Exhibit 10.1

Execution Version

AMENDMENT NO. 2

AMENDMENT NO. 2, dated as of March 22, 2018 (this “ Amendment ”), to the Credit and Guarantee Agreement dated as of December 8, 2016 (as amended, supplemented, amended and restated or otherwise modified from time to time) (the “ Existing Credit Agreement ”) among LIONS GATE ENTERTAINMENT CORP., a corporation organized under the laws of the province of British Columbia, Canada (the “ Existing Borrower ”), each Guarantor party thereto, each lender from time to time party thereto (collectively, the “ Lenders ” and individually, a “ Lender ”), JPMORGAN CHASE BANK, N.A., as Administrative Agent (in such capacity, the “ Administrative Agent ”) and the other parties thereto. Capitalized terms used and not otherwise defined herein shall have the meanings assigned to them in the Existing Credit Agreement.

WHEREAS, Section 2.15 of the Existing Credit Agreement provides that (i) the Existing Borrower may, by written notice to the Administrative Agent, incur Refinancing Term Loans, the proceeds of which are used to refinance in whole or in part any Class of Term Loans and (ii) establish Replacement Revolving Credit Commitments which replace in whole or in part any Class of Revolving Credit Commitments, in each case by entering into Refinancing Amendments with Lenders willing to provide such Refinancing Term Loans and Replacement Revolving Credit Commitments;

WHEREAS, the Existing Borrower desires, pursuant to Section 2.15(a) of the Existing Credit Agreement, to create a new class of term loans (the “ Refinancing Term A Loans ” or the “ New Term A Loans ”; the commitments thereunder, the “ New Term A Commitments ”) under the Existing Credit Agreement in an aggregate principal amount of $750,000,000, having identical terms with and having the same rights and obligations under the Fundamental Documents as the “Term A Loans” (as defined in the Existing Credit Agreement, the “ Existing Term A Loans ”, the Lenders holding such Existing Term A Loans, the “ Existing Term A Lenders ”), as set forth in the Existing Credit Agreement and Fundamental Documents, except as such terms are amended hereby as set forth in the Amended and Restated Credit Agreement (as defined below);

WHEREAS, the Existing Borrower desires, pursuant to Section 2.15(a) of the Existing Credit Agreement, to create a new class of term loans (the “ Refinancing Term B Loans ” and together with the Refinancing Term A Loans, the “ Refinancing Term Loans ”) under the Existing Credit Agreement having identical terms with and having the same rights and obligations under the Fundamental Documents as, and in the same aggregate principal amount as, the “Term B-1 Loans” (as defined in the Existing Credit Agreement, the “ Existing Term B Loans ” and together with the Existing Term A Loans, the “ Existing Term Loans ”; the Lenders holding such Existing Term B Loans, the “ Existing Term B Lenders ”), as set forth in the Existing Credit Agreement and Fundamental Documents, except as such terms are amended hereby as set forth in the Amended and Restated Credit Agreement;

WHEREAS, the Existing Borrower desires, pursuant to Section 2.15(b) of the Existing Credit Agreement, to create a new class of revolving commitments (the “ Replacement Revolving Commitments ”) under the Existing Credit Agreement having identical terms with and having the same rights and obligations under the Fundamental Documents as, and in the same aggregate principal amount as, the “ Revolving Credit Commitments ” (as defined in the Existing Credit

Agreement, the “ Existing Revolving Credit Commitments ”, any outstanding Revolving Loans made thereunder, the “ Existing Revolving Loans ”; the Lenders holding such Existing Revolving Credit Commitments and/or Existing Revolving Loans, the “ Existing Revolving Lenders ”; the Existing Term A Lenders, Existing Term B Lenders and Existing Revolving Lenders, collectively, the “ Existing Lenders ”), as set forth in the Existing Credit Agreement and Fundamental Documents, except as such terms are amended hereby as set forth in the Amended and Restated Credit Agreement;

WHEREAS, the Existing Borrower desires, pursuant to Section 2.13 of the Existing Credit Agreement and after giving effect to the Refinancing Term Loans and Replacement Revolving Commitments, to effect an increase of Revolving Credit Commitments in an aggregate principal amount of $500,000,000 (the “ Incremental Revolving Commitments ”) under the Existing Credit Agreement under the same Class and having identical terms with and having the same rights and obligations under the Fundamental Documents as the Replacement Revolving Commitments (the Incremental Revolving Commitments, together with the Replacement Revolving Commitments, the “ New Revolving Credit Commitments ”);

WHEREAS, the Existing Borrower desires, pursuant to Section 2.13 of the Existing Credit Agreement and after giving effect to the Refinancing Term Loans and Replacement Revolving Commitments, to effect an increase to the aggregate amount of the Term B Facility in an aggregate principal amount of $425,000,000 (the “ Incremental Term B Loans ”) under the Existing Credit Agreement under the same Class and having identical terms with and having the same rights and obligations under the Fundamental Documents as the Refinancing Term B Loans (the Incremental Term B Loans, together with the Refinancing Term B Loans, the “ New Term B Loans ”; the commitments thereunder, the “ New Term B Commitments ”; the New Term B Loans together with the New Term A Loans, the “ New Term Loans ”; the New Term A Commitments and the New Term B Commitments, collectively, the “ New Term Commitments ”);

WHEREAS, on the Amendment No. 2 Effective Date (as defined herein), conditioned upon and immediately after giving effect to the incurrence of the New Term Loans and the New Revolving Credit Commitments pursuant to this Amendment, the Existing Borrower desires, pursuant to Section 11.3 of the Existing Credit Agreement, to automatically, pursuant to the terms of this Amendment, assign all of its rights and all Obligations under all Fundamental Documents to its wholly-owned Subsidiary, Lions Gate Capital Holdings LLC (the “ New Borrower ”), and to become a Guarantor under the Fundamental Documents, and the New Borrower desires to automatically, pursuant to the terms of this Amendment, assume all of the rights and all Obligations of the Existing Borrower under the Fundamental Documents (the “ Borrower Assignment ”);

WHEREAS, the Credit Parties and the Lenders party hereto wish to amend and restate the Existing Credit Agreement in its entirety as set forth in Amended and Restated Credit Agreement to give effect to the New Term Loans and the New Revolving Commitments and the terms thereof (including, the resetting of the Commitment Increases available after giving effect to the Incremental Revolving Commitments and the Incremental Term B Loans, as set forth in Section 2.13 of the Amended and Restated Credit Agreement) and the Borrower Assignment;

 

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WHEREAS, each Person (the “ New Term A Lender ”) that executes and delivers an addendum to this Amendment substantially in the form of Exhibit A hereto (a “ Term A Lender Addendum ”), will commit to make New Term A Loans in the amount not to exceed the amount set forth opposite such Person’s name and below the mention “Term A Loan Commitments” on Schedule 1.1 to the Amended and Restated Credit Agreement (the “ Commitment Schedule ”) to the Existing Borrower, the proceeds of which will be used by the Existing Borrower to repay in part the outstanding principal amount of Existing Term A Loans, and shall be deemed to have consented to this Amendment, the Borrower Assignment, and the Amended and Restated Credit Agreement;

WHEREAS, each Person (the “ New Term B Lender ”) that executes and delivers an addendum to this Amendment substantially in the form of Exhibit B hereto (a “ Term B Lender Addendum ”) will commit to make New Term B Loans in the amount not to exceed the amount set forth opposite such Person’s name and below the mention “Term B Loan Commitments” on the Commitment Schedule on the Amendment No. 2 Effective Date to the Existing Borrower, the proceeds of which will be used by the Existing Borrower to repay in full the outstanding principal amount of Existing Term B Loans and to repay the outstanding amount of Existing Term A Loans remaining after giving effect to the New Term A Loans, and for working capital and other general corporate purposes, and shall be deemed to have consented to this Amendment, the Borrower Assignment and the Amended and Restated Credit Agreement;

WHEREAS, each Person (the “ New Revolving Lender ”) that executes and delivers an addendum to this Amendment substantially in the form of Exhibit C hereto (a “ Revolving Lender Addendum ”; the Term A Lender Addendum, Term B Lender Addendum and Revolving Lender Addendum, collectively, the “ Lender Addenda ” and individually, a “ Lender Addendum ”) will provide New Revolving Commitments in the amount not to exceed the amount set forth opposite such Person’s name and below the mention “Revolving Credit Commitments” on the Commitment Schedule on the Amendment No. 2 Effective Date to the Existing Borrower (and, after giving effect to the Borrower Assignment, the New Borrower), which will replace the Existing Revolving Credit Commitments and which shall provide for the Incremental Revolving Commitments, and shall be deemed to have consented to this Amendment, the Borrower Assignment and the Amended and Restated Credit Agreement;

NOW, THEREFORE, in consideration of the premises and covenants contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound hereby, agree as follows:

Section 1. New Term Loans and New Revolving Commitments .

1.1 New Term A Loans.

(a) Subject to the terms and conditions set forth herein, each New Term A Lender will make New Term A Loans in the amount not to exceed the amount set forth opposite such New Term A Lender’s name on the Commitment Schedule on the Amendment No. 2 Effective Date to the Existing Borrower in the manner contemplated by the Amended and Restated Credit Agreement, the proceeds of which will be used by the Existing Borrower to repay in part the outstanding principal amount of Existing Term A Loans.

 

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1.2 New Term B Loans.

(b) Subject to the terms and conditions set forth herein, each New Term B Lender will make New Term B Loans in the amount not to exceed the amount set forth opposite such New Term B Lender’s name on the Commitment Schedule on the Amendment No. 2 Effective Date to the Existing Borrower in the manner contemplated by the Amended and Restated Credit Agreement, the proceeds of which will be used by the Existing Borrower to repay in full the outstanding principal amount of Existing Term B Loans and to repay the outstanding amount of Existing Term A Loans remaining after giving effect to the Refinancing Term A Loans, and for working capital and other general corporate purposes.

1.3. New Revolving Commitments .

(a) Subject to the terms and conditions set forth herein, each New Revolving Lender will make New Revolving Commitments available, in the amount not to exceed the amount set forth opposite such New Revolving Lender’s name on the Commitment Schedule on the Amendment No. 2 Effective Date and commit to make Revolving Loans to, and participate in Letters of Credit issued to, the Existing Borrower (and after giving effect to the Borrower Assignment, the New Borrower) in the manner contemplated by the Amended and Restated Credit Agreement, which will replace the Existing Revolving Credit Commitments and which shall provide for the Incremental Revolving Commitments, and the proceeds of which shall be used on the Amendment No. 2 Effective Date to repay in full the outstanding amount of Existing Revolving Loans (if any).

1.4 General.

(a) All the references in the Existing Credit Agreement to “Term B-1 Commitments” or “Term B-1 Loans” shall be deemed a reference to the New Term B Commitments or New Term B Loans, as applicable, contemplated hereby; all the references in the Existing Credit Agreement to “Term A Commitments” or “Term A Loans” shall be deemed a reference to the New Term A Commitments or New Term A Loans, as applicable, contemplated hereby; and all references in the Existing Credit Agreement to “Revolving Credit Commitments” shall be deemed a reference to the New Revolving Commitments contemplated hereby.

(b) Each Existing Lender delivering a Lender Addendum hereunder waives any right to compensation for losses incurred by such Lender to which it may otherwise be entitled pursuant to Section 3.6 of the Existing Credit Agreement in respect of the transactions contemplated hereby.

(c) Each Lender delivering a Lender Addendum hereunder waives the requirements set forth on Section 2.13(a)(L) in connection with the establishment of the Incremental Revolving Commitments and the Incremental Term B Loans contemplated hereby.

 

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Section 2. Borrower Assignment .

The Existing Borrower, the New Borrower, the Administrative Agent, each Lender that executes and delivers a Lender Addendum, and each Issuing Bank agree that, on the Amendment No. 2 Effective Date, immediately after giving effect to the incurrence of the New Term Loans and the New Revolving Credit Commitments pursuant to this Amendment (such time immediately thereafter, the “ Borrower Assignment Effectiveness Date ”):

(a) The Existing Borrower automatically, without further action or notice, assigns and transfers all of its rights and Obligations under the Fundamental Documents as Borrower to the New Borrower.

(b) The New Borrower hereby agrees to, and automatically and unconditionally assumes, without further action or notice, the Existing Borrower’s Obligations as Borrower under the Fundamental Documents and to be bound by all provisions of the Fundamental Documents applicable to the Borrower, and agrees that it may exercise every right and power of Borrower, and hereby agrees to perform and observe, each and every one of the covenants, rights, promises, agreements, terms, conditions, obligations, appointments, duties and liabilities of Borrower and Credit Party under the Fundamental Documents. On the Borrower Assignment Effectiveness Date, all references to the “Borrower” and “Credit Party” in all Fundamental Documents shall be deemed to refer to or to include, as applicable, the New Borrower. As used herein and in the Amended and Restated Credit Agreement, each reference to the “Borrower” shall be deemed to refer to (x) prior to the Borrower Assignment Effectiveness Date, the Existing Borrower and (y) on and after the Borrower Assignment Effectiveness Date, the New Borrower.

(c) The Existing Borrower, on the Borrower Assignment Effectiveness Date, is hereby automatically released from any obligations as Borrower under the Fundamental Documents, it being understood, for the avoidance of doubt, that the Liens on the assets of the Existing Borrower pursuant to the Collateral Documents are reaffirmed and shall continue to secure the Existing Borrower’s Obligations pursuant to the terms of the Collateral Documents, as amended and reaffirmed hereby.

(d) The Existing Borrower hereby expressly confirms that, on the Borrower Assignment Effectiveness Date, it automatically becomes a Guarantor and it assumes, and hereby agrees to perform and observe, each and every one of the covenants, rights, promises, agreements, terms, conditions, obligations, appointments, duties and liabilities of a Guarantor and Credit Party under the Credit Agreement.

(e) At any time and from time to time, upon the Administrative Agent’s request and at the sole expense of the New Borrower, the New Borrower will promptly and duly execute and deliver any and all further instruments and documents and take such further action as the Administrative Agent reasonably deems necessary to effect the purposes of the Borrower Assignment.

Section 3. Amended and Restated Credit Agreement; Pledge and Security Agreement and Other Collateral Documents.

To give effect to the New Term Loans, the New Revolving Credit Commitments, the Borrower Assignment to be effected on the Borrower Assignment Effectiveness Date and such other amendments and agreements agreed by the parties hereto:

 

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(a) The Existing Credit Agreement is hereby amended and restated in its entirety on the Amendment No. 2 Effective Date in the form of Annex D hereto (the “ Amended and Restated Credit Agreement ”);

(b) Schedule 1.1 and Schedule 2.3 and the Exhibits to the Existing Credit Agreement are amended and restated in their entirety in the form appended to the Amended and Restated Credit Agreement;

(c) Each of the Pledge and Security Agreement, the Copyright Security Agreement, the Patent Security Agreement, the Trademark Security Agreement, the Hypothec, each other Collateral Document, and each of the exhibits and supplements thereto, is amended as follows:

(1) References to the “Credit Agreement” or references to the “Obligations” and other defined terms as defined in the Credit Agreement shall refer to the Credit Agreement, the Obligations and such defined terms as amended pursuant to the Amended and Restated Credit Agreement, and as may be further amended or modified from time to time;

(2) As provided in Section 2, as of the Borrower Assignment Effectiveness Date, (i) each reference to the “Borrower” shall refer to Lions Gate Capital Holdings LLC Holding; (ii) each reference to a “Guarantor” shall include Lions Gate Entertainment Corp.; (iii) each reference to a “Grantor” shall continue to refer to both Lions Gate Entertainment Corp. (in its capacity as Existing Borrower, prior to the Borrower Assignment Effective Date, and in its capacity as a Guarantor thereafter) and the New Borrower; (iv) each reference to “Obligations” shall include the Obligations of the New Borrower as “Borrower” and the Obligations of the Existing Borrower as “Guarantor”;

(3) References to the “any subsidiary of the Borrower”, “a subsidiary of the Borrower” and “any Affiliate of the Borrower” shall be replaced with “any subsidiary of LGEC”, “a subsidiary of LGEC”, and “any Affiliate of LGEC”, as applicable;

(4) References to the “Borrower” in Section 3.2, Section 4.4, Section 4.5, Section 4.6, Section 4.7 and Section 4.8 of the Pledge and Security Agreement shall be replaced with “LGEC”.

To give effect to the Borrower Assignment on the Borrower Assignment Effectiveness Date, the Lenders hereby authorize the Administrative Agent to enter into those amendments, replacements, restatements, reaffirmation agreements, modifications and supplements to the Collateral Documents, or to enter into such other instruments and make all filings as may be necessary or appropriate in the reasonable determination of the Administrative Agent to give effect to such Borrower Assignment and the reaffirmation, confirmation and continuation of Liens in the Collateral by the Credit Parties.

Section 4. Representations and Warranties .

Each Credit Party represents and warrants to the Lenders as of the Amendment No. 2 Effective Date and as of the Borrower Assignment Effectiveness Date that:

 

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(a) Immediately before and after giving effect to this Amendment and the Borrower Assignment, each of the representations and warranties made by any Credit Party in or pursuant to the Fundamental Documents shall be true and correct in all material respects (or in all respects, if qualified by a materiality threshold) on and as of such date (except to the extent the same expressly relate to an earlier date).

(b) At the time of and immediately after giving effect to this Amendment and the Borrower Assignment, no Default or Event of Default shall have occurred and be continuing.

Section 5. Conditions to Effectiveness .

This Amendment shall become effective on the date on which each of the following conditions is satisfied (the “ Amendment No.  2 Effective Date ”):

(a) The Administrative Agent’s receipt of the following, each of which shall be originals or facsimiles or electronic copies (and, to the extent requested by the Administrative Agent, followed promptly by originals) unless otherwise specified:

(1) counterparts of this Amendment executed by each of the Loan Parties; and

(2) a Note executed by the Borrower in favor of each Lender requesting a Note at least two (2) Business Days prior to the Amendment No. 2 Effective Date, if any.

(b) The Administrative Agent’s receipt of the following, each of which shall be originals or facsimiles or electronic copies (and, to the extent requested by the Administrative Agent, followed promptly by originals) unless otherwise specified;

(1) written opinions of (i) Dentons Canada LLP, Canadian counsel to the Credit Parties, (ii) Wachtell, Lipton, Rosen & Katz, special New York counsel to the Credit Parties, (iii) Dentons UK and Middle East LLP, English counsel to the Credit Parties, (iv) Morgan, Lewis & Bockius (UK) LLP, English counsel to the Administrative Agent (iv) Arendt & Madernach SA, Luxembourg counsel to the Administrative Agent, and (v) in-house counsel for the Credit Parties and addressed to the Administrative Agent and the Lenders which opinions shall be in form and substance reasonably satisfactory to the Administrative Agent;

(2) a certificate of an authorized Officer of each Credit Party, dated the Amendment No. 2 Effective Date and certifying:

(A) either (I) that the by-laws, articles or limited liability company agreement, as the case may be, of such party has not been amended since the Amendment No. 1 Effective Date, or, if later, the date that such Credit Party joined the Credit Agreement or (II) that attached thereto is a true and complete copy of the by-laws, articles or limited liability company agreement, as the case may be, of such party as in effect on the date of such certification;

 

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(B) that attached thereto is a true and complete copy of the resolutions adopted by the Board of Directors of such party authorizing the execution, delivery and performance in accordance with their respective terms of the Fundamental Documents executed by such Credit Party and any other documents required or contemplated hereunder or thereunder, the security interests in the Collateral, and in the case of the Borrower, the borrowings hereunder, and that such resolutions have not been amended, rescinded or supplemented and are currently in effect;

(C) either (I) that the certificate of incorporation or organization or other similar organizational document of such party has not been amended since the Amendment No. 1 Effective Date, or, if later, the date that such Credit Party joined the Credit Agreement or (II) that attached thereto is a true and complete copy of such certificate or other organizational document including all amendments thereto; and

(D) as to the incumbency and specimen signature of each officer of such party executing any Fundamental Document;

(3) a certificate signed by an Officer of the Borrower certifying, as of the moment immediately prior to the Borrower Assignment Effectiveness Date, as to the satisfaction of the conditions set forth in Section 2.15 of the Existing Credit Agreement with respect to the New Term Commitments and the Replacement Revolving Commitments and in paragraphs (f) and (g) of this Section 5 as of the Amendment No. 2 Effective Date;

(4) fully executed copies of (i) the Hypothec (and all related agreements and instruments) executed by each Credit Party domiciled in the Province of Québec and each Credit Party where Collateral with respect to such Credit Party is located therein, or perfection of a Lien in such Collateral is required under the Applicable Laws of the Province of Québec or under any applicable PPSA and (ii) the Master Security Confirmation Agreement, dated as of the date hereof, among the Pledgors listed on Schedule I thereto, JPMorgan Chase Bank, N.A., as pledgee and the Companies listed on Schedule II thereto.

