Exhibit 10.1

Execution Version

SECOND AMENDMENT

SECOND AMENDMENT , dated as of May 14, 2019 (this “ Amendment ”), to the Credit Agreement, dated as of May 22, 2015 (as amended by Amendment No. 1, dated as of December 22, 2017, the “ Credit Agreement ”), among RESOLUTE FOREST PRODUCTS INC., a Delaware corporation (the “ Company ”), RESOLUTE FP CANADA INC., a Canadian corporation (“ RFP Canada ”), each of the other Borrowers and Guarantors party thereto from time to time, the several banks and other financial institutions or entities from time to time parties to the Credit Agreement, as lenders (the “ Lenders ”), BANK OF AMERICA, N.A., as the Administrative Agent under the U.S. Subfacility (in such capacity, the “ U.S. Administrative Agent ”), a U.S. Issuing Bank and the U.S. Swingline Lender, and BANK OF AMERICA, N.A. (acting through its Canada Branch), as the Administrative Agent under the Canadian Subfacility (in such capacity, the “ Canadian Administrative Agent ” and together with the U.S. Administrative Agent, the “ Administrative Agent ”), the Canadian Issuing Bank and the Canadian Swingline Lender.

R E C I T A L S

WHEREAS, Section 13.12 of the Credit Agreement permits certain amendments to the Credit Agreement with the consent of each of the Lenders affected thereby, the Issuing Banks, the Administrative Agent and the Credit Parties;

WHEREAS, the Credit Parties, the Administrative Agent, all of the Lenders and all of the Issuing Banks wish to amend the Credit Agreement on the terms and subject to the conditions set forth herein; and

WHEREAS, BofA Securities, Inc., BMO Capital Markets Corp. and Wells Fargo Bank, N.A. are the joint lead arrangers and joint bookrunners for this Amendment (the “ Joint Lead Arrangers ”), BMO Capital Markets Corp. and Wells Fargo Bank, N.A. are the co-syndication agents for this Amendment and TD Bank, N.A. and Canadian Imperial Bank of Commerce are the co-documentation agents for this Amendment.

NOW, THEREFORE, in consideration of the premises 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. Capitalized Terms . Capitalized terms used in this Amendment but not defined herein shall have the meanings assigned to them in the Credit Agreement.

Section 2. Amendment .

(a) The Credit Agreement is, hereby amended, as of the Second Amendment Effective Date (as defined below), to delete the stricken text (indicated textually in the same manner as the following example: stricken text ) and to add the double-underlined text (indicated textually in the same manner as the following example: double-underlined text ) as set forth in the pages of the Credit Agreement attached as Exhibit A hereto (the Credit Agreement as amended hereby, the “ Amended Credit Agreement ”).

(b) Schedule 1.01C to the Amended Credit Agreement shall be in the form attached as Exhibit B hereto.

(c) Schedule 2.01 to the Amended Credit Agreement shall be in the form attached as Exhibit C hereto.

(d) Exhibit A-1 to the Amended Credit Agreement shall be in the form attached as Exhibit D hereto.

(e) Exhibit A-2 to the Amended Credit Agreement shall be in the form attached as Exhibit E hereto.

Section 3. Representations and Warranties . Each Credit Party makes the following representations and warranties as of the Second Amendment Effective Date:

(a) each Credit Party has duly executed and delivered this Amendment, and this Amendment constitutes its legal, valid and binding obligation enforceable in accordance with its terms, except to the extent that the enforceability thereof may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws generally affecting creditors’ rights and by equitable principles (regardless of whether enforcement is sought in equity or at law);

(b) neither the execution, delivery or performance by any Credit Party of this Amendment, nor compliance by it with the terms and provisions hereof, (i) will contravene any provision of any applicable law, statute, rule or regulation or any order, writ, injunction or decree of any court or governmental instrumentality, other than any law, statute, rule or regulation the violation of which could not reasonably be expected to result in a Material Adverse Effect, (ii) will conflict with or result in any breach of any of the terms, covenants, conditions or provisions of, or constitute a default under, or result in the creation or imposition of (or the obligation to create or impose) any Lien (except pursuant to the Security Documents) upon any of the property or assets of any Credit Party or any of its respective Restricted Subsidiaries pursuant to the terms of, any material indenture, mortgage, deed of trust, credit agreement or loan agreement, or any other material agreement, contract or instrument, in each case to which any Credit Party or any of its Restricted Subsidiaries is a party or by which it or any of its property or assets is bound or to which it may be subject, the violation of which could reasonably be expected to result in a Material Adverse Effect or (iii) will violate any provision of the certificate or articles of incorporation, certificate of formation, limited liability company agreement or by-laws (or equivalent organizational documents), as applicable, of any Credit Party; and

(c) no order, consent, approval, license, authorization or validation of, or filing, recording or registration with (except for (x) those that have otherwise been obtained or made on or prior to the Second Amendment Effective Date and which remain in full force and effect on the Second Amendment Effective Date, (y) filings which are necessary to perfect the security interests and Liens created under the Security Documents and (z) periodic reports under the Securities and Exchange Act of 1934, as amended), or exemption by, any governmental or public body or authority, or any subdivision thereof, is required to be obtained or made by, or on behalf of, any Credit Party to authorize, or is required to be obtained or made by, or on behalf of, any Credit Party in connection with, the execution, delivery and performance of this Amendment.

 

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Section 4. Conditions to Effectiveness of this Amendment . This Amendment shall become effective on the date hereof (such date, the “ Second Amendment Effective Date ”) upon the satisfaction of the following conditions:

(a) (i) the Credit Parties constituting all Credit Parties as of the Second Amendment Effective Date shall have executed and delivered counterparts of this Amendment to the Administrative Agent, (ii) the Lenders constituting all Lenders as of the Second Amendment Effective Date shall have executed and delivered counterparts of this Amendment to the Administrative Agent, (iii) each Issuing Bank as of the Second Amendment Effective Date shall have executed and delivered counterparts of this Amendment to the Administrative Agent and (iv) each of the U.S. Administrative Agent and the Canadian Administrative Agent shall have executed a counterpart of this Amendment;

(b) (i) the Canadian Credit Parties constituting all Canadian Credit Parties as of the Second Amendment Effective Date shall have executed and delivered counterparts of an amendment to the Canadian Security Agreement to the Administrative Agent, (ii) the U.S. Credit Parties constituting all U.S. Credit Parties as of the Second Amendment Effective Date shall have executed and delivered counterparts of an amendment to the U.S. Security Agreement to the Administrative Agent, (iii) the Collateral Agent shall have executed a counterpart of the amendment to the Canadian Security Agreement, and (iv) the Collateral Agent shall have executed a counterpart of the amendment to the U.S. Security Agreement;

(c) the Company (or its designee) shall have paid, or caused to be paid, all reasonable documented out of pocket costs and expenses of the Administrative Agent in connection with the preparation, negotiation and execution of this Amendment (including the fees and expenses of (i) Cahill Gordon & Reindel LLP as U.S. counsel to the Administrative Agent and (ii) McMillan LLP as Canadian counsel to the Administrative Agent) for which invoices have been presented to the Company at least two business days prior to the Second Amendment Effective Date;

(d) the Company (or its designee) shall have paid, or caused to be paid, all fees owed to Bank of America, N.A. and the Joint Lead Arrangers pursuant to that certain Fee Letter dated May 14, 2019 by and between the Company and Bank of America, N.A.;

(e) the Administrative Agent shall have received from (i) Troutman Sanders LLP, U.S. counsel to the Credit Parties and (ii) McCarthy Tétrault, special Canadian counsel to the Credit Parties, in each case, an opinion addressed to the Administrative Agent, the Collateral Agent and each of the Lenders party to the Amended Credit Agreement on the Second Amendment Effective Date and dated the Second Amendment Effective Date in form and substance reasonably satisfactory to the Administrative Agent;

(f) prior to and immediately after giving effect to this Amendment, no Default or Event of Default shall have occurred and be continuing;

(g) each of the representations and warranties made by any Credit Party set forth in Section 8 of the Credit Agreement or in any other Credit Document are true and correct in all material respects (without duplication of any materiality standard set forth in any such representation or warranty) on and as of the Second Amendment Effective Date with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date, in which case such representations and warranties shall be true and correct in all material respects as of such date (without duplication of any materiality standard set forth in any such representation or warranty);

(h) the Administrative Agent shall have received a certificate, dated the Second Amendment Effective Date and signed on behalf of the Company (and not in any individual capacity) by a Responsible Officer of the Company, certifying on behalf of the Company that the conditions set forth in Sections 4(f) and 4(g) hereof have been satisfied;

 

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(i) the Administrative Agent shall have received a certificate from the Company and each other Credit Party, dated the Second Amendment Effective Date, signed by a Responsible Officer of such Credit Party, and attested to by the secretary or any assistant secretary of such Credit Party, in each case, on behalf of such Credit Party (and not in any individual capacity), certifying (i) that the copies of such Credit Party’s certificate or articles of incorporation and by-laws (or equivalent organizational documents) (x) as previously certified and delivered to the Administrative Agent remain in full force and effect as of the Second Amendment Effective Date without modification or amendment since such original delivery or (y) as certified as of a recent date by the appropriate Governmental Authority of the jurisdiction of such Credit Party’s organization or formation and attached to such officer’s certificate are true, correct, and complete and in full force and effect as of the Second Amendment Effective Date and (ii) that the copies of the Credit Parties’ resolutions approving and adopting this Amendment and the transactions contemplated hereby, and authorizing the execution and delivery hereof, as attached to such officer’s certificate, are true, correct, and complete copies and in full force and effect as of the Second Amendment Effective Date;

(j) the Administrative Agent shall have received good-standing certificates (or similar instrument, if applicable) with respect to each Credit Party certified by proper governmental authorities in such Credit Party’s jurisdiction of organization or formation, and such bring-down telegrams or certificates thereof as the Administrative Agent shall reasonably request;

(k) each Lender shall have received all documentation and other information required by bank regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the USA PATRIOT Act to the extent reasonably requested by such Person in writing at least ten (10) Business Days prior to the Second Amendment Effective Date and (ii) to the extent any Borrower qualifies as a “legal entity customer” under 31 C.F.R. § 1010.230 (the “ Beneficial Ownership Regulation ”), any Lender that has requested, in a written notice to the Company at least ten (10) Business Days prior to the Second Amendment Effective Date, a certification regarding beneficial ownership as required by the Beneficial Ownership Regulation (a “ Beneficial Ownership Certification ”) shall have received such Beneficial Ownership Certification.

(l) the Company shall have delivered to the Administrative Agent a Borrowing Base Certificate for the month ended March 31, 2019.

Section 5. Release of Certain Credit Parties . Each of the Lenders and the Administrative Agent hereby consents to the release of (i) Donohue Malbaie ULC as a Canadian Borrower and a Canadian Subsidiary Guarantor, (ii) each of 3284649 Nova Scotia Company, 9340939 Canada Inc., and Fibrek Canada ULC as a Canadian Subsidiary Guarantor, and (iii) AbiBow Recycling LLC as a U.S. Subsidiary Guarantor (collectively, the “ Released Credit Parties ”). From and after the Second Amendment Effective Date, (x) each of the Released Credit Parties shall be and hereby are released from all obligations under the Credit Agreement, each Guaranty to which it is a party and each of the other Credit Documents (y) all liens and security interests in favor of any of the Agents in the assets of the Released Credit Parties as security for the Obligations shall be released. Each of the Lenders hereby authorizes the Administrative Agent and Collateral Agent to execute, deliver and file (as applicable) such UCC, PPSA, and other documents, instruments, and agreements as may be necessary or reasonably requested by the Company to give effect to such release.

 

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Section 6. Counterparts . This Amendment may be executed in any number of counterparts and by different parties hereto on separate counterparts (including by facsimile or other electronic transmission (i.e., a “pdf” or “tif”)), each of which when so executed and delivered shall be deemed to be an original, but all of which shall together constitute one and the same instrument. A set of counterparts executed by all the parties hereto shall be lodged with the Company and the U.S. Administrative Agent.

Section 7. Governing Law; Submission to Jurisdiction; Venue; Waiver of Jury Trial .

(a) THIS AMENDMENT ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO THIS AMENDMENT, WHETHER IN TORT, CONTRACT (AT LAW OR IN EQUITY) OR OTHERWISE, SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAW PRINCIPLES EXCEPT FEDERAL LAWS RELATING TO NATIONAL BANKS.

(b) Sections 13.08(b) and (c) of the Amended Credit Agreement are incorporated herein by reference, mutatis mutandis .

Section 8. Headings . The headings of the several Sections and subsections of this Amendment are inserted for convenience only and shall not in any way affect the meaning or construction of any provision of this Amendment.

Section 9. Effect of this Amendment . Except as expressly set forth herein, (i) this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the Lenders, the Issuing Banks, the Administrative Agent or the Collateral Agent, in each case under the Credit Agreement or any other Credit Document, (ii) shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Credit Agreement or any other Credit Document and (iii) each and every term, condition, obligation, covenant and agreement contained in the Credit Agreement or any other Credit Document is hereby ratified and re-affirmed in all respects and shall continue in full force and effect. Each of the Credit Parties hereby consents to this Amendment and confirms and reaffirms (i) that all obligations of such Credit Party under the Credit Documents to which such Credit Party is a party shall continue to apply to the Credit Agreement as amended hereby, (ii) its Guarantees of the Relevant Guaranteed Obligations, (iii) its pledges and grants of security interests and Liens on the Collateral to secure the Obligations pursuant to the Security Documents and (iv) such Guarantees, pledges and grants of security interests, as applicable, shall continue to be in full force and effect and shall continue to inure to the benefit of the Lenders and the other Secured Creditors. This Amendment shall constitute a Credit Document for all purposes of the Credit Agreement. On and after the effectiveness of this Amendment, each reference in any Credit Document to “the Credit Agreement” shall mean and be a reference to the Amended Credit Agreement and each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof” or words of like import shall mean and be a reference to the Amended Credit Agreement. The parties hereto acknowledge and agree that the amendment of the Credit Agreement pursuant to this Amendment and all other Credit Documents amended and/or executed and delivered in connection herewith shall not constitute a novation of the Credit Agreement or of any other Credit Documents as in effect prior to the Second Amendment Effective Date.

 

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Section 10. Miscellaneous .

(a) This Amendment shall be binding upon and inure to the benefit of the Credit Parties and their respective successors and permitted assigns, and upon the Administrative Agent, the Issuing Banks and the Lenders and their respective successors and permitted assigns.

(b) This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. Delivery of an executed counterpart of a signature page of this Amendment by facsimile transmission or other electronic transmission (i.e., a “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Amendment.

[Remainder of page intentionally left blank]

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed by their respective authorized officers as of the day and year first above written.

