UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of report (Date of earliest event reported): February 17, 2011
Burlington Coat Factory Investments Holdings, Inc.
(Exact Name of Registrant As Specified In Charter)
| Delaware | 333-137917 | 20-4663833 | ||
|
(State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(IRS Employer Identification No.) |
1830 Route 130 North
Burlington, New Jersey 08016
(Address of Principal Executive Offices, including Zip Code)
(609) 387-7800
(Registrant’s telephone number, including area code)
Not applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 1.01 | Entry into a Material Definitive Agreement. |
Senior Notes Offering
On February 17, 2011, Burlington Coat Factory Warehouse Corporation (the “Company”) entered into a purchase agreement (the “Purchase Agreement”) with Goldman, Sachs & Co., J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporation and Wells Fargo Securities, LLC (collectively, the “Initial Purchasers”) relating to the issuance and sale of $450 million aggregate principal amount of 10.000% Senior Notes due 2019 at an issue price of 100.00% (the “Notes”).
On February 24, 2011, the Company completed its previously announced offering of the Notes by issuing the Notes in a private offering that is exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), to qualified institutional buyers in accordance with Rule 144A and to persons outside of the United States pursuant to Regulation S under the Securities Act.
The Notes were issued pursuant to an indenture, dated February 24, 2010 (the “Indenture”), among the Company, the guarantors signatory thereto and Wilmington Trust FSB, governing the Notes. The Notes are senior unsecured obligations of the Company and are guaranteed on a senior basis by the Company, the Company’s direct parent, Burlington Coat Factory Investments Holdings, Inc. (“Holdings”), and each of the Company’s U.S. subsidiaries to the extent such guarantor is a guarantor of the Company’s obligations under the New Term Loan Facility (as defined below).
In connection with the issuance of the Notes, on February 24, 2011, the Company also entered into a registration rights agreement relating to the Notes, pursuant to which the Company has agreed to use its reasonable best efforts to file with the Securities and Exchange Commission and cause to become effective a registration statement with respect to a registered offer to exchange the Notes for new notes, with terms substantially identical in all material respects to the Notes.
Interest is payable on the Notes on each February 15 and August 15, commencing August 15, 2011. The Company may redeem some or all of the Notes at any time prior to February 15, 2015 at a price equal to 100% of the principal amount of the Notes redeemed plus accrued and unpaid interest, if any, and an applicable make-whole premium. On or after February 15, 2015, the Company may redeem some or all of the Notes at redemption prices set forth in the indenture. In addition, at any time prior to February 15, 2014, the Company may redeem up to 35% of the aggregate principal amount of the Notes, at a specified redemption price with the net cash proceeds of certain equity offerings.
The Purchase Agreement contains customary representations, warranties and agreements by the Company. In addition, the Company has agreed to indemnify the Initial Purchasers against certain liabilities, including liabilities under the Securities Act, or to contribute to payments the Initial Purchasers may be required to make in respect of those liabilities. Furthermore, the Company has agreed with the Initial Purchasers not to offer or sell any debt securities issued or guaranteed by the Company for a period of 90 days after the date of the Purchase Agreement without the prior written consent of Goldman, Sachs & Co.
The Indenture contains covenants that, among other things, restrict the ability of the Company and the ability of Holdings and certain of its subsidiaries to: incur, assume or guarantee additional indebtedness; pay dividends or redeem or repurchase capital stock; make other restricted payments; incur liens; redeem debt that is junior in right of payment to the Notes; sell or otherwise dispose of assets, including capital stock of subsidiaries; enter into mergers or consolidations; and enter into transactions with affiliates. These covenants are subject to a number of important exceptions and qualifications. In addition, in certain circumstances, if the Company sells assets or experiences certain changes of control, it must offer to purchase the Notes.
The Company used the net proceeds from the offering of the Notes, together with borrowings under the New Term Loan Facility and the ABL Line of Credit (as defined below), to (i) repurchase any and all of the Company’s outstanding 11 1 / 8 % Senior Notes due 2014 (the “BCF Notes”) and Holdings’ outstanding 14 1 / 2 % Senior Discount Notes due 2014 (the “Holdings Notes” and, together with the BCF Notes, the “Existing Notes”), pursuant to cash tender offers commenced by the Company and Holdings on February 9, 2011, and to redeem any Existing Notes that remain outstanding after the completion of the cash tender offers, and pay related fees and expenses, including tender or redemption premiums and accrued interest on the Existing Notes, (ii) to repay existing indebtedness and (iii) to pay a special cash dividend of approximately $300.0 million in the aggregate to the equity holders of Burlington Coat Factory Holdings, Inc. (“BCFH”) on a pro rata basis, and to pay related fees and expenses. Any remaining net proceeds will be used for general corporate purposes.
Tender Offer and Redemption
In connection with the offering of the Notes, the application of proceeds therefrom and the previously announced early settlement of the cash tender offers of the Company and Holdings for any and all of the BCF Notes and the Holdings Notes, respectively, on February 24, 2011, the Company entered into a Second Supplemental Indenture, dated February 24, 2011 (the “Second Supplemental Indenture”), between the Company, the guarantors signatory thereto and Wilmington Trust FSB, relating to an Indenture (as amended, supplemented or otherwise modified, the “BCF Indenture”), dated April 13, 2006, between the Company, the guarantors signatory thereto and the Wilmington Trust FSB (as successor trustee to Wells Fargo Bank, N.A.), and Holdings entered into a First Supplemental Indenture, dated February 24, 2011 (the “First Supplemental Indenture”), between the Company and Wilmington Trust FSB, relating to an Indenture, dated April 13, 2006 (as amended, supplemented or otherwise
modified, the “Holdings Indenture”), between the Company and the Wilmington Trust FSB (as successor trustee to Wells Fargo Bank, N.A.), to eliminate substantially all of the restrictive covenants, certain affirmative covenants, certain events of default and substantially all of the restrictions on the ability of BCF or Holdings, as applicable, to merge, consolidate or sell all or substantially all of their properties or assets contained in each indenture and the related Existing Notes.
In addition, in connection with the early tender and settlement of 100% of the Holdings Notes by the noteholders of the Holdings Notes on February 24, 2011, Holdings satisfied and discharged its obligations under the Holdings Indenture and with respect to the Holdings Notes.
Further, on February 24, 2011, the Company delivered a notice of redemption for the remaining principal amount not purchased in the early tender and settlement of the BCF Notes, and irrevocably deposited with Wilmington Trust FSB an amount of funds sufficient to pay the redemption price of the BCF Notes to satisfy and discharge its obligations under the BCF Indenture and with respect to the BCF Notes. On April 15, 2011, the Company will redeem the remaining principal amount outstanding of the BCF Notes at a redemption price equal to 102.781% of the aggregate principal amount of the BCF Notes to be redeemed, plus accrued and unpaid interest on the BCF Notes to the redemption date.
New Term Loan
In connection with the offering of the Notes, on February 24, 2011, the Company refinanced its $900.0 million existing senior secured term loan credit facility (the “Existing Term Loan Facility”), issued in the original principal amount of $900.0 million, with the proceeds of a new $1.0 billion senior secured term loan facility (the “New Term Loan Facility”).
On February 24, 2011, the Company and Holdings and the U.S. and Puerto Rican subsidiaries of the Company from time to time party thereto, as facility guarantors (collectively, the “Term Loan Guarantors”) entered into a new credit agreement (the “New Term Loan Credit Agreement”) with JPMorgan Chase Bank, N.A., as administrative agent (in such capacity, the “Term Loan Administrative Agent”) and as collateral agent, the lenders party thereto, J.P. Morgan Securities LLC and Goldman Sachs Lending Partners LLC, as joint bookrunners and J.P. Morgan Securities LLC, Goldman Sachs Lending Partners LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC, as joint arrangers, governing the terms of the New Term Loan Facility.
Like the Existing Term Loan Facility, the New Term Loan Facility is secured by (a) a perfected first priority lien on substantially all real and personal property of the Company and the Term Loan Guarantors and (b) a perfected second priority lien on all inventory, accounts and personal property related to inventory and accounts of the Company and the Term Loan Guarantors, in each case subject to various limitations and exceptions. The New Term Loan Facility requires the Company to maintain a minimum consolidated interest coverage ratio and a maximum consolidated leverage ratio (each measured quarterly) and contains limitations on the Company’s ability to, among other things, incur indebtedness and liens, make investments, capital expenditures and restricted payments, sell assets and prepay certain indebtedness. The New Term Loan Facility also requires the Company to prepay the loans thereunder with a portion of its excess cash flow (commencing with the fiscal year ending January 28, 2012), the proceeds of certain indebtedness and, subject to certain re-investment rights, the proceeds of certain asset sales of certain casualty or other insured events. The New Term Loan Facility contains customary events of default including for failure to make payments under the New Term Loan Facility, materially incorrect representations, breaches of covenants (subject to a 30 day grace period after notice in the case of certain covenants), cross-default to other material indebtedness, material unstayed judgments, certain ERISA, bankruptcy and insolvency events, failure of guarantees or security to remain in full force and effect, change of control, certain uninsured losses to any material portion of the collateral, any undismissed felony indictment of any Term Loan Guarantors or the Company or the imposition of orders or stays having a material adverse effect.
The interest rates for the New Term Loan Facility are based on: (i) for LIBO rate loans for any interest period, at a rate per annum equal to (a) the greater of (x) the LIBO rate as determined by the Term Loan Administrative Agent, for such interest period multiplied by the Statutory Reserve Rate (as defined in the New Term Loan Credit Agreement) and (y) 1.50% (the “Term Loan Adjusted LIBO Rate”), plus an applicable margin; and (ii) for prime rate loans, a rate per annum equal to the highest of (a) the variable annual rate of interest then announced by JPMorgan Chase Bank, N.A. at its head office as its “prime rate,” (b) the federal funds rate in effect on such date plus 0.50% per annum, and (c) the Term Loan Adjusted LIBO Rate for the applicable class of term loans for one-month plus 1.00%, plus, in each case, an applicable margin.
In addition, the New Term Loan Facility provides for an uncommitted incremental term loan facility of up to $150.0 million that is available subject to the satisfaction of certain conditions.
The New Term Loan Facility has a six year maturity, except that term loans made in connection with the incremental term loan facility or extended in connection with the extension mechanics of the New Term Loan Facility have the maturity dates set forth in the amendments applicable to such term loans.
New ABL Facility
In connection with the offering of the Notes and the refinancing of the Existing Term Loan Facility, on February 24,
2011, the Company entered into a First Amendment (the “First Amendment”) to the Amended and Restated Credit Agreement, dated January 15, 2010 (as amended, supplemented and otherwise modified, the “Amended ABL Credit Agreement”), among the Company, as lead borrower, the borrowers party thereto, the facility guarantors party thereto, Bank of America, N.A. as administrative agent and collateral agent, the lenders party thereto, Wells Fargo Retail Finance, LLC and Regions Bank as co-syndication agents, J.P. Morgan Securities Inc. and UBS Securities LLC as co-documentation agents and General Electric Capital Corporation, US Bank, National Association and SunTrust Bank as senior managing agents, governing the Company’s existing senior secured asset-based revolving credit facility (the “ABL Line of Credit”) to permit the Company to, among other things, (i) issue and guarantee the Notes, (ii) incur additional indebtedness in connection with the refinancing of the Existing Term Loan Facility by increasing the limitation on term loan indebtedness from $900.0 million to $1.0 billion, (iii) have additional flexibility to make investments, capital expenditures, and dividends and other distributions with respect to equity interests and (iv) make a cash dividend of approximately $300.0 million in the aggregate to the equity holders of BCFH on a pro rata basis.
The foregoing descriptions of the Second Supplemental Indenture, the First Supplemental Indenture, the Purchase Agreement, the Indenture, the form of the Notes, the Registration Rights Agreement, New Term Loan Credit Agreement and the First Amendment are qualified in their entirety by reference to such documents, copies of which are attached hereto as Exhibits 4.1, 4.2, 1.1, 4.3, 4.4, 10.1, 10.2 and 10.3, respectively, and are incorporated into this item 1.01 by reference.
Disclosure Regarding Forward-Looking Statements:
Some of the statements in this report may constitute “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. These statements are not historical facts but rather are based on the Company’s current expectations, estimates and projections regarding the Company’s business, operations and other factors relating thereto. Words such as “may,” “will,” “could,” “would,” “should,” “anticipate,” “predict,” “potential,” “continue,” “expects,” “intends,” “plans,” “projects,” “believes,” “estimates” and similar expressions are used to identify these forward-looking statements. These statements are only predictions and as such are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. For a discussion of these risks, uncertainties and assumptions, any of which could cause our actual results to differ from those contained in the forward-looking statement, see the section of the Company’s Transition Report on Form 10-K/T for the period from May 31, 2009 through January 30, 2010, entitled “Risk Factors” and discussions of potential risks and uncertainties in the Company’s subsequent filings with the Securities and Exchange Commission.
| Item 1.02 | Termination of a Material Definitive Agreement. |
The information contained in Item 1.01 is incorporated herein by reference.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information contained in Item 1.01 is incorporated herein by reference.
| Item 9.01. | Financial Statements and Exhibits . |
| (d) | Exhibits |
| Exhibit No. | Description | |
| 1.1 | Purchase Agreement, dated February 17, 2011, among Burlington Coat Factory Warehouse Corporation, the guarantors signatory thereto, Goldman, Sachs & Co., J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporation and Wells Fargo Securities, LLC. | |
| 4.1 | Second Supplemental Indenture, dated February 24, 2011, among Burlington Coat Factory Warehouse Corporation, the guarantors signatory thereto and Wilmington Trust FSB. | |
| 4.2 | First Supplemental Indenture, dated February 24, 2011, between Burlington Coat Factory Investments Holdings, Inc. and Wilmington Trust FSB. | |
| 4.3 | Indenture, dated February 24, 2011, among Burlington Coat Factory Warehouse Corporation, the guarantors signatory thereto and Wilmington Trust FSB. | |
| 4.4 | Form of 10.000% Senior Notes due 2019 (included in Exhibit 4.3 hereto). | |
| 10.1 | Registration Rights Agreement, dated February 24, 2011, among Burlington Coat Factory Warehouse Corporation, the guarantors signatory thereto, Goldman, Sachs & Co., J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporation and Wells Fargo Securities, LLC. | |
| 10.2 | Credit Agreement, dated February 24, 2011, among Burlington Coat Factory Warehouse Corporation, Burlington Coat Factory Investments Holdings, Inc., the facility guarantors signatory thereto, JPMorgan Chase Bank, N.A., as administrative agent and as collateral agent, the lenders party thereto, J.P. Morgan | |
| Securities LLC and Goldman Sachs Lending Partners LLC, as joint bookrunners and J.P. Morgan Securities LLC, Goldman Sachs Lending Partners LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC, as joint arrangers. | ||
| 10.3 | First Amendment, dated February 24, 2011, to the Amended and Restated Credit Agreement, dated as of January 15, 2010, among Burlington Coat Factory Warehouse Corporation, as Lead Borrower, the Borrowers and the Facility Guarantors party thereto, Bank of America, N.A., as Administrative Agent and as Collateral Agent, the Lenders party thereto, Wells Fargo Retail Finance, LLC and Regions Bank, as Co-Syndication Agent, J.P. Morgan Securities Inc. and UBS Securities LLC, as Co-Documentation Agents and General Electric Capital Corporation, US Bank, National Association and Suntrust Bank as Senior Managing Agents. | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| BURLINGTON COAT FACTORY INVESTMENTS HOLDINGS, INC. | ||
|
/s/ Robert L. LaPenta, Jr. |
||
| Robert L. LaPenta, Jr. | ||
| Vice President and Treasurer | ||
Date: February 24, 2011
EXHIBIT INDEX
| Exhibit No. | Description | |
| 1.1 | Purchase Agreement, dated February 17, 2011, among Burlington Coat Factory Warehouse Corporation, the guarantors signatory thereto, Goldman, Sachs & Co., J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporation and Wells Fargo Securities, LLC. | |
| 4.1 | Second Supplemental Indenture, dated February 24, 2011, among Burlington Coat Factory Warehouse Corporation, the guarantors signatory thereto and Wilmington Trust FSB. | |
| 4.2 | First Supplemental Indenture, dated February 24, 2011, between Burlington Coat Factory Investments Holdings, Inc. and Wilmington Trust FSB. | |
| 4.3 | Indenture, dated February 24, 2011, among Burlington Coat Factory Warehouse Corporation, the guarantors signatory thereto and Wilmington Trust FSB. | |
| 4.4 | Form of 10.000% Senior Notes due 2019 (included in Exhibit 4.3 hereto). | |
| 10.1 | Registration Rights Agreement, dated February 24, 2011, among Burlington Coat Factory Warehouse Corporation, the guarantors signatory thereto, Goldman, Sachs & Co., J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporation and Wells Fargo Securities, LLC. | |
| 10.2 | Credit Agreement, dated February 24, 2011, among Burlington Coat Factory Warehouse Corporation, Burlington Coat Factory Investments Holdings, Inc., the facility guarantors signatory thereto, JPMorgan Chase Bank, N.A., as administrative agent and as collateral agent, the lenders party thereto, J.P. Morgan Securities LLC and Goldman Sachs Lending Partners LLC, as joint bookrunners and J.P. Morgan Securities LLC, Goldman Sachs Lending Partners LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC, as joint arrangers. | |
| 10.3 | First Amendment, dated February 24, 2011, to the Amended and Restated Credit Agreement, dated as of January 15, 2010, among Burlington Coat Factory Warehouse Corporation, as Lead Borrower, the Borrowers and the Facility Guarantors party thereto, Bank of America, N.A., as Administrative Agent and as Collateral Agent, the Lenders party thereto, Wells Fargo Retail Finance, LLC and Regions Bank, as Co-Syndication Agent, J.P. Morgan Securities Inc. and UBS Securities LLC, as Co-Documentation Agents and General Electric Capital Corporation, US Bank, National Association and Suntrust Bank as Senior Managing Agents. | |
Exhibit 1.1
Burlington Coat Factory Warehouse Corporation
$450,000,000 10.000% Senior Notes due 2019
PURCHASE AGREEMENT
dated February 17, 2011
Goldman, Sachs & Co.
J.P. Morgan Securities LLC
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Wells Fargo Securities, LLC
PURCHASE AGREEMENT
February 17, 2011
GOLDMAN, SACHS & CO.
J.P. MORGAN SECURITIES LLC
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
WELLS FARGO SECURITIES, LLC
As Initial Purchasers
c/o Goldman, Sachs & Co.
200 West Street New York,
New York 10282-2198
Ladies and Gentlemen:
Introductory . Burlington Coat Factory Warehouse Corporation, a Delaware corporation (the “Company”), proposes to issue and sell to the several Initial Purchasers named in Schedule A (the “Initial Purchasers”), acting severally and not jointly, the respective amounts set forth in such Schedule A of $450,000,000 aggregate principal amount of its 10.000% Senior Notes due 2019 (the “Notes”). Goldman, Sachs & Co., J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC have agreed to act as the several Initial Purchasers in connection with the offering and sale of the Notes.
The Notes will be issued pursuant to an indenture, to be dated as of February 24, 2011 (the “Indenture”), between the Company, the Guarantors (as defined below) and Wilmington Trust FSB, as trustee (the “Trustee”). Notes will be issued only in book-entry form in the name of Cede & Co., as nominee of The Depository Trust Company (the “Depositary”) pursuant to a letter of representations, to be dated on or before the Closing Date (as defined in Section 2 hereof) (the “DTC Agreement”), among the Company and the Depositary.
The holders of the Notes will be entitled to the benefits of a registration rights agreement relating to the Notes, to be dated as of February 24, 2011 (the “Registration Rights Agreement”), among the Company, the Guarantors and the Initial Purchasers. Pursuant to the Registration Rights Agreement, the Company and the Guarantors will agree to file with the Commission (as defined below), under the circumstances set forth therein, (i) a registration statement under the Securities Act (as defined below) relating to another series of debt securities of the Company with terms substantially identical to each series of Notes (the “Exchange Notes”) to be offered in exchange for such Notes (the “Exchange Offer”) and (ii) to the extent required by the Registration Rights Agreement, a shelf registration statement pursuant to Rule 415 of the Securities Act relating to the resale by certain holders of the Notes, and in each case, to use its commercially reasonable efforts to cause such registration statements to be declared effective.
The payment of principal of, premium, if any, and interest on the Notes and the Exchange Notes (as defined below) will be fully and unconditionally guaranteed, on a senior unsecured basis, jointly and severally by (i) the Guarantors listed on Schedule B and (ii) any subsidiary of the Company formed or acquired after the Closing Date that executes an additional guarantee in accordance
with the terms of the Indenture, and their respective successors and assigns (collectively, the “Guarantors”), pursuant to their guarantees (the “Guarantees”). The Notes and the Guarantees attached thereto are herein collectively referred to as the “Securities”; and the Exchange Notes and the Guarantees attached thereto are herein collectively referred to as the “Exchange Securities.”
The Company will simultaneously enter into a senior secured term loan facility in an amount of $1,000.0 million (the “Term Loan Facility”), among Burlington Coat Factory Holdings, Inc., Burlington Coat Factory Investments Holdings, Inc. (“Holdings”), the Company, the Guarantors other than Holdings, the lenders party thereto and certain affiliates of the Initial Purchasers and enter into an amendment (the “ABL Amendment”) of its existing asset-based revolving credit facility (the “ABL Facility” and together with the Term Loan Facility, the “Senior Secured Credit Facilities”) among Holdings, the Company, the Guarantors, the lenders party thereto and certain affiliates of the Initial Purchasers.
For the purposes of this Agreement, the term “Transactions” means the issuance of the Notes by the Company, the entry into the ABL Amendment and the entry into the Term Loan Facility and the application of the proceeds therefrom, including to repurchase all of the Company’s outstanding 11 1 / 8 % Senior Notes due 2014 and all of the outstanding 14 1 / 2 % Senior Discount Notes due 2014 of Holdings, to repay all outstanding indebtedness under the Company’s existing senior secured term loan credit facility and to make a distribution to the indirect shareholders of Holdings all as described in the Preliminary Offering Circular. This agreement (this “Agreement” or the “Purchase Agreement”), the Securities, the DTC Agreement, the Indenture, the Registration Rights Agreement, the Term Loan Facility and the ABL Amendment are collectively referred to herein as the “Transaction Documents.”
The Company understands that the Initial Purchasers propose to make an offering of the Securities on the terms and in the manner set forth herein and in the Pricing Circular (as defined below) and agrees that the Initial Purchasers may resell, subject to the conditions set forth herein, all or a portion of the Securities to purchasers (the “Subsequent Purchasers”) after the Time of Execution. For the purposes of this Agreement, the “Time of Execution” is 1:00 p.m. (Eastern time) on the date of this Purchase Agreement. The Securities are to be offered and sold to or through the Initial Purchasers without being registered with the Securities and Exchange Commission (the “Commission”) under the Securities Act of 1933 (as amended, the “Securities Act,” which term, as used herein, includes the rules and regulations of the Commission promulgated thereunder), in reliance upon exemptions therefrom. Pursuant to the terms of the Securities and the Indenture, investors who acquire Securities shall be deemed to have agreed that Securities may only be resold or otherwise transferred, after the date hereof, if such Securities are registered for sale under the Securities Act or if an exemption from the registration requirements of the Securities Act is available (including the exemptions afforded by Rule 144A under the Securities Act (“Rule 144A”) or Regulation S under the Securities Act (“Regulation S”)).
The Company (i) has prepared and delivered to each Initial Purchaser copies of a Preliminary Offering Circular, dated the date hereof (as may be amended, the “Preliminary Offering Circular”) and (ii) has prepared and delivered to each Initial Purchaser copies of a Pricing Supplement, dated the date hereof (as may be amended, the “Pricing Supplement”), describing the terms of the Securities, each for use by such Initial Purchaser in connection with its solicitation
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of offers to purchase the Securities. The Preliminary Offering Circular and the Pricing Supplement are herein referred to as the “Pricing Circular.” Promptly after the Time of Execution, the Company will prepare and deliver to each Initial Purchaser a final offering circular dated the date hereof (the “Final Offering Circular”). Any reference hereinto the Preliminary Offering Circular or the Final Offering Circular shall be deemed to include all documents incorporated by reference therein on or prior to the date of such circular.
The Company and the Guarantors hereby confirm their agreements with the Initial Purchasers as follows:
SECTION 1. Representations and Warranties. The Company and the Guarantors, jointly and severally, hereby represent, warrant and covenant to each Initial Purchaser that, as of the date hereof and as of the Closing Date (references in this Section 1 to the “Offering Circular” are to (x) the Pricing Circular in the case of representations and warranties made as of the date hereof and (y) the Final Offering Circular in the case of representations and warranties made as of the Closing Date):
(a) No Registration Required. Subject to compliance by the Initial Purchasers with the representations and warranties set forth in Section 2 hereof and with the procedures set forth in Section 7 hereof, it is not necessary in connection with the offer, sale and delivery of the Securities to the Initial Purchasers and to each Subsequent Purchaser in the manner contemplated by this Agreement and the Offering Circular to register the Securities under the Securities Act or, until such time as the Exchange Securities are issued pursuant to an effective registration statement, to qualify the Indenture under the Trust Indenture Act of 1939 (the “Trust Indenture Act,” which term, as used herein, includes the rules and regulations of the Commission promulgated thereunder).
(b) No Integration of Offerings or General Solicitation. None of the Company, its affiliates (as such term is defined in Rule 501 under the Securities Act) (each, an “Affiliate”), or any person acting on its or any of their behalf (other than the Initial Purchasers, as to whom the Company makes no representation or warranty) has, directly or indirectly, solicited any offer to buy or offered to sell, in the United States or to any United States citizen or resident, any security which is or would be integrated with the sale of the Securities in a manner that would require the Securities to be registered under the Securities Act. None of the Company, its Affiliates, or any person acting on its or any of their behalf (other than the Initial Purchasers, as to whom no representation or warranty is made) has engaged or will engage, in connection with the offering of the Securities, in any form of general solicitation or general advertising within the meaning of Rule 502 under the Securities Act. With respect to those Securities sold in reliance upon Regulation S, (i) none of the Company, their respective Affiliates or any person acting on its or their behalf (other than the Initial Purchasers, as to whom no representation or warranty is made) has engaged or will engage in any directed selling efforts within the meaning of Regulation S and (ii) each of the Company and its Affiliates and any person acting on its or their behalf (other than the Initial Purchasers, as to whom no representation or warranty is made) has complied and will comply with the offering restrictions set forth in Regulation S.
(c) Eligibility for Resale under Rule 144A. The Securities are eligible for resale pursuant to Rule 144A and will not be, at the Closing Date, of the same class as securities listed on a
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national securities exchange registered under Section 6 of the Securities Exchange Act of 1934 (as amended, the “Exchange Act,” which term, as used herein, includes the rules and regulations of the Commission promulgated thereunder) or quoted in a U.S. automated interdealer quotation system.
(d) The Offering Circular. The Pricing Circular, as of the Time of Execution, and the Final Offering Circular, as of its date and (as amended or supplemented in accordance with Section 3(a), as applicable) as of the Closing Date, did not and will not, as of their respective dates, contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that this representation, warranty and agreement shall not apply to statements in or omissions from the Pricing Circular, the Final Offering Circular or any amendment or supplement thereto made in reliance upon and in conformity with information furnished to the Company in writing by any Initial Purchaser through Goldman, Sachs & Co. expressly for use in the Pricing Circular, the Final Offering Circular or amendment or supplement thereto, as the case may be. The Pricing Circular contains, and the Final Offering Circular will contain, all the information specified in, and meeting the requirements of, Rule 144A. Neither the Company nor any of the Guarantors has distributed nor will distribute, prior to the later of the Closing Date and the completion of the Initial Purchasers’ distribution of the Securities, any offering material in connection with the offering and sale of the Securities other than the Pricing Circular and the Final Offering Circular.
(e) Additional Written Communications . The Company (including its agents and representatives, other than the Initial Purchasers in their capacity as such) has not prepared, made, used, authorized, approved or referred to and will not prepare, make, use, authorize, approve or refer to any written communication that constitutes an offer to sell or solicitation of an offer to buy the Securities (each such communication by the Company or its agents and representatives (other than a communication referred to in clauses (i), (ii) and (iii) below) an “Issuer Written Communication”) other than (i) the Preliminary Offering Circular, (ii) the Final Offering Circular, (iii) the Pricing Supplement, which constitutes part of the Pricing Circular, and (iv) any electronic road show or other written communications, in each case used in accordance with Section 3(o). Each such Issuer Written Communication, when taken together with the Pricing Circular, did not, and at the Closing Date will not, contain an untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading; provided that this representation, warranty and agreement shall not apply to statements in or omissions from any Issuer Written Communication made in reliance upon and in conformity with information furnished to the Company in writing by any Initial Purchaser through Goldman, Sachs & Co. expressly for use in such Issuer Written Communication.
(f) The Purchase Agreement. This Agreement has been duly authorized, executed and delivered by, and is a valid and binding agreement of the Company and each of the Guarantors.
(g) The DTC Agreement and the Registration Rights Agreement. At the Closing Date each of the DTC Agreement and the Registration Rights Agreement will have been duly authorized, executed and delivered by, and will constitute a valid and binding agreement of, the
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Company and each of the Guarantors, enforceable against the Company and the Guarantors in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights and remedies of creditors or by general equitable principles and except as rights to indemnification under the Registration Rights Agreement may be limited by applicable law.
(h) Authorization of the Notes, the Guarantees and the Exchange Notes. The Notes to be purchased by the Initial Purchasers from the Company are in the form contemplated by the Indenture, have been duly authorized for issuance and sale pursuant to this Agreement and the Indenture and, at the Closing Date, will have been duly executed by the Company, and, when authenticated in the manner provided for in the Indenture and delivered against payment of the purchase price therefor, will constitute valid and binding agreements of the Company, enforceable in accordance with their terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights and remedies of creditors or by general equitable principles and will be entitled to the benefits of the Indenture. The Exchange Notes have been duly and validly authorized for issuance by the Company, and when issued and authenticated in accordance with the terms of the Indenture, the Registration Rights Agreement and the Exchange Offer, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or affecting enforcement of the rights and remedies of creditors or by general principles of equity and will be entitled to the benefits of the Indenture. The Guarantees of the Notes and the Exchange Notes are in the respective forms contemplated by the Indenture, and at the Closing Date will have been duly authorized for issuance and sale pursuant to this Agreement and the Indenture and, duly executed by each of the Guarantors and, when the Notes and the Exchange Notes have been authenticated in the manner provided for in the Indenture and delivered against payment of the purchase price therefor, will constitute valid and binding agreements of the Guarantors, enforceable in accordance with their terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights and remedies of creditors or by general equitable principles and will be entitled to the benefits of the Indenture.
(i) Authorization of the Indenture. On the Closing Date, the Indenture will have been duly authorized, executed and delivered by the Company and each of the Guarantors, and will constitute a valid and binding agreement of the Company and each of the Guarantors, enforceable against the Company and each of the Guarantors in accordance with its terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting the rights and remedies of creditors or by general equitable principles.
(j) Description of the Securities and the Indenture. The Securities, the Exchange Securities and the Indenture will conform in all material respects to the respective statements relating thereto contained in the Offering Circular.
(k) No Material Adverse Change. Except as otherwise disclosed in the Offering Circular, subsequent to the respective dates as of which information is given in the Offering Circular: (i) there has been no material adverse change, or any development that could reasonably be
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expected to result in a material adverse change, in the condition, financial or otherwise, or in the earnings, business, operations or prospects, whether or not arising from transactions in the ordinary course of business, of the Company and its subsidiaries, considered as one entity (any such change is called a “Material Adverse Change”); (ii) the Company and its subsidiaries, considered as one entity, have not incurred any material liability or obligation, indirect, direct or contingent, not in the ordinary course of business nor entered into any material transaction or agreement not in the ordinary course of business; and (iii) there has been no dividend or distribution of any kind declared, paid or made by the Company or, except for dividends paid to the Company or other subsidiaries, any of its subsidiaries on any class of capital stock or repurchase or redemption by the Company or any of its subsidiaries of any class of capital stock.
(l) Independent Accountants. Deloitte & Touche LLP, which expressed its opinion with respect to the financial statements (which term as used in this Agreement includes the related notes thereto) included in the Offering Circular are independent public or certified public accountants within the meaning of Regulation S-X under the Securities Act and the Exchange Act and within the applicable rules and regulations adopted by the Public Company Accounting Oversight Board (United States) and the Commission, and any non-audit services provided by Deloitte & Touche LLP to the Company or any of the Guarantors have been approved by the Audit Committee of the Board of Directors of the Company.
(m) Preparation of the Financial Statements. The financial statements, together with the related schedules and notes, included in the Offering Circular present fairly the consolidated financial position of the entities to which they relate as of and at the dates indicated and the results of their operations and cash flows for the periods specified. Such financial statements have been prepared in conformity with generally accepted accounting principles, as applied in the United States, on a consistent basis throughout the periods involved, except as may be expressly stated in the related notes thereto. The financial data set forth in the Offering Circular under the captions “Summary—Summary Historical Consolidated Financial Data” and “Selected Historical Consolidated Financial Data” fairly present the information set forth therein on a basis consistent with that of the audited financial statements contained in the Offering Circular.
(n) Organization and Good Standing of Holdings, the Company and its Subsidiaries. Each of Holdings, the Company and its subsidiaries has been duly organized and is validly existing as a corporation, partnership or limited liability company, as the case may be, in good standing under the laws of the jurisdiction of its incorporation (except for such jurisdictions where the failure to be in good standing would not, individually or in the aggregate, result in a Material Adverse Change) and has corporate power and authority to own, lease and operate its properties and to conduct its business as described in the Offering Circular and, in the case of the Company and the Guarantors, to enter into and perform its obligations under each of the Transaction Documents. Each of the Company and each subsidiary is duly qualified as a foreign corporation, partnership or limited liability company, as the case may be, to transact business and is in good standing or equivalent status in each jurisdiction in which such qualification is required, whether by reason of the ownership or leasing of property or the conduct of business, except for such jurisdictions where the failure to so qualify or to be in good standing would not, individually or in the aggregate, result in a Material Adverse Change. All of the issued and outstanding capital stock of each subsidiary has been duly authorized and validly issued, is fully paid and nonassessable and is owned by the Company, directly or through subsidiaries, free and clear of any security
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interest, mortgage, pledge, lien, encumbrance or claim other than liens securing the Senior Secured Credit Facilities. As of the date hereof, the Company does not own or control, directly or indirectly, any corporation, association or other entity, and as of the Closing Date the Company will not own or control, directly or indirectly, any corporation, association or other entity other than the subsidiaries listed in Schedule B hereto.
(o) Capitalization and Other Capital Stock Matters. At October 30, 2010, on a consolidated basis, after giving pro forma effect to the issuance and sale of the Securities pursuant hereto, the Company would have an authorized and outstanding capitalization as set forth in the Offering Circular under the caption “Capitalization” (other than for subsequent issuances of capital stock, if any, pursuant to employee benefit plans described in the Offering Circular or upon exercise of outstanding options described in the Offering Circular).
(p) Non-Contravention of Existing Instruments; No Further Authorizations or Approvals Required. None of Holdings, the Company or any of its subsidiaries is in violation of its charter or bylaws or similar organizational documents or is in default (or, with the giving of notice or lapse of time, would be in default) (“Default”) under any indenture, mortgage, loan or credit agreement, note, contract, franchise, lease or other instrument to which Holdings, the Company or any of its subsidiaries is a party or by which it or any of them may be bound, or to which any of the property or assets of Holdings, the Company or any of its subsidiaries is subject (each, an “Existing Instrument”), except for such Defaults as would not, individually or in the aggregate, result in a Material Adverse Change. Each of the Company and the Guarantors’ execution, delivery and performance of the Transaction Documents and consummation of the transactions contemplated hereby and thereby and by the Offering Circular (i) have been duly authorized by all necessary corporate action and will not result in any violation of the provisions of the charter or bylaws or similar organizational documents of the Company or any subsidiary, (ii) will not conflict with or constitute a breach of, or Default or a Debt Repayment Triggering Event (as defined below) under, or result in the creation or imposition of any lien, charge or encumbrance upon any property or assets of Holdings, the Company or any of its subsidiaries (other than liens securing the Senior Secured Credit Facilities) pursuant to, or require the consent of any other party to, any Existing Instrument, except for such conflicts, breaches, Defaults, liens, charges or encumbrances as would not, individually or in the aggregate, result in a Material Adverse Change and (iii) will not result in any violation of any law, administrative regulation or administrative or court decree applicable to Holdings, the Company or any subsidiary. No consent, approval, authorization or other order of, or registration or filing with, any court or other governmental or regulatory authority or agency, is required for the Company’s or any Guarantor’s execution, delivery and performance of the Transaction Documents or consummation of the transactions contemplated hereby and thereby and by the Offering Circular, except such as have been obtained or made by the Company and are in full force and effect under the Securities Act, applicable securities laws of the several states of the United States and except such as may be required by the securities laws of the several states of the United States with respect to the Company’s obligations under the Registration Rights Agreement. As used herein, a “Debt Repayment Triggering Event” means any event or condition which gives, or with the giving of notice or lapse of time would give, the holder of any note, debenture or other evidence of indebtedness (or any person acting on such holder’s behalf) the right to require the repurchase, redemption or repayment of all or a portion of such indebtedness by Holdings, the Company or any of its subsidiaries.
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(q) No Material Actions or Proceedings. Except as otherwise disclosed in the Offering Circular, there are no legal or governmental actions, suits or proceedings pending or, to the best of the Company’s knowledge, threatened (i) against or affecting Holdings, the Company or any of its subsidiaries or (ii) which has as the subject thereof any property owned or leased by Holdings, the Company or any of its subsidiaries, where in any such case there is a reasonable possibility that such action, suit or proceeding could be determined adversely to Holdings, the Company or such subsidiary and, if determined adversely to Holdings, the Company or such subsidiary, would reasonably be expected to result in a Material Adverse Change or adversely affect the consummation of the transactions contemplated by this Agreement. No material labor dispute with the employees of the Company or any of its subsidiaries exists or, to the best of the Company’s knowledge, is threatened or imminent.
(r) Intellectual Property Rights. The Company and its subsidiaries own or possess sufficient trademarks, trade names, patent rights, copyrights, licenses, approvals, trade secrets and other similar rights (collectively, “Intellectual Property Rights”) reasonably necessary to conduct their businesses as now conducted; and the expected expiration of any of such Intellectual Property Rights would not result in a Material Adverse Change. Neither the Company nor any of its subsidiaries has received any written notice of infringement or conflict with asserted Intellectual Property Rights of others, which infringement or conflict, if the subject of an unfavorable decision, would result in a Material Adverse Change.
(s) All Necessary Permits, etc. The Company and each subsidiary possess such valid and current certificates, authorizations or permits issued by the appropriate state, federal or foreign regulatory agencies or bodies necessary to conduct their respective businesses, and neither the Company nor any subsidiary has received any notice of proceedings relating to the revocation or modification of, or non-compliance with, any such certificate, authorization or permit which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would result in a Material Adverse Change.
(t) Title to Properties. The Company and each of its subsidiaries has good and marketable title to all the properties and assets reflected as owned in the financial statements referred to in Section 1(m) hereof (or elsewhere in the Offering Circular), in each case free and clear of any security interests, mortgages, liens, encumbrances, equities, claims and other defects, except for (i) liens securing the Senior Secured Credit Facilities and (ii) such liens as do not materially and adversely affect the value of such property and do not materially interfere with the use made or proposed to be made of such property by the Company or such subsidiary. The real property, improvements, equipment and personal property held under lease by the Company or any subsidiary are held under valid and enforceable leases, with such exceptions as are not material and do not materially interfere with the use made or proposed to be made of such real property, improvements, equipment or personal property by the Company or such subsidiary.
(u) Tax Law Compliance. Holdings, the Company and their subsidiaries have filed all necessary federal, state and foreign income and franchise tax returns or have properly requested extensions thereof and have paid all taxes required to be paid by any of them and, if due and payable, any related or similar assessment, fine or penalty levied against any of them except (i) for any payments as may be being contested in good faith and by appropriate proceedings and for which the Company has established adequate reserves in accordance with generally accepted
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accounting principles in the United States or (ii) where the failure to make such filings or payment would not, individually or in the aggregate, result in a Material Adverse Change. Holdings and the Company have made adequate charges, accruals and reserves in the applicable financial statements referred to in Section 1(m) hereof in respect of all federal, state and foreign income and franchise taxes for all periods as to which the tax liability of Holdings and the Company or any of their subsidiaries have not been finally determined, except to the extent of any inadequacy that would not, individually or in the aggregate, result in a Material Adverse Change.
(v) Company Not an “Investment Company”. The Company has been advised of the rules and requirements under the Investment Company Act of 1940, as amended (the “Investment Company Act,” which term, as used herein, includes the rules and regulations of the Commission promulgated thereunder). The Company is not, and after receipt of payment for the Securities will not be, an “investment company” within the meaning of Investment Company Act, and the Company will conduct its business in a manner so that it will not become subject to the Investment Company Act.
(w) Insurance. Each of the Company and its subsidiaries are insured by recognized, financially sound institutions with policies in such amounts and with such deductibles and covering such risks as are generally deemed adequate and customary for their businesses including, without limitation, policies covering real and personal property owned or leased by the Company and its subsidiaries against theft, damage, destruction, acts of vandalism, floods and earthquakes. The Company has no reason to believe that it or any subsidiary will not be able (i) to renew its existing insurance coverage as and when such policies expire or (ii) to obtain comparable coverage from similar institutions as may be necessary or appropriate to conduct its business as now conducted and at a cost that would not result in a Material Adverse Change. Neither of the Company nor any subsidiary has been denied any insurance coverage which it has sought or for which it has applied.
(x) No Price Stabilization or Manipulation. None of the Company or any of the Guarantors has taken or will take, directly or indirectly, any action designed to or that might be reasonably expected to cause or result in stabilization or manipulation of the price of any security of the Company to facilitate the sale or resale of the Securities.
(y) Solvency. The Company and the Guarantors, taken as a whole are, and immediately after the Closing Date will be, Solvent. As used herein, the term “Solvent” means, with respect to any person on a particular date, that on such date (i) the fair market value of the assets of such person is greater than the total amount of liabilities (including contingent liabilities) of such person, (ii) the present fair salable value of the assets of such person is greater than the amount that will be required to pay the probable liabilities of such person on its debts as they become absolute and matured, (iii) such person is able to realize upon its assets and pay its debts and other liabilities, including contingent obligations, as they mature and (iv) such person does not have unreasonably small capital.
(z) Compliance with Sarbanes-Oxley. The Company and its subsidiaries and their respective officers and directors are in compliance with the applicable provisions of the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act,” which term, as used herein, includes the rules and regulations of the Commission promulgated thereunder).
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(aa) Company’s Accounting System. The Company and its subsidiaries maintain a system of accounting controls that is in compliance with the Sarbanes-Oxley Act and is sufficient to provide reasonable assurances that: (i) transactions are executed in accordance with management’s general or specific authorization; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain accountability for assets; (iii) access to assets is permitted only in accordance with management’s general or specific authorization; and (iv) the recorded accountability for assets is compared with existing assets at reasonable intervals and appropriate action is taken with respect to any differences.
(bb) Disclosure Controls and Procedures . The Company has established and maintains disclosure controls and procedures (as such term is defined in Rules 13a-15 and 15d-14 under the Exchange Act); such disclosure controls and procedures are designed to ensure that material information relating to the Company and its subsidiaries is made known to the chief executive officer and chief financial officer of the Company by others within the Company or any of its subsidiaries, and such disclosure controls and procedures are reasonably effective to perform the functions for which they were established subject to the limitations of any such control system; the Company’s auditors and the Audit Committee of the Board of Directors of the Company have been advised of: (i) any significant deficiencies or material weaknesses in the design or operation of internal controls which could adversely affect the Company’s ability to record, process, summarize, and report financial data; and (ii) any fraud, whether or not material, that involves management or other employees who have a role in the Company’s internal controls; and since the date of the most recent evaluation of such disclosure controls and procedures, there have been no significant changes in internal controls or in other factors that could significantly affect internal controls, including any corrective actions with regard to significant deficiencies and material weaknesses.
(cc) Compliance with Environmental Laws. Except as would not, individually or in the aggregate, result in a Material Adverse Change: (i) neither the Company nor any of its subsidiaries is in violation of any federal, state, local or foreign law or regulation relating to pollution or protection of human health or the environment (including, without limitation, ambient air, surface water, groundwater, land surface or subsurface strata) or wildlife, including, without limitation, laws and regulations relating to emissions, discharges, releases or threatened releases of chemicals, pollutants, contaminants, wastes, toxic substances, hazardous substances, petroleum and petroleum products (collectively, “Materials of Environmental Concern”), or otherwise relating to the manufacture, processing, distribution, use, treatment, storage, disposal, transport or handling of Materials of Environmental Concern (collectively, “Environmental Laws”), which violation includes, without limitation, noncompliance with any permits or other governmental authorizations required for the operation of the business of the Company or its subsidiaries under applicable Environmental Laws, or noncompliance with the terms and conditions thereof, nor has the Company or any of its subsidiaries received any written communication, whether from a governmental authority, citizens group, employee or otherwise, that alleges that the Company or any of its subsidiaries is in violation of any Environmental Law; (ii) there is no claim, action or cause of action filed with a court or governmental authority, no investigation with respect to which the Company has received written notice, and no written notice by any person or entity alleging potential liability for investigatory costs, cleanup costs, governmental responses costs, natural resources damages, property damages, personal injuries, attorneys’ fees or penalties
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arising out of, based on or resulting from the presence, or release into the environment, of any Material of Environmental Concern at any location owned, leased or operated by the Company or any of its subsidiaries, now or in the past (collectively, “Environmental Claims”), pending or, to the Company’s knowledge, threatened against the Company or any of its subsidiaries or any person or entity whose liability for any Environmental Claim the Company or any of its subsidiaries has retained or assumed either contractually or by operation of law; and (iii) to the Company’s knowledge, there are no past or present actions, activities, circumstances, conditions, events or incidents, including, without limitation, the release, emission, discharge, presence or disposal of any Material of Environmental Concern, that would result in a violation of any Environmental Law or form the basis of a potential Environmental Claim against the Company or any of its subsidiaries or against any person or entity whose liability for any Environmental Claim the Company or any of its subsidiaries has retained or assumed either contractually or by operation of law.
(dd) Periodic Review of Costs of Environmental Compliance. In the ordinary course of its business, the Company conducts a periodic review of the effect of Environmental Laws on the business, operations and properties of the Company and its subsidiaries, in the course of which it identifies and evaluates associated costs and liabilities (including, without limitation, any capital or operating expenditures required for clean-up, closure of properties or compliance with Environmental Laws or any permit, license or approval, any related constraints on operating activities and any potential liabilities to third parties). On the basis of such review and the amount of its established reserves, the Company has reasonably concluded that such associated costs and liabilities would not, individually or in the aggregate, result in a Material Adverse Change.
(ee) ERISA Compliance. The Company and its subsidiaries and any “employee benefit plan” (as defined under the Employee Retirement Income Security Act of 1974 (as amended, “ERISA,” which term, as used herein, includes the regulations and published interpretations thereunder) established or maintained by the Company, its subsidiaries or their “ERISA Affiliates” (as defined below) are in compliance in all material respects with ERISA. “ERISA Affiliate” means, with respect to the Company or a subsidiary, any member of any group of organizations described in Section 414 of the Internal Revenue Code of 1986 (as amended, the “Code,” which term, as used herein, includes the regulations and published interpretations thereunder) of which the Company or such subsidiary is a member. No “reportable event” (as defined under ERISA) has occurred or is reasonably expected to occur with respect to any “employee benefit plan” established or maintained by the Company, its subsidiaries or any of their ERISA Affiliates. No “employee benefit plan” established or maintained by the Company, its subsidiaries or any of their ERISA Affiliates, if such “employee benefit plan” were terminated, would have any material “amount of unfunded benefit liabilities” (as defined under ERISA). Neither the Company, its subsidiaries nor any of their ERISA Affiliates has incurred or reasonably expects to incur any material liability under (i) Title IV of ERISA with respect to termination of, or withdrawal from, any “employee benefit plan” or (ii) Sections 412, 4971, 4975 or 4980B of the Code. Each “employee benefit plan” established or maintained by the Company, its subsidiaries or any of their ERISA Affiliates that is intended to be qualified under Section 401 of the Code is so qualified and nothing has occurred, whether by action or failure to act, which would cause the loss of such qualification.
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(ff) Compliance with Labor Laws . Except as would not, individually or in the aggregate, result in a Material Adverse Change, (i) there is (A) no material unfair labor practice complaint pending or, to the Company’s knowledge, threatened against the Company or any of its subsidiaries before the National Labor Relations Board, and no material grievance or arbitration proceeding arising out of or under collective bargaining agreements pending, or to the Company’s knowledge, threatened, against the Company or any of its subsidiaries, (B) no strike, labor dispute, slowdown or stoppage pending or, to the Company’s knowledge, threatened against the Company or any of its subsidiaries and (C) no union representation question existing with respect to the employees of the Company or any of its subsidiaries and, to the Company’s knowledge, no union organizing activities taking place and (ii) there has been no material violation of any federal, state or local law relating to discrimination in hiring, promotion or pay of employees or of any applicable wage or hour laws.
(gg) Related Party Transactions . Except as otherwise disclosed in the Offering Circular under the caption “Certain Relationships and Related Transactions, and Director Independence,” no relationship, direct or indirect, exists between or among the Company or any of its affiliates, on the one hand, and any director, officer, member, stockholder, customer or supplier of the Company or any of its affiliates, on the other hand, which is required by the Securities Act to be disclosed in a registration statement on Form S-1 which is not so disclosed in the Offering Circular. Except as otherwise disclosed in the Offering Circular under the caption “Certain Relationships and Related Transactions, and Director Independence” there are no outstanding loans, advances (except advances for business expenses in the ordinary course of business) or guarantees of indebtedness by the Company or any of their respective affiliates to or for the benefit of any of the officers or directors of the Company or any of their respective affiliates or any of their respective family members.
(hh) No Unlawful Contributions or Other Payments. None of the Company or any of its subsidiaries has made any contribution or other payment to any official of, or candidate for, any federal, state or foreign office in violation of any law or of the character necessary to be disclosed in the Offering Circular in order to make the statements therein not misleading.
(ii) FCPA . None of Holdings, the Company or any of their subsidiaries or, to the knowledge of Holdings or the Company, any director, officer, agent, employee or affiliate of Holdings or the Company or any of their subsidiaries is aware of or has taken any action, directly or indirectly, that would result in a violation by such persons of the FCPA, including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization of the payment of any money, or other property, gift, promise to give, or authorization of the giving of anything of value to any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political office, in contravention of the FCPA and Holdings, the Company, their subsidiaries and, to the knowledge of Holdings and the Company, their affiliates have conducted their businesses in compliance with the FCPA and have instituted and maintain policies and procedures designed to ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.
“FCPA” means Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder.
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(jj) No Conflict with Money Laundering Laws . The operations of the Company and its subsidiaries are and have been conducted at all times in compliance with applicable financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the money laundering statutes of all applicable jurisdictions, the rules and regulations thereunder and any related or similar rules, regulations or guidelines issued, administered or enforced by any governmental agency (collectively, the “Money Laundering Laws”) and no action, suit or proceeding by or before any court or governmental agency, authority or body or any arbitrator involving the Company or any of its subsidiaries with respect to the Money Laundering Laws is pending or, to the best knowledge of the Company, threatened.
(kk) No Conflict with OFAC Laws . Neither the Company nor any of its subsidiaries nor, to the knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or any of its subsidiaries is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department (“OFAC”); and the Company will not directly or indirectly use the proceeds of the offering, or lend, contribute or otherwise make available such proceeds to any subsidiary, joint venture partner or other person or entity, for the purpose of financing the activities of any person currently subject to any U.S. sanctions administered by OFAC.
(ll) Regulation S. The Company, the Guarantors and their respective affiliates and all persons acting on their behalf (other than the Initial Purchasers, as to whom no representation is made) have complied with and will comply with the offering restrictions requirements of Regulation S in connection with the offering of the Securities outside the United States and, in connection therewith, the Offering Circular will contain the disclosure required by Rule 902.
(mm) Incorporated Document. At the time they were or hereafter are filed with the Commission, the documents incorporated or deemed to be incorporated by reference in the Offering Circular complied and will comply in all material respects with the requirements of the Exchange Act.
Any certificate signed by an officer of the Company or any Guarantor and delivered to the Initial Purchasers or to counsel for the Initial Purchasers shall be deemed to be a representation and warranty by the Company or such Guarantor to each Initial Purchaser as to the matters set forth therein.
SECTION 2. Purchase, Sale and Delivery of the Securities .
(a) The Securities. The Company agrees to issue and sell to the Initial Purchasers, severally and not jointly, all of the Securities, and the Initial Purchasers agree, severally and not jointly, to purchase from the Company the aggregate principal amount of Securities set forth opposite their names on Schedule A, at a purchase price of 98.25% of the gross proceeds thereof payable on the Closing Date, in each case, on the basis of the representations, warranties and agreements herein contained, and upon the terms, subject to the conditions thereto, herein set forth.
(b) The Closing Date. Delivery of certificates for the Securities in definitive form to be purchased by the Initial Purchasers and payment therefor shall be made at the offices of
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Kirkland & Ellis LLP (or such other place as may be agreed to by the Company and Goldman, Sachs & Co.) at 10:00 a.m. New York City time, on February 24, 2011, or such other time and date as Goldman, Sachs & Co. shall designate by notice to the Company (the time and date of such closing are called the “Closing Date”). The Company hereby acknowledges that circumstances under which Goldman, Sachs & Co. may provide notice to postpone the Closing Date as originally scheduled include, but are in no way limited to, any determination by the Company or the Initial Purchasers to recirculate to investors copies of an amended or supplemented Offering Circular or a delay as contemplated by the provisions of Section 16 hereof.
(c) Delivery of the Securities. The Company shall deliver, or cause to be delivered, to Goldman, Sachs & Co. for the accounts of the several Initial Purchasers certificates for the Notes at the Closing Date against the irrevocable release of a wire transfer of immediately available funds for the amount of the purchase price therefor. The certificates for the Notes shall be in such denominations and registered in the name of Cede & Co., as nominee of the Depositary, and shall be made available for inspection on the business day preceding the Closing Date at a location in New York City, as Goldman, Sachs & Co. may designate. Time shall be of the essence, and delivery at the time and place specified in this Agreement is a further condition to the obligations of the Initial Purchasers.
(d) Initial Purchasers as Qualified Institutional Buyers. Each Initial Purchaser severally and not jointly represents and warrants to, and agrees with, the Company that it is a “qualified institutional buyer” within the meaning of Rule 144A (a “Qualified Institutional Buyer”).
SECTION 3. Additional Covenants. The Company and each of the Guarantors jointly and severally covenant and agree with each Initial Purchaser as follows:
(a) Preparation of Final Offering Circular; Initial Purchasers’ Review of Proposed Amendments and Supplements. As promptly as practicable following the Time of Execution and in any event not later than the second business day following the date hereof, the Company will prepare and deliver to the Initial Purchasers the Final Offering Circular, which shall be materially consistent of the Preliminary Offering Circular as modified only by the information contained in the Pricing Supplement. The Company will not amend or supplement the Preliminary Offering Circular or the Pricing Supplement. The Company will not amend or supplement the Final Offering Circular prior to the Closing Date or the completion of the placement of the Securities by the Initial Purchasers with the Subsequent Purchasers unless the Initial Purchasers shall previously have been furnished a copy of the proposed amendment or supplement at least two business days prior to the proposed use or filing, and shall not have objected to such amendment or supplement.
(b) Amendments and Supplements to the Pricing Circular, Final Offering Circular and Other Securities Act Matters. If, prior to the later of (x) the Closing Date and (y) the completion of the placement of the Securities by the Initial Purchasers with the Subsequent Purchasers, any event shall occur or condition exist as a result of which it is necessary to amend or supplement the Pricing Circular or the Final Offering Circular, as applicable, as then amended or supplemented, in order to make the statements therein, in the light of the circumstances when the Pricing Circular or the Final Offering Circular, as applicable, is delivered to a Subsequent Purchaser, not misleading, or if in the judgment of the Initial Purchasers or counsel for the Initial
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Purchasers it is otherwise necessary to amend or supplement Pricing Circular or the Final Offering Circular to comply with law, the Company agrees to promptly prepare (subject to Section 3 hereof), furnish at its own expense to the Initial Purchasers, amendments or supplements to the Pricing Circular or Final Offering Circular, as applicable, so that the statements in the Pricing Circular or Final Offering Circular, as applicable, as so amended or supplemented will not, in the light of the circumstances at the Closing Date and at the time of sale of Securities, be misleading or so that the Final Offering Circular, as amended or supplemented, will comply with all applicable law.
The Company hereby expressly acknowledges that the indemnification and contribution provisions of Sections 8 and 9 hereof are specifically applicable and relate to each offering memorandum, prospectus, amendment or supplement referred to in this Section 3.
(c) Copies of the Offering Circular. The Company agrees to furnish the Initial Purchasers, without charge, as many copies of the Pricing Circular and the Final Offering Circular and any amendments and supplements thereto as they shall have reasonably requested.
(d) Blue Sky Compliance. Each of the Company and the Guarantors shall cooperate with the Initial Purchasers and counsel for the Initial Purchasers to qualify or register (or to obtain exemptions from qualifying or registering) all or any part of the Securities for offer and sale under the securities laws of the several states of the United States, the provinces of Canada or any other jurisdictions designated by the Initial Purchasers, shall comply with such laws and shall continue such qualifications, registrations and exemptions in effect so long as required for the distribution of the Securities. None of the Company or any of the Guarantors shall be required to qualify as a foreign corporation or to take any action that would subject it to general service of process in any such jurisdiction where it is not presently qualified or where it would be subject to taxation as a foreign corporation. The Company will advise the Initial Purchasers promptly of the suspension of the qualification or registration of (or any such exemption relating to) the Securities for offering, sale or trading in any jurisdiction or any initiation or threat of any proceeding for any such purpose, and in the event of the issuance of any order suspending such qualification, registration or exemption, each of the Company and the Guarantors shall use its commercially reasonable efforts to obtain the withdrawal thereof at the earliest possible moment.
(e) Use of Proceeds. The Company shall apply the net proceeds from the sale of the Securities in the manner described under the caption “Use of Proceeds” in the Pricing Circular.
(f) The Depositary. The Company will cooperate with the Initial Purchasers and use its commercially reasonable efforts to permit the Securities to be eligible for clearance and settlement through the facilities of the Depositary.
(g) Additional Issuer Information. At any time when the Company is not subject to Section 13 or 15 of the Exchange Act, for the benefit of holders and beneficial owners from time to time of the Securities, the Company and the Guarantors shall furnish, at their expense, upon request, to holders and beneficial owners of Securities and prospective purchasers of Securities information (“Additional Issuer Information”) satisfying the requirements of Rule 144A(d).
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(h) Agreement Not To Offer or Sell Additional Securities. During the period of 90 days following the date hereof, none of the Company or the Guarantors shall, without the prior written consent of Goldman, Sachs & Co. (which consent may be withheld at the sole discretion of Goldman, Sachs & Co.), directly or indirectly, sell, offer, contract or grant any option to sell, pledge, transfer or establish an open “put equivalent position” within the meaning of Rule 16a-1 under the Exchange Act, or otherwise dispose of or transfer, or announce the offering of, or file any registration statement under the Securities Act in respect of, any debt securities of the Company or any Guarantor or securities exchangeable for or convertible into debt securities of the Company or any Guarantor (other than as contemplated by this Agreement and to register the Exchange Securities).
(i) Future Reports to the Initial Purchasers. At any time when the Company is not subject to Section 13 or 15 of the Exchange Act and any Securities or Exchange Securities remain outstanding, the Company will furnish to Goldman, Sachs & Co., as soon as available, copies of any report or communication of the Company mailed generally to holders of its capital stock or debt securities (including the holders of the Securities), if, in each case, such documents are not filed with the Commission within the time periods specified by the Commission’s rules and regulations under Section 13 or 15 of the Exchange Act.
(j) No Integration. The Company agrees that it will not and will cause its Affiliates not to make any offer or sale of securities if, as a result of the doctrine of “integration” referred to in Rule 502 under the Securities Act, such offer or sale would render invalid (for the purpose of (i) the sale of the Securities by the Company to the Initial Purchasers, (ii) the resale of the Securities by the Initial Purchasers to Subsequent Purchasers or (iii) the resale of the Securities by such Subsequent Purchasers to others) the exemption from the registration requirements of the Securities Act provided by Section 4(2) thereof or by Rule 144A or by Regulation S thereunder or otherwise.
(k) No Restricted Resales . During the period of one year after the Closing Date, the Company will not, and will not permit any of their respective affiliates (as defined in Rule 144 under the Securities Act) to resell any of the Notes which constitute “restricted securities” under Rule 144 that have been reacquired by any of them.
(l) Legended Securities. Each certificate for a Note will bear the legend contained in “Notice to Investors” in the Preliminary Offering Circular for the time period and upon the other terms stated in the Preliminary Offering Circular.
(m) No General Solicitation or Directed Selling Efforts . None of the Company or any of its affiliates or any other person acting on its or their behalf (other than the Initial Purchasers, as to which no covenant is given) will (i) solicit offers for, or offer or sell, the Securities by means of any form of general solicitation or general advertising within the meaning of Rule 502(c) of Regulation D or in any manner involving a public offering within the meaning of Section 4(2) of the Securities Act or (ii) engage in any directed selling efforts within the meaning of Regulation S, and all such persons will comply with the offering restrictions requirement of Regulation S.
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(n) No Stabilization . Neither the Company nor any of the Guarantors will take, directly or indirectly, any action designed to or that could reasonably be expected to cause or result in any stabilization or manipulation of the price of the Securities.
(o) Additional Written Communications . Before making, preparing, using, authorizing, approving or referring to any Issuer Written Communication, the Company will furnish to Goldman, Sachs & Co. and counsel for the Initial Purchasers a copy of such written communication for review and will not make, prepare, use, authorize, approve or refer to any such written communication to which Goldman, Sachs & Co. reasonably objects.
Goldman, Sachs & Co., on behalf of the several Initial Purchasers, may, in its sole discretion, waive in writing the performance by the Company or any Guarantor of any one or more of the foregoing covenants or extend the time for their performance.
SECTION 4. Payment of Expenses. The Company and each of the Guarantors jointly and severally agree to pay all costs, fees and expenses incurred in connection with the performance of its obligations hereunder and in connection with the transactions contemplated hereby, including, without limitation, (i) all expenses incident to the issuance and delivery of the Securities (including all printing and engraving costs), (ii) all necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the Securities to the Initial Purchasers, (iii) all fees and expenses of the Company’s counsel, independent public or certified public accountants and other advisors, (iv) all costs and expenses incurred in connection with the preparation, printing, filing, shipping and distribution of the Pricing Circular and the Final Offering Circular (including financial statements and exhibits), and all amendments and supplements thereto, this Agreement, the Registration Rights Agreement, the Indenture, the Notes and Guarantees, (v) all filing fees, attorneys’ fees and expenses incurred by the Company, the Guarantors or the Initial Purchasers (in the case of expenses incurred by the Initial Purchasers, in an amount not to exceed $15,000) in connection with qualifying or registering (or obtaining exemptions from the qualification or registration of) all or any part of the Securities for offer and sale under the securities laws of the several states of the United States, the provinces of Canada or other jurisdictions designated by the Initial Purchasers (including, without limitation, the cost of preparing, printing and mailing preliminary and final blue sky or legal investment memoranda and any related supplements to the Pricing Circular or the Final Offering Circular), (vi) the fees and expenses of the Trustees, including the fees and disbursements of counsel for the Trustees in connection with the Indenture, the Securities and the Exchange Securities, (vii) any fees payable in connection with the rating of the Securities or the Exchange Securities with the ratings agencies, (viii) all fees and expenses (including reasonable fees and expenses of counsel) of the Company and the Guarantors in connection with approval of the Securities by the Depositary for “book-entry” transfer, and the performance by the Company and the Guarantors of their respective other obligations under this Agreement and (ix) one-half of all expenses incident to the “road show” for the offering of the Securities, including the cost of any chartered airplane or other transportation. Except as provided in this Section 4 and Sections 6, 8 and 9 hereof, the Initial Purchasers shall pay their own expenses, including the fees and disbursements of their counsel.
SECTION 5. Conditions of the Obligations of the Initial Purchasers. The obligations of the several Initial Purchasers to purchase and pay for the Securities as provided herein on the Closing Date shall be subject to the accuracy of the representations and warranties on the part of
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the Company and the Guarantors set forth in Section 1 hereof as of the date hereof and as of the Closing Date as though then made and to the timely performance by the Company and the Guarantors, as applicable, of their covenants and other obligations hereunder, and to each of the following additional conditions:
(a) Accountants’ Comfort Letter. On the date hereof, the Initial Purchasers shall have received from Deloitte & Touche LLP, independent public or certified public accountants for the Company, a “comfort letter” dated the date hereof addressed to the Initial Purchasers, in form and substance reasonably satisfactory to the Initial Purchasers, covering the financial information in the Preliminary Offering Circular, the Supplement, the Pricing Supplement and other customary matters. In addition, on the Closing Date, the Initial Purchasers shall have received from such accountants, a “bring-down comfort letter” dated the Closing Date addressed to the Initial Purchasers, in form and substance satisfactory to the Initial Purchasers, in the form of the “comfort letter” delivered on the date hereof, except that (i) it shall cover the financial information in the Final Offering Circular and any amendment or supplement thereto and (ii) procedures shall be brought down to a date no more than three business days prior to the Closing Date.
(b) No Material Adverse Change or Ratings Agency Change. For the period from and after the date of this Agreement and prior to the Closing Date:
(i) in the judgment of the Initial Purchasers there shall not have occurred any Material Adverse Change; and
(ii) there shall not have occurred any downgrading, nor shall any notice have been given of any intended or potential downgrading or of any review for a possible change that does not indicate the direction of the possible change, in the rating accorded any securities or indebtedness of the Company or any of its subsidiaries by any “nationally recognized statistical rating organization” as such term is defined for purposes of Rule 436 under the Securities Act.
(c) Opinion of Counsel for the Company. On the Closing Date the Initial Purchasers shall have received the favorable opinion of Kirkland & Ellis LLP, counsel for the Company and the Guarantors, dated as of such Closing Date, in form and substance reasonably satisfactory to the Initial Purchasers.
(d) Opinion of Counsel for the Initial Purchasers. On the Closing Date the Initial Purchasers shall have received the favorable opinion of Cahill Gordon & Reindel LLP , counsel for the Initial Purchasers, dated as of such Closing Date, with respect to such matters as may be reasonably requested by the Initial Purchasers.
(e) Officers’ Certificate. On the Closing Date the Initial Purchasers shall have received a written certificate executed by the Chief Executive Officer or President of the Company and the Chief Financial Officer or Chief Accounting Officer of the Company, dated as of the Closing Date, to the effect set forth in Section 5(b)(ii) hereof, and further to the effect that:
(i) for the period from and after the date of this Agreement and prior to the Closing Date there has not occurred any Material Adverse Change;
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(ii) the representations, warranties and covenants of the Company and the Guarantors set forth in Section 1 hereof were true and correct as of the Time of Execution and are true and correct as of the Closing Date with the same force and effect as though expressly made on and as of the Closing Date; and
(iii) the Company and the Guarantors have complied with all the agreements and satisfied all the conditions on their part to be performed or satisfied at or prior to the Closing Date.
(f) Registration Rights Agreement. The Company and the Guarantors shall have entered into the Registration Rights Agreement and the Initial Purchasers shall have received executed counterparts thereof.
(g) Transactions and Proceedings. The Transactions shall have been consummated on the terms and conditions described in the Pricing Circular. All corporate proceedings and other legal matters incident to the authorization, form and validity of each of the Transaction Documents shall be reasonably satisfactory in all material respects to the Initial Purchasers, and the Company shall have furnished to the Initial Purchasers all documents and information that they or their counsel may reasonably request to enable them to pass upon such matters.
(h) Additional Documents. On or before the Closing Date, the Initial Purchasers and counsel for the Initial Purchasers shall have received such information, documents and opinions as they may reasonably require for the purposes of enabling them to pass upon the issuance and sale of the Securities as contemplated herein, or in order to evidence the accuracy of any of the representations and warranties, or the satisfaction of any of the conditions or agreements, herein contained.
If any condition specified in this Section 5 is not satisfied when and as required to be satisfied, this Agreement may be terminated by the Initial Purchasers by notice to the Company at any time on or prior to the Closing Date, which termination shall be without liability on the part of any party to any other party, except that Sections 4, 6, 8 and 9 hereof shall at all times be effective and shall survive such termination.
SECTION 6. Reimbursement of Initial Purchasers’ Expenses. If this Agreement is terminated by the Initial Purchasers pursuant to Section 5 or 10 hereof, including if the sale to the Initial Purchasers of the Securities on the Closing Date is not consummated because of any refusal, inability or failure on the part of the Company or the Guarantors to perform any agreement herein or to comply with any provision hereof, the Company and the Guarantors jointly and severally agree to reimburse the Initial Purchasers (or such Initial Purchasers as have terminated this Agreement with respect to themselves), severally, upon demand for all out-of-pocket expenses that shall have been reasonably incurred by the Initial Purchasers in connection with the proposed purchase and the offering and sale of the Securities, including, without limitation, fees and disbursements of counsel, printing expenses, travel expenses, postage, facsimile and telephone charges.
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SECTION 7. Offer, Sale and Resale Procedures. Each of the Initial Purchasers, on the one hand, and the Company and each of the Guarantors, on the other hand, hereby agree to observe the following procedures in connection with the offer and sale of the Securities:
(A) Offers and sales of the Securities will be made only by the Initial Purchasers or Affiliates thereof qualified to do so in the jurisdictions in which such offers or sales are made. Each such offer or sale shall only be made to persons whom the offeror or seller reasonably believes to be Qualified Institutional Buyers or non-U.S. persons outside the United States to whom the offeror or seller reasonably believes offers and sales of the Securities may be made in reliance upon Regulation S upon the terms and conditions set forth in Annex I hereto, which Annex I is hereby expressly made a part hereof.
(B) No general solicitation or general advertising (within the meaning of Rule 502 under the Securities Act) will be used in the United States in connection with the offering of the Securities.
(C) Upon original issuance by the Company, and until such time as the same is no longer required under the applicable requirements of the Securities Act, the Notes (and all securities issued in exchange therefor or in substitution thereof, other than the Exchange Notes) shall bear the following legend:
“THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE “SECURITIES ACT”) AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) (1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501 OF REGULATION D UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS.”
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Following the sale of the Securities by the Initial Purchasers to Subsequent Purchasers pursuant to the terms hereof, the Initial Purchasers shall not be liable or responsible to the Company for any losses, damages or liabilities suffered or incurred by the Company, including any losses, damages or liabilities under the Securities Act, arising from or relating to any resale or transfer of any Security.
SECTION 8. Indemnification .
(a) Indemnification of the Initial Purchasers. The Company and the Guarantors, jointly and severally, agree to indemnify and hold harmless each Initial Purchaser, its directors, officers and employees, and each person, if any, who controls any Initial Purchaser within the meaning of the Securities Act and the Exchange Act against any loss, claim, damage, liability or expense, as incurred, to which such Initial Purchaser, director, officer, employee or controlling person may become subject, under the Securities Act, the Exchange Act or other federal or state statutory law or regulation, or at common law or otherwise (including in settlement of any litigation, if such settlement is effected with the written consent of the Company or otherwise as permitted by Section 8(d)), insofar as such loss, claim, damage, liability or expense (or actions in respect thereof as contemplated below) arises out of or is based upon any untrue statement or alleged untrue statement of a material fact contained in the Pricing Circular or the Final Offering Circular (or any amendment or supplement thereto), or the omission therefrom of a material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, and to reimburse each Initial Purchaser and each such director, officer, employee or controlling person for any and all reasonable expenses (including the reasonable fees and disbursements of counsel chosen by Goldman, Sachs & Co.) as such expenses are reasonably incurred by such Initial Purchaser or such director, officer, employee or controlling person in connection with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense or action; provided, however, that the foregoing indemnity agreement shall not apply to any loss, claim, damage, liability or expense to the extent, but only to the extent, arising out of or based upon any untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity with written information furnished to the Company by the Initial Purchasers expressly for use in the Pricing Circular or the Final Offering Circular (or any amendment or supplement thereto). The indemnity agreement set forth in this Section 8(a) shall be in addition to any liabilities that the Company or the Guarantors may otherwise have.
(b) Indemnification of the Company, the Guarantors, its Directors and Officers. Each Initial Purchaser agrees, severally and not jointly, to indemnify and hold harmless the Company, each Guarantor, each of their respective directors, officers and each person, if any, who controls the Company or any Guarantor within the meaning of the Securities Act or the Exchange Act, against any loss, claim, damage, liability or expense, as incurred, to which the Company, any Guarantor or any such director, officer or controlling person may become subject, under the Securities Act, the Exchange Act, or other federal or state statutory law or regulation, or at common law or otherwise (including in settlement of any litigation, if such settlement is effected with the written consent of such Initial Purchaser or otherwise as permitted by Section 8(d)), insofar as such loss, claim, damage, liability or expense (or actions in respect thereof as contemplated below) arises out of or is based upon any untrue statement or alleged untrue statement of a material fact contained in the Pricing Circular, the Final Offering Circular or any
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Issuer Written Communication (or any amendment or supplement thereto), or the omission or alleged omission therefrom of 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 to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in the Pricing Circular or the Final Offering Circular (or any amendment or supplement thereto), in reliance upon and in conformity with written information furnished to the Company by the Initial Purchasers expressly for use therein; and to reimburse the Company, any Guarantor and each such director or controlling person for any and all expenses (including the fees and disbursements of counsel) as such expenses are reasonably incurred by the Company, any Guarantor or such director, officer or controlling person in connection with investigating, defending, settling, compromising or paying any such loss, claim, damage, liability, expense or action. Each of the Company and the Guarantors hereby acknowledges that the only information that the Initial Purchasers have furnished to the Company or any Guarantor expressly for use in the Pricing Circular or the Final Offering Circular (or any amendment or supplement thereto) are the statements set forth in the second sentence of the second paragraph, the second sentence of the seventh paragraph, the eighth paragraph, the ninth paragraph and the tenth paragraph under the caption “Plan of Distribution” in the Preliminary Offering Circular and the Final Offering Circular. The indemnity agreement set forth in this Section 8(b) shall be in addition to any liabilities that each Initial Purchaser may otherwise have.
(c) Notifications and Other Indemnification Procedures. Promptly after receipt by an indemnified party under Section 8 (a) or (b) of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against an indemnifying party under Section 8 (a) or (b), notify the indemnifying party in writing of the commencement thereof, but the omission so to notify the indemnifying party will not relieve it from any liability which it may have to any indemnified party for contribution or otherwise under the indemnity agreement contained in Section 8 (a) or (b) or to the extent it is not prejudiced as a proximate result of such failure. In case any such action is brought against any indemnified party and such indemnified party seeks or intends to seek indemnity from an indemnifying party, the indemnifying party will be entitled to participate in and, to the extent that it shall elect, jointly with all other indemnifying parties similarly notified, by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified party, to assume the defense thereof with counsel reasonably satisfactory to such indemnified party; provided, however, if the defendants in any such action include both the indemnified party and the indemnifying party and the indemnified party shall have reasonably concluded that a conflict may arise between the positions of the indemnifying party and the indemnified party in conducting the defense of any such action or that there may be legal defenses available to it and/or other indemnified parties which are different from or additional to those available to the indemnifying party, the indemnified party or parties shall have the right to select separate counsel to assume such legal defenses and to otherwise participate in the defense of such action on behalf of such indemnified party or parties. Upon receipt of notice from the indemnifying party to such indemnified party of such indemnifying party’s election so to assume the defense of such action and approval by the indemnified party of counsel, the indemnifying party will not be liable to such indemnified party under Section 8 (a) or (b) for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof unless (i) the indemnified party shall have employed separate counsel in accordance with the proviso to the next preceding sentence (it being understood, however, that the indemnifying party shall not be liable for the expenses of more than one
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separate counsel (together with local counsel), representing the indemnified parties who are parties to such action) or (ii) the indemnifying party shall not have employed counsel satisfactory to the indemnified party to represent the indemnified party within a reasonable time after notice of commencement of the action, in each of which cases the fees and expenses of counsel shall be at the expense of the indemnifying party.
(d) Settlements. The indemnifying party under this Section 8 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 party agrees to indemnify the indemnified party against any loss, claim, damage, liability or expense by reason of such settlement or judgment. Notwithstanding the foregoing sentence, if at any time an indemnified party shall have requested an indemnifying party to reimburse the indemnified party for fees and expenses of counsel as contemplated by this Section 8, the indemnifying party agrees that it shall be liable for any settlement of any proceeding effected without its written consent if (i) such settlement is entered into more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii) such indemnifying party shall not have reimbursed the indemnified party in accordance with such request prior to the date of such settlement. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement, compromise or consent to the entry of judgment in any pending or threatened action, suit or proceeding in respect of which any indemnified party is or could have been a party and indemnity was or could have been sought hereunder by such indemnified party, unless such settlement, compromise or consent (i) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such action, suit or proceeding and (ii) does not include any statements as to or any findings of fault, culpability or failure to act by or on behalf of any indemnified party.
SECTION 9. Contribution. If the indemnification provided for in Section 8 hereof is for any reason held to be unavailable to or otherwise insufficient to hold harmless an indemnified party in respect of any losses, claims, damages, liabilities or expenses referred to therein, then each indemnifying party shall contribute to the aggregate amount paid or payable by such indemnified party, as incurred, as a result of any losses, claims, damages, liabilities or expenses referred to therein (i) in such proportion as is appropriate to reflect the relative benefits received by the Company and the Guarantors, on the one hand, and the Initial Purchasers, on the other hand, from the offering of the Securities pursuant to this Agreement or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Company and the Guarantors, on the one hand, and the Initial Purchasers, on the other hand, in connection with the statements or omissions or inaccuracies in the representations and warranties herein which resulted in such losses, claims, damages, liabilities or expenses, as well as any other relevant equitable considerations. The relative benefits received by the Company and the Guarantors, on the one hand, and the Initial Purchasers, on the other hand, in connection with the offering of the Securities pursuant to this Agreement shall be deemed to be in the same respective proportions as the total net proceeds from the offering of the Securities pursuant to this Agreement (before deducting expenses) received by the Company, and the total discount received by the Initial Purchasers bear to the aggregate initial offering price of the Securities. The relative fault of the Company and the Guarantors, on the one hand, and the Initial Purchasers, on the other hand, shall be determined by reference to, among other things, whether any such untrue
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or alleged untrue statement of a material fact or omission or alleged omission to state a material fact or any such inaccurate or alleged inaccurate representation or warranty relates to information supplied by the Company and the Guarantors, on the one hand, or the Initial Purchasers, on the other hand, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission or inaccuracy.
The amount paid or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred to above shall be deemed to include, subject to the limitations set forth in Section 8 hereof, any legal or other fees or expenses reasonably incurred by such party in connection with investigating or defending any action or claim. The provisions set forth in Section 8 hereof with respect to notice of commencement of any action shall apply if a claim for contribution is to be made under this Section 9; provided, however, that no additional notice shall be required with respect to any action for which notice has been given under Section 8 hereof for purposes of indemnification.
The Company, the Guarantors and the Initial Purchasers agree that it would not be just and equitable if contribution pursuant to this Section 9 were determined by pro rata allocation (even if the Initial Purchasers were treated as one entity for such purpose) or by any other method of allocation which does not take account of the equitable considerations referred to in this Section 9.
Notwithstanding the provisions of this Section 9, no Initial Purchaser shall be required to contribute any amount in excess of the discount received by such Initial Purchaser in connection with the Securities distributed by it. No person guilty of fraudulent misrepresentation (within the meaning of Section 11 of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. The Initial Purchasers’ obligations to contribute pursuant to this Section 9 are several, and not joint, in proportion to their respective commitments as set forth opposite their names in Schedule A. For purposes of this Section 9, each director, officer and employee of an Initial Purchaser and each person, if any, who controls an Initial Purchaser within the meaning of the Securities Act and the Exchange Act shall have the same rights to contribution as such Initial Purchaser, and each director or officer of the Company or any Guarantor, and each person, if any, who controls the Company or any Guarantor with the meaning of the Securities Act and the Exchange Act shall have the same rights to contribution as the Company and the Guarantors.
SECTION 10. Termination of this Agreement. Prior to the Closing Date, this Agreement may be terminated by the Initial Purchasers by notice given to the Company if at any time: (i) trading or quotation in any of the Company’s securities shall have been suspended or limited by the Commission or trading in securities generally on either the Nasdaq Stock Market or the New York Stock Exchange shall have been suspended or limited; (ii) a general banking moratorium shall have been declared by any of federal, New York or Delaware authorities; (iii) there shall have occurred any outbreak or escalation of national or international hostilities or any crisis or calamity, or any change in the United States or international financial markets, or any substantial change or development involving a prospective substantial change in United States’ or international political, financial or economic conditions, as in the judgment of the Initial Purchasers is material and adverse and makes it impracticable to proceed with the offering sale or delivery of the Securities in the manner and on the terms described in the Pricing Circular or to enforce
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contracts for the sale of securities; or (iv) in the judgment of the Initial Purchasers there shall have occurred any Material Adverse Change. Any termination pursuant to this Section 10 shall be without liability on the part of (i) the Company or any Guarantor to any Initial Purchaser, except that the Company and the Guarantors shall be obligated to reimburse the expenses of the Initial Purchasers pursuant to Sections 4 and 6 hereof, (ii) any Initial Purchaser to the Company, or (iii) any party hereto to any other party except that the provisions of Sections 8 and 9 hereof shall at all times be effective and shall survive such termination.
SECTION 11. Representations and Indemnities to Survive Delivery. The respective indemnities, agreements, representations, warranties and other statements of the Company, the Guarantors, their respective officers and the several Initial Purchasers set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation made by or on behalf of any Initial Purchaser, the Company, any Guarantor or any of their partners, officers or directors or any controlling person, as the case may be, and will survive delivery of and payment for the Securities sold hereunder and any termination of this Agreement.
SECTION 12. Notices. All communications hereunder shall be in writing and shall be mailed, hand delivered, couriered or facsimiled and confirmed to the parties hereto as follows:
If to the Initial Purchasers:
Goldman, Sachs & Co.
200 West Street
New York, New York 10282
Telephone: (866) 471-2526
Attention: Registration Department
with a copy to:
Cahill Gordon & Reindel LLP
80 Pine Street
New York, New York 10005
Facsimile: (212) 269-5420
Attention: Daniel J. Zubkoff
Corey Wright
If to the Company or the Guarantors:
Burlington Coat Factory Warehouse Corporation
1830 Route 130 North
Burlington, New Jersey 08016
Facsimile: (609) 239-9675
Attention: General Counsel
with a copy to:
Kirkland & Ellis LLP
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601 Lexington Avenue
New York, New York 10022-4611
Facsimile: (212) 446-4900
Attention: Joshua N. Korff
Any party hereto may change the address or facsimile number for receipt of communications by giving written notice to the others.
SECTION 13. Successors. This Agreement will inure to the benefit of and be binding upon the parties hereto, including any substitute Initial Purchasers pursuant to Section 16 hereof, and to the benefit of the indemnified parties referred to in Sections 8 and 9 hereof, and in each case their respective successors, and no other person will have any right or obligation hereunder. The term “successors” shall not include any Subsequent Purchaser or other purchaser of the Securities as such from any of the Initial Purchasers merely by reason of such purchase.
SECTION 14. Partial Unenforceability. The invalidity or unenforceability of any section, paragraph or provision of this Agreement shall not affect the validity or enforceability of any other section, paragraph or provision hereof. If any section, paragraph or provision of this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed to be made such minor changes (and only such minor changes) as are necessary to make it valid and enforceable.
SECTION 15. Governing Law Provisions. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.
(a) Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based upon this Agreement or the transactions contemplated hereby (“Related Proceedings”) may be instituted in the federal courts of the United States of America located in the City and County of New York or the courts of the State of New York in each case located in the City and County of New York (collectively, the “Specified Courts”), and each party irrevocably submits to the exclusive jurisdiction (except for suits, actions, or proceedings instituted in regard to the enforcement of a judgment of any Specified Court in a Related Proceeding, as to which such jurisdiction is non-exclusive) of the Specified Courts in any Related Proceeding. Service of any process, summons, notice or document by mail to such party’s address set forth above shall be effective service of process for any Related Proceeding brought in any Specified Court. The parties irrevocably and unconditionally waive any objection to the laying of venue of any Specified Proceeding in the Specified Courts and irrevocably and unconditionally waive and agree not to plead or claim in any Specified Court that any Related Proceeding brought in any Specified Court has been brought in an inconvenient forum.
(b) Waiver of Jury Trial. The Company, the Guarantors and each of the Initial Purchasers 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 Agreement or the transactions contemplated hereby.
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SECTION 16. Default of One or More of the Several Initial Purchasers. If any one or more of the several Initial Purchasers shall fail or refuse to purchase Securities that it or they have agreed to purchase hereunder on the Closing Date, and the aggregate number of Securities which such defaulting Initial Purchaser or Initial Purchasers agreed but failed or refused to purchase does not exceed 10% of the aggregate number of the Securities to be purchased on such date, the other Initial Purchasers shall be obligated, severally, in the proportions that the number of Securities set forth opposite their respective names on Schedule A bears to the aggregate number of Securities set forth opposite the names of all such non-defaulting Initial Purchasers, or in such other proportions as may be specified by the Initial Purchasers with the consent of the non-defaulting Initial Purchasers, to purchase the Securities which such defaulting Initial Purchaser or Initial Purchasers agreed but failed or refused to purchase on the Closing Date. If any one or more of the Initial Purchasers shall fail or refuse to purchase Securities and the aggregate number of Securities with respect to which such default occurs exceeds 10% of the aggregate number of Securities to be purchased on the Closing Date, and arrangements satisfactory to the Initial Purchasers and the Company for the purchase of such Securities are not made within 48 hours after such default, this Agreement shall terminate without liability of any party to any other party except that the provisions of Sections 4, 6, 8 and 9 hereof shall at all times be effective and shall survive such termination. In any such case either the Initial Purchasers or the Company shall have the right to postpone the Closing Date, as the case may be, but in no event for longer than seven days in order that the required changes, if any, to the Final Offering Circular or any other documents or arrangements may be effected.
As used in this Agreement, the term “Initial Purchaser” shall be deemed to include any person substituted for a defaulting Initial Purchaser under this Section 16. Any action taken under this Section 16 shall not relieve any defaulting Initial Purchaser from liability in respect of any default of such Initial Purchaser under this Agreement.
SECTION 17. No Advisory or Fiduciary Responsibility. Each of the Company and the Guarantors acknowledges and agrees that: (i) the purchase and sale of the Securities pursuant to this Agreement, including the determination of the offering price of the Securities and any related discounts and commissions, is an arm’s-length commercial transaction between the Company and the Guarantors, on the one hand, and the several Initial Purchasers, on the other hand, and the Company and the Guarantors are capable of evaluating and understanding and understand and accept the terms, risks and conditions of the transactions contemplated by this Agreement; (ii) in connection with each transaction contemplated hereby and the process leading to such transaction each Initial Purchaser is and has been acting solely as a principal and is not the agent or fiduciary of the Company, any Guarantor or any of their respective affiliates, stockholders, creditors or employees or any other party; (iii) no Initial Purchaser has assumed or will assume an advisory or fiduciary responsibility in favor of the Company or any Guarantor with respect to any of the transactions contemplated hereby or the process leading thereto (irrespective of whether such Initial Purchaser has advised or is currently advising the Company or any Guarantor on other matters) or any other obligation to the Company or any Guarantor except the obligations expressly set forth in this Agreement; (iv) the several Initial Purchasers and their respective affiliates may be engaged in a broad range of transactions that involve interests that differ from those of the Company and the Guarantors and that the several Initial Purchasers have no obligation to disclose any of such interests by virtue of any fiduciary or advisory relationship; and (v) the Initial Purchasers have not provided any legal, accounting, regulatory or tax advice
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with respect to the offering contemplated hereby and the Company and the Guarantors have consulted their own legal, accounting, regulatory and tax advisors to the extent they deemed appropriate.
This Agreement supersedes all prior agreements and understandings (whether written or oral) between the Company, the Guarantors and the several Initial Purchasers, or any of them, with respect to the subject matter hereof. The Company and each of the Guarantors hereby waive and release, to the fullest extent permitted by law, any claims that the Company or any Guarantor may have against the several Initial Purchasers with respect to any breach or alleged breach of fiduciary duty.
SECTION 18. Patriot Act. In accordance with the requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001)), the Initial Purchasers are required to obtain, verify and record information that identifies their respective clients, including the Company, which information may include the name and address of their respective clients, as well as other information that will allow the Initial Purchasers to properly identify their respective clients.
SECTION 19. General Provisions. This Agreement constitutes the entire agreement of the parties to this Agreement and supersedes all prior written or oral and all contemporaneous oral agreements, understandings and negotiations with respect to the subject matter hereof. This Agreement may be executed in two or more counterparts, each one of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. This Agreement may not be amended or modified unless in writing by all of the parties hereto, and no condition herein (express or implied) may be waived unless waived in writing by each party whom the condition is meant to benefit. The section headings herein are for the convenience of the parties only and shall not affect the construction or interpretation of this Agreement.
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If the foregoing is in accordance with your understanding of our agreement, kindly sign and return to the Company the enclosed copies hereof, whereupon this instrument, along with all counterparts hereof, shall become a binding agreement in accordance with its terms.
| Very truly yours, | ||
| BURLINGTON COAT FACTORY WAREHOUSE CORPORATION | ||
| By: | /s/ Robert LaPenta, Jr. | |
| Name: Robert LaPenta, Jr. | ||
| Title: Vice President and Treasurer | ||
| The GUARANTORS listed on Schedule B hereto | ||
| By: | /s/ Robert LaPenta, Jr. | |
| Name: Robert LaPenta, Jr. | ||
| Title: Vice President and Treasurer | ||
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The foregoing Purchase Agreement is hereby confirmed and accepted by the Initial Purchasers as of the date first above written.
| GOLDMAN, SACHS & CO. | ||
| By: | /s/ Goldman, Sachs & Co. | |
| Goldman, Sachs & Co. | ||
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| J.P. MORGAN SECURITIES LLC | ||
| By: | /s/ Peter B. Hooker | |
| Name: Peter B. Hooker | ||
| Title: Managing Director | ||
| MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED | ||
| By: | /s/ Michelle Koren | |
| Name: Michelle Koren | ||
| Title: Vice President | ||
| WELLS FARGO SECURITIES, LLC | ||
| By: | /s/ Chris McCoy | |
| Name: Chris McCoy | ||
| Title: Director | ||
SCHEDULE A
|
Initial Purchasers |
Aggregate
Principal Amount of Securities to be Purchased |
|||
|
J.P. Morgan Securities LLC. |
$ | 153,000,000 | ||
|
Goldman, Sachs & Co. |
99,000,000 | |||
|
Merrill Lynch, Pierce, Fenner & Smith Incorporated |
99,000,000 | |||
|
Wells Fargo Securities, LLC |
99,000,000 | |||
|
Total |
$ | 450,000,000 | ||
SCHEDULE B
|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory of Alabama, LLC |
Alabama | |
|
Burlington Coat Factory Realty of Huntsville, LLC |
Alabama | |
|
Burlington Coat Factory Warehouse of Anchorage, Inc. |
Alaska | |
|
Burlington Coat Factory Realty of Mesa, Inc. |
Arizona | |
|
Burlington Coat Factory Realty of Desert Sky, Inc. |
Arizona | |
|
Burlington Coat Factory of Arizona, LLC |
Arizona | |
|
Burlington Coat Factory of Arkansas, LLC |
Arkansas | |
|
Burlington Coat Factory Realty of Dublin, Inc. |
California | |
|
Burlington Coat Factory Realty of Florin, Inc. |
California | |
|
Burlington Coat Factory Realty of Ventura, Inc. |
California | |
|
Baby Depot of California, LLC |
California | |
|
Burlington Coat Factory of California, LLC |
California | |
|
Burlington Coat Factory of San Bernardino, LLC |
California | |
|
MJM Designer Shoes of California, LLC |
California | |
|
Burlington Coat Factory of Colorado, LLC |
Colorado | |
|
Burlington Coat Realty of East Windsor, Inc. |
Connecticut | |
|
Burlington Coat Factory of Connecticut, LLC |
Connecticut | |
|
Cohoes Fashions of Connecticut, LLC |
Connecticut | |
|
Burlington Coat Factory of Texas, Inc. |
Delaware | |
|
C.F.I.C. Corporation |
Delaware | |
|
Burlington Coat Factory Realty Corp. |
Delaware | |
|
Burlington Coat Factory of Delaware, LLC |
Delaware | |
|
MJM Designer Shoes of Delaware, LLC |
Delaware | |
|
Burlington Coat Factory Investments Holdings, Inc. |
Delaware | |
|
Burlington Coat Factory of Texas, L.P. |
Delaware | |
|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory Realty of University Square, Inc. |
Florida | |
|
Burlington Coat Factory Realty of Coral Springs, Inc. |
Florida | |
|
Burlington Coat Factory Realty of West Colonial, Inc. |
Florida | |
|
Burlington Coat Factory Realty of Orlando, Inc. |
Florida | |
|
Burlington Coat Factory Realty of Sarasota, Inc. |
Florida | |
|
K&T Acquisition Corp. |
Florida | |
|
Burlington Coat Factory of Florida, LLC |
Florida | |
|
MJM Designer Shoes of Florida, LLC |
Florida | |
|
Bee Ridge Plaza, LLC |
Florida | |
|
Burlington Coat Factory Warehouse of Atlanta, Inc. |
Georgia | |
|
Burlington Coat Factory Realty of Morrow, Inc. |
Georgia | |
|
Burlington Coat Factory of Georgia, LLC |
Georgia | |
|
Burlington Coat Factory of Hawaii, LLC |
Hawaii | |
|
Burlington Coat Factory of Idaho, LLC |
Idaho | |
|
Burlington Coat Factory Warehouse of East St. Louis, Inc. |
Illinois | |
|
Burlington Coat Realty of Gurnee, Inc. |
Illinois | |
|
Burlington Coat Factory Realty of Bloomingdale, Inc. |
Illinois | |
|
Burlington Coat Factory Realty of River Oaks, Inc. |
Illinois | |
|
Burlington Coat Factory of Illinois, LLC |
Illinois | |
|
Burlington Coat Factory Realty of Greenwood, Inc. |
Indiana | |
|
Burlington Coat Factory of Indiana, LLC |
Indiana | |
|
Burlington Coat Factory of Iowa, LLC |
Iowa | |
|
Burlington Coat Factory of Kansas, LLC |
Kansas | |
|
Burlington Coat Factory of Kentucky, Inc. |
Kentucky | |
|
Burlington Coat Factory of Louisiana, LLC |
Louisiana | |
|
Burlington Coat Factory of Maine, LLC |
Maine | |
|
Burlington Coat Factory of Maryland, LLC |
Maryland | |
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|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory Realty of North Attleboro, Inc. |
Massachusetts | |
|
Burlington Coat Factory of Massachusetts, LLC |
Massachusetts | |
|
Cohoes Fashions of Massachusetts, LLC |
Massachusetts | |
|
Burlington Coat Factory Warehouse of Detroit, Inc. |
Michigan | |
|
Burlington Coat Factory Warehouse of Grand Rapids, Inc. |
Michigan | |
|
Burlington Coat Factory Warehouse of Redford, Inc. |
Michigan | |
|
Burlington Coat Factory of Michigan, LLC |
Michigan | |
|
Burlington Coat Factory of Minnesota, LLC |
Minnesota | |
|
Burlington Coat Factory of Mississippi, LLC |
Mississippi | |
|
Burlington Coat Factory Realty of Des Peres, Inc. |
Missouri | |
|
Burlington Coat Factory of Missouri, LLC |
Missouri | |
|
Burlington Coat Factory of Montana, LLC |
Montana | |
|
Burlington Coat Factory of Nebraska, LLC |
Nebraska | |
|
Burlington Coat Realty of Las Vegas, Inc. |
Nevada | |
|
Burlington Coat Factory of Nevada, LLC |
Nevada | |
|
Burlington Coat Factory of New Hampshire, LLC |
New Hampshire | |
|
Burlington Coat Factory Direct Corporation |
New Jersey | |
|
Burlington Coat Factory Warehouse of Edgewater Park, Inc. |
New Jersey | |
|
Burlington Coat Factory Warehouse of New Jersey, Inc. |
New Jersey | |
|
MJM Designer Shoes of Moorestown, Inc. |
New Jersey | |
|
Super Baby Depot of Moorestown, Inc. |
New Jersey | |
|
Burlington Coat Factory Realty of Edgewater Park, Inc. |
New Jersey | |
|
Burlington Coat Factory Realty of Paramus, Inc. |
New Jersey | |
|
Burlington Coat Factory Realty of Pinebrook, Inc. |
New Jersey | |
|
Burlington Coat Factory Warehouse of Edgewater Park Urban Renewal Corp. |
New Jersey | |
|
Burlington Coat Factory of New Jersey, LLC |
New Jersey | |
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|
Guarantors |
Jurisdiction of Organization |
|
|
Cohoes Fashions of New Jersey, LLC |
New Jersey | |
|
MJM Designer Shoes of New Jersey, LLC |
New Jersey | |
|
Burlington Coat Factory of New Mexico, LLC |
New Mexico | |
|
LC Acquisition Corp. |
New York | |
|
Georgetown Fashions Inc. |
New York | |
|
Monroe G. Milstein, Inc. |
New York | |
|
Burlington Coat Factory Realty of Yonkers, Inc. |
New York | |
|
Burlington Coat Factory of New York, LLC |
New York | |
|
Cohoes Fashions of New York, LLC |
New York | |
|
MJM Designer Shoes of New York, LLC |
New York | |
|
Burlington Coat Factory of North Carolina, LLC |
North Carolina | |
|
Burlington Coat Factory of North Dakota, LLC |
North Dakota | |
|
Burlington Coat Factory Warehouse of Cleveland, Inc. |
Ohio | |
|
Burlington Coat Factory of Ohio, LLC |
Ohio | |
|
Burlington Coat Factory Realty of Tulsa, Inc. |
Oklahoma | |
|
Burlington Coat Factory of Oklahoma, LLC |
Oklahoma | |
|
Burlington Coat Factory of Oregon, LLC |
Oregon | |
|
Burlington Coat Factory Warehouse Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Cheltenham, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Langhorne, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Montgomeryville, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Realty of West Mifflin, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Realty of Langhorne, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Realty of Whitehall, Inc. |
Pennsylvania | |
|
Burlington Factory Warehouse of Reading, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Bristol, LLC |
Pennsylvania | |
|
Burlington Coat Factory of Pennsylvania, LLC |
Pennsylvania | |
-4-
|
Guarantors |
Jurisdiction of Organization |
|
|
MJM Designer Shoes of Pennsylvania, LLC |
Pennsylvania | |
|
Burlington Coat Factory of Puerto Rico, LLC |
Puerto Rico | |
|
Cohoes Fashions of Cranston, Inc. |
Rhode Island | |
|
Burlington Coat Factory of Rhode Island, LLC |
Rhode Island | |
|
Burlington Coat Factory Warehouse of Charleston, Inc. |
South Carolina | |
|
Burlington Coat Factory of South Carolina, LLC |
South Carolina | |
|
Burlington Coat Factory of South Dakota, LLC |
South Dakota | |
|
Burlington Coat Factory Warehouse of Hickory Commons, Inc. |
Tennessee | |
|
Burlington Coat Factory Warehouse of Memphis, Inc. |
Tennessee | |
|
Burlington Coat Factory Warehouse of Shelby, Inc. |
Tennessee | |
|
Burlington Coat Factory Realty of Memphis, Inc. |
Tennessee | |
|
Burlington Coat Realty of Plano, Inc. |
Texas | |
|
Burlington Coat Factory Warehouse of Baytown, Inc. |
Texas | |
|
M J M Designer Shoes of Texas, Inc. |
Texas | |
|
Burlington Coat Realty of Houston, Inc. |
Texas | |
|
Burlington Coat Factory Realty of Westmoreland, Inc. |
Texas | |
|
Burlington Coat Factory Realty of Bellaire, Inc. |
Texas | |
|
Burlington Coat Factory Realty of El Paso, Inc. |
Texas | |
|
Burlington Coat Factory of Utah, LLC |
Utah | |
|
Burlington Coat Factory of Vermont, LLC |
Vermont | |
|
BCF Cards, Inc. |
Virginia | |
|
Burlington Coat Factory Warehouse of Coliseum, Inc. |
Virginia | |
|
Burlington Coat Realty of Potomac, Inc. |
Virginia | |
|
Burlington Coat Factory Realty of Fairfax, Inc. |
Virginia | |
|
Burlington Coat Factory Realty of Coliseum, Inc. |
Virginia | |
|
Burlington Coat Factory of Virginia, LLC |
Virginia | |
|
Burlington Coat Factory of Pocono Crossing, LLC |
Virginia | |
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|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory Realty of Franklin, Inc. |
Washington | |
|
Burlington Coat Factory of Washington, LLC |
Washington | |
|
Burlington Coat Factory of West Virginia, LLC |
West Virginia | |
|
Burlington Coat Factory of Wisconsin, LLC |
Wisconsin | |
-6-
ANNEX I
Resale Pursuant to Regulation S or Rule 144A . Each Initial Purchaser understands that:
Such Initial Purchaser agrees that it has not offered or sold and will not offer or sell the Securities in the United States or to, or for the benefit or account of, a U.S. Person (other than a distributor), in each case, as defined in Rule 902 of Regulation S (i) as part of its distribution at any time and (ii) otherwise until 40 days after the later of the commencement of the offering of the Securities pursuant hereto and the Closing Date, other than in accordance with Regulation S or another exemption from the registration requirements of the Securities Act. Such Initial Purchaser agrees that, during such 40-day restricted period, it will not cause any advertisement with respect to the Securities (including any “tombstone” advertisement) to be published in any newspaper or periodical or posted in any public place and will not issue any circular relating to the Securities, except such advertisements as are permitted by and include the statements required by Regulation S.
