Form 8-K HEMISPHERE MEDIA GROUP, For: Mar 31

April 6, 2021 5:05 PM EDT

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EXHIBIT 2.1

 

Certain identified information has been excluded from the exhibit because it is both not material and would likely cause competitive harm to the Company if publicly disclosed.

 

 

Execution Version

PRIVILEGED AND CONFIDENTIAL

 

 

 

 

SECURITIES PURCHASE AGREEMENT

by and among

HMTV DTC, LLC,

PANTAYA, LLC

and

ARTISAN HOME ENTERTAINMENT INC.

 

 

 

Dated as of March 31, 2021

 


 

 

  

 

TABLE OF CONTENTS

Page

Article I DEFINITIONS 1
Section 1.1   Definitions 1
Section 1.2   Other Capitalized Terms 14
Section 1.3   Interpretive Provisions 16
Article II PURCHASE AND SALE OF UNITS 17
Section 2.1   Purchase and Sale of the Units and Interests 17
Section 2.2   Calculation of Purchase Price 17
Section 2.3   Purchase Price Adjustment 18
Section 2.4   Withholding 19
Section 2.5   Allocation of Amounts Paid By the Buyer 20
Article III THE CLOSING 20
Section 3.1   Closing; Closing Date 20
Section 3.2   Transactions to Be Effected at Closing 21
Article IV REPRESENTATIONS AND WARRANTIES OF THE SELLER 22
Section 4.1   Corporate Organization 22
Section 4.2   Due Authorization 22
Section 4.3   No Conflict 22
Section 4.4   No Authorization or Consents Required 23
Section 4.5   Litigation; Orders 23
Section 4.6   Title to Units 23
Section 4.7   Brokers 23
Section 4.8   No Other Representations or Warranties; Non-Reliance 23
Article V REPRESENTATIONS AND WARRANTIES AS TO THE COMPANY 24
Section 5.1   Company Organization 24
Section 5.2   Due Authorization 24
Section 5.3   No Conflict 25
Section 5.4   No Authorization or Consents Required 25
Section 5.5   Litigation; Orders 26
Section 5.6   Capitalization 26
Section 5.7   Subsidiaries 26
Section 5.8   Financial Statements 27
Section 5.9   Absence of Certain Developments 28
Section 5.10   Taxes 28
Section 5.11   Contracts 29
Section 5.12   Service Operations 31
Section 5.13   Programming 32
Section 5.14   Intellectual Property 37
Section 5.15   Property 39
Section 5.16   Labor Matters 39

 

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Section 5.17   Employee Benefit Plans 41
Section 5.18   Insurance 42
Section 5.19   Compliance with Laws 42
Section 5.20   Environmental Matters 43
Section 5.21   Affiliate Transactions 44
Section 5.22   Sufficiency of Assets 44
Section 5.23   Brokers 44
Article VI REPRESENTATIONS AND WARRANTIES OF THE BUYER 44
Section 6.1   Corporate Organization 44
Section 6.2   Due Authorization 45
Section 6.3   No Conflict 45
Section 6.4   No Authorization or Consents Required 45
Section 6.5   Litigation; Orders 46
Section 6.6   Investment Purpose 46
Section 6.7   Brokers 46
Section 6.8   No Other Representations or Warranties; Non-Reliance 46
Article VII COVENANTS 47
Section 7.1   Confidentiality 47
Section 7.2   Non-Competition; Non-Solicitation 47
Section 7.3   Public Announcements 50
Section 7.4   Cooperation with SEC Filings 50
Section 7.5   Release 52
Section 7.6   Employee Matters 54
Section 7.7   Termination of LLC Agreement 54
Section 7.8   Pantelion 2.0 54
Section 7.9   Wrong Pocket 55
Section 7.10   Insurance 55
Section 7.11   Mixed-Use Contracts; Non-Assignable Contracts 56
Section 7.12   Certain Matters 57
Article VIII TAX MATTERS 57
Section 8.1   Tax Preparation of Tax Returns and Payment of Taxes 57
Section 8.2   Tax Indemnification 59
Section 8.3   Tax Indemnification Procedures 60
Section 8.4   Tax Audits and Contests; Cooperation 60
Section 8.5   Straddle Periods 62
Section 8.6   Conveyance Taxes 63
Section 8.7   Tax Treatment 63
Section 8.8   Post-Closing Actions 63
Article IX INDEMNIFICATION 63
Section 9.1   Survival 64
Section 9.2   Indemnification of the Buyer for Seller-Specific Breaches 64
Section 9.3   Indemnification of the Seller 64
Section 9.4   Limitations 65

 

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Section 9.5   Limitation on Remedies 66
Section 9.6   Third Party Claims 66
Section 9.7   Direct Claims 68
Section 9.8   Additional Matters 68
Article X MISCELLANEOUS 69
Section 10.1   Expenses 69
Section 10.2   Amendments and Waivers 69
Section 10.3   Entire Agreement 69
Section 10.4   Notices 70
Section 10.5   Binding Effect; Assignment 71
Section 10.6   No Third Party Beneficiary 71
Section 10.7   Governing Law 71
Section 10.8   Consent to Jurisdiction and Service of Process 71
Section 10.9   WAIVER OF JURY TRIAL 72
Section 10.10   Specific Performance 72
Section 10.11   Severability 72
Section 10.12   No Recourse Against Non-Parties 73
Section 10.13   Counterparts 73
Section 10.14   Guarantee 73

 

EXHIBITS

Exhibit A Form of Licensed Technology Agreement

Exhibit B Form of Contribution Agreement

Exhibit C [Intentionally Omitted]

Exhibit D [Intentionally Omitted]

Exhibit E [Intentionally Omitted]

Exhibit F [Intentionally Omitted]

Exhibit G Form of TSA

Exhibit H-1 [Intentionally Omitted]

Exhibit H-2 [Intentionally Omitted]

Exhibit I Form of Instrument of Assignment

Exhibit J [Intentionally Omitted]

Exhibit K Disclosure Schedules

SCHEDULES

Schedule 1.1(a) Management Equity Amount

Schedule 1.1(b) Underpayment Amount

Schedule 1.1(c) Unmatched Funding Amount

Schedule 1.1(d) Consent Fee Exclusions

Schedule 3.2(a)(ii) Required Notices and Consents

Schedule 3.2(a)(iii) Terminated Affiliate Agreements

Schedule 3.2(a)(iv) Resigning Directors, Managers and Officers

Schedule 7.2(a)(ii) Non-Solicitation – Specified Employees

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SECURITIES PURCHASE AGREEMENT

SECURITIES PURCHASE AGREEMENT, dated as of March 31, 2021 (this “Agreement”), by and among HMTV DTC, LLC, a Delaware limited liability company (the “Buyer”), Pantaya, LLC, a Delaware limited liability company (the “Company”), Artisan Home Entertainment Inc., a Delaware corporation (the “Seller”) and, solely for purposes of Section 10.14, Lions Gate Entertainment Inc., a Delaware corporation (the “Seller Guarantor” and, collectively, with the Buyer, the Seller and the Company, the “Parties”).

RECITALS

A.                  The Seller owns 750 of the issued and outstanding membership units of the Company (the “Units”).

B.                  The Seller desires to sell, transfer, assign and deliver to the Buyer, free and clear of all Liens (other than restrictions on transfer arising under applicable federal and state securities Laws), the Units, and the Buyer desires to purchase, acquire and accept from the Seller, the Units, in each case, on the terms and subject to the conditions set forth in this Agreement.

C.                  Concurrently herewith, the Parties and/or certain Affiliates of the Parties have entered into the other Transaction Documents.

ACCORDINGLY, in consideration of the foregoing and the mutual representations, warranties, covenants and agreements contained in this Agreement and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows:

Article I

DEFINITIONS

Section 1.1                  Definitions. The following capitalized terms shall have the following meanings for all purposes of this Agreement:

Action” means any action, claim, demand, arbitration, hearing, charge, audit, assessment, complaint, investigation, examination, indictment, litigation, suit or other civil, criminal, administrative or investigative proceeding.

Adjustment Amount” means an amount equal to (a) the Unmatched Funding Amount, plus (b) the Seller Percentage of Closing Cash, minus (c) the Seller Percentage of Closing Indebtedness, minus (d) one hundred percent (100%) of Seller Transaction Expenses, minus (e) the Management Equity Amount, minus (f) the Underpayment Amount.

Affiliate” means, with respect to any specified Person, any other Person that directly or indirectly controls, is controlled by or is under common control with such

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specified Person. For the purposes of this definition, the term “control,” when used with respect to any specified Person, means the power to direct or cause the direction of the management or policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have correlative meanings.

Balance Sheet Rules” means GAAP; provided that in the event of any conflict between GAAP and any applicable definitions set forth in this Agreement, the applicable definitions shall govern.

Benefit Plan” means any pension, profit-sharing, savings, retirement, employment, collective bargaining, consulting, severance, termination, executive compensation, incentive compensation, deferred compensation, bonus, tax gross-up, stock purchase, stock option, phantom stock or other equity-based compensation, change-in-control, retention, salary continuation, vacation, sick leave, disability, supplemental executive retirement, retirement, death benefit, group insurance, hospitalization, medical, dental, life (including all individual life insurance policies as to which the Company or any Subsidiary of the Company is the owner, the beneficiary or both), retiree medical, Code Section 125 “cafeteria” or “flexible” benefit, employee loan, educational assistance or fringe benefit plan, program, policy, practice, agreement or arrangement, whether written or oral, formal or informal, including each “employee benefit plan” within the meaning of ERISA, Multiemployer Plan and other employee benefit plan, program, policy, practice, agreement or arrangement, whether or not subject to ERISA (including any funding mechanism therefor now in effect or required in the future under the current terms of a Company Plan as a result of the Contemplated Transactions).

Business Day” means any day other than a Saturday, a Sunday or other day on which commercial banks in New York, New York or Los Angeles, California are authorized or required by Law to close.

Buyer Fundamental Representations” means the representations and warranties set forth in Sections 6.1 (Corporate Organization), 6.2 (Due Authorization) and 6.7 (Brokers).

Capital Stock” means (a) any shares, interests, participations or other equivalents (however designated) of capital stock of a corporation; (b) any ownership interests in a Person other than a corporation, including units, membership interests, partnership interests, joint venture interests and beneficial interests; and (c) any warrants, options, convertible or exchangeable securities, subscriptions, calls or other rights (including preemptive rights) to purchase or acquire any of the foregoing.

CARES Act” means U.S. Public Law Number 116-136, as amended.

Cash Sweep Amount” means $14,954,849.

Closing Cash” means the amount of consolidated cash (excluding restricted cash, other than any deposit made to any union or guild) of the Company and its Subsidiaries, in each case, outstanding as of immediately prior to the Closing,

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determined without giving effect to the Closing, in accordance with the Balance Sheet Rules. For the avoidance of doubt, Closing Cash is determined after payment by the Company at the Closing of any Seller Transaction Expenses and after subtracting the Cash Sweep Amount.

Closing Indebtedness” means the amount of consolidated Indebtedness of the Company and its Subsidiaries, in each case, outstanding as of immediately prior to the Closing, determined without giving effect to the Closing, in accordance with the Balance Sheet Rules.

COBRA” means the United States Consolidated Omnibus Budget Reconciliation Act of 1985.

Code” means the Internal Revenue Code of 1986, as amended.

Company Audit Costs” means any fees, costs and expenses or payments of the Company or any of its Subsidiaries or Affiliates related to or in connection with any audit of any such Person, excluding Company Audit Preparation Costs.

Company Audit Preparation Costs” means any fees, costs and expenses or payments of the Company or any of its Subsidiaries or Affiliates related to or in connection with such Person’s preparation for any audit of any such Person.

Company Fundamental Representations” means the representations and warranties set forth in Sections  5.1 (Company Organization), 5.2 (Due Authorization), 5.6 (Capitalization), 5.7 (Subsidiaries) and 5.23 (Brokers).

Company Plan” means any Benefit Plan: (a) under which any Service Provider has any present or future right to benefits and that is maintained, sponsored or contributed to, or required to be contributed to, by the Company or any Subsidiary of the Company; or (b) with respect to which the Company or any Subsidiary of the Company has any Liability; provided, however, that “Company Plan” shall not include any Seller Plan.

Company Programs” means any (a) completed film, television or other long-form audio-visual programs, whether owned by or licensed to the Company or its Subsidiaries, which are currently being Exploited or are otherwise available for Exploitation by the Company and its Subsidiaries; and (b) film, television or other long-form audio visual programs that are currently in any stage of production and are being produced, co-produced, financed or co-financed by the Company and its Subsidiaries.

Company Projects” means any film, television or other long-form audio-visual programs that are currently being developed by the Company or its Subsidiaries.

Competing Business” means any business, firm, company, partnership, joint venture, organization or other Person that owns or operates a Competing Service.

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Competing Service” means any stand-alone predominantly (in terms of content offering) Spanish language (i.e., originally produced in Spanish) subscription video on demand service predominantly made available to, and marketed to, users residing in the United States.  For the avoidance of doubt, the definition of “Competing Service” is not intended to capture: (a) a subscription video on demand service that is (in terms of its content offering) predominantly an English-language (or other non-Spanish language) movie service that provides its subscribers with access to a Spanish language secondary audio stream (e.g., a SAP option) or Spanish-language subtitles; (b) a subscription video on demand service that is tethered to a linear subscription pay television service (i.e., offered only on an authenticated basis to linear subscription pay television subscribers for no additional charge); or (c) a bundled offering of subscription video on demand services that includes a Spanish language service (e.g., a Starz Latinx video on demand service offered in the United States only in a multiplex with the flagship Starz video on demand services would not be considered a Competing Business) as long such Spanish language service is not the predominant service in the bundled offering; provided, that, for the avoidance of doubt, such separate Spanish language service (e.g., a Starz Latinx video on demand service offered in the United States) cannot be made available on an a-la-carte basis.

Consent Fees” means any amounts payable by the Company or any of its Subsidiaries in connection with receipt of any consent or approval in connection with the Contemplated Transactions, other than any such amounts payable to any Person set forth on Schedule 1.1(d).

Contemplated Transactions” means the transactions contemplated by the Transaction Documents.

Content Agreements” means any Contract (a) granting to the Company, or any of its Subsidiaries, any rights to develop, produce, co-produce, finance, own, acquire, sell, license or otherwise distribute, transmit, broadcast, exhibit, record or exploit any Company Program or (b) whereby the Company, or any of its Subsidiaries, grants, transfers, assigns or licenses to any third party the right to develop, produce, co-produce, finance, own, acquire, sell, license or otherwise distribute, transmit, broadcast, exhibit, record or exploit any Company Program.

Contract” means any legally binding contract, agreement, indenture, note, bond, loan, lease, sublease, conditional sales contract, mortgage, license, sublicense, franchise agreement or other legally binding arrangement, whether written or oral.

Contribution Agreement” means a contribution agreement with respect to the contribution of all of the issued and outstanding equity interests of Pantelion 2.0 to the Company free and clear of all Liens other than restrictions on transfer arising under applicable federal and state securities Laws in the form attached hereto as Exhibit B.

COVID-19” means SARS-CoV-2 or COVID-19, and any evolutions or mutations thereof or related or associated epidemics, pandemics or disease outbreaks.

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COVID-19 Measures” means any quarantine, “shelter in place,” “stay at home,” social distancing, shut down, closure, sequester, safety or similar Law, directive, guideline, restriction or requirement promulgated by any Governmental Authority, including the Centers for Disease Control and Prevention and the World Health Organization, in each case, in connection with or in response to COVID-19.

Disclosure Schedules” means the disclosure schedules, dated as of the date hereof, accompanying this Agreement and attached hereto as Exhibit K.

DOL” means the U.S. Department of Labor.

Enforceability Exceptions” means (a) any applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar Laws affecting creditors’ rights generally and (b) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).

Environmental Law” means any Law relating to (a) the protection or regulation of the environment or natural resources, (b) the protection or regulation of human health and safety with respect to exposure to Hazardous Substances, or (c) the regulation or remediation of Hazardous Substances.

Environmental Permit” means any Permit required under or issued, granted, given, authorized by or made pursuant to Environmental Law.

ERISA” means the Employee Retirement Income Security Act of 1974.

ERISA Affiliate” means any entity that, at the time of reference, together with the Company or any Subsidiary of the Company, would be treated as a single employer under Section 4001 of ERISA or Section 414 of the Code.

Exchange Act” means the Securities Exchange Act of 1934, as amended.

Existing LGE-Derbez Agreement” means that certain Memorandum of Agreement dated as of August 20, 2014, as amended, by and among 3Pas Studios, LLC, for the possible producing services of Eugenio Derbez and Ben Odell and Derbez Entertainment Inc. for the possible directing, acting and/or writing services of Eugenio Derbez, on the one hand, and Pantelion, LLC and the Seller Guarantor, on the other hand.

Flow-Through Tax Return” means a Tax Return of the Company related to a Pre-Closing Tax Period (other than any Straddle Period) which reports taxable income relating to the Company but with respect to which the direct or indirect beneficial owners of the Company, and not the Company itself, are required to pay the related Tax.

Fundamental Representations” means, collectively, the Company Fundamental Representations, the Seller Fundamental Representations and the Buyer Fundamental Representations.

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GAAP” means United States generally accepted accounting principles, consistently applied.

Governmental Authority” means (a) any federal, provincial, state, local, municipal, national or international government or governmental authority, regulatory, environmental or administrative agency, governmental commission, department, board, bureau, agency or instrumentality, court, tribunal, arbitrator or arbitral body (public or private); (b) any self-regulatory organization; or (c) any political subdivision of any of the foregoing.

Hazardous Substance” means (a) any pollutant or contaminant; (b) any toxic, radioactive, ignitable, corrosive, reactive or otherwise hazardous substance, waste or material; or (c) any substance, waste or material having any constituent elements displaying any of the foregoing characteristics, including petroleum, its derivatives, by-products and other hydrocarbons and asbestos and asbestos-containing materials.

HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

Income Tax Return” shall mean any Tax Return filed or to be filed with respect to net income, capital, gross receipts, franchise, or any similar Taxes.

Indebtedness” means, without duplication: (a) any indebtedness or other obligation for borrowed money, whether current, short-term or long-term and whether secured or unsecured; (b) any indebtedness evidenced by any note, bond, debenture or other security or similar instrument; (c) any Liabilities with respect to interest rate or currency swaps, collars, caps and similar hedging obligations; (d) any Liabilities for the deferred purchase price of property or other assets (including any “earn-out” or similar payments, but not, for clarity, any Participations); (e) any Liabilities in respect of any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which Liabilities are required to be classified and accounted for under GAAP as capital leases; (f) any Liabilities under any performance bond or letter of credit or any bank overdrafts and similar charges; (g) any shareholder loans; (h) any accrued interest, premiums, penalties and other obligations relating to the foregoing; (i) any Taxes that have been deferred under Section 2302 of the CARES Act (or any provision of Law with similar effect or import) that otherwise would have been required to be deposited and paid in connection with amounts paid by the Company at any time prior to, or in connection with, the Closing; (j) any unpaid income Taxes of the Company or any of its Subsidiaries for any taxable period (or portion thereof) ending on or before the Closing Date; and (k) any indebtedness referred to in clauses (a) through (j) above of any Person that is either guaranteed (including under any “keep well” or similar arrangement) by, or secured (including under any letter of credit, banker’s acceptance or similar credit transaction) by any Lien upon any property or asset of the Company or any of its Subsidiaries, but, in each case, excluding any of the foregoing taken into account in the calculation of the Unmatched Funding Amount. “Indebtedness” shall also include accrued interest and any pre-payment penalties, “breakage costs”, redemption fees, costs and expenses or premiums and other amounts accrued, due and payable on the Closing

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Date pursuant to the instruments evidencing Indebtedness, assuming that such Indebtedness is repaid on the Closing Date.

Intellectual Property” means all intellectual property and proprietary rights arising from any of the following, as they exist anywhere in the world, whether registered or unregistered: (a) all patents, patentable inventions and other patent rights, including all reissues, divisions, divisionals, provisionals, continuations and continuations-in-part, renewals, extensions, reexaminations, utility models, design patents, certificates of invention and all documents and filings claiming priority to or serving as a basis for priority thereof, (b) all trademarks, service marks, trade names, service names, brand names, trade dress rights, logos, designs, corporate names, trade styles and other source or business identifiers, together with the goodwill associated with any of the foregoing, (c) all copyrights, copyrightable works, works of authorship and all other rights corresponding thereto, (d) all Software, (e) all trade secrets, know-how, industrial designs, business methods, technical and business data, improvements, processes, techniques, manuals, blueprints, plans, procedures, subscriber lists, distributor lists, supplier lists, confidential information and proprietary information and rights (whether or not patentable, reduced to practice or subject to copyright or trade secret protection) (“Trade Secrets”), (f) all Internet domain names, (g) all other intellectual property and proprietary rights of any kind, nature or description, and (h) all issuances, registrations, applications, extensions and renewals of any of the foregoing.

IRS” means the U.S. Internal Revenue Service.

IT Assets” means computers, Software, hardware, servers, workstations, peripherals, routers, hubs, switches, circuits, networks, Internet sites, data communications lines and all other information technology equipment and assets, including all associated documentation and specifications, owned, licensed, leased or otherwise used by the Company or any of its Subsidiaries.

JPM Credit Agreement” means that certain Credit and Guarantee Agreement, dated as of December 8, 2016, among Lions Gate Capital Holdings LLC, Lions Gate Entertainment Corp., JPMorgan Chase Bank, N.A. and the other parties thereto, as amended.

Knowledge” means (a) when used in reference to the Seller, the actual knowledge of Brian Goldsmith, Miles Delaney or Steve Gofman; (b) when used in reference to the Company, the actual knowledge of Brian Goldsmith, Miles Delaney or Steve Gofman after reasonable inquiry of Paul Presburger, Edward Allen, Ricardo Rodriguez and Jacqueline Jimenez as well as Rick Prell (solely with respect to Section 5.8) and Michael Hainkel (solely with respect to Section 5.10); and (c) when used in reference to the Buyer, the actual knowledge of Alan Sokol, Craig Fischer, Alex Tolston or Jim McNamara.

Labor Laws” means any Laws relating to employment, employment standards, employment of minors and of interns, employment discrimination, immigration, health and safety, employee classification, labor relations, withholding,

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payment of wages and overtime, hours, collective bargaining, harassment, workplace safety and insurance or pay equity, annual and casual leave, family and medical leave, and severance.

Law” means any law, statute, ordinance, code, regulation, rule or other requirement of any Governmental Authority, including common law or any international treaties.

Liability” means any liability, debt or obligation, in each case, whether accrued or contingent.

Licensed Programs” means all Company Programs that are not Owned Programs.

Licensed Technology Agreement” means the Amended and Restated Licensed Technology Agreement, between Starz Entertainment, LLC and the Company, substantially in the form attached hereto as Exhibit A.

Lien” means any lien, mortgage, deed of trust, hypothecation, deed to secure debt, pledge, charge, security interest, right of first refusal, right of first offer, option, restriction, covenant, condition, lease, sublease, license or other encumbrance of any kind.

LLC Agreement” means that certain Amended and Restated Limited Liability Agreement of the Company, effective as of November 2, 2016, by and between Hemisphere Media Holdings, LLC and the Seller.

Losses” means any losses, Liabilities, Taxes, damages, costs or expenses (including reasonable costs of investigation and defense and reasonable attorney’s fees, costs and expenses, but excluding punitive damages and consequential damages, except (a) in each case, to the extent payable to a third party and (b) in the case of consequential damages (other than lost profits), to the extent reasonably foreseeable.

Management Equity Amount” means the amounts payable by the Company or any of its Subsidiaries under or related to any transaction bonus, change-of-control payment, phantom equity payout, “stay-put” or other similar compensatory arrangements in existence as of the Closing and that become payable as a result of the execution of any Transaction Document or in connection with the Contemplated Transactions (excluding all such payments in connection with employment terminations caused by the Buyer or any of its Affiliates (including the Company or any of its Subsidiaries) following the Closing), in each case, calculated in accordance with Schedule 1.1(a).

Material Adverse Effect” means any effect, event, change, occurrence, circumstance, state of facts or development that, individually or together with any one or more effects, events, changes, occurrences, circumstances, states of fact or developments, has had or would be reasonably expected to have a material adverse effect on: (i) the assets, properties, liabilities, business, results of operations or financial condition of the

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Company and its Subsidiaries, taken as a whole; or (ii) the ability of the Company and its Subsidiaries to perform their obligations under this Agreement or to consummate the Contemplated Transactions; provided that none of the following shall, alone or in combination, be deemed to constitute or taken into account in determining whether there has been a Material Adverse Effect pursuant to clause (i): any adverse change, effect, event, occurrence, state of facts or development to the extent attributable to (a) changes in general economic conditions affecting the U.S. economy as a whole; (b) conditions affecting the industries in which the Company or any of its Subsidiaries operate; (c) any acts of war (whether or not declared), sabotage, terrorism, military or para-military actions or the escalation of any of the foregoing (including cyberattacks not specifically directed at the Company or any of its Subsidiaries), earthquake, hurricane, tornado, or other natural disaster, epidemics, pandemics, or any outbreak of illness or other public health event (including COVID-19) or quarantine events; (d) changes in GAAP or other applicable accounting standards or any applicable Law or changes to the enforcement or application thereof; (e) any failure by the Company or any of its Subsidiaries to meet any internal or public projections or forecasts, predictions or estimates of revenues or earnings or other financial metrics; provided that any event, change, development, circumstance, fact or effect underlying such failure may be taken into account in determining whether a Material Adverse Effect has occurred or would reasonably be expected to occur (to the extent such event, change, development, circumstance, fact or effect is not otherwise excluded from this definition of Material Adverse Effect); and (f) any COVID-19 Measures (or any action taken to comply therewith), which, in the case of any of the foregoing clauses (a), (b), (c), (d) and (f) does not disproportionately affect the Company and its Subsidiaries, taken as a whole, relative to other companies in the industry in which they operate.

Mixed-Use Contract” means any Contract entered into prior to the Closing that benefits both the business of the Company and its Subsidiaries and one or more businesses of the Seller or any of its Affiliates (excluding the Company and its Subsidiaries), between (a) the Seller or any of its Affiliates, on the one hand, and (b) one or more third parties, on the other hand.

Multiemployer Plan” means any “multiemployer plan” as such term is defined in Section 3(37) or 4001(a)(3) of ERISA.

Order” means any order, decision, judgment, writ, injunction, decree, award or other determination of any Governmental Authority.

Organizational Document” means, with respect to any Person that is not a natural person, such Person’s charter, certificate or articles of incorporation or formation, bylaws, memorandum and articles of association, operating agreement, limited liability company agreement, partnership agreement, limited partnership agreement, limited liability partnership agreement or other constituent or organizational documents of such Person.

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Overdue Payable” means any payable owed by the Company or any of its Subsidiaries to the Buyer or any of its Affiliates, payment of which is greater than ninety (90) days overdue.

Owned Intellectual Property” means all Intellectual Property owned or purported to be owned by the Company or any Subsidiary of the Company (other than Company Programs and Company Projects).

Pantelion 1.0” means Pantelion, LLC, a Delaware limited liability company.

Pantelion 2.0” means Pantelion 2.0, LLC, a Delaware limited liability company.

Permits” means all permits, licenses, approvals, authorizations, consents, registrations, certificates, declarations, variances or clearances obtained, or required to be obtained, from Governmental Authorities.

Permitted Liens” means (a) Liens for current Taxes not yet due and payable or the amount or validity of which is being contested in good faith and for which appropriate reserves have been established on the Company Financial Statements in accordance with the Balance Sheet Rules; (b) mechanics’, carriers’, workers’, repairers’ and similar liens arising or incurred in the ordinary course of business for amounts which are not delinquent or which are being contested in good faith and for which appropriate reserves have been established on the Company Financial Statements in accordance with the Balance Sheet Rules; (c) zoning, entitlement, building and other land use Liens applicable to the Leased Property which are not violated by the current use, occupancy or operation of the Leased Property; (d) minor title defects and irregularities affecting any Leased Property which do not secure payment of a sum money and which do not materially impair the value, current use of such Leased Property by the Company and its Subsidiaries; (e) Liens arising in the ordinary course of business under worker’s compensation, unemployment insurance, social security, retirement and similar Laws; (f) customary Liens in favor of unions or guilds which are required by applicable collective bargaining agreements; (g) Liens customarily granted or incurred in the ordinary course of business with respect to goods provided or services rendered by laboratories and production houses, record warehouses, common carriers, landlords, warehousemen, mechanics and suppliers of materials and equipment; provided that such Liens are limited to the goods provided or to the goods relating to which services were rendered; (h) customary Liens in favor of distributors to secure their rights to enjoy their licensed rights pursuant to distribution agreements entered into in the ordinary course of business; (i) customary liens in favor of co-financiers and/or co-financiers to secure such party’s rights in co-production agreements or co-financing agreements entered into in the ordinary course of business; (j) customary Liens granted or incurred in the ordinary course of business relating to the development, production and Exploitation of film, television or other content; or (k) other non-exclusive licenses of Intellectual Property owned by the Company.

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Person” means any natural person, corporation, company, partnership, association, limited liability company, limited partnership, limited liability partnership, joint venture, business enterprise, trust or other legal entity, including any Governmental Authority.

Pre-Closing Tax Period” means any Tax period (including the pre-Closing portion of any Straddle Period) that ends on or before the Closing Date.

Related Party” means, when used to indicate a relationship with any Person, any immediate family member, Affiliate, director, officer, employee or holder of Capital Stock of or in such Person. For clarity, “Related Party” does not include any holder of Capital Stock in the ultimate parent entity of the Seller.

Release” means any release, spill, emission, leaking, pumping, pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching or migration into or through the indoor or outdoor environment.

Representative” means with respect to any Person, any director, officer, employee, agent, consultant, advisor, or other representative of such Person, including legal counsel, accountants, and financial advisors.

Required Information” means the Company’s audited financial statements, audit reports and unaudited financial statements in accordance with, and required to be filed by, Regulation S-X promulgated by the SEC by the Buyer in a Current Report on Form 8-K in connection with the Closing. For the avoidance of doubt, the “Required Information” shall include audited financial statements of the Company for the fiscal years ended March 31, 2020 and March 31, 2021.

SEC” means the U.S. Securities and Exchange Commission.

Securities Act” means the Securities Act of 1933, as amended.

Seller Fundamental Representations” means the representations and warranties set forth in Sections 4.1 (Requisite Power), 4.2 (Due Authorization), 4.6 (Title to Capital Stock) and 4.7 (Brokers).

Seller Percentage” means seventy-five percent (75%).

Seller Plan” means any Benefit Plan: (a) under which any Service Provider has any present or future right to benefits and that is maintained, sponsored or contributed to, or required to be contributed to, by the Seller or any Affiliate of the Seller (other than the Company and its Subsidiaries), or (b) with respect to which the Seller or any Affiliate of the Seller (other than the Company and its Subsidiaries) has any Liability.

Seller Transaction Expenses” means (a) any brokerage, finders’ or other advisory fees, costs, expenses, commissions or similar payments, (b) any fees, costs and expenses of counsel, accountants or other advisors or service providers, in each case

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(with respect to both clauses (a) and (b)), (i) incurred prior to Closing by the Seller or its Affiliates (excluding, for clarity, the Company and its Subsidiaries) in connection with the Contemplated Transactions and (ii) payable by the Company or any of its Subsidiaries, including any such fees and expenses of O’Melveny & Myers LLP.

Service” means the SVOD program service that is owned and operated by the Company and its Subsidiaries under the name “Pantaya”.

Service Provider” means any current or former director, officer, employee, consultant or independent contractor of the Company or any Subsidiary of the Company, excluding any employee, consultant or independent contractor engaged by the Company or any Subsidiary of the Company on a Company Program- or Company Project-specific basis in connection with the development and/or production of any Company Program or Company Project, including through a third party employee lease arrangement.

Software” means any and all (a) computer programs and other software, firmware and middleware, including software implementations of algorithms, models, and methodologies, whether in source code, object code or other form, including libraries, subroutines and other components thereof, together with input and output formats; (b) screens, user interfaces, command structures, report formats, templates, menus, buttons and icons; (c) descriptions, flow-charts, architectures, and other materials used to design, plan, organize and develop any of the foregoing; and (d) all documentation, including development, diagnostic, support, user and training documentation related to any of the foregoing.

Subsidiary” means, with respect to any specified Person, any entity of which the specified Person (either alone or through or together with any other Subsidiary of such specified Person) directly or indirectly (a) owns more than fifty percent (50%) of the economic rights or voting stock or other interests the holders of which are generally entitled to vote for the election of the board of directors or other applicable governing body of such entity or (b) controls the management; provided, that for purposes of this Agreement, Pantelion 2.0 shall be considered a Subsidiary of the Company and, for the avoidance of doubt, any representation or warranty regarding any Subsidiary of the Company as of or since any specified date shall be deemed to include Pantelion 2.0 as if it had been a Subsidiary of the Company as of or since such date.

SVOD” means the availability of multiple video programs to a subscriber by means of a point-to-point telecommunications system, originating from a distance, via a subscription video on demand service for which (a) the subscriber is charged a periodic subscription fee for the right to receive such programming, and is not charged a per-program(s) or per-exhibition(s) fee, (b) the exhibition start time of each program is at a time specified by the subscriber in his or her discretion and (c) there is no third party advertising.

Tax” means (a) any taxes, levies, fees, imposts, duties or similar charges (including any interest, fines, assessments, penalties or additions to tax imposed in

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connection therewith or with respect thereto) imposed by any Governmental Authority, including (i) taxes imposed on, or measured by, income, franchise, profits or gross receipts, (ii) ad valorem, value added, capital gains, sales, goods and services, use, real or personal property, capital stock, license, escheat, unclaimed property, branch, payroll, estimated withholding, employment, social security (or similar), unemployment, compensation, utility, severance, production, excise, stamp, occupation, premium, windfall profits, transfer and gains taxes and (iii) customs duties; and (b) any and all liability for the payment of any amounts described in clause (a) above as a result of (I) being a part of any consolidated, combined, affiliated, unitary or similar Tax group (including under Treasury Regulation Section 1.1502-6), (II) being party to any Tax sharing or allocation agreement or having any express or implied obligation to indemnify any other Person for Taxes, or (III) any successor or transferee liability.

Tax Audit Rules” means Subchapter C of Chapter 63 of the Code (Sections 6221 et seq.) and any Treasury Regulations and other guidance promulgated thereunder, and any similar state or local legislation, regulations or guidance.

Tax Return” means any and all reports, returns, declarations, claims for refund, elections, disclosures, estimates, information reports or returns or statements supplied or required to be supplied to a Governmental Authority in connection with Taxes, including any schedule or attachment thereto or amendment thereof.

Transaction Documents” means this Agreement, the Licensed Technology Agreement, the Contribution Agreement and the TSA.

Treasury Regulations” means the Treasury regulations promulgated under the Code.

TSA” means the transition services agreement, between the Company and the Seller, pursuant to which certain transitional services will be provided, in the form attached hereto as Exhibit G.

Underpayment Amount” means the amount calculated in accordance with Schedule 1.1(b). For the avoidance of doubt, notwithstanding the fact that the calculation of the “Underpayment Amount” takes into account a portion of the license fees remaining to be paid by Brendita’s Films, LLC to Pantelion 1.0 under that certain Pantelion-Pantaya SVOD License Agreement, by and between Pantelion 1.0 LLC (as licensor) and Brendita’s Films, LLC (as licensee), effective as of January 1, 2017, the full amount of all unpaid license fees under such Contract shall remain payable in accordance with terms of such Contract.

United States” means the United States of America, and its territories, districts, commonwealths and possessions, including Puerto Rico and the U.S. Virgin Islands.

Unmatched Funding Amount” means, as of the applicable date of determination, the absolute value of the amount, calculated in accordance with (including the definitions set forth in) Schedule 1.1(c), equal to (a) (i) one minus the Seller

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Percentage, multiplied by (ii) the “Current Aggregate Estimated Adjusted Net Funding” (as defined in Schedule 1.1(c)), minus the Cash Sweep Amount, plus (b) the Seller Percentage, multiplied by the “Development Funded on Behalf of Hemisphere” (as defined in Schedule 1.1(c)), minus (c) the “Hemisphere Funding to Date” (as defined in Schedule 1.1(c)).

WARN Act” means the Worker Adjustment and Retraining Notification Act (29 USC § 2101 et seq.), and any similar state, local, or non-U.S. Law or Order.

Section 1.2                  Other Capitalized Terms. The following terms shall have the meanings specified in the indicated section of this Agreement:

Term Section
Accounting Firm Section 2.3(b)
Agreement Preamble
Allocation Section 2.5
Base Purchase Price Section 2.2(a)
Buyer Preamble
Buyer Adjustment Amount Section 2.3(d)(ii)
Buyer Indemnified Parties Section 9.2
Buyer Released Parties Section 7.5(a)
Buyer Releasing Parties Section 7.5(b)
Cap Section 9.4(a)
Closing Section 3.1
Closing Date Section 3.1
Closing Statement Section 2.3(a)
Company Preamble
Company Annual Financial Statements Section 5.8(a)
Company Financial Statements Section 5.8(a)
Company Interim Financial Statements Section 5.8(a)
Company Licenses Section 5.19(c)
Continuing Employee Section 7.6(a)
Direct Claim Section 12.7
Dispute Section 2.3(b)
Distribution Rights Section 5.13(a)(i)
Estimated Adjustment Amount Section 2.2(b)
Estimated Purchase Price Section 2.2(a)
Expiration Date Section 9.1
Exploit Section 5.13(a)(iii)
Exploitation Section 5.13(a)(ii)
Exploitation Rights Section 5.13(a)(iii)
Final Adjustment Amount Section 2.3(d)
Guild Section 5.13(a)(v)
Indemnified Party Section 9.6(a)
Indemnifying Party Section 12.6(a)
Interim Balance Sheet Date Section 5.8(a)

 

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Lease Section 5.15(a)
Leased Property Section 5.15(a)
Leases Section 5.15(a)
Material Contracts Section 5.11(a)
Material Service Agreements Section 5.11(a)(xii)
Mini-Basket Section 9.4(a)
Non-Assignable Contract Section 7.11(b)(i)
Non-Party Affiliates Section 10.12
Objections Statement Section 2.3(b)
Owned Programs Section 5.13(a)(iv)
Participation Section 5.13(a)(vi)
Parties Preamble
Performing Rights Organization Section 5.13(e)(iii)
Post-Closing Claim Section 7.10
Pre-Closing Claim Section 7.10
Pre-Closing Statement Section 2.2(b)
Pre-Closing Taxes Section 8.2(a)
Purchase Price Section 2.2(a)
Reimbursement Section 9.8(a)
Release Date Section 9.1
Residual Section 5.13(a)(vii)
Restricted Period Section 7.2(a)
Restrictive Covenants Section 7.2(c)
Section 1542 Section 7.5(a)
Seller Preamble
Seller Adjustment Amount Section 2.3(d)(i)
Seller Guarantor Preamble
Seller Indemnified Parties Section 9.3
Seller Prepared Returns Section 8.1(a)
Seller Released Parties Section 7.5(b)
Seller Releasing Parties Section 7.5(a)
Straddle Period Section 8.5
Tangible Materials Section 5.13(a)(viii)
Tax Indemnified Buyer Parties Section 8.2(a)
Tax Loss Section 8.2(a)
Tax Losses Section 8.2(a)
Third Party Claim Section 9.6(a)
Threshold Amount Section 9.4(a)
Top Licensed Program Section 5.13(b)(ii)
Underlying Material Section 5.13(a)(ix)
Units Recitals

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Section 1.3                  Interpretive Provisions. Unless the express context otherwise requires:

(a)                 the words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, shall refer to this Agreement as a whole and not to any particular provision of this Agreement;

(b)                words defined in the singular shall have a comparable meaning when used in the plural, and vice versa;

(c)                 the words “Dollars” and “$” mean U.S. dollars;

(d)                references herein to a specific Section, Subsection, Recital, Schedule or Exhibit shall refer, respectively, to Sections, Subsections, Recitals, Schedules or Exhibits of this Agreement;

(e)                 wherever the word “include,” “includes” or “including” is used in this Agreement, it shall be deemed to be followed by the words “without limitation”;

(f)                  references herein to any gender shall include each other gender;

(g)                references herein to accounting terms used but not otherwise defined herein shall have the meanings given to them under GAAP;

(h)                references herein to any Person shall include such Person’s heirs, executors, personal representatives, administrators, successors and assigns; provided, however, that nothing contained in this clause (h) is intended to authorize any assignment or transfer not otherwise permitted by this Agreement;

(i)                  references herein to a Person in a particular capacity or capacities shall exclude such Person in any other capacity;

(j)                  with respect to the determination of any period of time, the word “from” means “from and including” and the words “to” and “until” each means “to but excluding”;

(k)                the word “or” shall be disjunctive but not exclusive;

(l)                  references herein to any Law shall be deemed to refer to such Law as amended, reenacted, supplemented or superseded in whole or in part and in effect from time to time and also to all rules and regulations promulgated thereunder;

(m)               references herein to any Contract mean such Contract as amended, supplemented or modified (including any waiver thereto) in accordance with the terms thereof, except that with respect to any Contract listed on any schedule hereto, all such amendments, supplements or modifications must also be listed on such schedule;

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(n)                the headings contained in this Agreement are intended solely for convenience and shall not affect the rights of the Parties;

(o)                the term “made available” (or terms with similar import) shall mean posted and made available to the Buyer in the electronic data room established at www.datasite.com on behalf of the Company in connection with the Contemplated Transactions prior to 11:59 p.m. local time in Los Angeles, California on March 29, 2021; and

(p)                if the last day for the giving of any notice or the performance of any act required or permitted under this Agreement is a day that is not a Business Day, then the time for the giving of such notice or the performance of such action shall be extended to the next succeeding Business Day.

Article II

PURCHASE AND SALE OF UNITS

Section 2.1                  Purchase and Sale of the Units and Interests. Upon the terms and subject to the conditions set forth in this Agreement, at the Closing, the Seller shall sell, assign, transfer and convey to the Buyer, free and clear of any Liens (other than restrictions on transfer arising under applicable federal and state securities Laws or under the LLC Agreement), and the Buyer shall purchase and acquire from the Seller, all of the Units, in exchange for: (a) a cash payment equal to the Estimated Purchase Price; and (b) plus (i) the Seller Adjustment Amount payable to the Seller pursuant to Section 2.3(d) or minus (ii) the Buyer Adjustment Amount owed by the Seller pursuant to Section 2.3(d) (in the case of this clause (b) if, as and when payable pursuant to Section 2.3(d)).

Section 2.2                  Calculation of Purchase Price.

(a)                 Estimated Purchase Price. The term “Estimated Purchase Price” means the amount resulting from: (i) (x) $150,000,000 (the “Base Purchase Price”) multiplied by (y) the Seller Percentage, plus (ii) the Estimated Adjustment Amount (if the Estimated Adjustment Amount is a positive number), minus (iii) the absolute value of the Estimated Adjustment Amount (if the Estimated Adjustment Amount is a negative number). The Estimated Purchase Price shall be subject to adjustment following the Closing pursuant to Section 2.3 (as so adjusted, the “Purchase Price”).

