/or Replacement Revolving Facility Commitments. For purposes of this Agreement and the other Loan Documents, (A) if a Lender is providing a
Refinancing Term Loan, such Lender will be deemed to have a Term Loan having the terms of such Refinancing Term Loan and (B) if a Lender is providing a
Replacement Revolving Facility Commitment, such Lender will be deemed to have a Revolving Facility Commitment having the terms of such Replacement
Revolving Facility Commitment. Notwithstanding anything to the contrary set forth in this Agreement or any other Loan Document (including without limitation this
Section 2.20), (i) the aggregate amount of Refinancing Term Loans and Replacement Revolving Facility Commitments will not be included in the calculation of
clause (a) of the definition of Incremental Amount, (ii) no Refinancing Term Loan or Replacement Revolving Facility Commitment is required to be in any minimum
amount or any minimum increment, (iii) there shall be no condition to any incurrence of any Refinancing Term Loan or Replacement Revolving Facility Commitment
at any time or from time to time other than those set forth in clause (a) or (c) above, as applicable and (iv) all Refinancing Term Loans, Replacement Revolving
Facility Commitments and all obligations in respect thereof shall be Obligations under this Agreement and the other Loan Documents that rank equally and ratably in
right of security with the Term Loans and other Obligations.
(f) Each party hereto hereby agrees that, upon the Refinancing Effective Date of any Refinancing Term Loans or Replacement Revolving Facility
Commitments, this Agreement shall be amended to the extent (but only to the extent) necessary to reflect the existence and terms of the Refinancing Term Loans or
Replacement Revolving Facility Commitments evidenced thereby as provided for in Section 9.02. Any amendment to this Agreement or any other Loan Document
that is necessary to effect the provisions of this Section 2.20 (including, without limitation, to provide for the establishment of Incremental Term Loans) and any such
collateral and other documentation shall be deemed “Loan Documents” hereunder and may be memorialized in writing between the Administrative Agent and the
Borrower and furnished to the other parties hereto.
(g) No term loan established and outstanding under this Agreement pursuant to (i) any of Sections 2.02, 2.19 or 2.20 or (ii) an agreement or agreements in
writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with the consent of the Required Lenders shall at any
time have (x) any financial maintenance covenants of a different type than the financial covenants set forth in Section 6.10, or any financial maintenance covenants
that are more restrictive than the financial covenants set forth in Section 6.10 or (y) have negative covenants and/or default provisions that, taken as a whole, are
materially more restrictive than those applicable to the Revolving Facility as determined in good faith by the Borrower unless, in each case of clauses (x) and (y) such
terms (I) (if favorable to all then existing Lenders) are in consultation with the Administrative Agent, incorporated into this Agreement for the benefit of all then
existing Lenders (without further amendment requirements) for so long as any such term loans are outstanding or (II) become applicable only after the
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Revolving Facility shall have matured or been terminated. This Section 2.20(g) shall not be waived, amended, amended and restated or modified except pursuant to an
agreement or agreements in writing entered into by the Borrower and the Required Revolving Lenders or by the Borrower and the Administrative Agent with the
consent of the Required Revolving Lenders.
SECTION 2.21 Loan Repurchases .
(a) Subject to the terms and conditions set forth or referred to below, the Borrower may from time to time, at its discretion, conduct modified Dutch
auctions in order to purchase its Term Loans of one or more Classes (as determined by the Borrower) (each, a “ Purchase Offer ”), each such Purchase Offer to be
managed exclusively by the Administrative Agent (or such other financial institution chosen by the Borrower and reasonably acceptable to the Administrative Agent)
(in such capacity, the “ Auction Manager ”), so long as the following conditions are satisfied:
(i) each Purchase Offer shall be conducted in accordance with the procedures, terms and conditions set forth in this Section 2.21 and the
Auction Procedures;
(ii) no Default or Event of Default shall have occurred and be continuing on the date of the delivery of each notice of an auction and at the
time of (and immediately after giving effect to) the purchase of any Term Loans in connection with any Purchase Offer;
(iii) the principal amount (calculated on the face amount thereof) of each and all Classes of Term Loans that the Borrower offers to purchase in
any such Purchase Offer shall be no less than $25,000,000 (unless another amount is agreed to by the Administrative Agent) (across all such Classes);
(iv) the aggregate principal amount (calculated on the face amount thereof) of all Term Loans of the applicable Class or Classes so purchased
by the Borrower shall automatically be cancelled and retired by the Borrower on the settlement date of the relevant purchase (and may not be resold)
(without any increase to Consolidated EBITDA as a result of any gains associated with cancellation of debt), and in no event shall the Borrower be entitled
to any vote hereunder in connection with such Term Loans;
(v) no more than one Purchase Offer with respect to any Class may be ongoing at any one time;
(vi) the Borrower represents and warrants that no Loan Party shall have any material non-public information with respect to the Loan Parties
or their subsidiaries, or with respect to the Loans or the securities of any such person, that (A) has not been previously disclosed in writing to the
Administrative Agent and the Lenders (other than because such Lender does not wish to receive such material non-public information) prior to such time and
(B) could reasonably be expected to have a material effect upon, or otherwise be material to, a Lender’s decision to participate in the Purchase Offer;
(vii) at the time of each purchase of Term Loans through a Purchase Offer, the Borrower shall have delivered to the Auction Manager an
officer’s certificate of an officer certifying as to compliance with the preceding clause (vi);
(viii) any Purchase Offer with respect to any Class shall be offered to all Term Lenders holding Term Loans of such Class on a pro rata basis;
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(ix) no purchase of any Term Loans shall be made from the proceeds of any Revolving Facility Loan; and
(x) the Borrower is in Pro Forma Compliance with the financial covenant set forth in Section 6.10.
(b) The Borrower must terminate any Purchase Offer if it fails to satisfy one or more of the conditions set forth above which are required to be met at the
time which otherwise would have been the time of purchase of Term Loans pursuant to such Purchase Offer. If the Borrower commences any Purchase Offer (and all
relevant requirements set forth above which are required to be satisfied at the time of the commencement of such Purchase Offer have in fact been satisfied), and if at
such time of commencement the Borrower reasonably believes that all required conditions set forth above which are required to be satisfied at the time of the
consummation of such Purchase Offer shall be satisfied, then the Borrower shall have no liability to any Lender for any termination of such Purchase Offer as a result
of its failure to satisfy one or more of the conditions set forth above which are required to be met at the time which otherwise would have been the time of
consummation of such Purchase Offer, and any such failure shall not result in any Default or Event of Default hereunder. With respect to all purchases of Term Loans
of any Class or Classes made by the Borrower pursuant to this Section 2.21, (x) the Borrower shall pay on the settlement date of each such purchase all accrued and
unpaid interest (except to the extent otherwise set forth in the relevant offering documents), if any, on the purchased Term Loans of the applicable Class or Classes up
to the settlement date of such purchase and (y) such purchases (and the payments made by the Borrower and the cancellation of the purchased Loans, in each case in
connection therewith) shall not constitute voluntary or mandatory payments or prepayments for purposes of Section 2.08 hereof.
(c) The Administrative Agent and the Lenders hereby consent to the Purchase Offers and the other transactions effected pursuant to and in accordance with
the terms of this Section 2.21; provided , that notwithstanding anything to the contrary contained herein, no Lender shall have an obligation to participate in any such
Purchase Offer. For the avoidance of doubt, it is understood and agreed that the provisions of Sections 2.13, 2.15 and 9.05 will not apply to the purchases of Term
Loans pursuant to Purchase Offers made pursuant to and in accordance with the provisions of this Section 2.21. The Auction Manager acting in its capacity as such
hereunder shall be entitled to the benefits of the provisions of Article VIII and Section 9.04 to the same extent as if each reference therein to the “Agents” were a
reference to the Auction Manager, and the Administrative Agent shall cooperate with the Auction Manager as reasonably requested by the Auction Manager in order
to enable it to perform its responsibilities and duties in connection with each Purchase Offer.
The Borrower represents and warrants to the Lenders that:
ARTICLE III
Representations and Warranties
SECTION 3.01 Organization; Powers . Each of the Borrower and its Material Subsidiaries is duly organized, validly existing and, if applicable, in good
standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and is qualified to do
business in, and is in good standing in, every jurisdiction where such qualification is required, except, in each case, where the failure to do so, individually or in the
aggregate, would not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.02 Authorization; Enforceability . The Transactions (excluding use of proceeds) are within the corporate or other organizational powers of the
Loan Parties and have been duly authorized by all necessary corporate or other organizational action. This Agreement has been and each other Loan Document will be
duly
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executed and delivered by each Loan Party party thereto. This Agreement constitutes, and each other Loan Document when executed and delivered will constitute a
legal, valid and binding obligation of each Loan Party party thereto, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors’ rights or remedies generally and subject to general principles of equity, regardless of whether considered
in a proceeding in equity or at law.
SECTION 3.03 Governmental Approvals; No Conflicts . The Transactions (excluding use of proceeds) (a) do not require any consent or approval of,
registration or filing with, or any other action by, any Governmental Authority, except (i) such as have been obtained or made and are in full force and effect or those
which the failure to obtain would not be reasonably expected to result in a Material Adverse Effect and (ii) the filings referred to in Section 3.12, (b) will not violate
any applicable law or regulation or the charter, by-laws or other organizational documents of the Borrower or any other Loan Party or any order of any Governmental
Authority except where any such violation would not reasonably expected to result in a Material Adverse Effect, (c) will not violate or result in a default under any
indenture, agreement or other instrument binding upon the Borrower or any other Loan Party or its assets except as would not reasonably expected to result in a
Material Adverse Effect, and (d) will not result in the creation or imposition of any Lien on any asset of the Borrower or any of its Material Subsidiaries (other than
any Permitted Lien).
SECTION 3.04 Financial Position . The Borrower has heretofore furnished to the Lenders its consolidated balance sheet and statements of income,
stockholders’ equity and cash flows as of and for (a) the fiscal years ended December 31, 2014 and 2013 reported on by Ernst & Young LLP, independent public
accountants and (b) the six months ended June 30, 2015. Such financial statements present fairly, in all material respects, the financial position and results of
operations and cash flows of the Borrower and its consolidated subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year‑end audit
adjustments and the absence of footnotes in the case of the statements referred to in clause (b) above.
SECTION 3.05 Properties .
(a) Each of the Borrower and its Material Subsidiaries has good title to, or valid leasehold interests in, all its real and personal property material to its
business, except for minor defects in title and Permitted Liens that do not interfere with its ability to conduct its business as currently conducted or to utilize such
properties for their intended purposes or as, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
(b) Each of the Borrower and its Material Subsidiaries owns, or is validity licensed to use, all Intellectual Property used or held for use by such entities or
necessary to operate their respective business as currently conducted and contemplated to be conducted, and the operation of their respective businesses by the
Borrower and its Material Subsidiaries does not infringe upon or otherwise violate the rights of any other Person, except for any such Intellectual Property or
infringements or violations that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.06 Litigation and Environmental Matters .
(a) There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the Borrower,
threatened in writing against or affecting the Borrower or any of its Restricted Subsidiaries (i) that would reasonably be expected, individually or in the aggregate, to
result in a Material Adverse Effect (other than the Disclosed Matters) or (ii) on the Closing Date, that involve this Agreement or the Transactions (excluding use of
proceeds).
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(b) Except for the Disclosed Matters and except with respect to any other matters that, individually or in the aggregate, would not reasonably be expected
to result in a Material Adverse Effect, neither the Borrower nor any of its Restricted Subsidiaries (i) has failed to comply with any Environmental Law or to obtain,
maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii)
has received written notice of any claim with respect to any Environmental Liability or (iv) knows of any basis reasonably likely to result in Environmental Liability.
SECTION 3.07 Compliance with Laws and Agreements . Each of the Borrower and its Material Subsidiaries is in compliance with all laws, regulations
and orders of any Governmental Authority applicable to it or its property and all indentures, agreements and other instruments binding upon it or its property, except
where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. No Default has occurred and is
continuing.
SECTION 3.08 Investment Company Status . No Loan Party is an “investment company” as defined in, or subject to regulation under, the Investment
Company Act of 1940. No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations T, U and X.
SECTION 3.09 Taxes . Each of the Borrower and its Material Subsidiaries has timely filed or caused to be filed all Tax returns and reports required to
have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate
proceedings and for which the Borrower or such Material Subsidiary, as applicable, has set aside on its books adequate reserves in accordance with GAAP or (b) to
the extent that the failure to do so would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect.
SECTION 3.10 ERISA . No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events for
which liability is reasonably expected to occur, would reasonably be expected to result in a Material Adverse Effect. The present value of all accumulated benefit
obligations under each Plan (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed the fair market value of the assets of such Plan by an amount which, if it were to become due, would cause
a Material Adverse Effect.
SECTION 3.11 Disclosure . To the best of the Borrower’s knowledge, neither the Lender Presentation Presentations, the CIM, nor any of the other reports,
financial statements, certificates or other written information furnished by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with
the negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished), taken as a whole, contained any material
misstatement of fact or omitted to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not
misleading as of the date furnished; provided that with respect to projected financial information, the Borrower represents only that such information was prepared in
good faith based upon assumptions believed to be reasonable at the time.
SECTION 3.12 Pledge Agreement . The Pledge Agreement will (to the extent required thereby) create in favor of the Collateral Agent, for the benefit of
the Lenders, a security interest in the Collateral described therein (subject to any limitations specified therein). In the case of the certificated pledged stock
constituting securities described in Section 5.09(a) as of the Closing Date, when stock certificates representing such pledged stock are delivered to the Collateral
Agent (together with a properly completed and signed stock power or endorsement), and
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in the case of the other Collateral described in the Pledge Agreement as of the Closing Date, when financing statements specified on Schedule 3.12 in appropriate
form are filed in the offices specified on Schedule 3.12, the Collateral Agent shall have a perfected Lien on, and security interest in, all right, title and interest of the
Loan Parties in such Collateral (subject to any limitations specified therein) to the extent perfection of such security interest can be perfected by control of securities
or the filing of a financing statement, as security for the Obligations, in each case prior and superior in right to any other Person (except Permitted Liens).
SECTION 3.13 No Change . Since December 31, 2014, there has been no event that has had or would reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.
SECTION 3.14 Guarantors . Set forth on Schedule 3.14 is a list of all Subsidiary Guarantors and IAC Guarantors on the Closing Term B-1 Effective Date,
together with the jurisdiction of organization, and ownership and ownership percentages of Equity Interests held by each such Subsidiary Guarantor and IAC
Guarantor in each direct subsidiary of such Subsidiary Guarantor and IAC Guarantor as of the Closing Term B-1 Effective Date.
SECTION 3.15 Solvency . Immediately after the consummation of the Transactions to occur on the Closing Date, including the making of each Loan to be
made on the Closing Date and the application of the proceeds of such Loans, and after giving effect to the rights of subrogation and contribution under the Guarantee
Agreement, (a) the fair value of the assets of the Borrower and its subsidiaries on a consolidated basis will exceed their debts and liabilities, subordinated, contingent
or otherwise, (b) the present fair saleable value of the assets of the Borrower and its subsidiaries on a consolidated basis will be greater than the amount that will be
required to pay the probable liability on their debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and
matured, (c) the Borrower and its subsidiaries on a consolidated basis will be able to pay their debts and liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured and (d) the Borrower and its subsidiaries on a consolidated basis will not have unreasonably small capital with
which to conduct the business in which they are engaged, as such business is now conducted and is proposed to be conducted following the Closing Date.
SECTION 3.16 No Default . No Default or Event of Default has occurred and is continuing.
SECTION 3.17 Anti-Corruption Laws and Sanctions . The Borrower has implemented and maintains in effect policies and procedures designed to ensure
compliance by the Borrower, its subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions, and the
Borrower and its subsidiaries and to their knowledge their respective officers, directors and employees are in compliance with Anti-Corruption Laws and applicable
Sanctions in all material respects. None of (a) the Borrower or any subsidiary or (b) to the knowledge of the Borrower, any director, officer or employee of the
Borrower or any subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person. No proceeds
of the Loans and no Letter of Credit shall be used by the Borrower in violation of any Anti-Corruption Law or applicable Sanctions. No representation is made under
this Section 3.17 with respect to any of the end-user individuals of the internet services.
SECTION 4.01 Closing Date . The obligations of the Lenders to make the initial Loans hereunder shall not become effective until the date on which each
of the following conditions is satisfied (or waived in accordance with Section 9.02):
ARTICLE IV
Conditions
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(a) The Administrative Agent (or its counsel) shall have received (including by telecopy or email transmission) from each Loan Party party to the
relevant Loan Document, a counterpart of such Loan Document signed on behalf of such Loan Party.
(b) The Administrative Agent shall have received a favorable written opinion (addressed to the Administrative Agent and the Lenders as of the
Closing Date and dated the Closing Date) of (i) Wachtell, Lipton, Rosen & Katz, counsel for the Borrower and certain of the Loan Parties and (ii) local
counsel in each jurisdiction in which a Loan Party is organized and the laws of which are not covered by the opinion referred to in (i) above, in each case in
form and substance reasonably satisfactory to the Administrative Agent and its counsel.
(c) The Administrative Agent shall have received such documents and certificates as the Administrative Agent or its counsel may reasonably
request relating to the organization, existence and good standing of the Loan Parties, the authorization of the Transactions (excluding use of proceeds) and
any other legal matters relating to the Loan Parties, this Agreement or the Transactions (excluding use of proceeds), including a certificate of each Loan
Party substantially in the form of Exhibit E , all in form and substance reasonably satisfactory to the Administrative Agent and its counsel.
(d) The Administrative Agent shall have received a certificate, dated the Closing Date and signed by the Chief Executive Officer, a Vice
President, a Financial Officer of the Borrower or any other executive officer of the Borrower who has specific knowledge of the Borrower’s financial matters
and is satisfactory to the Administrative Agent, confirming that (a) the representations and warranties of each Loan Party set forth in the Loan Documents are
true and correct as of the Closing Date and (b) as of the Closing Date, no Default has occurred and is continuing.
(e) There shall have been delivered to the Administrative Agent an executed Perfection Certificate.
(f) The Administrative Agent shall have received a solvency certificate in the form of Exhibit I, dated the Closing Date and signed by the chief
financial officer of the Borrower.
(g) The Administrative Agent, the Lead Arrangers and the Lenders shall have received all fees and other amounts due and payable on or prior to
the Closing Date, including, to the extent invoiced, reimbursement or payment of all out‑of‑pocket expenses (including fees of legal counsel to the
Administrative Agent, the Lead Arrangers and the Lenders) required to be reimbursed or paid by the Borrower hereunder.
(h) Since December 31, 2014, there shall have been no event that has had or would reasonably be expected to have a Material Adverse Effect.
(i) The Administrative Agent shall have received the results of a recent Lien search with respect to each Loan Party, and such search shall reveal
no Liens on any of the assets of the Loan Parties except for Liens permitted by Section 6.02 or discharged on or prior to the Closing Date pursuant to
documentation satisfactory to the Administrative Agent.
(j) Other than the items set forth on Schedule 5.10, the Collateral Agent shall have received the certificates representing the certificated Equity
Interests pledged pursuant to the Pledge Agreement, together with an undated stock power for each such certificate executed in blank by a duly authorized
officer of the pledgor thereof.
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(k) Each Uniform Commercial Code financing statement or other filing required by the Pledge Agreement shall be in proper form for filing.
(l) Each Loan Party shall have provided the documentation and other information requested by the Lenders that is required by regulatory
authorities under applicable “know your customer” and anti-money-laundering rules and regulations, including without limitation, the Act, in each case as
requested at least three Business Days prior to the Closing Date.
(m) The Administrative Agent shall have received an executed promissory note payable to the order of each Lender that requested such
promissory note at least one Business Day prior to the Closing Date (or, if requested by such Lender, to such Lender and its registered assigns) and in a form
approved by the Administrative Agent.
(n) The Borrower shall have paid as of the Closing Date immediately after giving effect thereto to the Administrative Agent for the account of
each of the Revolving Lenders, an upfront fee as separately agreed.
(o) The Administrative Agent shall have received copies of the UCC-3s set forth on Schedule 4.01.
(p) The entry into and effectiveness of the IAC Credit Agreement shall have occurred substantially concurrently with the effectiveness of this
Agreement.
The Administrative Agent shall notify the Borrower and the Lenders of the Closing Date, and such notice shall be conclusive and binding.
SECTION 4.02 Each Credit Event . The obligation of each Lender to make a Loan on the occasion of any Borrowing (other than a continuation or
conversion of an existing Borrowing) and the obligation of the Issuing Bank to issue any Letter of Credit is subject to the satisfaction of the following conditions:
(a) The representations and warranties of each Loan Party set forth in this Agreement shall be true and correct in all material respects (except to
the extent that any such representation and warranty is qualified by materiality or Material Adverse Effect, in which case such representation and warranty
shall be true and correct in all respects) on and as of the date of such Borrowing, except to the extent that any such representation and warranty relates to an
earlier date (in which case such representation and warranty shall have been true and correct in all material respects (except to the extent that any such
representation and warranty is qualified by materiality or Material Adverse Effect, in which case such representation and warranty shall be true and correct in
all respects) as of such earlier date); provided that in the case of any Incremental Term Facility used to finance an acquisition permitted hereunder, to the
extent the Lenders participating in such Incremental Term Facility agree, this Section 4.02(a) shall require only customary “specified representations” and
“acquisition agreement representations” (i.e., those representations of the seller or the target (as applicable) in the applicable acquisition agreement that are
material to the interests of the Lenders and only to the extent that the Borrower or its applicable subsidiary has the right to terminate its obligations under the
applicable acquisition agreement as a result of the failure of such representations to be accurate) be true and correct in all material respects (except to the
extent that any such representation and warranty is qualified by materiality or Material Adverse Effect, in which case such representation and warranty shall
be true and correct in all respects).
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(b) At the time of and immediately after giving effect to such Borrowing, no Default or Event of Default shall have occurred and be continuing.
(c) The Administrative Agent or Issuing Bank shall have received a borrowing notice in accordance with Section 2.03 or a Letter of Credit
request in accordance with Section 2.17(b), as applicable.
Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower or other applicable Loan Party on the date thereof as to the matters
specified in paragraphs (a) and (b) of this Section.
ARTICLE V
Affirmative Covenants
Until the Revolving Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full and all Letters of Credit have expired or been cash collateralized, the Borrower covenants and agrees with the Lenders that:
SECTION 5.01 Financial Statements; Other Information . The Borrower will furnish to the Administrative Agent and each Lender:
(a) within 90 days after the end of each fiscal year of the Borrower, its audited consolidated balance sheet and related statements of operations,
stockholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the previous fiscal year,
all reported on by Ernst & Young LLP or other independent public accountants of recognized national standing (without a “going concern” or like
qualification or exception and without any qualification or exception as to the scope of such audit except as to the effectiveness of internal control over
financial reporting with respect to any subsidiary acquired during such fiscal year in accordance with Regulation S-X under the Exchange Act, as interpreted
by the implementation guidance of the U.S. Securities Exchange Commission) to the effect that such consolidated financial statements present fairly in all
material respects the financial position and results of operations of the Borrower and its consolidated subsidiaries on a consolidated basis in accordance with
GAAP consistently applied (except as approved by such accountants and disclosed therein), and a schedule eliminating Unrestricted Subsidiaries and
reconciling to the financial statements in reasonable detail, as determined by the Borrower;
(b) within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower, its consolidated balance sheet and
related statement of operations as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year and the statements of stockholders’
equity and cash flows for the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial Officers as presenting fairly in all
material respects the financial position and results of operations of the Borrower and its consolidated subsidiaries on a consolidated basis in accordance with
GAAP consistently applied (except as approved by such officer and disclosed therein), subject to normal year-end audit adjustments and the absence of
footnotes, and a schedule eliminating Unrestricted Subsidiaries and reconciling to the financial statements;
(c) within 90 days after the end of each fiscal year of the Borrower, forecasts of the cash and cash equivalents and long-term debt line items on
the consolidated balance sheets and forecasts of the statements of operations and cash flows, in each case of the Borrower and the Restricted Subsidiaries on
a quarterly basis for the then current fiscal year, in each case prepared by management of Borrower and
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substantially in the form as the forecasts delivered by the Borrower to the Lead Arrangers prior to the Closing Date;
(d) concurrently with any delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer of the Borrower (i)
certifying as to whether a Default has occurred and, if a Default has occurred, specifying the details thereof and any action taken or proposed to be taken with
respect thereto, (ii) setting forth reasonably detailed calculations demonstrating compliance with Section 6.10, (iii) stating whether any change in GAAP or
in the application thereof that materially affects such financial statements has occurred since the date of the audited financial statements referred to in Section
3.04 and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such certificate, (iv) setting forth a
description of any change in the jurisdiction of organization of the Borrower or any Material Domestic Subsidiary since the date of the most recent certificate
delivered pursuant to this paragraph (d) (or, in the case of the first such certificate so delivered, since the Closing Date) and (v) setting forth a calculation in
reasonable detail indicating which Domestic Subsidiaries are Material Domestic Subsidiaries;
(e) concurrently with any delivery of financial statements under clause (a) above, a certificate of the accounting firm that reported on such
financial statements stating whether they obtained knowledge during the course of their examination of such financial statements of any Default (which
certificate may be limited to the extent required by accounting rules or guidelines and may be limited to accounting matters and disclaim responsibility for
legal interpretations);
(f) promptly following receipt thereof, copies of any documents described in Section 101(k) or 101(l) of ERISA that the Borrower or any ERISA
Affiliate may request with respect to any Multiemployer Plan; provided that if the Borrower and/or any ERISA Affiliate has not requested such documents or
notices from the administrator or sponsor of the applicable Multiemployer Plan then, upon reasonable request of the Administrative Agent, the Borrower
and/or its ERISA Affiliates shall promptly make a request for such documents or notices from such administrator or sponsor and the Borrower shall provide
copies of such documents and notices to the Administrative Agent (on behalf of each requesting Lender) promptly after receipt thereof; and
(g) promptly following any reasonable request therefor, such other information regarding the operations, business affairs and financial position of
the Borrower or any Restricted Subsidiary, or compliance with the terms of this Agreement, as the Administrative Agent (on its own behalf or at the request
of any Lender) may reasonably request.
Information required to be delivered pursuant to this Section 5.01 shall be deemed to have been delivered if such information (including, in the case of certifications
required pursuant to clause (b) above, the certifications accompanying any such quarterly report pursuant to Section 302 of the Sarbanes-Oxley Act of 2002), or one
or more annual or quarterly reports containing such information, shall have been posted by the Administrative Agent on IntraLinks or a similar site to which the
Lenders have been granted access or shall be available on the website of the SEC at http://www.sec.gov; provided that the Borrower shall notify (which may be by
facsimile or electronic mail) the Administrative Agent of the posting of such documents and provide to the Administrative Agent by electronic mail electronic
versions (i.e. soft copies) of such documents. Information required to be delivered pursuant to this Section 5.01 may also be delivered by electronic communications
pursuant to procedures approved by the Administrative Agent. In the event any financial statements delivered under clause (a) or (b) above shall be restated, the
Borrower shall deliver, promptly after such restated financial statements become available, revised completed
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certificates with respect to the periods covered thereby that give effect to such restatement, signed by a Financial Officer.
The Borrower acknowledges and agrees that all financial statements furnished pursuant to paragraphs (a) and (b) above are hereby deemed to be Borrower Materials
suitable for distribution, and to be made available, to Public Lenders as contemplated by Section 9.18 and may be treated by the Administrative Agent and the Lenders
as if the same had been marked “PUBLIC” in accordance with such paragraph (unless the Borrower otherwise notifies the Administrative Agent in writing on or prior
to delivery thereof).
SECTION 5.02 Notices of Material Events . The Borrower will furnish to the Administrative Agent for delivery to each Lender prompt written notice of
the following:
(a) the occurrence of any Default;
(b) the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against the Borrower or
any Restricted Subsidiary thereof as to which there is a reasonable likelihood of an adverse determination that would reasonably be expected to result in a
Material Adverse Effect;
(c) the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, would reasonably be expected to
result in liability of the Borrower or its Restricted Subsidiaries in an amount which would constitute a Material Adverse Effect; and
(d) any other development that results in, or would reasonably be expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer or other executive officer of the Borrower setting forth
the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.
SECTION 5.03 Existence; Conduct of Business . The Borrower will, and will cause each of its Restricted Subsidiaries to, do or cause to be done all things
necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges and franchises material to the conduct of
its business except in each case (i) where the failure to do so would not reasonably be expected to result in a Material Adverse Effect or (ii) as such action is not
prohibited under Sections 6.03, 6.04 or 6.05.
SECTION 5.04 Payment of Obligations . The Borrower will, and will cause each of its Restricted Subsidiaries to, pay its obligations, including Tax
liabilities, that, if not paid, would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such
Restricted Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (c) the failure to make payment pending such
contest would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect.
SECTION 5.05 Maintenance of Properties; Insurance . The Borrower will, and will cause each of its Restricted Subsidiaries to (a) keep and maintain all
property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted, (b) maintain, with financially sound and
reputable insurance companies or in accordance with acceptable self insurance practices, insurance in such amounts and against such risks as are customarily
maintained by companies of similar size engaged in the same or similar businesses operating
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in the same or similar locations, and (c) and use commercially reasonable efforts to maintain, prosecute and enforce its material Intellectual Property, in each case
except where the failure to do so would not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.06 Books and Records; Inspection Rights . The Borrower will, and will cause each of its Restricted Subsidiaries to, keep proper books of
record and account in which full, true and correct entries in all material respects are made of all dealings and transactions in relation to its business and activities. The
Borrower will, and will cause each of its Restricted Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender to visit and
inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and independent
accountants all at such reasonable times and as often as reasonably requested, provided that such visits, inspections, examinations and discussions shall, so long as no
Default or Event of Default has occurred and is continuing, take place no more often than one time per fiscal year on a date to be determined by, and shall be
coordinated by, the Borrower and the Administrative Agent.
SECTION 5.07 Compliance with Laws . The Borrower will, and will cause each of its Restricted Subsidiaries to, comply with all laws, rules, regulations
and orders of any Governmental Authority applicable to it or its property, except where the failure to do so, individually or in the aggregate, would not reasonably be
expected to result in a Material Adverse Effect.
SECTION 5.08 Use of Proceeds . The proceeds of the Loans will be used only to finance the general corporate purposes of the Borrower and its Restricted
Subsidiaries, including to fund dividends and other distributions to IAC.
SECTION 5.09 Guarantors and Collateral .
(a) On the Closing Date (or such longer period as the Collateral Agent may agree in its sole discretion) each Restricted Subsidiary (other than an Excluded
Subsidiary) will (A) become a party to the Guarantee Agreement and (B) become a party to the Pledge Agreement and pledge all of the Equity Interests of any
Restricted Subsidiary (other than Excluded Equity Interests) directly owned by such Restricted Subsidiary and any other shares, stock certificates, options, interests or
rights of any nature whatsoever in respect of the Equity Interests of any Restricted Subsidiary (other than Excluded Equity Interests) that may be issued or granted to,
or held by, such Restricted Subsidiary while this Agreement is in effect; provided that such Restricted Subsidiary shall not be required to take any action (including
entry into any foreign pledge agreement or similar document) other than those actions expressly set forth in this clause (B) and deliver to the Collateral Agent any and
all certificates representing such Equity Interests (to the extent certificated), accompanied by undated stock powers or other appropriate instruments of transfer
executed in blank.
(b) With respect to any Person that becomes a Restricted Subsidiary (other than an Excluded Subsidiary) after the Closing Date, or any Excluded
Subsidiary that ceases to constitute an Excluded Subsidiary after the Closing Date, the Borrower will, within 30 days thereafter (or such longer period as the Collateral
Agent may agree in its sole discretion) (i) cause such Restricted Subsidiary to (A) become a party to the Guarantee Agreement, (B) become a party to the Pledge
Agreement or such other Collateral Document as may be reasonably requested by the Collateral Agent, (C) pledge all of the Equity Interests of any Restricted
Subsidiary (other than Excluded Equity Interests) directly owned by such Restricted Subsidiary and any other shares, stock certificates, options, interests or rights of
any nature whatsoever in respect of the Equity Interests of any Restricted Subsidiary (other than Excluded Equity Interests) that may be issued or granted to, or held
by, such Restricted Subsidiary while this Agreement is in effect, (D) deliver to the Collateral Agent any and all certificates representing such Equity Interests (to the
extent
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certificated), accompanied by undated stock powers or other appropriate instruments of transfer executed in blank and (E) deliver to the Administrative Agent a
certificate of such Restricted Subsidiary substantially in the form of Exhibit E, with appropriate insertions and attachments, and (ii) if requested by the Administrative
Agent, deliver to the Administrative Agent one or more legal opinions relating to the matters described above, which shall be in form and substance, and from
counsel, reasonably satisfactory to the Administrative Agent.
(c) On and after the Closing Date until the Separation Date, each member of the IAC Group that is a borrower or guarantor under the IAC Credit
Agreement shall be a party to the Guarantee Agreement and deliver to the Administrative Agent a certificate of such member of the IAC Group, substantially in the
form of Exhibit E, with appropriate insertions and attachments. During the Shared Collateral Period, if any, in each case with respect to the Equity Interests in any
member of the IAC Group that are or become pledged to the IAC Facility Collateral Agent for the benefit of the secured parties under the IAC Credit Agreement,
each member of the IAC Group shall, on the first day of the Shared Collateral Period (or, if later, on the date such Equity Interests are pledged to the IAC Facility
Collateral Agent) (i) cause any such member of the IAC Group that owns such Equity Interests to (A) become a party to the Pledge Agreement or such other
Collateral Document as may be reasonably requested by the Collateral Agent, (B) pledge all of such Equity Interests and any other shares, stock certificates, options,
interests or rights of any nature whatsoever in respect of such Equity Interests (to the extent pledged under the IAC Credit Agreement) that may be issued or granted
to, or held by, such member of the IAC Group while this Agreement is in effect and (C) deliver to the Collateral Agent (or to the IAC Facility Collateral Agent as its
bailee) any and all certificates representing such Equity Interests (to the extent certificated), accompanied by undated stock powers or other appropriate instruments of
transfer executed in blank, and (ii) if requested by the Administrative Agent, deliver to the Administrative Agent one or more legal opinions relating to the matters
described in this clause (c), which shall cover matters, and be in a form, substantially the same as previously provided to the Administrative Agent under Section
4.01(b) to the extent applicable from Wachtell, Lipton, Rosen & Katz or such other counsel, reasonably satisfactory to the Administrative Agent. At the time of the
initial pledge pursuant to this Section 5.09(c), the Administrative Agent shall have received executed counterparts of the Pari Passu Intercreditor Agreement
substantially simultaneously therewith.
SECTION 5.10 Post-Closing Delivery of Certificated Equity Interests . Within 30 days of the Closing Date (or such later date as the Administrative Agent
may reasonably agree), to the extent not previously delivered, the Borrower agrees that it will deliver to the Collateral Agent the certificates representing the
certificated Equity Interests pledged pursuant to the Pledge Agreement listed on Schedule 5.10, together with an undated stock power for each such certificate
executed in blank by a duly authorized officer of the pledgor thereof.
SECTION 5.11 Further Assurances . Promptly upon the reasonable request by the Administrative Agent, or any Lender through the Administrative Agent,
the Borrower shall, shall cause the Subsidiary Guarantors to , and shall use commercially reasonable efforts to cause the IAC Guarantors, as applicable, to (a) correct
any material defect or error that may be discovered in the execution, acknowledgment, filing or recordation of any Loan Document, 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 any Lender through the Administrative Agent, may reasonably require from time to time in order to (i) carry out the purposes of the Loan Documents, (ii) to
the fullest extent permitted by applicable law, subject any Loan Party’s Equity Interests to the Liens granted by the Pledge Agreement to the extent required
thereunder and (iii) perfect and maintain the validity, effectiveness and priority of the Pledge Agreement and any of the Liens created thereunder.
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SECTION 5.01 Ratings. The Borrower shall use commercially reasonable efforts to obtain and to maintain public ratings from Moody’s and Standard &
Poor’s for the Term B-1 Loans; provided, however, that the Borrower shall not be required to obtain or maintain any specific rating.
ARTICLE VI
Negative Covenants
Until the Revolving Commitments have expired or terminated and the principal of and interest on each Loan and all fees payable hereunder have been paid
in full and all Letters of Credit have expired or have been cash collateralized, the Borrower covenants and agrees with the Lenders that:
SECTION 6.01 Indebtedness . The Borrower will not, and will not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any
Indebtedness, except:
(a) Indebtedness incurred under the Loan Documents;
(b) Indebtedness in respect of the Senior Notes and Permitted Ratio Debt and any Refinancing Indebtedness thereof;
(c) (i) Indebtedness of the Borrower or any other subsidiary incurred to finance the acquisition, construction or improvement of any fixed or
capital assets, including Capital Lease Obligations, and any Indebtedness assumed in connection with the acquisition of any such assets ( provided that such
Indebtedness is incurred or assumed prior to or within 90 days after such acquisition or the completion of such construction or improvement and the principal
amount of such Indebtedness does not exceed the cost of acquiring, constructing or improving such fixed or capital assets) in an aggregate amount under this
clause (c) not to exceed the greater of $50,000,000 and 2.0% of Total Assets as of the time of incurrence; provided that (x) no Default shall have occurred
and be continuing and (y) the Borrower shall be in pro forma compliance with Section 6.10 and (ii) any Refinancing Indebtedness thereof;
(d) Indebtedness of Foreign Subsidiaries in an aggregate principal amount at any time outstanding not to exceed the multiple of (x) $50,000,000
and (y) the sum of 100% plus the percentage (which shall not be less than 0%) by which Consolidated EBITDA of the Borrower for the most recently ended
Test Period exceeds Consolidated EBITDA of the Borrower for the most recent Test Period on the Closing Date;
(e) Indebtedness of any Non-Loan Party in an aggregate principal amount at any time outstanding not to exceed $25,000,000;
(f) Guarantees of any Indebtedness permitted pursuant to this Section 6.01 and any Refinancing Indebtedness thereof, so long as in the case of
clause (b), the Loans are guaranteed by such Restricted Subsidiary to at least the same extent and, in the case of any Guarantees of Permitted Unsecured Debt
or the Senior Notes , such Guarantees are by their terms subordinated in right of payment to the Obligations;
(g) IAC/Match Intercompany Debt;
(h) (x) Indebtedness of the Borrower owed to any Restricted Subsidiary or of a Restricted Subsidiary owed to any other Restricted Subsidiary or
the Borrower and (y) guarantees by any Restricted Subsidiary or the Borrower of any Indebtedness of the Borrower or any other Restricted Subsidiary;
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provided , however , that upon any such Indebtedness being owed to any Person other than the Borrower or a Restricted Subsidiary or any such guarantee
being of Indebtedness of any Person other than the Borrower or a Restricted Subsidiary, as applicable, the Borrower or such Restricted Subsidiary, as
applicable, shall be deemed to have incurred Indebtedness not permitted by this clause (h);
(i) Indebtedness outstanding on the Closing Date and set forth on Schedule 6.01 and any Refinancing Indebtedness thereof;
(j) (i) Indebtedness of any Person which becomes a Restricted Subsidiary after the Closing Date or is merged with or into or consolidated or
amalgamated with the Borrower or any Restricted Subsidiary after the Closing Date and Indebtedness expressly assumed in connection with the acquisition
of an asset or assets from any other Person; provided that (A) such Indebtedness existed at the time such Person became a Restricted Subsidiary or of such
merger, consolidation, amalgamation or acquisition and was not created in anticipation thereof and (B) immediately after such Person becomes a Restricted
Subsidiary or such merger, consolidation, amalgamation or acquisition, (x) no Default shall have occurred and be continuing, and (y) the Borrower shall be
in pro forma compliance with Section 6.10 and (ii) any Refinancing Indebtedness of such Indebtedness described in clause (i);
(k) Indebtedness constituting Investments not prohibited under Section 6.11 (other than Section 6.11(g));
(l) Indebtedness in respect of bid, performance, surety bonds or completion bonds issued for the account of the Borrower or any Restricted
Subsidiary in the ordinary course of business, including guarantees or obligations of the Borrower or any Restricted Subsidiary with respect to letters of
credit supporting such bid, performance, surety or completion obligations;
(m) Indebtedness owed to any officers or employees of the Borrower or any Restricted Subsidiary; provided that the aggregate principal amount
of all such Indebtedness shall not exceed $5,000,000 at any time outstanding;
(n) Indebtedness arising or incurred as a result of or from the adjudication or settlement of any litigation or from any arbitration or mediation
award or settlement, in any case involving the Borrower or any Restricted Subsidiary, provided that the judgment, award(s) and/or settlements to which such
Indebtedness relates would not constitute an Event of Default under Section 7.01(j);
(o) indemnification, adjustment of purchase price, deferred purchase price, contingent consideration or other compensation or similar obligations,
in each case, incurred or assumed in connection with the acquisition or disposition of any business or assets of the Borrower or any Restricted Subsidiary or
Equity Interests of a Restricted Subsidiary, other than Guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets
or Equity Interests for the purpose of financing or in contemplation of any such acquisition; provided that, in the case of a disposition, the maximum
aggregate liability in respect of all such obligations incurred or assumed in connection with such disposition outstanding under this clause (o) shall at no time
exceed the gross proceeds (including Fair Market Value of noncash proceeds measured at the time such noncash proceeds are received) actually received by
the Borrower and the Restricted Subsidiaries in connection with such disposition;
(p) unsecured Indebtedness in respect of obligations of the Borrower or any of its Restricted Subsidiaries to pay the deferred purchase price of
goods or services or progress payments in connection with such goods and services; provided that such obligations are incurred in connection with open
accounts
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extended by suppliers on customary trade terms (which require that all such payments be made within 60 days after the incurrence of the related obligations)
in the ordinary course of business and not in connection with the borrowing of money;
(q) letters of credit, bank guarantees, warehouse receipts or similar instruments issued to support performance obligations and trade letters of
credit (other than obligations in respect of other Indebtedness) in the ordinary course of business;
(r) Indebtedness arising (A) from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against
insufficient funds in the ordinary course of business; provided , however , that such Indebtedness is extinguished within five Business Days of incurrence or
(B) under any customary cash pooling or cash management agreement with a bank or other financial institution in the ordinary course of business;
(s) Indebtedness representing deferred compensation incurred in the ordinary course of business;
(t) Indebtedness arising in connection with endorsement of instruments for deposit in the ordinary course of business;
(u) Indebtedness supported by a letter of credit, bank guarantee or similar instrument, in principal amount not in excess of the stated amount of
such letter of credit, bank guarantee or similar instrument;
(v) the disposition of accounts receivable in connection with receivables factoring arrangements in the ordinary course of business;
(w) Indebtedness of the Borrower consisting of obligations for the payment of letters of credit in commitment amounts not to exceed $10,000,000
in the aggregate at any one time outstanding, excluding any commitment amounts for letters of credit issued pursuant to Indebtedness incurred under any
other clause of this Section 6.01;
(x) any guarantee by the Borrower or any of its Restricted Subsidiaries, in the ordinary course of business, of obligations of suppliers, customers,
franchisees and licensees of the Borrower or any of its Restricted Subsidiaries;
(y) Guarantees of obligations of IAC under the IAC Credit Agreement and the IAC Senior Notes until the Separation Date; [reserved];
(z) unsecured intercompany Indebtedness owed by a member of the Match Group to a member of the IAC Group that is by its terms subordinated
in right of payment to the Obligations (the “ IAC Subordinated Debt Facility ”), so long as, (I) in respect of each borrowing, on a pro forma basis after giving
effect thereto and the use of proceeds thereof the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00 (excluding any cash constituting
proceeds of such Indebtedness), (II) no Default or Event of Default shall have occurred and be continuing or would exist after giving effect thereto, (III) the
Borrower shall be in compliance with Section 6.10 on a pro forma basis after giving effect to the incurrence of any such borrowing and the use of proceeds
thereof, (IV) such Indebtedness has a scheduled final maturity date of at least 90 days after the Revolving Termination Date and any then outstanding
Incremental Facility and such indebtedness shall not require any mandatory prepayments other than in connection with a change of control, (V) such
indebtedness (x) shall not require scheduled amortization payments, (y) shall have no
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financial maintenance covenants of a different type than the Financial Covenants, and no financial maintenance covenants that are more restrictive than the
Financial Covenants, and (z) does not have negative covenants and/or default provisions that are, taken as a whole, materially more restrictive than those
applicable to the Senior Secured Credit Facilities as determined in good faith by the Borrower, and (VI) such Indebtedness shall not be guaranteed by any
subsidiaries of the Borrower other than guarantees by the Guarantors that by their terms are subordinated in right of payment to the obligations under the
Senior Secured Credit Facilities;
(aa) Indebtedness of Loan Parties in an aggregate principal amount at any time outstanding not to exceed $25,000,000;
(bb) any Pre-IPO Notes; and
(cc) to the extent constituting Indebtedness, the Match Transactions.
Further, for purposes of determining compliance with this Section 6.01 and Section 6.02, at the option of the Borrower by written notice to the
Administrative Agent, any Indebtedness and/or Lien incurred to finance a Limited Condition Acquisition permitted hereunder shall be deemed to have been incurred
on the date the definitive acquisition agreement relating to such Limited Condition Acquisition was entered into (and not at the time such Limited Condition
Acquisition is consummated) and the Secured Net Leverage Ratio and/or the Consolidated Net Leverage Ratio shall be tested (x) in connection with such incurrence,
as of the date the definitive acquisition agreement relating to such Limited Condition Acquisition was entered into, giving pro forma effect to such Limited Condition
Acquisition, to any such Indebtedness or Lien, and to all transactions in connection therewith and (y) in connection with any other incurrence after the date the
definitive acquisition agreement relating to such Limited Condition Acquisition was entered into and prior to the earlier of the consummation of such Limited
Condition Acquisition or the termination of such definitive agreement prior to the incurrence (but not, for the avoidance of doubt, for purposes of determining the
Applicable Rate or actual compliance with the Financial Covenants), both (i) on the basis set forth in clause (x) above and (ii) without giving effect to such acquisition
or the incurrence of any such Indebtedness or Liens or the other transactions in connection therewith.
SECTION 6.02 Liens . The Borrower will not, and will not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any Lien on any
property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including accounts receivable) or rights in respect of any thereof,
except:
(a) Permitted Encumbrances;
(b) any Lien on any property or asset of the Borrower or any Restricted Subsidiary (or any improvements or accession thereto or proceeds
therefrom) existing on the Closing Date and set forth in Schedule 6.02; provided that (i) such Lien shall not apply to any other property or asset of the
Borrower or any Restricted Subsidiary and (ii) such Lien shall secure only those obligations which it secures on the Closing Date and any Refinancing
Indebtedness in respect thereof;
(c) any Lien existing on any property or asset prior to the acquisition thereof by the Borrower or any Restricted Subsidiary or existing on any
property or asset of any Person that becomes a Restricted Subsidiary after the Closing Date prior to the time such Person becomes a Restricted Subsidiary;
provided that (i) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Restricted Subsidiary, as the
case may be, (ii) such Lien shall not apply to any other property or assets of the Borrower or any Restricted Subsidiary and (iii) such Lien shall secure only
those obligations
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which it secures on the date of such acquisition or the date such Person becomes a Restricted Subsidiary, as the case may be, and any Refinancing
Indebtedness in respect thereof;
(d) Liens securing Indebtedness of the Borrower or any Restricted Subsidiary incurred pursuant to Section 6.01(c); provided that (i) such Liens
are incurred prior to or within 90 days after such acquisition or the completion of such construction and improvement with the acquisition of such fixed or
capital assets, and (ii) such Liens do not at any time encumber any of its existing property other than the property financed by such Indebtedness;
(e) deposits, reserves and other Liens securing credit card operations of the Borrower and its Restricted Subsidiaries;
(f) Liens created by the Collateral Documents or otherwise securing the Obligations;
(g) Liens on the Collateral securing Permitted Secured Ratio Debt;
(h) during the Shared Collateral Period (if any), Liens on the Collateral securing Guarantees permitted by Section 6.01(y) so long as a Pari Passu
Intercreditor Agreement with respect to such Liens is in effect at such time; [reserved];
(i) Liens securing Guarantees of Permitted Secured Ratio Debt and Indebtedness permitted pursuant to Section 6.01(a); provided that, with
respect to any such Liens securing Guarantees of Permitted Secured Ratio Debt an intercreditor agreement reasonably satisfactory to the Administrative
Agent with respect to such Liens is in effect at such time;
(j) Liens that do not secure Indebtedness and do not interfere with the material operations of the Borrower and the Restricted Subsidiaries and do
not individually or in the aggregate materially impair the value of the assets of the Borrower and the Restricted Subsidiaries;
(k) Liens deemed to secure Capital Lease Obligations incurred in connection with any sale and leaseback transaction permitted by Section 6.08;
(l) licenses, sublicenses, leases or subleases that do not interfere in any material respect with the business of the Borrower or any Restricted
Subsidiary;
(m) any interest or title of a lessor or sublessor under, and Liens arising from Uniform Commercial Code financing statements (or equivalent
filings, registrations or agreements in foreign jurisdictions) relating to, leases and subleases permitted hereunder;
(n) normal and customary rights of setoff upon deposits of cash or other Liens originating solely by virtue of any statutory or common law
provision relating to bankers liens, rights of setoff or similar rights in favor of banks or other depository institutions and not securing any Indebtedness;
(o) Liens of a collection bank arising under Section 4-210 of the Uniform Commercial Code on items in the course of collection;
(p) Liens solely on any cash earnest money deposits made by the Borrower or any Restricted Subsidiary in connection with any letter of intent or
purchase agreement in respect of any acquisition or other investment by the Borrower or any Restricted Subsidiary;
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(q) Liens on assets of Non-Loan Parties securing Indebtedness permitted pursuant to Sections 6.01(d) and (e);
(r) any extension, renewal or replacement (or successive renewals or replacements) in whole or in part of any Lien referred to in clause (b), (c),
(d), (g), (i) or (q); provided that with respect to (b), (c) and (d), (x) the obligations secured thereby shall be limited to the obligations secured by the Lien so
extended, renewed or replaced (and, to the extent provided in such clauses, extensions, renewals and replacements thereof) and (y) such Lien shall be limited
to all or a part of the assets that secured the Lien so extended, renewed or replaced;
(s) Liens encumbering deposits made to secure obligations arising from common law, statutory, regulatory, contractual or warranty requirements
of the Borrower or any Restricted Subsidiary, including rights of offset and setoff;
(t) Liens securing Hedging Obligations entered into for bona fide hedging purposes of the Borrower or any Restricted Subsidiary not for the
purpose of speculation;
(u) Liens in favor of a Loan Party;
(v) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the
importation of goods and Liens in the ordinary course of business in favor of issuers of performance and surety bonds or bid bonds or with respect to health,
safety and environmental regulations (other than for borrowed money) or letters of credit or bank guarantees issued to support such bonds or requirements
pursuant to the request of and for the account of such Person in the ordinary course of business;
(w) Interests of vendors in inventory arising out of such inventory being subject to a “sale or return” arrangement with such vendor or any
consignment by any third party of any inventory;
(x) Liens securing Indebtedness owed by (a) a Restricted Subsidiary to the Borrower or to any other Restricted Subsidiary that is a Subsidiary
Guarantor or (b) the Borrower to a Subsidiary Guarantor;
(y) Liens securing obligations pursuant to cash management agreements and treasury transactions; and
(z) Liens arising under any retention of title, hire purchase or conditional sale arrangement or arrangements having similar effect in respect of
goods supplied to the Borrower and its Restricted Subsidiaries in the ordinary course of trading and on the supplier’s standard or usual terms.
provided that, at any time, no voluntary Lien shall be created, incurred, assumed or permitted to exist on any Equity Interests of any Restricted Subsidiary required to
be pledged to secure the Obligations hereunder other than (i) Permitted Encumbrances described in clauses (a), (b) and (e) of the definition of “Permitted
Encumbrances,” (ii) Liens securing the Obligations , and (iii) Liens securing Permitted Secured Ratio Debt (and Liens securing Guarantees thereof permitted by
Section 6.01(f)) and (iv) during the Shared Collateral Period (if any), Liens securing the Guarantees permitted by Section 6.01(y) .
SECTION 6.03 Fundamental Changes . The Borrower will not, and will not permit any Restricted Subsidiary to, merge into or consolidate with any other
Person, or permit any other Person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or substantially all of
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its assets, or all or substantially all of the stock of any of its Restricted Subsidiaries (in each case, whether now owned or hereafter acquired), or liquidate or dissolve,
except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and be continuing:
(i) any Person may merge or be consolidated with or into the Borrower in a transaction in which the Borrower is the continuing or surviving
Person;
(ii) any Person (other than the Borrower) may merge or consolidate with or into any Restricted Subsidiary in a transaction in which the
surviving entity is or becomes a Restricted Subsidiary; provided that, if such Person is a Subsidiary Guarantor, the surviving entity is the Borrower or is or
substantially concurrently becomes a Subsidiary Guarantor;
(iii) any merger, consolidation, Disposition, liquidation or dissolution not prohibited by Sections 6.04, 6.05 and 6.11 shall be permitted;
(iv) any Restricted Subsidiary may Dispose of its assets, and the Borrower or any Restricted Subsidiary may Dispose of any stock of any of its
Restricted Subsidiaries, in each case to the Borrower or to another Restricted Subsidiary; and
(v) any Restricted Subsidiary may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution is in the
best interests of the Borrower and is not materially disadvantageous to the Lenders.
SECTION 6.04 Disposition of Property . The Borrower will not, and will not permit any Restricted Subsidiary to, directly or indirectly, consummate any
Asset Sale unless at the time of such transaction and after giving effect thereto and to the use of proceeds thereof, (i) no Default shall have occurred and be continuing
and (ii) the Borrower or such Restricted Subsidiary, as the case may be, receives consideration at least equal to the Fair Market Value of the assets sold or otherwise
disposed of, and (iii) in the case of an Asset Sale other than an Asset Swap if after giving pro forma effect to such Asset Sale (x) prior to the Term B-1 Loan
Repayment Date, the Secured Net Leverage Ratio is greater than 1.50 to 1.00 and (y) on or after the Term B-1 Loan Repayment Date, the Consolidated Net Leverage
Ratio is greater than 4.50 to 1.00, at least 75% of the consideration therefor received by the Borrower or such Restricted Subsidiary, as the case may be, is in the form
of cash or Cash Equivalents; provided that the amount of:
(i) any liabilities (as reflected in the Borrower’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto, or if
incurred or accrued subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Restricted
Subsidiary’s balance sheet or in the footnotes thereto if such incurrence or accrual had taken place on the date of such balance sheet) of the Borrower or such
Restricted Subsidiary other than liabilities that are by their terms subordinated in right of payment to the Loans, that are assumed by the transferee of any
such assets and for which the Borrower and all of its Restricted Subsidiaries have been validly released by all creditors in writing,
(ii) any securities, notes or other similar obligations received by the Borrower or such Restricted Subsidiary from such transferee that are
converted by the Borrower or such Restricted Subsidiary into cash or Cash Equivalents (to the extent so converted) within 180 days following the closing of
such Asset Sale, and
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(iii) any Designated Noncash Consideration received by the Borrower or any Restricted Subsidiary in such Asset Sale having an aggregate
Fair Market Value, taken together with all other Designated Noncash Consideration received pursuant to this clause (iii) that is at that time outstanding, not
to exceed the greater of $75,000,000 and 3.0% of Total Assets at the time of the receipt of such Designated Noncash Consideration, with the Fair Market
Value of each item of Designated Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value,
shall be deemed to be cash or Cash Equivalents for purposes of this provision and for no other purpose.
SECTION 6.05 Restricted Payments . The Borrower will not, and will not permit any of its Restricted Subsidiaries to, declare or make, directly or
indirectly, any Restricted Payment, except:
(i) the payment by the Borrower or any Restricted Subsidiary of any dividend or the consummation of any irrevocable redemption within 60
days after the date of declaration thereof or giving the notice of the redemption, if on the date of declaration or notice the payment would have complied with
the provisions of the Indenture (assuming, in the case of redemption, the giving of the notice would have been deemed to be a Restricted Payment at such
time and such deemed Restricted Payment would have been permitted at such time);
(ii) the Borrower may declare or make a Restricted Payment with respect to its Equity Interest payable solely in Qualified Equity interests
Interests or redeem any of its Equity Interests in exchange for, or out of the proceeds of the substantially concurrent issuance and sale of, Qualified Equity
Interests or through accretion or accumulation of such dividends on such Equity Interests; provided that the issuance of such Equity Interests are not included
in any determination of the Retained Excess Cash Flow Amount;
(iii) repurchase, redemption or other acquisition for value by the Borrower of, Equity Interests of the Borrower held by officers, directors or
employees or former officers, directors or employees of the Borrower and any Restricted Subsidiary (or their transferees, estates or beneficiaries under their
estates), upon their death, disability, retirement, severance or termination of employment or service; provided that the aggregate cash consideration paid for
all such redemptions shall not exceed $10,000,000 during any twelve consecutive months (with unused amounts in any period being carried over to
succeeding periods); provided , further , that cancellation of Indebtedness owing to the Borrower or any Restricted Subsidiary from any current or former
officer, director or employee (or any permitted transferees thereof) of the Borrower or any of its Restricted Subsidiaries (or any direct or indirect parent
company thereof), in connection with a repurchase of Equity Interests of the Borrower from such Persons will not be deemed to constitute a Restricted
Payment for purposes of this covenant or any other provisions of the Indenture;
(iv) repurchases of Equity Interests deemed to occur (a) upon the exercise of stock options, warrants, or similar rights if the Equity Interests
represent all or a portion of the exercise price thereof or (b) in connection with the satisfaction of any withholding Tax obligations incurred relating to the
vesting or exercise of stock options, warrants, restricted stock units or similar rights;
(v) any Restricted Payment made out of the net cash proceeds of the substantially concurrent sale of, or made by exchange for, Qualified
Equity Interests of the Borrower (other than Qualified Equity Interests issued or sold to a Restricted Subsidiary of the Borrower or an employee stock
ownership plan or to a trust established by the Borrower or any of its Restricted Subsidiaries for the benefit of their employees) or a substantially concurrent
cash capital contribution received by the Borrower from its
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stockholders; provided that such net cash proceeds are not included in any determination of the Retained Excess Cash Flow Amount;
(vi) payments or distributions to dissenting stockholders pursuant to applicable law, pursuant to or in connection with a consolidation, merger
or transfer of all or substantially all of the assets of the Borrower and its Restricted Subsidiaries that complies with the provisions of Section 6.03;
(vii) any Restricted Subsidiary may declare or make a Restricted Payment with respect to the Equity Interests of such Restricted Subsidiary to
the Borrower or any other Restricted Subsidiary (and, in the case of a Restricted Subsidiary that is not a Wholly Owned Subsidiary, to each owner of Equity
Interests of such Restricted Subsidiary such that the Borrower or Restricted Subsidiary receives at least its pro rata share of such dividend or distribution);
(viii) Restricted Payments in an aggregate amount not to exceed in any fiscal year the greater of (x) $50,000,000 and (y) 10.0% of
Consolidated EBITDA for the then most recently ended Test Period less any Investments made under this clause pursuant to Section 6.11(t) ; provided that
after giving effect thereto on a pro forma basis (i) no Default shall have occurred and be continuing and (ii) the Consolidated Net Leverage Ratio is equal to
or less than 4.50 to 1.00;
(ix) Restricted Payments up to an aggregate amount not to exceed $100,000,000 less any Investments made under this clause pursuant to
Section 6.11(t) ;
(x) Restricted Payments so long as after giving effect thereto on a pro forma basis, (i) (x) prior to the Term B-1 Loan Repayment Date, the
Secured Net Leverage Ratio is equal to or less than 2.00 to 1.00 and (y) on or after the Term B-1 Loan Repayment Date, the Consolidated Net Leverage
Ratio is equal to or less than 3.50 to 1.00 and (ii) no Default shall have occurred and be continuing;
(xi) the Borrower and its Restricted Subsidiaries may make Restricted Payments to any member of the IAC Group that is a direct or indirect
parent of the Borrower:
(A) the proceeds of which will be used to pay the consolidated, combined or similar income tax liability of such parent’s income tax
group that is attributable to the income of the Borrower or its subsidiaries; provided that (x) no such payments with respect to any taxable year shall
exceed the amount of such income tax liability that would have been imposed on the Borrower and/or the applicable Subsidiaries had such
entity(ies) filed on a stand-alone basis and (y) any such payments attributable to an Unrestricted Subsidiary shall be limited to the amount of any
cash paid by such Unrestricted Subsidiary to the Borrower or any Restricted Subsidiary for such purpose;
(B) the proceeds of which shall be used to pay such equity holder’s operating costs and expenses, other overhead costs and expenses
and fees, in each case, which are directly attributable to the ownership or operations of the Borrower and its subsidiaries; or
(C) the proceeds of which shall be used to pay customary salary, bonus and other benefits payable to, and indemnities provided on
behalf of, officers and employees of any direct or indirect parent of the Borrower to the extent such salaries, bonuses, other benefits and indemnities
are directly attributable to the ownership or operation of the Borrower and its Restricted Subsidiaries;
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(xii) any Junior Debt Restricted Payments; provided that, at the time of, and after giving effect thereto on a pro forma basis (x) no Default
shall have occurred and be continuing and (y) the Borrower shall be in compliance with Section 6.10 as of the end of the most recently ended Test Period;
and
(xiii) Restricted Payments in connection with the Match Transactions . ; and
(xiv) prior to the Term B-1 Loan Repayment Date, Restricted Payments in an amount not to exceed the portion of the Retained Excess Cash
Flow Amount on the date of such election that the Borrower elects to apply to this Section 6.05(xiv) in a written notice of a Responsible Officer thereof,
which notice shall set forth the Retained Excess Cash Flow Amount (and the calculation thereof in reasonable detail) immediately prior to such election and
the amount thereof elected to be so applied; provided that after giving effect thereto on a pro forma basis (i) no Default shall have occurred and be continuing
and (ii) the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00.
SECTION 6.06 Transactions with Affiliates . The Borrower will not, and will not permit any of its Restricted Subsidiaries to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions (including
amendments or modifications to prior or existing transactions) with, any of its Affiliates involving payment or consideration in excess of $5,000,000, except:
(a) for transactions at prices and on terms and conditions not less favorable to the Borrower or such Restricted Subsidiary than could be obtained
on an arm’s-length basis from unrelated third parties, as determined by the Borrower;
(b) transactions between or among the Borrower and its Restricted Subsidiaries not involving any other Affiliate;
(c) pursuant to, as determined by the Borrower, reasonable director, officer and employee compensation (including bonuses) and other benefits
(including retirement, health, and stock compensation plans) and indemnification arrangements and performance of such arrangements;
(d) any Restricted Payment permitted by Section 6.05;
(e) ordinary course overhead arrangements in which any Restricted Subsidiary or Unrestricted Subsidiary participates;
(f) any Investment permitted by Section 6.11;
(g) (x) any agreement or arrangement in effect on the Closing Date and any amendment or replacement thereof that is not more disadvantageous
to the Lenders in any material respect than the agreement or arrangement in effect on the Closing Date; or (y) any transaction pursuant to any agreement or
arrangement referred to in the immediately preceding clause (x).