Such Initial Purchaser agrees that, at or prior to confirmation of a sale of Securities by it to any distributor, dealer or person receiving a selling concession, fee or other remuneration during the 40-day restricted period referred to in Rule 903 of Regulation S, it will send to such distributor, dealer or person receiving a selling concession, fee or other remuneration a confirmation or notice to substantially the following effect:
“The Securities covered hereby have not been registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and may not be offered and sold within the United States or to, or for the account or benefit of, U.S. persons (i) as part of your distribution at any time or (ii) otherwise until 40 days after the later of the date the Securities were first offered to persons other than distributors in reliance upon Regulation S and the Closing Date, except in either case in accordance with Regulation S under the Securities Act (or in accordance with Rule 144A under the Securities Act or to accredited investors in transactions that are exempt from the registration requirements of the Securities Act), and in connection with any subsequent sale by you of the Securities covered hereby in reliance on Regulation S under the Securities Act during the period referred to above to any distributor, dealer or person receiving a selling concession, fee or other remuneration, you must deliver a notice to substantially the foregoing effect. Terms used above have the meanings assigned to them in Regulation S under the Securities Act.”
Annex I-1
Exhibit 4.1
SECOND SUPPLEMENTAL INDENTURE
THIS SECOND SUPPLEMENTAL INDENTURE (this “ Supplemental Indenture ”), dated as of February 24, 2011, is made by and among Burlington Coat Factory Warehouse Corporation, a Delaware corporation (the “ Company ”), the guarantors signatory hereto (the “ Guarantors ”) and Wilmington Trust FSB (as successor trustee to Wells Fargo Bank, N.A.), as Trustee (the “ Trustee ”).
RECITALS:
WHEREAS, the Company, the Guarantors and the Trustee are parties to an Indenture dated as of April 13, 2006 (as amended, supplemented or otherwise modified from time to time, the “ Indenture ”).
WHEREAS, pursuant to the Indenture, the Company issued and the Trustee authenticated and delivered an aggregate principal amount of $305,000,000 of the Company’s 11 1 / 8 % Senior Notes due 2014 (the “ Notes ”), of which $305,000,000 is currently outstanding.
WHEREAS, Section 9.2 of the Indenture provides, among other things, that with the consent of the holders (the “ Holders ”) of at least a majority in aggregate principal amount of the Notes then outstanding (the “ Requisite Consents ”), the Company, the Guarantors and the Trustee may amend the Indenture or the Notes.
WHEREAS, on February 9, 2011, the Company distributed an Offer to Purchase and Consent Solicitation Statement (as amended, modified, or supplemented, the “ Offer to Purchase ”) to each Holder.
WHEREAS, the Company has obtained the Requisite Consents to amend the Indenture as set forth in the Offer to Purchase (the “ Amendments ”).
WHEREAS, this Supplemental Indenture has been duly authorized by all necessary corporate action on the part of the Company.
WHEREAS, the Company has delivered, or caused to be delivered, to the Trustee an Officer’s Certificate and an Opinion of Counsel meeting the requirements of Sections 12.4 and 12.5 of the Indenture.
NOW THEREFORE , each party agrees for the benefit of the other parties and for the equal and ratable benefit of all Holders, as follows:
AGREEMENT:
Section 1. Definitions . Capitalized terms used in this Supplemental Indenture and not otherwise defined herein have the meanings given to them in the Indenture. Sections 1.1 and 1.2 of the Indenture are hereby amended to delete in their entirety all terms and their respective definitions for which all references are eliminated in the Indenture as a result of the amendments set forth in Section 2.1 below.
Section 2. Amendments.
2.1 Amendment of Certain Sections of the Indenture . The Indenture is hereby amended by deleting the following sections of the Indenture and all references thereto in the Indenture in their entirety:
(a) Section 4.3 - Provision of Financial Information
(b) Section 4.4 - Compliance Certificate
(c) Section 4.5 - Taxes
(d) Section 4.6 - Stay, Extension and Usury Laws
(e) Section 4.7 - Limitation on Restricted Payments
(f) Section 4.8 - Limitation on Dividends and Other Payment Restrictions Affecting Subsidiaries
(g) Section 4.9 - Limitation on Incurrence of Debt
(h) Section 4.10 - Limitation on Merger, Consolidation or Sale of Assets
(i) Section 4.11 - Limitation on Transactions with Affiliates
(j) Section 4.12 - Limitation on Liens
(k) Section 4.13 - Payments for Consent
(l) Section 4.14 - Offer to Purchase upon Change of Control
(m) Section 4.15 - Corporate Existence
(n) Section 4.16 - Business Activities
(o) Section 4.17 - Additional Guarantees
(p) Section 4.18 - Limitation on Creation of Unrestricted Subsidiaries
(q) Section 4.19 - Further Instruments and Acts
(r) Section 5.1 - Consolidation, Merger, Conveyance, Transfer or Lease
(s) Section 5.2 - Successor Corporation Substituted
2
2.2 Amendments to Events of Defaults in the Indenture . Section 6.1 of the Indenture, “Events of Default” is hereby amended and restated in its entirety as follows:
SECTION 6.1 Events of Default .
Each of the following consitutes an “ Event of Default ”:
(1) the Company defaults in payment when due and payable, upon redemption, acceleration or otherwise, of principal of, or premium, if any, on the Notes; and
(2) the Company defaults in the payment when due of interest or Additional Interest, if any, on or with respect to the Notes and such default continues for a period of 30 days.
(3) Reserved.
(4) Reserved.
(5) Reserved.
(6) Reserved.
(7) Reserved.
Section 3. Miscellaneous.
3.1 Effect of Supplemental Indenture . Upon the execution and delivery of this Supplemental Indenture by the Company, the Guarantors and the Trustee, the Indenture shall be supplemented in accordance herewith, and this Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder holding Notes that have been heretofore or hereafter authenticated and delivered under the Indenture shall be bound thereby; provided , however, that Sections 1 and 2.1 hereof shall not become operative unless and until the date (the “ Operative Date ”) set forth in a notice from the Company to the Trustee, stating that all the Notes that were validly tendered and not withdrawn at or prior to the Early Acceptance Date (as defined in the Offer to Purchase) were purchased on the Early Payment Date (as defined in the Offer to Purchase).
3.2 Indenture Remains in Full Force and Effect . Except as supplemented hereby, all provisions of the Indenture shall remain in full force and effect.
3.3 Indenture and Supplemental Indenture Construed Together . This Supplemental Indenture is an indenture supplemental to and in implementation of the Indenture, and the Indenture and this Supplemental Indenture shall henceforth be read and construed together.
3.4 Confirmation and Preservation of the Indenture . The Indenture as supplemented by this Supplemental Indenture is in all respects confirmed and preserved.
3.5 Conflict with Trust Indenture Act . If any provision of this Supplemental Indenture limits, qualifies, or conflicts with any provision of the Trust Indenture Act of 1939, as amended (the “ Act ”), that is required under such Act to be part of and govern any provision of this Supplemental Indenture, the provision of such Act shall control. If any provision of this Supplemental Indenture modifies or excludes any provision of the Act that
3
may be so modified or excluded, the provisions of the Act shall be deemed to apply to the Indenture as so modified or to be excluded by this Supplemental Indenture, as the case may be.
3.6 Trustee Not Responsible for Recitals . The recitals contained herein shall be taken as the statements of the Company and the Trustee assumes no responsibility for their correctness. The Trustee makes no representation as to the validity or adequacy of this Supplemental Indenture.
3.7 Certain Duties and Responsibilities of the Trustee . In entering into this Supplemental Indenture, the Trustee shall be entitled to the benefit of every provision of the Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee, whether or not elsewhere herein so provided, including specifically the Trustee’s rights to indemnification contained in Section 7.2 of the Indenture.
3.8 Separability Clause . In case any provision of this Supplemental Indenture shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
3.9 Effect of Headings . The Section and Subsection headings herein are for convenience only and shall not affect the construction hereof.
3.10 Benefits of Supplemental Indenture . Nothing in this Supplemental Indenture, the Indenture, or the Notes, express or implied, shall give to any Person, other than the parties hereto and thereto and their successors hereunder and thereunder, and the Holders, any benefit of any legal or equitable right, remedy, or claim under the Indenture, this Supplemental Indenture, or the Notes.
3.11 Successors and Assigns . All covenants and agreements in this Supplemental Indenture by the Company shall bind its successors and permitted assigns, whether so expressed or not.
3.12 Governing Law . THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
3.13 Counterparts . This Supplemental Indenture may be executed in counterparts (including by means of facsimile signature pages), each of which shall be an original, but all such counterparts shall together constitute one and the same instrument.
[Remainder of Page Blank — Signature Pages Follow]
4
IN WITNESS WHEREOF , the parties hereto have caused this Supplemental Indenture to be duly executed as of the date and the year first written above.
|
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION |
||
| By: | /s/ Robert LaPenta, Jr. | |
| Name: Robert LaPenta, Jr. | ||
| Title: Vice President and Treasurer | ||
| The GUARANTORS listed on Schedule A hereto | ||
| By: | /s/ Robert LaPenta, Jr. | |
| Name: Robert LaPenta, Jr. | ||
| Title: Vice President and Treasurer | ||
| Wilmington Trust FSB, as Trustee | ||
| By | /s/ Jane Schweiger | |
| Name: Jane Schweiger | ||
| Title: Vice President | ||
Schedule A
Burlington Coat Factory of Alabama, LLC
Burlington Coat Factory Realty of Huntsville, LLC
Burlington Coat Factory Warehouse of Anchorage, Inc.
Burlington Coat Factory Realty of Mesa, Inc.
Burlington Coat Factory Realty of Desert Sky, Inc.
Burlington Coat Factory of Arizona, LLC
Burlington Coat Factory of Arkansas, LLC
Burlington Coat Factory Realty of Dublin, Inc.
Burlington Coat Factory Realty of Florin, Inc.
Burlington Coat Factory Realty of Ventura, Inc.
Baby Depot of California, LLC
Burlington Coat Factory of California, LLC
Burlington Coat Factory of San Bernardino, LLC
MJM Designer Shoes of California, LLC
Burlington Coat Factory of Colorado, LLC
Burlington Coat Realty of East Windsor, Inc.
Burlington Coat Factory of Connecticut, LLC
Cohoes Fashions of Connecticut, LLC
Burlington Coat Factory of Texas, Inc.
C.F.I.C. Corporation
Burlington Coat Factory Realty Corp.
Burlington Coat Factory of Delaware, LLC
MJM Designer Shoes of Delaware, LLC
Burlington Coat Factory of Texas, L.P.
Burlington Coat Factory Realty of University Square, Inc.
Burlington Coat Factory Realty of Coral Springs, Inc.
Burlington Coat Factory Realty of West Colonial, Inc.
Burlington Coat Factory Realty of Orlando, Inc.
Burlington Coat Factory Realty of Sarasota, Inc.
K&T Acquisition Corp.
Burlington Coat Factory of Florida, LLC
MJM Designer Shoes of Florida, LLC
Bee Ridge Plaza, LLC
Burlington Coat Factory Warehouse of Atlanta, Inc.
Burlington Coat Factory Realty of Morrow, Inc.
Burlington Coat Factory of Georgia, LLC
Burlington Coat Factory of Hawaii, LLC
Burlington Coat Factory of Idaho, LLC
Burlington Coat Factory Warehouse of East St. Louis, Inc.
Burlington Coat Realty of Gurnee, Inc.
Burlington Coat Factory Realty of Bloomingdale, Inc.
Burlington Coat Factory Realty of River Oaks, Inc.
Burlington Coat Factory of Illinois, LLC
Burlington Coat Factory Realty of Greenwood, Inc.
Burlington Coat Factory of Indiana, LLC
Burlington Coat Factory of Iowa, LLC
Burlington Coat Factory of Kansas, LLC
Burlington Coat Factory of Kentucky, Inc.
Burlington Coat Factory of Louisiana, LLC
Burlington Coat Factory of Maine, LLC
Burlington Coat Factory of Maryland, LLC
Burlington Coat Factory Realty of North Attleboro, Inc.
Burlington Coat Factory of Massachusetts, LLC
Cohoes Fashions of Massachusetts, LLC
Burlington Coat Factory Warehouse of Detroit, Inc.
Burlington Coat Factory Warehouse of Grand Rapids, Inc.
Burlington Coat Factory Warehouse of Redford, Inc.
Burlington Coat Factory of Michigan, LLC
Burlington Coat Factory of Minnesota, LLC
Burlington Coat Factory of Mississippi, LLC
Burlington Coat Factory Realty of Des Peres, Inc.
Burlington Coat Factory of Missouri, LLC
Burlington Coat Factory of Montana, LLC
Burlington Coat Factory of Nebraska, LLC
Burlington Coat Realty of Las Vegas, Inc.
Burlington Coat Factory of Nevada, LLC
Burlington Coat Factory of New Hampshire, LLC
Burlington Coat Factory Direct Corporation
Burlington Coat Factory Warehouse of Edgewater Park, Inc.
Burlington Coat Factory Warehouse of New Jersey, Inc.
MJM Designer Shoes of Moorestown, Inc.
Super Baby Depot of Moorestown, Inc.
Burlington Coat Factory Realty of Edgewater Park, Inc.
Burlington Coat Factory Realty of Paramus, Inc.
Burlington Coat Factory Realty of Pinebrook, Inc.
Burlington Coat Factory Warehouse of Edgewater Park Urban Renewal Corp.
Burlington Coat Factory of New Jersey, LLC
Cohoes Fashions of New Jersey, LLC
MJM Designer Shoes of New Jersey, LLC
Burlington Coat Factory of New Mexico, LLC
LC Acquisition Corp.
Georgetown Fashions Inc.
Monroe G. Milstein, Inc.
Burlington Coat Factory Realty of Yonkers, Inc.
Burlington Coat Factory of New York, LLC
Cohoes Fashions of New York, LLC
MJM Designer Shoes of New York, LLC
Burlington Coat Factory of North Carolina, LLC
Burlington Coat Factory of North Dakota, LLC
Burlington Coat Factory Warehouse of Cleveland, Inc.
Burlington Coat Factory of Ohio, LLC
Burlington Coat Factory Realty of Tulsa, Inc.
Burlington Coat Factory of Oklahoma, LLC
Burlington Coat Factory of Oregon, LLC
Burlington Coat Factory Warehouse Inc.
Burlington Coat Factory Warehouse of Cheltenham, Inc.
Burlington Coat Factory Warehouse of Langhorne, Inc.
Burlington Coat Factory Warehouse of Montgomeryville, Inc.
Burlington Coat Factory Realty of West Mifflin, Inc.
Burlington Coat Factory Realty of Langhorne, Inc.
Burlington Coat Factory Realty of Whitehall, Inc.
Burlington Factory Warehouse of Reading, Inc.
Burlington Coat Factory Warehouse of Bristol, LLC
Burlington Coat Factory of Pennsylvania, LLC
MJM Designer Shoes of Pennsylvania, LLC
Burlington Coat Factory of Puerto Rico, LLC
Cohoes Fashions of Cranston, Inc.
Burlington Coat Factory of Rhode Island, LLC
Burlington Coat Factory Warehouse of Charleston, Inc.
Burlington Coat Factory of South Carolina, LLC
Burlington Coat Factory of South Dakota, LLC
Burlington Coat Factory Warehouse of Hickory Commons, Inc.
Burlington Coat Factory Warehouse of Memphis, Inc.
Burlington Coat Factory Warehouse of Shelby, Inc.
Burlington Coat Factory Realty of Memphis, Inc.
Burlington Coat Realty of Plano, Inc.
Burlington Coat Factory Warehouse of Baytown, Inc.
M J M Designer Shoes of Texas, Inc.
Burlington Coat Realty of Houston, Inc.
Burlington Coat Factory Realty of Westmoreland, Inc.
Burlington Coat Factory Realty of Bellaire, Inc.
Burlington Coat Factory Realty of El Paso, Inc.
Burlington Coat Factory of Utah, LLC
Burlington Coat Factory of Vermont, LLC
BCF Cards, Inc.
Burlington Coat Factory Warehouse of Coliseum, Inc.
Burlington Coat Realty of Potomac, Inc.
Burlington Coat Factory Realty of Fairfax, Inc.
Burlington Coat Factory Realty of Coliseum, Inc.
Burlington Coat Factory of Virginia, LLC
Burlington Coat Factory of Pocono Crossing, LLC
Burlington Coat Factory Realty of Franklin, Inc.
Burlington Coat Factory of Washington, LLC
Burlington Coat Factory of West Virginia, LLC
Burlington Coat Factory of Wisconsin, LLC
Exhibit 4.2
FIRST SUPPLEMENTAL INDENTURE
THIS FIRST SUPPLEMENTAL INDENTURE (this “ Supplemental Indenture ”), dated as of February 24, 2011, is made by and among Burlington Coat Factory Investments Holdings, Inc., a Delaware corporation (the “ Company ”) and Wilmington Trust FSB (as successor trustee to Wells Fargo Bank, N.A.), as Trustee (the “ Trustee ”).
RECITALS:
WHEREAS, the Company and the Trustee are parties to an Indenture dated as of April 13, 2006 (as amended, supplemented or otherwise modified from time to time, the “ Indenture ”).
WHEREAS, pursuant to the Indenture, the Company issued and the Trustee authenticated and delivered an aggregate principal amount at maturity of $99,309,000 of the Company’s 14 1 / 2 % Senior Discount Notes due 2014 (the “ Notes ”), of which $99,309,000 at maturity is currently outstanding.
WHEREAS, Section 9.2 of the Indenture provides, among other things, that with the consent of the holders (the “ Holders ”) of at least a majority in aggregate principal amount of the Notes then outstanding (the “ Requisite Consents ”), the Company and the Trustee may amend the Indenture or the Notes.
WHEREAS, on February 9, 2011, the Company distributed an Offer to Purchase and Consent Solicitation Statement (as amended, modified, or supplemented, the “ Offer to Purchase ”) to each Holder.
WHEREAS, the Company has obtained the Requisite Consents to amend the Indenture as set forth in the Offer to Purchase (the “ Amendments ”).
WHEREAS, this Supplemental Indenture has been duly authorized by all necessary corporate action on the part of the Company.
WHEREAS, the Company has delivered, or caused to be delivered, to the Trustee an Officer’s Certificate and an Opinion of Counsel meeting the requirements of Sections 12.4 and 12.5 of the Indenture.
NOW THEREFORE , each party agrees for the benefit of the other parties and for the equal and ratable benefit of all Holders, as follows:
AGREEMENT:
Section 1. Definitions . Capitalized terms used in this Supplemental Indenture and not otherwise defined herein have the meanings given to them in the Indenture. Sections 1.1 and 1.2 of the Indenture are hereby amended to delete in their entirety all terms and their respective definitions for which all references are eliminated in the Indenture as a result of the amendments set forth in Section 2.1 below.
Section 2. Amendments.
2.1 Amendment of Certain Sections of the Indenture . The Indenture is hereby amended by deleting the following sections of the Indenture and all references thereto in the Indenture in their entirety:
(a) Section 4.3 - Provision of Financial Information
(b) Section 4.4 - Compliance Certificate
(c) Section 4.5 - Taxes
(d) Section 4.6 - Stay, Extension and Usury Laws
(e) Section 4.7 - Limitation on Restricted Payments
(f) Section 4.8 - Limitation on Dividends and Other Payment Restrictions Affecting Subsidiaries
(g) Section 4.9 - Limitation on Incurrence of Debt
(h) Section 4.10 - Limitation on Merger, Consolidation or Sale of Assets
(i) Section 4.11 - Limitation on Transactions with Affiliates
(j) Section 4.12 - Limitation on Liens
(k) Section 4.13 - Payments for Consent
(l) Section 4.14 - Offer to Purchase upon Change of Control
(m) Section 4.15 - Corporate Existence
(n) Section 4.16 - Business Activities
(o) Section 4.17 - Limitation on Issuance of Guarantees
(p) Section 4.18 - Limitation on Creation of Unrestricted Subsidiaries
(q) Section 4.19 - Further Instruments and Acts
(r) Section 5.1 - Consolidation, Merger, Conveyance, Transfer or Lease
(s) Section 5.2 - Successor Corporation Substituted
2
2.2 Amendments to Events of Defaults in the Indenture . Section 6.1 of the Indenture, “ Events of Default” is hereby amended and restated in its entirety as follows:
SECTION 6.1 Events of Default .
Each of the following consitutes an “ Event of Default” :
(1) the Company defaults in payment when due and payable, upon redemption, acceleration or otherwise, of principal of, or premium, if any, on the Notes; and
(2) the Company defaults in the payment when due of interest or Additional Interest, if any, on or with respect to the Notes and such default continues for a period of 30 days.
(3) Reserved.
(4) Reserved.
(5) Reserved.
(6) Reserved.
Section 3. Miscellaneous.
3.1 Effect of Supplemental Indenture . Upon the execution and delivery of this Supplemental Indenture by the Company and the Trustee, the Indenture shall be supplemented in accordance herewith, and this Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder holding Notes that have been heretofore or hereafter authenticated and delivered under the Indenture shall be bound thereby; provided , however, that Sections 1 and 2.1 hereof shall not become operative unless and until the date (the “ Operative Date ”) set forth in a notice from the Company to the Trustee, stating that all the Notes that were validly tendered and not withdrawn at or prior to the Early Acceptance Date (as defined in the Offer to Purchase) were purchased on the Early Payment Date (as defined in the Offer to Purchase).
3.2 Indenture Remains in Full Force and Effect . Except as supplemented hereby, all provisions of the Indenture shall remain in full force and effect.
3.3 Indenture and Supplemental Indenture Construed Together . This Supplemental Indenture is an indenture supplemental to and in implementation of the Indenture, and the Indenture and this Supplemental Indenture shall henceforth be read and construed together.
3.4 Confirmation and Preservation of the Indenture . The Indenture as supplemented by this Supplemental Indenture is in all respects confirmed and preserved.
3.5 Conflict with Trust Indenture Act . If any provision of this Supplemental Indenture limits, qualifies, or conflicts with any provision of the Trust Indenture Act of 1939, as amended (the “ Act ”), that is required under such Act to be part of and govern any provision of this Supplemental Indenture, the provision of such Act shall control. If any provision of this Supplemental Indenture modifies or excludes any provision of the Act that may be so modified or excluded, the provisions of the Act shall be deemed to apply to the
3
Indenture as so modified or to be excluded by this Supplemental Indenture, as the case may be.
3.6 Trustee Not Responsible for Recitals . The recitals contained herein shall be taken as the statements of the Company and the Trustee assumes no responsibility for their correctness. The Trustee makes no representation as to the validity or adequacy of this Supplemental Indenture.
3.7 Certain Duties and Responsibilities of the Trustee . In entering into this Supplemental Indenture, the Trustee shall be entitled to the benefit of every provision of the Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee, whether or not elsewhere herein so provided, including specifically the Trustee’s rights to indemnification contained in Section 7.2 of the Indenture.
3.8 Separability Clause . In case any provision of this Supplemental Indenture shall be invalid, illegal, or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
3.9 Effect of Headings . The Section and Subsection headings herein are for convenience only and shall not affect the construction hereof.
3.10 Benefits of Supplemental Indenture . Nothing in this Supplemental Indenture, the Indenture, or the Notes, express or implied, shall give to any Person, other than the parties hereto and thereto and their successors hereunder and thereunder, and the Holders, any benefit of any legal or equitable right, remedy, or claim under the Indenture, this Supplemental Indenture, or the Notes.
3.11 Successors and Assigns . All covenants and agreements in this Supplemental Indenture by the Company shall bind its successors and permitted assigns, whether so expressed or not.
3.12 Governing Law . THIS SUPPLEMENTAL INDENTURE SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
3.13 Counterparts . This Supplemental Indenture may be executed in counterparts (including by means of facsimile signature pages), each of which shall be an original, but all such counterparts shall together constitute one and the same instrument.
[Remainder of Page Blank — Signature Pages Follow]
4
IN WITNESS WHEREOF , the parties hereto have caused this Supplemental Indenture to be duly executed as of the date and the year first written above.
| Burlington Coat Factory Investments Holdings, Inc. | ||
| By: | /s/ Robert LaPenta, Jr. | |
| Name: Robert LaPenta, Jr. | ||
| Title: Vice President and Treasurer | ||
| Wilmington Trust FSB, as Trustee | ||
| By | /s/ Jane Schweiger | |
| Name: Jane Schweiger | ||
| Title: Vice President | ||
Exhibit 4.3
BURLINGTON COAT FACTORY
WAREHOUSE CORPORATION
10.000% SENIOR NOTES DUE 2019
INDENTURE
DATED AS OF February 24, 2011
WILMINGTON TRUST FSB
Trustee
CROSS-REFERENCE TABLE*
|
Trust Indenture
|
Section
Indenture |
|
|
310 (a)(1) |
7.10 | |
|
(a)(2) |
7.10 | |
|
(a)(3) |
N.A. | |
|
(a)(4) |
N.A. | |
|
(a)(5) |
7.10 | |
|
(b) |
7.3; 7.10 | |
|
(c) |
N.A. | |
|
311(a) |
7.11 | |
|
(b) |
7.11 | |
|
(c) |
N.A. | |
|
312(a) |
2.5 | |
|
(b) |
12.3 | |
|
(c) |
12.3 | |
|
313(a) |
7.6 | |
|
(b)(1) |
7.6 | |
|
(b)(2) |
7.6; 7.7 | |
|
(c) |
7.6; 12.2 | |
|
(d) |
7.6 | |
|
314(a) |
4.3; 12.5 | |
|
(b) |
10.2 | |
|
(c)(1) |
12.4 | |
|
(c)(2) |
12.4 | |
|
(c)(3) |
N.A. | |
|
(d) |
9.1 | |
|
(e) |
12.5 | |
|
(f) |
N.A. | |
|
315(a) |
7.1 | |
|
(b) |
7.5; 12.2 | |
|
(c) |
7.1 | |
|
(d) |
7.1 | |
|
(e) |
6.11 | |
|
316(a) (last sentence) |
2.9 | |
|
(a)(1)(A) |
6.5 | |
|
(a)(1)(B) |
6.4 | |
|
(a)(2) |
N.A. | |
|
(b) |
6.7 | |
|
(c) |
2.13 | |
|
317(a)(1) |
6.8 | |
|
(a)(2) |
6.9 | |
|
(b) |
2.4 | |
|
318(a) |
12.1 | |
|
(b) |
N.A. | |
|
(c) |
12.1 |
| N.A. | means not applicable. |
| * | This Cross-Reference Table is not part of the Indenture. |
TABLE OF CONTENTS
| Page | ||||||
| ARTICLE I | ||||||
| DEFINITIONS AND INCORPORATION BY REFERENCE | ||||||
|
SECTION 1.1 |
Definitions. |
1 | ||||
|
SECTION 1.2 |
Other Definitions. |
34 | ||||
|
SECTION 1.3 |
Incorporation by Reference of Trust Indenture Act. |
35 | ||||
|
SECTION 1.4 |
Rules of Construction. |
35 | ||||
| ARTICLE II | ||||||
| THE NOTES | ||||||
|
SECTION 2.1 |
Form and Dating. |
36 | ||||
|
SECTION 2.2 |
Execution and Authentication. |
38 | ||||
|
SECTION 2.3 |
Registrar; Paying Agent. |
38 | ||||
|
SECTION 2.4 |
Paying Agent to Hold Money in Trust. |
39 | ||||
|
SECTION 2.5 |
Holder Lists. |
39 | ||||
|
SECTION 2.6 |
Book-Entry Provisions for Global Securities. |
40 | ||||
|
SECTION 2.7 |
Replacement Notes. |
42 | ||||
|
SECTION 2.8 |
Outstanding Notes. |
43 | ||||
|
SECTION 2.9 |
Treasury Notes. |
43 | ||||
|
SECTION 2.10 |
Temporary Notes. |
43 | ||||
|
SECTION 2.11 |
Cancellation. |
43 | ||||
|
SECTION 2.12 |
Defaulted Interest. |
44 | ||||
|
SECTION 2.13 |
Record Date. |
44 | ||||
|
SECTION 2.14 |
Computation of Interest. |
44 | ||||
|
SECTION 2.15 |
CUSIP Number. |
44 | ||||
|
SECTION 2.16 |
Special Transfer Provisions. |
44 | ||||
|
SECTION 2.17 |
Issuance of Additional Notes. |
46 | ||||
| ARTICLE III | ||||||
| REDEMPTION AND PREPAYMENT | ||||||
|
SECTION 3.1 |
Notices to Trustee. |
47 | ||||
|
SECTION 3.2 |
Selection of Notes to Be Redeemed. |
47 | ||||
|
SECTION 3.3 |
Notice of Redemption. |
48 | ||||
|
SECTION 3.4 |
Effect of Notice of Redemption. |
49 | ||||
|
SECTION 3.5 |
Deposit of Redemption of Purchase Price. |
49 | ||||
|
SECTION 3.6 |
Notes Redeemed in Part. |
49 | ||||
|
SECTION 3.7 |
Optional Redemption. |
50 | ||||
|
SECTION 3.8 |
Mandatory Redemption. |
50 | ||||
-i-
| Page | ||||||
|
SECTION 3.9 |
Offer to Purchase. |
51 | ||||
| ARTICLE IV | ||||||
| COVENANTS | ||||||
|
SECTION 4.1 |
Payment of Notes. |
52 | ||||
|
SECTION 4.2 |
Maintenance of Office or Agency. |
52 | ||||
|
SECTION 4.3 |
Provision of Financial Information. |
52 | ||||
|
SECTION 4.4 |
Compliance Certificate. |
54 | ||||
|
SECTION 4.5 |
Taxes. |
54 | ||||
|
SECTION 4.6 |
Stay, Extension and Usury Laws. |
54 | ||||
|
SECTION 4.7 |
Limitation on Restricted Payments. |
55 | ||||
|
SECTION 4.8 |
Limitation on Dividends and Other Payment Restrictions Affecting Subsidiaries. |
62 | ||||
|
SECTION 4.9 |
Indebtedness and Issuance of Preferred Stock. |
63 | ||||
|
SECTION 4.10 |
Asset Sales. |
69 | ||||
|
SECTION 4.11 |
Limitation on Transactions with Affiliates. |
71 | ||||
|
SECTION 4.12 |
Limitation on Liens. |
73 | ||||
|
SECTION 4.13 |
Payments for Consent. |
73 | ||||
|
SECTION 4.14 |
Offer to Purchase upon Change of Control. |
73 | ||||
|
SECTION 4.15 |
Corporate Existence. |
75 | ||||
|
SECTION 4.16 |
Business Activities. |
75 | ||||
|
SECTION 4.17 |
Additional Guarantees. |
75 | ||||
|
SECTION 4.18 |
[Reserved]. |
76 | ||||
|
SECTION 4.19 |
Further Instruments and Acts. |
76 | ||||
|
SECTION 4.20 |
Suspension of Covenants |
76 | ||||
| ARTICLE V | ||||||
| SUCCESSORS | ||||||
|
SECTION 5.1 |
Consolidation, Merger, Conveyance, Transfer or Lease. |
76 | ||||
|
SECTION 5.2 |
Successor Corporation Substituted. |
78 | ||||
| ARTICLE VI | ||||||
| DEFAULTS AND REMEDIES | ||||||
|
SECTION 6.1 |
Events of Default. |
78 | ||||
|
SECTION 6.2 |
Acceleration. |
80 | ||||
|
SECTION 6.3 |
Other Remedies. |
81 | ||||
|
SECTION 6.4 |
Waiver of Past Defaults. |
82 | ||||
|
SECTION 6.5 |
Control by Majority. |
82 | ||||
|
SECTION 6.6 |
Limitation on Suits. |
82 | ||||
|
SECTION 6.7 |
Rights of Holders of Notes to Receive Payment. |
83 | ||||
-ii-
| Page | ||||||
|
SECTION 6.8 |
Collection Suit by Trustee. |
83 | ||||
|
SECTION 6.9 |
Trustee May File Proofs of Claim. |
83 | ||||
|
SECTION 6.10 |
Priorities. |
84 | ||||
|
SECTION 6.11 |
Undertaking for Costs. |
84 | ||||
| ARTICLE VII | ||||||
| TRUSTEE | ||||||
|
SECTION 7.1 |
Duties of Trustee. |
84 | ||||
|
SECTION 7.2 |
Rights of Trustee. |
86 | ||||
|
SECTION 7.3 |
Individual Rights of Trustee. |
87 | ||||
|
SECTION 7.4 |
Trustee’s Disclaimer. |
87 | ||||
|
SECTION 7.5 |
Notice of Defaults. |
87 | ||||
|
SECTION 7.6 |
Reports by Trustee to Holders of the Notes. |
88 | ||||
|
SECTION 7.7 |
Compensation and Indemnity. |
88 | ||||
|
SECTION 7.8 |
Replacement of Trustee. |
89 | ||||
|
SECTION 7.9 |
Successor Trustee by Merger, Etc. |
90 | ||||
|
SECTION 7.10 |
Eligibility; Disqualification. |
90 | ||||
|
SECTION 7.11 |
Preferential Collection of Claims Against the Company. |
90 | ||||
|
SECTION 7.12 |
Trustee’s Application for Instructions from the Company. |
90 | ||||
| ARTICLE VIII | ||||||
| DEFEASANCE; DISCHARGE OF THE INDENTURE | ||||||
|
SECTION 8.1 |
Option to Effect Legal Defeasance or Covenant Defeasance. |
91 | ||||
|
SECTION 8.2 |
Legal Defeasance. |
91 | ||||
|
SECTION 8.3 |
Covenant Defeasance. |
91 | ||||
|
SECTION 8.4 |
Conditions to Legal or Covenant Defeasance. |
92 | ||||
|
SECTION 8.5 |
Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions. |
93 | ||||
|
SECTION 8.6 |
Repayment to Company. |
94 | ||||
|
SECTION 8.7 |
Reinstatement. |
94 | ||||
|
SECTION 8.8 |
Discharge. |
95 | ||||
| ARTICLE IX | ||||||
| AMENDMENT, SUPPLEMENT AND WAIVER | ||||||
|
SECTION 9.1 |
Without Consent of Holders of the Notes. |
96 | ||||
|
SECTION 9.2 |
With Consent of Holders of Notes. |
97 | ||||
|
SECTION 9.3 |
Compliance with Trust Indenture Act. |
98 | ||||
|
SECTION 9.4 |
Revocation and Effect of Consents. |
98 | ||||
|
SECTION 9.5 |
Notation on or Exchange of Notes. |
98 | ||||
|
SECTION 9.6 |
Trustee to Sign Amendments, Etc. |
99 | ||||
-iii-
| ARTICLE X | ||||||
| [RESERVED] | ||||||
| ARTICLE XI | ||||||
| NOTE GUARANTEES | ||||||
|
SECTION 11.1 |
Guarantees. |
99 | ||||
|
SECTION 11.2 |
Execution and Delivery of Guarantee. |
100 | ||||
|
SECTION 11.3 |
Severability. |
101 | ||||
|
SECTION 11.4 |
Limitation of Guarantors’ Liability. |
101 | ||||
|
SECTION 11.5 |
Guarantors May Consolidate, Etc., on Certain Terms. |
101 | ||||
|
SECTION 11.6 |
Releases Following Sale of Assets. |
102 | ||||
|
SECTION 11.7 |
Release of a Guarantor. |
103 | ||||
|
SECTION 11.8 |
Benefits Acknowledged. |
103 | ||||
|
SECTION 11.9 |
Future Guarantors. |
103 | ||||
| ARTICLE XII | ||||||
| MISCELLANEOUS | ||||||
|
SECTION 12.1 |
Trust Indenture Act Controls. |
103 | ||||
|
SECTION 12.2 |
Notices. |
103 | ||||
|
SECTION 12.3 |
No Personal Liability of Directors, Officers, Employees and Stockholders. |
105 | ||||
|
SECTION 12.4 |
Certificate and Opinion as to Conditions Precedent. |
105 | ||||
|
SECTION 12.5 |
Statements Required in Certificate or Opinion. |
105 | ||||
|
SECTION 12.6 |
Rules by Trustee and Agents. |
106 | ||||
|
SECTION 12.7 |
[Reserved]. |
106 | ||||
|
SECTION 12.8 |
Governing Law. |
106 | ||||
|
SECTION 12.9 |
No Adverse Interpretation of Other Agreements. |
106 | ||||
|
SECTION 12.10 |
Successors. |
106 | ||||
|
SECTION 12.11 |
Severability. |
106 | ||||
|
SECTION 12.12 |
Counterpart Originals. |
107 | ||||
|
SECTION 12.13 |
Table of Contents, Headings, Etc. |
107 | ||||
|
SECTION 12.14 |
Acts of Holders. |
107 | ||||
| EXHIBITS | ||||||
|
Exhibit A |
FORM OF NOTE |
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|
Exhibit B |
FORM OF NOTATIONAL GUARANTEE |
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|
Exhibit C |
FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH TRANSFERS PURSUANT TO RULE 144A |
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|
Exhibit D |
FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH TRANSFERS PURSUANT TO REGULATIONS |
|||||
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This Indenture, dated as of February 24, 2011 is by and among Burlington Coat Factory Warehouse Corporation, a Delaware corporation (the “ Company ”), the initial guarantors listed on the signature pages hereto (the “ Guarantors ”) and Wilmington Trust FSB, as trustee (the “ Trustee ”).
The Company, the Guarantors and the Trustee agree as follows for the benefit of each other and for the equal and ratable benefit of the holders of (i) the Company’s 10.000% Senior Notes due 2019 issued on the date hereof (the “ Initial Notes ”) and (ii) Additional Notes (together with the Initial Notes, the “ Notes ”):
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.1 Definitions .
“ ABL Facilit y” means that certain Amended and Restated Credit Agreement, dated as of January 15, 2010, among Holdings, the Company, the facility guarantors party thereto, Bank of America, N.A., as Administrative Agent and Collateral Agent, the lenders party thereto, Wells Fargo Retail Finance, LLC and Regions Bank as Co-Syndication Agents, J.P. Morgan Securities Inc. and UBS Securities LLC as Co-Documentation Agents and General Electric Capital Corporation, US Bank, National Association and SunTrust Bank as Senior Managing Agents, including any related notes, guarantees, collateral documents, instruments and agreements executed in connection therewith, and in each case as amended, restated, supplemented, modified, renewed, refunded, replaced (whether at maturity or thereafter) or refinanced from time to time in one or more agreements or indentures (in each case with the same or new agents, lenders or institutional investors), including any agreement adding or changing the borrower or any guarantor or extending the maturity thereof or otherwise restructuring all or any portion of the Indebtedness thereunder or increasing the amount loaned or issued thereunder or altering the maturity thereof ( provided that such increase in borrowings is permitted under Section 4.9 ).
“ Acquired Debt ” means, with respect to any specified Person:
(a) Indebtedness of any other Person existing at the time such other Person is merged with or into or became a Restricted Subsidiary of such specified Person, including Indebtedness incurred in connection with, or in contemplation of, or to provide all or any portion of the funds or credit support utilized in connection with, such other Person merging with or into, or becoming a Restricted Subsidiary of, such specified Person; and
(b) Indebtedness secured by an existing Lien encumbering any asset acquired by such specified Person.
“ Additional Interest ” has the meaning set forth in the Registration Rights Agreement.
“ Additional Notes ” means Notes (other than the Initial Notes) issued pursuant to Article II hereof and otherwise in compliance with the provisions of this Indenture.
“ Affiliate ” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For purposes of this definition, “ control ” (including, with correlative meanings, the terms “ controlling ,” “ controlled by ” and “ under common control with ”), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise.
“ Agent ” means any Registrar, Paying Agent or co-registrar.
“ Applicable Four-Quarter Period ” means for any period ending (i) prior to January 29, 2011, the last twelve fiscal months prior to such measurement date and (ii) on or after January 29, 2011 the previous four fiscal quarter period prior to such measurement date.
“ Applicable Premium ” means, with respect to any Note on any applicable redemption date, the excess of:
(a) the present value at such redemption date of (i) the redemption price at February 15, 2015, with respect to such Note (such redemption price being set forth in Section 3.7(b) ) plus (ii) all required interest payments due on such Note through February 15, 2015 (excluding accrued but unpaid interest to the date of redemption) computed using a discount rate equal to the Treasury Rate as of such redemption date plus 50 basis points; over
(b) the then outstanding principal amount of such Note.
“ Asset Sale ” means (i) the sale, conveyance, transfer, lease (as lessor) or other voluntary disposition (whether in a single transaction or a series of related transactions) of property or assets (including by way of a sale and leaseback) of the Company (other than the sale of Equity Interests of the Company) or any of its Restricted Subsidiaries (each referred to in this definition as a “ disposition ”) or (ii) the issuance or sale of Equity Interests of any Restricted Subsidiary (whether in a single transaction or a series of related transactions), in each case, other than:
(a) a disposition of Cash Equivalents or obsolete, damaged or worn out property or equipment in the ordinary course of business or inventory (or other assets) held for sale in the ordinary course of business and dispositions of property no longer used or useful in the conduct of the business of the Company and its Restricted Subsidiaries or the disposition of inventory in the ordinary course of business;
(b) the disposition of all or substantially all of the assets of the Company in a manner permitted pursuant to Section 4.10 or any disposition that constitutes a Change of Control;
(c) the making of any Restricted Payment or Permitted Investment that is permitted to be made, and is made, pursuant to Section 4.7 or the granting of a Lien permitted by Section 4.12 ;
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(d) any disposition of assets or issuance or sale of Equity Interests of any Restricted Subsidiary (other than directors’ qualifying shares or shares required by applicable law to be held by a Person other than the Company or a Restricted Subsidiary) in any transaction or series of transactions with an aggregate fair market value of less than $5.0 million;
(e) any disposition of property or assets or issuance of securities by a Restricted Subsidiary to the Company or by the Company or a Restricted Subsidiary to another Restricted Subsidiary;
(f) the lease, assignment, sublease, license or sublicense of any real or personal property in the ordinary course of business;
(g) any sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;
(h) foreclosures on assets or transfers by reason of eminent domain;
(i) disposition of an account receivable in connection with the collection or compromise thereof;
(j) sales of Securitization Assets and related assets of the type specified in the definition of “Securitization Financing” to a Securitization Subsidiary in connection with any Qualified Securitization Financing; and
(k) a transfer of Securitization Assets and related assets of the type specified in the definition of “Securitization Financing” (or a fractional undivided interest therein) by a Securitization Subsidiary in a Qualified Securitization Financing.
“ Asset Sale Offer ” means an Offer to Purchase required to be made by the Company pursuant to Section 4.10 to all Holders.
“ Bankruptcy Law ” means Title 11, U.S. Code or any similar Federal, state or foreign law for the relief of debtors.
“ Beneficial Owner ” has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating the beneficial ownership of any particular “person” (as that term is used in Section 13(d)(3) of the Exchange Act), such “person” will be deemed to have beneficial ownership of all securities that such “person” has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent condition. The term “ Beneficial Ownership ” has a corresponding meaning.
“ Board of Directors ” means:
(a) with respect to a corporation, the board of directors of the corporation;
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(b) with respect to a partnership, the board of directors of the general partner of the partnership; and
(c) with respect to any other Person, the board or committee of such Person serving a similar function.
“ Board Resolution ” means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company or any Restricted Subsidiary to have been duly adopted by the Board of Directors, unless the context specifically requires that such resolution be adopted by a majority of the Disinterested Directors, in which case by a majority of such directors, and to be in full force and effect on the date of such certification and delivered to the Trustee.
“ Borrowing Base ” means, as of any date, an amount equal to the sum of (x) 95% of the face value of all accounts receivable of the Company and its Restricted Subsidiaries and (y) 65% of the net book value of all inventory owned by the Company and its Restricted Subsidiaries, in each case, calculated on a consolidated basis; provided, however , that if Indebtedness is being incurred to finance an acquisition pursuant to which any accounts receivable or inventory will be acquired (whether through the direct acquisition of assets or the acquisition of Capital Stock of a Person), the Borrowing Base shall be calculated to give appropriate pro forma effect to any increase in the amount of the Company’s and its Restricted Subsidiaries’ accounts receivable and inventory resulting from such acquisition.
“ Business Day ” means any day other than a Legal Holiday.
“ Capital Stock ” means:
(1) in the case of a corporation, capital stock;
(2) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of capital stock;
(3) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and
(4) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets, the issuing Person.
“ Capitalized Lease Obligation ” means, at the time any determination thereof is to be made, the amount of the liability in respect of a capital lease that would at such time be required to be capitalized and reflected as a liability on a balance sheet (excluding the footnotes thereto) in accordance with GAAP (except for temporary treatment of construction-related expenditures under EITF 97-10, “The Effect of Lessee Involvement in Asset Construction,” which will ultimately be treated as operating leases upon a sale and leaseback transaction).
“ Cash Contribution Amount ” means the aggregate amount of cash contributions made to the capital of the Company or any other Guarantor described in the definition of “Contribution Indebtedness.”
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“ Cash Equivalents ” means:
(a) U.S. dollars or, in the case of any Foreign Subsidiary, such local currencies held by it from time to time in the ordinary course of business;
(b) securities issued or directly and fully and unconditionally guaranteed or insured by the government or any agency or instrumentality of the United States, the United Kingdom or any member state of the European Union whose legal tender is the euro having maturities of not more than 12 months from the date of acquisition;
(c) certificates of deposit, time deposits and eurodollar time deposits with maturities of 12 months or less from the date of acquisition, bankers’ acceptances with maturities not exceeding 12 months and overnight bank deposits, in each case, with any lender party to either Credit Facility or with any commercial bank having capital and surplus in excess of $250 million;
(d) repurchase obligations for underlying securities of the types described in clauses (b) and (c) above entered into with any financial institution meeting the qualifications specified in clause (c) above;
(e) commercial paper maturing within 12 months after the date of acquisition and having a rating of at least A-1 from Moody’s or P-1 from S&P;
(f) readily marketable direct obligations issued by any state of the United States or any political subdivision thereof having one of the two highest rating categories obtainable from either Moody’s or S&P with maturities of 12 months or less from the date of acquisition;
(g) instruments equivalent to those referred to in clauses (a) to (f) above denominated in euro or pounds sterling or any other foreign currency comparable in credit quality and tenor to those referred to above and customarily used by corporations for cash management purposes in any jurisdiction outside the United States to the extent reasonably required in connection with any business conducted by any Restricted Subsidiary organized in such jurisdiction; and
(h) investment in funds which invest substantially all of their assets in Cash Equivalents of the kinds described in clauses (a) through (g) of this definition.
“ Certificated Notes ” means Notes that are in the form of Exhibit A attached hereto other than Global Notes.
“ Change of Control ” means the occurrence of any of the following:
(a) the sale, lease, transfer or other conveyance, in one or a series of related transactions, of all or substantially all of the assets of the Company and its Subsidiaries, taken as a whole, to any Person other than to a Permitted Holder; or
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(b) the Company becomes aware of (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) the acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than the Permitted Holders, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of Beneficial Ownership, directly or indirectly, of 50% or more of the total voting power of the Voting Stock of the Company or any of its direct or indirect parent entities, including Holdings.
“ Change of Control Offer ” means an Offer to Purchase required to be made by the Company pursuant to Section 4.14 to all Holders.
“ Code ” means the United States Internal Revenue Code of 1986, as amended from time to time, and the regulations promulgated and rulings issued thereunder. Section references to the Code are to the Code as in effect on the Issue Date and any subsequent provisions of the Code amendatory thereof, supplemental thereto or substituted therefor.
“ Commission ” means the U.S. Securities and Exchange Commission and any successor thereto.
“ Common Stock ” of any Person means Capital Stock in such Person that do not rank prior, as to the payment of dividends or as to the distribution of assets upon any voluntary or involuntary liquidation, dissolution or winding up of such Person, to Capital Stock of any other class in such Person.
“ Company ” means Burlington Coat Factory Warehouse Corporation and any successor thereto.
“ Consolidated Depreciation and Amortization Expense ” means, with respect to any Person for any period, the total amount of depreciation and amortization expense, including the amortization of deferred financing fees, and other noncash charges (excluding any noncash item that represents an accrual or reserve for a cash expenditure for a future period) of such Person and its Restricted Subsidiaries for such period on a consolidated basis and otherwise determined in accordance with GAAP.
“ Consolidated Interest Expense ” means, with respect to any Person for any period, the sum, without duplication, of: (a) consolidated interest expense of such Person and its Restricted Subsidiaries for such period (including amortization of original issue discount, noncash interest payments (other than imputed interest as a result of purchase accounting), commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing, the interest component of Capitalized Lease Obligations, net payments (if any) pursuant to interest rate Hedging Obligations (any net receipts pursuant to such interest rate Hedging Obligations shall be included as a reduction to Consolidated Interest Expense), but excluding amortization of deferred financing fees or expensing of any bridge or other financing fees and any loss on the early extinguishment of Indebtedness) and (b) consolidated capitalized
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interest of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, less (c) interest income actually received or receivable in cash for such period; provided, however , that Securitization Fees shall not be deemed to constitute Consolidated Interest Expense.
“ Consolidated Net Income ” means, with respect to any Person for any period, the aggregate of the Net Income of such Person and its Restricted Subsidiaries for such period, on a consolidated basis, and otherwise determined in accordance with GAAP; provided , however , that
(a) any extraordinary (net of any tax effect), unusual or nonrecurring gains, losses, costs, charges or expenses (including, without limitation, severance, relocation, transition and other restructuring costs and litigation settlements or losses) shall be excluded;
(b) the Net Income for such period shall not include the cumulative effect of a change in accounting principle(s) during such period;
(c) any net after-tax gains or losses attributable to asset dispositions other than in the ordinary course of business (as determined in good faith by the Board of Directors of the Company) and any gain (or loss) realized upon the sale or other disposition of any Capital Stock of any Person shall be excluded;
(d) the Net Income for such period of any Person that is not a Subsidiary of such Person, or that is an Unrestricted Subsidiary, or that is accounted for by the equity method of accounting, shall be excluded; provided that, to the extent not already included, Consolidated Net Income of such Person shall be (A) increased by the amount of dividends or other distributions that are actually paid in cash (or to the extent converted into cash) to the referent Person or a Restricted Subsidiary thereof in respect of such period (subject in the case of dividends paid or distributions made to a Restricted Subsidiary (other than a Guarantor) to the limitations contained in clause (e) below) and (B) decreased by the amount of any equity of the Company in a net loss of any such Person for such period to the extent the Company has funded such net loss in cash with respect to such period;
(e) solely for the purpose of determining the amount available for Restricted Payments under Section 4.7(3) , the Net Income for such period of any Restricted Subsidiary (other than a Guarantor) shall be excluded if the declaration or payment of dividends or similar distributions by that Restricted Subsidiary of its Net Income is not permitted at the date of determination without any prior governmental approval (which has not been obtained) or, directly or indirectly, by the operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders, unless such restriction with respect to the payment of dividends or similar distributions has been legally waived; provided that the Consolidated Net Income of such Person shall be, subject to the exclusion contained in clause (c) above, increased by the amount of dividends or similar distributions that are actually paid in cash (or to the extent converted
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into cash) to such Person or a Restricted Subsidiary thereof (subject to the provisions of this clause (e)) in respect of such period, to the extent not already included therein;
(f) noncash compensation charges, including any such charges arising from stock options, restricted stock grants or other equity-incentive programs, shall be excluded;
(g) any net after-tax gains or losses and all fees and expenses or charges relating thereto attributable to the early extinguishment of Indebtedness shall be excluded;
(h) the effect of any noncash items resulting from any amortization, write-up, write-down or write-off of assets (including intangible assets, goodwill and deferred financing costs in connection with the Transactions or any future acquisition, disposition, merger, consolidation or similar transaction or any other noncash impairment charges incurred subsequent to the Issue Date resulting from the application of SFAS Nos. 141, 142 or 144) (excluding any such noncash item to the extent that it represents an accrual of or reserve for cash expenditures in any future period except to the extent such item is subsequently reversed) shall be excluded;
(i) any net gain or loss resulting from Hedging Obligations (including pursuant to the application of SFAS No. 133) shall be excluded; and
(j) any net after-tax income or loss from discontinued operations and any net after-tax gains or losses on disposal of discontinued operations shall be excluded.
Notwithstanding the foregoing, for the purpose of Section 4.7 only, there shall be excluded from Consolidated Net Income any income arising from any sale or other disposition of Restricted Investments made by the Company and its Restricted Subsidiaries, any repurchases and redemptions of Restricted Investments made by the Company and its Restricted Subsidiaries, any repayments of loans and advances which constitute Restricted Investments made by the Company and any Restricted Subsidiary, any sale of the stock of an Unrestricted Subsidiary or any distribution or dividend from an Unrestricted Subsidiary, in each case only to the extent such amounts increase the amount of Restricted Payments permitted under clause (d)(3) of the first paragraph of Section 4.7 .
“ Consolidated Total Assets ” means the total consolidated assets of the Company and its Restricted Subsidiaries or Foreign Subsidiaries, as the case may be, in each case as shown on the most recent balance sheet.
“ Contingent Obligations ” means, with respect to any Person, any obligation of such Person guaranteeing any leases, dividends or other obligations that do not constitute Indebtedness (“ primary obligations ”) of any other Person (the “ primary obligor ”) in any manner, whether directly or indirectly, including, without limitation, any obligation of such Person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (A) for the purchase or payment of any such primary obligation or (B) to maintain working capital or equity
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capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, or (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation against loss in respect thereof.
“ Contribution Indebtedness ” means Indebtedness of the Company or any Guarantor in an aggregate principal amount not greater than two times the aggregate amount of cash contributions (other than Excluded Contributions) made to the capital of the Company or such Guarantor after the Issue Date; provided that:
(a) if the aggregate principal amount of such Contribution Indebtedness is greater than one times such cash contribution amount to the capital of the Company or such Guarantor, as applicable, the amount of such excess shall be (i) Subordinated Indebtedness and (ii) Indebtedness with a Stated Maturity later than the Stated Maturity of the Notes, and
(b) such Contribution Indebtedness (i) is incurred within 180 days after the making of such cash contributions and (ii) is so designated as Contribution Indebtedness pursuant to an Officers’ Certificate on the date of the incurrence thereof.
“ Corporate Trust Office of the Trustee ” shall be at the address of the Trustee specified in Section 12.2 hereof or such other address as to which the Trustee shall specify for receipt of notices under this Indenture.
“ Credit Facilities ” means, with respect to the Company or any of its Restricted Subsidiaries, one or more debt facilities, including the ABL Facility and the Term Loan Facility, or other financing arrangements (including, without limitation, commercial paper facilities or indentures) providing for revolving credit loans, term loans, letters of credit or other indebtedness, including any notes, mortgages, guarantees, collateral documents, instruments and agreements executed in connection therewith, and any amendments, supplements, modifications, extensions, renewals, restatements or refunding thereof and any indentures or credit facilities or commercial paper facilities that re-place, refund or refinance any part of the loans, notes, other credit facilities or commitments thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount permitted to be borrowed thereunder or alters the maturity thereof ( provided that such increase in borrowings is permitted under Section 4.9 ) or adds Restricted Subsidiaries as additional borrowers or guarantors thereunder and whether by the same or any other agent, lender or investor or group of lenders or investors
“ Default ” means any event that is, with the passage of time or the giving of notice or both would be, an Event of Default; provided that any Default that results solely from the taking of an action that would have been permitted but for the continuation of a previous Default will be deemed to be cured if such previous Default is cured prior to becoming an Event of Default.
“ Depositary ” means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.3 hereof as the Depositary with respect to the Notes, until a successor shall have been appointed and become such pursuant to Section 2.6 hereof, and, thereafter, “Depositary” shall mean or include such successor.
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“ Designated Noncash Consideration ” means the fair market value of noncash consideration received by the Company or any of its Restricted Subsidiaries in connection with an Asset Sale that is so designated as Designated Noncash Consideration pursuant to an Officers’ 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.
“ Designated Preferred Stock ” means Preferred Stock of the Company or any direct or indirect parent corporation of the Company (other than Disqualified Stock of the Company) that is issued for cash (other than to Holdings or any of its Subsidiaries or an employee stock ownership plan or trust established by the Company or any of its Subsidiaries) and is so designated as Designated Preferred Stock, pursuant to an Officers’ Certificate, on the issuance date thereof, the cash proceeds of which are excluded from the calculation set forth in Section 4.7(3) .
“ Disinterested Director ” means, with respect to any proposed transaction between (i) the Company or a Restricted Subsidiary, as applicable, and (ii) an Affiliate thereof (other than the Company or a Restricted Subsidiary), a member of the Board of Directors of the Company or such Restricted Subsidiary, as applicable, who would not be a party to, or have a financial interest in, such transaction and is not an officer, director or employee of, and does not have a financial interest in, such Affiliate. For purposes of this definition, no person would be deemed not to be a Disinterested Director solely because such person holds Capital Stock in the Company or is an employee of the Company.
“ Disqualified Stock ” means, with respect to any Person, any Capital Stock of such Person which, by its terms (or by the terms of any security into which it is convertible or for which it is putable or exchangeable), or upon the happening of any event, matures or is mandatorily redeemable (other than as a result of a change of control or asset sale), pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof (other than as a result of a change of control or asset sale), in whole or in part, in each case prior to the earlier of the final maturity date of the Notes or the date the Notes are no longer outstanding; provided , however , that if such Capital Stock is issued to any plan for the benefit of employees of the Company or any of its Subsidiaries or by any such plan to such employees, such Capital Stock shall not constitute Disqualified Stock solely because it may be required to be repurchased by the Company or any of its Subsidiaries in order to satisfy applicable statutory or regulatory obligations.
“ Domestic Subsidiary ” means any direct or indirect Subsidiary of the Company that was formed under the laws of the United States, any state of the United States or the District of Columbia.
“ DTC ” means The Depository Trust Company and any successor.
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“ EBITDA ” means, with respect to any Person for any period, the Consolidated Net Income of such Person for such period plus , without duplication,
(a) the provision for taxes based on income or profits, plus franchise or similar taxes, of such Person for such period deducted in computing Consolidated Net Income, plus
(b) Consolidated Interest Expense of such Person for such period to the extent the same was deducted in calculating such Consolidated Net Income, plus
(c) Consolidated Depreciation and Amortization Expense of such Person for such period to the extent such depreciation, amortization and noncash charges were deducted in computing Consolidated Net Income, plus
(d) any expenses or charges incurred in connection with any Equity Offering, Permitted Investment, acquisition, recapitalization or Indebtedness permitted to be incurred under this Indenture (in each case whether or not consummated) or the Transactions and, in each case, deducted in such period in computing Consolidated Net Income, plus
(e) the amount of any restructuring charges or reserves (which, for the avoidance of doubt, shall include retention, severance, systems establishment cost, excess pension charges, contract termination costs, future lease commitments, and costs to consolidate facilities and relocate employees) deducted in such period in computing Consolidated Net Income, plus
(f) any other noncash charges, expenses or losses (including any impairment charges and the impact of purchase accounting, including, but not limited to, the amortization of inventory step-up) reducing Consolidated Net Income for such period (excluding any such charge that represents an accrual or reserve for a cash expenditure for a future period, other than straight-line rent expense determined in accordance with GAAP), plus
(g) the amount of management, monitoring, consulting, advisory fees, termination payments and related expenses paid to the Sponsors (or any accruals relating to such fees and related expenses) during such period pursuant to the Management Agreement, plus
(h) Securitization Fees to the extent deducted in calculating Consolidated Net Income for such period, less
(i) noncash items increasing Consolidated Net Income of such Person for such period (excluding any items which represent the reversal of any accrual of, or cash reserve for, anticipated cash charges made in any prior period or which will result in the receipt of cash in a future period or the amortization of lease incentives).
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Notwithstanding the foregoing, the provision for taxes based on the income or profits of, and the depreciation and amortization and noncash charges of, a Restricted Subsidiary (other than a Guarantor) shall be added to Consolidated Net Income to compute EBITDA only to the extent (and in the same proportion, including by reason of minority interests) that the net income or loss of such Restricted Subsidiary was included in calculating Consolidated Net Income and only if a corresponding amount would be permitted at the date of determination to be dividended to the Company by such Restricted Subsidiary without any prior governmental approval (which has not been obtained) or would not be restricted from being so dividended, directly or indirectly, by the operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule, or governmental regulation applicable to that Restricted Subsidiary or its stockholders, unless such restriction with respect to the payment of dividends or in similar distributions has been legally waived.
“ Equity Interests ” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock).
“ Equity Offering ” means any public or private sale of Common Stock or Preferred Stock of the Company or any of its direct or indirect parent corporations (excluding Disqualified Stock of such entity), other than (i) public offerings with respect to Common Stock of the Company or of any of its direct or indirect parent corporations registered on Form S-4 or Form S-8, (ii) any such public or private sale that constitutes an Excluded Contribution or (iii) an issuance to any Subsidiary of the Company.
“ Exchange Act ” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder.
“ Exchange Notes ” means the series of Notes to be issued under this Indenture in exchange for the Initial Notes pursuant to a Registration Rights Agreement.
“ Exchange Offer ” has the meaning set forth in the Registration Rights Agreement.
“ Exchange Offer Registration Statement ” has the meaning set forth in the Registration Rights Agreement.
“ Excluded Contribution ” means net cash proceeds, marketable securities or Qualified Proceeds, in each case received by the Company and its Restricted Subsidiaries from:
(a) contributions to its common equity capital; and
(b) the sale (other than to a Subsidiary or to any management equity plan or stock option plan or any other management or employee benefit plan or agreement of the Company or any Subsidiary) of Capital Stock (other than Disqualified Stock and Designated Preferred Stock),
in each case designated as Excluded Contributions pursuant to an Officers’ Certificate on the date such capital contributions are made or the date such Equity Interests are sold, as the case
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may be, which are excluded from the calculation set forth in clause (d)(3) of the first paragraph of Section 4.7 .
“ Expiration Date ” has the meaning set forth in the definition of “Offer to Purchase.”
“ Fixed Charge Coverage Ratio ” means, with respect to any Person for any period consisting of such Person and its Restricted Subsidiaries’ most recently ended four fiscal quarters for which internal financial statements are available, the ratio of EBITDA of such Person for such period to the Fixed Charges of such Person for such period. In the event that the Company or any Restricted Subsidiary incurs, assumes, guarantees or repays any Indebtedness or issues or redeems Disqualified Stock or Preferred Stock, in each case, subsequent to the commencement of the period for which the Fixed Charge Coverage Ratio is being calculated but prior to the event for which the calculation of the Fixed Charge Coverage Ratio is made (the “ Calculation Date ”), then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect to such incurrence, assumption, guarantee or repayment of Indebtedness, or such issuance or redemption of Disqualified Stock or Preferred Stock, as if the same had occurred at the beginning of the Applicable Four-Quarter Period and as if the Company or Restricted Subsidiary had not earned the interest income actually earned during such period in respect of such cash used to repay, repurchase, defease or otherwise discharge such Indebtedness.
If Investments, acquisitions, dispositions, mergers or consolidations have been made by the Company or any Restricted Subsidiary during the four-quarter reference period or subsequent to such reference period and on or prior to or simultaneously with the Calculation Date, then the Fixed Charge Coverage Ratio shall be calculated on a pro forma basis assuming that all such Investments, acquisitions, dispositions, mergers or consolidations (and the change in any associated Fixed Charge obligations and the change in EBITDA resulting therefrom) had occurred on the first day of the four-quarter reference period.
If since the beginning of such period any Person (that subsequently became a Restricted Subsidiary or was merged with or into the Company or any Restricted Subsidiary since the beginning of such period) shall have made any Investment, acquisition, disposition, merger or consolidation that would have required adjustment pursuant to this definition, then the Fixed Charge Coverage Ratio shall be calculated giving pro forma effect thereto for such period as if such Investment, acquisition, disposition, merger or consolidation had occurred at the beginning of the Applicable Four-Quarter Period.
For purposes of this definition, whenever pro forma effect is to be given to an Investment, acquisition, disposition, merger or consolidation and the amount of income or earnings relating thereto, the pro forma calculations shall be determined in good faith by a responsible financial or accounting officer of the Company and shall comply with the requirements of Rule 11-02 of Regulation S-X promulgated by the Commission, except that such pro forma calculations may include operating expense reductions for such period resulting from the transaction that is being given pro forma effect that (A) have been realized or (B) for which the steps necessary for realization have been taken (or are taken concurrently with such transaction) or (C) for which the steps necessary for realization are reasonably expected to be taken within the twelve-month period following such transaction and, in each case, including, but not limited to, (a) reduction in personnel expenses, (b) reduction of costs related to
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administrative functions, (c) reduction of costs related to leased or owned properties and (d) reductions from the consolidation of operations and streamlining of corporate overhead, provided that, in each case, such adjustments are set forth in an Officers’ Certificate signed by the Company’s chief financial officer and another Officer which states (i) the amount of such adjustment or adjustments, (ii) in the case of items (B) or (C) above, that such adjustment or adjustments are based on the reasonable good faith beliefs of the Officers executing such Officers’ Certificate at the time of such execution and (iii) that any related incurrence of Indebtedness is permitted pursuant to this Indenture. If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest on such Indebtedness shall be calculated as if the rate in effect on the Calculation Date had been the applicable rate for the entire period (taking into account any Hedging Obligations applicable to such Indebtedness if the related hedge has a remaining term in excess of twelve months).
Interest on a Capitalized Lease Obligation shall be deemed to accrue at the interest rate reasonably determined by a responsible financial or accounting officer of the Company to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with GAAP. For purposes of making the computation referred to above, interest on any Indebtedness under a revolving credit facility computed on a pro forma basis shall be computed based upon the average daily balance of such Indebtedness during the applicable period. Interest on Indebtedness that 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 rate, shall be deemed to have been based upon the rate actually chosen, or, if none, then based upon such optional rate chosen as the Company may designate.
“ Fixed Charges ” means, with respect to any Person for any period, the sum of, without duplication, (a) Consolidated Interest Expense (excluding all noncash interest expense and amortization/accretion of original issue discount (including any original issue discount created by fair value adjustments to Indebtedness in existence as of the Issue Date as a result of purchase accounting)) of such Person for such period, (b) all cash dividends paid during such period (excluding items eliminated in consolidation) on any series of Preferred Stock of such Person and its Subsidiaries and (c) all cash dividends paid during such period (excluding items eliminated in consolidation) on any series of Disqualified Stock of such Person and its Subsidiaries.
“ Foreign Subsidiary ” means any Restricted Subsidiary of the Company that is not a Domestic Subsidiary.
“ GAAP ” means generally accepted accounting principles in the United States in effect on the date hereof. For purposes of this Indenture, the term “ consolidated ” with respect to any Person means such Person consolidated with its Restricted Subsidiaries and does not include any Unrestricted Subsidiary.
“ Global Note Legend ” means the legend identified as such in Exhibit A hereto.
“ Global Notes ” means the Notes that are in the form of Exhibit A hereto issued in global form and registered in the name of the Depositary or its nominee.
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“ Government Securities ” means (1) any security which is (a) a direct obligation of the United States of America for the payment of which the full faith and credit of the United States of America is pledged or (b) an obligation of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the payment of which is unconditionally guaranteed as a full faith and credit obligation of the United States of America, which, in either case, is not callable or redeemable at the option of the issuer thereof, and (2) any depository receipt issued by a bank, as defined in the Securities Act, as custodian with respect to any Government Securities and held by such bank for the account of the holder of such depository receipt, or with respect to any specific payment of principal of or interest on any Government Securities which is so specified and held, provided that, except as required by law, such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Securities or the specific payment of principal or interest evidenced by such depository receipt.
“ guarantee ” means a guarantee other than by endorsement of negotiable instruments for collection in the ordinary course of business, direct or indirect, in any manner including, without limitation, through letters of credit or reimbursement agreements in respect thereof, of all or any part of any Indebtedness or other obligations. When used as a verb, “ guarantee ” shall have a corresponding meaning.
“ Guarantee ” means any guarantee of the obligations of the Company under this Indenture and the Notes by a Guarantor in accordance with the provisions of this Indenture. When used as a verb, “ Guarantee ” shall have a corresponding meaning.
“ Guarantor ” means any Person that incurs a Guarantee of the Notes; provided that upon the release and discharge of such Person from its Guarantee in accordance with this Indenture, such Person shall cease to be a Guarantor. On the Issue Date, the Guarantors will be each Domestic Subsidiary of the Company that is a Restricted Subsidiary, a guarantor under the Term Loan Facility and a borrower or guarantor under the ABL Facility.
“ Hedging Obligations ” means, with respect to any Person, the obligations of such Person under:
(a) currency exchange, interest rate or commodity swap agreements, currency exchange, interest rate or commodity cap agreements and currency exchange, interest rate or commodity collar agreements; and
(b) other agreements or arrangements designed to manage, hedge or protect such Person with respect to fluctuations in currency exchange, interest rates or commodity prices.
“ Holder ” means a Person in whose name a Note is registered in the security register.
“ Holdings ” means Burlington Coat Factory Investments Holdings, Inc.
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“ Indebtedness ” means, with respect to any Person,
(a) any indebtedness (including principal and premium) of such Person, whether or not contingent:
(i) in respect of borrowed money,
(ii) evidenced by bonds, notes, debentures or similar instruments or letters of credit (or, without duplication, reimbursement agreements in respect thereof),
(iii) representing the deferred and unpaid balance of the purchase price of any property (including Capitalized Lease Obligations), except any such balance that constitutes a trade payable or similar obligation to a trade creditor in each case accrued in the ordinary course of business, or
(iv) representing any interest rate Hedging Obligations,
if and to the extent that any of the foregoing Indebtedness (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet (excluding the footnotes thereto) of such Person prepared in accordance with GAAP,
(b) Disqualified Stock of such Person,
(c) to the extent not otherwise included, any obligation by such Person to be liable for, or to pay, as obligor, guarantor or otherwise, the Indebtedness of another Person (other than by endorsement of negotiable instruments for collection in the ordinary course of business), and
(d) to the extent not otherwise included, Indebtedness of another Person secured by a Lien on any asset (other than a Lien on Capital Stock of an Unrestricted Subsidiary) owned by such Person (whether or not such Indebtedness is assumed by such Person);
provided , however , (A) that Contingent Obligations incurred in the ordinary course of business and not in respect of borrowed money and documentary letters of credit issued in connection with inventory purchases in the ordinary course of business and (B) items that would appear as a liability on a balance sheet prepared in accordance with GAAP as a result of the application of EITF 97-10, “The Effect of Lessee Involvement in Asset Construction,” shall be deemed not to constitute Indebtedness.
“ Indenture ” means this Indenture, as amended or supplemented from time to time.
“ Independent Financial Advisor ” means an accounting, appraisal or investment banking firm or consultant to Persons engaged in a Permitted Business of nationally recognized standing that is, in the good faith judgment of the Board of Directors of the Company, qualified to perform the task for which it has been engaged.
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“ Initial Notes ” has the meaning set forth in the preamble hereto.
“ Investments ” means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates) in the forms of loans (including guarantees or other obligations), advances or capital contributions (including by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others, but excluding accounts receivable, trade credit, advances to customers, commission, travel and similar advances to officers and employees, in each case made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities issued by any other Person and investments that are required by GAAP to be classified on the balance sheet (excluding the footnotes) of such Person in the same manner as the other investments included in this definition to the extent such transactions involve the transfer of cash or other property. If the Company or any Subsidiary of the Company sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary of the Company such that, after giving effect to any such sale or disposition, such Person is no longer a Subsidiary of the Company, the Company will be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Equity Interests of such Subsidiary not sold or disposed of in an amount determined as provided in the third paragraph of Section 4.7 .
For purposes of the definition of “Unrestricted Subsidiary” and Section 4.7 , (i) “Investments” shall include the portion (proportionate to the Company’s equity interest in such Subsidiary) of the fair market value of the net assets of a Subsidiary of the Company at the time that such Subsidiary is designated an Unrestricted Subsidiary; provided , however , that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Company shall be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary in an amount (if positive) equal to (x) the Company’s “Investment” in such Subsidiary at the time of such redesignation less (y) the portion (proportionate to the Company’s equity interest in such Subsidiary) of the fair market value of the net assets of such Subsidiary at the time of such redesignation; (ii) any property transferred to or from an Unrestricted Subsidiary shall be valued at its fair market value at the time of such transfer, in each case as determined in good faith by the Board of Directors of the Company, and (iii) any transfer of Capital Stock that results in an entity which became a Restricted Subsidiary after the Issue Date ceasing to be a Restricted Subsidiary shall be deemed to be an Investment in an amount equal to the fair market value (as determined by the Board of Directors of the Company in good faith as of the date of initial acquisition) of the Capital Stock of such entity owned by the Company and its Restricted Subsidiaries immediately after such transfer.
“ Issue Date ” means February 24, 2011.
“ Legal Holiday ” means a Saturday, a Sunday or a day on which banking institutions in the City of New York, the city in which the principal Corporate Trust Office of the Trustee is located or at a place of payment are authorized by law, regulation or executive order to remain closed. If a payment date is a Legal Holiday, payment shall be made at that place on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period.
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“ Lien ” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction; provided that in no event shall an operating lease be deemed to constitute a Lien.
“ Management Agreement ” means the Advisory Agreement dated as of April 13, 2006, by and among Parent, the Company and the Sponsors, as in effect on the Issue Date or otherwise amended, modified or supplemented.
“ Moody’s ” means Moody’s Investors Service, Inc. and any successor to its rating business.
“ Net Income ” means, with respect to any Person, the net income (loss) of such Person, determined in accordance with GAAP and before any reduction in respect of Preferred Stock dividends or accretion of any Preferred Stock.
“ Net Proceeds ” means the aggregate cash proceeds received by the Company or any Restricted Subsidiary in respect of any Asset Sale, in each case net of legal, accounting and investment banking fees, and brokerage and sales commissions, any relocation expenses incurred as a result thereof, taxes paid or payable as a result thereof (after taking into account any available tax credits or deductions and any tax sharing arrangements), repayment of Indebtedness (including any required premiums or prepayment penalties) that is secured by the property or assets that are the subject of such Asset Sale and any deduction of appropriate amounts to be provided by the Company as a reserve in accordance with GAAP against any liabilities associated with the asset disposed of in such transaction and retained by the Company after such sale or other disposition thereof, including, without limitation, pension and other post-employment benefit liabilities and liabilities related to environmental matters or against any indemnification obligations associated with such transaction.
“ Note Custodian ” means the Trustee when serving as custodian for the Depositary with respect to the Global Notes, or any successor entity thereto.
“ Notes ” means the 10.000% Senior Notes due 2019 of the Company issued on the date hereof and any Additional Notes, including any Exchange Notes. The Notes and the Additional Notes (including any Exchange Notes), if any, shall be treated as a single class for all purposes under this Indenture.
“ Obligations ” means any principal, interest, penalties, fees, indemnifications, reimbursements (including, without limitation, reimbursement obligations with respect to letters of credit), damages and other liabilities, and guarantees of payment of such principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities, payable under the documentation governing any Indebtedness.
“ Offer ” has the meaning set forth in the definition of “Offer to Purchase.”
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“ Offer to Purchase ” means a written offer (the “ Offer ”) sent by the Company by first class mail, postage prepaid, to each Holder at his address appearing in the security register on the date of the Offer, offering to purchase up to the aggregate principal amount of Notes set forth in such Offer at the purchase price set forth in such Offer (as determined pursuant to this Indenture). Unless otherwise required by applicable law, the Offer shall specify an expiration date (the “ Expiration Date ”) of the Offer to Purchase which shall be, subject to any contrary requirements of applicable law, not less than 30 days or more than 60 days after the date of mailing of such Offer and a settlement date (the “ Purchase Date ”) for purchase of Notes within five business days after the Expiration Date. The Company shall notify the Trustee at least 15 days (or such shorter period as is acceptable to the Trustee) prior to the mailing of the Offer of the Company’s obligation to make an Offer to Purchase, and the Offer shall be mailed by the Company or, at the Company’s request, by the Trustee in the name and at the expense of the Company. The Offer shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Offer to Purchase. The Offer shall also state:
(1) the Section of this Indenture pursuant to which the Offer to Purchase is being made;
(2) the Expiration Date and the Purchase Date;
(3) the aggregate principal amount of the outstanding Notes offered to be purchased pursuant to the Offer to Purchase (including, if less than 100%, the manner by which such amount has been determined pursuant to Indenture covenants requiring the Offer to Purchase) (the “ Purchase Amount ”);
(4) the purchase price to be paid by the Company for each $1,000 principal amount of Notes accepted for payment (as specified pursuant to this Indenture) (the “ Purchase Price ”);
(5) that the Holder may tender all or any portion of the Notes registered in the name of such Holder and that any portion of a Note tendered must be tendered in an integral multiple of $1,000 principal amount;
(6) the place or places where Notes are to be surrendered for tender pursuant to the Offer to Purchase, if applicable;
(7) that, unless the Company defaults in making such purchase, any Note accepted for purchase pursuant to the Offer to Purchase will cease to accrue interest on and after the Purchase Date, but that any Note not tendered or tendered but not purchased by the Company pursuant to the Offer to Purchase will continue to accrue interest at the same rate;
(8) that, on the Purchase Date, the Purchase Price will become due and payable upon each Note accepted for payment pursuant to the Offer to Purchase;
(9) that each Holder electing to tender a Note pursuant to the Offer to Purchase will be required to surrender such Note or cause such Note to be surrendered at
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the place or places set forth in the Offer prior to the close of business on the Expiration Date (such Note being, if the Company or the Trustee so requires, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or his attorney duly authorized in writing);
(10) that Holders will be entitled to withdraw all or any portion of Notes tendered if the Company (or its Paying Agent) receives, not later than the close of business on the Expiration Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the aggregate principal amount of the Notes the Holder tendered, the certificate number of the Note the Holder tendered and a statement that such Holder is withdrawing all or a portion of his tender;
(11) that (a) if Notes having an aggregate principal amount less than or equal to the Purchase Amount are duly tendered and not withdrawn pursuant to the Offer to Purchase, the Company shall purchase all such Notes and (b) if Notes having an aggregate principal amount in excess of the Purchase Amount are tendered and not withdrawn pursuant to the Offer to Purchase, the Company shall purchase Notes having an aggregate principal amount equal to the Purchase Amount on a pro rata basis (with such adjustments as may be deemed appropriate so that only Notes in denominations of $1,000 principal amount or integral multiples thereof shall be purchased); and
(12) if applicable, that, in the case of any Holder whose Note is purchased only in part, the Company shall execute, and the Trustee shall authenticate and deliver to the Holder of such Note without service charge, a new Note or Notes, of any authorized denomination as requested by such Holder, in the aggregate principal amount equal to and in exchange for the unpurchased portion of the aggregate principal amount of the Notes so tendered.
“ Offering Circular ” means the final offering circular related to the issuance of the Notes on the Issue Date, dated February 17, 2011.
“ Officer ” means the Chairman of the Board, the Chief Executive Officer, the President, any Executive Vice President, Senior Vice President or Vice President, the Treasurer or the Secretary of the Company.
“ Officers’ Certificate ” means a certificate signed on behalf of the Company, by two Officers of the Company, one of whom is the principal executive officer, the principal financial officer, the Treasurer or the principal accounting officer of the Company, that meets the requirements set forth in this Indenture.
“ Opinion of Counsel ” means an opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company or any Subsidiary of the Company.
“ Parent ” means Burlington Coat Factory Holdings, Inc.
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“ Participant ” means, with respect to DTC, a Person who has an account with DTC.
“ Paying Agent ” means any Person authorized by the Company to pay the principal of, premium, if any, or interest on any Notes on behalf of the Company.
“ Permitted Business ” means the business and any services, activities or businesses incidental, or directly related or similar to, any line of business engaged in by the Company and its Subsidiaries as of the Issue Date or any business activity that is a reasonable extension, development or expansion thereof or ancillary thereto.
“ Permitted Debt ” has the meaning given in Section 4.9 .
“ Permitted Holders ” means (i) each of the Sponsors and their respective Affiliates, (ii) Officers, provided that if such Officers beneficially own more shares of Voting Stock of either of the Company or any of its direct or indirect parent entities than the number of such shares beneficially owned by all the Officers as of the Issue Date, such excess shall be deemed not to be beneficially owned by Permitted Holders, and (iii) any “group” (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) of which any of the foregoing are members, provided that in the case of such “group” and without giving effect to the existence of such “group” or any other “group,” such Sponsors, Affiliates and Officers (subject, in the case of Officers, to the foregoing limitation), collectively, have beneficial ownership, directly or indirectly, of more than 50% of the total voting power of the Voting Stock of the Company or any of its direct or indirect parent entities held by such “group.”
“ Permitted Investments ” means
(1) any Investment by the Company in any Restricted Subsidiary or by a Restricted Subsidiary in the Company or another Restricted Subsidiary;
(2) any Investment in cash and Cash Equivalents;
(3) any Investment by the Company or any Restricted Subsidiary in a Person that is engaged in a Permitted Business if as a result of such Investment (A) such Person becomes a Restricted Subsidiary or (B) such Person, in one transaction or a series of related transactions, is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or a Restricted Subsidiary;
(4) any Investment in securities or other assets not constituting cash or Cash Equivalents and received in connection with an Asset Sale made pursuant Section 3.9 or any other disposition of assets not constituting an Asset Sale;
(5) any Investment existing on the Issue Date and any modification, replacement, renewal or extension thereof; provided that the amount of any such Investment may be increased (x) as required by the terms of such Investment as in existence on the Issue Date or (y) as otherwise permitted under this Indenture;
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(6) loans and advances to employees and any guarantees made in the ordinary course of business, but in any event not in excess of $10.0 million in the aggregate outstanding at any one time;
(7) any Investment acquired by the Company or any Restricted Subsidiary (A) in exchange for any other Investment or accounts receivable held by the Company or Restricted Subsidiary in connection with or as a result of a bankruptcy, workout, reorganization or recapitalization of the issuer of such other Investment or accounts receivable or (B) as a result of a foreclosure by the Company or Restricted Subsidiary with respect to any secured Investment or other transfer of title with respect to any secured Investment in default;
(8) Hedging Obligations permitted under clause (9) of the definition of “Permitted Debt”;
(9) loans and advances to officers, directors and employees for business-related travel expenses, moving expenses and other similar expenses, in each case incurred in the ordinary course of business;
(10) any Investment by the Company or a Restricted Subsidiary having an aggregate fair market value, taken together with all other Investments made pursuant to this clause (10) that are at that time outstanding (without giving effect to the sale of an Unrestricted Subsidiary to the extent the proceeds of such sale do not consist of cash and/or marketable securities), not to exceed the greater of $50.0 million and an amount equal to 1.5% of Consolidated Total Assets (with the fair market value of each Investment being measured at the time made and without giving effect to subsequent changes in value); provided that if such Investment is in Capital Stock of a Person that subsequently becomes a Restricted Subsidiary, such Investment shall thereafter be deemed permitted under clause (1) above and shall not be included as having been made pursuant to this clause (10);
(11) Investments the payment for which consists of Equity Interests of the Company or any of its direct or indirect parent corporations (exclusive of Disqualified Stock);
(12) guarantees (including Guarantees) of Indebtedness permitted under Section 4.9 and performance guarantees and consistent with past practice;
(13) Investments consisting of licensing of intellectual property pursuant to joint marketing arrangements with other Persons;
(14) any Investment in a Securitization Subsidiary or any Investment by a Securitization Subsidiary in any other Person in connection with a Qualified Securitization Financing, including, without limitation, Investments of funds held in accounts permitted or required by the arrangements governing such Qualified Securitization Financing or any related Indebtedness; provided, however , that any Investment in a Securitization Subsidiary is in the form of a Purchase Money Note, contribution of additional Securitization Assets or an equity interest;
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(15) Investments consisting of earnest money deposits required in connection with a purchase agreement or other acquisition; and
(16) Investments in Unrestricted Subsidiaries in an amount at any time outstanding not to exceed $30.0 million.
“ Permitted Liens ” means the following types of Liens:
(a) Liens securing Indebtedness subordinated to the Notes or the Guarantees, so long as the Notes and the Guarantees are secured by a Lien on such property, assets or proceeds that is senior in priority to such Liens;
(b) Liens so long as the Notes and the Guarantees are equally and ratably secured;
(c) Liens existing on the Issue Date to the extent and in the manner such Liens are in effect on the Issue Date;
(d)(1) Liens securing the Notes and the Guarantees and any Notes issued in exchange therefor pursuant to the Registration Rights Agreement (including Notes issued in exchange for Additional Notes), (2) Liens securing Indebtedness permitted to be incurred pursuant to clauses (1) and (11) of the definition of “Permitted Debt” and (3) Liens securing Indebtedness that, at the time of incurrence does not exceed the maximum principal amount of Indebtedness that, as of such date, and after giving effect to the incurrence of such Indebtedness and the application of the proceeds therefrom on such date, would not cause the Secured Indebtedness Leverage Ratio of the Company to exceed 3.50 to 1.0;
(e) deposits of cash or government bonds made in the ordinary course of business to secure surety or appeal bonds to which such Person is a party;
(f) Liens in favor of issuers of performance, surety, bid, indemnity, warranty, release, appeal or similar bonds or with respect to other regulatory requirements or letters of credit or bankers’ acceptance issued, and completion guarantees provided for, in each case pursuant to the request of and for the account of such Person in the ordinary course of its business or consistent with past practice;
(g) Liens on property or shares of stock of a Person at the time such Person becomes a Subsidiary; provided , however , that such Liens are not created or incurred in connection with, or in contemplation of, or to provide all or any portion of the funds or credit support utilized in connection with, such other Person becoming such a Subsidiary; provided , further , however , that such Liens may not extend to any other property owned by the Company or any of its Restricted Subsidiaries;
(h) Liens on property at the time the Company or a Restricted Subsidiary acquired the property, including any acquisition by means of a merger or consolidation with or into the Company or any of its Restricted Subsidiaries; provided , however , that
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such Liens are not created or incurred in connection with, or in contemplation of, or to provide all or any portion of the funds or credit support utilized for, such acquisition; provided , further , however , that such Liens may not extend to any other property owned by the Company or any Restricted Subsidiary;
(i) Liens securing Hedging Obligations so long as the related Indebtedness is permitted to be incurred under this Indenture and is secured by a Lien on the same property securing such Hedging Obligation;
(j) Liens on specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances or letters of credit issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(k) Liens in favor of the Company or any Restricted Subsidiary;
(l) Liens to secure any Indebtedness that is incurred to refinance any Indebtedness that has been secured by a Lien existing on the Issue Date or referred to in clauses (c), (d) and (w)(B) of this definition; provided , however , that such Liens (x) are no less favorable to the holders of the Notes, taken as a whole, and are not more favorable to the lienholders with respect to such Liens than the Liens in respect of the Indebtedness being refinanced; and (y) do not extend to or cover any property or assets of the Company or any of its Restricted Subsidiaries not securing the Indebtedness so refinanced;
(m) Liens on Securitization Assets and related assets of the type specified in the definition of “Securitization Financing” incurred in connection with any Qualified Securitization Financing incurred pursuant to clause (17) of the definition of “Permitted Debt”;
(n) Liens for taxes, assessments or other governmental charges or levies not yet delinquent or the failure to pay which would not result in a material adverse effect, or which are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted or for property taxes on property that the Company or one of its Subsidiaries has determined to abandon if the sole recourse for such tax, assessment, charge, levy or claim is to such property;
(o) judgment liens in respect of judgments that do not constitute an Event of Default;
(p) pledges, deposits or security under workmen’s compensation, unemployment insurance and other social security laws or regulations, or deposits to secure the performance of tenders, contracts (other than for the payment of Indebtedness) or leases, or deposits to secure public or statutory obligations, or deposits as security for contested taxes or import or customs duties or for the payment of rent, or deposits or other security securing liabilities to insurance carriers under insurance or self-insurance arrangements or earnest money deposits required in connection with a purchase
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agreement or other acquisition, in each case incurred in the ordinary course of business or consistent with past practice;
(q) carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by applicable law, (i) arising in the ordinary course of business and securing obligations that are not overdue by more than sixty (60) days, (ii) (A) that are being contested in good faith by appropriate proceedings, (B) the Company or a Restricted Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (C) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation. or (iii) the existence of which would not reasonably be expected to result in a material adverse effect;
(r) encumbrances, ground leases, easements or reservations of, or rights of others for, licenses, rights of way, sewers, electric lines, telegraph and telephone lines and other similar purposes, or zoning, building codes or other restrictions (including, without limitation, minor defects or irregularities in title and similar encumbrances) as to the use of real properties or Liens incidental to the conduct of business or to the ownership of properties that do not in the aggregate materially adversely affect the value of said properties or materially impair their use in the operation of the business;
(s) leases, licenses, subleases or sublicenses granted to others in the ordinary course of business that do not (x) interfere in any material respect with the business of the Company or any of its material Restricted Subsidiaries or (y) secure any Indebtedness;
(t) the rights reserved or vested in any Person by the terms of any lease, license, franchise, grant or permit held by the Company or any of its Restricted Subsidiaries or by a statutory provision, to terminate any such lease, license, franchise, grant or permit, or to require annual or periodic payments as a condition to the continuance thereof;
(u) banker’s Liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a depositary institution;
(v) Liens arising from Uniform Commercial Code financing statement filings regarding operating leases or consignments entered into by the Company and its Restricted Subsidiaries in the ordinary course of business;
(w)(A) other Liens securing Indebtedness for borrowed money or other obligations with respect to property or assets with an aggregate fair market value (valued at the time of creation thereof) of not more than $25.0 million at any time and (B) Liens securing Indebtedness incurred to finance the construction, purchase or lease of, or repairs, improvements or additions to, property of such Person; provided , however , that (x) the Lien may not extend to any other property (except for accessions to such property) owned by such Person or any of its Restricted Subsidiaries at the time the Lien is incurred, (y) such Liens attach concurrently with or within 270 days after the acquisition, repair, replacement, construction or improvement (as applicable) of the property subject
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to such Liens and (z) with respect to Capitalized Lease Obligations, such Liens do not at any time extend to or cover any assets (except for accessions to such assets) other than the assets subject to such Capitalized Lease Obligations; provided that individual financings of property provided by one lender may be cross-collateralized to other financings of equipment provided by such lender;
(x) Liens (i) of a collection bank arising under Section 4-210 of the Uniform Commercial Code on items in the course of collection, (ii) attaching to commodity trading accounts or other commodities brokerage accounts incurred in the ordinary course of business; and (iii) in favor of a banking institution arising as a matter of law encumbering deposits (including the right of set-off) and which are within the general parameters customary in the banking industry;
(y) Liens encumbering reasonable customary initial deposits and margin deposits and similar Liens attaching to commodity trading accounts or other brokerage accounts incurred in the ordinary course of business and not for speculative purposes;
(z) Liens that are contractual rights of set-off (i) relating to the establishment of depository relations with banks not given in connection with the issuance of Indebtedness, (ii) relating to pooled deposit or sweep accounts of the Company or any Restricted Subsidiary to permit satisfaction of overdraft or similar obligations incurred in the ordinary course of business of the Company and its Restricted Subsidiaries or (iii) relating to purchase orders and other agreements entered into by the Company or any Restricted Subsidiary in the ordinary course of business;
(aa) Liens solely on any cash earnest money deposits made by the Company or any of its Restricted Subsidiaries in connection with any letter of intent or purchase agreement permitted under this Indenture;
(bb) Liens with respect to the assets of a Restricted Subsidiary that is not a Guarantor securing Indebtedness of such Restricted Subsidiary incurred in accordance with Section 4.9 ;
(cc) Liens to secure Indebtedness incurred pursuant to clauses (20) and (21) of the definition of “Permitted Debt”;
(dd) Liens arising by operation of law under Article 2 of the Uniform Commercial Code in favor of a reclaiming seller of goods or buyer of goods;
(ee) security given to a public or private utility or any governmental authority as required in the ordinary course of business;
(ff) landlords’ and lessors’ Liens in respect of rent not in default for more than sixty days or the existence of which, individually or in the aggregate, would not reasonably be expected to result in a material adverse effect;
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(gg) Liens in favor of customs and revenue authorities imposed by applicable law arising in the ordinary course of business in connection with the importation of goods and securing obligations (i) that are not overdue by more than sixty (60) days, (ii) (A) that are being contested in good faith by appropriate proceedings, (B) the Company or Restricted Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (C) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (iii) the existence of which would not reasonably be expected to result in a material adverse effect;
(hh) Liens on securities which are the subject of repurchase agreements incurred in the ordinary course of business; and
(ii) Liens on the Capital Stock of Unrestricted Subsidiaries.
“ Person ” means any individual, corporation, partnership, joint venture, association, joint stock company, trust, unincorporated organization, limited liability company or government or other entity.
“ Preferred Stock ” means any Equity Interest with preferential rights of payment of dividends upon liquidation, dissolution or winding up.
“ Purchase Amount ” has the meaning set forth in the definition of “Offer to Purchase.”
“ Purchase Date ” has the meaning set forth in the definition of “Offer to Purchase.”
“ Purchase Money Note ” means a promissory note of a Securitization Subsidiary evidencing a line of credit, which may be irrevocable, issued by the Company or any Subsidiary of the Company to such Securitization Subsidiary in connection with a Qualified Securitization Financing, which note is intended to finance that portion of the purchase price that is not paid in cash or a contribution of equity and which (a) shall be repaid from cash available to the Securitization Subsidiary, other than (i) amounts required to be established as reserves, (ii) amounts paid to investors in respect of interest, (iii) principal and other amounts owing to such investors and (iv) amounts paid in connection with the purchase of newly generated receivables, and (b) may be subordinated to the payments described in clause (a).
“ Purchase Price ” has the meaning set forth in the definition of “Offer to Purchase.”
“ Qualified Proceeds ” means assets that are used or useful in, or Capital Stock of any Person engaged in, a Permitted Business; provided that the fair market value of any such assets or Capital Stock shall be determined by the Board of Directors of the Company in good faith.
“ Qualified Securitization Financing ” means any Securitization Financing of a Securitization Subsidiary that meets the following conditions: (i) the Board of Directors of the Company shall have determined in good faith that such Qualified Securitization Financing (including financing terms, covenants, termination events and other provisions) is in the aggregate economically fair and reasonable to the Company and the Securitization Subsidiary,
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(ii) all sales of Securitization Assets and related assets to the Securitization Subsidiary are made at fair market value (as determined in good faith by the Company) and (iii) the financing terms, covenants, termination events and other provisions thereof shall be market terms (as determined in good faith by the Company) and may include Standard Securitization Undertakings. The grant of a security interest in any Securitization Assets of the Company or any of its Restricted Subsidiaries (other than a Securitization Subsidiary) to secure Indebtedness under a Credit Facility and any Refinancing Indebtedness with respect thereto shall not be deemed a Qualified Securitization Financing.
“ Rating Agencies ” means S&P and Moody’s; provided , that if either S&P or Moody’s (or both) shall cease issuing a rating on the Notes for reasons outside the control of the Company, the Company may select a nationally recognized statistical rating agency to substitute for S&P or Moody’s (or both).
“ Redemption Price ,” when used with respect to any Note to be redeemed, means the price at which it is to be redeemed pursuant to this Indenture.
“ Registration Rights Agreement ” means the Registration Rights Agreement dated as of the Issue Date between the Company, the Guarantors and Goldman, Sachs & Co., as representative of the initial purchasers, relating to the Notes.
“ Resale Restriction Termination Date ” means for any Transfer Restricted Note (or beneficial interest therein), other than a Regulation S Temporary Global Note, which shall not have a Resale Restriction Termination Date and shall remain subject to the transfer restrictions specified therefor in this Indenture until such Global Note is cancelled by the Trustee, that is (a) not a Regulation S Global Note (or Certificated Note issued in respect thereof pursuant to Section 2.6(b) ), one year (or such other period specified in Rule 144) from the Issue Date or, if any Additional Notes that are Transfer Restricted Notes have been issued before the Resale Restriction Termination Date for any Transfer Restricted Notes, from the latest such original issue date of such Additional Notes, and (b) a Regulation S Global Note (or Certificated Note issued in respect thereof pursuant to Section 2.6(b) ) (other than a Regulation S Temporary Global Note), the date on or after the 40th consecutive day beginning on and including the later of (i) the day on which any Notes represented thereby are offered to persons other than distributors (as defined in Regulation S) pursuant to Regulation S and (ii) the issue date for such Notes.
“ Responsible Officer ” means, when used with respect to the Trustee, any officer assigned to the Corporate Trust Office of the Trustee, including any vice president, assistant vice president, assistant treasurer, or any other officer of the Trustee customarily performing functions similar to those performed by any of the above designated officers and having direct responsibility for the administration of this Indenture, and also, with respect to a particular matter, any other officer to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject.
“ Restricted Investment ” means an Investment other than a Permitted Investment.
“ Restricted Notes Legend ” means the legend identified as such in Exhibit A hereto.
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“ Restricted Payment ” means as defined in Section 4.7 .
“ Restricted Subsidiary ” means, at any time, any direct or indirect Subsidiary of the Company (including any Foreign Subsidiary) that is not then an Unrestricted Subsidiary; provided , however , that upon the occurrence of an Unrestricted Subsidiary ceasing to be an Unrestricted Subsidiary, such Subsidiary shall be included in the definition of Restricted Subsidiary.
“ S&P ” means Standard and Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and any successor to its rating business.