 

[Signature Page to Second Amendment]

[Signature Page to Second Amendment]

[Signature Page to Second Amendment]

[Signature Page to Second Amendment]

[Signature Page to Second Amendment]

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[Signature Page to Second Amendment]

				TD Bank, N.A., as a Lender
				By:		/s/ Edmundo Kahn
						Name: Edmundo Kahn
						Title: Vice-President
For any institution requiring
a second signatory:				By:
						Name:
						Title:

[Signature Page to Second Amendment]

				The Toronto-Dominion Bank, as a Lender
				By:		/s/ Ron E. Gordon
						Name: Ron E. Gordon
						Title: Director
For any institution requiring
a second signatory:				By:		/s/ Darcy Mack
						Name: Darcy Mack
						Title: AVP

[Signature Page to Second Amendment]

[Signature Page to Second Amendment]

Exhibit A

Amended Credit Agreement

[See attached]

 

 

Execution Version

CREDIT AGREEMENT

among

RESOLUTE FOREST PRODUCTS INC.,

as Company,

RESOLUTE FP CANADA INC.,

Certain of the Company’s subsidiaries from time to time party hereto as Borrowers and Guarantors,

VARIOUS LENDERS,

BANK OF AMERICA, N.A.,

as U.S. ADMINISTRATIVE AGENT and COLLATERAL AGENT,

BANK OF AMERICA, N.A. (ACTING THROUGH ITS CANADA BRANCH),

as CANADIAN ADMINISTRATIVE AGENT

 

 

Dated as of May 22, 2015, 2015

(as amended by the First Amendment dated as of December 22, 2017

and as further amended by the Second Amendment dated as of May 14, 2019),

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

BMO CAPITAL MARKETS CORP.,

BARCLAYS BANK PLC

and

WELLS FARGO TD BANK, N.A.

and

CANADIAN IMPERIAL BANK OF COMMERCE ,

as CO-DOCUMENTATION AGENTS ,

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

BMO CAPITAL MARKETS CORP. ,

BARCLAYS BANK PLC

and

WELLS FARGO BANK, N.A.,

as CO-SYNDICATION AGENTS,

BOFA SECURITIES, INC.,

BMO CAPITAL MARKETS CORP.,

and

WELLS FARGO BANK, N.A.,

as JOINT LEAD ARRANGERS and JOINT BOOKRUNNERS

 

 

 

TABLE OF CONTENTS

 

				Page
SECTION 1		DEFINITIONS AND ACCOUNTING TERMS			1
1.01.		Defined Terms			1
1.02.		Terms Generally			58 69
1.03.		Uniform Commercial Code and PPSA			58 70
1.04.		Exchange Rates; Currency Equivalent			59 70
1.05.		Interpretation (Quebec)			59 70
1.06.		Currency Fluctuations			59 71
1.07.		Divisions			71
SECTION 2		AMOUNT AND TERMS OF CREDIT			60 71
2.01.		Commitments			60 71
2.02.		Loans			60 72
2.03.		Borrowing Procedure			62 74
2.04.		Evidence of Debt; Repayment of Loans			63 75
2.05.		Fees			64 76
2.06.		Interest on Loans			65 77
2.07.		Termination and Reduction of Commitments			67 79
2.08.		Interest Elections			67 79
2.09.		Optional and Mandatory Prepayments of Loans			69 81
2.10.		Payments Generally; Pro Rata Treatment; Sharing of Setoffs			72 84
2.11.		Defaulting Lenders			74 86
2.12.		Swingline Loans			74 86
2.13.		Letters of Credit			76 88
2.14.		Settlement Amongst Lenders			82 95
2.15.		Revolving Commitment Increase			83 95
2.16.		[Reserved]			84 97
2.17.		Overadvances			84 97
2.18.		Protective Advances			85 98
2.19.		Extended Loans			86 98
2.20.		Adjustment of Revolver Commitments			88 100
2.21.		FILO Exchange			89 102
2.22.		Subsidiary Borrowers			90 103
SECTION 3		YIELD PROTECTION, ILLEGALITY AND REPLACEMENT OF LENDERS			91 104
3.01.		Increased Costs, Illegality, etc.			91 104
3.02.		Compensation			93 106
3.03.		Change of Lending Office			93 106
3.04.		Replacement of Lenders			94 106
3.05.		[Reserved] Inability to Determine Rates			94 107
3.06.		LIBOR Successor Rate			108

 

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				Page
SECTION 4		[RESERVED]			94 109
SECTION 5		TAXES			94 109
5.01.		Net Payments			94 109
SECTION 6		CONDITIONS PRECEDENT TO CREDIT EVENTS ON THE CLOSING DATE			97 111
6.01.		Closing Date; Credit Documents			97 111
6.02.		Officer’s Certificate			97 111
6.03.		Opinions of Counsel			97 112
6.04.		Corporate Documents; Proceedings, etc.			97 112
6.05.		Solvency Certificate			98 112
6.06.		Borrowing Base Certificate			98 112
6.07.		Material Adverse Effect			98 112
6.08.		Fees, etc.			98 112
6.09.		Security Agreements			98 112
6.10.		Lender Loss Sharing Agreement			98 113
6.11.		Financial Statements			98 113
6.12.		Patriot Act			99 113
6.13.		Insurance			99 113
6.14.		Repayment of Obligations of Existing Credit Agreement			99 113
SECTION 7		CONDITIONS PRECEDENT TO ALL CREDIT EVENTS			99 114
7.01.		Notice of Borrowing			99 114
7.02.		Availability			99 114
7.03.		No Default			99 114
7.04.		Representations and Warranties			100 114
SECTION 8		REPRESENTATIONS, WARRANTIES AND AGREEMENTS			100 114
8.01.		Organizational Status			100 114
8.02.		Power and Authority			100 115
8.03.		No Violation			100 115
8.04.		Approvals			101 115
8.05.		Financial Statements; Financial Condition; Projections			101 116
8.06.		Litigation			102 116
8.07.		True and Complete Disclosure			102 116
8.08.		Use of Proceeds; Margin Regulations			102 116
8.09.		Tax Returns and Payments			102 117
8.10.		ERISA			103 117
8.11.		The Security Documents			103 117
8.12.		[Reserved]			104 118
8.13.		[Reserved] EEA Financial Institutions			104 118
8.14.		Subsidiaries			104 118
8.15.		Compliance with Statutes, OFAC Rules and Regulations; Patriot Act; FCPA			104 118
8.16.		Investment Company Act			105 119
8.17.		[Reserved]			105 119

 

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				Page
8.18.		Environmental Matters			105 120
8.19.		Labor Relations			105 120
8.20.		Intellectual Property			105 120
8.21.		[Reserved]			106 120
8.22.		Borrowing Base Certificate			106 120
8.23.		[Reserved]			106 121
8.24.		Canadian Pension Plans			106 121
SECTION 9		AFFIRMATIVE COVENANTS			106 121
9.01.		Information Covenants			106 121
9.02.		Books, Records and Inspections			109 124
9.03.		Maintenance of Property; Insurance			110 125
9.04.		Existence; Franchises			110 125
9.05.		Compliance with Statutes, etc.			111 126
9.06.		Compliance with Environmental Laws			111 126
9.07.		ERISA			111 126
9.08.		[Reserved]			112 127
9.09.		[Reserved]			112 127
9.10.		Payment of Taxes			112 127
9.11.		Use of Proceeds			112 127
9.12.		Additional Security; Further Assurances; etc.			112 127
9.13.		Post-Closing Actions			114 129
9.14.		Collateral Requirement			114 129
9.15.		Canadian Pension Plans			116 131
9.16.		Designation of Unrestricted Subsidiaries			116 132
9.17.		Collateral Monitoring and Reporting			117 132
SECTION 10		NEGATIVE COVENANTS			122 137
10.01.		Liens			122 138
10.02.		Consolidation, Merger, or Sale of Assets, etc.			126 143
10.03.		Restricted Payments			130 146
10.04.		Indebtedness			131 147
10.05.		Advances, Investments and Loans			134 150
10.06.		Transactions with Affiliates			136 154
10.07.		Limitations on Payments of Indebtedness; Modifications of Senior Notes Indenture, Certificate of Incorporation, By-Laws and Certain Other Agreements, etc.			137 154
10.08.		Limitation on Certain Restrictions on Subsidiaries			138 155
10.09.		Business			139 157
10.10.		Negative Pledges			139 157
10.11.		Financial Covenant			141 158
10.12.		Canadian Pension Plans			141 159
SECTION 11		EVENTS OF DEFAULT			142 160
11.01.		Payments			142 160
11.02.		Representations, etc.			142 160
11.03.		Covenants			142 160
11.04.		Default Under Other Agreements			143 160

 

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				Page
11.05.		Bankruptcy, etc.			143 161
11.06.		ERISA; Canadian Pension Plans			144 162
11.07.		Credit Documents			144 162
11.08.		Guaranties			144 162
11.09.		Judgments			144 162
11.10.		Change of Control			144 162
11.11.		Application of Funds			145 163
SECTION 12		THE ADMINISTRATIVE AGENT			148 166
12.01.		Appointment and Authorization			148 166
12.02.		Delegation of Duties			149 167
12.03.		Liability of Agents			149 167
12.04.		Reliance by the Agents			149 168
12.05.		Notice of Default			150 168
12.06.		Credit Decision; Disclosure of Information by the Agents			150 168
12.07.		Indemnification of the Agents			151 169
12.08.		Administrative Agent in Its Individual Capacity			151 169
12.09.		Successor Administrative Agent			151 170
12.10.		Administrative Agent May File Proofs of Claim			152 170
12.11.		Collateral and Guaranty Matters			153 172
12.12.		Bank Product Providers			153 172
12.13.		Administrative Agent and the Collateral Agent			153 172
12.14.		Withholding Taxes			154 173
12.15.		Certain ERISA Matters			173
SECTION 13		MISCELLANEOUS			154 174
13.01.		Payment of Expenses, etc.			154 174
13.02.		Right of Setoff			155 176
13.03.		Notices			156 176
13.04.		Benefit of Agreement; Assignments; Participations, etc.			156 177
13.05.		No Waiver; Remedies Cumulative			158 179
13.06.		[Reserved] Severability			158 179
13.07.		Calculations; Computations			159 179
13.08.		GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE; WAIVER OF JURY TRIAL			159 180
13.09.		Counterparts			160 180
13.10.		[Reserved] Canadian Severability			160 181
13.11.		Headings Descriptive			160 181
13.12.		Amendment or Waiver; etc.			160 181
13.13.		Survival			162 183
13.14.		Domicile of Loans			162 183
13.15.		Register			162 183
13.16.		Confidentiality			163 184
13.17.		USA Patriot Act Notice			164 185
13.18.		[Reserved] Acknowledgment and Consent to Bail-In of EEA Financial Institutions			164 185
13.19.		Waiver of Sovereign Immunity			164 185
13.20.		Canadian Anti-Money Laundering Legislation			164 186
13.21.		[Reserved] Entire Agreement			165 186
13.22.		Absence of Fiduciary Relationship			165 186

 

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				Page
13.23.		Electronic Signatures			165 187
13.24.		Judgment Currency			165 187
13.25.		Acknowledgement Regarding Any Supported QFCs			187
SECTION 14		CREDIT PARTY GUARANTY			165 188
14.01.		The Guaranty			165 188
14.02.		Bankruptcy			166 188
14.03.		Nature of Liability			166 189
14.04.		Independent Obligation			167 189
14.05.		Authorization			167 189
14.06.		Reliance			168 190
14.07.		Subordination			168 190
14.08.		Waiver			168 191
14.09.		Maximum Liability			169 191
14.10.		Payments			169 192
14.11.		Keepwell			169 192
14.12.		Information			169 192
14.13.		Severability			192
14.14.		Canadian Severability			192

 

SCHEDULE 1.01A		Unrestricted Subsidiaries
SCHEDULE 1.01B		Existing Letters of Credit
SCHEDULE 1.01C		Immaterial Subsidiaries
SCHEDULE 1.01D		U.K. Tax Schedule
SCHEDULE 2.01		Commitments
SCHEDULE 8.14		Subsidiaries
SCHEDULE 8.24		Canadian Pension Plans
SCHEDULE 9.13		Post-Closing Actions
SCHEDULE 9.17(e)		Deposit Accounts
SCHEDULE 9.17(g)		Location of Inventory
SCHEDULE 10.01(iii)		Existing Liens
SCHEDULE 10.04(vii)		Existing Indebtedness
SCHEDULE 10.05(iii)		Existing Investments
EXHIBIT A-1		Form of Notice of Borrowing
EXHIBIT A-2		Form of Notice of Conversion/Continuation
EXHIBIT B-1		Form of U.S. Revolving Note
EXHIBIT B-2		Form of Canadian Revolving Note
EXHIBIT B-3		Form of U.S. Swingline Note
EXHIBIT B-4		Form of Canadian Swingline Note
EXHIBIT C		Form of U.S. Tax Compliance Certificate
EXHIBIT D		Form of Lender Loss Sharing Agreement
EXHIBIT E-1		Form of U.S. Security Agreement
EXHIBIT E-2		Form of Canadian Security Agreement
EXHIBIT F		Form of Solvency Certificate
EXHIBIT G		Form of Compliance Certificate
EXHIBIT H		Form of Assignment and Assumption Agreement
EXHIBIT I		Form of Assignment Notice
EXHIBIT J		Insurance Policy [Reserved]
EXHIBIT K		Form of Borrower Designation Request and Assumption Agreement
EXHIBIT L		Form of Borrower Designation Notice

 

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THIS CREDIT AGREEMENT, dated as of May 22, 2015, among RESOLUTE FOREST PRODUCTS INC. (the “ Company ”), RESOLUTE FP CANADA INC. ( “ RFP Canada ”) and each of the other Borrowers (as hereinafter defined) and Guarantors (as hereinafter defined) party hereto, the Lenders party hereto from time to time, BANK OF AMERICA, N.A., as the Administrative Agent under the U.S. Subfacility (in such capacity, the “ U.S. Administrative Agent ”) and Collateral Agent (in such capacity, the “ Collateral Agent ”) and BANK OF AMERICA, N.A. (ACTING THROUGH ITS CANADA BRANCH), as the Administrative Agent under the Canadian Subfacility (in such capacity, the “ Canadian Administrative Agent ”). All capitalized terms used herein and defined in Section 1.01 are used herein as therein defined.

W I T N E S S E T H :

WHEREAS, (a) the Borrowers have requested that the Lenders extend credit in the form of Revolving Loans in an aggregate principal amount at any time outstanding not to exceed $ 600,000,000, 500,000,000, consisting of a U.S. Subfacility in an initial aggregate principal amount of $ 150,000,000 200,000,000 (the “ U.S. Subfacility ”) and a Canadian Subfacility in an initial aggregate principal amount of $ 450,000,000 300,000,000 (the “ Canadian Subfacility ” and, together with the U.S. Subfacility, the “ Subfacilities ”), (b) the Borrowers have requested that the Issuing Banks issue Letters of Credit in an aggregate stated amount at any time outstanding not to exceed $200,000,000 and (c) the Borrowers have requested the Swingline Lenders to extend credit in the form of Swingline Loans in an aggregate principal amount at any time outstanding not to exceed $ 60,000,000. 60,000,000; and

WHEREAS, pursuant to the First Amendment, this Agreement was amended to cure certain errors or omissions of a technical or immaterial nature.

NOW THEREFORE, the Lenders are willing to extend such credit to the Borrowers, the Swingline Lenders are willing to make Swingline Loans to the Borrowers and the Issuing Banks are willing to issue Letters of Credit for the account of the Borrowers on the terms and subject to the conditions set forth herein.

Section 1 Definitions and Accounting Terms .

1.01. Defined Terms . As used in this Agreement, the following terms shall have the following meanings:

“ ABL Priority Collateral ” shall mean all present and future right, title and interest of the Credit Parties in the following types of Collateral, whether now owned or hereafter acquired, existing or arising and wherever located: (i) all Accounts, including all Accounts (as such term is defined in the U.S. Security Agreement and in the Canadian Security Agreement); (ii) all cash and all Deposit Accounts and all monies deposited therein; (iii) all Inventory; (iv) all commodities contracts, commodities accounts, securities and securities accounts (and security entitlements or financial assets credited thereto), in each case other than Equity Interests of any Person; (v) to the extent evidencing or governing any of the items referred to in the preceding clauses (i) through (iv), (A) all documents, (B) all chattel paper (including all tangible chattel paper and all electronic chattel paper), (C) all general intangibles (excluding Intellectual Property), (D) all contracts (together with all contract rights arising thereunder) and (E) all instruments; (vi) the Pledged Debt Securities (as defined in the applicable Security Agreements) ; (vii) to the extent securing or supporting any of the items referred to in the preceding clauses (i) through (v), all supporting obligations, commercial tort claims and letter of credit rights (whether or not the respective letter of credit is evidenced by a writing); (viii) all books and records pertaining to the foregoing; and (ix) all products and proceeds of the foregoing (including all insurance and claims for insurance effected or held for the benefit of the Credit Parties or the Secured Creditors in respect thereof and all collateral security and guarantees given by any Person with respect to any of the foregoing).

“ Account Debtor ” shall mean any Person who may become obligated to another Person under, with respect to, or on account of, an Account.

“ Accounts ” shall mean all “accounts,” as such term is defined in the UCC (or, with respect to any Canadian Credit Party, the PPSA, or in the case of any accounts of the English Credit Party means any obligation (present, future or contingent) of an Account Debtor to make payment under a contract of sale of goods or services together with all associated and related rights) in which any Person now or hereafter has rights, including all rights to payment for goods sold or leased or for services rendered.

“ Acquired Entity or Business ” shall mean either (x) the assets constituting a business, division or product line of any Person not already a Subsidiary of the Company or (y) 100% of the Equity Interests of any such Person, which Person shall, as a result of the respective acquisition, become a Wholly-Owned Subsidiary of the Company (or shall be merged or amalgamated with and into the Company or a Wholly-Owned Subsidiary of the Company).

“ Additional Security Documents ” shall have the meaning provided in Section 9.12(a) .

“ Adjustment Date ” shall mean the first day of January, April, July and October of each fiscal year.

“ Administrative Agent ” shall mean the U.S. Administrative Agent and/or the Canadian Administrative Agent, as the context may require, and shall include any successor to the Administrative Agent appointed pursuant to Section 12.09 .

“ Affiliate ” shall mean, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under direct or indirect common control with, such Person. A Person shall be deemed to control another Person if such Person possesses, directly or indirectly, the power to direct or cause the direction of the management and policies of such other Person, whether through the ownership of voting securities, by contract or otherwise; provided , however , that neither the Administrative Agent nor any Lender (nor any Affiliate thereof) shall be considered an Affiliate of the Company or any Subsidiary thereof as a result of this Agreement, the extensions of credit hereunder or its actions in connection therewith.