(h) any transaction with a joint venture or similar entity which would be subject to this Section 6.06 solely because the Borrower or a Restricted
Subsidiary owns an equity interest in or otherwise controls such joint venture or similar entity;
(i) any transaction entered into by a Person prior to the time such Person becomes a Restricted Subsidiary or is merged or consolidated with or
into the Borrower or a Restricted Subsidiary;
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(j) any transaction with an Affiliate where the only consideration paid by the Borrower or any Restricted Subsidiary is Qualified Equity Interests;
(k) the issuance or sale of any Qualified Equity Interests;
(l) any issuance of securities, or other payments, awards or grants in cash, securities or otherwise, in each case pursuant to, or the funding of,
employment arrangements, stock options and stock ownership plans in the ordinary course of business;
(m) any employment agreements entered into by the Borrower or any of its Restricted Subsidiaries in the ordinary course of business and the
transactions pursuant thereto;
(n) transactions between any one or more members of the IAC Group and any one or more members of the Match Group in connection with the
Match Transactions; and
(o) transactions with an Escrow Borrower, including any Escrow Assumption and the entrance into any agreements related thereto so long as no
Default or Event of Default shall have occurred and be continuing or would result therefrom.
SECTION 6.07 Changes in Fiscal Periods . The Borrower will not, and will not permit any of its Restricted Subsidiaries to, change its fiscal year to end on
a day other than December 31 or change its method of determining fiscal quarters.
SECTION 6.08 Sales and Leasebacks . The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any arrangement with
any Person (other than the Borrower or a Restricted Subsidiary) providing for the leasing by the Borrower or any Restricted Subsidiary of real or personal property
that has been or is to be sold or transferred by the Borrower or any Restricted Subsidiary to such Person or to any other Person to whom funds have been or are to be
advanced by such Person on the security of such property or rental obligations of the Borrower or any Restricted Subsidiary unless (i) the lease in such arrangement is
a capital lease and such capital lease may be entered into at such time pursuant to Section 6.01 and 6.02 or (ii) the lease in such arrangement is not a capital lease and
the aggregate proceeds from such arrangement and other such arrangements since the Closing Date do not exceed the greater of $15,000,000 and 3.0% of
Consolidated EBITDA after giving effect thereto on a pro forma basis for the then most recently ended Test Period for which financial statements have been delivered
pursuant to Section 5.01(a) or (b).
SECTION 6.09 Clauses Restricting Subsidiary Distributions . The Borrower will not, and will not permit any of its Restricted Subsidiaries to, directly or
indirectly, enter into or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to (a) pay dividends
or make any other distributions on or in respect of its Equity Interests held by the Borrower or a Restricted Subsidiary, (b) make loans or advances or pay any
Indebtedness or other obligation owed to the Borrower or any Subsidiary Guarantor or (c) transfer any of its assets to the Borrower or any Subsidiary Guarantor,
except for such encumbrances or restrictions existing under or by reason of:
(i) any encumbrances or restrictions existing under this Agreement and the other Loan Documents;
(ii) encumbrances or restrictions with respect to a Restricted Subsidiary imposed pursuant to an agreement that has been entered into in
connection with the Disposition of all or substantially all of the capital stock or assets of such Restricted Subsidiary;
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(iii) encumbrances or restrictions under any agreement governing Capital Lease Obligations secured by Liens permitted by Section 6.02, so
long as such restrictions apply only to the assets subject to such Liens or relating to such Capital Lease Obligations, as the case may be;
(iv) encumbrances or restrictions under any agreement listed on Schedule 6.09 as in effect on the Closing Date;
(v) encumbrances or restrictions under any agreement of any Person that becomes a Restricted Subsidiary after the Closing Date that existed
prior to the time such Person became a Restricted Subsidiary; provided that such restrictions are not created in contemplation of or in connection with such
acquisition;
(vi) any other instrument or agreement entered into after the Closing Date that contains encumbrances and restrictions that, as determined by
the Borrower, will not materially adversely affect the Borrower’s ability to make payments on the Loans;
(vii) encumbrances or restrictions existing under or by reason of applicable law, regulation or order;
(viii) non-assignment provisions of any contract or lease entered into in the ordinary course of business;
(ix) encumbrances or restrictions imposed under any agreement to sell assets, including Qualified Equity Interests of such Restricted
Subsidiary, permitted under this Agreement to any Person pending the closing of such sale;
(x) encumbrances or restrictions relating to any Lien permitted under this Agreement imposed by the holder of such Lien that limit the right of
the relevant obligor to transfer assets that are subject to such Lien;
(xi) encumbrances or restrictions relating to any Lien on any asset or property at the time of acquisition of such asset or property by the
Borrower or any Restricted Subsidiary;
(xii) customary provisions in partnership agreements, limited liability company organizational governance documents, joint venture
agreements, shareholder agreements and other similar agreements that restrict the transfer of ownership interests in such partnership, limited liability
company, joint venture, corporation or similar Person;
(xiii) encumbrances or restrictions on cash or other deposits or net worth imposed by suppliers, customers or landlords under contracts entered
into in the ordinary course of business;
(xiv) Indebtedness incurred in compliance with Section 6.01(c) that imposes restrictions of the nature described in clause (c) above on the
assets acquired;
(xv) with respect to clause (c) only, any encumbrance or restriction consisting of customary nonassignment provisions in leases governing
leasehold interests, licenses, joint venture agreements and agreements similar to any of the foregoing to the extent such provisions restrict the transfer of the
property subject to such leases, licenses, joint venture agreements or similar agreements;
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(xvi) with respect to clause (c) only, any encumbrance or restriction contained in security agreements or mortgages securing Indebtedness of a
Restricted Subsidiary to the extent such encumbrance or restriction restricts the transfer of the property subject to such security agreements or mortgages;
(xvii) any encumbrances or restrictions imposed by any amendments, modifications, restatements, renewals, increases, supplements,
refundings, replacements or refinancings of the contracts, agreements, instruments or obligations referred to in this Section 6.09; provided that, as determined
by the Borrower, such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings (a) are not
materially more restrictive with respect to such encumbrances and restrictions than those prior to such amendments, modifications, restatements, renewals,
increases, supplements, refundings, replacements or refinancings or (b) will not materially adversely affect the Borrower’s ability to make payments on the
Loans ;
(xviii) encumbrances or restrictions imposed by the Senior Notes ; and
(xix) (xviii) encumbrances or restrictions imposed on any member of the Match Group in connection with the Match Transactions.
SECTION 6.10 Consolidated Net Leverage Ratio; Interest Coverage Ratio . The For so long as Revolving Commitments, Revolving Loans or LC
Exposure remain outstanding, with respect to the Revolving Facility only, the Borrower will not permit the Consolidated Net Leverage Ratio as of the last day of any
Test Period to be more than 5.00 to 1.00. The For so long as Revolving Commitments, Revolving Loans or LC Exposure remain outstanding, with respect to the
Revolving Facility only, the Borrower will not permit the Interest Coverage Ratio as of the last day of any Test Period to be less than 2.50 to 1.00
SECTION 6.11 Investments . The Borrower will not, and will not permit any of its Restricted Subsidiaries to, make any advance, loan, extension of credit
(by way of Guarantee or otherwise) or capital contribution to, or purchase any Equity Interests, bonds, notes, debentures or other debt securities of, or any assets
constituting a business unit of, or incur any Unrestricted Subsidiary Support Obligations with respect to, any other Person (all of the foregoing, “ Investments ”)
except:
(a) extensions of trade credit and credit to customers in the ordinary course of business;
(b) Investments in cash and Cash Equivalents and Investments that were Cash Equivalents when made;
(c) loans and advances to directors, employees and officers of the Borrower or any Restricted Subsidiary in the ordinary course of business
(including for travel, entertainment and relocation expenses) in an aggregate principal amount for the Borrower and its Restricted Subsidiaries not to exceed
$10,000,000 at any one time outstanding;
(d) Investments made by the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary;
(e) Investments (other than Investments directly or indirectly in Unrestricted Subsidiaries) made at any time if, after giving pro forma effect
thereto, (i) the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00 and (ii) no Default shall have occurred and be continuing;
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(f) any Investment existing on, or made pursuant to binding commitments existing on, the Closing Date and disclosed to the Lenders in writing
on the Closing Date;
(g) Investments not prohibited by Section 6.05;
(h) Investments in Unrestricted Subsidiaries in an aggregate amount not to exceed $150,000,000 (x) prior to the Term B-1 Loan Repayment Date,
$50,000,000 and (y) on or after the Term B-1 Loan Repayment Date, $150,000,000, in each case, in any fiscal year (with unused amounts in any fiscal year
being carried over to succeeding fiscal years up to an aggregate amount not to exceed $450,000,000 (i) prior to the Term B-1 Loan Repayment Date,
$150,000,000 and (ii) on or after the Term B-1 Loan Repayment Date, $450,000,000, in each case, in any one fiscal year) , determined net of any cash
recoveries actually received in respect of such Investments (it being understood that, if an Unrestricted Subsidiary becomes a Restricted Subsidiary, there
will be deemed to have occurred a cash recovery of all Investments made in such subsidiary on or after the Closing Date); provided that after giving pro
forma effect to each such Investment, no Default shall have occurred and be continuing;
(i) Guarantees not prohibited by Section 6.01;
(j) Investments to the extent that payment for such Investments is made with Qualified Equity Interests of the Borrower; provided that the
issuance of such Equity Interests are not included in any determination of the Retained Excess Cash Flow Amount;
(k) accounts, chattel paper and notes receivable arising from the sale or lease of goods or the performance of services in the ordinary course of
business;
(l) Investments received in connection with the bankruptcy or reorganization of suppliers and customers and in settlement of delinquent
obligations of, and other disputes with, suppliers and customers arising in the ordinary course of business;
(m) Investments, including in joint ventures of the Borrower or any Restricted Subsidiary, in an amount not to exceed at any one time
outstanding the greater of $50,000,000 or 2.00% of Total Assets;
(n) Investments arising out of the receipt by the Borrower or a Restricted Subsidiary of noncash consideration for the sale of assets permitted
under Section 6.04;
(o) Guarantees by the Borrower or any Restricted Subsidiary of operating leases (other than Capital Lease Obligations) or of other obligations
that do not constitute Indebtedness, in each case entered into by the Borrower or Restricted Subsidiary in the ordinary course of business;
(p) lease, utility and other similar deposits in the ordinary course of business;
(q) to the extent constituting Investments, the Match Transactions; and
(r) Investments by the Borrower and its Restricted Subsidiaries in any Escrow Borrower for purposes of funding original issue discount, upfront
fees, redemption or repayment premium and interest with respect to any Escrow Permitted Ratio Debt or Escrow Incremental Term Loans, in each case, to
the extent such Escrow Permitted Ratio Debt and/or such Escrow Incremental Term Loans are incurred in connection with the Match Transactions; provided
that after giving pro forma effect to such Investment, no Default shall have occurred and be continuing ;
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(s) prior to the Term B-1 Loan Repayment Date, Investments in an amount not to exceed the portion of the Retained Excess Cash Flow Amount
on the date of such election that the Borrower elects to apply to this Section 6.11(s) in a written notice of a Responsible Officer thereof, which notice shall
set forth the Retained Excess Cash Flow Amount (and the calculation thereof in reasonable detail) immediately prior to such election and the amount thereof
elected to be so applied; provided that after giving effect thereto on a pro forma basis (i) no Default shall have occurred and be continuing and (ii) the
Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00; and
(t) prior to the Term B-1 Loan Repayment Date, Investments by the Borrower and its Restricted Subsidiaries, if the Borrower or any Restricted
Subsidiary would otherwise be permitted to make a Restricted Payment under Section 6.05(viii), (ix) or (x) in such amount; provided that the amount of any
such Investment shall be deemed to be a Restricted Payment under the applicable clause for all purposes under this Agreement) .
SECTION 6.12 Activities of The Match Group, Inc. The Match Group, Inc. (i) shall not engage in any material operational activity other than (1) the
ownership of Equity Interests in its subsidiaries or entities that become its subsidiaries (or, indirectly through its subsidiaries, other Equity Interests in accordance with
clause (ii) below) and activities incidental thereto, including making Investments in its subsidiaries or entities that become its subsidiaries and owing Indebtedness to
its subsidiaries, (2) activities in connection with the Transactions and the Match Transactions, (3) corporate maintenance activities and incurring fees, costs and
expenses relating to overhead and general operating including professional fees for legal, tax and accounting issues and paying taxes, (4) the performance of its
obligations and rights under and in connection with the Loan Documents and Transactions, any documentation governing any Indebtedness or Guarantee and the other
agreements contemplated hereby, (5) providing indemnification to officers, employees and members of the Board of Directors of the Borrower and boards of directors
and officers and employees of its subsidiaries, (6) the performing of activities in preparation for and consummating any public offering of its common stock or any
other issuance or sale of its Equity Interests, (7) activities that arise as a result of its status as a public company and a SEC registrant, (8) repurchases of Indebtedness
through open market purchases or Dutch Auctions permitted under this Agreement and (9) activities otherwise permitted pursuant to this Section 6.12, (ii) shall not
own or acquire any material assets (other than Equity Interests of its subsidiaries, Indebtedness through open market purchases or Dutch Auctions permitted hereunder
and cash and Cash Equivalents), (iii) may engage in financing activities, including the incurrence of Indebtedness, issuance of equity, payment of Restricted
Payments, contribution to the capital of its subsidiaries and guarantee the obligations of its subsidiaries in each case as otherwise not prohibited hereunder, (iv) may
participate in tax, accounting and other administrative matters as a member of the Match Group and as a subsidiary of IAC, (v) may engage in any activities required
by law, rule or regulation (or any activities in connection with, or that arise as part of, any litigation) and (vi) may engage in activities incidental or reasonably related
to the foregoing.
ARTICLE VII
Events of Default
SECTION 7.01 Events of Default . If any of the following events (“ Events of Default ”) shall occur:
(a) the Borrower shall fail to pay any principal of any Loan when and as the same shall become due and payable, whether at the due date thereof
or at a date fixed for prepayment thereof or otherwise;
(b) the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a) of this
Section 7.01) payable under this Agreement, when
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and as the same shall become due and payable, and such failure shall continue unremedied for a period of five Business Days;
(c) any representation or warranty made or deemed made by or on behalf of the Borrower or any other Loan Party in this Agreement or any other
Loan Document or any amendment, modification or waiver in respect thereof, or in any certificate furnished pursuant to this Agreement or any other Loan
Document or any amendment, modification or waiver in respect thereof, shall prove to have been incorrect in any material respect when made or deemed
made;
(d) any Loan Party shall fail to observe or perform any covenant, condition or agreement contained in Section 5.02, 5.03 (with respect to the
Borrower’s existence) or 5.08 or in Article VI; provided that unless any Incremental Term Facility expressly provides otherwise, the Borrower’s failure to
perform or observe the covenants set forth in Section 6.10 shall not constitute an Event of Default for purposes of any Term Facilities unless and until the
Required Revolving Lenders have actually declared all such obligations to be immediately due and payable in accordance with the Loan Documents and
such declaration has not been rescinded on or before the date on which the Lenders in respect of the Incremental Term Facilities declare an Event of Default
in connection therewith (the “ Term Loan Standstill Period ”);
(e) any Loan Party shall fail to observe or perform any covenant, condition or agreement contained in this Agreement or any other Loan
Document to which it is a party (other than those specified in clause (a), (b), (c) or (d) of this Section 7.01), and such failure shall continue unremedied for a
period of 30 days after written notice thereof from the Administrative Agent to the Borrower (which notice will be given at the request of any Lender);
(f) the Borrower or any Restricted Subsidiary shall fail to make any payment (whether of principal or interest and regardless of amount) in
respect of any Material Indebtedness, when and as the same shall become due and payable after any applicable grace period therefor;
(g) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or permits
(with or without the giving of notice) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any Material
Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided that this
clause (g) shall not apply to secured Indebtedness that becomes due as a result of the voluntary sale or transfer of the property or assets securing such
Indebtedness;
(h) an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in
respect of the Borrower or any Material Subsidiary or its debts, or of a substantial part of its assets, under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar
official for the Borrower or any Material Subsidiary or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue
undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;
(i) the Borrower or any Material Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization
or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent to the institution
of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Section 7.01, (iii) apply for or consent to
the appointment of a receiver, trustee, custodian,
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sequestrator, conservator or similar official for the Borrower or any Restricted Subsidiary or for a substantial part of its assets, (iv) file an answer admitting
the material allegations of a petition filed against it in any such proceeding, (v) make a general assignment for the benefit of creditors or (vi) take any action
for the purpose of effecting any of the foregoing;
(j) one or more judgments for the payment of money in an aggregate amount in excess of $50,000,000 (to the extent not adequately covered by
insurance) shall be rendered against the Borrower, any Material Subsidiary or any combination thereof and the same shall remain undischarged for a period
of 60 consecutive days during which execution shall not be effectively stayed;
(k) an ERISA Event shall have occurred that, when taken together with all other ERISA Events that have occurred, would reasonably be expected
to result in a Material Adverse Effect;
(l) at any time, the Pledge Agreement shall cease, for any reason, to be in full force and effect, or any Loan Party shall so assert in writing, or any
material Lien created by the Pledge Agreement shall cease to be enforceable and of the same effect and priority purported to be created thereby (except, in
each case, as permitted under the Loan Documents);
(m) this Agreement or the Guarantee Agreement shall cease, for any reason, to be in full force and effect, or any Loan Party shall so assert in
writing, except as permitted under the Loan Documents; or
(n) Change of Control shall occur;
then, and in every such event (other than an event with respect to the Borrower described in clause (h) or (i) of this Section 7.01), and at any time thereafter during the
continuance of such event, the Administrative Agent may, and at the request of the Required Lenders (or, unless any Incremental Term Facility provides otherwise, to
the extent such Event of Default solely comprises an Event of Default arising from the Borrower’s failure to perform or observe the covenants set forth in Section
6.10, prior to the expiration of the Term Loan Standstill Period, at the request of the Required Revolving Lenders only, and in such case only with respect to the
Revolving Commitments, Revolving Loans and any Letters of Credit) shall, by notice to the Borrower, take any or all of the following actions, at the same or different
times: (i) terminate the Revolving Commitments, and thereupon the Revolving Commitments shall terminate immediately, (ii) declare the Loans then outstanding to
be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable during the
continuation of such event) by the Borrower, and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all
fees and other obligations of the Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any
kind (other than notice from the Administrative Agent), all of which are hereby waived by the Borrower and (iii) require all outstanding Letters of Credit to be cash
collateralized in accordance with Section 2.17(k); and in case of any event with respect to the Borrower described in clause (h) or (i) of this Section 7.01, the
Revolving Commitments shall automatically terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other
obligations of the Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of
which are hereby waived by the Borrower.
ARTICLE VIII
The Administrative Agent
SECTION 8.01 Appointment and Authorization . Each of the Lenders hereby irrevocably appoints the Administrative Agent as its agent and authorizes the
Administrative Agent to take such actions on its behalf and to
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exercise such powers as are delegated to the Administrative Agent by the terms hereof and the other Loan Documents, together with such actions and powers as are
reasonably incidental thereto.
SECTION 8.02 Administrative Agent and Affiliates . The bank serving as the Administrative Agent hereunder shall have the same rights and powers in its
capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and such bank and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with the Borrower or any Restricted Subsidiary or other Affiliate thereof as if it were not
the Administrative Agent hereunder.
SECTION 8.03 Action by Administrative Agent . The Administrative Agent shall not have any duties or obligations except those expressly set forth herein
and the other Loan Documents. Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied
duties, regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or
exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby that the Administrative Agent is required to exercise in
writing as directed by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section
9.02 or 9.03), and (c) except as expressly set forth herein, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to
disclose, any information relating to the Borrower or any of its Restricted Subsidiaries that is communicated to or obtained by the bank serving as Administrative
Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of
the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as provided in Section 9.02 or 9.03) or
otherwise, in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall be deemed not to have knowledge of any Default unless
and until written notice thereof is given to the Administrative Agent by the Borrower or a Lender, and the Administrative Agent shall not be responsible for or have
any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the
contents of any certificate, report or other document delivered under or in connection with this Agreement or any other Loan Document, (iii) the performance or
observance of any of the covenants, agreements or other terms or conditions set forth herein or in any other Loan Document, (iv) the validity, enforceability,
effectiveness or genuineness of this Agreement, the other Loan Documents or any other agreement, instrument or document, or (v) the satisfaction of any condition
set forth in Article IV or elsewhere herein or in any other Loan Document, other than to confirm receipt of items expressly required to be delivered to the
Administrative Agent.
SECTION 8.04 Consultation with Experts . The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any
notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper
Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall
not incur any liability for relying thereon. The Administrative 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 for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or
experts.
SECTION 8.05 Delegation of Duties . The Administrative Agent may perform any and all its duties and exercise its rights and powers by or through any
one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all its duties and exercise its
rights and powers through their respective Related Parties. The exculpatory provisions of the preceding paragraphs shall apply
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to any such sub-agent and to the Related Parties of the Administrative Agent 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 Administrative Agent.
SECTION 8.06 Successor Administrative Agent . Subject to the appointment and acceptance of a successor Administrative Agent as provided in this
paragraph, the Administrative Agent may resign at any time by notifying the Lenders and the Borrower. Upon any such resignation, the Required Lenders shall have
the right, in consultation with the Borrower, to appoint a successor. If no successor shall have been so appointed by the Required Lenders and shall have accepted
such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation, then the retiring Administrative Agent may, on behalf of the
Lenders, appoint a successor Administrative Agent which shall be a bank with an office in New York, New York, or an Affiliate of any such bank. Upon the
acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights, powers,
privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations hereunder. The
fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between the Borrower
and such successor. After the Administrative Agent’s resignation hereunder, the provisions of this Article and Section 9.04 shall continue in effect for the benefit of
such retiring Administrative Agent, its sub‑agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while it
was acting as Administrative Agent.
SECTION 8.07 Credit Decision . Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other
Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each
Lender also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and
information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any
other Loan Document, any related agreement or any document furnished hereunder or thereunder.
SECTION 8.08 Lead Arrangers; Syndication Agent; Co-Documentation Agents . Notwithstanding anything to the contrary herein, none of the Lead
Arrangers, the Syndication Agent or Co-Documentation Agents shall have any powers, duties or responsibilities under this Agreement or any of the other Loan
Documents, except in its capacity, if applicable, as the Administrative Agent, the Collateral Agent, a Lender or an Issuing Bank. Each Lender acknowledges that it has
not relied, and will not rely, on any of the Lead Arrangers, the Syndication Agent or the Co-Documentation Agents in deciding to enter into this Agreement or any
other Loan Document or in taking or not taking any action hereunder or thereunder.
SECTION 8.09 Tax Indemnification by the Lenders . To the extent required by any applicable Requirements of Law, the Administrative Agent may
withhold from any payment to any Lender an amount equivalent to any applicable withholding Tax. Without limiting or expanding the provisions of Section 2.14,
each Lender shall indemnify and hold harmless the Administrative Agent against, and shall make payable in respect thereof within 10 days after demand therefor, any
and all Taxes and any and all related losses, claims, liabilities and expenses (including fees, charges and disbursements of any counsel for the Administrative Agent)
incurred by or asserted against the Administrative Agent by the Internal Revenue Service or any other Governmental Authority as a result of the failure of the
Administrative Agent to properly withhold Tax from amounts paid to or for the account of such Lender for any reason (including, without limitation, because the
appropriate form was not delivered or not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstance that
rendered the exemption from, or reduction of withholding Tax ineffective). A certificate as to the amount of such
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payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative
Agent to set off and apply any and all amounts at any time owing to such Lender under this Agreement or any other Loan Document against any amount due the
Administrative Agent under this Section 8.09. The agreements in this Section 8.09 shall survive the resignation and/or replacement of the Administrative Agent, any
assignment of rights by, or the replacement of, a Lender, the termination of the commitments and the repayment, satisfaction or discharge of all other Obligations.
SECTION 9.01 Notices .
ARTICLE IX
Miscellaneous
(a) All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing (including by telecopy) (unless otherwise
specifically permitted in this Agreement), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered, or three
Business Days after being deposited in the mail, postage prepaid, or, in the case of telecopy or telephone notice, when received, addressed as follows in the case of the
Borrower and the Administrative Agent, and as set forth in an administrative questionnaire delivered to the Administrative Agent in the case of the Lenders, or to such
other address as may be hereafter notified by the respective parties hereto:
Borrower:
With a copy to:
Administrative Agent:
The Match Group, Inc.
555 West 18th Street
New York, NY 10011
Chief Financial Officer
Telephone: (212) 314-7210
Fax: (212) 632-9529
The Match Group, Inc.
555 West 18th Street
New York, NY 10011
General Counsel
Telephone: (212) 314-7376
Fax: (212) 632-9551
JPMorgan Chase Bank, N.A.
500 Stanton Christiana Road
Ops Building 2, 3 rd Floor
Newark, DE 19713-2107
Christopher Jackson
Telephone: (302) 634-1198
Fax: (302) 634-1417
and
J.P. Morgan Europe Limited
Loans Agency, 6th floor
25 Bank Street, Canary Wharf
London E145JP
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With a copy to:
United Kingdom
Attention: Loans Agency
Telephone: +44 20 7134 8188
Fax: +44 20 7777 2360
JPMorgan Chase Bank, N.A.
383 Madison Avenue, 24 th Floor
New York, New York 10179
Attention: Donatus Anusionwu
Telephone: (212) 622-0531
Fax: (212) 270-5127
(b) Notices, financial statements and similar deliveries and other communications to the Lenders hereunder may be delivered or furnished by electronic
communications pursuant to procedures approved by the Administrative Agent (including by posting on IntraLinks); provided that the foregoing shall not apply to
notices pursuant to Article II unless otherwise agreed by the Administrative Agent and the applicable Lender. 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.
SECTION 9.02 Waivers; Amendments .
(a) No failure or delay by the Administrative Agent or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further
exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent and the Lenders hereunder are cumulative and are
not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or consent to any departure by the Borrower
therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in
the specific instance and for the purpose for which given. Without limiting the generality of the foregoing, the making of a Loan shall not be construed as a waiver of
any Default, regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default at the time.
(b) Neither this Agreement nor any provision hereof may be waived, amended, amended and restated or modified except as provided in Sections 2.02, 2.19
and 2.20 or pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative
Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the written consent of
such Lender, (ii) reduce the principal amount of any Loan or reduce the rate of interest thereon, or reduce any fees payable hereunder, without the written consent of
each Lender directly affected thereby, (iii) postpone the scheduled date of payment of the principal amount of any Loan, or any interest thereon, or any fees payable
hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any Commitment, without the written consent
of each Lender directly affected thereby (it being understood that the waiver of (or amendment to the terms of) any mandatory prepayment of Term Loans shall not
constitute a postponement of any date scheduled for the payment of principal or interest), (iv) change Section 2.15 in a manner that would alter the pro rata
distribution or sharing of payments required thereby or any provision requiring the pro rata funding of Loans, without the written consent of each Lender, (v) except
as provided in Section 9.16, release all or substantially all of the Collateral securing the Obligations or all or substantially all of the value of the Guarantees provided
by the Guarantors taken as a whole without the written consent of each Lender,
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(vi) change any of the provisions of this Section or the definition of “Required Lenders,” “Required Revolving Lenders” or any other provision hereof specifying the
number or percentage of Lenders required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the
written consent of each Lender; provided that such provisions may be amended or amended and restated pursuant to the establishment of Incremental Term Loans
pursuant to Section 2.02 in order to restrict affiliated lenders and other persons from being included in such definitions or (vii) change the definition of “Alternative
Currency,” without the written consent of each Lender; provided , further, that no such agreement shall amend, modify or otherwise affect the rights or duties of the
Administrative Agent or any Issuing Bank hereunder without the prior written consent of the Administrative Agent or such Issuing Bank, as the case may be.
(c) Notwithstanding the foregoing, technical and conforming modifications to the Loan Documents may be made (including by amendment and
restatement) with the consent of the Borrower and the Administrative Agent (but without the consent of any Lender) to the extent necessary (A) to effectuate any
Incremental Facilities, Replacement Revolving Facility Commitments, Replacement Revolving Loans, Extended Revolving Commitments and Extended Revolving
Loans in a manner consistent with Sections 2.02, 2.19 and 2.20 and as may be necessary to establish such Incremental Facilities, Extended Revolving Commitments,
Term Loans, Replacement Revolving Facility Commitments, Replacement Revolving Loans or Extended Revolving Loans as a separate Class or tranche from any
existing Term Loans, Revolving Commitments or Revolving Loans, as applicable, and, in the case of Extended Term Loans, to reduce the amortization schedule of
the related existing Class of Term Loans proportionately or (B) to cure any ambiguity, omission, error, defect or inconsistency and, in each case under this clause (B),
such amendment shall become effective without any further action or consent of any other party to any Loan Document if the same is not objected to in writing by the
Required Lenders within ten Business Days following receipt of notice thereof.
(d) Notwithstanding anything in this Agreement or the other Loan Documents to the contrary, unless otherwise set forth in any Incremental Assumption
Agreement, Extension Amendment or Refinancing Amendment with respect to the Class of Loans and Commitments established thereby, only the consent of the
Required Revolving Lenders shall be necessary to (1) waive or consent to a waiver of an Event of Default under Section 7.01(d) (solely with respect to Section 6.10)
or (2) modify or amend Section 6.10 (including, in each case, the component definitions thereof, solely to the extent such definitions are used in such Section (but not
otherwise)) or this clause (d).
SECTION 9.03 Waivers; Amendments to Other Loan Documents .
(a) No failure or delay by the Administrative Agent or any Lender in exercising any right or power under the Guarantee Agreement or the Pledge
Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative
Agent and the Lenders under the Guarantee Agreement and the Pledge Agreement are cumulative and are not exclusive of any rights or remedies that they would
otherwise have. No waiver of any provision of the Guarantee Agreement or the Pledge Agreement or consent to any departure by any Loan Party therefrom shall in
any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only in the specific
instance and for the purpose for which given.
(b) Neither the Guarantee Agreement, the Pledge Agreement nor any provision thereof may be waived, amended. amended and restated or modified except
pursuant to an agreement or agreements in writing entered into by each affected Loan Party and, except as provided in Section 2.02, 2.19, 2.20, 9.02 or in the case of
amendments to the Pledge Agreement described in Section 7.1(b) thereof, the Required Lenders or by the affected
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Loan Party and the Administrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) release all or substantially all of the
Collateral (except as provided in Section 9.16), (ii) modify the “waterfall” provisions set forth in Section 5.3 of the Pledge Agreement, (iii) release all or substantially
all of the Material Domestic Subsidiaries as Subsidiary Guarantors (except as provided in Section 9.16) or (iv) change any of the provisions of this Section, in each
case without the written consent of each Lender; provided , further , that no such agreement shall amend, modify or otherwise affect the rights or duties of the
Collateral Agent under the Guarantee Agreement or the Pledge Agreement without the prior written consent of the Collateral Agent.
(c) Without the consent of any Lender, the Loan Parties and the Administrative Agent and the Collateral Agent may (in their respective sole
discretion, or shall, to the extent required by any Loan Document) enter into any amendment, modification, supplement or waiver of any Loan Document, or enter into
any new agreement or instrument, to effect the granting, perfection, protection, expansion or enhancement of any security interest in any Collateral or additional
property to become Collateral for the benefit of the Secured Parties, and to give effect to any intercreditor agreement reasonably satisfactory to the Administrative
Agent associated therewith, or as required by local law to give effect to, or protect, any security interest for the benefit of the Secured Parties in any property or so that
the security interests therein comply with applicable law or this Agreement or in each case to otherwise enhance the rights or benefits of any Lender under any Loan
Document.
SECTION 9.04 Expenses; Indemnity; Damage Waiver .
(a) The Borrower shall pay (i) all reasonable out‑of‑pocket expenses incurred by the Administrative Agent, the Lead Arrangers and their respective
Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent and the Lead Arrangers, in connection with the
syndication of the Revolving Facility and the preparation, execution, delivery and administration of this Agreement or any other Loan Document or any amendments,
modifications or waivers of the provisions hereof or thereof and (ii) all reasonable out-of-pocket expenses incurred by the Administrative Agent and the Lenders,
including the fees, charges and disbursements of one firm of counsel for the Administrative Agent and the Lenders taken as a whole (and in the case of an actual or
perceived conflict of interest, one additional counsel to all such affected Persons, taken as a whole), and to the extent required, one firm of local counsel in each
relevant jurisdiction (which may include a single special counsel acting in multiple jurisdictions) and one firm of regulatory counsel, in connection with the
enforcement or protection of its rights in connection with this Agreement or any other Loan Document, including their rights under this Section, or in connection with
the Loans made hereunder, including all such out-of‑pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans.
(b) The Borrower shall indemnify the Administrative Agent, the Lead Arrangers and each Lender, and each Related Party of any of the foregoing Persons
(each such Person being called an “ Indemnitee ”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related
expenses (including the reasonable and documented or invoiced out-of-pocket fees, expenses, disbursements and other charges of one firm of counsel for all
Indemnitees, taken as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnitee affected by such conflict notifies the Borrower of
any existence of such conflict and in connection with the investigating or defending any of the foregoing has retained its own counsel, of another firm of counsel for
such affected Indemnitee), and to the extent required, one firm or local counsel in each relevant jurisdiction) and one firm of regulatory counsel of any such
Indemnitee, arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document or any agreement or
instrument contemplated hereby or thereby, the performance by the parties to this Agreement or any other Loan Document of their respective obligations hereunder or
thereunder or the consummation of the Transactions or any other transactions contemplated hereby or thereby, (ii) any Loan or the use of the proceeds therefrom, (iii)
any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by the Borrower or any of its Restricted Subsidiaries, or
any Environmental Liability related in any way to the Borrower or any of its
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Restricted Subsidiaries, (iv) any civil penalty or fine assessed by OFAC against, and all reasonable costs and expenses (including counsel fees and disbursements)
incurred in connection with defense thereof, by the Administrative Agent or any Lender as a result of conduct of the Borrower that violates a sanction enforced by
OFAC or (v) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other
theory and regardless of whether any Indemnitee is a party thereto or whether or not such action, claim, litigation or proceeding was brought by the Borrower, its
equity holders, affiliates or creditors or any other third person; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses,
claims, damages, liabilities or related expenses (i) are determined by a court of competent jurisdiction in a final and nonappealable judgment to have resulted from the
gross negligence, willful misconduct or bad faith of such Indemnitee (or that of any of its respective subsidiaries or any of their respective officers, directors,
employees or members), (ii) are determined by a court of competent jurisdiction in a final and nonappealable judgment to have resulted from a material breach of this
Agreement by such Indemnitee or (iii) do not involve or arise from an act or omission by the Borrower or its subsidiaries or any of their respective affiliates, partners,
directors, officers, employees, agents, advisors or other representatives and is brought by an Indemnitee solely against one or more other Indemnitees (other than
claims against any Agent or any Lead Arranger in its capacity as such or in its fulfilling such role). Each Indemnitee shall give prompt notice to the Borrower of any
claim that may give rise to a claim against the Borrower hereunder and shall consult with the Borrower in the conduct of such Indemnitee’s legal defense of such
claim; provided , however , than an Indemnitee’s failure to give such prompt notice to the Borrower or to seek such consultation with the Borrower shall not constitute
a defense to any claim for indemnification by such Indemnitee unless, and only to the extent that, such failure materially prejudices the Borrower.
(c) To the extent that the Borrower fails to pay any amount required to be paid by it to the Administrative Agent under paragraph (a) or (b) of this Section,
each Lender severally agrees to pay to the Administrative Agent such Lender’s Total Percentage (determined as of the time that the applicable unreimbursed expense
or indemnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as
the case may be, was incurred by or asserted against the Administrative Agent in its capacity as such.
(d) To the extent permitted by applicable law, the parties shall not assert, and each hereby waives, any claim against any other party, on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this
Agreement or any agreement or instrument contemplated hereby, the Transactions, any Loan or the use of the proceeds thereof; provided that nothing in this clause
(d) is intended to relieve the Borrower of any obligation it may otherwise have to indemnify any Indemnitee against any special, indirect, consequential or punitive
damages asserted against such Indemnitee by a third party.
(e) All amounts due under this Section shall be payable within ten (10) Business Days after written demand therefor.
SECTION 9.05 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 (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of each
Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no Lender may assign or otherwise transfer its
rights or obligations hereunder except in accordance with this Section. Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person
(other than the
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parties hereto, their respective successors and assigns permitted hereby, Participants (to the extent provided in paragraph (c) of this Section) and, to the extent
expressly contemplated hereby, the Related Parties 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) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more financial institutions assignees (“ assignee ” or “
assignees ”) all or a portion of its rights and obligations under this Agreement (including all or a portion of its Revolving Commitments and the Loans at the time
owing to it) with the prior written consent of:
(A) the Borrower (such consent not to be unreasonably withheld or delayed, except for any bona fide competitors of the Borrower and its
subsidiaries); provided that no consent of the Borrower shall be required for an assignment ( x) i) of a Term Loan Commitment or a Term Loan to a Lender,
an Affiliate of a Lender, an Approved Fund or , (ii) of a Revolving Commitment or Revolving Loans to a Revolving Lender, an Affiliate of a Revolving
Lender or Approved Fund with respect to a Revolving Lender or (iii) if an Event of Default has occurred and is continuing, any other assignee (except for
any bona fide competitor of the Borrower and its subsidiaries) or (y) prior to the earlier of (i) the completion of the primary syndication of the Revolving
Commitments as notified by to the Borrower by the Lead Arrangers or (ii) October 15, 2015; ; provided , further , that the Borrower shall be deemed to have
consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within five (5) Business Days after having
received notice of the proposed assignment;
(B) the Administrative Agent (such consent not to be unreasonably withheld), provided that no consent of the Administrative Agent shall be
required for an assignment of any Revolving Commitment or Loan to an assignee that is a Lender, an Affiliate of a Lender or an Approved Fund; and
(C) each Issuing Bank.
(ii) Assignments shall be subject to the following additional conditions:
(A) except in the case of an assignment to a Lender or an Affiliate of a Lender or an assignment of the entire remaining amount of the assigning
Lender’s Revolving Commitment or Loans of any Class, the amount of the Revolving Commitments or Loans of the assigning Lender subject to each such
assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent) shall not be
less than $10,000,000 (or in the case of a Loan in an Alternative Currency, an appropriate corresponding amount as shall be consented to by the
Administrative Agent (such consent not be unreasonable withheld)), unless each of the Borrower and the Administrative Agent otherwise consent, provided
that no such consent of the Borrower shall be required if an Event of Default under clause (a), (b), (h) or (i) of Article VII has occurred and is continuing;
(B) each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this
Agreement, provided that this clause shall not be construed to prohibit the assignment of a proportionate part of all the assigning Lender’s rights and
obligations in respect of its Revolving Commitments or Revolving Loans;
(C) 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 (which fee is hereby waived for any assignment to which J.P. Morgan Chase Bank, N.A. or any of its Affiliates is a
party);
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(D) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire;
(E) on the date of such assignment, the assignee of a Revolving Commitment must be able to fund Revolving Loans in all Alternative Currencies;
and
(F) the assignee shall not be (i) the Borrower or any of the Borrower’s Affiliates or Subsidiaries except in accordance with Section 2.21 and
clause (e) below or (ii) a natural Person.
For the purposes of this Section 9.05(b), the term “ Approved Fund ” means any Person (other than a natural person) that is engaged in making, purchasing, holding or
investing in bank loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a
Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(v) of this Section, from and after the effective date specified in each
Assignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and 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 2.12, 2.13, 2.14 and
9.04). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section 9.05 shall be null and void.
(iv) The Administrative Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices 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 Revolving Commitments of, and principal amount
(and related 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 Administrative Agent 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 and any Lender (with respect to such Lender’s own interests only), at any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and Assumption with respect to a permitted assignment executed by an assigning Lender and an
assignee, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred
to in paragraph (b) of this Section (unless waived), and any written consent to such assignment required by paragraph (b) of this Section, the Administrative Agent
shall accept such Assignment and Assumption and record the information contained therein in the Register. No assignment shall be effective for purposes of this
Agreement unless it has been recorded in the Register as provided in this paragraph.
(c) (i) Any Lender may, without the consent of the Borrower or the Administrative Agent, sell participations to one or more banks, institutions or other
entities (a “ Participant ”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Revolving Commitments
and the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations and (C) the Borrower, the Administrative Agent and the other Lenders shall continue to
deal solely and directly with such
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Lender in connection with such Lender’s rights and obligations under this Agreement and the other Loan Documents. 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 and the other Loan Documents; provided that such agreement or instrument may provide
that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in the first proviso to Section 9.02(b) or
the first proviso to Section 9.03(b) that affects such Participant. Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each Participant shall be entitled
to the benefits of Sections 2.12, 2.13 and 2.14 (subject to the requirements and limitations of such Sections; provided that any documentation required to be provided
pursuant to Section 2.14(e) shall be provided solely to the participating Lender) to the same extent as if it were a Lender and had acquired its interest by assignment
pursuant to paragraph (b) of this Section. Each Lender that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of the Borrower, maintain
a register on which it enters the name and address of each Participant and the principal amounts (and related interest) of each Participant’s interest in the Loans or
other obligations under the Loan Documents (the “ Participant Register ”); provided that no Lender shall have any obligation to disclose all or any portion of the
Participant Register (including the identity of any Participant or any information relating to a Participant’s interest in any commitments, loans, letters of credit or its
other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary in connection with a Tax audit or other proceeding or
other governmental inquiry to establish that such commitment, loan, letter of credit or other obligation is in registered form under Section 5f.103-1(c) of the United
States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error, and the parties hereto 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.
(ii) A Participant shall not be entitled to receive any greater payment under Section 2.12 or 2.14 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant.
(d) Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank or other applicable central bank that governs or
regulates the activities of such Lender, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or
assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
(e) Any Lender may, at any time, assign all or a portion of its rights and obligations with respect to Loans to an Affiliated Lender, subject to the following
limitations:
(i) notwithstanding anything herein or in any of the other Loan Documents to the contrary, with respect to any acquisition of Loans, (1) under
no circumstances, whether or not any Loan Party is subject to a bankruptcy or other insolvency proceeding, shall such Affiliated Lender be permitted to
exercise any voting rights or any right to direct the Administrative Agent or the Collateral Agent to undertake any action (or refrain from taking any action)
with respect to any Loans and any Loans that are assigned to such Affiliated Lender shall have no voting rights or any right to direct the Administrative
Agent or the Collateral Agent to undertake any action (or refrain from taking any action) under this Agreement and the other Loan Documents (and shall not
object to any actions taken by the non-Affiliated Lenders, Administrative Agent or Collateral Agent in a bankruptcy or insolvency proceeding) and will be
deemed to have voted in the same proportion as non-Affiliated Lenders voting on such matter, unless the action or vote in question adversely affects such
Affiliated Lender (solely in its capacity as a Lender) in any
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material respect as compared to the other Lenders, (2) such Affiliated Lender shall not receive information provided solely to Lenders by the Administrative
Agent or any Lender and shall not be permitted to attend or participate in meetings attended solely by Lenders and the Administrative Agent and their
advisors and (3) the Affiliated Lender must provide a representation and warranty that it is not in possession of any material non-public information with
respect to the Loan Parties or their subsidiaries, or with respect to the Loans or the securities of any such person, that (A) has not been previously disclosed
in writing to the assigning Lender or the Lenders generally (other than because such Lender does not wish to receive such material non-public information)
prior to such time and (B) could reasonably be expected to have a material effect upon, or otherwise be material to, the assigning Lender’s decision to make
such assignment;
(ii) at the time any Affiliated Lender is making purchases of Loans it shall enter into an Affiliated Lender Assignment and Assumption;
(iii) at the time of such assignment, no Default or Event of Default shall have occurred and be continuing or would result therefrom;
(iv) each Affiliated Lender agrees to waive any right to bring any action in connection with the Loans against the Administrative Agent and
Collateral Agent, in their capacities as such;
(v) Affiliated Lenders may not hold more than 25% of the total amount of Loans and Commitments of any Class hereunder.
SECTION 9.06 Survival . All covenants, agreements, representations and warranties made by any Loan Parties herein, in the other Loan Documents and
in the certificates or other instruments delivered in connection with or pursuant to this Agreement or the other Loan Documents shall be considered to have been relied
upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the other Loan Documents and the making of any Loans,
regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Lender may have had notice or
knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as the
principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so long as the Revolving
Commitments have not expired or terminated. The provisions of Sections 2.12, 2.13, 2.14 and 9.04 and Article VIII shall survive and remain in full force and effect
regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Revolving Commitments,
any assignment of rights by or replacement of a Lender or the termination of this Agreement or any provision hereof.
SECTION 9.07 Counterparts; Integration; Effectiveness . This Agreement may be executed in counterparts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Loan
Documents and any separate letter agreements with respect to fees payable to the Administrative Agent or the Lead Arranger 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.
This Agreement shall become effective as provided in Section 4.01, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agreement by email or telecopy shall be effective as delivery of a
manually executed counterpart of this Agreement.
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SECTION 9.08 Severability . Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions
hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
SECTION 9.09 Right of Setoff . If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized
at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or
final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against any of and all the
obligations of the Borrower now or hereafter existing under this Agreement held by such Lender, irrespective of whether or not such Lender shall have made any
demand under this Agreement and although such obligations may be unmatured. The rights of each Lender under this Section are in addition to other rights and
remedies (including other rights of setoff) which such Lender may have. Each Lender agrees to notify the Administrative Agent promptly after any such setoff and
application; provided that the failure to give such notice shall not affect the validity of such setoff and application.
SECTION 9.10 Governing Law; Jurisdiction; Consent to Service of Process .
(a) This Agreement and the other Loan Documents and any claims, controversy, dispute or cause of action (whether in contract or otherwise) based upon,
arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the transactions
contemplated hereby and thereby shall be governed by and construed in accordance with the law of the State of New York.
(b) The Borrower and each other Loan Party irrevocably and unconditionally agrees that it will not commence any action, litigation or proceeding of any
kind or description, whether in law or equity, whether in contract or in tort or otherwise, against the Administrative Agent, any Lender, any Issuing Bank, or any
Related Party of the foregoing in any way relating to this Agreement or any other Loan Document or the transactions relating hereto or thereto, in any forum other
than the courts of the State of New York sitting in New York County, and of the United States District Court of the Southern District of New York, and any appellate
court from any thereof, and each of the parties hereto irrevocably and unconditionally submits to the jurisdiction of such courts and agrees that all claims in respect of
any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the parties
hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any
other manner provided by law. Nothing in this Agreement or any other Loan Document shall affect any right that the Administrative Agent, any Lender or any Issuing
Bank may otherwise have to bring any action or proceeding relating to this Agreement or the other Loan Documents against the Borrower or any other Loan Party or
their respective properties in the courts of any jurisdiction.
(c) The Borrower and each other Loan Party hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any
objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or the other Loan
Documents in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
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(d) Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01. Nothing in this Agreement
will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
SECTION 9.11 WAIVER OF JURY TRIAL . EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF
OR RELATING TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT
OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED TO IT, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN
THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES
HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.12 Headings . Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
SECTION 9.13 Confidentiality . Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other
advisors (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep
such Information confidential), (b) to the extent requested by any regulatory or self-regulatory authority, (c) to the extent required by applicable laws or regulations or
by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or any other Loan
Document or any suit, 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 substantially the same as those of this Section, to (i) any assignee of or Participant in, or any prospective assignee of or Participant
in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to
the Borrower and its obligations, (g) with the consent of the Borrower, (h) to the extent such Information (i) becomes publicly available other than as a result of a
breach of this Section or an agreement described in clause (f) hereof or (ii) becomes available to the Administrative Agent or any Lender on a nonconfidential basis
from a source other than the Borrower or (i) on a confidential basis to (x) any rating agency in connection with rating the Borrower or any of its subsidiaries or the
Loans hereunder, (y) the CUSIP Service Bureau or any similar agency in connection with the issuance and monitoring of CUSIP numbers with respect to the facilities
or (z) market data collectors, similar service providers to the lending industry and service providers to the Administrative Agent in connection with the administration
and management of this Agreement and the other Loan Documents. For the purposes of this Section, “ Information ” means all information received from the
Borrower or its Affiliates relating to the Borrower, its subsidiaries or their businesses, other than any such information that is available to the Administrative Agent or
any Lender on a nonconfidential basis prior to disclosure by the Borrower or its Affiliates. 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 if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would reasonably accord to its own confidential information.
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Each Subject to Section 9.18, each Lender acknowledges that information furnished to it pursuant to this Agreement or the other Loan Documents may
include material non-public information concerning the Borrower and its Affiliates and their related parties or their respective securities, and confirms that it has
developed compliance procedures regarding the use of material non-public information and that it will handle such material non-public information in accordance
with those procedures and applicable law, including Federal and state securities laws.
All Subject to Section 9.18, all information, including requests for waivers and amendments, furnished by the Borrower or the Administrative Agent
pursuant to, or in the course of administering, this Agreement or the other Loan Documents will be syndicate-level information, which may contain material non-
public information about the Borrower and its Affiliates and their related parties or their respective securities. Accordingly, each Lender represents to the Borrower
and the Administrative Agent that it has identified in its administrative questionnaire a credit contact who may receive information that may contain material non-
public information in accordance with its compliance procedures and applicable law, including Federal and state securities laws.
SECTION 9.14 Judgment Currency . If, for the purposes of obtaining judgment or filing a claim in any court, it is necessary to convert a sum due
hereunder or claim in one currency into another currency, the rate of exchange used shall be that at which in accordance with normal banking procedures the
Administrative Agent could purchase the first currency with such other currency on the Business Day preceding that on which final judgment is given. The obligation
of the Borrower in respect of any such sum due from it to the Administrative Agent or the Lenders hereunder shall, notwithstanding any judgment in a currency (the “
Judgment Currency ”) other than that in which such sum is denominated in accordance with the applicable provisions of this Agreement (the “ Agreement Currency
”), be discharged only to the extent that on the Business Day following receipt by the Administrative Agent of any sum adjudged to be so due in the Judgment
Currency, the Administrative Agent may in accordance with normal banking procedures 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 Administrative Agent from the Borrower in the Agreement Currency, the
Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Administrative Agent or the Person to whom such obligation was
owing against such loss. If the amount of the Agreement Currency so purchased is greater than the sum originally due to the Administrative Agent in such currency,
the Administrative Agent agrees to return the amount of any excess to the Borrower (or to any other Person who may be entitled thereto under applicable law).
SECTION 9.15 USA PATRIOT Act . Each Lender subject to the Act hereby notifies the Borrower that pursuant to the requirements of the USA
PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Act ”), it is hereby required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the Borrower
in accordance with the Act.
SECTION 9.16 Collateral and Guarantee Matters .
(a) The Lenders irrevocably authorize the Administrative Agent to enter into any customary intercreditor agreement (including the Pari Passu Intercreditor
Agreement) or arrangement in form and substance reasonably satisfactory to the Administrative Agent with the holders of any Permitted Secured Ratio Debt (or any
agent thereof) permitted under this Agreement that in the good faith determination of the Administrative Agent is necessary to effectuate the incurrence of such
Indebtedness.
(b) Any Lien on any property granted to or held by the Administrative Agent under any Loan Document shall automatically be released (i) upon all of the
Obligations (other than (x) (A) Cash Management Obligations and (B) Obligations under Specified Swap Agreements not yet due and payable, and (y) contingent
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obligations not yet accrued and payable) having been paid in full, all Letters of Credit having been cash collateralized or otherwise back-stopped (including by
“grandfathering” into any future credit facilities), in each case, on terms reasonably satisfactory to the relevant Issuing Bank in its sole discretion, or having expired or
having been terminated, and the Total Revolving Commitments having expired or having been terminated, (ii) that is Disposed of or to be Disposed of as part of or in
connection with any Disposition not prohibited hereunder or under any other Loan Document to any Person other than a Loan Party, (iii) subject to Section 9.02, if
approved, authorized or ratified in writing by the Required Lenders, (iv) owned by a Subsidiary Guarantor or, prior to the Separation Date, an IAC Guarantor, as
applicable, upon (or substantially simultaneously with) release of such Subsidiary Guarantor or IAC Guarantor, as applicable, from its obligations under its Guarantee
Agreement pursuant to clause (c) or (d) below, or (v) in the case of any Collateral pledged by an IAC Guarantor during the Shared Collateral Period, upon the release
of the IAC Administrative Agent’s Lien on such Collateral pursuant to the IAC Credit Agreement or (vi) as expressly provided in the Collateral Documents.
(c) (i) Any Subsidiary Guarantor shall automatically be released from its obligations under the Guarantee Agreement (A) in the event of dissolution of
such Person, (B) if such Person is designated as an Unrestricted Subsidiary or otherwise ceases to be a Restricted Subsidiary, in each case in accordance with the
provisions of this Agreement, upon (or substantially simultaneously with) effectiveness of such designation or when it first ceases to be a Restricted Subsidiary,
respectively, (C) if the obligations under this Agreement are discharged in accordance with the terms of this Agreement or (D) as otherwise expressly provided in the
Guarantee Agreement and (ii) any IAC Guarantor shall automatically be released from its obligations under the Guarantee Agreement in the event that such IAC
Guarantor has been (or is substantially simultaneously being) released from its Guarantees of the IAC Credit Agreement and the IAC Senior Notes ; provided that no
such release shall occur with respect to an entity that ceases to be a Restricted Subsidiary if such Subsidiary Guarantor or IAC Guarantor, as applicable, continues to
be a guarantor in respect of any Permitted Ratio Debt unless and until such guarantor is (or is being substantially simultaneously) released from its guarantee with
respect to such Permitted Ratio Debt.
(d) Each IAC Guarantor shall has been automatically be released from its obligations under the Guarantee Agreement and was automatically released upon
receipt of an Officer’s Certificate of the Borrower on the Separation Date stating that the Borrower will be designated as unrestricted subsidiary under the IAC Credit
Agreement and IAC Senior Notes, as applicable, on such date.
(e) Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writing the Administrative Agent’s authority to release its
interest in particular types or items of property, release any Subsidiary Guarantor or IAC Guarantor, as applicable, from its obligations under the Guarantee
Agreement, or enter into an intercreditor agreement pursuant to this Section 9.16. In each case as specified in this Section 9.16, the Administrative Agent will, at the
Loan Parties’ expense, execute and deliver to the applicable Loan Party such documents as such Loan Party may reasonably request to evidence the release of such
item of Collateral from the assignment and security interest granted under the Collateral Documents, or to release such Subsidiary Guarantor or IAC Guarantor, as
applicable, from its obligations under the Guarantee Agreement, in each case in accordance with the terms of the Loan Documents and this Section 9.16.
SECTION 9.17 No Advisory or Fiduciary Relationship . In connection with all aspects of each transaction contemplated hereby, the Borrower
acknowledges and agrees for itself and on behalf of the Loan Parties that (i) the Revolving Facility provided for hereunder and any related arranging or other services
in connection therewith (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document) are an arm’s-length
commercial transaction between the Loan Parties, on the one hand, and the Agent Parties and the Lenders, on the other hand, and the Loan Parties are capable of
evaluating and understanding and
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understand and accept the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents (including any amendment, waiver or
other modification hereof or thereof); (ii) in connection with the process leading to such transaction, each of the Agent Parties and the Lenders is and has been acting
solely as a principal and is not the agent or fiduciary for the Loan Parties; (iii) the Lead Arrangers, Agent Parties and their respective Affiliates may be engaged in a
broad range of transactions that involve interests that differ from, and may conflict with, those of the Borrower and its Affiliates, and none of the Lead Arrangers or
the Agent Parties has any obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary relationship; and (iv) the Agent Parties and the
Lenders have not provided and will not provide any legal, accounting, regulatory or tax advice with respect to any of the transactions contemplated hereby (including
any amendment, waiver or other modification hereof or of any other Loan Document) and the Loan Parties have consulted their own legal, accounting, regulatory and
tax advisors to the extent they have deemed appropriate.
SECTION 9.18 Platform; Borrower Materials. The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Lead Arrangers will
make available to the Lenders and the Issuing Bank materials and/or information provided by or on behalf of the Borrower hereunder (collectively, “Borrower
Materials”) by posting the Borrower Materials on Intralinks or another similar electronic system (the “Platform”), and (b) certain of the Lenders may be “public-side”
Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to the Borrower or their respective Subsidiaries or any of their
respective securities) (each, a “Public Lender”). The Borrower hereby agrees that it will identify that portion of the Borrower Materials that may be distributed to the
Public Lenders and that (i) all such Borrower Materials shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word
“PUBLIC” shall appear prominently on the first page thereof, (ii) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized the
Administrative Agent, the Lead Arrangers, the Issuing Bank and the Lenders to treat such Borrower Materials as solely containing information that is either (A)
publicly available information or (B) not material (although it may be sensitive and proprietary) with respect to the Borrower or the Subsidiaries or any of their
respective securities for purposes of United States Federal securities laws (provided, however, that such Borrower Materials shall be treated as set forth in Section
9.13, to the extent such Borrower Materials constitute information subject to the terms thereof), (iii) all Borrower Materials marked “PUBLIC” are permitted to be
made available through a portion of the Platform designated “Public Investor;” and (iv) the Administrative Agent and 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 Investor.” THE PLATFORM
IS PROVIDED “AS IS” AND “AS AVAILABLE”. THE ADMINISTRATIVE AGENT, ITS RELATED PARTIES AND THE LEAD ARRANGERS 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. 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 THE ADMINISTRATIVE AGENT, ANY OR ITS
RELATED PARTIES OR ANY LEAD ARRANGER IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM
-128-
[ signature pages intentionally omitted]
Exhibit 10.11
AMENDED AND RESTATED CREDIT AGREEMENT
Dated as of October 7, 2015,
as amended and restated as of November 16, 2015
among
MATCH GROUP, INC.,
as Borrower,
THE LENDERS PARTY HERETO,
and
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent
J.P. MORGAN SECURITIES LLC, MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, DEUTSCHE BANK SECURITIES
INC., BNP PARIBAS SECURITIES CORP. and
GOLDMAN SACHS LENDING PARTNERS LLC,
as Joint Lead Arrangers and Joint Bookrunners,
BANK OF AMERICA, N.A.,
as Syndication Agent, and
BMO CAPITAL MARKETS CORP., FIFTH THIRD BANK, SG AMERICAS SECURITIES, LLC and PNC CAPITAL MARKETS LLC
as Co-Documentation Agents
Page
TABLE OF CONTENTS
ARTICLE I
Definitions
SECTION 1.01 Defined Terms 1
SECTION 1.02 Classification of Loans and Borrowings 43
SECTION 1.03 Terms Generally 43
SECTION 1.04 Accounting Terms; GAAP 43
SECTION 1.05 Change of Currency 43
SECTION 1.06 Currency Equivalents Generally 44
ARTICLE II
The Credits
SECTION 2.01 Commitments 44
SECTION 2.02 Incremental Revolving Commitments and Incremental Term Loans 45
SECTION 2.03 Procedure for Borrowing 48
SECTION 2.04 Funding of Borrowings 49
SECTION 2.05 Interest Elections 49
SECTION 2.06 Termination and Reduction of Commitments 50
SECTION 2.07 Repayment of Loans; Evidence of Debt 50
SECTION 2.08 Prepayments 51
SECTION 2.09 Fees 53
SECTION 2.10 Interest 54
SECTION 2.11 Alternate Rate of Interest 54
SECTION 2.12 Increased Costs 55
SECTION 2.13 Break Funding Payments 56
SECTION 2.14 Taxes 56
SECTION 2.15 Pro Rata Treatment and Payments 58
SECTION 2.16 Mitigation Obligations; Replacement of Lenders 60
SECTION 2.17 Letters of Credit 61
SECTION 2.18 Defaulting Lenders 65
SECTION 2.19 Extensions of Commitments 66
SECTION 2.20 Refinancing Amendments 68
SECTION 2.21 Loan Repurchases 72
ARTICLE III
Representations and Warranties
SECTION 3.01 Organization; Powers 73
SECTION 3.02 Authorization; Enforceability 73
SECTION 3.03 Governmental Approvals; No Conflicts. 74
SECTION 3.04 Financial Position 74
SECTION 3.05 Properties 74
SECTION 3.06 Litigation and Environmental Matters 74
SECTION 3.07 Compliance with Laws and Agreements. 74
SECTION 3.08 Investment Company Status 75
SECTION 3.09 Taxes 75
SECTION 3.10 ERISA 75
Page
SECTION 3.11 Disclosure 75
SECTION 3.12 Pledge Agreement 75
SECTION 3.13 No Change 75
SECTION 3.14 Guarantors 75
SECTION 3.15 Solvency 75
SECTION 3.16 No Default 76
SECTION 3.17 Anti-Corruption Laws and Sanctions 76
ARTICLE IV
Conditions
SECTION 4.01 Closing Date 76
SECTION 4.02 Each Credit Event 77
ARTICLE V
Affirmative Covenants
SECTION 5.01 Financial Statements; Other Information 78
SECTION 5.02 Notices of Material Events 80
SECTION 5.03 Existence; Conduct of Business 80
SECTION 5.04 Payment of Obligations 80
SECTION 5.05 Maintenance of Properties; Insurance 80
SECTION 5.06 Books and Records; Inspection Rights 81
SECTION 5.07 Compliance with Laws 81
SECTION 5.08 Use of Proceeds 81
SECTION 5.09 Guarantors and Collateral 81
SECTION 5.10 Post-Closing Delivery of Certificated Equity Interests 81
SECTION 5.11 Further Assurances 82
SECTION 5.12 Ratings 82
ARTICLE VI
Negative Covenants
SECTION 6.01 Indebtedness 82
SECTION 6.02 Liens 85
SECTION 6.03 Fundamental Changes 87
SECTION 6.04 Disposition of Property 87
SECTION 6.05 Restricted Payments 88
SECTION 6.06 Transactions with Affiliates 90
SECTION 6.07 Changes in Fiscal Periods 91
SECTION 6.08 Sales and Leasebacks 91
SECTION 6.09 Clauses Restricting Subsidiary Distributions 91
SECTION 6.10 Consolidated Net Leverage Ratio; Interest Coverage Ratio 93
SECTION 6.11 Investments 93
SECTION 6.12 Activities of Match Group, Inc. 94
ARTICLE VII
Events of Default
SECTION 7.01 Events of Default 95
Page
ARTICLE VIII
The Administrative Agent
SECTION 8.01 Appointment and Authorization 97
SECTION 8.02 Administrative Agent and Affiliates 97
SECTION 8.03 Action by Administrative Agent 97
SECTION 8.04 Consultation with Experts 97
SECTION 8.05 Delegation of Duties 98
SECTION 8.06 Successor Administrative Agent 98
SECTION 8.07 Credit Decision 98
SECTION 8.08 Lead Arrangers; Syndication Agent; Co-Documentation Agents 98
SECTION 8.09 Tax Indemnification by the Lenders 98
ARTICLE IX
Miscellaneous
SECTION 9.01 Notices 99
SECTION 9.02 Waivers; Amendments 100
SECTION 9.03 Waivers; Amendments to Other Loan Documents 101
SECTION 9.04 Expenses; Indemnity; Damage Waiver 102
SECTION 9.05 Successors and Assigns 103
SECTION 9.06 Survival 106
SECTION 9.07 Counterparts; Integration; Effectiveness 106
SECTION 9.08 Severability 106
SECTION 9.09 Right of Setoff 106
SECTION 9.10 Governing Law; Jurisdiction; Consent to Service of Process 107
SECTION 9.11 WAIVER OF JURY TRIAL 107
SECTION 9.12 Headings 107
SECTION 9.13 Confidentiality 108
SECTION 9.14 Judgment Currency 108
SECTION 9.15 USA PATRIOT Act 109
SECTION 9.16 Collateral and Guarantee Matters 109
SECTION 9.17 No Advisory or Fiduciary Relationship 109
SECTION 9.18 Platform; Borrower Materials 110
SCHEDULES
Schedule 1.01A -- Commitments
Schedule 1.01B -- Unrestricted Subsidiaries on Closing Date
Schedule 3.01 -- Certain Material Subsidiaries
Schedule 3.06 -- Disclosed Matters
Schedule 3.12 -- Filings
Schedule 3.14 -- Guarantors
Schedule 5.10 -- Post-Closing Delivery of Certificated Equity Interests
Schedule 6.01 -- Existing Indebtedness
Schedule 6.02 -- Existing Liens
Schedule 6.09 -- Existing Restrictions
EXHIBITS
Exhibit A -- Form of Assignment and Assumptions
Exhibit B -- Form of Affiliated Lender Assignment and Assumption
Exhibit C -- Form of Guarantee Agreement
Exhibit D -- Form of Pledge Agreement
Exhibit E -- Form of Secretary Certificate
Exhibit F -- [Reserved]
Exhibit G-1 -- Form U.S. Tax Certificate (For Non-U.S. Lenders That Are Not Partnerships For U.S. Federal
Exhibit G-2 -- Form U.S. Tax Certificate (For Non-U.S. Lenders That Are Partnerships For U.S. Federal
Income Tax Purposes)
Income Tax Purposes)
Exhibit G-3 -- Form U.S. Tax Certificate (For Non-U.S. Participants That Are Not Partnerships For U.S.