“ Secured Indebtedness ” means any Indebtedness secured by a Lien permitted to be incurred by this Indenture.
“ Secured Indebtedness Leverage Ratio ” means, with respect to any Person, at any date the ratio of (i) Secured Indebtedness of such Person and its Restricted Subsidiaries as of such date of calculation (determined on a consolidated basis in accordance with GAAP) to (ii) EBITDA of such Person for the four full fiscal quarters for which internal financial statements are available immediately preceding such date on which such additional Indebtedness is incurred. In the event that the Company or any of its Restricted Subsidiaries incurs or redeems any Indebtedness subsequent to the commencement of the period for which the Secured Indebtedness Leverage Ratio is being calculated but prior to the event for which the calculation of the Secured Indebtedness Leverage Ratio is made (the “ Secured Leverage Calculation Date ”), then the Secured Indebtedness Leverage Ratio shall be calculated giving pro forma effect to such incurrence or redemption of Indebtedness as if the same had occurred at the beginning of the Applicable Four-Quarter Period. The Secured Indebtedness Leverage Ratio shall be calculated in a manner consistent with the definition of “Fixed Charge Coverage Ratio,” including any pro forma calculations to EBITDA (including for acquisitions).
“ Securities Act ” means the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder.
“ Securitization Assets ” means any accounts receivable or other revenue streams subject to a Qualified Securitization Financing.
“ Securitization Fees ” means reasonable distributions or payments made directly or by means of discounts with respect to any participation interest issued or sold in connection with, and other fees paid to a Person that is not a Securitization Subsidiary in connection with, any Qualified Securitization Financing.
“ Securitization Financing ” means any transaction or series of transactions that may be entered into by the Company or any of its Subsidiaries pursuant to which the Company or any of its Subsidiaries may sell, convey or otherwise transfer to (a) a Securitization Subsidiary (in the case of a transfer by the Company or any of its Subsidiaries) and (b) any other Person (in the case of a transfer by a Securitization Subsidiary), or may grant a security interest in, any Securitization Assets (whether now existing or arising in the future) of the Company or any of its Subsidiaries, and any assets related thereto including, without limitation, all collateral securing
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such Securitization Assets, all contracts and all guarantees or other obligations in respect of such Securitization Assets, proceeds of such Securitization Assets and other assets which are customarily transferred or in respect of which security interests are customarily granted in connection with asset securitization transactions involving Securitization Assets and any Hedging Obligations entered into by the Company or any such Subsidiary in connection with such Securitization Assets.
“ Securitization Repurchase Obligation ” means any obligation of a seller of Securitization Assets in a Qualified Securitization Financing to repurchase Securitization Assets arising as a result of a breach of a representation, warranty or covenant or otherwise, including, without limitation, as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, offset or counterclaim of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller.
“ Securitization Subsidiary ” means a Wholly Owned Subsidiary of the Company (or another Person formed for the purposes of engaging in a Qualified Securitization Financing in which the Company or any Subsidiary of the Company makes an Investment and to which the Company or any Subsidiary of the Company transfers Securitization Assets and related assets) which engages in no activities other than in connection with the financing of Securitization Assets of the Company or its Subsidiaries, all proceeds thereof and all rights (contingent and other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and which is designated by the Board of Directors of the Company or such other Person (as provided below) as a Securitization Subsidiary and (a) no portion of the Indebtedness or any other obligations (contingent or otherwise) of which (i) is guaranteed by the Company or any other Subsidiary of the Company (excluding guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings), (ii) is recourse to or obligates the Company or any other Subsidiary of the Company in any way other than pursuant to Standard Securitization Undertakings or (iii) subjects any property or asset of the Company or any other Subsidiary of the Company, directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings, (b) with which neither the Company nor any other Subsidiary of the Company has any material contract, agreement, arrangement or understanding other than on terms which the Company reasonably believes to be no less favorable to either the Company or such Subsidiary than those that might be obtained at the time from Persons that are not Affiliates of the Company and (e) to which neither the Company nor any other Subsidiary of the Company has any obligation to maintain or preserve such entity’s financial condition or cause such entity to achieve certain levels of operating results. Any such designation by the Board of Directors of the Company or such other Person shall be evidenced to the Trustee by filing with the Trustee a certified copy of the resolution of the Board of Directors of the Company or such other Person giving effect to such designation and an Officer’s Certificate certifying that such designation complied with the foregoing conditions.
“ Shareholders Agreement ” means the Shareholders Agreement dated as of April 13, 2006, by and among the Sponsors, Parent and certain other stockholders signatory thereto.
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“ Shelf Registration Statement ” means the Shelf Registration Statement as defined in the Registration Rights Agreement.
“ Significant Subsidiary ” means any Restricted Subsidiary that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect on the date hereof.
“ Sponsors ” means Bain Capital Partners, LLC and its Affiliates.
“ Standard Securitization Undertakings ” means representations, warranties, covenants and indemnities entered into by the Company or any Subsidiary of the Company which the Company has determined in good faith to be customary in a Securitization Financing, including, without limitation, those relating to the servicing of the assets of a Securitization Subsidiary, it being understood that any Securitization Repurchase Obligation shall be deemed to be a Standard Securitization Undertaking.
“ Stated Maturity ” means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which the payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and will not include any contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof.
“ Subordinated Indebtedness ” means (a) with respect to the Company, any Indebtedness of the Company that is by its terms subordinated in right of payment to the Notes and (b) with respect to any Guarantor of the Notes, any Indebtedness of such Guarantor that is by its terms subordinated in right of payment to its Guarantee of the Notes.
“ Subsidiary ” means, with respect to any specified Person:
(a) any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person (or a combination thereof); and
(b) any partnership, joint venture, limited liability company or similar entity of which (x) more than 50% of the capital accounts, distribution rights, total equity and voting interests or general or limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of such Person or a combination thereof whether in the form of membership, general, special or limited partnership or otherwise and (y) such Person or any Wholly Owned Restricted Subsidiary of such Person is a controlling general partner or otherwise controls such entity.
“ Term Loan Facility ” means that certain term loan credit agreement, dated on or about the date of the Indenture among the Company, JPMorgan Chase Bank, NA, as Administrative Agent and Collateral Agent and the lenders party thereto, including any related notes, guarantees,
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collateral documents, instruments and agreements executed in connection therewith, and in each case as amended, restated, supplemented, modified, renewed, refunded, replaced (whether at maturity or thereafter) or refinanced from time to time in one or more agreements or indentures (in each case with the same or new agents, lenders or institutional investors), including any agreement adding or changing the borrower or any guarantor or extending the maturity thereof or otherwise restructuring all or any portion of the Indebtedness thereunder or increasing the amount loaned or issued thereunder or altering the maturity thereof ( provided that such increase in borrowings is permitted under Section 4.9 ).
“ TIA ” means the Trust Indenture Act of 1939 (15 U.S. Code §§ 77aaa-77bbbb), as amended, as in effect on the date hereof.
“ Transactions ” means the transactions contemplated by (i) the Term Loan Facility and (ii) the offering of the Notes, including the Restricted Payments on or after the Issue Date as part of the transactions described under and not to exceed the amount set forth in the section titled “Use of Proceeds” in the Offering Circular.
“ Transfer Restricted Notes ” means Notes that bear or are required to bear the Restricted Notes Legend.
“ Treasury Rate ” means, as of the applicable redemption date, the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two business days prior to such redemption date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from such redemption date to February 15, 2015; provided , however , that if the period from such redemption date to February 15, 2015, is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used.
“ Trustee ” has the meaning set forth in the preamble to this Indenture.
“ Unrestricted Subsidiary ” means (i) any Subsidiary of the Company that at the time of determination is an Unrestricted Subsidiary (as designated by the Board of Directors of the Company, as provided below) and (ii) any Subsidiary of an Unrestricted Subsidiary. The Board of Directors of the Company may designate any Subsidiary of the Company (including any existing Subsidiary and any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary unless such Subsidiary or any of its Subsidiaries owns any Equity Interests or Indebtedness of, or owns or holds any Lien on any property of, the Company or any Subsidiary of the Company (other than any Subsidiary of the Subsidiary to be so designated); provided that (a) any Unrestricted Subsidiary must be an entity of which shares of the Capital Stock or other equity interests (including partnership interests) entitled to cast at least a majority of the votes that may be cast by all shares or equity interests having ordinary voting power for the election of directors or other governing body are owned, directly or indirectly, by the Company, (b) such designation complies with Section 4.7 and (c) each of (I) the Subsidiary to be so designated and (II) its Subsidiaries has not at the time of designation, and does not thereafter, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable with respect to any
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Indebtedness pursuant to which the lender has recourse to any of the assets of the Company or any Restricted Subsidiary (other than the Capital Stock of such Subsidiary to be so designated). The Board of Directors of the Company may designate any Unrestricted Subsidiary to be a Restricted Subsidiary; provided that, immediately after giving effect to such designation, no Event of Default shall have occurred and any Indebtedness assumed or otherwise incurred in connection with such designation shall have been permitted to have been incurred by the Company pursuant to Section 4.9 . Any such designation by the Board of Directors of the Company shall be notified by the Company to the Trustee by promptly filing with the Trustee a copy of the Board Resolution giving effect to such designation and an Officers’ Certificate certifying that such designation complied with the foregoing provisions.
“ U.S. Dollar Equivalent ” means with respect to any monetary amount in a currency other than U.S. dollars, at any time for determination thereof, the amount of U.S. dollars obtained by converting such foreign currency involved in such computation into U.S. dollars at the spot rate for the purchase of U.S. dollars with the applicable foreign currency as published in The Wall Street Journal in the “Exchange Rates” column under the heading “Currency Trading” on the date two business days prior to such determination.
Except as described in Section 4.9 , whenever it is necessary to determine whether the Company has complied with any covenant in this Indenture or a Default has occurred and an amount is expressed in a currency other than U.S. dollars, such amount will be treated as the U.S. Dollar Equivalent determined as of the date such amount is initially determined in such currency.
“ U.S. Government Securities ” means securities that are
(a) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or
(b) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally guaranteed as a full faith and credit obligation by the United States of America,
which, in either case, are not callable or redeemable at the option of the issuers thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such U.S. Government Securities or a specific payment of principal of or interest on any such U.S. Government Securities held by such custodian for the account of the holder of such depository receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the U.S. Government Securities or the specific payment of principal of or interest on the U.S. Government Securities evidenced by such depository receipt.
“ Voting Stock ” of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.
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“ Weighted Average Life to Maturity ” means, when applied to any Indebtedness at any date, the number of years obtained by dividing:
(1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect of the Indebtedness, 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 ” is any Wholly Owned Subsidiary that is a Restricted Subsidiary.
“ Wholly Owned Subsidiary ” of any Person means a Subsidiary of such Person, 100% of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares and shares issued to foreign nationals under applicable law) shall at the time be owned by such Person or by one or more Wholly Owned Subsidiaries of such Person or by such Person and one or more Wholly Owned Subsidiaries of such Person.
SECTION 1.2 Other Definitions .
|
Term |
Defined in
Section |
|||
|
“Act” |
12.14 | (a) | ||
|
“Affiliate Transaction” |
4.11 | |||
|
“Agent Members” |
2.6 | |||
|
“Calculation Date” |
1.1 | |||
|
“Change of Control Payment” |
4.14 | |||
|
“Covenant Defeasance” |
8.3 | |||
|
“Covenant Suspension Event” |
4.20 | |||
|
“Event of Default” |
6.1 | |||
|
“Excess Proceeds” |
4.10 | |||
|
“Legal Defeasance” |
8.2 | |||
|
“Offer Amount” |
3.9 | |||
|
“QIB” |
2.1 | |||
|
“QIB Global Note” |
2.1 | |||
|
“Refinancing Indebtedness” |
4.9 | (b) | ||
|
“Refunding Capital Stock” |
4.7 | |||
|
“Registrar” |
2.3 | |||
|
“Regulation S” |
2.1 | |||
|
“Regulation S Global Note” |
2.1 | |||
|
“Regulation S Permanent Global Note” |
2.1 | |||
|
“Regulation S Temporary Global Note” |
2.1 | |||
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|
Term |
Defined in
Section |
|||
|
“Retired Capital Stock” |
4.7 | |||
|
“Reversion Date” |
4.20 | |||
|
“Rule 144A” |
2.1 | |||
|
“Successor Company” |
5.1 | (a) | ||
|
“Suspended Covenants” |
4.20 | |||
|
“Suspension Period” |
4.20 | |||
SECTION 1.3 Incorporation by Reference of Trust Indenture Act .
Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in, and made a part of, this Indenture.
The following TIA terms have the following meanings:
“ indenture securities ” means the Notes and any Guarantee;
“ indenture security holder ” means a Holder;
“ indenture to be qualified ” means this Indenture;
“ indenture trustee ” or “ institutional trustee ” means the Trustee; and
“ obligor ” on the Notes means the Company and any successor obligor upon the Notes or any Guarantor.
All other terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by the Commission rule under the TIA have the meanings so assigned to them therein.
SECTION 1.4 Rules of Construction .
Unless the context otherwise requires:
(1) a term has the meaning assigned to it herein;
(2) an accounting term not otherwise defined herein has the meaning assigned to it in accordance with GAAP;
(3) “or” is not exclusive;
(4) words in the singular include the plural, and in the plural include the singular;
(5) unless otherwise specified, any reference to Section or Article refers to such Section or Article of this Indenture;
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(6) provisions apply to successive events and transactions; and
(7) references to sections of or rules under the Securities Act or the Exchange Act shall be deemed to include substitute, replacement or successor sections or rules adopted by the Commission from time to time.
ARTICLE II
THE NOTES
SECTION 2.1 Form and Dating .
The Notes and the Trustee’s certificate of authentication shall be substantially in the form of Exhibit A attached hereto. The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage. Each Note shall be dated the date of its authentication. The Notes initially shall be issued only in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.
The terms and provisions contained in the Notes shall constitute, and are hereby expressly made, a part of this Indenture and the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby. However, to the extent any provision of any Note conflicts with the express provisions of this Indenture, the provisions of this Indenture shall govern and be controlling.
(a) The Notes shall be issued initially in the form of one or more Global Notes substantially in the form attached as Exhibit A hereto, which shall be deposited on behalf of the purchasers of the Notes represented thereby with the Trustee as custodian for the Depositary, and registered in the name of the Depositary or a nominee of the Depositary, duly executed by the Company and authenticated by the Trustee as hereinafter provided.
Each Global Note shall represent such of the outstanding Notes as shall be specified therein and each shall provide that it shall represent the aggregate amount of outstanding Notes from time to time endorsed thereon and that the aggregate amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges, redemptions and transfers of interests. Any endorsement of a Global Note to reflect the amount of any increase or decrease in the amount of outstanding Notes represented thereby shall be made by the Trustee or the Note Custodian, at the direction of the Trustee, in accordance with instructions given by the Holder thereof as required by Section 2.6 hereof.
Except as set forth in Section 2.6 hereof, the Global Notes may be transferred, in whole and not in part, only to another nominee of the Depositary or to a successor of the Depositary or its nominee.
(b) The Initial Notes are being issued by the Company only (i) to “qualified institutional buyers” (as defined in Rule 144A under the Securities Act (“ Rule 144A ”)) (“ QIBs ”) and (ii) in reliance on Regulation S under the Securities Act (“ Regulation S ”).
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After such initial offers, Initial Notes that are Transfer Restricted Notes may be transferred to QIBs, in reliance on Rule 144A or outside the United States pursuant to Regulation S or to the Company, in accordance with certain transfer restrictions. Initial Notes that are offered in reliance on Rule 144A shall be issued in the form of one or more permanent Global Notes substantially in the form set forth in Exhibit A (the “ QIB Global Note ”) deposited with the Trustee, as Note Custodian, duly executed by the Company and authenticated by the Trustee as hereinafter provided. Initial Notes that are offered in offshore transactions in reliance on Regulation S shall be issued in the form of one or more temporary Global Notes substantially in the form set forth in Exhibit A , including the Regulation S Temporary Global Note legend (the “ Regulation S Temporary Global Note ”) deposited with the Trustee, as Note Custodian, duly executed by the Company and authenticated by the Trustee as hereinafter provided. Reasonably promptly following the date that is 40 days after the later of the commencement of the offering of the Notes in reliance on Regulation S and the Issue Date, a single permanent global Note in registered form substantially in the form of Exhibit A (the “ Regulation S Permanent Global Note ,” and together with the Regulation S Temporary Global Note, the “ Regulation S Global Note ”) duly executed by the Company and authenticated by the Trustee as hereinafter provided shall be deposited with the Trustee, as custodian for the Depositary, and the Registrar shall reflect on its books and records the cancellation of the Regulation S Temporary Global Note and the issuance of the Regulation S Permanent Global Note. The QIB Global Note and the Regulation S Global Note shall each be issued with separate CUSIP numbers. The aggregate principal amount of each Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as Note Custodian. Transfers of Notes between QIBs and to or by purchasers pursuant to Regulation S shall be represented by appropriate increases and decreases to the respective amounts of the appropriate Global Notes, as more fully provided in Section 2.16 .
(c) Section 2.1(b) shall apply only to Global Notes deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with Section 2.1(b) and this Section 2.1(c) , authenticate and deliver the Global Notes that (i) shall be registered in the name of the Depositary or the nominee of the Depositary and (ii) shall be delivered by the Trustee to the Depositary or pursuant to the Depositary’s instructions or held by the Trustee as Note Custodian for the Depositary.
Participants shall have no rights either under this Indenture with respect to any Global Note held on their behalf by the Depositary or by the Note Custodian as custodian for the Depositary or under such Global Note, and the Depositary may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee or any Agent or other agent of the Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depositary or impair, as between the Depositary and its
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Participants, the operation of customary practices of such Depositary governing the exercise of the rights of an owner of a beneficial interest in any Global Note.
The Trustee shall have no responsibility or obligation to any Holder that is a member of (or a participant in) DTC or any other Person with respect to the accuracy of the records of DTC (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 of any notice (including any notice of redemption) or the payment of any amount or delivery of any Notes (or other security or property) under or with respect to the Notes. The Trustee may rely (and shall be fully protected in relying) upon information furnished by DTC with respect to its members, participants and any beneficial owners in the Notes.
(d) Notes issued in certificated form shall be substantially in the form of Exhibit A attached hereto.
SECTION 2.2 Execution and Authentication .
An Officer shall sign the Notes for the Company by manual or facsimile signature.
If an Officer whose signature is on a Note no longer holds that office at the time a Note is authenticated, the Note shall nevertheless be valid.
A Note shall not be valid until authenticated by the manual signature of a Responsible Officer of the Trustee. The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Company signed by one Officer directing the Trustee to authenticate the Notes and certifying that all conditions precedent to the issuance of the Notes contained herein have been complied with, authenticate Notes for original issue up to the aggregate principal amount stated in paragraph 4 of the Notes. The aggregate principal amount of Notes outstanding at any time may not exceed such amount except as provided in Section 2.8 hereof.
The Trustee may appoint an authenticating agent reasonably acceptable to the Company to authenticate Notes. Unless limited by the terms of such appointment, an authenticating agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with Holders or the Company or an Affiliate of the Company.
SECTION 2.3 Registrar; Paying Agent .
The Company shall maintain (i) an office or agency where Notes may be presented for registration of transfer or for exchange (“ Registrar ”) and (ii) an office or agency where Notes may be presented for payment to a Paying Agent. The Registrar shall keep a register of the Notes and of their transfer and exchange. The Company may appoint one or more co-registrars and one or more additional paying agents. The term “Registrar” includes any co-registrar and the term “Paying Agent” includes any additional paying agent. The Company may change any
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Paying Agent or Registrar without notice to any Holder. The Company shall notify the Trustee in writing of the name and address of any Agent not a party to this Indenture. If the Company fails to appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Company or any of its Subsidiaries may act as Paying Agent or Registrar.
The Company shall notify the Trustee and the Trustee shall notify the Holders of the name and address of any Agent not a party to this Indenture. The Company or any Guarantor may act as Paying Agent or Registrar. The Company shall enter into an appropriate agency agreement with any Agent not a party to this Indenture, which shall incorporate the provisions of the TIA. The agreement shall implement the provisions of this Indenture that relate to such Agent. The Company shall notify the Trustee of the name and address of any such Agent. If the Company 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 7.7 hereof.
The Company initially appoints the Trustee to act as the Note Custodian, Registrar and Paying Agent.
The Company initially appoints DTC to act as the Depositary with respect to the Global Notes.
SECTION 2.4 Paying Agent to Hold Money in Trust .
The Company shall require each Paying Agent other than the Trustee to agree in writing that the 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, premium or Additional Interest, if any, or interest on the Notes, and shall notify the Trustee of any Default by the Company in making any such payment. While any such Default continues, the Trustee may require a Paying Agent to pay all money held by it to the Trustee. The Company at any time may require a Paying Agent to pay all money held by it to the Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the Company or a Subsidiary) shall have no further liability for the money. If the Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all money held by it as Paying Agent. Upon the occurrence of events specified in Section 6.1(7) hereof, the Trustee shall serve as Paying Agent for the Notes.
SECTION 2.5 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 all Holders and shall otherwise comply with TIA § 312(a). If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least seven (7) Business Days before each interest payment date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of the Holders, including the aggregate principal amount of the Notes held by each Holder thereof, and the Company shall otherwise comply with TIA § 312(a).
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SECTION 2.6 Book-Entry Provisions for Global Securities .
(a) Each Global Note shall (i) be registered in the name of the Depositary for such Global Notes or the nominee of such Depositary, (ii) be delivered to the Trustee as custodian for such Depositary and (iii) bear legends as required by Section 2.6(e) .
Members of, or participants in, the Depositary (“ Agent Members ”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by the Depositary, or the Trustee as Note Custodian, or under the Global Note, and the Depositary may be treated by the Company, the Trustee Note Custodian and any agent of the Company or the Trustee as the absolute owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Trustee Note Custodian or any agent of the Company or the Trustee, from giving effect to any written certification, proxy or other authorization furnished by the Depositary or impair, as between the Depositary and its Agent Members, the operation of customary practices governing the exercise of the rights of a Holder of any Note.
(b) Transfers of a Global Note shall be limited to transfers of such Global Note in whole, but not in part, to the Depositary, its successors or their respective nominees. Interests of beneficial owners in a Global Note may be transferred in accordance with Section 2.16 and the rules and procedures of the Depositary. In addition, Certificated Notes shall be transferred to all beneficial owners (or the requesting beneficial owners, in the case of clause (ii)) in exchange for their beneficial interests only if (i) the Depositary notifies the Company that it is unwilling or unable to continue as Depositary for the Global Notes or the Depositary ceases to be a “clearing agency” registered under the Exchange Act and a successor depositary is not appointed by the Company within ninety (90) days of such notice or (ii) an Event of Default of which a Responsible Officer of the Trustee has actual notice has occurred and is continuing and the Registrar has received a request from any beneficial owner of an interest in the Global Note (subject to the fourth paragraph of Section 2.1(c) hereof) to issue such Certificated Notes.
(c) In connection with the transfer of the entire Global Note to beneficial owners pursuant to clause (b) of this Section, such Global Note shall be deemed to be surrendered to the Trustee for cancellation, and the Company shall execute, and the Trustee shall authenticate and deliver, to each beneficial owner identified by the Depositary in exchange for its beneficial interest in such Global Note an equal aggregate principal amount of Certificated Notes of authorized denominations.
(d) The registered holder of a Global Note may grant proxies and otherwise authorize any person, including Agent Members and persons that may hold interest through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Notes.
(e) Each Global Note shall bear the Global Note Legend on the face thereof.
(f) At such time as all beneficial interests in Global Notes have been exchanged for Certificated Notes, redeemed, repurchased or cancelled, all Global Notes shall be returned to or retained and cancelled by the Trustee in accordance with Section 2.11 hereof. At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for Certificated
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Notes, redeemed, repurchased or cancelled, the principal amount of Notes represented by such Global Note shall be reduced accordingly and an endorsement shall be made on such Global Note, by the Trustee or the Note Custodian, at the direction of the Trustee, to reflect such reduction.
(g) General Provisions Relating to Transfers and Exchanges .
(1) To permit registrations of transfers and exchanges, the Company shall execute and the Trustee shall authenticate Global Notes and Certificated Notes at the Registrar’s request.
(2) No service charge shall be made to a Holder for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any stamp or transfer tax or similar governmental charge payable in connection therewith (other than any such stamp or transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.2 , 2.10 , 3.7 , 4.10 , 4.14 and 9.5 hereto).
(3) All Global Notes and Certificated Notes issued upon any registration of transfer or exchange of Global Notes or Certificated Notes shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Global Notes or Certificated Notes surrendered upon such registration of transfer or exchange.
(4) The Registrar shall not be required (A) to issue, to register the transfer of or to exchange Notes during a period beginning at the opening of fifteen (15) days before the day of any selection of Notes for redemption under Section 3.2 hereof and ending at the close of business on the day of selection, (B) to register the transfer of or to exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part, or (C) to register the transfer of or to exchange a Note between a record date and the next succeeding interest payment date.
(5) Prior to due presentment for the registration of a transfer of any Note, the Trustee, any Agent and the Company may deem and treat the Person in whose name any Note is registered as the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such Notes and for all other purposes, and neither the Trustee, any Agent nor the Company shall be affected by notice to the contrary.
(6) The Trustee shall authenticate Global Notes and Certificated Notes in accordance with the provisions of Section 2.2 hereof. Except as provided in Section 2.6(b) , neither the Trustee nor the Registrar shall authenticate or deliver any Certificated Note in exchange for a Global Note.
(7) Each Holder agrees to provide reasonable indemnity to the Company 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 United States federal or state securities law.
(8) The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable
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law with respect to any transfer of any interest in any Note (including any transfers between or among Agent Members or beneficial owners of interests in any Global Note) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.
(h) Exchange Offer . Upon the occurrence of the Exchange Offer (as defined in the Registration Rights Agreement) in accordance with the Registration Rights Agreement, the Company shall issue and, upon receipt of an Authentication Order in accordance with Section 2.2, the Trustee shall authenticate (i) one or more Global Notes that are not Transfer Restricted Securities in an aggregate principal amount equal to the principal amount of the beneficial interests in the Global Notes that are Transfer Restricted Securities tendered for acceptance by Persons that certify in the applicable letters of transmittal that (x) they are not affiliates (as defined in Rule 144) of the Company, (y) they are not engaged in, and do not intend to engage in, and have no arrangement or understanding with any Person to participate in, a distribution of the Notes to be issued in the Exchange Offer (the “ Exchange Notes ”) and (z) they are acquiring the Exchange Notes in their ordinary course of business and (ii) Certificated Notes that are not Transfer Restricted Securities in an aggregate principal amount equal to the principal amount of the Certificated Notes that are Transfer Restricted Securities accepted for exchange in the Exchange Offer (as defined in the Registration Rights Agreement). Concurrently with the issuance of such Notes, the Trustee shall cause the aggregate principal amount of the Global Notes that are Transfer Restricted Securities to be reduced accordingly, and the Trustee shall deliver to the Persons designated by the Holders of Global Notes that are Transfer Restricted Securities or Holders of Certificated Notes that are Transfer Restricted Securities so accepted the Global Notes that are not Transfer Restricted Securities or Certificated Notes that are not Transfer Restricted Securities issued and authenticated in accordance with the preceding sentence in the appropriate principal amount.
SECTION 2.7 Replacement Notes .
If any mutilated Note is surrendered to the Trustee, or the Company and the Trustee receive evidence to their satisfaction of the destruction, loss or theft of any Note, the Company shall issue and the Trustee, upon the written order of the Company signed by an Officer of the Company, shall authenticate a replacement Note if the Trustee’s requirements are met. If required by the Trustee or the Company, an indemnity bond must be supplied by the Holder that is sufficient in the judgment of the Trustee to protect itself and in the judgment of the Company to protect the Company, the Trustee, any Agent and any authenticating agent from any loss that any of them may suffer if a Note is replaced. The Company and the Trustee may charge for their expenses in replacing a Note.
Every replacement Note is an additional obligation of the Company and shall be entitled to all of the benefits of this Indenture equally and proportionately with all other Notes duly issued hereunder.
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SECTION 2.8 Outstanding Notes .
The Notes outstanding at any time are all the Notes authenticated by the Trustee except for those cancelled by it, those delivered to it for cancellation, those reductions in the interest in a Global Note effected by the Trustee in accordance with the provisions hereof, and those described in this Section 2.8 as not outstanding. Except as set forth in Section 2.9 hereof, a Note does not cease to be outstanding because the Company or an Affiliate of the Company holds the Note.
If a Note is replaced pursuant to Section 2.7 hereof, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section 4.1 hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Company, a Subsidiary or an Affiliate of any thereof) holds, on a redemption date or maturity date, money sufficient to pay Notes payable on that date, then on and after that date such Notes shall be deemed to be no longer outstanding and shall cease to accrue interest.
SECTION 2.9 Treasury Notes .
In determining whether the Holders of the required aggregate principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Company or by any Affiliate of the Company shall be considered as though not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes shown on the register as being owned shall be so disregarded. Notwithstanding the foregoing, Notes that are to be acquired by the Company or an Affiliate of the Company pursuant to an exchange offer, tender offer or other agreement shall not be deemed to be owned by such entity until legal title to such Notes passes to such entity.
SECTION 2.10 Temporary Notes .
Until Certificated Notes are ready for delivery, the Company may prepare and the Trustee shall authenticate temporary Notes upon a written order of the Company signed by one Officer of the Company. Temporary Notes shall be substantially in the form of Certificated Notes but may have variations that the Company considers appropriate for temporary Notes. Without unreasonable delay, the Company shall prepare and the Trustee shall upon receipt of a written order of the Company signed by one Officer authenticate Certificated Notes in exchange for temporary Notes.
Holders of temporary Notes shall be entitled to all of the benefits of this Indenture.
SECTION 2.11 Cancellation .
The Company at any time may deliver to the Trustee for cancellation any Notes previously authenticated and delivered hereunder or which the Company may have acquired in
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any manner whatsoever, and all Notes so delivered shall be promptly cancelled by the Trustee. All Notes surrendered for registration of transfer, exchange or payment, if surrendered to any Person other than the Trustee, shall be delivered to the Trustee. The Trustee and no one else shall cancel all Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation. Subject to Section 2.7 hereof, the Company may not issue new Notes to replace Notes that it has redeemed or paid or that have been delivered to the Trustee for cancellation. All cancelled Notes held by the Trustee shall be disposed of in accordance with its customary practice, and certification of their disposal delivered to the Company.
SECTION 2.12 Defaulted Interest .
If the Company defaults in a payment of interest on the Notes, it shall pay the defaulted interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, which date shall be at the earliest practicable date but in all events at least five (5) Business Days prior to the payment date, in each case at the rate provided in the Notes and in Section 4.1 hereof. The Company shall fix or cause to be fixed each such special record date and payment date and shall promptly thereafter notify the Trustee of any such date. At least fifteen (15) days before the special record date, the Company (or the Trustee, in the name and at the expense of the Company) shall mail or cause to be mailed to Holders a notice that states the special record date, the related payment date and the amount of such interest to be paid.
SECTION 2.13 Record Date .
Unless otherwise set forth in this Indenture, the record date for purposes of determining the identity of Holders entitled to vote or consent to any action by vote or consent authorized or permitted under this Indenture shall be determined as provided for in TIA § 316 (c).
SECTION 2.14 Computation of Interest .
Interest and Additional Interest, if any, on the Notes shall be computed on the basis of a 360-day year comprised of twelve 30-day months.
SECTION 2.15 CUSIP Number .
The Company in issuing the Notes may use a “CUSIP” number, and if it does so, the Trustee shall use the CUSIP number 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 the CUSIP number 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 Company shall promptly notify the Trustee of any change in the CUSIP number.
SECTION 2.16 Special Transfer Provisions .
Each Initial Note and each Additional Note issued pursuant to an exemption from registration under the Securities Act will constitute a Transfer Restricted Note and be required to bear the Restricted Notes Legend until the expiration of the Resale Restriction Termination Date
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therefor, unless and until such Transfer Restricted Note is transferred or exchanged pursuant to an effective registration statement under the Securities Act. The following provisions shall apply to the transfer of a Transfer Restricted Note:
(a) Transfers to QIBs . The following provisions shall apply with respect to the registration of any proposed transfer of a Transfer Restricted Note (other than pursuant to Regulation S):
(i) The Registrar shall register the transfer of a Transfer Restricted Note by a Holder to a QIB if such transfer is being made by a proposed transferor who has provided the Registrar with (a) an appropriately completed certificate of transfer in the form attached to the Note and (b) a letter substantially in the form set forth in Exhibit C hereto.
(ii) If the proposed transferee is an Agent Member and the Transfer Restricted Note to be transferred consists of an interest in the Regulation S Global Note, upon receipt by the Registrar of (x) the items required by paragraph (i) above and (y) instructions given in accordance with the Depositary’s and the Registrar’s procedures therefor, the Registrar shall reflect on its books and records the date and an increase in the principal amount of the QIB Global Note in an amount equal to the principal amount of the beneficial interest in the Regulation S Global Note to be so transferred, and the Registrar shall reflect on its books and records the date and an appropriate decrease in the principal amount of such Regulation S Global Note.
(b) Transfers Pursuant to Regulation S . The following provisions shall apply with respect to registration of any proposed transfer of a Transfer Restricted Note pursuant to Regulation S:
(i) The Registrar shall register any proposed transfer of a Transfer Restricted Note pursuant to Regulation S by a Holder upon receipt of (a) an appropriately completed certificate of transfer in the form attached to the Note and (b) a letter substantially in the form set forth in Exhibit D hereto from the proposed transferor.
(ii) If the proposed transferee is an Agent Member holding a beneficial interest in a QIB Global Note and the Transfer Restricted Note to be transferred consists of an interest in a QIB Global Note, upon receipt by the Registrar of (x) the letter, if any, required by paragraph (i) above and (y) instructions in accordance with the Depositary’s and the Registrar’s procedures therefor, the Registrar shall reflect on its books and records the date and an increase in the principal amount of the Regulation S Global Note in an amount equal to the principal amount of the beneficial interest in the QIB Global Note to be transferred, and the Registrar shall reflect on its books and records the date and an appropriate decrease in the principal amount of the QIB Global Note.
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(c) Restricted Notes Legend . Upon the transfer, exchange or replacement of Notes not bearing the Restricted Notes Legend, the Registrar shall deliver Notes that do not bear the Restricted Notes Legend. Upon the transfer, exchange or replacement of Notes bearing the Restricted Notes Legend, the Registrar shall deliver only Notes that bear the Restricted Notes Legend unless there is delivered to the Registrar an Opinion of Counsel reasonably satisfactory to the Company and the Trustee to the effect that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act.
(d) General . By its acceptance of any Note bearing the Restricted Notes Legend, each Holder of such a Note acknowledges the restrictions on transfer of such Note set forth in this Indenture and in the Restricted Notes Legend and agrees that it shall transfer such Note only as provided in this Indenture. A transfer of a beneficial interest in a Global Note that does not involve an exchange of such interest for a Certificated Note or a beneficial interest in another Global Note shall be subject to compliance with applicable law and the applicable procedures of the Depositary, but is not subject any procedure required by this Indenture.
The Registrar shall retain copies of all letters, notices and other written communications received pursuant to this Section 2.16 .
SECTION 2.17 Issuance of Additional Notes .
The Company shall be entitled to issue Additional Notes, including Exchange Notes, under this Indenture that shall have identical terms as the Initial Notes, other than with respect to the date of issuance, issue price and amount of interest payable on the first interest payment date applicable thereto (and, if such Additional Notes shall be issued in the form of Transfer Restricted Notes, other than with respect to transfer restrictions, any registration rights agreement and additional interest with respect thereto); provided that such issuance is not prohibited by the terms of this Indenture, including Section 4.9 and Section 4.12 . The Initial Notes and any Additional Notes or Exchange Notes shall be treated as a single class for all purposes under this Indenture.
With respect to any Additional Notes, the Company shall set forth in a resolution of its Board of Directors and in an Officers’ Certificate, a copy of each of which shall be delivered to the Trustee, the following information:
(1) the aggregate principal amount of such Additional Notes to be authenticated and delivered pursuant to this Indenture;
(2) the issue price, the issue date, the CUSIP number of such Additional Notes, the first interest payment date and the amount of interest payable on such first interest payment date applicable thereto and the date from which interest shall accrue; and
(3) whether such Additional Notes shall be Transfer Restricted Notes.
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ARTICLE III
REDEMPTION AND PREPAYMENT
SECTION 3.1 Notices to Trustee .
If the Company elects to redeem Notes pursuant to the optional redemption provisions of Section 3.7 hereof, it shall furnish to the Trustee, at least thirty (30) days before a redemption date, an Officers’ Certificate setting forth (i) the section of this Indenture pursuant to which the redemption shall occur, (ii) the redemption date, (iii) the principal amount of Notes to be redeemed and (iv) the Redemption Price.
If the Company is required to make an offer to purchase Notes pursuant to Section 4.10 or 4.14 hereof, it shall furnish to the Trustee, at least thirty (30) days before the scheduled purchase date, an Officers’ Certificate setting forth (i) the section of this Indenture pursuant to which the offer to purchase shall occur, (ii) the terms of the offer, (iii) the principal amount of Notes to be purchased, (iv) the purchase price and (v) the purchase date and further setting forth a statement to the effect that (a) the Company or one of its Subsidiaries has effected an Asset Sale and there are Excess Proceeds aggregating more than $20.0 million or (b) a Change of Control has occurred, as applicable.
The Company will also provide the Trustee with any additional information that the Trustee reasonably requests in connection with any redemption or offer.
SECTION 3.2 Selection of Notes to Be Redeemed .
If less than all of the Notes are to be redeemed at any time, the Trustee shall select the Notes to be redeemed as follows: (1) if the Notes are listed on any national securities exchange, in compliance with the requirements of the principal national securities exchange on which the Notes are listed; or (2) if the Notes are not so listed, on a pro rata basis to the extent practicable and with adjustments so that no Notes are redeemed in part in an unauthorized denomination or by lot or such other method as the Trustee shall deem fair and appropriate (and in a manner that complies with applicable legal requirements). No Notes of $2,000 or less shall be redeemed in part.
Except as otherwise provided herein, notices of redemption shall be mailed by first class mail at least 30 but not more than 60 days before the redemption date to each Holder of Notes to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a satisfaction and discharge of this Indenture. Except for a redemption to be effected pursuant to Section 3.7 , notices of redemption may not be conditional. If any Note is to be redeemed in part only, the notice of redemption that relates to such Note shall state the portion of the principal amount thereof to be redeemed. A new Note in principal amount equal to the unredeemed portion of the original Note will be issued in the name of the Holder thereof upon cancellation of the original Note (or appropriate adjustments to the amount and beneficial interests in a Global Note will be made, as appropriate). Notes called for redemption become due on the date fixed for redemption.
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On and after the redemption date, interest ceases to accrue on Notes or portions of them called for redemption. The Trustee shall make the selection from the Notes outstanding and not previously called for redemption as long as the Company has deposited with the Paying Agent funds in satisfaction of the applicable Redemption Price pursuant to this Indenture and shall promptly notify the Company in writing of the Notes selected for redemption. The Trustee may select for redemption portions (equal to $2,000 or any integral multiples of $1,000 thereof) of the principal of the Notes that have denominations larger than $2,000.
SECTION 3.3 Notice of Redemption .
Subject to the provisions of Section 3.9 , at least 30 days but not more than 60 days before a redemption date, the Company shall mail or cause to be mailed by first class mail, a notice of redemption to each Holder whose Notes are to be redeemed.
The notice shall identify the Notes to be redeemed and shall state:
(1) the redemption date;
(2) the Redemption Price;
(3) if any Note is being redeemed in part, the portion of the principal amount of such Notes to be redeemed and that, after the redemption date, upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion shall be issued upon cancellation of the original Note;
(4) the name, telephone number and address of the Paying Agent;
(5) that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price;
(6) that, unless the Company defaults in making such redemption payment, interest, if any, on Notes called for redemption ceases to accrue on and after the redemption date;
(7) the paragraph of the Notes and/or Section of this Indenture pursuant to which the Notes called for redemption are being redeemed;
(8) any condition to such redemption as permitted by Section 3.4 hereof; and
(9) that no representation is made as to the correctness or accuracy of the CUSIP number, if any, listed in such notice or printed on the Notes.
At the Company’s request, the Trustee shall give the notice of redemption in the Company’s name and at the Company’s expense; provided , however , that the Company shall have delivered to the Trustee, at least 45 days prior to the redemption date (or such shorter period as is acceptable to the Trustee), an Officers’ Certificate requesting that the Trustee give such notice and setting forth the information to be stated in the notice as provided in the preceding paragraph. The notice mailed in the manner herein provided shall be conclusively presumed to
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have been duly given whether or not the Holder receives such notice. In any case, failure to give such notice by mail or any defect in the notice to the Holder of any Note shall not affect the validity of the proceeding for the redemption of any other Note.
SECTION 3.4 Effect of Notice of Redemption .
Once notice of redemption is mailed in accordance with Section 3.3 hereof, Notes called for redemption become irrevocably due and payable on the redemption date at the Redemption Price plus accrued and unpaid interest and Additional Interest, if any, to such date. Any redemption or notice of redemption may, at the Company’s discretion, be subject to one or more conditions precedent, including, but not limited to, completion of an Equity Offering, other offering or other corporate transaction or event. Notice of any redemption in respect of an Equity Offering may be given prior to the completion thereof.
SECTION 3.5 Deposit of Redemption of Purchase Price .
On or before 10:00 a.m. (New York City time) on each redemption date or the date on which Notes must be accepted for purchase pursuant to Section 4.10 or 4.14 , the Company shall deposit with the Trustee or with the Paying Agent (other than the Company or an Affiliate of the Company) money sufficient to pay the Redemption Price of and accrued and unpaid interest and Additional Interest, if any, on all Notes to be redeemed or purchased on that date. The Trustee or the Paying Agent shall promptly return to the Company any money deposited with the Trustee or the Paying Agent by the Company in excess of the amounts necessary to pay the Redemption Price of (including any applicable premium), and accrued interest and Additional Interest, if any, on, all Notes to be redeemed or purchased.
If Notes called for redemption or tendered in an Asset Sale Offer or Change of Control Offer are paid or if the Company has deposited with the Trustee or Paying Agent money sufficient to pay the redemption or purchase price of, and unpaid and accrued interest, if any, on, all Notes to be redeemed or purchased, on and after the redemption or purchase date, interest, if any, shall cease to accrue on the Notes or the portions of Notes called for redemption or tendered and not withdrawn in an Asset Sale Offer or Change of Control Offer (regardless of whether certificates for such securities are actually surrendered). If a Note is redeemed or purchased on or after an interest record date but on or prior to the related interest payment date, then any accrued and unpaid interest and Additional Interest, if any, shall be paid to the Person in whose name such Note was registered at the close of business on such record date. If any Note called for redemption shall not be so paid upon surrender for redemption because of the failure of the Company to comply with the preceding paragraph, interest shall be paid on the unpaid principal from the redemption or purchase date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case, at the rate provided in the Notes and in Section 4.1 hereof.
SECTION 3.6 Notes Redeemed in Part .
Upon surrender of a Note that is redeemed in part, the Company shall issue and, upon the written request of an Officer of the Company, the Trustee shall authenticate for the Holder at the expense of the Company a new Note equal in principal amount to the unredeemed portion of the
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Note surrendered; provided that each such new Note will be in a principal amount of $2,000 or integral multiples of $1,000 in excess thereof.
SECTION 3.7 Optional Redemption .
(a) The Notes may be redeemed in whole or in part, at any time prior to February 15, 2015, at the option of the Company upon not less than 30 nor more than 60 days’ prior notice mailed by first-class mail to each Holder’s registered address, 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, the applicable redemption date (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date).
(b) The Notes are subject to redemption, at the option of the Company, in whole or in part, at any time on or after February 15, 2015, upon not less than 30 nor more than 60 days’ notice at the following Redemption Prices (expressed as a percentage of the principal amount to be redeemed) set forth below, plus accrued and unpaid interest and Additional Interest, if any, to, but not including, the redemption date (subject to the right of Holders of record on the relevant regular record date to receive interest due on an interest payment date that is on or prior to the redemption date), if redeemed during the 12-month period beginning February 15 of the years indicated:
|
Year |
Redemption
Price |
|||
|
2015 |
105.000 | % | ||
|
2016 |
102.500 | % | ||
|
2017 and thereafter |
100.000 | % | ||
(c) In addition to the optional redemption of the Notes in accordance with the provisions of the preceding paragraph, prior to February 15, 2014, the Company may, with the net cash proceeds of one or more Equity Offerings, redeem up to 35% of the aggregate principal amount of the outstanding Notes at a Redemption Price of 110.000% of the principal amount thereof, plus accrued and unpaid interest and Additional Interest, thereon, if any, to the date of redemption ( provided that if the Equity Offering is an offering by Holdings or any of its direct or indirect parent corporations, a portion of the net cash proceeds thereof equal to the amount required to redeem any such Notes is contributed to the equity capital of the Company); provided , however , that at least 65% of the principal amount of Notes originally issued under this Indenture must remain outstanding immediately after the occurrence of each such redemption (excluding in such calculation Notes held by Holdings and its Subsidiaries) and that any such redemption occurs within 90 days following the date of the closing of such Equity Offering.
SECTION 3.8 Mandatory Redemption .
Except as set forth under Sections 3.9 , 4.10 and 4.14 hereof, the Company shall not be required to make mandatory redemption or sinking fund payments with respect to the Notes.
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SECTION 3.9 Offer to Purchase .
In the event that the Company shall be required to commence an Offer to Purchase pursuant to an Asset Sale Offer or a Change of Control Offer, the Company shall follow the procedures specified below.
On the Purchase Date, the Company shall purchase the aggregate principal amount of Notes required to be purchased pursuant to Section 4.10 hereof or Section 4.14 hereof (the “ Offer Amount ”), or if less than the Offer Amount has been tendered, all Notes tendered in response to the Offer to Purchase. Payment for any Notes so purchased shall be made in the same manner as interest payments are made. If the Purchase Date is on or after the interest record date and on or before the related interest payment date, any accrued and unpaid interest and Additional Interest, if any, shall be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest, if any, shall be payable to the Holders who tender Notes pursuant to the Offer to Purchase. The Company shall notify the Trustee at least 15 days (or such shorter period as is acceptable to the Trustee) prior to the mailing of the Offer of the Company’s obligation to make an Offer to Purchase, and the Offer shall be mailed by the Company or, at the Company’s request, by the Trustee in the name and at the expense of the Company. The Offer shall contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Offer to Purchase.
On or before 10:00 a.m. (New York City time) on each Purchase Date, the Company shall irrevocably deposit with the Trustee or Paying Agent (other than the Company or an Affiliate of the Company) in immediately available funds the aggregate purchase price equal to the Offer Amount, together with accrued and unpaid interest, if any, thereon, to be held for payment in accordance with the terms of this Section 3.9 . On the Purchase Date, the Company shall, to the extent lawful, (i) accept for payment, on a pro rata basis to the extent necessary, provided however, with such adjustments so that no Notes are purchased in part in an unauthorized denomination, the Offer Amount of Notes or portions thereof tendered pursuant to the Offer to Purchase, or if less than the Offer Amount has been tendered, all Notes tendered, (ii) deliver or cause the Paying Agent or depositary, as the case may be, to deliver to the Trustee Notes so accepted and (iii) deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.9 . The Company, the Depositary or the Paying Agent, as the case may be, shall promptly (but in any case not later than three (3) Business Days after the Purchase Date) mail or deliver to each tendering Holder an amount equal to the purchase price of the Notes tendered by such Holder and accepted by the Company for purchase, plus any accrued and unpaid interest and Additional Interest, if any, thereon, and the Company shall promptly issue a new Note, and the Trustee, at the written request of the Company, shall authenticate and mail or deliver at the expense of the Company such new Note to such Holder, equal in principal amount to any unpurchased portion of such Holder’s Notes surrendered. Any Note not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof. The Company shall publicly announce in a newspaper of general circulation or in a press release provided to a nationally recognized financial wire service the results of the Offer to Purchase on the Purchase Date.
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Other than as specifically provided in this Section 3.9 , any purchase pursuant to this Section 3.9 shall be made pursuant to the provisions of Sections 3.1 through 3.6 hereof.
ARTICLE IV
COVENANTS
SECTION 4.1 Payment of Notes .
(a) The Company shall pay or cause to be paid the principal of, premium, if any, and interest on the Notes on the dates and in the manner provided in the Notes. Principal, premium, if any, and interest shall be considered paid for all purposes hereunder on the date the Paying Agent, if other than the Company or a Subsidiary thereof, holds, as of 10:00 a.m. (New York City time), money deposited by the Company in immediately available funds and designated for and sufficient to pay all such principal, premium, if any, and interest then due. The Company shall pay all Additional Interest, if any, in the same manner on the dates and amounts set forth in the Registration Rights Agreement.
(b) The Company shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at the rate equal to 1% per annum in excess of the then applicable interest rate on the Notes to the extent lawful; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest and Additional Interest, if any (without regard to any applicable grace period), at the same rate to the extent lawful.
SECTION 4.2 Maintenance of Office or Agency .
The Company shall maintain an office or agency (which may be an office of the Trustee or an affiliate of the Trustee or Registrar) where Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company in respect of the Notes and this Indenture may be served. The Company shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee.
The Company may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations. The Company shall give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.
The Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with Section 2.3 hereof.
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SECTION 4.3 Provision of Financial Information .
Whether or not required by the Commission, so long as any Notes are outstanding, if not filed electronically with the Commission through the Commission’s Electronic Data Gathering, Analysis, and Retrieval System (or any successor system), the Company will furnish to the holders of Notes, within the time periods specified in the Commission’s rules and regulations:
(1) all quarterly and annual financial information that would be required to be contained in a filing with the Commission on Forms 10-Q and 10-K, if the Company were required to file such Forms, including a “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and, with respect to the annual information only, a report on the annual financial statements by the Company’s certified independent accountants; and
(2) all current reports that would be required to be filed with the Commission on Form 8-K if the Company were required to file such reports.
In addition, whether or not required by the Commission, after the consummation of the Exchange Offer or the effectiveness of the Shelf Registration Statement, the Company will file a copy of all of the information and reports referred to in clauses (1) and (2) above with the Commission for public availability within the time periods specified in the Commission’s rules and regulations (unless the Commission will not accept such a filing) for a filer that is not an “accelerated filer” (as defined in such rules and regulations) and make such information available to securities analysts and prospective investors upon request. In addition, the Company has agreed that, for so long as any Notes remain outstanding, it will furnish to the holders of the Notes 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.
In addition, if at any time any direct or indirect parent (including Holdings) is or becomes a Guarantor (there being no obligation of any such parent to do so), holds no material assets other than cash, Cash Equivalents and the Capital Stock of the Company or any other direct or indirect parent of the Company (and performs the related incidental activities associated with such ownership) and complies with the requirements of Rule 3-10 of Regulation S-X promulgated by the Commission (or any successor provision), the reports, information and other documents required to be filed and furnished to holders of the Notes pursuant to this covenant may, at the option of the Company, be filed by and be those of such parent rather than the Company.
Notwithstanding the foregoing, such requirements shall be deemed satisfied prior to the commencement of the Exchange Offer or the effectiveness of a Shelf Registration Statement relating to the registration of the Notes under the Securities Act by the filing with the Commission of an Exchange Offer Registration Statement, and any amendments thereto, with such financial information that satisfies Regulation S-X of the Securities Act within the time periods and in accordance with the other provisions described in the Registration Rights Agreement.
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The Company shall provide the Trustee with a sufficient number of copies of all reports and other documents and information and, if requested by the Company, the Trustee will deliver such reports to the Holders under this Section 4.3 .
SECTION 4.4 Compliance Certificate .
The Company shall deliver to the Trustee, within 90 days after the end of each fiscal year beginning with the fiscal year ended January 29, 2012, an Officers’ Certificate stating that a review of the activities of the Company and its Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officers with a view to determining whether each has kept, observed, performed and fulfilled its obligations under this Indenture, and further stating, as to each such Officer signing such certificate, that, to the best of his or her knowledge, each entity has kept, observed, performed and fulfilled each and every covenant contained in this Indenture and is not in default in the performance or observance of any of the terms, provisions and conditions of this Indenture (or, if a Default or Event of Default shall have occurred, describing all such Defaults or Events of Default of which he or she may have knowledge and what action the Company is taking or proposes to take with respect thereto) and that, to the best of his or her knowledge, no event has occurred and remains in existence by reason of which payments on account of the principal of, premium, if any, or interest on the Notes is prohibited or if such event has occurred, a description of the event and what action the Company is taking or proposes to take with respect thereto.
The Company shall, so long as any of the Notes are outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware of any Default or Event of Default, an Officers’ Certificate specifying such Default or Event of Default, its status and what action the Company is taking or proposes to take in respect thereof.
SECTION 4.5 Taxes .
The Company shall pay, and shall cause each of its Subsidiaries to pay, prior to delinquency all material taxes, assessments and governmental levies, except such as are contested in good faith and by appropriate proceedings and with respect to which appropriate reserves have been taken in accordance with GAAP or where the failure to effect such payment is not adverse in any material respect to the Holders of the Notes.
SECTION 4.6 Stay, Extension and Usury Laws .
The Company covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this Indenture; and the Company and each of the Guarantors (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it shall not, by resort to any such law, 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 has been enacted.
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SECTION 4.7 Limitation on Restricted Payments .
The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly:
(a) declare or pay any dividend or make any other distribution on account of the Company’s or any of its Restricted Subsidiaries’ Equity Interests, including any dividend or distribution payable in connection with any merger or consolidation (other than (i) dividends or distributions by the Company payable in Equity Interests (other than Disqualified Stock) of the Company or in options, warrants or other rights to purchase such Equity Interests (other than Disqualified Stock), (ii) dividends or distributions by a Restricted Subsidiary payable to the Company or any other Restricted Subsidiary or (iii) in the case of any dividend or distribution payable on or in respect of any class or series of securities issued by a Restricted Subsidiary other than a Wholly Owned Subsidiary, pro rata dividends or distributions to minority stockholders of such Restricted Subsidiary (or owners of an equivalent interest in the case of a Subsidiary that is an entity other than a corporation), provided that the Company or one of its Restricted Subsidiaries 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);
(b) purchase, redeem or otherwise acquire or retire for value any Equity Interests of the Company or any direct or indirect parent entity of the Company held by any Person (other than by a Restricted Subsidiary), including in connection with any merger or consolidation;
(c) make any principal payment on, or redeem, repurchase, defease or otherwise acquire or retire for value, in each case prior to any scheduled repayment, sinking fund payment or maturity, any Subordinated Indebtedness (other than (x) Indebtedness permitted under clauses (7) and (8) of the definition of “Permitted Debt” or (y) the purchase, repurchase or other acquisition or retirement of Indebtedness subordinated or junior in right of payment to the Notes purchased in anticipation of satisfying a sinking fund obligation, principal installment or final maturity, in each case due within one year of the date of purchase, repurchase, acquisition or retirement); or
(d) make any Restricted Investment;
(all such payments and other actions set forth in these clauses (a) through (d) being collectively referred to as “ Restricted Payments ”), unless, at the time of and after giving effect to such Restricted Payment:
(1) no Default or Event of Default has occurred and is continuing or would occur as a consequence of such Restricted Payment;
(2) the Company would, at the time of such Restricted Payment and after giving pro forma effect thereto as if such Restricted Payment had been made at the beginning of the Applicable Four-Quarter Period, have been permitted to
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incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in the Section 4.9(a) ; and
(3) such Restricted Payment, together with the aggregate amount of all other Restricted Payments made by the Company and its Restricted Subsidiaries after the Issue Date (excluding Restricted Payments permitted by clauses (2), (3), (4), (5), (6), (7), (9), (10), (11), (12), (13), (14), (15) and (16) of the next succeeding paragraph; provided that the calculation of Restricted Payments shall also exclude the amounts paid or distributed pursuant to clause (1) of the next paragraph to the extent that the declaration of such dividend or other distribution shall have previously been included as a Restricted Payment), is less than the sum, without duplication, of
(a) 50% of the Consolidated Net Income of the Company for the period (taken as one accounting period) from the first fiscal quarter commencing following the Issue Date to the end of the Company’s most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment (or, in the case such Consolidated Net Income for such period is a deficit, minus 100% of such deficit), plus
(b) 100% of the aggregate net cash proceeds and the fair market value, as determined in good faith by the Board of Directors of the Company, of property and marketable securities received by the Company after the Issue Date from the issue or sale of (x) Equity Interests of the Company (including Retired Capital Stock (as defined in the next paragraph) but excluding (i) cash proceeds received from the sale of Equity Interests of the Company and, to the extent actually contributed to the Company, Equity Interests of the Company’s direct or indirect parent corporations to members of management, directors or consultants of the Company, any direct or indirect parent corporation of the Company and the Subsidiaries of the Company after the Issue Date to the extent such amounts have been applied to Restricted Payments made in accordance with clause (4) of the next succeeding paragraph, (ii) cash proceeds received from the sale of Refunding Capital Stock (as defined in the next paragraph) to the extent such amounts have been applied to Restricted Payments made in accordance with clause (2) of the next succeeding paragraph, (iii) Designated Preferred Stock, (iv) the Cash Contribution Amount and (v) Disqualified Stock) or (y) debt securities of the Company that have been converted into such Equity Interests of the Company (other than Refunding Capital Stock or Equity Interests or convertible debt securities of Holdings sold to a Restricted Subsidiary or Holdings, as the case may be, and other than Disqualified Stock or Designated Preferred Stock or debt securities that have been converted into Disqualified Stock or Designated Preferred Stock), plus
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(c) 100% of the aggregate amount of cash and the fair market value, as determined in good faith by the Board of Directors of the Company, of property and marketable securities contributed to the capital of the Company after the Issue Date (other than (i) by a Restricted Subsidiary, (ii) any Excluded Contributions, (iii) any Disqualified Stock, (iv) any Refunding Capital Stock, (v) any Designated Preferred Stock, (vi) the Cash Contribution Amount and (vii) cash proceeds applied to Restricted Payments made in accordance with clause (4) of the next succeeding paragraph), plus
(d) to the extent not already included in Consolidated Net Income, 100% of the aggregate amount received in cash and the fair market value, as determined in good faith by the Board of Directors of the Company, of property and marketable securities received after the Issue Date by means of (A) the sale or other disposition (other than to the Company or a Restricted Subsidiary) of Restricted Investments made by the Company or its Restricted Subsidiaries and repurchases and redemptions of such Restricted Investments from the Company or its Restricted Subsidiaries and repayments of loans or advances which constitute Restricted Investments of the Company or its Restricted Subsidiaries or (B) the sale (other than to the Company or a Restricted Subsidiary) of the Capital Stock of an Unrestricted Subsidiary or a distribution from an Unrestricted Subsidiary (other than in each case to the extent the Investment in such Unrestricted Subsidiary was made by a Restricted Subsidiary pursuant to clause (10) of the next succeeding paragraph or to the extent such Investment constituted a Permitted Investment) or a dividend from an Unrestricted Subsidiary, plus
(e) in the case of the redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary or the merger or consolidation of an Unrestricted Subsidiary into the Company or a Restricted Subsidiary or the transfer of assets of an Unrestricted Subsidiary to the Company or a Restricted Subsidiary, the fair market value of the Investment in such Unrestricted Subsidiary, as determined by the Board of Directors of the Company in good faith at the time of the redesignation of such Unrestricted Subsidiary as a Restricted Subsidiary or at the time of such merger, consolidation or transfer of assets (other than an Unrestricted Subsidiary to the extent the Investment in such Unrestricted Subsidiary was made by a Restricted Subsidiary pursuant to clause (10) of the next succeeding paragraph or to the extent such Investment constituted a Permitted Investment).
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The preceding provisions will not prohibit:
(1) the payment of any dividend or other distribution within 60 days after the date of declaration thereof, if at the date of declaration such payment would have complied with the provisions of this Indenture;
(2)(A) the redemption, repurchase, retirement or other acquisition of any Equity Interests of the Company or any direct or indirect parent of the Company (“ Retired Capital Stock ”) or Indebtedness subordinated to the Notes in exchange for or out of the net cash proceeds of the substantially concurrent sale (other than to a Restricted Subsidiary or the Company) of Equity Interests of the Company or contributions to the equity capital of the Company (in each case, other than Disqualified Stock and the Cash Contribution Amount) (“ Refunding Capital Stock ”) and (B) the declaration and payment of dividends on the Retired Capital Stock out of the net cash proceeds of the substantially concurrent sale (other than to a Subsidiary of the Company or to an employee stock ownership plan or any trust established by the Company or any of its Subsidiaries) of Refunding Capital Stock;
(3) the redemption, repurchase or other acquisition or retirement of Indebtedness subordinated to the Notes made by exchange for, or out of the proceeds of the substantially concurrent sale of, new Indebtedness of the borrower thereof which is incurred in compliance with Section 4.9 so long as (A) such new Indebtedness is subordinated to the Notes and any Guarantees thereof at least to the same extent as such Indebtedness subordinated to such Notes so redeemed, repurchased, acquired or retired, (B) such new Indebtedness has a final scheduled maturity date equal to or later than the final scheduled maturity date of the Indebtedness subordinated to such Notes being so redeemed, repurchased, acquired or retired and (C) such new Indebtedness has a Weighted Average Life to Maturity equal to or greater than the remaining Weighted Average Life to Maturity of the Indebtedness subordinated to such Notes being so redeemed, repurchased, acquired or retired;
(4) a Restricted Payment to pay for the repurchase, retirement or other acquisition or retirement for value of Equity Interests of the Company or any of its direct or indirect parent corporations held by any future, present or former employee, director or consultant of the Company, any Subsidiary or any of its direct or indirect parent corporations (or their permitted transferees, assigns, estates or heirs) pursuant to any management equity plan or stock option plan or any other management or employee benefit plan, agreement or arrangement, provided , however , that the aggregate amount of Restricted Payments made under this clause (4) does not exceed in any calendar year $10.0 million (with any unused amounts in any calendar year being carried over to the two immediately succeeding calendar years); and provided , further , that such amount in any calendar year may be increased by an amount not to exceed (A) the cash proceeds from the sale of Equity Interests (other than Disqualified Stock) of the Company and, to the extent contributed to the Company, Equity Interests of any of its direct or indirect parent corporations, in each case to members of management, directors or consultants of the Company, any of its Subsidiaries or any of its direct or indirect parent corporations
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that occurs after the Issue Date plus (B) the cash proceeds of “key man” life insurance policies received by the Company or its Restricted Subsidiaries after the Issue Date ( provided that the Company may elect to apply all or any portion of the aggregate increase contemplated by clauses (A) and (B) above in any calendar year) (it being understood that the forgiveness of any debt by such Person shall not be a Restricted Payment hereunder) less (C) the amount of any Restricted Payments previously made pursuant to clauses (A) and (B) of this clause (4);
(5) the declaration and payment of dividends to holders of any class or series of Disqualified Stock of the Company or any Restricted Subsidiary issued or incurred in accordance with this covenant to the extent such dividends are included in the definition of “Fixed Charges” for such entity;
(6) the declaration and payment of dividends or distributions to holders of any class or series of Designated Preferred Stock (other than Disqualified Stock) issued after the Issue Date and the declaration and payment of dividends to any direct or indirect parent corporation of the Company the proceeds of which will be used to fund the payment of dividends to holders of any class or series of Designated Preferred Stock (other than Disqualified Stock) of any direct or indirect parent corporation of the Company issued after the Issue Date; provided , however , that (A) for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date of issuance of such Designated Preferred Stock, after giving effect to such issuance (and the payment of dividends or distributions thereon) on a pro forma basis, the Company would have had a Fixed Charge Coverage Ratio of at least 2.0 to 1.0 and (B) the aggregate amount of dividends declared and paid pursuant to this clause (6) does not exceed the net cash proceeds actually received by the Company from any such sale of Designated Preferred Stock (other than Disqualified Stock) issued after the Issue Date;
(7) repurchases of Equity Interests deemed to occur upon exercise of stock options or warrants if such Equity Interests represent a portion of the exercise price of such options or warrants;
(8) the payment of dividends on the Company’s common stock (or the payment of dividends to any direct or indirect parent company of the Company, as the case may be, to fund the payment by any such parent company of the Company of dividends on such entity’s common stock) following the first public offering of the Company’s common stock or the common stock of any of its direct or indirect parent corporations after the Issue Date, of up to 6.0% per annum of the net cash proceeds received by or contributed to the Company after the Issue Date in any such public offering, other than public offerings of common stock of the Company (or any direct or indirect parent company of the Company) registered on Form S-4 or Form S-8 and other than any public sale constituting an Excluded Contribution;
(9) Restricted Payments that are made with Excluded Contributions;
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(10) other Restricted Payments in an aggregate amount not to exceed $25.0 million after the Issue Date;
(11) distributions or payments of Securitization Fees and purchases of Securitization Assets pursuant to a Securitization Repurchase Obligation in connection with a Qualified Securitization Financing;
(12) the repurchase, redemption or other acquisition or retirement for value of any Subordinated Indebtedness pursuant to provisions similar to those described in Sections 3.9 , 4.10 and 4.14 ; provided that a Change of Control Offer or Asset Sale Offer, as applicable, has been made and all Notes tendered by holders of the Notes in connection with a Change of Control Offer or Asset Sale Offer, as applicable, have been repurchased, redeemed or acquired for value;
(13) the declaration and payment of dividends to, or the making of loans to, a direct or indirect parent corporation of the Company in amounts required for such Person to pay, without duplication:
(A) franchise taxes and other fees, taxes and expenses required to maintain its corporate existence;
(B) income taxes to the extent such income taxes are attributable to the income of the Company and its Restricted Subsidiaries and, to the extent of the amount actually received from the Unrestricted Subsidiaries, in amounts required to pay such taxes to the extent attributable to the income of the Unrestricted Subsidiaries, provided , however , that in each case the amount of such payments in any fiscal year does not exceed the amount of income taxes that the Company and its Restricted Subsidiaries would be required to pay for such fiscal year were the Company and its Restricted Subsidiaries to pay such taxes as a stand-alone taxpayer;
(C) customary salary, bonus, severance, indemnification obligations and other benefits payable to officers and employees of such direct or indirect parent corporation of the Company to the extent such salaries, bonuses, severance, indemnification obligations and other benefits are attributable to the ownership or operation of the Company and its Restricted Subsidiaries;
(D) general corporate overhead and operating expenses for such direct or indirect parent corporation of the Company to the extent such expenses are attributable to the ownership or operation of the Company and its Restricted Subsidiaries;
(E) reasonable fees and expenses incurred in connection with any unsuccessful debt or equity offering or other financing transaction by such direct or indirect parent corporation of the Company;
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(F) taxes with respect to income of any direct or indirect parent company of the Company derived from funding made available to the Company and its Restricted Subsidiaries by such direct or indirect parent company; and
(G) obligations under the Management Agreement (as in effect on the Issue Date);
(14) cash payments in lieu of the issuance of fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Capital Stock of the Company; provided , however , that any such cash payment shall not be for the purpose of evading the limitation of this Section 4.7 (as determined in good faith by the Board of Directors of the Company);
(15) the distribution, by dividend or otherwise, of shares of Capital Stock of, or Indebtedness owed to the Company or a Restricted Subsidiary by, Unrestricted Subsidiaries; or
(16) any payments made in connection with the consummation of the Transactions as described in the Offering Circular;
provided , however , that at the time of, and after giving effect to, any Restricted Payment permitted under clauses (6), (8), (10), (12) and (13)(G) above, no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof.
The amount of all Restricted Payments (other than cash) will be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or issued by the Company or such Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market value of any assets or securities that are required to be valued by this covenant will be determined in good faith by the Board of Directors of the Company. Such determination must be based upon an opinion or appraisal issued by an Independent Financial Advisor if the fair market value exceeds $50.0 million.
As of the Issue Date, all of the Company’s Subsidiaries will be Restricted Subsidiaries. The Company will not permit any Unrestricted Subsidiary to become a Restricted Subsidiary except pursuant to the second to last sentence of the definition of “Unrestricted Subsidiary.” For purposes of designating any Restricted Subsidiary as an Unrestricted Subsidiary, all outstanding investments by the Company and the Restricted Subsidiaries (except to the extent repaid) in the Subsidiary so designated will be deemed to be Restricted Payments in an amount determined as set forth in the second paragraph of the definition of “Investments.” Such designation will be permitted only if a Restricted Payment in such amount would be permitted at such time under this covenant or the definition of “Permitted Investments” and if such Subsidiary otherwise meets the definition of an Unrestricted Subsidiary.
For the avoidance of doubt, any dividend or distribution otherwise permitted pursuant to this Section 4.7 may be in the form of a loan.
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SECTION 4.8 Limitation on Dividends and Other Payment Restrictions Affecting Subsidiaries.
(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become effective any consensual encumbrance or restriction on the ability of any such Restricted Subsidiary to:
(1) pay dividends or make any other distributions on its Capital Stock to the Company or any of its Restricted Subsidiaries, or with respect to any other interest or participation in, or measured by, its profits, or pay any Indebtedness owed to the Company or any of its Restricted Subsidiaries;
(2) make loans or advances to the Company or any of its Restricted Subsidiaries; or
(3) sell, lease or transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries.
(b) However, the preceding restrictions will not apply to encumbrances or restrictions existing under or by reason of:
(1) contractual encumbrances or restrictions in effect (x) pursuant to a Credit Facility or related documents as in effect on the Issue Date or (y) on the Issue Date, including, without limitation, pursuant to Indebtedness in existence on the Issue Date;
(2) this Indenture and the Notes and Guarantees (including any Exchange Notes with respect to the Notes and related Guarantees);
(3) purchase money obligations or other obligations described in clause (4) of the definition of “Permitted Debt” that, in each case, impose restrictions of the nature discussed in Section 4.8(a)(3) on the property so acquired;
(4) applicable law or any applicable rule, regulation or order;
(5) any agreement or other instrument of a Person acquired by the Company or any Restricted Subsidiary in existence at the time of such acquisition (but not created in connection therewith or in contemplation thereof or to provide all or a portion of the funds or credit support utilized to consummate such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person, or the property or assets of the Person, so acquired;
(6) contracts for the sale of assets, including without limitation, customary restrictions with respect to a Subsidiary pursuant to an agreement that has been entered into for the sale or disposition of all or substantially all of the Capital Stock or assets of such Subsidiary;
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(7) Secured Indebtedness otherwise permitted to be incurred pursuant to Sections 4.9 and 4.12 that limits the right of the debtor to dispose of the assets securing such Indebtedness;
(8) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business;
(9) other Indebtedness or Preferred Stock of any Restricted Subsidiary (i) that is a Guarantor that is incurred subsequent to the Issue Date pursuant to Section 4.9 or (ii) that is incurred by a Foreign Subsidiary of the Company subsequent to the Issue Date;
(10) customary provisions in joint venture agreements and other similar agreements entered into in the ordinary course of business;
(11) customary provisions contained in leases, subleases, licenses or asset sale agreements and other agreements; and
(12) any encumbrances or restrictions of the type referred to in Section 4.8(a)(1) , (2) and (3) imposed by any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the contracts, instruments or obligations referred to in clauses (1) through (11) of this Section 4.8(b) ; provided that the encumbrances or restrictions imposed by such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings are, in the good faith judgment of the Board of Directors of the Company, not materially less favorable to the holders of the Notes than encumbrances and restrictions contained in such predecessor agreements and do not affect the Company’s and Guarantors’ ability, taken as a whole, to make payments of interest and scheduled payments of principal in respect of the Notes, in each case as and when due; provided, further , however , that with respect to agreements existing on the Issue Date, any refinancings or amendments thereof contain such encumbrances or restrictions that are not materially less favorable to the holders of the Notes than the encumbrances or restrictions contained in such agreements as in effect on the Issue Date.
SECTION 4.9 Indebtedness and Issuance of Preferred Stock .
(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively “ incur ”) any Indebtedness (including Acquired Debt) and will not permit any of its Restricted Subsidiaries to issue any shares of Preferred Stock; provided , however , that the Company and any Restricted Subsidiary that is a Guarantor may incur Indebtedness (including Acquired Debt) and any Restricted Subsidiary that is a Guarantor may issue Preferred Stock if the Fixed Charge Coverage Ratio of the Company and its Subsidiaries (on a consolidated combined basis) for the Company’s most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Preferred Stock is issued would have been at least 2.0 to 1.0 determined on a pro forma basis (including a pro forma application of the net proceeds therefrom), as if the additional
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Indebtedness had been incurred or the Preferred Stock had been issued, as the case may be, and the application of proceeds therefrom had occurred at the beginning of such four-quarter period.
(b) Section 4.9(a) shall not prohibit the incurrence of any of the following (collectively, “Permitted Debt”):
(1)(A) the incurrence by the Company or a Restricted Subsidiary of Indebtedness under the ABL Facility together with the incurrence by the Company or any Restricted Subsidiary of the guarantees thereunder and the issuance and creation of letters of credit and bankers’ acceptances thereunder (with letters of credit and bankers’ acceptances being deemed to have a principal amount equal to the face amount thereof), up to an aggregate principal amount equal to the greater of (x) the Borrowing Base and (y) $600.0 million outstanding at any one time, less the amount of all payments actually made by the borrower thereunder in respect of Indebtedness thereunder with Net Proceeds from Asset Sales pursuant to Section 4.10(c)(1) ; and (B) the incurrence by the Company or a Restricted Subsidiary of Indebtedness under the Term Loan Facility together with the incurrence by the Company or any Restricted Subsidiary of the guarantees thereunder, up to an aggregate principal amount equal to $1,000.0 million outstanding at any one time, less the amount of all payments actually made by the borrower thereunder in respect of Indebtedness thereunder with Net Proceeds from Asset Sales pursuant to Section 4.10(c)(1) ;
(2) the incurrence by the Company and the Guarantors of Indebtedness represented by the Notes (including any Guarantee thereof) on the Issue Date and any Notes issued in exchange for such Notes (including any Guarantee thereof) pursuant to the Registration Rights Agreement;
(3) any Indebtedness of the Company and its Restricted Subsidiaries in existence on the Issue Date (other than Indebtedness described in clauses (1) or (2) of this Section 4.9(b) );
(4) Indebtedness (including Capitalized Lease Obligations) incurred by the Company or any Restricted Subsidiary to finance the purchase, lease or improvement of property (real or personal) or equipment that is used or useful in a Permitted Business (whether through the direct purchase of assets or the Capital Stock of any Person owning such assets) in an aggregate principal amount that, when aggregated with the principal amount of all other Indebtedness then outstanding and incurred pursuant to this clause (4), does not exceed the greater of $90.0 million and 3.5% of Consolidated Total Assets;
(5) Indebtedness incurred by the Company or any Restricted Subsidiary constituting reimbursement obligations with respect to letters of credit issued in the ordinary course of business, including without limitation letters of credit in respect of workers’ compensation claims, health, disability or other employee benefits or property, casualty or liability insurance or self-insurance or other Indebtedness with respect to reimbursement-type obligations regarding workers’ compensation claims; provided , however , that upon the drawing of such letters of credit or the incurrence of such
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Indebtedness, such obligations are reimbursed within 30 days following such drawing or incurrence;
(6) Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price, earn-outs or similar obligations, in each case, incurred or assumed in connection with the disposition or acquisition of any business, assets or a Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or Subsidiary for the purpose of financing such acquisition; provided , however , that (A) such Indebtedness is not reflected on the balance sheet of the Company or any Restricted Subsidiary (contingent obligations referred to in a footnote to financial statements and not otherwise reflected on the balance sheet will not be deemed to be reflected on such balance sheet for purposes of this clause (A)) and (B) the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds including noncash proceeds (the fair market value of such noncash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received by the Company and any Restricted Subsidiaries in connection with a disposition;
(7) Indebtedness of the Company owed to and held by any Restricted Subsidiary or Indebtedness of a Restricted Subsidiary owed to and held by the Company or any other Restricted Subsidiary; provided , however , that (A) any subsequent issuance or transfer of any Capital Stock or any other event that results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any subsequent transfer of any such Indebtedness (except to the Company or a Restricted Subsidiary) shall be deemed, in each case, to constitute the incurrence of such Indebtedness by the issuer thereof and (B) if the Company or a Guarantor is the obligor on such Indebtedness, such Indebtedness is expressly subordinated in right of payment to all obligations of the Company or such Guarantor with respect to the Notes;
(8) shares of Preferred Stock of a Restricted Subsidiary issued to the Company or a Restricted Subsidiary; provided that any subsequent issuance or transfer of any Capital Stock or any other event which results in any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or any other subsequent transfer of any such shares of Preferred Stock (except to the Company or a Restricted Subsidiary) shall be deemed in each case to be an issuance of such shares of Preferred Stock;
(9) Hedging Obligations of the Company or any Restricted Subsidiary (excluding Hedging Obligations entered into for speculative purposes) for the purpose of limiting, hedging or managing (A) interest rates with respect to any Indebtedness that is permitted by the terms of this Indenture to be outstanding, (B) currency exchange rates or (C) commodity prices;
(10) obligations in respect of performance and surety bonds, appeal bonds and other similar types of bonds and performance and completion guarantees provided by the Company or any Restricted Subsidiary or obligations in respect of letters of credit related thereto, in each case in the ordinary course of business or consistent with past practice;
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(11) Indebtedness of the Company or any Restricted Subsidiary or Preferred Stock of any Restricted Subsidiary not otherwise permitted hereunder in an aggregate principal amount or liquidation preference which, when aggregated with the principal amount and liquidation preference of all other Indebtedness and Preferred Stock then outstanding and incurred pursuant to this clause (11), does not at any one time outstanding exceed $50.0 million;
(12)(x) any guarantee by the Company or a Guarantor of Indebtedness or other obligations of any Restricted Subsidiary so long as the incurrence of such Indebtedness by such Restricted Subsidiary is permitted under the terms of this Indenture; provided that if such Indebtedness is by its express terms subordinated in right of payment to the Notes or the Guarantee of such Restricted Subsidiary or the Company, as applicable, any such guarantee of such Guarantor with respect to such Indebtedness shall be subordinated in right of payment to such Guarantor’s Guarantee with respect to the Notes substantially to the same extent as such Indebtedness is subordinated to the Notes or the Guarantee of such Restricted Subsidiary, as applicable, (y) any guarantee by a Restricted Subsidiary that is not a Guarantor of Indebtedness of another Restricted Subsidiary that is not a Guarantor incurred in accordance with the terms of this Indenture, and (z) any guarantee by a Guarantor of Indebtedness of the Company incurred in accordance with the terms of this Indenture;
(13) the incurrence by the Company or any Restricted Subsidiary of Indebtedness or Preferred Stock that serves to refund or refinance any Indebtedness incurred as permitted under Section 4.9(a) and Section 4.9(b)(2) , (3) , (14) and (19) and this clause (13) or any Indebtedness issued to so refund or refinance such Indebtedness including additional Indebtedness incurred to pay premiums and fees in connection therewith (the “ Refinancing Indebtedness ”) prior to its respective maturity; provided , however , that such Refinancing Indebtedness (A) has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is incurred which is not less than the earlier of (x) the Stated Maturity of the Indebtedness being refunded or refinanced and (y) the Stated Maturity of any Notes then outstanding, (B) to the extent such Refinancing Indebtedness refinances Indebtedness subordinated or pari passu to the Notes or the Guarantees, such Refinancing Indebtedness is subordinated or pari passu to the Notes or the Guarantees at least to the same extent as the Indebtedness being refinanced or refunded, (C) shall not include (x) Indebtedness or Preferred Stock of a Subsidiary that is not a Guarantor that refinances Indebtedness or Preferred Stock of the Company or a Guarantor or (y) Indebtedness or Preferred Stock of the Company or a Restricted Subsidiary that refinances Indebtedness or Preferred Stock of an Unrestricted Subsidiary, (D) shall not be in a principal amount in excess of the principal amount of, premium, if any, accrued interest on, and related fees and expenses of, the Indebtedness being refunded or refinanced and (E) shall not have a stated maturity date that is earlier than the earlier of (x) the Stated Maturity of the Indebtedness being refunded or refinanced and (y) the Stated Maturity of any Notes then outstanding;
(14) Indebtedness or Preferred Stock of a Person incurred and outstanding on or prior to the date on which such Person was acquired by the Company or any Restricted
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Subsidiary or merged into the Company or a Restricted Subsidiary in accordance with the terms of this Indenture; provided that such Indebtedness or Preferred Stock is not incurred in connection with or in contemplation of, or to provide all or any portion of the funds or credit support utilized to consummate, such acquisition or merger; and provided , further , that after giving effect to such incurrence of Indebtedness either (A) the Company would be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in Section 4.9(a) or (B) the Fixed Charge Coverage Ratio would be greater than such Fixed Charge Coverage Ratio immediately prior to such acquisition;
(15) Indebtedness arising from the honoring by a bank or financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business; provided that such Indebtedness is extinguished within five business days of its incurrence;
(16) Indebtedness of the Company or any of its Restricted Subsidiaries supported by a letter of credit issued pursuant to a Credit Facility in a principal amount not in excess of the stated amount of such letter of credit;
(17) Indebtedness incurred by a Securitization Subsidiary in a Qualified Securitization Financing that is not recourse to the Company or any of its Restricted Subsidiaries, other than a Securitization Subsidiary (except for Standard Securitization Undertakings);
(18) Indebtedness consisting of promissory notes issued by the Company or any Guarantor to current or former officers, directors and employees, their respective estates, spouses or former spouses to finance the purchase or redemption of Equity Interests of Company or any of its direct or indirect parent corporations permitted by Section 4.7 ;
(19) Contribution Indebtedness;
(20) Indebtedness of the Company or any Restricted Subsidiary to the extent the proceeds of such Indebtedness are deposited and used to defease the Notes as described in Article VIII ;
(21) Indebtedness of the Company or any Restricted Subsidiary consisting of the financing of insurance premiums in the ordinary course of business; and
(22) Indebtedness incurred by a Foreign Subsidiary, provided , however , that the aggregate principal amount of Indebtedness incurred under this clause (22) which, when aggregated with the principal amount of all other Indebtedness then outstanding and incurred pursuant to this clause (22) does not exceed the greater of (x) $30.0 million and (y) an amount equal to 1.5% of Consolidated Total Assets of the Foreign Subsidiaries of the Company.
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(c) For purposes of determining compliance with this Section 4.9 in the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in Sections 4.9(b)(1) through (22) , or is entitled to be incurred pursuant to Section 4.9(a) , the Company will be permitted to classify and later reclassify such item of Indebtedness in any manner that complies with this definition, and such item of Indebtedness will be treated as having been incurred pursuant to only one of such categories. Accrual of interest, the accretion of accreted value and the payment of interest in the form of additional Indebtedness will not be deemed to be an incurrence of Indebtedness for purposes of this definition. Notwithstanding the foregoing, Indebtedness under the Credit Facilities outstanding on the Issue Date will be deemed to have been incurred on such date in reliance on the exception provided by clause (1) of the definition of “Permitted Debt.” Additionally, all or any portion of any item of Indebtedness may later be reclassified as having been incurred pursuant to the first paragraph of this definition or under any category of Permitted Debt described in Sections 4.9(b)(1) through (22) so long as such Indebtedness is permitted to be incurred pursuant to such provision at the time of reclassification.
(d) For purposes of determining compliance with any U.S. dollar restriction on the incurrence of Indebtedness where the Indebtedness incurred is denominated in a different currency, the amount of such Indebtedness will be the U.S. Dollar Equivalent determined on the date of the incurrence of such Indebtedness; provided , however , that if any such Indebtedness denominated in a different currency is subject to a currency agreement with respect to U.S. dollars covering all principal, premium, if any, and interest payable on such Indebtedness, the amount of such Indebtedness expressed in U.S. dollars will be as provided in such currency agreement. The principal amount of any refinancing Indebtedness incurred in the same currency as the Indebtedness being refinanced will be the U.S. Dollar Equivalent of the Indebtedness being refinanced, except to the extent that (1) such U.S. Dollar Equivalent was determined based on a currency agreement, in which case the refinancing Indebtedness will be determined in accordance with the preceding sentence, and (2) the principal amount of the refinancing Indebtedness exceeds the principal amount of the Indebtedness being refinanced, in which case the U.S. Dollar Equivalent of such excess will be determined on the date such refinancing Indebtedness is incurred. The maximum amount of Indebtedness that the Company and its Restricted Subsidiaries may incur pursuant to this Section 4.9 shall not be deemed to be exceeded, with respect to any outstanding Indebtedness, solely as a result of fluctuations in the exchange rate of currencies.
(e) The Company will not, and will not permit any Restricted Subsidiary that is a Guarantor to, directly or indirectly, incur any Indebtedness that is or purports to be by its terms (or by the terms of any agreement governing such Indebtedness) contractually subordinated or junior in right of payment to any Indebtedness (including Acquired Debt) of the Company or such Restricted Subsidiary, as the case may be, unless such Indebtedness is also by its terms (or by the terms of any agreement governing such Indebtedness) made expressly subordinate to the Notes to the extent and in the same manner as such Indebtedness is subordinated to other Indebtedness of the Company or such Guarantor’s Guarantee of the Notes (as applicable). Indebtedness shall not be considered subordinate or junior in right of payment by virtue of being secured to a greater or lesser extent or with different priority.
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SECTION 4.10 Asset Sales .
(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, consummate an Asset Sale unless:
(1) the Company (or such Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Sale at least equal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of;
(2) in the case of Asset Sales involving consideration in excess of $10.0 million, the fair market value is determined in good faith by the Company’s Board of Directors; and
(3) at least 75% of the consideration received in the Asset Sale by the Company or such Restricted Subsidiary is in the form of cash or Cash Equivalents.
(b) For purposes of Section 4.10(a)(3) , the amount of (i) any liabilities (as shown on the Company’s or the applicable Restricted Subsidiary’s most recent balance sheet or in the notes thereto) of the Company or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes or the Guarantees) that are assumed by the transferee of any such assets and from which the Company and all Restricted Subsidiaries have been validly released by all creditors in writing, (ii) any securities received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or Restricted Subsidiary into cash (to the extent of the cash received) within 180 days following the closing of such Asset Sale, (iii) any assets described in Section 4.10(c)(2) or (3) , and (iv) any Designated Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Asset Sale having an aggregate fair market value (as determined in good faith by the Board of Directors of the Company), taken together with all other Designated Noncash Consideration received pursuant to this clause (iv) that is at that time outstanding, not to exceed the greater of (x) $60.0 million and (y) an amount equal to 3.0% of Consolidated Total Assets of the Company on the date on which such Designated Noncash Consideration is received (with the fair market value of each item of Designated Noncash Consideration being measured at the time received without giving effect to subsequent changes in value), shall be deemed to be cash for purposes of this paragraph and for no other purpose.
(c) Within 365 days after the receipt of any Net Proceeds from an Asset Sale, the Company may apply those Net Proceeds at its option:
(1) to reduce Obligations under Secured Indebtedness of the Company or any Guarantor or Indebtedness of the Company that ranks pari passu with the Notes ( provided that if the Company shall so reduce Obligations under Indebtedness that ranks pari passu with the Notes (other than Secured Indebtedness), it will equally and ratably reduce Obligations under the Notes by causing the Company to make an offer (in accordance with the procedures set forth below for an Asset Sale Offer to all holders of Notes to purchase at a purchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest and Additional Interest, if any, on the pro rata principal amount of Notes) or Indebtedness of a Restricted Subsidiary that (x) is a Subsidiary of
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the Company and (y) is not a Guarantor, in each case other than Indebtedness owed to Holdings or an Affiliate of Holdings; and/or
(2) to an investment in (i) any one or more Permitted Businesses; provided that such investment in any Permitted Business is in the form of the acquisition of Capital Stock and results in the Company or a Restricted Subsidiary owning an amount of the Capital Stock of such business such that such business constitutes a Restricted Subsidiary, (ii) capital expenditures or (iii) other non-current assets, that in the case of each of (ii) and (iii), are used or useful in a Permitted Business; and/or
(3) to an investment in (i) any one or more Permitted Businesses; provided that such investment in any Permitted Business is in the form of the acquisition of Capital Stock and it results in the Company or a Restricted Subsidiary owning an amount of the Capital Stock of such business such that such business constitutes a Restricted Subsidiary, (ii) properties or (iii) assets that, in each of (i), (ii) and (iii), replace the businesses, properties and assets that are the subject of such Asset Sale.
(d) Any Net Proceeds from an Asset Sale not applied or invested in accordance with the preceding paragraph within 365 days from the date of the receipt of such Net Proceeds shall constitute “ Excess Proceeds ”; provided that if during such 365-day period the Company or a Restricted Subsidiary enters into a definitive binding agreement committing it to apply such Net Proceeds in accordance with the requirements of Sections 4.10(c)(2) or (3) after such 365th day, such 365-day period will be extended with respect to the amount of Net Proceeds so committed for a period not to exceed 180 days until such Net Proceeds are required to be applied in accordance with such agreement (or, if earlier, until termination of such agreement).
(e) When the aggregate amount of Excess Proceeds exceeds $20.0 million, the Company or the applicable Restricted Subsidiary will make an Asset Sale Offer to all holders of Notes and Indebtedness that ranks pari passu with the Notes and contains provisions similar to those set forth in this Indenture with respect to offers to purchase with the proceeds of sales of assets to purchase, on a pro rata basis, provided , however , with such adjustments so that no Notes or pari passu Indebtedness are purchased in part in an unauthorized denomination, the maximum principal amount of Notes and such other Indebtedness that ranks pari passu with the Notes that may be purchased out of the Excess Proceeds. The offer price in any Asset Sale Offer will be equal to 100% of principal amount thereof, plus accrued and unpaid interest and Additional Interest, if any, to the date of purchase, and will be payable in cash.
(f) Pending the final application of any Net Proceeds, the Company or the applicable Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise invest the Net Proceeds in any manner that is not prohibited by this Indenture.
(g) If any Excess Proceeds remain after consummation of an Asset Sale Offer, the Company or the applicable Restricted Subsidiary may use those Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds, the Trustee will select the Notes to be purchased on a pro rata basis, provided , however , with such adjustments so that no
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Notes or pari passu Indebtedness are purchased in part in an unauthorized denomination. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.
(h) The Company or the applicable Restricted Subsidiary will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sale provisions of this Indenture, the Company or the applicable Restricted Subsidiary will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Asset Sale provisions of this Indenture by virtue of such conflict.
SECTION 4.11 Limitation on Transactions with Affiliates .
(a) The Company will not, and will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, assign, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate (each, an “ Affiliate Transaction ”) involving aggregate consideration in excess of $5.0 million, unless:
(1) the Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or Restricted Subsidiary with an unrelated Person; and
(2) with respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $15.0 million, a majority of the disinterested members of the Board of Directors of the Company have determined in good faith that the criteria set forth in Section 4.11(a)(1) are satisfied and have approved the relevant Affiliate Transaction as evidenced by a resolution of the Board of Directors of the Company.
(b) The following items will not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions of the prior paragraph:
(1) any transaction with the Company, a Restricted Subsidiary or joint venture or similar entity which would constitute an Affiliate Transaction solely because the Company or a Restricted Subsidiary owns an equity interest in or otherwise controls such Restricted Subsidiary, joint venture or similar entity;
(2) Restricted Payments and Permitted Investments permitted by this Indenture;
(3) the payment to the Sponsors, any of their Affiliates, and officers or Affiliates of the Company or any of its Restricted Subsidiaries, of management, consulting, monitoring and advisory fees, termination payments and related reasonable
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expenses pursuant to (A) the Management Agreement or any amendment thereto (so long as any such amendment is not less advantageous to the holders of the Notes in any material respect than the Management Agreement) or (B) other agreements as in effect on the Issue Date that are entered into in connection with the Transactions and as in effect on the Issue Date or any amendment thereto (so long as any such amendment is not less advantageous to the holders of the Notes in any material respect than the original agreement as in effect on the Issue Date);
(4) the payment of reasonable compensation and fees to, and indemnities provided on behalf of (and entering into related agreements with) officers, directors, employees or consultants of the Company, any of its direct or indirect parent corporations, or any Restricted Subsidiary, as determined in good faith by the Board of Directors of the Company or senior management thereof;
(5) payments made by the Company or any Restricted Subsidiary to the Sponsors and any of their Affiliates for any financial advisory, financing, underwriting or placement services or in respect of other investment banking activities, including, without limitation, in connection with acquisitions or divestitures, which payments are approved by a majority of the disinterested members of the Board of Directors of the Company in good faith;
(6) transactions in which the Company or any Restricted Subsidiary delivers to the Trustee a letter from an Independent Financial Advisor stating that such transaction is fair to the Company or such Restricted Subsidiary from a financial point of view;
(7) payments or loans (or cancellations of loans) to employees or consultants of the Company or any of its direct or indirect parent corporations or any Restricted Subsidiary which are approved by the Board of Directors of the Company and which are otherwise permitted under this Indenture, but in any event not to exceed $10.0 million in the aggregate outstanding at any one time;
(8) payments made or performance under any agreement as in effect on the Issue Date (other than the Management Agreement and Shareholders Agreement, but including, without limitation, each of the other agreements entered into in connection with the Transactions);
(9) the existence of, or the performance by the Company or any of its Restricted Subsidiaries of its obligations under the terms of, the Shareholders Agreement (including any registration rights agreement or purchase agreements related thereto to which it is a party on the Issue Date and any similar agreement that it may enter into thereafter); provided , however , that the existence of, or the performance by the Company or any of its Restricted Subsidiaries of its obligations under, any future amendment to the Shareholders Agreement or under any similar agreement entered into after the Issue Date shall only be permitted by this clause (9) to the extent that the terms of any such existing agreement together with all amendments thereto, taken as a whole, or new agreement are not otherwise more disadvantageous to holders of the Notes in any material respect than the original agreement as in effect on the Issue Date;
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(10) transactions with customers, clients, suppliers, or purchasers or sellers of goods or services (including Holdings and its Subsidiaries), in each case in the ordinary course of business and otherwise in compliance with the terms of this Indenture that are fair to the Company or its Restricted Subsidiaries, in the reasonable determination of the members of the Board of Directors of the Company or the senior management thereof, or are on terms at least as favorable as would reasonably have been entered into at such time with an unaffiliated party;
(11) if otherwise permitted hereunder, the issuance of Equity Interests (other than Disqualified Stock) of the Company to any Permitted Holder, any director, officer, employee or consultant of the Company or its Subsidiaries or any other Affiliates of the Company (other than a Subsidiary); and
(12) any transaction with a Securitization Subsidiary effected as part of a Qualified Securitization Financing.
SECTION 4.12 Limitation on Liens .
The Company will not, and will not permit any of its Restricted Subsidiaries that are Guarantors to, directly or indirectly, create, incur, assume or suffer to exist any Lien (other than any Permitted Lien) that secures obligations under any Indebtedness or, if applicable, any Guarantee on any asset or property of the Company or any Restricted Subsidiary, or any income or profits therefrom, or assign or convey any right to receive income therefrom, unless:
(1) in the case of Liens securing Indebtedness subordinated to the Notes or the Guarantees, the Notes and the Guarantees are secured by a Lien on such property, assets or proceeds that is senior in priority to such Liens; or
(2) in all other cases, the Notes and the Guarantees are equally and ratably secured.
SECTION 4.13 Payments for Consent .
The Company will not, and will not permit any of its Subsidiaries to, directly or indirectly, pay or cause to be paid any consideration to or for the benefit of any holder of Notes for or as an inducement to any consent, waiver or amendment of any of the terms or provisions of this Indenture or the Notes unless such consideration is offered to be paid and is paid to all holders of the Notes that so consent, waive or agree to amend in the time frame set forth in the solicitation documents relating to such consent, waiver or agreement.
SECTION 4.14 Offer to Purchase upon Change of Control .
If a Change of Control occurs, unless the Company at such time has given notice of redemption under Section 3.7 with respect to all outstanding Notes, each holder of Notes will have the right to require the Company to repurchase all or any part (equal to $2,000 or an integral multiple of $1,000 in excess thereof) of that holder’s Notes pursuant to a Change of Control Offer on the terms set forth in this Indenture. In the Change of Control Offer, the
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Company will offer a payment (a “ Change of Control Payment ”) in cash equal to 101% of the aggregate principal amount of Notes repurchased plus accrued and unpaid interest and Additional Interest, if any, on the Notes repurchased, to the date of purchase. Within 30 days following any Change of Control, unless the Company at such time has given notice of redemption under Section 3.7 with respect to all outstanding Notes, the Company will mail a notice to each holder describing the transaction or transactions that constitute the Change of Control and offering to repurchase Notes on the date of such Change of Control Payment specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is mailed, pursuant to the procedures required by this Indenture and described in such notice.
The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control provisions of this Indenture, the Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control provisions of this Indenture by virtue of such conflict.
On the date of such Change of Control Payment, the Company will, to the extent lawful:
(1) accept for payment all Notes or portions of Notes properly tendered pursuant to the Change of Control Offer;
(2) deposit with the paying agent an amount equal to the Change of Control Payment in respect of all Notes or portions of Notes properly tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions of Notes being purchased by the Company.
The paying agent will promptly mail to each holder of Notes properly tendered the Change of Control Payment for such Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each 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 minimum principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. The Company will publicly announce the results of the Change of Control Offer on or as soon as practicable after the date of such Change of Control Payment.
The Company will not be required to make a Change of Control Offer upon a Change of Control if (i) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Indenture applicable to a Change of Control Offer made by the Company and purchases all Notes properly tendered and not withdrawn under the Change of Control Offer or (ii) a notice of redemption has been given pursuant to Section 3.7 of this Indenture unless and until there is a default in the payment of the applicable redemption price. A Change of Control Offer may be made in advance of a Change
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of Control or conditional upon the occurrence of a Change of Control, if a definitive agreement is in place for the Change of Control at the time the Change of Control Offer is made.
The provisions described above that require the Company to make a Change of Control Offer following a Change of Control will be applicable whether or not any other provisions of this Indenture are applicable. Except as described above with respect to a Change of Control, this Indenture does not contain provisions that permit the holders of the Notes to require that the Company repurchase or redeem the Notes in the event of a takeover, recapitalization or similar transaction.
SECTION 4.15 Corporate Existence .
Subject to Section 4.14 and Article V hereof, as the case may be, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the corporate, partnership, limited liability company or other existence of each of its Subsidiaries in accordance with the respective organizational documents (as the same may be amended from time to time) of the Company or any such Subsidiary and the rights (charter and statutory), licenses and franchises of the Company and its Subsidiaries; provided that the Company shall not be required to preserve any such right, license or franchise, or the corporate, partnership or other existence of any of its Subsidiaries, if the Board of Directors of the Company shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and its Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any material respect to the Holders.
SECTION 4.16 Business Activities .
The Company will not, and will not permit any Restricted Subsidiary to, engage in any business other than Permitted Businesses, except to such extent as would not be material to the Company and its Subsidiaries taken as a whole.
SECTION 4.17 Additional Guarantees .
After the Issue Date, the Company will cause (i) each of its Domestic Subsidiaries (other than any Unrestricted Subsidiary) that incurs any Indebtedness in excess of $10.0 million (other than Indebtedness permitted to be incurred pursuant to Section 4.9(b)(5) , (6) , (7) , (8) , (9) , (10) and (15) and (ii) each Restricted Subsidiary that guarantees any Indebtedness of the Company or any of the Guarantors, in each case, within 10 business days of such incurrence of any such Indebtedness or guarantee of such Indebtedness, to execute and deliver to the Trustee a supplement to this Indenture pursuant to which such Restricted Subsidiary will unconditionally Guarantee, on a joint and several basis, the full and prompt payment of the principal of, premium, if any and interest on the Notes and all other obligations under this Indenture on the same terms and conditions as those set forth in this Indenture.