(c) The aggregate principal amount of the Existing Term B Loans, Existing Term A Loans and Existing Revolving Loans outstanding under the Existing Credit Agreement shall have been repaid in full or shall be repaid substantially concurrently on such date with the Credit Extension of the New Term Loans and New Revolving Commitments to be made on the Amendment No. 2 Effective Date, and all Existing Revolving Credit Commitments under the Existing Credit Agreement shall have been terminated.

(d) The Borrower shall have paid to the Administrative Agent, for the ratable account of the Existing Lenders, all accrued and unpaid interest on the Existing Term B Loans, Existing Term A Loans and Existing Revolving Loans, and all accrued but unpaid Commitment Fee with respect to the Existing Revolving Credit Commitments to, but not including, the Amendment No. 2 Effective Date.

 

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(e) All reasonable and documented out-of-pocket fees and expenses due to the Administrative Agent (including pursuant to Section 9 hereof) shall have been paid (or the Borrower shall have made arrangements reasonably satisfactory to the Administrative Agent for such payment).

(f) At the time and immediately after giving effect to the incurrence of the New Term Loans and the New Revolving Commitments, no Default or Event of Default shall have occurred and be continuing.

(g) Each of the representations and warranties of the Credit Parties set forth in the Amended and Restated Credit Agreement, Section 4 of this Amendment and in the other Fundamental Documents shall be and remain true and correct in all material respects (or in all respects, if qualified by a materiality threshold) as of the Amendment No. 2 Effective Date, except to the extent the same expressly relate to an earlier date.

(h) The Administrative Agent shall have received at least three Business Days prior to the Amendment No. 2 Effective Date any information requested at least ten Business Days prior to the Amendment No. 2 Effective Date by the Administrative Agent that the Administrative Agent reasonably determines is required by regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including without limitation the USA Patriot Act.

(i) The Administrative Agent shall have received a Solvency Certificate signed by the chief financial officer of the Existing Borrower.

(j) The Administrative Agent shall have received the Notice of Borrowing required by Section 2.5 of the Credit Agreement; provided that the Notice of Borrowing may be made conditional on the effectiveness of this Amendment.

Section 6. Formal Request Deemed Made; Other Requirements.

By its execution of this Amendment, the Existing Borrower hereby delivers and the Administrative Agent hereby acknowledges receipt of this Amendment as the satisfaction of the requirement to give any notice required to the Administrative Agent pursuant to Section 2.13 or Section 2.15 of the Existing Credit Agreement.

Section 7. Reaffirmation; Acknowledgments .

Each Credit Party party hereto (including, for the avoidance of doubt, (i) the Existing Borrower as a Guarantor (on the Borrower Assignment Effectiveness Date) and as a Credit Party and Grantor and (ii) the New Borrower as the Borrower (on the Borrower Assignment Effectiveness Date) and as a Credit Party and Grantor) hereby expressly acknowledges and agrees to the terms of this Amendment and reaffirms and confirms, as of the date hereof, (i) the covenants and agreements contained in each Fundamental Document to which it is a party, including, in each case, such covenants and agreements as in effect immediately after giving effect to this Amendment and the transactions contemplated hereby and that on and after the Amendment No. 2 Effective Date and Borrower Assignment Effectiveness Date each Fundamental Document remains in full force and effect, (ii) in its capacity as Guarantor, its

 

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guarantee of the Obligations (including, without limitation, the New Term Commitments, New Term Loans and New Revolving Commitments) pursuant to the Fundamental Documents and that on and after the Amendment No. 2 Effective Date and Borrower Assignment Effectiveness Date its guarantee will extend to the Obligations as amended by this Amendment, and (iii) its grant of Liens on the Collateral to secure the Obligations (including, without limitation, the Obligations with respect to the New Term Commitments, New Term Loans and New Revolving Commitments and the Obligations of the New Borrower as Borrower on and after the Borrower Assignment Effectiveness Date) pursuant to the Collateral Documents and that on and after the Amendment No. 2 Effective Date and the Borrower Assignment Effectiveness Date the Liens will continue to secure the Obligations as amended by this Agreement.

In connection with the foregoing, each Credit Party party hereto (including, for the avoidance of doubt, the Existing Borrower and the New Borrower), as a Grantor, hereby reaffirms its pledge, assignment and granting to the Administrative Agent, on behalf of and for the ratable benefit of the Secured Parties, of a security interest in the Collateral pursuant to the terms of the Pledge and Security Agreement and the other Collateral Documents, to secure the prompt and complete payment and performance, when due, of the Obligations (including, without limitation, the New Term Commitments, New Term Loans and New Revolving Commitments).

The Credit Parties that are a party to the Debenture (as defined below) and the Share Charge (as defined below) agree, acknowledge and confirm that the Debenture dated 8 December 2016 between each party listed in Schedule 1 thereto as Chargor and the Administrative Agent as Security Agent (the “ Debenture ”) and the Share Charge dated 8 December 2016 between Lions Gate International Motion Pictures S.A.R.L and the Administrative Agent (the “ Share Charge ”): (i) Rank as a continuing security for the payment and discharge of the Obligations (including, without limitation, the New Term Commitments, New Term Loans and New Revolving Commitments), and (ii) shall continue in full force and effect in all respects and the Debenture, the Share Charge and this Amendment shall be read and construed together.

Section 8. Liens Unimpaired .

It is the intention of the parties hereto that, after giving effect to this Amendment and the transactions contemplated hereby, neither the modification of the Existing Credit Agreement effected pursuant to this Amendment or as reflected in the Amended and Restated Credit Agreement nor the execution, delivery, performance or effectiveness of this Amendment and the transactions contemplated hereby:

(a) impairs the validity, effectiveness or priority of the Liens granted pursuant to any Fundamental Document, and such Liens continue unimpaired with the same priority to secure repayment of all Obligations (including, without limitation, with respect to the New Term Commitments, New Term Loans and New Revolving Commitments and the Obligations of the New Borrower as Borrower on and after the Borrower Assignment Effectiveness Date), whether heretofore or hereafter incurred; or

 

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(b) requires that any new filings be made or other action taken to perfect or to maintain the perfection of such Liens.

(c) Each Guarantor which is a party to a Luxembourg law–governed Collateral Document (such Collateral Documents, the “ Luxembourg Collateral Documents ”) confirms that the Pledge (as defined in the applicable Luxembourg Collateral Documents) granted pursuant to the Luxembourg Collateral Documents to which it is a party shall remain in full force and effect and secure the Obligations (including, without limitation, the New Term Commitments, New Term Loans and New Revolving Commitments) under the Credit Agreement.

Section 9. Entire Agreement .

This Amendment, the Amended and Restated Credit Agreement and the other Fundamental Documents constitute the entire agreement among the parties hereto with respect to the subject matter hereof and thereof and supersede all other prior agreements and understandings, both written and verbal, among the parties hereto with respect to the subject matter hereof. Except as expressly set forth herein and except as reflected in the Amended and Restated Credit Agreement, this Amendment and the Amended and Restated Credit Agreement shall not by implication or otherwise limit, impair, constitute a waiver of, or otherwise affect the rights and remedies of any party under, the Existing Credit Agreement, nor alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Existing Credit Agreement, all of which are ratified and affirmed in all respects and shall continue in full force and effect. It is understood and agreed that each reference in each Fundamental Document to the “Credit Agreement,” whether direct or indirect, shall hereafter be deemed to be a reference to the Amended and Restated Credit Agreement and that this Amendment and the Amended and Restated Credit Agreement is a “Fundamental Document”, a “Refinancing Amendment” and an “Incremental Amendment”.

Section 10. Amendment, Modification and Waiver .

This Amendment may not be amended, modified or waived except pursuant to a writing signed by each of the parties hereto.

Section 11. Expenses .

The Borrower agrees to reimburse the Administrative Agent for its reasonable and documented out-of-pocket expenses incurred by them in connection with this Amendment, including the reasonable and documented fees, charges and disbursements of counsel for the Administrative Agent, pursuant to the terms of Section 11.4 of the Amended and Restated Credit Agreement.

Section 12. Counterparts .

This Amendment may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of which when so executed and delivered shall be deemed to be an original, but all of which when taken together shall constitute a single instrument. Delivery of an executed counterpart of a signature page of this Amendment by facsimile transmission or electronic transmission shall be effective as delivery of a manually executed counterpart hereof.

 

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Section 13. Governing Law and Waiver of Right to Trial by Jury .

THIS AMENDMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES UNDER THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK. SECTION 11.8 AND SECTION 11.14 OF THE CREDIT AGREEMENT IS HEREBY INCORPORATED BY REFERENCE INTO THIS AMENDMENT AND SHALL APPLY HERETO.

Section 14. Headings .

The headings of this Amendment are for purposes of reference only and shall not limit or otherwise affect the meaning hereof.

Section 15. Effect of Amendment .

Except as expressly set forth herein and except as reflected in the Amended and Restated Credit Agreement, this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the Lenders or the Administrative Agent under the Existing Credit Agreement or any other Fundamental Document, and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Existing Credit Agreement or any other provision of the Existing Credit Agreement or any other Fundamental Document, all of which are ratified and affirmed in all respects and shall continue in full force and effect.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first above written.

 

 

[SIGNATURE PAGE TO AMENDMENT NO. 2]

 

[SIGNATURE PAGE TO AMENDMENT NO. 2]

 

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EXHIBIT A

TERM A LENDER ADDENDUM

TERM A LENDER ADDENDUM (this “ Lender Addendum ”) in connection with Amendment No. 2 (“ Amendment ”) to that certain Credit and Guarantee Agreement, dated as of December 8, 2016 (as amended, supplemented, amended and restated or otherwise modified from time to time) (the “ Existing Credit Agreement ”) among LIONS GATE ENTERTAINMENT CORP., a corporation organized under the laws of the province of British Columbia, Canada (the “ Existing Borrower ”), each Guarantor party thereto, each lender from time to time party thereto (collectively, the “ Lenders ” and individually, a “ Lender ”), JPMORGAN CHASE BANK, N.A., as Administrative Agent (in such capacity, the “ Administrative Agent ”) and the other parties thereto. Unless otherwise defined herein, terms defined and used herein shall have the meanings given to them in Amendment or in the Amended and Restated Credit Agreement referred to therein.

By executing this Lender Addendum as a Lender, the undersigned institution agrees (A) to the terms of the Amendment, the Borrower Assignment and the Amended and Restated Credit Agreement, (B) on the terms and subject to the conditions set forth in the Amendment and in the Amended and Restated Credit Agreement, to make Term A Loans on the Amendment No. 2 Effective Date Effective Date in the amount of its Term A Loan Commitment set forth opposite the undersigned institution’s name on the Commitment Schedule and (C) that on the Amendment No. 2 Effective Date, it is subject to, and bound by, the terms and conditions of the Amended and Restated Credit Agreement and other Fundamental Documents as a Lender thereunder.

IN WITNESS WHEREOF, the undersigned has caused this Lender Addendum to be executed and delivered by a duly authorized officer.

 

EXHIBIT B

TERM B LENDER ADDENDUM

TERM B LENDER ADDENDUM (this “ Lender Addendum ”) in connection with Amendment No. 2 (“ Amendment ”) to that certain Credit and Guarantee Agreement, dated as of December 8, 2016 (as amended, supplemented, amended and restated or otherwise modified from time to time) (the “ Existing Credit Agreement ”) among LIONS GATE ENTERTAINMENT CORP., a corporation organized under the laws of the province of British Columbia, Canada (the “ Existing Borrower ”), each Guarantor party thereto, each lender from time to time party thereto (collectively, the “ Lenders ” and individually, a “ Lender ”), JPMORGAN CHASE BANK, N.A., as Administrative Agent (in such capacity, the “ Administrative Agent ”) and the other parties thereto. Unless otherwise defined herein, terms defined and used herein shall have the meanings given to them in Amendment or in the Amended and Restated Credit Agreement referred to therein.

By executing this Lender Addendum as a Lender, the undersigned institution agrees (A) to the terms of the Amendment, the Borrower Assignment and the Amended and Restated Credit Agreement, (B) on the terms and subject to the conditions set forth in the Amendment and in the Amended and Restated Credit Agreement, to make Term B Loans on the Amendment No. 2 Effective Date Effective Date in the amount of its Term B Loan Commitment set forth opposite the undersigned institution’s name on the Commitment Schedule and (C) that on the Amendment No. 2 Effective Date, it is subject to, and bound by, the terms and conditions of the Amended and Restated Credit Agreement and other Fundamental Documents as a Lender thereunder.

IN WITNESS WHEREOF, the undersigned has caused this Lender Addendum to be executed and delivered by a duly authorized officer.

 

 

EXHIBIT C

REVOLVING LENDER ADDENDUM

REVOLVING LENDER ADDENDUM (this “ Lender Addendum ”) in connection with Amendment No. 2 (“ Amendment ”) to that certain Credit and Guarantee Agreement, dated as of December 8, 2016 (as amended, supplemented, amended and restated or otherwise modified from time to time) (the “ Existing Credit Agreement ”) among LIONS GATE ENTERTAINMENT CORP., a corporation organized under the laws of the province of British Columbia, Canada (the “ Existing Borrower ”), each Guarantor party thereto, each lender from time to time party thereto (collectively, the “ Lenders ” and individually, a “ Lender ”), JPMORGAN CHASE BANK, N.A., as Administrative Agent (in such capacity, the “ Administrative Agent ”) and the other parties thereto. Unless otherwise defined herein, terms defined and used herein shall have the meanings given to them in Amendment or in the Amended and Restated Credit Agreement referred to therein.

By executing this Lender Addendum as a Lender, the undersigned institution agrees (A) to the terms of the Amendment, the Borrower Assignment and the Amended and Restated Credit Agreement, (B) on the terms and subject to the conditions set forth in the Amendment and in the Amended and Restated Credit Agreement, commits to make Revolving Loans to, and participate in Letters of Credit issued to, the Existing Borrower (and after giving effect to the Borrower Assignment, the New Borrower) in the manner contemplated by the Amended and Restated Credit Agreement in the amount of its Revolving Credit Commitment set forth opposite the undersigned institution’s name on the Commitment Schedule and (C) that on the Amendment No. 2 Effective Date, it is subject to, and bound by, the terms and conditions of the Amended and Restated Credit Agreement and other Fundamental Documents as a Lender thereunder.

IN WITNESS WHEREOF, the undersigned has caused this Lender Addendum to be executed and delivered by a duly authorized officer.

 

 

B-2

Execution Version

 

 

 

CREDIT AND GUARANTEE AGREEMENT

Dated as of December 8, 2016

as Amended and Restated as of March 22, 2018

among

LIONS GATE CAPITAL HOLDINGS LLC

as New Borrower

LIONS GATE ENTERTAINMENT CORP.

as Existing Borrower

THE GUARANTORS REFERRED TO HEREIN

THE LENDERS REFERRED TO HEREIN

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

J.P. MORGAN SECURITIES LLC,

DEUTSCHE BANK SECURITIES INC.,

and

JPMORGAN CHASE BANK, N.A.

(solely with respect to the Term B Facility),

as Sole Lead Arranger and Sole Bookrunner

JPMORGAN CHASE BANK, N.A.

(solely with respect to the Term A Facility and the Revolving Facility),

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED ,

RBC CAPITAL MARKETS ^* ,

CREDIT SUISSE SECURITIES (USA) LLC, (solely with respect to the Term A Facility and the Revolving Facility),

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.

(solely with respect to the Term A Facility and the Revolving Facility),

RBC CAPITAL MARKETS ^*

(solely with respect to the Term A Facility and the Revolving Facility),

WELLS FARGO SECURITIES, LLC

(solely with respect to the Term B Facility), (solely with respect to the Term A Facility and the Revolving Facility),

as Joint Lead Arrangers, Joint Bookrunners and Co-Syndication Agents

SUNTRUST ROBINSON HUMPHREY, INC.

(solely with respect to the Term A Facility and the Revolving Facility) ,

BNP PARIBAS

(solely with respect to the Term A Facility and the Revolving Facility),

SOCIETE GENERALE

(solely with respect to the Term A Facility and the Revolving Facility),

as Joint Lead Arranger Arrangers and Joint Bookrunner Bookrunners

 

*	RBC Capital Markets is a brand name for the capital markets businesses of Royal Bank of Canada and its affiliates

SUNTRUST BANK ,

(solely with respect to the Term A Facility and the Revolving Facility) ,

as Co-Syndication Agent

and

WELLS FARGO SECURITIES, LLC , BNP PARIBAS,

(solely with respect to the Term A Facility and the Revolving Facility)

as Documentation Agent

THE BANK OF TOKYO-MITSUBISHI UFJ, LTD.

SOCIETE GENERALE

(solely with respect to the Term A Facility and the Revolving Facility),

BARCLAYS BANK PLC,

SUNTRUST FIFTH THIRD BANK

(solely with respect to the Term B A Facility and the Revolving Facility),

as Co-Documentation Agents

and

BNP PARIBAS,

as Managing Agent

 

 

 

 

 

*RBC Capital Markets is a brand name for the capital markets businesses of Royal Bank of Canada and its affiliates

TABLE OF CONTENTS

 

				Page
ARTICLE 1		DEFINITIONS			2
ARTICLE 2		THE LOANS			63 65
SECTION 2.1.		The Term Loans			63 65
SECTION 2.2.		Revolving Credit Commitments			64 66
SECTION 2.3.		Letters of Credit			64 66
SECTION 2.4.		Applicable Interest Rates			68 70
SECTION 2.5.		Manner of Borrowing Loans and Designating Applicable Interest Rates			69 71
SECTION 2.6.		Minimum Borrowing Amounts; Maximum Eurodollar Loans			71 73
SECTION 2.7.		Maturity of Loans			71 73
SECTION 2.8.		Prepayments			72 74
SECTION 2.9.		Place and Application of Payments			76 78
SECTION 2.10.		Commitment Terminations			77 79
SECTION 2.11.		Evidence of Indebtedness			78 80
SECTION 2.12.		Fees			78 80
SECTION 2.13.		Incremental Credit Extensions			79 81
SECTION 2.14.		Extensions of Term Loans and Revolving Credit Commitments			82 84
SECTION 2.15.		Refinancing Facilities			85 87
SECTION 2.16.		Defaulting Lenders			88 90
ARTICLE 3		CHANGES IN CIRCUMSTANCES, TAXES, INDEMNITY			89 91
SECTION 3.1.		Inability to Determine Interest Rate			89 91
SECTION 3.2.		Change in Legality			90 92
SECTION 3.3.		Change in Circumstances			93
SECTION 3.4.		Withholding Taxes			95
SECTION 3.5.		Foreign Currency Conversion; Withholding			97
SECTION 3.6.		Indemnity			97
SECTION 3.7.		Replacement of Lenders			98
SECTION 3.8.		Interest Adjustments			98
ARTICLE 4		REPRESENTATIONS AND WARRANTIES OF CREDIT PARTIES			98
SECTION 4.1.		Existence and Power			99
SECTION 4.2.		Authority and No Violation			99
SECTION 4.3.		Governmental Approval			99
SECTION 4.4.		Binding Agreements			100
SECTION 4.5.		Financial Statements			100
SECTION 4.6.		No Material Adverse Change; No Default; Solvency			98 101
SECTION 4.7.		Ownership of Subsidiaries, etc			99 101
SECTION 4.8.		Title to Properties			99 102
SECTION 4.9.		Litigation			102
SECTION 4.10.		Federal Reserve Regulations			100 102
SECTION 4.11.		Investment Company Act			100 102
SECTION 4.12.		Taxes			100 102

 

i

TABLE OF CONTENTS

(continued)

 