Federal Income Tax Purposes)
Exhibit G-4 -- Form U.S. Tax Certificate (For Non-U.S. Participants That Are Partnerships For U.S. Federal
Income Tax Purposes)
Exhibit H -- Form of Perfection Certificate
Exhibit I -- Form of Solvency Certificate
Exhibit J -- [Reserved]
Exhibit K -- Auction Procedures
AMENDED AND RESTATED CREDIT AGREEMENT, dated as of October 7, 2015 and as amended and restated as of November 16, 2015 (as further
amended, restated, extended, supplemented or otherwise modified from time to time, this “ Ag reement ”), among MATCH GROUP, INC., a Delaware corporation
(the “ Bo rrower ”), the LENDERS party hereto from time to time, JPMORGAN CHASE BANK, N.A., as administrative agent for the Lenders and as collateral
agent for the Secured Parties (as defined herein) (in such capacities, the “ Ad ministrative Agent ”) and as an Issuing Bank.
The parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01 Defined Terms . As used in this Agreement, the following terms have the meanings specified below:
“ ABR ” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans com- prising such Borrowing, are bearing interest at
a rate determined by reference to the Alternate Base Rate.
“ Act ” has the meaning assigned to such term in Section 9.15.
“ Adjustment Date ” has the meaning assigned to such term in the definition of “Pricing Grid.”
“ Administrative Agent ” means JPMorgan Chase Bank, N.A. (including its branches and affiliates), in its capacity as administrative agent for the Lenders
hereunder and, as applicable (including, for the avoidance of doubt, each reference to the Administrative Agent in Article VIII), as Collateral Agent, together with
any successors in such capacities.
“ Administrative Questionnaire ” means an Administrative Questionnaire in a form supplied by the Administrative Agent.
“ Affiliate ” means, with respect to a specified 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.
“ Affiliated Lender ” means, at any time, any Lender that is an Affiliate of the Borrower (other than any of its subsidiaries) at such time.
“ Affiliated Persons ” means, with respect to any specified Person, (a) such specified Person’s parents, spouse, siblings, descendants, step children, step
grandchildren, nieces and nephews and their respective spouses, (b) the estate, legatees and devisees of such specified Person and each of the Persons referred to in
clause (a), and (c) any company, partnership, trust or other entity or investment vehicle Controlled by any of the Persons referred to in clause (a) or (b) or the
holdings of which are for the primary benefit of any of such Persons.
“ Agent Party ” means the Administrative Agent, the Issuing Bank or any other Lender.
“ Aggregate Exposure ” means, with respect to any Lender at any time, the sum of (a) the aggregate then outstanding principal amount of such Lender’s
Term Loans and (b) the amount of such Lender’s Revolving Com- mitment then in effect or, if such Revolving Commitment has been terminated, such Lender’s
Outstanding Revolv- ing Credit.
“ Agreement ” has the meaning assigned to such term in the preamble to this Credit Agreement.
“ Agreement Currency ” has the meaning assigned to such term in Section 9.14.
1
“ All-in Yield ” means, as to any Loans (or other Indebtedness, if applicable), the yield thereon to Lenders (or other lenders, as applicable) providing such
Loans (or other Indebtedness, if applicable) in the primary syndica- tion thereof, as reasonably determined by the Administrative Agent in consultation with the
Borrower, whether in the form of interest rate, margin, original issue discount, up-front fees, rate floors or otherwise; provided , that original issue discount and up-
front fees shall be equated to interest rate based on an assumed four year average life; and provided , further , that “All-in Yield” shall not include arrangement,
commitment, underwriting, structuring or similar fees and customary consent fees for an amendment paid generally to consenting lenders.
“ Alternate Base Rate ” means, for any day, a rate per annum equal to the highest of (a) the Prime Rate in ef- fect on such day, (b) the Federal Funds
Effective Rate in effect on such day plus ½ of 1% and (c) the Eurocurrency Rate that would be calculated as of such day (or, if such day is not a Business Day, as of
the next preceding Business Day) in respect of a proposed Eurocurrency Borrowing in Dollars with a one-month Interest Period plus 1.00%.
Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or such Eurocurrency Rate shall be effective from and
including the effective date of such change in the Prime Rate, the Federal Funds Effective Rate or such Eurocurrency Rate, respectively.
“ Alternative Currency ” means Sterling, Yen, Euro, Australian Dollar or Canadian Dollar.
“ Alternative Currency Revolving Sublimit ” means, with respect to all Alternative Currencies, the Dollar Amount of $100,000,000.
“ Anti-Corruption Laws ” means the United States Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder and the
Bribery Act 2010 of the United Kingdom, as amended.
“ Applicable Rate ” means (a) for each Revolving Loan, (i) prior to the first Adjustment Date occurring after the Closing Date, 2.00% for Eurocurrency
Loans and 1.00% for ABR Loans and (ii) on and after the first Adjustment Date occurring after the Closing Date, a percentage determined in accordance with the
Pricing Grid, (b) for each Term B-1 Loan, 4.50% for Eurocurrency Loans and 3.50% for ABR Loans and (c) for each Type of Incremental Term Loan, such per
annum rates as shall be agreed to by the Borrower and the applicable Incremental Term Lenders as shown in the applicable Incremental Assumption Agreement.
“ Applicable Time ” means, with respect to any Borrowings and payments in any Alternative Currency the local time in the place of settlement for such
Alternative Currency, as may be reasonably determined by the Administrative Agent to be necessary for timely settlement on the relevant date in accordance with
normal banking procedures in the place of payment and notified to the relevant parties hereto.
“ Approved Fund ” has the meaning assigned to such term in Section 9.05(b).
“ Asset Acquisition ” means:
(1) an Investment by the Borrower or any Restricted Subsidiary in any other Person if, as a result of such Investment, such Person shall become
a Restricted Subsidiary, or shall be merged with or in- to the Borrower or any Restricted Subsidiary, or
(2) the acquisition by the Borrower or any Restricted Subsidiary of all or substantially all of the assets of any other Person or any division or line
of business of any other Person.
“ Asset Sale ” means any sale, issuance, conveyance, transfer, lease, assignment or other disposition by the Borrower or any Restricted Subsidiary to any
Person other than the Borrower or any Restricted Subsidiary (includ- ing by means of a sale and leaseback transaction or a merger or consolidation) (collectively, for
purposes of this definition, a “ transfer ”), in one transaction or a series of related transactions, of any assets of the Borrower or any of its Restricted Subsidiaries
other than in the ordinary course of business. For purposes of this definition, the term “Asset Sale” shall not include:
(1)
transfers of cash or Cash Equivalents;
2
(2)
(3)
(4)
(5)
transfers of assets (including Equity Interests) that are governed by, and made in accord- ance with, Section 6.03;
Restricted Payments permitted under the covenant described under Section 6.05 and In- vestments not prohibited by Section 6.11;
the creation of any Lien permitted under this Agreement;
transfers of assets that are (i) damaged, worn out, uneconomic, obsolete or otherwise deemed to be no longer necessary or useful in
the current or anticipated business of the Borrower or its Re- stricted Subsidiaries or (ii) replaced by assets of similar suitability and value;
(6)
sales or grants of licenses or sublicenses to use the patents, trade secrets, know-how and other intellectual property, and licenses,
leases or subleases of other assets, of the Borrower or any Restrict- ed Subsidiary to the extent not materially interfering with the business of the Borrower
and the Restricted Subsidiaries;
(7)
any transfer or series of related transfers that, but for this clause, would be Asset Sales, if the aggregate Fair Market Value of the
assets transferred in such transaction or any such series of related transactions does not exceed (x) prior to the Term B-1 Loan Repayment Date,
$50,000,000 and (y) on or after the Term B-1 Loan Repayment Date, $150,000,000, in each case for such transaction or any such se- ries of related
transactions;
(8)
(9)
transfers in connection with the Match Transactions; and
at any time prior to the Term B-1 Loan Repayment Date, transfers of assets of the Princeton Review Group and the Tutor.com Group.
“ Asset Swap ” means any exchange of assets of the Borrower or any Restricted Subsidiary (including Equity Interests of a Restricted Subsidiary) for assets
of another Person (including Equity Interests of a Person whose primary business is a Related Business) that are intended to be used by the Borrower or any
Restricted Subsidiary in a Related Business, including, to the extent necessary to equalize the value of the assets being exchanged, cash of any party to such asset
swap.
“ Assignment and Assumption ” means an assignment and assumption entered into by a Lender and an as- signee (with the consent of any party whose
consent is required by Section 9.05), and accepted by the Administra- tive Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.
“ Auction Manager ” has the meaning assigned to such term in Section 2.21(a).
\
“ Auction Procedures ” means auction procedures with respect to Purchase Offers set forth in Exhibit K hereto.
“ Australian Dollar ” means the lawful currency of Australia.
“ Australian Dollar Bank Bill Reference Rate ” means for any Loans in Australian Dollars, the Australian Dollar Screen Rate or, if applicable pursuant to
the terms of Section 2.11(a), the applicable Reference Bank Rate.
“ Australian Dollar Screen Rate ” means, with respect to any Interest Period, the average bid reference rate as administered by the Australian Financial
Markets Association (or any other Person that takes over the administration of that rate) for Australian Dollar bills of exchange with a tenor equal in length to such
Interest Period, as dis- played on page BBSY of the Reuters screen or, in the event such rate does not appear on such Reuters page, on any successor or substitute
page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate as selected by the Administrative
Agent from time to time in its reasonable discretion.
3
“ Available Revolving Commitment ” means, as to any Revolving Lender at any time, an amount equal to the excess, if any, of (a) such Lender’s
Revolving Commitment then in effect at such time over (b) such Lender’s Outstanding Revolving Credit.
“ Bankruptcy Event ” means, with respect to any Lender, such Lender or any other Person as to which such Lender is a subsidiary (a “ Parent Company ”)
(i) is adjudicated as, or determined by any Governmental Authority having regulatory authority over it or its assets to be, insolvent, (ii) becomes the subject of a
bankruptcy or insolvency proceeding, or the Administrative Agent has given written notice to such Lender and the Borrower of its good faith determination that such
Lender or its Parent Company has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or (iii) has
had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of
its business appointed for it, or the Administrative Agent has given written notice to such Lender and the Borrower of its good faith determination that such Lender
or its Parent Company has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such appointment; provided that a
Bankruptcy Event shall not result solely by virtue of any control of or ownership interest in, or the acquisition of any control of or ownership interest in, such Lender
or its Parent Company by a Governmental Authority as long as such control or ownership interest does not result in or provide such Lender or its Parent Company
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 its Parent Company (or such Governmental Authority) to reject, repudiate, disavow or disaffirm such Lender’s obligations under this Agreement.
“ Basel III ” means, collectively, those certain agreements on capital requirements, leverage ratios and
liquidity standards contained in “Basel III: A Global Regulatory Framework for More Resilient Banks and Banking Systems,” “Basel III: International Framework for
Liquidity Risk Measurement, Standards and Monitoring,” and “Guidance for National Authorities Operating the Countercyclical Capital Buffer,” each as published by
the Basel Committee on Banking Supervision in December 2010 (as revised from time to time), and as implemented by a Lender’s primary U.S. federal banking
regulatory authority or primary non-U.S. financial regulatory authority, as applicable.
“ Board ” means the Board of Governors of the Federal Reserve System of the United States of America.
“ Board of Directors ” means the Board of Directors of the Borrower or, other than for the purposes of the definition of “Change of Control,” any
committee thereof duly authorized to act on behalf of such Board of Direc- tors.
“ Borrower ” means Match Group, Inc., a Delaware corporation.
" Borrower Materials ” has the meaning assigned to such term in Section 9.18.
“ Borrowing ” means a group of Loans of the same Type, made, converted or continued on the same date and, in the case of Eurocurrency Loans, as to
which a single Interest Period is in effect.
“ Borrowing Date ” means any Business Day specified by the Borrower as a date on which the Borrower re- quests the relevant Lenders to make Loans
hereunder.
“ Business Day ” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by
law to remain closed; provided that when used in connection with (a) a Eurocurrency Loan denominated in Dollars, the term “Business Day” shall also exclude any
day on which banks are not open for dealings in Dollar deposits in the London interbank market, (b) any Borrowings or LC Disbursements that are the subject of a
borrowing, drawing, payment, reimbursement or rate selection denominated in Euro, the term “Business Day” shall also exclude any day on which the Trans-
European Real-time Gross Settlement Operating System (or any successor operating system) is not open for the settlement of payments in Euro and (c) a Euro-
currency Loan denominated in an Alternative Currency, the term “Business Day” shall also exclude any day on which banks are not open for dealings in such
Alternative Currency deposits in the interbank market in the principal financial center of the country whose lawful currency is such Alternative Currency.
4
“ Canadian Dollar ” means the lawful currency of Canada.
“ Capital Expenditures ” means, for the Borrower and its Restricted Subsidiaries in respect of any period, the aggregate of all expenditures incurred by such
person during such period that, in accordance with GAAP, are or should be included in “additions to property, plant or equipment” or similar items reflected in the
statement of cash flows of such person; provided, however, that Capital Expenditures for the Borrower and its Restricted Subsidiaries shall not include:
(a)
expenditures to the extent made with proceeds of the issuance of Qualified Equity Interests of the Bor- rower or capital contributions to the Borrower
or funds that would have constituted Net Proceeds under clause (a) of the definition of the term “Net Proceeds” (but that will not constitute Net Proceeds as a result
of the first or second proviso to such clause (a));
(b)
expenditures of proceeds of insurance settlements, condemnation awards and other settlements in re- spect of lost, destroyed, damaged or
condemned assets, equipment or other property to the extent such expenditures are made to replace or repair such lost, destroyed, damaged or condemned assets,
equipment or other property or otherwise to acquire, maintain, develop, construct, improve, upgrade or repair assets or properties useful in the business of the
Borrower and its Restricted Subsidiaries to the extent such proceeds are not then required to be applied to prepay Term Loans pursuant to Section 2.08(c)(1);
(c) interest capitalized during such period;
(d)
expenditures that are accounted for as capital expenditures of such person and that actually are paid for by a third party (excluding the Borrower or
any Restricted Subsidiary) and for which none of the Borrower or any Restricted Subsidiary has provided or is required to provide or incur, directly or indirectly,
any consideration or ob- ligation to such third party or any other person (whether before, during or after such period);
(e)
the book value of any asset owned by such person 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 that such expenditure actually is made and (ii) such book value shall have been included in Capital Expenditures when such asset was originally
acquired;
(f)
the purchase price of equipment purchased during such period to the extent that the consideration there- for consists of any combination of (i) used or
surplus equipment traded in at the time of such purchase, (ii) the pro- ceeds of a concurrent sale of used or surplus equipment, in each case, in the ordinary course of
business or (iii) any Asset Swap;
(g) Investments in respect of an Asset Acquisition; or
(h)
the purchase of property, plant or equipment made with proceeds from any Asset Sale or Recovery Event to the extent such proceeds are not then
required to be applied to prepay Term Loans pursuant to Section 2.08(c)(1).
“ Capital Lease Obligations ” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement
conveying the right to use) real or personal property, or a combi- nation thereof, which obligations are required to be classified and accounted for as capital leases on
a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP;
provided, however , that any obligations relating to a lease that would have been account- ed by such Person as an operating lease in accordance with GAAP as of
the Closing Date shall be accounted for as an operating lease and not a Capital Lease Obligation for all purposes under this Agreement.
“ Cash Equivalents ” means (1) marketable direct obligations issued by, or unconditionally guaranteed by, the United States government or issued by any
agency thereof and backed by the full faith and credit of the United
5
States, in each case maturing within one year from the date of acquisition; (2) certificates of deposit, time deposits, eurodollar time deposits or overnight bank
deposits having maturities of one year or less from the date of acquisition issued by any commercial bank organized under the laws of the United States or any state
thereof or any Lender or any Affiliate of any Lender; (3) commercial paper of an issuer rated at least A-1 by Standard & Poor’s or P-1 by Moody’s, or carrying an
equivalent rating by a nationally recognized rating agency, if both of the two named rating agencies cease publishing ratings of commercial paper issuers generally,
and maturing within one year from the date of acquisition; (4) repurchase obligations of any commercial bank satisfying the requirements of clause (2) of this
definition with respect to securities issued or fully guaranteed or insured by the United States government; (5) securities with maturities of one year or less from the
date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any
such state, commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or
foreign government (as the case may be) are rated at least A by Standard & Poor’s or A by Moody’s; (6) securities with maturities of one year or less from the date
of acquisition backed by standby letters of credit issued by any commercial bank satisfying the requirements of clause (2) of this definition;
(7) money market mutual or similar funds that invest exclusively in assets satisfying the requirements of clauses (1) through (6) of this definition; (8) money
market funds that (i) comply with the criteria set forth in SEC Rule 2a-7 under the Investment Company Act of 1940, as amended, (ii) are rated AAA by Standard &
Poor’s or Aaa by Moody’s and (iii) have portfolio assets of at least $5,000,000,000; and (9) in the case of any Foreign Subsidiary, investments substantially
comparable to any of the foregoing investments with respect to the country in which such Foreign Subsidiary is organized.
“ Cash Management Agreement ” means any agreement entered into from time to time by the Borrower or any Restricted Subsidiary in connection with
Cash Management Services for collections, other Cash Management Services or for operating, payroll and trust accounts of such Person, including automatic
clearing house services, controlled disbursement services, electronic funds transfer services, information reporting services, lockbox ser- vices, stop payment services
and wire transfer services, unless, when entered into, such agreement is designated in writing by the Borrower and the relevant Cash Management Bank to the
Administrative Agent to not be included as a Cash Management Agreement.
“ Cash Management Bank ” means any Person that (i) at the time it enters into a Cash Management Agree- ment or provides any Cash Management
Services, is a Lender or an Agent Party or an Affiliate of a Lender or an Agent Party or (ii) in the case of any Cash Management Agreement in effect or any Cash
Management Services provided, on or prior to the Closing Date, is, as of the Closing Date, a Lender or an Agent Party or an Affiliate of a Lender or an Agent Party
and a party to a Cash Management Agreement or provider of Cash Management Services.
“ Cash Management Obligations ” means obligations owed by the Borrower or any Subsidiary Guarantor to any Cash Management Bank in connection
with, or in respect of, any Cash Management Services.
“ Cash Management Services ” means (a) commercial credit cards, merchant card services, purchase or debit cards, including non-card e-payables services,
(b) treasury management services (including controlled disbursement, overdraft automatic clearing house fund transfer services, return items and interstate
depository network services) and (c) any other demand deposit or operating account relationships or other cash management services, including under any Cash
Management Agreements.
“ CDOR Rate ” means for any Loans in Canadian Dollars, the CDOR Screen Rate or, if applicable pursuant to the terms of Section 2.11(a), the applicable
Reference Bank Rate.
“ CDOR Screen Rate ” means, with respect to any Interest Period, the average rate for bankers acceptances as administered by the Investment Industry
Regulatory Organization of Canada (or any other Person that takes over the administration of that rate) with a tenor equal in length to such Interest Period, as
displayed on CDOR page of the Reuters screen or, in the event such rate does not appear on such Reuters page, on any successor or substitute page on such screen or
service that displays such rate, or on the appropriate page of such other information service that publishes such rate as shall be selected from time to time by the
Administrative Agent in its reasonable discretion.
6
“CFC” means a “controlled foreign corporation” within the meaning of Section 957 of the Code.
“Change in Law ” means (a) the adoption of any law, rule, regulation or treaty after the Closing Date, (b) any change in any law, rule, regulation or treaty
or in the interpretation or application thereof by any Governmental Authority after the Closing Date or (c) compliance by any Lender (or, for purposes of Section
2.12(b), by any lending office of such Lender or by such Lender’s holding company, if any) with any request, guideline or directive (whether or not having the force
of law) of any Governmental Authority made or issued after the Closing Date; provided that, notwithstanding anything herein to the contrary, (x) the Dodd-Frank
Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests,
rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar
authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law,” but only to
the extent it is the general policy of a Lender to impose applicable increased costs or costs in connection with capital adequacy requirements similar to those
described in clauses (a) and (b) of Section 2.12 generally on other similarly situated borrowers under similar circumstances under agreements permitting such
impositions.
“ Change of Control ” means any of the following events:
(a)
the sale, lease or transfer, in one or a series of related transactions, of all or substantially all of the assets of the Borrower and its
subsidiaries, taken as a whole, to any Person other than a Permitted Holder;
(b)
the acquisition of beneficial ownership by any person or group (excluding any one or more Permitted Holders or group Controlled by
any one or more Permitted Holders) of more than 35% of the aggregate voting power of all outstanding classes or series of the Borrower’s Voting Stock
and such aggregate voting power exceeds the aggregate voting power of all outstanding classes or series of the Bor- rower’s Voting Stock beneficially
owned by the Permitted Holders collectively;
(c)
during any period of two consecutive years, individuals who at the beginning of such pe- riod constituted the Board of Directors of
the Borrower (together with any new directors whose election by the Board of Directors or whose nomination for election by the equityholders of the
Borrower was ap- proved by a vote of the majority of the directors of the Borrower then still in office who were either direc- tors at the beginning of such
period or whose election or nomination for election was previously so ap- proved) cease for any reason to constitute a majority of the Borrower’s Board of
Directors then in office;
or
(d)
(e)
the Borrower shall adopt a plan of liquidation or dissolution or any such plan shall be ap- proved by the stockholders of the Borrower;
a “change of control triggering event” (or similar event) shall occur in any document per- taining to the Senior Notes or any
Refinancing Indebtedness thereof, in each case, to the extent constituting Material Indebtedness.
Notwithstanding the foregoing, a transaction in which the Borrower becomes a subsidiary of another Person (other than a Person that is an individual or a Permitted
Holder) shall not constitute a Change of Control if the shareholders of the Borrower immediately prior to such transaction beneficially own, directly or indirectly
through one or more intermediaries, the same proportion of voting power of the outstanding classes or series of the Borrower’s voting stock as such shareholders
beneficially own immediately following the consummation of such transaction.
For purposes of this definition, a Person shall not be deemed to have beneficial ownership of securities sub- ject to a stock purchase agreement, merger
agreement or similar agreement until the consummation of the transac- tions contemplated by such agreement.
“ CIM ” means the Confidential Information Memorandum dated October 27, 2015 and made available to the Lenders in connection with the Lender
meeting held on October 27, 2015 with respect to the Term Facility and this Agreement.
7
“ Class ” (a) when used in reference to any Loans or Borrowing, refers to whether such Loans or the Loans comprising such Borrowing, are Revolving
Loans, Term B-1 Loans, Incremental Term Loans established pursuant to any Incremental Assumption Agreement, Extended Term Loans or Extended Revolving
Loans established pursu- ant to any Extension Amendment or Refinancing Term Loans or Replacement Revolving Loans established pursuant to any Refinancing
Amendment or (b) when used in reference to any Commitments, refers to whether such Com- mitment is in respect of a commitment to make Revolving Loans,
Term B-1 Loans, Incremental Term Loans estab- lished pursuant to any Incremental Assumption Agreement, Extended Term Loans or Extended Revolving Loans
established pursuant to any Extension Amendment or Refinancing Term Loans or Replacement Revolving Loans established pursuant to any Refinancing
Amendment.
“ Closing Date ” means the date on which the conditions precedent set forth in Section 4.01 shall have been satisfied (or waived in accordance with Section
9.02).
“ Code ” means the Internal Revenue Code of 1986, as amended from time to time.
“ Co-Documentation Agents ” means BMO Capital Markets Corp., Fifth Third Bank, SG Americas Securi- ties, LLC and PNC Capital Markets LLC.
“ Collateral ” has the meaning assigned to such term or a similar term in each of the Collateral Documents and shall include all property pledged or granted
(or purported to be pledged or granted) as collateral pursuant to the Pledge Agreement on the Closing Date or thereafter pursuant to Section 5.09.
“ Collateral Agent ” means JPMorgan Chase Bank, N.A. in its capacity as collateral agent under the Guaran- tee Agreement and the Collateral Documents
for the Secured Parties.
“ Collateral Documents ” means the Pledge Agreement and each other security document, mortgage, pledge agreement or collateral agreement executed and
delivered in connection with this Agreement and/or the other Loan Documents to grant a security interest in any property as collateral to secure the Obligations.
“ Commitment ” means, with respect to each Lender (to the extent applicable), such Lender’s Incremental Commitment, Revolving Commitment, Term
Loan Commitment or Extended Revolving Commitment, as applica- ble.
“ Commitment Fee Rate ” means (a) prior to the first Adjustment Date occurring after the Closing Date, 0.35% and (b) on and after the first Adjustment
Date occurring after the Closing Date, a rate determined in accord- ance with the Pricing Grid.
“ 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.
“ Consolidated Amortization Expense ” for any Test Period means the amortization expense of the Borrower and its Restricted Subsidiaries for such Test
Period, determined on a consolidated basis in accordance with GAAP.
“ Consolidated Contingent Consideration Fair Value Remeasurement Adjustments ” for any period means the contingent consideration fair value
remeasurement adjustments, of the Borrower and its Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.
“ Consolidated Depreciation Expense ” for any Test Period means the depreciation expense of the Borrower and its Restricted Subsidiaries for such Test
Period, determined on a consolidated basis in accordance with GAAP.
“ Consolidated EBITDA ” for any Test Period means, without duplication, the sum of the amounts for such Test Period of
(1)
Consolidated Net Income, plus
8
(2)
in each case only to the extent (and in the same proportion) deducted in determining Consolidated Net Income,
(a)
(b)
(c)
(d)
(e)
(f)
Consolidated Income Tax Expense,
Consolidated Amortization Expense,
Consolidated Depreciation Expense,
Consolidated Interest Expense,
all non-cash compensation, as reported in the Borrower’s financial statements,
any non-cash charges or losses or realized losses related to the write-offs, write- downs or mark-to-market adjustments or
sales or exchanges of any investments in debt or equity securities by the Borrower or any Restricted Subsidiary,
(g)
the aggregate amount of all other non-cash charges, expenses or losses reducing such Consolidated Net Income, including
any impairment (including any impairment of intangi- bles and goodwill) (excluding any non-cash charge, expense or loss that results in an
accrual of a reserve for cash charges in any future period and any non-cash charge, expense or loss relating to write-offs, write downs or reserves
with respect to accounts receivable or inventory), for such Test Period, and
(h)
the amount of any restructuring charges or reserves, including any one-time costs incurred in connection with acquisitions,
minus
(3)
in each case only to the extent (and in the same proportion) included in determining Consolidated Net Income, any non-cash or
realized gains related to mark-to-market adjustments or sales or ex- changes of any investments in debt or equity securities by the Borrower or any
Restricted Subsidiary,
in each case determined on a consolidated basis in accordance with GAAP; provided that the aggregate amount of all non-cash items, determined on a consolidated
basis, to the extent such items increased Consolidated Net Income for such period will be excluded from Consolidated Net Income.
For purposes of this definition, whenever pro forma effect is to be given, the pro forma calculations shall be factually supportable, reasonably identifiable
and made in good faith by a Financial Officer. Any such pro forma calculation may include adjustments appropriate, in the reasonable good faith determination of
the Borrower as set forth in an Officer’s Certificate, to reflect cost savings and other operating improvements or synergies reasonably expected to be realized within
12 months from the applicable event to be given pro forma effect; provided that the aggregate amount of all items added back to Consolidated EBITDA pursuant to
this paragraph and clause (A)(2) of the definition of “Consolidated Net Leverage Ratio” shall not exceed 10.0 % of Consolidated EBITDA (prior to giving effect to
such adjustment) for such Test Period.
“ Consolidated Income Tax Expense ” for any Test Period means the provision for taxes of the Borrower and its Restricted Subsidiaries for such Test
Period, determined on a consolidated basis in accordance with GAAP.
“ Consolidated Interest Expense ” for any Test Period means the sum, without duplication, of the total inter- est expense of the Borrower and its Restricted
Subsidiaries for such Test Period, determined on a consolidated basis in accordance with GAAP, minus consolidated interest income of the Borrower and its
Restricted Subsidiaries, and including, without duplication,
(1)
imputed interest on Capital Lease Obligations,
9
(2)
commissions, discounts and other fees and charges owed with respect to letters of credit securing financial obligations, bankers’
acceptance financing and receivables financings,
(3)
(4)
(5)
(6)
(7)
(8)
the net costs associated with Hedging Obligations related to interest rates,
amortization of debt issuance costs, debt discount or premium and other financing fees and expenses,
the interest portion of any deferred payment obligations,
all other non-cash interest expense,
capitalized interest,
all dividend payments on any series of Disqualified Equity Interests of the Borrower or any Preferred Stock of any Restricted
Subsidiary (other than any such Disqualified Equity Interests or any Preferred Stock held by the Borrower or a Restricted Subsidiary of the Borrower that is
a Wholly Owned Subsidiary or to the extent paid in Qualified Equity Interests),
(9)
all interest payable with respect to discontinued operations, and
(10) all interest on any Indebtedness described in clause (6) or (7) of the definition of “Indebtedness",
but excluding, without duplication, interest on any Pre-IPO Note.
“ Consolidated Net Income ” for any Test Period means the net income (or loss) of the Borrower and the Restricted Subsidiaries for such Test Period
determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from such net income (to the extent otherwise included therein),
without duplication:
(1)
the net income (or loss) of any Person that is not a Restricted Subsidiary, except to the extent that cash in an amount equal to any such
income has actually been received by the Borrower or any Restricted Subsidiary during such period;
(2)
(3)
(4)
(5)
gains and losses due solely to fluctuations in currency values and the related tax effects according to GAAP;
gains and losses with respect to Hedging Obligations;
the cumulative effect of any change in accounting principles;
any extraordinary or nonrecurring gain (or extraordinary or nonrecurring loss), together with any related provision for taxes on any
such extraordinary or nonrecurring gain (or the tax effect of any such extraordinary or nonrecurring loss), realized by the Borrower or any Restricted
Subsidiary during such period;
(6)
(7)
operations; and
Consolidated Contingent Consideration Fair Value Remeasurement Adjustments;
any net after-tax income or loss from discontinued operations and any net after-tax gains or losses on disposal of discontinued
(8)
any gain (or loss), together with any related provisions for taxes on any such gain (or the tax effect of any such loss), realized during
such period by the Borrower or any Restricted Subsidiary upon (a) the acquisition of any securities, or the extinguishment of any Indebtedness, of the
Borrower or any Re-
stricted Subsidiary or (b) the sale of any financial or equity investment by the Borrower or any Restricted Subsidiary;
10
provided , further , that the effects of any adjustments in the inventory, property and equipment, software, goodwill, other intangible assets, in-process research and
development, deferred revenue, debt line items, any earn-out obligations and any other non-cash charges (other than the amortization of unfavorable operating
leases) in the Borrower’s consolidated financial statements pursuant to GAAP in each case resulting from the application of purchase accounting in relation to any
consummated acquisition or the amortization or write-off of any such amounts shall be excluded when determining Consolidated Net Income.
“ Consolidated Net Leverage Ratio ” means, as of any date of determination, the ratio of (a) Indebtedness of the Borrower and its Restricted Subsidiaries as
of the last day of the Test Period most recently ended on or prior to such date of determination (as set forth on the balance sheet and determined on a consolidated
basis in accordance with GAAP (but excluding, any Pre-IPO Note) minus the amount of unrestricted cash and Cash Equivalents of the Borrower and its Restricted
Subsidiaries on such date in an amount not to exceed (x) prior to the Term B-1 Loan Repayment Date, $100,000,000 (or, solely with respect to calculating the
Consolidated Net Leverage Ratio for pur- poses of (i) incurring Permitted Unsecured Ratio Debt, unsecured Indebtedness pursuant to Section 6.01(g) and un-
secured Indebtedness pursuant to Section 6.01(z), (ii) the Match Transaction Distributions and (iii) the Pricing Grid and actual compliance (and not pro forma
compliance or compliance on a pro forma basis) with Section 6.10, $200,000,000) and (y) on or after the Term B-1 Loan Repayment Date, $200,000,000 to (b)
Consolidated EBITDA for such Test Period.
(A)
The Consolidated Net Leverage Ratio shall be calculated for any period after giving effect on a pro forma basis (as if they had occurred on the
first day of the applicable Test Period) to:
(1)
the incurrence of any Indebtedness of the Borrower or any Restricted Subsidiary (and the application of the proceeds thereof) and any
repayment, repurchase, defeasance or other discharge of In- debtedness (and the application of the proceeds therefrom) (other than the incurrence or
repayment of In- debtedness in the ordinary course of business for working capital purposes pursuant to any revolving credit arrangement) occurring during
the applicable Test Period or (except when calculating the Consolidated Net Leverage Ratio for purposes of determining the Applicable Rate or
determining actual compliance (and not pro forma compliance or compliance on a pro forma basis) with Section 6.10) at any time subsequent to the last
day of such Test Period and on or prior to the date of determination, as if such incurrence, repay- ment, issuance or redemption, as the case may be (and the
application of the proceeds thereof), occurred on the first day of the Test Period; and
(2)
any (w) Asset Sale, (x) asset sale if the Fair Market Value of the assets sold in such trans- action or series of related transactions
exceeds $2,000,000, which is solely excluded from the definition of Asset Sale pursuant to clause (7) of such definition, (y) Asset Acquisition (including,
without limitation, any Asset Acquisition giving rise to the need to make such calculation as a result of the Borrower or any Restricted Subsidiary
(including any Person who becomes a Restricted Subsidiary as a result of such Asset Acquisition or as a result of a Revocation) incurring Acquired
Indebtedness and also including any Consol- idated EBITDA associated with any such Asset Acquisition) or (z) operational restructuring (each a “ pro
forma event ”) (including any cost savings and synergies resulting from head count reduction, closure of fa- cilities and similar operational and other cost
savings and synergies relating to such pro forma event occur- ring within 12 months (or expected, in the good faith determination of the Borrower, to occur
within 12 months) of such pro forma event and during such period or (except when calculating the Consolidated Net Leverage Ratio for purposes of
determining the Applicable Rate or determining actual compliance (and not pro forma compliance or compliance on a pro forma basis) with Section 6.10)
subsequent to such period and on or prior to the date of such calculation, in each case that are expected to have a continuing impact and are factually
supportable, and which adjustments the Borrower determines are reasonable as set forth in an Officer’s Certificate; provided that the aggregate amount of
all such cost savings and synergies pursuant to this clause (A)(2) and the second paragraph of the definition of “Consolidated EBITDA” shall in no event
exceed 10 % of Consolidated EBITDA for such period calculated prior to giving effect to such pro forma adjustments) occurring during the Test Period or
at any time subsequent to the last day of the Test
11
Period and on or prior to the date of determination, as if such pro forma event occurred on the first day of the Test Period and; provided , further that asset
sales described in clause (A)(2)(x) in an aggregate amount not to exceed $50,000,000 in any Test Period shall not be required to be given pro forma effect;
and
(B)
given pro forma effect:
in calculating Consolidated Interest Expense for purposes of the Consolidated Net Leverage Ratio with respect to any Indebtedness being
(1) interest on outstanding Indebtedness determined on a fluctuating basis as of the date of determination and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such Indebtedness in effect on the date of
determination;
(2) if interest on any Indebtedness actually incurred on the date of determination may option- ally be determined at an interest rate based upon a
factor of a prime or similar rate, a eurocurrency inter- bank offered rate, or other rates, then the interest rate in effect on the date of determination will be
deemed to have been in effect during the Test Period;
(3) notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a fluctuating basis, to the extent such interest is covered by
agreements relating to Hedging Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of the agreements
governing such Hedging Obligations;
(4) interest on any Indebtedness under a revolving credit facility shall be computed based upon the average daily balance of such Indebtedness
during the Test Period; and
(5) interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate rea- sonably determined by a responsible financial or
accounting Officer of the Borrower to be the rate of inter- est implicit in such Capital Lease Obligation in accordance with GAAP.
" Consolidated Working Capital ” means, with respect to the Borrower and its Restricted Subsidiaries on a consolidated basis at any date of determination,
Current Assets at such date of determination minus Current Liabili- ties at such date of determination; provided that increases or decreases in Consolidated Working
Capital shall be calculated without regard to any changes in Current Assets or Current Liabilities as a result of (a) any reclassifica- tion in accordance with GAAP of
assets or liabilities, as applicable, between current and noncurrent or (b) the ef- fects of purchase accounting.
“ Contractual Obligation ” means, as to any Person, any provision of any security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its property is bound.
“ Control ” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise. “ Controlling ” and “ Controlled ” have meanings correlative thereto.
“ Current Assets ” means, with respect to the Borrower and its Restricted Subsidiaries on a consolidated ba- sis at any date of determination, all assets
(other than cash, Cash Equivalents or other cash equivalents) that would, in accordance with GAAP, be classified on a consolidated balance sheet of the Borrower
and its Restricted Subsidi- aries as current assets at such date of determination, other than amounts related to current or deferred taxes based on income or profits.
“ Current Liabilities ” means, with respect to the Borrower and its Restricted Subsidiaries on a consolidated basis at any date of determination, all liabilities
that would, in accordance with GAAP, be classified on a consolidated balance sheet of the Borrower and its Restricted Subsidiaries as current liabilities at such date
of determination, other than (a) the current portion of any Indebtedness, (b) accruals of Consolidated Interest Expense (excluding Consolidated Interest Expense that
is due and unpaid), (c) accruals for current or deferred taxes based on income or
12
profits, (d) accruals, if any, of transaction costs resulting from the Transactions, (e) accruals of any costs or expenses related to (i) severance or termination of
employees prior to the Closing Date or (ii) bonuses, pension and other post- retirement benefit obligations, and (f) accruals for exclusions from Consolidated Net
Income included in clause (5) of the definition of such term.
“ Default ” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived,
become an Event of Default.
“Defaulting Lender ” means any Lender that (a) has failed, within two Business Days of the date required to be funded or paid, to (i) fund any portion of its
Loans, (ii) fund any portion of its participations in Letters of Credit or (iii) pay over to any Agent Party any amount required to be paid by it hereunder, unless, in the
case of clause (i) above, such Lender notifies the Administrative Agent and the Borrower in writing that such failure is the result of such Lender’s good faith
determination that a condition precedent to such funding or payment has not been satisfied, or, in the case of clause (ii) or clause (iii) above, such Lender notifies the
Administrative Agent in writing that such failure is the result of a good faith dispute regarding its obligation to make such funding or payment; (b) has notified the
Borrower or any Agent Party in writing, or has made a public statement to the effect, that it does not intend to comply with any of its funding or payment obligations
under this Agreement (unless such writing or public statement indicates that such position is based on such Lender’s good faith determination that a condition
precedent to such funding or payment under this Agreement cannot be satisfied); (c) has failed, within three Business Days after request by the Administrative Agent
or Issuing Bank, acting in good faith, to provide a certification in writing from an authorized officer of such Lender that it will comply with its obligations under this
Agreement, provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon such Agent Party’s receipt of such certification; or (d)
has become the subject of a Bankruptcy Event.
“ Designated Noncash Consideration ” means the Fair Market Value of noncash consideration received by the Borrower or a Restricted Subsidiary in
connection with an Asset Sale that is so designated as Designated Non- cash Consideration pursuant to an Officer’s Certificate, setting forth the basis of such
valuation, less the amount of cash or Cash Equivalents received in connection with a subsequent sale of such Designated Noncash Consideration.
“ Designation ” has the meaning assigned to such term in the definition of “Unrestricted Subsidiary.”
“ Designation Amount ” has the meaning assigned to such term in the definition of “Unrestricted Subsidiary.
“ Disclosed Matters ” means the actions, suits and proceedings and the environmental matters disclosed in Schedule 3.06.
“ Disposition ” means, with respect to any property, any sale, lease, license, sale and leaseback, assignment, conveyance, transfer or other disposition
thereof. The terms “ Disp ose ” and “ Dispo sed of ” shall have correlative meanings.
“ Disqualified Equity Interests ” of any Person means any class of Equity Interests of such Person that, by its terms, or by the terms of any related
agreement or of any security into which it is convertible, puttable or exchange- able, is, or upon the happening of any event or the passage of time would be, required
to be redeemed by such Per- son, whether or not at the option of the holder thereof, or matures or is mandatorily redeemable, pursuant to a sinking fund obligation or
otherwise, in whole or in part, in each case on or prior to the date that is 91 days after the Revolving Termination Date; provided , however , that any class of Equity
Interests of such Person that, by its terms, authorizes such Person to satisfy in full its obligations with respect to the payment of dividends or upon maturity,
redemption (pursuant to a sinking fund or otherwise) or repurchase thereof or otherwise by the delivery of Equity Interests that are not Disqualified Equity Interests,
and that is not convertible, puttable or exchangeable for Disqualified Equity Interests or Indebtedness, will not be deemed to be Disqualified Equity Interests so long
as such Person satisfies its obligations with respect thereto solely by the delivery of Equity Interests that are not Disqualified Equity Interests; provide d, further ,
however , that any Equity Interests that would not constitute Disqualified Equity Interests but for provisions thereof giving holders thereof (or the holders of any
security into or for which such Equity Interests are convertible, exchangeable or exercisable) the right to require the Borrower to redeem such Equity Interests
13
upon the occurrence of a change of control occurring prior to the 91 st day after the Revolving Termination Date shall not constitute Disqualified Equity Interests if
such Equity Interests specifically provide that the Borrower will not redeem any such Equity Interests pursuant to such provisions prior to the Obligations (other than
(x) (i) Cash Management Obligations and (ii) Obligations under Specified Swap Agreements not yet due and payable, and
(y)
or having been terminated, and the Total Revolving Commitments having been terminated.
contingent obligations not yet accrued and payable) having been paid in full, all Letters of Credit having been cash collateralized or otherwise back-stopped
“ Dollar Amount ” means, at any date, (a) with respect to any amount denominated in Dollars, such amount and (b) with respect to any amount
denominated in amount other than Dollars, such amount converted to Dollars by the Administrative Agent at the Exchange Rate on such date.
“ Dollars ” or “ $ ” refers to lawful money of the United States of America.
“ Domestic Subsidiary ” means any Restricted Subsidiary of the Borrower that is not a Foreign Subsidiary.
"EMU ” means the economic and monetary union in accordance with the Treaty of Rome 1957, as amended by the Single European Act 1986, the
Maastricht Treaty of 1992 and the Amsterdam Treaty of 1998.
“ EMU Legislation ” means the legislative measures of the European Council for the introduction of, changeover to or operation of a single or unified
European currency.
“ Environmental Law ” means all laws, rules, regulations, codes, ordinances, orders, decrees, judgments, in- junctions, notices or binding agreements
issued, promulgated or entered into by any Governmental Authority, relat- ing in any way to the environment, preservation or reclamation of natural resources, the
management, release or threatened release of any Hazardous Material.
“ Environmental Liability ” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Borrower or any Restricted Subsidiary 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.
“ Equity Interests ” means, of any Person, (1) any and all shares or other equity interests (including common stock, preferred stock, limited liability
company interests and partnership interests) in such Person and (2) all rights to purchase, warrants or options (whether or not currently exercisable), participations or
other equivalents of or interests in (however designated) such shares or other interests in such Person, but excluding any debt securities convertible into such shares
or other interests.
“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time.
“ ERISA Affiliate ” means any trade or business (whether or not incorporated) that, together with the Bor- rower, is treated as a single employer under
Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of
the Code.
“ ERISA Event ” means (a) any “reportable event” (as defined in Section 4043(c) of ERISA or the regula- tions issued thereunder) with respect to a Plan
other than an event for which the 30-day notice period is waived; (b) any failure by any Plan to satisfy the minimum funding standards (within the meaning of
Sections 412 or 430 of the Code or Section 302 of ERISA) applicable to such Plan, whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or
Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the failure to make by its due date a required
installment under Section 430(j) of the Code with respect to any Plan or the failure by the Borrower or any of its ERISA Affiliates to make any required contribution
to a Multiemployer Plan; (e) the incurrence by the Borrower or any of its ERISA Affiliates of any liability un-
14
der Title IV of ERISA with respect to the termination of any Plan, including but not limited to the imposition of any Lien in favor of the PBGC or any Plan; (f) a
determination that any Plan is, or is expected to be, in “at risk” status (within the meaning of Section 430 of the Code or Title IV of ERISA); (g) the receipt by the
Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any notice relating to an intention to terminate any Plan or to appoint a trustee to
administer any Plan; (h) the incurrence by the Borrower or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any
Plan (or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA) or Multiemployer Plan; or (i) the receipt by the Borrower or
any ERISA Affiliate of any notice, or the receipt by any Multiemployer Plan from the Borrower or any ERISA Affiliate of any notice, concerning the imposition of
Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, Insolvent, in Reorganization or in endangered or critical status, within the
meaning of Section 432 of the Code or Section 305 of ERISA.
“Escrow Assumption Agreement” means an assumption agreement in form reasonably satisfactory to the Administrative Agent, among the Borrower and
the Administrative Agent.
“ Escrow Assumption ” means with respect to (i) any Escrow Permitted Ratio Debt, the assumption of the Escrow Borrower’s obligations with respect
thereto by the Borrower or (ii) any Incremental Term Loan that is ini- tially established as an Escrow Incremental Term Loan, the assumption of the Escrow
Borrower’s obligations with respect thereto by the Borrower pursuant to an Escrow Assumption Agreement.
“ Escrow Borrower ” means an Unrestricted Subsidiary established to borrow Escrow Permitted Ratio Debt or Escrow Incremental Term Loans (pending
assumption of such Escrow Permitted Ratio Debt or Escrow Incremental Term Loans by the Borrower) and that is not engaged in any material operations and does
not have any other material assets other than in connection therewith.
“ Escrow Incremental Term Loan ” means any Indebtedness that is initially borrowed by an Escrow Borrower that would constitute an Incremental Term
Loan if borrowed by the Borrower and that is not guaranteed by any other subsidiary of the Borrower and, if secured, is secured only by the proceeds of such Escrow
Incremental Term Loan, unless and until the Borrower has assumed all of the obligations of the Escrow Borrower with respect thereto.
“ Escrow Permitted Ratio Debt ” means any Indebtedness that is initially borrowed by an Escrow Borrower that would constitute Permitted Ratio Debt if
borrowed by the Borrower and that is not guaranteed by any other subsidiary of the Borrower and, if secured, is secured only by the proceeds of such Escrow
Permitted Ratio Debt, unless and until the Borrower has assumed all of the obligations of the Escrow Borrower with respect thereto.
“ Euro ” and “ EUR ” mean the lawful currency of the Participating Member States introduced in accordance with EMU Legislation.
“ Eurocurrency ” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing
interest at a rate determined by reference to the Eurocurrency Rate.
“ Eurocurrency Rate ” means, with respect to (A) any Eurocurrency Borrowing in any LIBOR Quoted Cur- rency and for any applicable Interest Period, the
LIBOR Screen Rate as of the Specified Time on the Quotation Day for such currency and Interest Period and (B) any Eurocurrency Borrowing in any Non-Quoted
Currency and for any applicable Interest Period, the applicable Local Screen Rate for such Non-Quoted Currency as of the Applicable Time and on the Quotation
Day for such currency and Interest Period; provided , that, if a LIBOR Screen Rate or a Local Screen Rate, as applicable, shall not be available at the applicable time
for the applicable Interest Period (an “ Impacted Interest Period ”), then the Eurocurrency Rate for such currency and Interest Period shall be the Interpolated Rate;
provided , further , that if the applicable Screen Rate shall not be available for such Interest Period and/or for the applicable currency with respect to such
Eurocurrency Borrowing for any reason and the Administrative Agent shall determine that it is not possible to determine the Interpolated Rate (which conclusion
shall be conclusive and binding absent manifest error), then the applicable Reference Bank Rate shall be the Eurocurrency Rate for such Interest Period for such
Eurocurrency Borrowing; subject to Section 2.11; provided that, (i) if any Eurocurrency Rate shall be less than zero, such rate shall be deemed to be zero for
purposes of this Agreement and (ii) solely with respect to the Term B-1 Loans, the Eurocurrency Rate shall not be less than 1.00%.
15
“ Event of Default ” has the meaning assigned to such term in Section 7.01.
“ Excess Cash Flow ” means, for any period, an amount equal to the excess of:
(a)
the sum, without duplication, of
(i) Consolidated Net Income for such period,
(ii)
amount equal to the amount of all non-cash charges to the extent deducted in arriving at such Consolidated Net Income and cash receipts
included in clauses (5), (7) and (8) of the definition of Consolidated Net Income and excluded in arriving at such Consolidated Net Income,
(iii)
decreases in Consolidated Working Capital for such period (other than any such decreases arising from dispositions outside the ordinary course
of business by the Borrower and its Restricted Subsidiaries completed during such period),
(iv)
cash receipts by the Borrower and its Restricted Subsidiaries in respect of Hedging Obliga- tions during such fiscal year to the extent not
otherwise included in such Consolidated Net Income; and
(v)
the amount by which tax expense deducted in determining such Consolidated Net Income for such period exceeded taxes (including penalties
and interest) paid in cash or tax reserves set aside or payable (without duplication) by the Borrower and its Restricted Subsidiaries in such period,
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 and cash charges included in clauses
(5), (7) and (8) of the definition of Consolidated Net In- come and included in arriving at such Consolidated Net Income,
(ii) without duplication of amounts deducted pursuant to clause (ix) below in prior years, the amount of Capital Expenditures or acquisitions of
Intellectual Property made in cash during such period by the Borrower and its Restricted Subsidiaries, except to the extent that such Capital Expenditures or
acquisi- tions were financed with the proceeds of Indebtedness of the Borrower or its Restricted Subsidiaries (other than under the Revolving Facility),
(iii)
the aggregate amount of all principal payments of Indebtedness of the Borrower and its Re- stricted Subsidiaries (including (A) the principal
component of payments in respect of Capital Lease Obli- gations and (B) the amount of any scheduled repayment of Term Loans, but excluding (x) all other pre-
payments of Term Loans, (y) all prepayments of Revolving Loans and (z) all prepayments in respect of any other revolving credit facility, except in the case of
clauses (y) and (z) to the extent there is an equivalent permanent reduction in commitments thereunder), except to the extent financed with the proceeds of other
Indebtedness (other than under the Revolving Facility) of the Borrower or its Restricted Subsidiaries,
(iv)
increases in Consolidated Working Capital for such period (other than any such increases aris- ing from acquisitions by the Borrower and its
Restricted Subsidiaries completed during such period or the application of purchase accounting),
(v)
payments by the Borrower and its Restricted Subsidiaries during such period in respect of long-term liabilities of the Borrower and the
Subsidiaries other than Indebtedness, to the extent not already deducted from Consolidated Net Income,
without duplication of amounts deducted pursuant to clause (ix) below in prior fiscal years, the aggregate amount of cash consideration paid by
the Borrower and the Subsidiaries (on a consolidated basis) in connection with Investments (including acquisitions) made during such period pursuant to Section
(vi)
16
6.11 (except for those Investments made under Section 6.11(b) and (d)) to the extent that such Investments were financed with internally generated cash
flow of the Borrower and its Restricted Subsidiaries,
(vii)
the amount of Restricted Payments during such period (on a consolidated basis) by the Bor-rower and its Restricted Subsidiaries made in
compliance with Section 6.05 (other than Section 6.05(iii), (iv), (vii), (xiii) and (xiv)) to the extent such Restricted Payments were financed with internally
generated cash flow of the Borrower and its Restricted Subsidiaries,
(viii)
the aggregate amount of any premium, make-whole or penalty payments actually paid in cash by the Borrower and its Restricted
Subsidiaries during such period that are made in connection with any prepayment of Indebtedness to the extent that such payments are not deducted in
calculating Consoli- dated Net Income,
(ix)
without duplication of amounts deducted from Excess Cash Flow in prior periods, the aggre- gate consideration required to be paid in
cash by the Borrower or any of its Restricted Subsidiaries pursuant to binding contracts (the “ Contract Consideration ”) entered into prior to or during such
period relating to Asset Acquisitions, Capital Expenditures or acquisitions of intellectual property to be consummated or made during the period of four
consecutive fiscal quarters of the Borrower following the end of such period, provided that to the extent the aggregate amount of internally generated cash
actually utilized to finance such Asset Acquisition, Capital Expenditures or acquisitions of intellectual property during such period of four consecutive
fiscal quarters is less than the Contract Consideration, the amount of such shortfall shall be added to the calculation of Excess Cash Flow at the end of such
period of four consecutive fiscal quarters,
(x)
the amount of taxes (including penalties and interest) paid in cash or tax reserves set aside or payable (without duplication) in such period
to the extent they exceed the amount of tax expense deducted in determining Consolidated Net Income for such period; and
(xi)
Net Income.
cash expenditures in respect of Hedging Obligations during such fiscal year to the extent not deducted in arriving at such Consolidated
“ Excess Cash Flow Period ” means each fiscal year of the Borrower, commencing with the fiscal year of the Borrower ending December 31, 2016;
provided that the first Excess Cash Flow Period hereunder shall begin on the first day of the first full fiscal quarter to occur on or after the earlier of (x) the date of
the Match Offering and (y) the date that is six months after the Term B-1 Effective Date.
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended.
“ Exchange Rate ” means, on any day, with respect to Dollars in relation to any Alternative Currency, the rate at which Dollars may be exchanged into such
Alternative Currency, as set forth at approximately 11:00 a.m., New York City time, on such day on the applicable Reuters World Spot Page. In the event that such
rate does not appear on the applicable Reuters World Spot Page, the Exchange Rate shall be determined by reference to such other publicly available service for
displaying exchange rates as may be agreed upon by the Administrative Agent and the Borrower or, in the absence of such agreement, the 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 11:00 a.m., London time, on such date for the purchase of such Alternative Currency with Dollars, for
delivery on such date, in the case where such Alternative Currency is Sterling, or two Business Days later, in the case of each other Alternative Currency; provided
that if at the time of any such determination, for any reason, no such spot rate is being reasonably quoted, the Administrative Agent, after consultation with the
Borrower, may use any reasonable method it deems appropriate to determine such rate, and such determination shall be conclusive absent manifest error.
“ Excluded Equity Interests ” means any Equity Interests (a) of any subsidiary (i) for which the pledge of its Equity Interests is prohibited by applicable law
or by Contractual Obligations existing on the Closing Date (or, in the case of a newly acquired subsidiary, in existence at the time of acquisition but not entered into
in contemplation
17
thereof) or for which governmental (including regulatory) consent, approval, license or authorization would be re- quired or (ii) that is not a Material Subsidiary or
(b) of any Foreign Subsidiary or FSHCO in excess of 65% of each class of outstanding Equity Interests of such Foreign Subsidiary or FSHCO.
“ Excluded Indebtedness ” means all Indebtedness not incurred in violation of Section 6.01.
“ Excluded Subsidiary ” means (a) any subsidiary that is not a Wholly Owned Subsidiary, (b) any subsidiary that is prohibited by applicable law or by
Contractual Obligations existing on the Closing Date (or, in the case of any newly acquired subsidiary, in existence at the time of acquisition but not entered into in
contemplation thereof) from guaranteeing the Obligations or if guaranteeing the Obligations would require governmental (including regulatory) consent, approval,
license or authorization, (c) any subsidiary that is not a Material Domestic Subsidiary, (d) any Unrestricted Subsidiary, (e) any FSHCO and (f) any Domestic
Subsidiary that is a direct or indirect subsidiary of a Foreign Subsidiary that is a CFC; provided that no subsidiary of the Borrower that Guarantees the IAC Credit
Agreement or the IAC Senior Notes shall be deemed to be an Excluded Subsidiary.
“ Excluded Swap Obligation ” means, with respect to any Guarantor, any Swap Obligation if, and to the ex- tent that, all or a portion of the Guarantee of
such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee 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 (a) such Guarantor’s failure for any reason to constitute an “eligible con- tract participant” as defined in the Commodity Exchange Act and the
regulations thereunder or (b) in the case of a Swap Obligation subject to a clearing requirement pursuant to Section 2(h) of the Commodity Exchange Act (or any
successor provision thereto), because such Guarantor is a “financial entity,” as defined in Section 2(h)(7)(C)(i) of the Commodity Exchange Act (or any successor
provision thereto), in each case at the time the Guarantee of such Guarantor or the grant of such security interest becomes effective with respect to such Swap
Obligation, unless otherwise agreed between the Administrative Agent and the Borrower. 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 Guarantee or security interest is or
becomes illegal.
“ Excluded Taxes ” means (a) in the case of each Lender and the Administrative Agent, taxes imposed on its overall net income, and franchise taxes
imposed on it in lieu of net income taxes by a jurisdiction (including any political subdivision thereof) as a result of (i) such Lender or the Administrative Agent’s
being organized under the laws of or having a principal office in such jurisdiction and, in the case of a Lender, having an applicable lending office in such
jurisdiction or (ii) a present or former connection between such Lender or the Administrative Agent and the jurisdiction (other than any connection arising solely
from such Lender or the Administrative Agent having executed, delivered, become a party to, performed its obligations under, received payments under, received or
per- fected a security interest under, engaged in any other transaction pursuant to and/or enforced any Loan Document);
(b)
withholding tax imposed pursuant to laws in effect on the date on which such Non-U.S. Lender becomes a Lender or (ii) such Non-U.S. Lender changes its lending
office, except in each case to the extent that, pursuant to Section 2.14, additional amounts with respect to such taxes were payable either to such Non-U.S. Lender’s
assignor immediately before such Non-U.S. Lender became a party hereto or to such Non-U.S. Lender immediately before it changed its lending office; (d) any
taxes attributable to such Lender’s failure to comply with Section 2.14(e) and (e) any United States federal withholding taxes imposed under FATCA.
any tax in the nature of branch profits taxes imposed by any jurisdiction described in clause (a); (c) in the case of a Non-U.S. Lender, United States federal
“ Extended Revolving Commitment ” shall have the meaning assigned to such term in Section 2.19(a).
“ Extended Revolving Loan ” shall have the meaning assigned to such term in Section 2.19(a).
“ Extended Term Loan ” shall have the meaning assigned to such term in Section 2.19(a).
“ Extending Lender ” shall have the meaning assigned to such term in Section 2.19(a).
“ Extension ” shall have the meaning assigned to such term in Section 2.19(a).
18
“ Extension Amendment ” shall have the meaning assigned to that term in Section 2.19(b).
“ Fair Market Value ” means, with respect to any asset, as determined by the Borrower, the price (after tak- ing into account any liabilities relating to such
assets) that would be negotiated in an arm’s-length transaction for cash between a willing seller and a willing and able buyer, neither of which is under any
compulsion to complete the transaction.
“ Facility ” means any of (a) the Revolving Facility and (b) the Term Facility.
“ FATCA ” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amend- ed or successor version that is substantively
comparable and not materially more onerous to comply with), any cur- rent or future regulations or official interpretations thereof and any agreements entered into
pursuant to Sec-
tion 1471(b)(1) of the current Code (or any amended or successor version described above) and any intergovern- mental agreements implementing the foregoing.
“ Federal Funds Effective Rate ” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of 1%) of the rates on
overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business
Day by the Federal Re- serve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (round- ed upwards, if necessary,
to the next 1/100 of 1%) charged to the Administrative Agent on such day on such transactions from three Federal funds brokers of recognized standing selected by
it.
“ Financial Officer ” means the chief financial officer, principal accounting officer, treasurer or controller of the Borrower.
“ Foreign Lender ” means any Lender that is not a “United States person” as defined in Section 7701(a)(30) of the Code.
“ Foreign Subsidiary ” means any Restricted Subsidiary of the Borrower that is organized under the laws of any jurisdiction other than the United States,
any State thereof or the District of Columbia.
“ FSHCO ” means any Domestic Subsidiary that owns no material assets other than Equity Interests of one or more Foreign Subsidiaries that are CFCs or
Equity Interests of one or more other FSHCOs.
“ GAAP ” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the
American Institute of Certified Public Accountants and statements and pro- nouncements of the Financial Accounting Standards Board or in such other statements
by such other entity as may be approved by a significant segment of the accounting profession of the United States, consistently applied.
“ Governmental Authority ” means the government of the United States of America, any other nation or any political subdivision thereof, whether state,
local, provincial or otherwise 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.
“ Guarantee ” of or by any Person (the “ guarantor ”) means a direct or indirect guarantee by any Person of any Indebtedness of any other Person and
includes any obligation, direct or indirect, contingent or otherwise, of such Person (1) to purchase or pay (or advance or supply funds for the purchase or payment of)
Indebtedness of such oth- er Person (whether arising by virtue of partnership arrangements, or by agreements to keep well, to purchase assets, goods, securities or
services (unless such purchase arrangements are on arm’s length terms and are entered into in the ordinary course of business), to take-or-pay, or to maintain
financial statement conditions or otherwise); or (2) entered into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment there-
of or to protect such obligee against loss in respect thereof (in whole or in part); “ Guarantee ,” when used as a verb, and “ Guaranteed ” have correlative meanings.
19
“ Guarantee Agreement ” means the Guarantee Agreement to be executed and delivered by each Subsidiary Guarantor, substantially in the form of Exhibit
C.
“g uarantor ” has the meaning assigned to such term in the definition of “Guarantee.”
“ Hazardous Materials ” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including
petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other
substances or wastes of any nature regulated pursuant to any Environmental Law.
“ Hedging Obligations ” of any Person means the obligations of such Person under swap, cap, collar, for- ward purchase or similar agreements or
arrangements dealing with interest rates, currency exchange rates or com- modity prices, either generally or under specific contingencies.
“ IAC ” means IAC/InterActiveCorp., a Delaware corporation.
“ IAC 2012 Senior Notes ” means the $500,000,000 aggregate principal amount of 4.75% senior notes due 2022 issued by IAC on December 21, 2012 and
any exchange notes related thereto.
“ IAC 2013 Senior Notes ” means the $500,000,000 aggregate principal amount of 4.875% senior notes due 2018 issued by IAC on November 15, 2013
and any exchange notes related thereto.
“ IAC Credit Agreement ” means the credit agreement dated as of December 21, 2012, as amended and re- stated on or about the Closing Date (as further
amended, restated, extended, supplemented or otherwise modified from time to time) among IAC, the lenders party thereto from time to time and JPMorgan Chase
Bank, N.A. as ad- ministrative agent and collateral agent.
“ IAC Facility Collateral Agent ” means JPMorgan Chase Bank, N.A., in its capacity as collateral agent for the secured parties under the IAC Credit
Agreement.
“ IAC Group ” means IAC and its subsidiaries not including the Match Group.
“ IAC Guarantor ” means any member of the IAC Group that is an obligor under the IAC Credit Agreement or the IAC Senior Notes.