Each Guarantee will be limited to an amount not to exceed the maximum amount that can be guaranteed by that Restricted Subsidiary without rendering the Guarantee, as it relates to such Restricted Subsidiary, voidable under applicable law relating to fraudulent conveyance or fraudulent transfer or similar laws affecting the rights of creditors generally.
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SECTION 4.18 [Reserved].
SECTION 4.19 Further Instruments and Acts .
The Company shall execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purposes of this Indenture, or as it may be requested by the Trustee.
SECTION 4.20 Suspension of Covenants
(a) During any period of time after the Issue Date that (i) the Notes are rated Investment Grade by each of S&P and Moody’s (or, if either (or both) of S&P and Moody’s have been substituted in accordance with the definition of “Rating Agencies,” by each of the then applicable Rating Agencies) and (ii) no Default has occurred and is continuing under this Indenture (the occurrence of the events described in the foregoing clauses (i) and (ii) being collectively referred to as a “ Covenant Suspension Event ”), the Company and its Restricted Subsidiaries will not be subject to Sections 4.7 , 4.8 , 4.9 , 4.10 , 4.11, 4.16 and 5.1(a)(iv) hereof (collectively, the “ Suspended Covenants ”).
(b) During any Suspension Period, the Company may not designate any of its Restricted Subsidiaries as Unrestricted Subsidiaries pursuant to the second sentence of the definition of “Unrestricted Subsidiary.”
(c) In the event that the Company and its Restricted Subsidiaries are not subject to the Suspended Covenants for any period of time as a result of the foregoing, and on any subsequent date (the “ Reversion Date ”) the condition set forth in Section 4.20(a)(i) is no longer satisfied, then Holdings and its Restricted Subsidiaries will thereafter again be subject to the Suspended Covenants with respect to future events. The period of time between the date of the Covenant Suspension Event and the Reversion Date is a “ Suspension Period. ”
On each Reversion Date, all Indebtedness incurred during the Suspension Period prior to such Reversion Date will be deemed to be Indebtedness permitted to be incurred under Section 4.9(b)(3). For purposes of calculating the amount available to be made as Restricted Payments under Section 4.7(3) , calculations under such covenant shall be made as though such covenant had been in effect during the entire period of time after the Issue Date (including the Suspension Period). Restricted Payments made during the Suspension Period not otherwise permitted pursuant to the second paragraph of Section 4.7 hereof will reduce the amount available to be made as Restricted Payments under Section 4.7(3) .
ARTICLE V
SUCCESSORS
SECTION 5.1 Consolidation, Merger, Conveyance, Transfer or Lease .
(a) The Company may not, directly or indirectly: (1) consolidate or merge with or into another Person (whether or not the Company is the surviving corporation); or (2) sell,
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assign, transfer, convey, lease or otherwise dispose of all or substantially all of the properties or assets of the Company and its Restricted Subsidiaries, taken as a whole, in one or more related transactions, to another Person; unless:
(i)(A) the Company is the surviving corporation; or (B) the Person formed by or surviving any such consolidation or merger (if other than the Company) or to which such sale, assignment, transfer, conveyance, lease or other disposition has been made is a corporation or limited liability company organized or existing under the laws of the United States, any state of the United States or the District of Columbia (the Company or such Person, including the Person to which such sale, assignment, transfer, conveyance, lease or other disposition has been made, as the case may be, being herein called the “ Successor Company ”);
(ii) the Successor Company (if other than the Company) assumes all the obligations of the Company pursuant to agreements necessary under the terms of the Notes, the Indenture and the Registration Rights Agreement;
(iii) immediately after such transaction, no Default or Event of Default exists; and
(iv) immediately after giving pro forma effect to such transaction and any related financing transactions, as if the same had occurred at the beginning of the Applicable Four-Quarter Period, either (A) the Successor Company would be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test set forth in Section 4.9(a) or (B) the Fixed Charge Coverage Ratio for the Successor Company and its Restricted Subsidiaries would be greater than such ratio for the Company and its Restricted Subsidiaries immediately prior to such transaction.
(b) For purposes of this covenant, the sale, lease, conveyance, assignment, transfer or other disposition of all or substantially all of the properties and assets of one or more Restricted Subsidiaries of the Company, which properties and assets, if held by the Company instead of such Restricted Subsidiaries, would constitute all or substantially all of the properties and assets of the Company on a consolidated basis, shall be deemed to be the sale, lease, conveyance, assignment, transfer or other disposition of all or substantially all of the properties and assets of the Company.
(c) The predecessor company will be released from its obligations under the Indenture and the Successor Company will succeed to, and be substituted for, and may exercise every right and power of, the Company under the Indenture, but, in the case of a lease of all or substantially all its assets, the predecessor will not be released from the obligation to pay the principal of and interest on the Notes.
(d) This Section 5.1 will not apply to a sale, assignment, transfer, conveyance, lease or other disposition of assets between or among the Company and its Restricted Subsidiaries. Notwithstanding the foregoing, Section 5.1(a)(iii) and (iv) will not be applicable to (1) any Restricted Subsidiary consolidating with, merging into or selling, assigning, transferring, conveying, leasing or otherwise disposing of all or part of its properties and assets to the Company or to another Restricted Subsidiary and (2) the Company merging with an Affiliate
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solely for the purpose of reincorporating the Company, as the case may be, in another jurisdiction.
SECTION 5.2 Successor Corporation Substituted .
Upon any consolidation or merger, or any sale, assignment, transfer, lease, conveyance or other disposition of all or substantially all of the assets of the Company in accordance with Section 5.1 hereof, the successor corporation formed by such consolidation or into or with which the Company is merged or to which such sale, assignment, transfer, lease, conveyance or other disposition is made shall succeed to, and be substituted for (so that from and after the date of such consolidation, merger, sale, lease, conveyance or other disposition, the provisions of this Indenture referring to the “Company” shall refer instead to the successor corporation and not to the Company), and shall exercise every right and power of, the Company under this Indenture with the same effect as if such successor Person had been named as the Company herein.
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.1 Events of Default .
Each of the following constitutes an “ Event of Default ”:
(1) the Company defaults in payment when due and payable, upon redemption, acceleration or otherwise, of principal of, or premium, if any, on the Notes;
(2) the Company defaults in the payment when due of interest or Additional Interest, if any, on or with respect to the Notes and such default continues for a period of 30 days;
(3) the Company defaults in the performance of, or breaches any covenant, warranty or other agreement contained in, this Indenture (other than a default in the performance or breach of a covenant, warranty or agreement which is specifically dealt with in clauses (1) or (2) above) and such default or breach continues for a period of 60 days after notice from the Trustee or the Holders of at least 25% in aggregate principal amount of the outstanding Notes;
(4) a default under any mortgage, indenture or instrument under which there is issued or by which there is secured or evidenced any Indebtedness for money borrowed by the Company or any Restricted Subsidiary or the payment of which is guaranteed by the Company or any Restricted Subsidiary (other than Indebtedness owed to the Company or a Restricted Subsidiary), whether such Indebtedness or guarantee now exists or is created after the Issue Date, if (A) such default either (1) results from the failure to pay any such Indebtedness at its stated final maturity (after giving effect to any applicable grace periods) or (2) relates to an obligation other than the obligation to pay principal of any such Indebtedness at its stated final maturity and results in the holder or holders of such Indebtedness causing such Indebtedness to become due prior to its stated maturity
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and (B) the principal amount of such Indebtedness, together with the principal amount of any other such Indebtedness in default for failure to pay principal at stated final maturity (after giving effect to any applicable grace periods), or the maturity of which has been so accelerated, aggregate $50.0 million (or its foreign currency equivalent) or more at any one time outstanding;
(5) the failure by the Company or any Significant Subsidiary to pay final judgments aggregating in excess of $50.0 million (other than any judgments covered by indemnities or insurance policies issued by reputable and creditworthy companies), which final judgments remain unpaid, undischarged and unstayed for a period of more than 60 days after the applicable judgment becomes final;
(6) the Guarantee of a Significant Subsidiary that is a Guarantor or any group of Subsidiaries that are Guarantors and that, taken together as of the date of the most recent audited financial statements of the Company, would constitute a Significant Subsidiary ceases to be in full force and effect (except as contemplated by the terms hereof) or any Guarantor denies or disaffirms its obligations under this Indenture or any Guarantee(s), other than by reason of the release of the Guarantee(s) in accordance with the terms of this Indenture, and such Default continues for 30 days; and
(7)(i) the Company, any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken as a whole, would constitute a 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 property,
(d) makes a general assignment for the benefit of its creditors, or
(e) generally is not paying its debts as they become due;
(ii) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(a) is for relief against the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary, in an involuntary case;
(b) appoints a custodian of the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken
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together, would constitute a Significant Subsidiary or for all or substantially all of the property of the Company or any of its Restricted Subsidiaries; or
(c) orders the liquidation of the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary and the order or decree remains unstayed and in effect for 60 consecutive days.
SECTION 6.2 Acceleration .
If an Event of Default (other than an Event of Default specified in clause (7) above with respect to the Company) shall occur and be continuing, then and in every such case the Trustee or the Holders of at least 25% in aggregate principal amount of the outstanding Notes may declare the principal of the Notes and any accrued interest on the Notes to be due and payable by a notice in writing to the Company and the Trustee specifying the respective Event of Default and that it is a “notice of acceleration” (the “ Acceleration Notice ”), and the same shall become immediately 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. 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, under certain circumstances, rescind and annul such acceleration if all Events of Default, other than the nonpayment of accelerated principal of or interest on such Notes, have been cured or waived as provided in this Indenture.
The Holders of a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under this Indenture and its consequences:
(1) if the rescission would not conflict with any judgment or decree;
(2) if all existing Events of Default have been cured or waived except nonpayment of principal or interest that has become due solely because of the acceleration;
(3) to the extent the payment of such interest is lawful, interest on overdue installments of interest and overdue principal, which has become due otherwise than by such declaration of acceleration, has been paid;
(4) if the Company has paid the Trustee its reasonable compensation and reimbursed the Trustee for its expenses, disbursements and advances; and
(5) in the event of the cure or waiver of an Event of Default of the type described in clause (7) of Section 6.1 , the Trustee shall have received an Officers’ Certificate and an opinion of counsel that such Event of Default has been cured or waived.
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No such rescission shall affect any subsequent Default or impair any right consequent thereto.
In the event of any Event of Default specified in clause (4) of Section 6.1 , such Event of Default and all consequences thereof (excluding, however, any resulting payment default) will be annulled, waived and rescinded, automatically and without any action by the Trustee or the holders of the Notes, if within 30 days after such Event of Default arose the Company delivers an Officers’ Certificate to the Trustee stating that (x) the Indebtedness or guarantee that is the basis for such Event of Default has been discharged or (y) the holders thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving rise to such Event of Default or (z) the default that is the basis for such Event of Default has been cured, it being understood that in no event shall an acceleration of the principal amount of the Notes as described above be annulled, waived or rescinded upon the happening of any such events.
If an Event of Default specified in clause (7) above with respect to the Company occurs and is continuing, then all unpaid principal of, and premium, if any, and accrued and unpaid interest and Additional Interest, if any, on all of the outstanding Notes shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any holder of the Notes.
No Holder of any Note will have any right to institute any proceeding with respect to this Indenture or for any remedy thereunder, unless such Holder shall have previously given to the Trustee written notice of a continuing Event of Default and unless also the Holders of at least 25% in aggregate principal amount of the outstanding Notes shall have made written request, and offered reasonable indemnity, to the Trustee to institute such proceeding as Trustee, and the Trustee shall not have received from the Holders of a majority in aggregate principal amount of the outstanding Notes a direction inconsistent with such request and shall have failed to institute such proceeding within 60 days. Such limitations do not apply, however, to a suit instituted by a Holder of a Note for enforcement of payment of the principal of (and premium, if any) or interest on such Note on or after the respective due dates expressed in such Note.
In the case of any Event of Default occurring by reason of any willful action (or inaction) taken (or not taken) by or on behalf of the Company with the intention of avoiding payment of the premium that the Company would have had to pay if the Company then had elected to redeem the Notes pursuant to Section 3.7 , an equivalent premium shall also become and be immediately due and payable to the extent permitted by law upon the acceleration of the Notes.
SECTION 6.3 Other Remedies .
If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy to collect the payment of principal, premium, if any, interest and Additional Interest, if any, on the Notes or to enforce the performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the
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right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law.
SECTION 6.4 Waiver of Past Defaults .
The Holders of a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default or Event of Default and its consequences under this Indenture except a continuing Default or Event of Default in the payment of interest on, or the principal of, the Notes (other than as a result of an acceleration), which shall require the consent of all of the Holders of the Notes then outstanding.
SECTION 6.5 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 exercising any remedy available to the Trustee or exercising any trust power conferred on it. However, (i) the Trustee may refuse to follow any direction that conflicts with law or this Indenture, that the Trustee determines may be unduly prejudicial to the rights of other Holders or that may involve the Trustee in personal liability, and (ii) the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. In case an Event of Default shall occur (which shall not be cured), the Trustee will be required, in the exercise of its power, to use the degree of care of a prudent man in the conduct of his own affairs. Notwithstanding any provision to the contrary in this Indenture, the Trustee is under no obligation to exercise any of its rights or powers under this Indenture at the request of any Holder, unless such Holder shall offer to the Trustee security and indemnity satisfactory to it against any loss, liability or expense.
SECTION 6.6 Limitation on Suits .
A Holder may pursue a remedy with respect to this Indenture or the Notes only if:
(a) the Holder gives to the Trustee written notice of a continuing Event of Default or the Trustee receives such notice from the Company;
(b) the Holders of at least 25% in aggregate principal amount of the then outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder or Holders offer and, if requested, provide to the Trustee indemnity or security reasonably satisfactory to the Trustee against any loss, liability or expense;
(d) the Trustee does not comply with the request within 60 days after receipt of the request and the offer and, if requested, the provision of such indemnity or security; and
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(e) during such 60-day period the Holders of a majority in aggregate principal amount of the then outstanding Notes do not give the Trustee a direction inconsistent with the request.
A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder.
SECTION 6.7 Rights of Holders of Notes to Receive Payment .
Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of principal, premium, if any, and interest on or after the respective due dates expressed in the Note (including in connection with an offer to purchase), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of such Holder.
SECTION 6.8 Collection Suit by Trustee .
If an Event of Default specified in Section 6.1(1) or (2) hereof occurs and is continuing, the Trustee is authorized to recover judgment in its own name and as trustee of an express trust against the Company for the whole amount of principal of, premium and interest remaining unpaid on the Notes and interest on overdue principal and, to the extent lawful, interest and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.9 Trustee May File Proofs of Claim .
The Trustee is authorized to 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 (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Company (or any other obligor upon the Notes), its creditors or its property and shall be entitled and empowered to collect, receive and distribute any money or other securities or property payable or deliverable upon the conversion or exchange of the Notes or on any such claims 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 7.7 hereof. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 7.7 hereof out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes
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or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10 Priorities .
If the Trustee collects any money or property pursuant to this Article VI, it shall pay out the money and property in the following order:
First: to the Trustee, its agents and attorneys for amounts due under Section 7.7 hereof, including payment of all reasonable compensation, expense and liabilities incurred, and all advances that may have been made, by the Trustee and the costs and expenses of collection;
Second: to Holders of Notes for amounts due and unpaid on the Notes for principal, premium, if any, and interest and Additional Interest ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal, premium, if any, and interest and Additional Interest, respectively;
Third: without duplication, to the Holders for any other Obligations owing to the Holders under this Indenture and the Notes; and
Fourth: to the Company or to such party as a court of competent jurisdiction shall direct.
The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10 .
SECTION 6.11 Undertaking for Costs .
In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.7 hereof, or a suit by Holders of more than 10% in principal amount of the then outstanding Notes.
ARTICLE VII
TRUSTEE
SECTION 7.1 Duties of Trustee .
(a) If an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture and use the same degree of care and
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skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the express provisions of this Indenture or the TIA and the Trustee need perform only those duties that are specifically set forth in this Indenture or the TIA and no others, and no implied covenants or obligations shall be read into this Indenture against the Trustee; and
(ii) 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 need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).
However, the Trustee shall examine the certificates and opinions furnished to it to determine whether or not they conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of this Section 7.1 ;
(ii) the Trustee shall not be liable for any error of judgment made in good faith by an officer of the Trustee, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.5 hereof.
(d) Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.1 .
(e) No provision of this Indenture shall require the Trustee to expend or risk its own funds or incur any liability. The Trustee shall be under no obligation to exercise any of its rights and powers under this Indenture at the request of any Holders, unless such Holder shall have offered to the Trustee security and indemnity satisfactory to it against any loss, liability or expense.
(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 Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.
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SECTION 7.2 Rights of Trustee .
(a) The Trustee may conclusively rely and shall be fully protected in acting or refraining from acting on any document (whether in original or facsimile form) 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.
(b) Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate or an Opinion of Counsel or both. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate or Opinion of Counsel. Prior to taking, suffering or admitting any action, the Trustee may consult with counsel of the Trustee’s own choosing and the Trustee shall be fully protected from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in conclusive reliance on the advice or opinion of such counsel.
(c) The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any attorney or agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this Indenture. Any request or direction of the Company mentioned herein shall be sufficiently evidenced by an Officers’ Certificate and any resolution of the Board of Directors may be sufficiently evidenced by a Board Resolution. Whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, conclusively rely upon an Officers’ Certificate.
(e) Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Company or a Guarantor shall be sufficient if signed by an officer of the Company or such Guarantor.
(f) The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders unless such Holders shall have offered to the Trustee reasonable security or indemnity satisfactory to the Trustee against the costs, expenses and liabilities that might be incurred by it in compliance with such request or direction.
(g) The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or documents, 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 to examine during normal business hours the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company, and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.
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(h) The rights, privileges, protections and benefits given to the Trustee, including, without limitation, its rights 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 Persons employed to act hereunder.
(i) The Trustee may request that the Company deliver an Officers’ Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture, which Officers’ Certificate may be signed by any person authorized to sign an Officers’ Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded.
(j) The Trustee shall not be deemed to have notice or be charged with knowledge of any Default or Event of Default unless the Trustee shall have received from the Company or any other obligor upon the Notes or from any Holder written notice thereof at its address set forth in Section 12.2 hereof, and such notice references the Notes and this Indenture. In the absence of any such notice, the Trustee may conclusively assume that no such Default or Event of Default exists.
SECTION 7.3 Individual Rights of Trustee .
The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee. However, in the event that the Trustee acquires any conflicting interest it must eliminate such conflict within 90 days, apply to the Commission for permission to continue as Trustee or resign. Any Agent may do the same with like rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof.
SECTION 7.4 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, it shall not be accountable for the Company’s use of the proceeds from the Notes or any money paid to the Company’s or upon the Company’s direction under any provision of this Indenture, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the Notes, any statement or recital on any Officers’ Certificate delivered to the Trustee under Article IV or Section 8.4 or 9.6 hereof, or any other document in connection with the sale of the Notes or pursuant to this Indenture other than its certificate of authentication.
SECTION 7.5 Notice of Defaults .
If a Default or Event of Default occurs and is continuing and if it is actually known to an officer of the Trustee directly responsible for the administration of this Indenture, the Trustee shall mail to Holders a notice of the Default or Event of Default within 90 days after it occurs or as soon as practicable after it is known if after 90 days after it occurs. Except in the case of a Default or Event of Default in payment of principal of, premium, if any, or interest or Additional Interest on any Note, the Trustee may withhold the notice if and so long as the board of directors,
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the executive committee or a trust committee of directors or Responsible Officers of the Trustee in good faith determines that withholding the notice is in the interests of the Holders.
SECTION 7.6 Reports by Trustee to Holders of the Notes .
Within 60 days after each May 15 beginning with May 15, 2012, and for so long as Notes remain outstanding, the Trustee shall mail to the Holders a brief report dated as of such reporting date that complies with TIA § 313(a) (but if no event described in TIA § 313(a) has occurred within the twelve months preceding the reporting date, no report need be transmitted). The Trustee also shall comply with TIA § 313(b). The Trustee shall also transmit by mail all reports as required by TIA § 313(c).
A copy of each report at the time of its mailing to the Holders shall be mailed to the Company and filed with the Commission and each stock exchange on which the Company has informed the Trustee in writing the Notes are listed in accordance with TIA § 313(d). The Company shall promptly notify the Trustee when the Notes are listed on any stock exchange and of any delisting thereof.
SECTION 7.7 Compensation and Indemnity .
The Company shall pay to the Trustee from time to time compensation for its acceptance of this Indenture and services hereunder as agreed upon in writing. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee promptly upon request for all reasonable disbursements, advances and expenses incurred or made by it in addition to the compensation for its services. Such expenses shall include the reasonable compensation, disbursements and expenses of the Trustee’s agents and counsel.
The Company and the Guarantors, jointly and severally, shall indemnify the Trustee (which for purposes of this Section 7.7 shall include its officers, directors, employees and agents) against any and all claims, damage, losses, liabilities or expenses incurred by it arising out of or in connection with the acceptance or administration of its duties under this Indenture, including the costs and expenses of enforcing this Indenture against the Company (including this Section 7.7 ) and defending itself against any claim (whether asserted by the Company or any Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder except to the extent any such loss, claim, damage, liability or expense may be attributable to its negligence or bad faith. The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim and the Trustee shall cooperate in the defense. The Trustee may have separate counsel and the Company shall pay the reasonable fees and expenses of one such counsel. The Company need not pay for any settlement made without its consent, which consent shall not be unreasonably withheld.
The obligations of the Company and the Guarantors under this Section 7.7 shall survive the satisfaction and discharge of this Indenture or the resignation or removal of the Trustee.
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To secure the Company’s payment obligations in this Section 7.7 , the Trustee shall have a Lien prior to the Notes on all money or property held or collected by the Trustee, except that held in trust to pay principal or interest, if any, on particular Notes. Such Lien shall survive the satisfaction and discharge of this Indenture and the resignation or removal of the Trustee.
When the Trustee incurs expenses or renders services after an Event of Default specified in Section 6.1(7) hereof occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA § 313(b)(2) to the extent applicable.
SECTION 7.8 Replacement of Trustee .
A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section 7.8 .
The Trustee may resign in writing at any time and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in principal amount of the then outstanding Notes may remove the Trustee by so notifying the Trustee and the Company in writing. The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its property; or
(d) the Trustee 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 Company shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the then outstanding Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, the Company or the Holders of at least 10% in principal amount of the then outstanding Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee.
If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.10 hereof, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.
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A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and the duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to the Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee, provided that all sums owing to the Trustee hereunder have been paid and subject to the Lien provided for in Section 7.7 hereof. Notwithstanding replacement of the Trustee pursuant to this Section 7.8 , the Company’s and the Guarantors’ obligations under Section 7.7 hereof shall continue for the benefit of the retiring Trustee.
SECTION 7.9 Successor Trustee by Merger, Etc .
If the Trustee or any Agent consolidates, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the successor corporation without any further act shall be the successor Trustee or any Agent, as applicable.
SECTION 7.10 Eligibility; Disqualification .
There shall at all times be a Trustee hereunder that is a corporation organized and doing business under the laws of the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power and that is subject to supervision or examination by federal or state authorities. The Trustee together with its affiliates shall at all times have a combined capital surplus of at least $50.0 million as set forth in its most recent annual report of condition.
This Indenture shall always have a Trustee who satisfies the requirements of TIA §§ 310(a)(l), (2) and (5). The Trustee is subject to TIA § 310(b) including the provision in § 310(b)(1); provided that there shall be excluded from the operation of TIA § 310(b)(1) any indenture or indentures under which other securities, or conflicts of interest or participation in other securities, of the Company or the Guarantors are outstanding if the requirements for exclusion set forth in TIA § 310(b)(1) are met.
SECTION 7.11 Preferential Collection of Claims Against the Company .
The Trustee is subject to 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 Trustee’s Application for Instructions from the Company .
Any application by the Trustee for written instructions from the Company may, at the option of the Trustee, set forth in writing any action proposed to be taken or omitted by the Trustee under this Indenture and the date on and/or after which such action shall be taken or such omission shall be effective. The Trustee shall not be liable for any action taken by, or omission of, the Trustee in accordance with a proposal included in such application on or after the date specified in such application (which date shall not be less than twenty Business Days after the date any officer of the Company actually receives such application, unless any such officer shall
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have consented in writing to any earlier date) unless prior to taking any such action (or the effective date in the case of an omission), the Trustee shall have received written instructions in response to such application specifying the action to be taken or omitted.
ARTICLE VIII
DEFEASANCE; DISCHARGE OF THE INDENTURE
SECTION 8.1 Option to Effect Legal Defeasance or Covenant Defeasance .
The Company may, at the option of its Board of Directors and evidenced by a Board Resolution set forth in an Officers’ Certificate, at any time, elect to have either Section 8.2 or 8.3 hereof applied to all outstanding Notes upon compliance with the conditions set forth below in this Article VIII.
SECTION 8.2 Legal Defeasance .
Upon the Company’s exercise under Section 8.1 hereof of the option applicable to this Section 8.2 , The Company shall, subject to the satisfaction of the conditions set forth in Section 8.4 hereof, be deemed to have been discharged from its obligations with respect to all outstanding Notes on the date the conditions set forth below are satisfied (hereinafter, “ Legal Defeasance ”). For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes, which shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.5 hereof and the other Sections of this Indenture referred to in (a) and (b) below, and to have satisfied all of its other obligations under such Notes and this Indenture (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder: (a) the rights of Holders of outstanding Notes to receive payments in respect of the principal of, premium and Additional Interest, if any, and interest, if any, on such Notes when such payments are due from the trust referred to in Section 8.4(1) ; (b) the Company’s obligations with respect to such Notes under Sections 2.2 , 2.3 , 2.4 , 2.5 , 2.6 , 2.7 , 2.10 and 4.2 hereof; (c) the rights, powers, trusts, benefits and immunities of the Trustee, including without limitation thereunder, under Section 7.7 , 8.5 and 8.7 hereof and the Company’s obligations in connection therewith; (d) the Company’s rights pursuant to Section 3.7 ; and (e) the provisions of this Article VIII. Subject to compliance with this Article VIII, the Company may exercise its option under this Section 8.2 notwithstanding the prior exercise of its option under Section 8.3 hereof.
SECTION 8.3 Covenant Defeasance .
Upon the Company’s exercise under Section 8.1 hereof of the option applicable to this Section 8.3 , the Company shall, subject to the satisfaction of the conditions set forth in Section 8.4 hereof, be released from its obligations under the covenants contained in Sections 4.3 , 4.7 , 4.8 , 4.9 , 4.10 , 4.11 , 4.12 , 4.13 , 4.14 , 4.15 (but only with respect to Subsidiaries), 4.16 , 4.17 , 4.18 , 4.20 and 5.1 hereof with respect to the outstanding Notes on and after the date the conditions set forth below are satisfied (hereinafter, “ Covenant Defeasance ”), and the Notes shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act
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of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding for accounting purposes). For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes, the Company or any of its Subsidiaries may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.1 hereof, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby. In addition, upon the Company’s exercise under Section 8.1 hereof of the option applicable to this Section 8.3 , subject to the satisfaction of the conditions set forth in Section 8.4 hereof, Sections 6.1(4) , (5) , (6) and (7) hereof shall not constitute Events of Default.
Notwithstanding any discharge or release of any obligations pursuant to Section 8.2 or 8.3 , the Company’s obligations in Sections 2.5 , 2.6 , 2.7 , 2.8 , 7.7 , 8.6 and 8.7 shall survive until the Notes are no longer outstanding pursuant to the last paragraph of Section 2.8 . After the Notes are no longer outstanding, the Company’s obligations in Sections 7.7 , 8.6 and 8.7 shall survive.
SECTION 8.4 Conditions to Legal or Covenant Defeasance .
The following shall be the conditions to the application of either Section 8.2 or 8.3 hereof to the outstanding Notes:
(1) the Company must irrevocably deposit with the Trustee, in trust, for the benefit of the holders of the Notes issued hereunder, cash in U.S. dollars, non-callable U.S. Government Securities, or a combination of cash in U.S. dollars and non-callable U.S. Government Securities, in amounts as will be sufficient, in the opinion of a nationally recognized investment bank, appraisal firm or firm of independent public accountants, to pay the principal of, or interest and premium and Additional Interest, if any, on the outstanding Notes issued hereunder on the stated maturity or on the applicable redemption date, as the case may be, and the Company must specify whether the Notes are being defeased to maturity or to a particular redemption date;
(2) in the case of Legal Defeasance, the Company has delivered to the Trustee an opinion of counsel reasonably acceptable to the Trustee confirming that (a) the Company has received from, or there has been published by, the Internal Revenue Service a ruling or (b) since the date of this Indenture, there has been a change in the applicable federal income tax law, in either case to the effect that, and based thereon such opinion of counsel will confirm that, the holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Legal Defeasance and will be subject to 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;
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(3) in the case of Covenant Defeasance, the Company has delivered to the Trustee an opinion of counsel reasonably acceptable to the Trustee confirming that the holders of the outstanding Notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
(4) no Event of Default has occurred and is continuing on the date of such deposit (other than an Event of Default resulting from the borrowing of funds to be applied to such deposit and the grant of any Lien securing such borrowings) or, insofar as Events of Default resulting from the borrowing of funds or insolvency events are concerned, at any time in the period ending on the 91st day after the date of deposit;
(5) such Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under any material agreement or instrument (other than this Indenture) to which the Company or any Guarantor are a party or by which the Company or any Guarantor is bound;
(6) the Company must deliver to the Trustee an Officers’ Certificate stating that the deposit was not made by the Company with the intent of preferring the holders of Notes over the other creditors of the Company or any Guarantor or with the intent of defeating, hindering, delaying or defrauding creditors of the Company or any Guarantor or others; and
(7) the Company must deliver to the Trustee an Officers’ Certificate and an Opinion of Counsel (which may be subject to certain qualifications), each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance have been complied with.
Notwithstanding the foregoing, the requirements of clause (2) above with respect to a Legal Defeasance need not be complied with if all Notes not theretofore delivered to the Trustee for cancellation (x) have become due and payable or (y) will become due and payable on the maturity date within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company.
SECTION 8.5 Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions.
Subject to Section 8.6 hereof, all money and non-callable Government Securities (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.5 , the “ Trustee ”) pursuant to Section 8.4 hereof in respect of the outstanding Notes shall be held in trust, shall not be invested, 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 (including the Company or any Subsidiary acting as Paying Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal, premium, if any, and interest and Additional Interest,
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if any, but such money need not be segregated from other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or non-callable Government Securities deposited pursuant to Section 8.4 hereof or the principal 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 VIII to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the written request of the Company and be relieved of all liability with respect to any money or non-callable Government Securities held by it as provided in Section 8.4 hereof which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (which may be the opinion delivered under Section 8.4(1) hereof), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
SECTION 8.6 Repayment to Company .
Subject to any applicable abandoned property laws, any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium, if any, or interest or Additional Interest, if any, on any Note and remaining unclaimed for one year after such principal and premium, if any, or interest or Additional Interest has become due and payable shall be paid to the Company on its written request or (if then held by the Company) shall be discharged from such trust; and the Holder of such Note shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided , however , that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in the New York Times and The Wall Street Journal (national edition), 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 notification or publication, any unclaimed balance of such money then remaining shall be repaid to the Company.
SECTION 8.7 Reinstatement .
If the Trustee or Paying Agent is unable to apply any United States dollars or non-callable Government Securities in accordance with Section 8.2 , 8.3 or 8.8 hereof, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the obligations of the Company under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.2 , 8.3 or 8.8 hereof until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.2 , 8.3 or 8.8 hereof, as the case may be; provided , however , that, if the Company makes any payment of principal of, premium, if any, or interest on any Note following the reinstatement of its obligations, the Company shall be
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subrogated to the rights of the Holders of such Notes to receive such payment from the money held by the Trustee or Paying Agent.
SECTION 8.8 Discharge .
The Company and the Guarantors may terminate the obligations under this Indenture and the Notes when:
(1) either:
(a) all Notes that have been authenticated, except lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has been deposited in trust and thereafter repaid to the Company, have been delivered to the Trustee for cancellation; or
(b) all Notes that have not been delivered to the Trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or will become due and payable by reason of the mailing of a notice of redemption or otherwise within one year and the Company has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the holders of the Notes, cash in U.S. dollars, non-callable U.S. Government Securities, or a combination thereof, in amounts as will be sufficient without consideration of any reinvestment of interest, to pay and discharge the entire Indebtedness on the Notes not delivered to the Trustee for cancellation for principal, premium and Additional Interest, if any, and accrued interest to the date of maturity or redemption;
(2) no Event of Default has occurred and is continuing on the date of the deposit or will occur as a result of the deposit (other than a Default resulting from borrowing of funds to be applied to such deposit and the grant of any Lien securing such borrowing) and the deposit will not result in a breach or violation of, or constitute a default under, any other material instrument to which the Company is a party or by which the Company is bound;
(3) the Company has paid or caused to be paid all sums payable by it under this Indenture; and
(4) the Company has delivered irrevocable instructions to the Trustee under this Indenture to apply the deposited money toward the payment of the Notes at maturity or the redemption date, as the case may be.
In addition, the Company must deliver an Officers’ Certificate and an Opinion of Counsel to the Trustee stating that all conditions precedent to satisfaction and discharge have been satisfied.
In the case of clause (1)(b) of this Section 8.8 , and subject to the next sentence and notwithstanding the foregoing paragraph, the Company’s obligations in Sections 2.5 , 2.6 , 2.7 ,
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2.8 , 4.1 , 4.2 , 4.15 (as to legal existence of the Company only), 7.7 , 8.6 and 8.7 shall survive until the Notes are no longer outstanding pursuant to the last paragraph of Section 2.8 . After the Notes are no longer outstanding, the Company’s obligations in Sections 7.7 , 8.6 and 8.7 shall survive any discharge pursuant to Section 8.8 .
After such delivery or irrevocable deposit, the Trustee upon request shall acknowledge in writing the discharge of the Company’s obligations under the Notes and this Indenture except for those surviving obligations specified above.
In connection with a discharge, in the event the Company becomes insolvent within the applicable preference period after the date of deposit, monies held for the payment of the Notes may be part of the bankruptcy estate of the Company, disbursement of such monies may be subject to the automatic stay of the Bankruptcy Code and monies disbursed to Holders may be subject to disgorgement in favor of the Company’s estate.
ARTICLE IX
AMENDMENT, SUPPLEMENT AND WAIVER
SECTION 9.1 Without Consent of Holders of the Notes .
Notwithstanding Section 9.2 , without the consent of any Holders, the Company, the Guarantors, if any, and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental to this Indenture for any of the following purposes:
(1) to cure any ambiguity, mistake, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in place of certificated Notes;
(3) to provide for the assumption by a Successor Company or a successor company of a Guarantor, as applicable, of the Company’s or such Guarantor’s obligations under this Indenture, the Notes or any Guarantee;
(4) to make any change that would provide any additional rights or benefits to the holders of Notes or that does not adversely affect the legal rights under this Indenture of any such holder;
(5) to secure the Notes;
(6) to comply with requirements of the Commission in order to effect or maintain the qualification of this Indenture under the Trust Indenture Act of 1939, as amended;
(7) to add a Guarantee of the Notes;
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(8) to release a Guarantor upon its sale or designation as an Unrestricted Subsidiary or other permitted release from its Guarantee; provided that such sale, designation or release is in accordance with the applicable provisions of this Indenture;
(9) to conform the text of this Indenture, Notes or Guarantees to any provision of the “Description of Notes” in the Offering Circular.
SECTION 9.2 With Consent of Holders of Notes .
With the consent of the Holders of not less than a majority in aggregate principal amount of the outstanding Notes, the Company, the Guarantors, if any, and the Trustee may enter into an indenture or indentures supplemental to this Indenture for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders under this Indenture, including the definitions herein; provided , however , that no such supplemental indenture shall, without the consent of the Holder of each outstanding Note affected thereby:
(1) reduce the principal amount of Notes whose holders must consent to an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of any Note or alter the provisions with respect to the redemption of such Notes (other than provisions relating to Sections 3.9 , 4.10 and 4.14 except as set forth in clause (10) below);
(3) reduce the rate of or change the time for payment of interest on any Note;
(4) waive a Default or Event of Default in the payment of principal of, or interest or premium, or Additional Interest, if any, on the Notes (except a rescission of acceleration of the Notes by the holders of at least a majority in aggregate principal amount of the Notes with respect to a nonpayment default and a waiver of the payment default that resulted from such acceleration);
(5) make any Note payable in money other than that stated in such Notes;
(6) make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of holders of Notes to receive payments of principal of, or interest or premium or Additional Interest, if any, on the Notes or impair the right of any holder of Notes to institute suit for the enforcement of any payment on or with respect to such holder’s Notes;
(7) waive a redemption payment with respect to any Note (other than a payment required by Sections 3.9 , 4.10 and 4.14 except as set forth in clause (10) below);
(8) make any change in the ranking or priority of any Note that would adversely affect the holders of such Notes;
(9) modify the Guarantees in any manner adverse to the holders of the Notes;
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(10) amend, change or modify in any material respect the obligation of the Company to make and consummate a Change of Control Offer in respect of a Change of Control that has occurred or make and consummate an Asset Sale Offer in respect of an Asset Sale that has been consummated after a requirement to make an Asset Sale Offer has arisen; or
(11) make any change in the preceding amendment and waiver provisions.
The Holders of not less than a majority in aggregate principal amount of the outstanding Notes may on behalf of the Holders of all the Notes waive any past default under this Indenture and its consequences, except a default:
(1) in any payment in respect of the principal of (or premium, if any) or interest on any Notes (including any Note which is required to have been purchased pursuant to an Offer to Purchase which has been made by the Company), or
(2) in respect of a covenant or provision hereof which under this Indenture cannot be modified or amended without the consent of the Holder of each outstanding Note affected.
SECTION 9.3 Compliance with Trust Indenture Act .
Every amendment or supplement to this Indenture or the Notes shall be set forth in an amended or supplemental indenture that complies with the TIA as then in effect.
SECTION 9.4 Revocation and Effect of Consents .
Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a Note is a continuing consent by the Holder and every subsequent Holder of that Note or portion of the Note that evidences the same debt as the consenting Holder’s Note, even if notation of the consent is not made on the Note. However, any such Holder or subsequent Holder may revoke the consent as to its Note if the Trustee receives written notice of revocation before the date the waiver, supplement or amendment becomes effective. When an amendment, supplement or waiver becomes effective in accordance with its terms, it thereafter binds every Holder.
The Company may, but shall not be obligated to, fix a record date for determining which Holders consent to such amendment, supplement or waiver. If the Company fixes a record date, the record date shall be fixed at (i) the later of 30 days prior to the first solicitation of such consent or the date of the most recent list of Holders furnished for the Trustee prior to such solicitation pursuant to Section 2.5 hereof or (ii) such other date as the Company shall designate.
SECTION 9.5 Notation on or Exchange of Notes .
The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Company in exchange for all Notes may issue and the Trustee shall authenticate new Notes that reflect the amendment, supplement or waiver.
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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 9.6 Trustee to Sign Amendments, Etc .
The Trustee shall sign any amended or supplemental indenture authorized pursuant to this Article IX if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. The Company and the Guarantors may not sign an amendment or supplemental indenture until their respective Boards of Directors approve it. In signing or refusing to sign any amendment or supplemental indenture the Trustee shall be entitled to receive and (subject to Section 7.1 hereof) shall be fully protected in relying upon an Officers’ Certificate and an Opinion of Counsel stating that the execution of such amendment or supplemental indenture is authorized or permitted by this Indenture, that all conditions precedent thereto have been met or waived, that such amendment or supplemental indenture is not inconsistent herewith, and that it will be valid and binding upon the Company in accordance with its terms.
ARTICLE X
[RESERVED]
ARTICLE XI
NOTE GUARANTEES
SECTION 11.1 Guarantees .
(a) Each Guarantor hereby jointly and severally, fully, unconditionally and irrevocably guarantees the Notes and obligations of the Company hereunder and thereunder, and guarantees to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee on behalf of such Holder, that: (i) the principal of and premium, if any, and interest and Additional Interest, if any, on the Notes shall be paid in full when due, whether at Stated Maturity, by acceleration, call for redemption or otherwise (including, without limitation, the amount that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code), together with interest on the overdue principal, if any, and interest on any overdue interest and Additional Interest, if any, to the extent lawful, and all other obligations of the Company to the Holders or the Trustee hereunder or thereunder shall be paid in full or performed, all in accordance with the terms hereof and thereof; and (ii) in case of any extension of time of payment or renewal of any Notes or of any such other obligations, the same shall be paid in full when due or performed in accordance with the terms of the extension or renewal, whether at Stated Maturity, by acceleration or otherwise. Each of the Guarantees shall be a guarantee of payment and not of collection.
(b) Each Guarantor hereby agrees that its obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or this Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder with respect to any provisions hereof or thereof, the recovery of any judgment against the
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Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a Guarantor.
(c) Each Guarantor hereby waives the benefits of diligence, presentment, demand for payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company or any other Person, protest, notice and all demands whatsoever and covenants that the Guarantee of such Guarantor shall not be discharged as to any Note except by complete performance of the obligations contained in such Note and such Guarantee or as provided for in this Indenture. Each of the Guarantors hereby agrees that, in the event of a default in payment of principal or premium, if any or interest on such Note, whether at its Stated Maturity, by acceleration, call for redemption, purchase or otherwise, legal proceedings may be instituted by the Trustee on behalf of, or by, the Holder of such Note, subject to the terms and conditions set forth in this Indenture, directly against each of the Guarantors to enforce such Guarantor’s Guarantee without first proceeding against the Company or any other Guarantor. Each Guarantor agrees that if, after the occurrence and during the continuance of an Event of Default, the Trustee or any of the Holders are prevented by applicable law from exercising their respective rights to accelerate the maturity of the Notes, to collect interest on the Notes, or to enforce or exercise any other right or remedy with respect to the Notes, such Guarantor shall pay to the Trustee for the account of the Holders, upon demand therefor, the amount that would otherwise have been due and payable had such rights and remedies been permitted to be exercised by the Trustee or any of the Holders.
(d) If any Holder or the Trustee is required by any court or otherwise to return to the Company or any Guarantor, or any custodian, trustee, liquidator or other similar official acting in relation to the Company or any Guarantor, any amount paid by any of them to the Trustee or such Holder, the Guarantee of each of the Guarantors, to the extent theretofore discharged, shall be reinstated in full force and effect. This paragraph (d) shall remain effective notwithstanding any contrary action which may be taken by the Trustee or any Holder in reliance upon such amount required to be returned. This paragraph (d) shall survive the termination of this Indenture.
(e) Each Guarantor further agrees that, as between each Guarantor, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article VI hereof for the purposes of the Guarantee of such Guarantor, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any acceleration of such obligations as provided in Article VI hereof, such obligations (whether or not due and payable) shall forthwith become due and payable by each Guarantor for the purpose of the Guarantee of such Guarantor.
SECTION 11.2 Execution and Delivery of Guarantee .
To evidence its Guarantee set forth in Section 11.1 , each Guarantor agrees that a notation of such Guarantee substantially in the form attached hereto as Exhibit B shall be endorsed on each Note authenticated and delivered by the Trustee. Such notation of Guarantee shall be signed on behalf of such Guarantor by an officer of such Guarantor (or, if an officer is not available, by a board member or director) on behalf of such Guarantor by manual or facsimile
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signature. In case the officer, board member or director of such Guarantor who shall have signed such notation of Guarantee shall cease to be such officer, board member or director before the Note on which such Guarantee is endorsed shall have been authenticated and delivered by the Trustee, such Note nevertheless may be authenticated and delivered as though the Person who signed such notation of Guarantee had not ceased to be such officer, board member or director.
Each Guarantor agrees that its Guarantee set forth in Section 11.1 shall remain in full force and effect and apply to all the Notes notwithstanding any failure to endorse on each Note a notation of such Guarantee. The delivery of any Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of any Guarantee set forth in this Indenture on behalf of the Guarantors.
SECTION 11.3 Severability .
In case any provision of any Guarantee 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 11.4 Limitation of Guarantors’ Liability .
Each Guarantor and by its acceptance hereof each Holder confirms that it is the intention of all such parties that the Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance for purposes of the Federal Bankruptcy Code, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law or the provisions of its local law relating to fraudulent transfer or conveyance. To effectuate the foregoing intention, the Trustee, the Holders and Guarantors hereby irrevocably agree that the obligations of such Guarantor under its Guarantee shall be limited to the maximum amount that will not, after giving effect to all other contingent and fixed liabilities of such Guarantor and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under its Guarantee, result in the obligations of such Guarantor under its Guarantee constituting a fraudulent transfer or conveyance.
SECTION 11.5 Guarantors May Consolidate, Etc., on Certain Terms .
Except as otherwise provided in this Section 11.5 , a Guarantor may not sell or otherwise dispose of all or substantially all of its assets, or consolidate with or merge with or into (whether or not such Guarantor is the surviving Person) another Person unless:
(1) immediately after giving effect to such transactions, no Default or Event of Default exists; and
(2) the Net Proceeds of any such sale or other disposition of a Guarantor are applied in accordance with the provisions of Section 4.10 hereof.
In case of any such consolidation, merger, sale or conveyance and upon the assumption by the successor Person, by supplemental indenture, executed and delivered to the Trustee and
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satisfactory in form to the Trustee, of the Guarantee and the due and punctual performance of all of the covenants and conditions of this Indenture and the Registration Rights Agreement to be performed by the Guarantor, such successor Person shall succeed to and be substituted for the Guarantor with the same effect as if it had been named herein as a Guarantor. All the Guarantees so issued shall in all respects have the same legal rank and benefit under this Indenture as the Guarantees theretofore and thereafter issued in accordance with the terms of this Indenture as though all such Guarantees had been issued at the date of the execution hereof.
Except as set forth in Articles IV and V hereof, and notwithstanding clauses (1) and (2) above, nothing contained in this Indenture or in any of the Notes shall prevent any consolidation or merger of a Guarantor with or into the Company or another Guarantor, or shall prevent any sale or conveyance of the property of a Guarantor as an entirety or substantially as an entirety to the Company or another Guarantor.
SECTION 11.6 Releases Following Sale of Assets .
Any Guarantor shall be released and relieved of any obligations under this Guarantee, in the event that:
(a) the sale, disposition or other transfer (including through merger or consolidation) of all of the Capital Stock (or any sale, disposition or other transfer of Capital Stock following which the applicable Guarantor is no longer a Restricted Subsidiary), or all or substantially all the assets of the applicable Guarantor if such sale, disposition or other transfer is made in compliance with the provisions of this Indenture;
(b) the Company designates any Restricted Subsidiary that is a Guarantor as an Unrestricted Subsidiary in accordance with the provisions of this Indenture;
(c) in the case of any Restricted Subsidiary which after the Issue Date is required to guarantee the Notes pursuant to Section 4.17 the release or discharge of the guarantee by such Restricted Subsidiary of Indebtedness of the Company or any Restricted Subsidiary or the repayment of the Indebtedness or Disqualified Stock, in each case, which resulted in the obligation to guarantee the Notes;
(d) if the Company exercises its legal defeasance option or its covenant defeasance option pursuant to Sections 8.2 or 8.3 or if its obligations under this Indenture are discharged in accordance with the terms of this Indenture; or
(e) such Guarantor is also a guarantor or borrower under the Credit Facilities as in effect on the Issue Date and, at the time of release of its Guarantee, (x) has been released from its guarantee of, and all pledges and security, if any, granted in connection with the Credit Facilities, (y) is not an obligor under any Indebtedness (other than Indebtedness permitted to be incurred pursuant to Section 4.9(b)(7) , (9) , (10) or (15) and (z) does not guarantee any Indebtedness of the Company or any of the other Guarantors.
Upon delivery to the Trustee of an Officers’ Certificate and an Opinion of Counsel to the effect that such sale or other disposition was made by the Company in accordance with the
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provisions of this Indenture, including without limitation Section 4.10 , the Trustee shall execute any documents reasonably required in order to evidence the release of any Guarantor from its obligations under its Guarantee.
Any Guarantor not released from its obligations under this Guarantee shall remain liable for the full amount of principal of and interest on the Notes and for the other obligations of any Guarantor under this Indenture as provided in this Article XI.
SECTION 11.7 Release of a Guarantor .
Any Guarantor that is designated by the Board of Directors of the Company as an Unrestricted Subsidiary in accordance with the terms of this Indenture shall, at such time, be deemed automatically and unconditionally released and discharged of its obligations under its Guarantee without any further action on the part of the Trustee or any Holder. The Trustee shall deliver an appropriate instrument evidencing such release upon receipt of the Company’s request for such release accompanied by an Officers’ Certificate certifying as to the compliance with this Section 11.7 . Any Guarantor not so released shall remain liable for the full amount of principal of and interest on the Notes as provided in its Guarantee.
SECTION 11.8 Benefits Acknowledged .
Each Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this Indenture and that its guarantee and waivers pursuant to its Guarantee are knowingly made in contemplation of such benefits.
SECTION 11.9 Future Guarantors .
Each future Restricted Subsidiary shall become a Guarantor. Within ten (10) days of becoming a Restricted Subsidiary, such Subsidiary shall execute and deliver to the Trustee a supplemental indenture making such Subsidiary a party to this Indenture.
ARTICLE XII
MISCELLANEOUS
SECTION 12.1 Trust Indenture Act Controls .
If any provision of this Indenture limits, qualifies or conflicts with the duties imposed by TIA § 318(c), the imposed duties shall control.
SECTION 12.2 Notices .
Any notice or communication by the Company, any Guarantor or the Trustee to the others is duly given if in writing and delivered in Person or mailed by first class mail (registered or certified, return receipt requested), telecopier or overnight air courier guaranteeing next day delivery, to the others address:
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If to the Company:
Burlington Coat Factory Warehouse Corporation
1830 Route 130
Burlington, New Jersey 08016
Facsimile: (609) 239-9675
Attention: Paul Tang
With a copy to:
Kirkland & Ellis LLP
Citigroup Center
601 Lexington Avenue
New York, NY 10022
Facsimile: 212-446-6460
Attention: Joshua N. Korff
If to the Trustee:
Wilmington Trust FSB
Corporate Capital Markets
50 South Sixth Street, Suite 1290
Minneapolis, MN 55402
Fax: (612) 217-5651
Attention: Burlington Coat Administrator
The Company or the Trustee, by notice to the other, may designate additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) 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 acknowledged, if telecopied; and the next Business Day after timely delivery to the courier, if sent by overnight air courier promising next Business Day delivery.
Any notice or communication to a Holder shall be mailed by first class mail or by overnight air courier promising next Business Day delivery to its address shown on the register kept by the Registrar. Any notice or communication shall also be so mailed to any Person described in TIA § 313(c), to the extent required by the TIA. 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 is mailed in the manner provided above within the time prescribed, it is duly given, whether or not the addressee receives it, except in the case of notices or communications given to the Trustee, which shall be effective only upon actual receipt.
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If the Company mails a notice or communication to Holders, it shall mail a copy to the Trustee and each Agent at the same time.
SECTION 12.3 No Personal Liability of Directors, Officers, Employees and Stockholders .
No director, officer, employee, incorporator or stockholder of the Company, any of its Subsidiaries or any of its direct or indirect parent corporations, as such, will have any liability for any obligations of the Company or any Guarantor under the Notes, this Indenture, the Guarantees, or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each holder of Notes by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. The waiver may not be effective to waive liabilities under the federal securities laws, and it is the view of the Commission that such waiver is against public policy.
SECTION 12.4 Certificate and Opinion as to Conditions Precedent .
Upon any request or application by the Company to the Trustee to take any action under this Indenture (other than the initial issuance of the Notes), the Company shall furnish to the Trustee upon request:
(a) an Officers’ Certificate (which shall include the statements set forth in Section 12.5 hereof) stating that, in the opinion of the signers, all conditions precedent and covenants, if any, provided for in this Indenture relating to the proposed action have been satisfied; and
(b) an Opinion of Counsel (which shall include the statements set forth in Section 12.5 hereof) stating that, in the opinion of such counsel, all such conditions precedent and covenants have been satisfied.
SECTION 12.5 Statements Required in Certificate or Opinion .
Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture (other than a certificate provided pursuant to TIA § 314(a)(4)) shall comply with the provisions of TIA § 314(e) and shall include:
(a) a statement that the Person making such certificate or opinion has read such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been satisfied; and
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(d) a statement as to whether or not, in the opinion of such Person, such condition or covenant has been satisfied.
SECTION 12.6 Rules by Trustee and Agents .
The Trustee may make reasonable rules for action by or at a meeting of Holders. The Registrar or Paying Agent may make reasonable rules and set reasonable requirements for its functions.
SECTION 12.7 [Reserved].
SECTION 12.8 Governing Law .
THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE, THE NOTES AND THE NOTE GUARANTEES. The parties to this Indenture each hereby irrevocably submits to the non-exclusive jurisdiction of any New York State or federal court sitting in the Borough of Manhattan in The City of New York in any action or proceeding arising out of or relating to the Notes, the Guarantees or this Indenture, and all such parties hereby irrevocably agree that all claims in respect of such action or proceeding may be heard and determined in such New York State or federal court and hereby irrevocably waive, to the fullest extent that they may legally do so, the defense of an inconvenient forum to the maintenance of such action or proceeding. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES, THE NOTE GUARANTEES OR THE TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 12.9 No Adverse Interpretation of Other Agreements .
This Indenture may not be used to interpret any other indenture, loan or debt agreement of the Company or its Subsidiaries or of any other Person. Any such indenture, loan or debt agreement may not be used to interpret this Indenture.
SECTION 12.10 Successors .
All agreements of the Company and the Guarantors in this Indenture and the Notes and the Guarantees, as applicable, shall bind their respective successors and assigns. All agreements of the Trustee in this Indenture shall bind its successors and assigns.
SECTION 12.11 Severability .
In case any provision in this Indenture or in 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.
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SECTION 12.12 Counterpart Originals .
The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement.
SECTION 12.13 Table of Contents, Headings, Etc .
The Table of Contents, Cross-Reference Table 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 of this Indenture and shall in no way modify or restrict any of the terms or provisions hereof.
SECTION 12.14 Acts of Holders .
(a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “ Act ” of Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section 12.14 .
(b) The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to such officer the execution thereof. Where such execution is by a signer acting in a capacity other than such signer’s individual capacity, such certificate or affidavit shall also constitute sufficient proof of such signer’s authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Holder list maintained under Section 2.5 hereunder.
(d) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Note shall bind every future Holder of the same Note and the holder of every Note issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee or the Company in reliance thereon, whether or not notation of such action is made upon such Note.
(e) If the Company shall solicit from the Holders any request, demand, authorization, direction, notice, consent, waiver or other Act, the Company may, at its option, by or pursuant to a Board Resolution, fix in advance a record date for the determination of Holders entitled to give
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such request, demand, authorization, direction, notice, consent, waiver or other Act, but the Company shall have no obligation to do so. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other Act may be given before or after such record date, but only the Holders of record at the close of business on such record date shall be deemed to be Holders for the purposes of determining whether Holders of the requisite proportion of outstanding Notes have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other Act, and for that purpose the outstanding Notes shall be computed as of such record date; provided that no such authorization, agreement or consent by the Holders on such record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than six months after the record date.
[Signatures on following page]
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SIGNATURES
| Dated as of February 24, 2011 | BURLINGTON COAT FACTORY WAREHOUSE CORPORATION | |||||
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By: |
/s/ Robert LaPenta, Jr. |
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Name: |
Robert LaPenta, Jr. | |||||
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Title: |
Vice President and Treasurer | |||||
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EACH OF THE GUARANTORS LISTED ON ANNEX A HERETO, as Guarantors |
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By: |
/s/ Robert LaPenta, Jr. |
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Name: |
Robert LaPenta, Jr. | |||||
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Title: |
Vice President and Treasurer | |||||
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WILMINGTON TRUST FSB, as Trustee |
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By: |
/s/ Jane Schweiger | |||
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Name: |
Jane Schweiger | |||
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Title: |
Vice President | |||
ANNEX A
|
Guarantors |
Jurisdiction of Organization | |
|
Burlington Coat Factory of Alabama, LLC |
Alabama | |
|
Burlington Coat Factory Realty of Huntsville, LLC |
Alabama | |
|
Burlington Coat Factory Warehouse of Anchorage, Inc. |
Alaska | |
|
Burlington Coat Factory Realty of Mesa, Inc. |
Arizona | |
|
Burlington Coat Factory Realty of Desert Sky, Inc. |
Arizona | |
|
Burlington Coat Factory of Arizona, LLC |
Arizona | |
|
Burlington Coat Factory of Arkansas, LLC |
Arkansas | |
|
Burlington Coat Factory Realty of Dublin, Inc. |
California | |
|
Burlington Coat Factory Realty of Florin, Inc. |
California | |
|
Burlington Coat Factory Realty of Ventura, Inc. |
California | |
|
Baby Depot of California, LLC |
California | |
|
Burlington Coat Factory of California, LLC |
California | |
|
Burlington Coat Factory of San Bernardino, LLC |
California | |
|
MJM Designer Shoes of California, LLC |
California | |
|
Burlington Coat Factory of Colorado, LLC |
Colorado | |
|
Burlington Coat Realty of East Windsor, Inc. |
Connecticut | |
|
Burlington Coat Factory of Connecticut, LLC |
Connecticut | |
|
Cohoes Fashions of Connecticut, LLC |
Connecticut | |
|
Burlington Coat Factory of Texas, Inc. |
Delaware | |
|
C.F.I.C. Corporation |
Delaware | |
|
Burlington Coat Factory Realty Corp. |
Delaware | |
|
Burlington Coat Factory of Delaware, LLC |
Delaware | |
|
MJM Designer Shoes of Delaware, LLC |
Delaware | |
|
Burlington Coat Factory Investments Holdings, Inc. |
Delaware | |
|
Burlington Coat Factory of Texas, L.P. |
Delaware | |
|
Guarantors |
Jurisdiction of Organization | |
|
Burlington Coat Factory Realty of University Square, Inc. |
Florida | |
|
Burlington Coat Factory Realty of Coral Springs, Inc. |
Florida | |
|
Burlington Coat Factory Realty of West Colonial, Inc. |
Florida | |
|
Burlington Coat Factory Realty of Orlando, Inc. |
Florida | |
|
Burlington Coat Factory Realty of Sarasota, Inc. |
Florida | |
|
K&T Acquisition Corp. |
Florida | |
|
Burlington Coat Factory of Florida, LLC |
Florida | |
|
MJM Designer Shoes of Florida, LLC |
Florida | |
|
Bee Ridge Plaza, LLC |
Florida | |
|
Burlington Coat Factory Warehouse of Atlanta, Inc. |
Georgia | |
|
Burlington Coat Factory Realty of Morrow, Inc. |
Georgia | |
|
Burlington Coat Factory of Georgia, LLC |
Georgia | |
|
Burlington Coat Factory of Hawaii, LLC |
Hawaii | |
|
Burlington Coat Factory of Idaho, LLC |
Idaho | |
|
Burlington Coat Factory Warehouse of East St. Louis, Inc. |
Illinois | |
|
Burlington Coat Realty of Gurnee, Inc. |
Illinois | |
|
Burlington Coat Factory Realty of Bloomingdale, Inc. |
Illinois | |
|
Burlington Coat Factory Realty of River Oaks, Inc. |
Illinois | |
|
Burlington Coat Factory of Illinois, LLC |
Illinois | |
|
Burlington Coat Factory Realty of Greenwood, Inc. |
Indiana | |
|
Burlington Coat Factory of Indiana, LLC |
Indiana | |
|
Burlington Coat Factory of Iowa, LLC |
Iowa | |
|
Burlington Coat Factory of Kansas, LLC |
Kansas | |
|
Burlington Coat Factory of Kentucky, Inc. |
Kentucky | |
|
Burlington Coat Factory of Louisiana, LLC |
Louisiana | |
|
Burlington Coat Factory of Maine, LLC |
Maine | |
|
Guarantors |
Jurisdiction of Organization | |
|
Burlington Coat Factory of Maryland, LLC |
Maryland | |
|
Burlington Coat Factory Realty of North Attleboro, Inc. |
Massachusetts | |
|
Burlington Coat Factory of Massachusetts, LLC |
Massachusetts | |
|
Cohoes Fashions of Massachusetts, LLC |
Massachusetts | |
|
Burlington Coat Factory Warehouse of Detroit, Inc. |
Michigan | |
|
Burlington Coat Factory Warehouse of Grand Rapids, Inc. |
Michigan | |
|
Burlington Coat Factory Warehouse of Redford, Inc. |
Michigan | |
|
Burlington Coat Factory of Michigan, LLC |
Michigan | |
|
Burlington Coat Factory of Minnesota, LLC |
Minnesota | |
|
Burlington Coat Factory of Mississippi, LLC |
Mississippi | |
|
Burlington Coat Factory Realty of Des Peres, Inc. |
Missouri | |
|
Burlington Coat Factory of Missouri, LLC |
Missouri | |
|
Burlington Coat Factory of Montana, LLC |
Montana | |
|
Burlington Coat Factory of Nebraska, LLC |
Nebraska | |
|
Burlington Coat Realty of Las Vegas, Inc. |
Nevada | |
|
Burlington Coat Factory of Nevada, LLC |
Nevada | |
|
Burlington Coat Factory of New Hampshire, LLC |
New
Hampshire |
|
|
Burlington Coat Factory Direct Corporation |
New Jersey | |
|
Burlington Coat Factory Warehouse of Edgewater Park, Inc. |
New Jersey | |
|
Burlington Coat Factory Warehouse of New Jersey, Inc. |
New Jersey | |
|
MJM Designer Shoes of Moorestown, Inc. |
New Jersey | |
|
Super Baby Depot of Moorestown, Inc. |
New Jersey | |
|
Burlington Coat Factory Realty of Edgewater Park, Inc. |
New Jersey | |
|
Burlington Coat Factory Realty of Paramus, Inc. |
New Jersey | |
|
Burlington Coat Factory Realty of Pinebrook, Inc. |
New Jersey | |
|
Burlington Coat Factory Warehouse of Edgewater Park Urban Renewal Corp. |
New Jersey | |
|
Guarantors |
Jurisdiction of Organization | |
|
Burlington Coat Factory of New Jersey, LLC |
New Jersey | |
|
Cohoes Fashions of New Jersey, LLC |
New Jersey | |
|
MJM Designer Shoes of New Jersey, LLC |
New Jersey | |
|
Burlington Coat Factory of New Mexico, LLC |
New Mexico | |
|
LC Acquisition Corp. |
New York | |
|
Georgetown Fashions Inc. |
New York | |
|
Monroe G. Milstein, Inc. |
New York | |
|
Burlington Coat Factory Realty of Yonkers, Inc. |
New York | |
|
Burlington Coat Factory of New York, LLC |
New York | |
|
Cohoes Fashions of New York, LLC |
New York | |
|
MJM Designer Shoes of New York, LLC |
New York | |
|
Burlington Coat Factory of North Carolina, LLC |
North Carolina | |
|
Burlington Coat Factory of North Dakota, LLC |
North Dakota | |
|
Burlington Coat Factory Warehouse of Cleveland, Inc. |
Ohio | |
|
Burlington Coat Factory of Ohio, LLC |
Ohio | |
|
Burlington Coat Factory Realty of Tulsa, Inc. |
Oklahoma | |
|
Burlington Coat Factory of Oklahoma, LLC |
Oklahoma | |
|
Burlington Coat Factory of Oregon, LLC |
Oregon | |
|
Burlington Coat Factory Warehouse Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Cheltenham, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Langhorne, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Montgomeryville, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Realty of West Mifflin, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Realty of Langhorne, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Realty of Whitehall, Inc. |
Pennsylvania | |
|
Burlington Factory Warehouse of Reading, Inc. |
Pennsylvania | |
|
Guarantors |
Jurisdiction of Organization | |
|
Burlington Coat Factory Warehouse of Bristol, LLC |
Pennsylvania | |
|
Burlington Coat Factory of Pennsylvania, LLC |
Pennsylvania | |
|
MJM Designer Shoes of Pennsylvania, LLC |
Pennsylvania | |
|
Burlington Coat Factory of Puerto Rico, LLC |
Puerto Rico | |
|
Cohoes Fashions of Cranston, Inc. |
Rhode Island | |
|
Burlington Coat Factory of Rhode Island, LLC |
Rhode Island | |
|
Burlington Coat Factory Warehouse of Charleston, Inc. |
South Carolina | |
|
Burlington Coat Factory of South Carolina, LLC |
South Carolina | |
|
Burlington Coat Factory of South Dakota, LLC |
South Dakota | |
|
Burlington Coat Factory Warehouse of Hickory Commons, Inc. |
Tennessee | |
|
Burlington Coat Factory Warehouse of Memphis, Inc. |
Tennessee | |
|
Burlington Coat Factory Warehouse of Shelby, Inc. |
Tennessee | |
|
Burlington Coat Factory Realty of Memphis, Inc. |
Tennessee | |
|
Burlington Coat Realty of Plano, Inc. |
Texas | |
|
Burlington Coat Factory Warehouse of Baytown, Inc. |
Texas | |
|
M J M Designer Shoes of Texas, Inc. |
Texas | |
|
Burlington Coat Realty of Houston, Inc. |
Texas | |
|
Burlington Coat Factory Realty of Westmoreland, Inc. |
Texas | |
|
Burlington Coat Factory Realty of Bellaire, Inc. |
Texas | |
|
Burlington Coat Factory Realty of El Paso, Inc. |
Texas | |
|
Burlington Coat Factory of Utah, LLC |
Utah | |
|
Burlington Coat Factory of Vermont, LLC |
Vermont | |
|
BCF Cards, Inc. |
Virginia | |
|
Burlington Coat Factory Warehouse of Coliseum, Inc. |
Virginia | |
|
Burlington Coat Realty of Potomac, Inc. |
Virginia | |
|
Burlington Coat Factory Realty of Fairfax, Inc. |
Virginia | |
|
Guarantors |
Jurisdiction of Organization | |
|
Burlington Coat Factory Realty of Coliseum, Inc. |
Virginia | |
|
Burlington Coat Factory of Virginia, LLC |
Virginia | |
|
Burlington Coat Factory of Pocono Crossing, LLC |
Virginia | |
|
Burlington Coat Factory Realty of Franklin, Inc. |
Washington | |
|
Burlington Coat Factory of Washington, LLC |
Washington | |
|
Burlington Coat Factory of West Virginia, LLC |
West Virginia | |
|
Burlington Coat Factory of Wisconsin, LLC |
Wisconsin | |
EXHIBIT A
FORM OF NOTE
(Face of 10.000% Senior Note)
10.000% Senior Notes due 2019
[Global Note Legend]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OR TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUIRED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY) ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE.
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[Restricted Notes Legend]
THE NOTES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933 (THE “SECURITIES ACT”) AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (A) (1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (2) IN AN OFFSHORE TRANSACTION COMPLYING WITH RULE 903 OR RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE), (4) TO AN INSTITUTIONAL INVESTOR THAT IS AN ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501 OF REGULATION D UNDER THE SECURITIES ACT IN A TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR (5) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND (B) IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE STATES OF THE UNITED STATES AND OTHER JURISDICTIONS.
[Regulation S Temporary Global Note legend]
THIS GLOBAL NOTE IS A TEMPORARY GLOBAL NOTE FOR PURPOSES OF REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”). NEITHER THIS TEMPORARY GLOBAL NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD OR DELIVERED, EXCEPT AS PERMITTED UNDER THE INDENTURE REFERRED TO BELOW.
NO BENEFICIAL OWNERS OF THIS TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED CERTIFICATIONS HAVE BEEN DELIVERED PURSUANT TO THE TERMS OF THE INDENTURE.
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|
No. |
CUSIP NO. |
Burlington Coat Factory Warehouse Corporation
promises to pay to Cede & Co. or registered assigns, the principal sum of ($) on February 15, 2019.
Interest Payment Dates: February 15 and August 15, beginning August 15, 2011
Record Dates: February 1 and August 1
Reference is made to further provisions of this Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as set forth at this place.
Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Note shall not be entitled to any benefits under the Indenture referred to on the reverse hereof or be valid or obligatory for any purpose.
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| BURLINGTON COAT FACTORY WAREHOUSE CORPORATION | ||
| By: |
|
|
| Name: | ||
| Title: | ||
This is one of the Senior Notes referred
to in the within-mentioned Indenture:
Dated:
| WILMINGTON TRUST FSB, as Trustee | ||
| By: |
|
|
| Name: | ||
| Title: | ||
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(Back of 10.000% Senior Note)
10.000% Senior Notes due 2019
Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.
(1) Interest . Burlington Coat Factory Warehouse Corporation, a Delaware corporation (“Burlington” or the “Company”) promises to pay interest on the principal amount of this 10.000% Senior Note due 2019 (a “10.000% Senior Note”) at a fixed rate. Burlington will pay interest in United States dollars (except as otherwise provided herein) semiannually in arrears on February 15 and August 15, commencing on August 15, 2011 or if any such day is not a Business Day, on the next succeeding Business Day (each an “Interest Payment Date”). Interest on the 10.000% Senior Notes shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from February 24, 2011; provided that if there is no existing Default or Event of Default in the payment of interest, and if this 10.000% Senior Note is authenticated between a record date referred to on the face hereof and the next succeeding Interest Payment Date (but after February 24, 2011), interest shall accrue from such next succeeding Interest Payment Date, except in the case of the original issuance of 10.000% Senior Notes, in which case interest shall accrue from the date of authentication. Burlington shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal at the rate equal to 1% per annum in excess of the then applicable interest rate on the 10.000% Senior Notes to the extent lawful; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace period) at the same rate to the extent lawful. Interest shall be computed on the basis of a 360-day year comprised of twelve 30-day months. The interest rate on the Notes will in no event be higher than the maximum rate permitted by New York law as the same may be modified by United States law of general application.
(2) Method of Payment . Burlington will pay interest on the 10.000% Senior Notes (except defaulted interest) on the applicable Interest Payment Date to the Persons who are registered Holders of 10.000% Senior Notes at the close of business on the February 1 and August 1 preceding the Interest Payment Date, even if such 10.000% Senior Notes are cancelled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest. The 10.000% Senior Notes shall be payable as to principal, premium and interest at the office or agency of Burlington maintained for such purpose within or without the City and State of New York, or, at the option of Burlington, payment of interest may be made by check mailed to the Holders at their addresses set forth in the register of Holders; provided that payment by wire transfer of immediately available funds shall be required with respect to principal of, premium, if any, and interest on, all Global Notes and all other 10.000% Senior Notes the Holders of which shall have provided written wire transfer instructions to Burlington and the Paying Agent. Such payment shall be in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.
Any payments of principal of this 10.000% Senior Note prior to Stated Maturity shall be binding upon all future Holders of this Note and of any Note issued upon the registration of
A-5
transfer hereof or in exchange hereof or in lieu hereof, whether or not noted hereon. The amount due and payable at the maturity of this Note shall be payable only upon presentation and surrender of this Note at an office of the Trustee or the Trustee’s agent appointed for such purposes.
(3) Paying Agent and Registrar . Initially, Wilmington Trust FSB, the Trustee under the Indenture, shall act as Paying Agent and Registrar. Burlington may change any Paying Agent or Registrar without notice to any Holder. Burlington or any of its Subsidiaries may act in any such capacity.
(4) Indenture . Burlington issued the 10.000% Senior Notes under an Indenture, dated as of February 24, 2011 (the “Indenture”), among Burlington Coat Factory Warehouse Corporation and the Trustee. The terms of the 10.000% Senior Notes include those stated in the Indenture and those made a part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb) (the “TIA”). To the extent the provisions of this 10.000% Senior Note are inconsistent with the provisions of the Indenture, the Indenture shall govern. The 10.000% Senior Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms. The 10.000% Senior Notes issued on the Issue Date are senior obligations of Burlington limited to $450,000,000 in aggregate principal amount, plus amounts, if any, sufficient to pay premium and interest on outstanding 10.000% Senior Notes as set forth in Paragraph 2 hereof. The Indenture permits the issuance of Additional Notes subject to compliance with certain conditions.
The payment of principal and interest on the 10.000% Senior Notes is unconditionally guaranteed on a senior basis by the Guarantors.
(5) Optional Redemption .
(a) The Notes may be redeemed in whole or in part, at any time prior to February 15, 2015, at the option of the Company upon not less than 30 nor more than 60 days’ prior notice mailed by first-class mail to each Holder’s registered address, 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, the applicable redemption date (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date).
(b) The Notes are subject to redemption, at the option of the Company, in whole or in part, at any time on or after February 15, 2015, upon not less than 30 nor more than 60 days’ notice at the following Redemption Prices (expressed as a percentage of the principal amount to be redeemed) set forth below, plus accrued and unpaid interest and Additional Interest, if any, to, but not including, the redemption date (subject to the right of Holders of record on the relevant regular record date to receive interest due on an interest payment date that is on or prior to the redemption date), if redeemed during the 12-month period beginning February 15 of the years indicated:
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|
Year |
Redemption
Price |
|||
|
2015 |
105.000 | % | ||
|
2016 |
102.500 | % | ||
|
2017 and thereafter |
100.000 | % | ||
(c) In addition to the optional redemption of the Notes in accordance with the provisions of the preceding paragraph, prior to February 15, 2014, the Company may, with the net cash proceeds of one or more Equity Offerings, redeem up to 35% of the aggregate principal amount of the outstanding Notes at a Redemption Price of 110.000% of the principal amount thereof, plus accrued and unpaid interest and Additional Interest, thereon, if any, to the date of redemption (provided that if the Equity Offering is an offering by Holdings or any of its direct or indirect parent corporations, a portion of the net cash proceeds thereof equal to the amount required to redeem any such Notes is contributed to the equity capital of the Company); provided, however, that at least 65% of the principal amount of Notes originally issued under the Indenture must remain outstanding immediately after the occurrence of each such redemption (excluding in such calculation Notes held by Holdings and its Subsidiaries) and that any such redemption occurs within 90 days following the date of the closing of such Equity Offering.
(6) Mandatory Redemption . Burlington shall not be required to make mandatory redemption or sinking fund payments with respect to the 10.000% Senior Notes.
(7) Repurchase at Option of Holder .
(a) Upon the occurrence of a Change of Control, each Holder will have the right to require Burlington to repurchase all or any part (equal to $2,000 or integral multiples of $1,000 in excess thereof) of such Holder’s 10.000% Senior Notes pursuant to the offer described below (the “Change of Control Offer”) at an offer price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest thereon to the date of purchase. Within 30 days following any Change of Control, Burlington will mail a notice to each Holder describing the transaction or transactions that constitute the Change of Control setting forth the procedures governing the Change of Control Offer required by the Indenture.
(b) Upon the occurrence of certain Asset Sales, the Company may be required to offer to purchase Notes.
(c) Holders of the 10.000% Senior Notes that are the subject of an offer to purchase will receive notice of an Offer to Purchase pursuant to an Asset Sale or a Change of Control from Burlington prior to any related purchase date and may elect to have such 10.000% Senior Notes purchased by completing the form titled “Option of Holder to Elect Purchase” appearing below.
(8) Notice of Redemption . Notice of redemption shall be mailed at least 30 days but not more than 60 days before the redemption date to each Holder whose 10.000% Senior Notes are to be redeemed at its registered address. 10.000% Senior Notes in denominations larger than $2,000 may be redeemed in part but only in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof, unless all of the 10.000% Senior Notes held by a Holder
A-7
are to be redeemed. On and after the redemption date, interest ceases to accrue on the 10.000% Senior Notes or portions hereof called for redemption.
(9) [Reserved]
(10) Denominations, Transfer, Exchange . The 10.000% Senior Notes are in registered form without coupons in initial denominations of $2,000 and integral multiples of $1,000 in excess thereof. The transfer of the 10.000% Senior Notes may be registered and the 10.000% Senior Notes may be exchanged as provided in the Indenture. The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and Burlington may require a Holder to pay any taxes and fees required by law or permitted by the Indenture. Burlington need not exchange or register the transfer of any 10.000% Senior Note or portion of a 10.000% Senior Note selected for redemption, except for the unredeemed portion of any 10.000% Senior Note being redeemed in part. Also, it need not exchange or register the transfer of any 10.000% Senior Notes for a period of 15 days before a selection of 10.000% Senior Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date.
(11) Persons Deemed Owners . The registered holder of a 10.000% Senior Note may be treated as its owner for all purposes.
(12) Amendment, Supplement and Waiver . Subject to the following paragraphs, the Indenture and the 10.000% Senior Notes may be amended or supplemented with the consent of the Holders of at least a majority in aggregate principal amount of the then outstanding 10.000% Senior Notes, including, without limitation, consents obtained in connection with a purchase of or, tender offer or exchange offer for 10.000% Senior Notes, and any existing Default or Event of Default or compliance with any provision of the Indenture or the 10.000% Senior Notes may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding 10.000% Senior Notes, including consents obtained in connection with a tender offer or exchange offer for 10.000% Senior Notes.
Notwithstanding Section 9.2 of the Indenture, without the consent of any Holders, Burlington, the Guarantors, if any, and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental to the Indenture for any of the following purposes:
(1) to cure any ambiguity, mistake, defect or inconsistency;
(2) to provide for uncertificated Notes in addition to or in place of certificated Notes;
(3) to provide for the assumption by a Successor Company or a successor company of a Guarantor, as applicable, of the Company’s or such Guarantor’s obligations under this Indenture, the Notes or any Guarantee;
(4) to make any change that would provide any additional rights or benefits to the holders of Notes or that does not adversely affect the legal rights under this Indenture of any such holder;
A-8
(5) to secure the Notes;
(6) to comply with requirements of the Commission in order to effect or maintain the qualification of this Indenture under the Trust Indenture Act of 1939, as amended;
(7) to add a Guarantee of the Notes;
(8) to release a Guarantor upon its sale or designation as an Unrestricted Subsidiary or other permitted release from its Guarantee; provided that such sale, designation or release is in accordance with the applicable provisions of this Indenture;
(9) to conform the text of this Indenture, Notes or Guarantees to any provision of the “Description of Notes” in the Offering Circular.
With the consent of the Holders of not less than a majority in aggregate principal amount of the outstanding Notes, the Company, the Guarantors, if any, and the Trustee may enter into an indenture or indentures supplemental to this Indenture for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders under this Indenture, including the definitions herein; provided , however , that no such supplemental indenture shall, without the consent of the Holder of each outstanding Note affected thereby:
(1) reduce the principal amount of Notes whose holders must consent to an amendment, supplement or waiver;
(2) reduce the principal of or change the fixed maturity of any Note or alter the provisions with respect to the redemption of such Notes (other than provisions relating to Sections 3.9 , 4.10 and 4.14 except as set forth in clause (10) below);
(3) reduce the rate of or change the time for payment of interest on any Note;
(4) waive a Default or Event of Default in the payment of principal of, or interest or premium, or Additional Interest, if any, on the Notes (except a rescission of acceleration of such Notes by the holders of at least a majority in aggregate principal amount of such Notes with respect to a nonpayment default and a waiver of the payment default that resulted from such acceleration);
(5) make any Note payable in money other than that stated in such Notes;
(6) make any change in the provisions of this Indenture relating to waivers of past Defaults or the rights of holders of Notes to receive payments of principal of, or interest or premium or Additional Interest, if any, on the Notes or impair the right of any holder of Notes to institute suit for the enforcement of any payment on or with respect to such holder’s Notes;
A-9
(7) waive a redemption payment with respect to any Note (other than a payment required by Sections 3.9 , 4.10 and 4.14 except as set forth in clause (10) below);
(8) make any change in the ranking or priority of any Note that would adversely affect the holders of such Notes;
(9) modify the Guarantees in any manner adverse to the holders of the Notes;
(10) amend, change or modify in any material respect the obligation of the Company to make and consummate a Change of Control Offer in respect of a Change of Control that has occurred or make and consummate an Asset Sale Offer in respect of an Asset Sale that has been consummated after a requirement to make an Asset Sale Offer has arisen; or
(11) make any change in the preceding amendment and waiver provisions.
The Holders of not less than a majority in aggregate principal amount of the outstanding Notes may on behalf of the Holders of all the Notes waive any past default under this Indenture and its consequences, except a default:
(1) in any payment in respect of the principal of (or premium, if any) or interest on any Notes (including any Note which is required to have been purchased pursuant to an Offer to Purchase which has been made by the Company), or
(2) in respect of a covenant or provision hereof which under this Indenture cannot be modified or amended without the consent of the Holder of each outstanding Note affected.
(13) Defaults and Remedies . Events of Default include:
(1) the Company defaults in payment when due and payable, upon redemption, acceleration or otherwise, of principal of, or premium, if any, on the Notes;
(2) the Company defaults in the payment when due of interest or Additional Interest, if any, on or with respect to the Notes and such default continues for a period of 30 days;
(3) the Company defaults in the performance of, or breaches any covenant, warranty or other agreement contained in, this Indenture (other than a default in the performance or breach of a covenant, warranty or agreement which is specifically dealt with in clauses (1) or (2) above) and such default or breach continues for a period of 60 days after notice from the Trustee or the Holders of at least 25%in aggregate principal amount of the outstanding Notes;
(4) a default under any mortgage, indenture or instrument under which there is issued or by which there is secured or evidenced any Indebtedness for money borrowed by the Company or any Restricted Subsidiary or the payment of which is guaranteed by
A-10
the Company or any Restricted Subsidiary (other than Indebtedness owed to the Company or a Restricted Subsidiary), whether such Indebtedness or guarantee now exists or is created after the Issue Date, if (A) such default either (1) results from the failure to pay any such Indebtedness at its stated final maturity (after giving effect to any applicable grace periods) or (2) relates to an obligation other than the obligation to pay principal of any such Indebtedness at its stated final maturity and results in the holder or holders of such Indebtedness causing such Indebtedness to become due prior to its stated maturity and (B) the principal amount of such Indebtedness, together with the principal amount of any other such Indebtedness in default for failure to pay principal at stated final maturity (after giving effect to any applicable grace periods), or the maturity of which has been so accelerated, aggregate $50.0 million (or its foreign currency equivalent) or more at any one time outstanding;
(5) the failure by the Company or any Significant Subsidiary to pay final judgments aggregating in excess of $50.0 million (other than any judgments covered by indemnities or insurance policies issued by reputable and creditworthy companies), which final judgments remain unpaid, undischarged and unstayed for a period of more than 60 days after the applicable judgment becomes final;
(6) the Guarantee of a Significant Subsidiary that is a Guarantor or any group of Subsidiaries that are Guarantors and that, taken together as of the date of the most recent audited financial statements of the Company, would constitute a Significant Subsidiary ceases to be in full force and effect (except as contemplated by the terms hereof) or any Guarantor denies or disaffirms its obligations under this Indenture or any Guarantee(s), other than by reason of the release of the Guarantee(s) in accordance with the terms of this Indenture, and such Default continues for 30 days; and
(7)(i) the Company, any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken as a whole, would constitute a 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 property,
(d) makes a general assignment for the benefit of its creditors, or
(e) generally is not paying its debts as they become due;
A-11
(ii) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(a) is for relief against the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary, in an involuntary case;
(b) appoints a custodian of the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary or for all or substantially all of the property of the Company or any of its Restricted Subsidiaries; or
(c) orders the liquidation of the Company or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together, would constitute a Significant Subsidiary and the order or decree remains unstayed and in effect for 60 consecutive days.
If an Event of Default (other than an Event of Default specified in clause (7) above with respect to the Company) shall occur and be continuing, then and in every such case the Trustee or the Holders of at least 25% in aggregate principal amount of the outstanding Notes may declare the principal of the Notes and any accrued interest on the Notes to be due and payable by a notice in writing to the Company and the Trustee specifying the respective Event of Default and that it is an Acceleration Notice, and the same shall immediately become 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. 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, under certain circumstances, rescind and annul such acceleration if all Events of Default, other than the nonpayment of accelerated principal of or interest on such Notes, have been cured or waived as provided in the Indenture.
In the event of any Event of Default specified in clause (4) above, such Event of Default and all consequences thereof (excluding, however, any resulting payment default) will be annulled, waived and rescinded, automatically and without any action by the Trustee or the holders of the Notes, if within 30 days after such Event of Default arose the Company delivers an Officers’ Certificate to the Trustee stating that (x) the Indebtedness or guarantee that is the basis for such Event of Default has been discharged or (y) the holders thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving rise to such Event of Default or (z) the default that is the basis for such Event of Default has been cured, it being understood that in no event shall an acceleration of the principal amount of the Notes as described above be annulled, waived or rescinded upon the happening of any such events.
If an Event of Default specified in clause (7) above with respect to the Company occurs and is continuing, then all unpaid principal of, and premium, if any, and accrued and unpaid interest and Additional Interest, if any, on all of the outstanding Notes shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any holder of the Notes.
A-12
(14) Trustee Dealings with Burlington . The Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for Burlington, the Guarantors or their respective Affiliates, and may otherwise deal with Burlington, the Guarantors or their respective Affiliates, as if it were not the Trustee.
(15) No Recourse Against Others . No director, officer, employee, stockholder, general or limited partner or incorporator, past, present or future, of the Company or any of its Subsidiaries, as such or in such capacity, shall have any personal liability for any obligations of the Company under the Notes, any Guarantee or the Indenture by reason of his, her or its status as such director, officer, employee, stockholder, general or limited partner or incorporator.
(16) Authentication . This 10.000% Senior Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.
(17) Abbreviations . Customary abbreviations may be used in the name of a Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gifts to Minors Act).
(18) CUSIP Numbers . Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the 10.000% Senior Notes and the Trustee may use CUSIP numbers in notices of redemption as a convenience to the Holders. No representation is made as to the accuracy of such numbers either as printed on the 10.000% Senior Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.
Burlington shall furnish to any Holder upon written request and without charge a copy of the Indenture. Requests may be made to:
Burlington Coat Factory Warehouse Corporation
1830 Route 130
Burlington, New Jersey 08016
Facsimile: (609) 239-9675
Attention: Paul Tang
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ASSIGNMENT FORM
To assign this 10.000% Senior Note, fill in the form below: (I) or (we) assign and transfer this 10.000% Senior Note to
(Insert assignee’s soc. sec. or tax I.D. no.)
(Print or type assignee’s name, address and zip code)
and irrevocably appoint
to transfer this 10.000% Senior Note on the books of Burlington. The agent may substitute another to act for him.
Date:
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Your Signature: |
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| (Sign exactly as your name appears on the face of this 10.000% Senior Note) |
Signature guarantee:
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this 10.000% Senior Note purchased by Burlington pursuant to Section 4.10 or 4.14 of the Indenture, check the box below:
[ ] Section 4.10 [ ] Section 4.14
If you want to elect to have only part of the 10.000% Senior Note purchased by Burlington pursuant to Section 4.10 or Section 4.14 of the Indenture, state the amount you elect to have purchased: $
| Date: | Your Signature: |
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||||
| (Sign exactly as your name appears on the 10.000% Senior Note) |
Tax Identification No.:
Signature guarantee:
A-15
CERTIFICATE TO BE DELIVERED UPON
EXCHANGE OF TRANSFER RESTRICTED NOTES
Burlington Coat Factory Warehouse Corporation
1830 Route 130
Burlington, New Jersey 08016
Fax: (609) 239-9675
Attention: Paul Tang
Wilmington Trust FSB
50 South Sixth Street, Suite 1290
Minneapolis, MN 55402
Fax: (612) 217-5651
Attention: Jane Y. Schweiger
Re: CUSIP #
Reference is hereby made to that certain Indenture dated February 24, 2011 (the “ Indenture ”) among Burlington Coat Factory Warehouse Corporation and Wilmington Trust FSB, as trustee (the “ Trustee ”). Capitalized terms used but not defined herein shall have the meanings set forth in the Indenture.
This certificate relates to $ principal amount of Notes held in (check applicable space) book-entry or definitive form by the undersigned.
The undersigned (transferor) (check one box below):
| ¨ | hereby requests the Registrar to deliver in exchange for its beneficial interest in the Global Note held by the Depositary a Note or Notes in definitive, registered form of authorized denominations and an aggregate principal amount equal to its beneficial interest in such Global Note (or the portion thereof indicated above), in accordance with Section 2.6 of the Indenture; |
| ¨ | hereby requests the Trustee to exchange a Note or Notes to (transferee). |
In connection with any transfer of any of the Notes evidenced by this certificate occurring prior to the expiration of the periods referred to in Rule 144(k) under the Securities Act of 1933, as amended, the undersigned confirms that such Notes are being transferred in accordance with its terms:
CHECK ONE BOX BELOW:
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(1) |
¨ |
to Burlington or any of its subsidiaries; or |
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(2) |
¨ |
inside the United States to a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act of 1933, as amended) that purchases for its own account or for the account of a qualified institutional buyer to whom notice is |
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|
given that such transfer is being made in reliance on Rule 144A under the Securities Act of 1933, as amended, in each case pursuant to and in compliance with Rule 144A thereunder; or |
|
(3) |
¨ |
outside the United States in an offshore transaction within the meaning of Regulation S under the Securities Act of 1933, as amended, in compliance with Rule 904 thereunder. |
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Unless one of the boxes is checked, the Registrar will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered holder thereof.
|
|
| Signature |
| Signature Guarantee: |
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| (Signature must be guaranteed by a participant in a recognized signature guarantee medallion program) |
TO BE COMPLETED BY PURCHASER IF (2) 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, as amended (“Rule 144A”), 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 Company 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.
| [Name of Transferee] | ||||
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| Dated: | NOTICE: To be executed by an executive officer | |||
A-18
SCHEDULE OF EXCHANGES OF 10.000% Senior Notes
The following exchanges of a part of this Global Note for other 10.000% Senior Notes 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 [ ]% Senior Note Custodian |
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A-19
EXHIBIT B
FORM OF NOTATIONAL GUARANTEE
The Guarantor listed below (hereinafter referred to as the “ Guarantor ,” which term includes any successors or assigns under that certain Indenture, dated as of February 24, 2011, by and among Burlington Coat Factory Warehouse Corporation (the “Company”), the Guarantors party thereto and the Trustee (as amended and supplemented from time to time, the “ Indenture ”) and any additional Guarantors), has guaranteed the Notes and the obligations of the Company under the Indenture, which include (i) the due and punctual payment of the principal of, premium, if any, and interest on the 10.000% Senior Notes due 2019 (the “ Notes ”) of the Company, whether at stated maturity, by acceleration or otherwise, the due and punctual payment of interest on the overdue principal and premium, if any, and (to the extent permitted by law) interest on any interest, if any, on the Notes, and the due and punctual performance of all other obligations of the Company to the Holders or the Trustee all in accordance with the terms set forth in Article XI of the Indenture, (ii) in case of any extension of time of payment or renewal of any Notes or any such other obligations, that the same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise, and (iii) the payment of any and all costs and expenses (including reasonable attorneys’ fees) incurred by the Trustee or any Holder in enforcing any rights under this Guarantee or the Indenture.
The obligations of each Guarantor to the Holders and to the Trustee pursuant to this Guarantee and the Indenture are expressly set forth in Article XI of the Indenture and reference is hereby made to such Indenture for the precise terms of this Guarantee.
No stockholder, employee, officer, director or incorporator, as such, past, present or future of each Guarantor shall have any liability under this Guarantee by reason of his or its status as such stockholder, employee, officer, director or incorporator.
This is a continuing Guarantee and shall remain in full force and effect and shall be binding upon each Guarantor and its successors and assigns until full and final payment of all of the Company’s obligations under the Notes and Indenture or until released in accordance with the Indenture and shall inure to the benefit of the successors and assigns of the Trustee and the Holders, and, in the event of any transfer or assignment of rights by any Holder or the Trustee, the rights and privileges herein conferred upon that party shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions hereof. This is a Guarantee of payment and not of collectibility.
This Guarantee shall not be valid or obligatory for any purpose until the certificate of authentication on the Note upon which this Guarantee is noted shall have been executed by the Trustee under the Indenture by the manual signature of one of its authorized officers. The Obligations of each Guarantor under its Guarantee shall be limited to the extent necessary to insure that it does not constitute a fraudulent conveyance under applicable law.
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THE TERMS OF ARTICLE XI OF THE INDENTURE ARE INCORPORATED HEREIN BY REFERENCE.
Capitalized terms used herein have the same meanings given in the Indenture unless otherwise indicated.
Dated as of
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[Guarantor] |
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By: |
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Name: |
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Title: |
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B-2
EXHIBIT C
[FORM OF CERTIFICATE TO BE DELIVERED
IN CONNECTION WITH TRANSFERS PURSUANT TO RULE 144A]
Burlington Coat Factory Warehouse Corporation
1830 Route 130
Burlington, New Jersey 08016
Fax: (609) 239-9675
Attention: Paul Tang
Wilmington Trust FSB
50 South Sixth Street, Suite 1290
Minneapolis, MN 55402
Fax: (612) 217-5651
Attention: Jane Y. Schweiger
Re: Burlington Coat Factory Warehouse Corporation
10.000% Senior Notes due 2019 (the “Notes”)
Ladies and Gentlemen:
In connection with our proposed sale of $ aggregate principal amount at maturity of the Notes, we hereby certify that such transfer is being effected pursuant to and in accordance with Rule 144A (“Rule 144A”) under the United States Securities Act of 1933, as amended (the “Securities Act”), and, accordingly, we hereby further certify that the Notes are being transferred to a person that we reasonably believe is purchasing the Notes for its own account, or for one or more accounts with respect to which such person exercises sole investment discretion, and such person and each such account is a “qualified institutional buyer” within the meaning of Rule 144A in a transaction meeting the requirements of Rule 144A and such Notes are being transferred in compliance with any applicable blue sky securities laws of any state of the United States.
You and Burlington 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.
| Very truly yours, | ||
| [Name of Transferor] | ||
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By: |
||
| Authorized Signature | ||
C-1
EXHIBIT D
[FORM OF CERTIFICATE TO BE DELIVERED
IN CONNECTION WITH TRANSFERS
PURSUANT TO REGULATION S]
Burlington Coat Factory Warehouse Corporation
1830 Route 130
Burlington, New Jersey 08016
Fax: (609) 239-9675
Attention: Paul Tang
Wilmington Trust FSB
50 South Sixth Street, Suite 1290
Minneapolis, MN 55402
Fax: (612) 217-5651
Attention: Jane Y. Schweiger
Re: Burlington Coat Factory Warehouse Corporation
10.000% Senior Notes due 2019 (the “Notes”)
Ladies and Gentlemen:
In connection with our proposed sale of $ aggregate principal amount of the Notes, 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 Act”), and, accordingly, we represent that:
(1) the offer of the Notes was not made to a person in the United States;
(2) either (a) at the time the buy order 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 off-shore securities market and neither we nor any person acting on our behalf knows that the transaction has been pre-arranged 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(b) or Rule 904(b) of Regulation S, as applicable; and
(4) the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act.
D-1
In addition, if the sale is made during a restricted period and the provisions of Rule 903(b) or Rule 904(b) of Regulation S are applicable thereto, we confirm that such sale has been made in accordance with the applicable provisions of Rule 903(b) or Rule 904(b), as the case may be.
D-2
Burlington and you 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.
| Very truly yours, | ||
| [Name of Transferor] | ||
| By: | ||
| Authorized Signature | ||
D-3
Exhibit 10.1
Burlington Coat Factory Warehouse Corporation
$450,000,000 10.000% Senior Notes due 2019
Exchange and Registration Rights Agreement
February 24, 2011
Goldman, Sachs & Co.,
J.P. Morgan Securities LLC
Merrill Lynch, Pierce, Fenner & Smith Incorporated
Wells Fargo Securities, LLC
as Purchasers
c/o Goldman, Sachs & Co.
200 West Street
New York, New York 10282-2198
Ladies and Gentlemen:
Burlington Coat Factory Warehouse Corporation, a Delaware corporation (the “ Company ”), proposes to issue and sell to the Purchasers (as defined herein) upon the terms set forth in the Purchase Agreement (as defined herein) $450,000,000 in aggregate principal amount of its 10.000% Senior Notes due 2019 , which are guaranteed by the entities listed on Annex A hereto (the “ Guarantors ”). As an inducement to the Purchasers to enter into the Purchase Agreement and in satisfaction of a condition to the obligations of the Purchasers thereunder, the Company and the Guarantors agree with the Purchasers for the benefit of holders (as defined herein) from time to time of the Registrable Securities (as defined herein) as follows:
1. Certain Definitions . For purposes of this Exchange and Registration Rights Agreement (this “ Agreement ”), the following terms shall have the following respective meanings:
“ Base Interest ” shall mean the interest that would otherwise accrue on the Securities under the terms thereof and the Indenture, without giving effect to the provisions of this Agreement.
The term “ broker-dealer ” shall mean any broker or dealer registered with the Commission under the Exchange Act.
“ Business Day ” shall have the meaning set forth in Rule 13e-4(a)(3) promulgated by the Commission under the Exchange Act, as the same may be amended or succeeded from time to time.
“ Closing Date ” shall mean the date on which the Securities are initially issued.
“ Commission ” shall mean the United States Securities and Exchange Commission, or any other federal agency at the time administering the Exchange Act or the Securities Act, whichever is the relevant statute for the particular purpose.
“ EDGAR System ” means the EDGAR filing system of the Commission and the rules and regulations pertaining thereto promulgated by the Commission in Regulation S-T under the Securities Act and the Exchange Act, in each case as the same may be amended or succeeded from time to time (and without regard to format).
“ Effective Time ,” in the case of (i) an Exchange Registration, shall mean the time and date as of which the Commission declares the Exchange Registration Statement effective or as of which the Exchange Registration Statement otherwise becomes effective and (ii) a Shelf Registration, shall mean the time and date as of which the Commission declares the Shelf Registration Statement effective or as of which the Shelf Registration Statement otherwise becomes effective.
“ Electing 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 3(d)(ii) or Section 3(d)(iii) and the instructions set forth in the Notice and Questionnaire.
“ Exchange Act ” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated by the Commission thereunder, as the same may be amended or succeeded from time to time.
“ Exchange Offer ” shall have the meaning assigned thereto in Section 2(a).
“ Exchange Registration ” shall have the meaning assigned thereto in Section 3(c).
“ Exchange Registration Statement ” shall have the meaning assigned thereto in Section 2(a).
“ Exchange Securities ” shall have the meaning assigned thereto in Section 2(a).
“ Guarantor ” shall have the meaning assigned thereto in the Indenture.
The term “ holder ” shall mean each of the Purchasers and other persons who acquire Securities from time to time (including any successors or assigns), in each case for so long as such person owns any Securities.
“ Indenture ” shall mean the indenture, dated as of February 24, 2011, between the Company, the Guarantors and Wilmington Trust FSB, as trustee, as the same may be amended from time to time.
“ Notice and Questionnaire ” means a Notice of Registration Statement and Selling Securityholder Questionnaire substantially in the form of Exhibit A hereto.
The term “ person ” shall mean a corporation, limited liability company, association, partnership, organization, business, individual, government or political subdivision thereof or governmental agency.
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“ Purchase Agreement ” shall mean the Purchase Agreement, dated as of February 17, 2011, between the Purchasers, the Company and the Guarantors relating to the Securities.
“ Purchasers ” shall mean the Purchasers named in Schedule A to the Purchase Agreement.
“ Registrable Securities ” shall mean the Securities; provided , however , that a Security shall cease to be a Registrable Security upon the earliest to occur of the following: (i) in the circumstances contemplated by Section 2(a), the Security has been exchanged for an Exchange Security in an Exchange Offer as contemplated in Section 2(a) (provided that any Exchange Security that, pursuant to the last two sentences of Section 2(a), is included in a prospectus for use in connection with resales by broker-dealers shall be deemed to be a Registrable Security with respect to Sections 5, 6 and 9 until resale of such Registrable Security has been effected within the Resale Period); (ii) in the circumstances contemplated by Section 2(b), a Shelf Registration Statement registering such Security under the Securities Act has been declared or becomes effective and such Security has been sold or otherwise transferred by the holder thereof pursuant to and in a manner contemplated by such effective Shelf Registration Statement; (iii) subject to Section 8(b), such Security is actually sold by the holder thereof pursuant to Rule 144 under circumstances in which any legend borne by such Security relating to restrictions on transferability thereof, under the Securities Act or otherwise, is removed by the Company or pursuant to the Indenture; or (iv) such Security shall cease to be outstanding.