(b)                Pre-Closing Statement. No later than 11:59 p.m. local time in Los Angeles, California on March 30, 2021, the Seller shall deliver to the Buyer a certificate executed by the Seller (the “Pre-Closing Statement”) setting forth the Seller’s good faith estimates of (i) Closing Indebtedness, (ii) Seller Transaction Expenses, (iii) Closing Cash, (iv) the Unmatched Funding Amount, (v) the Management Equity Amount, (vi) the Underpayment Amount and (vii) the Adjustment Amount (clause (vii) being referred to herein as, the “Estimated Adjustment Amount”), together with supporting documentation for such estimates (including final invoices with respect to any

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Seller Transaction Expenses to be paid by the Company on behalf of the Seller at the Closing) and any additional information reasonably requested by the Buyer.

Section 2.3                  Purchase Price Adjustment.

(a)                 Closing Statements. Within ninety (90) days following the Closing Date, the Seller shall prepare and deliver to the Buyer a certificate executed by an executive officer of the Seller (the “Closing Statement”) setting forth the Seller’s good faith determination of (i) Closing Indebtedness, (ii) Seller Transaction Expenses, (iii) Closing Cash, (iv) the Unmatched Funding Amount, (v) the Management Equity Amount, (vi) the Underpayment Amount and (vii) the Adjustment Amount. During the period following the Closing Date through the final determination of the Adjustment Amount, the Buyer shall, and shall cause the Company and its Subsidiaries to, provide to the Seller and its advisors reasonable access, upon reasonable advance notice and during normal business hours, to the books and records of the Company and its Subsidiaries relevant to the determination of, and the management personnel involved in the calculation of, (i) Closing Indebtedness, (ii) Seller Transaction Expenses, (iii) Closing Cash, (iv) the Unmatched Funding Amount, (v) the Management Equity Amount, (vi) the Underpayment Amount and (vii) the Adjustment Amount. Following delivery of the Closing Statement, the Seller shall provide the Buyer with any supporting documentation for the Closing Statement that the Buyer may reasonably request. For the avoidance of doubt, if the Seller does not deliver a Closing Statement within such ninety (90) day period, then the Pre-Closing Statement shall become the Closing Statement.

(b)                Dispute Resolution. Within thirty (30) days after the Buyer’s receipt of the Closing Statement, the Buyer shall be entitled to deliver to the Seller a written statement either accepting the Closing Statement or specifying any objections thereto in reasonable detail (an “Objections Statement”). If the Buyer does not deliver an Objections Statement within such thirty (30)-day period, then the Closing Statement shall become final and binding upon all Parties. If the Buyer delivers an Objections Statement within such thirty (30)-day period, then the Seller and the Buyer shall negotiate in good faith for fifteen (15) days following the Seller’s receipt of such Objections Statement to resolve any such objections. Any such objections or discrepancies that the Buyer and the Seller are unable to resolve during such fifteen (15)-day period is referred to as a “Dispute”. After such fifteen (15)-day period, any matter set forth in the Closing Statement that is not subject to a Dispute shall become final and binding upon all Parties. If the Buyer and the Seller are unable to resolve all objections during such fifteen (15)-day period, then any Disputes, and only such Disputes, shall be resolved by Deloitte (the “Accounting Firm”). The Accounting Firm shall be instructed to resolve any Disputes in accordance with the applicable terms of this Agreement as promptly as practicable, but in any event within thirty (30) days after its appointment. Other than any Disputes, the Accounting Firm shall have no authority over any other disagreement between the Parties (including questions of Law, interpretation of contract or fraud). The Accounting Firm shall act as an expert and not as an arbitrator, and it is the intent of the Parties that the process set forth in this Section 2.3(b) and the activities of the Accounting Firm in connection herewith are not intended to be and, in fact, are not arbitration and that no formal arbitration rules shall be followed. The resolution of such

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Disputes by the Accounting Firm (i) shall be set forth in writing; (ii) shall be within the range of dispute between the Buyer and the Seller; (iii) shall be conclusive, final and binding upon all of the Parties; and (iv) shall constitute an arbitral award that is non-appealable (absent fraud or manifest error) and upon which a judgment may be rendered by a court of competent jurisdiction. Upon delivery of such resolution, the Adjustment Amount, as modified in accordance with such resolution, shall become conclusive, final and binding upon all of Parties.

(c)                 Accounting Firm Expenses. The fees, costs and expenses of the Accounting Firm shall be allocated between the Buyer, on the one hand, and the Seller, on the other hand, based upon the percentage which the portion of the Disputes not awarded to each party bears to the amount actually contested by such party. For example, if the Seller claims that the appropriate adjustments are $1,000 greater than the amount determined by the Buyer and if the Accounting Firm ultimately resolves the Dispute by awarding to the Seller $300 of the $1,000 contested, then the fees, costs and expenses of the Accounting Firm will be allocated 30% (i.e., 300  ÷  1,000) to the Buyer and 70% (i.e., 700  ÷  1,000) to the Seller.

(d)                Final Adjustment Amount. As used herein, “Final Adjustment Amount” means (i)  if the Buyer fails to deliver an Objections Statement in accordance with Section 2.3(b), the Adjustment Amount as set forth in the Closing Statement or (ii) if the Adjustment Amount is resolved by the Buyer and the Seller or by submission of any Disputes to the Accounting Firm, as contemplated by Section 2.3(b), the Adjustment Amount as so resolved. If the Final Adjustment Amount is:

(i)                  greater than the Estimated Adjustment Amount (any such excess, the “Seller Adjustment Amount”), then promptly (but in any event within five (5) Business Days following the determination of the Final Adjustment Amount), the Buyer shall deliver to the Seller the Seller Adjustment Amount by wire transfer of immediately available funds to an account or accounts designated by the Seller in writing; or

(ii)                less than the Estimated Adjustment Amount (any such shortfall, the “Buyer Adjustment Amount”), then promptly (but in any event within five (5) Business Days following the determination of the Final Adjustment Amount), the Seller shall deliver to the Buyer the Buyer Adjustment Amount by wire transfer of immediately available funds to an account or accounts designated by the Buyer in writing.

All payments made pursuant to this Section 2.3 shall be treated by all Parties for tax purposes as adjustments to the Purchase Price, unless otherwise required by Law.

Section 2.4                  Withholding. Each of the Buyer, the Company, any Subsidiary of the Company, and any of their Affiliates shall be entitled to deduct and withhold from any amounts otherwise payable pursuant to this Agreement such amounts as it is required to deduct and withhold under any provision of any Tax Law. The Buyer shall, other than in the case of payments to employees of the Company or any Subsidiary

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of the Company or the Seller’s failure to deliver the tax form set forth in Section 3.2(a)(vi), prior to making any such deduction or withholding from amounts otherwise payable pursuant to this Agreement, provide notice reasonable under the circumstances to the Seller of amounts subject to withholding and the Buyer and the Seller shall cooperate in good faith in an effort to reduce, or eliminate the necessity for, such withholding. To the extent that amounts are deducted and withheld under this Section 2.4 and paid over to the applicable Governmental Authority, such deducted and withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction and withholding was made.

Section 2.5                  Allocation of Amounts Paid By the Buyer. The Buyer and the Seller agree to determine the amount of and allocate, for federal, and applicable state and local, income Tax purposes the Purchase Price (and any other amounts treated as purchase price for Tax purposes) among the assets of the Company in a manner consistent with Section 1060 of the Code and the Treasury Regulations promulgated thereunder, and otherwise in accordance with applicable Tax Law. The allocation shall be prepared based upon a valuation report prepared by Deloitte, whose fees will be payable fifty (50%) percent by the Buyer and fifty (50%) percent by the Seller. The Buyer shall use commercially reasonable efforts to cause such accounting firm to provide the Seller with such valuation report and one (1) or more schedules allocating the Purchase Price (and other amounts treated as purchase price for Tax purposes) consistent with such valuation report (the “Allocation”) as soon as reasonably practicable, and, in any event, shall keep the Seller apprised if the Allocation process is expected to extend beyond ninety (90) days after the Closing Date. The Seller will have a period of thirty (30) days after its receipt of the allocation to review; provided, that the Allocation shall be final and binding upon the Parties to the extent the Allocation (or any component thereof) is not contested by the Seller within such period. The Parties will cooperate in good faith to resolve any potential inconsistencies in the valuation report and any schedules provided by the Buyer. The Allocation shall be adjusted to reflect any adjustments to the Purchase Price (and other items treated as purchase price for Tax purposes) made pursuant to the terms of this Agreement. The Allocation as finally determined (or as may thereafter be adjusted in accordance with this Section 2.5) shall be binding on the Buyer and the Seller, and the Buyer and the Seller agree to file all Tax Returns and determine all Taxes, in accordance therewith, except as otherwise required by a final “determination” (within the meaning of Section 1313(a) of the Code).

Article III

THE CLOSING

Section 3.1                  Closing; Closing Date. The closing of the sale and purchase of the Units contemplated by this Agreement (the “Closing”) shall take place by remote communication and electronic exchange of documents in Los Angeles, California, on the date hereof, or at such other time or date that the Seller and the Buyer may agree in writing. The date upon which the Closing occurs is referred to as the “Closing Date”.

Section 3.2                  Transactions to Be Effected at Closing.

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(a)                 At the Closing, the Seller or the Company shall deliver to the Buyer:

(i)                  an instrument of assignment with respect to the Units in the form attached hereto as Exhibit I, duly executed by the Seller;

(ii)                evidence of the making or receipt (as applicable) of all of the notices and consents listed on Schedule 3.2(a)(ii);

(iii)              evidence of the termination of each agreement set forth on Schedule 3.2(a)(iii), in each case, without any Liability to the Buyer, the Company or any of their respective Affiliates following the Closing;

(iv)               the resignation letters (or other evidence of resignation) of those directors, managers and officers of the Company or any of its Subsidiaries whose names are set forth on Schedule 3.2(a)(iv);

(v)                evidence of the repayment or other settlement by the Company of the Overdue Payables, in an amount not to exceed $2,000,000 in the aggregate;

(vi)               a fully and properly completed IRS Form W-9 and a fully and properly executed California Form 590 (Exemption Withholding Certificate), duly executed by the Seller;

(vii)             evidence of release and termination of all Liens on any assets of the Company or any of its Subsidiaries related to the JPM Credit Agreement; and

(viii)           the Transaction Documents (other than this Agreement), duly executed by each party thereto other than the Buyer and any of its Affiliates.

(b)                The Buyer shall:

(i)                  pay to the Seller, within one (1) Business Day of the Closing Date, by wire transfer of immediately available funds to a bank account designated in writing by the Seller at least two (2) Business Days before the Closing Date, an amount equal to the Estimated Purchase Price payable pursuant to Section 2.1;

(ii)                pay, or cause to be paid, within one (1) Business Day of the Closing Date, on behalf of the Company, the Seller Transaction Expenses by wire transfer of immediately available funds or as otherwise directed by the Seller; and

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(iii)              at the Closing, deliver to the Seller, the Transaction Documents (other than this Agreement) to which the Buyer or any of its Affiliates is a party, duly executed by the Buyer and any such Affiliates.

Article IV

REPRESENTATIONS AND WARRANTIES OF THE SELLER

Except as set forth in the Disclosure Schedules, the Seller represents and warrants to the Buyer as of the date hereof as follows:

Section 4.1                  Corporate Organization. The Seller has been duly organized and is validly existing and in good standing under the Laws of its jurisdiction of organization. The Seller is duly licensed or qualified and in good standing as a foreign entity in all jurisdictions in which it is required to be so licensed or qualified, except where failure to be so licensed or qualified would not have a material adverse effect on the ability of the Seller to enter into each Transaction Document to which it is a party or consummate the Contemplated Transactions.

Section 4.2                  Due Authorization. The Seller has all requisite power and authority to execute and deliver each Transaction Document to which it is a party and to consummate the Contemplated Transactions. The execution and delivery by the Seller of each Transaction Document to which it is a party and the consummation of the Contemplated Transactions has been duly and validly authorized and approved by all necessary corporate action on the part of the Seller, and no other proceeding, consent or authorization on the part of the Seller is necessary to authorize any Transaction Document to which it is a party or the Contemplated Transactions. Each Transaction Document to which the Seller is a party has been duly and validly executed and delivered by the Seller and constitutes a legal, valid and binding obligation of the Seller, enforceable against the Seller in accordance with its terms, subject to the Enforceability Exceptions.

Section 4.3                  No Conflict. The execution and delivery by the Seller of each Transaction Document to which the Seller is a party and the consummation of the Contemplated Transactions do not, except, in the case of clauses (a) or (b), as would have a material adverse effect on the ability of the Seller to enter into each Transaction Document to which it is a party or consummate the Contemplated Transactions:

(a)                 breach, violate, conflict with or result in a default under any provision of, or constitute an event that, after notice or lapse of time or both, would result in a breach or violation of or, conflict or default under, or accelerate the performance required, or result in the termination of or give any Person the right to terminate, any material Contract to which the Seller is a party or by which any of the Seller’s assets are bound;

(b)                assuming compliance with the matters addressed in Section 4.4, breach, violate, conflict with or result in a default under, any provision of, or

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constitute an event that, after notice or lapse of time or both, would result in a material breach or violation of or conflict or default under, any applicable Law or Order binding upon or applicable to the Seller; or

(c)                 violate or conflict with the Organizational Documents of the Seller.

Section 4.4                  No Authorization or Consents Required. Assuming the truth and completeness of the representations and warranties of the Buyer contained in this Agreement, no notice to, consent, approval or authorization of or filing with any Governmental Authority or other Person is required by the Seller with respect to the Seller’s execution or delivery of any Transaction Document to which the Seller is a party or the consummation of the Contemplated Transactions, other than compliance with any applicable requirements of the HSR Act.

Section 4.5                  Litigation; Orders. There are no pending or, to the Knowledge of the Seller, threatened Actions before or by any Governmental Authority against the Seller that would reasonably be expected to have, individually or in the aggregate, a material adverse effect on the ability of the Seller to enter into and perform its obligations under any Transaction Document to which it is a party. The Seller is not subject to any outstanding Order that prohibits or otherwise restricts the ability of the Seller to consummate the Contemplated Transactions.

Section 4.6                  Title to Units. The Seller holds good and valid title to the Units, free and clear of all Liens other than restrictions on transfer arising under applicable federal and state securities Laws or the LLC Agreement. Other than the Units, the Seller holds no other Capital Stock of the Company or any Subsidiary of the Company (other than Capital Stock of Subsidiaries of the Company held indirectly through the Company). At the Closing, good and valid title to the Units will pass to the Buyer, free and clear of any Liens other than other than restrictions on transfer arising under applicable federal and state securities Law or the LLC Agreement. Other than the LLC Agreement, the Seller is not a party to any Contract restricting or otherwise relating to the voting, distribution rights or disposition of such Units.

Section 4.7                  Brokers. Except for fees, costs and expenses that have been or will be paid by the Seller or its Affiliates (other than the Company and its Subsidiaries), there are no claims for brokerage or finders’ fees, commissions or similar payments in connection with the Contemplated Transactions based upon any Contract made by the Seller or any of its Affiliates.

Section 4.8                  No Other Representations or Warranties; Non-Reliance.

(a)                 Except for the express representations and warranties made by the Seller and the Company in Article IV and Article V (as and to the extent modified by the Disclosure Schedule) or any other Transaction Document, none of the Seller, the Company or any Affiliate thereof, any directors, managers, officers, employees, agents, advisors or representatives of any of the foregoing or any other Person has made or

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makes any express or implied representation or warranty of any kind or nature, whether written or oral, express or implied, including as to quality, merchantability, fitness for a purpose, condition, accuracy, omission, completeness, compliance or otherwise, regarding the Seller, the Company or any Subsidiary thereof or any of their respective Affiliates or any of their respective businesses, operations, assets, liabilities, conditions (financial or otherwise) or prospects, in connection with the Transaction Documents, the subject matter thereof (including the Contemplated Transactions), any information provided or made available in connection with the Contemplated Transactions or otherwise, and the Seller expressly disclaims any other representations or warranties.

(b)                The Seller acknowledges and agrees that it has relied solely on the results of its and its Affiliates’ and their respective representatives’ independent investigations, and none of the Seller or its Affiliates or its or their respective representatives has relied on or are relying on any representations or warranties regarding the Buyer, any Affiliate thereof or any of their respective businesses, operations, assets, liabilities, conditions (financial or otherwise) or prospects, in connection with the Transaction Documents, the subject matter thereof (including the Contemplated Transactions), any information provided or made available in connection with the Contemplated Transactions or otherwise, other than the express representations and warranties made by the Buyer in this Agreement (as and to the extent modified by the Disclosure Schedule) or any other Transaction Document.

Article V

REPRESENTATIONS AND WARRANTIES AS TO THE COMPANY

Except as set forth in the Disclosure Schedules, the Company represents and warrants to the Buyer as of the date hereof as follows (it being understood and agreed that, for clarity, no representations and warranties are provided herein with respect to ASG Latin, LLC):

Section 5.1                  Company Organization. The Company has been duly formed and is validly existing and in good standing under the Laws of the State of Delaware. The Company has the requisite power and authority to own or lease its properties and to conduct its business as it is now being conducted. The Company is duly licensed or qualified and in good standing as a foreign limited liability company or other legal entity, as applicable, in all jurisdictions in which it is required to be so licensed or qualified, except where failure to be so licensed or qualified would reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole. The Company has made available to the Buyer a true and complete copy of its Organizational Documents, each as in effect on the date hereof.

Section 5.2                  Due Authorization. The Company has all requisite power and authority to execute and deliver each Transaction Document to which it is a party and to consummate the Contemplated Transactions. The execution and delivery by the Company of each Transaction Document to which it is a party and the consummation of the Contemplated Transactions has been duly and validly authorized and approved by all

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necessary limited liability company action on the part of the Company, and no other proceeding, consent or authorization on the part of the Company is necessary to authorize any Transaction Document to which it is a party or the Contemplated Transactions. Each Transaction Document to which the Company is a party, has been duly and validly executed and delivered by the Company and constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to the Enforceability Exceptions.

Section 5.3                  No Conflict. The execution and delivery by the Company of each Transaction Document to which it is a party and the consummation of the Contemplated Transactions do not:

(a)                 except as set forth on Schedule 5.3(a), breach, violate, conflict with or result in a default under any provision of, or constitute an event that, after notice or lapse of time or both, would result in a breach or violation of or conflict or default under, or accelerate the performance required, or result in the termination of or give any Person the right to terminate, any Material Contract to which the Company, or any Subsidiary of the Company, is a party or by which the Company’s or any such Subsidiary’s assets are bound, except to the extent that any such breach, violation, conflict, or default, right of acceleration or termination, would not, individually or the in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole;

(b)                assuming compliance with the matters addressed in Section 5.4, breach, violate, conflict with or result in a default under, any provision of, or constitute an event that, after notice or lapse of time or both, would result in a material breach or violation of or conflict or default under, any applicable Law or Order binding upon or applicable to the Company or any Subsidiary of the Company, except to the extent that any such breach, violation, conflict, or default would not, individually or the in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole;

(c)                 violate or conflict with the Organizational Documents of the Company or any Subsidiary of the Company; or

(d)                result in the creation or imposition of any Lien (other than a Permitted Lien), with or without notice or lapse of time or both, on any assets of the Company or any Subsidiary of the Company, except to the extent that any such Lien would not, individually or the in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole.

Section 5.4                  No Authorization or Consents Required. Assuming the truth and completeness of the representations and warranties of the Buyer contained in this Agreement, no approval, consent, compliance, exemption, authorization or other action by, or notice to, or filing with, any Governmental Authority is necessary or required by the Company, or any Subsidiary of the Company, with respect to the execution or delivery of any Transaction Document to which it is a party or the

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consummation of the Contemplated Transactions, other than compliance with any applicable requirements of the HSR Act.

Section 5.5                  Litigation; Orders. Except as set forth on Schedule 5.5, there are no pending or, to the Knowledge of the Company, threatened material Actions by any Governmental Authority or by any other Person against the Company, or any Subsidiary of the Company, their respective properties (tangible or intangible) or any of the Company’s or any of its Subsidiaries’ officers, directors or employees in their capacities as such with respect to which the Company has indemnification obligations. None of the Company or any of its Subsidiaries is subject to any outstanding Order that restricts the operation of the business of the Company or any of its Subsidiaries in any material respect.

Section 5.6                  Capitalization. Schedule 5.6 sets forth a true and complete list of the authorized, issued and outstanding Capital Stock of the Company as of the date hereof. The issued and outstanding Capital Stock of the Company is duly authorized and validly issued. Except as set forth on Schedule 5.6, there is no other Capital Stock of the Company authorized, issued, reserved for issuance or outstanding. Except as set forth on Schedule 5.6, there are no outstanding or authorized options, warrants, convertible securities, restricted stock, restricted stock units, stock appreciation, phantom stock, profits interests, profit participation or similar rights or instruments with respect to the Capital Stock of the Company. The Company has no authorized or outstanding bonds, debentures, notes or other indebtedness the holders of which have the right to vote (or are convertible into, exchangeable for or evidencing the right to subscribe for or acquire securities having the right to vote) with the equityholders of the Company on any matter. There are no Contracts to which the Company is a party or by which the Company is bound to (a) repurchase, redeem or otherwise acquire any Capital Stock of the Company or (b) vote or dispose of any Capital Stock of the Company. Except as provided in the LLC Agreement, no Person has any right of first offer, right of first refusal or preemptive right in connection with any future offer, sale or issuance of Capital Stock of the Company.

Section 5.7                  Subsidiaries.

(a)                 Schedule 5.7(a) sets forth a true and complete list of each of the Subsidiaries of the Company and their respective jurisdictions of organization. Each Subsidiary of the Company has been duly incorporated or organized, as applicable, and is validly existing and in good standing under the laws of the jurisdiction of its organization, has all requisite power and authority to own or lease its properties and to conduct its business as it is now being conducted, in each case, except where failure to do so would not reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole. Each Subsidiary of the Company is duly licensed or qualified and is in good standing as a foreign corporation or other legal entity, as applicable, in all jurisdictions in which it is required to be so licensed or qualified, except where failure to be so licensed or qualified would reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole. All outstanding shares or other applicable form of Capital Stock of each Subsidiary of the Company are held directly by the Company or by

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one or more wholly owned Subsidiaries of the Company as set forth on Schedule 5.7(a). All of the issued and outstanding shares or other applicable form of Capital Stock of each Subsidiary of the Company are duly authorized, validly issued, fully paid and non-assessable (to the extent that such concepts are applicable) and free of any preemptive rights with respect thereto. The Company has made available to the Buyer a true and complete copy of the Organizational Documents, each as in effect on the date hereof, of each Subsidiary of the Company.

(b)                Except as set forth on Schedule 5.7(b), with respect to each Subsidiary of the Company, all Capital Stock of such Subsidiary is owned by the Company or a wholly-owned Subsidiary thereof, and there is no Capital Stock of any such Subsidiary held by another Person or reserved for issuance. There are no outstanding or authorized equity appreciation, phantom equity, profit participation or similar rights with respect to the Capital Stock of any Subsidiary of the Company. No Subsidiary of the Company has any authorized or outstanding bonds, debentures, notes or other indebtedness the holders of which have the right to vote (or are convertible into, exchangeable for, or evidencing the right to subscribe for or acquire securities having the right to vote) with the members or other equityholders of such Subsidiary on any matter. There are no Contracts to which the Company or any Subsidiary of the Company is a party or by which it is bound to (i) repurchase, redeem or otherwise acquire any Capital Stock of any Subsidiary of the Company or (ii) vote or dispose of any Capital Stock of any Subsidiary of the Company. No Person has any right of first offer, right of first refusal or preemptive right in connection with any future offer, sale or issuance of equity securities of any Subsidiary of the Company.

(c)                 Other than the Capital Stock of its Subsidiaries and a fifty percent (50%) interest in ASG Latin, LLC owned by Pantelion 2.0, the Company does not own any Capital Stock of any other Person. Neither the Company nor any Subsidiary of the Company is obligated to make any investment in or loan or capital contribution to any Person.

Section 5.8                  Financial Statements.

(a)                 Schedule 5.8(a)(i) sets forth a true and complete copy of each of (i) (A) the unaudited consolidated balance sheet as of December 31, 2020 (the “Interim Balance Sheet Date”) and the related consolidated statement of income for the nine (9)-month period then ended for the Company and its Subsidiaries, (B) the statement of income for the nine (9)-month period ended December 31, 2020 for the Company and (C) the statement of income for the nine-month period ended December 31, 2020 for Pantelion 2.0 (collectively, the “Company Interim Financial Statements”) and (ii) the unaudited consolidated balance sheet and the related consolidated statement of income for the fiscal year ended March 31, 2020 for the Company and its Subsidiaries (collectively, the “Company Annual Financial Statements” and together with the Company Interim Financial Statements, the “Company Financial Statements”). Except as set forth on Schedule 5.8(a)(ii), the Company Financial Statements (A) have been prepared in accordance with (A) GAAP, consistently applied throughout the periods indicated, (B) are consistent with the books and records of the Company and its

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Subsidiaries, and (C) present fairly in all material respects the consolidated financial condition and results of operations of the Company and its Subsidiaries as of the times and for the periods referred to therein, subject to the absence of footnote disclosures and, in the case of the Company Interim Financial Statements, changes resulting from normal immaterial year-end adjustments.

(b)                None of the Company or any of its Subsidiaries maintains any “off-balance-sheet arrangement” within the meaning of Item 303 of Regulation S-K of the SEC.

Section 5.9                  Absence of Certain Developments. Since September 30, 2020 through the date of this Agreement: (a) the Company and each Subsidiary of the Company has, in all material respects, conducted its business in the ordinary course of business consistent with past practice (other than as a result of COVID-19 or as required to comply with COVID-19 Measures), including with respect to the cash management practices and collection of payables and receivables; and (b) there has not been a Material Adverse Effect.

Section 5.10               Taxes.

(a)                 All federal income and other material Tax Returns required to be filed by the Company or any Subsidiary of the Company have been properly prepared and timely filed. All such Tax Returns (including information provided therewith or with respect thereto) are true, correct and complete in all material respects.

(b)                The Company and each Subsidiary of the Company has fully and timely paid all material Taxes owed by it (whether or not shown on any Tax Return) and has made adequate provision for any Taxes that are not yet due and payable for all taxable periods, or portions thereof, ending on or before the date hereof. The Company Financial Statements reflect an adequate reserve (excluding any reserve for deferred Taxes) for all material Taxes payable by the Company and each Subsidiary of the Company for all taxable periods and portions thereof accrued through the date of such Company Financial Statements. Since the Interim Balance Sheet Date, none of the Company nor any Subsidiary of the Company has incurred any Tax Liabilities, other than for Taxes relating to the ordinary course of business conducted by the Company and its Subsidiaries consistent with past practice.

(c)                 There are no outstanding agreements extending or waiving the statutory period of limitations applicable to any claim for, or the period for the collection, assessment or reassessment of, Taxes due from the Company or any Subsidiary of the Company for any taxable period. No request for any such waiver or extension is currently pending.

(d)                No material audit or other Action by any Governmental Authority is pending or threatened in writing with respect to any Taxes due from or with respect to the Company or any Subsidiary of the Company and no material claim has been made in writing by any Governmental Authority in a jurisdiction where the

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Company or a Subsidiary of the Company does not file a given form of Tax Return that such Person is subject to such form of Tax in that jurisdiction.

(e)                 There are no Liens for Taxes upon the assets or properties of the Company or any Subsidiary of the Company, except for Permitted Liens.

(f)                  The Company and each Subsidiary of the Company has withheld from amounts paid, accrued or owing to its present and former employees, agents, independent contractors, creditors, equityholders, nonresidents, and any other applicable Persons and has properly and timely paid to the appropriate Governmental Authority proper and accurate amounts that are required to be paid as of the Closing Date in compliance with all Tax withholding and remitting provisions of applicable Laws, or if not yet due, has properly set aside such amounts in accounts for such purposes.

(g)                None of the Company nor any Subsidiary of the Company has participated in any listed transaction within the meaning of Treasury Regulations Section 1.6011-4(b) (or any similar provision of any Tax Law).

(h)                Mucho Movies, Inc. will not be required to include in a taxable period ending after the Closing Date material amounts of taxable income attributable to income that accrued in a taxable period prior to the Closing Date but was not recognized for Tax purposes in such prior taxable period (or to exclude from taxable income in a taxable period ending after the Closing Date any material deduction the recognition of which was accelerated from such taxable period to a taxable period prior to the Closing Date) as a result of (i) the installment method of accounting, (ii) the completed contract method of accounting, (iii) the long-term contract method of accounting, (iv) Section 481 of the Code or comparable provisions of any Tax Law, or (v) prepaid amounts received prior to the Closing.

(i)                  Neither Seller nor any of its Affiliates has taken any action which would reasonably be expected to affect the status of the Company as a partnership for U.S. federal, and applicable state and local, income Tax purposes. Other than Mucho Movies, Inc., each Subsidiary of the Company is a disregarded entity for U.S. federal, and applicable state and local, income Tax purposes.

(j)                  Notwithstanding any other provision of this Agreement, the Company is not making and shall not be construed to have made any representation or warranty as to the amount or availability of any net operating loss, capital loss, tax credit, tax basis or other Tax attribute of the Company or any of its Subsidiaries as of the Closing Date with respect to the use of such Tax attributes in any Tax period beginning on or after the Closing Date.

Section 5.11               Contracts.

(a)                 Material Contracts” means any of the following types of Contract to which the Company or any Subsidiary of the Company is a party (other than the Company Plans set forth on Schedule 5.17(a)):

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(i)                  any Contract that could reasonably be anticipated to involve individual or aggregate payments or consideration paid to the Company or any of its Subsidiaries of more than $300,000 in the calendar year ending December 31, 2021 or any subsequent calendar year for goods and services furnished by the Company or any Subsidiary of the Company;

(ii)                any Contract that could reasonably be anticipated to involve individual or aggregate payments or consideration paid by the Company or any of its Subsidiaries of more than $300,000 in the calendar year ending December 31, 2021 or any subsequent calendar year for goods and services furnished to the Company or any Subsidiary of the Company;

(iii)              any Contract relating to Indebtedness of the Company, or any Subsidiary of the Company, or any Contract under which the Company, or any Subsidiary of the Company, has advanced or loaned an amount to any Person, other than trade credit or employee advances or loans in the ordinary course of business;

(iv)               any Contract relating to the title to, or ownership, lease, use, sale, exchange or transfer of, any leasehold or other interest in any real property;

(v)                any Contract under which the Company or any of its Subsidiaries would incur any change-in-control payment or similar material payment obligations to any Person by reason of any Transaction Document or the Contemplated Transactions;

(vi)               any employment, severance, retention, non-competition or separation Contract with the current Chief Executive Officer, Chief Operating Officer or Chief Financial Officer of the Company or any Subsidiary of the Company;

(vii)             any collective bargaining, labor or similar Contract entered into by the Company or any Subsidiary of the Company;

(viii)           any equity option, equity purchase, equity appreciation or other equity incentive compensation plan, or any other Contract relating to the Capital Stock of the Company or any Subsidiary of the Company;

(ix)               any Contract which purports to limit or restrict the ability of the Company or any Affiliate of the Company to enter into or engage in any market or line of business;

(x)                any joint venture, partnership, strategic alliance, limited liability company or similar Contract;

(xi)               any Contract with the Seller or a Related Party of the Seller;

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(xii)             any Contract for the sale or acquisition of a material portion of the assets or Capital Stock or businesses of (A) the Company and its Subsidiaries, taken as a whole (other than, in the case of sales of assets, in the ordinary course of business consistent with past practice) or (B) any other Person, in each case, under which there are material outstanding obligations;

(xiii)           any Contract (other than Material Service Agreements and Content Agreements) to which the Company or any Subsidiary of the Company is a party (A) pursuant to which any third party is granted a license or any right to use any Owned Intellectual Property in any material respect (other than non-exclusive licenses in the ordinary course of business), (B) pursuant to which any third party grants the Company or any Subsidiary a right or license to use, any Intellectual Property in any material respect (other than generally commercially available off-the-shelf software or software-as-a-service licenses, in each case, that provide for one-time or annual license, maintenance, support and other fees of $100,000 or less) or (C) contains a settlement, covenant-not-to-sue or agreement not to assert with respect to any Intellectual Property;

(xiv)           any Content Agreement (A) under which it would reasonably be expected that the Company or any of its Subsidiaries would make payments in excess of $300,000 or receive payments in excess of $300,000, in each case, per year during any year of the remaining term of such Content Agreement, or (B) related to or concerning one or more Top Licensed Programs (collectively, the “Material Service Agreements”); or

(xv)             any Contract involving any resolution or settlement of any actual or threatened Action, which imposes material continuing obligations on, the Company, or any Subsidiary of the Company.

(b)                The Company has made available a true and complete copy of each Material Contract. Each Material Contract is a legal, valid and binding obligation of the Company or its Subsidiary party thereto, is in full force and effect and is enforceable against the Company or such Subsidiary, and to the Knowledge of the Company, against the other parties thereto, in each case, subject to the Enforceability Exceptions. Neither the Company nor any Subsidiary of the Company is in material breach, violation of or default under any Material Contract. To the Knowledge of the Company, no event has occurred that, with notice or lapse of time or both, would constitute such a material breach or violation or default by the Company or any Subsidiary of the Company under any Material Contract or the other parties thereto.

Section 5.12               Service Operations.

(a)                 Except as set forth on Schedule 5.12(a), the Company or a Subsidiary of the Company is the owner and operator of the Service. Except for the Contemplated Transactions, other than in the ordinary course of business or in accordance with the Company’s business plan, neither the Company nor any of its Subsidiaries has assigned or delegated, or has agreed to assign or delegate, any of its

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rights or obligations under the Content Agreements with respect to the Service or assigned or delegated, or agreed to assign or delegate, any of its rights or obligations with respect to management or operation of the Service.

(b)                Except as set forth on Schedule 5.12(b), (x) the Company, any Subsidiary of the Company and, to the Company’s Knowledge, each other Person that is a party to any Material Service Agreement are and have been in material compliance with all applicable terms and requirements of each Material Service Agreement, including with regard to any payments required to be made under such Material Service Agreement, and (y) neither the Company nor any Subsidiary of the Company (i) is the subject of an audit by any counterparty to a Material Service Agreement or (ii) has received a written request from any counterparty to a Material Service Agreement to conduct such an audit. Neither the Company nor any of its Subsidiaries have received any written notice of the intention of any counterparty to terminate or not renew any Material Service Agreement or decrease materially or limit materially its relationship with the Company or any of its Subsidiaries.

Section 5.13               Programming.

(a)                 As used herein:

(i)                  Distribution Rights” means any of the following rights, collectively, with respect to a Company Program, in each case, subject to any limitations, restrictions or conditions on or to the Exploitation thereof contained in agreements with any third party (including talent, rights holders and Guilds), which has been delivered to or otherwise made available to the Buyer in the books and records of the Company:

(A)               the rights to release, distribute, and Exploit (as defined herein) such Company Program, including in connection with the marketing, distribution and Exploitation of such Company Program from time to time;

(B)               the rights to use and to authorize others to use the title of such Company Program for purposes of advertising and publicizing such Company Program from time to time in connection with the marketing, distribution and Exploitation of such Company Program;

(C)               the rights: (1) to publish and license and authorize others to publish in any language, in any media, synopses, summaries, adaptations, resumes and stories of and excerpts from such Company Program and from any Underlying Material (as defined herein); (2) to use and authorize others to use the name, voice and likeness (and any simulation or reproduction thereof) of any person appearing in or rendering services in connection with such Company Program; (3) to Exploit and authorize others to Exploit in any language by any media, including radio and television, excerpts and clips from such Company

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Program and from any Underlying Material; and (4) to use and authorize others to use the rights described above and the title of the applicable Company Program in the manufacture and distribution of t-shirts, sweatshirts, posters and postcards and other items for publicity and promotional purposes, and not for sale;

(D)               the rights to use and authorize others to use all Tangible Materials relating to such Company Program in connection with the Exploitation of such Company Program to the extent necessary to Exploit rights in such Company Program; and

(E)                the rights to receive copyright revenues, and the rights to receive or to arrange for the collection of copyright revenues resulting from the secondary transmission or retransmission of such Company Program.

(ii)                Exploitation” means, with respect to a Company Program, any of the following: the exhibition, distribution, transmission, display, performance, dissemination, publication, promotion, publicizing, advertising, reproduction, rental, lease, license, sublicense, transfer, disposing of, commercializing, marketing, usage, trading in, turning to account, dealing with and in and otherwise exploiting such Company Program, and/or the allied, ancillary and subsidiary rights related thereto, in any and all media now known or hereinafter devised. “Exploit” means to cause the Exploitation.

(iii)              Exploitation Rights” means, with respect to a Company Program, the right to Exploit such Company Program and Tangible Materials relating thereto, including Distribution Rights.

(iv)               Owned Programs” means all Company Programs with respect to which the Company or a Subsidiary owns the underlying copyright therein.

(v)                Guild” means the Screen Actors Guild, the Directors Guild of America, the Writers Guild of America, I.A.T.S.E. or any other trade or labor organization, collective bargaining entity or union, domestic or foreign, which bargains on behalf of its members with third parties in order to determine wages, hours, rules, working conditions and the like.

(vi)               Participation” means any contractually required amounts payable to or on behalf of any third party involved in the development and/or production of, and/or respecting any Underlying Materials related to, a Company Program, including all third parties who rendered services or granted rights in connection with such Company Program, which are (A) a contingent amount determined in whole or in part based on the financial performance from the Exploitation of such Company Program, including amounts contingent upon or determined by box office receipts, gross receipts, net receipts, or a percentage

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of such gross receipts or net receipts however defined, denominated or calculated, or are otherwise determined by reference to the performance of such Company Program however measured or determined (including, without limitation, number of views), and are payable in a fixed or allocable amount or as a percentage of such receipts; and/or (B) payable in a fixed amount upon the occurrence of specified events in relation to the Exploitation of the Company Program such as receipt of an award or the attainment of a specified level of receipts or contingent proceeds from, or other financial performance, or other performance (including, without limitation, number of views), of the Exploitation of a Company Program. For the avoidance of doubt “Participations” does not include: (x) fees and payments of any kind of the type which are or will be included in a Company Program’s budget; (y) amounts required to be remitted by the Company to a co-financier of a Company Program as such co-financier’s applicable share of the gross receipts of such Company Program; or (z) Residuals or other amounts that may become payable to any Guild in connection with the Exploitation of a Company Program.

(vii)             Residual” means any amount required to be paid pursuant to a collective bargaining agreement with a union, Guild or other collective bargaining unit related to the Exploitation of any Company Program.

(viii)           Tangible Materials” means, with respect to any Company Program, collectively, all physical embodiments of, or relating to, such Company Program or its elements in whatever state of completion, wherever located (including in any film laboratory or storage facility owned or controlled by Company or any other Person), in any video, audio or other format, including: (A) all positive, negative, fine grain and answer prints and duplicating negatives; (B) all exposed or developed film, pre-print materials, subtitles, special effects, cutouts, stock footage, outtakes, tabs and trims, master tapes and other duplicating materials of any kind, all various language dubbed and titled versions, prints and negatives of stills, trailers and television spots; (C) tapes, discs, hard drives, computer memory, or other electronic media of any nature; (D) all sound and music tracks, audio and video recordings of all types and gauges (whether analog, digital or otherwise) in all languages; (E) electronic and/or digital copies of any of the foregoing stored on any media; and (F) any other similar materials required, used or held for use in connection with the Exploitation of the Company Programs.

(ix)               Underlying Material” means, with respect to any Company Program, literary, musical, dramatic or other works, screenplays, stories, adaptations, scripts, treatments, formats, bibles, scenarios, characters, titles, and any and all other literary or dramatic materials of any kind upon which such Company Program is based, in whole or in part.

(b)                Ownership & Control.

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(i)                  Schedule 5.13(b)(i) sets forth a true, correct and complete list of (i) all Owned Programs; and (ii) all Company Projects. Except as set forth on Schedule 5.13(b)(i), the Company or a Subsidiary thereof has the right to Exploit the Owned Programs in any and all media in which such Owned Program is currently being Exploited by the Company or any of its Subsidiaries.

(ii)                Schedule 5.3(b)(ii) sets forth a true, correct and complete list of each Licensed Program, and identifies therein which Licensed Programs are the top twenty (20) Licensed Programs as determined by measuring the number of streaming views for each such Licensed Program during the calendar year 2020 (each, a “Top Licensed Program”); for the avoidance of doubt, for purposes of the definition of “Top Licensed Program”, all streamed views of each episode of a given Licensed Program shall be aggregated for purposes of counting the number of streamed views of such Licensed Program. Except as set forth on Schedule 5.3(b)(ii), the Exploitation Rights controlled by the Company with respect to each Licensed Program include SVOD rights for the United States during the term of the Company’s license period for the applicable Licensed Program.

(c)                 Copyright Registration. The Company has registered in the United States copyright rights in each Owned Program that has completed production and been delivered to its domestic distributor, if and to the extent all copyright rights therein are exclusively owned by the Company and to the extent of the Company’s applicable registrable copyright interests therein.

(d)                Participations. Except as set forth Schedule 5.13(d), in connection with the Company Programs, to the Knowledge of the Company, the Company does not have any obligations with respect to Participations and has not assumed any obligations with respect to Participations.

(e)                 Residuals. Except as set forth on Schedule 5.13(e), the Company has no obligation to pay any Residuals and has not assumed any obligation to pay any Residuals with respect to the Exploitation of the Top Licensed Programs. With respect to each Owned Program, either (i) the Company has complied with all of its material reporting obligations under any applicable collective bargaining agreements with any union or Guild and has paid or caused to be paid all amounts due and payable by the Company under all applicable collective bargaining agreements with any union or Guild by reason of any past or current exhibitions or Exploitations; or (ii) there are no Guild relationships or Contracts governing or respecting the Owned Programs. Except as set forth in Schedule 5.13(e), there are no claims or audits that have been asserted or threatened in writing by any Guild or union with respect to the Owned Programs or, to the Knowledge of the Company, the Top Licensed Programs.

(f)                  No Infringement.

(i)                  The licensor of each Licensed Program has represented and warranted to the Company in substance that: (A) such Licensed

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Program does not libel, defame or violate the rights of privacy or publicity of any Person; and (B) the Company’s Exploitation of its rights with respect to such Licensed Programs does not infringe or otherwise violate any Intellectual Property rights of any Person. The Company has not received written notice of any such claim thereof nor has the Company made any claims of infringement of any Intellectual Property in any Licensed Program.

(ii)                No Owned Program libels, defames or violates the rights of privacy or publicity of any Person. No Owned Program infringes or otherwise violates any Intellectual Property rights of any Person to the extent of Company’s commercial Exploitation thereof. The Company has not received written notice of any such claim thereof nor has the Company made any claims of infringement of any Intellectual Property in any Licensed Program.