“ IAC/Match Intercompany Debt ” means subject to compliance by IAC on a pro forma basis with Section 6.10 of the IAC Credit Agreement as in effect on
the Closing Date, the incurrence prior to the Match Offering, extension of existing or settlement of (x) unsecured intercompany loans, intercompany payables and
intercompany receivables between the Match Group and the IAC Group or (y) any intercompany contributions from the IAC Group to the Match Group (and, in
each case, payments or distributions thereon), in each case (i) under intercompany arrangements existing as of the Closing Date or put in place in connection with
the Match Offering or related transactions, in connection with the acquisition of Plentyoffish Media Inc. or (iii) in connection with cash management arrangements;
provided that, to the extent any IAC/Match Intercompany Debt remains outstanding or is incurred following the Separation Date, the Consolidated Net Leverage
Ratio (calculated on a pro forma basis) on the Separation Date (or if incurred after the Separation Date, the date of such incurrence) shall be equal to or less than
4.50 to 1.00.
“ IAC Senior Notes ” means the IAC 2012 Senior Notes and the IAC 2013 Senior Notes.
“ IAC Subordinated Debt Facility ” has the meaning assigned to such term in Section 6.01(z).
“ Impacted Interest Period ” has the meaning assigned to such term in the definition of “Eurocurrency Rate.”
20
“ Incremental Amount ” means, at any time, the greater of:
(a)
the excess (if any) of (i)$150,000,000 over
(ii) the aggregate amount of all Incremental Term Loan Commitments and Incre- mental Revolving Commitments, in each case,
established after the Closing Date and prior to such time and outstanding pursuant to Section 2.02; and
(b)
any amounts so long as immediately after giving pro forma effect to the establishment of the commitments in respect thereof, any
Asset Acquisition consummated concurrently therewith and the use of proceeds of the loans thereunder, both (x) the Secured Net Leverage Ratio is equal to
or less than (i) prior to the Term B-1 Loan Repayment Date, 2.25 to 1.00 (or, if such Incremental Facility is incurred in connection with the Match
Transactions, 4.00 to 1.00) and (ii) on or after the Term B-1 Loan Repayment Date, 3.50 to 1.00 and (y) the Consolidated Net Leverage Ratio is equal to or
less than 4.50 to 1.00, in each case, only on the date of the initial incurrence of (or commitment in respect of) the applicable Incremental Facility (except as
set forth in the final paragraph under Section 6.01) and calculated (x) as if any commit- ments in respect of Ratio Debt and Incremental Revolving
Commitments were fully drawn on the effective date thereof and (y) excluding any cash constituting proceeds of any such Incremental Facility or any sim-
ultaneous incurrence of Ratio Debt.
“ Incremental Assumption Agreement ” means an Incremental Assumption Agreement in form and sub- stance reasonably satisfactory to the Administrative
Agent, among the Borrower, the Administrative Agent and, if applicable, one or more Incremental Term Lenders and/or Incremental Revolving Lenders or, in the
case of any Es- crow Incremental Term Loans, the Escrow Assumption Agreement in respect thereof.
“ Incremental Assumption Agreement No. 1 ” means the Incremental Assumption Agreement and Amend- ment No. 1 dated as of the Term B-1 Effective
Date relating to the Term B-1 Loans.
“ Incremental Commitment ” means an Incremental Term Loan Commitment or an Incremental Revolving Commitment.
“ Incremental Facility ” means the Incremental Commitments and the Incremental Loans made thereunder.
“ Incremental Loan ” means an Incremental Term Loan or an Incremental Revolving Loan.
“ Incremental Revolving Commitment ” means the commitment of any Lender, established pursuant to Sec- tion 2.02, to make Incremental Revolving
Loans to the Borrower.
“ Incremental Revolving Lender ” means a Lender with an Incremental Revolving Commitment or an out- standing Incremental Revolving Loan.
“ Incremental Revolving Loan ” means Revolving Loans made by one or more Revolving Lenders to the Borrower pursuant to an Incremental Revolving
Commitment to make additional Revolving Loans.
“ Incremental Term A Facility ” means any Incremental Term Facility designated by the Borrower as an “In- cremental Term A Facility.”
“ Incremental Term A Loans ” means any term loans borrowed under an Incremental Term A Facility.
“ Incremental Term Facility ” means the Incremental Term Loan Commitments and the Incremental Term Loans made thereunder.
21
“ Incremental Term Lender ” means a Lender with an Incremental Term Loan Commitment or an outstand- ing Incremental Term Loan.
“ Incremental Term Loan Commitment ” means the commitment of any Lender, established pursuant to Sec- tion 2.02, to make Incremental Term Loans to
the Borrower. Any commitment of any lender established pursuant to Section 2.02(d) to make Escrow Incremental Term Loans to an Escrow Borrower shall not
constitute Incremental Term Loan Commitments unless and until the Borrower has assumed all of the obligations of the Escrow Borrower with respect thereto in
accordance with Section 2.02(d).
“ Incremental Term Loans ” means any term loans borrowed in connection with an Incremental Assumption Agreement. Any Escrow Incremental Term
Loans shall not constitute Incremental Term Loans unless and until the Borrower has assumed all of the obligations of the Escrow Borrower with respect thereto in
accordance with Section 2.02(d).
“ Indebtedness ” of any Person at any date means, without duplication:
(1)
(2)
(3)
transactions;
all liabilities, contingent or otherwise, of such Person for borrowed money;
all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;
all reimbursement obligations of such Person in respect of letters of credit, letters of guaranty, bankers’ acceptances and similar credit
(4)
all obligations of such Person to pay the deferred and unpaid purchase price of property or services, except (i) trade payables and
accrued expenses incurred by such Person in the ordinary course of business and (ii) amounts accrued associated with contingent consideration
arrangements;
(5)
(6)
all Capital Lease Obligations of such Person;
all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to
be secured by) a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person;
(7)
all Indebtedness of others Guaranteed by such Person to the extent of such Guarantee; provided that Indebtedness of the Borrower or
its subsidiaries that is Guaranteed by the Borrower or the Borrower’s subsidiaries shall only be counted once in the calculation of the amount of
Indebtedness of the Borrower and its subsidiaries on a consolidated basis; and
(8)
all obligations of such Person under conditional sale or other title retention agreements relating to assets purchased by such Person
(excluding obligations arising from inventory transactions in the ordinary course of business).
The amount of any Indebtedness which is incurred at a discount to the principal amount at maturity thereof as of any date shall be deemed to have been incurred at
the accreted value thereof as of such date. The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date of all unconditional
obligations as described above, the maximum liability of such Person for any such contingent obligations at such date and, in the case of clause (6), the lesser of (a)
the Fair Market Value of any asset subject to a Lien securing the Indebtedness of others on the date that the Lien attaches and (b) the amount of the Indebtedness
secured.
“ Indemnified Taxes ” means all Taxes other than Excluded Taxes.
“ Indemnitee ” has the meaning assigned to such term in Section 9.04(b).
“ Information ” has the meaning assigned to such term in Section 9.13.
22
“ Insolvent ” with respect to any Multiemployer Plan means the condition that such Multiemployer Plan is insolvent within the meaning of Section 4245 of
ERISA.
“ Intellectual Property ” means the collective reference to all rights, priorities and privileges relating to intel- lectual property, whether arising under United
States, multinational or foreign laws or otherwise, including copy- rights, patents, trademarks, service marks, trade dress, internet domain names, software, data,
databases, technology, know-how, trade secrets, processes and other confidential or proprietary information, together with all registrations and applications for
registration thereof, all licenses thereof or pertaining thereto, and all rights to sue at law or in equity for any infringement or other impairment thereof, including the
right to receive all proceeds and damages therefrom.
“ Interest Coverage Ratio ” means, as of any date of determination, the ratio of (a) Consolidated EBITDA of the Borrower and its Restricted Subsidiaries
for the Test Period most recently ended on or prior to such date of determination to (b) Consolidated Interest Expense for such Test Period.
(A)
The Interest Coverage Ratio shall be calculated for any period after giving effect on a pro forma basis (as if they had occurred on the first day
of the applicable Test Period) to:
(1)
the incurrence of any Indebtedness of the Borrower or any Restricted Subsidiary (and the application of the proceeds thereof) and any
repayment, repurchase, defeasance or other discharge of In- debtedness (and the application of the proceeds therefrom) (other than the incurrence or
repayment of In- debtedness in the ordinary course of business for working capital purposes pursuant to any revolving credit arrangement) occurring during
the applicable Test Period or (except when calculating the Interest Coverage Ratio for purposes of determining actual compliance (and not pro forma
compliance or compliance on a pro forma basis) with Section 6.10) at any time subsequent to the last day of such Test Period and on or prior to the date of
determination, as if such incurrence, repayment, issuance or redemption, as the case may be (and the application of the proceeds thereof), occurred on the
first day of the Test Period;
(2)
any (w) Asset Sale, (x) asset sale if the Fair Market Value of the assets sold in such trans- action or series of related transactions
exceeds $2,000,000 individually, which is solely excluded from the definition of Asset Sale pursuant to clause (7) of such definition, (y) Asset Acquisition
(including, without limitation, any Asset Acquisition giving rise to the need to make such calculation as a result of the Borrower or any Restricted
Subsidiary (including any Person who becomes a Restricted Subsidiary as a result of such Asset Acquisition or as a result of a Revocation) incurring
Acquired Indebtedness and also including any Consolidated EBITDA associated with any such Asset Acquisition) or (z) operational restructuring (each a “
pro forma e vent”) (including any cost savings and synergies resulting from head count reduction, closure of facilities and similar operational and other cost
savings and synergies relating to such pro forma event occurring within 12 months (or expected, in the good faith determination of the Borrower, to occur
within 12 months) of such pro forma event and during such period or (except when calculating the Interest Coverage Ratio for purposes of determining
actual compliance (and not pro forma compliance or compliance on a pro forma basis) with Section 6.10) subsequent to such period and on or prior to the
date of such calculation, in each case that are expected to have a continuing impact and are factually supportable, and which adjustments the Borrower
determines are reasonable as set forth in an Officer’s Certificate; provided that the aggregate amount of all such cost savings and synergies pursuant to this
clause (A)(2) and the second paragraph of the definition of “Consolidated EBITDA” shall in no event exceed 10 % of Consolidated EBITDA for such
period calculated prior to giving effect to such pro forma adjustments) occurring during the Test Period or at any time subsequent to the last day of the Test
Period and on or prior to the date of determination, as if such pro forma event occurred on the first day of the Test Period, and, provided , further , that asset
sales described in clause (A)(2)(x) in an aggregate amount not to exceed $50,000,000 in any Test Period shall not be required to be given pro forma effect;
and
(B)
forma effect:
in calculating Consolidated Interest Expense for purposes of the Interest Coverage Ratio with respect to any Indebtedness being given pro
23
(1) interest on outstanding Indebtedness determined on a fluctuating basis as of the date of determination and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such Indebtedness in effect on the date of
determination;
(2) if interest on any Indebtedness actually incurred on the date of determination may option- ally be determined at an interest rate based upon a
factor of a prime or similar rate, a eurocurrency inter- bank offered rate, or other rates, then the interest rate in effect on the date of determination will be
deemed to have been in effect during the Test Period;
(3) notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a fluctu- ating basis, to the extent such interest is covered by
agreements relating to Hedging Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of the agreements
gov- erning such Hedging Obligations;
(4) interest on any Indebtedness under a revolving credit facility shall be computed based upon the average daily balance of such Indebtedness
during the Test Period; and
(5) interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate rea- sonably determined by a responsible financial or
accounting Officer of the Borrower to be the rate of inter- est implicit in such Capital Lease Obligation in accordance with GAAP.
“ Interest Election Request ” means a request by the Borrower to convert or continue a Borrowing in accordance with Section 2.05.
“ Interest Payment Date ” means (a) with respect to any ABR Loan, the last day of each March, June, Sep- tember and December and (b) with respect to
any Eurocurrency Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurocurrency Borrowing
with an Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration
after the first day of such Interest Period.
“ Interest Period ” means, as to any Eurocurrency Loan, (a) initially, the period commencing on the borrow- ing or conversion date, as the case may be,
with respect to such Eurocurrency Loan and ending one week, one month, two months, three months or six months (or, if available to all Lenders under the
applicable Facility, twelve months) thereafter, as selected by the Borrower in its notice of borrowing or notice of conversion, as the case may be, given with respect
thereto, and (b) thereafter, each period commencing on the last day of the next preceding In- terest Period applicable to such Eurocurrency Loan and ending one
week, one month, two months, three months or six months (or, if agreed to by all Lenders under the applicable Facility, twelve months or such other, shorter period)
thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not later than 12:00 noon, New York City time (or in the case of an
Alternative Currency, 11:00 a.m., London time), on the date that is three Business Days prior to the last day of the then current Interest Period with respect thereto;
provided that all of the foregoing provisions relating to Interest Periods are subject to the following:
(i) if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next succeeding
Business Day unless the result of such extension would be to carry such Interest Period into another calendar month in which event such Interest Period
shall end on the immediately preceding Business Day;
(ii)
the Borrower may not select an Interest Period for a Revolving Loan that would extend beyond the Revolving Termination Date or an
Interest Period for a Term Loan that would extend beyond the date the final payment is due on such Term Loan; and
any Interest Period of at least one month’s duration that begins on the last Business Day of a calendar month (or on a day for which
there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar month.
(iii)
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“ Interpolated Rate ” means, at any time, for any Interest Period, the rate per annum (rounded to the same number of decimal places as the relevant Screen
Rates) determined by the Administrative Agent (which determina- tion shall be conclusive and binding absent manifest error) to be equal to the rate that results from
interpolating on a linear basis between: (a) the applicable Screen Rate (for the longest period for which the applicable Screen Rate is available for the applicable
currency) that is shorter than the Impacted Interest Period and (b) the applicable Screen Rate for the shortest period (for which such Screen Rate is available for the
applicable currency) that exceeds the Impacted Interest Period, in each case, as of the Specified Time on the Quotation Day for such Interest Period. When
determining the rate for a period which is less than the shortest period for which the relevant Screen Rate is available, the applicable Screen Rate for purposes of
paragraph (a) above shall be deemed to be the overnight screen rate where “overnight screen rate” means, in relation to any currency, the overnight rate for such
currency deter- mined by the Administrative Agent from such service as the Administrative Agent may select.
“ Investments ” has the meaning assigned to such term in Section 6.11.
“ ISP ” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law &
Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).
“ Issuing Bank ” means JPMorgan Chase Bank, N.A., Bank of America, N.A. and each other Issuing Bank designated pursuant to Section 2.17(j), each in
its capacity as an issuer of Letters of Credit, and its successors in such capacity as provided in Section 2.17(i). The Borrower may, with the consent of the
Administrative Agent (which consent shall not be unreasonably withheld), arrange for one or more Letters of Credit to be issued by other Lenders, in which case the
term “Issuing Bank” shall include such Lender with respect to the Letters of Credit is- sued by such Lender; provided that no such Lender shall have any obligation
to be an Issuing Bank unless it agrees to do so in its sole discretion.
“ Judgment Currency ” has the meaning assigned to such term in Section 9.14.
“ Junior Debt ” means Indebtedness for borrowed money that is (x) unsecured, or (y) by its terms subordi- nated or junior in right of payment or security to
the Obligations, in each case with an aggregate outstanding princi- pal amount in excess of $50,000,000.
“ Junior Debt Restricted Payment ” means, any payment or other distribution (whether in cash, securities or other property), directly or indirectly made by
the Borrower or any if its Restricted Subsidiaries, of or in respect of principal of or interest on any Junior Debt (or any Indebtedness incurred as Refinancing
Indebtedness in respect thereof); provide d, that the following shall not constitute a Junior Debt Restricted Payment:
(a)
(b)
refinancings with any Refinancing Indebtedness permitted to be incurred under Section 6.01;
payments of regularly-scheduled interest and fees due thereunder, other non-principal payments thereunder, any mandatory
prepayments of principal, interest and fees thereunder, scheduled payments thereon necessary to avoid the Junior Debt from constituting “applicable high
yield discount ob- ligations” within the meaning of Section 163(i)(l) of the Code, and principal on the scheduled maturity date of any Junior Debt;
(c)
payments or distributions in respect of all or any portion of the Junior Debt with the pro- ceeds from the issuance, sale or exchange by
the Borrower of Qualified Equity Interests within eighteen months prior thereto; or
(d)
the conversion of any Junior Debt to Qualified Equity Interests of the Borrower. “ Latest Maturity Date ” means, at any date of
determination, the latest of the latest Revolving Termination
Date and the latest maturity date in respect of any Class of Term Loans, in each case then in effect on such date of
determination.
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“ LC Disbursement ” means a payment made by the Issuing Bank pursuant to a demand for payment or drawing under a Letter of Credit.
“ LC Exposure ” means, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (b) the aggregate
amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The LC Exposure of any Lender at any time shall
be its Revolving Commitment Percentage of the total LC Exposure at such time. For purposes of computing the amount available to be drawn under any Letter of
Credit, the amount of such Letter of Credit shall be determined in accordance with Section 1.06. For all purposes of this Agreement, if on any date of determination
a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.14 of the ISP, such Let- ter of Credit
shall be deemed to be “outstanding” in the amount so remaining available to be drawn.
“ LC Participation Calculation Date ” means, with respect to any LC Disbursement made by the Issuing Bank or any refund of a reimbursement payment
made by the Issuing Bank to the Borrower, in each case in a cur- rency other than Dollars, (a) the date on which such Issuing Bank shall advise the Administrative
Agent that it pur- chased with Dollars the currency used to make such LC Disbursement or refund or (b) if such Issuing Bank shall not advise the Administrative
Agent that it made such a purchase, the date on which such LC Disbursement or refund is made.
“ Lead Arrangers ” means, collectively, J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith, Incorporated, Deutsche Bank Securities Inc.,
BNP Paribas Securities Corp. and Goldman Sachs Lending Partners LLC, as joint lead arrangers and joint bookrunners.
“ Lender Presentations ” means the (i) Lender Presentation made available to the Lenders in connection with the Lender meeting held on September 17,
2015 with respect to the Revolving Facility and this Agreement and (ii) Lender Presentation made available to the Lenders in connection with the Lender meeting
held on October 27, 2015 with respect to the Term B-1 Facility and this Agreement.
“ Lenders ” means the Persons listed on Schedule 1.01A and any other Person that shall have become a party hereto pursuant to an Assignment and
Assumption or any Incremental Assumption Agreement, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Assumption.
“ Letter of Credit ” means any letter of credit issued pursuant to Section 2.17.
“ LIBOR Quoted Currency ” means Dollars, Euros, Sterling and Yen.
“ LIBOR Screen Rate ” means the London interbank offered rate administered by the ICE Benchmark Association (or any other Person that takes over the
administration of such rate) for such LIBOR Quoted Currency for a period equal in length to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of
the Reuters screen or, in the event such rate does not appear on either of such Reuters pages, on any successor or substitute page on such screen that displays such
rate, or on the appropriate page of such other information service that publishes such rate as shall be selected by the Administrative Agent from time to time in its
reasonable discretion.
“ Lien ” means, with respect to any asset, any mortgage, deed of trust, lien (statutory or other), pledge, easement, charge, security interest or other
encumbrance of any kind or nature in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including the interest of a
vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic
effect as any of the foregoing) relating to such asset. “Lien” shall not, however, include any interest of a vendor in any inventory of the Borrower or any of its
Restricted Subsidiaries arising out of such inventory being subject to a “sale or return” arrangement with such vendor or any consignment by any third party of any
inventory to the Borrower or any of its Restricted Subsidiaries.
“ Limited Condition Acquisition ” means any acquisition, including by means of a merger, amalgamation or consolidation, by the Borrower or one or more
of its Restricted Subsidiaries, the consummation of which is not con- ditioned upon the availability of, or on obtaining, third party financing or in connection with
which any fee or ex-
26
pense would be payable by the Borrower or its Restricted Subsidiaries to the seller or target in the event financing to consummate the acquisition is not obtained as
contemplated by the definitive acquisition agreement.
“ Loan Documents ” means the collective reference to this Agreement, the Guarantee Agreement, the Collateral Documents, any Incremental Assumption
Agreement, the Letters of Credit and any amendments or waivers to any of the foregoing.
“ Loan Parties ” means the collective reference to the Borrower and the Subsidiary Guarantors.
“ Loans ” means the loans made by the Lenders to the Borrower pursuant to this Agreement.
“ Local Screen Rates ” means the Australian Dollar Screen Rate and the CDOR Screen Rate; provided , that, if any Local Screen Rate shall be less than
zero, such rate shall be deemed to be zero for purposes of this Agree- ment.
“ Match Group ” means the Borrower and its subsidiaries.
“ Match Offering ” means the issuance by the Borrower of up to an aggregate of 20% of the economic inter- est represented by all outstanding capital stock
of the Borrower as of the date of the Match Offering (after giving pro forma effect to the issuance of such capital stock in such offering) in an initial underwritten
public offering pursuant to an effective registration statement filed with the SEC pursuant to the Securities Act.
“ Match Transaction Distributions ” means dividends or distributions of cash and other property from the Match Group to the IAC Group (i) of a
combination of cash and/or Pre-IPO Notes which, in the aggregate, do not exceed the net cash proceeds of the Match Offering, (ii) of a combination of the net cash
proceeds of certain Indebtedness incurred by the Match Group on or prior to the date of the Match Offering and/or debt securities issued by Match or IAC (including
the Senior Notes) which, in the aggregate, do not exceed $1,500,000,000, in each case, designated by the Borrower as incurred in connection with the Match
Offering, (iii) of any cash on the balance sheet of the Match Group on the Closing Date and any cash flow of the Match Group accruing from and after the Closing
Date until the date of the Match Offering and (iv) without duplication, in an amount equal to any proceeds from cash common equity contributions received by the
Match Group after the Closing Date and prior to the date of the Match Offering, in each case so long as, on a pro forma basis after giving effect thereto and to the
other transactions consummated in connection therewith, (x) the Borrower is in compliance with Section 6.10, (y) no Default or Event of Default shall have occurred
and be continuing and (z) in the case of any dividend or distribution under clause (iii) above occurring on or after the Separation Date, on the date of such
distribution, (A) the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00 and (B) no Loans are outstanding under the Revolving Facility.
“ Match Transactions ” means, the Match Offering, and in connection therewith, the entry into a number of related transactions and agreements with the
IAC Group, including, but not limited to:
(a)
entry into and consummation of the transactions contemplated under a master transaction agreement, an investor rights agreement, a
services agreement, a tax sharing agreement, an employee matters agreement and similar agreements and arrangements and the transactions in connection
therewith;
(b)
(c)
(d)
the IAC/Match Intercompany Debt;
the Match Transaction Distributions;
the entry into this Agreement and any Incremental Assumption Agreements and perfor- mance of the obligations hereunder and
thereunder and any related agreements, including any guarantee agreements or pledge agreements; and
(e)
the creation of, and payments under, the IAC Subordinated Debt Facility.
27
“ Material Adverse Effect ” means a material adverse effect on (a) the business, operations, property or con- dition, financial or otherwise, of the Borrower
and its Restricted Subsidiaries taken as a whole that results in a mate- rial impairment of the ability of the Borrower to perform any payment obligations hereunder
or (b) the validity or enforceability of this Agreement or the other Loan Documents or the rights or remedies of the Administrative Agent (including in its capacity as
Collateral Agent) or the Lenders hereunder or thereunder.
“ Material Domestic Subsidiary ” means any Wholly Owned Subsidiary that is a Domestic Subsidiary of the Borrower, as of the last day of the fiscal
quarter of the Borrower most recently ended for which financial statements have been or are required to have been delivered, that has assets or revenues (including
third party revenues but not including intercompany revenues) with a value in excess of 2.50% of the consolidated assets of the Borrower and its Wholly Owned
Subsidiaries that are Domestic Subsidiaries or 2.50% of the consolidated revenues of the Borrower and its Wholly Owned Subsidiaries that are Domestic
Subsidiaries; provided that in the event Wholly Owned Subsidiaries that are Domestic Subsidiaries that would otherwise not be Material Domestic Subsidiaries shall
in the aggregate account for a percentage in excess of 7.50% of the consolidated assets of the Borrower and its Wholly Owned Subsidiaries that are Domestic
Subsidiaries or 7.50% of the consolidated revenues of the Borrower and its Wholly Owned Subsidiaries that are Domestic Subsidiaries as of the end of and for the
most recently completed fiscal quarter, then one or more of such Domestic Subsidiaries designated by the Borrower (or, if the Borrower shall make no designation,
one or more of such Domestic Subsidiaries in descending order based on their respective contributions to the consolidated assets of the Borrower), shall be included
as Material Domestic Subsidiaries to the extent necessary to eliminate such excess.
“ Material Indebtedness ” means Indebtedness (other than the Loans), or obligations in respect of a Swap Agreement, of any one or more of the Borrower
and its Restricted Subsidiaries in an aggregate principal amount exceeding $50,000,000. For purposes of determining Material Indebtedness, the “principal amount”
of the obliga- tions of the Borrower or any Restricted Subsidiary in respect of any Swap Agreement at any time shall be the maxi- mum aggregate amount (giving
effect to any netting agreements) that the Borrower or such Restricted Subsidiary would be required to pay if such Swap Agreement were terminated at such time.
“ Material Subsidiary ” means any Restricted Subsidiary of the Borrower, as of the last day of the fiscal quarter of the Borrower most recently ended for
which financial statements have been, or were required to be, delivered pursuant to Section 5.01, that has assets or revenues (including third party revenues but not
including intercompany revenues) with a value in excess of 1.0% of the consolidated assets of the Borrower or 1.0% of the consolidated revenues of the Borrower;
provided that in the event Restricted Subsidiaries that would otherwise not be Material Subsidiaries shall in the aggregate account for a percentage in excess of 7.5%
of the consolidated assets of the Borrower or 7.5% of the consolidated revenues of the Borrower as of the end of and for the most recently completed fiscal quarter
for which financial statements have been, or were required to be, delivered pursuant to Section 5.01, then one or more of such Restricted Subsidiaries designated by
the Borrower (or, if the Borrower shall make no designation, one or more of such Restricted Subsidiaries in descending order based on their respective contributions
to the consolidated assets of the Borrower), shall be included as Material Subsidiaries to the extent necessary to eliminate such excess.
“ Moody’s ” means Moody’s Investors Service, Inc.
“ Multiemployer Plan ” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
“ Net Proceeds ” means:
(a)
100% of the cash proceeds actually received by the Borrower or any Subsidiary (including any cash payments received by way of deferred
payment of principal pursuant to a note or installment receivable or pur- chase price adjustment receivable or otherwise, but only as and when received) from any
Asset Sale, net of
(i) attorneys’ fees, accountants’ fees, investment banking fees, survey costs, title insurance premiums, and related search and recording charges, transfer Taxes, deed
or mortgage recording Taxes, other customary expenses and bro- kerage, consultant and other customary fees actually incurred in connection therewith, (ii) required
payments of In- debtedness (other than Indebtedness incurred under the Loan Documents or Other First Lien Debt) and required payments of other obligations
relating to the applicable asset to the extent such Indebtedness or other obligations are
28
secured by a Lien permitted hereunder (other than pursuant to the Loan Documents, Other First Lien Debt or obliga tions secured by a Lien that is junior to the Liens
securing the Obligations), (iii) repayments of Other First Lien Debt (limited to its proportionate share of such prepayment, based on the amount of such then
outstanding debt as a percentage of all then outstanding Indebtedness incurred under the Loan Documents and Other First Lien Debt),
(iv) Taxes paid or payable (in the good faith determination of the Borrower) as a direct result thereof, and (v) the amount of any reasonable reserve established in
accordance with GAAP against any adjustment to the sale price or any liabilities (other than any Taxes deducted pursuant to clause (i) or (iv) above) (x) related to
any of the applicable assets and (y) retained by the Borrower or any of the Subsidiaries including, without limitation, pension and other post-employment benefit
liabilities and liabilities related to environmental matters or against any indemnification obligations ( provided that (1) the amount of any reduction of such reserve
(other than in connection with a payment in respect of any such liability), prior to the date occurring 18 months after the date of the respective Asset Sale, shall be
deemed to be cash proceeds of such Asset Sale occurring on the date of such reduction and (2) the amount of any such reserve that is maintained as of the date
occurring 18 months after the date of the applicable Asset Sale shall be deemed to be Net Proceeds from such Asset Sale as of such date); provided , that, if the
Borrower shall de- liver an Officer’s Certificate to the Administrative Agent promptly following receipt of any such proceeds setting forth the Borrower’s intention
to use any portion of such proceeds, within 12 months of such receipt, to acquire, maintain, develop, construct, improve, upgrade or repair assets useful in the
business of the Borrower and the Sub- sidiaries or to make Asset Acquisitions and other Investments permitted hereunder (excluding Cash Equivalents or
intercompany Investments in Subsidiaries) or to reimburse the cost of any of the foregoing incurred on or after the date on which the Asset Sale giving rise to such
proceeds was contractually committed (other than inventory), such portion of such proceeds shall not constitute Net Proceeds except to the extent not, within 365
days of such receipt, so used or contractually committed to be so used (it being understood that if any portion of such proceeds are not so used within such 365 day
period but within such 365 day period are contractually committed to be used, then such remaining portion if not so used within 180 days following the end of such
365 day period shall constitute Net Pro- ceeds as of such date without giving effect to this proviso); provided , further, that no net cash proceeds calculated in
accordance with the foregoing realized in a single transaction or series of related transactions shall constitute Net Proceeds unless such net cash proceeds shall
exceed (x) prior to the Term B-1 Loan Repayment Date, $50,000,000 and (y) on or after the Term B-1 Loan Repayment Date, $150,000,000 (and in each case
thereafter only net cash proceeds in excess of such amount shall constitute Net Proceeds);
(b)
100% of the cash proceeds actually received by the Borrower or any Subsidiary (including casualty insurance settlements and condemnation
awards, but only as and when received) from any Recovery Event, net of attorneys’ fees, accountants’ fees, transfer Taxes, deed or mortgage recording Taxes on
such asset, other customary expenses and brokerage, consultant and other customary fees actually incurred in connection therewith, (ii) re- quired payments of
Indebtedness (other than Indebtedness incurred under the Loan Documents or Other First Lien Debt) and required payments of other obligations relating to the
applicable asset to the extent such Indebtedness or other obligations are secured by a Lien permitted hereunder (other than pursuant to the Loan Documents, Other
First Lien Debt or obligations secured by a Lien that is junior to the Liens securing the Obligations), (iii) repayments of Other First Lien Debt (limited to its
proportionate share of such prepayment, based on the amount of such then out- standing debt as a percentage of all then outstanding Indebtedness incurred under the
Loan Documents and Other First Lien Debt, and (iv) Taxes paid or payable (in the good faith determination of the Borrower) as a direct result thereof; provided ,
that, if the Borrower shall deliver an Officer’s Certificate to the Administrative Agent promptly following receipt of any such proceeds setting forth the Borrower’s
intention to use any portion of such proceeds, within 365 days of such receipt, to acquire, maintain, develop, construct, improve, upgrade or repair assets useful in
the business of the Borrower and the Subsidiaries or to make Asset Acquisitions and other Investments permitted hereunder (excluding Cash Equivalents or
intercompany Investments in Subsidiaries) or to reimburse the cost of any of the foregoing incurred on or after the date on which the Recovery Event giving rise to
such proceeds was contrac- tually committed (other than inventory, except to the extent the proceeds of such Recovery Event are received in respect of inventory),
such portion of such proceeds shall not constitute Net Proceeds except to the extent not, within 365 days of such receipt, so used or contractually committed to be so
used (it being understood that if any portion of such proceeds are not so used within such 365 day period but within such 365 day period are contractually commit-
ted to be used, then such remaining portion if not so used within 180 days following the end of such 365 day period shall constitute Net Proceeds as of such date
without giving effect to this proviso); provided , further , that no net cash proceeds calculated in accordance with the foregoing realized in a single transaction or
series of related transactions shall constitute Net Proceeds unless such net cash proceeds shall exceed (x) prior to the Term B-1 Loan Repayment
29
Date, $50,000,000 and (y) on or after the Term B-1 Loan Repayment Date, $150,000,000 (and in each case thereaf- ter only net cash proceeds in excess of such
amount shall constitute Net Proceeds); and
(c)
100% of the cash proceeds from the incurrence, issuance or sale by the Borrower or any Subsidi- ary of any Indebtedness (other than Excluded
Indebtedness, except for Refinancing Term Loans), net of all fees (in- cluding investment banking fees), commissions, costs and other expenses, in each case
incurred in connection with such issuance or sale.
“ Non-Consenting Lender ” has the meaning assigned to such term in Section 2.16(c).
“ Non-Defaulting Lender ” means, at any time, each Lender that is not a Defaulting Lender at such time.
“ Non-Defaulting Revolving Lender ” means, at any time, each Revolving Lender that is not a Defaulting Lender at such time.
“ Non-Loan Party ” means any Restricted Subsidiary other than a Loan Party.
“ Non-Quoted Currency ” means each of Australian Dollars and Canadian Dollars .
“ Non-U.S. Lender ” means any Lender that is not a U.S. Lender.
“Obligations” means the unpaid principal of and interest on (including interest, fees and expenses accruing after the maturity of the Loans and interest, fees
and expenses accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the
Borrower, whether or not a claim for post-filing or post-petition interest, fees and expenses is allowed in such proceeding) the Loans, the obligations of the Loan
Parties to reimburse the Issuing Bank for demands for payment or drawings under a Letter of Credit, and all other obligations and liabilities of the Borrower to the
Administrative Agent or to any Secured Party, whether direct or indirect, absolute or contingent, due or to become due, or now existing or hereafter incurred, which
may arise under, out of, or in connection with, this Agreement, any other Loan Document, any Specified Swap Agreement, any Cash Management Agreement or any
other document made, delivered or given in connection here- with or therewith, whether on account of principal, interest, fees, indemnities, costs, expenses or
otherwise (including all fees, charges and disbursements of counsel to the Administrative Agent, the Lead Arrangers or to any Lender that are required to be paid by
the Borrower pursuant hereto). Notwithstanding the foregoing, the Obligations shall not include any Excluded Swap Obligations.
“ OFAC ” means the U.S. Department of the Treasury’s Office of Foreign Assets Control.
“ Officer’s Certificate ” means a certificate of a Financial Officer in form and substance reasonably accepta- ble to the Administrative Agent.
“ Other First Lien Debt ” means obligations secured by Liens on the Collateral that are equal and ratable with the Liens thereon securing the Term B-1
Loans pursuant to an intercreditor agreement reasonably satisfactory to the Administrative Agent.
“ Other Taxes ” means all present or future stamp or documentary Taxes or any other excise or property Taxes, charges or similar levies arising from any
payment made under any Loan Document or from the execution, delivery or enforcement or registration of, from the receipt or perfection of a security interest
under, or otherwise with respect to, any Loan Document.
“ Outstanding Revolving Credit ” means, with respect to any Revolving Lender at any time, an amount equal to the sum of (a) the aggregate then
outstanding principal amount of such Revolving Lender’s Revolving Loans and such Revolving Lender’s LC Exposure.
“ parent ” has the meaning assigned to such term in the definition of “subsidiary.”
30
“ Parent Company ” has the meaning assigned to such term in the definition of “Bankruptcy Event.”
“ Participant ” has the meaning assigned to such term in Section 9.05(c).
“ Participant Register ” has the meaning assigned to such term in Section 9.05(c).
“ Participating Member State ” means any member state of the EMU which has the Euro as its lawful currency.
“ PBGC ” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any suc- cessor entity performing similar functions.
“ Perfection Certificate ” means a certificate in the form of Exhibit H or any other form approved by the Administrative Agent (acting reasonably), as the
same shall be supplemented from time to time by any supplement thereto or otherwise.
“ Permitted Encumbrances ” means:
(a)
Section 5.04;
Liens imposed by law for taxes, assessments or governmental charges that are not yet due or are being contested in compliance with
(b)
landlord’s, carriers’, warehousemen’s, mechanics’, supplier’s, materialmen’s, repair- men’s and other like Liens imposed by law,
arising in the ordinary course of business and securing obligations that are not overdue by more than 30 days or are being contested in compliance with
Section 5.04;
(c)
pledges and deposits made in the ordinary course of business in compliance with workers’ compensation (or pursuant to letters of
credit issued in connection with such workers’ compensation compliance), unemployment insurance and other social security laws or regulations;
(d)
deposits to secure the performance of tenders, bids, trade contracts, leases, statutory obli- gations, surety and appeal bonds,
performance bonds, leases, subleases, government contracts and return- of-money bonds, letters of credit and other obligations of a like nature, in each case
in the ordinary course of business (exclusive of the obligation for the payment of borrowed money);
(e)
judgment liens in respect of judgments that do not constitute an Event of Default under Section 7.01(j);
(f)
easements, zoning restrictions, rights-of-way, survey exception, minor encumbrances, reservation of, licenses, electric lines, telegraph
and telephone lines and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary
obligations and do not materially detract from the value of the affected property or interfere with the ordinary conduct of business of the Borrower or any
Restricted Subsidiary;
(g)
Liens securing obligations in respect of trade-related letters of credit and covering the goods (or the documents of title in respect of
such goods) financed or the purchase of which is supported by such letters of credit and the proceeds and products thereof;
(h)
Liens upon specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of
bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods; and
(i)
Liens securing obligations in respect of letters of credit, bank guarantees, warehouse re- ceipts or similar instruments issued to support
performance obligations (other than Obligations in respect of Indebtedness) and trade-related letters of credit, in each case, outstanding on the Closing Date
or issued
31
thereafter in and covering the goods (or the documents of title in respect of such goods) financed by such letters of credit, banker’s acceptances or bank
guarantees and the proceeds and products thereof.
“ Permitted Holders ” means any one or more of (a) IAC and its wholly owned subsidiaries, (b) Barry Diller,
each of the respective Affiliated Persons of the Person referred to in clause (b) and (d) any Person a majority of the aggregate voting power of all the
(c)
outstanding classes or series of the equity securities of which are beneficially owned by any one or more of the Persons referred to in clauses (a), (b) or (c).
“ Permitted Liens ” means Liens permitted by Section 6.02.
“ Permitted Mandatory Prepayments ” means with respect to any Indebtedness, any requirement to prepay such Indebtedness (i) in connection with any
asset sale or event of loss (with associated reinvestment rights), (ii) in respect of Refinancing Indebtedness, (iii) in respect of Indebtedness not permitted to be
incurred by the terms of such Indebtedness, (iv) in connection with any cash sweep provisions customary in the determination of the Borrower for term loan B
facilities or (v) in connection with any change of control.
“ Permitted Ratio Debt ” means Permitted Secured Ratio Debt and Permitted Unsecured Ratio Debt.
“ Permitted Secured Ratio Debt ” means Indebtedness of the Borrower so long as, (I) on a pro forma basis after giving effect thereto and the use of
proceeds thereof (calculated (x) as if any outstanding commitments for all such Indebtedness, Permitted Unsecured Ratio Debt and Incremental Commitments were
fully drawn on the effec- tive date thereof and (y) excluding any cash constituting proceeds of any such Indebtedness or any simultaneous incurrence of Permitted
Unsecured Ratio Debt and/or Incremental Facilities), the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00 and the Secured Net Leverage Ratio is
equal to or less than (x) prior to the Term B-1 Loan Repayment Date, 2.25 to 1.00 (or, if such Permitted Secured Ratio Debt is incurred in connection with the Match
Transactions, 4.00 to 1.00) and (y) on or after the Term B-1 Loan Repayment Date, 3.50 to 1.00, in each case, only on the date of the initial incurrence of (or
commitment in respect of) such Indebtedness, (II) no Default shall have occurred and be continuing after giving effect thereto, (III) the Borrower shall be in
compliance with Section
6.10 as of the last day of the most recent Test Period on a pro forma basis after giving effect to the incurrence of any such Indebtedness and the use of proceeds
thereof, (IV) the maturity date of such Indebtedness shall be no earlier than 90 days following the Latest Maturity Date then in effect and such Indebtedness shall not
require any mandato- ry prepayments other than Permitted Mandatory Prepayments, (V) such Indebtedness (w) shall not require scheduled amortization payments
(excluding the final installment thereof) in excess of 1.00% per annum of the original aggre- gate principal amount thereof, (x) shall not have a Weighted Average
Life to Maturity that is shorter than the then longest remaining Weighted Average Life to Maturity of any then outstanding Term Loans, (y) shall have no finan- cial
maintenance covenants of a different type than those set forth in Section 6.10, and no financial maintenance covenants that are more restrictive than those set forth in
Section 6.10, and (z) does not have negative covenants and/or default provisions that, taken as a whole, are materially more restrictive than those applicable to this
Agree- ment as determined in good faith by the Borrower unless, in each case of clauses (y) and (z) such terms become ap- plicable only after the Revolving Facility
shall have matured or been terminated and any Term Loans existing at such date have been paid in full, (VI) such Indebtedness is not guaranteed by any subsidiaries
of the Borrower that do not guarantee the Obligations and is secured on an equal and ratable or junior lien basis by the same Collateral (and no additional Collateral)
securing the Obligations pursuant to an intercreditor agreement reasonably satisfactory to the Administrative Agent and (VII) if such Indebtedness is in the form of
term loans, such Indebtedness shall be subject to the “most-favored nations” provision of Section 2.02(b)(v) as if such Indebtedness was incurred as an Incremental
Term Loan under this Agreement (and with pricing increases with respect to the Term B-1 Loans to occur as, and to the extent provided in the “most favored
nations” provision of Section 2.02(b)(v) as if such Indebt- edness was incurred as an Incremental Term Loan hereunder); provided that the Escrow Assumption with
respect to any Escrow Permitted Ratio Debt shall not be permitted unless on the date thereof (after giving effect thereto) the conditions set forth above would be
satisfied if the Borrower was borrowing such Permitted Ratio Debt on the date of such Escrow Assumption; provided further any Escrow Permitted Ratio Debt shall
not constitute Permitted Unse- cured Ratio Debt unless the Escrow Assumption with respect thereto shall have occurred.
“ Permitted Unsecured Ratio Debt ” means unsecured Indebtedness of the Borrower so long as, (I) on a pro forma basis after giving effect thereto and the
use of proceeds thereof (calculated (x) as if any outstanding commit-
32
ments for all such Indebtedness, Permitted Secured Ratio Debt and Incremental Commitments were fully drawn on the effective date thereof and (y) excluding any
cash constituting proceeds of such Indebtedness or any simultaneous incurrence of Permitted Secured Ratio Debt and/or Incremental Facilities), the Consolidated
Net Leverage Ratio is equal to or less than 4.50 to 1.00 only on the date of the initial incurrence of (or commitment in respect of) such Indebtedness, (II) no Default
shall have occurred and be continuing after giving effect thereto, (III) the Borrower shall be in compliance with Section 6.10 on a pro forma basis as of the last day
of the most recently completed Test Period after giving effect to the incurrence of any such Indebtedness and the use of proceeds thereof, (IV) other than with
respect to either Indebtedness the aggregate principal amount of which does not exceed $50,000,000 or Indebtedness issued in exchange for the IAC 2012 Senior
Notes in connection with the Match Transactions, the maturity date of such Indebtedness shall be no earlier than 90 days following the Latest Maturity Date then in
effect and such Indebtedness shall not require any mandatory prepayments other than Permitted Mandatory Prepayments, (V) such Indebtedness (w) shall not require
scheduled amortization payments (excluding the final installment thereof) in excess of 1.00% per annum of the original aggregate principal amount thereof, (x) shall
not have a Weighted Average Life to Maturity that is shorter than the then longest remaining Weighted Average Life to Maturity of any then out- standing Term
Loans, (y) shall have no financial maintenance covenants of a different type than those set forth in Section 6.10, and no financial maintenance covenants that are
more restrictive than those set forth in Section 6.10, and (z) does not have negative covenants and/or default provisions that, taken as a whole, are materially more
restrictive than those applicable to this Agreement as determined in good faith by the Borrower unless, in each case of clauses (y) and (z) such terms become
applicable only after the Revolving Facility shall have matured or been terminated and any Term Loans existing at such date have been paid in full and (VI) such
Indebtedness shall not be guaranteed by any subsidiaries of the Borrower other than Guarantees by the Guarantors that by their terms are subordinated in right of
payment to the Obligations; provided that the Escrow Assumption with respect to any Escrow Permitted Ratio Debt shall not be permitted unless on the date thereof
(after giving effect thereto) the conditions set forth above would be satisfied if the Borrower was borrowing such Permitted Ratio Debt on the date of such Escrow
Assumption; provided further , any Escrow Permitted Ratio Debt shall not constitute Permitted Unsecured Ratio Debt until the Escrow Assumption with respect
thereto shall have occurred.
“ person ” and “ group ” have the meanings given to them for purposes of Section 13(d) and 14(d) of the Ex- change Act or any successor provisions, and
the term “group” includes any group acting for the purpose of acquir- ing, holding or disposing of securities within the meaning of rule 13d-5(b)(1) under the
Exchange Act, or any suc- cessor provision.
“ Person ” means any individual, corporation, partnership, limited liability company, joint venture, incorpo- rated or unincorporated association, joint-stock
company, trust, unincorporated organization or government or other agency or political subdivision thereof or other entity of any kind.
“ Plan ” means an employee pension benefit plan as defined in Section 3(2) of ERISA (other than a Mul- tiemployer Plan), subject to the provisions of
Section 302 and Title IV of ERISA or Section 412 of the Code, and in respect of which the Borrower or any ERISA Affiliate is (or if such plan were terminated,
would under Section 4062 or 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
“ Platform ” has the meaning assigned to such term in Section 9.18.
“ Pledge Agreement ” means the Pledge Agreement by the Borrower and the Subsidiary Guarantors, sub- stantially in the form of Exhibit D .
“ Pre-IPO Note ” means any intercompany debt (i) owed by the Borrower to any member of the IAC Group,
incurred within 30 days prior to the Match Offering, (iii) having a maturity not in excess of 30 days, (iv) that by its terms is subordinated in right of payment
(ii)
to the obligations under the Senior Secured Credit Facilities, and (v) that is designated as such by the Borrower.
“ Preferred Stock ” means, with respect to any Person, any and all preferred or preference stock or other eq- uity interests (however designated) of such
Person whether now outstanding or issued after the Closing Date.
“ Pricing G rid” means the table below:
33
Consolidated Net Leverage Ratio
Commitment Fee Rate
Applicable Rate for Eurocurrency
Loans
Applicable Rate for ABR Loans
>4.00:1.00
< 4.00:1.00 but >3.00:1.00
< 3.00:1.00 but >2.00:1.00
< 2.00:1.00
0.40%
0.35%
0.30%
0.25%
2.25%
2.00%
1.75%
1.50%
1.25%
1.00%
0.75%
0.50%
For the purposes of the Pricing Grid, changes in the Applicable Rate and Commitment Fee Rate resulting from changes in the Consolidated Net Leverage Ratio shall
become effective on the date (the “ Ad justment D ate”) on which financial statements are delivered to the Lenders pursuant to Section 5.01 and shall remain in
effect until the next change to be effected pursuant to this paragraph. Notwithstanding the foregoing, if any financial statements referred to above are not delivered
within the time periods specified in Section 5.01, then, until the date on which such financial statements are delivered, the highest rate set forth in each column of the
Pricing Grid shall apply. In addition, at all times while an Event of Default shall have occurred and be continuing, the highest rate set forth in each column of the
Pricing Grid shall apply. Each determination of the Consolidated Net Leverage Ratio pursuant to the Pricing Grid shall be made in a manner consistent with the
determination thereof pursuant to Section 6.10.
“ Prime Rate ” means the rate of interest per annum publicly announced from time to time by JPMorgan Chase Bank, N.A. as its prime rate in effect at its
principal office in New York City; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being
effective.
“ Princeton Review Group ” means the line of business operated by TPR Education Offshore Holdings LLC and its subsidiaries as of the Term B-1
Effective Date as reasonably determined by the Borrower.
“ Pro Rata Extension Offer ” has the meaning assigned to such term in Section 2.19(a).
“ Public Lender ” has the meaning assigned to such term in Section 9.18.
“ Purchase Offer ” has the meaning assigned to such term in Section 2.21(a).
“ Qualified Equity Interests ” of any Person means Equity Interests of such Person other than Disqualified Equity Interests. Unless otherwise specified,
Qualified Equity Interests refer to Qualified Equity Interests of the Borrower.
“ Quotation Day ” means, with respect to any Eurocurrency Borrowing for any Interest Period, (i) if the cur- rency is Sterling, Australian Dollars or
Canadian Dollars, the first day of such Interest Period, (ii) if the currency is Euro, two TARGET2 Days before the first day of such Interest Period, (iii) for any other
currency, two Business Days prior to the commencement of such Interest Period (unless, in each case, market practice differs in the relevant market where the
Eurocurrency Rate for such currency is to be determined, in which case the Quotation Day will be determined by the Administrative Agent in accordance with
market practice in such market (and if quotations would normally be given on more than one day, then the Quotation Day will be the last of those days)).
“ Recovery Event ” means any event that gives rise to the receipt by the Borrower or any of its Subsidiaries of any insurance proceeds or condemnation
awards in respect of any equipment, fixed assets or real property (in- cluding any improvements thereon).
“ Reference Bank Rate ” means the arithmetic mean of the rates (rounded upwards to four decimal places) supplied to the Administrative Agent at its
request by the Reference Banks (as the case may be) as of the Specified Time on the Quotation Day for Loans in the applicable currency and the applicable Interest
Period:
(a)
in relation to Loans in Australian Dollars, as the bid rate observed by the relevant Refer- ence Bank for Australian Dollars
denominated bank accepted bills and negotiable certificates of deposit is- sued by banks which are for the time being designated “Prime Banks” by the
Australian Financial Markets Association that have a remaining maturity equal to the relevant Interest Period;
34
(b)
in relation to Loans in Canadian Dollars, as the rate at which the relevant Reference Bank is willing to extend credit by the purchase
of bankers acceptances which have been accepted by banks which are for the time being customarily regarded as being of appropriate credit standing for
such purpose with a term to maturity equal to the relevant period; and
(c)
in relation to Loans in any currency other than AUD, CAD and Euros, as the rate at which the relevant Reference Bank could borrow
funds in the London interbank market in the relevant currency and for the relevant period, were it to do so by asking for and then accepting interbank offers
in reasonable market size in that currency and for that period;
provided , that if any Reference Bank Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Agreement
“ Reference Banks ” means such banks as may be selected by the Administrative Agent (subject to consent by each such Reference Bank) and are
reasonably acceptable to the Borrower.
“ refinance ” means, in respect of any Indebtedness, to refinance, extend, renew, refund, repay, prepay, or to issue other Indebtedness in exchange or
replacement for, such Indebtedness.
“ Refinanced Indebtedness ” has the meaning assigned to such term in the definition of “Refinancing Indebtedness.
“ Refinancing Amendment ” has the meaning assigned to such term in Section 2.20(e).
“ Refinancing Effective Date ” has the meaning assigned to such term in Section 2.20(a).
“ Refinancing Indebtedness ” means Indebtedness of the Borrower or a Restricted Subsidiary incurred in ex- change for, or the proceeds of which are used
to redeem or refinance in whole or in part, any Indebtedness of the Borrower or any Restricted Subsidiary (the “ Refinanced Indebtedness ”); provided that:
(a)
the principal amount (and accreted value, in the case of Indebtedness issued at a discount) of the Refinancing Indebtedness does not
exceed the principal amount (and accreted value, as the case may be) of the Refinanced Indebtedness plus the amount of accrued and unpaid interest on the
Refinanced Indebtedness, any premium paid to the holders of the Refinanced Indebtedness and expenses incurred in connection with the incurrence of the
Refinancing Indebtedness;
(b)
the obligor of Refinancing Indebtedness does not include any Person (other than the Bor- rower or any Restricted Subsidiary) that is
not an obligor of the Refinanced Indebtedness;
(c)
if the Refinanced Indebtedness was by its terms subordinated in right of payment to the Loans or the Guarantee Agreement, as the
case may be, then such Refinancing Indebtedness, by its terms, is subordinate in right of payment to the Loans or the Guarantee Agreement, as the case
may be, at least to the same extent as the Refinanced Indebtedness;
(d)
the Refinancing Indebtedness has a final stated maturity either (a) no earlier than the Re- financed Indebtedness being redeemed or
refinanced or (b) after the date that is 90 days after the last ma- turity date applicable to the Loans at the time the Refinancing Indebtedness is incurred; and
(e)
the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or pri- or to the last maturity date applicable to the
Loans at the time the Refinancing Indebtedness is incurred has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is incurred
that is equal to or greater than the Weighted Average Life to Maturity of the portion of the Refinanced Indebtedness being redeemed or refinanced that is
scheduled to mature on or prior to the last maturity date applicable to the Loans at the time the Refinancing Indebtedness is incurred ( p rovided that
Refinancing Indebtedness in re- spect of Refinanced Indebtedness that has no amortization may provide for amortization installments, sink-
35
ing fund payments, senior maturity dates or other required payments of principal of up to 1% of the aggre- gate principal amount per annum).
“ Refinancing Term Loans ” has the meaning assigned to such term in Section 2.20(a).
“ Register ” has the meaning assigned to such term in Section 9.05(b)(iv).
“ Related Business ” means any business in which the Borrower or any Restricted Subsidiary was engaged on the Closing Date or any reasonable extension
of such business and any business related, ancillary or complementary to any business of the Borrower or any Restricted Subsidiary in which the Borrower or any
Restricted Subsidiary was engaged on the Closing Date or any reasonable extension of such business.
“ Related Parties ” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and
advisors of such Person and such Person’s Affiliates.
“ Reorganization ” means, with respect to any Multiemployer Plan, the condition that such plan is in reor- ganization within the meaning of Section 4241 of
ERISA.
“ Replacement Revolving Facilities ” has the meaning assigned to such term in Section 2.20(c).
“ Replacement Revolving Facility Commitments ” has the meaning assigned to such term in Section 2.20(c).
“ Replacement Revolving Facility Effective Date ” has the meaning assigned to such term in Section 2.20(c).
“ Replacement Revolving Loans ” has the meaning assigned to such term in Section 2.20(c).
“ Repricing Event ” means (i) any prepayment or repayment of Term B-1 Loans with the proceeds of, or conversion of all or any portion of the Term B-1
Loans into, any new or replacement term loans bearing interest with an All-in Yield less than the All-in Yield applicable to the Term B-1 Loans subject to such
event (as such com- parative yields are determined by the Administrative Agent); provided that in no event shall any prepayment or re- payment of Term B-1 Loans
in connection with a Change of Control constitute a Repricing Event and (ii) any amendment to this Agreement which reduces the All-in Yield applicable to the
Term B-1 Loans (it being understood that any prepayment premium with respect to a Repricing Event shall apply to any required assignment by a Non- Consenting
Lender in connection with any such amendment pursuant to Section 2.16(c)).
“ Required Lenders ” means, at any time, Lenders having Term Loans and Revolving Commitments (or, if the Revolving Commitments have terminated,
Total Revolving Exposure outstanding) that, taken together, represent more than 50% of the sum of (x) all Term Loans and (y) all Revolving Commitments (or, if
the Revolving Commitments have terminated, Total Revolving Exposure outstanding) at such time; provided , that the Term Loans, Revolving Commitments and
Total Revolving Exposure of any Defaulting Lender shall be disregarded in determining Required Lenders at any time.
“ Required Percentage ” means, with respect to any Excess Cash Flow Period, 75%; provided , that, if the Secured Net Leverage Ratio as of the end of such
Excess Cash Flow Period is (x) less than or equal to 2.25 to 1.00 but greater than 2.00 to 1.00, such percentage shall be 50%, (y) less than or equal to 2.00 to 1.00 but
greater than
1.50 to 1.00, such percentage shall be 25% or (z) less than or equal to 1.50 to 1.00, such percentage shall be 0%.
“ Required Revolving Lenders ” means, at any time, Revolving Lenders having Revolving Commitments (or if the Revolving Commitments have
terminated, Total Revolving Exposure outstanding) that, taken together, represent more than 50% of the sum of all Revolving Commitments (or, if the Revolving
Commitments have terminated, Total Revolving Exposure outstanding at such time; provided , that the Revolving Commitments and Total Revolving Exposure
outstanding of any Defaulting Lender shall be disregarded in determining Required Revolving Lenders at any time.
36
“ Requirements of Law ” means, as to any Person, the Certificate of Incorporation and By-Laws or other or- ganizational or governing documents of such
Person, and any law, treaty, rule, regulation or official administrative pronouncement or determination of an arbitrator or a court or other Governmental Authority, in
each case applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.
“ Restricted Payment ” means (a) any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in the
Borrower or any Restricted Subsidiary, (b) any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of
the pur- chase, redemption, retirement, acquisition, cancellation or termination of any such Equity Interests of the Borrower or any option, warrant or other right to
acquire any such Equity Interests or (c) any Junior Debt Restricted Payment.
“ Restricted Subsidiary ” means any subsidiary of the Borrower other than Unrestricted Subsidiaries.
“ Retained Excess Cash Flow Amount ” means, as at any date of determination, an amount determined on a cumulative basis equal to, without duplication,
(a) the cumulative amount of Excess Cash Flow for all Excess Cash Flow Periods completed prior to such date, plus (b) the cumulative amount of all Declined
Prepayment Amounts, plus (c) following the date of the Match Offering, the net cash proceeds of any sale of Qualified Equity Interests by, or capital contribution to
the common equity of, the Borrower, minus (d) the amount of such Excess Cash Flow re- quired to be applied to prepay the Loans pursuant to Section 2.08(d)
during or with respect to such applicable Ex- cess Cash Flow Periods (without giving effect to any reduction in respect of prepayments of Indebtedness as provided
in clauses (ii)(a) and (b) thereof), minus (e) the cumulative amount of Restricted Payments made with Retained Excess Cash Flow from and after the Term B-1
Effective Date and on or prior to such time, minus (f) the cumulative amount of Investments made with Retained Excess Cash Flow from and after the Term B-1
Effective Date and on or prior to such time (net of any dividends, distributions, profits, returns or similar amounts in respect of any such In- vestments).
“ Revocation ” has the meaning assigned to such term in the definition of “Unrestricted Subsidiary.”
“ Revolving Commitment ” means, as to any Revolving Lender, the obligation of such Revolving Lender to make Revolving Loans and purchase
participation interests in Letters of Credit in an aggregate principal amount not to exceed the amount set forth under the heading “Revolving Commitment” opposite
such Lender’s name on Schedule 1.01A or in the Assignment and Assumption or Incremental Assumption Agreement pursuant to which such Revolving Lender
became a party hereto, as the same may be changed from time to time pursuant to the terms of this Agreement (including as increased, extended or replaced as
provided in Section 2.02, 2.19 and 2.20). The original aggregate Dollar Amount of all Revolving Commitments is $500,000,000.
“ Revolving Commitment Percentage ” means, with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Revolving
Commitment at such time to the Total Revolving Commitments at such time.
“ Revolving Commitment Period ” means the period from and including the Closing Date to the Revolving Termination Date.
“ Revolving Facility ” means the credit facility constituted by the Revolving Commitments and the exten- sions of credit thereunder.
“ Revolving Fee Payment Date ” means (a) the third Business Day following the last day of each March, June, September and December during the
Revolving Commitment Period and (b) the last day of the Revolving Commitment Period.
“ Revolving Lender ” means each Lender that has a Revolving Commitment or that holds Revolving Loans.
“ Revolving Loans ” has the meaning assigned to such term in Section 2.01(a).
“ Revolving Termination Date ” means the fifth anniversary of the Closing Date.
37
“ Sanctioned Country ” means, at any time, a country, region or territory which is itself the subject or target of any Sanctions (at the time of this Agreement,
Crimea, Cuba, Iran, North Korea, Sudan and Syria).
“ Sanctioned Person ” means, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign
Assets Control of the U.S. Department of the Treasury, the U.S. De- partment of State, the United Nations Security Council or the European Union or Her Majesty’s
Treasury, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person or Persons described in
the foregoing clauses (a) or (b).
“ Sanctions ” means all economic or financial sanctions or trade embargoes imposed, administered or en- forced from time to time by (a) the U.S.
government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State or (b) the
United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom.
“ Screen Rate ” means the LIBOR Screen Rate and the Local Screen Rates collectively and individually as the context may require.
“ SEC ” means the Securities and Exchange Commission or any successor thereto.
“ Secured Net Leverage Ratio ” means, as of any date of determination, the ratio of (i) Indebtedness of the Borrower and its Restricted Subsidiaries secured
by a Lien on any assets of the Borrower and its Restricted Subsidiaries as of the last day of the Test Period most recently ended on or prior to such date of
determination (as set forth on the balance sheet and determined on a consolidated basis in accordance with GAAP) minus the amount of unrestricted cash and Cash
Equivalents of the Borrower and its Restricted Subsidiaries on such date in an amount not to exceed (x) prior to the Term B-1 Loan Repayment Date, $100,000,000
and (y) on or after the Term B-1 Loan Re- payment Date, $200,000,000 to (ii) Consolidated EBITDA for such Test Period.
(A) The Secured Net Leverage Ratio shall be calculated for any period after giving effect on a pro forma basis (as if they had occurred on the first day of
the applicable Test Period) to:
(1) the incurrence of any Indebtedness of the Borrower or any Restricted Subsidiary (and the application of the proceeds thereof) and any
repayment, repurchase, defeasance or other discharge of Indebtedness (and the application of the proceeds therefrom) (other than the incurrence or
repayment of Indebtedness in the ordinary course of business for working capital purposes pursuant to any revolving credit arrangement) occurring during
the applicable Test Period or at any time subsequent to the last day of such Test Period and on or prior to the date of determination, as if such incurrence,
repayment, issuance or redemption, as the case may be (and the application of the proceeds thereof), occurred on the first day of the Test Period;
(2) any (w) Asset Sale, (x) asset sale if the Fair Market Value of the assets sold in such trans- action or series of related transactions exceeds
$2,000,000, which is solely excluded from the definition of Asset Sale pursuant to clause (7) of such definition ), (y) Asset Acquisition (including, without
limitation, any Asset Acquisition giving rise to the need to make such calculation as a result of the Borrower or any Restricted Subsidiary (including any
Person who becomes a Restricted Subsidiary as a result of such Asset Acquisition or as a result of a Revocation)) incurring Acquired Indebtedness and also
including any Consolidated EBITDA associated with any such Asset Acquisition) or (z) operational restructuring (each a “ pro forma event ”) (including
any cost savings and synergies resulting from head count reduction, closure of facilities and similar operational and other cost savings and synergies
relating to such pro forma event occur- ring within 12 months (or expected, in the good faith determination of the Borrower, to occur within 12 months) of
such pro forma event and during such period or subsequent to such period and on or prior to the date of such calculation, in each case that are expected to
have a continuing impact and are factually supportable, and which adjustments the Borrower determines are reasonable as set forth in an Officer’s
Certificate; provided that the aggregate amount of all such cost savings and synergies pursuant to this clause (A)(2) and the second paragraph of the
definition of “Consolidated EBITDA” shall in no event exceed 10% of Consolidated EBITDA for such period calculated prior to giving effect to such pro
forma adjustments)
38
occurring during the Test Period or at any time subsequent to the last day of the Test Period and on or prior to the date of determination, as if such pro
forma event occurred on the first day of the Test Period and; provided , further , that asset sales described in clause (A)(2)(x) in an aggregate amount not to
exceed
$50,000,000 in any Test Period shall not be required to be given pro forma effect; and
(B) in calculating Consolidated Interest Expense for purposes of the Secured Net Leverage Ratio with respect to any Indebtedness being given pro forma
effect:
(1) interest on outstanding Indebtedness determined on a fluctuating basis as of the date of determination and which will continue to be so
determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on such Indebtedness in effect on the date of
determination;
(2) if interest on any Indebtedness actually incurred on the date of determination may option- ally be determined at an interest rate based upon a
factor of a prime or similar rate, a eurocurrency inter- bank offered rate, or other rates, then the interest rate in effect on the date of determination will be
deemed to have been in effect during the Test Period;
(3) notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a fluctu- ating basis, to the extent such interest is covered by
agreements relating to Hedging Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of the agreements
gov- erning such Hedging Obligations;
(4) interest on any Indebtedness under a revolving credit facility shall be computed based upon the average daily balance of such Indebtedness
during the Test Period; and
(5) interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate rea- sonably determined by a responsible financial or
accounting Officer of the Borrower to be the rate of inter- est implicit in such Capital Lease Obligation in accordance with GAAP.