“ Registration Default ” shall have the meaning assigned thereto in Section 2(d).
“ Registration Default Period ” shall have the meaning assigned thereto in Section 2(d).
“ Registration Expenses ” shall have the meaning assigned thereto in Section 4.
“ Resale Period ” shall have the meaning assigned thereto in Section 2(a).
“ Restricted Holder ” shall mean (i) a holder that is an affiliate of the Company within the meaning of Rule 405, (ii) a holder who acquires Exchange Securities outside the ordinary course of such holder’s business, (iii) a holder who has arrangements or understandings with any person to participate in the Exchange Offer for the purpose of distributing Exchange Securities and (iv) a holder that is a broker-dealer, but only with respect to Exchange Securities received by such broker-dealer pursuant to an Exchange Offer in exchange for Registrable Securities acquired by the broker-dealer directly from the Company.
“ Rule 144 ,” “ Rule 405 ”, “ Rule 415 ”, “ Rule 424 ”, “ Rule 430B ” and “ Rule 433 ” shall mean, in each case, such rule promulgated by the Commission under the Securities Act (or any successor provision), as the same may be amended or succeeded from time to time.
“ Securities ” shall mean, collectively, the $450,000,000 in aggregate principal amount of the Company’s 10.000% Senior Notes due 2019 to be issued and sold to the Purchasers, and securities issued in exchange therefor or in lieu thereof pursuant to the Indenture. Each Security is entitled to the benefit of the guarantee provided by the Gua-
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rantors in the Indenture (the “ Guarantee ”) and, unless the context otherwise requires, any reference herein to a “Security,” an “Exchange Security” or a “Registrable Security” shall include a reference to the related Guarantee.
“ Securities Act ” shall mean the Securities Act of 1933, as amended, and the rules and regulations promulgated by the Commission thereunder, as the same may be amended or succeeded from time to time.
“ Shelf Registration ” shall have the meaning assigned thereto in Section 2(b).
“ Shelf Registration Statement ” shall have the meaning assigned thereto in Section 2(b).
“ Special Interest ” shall have the meaning assigned thereto in Section 2(d).
“ Trust Indenture Act ” shall mean the Trust Indenture Act of 1939, as amended, and the rules and regulations promulgated by the Commission thereunder, as the same may be amended or succeeded from time to time.
“ Trustee ” shall mean Wilmington Trust FSB, as trustee under the Indenture, together with any successors thereto in such capacity.
Unless the context otherwise requires, any reference herein to a “Section” or “clause” refers to a Section or clause, as the case may be, of this Agreement, and the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Agreement as a whole and not to any particular Section or other subdivision.
2. Registration Under the Securities Act .
(a) Except as set forth in Section 2(b) below, the Company and the Guarantors agree to file under the Securities Act, a registration statement relating to an offer to exchange (such registration statement, the “ Exchange Registration Statement ”, and such offer, the “ Exchange Offer ”) any and all of the Securities for a like aggregate principal amount of debt securities issued by the Company and guaranteed by the Guarantors, which debt securities and guarantee are substantially identical to the Securities and the related Guarantee, respectively (and are entitled to the benefits of the Indenture), except that they have been registered pursuant to an effective registration statement under the Securities Act and do not contain specified transfer restrictions and provisions for Special Interest contemplated in Section 2(d) below (such new debt securities hereinafter called “Exchange Securities”). The Company and the Guarantors agree to use reasonable best efforts to cause the Exchange Registration Statement to become effective under the Securities Act no later than 365 days after the Closing Date. The Exchange Offer will be registered under the Securities Act on the appropriate form and will comply with all applicable tender offer rules and regulations under the Exchange Act. Unless the Exchange Offer would not be permitted by applicable law or Commission policy, the Company further agrees to use all commercially reasonable efforts to (i) commence the Exchange Offer promptly (but no later than 10 Business Days) following the Effective Time of such Exchange Registration Statement, (ii) hold the Exchange Offer open for at least 20 Business Days in accordance with Regulation 14E promulgated by the Commission under the Exchange Act and (iii) exchange Exchange Securities for all Registrable Securities that have been properly tendered and not withdrawn on or prior to the expiration of the Ex-
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change Offer. The Exchange Offer will be deemed to have been “completed” only (i) if the Exchange Securities received by holders other than Restricted Holders in the Exchange Offer for Registrable Securities are, upon receipt, transferable by each such holder without restriction under the Securities Act and the Exchange Act and without material restrictions under the blue sky or securities laws of a substantial majority of the States of the United States of America and (ii) upon the Company having exchanged, pursuant to the Exchange Offer, Exchange Securities for all Registrable Securities that have been properly tendered and not withdrawn before the expiration of the Exchange Offer, which shall be on a date that is not more than 45 days following the date the Exchange Registration Statement is declared effective. The Company and the Guarantors agree (x) to include in the Exchange Registration Statement a prospectus for use in any resales by any holder of Exchange Securities that is a broker-dealer and (y) to keep such Exchange Registration Statement effective for a period (the “ Resale Period ”) beginning when Exchange Securities are first issued in the Exchange Offer and ending upon the earlier of the expiration of the 180th day after the Exchange Offer has been completed or such time as such broker-dealers no longer own any Registrable Securities. With respect to such Exchange Registration Statement, such holders shall have the benefit of the rights of indemnification and contribution set forth in Subsections 6(a), (c), (d) and (e).
(b) If (i) the Company and the Guarantors are not permitted to consummate the Exchange Offer because of a change in applicable law or Commission interpretations are changed such that the debt securities or the related guarantee received by holders other than Restricted Holders in the Exchange Offer for Registrable Securities are not or would not be, upon receipt, transferable by each such holder without restriction under the Securities Act, (ii) the Exchange Offer has not been completed within 45 days following the date the Exchange Registration Statement is declared effective or (iii) any holder of Registrable Securities notifies the Company prior to the 20th Business Day following the completion of the Exchange Offer that: (A) it is prohibited by law or Commission policy from participating in the Exchange Offer, (B) it may not resell the Exchange Securities to the public without delivering a prospectus and the prospectus contained in the Exchange Registration Statement is not appropriate or available for such resales or (C) it is a broker-dealer and owns Securities acquired directly from the Company or an affiliate of the Company, then the Company and the Guarantors shall, in lieu of (or, in the case of clause (iii), in addition to) conducting the Exchange Offer contemplated by Section 2(a), file under the Securities Act on the date such obligation to file arises, a “shelf” registration statement providing for the registration of, and the sale on a continuous or delayed basis by the holders of, all of the Registrable Securities, pursuant to Rule 415 or any similar rule that may be adopted by the Commission (such filing, the “ Shelf Registration ” and such registration statement, the “ Shelf Registration Statement ”). The Company and the Guarantors agree to use all commercially reasonable efforts to cause the Shelf Registration Statement to become or be declared effective no later than 90 days after such Shelf Registration Statement filing obligation arises (but no earlier than 365 days after the Closing Date); provided , that if at any time the Company is or becomes a “well-known seasoned issuer” (as defined in Rule 405) and is eligible to file an “automatic shelf registration statement” (as defined in Rule 405), then the Company and the Guarantors shall file the Shelf Registration Statement in the form of an automatic shelf registration statement as provided in Rule 405. The Company and the Guarantors agree to use all commercially reasonable efforts to keep such Shelf Registration Statement continuously effective for a period ending on the earlier of the second anniversary of the Effective Time or such time as there are no longer any Registrable Securities outstanding. No
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holder shall be entitled to be named as a selling securityholder in the Shelf Registration Statement or to use the prospectus forming a part thereof for resales of Registrable Securities unless such holder is an Electing Holder. The Company and the Guarantors agree, after the Effective Time of the Shelf Registration Statement and promptly upon the request of any holder of Registrable Securities that is not then an Electing Holder, to use all commercially reasonable efforts to enable such holder to use the prospectus forming a part thereof for resales of Registrable Securities, including, without limitation, any action necessary to identify such holder as a selling securityholder in the Shelf Registration Statement (whether by post-effective amendment thereto or by filing a prospectus pursuant to Rules 430B and 424(b) under the Securities Act identifying such holder), provided, however, that nothing in this sentence shall (A) relieve any such holder of the obligation to return a completed and signed Notice and Questionnaire to the Company in accordance with Section 3(d)(iii) or (B) require the Company or the Guarantors to file more than one post-effective amendment to the Shelf Registration Statement in any 45-day period.
(c) Notwithstanding the foregoing, the Company may issue a notice that the Shelf Registration Statement is no longer effective or the prospectus included therein is no longer usable for offers and sales of Registrable Securities covered by the Shelf Registration Statement for a period not to exceed 60 days in the aggregate in any twelve-month period (a “ Suspension Period ”) if (i) such action is required by applicable law; or (ii) due to the existence of material non-public information, disclosure of such material non-public information would be required to make the statements contained in the applicable registration statement not misleading (including for the avoidance of doubt, the pendancy of an acquisition, disposition or public or private offering by the Company), and the Company has a bona fide business purpose for preserving as confidential such material non-public information (other than avoidance of its obligations hereunder); provided that (x) the Company promptly thereafter complies with the requirements of Section 3(d) hereof and (y) the required period of effectiveness for the Shelf Registration Statement set forth in Section 2(b) hereof shall be extended by the number of days during which such Shelf Registration Statement was not effective or usable pursuant to the foregoing provisions.
(d) In the event that (i) the Company and the Guarantors have not filed the Exchange Registration Statement or the Shelf Registration Statement on or before the date on which such registration statement is required to be filed pursuant to Section 2(a) or Section 2(b), respectively, or (ii) such Exchange Registration Statement or Shelf Registration Statement has not become effective or been declared effective by the Commission on or before the date on which such registration statement is required to become or be declared effective pursuant to Section 2(a) or Section 2(b), respectively, or (iii) the Exchange Offer has not been completed within 45 Business Days after the Effective Time of the Exchange Registration Statement relating to the Exchange Offer (if the Exchange Offer is then required to be made) or (iv) any Exchange Registration Statement or Shelf Registration Statement required by Section 2(a) or Section 2(b) is filed and declared effective but shall thereafter either be withdrawn by the Company or shall become subject to an effective stop order issued pursuant to Section 8(d) of the Securities Act suspending the effectiveness of such registration statement (except as specifically permitted herein) without being succeeded immediately by an additional registration statement filed and declared effective (each such event referred to in clauses (i) through (iv), a “ Registration Default ” and each period during which a Registration Default has occurred and is continuing, a “ Registration Default Period ”), then, as liquidated damages for such
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Registration Default, subject to the provisions of Section 9(b), special interest (“ Special Interest ”), in addition to the Base Interest, shall accrue on all Registrable Securities then outstanding at a per annum rate of 0.25% for the first 90 days of the Registration Default Period, at a per annum rate of 0.50% for the second 90 days of the Registration Default Period, at a per annum rate of 0.75% for the third 90 days of the Registration Default Period and at a per annum rate of 1.0% thereafter for the remaining portion of the Registration Default Period. Special Interest shall accrue and be payable only with respect to a single Registration Default at any given time, notwithstanding the fact that multiple Registration Defaults may exist at such time.
(e) The Company shall take, and shall cause the Guarantors to take, all actions reasonably necessary or advisable to be taken by it to ensure that the transactions contemplated herein are effected as so contemplated, including all actions reasonably necessary or desirable to register the Guarantee under any Exchange Registration Statement or Shelf Registration Statement, as applicable.
(f) Any reference herein to a registration statement or prospectus as of any time shall be deemed to include any document incorporated, or deemed to be incorporated, therein by reference as of such time; and any reference herein to any post-effective amendment to a registration statement or to any prospectus supplement as of any time shall be deemed to include any document incorporated, or deemed to be incorporated, therein by reference as of such time.
3. Registration Procedures .
If the Company and the Guarantors file a registration statement pursuant to Section 2(a) or Section 2(b), the following provisions shall apply:
(a) At or before the Effective Time of the Exchange Registration or any Shelf Registration, whichever may occur first, the Company shall qualify the Indenture under the Trust Indenture Act.
(b) In the event that such qualification would require the appointment of a new trustee under the Indenture, the Company shall appoint a new trustee thereunder pursuant to the applicable provisions of the Indenture.
(c) In connection with the Company’s and the Guarantors’ obligations with respect to the registration of Exchange Securities as contemplated by Section 2(a) (the “ Exchange Registration ”), if applicable, the Company and the Guarantors shall:
(i) use their reasonable best efforts to prepare and file with the Commission, an Exchange Registration Statement on any form which may be utilized by the Company and the Guarantors and which shall permit the Exchange Offer and resales of Exchange Securities by broker-dealers during the Resale Period to be effected as contemplated by Section 2(a), and use all reasonable best efforts to cause such Exchange Registration Statement to become effective no later than 365 days after the Closing Date;
(ii) as soon as practicable prepare and file with the Commission such amendments and supplements to such Exchange Registration Statement and the prospectus included therein as may be necessary to effect and maintain the effectiveness of such Exchange Registration Statement for the periods and purposes contemplated in Sec-
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tion 2(a) and as may be required by the applicable rules and regulations of the Commission and the instructions applicable to the form of such Exchange Registration Statement, and promptly provide each broker-dealer holding Exchange Securities with such number of copies of the prospectus included therein (as then amended or supplemented), in conformity in all material respects with the requirements of the Securities Act and the Trust Indenture Act, as such broker-dealer reasonably may request prior to the expiration of the Resale Period, for use in connection with resales of Exchange Securities;
(iii) promptly notify each broker-dealer that has requested or received copies of the prospectus included in such Exchange Registration Statement, and confirm such advice in writing, (A) when such Exchange Registration Statement or the prospectus included therein or any prospectus amendment or supplement or post-effective amendment has been filed, and, with respect to such Exchange Registration Statement or any post-effective amendment, when the same has become effective, (B) of any comments by the Commission and by the blue sky or securities commissioner or regulator of any state with respect thereto or any request by the Commission for amendments or supplements to such Exchange Registration Statement or prospectus or for additional information, (C) of the issuance by the Commission of any stop order suspending the effectiveness of such Exchange Registration Statement or the initiation or threatening of any proceedings for that purpose, (D) if at any time the representations and warranties of the Company contemplated by Section 5 cease to be true and correct in all material respects, (E) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Exchange Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, (F) the occurrence of any event that causes the Company to become an “ineligible issuer” as defined in Rule 405, or (G) if at any time during the Resale Period when a prospectus is required to be delivered under the Securities Act, that such Exchange Registration Statement, prospectus, prospectus amendment or supplement or post-effective amendment does not conform in all material respects to the applicable requirements of the Securities Act and the Trust Indenture Act or contains an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing;
(iv) in the event that the Company and the Guarantors would be required, pursuant to Section 3(c)(iii)(G), to notify any broker-dealers holding Exchange Securities, promptly prepare and furnish to each such holder a reasonable number of copies of a prospectus supplemented or amended so that, as thereafter delivered to purchasers of such Exchange Securities during the Resale Period, such prospectus shall conform in all material respects to the applicable requirements of the Securities Act and the Trust Indenture Act and shall not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing;
(v) use all commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of such Exchange Registration Statement or any post-effective amendment thereto at the earliest practicable date;
(vi) use all commercially reasonable efforts to (A) register or qualify the Exchange Securities under the securities laws or blue sky laws of such jurisdictions as are contemplated by Section 2(a) no later than the commencement of the Exchange Offer, to the extent required by such laws, (B) keep such registrations or qualifications in effect
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and comply with such laws so as to permit the continuance of offers, sales and dealings therein in such jurisdictions until the expiration of the Resale Period, (C) take any and all other actions as may be reasonably necessary or advisable to enable each broker-dealer holding Exchange Securities to consummate the disposition thereof in such jurisdictions and (D) obtain the consent or approval of each governmental agency or authority, whether federal, state or local, which may be required to effect the Exchange Registration, the Exchange Offer and the offering and sale of Exchange Securities by broker-dealers during the Resale Period; provided , however , that neither the Company nor the Guarantors shall be required for any such purpose to (1) qualify as a foreign corporation in any jurisdiction wherein it would not otherwise be required to qualify but for the requirements of this Section 3(c)(vi), (2) consent to general service of process in any such jurisdiction or become subject to taxation in any such jurisdiction or (3) make any changes to its certificate of incorporation or by-laws or other governing documents or any agreement between it and its stockholders;
(vii) obtain a CUSIP number for all Exchange Securities, not later than the applicable Effective Time; and
(viii) comply with all applicable rules and regulations of the Commission, and make generally available to its securityholders no later than eighteen months after the Effective Time of such Exchange Registration Statement, an “earning statement” of the Company and its subsidiaries complying with Section 11(a) of the Securities Act (including, at the option of the Company, Rule 158 thereunder).
(d) In connection with the Company’s and the Guarantors’ obligations with respect to the Shelf Registration, if applicable, the Company and the Guarantors shall:
(i) prepare and file with the Commission, within the time periods specified in Section 2(b), a Shelf Registration Statement on any form which may be utilized by the Company and which shall register all of the Registrable Securities for resale by the holders thereof in accordance with such method or methods of disposition as may be specified by the holders of Registrable Securities as, from time to time, may be Electing Holders and use all commercially reasonable efforts to cause such Shelf Registration Statement to become effective within the time periods specified in Section 2(b);
(ii) mail the Notice and Questionnaire to the holders of Registrable Securities not less than 30 days prior to the anticipated Effective Time of the Shelf Registration Statement and no holder shall be entitled to be named as a selling securityholder in the Shelf Registration Statement, and no holder shall be entitled to use the prospectus forming a part thereof for resales of Registrable Securities at any time, unless and until such holder has returned a completed and signed Notice and Questionnaire to the Company;
(iii) after the Effective Time of the Shelf Registration Statement, upon the request of any holder of Registrable Securities that is not then an Electing Holder, promptly send a Notice and Questionnaire to such holder; provided that the Company shall not be required (A) to take any action to name such holder as a selling securityholder in the Shelf Registration Statement or to enable such holder to use the prospectus forming a part thereof for resales of Registrable Securities until such holder has returned a completed and signed Notice and Questionnaire to the Company and (B) nothing in this
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clause (iii) shall require the Company or the Guarantors to file more than one post-effective amendment to the Shelf Registration Statement in any 45-day period;
(iv) as soon as practicable prepare and file with the Commission such amendments and supplements to such Shelf Registration Statement and the prospectus included therein as may be necessary to effect and maintain the effectiveness of such Shelf Registration Statement for the period specified in Section 2(b) and as may be required by the applicable rules and regulations of the Commission and the instructions applicable to the form of such Shelf Registration Statement, and furnish to the Electing Holders copies of any such supplement or amendment simultaneously with or prior to its being used or filed with the Commission to the extent such documents are not publicly available on the Commission’s EDGAR System;
(v) comply with the provisions of the Securities Act with respect to the disposition of all of the Registrable Securities covered by such Shelf Registration Statement in accordance with the intended methods of disposition by the Electing Holders provided for in such Shelf Registration Statement;
(vi) provide the Electing Holders and not more than one counsel for all the Electing Holders the opportunity to participate in the preparation of such Shelf Registration Statement, each prospectus included therein or filed with the Commission and each amendment or supplement thereto;
(vii) for a reasonable period prior to the filing of such Shelf Registration Statement, and throughout the period specified in Section 2(b), make available at reasonable times at the Company’s principal place of business or such other reasonable place for inspection by the persons referred to in Section 3(d)(vi) who shall certify to the Company that they have a current intention to sell the Registrable Securities pursuant to the Shelf Registration such financial and other information and books and records of the Company, and cause the officers, employees, counsel and independent certified public accountants of the Company to respond to such inquiries, as shall be reasonably necessary (and in the case of counsel, not violate an attorney-client privilege, in such counsel’s reasonable belief), in the judgment of the respective counsel referred to in Section 3(d)(vi), to conduct a reasonable investigation within the meaning of Section 11 of the Securities Act; provided , however , that the foregoing inspection and information gathering on behalf of the Electing Holders shall be conducted by one counsel designated by the holders of at least a majority in aggregate principal amount of the Registrable Securities held by the Electing Holders at the time outstanding and provided further that each such party shall be required to maintain in confidence and not to disclose to any other person any information or records reasonably designated by the Company as being confidential, until such time as (A) such information becomes a matter of public record (whether by virtue of its inclusion in such Shelf Registration Statement or otherwise), or (B) such person shall be required so to disclose such information pursuant to a subpoena or order of any court or other governmental agency or body having jurisdiction over the matter (subject to the requirements of such order, and only after such person shall have given the Company prompt prior written notice of such requirement), or (C) such information is required to be set forth in such Shelf Registration Statement or the prospectus included therein or in an amendment to such Shelf Registration Statement or an amendment or supplement to such prospectus in order that such Shelf Registration Statement, prospectus, amendment or supplement, as the case may be, complies with applicable requirements of the federal securities laws and the rules and regulations of the Commission
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and does not contain an untrue statement of a material fact or omit to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing;
(viii) promptly notify each of the Electing Holders and confirm such advice in writing, (A) when such Shelf Registration Statement or the prospectus included therein or any prospectus amendment or supplement or post-effective amendment has been filed, and, with respect to such Shelf Registration Statement or any post-effective amendment, when the same has become effective, (B) of any comments by the Commission and by the blue sky or securities commissioner or regulator of any state with respect thereto or any request by the Commission for amendments or supplements to such Shelf Registration Statement or prospectus or for additional information, (C) of the issuance by the Commission of any stop order suspending the effectiveness of such Shelf Registration Statement or the initiation or threatening of any proceedings for that purpose, (D) if at any time the representations and warranties of the Company set forth in Section 5 cease to be true and correct in all material respects, (E) of the receipt by the Company of any notification with respect to the suspension of the qualification of the Registrable Securities for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, (F) the occurrence of any event that causes the Company to become an “ineligible issuer” as defined in Rule 405, or (G) if at any time when a prospectus is required to be delivered under the Securities Act, that such Shelf Registration Statement, prospectus, prospectus amendment or supplement or post-effective amendment does not conform in all material respects to the applicable requirements of the Securities Act and the Trust Indenture Act or contains an untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing;
(ix) use all commercially reasonable efforts to obtain the withdrawal of any order suspending the effectiveness of such Shelf Registration Statement or any post-effective amendment thereto at the earliest practicable date;
(x) if requested by any Electing Holder, promptly incorporate in a prospectus supplement or post-effective amendment such information as is required by the applicable rules and regulations of the Commission and as such Electing Holder specifies should be included therein relating to the terms of the sale of such Registrable Securities, including information with respect to the principal amount of Registrable Securities being sold by such Electing Holder, the name and description of such Electing Holder, the offering price of such Registrable Securities and any discount, commission or other compensation payable in respect thereof and with respect to any other terms of the offering of the Registrable Securities to be sold by such Electing Holder; and make all required filings of such prospectus supplement or post-effective amendment promptly after notification of the matters to be incorporated in such prospectus supplement or post-effective amendment;
(xi) furnish to each Electing Holder and the counsel referred to in Section 3(d)(vi) an executed copy (or a conformed copy) of such Shelf Registration Statement, each such amendment and supplement thereto (in each case including all exhibits thereto (in the case of an Electing Holder of Registrable Securities, upon request) and documents incorporated by reference therein) and such number of copies of such Shelf Registration Statement (excluding exhibits thereto and documents incorporated by reference therein unless specifically so requested by such Electing Holder) and of the
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prospectus included in such Shelf Registration Statement (including each preliminary prospectus and any summary prospectus), in conformity in all material respects with the applicable requirements of the Securities Act and the Trust Indenture Act to the extent such documents are not available through the Commission’s EDGAR System, and such other documents, as such Electing Holder may reasonably request in order to facilitate the offering and disposition of the Registrable Securities owned by such Electing Holder and to permit such Electing Holder to satisfy the prospectus delivery requirements of the Securities Act; and subject to Section 3(e), the Company hereby consents to the use of such prospectus (including such preliminary and summary prospectus) and any amendment or supplement thereto by each such Electing Holder, in each case in the form most recently provided to such person by the Company, in connection with the offering and sale of the Registrable Securities covered by the prospectus (including such preliminary and summary prospectus) or any supplement or amendment thereto;
(xii) use all commercially reasonable efforts to (A) register or qualify the Registrable Securities to be included in such Shelf Registration Statement under such securities laws or blue sky laws of such jurisdictions as any Electing Holder shall reasonably request, (B) keep such registrations or qualifications in effect and comply with such laws so as to permit the continuance of offers, sales and dealings therein in such jurisdictions during the period the Shelf Registration Statement is required to remain effective under Section 2(b) and for so long as may be necessary to enable any such Electing Holder to complete its distribution of Registrable Securities pursuant to such Shelf Registration Statement, (C) take any and all other actions as may be reasonably necessary or advisable to enable each such Electing Holder to consummate the disposition in such jurisdictions of such Registrable Securities and (D) obtain the consent or approval of each governmental agency or authority, whether federal, state or local, which may be required to effect the Shelf Registration or the offering or sale in connection therewith or to enable the selling holder or holders to offer, or to consummate the disposition of, their Registrable Securities; provided , however , that neither the Company nor the Guarantors shall be required for any such purpose to (1) qualify as a foreign corporation in any jurisdiction wherein it would not otherwise be required to qualify but for the requirements of this Section 3(d)(xii), (2) consent to general service of process in any such jurisdiction or become subject to taxation in any such jurisdiction or (3) make any changes to its certificate of incorporation or by-laws or other governing documents or any agreement between it and its stockholders;
(xiii) unless any Registrable Securities shall be in book-entry only form, cooperate with the Electing Holders to facilitate the timely preparation and delivery of certificates representing Registrable Securities to be sold, which certificates, if so required by any securities exchange upon which any Registrable Securities are listed, shall be printed, penned, lithographed, engraved or otherwise produced by any combination of such methods, on steel engraved borders, and which certificates shall not bear any restrictive legends;
(xiv) obtain a CUSIP number for all Registrable Securities that have been registered under the Securities Act, not later than the applicable Effective Time;
(xv) notify in writing each holder of Registrable Securities of any proposal by the Company to amend or waive any provision of this Agreement pursuant to Section 9(h) and of any amendment or waiver effected pursuant thereto, each of which
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notices shall contain the text of the amendment or waiver proposed or effected, as the case may be; and
(xvi) comply with all applicable rules and regulations of the Commission, and make generally available to its securityholders no later than eighteen months after the Effective Time of such Shelf Registration Statement an “earning statement” of the Company and its subsidiaries complying with Section 11(a) of the Securities Act (including, at the option of the Company, Rule 158 thereunder).
(e) In the event that the Company would be required, pursuant to Section 3(d)(viii)(G), to notify the Electing Holders, the Company shall promptly prepare and furnish to each of the Electing Holders a reasonable number of copies of a prospectus supplemented or amended so that, as thereafter delivered to purchasers of Registrable Securities, such prospectus shall conform in all material respects to the applicable requirements of the Securities Act and the Trust Indenture Act and shall not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing. Each Electing Holder agrees that upon receipt of any notice from the Company pursuant to Section 3(d)(viii)(G), such Electing Holder shall forthwith discontinue the disposition of Registrable Securities pursuant to the Shelf Registration Statement applicable to such Registrable Securities until such Electing Holder shall have received copies of such amended or supplemented prospectus, and if so directed by the Company, such Electing Holder shall deliver to the Company (at the Company’s expense) all copies, other than permanent file copies, of the prospectus covering such Registrable Securities in such Electing Holder’s possession at the time of receipt of such notice.
(f) In the event of a Shelf Registration, in addition to the information required to be provided by each Electing Holder in its Notice and Questionnaire, the Company may require such Electing Holder to furnish to the Company such additional information regarding such Electing Holder and such Electing Holder’s intended method of distribution of Registrable Securities as may be required in order to comply with the Securities Act. Each such Electing Holder agrees to notify the Company as promptly as practicable of any inaccuracy or change in information previously furnished by such Electing Holder to the Company or of the occurrence of any event in either case as a result of which any prospectus relating to such Shelf Registration contains or would contain an untrue statement of a material fact regarding such Electing Holder or such Electing Holder’s intended method of disposition of such Registrable Securities or omits to state any material fact regarding such Electing Holder or such Electing Holder’s intended method of disposition of such Registrable Securities required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing, and promptly to furnish to the Company any additional information required to correct and update any previously furnished information or required so that such prospectus shall not contain, with respect to such Electing Holder or the disposition of such Registrable Securities, an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing.
(g) Until the expiration of earlier of one year after the Closing Date and the date on which all Securities have ceased to be Registrable Securities, the Company will not, and will not permit any of its “affiliates” (as defined in Rule 144) to, resell
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any of the Securities that have been reacquired by any of them except pursuant to an effective registration statement, or a valid exemption from the registration requirements, under the Securities Act.
(h) As a condition to its participation in the Exchange Offer, each holder of Registrable Securities shall furnish, upon the request of the Company, a written representation to the Company (which may be contained in the letter of transmittal or “agent’s message” transmitted via The Depository Trust Company’s Automated Tender Offer Procedures, in either case contemplated by the Exchange Registration Statement) to the effect that (A) it is not an “affiliate” of the Company, as defined in Rule 405 of the Securities Act, or if it is such an “affiliate”, it will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable, (B) it is not engaged in and does not intend to engage in, and has no arrangement or understanding with any person to participate in, a distribution of the Exchange Securities to be issued in the Exchange Offer, (C) it is acquiring the Exchange Securities in its ordinary course of business, (D) if it is a broker-dealer that holds Securities that were acquired for its own account as a result of market-making activities or other trading activities (other than Securities acquired directly from the Company or any of its affiliates), it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resales of the Exchange Securities received by it in the Exchange Offer, (E) if it is a broker-dealer, that it did not purchase the Securities to be exchanged in the Exchange Offer from the Company or any of its affiliates, and (F) it is not acting on behalf of any person who could not truthfully and completely make the representations contained in the foregoing subclauses (A) through (E).
4. Registration Expenses .
The Company agrees to bear and to pay or cause to be paid promptly all expenses incident to the Company’s performance of or compliance with this Agreement, including (a) all Commission and any FINRA registration, filing and review fees and expenses including reasonable fees and disbursements of counsel for the Eligible Holders in connection with such registration, filing and review, (b) all fees and expenses in connection with the qualification of the Registrable Securities and the Exchange Securities, as applicable, for offering and sale under the State securities and blue sky laws referred to in Section 3(d)(xii) and determination of their eligibility for investment under the laws of such jurisdictions as the Electing Holders may designate, including any reasonable fees and disbursements of counsel for the Electing Holders in connection with such qualification and determination, (c) all expenses relating to the preparation, printing, production, distribution and reproduction of each registration statement required to be filed hereunder, each prospectus included therein or prepared for distribution pursuant hereto, each amendment or supplement to the foregoing, the expenses of preparing the Securities or Exchange Securities, as applicable, for delivery and the expenses of printing or producing any selling agreements and blue sky or legal investment memoranda and all other documents in connection with the offering, sale or delivery of Securities or Exchange Securities, as applicable, to be disposed of (including certificates representing the Securities or Exchange Securities, as applicable), (d) messenger, telephone and delivery expenses relating to the offering, sale or delivery of Securities or Exchange Securities, as applicable, and the preparation of documents referred in clause (c) above, (e) fees and expenses of the Trustee under the Indenture, any agent of the Trustee and any counsel for the Trustee and of any collateral agent or custodian, (f) internal expenses (including all salaries and
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expenses of the Company’s officers and employees performing legal or accounting duties), (g) reasonable fees, disbursements and expenses of counsel and independent certified public accountants of the Company, (h) reasonable fees, disbursements and expenses of one counsel for the Electing Holders retained in connection with a Shelf Registration, as selected by the Electing Holders of at least a majority in aggregate principal amount of the Registrable Securities held by Electing Holders (which counsel shall be reasonably satisfactory to the Company), (i) any fees charged by securities rating services for rating the Registrable Securities or the Exchange Securities, as applicable, and (j) fees, expenses and disbursements of any other persons, including special experts, retained by the Company in connection with such registration (collectively, the “ Registration Expenses ”). To the extent that any Registration Expenses are incurred, assumed or paid by any holder of Registrable Securities, Securities or Exchange Securities, as applicable, the Company shall reimburse such person for the full amount of the Registration Expenses so incurred, assumed or paid promptly after receipt of a request therefor. Notwithstanding the foregoing, the holders of the Registrable Securities being registered shall pay all agency fees and commissions and underwriting discounts and commissions, if any, and transfer taxes, if any, attributable to the sale of such Registrable Securities and Exchange Securities, as applicable, and the fees and disbursements of any counsel or other advisors or experts retained by such holders (severally or jointly), other than the counsel and experts specifically referred to above.
5. Representations and Warranties .
Each of the Company and the Guarantors, jointly and severally, represents and warrants to, and agrees with, each Purchaser and each of the holders from time to time of Registrable Securities that:
(a) Each registration statement covering Registrable Securities, Securities or Exchange Securities, as applicable, and each prospectus (including any preliminary or summary prospectus) contained therein or furnished pursuant to Section 3(c) or Section 3(d) and any further amendments or supplements to any such registration statement or prospectus, when it becomes effective or is filed with the Commission, as the case may be, will conform in all material respects to the requirements of the Securities Act and the Trust Indenture Act and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; and at all times subsequent to the Effective Time when a prospectus would be required to be delivered under the Securities Act, other than from (i) such time as a notice has been given to holders of Registrable Securities pursuant to Section 3(c)(iii)(G) or Section 3(d)(viii)(G) until (ii) such time as the Company furnishes an amended or supplemented prospectus pursuant to Section 3(c)(iv) or Section 3(e) or (B) during any applicable Suspension Period, each such registration statement, and each prospectus (including any summary prospectus) contained therein or furnished pursuant to Section 3(c) or Section 3(d), as then amended or supplemented, will conform in all material respects to the requirements of the Securities Act and the Trust Indenture Act and will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing; provided , however , that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by a holder of Registrable Securities expressly for use therein.
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(b) Any documents incorporated by reference in any prospectus referred to in Section 5(a), when they become or became effective or are or were filed with the Commission, as the case may be, will conform or conformed in all material respects to the requirements of the Securities Act or the Exchange Act, as applicable, and none of such documents will contain or contained an untrue statement of a material fact or will omit or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided , however , that this representation and warranty shall not apply to any statements or omissions made in reliance upon and in conformity with information furnished in writing to the Company by a holder of Registrable Securities expressly for use therein.
(c) The compliance by the Company with all of the provisions of this Agreement and the consummation of the transactions herein contemplated will not, except as could not reasonably be expected to have a Material Adverse Change (as defined in the Purchase Agreement) (i) conflict with or result in a breach or violation of any of the terms or provisions of, or constitute a default under, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument to which the Company or any of its subsidiaries is a party or by which the Company or any of its subsidiaries is bound or to which any of the property or assets of the Company or any of its subsidiaries is subject, (ii) result in any violation of the provisions of the certificate of incorporation, as amended, or the by-laws or other governing documents, as applicable, of the Company or the Guarantors or (iii) result in any violation of any statute or any order, rule or regulation of any court or governmental agency or body having jurisdiction over the Company or any of its subsidiaries or any of their respective properties; and no consent, approval, authorization, order, registration or qualification of or with any such court or governmental agency or body is required for the consummation by the Company and the Guarantors of the transactions contemplated by this Agreement, except (x) the registration under the Securities Act of the Registrable Securities and the Exchange Securities, as applicable, and qualification of the Indenture under the Trust Indenture Act, (y) such consents, approvals, authorizations, registrations or qualifications as may be required under state securities or blue sky laws in connection with the offering and distribution of the Registrable Securities and the Exchange Securities, as applicable, and (z) such consents, approvals, authorizations, registrations or qualifications that have been obtained and are in full force and effect as of the date hereof.
(d) This Agreement has been duly authorized, executed and delivered by the Company and by the Guarantors.
6. Indemnification and Contribution .
(a) Indemnification by the Company and the Guarantors . The Company and the Guarantors, jointly and severally, will indemnify and hold harmless each of the holders of Registrable Securities included in an Exchange Registration Statement and each of the Electing Holders as holders of Registrable Securities included in a Shelf Registration Statement against any losses, claims, damages or liabilities, joint or several, to which such holder or such Electing Holder may become subject under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon (1) an untrue statement or alleged untrue statement of a material fact contained in any Exchange Registration Statement or any Shelf Registration Statement, as the case may be, under which such Registrable Securities or Exchange Securities were registered under the Securities Act, or any omission or alleged omission to
-16-
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 preliminary, final or summary prospectus (including, without limitation, any “issuer free writing prospectus” as defined in Rule 433) contained in any Exchange Registration Statement or any Shelf Registration Statement or furnished by the Company to any such holder or any such Electing Holder, or any amendment or supplement thereto, 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, and in each case, will reimburse each such holder and each such Electing Holder for any and all legal or other expenses reasonably incurred by them in connection with investigating or defending any such action or claim as such expenses are incurred; provided , however , that neither the Company nor the Guarantors shall be liable to any such person in any such case to the extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement or omission or alleged omission made in such registration statement, or preliminary, final or summary prospectus (including, without limitation, any “issuer free writing prospectus” as defined in Rule 433), or amendment or supplement thereto, in reliance upon and in conformity with written information furnished to the Company by such person expressly for use therein.
(b) Indemnification by the Electing Holders . The Company may require, as a condition to including any Registrable Securities in any Shelf Registration Statement filed pursuant to Section 2(b), that the Company shall have received an undertaking reasonably satisfactory to it from each Electing Holder of Registrable Securities included in such Shelf Registration Statement, severally and not jointly, to (i) indemnify and hold harmless the Company, the Guarantors and all other Electing Holders of Registrable Securities included in such Shelf Registration Statement, against any losses, claims, damages or liabilities to which the Company, the Guarantors or such other Electing Holders may become subject, under the Securities Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon (1) an untrue statement or alleged untrue statement of a material fact contained in any such 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 preliminary, final or summary prospectus (including, without limitation, any “issuer free writing prospectus” as defined in Rule 433) contained therein or furnished by the Company to any Electing Holder, or any amendment or supplement thereto, 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 to the extent, but only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Company by such Electing Holder expressly for use therein, and (ii) reimburse the Company and the Guarantors for any legal or other expenses reasonably incurred by the Company and the Guarantors in connection with investigating or defending any such action or claim as such expenses are incurred; provided, however, that no such Electing Holder shall be required to undertake liability to any person under this Section 6(b)(i) for any amounts in excess of the dollar amount of the proceeds to be received by such Electing Holder from the sale of such Electing Holder’s Registrable Securities pursuant to such registration.
-17-
(c) Notices of Claims, Etc . Promptly after receipt by an indemnified party under subsection (a) or (b) above of written notice of the commencement of any action, such indemnified party shall, if a claim in respect thereof is to be made against an indemnifying party pursuant to the indemnification provisions of or contemplated by this Section 6, notify such indemnifying party in writing of the commencement of such action; but the omission so to notify the indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under the indemnification provisions of or contemplated by Section 6(a) or Section 6(b) or to the extent it is not prejudiced as a proximate result of such failure. In case any such action shall be brought against any indemnified party and it shall notify an indemnifying party of the commencement thereof, such indemnifying party shall be entitled to participate therein and, to the extent that it shall wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and, after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, such indemnifying party shall not be liable to such indemnified party for any legal expenses of other counsel or any other expenses, in each case subsequently incurred by such indemnified party, in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the prior written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (i) includes an unconditional release of the indemnified party from all liability arising out of such action or claim and (ii) does not include a statement as to, or an admission of, fault, culpability or a failure to act by or on behalf of any indemnified party.
(d) Contribution . If for any reason the indemnification provisions contemplated by Section 6(a) or Section 6(b) are unavailable to or insufficient to hold harmless an indemnified party in respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to therein, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect thereof) in such proportion as is appropriate to reflect the relative fault of the indemnifying party and the indemnified party in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities (or actions in respect thereof), as well as any other relevant equitable considerations. The relative fault of such indemnifying party and indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or omission or alleged omission to state a material fact relates to information supplied by such indemnifying party or by such indemnified party, and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. The parties hereto agree that it would not be just and equitable if contributions pursuant to this Section 6(d) 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 which does not take account of the equitable considerations referred to in this Section 6(d). The amount paid or payable by an indemnified party as a result of the losses, claims, damages, or liabilities (or actions in respect thereof) referred to above shall be deemed to include any legal or other fees or expenses reasonably incurred by such indemnified party in connection with investigating or defending any such action or
-18-
claim. Notwithstanding the provisions of this Section 6(d), no Electing Holder shall be required to contribute any amount in excess of the amount by which the dollar amount of the proceeds received by such holder from the sale of any Registrable Securities (after deducting any fees, discounts and commissions applicable thereto) exceeds the amount of any damages which 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 in this Section 6(d) to contribute shall be several in proportion to the principal amount of Registrable Securities registered by them and not joint.
(e) The obligations of the Company and the Guarantors under this Section 6 shall be in addition to any liability which the Company or the Guarantors may otherwise have and shall extend, upon the same terms and conditions, to each officer, director and partner of each holder, each Electing Holder, and each person, if any, who controls any of the foregoing within the meaning of the Securities Act; and the obligations of the holders and the Electing Holders contemplated by this Section 6 shall be in addition to any liability which the respective holder or Electing Holder may otherwise have and shall extend, upon the same terms and conditions, to each officer and director of the Company or the Guarantors and to each person, if any, who controls the Company within the meaning of the Securities Act, as well as to each officer and director of the other holders and to each person, if any, who controls such other holders within the meaning of the Securities Act.
7. Underwritten Offerings .
Each holder of Registrable Securities hereby agrees with the Company and each other such holder that no holder of Registrable Securities may participate in any underwritten offering hereunder unless (a) the Company gives its prior written consent to such underwritten offering, (b) the managing underwriter or underwriters thereof shall be designated by Electing Holders holding at least a majority in aggregate principal amount of the Registrable Securities to be included in such offering, provided that such designated managing underwriter or underwriters is or are reasonably acceptable to the Company, (c) each holder of Registrable Securities participating in such underwritten offering agrees to sell such holder’s Registrable Securities on the basis provided in any underwriting arrangements approved by the persons entitled selecting the managing underwriter or underwriters hereunder and (d) each holder of Registrable Securities participating in such underwritten offering completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements. The Company hereby agrees with each holder of Registrable Securities that, to the extent it consents to an underwritten offering hereunder, it will negotiate in good faith and execute all indemnities, underwriting agreements and other documents reasonably required under the terms of such underwriting arrangements, including using all commercially reasonable efforts to procure customary legal opinions and auditor “comfort” letters.
8. Rule 144 .
(a) Facilitation of Sales Pursuant to Rule 144 . The Company covenants to the holders of Registrable Securities that to the extent it shall be required to do so under the Exchange Act, the Company shall timely file the reports required to be filed by it un-
-19-
der the Exchange Act or the Securities Act (including the reports under Sections 13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144), and shall take such further action as any holder of Registrable Securities may reasonably request, all to the extent required from time to time to enable such holder to sell Registrable Securities without registration under the Securities Act within the limitations of the exemption provided by Rule 144. Upon the request of any holder of Registrable Securities in connection with that holder’s sale pursuant to Rule 144, the Company shall deliver to such holder a written statement as to whether it has complied with such requirements.
(b) Availability of Rule 144 Not Excuse for Obligations under Section 2 . The fact that holders of Registrable Securities may become eligible to sell such Registrable Securities pursuant to Rule 144 shall not (1) cause such Securities to cease to be Registrable Securities or (2) excuse the Company’s and the Guarantors’ obligations set forth in Section 2 of this Agreement, including without limitation the obligations in respect of an Exchange Offer, Shelf Registration and Special Interest.
9. Miscellaneous .
(a) No Inconsistent Agreements . The Company represents, warrants, covenants and agrees that it has not granted, and shall not grant, registration rights with respect to Registrable Securities, Exchange Securities or Securities, as applicable, or any other securities which would be inconsistent with the terms contained in this Agreement.
(b) Specific Performance . The parties hereto acknowledge that there would be no adequate remedy at law if the Company fails to perform any of its obligations hereunder and that the Purchasers and the holders from time to time of the Registrable Securities may be irreparably harmed by any such failure, and accordingly agree that the Purchasers and such holders, in addition to any other remedy to which they may be entitled at law or in equity, shall be entitled to compel specific performance of the obligations of the Company under this Agreement in accordance with the terms and conditions of this Agreement, in any court of the United States or any State thereof having jurisdiction. Time shall be of the essence in this Agreement.
(c) Notices . All notices, requests, claims, demands, waivers and other communications hereunder shall be in writing and shall be deemed to have been duly given when delivered by hand, if delivered personally, by facsimile or by courier, or three days after being deposited in the mail (registered or certified mail, postage prepaid, return receipt requested) as follows: If to the Company, to it at 1830 Route 130 North, Burlington, New Jersey 08016, Attention: General Counsel, and if to a holder, to the address of such holder set forth in the security register or other records of the Company, or to such other address as the Company or any such holder may have furnished to the other in writing in accordance herewith, except that notices of change of address shall be effective only upon receipt.
(d) Parties in Interest . All the terms and provisions of this Agreement shall be binding upon, shall inure to the benefit of and shall be enforceable by the parties hereto, the holders from time to time of the Registrable Securities and the respective successors and assigns of the foregoing. In the event that any transferee of any holder of Registrable Securities shall acquire Registrable Securities, in any manner, whether by gift, bequest, purchase, operation of law or otherwise, such transferee shall, without any further writing or action of any kind, be deemed a beneficiary hereof for all purposes and such
-20-
Registrable Securities shall be held subject to all of the terms of this Agreement, and by taking and holding such Registrable Securities such transferee shall be entitled to receive the benefits of, and be conclusively deemed to have agreed to be bound by all of the applicable terms and provisions of this Agreement. If the Company shall so request, any such successor, assign or transferee shall agree in writing to acquire and hold the Registrable Securities subject to all of the applicable terms hereof.
(e) Survival . The respective indemnities, agreements, representations, warranties and each other provision set forth in this Agreement or made pursuant hereto shall remain in full force and effect regardless of any investigation (or statement as to the results thereof) made by or on behalf of any holder of Registrable Securities, any director, officer or partner of such holder or any controlling person of any of the foregoing, and shall survive delivery of and payment for the Registrable Securities pursuant to the Purchase Agreement, the transfer and registration of Registrable Securities by such holder and the consummation of an Exchange Offer.
(f) Governing Law . This Agreement shall be governed by and construed in accordance with the laws of the State of New York.
(g) Headings . The descriptive headings of the several Sections and paragraphs of this Agreement are inserted for convenience only, do not constitute a part of this Agreement and shall not affect in any way the meaning or interpretation of this Agreement.
(h) Entire Agreement; Amendments . This Agreement and the other writings referred to herein (including the Indenture and the form of Securities) or delivered pursuant hereto which form a part hereof contain the entire understanding of the parties with respect to its subject matter. This Agreement supersedes all prior agreements and understandings between the parties with respect to its subject matter. This Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only by a written instrument duly executed by the Company and the holders of at least a majority in aggregate principal amount of the Registrable Securities at the time outstanding. Each holder of any Registrable Securities at the time or thereafter outstanding shall be bound by any amendment or waiver effected pursuant to this Section 9(h), whether or not any notice, writing or marking indicating such amendment or waiver appears on such Registrable Securities or is delivered to such holder.
(i) Inspection . For so long as this Agreement shall be in effect, this Agreement and a complete list of the names and addresses of all the record holders of Registrable Securities shall be made available for inspection and copying on any Business Day by any holder of Registrable Securities for proper purposes only (which shall include any purpose related to the rights of the holders of Registrable Securities under the Securities, the Indenture and this Agreement) at the offices of the Company at the address thereof set forth in Section 9(c) and at the office of the Trustee under the Indenture.
(j) Counterparts . This Agreement may be executed by the parties in counterparts, each of which shall be deemed to be an original, but all such respective counterparts shall together constitute one and the same instrument.
-21-
(k) Severability . If any provision of this Agreement, or the application thereof in any circumstance, is held to be invalid, illegal or unenforceable in any respect for any reason, the validity, legality and enforceability of such provision in every other respect and of the remaining provisions contained in this Agreement shall not be affected or impaired thereby.
-22-
If the foregoing is in accordance with your understanding, please sign and return to us counterparts hereof, and upon the acceptance hereof by you, on behalf of each of the Purchasers, this letter and such acceptance hereof shall constitute a binding agreement between each of the Purchasers, the Guarantors and the Company. It is understood that your acceptance of this letter on behalf of each of the Purchasers is pursuant to the authority set forth in a form of Agreement among Purchasers, the form of which shall be submitted to the Company for examination upon request, but without warranty on your part as to the authority of the signers thereof.
Very truly yours,
|
Burlington Coat Factory Warehouse Corporation |
||
| By: |
/s/ Robert LaPenta, Jr. |
|
| Name: | Robert LaPenta, Jr. | |
| Title: | Vice President and Treasurer | |
|
Each of the guarantors listed on Annex A hereto, |
||
| as Guarantors | ||
| By: |
/s/ Robert LaPenta, Jr. |
|
| Name: | Robert LaPenta, Jr. | |
| Title: | Vice President and Treasurer |
| Accepted as of the date hereof: | ||
| Goldman, Sachs & Co. | ||
| By: |
Goldman, Sachs & Co. |
|
| (Goldman, Sachs & Co.) | ||
| On behalf of each of the Purchasers | ||
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| Wells Fargo Securities, LLC | ||
| By: |
/s/ Chris McCoy |
|
| Name: | Chris McCoy | |
| Title: | Director | |
-24-
| Merrill Lynch, Pierce, Fenner & Smith Incorporated | ||
| By: |
/s/ Michelle Koren |
|
| Name: | Michelle Koren | |
| Title: | Vice President | |
-25-
ANNEX A
|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory of Alabama, LLC |
Alabama | |
|
Burlington Coat Factory Realty of Huntsville, LLC |
Alabama | |
|
Burlington Coat Factory Warehouse of Anchorage, Inc. |
Alaska | |
|
Burlington Coat Factory Realty of Mesa, Inc. |
Arizona | |
|
Burlington Coat Factory Realty of Desert Sky, Inc. |
Arizona | |
|
Burlington Coat Factory of Arizona, LLC |
Arizona | |
|
Burlington Coat Factory of Arkansas, LLC |
Arkansas | |
|
Burlington Coat Factory Realty of Dublin, Inc. |
California | |
|
Burlington Coat Factory Realty of Florin, Inc. |
California | |
|
Burlington Coat Factory Realty of Ventura, Inc. |
California | |
|
Baby Depot of California, LLC |
California | |
|
Burlington Coat Factory of California, LLC |
California | |
|
Burlington Coat Factory of San Bernardino, LLC |
California | |
|
MJM Designer Shoes of California, LLC |
California | |
|
Burlington Coat Factory of Colorado, LLC |
Colorado | |
|
Burlington Coat Realty of East Windsor, Inc. |
Connecticut | |
|
Burlington Coat Factory of Connecticut, LLC |
Connecticut | |
|
Cohoes Fashions of Connecticut, LLC |
Connecticut | |
|
Burlington Coat Factory of Texas, Inc. |
Delaware | |
|
C.F.I.C. Corporation |
Delaware | |
|
Burlington Coat Factory Realty Corp. |
Delaware | |
|
Burlington Coat Factory of Delaware, LLC |
Delaware | |
|
MJM Designer Shoes of Delaware, LLC |
Delaware | |
|
Burlington Coat Factory Investments Holdings, Inc. |
Delaware | |
|
Burlington Coat Factory of Texas, L.P. |
Delaware | |
|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory Realty of University Square, Inc. |
Florida | |
|
Burlington Coat Factory Realty of Coral Springs, Inc. |
Florida | |
|
Burlington Coat Factory Realty of West Colonial, Inc. |
Florida | |
|
Burlington Coat Factory Realty of Orlando, Inc. |
Florida | |
|
Burlington Coat Factory Realty of Sarasota, Inc. |
Florida | |
|
K&T Acquisition Corp. |
Florida | |
|
Burlington Coat Factory of Florida, LLC |
Florida | |
|
MJM Designer Shoes of Florida, LLC |
Florida | |
|
Bee Ridge Plaza, LLC |
Florida | |
|
Burlington Coat Factory Warehouse of Atlanta, Inc. |
Georgia | |
|
Burlington Coat Factory Realty of Morrow, Inc. |
Georgia | |
|
Burlington Coat Factory of Georgia, LLC |
Georgia | |
|
Burlington Coat Factory of Hawaii, LLC |
Hawaii | |
|
Burlington Coat Factory of Idaho, LLC |
Idaho | |
|
Burlington Coat Factory Warehouse of East St. Louis, Inc. |
Illinois | |
|
Burlington Coat Realty of Gurnee, Inc. |
Illinois | |
|
Burlington Coat Factory Realty of Bloomingdale, Inc. |
Illinois | |
|
Burlington Coat Factory Realty of River Oaks, Inc. |
Illinois | |
|
Burlington Coat Factory of Illinois, LLC |
Illinois | |
|
Burlington Coat Factory Realty of Greenwood, Inc. |
Indiana | |
|
Burlington Coat Factory of Indiana, LLC |
Indiana | |
|
Burlington Coat Factory of Iowa, LLC |
Iowa | |
|
Burlington Coat Factory of Kansas, LLC |
Kansas | |
|
Burlington Coat Factory of Kentucky, Inc. |
Kentucky | |
|
Burlington Coat Factory of Louisiana, LLC |
Louisiana | |
|
Burlington Coat Factory of Maine, LLC |
Maine | |
-2-
|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory of Maryland, LLC |
Maryland | |
|
Burlington Coat Factory Realty of North Attleboro, Inc. |
Massachusetts | |
|
Burlington Coat Factory of Massachusetts, LLC |
Massachusetts | |
|
Cohoes Fashions of Massachusetts, LLC |
Massachusetts | |
|
Burlington Coat Factory Warehouse of Detroit, Inc. |
Michigan | |
|
Burlington Coat Factory Warehouse of Grand Rapids, Inc. |
Michigan | |
|
Burlington Coat Factory Warehouse of Redford, Inc. |
Michigan | |
|
Burlington Coat Factory of Michigan, LLC |
Michigan | |
|
Burlington Coat Factory of Minnesota, LLC |
Minnesota | |
|
Burlington Coat Factory of Mississippi, LLC |
Mississippi | |
|
Burlington Coat Factory Realty of Des Peres, Inc. |
Missouri | |
|
Burlington Coat Factory of Missouri, LLC |
Missouri | |
|
Burlington Coat Factory of Montana, LLC |
Montana | |
|
Burlington Coat Factory of Nebraska, LLC |
Nebraska | |
|
Burlington Coat Realty of Las Vegas, Inc. |
Nevada | |
|
Burlington Coat Factory of Nevada, LLC |
Nevada | |
|
Burlington Coat Factory of New Hampshire, LLC |
New Hampshire | |
|
Burlington Coat Factory Direct Corporation |
New Jersey | |
|
Burlington Coat Factory Warehouse of Edgewater Park, Inc. |
New Jersey | |
|
Burlington Coat Factory Warehouse of New Jersey, Inc. |
New Jersey | |
|
MJM Designer Shoes of Moorestown, Inc. |
New Jersey | |
|
Super Baby Depot of Moorestown, Inc. |
New Jersey | |
|
Burlington Coat Factory Realty of Edgewater Park, Inc. |
New Jersey | |
|
Burlington Coat Factory Realty of Paramus, Inc. |
New Jersey | |
|
Burlington Coat Factory Realty of Pinebrook, Inc. |
New Jersey | |
|
Burlington Coat Factory Warehouse of Edgewater Park Urban Renewal Corp. |
New Jersey | |
-3-
|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory of New Jersey, LLC |
New Jersey | |
|
Cohoes Fashions of New Jersey, LLC |
New Jersey | |
|
MJM Designer Shoes of New Jersey, LLC |
New Jersey | |
|
Burlington Coat Factory of New Mexico, LLC |
New Mexico | |
|
LC Acquisition Corp. |
New York | |
|
Georgetown Fashions Inc. |
New York | |
|
Monroe G. Milstein, Inc. |
New York | |
|
Burlington Coat Factory Realty of Yonkers, Inc. |
New York | |
|
Burlington Coat Factory of New York, LLC |
New York | |
|
Cohoes Fashions of New York, LLC |
New York | |
|
MJM Designer Shoes of New York, LLC |
New York | |
|
Burlington Coat Factory of North Carolina, LLC |
North Carolina | |
|
Burlington Coat Factory of North Dakota, LLC |
North Dakota | |
|
Burlington Coat Factory Warehouse of Cleveland, Inc. |
Ohio | |
|
Burlington Coat Factory of Ohio, LLC |
Ohio | |
|
Burlington Coat Factory Realty of Tulsa, Inc. |
Oklahoma | |
|
Burlington Coat Factory of Oklahoma, LLC |
Oklahoma | |
|
Burlington Coat Factory of Oregon, LLC |
Oregon | |
|
Burlington Coat Factory Warehouse Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Cheltenham, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Langhorne, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Warehouse of Montgomeryville, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Realty of West Mifflin, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Realty of Langhorne, Inc. |
Pennsylvania | |
|
Burlington Coat Factory Realty of Whitehall, Inc. |
Pennsylvania | |
|
Burlington Factory Warehouse of Reading, Inc. |
Pennsylvania | |
-4-
|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory Warehouse of Bristol, LLC |
Pennsylvania | |
|
Burlington Coat Factory of Pennsylvania, LLC |
Pennsylvania | |
|
MJM Designer Shoes of Pennsylvania, LLC |
Pennsylvania | |
|
Burlington Coat Factory of Puerto Rico, LLC |
Puerto Rico | |
|
Cohoes Fashions of Cranston, Inc. |
Rhode Island | |
|
Burlington Coat Factory of Rhode Island, LLC |
Rhode Island | |
|
Burlington Coat Factory Warehouse of Charleston, Inc. |
South Carolina | |
|
Burlington Coat Factory of South Carolina, LLC |
South Carolina | |
|
Burlington Coat Factory of South Dakota, LLC |
South Dakota | |
|
Burlington Coat Factory Warehouse of Hickory Commons, Inc. |
Tennessee | |
|
Burlington Coat Factory Warehouse of Memphis, Inc. |
Tennessee | |
|
Burlington Coat Factory Warehouse of Shelby, Inc. |
Tennessee | |
|
Burlington Coat Factory Realty of Memphis, Inc. |
Tennessee | |
|
Burlington Coat Realty of Plano, Inc. |
Texas | |
|
Burlington Coat Factory Warehouse of Baytown, Inc. |
Texas | |
|
M J M Designer Shoes of Texas, Inc. |
Texas | |
|
Burlington Coat Realty of Houston, Inc. |
Texas | |
|
Burlington Coat Factory Realty of Westmoreland, Inc. |
Texas | |
|
Burlington Coat Factory Realty of Bellaire, Inc. |
Texas | |
|
Burlington Coat Factory Realty of El Paso, Inc. |
Texas | |
|
Burlington Coat Factory of Utah, LLC |
Utah | |
|
Burlington Coat Factory of Vermont, LLC |
Vermont | |
|
BCF Cards, Inc. |
Virginia | |
|
Burlington Coat Factory Warehouse of Coliseum, Inc. |
Virginia | |
|
Burlington Coat Realty of Potomac, Inc. |
Virginia | |
|
Burlington Coat Factory Realty of Fairfax, Inc. |
Virginia | |
-5-
|
Guarantors |
Jurisdiction of Organization |
|
|
Burlington Coat Factory Realty of Coliseum, Inc. |
Virginia | |
|
Burlington Coat Factory of Virginia, LLC |
Virginia | |
|
Burlington Coat Factory of Pocono Crossing, LLC |
Virginia | |
|
Burlington Coat Factory Realty of Franklin, Inc. |
Washington | |
|
Burlington Coat Factory of Washington, LLC |
Washington | |
|
Burlington Coat Factory of West Virginia, LLC |
West Virginia | |
|
Burlington Coat Factory of Wisconsin, LLC |
Wisconsin | |
-6-
Exhibit A
Burlington Coat Factory Warehouse Corporation
INSTRUCTION TO DTC PARTICIPANTS
(Date of Mailing)
URGENT - IMMEDIATE ATTENTION REQUESTED
DEADLINE FOR RESPONSE: [DATE] a
The Depository Trust Company (“ DTC ”) has identified you as a DTC Participant through which beneficial interests in the Burlington Coat Factory Warehouse Corporation (the “ Company ”) Senior Notes due 2019 (the “ Securities ”) are held.
The Company is in the process of registering the Securities under the Securities Act of 1933 for resale by the beneficial owners thereof. In order to have their Securities included in the registration statement, beneficial owners must complete and return the enclosed Notice of Registration Statement and Selling Securityholder Questionnaire.
It is important that beneficial owners of the Securities receive a copy of the enclosed materials as soon as possible as their rights to have the Securities included in the registration statement depend upon their returning the Notice and Questionnaire by [Deadline For Response] . Please forward a copy of the enclosed documents to each beneficial owner that holds interests in the Securities through you. If you require more copies of the enclosed materials or have any questions pertaining to this matter, please contact Burlington Coat Factory Warehouse Corporation, 1830 Route 130 North, Burlington, New Jersey 08016, Attention: General Counsel [Telephone Number] .
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Not less than 28 calendar days from date of mailing. |
A-1
Burlington Coat Factory Warehouse Corporation
Notice of Registration Statement
and
Selling Securityholder Questionnaire
(Date)
Reference is hereby made to the Exchange and Registration Rights Agreement (the “ Exchange and Registration Rights Agreement ”) between Burlington Coat Factory Warehouse Corporation (the “ Company ”) and the Purchasers named therein. Pursuant to the Exchange and Registration Rights Agreement, the Company has filed or will file with the United States Securities and Exchange Commission (the “ Commission ”) a registration statement on Form [ __ ] (the “ Shelf Registration Statement ”) for the registration and resale under Rule 415 of the Securities Act of 1933, as amended (the “ Securities Act ”), of the Company’s Senior Notes due 2019 (the “ Securities ”). A copy of the Exchange and Registration Rights Agreement has been filed as an exhibit to the Shelf Registration Statement and can be obtained from the Commission’s website at www.sec.gov. All capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Exchange and Registration Rights Agreement.
Each beneficial owner of Registrable Securities (as defined below) is entitled to have the Registrable Securities beneficially owned by it included in the Shelf Registration Statement. In order to have Registrable Securities included in the Shelf Registration Statement, this Notice of Registration Statement and Selling Securityholder Questionnaire (“ Notice and Questionnaire ”) must be completed, executed and delivered to the Company’s counsel at the address set forth herein for receipt ON OR BEFORE [Deadline for Response] . Beneficial owners of Registrable Securities who do not properly complete, execute and return this Notice and Questionnaire by such date (i) will not be named as selling securityholders in the Shelf Registration Statement and (ii) may not use the Prospectus forming a part thereof for resales of Registrable Securities.
Certain legal consequences arise from being named as a selling securityholder in the Shelf Registration Statement and related Prospectus. Accordingly, holders and beneficial owners of Registrable Securities are advised to consult their own securities law counsel regarding the consequences of being named or not being named as a selling securityholder in the Shelf Registration Statement and related Prospectus.
The term “ Registrable Securities ” is defined in the Exchange and Registration Rights Agreement.
A-2
ELECTION
The undersigned holder (the “ Selling Securityholder ”) of Registrable Securities hereby elects to include in the Shelf Registration Statement the Registrable Securities beneficially owned by it and listed below in Item (3). The undersigned, by signing and returning this Notice and Questionnaire, agrees to be bound with respect to such Registrable Securities by the terms and conditions of this Notice and Questionnaire and the Exchange and Registration Rights Agreement, including, without limitation, Section 6 of the Exchange and Registration Rights Agreement, as if the undersigned Selling Securityholder were an original party thereto.
Pursuant to the Exchange and Registration Rights Agreement, the undersigned has agreed to indemnify and hold harmless the Company, its officers who sign any Shelf Registration Statement, and each person, if any, who controls the Company within the meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act of 1934, as amended (the “ Exchange Act ”), against certain loses arising out of an untrue statement, or the alleged untrue statement, of a material fact in the Shelf Registration Statement or the related prospectus or the omission, or alleged omission, to state a material fact required to be stated in such Shelf Registration Statement or the related prospectus, but only to the extent such untrue statement or omission, or alleged untrue statement or omission, was made in reliance on and in conformity with the information provided in this Notice and Questionnaire.
Upon any sale of Registrable Securities pursuant to the Shelf Registration Statement, the Selling Securityholder will be required to deliver to the Company and Trustee the Notice of Transfer set forth in Appendix A to the Prospectus and as Exhibit B to the Exchange and Registration Rights Agreement.
The Selling Securityholder hereby provides the following information to the Company and represents and warrants that such information is accurate and complete:
A-3
QUESTIONNAIRE
| (1) | (a) | Full legal name of Selling Securityholder: | ||
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| (b) | Full legal name of registered Holder (if not the same as in (a) above) of Registrable Securities listed in Item (3) below: | |||
| (c) | Full legal name of DTC Participant (if applicable and if not the same as (b) above) through which Registrable Securities listed in Item (3) below are held: | |||
| (2) | Address for notices to Selling Securityholder: | |||
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| Telephone: | ||||||
| Fax: | ||||||
| Contact Person: | ||||||
| E-mail for Contact Person: __________________________ | ||||||
| (3) | Beneficial Ownership of Securities: | |||
| Except as set forth below in this Item (3), the undersigned does not beneficially own any | ||||
| Securities. | ||||
| (a) | Principal amount of Registrable Securities beneficially owned: _________________________________________________ | |||
| CUSIP No(s). of such Registrable Securities: ______________________________________________________________ | ||||
| (b) | Principal amount of Securities other than Registrable Securities beneficially owned: | |||
| ____________________________________________________________________________________ | ||||
| CUSIP No(s). of such other Securities: ______________________________________________________________ | ||||
| (c) | Principal amount of Registrable Securities that the undersigned wishes to be included in | |||
| the Shelf Registration Statement: ______________________________________________________________________ | ||||
| CUSIP No(s). of such Registrable Securities to be included in the Shelf Registration | ||||
| Statement: ______________________________________________________________________________________ | ||||
| (4) | Beneficial Ownership of Other Securities of the Company: | |||
| Except as set forth below in this Item (4), the undersigned Selling Securityholder is not the beneficial or registered owner of any other securities of the Company, other than the Securities listed above in Item (3). | ||||
| State any exceptions here: | ||||
| ____________________________________________________________________________________ | ||||
A-4
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A-5
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(5) Individuals who exercise dispositive powers with respect to the Securities: |
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If the Selling Securityholder is not an entity that is required to file reports with the Commission pursuant to Section 13 or 15(d) of the Exchange Act (a “Reporting Company”), then the Selling Securityholder must disclose the name of the natural person(s) who exercise sole or shared dispositive powers with respect to the Securities. Selling Securityholders should disclose the beneficial holders, not nominee holders or other such others of record. In addition, the Commission has provided guidance that Rule 13d-3 of the Securities Exchange Act of 1934 should be used by analogy when determining the person or persons sharing voting and/or dispositive powers with respect to the Securities. |
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(a) Is the holder a Reporting Company?
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Yes |
No |
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If “No”, please answer Item (5)(b). |
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(b) List below the individual or individuals who exercise dispositive powers with respect to the Securities: |
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Please note that the names of the persons listed in (b) above will be included in the Shelf Registration Statement and related Prospectus. |
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(6) Relationships with the Company: |
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Except as set forth below, neither the Selling Securityholder nor any of its affiliates, officers, directors or principal equity holders (5% or more) has held any position or office or has had any other material relationship with the Company (or its predecessors or affiliates) during the past three years. |
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State any exceptions here: |
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(7) Plan of Distribution: |
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Except as set forth below, the undersigned Selling Securityholder intends to distribute the Registrable Securities listed above in Item (3) only as follows (if at all): Such Registrable Securities may be sold from time to time directly by the undersigned Selling Securityholder. Such Registrable Securities may be sold in one or more transactions at fixed prices, at prevailing market prices at the time of sale, at varying prices determined at the time of sale, or at negotiated prices. Such sales may be effected in transactions (which may involve crosses or block transactions) (i) on any national securities exchange or quotation service on which the Registered Securities may be listed or quoted at the time of sale, (ii) in the over-the-counter market, (iii) in transactions otherwise than on such exchanges or services or in the over-the-counter market, or (iv) through the writing of options. In connection with sales of the Registrable Securities or otherwise, the Selling Se - |
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A-6
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A-7
A-8
| (b) | Set forth below is Interpretation A.65 of the Commission’s July 1997 Manual of Publicly Available Interpretations regarding short selling: |
“An issuer filed a Form S-3 registration statement for a secondary offering of common stock which is not yet effective. One of the selling shareholders wanted to do a short sale of common stock “against the box” and cover the short sale with registered shares after the effective date. The issuer was advised that the short sale could not be made before the registration statement becomes effective, because the shares underlying the short sale are deemed to be sold at the time such sale is made. There would, therefore, be a violation of Section 5 if the shares were effectively sold prior to the effective date. ”
By returning this Notice and Questionnaire, the undersigned Selling Securityholder will be deemed to be aware of the foregoing interpretation.
* * * * *
By signing below, the Selling Securityholder acknowledges that it understands its obligation to comply, and agrees that it will comply, with the provisions of the Exchange Act, particularly Regulation M (or any successor rule or regulation).
The Selling Securityholder hereby acknowledges its obligations under the Exchange and Registration Rights Agreement to indemnify and hold harmless the Company and certain other persons as set forth in the Exchange and Registration Rights Agreement.
In the event that the Selling Securityholder transfers all or any portion of the Registrable Securities listed in Item (3) above after the date on which such information is provided to the Company, the Selling Securityholder agrees to notify the transferee(s) at the time of the transfer of its rights and obligations under this Notice and Questionnaire and the Exchange and Registration Rights Agreement.
By signing below, the Selling Securityholder consents to the disclosure of the information contained herein in its answers to Items (1) through (9) above and the inclusion of such information in the Shelf Registration Statement and related Prospectus. The Selling Securityholder understands that such information will be relied upon by the Company in connection with the preparation of the Shelf Registration Statement and related Prospectus.
In accordance with the Selling Securityholder’s obligation under Section 3(d) of the Exchange and Registration Rights Agreement to provide such information as may be required by law for inclusion in the Shelf Registration Statement, the Selling Securityholder agrees to promptly notify the Company of any inaccuracies or changes in the information provided herein which may occur subsequent to the date hereof at any time while the Shelf Registration Statement remains in effect and to provide such additional information that the Company may reasonably request regarding such Selling Securityholder and the intended method of distribution of Registrable Securities in order to comply with the Securities Act. Except as otherwise provided in the Exchange and Registration Rights Agreement, all notices hereunder and pursuant to the Exchange and Registration Rights Agreement shall be made in writing, by hand-delivery, first-class mail, or air courier guaranteeing overnight delivery as follows:
A-9
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Once this Notice and Questionnaire is executed by the Selling Securityholder and received by the Company’s counsel, the terms of this Notice and Questionnaire, and the representations and warranties contained herein, shall be binding on, shall inure to the benefit of and shall be enforceable by the respective successors, heirs, personal representatives, and assigns of the Company and the Selling Securityholder (with respect to the Registrable Securities beneficially owned by such Selling Securityholder and listed in Item (3) above. This Notice and Questionnaire shall be governed in all respects by the laws of the State of New York.
A-10
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IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this Notice and Questionnaire to be executed and delivered either in person or by its duly authorized agent. |
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Dated: |
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Selling Securityholder (Print/type full legal name of beneficial owner of Registrable Securities) |
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By: |
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Name: |
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Title: |
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PLEASE RETURN THE COMPLETED AND EXECUTED NOTICE AND QUESTIONNAIRE FOR RECEIPT ON OR BEFORE [DEADLINE FOR RESPONSE] TO THE COMPANY’S COUNSEL AT: |
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A-11
Exhibit B
NOTICE OF TRANSFER PURSUANT TO REGISTRATION STATEMENT
Wilmington Trust FSB
Burlington Coat Factory Warehouse Corporation
c/o Wilmington Trust FSB
[Address of Trustee]
Attention: Trust Officer
| Re: | Burlington Coat Factory Warehouse Corporation (the “ Company ”) |
$450,000,000 Senior Notes due 2019
Dear Sirs:
Please be advised that has transferred $ aggregate principal amount of the above-referenced Notes pursuant to an effective Registration Statement on Form [ ] (File No. 333- ) filed by the Company.
We hereby certify that the prospectus delivery requirements, if any, of the Securities Act of 1933, as amended, have been satisfied and that the above-named beneficial owner of the Notes is named as a “Selling Holder” in the Prospectus dated [date] or in supplements thereto, and that the aggregate principal amount of the Notes transferred are the Notes listed in such Prospectus opposite such owner’s name.
Dated:
| Very truly yours, | ||
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| (Name) | ||
| By: |
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| (Authorized Signature) | ||
B-1
Exhibit 10.2
EXECUTION VERSION
CREDIT AGREEMENT
dated as of
February 24, 2011
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION,
as Borrower
THE FACILITY GUARANTORS NAMED HEREIN
JPMORGAN CHASE BANK, N.A.,
as Administrative Agent and Collateral Agent
GOLDMAN SACHS LENDING PARTNERS LLC,
as Syndication Agent
THE LENDERS
NAMED HEREIN
And
J.P. MORGAN SECURITIES LLC,
GOLDMAN SACHS LENDING PARTNERS LLC,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
WELLS FARGO SECURITIES, LLC,
as Joint Lead Arrangers and Joint Book Runners
TABLE OF CONTENTS
| Page | ||||||
| ARTICLE I | ||||||
| DEFINITIONS | ||||||
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SECTION 1.01 |
Definitions |
6 | ||||
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SECTION 1.02 |
Terms Generally |
38 | ||||
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SECTION 1.03 |
Accounting Terms |
39 | ||||
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SECTION 1.04 |
Rounding |
40 | ||||
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SECTION 1.05 |
Times of Day |
40 | ||||
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SECTION 1.06 |
Certifications |
40 | ||||
| ARTICLE II | ||||||
| AMOUNT AND TERMS OF CREDIT | ||||||
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SECTION 2.01 |
Commitment of the Lenders |
40 | ||||
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SECTION 2.02 |
Reserved |
40 | ||||
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SECTION 2.03 |
Procedure for Term Loan Borrowing |
40 | ||||
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SECTION 2.04 |
Repayment of Term Loans |
41 | ||||
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SECTION 2.05 |
Incremental Term Loans |
41 | ||||
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SECTION 2.06 |
Extended Term Loans |
42 | ||||
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SECTION 2.07 |
Notes |
43 | ||||
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SECTION 2.08 |
Interest on Term Loans |
44 | ||||
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SECTION 2.09 |
Conversion and Continuation of Term Loans |
44 | ||||
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SECTION 2.10 |
Alternate Rate of Interest for Term Loans |
45 | ||||
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SECTION 2.11 |
Change in Legality |
45 | ||||
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SECTION 2.12 |
Default Interest |
45 | ||||
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SECTION 2.13 |
Reserved |
46 | ||||
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SECTION 2.14 |
Increased Costs |
46 | ||||
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SECTION 2.15 |
Reserved |
46 | ||||
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SECTION 2.16 |
Optional Prepayment of Term Loans; Reimbursement of Lenders |
46 | ||||
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SECTION 2.17 |
Mandatory Prepayment |
49 | ||||
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SECTION 2.18 |
Reserved |
50 | ||||
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SECTION 2.19 |
Fees |
51 | ||||
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SECTION 2.20 |
Maintenance of Loan Account; Statements of Account |
51 | ||||
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SECTION 2.21 |
Payments |
51 | ||||
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SECTION 2.22 |
Reserved |
52 | ||||
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SECTION 2.23 |
Taxes |
52 | ||||
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SECTION 2.24 |
Mitigation Obligations; Replacement of Lenders |
55 | ||||
| ARTICLE III | ||||||
| REPRESENTATIONS AND WARRANTIES | ||||||
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SECTION 3.01 |
Organization; Powers |
56 | ||||
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SECTION 3.02 |
Authorization; Enforceability |
56 | ||||
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SECTION 3.03 |
Governmental and Other Approvals; No Conflicts |
56 | ||||
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SECTION 3.04 |
Financial Condition |
56 | ||||
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SECTION 3.05 |
Properties |
56 | ||||
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SECTION 3.06 |
Litigation and Environmental Matters |
57 | ||||
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SECTION 3.07 |
Compliance with Laws and Agreements |
58 | ||||
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SECTION 3.08 |
Investment and Holding Company Status |
58 | ||||
-i-
| Page | ||||||
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SECTION 3.09 |
Taxes |
58 | ||||
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SECTION 3.10 |
ERISA |
58 | ||||
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SECTION 3.11 |
Disclosure |
58 | ||||
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SECTION 3.12 |
Subsidiaries |
58 | ||||
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SECTION 3.13 |
Insurance |
58 | ||||
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SECTION 3.14 |
Labor Matters |
59 | ||||
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SECTION 3.15 |
Security Documents |
59 | ||||
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SECTION 3.16 |
Federal Reserve Regulations |
59 | ||||
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SECTION 3.17 |
Solvency |
59 | ||||
| ARTICLE IV | ||||||
| CONDITIONS | ||||||
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SECTION 4.01 |
Closing Date |
60 | ||||
| ARTICLE V | ||||||
| AFFIRMATIVE COVENANTS | ||||||
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SECTION 5.01 |
Financial Statements and Other Information |
61 | ||||
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SECTION 5.02 |
Notices of Material Events |
63 | ||||
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SECTION 5.03 |
Information Regarding Collateral |
64 | ||||
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SECTION 5.04 |
Existence; Conduct of Business |
64 | ||||
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SECTION 5.05 |
Payment of Obligations |
64 | ||||
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SECTION 5.06 |
Maintenance of Properties |
64 | ||||
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SECTION 5.07 |
Insurance |
64 | ||||
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SECTION 5.08 |
Books and Records; Inspection and Audit Rights; Appraisals; Accountants |
65 | ||||
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SECTION 5.09 |
Reserved |
66 | ||||
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SECTION 5.10 |
Compliance with Laws |
66 | ||||
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SECTION 5.11 |
Use of Proceeds |
66 | ||||
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SECTION 5.12 |
Additional Subsidiaries |
66 | ||||
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SECTION 5.13 |
Further Assurances |
66 | ||||
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SECTION 5.14 |
Post Closing Covenants |
66 | ||||
| ARTICLE VI | ||||||
| NEGATIVE COVENANTS | ||||||
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SECTION 6.01 |
Indebtedness and Other Obligations |
67 | ||||
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SECTION 6.02 |
Liens |
67 | ||||
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SECTION 6.03 |
Fundamental Changes |
67 | ||||
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SECTION 6.04 |
Investments, Guarantees and Acquisitions |
67 | ||||
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SECTION 6.05 |
Asset Sales |
67 | ||||
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SECTION 6.06 |
Restricted Payments; Certain Payments of Indebtedness |
67 | ||||
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SECTION 6.07 |
Transactions with Affiliates |
68 | ||||
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SECTION 6.08 |
Restrictive Agreements |
69 | ||||
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SECTION 6.09 |
Amendment of Material Documents |
69 | ||||
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SECTION 6.10 |
Financial Performance Covenants |
69 | ||||
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SECTION 6.11 |
Fiscal Year |
71 | ||||
-ii-
| Page | ||||||
| ARTICLE VII | ||||||
| EVENTS OF DEFAULT | ||||||
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SECTION 7.01 |
Events of Default |
71 | ||||
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SECTION 7.02 |
Remedies on Default |
74 | ||||
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SECTION 7.03 |
Application of Proceeds |
74 | ||||
| ARTICLE VIII | ||||||
| THE AGENTS | ||||||
|
SECTION 8.01 |
Appointment and Administration by Administrative Agent |
75 | ||||
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SECTION 8.02 |
Appointment of Collateral Agent |
75 | ||||
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SECTION 8.03 |
Sharing of Excess Payments |
75 | ||||
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SECTION 8.04 |
Agreement of Applicable Lenders |
75 | ||||
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SECTION 8.05 |
Liability of Agents |
76 | ||||
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SECTION 8.06 |
Notice of Default |
76 | ||||
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SECTION 8.07 |
Credit Decisions |
77 | ||||
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SECTION 8.08 |
Reimbursement and Indemnification |
77 | ||||
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SECTION 8.09 |
Rights of Agents |
77 | ||||
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SECTION 8.10 |
Notice of Transfer |
77 | ||||
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SECTION 8.11 |
Successor Agents |
77 | ||||
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SECTION 8.12 |
Relation Among the Lenders |
78 | ||||
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SECTION 8.13 |
Reports and Financial Statements |
78 | ||||
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SECTION 8.14 |
Agency for Perfection |
78 | ||||
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SECTION 8.15 |
Authority to Enter Into Intercreditor Agreements |
78 | ||||
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SECTION 8.16 |
Collateral Matters |
79 | ||||
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SECTION 8.17 |
Syndication Agent and Arrangers |
79 | ||||
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SECTION 8.18 |
Withholding Taxes |
79 | ||||
| ARTICLE IX | ||||||
| MISCELLANEOUS | ||||||
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SECTION 9.01 |
Notices |
79 | ||||
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SECTION 9.02 |
Waivers; Amendments |
80 | ||||
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SECTION 9.03 |
Expenses; Indemnity; Damage Waiver |
82 | ||||
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SECTION 9.04 |
Successors and Assigns |
83 | ||||
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SECTION 9.05 |
Survival |
88 | ||||
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SECTION 9.06 |
Counterparts; Integration; Effectiveness |
88 | ||||
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SECTION 9.07 |
Severability |
88 | ||||
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SECTION 9.08 |
Right of Setoff |
88 | ||||
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SECTION 9.09 |
Governing Law; Jurisdiction; Consent to Service of Process |
89 | ||||
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SECTION 9.10 |
WAIVER OF JURY TRIAL |
89 | ||||
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SECTION 9.11 |
Press Releases and Related Matters |
89 | ||||
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SECTION 9.12 |
Headings |
89 | ||||
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SECTION 9.13 |
Interest Rate Limitation |
89 | ||||
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SECTION 9.14 |
Additional Waivers |
90 | ||||
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SECTION 9.15 |
Confidentiality |
91 | ||||
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SECTION 9.16 |
Patriot Act |
91 | ||||
|
SECTION 9.17 |
Foreign Asset Control Regulations |
92 | ||||
|
SECTION 9.18 |
Intercreditor Agreements |
92 | ||||
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SECTION 9.19 |
No Advisory or Fiduciary Responsibility |
92 | ||||
-iii-
EXHIBITS
| Exhibit A: | Form of Assignment and Acceptance | |
| Exhibit B-1: | Borrowing Request | |
| Exhibit B-2: | Conversion/Continuation Notice | |
| Exhibit C: | Form of Note | |
| Exhibit D: | Form of Joinder | |
| Exhibit E: | Form of Compliance Certificate | |
| Exhibit F: | Closing Agenda | |
| Exhibit G: | Pari Passu Lien Intercreditor Agreement | |
| Exhibit H: | Discounted Prepayment Option Notice | |
| Exhibit I: | Lender Participation Notice | |
| Exhibit J: | Discounted Voluntary Prepayment Notice | |
| Exhibit K: | Affiliated Lender Assignment and Acceptance | |
| Exhibit L-1 | Form of Tax Status Certificate | |
| Exhibit L-2 | Form of Tax Status Certificate | |
| Exhibit L-3 | Form of Tax Status Certificate | |
| Exhibit L-4 | Form of Tax Status Certificate |
SCHEDULES
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Schedule 1.1(a): |
Lenders and Commitments | |
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Schedule 1.1(b): |
Pending Real Estate Dispositions | |
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Schedule 3.01: |
Organization Information | |
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Schedule 3.05(a): |
Title Exceptions | |
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Schedule 3.05(b): |
Intellectual Property | |
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Schedule 3.05(c)(i): |
Owned Real Estate | |
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Schedule 3.05(c)(ii): |
Leased Real Estate | |
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Schedule 3.06(a): |
Disclosed Matters | |
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Schedule 3.06(b): |
Environmental Matters | |
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Schedule 3.06(c): |
Superfund Sites | |
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Schedule 3.06(d): |
Real Estate Liens | |
|
Schedule 3.10: |
ERISA Matters | |
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Schedule 3.12: |
Subsidiaries; Joint Ventures | |
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Schedule 3.13: |
Insurance | |
|
Schedule 3.14: |
Collective Bargaining Agreements | |
|
Schedule 5.14: |
Post Closing Covenants | |
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Schedule 6.01: |
Existing Indebtedness | |
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Schedule 6.02: |
Existing Encumbrances | |
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Schedule 6.04: |
Existing Investments | |
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Schedule 6.05: |
Asset Sales | |
|
Schedule 6.07: |
Affiliate Transactions |
-iv-
CREDIT AGREEMENT dated as of February 24, 2011 among:
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION (in such capacity, the “ Borrower ”), a corporation organized under the laws of the State of Delaware, with its principal executive offices at 1830 Route 130, Burlington, New Jersey 08016;
The FACILITY GUARANTORS from time to time party hereto;
JPMORGAN CHASE BANK, N.A. , as administrative agent (in such capacity, the “ Administrative Agent ”), and as collateral agent (in such capacity, the “ Collateral Agent ”), for its own benefit and the benefit of the other Secured Parties; and
The LENDERS party hereto;
in consideration of the mutual covenants herein contained and benefits to be derived herefrom, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01 Definitions . As used in this Agreement, the following terms have the meanings specified below:
“ ABL Agreement ” means that certain amended and restated credit agreement dated January 15, 2010 by and among the Borrower, as the lead borrower, the other borrowers named therein, Bank of America, N.A., as administrative agent and as collateral agent as replaced by any successor agent, and the lenders identified therein, as amended, restated, supplemented or otherwise modified from time to time.
“ ABL Borrowings Amount ” means, as of any date (the “ Reference Date ”), an amount equal to (a) the sum of the aggregate amount of Revolving Credit Loans of the Borrower and its Subsidiaries outstanding as of the Reference Date and the last day of each of the eleven months ending immediately prior to the Reference Date divided by (b) twelve.
“ ABL Facility ” means the revolving credit loan facility established pursuant to the ABL Agreement, as amended, restated, amended and restated, modified, supplemented, refinanced or replaced from time to time.
“ ABL Intercreditor Agreement ” means that certain Intercreditor Agreement dated as of April 13, 2006 by and among Bear Stearns Corporate Lending Inc., as predecessor administrative agent and collateral agent to the Term Agent (as defined in the ABL Intercreditor Agreement) thereunder, Bank of America, N.A., as administrative agent and as collateral agent under the ABL Facility, and the Loan Parties, as amended, restated, supplemented or otherwise modified from time to time.
“ Acceptable Discount ” has the meaning provided in SECTION 2.16(d)(iii).
“ Acceptance Date ” has the meaning provided in SECTION 2.16(d)(ii).
“ Account(s) ” means “accounts” as defined in the UCC, and also means a right to payment of a monetary obligation, whether or not earned by performance, (a) for property that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, (b) for services rendered or to be rendered, or (c) arising out of the use of a credit or charge card or information contained on or for use with the card. The term “Account” does not include (a) rights to payment evidenced by chattel paper or an instrument, (b) commercial tort claims, (c) deposit accounts, (d) investment property, or (e) letter-of-credit rights or letters of credit.
“ Acquired EBITDA ” means, with respect to any entity or business acquired in a Permitted Acquisition (any of the foregoing, an “ Acquired Entity ”), for any period, the amount of Consolidated EBITDA of such Acquired Entity for such period (determined using such definition as if references to the Borrower and its Subsidiaries therein were to such Acquired Entity and its Subsidiaries), all as determined on a Consolidated basis for such Acquired Entity in accordance with GAAP.
“ Acquired Entity ” has the meaning provided in the definition of “Acquired EBITDA.”
“ Acquisition ” means, with respect to a specified Person, (a) an Investment in or a purchase of a 50% or greater interest in the Capital Stock of any other Person, (b) a purchase or acquisition of all or substantially all of the assets of any other Person, (c) a purchase or acquisition of a Real Estate portfolio or Stores from any other Person, or (d) any merger or consolidation of such Person with any other Person or other transaction or series of transactions resulting in the acquisition of all or substantially all of the assets, or a 50% or greater interest in the Capital Stock of, any Person, in each case in any transaction or group of transactions which are part of a common plan.
“ Adjusted LIBO Rate ” means, with respect to any LIBO Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next 1/100 of one percent) equal to the greater of (i) the product of (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate and (ii) 1.50%. At any time the Adjusted LIBO Rate is determined pursuant to clause (i) of the preceding sentence, the Adjusted LIBO Rate will be adjusted automatically as to all LIBO Borrowings then outstanding as of the effective date of any change in the Statutory Reserve Rate.
“ Administrative Agent ” has the meaning provided in the preamble to this Agreement.
“ Administrative Questionnaire ” means an administrative questionnaire in a form supplied by the Administrative Agent.
“ Advisory Agreement ” means the Advisory Agreement dated as of April 13, 2006 by and among BCF Holdings, the Borrower and Bain Capital Partners, LLC, a Delaware limited liability company, as amended and in effect from time to time in a manner not prohibited hereunder.
“ Advisory Fees ” means annual advisory fees, closing fees and transaction fees and related expenses payable by the Loan Parties pursuant to the Advisory Agreement, but not to exceed the amounts payable thereunder as in effect on the Closing Date.
“ Affiliate ” means, with respect to a specified Person, any other Person that directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with the Person specified.
“ Agents ” means collectively, the Administrative Agent and the Collateral Agent.
“ Agreement ” means this Credit Agreement, as modified, amended, supplemented or restated, and in effect from time to time.
“ Agreement Value ” means for each Hedge Agreement, on any date of determination, an amount equal to:
(a) In the case of a Hedge Agreement documented pursuant to an ISDA Master Agreement, the amount, if any, that would be payable by any Loan Party to its counterparty to such Hedge Agreement, as if (i) such Hedge Agreement was being terminated early on such date of determination and (ii) such Loan Party was the sole “Affected Party” (as therein defined);
(b) In the case of a Hedge Agreement traded on an exchange, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss, if any, on such Hedge Agreement to the Loan Party which is party to such Hedge Agreement, based on the settlement price of such Hedge Agreement on such date of determination; or
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(c) In all other cases, the mark-to-market value of such Hedge Agreement, which will be the unrealized loss, if any, on such Hedge Agreement to the Loan Party that is party to such Hedge Agreement as the amount, if any, by which (i) the present value of the future cash flows to be paid by such Loan Party exceeds (ii) the present value of the future cash flows to be received by such Loan Party, in each case pursuant to such Hedge Agreement.
“ Applicable Discount ” has the meaning provided in SECTION 2.16(d)(iii).
“ Applicable Law ” means as to any Person: (a) all laws, statutes, rules, regulations, orders, codes, ordinances or other requirements having the force of law; and (b) all court orders, decrees, judgments, injunctions, enforceable notices, binding agreements and/or rulings, in each case of or by any Governmental Authority which has jurisdiction over such Person, or any property of such Person.
“ Applicable Lenders ” means the Required Lenders or all Lenders, as applicable.
“ Applicable Margin ” means 4.75%, in the case of Term B Loans which are LIBO Loans, and 3.75%, in the case of Term B Loans which are Prime Rate Loans. The Incremental Term Loans and Extended Term Loans shall have Applicable Margins as set forth in the applicable Incremental Term Loan Amendment or Term Loan Extension Amendment; provided , that, in the event that the Yield applicable to any Incremental Term Loans (other than Refinancing Term Loans) of any Class would be more than 0.50% greater than the Yield for the Term B Loans, the Applicable Margins set forth above for the Term B Loans shall be increased from those provided above so that the Yield for the Term B Loans is equal to (x) the Yield for such Incremental Term Loans minus (y) 0.50%.
“ Approved Fund ” means any Fund 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.
“ Arrangers ” means, collectively, J.P. Morgan Securities LLC, Goldman Sachs Lending Partners LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Securities, LLC in their capacities as joint lead arrangers and bookrunners.
“ Assignment and Acceptance ” means an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by SECTION 9.04), and accepted by the Administrative Agent, in substantially the form of Exhibit A or any other form approved by the Administrative Agent.
“ Available Amount ” means, on any date (the “ Specified Date ”), an amount equal at such time to (a) the sum of (i) the excess, if positive, of (x) an amount, not less than zero, equal to the cumulative amount of Excess Cash Flow for all full Fiscal Years commencing after the Closing Date (commencing with the Fiscal Year ending January 28, 2012) and prior to the Specified Date minus (y) the portion of such Excess Cash Flow that has been after the Closing Date and on or prior to the Specified Date applied to the prepayment of Loans in accordance with SECTION 2.17(d) plus (ii) the aggregate net cash proceeds (excluding proceeds constituting the Cure Amount and excluding any proceeds that were relied upon as the basis for taking any other action under ARTICLE VI the permissibility of which was conditioned on the application of such proceeds for such purpose) received by the Borrower following the Closing Date from the issuance and sale of its Capital Stock (other than Disqualified Capital Stock) or contributions to the capital of the Borrower; minus (b) the sum of (i) the aggregate amount of Capital Expenditures made by any Loan Party pursuant to SECTION 6.10(c)(ii) after the Closing Date and on or prior to the Specified Date plus (ii) the aggregate amount of Investments made in reliance on clause (t) of the definition of “Permitted Investments” prior to such Specified Date (net of any cash return on such Investments received by any Loan Party from such Investments prior to such Specified Date) plus (iii) the aggregate amount of payments in respect of Specified Indebtedness made pursuant to SECTION 6.06(b)(v) prior to such Specified Date.
“ Bankruptcy Code ” means Title 11, U.S.C., as now or hereafter in effect, or any successor thereto.
“ BCF Holdings ” means Burlington Coat Factory Holdings, Inc.
“ Board ” means the Board of Governors of the Federal Reserve System of the United States of America.
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“ Borrower ” has the meaning set forth in the Preamble to this Agreement.
“ Borrowing ” means the incurrence of Term Loans of a single Class and Type having, in the case of LIBO Loans, a single Interest Period.
“ Borrowing Base ” means, as of any date, an amount equal to the sum of (x) 95% of the face value of all accounts receivable of the Loan Parties and their Subsidiaries and (y) 65% of the net book value of all inventory owned by the Loan Parties and their Subsidiaries, in each case, calculated on a consolidated basis; provided, however , that if Indebtedness is being incurred to finance an Acquisition pursuant to which any accounts receivable or inventory will be acquired (whether through the direct acquisition of assets or the acquisition of Capital Stock of a Person), the Borrowing Base shall be calculated to give appropriate pro forma effect to any increase in the amount of the Loan Parties’ and their Subsidiaries’ accounts receivable and inventory resulting from such Acquisition.
“ Borrowing Request ” means a request by the Borrower for a Borrowing in accordance with SECTION 2.03.
“ Breakage Costs ” has the meaning provided in SECTION 2.16(b).
“ Business Day ” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or required by law to remain closed; provided , however , that when used in connection with a LIBO Loan, 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.
“ Capital Expenditures ” means, with respect to the Loan Parties for any period, the additions to property, plant and equipment and other capital expenditures of the Loan Parties that are (or would be) set forth in a Consolidated statement of cash flows of the Loan Parties for such period prepared in accordance with GAAP; provided that “Capital Expenditures” shall not include (i) any additions to property, plant and equipment and other capital expenditures made with (A) the proceeds of any equity securities issued or capital contributions received by any Loan Party or any Subsidiary in connection with such capital expenditures, (B) the proceeds from any casualty insurance or condemnation or eminent domain, to the extent that the proceeds therefrom are utilized for capital expenditures within twelve months of the receipt of such proceeds or (C) the proceeds or consideration received from any sale, trade in or other disposition of assets (other than assets constituting Collateral consisting of Inventory and Accounts), to the extent that the proceeds and/or consideration therefrom are utilized for capital expenditures within twelve months of the receipt of such proceeds (or, in the case of a sale of Real Estate committed to be reinvested within 12 months of receipt of such proceeds and actually reinvested within 18 months of such receipt), (ii) any such expenditures which constitute a Permitted Acquisition, or (iii) any expenditures which are contractually required to be, and are, reimbursed to the Loan Parties in cash by a third party (including landlords) during such period of calculation.
“ Capital Lease Obligations ” means, with respect to any Person for any period, 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; for purposes of this Agreement, the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP (except for temporary treatment of construction related expenditures under EITF 97-10, “The Effects of Lessee Involvement in Asset Construction” which will ultimately be treated as operating leases upon a sale-leaseback transaction).
“ Capital Stock ” means, as to any Person that is a corporation, the authorized shares of such Person’s capital stock, including all classes of common, preferred, voting and nonvoting capital stock, and, as to any Person that is not a corporation or an individual, the membership or other ownership interests in such Person, including, without limitation, the right to share in profits and losses, the right to receive distributions of cash and other property, and the right to receive allocations of items of income, gain, loss, deduction and credit and similar items from such Person, whether or not such interests include voting or similar rights entitling the holder thereof to exercise Control over such Person, collectively with, in any such case, all warrants, options and other rights to purchase or otherwise acquire, and all other instruments convertible into or exchangeable for, any of the foregoing.
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“ Cash Equivalents ” means Permitted Investments set forth in clauses (a) through (e) in the definition thereof.
“ CERCLA ” means the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601 et seq.
“ Change in Control ” means, at any time:
(a) any “change in/of control” or similar event as defined in any documents governing the Senior Notes;
(b) after the consummation of a Qualifying IPO, any person or “group” (within the meaning of the Securities and Exchange Act of 1934, as amended), other than any one or more of the Sponsor Group, is or becomes the beneficial owner (within the meaning of Rule 13d-3 or 13d-5 of the Securities and Exchange Act of 1934, as amended, except that such person shall be deemed to have “beneficial ownership” of all Capital Stock that such person has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of (i) thirty-five percent (35%) or more (on a fully diluted basis) of the total then outstanding Capital Stock of BCF Holdings (or Parent if the Qualifying IPO is undertaken by Parent) entitled to vote for the election of directors of BCF Holdings (or Parent, if applicable), and (ii) Capital Stock of BCF Holdings (or Parent, if applicable) entitled to vote for the election of directors of the BCF Holdings (or Parent, if applicable) in an amount greater than the number of shares of such Capital Stock beneficially owned by the Sponsor Group (or over which the Sponsor Group has voting control); or
(c) Parent fails at any time to own, directly or indirectly, 100% of the Capital Stock of the Borrower, except where such failure is as a result of a transaction permitted by the Loan Documents.
“ Change in Law ” means (a) the adoption of any Applicable Law after the Closing Date, (b) any change in any Applicable Law or in the interpretation or application thereof by any Governmental Authority after the Closing Date or (c) compliance by any Credit Party (or, for purposes of SECTION 2.14, by any lending office of such Credit Party or by such Credit Party’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, the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith shall be deemed to be a “Change in Law,” regardless of the date enacted, adopted or issued.
“ Charges ” has the meaning provided in SECTION 9.13.
“ Charter Document ” means as to any Person, its partnership agreement, certificate of incorporation, certificate of formation, operating agreement, membership agreement or similar constitutive document or agreement or its by-laws.
“ Class ” refers to (a) the Term B Loans, (b) any particular Series of Incremental Term Loans and (c) any particular Extension Series of Extended Term Loans, each as an individual Class of Term Loans hereunder.
“ Closing Date ” means February 24, 2011.
“ Code ” means the Internal Revenue Code of 1986 and the Treasury regulations promulgated thereunder, as amended from time to time.
“ Collateral ” means any and all “Collateral,” “Pledged Collateral” or words of similar intent as defined in any applicable Security Document.