“ Agent-Related Persons ” shall mean the Administrative Agent, the Collateral Agent, their respective affiliates and the officers, directors, employees, agents and attorneys-in-fact of the Administrative Agent, the Collateral Agent and their respective affiliates.

“ Agents ” shall mean the Administrative Agent, the Collateral Agent, the Co-Documentation Agents , the Co-Syndication Agents and any other agent with respect to the Credit Documents, including, without limitation, the Joint Lead Arrangers.

“ Agreement ” shall mean this Credit Agreement, as modified, supplemented, amended (including pursuant to the First Amendment and the Second Amendment) , restated (including any amendment and restatement hereof), extended or renewed from time to time.

“ AML Legislation ” shall have the meaning provided in Section 13.20 .

 

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“ Anti-Terrorism Laws ” shall mean any laws relating to terrorism or money laundering, including the PATRIOT Act, the Beneficial Ownership Regulation, the Criminal Code R.S.C. 1985, c. c-46, as amended, AML Legislation, the United Nations Act, R.S.C. 1985 c. u-2, as amended, Regulations Implementing the United Nations Resolutions on the Suppression of Terrorism and the United Nations al-Qaida and Taliban Regulations promulgated under the United Nations Act, together with any similar Canadian legislation, rules, regulations and interpretations thereunder or related thereto.

“ Applicable Collateral ” shall mean (a) with respect to the Obligations of the U.S. Credit Parties, the U.S. Collateral, (b) with respect to the Obligations of the Canadian Credit Parties, the Canadian Collateral, the U.S. Collateral and the U.K. Collateral and (c) with respect to the Obligations of the English Credit Parties, the U.K. Collateral.

“ Applicable Margin ” shall mean with respect to any Type of Revolving Loan, the per annum margin set forth below, as determined by the Average Availability as of the most recent Adjustment Date:

 

Level		Average Availability (percentage of Line Cap)		U.S. Base Rate Loans, Canadian Base Rate Loans and Canadian Prime Rate Loans		LIBOR LIBO   Rate Loans and B/A Equivalent CDOR Rate Loans
I		< 50%		0.50%		1.50%
I II		³   67 50 %		0.25%		1.25%
II		³  33%  <  67%		0.50%		1.50%
III		< 33%		0.75%		1.75%

provided that after 18 months after the Closing Date, whenever the Company is in compliance with a Total Leverage Ratio of 1.75:1.00, the Applicable Margin shall be set forth as in the below:

 

Level		Average Availability (percentage of Line Cap)		U.S. Base Rate Loans, Canadian Base Rate Loans and Canadian Prime Loans		LIBOR Rate Loans and B/A Equivalent Loans
I		³  67%		0.00%		1.00%
II		³  33% < 67%		0.50%		1.50%
III		< 33%		0.75%		1.75%

The Applicable Margin with respect to any Type of FILO Loan shall be the per annum margin set forth below, as determined by the Average Availability as of the most recent Adjustment Date:

 

Level		Average Availability (percentage of Line Cap)		U.S. Base Rate Loans, Canadian Base Rate Loans and Canadian Prime Loans		LIBOR Rate Loans and B/A Equivalent Loans
I		> 67%		1.50%		2.50%
II		> 33% < 67%		1.75%		2.75%
III		< 33%		2.00%		3.00%

 

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provided that after 18 months after the Closing Date, whenever the Company is in compliance with a Total Leverage Ratio of 1.75: 1.00, the Applicable Margin for FILO Loans shall be set forth as in the below:

 

Level		Average Availability (percentage of Line Cap)		U.S. Base Rate Loans, Canadian Base Rate Loans and Canadian Prime Rate Loans		LIBOR LIBO  Rate Loans  and  B/A Equivalent CDOR Rate Loans
I		³  67 < 50 %		1.25 0.25 %		2.25 1.25 %
II		³   33%  <  67 50 %		1.75 0.00 %		2.75 1.00 %
III		< 33%		2. 00%		3. 00%

Until completion of the first full fiscal quarter after the Closing Second Amendment Effective Date, the Applicable Margin with respect to any Type of Revolving Loan shall be determined as if Level II when the Company is in compliance with a Total Leverage Ratio of 1.75: 1.00 were applicable. Thereafter, the Applicable Margin with respect to any Type of Revolving Loan shall be subject to increase or decrease on each Adjustment Date based on Average Availability, as determined by the Administrative Agent’s system of record, and each such increase or decrease in the Applicable Margin shall be effective on the Adjustment Date occurring immediately after the last day of the fiscal quarter most recently ended. If (i) the Borrowers fail to deliver any Borrowing Base Certificate on or before the date required for delivery thereof or (ii) any Event of Default exists, then, at the option of the Required Lenders, the Applicable Margin with respect to any Type of Revolving Loan shall be determined as if Level III II were applicable, from the first day of the calendar month following the date such Borrowing Base Certificate was required to be delivered or from the date such Event of Default occurred, as applicable, until the date of delivery of such Borrowing Base Certificate or when such Event of Default is no longer continuing.

The Applicable Margin with respect to any Type of FILO Loan shall be the per annum margin (s) set forth in the relevant FILO Amendment.

“ Applicable Specified Secured Indebtedness ” shall have the meaning assigned that term in Section 9.14(a).

“ Approved Country ” shall mean (1)  the United States, Canada, any country within the European Area, and any other country other than those Australia, Hong Kong, New Zealand, Norway, Switzerland, Singapore Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden and the United Kingdom, and (2) any other country which the Administrative Agent at any time may agree in its Permitted Discretion shall constitute an Approved Country (but such determination shall not become effective until three Business Days after written notice of such determination is re ceived by the Company ); provided that no country shall constitute an Approved Country pursuant to this clause (2) :

(i) whose government or central bank (x) shall have prohibited the sale of the currency of such country in exchange for U.S. Dollars or Canadian Dollars or (y) shall have admitted in writing its inability to pay its debts as the same become due or shall have declared a moratorium on the payment of its debts or the debts of any national governmental authority of such country; provided , however , that this clause (y) shall not apply to any Account which would otherwise constitute a an Eligible Insured and Letter of Credit Backed Account; or

(ii) with respect to which the United States shall have imposed economic sanctions.

 

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“ Approved DIP Account ” shall mean an Account (i) in respect of which the Account Debtor is debtor in a case under Chapter 11 of the Bankruptcy Code, (ii) which arises after the commencement of the case described in (i) and is therefore entitled to priority as an administrative expense in such case and (iii) which has been approved for purposes of this Agreement by the Collateral Agent in its Permitted Discretion.

“ Approved Fund ” shall mean any Person (other than a natural Person) engaged in making, purchasing, holding or otherwise investing in commercial loans in its ordinary course of activities 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.

“ Asset Exchange ” shall mean any transfer of operating properties or assets by the Company or any of its Restricted Subsidiaries to any Person in which at least 75% of the consideration received by the transferor consists of operating properties or assets to be used by the Company or any of its Restricted Subsidiaries in its business ; provided that a transfer of ABL Priority Collateral the consideration of which consists of assets that are not ABL Priority Collateral shall not constitute an Asset Exchange.

“ Assignment and Assumption Agreement ” shall mean an Assignment and Assumption Agreement substantially in the form of Exhibit H (appropriately completed) or such other form as shall be acceptable to the Administrative Agent.

“ Availability ” shall mean, as of any applicable date, the amount by which the Line Cap at such time exceeds the Revolving Exposures on such date.

“ Availability Conditions ” shall be deemed satisfied only if:

(a) each Lender’s U.S. Revolving Exposure does not exceed such Lender’s U.S. Revolving Commitment;

(b) each Lender’s Canadian Revolving Exposure does not exceed such Lender’s Canadian Revolving Commitment;

(c) the sum of (i) the aggregate U.S. Revolving Exposure of all Lenders plus (ii) the aggregate Canadian Revolving Exposure in respect of Canadian Revolving Loans made to the U.S. Borrowers plus (iii) the aggregate Canadian Revolving Exposure in respect of Canadian Revolving Loans made to the Canadian Borrowers in reliance on clause (d) of the definition of “Canadian Borrowing Base” does not exceed the U.S. Borrowing Base then in effect; and

(d) the aggregate Canadian Revolving Exposure in respect of Canadian Revolving Loans to the Canadian Borrowers does not exceed the Canadian Borrowing Base then in effect.

“ Average Availability ” shall mean, at any Adjustment Date, the average daily Availability for the fiscal quarter immediately preceding such Adjustment Date, or such other period of days as the context may require.

“ Average Usage ” shall mean the average utilization of Revolving Commitments during the immediately preceding fiscal quarter.

“ B/A Equivalent Loan ” shall mean a Canadian Revolving Loan (other than a Canadian Prime Loan), or portion thereof, funded in Canadian Dollars and bearing interest calculated by reference to the Canadian B/A Rate.

 

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“ Bank of Canada Overnight Rate ” shall mean the Bank of Canada overnight rate, which is the rate of interest charged by the Bank of Canada on one-day loans to financial institutions, for such day. 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.

“ Bank Product ” shall mean any of the following products, services or facilities extended to any Borrower or any of Company’s Subsidiaries: (a) Cash Management Services; (b) products under Hedging Agreements; (c) commercial credit card and merchant card services; and (d) other banking products or services as may be requested by any Borrower, other than Letters of Credit.

“ Bank Product Debt ” shall mean Indebtedness and other obligations of a Borrower or any of Company’s Subsidiaries relating to Bank Products.

“ Bankruptcy Code ” shall have the meaning provided in Section 11.05 .

“ Beneficial Ownership Certification” shall mean a certification regarding beneficial ownership required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” shall mean 31 C.F.R. Section 1010.230.

“Benefit Plan” shall mean any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in and subject to Section 4975 of the Code or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the Code) the assets of any such “employee benefit plan” or “plan.”

“ Borrowers ” shall mean the U.S. Borrowers, the Canadian Borrowers and the U.K. Borrowers, if any.

“ Borrowing ” shall mean the borrowing of the same Type and Class of Revolving Loan or FILO Loan (as applicable) by the Borrowers from all the Lenders having Commitments on a given date (or resulting from a conversion or conversions on such date), having in the case of LIBOR LIBO Rate Loans and CDOR Rate Loans, the same Interest Period and in the case of B/A Equivalent Loans, the same Contract Period ; provided that U.S. Base Rate Loans and Canadian Prime Rate Loans incurred pursuant to Section 3.01 shall be considered part of the related Borrowing of LIBOR LIBO Rate Loans or B/A Equivalent CDOR Rate Loans, as applicable , and Canadian Prime Rate Loans incurred pursuant to Section 3.01 shall be considered part of the related Borrowing of CDOR Rate Loans .

“ Borrowing Base ” shall mean (a) with respect to the U.S. Revolving Commitment, the U.S. Borrowing Base, (b) with respect to the Canadian Revolving Commitment, the Canadian Borrowing Base, (c) with respect to the U.S. FILO Commitment, if any, the U.S. FILO Borrowing Base, (d) with respect to the Canadian FILO Commitment, if any, the Canadian FILO Borrowing Base and (e) the sum of the U.S. Borrowing Base, the Canadian Borrowing Base, the U.S. FILO Borrowing Base and Canadian FILO Borrowing Base, as the context may require. The Borrowing Base or any component thereof at any time shall be determined by reference to the most recent Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 9.17(a) .

 

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“ Borrowing Base Certificate ” shall mean a certificate of a Responsible Officer of the Company in form and substance satisfactory to the Administrative Agent.

“ Business Day ” shall mean (i) for all purposes other than as covered by clause (ii) below, any day except Saturday, Sunday and any day which shall be in New York City, Toronto, Ontario, Canada or Montreal, Quebec, Canada a legal holiday or a day on which banking institutions are authorized or required by law or other government action to close and (ii) with respect to all notices and determinations in connection with, and payments of principal and interest on, LIBOR LIBO Rate Loans, any day which is a Business Day described in clause (i) above and which is also a day for trading by and between banks in the New York or London interbank Eurodollar market.

“ Canadian Administrative Agent ” shall have the meaning set forth in the recitals hereto.

“ Canadian B/A Rate ” shall mean with respect to each Contract Period for a B/A Equivalent Loan or Canadian Prime Loan determined pursuant to clause (c) of the definition of “Canadian Prime Rate,” the rate of interest per annum equal to the average rate applicable to Canadian Dollar bankers’ acceptances having an identical or comparable term as the proposed B/A Equivalent Loan displayed and identified as such on the display referred to as the “CDOR Page” (or any display substituted therefor) of Reuters Monitor Money Rates Service as at approximately 10:00 a.m. Toronto time on such day (or, if such day is not a Business Day, as of 10:00 a.m. Toronto time on the immediately preceding Business Day); provided that if such rate does not appear on the CDOR Page at such time on such date, the rate for such date will be the average of the annual discount rate (rounded upward to the nearest whole multiple of 1/100 of 1%) as of 10:00 a.m. Toronto time on such day at which the Royal Bank of Canada is then offering to purchase Canadian Dollar bankers’ acceptances accepted by it having such specified term (or a term as closely as possible comparable to such specified term).

“ Canadian Base Rate ” shall mean, for any day, the greatest of (a)  the a per annum rate of interest in effect for such day as publicly announced by Bank of America, N.A. (acting through its Canada branch) from time to time by Bank of America, N.A. (acting through its Canada branch) in Toronto, Ontario as its “base rate” (the “base rate” being a rate set by Bank of America, N.A. (acting through its Canada branch) as its base rate for commercial loans made by it in Canada in Dollars, which rate is based on various factors , including its costs and desired return of Bank of America, N.A. (acting through its Canada branch) , general economic conditions and other factors, and is used as a reference point for pricing some loans in Dollars made in Canada at its “base rate,” , which may be priced at, above or below such announced rate ) , (b) the Federal Funds Rate for such day, plus 0.50 ¹ ⁄ ₂ of 1 %; or (c) the LIBOR LIBO Rate for a 30-day interest period as determined LIBO Rate Loan with a one month Interest Period commencing on such day , plus 1.00% (which, if negative, shall be deemed to be 0.00%) . Any change in the “base rate” announced by Bank of America, N.A. (acting through its Canada branch) Canadian Base Rate shall take effect at the opening of business on the day specified in the public announcement of such change. Each interest rate based upon the Canadian Base Rate shall be adjusted simultaneously with any change in the “ base rate.” In the event that Bank of America, N.A. (acting through its Canada branch) (including any successor or assignee) does not at any time publicly announce a “base rate,” then “Canadian Base Rate” shall mean the “base rate” publicly announced by a Schedule I chartered bank in Canada selected by the Administrative Agent applicable Business Day .

“ Canadian Base Rate Loan ” shall mean a Canadian Revolving Loan or Canadian FILO Loan denominated in U.S. Dollars that bears interest based on the Canadian Base Rate.

“ Canadian Borrower ” shall mean (i) Resolute FP Canada Inc. and (ii)  each Canadian Subsidiary of the Company that executes a counterpart hereto and to any other applicable Credit Document as a Borrower. is designated as an additional Canadian borrower hereunder in accordance with Section 2.22.

 

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“ Canadian Borrowing Base ” shall mean, at the time of any determination, an amount equal to the sum of the Dollar Equivalent, without duplication, of (a) (I) 85% of the aggregate Outstanding Balance of Eligible Canadian/English Accounts (other than Eligible Insured and Letter of Credit Backed Accounts and Eligible Investment Grade Accounts) at such time plus (II) 90% of the aggregate Outstanding Balance of Eligible Insured and Letter of Credit Backed Accounts owned by Canadian Credit Parties and English Credit Parties at such time plus (III) 90% of the aggregate Outstanding Balance of Eligible Investment Grade Accounts owned by Canadian Credit Parties and English Credit Parties at such time plus (b) the lesser of (i) 70% of Eligible Canadian/English Inventory at such time and (ii) 85% of the Net Orderly Liquidation Value of Eligible Canadian/English Inventory at such time (in each case with respect to clauses (i) and (ii) with any Eligible Canadian/English Inventory to be valued at the lower of cost or market value thereof (net of any intercompany profit)) plus (c)(i) 100% of all amounts on deposit in Canadian Dominion Accounts and English Dominion Accounts (in each case to the extent such amounts constitute cash held in deposit accounts) and (ii) 95% of all other amounts on deposit in securities accounts of a Canadian Credit Party or English Credit Party that are subject to the control of the Collateral Agent (in each case to the extent such amounts constitute Cash Equivalents of the type described in clause (a) of the definition thereof held in such securities accounts) plus (d) the positive amount, if any, by which the U.S. Borrowing Base exceeds the total U.S. Revolving Exposure of all Lenders minus (e) any Reserves established from time to time by the Administrative Agent in accordance with its Permitted Discretion; provided , however , that the aggregate amount arising under the preceding clause (c), together with the aggregate amount arising under clause (c) of the first sentence of the definition of “U.S. Borrowing Base,” shall not exceed $100,000,000. The Canadian Borrowing Base at any time shall be determined by reference to the most recent Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 9.17(a) , adjusted on a pro forma basis as necessary in the Permitted Discretion of the Administrative Agent (pending the delivery of a new Borrowing Base Certificate) to reflect the impact of any Significant Asset Sale (other than receivables to be factored which are sold pursuant to Section 10.02(iii) ) or any other event or circumstance which by the express terms of this Agreement alters the eligibility for inclusion in the Canadian Borrowing Base of Eligible Accounts, Eligible Inventory, Eligible Insured and Letter of Credit Backed Accounts or Eligible Investment Grade Accounts reflected in such Borrowing Base Certificate. The Administrative Agent shall have the right (but no obligation) to review the computations in any Borrowing Base Certificate and if, in its Permitted Discretion, such computations have not been calculated in accordance with the terms of this Agreement, the Administrative Agent shall have the right, in consultation with the Company, to correct any such errors in such manner as it shall determine in its Permitted Discretion and the Administrative Agent will notify the Company promptly after making any such correction.