“ Secured Parties ” has the meaning assigned to such term in the Pledge Agreement.
“ Separation Date ” means the date on which the Borrower is designated as an Unrestricted Subsidiary under and in accordance with the IAC Credit
Agreement and each of the indentures governing the IAC Senior Notes, as applicable, in connection with the Match Transactions.
“ Senior Notes ” means the up to $500,000,000 aggregate principal amount of 6.75% Senior Notes due 2022 issued by the Borrower in connection with the
offer to exchange any and all outstanding IAC 2012 Senior Notes launched on October 16, 2015, and any exchange notes related thereto.
“ Specified Swap Agreement ” means any Swap Agreement in respect of interest rates or currency exchange rates entered into by the Borrower or any
Subsidiary Guarantor and any Person that (i) at the time such Swap Agreement is entered into is a Lender or an Agent Party or an Affiliate of a Lender or an Agent
Party or (ii) in the case of any such Swap Agreement in effect on or prior to the Closing Date, is, as of the Closing Date, a Lender or an Agent Party or an Affiliate of
a Lender or an Agent Party, unless, when entered into, such Swap Agreement is des- ignated in writing by the Borrower and such Lender or Agent Party or Affiliate
of a Lender or Agent Party to the Administrative Agent to not be included as a Specified Swap Agreement.
“ Specified Time ” means approximately 11:00 a.m., London time.
“ Standard & Poor’s ” means Standard & Poor’s Rating Services a division of The McGraw-Hill Companies, Inc.
“ Sterling ” and “ £ ” mean the lawful currency of the United Kingdom.
“ subsidiary ” means, with respect to any Person (the “ parent ”):
39
(1)
any corporation, limited liability company, association or other business entity of which more than 50% of the total voting power of
the Equity Interests entitled (without regard to the occurrence of any contingency) to vote in the election of the board of directors thereof is at the time
owned or con- trolled, directly or indirectly, by such Person or one or more of the other subsidiaries of such Person (or a combination thereof); and
(2)
any partnership (a) the sole general partner or the managing general partner of which is such Person or a subsidiary of such Person or
(b) the only general partners of which are such Person or one or more subsidiaries of such Person (or any combination thereof).
“ Subsidiary Guarantor ” means each Domestic Subsidiary that is a party to the Guarantee Agreement; pro- vided that no Excluded Subsidiary shall be
required to be a Subsidiary Guarantor of any obligations under this Agreement.
“ Swap Agreement ” means any agreement with respect to any swap, forward, future or derivative transac- tion or option or similar agreement involving, or
settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of
economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that no phantom stock or similar plan
providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Borrower or the Restricted
Subsidiaries shall be a Swap Agreement.
“ Swap Obligation ” means, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a
“swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.
“ Syndication Agent ” means Bank of America, N.A..
“ TARGET2 Day ” means any day on which the Trans-European Automated Real-time Gross Settlement Express Transfer ( TAR GET2 ) payment system
(or, if such payment system ceases to be operative, such other pay- ment system reasonably determined by the Administrative Agent to be a suitable replacement) is
open for the set- tlement of payments in Euro.
“ Taxes ” means all present or future taxes, levies, imposts, duties, deductions, charges or withholdings im- posed by any Governmental Authority,
including any interest, additions to tax or penalties applicable thereto.
“ Term B-1 Commitment ” means, as to any Term B-1 Lender, the obligation of such Term B-1 Lender to make Term B-1 Loans in an aggregate principal
amount not to exceed the amount set forth opposite such Lender’s name on Schedule I of the Incremental Assumption Agreement No. 1 or in the Assignment and
Assumption or In- cremental Assumption Agreement pursuant to which such Term B-1 Lender became a party hereto as the same may be changed from time to time
pursuant to the terms of this Agreement (including as increased, extended or replaced as provided in Section 2.02, 2.19 and 2.20). The original aggregate amount of
all Term B-1 Commitments is
$800,000,000.
“ Term B-1 Effective Date ” has the meaning assigned to such term in the Incremental Assumption Agree- ment No. 1.
“ Term B-1 Facility ” means the credit facility constituted by the Term B-1 Commitments and the Term B-1 Loans thereunder.
“ Term B-1 Lender ” means each Lender that has a Term B-1 Commitment or that holds Term B-1 Loans.
“ Term B-1 Loan Repayment Date ” means the date on which all Term B-1 Loans are no longer outstanding.
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“ Term B-1 Loans ” means the Term Loans made pursuant to the Term B-1 Commitment.
“ Term B-1 Maturity Date ” means the date that is seven years from the Term B-1 Effective Date; provided that, if any Senior Notes remain outstanding on
the date that is 91 days prior to the maturity date of the Senior Notes, the Term B-1 Maturity Date shall be the date that is 91 days prior to the maturity date of the
Senior Notes.
“ Term Facility ” means a credit facility in respect of Term Loans hereunder including the Term B-1 Facility.
“ Term Lender ” means each Lender that holds Term Loans.
“ Term Loan Commitment ” means any Commitment in respect of Term Loans including the Term B-1 Commitments.
“ Term Loan Standstill Period ” has the meaning assigned to such term in Section 7.01(d).
“ Term Loans ” means the Term B-1 Loans, any Incremental Term Loan, Extended Term Loan or Refinanc- ing Term Loans incurred hereunder; provided
that no Escrow Incremental Term Loan shall be deemed to be a Term Loan outstanding hereunder until the Escrow Assumption with respect thereto shall have
occurred.
“ Test Period ” means the four consecutive fiscal quarter period most recently ended; provided that, prior to the first date that financial statements shall
have been delivered pursuant to Section 5.01, the Test Period in effect shall be the period of four consecutive fiscal quarters of the Borrower ended June 30, 2015. A
Test Period may be designated by reference to the last day thereof (i.e. the June 30, 2015 Test Period refers to the period of four consec- utive fiscal quarters of the
Borrower ended June 30, 2015), and a Test Period shall be deemed to end on the last day thereof.
“ Total Assets ” means, as of any date of determination, the total assets of the Borrower and its Restricted Subsidiaries, determined on a consolidated basis
in accordance with GAAP, as set forth on the most recent consoli- dated balance sheet of the Borrower as of such date (which calculation shall give pro forma effect
to any acquisition or asset sale by the Borrower or any of its Restricted Subsidiaries, in each case involving the payment or receipt by the Borrower or any of its
Restricted Subsidiaries of consideration (whether in the form of cash or non-cash consideration) in excess of $50,000,000 that has occurred since the date of such
consolidated balance sheet, as if such acquisition or Asset Sale had occurred on the last day of the fiscal period covered by such balance sheet).
“ Total Percentage ” means, with respect to any Lender at any time, the ratio (expressed as a percentage) of such Lender’s Aggregate Exposure at such time
to the Aggregate Exposure of all Lenders at such time.
“ Total Revolving Commitments ” means, at any time, the aggregate principal amount of the Revolving Commitments then in effect.
“ Total Revolving Exposure ” means, at any time, the sum of the Total Revolving Loans and LC Exposure outstanding at such time.
“ Total Revolving Loans ” means, at any time, the aggregate principal amount of the Revolving Loans of the Revolving Lenders outstanding at such time.
“ Transactions ” means the execution, delivery and performance by the Borrower of this Agreement, the ex- ecution, delivery and performance by the Loan
Parties of the other Loan Documents, the borrowing of Loans and the use of proceeds thereof.
“ Tutor.com Group ” means the line of business operated by Tutor.com, Inc. and its subsidiaries as of the Term B-1 Effective Date as reasonably
determined by the Borrower.
“ Type ” means, as to any Loan, its nature as an ABR Loan or a Eurocurrency Loan.
41
“ Unrestricted Subsidiary ” means (a) any subsidiary of the Borrower listed on Schedule 1.01B, (b) any subsidiary of the Borrower that is designated as an
Unrestricted Subsidiary by the Borrower after the Closing Date in a written notice to the Administrative Agent and (c) any subsidiary of any subsidiary described in
clause (a) or (b) above; provided that (i) no Default shall have occurred and be continuing at the time of or after giving effect to the designation of a subsidiary as an
Unrestricted Subsidiary (a “ Design ation ”) and (ii) at the time of and immediately after giving effect to such Designation, the Borrower shall be in compliance with
Section 6.10; provided , further , that no subsidiary shall be designated as an Unrestricted Subsidiary unless (w) no creditor of such subsidiary shall have any claim
(whether pursuant to a Guarantee or otherwise) against the Borrower or any of its Restricted Subsidiaries in respect of any Indebtedness or other obligation (except
for obligations arising by operation of law, including joint and several liability for taxes, ERISA and similar items) of such subsidiary (collectively, “Unrestricted
Subsidiary Support Obligations”), except pursuant to Investments which are made in accordance with Section 6.11;such subsidiary is not party to any transaction
with the Borrower or any Restricted Subsidiary unless the terms of such transaction complies with Section 6.06 and (y) no Investments may be made in any such
subsidiary by the Borrower or any Restricted Subsidiary except to the extent permitted under Section 6.11 other than Section 6.11(e) (it being understood that, if a
subsidiary is designated as an Unrestricted Subsidiary after the Closing Date, the aggregate Fair Market Value of all outstanding Investments owned by the Borrower
and its Restricted Subsidiaries in the subsidiary so designated shall be deemed to be an Investment made as of the time of such designation and shall be subject to the
limits set forth in Section 6.11 (other than Section 6.11(e))). It is understood that Unrestricted Subsidiaries shall be disregarded for the purposes of any calculation
pursuant to this Agreement relating to financial matters with respect to the Borrower.
The Borrower may revoke the designation of a subsidiary as an Unrestricted Subsidiary pursuant to a writ- ten notice to the Administrative Agent so long
as, after giving pro forma effect to such revocation, (i) (x) the Con- solidated Net Leverage Ratio shall be less than or equal to the Consolidated Net Leverage Ratio
and (y) the Interest Coverage Ratio shall be equal to or higher than the Interest Coverage Ratio, in each case, then required to be main- tained by the Borrower
pursuant to Section 6.10 and (ii) no Default shall be in existence( a “ Revo cation ”). Upon any Revocation, such Unrestricted Subsidiary shall constitute a Restricted
Subsidiary for all purposes of this Agreement and the Borrower shall comply with Section 5.09 if such subsidiary is a Material Domestic Subsidiary. In the case of
any Revocation, if the designation of such subsidiary as an Unrestricted Subsidiary caused the availa- ble basket amount referred to in Section 6.11 (other than
Section 6.11(e)) to be utilized by an amount equal to the aggregate Fair Market Value of all outstanding Investments owned by the Borrower and its Restricted
Subsidiaries in the subsidiary so designated (the amount so utilized, the “ Designation Amo unt”), then, effective upon such Revo- cation, such available basket
amount shall be increased by the lesser of (i) the Designation Amount and (ii) the ag- gregate Fair Market Value of all outstanding Investments owned by the
Borrower and its Restricted Subsidiaries in such subsidiary at the time of such Revocation.
“ Unrestricted Subsidiary Support Obligations ” has the meaning assigned to such term in the definition of “Unrestricted Subsidiary.”
“ U.S. Lender ” means any Lender that is a “United States person” within the meaning of Section 7701(a)(30) of the Code.
“ U.S. Tax Compliance Certificate ” has the meaning assigned to such term in Section 2.14(e)(ii)(B)(3).
“ Voting Stock ” means the stock of the class or classes pursuant to which the holders thereof have the gen- eral voting power under ordinary circumstances
to elect at least a majority of the Board of Directors of the Borrower (irrespective of whether or not at the time stock of any other class or classes shall have or might
have voting power by reason of the happening of any contingency).
“ Weighted Average Life to Maturity ” when applied to any Indebtedness at any date, means the number of years obtained by dividing (a) the sum of the
products obtained by multiplying (i) the amount of each then remain- ing installment, sinking fund, serial maturity or other required payment of principal, including
payment at final ma- turity, in respect thereof by (ii) the number of years (calculated to the nearest one-twelfth) that shall elapse between such date and the making
of such payment by (b) the then outstanding principal amount of such Indebtedness.
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“ Wholly Owned Subsidiary ” means a subsidiary of which 100% of the Equity Interests (except for direc- tors’ qualifying shares or certain minority
interests owned by other Persons solely due to local law requirements that there be more than one stockholder, but which interest is not in excess of what is required
for such purpose) are owned directly by the Borrower or through one or more Wholly Owned Subsidiaries and, solely for the purpose of the definition of “Material
Domestic Subsidiary,” excluding any subsidiary whose sole assets are Equity Interests in one or more subsidiaries that are not Wholly Owned Subsidiaries.
“ Withdrawal Liability ” means 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.
“ Yen ” and “ ¥ ” mean the lawful currency of Japan.
SECTION 1.02 Classification of Loans and Borrowings . For purposes of this Agreement, Loans may be classified and referred to by Class ( e .g ., a
“Revolving Loan”) or by Type ( e .g ., a “Eurocurrency Loan”) or by Class and Type ( e. g ., a “Eurocurrency Revolving Loan”). Borrowings also may be classified
and referred to by Class ( e. g ., a “Revolving Borrowing”) or by Type ( e. g ., a “Eurocurrency Borrowing”) or by Class and Type ( e .g ., a “Eurocurrency
Revolving Borrowing”).
SECTION 1.03 Terms Generally . The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corre- sponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be
deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall.” Unless the
context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended, supplemented, restated, amended and restated, extended or otherwise modified (subject to
any restrictions on such amendments, supplements or modifications set forth herein), (b) any reference herein to any Person shall be construed to include such
Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its
entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and
Sections of, and Exhibits and Schedules to, this Agreement and (e) the words “asset” and “property” shall be construed to have the same meaning and effect and to
refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights. The foregoing standards shall also apply to
the other Loan Documents.
SECTION 1.04 Accounting Terms; GAAP . Except as otherwise expressly provided herein, all terms of an accounting or financial nature shall be
construed in accordance with GAAP, as in effect from time to time; provided that for purposes of any determinations associated with leases, including, without
limitation, determinations of whether such leases are capital leases, whether obligations under such leases are Capital Lease Obligations, the amount of any Capital
Lease Obligations associated with such leases, and the amount of operating expenses associated with such leases, Consolidated EBITDA, Consolidated Interest
Expense, Indebtedness, the Consolidated Net Leverage Ratio, the Secured Net Leverage Ratio and the Interest Coverage Ratio shall be determined based on
generally accepted accounting principles in the United States of America in effect on the Closing Date; provided , furthe r, that, if the Borrower notifies the
Administrative Agent that the Borrower requests an amendment to any provision hereof to eliminate the effect of any change occurring after the Closing Date in
GAAP or in the application thereof 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, 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.
SECTION 1.05 Change of Currency . Each provision of this Agreement also shall be subject to such reasonable changes of construction as the
Administrative Agent may from time to time specify after consultation with the Borrower to be appropriate to the extent necessary to reflect a change in currency of
any country and any relevant market conventions or practices relating to such change in currency.
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SECTION 1.06 Currency Equivalents Generally .
(a)
Unless the context otherwise requires, any amount specified in this Agreement to be in Dollars shall also include the Dollar Amount of any
Alternative Currency. The maximum amount of Indebtedness and other threshold amounts that the Borrower and its Restricted Subsidiaries may incur under Article
VI shall not be deemed to be exceeded, with respect to any outstanding Indebtedness and other threshold amounts solely as a result of fluc- tuations in the exchange
rate of currencies. When calculating capacity for the incurrence of additional Indebtedness and other threshold amounts by the Borrower and any Restricted
Subsidiary, the exchange rate of currencies shall be measured as of the date of such calculation.
(b)
(i)The Administrative Agent shall determine the Dollar Amount of any Letter of Credit denomi- nated in an Alternative Currency as of the date
of the issuance thereof and on the first Business Day of each calendar month on which such Letter of Credit is outstanding, in each case using the Exchange Rate in
effect on the date of determination, and each such amount shall be the Dollar Amount of such Letter of Credit until the next required calculation thereof pursuant to
this Section. The Administrative Agent shall in addition determine the Dollar Amount of any Letter of Credit denominated in an Alternative Currency as provided in
Sections 2.17(e) and 2.17(l).
(ii)
Administrative Agent shall determine the Dollar Amount of any Borrowing denominated in an Al- ternative Currency on or about the date of the
commencement of the initial Interest Period therefor and as of the date of the commencement of each subsequent Interest Period therefor, in each case using the
Exchange Rate in effect on the date of determination, and each such amount shall, except as provided in the next sentence, be the Dollar Amount of such Borrowing
until the next required calculation thereof pursuant to this Section.
(iii)
The Administrative Agent may also determine the Dollar Amount of any Borrowing or Letters of Credit denominated in an Alternative
Currency as of such other dates as the Administrative Agent shall determine, in each case using the Exchange Rate in effect on the date of determination, and each
such amount shall be the Dol- lar Amount of such Borrowing or Letter of Credit until the next calculation thereof pursuant to this Section.
(iv)
The Administrative Agent shall notify the Borrower, the applicable Lenders and the Issuing Bank of each determination of the Dollar Amount
of each Letter of Credit, Borrowing and LC Disbursement.
(c)
Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit
in effect at such time; provided , however , that with respect to any Letter of Credit that, by its terms or the terms of any other document related thereto, provides for
one or more automatic in- creases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter
of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time s.
SECTION 2.01 Commitments .
ARTICLE II
The Credits
(a)
Subject to the terms and conditions hereof, from time to time during the Revolving Commitment Period, each Revolving Lender severally
agrees to make to the Borrower revolving credit loans denominated in Dollars or an Alternative Currency ( “Revo lving Loans ”) in an aggregate principal amount
that will not result at the time of such Borrowing in (A) the Dollar Amount of such Lender’s Outstanding Revolving Credit under the Revolving Commitments
exceeding such Lender’s Revolving Commitment or (B) the Dollar Amount of Revolving Loans in Alternative Currencies exceeding the Alternative Currency
Revolving Sublimit. During the Revolving Commitment Period the Borrower may use the Revolving Commitments by borrowing, prepaying the Revolving Loans in
whole or in part, and reborrowing, all in accordance with the terms and conditions hereof. The Revolving Loans may from time to time be Eurocurrency Loans or, in
the case of Revolving Loans in Dollars, ABR Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with Sections 2.03 and
2.05. Each Revolving Loan under the Revolving Commitments shall be made as part of a Borrowing consisting of Revolving Loans made by the
44
Revolving Lenders thereunder ratably in accordance with their respective Revolving Commitments. The failure of any Revolving Lender to make any Revolving
Loan required to be made by it shall not relieve any other Revolving Lender of its obligations hereunder; provided that the Revolving Commitments of the
Revolving Lenders are several and no Revolving Lender shall be responsible for any other Revolving Lender’s failure to make Revolving Loans as required. When
more than one Class of Revolving Loans exists, each Borrowing of Revolving Loans shall be made pro rata across each Class.
(b)
Subject to the terms and conditions hereof and in the Incremental Assumption Agreement No. 1, each Term B-1 Lender severally agrees to
make to the Borrower Term B-1 Loans denominated in Dollars on the Term B-1 Effective Date in an amount equal to such Term B-1 Lender’s Term B-1
Commitment. Term B-1 Loans that are repaid or prepaid may not be reborrowed.
(c)
At the commencement of each Interest Period for any Eurocurrency Borrowing, such Borrowing shall be in an aggregate principal amount that
is an integral multiple of $1,000,000 and not less than $5,000,000 (or comparable amounts determined by the Administrative Agent in the case of Alternative
Currency). At the time that each ABR Borrowing is made, such Borrowing shall be in an aggregate principal amount that is an integral multiple of $1,000,000 and
not less than $5,000,000; provided that an ABR Borrowing may be in an aggregate principal amount that is equal to the entire unused balance of the applicable
outstanding Commitment. Borrowings of more than one Type and Class may be outstanding at the same time; provided that there shall not at any time be more than
a total of 15 Eurocurrency Borrowings outstanding.
SECTION 2.02 Incremental Revolving Commitments and Incremental Term Loans .
(a)
The Borrower may, by written notice to the Administrative Agent from time to time, request In- cremental Term Loan Commitments and/or
Incremental Revolving Commitments, as applicable, in an amount not to exceed the Incremental Amount available at the time such Incremental Term Loans are
funded or established (if commitments in respect of such Incremental Term Loans are established on a date prior to funding) or Incremental Revolving
Commitments are established (except, in each case, as set forth in the final paragraph under Section 6.01) from one or more Incremental Term Lenders and/or
Incremental Revolving Lenders (which, in each case, may in- clude any existing Lender (but no such Lender shall be required to participate in any such Incremental
Facility with- out its consent), but shall be required to be persons which would qualify as assignees of a Lender in accordance with Section 9.05) willing to provide
such Incremental Term Loans and/or Incremental Revolving Commitments, as the case may be, in their sole discretion; provided that (i) each Incremental Revolving
Lender providing a commitment to make revolving loans shall be subject to the approval of the Administrative Agent and, to the extent the same would be required
for an assignment under Section 9.05, the Issuing Bank (which approvals shall not be unreasona- bly withheld, conditioned or delayed) and (ii) the aggregate
principal amount of Incremental Term A Loans permit- ted to be incurred hereunder shall not exceed $250,000,000. Such notice shall set forth (i) the amount of the
Incre- mental Term Loan Commitments and/or Incremental Revolving Commitments being requested (which shall be in minimum increments of $5,000,000 and a
minimum amount of $10,000,000, or equal to the remaining Incremental Amount or, in each case, such lesser amount approved by the Administrative Agent), (ii)
the date on which such Incremental Term Loan Commitments and/or Incremental Revolving Commitments are requested to become effec- tive and (iii) whether
such Incremental Facility is an Incremental Term A Facility.
(b)
The Borrower and each Incremental Term Lender and/or Incremental Revolving Lender shall execute and deliver to the Administrative Agent
an Incremental Assumption Agreement and such other documentation (including, without limitation, amendments to this Agreement) as the Administrative Agent
shall reasonably specify to evidence the Incremental Term Loan Commitment of such Incremental Term Lender and/or Incremental Revolving Commitment of such
Incremental Revolving Lender. Each Incremental Assumption Agreement shall specify the terms of the applicable Incremental Term Loans and/or Incremental
Revolving Commitments; provided that:
(i)
any Incremental Revolving Commitments shall have the same terms as the Revolving Commitments, shall require no scheduled
amortization or mandatory commitment reduction prior to the Revolving Termination Date and shall be on the same terms and pursuant to the same
documentation applicable to the Revolving Commitments,
45
(ii)
except with respect to any Escrow Incremental Term Loans until the assumption by the Borrower thereof, the Incremental Term
Loans shall not be guaranteed by any subsidiaries of the Borrower that do not guarantee the Obligations and shall be secured on a pari passu basis by the
same Collateral (and no additional Collateral) securing the Obligations,
(iii)
the scheduled final maturity date of any Incremental Term A Facility shall be no earlier than the Revolving Termination Date and the
scheduled final maturity date of any other Incremental Term Facility shall be no earlier than the later of (x) 90 days following the Revolving Termination
Date and (y) the scheduled final maturity date of any then outstanding Term Loans,
(iv)
no Incremental Facility (other than the Term B-1 Term Loans incurred on the Term B-1 Effective Date and an Incremental Term A
Facility) shall require scheduled amortization payments (excluding the final installment thereof) in excess of 1.00% per annum of the original aggregate
principal amount thereof; and
(v)
any Incremental Term Facility shall be on terms (other than pricing, amortization, maturi- ty, prepayment premiums and mandatory
prepayments) and pursuant to documentation substantially similar to the Revolving Facility or otherwise reasonably acceptable to the Administrative Agent;
provided that such Incremental Facilities (x) shall have no financial maintenance covenants of a different type than the financial covenants set forth in
Section 6.10, and no financial maintenance covenants that are more restric- tive than the financial covenants set forth in Section 6.10 and (y) shall not have
negative covenants and/or default provisions that, taken as a whole, are materially more restrictive than those applicable to the Re- volving Facility as
determined in good faith by the Borrower unless, in each case of clauses (x) and (y) such terms (I) (if favorable to all then existing Lenders) are in
consultation with the Administrative Agent, incorporated into this Agreement for the benefit of all then existing Lenders (without further amendment
requirements); (II) become applicable only after the Revolving Facility shall have matured or been termi- nated and any Term Loans existing at such date
have been paid in full or (III) apply to Escrow Incremental Term Loans solely until the Escrow Assumption with respect thereto occurs; provided , however
, with re- spect to any Incremental Term Loans, the All-in Yield shall be as agreed by the respective Incremental Term Lenders and the Borrower, except
that the All-in Yield in respect of any such Incremental Term Loans may exceed the All-in Yield in respect of the Term B-1 Loans by no more than 0.50%,
or if it does so exceed such All-in Yield (such difference, the “ Term Yield Differential ”) then the Applicable Rate (or the “LIBOR floor” as provided in
the following proviso) applicable to such Term B-1 Loans shall be in- creased such that after giving effect to such increase, the Term Yield Differential
shall not exceed 0.50%; provided , that to the extent any portion of the Term Yield Differential is attributable to a higher “LIBOR floor” being applicable to
such Incremental Term Loans, such floor shall only be included in the calculation of the Term Yield Differential to the extent such floor is greater than the
Adjusted LIBO Rate in effect for an Interest Period of three months’ duration at such time, and, with respect to such excess, the “LIBOR floor” applicable
to the outstanding Term B-1 Loans shall be increased to an amount not to exceed the “LIBOR floor” applicable to such Incremental Term Loans prior to
any increase in the Applicable Rate ap- plicable to such Term B-1 Loans then outstanding.
(c)
Each party hereto hereby agrees that, upon the effectiveness of any Incremental Assumption Agreement, this Agreement shall be amended or
amended and restated to the extent (but only to the extent) neces- sary to reflect the existence and terms of the Incremental Term Loan Commitments and/or
Incremental Revolving Commitments evidenced thereby as provided for in Section 9.02. Any amendment or amendment and restatement to this Agreement or any
other Loan Document that is necessary to effect the provisions of this Section 2.02 (includ- ing, without limitation, to provide for the establishment of Incremental
Term Loans) and any such collateral and other documentation shall be deemed “Loan Documents” hereunder and may be memorialized in writing between the
Administrative Agent and the Borrower and furnished to the other parties hereto.
(d)
The Borrower may, by written notice to the Administrative Agent from time to time, request Es- crow Incremental Term Loans which shall be
incurred by an Escrow Borrower. Such notice shall set forth (i) the amount of the Escrow Incremental Term Loans being requested (which shall be in minimum
increments of
$5,000,000 and a minimum amount of $10,000,000, or equal to the then remaining Incremental Amount or, in each
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case, such lesser amount approved by the Administrative Agent), (ii) the date on which such Escrow Incremental Term Loans are requested to be borrowed by the
Escrow Borrower and (iii) the identity of the Escrow Borrower. The Escrow Incremental Term Loans shall be incurred by an Escrow Borrower; provided that:
(i) prior to the Escrow Assumption thereof, the Escrow Incremental Term Loans shall be in- curred pursuant to and governed by loan
documentation and escrow documentation, if any, separate from this Agreement and the other Loan Documents, which such loan documentation shall
specify (A) the terms of the Escrow Assumption Agreement, (B) the terms of the Incremental Term Loans following the Escrow Assumption of such
Escrow Incremental Term Loans and (C) that following the Escrow Assumption, the lenders thereunder shall agree to be bound by this Agreement and the
other Loan Documents as permitted to be amended by Section 2.02(c) and Section 9.02;
(ii) unless otherwise agreed by the Administrative Agent, the administrative agent and es- crow agent, if any, for such Escrow Incremental Term
Loans shall be the Administrative Agent; provided that if the Administrative Agent acts as administrative agent for such Escrow Incremental Term Loans,
the Administrative Agent in its capacity as administrative agent for such Escrow Incremental Term Loans shall receive (A) documentation and other
information requested by the Lenders that is required by regulatory authorities under applicable “know your customer” and anti-money-laundering rules and
regulations, including without limitation, the Act, in each case as requested at least three Business Days prior to the date on which such Escrow Incremental
Term Loans are requested to become effective and (B) all documents and legal opinions consistent with those delivered on the Closing Date as to such
matters as are reasonably requested by the Administrative Agent in its capacity as administrative agent for such Escrow Incremental Term Loans;
(iii) Escrow Incremental Term Loans shall not be deemed to be outstanding under this Agreement or any other Loan Document for any purposes
hereof (including, without limitation, for purposes of any financial calculation, the definition of “Obligations,” the definition of “Required Lenders” or
Section 7.01, 9.02 or 9.03 hereof) and the obligations with respect thereto shall not be recourse to the Borrower or any Restricted Subsidiary, in each case,
unless and until the Escrow Assumption with respect thereto shall have occurred;
(iv) at the time of the Escrow Assumption (A) the conditions specified in clauses (b) and (e) of this Section 2.02 (other than the condition in
2.02(e)(ii) with respect to complying with 4.02(c)) shall be satisfied as if the Borrower was borrowing such Escrow Incremental Term Loans on the date of
such Es- crow Assumption, (B) the Incremental Term Loan Commitments and/or Incremental Revolving Commitments plus such Escrow Incremental Term
Loans then outstanding do not exceed the Incremental Amount at such time and (C) the aggregate principal amount of Incremental Term A Loans
outstanding (including, if applicable, such Escrow Incremental Term Loans) incurred on or prior to such time do not exceed $250,000,000; and
(v) following any Escrow Assumption (A) each Escrow Incremental Term Loan assumed by the Borrower shall be deemed outstanding under
this Agreement as an Incremental Term Loan, (B) each of the lenders of such Escrow Incremental Term Loan shall be deemed to be Lenders hereunder, (C)
Escrow Incremental Term Loans that were Eurocurrency Loans of a particular Borrowing shall initially be Eurocurrency Loans of a Borrowing under this
Agreement with an initial Interest Period equal to the then remaining Interest Period for such Borrowing under this Agreement (and with the same
Eurocurrency Rate) and (D) Escrow Incremental Term Loans assumed by the Borrower that were ABR Loans shall initially be ABR Loans under this
Agreement.
(e)
Notwithstanding the foregoing, no Incremental Term Loan Commitment or Incremental Revolving Commitment shall become effective under
this Section 2.02 unless (i) no Default or Event of Default shall exist after giving pro forma effect to such Incremental Term Loan Commitment or Incremental
Revolving Commitment and the incurrence of Indebtedness thereunder and use of proceeds therefrom; provided , that in the event that any tranche of Incremental
Facilities that are used to finance an acquisition permitted hereunder, to the extent the Incremental Lenders participating in such Incremental Facility agree, the
foregoing clause (i) shall be tested at the time of the
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execution of the acquisition agreement related to such acquisition ( p rovided , that such Incremental Lenders shall not be permitted to waive any Default or Event of
Default then existing or existing after giving effect to such Incremental Facility); (ii) the conditions set forth in Section 4.02 have been complied with whether or not
a Borrowing is made under the Incremental Facility on such date (other than clause (c) thereof which shall only be required to be complied with if a Borrowing is
made on such date); (iii) after giving pro forma effect to such Incremental Term Loan Commitment or Incremental Revolving Commitment and the incurrence of
Indebtedness thereunder (assuming such commitments are fully drawn on such date) and use of proceeds therefrom the Borrower would be in compliance with
Section 6.10 as of the last day of the most recently ended Test Period only on the date of the initial incurrence of (or commitment in respect of) such Indebtedness;
and (iv) the Administrative Agent shall have received documents and legal opinions consistent with those delivered on the Closing Date as to such matters as are
reasonably requested by the Administrative Agent. The Administrative Agent shall promptly notify each Lender as to the effectiveness of each Incremental
Assumption Agreement.
(f)
Upon each increase in the establishment of any Incremental Revolving Commitments pursuant to this Section 2.02, each Lender immediately
prior to such increase will automatically and without further act be deemed to have assigned to each Incremental Revolving Lender providing a portion of the
Incremental Revolving Commitments in respect of such increase, and each such Incremental Revolving Lender will automatically and without further act be deemed
to have assumed, a portion of such Lender’s participations hereunder in outstanding Letters of Credit such that, after giving effect to each such deemed assignment
and assumption of participations, the percentage of the aggregate outstanding participations hereunder in Letters of Credit held by each Lender (including each such
Incremental Revolving Lender) will equal such Lender’s Revolving Commitment Percentage and if, on the date of such increase, there are any Revolving Loans
outstanding, such Revolving Loans shall on or prior to the effectiveness of such Incremental Revolving Commitments either be prepaid from the proceeds of
additional Revolving Loans made hereunder or assigned to an Incremental Revolving Lender (in each case, reflecting such Incremental Revolving Commitments,
such that Revolving Loans are held ratably in accordance with each Lender’s pro rata share, after giving effect to such increase), which prepayment or assignment
shall be accompanied by accrued interest on the Revolving Loans being prepaid. 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 the
immediately preceding sentence. If there is a new Revolving Borrowing on such Incremental Revolving Commitment Closing Date, the Revolving Lenders after
giving effect to such Incremental Revolving Commitments shall make such Revolving Loans in accordance with Section 2.01.
SECTION 2.03 Procedure for Borrowing .
(a)
To request a Revolving Borrowing or a Term B-1 Loan Borrowing on any Business Day, the Bor- rower shall notify the Administrative Agent
of such request (x) in the case of ABR Loans, by telephone (which no- tice must be received by the Administrative Agent prior to 12:00 noon, New York City time
on the requested Bor- rowing Date) or (y) in the case of Eurocurrency Loans, in writing (which notice must be received by the Administrative Agent prior to 12:00
noon, New York City time not less than (A) three Business Days prior to the requested Borrowing Date for Dollar Borrowing requests and (B) four Business Days
prior to the requested Borrowing Date for Alternative Currency Revolving Borrowing requests). Any borrowing request shall be irrevocable (but may be conditioned
on the occurrence of any event if the borrowing request includes a description of such event; provided that the relevant Lenders shall still be entitled to the benefits
of Section 2.13) and any telephonic borrowing request shall be confirmed promptly in writing. Each such telephonic and written borrowing request shall specify the
amount, currency and Type of Borrowing to be borrowed and the requested Borrowing Date. Upon receipt of such notice, the Administrative Agent shall promptly
notify each relevant Lender thereof. For the avoidance of doubt, subject to Section 2.11, each Borrowing shall be comprised entirely of ABR Loans or Eurocurrency
Loans as the Borrower may request in accordance herewith and all Revolving Loans made in Alternative Currencies shall be Eurocurrency Loans.
(b)
If no election as to the Type of Borrowing is specified for a Borrowing in Dollars, then the re- quested Borrowing shall be an ABR Borrowing.
If no Interest Period is specified with respect to any requested Eu- rocurrency Borrowing, then the Borrower shall be deemed to have selected an Interest Period of
one month’s dura- tion. If no currency is specified for a Revolving Borrowing, the requested Borrowing shall be in Dollars. In making
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any determination of the Dollar Amount for purposes of calculating the amount of Revolving Loans to be borrowed from the respective Lenders on any date, the
Administrative Agent shall use the relevant Exchange Rate in effect on the date on which the Borrower delivers a borrowing request for such Revolving Loans
pursuant to the provisions of Section 2.03(a).
SECTION 2.04 Funding of Borrowings .
(a)
Each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds (x)
in the case of any Loan denominated in Dollars, by 3:00 p.m. New York City time and (y) in the case of any Loan denominated in an Alternative Currency, by 12:00
noon local time in the place of settlement for such Alternative Currency, in each case to the account of the Administrative Agent most recently designated by it for
such purpose by notice to the Lenders. The Administrative Agent will make such Loans available to the Borrower by promptly crediting the amounts so received, in
like funds, to an account of the Borrower maintained with the Administrative Agent in New York City or to any other account as shall have been designated by the
Borrower in writing to the Administrative Agent in the applicable borrowing request. Each Lend- er at its option may make any Eurocurrency Loan by causing any
domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of the Borrower
to repay such Loan in accordance with the terms.
(b)
Unless the Administrative Agent shall have received notice from a Lender prior to the proposed time of any Borrowing that such Lender will
not make available to the Administrative Agent such Lender’s share of such Borrowing, the Administrative Agent may assume that such Lender has made such
share available on such date in accordance with paragraph (a) of this Section and may, in reliance upon such assumption, make available to the Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share of the applicable Bor- rowing available to the Administrative Agent, then the
applicable Lender and the Borrower severally agree to pay to the Administrative Agent forthwith on demand such corresponding amount with interest thereon, for
each day from and including the date such amount is made available to the Borrower to but excluding the date of payment to the Administrative Agent, at (i) in the
case of such Lender, a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation in the relevant currency or
(ii) in the case of the Borrower, the interest rate applicable to such Loans in the case of a Loan in Dollars or the applicable Eurocurrency Rate in the case of a
Revolving Loan in an Alternative Currency. If such Lender pays such amount to the Administrative Agent, then such amount shall constitute such Lender’s Loan
included in such Borrowing.
(c)
The obligations of the Lenders hereunder to make Loans, to fund participations in Letters of Credit and to make payments pursuant to Sections
8.09 and 9.04(c) are several and not joint. The failure of any Lender to make any Loan or to fund any such participation or to make any payment under Sections 8.09
or 9.04(c) on any date required hereunder shall not relieve any other Lender of its corresponding obligation to do so on such date, and, other than pursuant to Section
2.18, no Lender shall be responsible for the failure of any other Lender to so make its Loan or, to fund its participation or to make its payment under Sections 8.09 or
9.04(c).
SECTION 2.05 Interest Elections .
(a)
Each Borrowing denominated in Dollars initially shall be of the Type specified in the applicable borrowing request, and each Eurocurrency
Borrowing in Dollars or an Alternative Currency shall have an initial Interest Period as specified in such borrowing request. Thereafter, the Borrower may elect to
convert any Borrow- ing denominated in Dollars to a different Type or to continue such Borrowing as the same Type and may elect suc- cessive Interest Periods for
any Eurocurrency Borrowing in Dollars or, in the case of Revolving Loans, an Alterna- tive Currency, all as provided in this Section. The Borrower may elect
different Types or Interest Periods, as appli- cable, with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated
ratably among the relevant Lenders holding the Loans comprising the relevant portion of such Borrowing, and the Loans comprising each such portion shall be
considered a separate Borrowing.
(b)
To make an election pursuant to this Section, the Borrower shall notify the Administrative Agent of such election by telephone by the time that
a request for a Borrowing would be required under Section 2.03, if the Borrower were requesting a Borrowing of the Type resulting from such election to be made
on the effective date of
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such election. Each such telephonic Interest Election Request shall be irrevocable and shall be confirmed promptly in writing.
(c)
Each telephonic and written Interest Election Request shall specify (i) the Borrowing to which such Interest Election Request applies and, if
different options are being elected with respect to different portions thereof, the portions thereof to be allocated to each resulting Borrowing (in which case the
information to be speci- fied pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing), (ii) the effective date of the election made
pursuant to such Interest Election Request, which shall be a Business Day, (iii) in the case of a Borrowing denominated in Dollars, whether the resulting Borrowing
is to be an ABR Borrowing or a Eurocurrency Borrowing, and (iv) if the resulting Borrowing is a Eurocurrency Borrowing, the Interest Period to be applicable
thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Inter- est Period.” If any such Interest Election
Request requests a Eurocurrency Borrowing but does not specify an Inter- est Period, then the Borrower shall be deemed to have selected an Interest Period of one
month’s duration.
(d)
Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each relevant Lender of the details thereof
and of such Lender’s portion of each resulting Borrowing.
(e)
If the Borrower fails to deliver a timely Interest Election Request with respect to a Eurocurrency Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be continued as such for
an Interest Period of one month. Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing and the Administrative Agent,
at the request of the Required Lenders, so notifies the Borrower, then, so long as an Event of Default is continuing (i) no outstanding Borrowing in Dollars may be
converted to or continued as a Eurocurrency Borrowing and (ii) unless repaid, each Eurocurrency Borrowing denominated in Dollars shall be converted to an ABR
Borrowing at the end of the Interest Period applicable thereto and (iii) each Eurocurrency Borrowing in an Alternative Currency shall be continued as such for an
Interest Period of not more than one month.
SECTION 2.06 Termination and Reduction of Commitments . The Borrower shall have the right, upon not less than three Business Days’ notice to the
Administrative Agent, to terminate the Commitments of any Class or, from time to time, to reduce the amount of the Commitments of any Class; provided that no
such termination or reduction of Revolving Commitments shall be permitted if, after giving effect thereto and to any prepayments of the Revolving Loans made on
the effective date thereof, the Outstanding Revolving Credits would exceed the Total Revolving Commitments. Any such reduction shall be in an amount equal to an
integral multiple of $1,000,000 and not less than $5,000,000 and shall reduce permanently the Commitments of such Class then in effect.
SECTION 2.07 Repayment of Loans; Evidence of Debt .
(a)
Any Lender may request that Loans made by it be evidenced by a promissory note. In such event, the Borrower shall prepare, execute and
deliver to such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent. Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.05) be represented by one or more promissory notes in such form payable to the order of the payee named therein (or, if such
promissory note is a registered note, to such payee and its registered assigns).
(b)
(c)
The Borrower unconditionally promises to pay the then unpaid principal amount of each Revolving Loan on the Revolving Termination Date.
The Borrower shall repay principal of outstanding Term B-1 Loans on the last Business Day of each March, June, September and December of
each year (commencing on the applicable day of the first full fiscal quarter of the Borrower after the Term B-1 Effective Date) and on the Term B-1 Maturity Date,
in an aggregate principal amount of such Term B-1 Loans equal to (A) in the case of quarterly payments due prior to the Term B-1 Maturity Date, an amount equal
to 1.25% of the aggregate principal amount of such Term B-1 Loans incurred on the Term B-1 Effective Date, and (B) in the case of such payment due on the Term
B-1 Maturity Date, an amount equal to the then unpaid principal amount of such Term B-1 Loans outstanding.
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(d)
Each Lender shall maintain in accordance with its usual practice an account or accounts evidenc- ing the indebtedness of the Borrower to such
Lender resulting from each Loan made by such Lender, including the amounts of principal and interest payable and paid to such Lender from time to time hereunder.
The Administrative Agent shall maintain accounts in which it shall record (i) the amount of each Loan made hereunder, the currency and Type
(e)
thereof and the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the Borrower to
each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the relevant Lenders and each relevant
Lender’s share thereof.
(f)
The entries made in the accounts maintained pursuant to paragraph (c) or (d) of this Section shall be conclusive absent manifest error of the
existence and amounts of the obligations recorded therein; provided that the failure of any Lender or the Administrative Agent to maintain such accounts or any
error therein shall not in any manner affect the obligation of the Borrower to repay the Loans in accordance with the terms of this Agreement.
SECTION 2.08 Prepayments .
(a)
The Borrower may at any time and from time to time prepay Loans, in whole or in part, without premium or penalty (except as specifically
provided in the last sentence of this Section 2.08(a)), upon notice deliv- ered to the Administrative Agent no later than 12:00 noon, New York City time (or in the
case of an Alternative Currency, 11:00 a.m., London time), not less than three Business Days prior thereto, in the case of Eurocurrency Loans, no later than 12:00
noon, New York City time, on the date of such notice, in the case of ABR Loans, which notice shall specify the date and amount of prepayment and the Loans to be
prepaid; provided that, if a Eurocurrency Loan is prepaid on any day other than the last day of the Interest Period applicable thereto, the Borrower shall also pay any
amounts owing pursuant to Section 2.13. Each such notice may be conditioned on the occurrence of one or more events (it being understood that the Administrative
Agent and Lenders shall be entitled to assume that the Loans contemplated by such notice are to be made unless the Administrative Agent shall have received
written notice revoking such notice of prepayment on or prior to the date of such prepayment). Upon receipt of any such notice the Administrative Agent shall
promptly notify each relevant Lender thereof. If any such notice is given, the amount specified in such notice shall be due and payable on the date specified therein,
together with accrued interest to such date on the amount prepaid. Partial prepayments of Loans shall be in an aggregate principal amount that is an integral multiple
of $1,000,000 and not less than $5,000,000 (or comparable amounts determined by the Administrative Agent in the case of Alternative Currency). In the case of
each prepayment of Loans pursuant to this Section 2.08(a), the Borrower may in its sole discretion select the Loans (of any Class) to be repaid, and such prepayment
shall be paid to the appropriate Lenders in accordance with their respective pro rata share of such Loans. If any Repricing Event occurs prior to the date occurring 12
months after the Incremental Assumption Agreement No.1 Effective Date, the Borrower agrees to pay to the Administrative Agent, for the ratable account of each
Lender with Term B-1 Loans that are subject to such Repricing Event (including any Lender which is replaced pursuant to Sec- tion 2.16(c) as a result of its refusal
to consent to an amendment giving rise to such Repricing Event), a fee in an amount equal to 1.00% of the aggregate principal amount of the Term B-1 Loans
subject to such Repricing Event. Such fees shall be earned, due and payable upon the date of the occurrence of such Repricing Event.
(b)
If at any time for any reason the sum of the Dollar Amount of Outstanding Revolving Credit ex- ceeds the Total Revolving Commitments, the
Borrower shall upon learning thereof, or upon the request of the Ad- ministrative Agent, immediately prepay the Revolving Loans in an aggregate principal amount
at least equal to the amount of such excess; provided that solely with respect to any excess resulting from currency exchange rate fluctuations, this Section 2.08(b)
shall not apply unless, on the last day of any fiscal quarter of the Borrower, the Dollar Amount of Outstanding Revolving Credit exceeds the Total Revolving
Commitments by more than 2.5% as a result of such fluctuations.
(c)
Beginning on the Term B-1 Effective Date, the Borrower shall apply (1) all Net Proceeds (other than Net Proceeds of the kind described in the
following clause (2)) within five (5) Business Days after receipt thereof to prepay Term Loans in accordance with clauses (e) and (f) below; provided that no such
prepayment shall be required if, on a pro forma basis after giving effect to such Asset Sale or Recovery Event, the Secured Net Lever- age Ratio is less than 1.50 to
1.00 and (2) all Net Proceeds from any issuance or incurrence of Refinancing Term
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Loans and Replacement Revolving Facility Commitments (other than solely by means of extending or renewing then existing Refinancing Term Loans and
Replacement Revolving Facility Commitments without resulting in any Net Proceeds), no later than three (3) Business Days after the date on which such
Refinancing Term Loans and/or Replacement Revolving Facility Commitments are incurred, to prepay Term Loans and/or Revolving Commitments in accordance
with Section 2.20.
(d)
Not later than five (5) Business Days after the date on which the annual financial statements are, or are required to be, delivered under Section
5.01(a) with respect to each Excess Cash Flow Period, the Borrower shall calculate Excess Cash Flow for such Excess Cash Flow Period and, if and to the extent the
amount of such Excess Cash Flow is greater than $0, the Borrower shall apply an amount to prepay Term Loans equal to (i) the Re- quired Percentage of such
Excess Cash Flow minus (ii) the sum of (a) to the extent not financed using the proceeds of funded Indebtedness, the amount of any voluntary payments of Term
Loans and amounts used to repurchase out- standing principal of Term Loans during such Excess Cash Flow Period ( plus , without duplication of any amounts
previously deducted under this clause (ii), the amount of any such voluntary payments and amounts so used to re- purchase principal of Term Loans after the end of
such Excess Cash Flow Period but before the date of prepayment under this clause (d)) pursuant to Sections 2.08(a) and Section 2.21 (it being understood that the
amount of any such payments pursuant to Section 2.21 shall be calculated to equal the amount of cash used to repay principal and not the principal amount deemed
prepaid therewith) and (b) to the extent not financed using the proceeds of funded Indebtedness, the amount of any voluntary payments of Revolving Loans to the
extent that Revolving Commitments are terminated or reduced pursuant to Section 2.06 by the amount of such payments. Such calculation will be set forth in an
Officer’s Certificate delivered to the Administrative Agent setting forth the amount, if any, of Excess Cash Flow for such Excess Cash Flow Period, the amount of
any required prepayment in respect thereof and the calculation thereof in reasonable detail.
(e)
Amounts to be applied in connection with prepayments of Term Loans pursuant to this Section 2.08 shall be applied to the prepayment of the
Term Loans in accordance with Section 2.15(b) until paid in full. In connection with any mandatory prepayments by the Borrower of the Term Loans pursuant to this
Section 2.08, such prepayments shall be applied on a pro rata basis to the then outstanding Term Loans being prepaid irrespective of whether such outstanding Term
Loans are ABR Loans or Eurocurrency Loans; provided that with respect to such mandatory prepayment, the amount of such mandatory prepayment shall be applied
(i) first to Term Loans that are ABR Loans to the full extent thereof before application to Term Loans that are Eurocurrency Loans in a manner that minimizes the
amount of any payments required to be made by the Borrower pursuant to Section 2.13 and (ii) on a pro rata basis with respect to each Class of Term Loans except to
the extent any Incremental Assumption Agreement, Extension Amendment or Refinancing Amendment provides that the Class of Term Loans incurred thereunder is
to receive less than its pro rata share, in which case such prepayment shall be allocated to such Class of Term Loans as set forth in such Incremental Assumption
Agreement, Extension Amendment or Refinancing Amendment and to the other Classes of Term Loans on a pro rata basis. Each prepayment of the Term Loans
under this Section 2.08 shall be accompanied by accrued interest to the date of such prepayment on the amount prepaid.
(f)
The Borrower shall notify the Administrative Agent in writing of any mandatory prepayment of Term Loans required to be made pursuant to
Section 2.08(c)(1) or 2.08(d) at least four (4) Business Days prior to the date of such prepayment. Each such notice shall specify the date of such prepayment and
provide a reasonably de- tailed calculation of the amount of such prepayment. The Administrative Agent will promptly notify each Term Lender of the contents of
any such prepayment notice and of such Term Lender’s ratable portion of such prepay- ment (based on such Lender’s pro rata share of each relevant Class of the
Term Loans). Any Term Lender (a “ De - clining Term Lender ,” and any Term Lender which is not a Declining Term Lender, an “ Accepting Term L ender”) may
elect, by delivering written notice to the Administrative Agent and the Borrower no later than 5:00 p.m. one (1) Business Day after the date of such Term Lender’s
receipt of notice from the Administrative Agent regarding such prepayment, that the full amount of any mandatory prepayment otherwise required to be made with
respect to the Term Loans held by such Term Lender pursuant to Section 2.08(c)(1) or 2.08(d) not be made (the aggregate amount of such prepayments declined by
the Declining Term Lenders, the “ Declined Prepayment Amo unt”). If a Term Lender fails to deliver notice setting forth such rejection of a prepayment to the
Administrative Agent within the time frame specified above or such notice fails to specify the principal amount of the Term Loans to be rejected, any such failure
will be deemed an acceptance of the total amount of such mandatory prepayment of Term Loans. In the event that the Declined Prepayment Amount is greater than
$0, the Administrative Agent will promptly notify each
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Accepting Term Lender of the amount of such Declined Prepayment Amount and of any such Accepting Term Lender’s ratable portion of such Declined
Prepayment Amount (based on such Lender’s pro rata share of the Term Loans (excluding the pro rata share of Declining Term Lenders)). Any such Accepting
Term Lender may elect, by delivering, no later than 5:00 p.m. one (1) Business Day after the date of such Accepting Term Lender’s receipt of notice from the
Administrative Agent regarding such additional prepayment, a written notice, that such Accepting Term Lender’s ratable portion of such Declined Prepayment
Amount not be applied to repay such Accepting Term Lender’s Term Loans, in which case the portion of such Declined Prepayment Amount which would otherwise
have been applied to such Term Loans of the Declining Term Lenders shall instead be retained by the Borrower. Each Term Lender’s ratable portion of such
Declined Prepayment Amount (unless declined by the respective Term Lend- er as described in the preceding sentence) shall be applied to the respective Term
Loans of such Lenders. For the avoidance of doubt, the Borrower may, at its option, apply any amounts retained in accordance with the immediately preceding
sentence to prepay loans in accordance with Section 2.08(a).
(g)
Any prepayment of Term Loans of any Class shall be applied (i) in the case of prepayments made pursuant to Section 2.08(a), to reduce the
subsequent scheduled repayments of the Term Loans of such Class to be made pursuant to Section 2.07 as directed by the Borrower, or as otherwise provided in any
Extension Amendment, any Incremental Assumption Amendment or Refinancing Amendment, and (ii) in the case of prepayments made pursuant to Section 2.08(c)
or Section 2.08(d), to reduce the subsequent scheduled repayments of the Term Loans of such Class to be made pursuant to this Section in direct order of maturity,
or as otherwise provided in any Extension Amendment, any Incremental Assumption Amendment or Refinancing Amendment.
SECTION 2.09 Fees .
(a)
The Borrower agrees to pay to the Administrative Agent for the account of each Revolving Lender a commitment fee in Dollars for the period
from and including the Closing Date to the last day of the Revolving Commitment Period, computed at the applicable Commitment Fee Rate on the average daily
Dollar Amount of the Available Revolving Commitment of such Lender during the period for which payment is made, payable quarterly in arrears on each
Revolving Fee Payment Date, commencing on December 31, 2015.
(b)
The Borrower agrees to pay (i) to the Administrative Agent for the account of each Revolving Lender a participation fee with respect to its
participations in Letters of Credit, which shall accrue at the same Ap- plicable Rate used to determine the interest rate applicable to Eurocurrency Loans on the
average daily Dollar Amount of such Revolving Lender’s LC Exposure (excluding any portion thereof attributable to unreimbursed LC Disbursements) during the
period from and including the Closing Date to but excluding the later of the date on which such Revolving Lender’s Revolving Commitment terminates and the date
on which such Revolving Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a fronting fee, which shall accrue at the rate of 0.125
% per annum on the average daily Dollar Amount of the LC Exposure of the Letters of Credit issued by it (exclud- ing any portion thereof attributable to
unreimbursed LC Disbursements) during the period from and including the Closing Date to but excluding the later of the date of termination of the Revolving
Commitments and the date on which there ceases to be any such LC Exposure, as well as the fees agreed by the Issuing Bank and the Borrower with respect to the
issuance, amendment, renewal or extension of any Letter of Credit or processing of drawings thereunder. Participation fees and fronting fees will be payable in
Dollars quarterly in arrears on each Revolving Fee Payment Date, commencing on December 31, 2015; provided that any such fees accruing after the date on which
the Revolving Commitments terminate shall be payable on demand. Any other fees payable to the Issuing Bank pursuant to this paragraph shall be payable within 10
days after demand. All participation fees and fronting fees shall be computed on the basis of a year of 365/366 days and shall be payable for the actual number of
days elapsed (including the first day but excluding the last day).
(c)
The Borrower agrees to pay to the Administrative Agent the fees in the amounts and on the dates as set forth in any fee agreements with the
Administrative Agent and to perform any other obligations contained therein.
(d)
All fees payable hereunder shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution, in the
case of commitment fees, to the Revolving Lenders. Fees paid shall not
53
be refundable under any circumstances. All per annum fees shall be computed on the basis of a year of 365/366 days for actual days elapsed; provided that
commitment fees shall be computed on the basis of a year of 360 days.
SECTION 2.10 Interest .
(a)
(b)
The Loans comprising each ABR Borrowing shall bear interest at the Alternate Base Rate plus the Applicable Rate.
The Loans comprising each Eurocurrency Borrowing in any currency shall bear interest at the Eurocurrency Rate for such currency for the
Interest Period in effect for such Borrowing plus the Applicable Rate.
(c)
Notwithstanding the foregoing, if any principal of or interest on any Loan or any fee or other amount payable by the Borrower hereunder is not
paid when due, whether at stated maturity, upon acceleration or otherwise, such overdue amount shall bear interest, after as well as before judgment, at a rate per
annum equal to (i) in the case of overdue principal of any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this
Section or (ii) in the case of any other amount, 2% plus the rate applicable to ABR Loans as provided in paragraph (a) of this Section (in the case of such other
amount in Dollars) or 2% plus the daily weighted average rate of all Loans in the relevant Alternative Currency (in the case of any such other amount in such
Alternative Currency).
(d)
Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan and, in addition, in the case of
Revolving Loans, upon termination of the Revolving Commitments; provided that (i) interest accrued pursuant to paragraph (c) of this Section shall be payable on
demand, (ii) in the event of any repayment or prepayment of any Loan, accrued interest on the principal amount repaid or prepaid shall be payable on the date of
such repayment or prepayment and (iii) in the event of any conversion of any Eurocurrency Loan pri- or to the end of the current Interest Period therefor, accrued
interest on such Loan shall be payable on the effective date of such conversion.
(e)
All interest hereunder shall be computed on the basis of a year of 360 days, except that (i) (A) in- terest computed by reference to the Alternate
Base Rate at times when the Alternate Base Rate is based on the Prime Rate and (B) interest computed by reference to the Australian Dollar Bank Bill Reference
Rate and the CDOR Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year) and (ii) interest in respect of Borrowings in Sterling shall
be computed on the basis of 365 days, and in each case of the foregoing clauses (i) and (ii) shall be payable for the actual number of days elapsed (including the first
day but excluding the last day). The applicable Alternate Base Rate or Eurocurrency Rate shall be determined by the Administrative Agent, and such determination
shall be conclusive absent manifest error.
SECTION 2.11 Alternate Rate of Interest .
(a)
If at the time that the Administrative Agent shall seek to determine the Reference Bank Rate less than two Reference Banks shall supply a rate
to the Administrative Agent for purposes of determining the Eurocur- rency Rate for such Eurocurrency Borrowing, then (a) the Borrower and the Administrative
Agent may mutually agree in their reasonable discretion to appoint one or more additional Reference Banks (subject to consent by such Reference Bank(s)) for
purposes of establishing the Reference Bank Rate that shall be the Eurocurrency Rate for such Interest Period for such Eurocurrency Borrowing, or (b) if no
additional Reference Banks are so appointed or if additional Reference Banks are so appointed and less than two Reference Banks supply such a rate, then the
Administrative Agent shall be deemed to have determined that adequate and reasonable means do not exist for ascertaining the Eurocurrency Rate for such
Eurocurrency Borrowing and Section 2.11(b)(i) shall apply.
(b)
If prior to the commencement of any Interest Period for a Eurocurrency Borrowing:
(i)
the Administrative Agent determines (which determination shall be conclusive and bind- ing absent manifest error) that adequate and
reasonable means do not exist for ascertaining the Eurocurren- cy Rate for a Loan in the applicable currency or for the applicable Interest Period; or
54
(ii)
the Administrative Agent is advised by the Required Lenders that the Eurocurrency Rate for a Loan in the applicable currency or for
the applicable Interest Period will not adequately and fairly re- flect the cost to such Lenders (or Lender) of making or maintaining their Loans (or its Loan)
included in such Borrowing for such Interest Period;
then the Administrative Agent shall give notice thereof to the Borrower and the Lenders by telephone or telecopy as promptly as practicable thereafter and, until the
Administrative Agent notifies the Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Interest Election Request that
requests the conver- sion of any Borrowing in Dollars to, or continuation of any Borrowing in Dollars as, a Eurocurrency Borrowing shall be ineffective and the
Loans shall be converted to an ABR Borrowing and (ii) if any borrowing request re- quests a Eurocurrency Borrowing, such Borrowing, if denominated in Dollars,
shall be made as an ABR Borrowing, and if such borrowing request requests a Borrowing denominated in an Alternative Currency or if any Interest Elec- tion
Request requests the continuation of a Eurocurrency Borrowing in an Alternative Currency, such Borrowing or continuation shall be made or continued as a
Borrowing bearing interest at an interest rate reasonably determined by the Administrative Agent, after consultation with the Borrower and the applicable Lenders,
to compensate the applicable Lenders for such Borrowing in such currency for the applicable period plus the Applicable Rate; provided that if the circumstances
giving rise to such notice affect only Borrowings in one currency, then Borrowings in other currencies will not be affected by the provisions of this Section.
SECTION 2.12 Increased Costs .
(a)
If any Change in Law shall:
(i)
impose, modify or deem applicable any reserve, special deposit, compulsory loan, insur- ance charge or similar requirement against
assets of, deposits with or for the account of, or credit extended by, any Lender (including any reserve for eurocurrency funding that may be established or
reestablished under Regulation D of the Board);
(ii)
impose on any Lender any Taxes other than (A) Indemnified Taxes or Other Taxes in- demnified under Section 2.14 or (B) Excluded
Taxes; or
(iii)
such Lender;
impose on any Lender or the London interbank market any other condition affecting this Agreement or Eurocurrency Loans made by
and the result of any of the foregoing shall be to increase the cost to such Lender of making, continuing, converting into or maintaining any Eurocurrency Loan (or
of maintaining its obligation to make any such Loan) or to increase the cost to such Lender or Issuing Bank of participating in, issuing or maintaining any Letter of
Credit or to reduce the amount of any sum received or receivable by such Lender hereunder (whether of principal, interest or other- wise), then the Borrower will
pay to such Lender such additional amount or amounts as will compensate such Lend- er for such additional costs incurred or reduction suffered.
(b)
If any Lender determines that any Change in Law regarding capital or liquidity 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 or the Loans made by such
Lender 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 capital adequacy), then from time to time 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)
A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lend- er or its holding company, as the case may
be, as specified in paragraph (a) or (b) of this Section shall be delivered to the Borrower and shall be conclusive absent manifest error. The Borrower shall pay such
Lender the amount shown as due on any such certificate within 10 days after receipt thereof.
55
(d)
Failure or delay on the part of any Lender to demand compensation pursuant to this Section 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 this Section for any increased costs or
reductions incurred more than 180 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; provided further 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.
SECTION 2.13 Break Funding Payments . In the event of (a) the payment of any principal of any Euro- currency Loan other than on the last day of an
Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurocurrency Loan other than on the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Eurocurrency Loan on the date specified in any notice delivered pursuant hereto
or (d) the assignment of any Eurocurrency Loan other than on the last day of the Interest Period applicable thereto as a result of a request by the Borrower pursuant
to Section 2.16, then, in any such event, the Borrower shall compensate each Lender for the loss, cost and expense attributable to such event. In the case of a
Eurocurrency Loan, such loss, cost or expense to any Lender shall be deemed to be an amount determined by such Lender to be the excess, if any, of (i) the amount
of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Eurocurrency Rate that would have been applicable
to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or
continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for
such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for deposits in the relevant currency of a
comparable amount and period from other banks in the eurocurrency market (but not less than the available Eurocurrency rate quoted for the Eurocurrency interest
period equal to the period from the date of such event to the last day of the then current Interest Period, or if there is no such Eurocurrency interest period, the lower
of the Eurocurrency rates quoted for the closest Eurocurrency interest periods that are longer and shorter than such period). A certificate of any Lender setting forth
any amount or amounts that such Lender is entitled to receive pur- suant to this Section shall be delivered to the Borrower and shall be conclusive absent manifest
error. The Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.
SECTION 2.14 Taxes .
(a)
All payments by or on account of any obligation of any Loan Party hereunder or under any other Loan Document shall be made free and clear
of and without deduction for any Taxes unless required by applicable Requirements of Law; provided that if any applicable withholding agent shall be required by
applicable Require- ments of Law to deduct any Taxes in respect of any such payments, then (i) if such Tax is an Indemnified Tax or Other Tax, the sum payable
shall be increased by the applicable Loan Party as necessary so that after all required deductions (including deductions applicable to additional sums payable under
this Section 2.14) have been made the applicable Lender (or, in the case of a payment made to the Administrative Agent for its own account, the Administrative
Agent) receives an amount equal to the sum it would have received had no such deductions been made, (ii) the applicable withholding agent shall make such
deductions and (iii) the applicable withholding agent shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable
Requirements of Law.