(iii)              Music Rights. All of the musical compositions and sound recordings thereof embodied in the Owned Programs that have been completed and delivered to the domestic distributor have been cleared for synchronization, reproduction and use in the Owned Programs in all media now known or hereafter devised. All of the public performance rights with respect to the music contained in each such Owned Program are (A) controlled by the American Society of Composers, Authors and Publishers, Broadcast Music Inc., SESAC or other applicable music performing rights organization (each, a “Performing Rights Organization”); (B) in the public domain; or (C) duly licensed or otherwise owned by the Company with sufficient rights to permit its public performance in connection with the exhibition of each such Owned Program in all media and by those means in which each such Owned Program is currently commercially Exploited. The Company has valid and enforceable agreements with the American Society of Composers, Authors and Publishers, Broadcast Music Inc., SESAC and all other applicable music performing rights organizations that cover the licensing of public performance rights in the United States. To the Knowledge of the Company, there are no material amounts accrued and currently due by the Company in respect of Contracts with any Performing Rights Organization.

(g)                Credits. The credits contained in each Owned Program are (and, with respect to each Top Licensed Program, the licensor thereof has represented and warranted to the Company that such credits are): (i) are complete and accurate in all material respects; (ii) do not omit any Person entitled by a Material Contract to any credit for providing services in connection with such Top Licensed Program or Owned Program; and (iii) comply with all Guild or other Contract obligations of the Company to third parties who rendered services in connection with such Top Licensed Program or Owned Program; provided that the foregoing representations shall only apply to Company Programs that have been completed and commercially released. The Company has not received written notice of any omissions, inaccuracies or non-compliance relating to any such credits in the Licensed Programs, except as would not reasonably be expected to result in material Liability.

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(h)                Tangible Materials. To the extent the Company owns or controls Tangible Materials used in connection with the Exploitation of an Owned Program or a Licensed Program, such Tangible Materials are stored and maintained directly by the Company, or on its behalf, in customary storage facilities or laboratories in accordance with customary industry practice for the use and preservation of such materials. To the extent any such Tangible Materials are not owned completely or directly by the Company, the Company has or has the right to customary access to such materials sufficient to Exploit such Tangible Materials in the manner and to the extent currently Exploited.

(i)                  Actions. There are no pending or threatened Action(s) in writing in any jurisdiction contesting, challenging the use, ownership, validity or enforceability by the Company of any material Intellectual Property right in any Company Program held for use in the Service.

(j)                  Compliance. All Owned Programs have been developed and produced, and have been Exploited by the Company, in all material respects in accordance with (i) all applicable Contracts, (ii) all applicable Laws and (iii) any applicable collective bargaining, union or guild agreement

(k)                Good Standing. The Company and its Subsidiaries are in good standing and are not in default of any material obligations under all applicable union, Guild or collective bargaining agreements, rules and regulations;

(l)                  Insurance. Each Owned Program is covered by adequate and customary insurance, in accordance with standard custom and practice in the entertainment industry, and the Company or a Subsidiary, as applicable, are a named insured under such policies.

(m)               Disclaimers. With respect to any Owned Program in any stage of production as of the date hereof, neither the Seller nor the Company makes any representation or warranty regarding (i) any materials added to or included in such Owned Program after the Closing Date or (ii) the production or Exploitation of any such Owned Program after the Closing Date. Furthermore, neither the Seller nor the Company makes any representation or warranty regarding any Licensed Programs that were licensed by the Company or any of its Subsidiaries from the Buyer or any of its Affiliates.

Section 5.14               Intellectual Property.

(a)                 Schedule 5.14(a) sets forth a true and complete list of all Owned Intellectual Property that is registered, issued or the subject of a pending application. All of the registrations, issuances and applications of Owned Intellectual Property set forth on Schedule 5.14(a) are valid and (excluding applications) in full force and effect and all application, maintenance, renewal filings and fee payments related thereto have been timely made. The Company and its Subsidiaries own and possesses all

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right, title and interest in and to the Owned Intellectual Property free and clear of all Liens other than Permitted Liens.

(b)                The Company and its Subsidiaries have taken commercially reasonable actions to maintain and protect the secrecy and confidentiality of their Trade Secrets and confidential information.

(c)                 Neither the Owned Intellectual Property nor the conduct of the business of the Company and its Subsidiaries misappropriates, infringes or otherwise violates any Intellectual Property or other proprietary rights of any other Person in any manner that would be material to the Company and its Subsidiaries, taken as a whole; provided, however, the foregoing shall not apply to Owned Programs and Licensed Programs, which are covered under Section 5.13 of this Agreement. There is no Action pending or, to the Knowledge of the Company, threatened that alleges any such misappropriation, infringement or violation. The Company and its Subsidiaries have not received any written charge, complaint, claim, demand or notice alleging any such infringement, misappropriation or violation by the Company or any of its Subsidiaries. To the Knowledge of the Company, no Person is infringing or otherwise violating any Owned Intellectual Property in any material respect.

(d)                The Company and its Subsidiaries have a privacy policy regarding the collection, protection, storage and use of personal information in its and its Subsidiaries’ business and have at all times complied in all material respects with and are currently in compliance in all material respects with such privacy policy and with all applicable Laws, Orders and contractual requirements relating thereto. The execution, delivery and performance of the Transaction Documents and the consummation of the Contemplated Transactions do not violate such privacy policies as they currently exist or as they existed at any time during which personal information was collected or obtained by the Company or its Subsidiaries and, upon Closing, the Company and its Subsidiaries will continue to have the right to use such personal information on the same or substantially similar terms and conditions as they had immediately prior to the Closing. No Actions are pending or, to the Knowledge of the Company, threatened, against the Company or any Subsidiary of the Company relating to the collection or use of personal information.

(e)                 No Software material to the business of the Company and its Subsidiaries, taken as a whole, is included, in whole or in part, in Owned Intellectual Property.

(f)                  To the Knowledge of the Company, the IT Assets operate properly in conformance with their documentation in all material respects and without any material defect, material unavailability or material error. To the Knowledge of the Company, the material IT Assets owned by, licensed to or leased to the Company or any Subsidiary of the Company will continue to operate and be accessible to users immediately following the Closing in substantially the same manner in all material respects as they operated and were accessible to users immediately prior to the Closing, except to the extent subject to or provided for in the TSA, the Licensed Technology

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Agreement or any Mixed-Use Contracts. The Company and its Subsidiaries have taken commercially reasonable actions to protect the confidentiality, integrity and security of the IT Assets and all information (including personal information) stored therein or transmitted thereby from loss, unauthorized access or other misuse. To the Knowledge of the Company, there have been no material failures, material unauthorized access or material security breaches of any IT Assets or data in the possession or control of the Company or any Subsidiary of the Company (including any event that, under applicable Law, would require the Company or any Subsidiary of the Company to provide notice of such event to applicable data subjects).

Section 5.15               Property.

(a)                 Schedule  5.15(a) sets forth a true and complete list of all Contracts under which the Company or any Subsidiary of the Company leases, subleases, licenses or otherwise occupies real property and all amendments thereto, extensions, renewals and guaranties thereof and other agreements relating thereto (each, a “Lease” and collectively, the “Leases”, and the real property demised under any Lease, a “Leased Property”). Each Lease (i) is a valid and binding obligation of the Company or applicable Subsidiary, (ii) is in full force and effect and is enforceable against the Company or applicable Subsidiary and, to the Knowledge of the Company, the other parties thereto, subject to the Enforceability Exceptions, and (iii) neither the Company or the applicable Subsidiary nor, to the Knowledge of the Company, any other party thereto is in material breach, violation or default under any Lease. Except as set forth in Schedule 5.15(a), neither the Company nor any Subsidiary of the Company has leased, subleased, or otherwise granted to any Person the right to use or occupy any Leased Property or any portion thereof, assigned any of the Leases or conveyed all or any portion of the Company or applicable Subsidiary’s interest in any of the Leases or the premises demised thereunder.

(b)                Neither the Company nor any of its Subsidiaries owns any real property. The Leased Property constitutes all of the real property currently used in the operation of the respective businesses of the Company and its Subsidiaries.

(c)                 There is no pending or, to the Knowledge of the Company, threatened, appropriation, condemnation or similar Action related to the Leased Property or any part thereof or of any sale or other disposition of the Leased Property or any portion thereof in lieu of condemnation.

Section 5.16               Labor Matters.

(a)                 Except as would not, individually or in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, the Company and its Subsidiaries are in compliance with all applicable Labor Laws.

(b)                No current Service Provider is (i) covered by a collective bargaining or any other labor-related Contract with any labor union, works council or

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labor organization, nor is any such Contract currently being negotiated or (ii) a leased employee or an outsourced employee. There is no pending or, to the Knowledge of the Company, threatened, nor has there been in the three (3) years preceding the date hereof, any organized effort or demand for recognition or certification or attempt to organize employees of the Company or any Subsidiary of the Company by any labor organization. There is no pending nor, to the Knowledge of the Company, threatened labor strike, walk-out, work stoppage, slowdown or lockout with respect to employees of the Company or any Subsidiary of the Company, and no labor strike, walk-out, work stoppage, slowdown or lockout has occurred in the three (3) years preceding the date hereof.

(c)                 Except as would not, individually or in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, neither the Company nor any Subsidiary of the Company is the subject of, nor is there pending or, to the Knowledge of the Company, threatened, any Action asserting that the Company or any Subsidiary of the Company has committed an unfair labor practice, act of discrimination, or other similar complaints with respect to any Service Provider.

(d)                As of the date hereof, no senior management employee of the Company or any Subsidiary of the Company has given notice, whether written or oral, to the Company or any Subsidiary of the Company that any such employee intends to terminate his or her employment with the Company or the applicable Subsidiary. To the Knowledge of the Company, no current Service Provider is in any material respect in violation of any term of any employment contract, non-disclosure agreement or noncompetition agreement.

(e)                 Neither the Company nor any Subsidiary of the Company has incurred any Liability under the WARN Act that remains unpaid or unsatisfied and no other activity that would give rise to a notice obligation under the WARN Act has been planned, contemplated or announced.

(f)                  Except as would not, individually or in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, employees of the Company or any Subsidiary of the Company who are not citizens or permanent residents of the country in which they work have provided documentation to the Company reflecting their authorization under applicable United States or non-U.S. immigration Laws to work in his or her current position for the Company and its Subsidiaries.

(g)                Except as would not, individually or in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, neither the Company nor any Subsidiary of the Company has any Liability with respect to the misclassification of any Person as an independent contractor rather than as an employee, or as an “exempt” employee rather than a “non-exempt” employee (within the meaning of the Fair Labor Standards Act of 1938, as amended), or with respect to such Person’s status as a leased employee.

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Section 5.17               Employee Benefit Plans.

(a)                 Schedule 5.17(a) sets forth a true and complete list of each material Company Plan and Seller Plan, and denotes with an (*) each Seller Plan.

(b)                With respect to each Company Plan, the Company has made available to the Buyer a true and complete copy (or, to the extent no such copy exists, an accurate description) thereof and, to the extent applicable, (i) the most recent documents constituting the Company Plan and any amendments thereto, (ii) each related trust agreement or other funding instrument, (iii) the most recent IRS determination or opinion letter, if applicable, (iv) the most recent summary plan description, summary of material modifications and all other material written communications (or a description of all material oral communications) by the Company or any Subsidiary of the Company to its Service Providers concerning the extent of the benefits provided under a Company Plan, (v) a summary of any proposed amendments or changes anticipated to be made to the Company Plan at any time within the twelve (12) months immediately following the date of this Agreement, (vi) for the three (3) most recent years (A) Forms 5500 and attached schedules, (B) annual financial statements and (C) actuarial valuation reports and (vii) for the three (3) most recent years, all correspondence with the IRS, the DOL, the PBGC, the SEC or any other Governmental Authority regarding the operation or the administration of the Company Plan.

(c)                 Except as would not, individually or in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole: (i) each Company Plan has been established, administered, maintained, funded and operated in compliance with its terms and the applicable provisions of ERISA, the Code and all other applicable Laws, (ii) no Service Provider has been improperly excluded from participation in any Company Plan and (iii) each Company Plan subject to Section 409A of the Code is in compliance in form and operation with Section 409A of the Code and the applicable guidance and regulations thereunder. Except as would not, individually or in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole, no event has occurred and no condition exists with respect to any Company Plan that would subject the Company or any Subsidiary of the Company to any Tax, fine, Lien, penalty or other Liability imposed by ERISA, the Code or other applicable Law and Orders.

(d)                No Company Plan is intended to be qualified within the meaning of Section 401(a) of the Code.

(e)                 None of the Company, any Subsidiary of the Company or their ERISA Affiliates sponsors, maintains, contributes to or has any Liability in respect of, or has in the past six (6) years sponsored, maintained, contributed to or had any Liability in respect of, (i) any “defined benefit plan” (as defined in Section 3(35) of ERISA) or plan subject to Section 412 of the Code or Section 302 of ERISA, (ii) a “multiple employer welfare arrangement” as defined in Section 3(40) of ERISA, (iii) a Multiemployer Plan, or (iv) any post-employment health, medical or life insurance for

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any Service Provider (except as may be required under COBRA or at the sole expense of the Service Provider).

(f)                  Except as set forth in Schedule 5.17(f), none of the execution and delivery of any Transaction Document or the consummation of the Contemplated Transactions would reasonably be expected to (either alone or in combination with another event) result in (i) severance pay or any increase in severance pay upon any termination of employment after the date of this Agreement, (ii) any payment, compensation or benefit becoming due, or increase in the amount of any payment, compensation or benefit due, to any Service Provider, (iii) the acceleration of the time of payment or vesting or result in any funding (through a grantor trust or otherwise) of compensation or benefits (including Liability for any gross up, make whole or other payment as a result of imposition of Taxes under Section 4999 or Section 280G of the Code), or (iv) the payment of any amount under any Company Plan or other arrangement that is effective prior to the Closing (excluding, for the avoidance of doubt, any such arrangement adopted by the Buyer or any of its Affiliates) that could, individually or in combination with any other such payment, constitute an “excess parachute payment,” as defined in Section 280G(b)(1) of the Code.

(g)                With respect to each Company Plan (i) no Actions (other than routine claims for benefits) are pending or, to the Knowledge of the Company, threatened, (ii) no facts or circumstances exist that would reasonably be expected to give rise to any such Actions, (iii) no audit or other Action by the DOL, the IRS or any other Governmental Authority is pending or, to the Knowledge of the Company, threatened (including any routine requests for information from the PBGC), and (iv) there are no audits or Actions initiated pursuant to the Employee Plans Compliance Resolution System or similar proceedings pending with the IRS or DOL with respect to any Company Plan.

Section 5.18               Insurance. Schedule 5.18 sets forth a true and complete list of all insurance policies maintained by the Seller or an Affiliate thereof with respect to the Company and its Subsidiaries (the “Insurance Policies”). The Insurance Policies are valid, binding and in full force and effect, subject to the Enforceability Exceptions, and have terms and conditions, including amounts and scope of coverage, that are customary for companies in the same or similar lines of business and of similar size and financial condition. There is no Action pending under any of the Insurance Policies as to which the Company’s or any Subsidiary of the Company’s coverage has been questioned, denied or disputed by the underwriters of the Insurance Policies that would, individually or in the aggregate, reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole.

Section 5.19               Compliance with Laws.

(a)                 The Company and each Subsidiary of the Company are, and at all times in the past three (3) years have been, in compliance with all applicable Laws and Orders, except where the failure to comply, individually or in the aggregate, has not been and would not reasonably be expected to be material to the Company and its

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Subsidiaries, taken as a whole. Neither the Company nor any Subsidiary of the Company has received written notice from any Governmental Authority that such Person is not in compliance with any applicable Law or Order except for such non-compliance as, individually or in the aggregate, has not been and would not reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole.

(b)                The Company and each Subsidiary of the Company are, and at all times in the past three (3) years have been, in compliance in all material respects with the United States Foreign Corrupt Practices Act of 1977 and any other applicable anti-corruption or anti-bribery Laws.

(c)                 Except as set forth on Schedule 5.19(c), the Company and each Subsidiary of the Company has obtained and maintains all of the material licenses from Governmental Authorities necessary to permit such Company or such Subsidiary to own, operate, use and maintain its assets in the manner in which they are now owned, operated, used and maintained and to conduct its business as currently conducted (collectively, “Company Licenses”), except where the failure to obtain and maintain such licenses, has not been and would not reasonably be expected to be material to the Company and its Subsidiaries, taken as a whole. There are no Actions pending or, to the Knowledge of the Company, threatened that would reasonably to be expected to result in the termination, revocation, suspension or restriction of any Company License or the imposition of any material fine, penalty, sanction or other Liability for violation of any Law or Order relating to any Company License.

Section 5.20               Environmental Matters.

(a)                 No notice, notification, demand, request for information, citation, summons or order has been received, no complaint has been filed, no penalty has been assessed and no Action or Order is pending or, to the Knowledge of the Company, threatened by any Person with respect to any matters relating to the Company or any Subsidiary of the Company relating to or arising out of any Environmental Law or Environmental Permit, in each case, except as would not reasonably be expected to result in material Liability under Environmental Laws.

(b)                There are no material Liabilities of or relating to the Company or any Subsidiary of the Company of any kind whatsoever, including those relating to off-site disposal of or human exposure to Hazardous Substances, arising under or relating to any Environmental Law or Environmental Permit.

(c)                 The Company and its Subsidiaries as well as their business, assets and operations are and have at all times in the past three (3) years been in compliance with all applicable Environmental Laws and the Company and its Subsidiaries have obtained and are in compliance with all Environmental Permits required for their respective business, assets and operations, in each case, except as would not reasonably be expected to result in material Liability under Environmental Laws.

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(d)                (i) There has been no Release of Hazardous Substances with respect to any real property owned, operated or leased by the Company or any Subsidiary of the Company and (ii) neither Company nor any Subsidiary of the Company has generated, treated, stored, Released, transported or arranged for transportation or disposal of any Hazardous Substance at any location, in each case, except as would not reasonably be expected to result in material Liability under Environmental Laws.

(e)                 There has been no material environmental investigation, study, audit, test, review or other analysis conducted within the past three (3) years in relation to the current or prior business of the Company or any Subsidiary of the Company or any property or facility now or previously owned, leased or operated by the Company or any Subsidiary of the Company that is in the possession or control of the Seller, the Company or any Subsidiary of the Company that has not been made available to the Buyer.

Section 5.21               Affiliate Transactions(a). Except as set forth on Schedule 5.21, neither the Seller nor any Related Party of the Seller (other than Pantelion 1.0) (a) is a party to any Contract with the Company or any Subsidiary of the Company, and (b) has any interest in any material property, asset or right that is owned or used by the Company or any Subsidiary of the Company (other than by virtue of the Seller’s ownership of membership interests in the Company).

Section 5.22               Sufficiency of Assets. Subject to the TSA and the Licensed Technology Agreement and taking into account the provisions of Section 7.11 with respect to any Mixed Use Contract or Non-Assignable Contract, the assets, properties and rights owned or licensed by the Company and its Subsidiaries constitute all of the assets, properties and rights that are necessary or required to continue to conduct the business of the Company and its Subsidiaries immediately following the Closing in substantially the same manner in all material respects as it is conducted as of immediately prior to the Closing.

Section 5.23               Brokers.(a) Except for the fees, costs and expenses set forth on Schedule 5.23, there are no claims for brokerage or finders’ fees, commissions or similar payments in connection with the Contemplated Transactions based upon any Contract made by or on behalf of the Company or any Subsidiary of the Company.

Article VI

REPRESENTATIONS AND WARRANTIES OF THE BUYER

Except as set forth in the Disclosure Schedules, the Buyer represents and warrants to the Seller as of the date hereof as follows:

Section 6.1                  Corporate Organization. The Buyer has been duly organized and is validly existing and in good standing under the Laws of its jurisdiction of organization. The Buyer is duly licensed or qualified and in good standing as a foreign entity in all jurisdictions in which it is required to be so licensed or qualified, except

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where failure to be so licensed or qualified would not have a material adverse effect on the ability of the Buyer to enter into each Transaction Document to which it is a party or consummate the Contemplated Transactions.

Section 6.2                  Due Authorization. The Buyer has all requisite power and authority to execute and deliver each Transaction Document to which it is a party and to consummate the Contemplated Transactions. The execution and delivery by the Buyer of each Transaction Document to which it is a party and the consummation of the Contemplated Transactions has been duly and validly authorized and approved by all necessary corporate or similar action on the part of the Buyer, and no other proceeding, consent or authorization on the part of the Buyer is necessary to authorize any Transaction Document to which it is a party or the Contemplated Transactions. Each Transaction Document to which the Buyer is a party, has been duly and validly executed and delivered by the Buyer and constitutes a legal, valid and binding obligation of the Buyer, enforceable against the Buyer in accordance with its terms, subject to the Enforceability Exceptions.

Section 6.3                  No Conflict. The execution and delivery by the Buyer of each Transaction Document to which it is a party and the consummation of the Contemplated Transactions do not, except, in the case of clauses (a) or (b), as would have a material adverse effect on the ability of the Buyer to enter into each Transaction Document to which it is a party or consummate the Contemplated Transactions:

(a)                 breach, violate, conflict with or result in a default under any provision of, or constitute an event that, after notice or lapse of time or both, would result in a breach or violation of or conflict or default under, or accelerate the performance required, or result in the termination of or give any Person the right to terminate, any material Contract to which the Buyer is a party or by which any of the Buyer’s assets are bound;

(b)                assuming compliance with the matters addressed in Section 6.4, breach, violate, conflict with or result in a default under, any provision of, or constitute an event that, after notice or lapse of time or both, would result in a material breach or violation of or, conflict or default under, any applicable Law or Order binding upon or applicable to the Buyer; or

(c)                 violate or conflict with the Organizational Documents of the Buyer.

Section 6.4                  No Authorization or Consents Required. Assuming the truth and completeness of the representations and warranties of the Seller and the Company contained in this Agreement, no notice to, consent, approval or authorization of or filing with any Governmental Authority or other Person is required by the Buyer with respect to the Buyer’s execution or delivery of any Transaction Document to which it is a party or the consummation of the Contemplated Transactions, other than compliance with any applicable requirements of the HSR Act.

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Section 6.5                  Litigation; Orders. There are no pending or, to the Knowledge of the Buyer, threatened Actions before or by any Governmental Authority against the Buyer that would reasonably be expected to have, individually or in the aggregate, a material adverse effect on the ability of the Buyer to enter into and perform its obligations under any Transaction Document to which it is a party. The Buyer is not subject to any outstanding Order that prohibits or otherwise restricts the ability of the Buyer to consummate the Contemplated Transactions.

Section 6.6                  Investment Purpose. The Buyer is acquiring the Units for its own account with the present intention of holding such securities for investment purposes and not with a view to, or for sale in connection with, any distribution of such securities in violation of any federal or state securities Laws.

Section 6.7                  Brokers. Except for fees, costs and expenses that have been or will be paid by the Buyer or its Affiliates (other than the Company and its Subsidiaries), there are no claims for brokerage or finders’ fees, commissions or similar payments in connection with the Contemplated Transactions based upon any Contract made by the Buyer or any of its Affiliates.

Section 6.8                  No Other Representations or Warranties; Non-Reliance.

(a)                 Except for the express representations and warranties made by the Buyer in this Article VI (as and to the extent modified by the Disclosure Schedule) or any other Transaction Document, none of the Buyer, any Affiliate thereof, any directors, managers, officers, employees, agents, advisors or representatives of any of the foregoing or any other Person has made or makes any express or implied representation or warranty of any kind or nature, whether written or oral, express or implied, including as to quality, merchantability, fitness for a purpose, condition, accuracy, omission, completeness, compliance or otherwise, regarding the Buyer, any Affiliate thereof or any of their respective businesses, operations, assets, liabilities, conditions (financial or otherwise) or prospects, in connection with the Transaction Documents, the subject matter thereof (including the Contemplated Transactions), any information provided or made available in connection with the Contemplated Transactions or otherwise, and the Buyer expressly disclaims any other representations or warranties.

(b)                The Buyer acknowledges and agrees that it has relied solely on the results of its and its Affiliates’ and their respective representatives’ independent investigations, and none of the Buyer or its Affiliates or its or their respective representatives has relied on or are relying on any representations or warranties regarding the Seller, the Company or any Subsidiary thereof or any of their respective Affiliates or any of their respective businesses, operations, assets, liabilities, conditions (financial or otherwise) or prospects, in connection with the Transaction Documents, the subject matter thereof (including the Contemplated Transactions), any information provided or made available in connection with the Contemplated Transactions or otherwise, other than the express representations and warranties made by the Seller and the Company in this Agreement (as and to the extent modified by the Disclosure Schedule) or any other Transaction Document.

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Article VII

COVENANTS

Section 7.1                  Confidentiality.

(a)                 After the Closing, the Seller shall hold and shall cause its Affiliates to hold, and shall use its reasonable efforts to cause its and its Affiliates’ respective officers, directors, managers, employees, accountants, counsel, consultants, advisors and agents to hold, in confidence and not disclose, except to the extent that such disclosure is required by Law or Order, court process or the rules or regulations of the SEC or any U.S. or non-U.S. national securities exchange, all confidential information concerning the Company or any Subsidiary of the Company, except for information that (i) becomes available in the public domain other than through a breach of this Section 7.1(a) by the Seller or its Affiliates; (ii) becomes available to the Seller or its Affiliates after the Closing on a non-confidential basis from a source (other than those related to the Seller’s prior ownership of the Company) that is not and not subject to a confidentiality obligation; or (iii) is independently developed after the Closing by or on behalf of the Seller or its Affiliates without use or reference to the confidential information. The obligation of the Seller to hold and to cause its Affiliates to hold any such information and documents in confidence shall be satisfied if it exercises at least the same degree of care with respect to such information as it would take to preserve the confidentiality of its own similar information.

(b)                After the Closing, each of the Buyer and the Seller shall hold and shall cause its Affiliates to hold, and shall use its reasonable efforts to cause its and its Affiliates’ respective officers, directors, managers, employees, accountants, counsel, consultants, advisors and agents to hold, in confidence and not disclose, except to the extent that such disclosure is required by Law or Order, court process or the rules or regulations of the SEC or any U.S. or non-U.S. national securities exchange, all of the terms of this Agreement and the other Transaction Documents and the Contemplated Transactions.

Section 7.2                  Non-Competition; Non-Solicitation 

(a)                 In order for the Buyer to have and enjoy the full benefit of the business of the Company and its Subsidiaries, and as a material inducement to the Buyer to enter into this Agreement (without such inducement the Buyer would not have entered into this Agreement), for a period of eighteen (18) months commencing on the Closing Date (the “Restricted Period”; provided, that, with respect to the Buyer or the Seller, the Restricted Period shall be tolled during (and shall be deemed automatically extended by) any period in which such Party is in violation of any of the provisions of this Section 7.2), the Seller shall not, directly or indirectly (whether by itself, through an Affiliate, in partnership or conjunction with, or as a manager, member, owner, consultant or agent of, any other Person):

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(i)                  launch, or agree to manage or operate, in any case, whether alone or in conjunction with one or more third parties, a Competing Service, acquire a twenty-five percent (25%) or greater financial or voting interest in a Competing Business or acquire a controlling interest (financial or otherwise) in, or the right to control the management and operation of, a Competing Business;

(ii)                (x) solicit, entice, encourage or intentionally influence, or attempt to solicit, entice, encourage or influence, any employee of the Company or any of its Subsidiaries to resign or leave the employ of the Company or any of its Subsidiaries, (y) otherwise hire, employ, engage or contract any such employee to perform services other than for the benefit of the Company or any of its Subsidiaries or (z) hire, employ, engage or contract any Person set forth on Schedule 7.2(a)(ii) to perform services other than for the benefit of the Company or any of its Subsidiaries; or

(iii)              solicit, entice, encourage or intentionally influence, or attempt to solicit, entice, encourage or intentionally influence, any supplier, distributor, content provider or other business associate of the Company or any of its Subsidiaries (including any Person who has been a business associate of the Company at any time during the period of twelve (12) months before the Closing) anywhere in the United States to alter, reduce or terminate its business relationship with the Company or any of its Subsidiaries; provided, however, that none of the following activities shall constitute a violation of Section 7.2(a)(iii): (A) entering into, extending, renewing, amending or replacing any agreement or arrangement with any existing customer, vendor, supplier, distributor, content provider or other business associate of the Seller or any of its Affiliates, provided that this exception shall not apply to any such agreement or arrangement that is primarily intended to alter, reduce or terminate (as distinguished from an agreement or arrangement that has the effect, but not the primary intent, of altering, reducing or resulting in the termination of) such business associate’s business relationship with the Company or any of its Subsidiaries; or (B) any action by the Seller or any of its Affiliates taken in the ordinary course of business in connection with obtaining or seeking to obtain from any third party vendor, supplier, distributor or content provider any products, materials, services or rights intended for use in the Seller’s (or any of its Affiliates’) businesses, provided that this exception shall not apply to any such action that is primarily intended to alter, reduce or terminate (as distinguished from an agreement or arrangement that has the effect, but not the primary intent, of altering, reducing or resulting in the termination of) such business associate’s business relationship with the Company or any of its Subsidiaries.

Notwithstanding anything in Section 7.2(a), none of the following activities shall constitute a violation of Section 7.2(a): (i) extending, renewing, amending or replacing the Existing LGE-Derbez Agreement or entering into, extending, renewing, amending or replacing any other agreement or arrangement with Eugenio Derbez, 3Pas Studios, LLC or Derbez Entertainment Inc. or any of their respective Affiliates; (ii) soliciting or hiring

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any Person, other than those set forth on Schedule 7.2(a)(ii), who contacts the Seller or any of its Affiliates on his or her own initiative without any direct or indirect solicitation by or encouragement from the Seller or any of its Affiliates; or (iii) making general solicitations for employment (including through the use of advertisements in the media and solicitations placed by recruiting firms or similar organizations) not specifically directed at individual prospective employees, consultants or independent contractors or soliciting or hiring any person responding to such general solicitations, other than those set forth on Schedule 7.2(a)(ii). In addition, notwithstanding anything in Section 7.2(a), none of the following shall constitute a violation of Section 7.2(a): (x) any action or inaction by the Seller or any of its Affiliates expressly permitted under any existing co-development or co-production, distribution or license agreement between the Seller or any of its Affiliates, on the one hand, and the Company or any of its Subsidiaries, on the other hand; (y) the alteration, reduction or termination by any supplier, distributor, content provider or other business associate of the Company or any of its Subsidiaries of its business relationship with the Company or any of its Subsidiaries on its own initiative or by virtue of the terms of any existing Contract as a result of the Company and its Subsidiaries ceasing to be Affiliates of the Seller or any of its Affiliates following the consummation of the Contemplated Transactions; or (z) the acquisition by the Seller or any of its Affiliates of any Person that is engaged in a Competing Business, as long as such Person derives less than twenty-five percent (25%) of its revenue and enterprise value from such Competing Business.

(b)                As a material inducement to the Seller to enter into this Agreement (without such inducement the Seller would not have entered into this Agreement), during the Restricted Period, the Buyer shall not, directly or indirectly (whether by itself, through an Affiliate (including the Company or any of its Subsidiaries), in partnership or conjunction with, or as a manager, member, owner, consultant or agent of, any other Person), solicit, entice, encourage or intentionally influence, or attempt to solicit, entice, encourage or influence, any employee of the Seller or any of its Affiliates to resign or leave the employ of the Seller or any of its Affiliates or otherwise hire, employ, engage or contract any such employee to perform services other than for the benefit of the Seller or any of its Affiliates. Notwithstanding anything in Section 7.2(b), none of the following activities shall constitute a violation of Section 7.2(b): (i) soliciting or hiring any person who contacts the Buyer or any of its Affiliates on his or her own initiative without any direct or indirect solicitation by or encouragement from Buyer or any of its Affiliates; or (ii) making general solicitations for employment (including through the use of advertisements in the media and solicitations placed by recruiting firms or similar organizations) not specifically directed at individual prospective employees, consultants or independent contractors or soliciting or hiring any person responding to such general solicitations.

(c)                 Notwithstanding anything to the contrary set forth herein (including Section 10.8), in the event of a breach of any of the provisions of Section 7.2(a) or Section 7.2(b) (the “Restrictive Covenants”):

(i)                  each of (A) the Buyer and its Affiliates (including the Company) and (B) the Seller and its Affiliates, respectively, shall have the

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right and remedy, without regard to any other available remedy, to (x) have the Restrictive Covenants specifically enforced by any court of competent jurisdiction and (y) have issued an injunction restraining any such breach without posting of a bond; it being understood that any breach of any of the Restrictive Covenants by the other Party or any of its Affiliates would cause irreparable and material harm to such Party and its Affiliates, the amount of which cannot be readily determined and as to which neither such Party nor any of its Affiliates will have any adequate remedy at law or in damages;

(ii)                it is the desire and intent of the Parties that the Restrictive Covenants be enforced to the fullest extent permissible under the Laws, Orders and public policies applied in each jurisdiction in which enforcement is sought and if any Restrictive Covenant shall be adjudicated finally to be invalid or unenforceable, such Restrictive Covenant shall be deemed amended to the extent necessary in order that such provision be valid and enforceable, the remainder of such Restrictive Covenant shall not thereby be affected and shall be given full effect without regard to invalid portions and such amendment shall apply only with respect to the operation of the Restrictive Covenant in the particular jurisdiction in which such adjudication is made; and

(d)                The Parties acknowledge and agree that the Restrictive Covenants are necessary for the protection and preservation of the value and the goodwill of the businesses of each of (i) the Buyer and its Affiliates (including the Company) and (ii) the Seller and its Affiliates and are reasonable and valid in geographical and temporal scope and in all other respects.

Section 7.3                  Public Announcements. No Party will issue or cause the publication of any press release or other public announcement with respect to this Agreement or any of the other Transaction Documents (including any of the terms hereof or thereof) or the Contemplated Transactions without the prior written consent of the other Parties; provided, however, that nothing herein will prohibit any Party from issuing or causing publication of any such press release or public announcement to the extent that such disclosure is required by Law or Order, court process or the rules or regulations of any U.S. or non-U.S. national securities exchange or U.S. or non-U.S. national securities quotation system, upon advice of counsel, in which case, the Party making such determination will use reasonable efforts to allow the other Parties reasonable time to comment on such release or announcement in advance of its issuance or publication.

Section 7.4                  Cooperation with SEC Filings. In connection with the Buyer’s preparation of any filing required to be made with the SEC under the Exchange Act or the Securities Act, if reasonably requested by the Buyer, the Seller shall, at the Buyer’s sole cost and expense:

(a)                 (i) use commercially reasonable efforts to provide, as promptly as reasonably practicable, but in any event the Seller shall provide within 45 days of Closing, the Required Information (preliminary unaudited and without footnote disclosures), including any update to the financial statements provided in

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Schedule 5.8(a)(i) as may be reasonably required so that such Required Information would be for the fiscal periods required under Rule 3-05 Regulation S-X promulgated by the SEC, if required for inclusion in any filing of the Buyer to be made with the SEC under the Exchange Act or the Securities Act, and (ii) use best efforts to provide, as promptly as reasonably practicable, but in any event the Seller shall provide within 65 days of Closing, the Required Information, including any update to the financial statements provided in Schedule 5.8(a)(i) and any updates to the preliminary, unaudited financial information provided pursuant to clause (i) above, as may be reasonably required so that such Required Information would be for the fiscal periods required under Rule 3-05 Regulation S-X promulgated by the SEC, if required for inclusion in any filing of the Buyer to be made with the SEC under the Exchange Act or the Securities Act;

(b)                use commercially reasonable efforts to cause the Company’s independent auditors to provide, consistent with customary practice, consents to the use of their reports in any Current Reports on Form 8-K, any registration statement or other documents to be filed by the Buyer with the SEC that may require such a consent as well as comfort regarding such reports;

(c)                 use best efforts to assist, as promptly as reasonably practicable, but in any event the Seller shall assist within 65 days of Closing, the Buyer in connection with the preparation of pro forma financial information and pro forma financial statements if required by Article 11 of Regulation S-X promulgated by the SEC (which includes preparing, and providing to the Buyer to the extent available to the Seller and assuming such information is not otherwise in the possession of the Buyer or any of its Affiliates (including the Company and its Subsidiaries), financial information through the Closing Date in accordance with GAAP to the extent reasonably necessary to permit the Buyer to prepare its pro forma financial information in accordance with Article 11 of Regulation S-X), including using best efforts to cause the Company’s independent auditors to reasonably assist and advise the Company in its preparation of the pro forma financial information in connection with the Buyer’s Current Report on Form 8-K to be filed with the SEC after the Closing;

(d)                use commercially reasonable efforts to provide, as promptly as reasonably practicable (i) a preliminary draft of the unaudited consolidated balance sheet of the Company as of and the related unaudited consolidated income statement of the Company for the fiscal quarter ended March 31, 2021, (ii) the unaudited consolidated balance sheet of the Company as of and the related consolidated income statement of the Company for the fiscal quarter ended March 31, 2021 and (iii) unaudited consolidated income statements of the Company, prepared in accordance with GAAP (but without the footnote disclosures), for each fiscal quarter beginning from the fiscal quarter ended March 31, 2020 and ending with the fiscal quarter ended March 31, 2021, but in any event the Seller shall provide: (A) the unaudited consolidated balance sheet of the Company as of March 31, 2021 and the consolidated income statements of the Company for the fiscal quarters ended March 31, 2020 and March 31, 2021, by April 21, 2021; and (B) the consolidated income statements of the Company for the fiscal quarters ended June 30, 2020, September 30, 2020 and December 31, 2020, by June 24, 2021;

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(e)                 use commercially reasonable efforts to inform the Buyer, as promptly as reasonably practicable, after the Seller has knowledge of any facts that would be reasonably expected to require the restatement of any financial statements of the Company; and

(f)                  use commercially reasonable efforts to take, as promptly as reasonably practicable following such request, any reasonably requested action with respect to the Required Information in connection with any Current Reports on Form 8-K, any registration statement or other documents to be filed by the Buyer with the SEC that may be required to include such Required Information.

The Buyer shall, and shall cause the Company and its Subsidiaries, to reasonably cooperate with the Seller in connection with the foregoing, including, upon reasonable request by the Seller, making available to the Seller and its Affiliates, the books and records of the Company and its Subsidiaries and any employees of the Buyer, the Company or any Subsidiary of the Company as may be reasonably required in connection with the foregoing. For the avoidance of doubt, each of the financial statements referenced in Section 7.4(d) shall be a consolidated financial statement of the Company and its Subsidiaries (including Pantelion 2.0) with eliminations.

Section 7.5                  Release.

(a)                 Effective upon the Closing, the Seller, on behalf of itself and its Affiliates and each of their respective executors, representatives, successors and assigns (collectively, the “Seller Releasing Parties”), unconditionally and irrevocably waives, releases and forever discharges the Buyer, the Company, the Subsidiaries of the Company and each of their respective Affiliates (collectively, the “Buyer Released Parties”), of and from any and all claims that the Seller Releasing Parties, or any of them, now have, ever had, or at the Closing may have, or hereafter can, shall or may have, against the Buyer Released Parties, or any of them, for, upon or by reason of any matter, cause or thing whatsoever, from the beginning of time through the Closing Date, arising out of or relating to the organization, management or operation of the businesses of the Company and its Subsidiaries, except for, and the release contained herein shall not extend or apply to, (i) any rights arising under this Agreement, any other Transaction Document or any commercial Contract or (ii) any exculpation, expense advancement, reimbursement or indemnification rights of any of the Seller Releasing Parties in its capacity as officer, manager or director pursuant to (A) the Organizational Documents of the Company or any of its Subsidiaries as in effect immediately prior to the Closing or (B) any insurance policy maintained by or on behalf of any of the Seller Releasing Parties with respect to the Company or any of its Subsidiaries. The Seller, on behalf of each of the Seller Releasing Parties, hereby agrees that if any Seller Releasing Party hereafter commences, joins in, or in any manner seeks relief through any suit arising out of, based upon, or relating to any claim released hereunder, or in any manner asserts against any Buyer Released Party any claim released hereunder, then the Seller Releasing Parties will pay to such Buyer Released Party, in addition to all other direct or indirect Losses suffered by such Buyer Released Party as a result of such suit or claim, all attorneys’ fees incurred in defending or otherwise responding to such suit or claim. The Seller, for itself

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and on behalf of each of the other Seller Releasing Parties, hereby represents and warrants that they have read and are familiar with the provisions of Section 1542 of the Civil Code of the State of California (“Section 1542”), which states that:

“A general release does not extend to claimS that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.”

In furtherance of the foregoing, being aware of Section 1542, effective as of the Closing, the Seller, for itself and on behalf of each of the other Seller Releasing Parties, hereby: (i) expressly agrees that this Section 7.5(a) shall be effective as a bar to the claims released hereunder and that this Section 7.5(a) shall be given full force and effect; and (ii) expressly waives and relinquishes any rights they may have under Section 1542, as well as under any other statute or common law principle of similar effect, with respect to the claims released hereunder.

(b)                Effective upon the Closing, the Buyer, on behalf of itself and its Affiliates (including the Company and its Subsidiaries) and each of their respective executors, representatives, successors and assigns (collectively, the “Buyer Releasing Parties”), unconditionally and irrevocably waives, releases and forever discharges the Seller and each of its Affiliates (collectively, the “Seller Released Parties”), of and from any and all claims that the Buyer Releasing Parties, or any of them, now have, ever had, or at the Closing may have, or hereafter can, shall or may have, against the Seller Released Parties, or any of them, for, upon or by reason of any matter, cause or thing whatsoever, from the beginning of time through the Closing Date, arising out of or relating to the organization, management or operation of the businesses of the Company and its Subsidiaries, except for, and the release contained herein shall not extend or apply to, (i) any rights arising under this Agreement, any other Transaction Document or any commercial Contract or (ii) any exculpation, expense advancement, reimbursement or indemnification rights of any of the Buyer Releasing Parties in its capacity as officer, manager or director pursuant to (A) the Organizational Documents of the Company or any of its Subsidiaries as in effect immediately prior to the Closing or (B) any insurance policy maintained by or on behalf of any of the Buyer Releasing Parties with respect to the Company or any of its Subsidiaries. The Buyer, on behalf of each of the Buyer Releasing Parties, hereby agrees that if any Buyer Releasing Party hereafter commences, joins in, or in any manner seeks relief through any suit arising out of, based upon, or relating to any claim released hereunder, or in any manner asserts against any Seller Released Party any claim released hereunder, then the Buyer Releasing Parties will pay to such Seller Released Party, in addition to all other direct or indirect Losses suffered by such Seller Released Party as a result of such suit or claim, all attorneys’ fees incurred in defending or otherwise responding to such suit or claim. The Buyer, for itself and on behalf of each of the other Buyer Releasing Parties, hereby represents and warrants that they have read and are familiar with the provisions of Section 1542, which states that:

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“A general release does not extend to claimS that the creditor or releasing party does not know or suspect to exist in his or her favor at the time of executing the release and that, if known by him or her, would have materially affected his or her settlement with the debtor or released party.”