“ Canadian Collateral ” shall mean all the “Collateral” (or equivalent term) as defined in each Canadian Security Agreement and all other property (whether real, personal or otherwise) with respect to which any security interests have been granted (or purported to be granted) by the Canadian Credit Parties pursuant to any Security Document (including any Additional Security Documents) or is required to be granted in accordance with the requirements set forth in Section 2.22 , Section 9.12 , Section 9.13 or Section 9.14 .

“ Canadian Collection Account ” shall mean each account established at a Canadian bank subject to a Deposit Account Control Agreement into which funds shall be transferred as provided in Section 9.17(c)(ii) .

“ Canadian Collection Bank ” shall mean any bank that maintains a Canadian Collection Account.

“ Canadian Credit Party ” shall mean the Canadian Borrowers and each Canadian Subsidiary Guarantor.

 

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“ Canadian Dilution Reserve ” shall mean, at any date, (i) the amount by which the consolidated Dilution Ratio of Eligible Canadian/English Accounts exceeds five percent (5%) multiplied by (ii) the Eligible Canadian/English Accounts on such date.

“ Canadian Dollars ” and “ C$ ” shall mean the lawful currency of Canada.

“ Canadian Dominion Account ” shall have the meaning set forth in Section 9.17 .

“ Canadian Employee Benefits Legislation ” shall mean the Pension Benefits Act (Ontario), as amended and any regulations promulgated thereunder, and any Canadian federal, provincial or local counterparts or equivalents, and includes the Canadian Pension Regulations and the Government Pension Agreements.

“ Canadian FILO Borrowing Base ” shall mean, at the time of any determination, an amount equal to the sum of the Dollar Equivalent, without duplication, of (a)  5% an advance rate to be agreed between the Canadian FILO Lenders and the Canadian Borrowers (which such advance rate shall be set forth in the relevant FILO Amendment) of the aggregate Outstanding Balance of Eligible Canadian/English Accounts plus (b)  10% of the Net Orderly Liquidation Value an advance rate to be agreed between the Canadian FILO Lenders and the Canadian Borrowers (which such advance rate shall be set forth in the relevant FILO Amendment) of Eligible Canadian/English Inventory at such time (to be valued at the lower of cost or market value thereof (net of any intercompany profit)); provided that such rate shall decrease to (i) 7.5% on the 2 and a half year anniversary of the Closing Date and (ii) 5% on the 3 year anniversary of the Closing Date , minus any Reserves established from time to time by the Administrative Agent in accordance herewith (without duplication of Reserves otherwise established in connection with the Canadian Borrowing Base). The Canadian FILO Borrowing Base at any time shall be determined by reference to the most recent Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 9.17(a) , adjusted on a pro forma basis as necessary in the Permitted Discretion of the Administrative Agent (pending the delivery of a new Borrowing Base Certificate) to reflect the impact of any Significant Asset Sale (other than receivables to be factored which are sold pursuant to Section 10.02(iii) or any other event or circumstance which by the express terms of this Agreement alters the eligibility for inclusion in the Canadian FILO Borrowing Base of Eligible Accounts or Eligible Inventory reflected in such Borrowing Base Certificate. The Administrative Agent shall have the right (but no obligation) to review the computations in any Borrowing Base Certificate and if, in its Permitted Discretion, such computations have not been calculated in accordance with the terms of this Agreement, the Administrative Agent shall have the right, in consultation with the Company, to correct any such errors in such manner as it shall determine in its Permitted Discretion and the Administrative Agent will notify the Company promptly after making any such correction.

“ Canadian FILO Commitment ” shall mean the commitment of the Canadian FILO Lenders under the Canadian FILO Subfacility to make Canadian FILO Loans hereunder up to the Canadian FILO Line Cap.

“ Canadian FILO Exchange Offer ” shall have the meaning given in Section 2.21(a) .

“ Canadian FILO Exposure ” shall mean, with respect to the Canadian FILO Lenders under a Canadian FILO Subfacility at any time, the aggregate principal amount at such time of all outstanding Canadian FILO Loans of such Lender under the Canadian FILO Subfacility.

“ Canadian FILO Lender ” shall mean any Lender hereunder that accepts a Canadian FILO Exchange Offer pursuant to Section 2.21 and has a resulting FILO Commitment under the Canadian FILO Subfacility.

 

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“ Canadian FILO Line Cap ” shall mean an amount equal to the lesser of (a) the FILO Commitments under the Canadian FILO Subfacility and (b) the Canadian FILO Borrowing Base.

“ Canadian FILO Loans ” shall mean advances made to or at the instructions of a Canadian Borrower pursuant to Section 2 hereof under the Canadian FILO Subfacility.

“ Canadian FILO Subfacility ” shall mean the Subfacility subfacility resulting from a Canadian FILO Exchange Offer, if any.

“ Canadian Issuing Bank ” shall mean, as the context may require, (a) Bank of America, N.A. (acting through its Canada branch) or any affiliates or branches of Bank of America, N.A. with respect to Canadian Letters of Credit issued by it; (b) any other Lender that may become an Issuing Bank pursuant to Sections 2.13(i) and 2.13(k) , with respect to Letters of Credit issued by such Lender; (c) with respect to any Existing Letter of Credit, the Lender which is the issuer of such Existing Letter of Credit; or (d) collectively, all of the foregoing.

“ Canadian LC Credit Extension ” shall mean, with respect to any Canadian Letter of Credit under the Canadian Subfacility, the issuance, amendment or renewal thereof or extension of the expiry date thereof, or the increase of the amount thereof.

“ Canadian LC Disbursement ” shall mean a payment or disbursement made by the Canadian Issuing Bank pursuant to a Canadian Letter of Credit under the Canadian Subfacility.

“ Canadian LC Documents ” shall mean all documents, instruments and agreements delivered by a Canadian Borrower or any other Person to the Canadian Issuing Bank or the Administrative Agent in connection with any Canadian Letter of Credit under the Canadian Subfacility.

“ Canadian LC Exposure ” shall mean at any time the sum of (a) the aggregate undrawn amount of all outstanding Canadian Letters of Credit at such time plus (b) the aggregate principal amount of all Canadian LC Disbursements that have not yet been reimbursed at such time. The Canadian LC Exposure of any Revolving Lender at any time shall mean its Pro Rata Percentage of the aggregate Canadian LC Exposure at such time.

“ Canadian LC Obligations ” shall mean the sum (without duplication) of (a) all amounts owing by the Canadian Borrowers in respect of any Canadian LC Disbursements (including any bankers’ acceptances or other payment obligations arising therefrom) and (b) the stated amount of all outstanding Canadian Letters of Credit.

“ Canadian Letter of Credit ” shall mean any letters of credit, usance letter of credit or foreign guarantee issued or to be issued by the Canadian Issuing Bank under the Canadian Subfacility requested by a Canadian Borrower, U.S. Borrower or U.K. Borrower, if any, pursuant to Section 2.13 .

“ Canadian Line Cap ” shall mean an amount that is equal to the lesser of (a) the Canadian Revolving Commitments and (b) the then applicable Canadian Borrowing Base.

“ Canadian Pension Plan ” shall mean each pension, supplementary pension, retirement savings or other retirement income plan or arrangement of any kind, registered or non-registered, established, maintained or contributed to by a Canadian Subsidiary of the Company for its or any of its current or previous Affiliates’ employees or former employees and includes for greater certainty “target benefit” and “multi- employer pension plans” as defined in the Pension Benefits Act (Ontario),” all Ontario Pension Plans and Quebec Pension Plans but shall not include the Canada Pension Plan (CPP) as maintained by the government of Canada or the Quebec Pension Plan (QPP) as maintained by the government of Quebec.

 

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“ Canadian Pension Regulations ” shall mean, collectively, the Ontario Pension Regulations and the Quebec Pension Regulations.

“ Canadian Perfection Certificate ” shall mean the Canadian Perfection Certificate in the form approved by the Collateral Agent, as the same may be supplemented from time to time pursuant to Section 9.01(c) or otherwise.

“ Canadian Prime Rate Loan ” shall mean a Canadian Revolving Loan or Canadian FILO Loan to the Canadian Borrowers denominated in Canadian Dollars which bears interest at a rate based upon the Canadian Prime Rate.

“ Canadian Prime Rate ” shall mean, on for any date period , the rate per annum rate of interest equal to the greatest determined by the Administrative Agent to be the higher of ( a i ) the per annum rate of interest in effect for such day or so designated announced by Bank of America, N.A. (acting through its Canada branch) from time to time by Bank of America, N.A. (acting through its Canada branch ) as its “ prime rate ” for commercial loans made by it in Canada in Canadian Dollars, such rate being a reference rate and not necessarily representing the lowest or best rate being charged to any customer; (b) the Bank of Canada Overnight Rate for such day, plus 0.50%; or (c) the Canadian B/A Rate for a one which rate is based on various factors, including its costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above or below such rate ; or (ii) the CDOR Rate for a one- month interest period as determined on of such day , plus 1.00% ; provided that in no event shall the Canadian Prime Rate be less than zero . Any change in such rate announced by Bank of America, N.A. (acting through its Canada branch) shall take effect at the opening of business on the day specified in the public announcement thereof applicable Business Day .

“ Canadian Priority Payables ” shall mean, at any time, with respect to the Canadian Borrowing Base:

(a) the amount due on or prior to the date as of which the Canadian Borrowing Base is to be determined and remaining unpaid at the time of determination by any Canadian Credit Party (or any other Person for which any Canadian Credit Party has joint and several liability), for which each Canadian Credit Party has an obligation to remit to a Governmental Authority or other Person pursuant to any applicable law, rule or regulation, in respect of (i) pension fund obligations including wind-up deficiencies on any wind-up or termination of any Ontario Pension Plan and employee and employer pension plan contributions (including “normal cost,” “special payments” and any other payments in respect of any funding deficiency or shortfall), (ii) employment insurance, (iii) goods and services taxes, sales taxes, employee income taxes, excise tax and other taxes payable or to be remitted or withheld, (iv) workers’ compensation, (v) wages, salaries, commission or compensation, including vacation pay, and (vi) other like charges and demands ; , in each case in respect of which any Governmental Authority or other Person may claim a security interest, hypothecation, prior claim, trust or other claim or Lien ranking or capable of ranking in priority to or pari passu with one or more of the Liens granted pursuant to the Security Documents (a “ Priority Lien ”); and

(b) the aggregate amount due on or prior to the date as of which the Canadian Borrowing Base is to be determined and remaining unpaid at the time of determination of any other liabilities of the Canadian Credit Parties (or any other Person for which the Canadian Credit Parties have joint and several liability) (i) in respect of which a trust has been or may be

 

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imposed on Collateral of any Canadian Credit Party to provide for payment or (ii) which are secured by a security interest, hypothecation, prior claim, pledge, charge, right, or claim or other Lien on any Collateral of any Canadian Credit Party, in each case pursuant to any applicable law, rule or regulation and which trust, security interest, hypothecation, prior claim, pledge, charge, right, claim or other Lien ranks or is capable of ranking in priority to or pari passu with one or more of the Liens granted in the Security Documents.

“ Canadian Priority Payables Reserve ” shall mean, on any date of determination for the Canadian Borrowing Base, a reserve established from time to time by the Collateral Agent in its Permitted Discretion in such amount as the Collateral Agent may reasonably determine in respect of Canadian Priority Payables of the Canadian Credit Parties; provided , that without otherwise limiting the Collateral Agent’s Permitted Discretion, the Canadian Priority Payables Reserve shall include a reserve for Canadian Priority Payables in an amount up to the amount of Canadian Priority Payables set forth on the most recent Borrowing Base Certificate (as the same may be reduced or increased by the next succeeding Borrowing Base Certificate) delivered to the Administrative Agent pursuant to Section 9.17(a) .

“ Canadian Protective Advances ” shall have the meaning assigned to such term in Section 2.18 .

“ Canadian Revolving Borrowing ” shall mean a Borrowing comprised of Canadian Revolving Loans or Canadian FILO Loans.

“ Canadian Revolving Commitment ” shall mean, with respect to each Canadian Revolving Lender, the commitment, if any, of such Lender to make Canadian Revolving Loans hereunder up to the amount set forth and opposite such Lender’s name on Schedule 2.01 under the caption “Canadian Revolving Commitment,” or in the Assignment and Assumption Agreement pursuant to which such Lender assumed its Canadian Revolving Commitment, as applicable, as the same may be (a) reduced from time to time pursuant to Section 2.07 , (b) reduced from time to time pursuant to Section 2.21 and (c) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 13.04 . The aggregate amount of the Canadian Revolving Lenders’ Canadian Revolving Commitments on the Closing Second Amendment Effective Date is $ 450,000,000. 300,000,000.

“ Canadian Revolving Exposure ” shall mean, with respect to any Canadian Revolving Lender at any time, the aggregate principal amount at such time of all outstanding Canadian Revolving Loans of such Lender, plus the aggregate amount at such time of such Lender’s Canadian LC Exposure, plus the aggregate amount of such Lender’s Canadian Swingline Exposure.

“ Canadian Revolving Lender ” shall mean any Lender under the Canadian Subfacility. Each Canadian Revolving Lender (or any Affiliate or branch of any such Lender that is acting on behalf of such Lender) that is not resident in Canada or is deemed not to be resident in Canada for purposes of the ITA , shall be a financial institution that deals at arm’s length with the Canadian Borrowers for purposes of the ITA.

“ Canadian Revolving Loans ” shall mean advances made to or at the instructions of a Canadian Borrower, U.S. Borrower or U.K. Borrower, if any, pursuant to Section 2.01(ii) hereof under the Canadian Subfacility and may constitute Canadian Revolving Loans and Canadian Swingline Loans but shall not include Canadian FILO Loans, whether borrowed by any Canadian Borrower, any U.S. Borrower or any U.K. Borrower, if any.

“ Canadian Revolving Note ” shall mean each revolving note substantially in the form of Exhibit B-2 hereto.

 

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“ Canadian Security Agreement ” shall mean the Canadian Security Agreement dated as of the Closing Date, by and between the Collateral Agent and each of the Canadian Credit Parties substantially in the form set out in Exhibit E-2 and to the extent that a Canadian Credit Party has a place of business, registered office or tangible property in the province of Quebec, such term shall include each deed of hypothec and all related documents as may be applicable.

“ Canadian Subfacility ” shall have the meaning set forth in the recitals hereto.

“ Canadian Subsidiary ” shall mean any Subsidiary of the Company organized now or hereinafter under the laws of Canada or a province or territory thereof.

“ Canadian Subsidiary Guarantor ” shall mean (i)  each Canadian Wholly-Owned Subsidiary (other than the Canadian Borrowers) in existence on the Closing Date other than any Unrestricted Subsidiary, as well as Second Amendment Effective Date that is party to the Second Amendment and (ii)  each Canadian Subsidiary established, created or acquired after the Closing Second Amendment Effective Date which becomes a party to this Agreement in accordance with the requirements of this Agreement pursuant to Section 9.12 or otherwise.

“ Canadian Swingline Commitment ” shall mean the commitment of the Canadian Swingline Lender to make loans under the Canadian Subfacility pursuant to Section 2.12 , as the same may be reduced from time to time pursuant to Section 2.07 .

“ Canadian Swingline Exposure ” shall mean at any time the aggregate principal amount at such time of all outstanding Canadian Swingline Loans. The Canadian Swingline Exposure of any Canadian Revolving Lender at any time shall equal its Pro Rata Percentage of the aggregate Canadian Swingline Exposure at such time.

“ Canadian Swingline Lender ” shall mean Bank of America, N.A. (acting through its Canada branch).

“ Canadian Swingline Loan ” shall mean any Loan made by the Canadian Swingline Lender pursuant to Section 2.12 .