				Page
SECTION 4.13.		Compliance with ERISA; Labor Disputes			100 103
SECTION 4.14.		Non-U.S. Plan Compliance			101 103
SECTION 4.15.		Agreements			101 104
SECTION 4.16.		Creation, Validity and Perfection of Security Interest			101 104
SECTION 4.17.		Disclosure			102 104
SECTION 4.18.		Distribution Rights			102 104
SECTION 4.19.		Environmental Liabilities			102 105
SECTION 4.20.		Compliance with Laws			105
SECTION 4.21.		Real Property			103 105
SECTION 4.22.		OFAC, FCPA, etc			103 105
SECTION 4.23.		Use of Proceeds			103 106
ARTICLE 5		CONDITIONS PRECEDENT			104 106
SECTION 5.1.		Conditions to Initial Credit Extension			104 106
SECTION 5.2.		Conditions to Each Subsequent Credit Extension			107 110
ARTICLE 6		AFFIRMATIVE COVENANTS			107 110
SECTION 6.1.		Financial Statements and Other Information			107 110
SECTION 6.2.		Compliance Certificate and Other Information			109 111
SECTION 6.3.		Taxes			109 112
SECTION 6.4.		Corporate Existence			109 112
SECTION 6.5.		Maintenance of Properties and Insurance			110 112
SECTION 6.6.		Books and Records			110 113
SECTION 6.7.		Inspection Rights			110 113
SECTION 6.8.		Compliance with Laws			111 113
SECTION 6.9.		Compliance with Agreements			111 113
SECTION 6.10.		ERISA Event Notice			111 113
SECTION 6.11.		Non-U.S. Plan Compliance and Reports			111 114
SECTION 6.12.		Environmental Laws			111 114
SECTION 6.13.		Additional Guarantors			112 114
SECTION 6.14.		Further Assurances			112 115
SECTION 6.15.		OFAC, FCPA			114 116
SECTION 6.16.		Maintenance of Ratings			114 117
SECTION 6.17.		Post-Closing Actions			114 117
SECTION 6.18.		ERISA Matters			114 117
ARTICLE 7		NEGATIVE COVENANTS			114 117
SECTION 7.1.		Limitations on Indebtedness			115 117
SECTION 7.2.		Limitations on Restricted Payments			119 122
SECTION 7.3.		Limitation on Liens			123 126
SECTION 7.4.		Limitation on Restrictions on Distribution from Restricted Subsidiaries			124 126
SECTION 7.5.		Limitation on Affiliate Transactions			125 128
SECTION 7.6.		Limitation on Mergers and Consolidations			127 13 0
SECTION 7.7.		Limitation on Lines of Business			129 132
SECTION 7.8.		Limitation on Sales of Assets			129 132

 

ii

TABLE OF CONTENTS

(continued)

 

				Page
SECTION 7.9.		Financial Covenant			130 133
ARTICLE 8		EVENTS OF DEFAULT			131 134
SECTION 8.1.		Events of Default			131 134
SECTION 8.2.		Non-Bankruptcy Defaults			133 136
SECTION 8.3.		Bankruptcy Defaults			134 136
SECTION 8.4.		Collateral for Undrawn Letters of Credit			134 137
SECTION 8.5.		Right to Realize on Collateral and Enforce Guarantees			134 137
SECTION 8.6.		Borrower LGEC ’s Right to Cure			135 138
ARTICLE 9		GUARANTEE			135 138
SECTION 9.1.		Guarantee			135 138
SECTION 9.2.		No Impairment of Guarantee, etc			136 139
SECTION 9.3.		Continuation and Reinstatement, etc			137 139
SECTION 9.4.		Limitation on Guaranteed Amount, etc			137 140
SECTION 9.5.		Voluntary Arrangements			138 140
SECTION 9.6.		Release of Guarantees			138 141
SECTION 9.7.		Indemnity and Subrogation			139 142
SECTION 9.8.		Contribution and Subrogation			139 142
SECTION 9.9.		Subordination			139 142
SECTION 9.10.		Luxembourg Guarantors			140 142
ARTICLE 10		THE ADMINISTRATIVE AGENT AND THE ISSUING BANKS			141 144
SECTION 10.1.		Administration by the Administrative Agent			141 144
SECTION 10.2.		Sharing of Setoffs			143 145
SECTION 10.3.		Notice to the Lenders			143 146
SECTION 10.4.		Liability of the Administrative Agent, Issuing Banks			144 146
SECTION 10.5.		Reimbursement and Indemnification			145 147
SECTION 10.6.		Rights of Administrative Agent			145 148
SECTION 10.7.		Independent Investigation by Lenders			145 148
SECTION 10.8.		Agreement of Required Lenders			146 148
SECTION 10.9.		Notice of Transfer			146 148
SECTION 10.10.		Successor Administrative Agent			146 148
SECTION 10.11.		Administrative Agent May File Proofs of Claim			146 149
SECTION 10.12.		Québec Security			147 149
SECTION 10.13.		Other Agent Titles			147 150
ARTICLE 11		MISCELLANEOUS			147 150
SECTION 11.1.		Notices			147 150
SECTION 11.2.		Termination, Survival of Agreement, Representations and Warranties, etc			148 150
SECTION 11.3.		Successors and Assigns; Syndications; Loan Sales; Participations			148 151
SECTION 11.4.		Expenses; Documentary Taxes			152 154
SECTION 11.5.		Indemnification of the Administrative Agent, the Issuing Banks and the Lenders			153 155

 

iii

TABLE OF CONTENTS

(continued)

 

				Page
SECTION 11.6.		Set-Off			153 156
SECTION 11.7.		CHOICE OF LAW			154 156
SECTION 11.8.		WAIVER OF JURY TRIAL			154 156
SECTION 11.9.		WAIVER WITH RESPECT TO DAMAGES			154 157
SECTION 11.10.		No Waiver			155 157
SECTION 11.11.		Extension of Payment Date			155 157
SECTION 11.12.		Amendments, etc			155 157
SECTION 11.13.		Severability			157 160
SECTION 11.14.		SERVICE OF PROCESS; SUBMISSION TO JURISDICTION			158 160
SECTION 11.15.		Headings			158 161
SECTION 11.16.		Execution in Counterparts			158 161
SECTION 11.17.		USA Patriot Act			159 161
SECTION 11.18.		Entire Agreement			159 161
SECTION 11.19.		Confidentiality			159 161
SECTION 11.20.		Judgment Currency			159 162
SECTION 11.21.		Lender Obligations Several			160 162
SECTION 11.22.		Acknowledgement and Consent to Bail-In of EEA Financial Institutions			160 163
SECTION 11.23.		Amendment and Restatement			163

 

iv

Schedules

 

1.1		Schedule of Commitments
1.2		Certain Excluded Assets
1.3		Initial LUX/UK Guarantors
1.4		Existing Investment Commitments
2.3		Existing Letters of Credit
4.7(b)		Unrestricted Subsidiaries
4.15		Agreements for Indebtedness
4.21		Real Property
6.17		Post-Closing Actions

Exhibits

 

A		Notice of Borrowing
B		Notice of Continuation/Conversion
C-1		Term A Note
C-2		Term B Note
C-3		Revolving Note
D		Form of Compliance Certificate
E		Form of Solvency Certificate
F		Form of Assignment and Assumption
G		Form of Joinder Agreement

 

v

CREDIT AND GUARANTEE AGREEMENT, dated as of December 8, 2016 (as 2016, as amended and restated as of March 22, 2018 (as it may be further amended, supplemented or otherwise modified, amended and restated, renewed or replaced from time to time, the “ Credit Agreement ”), among (i ) LIONS GATE CAPITAL HOLDINGS LLC, a limited liability company organized under the laws of Delaware (the “New Borrower”), (ii ) LIONS GATE ENTERTAINMENT CORP., a corporation organized under the laws of the province of British Columbia, Canada (the “ Existing Borrower ” or “LGEC” ); ( ii iii ) the Guarantors referred to herein; ( iii iv ) the Lenders referred to herein; and ( iv v ) JPMorgan Chase Bank, N.A., as agent for the Lenders.

PRELIMINARY STATEMENTS

Pursuant to that certain Agreement and Plan of Merger, dated as of June 30, 2016 (as amended, supplemented or modified and in effect from time to time, and including all schedules and exhibits thereto , the “Merger Agreement”), by and among the Borrower, Orion Arm Acquisition Inc., a Delaware corporation and an indirect wholly owned Subsidiary of the Borrower (“Merger Sub”), and Starz, a Delaware corporation (the “Target”), Merger Sub will merge with and into the Target, with the Target surviving such merger as a wholly-owned subsidiary of the Borrower, on the terms and subject to the conditions set forth in the Merger Agreement (the “Acquisition”). The Existing Borrower, the guarantors party thereto, the Existing Lenders party thereto, and the Administrative Agent previously entered into that certain Credit and Guarantee Agreement dated as of December 8, 2016, as amended by that certain Amendment No. 1 dated December 11, 2017 (as amended, restated, supplemented, or otherwise modified from time to time prior to the date hereof, the “Existing Credit Agreement”).

The Borrower has requested New Borrower, the Existing Borrower, the Guarantors referred to herein, the Lenders and Administrative Agent wish to amend and restate the Existing Credit Agreement as provided in this Credit Agreement to give effect to the transactions set forth in the Amendment No. 2 (as defined below) which, among other things, provide that : (i) the Term A Lenders shall extend the Term A Loans to the Borrower on the Closing Restatement Date in an aggregate principal amount of $ 1,000,000,000 pursuant to 750,000,000, having the terms set forth in this Credit Agreement, (ii) the Term B Lenders shall extend the Term B Loans to the Borrower on the Closing Restatement Date in an aggregate principal amount of $ 2,000,000,000 pursuant to 1,250,000,000, having the terms set forth in this Credit Agreement and , (iii) the Revolving Lenders shall provide the Revolving Facility on the Restatement Date in an aggregate principal amount of $ 1,000,000,000 pursuant to this Credit Agreement 1,500,000,000, having the terms set forth in this Credit Agreement, (iv) all term loans and revolving commitments outstanding under the Existing Credit Agreement shall be refinanced, repaid or terminated, as applicable, on the Restatement Date pursuant to Section 2.13 and Section 2.15 of the Existing Credit Agreement, and (v) the Existing Borrower shall, automatically on the Borrower Assignment Effectiveness Date (as defined below), assign all of its rights and all Obligations as Borrower under the Existing Credit Agreement and all Fundamental Documents to the New Borrower and become a Guarantor .

The Lenders have indicated their willingness to lend on the terms and give effect to the transactions set forth in Amendment No. 2 and subject to the conditions set forth herein.

In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows: NOW THEREFORE, effective as of the Restatement Date, the Existing Credit Agreement shall be amended and restated in its entirety to read as follows:

ARTICLE 1 DEFINITIONS

(a) Definitions . The following terms when used herein shall have the following meanings (unless the context otherwise requires, any of the following terms may be used in the singular or the plural, depending on the reference):

“ Acquisition ” shall have the meaning given to such term mean the merger of Merger Sub with and into the Target, with the Target surviving such merger as a wholly-owned subsidiary of LGEC, on the terms and subject to the conditions set forth in the preliminary statements to this Credit Merger Agreement.

“ Additional Assets ” shall mean:

(1) any property, plant, equipment or other assets (excluding working capital or current assets for the avoidance of doubt) to be used by the Borrower LGEC or a Restricted Subsidiary in a Related Business; or

(2) an investment in any one or more businesses or capital expenditures (which for purposes of this definition, shall include the acquisition of any item of Product) and any Permitted Investment, in each case used or useful to a Related Business.

“ Additional Lender ” shall mean any Additional Revolving Lender or any Additional Term Lender, as applicable.

“ Additional Revolving Lender ” shall mean, at any time, any bank or other financial institution that agrees to provide any portion of any Revolving Credit Commitment Increase or Incremental Revolving Credit Facility pursuant to an Incremental Amendment in accordance with Section 2.13; provided that the relevant Persons under Section 11.3 (including those specified in the definition of “Eligible Assignee”) shall have consented to such Additional Revolving Lender’s providing such Commitment Increases, if such consent would be required under Section 11.3 for an assignment of Revolving Credit Commitments to such Additional Revolving Lender.

“ Additional Term Lender ” shall mean, at any time, any bank or other financial institution that agrees to provide any portion of any Term Commitment Increase or Incremental Term Loan pursuant to an Incremental Amendment in accordance with Section 2.13; provided that the relevant Persons under Section 11.3 (including those specified in the definition of “Eligible Assignee”) shall have consented to such Additional Term Lender’s making such Incremental Term Loans, if such consent would be required under Section 11.3 for an assignment of Loans to such Additional Term Lender.

“ Adjusted EBITDA ” shall mean, with respect to any Person for any period, the Consolidated Net Income of such Person for such period plus , without duplication, to the extent the same was deducted in calculating Consolidated Net Income, in each case as to such Person and its Restricted Subsidiaries on a consolidated basis:

(1) Consolidated Taxes; plus

(2) Consolidated Interest Expense; plus

(3) Consolidated Adjusted Charges; plus

 

2

(4) restructuring charges, reserves or expenses and one-time charges (which, for the avoidance of doubt, shall include, without limitation, retention, severance, systems establishment costs, contract termination costs, integration costs and future lease commitments); plus

(5) business optimization expenses; provided that any such business optimization expenses added back pursuant to this clause (5), together with the Non-S-X Adjustment Amount for such period, shall not exceed 15% of Adjusted EBITDA for such period; plus

(6) non-operating expenses (minus non-operating income); plus

(7) charges, costs and expenses relating to any issuance or incurrence of Capital Stock, any incurrence or repayment of Indebtedness or the consummation of any Investment, acquisition or disposition, in each case permitted by this Credit Agreement and whether or not successful, including fees, charges and expenses relating to the Transactions; plus

(8) start-up costs relating to the Comic Con business; plus

(9) other start-up costs in an aggregate amount not to exceed $25,000,000 for the relevant four-quarter reference period;

less , without duplication,

(10) non-cash items increasing Consolidated Net Income for such period (excluding the recognition of deferred revenue or any items which represent the reversal of any accrual of, or cash reserve for, anticipated cash charges in any prior period and any items for which cash was received in a prior period);

provided that effects of purchase accounting adjustments (including the effects of such adjustments pushed down to such Person and such Subsidiaries and including, without limitation, the effects of adjustments to (A) Capitalized Lease Obligations or (B) any other deferrals of income) in amounts required or permitted by GAAP, resulting from the application of purchase accounting or the amortization or write-off of any amounts thereof shall be excluded from the calculation of Adjusted EBITDA.

“ Adjustment Date ” shall have the meaning given to such term in the Applicable Pricing Grid.

“ Amendment No. 1” shall mean Amendment No. 1 to the Existing Credit Agreement dated as of the Amendment No. 1 Effective Date.

“Amendment No. 1 Effective Date” shall mean December 11, 2017.

“Amendment No. 2” shall mean Amendment No. 2 to the Existing Credit Agreement dated as of the Restatement Date.

“Amendment No. 1 Joinder” shall mean the Joinder Agreement dated as of the Amendment No. 1 Effective Date among the Existing Borrower, the Administrative Agent and each Existing Lender party thereto.

 

3

“ Administrative Agent ” shall mean JPMorgan Chase Bank, N.A., in its capacity as agent for the Lenders hereunder or such successor Administrative Agent as may be appointed pursuant to Section 10.10.

“ Administrative Agent Fee Letter ” shall mean the Fee Letter dated as of June 27, 2016 among the Administrative Agent and the Borrower, as amended, supplemented or amended and restated from time to time.

“ Affiliate ” of any specified Person shall mean any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”) when used with respect to any Person means possession, directly or indirectly, of the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

“ Affiliate Transaction ” shall have the meaning given to such term in Section 7.5(a).

“ Affiliated Persons ” mean, with respect to any specified Person, (a) such specified Person’s parents, spouse, siblings, descendants, step children, step grandchildren, nieces and nephews and their respective spouses, (b) the estate, legatees and devisees of such specified Person and each of the Persons referred to in clause (a), and (c) any company, partnership, trust or other entity or investment vehicle controlled by any of the Persons referred to in clause (a) or (b) or the holdings of which are for the primary benefit of any of such Persons.

“ Applicable Law ” shall mean all provisions of statutes, rules, regulations and orders of the United States, England and Wales, the Grand Duchy of Luxembourg or Canada, any state or province thereof or municipality therein or of any foreign governmental body or of any regulatory agency applicable to the Person in question, and all orders and decrees of all courts and arbitrators in proceedings or actions in which the Person in question is a party.

“ Applicable Margin ” shall mean:

(a) with respect to the Term B Loans, (i)  3.00 2.25 % per annum, in the case of a Eurodollar Loan, or (ii)  2.00 1.25 % per annum, in the case of a Base Rate Loan;

(b) with respect to the Term A Loans and the Revolving Loans, (i)  2.50 1.75 % per annum, in the case of a Eurodollar Loan, and (ii)  1.50 0.75 % per annum, in the case of a Base Rate Loan; provided , that on and after the first Adjustment Date occurring after the completion of the first full fiscal quarter of the Borrower LGEC after the Closing Restatement Date, the Applicable Margin with respect to the Term A Loans and the Revolving Loans will be determined pursuant to the Applicable Pricing Grid.

 

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“ Applicable Pricing Grid ” shall mean, with respect to the Term A Loans and the Revolving Loans, the table set forth below:

 

Net First Lien Leverage Ratio		Term A Loans and Revolving Loans Applicable Margin per annum for Eurodollar Loans				Term A Loans and Revolving Loans Applicable Margin per annum for Base Rate Loans
Category 1 Equal or Less than 3.75 to 1.00			2.00 1.75	%			1.00% 0.75	%
Category 2 Equal or less than 4.50 to 1.00 but greater than 3.75 to 1.00			2.25 2.00	%			1.25 1.00	%
Category 3 Greater than 4.50 to 1.00			2.50 2.25	%			1.50 1.25	%

For the purposes of the Applicable Pricing Grid, changes in the Applicable Margin resulting from changes in the Net First Lien Leverage Ratio shall become effective on the date (the “ Adjustment Date ”) that is three Business Days after the date on which financial statements and the related Compliance Certificate are delivered to the Lenders pursuant to Section 6.1(a) and Section 6.1(b) and shall remain in effect until the next change to be effected pursuant to this paragraph. If any financial statements or Compliance Certificate referred to above are not delivered within the time periods specified in Section 6.1(a) and Section 6.1(b), then, until the date that is three Business Days after the date on which such financial statements and Compliance Certificate are delivered, the highest rate set forth in each column of the Applicable Pricing Grid shall apply. In addition, at all times while an Event of Default shall have occurred and be continuing under Section 8.1(a), (f) or (g), the highest rate set forth in each column of the Applicable Pricing Grid shall apply.

In the event that any financial statements under Section 6.1(a) and Section 6.1(b) or the related Compliance Certificate is shown to be inaccurate at any time and such inaccuracy, if corrected, would have led to a higher Applicable Margin for any period (an “ Applicable Period ”) than the Applicable Margin applied for such Applicable Period, then (i)  the Borrower LGEC shall promptly (and in no event later than five (5) Business Days thereafter) deliver to the Administrative Agent a correct Compliance Certificate for such Applicable Period, (ii) the Applicable Margin shall be determined by reference to the corrected Compliance Certificate, and (iii) the Borrower shall pay to the Administrative Agent promptly upon written demand (and in no event later than five (5) Business Days after written demand) any additional interest owing as a result of such increased Applicable Margin for such Applicable Period, which payment shall be promptly applied by the Administrative Agent in accordance with the terms hereof.

“ Application ” shall have the meaning given to such term in Section 2.3(b).

“ Approved Fund ” shall mean any Person (other than a natural person) that is engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“ Approved Jurisdiction ” shall mean (1) the United States or Canada or any state (but not any territory) or province thereof, (2) if elected by the Borrower LGEC , England or Luxembourg or (3) any other jurisdiction approved by the Administrative Agent.

“ Arranger ” shall mean, collectively, the Sole Lead Arranger, Joint Lead Arrangers , Sole Bookrunner and Joint Bookrunners identified on the cover page of this Credit Agreement.

“ Arranger Fee Letter ” shall mean the each Fee Letter dated as of June 27, 2016 among the Existing Borrower , and/or the Administrative Agent, New Borrower and the Arrangers party thereto and the other financial institutions party thereto , entered in connection with the Existing Credit Agreement or Amendment No. 2, as amended, supplemented or amended and restated from time to time.

 

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“ Asset Sale ” shall mean any direct or indirect sale, lease , transfer, issuance or other disposition, or a series of related sales, leases, transfers, issuances or dispositions that are part of a common plan, including any Sale/Leaseback Transaction, of (x) shares of Capital Stock of a Subsidiary (other than directors’ qualifying shares) or (y) other than in the ordinary course of business, other property or other assets (each referred to for the purposes of this definition as a “disposition”) by the Borrower LGEC or any of the Restricted Subsidiaries, including any disposition by means of a merger, amalgamation, consolidation or similar transaction.