(b)
In addition, without duplication of any obligation set forth in subsection (a), the Borrower shall pay any Other Taxes to the relevant
Governmental Authority in accordance with applicable Requirements of Law.
(c)
Without duplication of any obligation set forth in subsection (a), the Loan Parties shall indemnify the Administrative Agent and each Lender,
within 10 days after written demand therefor, for the full amount of any Indemnified Taxes paid by the Administrative Agent or such Lender, as the case may be, on
or with respect to any payment by or on account of any obligation of any Loan Party hereunder or under any other Loan Document and any Other Taxes paid by the
Administrative Agent or such Lender (including Indemnified Taxes or Other Taxes imposed on asserted on or attributable to amounts payable under this Section
2.14) and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other 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 the Borrower by a Lender, or by
the Administrative Agent on its own behalf or on behalf of a
56
Lender, shall be conclusive absent manifest error. If the Borrower determines that there is a reasonable basis to con- test any Indemnified Tax or Other Tax for
which it is responsible hereunder, without limiting Borrower’s indemnifi- cation obligations hereunder, such Administrative Agent or Lender (as applicable) shall
reasonably cooperate in pursuing such contest (at Borrower’s expense) so long as pursuing such contest would not, in the sole reasonable determination of the
Administrative Agent or Lender, result in any additional unreimbursed costs or expenses or be otherwise disadvantageous to the Administrative Agent or such
Lender. This Section shall not be construed to re- quire the Administrative Agent or Lender to make available its tax returns (or any other information relating to its
Taxes which it deems confidential) to the Borrower or any other Person.
(d)
As soon as practicable after any payment of Indemnified Taxes or Other Taxes by any Loan Party to a Governmental Authority, the Borrower
shall deliver to the Administrative Agent a copy, or if reasonably availa- ble to the Borrower a certified copy, of a receipt issued by such Governmental Authority
evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Ad- ministrative Agent.
(e)
(i)Each Lender shall deliver to the Borrower and the Administrative Agent, at the time or times reasonably requested by the Borrower or the
Administrative Agent, such properly completed and executed docu- mentation reasonably requested by the Borrower or the Administrative Agent as will permit such
payments to be made without withholding Tax or at a reduced rate of withholding.
(ii)
Without limiting the generality of the foregoing,
(A)
any U.S. Lender shall deliver to the Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a
Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), properly
executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding Tax;
(B)
any Non-U.S. Lender shall, to the extent it is legally eligible to do so, deliver to the Bor- rower and the Administrative Agent on or
prior to the date on which such Foreign Lender becomes a Lend- er under this Agreement (and from time to time thereafter upon the reasonable request of
the Borrower or the Administrative Agent), whichever of the following is applicable to establish such Non-U.S. Lender’s entitlement to a reduced rate of,
or exemption from, withholding:
(1)
two properly executed originals of IRS Form W-8BEN or W-8BEN-E establish- ing an exemption from, or reduction of,
U.S. federal withholding Tax pursuant to an income tax treaty to which the United States is a party;
(2)
(3)
two properly executed originals of IRS Form W-8ECI;
(x) executed originals of a certificate substantially in the form of Exhibit G-1 to the effect that such Non-U.S. Lender is not
(A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of
Section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code, and that no payments to
be received by such Lender will be effectively connected income (a “ U.S. Tax Compliance Certificate ”) and (y) two properly executed originals
of IRS Form W-8BEN or W-8BEN-E; or
(4)
to the extent a Lender is not the beneficial owner (for example, where the Lend- er is a partnership, or has sold a
participation), two properly executed originals of IRS Form
W-8IMY, accompanied by properly executed IRS Form W-8ECI, IRS Form W-8BEN or W- 8BEN-E, a U.S. Tax Compliance Certificate
substantially in the form of Exhibit G-2 or Exhibit G- 3 , IRS Form W-9, and/or other certification documents from each beneficial owner, as
applicable; provided that if the Non-U.S. Lender is a partnership (and not a participating Lender), and one or more direct or indirect partners of
such Non-U.S. Lender are claiming the portfolio interest ex-
57
emption, such Non-U.S. Lender may provide a U.S. Tax Compliance Certificate substantially in the form of Exhibit G-4 on behalf of such direct
and indirect partner(s); and
(5)
any Non-U.S. Lender shall, to the extent it is legally eligible to do so, deliver to the Borrower and the Administrative Agent
(in such number of copies as shall be requested by the recipient) on or prior to the date on which such Non-U.S. Lender becomes a Lender under
this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Administrative Agent), executed originals of
any other form prescribed by applicable Require- ments of 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 or the Administrative Agent to determine the withholding or deduction required to be made.
(iii)
If a payment made to a Lender under this Agreement or the other Loan Documents would be sub- ject to U.S. Federal withholding 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 applica- ble), such Lender shall deliver to the Borrower or 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 pre- scribed by applicable Requirements of 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
neces- sary for the Borrower or the Administrative Agent to comply with its obligations under FATCA, to determine whether such Lender has or has not complied
with such Lender's obligations under FATCA and, as necessary, to determine the amount, if any, to deduct and withhold from such payment. Solely for purposes of
this Section 2.14(e)(iii), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.
(iv)
Each Lender agrees that if any documentation it previously delivered pursuant to this Section 2.14(e) expires or becomes obsolete or
inaccurate in any respect, it shall update such documentation or promptly notify the Borrower and the Administrative Agent in writing of its legal ineligibility to do
so.
(v)
Each Lender hereby authorizes the Administrative Agent to deliver to the Loan Parties and to any successor Administrative Agent any
documentation provided by such Lender to the Administrative Agent pursuant to this Section 2.14(e) .
(f)
If the Administrative Agent or a Lender determines, in its reasonable discretion, that it has re- ceived a refund of any Taxes or Other Taxes as
to which it has been indemnified by a Loan Party or with respect to which the Loan Party has paid additional amounts pursuant to this Section 2.14, it shall pay over
such refund to the Loan Party (but only to the extent of indemnity payments made, or additional amounts paid, by the Loan Party under this Section 2.14 with
respect to the Taxes or Other Taxes giving rise to such refund), net of all reasonable out-of- pocket expenses (including any Taxes) of the Administrative Agent or
such Lender and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that the Loan Party
agrees to repay the amount paid over to the Loan Party (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the
Administrative Agent or such Lender in the event the Administrative Agent or such Lender is required to repay such refund to such Governmental Authority. This
Section shall not be construed to require the Administrative Agent or any Lender to make available its tax returns (or any other information relating to its Taxes
which it deems confidential) to the Borrower or any other Person.
SECTION 2.15 Pro Rata Treatment and Payments .
(a)
Each borrowing of Revolving Loans by the Borrower from the Revolving Lenders and any reduction of the Revolving Commitments of the
Revolving Lenders shall be made pro rata according to the respective Revolving Commitments then held by the Revolving Lenders. Each payment by the Borrower
on account of any commitment fee or any letter of credit fee shall be paid ratably to the Revolving Lenders entitled thereto.
(b)
Each prepayment by the Borrower on account of principal of any Loans of any Class shall be made pro rata according to the respective
outstanding principal amounts of Loans of such Class then held by the
58
Lenders entitled to such payment (subject in the case of Term B-1 Loans to Section 2.08(f)). All repayments of principal of any Loans at stated maturity or upon
acceleration shall be allocated pro rata according to the respective outstanding principal amounts of the matured or accelerated Loans then held by the relevant
Lenders. All payments of interest in respect of any Loans shall be allocated pro rata according to the outstanding interest payable then owed to the relevant Lenders.
Notwithstanding the foregoing, (A) any amount payable to a Defaulting Lender under this Agreement (whether on account of principal, interest, fees or otherwise
but excluding any amount that would other- wise be payable to such Defaulting Lender pursuant to Section 2.16 and Section 9.05) shall, in lieu of being distributed
to such Defaulting Lender, be retained by the Administrative Agent in a segregated interest-bearing account and, subject to any applicable Requirements of Law, be
applied at such time or times as may be determined by the Administrative Agent: (1) first, to the payment of any amounts owing by such Defaulting Lender to the
Administrative Agent and the Issuing Bank hereunder (including amounts owed under Section 2.09(b) or 9.04(c)), (2) second, to the funding of any Loan or LC
Disbursement required by this Agreement, as determined by the Administrative Agent, (3) third, if so determined by the Administrative Agent and Borrower, held in
such account as cash collateral for future funding obligations of the Defaulting Lender under this Agreement, (4) fourth, pro rata, to the payment of any amounts
owing to the Borrower or the Lenders as a result of such Defaulting Lender’s breach of its obligations under this Agreement and (5) fifth, to such Defaulting Lender
or as otherwise directed by a court of competent jurisdiction, and (B) if such payment is a prepayment of the principal amount of Loans, such payment shall be
applied solely to prepay the Loans of all Non-Defaulting Lenders pro rata (based on the amounts owing to each) prior to being applied to the prepayment of any
Loan of any Defaulting Lender.
(c)
All payments (including prepayments) to be made by the Borrower hereunder, whether on account of principal, interest, fees or otherwise,
shall be made without setoff or counterclaim and shall be made prior to 2:00 p.m., New York City time (or as specified in the next sentence in the case of Loans in
an Alternative Currency), on the date when due. Except as otherwise expressly provided herein, all payments by the Borrower hereunder with respect to principal
and interest on Loans in an Alternative Currency shall be made on the dates specified herein for the pro rata account of the relevant Lenders to which such payment
is owed, in such Alternative Currency and in immediately available funds not later than the Applicable Time specified by the Administrative Agent to the Bor- rower
by the same time at least one Business Day prior to the date when due. All payments received by the Administrative Agent (i) after 2:00 p.m., New York City time,
in the case of payments in Dollars, or (ii) after the Applicable Time specified by the Administrative Agent in the case of payments in an Alternative Currency, may,
in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest and fees
thereon. All such payments shall be made to the Administrative Agent at its offices at 500 Stanton Christiana Road, Ops Building 2, 3 rd Floor, Newark, Delaware
except that payments pursuant to Sections 2.12, 2.13, 2.14 and 9.04 shall be made directly to the Persons entitled thereto. The Administrative Agent shall distribute
such payments to the relevant Lenders promptly upon receipt in like funds as received. If any payment hereunder becomes due and payable on a day other than a
Business Day, such payment shall be extended to the next succeeding Business Day. In the case of any extension of any payment of principal, interest thereon shall
be payable at the then applicable rate during such extension.
(d)
If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, interest and
fees then due hereunder, such funds shall be applied (subject to the rights of the Administrative Agent to hold and apply amounts to be paid to a Defaulting Lender
in accordance with Section 2.15(b)) (i) first, towards payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with
the amounts of interest and fees then due to such parties, and (ii) second, towards payment of principal then due hereunder, ratably among the parties entitled thereto
in accordance with the amounts of principal then due to such parties. To the extent necessary, the Administrative Agent shall enter into foreign currency ex- change
transactions on customary terms to effect any such ratable payment and the payments made by the Administrative Agent following such transactions shall be
deemed to be payments made by or on behalf of the Borrower hereunder.
(e)
If any Lender shall, by exercising any right of set-off or counterclaim or otherwise, obtain pay- ment in respect of any principal of or interest
on any of its Loans or participations in LC Disbursements of a given Class resulting in such Lender receiving payment of a greater proportion of the aggregate
principal amount of its Loans and participations in LC Disbursements of such Class and accrued interest thereon than the proportion re- ceived by any other Lender,
then the Lender receiving such greater proportion shall purchase (for cash at face value)
59
participations in the Loans and participations in LC Disbursements of such Class of other Lenders to the extent nec- essary so that the benefit of all such payments
shall be shared by the Lenders ratably in accordance with the aggre- gate amount of principal of and accrued interest on their respective Loans and participations in
LC Disbursements of such Class; provided that (i) if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered,
such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest, and (ii) the provisions of this paragraph shall
not be construed to apply to any payment made by the Borrower or any other Loan Party pursuant to and in accordance with the express terms of this Agree- ment
and the other Loan Documents or 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.
SECTION 2.16 Mitigation Obligations; Replacement of Lenders .
(a)
If any Lender requests compensation under Section 2.12, or if 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 2.14, 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 2.12 or 2.14, as the case may be, in the future and (ii)
would not subject such Lender to any unreimbursed cost or expense and would not otherwise be disadvantageous to such Lender. The Borrower hereby agrees to pay
all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment. Each Lender may designate a different lending
office for funding or booking its Loans hereunder or assign its rights and obligations hereunder to another of its offices, branches or affiliates; provided that the
exercise of this option shall not affect the obligations of the Borrower to repay the Loan in accordance with the terms of this Agreement.
(b)
If any Lender requests compensation under Section 2.12, or if 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 2.14, or if any Lender is a Defaulting Lender, 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 accord- ance with and subject
to the restrictions contained in Section 9.05), all its interests, rights and obligations under this Agreement to an assignee that shall assume such obligations (which
assignee may be another Lender, if a Lender accepts such assignment); provided that (i) the Borrower shall have received the prior written consent of the
Administrative Agent (and if a Revolving Commitment is being assigned, the Issuing Bank), which consent shall not unreasonably be withheld, (ii) such Lender
shall have received payment of an amount equal to the outstanding principal of its Loans and participations in unreimbursed LC Disbursements, accrued interest
thereon, accrued fees and all other amounts payable to it hereunder, 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) and (iii) in the case of any such assignment resulting from a claim for compensation under Section 2.12 or payments
required to be made pursuant to Section 2.14, such assignment will result in a reduction in such compensation or payments. A Lender shall not be required to make
any such assignment and 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.
(c)
If any Lender (such Lender, a “ Non-Consenting Lender ”) has failed to consent to a proposed amendment, waiver, discharge or termination
which pursuant to the terms of Section 9.02 requires the consent of all of the Lenders affected and with respect to which the Required Lenders shall have granted
their consent, then the Borrower shall have the right (unless such Non-Consenting Lender grants such consent) to replace such Non- Consenting Lender by requiring
such Non-Consenting Lender to assign its Loans, and its Revolving Commitments hereunder to one or more assignees reasonably acceptable to the Administrative
Agent, provided that: (a) all amounts owing to such Non-Consenting Lender being replaced (other than principal and interest) shall be paid in full to such Non-
Consenting Lender concurrently with such assignment, and (b) the replacement Lender (each such Lender, a “ Replacement Lender ”) shall purchase the foregoing
by paying to such Non-Consenting Lender a price equal to the principal amount thereof plus accrued and unpaid interest thereon. In connection with any such
assign- ment the Borrower, Administrative Agent, such Non-Consenting Lender and the Replacement Lender shall other- wise comply with Section 9.05.
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(d)
Notwithstanding anything herein to the contrary, each party hereto agrees that any assignment pursuant to the terms of Section 2.16(c) may be
effected pursuant to an Assignment and Assumption executed by the Borrower, the Administrative Agent and the assignee and that the Lender making such
assignment need not be a party thereto.
SECTION 2.17 Letters of Credit .
(a)
General . Subject to the terms and conditions set forth herein, the Borrower may request that standby letters of credit denominated in Dollars or
an Alternative Currency be issued under this Agreement for its own account or the account of any Restricted Subsidiary, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time during the Revolving Commitment Period. In the event of any inconsistency between
the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by the Borrower to,
or entered into by the Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control.
(b)
Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions . To request the issu- ance of a Letter of Credit (or the amendment,
renewal or extension of an outstanding Letter of Credit), the Borrower shall hand deliver or telecopy (or transmit by electronic communication, if arrangements for
doing so have been approved by the Issuing Bank) to the Issuing Bank and the Administrative Agent (reasonably in advance of the re- quested date of issuance,
amendment, renewal or extension, but in any event no later than two Business Days prior to such date unless otherwise agreed by the Issuing Bank and the
Administrative Agent) a notice requesting the issu- ance of a Letter of Credit, or identifying the Letter of Credit to be amended, renewed or extended, and specifying
the date of issuance, amendment, renewal or extension (which shall be a Business Day), the date on which such Letter of Credit is to expire (which shall comply
with paragraph (c) of this Section), the amount and currency of such Let- ter of Credit, the name and address of the beneficiary thereof and such other information as
shall be necessary to prepare, amend, renew or extend such Letter of Credit. If requested by the Issuing Bank, the Borrower also shall submit a letter of credit
application on the Issuing Bank’s standard form in connection with any request for a Letter of Credit. A Letter of Credit shall be issued, amended, renewed or
extended only if, after giving effect to such issu- ance, amendment, renewal or extension (i) the LC Exposure shall not exceed $40,000,000, (ii) the Dollar Amount
of the total Outstanding Revolving Credits shall not exceed the Total Revolving Commitments and (iii) with respect to such Issuing Bank, the sum of the aggregate
face amount of Letters of Credit issued by such Issuing Bank, when aggregated with the outstanding Revolving Loans funded by such Issuing Bank, shall not exceed
its Revolving Commitment.If the Borrower so requests in any applicable letter of credit application, the Issuing Bank may, in its sole discretion, agree to issue a
Letter of Credit that has automatic extension provisions (each, an “ Auto-Extension Letter of Credit ”); provided that any such Auto-Extension Letter of Credit must
permit the Issuing Bank to prevent any such extension 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 “ Non-Extension 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 Issuing Bank, the Borrower shall not be required to make a specific request to the Issuing Bank
for any such extension. Once an Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized (but may not require) the Issuing
Bank to permit the extension of such Letter of Credit at any time to an expiry date not later than the Letter of Credit expiration date referenced in clause (c) below;
provided , however , that the Issuing Bank shall not permit any such extension if (A) the Issuing Bank has determined that it would not be permitted, or would have
no obligation, at such time to issue such Letter of Credit in its revised form (as extended) under the terms hereof, or (B) it has received notice (which may be by
telephone or in writing) on or before the day that is seven Business Days before the Non-Extension Notice Date (1) from the Administrative Agent that the Re-
quired Lenders have elected not to permit such extension or (2) from the Administrative Agent, any Lender or the Borrower that one or more of the applicable
conditions specified in Section 4.02 is not then satisfied, and in each such case directing the Issuing Bank not to permit such extension. The Issuing Bank shall not
be under any obligation to issue any Letter of Credit if: (A) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to
enjoin or restrain the Issuing Bank from issuing the Letter of Credit, or any Law applicable to the Issuing Bank or any request or directive (whether or not having the
force of law) from any Governmental Authority with jurisdiction over the Issuing Bank shall prohibit, or request that the Issuing Bank refrain from, the issuance of
letters of credit generally or the Letter of Credit in particular or shall impose upon the Issuing Bank with respect to the Letter of Credit any restriction, reserve or
capital requirement (for which the Issuing Bank is not oth-
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erwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the Issuing Bank any unre- imbursed loss, cost or expense which was not
applicable on the Closing Date and which the Issuing Bank in good faith deems material to it; (B) the issuance of the Letter of Credit would violate one or more
policies of the Issuing Bank applicable to letters of credit generally.
(c)
Expiration Date . Each Letter of Credit shall expire at or prior to the close of business on the earlier of (i) the date one year after the date of the
issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (ii) the date that is five Business
Days prior to the Revolving Termination Date.
(d)
Participations . By the issuance of a Letter of Credit (or an amendment to a Letter of Credit in- creasing the amount thereof) and without any
further action on the part of the Issuing Bank or the Revolving Lend- ers, the Issuing Bank hereby grants to each Revolving Lender, and each Revolving Lender
hereby acquires from the Issuing Bank, a participation in such Letter of Credit equal to such Revolving Lender’s Revolving Commitment Percentage of the
aggregate amount available to be drawn under such Letter of Credit. In consideration and in fur- therance of the foregoing, each Revolving Lender hereby absolutely
and unconditionally agrees to pay to the Ad- ministrative Agent, for the account of the Issuing Bank, such Revolving Lender’s Revolving Commitment Percent- age
of each LC Disbursement made by the Issuing Bank and not reimbursed by the Borrower on the date due as provided in paragraph (e) of this Section, or of any
reimbursement payment required to be refunded to the Borrower for any reason. Such payment by the Lenders shall be made (i) if the currency of the applicable LC
Disbursement or reimbursement payment shall be Dollars, then in the currency of such LC Disbursement and (ii) subject to clause (l) of this Section, if the currency
of the applicable LC Disbursement or reimbursement payment shall be an Alternative Currency, in Dollars in an amount equal to the Dollar Amount of such LC
Disbursement or reimbursement payment, calculated by the Administrative Agent using the Exchange Rate on the applicable LC Participation Calculation Date.
Each Revolving Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute and
unconditional and shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence
and continuance of a Default or reduction or termination of the Revolving Commitments, and that each such payment shall be made without any offset, abatement,
withholding or reduction whatsoever.
(e)
Reimbursement . If the Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, the Borrower shall reimburse such LC
Disbursement by paying to the Administrative Agent in the currency of such LC Disbursement an amount equal to such LC Disbursement not later than 12:00 noon,
New York City time, on the date that such LC Disbursement is made, if the Borrower shall have received notice of such LC Disbursement prior to 10:00 a.m., New
York City time, on such date, or, if such notice has not been received by the Borrower prior to such time on such date, then not later than 12:00 noon, New York
City time, on the Business Day immediately following the day that the Borrower receives such notice; provided that if such LC Disbursement is denominated in
Dollars and is not less than $1,000,000, the Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 that such
payment be financed with an ABR Revolving Borrowing in an equivalent amount and, to the extent so financed, the Borrower’s obligation to make such payment
shall be dis- charged and replaced by the resulting ABR Revolving Borrowing. If the Borrower fails to make such payment when due, (A) if such payment relates to
a Letter of Credit denominated in an Alternative Currency, automatically and no further action required, the obligations of the Borrower to reimburse the applicable
LC Disbursement shall be permanently converted into an obligation to reimburse the Dollar Amount, calculated using the Exchange Rate on the applicable LC
Participation Calculation Date, of such LC Disbursement and (B) in the case of each LC Dis- bursement, the Administrative Agent shall notify each Revolving
Lender of the applicable LC Disbursement, the payment then due from the Borrower in respect thereof and such Revolving Lender’s Revolving Commitment Per-
centage thereof. Promptly following receipt of such notice, each Revolving Lender shall pay to the Administrative Agent its Revolving Commitment Percentage of
the payment then due from the Borrower, in the same manner as provided in Section 2.04 with respect to Loans made by such Revolving Lender (and Section 2.04
shall apply, muta- tis mutandis , to such payment obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the Issuing Bank the
amounts so received by it from the Revolving Lenders. Promptly following receipt by the Administrative Agent of any payment from the Borrower pursuant to this
paragraph, the Administrative Agent shall distribute such payment to the Issuing Bank or, to the extent that Revolving Lenders have made payments pur- suant to
this paragraph to reimburse the Issuing Bank, then to such Revolving Lenders and the Issuing Bank as their
62
interests may appear. Any payment made by a Revolving Lender pursuant to this paragraph to reimburse the Issuing Bank for any LC Disbursement (other than the
funding of ABR Loans as contemplated above) shall not constitute a Loan and shall not relieve the Borrower of its obligation to reimburse such LC Disbursement. If
the Borrower’s reimbursement of, or obligation to reimburse, any amounts in any Alternative Currency would subject the Administrative Agent, the Issuing Bank or
any Revolving Lender to any stamp duty, ad valorem charge or similar Tax that would not be payable if such reimbursement were made or required to be made in
Dollars, such Revolving Borrower shall pay the amount of any such Tax requested by the Administrative Agent, the Issuing Bank or such Revolving Lender.
Obligations Absolut e. The Borrower’s obligation to reimburse LC Disbursements as provided in paragraph (e) of this Section shall be
(f)
absolute, unconditional and irrevocable, and shall be performed strictly in ac- cordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein, (ii) any draft or
other document presented under a Letter of Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being untrue or inaccurate in
any respect, (iii) payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that does not comply with the terms of such
Letter of Credit, or (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section,
constitute a legal or equitable discharge of, or provide a right of setoff against, the Borrower’s obligations hereunder; provided that, subject to the penultimate
sentence of this clause (f), reimbursement obligations of the Borrower with respect to a Letter of Credit may be subject to avoidance by the Borrower to the extent of
any direct damages (as opposed to consequential damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law)
suffered by the Borrower or any Restrict- ed Subsidiary that are caused by the Issuing Bank’s failure to exercise care when determining whether drafts and other
documents presented under a Letter of Credit comply with the terms thereof. Neither the Administrative Agent, the Revolving Lenders nor the Issuing Bank, nor any
of their Related Parties, shall have any liability or re- sponsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment
or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sen- tence), or any error, omission, interruption, loss
or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a
drawing there- under), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Bank; provided that
the foregoing shall not be construed to excuse the Issuing Bank from liability to the Borrower to the extent of any direct damages (as opposed to consequential
damages, claims in respect of which are hereby waived by the Borrower to the extent permitted by applicable law) suffered by the Borrower that are caused by the
Issuing Bank’s failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof. The
parties hereto expressly agree that, in the absence of gross negligence, bad faith or willful misconduct on the part of the Issuing Bank (as finally determined by a
court of com- petent jurisdiction), the Issuing Bank shall be deemed to have exercised care in each such determination. In further- ance of the foregoing and without
limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms
of a Letter of Credit, the Issuing Bank may, in its sole discretion, either accept and make payment upon such documents without responsibility for further
investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict
compliance with the terms of such Letter of Credit.
(g)
Disbursement Procedures . The Issuing Bank shall, promptly following its receipt thereof, exam- ine all documents purporting to represent a
demand for payment under a Letter of Credit. The Issuing Bank shall promptly notify the Administrative Agent and the Borrower by telephone (confirmed by
telecopy) of such demand for payment and whether the Issuing Bank has made or will make an LC Disbursement thereunder; provided that any delay in giving such
notice shall not relieve the Borrower of its obligation to reimburse the Issuing Bank and the Revolving Lenders with respect to any such LC Disbursement.
(h)
Interim Int erest. If the Issuing Bank shall make any LC Disbursement, then, unless the Borrower shall reimburse such LC Disbursement in
full on the date set forth in paragraph (e) of this Section 2.17, the unpaid amount thereof shall bear interest, for each day from and including the date such LC
Disbursement is required to be reimbursed to but excluding the date that the Borrower reimburses such LC Disbursement, at the rate per annum set forth in Section
2.10(c)(ii). Interest accrued pursuant to this paragraph shall be for the account of the Issuing Bank,
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except that interest accrued on and after the date of payment by any Revolving Lender pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall
be for the account of such Revolving Lender to the extent of such payment.
(i)
Replacement of the Issuing Ban k. The Issuing Bank may be replaced at any time by written agreement among the Borrower, the
Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank. The Administrative Agent shall notify the Revolving Lenders of any such
replacement of the Issuing Bank. At the time any such replacement shall become effective, the Borrower shall pay all unpaid fees accrued for the ac- count of the
replaced Issuing Bank pursuant to Section 2.09(b). From and after the effective date of any such re- placement, (i) the successor Issuing Bank shall have all the
rights and obligations of the 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 include such successor and any previous Issuing Bank, or such successor and all previous Issuing Banks, as the context shall require. After
the replacement of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto 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, but shall not be required to issue additional Letters of
Credit.
(j)
Additional Issuing Banks . From time to time, the Borrower may by notice to the Administrative Agent designate any Lender (in addition to the
initial Issuing Bank) which agrees (in its sole discretion) to act in such capacity and is reasonably satisfactory to the Administrative Agent as an Issuing Bank. Each
such additional Issuing Bank shall execute a counterpart of this Agreement upon the approval of the Administrative Agent (which approval shall not be
unreasonably withheld) and shall thereafter be an Issuing Bank hereunder for all purposes.
(k)
Cash Collateralization . If any Event of Default shall occur and be continuing, on the Business Day that the Borrower receives notice from the
Administrative Agent or Revolving Lenders with LC Exposure rep- resenting greater than 50% of the total LC Exposure demanding the deposit of cash collateral
pursuant to this para- graph, the Borrower shall deposit in an account with the Administrative Agent, in the name of the Administrative Agent and for the benefit of
the Revolving Lenders, an amount in Dollars equal to 102% of the LC Exposure as of such date plus any accrued and unpaid interest thereon; provided that (i)
amount payable in respect of any Letter of Credit or LC Disbursement shall be payable in the currency of such Letter of Credit or LC Disbursement, except that LC
Disbursements in an Alternative Currency in respect of which the Borrower’s reimbursement obligations have been converted in Dollars as provided in paragraph
(e) or (l) of this Section and interest accrued thereon shall be payable in Dollars, and (ii) the obligation to deposit such cash collateral shall become effective
immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the oc- currence of any Event of
Default with respect to the Borrower described in clause (h) or (i) of Article VII. Such deposit shall be held by the Administrative Agent as collateral for the
payment and performance of the obligations of the Borrower under this Agreement with respect to the Revolving Facility. The Administrative Agent shall have
exclusive dominion and control, including the exclusive right of withdrawal, over such account. Other than any interest earned on the investment of such deposits,
which investments shall be made at the option and sole discretion of the Administrative Agent and at the Borrower’s risk and expense, such deposits shall not bear
interest. Interest or profits, if any, on such investments shall accumulate in such account. Moneys in such account shall be applied by the Administrative Agent to
reimburse the Issuing Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of the
reimbursement obligations of the Borrower for the LC Exposure at such time or, if the maturity of the Loans has been accelerated (but subject to the consent of
Lenders with LC Exposure representing greater than 50% of the total LC Exposure), be applied to satisfy other obligations of the Borrower under this Agreement
with respect to the Revolving Facility. If the Borrower is required to provide an amount of cash collateral hereunder as a result of the occurrence 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.
(l)
Conversion . In the event that the Loans become immediately due and payable on any date pursu- ant to Section 7.01, all amounts (i) that the
Borrower are at the time or become thereafter required to reimburse or otherwise pay to the Administrative Agent in respect of LC Disbursements made under any
Letter of Credit denomi- nated in an Alternative Currency, (ii) that the Revolving Lenders are at the time or become thereafter required to pay to the Administrative
Agent (and the Administrative Agent is at the time or becomes thereafter required to distribute
64
to the Issuing Bank) pursuant to paragraph (e) of this Section in respect of unreimbursed LC Disbursements made under any Letter of Credit denominated in an
Alternative Currency and (iii) of each Revolving Lender’s participa- tion in any Letter of Credit denominated in an Alternative Currency under which an LC
Disbursement has been made shall, automatically and with no further action required, be converted into the Dollar Amount, calculated using the Exchange Rate on
such date (or in the case of any LC Disbursement made after such date, on the date such LC Disbursement is made), of such amounts. On and after such conversion,
all amounts accruing and owed to the Administrative Agent, the Issuing Bank or any Revolving Lender in respect of the obligations described in this para- graph
shall accrue and be payable in Dollars at the rates otherwise applicable hereunder.
(m)
Applicability of ISP; Limitation of Liability . Unless otherwise expressly agreed by the Issuing Bank and the Borrower when a Letter of
Credit is issued, the rules of the ISP shall apply to each standby Letter of Credit. Notwithstanding the foregoing, the Issuing Bank shall not be responsible to the
Borrower for, and the Issu- ing Bank’s rights and remedies against the Borrower shall not be impaired by, any action or inaction of the Issuing Bank required or
permitted under any law, order, or practice that is required or permitted to be applied to any Letter of Credit or this Agreement, including the Law or any order of a
jurisdiction where the Issuing Bank or the benefi- ciary is located, the practice stated in the ISP, or in the decisions, opinions, practice statements, or official
commen- tary of the ICC Banking Commission, the Bankers Association for Finance and Trade - International Financial Ser- vices Association (BAFT-IFSA), or
the Institute of International Banking Law & Practice, whether or not any Letter of Credit chooses such law or practice.
(n)
Conflict with Issuer Documents . In the event of any conflict between the terms hereof and the terms of any Letter of Credit or related
document, the terms hereof shall control.
SECTION 2.18 Defaulting Lenders . Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then
the following provisions shall apply for so long as such Lender is a Defaulting Lender:
(a)
(b)
Fees shall cease to accrue on the Available Revolving Commitment of such Defaulting Lender pursuant to Section 2.09(a).
The Commitments, Loans and Outstanding Revolving Credit of such Defaulting Lender shall not be included in determining whether
the Required Lenders or Required Revolving Lenders have taken or may take any action hereunder (including any consent to any amendment, waiver or
other modifi- cation pursuant to Section 9.02 or Section 9.03); provided that this Section 2.18(b) shall not apply to the vote of a Defaulting Lender in the
case of an amendment, waiver or other modification effecting (i) an in- crease or extension of such Defaulting Lender’s Revolving Commitment or (ii) the
reduction or excuse of principal amount of, or interest or fees payable on, such Defaulting Lender’s Loans or the postponement of the scheduled date of
payment of such principal amount, interest or fees to such Defaulting Lender.
(c)
If any Letters of Credit exist at the time such Lender becomes a Defaulting Lender then: (i)Such Defaulting Lender’s LC Exposure
shall be reallocated among the Non-Defaulting Revolving Lenders in accordance with their respective Revolving Commitment Percentages (but excluding
the Revolving Commitments of all the Defaulting Lenders from both the numerator and the denominator) but only to the extent (x) the sum of all the
Outstanding Revolving Credits owed to all Non-Defaulting Lenders does not exceed the total of all Non-Defaulting Lenders’ Available Revolving
Commitments, (y) the representations and warranties of each Loan Party set forth in the Loan Documents to which it is a party are true and correct at such
time, except to the extent that any such representation and warranty relates to an earlier date (in which case such representation and warranty shall be true
and correct as of such earlier date), and (z) no Default shall have oc- curred and be continuing at such time;
(ii)
If the reallocation described in clause (i) above cannot, or can only partially, be effect- ed, the Borrower shall, within two
Business Days following notice by the Administrative Agent, cash collateralize for the benefit of the Issuing Bank such Defaulting Lender’s LC
Exposure (after
65
giving effect to any partial reallocation pursuant to clause (i) above) for so long as any Letters of Credit are outstanding;
(iii)
If the Borrower cash collateralizes any portion of such Defaulting Lender’s LC Exposure pursuant clause (ii) above, the
Borrower shall not be required to pay any fees to such Defaulting Lender pursuant to Section 2.09(b) with respect to such Defaulting Lender’s LC
Exposure during the period such Defaulting Lender’s LC Exposure is cash collateralized by the Borrower;
(iv)
If LC Exposures of the Non-Defaulting Lenders are reallocated pursuant to clause (i) above, then the fees payable to the
Revolving Lenders pursuant to Section 2.09(a) and Section 2.09(b) shall be adjusted to reflect such Non-Defaulting Lenders’ LC Exposure as
reallo- cated; and
(v)
If any Defaulting Lender’s LC Exposure is neither cash collateralized nor reallocated pursuant to clauses (i) or (ii) above,
then, without prejudice to any rights or remedies of the Issuing Bank or any Revolving Lender hereunder, all letter of credit fees payable under
Sec-tion 2.09(b) with respect to such Defaulting Lender’s LC Exposure shall be payable to the Issuing Bank until such LC Exposure is cash
collateralized and/or reallocated.
(d)
So long as such Defaulting Lender is a Defaulting Lender, the Issuing Bank shall not be required to issue, amend or increase any
Letter of Credit, unless it is satisfied that the related LC Exposure will be 100% covered by the Available Revolving Commitments of the Non-Defaulting
Lenders and/or cash collateral will be provided by the Borrower in accordance with Section 2.18(c)(ii), and the participating interests in any such newly
issued or increased Letter of Credit shall be allocated among Non- Defaulting Lenders in a manner consistent with Section 2.18(c)(i) (and such Defaulting
Lender shall not participate therein).
The rights and remedies against a Defaulting Lender under this Agreement are in addition to other rights and reme- dies that Borrower may have against such
Defaulting Lender with respect to any funding default and that the Ad- ministrative Agent or any Lender may have against such Defaulting Lender with respect to
any funding default. In the event that the Administrative Agent, the Borrower and the Issuing Bank each agrees that a Defaulting Lender has adequately remedied all
matters that caused such Lender to be a Defaulting Lender, then the Total Revolving Expo- sure shall be readjusted to reflect the inclusion of such Lender’s
Available Revolving Commitment and on such date such Lender shall purchase at par such of the Revolving Loans of the other Lenders or take such other actions as
the Administrative Agent may determine to be necessary to cause such outstanding Revolving Loans and funded and unfunded participations in Letters of Credit to
be held on a pro rata basis by the Revolving Lenders (including such Lender) in accordance with their applicable percentages, whereupon such Lender will cease to
be a Defaulting Lender and will be a Non-Defaulting Lender and any applicable cash collateral shall be promptly returned to the Borrower and any LC Exposure of
such Lender reallocated pursuant to the requirements above shall be reallocated back to such 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 that, except to the extent otherwise
expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Non-Defaulting Lender will constitute a waiver or release of any claim of
any party hereunder arising from such Lender’s having been a Defaulting Lender.
SECTION 2.19 Extensions of Commitments .
(a)
Notwithstanding anything to the contrary in this Agreement, pursuant to one or more offers made from time to time by the Borrower to all
Lenders of any Class of Term Loans and/or Revolving Commitments on a pro rata basis (based, in the case of an offer to the Lenders under any Class of Term
Loans, on the aggregate out- standing Term Loans of such Class and, in the case of an offer to the Lenders under any Revolving Facility, on the aggregate
outstanding Revolving Commitments under such Revolving Facility, as applicable), and on the same terms to each such Lender (“ Pro Rata Extension Offers ”), the
Borrower is hereby permitted to consummate transactions with individual Lenders that agree to such transactions from time to time to extend the maturity date of
such
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Lender’s Loans and/or Commitments of such Class and to otherwise modify the terms of such Lender’s Loans and/or Commitments of such Class pursuant to the
terms of the relevant Pro Rata Extension Offer (including, with- out limitation, increasing the interest rate or fees payable in respect of such Lender’s Loans and/or
Commitments and/or modifying the amortization schedule in respect of such Lender’s Loans). For the avoidance of doubt, the reference to “on the same terms” in
the preceding sentence shall mean, (i) in the case of an offer to the Lenders under any Class of Term Loans, that all of the Term Loans of such Class are offered to
be extended for the same amount of time and that the interest rate changes and fees payable with respect to such extension are the same and (ii) in the case of an
offer to the Lenders under any Revolving Facility, that all of the Revolving Commitments of such Facility are offered to be extended for the same amount of time
and that the interest rate changes and fees payable with respect to such extension are the same. Any such extension (an “ Extension ”) agreed to between the
Borrower and any such Lender (an “ Extending Lender ”) will be established under this Agreement by implementing a Term Loan for such Lender if such Lender is
extending an existing Term Loan (such extended Term Loan, an “ Ex- tended Term Loan ”) or an Extended Revolving Commitment for such Lender if such Lender
is extending an existing Revolving Commitment (such extended Revolving Commitment, an “ Extended Revolving Commitment ,” and any Revolving Loan made
pursuant to such Extended Revolving Commitment, an “ Extended Revolving Loan ”). Each Pro Rata Extension Offer shall specify the date on which the Borrower
proposes that the Extended Term Loan shall be made or the proposed Extended Revolving Commitment shall become effective, which shall be a date not earlier than
five (5) Business Days after the date on which the Pro Rata Extension Offer is delivered to the Administrative Agent (or such shorter period agreed to by the
Administrative Agent in its reasonable discretion).
(b)
The Borrower and each Extending Lender shall execute and deliver to the Administrative Agent an amendment to this Agreement (an “
except as to interest rates, fees, any other pricing terms and final maturity (which shall be determined by the Borrower and set forth in the Pro Rata
Extension Amendment ”) and such other documentation as the Administrative Agent shall reasonably specify to evidence the Extended Term Loans and/or Extended
Revolving Commitments of such Extending Lender. Each Extension Amendment shall specify the terms of the applicable Extended Term Loans and/or Extended
Revolving Commitments; provided , that (i) except as to interest rates, fees and any other pricing terms, and amortization, final maturity date and participation in
prepayments and commitment reductions (which shall be determined by the Borrower and set forth in the Pro Rata Extension Offer), the Extended Term Loans shall,
subject to clauses (ii) and (iii) of this proviso, have (x) the same terms as the existing Class of Term Loans from which they are extended or (y) such other terms as
shall be reasonably satisfactory to the Administrative Agent,
(ii) the final maturity date of any Extended Term Loans shall be no earlier than the Latest Maturity Date in effect on the date of incurrence, (iii) the Weighted
Average Life to Maturity of any Extended Term Loans shall be no shorter than the remaining Weighted Average Life to Maturity of the Class of Term Loans to
which such offer relates,
(iv)
Extension Offer), any Extended Revolving Commitment shall have (x) the same terms as the existing Class of Revolving Commitments from which they are
extended or (y) have such other terms as shall be reasonably satisfactory to the Administrative Agent and, in respect of any other terms that would affect the rights or
duties of any Issuing Bank, such terms as shall be reasonably satisfactory to such Issuing Bank, any Extended Term Loans may participate on a pro rata basis or a
less than pro rata basis (but not a greater than pro rata basis) than the Term Loans in any mandatory prepayment thereunder and (vi) such Extended Term Loans shall
not have at any time (x) any financial maintenance covenants of a different type than the financial covenants set forth in Section 6.10, or any financial maintenance
covenants that are more restrictive than the financial covenants set forth in Section 6.10 or (y) negative covenants and/or default provisions that, taken as a whole,
are materially more restrictive than those applicable to the Revolving Facility as determined in good faith by the Borrower unless, in each case of clauses (x) and (y)
such terms (I) (if favorable to all then existing Lenders) are in consultation with the Administrative Agent, incorporated into this Agreement for the benefit of all
then existing Lenders (without further amendment requirements) for so long as any such Extended Term Loans are outstanding or (II) become applicable only after
the Revolving Facility shall have matured or been terminated. Upon the effectiveness of any Ex- tension Amendment, this Agreement shall be amended to the extent
(but only to the extent) necessary to reflect the existence and terms of the Extended Term Loans and/or Extended Revolving Commitments evidenced thereby as
provided for in Section 9.02(c). Any such deemed amendment may be memorialized in writing by the Administrative Agent with the Borrower’s consent (not to be
unreasonably withheld) and furnished to the other parties hereto. If provided in any Extension Amendment with respect to any Extended Revolving Commitments,
and with the con- sent of each Issuing Bank, participations in Letters of Credit shall be reallocated to lenders holding such Extended Revolving Commitments in the
manner specified in such Extension Amendment, including upon effectiveness of
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such Extended Revolving Commitment or upon or prior to the maturity date for any Class of Revolving Commit- ments.
(c)
Upon the effectiveness of any such Extension, the applicable Extending Lender’s Term Loan will be automatically designated an Extended
Term Loan and/or such Extending Lender’s Revolving Commitment will be automatically designated an Extended Revolving Commitment. For purposes of this
Agreement and the other Loan Documents, (i) if such Extending Lender is extending a Term Loan, such Extending Lender will be deemed to have a Term Loan
having the terms of such Extended Term Loan and (ii) if such Extending Lender is extending a Revolving Commitment, such Extending Lender will be deemed to
have a Revolving Commitment having the terms of such Extended Revolving Commitment.
(d)
Notwithstanding anything to the contrary set forth in this Agreement or any other Loan Document (including without limitation this Section
2.19), (i) the aggregate amount of Extended Term Loans and Extended Revolving Commitments will not be included in the calculation of clause (a) of the definition
of Incremental Amount, (ii) no Extended Term Loan or Extended Revolving Commitment is required to be in any minimum amount or any minimum increment, (iii)
any Extending Lender may extend all or any portion of its Term Loans and/or Revolving Commitment pursuant to one or more Pro Rata Extension Offers (subject to
applicable proration in the case of over participation) (including the extension of any Extended Term Loan and/or Extended Revolving Commitment), (iv) there shall
be no condition to any Extension of any Loan or Commitment at any time or from time to time other than notice to the Administrative Agent of such Extension and
the terms of the Extended Term Loan or Extended Revolving Commitment implemented thereby, (v) all Extended Term Loans, Extended Revolving Commitments
and all obligations in respect thereof shall be Obligations of the relevant Loan Parties under this Agreement and the other Loan Documents that rank equally and
ratably in right of security with all other Obliga- tions of the Class being extended, (iv) no Issuing Bank shall be obligated to issue Letters of Credit under such Ex-
tended Revolving Commitments unless it shall have consented thereto and (vii) there shall be no borrower (other than the Borrower) and no guarantors (other than
the Guarantors) in respect of any such Extended Term Loans or Extended Revolving Commitments.
(e)
Each Extension shall be consummated pursuant to procedures set forth in the associated Pro Rata Extension Offer; provided , that the
Borrower shall cooperate with the Administrative Agent prior to making any Pro Rata Extension Offer to establish reasonable procedures with respect to mechanical
provisions relating to such Ex- tension, including, without limitation, timing, rounding and other adjustments.
SECTION 2.20 Refinancing Amendments .
(a)
Notwithstanding anything to the contrary in this Agreement, the Borrower may by written notice to the Administrative Agent establish one or
more additional tranches of term loans under this Agreement (such loans, “ Refinancing Term Loans ”), all proceeds of which are used to refinance in whole or in
part any Class of Term Loans pursuant to Section 2.08(c). Each such notice shall specify the date (each, a “ Refinancing Effective Date ”) on which the Borrower
proposes that the Refinancing Term Loans shall be made, which shall be a date not earlier than five (5) Business Days after the date on which such notice is
delivered to the Administrative Agent (or such shorter period agreed to by the Administrative Agent in its sole discretion); provided , that:
(i)
before and after giving effect to the Borrowing of such Refinancing Term Loans on the Refinancing Effective Date each of the
conditions set forth in Section 4.02 shall be satisfied;
(ii)
(iii)
the final maturity date of the Refinancing Term Loans shall be no earlier than the maturi- ty date of the refinanced Term Loans;
the Weighted Average Life to Maturity of such Refinancing Term Loans shall be no shorter than the then-remaining Weighted
Average Life to Maturity of the refinanced Term Loans;
(iv)
the aggregate principal amount of the Refinancing Term Loans shall not exceed the out- standing principal amount of the refinanced
Term Loans plus amounts used to pay fees, premiums, costs and expenses (including original issue discount) and accrued interest associated therewith;
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(v)
all other terms applicable to such Refinancing Term Loans (other than provisions relating to original issue discount, upfront fees,
interest rates and any other pricing terms (optional prepayment or mandatory prepayment or redemption terms shall be as agreed between the Borrower and
the Lenders providing such Refinancing Term Loans) taken as a whole shall (as determined by the Borrower in good faith) be substantially similar to, or no
more restrictive to the Borrower and its Restricted Subsidiaries than, the terms, taken as a whole, applicable to the Term Loans being refinanced (except to
the extent such covenants and other terms apply solely to any period after the Latest Maturity Date or are otherwise reasonably acceptable to the
Administrative Agent);
(vi)
Term Loans;
(vii)
(viii)
there shall be no borrower (other than the Borrower) and no guarantors (other than the Guarantors) in respect of such Refinancing
Refinancing Term Loans shall not be secured by any asset of the Borrower and its subsidiaries other than the Collateral;
Refinancing Term Loans may participate on a pro rata basis or on a less than pro rata basis (but not on a greater than pro rata basis)
in any mandatory prepayments (other than as provided other- wise in the case of such prepayments pursuant to Section 2.08(c)) hereunder, as specified in
the applicable Refinancing Amendment; and
(ix)
Refinancing Term Loans shall not at any time have (x) any financial maintenance cove- nants of a different type than the financial
covenants set forth in Section 6.10, or any financial maintenance covenants that are more restrictive than the financial covenants set forth in Section 6.10 or
(y) negative covenants and/or default provisions that, taken as a whole, are materially more restrictive than those applicable to the Revolving Facility as
determined in good faith by the Borrower unless, in each case of clauses and (y) such terms (I) (if favorable to all then existing Lenders) are in consultation
with the Administrative Agent, incorporated into this Agreement for the benefit of all then existing Lenders (without further amendment requirements) for
so long as any such Refinancing Term Loans are outstanding or (II) become applicable only after the Revolving Facility shall have matured or been
terminated.
(b)
The Borrower may approach any Lender or any other person that would be a permitted assignee pursuant to Section 9.05 to provide all or a
portion of the Refinancing Term Loans; provided , that any Lender of- fered or approached to provide all or a portion of the Refinancing Term Loans may elect or
decline, in its sole dis- cretion, to provide a Refinancing Term Loan. Any Refinancing Term Loans made on any Refinancing Effective Date shall be designated an
additional Class of Term Loans for all purposes of this Agreement; provided , further , that any Refinancing Term Loans may, to the extent provided in the
applicable Refinancing Amendment governing such Refinancing Term Loans, be designated as an increase in any previously established Class of Term Loans made
to the Borrower.
(c)
Notwithstanding anything to the contrary in this Agreement, the Borrower may by written notice to the Administrative Agent establish one or
more additional Facilities (“ Replacement Revolving Facilities ”) providing for revolving commitments (“ Replacement Revolving Facility Commitments ” and the
revolving loans thereunder, “ Replacement Revolving Loans ”), which replace in whole or in part any Class of Revolving Commitments under this Agreement. Each
such notice shall specify the date (each, a “ Replacement Revolving Facility Effective Date ”) on which the Borrower proposes that the Replacement Revolving
Facility Commitments shall become effective, which shall be a date not less than five (5) Business Days after the date on which such notice is delivered to the
Administrative Agent (or such shorter period agreed to by the Administrative Agent in its reasonable discretion); provided , that:
(i) before and after giving effect to the establishment of such Replacement Revolving Facili- ty Commitments on the Replacement Revolving
Facility Effective Date, each of the conditions set forth in Section 4.02 shall be satisfied;
(ii) after giving effect to the establishment of any Replacement Revolving Facility Commit- ments and any concurrent reduction in the
aggregate amount of any other Revolving Commitments, the ag-
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gregate amount of Revolving Commitments shall not exceed the aggregate amount of the Revolving Com- mitments outstanding immediately prior to the
applicable Replacement Revolving Facility Effective Date plus amounts used to pay fees, premiums, costs and expenses (including original issue discount)
and ac- crued interest associated therewith;
(iii) no Replacement Revolving Facility Commitments shall have a final maturity date (or re- quire commitment reductions or amortizations)
prior to the Revolving Termination Date for the Revolving Commitments being replaced;
(iv) all other terms applicable to such Replacement Revolving Facility (other than provisions relating to (x) fees, interest rates and other pricing
terms and prepayment and commitment reduction and optional redemption terms which shall be as agreed between the Borrower and the Lenders providing
such Replacement Revolving Facility Commitments and (y) the amount of any letter of credit sublimit under such Replacement Revolving Facility, which
shall be as agreed between the Borrower, the Lenders providing such Replacement Revolving Facility Commitments, the Administrative Agent and the
replacement is- suing bank, if any, under such Replacement Revolving Facility Commitments) taken as a whole shall (as determined by the Borrower in
good faith) be substantially similar to, or no more restrictive to the Borrower and its Restricted Subsidiaries than, those, taken as a whole, applicable to the
Revolving Commitments so replaced (except to the extent such covenants and other terms apply solely to any period after the Revolving Termination Date
or are otherwise reasonably acceptable to the Administrative Agent);
(v) there shall be no borrower (other than the Borrower) and no guarantors (other than the Guarantors) in respect of such Replacement
Revolving Facility; and
(vi) Replacement Revolving Facility Commitments and extensions of credit thereunder shall not be secured by any asset of the Borrower and its
subsidiaries other than the Collateral.
In addition, the Borrower may establish Replacement Revolving Facility Commitments to refinance and/or replace all or any portion of a Term Loan hereunder
(regardless of whether such Term Loan is repaid with the proceeds of Replacement Revolving Loans or otherwise), so long as the aggregate amount of such
Replacement Revolving Fa- cility Commitments does not exceed the aggregate amount of Term Loans repaid at the time of establishment thereof plus amounts used
to pay fees, premiums, costs and expenses (including original issue discount) and accrued interest associated therewith (it being understood that such Replacement
Revolving Facility Commitment may be provided by the Lenders holding the Term Loans being repaid and/or by any other person that would be a permitted
assignee hereunder) so long as:
(i)
before and after giving effect to the establishment of such Replacement Revolving Facility Commitments on the Replacement
Revolving Facility Effective Date each of the conditions set forth in Section 4.02 shall be satisfied to the extent required by the relevant agreement
governing such Replacement Revolving Facility Commitments,
(ii)
the remaining life to termination of such Replacement Revolving Facility Commitments shall be no shorter than the Weighted
Average Life to Maturity then applicable to the refinanced Term Loans,
(iii)
the final termination date of the Replacement Revolving Facility Commitments shall be no earlier than the scheduled final maturity
date of the refinanced Term Loans,
(iv)
Revolving Facility; and
there shall be no borrower (other than the Borrower) and no guarantors (other than the Guarantors) in respect of such Replacement
(v)
all other terms applicable to such Replacement Revolving Facility (other than provisions relating to (x) fees, interest rates and other
pricing terms and prepayment and commitment reduction and optional redemption terms which shall be as agreed between the Borrower and the Lenders
providing such Replacement Revolving Facility Commitments and (y) the amount of any letter of credit sublimit and
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swingline commitment under such Replacement Revolving Facility, which shall be as agreed between the Borrower, the Lenders providing such
Replacement Revolving Facility Commitments, the Administrative Agent and the replacement issuing bank, if any, under such Replacement Revolving
Facility Commitments) taken as a whole shall (as determined by the Borrower in good faith) be substantially similar to, or no more restrictive to the
Borrower and its Restricted Subsidiaries than, those, taken as a whole, applicable to the Term Loans being refinanced (except to the extent such covenants
and other terms apply solely to any period after the latest scheduled final maturity date of any Loans then outstanding or are otherwise reasonably
acceptable to the Administrative Agent).
Solely to the extent that an Issuing Bank is not a replacement issuing bank, as the case may be, under a Replacement Revolving Facility, it is understood and agreed
that such Issuing Bank shall not be required to issue any letters of credit under such Replacement Revolving Facility and, to the extent it is necessary for such
Issuing Bank to with- draw as an Issuing Bank, as the case may be, at the time of the establishment of such Replacement Revolving Facility, such withdrawal shall
be on terms and conditions reasonably satisfactory to such Issuing Bank, as the case may be, in its sole discretion. The Borrower agrees to reimburse each Issuing
Bank, as the case may be, in full upon demand, for any reasonable and documented out-of-pocket cost or expense attributable to such withdrawal.
(d)
The Borrower may approach any Lender or any other person that would be a permitted Assignee of a Revolving Commitment pursuant to
Section 9.05 to provide all or a portion of the Replacement Revolving Fa- cility Commitments; provided , that any Lender offered or approached to provide all or a
portion of the Replacement Revolving Facility Commitments may elect or decline, in its sole discretion, to provide a Replacement Revolving Facility Commitment.
Any Replacement Revolving Facility Commitment made on any Replacement Revolving Facility Effective Date shall be designated an additional Class of
Revolving Commitments for all purposes of this Agreement; provided, that any Replacement Revolving Facility Commitments may, to the extent provided in the
applicable Refinancing Amendment, be designated as an increase in any previously established Class of Revolving Commitments.
(e)
The Borrower and each Lender providing the applicable Refinancing Term Loans shall execute and deliver to the Administrative Agent an
amendment to this Agreement (a “ Refinancing Amendment ”) and such other documentation as the Administrative Agent shall reasonably specify to evidence such
Refinancing Term Loans and/or Replacement Revolving Facility Commitments. For purposes of this Agreement and the other Loan Docu- ments, (A) if a Lender is
providing a Refinancing Term Loan, such Lender will be deemed to have a Term Loan having the terms of such Refinancing Term Loan and (B) if a Lender is
providing a Replacement Revolving Facility Commitment, such Lender will be deemed to have a Revolving Commitment having the terms of such Replacement
Revolving Facility Commitment. Notwithstanding anything to the contrary set forth in this Agreement or any other Loan Document (including without limitation
this Section 2.20), (i) the aggregate amount of Refinancing Term Loans and Replacement Revolving Facility Commitments will not be included in the calculation of
clause (a) of the definition of Incremental Amount, (ii) no Refinancing Term Loan or Replacement Revolving Facility Commitment is required to be in any
minimum amount or any minimum increment, (iii) there shall be no condition to any incur- rence of any Refinancing Term Loan or Replacement Revolving Facility
Commitment at any time or from time to time other than those set forth in clause (a) or (c) above, as applicable and (iv) all Refinancing Term Loans, Re- placement
Revolving Facility Commitments and all obligations in respect thereof shall be Obligations under this Agreement and the other Loan Documents that rank equally
and ratably in right of security with the Term Loans and other Obligations.
(f)
Each party hereto hereby agrees that, upon the Refinancing Effective Date of any Refinancing Term Loans or Replacement Revolving Facility
Commitments, this Agreement shall be amended to the extent (but only to the extent) necessary to reflect the existence and terms of the Refinancing Term Loans or
Replacement Re- volving Facility Commitments evidenced thereby as provided for in Section 9.02. Any amendment to this Agree- ment or any other Loan
Document that is necessary to effect the provisions of this Section 2.20 (including, without limitation, to provide for the establishment of Incremental Term Loans)
and any such collateral and other documentation shall be deemed “Loan Documents” hereunder and may be memorialized in writing between the Administrative
Agent and the Borrower and furnished to the other parties hereto.
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(g)
No term loan established and outstanding under this Agreement pursuant to (i) any of Sections 2.02, 2.19 or 2.20 or (ii) an agreement or
agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the Administrative Agent with the consent of the Required
Lenders shall at any time have (x) any financial maintenance covenants of a different type than the financial covenants set forth in Section 6.10, or any financial
maintenance covenants that are more restrictive than the financial covenants set forth in Section 6.10 or (y) have negative covenants and/or default provisions that,
taken as a whole, are materially more restrictive than those applicable to the Revolving Facility as determined in good faith by the Borrower unless, in each case of
clauses (x) and (y) such terms (I) (if favorable to all then existing Lenders) are in consultation with the Administrative Agent, incorporated into this Agreement for
the benefit of all then existing Lenders (without further amendment requirements) for so long as any such term loans are outstanding or (II) become applicable only
after the Revolving Facility shall have matured or been terminated. This Section 2.20(g) shall not be waived, amended, amend- ed and restated or modified except
pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Revolving Lenders or by the Borrower and the Administrative
Agent with the consent of the Re- quired Revolving Lenders.
SECTION 2.21 Loan Repurchases .
(a)
Subject to the terms and conditions set forth or referred to below, the Borrower may from time to time, at its discretion, conduct modified
Dutch auctions in order to purchase its Term Loans of one or more Classes (as determined by the Borrower) (each, a “ P urchase Offer ”), each such Purchase Offer
to be managed exclusively by the Administrative Agent (or such other financial institution chosen by the Borrower and reasonably acceptable to the Administrative
Agent) (in such capacity, the “ Au ction Manager ”), so long as the following conditions are satisfied:
(i)
each Purchase Offer shall be conducted in accordance with the procedures, terms and conditions set forth in this Section 2.21 and the
Auction Procedures;
(ii)
no Default or Event of Default shall have occurred and be continuing on the date of the delivery of each notice of an auction and at
the time of (and immediately after giving effect to) the purchase of any Term Loans in connection with any Purchase Offer;
(iii)
the principal amount (calculated on the face amount thereof) of each and all Classes of Term Loans that the Borrower offers to
purchase in any such Purchase Offer shall be no less than
$25,000,000 (unless another amount is agreed to by the Administrative Agent) (across all such Classes);
(iv)
the aggregate principal amount (calculated on the face amount thereof) of all Term Loans of the applicable Class or Classes so
purchased by the Borrower shall automatically be cancelled and re- tired by the Borrower on the settlement date of the relevant purchase (and may not be
resold) (without any increase to Consolidated EBITDA as a result of any gains associated with cancellation of debt), and in no event shall the Borrower be
entitled to any vote hereunder in connection with such Term Loans;
(v)
no more than one Purchase Offer with respect to any Class may be ongoing at any one time.
(vi)
the Borrower represents and warrants that no Loan Party shall have any material non- public information with respect to the Loan
Parties or their subsidiaries, or with respect to the Loans or the securities of any such person, that (A) has not been previously disclosed in writing to the
Administrative Agent and the Lenders (other than because such Lender does not wish to receive such material non-public information) prior to such time
and (B) could reasonably be expected to have a material effect upon, or oth- erwise be material to, a Lender’s decision to participate in the Purchase Offer;
(vii)
at the time of each purchase of Term Loans through a Purchase Offer, the Borrower shall have delivered to the Auction Manager an
officer’s certificate of an officer certifying as to compliance with the preceding clause (vi);
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(viii)
any Purchase Offer with respect to any Class shall be offered to all Term Lenders holding Term Loans of such Class on a pro rata
basis;
(ix)
(x)
no purchase of any Term Loans shall be made from the proceeds of any Revolving Facili- ty Loan; and
the Borrower is in Pro Forma Compliance with the financial covenant set forth in Section 6.10.
(b)
The Borrower must terminate any Purchase Offer if it fails to satisfy one or more of the conditions set forth above which are required to be met
at the time which otherwise would have been the time of purchase of Term Loans pursuant to such Purchase Offer. If the Borrower commences any Purchase Offer
(and all relevant requirements set forth above which are required to be satisfied at the time of the commencement of such Purchase Offer have in fact been satisfied),
and if at such time of commencement the Borrower reasonably believes that all required conditions set forth above which are required to be satisfied at the time of
the consummation of such Purchase Offer shall be satisfied, then the Borrower shall have no liability to any Lender for any termination of such Purchase Offer as a
result of its failure to satisfy one or more of the conditions set forth above which are required to be met at the time which otherwise would have been the time of
consummation of such Purchase Offer, and any such failure shall not result in any Default or Event of Default hereunder. With respect to all purchases of Term
Loans of any Class or Classes made by the Borrower pursuant to this Section 2.21, (x) the Borrower shall pay on the settlement date of each such purchase all
accrued and unpaid interest (except to the extent otherwise set forth in the relevant offering documents), if any, on the purchased Term Loans of the applicable Class
or Classes up to the settlement date of such purchase and (y) such purchases (and the payments made by the Borrower and the cancellation of the purchased Loans,
in each case in connection therewith) shall not constitute voluntary or mandatory payments or prepayments for purposes of Section 2.08 hereof.
(c)
The Administrative Agent and the Lenders hereby consent to the Purchase Offers and the other transactions effected pursuant to and in
accordance with the terms of this Section 2.21; provided , that notwithstand- ing anything to the contrary contained herein, no Lender shall have an obligation to
participate in any such Purchase Offer. For the avoidance of doubt, it is understood and agreed that the provisions of Sections 2.13, 2.15 and 9.05 will not apply to
the purchases of Term Loans pursuant to Purchase Offers made pursuant to and in accordance with the provisions of this Section 2.21. The Auction Manager acting
in its capacity as such hereunder shall be entitled to the benefits of the provisions of Article VIII and Section 9.04 to the same extent as if each reference therein to
the “Agents” were a reference to the Auction Manager, and the Administrative Agent shall cooperate with the Auction Manager as reasonably requested by the
Auction Manager in order to enable it to perform its responsibilities and duties in connection with each Purchase Offer.
ARTICLE III
Representations and Warranties
The Borrower represents and warrants to the Lenders that:
SECTION 3.01 Organization; Powers . Each of the Borrower and its Material Subsidiaries is duly orga- nized, validly existing and, if applicable, in good
standing under the laws of the jurisdiction of its organization, has all requisite power and authority to carry on its business as now conducted and is qualified to do
business in, and is in good standing in, every jurisdiction where such qualification is required, except, in each case, where the failure to do so, individually or in the
aggregate, would not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.02 Authorization; Enforceability . The Transactions (excluding use of proceeds) are within the corporate or other organizational powers of
the Loan Parties and have been duly authorized by all necessary corporate or other organizational action. This Agreement has been and each other Loan Document
will be duly executed and delivered by each Loan Party party thereto. This Agreement constitutes, and each other Loan Document when executed and delivered will
constitute a legal, valid and binding obligation of each Loan Party party thereto, enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium
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or other laws affecting creditors’ rights or remedies generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity
or at law.