In furtherance of the foregoing, being aware of Section 1542, effective as of the Closing, the Buyer, for itself and on behalf of each of the other Buyer Releasing Parties, hereby: (i) expressly agrees that this Section 7.5(b) shall be effective as a bar to the claims released hereunder and that this Section 7.5(b) shall be given full force and effect; and (ii) expressly waives and relinquishes any rights they may have under Section 1542, as well as under any other statute or common law principle of similar effect, with respect to the claims released hereunder.

Section 7.6                  Employee Matters.

(a)                 The Buyer agrees that each employee of the Company or any of its Subsidiaries who continues employment with the Buyer, the Company or any of their respective Affiliates after the Closing Date (a “Continuing Employee”) shall be provided, for a period extending until the earlier of the termination of such Continuing Employee’s employment with such entities or the end of the Buyer’s 2021 fiscal year: (i) base salary or wage rate (as applicable), commission and target annual cash incentive opportunity that are not less than the base salary or wage rate (as applicable), commission and target annual cash incentive opportunity provided to such Continuing Employee immediately before the Closing; (ii) employee benefits that are substantially comparable in the aggregate to the benefits provided to the Continuing Employees immediately prior to the Closing (but excluding benefits under equity or equity-based incentive plans, retention or change in control plans or agreements, deferred compensation plans, defined benefit pension plans and retiree health or welfare plans); and (iii) severance protections that are substantially comparable to those provided to such Continuing Employee immediately prior to the Closing. Nothing in this Section 7.6(a) (x) shall require the Buyer, the Company or any of their respective Affiliates to continue to employ any particular employee following the Closing Date or (y) shall be construed as amending (or prohibiting any Party from amending or terminating) any Benefit Plan.

(b)                Notwithstanding anything to the contrary herein, the Seller shall ensure that the Buyer and its Affiliates (including, after the Closing, the Company and its Subsidiaries) shall not have any Liability under or with respect to any Seller Plan.

Section 7.7                  Termination of LLC Agreement. Effective as of the Closing, the LLC Agreement is hereby terminated in full (and no party thereto shall have any obligation or liability under or in respect thereof), except for Sections 8.2 (Exculpation and Indemnification) and 8.3 (Notice; Procedures) thereof, which shall survive and remain in full force and effect.

Section 7.8                  Pantelion 2.0. Prior to the Closing, pursuant to the Contribution Agreement, the Seller shall have contributed, or caused to be contributed,

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all of the issued and outstanding equity interests of Pantelion 2.0 to the Company free and clear of all Liens other than restrictions on transfer arising under applicable federal and state securities Laws.

Section 7.9                  Wrong Pocket. Subject to Section 7.11(b), if, following the Closing, either the Buyer or the Seller discovers that it or any of its Subsidiaries possesses any right or other asset, or is liable for any liability that, in the case of the Seller, relates exclusively to the business of the Company and its Subsidiaries or, in the case of the Buyer, relates exclusively to the business of the Seller and its Affiliates (excluding the Company and its Subsidiaries), such Party shall, and shall cause its Subsidiaries to, transfer or cause to be transferred such right, asset or liability to such other Party or its Subsidiary, and such Party or its Subsidiary shall accept and assume any such right, asset or liability, as applicable, for no additional consideration other than as previously paid as provided in this Agreement. If, following the Closing, either the Buyer or the Seller or any of its Subsidiaries receives any payments due to another Party or a Subsidiary thereof in respect of the rights, assets or liabilities allocated to such other Party or Subsidiary thereof pursuant to this Agreement, then such first Party shall promptly remit (or cause to be promptly remitted), or deliver (or cause to be delivered), such payments to the appropriate Party or a Subsidiary thereof.

Section 7.10               Insurance. From and after the Closing, in the event of any claim asserted against the Company or any of its Subsidiaries after the Closing arising out of any occurrence, Liability or Loss taking place prior to the Closing (a “Post-Closing Claim”) the Company and each of its Subsidiaries shall be entitled to access coverage under any occurrence-based Insurance Policy under which coverage is available for such Post-Closing Claim. In the event of any claim asserted against the Company or any of its Subsidiaries prior to the Closing arising out of any occurrence, Liability or Loss taking place prior to the Closing for which the Company or any of its Subsidiaries has sought to access coverage under any occurrence-based or claims-based Insurance Policy (a “Pre-Closing Claim”) the Company and each of its Subsidiaries shall be entitled to continue to access coverage under any occurrence-based or claims-based Insurance Policy under which coverage is available for such Pre-Closing Claim. From and after the Closing, in the event of any such Post-Closing Claim, the Company shall provide a written request to the Seller, accompanied by all information reasonably required to be included with such Post-Closing Claim. The Seller shall, following receipt of such request and information, reasonably cooperate with the Company to promptly submit the applicable Post-Closing Claim under the applicable occurrence-based Insurance Policy. The Seller thereafter shall use its commercially reasonable efforts to permit the Company or its Subsidiary to pursue, and assist the Company or its Subsidiary in pursuing, any available coverage for such Post-Closing Claim under the applicable occurrence-based Insurance Policy, at the cost and expense of the Buyer. The Seller shall use its commercially reasonable efforts to permit the Company or its Subsidiary to pursue, and assist the Company or its Subsidiary in pursuing, any available coverage for any Pre-Closing Claim under the applicable Insurance Policy, at the cost and expense of the Buyer. Any insurance proceeds received by the Seller or any of its Affiliates in respect of a Pre-Closing Claim or Post-Closing Claim shall be promptly transmitted to the Buyer.

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Section 7.11               Mixed-Use Contracts; Non-Assignable Contracts.

(a)                 Mixed-Use Contracts. The Parties acknowledge that the Seller and/or its Affiliates (excluding the Company and its Subsidiaries) are parties to certain Mixed-Use Contracts. Subject to applicable Law and Section 7.11(b), unless the Seller or its applicable Affiliate and the Buyer otherwise agree or as otherwise provided for in the TSA (as may be amended from time to time in accordance therewith) or the Licensed Technology Agreement (as may be amended from time to time in accordance therewith), the Seller or its applicable Affiliate and the Buyer shall cooperate with each other and use their respective commercially reasonable efforts following the Closing to cause each material Mixed-Use Contract to be apportioned (including by way of entering into a new Contract or amendment, or splitting or assigning the applicable rights and obligations) between the Seller or its applicable Affiliate and the Buyer, such that the Seller or its applicable Affiliate will assume all of the rights and obligations under such Mixed-Use Contract to the extent relating to the business of the Seller and its Affiliates other than the business of the Company and its Subsidiaries, on the one hand, and the Buyer will assume all of the rights and obligations under such Mixed-Use Contract to the extent relating to the business of the Company and its Subsidiaries, on the other hand. From and after the Closing, (i) the Buyer shall reimburse, indemnify and hold harmless the Seller and its Affiliates against all Losses incurred by such Person, as applicable, arising from or relating to the portion of any Mixed-Use Contract apportioned to the business of the Company and its Subsidiaries and (ii) Seller shall reimburse, indemnify and hold harmless the Buyer and its Affiliates against all Losses incurred by such Person arising from or relating to the portion of any Mixed-Use Contract not apportioned to the business of the Company and its Subsidiaries.

(b)                Non-Assignable Contracts.

(i)                  For purposes of this Agreement, any Contract (including any portion of any Mixed-Use Contract pursuant to Section 7.11(a)) or any claim, right or benefit arising thereunder or resulting therefrom, if an attempted transfer or assignment thereof, directly or indirectly, without the consent, waiver or approval of any third party thereto, would constitute a breach or other contravention thereof, be ineffective with respect to either party thereto (including by the exercise of any termination right thereunder) or violate any applicable Law or any such Contract referred to in this Section 7.11(b)(i), or otherwise are subject to a counterparty termination right as a result of such assignment or transfer shall be deemed a “Non-Assignable Contract”.

(ii)                With respect to (x) any Contract to which Section 7.9 applies or (y) any Mixed-Use Contract to which Section 7.11(a) applies and, in the case of either clause (x) or clause (y), which is a Non-Assignable Contract, and, with respect to any such Non-Assignable Contract, any claim, right or benefit arising thereunder or resulting therefrom, the Seller and the Buyer will cooperate and use their respective commercially reasonable efforts to obtain as expeditiously as possible after the date hereof (A) the written consent, waiver or approval of the other party or parties to such Non-Assignable Contract

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for (as applicable) (I) the assignment of the applicable rights and obligations thereunder, (II) the entry into a new Contract or amendment between the Buyer or an Affiliate thereof or (III) the continued operation of the existing Contract, notwithstanding the fact that the Company or its Subsidiary ceases to be Affiliates of the Seller or any of its Affiliates following the consummation of the Contemplated Transactions, or (B) written confirmation from the other party or parties to such Non-Assignable Contract mutually satisfactory in form and substance to the Seller and the Buyer, that such consent, waiver or approval is not required.

(c)                 If any consent, waiver, approval or confirmation has not been obtained with respect to (x) any Contract to which Section 7.9 applies or (y) any Mixed-Use Contract to which Section 7.11(a) applies (without duplication or limitation of Section 7.11(a)) and, in the case of either clause (x) or clause (y), which is a Non-Assignable Contract to be assigned to the Buyer as of the Closing, then until the earlier of (i) such time as such consent, waiver, confirmation, novation or approval is obtained and (ii) the expiration date of the then current term of such Non-Assignable Contract, the Seller and the Buyer will use their commercially reasonable efforts (including the dedication of resources thereto) to establish an agency relationship or other similar arrangement reasonably satisfactory to the Seller and the Buyer under which the Buyer would obtain, to the fullest extent practicable and not prohibited by any applicable Law, the claims, rights and benefits and assume the corresponding Liabilities and obligations thereunder in accordance with this Agreement (including by means of any subcontracting, sublicensing or subleasing arrangement). In such event, with respect to the period after the Closing, (A) the Seller will promptly pay, assign and remit to the Buyer when received all monies and other consideration received by it or an Affiliate under any applicable Non-Assignable Contract or any claim, right or benefit arising thereunder not transferred pursuant to this Section 7.11 and (B) the Buyer will promptly pay, perform or discharge when due any Liability arising thereunder. The Buyer shall indemnify Seller Indemnified Parties for all Losses arising out of any actions (or omissions to act) of the Seller or any of its Affiliates taken at the express direction of the Buyer or any of its Subsidiaries with respect to such Non-Assignable Contract.

Section 7.12               Certain Matters(a). The Buyer and the Seller covenant and agree to comply with the provisions set forth on Schedule 7.12.

Article VIII

TAX MATTERS

Section 8.1                  Tax Preparation of Tax Returns and Payment of Taxes.

(a)                 The Seller shall prepare, or cause to be prepared, and shall timely file, or cause to be filed, at the cost and expense of the Company, all Tax Returns of the Company and each of its Subsidiaries due (after taking into account all appropriate extensions) on or prior to the Closing Date (the “Seller Prepared Returns”). Such Seller Prepared Returns shall be prepared on a basis consistent with existing procedures and practices and

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accounting methods, unless otherwise required by Law, and the preparation thereof shall continue to be subject in all respects to the terms of the LLC Agreement. All Taxes reflected on such Tax Returns (other than any such Tax Returns that are Flow-Through Tax Returns) shall be paid by the Company or its Subsidiaries.

(b)                The Seller shall prepare (or cause to be prepared), and timely file, at the cost and expense of the Company, all Tax Returns of the Company and each of its Subsidiaries with respect to any Pre-Closing Tax Period (other than a Straddle Period) required to be filed with any Governmental Authority after the Closing Date. The Seller shall prepare such Tax Returns on a basis consistent with existing procedures and practices and accounting methods, unless otherwise required by Law. With respect to any Income Tax Returns to be filed with respect to any Pre-Closing Tax Period, at least thirty (30) calendar days prior to the due date of any such Tax Returns (accounting for all applicable extensions), the Seller shall submit such Tax Returns to the Buyer for review. If the Buyer disputes any item on any such Income Tax Return, it shall notify the Seller of such disputed item (or items) and the basis for its objection within ten (10) calendar days of receipt. The Buyer and the Seller shall negotiate in good faith to resolve any timely noticed dispute prior to the date on which the relevant Income Tax Return is required to be filed. If the parties cannot resolve any timely disputed item, the item in question shall promptly be referred to, and resolved by, the Accounting Firm in accordance with the procedures set forth in Section 2.3(b) and Section 2.3(c), applied mutatis mutandis. If such timely disputed item has not been resolved by the Accounting Firm as of the due date for such Tax Return, the Company shall be permitted to file such Tax Return as originally submitted by the Seller, and, after resolution by the Accounting Firm, such Tax Return shall thereafter be adjusted (or amended, if previously filed) to reflect such resolution and filed by the Company accordingly.

(c)                 Other than in respect of Flow-Through Tax Returns, the Company or its Subsidiaries shall pay any Taxes of the Company or its Subsidiaries that are due for which such party is primarily liable as prescribed by applicable Law with respect to the Tax Returns prepared by the Seller pursuant to Section 8.1(b) and the Seller shall be responsible for and shall pay to the Company its proportion of the Taxes reflected on such Tax Returns determined by the amount of such Taxes reflected on such Tax Returns multiplied by the Seller Percentage. The Seller shall remit such amounts to the Company as soon as reasonably practical, but no later than the due date for such Taxes.

(d)                Any Tax deductions or expenses incurred or deductible by the Company or any of its Subsidiaries as a result of the payment of any Indebtedness as finally determined pursuant to this Agreement, will, to the extent available under applicable Tax Law (as determined on a “more likely than not basis” by the Accounting Firm), be allocated for Tax reporting purposes to the Pre-Closing Tax Period. The Seller shall, in preparing any such Tax Return, to the extent permitted by applicable Law and if otherwise applicable, (i) adopt the calendar day convention under Treasury Regulation Section 1.706-4(c)(1)(i) and (ii) cause an election under Section 754 of the Code to be made with respect to the Tax period including the Closing Date.

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(e)                 In the case of Tax Returns that are filed with respect to Straddle Periods, the Buyer shall prepare such Tax Return in a manner consistent with past practice, except as otherwise required by Law. The Parties shall, to the extent permitted by applicable Law and if otherwise applicable, elect with the relevant Governmental Authority to treat the pre-Closing portion of any Straddle Period as a short taxable period ending as of the close of business on the Closing Date.

Section 8.2                  Tax Indemnification.

(a)                 Indemnification by the Seller. From and after the Closing, the Seller shall indemnify the Buyer and its Affiliates (including the Company and its Subsidiaries) (collectively, the “Tax Indemnified Buyer Parties”) against and hold them harmless from the Seller Percentage of any and all Tax Losses suffered or incurred by the Company or any Subsidiary of the Company. For purposes of this Agreement, “Tax Losses” shall mean, collectively (and individually, a “Tax Loss”): (i) any and all Losses suffered or incurred arising out of, or with respect to, Taxes of the Company or its Subsidiaries for Pre-Closing Tax Periods (“Pre-Closing Taxes”), (ii) any and all Losses suffered or incurred arising out of, or with respect to, Taxes of any Tax Indemnified Buyer Party resulting from (x) any breach of the representations and warranties set forth in Section 5.10(g), Section 5.10(h) or Section 5.10(i) or (y) a breach of any covenant or agreement set forth in this Agreement relating to Taxes.

(b)                Limitations.

(i)                  The amount of any Tax Loss for which a Tax Indemnified Buyer Party is otherwise entitled to indemnification for under this Section 8.2 shall be reduced by any Tax benefit actually realized as a reduction in cash Taxes payable by such Tax Indemnified Buyer Party as a result of such Tax Loss in the Tax period in which such Tax Loss occurs.

(ii)                The Tax Indemnified Buyer Parties shall not be entitled to indemnification to the extent the applicable Tax Loss arises solely out of amounts appropriately allocated to such Tax Indemnified Buyer Party under the Tax Audit Rules, in accordance with Section 8.4(b), or to the extent already paid pursuant to Section 8.1(c).

(c)                 Survival. The representations and warranties contained in Section 5.10 and the indemnification provided for in this Section 8.2 shall survive the Closing and continue in full force and effect until the sixth (6th) anniversary of the Closing Date (which date shall be extended solely with respect to any Tax Contest arising prior to such date until the settlement, termination or a final determination of liability in respect of such Tax Contest).

(d)                Post-Closing Taxes. Notwithstanding the indemnification obligations set forth in this Section 8.2, the Seller will not have any Liability or indemnification obligation for any Losses with respect to (i) other than as a result of a breach of Section 5.10(g) or Section 5.10(h), any Taxes of the Company or any of its

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Subsidiaries arising in a taxable period (or portion thereof) beginning after the Closing Date, (ii) the ability of the Buyer or any of its Affiliates (including the Company or any of its Subsidiaries) to utilize any Tax asset or attribute (e.g., net operating loss or Tax credit) in a post-Closing Tax period, or (iii) any Taxes arising as a result of any action taken outside the ordinary course of business by the Buyer or the Company or its Subsidiaries on the Closing Date after the Closing.

(e)                 Tax Treatment of Indemnity Payments. It is the intention of the Parties to treat any indemnity payment made under this Agreement as an adjustment to the Purchase Price for all Tax purposes, and the Parties agree to file their Tax Returns accordingly, except as otherwise required by a change in applicable Tax Law or a final “determination” within the meaning of Section 1313(a) of the Code.

(f)                  Additional Matters. For purposes of the indemnity in Section 8.2(a)(ii) (solely for purposes of determining the amount of any Tax Losses arising out of a breach of any applicable representation or warranty, but not for purposes of determining whether a breach of any representation or warranty has occurred), the representations and warranties contained in this Agreement shall be deemed to have been made without any qualifications as to materiality or similar qualifications.

(g)                Conflicts. Solely to the extent of any conflict between the provisions of this Section 8.2 and the provisions of Article IX, the provisions of this Section 8.2 shall prevail.

Section 8.3                  Tax Indemnification Procedures.

(a)                 After the Closing, the Buyer shall promptly notify the Seller in writing of any demand, claim or notice of the commencement of any Action received by the Buyer or any of its Affiliates from any Governmental Authority or any other Person with respect to Taxes for which the Seller is liable pursuant to Section 8.2; provided, however, that a failure to give such notice will not affect the Tax Indemnified Buyer Parties’ rights to indemnification under Section 8.2, except to the extent that the Seller is materially prejudiced thereby. Such notice shall contain factual information (to the extent known) describing the asserted Tax Loss and shall include copies of the relevant portion of any notice or other document received from any Governmental Authority or any other Person in respect of any such asserted Tax Loss.

(b)                Payment by the Seller of any amount due to a Tax Indemnified Buyer Party under Section 8.2 shall be made by wire transfer to a bank account designated by the applicable Tax Indemnified Buyer Party within thirty (30) days following written notice by the Buyer that payment with respect to such amounts to the appropriate Governmental Authority or other applicable third party is due from any such Tax Indemnified Buyer Party.

Section 8.4                  Tax Audits and Contests; Cooperation.

(a)                 After the Closing, the Seller shall control the conduct, through counsel of its own choosing, of any audit, claim for refund or any other Action

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involving any Taxes of, or with respect to, the Company or any Subsidiary of the Company (any such audit, claim for refund or other Action, a “Tax Contest”) for which it has an indemnification obligation under Section 8.2. Each of the Seller and the Buyer shall bear its share of the costs of any such Tax Contest based on its pro rata percentage ownership of the Company as of the Closing Date (i.e., seventy five percent (75%) by the Seller and twenty five percent (25%) by the Buyer). The Seller shall reasonably facilitate the Buyer’s participation in any such Tax Contest (including by providing copies of applicable notices and permitting the Buyer to review all filings reasonably in advance of submission), and the Buyer shall be permitted to employ separate counsel at its own expense in any such Tax Contest. The Seller shall not settle such Tax Contest without the prior written consent of the Buyer, such consent not to be unreasonably withheld, conditioned or delayed. In connection with any such Tax Contest that relates both to matters which the Seller would be entitled to control and to matters which the Seller would not be entitled to control hereunder, the parties shall reasonably cooperate to efficiently separate the administration of such Tax Contest such that each of the Seller and the Buyer controls its applicable portion of such Tax Contest.

(b)                The Company shall designate (and shall execute all such documents necessary to cause the designation of) the Seller as, and the Seller shall have the authority (and all powers incident thereto) to act in the capacity of, the “partnership representative” (within the meaning of the Tax Audit Rules) for the Company in respect of all Pre-Closing Tax Periods. Each of the Buyer and the Seller hereby consents to the making of a “push out” election under Section 6226 of the Code (or any similar provision of any applicable Tax Audit Rule) with respect to any Tax Contest relating to any Pre-Closing Tax Period, to the extent available under applicable Law. In connection with such “push out” election, the Buyer and the Seller shall cooperate to effect such election, to file all applicable Tax Returns required to be filed in connection therewith or as a result thereof, and to pay all of their respective Tax amounts due in respect of such Tax Returns.

(c)                 The Seller and the Buyer shall furnish or cause to be furnished to each other, upon request, as promptly as practicable, such information (including access to books and records) and assistance relating to the Company and its Subsidiaries as is reasonably requested for the filing of any Tax Returns and the preparation, prosecution, defense or conduct of any Tax Contest. The Seller and the Buyer shall use commercially reasonable efforts to cooperate with each other in the conduct of any Tax Contest or other proceeding involving or otherwise relating to the Company or a Subsidiary of the Company (or their income or assets) with respect to any Tax and each shall execute and deliver such powers of attorney and other documents as are necessary to carry out the intent of this Section 8.4. Any information obtained under this Section 8.4(c) shall be kept confidential, except as may be otherwise necessary in connection with the filing of Tax Returns or in the conduct of a Tax Contest or other Action.

(d)                Each of the Seller, the Buyer, the Company and the Subsidiaries of the Company shall (i) use its commercially reasonable efforts to properly retain and maintain the Tax and accounting records of, or relating to, the Company and

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its Subsidiaries that relate to Pre-Closing Tax Periods until the expiration of the applicable statute of limitations and shall thereafter provide the other party with written notice prior to any destruction, abandonment or disposition of all or any portions of such records, (ii) transfer such records to the other party upon its written request prior to any such destruction, abandonment or disposition and (iii) allow the other Parties and their respective agents and representatives, at times and dates reasonably and mutually acceptable to the Parties, to from time to time inspect and review such records as the requesting party may deem necessary or appropriate; provided, however, that in all cases, such activities are to be conducted by such other party and its agents and representatives subject to such reasonable restrictions as may be imposed by the party providing the relevant records, during normal business hours and at the requesting party’s sole expense. Any information obtained under this Section 8.4(d) shall be kept confidential, except as may be otherwise necessary in connection with the filing of Tax Returns or in the conduct of a Tax Contest or other Action.

Section 8.5                  Straddle Periods. The Buyer and the Seller will, to the extent permitted by applicable Law, elect, or otherwise reasonably cooperate, to close the Tax year of the Company and its Subsidiaries as of the close of business on the Closing Date. To the extent such election is unavailable, such that the Company or any of its Subsidiaries is required to file a Tax Return for a Tax period that begins before and ends after the Closing Date (a “Straddle Period”), the portion of any such Taxes (or refunds or credits of such Taxes) that constitutes Pre-Closing Taxes shall (a) in the case of Taxes (or refunds or credits of such Taxes) that are either (i) based upon or related to income or receipts or (ii) imposed in connection with any sale, transfer or assignment or any deemed sale, transfer or assignment of property (real or personal, tangible or intangible), be deemed equal to the amount that would be payable if the Tax year or period ended on the Closing Date and (b) in the case of Taxes (or refunds or credits of such Taxes) (other than those described in Section 8.4(a)) that are imposed on a periodic basis with respect to the business or assets of the Company or its Subsidiaries or otherwise measured by the level of any item, be deemed to be the amount of such Taxes for the entire Straddle Period (or, in the case of such Taxes (or refunds or credits of such Taxes) determined on an arrears basis, the amount of such Taxes for the immediately preceding Tax period), multiplied by a fraction, the numerator of which is the number of calendar days in the portion of the Straddle Period ending on the Closing Date and the denominator of which is the number of calendar days in the entire Straddle Period. Any exemption, deduction, credit or other item (including the effect of any graduated rates of Tax) that is calculated on an annual basis shall be allocated to the portion of the Straddle Period ending on the Closing Date on a pro rata basis determined by multiplying the total amount of such item allocated to the Straddle Period by a fraction, the numerator of which is the number of calendar days in the portion of the Straddle Period ending on the Closing Date and the denominator of which is the number of calendar days in the entire Straddle Period. In the case of any Taxes (or refunds or credits of such Taxes) based upon or measured by capital (including net worth or long-term debt) or intangibles, any amount thereof required to be allocated under this Section 8.5 shall be computed by reference to the level of such items on the Closing Date.

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Section 8.6                  Conveyance Taxes. Each of the Seller and the Buyer shall pay fifty percent of all sales, use, value added, transfer, stamp, registration, documentary, excise, real property transfer or gains or similar Taxes incurred as a result of the Contemplated Transactions and the Seller and the Buyer shall jointly file all required change of ownership statements, Tax Returns and similar statements in connection therewith, including any statements necessary to obtain an exemption from or refund of such Taxes.

Section 8.7                  Tax Treatment. For federal, and applicable state and local, income Tax purposes, the Parties shall treat the Contemplated Transactions in accordance with Situation 1 of Revenue Ruling 99-6, 1991-1 C.B. 432. The Parties shall file their federal, and applicable state and local, Tax Returns in a manner consistent with the foregoing unless otherwise required by a change in Law after the date hereof or a final “determination” within the meaning of Section 1313(a) of the Code.

Section 8.8                  Post-Closing Actions.

(a)                 Restrictions. After the Closing, none of the Buyer, the Company or any of its Subsidiaries, as applicable, will undertake any of the following actions without the Seller’s prior written consent, not to be unreasonably withheld, conditioned or delayed: (i) amend or otherwise modify, or permit to be amended or otherwise modified, any Tax Return of the Company or any of its Subsidiaries for any Pre-Closing Tax Period, (ii) initiate any voluntary contact with any Governmental Authority or representative thereof with respect to any Tax liability of the Company or any of its Subsidiaries with respect to any Pre-Closing Tax Period or that may affect the Tax liability of the Seller for any Pre-Closing Tax Period; provided, that in determining whether to consent, Seller shall take into account the relative materiality of the Tax exposure to each of the Seller and the Buyer that could reasonably be expected to result from such voluntary disclosure, (iii) make any Tax election for the Company or any of its Subsidiaries that has retroactive effect to any Pre-Closing Tax Period and which would reasonably be expected to increase Taxes of the Company and of its Subsidiaries in respect of such Pre-Closing Tax Period, or (iv) make any election pursuant to Section 336 or Section 338 of the Code for any Subsidiary of the Company with respect to the transactions contemplated by this Agreement.

(b)                Refunds. Any cash Tax refunds (or credits against actual cash Taxes payable) actually received by the Company or any of its Subsidiaries in respect of Taxes for any Pre-Closing Tax Period shall be tendered by the Buyer to the Seller in an amount equal to the Seller Percentage of such received (or credited) amount, within thirty (30) days after the Company’s, or such Subsidiary’s, actual receipt (or credit) thereof.

Article IX

INDEMNIFICATION

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Section 9.1                  Survival. Each representation, warranty and covenant contained in this Agreement shall survive the Closing and continue in full force and effect until the first (1st) anniversary of the Closing Date, (the “Release Date”); provided that (a) the Fundamental Representations shall survive until the sixth (6th) anniversary of the Closing Date, (b) the representations and warranties contained in Section 5.10 (Taxes) shall survive in the manner provided in Section 8.2 and (c) any covenant, agreement or obligation that by its terms is to be performed (in whole or in part) following the Closing shall survive in accordance with its terms (the Release Date or such other date described above, as applicable, the “Expiration Date”). Notwithstanding the preceding sentences of this Section 9.1, if the Buyer or the Seller, as applicable, delivers written notice to the other party of a claim for indemnification prior to the applicable Expiration Date, such claim shall survive until finally resolved or judicially determined.

Section 9.2                  Indemnification of the Buyer for Seller-Specific Breaches. Subject to the limitations set forth in this Article IX, from and after the Closing, the Seller shall indemnify and hold harmless, to the fullest extent permitted by Law, the Buyer, its Affiliates (including the Company and its Subsidiaries) and (in their capacity as such) each of their respective officers, directors, managers, equityholders, managers, employees, agents, representatives, successors and assigns (collectively, the “Buyer Indemnified Parties”) from, against and in respect of (x) the Seller Percentage of any Losses suffered or incurred by the Company or any Subsidiary of the Company (for clarity, regardless of whether, in the case of a Third Party Claim, such Third Party Claim is brought against the Company or any Subsidiary thereof and/or any of the other Buyer Indemnified Parties) and, without duplication, (y) one hundred percent (100%) of any Losses suffered or incurred directly by any of the Buyer Indemnified Parties other than the Company and its Subsidiaries (and for clarity not resulting from or arising out of Losses suffered by the Company or its Subsidiaries), in each case of clauses (x) and (y), whether or not involving a Third Party Claim, resulting from or arising out of any of the following:

(a)                 any breach of, or any inaccuracy in, any representation or warranty made by the Seller in Article IV or the Company in Article V (other than (i) any of the Seller Fundamental Representations or the Company Fundamental Representations or (ii) any of the representations or warranties made in Section 5.10 for which indemnification under Section 8.2 is the sole recourse);

(b)                any breach of, or any inaccuracy in, any Seller Fundamental Representation or Company Fundamental Representation made herein; or

(c)                 any breach or default in performance by the Seller of any of its covenants or obligations contained in this Agreement (other than the covenants or obligations in Article VIII for which indemnification under Section 8.2 is the sole recourse).

Section 9.3                  Indemnification of the Seller. Subject to the limitations set forth in this Article IX, from and after the Closing, the Buyer shall indemnify and hold harmless, to the fullest extent permitted by Law, the Seller, its Affiliates and (in their

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capacity as such) each of their respective officers, directors, managers, equityholders, employees, agents, representatives, successors and assigns (collectively, the “Seller Indemnified Parties”) from, against and in respect of any and all Losses, whether or not involving a Third Party Claim, resulting from or arising out of any of the following:

(a)                 any breach of, or inaccuracy in, any representation or warranty made by the Buyer in Article VI (other than any Buyer Fundamental Representation);

(b)                any breach of, or any inaccuracy in, any Buyer Fundamental Representation made herein;

(c)                 any breach or default in performance by the Buyer of any covenant or obligation of the Buyer contained in this Agreement; or

(d)                any breach or default in performance by the Company of any post-Closing covenant or obligation of the Company contained in this Agreement.

Section 9.4                  Limitations.

(a)                 Notwithstanding any other provision of this Article IX, but subject to Section 9.4(c) and Section 9.5, (i) the Seller shall not have any obligation to indemnify any Buyer Indemnified Party for any Losses arising from or related to an individual claim (or series of one or more claims arising from the same or substantially similar facts or circumstances) pursuant to Section 9.2(a) unless and until the aggregate amount of all Losses incurred or sustained by all Buyer Indemnified Parties arising from or related to such individual claim (or series of one or more claims arising from the same or substantially similar facts or circumstances) with respect to which the Buyer Indemnified Parties would otherwise be entitled to indemnification under Section 9.2(a) exceeds $25,000 (the “Mini-Basket”), whereupon the Seller shall be liable for all such Losses relating to such individual claim (including those incurred in reaching the Mini-Basket, but subject to the following clauses (ii), (iii) and (iv) below), (ii) the Seller shall not have any obligation to indemnify any Buyer Indemnified Party pursuant to Section 9.2(a) unless and until the aggregate amount of all such individual Losses incurred or sustained by all Buyer Indemnified Parties with respect to which the Buyer Indemnified Parties would otherwise be entitled to indemnification under Section 9.2(a) (disregarding, for clarity, any Losses incurred or sustained by the Buyer Indemnified Parties arising from or related to any individual claim (or series of one or more claims arising from the same or substantially similar facts or circumstances) that do not exceed the Mini-Basket) exceeds $1,200,000 (the “Threshold Amount”), whereupon the Seller shall be liable for all such Losses in excess of the Threshold Amount (subject to the following clauses (iii) and (iv)), (iii) the aggregate liability of the Seller to indemnify the Buyer Indemnified Parties for Losses under Section 9.2(a) shall in no event exceed $11,250,000 (the “Cap”) and (iv) the aggregate liability of the Seller to indemnify the Buyer Indemnified Parties for Losses under Section 9.2 shall in no event exceed the aggregate consideration actually received by the Seller.

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(b)                Notwithstanding any other provision of this Article IX, but subject to Section 9.4(c) and Section 9.5, (i) the Buyer shall not have any obligation to indemnify any Seller Indemnified Party for any Losses arising from or related to an individual claim (or series of one or more claims arising from the same or substantially similar facts or circumstances) pursuant to Section 9.3(a) unless and until the aggregate amount of all individual Losses incurred or sustained by all Seller Indemnified Parties arising from or related to such individual claim (or series of one or more claims arising from the same or substantially similar facts or circumstances) with respect to which the Seller Indemnified Parties would otherwise be entitled to indemnification under Section 9.3(a) exceeds the Mini-Basket, whereupon the Buyer shall be liable for all such Losses (including those incurred in reaching the Threshold Amount, but subject to the following clauses (ii) and (iii)), (ii) the Buyer shall not have any obligation to indemnify any Seller Indemnified Party pursuant to Section 9.3(a) unless and until the aggregate amount of all individual Losses incurred or sustained by all Seller Indemnified Parties with respect to which the Seller Indemnified Parties would otherwise be entitled to indemnification under Section 9.3(a) exceeds the Threshold Amount, whereupon the Buyer shall be liable for all such Losses in excess of the Threshold Amount (subject to the following clause (iii)), and (iii) the aggregate liability of the Buyer to indemnify the Seller Indemnified Parties for Losses under Section 9.3 shall in no event exceed an amount equal to the Cap.

(c)                 For the avoidance of doubt, the Mini-Basket, Threshold Amount and Cap shall not apply to any Losses resulting from breaches of covenants or Fundamental Representations or intentional fraud.

Section 9.5                  Limitation on Remedies. From and after the Closing and except with respect to (a) any post-Closing adjustment to the Estimated Purchase Price under Section 2.3, (b) claims arising from intentional fraud, (c) the enforcement of any covenant requiring performance following the Closing or (d) claims for equitable relief, the provisions of Section 7.11, Section 8.2 and this Article IX shall constitute the sole and exclusive remedy in respect of breaches of representations, warranties, covenants or agreements contained in this Agreement. For the avoidance of doubt, nothing in this Article IX shall preclude (x) a Buyer Indemnified Party from bringing a direct claim under any other Transaction Document or any commercial Contract against the Seller or any of its Affiliates party thereto or (y) a Seller Indemnified Party from bringing a direct claim against under any other Transaction Document or any commercial Contract against the Buyer or any of its Affiliates (including the Company and any of its Subsidiaries) party thereto.

Section 9.6                  Third Party Claims.

(a)                 Promptly after the receipt by any Person entitled to indemnification pursuant to this Article IX (the “Indemnified Party”) of notice of the commencement of any Action involving a third party (such Action, a “Third Party Claim”), such Indemnified Party shall, if a claim with respect thereto is to be made against any party or parties obligated to provide indemnification pursuant to this Article IX (the “Indemnifying Party”), give such Indemnifying Party written notice of

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such Third Party Claim in reasonable detail in light of the circumstances then known to such Indemnified Party (including a good faith estimate of the Loss (if estimable) with respect thereto); provided that the failure of the Indemnified Party to provide such notice shall not relieve the Indemnifying Party of its obligations hereunder, except to the extent that such failure to give notice shall materially prejudice any defense or claim available to the Indemnifying Party.

(b)                The Indemnifying Party shall be entitled to assume the defense of any Third Party Claim with counsel reasonably satisfactory to the Indemnified Party, at the Indemnifying Party’s sole expense; provided that the Indemnifying Party shall not be entitled to assume or continue control of the defense of any Third Party Claim if (i) the Third Party Claim relates to or arises in connection with any matter involving (or potentially involving) criminal or quasi-criminal conduct or criminal Action, (ii) the Third Party Claim seeks an injunction or equitable relief against any Indemnified Party or the Company, (iii) the Third Party Claim has or would reasonably be expected to result in Losses in excess of the Cap (if applicable thereto) by an amount in excess of the amount of the Cap, (iv) the Third Party Claim would reasonably be expected to have a material adverse effect on the Indemnified Party’s or the Company’s business, or (v) the Indemnifying Party has failed or is failing to use reasonable efforts to defend in good faith the Third Party Claim.

(c)                 If the Indemnifying Party assumes the defense of any Third Party Claim, (i) it shall not settle the Third Party Claim unless (A) the settlement does not entail any admission of liability on the part of any Indemnified Party, (B) the settlement involves only the payment of money damages that are indemnifiable in full by the Indemnifying Party under this Agreement and does not impose an injunction or other equitable relief upon the Indemnified Party or the Company, and (C) the settlement includes an unconditional release of the Company and each Buyer Indemnified Party or Seller Indemnified Party, as applicable, reasonably satisfactory to the Indemnified Party, from all Losses with respect to such Third Party Claim, (ii) it shall indemnify and hold the Indemnified Party harmless from and against any and all Losses caused by or arising out of any settlement or judgment of such claim and may not claim that it does not have an indemnification obligation with respect thereto, and (iii) the Indemnified Party shall have the right (but not the obligation) to participate in the defense of such Third Party Claim and to employ, at its own expense, counsel separate from counsel employed by the Indemnifying Party; except that the reasonable and documented fees, costs and expenses of such counsel shall be at the expense of the Indemnifying Party if the Indemnifying Party and the Indemnified Party are both named parties to the proceedings and the representation of both parties by the same counsel would be inappropriate due to actual or potential conflict of interest between them.

(d)                The Indemnified Party shall not settle any Third Party Claim that the Indemnifying Party is properly defending in accordance with Section 9.6(b) if the Indemnifying Party shall have any obligation as a result of such settlement (whether monetary or otherwise) unless such settlement is consented to in writing by the Indemnifying Party, such consent not to be unreasonably withheld, conditioned or delayed.

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(e)                 Each of the Buyer and the Seller shall reasonably cooperate, and cause their respective Affiliates to reasonably cooperate, in the defense or prosecution of any Third Party Claim. Any consent to be given by the Buyer Indemnified Parties under this Section 9.6 shall be given by the Buyer acting on behalf of the Buyer Indemnified Parties and any consent to be given by the Seller Indemnified Parties under this Section 9.6 shall be given by the Seller acting on behalf of the Seller Indemnified Parties.

Section 9.7                  Direct Claims. The Indemnified Party shall give the Indemnifying Party written notice of any claim on account of Losses that do not result from a Third Party Claim (a “Direct Claim”) in good faith in light of the circumstances then known to such Indemnified Party; provided that the failure of the Indemnified Party to provide such notice shall not relieve the Indemnifying Party of its obligations hereunder, except to the extent that such failure to give notice shall materially prejudice any defense or claim available to the Indemnifying Party. The Indemnifying Party shall have thirty (30) days following receipt of the Indemnified Party’s notice of a Direct Claim to make such investigation of the Direct Claim as the Indemnifying Party deems necessary or desirable. If the Indemnified Party and the Indemnifying Party agree at or prior to the expiration of such thirty (30)-day period (or any mutually agreed upon extension thereof) on the validity and amount of such claim, the Indemnifying Party shall, within five (5) Business Days, pay to the Indemnified Party the full amount of such Direct Claim. Otherwise, the parties shall have such rights as may be available to them under Section 10.8.

Section 9.8                  Additional Matters.

(a)                 Any Losses for which any Buyer Indemnified Party would otherwise be entitled to indemnification under this Article IX shall be reduced by (i) the amount of any insurance proceeds actually received by such Buyer Indemnified Party in respect of such Losses, (ii) any indemnification, contribution, compensation or other payment paid to such Buyer Indemnified Party by any third party in respect of such Loss and (iii) the amount of any Tax benefit actually realized as a reduction in cash Taxes payable by such Buyer Indemnified Party as a result of such Loss in the Tax period in which the Loss occurs (any such amount under clauses (i), (ii) or (iii), a “Reimbursement”). If any such Reimbursement is obtained subsequent to receipt by such Buyer Indemnified Party or Affiliate of any indemnification payment hereunder in respect of any Losses, then such Reimbursement shall be paid promptly to the Seller.

(b)                Each Buyer Indemnified Party shall use its commercially reasonable efforts (which, for the avoidance of doubt shall not require any Buyer Indemnified Party to initiate or maintain any Action) to (i) pursue payment and collect under or from any insurer or third party in respect of any Losses and (ii) mitigate any Losses for which it is entitled to indemnification under this Article IX.

(c)                 If any Buyer Indemnified Party receives any indemnification payment in respect of any Losses under this Article IX, at the election of

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the Seller, such Buyer Indemnified Party shall assign to the Seller all of its claims for recovery against any third party insurance provider as to such Losses.

(d)                Any liability for indemnification hereunder shall be determined without duplication of recovery. Without limiting the foregoing, in no event shall any Buyer Indemnified Party be entitled to indemnification under this Article IX for any Losses to the extent such Losses reduce the Base Purchase Price or are included in the Final Adjustment Amount.

(e)                 For purposes of this Article IX (solely for purposes of determining the amount of any Losses arising out of a breach of any representation or warranty contained in this Agreement, but not for purposes of determining whether a breach of any representation or warranty contained in this Agreement has occurred), the representations and warranties contained in this Agreement shall be deemed to have been made without any qualifications as to materiality, Material Adverse Effect or similar qualifications; provided, that the foregoing shall not apply to the representations and warranties contained in Section 5.8, Section 5.9(b) or Section 5.9(c).

Article X

MISCELLANEOUS

Section 10.1               Expenses. Except as otherwise expressly provided herein, the Company (including its Subsidiaries), the Seller and the Buyer shall each pay all of their own fees, costs and expenses (including attorneys’ and accountants’ fees, costs and expenses) in connection with the negotiation of this Agreement, the performance of their obligations hereunder and the consummation of the Contemplated Transactions; provided that (a) the Buyer shall bear fifty percent (50%) of all filing fees and other charges for the filing under the HSR Act and the Seller shall bear fifty percent (50%) of all such fees, (b) the Buyer shall bear all Company Audit Costs and (c) the Buyer shall bear all Company Audit Preparation Costs up to an amount equal to $160,000, after which amount the Buyer shall bear fifty percent (50%) of the Company Audit Preparation Costs and the Seller shall bear fifty percent (50%) of the Company Audit Preparation Costs. The Buyer shall reimburse the Seller concurrently with the payment of the Estimated Purchase Price for any Company Audit Preparation Costs borne by the Seller prior to the Closing for which the Buyer is responsible hereunder.

Section 10.2               Amendments and Waivers. This Agreement may not be amended except by an instrument in writing signed on behalf of the Buyer and the Seller. Waiver of any term or condition of this Agreement by any Party shall only be effective if in writing and shall not be construed as a waiver of any subsequent breach or failure of the same term or condition or a waiver of any other term or condition of this Agreement.