Notwithstanding the preceding, the following items shall not be deemed to be Asset Sales:

(1) a disposition of assets by a Restricted Subsidiary to the Borrower LGEC or by the Borrower LGEC or a Restricted Subsidiary to a Restricted Subsidiary; provided that in the case of a sale by a Restricted Subsidiary to another Restricted Subsidiary, the Borrower LGEC directly and/or indirectly owns an equal or greater percentage of the Common Stock of the transferee than of the transferor; provided , that in the case of a disposition of Collateral, the transferee, if a Guarantor subject to the Collateral Documents, shall cause such amendments, supplements or other instruments to be executed, filed, and recorded in such jurisdictions as may be required by Applicable Law to preserve and protect the Lien on the Collateral owned by or transferred to the transferee, together with such financing statements or comparable documents as may be required to perfect any security interests in such Collateral which may be perfected by the filing of a financing statement or a similar document under the UCC, the applicable PPSA, the CCQ, or other similar statute or regulation of the relevant provinces, states or jurisdictions;

(2) the sale of Cash Equivalents or tax credits;

(3) a disposition of inventory, including without limitation, Product (not constituting the sale of a Product that in the aggregate would be considered a “library”), in the ordinary course of business;

(4) a disposition of obsolete or worn out equipment or equipment that is no longer useful in the conduct of the business of the Borrower LGEC and the Restricted Subsidiaries and that is disposed of in each case in the ordinary course of business (including the abandonment of any intellectual property or surrender or transfer for no consideration) or otherwise as may be required pursuant to the terms of any lease, sublease, license or sublicense;

(5) the disposition of all or substantially all of the assets of the Borrower LGEC in a manner permitted under Section 7.6 or any disposition that constitutes a Change of Control;

(6) an issuance of Capital Stock by a Restricted Subsidiary to the Borrower LGEC or to a Wholly-Owned Subsidiary;

(7) any Permitted Investment and any Restricted Payment that is permitted to be made, and is made, under Section 7.2;

(8) dispositions of assets or issuance or sale of Capital Stock of a Restricted Subsidiary in a single transaction or series of related transactions with an aggregate Fair Market Value of less than $20,000,000;

(9) the creation of a Permitted Lien and dispositions in connection with Permitted Liens;

(10) dispositions of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of business or in bankruptcy or insolvency or similar proceedings and exclusive of factoring or similar arrangements;

 

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(11) the issuance by a Restricted Subsidiary of Preferred Stock that is permitted under Section 7.1;

(12) the licensing or sublicensing of intellectual property or other general intangibles and licenses, leases or subleases of other property in the ordinary course of business which do not materially interfere with the business of the Borrower LGEC and the Restricted Subsidiaries;

(13) foreclosure on assets;

(14) any sale of Capital Stock in, Indebtedness or other securities of or Investments in, an Unrestricted Subsidiary;

(15) any exchange of assets (including Capital Stock) (including a combination of assets and Cash Equivalents) for assets (including Capital Stock) related to a Related Business of comparable or greater market value or usefulness to the business of the Borrower LGEC and its Restricted Subsidiaries as a whole, as determined in good faith by the Borrower LGEC ;

(16) sales of Product outside of the ordinary course of business (including the sale of Product that in the aggregate would be considered a “library”) if sold for not less than Fair Market Value and not in excess of $45,000,000 in the aggregate from the Original Closing Date;

(17) sales of all or a portion of an interest in a Foreign Subsidiary that is not a Credit Party, provided that the consideration received is not less than Fair Market Value;

(18) (A) the sale or transfer of Product or intellectual property Product to any ProdCo as part of any Permitted Slate Transaction or (B) any Permitted Slate Financing, including the sale or transfer of any interests in copyrights, distribution rights and/or financial proceeds as contemplated by the definition thereof; and

(19) the creation of revenue participations of the type described in Section 7.1(c)(xvi).

“ Assignment and Assumption ” shall mean an agreement substantially in the form of Exhibit F hereto or such other form as is acceptable to the Administrative Agent, executed by the assignor, assignee and other parties as contemplated thereby.

“ Average Life ” shall mean, as of the date of determination, with respect to any Indebtedness or Preferred Stock, the quotient obtained by dividing (1) the sum of the products of the numbers of years from the date of determination to the dates of each successive scheduled principal payment of such Indebtedness or redemption or similar payment with respect to such Preferred Stock multiplied by the amount of such payment by (2) the sum of all such payments.

“ Bail-In Action ” shall mean the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

“ Bail-In Legislation ” shall mean, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

“ Bankruptcy Code ” shall mean the Bankruptcy Reform Act of 1978, as heretofore and hereafter amended, as codified at 11 U.S.C. § 101 et seq .

 

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“ Bankruptcy Law ” shall mean the Bankruptcy Code, the Companies’ Creditors Arrangement Act (Canada) , the Bankruptcy and Insolvency Act (Canada), the Winding-Up and Restructuring Act (Canada) or other U.S. federal or state law, Canadian federal or provincial law or the law of any other applicable jurisdiction relating to bankruptcy, insolvency, winding up, liquidation, reorganization or relief of debtors or plans of arrangement.

“ Base Rate ” shall mean for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in effect on such day plus  ¹ ⁄ ₂ of 1% and (c) the Eurodollar Rate on such day (or, if such day is not a Business Day, the next preceding Business Day) for a deposit in Dollars with a maturity of one month plus 1.0% , provided that Base Rate with respect to the Term B Facility shall be at all times not less than 1.75% ; provided that for purposes of this definition, the Eurodollar Rate for any day shall be based on the Screen Rate (or if the Screen Rate is not available for such one month Interest Period, the Interpolated Rate) at approximately 11:00 a.m. London time on such day . Any change in the Base Rate due to a change in the Prime Rate, the NYFRB Rate or such Eurodollar Rate shall be effective as of the opening of business on the day of such change in the Prime Rate, the Federal Funds NYFRB Rate or such Eurodollar Rate, respectively. If the Base Rate is being used as an alternate rate of interest pursuant to Section 3.1 hereof, then the Base Rate shall be the greater of clauses (a) and (b) above and shall be determined without reference to clause (c) above. For the avoidance of doubt, if the Base Rate as so determined would be less than zero, such rate shall be deemed to be zero for purposes of this Credit Agreement.

“ Base Rate Loans ” shall mean Loans the rate of interest applicable to which is based upon the Base Rate.

“ Board ” shall mean the Board of Governors of the Federal Reserve System of the United States of America.

“ Board of Directors ” shall mean, as to any Person, the board of directors or managers, as applicable, of such Person (or, if such Person is a partnership, the board of directors or other governing body of the general partner of such Person) or any duly authorized committee thereof.

“ Borrower ” shall have the meaning given to such term in the introductory paragraph of this Credit Agreement. mean, prior to the Borrower Assignment Effectiveness Date, the Existing Borrower, and on and after the Borrower Assignment Effectiveness Date, the New Borrower.

“Borrower Assignment Effectiveness Date” shall mean the Restatement Date but immediately after giving effect to the Term A Loans, Term B Loans and the Revolving Credit Commitments pursuant to Amendment No. 2.

“ Borrowing ” shall mean the total of Loans of a single type advanced, continued for an additional Interest Period, or converted from a different type into such type by the Lenders under the applicable Facility on a single date and, in the case of Eurodollar Loans, for a single Interest Period. Borrowings of Loans are made and maintained ratably from each of the Lenders under the applicable Facility according to their Percentages of such Facility. A Borrowing of Loans is “advanced” on the day Lenders advance funds comprising such Borrowing to the Borrower, is “continued” on the date a new Interest Period for the same type of Loans commences for such Borrowing, and is “converted” when such Borrowing is changed from one type of Loan to the other, all as requested by the Borrower pursuant to Section 2.5(a) hereof. Base Rate Loans and Eurodollar Loans are each a “type” of Loan.

 

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“ Business Day ” shall mean any day other than a Saturday, Sunday or other day on which banks are required or permitted to close in the State of New York, the State of California, the Province of British Columbia or the Province of Ontario.

“ Capital Expenditures ” shall mean, for any period, the aggregate of all expenditures by the Borrower LGEC and the Restricted Subsidiaries for the acquisition or leasing (pursuant to a capital lease) of Product, fixed or capital assets, additions to equipment (including replacements, capitalized repairs and improvements during such period) or other assets that should be capitalized under GAAP on a consolidated balance sheet of the Borrower LGEC and the Restricted Subsidiaries.

“ Capital Stock ” of any Person shall mean any and all shares, interests, rights to purchase, warrants, options, participations or other equivalents of or interests in (however designated) equity of such Person, including any Preferred Stock and limited liability or partnership interests (whether general or limited), but excluding any Indebtedness convertible into such equity.

“ Capitalized Lease Obligations ” shall mean an obligation that is required to be classified and accounted for as a capitalized lease for financial reporting purposes in accordance with GAAP, and the amount of Indebtedness represented by such obligation will be the capitalized amount of such obligation at the time any determination thereof is to be made as determined in accordance with GAAP, and the Stated Maturity thereof will be the date of the last payment of rent or any other amount due under such lease prior to the first date such lease may be terminated without penalty; provided that obligations of Borrower LGEC or the Restricted Subsidiaries, or of a special purpose or other entity not consolidated with Borrower LGEC and the Restricted Subsidiaries, either existing on the Original Closing Date or created thereafter that (a) initially were not included on the consolidated balance sheet of Borrower LGEC as capital lease obligations and were subsequently characterized as capital lease obligations or, in the case of such a special purpose or other entity becoming consolidated with Borrower LGEC and the Restricted Subsidiaries were required to be characterized as capital lease obligations upon such consideration, in either case, due to a change in accounting treatment or otherwise, or (b) did not exist on the Original Closing Date and were required to be characterized as capital lease obligations but would not have been required to be treated as capital lease obligations on the Original Closing Date had they existed at that time, shall for all purposes not be treated as Capitalized Lease Obligations or Indebtedness.

“ Cash Equivalents ” shall mean:

(1) Dollars, Canadian Dollars, pound sterling, euros, the national currency of any member state of the European Union or, in the case of any Foreign Subsidiary, such other local currencies held by it from time to time in the ordinary course of business;

(2) securities issued or directly and fully Guaranteed or insured by the United States, Canada, Switzerland, the United Kingdom or any country that is a member of the European Union, or any agency or instrumentality thereof ( provided that the full faith and credit of the United States is pledged in support thereof), having maturities of not more than two years from the date of acquisition;

(3) marketable general obligations issued by any State of the United States of America or any political subdivision thereof or any Canadian province or any public instrumentality thereof maturing within two years from the date of acquisition and, at the time of acquisition, having a credit rating of “A” or better from either S&P or Moody’s, or carrying an equivalent rating by a nationally recognized Rating Agency, if both of the two named Rating Agencies cease publishing ratings of investments;

 

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(4) certificates of deposit, time deposits, eurodollar time deposits, overnight bank deposits or bankers’ acceptances having maturities of not more than two years from the date of acquisition thereof issued by any commercial bank having a short term deposit rating at the time of acquisition thereof at least “A-2” or the equivalent thereof by S&P, or “P-2” or the equivalent thereof by Moody’s, or carrying an equivalent rating by a nationally recognized Rating Agency, if both of the two named Rating Agencies cease publishing ratings of investments;

(5) repurchase obligations for underlying securities of the types described in clauses (2), (3) and (4) entered into with any bank meeting the qualifications specified in clause (4) above;

(6) commercial paper rated at the time of acquisition thereof at least “A-2” or the equivalent thereof by S&P or “P-2” or the equivalent thereof by Moody’s, or carrying an equivalent rating by a nationally recognized Rating Agency, if both of the two named Rating Agencies cease publishing ratings of investments and in any case maturing within one year after the date of acquisition thereof;

(7) Indebtedness issued by Persons with a rating of “A” or higher from S&P or “A2” or higher from Moody’s (or reasonably equivalent ratings of another internationally recognized ratings agency) in each case with maturities not exceeding two years from the date of acquisition;

(8) interests in any investment company or money market fund which invests 95% or more of its assets in instruments of the type specified in clauses (1) through (7) above; and

(9) instruments equivalent to those referred to in clauses (1) through (8) above denominated in any foreign currency comparable in credit quality and tenor to those referred to above and commonly 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 Subsidiary organized in such jurisdiction.

“ CCQ ” shall mean the Civil Code of Québec as in effect in the province of Québec on the date of execution of this Credit Agreement Original Closing Date (as amended from time to time).

“ Change in Law ” shall mean the occurrence, after the date of this Credit Agreement Restatement Date , of any of the following: (i) the adoption or taking effect of any law, rule, regulation or treaty, (ii) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (iii) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority, in each case not publicly announced before the date of this Credit Agreement Restatement Date ; provided that notwithstanding anything herein to the contrary, (a) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith, and (b) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law,” regardless of the date enacted, adopted or issued.

“ Change of Control ” shall mean:

(i) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than any Permitted Holder, becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that such person or group shall be deemed to have

 

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“beneficial ownership” of all shares that any such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 50% of the total voting power of the Voting Stock of the Borrower LGEC (or its successor by merger, amalgamation, consolidation, plan of arrangement or purchase of all or substantially all of its assets) (for the purposes of this clause, such person or group shall be deemed to beneficially own any Voting Stock of the Borrower LGEC held by a parent entity, if such person or group “beneficially owns” (as defined above), directly or indirectly, more than 50% of the voting power of the Voting Stock of such parent entity);

(ii) the first day on which Continuing Directors cease to constitute a majority of the members of the Board of Directors of the Borrower LGEC or any Permitted Parent Holdco;

(iii) the sale, assignment, lease, transfer, conveyance or other disposition (other than by way of merger, amalgamation, consolidation or plan of arrangement), in one or a series of related transactions, of all or substantially all of the assets of the Borrower LGEC and the Restricted Subsidiaries taken as a whole, to any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) other than any Permitted Holder or a Restricted Subsidiary; or

(iv) LGEC (or its successor by merger, amalgamation, consolidation, plan of arrangement or purchase of all or substantially all of its assets) ceases to own, directly or indirectly, 100% of the voting power of the Voting Stock of the Borrower; or

(v) (iv)  any change of control as defined in the Indenture for the Senior Notes Indenture .

“ Claiming Guarantor ” shall have the meaning given to such term in Section 9.8.

“ Class ” means (a) with respect to Lenders, each of the following classes of Lenders: (i) Lenders having Term A Loan Commitments or outstanding Term A Loans, (ii) Lenders having Term B Loan Commitments or outstanding Term B Loans and (iii) Lenders having Revolving Exposure and (b) with respect to Loans, each of the following classes of Loans: (i) Term A Loans, (ii) Term B Loans and (iii) Revolving Loans.

“Closing Date” shall mean the date on which the conditions precedent set forth in Section 5.1 hereof have been satisfied or waived .

“Closing Date Refinancing” shall mean all existing third party debt for borrowed money of (i) the Borrower and its Subsidiaries under (1) the Second Lien Credit and Guarantee Agreement dated as of March 17, 2015 (as amended, supplemented, modified, renewed or replaced prior to the date hereof) among the Borrower, the guarantors referred to therein, certain lenders parties hereto and JPMorgan Chase Bank, N.A., as administrative agent., (2) the Third Amended and Restated Credit, Security, Guaranty and Pledge Agreement, dated as of September 27, 2012, among LGEI, as borrower, the guarantors referred to therein, the lenders referred to therein, and JPMorgan Chase Bank, N.A., as administrative agent and issuing bank, as amended by Amendment No. 1 thereto, dated as of December 20, 2013, pursuant to which Lions Gate Entertainment Corp. became the borrower thereunder, and as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time prior to the date hereof, and (3) the Borrower’s Senior Secured Second Priority Notes due 2018 which were issued pursuant to that certain Indenture, dated as of July 19, 2013 (as amended, supplemented, modified, renewed or replaced prior to the date hereof), by and among the Borrower, the other guarantors referred to therein and U.S. Bank National Association, as trustee and (ii) the Target and its Subsidiaries under (1) the Credit Agreement, dated as of April 20, 2015 among Starz, LLC, as the borrower, the Bank of Nova Scotia, as administrative agent, and the other parties named therein and (2) the Indenture dated as of September 13, 2012 among Starz, LLC and

 

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Starz Finance Corp. as issuers, the guarantors named therein and U.S. Bank National Association, as trustee, in each case, being repaid, redeemed, defeased, discharged, refinanced or terminated in full and all guarantees and Liens (if any) in respect thereof being terminated and released (or arrangements reasonably satisfactory to the Administrative Agent being in place for the termination and release of such guarantees and Liens).

“ Code ” shall mean the Internal Revenue Code of 1986, as amended.

“ Collateral ” shall mean all property and assets, whether now owned or hereafter acquired, in which Liens are, from time to time, purported to be granted to secure the Obligations pursuant to the Collateral Documents, provided , that notwithstanding anything to the contrary herein or in any Fundamental Document, in no case shall the Collateral include any Excluded Assets.

“ Collateral Account ” shall have the meaning given to such term in Section 8.4(b).

“ Collateral Documents ” shall mean the Pledge and Security Agreement, the Copyright Security Agreement, the Copyright Security Agreement Supplements, the Patent Security Agreement, the Patent Security Agreement Supplements, the Trademark Security Agreement, the Trademark Security Agreement Supplements, the Hypothec, and any other instruments and documents executed and delivered pursuant to this Credit Agreement or any of the foregoing, as the same may be amended, supplemented , reaffirmed (including, without limitation, pursuant to the terms of Amendment No. 2) or otherwise modified from time to time and pursuant to which Collateral is pledged, assigned or granted to or on behalf of the Administrative Agent for the ratable benefit of the Lenders.

“ Comic Con ” shall mean that certain subscription video on demand service (as such service may continue to organically evolve) or other related service operated by the Borrower LGEC , its Subsidiaries or its designees under the name “Comic Con HQ” or other derivation of the word “Comic Con”.

“ Commitment Fee ” shall have the meaning given to such term in Section 2.12(a).

“ Commitment Fee Rate ” shall mean 0.375 0.250 % per annum; provided , that on and after the first Adjustment Date occurring after the completion of the first full fiscal quarter of the Borrower LGEC after the Closing Restatement Date, the Commitment Fee Rate will be determined pursuant to the following grid:

 

Net First Lien Leverage Ratio		Commitment Fee Rate per annum
Category 1 Equal or Less than 3.75 to 1.00			0.250	%
Category 2 Greater than 3.75 to 1.00			0.375	%

If any financial statements are not delivered within the time periods specified in Section 6.1(a) and Section 6.1(b), then, until the date that is three Business Days after the date on which such financial statements are delivered, the highest rate set forth in the grid shall apply. In addition, at all times while an Event of Default shall have occurred and be continuing under Section 8.1(a), (f) or (g), the highest rate set forth in the grid shall apply

“ Commitment Increase ” shall have the meaning given to such term in Section 2.13(a).

 

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“ Commodity Exchange Act ” shall mean the Commodity Exchange Act (7 U.S.C. § 1 et seq. ), as amended from time to time, and any successor statute

“ Common Stock ” shall mean with respect to any Person, any and all shares, interests or other participations in, and other equivalents (however designated and whether voting or nonvoting) of such Person’s common stock whether or not outstanding on the Closing Restatement Date, and includes, without limitation, all series and classes of such common stock.

“Company Material Adverse Effect” shall mean (with all capitalized terms used in this definition of “Company Material Adverse Effect” (other than “Arrangers”), having the meanings ascribed thereto in the Merger Agreement): any event, occurrence, fact, condition, change, development or effect that, individually or in the aggregate, (A) is materially adverse to the business, assets, properties, liabilities, results of operations or condition (financial or otherwise) of the Company and its Subsidiaries, taken as a whole; provided, however, that none of the following shall be deemed in and of themselves, either alone or in combination, to constitute, nor shall any of the following be taken into account (in either case, after giving effect to any event, occurrence, fact, condition, change, development or effect resulting therefrom) in determining whether there has been or will be, a Company Material Adverse Effect: (a) general economic conditions attributable to the U.S. economy or financial or credit markets, or changes therein (including changes in prevailing interest rates, credit availability and liquidity, currency exchange rates, price levels or trading volumes in the United States or foreign securities markets), (b) general political conditions or changes therein (including any changes arising out of acts of terrorism or war, weather conditions or other force majeure events), (c) financial or security market fluctuations or conditions, (d) changes in, or events affecting, the industries in which the Company and its Subsidiaries operate, (e) any effect arising out of a change in GAAP or applicable Law, (f) (1) the announcement, pendency or consummation of the transactions contemplated by the Agreement, (2) any actions required by the Agreement or, if the Company has requested in writing the consent of Parent (with the consent of the Arrangers, not to be unreasonably withheld or delayed, and which the Arrangers will in any case provide (or notify Parent that they will not provide) within two business days of the written request therefor from the Company) to take a specified action that is expressly prohibited by the Agreement and Parent unreasonably withholds its consent thereto, the failure to take such action, or (3) any action taken at the prior written request of Parent (with the consent of the Arrangers, not to be unreasonably withheld or delayed, and which the Arrangers will in any case provide (or notify Parent that they will not provide) within two business days of the written request therefor from the Company) (provided that, for purposes of Sections 3.5(a) and 3.5(b) of the Agreement, events, occurrences, facts, conditions, changes, developments or effects described in subclauses (1) and (2) of this clause (f) shall not be excluded in determining whether a Company Material Adverse Effect has occurred or would reasonably be expected to occur), (g) any changes in the price or trading volume of the Company Common Stock (provided that the events, occurrences, facts, conditions, changes, developments or effects giving rise to or contributing to such change may be taken into account in determining whether a Company Material Adverse Effect has occurred or would reasonably be expected to occur) or (h) any failure by the Company to meet published or unpublished revenue or earning projections (provided that the events, occurrences, facts, conditions, changes, developments or effects giving rise to or contributing to such failure may be taken into account in determining whether a Company Material Adverse Effect has occurred or would reasonably be expected to occur); provided , that in the cases of clauses (a) through (e), any such event, occurrence, fact, condition, change, development or effect which disproportionately affects the Company and its Subsidiaries relative to other participants in the industries in which the Company or its Subsidiaries operate shall not be excluded from the determination of whether there has been a Company Material Adverse Effect, or (B) prevents or materially impairs or delays the ability of the Company to perform its obligations under the Agreement or to consummate the transactions contemplated thereby or would reasonably be expected to do so. Any event, occurrence, fact, condition, change, development or effect that does not constitute a Company Material Adverse Effect under the Agreement due to the scheduling thereof in the Company Disclosure Schedule shall not constitute a Company Material Adverse Effect for purposes of this definition.