“ Canadian Swingline Note ” shall mean each swingline note substantially in the form of Exhibit B-4 hereto.

“ Capital Expenditures ” shall mean, with respect to any Person, all expenditures by such Person which should be capitalized in accordance with GAAP and, without duplication, the amount of the principal portion of all Capitalized Lease Obligations incurred by such Person.

“ Capital Lease ” shall have the meaning provided in the definition of the term “Capitalized Lease Obligations.”

“ Capitalized Lease Obligations ” of any Person shall mean , subject to Section 13. 07 hereof, the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof (each, a “ Capital Lease ”), which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP. For the purposes of this Agreement , and subject to the terms of Section 13.07, the amount of such obligations at any time shall be the capitalized amount thereof at such time, determined in accordance with GAAP.

 

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“ Cash Collateralize ” shall mean to pledge and deposit with or deliver to the Administrative Agent for deposit into the LC Collateral Account, for the benefit of the Administrative Agent, the Issuing Banks or the Swingline Lenders (as applicable) and the Lenders, cash as collateral for the LC Exposure, Obligations in respect of Swingline Loans, or obligations of Lenders to fund participations in respect of either thereof (as the context may require), in accordance with Section 2.13(j) . “ Cash Collateral ” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.

“ Cash Dominion Event ” shall mean the occurrence of a date when either (x) (a) Specified Availability shall have been less than the greater of (i) 10% of the Line Cap and (ii) $ 50,000,000, 45,000,000, in either case for 5 consecutive Business Days, until such date as (b) Specified Availability shall have been at least equal to the greater of (i) 10% of the Line Cap and (ii) $ 50,000,000 45,000,000 over a period of 30 consecutive calendar days or (y) a Specified Event of Default has occurred and is continuing.

“ Cash Dominion Notice ” shall mean a written notice delivered by the Administrative Agent at any time during a Cash Dominion Period to any bank or other depository at which any Deposit Account (other than any Excluded Account) is maintained directing such bank or other depository (a) to remit all funds in such Deposit Account to a Dominion Account, or in the case of a Dominion Account, to the Administrative Agent on a daily basis, and (b) to cease following directions or instructions given to such bank or other depository by any Credit Party regarding the disbursement of funds from such Deposit Account (other than any Excluded Account), and (c) to follow all directions and instructions given to such bank or other depository by the Administrative Agent in each case, pursuant to the terms of any Deposit Account Control Agreement in place.

“ Cash Dominion Period ” shall mean any period throughout which a Cash Dominion Event has occurred and is continuing.

“ Cash Equivalents ” shall mean:

(a) any evidence of Indebtedness, maturing not more than one year after the acquisition thereof, issued by the United States of America or Canada, or any instrumentality or agency thereof and guaranteed fully as to principal, interest and premium, if any, by the United States of America or Canada;

(b) any certificate of deposit, banker’s acceptance or time deposit (including Eurodollar time deposits), maturing not more than one year after the date of purchase, issued or guaranteed by or placed with (i) the Agent, any Lender or any bank providing Cash Management Services to the Company or any of its Subsidiaries or (ii , (ii) any Farm Credit Lender (as defined in the Farm Credit Agreement) under the Farm Credit Agreement, or (iii ) a commercial banking institution that has long-term debt rated “A2” or higher by Moody’s or “A” or higher by S&P and which has a combined capital and surplus of not less than $500,000,000;

(c) commercial paper (i) maturing not more than 270 days after the date of purchase and (ii) issued by a corporation (other than a Credit Party or any Affiliate of a Credit Party) with a rating, at the time as of which any determination thereof is to be made, of “P-1” or higher by Moody’s or “A-1” or higher by S&P (or equivalent rating in the case of Cash Equivalents held by a Foreign Subsidiary of the Company);

 

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(d) investments in fully collateralized repurchase agreements with a term of not more than 90 days for underlying securities of the types described in clause (a) above entered into with any bank or trust company meeting the qualifications specified in clause (b) above;

(e) demand deposits with any bank or trust company;

(f) money market funds substantially all the assets of which are comprised of securities of the types described in clauses (a) through (e) above; and

(g) in the case of the Foreign Subsidiaries of the Company, short-term investments comparable to the foregoing.

“ Cash Management Services ” shall mean any services provided from time to time to any Borrower or any of the Company’s Subsidiaries in connection with operating, collections, payroll, trust, or other depository or disbursement accounts, including automated clearinghouse, e-payable, electronic funds transfer, wire transfer, controlled disbursement, overdraft, depository, information reporting, lockbox and stop payment services.

“ CCAA Plan ” shall mean the plan to reorganize pursuant to the second amended and restated plan of reorganization and compromise of the Company and certain of its Subsidiaries dated November 1, 2010 which has been filed with the Canadian Bankruptcy Court and as may be further amended, supplemented or otherwise modified from time to time.

“ CDOR Rate” shall mean, for the relevant Interest Period, the arithmetic average of the Canadian Dollar bankers’ acceptance rate as published on the Reuters Screen CDOR page at or about 10:15 a.m., Toronto time, on the first day of the applicable Interest Period (or the preceding Business Day, if the applicable day is not a Business Day) for a term comparable to the Interest Period (or, if not available, such other commercially available source displaying Canadian interbank bid rates for Canadian Dollar bankers’ acceptances designated by the Administrative Agent in a manner consistent with market practice from time to time; provided that to the extent such market practice is not administratively feasible by the Administrative Agent, such designated rate shall be applied in a manner as otherwise reasonably determined by the Administrative Agent); provided, further, that in no event shall the CDOR Rate be less than zero.

“CDOR Rate Loan” shall mean a Canadian Revolving Loan or Canadian FILO Loan denominated in Canadian Dollars made by the Lenders to the Canadian Borrowers which bears interest at a rate based on the CDOR Rate.

“ CERCLA ” shall mean the Comprehensive Environmental Response, Compensation, and Liability Act of 1980, as the same has been amended and may hereafter be amended from time to time, 42 U.S.C. § 9601 et seq .

“ CFC ” shall mean a “controlled foreign corporation” within the meaning of Section 957 of the Code.

“Change in Law” shall mean the occurrence after the Second Amendment Effective Date or, with respect to any Lender, such later date on which such Lender becomes a party to this Agreement, of (a) the adoption of or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the interpretation or application thereof by any Governmental Authority or (c) compliance by any Lender (or, for purposes of Section 3.01, by any lending office of such Lender or by such Lender’s holding company, if any) with any request, guideline or directive (whether or not having

 

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the force of law) of any Governmental Authority made or issued after such applicable date; provided that, notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III , shall be deemed to be a “Change in Law,” regardless of the date enacted, adopted or issued.

“ Change of Control ” shall mean the occurrence of any of the following:

(1) the direct or indirect sale, lease, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the properties or assets of the Company and its Subsidiaries taken as a whole to any “person” (as that term is used in Section 13(d)(3) of the Exchange Act);

(2) the adoption of a plan relating to the liquidation or dissolution of the Company (other than a plan of liquidation of the Company that is a liquidation for tax purposes only);

(3) the consummation of any transaction (including, without limitation, any merger or consolidation), the result of which is that any “person” (as defined above) becomes the beneficial owner, directly or indirectly, of more than 50% of the voting stock of the Company, measured by voting power rather than number of shares;

(4) the Company consolidates with, or merges with or into, any Person, or any Person consolidates with, or merges with or into, the Company, in any such event pursuant to a transaction in which any of the outstanding voting stock of the Company or such other Person is converted into or exchanged for cash, securities or other property, other than any such transaction where the voting stock of the Company outstanding immediately prior to such transaction constitutes or is converted into or exchanged for a majority of the outstanding shares of the voting stock of such surviving or transferee Person (immediately after giving effect to such transaction); or

(5) any event constituting a “change of control” under the Senior Notes Indenture or any other instruments governing any Indebtedness in excess of the Threshold Amount.

Notwithstanding the foregoing: (A) any holding company whose only significant asset is Equity Interests of the Company or any of its direct or indirect parent companies shall not itself be considered a “person” or “group” for purposes of clause (2) above; (B) the transfer of assets between or among the Company and its Restricted Subsidiaries shall not itself constitute a Change of Control; (C) the term “Change of Control” shall not include a merger or consolidation of the Company with, or the sale, assignment, conveyance, transfer, lease or other disposition of all or substantially all of the Company’s assets to, an Affiliate incorporated or organized solely for the purpose of reincorporating or reorganizing the Company in another jurisdiction and/or for the sole purpose of forming or collapsing a holding company structure; (D) a “person” or “group” shall not be deemed to have beneficial ownership of securities subject to a stock purchase agreement, merger agreement or similar agreement (or voting or option agreement related thereto) until the consummation of the transactions contemplated by such agreement; and (E) a transaction in which the Company or any direct or indirect parent of the Company becomes a Subsidiary of another Person (other than a Person that is an individual, such Person that is not an individual, the “ New Parent ”) shall not constitute a Change of Control if (a) the shareholders of the Company or such parent immediately prior to such transaction “beneficially own” (as such term is defined in Rule 13d-3 and Rule 13d-5 under the Exchange Act), directly or indirectly through one or

 

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more intermediaries, at least a majority of the voting power of the outstanding voting stock of such parent immediately following the consummation of such transaction or (b) immediately following the consummation of such transaction, no “person” (as such term is defined above), other than the New Parent, “beneficially owns” (as such term is defined above), directly or indirectly through one or more intermediaries, more than 50% of the voting power of the outstanding voting stock of the Company or the New Parent.

“ Chattel Paper ” shall have the meaning provided in Article 9 of the UCC.

“ Class , ” (a) when used with respect to Lenders, shall refer to whether such Lender has a Loan, Protective Advances or Commitment with respect to the U.S. Subfacility, the Canadian Subfacility, a the U.S. FILO Subfacility or a the Canadian FILO Subfacility, (b) when used with respect to Commitments, refers to whether such Commitments are U.S. Revolving Commitments, Canadian Revolving Commitments, U.S. FILO Commitments or Canadian FILO Commitments and (c) when used with respect to Loans or a Borrowing, refers to whether such Loans, or the Loans comprising such Borrowing, are Loans under the U.S. Subfacility, Loans under the Canadian Subfacility, Loans under the U.S. FILO Subfacility, Loans under the Canadian FILO Subfacility or Protective Advances under the U.S. Subfacility or the Canadian Subfacility.

“ Closing Date ” shall mean May 22, 2015.

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

“ Co-Documentation Agent ” shall mean Merrill Lynch, Pierce, Fenner & Smith Incorporated, BMO Capital Markets Corp. , Barclays Bank PLC and Wells Fargo TD Bank, N.A. and Canadian Imperial Bank of Commerce , in their respective capacities as co-documentation agents, as applicable, under this Agreement.

“Co-Syndication Agent” shall mean BMO Capital Markets Corp. and Wells Fargo Bank, N.A., in their respective capacities as co-syndication agents, as applicable, under this Agreement.

“ Collateral ” shall mean, collectively, the Canadian Collateral, the U.S. Collateral and the U.K. Collateral.

“ Collateral Access Agreement ” shall mean any landlord waiver or other agreement, in form and substance reasonably satisfactory to the Collateral Agent, between the Collateral Agent and any third party (including any bailee, consignee, customs broker or other similar Person) in possession of any Collateral or any landlord mortgagee of any Credit Party for any real property where any Collateral is located, as such landlord waiver or other agreement may be amended, restated or otherwise modified from time to time.

“ Collateral Agent ” shall have the meaning set forth in the recitals hereto.

“ Collateral Requirement ” shall have the meaning assigned that term in Section 10.01(vi) .

“ Collection Accounts ” shall mean, collectively, the U.S. Collection Accounts, the Canadian Collection Accounts and the English Collection Accounts.

“ Commingled Inventory ” shall mean Inventory of any U.S. Borrower Credit Party , Canadian Credit Party or English Credit Party that is commingled (whether pursuant to a consignment (as defined in Section 9-102 of the UCC), a toll manufacturing agreement or otherwise) with Inventory of another Person (other than another applicable Credit Party) at a location owned or leased by an applicable Credit Party to the extent that such Inventory of such Credit Party is not readily identifiable.

 

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“ Commitment ” shall mean, with respect to any Lender, such Lender’s Revolving Commitment, LC Commitment or Swingline Commitment, or any Extended Revolving Loan Commitment.

“ 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.

“ Company ” shall have the meaning provided in the preamble hereto.

“ Compliance Certificate ” shall mean a certificate of the Responsible Officer of the Company substantially in the form of Exhibit G hereto, and in any case, in form and substance reasonably satisfactory to the Administrative Agent.

“ Concentration Limit ” for any Account Debtor shall mean at any time an amount equal to (a) the aggregate Outstanding Balance of Eligible Accounts included in the Borrowing Base, after giving effect to the limits on concentration specified in the definition of Eligible Accounts (on an iterative basis), multiplied by (b) the applicable percentage set forth below:

(i) if and so long as such Account Debtor has Debt Ratings of at least BBB- by S&P and Baa3 by Moody’s, 15.0%;

(ii) if and so long as such Account Debtor has Debt Ratings from S&P or Moody’s and the preceding clause (i) is not applicable, 10.0%; or

(iii) if neither of the preceding clauses is applicable, 5.0%.

If the Debt Rating of any Account Debtor is downgraded such that the Concentration Limit for such Account Debtor would be reduced, such reduction in such Concentration Limit shall not occur until three Business Days after the Company becomes aware of such downgrade.

“ Consolidated EBITDA ” shall mean, for any period, Consolidated Net Income for such period, plus :

(a) without duplication and to the extent deducted in determining such Consolidated Net Income, the sum of:

(i) Consolidated Interest Expense for such period;

(ii) provision for taxes based on income, profits or losses (determined on a consolidated basis) during such period;

(iii) all amounts attributable to depreciation, depletion and amortization for such period, including, but not limited to, any acceleration thereof;

(iv) any extraordinary losses for such period;

(v) any Non-Cash Charges for such period;

 

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(vi) non-recurring charges and/or restructuring charges for such period relating to current or anticipated future cash expenditures, including closure costs, impairment and other related charges in connection with asset closures, optimization initiatives or consolidation of assets, in an aggregate amount not to exceed in any Test Period 20% of Consolidated EBITDA for such Test Period (prior to giving effect to this clause (vi)); and

(vii) deferred financing fees (and any write-offs thereof);

provided that, to the extent not reflected in Consolidated Net Income for the period in which such cash payment is made, any cash payment made with respect to any Non-Cash Charges added back in computing Consolidated EBITDA for any prior period pursuant to clause (v) above (or that would have been added back had this Agreement been in effect during such prior period) shall be subtracted in computing Consolidated EBITDA for the period in which such cash payment is made; and minus

(b) without duplication and to the extent included in determining such Consolidated Net Income:

(i) any extraordinary gains for such period; and

(ii) any non-cash gains for such period (excluding any non-cash gain to the extent it represents the reversal of an accrual or reserve for a potential cash item that reduced Consolidated EBITDA in any prior period);

in each case of clauses (a) and (b), determined on a consolidated basis in accordance with GAAP; provided , further , that Consolidated EBITDA for any period shall be calculated so as to exclude (without duplication of any adjustment referred to above) the effect of:

(A) the cumulative effect of any changes in GAAP or accounting principles applied by management;

(B) any gain or loss for such period that represents after-tax gains or losses attributable to any sale, transfer or other disposition or abandonment of assets by the Company or any of the Restricted Subsidiaries, other than dispositions or sales of inventory and other dispositions in the ordinary course of business;

(C) any income or loss for such period attributable to the early extinguishment of Indebtedness or accounts payable;

(D) any non-cash gains or losses on foreign currency derivatives and any foreign currency transaction non-cash gains or losses and any foreign currency exchange translation gains or losses that arise on consolidation of integrated operations; and

(E) mark-to-market adjustments in the valuation of derivative obligations resulting from the application of Statement of Financial Accounting Standards No. 133, Accounting for Derivative Instruments and Hedging Activities .

“ Consolidated Fixed Charge Coverage Ratio ” shall mean, for any period, the ratio of (a) Consolidated EBITDA for such period minus the sum of (A) the aggregate amount of all Capital Expenditures made by the Company and its Restricted Subsidiaries during such period (other than (x) Capital Expenditures to the extent financed with equity net cash proceeds, asset sale net cash proceeds, condemnation net cash proceeds, insurance net cash proceeds or Indebtedness but including Capital

 

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Expenditures to the extent financed with proceeds of Loans and (y) the aggregate amount of Growth Capital Expenditures made with cash on the balance sheet by the Company and its Restricted Subsidiaries solely up to the lesser of (x) $250,000,000 in the aggregate and (y) the total amount of unrestricted cash on hand at the Company as of the Closing Date; provided that (i) the Company provides the Administrative Agent promptly after the end of each fiscal quarter with a report of the Capital Expenditures made with such unrestricted cash from the balance sheet for such fiscal quarter , and (ii) such Growth Capital Expenditures shall only be excluded to the extent there are no outstanding Borrowings of Revolving Loans or FILO Loans at the time of calculation of the Consolidated Fixed Charge Coverage Ratio) plus (B) the amount of all cash payments during such period made by Company and its Restricted Subsidiaries in respect of income taxes (net of cash income tax refunds during such period) (excluding such cash payments related to asset sales not in the ordinary course of business) to (b) Consolidated Fixed Charges for such period.