Section 10.3               Entire Agreement. The Transaction Documents contain all of the terms, conditions and representations and warranties agreed to by the Parties relating to the subject matter of this Agreement and supersede all prior and contemporaneous agreements, negotiations, correspondence, undertakings and

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communications of the Parties or their representatives, oral or written, respecting such subject matter.

Section 10.4               Notices. Any notice or other communication required or permitted under this Agreement shall be deemed to have been duly given and made (a) if in writing and served by personal delivery, (b) if delivered by email (if receipt is not confirmed via return email, the effective date of notice is the date of the original email; provided, that notice is provided by alternative means on the next day), or (c) if delivered by certified mail, registered mail or courier service, return-receipt received, in each case, to the Party for whom it is intended at the address set forth below, with copies sent to the Persons indicated:

If to the Buyer or the Company (after the Closing), to:

HMTV DTC, LLC

c/o Hemisphere Media Group, Inc.

4000 Ponce de Leon Blvd., Suite 650

Coral Gables, FL 33146
Attention:

Email:

 

with a copy (which shall not constitute notice) to:

Paul, Weiss, Rifkind, Wharton & Garrison LLP
1285 Avenue of the Americas
New York, NY 10019-6064
Attention:
Email:

and

Sheppard, Mullin, Richter & Hampton LLP
1901 Avenue of the Stars, Suite 1600
Los Angeles, CA 90067
Attention:
Email:

 

If to the Seller or the Seller Guarantor, to:

Artisan Home Entertainment Inc.
2700 Colorado Ave.

Santa Monica, CA 90404

Attention:

Email:

 

with a copy (which shall not constitute notice) to:

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O’Melveny & Myers LLP
1999 Avenue of the Stars, Suite 800
Attention:

Email:

 

Such addresses may be changed, from time to time, by means of a notice given in the manner provided in this Section 10.4.

Section 10.5               Binding Effect; Assignment. Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any Party without the prior written consent of the Buyer (in the case of any assignment by any Seller, or prior to the Closing, the Company) or the Seller (in the case of any assignment by the Buyer or, from and after the Closing, the Company), and any purported assignment or other transfer without such consent shall be void and unenforceable; provided, however, that without written consent of any Party, (i) the Buyer may assign all or any portion of its rights and obligations hereunder to any of its Affiliates, and (ii) the Buyer may assign all or any of its rights hereunder to a wholly owned direct or indirect Subsidiary of the Buyer or to any of their respective Affiliates, but no assignment shall relieve the Buyer of any Liability hereunder. Subject to the preceding sentence, this Agreement shall be binding upon, inure to the benefit of and be enforceable by the Parties and their respective successors and permitted assigns.

Section 10.6               No Third Party Beneficiary. Nothing in this Agreement shall confer any rights, remedies or claims upon any Person not a Party or a permitted assignee of a Party, except as set forth in Article IX (Indemnification), or Section 10.12 (No Recourse Against Non-Parties).

Section 10.7               Governing Law. This Agreement and all claims or causes of action (whether in contract or tort) that may be based upon, arise out of or relate to this Agreement or the negotiation, execution or performance of this Agreement (including any claim or cause of action based upon, arising out of or related to any representation or warranty made in or in connection with this Agreement or as an inducement to enter into this Agreement), shall be governed by the internal laws of the State of Delaware, without giving effect to the principles of conflicts of law thereof or of any other jurisdiction.

Section 10.8               Consent to Jurisdiction and Service of Process.

(a)                 Other than an Action by the Buyer or the Seller for equitable relief as set forth in Section 10.8(b), any Action seeking to enforce any provision of, or, directly or indirectly arising out of or in any way relating to, this Agreement or the Contemplated Transactions shall be brought in the Court of Chancery of the State of Delaware (or, if such court shall not have jurisdiction, any federal court of the United States sitting in Delaware, of if jurisdiction is not then available in such federal court, then in any Delaware state court siting in New Castle County), and each of the Parties hereby irrevocably consents to the exclusive jurisdiction of such courts in any such Action and irrevocably waives, to the fullest extent permitted by Law, any objection

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that it may now or hereafter have to the laying of the venue of any such Action in any such court or that any such Action brought in any such court has been brought in an inconvenient forum. Process in any such Action may be served on any Party anywhere in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each Party agrees that service of process on such Party as provided in Section 10.4 shall be deemed effective service of process on such Party.

(b)                Nothing contained in Section 10.8(a) shall limit the right of the Buyer or the Seller to take any Action against the other Party in any court of competent jurisdiction for the purposes of seeking any equitable remedy or relief, including injunctions, rescission or specific performance, nor shall the taking of any such Action by the Buyer or the Seller in one or more jurisdictions preclude the taking of any such Action in any other jurisdiction (whether concurrently or not) if and to the extent permitted by Law.

Section 10.9               WAIVER OF JURY TRIAL. EACH PARTY HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE CONTEMPLATED TRANSACTIONS (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH PARTY (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS Section 10.9.

Section 10.10            Specific Performance. The Parties agree that irreparable damage would occur in the event that the provisions of this Agreement were not performed in accordance with their specific terms. Accordingly, it is hereby agreed that the Parties shall be entitled to an injunction or injunctions to enforce specifically the terms and provisions hereof in any court of the United States or any state having jurisdiction, this being in addition to any other remedy to which they are entitled at law or in equity.

Section 10.11            Severability. Without limitation to anything expressly provided in Section 7.2(c)(ii), if any provision of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the remainder of the provisions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the Contemplated Transactions is not affected in any manner materially adverse to any Party. Upon such a determination, the Buyer, the Company and the Seller shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a reasonably acceptable manner so that the Contemplated

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Transactions may be consummated as originally contemplated to the fullest extent possible.

Section 10.12            No Recourse Against Non-Parties. This Agreement may only be enforced against, and any Action based upon, arising out of, or related to this Agreement, or the negotiation, execution or performance of this Agreement (including any representation or warranty made in or in connection with this Agreement or as an inducement to enter into this Agreement), may only be brought against the entities that are expressly named as Parties and then only with respect to the specific obligations set forth herein with respect to such Party. No past, present or future director, officer, employee, incorporator, manager, member, partner, stockholder, Affiliate, agent, attorney or other advisors of the Buyer, the Company or the Seller or of any Affiliate of any of them, or any of their respective successors or permitted assigns (collectively, “Non-Party Affiliates”), shall have any liability (whether in contract or in tort, in law or in equity, or based upon any theory that seeks to impose liability of an entity party against its owners or Affiliates) for any obligations or liabilities of any Party under this Agreement or for any claim or Action based on, in respect of or by reason of the Contemplated Transactions and each Party waives and releases all such liabilities, claims and obligations against any such Non-Party Affiliates. Non-Party Affiliates are expressly intended as third party beneficiaries of this provision of this Agreement.

Section 10.13            Counterparts. This Agreement may be signed in any number of counterparts with the same effect as if the signatures to each counterpart were upon a single instrument, and all such counterparts together shall be deemed an original of this Agreement. This Agreement shall become effective when, and only when, each Party shall have received a counterpart hereof signed by all of the other Parties.

Section 10.14            Guarantee. Subject to the limitations on the Seller’s liability set forth in this Agreement, during the period commencing on the Closing Date and ending upon the six (6) year anniversary of the Closing Date, in each case, subject to extension for any then-pending claims, the Seller Guarantor hereby guarantees the payment obligations of the Seller under Article IX. Notwithstanding anything to the contrary in this Section 10.14 or otherwise, the Buyer hereby agrees that: (i) to the extent that the Seller is relieved of all or any portion of its payment obligations under Article IX, the Seller Guarantor shall be similarly relieved of its corresponding obligations hereunder; and (ii) the Seller Guarantor shall have all defenses to its obligations hereunder that are available to the Seller under this Agreement with respect to the obligations guaranteed hereunder, as well as any defenses in respect of intentional fraud of the Buyer

[Remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the date first above written.

 

  HMTV DTC, LLC, as the Buyer  
       
       
  By: /s/ Alan J. Sokol  
    Name: Alan J. Sokol  
    Title:  President  

 

[Signature Page to Securities Purchase Agreement]

   

 

IN WITNESS WHEREOF, the parties hereto have executed and delivered this Agreement as of the date first above written.

  PANTAYA, LLC, as the Company  
       
  By: /s/ Paul Presburger  
    Name: Paul Presburger  
    Title:  President  
       
  ARTISAN HOME ENTERTAINMENT INC., as the Seller  
       
  By: /s/ Adrian Kuzycz  
    Name: Adrian Kuzycz  
    Title: President and Secretary  
       
  Solely for purposes of Section 10.14:  
       
  Lions Gate Entertainment Inc., as the Seller Guarantor  
       
  By: /s/ Adrian Kuzycz  
    Name: Adrian Kuzycz  
    Title: President and Secretary  

 

[Signature Page to Securities Purchase Agreement]

   

 

[Exhibit A

Form of Licensed Technology Agreement

  

 

Licensed Technology Agreement]

 

 

  

 

[Exhibit B

Form of Contribution Agreement]

 

  

 

 

Exhibit C

[Intentionally Omitted.]

 

  

 

Exhibit D

[Intentionally Omitted.]

 

  

 

Exhibit E

[Intentionally Omitted.]

 

  

 

Exhibit F

[Intentionally Omitted.]

 

  

 

[Exhibit G

Form of TSA]

 

 

  

 

Exhibit H-1

[Intentionally Omitted.]

 

  

 

Exhibit H-2

[Intentionally Omitted.]

 

  

 

Exhibit I

[Form of Instrument of Assignment]

  

 

 

Exhibit J

[Intentionally Omitted.]

 

  

 

 

[Exhibit K

Disclosure Schedules]

 

  

EXHIBIT 10.1

 

 

 

CREDIT AGREEMENT

dated as of

July 30, 2013

 

And as Amended by

Amendment No. 1 on July 31, 2014,

Amendment No. 2 on February 14, 2017

and

Amendment No. 3 on March 31, 2021

among

HEMISPHERE MEDIA HOLDINGS, LLC and
INTERMEDIA ESPAÑOL, INC.,

as Borrowers,

HMTV, LLC,

as Holdings,

THE LENDERS PARTY HERETO

and

JPMorgan Chase Bank, N.A.,

as Administrative Agent
_________________________

JPMorgan Chase Bank, N.A., Deutsche Bank Securities Inc. and RBC Capital Markets[1],
as Joint Lead Arrangers and Joint Bookrunners for Amendment No. 2,

 

 

Deutsche Bank Securities Inc.,
as Syndication Agent for Amendment No. 2,

 

and

 

CIT Finance LLC,

as Documentation Agent for Amendment No. 2
_________________________

JPMorgan Chase Bank, N.A. and BofA Securities, Inc.,
as Joint Lead Arrangers and Joint Bookrunners for Amendment No. 3

 

 

 

 

 

 

 

[1] RBC Capital Markets is a brand name for the capital markets business of Royal Bank of Canada and its affiliates.

 

  

 

 

Table of Contents

 

   

Page

     
ARTICLE I  
     
Definitions  
     
Section 1.01 Defined Terms 1
Section 1.02 Terms Generally 43
Section 1.03 Accounting Terms 43
Section 1.04 Pro Forma Calculations 43
Section 1.05 Classification of Loans and Borrowings 44
Section 1.06 Currency Equivalents Generally 45
Section 1.07 Rounding 45
Section 1.08 References to Laws 45
Section 1.09 Times of Day 45
Section 1.10 Covenant Compliance Generally 45
Section 1.11 Available Amount Transactions 45
Section 1.12 Interest Rate Calculations 45
     
ARTICLE II  
     
Term Loan Facilities  
     
Section 2.01 Commitments 45
Section 2.02 Term Loans 46
Section 2.03 Borrowing Procedure 47
Section 2.04 Evidence of Debt; Repayment of Term Loans 48
Section 2.05 Fees 48
Section 2.06 Interest on Loans 48
Section 2.07 Default Interest 49
Section 2.08 Alternate Rate of Interest 49
Section 2.09 Termination of Term B-1 Commitments 49
Section 2.10 Conversion and Continuation of Borrowings 49
Section 2.11 Repayment of Term Borrowings 50
Section 2.12 Voluntary Prepayment 51
Section 2.13 Mandatory Prepayments 52
Section 2.14 Reserve Requirements; Change in Circumstances 54
Section 2.15 Change in Legality 54
Section 2.16 Breakage 55
Section 2.17 Pro Rata Treatment 55
Section 2.18 Sharing of Setoffs 55
Section 2.19 Payments 56
Section 2.20 Taxes 56
Section 2.21 Assignment of Commitments under Certain Circumstances; Duty to Mitigate 59
Section 2.22 Incremental Term Loans and Incremental Revolving Facilities. 59
Section 2.23 New Term Loan Facility 61
Section 2.24 New Incremental Notes 63
Section 2.25 Extensions of Term Loans 64
Section 2.26 Refinancing Amendments 66
Section 2.27 Lead Borrower 67

 

 -i- 

 

 

    Page
     
ARTICLE III  
     
Representations and Warranties  
     
Section 3.01 Organization; Powers 67
Section 3.02 Authorization 67
Section 3.03 Enforceability 67
Section 3.04 Governmental Approvals 67
Section 3.05 Financial Statements 68
Section 3.06 No Material Adverse Effect 68
Section 3.07 Title to Properties; Possession Under Leases 68
Section 3.08 Subsidiaries 68
Section 3.09 Litigation; Compliance with Laws 68
Section 3.10 Designation of Indebtedness 69
Section 3.11 Federal Reserve Regulations 69
Section 3.12 Investment Company Act 69
Section 3.13 Use of Proceeds 69
Section 3.14 Tax Returns 69
Section 3.15 No Material Misstatements 69
Section 3.16 Employee Benefit Plans 70
Section 3.17 Environmental Matters 70
Section 3.18 [Reserved] 70
Section 3.19 Security Documents 70
Section 3.20 Location of Real Property and Leased Premises 71
Section 3.21 Labor Matters 71
Section 3.22 Solvency 71
Section 3.23 [Reserved] 71
Section 3.24 Anti-Corruption Laws and Sanctions 71
Section 3.25 Intellectual Property 72
Section 3.26 Special Representations Relating to FCC Licenses, Etc. 72
     
ARTICLE IV  
     
Conditions of Lending  
     
Section 4.01 All Credit Events 72
Section 4.02 First Credit Event 73
     
ARTICLE V  
     
Affirmative Covenants  
     
Section 5.01 Existence; Compliance with Laws; Businesses and Properties 75
Section 5.02 Insurance 75
Section 5.03 Obligations and Taxes 76
Section 5.04 Financial Statements, Reports, etc. 76
Section 5.05 Litigation and Other Notices 78
Section 5.06 Information Regarding Collateral 79
Section 5.07 Maintaining Records; Access to Properties and Inspections; Maintenance of Ratings 79
Section 5.08 Use of Proceeds 80
Section 5.09 Employee Benefits 80
Section 5.10 Covenant to Guarantee Obligations and Give Security 80
Section 5.11 Compliance with Environmental Laws 82
Section 5.12 [Reserved] 82

 

 -ii- 

 

 

    Page
     
Section 5.13 Further Assurances 82
Section 5.14 Maintenance of Company Separateness of Unrestricted Subsidiaries 83
Section 5.15 Designation of Subsidiaries 83
Section 5.16 Post-Closing Items 83
     
ARTICLE VI  
     
Negative Covenants  
     
Section 6.01 Indebtedness 84
Section 6.02 Liens 86
Section 6.03 Sale and Lease-back Transactions 88
Section 6.04 Investments, Loans and Advances 88
Section 6.05 Mergers, Consolidations and Dispositions 90
Section 6.06 Restricted Payments; Restrictive Agreements 93
Section 6.07 Transactions with Affiliates 95
Section 6.08 Change in Nature of Business 95
Section 6.09 Other Indebtedness and Agreements 95
Section 6.10 Revolving Facility Covenants 96
Section 6.11 Certain Equity Securities 96
Section 6.12 Holdings 96
     
ARTICLE VII  
     
Events of Default  
     
Section 7.01 Events of Default 96
Section 7.02 Application of Proceeds 99
Section 7.03 Borrowers’ Right to Cure. 100
     
ARTICLE VIII  
     
The Administrative Agent and the Collateral Agent; etc.  
     
ARTICLE IX  
     
Miscellaneous  
     
Section 9.01 Notices; Electronic Communications 106
Section 9.02 Survival of Agreement 108
Section 9.03 Binding Effect 109
Section 9.04 Successors and Assigns 109
Section 9.05 Expenses; Indemnity 114
Section 9.06 Right of Setoff 115
Section 9.07 Applicable Law 115
Section 9.08 Waivers; Amendment 116
Section 9.09 Interest Rate Limitation 117
Section 9.10 Entire Agreement 118
Section 9.11 Waiver of Jury Trial 118
Section 9.12 Severability 118
Section 9.13 Counterparts 118
Section 9.14 Headings 118
Section 9.15 Jurisdiction; Consent to Service of Process 118
Section 9.16 Confidentiality 119
Section 9.17 Lender Action 119

 

 -iii- 

 

 

 

    Page
     
Section 9.18 USA PATRIOT Act Notice 119
Section 9.19 Accounting Matters 119
Section 9.20 Electronic Execution of Assignments and Certain Other Documents 120
Section 9.21 Use of Name, Logo, etc 120
Section 9.22 Joint and Several Liability of the Borrowers 120
Section 9.23 Acknowledgement and Consent to Bail-In of EEA Financial Institutions 121
Section 10.01 Revolving Commitments 121
Section 10.02 Revolving Loans. 121
Section 10.03 Borrowing Procedure for Revolving Borrowings 122
Section 10.04 Fees. 122
Section 10.05 Interest on Revolving Loans. 123
Section 10.06 Letters of Credit. 123
Section 10.07 Funding of Revolving Borrowings. 127
Section 10.08 Conversion and Continuation of Revolving Borrowings. 128
Section 10.09 Termination and Reduction of Revolving Commitments. 128
Section 10.10 Repayment of Revolving Loans; Evidence of Debt. 128
Section 10.11 Prepayment of Revolving Loans. 129
Section 10.12 Other Mechanical Provisions Applicable to Revolving Loans. 129
Section 10.13 Defaulting Lenders 129

 

SCHEDULES

 

Schedule 1.01(b) - Subsidiary Guarantors
Schedule 2.01 - Term Lenders and Term Commitments
Schedule 2.08 - Alternate Rates of Interest (Effective upon payoff of all Term B-1 Loans)
Schedule 3.08 - Subsidiaries
Schedule 3.09 - Litigation
Schedule 3.16 - ERISA Events
Schedule 3.17 - Environmental Matters
Schedule 3.19(a) - UCC Filing Offices
Schedule 3.20(a) - Owned Real Property
Schedule 3.20(b) - Leased Real Property
Schedule 3.21 - Labor Matters
Schedule 3.26 - FCC Licenses
Schedule 4.02(a) - Local Counsel
Schedule 5.16 - Post-Closing Items
Schedule 6.01 - Existing Indebtedness
Schedule 6.02 - Existing Liens
Schedule 6.04 - Existing Investments
Schedule 6.06 - Existing Restrictive Agreements
Schedule 6.07 - Existing Transactions with Affiliates
Schedule 10.01 - Revolving Lenders; Revolving Commitments; Letter of Credit Commitments

 

EXHIBITS

 

Exhibit A - Form of Administrative Questionnaire
Exhibit B - Form of Assignment and Acceptance
Exhibit C - Form of Borrowing Request
Exhibit D - Security Agreement
Exhibit E - Form of Guaranty
Exhibit F - Form of Affiliate Subordination Agreement
Exhibit G-1 - Form of Opinion of Paul, Weiss, Rifkind, Wharton & Garrison LLP
Exhibit G-2 - Form of Puerto Rico Counsel Opinion
Exhibit G-3 - Form of FCC Counsel Opinion

 

 -iv- 

 

 

Exhibit H - Form of Officer’s Certificate
Exhibit I - Form of Solvency Certificate
Exhibit J - Form of United States Tax Compliance Certificate

 

 

 

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CREDIT AGREEMENT dated as of July 30, 2013 (as amended by Amendment No. 1 on July 31, 2014 and Amendment No. 2 on February 14, 2017), among HEMISPHERE MEDIA HOLDINGS, LLC, a Delaware limited liability company (the “Lead Borrower”), INTERMEDIA ESPAÑOL, INC., a Delaware corporation (“WAPA PR” and, together with the Lead Borrower, the “Borrowers”), HMTV, LLC, a Delaware limited liability company (“Holdings”), the Lenders (such term and each other capitalized term used but not defined in this introductory statement having the meaning given to it in Article I), JPMorgan Chase Bank, N.A., as administrative agent and collateral agent for the Lenders.

PRELIMINARY STATEMENTS

The Borrowers have requested that, upon the satisfaction in full of the conditions precedent set forth in Article IV below, the Lenders make available Initial Term Loans on the Closing Date denominated in Dollars to the Borrowers (as allocated among them in the Borrowing Request) in an aggregate principal amount of $175,000,000 pursuant to this Agreement.

The proceeds of the Initial Term Loans will be used to (i) repay the Existing Indebtedness, (ii) pay all fees and expenses incurred in connection with the Transaction and (iii) provide for working capital needs and general corporate purposes (including Permitted Acquisitions) of the Borrowers and their Subsidiaries.

The Lenders are willing to provide the Initial Term Loans on the terms and subject to the conditions set forth herein. In consideration of the mutual covenants and agreements herein contained, the parties hereto covenant and agree as follows:

ARTICLE I

Definitions

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

ABR,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.

Acquired Entity” shall have the meaning assigned to such term in Section 6.04(f).

Acquisition Representations” shall mean (a) the representations made by the seller with respect to the Acquired Entity (or similar Person) in connection with any Designated Acquisition as are material to the interests of the Lenders, but only to the extent that Borrowers or any of their Subsidiaries has the right (determined without regard to any notice requirement thereof) to terminate their obligations in connection with such Designated Acquisition or decline to consummate such Designated Acquisition (in each case pursuant to the terms thereof) as a result of a breach of one or more of such representations in the acquisition agreement in connection with such Designated Acquisition and (b) the representations and warranties made solely by the Borrowers and the Restricted Subsidiaries (x) in Section 3.22 (solely with respect to the Borrowers and their Restricted Subsidiaries on a consolidated basis) and (y) Sections 3.01(a) and (d), 3.02(a) and (b)(i)(A) (limited to the constitutive documents of Holdings and the Borrowers), 3.03, 3.11, 3.12, 3.19 (limited to creation, validity and perfection) and 3.24, in each case, after giving effect to such Permitted Acquisition.

Additional Term B-1 Commitment” shall mean, with respect to the Additional Term B-1 Lender, its commitment to make a Term B-1 Loan on the Amendment No. 2 Effective Date in an amount equal to $213,347,000 minus the aggregate principal amount of the Converted Term B Loans of all Lenders.

Additional Term B-1 Lender” shall mean the Person identified as such in Amendment No. 2.

Additional Term B-1 Loan” shall have the meaning provided in Section 2.01(a)(ii).

  

 

 

Add-on Term B-1 Commitment” shall mean, with respect to the Add-on Term B-1 Lender, its commitment to make a Term B-1 Loan on the Amendment No. 3 Effective Date in an amount equal to $50,000,000.

 

Add-on Term B-1 Lender” shall mean the Person identified as such in Amendment No. 3.

 

Add-on Term B-1 Loan” shall have the meaning provided in Section 2.01(a)(i).

 

Adjusted LIBO Rate” shall mean, with respect to any Eurodollar Borrowing for any Interest Period, an interest rate per annum equal to the product of (i) the LIBO Rate in effect for such Interest Period and (ii) Statutory Reserves.

Administrative Agent” shall mean (i) with respect to any period prior to the Amendment No. 1 Effective Date, Deutsche Bank AG New York Branch and (ii) from and after the Amendment No. 1 Effective Date, JPMorgan Bank, N.A. (or any successor thereto in such capacity).

Administrative Questionnaire” shall mean an Administrative Questionnaire in the form of Exhibit A, or such other form as may be supplied from time to time by the Administrative Agent.

Affiliate” shall mean, when used with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified.

Affiliate Subordination Agreement” shall mean an Affiliate Subordination Agreement in the form of Exhibit F pursuant to which intercompany obligations and advances owed by any Loan Party are subordinated to the Obligations.

Affiliated Lender” shall mean the Permitted Investors and their respective Affiliates (other than Holdings, the Borrowers and any of their respective Subsidiaries).

Agents” shall mean the Collateral Agent and the Administrative Agent.

Agreement” shall mean this Credit Agreement dated as of July 30, 2013, as amended by Amendment No. 1, Amendment No. 2 and Amendment No. 3.

Amendment No. 1” shall mean Amendment No. 1 to this Agreement, dated as of July 31, 2014, by and among the Borrowers, Holdings, JPMorgan Chase Bank, N.A., Deutsche Bank AG New York Branch, the Lenders party thereto and the other parties thereto.

Amendment No. 2” shall mean Amendment No. 2 to this Agreement, dated as of February 14, 2017, by and among the Borrowers, Holdings, JPMorgan Chase Bank, N.A., the Lenders party thereto and the other parties thereto.

Amendment No. 2 Consenting Lender” shall mean each Lender that provided the Administrative Agent with a counterpart to Amendment No. 2 executed by such Lender prior to the Amendment No. 2 Effective Date.

Amendment No. 2 Effective Date” shall mean February 14, 2017.

Amendment No. 2 Lead Arrangers” shall mean JPMorgan Chase Bank, N.A., Deutsche Bank Securities Inc. and RBC Capital Markets[2] in their capacities as Joint Lead Arrangers and Joint Bookrunners for Amendment No. 2.

 

 

 

[2] RBC Capital Markets is a brand name for the capital markets business of Royal Bank of Canada and its affiliates.

 

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Amendment No. 3” shall mean Amendment No. 3 to this Agreement, dated as of the Amendment No. 3 Effective Date, by and among the Borrowers, Holdings, JPMorgan Chase Bank, N.A., the Revolving Lenders party thereto and the other parties thereto.

 

Amendment No. 3 Effective Date” shall mean March 31, 2021.

Amendment No. 3 Lead Arrangers” shall mean JPMorgan Chase Bank, N.A., and BofA Securities, Inc., in their capacities as Joint Lead Arrangers and Joint Bookrunners for Amendment No. 3.

Alternate Base Rate” shall mean for any day a fluctuating rate per annum equal to the highest of (a) the NYFRB Rate in effect on such date plus 1/2 of 1%, (b) the rate of interest in effect for such day as publicly announced from time to time by the Administrative Agent as its “prime rate,” and (c) the Adjusted LIBO Rate on such day (or if such day is not a Business Day, the immediately preceding Business Day) for a deposit in dollars with a maturity of one month commencing on such day (or, if such day is not a Business Day, commencing on the preceding Business Day) plus 1.00%. The “prime rate” is a rate set by Administrative Agent based upon various factors including Administrative Agent’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in such prime rate announced by Administrative Agent shall take effect at the opening of business on the day specified in the public announcement of such change. Notwithstanding the foregoing, the Alternate Base Rate will be deemed to be 1.00% per annum if the Alternate Base Rate calculated pursuant to the foregoing provisions would otherwise be less than 1.00% per annum. Upon the payoff of all Term B-1 Loans, this definition automatically shall cease to be in force and effect and the definition of Alternate Base Rate set forth in Schedule 2.08 automatically shall apply.

Anti-Corruption Laws” shall mean all laws, rules, and regulations of any jurisdiction applicable to the Borrower or its Affiliates from time to time concerning or relating to bribery or corruption.

Applicable Excess Cash Flow Percentage” shall mean 50%; provided that, so long as no Default or Event of Default exists on the respective Excess Cash Flow Payment Date, (i) if the First Lien Net Leverage Ratio as of the last day of the respective Excess Cash Flow Payment Period is less than or equal to 3.50:1.00 but greater than 2.75:1.00, then the Applicable Excess Cash Flow Percentage instead shall be 25% and (ii) if the First Lien Net Leverage Ratio as of the last day of the respective Excess Cash Flow Payment Period is less than or equal to 2.75:1.00, then the Applicable Excess Cash Flow Percentage instead shall be 0%.

Applicable Law” shall mean all applicable provisions of constitutions, laws, statutes, ordinances, rules, treaties, regulations, permits, licenses, approvals, interpretations and orders of courts or Governmental Authorities and all orders and decrees of all courts and arbitrators.

Applicable Lender” shall mean (i) prior to the payoff of all Term B-1 Loans, each Revolving Lender and each Issuing Bank, and (ii) upon and after the payoff of all Term B-1 Loans, each Term Lender, Revolving Lender and Issuing Bank.

Applicable Margin” shall mean a rate per annum, for any day with respect to the Term B-1 Loan that is (i) a Eurodollar Loan of 3.50% or (ii) an ABR Loan of 2.50%.

Applicable Percentage” means, with respect to any Revolving Lender, the percentage of the total Revolving Commitments represented by such Revolving Lender’s Revolving Commitment; provided that, in the case of Section 10.13, when a Defaulting Lender shall exist, “Applicable Percentage” shall mean the percentage of the total Revolving Commitments (disregarding any Defaulting Lender’s Revolving Commitment) represented by such Revolving Lender’s Revolving Commitment. If the Revolving Commitments have terminated or expired, the Applicable Percentages shall be determined based upon the Revolving Commitments most recently in effect, giving effect to any assignments and to any Revolving Lender’s status as a Defaulting Lender at the time of determination.

Applicable Rate” shall mean, for any day, with respect to any Revolving Loan that is a Eurodollar Loan or an ABR Loan, the applicable rate per annum set forth below under the caption “Eurodollar Spread” or “ABR

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Spread”, as the case may be, based upon the First Lien Net Leverage Ratio as of the end of the fiscal quarter for which consolidated financial statements have theretofore been most recently delivered pursuant to Section 5.04(a) or Section 5.04(b), provided that until the date of the delivery of the consolidated financial statements pursuant to Section 5.04(b) as of and for the fiscal quarter ended June 30, 2021, the Applicable Rate shall be based on the rates per annum set forth in Category 2:

 

Pricing Level First Lien Net Leverage Ratio Eurodollar Spread ABR Spread Commitment Fee Rate
1 Greater than 3.50:1.00 3.00% 2.00% 0.375%
2 Less than or equal to 3.50:1.00 but greater than 2.50:1.00 2.75% 1.75% 0.375%
3 Less than or equal to 2.50:1.00 but greater than 1.50:1.00 2.25% 1.25% 0.375%
4 Less than or equal to 1.50:1.00 2.00% 1.00% 0.375%

 

For purposes of the foregoing, each change in the Applicable Rate resulting from a change in the First Lien Net Leverage Ratio shall be effective during the period commencing on and including the Business Day following the date of delivery to the Administrative Agent pursuant to Section 5.04(a) or Section 5.04(b) of the consolidated financial statements and related certificate indicating such change and ending on the date immediately preceding the effective date of the next such change. Notwithstanding the foregoing, the Applicable Rate, at the option of the Administrative Agent or the Required Revolving Lenders, shall be based on the rates per annum set forth in Category 1 if the Lead Borrower fails to deliver the consolidated financial statements required to be delivered pursuant to Section 5.04(a) or Section 5.04(b) or any such related certificate required to be delivered pursuant hereto, in each case within the time periods specified herein for such delivery, during the period commencing on and including the date that is three (3) Business Days after the occurrence of a Default resulting from such failure and until the delivery thereof. Notwithstanding anything to the contrary contained above in this definition or elsewhere in this Agreement, if it is subsequently determined that the First Lien Net Leverage Ratio set forth in any certificate delivered to the Administrative Agent is inaccurate for any reason and the result thereof is that the Revolving Lenders received interest or fees for any period based on an Applicable Rate that is less than that which would have been applicable had the First Lien Net Leverage Ratio been accurately determined (for the purposes of this paragraph, an “Applicable Period”), then, (i) for all purposes of this Agreement, the “Applicable Rate” for any day occurring within the period covered by such certificate shall retroactively be deemed to be the relevant percentage as based upon the accurately determined First Lien Net Leverage Ratio for such period, and (ii) any shortfall in the interest or fees theretofore paid by the Borrowers for the relevant period as a result of the miscalculation of the First Lien Net Leverage Ratio shall be paid to the Administrative Agent promptly upon written demand (and in no event later than five (5) Business Days after written demand) any additional interest owing as a result of such increased Applicable Rate for such Applicable Period, which payment shall be promptly applied by the Administrative Agent in accordance with the terms hereof; provided that, for the avoidance of doubt, there shall be no Default or Event of Default resulting from the obligations in this paragraph unless the foregoing payment obligation in clause (ii) of this paragraph is not complied with by the Borrowers within the time frame contemplated thereby.

Asset Sale” shall mean the sale, transfer or other disposition (by way of merger or otherwise) by the Lead Borrower or any of its Restricted Subsidiaries to any Person other than the Lead Borrower or any Subsidiary Guarantor of (a) any Equity Interests of any of the Restricted Subsidiaries (other than directors’ qualifying shares) or (b) any other assets of the Lead Borrower or any of its Restricted Subsidiaries.

Assignment and Acceptance” shall mean an assignment and acceptance entered into by a Lender and an Eligible Assignee, and accepted by the Administrative Agent, in the form of Exhibit B or such other form as shall be approved by the Administrative Agent.

Available Amount Basket” shall mean, at any date (the “Reference Date”), the sum of:

(a)        $15,000,000; 

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(b)        Cumulative Retained Excess Cash Flow Amount; plus

 

(c)        the amount of any capital contributions or Net Cash Proceeds from Permitted Equity Issuances (or issuances of debt securities that have been converted into or exchanged for Qualified Capital Stock) received or made by the Lead Borrower (or any direct or indirect parent thereof and contributed by such parent to the Lead Borrower) during the period from and including the Business Day immediately following the Closing Date through and including the Reference Date; plus

(d)        to the extent not (A) included in clause (b) above or (B) already reflected as a return of capital with respect to such Investment for purposes of determining the amount of such Investment, the aggregate amount of all cash dividends and other cash distributions received by the Lead Borrower or any of its Restricted Subsidiaries from any Minority Investments or Unrestricted Subsidiaries during the period from and including the Business Day immediately following the Closing Date through and including the Reference Date; plus

(e)        to the extent not (A) included in clause (b) above or (B) already reflected as a return of capital with respect to such Investment for purposes of determining the amount of such Investment, the aggregate amount of all cash repayments of principal received by the Lead Borrower or any of its Restricted Subsidiaries from any Minority Investments or Unrestricted Subsidiaries during the period from and including the Business Day immediately following the Closing Date through and including the Reference Date in respect of loans or advances made by the Lead Borrower or any of its Restricted Subsidiaries to such Minority Investments or Unrestricted Subsidiaries; plus

(f)        to the extent not (A) included in clause (b) above, (B) already reflected as a return of capital with respect to such Investment for purposes of determining the amount of such Investment or (C) required to be applied to prepay Term Loans in accordance with Section 2.13(a), the aggregate amount of all Net Cash Proceeds received by the Lead Borrower or any of its Restricted Subsidiaries in connection with the sale, transfer or other disposition of its ownership interest in any Minority Investment or Unrestricted Subsidiary during the period from and including the Business Day immediately following the Closing Date through and including the Reference Date; plus

(g)        any Declined Amounts; minus

(h)        the aggregate amount of Restricted Payments made after the Closing Date and on or prior to such date pursuant to Section 6.06(a)(vii); minus

(i)        the aggregate amount of payments made after the Closing Date and on or prior to such date pursuant to Section 6.09(b)(i)(1); minus

(j)        the aggregate amount of Investments pursuant to Section 6.04(n)(y) after the Closing Date and on or prior to such date.

Availability Period” means the period from and including the Amendment No. 3 Effective Date to but excluding the earlier of the Revolving Credit Facility Maturity Date and the date of termination of the Revolving Commitments.

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

“Bankruptcy Event” means, with respect to any Person, such Person becomes the subject of a voluntary or involuntary bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator,

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custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business appointed for it, or, in the good faith determination of the Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment or has had any order for relief in such proceeding entered in respect thereof; provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof, unless such ownership interest results in or provides such Person 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 such Person (or such Governmental Authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person.

 

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

Borrower Materials” shall have the meaning assigned to such term in Section 9.01.

Borrowers” shall have the meaning assigned to such term in the introductory statement hereto.

Borrowing” shall mean Loans of the same Class and Type made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

Borrowing Request” shall mean a request by the Lead Borrower (on behalf of itself or WAPA PR) in accordance with the terms of Section 2.03 or Section 10.03, as applicable, and in each case substantially in the form of Exhibit C, or such other form as shall be approved by the Administrative Agent.

Breakage Event” shall have the meaning assigned to such term in Section 2.16.

Business Day” shall mean (i) any day other than a Saturday, Sunday or day on which banks in New York City are authorized or required by law to close and (ii) if such day relates to any interest rate settings as to a Eurodollar Loan denominated in Dollars, any fundings, disbursements, settlements and payments in Dollars in respect of any such Eurodollar Loan, or any other dealings in Dollars to be carried out pursuant to this Agreement in respect of any such Eurodollar Loan, shall mean any such day described in clause (i) above that is also a London Banking Day.

Capital Expenditures” shall mean, for any period, the additions to property, plant and equipment and other capital expenditures of the Lead Borrower and its Restricted Subsidiaries that are (or should be) set forth in a consolidated statement of cash flows of the Lead Borrower for such period prepared in accordance with GAAP but excluding in each case any such expenditure made to restore, replace or rebuild property to the condition of such property immediately prior to any damage, loss, destruction or condemnation of such property, to the extent such expenditure is made with insurance proceeds, condemnation awards or damage recovery proceeds relating to any such damage, loss, destruction or condemnation.

Capital Lease Obligations” of any Person shall mean the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

Cash Equivalents” shall mean:

(a)        direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America (or by any agency thereof to the extent such obligations are backed by the full faith and credit of the United States of America), in each case maturing within one year from the date of issuance thereof;

 

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(b)        investments in commercial paper maturing within 270 days from the date of issuance thereof and having, at such date of acquisition, the highest credit rating obtainable from S&P or from Moody’s;

 

(c)        investments in certificates of deposit, banker’s acceptances and time deposits maturing within one year from the date of acquisition thereof issued or guaranteed by or placed with, and money market deposit accounts issued or offered by, the Administrative Agent or any domestic office of any commercial bank organized under the laws of the United States of America or any State thereof that has a combined capital and surplus and undivided profits of not less than $500,000,000 and that issues (or the parent of which issues) commercial paper rated at least “Prime 1” (or the then equivalent grade) by Moody’s or “A 1” (or the then equivalent grade) by S&P;

(d)        fully collateralized repurchase agreements with a term of not more than 30 days for securities described in clause (a) above and entered into with a financial institution satisfying the criteria of clause (c) above;

(e)       investments in “money market funds” within the meaning of Rule 2a-7 of the Investment Company Act of 1940, as amended, substantially all of whose assets are invested in investments of the type described in clauses (a) through (d) above; and

(f)       other short-term investments utilized by Foreign Subsidiaries in accordance with normal investment practices for cash management in investments of a type analogous to the foregoing.

Cash Management Bank” shall mean any Person that is an Agent, a Lender, an Amendment No. 2 Lead Arranger or an Affiliate of any of the foregoing on the Amendment No. 2 Effective Date or at the time it initially provides any Cash Management Services, in its capacity as a party thereto, whether or not such Person subsequently ceases to be an Agent, a Lender, an Amendment No. 2 Lead Arranger or an Affiliate of any of the foregoing.

Cash Management Obligations” shall mean obligations owed by the Lead Borrower or any of its Restricted Subsidiaries to any Cash Management Bank in respect of or in connection with any Cash Management Services and designated by the Cash Management Bank and the Lead Borrower in writing to the Administrative Agent as “Cash Management Obligations.”

Cash Management Services” shall mean any agreement or arrangement to provide cash management services, including treasury, depository, overdraft, credit card processing, credit or debit card, purchase card, electronic funds transfer and other cash management arrangements.

Casualty Event” shall mean any event that gives rise to the receipt by the Lead Borrower or any of its Restricted Subsidiaries of any insurance proceeds or condemnation awards in respect of any equipment, fixed assets or real property (including any improvements thereon) to replace or repair such equipment, fixed assets or real property.

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

CFC Holding Company” shall mean with respect to the Term Loans any Subsidiary of the Lead Borrower that owns one or more CFCs, either directly or indirectly through other entities that are disregarded entities or partnerships for U.S. federal income tax purposes, and substantially all the assets of such entities (excluding equity interests in each other) consist of equity interests of such CFCs.

Change in Control” shall be deemed to have occurred if (a) any “person” or “group” (within the meaning of Rule 13d-5 of the Securities Exchange Act of 1934 as in effect on the Closing Date), other than the Permitted Investors, shall own, directly or indirectly, beneficially or of record, shares representing the greater of (i) more than 35% of the aggregate ordinary voting power represented by the issued and outstanding capital stock of the Parent and (ii) more than the percentage of the aggregate ordinary voting power represented by the issued and outstanding capital stock of the Parent directly or indirectly owned by the Permitted Investors, (b) a majority of the seats (other 

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than vacant seats) on the board of directors of the Parent shall at any time be occupied by persons who were neither (i) nominated by the board of directors of the Parent (or any committee thereof with the authority to nominate directors) or the Permitted Investors nor (ii) appointed by directors so nominated, (c) any change in control (or similar event, however denominated) with respect to the Parent, Holdings or the Lead Borrower shall occur under and as defined in any indenture or agreement in respect of Material Indebtedness (including any Permitted First Priority Refinancing Debt, any Permitted Second Priority Refinancing Debt, any Permitted Unsecured Refinancing Debt, any New Incremental Notes and any Permitted Ratio Debt), (d) Parent shall cease to directly own, beneficially and of record, 100% of the issued and outstanding Equity Interests of Holdings, (e) Holdings shall cease to directly own, beneficially and of record, 100% of the issued and outstanding Equity Interests of the Lead Borrower or (f) the Lead Borrower shall cease to directly or indirectly own, beneficially and of record, 100% of the issued and outstanding Equity Interests of WAPA PR.

 

Change in Law” shall mean (a) the adoption of any law, rule or regulation after the Closing Date, (b) any change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the Closing Date or (c) compliance by any Lender or Issuing Bank (or, for purposes of Section 2.14, by any lending office of such Lender or Issuing Bank or by such Lender’s or Issuing Bank’s holding company, if any) with any request, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the Closing Date. For purposes of this definition and Section 2.14, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith or in implementation thereof, and (ii) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case, pursuant to Basel III, shall in each case described in clauses (i) and (ii) above, be deemed to be a “Change in Law,” regardless of the date enacted, adopted or issued, provided that increased costs as a result of any Change in Law pursuant to clause (i) or (ii) above, shall only be reimbursable by the Loan Parties to the extent the applicable Lender is requiring reimbursement therefor from similarly situated borrowers under comparable syndicated credit facilities.

Charges” shall have the meaning assigned to such term in Section 9.09.