 

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“ Complete ” or “ Completed ” or “ Completion ” shall mean with respect to any item of Product, that (1) either (a) sufficient elements have been delivered by the Borrower LGEC or applicable Restricted Subsidiary to, and accepted, deemed or determined to be accepted and/or exploited by, a Person (other than the Borrower LGEC or applicable Restricted Subsidiary or Affiliates thereof) to permit such Person to exhibit the item of Product in the theatrical or other medium for which the item of Product is intended for initial exploitation or (b) an independent laboratory has in its possession a complete final 35 mm or 70 mm (or other size which has become standard in the industry) composite positive print, video master or other equivalent master copy of the item of Product as finally cut, main and end titled, edited, scored and assembled with sound track printed thereon in perfect synchronization with the photographic action and fit and ready for exhibition and distribution in the theatrical or other medium for which the item of Product is intended for initial exploitation, and (2) if such item of Product was acquired by the Borrower LGEC or a Restricted Subsidiary from an unaffiliated third party, the entire acquisition price or minimum advance shall have been paid to the extent then due and there is no condition or event (including, without limitation, the payment of money not yet due) the occurrence of which might result in the Borrower LGEC or such Restricted Subsidiary losing any of its rights in such item of Product.

“ Completion Guarantee ” shall mean, with respect to any item of Product, a completion guarantee, in customary form consistent with the Borrower LGEC ’s past practice or otherwise reasonable and customary for transactions of such nature, which (1) names the production financier to the extent such item of Product is financed in accordance with Sections 7.1(a), Section 7.1(b) or Section 7.1(c)(xii) as a beneficiary thereof to the extent of the Borrower LGEC ’s or applicable Restricted Subsidiary’s financial interest in such item of Product and (2) guarantees that such item of Product will be Completed in a timely manner, or else payment may be made to such production financier of an amount of up to the aggregate amount expended on the production of such item of Product by, or for the account of, the Borrower LGEC or applicable Restricted Subsidiary plus interest on, and other bank charges with respect to, such amount.

“ Compliance Certificate ” shall mean the Compliance Certificate to be delivered pursuant to Section 6.2, substantially in the form of Exhibit D.

“ Consolidated Adjusted Charges ” shall mean, with respect to any Person for any period, the sum, without duplication, of:

(a) depreciation; plus

(b) amortization other than direct operating expenses, as calculated on the Original Closing Date; plus

(c) other non-cash expenses (including, without limitation, stock based compensation expenses including for stock appreciation rights or write-off of deferred financing charges, and non-cash reductions of Consolidated Net Income attributable to consideration paid to any Person in Capital Stock) of such Person and its Restricted Subsidiaries reducing Consolidated Net Income of such Person for such period on a consolidated basis and otherwise determined in accordance with GAAP,

(but for each of clauses (a)-(c) excluding any such charge which consists of or requires an accrual of, or cash reserve for, anticipated cash charges for any future period (other than accruals for stock appreciation rights));

 

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plus

(d) print and advertising expenses (irrespective of whether such Person has actually made a cash payment in respect thereof during such period) for which such Person has an off-setting right of payment and/or guarantee (including, for the avoidance of doubt, any partial guarantee which such Person believes in good faith to be sufficient in size to cover any reasonably anticipated loses from these expenses) from a third-party producer (less the amortization of participation charges that would have been expensed had the print and advertising expense not been expensed in the GAAP financial statements, such amortization to be calculated in accordance with accounting based on the film forecasting method); plus

(e) any non-cash accelerated amortization of programming costs and other intangibles.

For the avoidance of doubt, the amortization of the allocation of the purchase price of a business to increase or decrease the carrying value of the assets and liabilities in accordance with GAAP is considered a non-cash expense.

“ Consolidated Applicable Interest Charge ” shall mean, with respect to any Person for any period, the sum, without duplication, of:

(1) consolidated interest expense of such Person and its Restricted Subsidiaries for such period, to the extent such expense was deducted in computing Consolidated Net Income (including the interest component of Capitalized Lease Obligations, and net payments and receipts (if any) pursuant to interest rate Hedging Obligations and excluding amortization of original issue discount and deferred financing fees and expensing of any bridge or other financing fees); plus

(2) consolidated capitalized interest of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, other than capitalized interest included in the cost of any item of Product; minus

(3) interest income for such period (other than interest income attributable to the discounting of accounts receivable); minus

(4) interest expense accrued as a result of Financial Accounting Standards Board Staff Position No. APB 14-1, to the extent such interest expense was included in clause (1) of this definition.

“ Consolidated Current Assets ” shall mean, at any date, all amounts (other than cash and Cash Equivalents) that would, in conformity with GAAP, be set forth opposite the caption “total current assets” (or any like caption) on a consolidated balance sheet of the Borrower LGEC and the Restricted Subsidiaries at such date.

“ Consolidated Current Liabilities ” shall mean, at any date, all amounts that would, in conformity with GAAP, be set forth opposite the caption “total current liabilities” (or any like caption) on a consolidated balance sheet of the Borrower LGEC and the Restricted Subsidiaries at such date, but excluding (a) the current portion of any Indebtedness of the Borrower LGEC and its Restricted Subsidiaries and (b) without duplication of clause (a) above, all Indebtedness consisting of Revolving Loans to the extent otherwise included therein.

 

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“ Consolidated Debt ” shall mean, as of any date of determination, the sum of (without duplication) the principal amount of all Indebtedness of the type set forth in clauses (1), (2), (3) (other than to the extent undrawn), (5), (6), (7) (to the extent related to any Indebtedness that would otherwise constitute Consolidated Debt) and (8) (to the extent related to any Indebtedness that would otherwise constitute Consolidated Debt) of the definition of “Indebtedness” of the Borrower LGEC and the Subsidiaries determined on a consolidated basis on such date; provided , that the amount of any Indebtedness with respect to which the applicable obligors have entered into currency hedging arrangements shall be calculated giving effect to such currency hedging arrangements and provided further , that neither (i) unfunded commitments for Indebtedness nor (ii) Other Permitted Priority Indebtedness shall be included in the calculation of Consolidated Debt.

“ Consolidated Interest Expense ” shall mean, with respect to any Person for any period, the sum, without duplication, of:

(1) consolidated interest expense of such Person and its Restricted Subsidiaries for such period, to the extent such expense was deducted in computing Consolidated Net Income (including the interest component of Capitalized Lease Obligations and net payments and receipts (if any) pursuant to interest rate Hedging Obligations and including amortization of deferred financing fees, debt issuance costs and expensing of any bridge or other financing fees); plus

(2) consolidated capitalized interest of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, other than capitalized interest included in the cost of any item of Product; minus

(3) interest income for such period (other than interest income attributable to the discounting of accounts receivables).

“ Consolidated Net Income ” shall mean, for any period, the net income (loss) of the Borrower LGEC and its consolidated Restricted Subsidiaries determined on a consolidated basis in accordance with GAAP; provided , however , that there will not be included in such Consolidated Net Income:

(1) any net income (loss) of any Person if such Person is not a Restricted Subsidiary or that is accounted for by the equity method of accounting, except that, subject to the limitations contained in clauses (3) through (6) below, equity of the Borrower LGEC or any Restricted Subsidiary in the net income of any such Person for such period will be included in such Consolidated Net Income up to the aggregate amount of cash actually distributed by such Person during such period to the Borrower LGEC or a Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution to a Restricted Subsidiary, to the limitations contained in clause (2) below);

(2) any net income (but not loss) of any Restricted Subsidiary (other than (i) a Guarantor, (ii) Pilgrim JV and (iii) any other Restricted Subsidiary to the extent any such restriction relates to a Joint Venture, charter or other agreement or instrument entered into by the Borrower LGEC or a Restricted Subsidiary with a minority shareholder to the extent the Borrower LGEC has a call option on such minority shareholder’s Capital Stock) if such Subsidiary is subject to prior government approval or other restrictions due to the operation of its charter or any agreement, instrument, judgment, decree, order statute, rule or government regulation (which have not been waived), directly or indirectly, on the payment of dividends or the making of distributions by such Restricted Subsidiary, directly or indirectly, to the Borrower LGEC , except that, subject to the limitations contained in clauses (3) through (6) below, the Borrower LGEC ’s

 

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equity in the net income of any such Restricted Subsidiary for such period will be included in such Consolidated Net Income up to the aggregate amount of cash that could have been distributed by such Restricted Subsidiary during such period to the Borrower LGEC or another Restricted Subsidiary as a dividend (subject, in the case of a dividend to another Restricted Subsidiary, to the limitation contained in this clause);

(3) any gain or loss (less all fees and expenses relating thereto) realized upon sales or other dispositions of any assets of the Borrower LGEC or such Restricted Subsidiary, other than in the ordinary course of business, as determined in good faith by the Borrower LGEC ;

(4) any after-tax effect of income (loss) from the early extinguishment of Indebtedness or Hedging Obligations or other derivative instruments;

(5) any extraordinary, nonrecurring or unusual gain or loss; and

(6) the cumulative effect of a change in accounting principles.

“ Consolidated Taxes ” shall mean provision for taxes based on income, profits or capital, including, without limitation, state, franchise and similar taxes taken into account in calculating Consolidated Net Income.

“ Consolidated Working Capital ” shall mean, at any date, the excess of Consolidated Current Assets on such date over Consolidated Current Liabilities on such date.

“ Continuing Directors ” shall mean, as of any date of determination, any member of the Board of Directors of the Borrower LGEC or Permitted Parent Holdco, as the case may be, who: (1) was a member of such Board of Directors on the Closing Restatement Date (or, in the case of a Permitted Parent Holdco, the date such Permitted Parent Holdco acquired 100% of the Voting Stock of the Borrower LGEC if the members of the Board of Directors of such Permitted Parent Holdco were approved for the purpose of this definition, on or prior to such date, by a majority of the Continuing Directors of the Borrower LGEC ); or (2) was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of the relevant Board of Directors at the time of such nomination or election.

“ Contributing Guarantor ” shall have the meaning given to such term in Section 9.8 hereof.

“ Controlled Foreign Corporation ” means any Subsidiary that is a “controlled foreign corporation” as defined in Section 957(a) of the Code.

“ Copyright Security Agreement ” shall have the meaning given to such term in the Pledge and Security Agreement.

“ Copyright Security Agreement Supplement ” shall have the meaning given to such term in the Pledge and Security Agreement.

“ Credit Agreement ” shall have the meaning given to such term in the introductory paragraph of this Credit Agreement.

“ Credit Extension ” shall mean the advancing of any Loan or the issuance or extension of, or increase in the amount of, any Letter of Credit.

 

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“ Credit Parties ” shall mean the Borrower and the Guarantors and “ Credit Party ” shall mean any one of them.

“ Currency Agreement ” shall mean in respect of a Person any foreign exchange contract, currency swap agreement, futures contract, option contract or other similar agreement as to which such Person is a party or a beneficiary.

“ Default ” shall mean any event, act or condition which with notice or lapse of time, or both, would constitute an Event of Default.

“ Default Excess ” shall have the meaning given to such term in Section 2.8(d) hereof.

“ Defaulting Lender ” shall mean any Lender, as reasonably determined by the Administrative Agent, that has (a) failed to fund any portion of its Loans within three (3) Business Days of the date required to be funded by it hereunder, unless determined by the Administrative Agent to be the subject of a good faith dispute, (b) notified the Administrative Agent, the Issuing Bank, any Lender (subject to such Lender having given notice thereof to the Administrative Agent) or the Borrower (subject to the Borrower having given notice thereof to the Administrative Agent) in writing that it does not intend to comply with any of its funding obligations under this Credit Agreement or has made a public statement to the effect that it does not intend to comply with its funding obligations under this Credit Agreement or under other agreements in which it commits to extend credit, unless with respect to such other agreements, the Required Lenders determine there to be a good faith dispute, (c) failed, within three (3) Business Days after request by the Administrative Agent, to confirm that it will comply with the terms of this Credit Agreement relating to its obligations to fund prospective Loans, (d) otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within three (3) Business Days of the date when due, unless determined by the Administrative Agent to be the subject of a good faith dispute, (e) (1) on or after the Closing Restatement Date, becomes or is insolvent or has a parent company that becomes or is insolvent, or (2) on or after the Closing Restatement Date, becomes the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has a parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment; provided that a Lender shall not become a Defaulting Lender pursuant to this clause (e) solely as a result of the acquisition or maintenance of an ownership interest in such Lender or Person controlling such Lender, or the exercise of control over such Lender or Person controlling such Lender, in each case by a Governmental Authority or instrumentality thereof, or (f) on or after the Closing Restatement Date, has, or has a direct or indirect parent company that has, become the subject of a Bail-In Action.

“ Designated Non-cash Consideration ” means the Fair Market Value of non-cash consideration received by the Borrower LGEC or a Restricted Subsidiary in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an Officers’ Certificate, setting forth such valuation, less the amount of Cash Equivalents received in connection with a subsequent sale of such Designated Non-cash Consideration.

“ Disqualified Lender ” shall mean (a) banks, financial institutions and other institutional lenders separately identified in writing by the Borrower to the Administrative Agent and made available to the Lenders prior to the Closing Restatement Date and otherwise specified in writing by the Borrower to the Administrative Agent and made available to the Lenders from time to time (it being understood that any update shall not apply retroactively to disqualify any Person that has previously acquired an assignment or participation interest in the Loans), (b) any competitors of the Borrower LGEC , the Target or their

 

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respective Subsidiaries that were separately identified in writing by the Borrower to the Administrative Agent made available to the Lenders (it being understood that any update shall not apply retroactively to disqualify any Person that has previously acquired an assignment or participation interest in the Loans), and (c) in the case of each of the entities covered by clauses (a) and (b), any of their Affiliates (other than bona fide debt funds) that are either (i) identified in writing by the Borrower to the Administrative Agent and made available to the Lenders from time to time or (ii) clearly identifiable solely on the basis of the similarity of such Affiliate’s name to an entity so identified pursuant to clause (a) or (b) . In no event shall the Administrative Agent be obligated to ascertain, monitor or inquire as to whether any prospective assignee , participant or other transferee is a Disqualified Lender or have any liability with respect to any assignment or participation made to a Disqualified Lender . The Administrative Agent shall have the right, and the Borrower hereby expressly authorizes the Administrative Agent, to provide the DQ List to each Lender requesting the same .

“ Disqualified Stock ” shall mean, with respect to any Person, any Capital Stock of such Person that 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:

(1) matures or is mandatorily redeemable pursuant to a sinking fund obligation or otherwise;

(2) is convertible into or exchangeable for Indebtedness or Disqualified Stock (excluding Capital Stock which is convertible or exchangeable solely at the option of the Borrower LGEC or a Restricted Subsidiary (it being understood that upon such conversion or exchange it shall be an Incurrence of such Indebtedness or Disqualified Stock)); or

(3) is redeemable at the option of the holder of the Capital Stock in whole or in part, in each case on or prior to the date that is 91 days after the earlier of (a) the Final Maturity Date or (b) the date on which there are no Loans and no Revolving Credit Commitments outstanding, provided , however , that only the portion of Capital Stock which so matures or is mandatorily redeemable, is so convertible or exchangeable or is so redeemable at the option of the holder thereof prior to such date will be deemed to be Disqualified Stock; provided , further , that any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require the Borrower LGEC or its Subsidiaries to repurchase such Capital Stock upon the occurrence of a change of control or asset sale (each defined in a substantially identical manner to the corresponding definitions in this Credit Agreement) shall not constitute Disqualified Stock if the terms of such Capital Stock (and all such securities into which it is convertible or for which it is ratable or exchangeable) provide that the Borrower LGEC or its Subsidiaries, as applicable, may not repurchase or redeem any such Capital Stock (and all such securities into which it is convertible or for which it is ratable or exchangeable) pursuant to such provision prior to the termination of the Facilities.

“ Distribution Agreements ” shall mean (i) any and all agreements entered into by a Credit Party pursuant to which such Credit Party has sold, leased, licensed or assigned distribution rights or other exploitation rights to any item of Product to a Person that is not an Affiliate of such Credit Party and (ii) any and all agreements hereafter entered into by a Credit Party pursuant to which such Credit Party sells, leases, licenses or assigns distribution rights or other exploitation rights to any item of Product to a Person that is not an Affiliate of such Credit Party.

“ Dollars ” and “ $ ” shall mean dollars in lawful currency of the United States of America.

“ ECF Payment ” shall have the meaning given to such term in Section 2.8(c)(iii).

 

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“ EEA Financial Institution ” shall mean (a) any institution established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

“ EEA Member Country ” shall mean any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

“ EEA Resolution Authority ” shall mean any public administrative authority or any Person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

“ Eligible Assignee ” shall mean (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund, and (d) any other Person (other than a natural person or a holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural person) approved in writing by (i) the Administrative Agent, (ii) in the case of any assignment of a Revolving Credit Commitment, the Issuing Banks, and (iii) unless an Event of Default described in Section 8.1(a), (f) or (g) has occurred and is continuing, the Borrower (each such approval not to be unreasonably withheld or delayed); provided that, in the case of assignments of Term B Loans, the Borrower shall be deemed to have consented to any such assignment unless it shall object thereto by written notice to the Administrative Agent within ten (10) Business Days after having received written notice from the Administrative Agent of such request for its consent; provided further that, notwithstanding the foregoing, (A) “Eligible Assignee” shall not include (x) any Disqualified Lenders, (y) any natural person or any holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural person or (z) except as provided in Section 11.3, the Borrower LGEC or any Subsidiary of the Borrower LGEC and (B) in the case of assignments of Revolving Credit Commitments or Revolving Exposure, no Person shall be an Eligible Assignee pursuant to clause (a), (b) or (c) above unless such Person is, or is an Affiliate or an Approved Fund of, an existing Lender under the Revolving Facility.

“ Environmental Laws ” shall mean any and all federal, state, provincial, local or municipal laws, rules, orders, regulations, statutes, ordinances, codes, decrees or requirements of any Governmental Authority regulating, relating to, or imposing liability or standards of conduct concerning, any Hazardous Material or environmental protection or health and safety, as now or at any time hereafter in effect, including without limitation, the Clean Water Act also known as the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq ., the Clean Air Act, 42 U.S.C. §§ 7401 et seq ., the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. §§ 136 et seq ., the Surface Mining Control and Reclamation Act, 30 U.S.C. §§ 1201 et seq ., the Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq ., the Superfund Amendments and Reauthorization Act of 1986, Public Law 99-499, 100 Stat. 1613, the Emergency Planning and Community Right to Know Act, 42 U.S.C. § 11001 et seq ., the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq ., the Occupational Safety and Health Act as amended, 29 U.S.C. § 655 and § 657, the Waste Management Act, R.S.B.C. 1996, c. 481, the Transportation of Dangerous Goods Act, R.S.B.C. 1996, c. 458 and other such laws relating to the storage, transportation, treatment and disposal of Hazardous Materials into the air, surface water, ground water, land surface, subsurface strata or any building or structure and, together, in each case, with any amendment thereto, and the regulations adopted pursuant thereto.

“ Equity Cure Period ” shall have the meaning given to such term in Section 8.6.

“ ERISA ” shall mean the Employee Retirement Income Security Act of 1974, as heretofore and hereafter amended, as codified at 29 U.S.C. § 1001 et seq . and the regulations promulgated thereunder.

 

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“ ERISA Affiliate ” shall mean any trade or business (whether or not incorporated) which is under common control with any Credit Party under Section 4001 of ERISA or which is treated as a single employer under Section 414(b), (c), (m) or (o) of the Code.