“ Collateral Agent ” has the meaning provided in the preamble to this Agreement.
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“ Commitment ” means, as to any Lender, the obligation of such Lender to make a Term B Loan to the Borrower in a principal amount not to exceed the amount set forth opposite its name on Schedule 1.1(a) .
“ Compliance Certificate ” has the meaning provided in SECTION 5.01(d).
“ Consolidated ” means, when used to modify a financial term, test, statement, or report of a Person, the application or preparation of such term, test, statement or report (as applicable) based upon the consolidation, in accordance with GAAP, of the financial condition or operating results of such Person and its Subsidiaries.
“ Consolidated Current Assets ” means, at any date, all amounts (other than cash, Cash Equivalents and the current portion of deferred income taxes) that would, in conformity with GAAP, be included in the caption “total current assets” (or any like caption) on a consolidated balance sheet of the Borrower and its Subsidiaries at such date.
“ Consolidated Current Liabilities ” means, at any date, all amounts that would, in conformity with GAAP, be included in the caption “total current liabilities” (or any like caption) on a consolidated balance sheet of the Borrower and its Subsidiaries at such date, but excluding (a) the current portion of any Funded Debt of the Borrower and its Subsidiaries and (b) without duplication of clause (a) above, all Indebtedness consisting of Revolving Loans (as defined in the ABL Agreement) and Swingline Loans (as defined in the ABL Agreement) to the extent otherwise included therein, (c) the current portion of deferred income taxes and (d) any liability in respect of net obligations pursuant to Hedge Agreements related solely to interest rate protection.
“ Consolidated EBITDA ” means, with respect to any Person for any period, (i) the sum (without duplication) of (a) Consolidated Net Income for such period, plus in each case without duplication and to the extent deducted in determining Consolidated Net Income for such period, (b) depreciation, amortization, and all other non-cash charges, non-cash expenses or non-cash losses, (c) provisions for Consolidated Taxes based on income, (d) Consolidated Interest Expense, (e) Advisory Fees whether accrued or paid in cash, (f) all transactional costs, expenses and charges in connection with, the consummation of the Transactions and any transaction related to any Permitted Acquisition, Permitted Disposition, issuance of Permitted Indebtedness or issuance of Capital Stock, (g) to the extent not already included in Consolidated Net Income, proceeds from business interruption insurance, (h) to the extent not already included in Consolidated Net Income and actually indemnified or reimbursed, any expenses and charges that are covered by indemnification or reimbursement provisions in connection with any Permitted Acquisition or any Permitted Disposition, (i) cash receipts (or reduced cash expenditures) in respect of income received in connection with subleases to the extent non-cash gains relating to such income were deducted in the calculation of Consolidated EBITDA pursuant to clause (ii)(b) below for any previous period, (j) cash charges not to exceed $25,000,000 in the aggregate after the Closing Date associated with restructuring activities, including, but not limited to, restructuring, consolidation or discontinuance of any portion of the operations, severance, recruiting, retention, relocation and other expenses of management and contract and lease termination expenses, and (k) unusual, nonrecurring or extraordinary expenses, losses or charges, minus (ii) the sum of (a) any Restricted Payments made in cash during such period to any Person (other than a Loan Party) having an interest in any Subsidiary of a Loan Party (b) non-cash gains for such period to the extent included in Consolidated Net Income, and (c) cash payments made during such period on account of non-cash charges added back in the calculation of Consolidated EBITDA pursuant to clause (i)(b) above for any previous period; provided that Consolidated EBITDA shall be increased or decreased for any period to the extent necessary to eliminate the effects during such period of any increase or decrease in legal, auditing, consulting and accounting related expenses (including changes to accounting systems) for such period relating directly to the change in Fiscal Year of the Loan Parties to the period of twelve consecutive Fiscal Months ending the Saturday closest to January 31 of any calendar year compared to the amount of such expenses that would have been incurred in such period had such change in Fiscal Year not occurred (as determined in good faith by the Borrower and as set forth in a certificate of a Responsible Officer delivered to the Administrative Agent); provided further that Consolidated EBITDA of the Borrower and its Subsidiaries for the Fiscal Quarters ending May 1, 2010, July 31, 2010 and October 30, 2010 shall be $78,232,000, $7,816,000 and $63,226,000, respectively.
“ Consolidated Interest Coverage Ratio ” means, on the last day of any Fiscal Quarter, the ratio of (a) Consolidated EBITDA of the Borrower and its Subsidiaries for the period of four consecutive Fiscal Quarters most recently ended on and prior to such date, taken as one accounting period, to (b) Consolidated Interest Expense
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of the Borrower paid in cash for the period of four consecutive Fiscal Quarters most recently ended on and prior to such date, taken as one accounting period.
“ Consolidated Interest Expense ” means, with respect to any Person for any period, total interest expense (including that attributable to Capital Lease Obligations in accordance with GAAP but excluding any imputed interest as a result of purchase accounting) of such Person on a Consolidated basis with respect to all outstanding Indebtedness of such Person, including, without limitation, the Obligations and all commissions, discounts and other fees and charges owed with respect thereto, but excluding (i) any non-cash or deferred interest financing costs and (ii) any non-cash amortization or write-down of any deferred financing fees or bridge facility fees, all as determined on a Consolidated basis in accordance with GAAP and reduced by interest income received or receivable in cash for such period. For purposes of the foregoing, interest expense of any Person shall be determined after giving effect to any net payments made or received by such Person with respect to interest rate Hedge Agreements.
“ Consolidated Leverage Ratio ” means, as of any date, the ratio of (a) the sum of (i) Consolidated Total Debt (other than any portion of such Consolidated Total Debt that is attributed to Revolving Credit Loans of the Borrower and its Subsidiaries outstanding at such date) plus (ii) the ABL Borrowings Amount on such date to (b) Consolidated EBITDA of the Borrower and its Subsidiaries for the period of four consecutive Fiscal Quarters most recently ended on or prior to such date, taken as one accounting period.
“ Consolidated Net Income ” means, with respect to any Person for any period, the net income (or loss) of such Person on a Consolidated basis for such period taken as a single accounting period determined in accordance with GAAP; provided , however , that there shall be excluded (a) the income (or loss) of such Person in which any other Person has a joint interest, except to the extent of the amount of dividends or other distributions actually paid in cash to such Person during such period, and (b) the income of any direct or indirect Subsidiary of a Person to the extent that the declaration or payment of dividends or similar distributions by that Subsidiary of that income is not at the time permitted by operation of the terms of its Charter Documents or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary.
“ Consolidated Secured Leverage Ratio ” means, as of any date, the ratio of (a) the sum of (i) Consolidated Total Debt (other than any portion of such Consolidated Total Debt that is (x) attributed to Revolving Credit Loans of the Borrower and its Subsidiaries outstanding at such date or (y) not secured by any Liens on any assets of the Borrower or any of its Subsidiaries) plus (ii) the ABL Borrowings Amount on such date to (b) Consolidated EBITDA of the Borrower and its Subsidiaries for the period of four consecutive Fiscal Quarters most recently ended on or prior to such date, taken as one accounting period.
“ Consolidated Taxes ” means, as of any date for the applicable period ending on such date with respect to the Loan Parties on a Consolidated basis, the aggregate of all income, withholding, franchise and similar taxes and foreign withholding taxes, as determined in accordance with GAAP, to the extent the same are paid or accrued during such period.
“ Consolidated Total Debt ” means, at any date, the aggregate principal amount of all Indebtedness of the Borrower and its Subsidiaries on a Consolidated basis outstanding at such date in the amount that would be reflected on a balance sheet prepared on such date in accordance with GAAP.
“ Consolidated Working Capital ” means, at any date, the excess of Consolidated Current Assets on such date over Consolidated Current Liabilities on such date.
“ Control ” means the possession, directly or indirectly, of the power (a) to vote 50% or more of the securities having ordinary voting power for the election of directors (or any similar governing body) of a Person, or (b) 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. The terms “ Controlling ” and “ Controlled ” have meanings correlative thereto.
“ Credit Party ” means (a) the Lenders, (b) the Agents and their respective Affiliates and branches, (c) the Arrangers and (d) the successors and permitted assigns of each of the foregoing.
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“ Credit Party Expenses ” means, without limitation, all of the following to the extent incurred in connection with this Agreement and the other Loan Documents: (a) all reasonable and documented out-of-pocket expenses incurred by the Agents and their Affiliates, including the reasonable and documented fees, charges and disbursements of one counsel for the Agents and their Affiliates (plus one local counsel in each other jurisdiction to the extent reasonably necessary), in connection with the preparation and administration of the Loan Documents, the syndication of the credit facilities provided for herein, or any amendments, modifications or waivers requested by a Loan Party of the provisions hereof or thereof (whether or not any such amendments, modifications or waivers shall be consummated) and (b) all reasonable and documented out-of-pocket expenses incurred by the Arrangers, Agents or, subject to the proviso below any Lender and their respective Affiliates and branches, including the reasonable and documented fees, charges and disbursements of one counsel for the Arrangers, the Agents and their Affiliates (plus one local counsel in each other jurisdiction to the extent reasonably necessary) in connection with the enforcement and protection of their rights in connection with the Loan Documents, including all such reasonable and documented out-of-pocket expenses incurred during any workout, restructuring or related negotiations in respect of such Term Loans; provided that the Lenders who are not the Arrangers or Agents shall be entitled to reimbursement for no more than one counsel representing all such Lenders who shall be selected by the Agent (absent a conflict of interest in which case each group of similarly situated Lenders, taken as a whole, may engage and be reimbursed for one additional counsel to the affected party). Credit Party Expenses shall not include the allocation of any overhead expenses of any Credit Party.
“ Cure Amount ” has the meaning provided in SECTION 7.01.
“ Cure Right ” has the meaning provided in SECTION 7.01.
“ Default ” means any event or condition described in SECTION 7.01 that constitutes an Event of Default or that upon notice, lapse of any cure period set forth in SECTION 7.01, or both, would, unless cured or waived, become an Event of Default.
“ Default Rate ” has the meaning provided in SECTION 2.12.
“ Disclosed Matters ” means the actions, suits and proceedings and the environmental matters disclosed on Schedule 3.06(a) and Schedule 3.06(b) .
“ Discount Range ” has the meaning provided in SECTION 2.16(d)(ii).
“ Discounted Prepayment Option Notice ” has the meaning provided SECTION 2.16(d)(ii).
“ Discounted Voluntary Prepayment ” has the meaning provided in SECTION 2.16(d)(i).
“ Discounted Voluntary Prepayment Notice ” has the meaning provided in SECTION 2.16(d)(v).
“ Disqualified Capital Stock ” means any Capital Stock which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, (a) is mandatorily redeemable in whole or in part prior to the Maturity Date of any Class of Term Loans outstanding on the date such Capital Stock is issued, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, (b) is convertible into or exchangeable (unless at the sole option of the issuer thereof) for (i) Indebtedness or any Capital Stock referred to in (a) above prior to the Maturity Date of any Class of Term Loans outstanding on the date such Capital Stock is issued, or (c) contains any mandatory repurchase obligation which comes into effect prior to the Maturity Date of any Class of Term Loans outstanding on the date such Capital Stock is issued, provided that any Capital Stock that would not constitute Disqualified Capital Stock but for provisions thereof giving holders thereof (or the holders of any security into or for which such Capital Stock is convertible, exchangeable or exercisable) the right to require the issuer thereof to redeem such Capital Stock upon the occurrence of a Change in Control shall not constitute Disqualified Capital Stock.
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“ Dividend Payment ” means a one-time dividend in an amount not to exceed $325,000,000, a portion of which shall be used to repurchase or redeem all 14 1/2% Senior Discount Notes due 2014 previously issued by Parent.
“ Documents ” has the meaning assigned to such term in the Security Agreement.
“ dollars ” or “ $ ” refers to lawful money of the United States of America.
“ Earn-Out Obligations ” means the maximum amount of all obligations incurred or to be incurred in connection with any Acquisition of a Person pursuant to a Permitted Acquisition under non-compete agreements, consulting agreements, earn-out agreements and similar deferred purchase agreements.
“ ECF Percentage ” means, with respect to any Fiscal Year of the Borrower ending on or after January 28, 2012, 50%; provided that the ECF Percentage shall be reduced to (i) 25%, if the Consolidated Leverage Ratio as of the last day of such Fiscal Year is less than or equal to 4.0 to 1.0 and greater than or equal to 3.5 to 1.0, or (ii) 0%, if the Consolidated Leverage Ratio as of the last day of such Fiscal Year is less than 3.5 to 1.0.
“ Eligible Assignee ” means any Lender, Affiliate of a Lender or Fund (including, without limitation, any Investment Fund or Approved Fund); provided that in any event, “Eligible Assignee” shall not include any natural person or any Person in direct competition with a Loan Party’s business and identified in writing to the Administrative Agent by the Borrower from time to time (and the Administrative Agent shall notify the Lenders of any Persons so identified by the Borrower).
“ Environmental Laws ” means all Applicable Laws issued, promulgated or entered into by or with any Governmental Authority, relating in any way to (a) the protection of the environment, (b) the handling, treatment, storage, disposal of Hazardous Materials, (c) exposure of any Person to Hazardous Materials, or the Release or threatened Release of any Hazardous Material to the environment, (d) the assessment or remediation of any such Release or threatened Release of any Hazardous Material to the environment or (e) occupational health or safety matters.
“ Environmental Liability ” means any liability, contingent or otherwise (including, without limitation, any liability for damages, natural resource damage, costs of environmental remediation, administrative oversight costs, fines, penalties or indemnities), of any Loan Party 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.
“ Equipment ” has the meaning set forth in the Security Documents.
“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time and the regulations promulgated and rulings issued thereunder.
“ 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 of ERISA with respect to a Plan (other than an event for which the 30 day notice period is waived); (b) with respect to any Plan, the failure to satisfy the minimum funding standard under Section 412 of the Code or Section 302 of ERISA, 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 incurrence by the Borrower or any ERISA Affiliate of any liability under Title IV of ERISA with respect to the termination of any Plan; (e) 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 Plans or to appoint a trustee to administer any Plan; (f) the incurrence by the Borrower or any ERISA Affiliate of any liability in excess of $25,000,000 (or such lesser amount as would reasonably be expected to
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result in a Material Adverse Effect) with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; or (g) 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 in excess of $25,000,000 (or such lesser amount as would reasonably be expected to result in a Material Adverse Effect) or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA. “ Event of Default ” has the meaning provided in SECTION 7.01.
“ Excess Cash Flow ” means, for any Fiscal Year of the Borrower, the excess, if any, of (a) the sum, without duplication, of (i) Consolidated Net Income for such Fiscal Year, (ii) the amount of all non-cash charges (including Consolidated depreciation and amortization) deducted in arriving at such Consolidated Net Income to the extent such non-cash charges do not result in a cash payment in a future period, (iii) decreases in Consolidated Working Capital for such Fiscal Year, and (iv) the aggregate net amount of non-cash loss on the sale, transfer or other disposition of any assets by the Borrower and its Subsidiaries during such Fiscal Year outside the ordinary course of business, to the extent deducted in arriving at such Consolidated Net Income over (b) the sum, without duplication, of (i) the amount of all non-cash credits included in arriving at such Consolidated Net Income, (ii) the aggregate amount actually paid by the Borrower and its Subsidiaries in cash during such Fiscal Year on account of unfinanced Capital Expenditures, (iii) the aggregate amount of all regularly scheduled principal payments of the Term Loans during such Fiscal Year, (iv) the aggregate amount of all regularly scheduled, mandatory or optional principal payments of Funded Debt (other than the Term Loans) of the Borrower and its Subsidiaries made during such Fiscal Year (other than (x) in respect of any revolving credit facility to the extent there is not an equivalent permanent reduction in commitments thereunder and (y) any such principal prepayments financed with the proceeds of other Indebtedness), (v) increases in Consolidated Working Capital for such Fiscal Year, (vi) the aggregate net amount of non-cash gain on the sale, transfer or other disposition of any assets by the Borrower and its Subsidiaries during such Fiscal Year outside the ordinary course of business, to the extent included in arriving at such Consolidated Net Income and (vii) cash payments made in respect of long-term liabilities of the Borrower and its Subsidiaries other than Indebtedness.
“ Excess Cash Flow Application Date ” has the meaning provided in SECTION 2.17(d).
“ Excluded Taxes ” means, with respect to the Agents, any Lender or any other recipient of any payment to be made by or on account of any obligation of the Borrower hereunder, (a) income or franchise taxes imposed on (or measured by) its gross or net income by the United States of America, or by the jurisdiction under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits taxes imposed by the United States of America or any similar tax imposed by any other jurisdiction in which the Borrower is located, (c) taxes imposed on any “withholdable payment” payable to such recipient as a result of the failure of such recipient to satisfy the applicable requirements as set forth in FATCA or any amended or successor version that is substantively comparable, and (d) in the case of a Foreign Lender (other than an assignee pursuant to a request by the Borrower under SECTION 2.24(a)), any United States withholding tax that is imposed on amounts payable to such Foreign Lender (i) under any law in effect at the time such Foreign Lender becomes a party to this Agreement (or designates a new lending office other than at the request of the Borrower under SECTION 2.24), except to the extent that such Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending office (or assignment), to receive additional amounts from the Borrower with respect to such withholding tax pursuant to SECTION 2.23(a) or (ii) is attributable to such Foreign Lender’s failure to comply with SECTION 2.23(e).
“ Existing Term Loan Class ” has the meaning provided in SECTION 2.06(a).
“ Extended Term Loans ” has the meaning provided in SECTION 2.06(a).
“ Extending Term Lender ” has the meaning provided in SECTION 2.06(c).
“ Extension Election ” has the meaning provided in SECTION 2.06(c).
“ Extension Request ” has the meaning provided in SECTION 2.06(a).
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“ Extension Series ” has the meaning provided in SECTION 2.06(b).
“ Facility Guarantee ” means any Guarantee of the Obligations executed by BCF Holdings and its Subsidiaries which are or hereafter become Facility Guarantors in favor of the Agents and the other Secured Parties.
“ Facility Guarantors ” means any Person executing a Facility Guarantee.
“ FATCA ” means Sections 1471 through 1474 of the Code and any Treasury regulations with respect thereto or official interpretations thereof.
“ Federal Funds Effective Rate ” means, for any day, the weighted average (rounded upwards, if necessary, to the next 1/100 of one percent (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 one percent (1%)) of the quotations for such day for such transactions received by the Administrative Agent from three (3) federal funds brokers of recognized standing selected by it.
“ Fee Letter ” means the Fee Letter dated February 24, 2011 by and between the Borrower and the Administrative Agent.
“ Financial Officer ” means, with respect to any Loan Party, the chief financial officer, chief accounting officer, treasurer, assistant treasurer, controller or assistant controller of such Loan Party.
“ Financial Performance Covenants ” means the covenants of the Borrower set forth in SECTIONS 6.10 (a) and (b).
“ Fiscal Month ” means any fiscal month of any Fiscal Year, which month shall generally consist of (i) in the case of the first, third, fourth, sixth, seventh, ninth and tenth Fiscal Months of each Fiscal Year, four calendar weeks, (ii) in the case of the second, fifth, eighth and eleventh Fiscal Months of each Fiscal Year, five calendar weeks and (iii) in the case of the twelfth Fiscal Month of each Fiscal Year, the period from the first day following the eleventh Fiscal Month of such Fiscal Year through the last day of such Fiscal Year, in accordance with the fiscal accounting calendar of BCF Holdings and its Subsidiaries.
“ Fiscal Quarter ” means any fiscal quarter of any Fiscal Year, which quarter shall generally end on (i) in the case of the first three Fiscal Quarters of each Fiscal Year, on the date that is 13 weeks after the last day of the preceding Fiscal Quarter and (ii) in the case of the last Fiscal Quarter of each Fiscal Year, on the last day of such Fiscal Year, in accordance with the fiscal accounting calendar of BCF Holdings and its Subsidiaries.
“ Fiscal Year ” means any period of twelve consecutive Fiscal Months ending on the Saturday closest to January 31 of any calendar year.
“ Fixed Assets ” means Equipment and Real Estate.
“ Flood Insurance Laws ” means, collectively, (i) the National Flood Insurance Act of 1968 as now or hereafter in effect or any successor statute thereto, (ii) the Flood Disaster Protection Act of 1973 as now or hereafter in effect or any successor statue thereto, (iii) the National Flood Insurance Reform Act of 1994 as now or hereafter in effect or any successor statute thereto and (iv) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statute thereto.
“ Foreign Lender ” means any Lender that is organized under the laws of a jurisdiction other than the United States of America or any State thereof or the District of Columbia.
“ Foreign Subsidiary ” means any Subsidiary that is organized under the laws of a jurisdiction other than the United States of America or any State thereof or the District of Columbia, or any of its territories or possessions.
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“ Fund ” means any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.
“ Funded Debt ” means, as to any Person, all Indebtedness for borrowed money of such Person that matures more than one year from the date of its creation or arises under a revolving credit or similar agreement that obligates the lender or lenders to extend credit during a period of more than one year from such date, including all current maturities and current sinking fund payments in respect of such Indebtedness whether or not required to be paid within one year from the date of its creation and, in the case of the Borrower, Indebtedness in respect of the Term Loans and Revolving Credit Loans (as defined in the ABL Agreement).
“ Funding Office ” means the office of the Administrative Agent specified in SECTION 9.01 or such other office as may be specified from time to time by the Administrative Agent as its funding office by written notice to the Borrower and the Lenders.
“ GAAP ” means generally accepted accounting principles in effect from time to time in the United State of America which are consistent with those promulgated or adopted by the Financial Accounting Standards Board and its predecessors (or successors) in effect and applicable to that accounting period in respect of which reference to GAAP is being made.
“ 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, tribunal, 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 any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “ primary obligor ”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation, provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business or customary and reasonable indemnity obligations, including but not limited to, those in effect on the Closing Date or entered into in connection with any Permitted Acquisition or Permitted Disposition (other than such obligations with respect to Indebtedness). The amount of any Guarantee shall be deemed to be an amount equal to the stated or determinable amount of the related primary obligation, or portion thereof, in respect of which such Guarantee is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof as determined by the guaranteeing Person in good faith.
“ 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, mold, fungi or similar bacteria, and all other substances or wastes of any nature regulated pursuant to any Environmental Law because of their dangerous or deleterious properties, including any material listed as a hazardous substance under Section 101(14) of CERCLA.
“ Hedge Agreement ” means any derivative agreement, or any interest rate protection agreement, interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement.
“ Immaterial Subsidiary ” means a Subsidiary of BCF Holdings for which (a) the assets of such Subsidiary constitute less than or equal to 1% of the total assets of BCF Holdings and its Subsidiaries on a consolidated basis and collectively with all Immaterial Subsidiaries, less than or equal to 5% of the total assets of BCF Holdings and its
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Subsidiaries on a consolidated basis, and (b) the revenues of such Subsidiary account for less than or equal to 1% of the total revenues of BCF Holdings and its Subsidiaries on a consolidated basis and collectively with all Immaterial Subsidiaries, less than or equal to 5% of the total revenues of BCF Holdings and its Subsidiaries on a consolidated basis.
“ Incremental Effective Date ” has the meaning provided in SECTION 2.05(a).
“ Incremental Term Lender ” has the meaning provided in SECTION 2.05(b).
“ Incremental Term Loan ” has the meaning provided in SECTION 2.05(a).
“ Incremental Term Loan Amendment ” has the meaning provided in SECTION 2.05(c).
“ Indebtedness ” of any Person means, without duplication:
(a) All obligations of such Person for borrowed money (including any obligations which are without recourse to the credit of such Person);
(b) All obligations of such Person evidenced by bonds, debentures, notes or similar instruments;
(c) All obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person;
(d) All obligations of such Person in respect of the deferred purchase price of property or services (excluding accrued expenses and accounts payable incurred in the ordinary course of business);
(e) 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) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed or is limited in recourse;
(f) All Guarantees by such Person of Indebtedness of others;
(g) All Capital Lease Obligations of such Person;
(h) All obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty;
(i) All obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances;
(j) The Agreement Value of all Hedge Agreements;
(k) The principal and interest portions of all rental obligations of such Person under any Synthetic Lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an operating lease in accordance with GAAP;
(l) Indebtedness consisting of Earn-Out Obligations in connection with Permitted Acquisitions but only to the extent that the contingent consideration relating thereto is not paid within thirty (30) days after the amount due is finally determined; and
(m) All mandatory obligations of such Person to purchase, redeem, retire, defease or otherwise make any payment in respect of any Capital Stock of such Person (including, without limitation, Disqualified Capital Stock);
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Indebtedness shall not include (A) any sale-leaseback transactions to the extent the lease or sublease thereunder is not required to be recorded under GAAP as a Capital Lease Obligation, (B) any obligations relating to overdraft protection and netting services, (C) any preferred stock required to be included as Indebtedness in accordance with GAAP, or (D) items that would appear as a liability on a balance sheet prepared in accordance with GAAP as a result of the application of EITF 97-10, “The Effects of Lessee Involvement in Asset Construction.”
The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.
“ Indemnified Taxes ” means Taxes other than Excluded Taxes.
“ Indemnitee ” has the meaning provided in SECTION 9.03(b).
“ Information ” has the meaning provided in SECTION 9.15.
“ Informational Website ” has the meaning provided in SECTION 5.01.
“ Installment ” has the meaning provided in SECTION 2.04(a).
“ Installment Date ” has the meaning provided in SECTION 2.04(a).
“ Instruments ” has the meaning assigned to such term in the Security Agreement.
“ Intellectual Property ” means all present and future: trade secrets, know-how and other proprietary information; trademarks, Internet domain names, service marks, trade dress, trade names, business names, designs, logos, slogans (and all translations, adaptations, derivations and combinations of the foregoing), indicia and other source and/or business identifiers, all of the goodwill related thereto, and all registrations and applications for registrations thereof; works of authorship and other copyrighted works (including copyrights for computer programs), and all registrations and applications for registrations thereof; inventions (whether or not patentable) and all improvements thereto; patents and patent applications, together with all continuances, continuations, continuations-in-part, divisions, revisions, extensions, reissuances, and reexaminations thereof; industrial design applications and registered industrial designs; books, records, writings, computer tapes or disks, flow diagrams, specification sheets, computer software, source codes, object codes, executable code, data, databases and other physical manifestations, embodiments or incorporations of any of the foregoing; all other intellectual property and intellectual property rights; all rights to sue and recover at law or in equity for any past, present or future infringement, dilution or misappropriation, or other violation thereof; and all common law and other rights throughout the world in and to all of the foregoing.
“ Intellectual Property Security Agreement ” means the Intellectual Property Security Agreement dated as of the Closing Date among the Loan Parties and the Collateral Agent for its own benefit and for the benefit of the other Credit Parties, granting a Lien in the Intellectual Property of the Loan Parties, as amended, restated, supplemented or otherwise modified and in effect from time to time.
“ Intercreditor Agreement ” means, collectively, the ABL Intercreditor Agreement and, following the effectiveness thereof, any Pari Passu Lien Intercreditor Agreement and any Second Lien Intercreditor Agreement.
“ Interest Payment Date ” means (a) with respect to any Prime Rate Loan, the last day of each Fiscal Quarter and (b) with respect to any LIBO Loan, on the last day of the Interest Period applicable to the Borrowing of which such LIBO Loan is a part, and, in addition, if such LIBO Loan has an Interest Period of greater than three months, on the last day of every third month of such Interest Period.
“ Interest Period ” means, with respect to any LIBO Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one (1), two (2), three (3),
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or six (6), and, if agreed to by all applicable Lenders, nine (9) or twelve (12) months thereafter (or such shorter period, to the extent available to all Lenders and as to which the Administrative Agent may reasonably consent) as the Borrower may elect by notice to the Administrative Agent in accordance with the provisions of this Agreement; provided , however , that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (b) any Interest Period of one month or more that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month during which such Interest Period ends) shall end on the last Business Day of the calendar month of such Interest Period and (c) any Interest Period that would otherwise end after the Maturity Date for any Class of Term Loans shall end on the Maturity Date for such Class of Term Loans. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.
“ Inventory ” has the meaning assigned to such term in the Security Agreement.
“ Investment ” means with respect to any Person, any direct or indirect acquisition or investment by such Person, whether by means of:
(a) Any Capital Stock of another Person, evidence of Indebtedness or other security of another Person, including any option, warrant or right to acquire the same;
(b) Any loan, advance, contribution to capital, extension of credit (except for current trade and customer accounts receivable for inventory sold or services rendered in the ordinary course of business) to, or guaranty of Indebtedness of, another Person; and
(c) Any Acquisition;
in all cases whether now existing or hereafter made. For purposes of calculation, the amount of any Investment outstanding at any time shall be the aggregate cash Investment less all cash returns, cash dividends and cash distributions (or the fair market value of any non-cash returns, dividends and distributions) received by such Person.
“ Investment Fund ” means (i) Sankaty Advisors, LLC and any affiliate of Sankaty Advisors, LLC that Sankaty Advisors, LLC manages, makes investment decisions for or controls and (ii) any affiliate of Bain Capital Partners, LLC that is a bona fide diversified debt fund or a bona fide diversified investment vehicle that is engaged in the making, purchasing, holding or otherwise investing in commercial loans, bonds and similar extensions of credit in the ordinary course.
“ ISDA Master Agreement ” means the form entitled “2002 ISDA Master Agreement” or such other replacement form then currently published by the International Swap and Derivatives Association, Inc., or any successor thereto.
“ Joinder Agreement ” means an agreement, in substantially the form attached hereto as Exhibit D , pursuant to which, among other things, a Person becomes a party to, and bound by the terms of, this Agreement and/or the other Loan Documents in the same capacity and to the same extent as a Facility Guarantor, as the Administrative Agent may determine.
“ Lease ” means any agreement pursuant to which a Loan Party is entitled to the use or occupancy of any space in a structure, land, improvements or premises for any period of time.
“ Lender Participation Notice ” has the meaning provided in SECTION 2.16(d)(iii).
“ Lenders ” means the Lenders having Commitments or Term Loans from time to time or at any time, and each assignee that becomes a party to this Agreement as set forth in SECTION 9.04(b).
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“ LIBO Borrowing ” means a Borrowing comprised of LIBO Loans.
“ LIBO Loan ” means any Term Loan bearing interest at a rate determined by reference to the Adjusted LIBO Rate in accordance with the provisions of Article II.
“ LIBO Rate ” means, with respect to any LIBO Borrowing for any Interest Period, the rate appearing on Reuters Screen LIBOR01 Page (or on any successor or substitute page of such Page, or any successor to or substitute for such Page, providing rate quotations comparable to those currently provided on such Page, as determined by the Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to dollar deposits in the London interbank market) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, as the rate for dollar deposits with a maturity comparable to such Interest Period. In the event that such rate is not available at such time for any reason, then the “ LIBO Rate ” with respect to such LIBO Borrowing for such Interest Period shall be the rate at which dollar deposits of $5,000,000 and for a maturity comparable to such Interest Period are offered by the principal London office of the Administrative Agent in immediately available funds in the London interbank market at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period.
“ Lien ” means, with respect to any asset, (a) any mortgage, deed of trust, lien (statutory or otherwise), pledge, hypothecation, encumbrance, collateral assignment, charge or security interest in, on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.
“ Loan Account ” has the meaning provided in SECTION 2.20.
“ Loan Documents ” means this Agreement, the Notes, the Security Documents, the Facility Guarantees, the Intercreditor Agreements, and any other instrument or agreement now or hereafter executed and delivered in connection herewith, each as amended and in effect from time to time.
“ Loan Party ” or “ Loan Parties ” means the Borrower and the Facility Guarantors.
“ Margin Stock ” has the meaning assigned to such term in Regulation U.
“ Material Adverse Effect ” means any event, facts, or circumstances, which has a material adverse effect on (i) the business, assets or financial condition of the Loan Parties taken as a whole or (ii) the validity or enforceability of this Agreement or the other Loan Documents, taken as a whole, or the rights or remedies of the Secured Parties hereunder or thereunder, taken as a whole.
“ Material Indebtedness ” means Indebtedness (other than the Obligations) of the Loan Parties, individually or in the aggregate, having an aggregate principal amount exceeding $50,000,000.
“ Maturity Date ” means (i) for Term B Loans, February 23, 2017, (ii) for Incremental Term Loans of any Series, the date specified as the “Maturity Date” for such Incremental Term Loans in the applicable Incremental Term Loan Amendment and (iii) for the Extended Term Loans of any Extension Series, the date specified as the “Maturity Date” for such Extended Term Loans in the applicable Extended Term Loan Amendment.
“ Maximum Incremental Amount ” means $150,000,000.
“ Maximum Rate ” has the meaning provided in SECTION 9.13.
“ Minority Lenders ” has the meaning provided in SECTION 9.02(c)(i).
“ MNPI ” means, on any date, material non-public information with respect to any Loan Party or the Term Loans that has not been disclosed to the Lenders (other than Lenders that do not wish to receive MNPI or any such information that is disclosed to all Lenders in accordance with the confidentiality provisions of this Agreement)
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prior to such date to the extent such information could reasonably be expected to have a material effect upon, or otherwise be material to, a Lender’s decision to assign Term Loans to, or acquire Term Loans from, a member of the Sponsor Group or to participate in a Discounted Voluntary Prepayment, as applicable.
“ Moody’s ” means Moody’s Investors Service, Inc. and any successor thereto.
“ Mortgaged Property ” means all Real Estate listed on Schedule 5.14.
“ Mortgages ” means the mortgages and deeds of trust and any and all other security documents granting a Lien on Mortgaged Property between the Loan Party owning, leasing or otherwise holding the Mortgaged Property encumbered thereby and the Collateral Agent for its own benefit and the benefit of the other Secured Parties which shall be in form reasonably satisfactory to the Collateral Agent.
“ Multiemployer Plan ” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.
“ Net Proceeds ” means, with respect to any event, (a) the cash proceeds received in respect of such event, including (i) any cash received in respect of any non-cash proceeds or amounts escrowed pursuant to clause (iv) of this definition, but only as and when received, (ii) in the case of a casualty, insurance proceeds, and (iii) in the case of a condemnation or similar event, condemnation awards and similar payments, in each case net of (b) the sum of (i) all fees and out-of-pocket fees and expenses (including appraisals and brokerage, legal, title and recording or transfer tax expenses, underwriting discounts and commissions) paid by any Loan Party or a Subsidiary to third parties in connection with such event, and (ii) in the case of a sale or other disposition of an asset (including pursuant to a casualty or condemnation), the amount of all payments required to be made by any Loan Party or any of their respective Subsidiaries as a result of such event to repay (or to establish an escrow for the repayment of) any Indebtedness (other than the Obligations and other obligations secured by Liens ranking pari passu with the Obligations pursuant to a Pari Passu Lien Intercreditor Agreement) secured by a Permitted Encumbrance on the assets disposed of that is senior to the Lien of the Collateral Agent; provided that to the extent any Qualifying Secured Debt with a Lien ranking pari passu with the Liens securing the Obligations pursuant to the terms of a Pari Passu Lien Intercreditor Agreement requires a prepayment from the proceeds of any disposition or casualty event, then the amount of Net Proceeds otherwise actually required to be applied to prepay Term Loans pursuant to SECTION 2.17(a) or (b), as applicable, shall be the product of (x) the amount of such Net Proceeds as determined above and (y) a fraction (A) the numerator of which is the aggregate principal amount of Term Loans and (B) the denominator of which is the aggregate principal amount of Term Loans and such other Qualifying Secured Debt requiring such prepayment, (iii) capital gains or other income taxes paid or payable as a result of any such sale or disposition (after taking into account any available tax credits or deductions) and (iv) any funded escrow established pursuant to the documents evidencing any such sale or disposition to secure any indemnification obligations or adjustments to the purchase price associated with any such sale or disposition.
“ New Lending Office ” has the meaning provided in SECTION 2.23(f).
“ Non-Core Business Segment ” means any business segment or separate department of the Loan Parties which contributed less than 5% of the Consolidated EBITDA of the Loan Parties as of the Fiscal Year immediately prior to the date of such calculation.
“ Note ” means any promissory note of the Borrower substantially in the form of Exhibit C (in the case of Term B Loans), payable to the applicable Lender, evidencing the Term Loan(s) made by the such Lender to the Borrower.
“ Obligations ” means (a) (i) the principal of, and interest (including all interest that accrues after the commencement of any case or proceeding by or against the Borrower or any Facility Guarantor under the Bankruptcy Code or any state or federal bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding) on the Term Loans and Facility Guarantees and (ii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise, of the Loan Parties to the Secured Parties under this Agreement and the other Loan Documents and (b) the due and punctual
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payment and performance of all the covenants, agreements, obligations and liabilities of each Loan Party under or pursuant to this Agreement and the other Loan Documents.
“ Other Taxes ” means any and all current 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 of, or otherwise with respect to, any Loan Document.
“ Parent ” means Burlington Coat Factory Investments Holdings, Inc.
“ Pari Passu Lien Intercreditor Agreement ” means an agreement substantially in the form of Exhibit G to this Agreement entered into by the Collateral Agent, the Administrative Agent and the agents for the holders of any Qualifying Secured Debt that is intended to be secured by a Lien on the Collateral ranking pari passu with the Lien of the Security Documents.
“ Participant ” has the meaning provided in SECTION 9.04(c)(i).
“ Participant Register ” has the meaning provided in SECTION 9.04(c)(i).
“ PBGC ” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.
“ Permitted Acquisition ” means an Acquisition in which each of the following conditions are satisfied:
(a) No Default or Event of Default then exists or would arise from the consummation of such Acquisition;
(b) If the Acquisition is an Acquisition of Capital Stock, (i) a Loan Party or a Subsidiary of a Loan Party shall acquire and own, directly or indirectly, a majority of the Capital Stock in the Person being acquired and (ii) shall Control a majority of any voting interests or otherwise Control the governance of the Person being acquired;
(c) Any material assets acquired shall be utilized in, and if the Acquisition involves a merger, consolidation or stock acquisition, the Person which is the subject of such Acquisition shall be engaged in, a business otherwise permitted to be engaged in by the Borrower under this Agreement;
(d)(i) If each Person which is the subject of such Permitted Acquisition and any Indebtedness incurred in connection therewith will become a Loan Party (or the assets of each such Person will be acquired by a Loan Party) upon the consummation of such Permitted Acquisition, on a Pro Forma Basis, the Borrower would be in compliance, as of the last day of the Fiscal Quarter most recently ended for which financial statements have been or were required to have been delivered hereunder, with SECTION 6.10(a) and (b) and (ii) if any Person which is the subject of such Permitted Acquisition will not become a Loan Party upon the consummation of such Permitted Acquisition, on a Pro Forma Basis, (x) the Consolidated Leverage Ratio would be at least 0.25 to 1.0 less than the maximum Consolidated Leverage Ratio then permitted under SECTION 6.10(a) as of the last day of the Fiscal Quarter most recently ended for which financial statements have been or were required to have been delivered hereunder and (y) the Borrower would be in compliance, as of the last day of the Fiscal Quarter most recently ended for which financial statements have been or were required to have been delivered hereunder, with SECTION 6.10(b).
“ Permitted Capital Expenditure Amount ” has the meaning provided in SECTION 6.10(c).
“ Permitted Cure Security ” means common equity securities of BCF Holdings, the Parent or the Borrower or other equity securities of BCF Holdings, the Parent or the Borrower not constituting Disqualified Capital Stock.
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“ Permitted Disposition ” means any of the following:
(a) licenses of Intellectual Property of a Loan Party or any of its Subsidiaries entered into in the ordinary course of business;
(b) licenses for the conduct of licensed departments within the Loan Parties’ or any of their Subsidiaries’ Stores in the ordinary course of business;
(c) as long as no Specified Default hereof then exists or would arise therefrom, bulk sales or other dispositions of the Loan Parties and their Subsidiaries’ Inventory not in the ordinary course of business in connection with Store closings, at arm’s length, provided that (i) such Store closures and related Inventory dispositions shall not exceed, in any Fiscal Year of BCF Holdings and its Subsidiaries, 15% of the number of the Loan Parties’ and their Subsidiaries’ Stores as of the beginning of such Fiscal Year (net of Store relocations (i) occurring substantially contemporaneously with the related Store closure date or (ii) wherein a binding lease has been entered into on or prior to the related Store closure date) as set forth in the Compliance Certificate delivered pursuant to SECTION 5.01(d) and (ii) as of any date after the Closing Date, the aggregate number of such Store closures since the Closing Date shall not exceed, when taken together with (but without duplication of) any Stores disposed of or leased pursuant to clauses (g) and (o)(i) of this definition, 30% of the greater of (x) the number of the Loan Parties’ Stores and their Subsidiaries’ in existence as of the Closing Date or (y) the number of the Loan Parties’ Stores and their Subsidiaries’ as of the first day of any Fiscal Year beginning after the Closing Date (net of Store relocations (i) occurring substantially contemporaneously with the related Store closure date or (ii) wherein a binding lease has been entered into on or prior to the related Store closure date) as set forth in the Compliance Certificate delivered pursuant to SECTION 5.01(d); provided further that all Net Proceeds received in connection therewith are applied to the Term Loans, if then required in accordance with SECTION 2.17(a);
(d) without duplication of the provisions of clause (c) of this definition, terminations of Leases in the ordinary course of business;
(e) dispositions of assets (other than Real Estate), including abandonment of or failure to maintain Intellectual Property, in the ordinary course of business that is worn, damaged, obsolete, uneconomical or, in the judgment of a Loan Party or its Subsidiary, no longer used or useful or necessary in, or material to, its business or that of any Subsidiary;
(f) sales, transfers and dispositions (i) among the Loan Parties, (ii) among Subsidiaries that are not Loan Parties and (iii) from Subsidiaries that are not Loan Parties to any Loan Party;
(g) sales and transfers (including sale-leaseback transactions) of Real Estate of any Loan Party or any of its Subsidiaries’ (i) as long as (A) no Specified Default then exists or would arise therefrom, and (B) such sale or transfer is made for fair market value and the consideration received for such sale or transfer is at least 85% cash, and (ii) involving pending real estate dispositions listed on Schedule 1.1(b) , as long as (A) such sale or transfer is made for fair market value and (B) the consideration received for such sale or transfer is at least 85% cash; provided that the aggregate amount of all Stores disposed of pursuant to this clause (g), when taken together with (but without duplication of) any Stores closed or leased pursuant to clauses (c) and (o)(i) of this definition shall not exceed 30% of the greater of (x) the number of the Loan Parties’ and their Subsidiaries’ Stores in existence as of the Closing Date or (y) the number of the Loan Parties’ and their Subsidiaries’ Stores as of the first day of any Fiscal Year beginning after the Closing Date (net of Store relocations (i) occurring substantially contemporaneously with the related Store closure date or (ii) wherein a binding lease has been entered into on or prior to the related Store closure date) as set forth in the Compliance Certificate delivered pursuant to SECTION 5.01(d); provided further that all Net Proceeds received in connection therewith are applied to the Term Loans if then required in accordance with SECTION 2.17(a).
(h) sales, discounting or forgiveness of Accounts in the ordinary course of business or in connection with the collection or compromise thereof;
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(i) leases, subleases, licenses and sublicenses of real or personal property (other than Intellectual Property) entered into by Loan Parties and their Subsidiaries in the ordinary course of business at arm’s length and on market terms;
(j) sales of non-core assets acquired in connection with Permitted Acquisitions and sales of Real Estate acquired in a Permitted Acquisition which, within thirty (30) days of the date of acquisition, are designated in writing to the Administrative Agent as being held for sale and not for the continued operation of a Store;
(k) as long as no Event of Default would arise therefrom, sales or other dispositions of Permitted Investments described in clauses (a) through and including (e) of the definition thereof;
(l) any disposition of Real Estate to a Governmental Authority as a result of a condemnation of such Real Estate;
(m) the making of Permitted Investments and payments permitted under SECTION 6.06;
(n) Sales, transfers and dispositions as set forth on Schedule 6.05 ;
(o)(i) Leasing of Real Estate (other than any subleases described in subclause (ii) of this clause (o)) no longer used or useful in the business of the Loan Parties to the extent not otherwise prohibited hereunder; provided that the aggregate amount of all Stores leased pursuant to this clause (o)(i), when taken together with (but without duplication of) any Stores closed or disposed of pursuant to clauses (c) and (g) of this definition, shall not exceed 30% of the greater of (x) the number of the Loan Parties’ and their Subsidiaries’ Stores in existence as of the Closing Date or (y) the number of the Loan Parties’ and their Subsidiaries’ Stores as of the first day of any Fiscal Year beginning after the Closing Date (net of Store relocations (i) occurring substantially contemporaneously with the related Store closure date or (ii) wherein a binding lease has been entered into on or prior to the related Store closure date) as set forth in the Compliance Certificate delivered pursuant to SECTION 5.01(d) and (ii) subleasing of partial interests in Real Estate (a portion of which shall continue to be used in the business of the Borrower or any of its Subsidiaries) in the ordinary course of business and which does not materially interfere with the business of the Borrower and its Subsidiaries;
(p) forgiveness of Permitted Investments described in clauses (g)(ii) and (k) of the definition thereof;
(q) as long as no Event of Default exists or would arise as a result of the transaction, sales of a Subsidiary or any business segment which is a Non-Core Business Segment, or any portion thereof (each such sale, a “ Sale of Non-Core Business Segment ”) to a Person other than a Loan Party for fair market value and so long as the consideration received for such sale or transfer is at least 85% cash, provided that (i) all Net Proceeds, if any, received in connection with any such sales are applied to the Term Loans if then required in accordance with SECTION 2.17(a) hereof, and (ii) on a Pro Forma Basis, the consummation of such Sale of Non-Core Business Segment, the Consolidated Leverage Ratio would not be greater than the Consolidated Leverage Ratio immediately prior to such Sale of Non-Core Business, in each case as of the last day of the Fiscal Quarter most recently ended for which financial statements have been or were required to have been delivered hereunder;
(r) exchanges or swaps, including, but not limited to, transactions covered by Section 1031 of the Code, of Leases and other Real Estate of the Loan Parties and their Subsidiaries so long as such exchange or swap is made for fair market value and on an arm’s length basis, provided , that (i) all Net Proceeds, if any, received in connection with any such exchange or swap are applied to the Term Loans if then required in accordance with SECTION 2.17(a) and (ii) the aggregate amount of such exchanges or swaps shall not exceed 20% of the greater of (x) the number of the Loan Parties’ and their Subsidiaries’ Stores in existence as of the Closing Date or (y) the number of the Loan Parties’ and their Subsidiaries’
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Stores as of the first day of any Fiscal Year beginning after the Closing Date as set forth in the Compliance Certificate delivered pursuant to SECTION 5.01(d); and
(s) other dispositions of assets (other than Real Estate) in an aggregate amount for all Loan Parties not to exceed $10,000,000 in any Fiscal Year, as long as (A) no Event of Default then exists or would arise therefrom, and (B) such sale or transfer is made for fair market value and the consideration received for such sale or transfer is at least 85% cash, and provided that all Net Proceeds, if any, received in connection with any such sales are applied to the Term Loans if then required in accordance with SECTION 2.17(a) hereof.
“ Permitted Encumbrances ” means:
(a) Liens imposed by law for Taxes that are not required to be paid pursuant to SECTION 5.05;
(b) Carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s, landlord’s and other like Liens imposed by Applicable Law, (i) arising in the ordinary course of business and securing obligations that are not overdue by more than thirty (30) days, (ii) (A) that are being contested in good faith by appropriate proceedings, (B) the applicable Loan Party or Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (C) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (iii) the existence of which would not reasonably be expected to result in a Material Adverse Effect;
(c) pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations;
(d) deposits to secure or relating to the performance of bids, trade contracts (other than for Indebtedness), leases (other than Capital Lease Obligations), statutory obligations, surety and appeal bonds, performance bonds (and Liens arising in accordance with Applicable Law in connection therewith), and other obligations of a like nature, in each case in the ordinary course of business;
(e) judgment Liens in respect of judgments that do not constitute an Event of Default under SECTION 7.01(k);
(f) easements, covenants, conditions, restrictions, building code laws, zoning restrictions, other land use laws, rights-of-way, development, site plan or similar agreements 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 when used in a manner consistent with current usage or materially interfere with the ordinary conduct of business of a Loan Party as currently conducted and such other minor title defects, or survey matters that are disclosed by current surveys, but that, in each case, do not interfere with the current use of the Property in any material respect;
(g) any Lien on any property or asset of any Loan Party set forth on Schedule 6.02 , provided that, if such Lien secured Indebtedness, such Lien shall secure only the Indebtedness listed on Schedule 6.01 as of the Closing Date (and extensions, renewals and replacements thereof permitted under SECTION 6.01);
(h) Liens on fixed or capital assets acquired by any Loan Party or any of its Subsidiaries to secure Indebtedness permitted under clause (e) of the definition of Permitted Indebtedness so long as (i) such Liens and the Indebtedness secured thereby are incurred prior to or within one hundred and eighty (180) days after such acquisition or the completion of the construction or improvement thereof (other than refinancings thereof permitted hereunder), (ii) the Indebtedness secured thereby does not exceed 100% of the cost of acquisition or improvement of such fixed or capital assets, and (iii) such Liens shall not extend to any other property or assets of the Loan Parties or any of their Subsidiaries;
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(i) Liens in favor of the Collateral Agent, for its own benefit and the benefit of the other Secured Parties;
(j) landlords’ and lessors’ Liens in respect of rent not in default for more than sixty (60) days or the existence of which, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect;
(k) possessory Liens in favor of brokers and dealers arising in connection with the acquisition or disposition of Investments owned as of the date hereof and other Permitted Investments, provided that such liens (a) attach only to such Investments or other Investments held by such broker or dealer and (b) secure only obligations incurred in the ordinary course and arising in connection with the acquisition or disposition of such Investments and not any obligation in connection with margin financing;
(l) Liens arising solely by virtue of any statutory or common law provisions relating to banker’s liens, liens in favor of securities intermediaries, rights of setoff or similar rights and remedies as to deposit accounts or securities accounts or other funds maintained with depository institutions or securities intermediaries;
(m) Liens on Real Estate; provided that such Liens shall only secure obligations with respect to a Permitted Real Estate Financing;
(n) Liens attaching solely to cash earnest money deposits in connection with any letter of intent or purchase agreement in connection with a Permitted Acquisition;
(o) Liens arising from precautionary UCC filings regarding “true” operating leases or the consignment of goods to a Loan Party;
(p) voluntary Liens on Fixed Assets in existence at the time such Fixed Assets are acquired pursuant to a Permitted Acquisition or on Fixed Assets of a Subsidiary of any Loan Party in existence at the time such Subsidiary is acquired pursuant to a Permitted Acquisition; provided that such Liens are not incurred in connection with or in anticipation of such Permitted Acquisition and do not attach to any other assets of any Loan Party or any of its Subsidiaries;
(q) Liens in favor of customs and revenues authorities imposed by Applicable Law arising in the ordinary course of business in connection with the importation of goods and securing obligations (i) that are not overdue by more than thirty (30) days, (ii)(A) that are being contested in good faith by appropriate proceedings, (B) the applicable Loan Party or Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (C) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (iii) the existence of which would not reasonably be expected to result in a Material Adverse Effect;
(r) Liens granted by the Loan Parties or any of their Subsidiaries to the secured parties under the ABL Facility and any refinancings thereof permitted hereunder so long as such Liens are subject to the terms of the ABL Intercreditor Agreement;
(s) any interest or title of a licensor, sublicensor, lessor or sublessor under any license or operating or true lease agreement;
(t) leases or subleases granted to third Persons in the ordinary course of business;
(u) licenses or sublicenses of Intellectual Property granted in the ordinary course of business;
(v) the replacement, extension or renewal of any Permitted Encumbrance; provided that such Lien shall at no time be extended to cover any assets or property other than such assets or property subject thereto on the Closing Date or the date such Lien was incurred, as applicable;
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(w) Liens on insurance proceeds incurred in the ordinary course of business in connection with the financing of insurance premiums;
(x) Liens on securities which are the subject of repurchase agreements incurred in the ordinary course of business;
(y) Liens arising by operation of law under Article 4 of the UCC in connection with collection of items provided for therein;
(z) Liens arising by operation of law under Article 2 of the UCC in favor of a reclaiming seller of goods or buyer of goods;
(aa) Liens on deposit accounts or securities accounts in connection with overdraft protection and netting services;
(bb) security given to a public or private utility or any Governmental Authority as required in the ordinary course of business;
(cc) Liens in the nature of the right of setoff in favor of counterparties to contractual agreements with the Loan Parties or any of their Subsidiaries in the ordinary course of business;
(dd) other Liens not securing Indebtedness in an amount not to exceed $10,000,000 in the aggregate at any time outstanding; and
(ee) Liens on Collateral securing Qualifying Secured Debt;
provided , however , that, except as provided in any one or more of clauses (a) through (ee) above, the term “Permitted Encumbrances” shall not include any Lien securing Indebtedness for borrowed money.
“ Permitted Indebtedness ” means each of the following:
(a) Indebtedness created under the Loan Documents;
(b) Indebtedness set forth on Schedule 6.01 ;
(c) Indebtedness of (i) any Loan Party to any other Loan Party, (ii) any Loan Party to any Subsidiary that is not a Subsidiary Guarantor and (iii) any Subsidiary that is not a Subsidiary Guarantor to any Subsidiary that is not a Subsidiary Guarantor;
(d) Guarantees by any Loan Party or any of its Subsidiaries of Indebtedness or other obligations arising in the ordinary course of business of any other Loan Party or any of its Subsidiaries;
(e) Purchase money Indebtedness of any Loan Party or any of its Subsidiaries to finance the acquisition or improvement of any fixed or capital assets (including Real Estate), including Capital Lease Obligations (including therein any Indebtedness incurred in connection with sale-leaseback transactions permitted under clause (k) of this definition), and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof, provided that the aggregate principal amount of Indebtedness permitted by this clause (e) outstanding at any time, when aggregated with the amount of Permitted Refinancings in respect thereof pursuant to clause (y) below, shall not exceed the greater of $75,000,000 or three percent (3%) of the book value of the Consolidated tangible assets of the Loan Parties and their Subsidiaries determined in accordance with GAAP;
(f) Indebtedness under Hedge Agreements, other than for speculative purposes, entered into in the ordinary course of business;
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(g) Contingent liabilities under surety bonds, customs and appeal bonds, governmental contracts and leases or similar instruments incurred in the ordinary course of business;
(h) Indebtedness under the Senior Notes, provided that in no event shall the principal amount of such Indebtedness incurred in reliance on this clause (h) increase in excess of the amounts outstanding as of the Closing Date (other than any increase in the principal amount of the Senior Notes to the extent otherwise permitted under clause (u) of this definition);
(i) Indebtedness under the ABL Facility; provided that in no event shall the aggregate principal amount of loans and the face amount of letters of credit and bank guaranties issued under the ABL Facility exceed the greater of (x) $750,000,000 and (y) the Borrowing Base as of the time such Indebtedness is incurred;
(j) Indebtedness with respect to the deferred purchase price for any Permitted Acquisition, provided that such Indebtedness does not require the payment in cash of principal (other than in respect of working capital adjustments) prior to the Maturity Date, has a maturity which extends beyond the Maturity Date, and is subordinated to the Obligations on terms customary for senior subordinated high yield debt securities (as determined in good faith by the Borrower);
(k) Indebtedness incurred in connection with sale-leaseback transactions permitted hereunder;
(l) Subordinated Indebtedness in an amount, when aggregated with the amount of Permitted Refinancing in respect thereof pursuant to clause (y), not to exceed $350,000,000 in the aggregate, provided that the proceeds of such Subordinated Indebtedness are used (i) to pay the acquisition consideration and closing and other transaction costs in connection with a Permitted Acquisition or (ii) to permanently reduce, retire or refinance the Senior Notes; and further provided that, in each case, such Subordinated Indebtedness (a) shall not have a maturity date or be subject to amortization, mandatory repurchase or redemption (except pursuant to customary asset sale and change of control provisions requiring such redemption or repurchase if and only to the extent permitted hereunder) prior to the date that is six months after the Maturity Date of each then outstanding Class of Term Loans, and (b) shall not be exchangeable or convertible into any other Indebtedness or Disqualified Stock (other than any Indebtedness that is otherwise permitted to be incurred under this Agreement at the time of such exchange or conversion);
(m) Indebtedness incurred in the ordinary course of business in connection with the financing of insurance premiums;
(n) Indebtedness of any Loan Party or any of its Subsidiaries acquired pursuant to a Permitted Acquisition (or Indebtedness assumed at the time and as a result of a Permitted Acquisition); provided that (i) such Indebtedness was not incurred in connection with, or in anticipation or contemplation of, such Permitted Acquisition; and (ii) on a Pro Forma Basis the Consolidated Interest Coverage Ratio for the most recent four Fiscal Quarter period for which financial statements have been or are required to be delivered hereunder would either be (x) at least 2.0 to 1.0 or (y) greater than the Consolidated Interest Coverage Ratio for such period immediately prior to such acquisition;
(o) Indebtedness relating to surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;
(p) Unsecured Indebtedness owed to the Sponsor, Sponsor Related Parties, and/or other stockholders of BCF Holdings and their respective Affiliates, provided that such Indebtedness does not require the payment in cash of principal or interest at a rate in excess of 10% per annum prior to the Maturity Date, has a maturity which extends beyond the Maturity Date, and is subordinated to the Obligations on terms customary for senior subordinated high yield debt securities (as determined in good faith by the Borrower);
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(q) Indebtedness constituting the obligation to make customary purchase price adjustments for working capital and indemnities in connection with Permitted Acquisitions;
(r) Guarantees and letters of credit and surety bonds (other than Guarantees of, or letters of credit and surety bonds related to, Indebtedness) issued in connection with Permitted Acquisitions and Permitted Dispositions;
(s) without duplication of any other Indebtedness, non-cash accruals of interest, accretion or amortization of original issue discount and payment-in-kind interest with respect to Indebtedness permitted hereunder;
(t) Indebtedness due to any landlord in connection with the financing by such landlord of leasehold improvements;
(u) without duplication of, or accumulation with, other categories of Indebtedness permitted hereunder, other unsecured Indebtedness of any Loan Party in an aggregate principal amount not to exceed $150,000,000 at any time outstanding;
(v) Indebtedness under Permitted Real Estate Financings;
(w) Qualifying Unsecured Debt or Qualifying Secured Debt of the Borrower or any Facility Guarantor that is either (i) issued solely for cash consideration, the net proceeds of which are applied solely to the prepayment of Term Loans in accordance with SECTION 2.17 or (ii) in the case of Qualifying Secured Debt so long as (w) no Default or Event of Default has occurred and is continuing, (x) on a Pro Forma Basis, the Borrower is in compliance with the Financial Performance Covenants as of the last day of the most recent Fiscal Quarter for which financial statements have been or are required to have been delivered hereunder, (y) on a Pro Forma Basis, the Consolidated Secured Leverage Ratio as of the last day of the most recent Fiscal Quarter for which financial statements have been or are required to have been delivered hereunder is less than or equal to 3.25 to 1.0 and (z) the aggregate principal amount of such Qualifying Secured Debt, when aggregated with the aggregate principal amount of all Incremental Term Loans, would not exceed the Maximum Incremental Amount or (iii) in the case of Qualifying Unsecured Debt, on a Pro Forma Basis (x) the Borrower is in compliance with the Financial Performance Covenants as of the last day of the most recent Fiscal Quarter and (y) the Consolidated Interest Coverage Ratio is at least 2.0 to 1.0 for the most recent four Fiscal Quarter period; and
(x) extensions, renewals and replacements of any such Indebtedness described in clauses (b), (e), (f), (h), (j), (k), (l), (m), (n), (s), (t), (v) and (w) above and this clause (y); provided that such Indebtedness constitutes a Permitted Refinancing.
“ Permitted Investments ” means each of the following:
(a) Direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America) or any state or state agency thereof, in each case maturing within one (1) year from the date of acquisition thereof;
(b) Investments in commercial paper maturing within one (1) year from the date of acquisition thereof and having, at the date of acquisition, the highest or next highest credit rating obtainable from S&P or from Moody’s;
(c) Investments in certificates of deposit, banker’s acceptances and time deposits maturing within one (1) year from the date of acquisition thereof which are issued or guaranteed by, or placed with, and demand deposit and money market deposit accounts issued or offered by, any Lender or any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof that has a combined capital and surplus and undivided profits of not less than $500,000,000;
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(d) Master demand notes and fully collateralized repurchase agreements with a term of not more than thirty (30) days for securities described in clause (a) above (without regard to the limitation on maturity contained in such clause) and entered into with a financial institution satisfying the criteria described in clause (c) above or with any primary dealer;
(e) Shares of any money market or mutual fund that has substantially all of its assets invested in the types of investments referred to in clauses (a) through (d), above;
(f) Investments existing on the Closing Date and set forth on Schedule 6.04 ;
(g) capital contributions, loans or other Investments made by (i) (x) any Loan Party to any other Loan Party and (y) any Subsidiary that is not a Subsidiary Guarantor to any other Subsidiary that is not a Subsidiary Guarantor or (ii) so long as no Specified Default then exists or would arise therefrom, any Loan Party to any Subsidiary or Affiliate of any Loan Party (other than to the Sponsors, Sponsor-Related Parties or any other stockholder of BCF Holdings, in an aggregate amount not to exceed $50,000,000 at any time outstanding, provided that the aggregate amount of all Investments of the type described in this clause (g)(ii) and clause (s) of this definition may not exceed $50,000,000 in the aggregate outstanding at any time;
(h) Guarantees constituting Permitted Indebtedness;
(i) Investments received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case in the ordinary course of business;
(j) Loans or advances to employees for the purpose of travel, entertainment or relocation in the ordinary course of business, provided that all such loans and advances to employees shall not exceed $5,000,000 in the aggregate at any time outstanding, and determined without regard to any write-downs or write-offs thereof;
(k) Investments received from purchasers of assets pursuant to dispositions permitted pursuant to SECTION 6.05;
(l) Permitted Acquisitions and existing Investments of the Persons acquired in connection with Permitted Acquisitions so long as such Investment was not made in contemplation of such Permitted Acquisition;
(m) Hedging Agreements entered into in the ordinary course of business for non-speculative purposes;
(n) To the extent permitted by Applicable Law, notes from officers and employees in exchange for equity interests of BCF Holdings purchased by such officers or employees pursuant to a stock ownership or purchase plan or compensation plan;
(o) Earnest money required in connection with Permitted Acquisitions;
(p) Investments in deposit accounts opened in the ordinary course of business;
(q) Capital Expenditures;
(r) Guarantees of Indebtedness under clause (g)(ii) above of Subsidiaries that are not Loan Parties not in excess of $50,000,000 in the aggregate at any time outstanding, provided that the aggregate amount of all Investments of the type described in this clause (r) and clause (g)(ii) of this definition may not exceed $50,000,000 in the aggregate outstanding at any time;
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(s) without duplication of, or accumulation with, other categories of Investments permitted hereunder, other Investments in an amount not to exceed $50,000,000 in the aggregate outstanding at any time; and
(t) Investments out of the portion of the Available Amount that any Loan Party or any Subsidiary elects to apply pursuant to this clause (t);
provided , however , that for purposes of calculation, the amount of any Investment outstanding at any time shall be the aggregate cash Investment less all cash returns, cash dividends and cash distributions (or the fair market value of any non-cash returns, dividends and distributions) received by such Person and less all liabilities expressly assumed by another Person in connection with the sale of such Investment.
“ Permitted Real Estate Financing ” means any financing by any Loan Party or any of its Subsidiaries that is secured solely by Real Estate of such Loan Party or such Subsidiary, as the case may be; provided that (a) the Indebtedness incurred in connection with such financing shall not be directly or indirectly Guaranteed by, or directly or indirectly collateralized or secured by, or otherwise have any recourse to, such Loan Party or any such Subsidiary or any of the assets of such Loan Party or such Subsidiary, other than (i) the Real Estate that is the subject of such financing and/or (ii) an unsecured Guarantee by the direct or indirect parent of such Loan Party or such Subsidiary that shall own the Real Estate that is the subject of such financing, (b) none of the Loan Parties or any of their Subsidiaries shall provide any other direct or indirect credit support of any kind in respect of such Indebtedness (other than the security interest on the Real Estate that is the subject of such financing as described in clause (a) above), (c) the such Loan Party or such Subsidiary, as the case may be, shall have received proceeds with respect to such financing in an amount equal to not less than 90% of the fair market value of the Real Estate that is the subject of such financing, (d) the Indebtedness incurred in connection with such financing shall have a final maturity that is no sooner than the date that is six months following the Maturity Date and a weighted average life to maturity that is no shorter than the Term Loans and (e) all Net Proceeds received in connection therewith are applied to the Term Loans as required by SECTION 2.17(c).
“ Permitted Refinancing ” means any Indebtedness that replaces or refinances any other Permitted Indebtedness, as long as, after giving effect thereto (i) the principal amount of the Indebtedness outstanding at such time is not increased (except by the amount of any accrued interest, reasonable closing costs, expenses, fees, and premium paid in connection with such extension, renewal or replacement), (ii) the result of such refinancing of or replacement shall not be an earlier maturity date or decreased weighted average life, (iii) the holders of such refinancing Indebtedness are not afforded covenants, defaults, rights or remedies, taken as a whole, which are materially more burdensome to the obligor or obligors than those contained in the Indebtedness being extended, renewed or replaced, (iv) the obligor or obligors under any such refinancing Indebtedness and the collateral, if applicable, granted pursuant to any such refinancing Indebtedness are the same (or in the case of collateral, the same or less than) as the obligor(s) and collateral under the Indebtedness being extended, renewed or replaced, (v) the subordination, to the extent applicable, and other material provisions of the refinancing Indebtedness are no less favorable to the Lenders than those terms of the Indebtedness being refinanced and (vi) the refinancing Indebtedness is not exchangeable or convertible into any other Indebtedness which does not comply with clauses (i) through (v) above.
“ Person ” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.
“ Plan ” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which the Borrower or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.
“ Pledge Agreement ” means the Pledge Agreement dated as of the Closing Date among the Loan Parties party thereto and the Collateral Agent for its own benefit and the benefit of the other Secured Parties, as amended, restated, supplemented or otherwise modified and in effect from time to time.
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“ Post Acquisition Period ” means, with respect to any Permitted Acquisition the period beginning on the date such Permitted Acquisition is consummated and ending on the last day of the fourth full consecutive Fiscal Quarter immediately following the date on which such Permitted Acquisition is consummated.
“ Prepayment Event ” means the occurrence of any of the events described in SECTIONS 2.17(a) through (c).
“ Prime Rate ” means, as to any Borrowing, for any day, the higher of: (a) the rate of interest per annum publicly announced from time to time by the Reference Lender as its “prime rate” in effect at its principal office in New York City, (b) the Federal Funds Effective Rate in effect on such day plus 1 / 2 of 1% (0.50%) per annum and (c) the Adjusted LIBO Rate for the applicable Class of Term Loans for a one-month Interest Period commencing on such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1%. The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate being charged to any customer. The Prime Rate is a rate set by the Reference Lender based upon various factors including the Reference Lender’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. If for any reason the Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate for any reason, including the inability or failure of the Administrative Agent to obtain sufficient quotations thereof in accordance with the terms hereof, the Prime Rate shall be determined without regard to clause (b) of the first sentence of this definition, until the circumstances giving rise to such inability no longer exist. Any change in the Prime Rate due to a change in the Reference Lender’s Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate shall be effective on the effective date of such change in the Reference Lender’s Prime Rate, the Federal Funds Effective Rate or the Adjusted LIBO Rate, respectively.
“ Prime Rate Loan ” means any Term Loan bearing interest at a rate determined by reference to the Prime Rate in accordance with the provisions of Article II.
“ Pro Forma Adjustment Certificate ” means a certificate of a Responsible Officer of the Borrower delivered pursuant to SECTION 5.01(m).
“ Pro Forma Adjustments ” means, for any applicable period that includes all or any part of a Fiscal Quarter included in any Post-Acquisition Period, with respect to the Acquired EBITDA of the applicable Acquired Entity or the Consolidated EBITDA of the Borrower and its Subsidiaries, the pro forma increase or decrease in such Acquired EBITDA or such Consolidated EBITDA of the Borrower and its Subsidiaries, as the case may be, projected by the Borrower in good faith as a result of (a) actions taken during such Post-Acquisition Period for the purposes of realizing reasonably identifiable and factually supportable cost savings or (b) any additional costs incurred during such Post-Acquisition Period, in each case in connection with the combination of the operations of such Acquired Entity with the operations of the Borrower and its Subsidiaries; provided that (i) so long as such actions are taken during such Post-Acquisition Period or such costs are incurred during such Post-Acquisition Period, as applicable, the cost savings related to such actions or such additional costs, as applicable, it may be assumed, for purposes of projecting such pro forma increase or decrease in such Acquired EBITDA or such Consolidated EBITDA of the Borrower and its Subsidiaries, as the case may be, that such costs savings will be realizable during the entirety of such period, or such additional costs, as applicable, will be incurred during the entirety of such period and (ii) any such pro forma increase or decrease to such Acquired EBITDA or such Consolidated EBITDA of the Borrower and its Subsidiaries, as the case may be, shall be without duplication for cost savings or additional costs already included in such Acquired EBITDA or such Consolidated EBITDA of the Borrower and its Subsidiaries, as the case may be, for such period; and provided further that any such increase, decrease and other adjustments of such Acquired EBITDA or such Consolidated EBITDA of the Borrower and its Subsidiaries, as the case may be, either (x) would be permitted to be included in pro forma financial statements prepared in accordance with Regulation S-X under the Securities Act of 1933, as amended, or (y) shall have been certified by the chief financial officer of the Borrower as having been calculated in good faith and in compliance with the requirements of this definition, provided that any such adjustment pursuant to this clause (y) does not exceed the greater of (A) $20,000,000 and (B) an amount equal to 3% of the most recently calculated Consolidated EBITDA of the Borrower and its Subsidiaries.
“ Pro Forma Basis ” means, with respect to compliance with any test or covenant hereunder, that (A) to the extent applicable, the Pro Forma Adjustments shall have been made and (B) all Specified Transactions and the
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following transactions in connection therewith shall be deemed to have occurred as of the first day of the applicable period of measurement in such test or covenant: (a) income statement items (whether positive or negative) attributable to the property or Person subject to such Specified Transaction, (i) in the case of a Disposition of all or substantially all equity interests in any Subsidiary of the Borrower or any division, product line, or facility used for operations of the Borrower or any of its Subsidiaries, shall be excluded, and (ii) in the case of a Permitted Acquisition or Investment described in the definition of “Specified Transaction,” shall be included, (b) any retirement of Indebtedness, and (c) any Indebtedness incurred or assumed by the Borrower or any of the Subsidiaries in connection therewith and if such Indebtedness has a floating or formula rate, shall have an implied rate of interest for the applicable period for purposes of this definition determined by utilizing the rate which is or would be in effect with respect to such Indebtedness as at the relevant date of determination; provided that, without limiting the application of the Pro Forma Adjustments pursuant to (a) above, the foregoing pro forma adjustments may be applied to any such test or covenant solely to the extent that such adjustments are consistent with the definition of Consolidated EBITDA and give effect to events (including operating expense reductions) that are consistent with the definition of Pro Forma Adjustment.
“ Proposed Discounted Prepayment Amount ” has the meaning provided in SECTION 2.16(d)(ii).
“ Qualifying IPO ” means an equity issuance by BCF Holdings or Parent consisting of an underwritten primary public offering (other than a public offering pursuant to a registration statement on Form S-8) of its common stock (i) pursuant to an effective registration statement filed with the SEC in accordance with the Securities Act of 1933 as amended (whether alone or in connection with a secondary public offering) and (ii) resulting in gross proceeds to BCF Holdings or Parent of at least $100,000,000.
“ Qualifying Lender ” has the meaning provided in SECTION 2.16(d)(iv).
“ Qualifying Loans ” has the meaning provided in SECTION 2.16(d)(iv).
“ Qualifying Secured Debt ” means any secured Indebtedness of any Loan Party, no part of the principal of which is required to be paid (whether by way of mandatory sinking fund, mandatory redemption, mandatory prepayment or otherwise) prior to the date that is six months after the Maturity Date of each Class of Term Loans outstanding on the date on which such Indebtedness is incurred (it being understood that any required offer to purchase such Indebtedness as a result of a change of control or asset sale shall not violate the foregoing restriction) and which is subject to either (i) the terms of the Pari Passu Lien Intercreditor Agreement as “Additional First Lien Obligations” or (ii) the terms of the Second Lien Intercreditor Agreement as obligations secured by Liens ranking junior to the Liens securing the Obligations.
“ Qualifying Unsecured Debt ” means any unsecured Indebtedness of any Loan Party, no part of the principal of which is required to be paid (whether by way of mandatory sinking fund, mandatory redemption, mandatory prepayment or otherwise) prior to the date that is six months after the Maturity Date of each Class of Term Loans outstanding on the date on which such Indebtedness is incurred (it being understood that any required offer to purchase such Indebtedness as a result of a change of control or asset sale shall not violate the foregoing restriction).
“ Real Estate ” means all interests in real property now or hereafter owned or held by any Loan Party, including all leasehold interests held pursuant to Leases and all land, together with the buildings, structures, parking areas, and other improvements thereon, now or hereafter owned by any Loan Party, including all easements, rights-of-way, appurtenances and other rights relating thereto and all leases, tenancies, and occupancies thereof.
“ Reference Lender ” means JPMorgan Chase Bank, N.A.
“ Refinancing Term Loans ” means Incremental Term Loans that are designated as Refinancing Term Loans in the applicable Incremental Term Loan Amendment.
“ Register ” has the meaning provided in SECTION 9.04(b)(iv).
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“ Regulation U ” means Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.
“ Regulation X ” means Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.
“ Reinvestment Deferred Amount ” means, with respect to a Prepayment Event described in SECTION 2.17(a) or (b), the aggregate Net Proceeds received by any Loan Party in connection therewith that are not applied to prepay the Term Loans in accordance with the provisos in SECTIONS 2.17(a) or (b), as applicable.
“ Related Parties ” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents, trustees and advisors of such Person and such Person’s Affiliates.
“ Release ” has the meaning provided in Section 101(22) of CERCLA.
“ Replacement Lender ” has the meaning provided in SECTION 9.02(c)(i).
“ Reports ” has the meaning provided in SECTION 8.13(a).
“ Required Lenders ” means, at any time and subject to SECTION 9.04(f), Lenders having Commitments aggregating more than 50% of the Total Commitments, or following the Closing Date, Lenders whose percentage of the outstanding Term Loans aggregate more than 50% of all such Term Loans.
“ Responsible Officer ” of any Person shall mean any executive officer or financial officer of such Person and any other officer or similar official thereof with responsibility for the administration of the obligations of such Person in respect of this Agreement.
“ Restricted Payment ” means any dividend or other distribution (whether in cash, securities or other property) with respect to any class of Capital Stock of a Person, or 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 Capital Stock of a Person or any option, warrant or other right to acquire any Capital Stock of a Person or on account of any return of capital to the Person’s stockholders, partners or members, provided that “Restricted Payments” shall not include any dividends payable solely in Capital Stock of a Loan Party.
“ Revolver Priority Collateral ” has the meaning set forth in the Intercreditor Agreement.
“ Revolving Credit Loans ” has the meaning set forth in the ABL Agreement.
“ Sale of Non-Core Business Segment ” has the meaning provided in the definition of “Permitted Disposition.”
“ S&P ” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. and any successor thereto.
“ SEC ” means the Securities and Exchange Commission or any Governmental Authority succeeding to any of its principal functions.
“ Second Lien Collateral Agent ” means a collateral agent for the holders of Qualifying Secured Debt which is intended to be secured by Liens ranking junior to the Liens securing the Obligations.
“ Second Lien Intercreditor Agreement ” means an intercreditor agreement in form and substance reasonably satisfactory to the Administrative Agent providing that the Liens securing the Obligations rank prior to the Liens securing Qualifying Secured Debt which is intended to be secured by Liens ranking junior to the Liens securing the Obligations.
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“ Secured Party ” means (a) each Credit Party, (b) the beneficiaries of each indemnification obligation undertaken by any Loan Party under any Loan Document, and (c) the successors and, subject to any limitations contained in this Agreement, assigns of each of the foregoing.
“ Security Agreement ” means the Security Agreement dated as of the Closing Date among the Loan Parties and the Collateral Agent for its benefit and for the benefit of the other Secured Parties, as amended, restated, supplemented or otherwise modified and in effect from time to time.
“ Security Documents ” means the Security Agreement, the Mortgages, the Intellectual Property Security Agreement, the Pledge Agreement, the Facility Guarantee, and each other security agreement or other instrument or document executed and delivered pursuant to this Agreement or any other Loan Document that creates a Lien in favor of the Collateral Agent to secure any of the Obligations.
“ Senior Notes Indenture ” means the Indenture dated as of February 24, 2011 among Parent, the Borrower, the Subsidiary Guarantors and Wilmington Trust FSB, as Trustee, as supplemented by any supplemental indenture thereto, as replaced by any indenture governing securities issued in lieu or in replacement of the Senior Notes.
“ Senior Notes ” means the $450,000,000 10% Senior Notes Due 2019 issued by the Borrower under the Senior Notes Indenture and any securities issued in lieu or in replacement thereof.
“ Senior Note Documents ” means the documents, instruments and other agreements now or hereafter executed and delivered in connection with the Senior Notes.
“ Series ” has the meaning provided in SECTION 2.05(b).
“ Software ” has the meaning assigned to such term in the Security Agreement.
“ Solvent ” means, with respect to any Person on a particular date, that on such date (a) at fair valuation on a going concern basis, all of the properties and assets of such Person are greater than the sum of the debts, including contingent liabilities, of such Person, (b) the present fair saleable value of the properties and assets of such Person on a going concern basis is not less than the amount that would be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person is able to realize upon its properties and assets and generally pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business, (d) such Person does not intend to, and does not believe that it will, incur debts beyond such Person’s ability to generally pay as such debts mature, and (e) such Person is not engaged in a business or a transaction, and is not about to engage in a business or transaction, for which such Person’s properties and assets would constitute unreasonably small capital after giving due consideration to the prevailing practices in the industry in which such Person is engaged.
“ Specified Default ” means the occurrence of any Event of Default specified in SECTION 7.01(a), SECTION 7.01(b), SECTION 7.01(c) (but only with respect to any representation made or deemed to be made by or on behalf of any Loan Party in any certificate of a Financial Officer accompanying any financial statement), SECTION 7.01(d) (but only with respect to SECTION 5.07, SECTION 5.11 and SECTION 6.10), SECTION 7.01(h), or SECTION 7.01(i).
“ Specified Indebtedness ” shall mean (i) the Senior Notes, (ii) any Qualifying Secured Debt, (iii) any Qualifying Unsecured Debt and (iv) any Permitted Refinancing of any of the foregoing Indebtedness.
“ Specified Transaction ” means any (a) disposition of all or substantially all the assets or Capital Stock of any Subsidiary or of any division or product line of the Borrower or any of the Subsidiaries, (b) Permitted Acquisition or (c) proposed incurrence of Indebtedness in respect of which compliance with the financial covenants set forth in SECTIONS 6.10(a) and (b) are by the terms of this Agreement required to be calculated on a Pro Forma Basis.
“ Sponsor Group ” means the Sponsors and the Sponsor Related Parties.
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“ Sponsor Related Parties ” means, with respect to any Person, (a) any Controlling stockholder or partner (including in the case of an individual Person who possesses Control, the spouse or immediate family member of such Person provided such Person retains Control of the voting rights, by stockholders agreement, trust agreement or otherwise of the Capital Stock owned by such spouse or immediate family member) or 80% (or more) owned Subsidiary, or (b) any trust, corporation, partnership or other entity, the beneficiaries, stockholders, partners, owners or Persons beneficially holding a 51% or more Controlling interest of which consist of such Person and/or such Persons referred to in the immediately preceding clause (a) or (c) the limited partners of the Sponsors.
“ Sponsors ” means collectively, Bain Capital Fund VIII, L.P. and its Affiliates.
“ SPV ” has the meaning assigned to such term in SECTION 9.04(e).
“ Statutory Reserve Rate ” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent is subject with respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board). Such reserve percentages shall include those imposed pursuant to such Regulation D. LIBO Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.
“ Store ” means any retail store (which includes any real property, fixtures, equipment, inventory and other property related thereto) operated, or to be operated, by any Loan Party.
“ Subordinated Indebtedness ” means Indebtedness which is expressly subordinated in right of payment to the prior payment in full of the Obligations on terms reasonably acceptable to the Agents.
“ Subsidiary ” means with respect to any Person (the “ parent ”) at any date, any corporation, limited liability company, partnership, association or other entity (a) of which Capital Stock representing more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, Controlled or held, or (b) that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.
“ Syndication Agent ” means Goldman Sachs Lending Partners LLC.
“ Synthetic Lease ” means any lease or other agreement for the use or possession of property creating obligations which do not appear as Indebtedness on the balance sheet of the lessee thereunder but which, upon the insolvency or bankruptcy of such Person, may be characterized as Indebtedness of such lessee without regard to the accounting treatment.
“ Taxes ” means any and all current or future taxes, levies, imposts, duties (including stamp duties), deductions, charges (including ad valorem charges) or withholdings imposed by any Governmental Authority, and any and all interest and penalties related thereto.
“ Term B Loan ” has the meaning provided in SECTION 2.01.
“ Term Loan Extension Amendment ” has the meaning provided in SECTION 2.06(d).
“ Term Loans ” means Term B Loans, Incremental Term Loans and Extended Term Loans.
“ Term Priority Collateral ” has the meaning set forth in the Intercreditor Agreement.
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“ Total Commitments ” means the aggregate of the Commitments of all Lenders. On the Closing Date, the Total Commitments are $1,000,000,000.
“ Transactions ” means the entry into this Agreement and the other Loan Documents executed and delivered on the Closing Date, the repayment in full of the Loan Parties’ term loans under the existing term loan agreement, dated as of April 13, 2006, between the Loan Parties, Bear Sterns Corporate Lending Inc. and the other parties thereto, the repurchase or redemption of all of the Borrower’s existing 11 1/8% senior unsecured notes due 2014 and all of Parent’s 14 1/2% senior discount notes due 2014, the Dividend Payment and the payment of fees and expenses in connection with the foregoing.
“ Transition Period ” means the period from and including May 31, 2009 to and including January 30, 2010.
“ Type ,” when used in reference to any Term Loan or Borrowing, refers to whether the rate of interest on such Term Loan, or on the Term Loans comprising such Borrowing, is determined by reference to the Adjusted LIBO Rate or the Prime Rate, as applicable.
“ UCC ” means the Uniform Commercial Code as in effect from time to time in the State of New York provided , however , that if a term is defined in Article 9 of the Uniform Commercial Code differently than in another Article thereof, the term shall have the meaning set forth in Article 9; provided further that, if by reason of mandatory provisions of law, perfection, or the effect of perfection or non-perfection, of a security interest in any Collateral or the availability of any remedy hereunder is governed by the Uniform Commercial Code as in effect in a jurisdiction other than New York, “Uniform Commercial Code” means the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such perfection or effect of perfection or non-perfection or availability of such remedy, as the case may be.
“ Weighted Average Life to Maturity ” means, when applied to any Indebtedness at any date, the number of years obtained by dividing (1) the sum of the products obtained by multiplying (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.
“ 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 1 of Subtitle E of Title IV of ERISA.
“ Yield ” for any Term Loan on any date of determination will be the internal rate of return on such Term Loan determined by the Administrative Agent utilizing (a) the greater of (i) if applicable, any “LIBOR floor” applicable to such Term Loan on such date and (ii) the forward LIBOR curve (calculated on a quarterly basis) as calculated by the Administrative Agent in accordance with its customary practice during the period from such date to the Maturity Date of such Term Loan; (b) the Applicable Margin for such Term Loan on such date; and (c) the issue price of such Term Loan (after giving effect to any original issue discount or upfront fees paid to the market in respect of such Term Loan) (it being understood that the “issue price” of (x) the Term B Loans shall be 99.0% and (y) any Extended Term Loan shall be deemed to the issue price of the Term B Loan (as determined above) minus any upfront fees paid to the Lenders providing such Extended Term Loans).
SECTION 1.02 Terms Generally. With reference to this Agreement and each other Loan Document, unless otherwise specified herein or in such other Loan Document:
(a) 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, (i) any definition of or reference to any agreement, instrument or other document (including any Charter Document) shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth
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herein or in any other Loan Document), (ii) any reference herein to any Person shall be construed to include such Person’s successors and permitted assigns, (iii) the words “ herein ,” “ hereof ” and “ hereunder ,” and words of similar import when used in any Loan Document, shall be construed to refer to such Loan Document in its entirety and not to any particular provision thereof, (iv) all references in a Loan Document to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, the Loan Document in which such references appear, (v) any reference to any law shall include all statutory and regulatory provisions consolidating, amending replacing or interpreting such law and any reference to any law or regulation shall, unless otherwise specified, refer to such law or regulation as amended, modified or supplemented from time to time, (vi) 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, (vii) all references to “$” or “dollars” or to amounts of money and all calculations of permitted “baskets” and other similar matters shall be deemed to be references to the lawful currency of the United States of America, and (viii) references to “knowledge” of any Loan Party means the actual knowledge of a Responsible Officer.
(b) In the computation of periods of time from a specified date to a later specified date, the word “ from ” means “ from and including ”; the words “ to ” and “ until ” each mean “ to but excluding ”; and the word “ through ” means “ to and including .”
(c) Section headings herein and in the other Loan Documents are included for convenience of reference only and shall not affect the interpretation of this Agreement or any other Loan Document.
(d) This Agreement and the other Loan Documents are the result of negotiation among, and have been reviewed by counsel to, among others, the Loan Parties and the Administrative Agent and are the product of discussions and negotiations among all parties. Accordingly, this Agreement and the other Loan Documents are not intended to be construed against the Administrative Agent or any of the Lenders merely on account of the Administrative Agent’s or any Lender’s involvement in the preparation of such documents.
SECTION 1.03 Accounting Terms .
(a) Generally . All accounting terms not specifically or completely defined herein shall be construed in conformity with, and all financial data (including financial ratios and other financial calculations) required to be submitted pursuant to this Agreement shall be prepared in conformity with, GAAP applied on a consistent basis, as in effect from time to time, applied in a manner consistent with that used in preparing the audited financial statements described in SECTION 3.04, except as otherwise specifically prescribed herein. All amounts used for purposes of financial calculations required to be made shall be without duplication. Notwithstanding anything to the contrary herein, for purposes of determining compliance with any test or covenant contained in this Agreement with respect to any period during which any Specified Transaction occurs, the Consolidated Leverage Ratio and Consolidated Interest Coverage Ratio shall be calculated with respect to such period and such Specified Transaction on a Pro Forma Basis.
(b) Issues Related to GAAP . If at any time any change in GAAP would affect the computation of any financial ratio or requirement set forth in any Loan Document, and either the Borrower or the Required Lenders shall so request, the Administrative Agent, the Lenders and the Borrower shall negotiate in good faith to amend such ratio or requirement to preserve the original intent thereof in light of such change in GAAP (subject to the approval of the Required Lenders); provided that, until so amended, (i) such ratio or requirement shall continue to be computed in accordance with GAAP prior to such change therein and (ii) the Borrower shall provide to the Administrative Agent and the Lenders as reasonably requested hereunder a reconciliation between calculations of such ratio or requirement made before and after giving effect to such change in GAAP. In addition, the definitions set forth in the Loan Documents and any financial calculations required by the Loan Documents shall be computed to exclude (a) the effect of purchase accounting adjustments, including the effect of non-cash items resulting from any amortization, write-up, write-down or write-off of any assets or deferred charges (including without limitation intangible assets, goodwill and deferred financing costs in connection with the BCFWC Acquisition, any Permitted Acquisition or any merger, consolidation or other similar transaction permitted by this Agreement), (b) the application of ASC 815 (Derivatives and Hedging), ASC 480 (Distinguishing Liabilities from Equity) or ASC 718 (Stock
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Compensation) (to the extent the pronouncements in ASC 718 result in recording an equity award as a liability on the Consolidated balance sheet of BCF Holdings and its Subsidiaries in the circumstance where, but for the application of the pronouncements, such award would have been classified as equity), (c) any mark-to-market adjustments to any derivatives (including embedded derivatives contained in other debt or equity instruments under ASC 815), (d) any non-cash compensation charges resulting from the application of ASC 718 and (e) any change to lease accounting rules from those in effect pursuant to ASC 840 (Leases) and other related lease accounting guidance as in effect on the Closing Date.
Notwithstanding the foregoing, for purposes of determining compliance with any covenant (including the computation of any financial covenant) contained herein, the effects of FASB ASC 825 (Financial Instruments) and ASC 470-20 (Debt with Conversion and Other Options) on financial liabilities shall be disregarded.
SECTION 1.04 Rounding . Any financial ratios required to be maintained by the Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to one place more than the number of places by which such ratio is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).
SECTION 1.05 Times of Day . Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).
SECTION 1.06 Certifications . All certifications to be made hereunder by an officer or representative of a Loan Party shall be made by such person in his or her capacity solely as an officer or a representative of such Loan Party, on such Loan Party’s behalf and not in such person’s individual capacity.
ARTICLE II
Amount and Terms of Credit
SECTION 2.01 Commitment of the Lenders . Subject to the terms and conditions hereof, each Lender severally agrees to make a loan (a “ Term B Loan ”) to the Borrower on the Closing Date in an amount not to exceed the amount of the Commitment of such Lender. Any amount borrowed under this SECTION 2.01 and subsequently repaid or prepaid may not be reborrowed. Each Lender’s Commitment shall terminate immediately and without further action on the Closing Date after giving effect to the funding of such Lender’s Commitment. The Term B Loans may from time to time be LIBO Loans or Prime Rate Loans, as determined by the Borrower and notified to the Administrative Agent in accordance with SECTIONS 2.03 and 2.09.
SECTION 2.02 Reserved .
SECTION 2.03 Procedure for Term Loan Borrowing .
(a) The Borrower shall give the Administrative Agent irrevocable notice (which notice must be received by the Administrative Agent prior to 11:00 A.M., New York City time, one Business Day prior to the anticipated Closing Date) requesting that the Lenders make the Term B Loans on the Closing Date and specifying the amount to be borrowed and whether the Term B Loans will initially be LIBO Loans or Prime Rate Loans (and, if LIBO Loans, the Interest Period for such Loans). Upon receipt of such notice the Administrative Agent shall promptly notify each Lender thereof. Not later than 12:00 noon, New York City time, on the Closing Date each Lender shall make available to the Administrative Agent at the Funding Office an amount in immediately available funds equal to the Term B Loan to be made by such Lender. The Administrative Agent shall credit the account of the Borrower on the books of such office of the Administrative Agent with the aggregate of the amounts made available to the Administrative Agent by the Lenders in immediately available funds.
(b) Except as set forth in SECTION 2.09, SECTION 2.10 and SECTION 2.11, Term Loans shall be either Prime Rate Loans or LIBO Loans as the Borrower may request (which request shall substantially be made in the form attached hereto as Exhibit B-1 ) subject to and in accordance with this SECTION 2.03. Each Lender may fulfill its Commitment with respect to any Term B Loan by causing any lending office of such Lender to make such
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Term B Loan; provided , however , that any such use of a lending office shall not affect the obligation of the Borrower to repay such Term B Loan in accordance with the terms of the applicable Note. Each Lender shall, subject to its overall policy considerations, use reasonable efforts to select a lending office which will not result in the payment of increased costs by the Borrower. Subject to the other provisions of this SECTION 2.03 and the provisions of SECTION 2.11, Borrowings of Term Loans of more than one Type may be incurred at the same time, but in any event no more than ten (10) Borrowings of LIBO Loans may be outstanding at any time.
(c) The procedures for the funding of Incremental Term Loans shall be as set forth in the applicable Incremental Term Loan Amendment.
SECTION 2.04 Repayment of Term Loans .
(a) The principal amount of the Term B Loans shall be repaid in consecutive quarterly installments (each, an “ Installment ”) of 0.25% of the original aggregate principal amount thereof (to be decreased in accordance with SECTION 2.17(f) in the event of any mandatory prepayments of the Term Loans made hereunder), each on the last day of each Fiscal Quarter (each, an “ Installment Date ”) commencing on the first Installment Date after the Closing Date with the entire remaining unpaid balance due on the Maturity Date of the Term B Loans.
(b) The principal amount of each Incremental Term Loan of any Series shall amortize as provided in the applicable Incremental Term Loan Amendment.
(c) The principal amount of the Extended Term Loans of any Extension Series shall amortize as provided in the applicable Extended Term Loan Amendment (to be decreased in accordance with SECTION 2.17(f) in the event of any mandatory prepayments of such Extended Term Loan made hereunder or as directed by the Borrower in the event of any voluntary prepayments of the Term Loans hereunder).
Notwithstanding the foregoing, (x) the amounts required to be paid with respect to the Term Loans of any Class shall be reduced in connection with any prepayment of the Term Loans of such Class in accordance with SECTION 2.16 or 2.17, as applicable; and (y) the Term Loans of each Class, together with all other amounts owed hereunder with respect thereto, shall, in any event, be paid in full no later than the Maturity Date.
SECTION 2.05 Incremental Term Loans .
(a) The Borrower may by written notice to the Administrative Agent elect to request the establishment of one or more additional Classes of Term Loans denominated in Dollars under this Agreement (“ Incremental Term Loans ”). Each such notice shall specify the date (each, an “ Incremental Effective Date ”) on which the Borrower proposes that the Incremental Term Loans shall be made, which shall be a date not less than five Business Days after the date on which such notice is delivered to the Administrative Agent; provided that:
(i) before and after giving effect to the borrowing of such Incremental Term Loans on the Incremental Effective Date no Default shall have occurred and be continuing;
(ii) the Weighted Average Life to Maturity of such Incremental Term Loans shall not be shorter than the then remaining Weighted Average Life to Maturity of the Term B Loans outstanding at the time of such borrowing;
(iii) all other terms applicable to such Incremental Term Loans (other than provisions relating to original issue discount, upfront fees and interest rates, amortization (other than the Maturity Date and subject to clause (ii) above), optional prepayments or redemption terms, in each case, which shall be as agreed between the Borrower and the Incremental Term Lenders providing such Incremental Term Loans subject to the proviso contained in the definition of Applicable Margin), to the extent not consistent with or to the extent materially more onerous taken as a whole, than those terms applicable to the then outstanding Term B Loans except to the extent such covenants and other terms apply solely to any period after the latest Maturity Date of any Class of Term Loans outstanding on the Incremental Effective Date immediately prior
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to the borrowing of such Incremental Term Loans shall be reasonably satisfactory to the Administrative Agent and the Borrower;
(iv) the aggregate principal amount of Incremental Term Loans (other than Refinancing Term Loans) borrowed following the Closing Date, when aggregated with the principal amount of Qualifying Secured Debt issued pursuant to clause (w)(ii) of the definition of “Permitted Indebtedness,” would not exceed the Maximum Incremental Amount;
(v) on a Pro Forma Basis, (x) the Borrower would be in compliance with each of the Financial Performance Covenants for the most recently ended Fiscal Quarter for which financial statements have been or are then required to have been delivered and (y) the Consolidated Secured Leverage Ratio as of the last day of the most recently ended Fiscal Quarter for which financial statements have been or are then required to have been delivered would be less than or equal to 3.00 to 1.0; and
(vi) the Loan Parties and the Collateral Agent shall enter into such amendments to the Security Documents as may be reasonably requested by the Collateral Agent (which shall not require any consent from any Lender other than those consents provided pursuant to this Agreement) in order to ensure that the Incremental Term Loans are provided with the benefit of the applicable Security Documents and shall deliver such other documents, certificates and opinions of counsel in connection therewith as may be reasonably requested by the Collateral Agent.
(b) The Borrower may approach any Lender or any other Person that would be an Eligible Assignee to provide all or a portion of the Incremental Term Loans (a “ Incremental Term Lender ”); provided that any Lender offered or approached to provide all or a portion of the Incremental Term Loans may elect or decline, in its sole discretion, to provide an Incremental Term Loan. Any Incremental Term Loans made on any Refinancing Effective Date shall be designated a series (a “ Series ”) of Incremental Term Loans for all purposes of this Agreement; provided that, subject to the limitations set forth in clause (a) above, any Incremental Term Loans may, to the extent provided in the applicable Incremental Term Loan Amendment, be designated as an increase in any previously established Class of Term Loans.
(c) The Incremental Term Loans shall be established pursuant to an amendment to this Agreement among the Borrower, the Administrative Agent and the Incremental Term Lenders providing such Incremental Term Loans (an “ Incremental Term Loan Amendment ”) which shall be consistent with the provisions set forth in clause (a) above (but which shall not require the consent of any other Lender other than those consents provided pursuant this Agreement). Each Incremental Term Loan Amendment shall be binding on the Lenders, the Loan Parties and the other parties hereto.
SECTION 2.06 Extended Term Loans .
(a) The Borrower may at any time and from time to time request that all or a portion of the Term Loans of any Class (an “ Existing Term Loan Class ”) be converted to extend the scheduled maturity date(s) of any payment of principal with respect to all or a portion of any principal amount of such Term Loans (any such Term Loans which have been so converted, “ Extended Term Loans ”) and to provide for other terms consistent with this SECTION 2.06. In order to establish any Extended Term Loans, the Borrower shall provide a notice to the Administrative Agent (who shall provide a copy of such notice to each of the Lenders under the Existing Term Loan Class) (an “ Extension Request ”) setting forth the proposed terms of the Extended Term Loans to be established, which shall be consistent with the Term Loans under the Existing Term Loan Class from which such Extended Term Loans are to be converted except that:
(i) all or any of the scheduled amortization payments of principal of the Extended Term Loans may be delayed to later dates than the scheduled amortization payments of principal of the Term Loans of such Existing Term Loan Class to the extent provided in the applicable Term Loan Extension Amendment;
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(ii) the interest margins with respect to the Extended Term Loans may be different than the interest margins for the Term Loans of such Existing Term Loan Class and upfront fees may be paid to the Extending Term Lenders to the extent provided in the applicable Term Loan Extension Amendment;
(iii) the Term Loan Extension Amendment may provide for other covenants and terms that apply after the latest Maturity Date of any Class of Term Loans outstanding on the effective date of the Term Loan Extension Amendment immediately prior to the establishment of such Extended Term Loans; and
(iv) no Extended Term Loans may be optionally prepaid prior to the date on which the Term Loans under the Existing Term Loan Class from which they were converted are repaid in full unless such optional prepayment is accompanied by a pro rata optional prepayment of the Term Loans under such Existing Term Loan Class.
(b) Any Extended Term Loans converted pursuant to any Extension Request shall be designated a series (an “ Extension Series ”) of Extended Term Loans for all purposes of this Agreement; provided that, subject to the limitations set forth in clause (a) above, any Extended Term Loans converted from an Existing Term Loan Class may, to the extent provided in the applicable Term Loan Extension Amendment, be designated as an increase in any previously established Class of Term Loans.
(c) The Borrower shall provide the applicable Extension Request at least five (5) Business Days prior to the date on which Lenders under the applicable Existing Term Loan Class are requested to respond. No Lender shall have any obligation to agree to have any of its Term Loans of any Existing Term Loan Class converted into Extended Term Loans pursuant to any Extension Request. Any Lender wishing to have all or a portion of its Term Loans under the Existing Term Loan Class subject to such Extension Request (such Lender an “ Extending Term Lender ”) converted into Extended Term Loans shall notify the Administrative Agent (an “ Extension Election ”) on or prior to the date specified in such Extension Request of the amount of its Term Loans under the Existing Term Loan Class which it has elected to request be converted into Extended Term Loans (subject to any minimum denomination requirements reasonably imposed by the Administrative Agent and acceptable to the Borrower). In the event that the aggregate amount of Term Loans under the Existing Term Loan Class subject to Extension Elections exceeds the amount of Extended Term Loans requested pursuant to an Extension Request, Term Loans of the Existing Term Loan Class subject to Extension Elections shall be converted to Extended Term Loans on a pro rata basis based on the amount of Term Loans included in each such Extension Election.