Class” shall mean (a) when used with respect to Lenders, refers to whether such Lenders hold a particular Class of Commitments or Loans, (b) when used with respect to Commitments, refers to whether such Commitments are Term B-1 Commitments, Other Term Loan Commitments or Revolving Commitments and (c) when used with respect to Loans, refers to whether such Loans are Term B Loans, Term B-1 Loans (including Add-on Term B-1 Loans), Other Term Loans, Extended Term Loans or Revolving Loans, in each case, under this Agreement, of which such Loan or Commitment shall be a part.

Closing Date” shall mean July 30, 2013.

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

Collateral” shall mean all the “Collateral” as defined in any Security Document and shall also include the Mortgaged Properties.

Collateral and Guarantee Requirement” shall mean, at any time, the requirement that:

(a)       the Collateral Agent shall have received each Security Document required to be delivered on the Closing Date pursuant to Section 4.02 or pursuant to Section 5.10 or Section 5.13 or Section 5.16 at such time, duly executed by each Loan Party thereto;

(b)       all Obligations shall have been unconditionally guaranteed by Holdings, each Restricted Subsidiary of a Borrower that is a wholly owned Material Domestic Subsidiary and not an Excluded Subsidiary including those that are listed on Schedule 1.01(b) hereto (each, a “Guarantor”), and any Subsidiary of a Borrower that Guarantees any Indebtedness incurred by such Borrower pursuant to any Credit Agreement Refinancing Indebtedness (or any Permitted Refinancing thereof);

 

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(c)       the Obligations and the Guaranty shall have been secured by a first-priority security interest (subject to nonconsensual Liens permitted by Section 6.02) in (i) all the Equity Interests of the Lead Borrower, (ii) all Equity Interests of each direct, wholly owned Domestic Subsidiary (other than a Domestic Subsidiary described in the following clause (iii)(A)) that is directly owned by a Borrower or any Subsidiary Guarantor and (iii) 65% of the issued and outstanding Equity Interests of (A) each wholly owned Domestic Subsidiary that is directly owned by a Borrower or by any Subsidiary Guarantor and that is a disregarded entity for United States federal income tax purposes and substantially all of the assets of such Domestic Subsidiary consist of Equity Interests in one or more Foreign Subsidiaries that are CFCs and (B) each wholly owned Foreign Subsidiary that is directly owned by a Borrower or by any Subsidiary Guarantor;

 

 (d)       except to the extent otherwise provided hereunder, including subject to Liens permitted by Section 6.02, or under any Security Document, the Obligations and the Guaranty shall have been secured by a perfected first-priority security interest (to the extent such security interest may be perfected by delivering certificated securities, filing financing statements under the Uniform Commercial Code or making any necessary filings with the United States Patent and Trademark Office or United States Copyright Office or the execution and delivery of control agreements) in substantially all tangible and intangible personal property of each Borrower and each Guarantor including accounts (other than Excluded Accounts), inventory, equipment, investment property, contract rights, applications and registrations of intellectual property filed in the United States, other general intangibles, and proceeds of the foregoing), in each case, with the priority required by the Security Documents, in each case subject to exceptions and limitations otherwise set forth in this Agreement and the Security Documents; and

(e)       the Collateral Agent shall have received (i) counterparts of a Mortgage with respect to each Material Owned Real Property (other than any Excluded Property), if any, required to be delivered pursuant to Section 5.10 and 5.13(b) (the “Mortgaged Properties”) duly executed and delivered by the record owner of such property; provided, that, with respect to the PR Mortgage, which the Loan Parties represent has been duly filed and recorded in the corresponding Section of the Puerto Rico Registry of Property, (except for the Deed of Amendment, which has been filed and is pending recordation in the corresponding Section of the Puerto Rico Registry of Property) the Collateral Agent shall have received the PR Mortgage Note, without any endorsement to any party, counterparts of the PR Mortgage Note Pledge and Security Agreement, and the corresponding financing statement, (ii) a policy or policies of title insurance issued by a nationally recognized title insurance company insuring the Lien of each such Mortgage as a valid Lien on the property described therein, free of any other Liens except as expressly permitted by Section 6.02, together with such endorsements, coinsurance and reinsurance as the Collateral Agent may reasonably request, and (iii) such surveys, abstracts, appraisals (if required under FIRREA), flood certifications under Regulation H of the Board (together with evidence of federal flood insurance for any such property located in a flood hazard area) and such customary legal opinions and other documents as the Collateral Agent may reasonably request with respect to any such Mortgaged Property.

The foregoing definition shall not require the creation, perfection or maintenance of pledges of or security interests in, or the obtaining of title insurance, surveys, abstracts or appraisals with respect to, Excluded Property and any other particular assets if and for so long as, in the reasonable judgment of the Collateral Agent and the Borrower, the cost of creating, perfecting or maintaining such pledges or security interests in such assets or obtaining title insurance, surveys abstracts or appraisals in respect of such assets shall be excessive in view of the fair market value (as determined by the Borrowers in its reasonable judgment) of such assets or the practical benefit to the Lenders afforded thereby.

The Collateral Agent may grant extensions of time for the perfection of security interests in or the obtaining of title insurance and surveys with respect to particular assets (including extensions beyond the Closing Date for the perfection of security interests in the assets of the Loan Parties on such date) where it reasonably determines, in consultation with the Borrower, that perfection cannot be accomplished without undue effort or expense by the time or times at which it would otherwise be required by this Agreement or the Security Documents.

Collateral Agent” shall mean JPMorgan Chase Bank, N.A. (or any successor thereto in such capacity).

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Collateral Coverage Requirement” shall mean, as of any date, the requirement that (x) the Consolidated Total Assets of (or attributable to) the Loan Parties constitutes at least 50.0% of the Consolidated Total Assets of the Lead Borrower and its Restricted Subsidiaries as of such date and (y) the Consolidated EBITDA of the Loan Parties constitutes at least 50.0% of the Consolidated EBITDA of the Lead Borrower and its Restricted Subsidiaries for the Test Period most recently ended prior to such date for which the financial statements and certificates required by Section 5.04(a) or 5.04(b), as the case may be, have been delivered.

 

Commitment” shall mean the Term B-1 Commitments, any Other Term Loan Commitment, any Incremental Term Loan Commitment and any Incremental Revolving 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.

Communications” shall have the meaning assigned to such term in Section 9.01.

Communications Act” shall mean the Communications Act of 1934, as amended.

Company” shall mean any corporation, limited liability company, partnership or other business entity (or the adjectival form thereof), where appropriate.

Company Competitor” shall mean any person that competes in any material respect with the business of the Borrowers and their Subsidiaries.

Compliance Date” means the last day of any fiscal quarter (commencing with the last day of the first full fiscal quarter of Holdings ending after the Amendment No. 3 Effective Date) if on such day the aggregate amount of Revolving Loans and/or L/C Exposure (excluding up to $5,000,000 of undrawn Letters of Credit and other Letters of Credit which have been cash collateralized or backstopped) exceeds 35% of the aggregate Revolving Commitments.

Confidential Information Memorandum” shall mean the Confidential Information Memorandum of the Lead Borrower dated July, 2013.

Consolidated Cash Taxes” shall mean, as of any date for the applicable period ending on such date with respect to the Lead Borrower and it Restricted Subsidiaries on a consolidated basis, the aggregate of all taxes based on income, profits or capital of the Lead Borrower and its Restricted Subsidiaries (including (i) federal, state, franchise, excise and similar taxes and foreign withholding taxes, (ii) penalties and interest related to such taxes or arising from any tax examinations and (iii) taxes in respect of repatriated funds), paid in cash during such period to the extent they exceed the amount of taxes deducted in determining Consolidated Net Income for such period.

Consolidated Current Assets” shall mean, with respect to the Lead Borrower and its Restricted Subsidiaries on a consolidated basis at any date of determination, all assets (other than cash and Cash Equivalents) that would, in accordance with GAAP, be classified on a consolidated balance sheet of the Lead Borrower and its Restricted Subsidiaries as current assets at such date of determination, other than amounts related to current or deferred Taxes based on income or profits.

Consolidated Current Liabilities” shall mean, with respect to the Lead Borrower and its Restricted Subsidiaries on a consolidated basis, all liabilities in accordance with GAAP that would be classified as current liabilities on the consolidated balance sheet of such Person, but excluding (a) the current portion of Indebtedness to the extent reflected as a liability on the consolidated balance sheet of such Person, (b) the current portion of interest, (c) accruals for current or deferred taxes based on income or profits, (d) accruals of any costs or expenses related to restructuring reserves, (e) deferred revenue, (f) escrow account balances and (g) any letter of credit obligations or swing line loans or revolving loans under any revolving credit facility.

Consolidated EBITDA” shall mean, for any period, Consolidated Net Income for such period (without giving effect to (x) any extraordinary gains (or losses) and any related provisions for taxes on such extraordinary

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gains (or losses), and (y) any gains or losses from sales of assets other than inventory sold in the ordinary course of business), adjusted by:

 

(A)       adding thereto (in each case to the extent deducted in determining Consolidated Net Income for such period (other than with respect to clauses (viii) and (xii) below)), without duplication, the amount of:

(i) total interest expense (inclusive of amortization of deferred financing fees and other original issue discount and banking fees, charges and commissions (e.g., letter of credit fees and commitment fees, non-cash interest payments, the interest component of Capital Lease Obligations, net payments, if any, pursuant to interest rate protection agreements with respect to Indebtedness, the interest component of any pension or other post-employment benefit expense, in each case to the extent included as interest expense under GAAP)) of the Lead Borrower and its Restricted Subsidiaries determined on a consolidated basis for such period;

(ii) provision for taxes based on income, profits or capital and foreign withholding taxes and franchise, state single business unitary and similar taxes for the Lead Borrower and its Restricted Subsidiaries determined on a consolidated basis for such period;

(iii) all depreciation and amortization expense of the Lead Borrower and its Restricted Subsidiaries determined on a consolidated basis for such period, including but not limited to amortization or impairment of intangibles (including, but not limited to goodwill), non-cash write offs of debt discounts and debt issuances, non-cash costs and commissions, non-cash discounts and other non-cash fees and charges with respect to Indebtedness and Hedging Agreements;

(iv) other unusual or non-recurring cash charges, or expenses of the Lead Borrower and its Restricted Subsidiaries during such period;

(v) the amount of all other non-cash charges, losses or expenses (including non-cash employee and officer equity compensation expense (including stock options), or asset write-offs, write-ups or write-downs) of the Lead Borrower and its Restricted Subsidiaries determined on a consolidated basis for such period (but excluding any additions to bad debt reserves or bad debt expense and any non-cash charge to the extent it represents amortization of a prepaid cash item that was paid in a prior period unless such prepaid cash item was deducted in such prior period);

(vi) cash restructuring charges or reserves, including any restructuring costs and integration costs incurred in connection with, Permitted Acquisitions or Specified Dispositions or other Specified Transactions occurring after the last day of the period covered by the Historical Financial Statements, costs related to the closure and/or consolidation of facilities, retention charges, contract termination costs, recruiting, relocation, severance and signing bonuses and expenses, transaction fees and expenses in each case to the extent established or incurred after March 31, 2013; provided that the aggregate amount of any such charges or reserves under this clause (vi), when aggregated with any add-backs or adjustments pursuant to clause (vii) below, shall not exceed in any period 20.0% of Consolidated EBITDA for such period (calculated before giving effect to any such add-backs and adjustments);

(vii) the amount of cost savings, operating expense reductions, other operating improvements and synergies projected by the Lead Borrower in good faith to be realized in connection with any Specified Transaction or the implementation of an operational initiative (including the termination, abandonment or discontinuance of operations and product lines) after the Closing Date (calculated on a Pro Forma Basis as though such cost savings, operating expense reductions, other operating improvements and synergies had been realized on the first day of such period and as if such cost savings, operating expense reductions, other operating improvements and synergies were realized during the entirety of such period), net of the amount of actual benefits realized during such period from such actions; provided that (A) a duly completed

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certificate signed by a Responsible Officer of the Lead Borrower shall be delivered to the Administrative Agent together with the Officer’s Certificate required to be delivered pursuant to Section 5.04(c), certifying that (x) such cost savings, operating expense reductions, other operating improvements and synergies are reasonably identifiable, reasonably anticipated to be realizable and factually supportable in the good faith judgment of the Lead Borrower, and (y) such actions are to be taken within 12 months after the consummation of the Specified Transaction or the implementation of an operational initiative, which is expected to result in such cost savings, expense reductions, other operating improvements or synergies, (B) projected amounts (and not yet realized) may no longer be added in calculating Consolidated EBITDA pursuant to this clause (vii) to the extent occurring more than four (4) Fiscal Quarters after the specified action taken in order to realize such projected cost savings, operating expense reduction, other operating improvements and synergies and (C) no cost savings, operating expense reductions and synergies shall be added pursuant to this clause (vii) to the extent duplicative of any expenses or charges otherwise added to Consolidated EBITDA, whether through a pro forma adjustment or otherwise, for such period; provided that the aggregate amount of all add-backs made pursuant to this clause (vii) shall not exceed in any period 20.0% of Consolidated EBITDA, when aggregated with any add-backs or adjustments pursuant to clause (vi) above, for such period (for this purpose, determined without regard to this clause (vii));

 

(viii) other accruals, up-front fees, transaction costs, commissions, expenses, premiums or charges related to any equity offering, permitted investment, acquisition, disposition, recapitalization or incurrence, repayment, amendment or modification of Indebtedness permitted by this Agreement (whether or not successful, and including costs and expenses of the Administrative Agent and Lenders that are reimbursed);

(ix) Transaction Expenses;

(x) expenses to the extent covered by contractual indemnification, insurance or refunding provisions in favor of the Lead Borrower or any of its Subsidiaries and actually paid by such third parties;

(xi) to the extent covered by business interruption insurance and actually reimbursed or otherwise paid, expenses or losses relating to business interruption;

(xii) to the extent that any Holdings Specified Expenses would have been added back to Consolidated EBITDA pursuant to clauses (i) through (xi) above had such change, tax or expense been incurred directly by the Lead Borrower, such Holdings Specified Expenses; and

(xiii) solely for purposes of the Financial Covenant and the Applicable Rate, for any period ending on or prior to June 30, 2023, the amount of losses attributable to the business acquired in the Specified Acquisition that reduced consolidated operating income and were not otherwise added back pursuant to any clause set forth above so long as the aggregate amount of the increase to Consolidated EBITDA for such period as a result of the adjustment in this clause (xiii) does not exceed 15% of Consolidated EBITDA for such period (calculated after giving effect to such addback); and

(B)        subtracting therefrom (to the extent not otherwise deducted in determining Consolidated Net Income for such period and without duplication the amount of (i) all cash payments or cash charges made (or incurred) by the Lead Borrower or any of its Restricted Subsidiaries for such period on account of any non-cash charges added back to Consolidated EBITDA in a previous period, (ii) income and gain items corresponding to those referred to in clauses (A)(iv) and (A)(v) above (other than (i) accrual of revenue and amortization of deferred revenue in the ordinary course or (ii) reversals of prior accruals or reserves, to the extent such accruals or reserves had the effect of reducing Consolidated EBITDA in a prior period), (iii) gains related to pensions and other post-employment benefits, (iv) federal, state, local and foreign income tax credits and (v) the amount of any Holdings Specified Expenses,

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provided that to the extent included in Consolidated Net Income, there shall be excluded in determining Consolidated EBITDA for any period any adjustments resulting from the application of Statement of Financial Accounting Standards No. 133 and International Accounting Standard No. 39 and their respective related pronouncements and interpretations.

 

Notwithstanding anything to the contrary contained above, for purposes of determining Consolidated EBITDA for any Test Period which ends prior to the first anniversary of the Closing Date, Consolidated EBITDA for all portions of such period occurring prior to the Closing Date shall be calculated in accordance with the definition of “Test Period” contained herein.

Consolidated Net Income” shall mean, for any period, the net income (or loss) of the Lead Borrower and its Restricted Subsidiaries determined on a consolidated basis (after deduction for minority interests) for such period (taken as a single accounting period) in accordance with GAAP, provided that the following items shall be excluded in computing Consolidated Net Income (without duplication):

(i) the net income (or loss) for such period of any Person that is not a Restricted Subsidiary of the Lead Borrower or that is accounted for by the equity method of accounting; provided that Consolidated Net Income shall be increased by the amount of dividends or distributions that are actually paid in cash or Cash Equivalents by such Person to the Lead Borrower or one of its Restricted Subsidiaries during such period;

(ii) except for determinations expressly required to be made on a Pro Forma Basis, the net income (or loss) of any Person accrued prior to the date it becomes a Restricted Subsidiary of the Lead Borrower or all or substantially all of the property or assets of such Person are acquired by a Restricted Subsidiary of the Lead Borrower;

(iii) the net income of any Restricted Subsidiary of the Lead Borrower that is not also a Guarantor to the extent that the declaration or payment of cash dividends or similar cash distributions by such Restricted Subsidiary of such net income is not at the time permitted by the operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation or law applicable to such Restricted Subsidiary;

(iv) any net income or loss attributable to the early extinguishment or cancellation of Indebtedness; and

(v) purchase accounting effects of adjustments to deferred revenue required or permitted by GAAP.

Consolidated Total Assets” shall mean, as of any date, the amount which, in accordance with GAAP, would be set forth under the caption “Total Assets” (or any like caption) on a consolidated balance sheet of the Lead Borrower and its Restricted Subsidiaries, as of the end of the most recently ended Fiscal Quarter for which internal financial statements are available.

Control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise, and the terms “Controlling” and “Controlled” shall have meanings correlative thereto.

Converted Term B Loan” shall mean each Term B Loan held by an Amendment No. 2 Consenting Lender on the Amendment No. 2 Effective Date immediately prior to the effectiveness of Amendment No. 2 (or, if less, the amount notified to such Lender by the Administrative Agent prior to the Amendment No. 2 Effective Date).

Corrective Term Loan Extension Amendment” shall have the meaning assigned to such term in Section 2.25(e).

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Credit Agreement Refinancing Indebtedness” shall mean (a) Permitted First Priority Refinancing Debt, (b) Permitted Second Priority Refinancing Debt, (c) Permitted Unsecured Refinancing Debt or (d) other Indebtedness incurred pursuant to a Refinancing Amendment (including, without limitation, Other Term Loans), in each case, issued, incurred or otherwise obtained (including by means of the extension or renewal of existing Indebtedness) in exchange for, or to extend, renew, replace or refinance, in whole or part, existing Term B-1 Loans, Incremental Revolving Commitments, Incremental Term Loans, New Term Loans or Other Term Loans, or any then existing Credit Agreement Refinancing Indebtedness (“Refinanced Debt”); provided that (i) such Indebtedness does not mature prior to the maturity date of, or have a shorter Weighted Average Life to Maturity than the Refinanced Debt (other than to the extent of nominal amortization for periods where amortization has been eliminated or reduced as a result of prepayments of such Refinanced Debt), (ii) such Indebtedness shall not have a greater principal amount than the principal amount of the Refinanced Debt plus accrued interest, fees and premiums (if any) thereon and reasonable fees and expenses associated with the refinancing, extension, renewal or replacement, unless otherwise permitted hereby and (iii) such Refinanced Debt shall be repaid, defeased or satisfied and discharged, and all accrued interest, fees and premiums (if any) in connection therewith shall be paid, on the date such Credit Agreement Refinancing Indebtedness is issued, incurred or obtained.

 

Credit Event” shall have the meaning assigned to such term in Section 4.01.

Credit Party” means the Administrative Agent, each Issuing Bank or any other Lender.

Cumulative Retained Excess Cash Flow Amount” shall mean, at any date, an amount, not less than zero, determined on a cumulative basis equal to the amount of Excess Cash Flow for all fiscal years of the Lead Borrower starting with the fiscal year ending December 31, 2014 that was not (and, in the case of any fiscal year of the Lead Borrower where the respective required date of prepayment has not yet occurred pursuant to Section 2.13(b), will not on such date of required prepayment be) required to be applied as a mandatory prepayment in accordance with Section 2.13(b) (which Section 2.13(b) shall, for purposes of this definition, be construed without giving effect to any deduction pursuant to clause (B) of such Section 2.13(b)).

Debtor Relief Laws” shall mean the Bankruptcy Code of the United States 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 or other applicable jurisdictions from time to time in effect and affecting the rights of creditors generally.

Declined Amounts” shall have the meaning specified in Section 2.13(g).

Declining Lender” shall have the meaning specified in Section 2.13(g).

Deed of Amendment” shall mean that certain Deed of Amendment of Mortgage Number 6, executed before Notary Public Gladys O. Fontanez Reyes on June 28, 2011 by and between Televicentro of Puerto Rico, LLC, as the mortgagor, and The Bank of Nova Scotia, as then holder of the PR Mortgage Note.

Deed of Mortgage” shall mean that certain Deed of Mortgage Number 6, executed before Notary Public Luis Morales-Steinmann on March 30, 2007 by Televicentro of Puerto Rico, LLC, as the mortgagor.

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

Defaulting Lender” means any Revolving Lender that (a) has failed, within two Business Days of the date required to be funded or paid, to (i) fund any portion of its Revolving Loans, (ii) fund any portion of its participations in Letters of Credit or (iii) pay over to any Credit Party any other amount required to be paid by it hereunder, (b) has notified the Borrowers or any Credit Party in writing, or has made a public statement to the effect, that it does not intend or expect to comply with any of its funding obligations under this Agreement or generally under other agreements in which it commits to extend credit, (c) has failed, within three Business Days after request by a Credit Party, acting in good faith, to provide a certification in writing from an authorized officer of such Revolving Lender that it will comply with its obligations (and is financially able to meet such obligations as of the

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date of certification) to fund prospective Revolving Loans and participations in then outstanding Letters of Credit under this Agreement, provided that such Revolving Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon such Credit Party’s receipt of such certification in form and substance satisfactory to it and the Administrative Agent, or (d) has become the subject of (A) a Bankruptcy Event or (B) a Bail-In Action.

 

Deposit Account” shall mean all “deposit accounts” as such term is defined in the Uniform Commercial Code as in effect on the date hereof in the State of New York (other than Excluded Accounts).

Deposit Account Control Agreement” shall mean a “control agreement” in form and substance reasonably acceptable to the Administrative Agent and the Lead Borrower and containing terms providing “control” (for purposes of the UCC) over the Deposit Account governed by such Deposit Account Control Agreement.

Designated Acquisition” shall mean any Permitted Acquisition or similar Investment that is not, in accordance with the agreement governing such Permitted Acquisition or similar Investment, subject to a financing contingency and that has been designated by the Lead Borrower in writing to the Agent as a “Designated Acquisition” which designation shall include a description of any Indebtedness (the “Designated Indebtedness”) expected to be incurred to finance such Designated Acquisition.

Designated Non-cash Consideration” shall mean the fair market value (as determined in good faith by the applicable Borrower) of non-cash consideration received by the Borrowers or any of their respective Restricted Subsidiaries in connection with an Asset Sale that is so designated as Designated Non-cash Consideration pursuant to an officer’s certificate executed by a Responsible Officer of the Lead Borrower and delivered to the Administrative Agent, setting forth the basis of such valuation, less the amount of Cash Equivalents received in connection with a subsequent sale of such Designated Non-cash Consideration.

Disposition” or “Dispose” shall mean the sale, transfer, license, lease or other disposition of any property by any Person, including any sale, assignment, transfer or other disposal, with or without recourse, of any notes or accounts receivable or any rights and claims associated therewith.

Disqualified Institution” shall mean (a) each bank, financial institution or other institutional lender and Company Competitor or Affiliate of a Company Competitor identified in writing to the Administrative Agent prior to the Amendment No. 2 Effective Date and (b) any other person designated in writing to the Administrative Agent after the Amendment No. 2 Effective Date by the Lead Borrower by e-mail sent to JPMDQ_Contact@jpmorgan.com (or such other address as the Administrative Agent may from time to time notify the Lead Borrower) to the extent such person is or becomes a Company Competitor or is or becomes an Affiliate of a Company Competitor, which designation shall become effective three days after receipt by the Administrative Agent of such written supplement, but which shall not apply retroactively to disqualify any persons that have previously acquired an assignment or participation interest in the Loans or is party to a pending trade; provided that a Company Competitor or an Affiliate of a Company Competitor shall not include any bona fide debt fund or investment vehicle or other institutional lender or bank or financial institution that is engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of business which is managed, sponsored or advised by any person controlling, controlled by or under common control with such Company Competitor or Affiliate thereof, as applicable, and for which no personnel involved with the investment of such Company Competitor (i) makes (or has the right to make or participate with others in making) any investment decisions or (ii) will obtain access to any Information from such bona fide debt fund or investment vehicle or persons receiving Information hereunder.

Disqualified Stock” shall mean any Equity Interest that, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, (a) matures (excluding any maturity as the result of an optional redemption by the issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof (other than upon an asset sale or change in control, if such right is subject to the prior payment in full of the Obligations), in whole or in part, or requires the payment of any cash dividend or any other scheduled payment constituting a return of capital, in each case at any time on or prior to the first anniversary of the Maturity Date, or (b) is convertible into or exchangeable (unless at the sole option of the issuer thereof) for (i) debt securities or (ii) any Equity Interest referred to in clause (a) above, in each case at any time prior to the first anniversary of the Latest Maturity Date. 

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Dollars” or “$” shall mean lawful money of the United States of America.

 

Domestic Subsidiaries” shall mean all Subsidiaries incorporated or organized under the laws of the United States of America, any State thereof or the District of Columbia.

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

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

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

Effective Yield” shall mean, as to any Term Loan of any Class, the effective yield on such Term Loans as reasonably determined by the Administrative Agent (consistent with generally accepted financial practices), taking into account the applicable interest rate margins (but not any fluctuations in LIBO Rate), any interest rate floors, and all fees, including recurring, up-front or similar fees or original issue discount (amortized over the shorter of (x) the weighted average life of such loans and (y) the four years following the date of incurrence thereof) payable generally to Lenders making such loans, but excluding (i) any arrangement, structuring or other fees payable in connection therewith that are not generally shared with the Lenders thereunder and (ii) any customary consent fees paid generally to consenting Lenders.

Eligible Assignee” shall mean (i) any Lender, any Affiliate of any Lender and any Related Fund (any two or more Related Funds being treated as a single Eligible Assignee for all purposes hereof) and (ii) any commercial bank, insurance company, investment or mutual fund or other entity (other than a natural person) that extends credit or buys loans and that is approved by the Administrative Agent but excluding, (x) any Affiliated Lender, except to the extent expressly provided in Section 9.04(f), (y) Holdings, the Borrowers and their respective Subsidiaries, except to the extent expressly provided in Section 9.04(f) and (z) any Disqualified Institution.

Environmental Laws” shall mean all former, current and future federal, state, local and foreign laws (including common law), treaties, regulations, rules, ordinances, codes, decrees, judgments, directives, orders (including consent orders), and agreements in each case, relating to protection of the environment, natural resources, human or public health and safety or the presence, Release of, or exposure to, Hazardous Materials, or the generation, manufacture, processing, distribution, use, treatment, storage, transport, recycling or handling of, or the arrangement for such activities with respect to, Hazardous Materials.

Environmental Liability” shall mean all liabilities, obligations, damages, losses, claims, actions, suits, judgments, orders, fines, penalties, fees, expenses and costs (including administrative oversight costs, natural resource damages and remediation costs), whether contingent or otherwise, arising out of or relating to (a) compliance or non-compliance with any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials, (d) the Release of any Hazardous Materials or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

Equity Interests” shall mean shares of capital stock, partnership interests, membership interests in a limited liability company, beneficial interests in a trust or other equity interests in any Person, and any option, warrant or other right entitling the holder thereof to purchase or otherwise acquire any such equity interest.

ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the same may be amended from time to time.

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ERISA Affiliate” shall mean any trade or business (whether or not incorporated) that, together with the Borrower, is treated as a single employer under Section 414(b) or (c) of the Code, or solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414(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, with respect to a Plan, (b) the failure to satisfy the minimum funding standard (as defined in Section 412 or 430 of the Code or Section 303 or 304 of ERISA) with respect to any Plan, whether or not waived, (c) a determination that any Plan is in “at-risk status” or any Multiemployer Plan is in “endangered status” or “critical status” (as each is defined in Section 303 and 305 of ERISA, respectively), (d) the incurrence by the Lead Borrower or any of its ERISA Affiliates of any material liability under Title IV of ERISA with respect to the termination of any Plan or the withdrawal or partial withdrawal of the Lead Borrower or any of its ERISA Affiliates from any Plan or Multiemployer Plan, (e) the receipt by the Lead Borrower or any of its ERISA Affiliates from the PBGC or a plan administrator of any notice relating to the intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan, (f) the receipt by the Lead Borrower or any of its ERISA Affiliates of any notice, or the receipt by any Multiemployer Plan from the Lead Borrower or any of its ERISA Affiliates of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA or (g) the occurrence of a non-exempt “prohibited transaction” with respect to which the Lead Borrower or any of its Restricted Subsidiaries is a “disqualified person” (each within the meaning of Section 4975 of the Code) that results in material liability to the Borrower.

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

Eurodollar,” when used in reference to any Loan or Borrowing, shall refer to whether such Loan, or the Loans comprising such Borrowing, is bearing interest at a rate determined by reference to the Adjusted LIBO Rate.

Events of Default” shall have the meaning assigned to such term in Section 7.01.

Excess Cash Flow” shall mean, with respect to any Excess Cash Flow Payment Period, an amount, not less than zero, equal to:

(a)        the sum, without duplication, of (i) Consolidated Net Income of the Lead Borrower and its Restricted Subsidiaries for such Excess Cash Flow Payment Period, plus (ii) the amount of all non-cash charges (including depreciation, amortization and deferred tax expense) deducted in arriving at such Consolidated Net Income, plus (iii) the aggregate net amount of non-cash loss on Dispositions by the Lead Borrower and its Restricted Subsidiaries during such Excess Cash Flow Payment Period (other than sales of inventory in the ordinary course of business), to the extent deducted in arriving at such Consolidated Net Income, plus (iv) the aggregate amount of any non-cash loss for such period attributable to the early extinguishment of Indebtedness, Hedging Agreements or other derivative instruments, to the extent deducted in arriving at such Consolidated Net Income, plus (v) to the extent not otherwise included in determining Consolidated Net Income, the aggregate amount of cash receipts for such period attributable to Hedging Agreements or other derivative instruments, minus

(b)        the sum, without duplication (in each case, for the Lead Borrower and its Restricted Subsidiaries on a consolidated basis), of:

(i) Capital Expenditures, except to the extent made using proceeds, payments or any other amounts available from events or circumstances that were not included in determining Consolidated Net Income during such period (including any proceeds from Indebtedness), that are (A) actually made in cash during such Excess Cash Flow Payment Period or (B) committed although not actually made in cash during such Excess Cash Flow Payment Period, so long as such Capital Expenditures are actually made in cash within six months after the end of such Excess Cash Flow Payment Period; provided that (x) if any Capital Expenditures are deducted from Excess Cash Flow pursuant to (B) above, such amount shall be added to the Excess Cash Flow for the immediately succeeding Excess Cash Flow Payment Period if the expenditure is not

 

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actually made in cash within such six-month period and (y) no deduction shall be taken in the immediately succeeding Excess Cash Flow Payment Period when such amounts deducted pursuant to clause (B) are actually spent;

 

(ii) to the extent not otherwise deducted from Consolidated Net Income, Consolidated Cash Taxes;

(iii) the aggregate amount of all principal payments of Indebtedness of the Lead Borrower and its Restricted Subsidiaries (including (A) the principal component of payments in respect of Capital Lease Obligations, (B) the amount of any repayment of Loans pursuant to Section 2.11, (C) the amount of any mandatory prepayment of Loans pursuant to Section 2.13(a) to the extent required due to an Asset Sale that resulted in an increase to such Consolidated Net Income and not in excess of the amount of such increase and (D) the amount of any voluntary prepayments of Loans made by Holdings, any Borrower or any of their respective Subsidiaries pursuant to Section 9.04(f) (in an amount equal to the discounted amount actually paid in respect of the principal amount of such Loans) (provided that (I) such prepayments or repurchases are otherwise permitted hereunder and (II) such prepayments or repurchases are not made, directly or indirectly, using (1) proceeds, payments or any other amounts available from events or circumstances that were not included in determining Consolidated Net Income during such period (including any proceeds from Indebtedness) or (2) the Cumulative Retained Excess Cash Flow Amount) but excluding (X) all other prepayments of Loans (other than those specified in preceding clauses (iii)(C) and (D))and (Y) payments in respect of any Permitted Ratio Debt, any New Incremental Notes and Indebtedness constituting Permitted Second Priority Refinancing Debt, Permitted Unsecured Refinancing Debt or any Subordinated Indebtedness, except in each case to the extent permitted to be paid pursuant to Section 6.09 or occurring in connection with a refinancing of such Indebtedness permitted in accordance with the terms of this Agreement) made during such period, in each case except to the extent financed with the proceeds of Funded Debt of the Lead Borrower or any of its Restricted Subsidiaries;

(iv) to the extent not deducted in arriving at Consolidated Net Income, Restricted Payments made in cash during such period by the Lead Borrower to the extent that such Restricted Payments are made under Sections 6.06(a)(ii) and 6.06(a)(iii), solely to the extent made, directly or indirectly, with the net cash proceeds from events or circumstances that were included in the calculation of Consolidated Net Income;

(v) (A) the aggregate amount of any premium, make-whole or penalty payments actually paid in cash by any Borrower during such period that are required to be made in connection with any prepayment or satisfaction and discharge of Indebtedness of the Lead Borrower or any of its Restricted Subsidiaries (except to the extent financed with the proceeds of Funded Debt other than the Loans) to the extent that the amount so prepaid, satisfied or discharged is not deducted from Consolidated Net Income for purposes of calculating Excess Cash Flow and (B) to the extent included in determining Consolidated Net Income, the aggregate amount of any income for such period attributable to the early extinguishment of Indebtedness, Hedging Agreements or other derivative instruments (other than commodity Hedging Agreements);

(vi) cash payments made by the Lead Borrower or any of its Restricted Subsidiaries during such period (to the extent not deducted in arriving at such Consolidated Net Income) in satisfaction of non-current liabilities (excluding payments of Indebtedness for borrowed money) not made directly or indirectly using (1) proceeds, payments or any other amounts available from events or circumstances that were not included in determining Consolidated Net Income during such period (including any proceeds from Indebtedness) or (2) the Cumulative Retained Excess Cash Flow Amount;

(vii) to the extent not deducted in arriving at Consolidated Net Income, fees, expenses and purchase price adjustments paid in cash during such period by the Lead Borrower or any of its Restricted Subsidiaries in connection with the Transaction or, in each case to the extent

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permitted hereunder, any Investment permitted under Section 6.04, issuance of Equity Interests or issuance of Indebtedness (whether or not consummated) and any Restricted Payment made in cash by the Lead Borrower or any of its Restricted Subsidiaries pursuant to Sections 6.06(a)(ii) and 6.06(a)(iii) to pay any of the foregoing;

 

(viii) to the extent not deducted in arriving at Consolidated Net Income, the aggregate amount of expenditures actually made in cash from operations by the Lead Borrower or any of its Restricted Subsidiaries during such period (including expenditures for payment of financing fees) to the extent such expenditures are (1) not expensed during such period and (2) made with cash from operations;

(ix) cash from operations used by the Lead Borrower or any of its Restricted Subsidiaries or committed to be used by the Lead Borrower or any of its Restricted Subsidiaries to consummate a Permitted Acquisition or Investment permitted under Sections 6.04(e), (f), (l) or (n) (if such Permitted Acquisition or Investment has been consummated or committed to during such period prior to the date on which a prepayment of Loans would be required pursuant to Section 2.13(b) with respect to such Excess Cash Flow Payment Period); provided, however, that if any amount is deducted from Excess Cash Flow pursuant to this clause (ix) with respect to any Excess Cash Flow Payment Period as a result of a Permitted Acquisition or Investment that has been committed to be consummated but not yet actually consummated during such period then (x) such amount shall not be deducted from Excess Cash Flow pursuant to this clause (ix) as a result of such Permitted Acquisition or Investment, as the case may be, being actually consummated in the immediately succeeding Excess Cash Flow Payment Period and (y) such amount shall be added to Excess Cash Flow for the immediately succeeding Excess Cash Flow Payment Period if the Permitted Acquisition or Investment is not actually consummated during such succeeding period;

(x) the amount of cash payments made in respect of pensions and other postemployment benefits in such period to the extent not deducted in arriving at such Consolidated Net Income;

(xi) the amount of cash expenditures in respect of Hedging Agreements during such fiscal year to the extent they exceed the amount of expenditures expensed in determining Consolidated Net Income for such period;

(xii) the aggregate principal amount of all mandatory prepayments of Term Loans made during such Excess Cash Flow Payment Period pursuant to Section 2.13(b), or reinvestments of Net Cash Proceeds in lieu thereof, to the extent that the applicable Net Cash Proceeds resulted in an increase of Consolidated Net Income (and are not in excess of such increase) for such Excess Cash Flow Payment Period; and

(xiii) the aggregate net amount of any non-cash gains to the extent included in arriving at Consolidated Net Income; minus

(c)        any increase in Net Working Capital during such Excess Cash Flow Payment Period (measured as the excess, if any, of Net Working Capital at the end of such Excess Cash Flow Payment Period minus Net Working Capital at the beginning of such Excess Cash Flow Payment Period) or increases in long term accounts receivable and decreases in the long-term portion of deferred revenue for such period (other than any such increases or decreases, as applicable, arising from acquisitions or Dispositions of property by the Lead Borrower, and its Restricted Subsidiaries during such period), except as a result of the reclassification of items from short term to long term or vice versa; plus

(d)        any decrease in Net Working Capital during such Excess Cash Flow Payment Period (measured as the excess, if any, of Net Working Capital at the beginning of such Excess Cash Flow Payment Period minus Net Working Capital at the end of such Excess Cash Flow Payment Period) or decreases in long-term accounts receivable and increases in the long-term portion of deferred revenue for such period (other than any such decreases or increases, as applicable, arising from acquisitions or

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Dispositions of property by the Lead Borrower or any of its Restricted Subsidiaries completed during such period), except as a result of the reclassification of items from short term to long term or vice versa.

 

Excess Cash Flow Payment Date” shall mean the date occurring on the earlier to occur of (x) the delivery of the financial statements for such fiscal year pursuant to Section 5.04 and (y) 90 days after the end of each fiscal year of the Lead Borrower (commencing with the fiscal year of the Lead Borrower ending December 31, 2015).

Excess Cash Flow Payment Period” shall mean, with respect to the repayment required on each Excess Cash Flow Payment Date, the immediately preceding fiscal year of the Borrower.

Excluded Accounts” shall mean, (A) payroll and other employee wage and benefit accounts, (B) tax accounts, including, without limitation, sales tax accounts, (C) escrow accounts, (D) fiduciary or trust accounts and (E) Immaterial Accounts and, in the case of clauses (A) through (E), the funds or other property held in or maintained in any such account.

Excluded Property” shall mean, with respect to any Loan Party, (a) (i) any leasehold interest (including any ground lease interest) in real property, (ii) any fee-owned real property with a fair market value not in excess of $5,000,000 and (iii) any fixtures affixed to any real property to the extent (A) such real property has a fair market value below $5,000,000 or (B) a security interest in such fixtures may not be perfected by a UCC financing statement (or equivalent) in the jurisdiction of organization of the applicable Loan Party or the jurisdiction of location of such assets, as applicable, but for greater certainty excluding any fixtures in connection with a mortgage on real property that is not Excluded Property by operation of clause (a)(ii) above, (b) any lease, license, franchise, charter, authorization, contract or agreement to which any Loan Party is a party, and any of its rights or interest thereunder, if and to the extent that a security interest (i) is prohibited by or in violation of any law, rule or regulation applicable to any Loan Party, except to the extent such prohibition is rendered ineffective under the UCC (or equivalent applicable foreign law), or requires any governmental or third party consent or approval (provided, that such Loan Party has used commercially reasonable efforts (which for the avoidance of doubt shall not include any payment of non-de minimis amounts) to obtain such consent or approval) or (ii) is prohibited by or in violation of a term, provision or condition of any such lease, license, franchise, charter, authorization, contract or agreement; provided, however, that the Collateral shall include (and such security interest shall attach) at such time as the contractual or legal prohibition shall no longer be applicable (provided, that to the extent such prohibition requires any third party consent, such Loan Party has used commercially reasonable efforts (which for the avoidance of doubt shall not include any payment of non-de minimis amounts) to obtain such consent), shall attach to any portion of such lease, license, franchise, charter, authorization, contract or agreement not subject to the prohibitions specified in (i) or (ii) above (in each case, after giving effect to the applicable anti-assignment provisions of the UCC (or equivalent applicable foreign law); provided, further, that the exclusions referred to in this clause (b) shall not include any proceeds of any such lease, license, franchise, charter, authorization, contract or agreement, (c) motor vehicles and other assets subject to certificates of title, including, without limitation, aircraft, airframes, aircraft engines or helicopters, or any equipment or other assets constituting a part thereof, in each case to the extent subject to Federal Aviation Act registration requirements (or equivalent applicable foreign law), and rolling stock, (d) letters of credit and letter of credit rights that do not constitute supporting obligations in respect of other Collateral, except to the extent such letter of credit rights may be perfected by the filing of a UCC financing statement (or equivalent), (e) commercial tort claims with a value not in excess of $2,500,000 in the aggregate, (f) assets, if and to the extent that a security interest in such asset (i) is prohibited by or in violation of any law, rule or regulation applicable to any Loan Party, (ii) requires a consent (provided that any Loan Party has used its commercially reasonable efforts to obtain such consent) of any governmental authority or any third party that has not been obtained, except, in the case of clauses (f)(i) and (f)(ii), to the extent such prohibition or consent is rendered ineffective under the UCC (or equivalent applicable foreign law), or (iii) to the extent a security interest in such assets would result in a material adverse tax consequences (including as a result of the operation of Section 956 of the Code or any similar law or regulation in any applicable jurisdiction) as reasonably determined by the Lead Borrower, (g) (i) any “intent-to-use” application for registration of a trademark filed pursuant to Section 1(b) of the Lanham Act, 15 U.S.C. § 1051 (or comparable applicable foreign law), prior to the filing of a “Statement of Use” pursuant to Section 1(d) of the Lanham Act (or comparable applicable foreign law), to the extent that, and during the period, if any, in which, the grant of a security interest therein would impair the validity or enforceability of any registration that issues from such intent-to-use application under applicable federal law and (ii) any Intellectual Property located or titled outside the U.S. with respect to which any actions in any non-U.S. jurisdiction or under the 

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laws of any non-U.S. jurisdiction is required to create or perfect any security interest in such Intellectual Property, including any Intellectual Property registered in any non-U.S. jurisdiction, and (h) (x) in respect of the Collateral, Equity Interests in excess of 65% of the voting capital stock of any Foreign Subsidiary or CFC Holding Company owned by any Loan Party, (y) Equity Interests in joint ventures or any non-Wholly Owned Subsidiaries to the extent not permitted by the terms of such person’s organizational or joint venture documents existing on the Closing Date or existing at the time of acquisition thereof after the Closing Date, and (z) Equity Interests of Foreign Subsidiaries that are held by a Foreign Subsidiary; (i) perfection by “control” (other than in respect of certificated Collateral pledged pursuant to the Security Agreements or any accounts (other than Excluded Accounts)) with respect to any Collateral (j) FCC (or foreign equivalent) licenses to the extent the pledge thereof is prohibited by the Communications Act or any other Applicable Law (for the avoidance of doubt, this clause (j) does not extend to the proceeds of such FCC (or foreign equivalent) licenses; and (k) Excluded Accounts. Other assets shall be deemed to be “Excluded Property” if the Administrative Agent and the Lead Borrower agree in writing that the cost of obtaining or perfecting a security interest in such assets is excessive in relation to the value of such assets as Collateral. Notwithstanding anything herein to the contrary the foregoing provisions of this paragraph shall not exclude any rights and remedies incident or appertaining to any FCC (or foreign equivalent) licenses or any rights to receive any and all proceeds derived from, or in connection with, any disposition of all or any portion of such licenses or any television or cable film channel owned by a Borrower or any of its Restricted Subsidiaries.