“ Consolidated Fixed Charges ” shall mean, for any period, the sum of (a) cash Consolidated Interest Expense of the Company and its Restricted Subsidiaries for such period plus (b) the scheduled principal payments made during such period on all Indebtedness for borrowed money and Capital Leases of the Company and its Restricted Subsidiaries for such period plus (c) the aggregate amount of all regularly scheduled Restricted Payments paid in cash by the Company with respect to its Equity Interests during such period; plus (d) (i) actual cash pension funding payments made by the Company and its Restricted Subsidiaries with respect to pension funding obligations for such period, minus (ii) the profit and loss statement charge (or benefit) with respect to such pension funding obligations for such period; provided that in no event shall actual voluntary cash pension funding payments made by the Company and its Restricted Subsidiaries with respect to pension funding obligations for such period be included.

“ Consolidated Interest Expense ” shall mean, for any period, the interest expense (other than for the purposes of Consolidated Fixed Charges, net of interest income on Cash Equivalents) of the Company and its Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP. For purposes of the foregoing, interest expense shall be determined after giving effect to any net payments made or received by the Company and its Restricted Subsidiaries with respect to Hedging Agreements, but excluding any gain or loss recognized under GAAP that results from the mark-to-market valuation of any Hedging Agreement.

“ Consolidated Net Income ” shall mean, for any period, the net income (or loss) of the Company and its Restricted Subsidiaries on a consolidated basis for such period taken as a single accounting period determined in conformity with GAAP; provided that there shall be excluded from such calculation (a) the income (or loss) of any Restricted Subsidiary of the Company that is not wholly owned by the Company to the extent such income (or loss) is attributable to the noncontrolling interest in such Restricted Subsidiary, and (b) the income (or loss) of any Person accrued prior to the date it becomes (or, for pro forma purposes, is deemed to have become) a Restricted Subsidiary of the Company or is merged into or consolidated with the Company or any of its Restricted Subsidiaries or the date that Person’s assets are acquired by the Company or any of its Restricted Subsidiaries.

“ Consolidated Total Assets ” shall mean, as of any date of determination, the amount that would, in conformity with GAAP, be set forth opposite the caption “total assets” (or any like caption) on a consolidated balance sheet of the Company and the its Restricted Subsidiaries at such date as of the most recent fiscal quarter end for which financial statements have been delivered .

“ Consolidated Total Debt ” shall mean, at any time, the Indebtedness of the Company or any of its Restricted Subsidiaries included on the consolidated balance sheet of the Company and its Restricted Subsidiaries at such time as of the most recent fiscal quarter end for which financial statements have been delivered .

 

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“ Contingent Obligation ” shall mean, as to any Person, any obligation of such Person as a result of such Person being a general partner of any other Person, unless the underlying obligation is expressly made non-recourse as to such general partner, and any obligation of such Person guaranteeing or intended to guarantee any Indebtedness (“ primary obligations ”) of any other Person (the “ primary obligor ”) in any manner, whether directly or indirectly, including, without limitation, any such obligation of such Person, whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds (x) for the purchase or payment of any such primary obligation or (y) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the holder of such primary obligation against loss in respect thereof; provided , however , that the term Contingent Obligation shall not include endorsements of instruments for deposit or collection in the ordinary course of business. The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Contingent Obligation is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as determined by such Person in good faith.

“ Contract Period ” shall mean the term of any B/A Equivalent Loan which shall be of one, two, three or six months, as selected by the applicable Canadian Borrower in accordance with Section 2.03 or Section 2.08 , (i) initially, commencing on the date of such B/A Equivalent Loan and (ii) thereafter, commencing on the day on which the immediately preceding Contract Period expires; provided that (a) if a Contract Period would otherwise expire on a day that is not a Business Day, such Contract Period shall expire on the next succeeding Business Day unless no further Business Day occurs in such month, in which case such Contract Period shall expire on the immediately preceding Business Day; (b) any Contract 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 Contract Period) shall, subject to clause (c) of this definition, end on the last Business Day of a calendar month; and (c) no Contract Period with respect to any portion of a B/A Equivalent Loan shall extend beyond the Maturity Date.

“ Core Canadian Concentration Account ” shall have the meaning provided in Section 9.17(c)(iii) .

“ Core Concentration Accounts ” shall mean, collectively, the Core U.S. Concentration Accounts and the Core Canadian Concentration Accounts.

“ Core U.S. Concentration Account ” shall have the meaning provided in Section 9.17(c)(iii) .

“ Country Concentration Limit ” shall mean at any time, for any Approved Country other than the United States or Canada, an amount equal to (a) the aggregate Outstanding Balance of Eligible Accounts included in the Borrowing Base, after giving effect to the limits on concentration specified in the definition of Eligible Accounts (on an iterative basis), multiplied by (b) the applicable percentage set forth below:

(i) if such Approved Country has Foreign Currency Long-Term Debt Ratings of BBB- or better from S&P and Ba1 or better from Moody’s, 15%; or

(ii) otherwise, 10%;

provided that the Collateral Agent may, in its Permitted Discretion and at any time, on account of bona fide credit reasons, reduce (to a lesser amount or to zero) any Country Concentration Limit, but such reduction shall not become effective until three Business Days after written notice of such reduction is received by the Company .

 

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“ Credit Documents ” shall mean this Agreement and, after the execution and delivery thereof pursuant to the terms of this Agreement, each Note, each Security Document, any intercreditor agreement contemplated by this Agreement, any collateral cooperation agreement contemplated by Section 10.01(vi) and each Incremental Revolving Commitment Agreement.

“ Credit Event ” shall mean the making of any Loan.

“ Credit Extension ” shall mean, as the context may require, (i) a Credit Event or (ii) an LC Credit Extension; provided that “Credit Extensions” shall not include conversions and continuations of outstanding Loans.

“ Credit Parties ” shall mean the U.S. Credit Parties, the Canadian Credit Parties and the English Credit Parties.

“ Credit Party Guaranty ” shall mean the guaranty of each Credit Party pursuant to Section 14 .

“ Debt Rating ” for any Person, shall mean the public rating by S&P of such Person’s long term non-credit enhanced, senior unsecured debt, or the corporate family rating assigned to such Person by Moody’s.

“Debtor Relief Laws” shall mean the Bankruptcy Code, and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the United States, Canada or other applicable jurisdictions from time to time in effect, including any proceeding under corporate law or other law of any jurisdiction whereby a corporation seeks a stay or a compromise of the claims of its creditors against it and each of the Bankruptcy and Insolvency Act (Canada) , the Companies’ Creditors Arrangement Act (Canada) and the Winding-Up and Restructuring Act (Canada) .

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

“ Default Rate ” shall have the meaning assigned to such term in Section 2.06(f) .

“ Defaulting Lender ” shall mean , any Lender that (a) has failed to comply with its funding obligations hereunder, and such failure is not cured (i) fund all or any portion of its Loans within two Business Days of the date such Loans were required to be funded hereunder unless such Lender notifies the Administrative Agent and the Company in writing that such failure is the result of such Lender’s reasonable determination in good faith that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Administrative Agent, any Issuing Bank, any Swingline Lender or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swingline Loans) within two Business Days ; (b) has notified the Administrative Agent or any Borrower of the date when due, (b) has notified the Company or the Administrative Agent in writing that such Lender it does not intend to comply with its funding obligations hereunder or under any other credit facility , or has made a public statement to that effect ; (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s reasonable determination in good faith that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable

 

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default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days following after written request by the Administrative Agent or any Borrower the Company , to confirm in a manner satisfactory writing to the Administrative Agent and Borrowers the Company that such Lender it will comply with its prospective funding obligations hereunder ; (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Company), or (d) has, or has a direct or indirect parent company that has, other than via an Undisclosed Administration, (i)  become the subject of an insolvency proceeding (including reorganization, liquidation, or appointment of (A) a proceeding under any Debtor Relief Law or (B) a Bail-In Action, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator , assignee for the benefit of creditors or similar Person by charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority ) acting in such a capacity ; provided , however , that a Lender shall not be a Defaulting Lender solely by virtue of a Governmental Authority’s the ownership of an equity interest in such or acquisition of any Equity Interest in that Lender or any direct or indirect parent company unless the ownership provides immunity for thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets , or permits permit such Lender ( or such Governmental Authority to repudiate or otherwise to reject such Lender’s agreements. ) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender. Any determination by the Administrative Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above, and of the effective date of such status, shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender as of the date established therefor by the Administrative Agent in a written notice of such determination, which shall be delivered by the Administrative Agent to the Company and each other Lender promptly following such determination.

“ Deposit Account ” shall have the meaning assigned thereto in Article 9 of the UCC.

“ Deposit Account Control Agreement ” shall mean a Deposit Account control agreement to be executed by each institution maintaining a Deposit Account (other than an Excluded Account) for a Borrower or any other Credit Party, in each case as required by and in accordance with the terms of Section 9.17 and in form and substance reasonably satisfactory to the Collateral Agent or, in the case of any Deposit Account which is the subject of security created under any U.K. Security Document, a notice sent pursuant to the terms of the relevant U.K. Security Document by the Credit Party in whose name such account is held to the depositary bank, the securities intermediary, future intermediary or commodity intermediary, as the case may be, with which such account is maintained and duly acknowledged by the addressee of such notice.

“ Designated Non-Cash Consideration ” shall mean the fair market value of non-cash consideration received by the Company or one of the Restricted Subsidiaries in connection with a sale of assets that is so designated as Designated Non-Cash Consideration pursuant to an officers’ certificate, setting forth the basis of such valuation, less the amount of cash and Cash Equivalents received in connection with a subsequent sale of such Designated Non-Cash Consideration.

“ Dilution Factors ” shall mean, without duplication, with respect to any period, the aggregate amount of all bad debt write-downs, discounts, credits, returns, rebates, and other dilutive items.

“ Dilution Ratio ” shall mean, at any date, as to the Accounts owned by any Person, the amount (expressed as a percentage) that is the result of dividing the U.S.  Dollar aggregate amount (for this purpose, using the U.S.  Dollar Equivalent of amounts not denominated in U.S. Dollars) of (a) the applicable Dilution Factors for the twelve most recently ended fiscal months with respect to such Person’s Accounts, by (b) such Person’s total gross sales with respect to their Accounts for the twelve most recently ended fiscal months.

 

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“ Dilution Reserve ” shall mean, in the case of the Canadian Borrowing Base, the Canadian Dilution Reserve, and in the case of the U.S. Borrowing Base, the U.S. Dilution Reserve.

“ Disqualified Equity Interests ” shall mean that portion of any Equity Interest which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, matures or is mandatorily redeemable (other than redeemable only for Equity Interests of such Person that are not Disqualified Equity Interests), pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, on or prior to the date that is six months after the Maturity Date , ; provided , however , that any Equity Interest that would not constitute a Disqualified Equity Interest but for provisions thereof giving holders thereof the right to require such Person to purchase or redeem such Equity Interest upon the occurrence of a “change of control” shall not constitute a Disqualified Equity Interest if:

(1) the “change of control” provisions applicable to such Equity Interest are not more favorable to the holders of such Equity Interest than the terms applicable to the Loans; and

(2) any such requirement only becomes operative after compliance with such terms applicable to the Loans.

“Division” means the division of the assets, liabilities or obligations of a Person (the “Dividing Person”) among two or more Persons (whether pursuant to a “plan of division” or similar arrangement), which may or may not include the Dividing Person and pursuant to which the Dividing Person may or may not survive.

“ Dodd-Frank and Basel III ” shall have the meaning set forth in Section 3.01(d) .

“ Dollar Equivalent ” shall mean, at any time, (a) with respect to any amount denominated in Dollars, such amount, and (b) with respect to any amount denominated in Canadian Dollars, the equivalent amount thereof in Dollars as determined by the Administrative Agent or the applicable Issuing Bank, as the case may be, at such time on the basis of the Spot Rate (determined in respect of the most recent Revaluation Date) for the purchase of Dollars with Canadian Dollars.

“Dollars” and the sign “$” shall each mean freely transferable lawful money (expressed in dollars) of the United States.

“ Domestic Subsidiary ” shall mean any Subsidiary organized under the laws of the United States, any state thereof or the District of Columbia.

“ Dominion Account ” shall have the meaning given to such term in Section 9.17(c) .

“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.

 

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“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.

“ Effective Yield ” shall mean, as to any Revolving Loans, the effective yield on such Revolving Loans as determined by the Administrative Agent, taking into account the applicable interest rate margins, any interest rate floors or similar devices and all fees, including upfront or similar fees or original issue discount (amortized over the shorter of (x) the Weighted Average Life to Maturity of such Loans and (y) the four years following the date of incurrence thereof) payable generally to Lenders making such Loans, but excluding any arrangement, underwriting, structuring or other fees payable in connection therewith that are not generally shared with the relevant Lenders and customary consent fees paid generally to consenting Lenders.

“ Eligible Account ” shall mean, at any time, an Account created by a U.S. Borrower Credit Party , Canadian Credit Party or English Credit Party in the ordinary course of its business, that arise arises out of its sale of goods (other than promotional products not held for sale) or rendition of services:

(a) which is subject to a first priority perfected Lien (or, in the case of the Eligible English Accounts, the English Security Agreement) in favor of the Collateral Agent for the benefit of the Secured Creditors pursuant to the relevant Security Documents;

(b) which is not subject to any Lien other than (i) a Lien in favor of the Collateral Agent for the benefit of the Secured Creditors pursuant to the relevant Security Documents, (ii) a Lien (if any) permitted by Section 10.01 which is junior in priority to the Lien in favor of the Collateral Agent for the benefit of the Secured Creditors pursuant to the relevant Security Documents, and (iii) an unregistered Lien in respect of Canadian Priority Payables that are not yet due and payable;

(c) which (i) arises from the sale of goods or performance of services in the ordinary course of business, (ii) is evidenced by an invoice or other documentation reasonably satisfactory to the Collateral Agent which has been sent to the Account Debtor (which may include electronic transmission) and (iii) does not represent a progress billing, a sale on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment, cash-on-delivery or any other repurchase or return basis;

(d) the Account Debtor of which is an Eligible Account Debtor and is not an Affiliate of any Credit Party; provided that if such Account Debtor does not have a billing address in the United States or Canada, such Account must also qualify as an Eligible Insured and Letter of Credit Backed Account; provided , further , for the avoidance of doubt, Tradepak Internacional S.A. de C.V. does not constitute an Affiliate of the Credit Parties as of the Closing Date, and shall not constitute an Affiliate unless any additional equity interests of such entity are acquired by a Credit Party);

(e) except with respect to Qualified Power Accounts, that is not owing from an Account Debtor that is an agency, department or instrumentality of the United States, any state thereof, of the federal government of Canada, or any province, territory or subdivision thereof or that is an agency, department or instrumentality of any country other than the United States or Canada or any state, territory, province or other political subdivision of a country other than the

 

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United States or Canada unless the applicable U.S. Borrower Credit Party or Canadian Credit Party shall have satisfied the requirements of the Assignment of Claims Act of 1940 in the case of Accounts owing from any agency, department or instrumentality of the United States, the Financial Administration Act (Canada) in the case of Accounts owing from an agency, department or instrumentality of the federal government of Canada or any province, territory or subdivision thereof, and any similar state, federal or provincial legislation or any similar foreign legislation and the Administrative Agent is satisfied as to the absence of setoffs, counterclaims and other defenses on the part of such Account Debtor;

(f) that is not subject to any late payment for longer than 90 days (or 60 in the case of an International Account) from the original due date for such payment;

(g) that is not the obligation of an Account Debtor (other than an individual) of which 50% or more of the dollar amount of all Accounts owing by such Account Debtor are ineligible under the criteria set forth in clause (f) above;

(h) which has been billed and, according to the Contract related thereto, is required to be paid in full within 90 days; provided that such period may be extended to (1) solely in the case of Accounts that are not International Accounts, 120 days of the original billing date therefor, if so agreed by the Collateral Agent in its Permitted Discretion, or (2) if such Account is an International Account, 180 days of the original billing date (such Accounts in clauses (1) and (2) collectively, “ Long Dated Accounts ”), so long as such Long Dated Accounts are covered by the Insurance Policy and the “maximum payment terms” with respect to such Long Dated Account set forth in the Insurance Policy specifically permits such payment terms; provided , further , that (A) Long Dated Accounts that are Eligible Canadian/English Accounts shall not account for more than 25% of the aggregate Outstanding Balance of all Eligible Canadian/English Accounts and (B) Long Dated Accounts that are Eligible U.S. Accounts shall not account for more than 25% of the aggregate Outstanding Balance of all Eligible U.S. Accounts;