(d) Extended Term Loans shall be established pursuant to an amendment (a “ Term Loan Extension Amendment ”) to this Agreement among the Borrower, the Administrative Agent and each Extending Term Lender providing an Extended Term Loan thereunder which shall be consistent with the provisions set forth in clause (a) above (but which shall not require the consent of any other Lender other than those consents provided pursuant to this Agreement). Each Term Loan Extension Amendment shall be binding on the Lenders, the Loan Parties and the other parties hereto. In connection with any Term Loan Extension Amendment, the Loan Parties and the Collateral Agent shall enter into such amendments to the Security Documents as may be reasonably requested by the Collateral Agent (which shall not require any consent from any Lender other than those consents provided pursuant to this Agreement) in order to ensure that the Extended Term Loans are provided with the benefit of the applicable Security Documents and shall deliver such other documents, certificates and opinions of counsel in connection therewith as may be reasonably requested by the Collateral Agent.
SECTION 2.07 Notes .
(a) Upon the request of any Lender, the Term Loans made by such Lender shall be evidenced by a Note duly executed on behalf of the Borrower.
(b) Each Lender is hereby authorized by the Borrower to endorse on a schedule attached to each Note delivered to such Lender (or on a continuation of such schedule attached to such Note and made a part thereof), or otherwise to record in such Lender’s internal records, an appropriate notation evidencing the date and amount of each Term Loan from such Lender, each payment and prepayment of principal of any such Term Loan, each payment of interest on any such Term Loan and the other information provided for on such schedule; provided ,
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howev er , that the failure of any Lender to make such a notation or any error therein shall not affect the obligation of the Borrower to repay the Term Loans made by such Lender in accordance with the terms of this Agreement and the applicable Notes.
(c) Upon receipt of an affidavit and indemnity of a Lender as to the loss, theft, destruction or mutilation of such Lender’s Note and upon cancellation of such Note, the Borrower will issue, in lieu thereof, a replacement Note in favor of such Lender, in the same principal amount thereof and otherwise of like tenor at such Lender’s expense.
SECTION 2.08 Interest on Term Loans .
(a) Subject to SECTION 2.12, each Prime Rate Loan of any Class shall bear interest (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days, as applicable) at a rate per annum that shall be equal to the then Prime Rate plus the Applicable Margin for Prime Rate Loans of such Class.
(b) Subject to SECTION 2.09 through SECTION 2.12, each LIBO Loan of any Class shall bear interest (computed on the basis of the actual number of days elapsed over a year of 360 days) at a rate per annum equal, during each Interest Period applicable thereto, to the Adjusted LIBO Rate for such Class for such Interest Period, plus the Applicable Margin for LIBO Loans of such Class.
(c) Accrued interest on all Term Loans shall be payable in arrears on each Interest Payment Date applicable thereto, at maturity (whether by acceleration or otherwise) and after such maturity on demand.
SECTION 2.09 Conversion and Continuation of Term Loans .
(a) The Borrower shall have the right at any time, on three (3) Business Days’ prior notice to the Administrative Agent (which notice shall be in the form of Exhibit B-2 hereto and to be effective, must be received by the Administrative Agent not later than 11:00 a.m. on the third Business Day preceding the date of any conversion), (i) to convert any outstanding Borrowings of Prime Rate Loans to Borrowings of LIBO Loans, or (ii) to continue an outstanding Borrowing of LIBO Loans for an additional Interest Period, or (iii) to convert any outstanding Borrowings of LIBO Loans to a Borrowing of Prime Rate Loans, subject in each case to the following:
(i) No Borrowing of Term Loans may be converted into, or continued as, LIBO Loans at any time when any Event of Default has occurred and is continuing (nothing contained herein being deemed to obligate the Borrower to incur Breakage Costs upon the occurrence and during the continuance of an Event of Default unless the Obligations are accelerated);
(ii) If less than a full Borrowing of Term Loans is converted, such conversion shall be made pro rata among the Lenders based upon the respective principal amounts of the Term Loans comprising such Borrowing held by such Lenders immediately prior to such conversion;
(iii) The aggregate principal amount of Prime Rate Loans being converted into or continued as LIBO Loans shall be in an integral of $1,000,000 and at least $5,000,000;
(iv) Each Lender shall effect each conversion by applying the proceeds of its new LIBO Loan or Prime Rate Loan, as the case may be, to its Term Loan being so converted;
(v) The Interest Period with respect to a Borrowing of LIBO Loans effected by a conversion or in respect to the Borrowing of LIBO Loans being continued as LIBO Loans shall commence on the date of conversion or the expiration of the current Interest Period applicable to such continuing Borrowing, as the case may be;
(vi) A Borrowing of LIBO Loans may be converted only on the last day of an Interest Period applicable thereto, unless the applicable Borrower pays all Breakage Costs incurred in connection with such conversion; and
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(vii) Each request for a conversion or continuation of a Borrowing of LIBO Loans which fails to state an applicable Interest Period shall be deemed to be a request for an Interest Period of one (1) month.
(b) If the Borrower does not give notice to convert any Borrowing of LIBO Loans, or does not give notice to continue, or does not have the right to continue, any Borrowing as LIBO Loans, in each case as provided in SECTION 2.09(a) above, such Borrowing shall automatically be converted to, or continued as, as applicable, a Borrowing of Prime Rate Loans, at the expiration of the then-current Interest Period. The Administrative Agent shall, after it receives notice from the Borrower, promptly give each Lender notice of any conversion, in whole or part, of any Term Loan made by such Lender.
SECTION 2.10 Alternate Rate of Interest for Term Loans . If prior to the commencement of any Interest Period for a LIBO Borrowing, the Administrative Agent:
(a) Reasonably determines (which determination shall be conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBO Rate (in accordance with the terms of the definition thereof) for such Interest Period; or
(b) Is advised by the Required Lenders that the Adjusted LIBO Rate for such Interest Period will not adequately and fairly reflect the cost to such Required Lenders of making or maintaining their Term Loans 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 applicable Lenders that the circumstances giving rise to such notice no longer exist (which notice the Administrative Agent shall deliver promptly upon obtaining knowledge of the same), (i) any Borrowing Request that requests the conversion of any Borrowing to, or continuation of any Borrowing as, a LIBO Borrowing shall be ineffective and (ii) if any Borrowing Request requests a LIBO Borrowing, such Borrowing shall be made as a Borrowing of Prime Rate Loans unless withdrawn by the Borrower.
SECTION 2.11 Change in Legality .
(a) Notwithstanding anything to the contrary contained elsewhere in this Agreement, if any Change in Law occurring after the Closing Date shall make it unlawful for a Lender to make or maintain a LIBO Loan or to give effect to its obligations as contemplated hereby with respect to a LIBO Loan, then, by written notice to the Borrower, such Lender may (x) declare that LIBO Loans will not thereafter be made by such Lender hereunder, whereupon any request by the Borrower for a LIBO Borrowing shall, as to such Lender only, be deemed a request for a Prime Rate Loan unless such declaration shall be subsequently withdrawn; and (y) require that all outstanding LIBO Loans made by such Lender be converted to Prime Rate Loans, in which event all such LIBO Loans shall be automatically converted to Prime Rate Loans as of the effective date of such notice as provided in SECTION 2.09(b). In the event any Lender shall exercise its rights hereunder, all payments and prepayments of principal which would otherwise have been applied to repay the LIBO Loans that would have been made by such Lender or the converted LIBO Loans of such Lender, shall instead be applied to repay the Prime Rate Loans made by such Lender in lieu of, or resulting from the conversion of, such LIBO Loans.
(b) For purposes of this SECTION 2.11, a notice to the Borrower pursuant to SECTION 2.11(a) above shall be effective, if lawful, and if any LIBO Loans shall then be outstanding, on the last day of the then-current Interest Period; and otherwise such notice shall be effective on the date of receipt by the Borrower.
SECTION 2.12 Default Interest . After the occurrence of any Event of Default pursuant to SECTION 7.01(a) or SECTION 7.01(b) and at all times thereafter while such Event of Default is continuing, interest shall accrue on all Term Loans and other amounts owing by the Borrowers (after as well as before judgment, as and to the extent permitted by law) at a rate per annum (computed on the basis of the actual number of days elapsed over a year of 365 or 366 days as applicable) (the “ Default Rate ”) equal to the rate (including the Applicable Margin) in effect from time to time plus two percent (2.00%) per annum and such interest shall be payable on demand.
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SECTION 2.13 Reserved .
SECTION 2.14 Increased Costs .
(a) If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Lender or any holding company of any Lender (except any such reserve requirement reflected in the Adjusted LIBO Rate); or
(ii) subject any Credit Party or any Loan Party to any Tax of any kind whatsoever with respect to LIBO Loans under this Agreement (except for Indemnified Taxes or Other Taxes covered by Section 2.23 (for the avoidance of doubt, no duplication of the Borrower’s obligation under Section 2.23 with respect to Indemnified Taxes or other Taxes is intended under this clause (ii)) and the imposition of, or any change in the rate of, any Excluded Tax payable by such Credit or Loan Party); or
(iii) impose on any Lender or the London interbank market any other condition affecting LIBO Loans made by such Lender;
and the result of any of the foregoing shall be to increase the cost in any material amount in excess of those incurred by similarly situated lenders to such Lender of making or maintaining any LIBO Loan or to increase the cost in any material amount in excess of those incurred by similarly situated lenders to such Lender or to reduce the amount in any material respect 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 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 Term Loans made by, such Lender, to a level below that which such Lender or such Lender’s holding company would 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 Lender or its holding company as specified in paragraph (a) or (b) of this SECTION 2.14 and setting forth in reasonable detail the manner in which such amount or amounts were determined 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 fifteen (15) Business Days after receipt thereof.
(d) Failure or delay on the part of any Lender to demand compensation pursuant to this SECTION 2.14 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 90 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, and provided further that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the 90 day period referred to above shall be extended to include the period of retroactive effect thereof.
SECTION 2.15 Reserved .
SECTION 2.16 Optional Prepayment of Term Loans; Reimbursement of Lenders .
(a) The Borrower shall have the right at any time and from time to time to prepay without premium (except as provided in SECTION 2.19(d)) or penalty (but subject to payment of Breakage Costs as provided herein) outstanding Term Loans of any Class in whole or in part, (x) with respect to LIBO Loans, upon at least two (2)
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Business Days’ prior written, telex or facsimile notice to the Administrative Agent, prior to 12:00 noon, and (y) with respect to Prime Rate Loans, on the same Business Day if written, telex or facsimile notice is received by the Administrative Agent prior to 12:00 noon, subject in each case to the following limitations:
(i) No prepayment of any Extended Term Loans of any Extension Series shall be permitted pursuant to this SECTION 2.16 so long as any Term Loans of any Existing Term Loan Class from which such Extended Term Loans were converted remain outstanding unless such prepayment is accompanied by a pro rata (or greater proportionate) prepayment of Term Loans of such Existing Term Loan Class;
(ii) All prepayments shall be applied to reduce scheduled remaining installments on the applicable Term Loans as directed by the Borrower;
(iii) Subject to the foregoing, outstanding Prime Rate Loans of any Class shall be prepaid before outstanding LIBO Loans of such Class are prepaid (except as otherwise directed by the Borrower). Each partial prepayment of LIBO Loans shall be in an integral multiple of $1,000,000 (but in no event less than $10,000,000). No prepayment of LIBO Loans of any Class shall be permitted pursuant to this SECTION 2.16 other than on the last day of an Interest Period applicable thereto, unless the Borrower reimburses the Lenders for all Breakage Costs associated therewith within five (5) Business Days of receiving a written demand for such reimbursement which sets forth the calculation of such Breakage Costs in reasonable detail. No partial prepayment of a Borrowing of LIBO Loans shall result in the aggregate principal amount of the LIBO Loans remaining outstanding pursuant to such Borrowing being less than $5,000,000 (unless all such outstanding LIBO Loans are being prepaid in full); and
(iv) Each notice of prepayment shall specify the prepayment date, the principal amount, Type and Class of Term Loans to be prepaid and, in the case of LIBO Loans, the Borrowing or Borrowings pursuant to which such Term Loans were made. Each notice of prepayment shall be revocable, provided that, within five (5) Business Days of receiving a written demand for such reimbursement which sets forth the calculation of such Breakage Costs in reasonable detail, the Borrower shall reimburse the Lenders for all Breakage Costs associated with the revocation of any notice of prepayment. The Administrative Agent shall, promptly after receiving notice from the Borrower hereunder, notify each applicable Lender of the principal amount, Type and Class of Term Loans held by such Lender which are to be prepaid, the prepayment date and the manner of application of the prepayment.
(b) The Borrower shall reimburse each Lender as set forth below for any loss incurred or to be incurred by the Lenders in the reemployment of the funds resulting from any prepayment (for any reason whatsoever, including, without limitation, conversion to Prime Rate Loans or acceleration by virtue of, and after, the occurrence and during the continuance of an Event of Default) of any LIBO Loan required or permitted under this Agreement, if such LIBO Loan is prepaid other than on the last day of the Interest Period for such LIBO Loan. Such loss shall be the amount (herein, collectively, “ Breakage Costs ”) as reasonably determined by such Lender as the excess, if any, of (A) the amount of interest which would have accrued to such Lender on the amount so paid, not prepaid or not borrowed at a rate of interest equal to the Adjusted LIBO Rate for such LIBO Loan (but specifically excluding any Applicable Margin), for the period from the date of such payment or failure to borrow or failure to prepay to the last day (x) in the case of a payment or refinancing of a LIBO Loan with Prime Rate Loans other than on the last day of the Interest Period for such LIBO Loan or the failure to prepay a LIBO Loan, of the then current Interest Period for such LIBO Loan or (y) in the case of such failure to borrow, of the Interest Period for such LIBO Loan which would have commenced on the date of such failure to borrow, over (B) the amount of interest which would have accrued to such Lender on such amount by placing such amount on deposit for a comparable period with leading banks in the London interbank market. Any Lender demanding reimbursement for such loss shall deliver to the Borrower from time to time one or more certificates setting forth the amount of such loss as determined by such Lender and setting forth in reasonable detail the manner in which such amount was determined and such amounts shall be due within ten (10) Business Days after the receipt of such notice.
(c) Whenever any partial prepayment of Term Loans are to be applied to LIBO Loans of any Class, such LIBO Loans shall be prepaid in the chronological order of their Interest Payment Dates or as the Borrower may otherwise designate in writing.
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(d) (i) Notwithstanding anything to the contrary in SECTION 2.16 (which provisions shall not be applicable to this SECTION 2.16(d)), the Borrower shall have the right at any time and from time to time to prepay Term Loans of any Class from Lenders electing to participate in such prepayments at a discount to the par value of such Loans and on a non-pro rata basis (each, a “ Discounted Voluntary Prepayment ”) pursuant to the procedures described in this SECTION 2.16(d); provided that (A) no Discounted Voluntary Prepayment shall be made unless (A) immediately after giving effect to such Discounted Voluntary Prepayment, (i) no Default or Event of Default has occurred and is continuing, (ii) the Borrower is in compliance on a Pro Forma Basis with the Financial Performance Covenants as of the most recently completed Fiscal Quarter and (iii) the Borrower shall have Excess Availability (as defined in the ABL Facility) plus unrestricted cash and cash equivalents of at least $150,000,000, (B) any Discounted Voluntary Prepayment shall be offered to all Lenders with Term Loans of such Class on a pro rata basis and (C) the Borrower on the date such Discounted Voluntary Prepayment is made, shall deliver to the Administrative Agent a certificate of a Responsible Officer of the Borrower stating (1) that no Default or Event of Default has occurred and is continuing or would result from the Discounted Voluntary Prepayment (after giving effect to any related waivers or amendments obtained in connection with such Discounted Voluntary Prepayment), (2) that each of the conditions to such Discounted Voluntary Prepayment contained in this SECTION 2.16(d) has been satisfied or waived, (3) the aggregate principal amount of Term Loans so prepaid pursuant to such Discounted Voluntary Prepayment and (4) neither the Borrower nor any of its Affiliates has any MNPI.
(ii) To the extent the Borrower seeks to make a Discounted Voluntary Prepayment, the Borrower will provide written notice to the Administrative Agent substantially in the form of Exhibit H hereto (each, a “ Discounted Prepayment Option Notice ”) that the Borrower desires to prepay Term Loans in an aggregate principal amount specified therein by the Borrower (each, a “ Proposed Discounted Prepayment Amount ”), in each case at a discount to the par value of such Term Loans as specified below. The Proposed Discounted Prepayment Amount of Term Loans shall not be less than $10,000,000. The Discounted Prepayment Option Notice shall further specify with respect to the proposed Discounted Voluntary Prepayment: (A) the Proposed Discounted Prepayment Amount for Term Loans and the Class of Term Loans to which such offer relates, (B) a discount range (which may be a single percentage) selected by the Borrower with respect to such proposed Discounted Voluntary Prepayment equal to a percentage of par of the principal amount of such Term Loans (the “ Discount Range ”) and (C) the date by which Lenders are required to indicate their election to participate in such proposed Discounted Voluntary Prepayment which shall be at least five Business Days following the date of the Discounted Prepayment Option Notice (the “ Acceptance Date ”).
(iii) Upon receipt of a Discounted Prepayment Option Notice in accordance with SECTION 2.16(d)(ii), the Administrative Agent shall promptly notify each applicable Lender thereof. On or prior to the Acceptance Date, each Lender with Term Loans of the applicable Class may specify by written notice substantially in the form of Exhibit I hereto (each, a “ Lender Participation Notice ”) to the Administrative Agent (A) a maximum discount to par (the “ Acceptable Discount ”) within the Discount Range (for example, a Lender specifying a discount to par of 20% would accept a prepayment price of 80% of the par value of the Term Loans to be prepaid) and (B) a maximum principal amount (subject to rounding requirements specified by the Administrative Agent) of Term Loans of the applicable Class held by such Lender with respect to which such Lender is willing to permit a Discounted Voluntary Prepayment at the Acceptable Discount (“ Offered Loans ”). Based on the Acceptable Discounts and principal amounts of Term Loans of the applicable Class specified by the Lenders in Lender Participation Notices, the Administrative Agent, in consultation with the Borrower, shall calculate the applicable discount for Term Loans (the “ Applicable Discount ”), which Applicable Discount shall be (A) the percentage specified by the Borrower if the Borrower has selected a single percentage pursuant to SECTION 2.16(d)(ii) for the Discounted Voluntary Prepayment or (B) otherwise, the highest Acceptable Discount at which the Borrower can pay the Proposed Discounted Prepayment Amount in full (determined by adding the principal amounts of Offered Loans commencing with the Offered Loans with the highest Acceptable Discount); provided , however , that in the event that such Proposed Discounted Prepayment Amount cannot be repaid in full at any Acceptable Discount, the Applicable Discount shall be the lowest Acceptable Discount specified by the Lenders that is within the Discount Range. The Applicable Discount shall be applicable for all Lenders who have offered to participate in the Discounted Voluntary Prepayment and have Qualifying Loans (as defined below). Any Lender with outstanding Term Loans under the applicable Class whose Lender Participation Notice is not received by the Administrative Agent by the Acceptance Date shall be deemed to have declined to accept a Discounted Voluntary Prepayment of any of its Term Loans at any discount to their par value within the Applicable Discount.
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(iv) The Borrower shall make a Discounted Voluntary Prepayment by prepaying those Term Loans (or the respective portions thereof) offered by the Lenders (“ Qualifying Lenders ”) that specify an Acceptable Discount that is equal to or greater than the Applicable Discount (“ Qualifying Loans ”) at the Applicable Discount; provided that if the aggregate proceeds required to prepay all Qualifying Loans (disregarding any interest payable at such time) would exceed the amount of aggregate proceeds required to prepay the Proposed Discounted Prepayment Amount, such amounts in each case calculated by applying the Applicable Discount, the Borrower shall prepay such Qualifying Loans ratably among the Qualifying Lenders based on their respective principal amounts of such Qualifying Loans (subject to rounding requirements specified by the Administrative Agent). If the aggregate proceeds required to prepay all Qualifying Loans (disregarding any interest payable at such time) would be less than the amount of aggregate proceeds required to prepay the Proposed Discounted Prepayment Amount, such amounts in each case calculated by applying the Applicable Discount, the Borrower shall prepay all Qualifying Loans.
(v) Each Discounted Voluntary Prepayment shall be made within five Business Days of the Acceptance Date, without premium or penalty (and without Breakage Costs), upon irrevocable notice substantially in the form of Exhibit J hereto (each a “ Discounted Voluntary Prepayment Notice ”), delivered to the Administrative Agent no later than 1:00 P.M. New York City time, two Business Days prior to the date of such Discounted Voluntary Prepayment, which notice shall specify the date and amount of the Discounted Voluntary Prepayment and the Applicable Discount determined by the Administrative Agent. Upon receipt of any Discounted Voluntary Prepayment Notice the Administrative Agent shall promptly notify each relevant Lender thereof. If any Discounted Voluntary Prepayment Notice is given, the amount specified in such notice shall be due and payable to the applicable Lenders, subject to the Applicable Discount on the applicable Term Loans, on the date specified therein together with accrued interest (on the par principal amount) to, but not including, such date on the amount prepaid.
(vi) To the extent not expressly provided for herein, each Discounted Voluntary Prepayment shall be consummated pursuant to reasonable procedures (including as to timing, rounding, minimum amounts, Type and Interest Periods and calculation of Applicable Discount in accordance with SECTION 2.16(d)(iii) above) reasonably established by the Administrative Agent and the Borrower.
(vii) Prior to the delivery of a Discounted Voluntary Prepayment Notice, upon written notice to the Administrative Agent, the Borrower may withdraw its offer to make a Discounted Voluntary Prepayment pursuant to any Discounted Prepayment Option Notice.
(viii) To the extent the Term Loans of any Class are prepaid pursuant to this SECTION 2.16(d), scheduled amortization amounts for the Term Loans of such Class under SECTION 2.04 shall be reduced on a pro rata basis by the principal amount of the Term Loans so prepaid.
SECTION 2.17 Mandatory Prepayment . The outstanding Obligations shall be subject to prepayment as follows:
(a) If on any date any Loan Party shall have received Net Proceeds from any sale, transfer or other disposition (including pursuant to a sale and leaseback transaction) of any Collateral (other than the sale of Collateral (other than Real Estate, Capital Stock and Intellectual Property) in the ordinary course of business and the transfer of any Collateral among Stores and other locations of the Loan Parties), to the extent that such Net Proceeds are not required to be applied to the payment of obligations of the Borrower or other borrowers under the ABL Facility, an amount equal to 100% of such Net Proceeds shall be applied within five Business Days after such date toward the prepayment of Term Loans as set forth in SECTION 2.17(f) unless, provided that no Event of Default has occurred and is continuing, (i) the proceeds therefrom are (a) utilized for purposes of replacing or repairing the assets in respect of which such proceeds were received or reinvesting in assets used in any of the Loan Parties’ business within twelve (12) months of the receipt of such proceeds (or, in the case of any disposition of Real Estate the proceeds of which will be used to reinvest in Real Estate, within eighteen (18) months of receipt of such proceeds if a letter of intent or other binding commitment to reinvest such proceeds is entered into within twelve (12) months of receipt of such proceeds) or (b) in the case of any disposition of Real Estate listed on Schedule 1.1(b) , reinvested in additional Real Estate within twelve (12) months of the receipt of such proceeds or within eighteen (18) months of receipt of such proceeds if a letter of intent or other binding commitment to reinvest such proceeds is entered into within twelve (12) months of receipt of such proceeds and (ii) the aggregate
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amount at any time of such reinvested proceeds (A) in the case of any such sale, transfer or other disposition of any such Collateral pursuant to a sale and leaseback transaction, is equal to or less than $10,000,000 and (B) in the case of any such sale, transfer or other disposition of such Collateral (other than pursuant to a sale and leaseback transaction and other than a disposition of Real Estate the proceeds of which will be used to reinvest in Real Estate) is equal to or less than $10,000,000; or
(b) If on any date any Loan Party shall have received Net Proceeds from any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation, expropriation or similar proceeding of, any Collateral of a Loan Party, to the extent that such Net Proceeds are not required to be applied to the payment of obligations of the Borrower or other borrowers under the ABL Facility, an amount equal to 100% of such Net Proceeds shall be applied within five Business Days after such date toward the prepayment of Term Loans as set forth in SECTION 2.17(f) unless (i) the proceeds therefrom are required to be paid to the holder of a Lien on such property or asset having priority over the Lien of the Collateral Agent, or (ii) the proceeds therefrom are utilized for purposes of replacing or repairing the assets in respect of which such proceeds, awards or payments were received or reinvesting in assets used in any of the Loan Parties’ business within twelve (12) months of the receipt of such proceeds;
(c) If on any date any Loan Party shall have received Net Proceeds (i) from any Refinancing Term Loans or Indebtedness pursuant to clause (w)(i) of the definition of “Permitted Indebtedness” or (ii) from the incurrence of any Indebtedness of the Borrower or any of its Subsidiaries (other than Permitted Indebtedness), an amount equal to 100% of such Net Proceeds shall be applied within five Business Days after such date toward the prepayment of Term Loans as set forth in SECTION 2.17(f); and
(d) If, for any Fiscal Year of the Borrower commencing with the Fiscal Year ending January 28, 2012, there shall be Excess Cash Flow, the Borrower shall, on the relevant Excess Cash Flow Application Date (as defined below), apply an amount, if positive, equal to the excess of (i) the ECF Percentage of such Excess Cash Flow minus (ii) the principal amount of Term Loans optionally prepaid pursuant to Section 2.16 during such Fiscal Year toward the prepayment of the Term Loans as set forth in SECTION 2.17(f). Each such prepayment shall be made on a date (an “ Excess Cash Flow Application Date ”) no later than five Business Days after the date on which financial statements of the Borrower have been delivered pursuant to SECTION 5.01(a).
(e) Reserved.
(f) Any prepayment of any Term Loans pursuant to SECTIONS 2.17(a) through (d) above shall be applied to repay Term Loans of each then outstanding Class, provided , that any prepayment of any Term Loans pursuant to SECTION 2.17(c) shall be applied to repay Term Loans of each Class with an earlier Maturity Date prior to being applied to repay any Term Loans of any other Class with a later Maturity Date (and, if two Classes of Term Loans have the same Maturity Date, shall be applied on a pro rata basis to such Classes). Any prepayment of any Class of Term Loans in accordance with the foregoing shall be applied first, to the remaining scheduled installments of principal of such Term Loans pursuant to SECTION 2.04 that are due within 24 months of such prepayment and thereafter to the remaining scheduled installments of principal of the Term Loans of such Class on a pro rata basis. Subject to the foregoing, outstanding Prime Rate Loans of any Class shall be prepaid before outstanding LIBO Loans of such Class are prepaid. No prepayment of LIBO Loans of any Class shall be permitted pursuant to this SECTION 2.17 until the last day of an Interest Period applicable thereto, unless the Borrower reimburses the Lenders for all Breakage Costs associated therewith within five (5) Business Days of receiving a written demand for such reimbursement which sets forth the calculation of such Breakage Costs in reasonable detail. In order to avoid such Breakage Costs, as long as no Specified Default has occurred and is continuing, at the request of the Borrower, the Administrative Agent shall hold all amounts required to be applied to LIBO Loans of a particular Class in a Cash Collateral Account and will apply such funds to the applicable LIBO Loans of such Class at the end of the then pending Interest Period therefor ( provided that the foregoing shall in no way limit or restrict the Agents’ rights upon the occurrence and during the continuance of any other Event of Default).
SECTION 2.18 Reserved .
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SECTION 2.19 Fees .
(a) The Borrower shall pay to the Agents, for their respective accounts, (i) the fees set forth in the Fee Letter as and when payment of such fees is due as therein set forth and (ii) such other fees in the amounts and at the times separately agreed upon between the Borrower and the Agents.
(b) All fees shall be paid on the dates due, in immediately available funds, to the Administrative Agent for the account of the Administrative Agent and other Credit Parties as provided herein. Once due, all fees shall be fully earned and shall not be refundable under any circumstances (except to the extent set forth in the Fee Letter).
(c) The Borrower shall pay to each Lender on the Closing Date an upfront fee equal to 1.00% of the Term B Loan made by such Lender on the Closing Date (which fee may be netted by each Lender from the proceeds of its Term B Loan made to the Borrower); and
(d) In the event that, at any time on or prior to the first anniversary of the Closing Date, the Borrower makes any voluntary prepayment of all of the Term B Loans with the proceeds of any term loan Indebtedness under any credit facility (other than pursuant to a Discounted Prepayment Offer or with the proceeds from any public offering or other issuance of BCF Holdings’ or the Parent’s Capital Stock), which term loan Indebtedness has a lower Yield than the Yield of the Term B Loans, then, the Borrower agrees to pay to the Administrative Agent, for the account of each Term B Lender a fee in an amount equal to 1.00% of such Lender’s Term B Loans prepaid with the proceeds of such term loan Indebtedness.
SECTION 2.20 Maintenance of Loan Account; Statements of Account . The Administrative Agent shall maintain an account on its books in the name of the Borrower (each, the “ Loan Account ”) which will reflect (i) all Term Loans of each Class made by the Lenders to the Borrower or for the Borrower’s account and (ii) any and all other monetary Obligations that have become payable. The Loan Account will be credited with all amounts received by the Administrative Agent from the Borrower or from other Persons for the Borrower’s account, and the amounts so credited shall be applied as set forth in and to the extent required by SECTIONS 2.17(f) or 7.03, as applicable.
SECTION 2.21 Payments .
(a) The Borrower shall make each payment required to be made hereunder or under any other Loan Document (whether of principal, interest, fees, amounts payable under SECTIONS 2.14, 2.16(b) or 2.23, or otherwise) prior to 2:00 p.m. on the date when due, in immediately available funds, without setoff or counterclaim. Any amounts received after such time on any date 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 thereon. All such payments shall be made to the Administrative Agent at its Funding Office, except that payments pursuant to SECTIONS 2.14, 2.16(b), 2.23 and 9.03 shall be made directly to the Persons entitled thereto and payments pursuant to other Loan Documents shall be made to the Persons specified therein. The Administrative Agent shall distribute any such payments to the appropriate recipient promptly following receipt thereof. If any payment under any Loan Document shall be due on a day that is not a Business Day, except with respect to LIBO Borrowings, the date for payment shall be extended to the next succeeding Business Day, and, if any payment due with respect to LIBO Borrowings shall be due on a day that is not a Business Day, the date for payment shall be extended to the next succeeding Business Day, unless that succeeding Business Day is in the next calendar month, in which event, the date of such payment shall be on the last Business Day of subject calendar month, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension.
(b) Except as specifically provided herein all funds received by and available to the Administrative Agent to pay principal, interest, fees and other amounts then due hereunder, shall be applied in accordance with the provisions of SECTIONS 2.17(f) or 7.03 ratably among the parties entitled thereto in accordance with the amounts of principal, interest, fees and other amounts then due to such respective parties.
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(c) Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders hereunder that the Borrower will not make such payment, the Administrative Agent may assume that the Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders the amount due. In such event, if the Borrower has not in fact made such payment, then each of the Lenders severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender with interest thereon for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the Federal Funds Effective Rate.
SECTION 2.22 Reserved .
SECTION 2.23 Taxes .
(a) Any and all payments by or on account of any obligation of the Loan Parties hereunder or under any other Loan Document shall be made free and clear of and without deduction for any Indemnified Taxes or Other Taxes; provided , however , that if any applicable withholding agent shall be required to deduct or remit any such Taxes from such payments, then (i) in the case of any Indemnified Taxes or Other Taxes, the sum payable shall be increased as necessary so that after making all required deductions or remittances for such Taxes (including deductions applicable to additional sums payable under this SECTION 2.23) the applicable Credit Party 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 Law.
(b) In addition, the Loan Parties shall pay any Other Taxes to the relevant Governmental Authority in accordance with Applicable Law.
(c) The Borrower shall indemnify each Credit Party, within ten (10) days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid or payable by such Credit Party on or with respect to any payment by or on account of any obligation of the Loan Parties hereunder or under any other Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this SECTION 2.23) and any penalties, interest and reasonable expenses arising therefrom or with respect thereto to the extent not already paid by the Loan Parties pursuant to SECTION 2.23(a); provided that if the Borrower reasonably believes that such Taxes were not correctly or legally asserted, each Lender will use reasonable efforts to cooperate with the Borrower to obtain a refund of such taxes so long as such efforts would not, in the sole determination of such Lender, result in any additional costs, expenses or risks or be otherwise disadvantageous to it; provided further , that the Borrower shall not be required to compensate any Lender pursuant to this SECTION 2.23 for any penalties and interest incurred in any Fiscal Year for which such Lender is claiming compensation if such Lender does not furnish notice of such claim within six (6) months from the end of such Fiscal Year; provided further , that if the circumstances giving rise to such claim have a retroactive effect, then the beginning of such six month period shall be extended to include such period of retroactive effect. A certificate as to the amount of such payment or liability delivered to the Borrower by a Credit Party, or by the Administrative Agent on its own behalf or on behalf of any other Credit Party, setting forth in reasonable detail the manner in which such amount was determined, shall be conclusive absent manifest error.
(d) As soon as practicable after any payment of Indemnified Taxes or Other Taxes by a Loan Party to a Governmental Authority, the Borrower shall deliver to the Administrative Agent the original or 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) Each Lender shall (x) prior to the date hereof in the case of each Lender that is a signatory hereto (or the date of Assignment and Acceptance in the case of a Person that becomes a Lender after the date hereof) and (y) at such times as are reasonably requested by the Borrower or the Administrative Agent, provide the Borrower and the Administrative Agent with any documentation prescribed by law, or reasonably requested by the Borrower or the Administrative Agent, certifying as to any entitlement of such Lender to an exemption from, or reduction in, withholding tax with respect to any payments to be made to such Lender under the Loan Documents. Unless the applicable withholding agent has received forms or other documents satisfactory to it indicating that payments under
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any Loan Document to or for a Lender are not subject to withholding tax or are subject to such tax at a rate reduced by an applicable tax treaty, the Borrower, Administrative Agent or other applicable withholding agent shall withhold amounts required to be withheld by applicable law from such payments at the applicable statutory rate.
Without limiting the generality of the foregoing:
(i) Each Lender that is a U.S. Person within the meaning of Section 7701(a)(3) of the Code (a “ Domestic Lender ”) shall deliver to the Borrower and the Administrative Agent on or before the date on which it becomes a party to this Agreement two properly completed and duly signed original copies of Internal Revenue Service Form W-9 (or any successor form) certifying that such Lender is exempt from U.S. federal backup withholding.
(ii) Each Foreign Lender shall deliver to the Borrower and the Administrative Agent on or before the date on which it becomes a party to this Agreement (and from time to time thereafter when required by law or upon the reasonable request of the Borrower or the Administrative Agent) whichever of the following is applicable:
(A) two duly completed and executed original copies of Internal Revenue Service Form W-8BEN (or any successor forms) claiming eligibility for benefits of an income tax treaty to which the United States of America is a party;
(B) two duly completed and executed original copies of Internal Revenue Service Form W-8ECI (or any successor forms);
(C) in the case of a Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate, in substantially the form of Exhibit L-1 , or any other form approved by the Administrative Agent and the Borrower, to the effect that such 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 in connection with the Loan Documents are effectively connected with such Lender’s conduct of a U.S. trade or business and (y) two duly completed and executed original copies of Internal Revenue Service Form W-8BEN (or any successor form);
(D) to the extent a Foreign Lender is not the beneficial owner (for example, where the Foreign Lender is a partnership, or is a Participant holding a participation granted by a participating Lender), Internal Revenue Service Form W-8IMY (or any successor forms) of the Lender, accompanied by a Form W-8ECI, W-8BEN, certificate in substantially the form of Exhibit L-2 , L-3 or L-4 (as applicable), Form W-9, Form W-8IMY (or other successor forms) or any other required information from each beneficial owner, as applicable ( provided that, if the Lender is a partnership (and not a participating Lender) and one or more beneficial owners are claiming the portfolio interest exemption, a certificate in substantially the form of Exhibit L-2 shall be provided by such Lender on behalf of such beneficial owner(s)); or
(E) any other form prescribed by applicable requirements of U.S. federal income tax law as a basis for claiming exemption from or a reduction in U.S. federal withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable requirements of law to permit the Borrower and the Administrative Agent to determine the withholding or deduction required to be made.
Each Lender shall, from time to time after the initial delivery by such Lender of the forms described above, whenever a lapse in time or change in such Lender’s circumstances renders such forms, certificates or other evidence so delivered obsolete or inaccurate, promptly (1) deliver to the Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) renewals, amendments or additional or successor forms, properly completed and duly executed by such Lender, together with any other certificate or statement of
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exemption required in order to confirm or establish such Lender’s status or that such Lender is entitled to an exemption from or reduction in U.S. federal withholding tax or (2) notify Administrative Agent and the Borrower of its inability to deliver any such forms, certificates or other evidence.
Notwithstanding any other provision of this clause (e), a Lender shall not be required to deliver any form that such Lender is not legally eligible to deliver.
(f) Any Foreign Lender that is entitled to an exemption from or reduction in United States withholding tax shall deliver to the Borrower and the Administrative Agent two (2) copies of (i) either United States Internal Revenue Service Form W-8BEN (claiming a treaty benefit) or Form W-8ECI, or any subsequent versions thereof or successors thereto, or, (ii) in the case of a Foreign Lender claiming exemption from or reduction in U.S. Federal withholding tax under Section 871(h) or 881(c) of the Code with respect to payments of “portfolio interest,” a (A) Form W-8BEN, or any subsequent versions thereof or successors thereto and (B) a certificate representing that such Foreign Lender (1) is not a bank for purposes of Section 881(c) of the Code, (2) is not a 10 percent shareholder (within the meaning of Section 871(h)(3)(B) of the Code) of any Loan Party and (3) is not a controlled foreign corporation related to the Loan Parties (within the meaning of Section 864(d)(4) of the Code)), in all cases, properly completed and duly executed by such Foreign Lender claiming, as applicable, complete exemption from or reduced rate of, U.S. Federal withholding tax on payments by the Loan Parties under this Agreement and the other Loan Documents, or in the case of a Foreign Lender claiming exemption for “portfolio interest” certifying that it is not a foreign corporation, partnership, estate or trust. Such forms shall be delivered by each Foreign Lender on or before the date it becomes a party to this Agreement (or, in the case of a transferee that is a participation holder, on or before the date such participation holder becomes a transferee hereunder) and on or before the date, if any, such Foreign Lender changes its applicable lending office by designating a different lending office (a “ New Lending Office ”). In addition, each Foreign Lender shall deliver such forms promptly upon the obsolescence or invalidity of any form previously delivered by such Foreign Lender. Notwithstanding any other provision of this SECTION 2.23(f), a Foreign Lender shall not be required to deliver any form pursuant to this SECTION 2.23(f) that such Foreign Lender is not legally able to deliver.
(g) The Borrower shall not be required to indemnify any Foreign Lender or to pay any additional amounts to any Foreign Lender in respect of U.S. Federal withholding tax pursuant to paragraph (a) or (c) above to the extent that the obligation to pay such additional amounts would not have arisen but for a failure by such Foreign Lender to comply with the provisions of paragraph (e) above. Should a Lender become subject to Taxes because of its failure to deliver a form required hereunder, the Loan Parties shall, at such Lender’s expense, take such steps as such Lender shall reasonably request to assist such Lender to recover such Taxes.
(h) If any Loan Party shall be required pursuant to this SECTION 2.23 to pay any additional amount to, or to indemnify, any Credit Party to the extent that such Credit Party becomes subject to Taxes subsequent to the Closing Date (or, if applicable, subsequent to the date such Person becomes a party to this Agreement) as a result of any change in the circumstances of such Credit Party (other than a change in Applicable Law), including without limitation a change in the residence, place of incorporation, principal place of business of such Credit Party or a change in the branch or lending office of such Credit Party, as the case may be, such Credit Party shall use reasonable efforts to avoid or minimize any amounts which might otherwise be payable pursuant to this SECTION 2.23(g); provided , however , that such efforts shall not include the taking of any actions by such Credit Party that would result in any tax, costs or other expense to such Credit Party (other than a tax, cost or other expense for which such Credit Party shall have been reimbursed or indemnified by the Loan Parties pursuant to this Agreement or otherwise) or any action which would or might in the reasonable opinion of such Credit Party have an adverse effect upon its business, operations or financial condition or otherwise be disadvantageous to such Credit Party.
(i) If the Administrative Agent or a Lender determines, in its good faith discretion, that it has received a refund in respect of any Indemnified Taxes or Other Taxes with respect to which the Borrower has paid additional amount pursuant to this Section 2.23, it shall pay over such refund within 30 days of its receipt thereof to the Borrower (but only to the extent of indemnity payments made, or additional amounts paid, by the Borrower or other relevant Loan Party under this Section 2.23 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such Lender or Administrative Agent and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided , that the Borrower, upon the request of such Lender or Administrative Agent, agrees to repay the amount paid over to the Borrower (plus any
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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 2.23 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.
(j) If a payment made to a Credit Party would be subject to United States federal withholding Tax imposed by FATCA if such Credit Party fails 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 Credit Party shall deliver to the Borrower and the Administrative Agent at the time or times prescribed by FATCA and at such time or times reasonably requested by the Loan Parties or the Administrative Agent (A) a certification signed by the chief financial officer, principal accounting officer, treasurer or controller, and (B) other documentation reasonably requested by the Loan Parties or the Administrative Agent sufficient for the Administrative Agent and the Loan Parties to comply with their obligations under FATCA and to determine that such Credit Party has complied with such applicable reporting requirements.
SECTION 2.24 Mitigation Obligations; Replacement of Lenders .
(a) If any Lender requests compensation under SECTION 2.14 or cannot make LIBO Loans under SECTION 2.11, 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 2.23, then such Lender shall use reasonable efforts to designate a different lending office for funding or booking its Term Loans hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the reasonable judgment of such Lender, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to SECTION 2.14 or SECTION 2.23, as the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost or expense. The Borrower hereby agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any such designation or assignment; provided , however , that the Borrower shall not be liable for such costs and expenses of a Lender requesting compensation if (i) such Lender becomes a party to this Agreement on a date after the Closing Date and (ii) the relevant Change in Law occurs on a date prior to the date such Lender becomes a party hereto.
(b) If any Lender requests compensation under SECTION 2.14 or cannot make Term Loans under SECTION 2.11 for thirty (30) consecutive days, 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 2.23, then the Borrower may, at their 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 9.04), 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 , however , that (i) the Borrower shall have received the prior written consent of the Administrative Agent, which consent shall not be unreasonably withheld, (ii) such Lender shall have received payment of an amount equal to the outstanding principal of its Term Loans, 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 2.14 or payments required to be made pursuant to SECTION 2.23, 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.
ARTICLE III
Representations and Warranties
To induce the Credit Parties to enter into this Agreement and make the Term B Loans, the Loan Parties executing this Agreement or a Joinder hereto, jointly and severally, make the following representations and warranties to each Credit Party with respect to each Loan Party on the Closing Date, and in each case as of the date such representation and warranty is made unless an earlier date is specified:
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SECTION 3.01 Organization; Powers . Each Loan Party is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite corporate or other applicable entity power and authority to own its property and assets and to carry on its business as now conducted, except, in each case, where the failure to do so, or so possess, individually or in the aggregate would not reasonably be expected to result in a Material Adverse Effect. Each Loan Party has all requisite organizational power and authority to execute and deliver and perform all its obligations under all Loan Documents to which such Loan Party is a party. Each Loan Party is qualified to do business in, and is in good standing (where such concept exists) in, every jurisdiction in which the nature of its business or the ownership or leasing of its properties makes such qualification necessary, except where the failure to be so qualified or in good standing individually or in the aggregate would not reasonably be expected to result in a Material Adverse Effect. Schedule 3.01 attached hereto sets forth, as of the Closing Date, each Loan Party’s name as it appears in official filings in its state of incorporation or organization, its state of incorporation or organization, organization type, organization number, if any, issued by its state of incorporation or organization, and its federal employer identification number.
SECTION 3.02 Authorization; Enforceability . The transactions contemplated hereby and by the other Loan Documents to be entered into by each Loan Party are within such Loan Party’s corporate powers and have been duly authorized by all necessary corporate, membership, partnership or other necessary action. This Agreement has been duly executed and delivered by each Loan Party that is a party hereto or thereto and constitutes, and each other Loan Document to which any Loan Party is a party, when executed and delivered by such Loan Party will constitute, a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03 Governmental and Other Approvals; No Conflicts . The transactions to be entered into and contemplated by the Loan Documents (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except for (i) such as have been obtained or made and are in full force and effect, (ii) filings and recordings necessary to perfect in the United States Liens created under the Loan Documents and enforce the rights of the Lenders and the Secured Parties under the Loan Documents, in each case to the extent required under the Security Documents or (iii) the failure of which to obtain would not reasonably be expected to result in a Material Adverse Effect, (b) will not violate any Applicable Law (except to the extent that such violation would not reasonably be expected to result in a Material Adverse Effect) or the Charter Documents of any Loan Party, (c) do not violate or result in a default (with due notice, lapse of grace period or both) under any indenture or any other agreement, instrument or other evidence of Material Indebtedness, except to the extent that such default would not reasonably be 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 any Loan Party, except Liens created under the Loan Documents and other Permitted Encumbrances.
SECTION 3.04 Financial Condition . The Borrower has heretofore furnished to the Agents the Consolidated balance sheet, and statements of operations, stockholders’ equity, and cash flows for the Borrower and its Subsidiaries (i) as of and for the Fiscal Years ended May 31, 2008 and May 30, 2009, and as of the last day of the Transition Period for the Transition Period, in each case audited by Deloitte & Touche LLP, independent public accountants, and (ii) as of and for the Fiscal Quarter ending October 30, 2010, certified by a Financial Officer of the Borrower. Such financial statements present fairly, in all material respects, the financial position, results of operations and cash flows of the Borrower and its Subsidiaries as of such dates and for such periods in accordance with GAAP, subject to year end audit adjustments and the absence of footnotes. Since January 30, 2010 there has been no event, change, condition or development that has had or could reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
SECTION 3.05 Properties .
(a) Except as disclosed on Schedule 3.05(a) , each Loan Party has title to, or valid leasehold interests in or right to use, all its real and personal property material to its business, except for defects which would not reasonably be expected to have a Material Adverse Effect.
(b) Schedule 3.05(b) sets forth with respect to each Loan Party a list of all registrations and issuances of the United States registered Intellectual Property owned by such Loan Party and all applications for the
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registrations or issuance thereof as of the Closing Date. To the knowledge of each Loan Party, each such registration, issuance and application is subsisting except as would not, individually or in the aggregate, have a Material Adverse Effect. To the knowledge of each Loan Party, the Intellectual Property owned by each Loan Party is valid and enforceable, and no proceeding is pending challenging the ownership, registration, validity, enforceability or use of any item of Intellectual Property except as would not, individually or in the aggregate, have a Material Adverse Effect. Each Loan Party owns or is licensed to use, all Intellectual Property used in its business, except to the extent that the failure to so own or have the right to use would not reasonably be expected to have a Material Adverse Effect, and each Loan Party’s use of Intellectual Property owned by such Loan Party does not infringe upon, misappropriate, dilute or otherwise violate the rights of any other Person, except for any such infringements, misappropriations, dilutions or other violations that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. No proceeding is pending (or to the knowledge of each Loan Party, threatened) in which any Person is alleging that a Loan Party is infringing, misappropriating, diluting, or otherwise violating the Intellectual Property rights of any Person except as would not, individually or in the aggregate, have a Material Adverse Effect.
(c) Schedule 3.05(c)(i) sets forth the address (including county) of all Real Estate that is owned by the Loan Parties as of the Closing Date. Schedule 3.05(c)(ii) sets forth the address (including county) of all Real Estate that is leased by the Loan Parties as of the Closing Date. Except as would not reasonably be expected to result in a Material Adverse Effect, to the knowledge of the Responsible Officers of the Loan Parties each of such Leases is in full force and effect and the Loan Parties are not in default of the terms thereof.
SECTION 3.06 Litigation and Environmental Matters .
(a) Except as set forth on Schedule 3.06(a) , there are no actions, suits or proceedings by or before any arbitrator or Governmental Authority pending against or, to the actual knowledge of Responsible Officers of a Loan Party, threatened in writing against or affecting any Loan Party as to which there is a reasonable expectation of an adverse determination which, if adversely determined, would reasonably be expected individually or in the aggregate to result in a Material Adverse Effect (other than Disclosed Matters).
(b) Except as set forth on Schedule 3.06(b) , no Loan Party (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 actual or potential claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability, which, in each case, individually or in the aggregate, would reasonably be expected to result in a Material Adverse Effect.
(c) Except as set forth on Schedule 3.06(c) , to the knowledge of the Loan Parties, no Real Estate or facility owned, operated or leased by any Loan Party is listed or proposed for listing on the National Priorities List promulgated pursuant to CERCLA or similar state “Superfund” list except to the extent that such filings, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
(d) Except as set forth on Schedule 3.06(d) as of the Closing Date, no Lien has been recorded or, to the knowledge of any Loan Party, threatened under any Environmental Law with respect to any Real Estate of the Loan Parties.
(e) The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby will not require any notification, registration, filing, reporting, disclosure, investigation, remediation or cleanup pursuant to any Governmental Real Property Disclosure Requirements or any other applicable Environmental Law, except for any requirement the noncompliance with which could not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.
(f) Since the date of this Agreement, there has been no change in the status of the Disclosed Matters that, individually or in the aggregate, has resulted in, or would reasonably be expected to result in, a Material Adverse Effect.
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SECTION 3.07 Compliance with Laws and Agreements . Each Loan Party is in compliance with all Applicable Law and all Material Indebtedness, and no event of default has occurred and is continuing thereunder, except in each case where the failure to comply or the existence of a default, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. Without limiting the generality of the foregoing, each Loan Party has obtained all permits, licenses and other authorizations which are required with respect to the ownership and operations of its business, except where the failure to obtain such permits, licenses or other authorizations, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect. Each Loan Party in compliance with all terms and conditions of all such permits, licenses, orders and authorizations, except where the failure to comply with such terms or conditions, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect.
SECTION 3.08 Investment and Holding Company Status . No Loan Party is an “investment company” as defined in, and subject to regulation under, the Investment Company Act of 1940, as amended.
SECTION 3.09 Taxes . Each Loan Party 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, for which such Loan Party has set aside on its books adequate reserves in accordance with GAAP, and as to which no Lien has arisen or (b) to the extent that the failure to do so would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
SECTION 3.10 ERISA . The Loan Parties and their ERISA Affiliates are in compliance with the applicable provisions of ERISA and the Code with respect to each Plan except as would not reasonably be expected to result in a Material Adverse Effect. Each Plan which is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service and nothing has occurred subsequent to the issuance of such determination letter which would cause such Plan to lose its qualified status. Since the Closing Date, 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, except as set forth on Schedule 3.10 . The present value of all accumulated benefit obligations under each Plan subject to ERISA (based on the assumptions used for purposes of the most recent actuarial report prepared by such Plan’s actuaries) 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 that would reasonably be expected to result in a Material Adverse Effect.
SECTION 3.11 Disclosure . None of the reports, financial statements, certificates or other information (other than any projections, pro formas, budgets and general market information) concerning the Loan Parties furnished by or on at the direction of any Loan Party to any Credit Party in connection with the negotiation of this Agreement or any other Loan Document or delivered hereunder or thereunder (as modified or supplemented by other information so furnished), when taken as a whole, contains, as of the date furnished, any material misstatement of fact or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not materially misleading in light of the circumstances under which such statements were made.
SECTION 3.12 Subsidiaries .
(a) Schedule 3.12 sets forth the name of, and the ownership interest of each Loan Party in, each Subsidiary as of the Closing Date; there is no other Capital Stock of any class outstanding as of the Closing Date. To the knowledge of the Loan Parties, all such shares of Capital Stock as of the Closing Date are validly issued, fully paid, and, with respect to corporate shares, nonassessable.
(b) No Loan Party is party to any joint venture or similar agreement as of the Closing Date.
SECTION 3.13 Insurance . Schedule 3.13 sets forth a description of all business interruption, general liability, directors and officers liability, comprehensive, casualty and other insurance maintained by or on behalf of the Loan Parties as of the Closing Date. Each insurance policy listed on Schedule 3.13 is in full force and effect as of the Closing Date and all premiums in respect thereof that are due and payable as of the Closing Date have been paid
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and such insurance is in such amounts and covering such risks and liabilities (and with such deductibles, retentions and exclusions) as are in accordance with normal and prudent industry practice. As of the Closing Date, none of BCF Holdings or any of its Subsidiaries (a) has received notice from any insurer (or any agent thereof) that substantial capital improvements or other substantial expenditures will have to be made in order to continue such insurance or (b) has any reason to believe that it will not be able to renew its existing coverage as and when such coverage expires or to obtain similar coverage from similar insurers at a substantially similar cost.
SECTION 3.14 Labor Matters . As of the Closing Date, there are no strikes, lockouts or slowdowns against any Loan Party pending or, to the actual knowledge of any Responsible Officer of any Loan Party, threatened, except to the extent that strikes, lockouts or slowdowns would not reasonably be expected to result in a Material Adverse Affect. The hours worked by and payments made to employees of the Loan Parties have not been in violation of the Fair Labor Standards Act or any other applicable federal, state, local or foreign law dealing with such matters to the extent that any such violation could reasonably be expected to have a Material Adverse Effect. Except for Disclosed Matters and to the extent that such liability would not reasonably be expected to have a Material Adverse Effect, all payments due from any Loan Party, or for which any claim may be made against any Loan Party, on account of wages and employee health and welfare insurance and other benefits, have been paid or accrued in accordance with GAAP as a liability on the books of such Loan Party. Except as set forth on Schedule 3.14 , as of the Closing Date no Loan Party is a party to or bound by any material collective bargaining agreement, bonus, restricted stock, stock option, or stock appreciation plan or agreement or any similar plan, agreement or arrangement. As of the Closing Date, the consummation of the transactions contemplated by the Loan Documents will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which any Loan Party is bound to the extent that such would be reasonably expected to result in a Material Adverse Effect.
SECTION 3.15 Security Documents . The Security Documents create in favor of the Collateral Agent, for the benefit of the Collateral Agent and the other Secured Parties, a legal, valid and enforceable security or mortgage interests in the Collateral (subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law), and the Security Documents constitute, or will upon the filing of financing statements or other instruments within the time periods prescribed under Applicable Law and/or the obtaining of “control,” in each case with respect to the relevant Collateral as required under the applicable Uniform Commercial Code or similar legislation of any jurisdiction, to the extent security interests in such Collateral can be perfected by such filings or control, the creation of a fully perfected and enforceable first priority Lien on, and security interest in, all right, title and interest of the Loan Parties thereunder in such Collateral (to the extent required under the Security Documents), in each case prior and superior in right to any other Person, except for Permitted Encumbrances (x) having priority by operation of Applicable Law on all Term Priority Collateral, (y) in favor of the agent under the ABL Facility on any Revolver Priority Collateral or (z) Qualifying Secured Debt ranking pari passu with the Liens securing the Obligations.
SECTION 3.16 Federal Reserve Regulations .
No Loan Party is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of buying or carrying Margin Stock. As of the Closing Date, no Loan Party owns any Margin Stock.
No part of the proceeds of any Term Loan will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, (i) to buy or carry Margin Stock or to extend credit to others for the purpose of buying or carrying Margin Stock or to refund indebtedness originally incurred for such purpose in violation of Regulation U or X or (ii) for any purpose that entails a violation of, or that is inconsistent with, the provisions of the Regulations of the Board, including Regulation U or Regulation X.
SECTION 3.17 Solvency . The Loan Parties, on a Consolidated basis, are Solvent (and, on the Closing Date will be Solvent immediately after giving effect to the Transactions). No transfer of property is being made by any Loan Party and no obligation is being incurred by any Loan Party in connection with the Transactions, this Agreement or the other Loan Documents with the intent to hinder, delay, or defraud either present or future creditors of any Loan Party.
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ARTICLE IV
Conditions
SECTION 4.01 Closing Date . The obligation of the Lenders to make Term B Loans on the Closing Date is subject to the satisfaction or waiver of each of the following conditions precedent:
(a) The Agents (or their counsel) shall have received from each party thereto either (i) a counterpart of this Agreement and the Security Agreement signed on behalf of such party or (ii) written evidence satisfactory to the Agents (which may include telecopy transmission or electronic pdf copy of a signed signature page of this Agreement) that such party has signed a counterpart of this Agreement and the Security Agreement Loan Documents.
(b) The Agents and the Arrangers shall have received a written opinion (addressed to each Agent, the Arrangers and the Lenders and dated the Closing Date) of Kirkland & Ellis LLP, special counsel for the Loan Parties, and Martinez Odell & Calabria, special Puerto Rican counsel to the Loan Parties, covering such matters relating to the Loan Parties, the Loan Documents or the transactions contemplated thereby as the Agents shall reasonably request. The Loan Parties hereby request such counsel to deliver such opinions.
(c) The Agents shall have received Charter Documents and such other documents and certificates as the Agents or their counsel may reasonably request relating to the organization and existence of each Loan Party and the authorization of the transactions contemplated by the Loan Documents thereby in form and substance reasonably satisfactory to the Agents, the Arrangers and their counsel.
(d) The Administrative Agent shall have received a notice with respect to such Borrowing as required by Article II.
(e) The Agents and the Arrangers shall have received a certificate, reasonably satisfactory in form and substance to the Agents and the Arrangers, certifying that, as of the Closing Date immediately prior to and immediately following the Dividend Payment, no Default or Event of Default exists and the Loan Parties, taken as a whole, are Solvent and that immediately after the Transactions, no Default or Event of Default will exist and the Loan Parties, taken as a whole, will be Solvent.
(f) The representations and warranties set forth in Article III are true and correct in all material respects.
(g) The Collateral Agent shall have received results of searches or other evidence reasonably satisfactory to the Collateral Agent (in each case dated as of a date reasonably satisfactory to the Collateral Agent) indicating the absence of Liens on the assets of the Loan Parties, except for Permitted Encumbrances and Liens for which termination statements and releases or subordination agreements are being tendered on the Closing Date.
(h) The Agents shall be reasonably satisfied that all fees due at or immediately after the Closing Date and all Credit Party Expenses incurred by in connection with the establishment of the credit facility contemplated hereby (including the reasonable fees and expenses of counsel to the Agents), shall be paid in full from the proceeds of the initial borrowing hereunder.
(i) The Borrower and/or their Affiliates shall have received the proceeds from the Senior Notes, which Senior Notes shall be consistent with the terms set forth in the Offering Memorandum for the Senior Notes dated February 17, 2011.
(j) The Collateral Agent shall have received (i) fully executed copies of the Security Agreement, the Pledge Agreement, short-form security agreements in appropriate form for filing with the United States Patent and Trademark Office and United States Copyright Office with respect to the
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Collateral consisting of United States registered patents, trademarks and copyrights, (ii) UCC-1 financing statements appropriately completed and naming the Collateral Agent as secured party and each Loan Party as debtor in appropriate form for filing with the applicable filing office in the jurisdiction of organization of each Loan Party and (iii) all certificates of stock of the Loan Parties and their Subsidiaries constituting Collateral together with appropriate stock powers or other instruments of transfer .
(k) There shall have been delivered to the Agents and the Arrangers all documentation and other information requested by them that is required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the Act (as defined in Section 9.16 below).
(l) To the extent not otherwise set forth in this SECTION 4.01, there shall have been delivered to the Agents and the Arrangers each of the instruments, agreements, opinions, certificates and other documents identified on the closing agenda attached hereto as Exhibit F .
ARTICLE V
Affirmative Covenants
Until (i) the Commitments have expired or been terminated and (ii) the principal of and interest on the Term Loans and all fees and other Obligations (other than contingent indemnity obligations with respect to then unasserted claims) shall have been paid in full, each Loan Party covenants and agrees with the Credit Parties that:
SECTION 5.01 Financial Statements and Other Information . The Borrower will furnish to the Administrative Agent:
(a) Within ninety (90) days after the end of each Fiscal Year of BCF Holdings commencing with the Fiscal Year ending January 29, 2011, the Consolidated balance sheet and related statements of operations, and Consolidated statements of cash flows as of the end of and for such year for BCF Holdings and its Subsidiaries, setting forth in comparative form, the Consolidated figures for the previous Fiscal Year and the figures as set forth in the projections delivered pursuant to SECTION 5.01(e), all audited and reported on by independent public accountants of recognized national standing (without a “going concern” or like qualification or exception and without a qualification or exception as to the scope of such audit), except for the aforementioned projections, to the effect that such Consolidated financial statements present fairly in all material respects the financial condition and results of operations of the applicable Loan Parties and their Subsidiaries on a Consolidated basis in accordance with GAAP;
(b) Within forty-five (45) days after the end of each Fiscal Quarter of BCF Holdings commencing with the Fiscal Quarter ending April 30, 2011, excluding the last Fiscal Quarter of each Fiscal Year of BCF Holdings, the Consolidated balance sheet and related statements of operations, and Consolidated statements of cash flows for BCF Holdings and its Subsidiaries as of the end of and for such Fiscal Quarter and the elapsed portion of the Fiscal Year, setting forth in each case, in comparative form the Consolidated figures for the previous Fiscal Year and the figures as set forth in the projections delivered pursuant to SECTION 5.01(e), all such Consolidated figures certified by one of the Borrower’s Financial Officers as fairly presenting in all material respects the financial condition and results of operations of the Loan Parties and their Subsidiaries on a Consolidated basis in accordance with GAAP, subject to year end audit adjustments and the absence of footnotes;
(c) Within thirty (30) days after the end of each Fiscal Month of BCF Holdings and its Subsidiaries commencing with the Fiscal Month ending February 26, (i) internally prepared monthly operating financial reports for BCF Holdings and its Subsidiaries, as of the end of and for such Fiscal Month and the elapsed portion of the Fiscal Year, all certified by one of the Borrower’s Financial Officers as, to such officer’s knowledge, presenting in all material respects the financial condition and results of operations of the Loan Parties and their Subsidiaries on a Consolidated basis, and (ii) such reports as are prepared by the Loan Parties’ management for their own use, including the Consolidated balance sheet and related statements of operations, and Consolidated statements of cash flows for BCF Holdings and its Subsidiaries, as
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of the end of and for such Fiscal Month and the elapsed portion of the Fiscal Year, setting forth in each case, in comparative form the Consolidated figures for the previous Fiscal Year and the figures as set forth in the projections delivered pursuant to SECTION 5.01(e), all certified by one of the Borrower’s Financial Officers as fairly presenting in all material respects the financial condition and results of operations of the Loan Parties and their Subsidiaries on a Consolidated basis in accordance with GAAP, subject to normal year end audit adjustments and the absence of footnotes;
(d) Concurrently with any delivery of financial statements under clause (a) or clause (b) above, a certificate of a Financial Officer of the Borrower in the form of Exhibit E hereto (a “ Compliance Certificate ”) (i) certifying as to whether a Default or Event of Default has occurred and, if a Default or Event of 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 with respect to the Excess Cash Flow (in the case of any delivery of financial statements under clause (a) above for any Fiscal Year ending after the Closing Date), Consolidated Leverage Ratio and Consolidated Interest Coverage Ratio, in each case, for such period, (iii) detailing all Store openings and Store closings during the immediately preceding fiscal period and stating the aggregate number of the Loan Parties’ and their Subsidiaries’ Stores as of the first day of the current fiscal period, (iv) setting forth the Cure Amount, if any, exercised in the immediately preceding fiscal period and (v) stating whether any change in GAAP or in the application thereof has occurred since the date of BCF Holdings’ most recent audited financial statements and, if any such change has occurred, specifying the effect of such change on the financial statements accompanying such Compliance Certificate;
(e) Within sixty (60) days after the commencement of each Fiscal Year of the Loan Parties, commencing with the Fiscal Year ending January 28, 2012, a detailed, Consolidated budget by month for the applicable Fiscal Year for BCF Holdings and its Subsidiaries and including a projected Consolidated income statement, balance sheet, and statement of cash flow, by month, and promptly when available, any revisions to such budget resulting from any Permitted Acquisition, Permitted Disposition or other transaction, the effect of which would reasonably be expected to change the projected Consolidated EBITDA of the Loan Parties in the subsequent Fiscal Year by 20% or more;
(f) Reserved;
(g) Promptly after the same become publicly available, copies of (i) all material periodic and other reports, proxy statements and other materials filed by any Loan Party with the SEC, and (ii) SEC Forms 10-K and 10-Q for BCF Holdings (for so long as BCF Holdings is subject to the reporting requirements under the Securities Exchange Act of 1934, as amended);
(h) Promptly upon receipt thereof, copies of all material reports submitted to any Loan Party by independent certified public accountants in connection with each annual or special audit of the books of the Loan Parties or any of their Subsidiaries made by such accountants, including any management letter commenting on the Loan Parties’ internal controls submitted by such accountants to management in connection with their annual audit;
(i) Reserved;
(j) A detailed summary of the Net Proceeds received from any Prepayment Event resulting in Net Proceeds in excess of $5,000,000 within five (5) Business Days after receipt of such Net Proceeds other than from sales of Inventory in the ordinary course of business;
(k) Reserved;
(l) Promptly following any reasonable request therefor, such other information regarding the operations, business affairs and financial condition of any Loan Party as the Agents may reasonably request (other than information which is subject to an attorney-client privilege or would result in a breach of a confidentiality obligation of the Loan Parties to any other Person); and
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(m) Not later than any date on which financial statements are delivered with respect to any period in which any Pro Forma Adjustment is made as a result of the consummation of an acquisition of an Acquired Entity, a disposition of an entity or business or a shut-down of any discontinued operations, as the case may be, for which there shall be any Pro Forma Adjustments, a certificate of one of the Borrower’s Responsible Officers setting forth the amount of such Pro Forma Adjustments and, in reasonable detail, the calculations and basis therefor.
Documents required to be delivered pursuant to this SECTION 5.01 (to the extent any such documents are included in materials otherwise filed with the SEC) may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which such documents are posted on the Borrower’s behalf on IntraLinks/IntraAgency or another relevant website (the “ Informational Website ”), if any, to which each Lender and the Administrative Agent have unrestricted access (whether a commercial, third-party website or whether sponsored by the Administrative Agent); provided that (A) the accommodation provided by the foregoing sentence shall not impair the right of the Administrative Agent, or any Lender through the Administrative Agent, to request and receive from the Borrower physical delivery of specific financial information provided for in this SECTION 5.01 and (B) the Borrower shall give the Administrative Agent and each Lender (or if applicable, the Administrative Agent shall give each Lender) written or electronic notice each time any information is delivered by posting to the Informational Website. The Credit Parties shall have no liability to any Loan Party or any Credit Party associated with establishing and maintaining the security and confidentiality of the Informational Website and the information posted thereto.
SECTION 5.02 Notices of Material Events . The Borrower will furnish to the Administrative Agent prompt written notice of the occurrence of any of the following after any Responsible Officer of the Borrower obtains knowledge thereof:
(a) A Default or Event of Default, specifying the nature and extent thereof and the action (if any) which is proposed to be taken with respect thereto;
(b) The filing or commencement of any action, suit or proceeding by or before any arbitrator or Governmental Authority against or affecting any Loan Party or any Subsidiary of the Borrower that, if adversely determined, would reasonably be expected to result in a Material Adverse Effect;
(c) The occurrence of an ERISA Event that, alone or together with any other ERISA Events that have occurred, would reasonably be expected to result in a liability to BCF Holdings, any of its Subsidiaries or any of their respective ERISA Affiliates in excess of $25,000,000 or would reasonably be expected to result in a Material Adverse Effect;
(d) Any development that results in a Material Adverse Effect;
(e) Any change in any Loan Party’s chief executive officer or chief financial officer;
(f) Any material change in any Loan Party’s financial reporting practices;
(g) Any strikes, lockouts or slowdowns against any Loan Party which would reasonably be expected to result in a Material Adverse Effect;
(h) The filing of any Lien for unpaid Taxes against any Loan Party in excess of $5,000,000;
(i) The discharge by any Loan Party of its present independent accountants or any withdrawal or resignation by such independent accountants; and
(j) Any casualty or other insured damage to any portion of the Term Priority Collateral in excess of $5,000,000, or the commencement of any action or proceeding for the taking of any interest in a portion of the Term Priority Collateral in excess of $5,000,000 or any part thereof or interest therein under power of eminent domain or by condemnation or similar proceeding.
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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, if applicable, any action taken or proposed to be taken with respect thereto.
SECTION 5.03 Information Regarding Collateral . The Borrower will furnish to the Agents prompt written notice of any change in: (a) any Loan Party’s name; (b) the location of any Loan Party’s chief executive office or its principal place of business; (c) any Loan Party’s organizational structure or jurisdiction of incorporation or formation; or (d) any Loan Party’s Federal Taxpayer Identification Number or organizational identification number assigned to it by its state of organization. The Loan Parties agree not to effect or permit any change referred to in the preceding sentence unless all filings, publications and registrations, have been made (or will be made in a timely fashion) under the Uniform Commercial Code or other Applicable Law that are required in order for the Collateral Agent to continue at all times following such change to have a valid, legal and perfected first priority security interest to the extent required under the Security Documents (subject only to Permitted Encumbrances having priority by operation of Applicable Law and Liens permitted to be pari passu to the Liens of the Collateral Agent pursuant to the Pari Passu Intercreditor Agreement) in all the Collateral for its own benefit and the benefit of the other Secured Parties.
SECTION 5.04 Existence; Conduct of Business . Each Loan Party will do all things necessary to comply with its Charter Documents in all material respects, and to obtain, preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges, franchises, patents, copyrights, trademarks and trade names material to the conduct of its business, except to the extent that the failure to do so would not reasonably be expected to have a Material Adverse Effect; provided , however , that the foregoing shall not prohibit any merger, consolidation, liquidation or dissolution permitted under SECTION 6.03 or SECTION 6.05.
SECTION 5.05 Payment of Obligations . Each Loan Party will pay its Taxes 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 and such Loan Party or such Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP, (b) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (c) the failure to make payment, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.
SECTION 5.06 Maintenance of Properties . Each Loan Party will keep and maintain all tangible property material to the conduct of its business in substantially the same condition as of the Closing Date (ordinary wear and tear, casualty loss and condemnation excepted), except (a) where the failure to do so would not reasonably be expected to result in a Material Adverse Effect and (b) for Store closings and Permitted Dispositions permitted hereunder. Each Loan Party will use commercially reasonable efforts to prosecute, maintain, and enforce the Intellectual Property, except to the extent such Intellectual Property is no longer used or deemed by such Loan Party in its reasonable business judgment to be useful in the conduct of the business of the Loan Parties.
SECTION 5.07 Insurance .
(a) Each Loan Party shall (i) maintain insurance with financially sound and reputable insurers (or, to the extent consistent with business practices in effect on the Closing Date, a program of self-insurance) on such of its property and in at least such amounts and against at least such risks as is consistent with business practices in effect on the Closing Date or as otherwise determined by the Responsible Officers of the Loan Parties acting reasonably in their business judgment, including public liability insurance against claims for personal injury or death occurring upon, in or about or in connection with the use of any properties owned, occupied or controlled by it (including the insurance required pursuant to the Security Documents); (ii) maintain such other insurance as may be required by law; and (iii) furnish to the Agents, upon written request, full information as to the insurance carried.
(b) Fire and extended coverage policies maintained with respect to any Collateral shall be endorsed or otherwise amended to include (i) a lenders’ loss payable clause (regarding personal property), in form and substance reasonably satisfactory to the Agents, which endorsements or amendments shall provide that the insurer shall pay all proceeds otherwise payable to the Loan Parties under the policies directly to the Administrative Agent, (ii) a provision to the effect that none of the Loan Parties, Credit Parties (in their capacity as such) or any other Affiliate of a Loan Party shall be a co-insurer (the foregoing not being deemed to limit the amount of self-insured retention or
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deductibles under such policies, which self-insured retention or deductibles shall be consistent with business practices in effect on the Closing Date or as otherwise determined by the Responsible Officers of the Loan Parties acting reasonably in their business judgment), and (iii) such other provisions as the Administrative Agent may reasonably request from time to time to protect the interests of the Credit Parties. Commercial general liability policies shall be endorsed to name the Collateral Agent as an additional insured. Business interruption policies shall name the Collateral Agent as a loss payee and shall be endorsed or amended to include (i) a provision that after the occurrence and during the continuance of a Specified Default and notice from the Collateral Agent to the insurer, the insurer shall pay all proceeds of such business interruption policies otherwise payable to the Loan Parties under the policies directly to the Collateral Agent and (ii) such other provisions to the endorsement as the Administrative Agent may reasonably request from time to time to protect the interests of the Credit Parties. Each such casualty or liability policy referred to in this SECTION 5.07(b) shall also provide that it shall not be canceled, modified in any manner that would cause this SECTION 5.07 to be violated, or not renewed (i) by reason of nonpayment of premium except upon not less than thirty (30) days’ prior written notice thereof by the insurer to the Administrative Agent (giving the Administrative Agent the right to cure defaults in the payment of premiums) or (ii) for any other reason except upon not less than thirty (30) days’ prior written notice thereof by the insurer to the Administrative Agent. The Borrower shall deliver to the Administrative Agent, prior to the cancellation, modification or non-renewal of any such policy of insurance, a copy of a renewal or replacement policy (or other evidence of renewal of a policy previously delivered to the Administrative Agent, including an insurance binder) together with evidence satisfactory to the Administrative Agent of payment of the premium therefor.
(c) If any portion of any Mortgaged Property is at any time located in an area identified by the Federal Emergency Management Agency (or any successor agency) as a Special Flood Hazard Area with respect to which flood insurance has been made available under the National Flood Insurance Act of 1968 (as now or hereafter in effect or successor act thereto), then the Borrower shall, or shall cause each Loan Party to (i) maintain, or cause to be maintained, with a financially sound and reputable insurer, flood insurance in an amount and otherwise sufficient to comply with all applicable rules and regulations promulgated pursuant to the Flood Insurance Laws and (ii) deliver to the Administrative Agent evidence of such compliance in form and substance reasonably acceptable to the Administrative Agent.
(d) The Agents acknowledge that the insurance policies described on Schedule 3.13 are satisfactory to them as of the Closing Date and are in compliance with the provisions of this SECTION 5.07.
SECTION 5.08 Books and Records; Inspection and Audit Rights; Appraisals; Accountants .
(a) Each Loan Party will keep proper books of record and account in accordance with GAAP and in which full, true and correct entries are made of all dealings and transactions in relation to its business and activities. Each Loan Party will permit any representatives designated by any Agent, upon reasonable prior notice, to visit and inspect its properties, to discuss its affairs, finances and condition with its officers and to examine and make extracts from its books and records, all at such reasonable times and as often as reasonably requested.
(b) At its election, upon its reasonable belief that any Loan Party has breached any representation, warranty or covenant herein relating to environmental matters in any material respect, or in connection with the enforcement of remedies against any Real Estate after the occurrence and during the continuance of an Event of Default, the Collateral Agent or any Lender may, at its own cost and expense, retain an independent engineer or environmental consultant to conduct an environmental assessment (but, prior to the occurrence of any such Event of Default, only with respect to the subject matter of such breach, including, as relevant to such breach, of the condition of any Real Estate or facility of any Loan Party) and/or such Loan Party’s compliance with Environmental Law. Each Loan Party shall cooperate in the performance of any such environmental assessment and permit any such engineer or consultant designated by the Collateral Agent or such Lender to have full access to each property or facility at reasonable times and after reasonable notice to the Borrower of the plans to conduct such an environmental assessment. Environmental assessments conducted under this paragraph shall be limited to visual inspections of the Real Estate or facility, interviews with representatives of the Loan Parties or facility personnel, and review of applicable records and documents pertaining to the condition of the property or facility, its compliance with Environmental Law and any potential Environmental Liabilities, in each case prior to the occurrence and during the continuance of an Event of Default, to the extent relevant to the subject matter of such breach. All environmental assessments conducted pursuant to this paragraph shall be at the Loan Parties’ sole cost and expense.
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SECTION 5.09 Reserved .
SECTION 5.10 Compliance with Laws . Each Loan Party will comply with all Applicable Laws and the orders of any Governmental Authority except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect. Except where the failure to do so, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect, each Loan Party shall: (a) conduct its operations and keep and maintain its Real Estate in compliance with all Environmental Laws; and (b) implement any and all investigation, remediation, removal and response actions that are appropriate or necessary to materially comply with Environmental Laws pertaining to the presence, generation, treatment, storage, use, disposal, transportation or Release of any Hazardous Materials on, at, in, under, above, to, from or about any of its Real Estate. The Loan Parties shall notify the Administrative Agent promptly after such Person becomes aware of any violation of or non-compliance with any Environmental Laws or any Release on, at, in, under, above, to, from or about any Real Estate that is reasonably likely to result in Environmental Liabilities in excess of $1,000,000 individually or in the aggregate; and (d) promptly forward to Administrative Agent a copy of any order, notice, request for information or any communication or report received by such Person in connection with any such violation or Release or any other matter that could reasonably be expected to result in Environmental Liabilities in excess of $1,000,000 individually or in the aggregate in each case whether or not any Governmental Authority has taken or threatened any action in connection with any such violation, Release or other matter.
SECTION 5.11 Use of Proceeds . The proceeds of the Term B Loans made hereunder will be used only to finance a portion of the Transactions. The proceeds of Incremental Term Loans shall be used for general corporate purposes (except for Refinancing Term Loans, the proceeds of which shall be applied pursuant to SECTION 2.17). No part of the proceeds of any Term Loans will be used, whether directly or indirectly, for any purpose that entails a violation of any of the regulations of the Board, including Regulations U and X.
SECTION 5.12 Additional Subsidiaries . If any Loan Party shall form or acquire a Subsidiary that is not an Immaterial Subsidiary, a Foreign Subsidiary or a Subsidiary in which substantially all of its assets consist of the Capital Stock of one or more Foreign Subsidiaries after the Closing Date, the Borrower will notify the Agents thereof and will cause such Subsidiary to become a Loan Party hereunder and under each applicable Security Document in the manner provided therein within ten (10) Business Days after such Subsidiary is formed or acquired and promptly take such actions to create and perfect Liens on such Subsidiary’s assets to secure the Obligations as the Agents shall reasonably request. If any shares of Capital Stock or Indebtedness of such Subsidiary are owned by or on behalf of any Loan Party, the Borrower will cause such shares and promissory notes evidencing such Indebtedness to be pledged to secure the Obligations within ten (10) Business Days after such Subsidiary is formed or acquired (except that, if such Subsidiary is a Foreign Subsidiary or a Subsidiary in which substantially all of its assets consist of the Capital Stock of one or more Foreign Subsidiaries, shares of Capital Stock of such Subsidiary to be pledged may be limited to 65% of the outstanding shares of Capital Stock of such Subsidiary).
SECTION 5.13 Further Assurances . Each Loan Party will execute any and all further documents, financing statements, agreements and instruments, and take all such further actions (including the filing and recording of financing statements and other documents), that may be required under any Applicable Law, or which any Agent or the Required Lenders may reasonably request, to effectuate the transactions contemplated by the Loan Documents or to grant, preserve, protect or perfect in the United States the Liens created or intended to be created by the Security Documents or the validity or priority of any such Lien, all at the expense of the Loan Parties, and in each case to the extent required under the Security Documents.
SECTION 5.14 Post Closing Covenants . The Loan Parties shall comply with the terms and conditions set forth on Schedule 5.14.
ARTICLE VI
Negative Covenants
Until (i) the Commitments have expired or been terminated and (ii) the principal of and interest on each Term Loan and all fees and other Obligations (other than contingent indemnity obligations with respect to then unasserted claims) shall have been paid in full, each Loan Party covenants and agrees with the Credit Parties that:
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SECTION 6.01 Indebtedness and Other Obligations . No Loan Party will, nor will it permit any of its Subsidiaries to, create, incur, assume or permit to exist any Indebtedness, except Permitted Indebtedness.
SECTION 6.02 Liens . No Loan Party will, nor will it permit any of its Subsidiaries to, create, incur, assume or permit to exist any Lien on any property or asset now owned or hereafter acquired by it, except Permitted Encumbrances.
SECTION 6.03 Fundamental Changes .
(a) No Loan Party will, nor will it permit any of its Subsidiaries to, merge into or consolidate with any other Person, or permit any other Person to merge into or consolidate with it, or liquidate or dissolve, except that, if at the time thereof and immediately after giving effect thereto no Default or Event of Default shall have occurred and be continuing or would arise therefrom, (i) any Subsidiary may liquidate, dissolve, consolidate, or merge into a Loan Party in a transaction in which a Loan Party is the surviving corporation, (ii) any Subsidiary that is not a Loan Party may liquidate, dissolve, consolidate, or merge into any Subsidiary that is not a Loan Party, (iii) any Loan Party may merge with or into any other Loan Party, (iv) the Loan Parties and its Subsidiaries may dispose of Capital Stock of their respective Subsidiaries in a transaction permitted by SECTION 6.05, and (v) Permitted Acquisitions and transactions permitted pursuant to SECTION 6.05 may be consummated in the form of a merger or consolidation, as long as, in the event of a Permitted Acquisition, a Loan Party is the surviving Person, provided that any such merger involving a Person that is not a wholly owned Subsidiary immediately prior to such merger shall not be permitted unless also permitted by SECTION 6.04.
(b) No Loan Party will engage, to any material extent, in any business other than businesses of the type conducted by such Loan Party on the date of execution of this Agreement and businesses reasonably related thereto and those supportive, complementary or ancillary thereto.
SECTION 6.04 Investments, Guarantees and Acquisitions . No Loan Party will, nor will it permit any of its Subsidiaries to, make or permit to exist any Investment, except Permitted Investments.
SECTION 6.05 Asset Sales . No Loan Party will, nor will it permit any of its Subsidiaries to, sell, transfer, lease (as lessor), license (as licensor), abandon or otherwise voluntarily dispose of any asset, including any Capital Stock of another Person, except sales of Inventory and the use of cash or cash equivalents in the ordinary course of business, transactions permitted by SECTION 6.03 and Permitted Dispositions and the making of Permitted Investments (to the extent such Investment would involve a sale, transfer or disposition of any assets).
SECTION 6.06 Restricted Payments; Certain Payments of Indebtedness .
(a) No Loan Party will, nor will it permit any of its Subsidiaries to, declare or make, or agree to pay or make, directly or indirectly, any Restricted Payment, except that:
(i) Any Loan Party or any Subsidiary of a Loan Party may declare and pay cash dividends or make other distributions of property to a Loan Party, provided that any such Restricted Payments made to BCF Holdings or Parent under this clause (i) shall be used (w) to pay general corporate and overhead expenses incurred by BCF Holdings or Parent in the ordinary course of business, or the amount of any indemnification claims made by any director or officer of BCF Holdings or Parent, (x) to pay franchise taxes and other fees, taxes and expenses required to maintain the corporate existence of BCF Holdings or Parent, (y) to pay taxes that are due and payable by BCF Holdings as the parent of a consolidated group that includes Parent and its Subsidiaries or (z) to make other payments that BCF Holdings and Parent are not otherwise prohibited from making pursuant to this Agreement;
(ii) The Loan Parties and their Subsidiaries may make Restricted Payments for the purpose of paying amounts owing under the Advisory Agreement, to the extent permitted under SECTION 6.07;
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(iii) The Loan Parties and their Subsidiaries may make Restricted Payments consisting of Permitted Dispositions of the type described, and subject to the limitations contained, in the definition thereof;
(iv) The Loan Parties and their Subsidiaries may make Restricted Payments constituting repurchases of equity interests in BCF Holdings or any Subsidiary (or distributions to BCF Holdings for such purpose) in connection with the exercise of stock options or warrants if such equity interests represent a portion of the exercise price of such option or warrants, provided that Restricted Payments made pursuant to this clause (iv) shall not exceed $5,000,000 in any Fiscal Year of BCF Holdings;
(v) in addition to the foregoing Restricted Payments, the Borrower may declare, pay and/or make the Dividend Payment; and
(vi) so long as (x) no Default or Event of Default has occurred and is continuing, (y) on a Pro Forma Basis, the Borrower would be in compliance with each of the Financial Performance Covenants for the most recently ended Fiscal Quarter for which financial statements have been or are then required to have been delivered and (z) the Consolidated Leverage Ratio as of the last day of the most recently ended Fiscal Quarter for which financial statements have been or are then required to have been delivered would be less than or equal to 3.5 to 1.0, any Loan Party or any Subsidiary may make any Restricted Payment.
(b) No Loan Party will, nor will it permit any of its Subsidiaries to, make or agree to pay or make any payment or other distribution (whether in cash, securities or other property) of or in respect of principal of or interest on any Specified Indebtedness, or any payment or other distribution (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 Specified Indebtedness, except:
(i) payments in Capital Stock (so long as no Change of Control would result therefrom) and payments of interest in-kind of the Loan Parties and their Subsidiaries;
(ii) payments of regularly scheduled interest in respect of any Subordinated Indebtedness (subject to applicable subordination provisions relating thereto);
(iii) payments of principal (including mandatory prepayments) and interest as and when due in respect of any Specified Indebtedness (other than Subordinated Indebtedness);
(iv) prepayment in whole or in part of Specified Indebtedness from any refinancing of such Specified Indebtedness with the proceeds of (x) any equity securities (other than Permitted Cure Securities) issued or capital contributions received by any Loan Party or any Subsidiary for the purpose of making such payment or prepayment and/or (y) other Indebtedness not prohibited hereunder;
(v) so long as no Default or Event of Default has occurred and is continuing, any Loan Party and any of its Subsidiaries may make payments in respect of Specified Indebtedness from the portion of the Available Amount such Loan Party or such Subsidiary elects to apply pursuant to this clause (v); and
(vi) refinancings of Specified Indebtedness to the extent permitted under this Agreement.
SECTION 6.07 Transactions with Affiliates . No Loan Party will, nor will it permit any of its 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 with, any of its Affiliates, except (a) transactions in the ordinary course of business that are at prices and on terms and conditions, taken as a whole, not less favorable to such Loan Party or Subsidiary than could be obtained on an arm’s-length basis from unrelated third parties, (b) transactions between or among the Loan Parties and their Subsidiaries not otherwise prohibited hereunder, (c) payments due pursuant to the Advisory Agreement on account of Advisory Fees consisting of payments (but not prepayments) on account of annual advisory fees provided that such payments may not be made if an Event of Default under SECTIONS 7.01(a), 7.01(b), 7.01(h) or 7.01(i) has occurred and is continuing or would arise therefrom,
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provided further that such fees not paid shall accrue and be paid when the applicable Event of Default has been cured or waived and no additional Event of Default of this type has occurred and is continuing or would arise as a result of such payment, and (iii) transaction fees, provided that such payments in excess of $1,000,000 may not be made if a Specified Default exists or would arise therefrom, provided further that such fees in excess of $1,000,000 not paid shall accrue and be paid when the applicable Specified Default has been cured or waived and no additional Specified Default has occurred and is continuing or would arise as a result of such payment, (d) payments of indemnities and reasonable expense reimbursements under the Advisory Agreement, (e) as set forth on Schedule 6.07 , (f) payment of reasonable compensation to officers and employees for services actually rendered to any such Loan Party or any of its Subsidiaries, (g) payment of director’s fees, expenses and indemnities, (h) stock option, stock incentive, equity, bonus and other compensation plans of the Loan Parties and their Subsidiaries, (i) employment contracts with officers and management of the Loan Parties and their Subsidiaries, (j) Restricted Payments to the extent specifically permitted under this Agreement, (k) advances and loans to officers and employees of the Loan Parties and their Subsidiaries to the extent specifically permitted under this Agreement, (l) Investments consisting of notes from officers, directors and employees to purchase equity interests to the extent specifically permitted under this Agreement, (m) payments pursuant to the tax sharing agreements among the Loan Parties and their Subsidiaries to the extent attributable to the ownership or operations of BCF Holdings and its Subsidiaries and to the extent permitted under Section 6.06(a)(i) and (n) other transactions with Affiliates specifically permitted under this Agreement (including, without limitation, sale/leaseback transactions, Permitted Dispositions, Restricted Payments, Permitted Investments and Indebtedness).
SECTION 6.08 Restrictive Agreements . No Loan Party will, nor will it permit any of its Subsidiaries to, directly or indirectly enter into, incur or permit to exist any agreement or other arrangement that prohibits, restricts or imposes any condition upon (a) the ability of any Loan Party to create, incur or permit to exist any Lien upon any of its property or assets in favor of the Collateral Agent or (b) the ability of any Subsidiary thereof to pay dividends or other distributions with respect to any shares of its Capital Stock to such Loan Party or to make or repay loans or advances to a Loan Party or to guarantee Indebtedness of the Loan Parties, provided that (i) the foregoing shall not apply to restrictions and conditions imposed by Applicable Law, by any Loan Document, by any documents in existence on the Closing Date or under any documents relating to joint ventures of any Loan Party to the extent that such joint ventures are not prohibited hereunder, (ii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of assets or equity permitted hereunder by a Loan Party or a Subsidiary pending such sale, provided such restrictions and conditions apply only to the assets of the Loan Party or Subsidiary that are to be sold and such sale is permitted hereunder, (iii) clause (a) of the foregoing shall not apply to restrictions or conditions imposed by any agreement relating to secured Indebtedness permitted by this Agreement if such restrictions or conditions apply only to the property or assets securing such Indebtedness and (iv) clause (a) of the foregoing shall not apply to customary provisions in contracts or leases restricting the assignment or subleasing or sublicensing thereof, (v) the foregoing shall not apply to any agreement related to Indebtedness under the Senior Notes or the ABL Facility, (vi) clause (a) of the foregoing shall not apply to licenses or contracts which by the terms of such licenses and contracts prohibit the granting of Liens on the rights contained therein, (vii) the foregoing shall not apply to any restrictions in existence prior to the time any such Person became a Subsidiary and not created in contemplation of any such acquisition, and (viii) the foregoing shall not apply to any restrictions in Qualifying Unsecured Debt and Qualifying Secured Debt so long as such restrictions are not materially more onerous, taken as a whole, to the Borrower and its Subsidiaries than the terms of this Agreement.
SECTION 6.09 Amendment of Material Documents . No Loan Party will amend, modify or waive any of its rights under (a) its Charter Documents, (b) the nature of the obligations under any guaranty of recourse obligations, (c) the Advisory Agreement, or (d) any Material Indebtedness, in each case to the extent that such amendment, modification or waiver would reasonably likely have a Material Adverse Effect.
SECTION 6.10 Financial Performance Covenants .
(a) Consolidated Leverage Ratio . The Borrower shall not permit the Consolidated Leverage Ratio on the last day of any Fiscal Quarter set forth below to be greater than the ratio set forth opposite such Fiscal Quarter below:
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|
Fiscal Quarter |
Ratio | |||
|
Fiscal Quarter ending on April 30, 2011 |
6.75:1.00 | |||
|
Fiscal Quarter ending on July 30, 2011 |
6.75:1.00 | |||
|
Fiscal Quarter ending on October 29, 2011 |
6.75:1.00 | |||
|
Fiscal Quarter ending on January 28, 2012 |
6.75:1.00 | |||
|
Fiscal Quarter ending on April 28, 2012 |
6.75:1.00 | |||
|
Fiscal Quarter ending on July 28, 2012 |
6.75:1.00 | |||
|
Fiscal Quarter ending on October 27, 2012 |
6.75:1.00 | |||
|
Fiscal Quarter ending on February 2, 2013 |
6.25:1.00 | |||
|
Fiscal Quarter ending on May 4, 2013 |
6.25:1.00 | |||
|
Fiscal Quarter ending on August 3, 2013 |
6.25:1.00 | |||
|
Fiscal Quarter ending on November 2, 2013 |
6.25:1.00 | |||
|
Fiscal Quarter ending on February 1, 2014 |
5.50:1.00 | |||
|
Fiscal Quarter ending on May 3, 2014 |
5.50:1.00 | |||
|
Fiscal Quarter ending on August 2, 2014 |
5.50:1.00 | |||
|
Fiscal Quarter ending on November 1, 2014 |
5.50:1.00 | |||
|
Fiscal Quarter ending on January 31, 2015 |
5.00:1.00 | |||
|
Fiscal Quarter ending on May 2, 2015 |
5.00:1.00 | |||
|
Fiscal Quarter ending on August 1, 2015 |
5.00:1.00 | |||
|
Fiscal Quarter ending on October 31, 2015 |
5.00:1.00 | |||
|
Fiscal Quarter ending on January 30, 2016 |
4.75:1.00 | |||
|
Fiscal Quarter ending on April 30, 2016 |
4.75:1.00 | |||
|
Fiscal Quarter ending on July 30, 2016 |
4.75:1.00 | |||
|
Fiscal Quarter ending on October 29, 2016 |
4.75:1.00 | |||
|
Fiscal Quarter ending on January 28, 2017 |
4.75:1.00 | |||
(b) Consolidated Interest Coverage Ratio . The Borrower shall not permit the Consolidated Interest Coverage Ratio on the last day of any Fiscal Quarter set forth below to be less than the ratio set forth opposite such Fiscal Quarter below:
|
Fiscal Quarter |
Ratio | |||
|
Fiscal Quarter ending on April 30, 2011 |
1.75:1.00 | |||
|
Fiscal Quarter ending on July 30, 2011 |
1.75:1.00 | |||
|
Fiscal Quarter ending on October 29, 2011 |
1.75:1.00 | |||
|
Fiscal Quarter ending on January 28, 2012 |
1.75:1.00 | |||
|
Fiscal Quarter ending on April 28, 2012 |
1.75:1.00 | |||
|
Fiscal Quarter ending on July 28, 2012 |
1.75:1.00 | |||
|
Fiscal Quarter ending on October 27, 2012 |
1.75:1.00 | |||
|
Fiscal Quarter ending on February 2, 2013 |
1.85:1.00 | |||
|
Fiscal Quarter ending on May 4, 2013 |
1.85:1.00 | |||
|
Fiscal Quarter ending on August 3, 2013 |
1.85:1.00 | |||
|
Fiscal Quarter ending on November 2, 2013 |
1.85:1.00 | |||
|
Fiscal Quarter ending on February 1, 2014 |
2.00:1.00 | |||
|
Fiscal Quarter ending on May 3, 2014 |
2.00:1.00 | |||
|
Fiscal Quarter ending on August 2, 2014 |
2.00:1.00 | |||
|
Fiscal Quarter ending on November 1, 2014 |
2.00:1.00 | |||
|
Fiscal Quarter ending on January 31, 2015 |
2.00:1.00 | |||
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|
Fiscal Quarter ending on May 2, 2015 |
2.00:1.00 | |||
|
Fiscal Quarter ending on August 1, 2015 |
2.00:1.00 | |||
|
Fiscal Quarter ending on October 31, 2015 |
2.00:1.00 | |||
|
Fiscal Quarter ending on January 30, 2016 |
2.10:1.00 | |||
|
Fiscal Quarter ending on April 30, 2016 |
2.10:1.00 | |||
|
Fiscal Quarter ending on July 30, 2016 |
2.10:1.00 | |||
|
Fiscal Quarter ending on October 29, 2016 |
2.10:1.00 | |||
|
Fiscal Quarter ending on January 28, 2017 |
2.10:1.00 | |||
(c) Capital Expenditures . The Borrower shall not and shall not permit any of its Subsidiaries to, make or commit to make any Capital Expenditure that would cause the aggregate amount of such Capital Expenditures made by the Loan Parties in any Fiscal Year of the Borrower commencing with the Fiscal Year ending January 28, 2012 to exceed the sum of (i) (x) in the case of the first two Fiscal Years ending after the Closing Date, $150,000,000 and (y) in the case of each Fiscal Year ending thereafter, $130,000,000 (in each case, such amount, the “ Permitted Capital Expenditure Amount ”) and (ii) the portion of the Available Amount the Borrower elects to apply pursuant to this clause (ii); provided that to the extent that Capital Expenditures during any Fiscal Year are less than the applicable Permitted Capital Expenditure Amount, (x) up to 100% of any such unused amount may be carried over for expenditure in the next succeeding Fiscal Year and (y) Capital Expenditures made pursuant to this Section during any Fiscal Year shall be deemed made, first, in respect of amounts carried over from the prior Fiscal Year pursuant to subclause (x) above and second, to the applicable Permitted Capital Expenditure Amount. Notwithstanding the foregoing, following the closing of any Permitted Acquisition or any other Investment consisting of the purchase of a business unit, line of business or a division of a Person or all or substantially all of the assets of a Person permitted hereunder, the applicable Permitted Capital Expenditure Amount shall be automatically increased by an amount equal to the greater of (A) the average annual historical capital expenditures made with respect to such acquired business for the last three fiscal years applicable to such acquired business ending prior to such Permitted Acquisition or other Investment and (B) 2.5% of the revenues applicable to such acquired business for the twelve month period most recently ended.
SECTION 6.11 Fiscal Year . No Loan Party will change its Fiscal Year.