 

Excluded Subsidiary” shall mean (a) any Subsidiary that is not a wholly owned Subsidiary of a Borrower or a Guarantor, (b) any Domestic Subsidiary that is a disregarded entity for United States federal income tax purposes substantially all of the assets of which consist of Equity Interests in one or more Foreign Subsidiaries that are CFCs, (c) any Domestic Subsidiary that is a direct or indirect Subsidiary of a Foreign Subsidiary that is a CFC, (d) any Subsidiary that is prohibited or restricted by Applicable Law, or by an contractual obligation existing on the of date of acquisition of such Subsidiary (if not entered into in contemplation thereof) from providing a Guaranty or if such Guaranty would require governmental (including regulatory) consent, approval, license or authorization (provided that the Loan Parties have used commercially reasonable efforts (which for the avoidance of doubt shall not include payment of non-de minimis amounts) to obtain such consent), (e) any Subsidiary that is a not-for-profit organization, (f) any other Subsidiary with respect to which, in the reasonable judgment of the Administrative Agent (confirmed in writing by notice to the Lead Borrower), the cost or other consequences (including any adverse tax consequences) of providing the Guaranty shall be excessive in view of the benefits to be obtained by the Lenders therefrom and (h) each Immaterial Subsidiary.

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 Guarantee of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act and the regulations thereunder at the time the Guaranty of such Guarantor or the grant of such 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 Guarantee or security interest is or becomes illegal

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 the Borrowers hereunder, (a) income, capital or franchise Taxes imposed on (or measured by) its net income imposed by a jurisdiction as a result of such recipient being organized under the laws of, or having its principal office located or, in the case of any Lender, having its applicable lending office located in, the jurisdiction imposing such Tax (b) any branch profits taxes or any similar tax imposed by a jurisdiction described in clause (a) above, (c) in the case of any Lender, U.S. federal withholding tax imposed on amounts payable to such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the applicable Commitment (or, to the extent such Lender did not fund an applicable Loan pursuant to a prior Commitment, on the date on which such Lender acquires its interest in such Loan); provided that this clause (i) shall not apply to a Lender that become a Lender pursuant to an assignment requested by the Lead Borrower under Section 2.21(a)), or (ii) such Lender changes its Lending Office, except in each case to the extent that, pursuant to Section 2.20, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender acquires the applicable

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interest in the applicable Loan or Commitment or to such Lender immediately before it changes its Lending Office, (d) any Tax that is attributable to such recipient’s failure to comply with Section 2.20(f) or (g), and (e) any U.S. federal withholding Taxes imposed under FATCA. For purposes of clause (c)(i) of this definition, a participation acquired pursuant to Section 2.18 shall be treated as having been acquired on the earlier date(s) on which the applicable Lender acquired the applicable interests in the Commitments or loans to which such participation relates.

 

Existing Indebtedness” shall mean the Indebtedness outstanding under (i) the Loan Agreement, dated as of March 31, 2011, by and among InterMedia Español, Inc. and Televicentro of Puerto Rico, LLC, as Borrowers, the financial institutions party thereto, as Lenders, The Bank of Nova Scotia and RBC Capital Markets, as Joint Lead Arrangers, Banco Popular de Puerto Rico, as Syndication Agent, and The Bank of Nova Scotia , as Administrative Agent (for the purposes of this definition, with all capitalized terms as defined therein) and, (ii) the Amended and Restated Credit Agreement, dated as of June 17, 2011, by and among Cine Latino, Inc., as the Borrower, the other persons party thereto that are designated as Credit Parties, General Electric Capital Corporation, as Agent, the other financial institutions party thereto, as Lenders, GE Capital Markets, Inc., as Sole Lead Arranger and Bookrunner and Royal Bank of Canada, as Syndication Agent (for the purposes of this definition, with all capitalized terms as defined therein).

Extended Term Loans” shall have the meaning assigned to such term in Section 2.25(a).

Extending Term Loan Lender” shall have the meaning assigned to such term in Section 2.25(a).

Extension” shall have the meaning assigned to such term in Section 2.25(a).

Extension Offer” shall have the meaning assigned to such term in Section 2.25(a).

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

FCC” shall mean the Federal Communications Commission (or any successor agency, commission, bureau, department or other political subdivision of the United States of America).

FCC Licenses” shall mean broadcasting and other licenses, authorizations, waivers and permits which are issued from time to time by the FCC to the Lead Borrower or any of its Restricted Subsidiaries in connection with the operation of the Stations.

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

Fee Letter” shall mean, as the context requires, (i) the Fee Letter dated July 9, 2013, among the Borrowers, DBSI and the Administrative Agent and/or (ii) the Fee Letter dated March 25, 2021, among the Borrowers and JPMCB.

Fees” shall mean the fees referred to in Section 2.05(a) and the Prepayment Fee.

Financial Covenant” shall have the meaning assigned to such term in Section 6.10(a).

Financial Covenant Event of Default” shall have the meaning assigned to such term in Section 7.01(d).

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Financial Officer” of any Person shall mean the chief financial officer, principal accounting officer, treasurer or controller of such Person.

 

First Lien Net Leverage Ratio” shall mean, on any date, the ratio of (a) an amount equal to the excess of (i) Total Debt that is secured on a first lien basis by a Lien on any asset of the Lead Borrower or any of its Restricted Subsidiaries on such date over (ii) the aggregate amount of unrestricted cash and Cash Equivalents (up to a maximum aggregate amount of $60,000,000) of the Lead Borrower and its Restricted Subsidiaries as of such date to (b) Consolidated EBITDA for the Test Period most recently ended on or prior to such date.

Fiscal Quarter” shall mean each calendar quarter.

Fiscal Year” shall mean the fiscal year of the Lead Borrower and its Restricted Subsidiaries ending on December 31.

Foreign Benefit Event” shall mean, with respect to any Foreign Pension Plan, (a) the existence of unfunded liabilities in excess of the amount permitted under any applicable law, or in excess of the amount that would be permitted absent a waiver from a Governmental Authority, (b) the failure to make the required contributions or payments, under any applicable law, on or before the due date for such contributions or payments, (c) the receipt of a notice by a Governmental Authority relating to the intention to terminate any such Foreign Pension Plan or to appoint a trustee or similar official to administer any such Foreign Pension Plan, or alleging the insolvency of any such Foreign Pension Plan, (d) the incurrence of any material liability by Holdings, the Borrowers or any of their respective Restricted Subsidiaries under applicable law on account of either (i) the complete or partial termination of such Foreign Pension Plan or (ii) the complete or partial withdrawal of any participating employer therein, or (e) the occurrence of any transaction that is prohibited under any applicable law and that could reasonably be expected to result in the incurrence of any material liability by Holdings, the Lead Borrower or any of its Restricted Subsidiaries (including by a Governmental Authority’s imposition on Holdings, the Lead Borrower or any of their respective Restricted Subsidiaries of any fine, excise tax or penalty resulting from any non-compliance with any applicable law.

Foreign Casualty Event” shall have the meaning assigned to such term in Section 2.13(e).

Foreign Disposition” shall have the meaning assigned to such term in Section 2.13(e).

Foreign Lender” shall mean any Lender that has a Commitment to or holds an Obligation of the Lead Borrower that is not a United States person within the meaning of Section 7701(a)(30) of the Code.

Foreign Pension Plan” shall mean any defined benefit pension plan that is not subject to United States law and under applicable law is required to be funded through a trust or other funding vehicle other than a trust or funding vehicle maintained exclusively by a Governmental Authority.

Foreign Subsidiary” shall mean any Subsidiary that is not a Domestic Subsidiary.

Funded Debt” of any Person shall mean Indebtedness for borrowed money of such Person that (x) by its terms matures more than one year after the date of its creation or (y) matures within one year from any date of determination but (in the case of this clause (y)) is renewable or extendible, at the option of such Person, to a date more than one year after such date or arises under a revolving credit or similar agreement that obligates the lender or lenders to extend credit during a period of more than one year after such date, including Indebtedness in respect of the Loans.

GAAP” shall mean generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or such other principles as may be approved by a significant segment of the accounting profession in the United States, that are applicable to the circumstances as of the date of determination, consistently applied.

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Governmental Authority” shall mean any federal, state, provincial territorial, local or foreign court or governmental agency, authority, instrumentality or regulatory body (including any supra-national bodies such as the European Union or the European Central Bank).

 

Granting Lender” shall have the meaning assigned to such term in Section 9.04(g).

Guarantee” of or by any Person shall mean any obligation, contingent or otherwise, of such Person guaranteeing or having the economic effect of guaranteeing any Indebtedness or other monetary obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of such Person, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other monetary obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment of such Indebtedness or other monetary obligation, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other monetary obligation of the payment of such Indebtedness or other monetary obligation or (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other monetary obligation; provided, however, that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.

Guarantor” shall mean any of Holdings, each Borrower and the Subsidiary Guarantors; provided that the term “Guarantor” shall mean and include each Borrower solely as it relates to any obligations that are incurred by any other Loan Party as opposed to obligations directly incurred by it.

Guaranty” shall mean the guaranty made by Holdings, each Borrower, and the Subsidiary Guarantors, substantially in the form of Exhibit E.

Hazardous Materials” shall mean (a) any petroleum products or byproducts and all other hydrocarbons, coal ash, radon gas, asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls, chlorofluorocarbons and all other ozone-depleting substances and (b) any chemical, material, substance or waste that is prohibited, limited or regulated by or pursuant to any Environmental Law.

Hedge Termination Value” shall mean, in respect of any one or more Secured Hedging Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedging Agreements, for any date on or after the date such Hedging Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s).

Hedging Agreement” shall mean any interest rate protection agreement, foreign currency exchange agreement, commodity price protection agreement or other interest or currency exchange rate or commodity price hedging arrangement, excluding spot foreign exchange transactions.

Hedging Bank” shall mean (i) any Person that is an Agent, a Lender, a Lead Arranger or an Affiliate of any of the foregoing on the Amendment No. 2 Effective Date or on the Amendment No. 3 Effective Date or at the time it enters into a Secured Hedging Agreement, in its capacity as a party thereto, whether or not such Person subsequently ceases to be an Agent, a Lender, a Lead Arranger or an Affiliate of any of the foregoing and (ii) any other Person, reasonably satisfactory to the Administrative Agent, that the Borrowers have designated in writing to the Administrative Agent as a “Hedging Bank” so long as, in the case of this clause (ii) (x) no Event of Default has occurred and is continuing at the time of such designation and (y) such Person executes an agreement in form reasonably satisfactory to the Administrative Agent agreeing to be bound to the terms of the Loan Documents applicable to a Hedging Bank.

Historical Financial Statements” shall mean:

(a)        audited consolidated statements of financial position, operations, shareholders’ equity and comprehensive income and cash flows of Cine Latino, Inc.as of and for the fiscal years ended December 31, 2012, December 31, 2011 and December 31, 2010 in each case with an accompanying opinion of McGladrey LLP, independent public accountants; and

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(b)        audited consolidated statements of financial position, operations, shareholders’ equity and comprehensive income and cash flows of InterMedia Español Holdings, LLC as of and for the fiscal years ended December 31, 2012, December 31, 2011 and December 31, 2010 in each case with an accompanying opinion of McGladrey LLP, independent public accountants.

 

Holdings” shall have the meaning assigned to such term in the introductory statement hereto.

Holdings Specified Expenses” shall mean any charge, tax or expense incurred or accrued by Holdings (or any parent company thereof) during any period to the extent that the Lead Borrower has made a Restricted Payment to Holdings (or any parent company thereof) in respect thereof pursuant to Sections 6.06(a)(ii) and 6.06(a)(iii), in each case, to the extent such change, tax or expense would have reduced Consolidated Net Income had it been made by the Lead Borrower.

Immaterial Account” shall mean any Deposit Account with an average monthly balance of less than $750,000, provided, that the average monthly balance of all Immaterial Accounts shall not exceed $5,000,000 at any time.

Immaterial Subsidiary” shall mean, as of any date of determination, any Restricted Subsidiary of the Lead Borrower whose consolidated total assets (as set forth in the most recent consolidated balance sheet of the Lead Borrower and its Restricted Subsidiaries delivered to the Lenders pursuant to this Agreement and computed in accordance with GAAP) do not constitute more than 2.5% of the amount set forth under the caption “Total Assets” (or any like caption) on a consolidated balance sheet of the Lead Borrower and its Restricted Subsidiaries as of the end of the most recently ended Fiscal Quarter for which internal financial statements are available; provided that the consolidated total assets (as so determined) of all Immaterial Subsidiaries shall not exceed 5.0% of the amount set forth under the caption “Total Assets” (or any like caption) on a consolidated balance sheet of the Lead Borrower and its Restricted Subsidiaries as of the end of the most recently ended Fiscal Quarter for which internal financial statements are available. For the avoidance of doubt, Azteca Acquisition Corporation shall be an Immaterial Subsidiary on the Closing Date.

Incremental Assumption Agreement” shall mean an Incremental Assumption Agreement among, and in form and substance reasonably satisfactory to, the Lead Borrower, the Administrative Agent and one or more Incremental Term Lenders.

Incremental Commitment Requirements” shall mean, with respect to the provision of any Incremental Term Loans or New Term Loans, the satisfaction of each of the following conditions on any such date: (i) no Default or Event of Default then exists or would result therefrom; provided that in connection with the provision of any Incremental Term Loans or New Term Loans the proceeds of which are to be applied to finance a Designated Acquisition the only Default or Event of Default required not to exist or result therefrom shall be Sections 7.01(b), (c), (g) or (h); (ii) all of the representations and warranties contained herein and in the other Loan Documents are true and correct in all material respects at such time (it being understood that (x) any representation and warranty that is qualified by materiality or Material Adverse Effect shall be required to be true and correct in all respects and (y) any representation and warranty which by its terms is made as of a specified date shall be required to be true and correct in all material respects (or all respects, as the case may be) as of such earlier date); provided that in connection with the provision of any Incremental Term Loans or New Term Loans the proceeds of which are to be applied to finance a Designated Acquisition only the Acquisition Representations need be true and correct in all material respects (as qualified in clause (x) and (y) above); (iii) the delivery by the Lead Borrower to the Administrative Agent on or prior to such date of an officer’s certificate executed by a Responsible Officer of the Lead Borrower and (x) certifying as to compliance with preceding clauses (i) and (ii) and, (y) designating as to whether the respective Incremental Term Loans or New Term Loans are to be incurred under clause (a) and/or clause (b), as applicable, of the definition of “Maximum Incremental Amount” and (z) certifying that the full amount of such Incremental Term Loans or New Term Loans (assuming the full utilization of commitments thereunder) may be incurred without violating any Material Indebtedness of Holdings, the Lead Borrower and its Restricted Subsidiaries; (iv) to the extent reasonably requested by the Administrative Agent, the delivery by the Lead Borrower to the Administrative Agent of an opinion or opinions, in form and substance reasonably satisfactory to the Administrative Agent, from counsel to the Loan Parties dated such date, covering such of the matters set forth in the opinions of counsel delivered to the Administrative Agent on the Closing Date pursuant to Section 4.02(a); and (v)

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the delivery by the Lead Borrower to the Administrative Agent of such officers’ certificates (including solvency certificates), board of director resolutions, reaffirmation agreements, supplements or amendments to the Security Documents (to the extent applicable) and evidence of good standing as the Administrative Agent shall reasonably request.

 

Incremental Facility” shall mean (i) each Incremental Term Loan and (ii) each New Term Loan.

Incremental Term Lender” shall have the meaning assigned to such term in Section 2.22(b).

Incremental Term Loan Assumption Agreement” shall mean an Incremental Term Loan Assumption Agreement among, and in form and substance reasonably satisfactory to, the Lead Borrower, the Administrative Agent and one or more Incremental Term Lenders; provided, that Amendment No. 3 shall be deemed to be an Incremental Term Loan Assumption Agreement with respect to the Add-on Term B-1 Loans.

Incremental Revolving Commitment” means a commitment to extend credit pursuant to any Incremental Revolving Facilities.

Incremental Revolving Facilities” shall have the meaning assigned to such term in Section 2.22(e).

Incremental Term Loan” shall have the meaning assigned to such term in Section 2.22(a).

Incremental Term Loan Commitment” shall mean, for any Lender, any commitment by such Lender to make Term Loans under any Incremental Term Loan Facility pursuant to Section 2.01(b) as agreed to by such Lender in the respective Incremental Assumption Agreement delivered pursuant to Section 2.22.

Indebtedness” of any Person shall mean, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property or assets purchased by such Person, (e) all obligations of such Person issued or assumed as the deferred purchase price of property or services (excluding (i) trade accounts payable and accrued obligations incurred in the ordinary course of business, (ii) any earn-out obligation until such obligation becomes a liability on the balance sheet of such Person in accordance with GAAP and, if not paid, after becoming due and payable, (iii) purchase price holdbacks in respect of a portion of the purchase price of an asset to satisfy warranty or other unperformed obligation of the applicable seller and (iv) any Indebtedness defeased by such Person or by any subsidiary of such Person), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the obligations secured thereby have been assumed, (g) all Guarantees by such Person of Indebtedness of others, (h) all Capital Lease Obligations of such Person, (i) all Synthetic Lease Obligations of such Person, (j) net obligations of such Person under any Hedging Agreements, valued at the Hedge Termination Value thereof, (k) all obligations of such Person in respect of Disqualified Stock of such Person or any other Person, (l) all obligations of such Person as an account party in respect of letters of credit and (m) all obligations of such Person in respect of bankers’ acceptances. The Indebtedness of any Person shall include the Indebtedness of any partnership in which such Person is a general partner, other than to the extent that the instrument or agreement evidencing such Indebtedness expressly limits the liability of such Person in respect thereof. The amount of Indebtedness of any Person for purposes of clause (f) shall be deemed to be equal to the lesser of (A) the aggregate unpaid amount of such Indebtedness and (B) the fair market value of the property encumbered thereby as determined by such Person in good faith.

Indemnified Taxes” shall mean Taxes other than Excluded Taxes and Other Taxes.

Indemnitee” shall have the meaning assigned to such term in Section 9.05(b).

Information” shall have the meaning assigned to such term in Section 9.16.

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Initial Term Loans” shall mean the Term Loans outstanding under this Agreement immediately prior to the effectiveness of Amendment No. 1.

 

Intellectual Property” shall have the meaning assigned to such term in the Security Agreement.

Intellectual Property Security Agreement” shall mean, collectively, each intellectual property security agreement (dated the date hereof) executed by the Loan Parties, substantially in the form of the exhibits to the Security Agreement, together with each other intellectual property security agreement or intellectual property security agreement supplement executed and delivered by a Loan Party pursuant to Section 5.13.

Intercreditor Agreements” shall mean, collectively, any Pari Passu Intercreditor Agreement (if entered into) and any Junior Lien Intercreditor Agreement (if entered into).

Interest Payment Date” shall mean (a) with respect to any ABR Loan, the last Business Day of each March, June, September and December, and (b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing of which such Term Loan is a part and, in the case of a Eurodollar Borrowing with an Interest Period of more than three months’ duration, each day that would have been an Interest Payment Date had successive Interest Periods of three months’ duration been applicable to such Borrowing.

Interest Period” shall mean (i) prior to the payoff of all Term B-1 Loans, with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day (or, if there is no numerically corresponding day, on the last day) in the calendar month that is 1, 2, 3, 6, or if available to all Lenders, 12 months or less than 1 month thereafter, as the Lead Borrower may elect, and (ii) upon and after the payoff of all Term B-1 Loans, with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is 1, 3 or 6 months thereafter, as the Lead Borrower may elect; provided, however, that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (b) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period and (c) no Interest Period for any Loan shall extend beyond the maturity date of such Loan. Interest shall accrue from and including the first day of an Interest Period to but excluding the last day of such Interest Period. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.

Interpolated Rate” shall mean the rate per annum determined by the Administrative Agent (which determination shall be conclusive and binding absent manifest error) to be equal to the rate that results from interpolating on a linear basis between: (a) the Reuters Screen LIBOR01 for the longest period for which the Reuters Screen LIBOR01 is available that is shorter than the Impacted Interest Period; and (b) the Reuters Screen LIBOR01 for the shortest period (for which the Reuters Screen LIBOR01 is available) that exceeds the Impacted Interest Period, in each case, at such time.

Investment” shall mean, as to any Person, any direct or indirect acquisition or investment by such Person, by means of (a) the purchase or other acquisition of Equity Interests or debt or other securities of another Person, (b) a loan, advance or capital contribution to, or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor incurs debt of the type referred to in clause (h) of the definition of Indebtedness in respect of such Person or (c) the purchase or other acquisition (in one transaction or a series of transactions) of all or substantially all of the property and assets or business of another Person or assets constituting a business unit, line of business or division of such Person. For purposes of covenant compliance, the amount of any Investment shall be the amount actually invested (measured at the time made), without adjustment for subsequent increases or decreases in the value of such Investment but giving effect to any returns or distributions of capital or repayment of principal actually received in cash by such Person with respect thereto (but only to the extent that the aggregate amount of all such returns, distributions and repayments with respect to such Investment does not

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exceed the principal amount of such Investment and less any such amounts which increase the Available Amount Basket) and “Invested” shall have a corresponding meaning.

 

IRS” shall mean the U.S. Internal Revenue Service or any successor agency thereto.

Issuing Bank” means each of JPMorgan Chase Bank, N.A., and Bank of America, N.A. and any other Revolving Lender that agrees to act as an Issuing Bank, each in its capacity as the issuer of Letters of Credit hereunder, and its successors in such capacity as provided in Section 10.06(i). Any Issuing Bank may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate. Each reference herein to the “Issuing Bank” in connection with a Letter of Credit or other matter shall be deemed to be a reference to the relevant Issuing Bank with respect thereto.

Junior Financing” shall mean, collectively any Permitted Unsecured Refinancing Debt, any Permitted Second Priority Refinancing Debt, any Permitted Ratio Debt, any New Incremental Notes (other than first lien New Incremental Notes), any other Indebtedness that is unsecured, any Subordinated Indebtedness or any Indebtedness incurred pursuant to one or more successive Permitted Refinancings of any of the foregoing; provided that Junior Financing shall not include any intercompany loans.

Junior Lien Intercreditor Agreement” shall mean a “junior lien” intercreditor agreement among the Administrative Agent and one or more representatives for the holders of Permitted Second Priority Refinancing Debt, in form and substance reasonably satisfactory to the Administrative Agent.

Latest Maturity Date” shall mean, at any date of determination, the latest maturity or expiration date applicable to any Loan or Commitment hereunder at such time, including the latest maturity or expiration date of any New Term Loan, any Other Term Loan or any Extended Term Loan, in each case as extended in accordance with this Agreement from time to time.

LC Disbursement” means a payment made by an Issuing Bank pursuant to a Letter of Credit.

LC Exposure” means, at any time, the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time, plus (b) the aggregate amount of all LC Disbursements that have not yet been reimbursed by or on behalf of the Borrowers at such time. The LC Exposure of any Lender at any time shall be its Applicable Percentage of the LC Exposure at such time. For all purposes of this Agreement, if on any date of determination a Letter of Credit has expired by its terms but any amount may still be drawn thereunder by reason of the operation of Article 29(a) of the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce Publication No. 600 (or such later version thereof as may be in effect at the applicable time) or Rule 3.13 or Rule 3.14 of the International Standby Practices, International Chamber of Commerce Publication No. 590 (or such later version thereof as may be in effect at the applicable time) or similar terms of the Letter of Credit itself, or if compliant documents have been presented but not yet honored, such Letter of Credit shall be deemed to be “outstanding” and “undrawn” in the amount so remaining available to be paid, and the obligations of the Borrowers and each Lender shall remain in full force and effect until the Issuing Bank and the Lenders shall have no further obligations to make any payments or disbursements under any circumstances with respect to any Letter of Credit.

Lead Arrangers” means the Amendment No. 2 Lead Arrangers and the Amendment No. 3 Lead Arrangers.

Lead Borrower” shall have the meaning assigned to such term in the introductory statement hereto.

Lender Parent” means, with respect to any Lender, any Person as to which such Lender is, directly or indirectly, a subsidiary.

Lender Parties” shall have the meaning assigned to such term in Section 7.02(c).

Lenders” shall mean the Term Lenders and the Revolving Lenders. Unless the context otherwise requires, the term “Lenders” includes the Issuing Banks (including, without limitation, for purposes of Section 2.14).

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Letter of Credit” means any letter of credit issued pursuant to this Agreement.

 

Letter of Credit Agreement” has the meaning assigned to it in Section 10.06(b).

Letter of Credit Commitment” means, with respect to each Issuing Bank, the commitment of such Issuing Bank to issue Letters of Credit hereunder. The initial amount of each Issuing Bank’s Letter of Credit Commitment is set forth on Schedule 10.01, or if an Issuing Bank has entered into an Assignment and Assumption or has otherwise assumed a Letter of Credit Commitment after the Amendment No. 3 Effective Date, the amount set forth for such Issuing Bank as its Letter of Credit Commitment in the Register maintained by the Administrative Agent. The Letter of Credit Commitment of an Issuing Bank may be modified from time to time by agreement between such Issuing Bank and the Borrowers, and notified to the Administrative Agent. As of the Amendment No. 3 Effective Date, the initial aggregate amount of the Letter of Credit Commitments is $10,000,000.

LIBO Rate” shall mean, with respect to any Eurodollar Borrowing for any Interest Period, the London interbank offered rate as administered by the ICE Benchmark Administration (or any other Person that takes over the administration of such rate) for Dollars for a period equal in length to such Interest Period as displayed on the Reuters Screen LIBOR01 (or such other page as may replace such page on such service for the purpose of displaying the rates at which dollar deposits are offered by leading banks in the London interbank deposit market) at approximately 11:00 a.m., London, England time, on the second full Business Day preceding the first day of such Interest Period; provided that if the Reuters Screen LIBOR01 shall not be available for such Interest Period (an “Impacted Interest Period”) then the LIBO Rate shall be the Interpolated Rate (as defined above).

Notwithstanding the foregoing, the LIBO Rate in respect of any applicable Interest Period will be deemed to be 0.00% per annum if the LIBO Rate for such Interest Period calculated pursuant to the foregoing provisions would otherwise be less than 0.00% per annum.

Lien” shall mean, with respect to any asset, (a) any Mortgage, hypothec, deed of trust, lien, pledge, encumbrance, charge or security interest in or on such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

Loan Documents” shall mean this Agreement, the Fee Letter, the Guaranty, the Security Documents, each Incremental Term Loan Assumption Agreement, each New Term Loan Commitment Agreement, each Incremental Revolving Facility Amendment, each Refinancing Amendment, the promissory notes, if any, executed and delivered pursuant to Section 2.04(e) and/or Section 10.10(e) and any agreements between a Borrower and an Issuing Bank regarding the issuance by such Issuing Bank of Letters of Credit hereunder and/or the respective rights and obligations between such Borrower and such Issuing Bank in connection thereunder, and any other document executed in connection with the foregoing, including any guaranty or guaranty supplement required to be delivered pursuant to Section 5.13.

Loan Parties” shall mean Holdings, the Borrowers and the Subsidiary Guarantors.

Loans” shall mean the collective reference to the Term Loans and the Revolving Loans.

London Banking Day” shall mean any day on which dealings in Dollar deposits are conducted by and between banks in the London interbank market.

Margin Stock” shall have the meaning assigned to such term in Regulation U.

Material Adverse Effect” shall mean (a) a material adverse change in, or a material adverse effect on, the operations, business, assets, properties, liabilities (actual or contingent) or financial condition of Holdings, the Lead Borrower and its Restricted Subsidiaries taken as a whole; (b) a material adverse effect on the ability of any Loan Party to perform its material obligations under any of the Loan Documents to which it is a party; or (c) a material

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adverse effect upon the legality, validity, binding effect or the enforceability against any Loan Party of any of the Loan Documents to which it is a party.

 

Material Domestic Subsidiary” shall mean, as of the Closing Date and thereafter at any date of determination, each of the Borrower’s Domestic Subsidiaries, other than an Immaterial Subsidiary.

Material Indebtedness” shall mean Indebtedness (other than the Loans), or obligations in respect of one or more Hedging Agreements, of any one or more of Holdings, the Borrowers or any of their respective Restricted Subsidiaries in an aggregate principal amount exceeding $10,000,000. For purposes of determining Material Indebtedness, the “principal amount” of the obligations of Holdings, the Borrowers or any of their respective Restricted Subsidiaries in respect of any Hedging Agreement at any time shall be the Hedge Termination Value of such Hedging Agreement at such time.

Material Lease” shall have the meaning assigned to such term in Section 3.20(b).

Material Owned Real Property” shall have the meaning assigned to such term in Section 3.20(a).

Maturity Date” shall mean, with respect to the Term B-1 Loans, the Term B-1 Loan Maturity Date; provided that the reference to Maturity Date with respect to (w) Other Term Loans shall be the final maturity date as specified in the applicable Refinancing Amendment, (x) Extended Term Loans shall be the final maturity date as specified in the applicable Extension Offer, (y) Incremental Term Loans shall be the final maturity date as specified in the applicable Incremental Term Loan Assumption Agreement and (z) any New Term Loans shall be the final maturity date as specified in the applicable New Term Loan Commitment Agreement; provided further that if any such day is not a Business Day, the applicable Maturity Date shall be the Business Day immediately succeeding such day.

Maximum First Lien Net Leverage Requirement” shall mean, with respect to any request pursuant to Article II for an Incremental Facility or an incurrence of New Incremental Notes, the requirement that, the First Lien Net Leverage Ratio shall be less than or equal to 4.00:1.00, determined on a Pro Forma Basis after giving effect to such increase, New Term Loans or New Incremental Notes and assuming that in each case such Incremental Facility is fully drawn, as of the last day of the Test Period most recently ended for which financial statements have been delivered pursuant to Section 5.04(a) or 5.04(b); provided that when calculating the First Lien Net Leverage Ratio for purposes of this definition, (x) all Indebtedness incurred pursuant to Sections 2.22, 2.23 and 2.24 and any refinancing thereof (pursuant to Section 2.26, any Credit Agreement Refinancing Indebtedness, any Permitted Refinancing of any other refinancings and successive refinancings thereof) (in each case, whether or not such Indebtedness is unsecured) shall be deemed to constitute Total Debt that is secured by a first ranking Lien on the assets of the Lead Borrower or any of its Restricted Subsidiaries, and (y) the cash proceeds of any such Incremental Facility or New Incremental Notes shall not be included in the amount of unrestricted cash and Cash Equivalents to be netted in calculating such ratio.

Maximum Incremental Amount” shall mean, at any time of determination, the sum of (a) the excess of (i) $65,000,000 over (ii) the aggregate principal amount of Incremental Term Loans made pursuant to Section 2.22, New Term Loans made pursuant to Section 2.23 and New Incremental Notes issued or incurred pursuant to Section 2.24, in each case, prior to such time in reliance on clause (a)(i) plus (b) an additional amount if, after giving effect to the incurrence of such additional amount, the Maximum First Lien Net Leverage Requirement and the Maximum Total Net Leverage Requirement have been satisfied. For the avoidance of doubt, the Add-on Term B-1 Loans shall constitute Incremental Term Loans incurred in reliance on clause (b) of the previous sentence, with any amounts not in compliance therewith, if any, deemed incurred under clause (a) of the previous sentence.

Maximum Rate” shall have the meaning assigned to such term in Section 9.09.

Maximum Total Net Leverage Requirement” shall mean, with respect to any request pursuant to Article II for an Incremental Facility or an incurrence of New Incremental Notes, the requirement that, the Total Net Leverage Ratio shall be less than or equal to 6.00:1.00, determined on a Pro Forma Basis after giving effect to such Incremental Facility or New Incremental Notes and assuming that in each case such Incremental Facility is fully

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drawn as of the last day of the Test Period most recently ended for which financial statements have been delivered pursuant to Section 5.04(a) or 5.04(b); provided that when calculating the Total Net Leverage Ratio for purposes of this definition, the cash proceeds of any such Incremental Facility or New Incremental Notes shall not be included in the amount of unrestricted cash and Cash Equivalents to be netted in calculating such ratio.

 

Minimum Extension Condition” shall have the meaning assigned thereto in Section 2.25(b).

Minority Investment” shall mean any Person other than a Subsidiary in which the Lead Borrower or any of its Restricted Subsidiaries owns any Equity Interests.

Moody’s” shall mean Moody’s Investors Service, Inc., or any successor thereto.

Mortgaged Properties” shall have the meaning specified in paragraph (e) of the definition of “Collateral and Guarantee Requirement.”

Mortgages” shall mean the mortgages, deeds of trust, hypothecs, debentures, assignments of leases and rents, modifications and other security documents delivered pursuant to Sections 5.13 or 5.16.

Multiemployer Plan” shall mean a multiemployer plan as defined in Section 4001(a)(3) of ERISA to which the Lead Borrower or any ERISA Affiliate currently makes or is obligated to make contributions or to which the Lead Borrower or any ERISA Affiliate has made or was obligated, within the preceding five years, to make contributions.

Net Cash Proceeds” shall mean (a) with respect to any Asset Sale, the cash proceeds thereof (including (x) cash proceeds subsequently received (as and when received) in respect of non-cash consideration initially received, (y) in the case of a casualty, insurance proceeds and (z) in the case of a condemnation or similar event, condemnation awards and similar payments), net of (i) selling expenses (including reasonable broker’s fees or commissions, legal fees, transfer and similar taxes and the Lead Borrower’s good faith estimate of income taxes paid or payable in connection with such sale), (ii) amounts provided as a reserve, in accordance with GAAP, against any liabilities under any indemnification obligations or purchase price adjustment associated with such Asset Sale (provided that, to the extent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds) and (iii) the principal amount, premium or penalty, if any, interest and other amounts on any Indebtedness for borrowed money which is secured by the asset sold in such Asset Sale and which is required to be repaid with such proceeds (other than (x) any such Indebtedness assumed by the purchaser of such asset, (y) Indebtedness under the Loan Documents and (z) any Indebtedness secured by the Collateral on a pari passu or junior basis); provided, however, that, if (A) the Lead Borrower shall deliver a certificate of a Financial Officer to the Administrative Agent at the time of receipt thereof setting forth the Lead Borrower’s intent to reinvest such proceeds in productive assets of a kind then used or usable in the business of the Lead Borrower or its Restricted Subsidiaries within the time period specified in this definition and (B) no Default or Event of Default shall have occurred and shall be continuing at the time of such certificate or at the proposed time of the application of such proceeds, such proceeds shall not constitute Net Cash Proceeds except to the extent not so used (1) within 365 days following the receipt of such proceeds, at which time such proceeds shall be deemed to be Net Cash Proceeds or (2) if the Lead Borrower or the relevant Restricted Subsidiary enters into a legally binding commitment to reinvest such Net Cash Proceeds within 365 days following the receipt thereof, such 365 days period will be extended with respect to the amount of Net Cash Proceeds so committed until such Net Cash Proceeds are required to be applied in accordance with such agreement (but such extension will in no event be for a period longer than 180 days); (b) with respect to any issuance or incurrence of Indebtedness, the cash proceeds thereof, net of all taxes and customary fees, commissions, costs and other expenses incurred in connection therewith; and (c) with respect to any Permitted Equity Issuance by any direct or indirect parent of the Lead Borrower, the amount of cash from such Permitted Equity Issuance contributed to the capital of the Lead Borrower.

Net Working Capital” shall mean, with respect to the Lead Borrower and its Restricted Subsidiaries on a consolidated basis, Consolidated Current Assets minus Consolidated Current Liabilities.

New Incremental Notes” shall have the meaning assigned thereto in Section 2.24(a).

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New Term Loan” shall have the meaning assigned thereto in Section 2.23(a).

 

New Term Loan Borrowing Date” shall mean, with respect to each Class of New Term Loans, each date on which New Term Loans of such Class are incurred pursuant to Section 2.01(c) and as otherwise permitted pursuant to Section 2.23.

New Term Loan Commitment” shall mean, for each Lender, any commitment to make New Term Loans provided by such Lender pursuant to Section 2.23, in such amount as agreed to by such Lender in the respective New Term Loan Commitment Agreement.

New Term Loan Commitment Agreement” shall mean a New Term Loan Commitment Agreement among the Borrowers, the Administrative Agent and one or more New Term Loan Lenders on the same terms as this Agreement provided that (a) the Effective Yield in respect of such New Term Loans may be different from the then current Effective Yield in respect of the Term B-1 Loans, (b) the Maturity Date of such New Term Loans may be later than (but not earlier) than the Latest Maturity Date, (c) such New Term Loans may not have a shorter Weighted Average Life to Maturity the then outstanding Term B-1 Loans, (d) such New Term Loan Lenders may agree less favorable treatment with respect to mandatory prepayment provisions than those under the Term B-1 Loans and (e) any other departures from the terms of this Agreement shall be reasonably satisfactory to the Administrative Agent.

New Term Loan Facility” shall mean any term loan facility established pursuant to Section 2.23.

New Term Loan Lender” shall have the meaning assigned thereto in Section 2.23(p).

NYFRB” means the Federal Reserve Bank of New York.

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

Obligations” shall mean all obligations of any of the Loan Parties from time to time arising under or in respect of the due and punctual payment of (i) the principal of and premium, if any, and interest (including any post-petition interest (as defined in the Security Agreement) on the Loans, any Letters of Credit and any other loans outstanding under this Agreement, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) all other monetary obligations, including Letter of Credit commissions, fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any proceeding under any Debtor Relief Laws naming such Loan Party as the debtor in such proceeding, regardless of whether allowed or allowable in such proceeding), of the Loan Parties under the Loan Documents, (iii) obligations of any Loan Party arising under any Secured Hedging Agreement (excluding any Excluded Swap Obligations) and (iv) Cash Management Obligations.

Officer’s Certificate” shall mean a certificate of the chief financial officer or the treasurer of the Lead Borrower substantially in the form attached as Exhibit H or such other form as shall be approved by the Administrative Agent.

Other Applicable Indebtedness” shall have the meaning assigned to such term in Section 2.13(a).

Other Taxes” shall mean any and all present or future stamp or documentary taxes or any other excise or property taxes, charges or similar levies arising from any payment made under any Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, any Loan Document.

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Other Term Loan Borrowing Date” shall mean, with respect to each Class of Other Term Loans, each date on which Other Term Loans of such Class are incurred pursuant to Section 2.01(d) and as otherwise permitted pursuant to Section 2.26.

 

Other Term Loan Commitments” shall mean one or more Classes of Term Loan Commitments hereunder that result from a Refinancing Amendment.

Other Term Loans” shall mean one or more Classes of Term Loans that result from a Refinancing Amendment.

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

Parent” shall mean Hemisphere Media Group, Inc.

Pari Passu Intercreditor Agreement” shall mean a “pari passu” intercreditor agreement among the Administrative Agent and one or more representatives for the holders of Permitted First Priority Refinancing Debt or New Incremental Notes, in form and substance reasonably satisfactory to the Administrative Agent.

Participant Register” shall have the meaning assigned to such term in Section 9.04(c).

Payment” shall have the meaning assigned to such term in Article VII.

Payment Notice” shall have the meaning assigned to such term in Article VII.

Payment Office” shall mean the office of the Administrative Agent located at 10 South Dearborn, Floor 07, Chicago, IL, 60603-2300 or such other office as the Administrative Agent may hereafter designate in writing as such to the other parties hereto.

PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and defined in ERISA.

Perfection Certificate” shall mean the perfection certificate substantially in the form of Exhibit II to the Security Agreement.

Permitted Acquisition” shall have the meaning assigned to such term in Section 6.04(f).

Permitted Encumbrance” shall mean, with respect to any Mortgaged Property located in the United States, such exceptions to title as are set forth in any Mortgage Policy delivered with respect thereto, all of which exceptions must be acceptable to the Administrative Agent in its reasonable discretion or, with respect to any Mortgaged Property located in any jurisdiction other than then United States, the equivalent exceptions (if any) that apply under any Applicable Law.

Permitted Equity Issuance” shall mean any sale or issuance of any Qualified Capital Stock of the Lead Borrower or any direct or indirect parent of the Lead Borrower, in each case to the extent permitted hereunder.

Permitted First Priority Refinancing Debt” shall mean any secured Indebtedness incurred by the Lead Borrower in the form of one or more series of senior secured notes or loans; provided that (a) such Indebtedness is secured by the Collateral on a pari passu basis (but without regard to the control of remedies) with the Obligations and is not secured by any property or assets of the Lead Borrower or any of its Restricted Subsidiaries other than the Collateral, (b) such Indebtedness constitutes Credit Agreement Refinancing Indebtedness, (c) such Indebtedness is not at any time guaranteed by any Subsidiaries other than Subsidiaries that are Guarantors, (d) the holders of such Indebtedness (or their representative) and the Administrative Agent shall be party to a Pari Passu Intercreditor

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Agreement, and (e) such Indebtedness has covenants and default and remedy provisions that in the good faith determination of the Lead Borrower are no more restrictive taken as a whole, than those set forth in this Agreement.

 

Permitted Investors” shall mean:

(a)        InterMedia Partners VII, L.P., a Delaware limited partnership and Searchlight II HMT, L.P., a Delaware limited partnership;

(b)        any Affiliate or Related Party of any Person specified in clause (a), other than another portfolio company thereof (which means a company actively engaged in providing goods and services to unaffiliated customers) or a company controlled by a “portfolio company”; and

(c)        any Person both the Equity Interests of such Person and the aggregate ordinary voting power represented by the issued and outstanding Equity Interests of such Person of which (or in the case of a trust, the beneficial interests in which) are owned 50% or more by Persons specified in clauses (a) and (b).