SECTION 3.03 Governmental Approvals; No Conflicts . The Transactions (excluding use of proceeds)
do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except (i) such as have been
(a)
obtained or made and are in full force and effect or those which the failure to obtain would not be reasonably expected to result in a Material Adverse Effect and (ii)
the filings referred to in Section 3.12, (b) will not violate any applicable law or regulation or the charter, by-laws or other organizational documents of the Borrower
or any other Loan Party or any order of any Governmental Authority except where any such violation would not reasonably expected to result in a Material Adverse
Effect, (c) will not violate or result in a default under any indenture, agreement or other instrument binding upon the Borrower or any other Loan Party or its assets
except as would not reasonably expected to result in a Material Adverse Effect, and (d) will not result in the creation or imposition of any Lien on any asset of the
Borrower or any of its Material Subsidiaries (other than any Permitted Lien).
SECTION 3.04 Financial Position . The Borrower has heretofore furnished to the Lenders its consoli- dated balance sheet and statements of income,
stockholders’ equity and cash flows as of and for (a) the fiscal years ended December 31, 2014 and 2013 reported on by Ernst & Young LLP, independent public
accountants and (b) the six months ended June 30, 2015. Such financial statements present fairly, in all material respects, the financial posi- tion and results of
operations and cash flows of the Borrower and its consolidated subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year-end audit
adjustments and the absence of footnotes in the case of the statements referred to in clause (b) above.
SECTION 3.05 Properties .
(a)
Each of the Borrower and its Material Subsidiaries has good title to, or valid leasehold interests in, all its real and personal property material to
its business, except for minor defects in title and Permitted Liens that do not interfere with its ability to conduct its business as currently conducted or to utilize such
properties for their in- tended purposes or as, individually or in the aggregate, would not reasonably be expected to result in a Material Ad- verse Effect.
(b)
Each of the Borrower and its Material Subsidiaries owns, or is validity licensed to use, all Intellectual Property used or held for use by such
entities or necessary to operate their respective business as currently con- ducted and contemplated to be conducted, and the operation of their respective businesses
by the Borrower and its Material Subsidiaries does not infringe upon or otherwise violate the rights of any other Person, except for any such Intellectual Property or
infringements or violations that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
SECTION 3.06 Litigation and Environmental Matters .
(a)
There are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the knowledge of the
Borrower, threatened in writing against or affecting the Borrower or any of its Restricted Subsidiaries (i) that would reasonably be expected, individually or in the
aggregate, to result in a Material Adverse Effect (other than the Disclosed Matters) or (ii) on the Closing Date, that involve this Agreement or the Transactions
(excluding use of proceeds).
(b)
Except for the Disclosed Matters and except with respect to any other matters that, individually or in the aggregate, would not reasonably be
expected to result in a Material Adverse Effect, neither the Borrower nor any of its Restricted Subsidiaries (i) has failed to comply with any Environmental Law or to
obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental
Liability, (iii) has received written notice of any claim with respect to any Environmental Liability or (iv) knows of any basis reasonably likely to result in
Environmental Liability.
SECTION 3.07 Compliance with Laws and Agreeme nts. Each of the Borrower and its Material Subsidiaries is in compliance with all laws, regulations
and orders of any Governmental Authority applicable to it or its
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property and all indentures, agreements and other instruments binding upon it or its property, except where the failure to do so, individually or in the aggregate,
would not reasonably be expected to result in a Material Adverse Effect. No Default has occurred and is continuing.
SECTION 3.08 Investment Company Status . No Loan Party is an “investment company” as defined in, or subject to regulation under, the Investment
Company Act of 1940. No part of the proceeds of any Loan will be used, whether directly or indirectly, for any purpose that entails a violation of any of the
Regulations of the Board, including Regulations T, U and X.
SECTION 3.09 Taxes . Each of the Borrower and its Material Subsidiaries has timely filed or caused to be filed all Tax returns and reports required to
have been filed and has paid or caused to be paid all Taxes required to have been paid by it, except (a) Taxes that are being contested in good faith by appropriate
proceedings and for which the Borrower or such Material Subsidiary, as applicable, has set aside on its books adequate reserves in accordance with GAAP or (b) to
the extent that the failure to do so would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect.
SECTION 3.10 ERISA . No ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events
for which liability is reasonably expected to occur, would reasonably be expected to result in a Material Adverse Effect. The present value of all accumulated benefit
obligations under each Plan (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the date of the most
recent financial statements reflecting such amounts, exceed the fair market value of the assets of such Plan by an amount which, if it were to become due, would
cause a Material Adverse Effect.
SECTION 3.11 Disclosure . To the best of the Borrower’s knowledge, neither the Lender Presentations, the CIM, nor any of the other reports, financial
statements, certificates or other written information furnished by or on behalf of the Borrower to the Administrative Agent or any Lender in connection with the
negotiation of this Agreement or delivered hereunder (as modified or supplemented by other information so furnished), taken as a whole, contained any material
misstatement of fact or omitted to state any material fact necessary to make the state- ments therein, in the light of the circumstances under which they were made,
not misleading as of the date furnished; provided that with respect to projected financial information, the Borrower represents only that such information was
prepared in good faith based upon assumptions believed to be reasonable at the time.
SECTION 3.12 Pledge Agreement . The Pledge Agreement will (to the extent required thereby) create in favor of the Collateral Agent, for the benefit of
the Lenders, a security interest in the Collateral described therein (subject to any limitations specified therein). In the case of the certificated pledged stock
constituting securities de- scribed in Section 5.09(a) as of the Closing Date, when stock certificates representing such pledged stock are deliv- ered to the Collateral
Agent (together with a properly completed and signed stock power or endorsement), and in the case of the other Collateral described in the Pledge Agreement as of
the Closing Date, when financing statements specified on Schedule 3.12 in appropriate form are filed in the offices specified on Schedule 3.12, the Collateral Agent
shall have a perfected Lien on, and security interest in, all right, title and interest of the Loan Parties in such Collateral (subject to any limitations specified therein)
to the extent perfection of such security interest can be perfected by control of securities or the filing of a financing statement, as security for the Obligations, in each
case prior and superior in right to any other Person (except Permitted Liens).
SECTION 3.13 No Chang e. Since December 31, 2014, there has been no event that has had or would reasonably be expected to have, individually or in
the aggregate, a Material Adverse Effect.
SECTION 3.14 Guarantor s. Set forth on Schedule 3.14 is a list of all Subsidiary Guarantors on the Term B-1 Effective Date, together with the
jurisdiction of organization, and ownership and ownership percentages of Equity Interests held by each such Subsidiary Guarantor in each direct subsidiary of such
Subsidiary Guarantor as of the Term B-1 Effective Date.
SECTION 3.15 Solvenc y. Immediately after the consummation of the Transactions to occur on the Closing Date, including the making of each Loan to
be made on the Closing Date and the application of the proceeds of such Loans, and after giving effect to the rights of subrogation and contribution under the
Guarantee Agreement,
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the fair value of the assets of the Borrower and its subsidiaries on a consolidated basis will exceed their debts and liabilities, subordinated, contingent or
(a)
otherwise, (b) the present fair saleable value of the assets of the Borrower and its subsidiaries on a consolidated basis will be greater than the amount that will be
required to pay the probable liability on their debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute
and matured, (c) the Borrower and its subsidiaries on a consolidated basis will be able to pay their debts and liabilities, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured and (d) the Borrower and its subsidiaries on a consolidated basis will not have unreasonably small capital
with which to conduct the business in which they are engaged, as such business is now conducted and is proposed to be conducted following the Closing Date.
SECTION 3.16 No Defaul t. No Default or Event of Default has occurred and is continuing.
SECTION 3.17 Anti-Corruption Laws and Sanction s. The Borrower has implemented and maintains in effect policies and procedures designed to ensure
compliance by the Borrower, its subsidiaries and their respective directors, officers and employees with Anti-Corruption Laws and applicable Sanctions, and the
Borrower and its subsidiaries and to their knowledge their respective officers, directors and employees are in compliance with Anti- Corruption Laws and applicable
Sanctions in all material respects. None of (a) the Borrower or any subsidiary or
(b)
to the knowledge of the Borrower, any director, officer or employee of the Borrower or any subsidiary that will act in any capacity in connection with or
benefit from the credit facility established hereby, is a Sanctioned Person. No proceeds of the Loans and no Letter of Credit shall be used by the Borrower in
violation of any Anti-Corruption Law or applicable Sanctions. No representation is made under this Section 3.17 with respect to any of the end-user individuals of
the internet services.
ARTICLE IV
Conditions
SECTION 4.01 Closing D ate. The obligations of the Lenders to make the initial Loans hereunder shall not become effective until the date on which each
of the following conditions is satisfied (or waived in accordance with Section 9.02):
(a)
The Administrative Agent (or its counsel) shall have received (including by telecopy or email transmission) from each Loan Party
party to the relevant Loan Document, a counterpart of such Loan Document signed on behalf of such Loan Party.
(b)
The Administrative Agent shall have received a favorable written opinion (addressed to the Administrative Agent and the Lenders as
of the Closing Date and dated the Closing Date) of (i) Wachtell, Lipton, Rosen & Katz, counsel for the Borrower and certain of the Loan Parties and (ii)
local counsel in each jurisdiction in which a Loan Party is organized and the laws of which are not covered by the opinion referred to in (i) above, in each
case in form and substance reasonably satisfactory to the Ad- ministrative Agent and its counsel.
(c)
The Administrative Agent shall have received such documents and certificates as the Administrative Agent or its counsel may
reasonably request relating to the organization, existence and good standing of the Loan Parties, the authorization of the Transactions (excluding use of
proceeds) and any oth- er legal matters relating to the Loan Parties, this Agreement or the Transactions (excluding use of pro- ceeds), including a certificate
of each Loan Party substantially in the form of Exhibit E , all in form and sub- stance reasonably satisfactory to the Administrative Agent and its counsel.
(d)
The Administrative Agent shall have received a certificate, dated the Closing Date and signed by the Chief Executive Officer, a Vice
President, a Financial Officer of the Borrower or any other executive officer of the Borrower who has specific knowledge of the Borrower’s financial
matters and is satisfactory to the Administrative Agent, confirming that (a) the representations and warranties of each Loan Party set forth in the Loan
Documents are true and correct as of the Closing Date and (b) as of the Closing Date, no Default has occurred and is continuing.
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(e) There shall have been delivered to the Administrative Agent an executed Perfection Certificate.
(f)
The Administrative Agent shall have received a solvency certificate in the form of Exhibit I, dated the Closing Date and signed by the
chief financial officer of the Borrower.
(g)
The Administrative Agent, the Lead Arrangers and the Lenders shall have received all fees and other amounts due and payable on or
prior to the Closing Date, including, to the extent invoiced, reimbursement or payment of all out-of-pocket expenses (including fees of legal counsel to the
Administra tive Agent, the Lead Arrangers and the Lenders) required to be reimbursed or paid by the Borrower here- under.
(h)
Since December 31, 2014, there shall have been no event that has had or would reasonably be expected to have a Material Adverse
Effect.
(i)
The Administrative Agent shall have received the results of a recent Lien search with respect to each Loan Party, and such search
shall reveal no Liens on any of the assets of the Loan Parties except for Liens permitted by Section 6.02 or discharged on or prior to the Closing Date
pursuant to docu- mentation satisfactory to the Administrative Agent.
(j)
Other than the items set forth on Schedule 5.10, the Collateral Agent shall have received the certificates representing the certificated
Equity Interests pledged pursuant to the Pledge Agreement, to- gether with an undated stock power for each such certificate executed in blank by a duly
authorized officer of the pledgor thereof.
(k)
Each Uniform Commercial Code financing statement or other filing required by the Pledge Agreement shall be in proper form for
filing.
(l)
Each Loan Party shall have provided the documentation and other information requested by the Lenders that is required by regulatory
authorities under applicable “know your customer” and anti- money-laundering rules and regulations, including without limitation, the Act, in each case as
requested at least three Business Days prior to the Closing Date.
(m)
The Administrative Agent shall have received an executed promissory note payable to the order of each Lender that requested such
promissory note at least one Business Day prior to the Closing Date (or, if requested by such Lender, to such Lender and its registered assigns) and in a
form approved by the Administrative Agent.
(n)
The Borrower shall have paid as of the Closing Date immediately after giving effect thereto to the Administrative Agent for the
account of each of the Revolving Lenders, an upfront fee as separately agreed.
(o)
(p)
of this Agreement.
The Administrative Agent shall have received copies of the UCC-3s set forth on Schedule 4.01.
The entry into and effectiveness of the IAC Credit Agreement shall have occurred sub- stantially concurrently with the effectiveness
The Administrative Agent shall notify the Borrower and the Lenders of the Closing Date, and such notice shall be conclusive and binding.
SECTION 4.02 Each Credit Eve nt. The obligation of each Lender to make a Loan on the occasion of any Borrowing (other than a continuation or
conversion of an existing Borrowing) and the obligation of the Issuing Bank to issue any Letter of Credit is subject to the satisfaction of the following conditions:
(a)
The representations and warranties of each Loan Party set forth in this Agreement shall be true and correct in all material respects
(except to the extent that any such representation and warranty is qualified by materiality or Material Adverse Effect, in which case such representation and
warranty shall
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be true and correct in all respects) on and as of the date of such Borrowing, except to the extent that any such representation and warranty relates to an
earlier date (in which case such representation and warranty shall have been true and correct in all material respects (except to the extent that any such
representation and warranty is qualified by materiality or Material Adverse Effect, in which case such representation and warranty shall be true and correct
in all respects) as of such earlier date); provided that in the case of any Incremental Term Facility used to finance an acquisition permitted hereunder, to the
extent the Lenders participating in such Incremental Term Facility agree, this Section 4.02(a) shall require only customary “specified representations” and
“acquisition agreement representations” (i.e., those representations of the seller or the target (as applicable) in the applicable acquisition agreement that are
material to the interests of the Lenders and only to the extent that the Borrower or its applicable subsidiary has the right to terminate its obligations under
the applicable acquisition agreement as a result of the failure of such representations to be accurate) be true and correct in all material respects (except to
the extent that any such representation and warranty is qualified by materiality or Material Adverse Effect, in which case such representation and warranty
shall be true and correct in all respects).
(b)
At the time of and immediately after giving effect to such Borrowing, no Default or Event of Default shall have occurred and be
continuing.
(c)
The Administrative Agent or Issuing Bank shall have received a borrowing notice in ac- cordance with Section 2.03 or a Letter of
Credit request in accordance with Section 2.17(b), as applicable.
Each Borrowing shall be deemed to constitute a representation and warranty by the Borrower or other applicable Loan Party on the date thereof as to the matters
specified in paragraphs (a) and (b) of this Section.
ARTICLE V
Affirmative Covenants
Until the Revolving Commitments have expired or been terminated and the principal of and interest on each Loan and all fees payable hereunder shall have
been paid in full and all Letters of Credit have expired or been cash collateralized, the Borrower covenants and agrees with the Lenders that:
SECTION 5.01 Financial Statements; Other Information . The Borrower will furnish to the Administra- tive Agent and each Lender:
(a)
within 90 days after the end of each fiscal year of the Borrower, its audited consolidated balance sheet and related statements of
operations, stockholders’ equity and cash flows as of the end of and for such year, setting forth in each case in comparative form the figures for the
previous fiscal year, all re- ported on by Ernst & Young LLP or other independent public accountants of recognized national standing (without a “going
concern” or like qualification or exception and without any qualification or exception as to the scope of such audit except as to the effectiveness of internal
control over financial reporting with re- spect to any subsidiary acquired during such fiscal year in accordance with Regulation S-X under the Ex- change
Act, as interpreted by the implementation guidance of the U.S. Securities Exchange Commission) to the effect that such consolidated financial statements
present fairly in all material respects the financial position and results of operations of the Borrower and its consolidated subsidiaries on a consolidated
basis in accordance with GAAP consistently applied (except as approved by such accountants and disclosed there- in), and a schedule eliminating
Unrestricted Subsidiaries and reconciling to the financial statements in reasonable detail, as determined by the Borrower;
(b)
within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Borrower, its consolidated balance sheet
and related statement of operations as of the end of and for such fiscal quarter and the then elapsed portion of the fiscal year and the statements of
stockholders’ equity
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and cash flows for the then elapsed portion of the fiscal year, setting forth in each case in comparative form the figures for the corresponding period or
periods of (or, in the case of the balance sheet, as of the end of) the previous fiscal year, all certified by one of its Financial Officers as presenting fairly in
all material respects the financial position and results of operations of the Borrower and its consolidated subsidiaries on a consolidated basis in accordance
with GAAP consistently applied (except as approved by such officer and disclosed therein), subject to normal year-end audit adjustments and the absence of
footnotes, and a schedule eliminating Unrestricted Subsidiaries and reconciling to the financial statements;
(c)
within 90 days after the end of each fiscal year of the Borrower, forecasts of the cash and cash equivalents and long-term debt line
items on the consolidated balance sheets and forecasts of the statements of operations and cash flows, in each case of the Borrower and the Restricted
Subsidiaries on a quarterly basis for the then current fiscal year, in each case prepared by management of Borrower and sub- stantially in the form as the
forecasts delivered by the Borrower to the Lead Arrangers prior to the Closing Date;
(d)
concurrently with any delivery of financial statements under clause (a) or (b) above, a certificate of a Financial Officer of the
Borrower (i) certifying as to whether a Default has occurred and, if a Default has occurred, specifying the details thereof and any action taken or proposed
to be taken with re- spect thereto, (ii) setting forth reasonably detailed calculations demonstrating compliance with Section 6.10, (iii) stating whether any
change in GAAP or in the application thereof that materially affects such fi- nancial statements has occurred since the date of the audited financial
statements referred to in Section 3.04 and, if any such change has occurred, specifying the effect of such change on the financial statements ac- companying
such certificate, (iv) setting forth a description of any change in the jurisdiction of organization of the Borrower or any Material Domestic Subsidiary since
the date of the most recent certificate delivered pursuant to this paragraph (d) (or, in the case of the first such certificate so delivered, since the Closing
Date) and (v) setting forth a calculation in reasonable detail indicating which Domestic Subsidiaries are Material Domestic Subsidiaries;
(e)
concurrently with any delivery of financial statements under clause (a) above, a certifi- cate of the accounting firm that reported on
such financial statements stating whether they obtained knowledge during the course of their examination of such financial statements of any Default
(which certificate may be limited to the extent required by accounting rules or guidelines and may be limited to accounting matters and disclaim
responsibility for legal interpretations);
(f)
promptly following receipt thereof, copies of any documents described in Section 101(k) or 101(l) of ERISA that the Borrower or any
ERISA Affiliate may request with respect to any Multiem- ployer Plan; provided that if the Borrower and/or any ERISA Affiliate has not requested such
documents or notices from the administrator or sponsor of the applicable Multiemployer Plan then, upon reasonable re- quest of the Administrative Agent,
the Borrower and/or its ERISA Affiliates shall promptly make a request for such documents or notices from such administrator or sponsor and the Borrower
shall provide copies of such documents and notices to the Administrative Agent (on behalf of each requesting Lender) promptly after receipt thereof; and
(g)
promptly following any reasonable request therefor, such other information regarding the operations, business affairs and financial
position of the Borrower or any Restricted Subsidiary, or compliance with the terms of this Agreement, as the Administrative Agent (on its own behalf or at
the request of any Lender) may reasonably request.
Information required to be delivered pursuant to this Section 5.01 shall be deemed to have been delivered if such information (including, in the case of certifications
required pursuant to clause (b) above, the certifications accom- panying any such quarterly report pursuant to Section 302 of the Sarbanes-Oxley Act of 2002), or one
or more an- nual or quarterly reports containing such information, shall have been posted by the Administrative Agent on Intra- Links or a similar site to which the
Lenders have been granted access or shall be available on the website of the SEC at http://www.sec.gov; provided that the Borrower shall notify (which may be by
facsimile or electronic mail) the Administrative Agent of the posting of such documents and provide to the Administrative Agent by electronic mail
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electronic versions (i.e. soft copies) of such documents. Information required to be delivered pursuant to this Sec- tion 5.01 may also be delivered by electronic
communications pursuant to procedures approved by the Administra- tive Agent. In the event any financial statements delivered under clause (a) or (b) above shall
be restated, the Bor- rower shall deliver, promptly after such restated financial statements become available, revised completed certifi- cates with respect to the
periods covered thereby that give effect to such restatement, signed by a Financial Officer.
The Borrower acknowledges and agrees that all financial statements furnished pursuant to paragraphs (a) and (b) above are hereby deemed to be Borrower Materials
suitable for distribution, and to be made available, to Public Lenders as contemplated by Section 9.18 and may be treated by the Administrative Agent and the
Lenders as if the same had been marked “PUBLIC” in accordance with such paragraph (unless the Borrower otherwise notifies the Administrative Agent in writing
on or prior to delivery thereof).
SECTION 5.02 Notices of Material Events . The Borrower will furnish to the Administrative Agent for delivery to each Lender prompt written notice of
the following:
(a)
(b)
the occurrence of any Default;
the filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against the
Borrower or any Restricted Subsidiary thereof as to which there is a reasonable likelihood of an adverse determination that would reasonably be expected
to result in a Material Adverse Effect;
(c)
the occurrence of any ERISA Event that, alone or together with any other ERISA Events that have occurred, would reasonably be
expected to result in liability of the Borrower or its Restricted Subsidiaries in an amount which would constitute a Material Adverse Effect; and
(d)
any other development that results in, or would reasonably be expected to result in, a Material Adverse Effect.
Each notice delivered under this Section shall be accompanied by a statement of a Financial Officer or other executive officer of the Borrower setting forth
the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.
SECTION 5.03 Existence; Conduct of Business . The Borrower will, and will cause each of its Restrict- ed Subsidiaries to, do or cause to be done all
things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges and franchises material to the
conduct of its business except in each case (i) where the failure to do so would not reasonably be expected to result in a Material Adverse Effect or (ii) as such action
is not prohibited under Sections 6.03, 6.04 or 6.05.
SECTION 5.04 Payment of O bligations. The Borrower will, and will cause each of its Restricted Subsidiaries to, pay its obligations, including Tax
liabilities, that, if not paid, would, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is being contested in good faith by appropriate proceedings, (b) the Borrower or such
Restricted Subsidiary has set aside on its books adequate reserves with respect thereto in accord- ance with GAAP and (c) the failure to make payment pending such
contest would not reasonably be expected to, individually or in the aggregate, result in a Material Adverse Effect.
SECTION 5.05 Maintenance of Properties; Insurance . The Borrower will, and will cause each of its Restricted Subsidiaries to (a) keep and maintain all
property material to the conduct of its business in good working order and condition, ordinary wear and tear excepted, (b) maintain, with financially sound and
reputable insurance companies or in accordance with acceptable self insurance practices, insurance in such amounts and against such risks as are customarily
maintained by companies of similar size engaged in the same or similar businesses operating in the same or similar locations, and (c) and use commercially
reasonable efforts to maintain, prosecute and enforce its material Intellectual Property, in each case except where the failure to do so would not reasonably be
expected to result in a Material Adverse Effect.
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SECTION 5.06 Books and Records; Inspection Rights . The Borrower will, and will cause each of its Restricted Subsidiaries to, keep proper books of
record and account in which full, true and correct entries in all ma- terial respects are made of all dealings and transactions in relation to its business and activities.
The Borrower will, and will cause each of its Restricted Subsidiaries to, permit any representatives designated by the Administrative Agent or any Lender to visit
and inspect its properties, to examine and make extracts from its books and records, and to discuss its affairs, finances and condition with its officers and
independent accountants all at such reasonable times and as often as reasonably requested, provided that such visits, inspections, examinations and discussions shall,
so long as no Default or Event of Default has occurred and is continuing, take place no more often than one time per fiscal year on a date to be determined by, and
shall be coordinated by, the Borrower and the Administrative Agent.
SECTION 5.07 Compliance with Laws . The Borrower will, and will cause each of its Restricted Sub- sidiaries to, comply with all laws, rules,
regulations and orders of any Governmental Authority applicable to it or its property, except where the failure to do so, individually or in the aggregate, would not
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.08 Use of Proceeds . The proceeds of the Loans will be used only to finance the general corporate purposes of the Borrower and its
Restricted Subsidiaries, including to fund dividends and other distributions to IAC.
SECTION 5.09 Guarantors and Collateral .
(a)
On the Closing Date (or such longer period as the Collateral Agent may agree in its sole discre- tion) each Restricted Subsidiary (other than an
Excluded Subsidiary) will (A) become a party to the Guarantee Agreement and (B) become a party to the Pledge Agreement and pledge all of the Equity Interests of
any Restricted Subsidiary (other than Excluded Equity Interests) directly owned by such Restricted Subsidiary and any other shares, stock certificates, options,
interests or rights of any nature whatsoever in respect of the Equity Interests of any Restricted Subsidiary (other than Excluded Equity Interests) that may be issued
or granted to, or held by, such Restricted Subsidiary while this Agreement is in effect; provided that such Restricted Subsidiary shall not be re- quired to take any
action (including entry into any foreign pledge agreement or similar document) other than those actions expressly set forth in this clause (B) and deliver to the
Collateral Agent any and all certificates representing such Equity Interests (to the extent certificated), accompanied by undated stock powers or other appropriate
instruments of transfer executed in blank.
(b)
With respect to any Person that becomes a Restricted Subsidiary (other than an Excluded Subsidi- ary) after the Closing Date, or any Excluded
Subsidiary that ceases to constitute an Excluded Subsidiary after the Closing Date, the Borrower will, within 30 days thereafter (or such longer period as the
Collateral Agent may agree in its sole discretion) (i) cause such Restricted Subsidiary to (A) become a party to the Guarantee Agreement, (B) become a party to the
Pledge Agreement or such other Collateral Document as may be reasonably requested by the Collateral Agent, (C) pledge all of the Equity Interests of any
Restricted Subsidiary (other than Excluded Equity Interests) directly owned by such Restricted Subsidiary and any other shares, stock certificates, options, interests
or rights of any nature whatsoever in respect of the Equity Interests of any Restricted Subsidiary (other than Excluded Equity Interests) that may be issued or granted
to, or held by, such Restricted Subsidiary while this Agreement is in effect, (D) deliver to the Collateral Agent any and all certificates representing such Equity
Interests (to the extent certificated), accompanied by undated stock powers or other appropriate instruments of transfer executed in blank and (E) deliver to the
Administrative Agent a certificate of such Restricted Subsidiary substantially in the form of Exhibit E, with appropriate insertions and attachments, and (ii) if
requested by the Administrative Agent, deliver to the Administrative Agent one or more legal opinions relating to the matters described above, which shall be in
form and substance, and from counsel, reasonably satisfactory to the Administrative Agent.
SECTION 5.10 Post-Closing Delivery of Certificated Equity Interests . Within 30 days of the Closing Date (or such later date as the Administrative
Agent may reasonably agree), to the extent not previously delivered, the Borrower agrees that it will deliver to the Collateral Agent the certificates representing the
certificated Equity Interests pledged pursuant to the Pledge Agreement listed on Schedule 5.10, together with an undated stock power for each such certificate
executed in blank by a duly authorized officer of the pledgor thereof.
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SECTION 5.11 Further Assurances . Promptly upon the reasonable request by the Administrative Agent, or any Lender through the Administrative
Agent, the Borrower shall, shall cause the Subsidiary Guarantors to (a) correct any material defect or error that may be discovered in the execution,
acknowledgment, filing or re- cordation of any Loan Document, 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 Administra- tive Agent, or any Lender through the Administrative Agent, may
reasonably require from time to time in order to
(i) carry out the purposes of the Loan Documents, (ii) to the fullest extent permitted by applicable law, subject any Loan Party’s Equity Interests to the Liens granted
by the Pledge Agreement to the extent required thereunder and
(iii)
perfect and maintain the validity, effectiveness and priority of the Pledge Agreement and any of the Liens created thereunder.
SECTION 5.12 Ratings . The Borrower shall use commercially reasonable efforts to obtain and to maintain public ratings from Moody’s and Standard &
Poor’s for the Term B-1 Loans; provided , however , that the Borrower shall not be required to obtain or maintain any specific rating.
ARTICLE VI
Negative Covenants
Until the Revolving Commitments have expired or terminated and the principal of and interest on each Loan and all fees payable hereunder have been paid
in full and all Letters of Credit have expired or have been cash collateralized, the Borrower covenants and agrees with the Lenders that:
SECTION 6.01 Indebtednes s. The Borrower will not, and will not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any
Indebtedness, except:
(a)
(b)
(c)
Indebtedness incurred under the Loan Documents;
Indebtedness in respect of the Senior Notes and Permitted Ratio Debt and any Refinancing Indebtedness thereof;
(i) Indebtedness of the Borrower or any other subsidiary incurred to finance the acquisi- tion, construction or improvement of any
fixed or capital assets, including Capital Lease Obligations, and any Indebtedness assumed in connection with the acquisition of any such assets ( p rovided
that such Indebtedness is incurred or assumed prior to or within 90 days after such acquisition or the completion of such construction or improvement and
the principal amount of such Indebtedness does not exceed the cost of ac- quiring, constructing or improving such fixed or capital assets) in an aggregate
amount under this clause (c) not to exceed the greater of $50,000,000 and 2.0% of Total Assets as of the time of incurrence; provided that (x) no Default
shall have occurred and be continuing and (y) the Borrower shall be in pro forma compliance with Section 6.10 and (ii) any Refinancing Indebtedness
thereof;
(d)
Indebtedness of Foreign Subsidiaries in an aggregate principal amount at any time out- standing not to exceed the multiple of (x)
$50,000,000 and (y) the sum of 100% plus the percentage (which shall not be less than 0%) by which Consolidated EBITDA of the Borrower for the most
recently ended Test Period exceeds Consolidated EBITDA of the Borrower for the most recent Test Period on the Closing Date;
(e)
(f)
Indebtedness of any Non-Loan Party in an aggregate principal amount at any time out- standing not to exceed $25,000,000;
Guarantees of any Indebtedness permitted pursuant to this Section 6.01 and any Refi- nancing Indebtedness thereof, so long as in the
case of clause (b), the Loans are guaranteed by such Re- stricted Subsidiary to at least the same extent and, in the case of any Guarantees of Permitted
Unsecured Debt or the Senior Notes, such Guarantees are by their terms subordinated in right of payment to the Obligations;
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(g)
IAC/Match Intercompany Debt;
(h)
(x) Indebtedness of the Borrower owed to any Restricted Subsidiary or of a Restricted Subsidiary owed to any other Restricted Subsidiary
or the Borrower and (y) guarantees by any Restricted Subsidiary or the Borrower of any Indebtedness of the Borrower or any other Restricted Subsidiary; pro-
vided , however , that upon any such Indebtedness being owed to any Person other than the Borrower or a Restricted Subsidiary or any such guarantee being of
Indebtedness of any Person other than the Borrower or a Restricted Subsidiary, as applicable, the Borrower or such Restricted Subsidiary, as applicable, shall be
deemed to have incurred Indebtedness not permitted by this clause (h);
(i)
(j)
Indebtedness outstanding on the Closing Date and set forth on Schedule 6.01 and any Re- financing Indebtedness thereof;
(i) Indebtedness of any Person which becomes a Restricted Subsidiary after the Closing Date or is merged with or into or consolidated or
amalgamated with the Borrower or any Restricted Subsidiary after the Closing Date and Indebtedness expressly assumed in connection with the acquisition of an
as- set or assets from any other Person; provided that (A) such Indebtedness existed at the time such Person became a Restricted Subsidiary or of such merger,
consolidation, amalgamation or acquisition and was not created in anticipation thereof and (B) immediately after such Person becomes a Restricted Subsidiary or
such merger, consolidation, amalgamation or acquisition, (x) no Default shall have occurred and be continuing, and (y) the Borrower shall be in pro forma
compliance with Section 6.10 and (ii) any Refinancing Indebtedness of such Indebtedness described in clause (i);
(k)
Indebtedness constituting Investments not prohibited under Section 6.11 (other than Sec- tion 6.11(g));
(l)
Indebtedness in respect of bid, performance, surety bonds or completion bonds issued for the account of the Borrower or any Restricted
Subsidiary in the ordinary course of business, including guarantees or obligations of the Borrower or any Restricted Subsidiary with respect to letters of credit
sup- porting such bid, performance, surety or completion obligations;
(m)
Indebtedness owed to any officers or employees of the Borrower or any Restricted Sub- sidiary; provided that the aggregate principal
amount of all such Indebtedness shall not exceed $5,000,000 at any time outstanding;
(n)
Indebtedness arising or incurred as a result of or from the adjudication or settlement of any litigation or from any arbitration or mediation
award or settlement, in any case involving the Borrower or any Restricted Subsidiary, provided that the judgment, award(s) and/or settlements to which such
Indebtedness relates would not constitute an Event of Default under Section 7.01(j);
(o)
indemnification, adjustment of purchase price, deferred purchase price, contingent con- sideration or other compensation or similar
obligations, in each case, incurred or assumed in connection with the acquisition or disposition of any business or assets of the Borrower or any Restricted
Subsidiary or Equity Interests of a Restricted Subsidiary, other than Guarantees of Indebtedness incurred by any Person acquiring all or any portion of such
business, assets or Equity Interests for the purpose of financing or in contemplation of any such acquisition; provided that, in the case of a disposition, the
maximum aggregate liability in respect of all such obligations incurred or assumed in connection with such disposition outstanding under this clause (o) shall at
no time exceed the gross proceeds (including Fair Market Value of non- cash proceeds measured at the time such noncash proceeds are received) actually
received by the Borrower and the Restricted Subsidiaries in connection with such disposition;
(p)
unsecured Indebtedness in respect of obligations of the Borrower or any of its Restricted Subsidiaries to pay the deferred purchase price of
goods or services or progress payments in connection with such goods and services; provided that such obligations are incurred in connection with open
accounts extended by suppliers on customary trade terms (which require that all such payments be made within 60
83
days after the incurrence of the related obligations) in the ordinary course of business and not in connection with the borrowing of money;
(q)
letters of credit, bank guarantees, warehouse receipts or similar instruments issued to support performance obligations and trade letters of
credit (other than obligations in respect of other In- debtedness) in the ordinary course of business;
(r)
Indebtedness arising (A) from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against
insufficient funds in the ordinary course of business; pro- vided , however , that such Indebtedness is extinguished within five Business Days of incurrence or
(B) un- der any customary cash pooling or cash management agreement with a bank or other financial institution in the ordinary course of business;
(s)
(t)
(u)
Indebtedness representing deferred compensation incurred in the ordinary course of business;
Indebtedness arising in connection with endorsement of instruments for deposit in the or- dinary course of business;
Indebtedness supported by a letter of credit, bank guarantee or similar instrument, in principal amount not in excess of the stated amount of
such letter of credit, bank guarantee or similar instrument;
(v)
(w)
the disposition of accounts receivable in connection with receivables factoring arrangements in the ordinary course of business;
Indebtedness of the Borrower consisting of obligations for the payment of letters of credit in commitment amounts not to exceed
$10,000,000 in the aggregate at any one time outstanding, excluding any commitment amounts for letters of credit issued pursuant to Indebtedness incurred
under any other clause of this Section 6.01;
(x)
any guarantee by the Borrower or any of its Restricted Subsidiaries, in the ordinary course of business, of obligations of suppliers,
customers, franchisees and licensees of the Borrower or any of its Restricted Subsidiaries;
(y)
(z)
[reserved];
unsecured intercompany Indebtedness owed by a member of the Match Group to a member of the IAC Group that is by its terms
subordinated in right of payment to the Obligations (the “ IAC Subordinated Debt Facility ”), so long as, (I) in respect of each borrowing, on a pro forma basis
after giving effect thereto and the use of proceeds thereof the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00 (excluding any cash
constituting proceeds of such Indebtedness), (II) no Default or Event of Default shall have occurred and be continuing or would exist after giving effect thereto,
(III) the Borrower shall be in compliance with Section 6.10 on a pro forma basis after giving effect to the incurrence of any such borrowing and the use of
proceeds thereof, (IV) such Indebtedness has a scheduled final maturity date of at least 90 days after the Revolving Termination Date and any then outstanding
Incremental Facility and such indebtedness shall not require any mandatory prepayments other than in connection with a change of control, (V) such
indebtedness (x) shall not require scheduled amortization payments, (y) shall have no financial maintenance covenants of a different type than the Financial
Covenants, and no financial maintenance covenants that are more restrictive than the Financial Covenants,and (z) does not have negative covenants and/or
default provisions that are, taken as a whole, materially more restrictive than those applicable to the Senior Secured Credit Facilities as determined in good faith
by the Borrower, and (VI) such Indebtedness shall not be guaranteed by any subsidiaries of the Borrower other than guarantees by the Guarantors that by their
terms are subordinated in right of payment to the obligations under the Senior Secured Credit Facilities;
84
(aa) Indebtedness of Loan Parties in an aggregate principal amount at any time outstanding not to exceed $25,000,000;
(bb) any Pre-IPO Notes; and
(cc) to the extent constituting Indebtedness, the Match Transactions.
Further, for purposes of determining compliance with this Section 6.01 and Section 6.02, at the option of the Borrower by written notice to the
Administrative Agent, any Indebtedness and/or Lien incurred to finance a Limited Condition Acquisition permitted hereunder shall be deemed to have been incurred
on the date the definitive acquisition agreement relating to such Limited Condition Acquisition was entered into (and not at the time such Limited Condition
Acquisition is consummated) and the Secured Net Leverage Ratio and/or the Consolidated Net Leverage Ratio shall be tested (x) in connection with such incurrence,
as of the date the definitive acquisition agreement relating to such Limited Condition Acquisition was entered into, giving pro forma effect to such Limited Condition
Acquisition, to any such Indebtedness or Lien, and to all transactions in connection therewith and (y) in connection with any other incurrence after the date the
definitive acquisition agreement relating to such Limited Condition Acquisition was entered into and prior to the earlier of the consummation of such Limited
Condition Acquisition or the termination of such definitive agreement prior to the incurrence (but not, for the avoidance of doubt, for purposes of determining the
Applicable Rate or actual compliance with the Financial Covenants), both (i) on the basis set forth in clause (x) above and (ii) without giving effect to such
acquisition or the incurrence of any such Indebtedness or Liens or the other transactions in connection therewith.
SECTION 6.02 Liens . The Borrower will not, and will not permit any Restricted Subsidiary to, create, incur, assume or permit to exist any Lien on any
property or asset now owned or hereafter acquired by it, or assign or sell any income or revenues (including accounts receivable) or rights in respect of any thereof,
except:
(a) Permitted Encumbrances;
(b) any Lien on any property or asset of the Borrower or any Restricted Subsidiary (or any improvements or accession thereto or proceeds
therefrom) existing on the Closing Date and set forth in Schedule 6.02; provided that (i) such Lien shall not apply to any other property or asset of the
Borrower or any Restricted Subsidiary and (ii) such Lien shall secure only those obligations which it secures on the Closing Date and any Refinancing
Indebtedness in respect thereof;
(c) any Lien existing on any property or asset prior to the acquisition thereof by the Borrow- er or any Restricted Subsidiary or existing on any
property or asset of any Person that becomes a Restricted Subsidiary after the Closing Date prior to the time such Person becomes a Restricted Subsidiary;
provided that (i) such Lien is not created in contemplation of or in connection with such acquisition or such Person becoming a Restricted Subsidiary, as the
case may be, (ii) such Lien shall not apply to any other property or assets of the Borrower or any Restricted Subsidiary and (iii) such Lien shall secure only
those obligations which it secures on the date of such acquisition or the date such Person becomes a Restricted Subsidiary, as the case may be, and any
Refinancing Indebtedness in respect thereof;
(d) Liens securing Indebtedness of the Borrower or any Restricted Subsidiary incurred pur- suant to Section 6.01(c); provided that (i) such Liens
are incurred prior to or within 90 days after such ac- quisition or the completion of such construction and improvement with the acquisition of such fixed or
capital assets, and (ii) such Liens do not at any time encumber any of its existing property other than the property financed by such Indebtedness;
(e) deposits, reserves and other Liens securing credit card operations of the Borrower and its Restricted Subsidiaries;
(f)
(g)
Liens created by the Collateral Documents or otherwise securing the Obligations;
Liens on the Collateral securing Permitted Secured Ratio Debt;
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(h)
[reserved];
(i) Liens securing Guarantees of Permitted Secured Ratio Debt and Indebtedness permitted pursuant to Section 6.01(a); provided that, with respect to
any such Liens securing Guarantees of Permitted Secured Ratio Debt an intercreditor agreement reasonably satisfactory to the Administrative Agent with re-
spect to such Liens is in effect at such time;
(j) Liens that do not secure Indebtedness and do not interfere with the material operations of the Borrower and the Restricted Subsidiaries and do not
individually or in the aggregate materially impair the value of the assets of the Borrower and the Restricted Subsidiaries;
(k) Liens deemed to secure Capital Lease Obligations incurred in connection with any sale and leaseback transaction permitted by Section 6.08;
(l) licenses, sublicenses, leases or subleases that do not interfere in any material respect with the business of the Borrower or any Restricted
Subsidiary;
(m) any interest or title of a lessor or sublessor under, and Liens arising from Uniform Com- mercial Code financing statements (or equivalent filings,
registrations or agreements in foreign jurisdic- tions) relating to, leases and subleases permitted hereunder;
(n) normal and customary rights of setoff upon deposits of cash or other Liens originating solely by virtue of any statutory or common law provision
relating to bankers liens, rights of setoff or similar rights in favor of banks or other depository institutions and not securing any Indebtedness;
(o) Liens of a collection bank arising under Section 4-210 of the Uniform Commercial Code on items in the course of collection;
(p) Liens solely on any cash earnest money deposits made by the Borrower or any Restricted Subsidiary in connection with any letter of intent or
purchase agreement in respect of any acquisition or other investment by the Borrower or any Restricted Subsidiary;
(q) Liens on assets of Non-Loan Parties securing Indebtedness permitted pursuant to Sections 6.01(d) and (e);
(r) any extension, renewal or replacement (or successive renewals or replacements) in whole or in part of any Lien referred to in clause (b), (c), (d),
(g), (i) or (q); provided that with respect to (b), (c) and (d), (x) the obligations secured thereby shall be limited to the obligations secured by the Lien so ex-
tended, renewed or replaced (and, to the extent provided in such clauses, extensions, renewals and replacements thereof) and (y) such Lien shall be limited to all
or a part of the assets that secured the Lien so ex- tended, renewed or replaced;
(s) Liens encumbering deposits made to secure obligations arising from common law, statu- tory, regulatory, contractual or warranty requirements of
the Borrower or any Restricted Subsidiary, including rights of offset and setoff;
(t) Liens securing Hedging Obligations entered into for bona fide hedging purposes of the Borrower or any Restricted Subsidiary not for the purpose
of speculation;
(u)
Liens in favor of a Loan Party;
(v) Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the
importation of goods and Liens in the ordinary course of business in favor of issuers of performance and surety bonds or bid bonds or with respect to health,
safety and environmental regulations (other than for borrowed money) or letters of credit or bank guarantees is-
86
sued to support such bonds or requirements pursuant to the request of and for the account of such Person in the ordinary course of business;
(w) Interests of vendors in inventory arising out of such inventory being subject to a “sale or return” arrangement with such vendor or any
consignment by any third party of any inventory;
(x) Liens securing Indebtedness owed by (a) a Restricted Subsidiary to the Borrower or to any other Restricted Subsidiary that is a Subsidiary
Guarantor or (b) the Borrower to a Subsidiary Guarantor;
(y) Liens securing obligations pursuant to cash management agreements and treasury trans- actions; and
(z) Liens arising under any retention of title, hire purchase or conditional sale arrangement or arrangements having similar effect in respect of
goods supplied to the Borrower and its Restricted Subsidi- aries in the ordinary course of trading and on the supplier’s standard or usual terms.
provided that, at any time, no voluntary Lien shall be created, incurred, assumed or permitted to exist on any Equity Interests of any Restricted Subsidiary required
to be pledged to secure the Obligations hereunder other than (i) Per- mitted Encumbrances described in clauses (a), (b) and (e) of the definition of “Permitted
Encumbrances,” (ii) Liens securing the Obligations and (iii) Liens securing Permitted Secured Ratio Debt (and Liens securing Guarantees thereof permitted by
Section 6.01(f)).
SECTION 6.03 Fundamental Changes . The Borrower will not, and will not permit any Restricted Subsidiary to, merge into or consolidate with any
other Person, or permit any other Person to merge into or consolidate with it, or Dispose of (in one transaction or in a series of related transactions) all or
substantially all of its assets, or all or substantially all of the stock of any of its Restricted Subsidiaries (in each case, whether now owned or hereafter acquired), or
liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default shall have occurred and be continuing:
(i) any Person may merge or be consolidated with or into the Borrower in a transaction in which the Borrower is the continuing or surviving
Person;
(ii) any Person (other than the Borrower) may merge or consolidate with or into any Restrict- ed Subsidiary in a transaction in which the
surviving entity is or becomes a Restricted Subsidiary; provided that, if such Person is a Subsidiary Guarantor, the surviving entity is the Borrower or is or
substantially concurrently becomes a Subsidiary Guarantor;
(iii) any merger, consolidation, Disposition, liquidation or dissolution not prohibited by Sec- tions 6.04, 6.05 and 6.11 shall be permitted;
(iv) any Restricted Subsidiary may Dispose of its assets, and the Borrower or any Restricted Subsidiary may Dispose of any stock of any of its
Restricted Subsidiaries, in each case to the Borrower or to another Restricted Subsidiary; and
(v) any Restricted Subsidiary may liquidate or dissolve if the Borrower determines in good faith that such liquidation or dissolution is in the
best interests of the Borrower and is not materially disadvantageous to the Lenders.
SECTION 6.04 Disposition of Prope rty. The Borrower will not, and will not permit any Restricted Subsidiary to, directly or indirectly, consummate any
Asset Sale unless at the time of such transaction and after giv- ing effect thereto and to the use of proceeds thereof, (i) no Default shall have occurred and be
continuing and (ii) the Borrower or such Restricted Subsidiary, as the case may be, receives consideration at least equal to the Fair Market Value of the assets sold or
otherwise disposed of, and (iii) in the case of an Asset Sale other than an Asset Swap if after giving pro forma effect to such Asset Sale (x) prior to the Term B-1
Loan Repayment Date, the Secured Net
87
Leverage Ratio is greater than 1.50 to 1.00 and (y) on or after the Term B-1 Loan Repayment Date, the Consolidated Net Leverage Ratio is greater than 4.50 to 1.00,
at least 75% of the consideration therefor received by the Borrower or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents;
provided that the amount of:
(i)
any liabilities (as reflected in the Borrower’s or such Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto, or if
incurred or accrued subsequent to the date of such balance sheet, such liabilities that would have been shown on the Borrower’s or such Restricted
Subsidiary’s bal- ance sheet or in the footnotes thereto if such incurrence or accrual had taken place on the date of such bal- ance sheet) of the Borrower or
such Restricted Subsidiary other than liabilities that are by their terms sub- ordinated in right of payment to the Loans, that are assumed by the transferee of
any such assets and for which the Borrower and all of its Restricted Subsidiaries have been validly released by all creditors in writing,
(ii)
any securities, notes or other similar obligations received by the Borrower or such Re- stricted Subsidiary from such transferee that
are converted by the Borrower or such Restricted Subsidiary into cash or Cash Equivalents (to the extent so converted) within 180 days following the
closing of such Asset Sale, and
(iii)
any Designated Noncash Consideration received by the Borrower or any Restricted Subsidiary in such Asset Sale having an
aggregate Fair Market Value, taken together with all other Designated Noncash Consideration received pursuant to this clause (iii) that is at that time
outstanding, not to exceed the greater of $75,000,000 and 3.0% of Total Assets at the time of the receipt of such Designated Noncash Consideration, with
the Fair Market Value of each item of Designated Noncash Consideration being measured at the time received and without giving effect to subsequent
changes in value,
shall be deemed to be cash or Cash Equivalents for purposes of this provision and for no other purpose.
SECTION 6.05 Restricted Payments . The Borrower will not, and will not permit any of its Restricted Subsidiaries to, declare or make, directly or
indirectly, any Restricted Payment, except:
(i)
the payment by the Borrower or any Restricted Subsidiary of any dividend or the con- summation of any irrevocable redemption
within 60 days after the date of declaration thereof or giving the notice of the redemption, if on the date of declaration or notice the payment would have
complied with the provisions of the Indenture (assuming, in the case of redemption, the giving of the notice would have been deemed to be a Restricted
Payment at such time and such deemed Restricted Payment would have been permitted at such time);
(ii)
the Borrower may declare or make a Restricted Payment with respect to its Equity Inter- est payable solely in Qualified Equity
Interests or redeem any of its Equity Interests in exchange for, or out of the proceeds of the substantially concurrent issuance and sale of, Qualified Equity
Interests or through accretion or accumulation of such dividends on such Equity Interests; provided that the issuance of such Equity Interests are not
included in any determination of the Retained Excess Cash Flow Amount;
(iii)
repurchase, redemption or other acquisition for value by the Borrower of, Equity Interests of the Borrower held by officers, directors
or employees or former officers, directors or employees of the Borrower and any Restricted Subsidiary (or their transferees, estates or beneficiaries under
their estates), upon their death, disability, retirement, severance or termination of employment or service; provided that the aggregate cash consideration
paid for all such redemptions shall not exceed $10,000,000 during any twelve consecutive months (with unused amounts in any period being carried over to
succeeding periods); provided , further , that cancellation of Indebtedness owing to the Borrower or any Restricted Subsidiary from any current or former
officer, director or employee (or any permitted transferees thereof) of the Bor- rower or any of its Restricted Subsidiaries (or any direct or indirect parent
company thereof), in connection with a repurchase of Equity Interests of the Borrower from such Persons will not be deemed to constitute a Restricted
Payment for purposes of this covenant or any other provisions of the Indenture;
88
(iv)
repurchases of Equity Interests deemed to occur (a) upon the exercise of stock options, warrants, or similar rights if the Equity Interests
represent all or a portion of the exercise price thereof or (b) in connection with the satisfaction of any withholding Tax obligations incurred relating to the
vesting or exercise of stock options, warrants, restricted stock units or similar rights;
(v)
any Restricted Payment made out of the net cash proceeds of the substantially concurrent sale of, or made by exchange for, Qualified
Equity Interests of the Borrower (other than Qualified Equity Interests issued or sold to a Restricted Subsidiary of the Borrower or an employee stock ownership
plan or to a trust established by the Borrower or any of its Restricted Subsidiaries for the benefit of their employees) or a substantially concurrent cash capital
contribution received by the Borrower from its stockholders; provided that such net cash proceeds are not included in any determination of the Retained Excess
Cash Flow Amount;
(vi)
payments or distributions to dissenting stockholders pursuant to applicable law, pursuant to or in connection with a consolidation, merger
or transfer of all or substantially all of the assets of the Borrower and its Restricted Subsidiaries that complies with the provisions of Section 6.03;
(vii)
any Restricted Subsidiary may declare or make a Restricted Payment with respect to the Equity Interests of such Restricted Subsidiary to
the Borrower or any other Restricted Subsidiary (and, in the case of a Restricted Subsidiary that is not a Wholly Owned Subsidiary, to each owner of Equity
Inter- ests of such Restricted Subsidiary such that the Borrower or Restricted Subsidiary receives at least its pro rata share of such dividend or distribution);
(viii)
Restricted Payments in an aggregate amount not to exceed in any fiscal year the greater of (x) $50,000,000 and (y) 10.0% of
Consolidated EBITDA for the then most recently ended Test Period less any Investments made under this clause pursuant to Section 6.11(t); provided that after
giving effect thereto on a pro forma basis (i) no Default shall have occurred and be continuing and (ii) the Consolidated Net Leverage Ratio is equal to or less
than 4.50 to 1.00;
(ix)
Restricted Payments up to an aggregate amount not to exceed $100,000,000 less any In- vestments made under this clause pursuant to
Section 6.11(t);
(x)
Restricted Payments so long as after giving effect thereto on a pro forma basis, (i)(x) pri- or to the Term B-1 Loan Repayment Date, the
Secured Net Leverage Ratio is equal to or less than 2.00 to
1.00 and (y) on or after the Term B-1 Loan Repayment Date, the Consolidated Net Leverage Ratio is equal to or less than 3.50 to 1.00 and (ii) no Default shall
have occurred and be continuing;
(xi)
parent of the Borrower:
the Borrower and its Restricted Subsidiaries may make Restricted Payments to any member of the IAC Group that is a direct or indirect
(A)
the proceeds of which will be used to pay the consolidated, combined or similar income tax liability of such parent’s income tax
group that is attributable to the income of the Bor- rower or its subsidiaries; provided that (x) no such payments with respect to any taxable year shall
exceed the amount of such income tax liability that would have been imposed on the Borrower and/or the applicable Subsidiaries had such entity(ies)
filed on a stand-alone basis and (y) any such payments attributable to an Unrestricted Subsidiary shall be limited to the amount of any cash paid by
such Unrestricted Subsidiary to the Borrower or any Restricted Subsidiary for such purpose;
(B)
the proceeds of which shall be used to pay such equity holder’s operating costs and expenses, other overhead costs and expenses
and fees, in each case, which are directly at- tributable to the ownership or operations of the Borrower and its subsidiaries; or
(C)
the proceeds of which shall be used to pay customary salary, bonus and other benefits payable to, and indemnities provided on
behalf of, officers and employees of any direct or
89
indirect parent of the Borrower to the extent such salaries, bonuses, other benefits and indemnities are directly attributable to the ownership or
operation of the Borrower and its Restricted Subsidiaries;
(xii)
any Junior Debt Restricted Payments; provided that, at the time of, and after giving effect thereto on a pro forma basis (x) no
Default shall have occurred and be continuing and (y) the Borrower shall be in compliance with Section 6.10 as of the end of the most recently ended Test
Period;
(xiii)
Restricted Payments in connection with the Match Transactions; and
(xiv)
prior to the Term B-1 Loan Repayment Date, Restricted Payments in an amount not to exceed the portion of the Retained Excess
Cash Flow Amount on the date of such election that the Borrow- er elects to apply to this Section 6.05(xiv) in a written notice of a Responsible Officer
thereof, which notice shall set forth the Retained Excess Cash Flow Amount (and the calculation thereof in reasonable detail) immediately prior to such
election and the amount thereof elected to be so applied; provided that after giving effect thereto on a pro forma basis (i) no Default shall have occurred and
be continuing and (ii) the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00.
SECTION 6.06 Transactions with Affiliates . The Borrower will not, and will not permit any of its Re- stricted Subsidiaries to, sell, lease or otherwise
transfer any property or assets to, or purchase, lease or otherwise acquire any property or assets from, or otherwise engage in any other transactions (including
amendments or modifications to prior or existing transactions) with, any of its Affiliates involving payment or consideration in excess of $5,000,000, except:
(a)
for transactions at prices and on terms and conditions not less favorable to the Borrower or such Restricted Subsidiary than could be
obtained on an arm’s-length basis from unrelated third parties, as determined by the Borrower;
(b)
(c)
transactions between or among the Borrower and its Restricted Subsidiaries not involving any other Affiliate;
pursuant to, as determined by the Borrower, reasonable director, officer and employee compensation (including bonuses) and other
benefits (including retirement, health, and stock compensation plans) and indemnification arrangements and performance of such arrangements;
(d)
(e)
(f)
(g)
any Restricted Payment permitted by Section 6.05;
ordinary course overhead arrangements in which any Restricted Subsidiary or Unrestricted Subsidiary participates;
any Investment permitted by Section 6.11;
(x) any agreement or arrangement in effect on the Closing Date and any amendment or replacement thereof that is not more
disadvantageous to the Lenders in any material respect than the agreement or arrangement in effect on the Closing Date; or (y) any transaction pursuant to
any agreement or arrangement referred to in the immediately preceding clause (x).
(h)
any transaction with a joint venture or similar entity which would be subject to this Sec- tion 6.06 solely because the Borrower or a
Restricted Subsidiary owns an equity interest in or otherwise controls such joint venture or similar entity;
(i)
any transaction entered into by a Person prior to the time such Person becomes a Restricted Subsidiary or is merged or consolidated
with or into the Borrower or a Restricted Subsidiary;
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Interests;
(j)
(k)
(l)
any transaction with an Affiliate where the only consideration paid by the Borrower or any Restricted Subsidiary is Qualified Equity
the issuance or sale of any Qualified Equity Interests;
any issuance of securities, or other payments, awards or grants in cash, securities or oth- erwise, in each case pursuant to, or the
funding of, employment arrangements, stock options and stock ownership plans in the ordinary course of business;
(m)
any employment agreements entered into by the Borrower or any of its Restricted Subsidiaries in the ordinary course of business and
the transactions pursuant thereto;
(n)
transactions between any one or more members of the IAC Group and any one or more members of the Match Group in connection
with the Match Transactions; and
(o)
transactions with an Escrow Borrower, including any Escrow Assumption and the en- trance into any agreements related thereto so
long as no Default or Event of Default shall have occurred and be continuing or would result therefrom.
SECTION 6.07 Changes in Fiscal Periods . The Borrower will not, and will not permit any of its Re- stricted Subsidiaries to, change its fiscal year to
end on a day other than December 31 or change its method of de- termining fiscal quarters.
SECTION 6.08 Sales and Leasebacks . The Borrower will not, and will not permit any of its Restricted Subsidiaries to, enter into any arrangement with
any Person (other than the Borrower or a Restricted Subsidiary) providing for the leasing by the Borrower or any Restricted Subsidiary of real or personal property
that has been or is to be sold or transferred by the Borrower or any Restricted Subsidiary to such Person or to any other Person to whom funds have been or are to be
advanced by such Person on the security of such property or rental obligations of the Borrower or any Restricted Subsidiary unless (i) the lease in such arrangement
is a capital lease and such capital lease may be entered into at such time pursuant to Section 6.01 and 6.02 or (ii) the lease in such arrangement is not a capital lease
and the aggregate proceeds from such arrangement and other such arrangements since the Closing Date do not exceed the greater of $15,000,000 and 3.0% of
Consolidated EBITDA after giving effect thereto on a pro forma basis for the then most recently ended Test Period for which financial statements have been
delivered pursuant to Section 5.01(a) or (b).
SECTION 6.09 Clauses Restricting Subsidiary Distributions . The Borrower will not, and will not per- mit any of its Restricted Subsidiaries to, directly
or indirectly, enter into or suffer to exist or become effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to (a) pay
dividends or make any other distributions on or in respect of its Equity Interests held by the Borrower or a Restricted Subsidiary, (b) make loans or advances or pay
any Indebtedness or other obligation owed to the Borrower or any Subsidiary Guarantor or (c) transfer any of its assets to the Borrower or any Subsidiary Guarantor,
except for such encumbrances or re- strictions existing under or by reason of:
(i) any encumbrances or restrictions existing under this Agreement and the other Loan Documents;
(ii)
encumbrances or restrictions with respect to a Restricted Subsidiary imposed pursuant to an agreement that has been entered into in
connection with the Disposition of all or substantially all of the capital stock or assets of such Restricted Subsidiary;
(iii)
encumbrances or restrictions under any agreement governing Capital Lease Obligations secured by Liens permitted by Section 6.02,
so long as such restrictions apply only to the assets subject to such Liens or relating to such Capital Lease Obligations, as the case may be;
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(iv)
(v)
encumbrances or restrictions under any agreement listed on Schedule 6.09 as in effect on the Closing Date;
encumbrances or restrictions under any agreement of any Person that becomes a Restrict- ed Subsidiary after the Closing Date that existed
prior to the time such Person became a Restricted Subsidiary; provided that such restrictions are not created in contemplation of or in connection with such
acquisition;
(vi)
any other instrument or agreement entered into after the Closing Date that contains en- cumbrances and restrictions that, as determined by
the Borrower, will not materially adversely affect the Borrower’s ability to make payments on the Loans;
(vii)
encumbrances or restrictions existing under or by reason of applicable law, regulation or order;
(viii)
(ix)
non-assignment provisions of any contract or lease entered into in the ordinary course of business;
encumbrances or restrictions imposed under any agreement to sell assets, including Qual- ified Equity Interests of such Restricted
Subsidiary, permitted under this Agreement to any Person pending the closing of such sale;
(x)
encumbrances or restrictions relating to any Lien permitted under this Agreement im- posed by the holder of such Lien that limit the right
of the relevant obligor to transfer assets that are subject to such Lien;
(xi)
encumbrances or restrictions relating to any Lien on any asset or property at the time of acquisition of such asset or property by the
Borrower or any Restricted Subsidiary;
(xii)
customary provisions in partnership agreements, limited liability company organizational governance documents, joint venture
agreements, shareholder agreements and other similar agreements that restrict the transfer of ownership interests in such partnership, limited liability company,
joint venture, corporation or similar Person;
(xiii)
encumbrances or restrictions on cash or other deposits or net worth imposed by suppliers, customers or landlords under contracts entered
into in the ordinary course of business;
(xiv)
Indebtedness incurred in compliance with Section 6.01(c) that imposes restrictions of the nature described in clause (c) above on the
assets acquired;
(xv)
with respect to clause (c) only, any encumbrance or restriction consisting of customary nonassignment provisions in leases governing
leasehold interests, licenses, joint venture agreements and agreements similar to any of the foregoing to the extent such provisions restrict the transfer of the
property subject to such leases, licenses, joint venture agreements or similar agreements;
(xvi)
with respect to clause (c) only, any encumbrance or restriction contained in security agreements or mortgages securing Indebtedness of a
Restricted Subsidiary to the extent such encumbrance or restriction restricts the transfer of the property subject to such security agreements or mortgages;
(xvii)
any encumbrances or restrictions imposed by any amendments, modifications, restate- ments, renewals, increases, supplements,
refundings, replacements or refinancings of the contracts, agree- ments, instruments or obligations referred to in this Section 6.09; provided that, as determined
by the Bor- rower, such amendments, modifications, restatements, renewals, increases, supplements, refundings, re- placements or refinancings (a) are not
materially more restrictive with respect to such encumbrances and restrictions than those prior to such amendments, modifications, restatements, renewals,
increases, supple-
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ments, refundings, replacements or refinancings or (b) will not materially adversely affect the Borrower’s ability to make payments on the Loans;
(xviii)
encumbrances or restrictions imposed by the Senior Notes; and
(xix)
encumbrances or restrictions imposed on any member of the Match Group in connection with the Match Transactions.