(i) which is not subject to any deduction, offset, counterclaim, defense or dispute (other than (i) sales discounts given in the ordinary course of the applicable Credit Party’s business and reflected in the amount of such Account as set forth in the invoice or other supporting material therefor or (ii) an offset or counterclaim of a nature specifically addressed in the determination of the applicable Borrowing Base); provided , however , that if an Account satisfies all of the requirements of an Eligible Account other than this clause (i), such Account shall be an Eligible Account, but only to the extent the amount of such Account exceeds such deduction, offset, counterclaim, defense or dispute or other conditions;

(j) which is denominated and payable only in Dollars, Canadian Dollars, Euros or Pounds Sterling;

(k) which represents a bona fide, legal, valid and binding obligation of the Account Debtor of such Account to pay the stated amount, as to which the applicable Credit Party has satisfied and fully performed all obligations with respect to such Account required to be fulfilled by it as a condition to payment thereon by the applicable Account Debtor;

(l) which, together with the contract related thereto, does not contravene in any material respect any laws, rules or regulations applicable thereto (including, without limitation, laws, rules and regulations relating to usury, consumer protection, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy) in a manner that would affect the enforceability of such Account and with respect to which none of the Credit Parties or the Account Debtor is in violation of any such law, rule or regulation in any material respect in a manner that would affect the enforceability of such Account;

 

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(m) which arises under a contract which does not contain a legally enforceable provision requiring the Account Debtor thereunder to consent to the creation of a lien thereon (unless a written consent of such Account Debtor has been obtained) or that otherwise restricts in a legally enforceable manner the ability of the Administrative Agent, Collateral Agent or Lenders to exercise their rights under the Credit Documents, including, without limitation, their right to review the related invoice or the payment terms of such contract;

(n) in the case of an Account originated by a Canadian Credit Party, the Account Debtor of which has a billing address in Canada, (i) which was not issued for an amount in excess of the fair market value of the merchandise, insurance or services provided by the Canadian Credit Party to which the Account relates and (ii) as to which no Contract or any other books, records or other information relating to such Account contain any “personal information” as defined in, or any other information regulated under , (x) the Personal Information Protection and Electronic Documents Act (Canada) , or (y) any other similar statutes of Canada or any province or territory thereof in force from time to time which restrict, control, regulate or otherwise govern the collection, holding, use or communication of information;

(o) which, when aggregated with all other Accounts of the same Account Debtor, is not in excess of such Account Debtor’s Concentration Limit (but the portion of the Accounts not in excess of such Concentration Limit shall not be deemed ineligible due to this clause (o));

(p) which, when aggregated with in the case of an Account of an Account Debtor with a billing address in any Approved Country other than Canada, the United States, the U.K., the Netherlands or Northern Ireland (other than an Eligible Insured and Letter of Credit Backed Account, which shall not be deemed ineligible due to this clause (p) or count towards the sublimit for Eligible Accounts contained in this clause (p)), the aggregate amount of such Account, together with the amount of all other Accounts of Account Debtors with a billing address in any Approved Country other than Canada or the United States, is not in excess of the Country Concentration Limit for such Approved Country , the United States, the U.K., the Netherlands or Northern Ireland (other than an Eligible Insured and Letter of Credit Backed Account, which shall not be deemed ineligible due to this clause (p) or count towards the sublimit for Eligible Accounts contained in this clause (p)), is not in excess of 7.5% of the Revolving Commitments at such time (but the portion of the Accounts not in excess of such Country Concentration Limit limit shall not be deemed ineligible due to this clause (p));

(q) in relation to which, if the security interest in such Account has been granted pursuant to the U.K. Security Documents, the English Credit Parties have informed the relevant Account Debtor in writing that it has assigned by way of security to the Collateral Agent certain rights in respect of its assets, including those represented by the Eligible Accounts, and has requested such Account Debtor to acknowledge receipt of such notice;

(r) which Accounts are not subject to, or included or expected to be included, as part of an accounts receivable factoring program or supply chain financing program, other than Qualified Factored Accounts;

 

 

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(s) (i) the Account Debtor obligated upon such Account has not suspended business , or made a general assignment for the benefit of creditors or has failed to pay its debts generally as they come due , and (ii) no petition is filed by or against the Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors Debtor Relief Law ; provided , however , that if an Approved DIP Account satisfies all of the requirements of an Eligible Account other than this clause (s), such Account shall be an Eligible Account;

(t) in the case of an Account originated by an English Credit Party, the Account Debtor of which has a place of establishment in the U.K. as to which no Contract or any other books, records or other information relating to such Account contain any “personal data” as defined in, or any other information regulated under (x) the Data Protection Act 1998, 1998 or (y) any other similar statutes of the U.K. in force from time to time which restrict, control, regulate or otherwise govern the collection, holding, use or communication of information, unless the Account Debtor has consented to the disclosure of such data for the purpose of the English Credit Party obtaining finance in relation to the relevant Account; and

(u) which is not otherwise unacceptable to the Collateral Agent in its Permitted Discretion.

Accounts acquired by a Borrower, Canadian Credit Party or English Credit Party after the Closing Date (other than from another Borrower, Canadian Credit Party or English Credit Party) that have a fair market value of $30,000,000 or more in the aggregate, shall not be deemed Eligible Accounts until the completion of an appraisal and field examination of such Accounts, in each case, reasonably satisfactory to the Collateral Agent.

“ Eligible Account Debtor ” shall mean an Account Debtor which:

(i) has a billing address in an Approved Country (it being understood that clause (i)(y) of proviso to the definition thereof shall not apply under this clause (i) to any Account which otherwise constitutes an Eligible Insured and Letter of Credit Backed Account);

(ii) is not a Person with respect to which the United States, Canada or any other Approved Country shall have imposed sanctions;

(iii) is not in violation of any Anti-Terrorism Laws or AML Legislation;

(iv) is not a Person (A) that is listed in the annex to, or otherwise subject to the provisions of, the Executive Order, (B) that is owned or controlled by, or acting for or on behalf of, any Person that is listed in the annex to, or is otherwise subject to the provisions of, the Executive Order, (C) with which a Lender or a Credit Party is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law or AML Legislation, (D) that commits, threatens or conspires to commit or supports “terrorism” as defined in the Executive Order, or (E) that is named as a “specifically designated national and blocked person” on the most current list published by the U.S. Treasury Department Office of Foreign Assets Control at its official website or any replacement website or other replacement official publication of such list or any similar lists published in Canada or any country within the European Area; and

(v) is not a Person (A) whose property or interest in property is otherwise blocked or subject to blocking pursuant to Section 1 of the Executive Order or any other Anti-Terrorism Law, or (B) that engages in any dealings or transactions prohibited by Section 2 of the Executive Order or any other Anti-Terrorism Law or AML Legislation, or is otherwise associated with any such Person in any manner violative of such Section 2 or any other Anti-Terrorism Law or AML Legislation.

 

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“ Eligible Assignee ” shall mean a Person that is (a) a Lender, Affiliate of a Lender or Approved Fund; (b) an assignee approved by the Company (which approval shall not be unreasonably withheld or delayed, and shall be deemed given if no objection is made within ten days after notice of the proposed assignment), the Administrative Agent, the applicable Swingline Lender and the applicable Issuing Bank; or (c) during an Event of Default under Section 11.01 or 11.05 , any Person acceptable to the Administrative Agent, the applicable Swingline Lender and the applicable Issuing Bank in their discretion; provided that no Person who is not dealing at arm’s length for the purposes of the Income Tax Act (Canada) with a Canadian Credit Party or is a “specified shareholder” as such term is defined in subsection 18(5) of the Income Tax Act (Canada) or does not deal at arm’s length with such a “specified shareholder” (as defined in the Income Tax Act (Canada)) shall be an Eligible Assignee.

“ Eligible Canadian Accounts ” shall mean the Eligible Accounts owned by the Canadian Credit Parties.

“ Eligible Canadian/English Accounts ” shall mean Eligible Canadian Accounts and Eligible English Accounts.

“ Eligible Canadian Inventory ” shall mean the Eligible Inventory owned by the Canadian Credit Parties.

“ Eligible Canadian/English Inventory ” shall mean Eligible Canadian Inventory and Eligible English Inventory.

“ Eligible English Accounts ” shall mean the Eligible Accounts owned by the English Credit Parties.

“ Eligible English Inventory ” shall mean the Eligible Inventory owned by the English Credit Parties.

“ Eligible Insured and Letter of Credit Backed Account ” shall mean an Account created by a Credit Party in the ordinary course of its business , which is either (i) fully insured (to the extent provided for therein) by the Insurance Policy or (ii) secured by a letter of credit acceptable to the Collateral Agent which, upon the request of the Collateral Agent during a Cash Dominion Period, has been assigned to the Collateral Agent in a manner satisfactory to the Collateral Agent, and otherwise qualified as an “Eligible Account” hereunder (excluding the effect of clause (p) of the definition thereof) .

“ Eligible Inventory ” shall mean, at any time, the Inventory of the Credit Parties, but excluding any Inventory:

(a) which is not subject to a first priority perfected Lien (or, in the case of the Eligible English Inventory, the English Security Agreement) in favor of the Collateral Agent for the benefit of the Secured Creditors pursuant to the relevant Security Documents;

(b) which is subject to any Lien other than (i) a Lien in favor of the Collateral Agent for the benefit of the Secured Creditors pursuant to the relevant Security Documents, (ii) a Lien (if any) permitted by Section 10.01 which is junior in priority to the Lien in favor of the Collateral Agent for the benefit of the Secured Creditors pursuant to the relevant Security Documents (unless as to any particular Lien, the Collateral Agent has established a Reserve in lieu of obtaining an agreement subordinating such Lien of the Collateral Agent), and (iii) an unregistered Lien in respect of Canadian Priority Payables that are not yet due and payable;

 

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(c) which is determined, based on the applicable Credit Parties’ historical practices and procedures, in each case, which are reasonably acceptable to the Collateral Agent, slow moving, obsolete, unmerchantable, defective, used, unfit for sale, or unacceptable due to age, type, category or quantity;

(d) with respect to which any covenant, representation, or warranty contained in this Agreement or the Security Documents has been breached or is not true in any material respect and which does not conform in any material respect to all applicable standards imposed by any Governmental Authority, including the Fair Labor Standards Act of 1938, that would affect the ability of the applicable Credit Parties to sell such Inventory;

(e) in which any Person other than such Credit Party or any other applicable Credit Party shall (i) have any direct or indirect ownership, interest or title (including any retention of title right) to such Inventory, other than in respect of the interest of any carrier of Inventory in transit or (ii) be indicated on any purchase order or invoice with respect to such Inventory as having or purporting to have an interest therein;

(f) which is not located in the United States, Canada, the U.K., the Netherlands, Northern Ireland or, following the execution of collateral and perfection documentation satisfactory to the Collateral Agent, the U.K., the Netherlands, Northern Ireland or such other jurisdiction as may be acceptable to the Collateral Agent in its Permitted Discretion, or is in transit (other than between locations in the United States, Canada, the U.K. , Northern Ireland, the Netherlands or such other jurisdiction as may be acceptable to the Collateral Agent in its Permitted Discretion, controlled by the applicable Credit Parties, to the extent included in current perpetual inventory reports of any such Credit Party);

(g) which (i) is located in any location leased by an applicable Credit Party unless (A) the lessor has delivered to the Collateral Agent a Collateral Access Agreement or (B) a Rent Reserve with respect to such facility has been established by the Collateral Agent in its Permitted Discretion; (ii) is located at an owned location subject to a mortgage or other security interest in favor of a creditor other than the Collateral Agent or, to the extent permitted by Section 10.01(vi) , the holders of Specified Secured Indebtedness (or the representative thereof) or is located in any third party warehouse or other storage facility or is in the possession of a bailee unless (A) such mortgagee, warehouseman or bailee has delivered to the Collateral Agent a Collateral Access Agreement and such other documentation as the Collateral Agent may require in its Permitted Discretion or (B) a Rent Reserve or other Reserve has been established by the Collateral Agent in its Permitted Discretion; or (iii) is located in any location where the aggregate Eligible Inventory is less than $100,000;

(h) which is being processed offsite at a third party location or outside processor, or is in-transit to said third party location or outside processor, unless (i) solely in the case of Inventory at a third party location or outside processor, the owner of such third party location or outside processor has delivered to the Collateral Agent a Collateral Access Agreement or (ii) an appropriate Reserve has been established with respect to such Inventory;

(i) which is a discontinued product;

(j) which is the subject of a consignment;

 

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(k) which contains or bears any intellectual property rights licensed to such Credit Party unless the Collateral Agent is satisfied that it may sell or otherwise dispose of such Inventory without (i) infringing the rights of such licensor, (ii) violating any contract with such licensor, or (iii) incurring any liability with respect to payment of royalties other than royalties incurred pursuant to sale of such Inventory under the current licensing agreement;

(l) which is not reflected in a current inventory report of such Credit Party (unless such Inventory is reflected in a report to the Collateral Agent as “in transit” Inventory);

(m) for which reclamation or revendication rights have been asserted by the seller;

(n) which consists of goods that are not in salable condition;

(o) which is Commingled Inventory;

(p) which is not covered by casualty insurance as and to the extent required by the terms of this Agreement;

(q) which consists of Hazardous Materials or goods (other than fuels) that can be transported or sold only with licenses that are not readily available;

(r) in which any portion of the cost of such Inventory is attributable to intercompany profit between any such Credit Party and any of its Affiliates (but only to the extent of such portion);

(s) which could be subject to repossession pursuant to Section 81.1 or Section 81.2 of the Bankruptcy and Insolvency Act (Canada) or similar provisions of applicable law except to the extent the applicable vendor has entered into an agreement with the Collateral Agent, in form and substance reasonably satisfactory to the Collateral Agent, waiving its right to repossession;

(t) which was acquired after the Closing Date (other than from another Borrower U.S. Credit Party , Canadian Credit Party or English Credit Party) and that has a fair market value of $10,000,000 or more in the aggregate, until the completion of an appraisal and field examination of such Inventory, in each case, reasonably satisfactory to the Collateral Agent; or

(u) which in the case of Inventory owned by the English Credit Parties has been sold or constructively delivered to Account Debtors; or

(v) which is otherwise unacceptable to the Collateral Agent in its Permitted Discretion.

“ Eligible Investment Grade Account ” shall mean an Eligible Account with an Account Debtor that has an Investment Grade Rating as of the relevant date of calculation of the Borrowing Base.

“ Eligible U.S. Accounts ” shall mean the Eligible Accounts owned by the U.S. Credit Parties.

“ Eligible U.S. Inventory ” shall mean the Eligible Inventory owned by the U.S. Credit Parties.

“ English Credit Parties ” shall mean the English Guarantors and an English Subsidiary which becomes a Canadian Borrower pursuant to Section 2.22 (a) .

 

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“ English Collection Account ” shall mean each account established at an English bank subject to a Deposit Account Control Agreement into which funds shall be transferred as provided in Section 9.17(c)(iii) .

“ English Collection Bank ” shall mean any bank that maintains an English Collection Account.

“ English Dominion Account ” shall have the meaning set forth in Section 9.17 .

“ English Guarantor ” shall mean each Wholly-Owned English Subsidiary established, created or acquired after the Closing Date which becomes a party to this Agreement in accordance with the requirements of this Agreement pursuant to Section 9.12 or otherwise.

“ English Priority Payables ” shall mean, at any time, with respect to the Canadian Borrowing Base, the amount estimated on or prior to the date as of which the Canadian Borrowing Base is to be determined ; (i) as payable in the administration of any English Credit Party to preferential creditors as specified in Schedule 6 to the Insolvency Act 1986 as having preferential debts and any other person which in the Collateral Agent’s opinion may be entitled to receive payment out of floating charge realisations in priority to or equally with the Lenders and includes, without limitation, all amounts falling within the “prescribed part” for the purposes of Section 176A of the Insolvency Act 1986 and the Insolvency Act (Prescribed Part) Order 2003 or (ii) in respect of which any Person may claim a security interest, hypothecation, prior claim, trust or other claim or Lien ranking or capable of ranking in priority to or pari passu with one or more of the Liens granted pursuant to the Security Documents (a “ Priority Lien ”).

“ English Priority Payables Reserve ” shall mean, on any date of determination for the Canadian Borrowing Base, a reserve established from time to time by the Collateral Agent in its Permitted Discretion in such amount as the Collateral Agent may reasonably determine in respect of English Priority Payables of the English Credit Parties.