“ ERISA Event ” shall mean:

(a) the failure of any Plan to be maintained and operated in all respects in accordance with all Applicable Laws, including ERISA;

(b) the present value of all benefits under a Title IV Plan exceed the actuarial value of the assets of such Title IV Plan allocable to such benefits (based on those assumptions used to fund such Title IV Plan) as of the last valuation date applicable thereto;

(c) any event described in Section 4043(c) of ERISA and the regulations promulgated thereunder with respect to a Title IV Plan (other than an event for which the thirty (30) day notice period is waived);

(d) the imposition of any liability, or the existence of any circumstances pursuant to which any liability could be imposed, upon any Credit Party or any of their respective ERISA Affiliates under Chapter 43 of the Code with respect to any Title IV Plan or Multiemployer Plan, or with respect to any Plan that provides post retirement welfare coverage (other than as required pursuant to Section 4980B of the Code);

(e) the withdrawal of any Credit Party or ERISA Affiliate from a Title IV Plan subject to Section 4063 of ERISA during a plan year in which it was a substantial employer, as defined in Section 4001(a)(2) of ERISA;

 

(f)	the complete or partial withdrawal of any Credit Party or any ERISA Affiliate from any Multiemployer Plan;

(g) the filing of a notice of intent to terminate a Title IV Plan or the treatment of a plan amendment as a termination under Section 4041 of ERISA;

(h) the termination of a Title IV Plan or Multiemployer Plan by the PBGC pursuant to Section 4042 of ERISA;

(i) the failure by any Credit Party or ERISA Affiliate to make when due required contributions to a Multiemployer Plan or Title IV Plan;

(j) the termination of a Multiemployer Plan under Section 4041A of ERISA or the insolvency of a Multiemployer Plan under Section 4245 of ERISA or a determination that a Multiemployer Plan is in “endangered”, “critical” or “critical and declining” status under the meaning of Section 432 of the Code or Section 304 or 305 of ERISA;

(k) the termination of a Plan described in Section 4064 of ERISA;

(l) the failure to satisfy the minimum funding standards (within the meaning of Section 412 of the Code or Section 302 of ERISA), whether or not waived, with respect to any Title IV Plan;

 

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(m) a determination that any Title IV Plan is or is expected to be in “at risk” status (within the meaning of Section 430 of the Code or Section 303 of ERISA);

(n) the incurrence by any Credit Party or any of its ERISA Affiliates of any liability under Title IV of ERISA (other than non-delinquent premiums payable to the PBGC under Sections 4006 and 4007 of ERISA);

(o) the imposition of liability on any Credit Party or any ERISA Affiliate due to the cessation of operations at a facility under the circumstances described in Section 4062(e) of ERISA,

(p) the occurrence of a non-exempt “prohibited transaction” with respect to which any Credit Party or any of the Subsidiaries is a “disqualified person” (within the meaning of Section 4975 of the Code) or a “party in interest” (within the meaning of Section 406 of ERISA) or with respect to which any Credit Party or any such Subsidiary could otherwise be liable.

“ ERISA Lien ” shall mean any Liens under ERISA or Section 412 of the Code.

“ EU Bail-In Legislation Schedule ” shall mean the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor Person), as in effect from time to time.

“ Eurocurrency Reserve Requirements ” shall mean for any day as applied to a Eurodollar Loan, the aggregate (without duplication) of the rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including basic, supplemental, marginal and emergency reserves) under any regulations of the Board or other Governmental Authority having jurisdiction with respect thereto dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D) maintained by a member bank of the Federal Reserve System.

“ Eurodollar Base Rate ” shall mean with respect to any Eurodollar Loan for any Interest Period, a rate per annum equal to the London interbank offered rate as administered by the ICE Benchmark Administration (or any other Person that takes over the administration of such rate) for Dollars for a period equal in length to such Interest Period as displayed on pages LIBOR01 or LIBOR02 of the Reuters Screen that displays such rate (or, in the event such rate does not appear on either of such Reuters pages, on any successor or substitute page on such screen that displays such rate, or on the appropriate page of such other information service that publishes such rate from time to time as selected by the Administrative Agent in its reasonable discretion; in each case, the “ Screen Rate ”) as of the Specified Time on the Quotation Day for such Interest Period; provided that if the Screen Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Credit Agreement; provided , further , that if the Screen Rate shall not be available at such time for such Interest Period (an “ Impacted Interest Period ”) with respect to Dollars, then the Eurodollar Base Rate shall be the Interpolated Rate at such time ( provided that if the Interpolated Rate shall be less than zero, such rate shall be deemed to be zero for purposes of this Credit Agreement) and, provided, further, provided, that the Eurodollar Base Rate with respect to the Term B Facility shall be at all times not less than 0.75% .

“ Eurodollar Loans ” shall mean Loans the rate of interest applicable to which is based upon the Eurodollar Rate.

 

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“ Eurodollar Rate ” shall mean with respect to each day during each Interest Period pertaining to a Eurodollar Loan, a rate per annum determined for such day in accordance with the following formula:

 

		Eurodollar Base Rate
		1.00 - Eurocurrency Reserve Requirements

“ Event of Default ” shall have the meaning given to such term in Section 8.1.

“ Event of Loss ” shall mean, with respect to any property or other assets, any of the following: (a) any loss, destruction or damage of such property or other assets or (b) any condemnation, seizure, or taking, by exercise of the power of eminent domain or otherwise, of such property or other assets, or confiscation of such property or other assets, provided that to the extent that any property or assets subject to any such event would not have, if sold or disposed of immediately prior to such event, constituted an “Asset Sale” hereunder, such event will not constitute an “Event of Loss” for all purposes hereunder.

“ Excess Cash Flow ” shall mean, for any fiscal year of the Borrower LGEC , 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 depreciation and amortization, including but not limited to amortization of film and television programs and programming rights, deferred financing costs or other non-cash interest, non-cash stock based compensation, or deferred tax provision) deducted in arriving at such Consolidated Net Income;

(iii) decreases in Consolidated Working Capital for such fiscal year ( provided that , for purposes of this clause (a)(iii) and clause (b)(iv) below, Consolidated Working Capital shall exclude the current portion of programming costs and tax credits receivable on film production);

(iv) the aggregate net amount of non-cash loss on Asset Sales by the Borrower LGEC and its Restricted Subsidiaries during such fiscal year, to the extent deducted in arriving at such Consolidated Net Income; and

(v) amounts received by the Borrower LGEC and its Restricted Subsidiaries during such fiscal year and included in deferred revenue which are not expected to be recognized within a year and thus are excluded from Consolidated Working Capital;

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 LGEC and its Restricted Subsidiaries in cash during such fiscal year on account of Capital Expenditures (excluding the principal amount of Indebtedness incurred to finance such Capital Expenditures and any such Capital Expenditures financed with the proceeds of any Reinvested Deferred Amount);

 

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(iii) the aggregate amount of voluntary or mandatory payments or repurchases made or otherwise paid by the Borrower LGEC and its Restricted Subsidiaries during such period in respect of all principal on all Indebtedness, which payments are not prohibited under this Credit Agreement at the time made (whether such payment is made at maturity, as a result of mandatory or voluntary prepayment, acceleration or otherwise, but excluding (i) the principal amount of Indebtedness incurred to finance such payments or repurchases, (ii) the voluntary prepayments deducted pursuant to Section 2.8(c)(iii)(B) and (iii) payments of revolving loans or swingline loans to the extent not accompanied with a permanent reduction of commitments thereunder);

(iv) increases in Consolidated Working Capital for such fiscal year;

(v) the aggregate amount of spending by the Borrower LGEC and its Restricted Subsidiaries on investment in film and television programs or programing rights net of (A) borrowings and repayments on production loans and (B) tax credits received, in each case by the Borrower LGEC and its Restricted Subsidiaries in such fiscal year;

(vi) any amounts utilized by the Borrower LGEC and its Restricted Subsidiaries subsequent to the applicable fiscal year and prior to the calculation of Excess Cash Flow to make payments on production loans relating to Product released before the end of such fiscal year;

(vii) the aggregate net amount of non-cash gain on Asset Sales by the Borrower LGEC and its Restricted Subsidiaries during such fiscal year, to the extent included in arriving at such Consolidated Net Income;

(viii) Revenue amounts included in Consolidated Net Income for such fiscal year which are not expected to be paid within a year and thus are excluded from Consolidated Working Capital;

(ix) Payments made by the Borrower LGEC and its Restricted Subsidiaries during such fiscal year to pay tax liabilities incurred by current or former officers, directors and employees of the Borrower LGEC and its Subsidiaries upon the vesting of equity interests of any kind held thereby, including restricted stock units; and

(x) any amounts included in the Consolidated Net Income attributable to the net income of any Subsidiary which is not a Wholly-Owned Subsidiary pursuant to clause (2) of the definition of Consolidated Net Income to the extent (and only for so long as) the distribution or dividend of such amounts to the Borrower or a Guarantor is subject to prior government approval or other restrictions due to the operation of such Subsidiary’s charter or any agreement, instrument, judgment, decree, order statute, rule or government regulation, directly or indirectly, on the payment of dividends or the making of distributions by such Restricted Subsidiary, directly or indirectly, to the Borrower LGEC .

“ Exchange Act ” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.

“ Excluded Assets ” shall mean:

(1) the Fractional Aircraft Interest;

 

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(2) interests in the Headquarters JV;

(3) any Capital Stock or other equity interests owned by the Borrower or any Guarantor to the extent that, and for so long as, a pledge of such Capital Stock or other equity interests would violate Applicable Law or an enforceable contractual obligation binding on or relating to such Capital Stock or other equity interests;

(4) rights of any of the Borrower or any Guarantor under any license, contract or agreement or any property subject to a purchase money security interest or similar arrangement to the extent that pursuant to the terms of such license, contract, agreement, purchase money arrangement or similar arrangement the granting of a security interest in such rights would result in a termination or right of termination of, or is otherwise prohibited under, such agreement by the other party thereto, but only to the extent such prohibition on assignment is enforceable; provided , however , that upon the ineffectiveness, lapse or termination of any such provision, the Collateral shall include, and such Person shall be deemed to have granted a security interest in, all such rights and interests as if such provision had never been in effect;

(5) any other assets to the extent that, and for so long as, taking a security interest in such assets would violate any Applicable Law or regulation or an enforceable contractual obligation binding on the assets that existed at the time of the acquisition thereof and was not created or made binding on the assets in contemplation of or in connection with the acquisition of such assets;

(6) any leasehold interest in real property ;

(7) any fee interest in real property with a Fair Market Value of $15,000,000 or less individually;

(8) motor vehicles and other assets subject to certificates of title;

(9) assets to the extent a security interest in such assets would result in a material adverse tax consequence (including as a result of the operation of Section 956 of the Code or any similar law or regulation in any applicable jurisdiction) as reasonably determined by the Borrower LGEC ;

(10) those assets as to which the Administrative Agent and the Borrower LGEC reasonably agree that the cost of obtaining such a security interest or perfection thereof are excessive in relation to the benefit to the Secured Parties of the security to be afforded thereby, including those assets set forth on Schedule 1.2 hereto;

(11) any of the Capital Stock of Subsidiaries not owned directly by a Credit Party;

(12) any governmental licenses or state or local franchises, charters and authorizations, to the extent security interests in such licenses, franchises, charters or authorizations are prohibited or restricted thereby after giving effect to the applicable anti-assignment provisions of the UCC;

(13) “intent-to-use” trademark applications;

(14) letter of credit rights (except to the extent a security interest therein can be perfected by the filing of UCC financing statements);

 

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(15) any commercial tort claim with a value not in excess of $15,000,000 individually;

(16) voting equity interests (and any other interests constituting “stock entitled to vote” within the meaning of U.S. Treasury Regulations Section 1.956-2(c)(2)) in excess of 65% of all such voting equity interests (and “stock entitled to vote”) in (i) any Controlled Foreign Corporation, (ii) any FSHCO and (iii) any subsidiary that is a disregarded entity for U.S. federal income tax purposes and owns any equity interests (or any other interests constituting “stock entitled to vote” within the meaning of U.S. Treasury Regulations Section 1.956-2(c)(2)) in a Controlled Foreign Corporation or FSHCO; and

(17) any demand deposit account established by a Credit Party at a commercial bank for the sole purpose of paying the production costs of a particular item of Product (or, in connection with any Permitted Slate Financing, the audio visual works (including motion pictures) to which such Permitted Slate Financing relates) in the ordinary course of business (each, a “ Production Account ”).

“ Excluded Contributions ” shall mean Net Cash Proceeds received by the Borrower LGEC from:

(1) contributions to its common equity capital; or

(2) the sale (other than to a Subsidiary of the Borrower LGEC or to any management equity plan or stock option plan or any other management or employee benefit plan or agreement of the Borrower LGEC or any Subsidiary) of Capital Stock (other than Disqualified Stock) of the Borrower LGEC ;

in each case designated as Excluded Contributions pursuant to an Officers’ Certificate executed by the principal financial officer of the Borrower LGEC on the date such capital contributions are made or the date such equity interests are sold, as the case may be.

“ Excluded Subsidiary ” shall mean any of the following:

(a) each Immaterial Subsidiary;

(b) each Subsidiary that is not a Wholly-Owned Subsidiary ;

(c) each Subsidiary that is prohibited from guaranteeing or granting Liens to secure the Obligations by any Applicable Law or that would require consent, approval, license or authorization of a Governmental Authority to guarantee or grant Liens to secure the Obligations (unless such consent, approval, license or authorization has been received);

(d) each Subsidiary that is prohibited by any applicable contractual requirement (not created in contemplation of the acquisition by the Borrower LGEC of such Subsidiary) from Guaranteeing or granting Liens to secure the Obligations on the Original Closing Date or at the time such Subsidiary becomes a Subsidiary not in violation of Section 7.4 (and for so long as such restriction or any replacement or renewal thereof is in effect);

(e) any Subsidiary which engages in no activities other than in connection with the financing of accounts receivable ;

 

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(f) (f)  any Foreign Subsidiary of in which any Subsidiary organized in the United States, any state thereof, or the District of Columbia owns (within the meaning of Section 958(a) of the Code) any equity interest or Capital Stock ;

(g) (g)  any U.S. Subsidiary (i) that is an FSHCO or (ii) that is a Subsidiary of a Controlled Foreign Corporation;

(h) (f)  any Foreign Subsidiary other than a Subsidiary which is organized in Canada or any province thereof other than Lions Gate International Motion Pictures S.A.R.L.;

(i) (g)  any other Subsidiary with respect to which the Administrative Agent and the Borrower LGEC reasonably agree that the cost or other consequences (including, without limitation, tax consequences (including as a result of the operation of Section 956 of the Code or any similar Applicable Law in any applicable jurisdiction)) of providing a guarantee of or granting Liens to secure the Obligations are likely to be excessive in relation to the value to be afforded thereby;

(j) (h)  any other Subsidiary if in the reasonable good faith determination of the Borrower LGEC in consultation with the Administrative Agent, a guarantee by such Subsidiary would result in materially adverse tax consequences to the Borrower LGEC or any of its Subsidiaries;

(k) (i)  each Unrestricted Subsidiary;

(l) (j)  any Subsidiary that is a “captive” insurance company;

(m) (k)  not-for-profit Subsidiaries;

(n) (l)  Subsidiaries which are Special Purpose Producers to the extent that (i) such Special Purpose Producer (A) has incurred (or is reasonably expected in connection with the financing plan for such Special Purpose Producer to incur) production loans or any Other Permitted Priority Indebtedness or (B)(I) was formed for the purpose of holding or collecting tax credits in connection with the applicable production and (II) has guaranteed or granted liens on any of its assets to secure, or is reasonably expected to guarantee or grant liens on its assets to secure, the applicable production loan or any Other Permitted Priority Indebtedness and (ii) all distribution and other exploitation rights in the relevant Product or the audio-visual product or live or location-based entertainment produced by such Special Purpose Producer are licensed to a Credit Party; and

(o) (m)  any ProdCo.

“ Excluded Swap Obligation ” shall mean, with respect to any Credit Party, any obligation to pay or perform under any Hedging Obligation if, and to the extent that, and only for so long as, all or a portion of the guarantee of such Credit Party of, or the grant by such Credit Party of a security interest to secure, as applicable, such Hedging Obligations (or any guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation, or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of (a) such Credit Party’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder or (b) in the case of a Hedging Obligation subject to a clearing requirement pursuant to Section 2(h) of the Commodity Exchange Act (or any successor provision thereto), because

 

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such Guarantor is a “financial entity,” as defined in Section 2(h)(7)(C)(i) of the Commodity Exchange Act (or any successor provision thereto), in each case the time the guarantee given by such Credit Party or the grant of such security interest, as applicable, becomes effective with respect to such Hedging Obligation. If a Hedging Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Hedging Obligation that is attributable to swaps for which such guarantee or security interest is or becomes illegal.

“ Excluded Taxes ” shall mean taxes imposed on or with respect to a Person or required to be withheld or deducted from a payment to a Person pursuant to this Credit Agreement or any other Fundamental Document: (1) where such Person is subject to such taxes by reason of its carrying on business (other than any taxes arising solely from such Lender having entered into this Credit Agreement) in the jurisdiction imposing such tax (the “Relevant Taxing Jurisdiction”), having a permanent establishment in the Relevant Taxing Jurisdiction, being organized under the laws of the Relevant Taxing Jurisdiction or a subdivision thereof, or being an actual or deemed resident in the Relevant Taxing Jurisdiction; (2) by reason of such Person not dealing at arm’s length with the Borrower or any Guarantor for any purpose, including pursuant to the Income Tax Act (Canada) or any applicable income tax treaty; (3) by reason of the failure of such Person to complete, execute and deliver to the Borrower or the applicable Guarantor any form or document to the extent applicable to such Person that may be required by law or by reason of administration of such law or which is reasonably requested in writing to be delivered to the Borrower or such Guarantor in order to enable the Borrower or such Guarantor to make any payments hereunder or under any other Fundamental Document without deduction or withholding for taxes, or with deduction or withholding of a lesser amount, which form or document shall be delivered prior to the date on which the relevant payment is made; or (4) in respect of any taxes imposed under FATCA.

“ Existing Borrower” shall have the meaning given to such term in the introductory paragraph of this Credit Agreement.

“Existing Convertible Notes ” shall mean ( a 1 ) the 4.00% Convertible Senior Subordinated Notes Due 2017 dated as of January 11, 2012 and related Guarantees issued under the Indenture dated as of January 11, 2012 among the Borrower LGEC , LGEI and The Bank of New York Mellon Trust Company, N.A. ; , and ( b 2 ) the 1.25% Convertible Senior Subordinated Notes Due 2018 dated as of April 15, 2013 and related Guarantees issued under the Indenture dated as of April 15, 2013 among the Borrower LGEC , LGEI and U.S. Bank National Association.

“Existing Credit Agreement” shall have the meaning given to such term in the preliminary statements of this Credit Agreement.

“Existing Lenders” shall mean the several banks and other financial institutions and other lenders from time to time party to the Existing Credit Agreement.

“Existing Revolving Loans” shall have the meaning given to such term in Amendment No. 2.

“Existing Term Loans” shall have the meaning given to such term in Amendment No. 2.

“ Extended Revolving Credit Commitment ” shall have the meaning given to such term in Section 2.14(a)(ii).

“ Extended Revolving Loans ” shall have the meaning given to such term in Section 2.14(a)(ii).

 

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“ Extended Term Loans ” shall have the meaning given to such term in Section 2.14(a)(ii).

“ Extension ” shall have the meaning given to such term in Section 2.14(a).

“ Extension Offer ” shall have the meaning given to such term in Section 2.14(a).

“ Facility ” shall mean any of the Revolving Facility and any Term Facility.

“ Fair Market Value ” shall mean, with respect to any asset or liability, the fair market value of such asset or liability as determined by the Borrower LGEC in good faith.

“ FATCA ” shall mean Sections 1471 through 1474 of the Code, as of the date of this Credit Agreement Restatement Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof any agreements entered into pursuant to Section 1471(b)(1) of the Code and any intergovernmental agreements between the United States and any other jurisdiction entered into in connection with the foregoing (including any treaty, law, regulation or other official guidance adopted pursuant to any such intergovernmental agreement).

“ Federal Funds Rate ” shall mean, for any day, the rate calculated by the NYFRB based on such day’s federal funds transactions by depositary institutions, as determined in such manner as the NYFRB shall set forth on its public website from time to time, and published on the next succeeding Business Day by the NYFRB as the federal funds effective rate.

“ Fee Letters ” shall mean the Arranger Fee Letter and , the Administrative Agent Fee Letter and the Arranger Fee Letters .

“ Fee Payment Date ” shall mean (a) the third Business Day following the last day of each March, June, September and December and (b) the final maturity date for the Revolving Facility.

“ Final Maturity Date ” shall mean, as at any date, the latest to occur of (a) the Term A Termination Date, (b) the Term B Termination Date, (c) the latest maturity date in respect of any outstanding Extended Term Loans and (d) the latest maturity date in respect of any Incremental Term Loans.

“ Final Revolving Credit Termination Date ” shall mean, as at any date, the latest to occur of (a) the Revolving Credit Termination Date, (b) the latest termination date in respect of any outstanding Extended Revolving Credit Commitments and (c) the latest termination date in respect of any Incremental Revolving Credit Facility.