ARTICLE VII
Events of Default
SECTION 7.01 Events of Default . If any of the following events (“ Events of Default ”) shall occur:
(a) Any Loan Party shall fail to pay any principal of any Term 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 by acceleration or otherwise;
(b) Any Loan Party shall fail to pay any interest on any Term Loan or any fee or any other amount (other than an amount referred to in SECTION 7.01(a)) as the same shall become due and payable under this Agreement or any other Loan Document and such failure continues for five (5) Business Days;
(c) Any representation or warranty made or deemed made by or on behalf of any Loan Party in, or in connection with, any Loan Document or any amendment or modification thereof or waiver thereunder (including, without limitation, in any certificate of a Financial Officer accompanying any financial statement) 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 when due any covenant, condition or agreement contained in (i) SECTION 6.10 (after a three (3) day grace period), or (ii) any other Section of ARTICLE VI or (iii) in any of SECTION 5.02(a), SECTION 5.07 or SECTION 5.11 ( provided that, if (A) any such Default described in this clause (iii) is of a type that can be cured within 5 Business Days and (B) such Default could not materially adversely impact the Lenders’ Liens on the Collateral, such default shall
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not constitute an Event of Default for 5 Business Days after the occurrence of such Default so long as the Loan Parties are diligently pursuing the cure of such Default);
(e) Any Loan Party shall fail to observe or perform when due any covenant, condition or agreement contained in any Loan Document (other than those specified in SECTION 7.01(a), SECTION 7.01(b), SECTION 7.01(c), or SECTION 7.01(d)), and such failure shall continue unremedied for a period of thirty (30) days after notice thereof from the Administrative Agent to the Borrower;
(f) (i) Any Loan Party 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 giving effect to the expiration of any grace or cure period set forth therein) or (ii) any event or condition occurs that results in any Material Indebtedness becoming due prior to its scheduled maturity or (iii) any event or condition occurs that enables or permits (with or without the giving of notice, the lapse of time or both) the holder or holders of any such Material Indebtedness or any trustee or agent on its or their behalf to cause any such Material Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance thereof, prior to its scheduled maturity, which default, event or condition is not being contested in good faith; provided that any event of default under the ABL Facility shall not constitute a Default or Event of Default under this clause (f)(iii) unless such event of default has not been waived for a period of 60 consecutive days following the occurrence thereof;
(g) a Change in Control shall occur;
(h) An involuntary proceeding shall be commenced or an involuntary petition shall be filed seeking (i) liquidation, reorganization or other relief in respect of any Loan Party or its debts, or of a substantial part of its assets, under the Bankruptcy Code or any other 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 any Loan Party or for a substantial part of its assets, and, in any such case, such proceeding or petition shall continue undismissed for sixty (60) days or an order or decree approving or ordering any of the foregoing shall be entered;
(i) Any Loan Party shall (i) voluntarily commence any proceeding or file any petition seeking liquidation, reorganization or other relief under the Bankruptcy Code or any other federal, state, provincial 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 SECTION 7.01(h), (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for any Loan Party 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) Reserved;
(k) One or more final judgments for the payment of money in an aggregate amount in excess of $40,000,000, (or such lesser amount as would reasonably be expected to result in a Material Adverse Effect or an Event of Default under the ABL Agreement) in excess of insurance coverage (or indemnities from indemnitors reasonably satisfactory to the Agents) shall be rendered against any Loan Party or any combination of Loan Parties and the same shall remain undischarged for a period of forty-five (45) days during which execution shall not be effectively stayed, satisfied or bonded or any action shall be legally taken by a judgment creditor to attach or levy upon any material assets of any Loan Party to enforce any such judgment;
(l) An ERISA Event (other than any ERISA Event set forth on Schedule 3.10 ) shall have occurred that when taken together with all other ERISA Events that have occurred, would reasonably be expected to result in a liability of any Loan Party in excess of $25,000,000 or such other amount that would reasonably be expected to result in a Material Adverse Effect and the same shall remain undischarged for a period of thirty (30) consecutive days;
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(m) Any challenge by or on behalf of any Loan Party to the validity of any Loan Document or the applicability or enforceability of any Loan Document strictly in accordance with the subject Loan Document’s terms or which seeks to void, avoid, limit, or otherwise adversely affect any security interest created by or in any Loan Document or any payment made pursuant thereto;
(n) Any challenge by or on behalf of any other Person to the validity of any Loan Document or the applicability or enforceability of any Loan Document strictly in accordance with the subject Loan Document’s terms or which seeks to void, avoid, limit, or otherwise adversely affect any security interest created by or in any Loan Document or any payment made pursuant thereto, in each case, as to which an order or judgment has been entered materially adverse to the Agents and the Lenders;
(o) Any Lien purported to be created under any Security Document shall cease to be, or shall be asserted by any Loan Party not to be, a valid and perfected Lien on any such Collateral, with the priority required by (but subject to the limitations set forth in) the applicable Security Document and this Agreement except (i) as a result of the sale, release or other disposition of the applicable Collateral in a Permitted Disposition or other transaction permitted under the Loan Documents or, (ii) relating to an immaterial amount of Collateral not constituting Term Priority Collateral, or (iii) as a result of the failure of the Collateral Agent, through its acts or omissions and through no fault of the Loan Parties, to maintain the perfection of its Liens in accordance with Applicable Law;
(p) The occurrence of any uninsured loss to any material portion of the Collateral which would reasonably be expected to result in a Material Adverse Effect;
(q) The termination of the Facility Guaranty or any other guaranty of the Obligations (except for any release or termination permitted hereunder);
(r) The indictment of any Loan Party, under any Applicable Law where the crime alleged would constitute a felony under Applicable Law and such indictment remains unquashed or such legal process remains undismissed for a period of 90 days or more, unless the Administrative Agent, in its reasonable discretion, determines that the indictment is not material; or
(s) the imposition of any stay or other order, the effect of which restrains the conduct by the Loan Parties, taken as a whole, of their business in the ordinary course in a manner that has resulted in, or could reasonably be expected to have, a Material Adverse Effect;
then, and in every such event (other than an event with respect to any Loan Party described in SECTION 7.01(h) or SECTION 7.01(i)), and at any time thereafter during the continuance of such event the Administrative Agent may, and at the request of the Required Lenders, shall, by notice to the Borrower, take any or all of the following actions, at the same or different times: (a) require each of the following to become immediately due and payable, in each case without presentment, demand, protest or other requirements of any kind, all of which are hereby expressly waived by each Loan Party to the extent permitted under Applicable Law: (i) the unpaid principal amount of and accrued interest on the Term Loans and (ii) all other Obligations; and (b) subject to the Intercreditor Agreements, cause the Collateral Agent to enforce any and all Liens and security interests created pursuant to the Security Documents. In the case of any event with respect to any Loan Party described in SECTION 7.01(h) or SECTION 7.01(i), (a) each of the following shall automatically become immediately due and payable, in each case without presentment, demand, protest or other requirements of any kind, all of which are hereby expressly waived by each Loan Party to the extent permitted under Applicable Law: (i) the unpaid principal amount of and accrued interest on the Term Loans and (ii) all other Obligations, and (b) Administrative Agent may, subject to the Intercreditor Agreements, cause Collateral Agent to enforce any and all Liens and security interests created pursuant to Collateral Documents.
Notwithstanding anything to the contrary contained in this Article VII, in the event that the Borrower fails to comply with the requirements of any Financial Performance Covenant for any Fiscal Quarter, from the first day of such Fiscal Quarter until the date that is ten days after the date the Compliance Certificate calculating such Financial Performance Covenant is required to be delivered pursuant to SECTION 5.01(d), BCF Holdings and/or Parent shall have the right to issue Permitted Cure Securities for cash or otherwise receive cash contributions to the common
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capital of BCF Holdings and/or Parent, as the case may be, the proceeds of which BCF Holdings and/or Parent, as the case may be, will contribute in cash to the Borrower as common equity (collectively, the “ Cure Right ”); provided that at the Borrower’s option, the Borrower may elect to exercise such Cure Right prior to the date of the delivery of the Compliance Certificate if the Borrower reasonably determines that it will fail to comply with the requirements of any Financial Performance Covenant upon the delivery of such Compliance Certificate, and upon the receipt by the Borrower of such cash (the “ Cure Amount ”) pursuant to the exercise by the Borrower of such Cure Right such Financial Performance Covenants shall be recalculated giving effect to the following pro forma adjustments:
(i) Consolidated EBITDA shall be increased, solely for the purpose of measuring the Financial Performance Covenants and not for any other purpose under this Agreement, by an amount equal to the Cure Amount; and
(ii) if, after giving effect to the foregoing recalculations, the Borrower shall then be in compliance with the requirements of all Financial Performance Covenants, the Borrower shall be deemed to have satisfied the requirements of the Financial Performance Covenants as of the relevant date of determination with the same effect as though there had been no failure to comply therewith at such date, and the applicable breach or default of the Financial Performance Covenants that had occurred shall be deemed cured for this purposes of this Agreement.
Notwithstanding anything herein to the contrary, (a) in each four-Fiscal-Quarter period there shall be at least two Fiscal Quarters in which the Cure Right is not exercised and no more than four Cure Rights shall be exercised during the term of this Agreement, (b) the Cure Amount shall be no greater than 120% of the amount required for purposes of complying with the Financial Performance Covenants and (c) the Cure Amount shall be set forth in each applicable Compliance Certificate delivered pursuant to SECTION 5.01(d).
SECTION 7.02 Remedies on Default . In case any one or more of the Events of Default shall have occurred and be continuing, and whether or not the maturity of the Obligations shall have been accelerated pursuant hereto, the Agents may (and at the direction of the Required Lenders, shall) proceed to protect and enforce their rights and remedies under this Agreement or any of the other Loan Documents by suit in equity, action at law or other appropriate proceeding, whether for the specific performance of any covenant or agreement contained in this Agreement and the other Loan Documents or any instrument pursuant to which the Obligations are evidenced, and, if such amount shall have become due, by declaration or otherwise, proceed to enforce the payment thereof or any other legal or equitable right of the Secured Parties. No remedy herein is intended to be exclusive of any other remedy and each and every remedy shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute or any other provision of law.
SECTION 7.03 Application of Proceeds . After the occurrence and during the continuance of any Event of Default and acceleration of the Obligations, all proceeds realized from any Loan Party or on account of any Collateral owned by a Loan Party or, without limiting the foregoing, on account of any Prepayment Event or Excess Cash Flow, any payments in respect of any Obligations and all proceeds of the Collateral, shall be applied in the following order:
(a) FIRST, ratably to pay the Obligations in respect of any Credit Party Expenses, indemnities and other amounts then due to the Agents until paid in full;
(b) SECOND, ratably to pay any Credit Party Expenses and indemnities, and to pay any fees then due to the Lenders, until paid in full;
(c) THIRD, ratably to pay interest accrued in respect of the Obligations until paid in full;
(d) FOURTH, to pay principal due in respect of the Term Loans until paid in full; and
(e) FIFTH, to the Borrower or such other Person entitled thereto under Applicable Law.
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ARTICLE VIII
The Agents
SECTION 8.01 Appointment and Administration by Administrative Agent . Each Credit Party hereby irrevocably designates JPMorgan Chase Bank, N.A. as Administrative Agent under this Agreement and the other Loan Documents. The general administration of the Loan Documents shall be by the Administrative Agent. The Credit Parties each hereby (a) irrevocably authorizes the Administrative Agent (i) to enter into the Loan Documents to which it is a party, and (ii) at its discretion, to take or refrain from taking such actions as agent on its behalf and to exercise or refrain from exercising such powers under the Loan Documents as are delegated by the terms hereof or thereof, as appropriate, together with all powers reasonably incidental thereto, and (b) agrees and consents to all of the provisions of the Security Documents. The Administrative Agent shall have no duties or responsibilities except as set forth in this Agreement and the other Loan Documents, nor shall it have any fiduciary relationship with any other Credit Party, and no implied covenants, responsibilities, duties, obligations, or liabilities shall be read into the Loan Documents or otherwise exist against the Administrative Agent.
SECTION 8.02 Appointment of Collateral Agent . Each Secured Party hereby irrevocably designates JPMorgan Chase Bank, N.A. as Collateral Agent under this Agreement and the other Loan Documents. The Secured Parties each hereby (i) irrevocably authorizes the Collateral Agent (x) to enter into the Loan Documents to which it is a party, and (y) at its discretion, to take or refrain from taking such actions as agent on its behalf and to exercise or refrain from exercising such powers under the Loan Documents as are delegated by the terms hereof or thereof, as appropriate, together with all powers reasonably incidental thereto, and (ii) agrees and consents to all of the provisions of the Security Documents. All Collateral shall be held or administered by the Collateral Agent (or its duly-appointed agent) for its own benefit and for the ratable benefit of the other Credit Parties. Any proceeds received by the Collateral Agent from the foreclosure, sale, lease or other disposition of any of the Collateral and any other proceeds received pursuant to the terms of the Security Documents or the other Loan Documents shall be paid over to the Administrative Agent for application as provided in this Agreement and the other Loan Documents. The Collateral Agent shall have no duties or responsibilities except as set forth in this Agreement and the other Loan Documents, nor shall it have any fiduciary relationship with any other Secured Party, and no implied covenants, responsibilities, duties, obligations, or liabilities shall be read into the Loan Documents or otherwise exist against the Collateral Agent.
SECTION 8.03 Sharing of Excess Payments . Except as otherwise provided in this Agreement, at any time or times any Lender shall receive (i) by payment, foreclosure, setoff, banker’s lien, counterclaim, or otherwise, or any payments with respect to the Obligations owing to such Secured Party arising under, or relating to, this Agreement or the other Loan Documents, or (ii) payments from the Administrative Agent in excess of such Secured Party’s ratable portion of all such distributions by the Administrative Agent, such Secured Party shall promptly (1) turn the same over to the Administrative Agent, in kind, and with such endorsements as may be required to negotiate the same to the Administrative Agent, or in same day funds, as applicable, for the account of all of the Secured Parties and for application to the Obligations in accordance with the applicable provisions of this Agreement, or (2) purchase, without recourse or warranty, an undivided interest and participation in the Obligations owed to the other Secured Parties so that such excess payment received shall be applied ratably as among the Secured Parties in accordance with the provisions of SECTION 2.17 or SECTION 7.03, as applicable; provided , however , that if all or part of such excess payment received by the purchasing party is thereafter recovered from it, those purchases of participations shall be rescinded in whole or in part, as applicable, and the applicable portion of the purchase price paid therefor shall be returned to such purchasing party, but without interest except to the extent that such purchasing party is required to pay interest in connection with the recovery of the excess payment. In no event shall the provisions of this paragraph be construed to apply to any payment made by the Borrower pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Term Loans to any assignee or participant, other than, except as provided in this Agreement or may be approved by the Required Lenders, to the Borrower or any Subsidiary thereof (as to which provisions of this paragraph shall apply).
SECTION 8.04 Agreement of Applicable Lenders . Upon any occasion requiring or permitting an approval, consent, waiver, election or other action on the part of the Applicable Lenders, action shall be taken by each Agent for and on behalf or for the benefit of all Credit Parties upon the direction of the Applicable Lenders, and any
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such action shall be binding on all Credit Parties. No amendment, modification, consent, or waiver shall be effective except in accordance with the provisions of SECTION 9.02.
SECTION 8.05 Liability of Agents .
(a) The Agents, when acting on behalf of the Credit Parties, may execute any of their respective duties under this Agreement or any of the other Loan Documents by or through any of their respective officers, agents and employees, and no Agent nor any of their respective directors, officers, agents or employees shall be liable to any other Secured Party for any action taken or omitted to be taken in good faith, or be responsible to any other Secured Party for the consequences of any oversight or error of judgment, or for any loss, except to the extent of any liability imposed by law by reason of such Agent’s own gross negligence or willful misconduct (as determined by a court of competent jurisdiction in a final and non-appealable decision). No Agent nor any of their respective directors, officers, agents and employees shall in any event be liable to any other Secured Party for any action taken or omitted to be taken by it pursuant to instructions received by it from the Applicable Lenders, or in reliance upon the advice of counsel selected by it. Without limiting the foregoing no Agent, nor any of their respective directors, officers, employees, or agents shall be: (i) responsible to any other Secured Party for the due execution, validity, genuineness, effectiveness, sufficiency, or enforceability of, or for any recital, statement, warranty or representation in, this Agreement, any other Loan Document or any related agreement, document or order; (ii) required to ascertain or to make any inquiry concerning the performance or observance by any Loan Party of any of the terms, conditions, covenants, or agreements of this Agreement or any of the Loan Documents; (iii) responsible to any other Secured Party for the state or condition of any properties of the Loan Parties or any other obligor hereunder constituting Collateral for the Obligations or any information contained in the books or records of the Loan Parties; (iv) responsible to any other Secured Party for the validity, enforceability, collectibility, effectiveness or genuineness of this Agreement or any other Loan Document or any other certificate, document or instrument furnished in connection therewith; or (v) responsible to any other Secured Party for the validity, priority or perfection of any Lien securing or purporting to secure the Obligations or for the value or sufficiency of any of the Collateral.
(b) The Agents may execute any of their duties under this Agreement or any other Loan Document by or through their agents or attorneys-in-fact, and shall be entitled to the advice of counsel concerning all matters pertaining to its rights and duties hereunder or under the other Loan Documents. The Agents shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by them with reasonable care.
(c) None of the Agents nor any of their respective directors, officers, employees, or agents shall have any responsibility to any Loan Party on account of the failure or delay in performance or breach by any other Secured Party (other than by each such Agent in its capacity as a Lender) of any of its respective obligations under this Agreement or any of the other Loan Documents or in connection herewith or therewith.
(d) The Agents shall be entitled to rely, and shall be fully protected in relying, upon any notice, consent, certificate, affidavit, or other document or writing believed by them to be genuine and correct and to have been signed, sent or made by the proper person or persons, and upon the advice and statements of legal counsel (including, without, limitation, counsel to the Loan Parties), independent accountants and other experts selected by any Loan Party or any Secured Party. The Agents shall be fully justified in failing or refusing to take any action under this Agreement or any other Loan Document unless they shall first receive such advice or concurrence of the Applicable Lenders as they deem appropriate or they shall first be indemnified to their satisfaction by the other Secured Parties against any and all liability and expense which may be incurred by them by reason of the taking or failing to take any such action.
SECTION 8.06 Notice of Default . No Agent shall be deemed to have knowledge or notice of the occurrence of any Default or Event of Default unless such Agent has actual knowledge of the same or has received notice from a Secured Party or Loan Party referring to this Agreement, describing such Default or Event of Default and stating that such notice is a “notice of default.” In the event that an Agent obtains such actual knowledge or receives such a notice, such Agent shall give prompt notice thereof to each of the other Secured Parties. Upon the occurrence of an Event of Default, the Agents shall (subject to the provisions of SECTION 9.02) take such action with respect to such Default or Event of Default as shall be reasonably directed by the Required Lenders. Unless and until the Agents shall have received such direction, the Agents may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to any such Default or Event of Default as they shall deem advisable in the
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best interest of the Secured Parties. In no event shall the Agents be required to comply with any such directions to the extent that the Agents believe that their compliance with such directions would be unlawful.
SECTION 8.07 Credit Decisions . Each Secured Party (other than the Agents) acknowledges that it has, independently and without reliance upon the Agents or any other Secured Party, and based on the financial statements prepared by the Loan Parties and such other documents and information as it has deemed appropriate, made its own credit analysis and investigation into the business, assets, operations, property, and financial and other condition of the Loan Parties and has made its own decision to enter into this Agreement and the other Loan Documents. Each Credit Party (other than the Agents) also acknowledges that it will, independently and without reliance upon the Agents or any other Secured Party, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in determining whether or not conditions precedent to closing any Revolving Credit Loan hereunder have been satisfied and in taking or not taking any action under this Agreement and the other Loan Documents.
SECTION 8.08 Reimbursement and Indemnification . Each Secured Party (other than the Agents) agrees to (i) reimburse the Agents for such Secured Party’s pro rata share of all Obligations held by such Secured Party of (x) any expenses and fees incurred by any Agent for the benefit of Secured Parties under this Agreement and any of the other Loan Documents, including, without limitation, counsel fees and compensation of agents and employees paid for services rendered on behalf of the Secured Parties, and any other expense incurred in connection with the operations or enforcement thereof not reimbursed by the Loan Parties, and (y) any expenses of any Agent incurred for the benefit of the Secured Parties that the Loan Parties have agreed to reimburse pursuant to this Agreement or any other Loan Document and have failed to so reimburse, and (ii) indemnify and hold harmless each Agent and any of their respective directors, officers, employees, or agents, on demand, in the amount of such Secured Party’s pro rata share of all Obligations held by such Secured Party, from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses, or disbursements of any kind or nature whatsoever which may be imposed on, incurred by, or asserted against it or any Secured Party in any way relating to or arising out of this Agreement or any of the other Loan Documents or any action taken or omitted by it or any of them under this Agreement or any of the other Loan Documents to the extent not reimbursed by the Loan Parties, including, without limitation, costs of any suit initiated by each Agent against any Secured Party (except such as shall have been determined by a court of competent jurisdiction or another independent tribunal having jurisdiction by final and non-appealable judgment to have resulted from the gross negligence or willful misconduct of such Agent); provided , however , that the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against such Secured Party in its capacity as such. The provisions of this SECTION 8.08 shall survive the repayment of the Obligations and the termination of the Commitments.
SECTION 8.09 Rights of Agents . It is understood and agreed that the Agents shall have the same rights and powers hereunder (including the right to give such instructions) as the other Lenders and may exercise such rights and powers, as well as their rights and powers under other agreements and instruments to which they are or may be party, and engage in other transactions with the Loan Parties, as though they were not the Agents. Each Agent and their respective Affiliates may accept deposits from, lend money to, and generally engage in any kind of commercial or investment banking, trust, advisory or other business with the Loan Parties and their Affiliates as if it were not an Agent thereunder.
SECTION 8.10 Notice of Transfer . The Administrative Agent may deem and treat a Lender party to this Agreement as the owner of such Lender’s portion of the Obligations for all purposes, unless and until, and except to the extent, an Assignment and Acceptance shall have become effective as set forth in SECTION 9.04.
SECTION 8.11 Successor Agents . Any Agent may resign at any time by giving thirty (30) Business Days’ written notice thereof to the other Secured Parties and the Borrower. Upon any such resignation of an Agent, the Required Lenders shall have the right to appoint a successor Agent, which, so long as there is no Specified Default, shall be reasonably satisfactory to the Borrower (whose consent in any event shall not be unreasonably withheld, delayed or conditioned). If no successor Agent shall have been so appointed by the Required Lenders and/or none shall have accepted such appointment within thirty (30) days after the retiring Agent’s giving of notice of resignation, the retiring Agent may, on behalf of the other Secured Parties, appoint a successor Agent which shall be a Person a commercial bank (or affiliate thereof) organized under the laws of the United States of America or of any State thereof and having a combined capital and surplus of a least $1,000,000,000, or capable of complying with all
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of the duties of such Agent hereunder (in the opinion of the retiring Agent and as certified to the other Secured Parties in writing by such successor Agent) which, so long as there is no Specified Default, shall be reasonably satisfactory to the Borrower (whose consent shall not in any event be unreasonably withheld, delayed or conditioned). Upon the acceptance of any appointment as Agent by a successor Agent, such successor Agent shall thereupon succeed to and become vested with all the rights, powers, privileges and duties of the retiring Agent and the retiring Agent shall be discharged from its duties and obligations under this Agreement. After any retiring Agent’s resignation hereunder as such Agent, the provisions of this Article VIII shall inure to its benefit as to any actions taken or omitted to be taken by it while it was such Agent under this Agreement.
SECTION 8.12 Relation Among the Lenders . The Lenders are not partners or co-venturers, and no Lender shall be liable for the acts or omissions of, or (except as otherwise set forth herein in case of any Agent) authorized to act for, any other Lender.
SECTION 8.13 Reports and Financial Statements . By signing this Agreement, each Lender:
(a) is deemed to have requested that the Agents furnish such Lender, promptly after they become available, copies of all financial statements required to be delivered by the Borrower hereunder and all commercial finance examinations and appraisals of the Collateral received by the Agents (collectively, the “ Reports ”) (and the Agents agree to furnish such Reports promptly to the Lenders, which Reports may be furnished in accordance with the final paragraph of SECTION 5.01);
(b) expressly agrees and acknowledges that no Agent makes any representation or warranty as to the accuracy of the Reports, and shall not be liable for any information contained in any Report;
(c) expressly agrees and acknowledges that the Reports are not comprehensive audits or examinations, that the Agents or any other party performing any audit or examination will inspect only specific information regarding the Loan Parties and will rely significantly upon the Loan Parties’ books and records, as well as on representations of the Loan Parties’ personnel;
(d) agrees to keep all Reports confidential and strictly for its internal use, and not to distribute except to its participants, or use any Report in any other manner; and
(e) without limiting the generality of any other indemnification provision contained in this Agreement, agrees: (i) to hold each Agent and any such other Lender preparing a Report harmless from any action the indemnifying Lender may take or conclusion the indemnifying Lender may reach or draw from any Report in connection with any Term Loans that the indemnifying Lender has made or may make to the Borrower, or the indemnifying Lender’s participation in, or the indemnifying Lender’s purchase of, a Term Loan or Term Loans of the Borrower; and (ii) to pay and protect, and indemnify, defend, and hold each Agent and any such other Lender preparing a Report harmless from and against, the claims, actions, proceedings, damages, costs, expenses, and other amounts (including attorney costs) incurred by the Agents and any such other Lender preparing a Report as the direct or indirect result of any third parties who might obtain all or part of any Report through the indemnifying Lender in violation of the terms hereof.
SECTION 8.14 Agency for Perfection . Each Lender hereby appoints each other Lender as agent for the purpose of perfecting Liens for the benefit of the Agents and the Secured Parties, in assets which, in accordance with Article 9 of the UCC or any other Applicable Law of the United States of America can be perfected only by possession. Should any Secured Party (other than an Agent) obtain possession of any such Collateral, such Secured Party shall notify the Collateral Agent thereof, and, promptly upon the Collateral Agent’s request therefor shall deliver such Collateral to the Collateral Agent, or otherwise deal with such Collateral in accordance with the Collateral Agent’s instructions.
SECTION 8.15 Authority to Enter Into Intercreditor Agreements . The Administrative Agent and Collateral Agent are hereby authorized, without any further consent of any Lender (other than the consent of the Required Lenders provided in connection with this Agreement) to enter into any Pari Passu Lien Intercreditor Agreement or Second Lien Intercreditor Agreement with the holders of any Qualifying Secured Debt (or their agents) and to
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amend any Intercreditor Agreement in order to include the holders of such Qualifying Secured Debt appropriately therein.
SECTION 8.16 Collateral Matters .
(a) The Lenders hereby irrevocably authorize the Collateral Agent to release any Lien upon any Collateral (i) upon the termination of the Commitments and payment and satisfaction in full of all Obligations (other than contingent indemnity obligations with respect to then unasserted claims), or (ii) constituting property being sold, transferred or disposed of in a Permitted Disposition upon receipt by the Administrative Agent of the Net Proceeds thereof to the extent required by this Agreement. Except as provided above, the Collateral Agent will not release any of the Collateral Agent’s Liens without the prior written authorization of the Applicable Lenders. Upon request by any Agent or any Loan Party at any time, the Lenders will confirm in writing the Collateral Agent’s authority to release any Liens upon particular types or items of Collateral pursuant to this SECTION 8.16.
(b) Upon at least two (2) Business Days’ prior written request by the Borrower, the Collateral Agent shall (and is hereby irrevocably authorized by the Lenders to) execute such documents as may be necessary to evidence the release of the Liens upon any Collateral described in SECTION 8.16(b); provided , however , that (i) the Collateral Agent shall not be required to execute any such document on terms which, in its reasonable opinion, would, under Applicable Law, expose the Collateral Agent to liability or create any obligation or entail any adverse consequence other than the release of such Liens without recourse or warranty, and (ii) such release shall not in any manner discharge, affect or impair the Obligations or any Liens (other than those expressly being released) upon (or obligations of any Loan Party in respect of) all interests retained by any Loan Party, including (without limitation) the proceeds of any sale, all of which shall continue to constitute part of the Collateral.
SECTION 8.17 Syndication Agent and Arrangers . Notwithstanding the provisions of this Agreement or any of the other Loan Documents, the Syndication Agent and the Arrangers shall have no powers, rights, duties, responsibilities or liabilities with respect to this Agreement and the other Loan Documents.
SECTION 8.18 Withholding Taxes . To the extent required by any applicable law, the Administrative Agent may deduct or withhold from any payment to any Lender an amount equivalent to any applicable withholding tax. If the Internal Revenue Service or any authority of the United States or other jurisdiction asserts a claim that the Administrative Agent did not properly withhold tax from amounts paid to or for the account of any Lender (because the appropriate form was not delivered, was not properly executed, or because such Lender failed to notify the Administrative Agent of a change in circumstances that rendered the exemption from, or reduction of, withholding tax ineffective, or for any other reason), such Lender shall indemnify and hold harmless the Administrative Agent (to the extent that the Administrative Agent has not already been reimbursed by the Borrower pursuant to Sections 2.14 and 2.23 and without limiting, expanding or otherwise affecting any obligation of the Borrower to do so) fully for all amounts paid, directly or indirectly, by the Administrative Agent as Tax or otherwise, together with all expenses incurred, including legal expenses, allocated staff costs and any out of pocket expenses ,whether or not such Tax was correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. The agreements in this Section 8.18 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 Agreement and the repayment, satisfaction or discharge of all other obligations.
ARTICLE IX
Miscellaneous
SECTION 9.01 Notices . Except in the case of notices and other communications expressly permitted to be given by telephone or electronically, all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by telecopy or e-mail, as follows:
(a) if to any Loan Party, to it at 1830 Route 130, Burlington, New Jersey 08016, Attention: Legal Department (Telecopy No. (609) 239-9675) (E-Mail: paul.tang@coat.com), with copies to Bain
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Capital Partners, LLC, 111 Huntington Avenue, Boston, Massachusetts 02199, Attention: David Humphrey (Telecopy No. (617) 516-2010) (E Mail: dhumphrey@baincapital.com), and Kirkland & Ellis LLP, 300 North LaSalle Street, Chicago, Illinois 60654, Attention: Linda K. Myers, P.C. (Telecopy No. (312) 862-2200) (E Mail linda.myers@kirkland.com);
if to the Administrative Agent or the Collateral Agent to JPMorgan Chase Bank, N.A., 1111 Fannin St., Houston, TX 77002 Attention: Lisa McCants (Telecopy No. (713) 750-2956 (E-Mail: lisa.a.mccants@jpmchase.com) With copies to: JPMorgan Chase Bank, N.A., 270 Park Ave., New York, New York 10017, Attention: Jennifer Heard (Telecopy No. (646) 534-2274 (E-Mail: Jennifer.s.heard@jpmorgan.com), and to Cahill Gordon & Reindel LLP , 80 Pine Street, New York, New York 10005, Attention: Corey Wright (Telecopy No. (212) 378-2544) (E-Mail: cwright@cahill.com);
(b) if to any other Credit Party, to it at its address (or telecopy number or electronic mail address) set forth on the signature pages hereto or on any Assignment and Acceptance.
Notwithstanding the foregoing, any notice hereunder sent by e-mail shall be solely for the distribution of (i) routine communications such as financial statements and (ii) documents and signature pages for execution by the parties hereto, and for no other purpose. Any party hereto may change its address or telecopy number for notices and other communications hereunder by notice to the other parties hereto. All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt.
SECTION 9.02 Waivers; Amendments .
(a) No failure or delay by any Credit Party in exercising any right or power hereunder or under any other Loan Document 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 Credit Parties hereunder and under the other Loan Documents are cumulative and are not exclusive of any other rights or remedies that they would otherwise have. No waiver of any provision of any Loan Document or consent to any departure by any Loan Party therefrom shall in any event be effective unless the same shall be permitted by SECTION 9.02(b), 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 Term Loan shall not be construed as a waiver of any Default or Event of Default, regardless of whether any Credit Party may have had notice or knowledge of such Default or Event of Default at the time.
(b) Except as otherwise specifically provided herein, neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended or modified except, in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by the Loan Parties and the Required Lenders or, in the case of any other Loan Document, pursuant to an agreement or agreements in writing entered into by the Agent(s) and the Loan Parties that are parties thereto, in each case with the consent of the Required Lenders; provided , however , that no such waiver, amendment, modification or other agreement shall:
(i) Increase the Commitment of any Lender without the prior written consent of such Lender (it being understood that a waiver of any condition precedent or of any Default or Event of Default or mandatory prepayment hereunder shall not constitute an increase of any Commitment of any Lender);
(ii) Without:
(A) the prior written consent of all Lenders directly affected thereby, reduce the principal amount of any Obligation or reduce the rate of interest thereon (other than the waiver of the Default Rate), or reduce any fees payable under the Loan Documents;
(B) the prior written consent of all Lenders directly affected thereby, postpone the scheduled date of payment of the principal amount of any Obligation, or any interest thereon, or reduce the amount of, waive or excuse any such payment, or postpone the Maturity Date (it being
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understood that the waiver of (or amendment to the terms of) any mandatory prepayment shall not constitute a postponement of any date scheduled for the payment of principal or interest or constitute a reduction, waiver or excuse of any payment of principal or interest);
(C) the prior written consent of all Lenders, except for Permitted Dispositions or for Collateral releases as provided in SECTION 8.16, release all or substantially all of the Collateral from the Liens of the Security Documents (it being understood that entering into any Pari Passu Intercreditor Agreement or incurring any Qualifying Secured Debt shall not constitute a release of all or substantially all of the Collateral from the Liens of the Security Documents);
(D) the prior written consent of all Lenders, except in connection with Permitted Dispositions or as provided in Section 6.03, release any Loan Party from its obligations under any Loan Document, or limit its liability in respect of such Loan Document;
(E) the prior written consent of all Lenders, change SECTION 2.17(a) or (b), SECTION 7.03, or, during the continuance of an Event of Default or following an exercise of remedies pursuant to Section 7.02, SECTION 8.03;
(F) the prior written consent of all Lenders, (i) subordinate the Obligations hereunder to any other Indebtedness, or (ii) except as provided by operation of Applicable Law or in the ABL Intercreditor Agreement, subordinate the Liens granted hereunder or under the other Loan Documents to any other Lien; or
(iii) the prior written consent of all Lenders, change any of the provisions of this SECTION 9.02(b) or the definition of “ Required Lenders .”
(c) Notwithstanding anything to the contrary contained in this SECTION 9.02:
(i) in the event that the Borrower shall request that this Agreement or any other Loan Document be modified, amended or waived in a manner which would require the consent of the Lenders pursuant to SECTION 9.02(b) and such amendment is approved by the Required Lenders, but not by the requisite percentage of the Lenders (other than the Required Lenders), the Borrower and the Administrative Agent shall be permitted to amend this Agreement without the consent of the Lender or Lenders which did not agree to the modification or amendment requested by the Borrower (such Lender or Lenders, collectively the “ Minority Lenders ”), provided that, with respect to each such Minority Lender, the Borrower shall, by giving written notice to Administrative Agent and such Minority Lender of its election to do so, elect to cause such Minority Lender (and such Minority Lender hereby irrevocably agrees) to assign its outstanding Term Loans in full to one or more Eligible Assignees (each a “ Replacement Lender ”) in accordance with the provisions of SECTION 9.04 and such Minority Lender shall pay any fees payable thereunder in connection with such assignment; provided further that (1) on the date of such assignment, the Replacement Lender shall pay to the Minority Lender an amount equal to the principal of, and all accrued interest on, all outstanding Term Loans of the Minority Lender; (2) on the date of such assignment, the Borrower shall pay any amounts payable to such Minority Lender pursuant to SECTIONS 2.14, 2.16(b) or 2.23 or otherwise as if it were a prepayment (and, if such Minority Lender is being removed in connection with an amendment that lowers the effective interest rates of the Term B Loan or modifies Section 2.19(d) prior to the one year anniversary of the Closing Date, the Borrower shall also pay to such Minority Lender a fee equal to 1.00% of the Term B Loan of such Minority Lender that is required to be so assigned); and (3) each Replacement Lender shall consent, at the time of such assignment, to each matter in respect of which such Minority Lender did not consent. In connection with any such replacement, if the Minority Lender does not execute and deliver to the Administrative Agent a duly completed Assigned and Acceptance and/or any other documentation necessary to reflect such replacement within a period of time deemed reasonably by the Administrative Agent as of the date on which the Replacement Lender executes such Assignment and Acceptance and/or such other documentation, then such Minority Lender shall be deemed to have executed and delivered such Assignment and Acceptance and/or such other documentation as of such date and the Borrower shall be entitled (but not obligated) to execute and deliver such Assignment and Acceptance and/or such documentation on behalf of such Minority Lender. Upon the prepayment of all
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amounts owing to any Minority Lender, such Minority Lender shall no longer constitute a “Lender” for purposes hereof; provided , any rights of such Minority Lender to indemnification hereunder shall survive as to such Minority Lender;
(ii) this Agreement may be amended (or amended and restated) with the written consent of the Required Lenders, the Administrative Agent and the Borrower (a) to add one or more additional credit facilities to this Agreement and to permit the extensions of credit from time to time outstanding thereunder and the accrued interest and fees in respect thereof to share ratably in the benefits of this Agreement and the other Loan Documents with the Term Loans and the accrued interest and fees in respect thereof and (b) to include appropriately the Lenders holding such credit facilities in any determination of the Required Lenders.
(iii) the Borrower and the Administrative Agent may without the input or consent of the Lenders, effect amendments to this Agreement and the other Loan Documents as may be necessary or appropriate in the reasonable opinion of the Administrative Agent to effect the provisions of SECTION 2.05 or 2.06 or to effect any refinancing or replacement of the Term Loans with any Refinancing Term Loans, Qualifying Secured Debt or Qualifying Unsecured Debt.
(iv) guarantees, collateral security documents and related documents executed by Subsidiaries in connection with this Agreement may be in a form reasonably determined by the Administrative Agent and may be, together with this Agreement, amended, supplemented and waived with the consent of the Administrative Agent at the request of the Borrower without the need to obtain the consent of any other Lender if such amendment, supplement or waiver is delivered in order (a) to comply with local Law or advice of local counsel, (b) to cure ambiguities, omissions, mistakes or defects or (c) to cause such guarantee, collateral security document or other document to be consistent with this Agreement and the other Loan Documents.
(v) if the Administrative Agent and the Borrower shall have jointly identified any obvious error or any error or omission of a technical or immaterial nature in any provision of the Loan Documents, then the Administrative Agent and the Borrower shall be permitted to amend such provision and 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 five Business Days following receipt of notice thereof.
(d) No notice to or demand on any Loan Party shall entitle any Loan Party to any other or further notice or demand in the same, similar or other circumstances. Each holder of a Note shall be bound by any amendment, modification, waiver or consent authorized as provided herein, whether or not a Note shall have been marked to indicate such amendment, modification, waiver or consent and any consent by a Lender, or any holder of a Note, shall bind any Person subsequently acquiring a Note, whether or not a Note is so marked. No amendment to this Agreement or any other Loan Document shall be effective against any Loan Party unless signed by such Loan Party.
SECTION 9.03 Expenses; Indemnity; Damage Waiver .
(a) The Loan Parties shall jointly and severally pay all Credit Party Expenses incurred as of the Closing Date on the Closing Date. Thereafter, the Loan Parties shall jointly and severally pay all Credit Party Expenses within thirty (30) days after receipt of an invoice therefor setting forth such expenses in reasonable detail; provided that in the event the Loan Parties have a bona fide dispute with any such expenses, payment of such disputed amounts shall not be required until the earlier of the date such dispute is resolved to the reasonable satisfaction of the Loan Parties or thirty (30) days after receipt of any such invoice (and any such disputed amount which is so paid shall be subject to a reservation of the Loan Parties’ rights with respect thereto).
(b) The Loan Parties shall, jointly and severally, indemnify the Secured Parties and each of their Subsidiaries and Affiliates, and each of the respective stockholders, directors, officers, employees, agents, attorneys, and advisors of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all damages, actual out-of-pocket losses, claims, actions, causes of action, settlement payments, obligations, liabilities and related expenses, including the reasonable fees, charges and disburse-
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ments of one counsel for the Agents and one counsel for all other Indemnitees (other than the Agents), incurred, suffered, sustained or required to be paid by, or asserted against, any Indemnitee arising out of, in any way connected with, or as a result of (i) the execution or delivery of any Loan Document or any other agreement or instrument contemplated hereby, the performance by the parties to the Loan Documents of their respective obligations thereunder or the consummation of the transactions contemplated by the Loan Documents or any other transactions contemplated hereby, (ii) any Term Loan or the use of the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property currently or formerly owned or operated by any Loan Party or any Subsidiary, or any Environmental Liability related in any way to any Loan Party or any Subsidiary, (iv) any actual or prospective claim, litigation, investigation or proceeding relating to or arising from any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto or (v) any documentary taxes, assessments or similar charges made by any Governmental Authority by reason of the execution and delivery of this Agreement or any other Loan Document; provided , however , that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (w) are determined by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from the gross negligence, bad faith or willful misconduct of any Agent or such Indemnitee or any Related Indemnitee of such Indemnitee or (x) are relating to disputes among Indemnitees (other than the Agents and Arrangers in their capacities as such and other than conduct involving a Loan Party) or (y) are determined by a court of competent jurisdiction or another independent tribunal having jurisdiction to have resulted from a material breach by such Indemnitee of its obligations under this Agreement. In connection with any indemnified claim hereunder, the Indemnitee shall be entitled to select its own counsel and the Loan Parties shall promptly pay the reasonable fees and expenses of such counsel.
(c) No party to this Agreement shall assert and, to the extent permitted by Applicable Law, each such party hereby waives, any claim against any other party to this Agreement or any Indemnitee, 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, any other Loan Document or any agreement or instrument contemplated hereby or thereby, the transactions contemplated by the Loan Documents, any Term Loan or the use of the proceeds thereof; provided that nothing in this paragraph (c) shall limit the Loan Parties’ indemnification obligations under SECTION 9.03(b) to any Indemnitee.
(d) The provisions of paragraphs (b) and (c) of this SECTION 9.03 shall remain operative and in full force and effect regardless of the termination of this Agreement, the consummation of the transactions contemplated hereby, the repayment of any of the Obligations, the invalidity or unenforceability of any term or provision of any Loan Document, or any investigation made by or on behalf of any Credit Party. All amounts due under this SECTION 9.03 shall be payable within thirty (30) days of written demand therefor, which written demand shall set forth such amounts in reasonable detail.
(e) For purposes of the foregoing, “ Related Indemnitee ” of an Indemnitee means (i) any controlling person or controlled affiliate of such Indemnitee involved in the negotiation and preparation of the Loan Documents, performing services under the Loan Documents or extending of credit or holding of credit hereunder and (ii) the respective directors, officers, partners, member, agents or employees of such Indemnitee or any of its controlling person or controlled affiliates involved in the negotiation and preparation of the Loan Documents, performing services under the Loan Documents or extending of credit or holding of credit hereunder.
SECTION 9.04 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 Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement.
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(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may assign to one or more Eligible Assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Term Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld, delayed or conditioned) of (A) the Borrower (which consent shall not be unreasonably withheld, delayed or conditioned); provided that if the Borrower does not respond to a request within 10 Business Days after receipt thereof, the Borrower will be deemed to have consented thereto), provided further that no consent of the Borrower shall be required for an assignment of a Term Loan to a Lender, an Affiliate of a Lender or an Approved Fund or, if an Event of Default under clauses (a) or (b) of SECTION 7.01 or under clauses (h) or (i) (in each case with respect to the Borrower) of SECTION 7.01 has occurred and is continuing and (B) the Administrative Agent, provided that no consent of the Administrative Agent shall be required for an assignment of all or any portion of a Term Loan to a Lender, an Affiliate of a Lender or an Approved Fund.
(ii) Assignments shall be subject to the following additional conditions:
(A) except in the case of an assignment to a Lender, an Affiliate of a Lender or an Approved Fund or an assignment of the entire remaining amount of the assigning Lender’s Term Loans of any Class, the amount of Loans of the assigning Lender subject to each such assignment (determined as of the trade date specified in the Assignment and Acceptance with respect to such assignment or, if no trade date is so specified, as of the date the Assignment and Acceptance with respect to such assignment is delivered to the Administrative Agent) shall not be less than $1,000,000, unless the Borrower and the Administrative Agent otherwise consent (such consent not to be unreasonably withheld, delayed or conditioned), provided that no such consent of the Borrower shall be required if an Event of Default under clauses (a) or (b) of SECTION 7.01 or under clauses (h) or (j) (in each case with respect to the Borrower) of SECTION 7.01 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 (B) shall not be construed to prohibit assignment of a proportionate part of all the assigning Lender’s rights and obligations in respect of one Class of Loans,
(C) the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Acceptance, together with a processing and recordation fee of $3,500, provided that assignments made pursuant to SECTION 9.02(c) shall not require the signature of the assigning Lender to become effective, provided , further , that only one such processing and recordation fee shall be payable in connection with simultaneous assignments to two or more assignees that are Affiliates of one another, or to two or more Approved Funds that are managed or advised by the same investment advisor,
(D) the assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire in which the assignee designates one or more credit contacts to whom all syndicate-level information (which may contain material non-public information about the Borrower and its Affiliates and their related parties or their respective securities) will be made available and who may receive such information in accordance with the assignee’s compliance procedures and applicable laws, including Federal and state securities laws and any tax forms required by SECTION 2.23(e),
(E) No assignment shall be made to any member of the Sponsor Group (other than an Investment Fund) except in accordance with clause (f) below and no member of the Sponsor Group (other than an Investment Fund) may assign any Term Loans except in compliance with the requirements of this clause (b) and the requirements of paragraph (f)(i)(x) and (f)(i)(y) below, and
(F) the Borrower shall, upon reasonable request by the Administrative Agent, provide such documentation to the Administrative Agent in connection with any assignment by a Lender to an assignee that bears a relationship to the Borrower under Section 108(e)(4) of the Code, so as to allow the Administrative Agent to determine whether the assigned portion of the Loan will have original issue discount for U.S. federal income tax purposes and, if so, the amount of such original issue discount.
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(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 Acceptance, the assignee thereunder shall be a party hereto and, to the extent of the interest assigned by such Assignment and Acceptance, 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 Acceptance, be released from its obligations under this Agreement (and, in the case of an Assignment and Acceptance 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 2.14, 2.23, 2.24 and 9.03, subject to the limitations and requirements of those Sections including documentation requirements in Section 2.23, and entitled to any fees payable hereunder that have accrued for such Lender’s account but have not yet been paid). Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this Section shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with paragraph (c)(i) of this Section.
(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 Acceptance delivered to it and a register for the recordation of the names and addresses of the Lenders and principal amount (and related interest amounts) 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 Loan Parties, 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, at any reasonable time and from time to time upon reasonable prior notice.
(v) Upon its receipt of a duly completed Assignment and Acceptance executed by an assigning Lender and an assignee, the assignee’s completed Administrative Questionnaire and any tax forms required by SECTION 2.23(e) and 2.23(j) (unless the assignee shall already be a Lender hereunder), the processing and recordation fee referred to in paragraph (b)(ii) of this Section and any written consent to such assignment required by paragraph (b)(i) of this Section, the Administrative Agent shall accept such Assignment and Acceptance 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.
(vi) The words “execution”, “signed”, “signature” and words of like import in any Assignment and Acceptance shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act or any other similar state laws based on the Uniform Electronic Transactions Act.
(c) (i) Any Lender may, without the consent of the Borrower or the Administrative Agent, sell participations to one or more banks or other entities (a “ Participant ”) other than to the Borrower or any of its Affiliates (other than (i) Investment Funds and (ii) other than to a member of the Sponsor Group to the extent the terms of such participation comply with the requirements applicable to an assignment to a member of the Sponsor Group and for purposes of this paragraph (c) and paragraph (f) below, any Term Loans in which a member of the Sponsor Group holds a participating interest shall be subject to the 15% limitation set forth in paragraph (f)(i)(z) below and shall be treated as held directly by such member of the Sponsor Group for purposes of such paragraph; provided that (A) any Lender who sells a participation to a member of the Sponsor Group shall notify the Agent of the terms thereof and (B) no member of the Sponsor Group (other than an Investment Fund) shall sell a participation unless the conditions set forth in paragraph (f)(i)(x) below are satisfied) in all or a portion of such Lender’s rights and obligations under this Agreement (including all or a portion of 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 Loan Parties, the Administrative Agent and the other Lenders shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement. Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce the Loan Documents and to approve any amendment, modification or waiver of any provision of the 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 clause (i), (ii) or (iii) of the first proviso to SECTION 9.02(b) that affects such
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Participant. Subject to paragraph (c)(ii) of this Section, the Borrower agrees that each Participant shall be entitled to the benefits of SECTIONS 2.14, 2.23 and 2.24 to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to paragraph (b) of this Section. To the extent permitted by law, each Participant also shall be entitled to the benefits of SECTION 9.08 as though it were a Lender. Each Lender that sells a participation, acting solely for this purpose as a non-fiduciary agent of the Borrower (solely for tax purposes), shall maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under this Agreement (the “ Participant Register ”); provided that no Lender shall have any obligation to disclose all or any portion of the Participant Register to any Person (including the identity of any Participant or any information relating to a Participant’s interest in any Term Loan or its other obligations under any Loan Document) except to the extent that such disclosure is necessary to establish that such Commitment, Term Loan 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, and such Lender, each Loan Party and the Administrative Agent shall treat each person whose name is recorded in the Participant Register pursuant to the terms hereof as the owner of such participation for all purposes of this Agreement, notwithstanding notice to the contrary.
(i) A Participant shall not be entitled to receive any greater payment under SECTION 2.14 or Section 2.23 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with the Borrower’s prior written consent or the right to receive a greater payment results from a Change in Law after the participant becomes a Participant. A Participant shall not be entitled to the benefits of SECTION 2.23 unless the Borrower is notified of the participation sold to such Participant and such Participant agrees, for the benefit of the Borrower, to comply with SECTION 2.23 as though it were a Lender.
(d) Any Lender may, without the consent of the Borrower or the Administrative Agent, 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 any pledge or assignment to secure obligations to a Federal Reserve Bank, 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) Notwithstanding anything to the contrary contained herein, any Lender (a “ Granting Lender ”) may grant to a special purpose funding vehicle (an “ SPV ”), identified as such in writing from time to time by the Granting Lender to the Administrative Agent and the Borrower, the option to provide to the Borrower all or any part of any Term Loan that such Granting Lender would otherwise be obligated to make to the Borrower pursuant to this Agreement, provided that (i) nothing herein shall constitute a commitment by any SPV to make any Term Loan and (ii) if an SPV elects not to exercise such option or otherwise fails to provide all or any part of such Term Loan, the Granting Lender shall be obligated to make such Term Loan pursuant to the terms hereof. The making of a Term Loan by an SPV hereunder shall utilize the Commitment of the Granting Lender to the same extent, and as if, such Term Loan were made by such Granting Lender. Each party hereto hereby agrees that no SPV shall be liable for any indemnity or similar payment obligation under this Agreement (all liability for which shall remain with the Granting Lender). In furtherance of the foregoing, each party hereto hereby agrees (which agreement shall survive the termination of this Agreement) that, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper or other senior indebtedness of any SPV, such party will not institute against, or join any other person in instituting against, such SPV any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings under the laws of the United States or any State thereof. In addition, notwithstanding anything to the contrary contained in this Section 9.04, any SPV may (i) with notice to, but without the prior written consent of, the Borrower and the Administrative Agent and without paying any processing fee therefor, assign all or a portion of its interests in any Term Loan to the Granting Lender or to any financial institutions (consented to by the Borrower and Administrative Agent) providing liquidity or credit support to or for the account of such SPV to support the funding or maintenance of Term Loans and (ii) disclose on a confidential basis any non-public information relating to its Term Loans to any rating agency, commercial paper dealer or provider of any surety, guarantee or credit or liquidity enhancement to such SPV.
(f) (i) Notwithstanding SECTION 9.04(b), any Lender may assign all or a portion of its Term Loans to a member of the Sponsor Group (other than a natural person) in accordance with this SECTION 9.04(f) (and any
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member of the Sponsor Group (other than any Investment Fund) shall not assign any Term Loan pursuant to SECTION 9.04(b) above or acquire a participation in a Term Loan or sell a participation in its Term Loans unless the conditions set forth in subparagraph (x) and, solely in the case of an assignment, subparagraph (y) below are satisfied); provided that:
(x) except as previously disclosed in writing to the Administrative Agent and the Lenders, such member of the Sponsor Group represents and warrants as of the date of any assignment or participation to or from such member of the Sponsor Group pursuant to this SECTION 9.04, that no member of the Sponsor Group has any MNPI;
(y) the assigning Lender or the Lender to whom such assignment is being made, as the case may be, and the member of the Sponsor Group (other than any Investment Fund) purchasing such Lender’s Term Loans or assigning Term Loans to such Lender, as applicable, shall execute and deliver to the Administrative Agent an assignment agreement substantially in the form of Exhibit K hereto (an “ Affiliated Lender Assignment and Acceptance ”) in lieu of an Assignment and Acceptance; and
(z) no Loan may be assigned to a member of the Sponsor Group (other than any Investment Fund) pursuant to this SECTION 9.04(f), if after giving effect to such assignment, the members of the Sponsor Group (other than any Investment Fund) in the aggregate would own (or hold participations in) in excess of 15% of all Term Loans of any Class then outstanding.
(i) Notwithstanding anything to the contrary in this Agreement, no member of the Sponsor Group (other than any Investment Fund) shall have any right to (a) attend (including by telephone) any meeting or discussions (or portion thereof) among the Administrative Agent or any Lender to which representatives of the Loan Parties are not invited, (b) receive any information or material prepared by Administrative Agent or any Lender or any communication by or among Administrative Agent and/or one or more Lenders, except to the extent such information or materials have been made available to any Loan Party or its representatives (and in any case, other than the right to receive notices of prepayments and other administrative notices in respect of its Loans required to be delivered to Lenders pursuant to ARTICLE II), or (c) make or bring (or participate in, other than as a passive participant in or recipient of its pro rata benefits of) any claim, in its capacity as a Lender, against the Administrative Agent, the Collateral Agent or any other Lender with respect to any duties or obligations or alleged duties or obligations of such Agent or any other such Lender under the Loan Documents.
(ii) Notwithstanding anything in SECTION 9.01 or the definition of “Required Lenders” to the contrary, for purposes of determining whether the Required Lenders have (a) consented (or not consented) to any amendment, modification, waiver, consent or other action with respect to any of the terms of any Loan Document or any departure by any Loan Party therefrom, (b) otherwise acted on any matter related to any Loan Document, or (c) directed or required the Administrative Agent, Collateral Agent or any Lender to undertake any action (or refrain from taking any action) with respect to or under any Loan Document all Loans held by any member of the Sponsor Group (other than an Investment Fund) shall be deemed to be not outstanding for all purposes of calculating whether the Required Lenders have taken any actions.
(iii) Additionally, if there is any assignment of any Loan pursuant to this SECTION 9.04(f), each Loan Party and each member of the Sponsor Group (other than any Investment Fund) that becomes a Lender hereunder hereby agree that if a case under Title 11 of the United States Code is commenced against any Loan Party, such Loan Party shall seek (and each such member of the Sponsor Group (other than any Investment Fund) shall consent) to provide that the vote of any member of the Sponsor Group (other than any Investment Fund) (in its capacity as a Lender) with respect to any plan of reorganization of such Loan Party shall not be counted except that any member of the Sponsor Group’s (other than any Investment Fund) vote (in its capacity as a Lender) may be counted to the extent any such plan of reorganization proposes to treat the Obligations held by such member of the Sponsor Group (other than any Investment Fund) in a manner that is less favorable in any material respect to such member of the Sponsor Group (other than any Investment Fund) than the proposed treatment of similar Obligations held by Lenders that are not Affiliates of the Borrower. Each member of the Sponsor Group (other than any Investment Fund) that becomes a Lender hereby irrevocably appoints the Administrative Agent (such appointment being coupled with an interest) as such Person’s attorney-in-fact, with full authority in the place and stead of such member of the Sponsor Group (other than any Investment Fund) and in the name of such member of the Sponsor Group (other than any
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Investment Fund), from time to time in the Administrative Agent’s discretion to take any action and to execute any instrument that the Administrative Agent may deem reasonably necessary to carry out the provisions of this paragraph.
SECTION 9.05 Survival . All covenants, agreements, indemnities, representations and warranties made by the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any Term Loans, regardless of any investigation made by any such other party or on its behalf and, notwithstanding that any Credit Party may have had notice or knowledge of any Default or Event of Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full force and effect until (i) the Commitments have expired or been terminated and (ii) the principal of and interest on each Term Loan and all fees and other Obligations (other than contingent indemnity obligations with respect to then unasserted claims) shall have been paid in full. The provisions of SECTION 2.14, SECTION 2.23, SECTION 9.03 and Article VIII shall survive and remain in full force and effect regardless of the repayment of the Obligations, the expiration or termination of the Commitments or the termination of this Agreement or any provision hereof. In connection with the termination of this Agreement and the release and termination of the security interests in the Collateral, the Agents, on behalf of themselves and the other Credit Parties, may require such indemnities as they shall reasonably deem necessary or appropriate to protect the Credit Parties against loss on account of credits previously applied to the Obligations that may subsequently be reversed or revoked.
SECTION 9.06 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 and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all contemporaneous or previous agreements and understandings, oral or written, relating to the subject matter hereof. Except as provided in SECTION 4.01, this Agreement shall become effective when it shall have been executed by the applicable Credit Parties and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto, 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 telecopy or e-mail shall be effective as delivery of a manually executed counterpart of this Agreement.
SECTION 9.07 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 9.08 Right of Setoff . If any Specified Default shall have occurred and be continuing, each Secured Party, each Participant and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to setoff and apply any and all deposits (general or special, time or demand, provisional or final, but excluding any payroll, trust and tax withholding accounts) at any time held and other obligations at any time owing by such Secured Party, Participant or Affiliate to or for the credit or the account of the Loan Parties against any and all of the Obligations of the Loan Parties now or hereafter existing under this Agreement or other Loan Document to the extent such are then due and owing, although such Obligations may be otherwise fully secured; provided that such Secured Party shall provide the Borrower with written notice promptly after its exercise of such right of setoff. The rights of each Secured Party under this SECTION 9.08 are in addition to other rights and remedies (including other rights of setoff) that such Credit Party may have. No Credit Party will, or will permit its Participant to, exercise its rights under this SECTION 9.08 without the consent of the Administrative Agent or the Required Lenders. ANY AND ALL RIGHTS TO REQUIRE THE COLLATERAL AGENT TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL WHICH SECURES ANY OF THE OBLIGATIONS PRIOR TO THE EXERCISE BY ANY SECURED PARTY, PARTICIPANT OR AFFILIATE OF ITS RIGHT OF SETOFF UNDER THIS SECTION ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.
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Section 9.09 Governing Law; Jurisdiction; Consent to Service of Process .
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
(b) Each Loan Party agrees that any suit for the enforcement of this Agreement or any other Loan Document may be brought in the courts of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as the Administrative Agent may elect in its sole discretion and consents to the non-exclusive jurisdiction of such courts. Each party to this Agreement hereby waives any objection which it may now or hereafter have to the venue of any such suit or any such court or that such suit is brought in an inconvenient forum and agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that any Credit Party may otherwise have to bring any action or proceeding relating to this Agreement against a Loan Party or its properties in the courts of any jurisdiction.
(c) Each Loan Party agrees that any action commenced by any Loan Party asserting any claim or counterclaim arising under or in connection with this Agreement or any other Loan Document shall be brought solely in a court of the State of New York sitting in the Borough of Manhattan or any federal court sitting therein as the Administrative Agent may elect in its sole discretion and consents to the exclusive jurisdiction of such courts with respect to any such action.
(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 or any other Loan Document will affect the right of any party to this Agreement to serve process in any other manner permitted by law.
SECTION 9.10 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, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY); AND WAIVES DUE DILIGENCE, DEMAND, PRESENTMENT AND PROTEST AND ANY NOTICES THEREOF AS WELL AS NOTICE OF NONPAYMENT. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS, AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.
SECTION 9.11 Press Releases and Related Matters . The Borrower consents to the publication by the Administrative Agent of customary trade advertising material in tombstone format relating to the financing transactions contemplated by this Agreement using the Borrower’s name, and with the consent of the Borrower, logo or trademark. The Administrative Agent shall provide a draft reasonably in advance of any advertising material to the Borrower for review and comment prior to the publication thereof. The Administrative Agent reserves the right to provide to industry trade organizations information necessary and customary for inclusion in league table measurements.
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 Interest Rate Limitation . Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Term Loan, together with all fees, charges and other amounts that are treated as interest on such Term Loan under Applicable Law (collectively, the “ Charges ”), shall be found by a court of competent jurisdiction in a final order to exceed the maximum lawful rate (the “ Maximum Rate ”) that may be contracted for, charged, taken, received or reserved by the Lender holding such Term Loan in accordance with Applicable Law, the rate of interest payable in respect of such Term Loan hereunder, together with all Charges payable in respect
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thereof, shall be limited to the Maximum Rate and, to the extent lawful, the interest and Charges that would have been payable in respect of such Term Loan but were not payable as a result of the operation of this Section shall be cumulated and the interest and Charges payable to such Lender in respect of other Term Loans or periods shall be increased (but not above the Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.
SECTION 9.14 Additional Waivers .
(a) The Obligations are the joint and several obligation of each Loan Party. To the fullest extent permitted by Applicable Law, the obligations of each Loan Party hereunder shall not be affected by (i) the failure of any Credit Party to assert any claim or demand or to enforce or exercise any right or remedy against any other Loan Party under the provisions of this Agreement, any other Loan Document or under Applicable Law, (ii) any rescission, waiver, amendment or modification of, or any release of any Loan Party from, any of the terms or provisions of, this Agreement, any other Loan Document, or (iii) the failure to perfect any security interest in, or the release of, any of the Collateral or other security held by or on behalf of the Collateral Agent or any other Credit Party.
(b) The obligations of each Loan Party to pay the Obligations in full hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason (other than the payment in full in cash of the Obligations after the termination of all Commitments to the Borrower under any Loan Document), including any claim of waiver, release, surrender, alteration or compromise of any of the Obligations, and shall not be subject to any defense or setoff, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality or unenforceability of any of the Obligations or otherwise. Without limiting the generality of the foregoing, the obligations of each Loan Party hereunder shall not be discharged or impaired or otherwise affected by the failure of the Administrative Agent or any other Credit Party to assert any claim or demand or to enforce any remedy under this Agreement, any other Loan Document or any other agreement, by any waiver or modification of any provision of any thereof, any default, failure or delay, willful or otherwise, in the performance of any of the Obligations, or by any other act or omission that may or might in any manner or to any extent vary the risk of any Loan Party or that would otherwise operate as a discharge of any Loan Party as a matter of law or equity (other than the payment in full in cash of all the Obligations after termination of all Commitments to any Loan Party under any Loan Document).
(c) To the fullest extent permitted by Applicable Law, each Loan Party waives any defense based on or arising out of any defense of any other Loan Party or the unenforceability of the Obligations or any part thereof from any cause, or the cessation from any cause of the liability of any other Loan Party, other than the payment in full in cash of all the Obligations after the termination of all Commitments to any Loan Party under any Loan Document. The Collateral Agent and the other Credit Parties may, at their election, foreclose on any security held by one or more of them by one or more judicial or nonjudicial sales, accept an assignment of any such security in lieu of foreclosure, compromise or adjust any part of the Obligations, make any other accommodation with any other Loan Party, or exercise any other right or remedy available to them against any other Loan Party, without affecting or impairing in any way the liability of any Loan Party hereunder except to the extent that all the Obligations have been indefeasibly paid in full in cash and performed in full after the termination of Commitments to any Loan Party under any Loan Document. Pursuant to Applicable Law, each Loan Party waives any defense arising out of any such election even though such election operates, pursuant to Applicable Law, to impair or to extinguish any right of reimbursement or subrogation or other right or remedy of such Loan Party against any other Loan Party, as the case may be, or any security.
(d) Without limiting the generality of the foregoing, or of any other waiver or other provision set forth in this Agreement, each Loan Party waives all rights and defenses arising out of an election of remedies by any Credit Party, even though that election of remedies, such as a nonjudicial foreclosure with respect to security for a guaranteed obligation, has destroyed such Credit Party’s rights of subrogation and reimbursement against such Loan Party by the operation of Section 580(d) of the California Code of Civil Procedure or otherwise. Each Loan Party waives all rights and defenses that such Loan Party may have because the Obligations are secured by Real Estate which means, among other things: (i) a Credit Party may collect from any Loan Party without first foreclosing on any Real Estate or personal property Collateral pledged by a Loan Party; (ii) if any Credit Party forecloses on any Real Estate pledged by any Loan Party, the amount of the Obligations may be reduced only by the price for which that Real Estate is sold at the foreclosure sale, even if the Real Estate is worth more than the sale price; and (iii) the Credit Parties may collect Obligations from a Loan Party even if a Credit Party, by foreclosing on any such Real
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Estate, has destroyed any right any Loan Party may have to collect from the other Loan Parties. This is an unconditional and irrevocable waiver of any rights and defenses any Loan Party may have because the Obligations are secured by Real Estate. These rights and defenses include, but are not limited to, any rights or defenses based upon Section 580a, 580b, 580d or 726 of the California Code of Civil Procedure. Each Loan Party hereby absolutely, knowingly, unconditionally, and expressly waives any and all claim, defense or benefit arising directly or indirectly under any one or more of Sections 2787 to 2855 inclusive of the California Civil Code or any similar law of California.
(e) Each Loan Party hereby agrees to keep each other Loan Party fully apprised at all times as to the status of its business, affairs, finances, and financial condition, and its ability to perform its Obligations under the Loan Documents, and in particular as to any adverse developments with respect thereto. Each Loan Party hereby agrees to undertake to keep itself apprised at all times as to the status of the business, affairs, finances, and financial condition of each other Loan Party, and of the ability of each other Loan Party to perform its Obligations under the Loan Documents, and in particular as to any adverse developments with respect to any thereof. Each Loan Party hereby agrees, in light of the foregoing mutual covenants to inform each other, and to keep themselves and each other informed as to such matters, that the Credit Parties shall have no duty to inform any Loan Party of any information pertaining to the business, affairs, finances, or financial condition of any other Loan Party, or pertaining to the ability of any other Loan Party to perform its Obligations under the Loan Documents, even if such information is adverse, and even if such information might influence the decision of one or more of the Loan Parties to continue to be jointly and severally liable for, or to provide Collateral for, the Obligations of one or more of the other Loan Parties. To the fullest extent permitted by applicable law, each Loan Party hereby expressly waives any duty of the Credit Parties to inform any Loan Party of any such information.
SECTION 9.15 Confidentiality . Each of the Credit Parties agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to their and their Affiliates’ directors, officers, employees and agents, including accountants, legal counsel and other advisors involved with the financing (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such Information and agree to keep such Information confidential), (b) to the extent requested by any regulatory authority, (c) to the extent required by Applicable Laws or by any subpoena or similar legal process (the Credit Parties’ agreeing to furnish the Borrower with notice of such process and an opportunity to contest such disclosure as long as furnishing such notice and opportunity would not result in the Credit Parties’ violation of Applicable Law), (d) to any other party to this Agreement, (e) in connection with the exercise of any remedies hereunder 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, or not less favorable to the Borrower than, those of this Section, to any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement and any actual or prospective counterparty or advisors to any swap or derivative transactions relating to the Loan Parties and the Obligations so long as such Person or any of their Affiliates is not a competitor of any Loan Party, (g) with the consent of the Loan Parties, (h) to the extent such Information (i) becomes publicly available other than as a result of a breach of this Section, or to the knowledge of such Credit Party, the breach of any other Person’s obligation to keep the information confidential, or (ii) becomes available to any Credit Party on a nonconfidential basis from a source other than the Loan Parties, or (i) to the extent that such Information is independently developed by such Credit Party. For the purposes of this Section, the term “Information” means all information received from or on behalf of the Loan Parties or any of their Affiliates relating to their business. 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 accord to its own confidential information.
SECTION 9.16 Patriot Act . Each Lender 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 required to obtain, verify and record information that identifies the Borrower, which information includes the name and address of such Borrower and other information that will allow such Lender to identify such Borrower in accordance with the Act. The Borrower is in compliance, in all material respects, with the Act. No part of the proceeds of the Term Loans will be used by the Loan Parties, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an
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official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.
SECTION 9.17 Foreign Asset Control Regulations . Neither of the advance of the Term Loans nor the use of the proceeds of any thereof will violate the Trading With the Enemy Act (50 U.S.C. § 1 et seq., as amended) (the “ Trading With the Enemy Act ”) or any of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) (the “ Foreign Assets Control Regulations ”) or any enabling legislation or executive order relating thereto (which for the avoidance of doubt shall include, but shall not be limited to (a) Executive Order 13224 of September 21, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit, or Support Terrorism (66 Fed. Reg. 49079 (2001)) (the “ Executive Order ”) and (b) the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56)). Furthermore, none of the Borrower or its Affiliates (a) is or will become a “blocked person” as described in the Executive Order, the Trading With the Enemy Act or the Foreign Assets Control Regulations or (b) knowingly engages or will engage in any dealings or transactions, or be otherwise associated, with any such “blocked person” or in any manner violative of any such order.
SECTION 9.18 Intercreditor Agreements . The Loan Parties, the Agents, the Lenders and the other Credit Parties acknowledge that the exercise of certain of the Agents’ rights and remedies hereunder may be subject to, and restricted by, the provisions of the Intercreditor Agreements. Except as specified herein, nothing contained in the Intercreditor Agreements shall be deemed to modify any of the provisions of this Agreement and the other Loan Documents, which, as among the Loan Parties, the Agents, the Lenders and the other Credit Parties shall remain in full force and effect.
SECTION 9.19 No Advisory or Fiduciary Responsibility . In connection with all aspects of each transaction contemplated hereby (including in connection with any amendment, waiver or other modification hereof or of any other Loan Document), each of the Loan Parties acknowledges and agrees that (i) (A) the arranging and other services regarding this Agreement provided by the Agents and the Arrangers, are arm’s-length commercial transactions between the Loan Parties and their respective Subsidiaries, on the one hand, and the Agents and the Arrangers, on the other hand, (B) each of the Loan Parties has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, and (C) each of Loan Parties is capable of evaluating, and understands and accepts, the terms, risks and conditions of the transactions contemplated hereby and by the other Loan Documents; (ii) (A) each Agent and each Arranger is and has been acting solely as a principal and, except as expressly agreed in writing by the relevant parties, has not been, is not, and will not be acting as an advisor, agent or fiduciary for the Loan Parties or any of their respective Subsidiaries, or any other Person and (B) neither any Agent nor any Arranger has any obligation to the Loan Parties or any of their respective Subsidiaries with respect to the transactions contemplated hereby except those obligations expressly set forth herein and in the other Loan Documents; and (iii) the Agents, the Arrangers and their respective Subsidiaries may be engaged in a broad range of transactions that involve interests that differ from those of the Loan Parties and their respective Subsidiaries, and neither any Agent nor any Arranger has any obligation to disclose any of such interests to the Loan Parties or any of their respective Subsidiaries. To the fullest extent permitted by law, each of the Loan Parties hereby waives and releases any claims that it may have against the Agents and the Arrangers with respect to any breach or alleged breach of agency or fiduciary duty in connection with any aspect of any transaction contemplated hereby.
[SIGNATURE PAGES FOLLOW]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as a sealed instrument as of the day and year first above written.
|
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION,
as Borrower |
||
| By: | Robert LaPenta, Jr. | |
| Name: Robert LaPenta, Jr. | ||
| Title: Vice President and Treasurer | ||
|
BURLINGTON COAT FACTORY HOLDINGS, INC., as a Facility Guarantor |
||
| By: | Robert LaPenta, Jr. | |
| Name: Robert LaPenta, Jr. | ||
| Title: Vice President and Treasurer | ||
|
BURLINGTON COAT FACTORY INVESTMENT HOLDINGS, INC., as a Facility Guarantor |
||
| By: | Robert LaPenta, Jr. | |
| Name: Robert LaPenta, Jr. | ||
| Title: Vice President and Treasurer | ||
|
EACH OF THE SUBSIDIARIES LISTED ON ANNEX A HERETO, as Facility Guarantors |
||
| By: | Robert LaPenta, Jr. | |
| Name: Robert LaPenta, Jr. | ||
| Title: Vice President and Treasurer | ||
|
JPMORGAN CHASE BANK, N.A., as Administrative Agent, as Collateral Agent and as a Lender |
||
| By: | /s/ Jennifer Heard | |
| Name: Jennifer Heard | ||
| Title: Vice President | ||
ANNEX A
Facility Guarantors
Burlington Coat Factory of Alabama, LLC
Burlington Coat Factory Warehouse of Anchorage, Inc.
Burlington Coat Factory of Arizona, LLC
Burlington Coat Factory of Arkansas, LLC
Baby Depot of California, LLC
Burlington Coat Factory of California, LLC
Burlington Coat Factory of San Bernardino, LLC
MJM Designer Shoes of California, LLC
Burlington Coat Factory of Colorado, LLC
Burlington Coat Factory of Connecticut, LLC
Cohoes Fashions of Connecticut, LLC
Burlington Coat Factory of Delaware, LLC
Burlington Coat Factory of Texas, L.P.
MJM Designer Shoes of Delaware, LLC
Burlington Coat Factory of Florida, LLC
MJM Designer Shoes of Florida, LLC
Burlington Coat Factory of Georgia, LLC
Burlington Coat Factory Warehouse of Atlanta, Inc.
Burlington Coat Factory of Hawaii, LLC
Burlington Coat Factory of Idaho, LLC
Burlington Coat Factory of Illinois, LLC
Burlington Coat Factory Warehouse of East St. Louis, Inc.
Burlington Coat Factory of Indiana, LLC
Burlington Coat Factory of Iowa, LLC
Burlington Coat Factory of Kansas, LLC
Burlington Coat Factory of Kentucky, Inc.
Burlington Coat Factory of Louisiana, LLC
Burlington Coat Factory of Maine, LLC
Burlington Coat Factory of Maryland, LLC
Burlington Coat Factory of Massachusetts, LLC
Cohoes Fashions of Massachusetts, LLC
Burlington Coat Factory of Michigan, LLC
Burlington Coat Factory Warehouse of Detroit, Inc.
Burlington Coat Factory Warehouse of Redford, Inc.
Burlington Coat Factory Warehouse of Grand Rapids, Inc.
Burlington Coat Factory of Minnesota, LLC
Burlington Coat Factory of Mississippi, LLC
Burlington Coat Factory of Missouri, LLC
Burlington Coat Factory of Montana, LLC
Burlington Coat Factory of Nebraska, LLC
Burlington Coat Factory of Nevada, LLC
Burlington Coat Factory of New Hampshire, LLC
Burlington Coat Factory Direct Corporation
Burlington Coat Factory of New Jersey, LLC
Burlington Coat Factory Warehouse of Edgewater Park, Inc.
Burlington Coat Factory Warehouse of New Jersey, Inc.
Cohoes Fashions of New Jersey, LLC
MJM Designer Shoes of Moorestown, Inc.
MJM Designer Shoes of New Jersey, LLC
Super Baby Depot of Moorestown, Inc.
Burlington Coat Factory of New Mexico, LLC
Burlington Coat Factory of New York, LLC
Georgetown Fashions Inc.
Monroe G. Milstein, Inc.
Cohoes Fashions of New York, LLC
MJM Designer Shoes of New York, LLC
Burlington Coat Factory of North Carolina, LLC
Burlington Coat Factory of North Dakota, LLC
Burlington Coat Factory of Ohio, LLC
Burlington Coat Factory Warehouse of Cleveland, Inc.
Burlington Coat Factory of Oklahoma, LLC
Burlington Coat Factory of Oregon, LLC
Burlington Coat Factory Warehouse of Bristol, LLC
Burlington Coat Factory of Pennsylvania, LLC
Burlington Coat Factory Warehouse of Montgomeryville, Inc.
Burlington Coat Factory Warehouse of Cheltenham, Inc.
Burlington Coat Factory Warehouse of Langhorne, Inc.
Burlington Factory Warehouse of Reading, Inc.
Burlington Coat Factory Warehouse Inc.
MJM Designer Shoes of Pennsylvania, LLC
Burlington Coat Factory of Puerto Rico, LLC
Burlington Coat Factory of Rhode Island, LLC
Cohoes Fashions of Cranston, Inc.
Burlington Coat Factory of South Carolina, LLC
Burlington Coat Factory Warehouse of Charleston, Inc.
Burlington Coat Factory of South Dakota, LLC
Burlington Coat Factory Warehouse of Memphis, Inc.
Burlington Coat Factory Warehouse of Shelby, Inc.
Burlington Coat Factory Warehouse of Hickory Commons, Inc.
Burlington Coat Factory Warehouse of Baytown, Inc.
MJM Designer Shoes of Texas, Inc.
Burlington Coat Factory of Utah, LLC
Burlington Coat Factory of Vermont, LLC
Burlington Coat Factory of Virginia, LLC
Burlington Coat Factory of Pocono Crossing, LLC
BCF Cards, Inc.
Burlington Coat Factory Warehouse of Coliseum, Inc.
Burlington Coat Factory of Washington, LLC
Burlington Coat Factory of West Virginia, LLC
Burlington Coat Factory of Wisconsin, LLC
Burlington Coat Factory Realty of Huntsville, LLC
Burlington Coat Factory Realty of Mesa, Inc.
Burlington Coat Factory Realty of Desert Sky, Inc.
Burlington Coat Factory Realty of Dublin, Inc.
Burlington Coat Factory Realty of Florin, Inc.
Burlington Coat Factory Realty of Ventura, Inc.
Burlington Coat Factory Realty of East Windsor, Inc.
Burlington Coat Factory of Texas, Inc.
C.F.I.C. Corporation
Burlington Coat Factory Realty Corp.
Burlington Coat Factory Realty of University Square, Inc.
Burlington Coat Factory Realty of Coral Springs, Inc.
Burlington Coat Factory Realty of West Colonial, Inc.
Burlington Coat Factory Realty of Orlando, Inc.
Burlington Coat Factory Realty of Sarasota, Inc.
K&T Acquisition Corp.
Bee Ridge Plaza, LLC
Burlington Coat Factory Realty of Morrow, Inc.
Burlington Coat Realty of Gurnee, Inc.
Burlington Coat Factory Realty of Bloomingdale, Inc.
Burlington Coat Factory Realty of River Oaks, Inc.
Burlington Coat Factory Realty of Greenwood, Inc.
Burlington Coat Factory Realty of North Attleboro, Inc.
Burlington Coat Factory Realty of Des Peres, Inc.
Burlington Coat Realty of Las Vegas, Inc.
Burlington Coat Factory Realty of Edgewater Park, Inc.
Burlington Coat Factory Realty of Paramus, Inc.
Burlington Coat Factory Realty of Pinebrook, Inc.
Burlington Coat Factory Warehouse of Edgewater Park Urban Renewal Corp.
Burlington Coat Factory Realty of Yonkers, Inc.
LC Acquisition Corp.
Burlington Coat Factory Realty of Tulsa, Inc.
Burlington Coat Factory Realty of West Mifflin, Inc.
Burlington Coat Factory Realty of Langhorne, Inc.
Burlington Coat Factory Realty of Whitehall, Inc.
Burlington Coat Factory Realty of Memphis, Inc.
Burlington Coat Realty of Plano, Inc.
Burlington Coat Realty of Houston, Inc.
Burlington Coat Factory Realty of Westmoreland, Inc.
Burlington Coat Factory Realty of Bellaire, Inc.
Burlington Coat Factory Realty of El Paso, Inc.
Burlington Coat Realty of Potomac, Inc.
Burlington Coat Factory Realty of Fairfax, Inc.
Burlington Coat Factory Realty of Coliseum, Inc.
Burlington Coat Factory Realty of Franklin, Inc.
Exhibit 10.3
FIRST AMENDMENT AND CONSENT TO
CREDIT AGREEMENT
This First Amendment and Consent to Credit Agreement (the “ First Amendment ”) is made as of the 24 th day of February, 2011 by and among
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION, a corporation organized under the laws of the State of Delaware having a place of business at 1830 Route 130, Burlington, New Jersey 08016, as Lead Borrower for itself and the other Borrowers;
the BORROWERS AND FACILITY GUARANTORS party hereto;
the LENDERS party hereto; and
BANK OF AMERICA, N.A., a national banking association having a place of business at 100 Federal Street, Boston, Massachusetts 02110, as Administrative Agent and Collateral Agent for itself and the other Secured Parties;
in consideration of the mutual covenants herein contained and benefits to be derived herefrom.
WITNESSETH
WHEREAS, the Lead Borrower and the other Borrowers, the Facility Guarantors, the Administrative Agent, the Collateral Agent, the Lenders, the Co-Syndication Agents, the Co-Documentation Agents and the Senior Managing Agents have entered into an Amended and Restated Credit Agreement dated as of January 15, 2010 (the “ Credit Agreement ”); and
WHEREAS, the Lead Borrower has informed the Administrative Agent and the Lenders that it intends to refinance the Term Loan Financing Facility, the Holdco Notes and the Senior Notes (as such terms are defined in the Credit Agreement); and
WHEREAS, the Lead Borrower has informed the Administrative Agent and the Lenders that it intends to make a cash dividend to the Sponsors in an amount up to $325,000,000; and
WHEREAS, the Lead Borrower and the other Borrowers, the Facility Guarantors, the Administrative Agent and the Required Lenders have agreed to amend certain provisions of the Credit Agreement, on the terms and conditions set forth herein.
NOW THEREFORE, it is hereby agreed as follows:
| 1. | Definitions : All capitalized terms used herein and not otherwise defined shall have the same meaning herein as in the Credit Agreement. |
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| 2. | Amendments to Article I . The provisions of Article 1 of the Credit Agreement are hereby amended as follows: |
| a. | The definition of “ Availability Reserves ” is hereby amended by adding “or the Senior Note Refinancing Documents” after “the Holdco Note Documents” in the eleventh line thereof and in the sixteenth line thereof. |
| b. | The definition of “ Change in Control ” is hereby amended by adding “or the Senior Refinancing Notes” after “the Holdco Notes” in clause (a) thereof. |
| c. | The definition of “ Excluded Net Proceeds ” is hereby deleted in its entirety and the following substituted in its stead: |
“ Excluded Net Proceeds ” means, (i) with respect to any Net Proceeds received from a sale, transfer or disposition of any of the Term Loan Priority Collateral or any event described in clause (b) of the definition of “Prepayment Event” with respect to any of the Term Loan Priority Collateral only, such portion of such Net Proceeds that are then required to be paid to the lenders under the Term Loan Financing Facility, (ii) all Net Proceeds received from any Indebtedness used to refinance the Term Loan Financing Facility as permitted pursuant to Section 5 of the First Amendment, (iii) with respect to any Net Proceeds received from any Indebtedness used to refinance the Term Loan Financing Facility in accordance with Section 6.06(b)(v) hereof (other than as described in clause (ii) above), such portion of such Net Proceeds that is required to be paid to the lenders under the Term Loan Financing Facility and (iv) with respect to any Net Proceeds received from any other Prepayment Event, if the Term Payment Availability Conditions are satisfied, and no Cash Dominion Event has occurred and is continuing or would arise therefrom, such portion of such Net Proceeds that are required to be paid to the lenders under the Term Loan Financing Facility.
| d. | The definition of “ Fiscal Month ” is hereby deleted in its entirety and the following substituted in its stead: |
“ Fiscal Month ” means any fiscal month of any Fiscal Year, which month shall generally consist of (i) in the case of the first, third, fourth, sixth, seventh, ninth and tenth Fiscal Months of each Fiscal Year, four calendar weeks, (ii) in the case of the second, fifth, eighth and eleventh Fiscal Months of each Fiscal Year, five calendar weeks and (iii) in the case of the twelfth Fiscal Month of each Fiscal Year, the period from the first day following the eleventh Fiscal Month of such Fiscal Year through the last day of such Fiscal Year, in accordance with the fiscal accounting calendar of the Parent and its Subsidiaries.
| e. | The definition of “ Fiscal Quarter ” is hereby deleted in its entirety and the following substituted in its stead: |
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“ Fiscal Quarter ” means any fiscal quarter of any Fiscal Year, which quarter shall generally end on (i) in the case of the first three Fiscal Quarters of each Fiscal Year, on the date that is 13 weeks after the last day of the preceding Fiscal Quarter and (ii) in the case of the last Fiscal Quarter of each Fiscal Year, on the last day of such Fiscal Year, in accordance with the fiscal accounting calendar of the Parent and its Subsidiaries.
| f. | The definition of “ Fiscal Year ” is hereby deleted in its entirety and the following substituted in its stead: |
“ Fiscal Year ” means any period of twelve consecutive Fiscal Months ending on the Saturday closest to January 31 of any calendar year.
| g. | The definition of “ Holdco Notes ” is hereby deleted in its entirety and the following substituted in its stead: |
“ Holdco Notes ” means (i) the 14 1 / 2 % Senior Discount Notes Due 2014 in the original amount of $99,309,000 issued by Holdings under an Indenture dated as of April 13, 2006 or any supplemental indenture with Wilmington Trust FSB, as successor Trustee and any securities issued in lieu or in replacement thereof, and (ii) any Indebtedness of Holdings incurred pursuant to clause (u) of the definition of “Permitted Indebtedness”.
| h. | The definition of “ Intercreditor Agreement ” is hereby deleted in its entirety and the following substituted in its stead: |
“ Intercreditor Agreement ” means that certain Intercreditor Agreement dated as of the Closing Date by and among the Agents, JPMorgan Chase Bank, N.A., as successor administrative agent and collateral agent to Bear Stearns Corporate Lending Inc. under the Term Loan Financing Facility (as refinanced pursuant to the terms and conditions of the First Amendment), and the Loan Parties and attached hereto as Exhibit K , as amended and in effect from time to time.
| i. | The definition of “ Material Indebtedness ” is hereby amended by adding “the Senior Refinancing Notes,” after “the Holdco Notes,” in the third line thereof. |
| j. | The definition of “ Permitted Indebtedness ” is hereby amended as follows: |
| i. | by deleting clause (h) thereof in its entirety and by substituting the following in its stead: |
“(h) Indebtedness under the Holdco Notes and the Senior Notes, as the same may be refinanced by the Senior Refinancing Notes, provided that in no event shall the principal amount of such Indebtedness increase in
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excess of $500,000,000 (other than pursuant to clause (v) of this definition);”
| ii. | by deleting “$900,000,000” in clause (i) thereof and by substituting “$1,150,000,000” in its stead; |
| iii. | by adding “or the Senior Refinancing Notes” after “the Holdco Notes” in clause (l) thereof; |
| iv. | by deleting clause (u) thereof in its entirety and by substituting the following in its stead: |
“(u) Unsecured Indebtedness of Holdings in an amount not to exceed $100,000,000 in the aggregate (except as increased pursuant to clause (v) of this definition), provided that such Indebtedness (i) shall not have a maturity date or be subject to amortization, mandatory repurchase or redemption (except pursuant to customary asset sale and change of control provisions requiring such redemption or repurchase if and only to the extent permitted hereunder) prior to the date that is six months after the later of the Extended Term Maturity Date and the maturity date under the Term Loan Financing Facility, and (ii) shall not be exchangeable or convertible into Disqualified Capital Stock or any other Indebtedness (other than any Indebtedness that is otherwise permitted to be incurred under this Agreement at the time of such exchange or conversion);”
| v. | by deleting clause (v) thereof in its entirety and by substituting the following in its stead: |
“(v) except as set forth in clauses (h) and (u) hereof, without duplication of, or accumulation with, other categories of Indebtedness permitted hereunder, other unsecured Indebtedness (other than Subordinated Indebtedness) in an aggregate principal amount not exceeding $150,000,000 at any time outstanding; and”
| k. | The definition of “ Permitted Investments ” is hereby amended by replacing the phrase “; and” appearing at the end of clause (s) thereof with “;”, replacing the “;” appearing at the end of clause (t) thereof with “; and” and inserting the following new clause (u) thereafter: |
“(u) if the Payment Conditions are satisfied, other Investments in an amount not to exceed the then Available Amount (as defined in the Term Loan Agreement);”
| l. | The definitions of “ Term Loan Agreement ” and “ Term Loan Financing Facility ” are hereby deleted in their entirety and the following substituted in their stead: |
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“ Term Loan Agreement ” means that certain Credit Agreement dated April 13, 2006 by and among Burlington Coat Factory Warehouse Corporation, as Borrower, JPMorgan Chase Bank, N.A., as successor in interest to Bear Stearns Corporate Lending Inc., as administrative agent and collateral agent, and the lenders identified therein, as such Credit Agreement may be replaced in its entirety by that certain Credit Agreement dated February 24, 2011 by and among Burlington Coat Factory Warehouse Corporation, as Borrower, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, and the lenders identified therein.
“ Term Loan Financing Facility ” means the term loan facility established pursuant to the Term Loan Agreement in an original principal amount of $1,000,000,000, as amended, modified, supplemented, refinanced or replaced from time to time to the extent permitted pursuant to SECTION 6.09 hereof, provided that any such refinancing shall not increase the outstanding principal amount thereof in excess of $1,150,000,000 or result in an earlier maturity date or decreased weighted average life thereof, is subject to the terms of the Intercreditor Agreement and otherwise satisfies the requirements of a Permitted Refinancing hereunder.
| m. | The following new definitions are hereby added to Article I in appropriate alphabetical order: |
“ 2011 Dividend ” means that certain dividend paid in cash to the Sponsors in an amount of up to $325,000,000 in connection with the refinancing of the Senior Notes, the Holdco Notes and the existing Term Loan Financing Facility, which 2011 Dividend shall in any event be made prior to April 30, 2011.
“ First Amendment ” means that certain First Amendment and Consent to Credit Agreement dated February 24, 2011 by and among the Borrowers, the Facility Guarantors, the Required Lenders and the Administrative Agent.
“ First Amendment Effective Date ” means February 24, 2011.
“ Senior Note Refinancing Documents ” means the documents, instruments and other agreements now or hereafter executed and delivered in connection with the Senior Refinancing Notes, including, without limitation, the Indenture dated February 24, 2011 or any supplemental indenture with Wilmington Trust FSB, as trustee.
“ Senior Refinancing Notes ” means the 10% unsecured Senior Notes Due 2019 in the original amount of up to $500,000,000 issued by the Lead Borrower to refinance the Senior Notes and the Holdco Notes, and any securities issued in lieu or in replacement thereof.
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| n. | Section 1.03(b) is hereby amended by replacing the phrase “, and” appearing at the end of clause (c) thereof with “,”, replacing the “.” appearing at the end of clause (d) thereof with “, and” and inserting the following new clause (e) thereafter: |
“(e) the effect of any changes to lease accounting that requires the assets and liabilities arising under operating leases to be recognized in any statement of financial position.”
| 3. | Amendments to Article V . The provisions of Article V of the Credit Agreement are hereby amended as follows: |
| a. | Section 5.01(a) is hereby amended by deleting “(without a “going concern” or like qualification or exception and without a qualification or exception as to the scope of such audit)” and by substituting “(without a “going concern” or like qualification or exception and without a qualification or exception as to the scope of such audit (provided that such a qualification or exception may be included for any period ending within the twelve (12) month period preceding the maturity of the Obligations to the extent that such qualification or exception is solely the result of the Obligations or the Indebtedness under the Term Loan Financing Facility being reported as short term Indebtedness))” in its stead. |
| b. | Section 5.11 is hereby amended by adding “the Senior Refinancing Notes,” after “the Holdco Notes,” in the sixth line thereof. |
| c. | Section 5.12 is hereby amended by deleting “(except that, if such Subsidiary is a Foreign Subsidiary, shares of Capital Stock of such Subsidiary to be pledged may be limited to 65% of the outstanding shares of Capital Stock of such Subsidiary)” and by substituting “(except that, if such Subsidiary is a Foreign Subsidiary or a Subsidiary in which substantially all of its assets consist of the Capital Stock of one or more Foreign Subsidiaries, shares of Capital Stock of such Subsidiary to be pledged may be limited to 65% of the outstanding shares of Capital Stock of such Subsidiary)” in its stead. |
| 4. | Amendments to Article VI . The provisions of Article VI of the Credit Agreement are hereby amended as follows: |
| a. | Section 6.06(a)(i) is hereby amended by deleting clause (z) thereof in its entirety and by substituting the following in its stead: |
“(z) so long as no Event of Default shall have occurred and be continuing under SECTIONS 6.10, 7.01(a), 7.01(b), 7.01(h), or 7.01(i) or would result therefrom, to pay principal and interest as and when due in respect of the Holdco Notes described in clause (i) of the definition thereof to the extent required under the
6
Holdco Note Documents and to pay interest as and when due in respect of the Holdco Notes described in clause (ii) of the definition thereof;”
| b. | Section 6.06(a) is hereby amended by deleting “and” at the end of clause (iv) thereof, by renumbering clause (v) thereof as clause (vi), and by inserting the following new clause (v) therein: |
(v) So long as no Default or Event of Default has occurred and is continuing, the Loan Parties may declare, pay and/or make the 2011 Dividend on or before April 30, 2011; and”
| c. | Section 6.06(b)(iii) is hereby amended by adding “the Senior Refinancing Notes,” after “the Holdco Notes,” in the fourth line thereof. |
| d. | Section 6.06(b)(iv) is hereby amended by adding “the Senior Refinancing Notes,” after “the Holdco Notes,” in the first line thereof. |
| e. | Section 6.06(b)(v) is hereby amended by adding “the Senior Refinancing Notes,” after “the Holdco Notes,” in the first and third lines thereof. |
| f. | Section 6.06(b)(vi) is hereby amended by adding “or the Senior Refinancing Notes” after “or the Holdco Notes” in the second line thereof. |
| g. | Section 6.06(b) is hereby amended by renumbering clauses (viii), (ix), (x) and (xi) thereof as clauses (ix), (x), (xi) and (xii), respectively, and by inserting the following new clause (viii) therein: |
“(viii) if the Payment Conditions are satisfied, payments or other distributions in an amount not to exceed the then Available Amount (as defined in the Term Loan Agreement);”
| h. | Section 6.08 is hereby amended by adding “the Senior Refinancing Notes,” after “the Holdco Notes,” in clause (v) thereof. |
| i. | Section 6.09 is hereby amended by deleting “the Closing Date” in the second sentence thereof and by substituting “the First Amendment Effective Date” in its stead. |
| j. | Section 6.11 is hereby deleted in its entirety and the following substituted in its stead: |
“ Fiscal Year . No Loan Party will change its Fiscal Year without the prior written consent of the Agents.”
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| 5. | Consent to Refinancing and 2011 Dividend . The Administrative Agent and the Required Lenders hereby consent to (a) the refinancing of the Senior Notes and the Holdco Notes pursuant to the Senior Refinancing Notes, and the refinancing of the Term Loan Financing Facility, in each case as set forth herein, whether or not such refinancing of the Senior Notes, Holdco Notes and/or Term Loan Financing Facility would otherwise constitute a Permitted Refinancing under the terms of the Credit Agreement, and (b) subject to the provisions of paragraph 4(b) of this First Amendment, the payment of the 2011 Dividend. |
| 6. | Conditions to Effectiveness . This First Amendment shall not be effective until each of the following conditions precedent have been fulfilled to the satisfaction of (or waived by) the Administrative Agent: |
| a. | This First Amendment shall have been duly executed and delivered by the Lead Borrower and the other Borrowers, the Facility Guarantors, the Agents and the Required Lenders. The Administrative Agent shall have received a fully executed copy hereof and of each other document required hereunder. |
| b. | All action on the part of the Loan Parties necessary for the valid execution, delivery and performance by the Loan Parties of this First Amendment shall have been duly and effectively taken. The Administrative Agent shall have received from the Loan Parties true copies of their respective resolutions authorizing the transactions described herein, each certified by their secretary or other appropriate officer to be true and complete. |
| c. | No Default or Event of Default shall have occurred and be continuing as of the First Amendment Effective Date. |
| d. | The Loan Parties shall have delivered a certificate executed by a Responsible Officer of the Lead Borrower setting forth reasonably detailed calculations with respect to Availability after giving effect to the refinancing of the Senior Notes, the Holdco Notes and the Term Loan Financing Facility, and the making of the 2011 Dividend. |
| e. | The Loan Parties shall have delivered updated schedules to the Credit Agreement to reflect the refinancing of the Senior Notes, the Holdco Notes and the Term Loan Financing Facility, and the making of the 2011 Dividend. |
| 7. | Miscellaneous . |
| a. |
Except as provided herein, all terms and conditions of the Credit Agreement and the other Loan Documents remain in full force and effect. The Loan Parties each hereby ratify, confirm, and reaffirm all of the representations, warranties (other than representations and warranties which specifically relate to an earlier date) |
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and covenants therein contained, and hereby confirm that all Obligations continue to remain secured by the Collateral.
| b. | The Borrowers shall reimburse the Administrative Agent for all reasonable and documented out-of-pocket expenses incurred by the Administrative Agent in connection herewith, including, without limitation, reasonable attorneys’ fees of one counsel for the Administrative Agent (plus local counsel in any other jurisdiction to the extent reasonably necessary). |
| c. | This First Amendment may be executed in several counterparts and by each party on a separate counterpart, each of which when so executed and delivered, each shall be an original, and all of which together shall constitute one instrument. Delivery of an executed counterpart of a signature page hereto by telecopy or e-mail of a PDF copy shall be effective as delivery of a manually executed counterpart hereof. |
| d. | This First Amendment and the Credit Agreement together shall constitute one agreement. This First Amendment and the Credit Agreement together express the entire understanding of the parties with respect to the matters set forth herein and supersede all prior discussions or negotiations hereon. |
| e. | Any provision of this First Amendment 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. |
| f. | This First Amendment shall be construed, governed, and enforced pursuant to the laws of the State of New York. |
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IN WITNESS WHEREOF, the parties hereto have caused this First Amendment to be executed as of the date first above written.
|
BURLINGTON COAT FACTORY WAREHOUSE CORPORATION (“L EAD B ORROWER ”) |
||
| By |
/s/ Robert LaPenta |
|
| Print Name: Robert LaPenta | ||
| Title: Vice President and Treasurer | ||
|
THE ENTITIES LISTED ON SCHEDULE I HERETO , as Borrowers |
||
| By |
/s/ Robert LaPenta |
|
| Print Name: Robert LaPenta | ||
| Title: Vice President and Treasurer | ||
|
THE ENTITIES LISTED ON SCHEDULE II HERETO , as Facility Guarantors |
||
| By |
/s/ Robert LaPenta |
|
| Print Name: Robert LaPenta | ||
| Title: Vice President and Treasurer | ||
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|
BANK OF AMERICA, N.A. , As Administrative Agent, as Collateral Agent, and as Issuing Bank |
||
| By: |
/s/ Robert Malouf |
|
| Name: Roger Malouf | ||
| Title: Vice President | ||
|
BANK OF AMERICA, N.A. , As Swingline Lender, and as a Lender |
||
| By: |
/s/ Robert Malouf |
|
| Name: Roger Malouf | ||
| Title: Vice President | ||
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|
U.S. BANK, NATIONAL ASSOCIATION, as a Lender |
||
|
By: |
/s/ Craig Winslow |
|
| Name: Craig Winslow | ||
| Title: Authorized Signatory | ||
|
GE BUSINESS FINANCIAL SERVICES, INC., As a Lender |
||
| By: |
/s/ Craig Winslow |
|
| Name: Craig Winslow | ||
| Title: Authorized Signatory | ||
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|
WELLS FARGO BANK, NATIONAL ASSOCIATION (as successor by merger to Wells Fargo Retail Finance, LLC), As Co-Syndication Agent, as an Issuing Bank and as a Lender |
||
| By: |
/s/ Robert C. Chuckarian |
|
| Name: Robert C. Chuckarian | ||
| Title: Vice President | ||
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|
SUNTRUST BANK, As a Senior Managing Agent and as a Lender |
||
| By: |
/s/ Christopher M. Waterstreet |
|
| Name: Christopher M. Waterstreet | ||
| Title: Vice President | ||
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| UBS SECURITIES LLC, As Co-Documentation Agent | ||
| By: |
/s/ Ira R. Otsa |
|
| Name: Ira R. Otsa | ||
| Title: Associate Director | ||
| By: |
/s/ Mary E. Evans |
|
| Name: Mary E. Evans | ||
| Title: Attorney-In-Fact | ||
| UBS LOAN FINANCE, As a Lender | ||
| By: |
/s/ Ira R. Otsa |
|
| Name: Ira R. Otsa | ||
| Title: Associate Director | ||
| By: |
/s/ Mary E. Evans |
|
| Name: Mary E. Evans | ||
| Title: Attorney-In-Fact | ||
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| CITIZENS BANK OF PENNSYLVANIA, As a Lender | ||
| By: |
/s/ Dom Cmar |
|
| Name: Don Cmar | ||
| Title: Vice President | ||
16
|
U.S. BANK NATIONAL ASSOCIATION, As a Senior Managing Agent and as a Lender |
||
| By: |
/s/ Authorized Signatory |
|
| Name: Authorized Signatory | ||
| Title: Authorized Signatory | ||
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|
HSBC BUSINESS CREDIT (USA) INC., As Lender |
||
| By: |
/s/ Kysha A. Pierre-Louis |
|
| Name: Kysha A. Pierre-Louis | ||
| Title: Vice President | ||
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| ALLIED IRISH BANKS, P.L.C., As a Lender | ||
| By: |
/s/ Brent Phillips |
|
| Name: Brent Phillips | ||
| Title: Vice President | ||
| By: |
/s/ Martin Chin |
|
| Name: Martin Chin | ||
| Title: Senior Vice President | ||
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|
REGIONS BANK, As Co-Syndication Agent and as a Lender |
||
| By: |
/s/ Authorized Signatory |
|
| Name: Authorized Signatory | ||
| Title: Authorized Signatory | ||
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|
J.P. MORGAN SECURITIES INC., As a Co-Documentation Agent |
||
| By: |
/s/ Authorized Signatory |
|
| Name: Authorized Signatory | ||
| Title: Authorized Signatory | ||
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| JPMORGAN CHASE BANK , N.A., As a Lender | ||
| By: |
/s/ Scott Troy |
|
| Name: Scott Troy | ||
| Title: Vice President | ||
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