“ English Security Agreement ” shall mean the English law security agreement over all assets of the English Credit Parties, including, without limitation, the shares of the English Credit Parties, the Eligible English Accounts, the English Dominion Account, the English Collection Account and the Eligible English Inventory to be entered into among the Credit Parties party thereto and the Collateral Agent, for the benefit of the Secured Creditors.

“ English Subsidiary ” of any Person shall mean any Subsidiary of such Person incorporated or organized under the laws of England and Wales.

“ Environment ” shall mean ambient air, indoor air, surface water, groundwater, drinking water, land surface and sub-surface strata, sediments and natural resources such as wetlands, flora and fauna.

“ Environmental Claims ” shall mean any and all administrative, regulatory or judicial actions, suits, demands, demand letters, directives, claims, liens and/or notices of noncompliance or violation, relating to any Environmental Law or, any permit issued, or any approval given, under any such Environmental Law, including, without limitation, (a) by governmental or regulatory authorities for enforcement, cleanup, removal, response, remedial or other actions or damages pursuant to any applicable Environmental Law , and (b) by any third party seeking damages, contribution, indemnification, cost recovery, compensation or injunctive relief arising out of or relating to an alleged injury or threat of injury to human health or the Environment due to any Release or threat of Release of any Hazardous Materials not in compliance with Environmental Law.

 

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“ Environmental Law ” shall mean any applicable federal, state, provincial, foreign, municipal, local or foreign statute, law, rule, regulation, ordinance, code, binding guideline and rule of common law, now or hereafter in effect and in each case as amended, and any applicable published judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment relating to pollution or protection of the Environment, occupational safety or health or Hazardous Materials, including, without limitation, CERCLA; the Resource Conservation and Recovery Act, 42 U.S.C. § 6901 et seq .; the Federal Water Pollution Control Act (commonly known as the Clean Water Act), 33 U.S.C. § 1251 et seq .; the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq .; the Clean Air Act, 42 U.S.C. § 7401 et seq .; the Safe Drinking Water Act, 42 U.S.C. § 3803 et seq .; the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq .; the Emergency Planning and the Community Right-to-Know Act of 1986, 42 U.S.C. § 11001 et seq .; the Hazardous Material Transportation Act, 49 U.S.C. § 1801 et seq .; and any federal, state, provincial, municipal, local or foreign counterparts or equivalents, in each case as amended from time to time.

“ Equity Interests ” 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, any limited or general partnership interest and any limited liability company or unlimited liability company membership interest.

“ ERISA ” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and, unless the context indicates otherwise, the regulations promulgated and rulings issued thereunder. Section references to ERISA are to ERISA as in effect at the date of this Agreement and any successor Section thereof.

“ ERISA Affiliate ” shall mean each person (as defined in Section 3(9) of ERISA) which together with any Credit Party would be deemed to be a “single employer” within the meaning of Section 414(b) or (c) of the Code and, solely with respect to Section 412 of the Code, within the meaning of Sections 414(b), (c), (m) or (o) of the Code.

“ ERISA Event ” shall mean (a) any “reportable event,” as defined in Section 4043 of ERISA or the regulations issued thereunder, but excluding any event for which the 30-day notice period is waived with respect to a Plan, (b) any failure to make a required contribution to any Plan or Multiemployer Plan that would result in the imposition of a Lien or other encumbrance or the failure to satisfy the minimum funding standards set forth in Sections 412 or 430 of the Code or Section 302 or 303 of ERISA, or the arising of such a Lien or encumbrance, with respect to a Plan, (c) the incurrence by the Company, a Restricted Subsidiary, or an ERISA Affiliate of any liability under Title IV of ERISA with respect to the termination of any Plan or the withdrawal or partial withdrawal (including under Section 4062(e) of ERISA) of any of the Company, a Restricted Subsidiary, or an ERISA Affiliate from any Plan or Multiemployer Plan, (d) the filing of a notice of intent to terminate, the treatment of a Plan amendment as a termination under Section 4041 of ERISA, or the receipt by the Company, a Restricted Subsidiary, or an ERISA Affiliate from the PBGC or a plan administrator of any notice of intent to terminate any Plan or Multiemployer Plan or to appoint a trustee to administer any Plan, (e) the adoption of any amendment to a Plan that would require the provision of security pursuant to the Code, ERISA or other applicable law, (f) the receipt by the Company, a Restricted Subsidiary, or an ERISA Affiliate of any notice concerning statutory liability arising from the withdrawal or partial withdrawal of the Company, a Restricted Subsidiary, or an ERISA Affiliate from a Multiemployer Plan or a determination that a Multiemployer Plan is insolvent or in reorganization, within the meaning of Title IV of ERISA, (g) the occurrence of any non-exempt “prohibited transaction” (within the meaning of Section 406 of ERISA or Section 4975 of the Code) with respect to which the Company or any Restricted Subsidiary is a “disqualified person” (within the meaning of Section 4975 of the Code) or with respect to which the Company or any Restricted Subsidiary could reasonably be expected to have liability, (h) the occurrence

 

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of any event or condition which constitutes grounds under Section 4042 of ERISA for the termination of any Plan or the appointment of a trustee to administer any Plan, (i) the filing of any request for or receipt of a minimum funding waiver under Section 412(c) of the Code with respect to any Plan or Multiemployer Plan, (j) a determination that any Plan is in “at-risk” status (as defined in Section 303(i)(4) of ERISA or Section 430(i)(4) of the Code), (k) the receipt by the Company, a Restricted Subsidiary or any ERISA Affiliate of any notice that a Multiemployer Plan is, or is expected to be, in endangered or critical status under Section 305 of ERISA or (l) any other extraordinary event or condition with respect to a Plan or Multiemployer Plan which could reasonably be expected to result in a Lien or any acceleration of any statutory requirement to fund all or a substantial portion of the unfunded accrued benefit liabilities of such plan.

“ Escrow Indebtedness Escrow Account ” shall mean an escrow account subject to a customary escrow agreement holding the proceeds of Indebtedness permitted hereunder and providing for the release of such proceeds upon the occurrence of a specified contingency.

“ European Area ” shall mean the U.K., Belgium, Ireland and Germany. 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.

“ Event of Default ” shall have the meaning provided in Section 11 .

“ Excluded Account ” shall mean a Deposit Account, securities account or commodities account (i) which is used for the sole purpose of making payroll and withholding tax payments related thereto and other employee wage and benefit payments and accrued and unpaid employee compensation (including salaries, wages, benefits and expense reimbursements), (ii) which is used for the sole purpose of paying or remitting taxes, including sales taxes, (iii) which is used solely as an escrow account or as a fiduciary or trust account, including, but not limited to, any Escrow Indebtedness Escrow Account, (iv) which is a zero balance Deposit Account, (v) which is a Specified Secured Indebtedness Collateral Account, (vi) all of the funds on deposit of which are subject to a Permitted Lien specified in Section 10.01(xii) , (xxiii) , (xxxiv) or , (xxxv)  or (xxxvi) , (vii) which is held by a Subsidiary that is not a Credit Party, or (viii) Deposit Accounts, securities accounts and commodities accounts, the aggregate average daily balance in which (in each case determined for the most recently completed calendar month) does not at any time exceed (x) $50,000,000 in the aggregate for all such accounts if Availability is greater than $150,000,000 or (y) $20,000,000 in the aggregate for all such accounts if Availability is less than or equal to $ 150,000,0000, 150,000,000; provided , however , that, notwithstanding the above, an account shall not be an Excluded Account if such account is a Core Concentration Account or a Collection Account.

“ Excluded Collateral ” shall mean , with respect to (i) a U.S. Credit Party, have the meaning provided in the U.S. Security Agreement, (ii) a Canadian Credit Party, mean all assets specifically described in a Canadian Security Agreement as being excluded from the grant of security and (iii) an English Credit Party, mean all assets specifically described in a U.K. Security Document as being excluded from the grant of security.

“ Excluded Swap Obligation ” shall mean, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guaranty of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to Section 14.11 hereof and any other “keepwell, support or other agreement” for the benefit of such Guarantor and any and all guarantees of

 

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such Guarantor’s Swap Obligations by other Credit Parties) at the time the Guaranty of such Guarantor, or a grant by such Guarantor of a security interest, becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guaranty or security interest is or becomes excluded in accordance with the first sentence of this definition.

“ Excluded Taxes ” shall mean, with respect to the Administrative Agent, any Lender, or any other recipient of any payment to be made by or on account of any obligation of any Credit Party under any Credit Document, (a) income Taxes imposed on (or measured by) its net income and franchise (and similar) Taxes imposed on it in lieu of income Taxes, either pursuant to the laws of the jurisdiction in which such recipient is organized or in which the principal office or applicable lending office of such recipient is located (or any political subdivision thereof) or as a result of any other present or former connection between it and the jurisdiction imposing such Tax (other than a connection arising from such Administrative Agent, Lender or other recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Credit Document, or sold or assigned an interest in any Loan or Credit Document), (b) any branch profits Taxes under Section 884(a) of the Code, or any similar Tax, imposed by any jurisdiction described in clause (a) above, (c) solely with respect to the U.S. Subfacility or the U.S. FILO Subfacility or any borrowing by any U.S. Borrower under the Canadian Subfacility or the Canadian FILO Subfacility, in the case of a Lender (other than an assignee pursuant to a request by the Company under Section 3.04) , any U.S. federal withholding Tax that is imposed on amounts payable to such Lender pursuant to a law in effect at the time such Lender becomes a party to this Agreement (or designates a new lending office), except to the extent that such Lender (or its assignor, if any) was entitled, immediately prior to the time of designation of a new lending office (or assignment), to receive additional amounts from a Credit Party with respect to such U.S. federal withholding Tax pursuant to Section 5.01 , (d) any withholding Tax that is attributable to such recipient’s failure to comply with Section 5.01(b) or Section 5.01(c) (in each case, subject to Section 5.01(d) ), (e) solely with respect to the U.S. Subfacility or the U.S. FILO Subfacility or any borrowing by any U.S. Borrower under the Canadian Subfacility or the Canadian FILO Subfacility, any withholding Taxes imposed under FATCA, (f) U.S. federal backup withholding Taxes pursuant to Code Section 3406, (g) solely with respect to the Canadian Subfacility or the Canadian FILO Subfacility (excluding any borrowing by any U.S. Borrower under the Canadian Subfacility or the Canadian FILO Subfacility), any Canadian Taxes as a result of such Lender not dealing at arm’s length (within the meaning of the ITA) with a Canadian Credit Party, and (h) solely with respect to the Canadian Subfacility or the Canadian FILO Subfacility (excluding any borrowing by any U.S. Borrower under the Canadian Subfacility or the Canadian FILO Subfacility), any Canadian Taxes as a result of such Lender being a “specified shareholder” (within the meaning of subsection 18(5) of the ITA) of a Canadian Credit Party or not dealing at arm’s length with such specified shareholder of a Canadian Credit Party.

“ Executive Order ” shall mean Executive Order No. 13224 on Terrorist Financing effective September 24, 2001.

“ Existing Credit Agreement ” shall mean the ABL Credit Agreement, dated as of December 9, 2010, among the Company, certain subsidiaries of the Company party thereto, certain lenders party thereto and Citibank N.A., as the administrative agent (as amended, restated or otherwise modified from time to time prior to the Closing Date).

“ Existing Letters of Credit ” shall mean those Letters of Credit set forth on Schedule 1.01B .

“ Existing Indebtedness ” shall have the meaning provided in Section 10.04(vii) .

 

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“ Existing Revolving Loans ” shall have the meaning assigned to such term in Section 2.19(a) .

“ Extended Revolving Loans ” shall have the meaning assigned to such term in Section 2.19(a) .

“ Extended Revolving Loan Commitments ” shall mean one or more commitments hereunder to convert Existing Revolving Loans to Extended Revolving Loans of a given Extension Series pursuant to an Extension Amendment.

“ Extending Lender ” shall have the meaning provided in Section 2.19(c) .

“ Extension Amendment ” shall have the meaning provided in Section 2.19(d) .

“ Extension Election ” shall have the meaning provided in Section 2.19(c).

“ Extension Request ” shall have the meaning provided in Section 2.19(a) .

“ Extension Series ” shall have the meaning provided in Section 2.19(a) .

“ Fair Value ” shall mean the amount at which the assets (both tangible and intangible), in their entirety, of the Company and its Subsidiaries taken as a whole would change hands between an independent willing buyer and a willing seller, within a commercially reasonable period of time, each having reasonable knowledge of the relevant facts, with neither being under any compulsion to act.

“ Farm Credit Act” shall mean the Farm Credit Act of 1971.

“Farm Credit Agreement” shall mean that certain Credit Agreement, dated as of September 7, 2016, by and among the Company, certain of the Company’s subsidiaries party thereto from time to time as borrowers and guarantors, the lenders party thereto from time to time and American AgCredit PCA, as administrative agent, as modified, supplemented, amended, restated (including any amendment and restatement hereof), refinanced, extended or renewed from time to time.

“Farm Credit Agreement Reserves” shall mean, on any date when the Farm Credit Agreement or any successor thereto is in effect and matures on a date (the “Farm Credit Maturity Date”) prior to the Maturity Date, a Reserve, commencing on the date that is 60 days prior to such Farm Credit Maturity Date, in an amount equal to the principal amount outstanding under the Farm Credit Agreement.

“ FATCA ” shall mean Sections 1471 through 1474 of the Code as of the date of this Agreement Second Amendment Effective Date (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations thereunder or official interpretations thereof, any agreements entered into pursuant to current Section 1471(b)(1) of the Code (or any amended or successor version described above), and any intergovernmental agreements implementing the foregoing.

“ FCPA ” shall have the meaning provided in Section 8.15(c) .

“ Federal Funds Rate ” shall mean (a) , for any day, the rate per annum equal to the weighted average of interest the rates on overnight federal Federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers on the applicable Business Day (or on the preceding Business Day, if the applicable day is not a Business Day ) on such day , as published by the Federal Reserve Bank of New York on the next Business Day; or Business Day next succeeding such day; provided that (a) if such day is not a Business Day , the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business

 

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Day and (b) if no such rate is so published on the such next succeeding Business Day, the F ederal Funds Rate for such day shall be the average rate (rounded up upward , if necessary, to the nearest 1/8 a whole multiple of 1/100 of 1%) charged to the Administrative Agent on the applicable Bank of America, N.A. on such day on such transactions , as reasonably determined by the Administrative Agent ; provided that if the Federal Funds Rate shall be less than zero, such rate shall be deemed zero for purposes of this Agreement .

“ Fees ” shall mean all amounts payable pursuant to or referred to in Section 2.05 .

“FILO Amendment” shall have the meaning provided in Section 2.21(c).

“ FILO Borrowing ” shall mean a Borrowing comprised of FILO Loans under any FILO Subfacility.

“ FILO Commitment ” shall mean the Canadian FILO Commitment, if any and/or the U.S. FILO Commitment, if any.

“ FILO Exchange Offer ” shall mean the Canadian FILO Exchange Offer, and/or the U.S. FILO Exchange Offer, as the context may require.

“ FILO Lender ” shall mean the Canadian FILO Lender , and/or the U.S. FILO Lender, as the context may require.

“ FILO Line Cap ” shall mean the Canadian FILO Line Cap , and/or the U.S. FILO Line Cap, as the context may require.

“ FILO Loans ” shall mean the Canadian FILO Loans , and/or the U.S. FILO Loans, as the context may require.

“ FILO Subfacility ” shall mean the Canadian FILO Subfacility and/or the U.S. FILO Subfacility, as the context may require.

“First Amendment” shall mean that certain Amendment No. 1, dated as of December 22, 2017, among the Company, the other Credit Parties, the U.S. Administrative Agent, the Canadian Administrative Agent, the Collateral Agent and the Lenders party thereto.

“ Flood Insurance Laws ” shall mean, collectively, (i) the National Flood Insurance Act of 1968 as now or hereafter in effect or any successor statute thereto, (ii) the Flood Disaster Protection Act of 1973 as now or hereafter in effect or any successor statute thereto, (iii) the National Flood Insurance Reform Act of 1994 as now or hereafter in effect or any successor statute thereto, (iv) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statute thereto and (v) the Biggert-Waters Flood Insurance Reform Act of 2012 and similar applicable laws in Canada as now or hereafter in effect or any successor statute thereto.

“ Foreign Currency Long-Term Debt Rating ” for any Approved Country shall mean the rating by S&P or Moody’s of such Approved Country’s public, long-term foreign currency debt.

“ Foreign Pension Plan ” shall mean any plan, fund (including, without limitation, any superannuation fund) or other similar program established or maintained outside the United States or Canada by the Company or any one or more of the Restricted Subsidiaries primarily for the benefit of employees of the Company or such Restricted Subsidiaries residing outside the United States or Canada, 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 Canadian Employee Benefits Legislation.

 

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