“ FinanceCo ” means LG FinanceCo Corp., a British Columbia corporation and a direct Wholly-Owned Subsidiary of the Borrower LGEC .

“ Fixed Dollar Incremental Amount ” shall have the meaning given to such term in Section 2.14(b).

“ Flood Insurance Laws ” shall mean, collectively, (i) National Flood Insurance Reform Act of 1994 (which comprehensively revised the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973) as now or hereafter in effect or any successor statute thereto, (ii) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statute there-to and (iii) the Biggert-Waters Flood Insurance Reform Act of 2012 as now or hereafter in effect or any successor statute thereto.

 

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“ Foreign Subsidiary ” shall mean any Restricted Subsidiary that is not organized under the laws of the United States of America or any state thereof or the District of Columbia and any Subsidiary of such Restricted Subsidiary.

“ Fractional Aircraft Interest ” shall mean a fractional interest in an executive jet aircraft and/or a single purpose trust formed solely to hold such interest, with an acquisition cost for such interest or such trust which may not exceed $10,000,000.

“ FSHCO ” shall mean any Subsidiary that owns no material assets (directly or through subsidiaries) other than equity interests (and any other interests constituting “stock entitled to vote” within the meaning of U.S. Treasury Regulations Section 1.956-2(c)(2)) of one or more Controlled Foreign Corporations.

“ Fundamental Documents ” shall mean this Credit Agreement, the Notes, the Collateral Documents, each Refinancing Amendment and , each Incremental Amendment . , Amendment No. 1, Amendment No. 1 Joinder and Amendment No. 2.

“ GAAP ” shall mean generally accepted accounting principles in the United States of America as in effect from time to time, including those set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as approved by a significant segment of the accounting profession, subject in all cases to paragraph (c) below of this Article 1. All ratios and computations based on GAAP contained in this Credit Agreement will be computed in conformity with GAAP, except that in the event the Borrower LGEC is acquired in a transaction that is accounted for using purchase accounting, the effects of the application of purchase accounting shall be disregarded in the calculation of such ratios and other computations contained in this Credit Agreement.

“ Governmental Authority ” shall mean any federal, state, provincial, municipal or other governmental department, commission, board, bureau, agency or instrumentality, or any court, in each case whether of the United States, Canada, Luxembourg or any foreign jurisdiction.

“ Guarantee ” shall mean any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any other Person and any obligation, direct or indirect, contingent or otherwise, of such Person:

(1) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by agreement to keep well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise); or

(2) entered into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided , however , that the term “Guarantee” will not include endorsements for collection or deposit or for indemnification in the ordinary course of business. The term “Guarantee” used as a verb has a corresponding meaning.

“ Guarantors ” shall mean LGEC (on and after the Borrower Assignment Effectiveness Date) and each Restricted Subsidiary which is a signatory of this Credit Agreement (including as signatory to Amendment No. 2, and including the Initial LUX/UK Guarantors) as a Guarantor and any other direct or indirect Restricted Subsidiary acquired or created after the date hereof which becomes a signatory to this Credit Agreement as a Guarantor pursuant to Section 6.13.

 

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“ Hazardous Materials ” shall mean any flammable materials, explosives, radioactive materials, hazardous materials, hazardous wastes, hazardous or toxic substances, or similar materials defined in any Environmental Law.

“ Headquarters JV ” shall mean either (i) LGJW Colorado Partners, LLC or (ii) any other entity which is directly or indirectly owned in whole or in part by the Borrower LGEC and which is formed for the sole purpose of constructing, maintaining and owning an office building to be used as a headquarters of the Borrower LGEC and/or Subsidiaries thereof.

“ Hedging Obligations ” of any Person shall mean the obligations of such Person pursuant to any Interest Rate Agreement or Currency Agreement.

“ Hypothec ” shall have the meaning given to such term in the Pledge and Security Agreement.

“ Immaterial Subsidiary ” shall mean any Subsidiary that (a) did not, as of the last day of the fiscal quarter of the Borrower LGEC most recently ended for which financial statements have been (or were required to be) delivered pursuant to Section 6.1(a) or 6.1(b), have assets with a value in excess of 2.5% of the Total Assets or revenues representing in excess of 2.5% of total revenues of the Borrower LGEC and the Subsidiaries on a consolidated basis as of such date, and (b) taken together with all such Subsidiaries as of such date, did not have assets with a value in excess of 5.0% of Total Assets or revenues representing in excess of 5.0% of total revenues of the Borrower LGEC and the Subsidiaries on a consolidated basis as of such date.

“ Impacted Interest Period ” shall have the meaning given to such term in the definition of “Eurodollar Base Rate”.

“ Incremental Amendment ” shall have the meaning given to such term in Section 2.13(a).

“ Incremental Cap ” shall have the meaning given to such term in Section 2.13(b).

“ Incremental Equivalent Debt ” shall mean secured or unsecured loans or notes issued in lieu of Incremental Facilities; provided that such loans or notes, if secured (i) are secured only by the Collateral and on a pari passu or junior basis with the liens securing the Obligations and (ii) are subject to a customary Intercreditor Agreement reasonably satisfactory to the Administrative Agent and provided , further that any such Incremental Equivalent Debt (x) otherwise satisfies clauses (A)(i), (B), (E), (F), (H) (solely with respect to such additional secured Indebtedness in the form of term loans that are secured on a pari passu basis with the Obligations), (I), (J) and (K) of Section 2.13(a) as if such Incremental Equivalent Debt were an Incremental Facility and (y) together with any Incremental Facility, does not exceed the Incremental Cap.

“ Incremental Facility ” shall mean, without duplication, (a) any Incremental Term Facility, (b) any Incremental Revolving Credit Facility, (c) the commitments (if any) of Additional Revolving Lenders to make Incremental Revolving Loans in respect of any Revolving Credit Commitment Increase and the Incremental Revolving Loans in respect thereof and/or (d) the commitments (if any) of Additional Term Lenders to make Incremental Term Loans in respect of any Term Commitment Increase and the Incremental Term Loans in respect thereof.

 

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“ Incremental Revolving Credit Facility ” shall have the meaning given to such term in Section 2.13(a).

“ Incremental Revolving Loans ” shall mean any revolving loans made under any Incremental Revolving Credit Facility or in respect of any Revolving Credit Commitment Increase.

“ Incremental Term A Facility ” shall mean the commitments (if any) of Additional Term Lenders to make Incremental Term A Loans in accordance with Section 2.13 and the Incremental Term A Loans in respect thereof.

“ Incremental Term A Loans” shall mean any term A loans ( i.e. , having no more than a 5 year maturity and no less than 2.5% average annual amortization per annum (except during any grace period or initial period)) made pursuant to Section 2.13.

“ Incremental Term B Facility ” shall mean the commitments (if any) of Additional Term Lenders to make Incremental Term B Loans in accordance with Section 2.13 and the Incremental Term B Loans in respect thereof.

“ Incremental Term B Loans ” shall mean any term B loans made pursuant to Section 2.13.

“ Incremental Term Facility ” shall mean the commitments (if any) of Additional Term Lenders to make Incremental Term Loans in accordance with Section 2.13 and the Incremental Term Loans in respect thereof.

“ Incremental Term Loans ” means any term loans made pursuant to Section 2.13.

“ Incur ” shall mean issue, create, assume, Guarantee, incur or otherwise become liable for; provided , however , that any Indebtedness or Capital Stock of a Person existing at the time such Person becomes a Restricted Subsidiary (whether by merger, amalgamation, consolidation, acquisition or otherwise) will be deemed to be Incurred by such Restricted Subsidiary at the time it becomes a Restricted Subsidiary; and the terms “Incurred ”, “Incurring ” and “Incurrence” have meanings correlative to the foregoing.

“ Indebtedness ” shall mean, with respect to any Person on any date of determination (without duplication):

(1) the principal of and premium (if any) in respect of indebtedness of such Person for borrowed money;

(2) the principal of and premium (if any) in respect of obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;

(3) the principal component of all obligations of such Person in respect of letters of credit, bankers’ acceptances or other similar instruments (including reimbursement obligations with respect thereto except to the extent such reimbursement obligation relates to a trade payable and such obligation is satisfied within 90 days of Incurrence);

(4) the principal component of all obligations of such Person to pay the deferred and unpaid purchase price of property, which purchase price is due more than six months after the date of placing such property in service or taking delivery and title thereto, except (a) 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 and (b) any earn-out obligation until the amount of such obligation becomes a liability on the balance sheet of such Person in accordance with GAAP;

 

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(5) Capitalized Lease Obligations of such Person (whether or not such items would appear on the balance sheet of the guarantor or obligor);

(6) the principal component or liquidation preference of all obligations of such Person with respect to the redemption, repayment or other repurchase of any Disqualified Stock or, with respect to any Subsidiary of the Borrower LGEC that is not a Guarantor, any Preferred Stock;

(7) the principal component of all Indebtedness of other Persons secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; provided , however , that the amount of such Indebtedness will be the lesser of (a) the Fair Market Value of such asset at such date of determination and (b) the amount of such Indebtedness of such other Persons;

(8) the principal component of Indebtedness of other Persons to the extent Guaranteed by such Person (whether or not such items would appear on the balance sheet of the guarantor or obligor);

(9) to the extent not otherwise included in this definition, net obligations of such Person under Hedging Obligations (the amount of any such obligations to be equal at any time to the termination value of such agreement or arrangement giving rise to such Hedging Obligation that would be payable by such Person at such time); and

(10) to the extent not otherwise included in this definition, the amount of obligations outstanding under the legal documents entered into as part of a securitization transaction or series of securitization transactions that would be characterized as principal if such transaction were structured as a secured lending transaction rather than as a purchase outstanding relating to a securitization transaction or series of securitization transactions.

Notwithstanding anything in this Credit Agreement to the contrary, Indebtedness shall not include, and shall be calculated without giving effect to, the effects of Financial Accounting Standards Board Accounting Standards Codification 825 and related interpretations to the extent such effects would otherwise increase or decrease an amount of Indebtedness for any purpose under this Credit Agreement as a result of accounting for any embedded derivatives created by the terms of such Indebtedness and any such amounts that would have constituted Indebtedness under this Credit Agreement but for the application of this sentence shall not be deemed an incurrence of Indebtedness under this Credit Agreement.

“ Indemnified Party ” shall have the meaning given to such term in Section 10.4.

“ Initial LUX/UK Guarantors ” shall mean the Subsidiaries listed on Schedule 1.3.

“ Initial Unrestricted Subsidiaries ” shall mean each Subsidiary of the Borrower LGEC set forth in Schedule 4.7(b) to this Credit Agreement.

“ Intercreditor Agreement ” shall mean such intercreditor or subordination agreements reasonably acceptable to the Administrative Agent to be entered into from time to time with respect to Other Permitted Priority Indebtedness, Incremental Equivalent Debt, Permitted Slate Financing, Permitted Slate Transaction, Refinancing Notes, Refinancing Term Loans, Replacement Revolving Facilities, and Indebtedness secured by Liens permitted by clauses (1), (16), (17), (18), (20), (24), (33), (38) or (39) of the definition of “Permitted Liens”, or other secured Indebtedness permitted hereunder.

 

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“ Interest Coverage Ratio ” shall mean, as of any date of determination, the ratio of:

(1) Adjusted EBITDA of the Borrower LGEC , calculated on a Pro Forma Basis, for the most recently ended Test Period; to

(2) Consolidated Applicable Interest Charge of the Borrower LGEC , calculated on a Pro Forma Basis, for such Test Period.

“ Interest Deficit ” shall have the meaning given to such term in Section 3.8.

“ Interest Payment Date ” shall mean (a) as to any Base Rate Loan, the last day of each March, June, September and December to occur while such Loan is outstanding and the final maturity date of such Loan, (b) as to any Eurodollar Loan having an Interest Period of three months or less, the last day of such Interest Period, (c) as to any Eurodollar Loan having an Interest Period longer than three months, each day that is three months, or a whole multiple thereof, after the first day of such Interest Period and the last day of such Interest Period, and (d) as to any Loan (other than any Revolving Loan that is a Base Rate Loan), the date of any repayment or prepayment made in respect thereof.

“ Interest Period ” shall mean, as to any Eurodollar Loan, (a) initially, the period commencing on the borrowing or conversion date, as the case may be, with respect to such Eurodollar Loan and ending one, two, three or six (or, if agreed to by all Lenders under the relevant Facility twelve) months thereafter, as selected by the Borrower in its notice of borrowing or notice of conversion, as the case may be, given with respect thereto; and (b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such Eurodollar Loan and ending one, two, three or six (or, if agreed to by all Lenders under the relevant Facility twelve) months thereafter, as selected by the Borrower by irrevocable notice to the Administrative Agent not later than 11:00 A.M., New York City time, on the date that is three Business Days prior to the last day of the then current Interest Period with respect thereto; provided that , all of the foregoing provisions relating to Interest Periods are subject to the following:

(i) if any Interest Period would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless the result of such extension would be to carry such Interest Period into another calendar month in which event such Interest Period shall end on the immediately preceding Business Day;

(ii) the Borrower may not select an Interest Period under a particular Facility that would extend beyond the applicable Maturity Date of such Facility; and

(iii) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar month.

“ Interest Rate Agreement ” shall mean with respect to any Person any interest rate protection agreement, interest rate future agreement, interest rate option agreement, interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedge agreement or other similar agreement or arrangement as to which such Person is party or a beneficiary.

 

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“ Interpolated Rate ” shall mean, at any time, the rate per annum (rounded to the same number of decimal places as the Screen Rate) determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the Screen Rate (for the longest period for which that Screen Rate is available in Dollars) that is shorter than the Impacted Interest Period and (b) the Screen Rate (for the shortest period for which that Screen Rate is available for Dollars) that exceeds the Impacted Interest Period, in each case, as of the Specified Time on the Quotation Day for such Interest Period. When determining the rate for a period which is less than the shortest period for which the Screen Rate is available, the Screen Rate for purposes of clause (a) above shall be deemed to be the overnight rate for Dollars determined by the Administrative Agent from such service as the Administrative Agent may select.

“ Intra Group Liabilities ” shall have the meaning given to such term in Section 9.10.

“ Investment ” shall mean, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of any direct or indirect advance, loan (other than advances or extensions of credit to customers in the ordinary course of business) or other extensions of credit (including by way of Guarantee or similar arrangement, but excluding any debt or extension of credit represented by a bank deposit other than a time deposit or indemnity provision) or capital contribution to (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), or any purchase or acquisition of Capital Stock, Indebtedness or other similar instruments issued by such other Person and all other items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP; provided that none of the following will be deemed to be an Investment:

(1) Hedging Obligations entered into in compliance with this Credit Agreement;

(2) endorsements of negotiable instruments and documents in the ordinary course of business;

(3) an acquisition of assets, Capital Stock or other securities by the Borrower LGEC or a Subsidiary for consideration to the extent such consideration consists of Common Stock of the Borrower LGEC ;

(4) accounts receivable, trade credit and advances to customers in the ordinary course of business;

(5) commission, travel and similar advances to officers, employees and consultants made in the ordinary course of business; and

(6) any assets or securities received in satisfaction or partial satisfaction thereof from financially troubled account debtors to the extent reasonably necessary in order to prevent or limit loss and any prepayments and other credits to suppliers made in the ordinary course of business.

For purposes of Section 7.2 of this Credit Agreement,

(a) “Investment” will include the portion (proportionate to the Borrower LGEC ’s equity interest in a Restricted Subsidiary to be designated as an Unrestricted Subsidiary) of the Fair Market Value of the net assets of such Restricted Subsidiary at the time that such Restricted Subsidiary is designated an Unrestricted Subsidiary; provided , however , that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Borrower LGEC will be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary in an amount (if positive) equal to (i)  the Borrower LGEC ’s aggregate “Investment” in such Subsidiary as of the time of such redesignation less (ii) the portion (proportionate to the Borrower LGEC ’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the time that such Subsidiary is so re-designated a Restricted Subsidiary;

 

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(b) any property transferred to or from an Unrestricted Subsidiary will be valued at its Fair Market Value at the time of such transfer; and

(c) if the Borrower LGEC or any Restricted Subsidiary sells or otherwise disposes of any Voting Stock of any Restricted Subsidiary such that, after giving effect to any such sale or disposition, such entity is no longer a Subsidiary of the Borrower, the Borrower LGEC, LGEC shall be deemed to have made an Investment on the date of any such sale or disposition equal to the Fair Market Value of the Capital Stock of such Subsidiary not sold or disposed of.

“ ISP ” means, with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).

“ Issuing Bank ” shall mean each of (i)(a) JPMorgan Chase Bank, N.A., with respect to up to $100,000,000 of Letters of Credit, (b) Bank of America, N.A., with respect to up to $ 50,000,000 16,000,000 of Letters of Credit, (c) The Bank of Tokyo-Mitsubishi UFJ, Ltd. with respect to up to $16,000,000 of Letters of Credit, (d) Royal Bank of Canada with respect to up to $16,000,000 of Letters of Credit, (e) SunTrust Bank with respect to up to $16,000,000 of Letters of Credit, (f) Wells Fargo Bank, N.A. with respect to up to $16,000,000 of Letters of Credit, (g) BNP Paribas with respect to up to $10,000,000 of Letters of Credit and ( c) Deutsche Bank AG New York Branch, h) Societe Generale with respect to up to $ 50,000,000 10,000,000 of Letters of Credit, in each case, acting through any of its affiliates or branches, and (ii) any other Issuing Bank designated pursuant to Section 2.3(j) in each case in its capacity as an Issuing Bank, and its successors in such capacity as provided in Section 2.3(i) ; provided that in no event shall Royal Bank of Canada (or any of its respective affiliates or branches) be required to issue trade and commercial letters of credit . An Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by affiliates of such Issuing Bank, in which case the term Issuing Bank shall include any such affiliates with respect to Letters of Credit issued by such Affiliate. Each reference herein to “the Issuing Bank” shall be deemed to be a reference to the relevant Issuing Bank.

“ Joinder Agreement ” shall mean the “Instrument of Assumption and Joinder”, substantially in the form attached hereto as Exhibit G .

“ Joint Venture ” shall mean a joint venture or similar venture with one or more unrelated parties (whether structured as a corporation, partnership, limited liability company or other entity) in which the Borrower LGEC or any of its Restricted Subsidiaries own Capital Stock and which is formed and operated to conduct a Related Business.

“ Judgment Conversion Date ” shall have the meaning given to such term in Section 11.10.

“ L/C Backstop ” shall mean, in respect of any Letter of Credit, (a) a letter of credit delivered to the Issuing Bank which may be drawn by the Issuing Bank to satisfy any obligations of the Borrower in respect of such Letter of Credit or (b) cash or Cash Equivalents deposited with the Issuing Bank to satisfy any obligation of the Borrower in respect of such Letter of Credit, in each case, in an amount not to exceed 102.00% of the undrawn face amount and any unpaid Reimbursement Obligations with respect to such Letter of Credit and on terms and pursuant to arrangements (including, if applicable, any appropriate reimbursement agreement) reasonably satisfactory to the respective Issuing Bank.

 

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“ L/C Disbursement ” shall mean a payment or disbursement made by an Issuing Bank pursuant to a Letter of Credit.

“ L/C Exposure ” shall mean, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (b) the aggregate amount of all L/C Disbursements that have not yet been reimbursed by or on behalf of the Borrower at such time. The L/C Exposure of any Lender at any time shall be its Revolver Percentage of the total L/C Exposure at such time. For all purposes of this Credit Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Rule 3.13 or 3.14 of the ISP or Article 36 of the UCP, such Letter of Credit shall be deemed to be “outstanding” in the amount so remaining available to be drawn. Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided that with respect to any Letter of Credit that, by its terms or the terms of any document related thereto, provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.

“ L/C Obligations ” shall mean the aggregate undrawn face amounts of all outstanding Letters of Credit and all unpaid Reimbursement Obligations.

“ L/C Sublimit ” shall mean $200,000,000, as reduced pursuant to the terms hereof.

“ Lender ” and “ Lenders ” shall mean the several banks and other financial institutions and other lenders from time to time party to this Credit Agreement ( including by providing a Lender Addendum to Amendment No. 2, but excluding Disqualified Lenders), including each assignee Lender pursuant to Section 11.3.

“ Lending Office ” shall mean, with respect to any of the Lenders, the branch or branches (or affiliate or affiliates) from which such Lender’s Loans are made or maintained and for the account of which all payments of principal of, and interest on, such Lender’s Loans are made, as notified to the Administrative Agent from time to time.

“ Letter of Credit ” shall have the meaning given to such term in Section 2.3(a).

“ Letter of Credit Commitment ” shall have the meaning given to such term in Section 2.3(a).

“LGEC” shall have the meaning given to such term in the introductory paragraph of this Credit Agreement.