SECTION 6.10 Consolidated Net Leverage Ratio; Interest Coverage Ratio . For so long as Revolving Commitments, Revolving Loans or LC Exposure
remain outstanding, with respect to the Revolving Facility only, the Borrower will not permit the Consolidated Net Leverage Ratio as of the last day of any Test
Period to be more than 5.00 to 1.00. For so long as Revolving Commitments, Revolving Loans or LC Exposure remain outstanding, with respect to the Revolving
Facility only, the Borrower will not permit the Interest Coverage Ratio as of the last day of any Test Period to be less than 2.50 to 1.00
SECTION 6.11 Investments . The Borrower will not, and will not permit any of its Restricted Subsidi- aries to, make any advance, loan, extension of
credit (by way of Guarantee or otherwise) or capital contribution to, or purchase any Equity Interests, bonds, notes, debentures or other debt securities of, or any
assets constituting a business unit of, or incur any Unrestricted Subsidiary Support Obligations with respect to, any other Person (all of the foregoing, “ Investments
”) except:
(a)
(b)
(c)
extensions of trade credit and credit to customers in the ordinary course of business;
Investments in cash and Cash Equivalents and Investments that were Cash Equivalents when made;
loans and advances to directors, employees and officers of the Borrower or any Restricted Subsidiary in the ordinary course of
business (including for travel, entertainment and relocation expenses) in an aggregate principal amount for the Borrower and its Restricted Subsidiaries not
to exceed
$10,000,000 at any one time outstanding;
(d)
(e)
Investments made by the Borrower or any Restricted Subsidiary in the Borrower or any Restricted Subsidiary;
Investments (other than Investments directly or indirectly in Unrestricted Subsidiaries) made at any time if, after giving pro forma
effect thereto, (i) the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00 and (ii) no Default shall have occurred and be continuing;
(f)
any Investment existing on, or made pursuant to binding commitments existing on, the Closing Date and disclosed to the Lenders in
writing on the Closing Date;
(g)
(h)
Investments not prohibited by Section 6.05;
Investments in Unrestricted Subsidiaries in an aggregate amount not to exceed (x) prior to the Term B-1 Loan Repayment Date,
$50,000,000 and (y) on or after the Term B-1 Loan Repayment Date, $150,000,000, in each case, in any fiscal year (with unused amounts in any fiscal year
being carried over to succeeding fiscal years up to an aggregate amount not to exceed (i) prior to the Term B-1 Loan Re- payment Date, $150,000,000 and
(ii) on or after the Term B-1 Loan Repayment Date, $450,000,000, in each case, in any one fiscal year), determined net of any cash recoveries actually
received in respect of such Investments (it being understood that, if an Unrestricted Subsidiary becomes a Restricted Subsidiary, there will be deemed to
have occurred a cash recovery of all Investments made in such subsidiary on or after the Closing Date); provided that after giving pro forma effect to each
such Investment, no Default shall have occurred and be continuing;
(i)
Guarantees not prohibited by Section 6.01;
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(j)
Investments to the extent that payment for such Investments is made with Qualified Equity Interests of the Borrower; provided that the
issuance of such Equity Interests are not included in any determination of the Retained Excess Cash Flow Amount;
(k)
accounts, chattel paper and notes receivable arising from the sale or lease of goods or the performance of services in the ordinary
course of business;
(l)
Investments received in connection with the bankruptcy or reorganization of suppliers and customers and in settlement of delinquent
obligations of, and other disputes with, suppliers and cus- tomers arising in the ordinary course of business;
(m)
Investments, including in joint ventures of the Borrower or any Restricted Subsidiary, in an amount not to exceed at any one time
outstanding the greater of $50,000,000 or 2.00% of Total Assets;
(n)
Investments arising out of the receipt by the Borrower or a Restricted Subsidiary of non- cash consideration for the sale of assets
permitted under Section 6.04;
(o)
Guarantees by the Borrower or any Restricted Subsidiary of operating leases (other than Capital Lease Obligations) or of other
obligations that do not constitute Indebtedness, in each case entered into by the Borrower or Restricted Subsidiary in the ordinary course of business;
(p)
(q)
lease, utility and other similar deposits in the ordinary course of business;
to the extent constituting Investments, the Match Transactions;
(r)
Investments by the Borrower and its Restricted Subsidiaries in any Escrow Borrower for purposes of funding original issue discount,
upfront fees, redemption or repayment premium and interest with respect to any Escrow Permitted Ratio Debt or Escrow Incremental Term Loans, in each
case, to the extent such Escrow Permitted Ratio Debt and/or such Escrow Incremental Term Loans are incurred in connection with the Match Transactions;
provided that after giving pro forma effect to such Investment, no Default shall have occurred and be continuing;
(s)
prior to the Term B-1 Loan Repayment Date, Investments in an amount not to exceed the portion of the Retained Excess Cash Flow
Amount on the date of such election that the Borrower elects to apply to this Section 6.11(s) in a written notice of a Responsible Officer thereof, which
notice shall set forth the Retained Excess Cash Flow Amount (and the calculation thereof in reasonable detail) immediately prior to such election and the
amount thereof elected to be so applied; provided that after giving effect thereto on a pro forma basis (i) no Default shall have occurred and be continuing
and (ii) the Consolidated Net Leverage Ratio is equal to or less than 4.50 to 1.00; and
(t)
prior to the Term B-1 Loan Repayment Date, Investments by the Borrower and its Re- stricted Subsidiaries, if the Borrower or any
Restricted Subsidiary would otherwise be permitted to make a Restricted Payment under Section 6.05(viii), (ix) or (x) in such amount; provided that the
amount of any such Investment shall be deemed to be a Restricted Payment under the applicable clause for all purposes under this Agreement).
SECTION 6.12 Activities of Match Group, Inc. Match Group, Inc. (i) shall not engage in any material operational activity other than (1) the ownership of
Equity Interests in its subsidiaries or entities that become its subsidiaries (or, indirectly through its subsidiaries, other Equity Interests in accordance with clause (ii)
below) and activities incidental thereto, including making Investments in its subsidiaries or entities that become its subsidiaries and owing Indebtedness to its
subsidiaries, (2) activities in connection with the Transactions and the Match Transactions, (3) corporate maintenance activities and incurring fees, costs and
expenses relating to overhead and general operating including professional fees for legal, tax and accounting issues and paying taxes, (4) the performance of its
obligations and rights under and in connection with the Loan Documents and Transactions, any documentation governing any Indebtedness or Guarantee and the
other agreements contemplated hereby, (5) providing indemnification
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to officers, employees and members of the Board of Directors of the Borrower and boards of directors and officers and employees of its subsidiaries, (6) the
performing of activities in preparation for and consummating any public offering of its common stock or any other issuance or sale of its Equity Interests, (7)
activities that arise as a result of its status as a public company and a SEC registrant, (8) repurchases of Indebtedness through open market purchases or Dutch
Auctions permitted under this Agreement and (9) activities otherwise permitted pursuant to this Section 6.12, (ii) shall not own or acquire any material assets (other
than Equity Interests of its subsidiaries, Indebtedness through open market purchases or Dutch Auctions permitted hereunder and cash and Cash Equivalents), (iii)
may engage in financing activities, including the incurrence of Indebtedness, issuance of equity, payment of Restricted Payments, contribution to the capital of its
subsidiaries and guarantee the obligations of its subsidiaries in each case as otherwise not prohibited hereunder, (iv) may participate in tax, accounting and other
administrative matters as a member of the Match Group and as a subsidiary of IAC, (v) may engage in any activities required by law, rule or regulation (or any
activities in connection with, or that arise as part of, any litigation) and (vi) may engage in activities incidental or reasonably related to the foregoing.
ARTICLE VII
Events of Default
SECTION 7.01 Events of Defaul t. If any of the following events ( “Ev ents of Defaul t”) shall occur:
(a)
the Borrower shall fail to pay any principal of any Loan when and as the same shall be- come due and payable, whether at the due date
thereof or at a date fixed for prepayment thereof or other- wise;
(b)
the Borrower shall fail to pay any interest on any Loan or any fee or any other amount (other than an amount referred to in clause (a)
of this Section 7.01) payable under this Agreement, when and as the same shall become due and payable, and such failure shall continue unremedied for a
period of five Business Days;
(c)
any representation or warranty made or deemed made by or on behalf of the Borrower or any other Loan Party in this Agreement or
any other Loan Document or any amendment, modification or waiver in respect thereof, or in any certificate furnished pursuant to this Agreement or any
other Loan Document or any amendment, modification or waiver in respect thereof, shall prove to have been incorrect in any material respect when made or
deemed made;
(d)
any Loan Party shall fail to observe or perform any covenant, condition or agreement contained in Section 5.02, 5.03 (with respect to
the Borrower’s existence) or 5.08 or in Article VI; provided that unless any Incremental Term Facility expressly provides otherwise, the Borrower’s failure
to perform or observe the covenants set forth in Section 6.10 shall not constitute an Event of Default for purposes of any Term Facilities unless and until the
Required Revolving Lenders have actually declared all such obligations to be immediately due and payable in accordance with the Loan Documents and
such declaration has not been rescinded on or before the date on which the Lenders in respect of the Incremental Term Facilities declare an Event of Default
in connection therewith (the “ Term Loan Standstill Period ”);
(e)
any Loan Party shall fail to observe or perform any covenant, condition or agreement contained in this Agreement or any other Loan
Document to which it is a party (other than those specified in clause (a), (b), (c) or (d) of this Section 7.01), and such failure shall continue unremedied for a
period of 30 days after written notice thereof from the Administrative Agent to the Borrower (which notice will be given at the request of any Lender);
(f)
the Borrower or any Restricted Subsidiary shall fail to make any payment (whether of principal or interest and regardless of amount) in
respect of any Material Indebtedness, when and as the same shall become due and payable after any applicable grace period therefor;
95
(g)
any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or that enables or
permits (with or without the giving of notice) the holder or holders of any Material Indebtedness or any trustee or agent on its or their behalf to cause any
Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity; provided
that this clause (g) shall not apply to secured Indebtedness that be- comes due as a result of the voluntary sale or transfer of the property or assets securing
such Indebtedness;
(h)
an involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other
relief in respect of the Borrower or any Material Subsidiary or its debts, or of a substantial part of its assets, under any Federal, state or foreign bankruptcy,
insolvency, receivership or similar law now or hereafter in effect or (ii) the appointment of a receiver, trustee, custodi- an, sequestrator, conservator or
similar official for the Borrower or any Material Subsidiary or for a sub- stantial part of its assets, and, in any such case, such proceeding or petition shall
continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;
(i)
the Borrower or any Material Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking liquidation,
reorganization or other relief under any Federal, state or foreign bankruptcy, insolvency, receivership or similar law now or hereafter in effect, (ii) consent
to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or petition described in clause (h) of this Section 7.01, (iii) apply
for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Borrower or any Restricted Subsidiary
or for a substantial part of its assets, (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding, (v) make a
general assignment for the benefit of creditors or (vi) take any action for the purpose of effecting any of the foregoing;
(j)
one or more judgments for the payment of money in an aggregate amount in excess of
$50,000,000 (to the extent not adequately covered by insurance) shall be rendered against the Borrower, any Material Subsidiary or any combination
thereof and the same shall remain undischarged for a period of 60 consecutive days during which execution shall not be effectively stayed;
(k)
an ERISA Event shall have occurred that, when taken together with all other ERISA Events that have occurred, would reasonably be
expected to result in a Material Adverse Effect;
(l)
at any time, the Pledge Agreement shall cease, for any reason, to be in full force and ef- fect, or any Loan Party shall so assert in
writing, or any material Lien created by the Pledge Agreement shall cease to be enforceable and of the same effect and priority purported to be created
thereby (except, in each case, as permitted under the Loan Documents);
(m)
this Agreement or the Guarantee Agreement shall cease, for any reason, to be in full force and effect, or any Loan Party shall so
assert in writing, except as permitted under the Loan Documents; or
(n)
Change of Control shall occur;
then, and in every such event (other than an event with respect to the Borrower described in clause (h) or (i) of this Section 7.01), and at any time thereafter during
the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders (or, unless any Incremental Term Facility provides
otherwise, to the extent such Event of Default solely comprises an Event of Default arising from the Borrower’s failure to perform or observe the covenants set forth
in Section 6.10, prior to the expiration of the Term Loan Standstill Period, at the request of the Required Revolving Lenders only, and in such case only with respect
to the Revolving Commitments, Revolving Loans and any Letters of Credit) shall, by notice to the Borrower, take any or all of the following actions, at the same or
different times: (i) terminate the Revolving Commitments, and thereupon the Revolving Commitments shall terminate immediately, (ii) declare the Loans then
outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and
payable during the continuation of such event) by the Borrower, and thereupon the principal of the Loans so declared to be due and payable, together with accrued
interest thereon and all fees and other obligations of the Borrower accrued
96
hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind (other than notice from the Administrative
Agent), all of which are hereby waived by the Borrower and (iii) require all outstanding Letters of Credit to be cash collateralized in accordance with Section
2.17(k); and in case of any event with respect to the Borrower described in clause (h) or (i) of this Section 7.01, the Revolving Commit- ments shall automatically
terminate and the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of the Borrower accrued
hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by the
Borrower.
ARTICLE VIII
The Administrative Agent
SECTION 8.01 Appointment and Authorization . Each of the Lenders hereby irrevocably appoints the Administrative Agent as its agent 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 and the
other Loan Docu- ments, together with such actions and powers as are reasonably incidental thereto.
SECTION 8.02 Administrative Agent and A f filiates . The bank serving as the Administrative Agent hereunder shall have the same rights and powers in
its capacity as a Lender as any other Lender and may exercise the same as though it were not the Administrative Agent, and such bank and its Affiliates may accept
deposits from, lend money to and generally engage in any kind of business with the Borrower or any Restricted Subsidiary or other Affiliate thereof as if it were not
the Administrative Agent hereunder.
SECTION 8.03 Action by Administrative Agent . The Administrative Agent shall not have any duties or obligations except those expressly set forth
herein and the other Loan Documents. Without limiting the generali- ty of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other
implied duties, regard- less of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary
action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby that the Administrative Agent is required to
exercise in writing as directed by the Required Lenders (or such other number or percentage of the Lenders as shall be necessary under the circumstances as pro-
vided in Section 9.02 or 9.03), and (c) except as expressly set forth herein, the Administrative Agent shall not have any duty to disclose, and shall not be liable for
the failure to disclose, any information relating to the Borrower or any of its Restricted Subsidiaries that is communicated to or obtained by the bank serving as
Administrative Agent or any of its Affiliates in any capacity. The Administrative Agent shall not be liable for any action taken or not tak- en by it with the consent
or at the request of the Required Lenders (or such other number or percentage of the Lend- ers as shall be necessary under the circumstances as provided in Section
9.02 or 9.03) or otherwise, in the absence of its own gross negligence or willful misconduct. The Administrative Agent shall be deemed not to have knowledge of
any Default unless and until written notice thereof is given to the Administrative Agent by the Borrower or a Lender, and the Administrative Agent shall not be
responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other
Loan Docu- ment, (ii) the contents of any certificate, report or other document delivered under or in connection with this Agree- ment or any other Loan Document,
(iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or in any other Loan Document, (iv) the
validity, enforceability, effectiveness or genuineness of this Agreement, the other Loan Documents or any other agreement, instrument or document, or (v) the
satisfaction of any condition set forth in Article IV or elsewhere herein or in any other Loan Document, other than to confirm receipt of items expressly required to
be delivered to the Administrative Agent.
SECTION 8.04 Consultation with Experts . The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon,
any notice, request, certificate, consent, statement, instrument, document or other writing believed by it to be genuine and to have been signed or sent by the proper
Person. The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall
not incur any liability for relying thereon. The Administrative Agent may con- sult with legal counsel (who may be counsel for the Borrower), independent
accountants and other experts selected
97
by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such coun- sel, accountants or experts.
SECTION 8.05 Delegation of Duties . The Administrative Agent may perform any and all its duties and exercise its rights and powers by or through any
one or more sub-agents appointed by the Administrative Agent. The Administrative Agent and any such sub-agent may perform any and all its duties and exercise its
rights and powers through their respective Related Parties. The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the
Related Parties of the Administrative Agent and any such sub-agent, and shall ap- ply to their respective activities in connection with the syndication of the credit
facilities provided for herein as well as activities as Administrative Agent.
SECTION 8.06 Successor Administrative Agent . Subject to the appointment and acceptance of a suc- cessor Administrative Agent as provided in this
paragraph, the Administrative Agent may resign at any time by noti- fying the Lenders and the Borrower. Upon any such resignation, the Required Lenders shall
have the right, in con- sultation with the Borrower, to appoint a successor. If no successor shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days after the retiring Administrative Agent gives no- tice of its resignation, then the retiring Administrative Agent may, on
behalf of the Lenders, appoint a successor Administrative Agent which shall be a bank with an office in New York, New York, or an Affiliate of any such bank.
Upon the acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights,
powers, privileges and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations
hereunder. The fees payable by the Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed
between the Borrower and such successor. After the Administrative Agent’s resignation hereunder, the provisions of this Article and Section 9.04 shall continue in
effect for the benefit of such retiring Ad- ministrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken
by any of them while it was acting as Administrative Agent.
SECTION 8.07 Credit Decision . Each Lender acknowledges that it has, independently and without re- liance upon the Administrative Agent or any
other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.
Each Lender also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents
and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this
Agreement, any other Loan Document, any related agreement or any document furnished hereunder or thereunder.
SECTION 8.08 Lead Arrangers; Syndication Agent; Co-Documentation Agents . Notwithstanding any- thing to the contrary herein, none of the Lead
Arrangers, the Syndication Agent or Co-Documentation Agents shall have any powers, duties or responsibilities under this Agreement or any of the other Loan
Documents, except in its capacity, if applicable, as the Administrative Agent, the Collateral Agent, a Lender or an Issuing Bank. Each Lender acknowledges that it
has not relied, and will not rely, on any of the Lead Arrangers, the Syndication Agent or the Co-Documentation Agents in deciding to enter into this Agreement or
any other Loan Document or in taking or not taking any action hereunder or thereunder.
SECTION 8.09 Tax Indemnification by the Lenders . To the extent required by any applicable Re- quirements of Law, the Administrative Agent may
withhold from any payment to any Lender an amount equivalent to any applicable withholding Tax. Without limiting or expanding the provisions of Section 2.14,
each Lender shall indemnify and hold harmless the Administrative Agent against, and shall make payable in respect thereof within 10 days after demand therefor,
any and all Taxes and any and all related losses, claims, liabilities and expenses (includ- ing fees, charges and disbursements of any counsel for the Administrative
Agent) incurred by or asserted against the Administrative Agent by the Internal Revenue Service or any other Governmental Authority as a result of the failure of the
Administrative Agent to properly withhold Tax from amounts paid to or for the account of such Lender for any reason (including, without limitation, because the
appropriate form was not delivered or not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstance that
rendered the exemption from, or reduction of withholding Tax ineffective). A certificate as to the amount of such payment or liability delivered to any Lender by the
Administrative Agent shall be conclusive absent manifest error. Each Lender
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hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under this Agreement or any other Loan
Document against any amount due the Administrative Agent under this Section 8.09. The agreements in this Section 8.09 shall survive the resignation and/or
replacement of the Ad- ministrative Agent, any assignment of rights by, or the replacement of, a Lender, the termination of the commit- ments and the repayment,
satisfaction or discharge of all other Obligations.
ARTICLE IX
Miscellaneous
SECTION 9.01 Notices .
(a)
All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing (including by telecopy) (unless
otherwise specifically permitted in this Agreement), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when
delivered, or three Business Days after being deposited in the mail, postage prepaid, or, in the case of telecopy or telephone notice, when received, addressed as
follows in the case of the Borrower and the Administrative Agent, and as set forth in an administrative questionnaire delivered to the Administrative Agent in the
case of the Lenders, or to such other address as may be hereafter notified by the respective parties hereto:
Borrower: Match Group, Inc.
555 West 18th Street New York, NY 10011 Chief Financial Officer
Telephone: (212) 314-7210
Fax: (212) 632-9529
With a copy to: Match Group, Inc.
555 West 18th Street New York, NY 10011 General Counsel
Telephone: (212) 314-7376
Fax: (212) 632-9551
Administrative Agent: JPMorgan Chase Bank, N.A.
500 Stanton Christiana Road Ops Building 2, 3 rd Floor Newark, DE 19713-2107
Christopher Jackson Telephone: (302) 634-1198
Fax: (302) 634-1417
and
J.P. Morgan Europe Limited Loans Agency, 6th floor
25 Bank Street, Canary Wharf London E145JP
United Kingdom Attention: Loans Agency
Telephone: +44 20 7134 8188
Fax: +44 20 7777 2360
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With a copy to: JPMorgan Chase Bank, N.A.
383 Madison Avenue, 24 th Floor New York, New York 10179 Attention: Donatus Anusionwu Telephone: (212) 622-
0531
Fax: (212) 270-5127
(b)
Notices, financial statements and similar deliveries and other communications to the Lenders hereunder may be delivered or furnished by
electronic communications pursuant to procedures approved by the Administrative Agent (including by posting on IntraLinks); provided that the foregoing shall not
apply to notices pursuant to Article II unless otherwise agreed by the Administrative Agent and the applicable Lender. The Admin- istrative Agent or the Borrower
may, in its discretion, agree to accept notices and other communications to it here- under by electronic communications pursuant to procedures approved by it,
provided that approval of such proce- dures may be limited to particular notices or communications.
SECTION 9.02 Waivers; Amendments .
(a)
No failure or delay by the Administrative Agent or any Lender in exercising any right or power hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights and remedies of the Administrative Agent and the Lenders hereunder are cumulative
and are not exclusive of any rights or remedies that they would otherwise have. No waiver of any provision of this Agreement or consent to any departure by the
Borrower therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or con- sent shall be
effective only in the specific instance and for the purpose for which given. Without limiting the gener- ality of the foregoing, the making of a Loan shall not be
construed as a waiver of any Default, regardless of whether the Administrative Agent or any Lender may have had notice or knowledge of such Default at the time.
(b)
Neither this Agreement nor any provision hereof may be waived, amended, amended and restated or modified except as provided in Sections
2.02, 2.19 and 2.20 or pursuant to an agreement or agreements in writing entered into by the Borrower and the Required Lenders or by the Borrower and the
Administrative Agent with the consent of the Required Lenders; provided that no such agreement shall (i) increase the Commitment of any Lender without the
written consent of such Lender, (ii) reduce the principal amount of any Loan or reduce the rate of inter- est thereon, or reduce any fees payable hereunder, without
the written consent of each Lender directly affected thereby, (iii) postpone the scheduled date of payment of the principal amount of any Loan, or any interest
thereon, or any fees payable hereunder, or reduce the amount of, waive or excuse any such payment, or postpone the scheduled date of expiration of any
Commitment, without the written consent of each Lender directly affected thereby (it being understood that the waiver of (or amendment to the terms of) any
mandatory prepayment of Term Loans shall not constitute a postponement of any date scheduled for the payment of principal or interest), (iv) change Section 2.15 in
a manner that would alter the pro rata distribution or sharing of payments required thereby or any provision requir- ing the pro rata funding of Loans, without the
written consent of each Lender, (v) except as provided in Section 9.16, release all or substantially all of the Collateral securing the Obligations or all or substantially
all of the value of the Guarantees provided by the Guarantors taken as a whole without the written consent of each Lender, (vi) change any of the provisions of this
Section or the definition of “Required Lenders,” “Required Revolving Lenders” or any other provision hereof specifying the number or percentage of Lenders
required to waive, amend or modify any rights hereunder or make any determination or grant any consent hereunder, without the written consent of each Lender;
provided that such provisions may be amended or amended and restated pursuant to the establishment of Incremental Term Loans pursuant to Section 2.02 in order
to restrict affiliated lenders and other persons from being included in such definitions or (vii) change the definition of “Alternative Currency,” without the written
consent of each Lender; provided , further , that no such agreement shall amend, modify or otherwise affect the rights or duties of the Administrative Agent or any
Issuing Bank hereunder without the prior written consent of the Administrative Agent or such Issuing Bank, as the case may be.
(c)
Notwithstanding the foregoing, technical and conforming modifications to the Loan Documents may be made (including by amendment and
restatement) with the consent of the Borrower and the Administrative
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Agent (but without the consent of any Lender) to the extent necessary (A) to effectuate any Incremental Facilities, Replacement Revolving Facility Commitments,
Replacement Revolving Loans, Extended Revolving Commitments and Extended Revolving Loans in a manner consistent with Sections 2.02, 2.19 and 2.20 and as
may be necessary to establish such Incremental Facilities, Extended Revolving Commitments, Term Loans, Replacement Revolving Facility Commitments,
Replacement Revolving Loans or Extended Revolving Loans as a separate Class or tranche from any existing Term Loans, Revolving Commitments or Revolving
Loans, as applicable, and, in the case of Ex- tended Term Loans, to reduce the amortization schedule of the related existing Class of Term Loans proportionately or
(B) to cure any ambiguity, omission, error, defect or inconsistency and, in each case under this clause (B), such amendment shall become effective without any
further action or consent of any other party to any Loan Document if the same is not objected to in writing by the Required Lenders within ten Business Days
following receipt of notice thereof.
(d)
Notwithstanding anything in this Agreement or the other Loan Documents to the contrary, unless otherwise set forth in any Incremental
Assumption Agreement, Extension Amendment or Refinancing Amendment with respect to the Class of Loans and Commitments established thereby, only the
consent of the Required Revolv- ing Lenders shall be necessary to (1) waive or consent to a waiver of an Event of Default under Section 7.01(d) (solely with respect
to Section 6.10) or (2) modify or amend Section 6.10 (including, in each case, the component definitions thereof, solely to the extent such definitions are used in
such Section (but not otherwise)) or this clause (d).
SECTION 9.03 Waivers; Amendments to Other Loan Documents .
(a)
No failure or delay by the Administrative Agent or any Lender in exercising any right or power under the Guarantee Agreement or the Pledge
Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to
enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power. The rights and remedies of the
Administrative Agent and the Lenders under the Guarantee Agreement and the Pledge Agreement are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of the Guarantee Agreement or the Pledge Agreement or consent to any departure by any Loan Party
therefrom shall in any event be effective unless the same shall be permitted by paragraph (b) of this Section, and then such waiver or consent shall be effective only
in the specific instance and for the purpose for which given.
(b)
Neither the Guarantee Agreement, the Pledge Agreement nor any provision thereof may be waived, amended. amended and restated or
modified except pursuant to an agreement or agreements in writing en- tered into by each affected Loan Party and, except as provided in Section 2.02, 2.19, 2.20,
9.02 or in the case of amendments to the Pledge Agreement described in Section 7.1(b) thereof, the Required Lenders or by the affected Loan Party and the
Administrative Agent with the consent of the Required Lenders; provided that no such agree- ment shall (i) release all or substantially all of the Collateral (except as
provided in Section 9.16), (ii) modify the “waterfall” provisions set forth in Section 5.3 of the Pledge Agreement, (iii) release all or substantially all of the Material
Domestic Subsidiaries as Subsidiary Guarantors (except as provided in Section 9.16) or (iv) change any of the provisions of this Section, in each case without the
written consent of each Lender; provid ed, further , that no such agreement shall amend, modify or otherwise affect the rights or duties of the Collateral Agent under
the Guar- antee Agreement or the Pledge Agreement without the prior written consent of the Collateral Agent.
(c)
Without the consent of any Lender, the Loan Parties and the Administrative Agent and the Collateral Agent may (in their respective sole
discretion, or shall, to the extent required by any Loan Document) enter into any amendment, modification, supplement or waiver of any Loan Document, or enter
into any new agreement or instrument, to effect the granting, perfection, protection, expansion or enhancement of any security interest in any Collateral or additional
property to become Collateral for the benefit of the Secured Parties, and to give effect to any intercreditor agreement reasonably satisfactory to the Administrative
Agent associated therewith, or as required by local law to give effect to, or protect, any security interest for the benefit of the Secured Parties in any property or so
that the security interests therein comply with applicable law or this Agreement or in each case to otherwise enhance the rights or benefits of any Lender under any
Loan Document.
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SECTION 9.04 Expenses; Indemnity; Damage Waiver .
(a)
The Borrower shall pay (i) all reasonable out-of-pocket expenses incurred by the Administrative Agent, the Lead Arrangers and their
respective Affiliates, including the reasonable fees, charges and disbursements of counsel for the Administrative Agent and the Lead Arrangers, in connection with
the syndication of the Revolv- ing Facility and the preparation, execution, delivery and administration of this Agreement or any other Loan Docu- ment or any
amendments, modifications or waivers of the provisions hereof or thereof and (ii) all reasonable out-of- pocket expenses incurred by the Administrative Agent and
the Lenders, including the fees, charges and disbursements of one firm of counsel for the Administrative Agent and the Lenders taken as a whole (and in the case of
an actual or perceived conflict of interest, one additional counsel to all such affected Persons, taken as a whole), and to the extent required, one firm of local counsel
in each relevant jurisdiction (which may include a single special counsel acting in multiple jurisdictions) and one firm of regulatory counsel, in connection with the
enforcement or pro- tection of its rights in connection with this Agreement or any other Loan Document, including their rights under this Section, or in connection
with the Loans made hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans.
(b)
The Borrower shall indemnify the Administrative Agent, the Lead Arrangers and each Lender, and each Related Party of any of the foregoing
the execution or delivery of this Agreement, any other Loan Document or any agreement or instrument contem- plated hereby or thereby, the performance by
Persons (each such Person being called an “ Indemnitee ”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and
related expenses (including the reasonable and documented or invoiced out-of-pocket fees, expenses, disbursements and other charges of one firm of counsel for all
Indemnitees, taken as a whole (and, in the case of an actual or perceived conflict of interest where the Indemnitee affected by such conflict notifies the Borrower of
any existence of such conflict and in con- nection with the investigating or defending any of the foregoing has retained its own counsel, of another firm of counsel
for such affected Indemnitee), and to the extent required, one firm or local counsel in each relevant jurisdic- tion) and one firm of regulatory counsel of any such
Indemnitee, arising out of, in connection with, or as a result of
(i)
the parties to this Agreement or any other Loan Document of their respective obligations hereunder or thereunder or the consummation of the Transactions or any
other transactions contemplated hereby or thereby, (ii) any Loan or the use of the proceeds therefrom, (iii) any actual or alleged pres- ence or release of Hazardous
Materials on or from any property owned or operated by the Borrower or any of its Restricted Subsidiaries, or any Environmental Liability related in any way to the
Borrower or any of its Restricted Subsidiaries, (iv) any civil penalty or fine assessed by OFAC against, and all reasonable costs and expenses (includ- ing counsel
fees and disbursements) incurred in connection with defense thereof, by the Administrative Agent or any Lender as a result of conduct of the Borrower that violates
a sanction enforced by OFAC or (v) any actual or pro- spective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on
contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto or whether or not such action, claim, litigation or proceeding was
brought by the Borrower, its equity holders, affiliates or creditors or any other third person; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, liabilities or related expenses (i) are determined by a court of competent jurisdiction in a final and
nonappealable judgment to have resulted from the gross negligence, willful misconduct or bad faith of such Indem- nitee (or that of any of its respective subsidiaries
or any of their respective officers, directors, employees or mem- bers), (ii) are determined by a court of competent jurisdiction in a final and nonappealable judgment
to have resulted from a material breach of this Agreement by such Indemnitee or (iii) do not involve or arise from an act or omission by the Borrower or its
subsidiaries or any of their respective affiliates, partners, directors, officers, employees, agents, advisors or other representatives and is brought by an Indemnitee
solely against one or more other Indem- nitees (other than claims against any Agent or any Lead Arranger in its capacity as such or in its fulfilling such role). Each
Indemnitee shall give prompt notice to the Borrower of any claim that may give rise to a claim against the Bor- rower hereunder and shall consult with the Borrower
in the conduct of such Indemnitee’s legal defense of such claim; provided , however , than an Indemnitee’s failure to give such prompt notice to the Borrower or to
seek such consultation with the Borrower shall not constitute a defense to any claim for indemnification by such Indemnitee unless, and only to the extent that, such
failure materially prejudices the Borrower.
(c)
To the extent that the Borrower fails to pay any amount required to be paid by it to the Adminis- trative Agent under paragraph (a) or (b) of
this Section, each Lender severally agrees to pay to the Administrative Agent such Lender’s Total Percentage (determined as of the time that the applicable
unreimbursed expense or in-
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demnity payment is sought) of such unpaid amount; provided that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the
case may be, was incurred by or asserted against the Administra- tive Agent in its capacity as such.
(d)
To the extent permitted by applicable law, the parties shall not assert, and each hereby waives, any claim against any other party, on any theory
of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this
Agreement or any agreement or instrument contemplated hereby, the Transactions, any Loan or the use of the proceeds thereof; pro- vided that nothing in this clause
(d) is intended to relieve the Borrower of any obligation it may otherwise have to indemnify any Indemnitee against any special, indirect, consequential or punitive
damages asserted against such Indemnitee by a third party.
(e)
All amounts due under this Section shall be payable within ten (10) Business Days after written demand therefor.
SECTION 9.05 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 (i) the Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written
consent of each Lender (and any attempted assignment or transfer by the Borrower without such consent shall be null and void) and (ii) no Lender may assign or
otherwise transfer its rights or obligations hereunder except in accordance with this Section. 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 paragraph (c)
of this Section) and, to the extent expressly contemplated hereby, the Related Parties 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)
(i)Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more assignees ( “assi g nee” or “ assignees”)
all or a portion of its rights and obligations under this Agreement (including all or a portion of its Revolving Commitments and the Loans at the time owing to it)
with the prior written consent of:
(A)
the Borrower (such consent not to be unreasonably withheld or delayed, except for any bona fide competitors of the Borrower and its
subsidiaries); provided that no consent of the Borrower shall be required for an assignment (i) of a Term Loan Commitment or a Term Loan to a Lender, an
Affiliate of a Lender, an Approved Fund, (ii) of a Revolving Commitment or Revolving Loans to a Revolving Lender, an Affiliate of a Revolving Lender
or Approved Fund with respect to a Revolving Lender or (iii) if an Event of Default has occurred and is continuing, any other assignee (except for any bona
fide competitor of the Borrower and its subsid i aries);p rovided , further , that the Borrower shall be deemed to have consented to any such assignment
unless it shall object thereto by written notice to the Administrative Agent within five (5) Business Days after having received notice of the proposed
assignment;
(B)
the Administrative Agent (such consent not to be unreasonably withheld), provided that no consent of the Administrative Agent shall
be required for an assignment of any Revolving Commitment or Loan to an assignee that is a Lender, an Affiliate of a Lender or an Approved Fund; and
(C)
each Issuing Bank.
(ii)
Assignments shall be subject to the following additional conditions:
(A)
except in the case of an assignment to a Lender or an Affiliate of a Lender or an assign- ment of the entire remaining amount of the
assigning Lender’s Revolving Commitment or Loans of any Class, the amount of the Revolving Commitments or Loans of the assigning Lender subject to
each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent)
shall not be less than $10,000,000 (or in the case of a Loan in an Al-
103
ternative Currency, an appropriate corresponding amount as shall be consented to by the Administrative Agent (such consent not be unreasonable
withheld)), unless each of the Borrower and the Administrative Agent otherwise consent, provided that no such consent of the Borrower shall be required if
an Event of Default under clause (a), (b), (h) or (i) of Article VII has occurred and is continuing;
(B)
each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations
under this Agreement, provided that this clause shall not be con- strued to prohibit the assignment of a proportionate part of all the assigning Lender’s
rights and obligations in respect of its Revolving Commitments or Revolving Loans;
(C)
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 (which fee is hereby waived for any assignment to which J.P. Morgan Chase Bank, N.A. or any of its Affiliates is
a party);
(D)
(E)
Currencies; and
the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Ad- ministrative Questionnaire;
on the date of such assignment, the assignee of a Revolving Commitment must be able to fund Revolving Loans in all Alternative
(F)
the assignee shall not be (i) the Borrower or any of the Borrower’s Affiliates or Subsidiaries except in accordance with Section 2.21
and clause (e) below or (ii) a natural Person.
For the purposes of this Section 9.05(b), the term “ Approved Fund ” means any Person (other than a natural person) that is engaged in making, purchasing, holding
or investing in bank loans and similar extensions of credit in the or- dinary course of its business and that is administered or managed by (a) a Lender, (b) an
Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
(iii)
Subject to acceptance and recording thereof pursuant to paragraph (b)(v) of this Section, from and after the effective date specified in each
Assignment and Assumption the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and 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 2.12, 2.13, 2.14 and
9.04). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not com- ply with this Section 9.05 shall be null and void.
(iv)
The Administrative Agent, acting for this purpose as an agent of the Borrower, shall maintain at one of its offices 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 amount (and
related interest) of the Loans owing to, each Lender pursuant to the terms hereof from time to time (the “ Reg i ster”). The entries in the Register shall be conclusive
absent manifest error, and the Borrower, the Administrative Agent 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 in- spection by the
Borrower and any Lender (with respect to such Lender’s own interests only), at any reasonable time and from time to time upon reasonable prior notice.
(v)
Upon its receipt of a duly completed Assignment and Assumption with respect to a permitted assignment executed by an assigning Lender and
an assignee, the assignee’s completed Administrative Questionnaire (unless the assignee shall already be a Lender hereunder), the processing and recordation fee
referred to in paragraph of this Section (unless waived), and any written consent to such assignment required by paragraph (b) of this Section, the Administrative
Agent shall accept such Assignment and Assumption and record the information con-tained therein in the Register. No assignment shall be effective for purposes of
this Agreement unless it has been recorded in the Register as provided in this paragraph.
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(c)
(i) Any Lender may, without the consent of the Borrower or the Administrative Agent, sell partici- pations to one or more banks, institutions or
other entities (a “ Participant ”) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of its Commitments and
the Loans owing to it); provided that (A) such Lender’s obligations under this Agreement shall remain unchanged, (B) such Lender shall remain solely responsible
to the other parties hereto for the performance of such obligations and (C) the Borrower, the Administrative Agent and the other Lenders shall continue to deal solely
and directly with such Lender in con- nection with such Lender’s rights and obligations under this Agreement and the other Loan Documents. 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, modi- fication or waiver of any provision of this Agreement and the other Loan Documents; provided that such
agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amend- ment, modification or waiver described
in the first proviso to Section 9.02(b) or the first proviso to Section 9.03(b) that affects such Participant. Subject to paragraph (c)(ii) of this Section, the Borrower
agrees that each Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.14 (subject to the requirements and limitations of such Sections; provided
that any documentation required to be provided pursuant to Section 2.14(e) shall be provided solely to the participating Lender) to the same extent as if it were a
Lender and had acquired its interest by assign- ment pursuant to paragraph (b) of this Section.Each Lender that sells a participation shall, acting solely for this pur-
pose as a non-fiduciary agent of the Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and related
interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “ Participant Register ”); provided that no Lender shall have
any obligation to disclose all or any portion of the Participant Register (including the identity of any Participant or any information relating to a Participant’s interest
in any commitments, loans, letters of credit or its other obligations under any Loan Document) to any Person except to the extent that such disclosure is necessary in
connection with a Tax audit or other proceeding or other governmental inquiry to establish that such commitment, loan, letter of credit or other ob- ligation is in
registered form under Section 5f.103-1(c) of the United States Treasury Regulations. The entries in the Participant Register shall be conclusive absent manifest error,
and the parties hereto 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.
(ii) A Participant shall not be entitled to receive any greater payment under Section 2.12 or 2.14 than the applicable Lender would have been entitled to
receive with respect to the participation sold to such Participant.
(d)
Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of
such Lender, including without limitation any pledge or assignment to secure obligations to a Federal Reserve Bank or other applicable central bank that governs or
regulates the activities of such Lender, and this Section shall not apply to any such pledge or assignment of a security interest; provided that no such pledge or
assignment of a security interest shall release a Lender from any of its obligations hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.
Any Lender may, at any time, assign all or a portion of its rights and obligations with respect to Loans to an Affiliated Lender, subject to the
(e)
following limitations:
(i)
notwithstanding anything herein or in any of the other Loan Documents to the contrary, with respect to any acquisition of Loans, (1)
under no circumstances, whether or not any Loan Party is subject to a bankruptcy or other insolvency proceeding, shall such Affiliated Lender be permitted
to exercise any voting rights or any right to direct the Administrative Agent or the Collateral Agent to undertake any action (or refrain from taking any
action) with respect to any Loans and any Loans that are assigned to such Affiliated Lender shall have no voting rights or any right to direct the
Administrative Agent or the Collateral Agent to undertake any action (or refrain from taking any action) under this Agreement and the other Loan
Documents (and shall not object to any actions taken by the non-Affiliated Lenders, Administrative Agent or Collateral Agent in a bankruptcy or
insolvency proceeding) and will be deemed to have voted in the same proportion as non-Affiliated Lenders voting on such matter, unless the action or vote
in question adversely affects such Affiliated Lender (solely in its capacity as a Lender) in any material respect as com- pared to the other Lenders, (2) such
Affiliated Lender shall not receive information provided solely to Lenders by the Administrative Agent or any Lender and shall not be permitted to attend
or participate in
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meetings attended solely by Lenders and the Administrative Agent and their advisors and (3) the Affiliated Lender must provide a representation and
warranty that it is not in possession of any material non-public information with respect to the Loan Parties or their subsidiaries, or with respect to the
Loans or the securities of any such person, that (A) has not been previously disclosed in writing to the assigning Lender or the Lenders generally (other
than because such Lender does not wish to receive such material non-public in- formation) prior to such time and (B) could reasonably be expected to have
a material effect upon, or otherwise be material to, the assigning Lender’s decision to make such assignment;
(ii)
(iii)
(iv)
at the time any Affiliated Lender is making purchases of Loans it shall enter into an Affil- iated Lender Assignment and Assumption;
at the time of such assignment, no Default or Event of Default shall have occurred and be continuing or would result therefrom;
each Affiliated Lender agrees to waive any right to bring any action in connection with the Loans against the Administrative Agent
and Collateral Agent, in their capacities as such;
(v)
Affiliated Lenders may not hold more than 25% of the total amount of Loans and Commitments of any Class hereunder.
SECTION 9.06 Survival . All covenants, agreements, representations and warranties made by any Loan Parties herein, in the other Loan Documents and
in the certificates or other instruments delivered in connection with or pursuant to this Agreement or the other Loan Documents shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and delivery of this Agreement and the other Loan Documents and the making of any Loans,
regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Administrative Agent or any Lender may have had notice
or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect as long as
the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid and so long as the
Revolving Commitments have not expired or terminated. The provisions of Sections 2.12, 2.13, 2.14 and 9.04 and Article VIII shall survive and remain in full force
and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the expiration or termination of the Commitments,
any assignment of rights by or replacement of a Lender or the termination of this Agreement or any provision hereof.
SECTION 9.07 Counterparts; Integration; Effectiveness . This Agreement may be executed in counter- parts (and by different parties hereto on different
counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Agreement, the other Loan
Documents and any separate letter agreements with respect to fees payable to the Administrative Agent or the Lead Arranger constitute the entire contract among the
parties relating to the subject matter hereof and supersede any and all previous agree- ments and understandings, oral or written, relating to the subject matter hereof.
This Agreement shall become effec- tive as provided in Section 4.01, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns. Delivery of an executed counterpart of a signature page of this Agree- ment by email or telecopy shall be effective as delivery of a
manually executed counterpart of this Agreement.
SECTION 9.08 Severability . Any provision of this Agreement held to be invalid, illegal or unenforce- able in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining
provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.
SECTION 9.09 Right of Setoff . If an Event of Default shall have occurred and be continuing, each Lender and each of its Affiliates is hereby authorized
at any time and from time to time, to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or
final) at any time held and other obligations at any time owing by such Lender or Affiliate to or for the credit or the account of the Borrower against any of and all
the obligations of the Borrower now or hereafter existing under this Agreement
106
held by such Lender, irrespective of whether or not such Lender shall have made any demand under this Agreement and although such obligations may be
unmatured. The rights of each Lender under this Section are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.
Each Lender agrees to notify the Administrative Agent promptly after any such setoff and application; provided that the failure to give such notice shall not affect
the validity of such setoff and application.
SECTION 9.10 Governing Law; Jurisdiction; Consent to Service of Process .
(a)
This Agreement and the other Loan Documents and any claims, controversy, dispute or cause of action (whether in contract or otherwise)
based upon, arising out of or relating to this Agreement or any other Loan Document (except, as to any other Loan Document, as expressly set forth therein) and the
transactions contemplated hereby and thereby shall be governed by and construed in accordance with the law of the State of New York.
(b)
The Borrower and each other Loan Party irrevocably and unconditionally agrees that it will not commence any action, litigation or proceeding
of any kind or description, whether in law or equity, whether in con- tract or in tort or otherwise, against the Administrative Agent, any Lender, any Issuing Bank, or
any Related Party of the foregoing in any way relating to this Agreement or any other Loan Document or the transactions relating hereto or thereto, in any forum
other than the courts of the State of New York sitting in New York County, and of the Unit- ed States District Court of the Southern District of New York, and any
appellate court from any thereof, and each of the parties hereto irrevocably and unconditionally submits to the jurisdiction of such courts and agrees that all claims in
respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such Federal court. Each of the
parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or
in any other manner provided by law. Nothing in this Agreement or any other Loan Document shall affect any right that the Administrative Agent, any Lender or
any Issuing Bank may otherwise have to bring any action or proceeding relating to this Agreement or the other Loan Documents against the Borrower or any other
Loan Party or their respective properties in the courts of any jurisdiction.
(c)
The Borrower and each other Loan Party hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do
so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or the other
Loan Documents in any court referred to in paragraph (b) of this Section. Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law,
the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.
(d)
Each party to this Agreement irrevocably consents to service of process in the manner provided for notices in Section 9.01. Nothing in this
Agreement will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
SECTION 9.11 WAIVER OF JURY TRIAL . EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT
OF OR RELATING TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY
(WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE,
AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED TO IT, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT AND THE OTHER LOAN DOCUMENT BY, AMONG OTHER THINGS,
THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.12 Headings . Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.
107
SECTION 9.13 Confidentiality . Each of the Administrative Agent and the Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its and its Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and
other advisors (it be- ing understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed
to keep such Information confidential), (b) to the extent requested by any regulatory or self-regulatory authority, (c) to the extent required by applicable laws or
regulations or by any subpoena or similar legal process, (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder or
any other Loan Document or any suit, action or proceeding relating to this Agreement or any other Loan Docu- ment or the enforcement of rights hereunder or
thereunder, (f) subject to an agreement containing provisions sub- stantially the same as those of this Section, to (i) any assignee of or Participant in, or any
prospective assignee of or Participant in, any of its rights or obligations under this Agreement or (ii) any actual or prospective counterparty (or its advisors) to any
swap or derivative transaction relating to the Borrower and its obligations, (g) with the consent of the Borrower, (h) to the extent such Information (i) becomes
publicly available other than as a result of a breach of this Section or an agreement described in clause (f) hereof or (ii) becomes available to the Administrative
Agent or any Lender on a nonconfidential basis from a source other than the Borrower or (i) on a confidential basis to (x) any rating agency in connection with
rating the Borrower or any of its subsidiaries or the Loans hereunder, (y) the CUSIP Service Bureau or any similar agency in connection with the issuance and
monitoring of CUSIP numbers with respect to the facilities or (z) market data collectors, similar service providers to the lending industry and ser- vice providers to
the Administrative Agent in connection with the administration and management of this Agree- ment and the other Loan Documents. For the purposes of this
Section, “ Information ” means all information re- ceived from the Borrower or its Affiliates relating to the Borrower, its subsidiaries or their businesses, other than
any such information that is available to the Administrative Agent or any Lender on a nonconfidential basis prior to disclosure by the Borrower or its Affiliates. 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 if such
Person has exer- cised the same degree of care to maintain the confidentiality of such Information as such Person would reasonably accord to its own confidential
information.
Subject to Section 9.18, each Lender acknowledges that information furnished to it pursuant to this Agree- ment or the other Loan Documents may include
material non-public information concerning the Borrower and its Affiliates and their related parties or their respective securities, and confirms that it has developed
compliance pro- cedures regarding the use of material non-public information and that it will handle such material non-public infor- mation in accordance with those
procedures and applicable law, including Federal and state securities laws.
Subject to Section 9.18, all information, including requests for waivers and amendments, furnished by the Borrower or the Administrative Agent pursuant
to, or in the course of administering, this Agreement or the other Loan Documents will be syndicate-level information, which may contain material non-public
information about the Borrower and its Affiliates and their related parties or their respective securities. Accordingly, each Lender repre- sents to the Borrower and
the Administrative Agent that it has identified in its administrative questionnaire a credit contact who may receive information that may contain material non-public
information in accordance with its com- pliance procedures and applicable law, including Federal and state securities laws.
SECTION 9.14 Judgment Currency . If, for the purposes of obtaining judgment or filing a claim in any court, it is necessary to convert a sum due
hereunder or claim in one currency into another currency, the rate of ex- change used shall be that at which in accordance with normal banking procedures the
Administrative Agent could purchase the first currency with such other currency on the Business Day preceding that on which final judgment is given. The
obligation of the Borrower in respect of any such sum due from it to the Administrative Agent or the Lenders hereunder shall, notwithstanding any judgment in a
currency (the “ Judgment Currency ”) other than that in which such sum is denominated in accordance with the applicable provisions of this Agreement (the “
Agreement Currency ”), be discharged only to the extent that on the Business Day following receipt by the Administrative Agent of any sum adjudged to be so due
in the Judgment Currency, the Administrative Agent may in accordance with normal banking procedures 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 Administrative Agent from the Borrower in the
Agreement Currency, the Borrower agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Administrative Agent or the Person to
whom such obligation was owing against such loss. If the amount of the Agreement Currency so purchased is greater than the sum originally due to the
Administrative
108
Agent in such currency, the Administrative Agent agrees to return the amount of any excess to the Borrower (or to any other Person who may be entitled thereto
under applicable law).
SECTION 9.15 USA PATRIOT Act . Each Lender subject to the Act hereby notifies the Borrower that pursuant to the requirements of the USA
PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)) (the “ Act ”), it is hereby required to obtain, verify and record information that
identifies the Borrower, which information includes the name and address of the Borrower and other information that will allow such Lender to identify the
Borrower in accordance with the Act.
SECTION 9.16 Collateral and Guarantee Matters .
(a)
The Lenders irrevocably authorize the Administrative Agent to enter into any customary intercreditor agreement or arrangement in form and
substance reasonably satisfactory to the Administrative Agent with the holders of any Permitted Secured Ratio Debt (or any agent thereof) permitted under this
Agreement that in the good faith determination of the Administrative Agent is necessary to effectuate the incurrence of such Indebtedness.
(b)
Any Lien on any property granted to or held by the Administrative Agent under any Loan Docu- ment shall automatically be released (i) upon
all of the Obligations (other than (x) (A) Cash Management Obliga- tions and (B) Obligations under Specified Swap Agreements not yet due and payable, and (y)
contingent obligations not yet accrued and payable) having been paid in full, all Letters of Credit having been cash collateralized or other- wise back-stopped
(including by “grandfathering” into any future credit facilities), in each case, on terms reasonably satisfactory to the relevant Issuing Bank in its sole discretion, or
having expired or having been terminated, and the Total Revolving Commitments having expired or having been terminated, (ii) that is Disposed of or to be
Disposed of as part of or in connection with any Disposition not prohibited hereunder or under any other Loan Document to any Person other than a Loan Party, (iii)
subject to Section 9.02, if approved, authorized or ratified in writing by the Required Lenders, (iv) owned by a Subsidiary Guarantor upon (or substantially
simultaneously with) release of such Subsidiary Guarantor from its obligations under its Guarantee Agreement pursuant to clause (c) below, or (v) as expressly
provided in the Collateral Documents.
(c)
Any Subsidiary Guarantor shall automatically be released from its obligations under the Guarantee Agreement (A) in the event of dissolution
of such Person, (B) if such Person is designated as an Unrestricted Subsidiary or otherwise ceases to be a Restricted Subsidiary, in each case in accordance with the
provisions of this Agreement, upon (or substantially simultaneously with) effectiveness of such designation or when it first ceases to be a Restricted Subsidiary,
respectively, (C) if the obligations under this Agreement are discharged in accordance with the terms of this Agreement or (D) as otherwise expressly provided in the
Guarantee Agreement; provided that no such release shall occur with respect to an entity that ceases to be a Restricted Subsidiary if such Subsidiary Guarantor
continues to be a guarantor in respect of any Permitted Ratio Debt unless and until such guarantor is (or is being substantially simultaneously) released from its
guarantee with respect to such Permitted Ratio Debt.
(d)
Each IAC Guarantor has been automatically be released from its obligations under the Guarantee Agreement and was automatically released
upon receipt of an Officer’s Certificate of the Borrower on the Separation Date stating that the Borrower will be designated as unrestricted subsidiary under the IAC
Credit Agreement and IAC Senior Notes, as applicable, on such date.
(e)
Upon request by the Administrative Agent at any time, the Required Lenders will confirm in writ- ing the Administrative Agent’s authority to
release its interest in particular types or items of property, release any Subsidiary Guarantor from its obligations under the Guarantee Agreement, or enter into an
intercreditor agreement pursuant to this Section 9.16. In each case as specified in this Section 9.16, the Administrative Agent will, at the Loan Parties’ expense,
execute and deliver to the applicable Loan Party such documents as such Loan Party may reasonably request to evidence the release of such item of Collateral from
the assignment and security interest grant- ed under the Collateral Documents, or to release such Subsidiary Guarantor from its obligations under the Guarantee
Agreement, in each case in accordance with the terms of the Loan Documents and this Section 9.16.
SECTION 9.17 No Advisory or Fiduciary Relationsh ip. In connection with all aspects of each transac- tion contemplated hereby, the Borrower
acknowledges and agrees for itself and on behalf of the Loan Parties that (i)
109
the Revolving Facility provided for hereunder and any related arranging or other services in connection therewith (including in connection with any amendment,
waiver or other modification hereof or of any other Loan Document) are an arm’s-length commercial transaction between the Loan Parties, on the one hand, and the
Agent Parties and the Lenders, on the other hand, and the Loan Parties are capable of evaluating and understanding and understand and accept the terms, risks and
conditions of the transactions contemplated hereby and by the other Loan Documents (including any amendment, waiver or other modification hereof or thereof);
(ii) in connection with the process lead- ing to such transaction, each of the Agent Parties and the Lenders is and has been acting solely as a principal and is not the
agent or fiduciary for the Loan Parties; (iii) the Lead Arrangers, Agent Parties and their respective Affiliates may be engaged in a broad range of transactions that
involve interests that differ from, and may conflict with, those of the Borrower and its Affiliates, and none of the Lead Arrangers or the Agent Parties has any
obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary relationship; and (iv) the Agent Parties and the Lenders have not provided
and will not provide any legal, accounting, regulatory or tax advice with respect to any of the transactions contemplated hereby (including any amendment, waiver
or other modification hereof or of any other Loan Document) and the Loan Parties have consulted their own legal, accounting, regulatory and tax advisors to the
extent they have deemed appropriate.
SECTION 9.18 Platform; Borrower Materials . The Borrower hereby acknowledges that (a) the Administrative Agent and/or the Lead Arrangers
will make available to the Lenders and the Issuing Bank materials and/or information provided by or on behalf of the Borrower hereunder (collectively, “ B orrower
Materials ”) by posting the Borrower Materials on Intralinks or another similar electronic system (the “ Pl atform ”), and (b) certain of the Lenders may be “public-
side” Lenders (i.e., Lenders that do not wish to receive material non-public information with respect to the Borrower or their respective Subsidiaries or any of their
respective securities) (each, a “ Pu blic Lende r”). The Borrower hereby agrees that it will identify that portion of the Borrower Materials that may be dis- tributed to
the Public Lenders and that (i) all such Borrower Materials shall be clearly and conspicuously marked “PUBLIC” which, at a minimum, shall mean that the word
“PUBLIC” shall appear prominently on the first page thereof, (ii) by marking Borrower Materials “PUBLIC,” the Borrower shall be deemed to have authorized the
Ad- ministrative Agent, the Lead Arrangers, the Issuing Bank and the Lenders to treat such Borrower Materials as solely containing information that is either (A)
publicly available information or (B) not material (although it may be sensi- tive and proprietary) with respect to the Borrower or the Subsidiaries or any of their
respective securities for purpos- es of United States Federal securities laws ( p rovided , however , that such Borrower Materials shall be treated as set forth in
Section 9.13, to the extent such Borrower Materials constitute information subject to the terms thereof), (iii) all Borrower Materials marked “PUBLIC” are permitted
to be made available through a portion of the Platform designated “Public Investor;” and (iv) the Administrative Agent and 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 Investor.” THE
PLATFORM IS PROVIDED “AS IS” AND “AS AVAILABLE”. THE ADMINISTRATIVE AGENT, ITS RELATED PARTIES AND THE LEAD ARRANGERS
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. 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 THE ADMINISTRATIVE
AGENT, ANY OR ITS RELATED PARTIES OR ANY LEAD ARRANGER IN CONNECTION WITH THE BORROWER MATERIALS OR THE PLATFORM.
110
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as
of the day and year first above written.
MATCH GROUP, INC.
By:/s/ NICK STOUMPAS
Name: Nick Stoumpas
Title: Vice President and Treasurer
HIGHER EDGE MARKETING SERVICES, INC.
HUMOR RAINBOW, INC.
MATCH.COM INTERNATIONAL HOLDINGS, INC.
MATCH.COM, L.L.C.
MOJO ACQUISITION CORP.
PEOPLE MEDIA, INC.
PEOPLE MEDIA, LLC
TINDER, INC.
TPR EDUCATION HOLDINGS, INC.
TPR EDUCATION IP HOLDINGS, LLC
TPR EDUCATION OFFSHORE HOLDINGS, LLC
TPR EDUCATION WORLDWIDE, LLC
TPR EDUCATION, LLC
TUTOR.COM, INC.
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent
By:/s/ DONATUS O. ANUSIONWU
Name: Donatus O. Anusionwu
Title: Vice President
BANK OF AMERICA, N.A.,
as Lender
By:/s/ MARIE F. HARRISON
Name: Marie F. Harrison
Title: Vice President
BARCLAYS BANK PLC,
as Lender
By:/s/ AMIR BARASH
Name: Amir Barash
Title: Director
BMO HARRIS BANK, N.A.,
as Lender
By:/s/ JOAN MURPHY
Name: Joan Murphy
Title: Director
BNP PARIBAS,
as Lender
By:/s/ NICOLE RODRIGUEZ
Name: Nicole Rodriguez
Title: Director
By:/s/ ADE ADEDEJI
Name: Ade Adedeji
Title: Vice President
DEUTSCH BANK AG NEW YORK BRANCH,
as Lender
By:/s/ ANCA TRIFAN
Name: Anca Trifan
Title: Managing Director
By:/s/ MICHAEL WINTERS
Name: Michael Winters
Title: Vice President
FIFTH THIRD BANK,
as Lender
By:/s/ CHRISTOPHER F. STAPLES
Name: Christopher F. Staples
Title: Vice President
GOLDMAN SACHS BANK USA,
as Lender
By:/s/ JERRY LI
Name: Jerry Li
Title: Authorized Signatory
PNC BANK, NATIONAL ASSOCIATION,
as Lender
By:/s/ THOMAS BROWER
Name: Thomas Brower
Title: Senior Vice President
SOCIETE GENERALE,
as Lender
By:/s/ NIGEL ELVEY
Name: Nigel Elvey
Title: Director
Match Group, Inc. Subsidiaries
As of December 31, 2015
Exhibit 21.1
Entity
1040779 B.C. Ltd.
Connect, LLC
DatingDirect.com Limited
Delightful.com, LLC
Eureka SG Pte. Ltd.
Eureka Taiwan
Eureka, Inc.
Jurisdiction of Formation
British Columbia
Delaware
United Kingdom
Delaware
Singapore
Taiwan
Japan
Five Star Matchmaking Information Technology (Beijing) Co., Ltd.
People’s Republic of China
FriendScout24 GmbH
GetAFive, Inc.
Hatch Labs, Inc.
Higher Edge Marketing Services, Inc.
HowAboutWe, LLC
Humor Rainbow, Inc.
M8 Singlesnet LLC
Mash Dating, LLC
Massive Media Europe NV
Massive Media Limited
Massive Media Match NV
Match Financing, LLC
Match Group, Inc.
Match Internet Financial Services Designated Activity Company
Match ProfilePro, LLC
Match.com Canada Ltd.
Match.com Europe Limited
Match.com Events LLC
Match.com Foreign Holdings II Limited
Match.com Foreign Holdings III Limited
Match.com Foreign Holdings Limited
Match.com Global Investments SARL
Match.com Global Services Limited
Match.com HK Limited
Match.com International Holdings, Inc.
Match.com International II Limited
Match.com International Limited
Match.com Investments, Inc.
Match.com Japan KK
Match.com Japan Networks GK
Match.com LatAm Limited
Match.com Luxembourg SARL
Match.com Nordic AB
Match.com Offshore Holdings, Ltd
Germany
Delaware
Delaware
California
Delaware
New York
Delaware
Delaware
Belgium
United Kingdom
Belgium
Delaware
Delaware
Ireland
Delaware
British Columbia
United Kingdom
Delaware
England and Wales
England and Wales
France
Luxembourg
United Kingdom
Hong Kong
Delaware
England and Wales
United Kingdom
Cayman Island
Japan
Japan
United Kingdom
Luxembourg
Sweden
Mauritius
Entity
Match.com Pegasus Limited
Match.com, L.L.C.
Matchcom Mexico, S. de R.L., de C.V.
Meetic Espana, SLU
Meetic Italia SRL
Meetic Netherlands BV
Meetic SAS
MM LatAm, LLC
Mojo Acquisition Corp.
Mojo Finance Co.
Neu.de GmbH
Nexus Limited
Parperfeito Comunicacao SA
People Media, Inc.
People Media, LLC
Plentyoffish Media Inc.
Search Floor, Inc.
Shoptouch, Inc.
Soulmates Technology Pty Ltd.
SpeedDate.com, LLC
Tinder France
Tinder, Inc.
TPR Education Canada, ULC
TPR Education Holdings, Inc.
TPR Education IP Holdings, LLC
TPR Education Offshore Holdings, LLC
TPR Education Worldwide, LLC
TPR Education, LLC
Tutor.com, Inc.
Jurisdiction of Formation
United Kingdom
Delaware
Mexico
Spain
Italy
Netherlands
France
Delaware
Delaware
Cayman Islands
Germany
United Kingdom
Brazil
Delaware
Arizona
British Columbia
California
Delaware
New South Wales Australia
Delaware
France
Delaware
Nova Scotia
Delaware
Delaware
Delaware
Delaware
Delaware
Delaware
Consent of Independent Registered Public Accounting Firm
We consent to the incorporation by reference in the Registration Statement (Form S-8 No. 333-208202) of Match Group, Inc. of our report dated March 28,
2016 , with respect to the consolidated and combined financial statements and schedule of Match Group, Inc. included in this Annual Report (Form 10-K) for the year
ended December 31, 2015.
Exhibit 23.1
March 28, 2016
New York, New York
/s/ ERNST & YOUNG LLP
Certification
Exhibit 31.1
1.
2.
3.
4.
I, Gregory R. Blatt, certify that:
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2015 of Match Group, Inc.;
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(s) 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)) for the registrant and have:
a)
b)
c)
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;
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(s) 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.
Dated:
March 28, 2016
/s/ GREGORY R. BLATT
Gregory R. Blatt
Chairman and Chief Executive Officer
Certification
Exhibit 31.2
1.
2.
3.
4.
I, Gary Swidler, certify that:
I have reviewed this report on Form 10-K for the fiscal year ended December 31, 2015 of Match Group, Inc.;
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(s) 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)) for the registrant and have:
a)
b)
c)
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;
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(s) 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.
Dated:
March 28, 2016
/s/ GARY SWIDLER
Gary Swidler
Chief Financial Officer
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 32.1
I, Gregory R. Blatt, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that, to my knowledge:
(1)
(2)
the Annual Report on Form 10-K for the fiscal year ended December 31, 2015 of Match Group, Inc. (the "Report") which this statement accompanies fully
complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Match Group, Inc.
Dated:
March 28, 2016
/s/ GREGORY R. BLATT
Gregory R. Blatt
Chairman and Chief Executive Officer
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
Exhibit 32.2
I, Gary Swidler, certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, 18 U.S.C. Section 1350, that, to my knowledge:
(1)
(2)
the Annual Report on Form 10-K for the fiscal year ended December 31, 2015 of Match Group, Inc. (the "Report") which this statement accompanies fully
complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)); and
the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of Match Group, Inc.
Dated:
March 28, 2016
/s/ GARY SWIDLER
Gary Swidler
Chief Financial Officer