“ LGEI ” shall mean Lions Gate Entertainment Inc., a Delaware corporation, and its successors.

“ LGF ” shall mean Lions Gate Films Inc. and its successors.

“ LGT ” shall mean Lions Gate Television Inc. and its successors.

“ Lien ” shall mean, with respect to any asset, any mortgage, lien (statutory or otherwise), pledge, hypothecation, charge, security interest, preference, priority 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 other agreement to give a security interest in and any filing of or agreement to give any financing statement under the applicable PPSA, the CCQ, or UCC (or equivalent statutes) of any jurisdiction; provided that in no event shall an operating lease be deemed to constitute a Lien.

 

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“ Loan ” or “ Loans ” shall mean any Revolving Loan, Term Loan, any loan issued under any Incremental Facility, any Extended Revolving Loan or Extended Term Loan, any loan issued pursuant to the final paragraph of Section 11.12(a) hereof or any Refinancing Term Loans or Loans under any Replacement Revolving Facility.

“ Luxembourg Guarantor ” shall have the meaning assigned to such term in Section 9.10.

“ Majority Facility Lenders ” shall mean, with respect to any Term Facility, the holders of more than 50% of the aggregate unpaid principal amount of the Term Loans under such Term Facility, and with respect to the Revolving Facility, the holders of Revolving Exposures and Unused Revolving Credit Commitments representing more than 50% of the sum of the total Revolving Exposures and Unused Revolving Credit Commitments at such time.

“ Material Adverse Effect ” shall mean any change or effect that has a materially adverse effect on (a) the business, assets, properties, operations or financial condition of the Borrower LGEC and its Restricted Subsidiaries, taken as a whole, (b) the legal right, power or authority of any material Credit Party to perform its respective payment obligations under the Fundamental Documents to which it is a party or (c) the validity or enforceability of, or the rights, remedies or benefits available to the Lenders under, the Fundamental Documents, taken as a whole.

“ Material Indebtedness ” shall mean Consolidated Debt of the Borrower and the Guarantors in an aggregate principal amount equal to or greater than $75,000,000.

“ Material Specified Guarantor ” shall include each Guarantor representing at least 5% of the Total Assets or consolidated revenue of the Borrower and the Guarantors in the aggregate, provided that if the aggregate of all such Material Specified Guarantors does not represent at least 90% of the consolidated total assets and consolidated revenue of the Borrower and the Guarantors, one or more Guarantors shall be deemed to be a “Material Specified Guarantor” such that the requirement set forth above is satisfied on the Closing Date.

“ Maturity Date ” shall mean the Final Maturity Date or the Final Revolving Credit Termination Date, as applicable.

“ Merger Agreement ” shall have the meaning set forth in the preliminary statements hereto. mean that certain Agreement and Plan of Merger, dated as of June 30, 2016 (as amended, supplemented or modified and in effect from time to time, and including all schedules and exhibits thereto , the “Merger Agreement”), by and among LGEC, Merger Sub, and the Target.

“ Merger Sub ” shall have the meaning set forth in the preliminary statements hereto mean Orion Arm Acquisition Inc., a Delaware corporation .

“ Minimum Extension Condition ” shall have the meaning given to such term in Section 2.14(b).

“ Moody’s ” shall mean Moody’s Investors Service, Inc., and any successor-in-interest thereto.

 

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“ MQP ” shall mean MQP, LLC and its successors.

“ Multiemployer Plan ” shall mean a plan described in Section 4001(a)(3) of ERISA to which any Credit Party or ERISA Affiliate is making or accruing an obligation to make contributions, or has within any of the seven preceding plan years made or accrued an obligation to make contributions.

“ Negative Pick-up Obligation ” shall mean, with respect to any item of Product produced by anyone other than the Borrower LGEC or a Restricted Subsidiary, a commitment to pay a certain sum of money or other Investment made by the Borrower LGEC or Restricted Subsidiary in order to obtain ownership, distribution rights or sales agency rights in such item of Product. Negative Pick-up Obligation includes both “traditional” negative pickup arrangements and indirect structures.

“ Net Available Cash ” from an Asset Sale shall mean cash payments actually received (including any cash payments received by way of deferred payment of principal pursuant to a note or installment receivable, but only as and when actually received, but excluding any other consideration received in the form of assumption by the acquiring Person of Indebtedness or other obligations relating to the properties or assets that are the subject of such Asset Sale or received in any other non-cash form) therefrom, in each case net of:

(1) all legal, accounting, investment banking, title and recording taxes, fees, expenses, commissions and other fees and expenses Incurred, and all Federal, state, provincial, foreign and local taxes required to be paid or accrued as a liability under GAAP or otherwise payable (in the good faith determination of the Borrower LGEC ) in connection with such Asset Sale (including any repatriation of the proceeds of such Asset Sale);

(2) all payments made on any Indebtedness that is secured by any assets subject to such Asset Sale, in accordance with the terms of such Indebtedness, or which must by its terms, or in order to obtain a necessary consent to such Asset Sale, or by Applicable Law be repaid out of the proceeds from such Asset Sale;

(3) all distributions and other payments required to be made to minority interest holders in Subsidiaries or Joint Ventures as a result of such Asset Sale;

(4) the deduction of appropriate amounts to be provided by the seller as a reserve, in accordance with GAAP, against any liabilities associated with the assets disposed of in such Asset Sale and retained by the Borrower LGEC or any Restricted Subsidiary after such Asset Sale; and

(5) in the case of any Asset Sale by a Subsidiary which is not a Wholly-Owned Subsidiary, a portion of the cash payments received by such Subsidiary equal to the portion of the economic interests in such Subsidiary which are not directly or indirectly owned by the Borrower LGEC .

“ Net Cash Proceeds ,” with respect to any issuance or sale of Capital Stock or any Incurrence of Indebtedness, shall mean the cash proceeds of such issuance or sale or such Incurrence net of attorneys’ fees, accountants’ fees, underwriters’ or placement agents’ fees, listing fees, discounts or commissions and brokerage, consultant and other fees, expenses and charges actually Incurred in connection with such issuance or sale or such Incurrence and net of taxes paid or payable (in the good faith determination of the Borrower LGEC ) in connection with such issuance or sale or such Incurrence (including any repatriation of the proceeds of such sale or Incurrence).

 

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“ Net First Lien Leverage Ratio ” shall mean, as of any date of determination, the ratio of:

(1) (A) the total principal amount of Secured Funded Indebtedness that would appear on a balance sheet of the Borrower LGEC and its Restricted Subsidiaries as of such determination date, minus (B) Unrestricted Cash as of such determination date in an amount not to exceed $200,000,000, to

(2) Adjusted EBITDA of the Borrower LGEC , calculated on a Pro Forma Basis, for the most recent Test Period.

“ Net Total Leverage Ratio ” shall mean, as of any date of determination, the ratio of:

(1) (A) the total principal amount of Consolidated Debt that would appear on a balance sheet of the Borrower LGEC and its Restricted Subsidiaries as of such determination date, minus (B) Unrestricted Cash as of such determination date in an amount not to exceed $200,000,000, to

(2) Adjusted EBITDA of the Borrower LGEC , calculated on a Pro Forma Basis, for the most recent Test Period.

“ New Borrower” shall have the meaning given to such term in the introductory paragraph of this Credit Agreement.

“ Non-Guarantor Subsidiary ” shall mean any Restricted Subsidiary (other than the New Borrower) that is not a Guarantor.

“ Non-S-X Adjustment Amount ” shall have the meaning given to such term in the definition of “Pro Forma Basis”.

“ Non-U.S. Plan ” shall mean any plan, fund (including, without limitation, any superannuation fund) or other similar program established, contributed to (regardless of whether through direct contributions or through employee withholding) or maintained outside the United States by a Credit Party or one or more Subsidiaries of a Credit Party primarily for the benefit of employees of the Credit Party or such Subsidiaries residing outside the United States, which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and which plan is not subject to ERISA or the Code; provided , however , that “Non-U.S. Plan” shall not include any such plan, fund or program sponsored or maintained by a Governmental Authority.

“ Note ” or “ Notes ” shall have the meaning given to such term in Section 2.11(d).

“ NYFRB ” shall mean the Federal Reserve Bank of New York.

“ NYFRB Rate ” shall mean, for any day, the greater of (a) the Federal Funds Rate in effect on such day and (b) the Overnight Bank Funding Rate in effect on such day (or for any day that is not a Business Day, for the immediately preceding Business Day); provided that if none of such rates are published for any day that is a Business Day, the term “NYFRB Rate” means the rate for a federal funds transaction quoted at 11:00 a.m. on such day received by the Administrative Agent from a Federal funds broker of recognized standing selected by it; provided , further, that if any of the aforesaid rates shall be less than zero, such rate shall be deemed to be zero for purposes of this Credit Agreement

 

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“ Obligations ” shall mean (a) the obligation of the Borrower to make due and punctual payment of principal and interest on the Loans, the face amount of the Commitment Fees, any reimbursement obligations in respect of Letters of Credit, costs and attorneys’ fees and all other monetary obligations of the Borrower and the Guarantors to the Administrative Agent, the Issuing Banks or any Lender under this Credit Agreement, the Notes, any other Fundamental Document or the Fee Letters (including interest accruing after the maturity of the Loans and reimbursement obligations and interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding relating to any Credit Party, whether or not a claim for post-filing or post-petition interest is allowed in such proceeding) and (b) all amounts payable under any Specified Swap Agreement or any Specified Cash Management Agreement, provided that (i) the Obligations of the Credit Parties under any Specified Swap Agreement and Specified Cash Management Agreements shall be secured and guaranteed pursuant to the Collateral Documents only to the extent that, and for so long as, the other Obligations are so secured and guaranteed and (ii) any release of Collateral or Guarantors effected in the manner permitted by this Credit Agreement or any Collateral Document shall not require the consent of any counterparty under such agreement pursuant to any Fundamental Document; and, provided , further , that notwithstanding anything to the contrary, for all purposes of the Fundamental Documents, the Obligations of any Guarantor shall exclude any Excluded Swap Obligation of such Guarantor.

“ OFAC ” shall have the meaning given to such term in Section 4.22.

“ Officer ” shall mean the Chairman of the Board, the Chief Executive Officer, the President, the Chief Financial Officer, Chief Strategic Officer, any President, any Executive Vice President, Senior Vice President or Vice President, the Treasurer or the Secretary of the Borrower. Officer of any Guarantor has a correlative meaning.

“ Officers’ Certificate ” shall mean a certificate signed by two Officers or by an Officer and either an Assistant Treasurer or an Assistant Secretary of the Borrower or LGEC .

“Original Closing Date” shall mean December 8, 2016

“ Other Applicable Indebtedness ” shall have the meaning given to such term in Section 2.8(c)(ii).

“ Other Permitted Priority Indebtedness ” shall mean any Indebtedness which is (a) permitted to be Incurred after the Closing Restatement Date by Section 7.1(c)(xii), Section 7.1(c)(xiii), 7.1(c)(xiv), 7.1(c)(xvii) or 7.1(c)(xviii) hereof or (b) incurred prior to the Closing date Restatement Date but of any type described in the foregoing clause (a).

“ Overnight Bank Funding Rate ” shall mean, for any day, the rate comprised of both overnight federal funds and overnight Eurodollar borrowings by U.S.-managed banking offices of depository institutions (as such composite rate shall be determined by the NYFRB as set forth on its public website from time to time) and published on the next succeeding Business Day by the NYFRB as an overnight bank funding rate (from and after such date as the NYFRB shall commence to publish such composite rate).

“ Participant ” shall have the meaning given to such term in Section 11.3(d)

“ Participant Register ” shall have the meaning given to such term in Section 11.3(d).

“ Participating Interest ” shall have the meaning given to such term in Section 2.3(d).

“ Participating Lender ” shall have the meaning given to such term in Section 2.3(d).

 

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“ payment default ” shall have the meaning given to such term in Section 8.1(e).

“ Patent Security Agreement ” shall have the meaning given to such term in the Pledge and Security Agreement.

“ Patent Security Agreement Supplement ” shall have the meaning given to such term in the Pledge and Security Agreement.

“ PBGC ” shall mean the Pension Benefit Guaranty Corporation and its successors.

“ Pension Plan ” means a Plan described in Section 3(2) of ERISA.

“ Percentage ” shall mean for any Lender its Revolver Percentage or Term Loan Percentage, as applicable; and where the term “Percentage” is applied on an aggregate basis, such aggregate percentage shall be calculated by aggregating the separate components of the Revolver Percentage and Term Loan Percentage, and expressing such components on a single percentage basis.

“ Permitted Holder ” shall mean, at any time, each of:

(a)(i) Mark H. Rachesky, M.D., (ii) John C. Malone and (iii) any Affiliate of such Persons, or any Affiliated Persons of such Persons;

(b) 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 Person described in clause (a) hereof is a member, provided that Persons described in clause (a) hereof beneficially own a majority of the Voting Stock of the Borrower LGEC beneficially owned by all members of such group; and

(c) any Person (including the Borrower LGEC upon a sale of all or substantially all of its assets to a Subsidiary thereof in a transaction permitted under Section 7.6) (x) that acquires (or otherwise holds), directly or indirectly, 100% of the voting power of the Voting Stock of the Borrower (or the Successor Borrower) LGEC and, immediately after giving effect to such acquisition and any related transactions, has no material assets other than Capital Stock of the Borrower LGEC and (y) of which no other Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor provision) other than any of the Permitted Holders specified in clauses (a) and (b) above, holds more than 50% of the total voting power of the Voting Stock thereof (any Person described in clause (c) hereof, a “ Permitted Parent Holdco ”).

“ Permitted Investment ” shall mean an Investment by the Borrower LGEC or any Restricted Subsidiary in:

(1) the Borrower LGEC or a Restricted Subsidiary;

(2) a Person that is engaged in a Related 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, amalgamated, or consolidated with or into, or transfers or conveys all or substantially all of its assets to, or is liquidated into the Borrower LGEC or a Restricted Subsidiary,

 

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and, in each case, any Investment held by such Person; provided that such Investment was not acquired by such Person in contemplation of such acquisition, merger, amalgamation, consolidation or transfer;

(3) cash and Cash Equivalents;

(4) receivables owing to the Borrower LGEC or any Restricted Subsidiary created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided , however , that such trade terms may include such concessionary trade terms as the Borrower LGEC or any such Restricted Subsidiary deems reasonable under the circumstances;

(5) payroll, travel, services (e.g., shared services arrangements) to the extent permitted by Section 7.5(b)(vii) and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business;

(6) loans or advances to employees, officers or directors of the Borrower LGEC or any Restricted Subsidiary not in excess of $10,000,000 at any time outstanding;

(7) any Investment acquired by the Borrower LGEC or any of its Restricted Subsidiaries:

(a) in exchange for any other Investment or accounts receivable held by the Borrower LGEC or any such Restricted Subsidiary in connection with or as a result of a bankruptcy, insolvency, workout, reorganization or recapitalization of the issuer of such other Investment or accounts receivable; or

(b) as a result of a foreclosure (or similar remedy) by the Borrower LGEC or any of its Restricted Subsidiaries with respect to any secured Investment or other transfer of title with respect to any secured Investment in default;

(8) Investments made as a result of the receipt of non-cash consideration from an Asset Sale that was made pursuant to and in compliance with Section 7.8 or any other disposition of assets not constituting an Asset Sale;

(9) Investments in existence on the Closing Restatement Date (including, for the avoidance of doubt, Investments of Target and its Subsidiaries) and all exchanges, extensions, refinancings and renewals thereof;

(10) Currency Agreements, Interest Rate Agreements and related Hedging Obligations, which transactions or obligations are Incurred in compliance with Section 7.1;

(11) Guarantees and other Investments issued in accordance with Section 7.1 relating to Negative Pick-up Obligations, Program Acquisition Guarantees, minimum guarantees to acquire items of Product or interests therein, or similar activities, in each case in the ordinary course of business;

(12) Investments made in connection with the funding of contributions under any non-qualified retirement plan or similar employee compensation plan in an amount not to exceed the amount of compensation expense recognized by the Borrower LGEC and its Restricted Subsidiaries in connection with such plans;

 

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(13) Investments made pursuant to investment commitments existing on the Closing Restatement Date set forth on Schedule 1.4 in (i) Playco Holdings Limited and (ii) other Joint Ventures in existence on the Closing Restatement Date;

(14) with respect to the purchase price and/or construction costs expended by the Borrower and Guarantors for Borrower LGEC ’s headquarters or any other real property of the Borrower and Guarantors, the portion of such purchase prices in excess of any mortgage related to such purchase price;

(15) Investments in the Headquarters JV, at any time outstanding, not to exceed $40,000,000 (exclusive of any permitted guarantee);

(16) Investments in Joint Ventures and Unrestricted Subsidiaries, in an amount, at any time outstanding, not to exceed the greater of $200,000,000 and 2.25% of Total Assets when made;

(17) Investments (including debt obligations) received in connection with the bankruptcy, insolvency or reorganization of suppliers, customers or other debtors or in settlement of delinquent obligations arising in the ordinary course of business;

(18) nominal Investments in Special Purpose Producers;

(19) Investments in and Guarantees of obligations of the Borrower LGEC , any Restricted Subsidiary, or any of their respective direct or indirect Subsidiaries or Joint Ventures (which Subsidiaries or Joint Ventures may engage in business unrelated to such Investment to the extent otherwise permissible under this Credit Agreement) in connection with co-productions, co-ventures or co-financing arrangements related to the production, distribution and/or acquisition of Product or an interest therein, in each case in the ordinary course of business consistent with past practice;

(20) Investments in an aggregate amount at any time outstanding not to exceed the greater of (a) $275,000,000 and (b) 3.0% of Total Assets when made; provided that at the time of and after giving effect to such Investment, no Default shall have occurred and be continuing or would occur as a consequence thereof;

(21) the Transactions , including the consummation of the Acquisition pursuant to the terms of the Merger Agreement ;

(22) any acquisition or production of Product in the ordinary course of business, to the extent such action would be considered an Investment;

(23) Letters of credit as to which the Borrower LGEC or a Restricted Subsidiary is the beneficiary and which are issued for the account of third party investors in Product of the Borrower LGEC or a Restricted Subsidiary;

(24) Investments consisting of the contribution or transfer of the (A) Comic Con business or (B) Spanish-language OTT to an Unrestricted Subsidiary or Joint Venture (or the transfer of Capital Stock in a Subsidiary that owns the Comic Con business or Spanish-language OTT, as the case may be, such that such Subsidiary becomes a Joint Venture), provided that at the time of and after giving effect to such Investment, (x) no Default shall have occurred and be continuing or would occur as a consequence thereof and (y)  the Borrower LGEC shall be in compliance with the financial ratios set forth in Section 7.9(a) and (b) for the relevant fiscal quarter on a Pro Forma Basis;

 

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(25) Investments in any ProdCo in accordance with the definition of “Permitted Slate Transaction”; and

(26) Guarantees made in accordance with Section 7.1 or Section 6.13.

“ Permitted Liens ” shall mean, with respect to any Person:

(1) Liens, which Liens may be pari passu with or junior to the Liens securing the Obligations pursuant to the Collateral Documents, securing (i) the Obligations, including without limitation the Loans and the Guarantees under Article 9 and any obligations owing to the Administrative Agent, Issuing Banks or Lenders under this Credit Agreement and the Collateral Documents (including Liens securing any Indebtedness pursuant to Section 2.13, Section 2.14, and Section 2.15), (ii) any Incremental Equivalent Debt or (iii) any Refinancing Notes;

(2) pledges or deposits by such Person under workers’ compensation laws, unemployment insurance laws or similar legislation, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or deposits to secure public or statutory obligations of such Person or deposits of cash or United States government bonds to secure surety or appeal bonds to which such Person is a party, or deposits as security for contested taxes or import or customs duties or for the payment of rent, in each case Incurred in the ordinary course of business;

(3) Liens imposed by law, including carriers’, warehousemen’s, mechanics’, materialmen’s and repairmen’s Liens;

(4) Liens for taxes, assessments or other governmental charges not yet subject to penalties for non-payment or that are being contested in good faith by appropriate proceedings, provided that any appropriate reserves required pursuant to GAAP have been made in respect thereof;

(5) Liens in favor of issuers of surety or performance bonds or letters of credit or bankers’ acceptances or similar obligations issued pursuant to the request of and for the account of such Person in the ordinary course of its business;

(6) 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 or agreements (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 the business of such Person or to the ownership of its properties that do not in the aggregate materially impair their use in the operation of the business of such Person;

(7) Liens securing Hedging Obligations so long as the related Indebtedness is permitted under this Credit Agreement;

(8) leases, licenses, subleases and sublicenses of assets (including, without limitation, real property and intellectual property rights) that do not materially interfere with the ordinary conduct of the business of the Borrower LGEC or any of the Restricted Subsidiaries;

 

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