Permitted Junior Debt Conditions” shall mean that such applicable debt (a) is not scheduled to mature prior to the date that is 180 days after the then Latest Maturity Date, (b) does not mature or have scheduled amortization payments of principal or payments of principal and is not subject to mandatory redemption, repurchase, prepayment or sinking fund obligations (except customary asset sale or change of control provisions that provide for the prior repayment in full of Loan and all other Obligations), in each case prior to the Latest Maturity Date at the time such Indebtedness is incurred, (c) such Indebtedness is not at any time guaranteed by any Restricted Subsidiaries other than Restricted Subsidiaries that are Guarantors and (d) has covenants and default and remedy provisions that are no more restrictive taken as a whole, than those set forth in this Agreement; provided that a certificate of a Responsible Officer of the Lead Borrower delivered to the Administrative Agent in good faith at least five (5) Business Days prior to the incurrence of such Indebtedness, together with a reasonably detailed description of the material terms and conditions of such Indebtedness or drafts of the documentation relating thereto, stating that the Lead Borrower has determined in good faith that such terms and conditions satisfy the requirement set out in the foregoing clause (d), shall be conclusive evidence that such terms and conditions satisfy such requirement unless the Administrative Agent provides notice to the Lead Borrower of an objection during such five (5) Business Day period (including a reasonable description of the basis upon which it objects).

Permitted Ratio Debt” shall mean Indebtedness of the Lead Borrower or any of its Restricted Subsidiaries; provided that (a) such Indebtedness is either (x) senior unsecured Indebtedness ranking pari passu in right of payment to the Obligations or (y) subordinated in right of payment to the Obligations, (b) such Indebtedness does not mature prior to the date that is 91 days after the Latest Maturity Date at the time such Indebtedness is incurred, (c) such Indebtedness has no scheduled amortization or scheduled payments of principal and is not subject to mandatory redemption, repurchase, prepayment or sinking fund obligation (other than customary offers to repurchase upon a change of control, asset sale or casualty event and customary acceleration rights after an event of default) prior to the date that is 91 days after the Latest Maturity Date at the time such Indebtedness is incurred, (d) no Default or Event of Default shall then exist or result therefrom, (e) immediately after giving effect thereto and to the use of the proceeds thereof, the Lead Borrower shall be in Pro Forma Compliance with a Total Net Leverage Ratio of 6.00:1.00 as of the most recently ended Test Period for which financial statements have been delivered pursuant to Sections 5.04(a) and 5.04(b), (f) the covenants, events of default, guarantees and other terms of such Indebtedness are customary for similar Indebtedness in light of then-prevailing market conditions and in any event, when taken as a whole (other than interest rate and redemption premiums), are not more restrictive to the Lead Borrower and its Restricted Subsidiaries than those set forth in this Agreement (provided that a certificate of a Responsible Officer of the Lead Borrower delivered to the Administrative Agent in good faith at least five (5) Business Days prior to the incurrence of such Indebtedness, together with a reasonably detailed description of the material terms and conditions of such Indebtedness or drafts of the documentation relating thereto, stating that the Lead Borrower has determined in good faith that such terms and conditions satisfy the requirement set out in the foregoing clause (f), shall be conclusive evidence that such terms and conditions satisfy such requirement unless the Administrative Agent provides notice to the Lead Borrower of an objection during such five (5) Business Day period (including a reasonable description of the basis upon which it objects)), (g) in respect of which no Restricted Subsidiary of the Lead Borrower that is not a Guarantor under the Loan Documents is an obligor, (h) if such

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Indebtedness is subordinated, (x) the subordination provisions shall be reasonably satisfactory to the Administrative Agent and (y) the Term Loan Facilities shall have been, and while the Term Loan Facilities remain outstanding no other Indebtedness is or is permitted to be, designated as “designated senior debt” or its equivalent in respect of such Indebtedness and (i) the Lead Borrower shall have delivered to the Administrative Agent an officer’s certificate executed by a Responsible Officer of the Lead Borrower certifying to such officer’s knowledge, compliance with the requirements of this definition, including reasonably detailed calculations required to demonstrate compliance with the Total Net Leverage Ratio required by clause (e) above.

 

Permitted Refinancing” shall mean, with respect to any Person, any modification, refinancing, refunding, renewal, replacement, exchange or extension of any Indebtedness of such Person; provided that (a) the principal amount (or accreted value, if applicable) thereof does not exceed the principal amount (or accreted value, if applicable) of the Indebtedness so modified, refinanced, refunded, renewed, replaced, exchanged or extended except by an amount equal to accrued and unpaid interest and a reasonable premium thereon plus other reasonable amounts paid, and fees and expenses reasonably incurred (including original issue discount and upfront fees), in connection with such modification, refinancing, refunding, renewal, replacement, exchange or extension and by an amount equal to any existing commitments unutilized thereunder; (b) such modification, refinancing, refunding, renewal, replacement, exchange or extension has a final maturity date equal to or later than the final maturity date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the Indebtedness being modified, refinanced, refunded, renewed, replaced, exchanged or extended; (c) if the Indebtedness being modified, refinanced, refunded, renewed, replaced, exchanged or extended is subordinated in right of payment to the Obligations, such modification, refinancing, refunding, renewal, replacement, exchange or extension is subordinated in right of payment to the Obligations on terms, taken as a whole, as favorable in all material respects to the Lenders (including, if applicable, as to Collateral) as those contained in the documentation governing the Indebtedness being modified, refinanced, refunded, renewed, replaced, exchanged or extended; (d) if the Indebtedness being modified, refinanced, refunded, renewed, replaced, exchanged or extended is (i) unsecured, such modification, refinancing, refunding, renewal, replacement, exchange or extension is unsecured or (ii) secured by Liens, such modification, refinancing, refunding, replacement, renewal or extension is either (x) unsecured or is not secured by any Liens that do not also secure the Obligations or (y) if secured by Liens that also secure the Obligations, to the extent that such Liens are subordinated to, or (but only if, and to the extent, the Indebtedness being modified, refinanced, refunded, renewed or extended was secured equally and ratably with the Obligations) secured equally and ratably with, Liens securing the Obligations and/or such security interests were subject to (or required at the time such Indebtedness was originally incurred to be subject to) any intercreditor arrangements (including, if applicable, an Intercreditor Agreement) for the benefit of the Lenders, such modification, refinancing, refunding, replacement, renewal or extension is secured and subject to intercreditor arrangements on terms, taken as a whole, as favorable in all material respects to the Lenders (including as to Collateral) as those contained in the documentation (including any intercreditor or similar agreements) governing the Indebtedness being modified, refinanced, replaced, refunded, replaced, renewed or extended or otherwise on terms reasonably satisfactory to the Administrative Agent; (e) the terms and conditions (including, if applicable, as to collateral) of any such modified, refinanced, refunded, renewed, replaced, exchanged or extended Indebtedness are, (A) either (i) customary for similar debt securities in light of then-prevailing market conditions (it being understood that such Indebtedness shall not include any financial maintenance covenants) or (ii) not materially less favorable to the Loan Parties or the Lenders, taken as a whole, than the terms and conditions of the Indebtedness being modified, refinanced, refunded, renewed, replaced, exchanged or extended, and (B) when taken as a whole (other than interest rate and redemption premiums), not more restrictive to the Lead Borrower and its Restricted Subsidiaries than those set forth in this Agreement (provided that a certificate of a Responsible Officer of the Lead Borrower delivered to the Administrative Agent in good faith at least five Business Days prior to the incurrence of such Indebtedness, together with a reasonably detailed description of the material terms and conditions of such Indebtedness or drafts of the documentation relating thereto, stating that the Lead Borrower has determined in good faith that such terms and conditions satisfy the requirement set out in this clause (e), shall be conclusive evidence that such terms and conditions satisfy such requirement unless the Administrative Agent provides notice to the Lead Borrower of its objection during such five Business Day period (including a reasonable description of the basis upon which it objects); (f) such modification, refinancing, refunding, renewal, replacement, exchange or extension does not add guarantors or other obligors from that which applied to the Indebtedness being modified, refinanced, refunded, renewed, replaced or extended (unless such guarantors or obligors are also added to support the Obligations); and (g) at the time thereof, no Event of Default shall have occurred and be continuing.

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Permitted Second Priority Refinancing Debt” shall mean secured Indebtedness incurred by the Lead Borrower in the form of one or more series of second lien secured notes or second lien secured loans; provided that (a) such Indebtedness is secured by the Collateral on a second priority basis to the Liens securing the Obligations and the obligations in respect of any Permitted First Priority Refinancing Debt and is not secured by any property or assets of the Lead Borrower or any of its Restricted Subsidiaries other than the Collateral, (b) such Indebtedness constitutes Credit Agreement Refinancing Indebtedness (provided, that such Indebtedness may be secured by a Lien on the Collateral that is junior to the Liens securing the Obligations and the obligations in respect of any Permitted First Priority Refinancing Debt, notwithstanding any provision to the contrary contained in the definition of “Credit Agreement Refinancing Indebtedness”), (c) the holders of such Indebtedness (or their representative) and the Administrative Agent shall be party to a Junior Lien Intercreditor Agreement, and (d) such Indebtedness meets the Permitted Junior Debt Conditions.

 

Permitted Unsecured Refinancing Debt” shall mean unsecured Indebtedness incurred by the Lead Borrower in the form of one or more series of senior unsecured notes or loans; provided that (i) such Indebtedness constitutes Credit Agreement Refinancing Indebtedness and (ii) meets the Permitted Junior Debt Conditions.

Person” shall mean any natural person, corporation, business trust, joint venture, association, company, limited liability company, partnership, Governmental Authority or other entity.

Plan” shall mean any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA, and in respect of which the Borrowers or any ERISA Affiliate is (or, if such plan were terminated, would under Section 4069 of ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

Platform” shall have the meaning assigned to such term in Section 5.04.

PR Mortgage” shall mean that certain Deed of Mortgage Number 6, executed before Notary Public Luis Morales-Steinmann on March 30, 2007 by Televicentro of Puerto Rico, LLC, as the mortgagor, as amended by that certain Deed of Amendment of Mortgage Number 6, executed before Notary Public Gladys O. Fontanez Reyes on June 28, 2011 by and between Televicentro of Puerto Rico, LLC, as the mortgagor, and The Bank of Nova Scotia, as then holder of the PR Mortgage Note. The PR Mortgage shall constitute a Mortgage pursuant to the terms of this Agreement.

PR Mortgage Note” shall mean that certain $10,000,000 mortgage note issued by Televicentro of Puerto Rico, LLC on March 30, 2007 and secured by the PR Mortgage.

PR Mortgage Note Pledge and Security Agreement” shall mean a mortgage note pledge and security agreement executed on the date hereof and through which Televicentro of Puerto Rico, LLC pledges the PR Mortgage Note to the Collateral Agent as collateral guaranteeing the Loans.

Prepayment Amount” shall have the meaning assigned to such term in Section 2.13(f).

Prepayment Date” shall have the meaning assigned to such term in Section 2.13(f).

Prepayment Fee” shall have the meaning assigned to such term in Section 2.05(b).

Prime Rate” shall mean (i) prior to the payoff of all Term B-1 Loans, the rate of interest per annum determined from time to time by the Administrative Agent as its prime rate in effect at its principal office in New York City and notified to the Borrowers, and (ii) upon and after the payoff of all Term B-1 Loans, the rate of interest last quoted by The Wall Street Journal as the “Prime Rate” in the U.S. or, if The Wall Street Journal ceases to quote such rate, the highest per annum interest rate published by the Federal Reserve Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest Rates) as the “bank prime loan” rate or, if such rate is no longer quoted therein, any similar rate quoted therein (as determined by the Administrative Agent) or any similar release by the Federal Reserve Board (as determined by the Administrative Agent), and, with respect to clause (ii), each change in the Prime Rate shall be effective from and including the date such change is publicly announced or quoted as being

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effective. The prime rate is a rate set by the Administrative Agent based upon various factors including the Administrative Agent’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such rate.

 

Pro Forma Basis” shall mean, with respect to compliance with any test, covenant or calculation of any ratio hereunder, the determination or calculations of such test, covenant or ratio (including in connection with Specified Transaction) in accordance with Section 1.04.

Pro Forma Compliance” shall mean, with respect to any test, covenant or calculation of any ratio hereunder, compliance on a Pro Forma Basis in accordance with Section 1.04.

Public Lender” shall have the meaning assigned to such term in Section 9.01.

Qualified Capital Stock” of any Person shall mean any Equity Interest of such Person that is not Disqualified Stock.

Qualified ECP Guarantor” shall mean, in respect of any Swap Obligation, each Loan Party that has total assets exceeding $10,000,000 at the time the relevant Guaranty or grant of the relevant security interest becomes effective with respect to such Swap Obligation or such other person as constitutes an “eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another person to qualify as an “eligible contract participant” at such time by entering into a keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

Qualified Holding Company Indebtedness” shall mean unsecured Indebtedness of Holdings (A) that is not subject to any Guarantee by any Subsidiary of Holdings, (B) that will not mature prior to the date that is 91 days after the Latest Maturity Date of any Term Loan Facility in effect on the date of issuance or incurrence thereof, (C) that has no scheduled amortization or scheduled payments of principal and is not subject to mandatory redemption, repurchase, prepayment or sinking fund obligation (it being understood that such Indebtedness may have mandatory prepayment, repurchase or redemption provisions satisfying the requirements of clause (E) below), (D) that does not require any payments in cash of interest or other amounts in respect of the principal thereof prior to the earlier to occur of (1) the date that is four (4) years from the date of the issuance or incurrence thereof and (2) the date that is 91 days after the Latest Maturity Date of any Term Loan Facility in effect on the date of such issuance or incurrence, and (E) that has mandatory prepayment, repurchase or redemption, covenant, default and remedy provisions customary for senior discount notes of an issuer that is the parent of a borrower under senior secured credit facilities, and in any event, with respect to covenant, default and remedy provisions, no more restrictive (taken as a whole) than those set forth in this Agreement (other than provisions customary for senior discount notes of a holding company); provided that the Lead Borrower shall have delivered a certificate of a Responsible Officer to the Administrative Agent at least five Business Days prior to the incurrence of such Indebtedness, together with a reasonably detailed description of the material terms and conditions of such Indebtedness or drafts of the documentation relating thereto, stating that the Lead Borrower has reasonably determined in good faith that such terms and conditions satisfy the foregoing requirement (and such certificate shall be conclusive evidence that such terms and conditions satisfy the foregoing requirement unless the Administrative Agent notifies the Lead Borrower within such five Business Day period that it disagrees with such determination (including a reasonably detailed description of the basis upon which it disagrees)); provided, further, that any such Indebtedness shall constitute Qualified Holding Company Indebtedness only if immediately after giving effect to the issuance or incurrence thereof and the use of proceeds thereof, no Event of Default shall have occurred and be continuing.

RCF Covenants” shall have the meaning assigned to such term in Section 6.10(c).

Refinanced Debt” shall have the meaning assigned to such term in the definition of the Credit Agreement Refinancing Indebtedness in this Section 1.01.

Refinanced Term Loans” shall have the meaning assigned to such term in Section 9.08(e).

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Refinancing Amendment” shall mean an amendment to this Agreement in form and substance reasonably satisfactory to the Administrative Agent and the Lead Borrower executed by each of (a) the Borrowers and Holdings, (b) the Administrative Agent, and (c) each additional Lender and existing Lender that agrees to provide any portion of the Credit Agreement Refinancing Indebtedness being incurred pursuant thereto, in accordance with Section 2.26.

 

Register” shall have the meaning assigned to such term in Section 9.04(b).

Regulation T” shall mean Regulation T of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

Regulation U” shall mean Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

Regulation X” shall mean Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

Related Fund” shall mean, with respect to any Lender that is a fund or commingled investment vehicle that invests in bank loans, any other fund that invests in bank loans and is managed or advised by the same investment advisor as such Lender or by an Affiliate of such investment advisor.

Related Parties” shall mean, with respect to any specified Person, such Person’s Affiliates and the respective directors, trustees, officers, employees, agents and advisors of such Person and such Person’s Affiliates.

Release” shall mean any release, spill, emission, leaking, dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching or migration into or through the environment or within or upon any building, structure, facility or fixture.

Replacement Term Loans” shall have the meaning assigned to such term in Section 9.08(e).

Repricing Transaction” shall mean the prepayment, refinancing, substitution or replacement of all or a portion of the Term B-1 Loans with the incurrence by the Borrowers or any of their respective Restricted Subsidiaries of any new or replacement tranche of term loans with an effective interest cost or weighted average yield (with the comparative determinations to be made by the Administrative Agent consistent with generally accepted financial practices, after giving effect to, among other factors, margin, interest rate floors, upfront or similar fees or original issue discount shared with all providers of such financing (but excluding upfront fees or original issue discount on the Term B-1 Loans), but excluding the effect of any arrangement, structuring, syndication or other fees payable in connection therewith that are not shared with all providers of such financing, and without taking into account any fluctuations in the LIBO Rate) that is less than the effective interest cost or weighted average yield (as determined by the Administrative Agent on the same basis) of the Term B-1 Loans, including without limitation, as may be effected through any amendment to this Agreement relating to the interest rate for, or weighted average yield of, the Term B-1 Loans; provided that it shall not constitute a Repricing Transaction if the applicable replacement indebtedness is incurred or the applicable amendment is effected in connection with a Change in Control.

Required Lenders” shall mean, at any time, Lenders having Loans and unused Commitments representing more than 50% of the sum of all Loans outstanding and unused Commitments at such time; provided, however, that any Loans or Commitments held by Holdings or the Affiliated Lenders in their capacity as Lenders shall be disregarded in the determination of the Required Lenders at any time.

Required Revolving Lenders” means, subject to Section 10.13, as of any date of determination, Revolving Lenders having more than 50% of the sum of the (a) outstanding Revolving Credit Exposure and (b) aggregate unused Revolving Commitments; provided that unused Revolving Commitments of, and the Revolving Credit Exposure held or deemed held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required Revolving Lenders.

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Responsible Officer” of any Person shall mean any executive officer, authorized person or Financial Officer of such Person and any other officer or similar official thereof responsible for the administration of the obligations of such Person in respect of this Agreement.

 

Restricted Indebtedness” shall mean Indebtedness of Holdings, the Borrowers or any of their respective Restricted Subsidiaries, the payment, prepayment, repurchase or defeasance of which is restricted under Section 6.09(b).

Restricted Payment” shall mean any dividend or other distribution (whether in cash, securities or other property) with respect to any Equity Interests in Holdings, the Borrowers or any of their respective Restricted Subsidiaries, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Equity Interests in Holdings, the Borrowers or any Restricted Subsidiary of the Lead Borrower.

Restricted Subsidiary” shall mean, with respect to any Person, any subsidiary of that Person other than an Unrestricted Subsidiary.

Returns” shall have the meaning assigned to such term in Section 3.14.

Revolving Borrowing” means Revolving Loans of the same Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

Revolving Commitment” means, with respect to each Revolving Lender, the amount set forth on Schedule 10.01 opposite such Revolving Lender’s name, or in the Assignment and Assumption pursuant to which such Revolving Lender shall have assumed its Revolving Commitment, as applicable, and giving effect to (a) any reduction in such amount from time to time pursuant to Section 10.09 and (b) any reduction or increase in such amount from time to time pursuant to assignments by or to such Lender pursuant to Section 9.04; provided, that at no time shall (a) the Revolving Credit Exposure of any Revolving Lender exceed its Revolving Commitment. As of the Amendment No. 3 Effective Date, the initial aggregate amount of the Revolving Lenders’ Revolving Commitments is $30,000,000.

Revolving Credit Exposure” means, with respect to any Lender at any time, the sum of the outstanding principal amount of such Lender’s Revolving Loans and its LC Exposure at such time.

Revolving Credit Facility Maturity Date” means the date that is ninety (91) days prior to the Term B-1 Loan Maturity Date; provided, however, if such date is not a Business Day, the Revolving Credit Facility Maturity Date” will be next Business Day immediately following such date.

Revolving Lenders” shall mean (a) the Persons listed on Schedule 10.01 (other than any such Person that has ceased to be a party hereto pursuant to an Assignment and Acceptance), and (b) any Person that has become a party hereto pursuant to an Assignment and Assumption in respect of Revolving Loans and/or Revolving Commitments, an Incremental Revolving Facility Amendment or a Refinancing Amendment.

Revolving Loan” means a Loan made pursuant to Section 10.03.

Revolving Note” shall have the meaning assigned to such term in Section 10.10(e).

S&P” shall mean Standard & Poor’s Ratings Services, a Standard & Poor’s Financial Services LLC business, and any successor to its rating agency business.

Sanctions” shall mean economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by (a) the U.S. government, including those administered by the Office of Foreign Assets Control of the U.S. Department of the Treasury or the U.S. Department of State, or (b) the United Nations Security Council, the European Union or Her Majesty’s Treasury of the United Kingdom.

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Sanctioned Country” shall mean, at any time, a country, region or territory which is itself the subject or target of any Sanctions (at the time of this Agreement, Cuba, Iran, North Korea, Sudan, Syria and Crimea).

 

Sanctioned Person” shall mean, at any time, (a) any Person listed in any Sanctions-related list of designated Persons maintained by the Office of Foreign Assets Control of the U.S. Department of the Treasury, the U.S. Department of State, the or by the United Nations Security Council, the European Union or any EU member state, (b) any Person operating, organized or resident in a Sanctioned Country or (c) any Person owned or controlled by any such Person or Persons.

Scheduled Extended Term Loan Repayment” shall have the meaning assigned to such term in Section 2.11(a)(iii).

Scheduled New Term Loan Repayment” shall have the meaning assigned to such term in Section 2.11(a)(ii).

Scheduled Other Term Loan Repayment” shall have the meaning assigned to such term in Section 2.11(a)(iv).

SEC” shall mean the Securities and Exchange Commission, and any successor agency thereto.

Secured Hedging Agreement” shall mean any Hedging Agreement permitted under Section 6.01(j) that is entered into by and between any Loan Party and any Hedging Bank, except for any such Hedging Agreement designated by the Lead Borrower in writing to the Administrative Agent as an “unsecured hedging agreement” as of the Closing Date or, if later, as of the time of entering into such Hedging Agreement; provided that for purposes of Section 7.02, any obligations outstanding under Secured Hedging Agreements shall be valued in accordance with the definition of Hedge Termination Value and further provided that that for the purposes of the Loan Documents in no circumstances shall any Excluded Swap Obligations constitute Obligations with respect to any Secured Hedge Agreement.

Secured Parties” shall mean, collectively, the Administrative Agent, the Collateral Agent, the Lenders, each Hedging Bank, each Cash Management Bank and each co-agent or sub-agent appointed by the Administrative Agent from time to time pursuant to Article VIII.

Securities Laws” shall mean the Securities Act of 1933, the Securities Exchange Act of 1934, the Sarbanes-Oxley Act of 2002 and, in each case, the rules and regulations of the SEC promulgated thereunder, and the applicable accounting and auditing principles, rules, standards and practices promulgated, approved or incorporated by the SEC or the Public Company Accounting Oversight Board, as each of the foregoing may be amended and in effect on any applicable date under this Agreement.

Security Agreement” shall mean, collectively, the Security Agreement executed by the Loan Parties, substantially in the form of Exhibit D, together with each security agreement supplement executed and delivered pursuant to Section 5.10.

Security Documents” shall mean the Mortgages, the Security Agreement, the Affiliate Subordination Agreement, the PR Mortgage, the PR Mortgage Note, the PR Mortgage Note Pledge and Security Agreement and corresponding financing statements, any Pari Passu Intercreditor Agreement (if entered into), any Junior Lien Intercreditor Agreement (if entered into) and each of the security agreements, mortgages and other instruments and documents executed and delivered pursuant to any of the foregoing or pursuant to Section 5.13.

Solvency Certificate” shall mean a certificate of the chief financial officer of Holdings substantially in the form attached as Exhibit I or such other form as shall be reasonably satisfactory to the Administrative Agent.

Specified Acquisition” shall mean the Permitted Acquisition consummated on or about the Amendment No. 3 Effective Date.

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Specified Disposition” shall mean any Disposition which generates net cash proceeds of at least $1,000,000.

 

Specified Transactions” shall mean any incurrence or repayment of Indebtedness (other than for working capital purposes) or Term Loan or Investment that results from a Person becoming a Restricted Subsidiary or an Unrestricted Subsidiary (including pursuant to Section 5.15), any Permitted Acquisition, any Specified Disposition, any Investment in excess of $2,000,000 or any Restricted Payment in excess of $2,000,000.

SPV” shall have the meaning assigned to such term in Section 9.04(g).

Stations” shall mean all radio and television broadcast stations owned by the Lead Borrower or any of its Restricted Subsidiaries.

Statutory Reserves” shall mean a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board and any other banking authority, domestic or foreign, to which the Administrative Agent or any Lender (including any branch, Affiliate or other fronting office making or holding a Loan) is subject for Eurocurrency Liabilities (as defined in Regulation D of the Board). Eurodollar Loans shall be deemed to constitute Eurocurrency Liabilities (as defined in Regulation D of the Board) and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D. Statutory Reserves shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

Subordinated Indebtedness” shall mean any Indebtedness of the Borrowers or any of their respective Restricted Subsidiaries that is expressly subordinated in right of payment to the Obligations.

subsidiary” shall mean, with respect to any Person (herein referred to as the “parent”), any corporation, partnership, limited liability company, association or other business entity of which securities or other ownership interests representing more than 50% of the equity or more than 50% of the ordinary voting power, at the time any determination is being made, directly or indirectly, owned, Controlled or held by such Person.

Subsidiary” shall mean any subsidiary of the Borrower.

Subsidiary Guarantor” shall mean each Restricted Subsidiary listed on Schedule 1.01(b), and each other Restricted Subsidiary that is or becomes a party to the Guaranty; provided that no CFC Holding Company and no Subsidiary that is a CFC shall be a Subsidiary Guarantor.

Swap Obligation” shall mean, with respect to any Guarantor, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of section 1a(47) of the Commodity Exchange Act.

Syndication Agent” shall mean Deutsche Bank Securities Inc.

Synthetic Lease” shall mean, as to any Person, any lease (including leases that may be terminated by the lessee at any time) of any property (whether real, personal or mixed) (a) that is accounted for as an operating lease under GAAP and (b) in respect of which the lessee retains or obtains ownership of the property so leased for U.S. federal income tax purposes, other than any such lease under which such Person is the lessor.

Synthetic Lease Obligations” shall mean, as to any Person, an amount equal to the capitalized amount of the remaining lease payments under any Synthetic Lease that would appear on a balance sheet of such person in accordance with GAAP if such obligations were accounted for as Capital Lease Obligations.

Synthetic Purchase Agreement” shall mean any swap, derivative or other agreement or combination of agreements pursuant to which Holdings, the Borrowers or any of their respective Restricted Subsidiaries is or may

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become obligated to make (a) any payment in connection with a purchase by any third party from a Person other than Holdings, the Borrowers or any of their respective Restricted Subsidiaries of any Equity Interest or Restricted Indebtedness or (b) any payment (other than on account of a permitted purchase by it of any Equity Interest or Restricted Indebtedness) the amount of which is determined by reference to the price or value at any time of any Equity Interest or Restricted Indebtedness; provided that no phantom stock or other equity-based plan providing for payments only to current or former directors, officers, consultants, advisors or employees of Holdings, the Borrowers, the Restricted Subsidiaries or their respective Affiliates (or to their heirs or estates) shall be deemed to be a Synthetic Purchase Agreement.

 

Taxes” shall mean any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

Televicentro of Puerto Rico, LLC” shall mean a Delaware limited liability company authorized to conduct business in the Commonwealth of Puerto Rico, which is subsidiary of InterMedia Español, Inc., and which will, concurrently with this Agreement, execute the PR Mortgage Note Pledge and Security Agreement and provide to the Collateral Agent, as collateral and guaranty of the Loans a pledge of the PR Mortgage Note.

Term Borrowing” shall mean a Borrowing comprised of Term Loans.

Term Lenders” shall mean (a) the Persons listed on Schedule 2.01 (other than any such Person that has ceased to be a party hereto pursuant to an Assignment and Acceptance), (b) the Additional Term B-1 Lender, (c) the Add-on Term B-1 Lender and (d) any Person that has become a party hereto pursuant to an Assignment and Acceptance in respect of any Term Loans, an Incremental Term Loan Assumption Agreement, a New Term Loan Commitment Agreement or a Refinancing Amendment.

Term B Loan” shall mean all Term B Loans outstanding under this Agreement immediately prior to the Amendment No. 2 Effective Date.

Term B-1 Commitments” shall mean the Additional Term B-1 Commitment and the Add-on Term B-1 Commitment.

Term B-1 Loan” shall have the meaning set forth in Section 2.01(a).

Term B-1 Loan Facility” shall mean the Term B-1 Commitments and the Term B-1 Loans.

Term B-1 Loan Maturity Date” shall mean February 14, 2024; provided that if such date is not a Business Day, the “Term B-1 Loan Maturity Date” will be next Business Day immediately following such date.

Term B-1 Loan Repayment Dates” shall have the meaning assigned to such term in Section 2.11(a).

Term Loans” shall mean the Initial Term Loans, the Term B Loans, the Term B-1 Loans, any Incremental Term Loans, any New Term Loans, any Other Term Loans, and any Extended Term Loans.

Term Loan Facility” shall mean the Term B-1 Loan Facility, any New Term Loan Facility, any term loan facility comprised of Incremental Term Loans, any term loan facility comprised of Other Term Loans and any term loan facility comprised of Extended Term Loans (in each case, including any increase thereto pursuant to Section 2.22).

Term Loan Lender” shall have the meaning assigned to such term in Section 2.02(a).

Term Loan Percentage” shall mean, (x) as to any Lender, after the applicable Term Loans are made, the ratio of (a) the outstanding principal balance of such Term Loan or Term Loans of such Lender to (b) the aggregate outstanding principal balance of all such Term Loans of all Lenders and (y) as to a Class of Term Loans, at any time, a fraction (expressed as a percentage), the numerator of which is equal to the aggregate outstanding principal

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amount of all Term Loans of such Class at such time and the denominator of which is equal to the aggregate outstanding principal amount of all Term Loans of all Classes at such time.

 

Term Note” shall have the meaning assigned to such term in Section 2.04(e).

Test Period” shall mean each period of four (4) consecutive Fiscal Quarters of the Lead Borrower then last ended, in each case taken as one accounting period.

Total Debt” shall mean, at any time, the total Indebtedness of the Lead Borrower and its Restricted Subsidiaries at such time (excluding (1) Indebtedness of the type described in clause (i), clause (j), clause (k), clause (l) and clause (m) of the definition of such term, except, in the case of such clause (j), to the extent any Hedging Agreement has been terminated and the obligations thereunder have not been settled, in the case of such clause (k), to the extent the specified payment obligations in respect of such Equity Interests are then due and payable and, in the case of such clauses (l) and clause (m), to the extent of any unreimbursed drawings thereunder and (2) Guarantees if the guaranteed Indebtedness is already included).

Total Net Leverage Ratio” shall mean, on any date, the ratio of (a) an amount equal to the excess of (i) Total Debt on such date over (ii) the aggregate amount of unrestricted cash and Cash Equivalents (up to a maximum aggregate amount of $60,000,000) that are included in the consolidated balance sheet of the Lead Borrower and its Restricted Subsidiaries as of such date to (b) Consolidated EBITDA for the Test Period most recently ended on or prior to such date.

Transaction Expenses” shall mean fees and expenses payable or otherwise borne by the Lead Borrower and its Restricted Subsidiaries in connection with the Transactions and incurred before, or on or about, the Closing Date, including the costs of legal and financial advisors to the Lead Borrower and the agents or trustees under this Agreement and prepayment fees and penalties in connection with the prepayment of the Existing Indebtedness on or about the Closing Date.

Transactions” shall mean, collectively, (a) the execution, delivery and performance by the Loan Parties of the Loan Documents to which they are a party and the making of the Term Loans, (b) the repayment of the Existing Indebtedness and the termination of any Liens in respect of the Existing Indebtedness and (c) the payment of the Transaction Expenses.

Type”, when used in respect of any Loan or Borrowing, shall refer to the Rate by reference to which interest on such Loan or on the Loans comprising such Borrowing is determined. For purposes hereof, the term “Rate” shall mean the Adjusted LIBO Rate and the Alternate Base Rate, as applicable.

UCC” shall mean the Uniform Commercial Code as in effect in the relevant jurisdiction, as amended or modified from time to time.

United States Tax Compliance Certificate” shall have the meaning assigned to such term in Section 2.20(f)(II)(iii).

Unrestricted Subsidiary” shall mean any Subsidiary of the Lead Borrower (other than WAPA PR) that is acquired or created after the Closing Date designated by the Lead Borrower as an Unrestricted Subsidiary hereunder by written notice to the Administrative Agent in accordance with Section 5.15.

USA PATRIOT Act” shall mean The Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Title III of Pub. L. No. 107-56 (signed into law October 26, 2001)).

Weighted Average Life to Maturity” shall mean, when applied to any Indebtedness, at any date, the quotient obtained by dividing (a) the sum of the products of the number of years from the date of determination to the date of each successive scheduled principal payment of such Indebtedness multiplied by the amount of such payment; by (b) the sum of all such payments.

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Wholly Owned Subsidiary” of any Person shall mean a subsidiary of such Person of which securities (except for directors’ qualifying shares) or other ownership interests representing 100% of the Equity Interests are, at the time any determination is being made, owned, Controlled or held by such Person or one or more wholly owned Subsidiaries of such Person or by such Person and one or more wholly owned Subsidiaries of such Person.

 

Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result of a complete or partial withdrawal by the Borrower or an ERISA Affiliate from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

Write-Down and Conversion Powers” means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.

Section 1.02 Terms Generally. The definitions in Section 1.01 shall apply equally to both the singular and plural forms of the terms defined. Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.” The word “will” shall be construed to have the same meaning and effect as the word “shall”; and the words “asset” and “property” shall be construed as having the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights. All references herein to Articles, Sections, Exhibits and Schedules shall be deemed references to Articles and Sections of, and Exhibits and Schedules to, this Agreement unless the context shall otherwise require. Except as otherwise expressly provided herein, any reference in this Agreement to any Loan Document or any other document evidencing Indebtedness permitted hereunder shall mean such document as amended, restated, supplemented or otherwise modified from time to time, in each case, in accordance with the terms of this Agreement and the other Loan Documents.

Section 1.03 Accounting Terms. All accounting terms not specifically or completely defined herein shall be construed in conformity with GAAP, applied on a consistent basis, as in effect from time to time and in a manner consistent with that used in preparing the audited financial statements required by Section 5.04(a), except as otherwise specifically prescribed herein (including, without limitation, as prescribed by Section 9.19). Notwithstanding any other provision contained herein, (x) any lease that is treated as an operating lease for purposes of GAAP as of the date hereof shall not be treated as Indebtedness or as a Capital Lease Obligation and shall continue to be treated as an operating lease (and any future lease, if it were in effect on the date hereof, that would be treated as an operating lease for purposes of GAAP as of the date hereof shall be treated as an operating lease), in each case for purposes of this Agreement, notwithstanding any actual or proposed change in or application of GAAP after the date hereof, and (y) for purposes of determining compliance with any covenant (including the computation of any financial ratio) contained herein, Indebtedness of the Lead Borrower and its Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof, and the effects of FASB ASC 825 and FASB ASC 470-20 on financial liabilities shall be disregarded.

Section 1.04 Pro Forma Calculations.

(a)       Notwithstanding anything to the contrary herein, the First Lien Net Leverage Ratio and the Total Net Leverage Ratio shall be calculated in the manner prescribed by this Section 1.04; provided that, notwithstanding anything to the contrary in clause (b), (c) or (d) of this Section 1.04, when calculating the First Lien Net Leverage Ratio for purposes of the Applicable Excess Cash Flow Percentage the events described in this Section 1.04 that occurred subsequent to the end of the applicable Test Period shall not be given pro forma effect.

(b)       For purposes of calculating the First Lien Net Leverage Ratio and the Total Net Leverage Ratio, Specified Transactions (and the incurrence or repayment of any Indebtedness in connection therewith) that have been made (i) during the applicable Test Period and (ii) subsequent to such Test Period and prior to or simultaneously with the event for which the calculation of any such ratio is made shall be calculated on a Pro Forma Basis assuming that all such Specified Transactions (and any increase or decrease in Consolidated EBITDA and the component financial definitions used therein attributable to any Specified Transaction) had occurred on the first day of the applicable Test Period. If since the beginning of any applicable Test Period any Person that subsequently

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became a Subsidiary or was merged, amalgamated or consolidated with or into the Lead Borrower or any of its Restricted Subsidiaries since the beginning of such Test Period shall have made any Specified Transaction that would have required adjustment pursuant to this Section 1.04, then the First Lien Net Leverage Ratio and the Total Net Leverage Ratio shall be calculated to give pro forma effect thereto in accordance with this Section 1.04. Notwithstanding the foregoing, (x) when calculating the First Lien Net Leverage Ratio for purposes of determining actual compliance (and not compliance on a Pro Forma Basis) with the Financial Covenant, any Specified Transaction (other than the Specified Acquisition) and any related adjustment contemplated in the definition of Pro Forma Basis (and corresponding provisions of the definition of Consolidated EBITDA) that occurred subsequent to the end of the applicable four quarter period shall not be given Pro Forma Effect and (y) when calculating the First Lien Net Leverage Ratio for purposes of the Applicable Rate and the Financial Covenant, the Specified Acquisition and any related adjustment contemplated in the definition of Pro Forma Basis (and corresponding provisions of the definition of Consolidated EBITDA) that has occurred shall not be given Pro Forma Effect, and shall instead be calculated on an actual basis commencing with the date the Specified Acquisition has been consummated.

 

(c)       Whenever pro forma effect is to be given to a Specified Transaction, the pro forma calculations shall be made in good faith by a Responsible Officer of the Lead Borrower in accordance with the terms of this Agreement.

(d)       In the event that the Lead Borrower or any Restricted Subsidiary of the Lead Borrower incurs (including by assumption or guarantees) or repays (including by redemption, repayment, retirement or extinguishment) any Indebtedness included in the calculations of the First Lien Net Leverage Ratio and the Total Net Leverage Ratio, as the case may be (in each case, other than Indebtedness incurred or repaid under any revolving credit facility in the ordinary course of business for working capital purposes), (i) during the applicable Test Period and (ii) subsequent to the end of the applicable Test Period and prior to or simultaneously with the event for which the calculation of any such ratio is made, then the First Lien Net Leverage Ratio and the Total Net Leverage Ratio shall be calculated giving pro forma effect to such incurrence or repayment of Indebtedness, to the extent required, as if the same had occurred on the last day of the applicable Test Period.

(e)        Notwithstanding anything in this Agreement to the contrary, with respect to any Designated Acquisition and the incurrence of any Designated Indebtedness (including Incremental Term Loans or New Term Loans) or Lien in connection therewith, compliance with any financial test required by this Agreement for such Designated Acquisition and such Designated Indebtedness shall be determined on the date the definitive acquisition agreement for such Designated Acquisition is entered into (and not at the time of closing of such Designated Acquisition or the incurrence of such Designated Indebtedness) and, thereafter until consummation of such Designated Acquisition or the termination of such definitive agreement relating to such Designated Acquisition, all other incurrence tests under this Agreement shall be required to be complied with on an actual basis without giving effect to such Designated Indebtedness or Designated Acquisition and on a pro forma basis after giving effect to such Designated Acquisition and the incurrence of such Designated Indebtedness.

Section 1.05 Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be classified and referred to by Class (e.g., a “New Term Loan” or a “Revolving Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a “Eurodollar New Term Loan” or a “Eurodollar Revolving Loan”). Borrowings also may be classified and referred to by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar Revolving Borrowing”).

Section 1.06 Currency Equivalents Generally. Unless otherwise set forth herein, any amount specified in this agreement in Dollars shall include the Equivalent in Dollars of such amount in any foreign currency and if any amount described in this Agreement is comprised of amounts in Dollars and amounts in one or more foreign currencies, the Equivalent in Dollars of such foreign currency amounts shall be used to determine the total. For purposes of this Section 1.06, “Equivalent” in Dollars of any foreign currency on any date means the equivalent in Dollars of such foreign currency by using the applicable spot rate set forth on the Bloomberg Cross Currency Rates Page for such currency.

Section 1.07 Rounding. Any financial ratios required to be maintained by the Lead Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the

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result to one place more than the number of places by which such ratio or percentage is expressed herein and rounding the result up or down to the nearest number (with a rounding-up if there is no nearest number).

 

Section 1.08 References to Laws. Unless otherwise expressly provided herein, references to any Applicable Law shall include all statutory and regulatory provisions consolidating, amending, replacing, supplementing or interpreting such Applicable Law.

Section 1.09 Times of Day. Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).

Section 1.10 Covenant Compliance Generally. For purposes of determining compliance under Article VI, any amount in a currency other than Dollars will be converted to Dollars in a manner consistent with that used in calculating Consolidated Net Income in the annual financial statements of Parent and its Subsidiaries or Holdings and its Subsidiaries, as applicable, delivered pursuant to Section 5.04(a) or (b), as applicable. Notwithstanding the foregoing, for purposes of determining compliance with any limitations or thresholds set forth in Dollars in Article VI, with respect to any amount in a currency other than Dollars, no breach of any basket contained in such Article shall be deemed to have occurred solely as a result of changes in rates of exchange occurring after the time such amount is incurred; provided that for the avoidance of doubt, the foregoing provisions of this Section 1.10 shall otherwise apply to such Article, including with respect to determining whether any amount may be incurred at any time under such Article. If any of the baskets set forth in Article VI of this Agreement are exceeded solely as a result of fluctuations to Consolidated Total Assets for the most recently completed Fiscal Quarter after the last time such baskets were calculated for any purpose under Article VI, such baskets will not be deemed to have been exceeded solely as a result of such fluctuations.

Section 1.11 Available Amount Transactions. If more than one action occurs on any given date the permissibility of the taking of which is determined hereunder by reference to the amount of the Available Amount Basket immediately prior to the taking of such action, the permissibility of the taking of each such action shall be determined independently and in no event may any two or more such actions be treated as occurring simultaneously.

Section 1.12 Interest Rate Calculations. All computations of interest and other fees hereunder shall be made on the basis of a 360-day year (except for interest calculated by reference to the Prime Rate, which shall be based on a year of 365 or 366 days, as applicable) and for the actual number of days elapsed (including the first day but excluding the last day) occurring in the period for which such interest or fees are payable.

ARTICLE II

Term Loan Facilities

Section 2.01 Commitments.

(a)       Subject to the terms and conditions and relying upon the representations and warranties set forth herein,

(i)       the Add-on Term B-1 Lender agrees to make a loan (the “Add-on Term B-1 Loan”) to the Borrowers on the Amendment No. 3 Effective Date in a principal amount not to exceed its Add-on Term B-1 Loan Commitment. The Add-on Term B-1 Loan together with the Additional Term B-1 Loan and the loans established pursuant to subclause (iii) below from the Converted Term B Loans are referred to collectively as the “Term B-1 Loans” and each a “Term B-1 Loan”). The Add-on Term B-1 Loan shall initially take the form of a pro rata increase in each outstanding borrowing of Term B-1 Loans.

(ii)       On the Amendment No. 2 Effective Date, the Additional Term B-1 Lender made a loan (the “Additional Term B-1 Loan”) to the Borrowers in a principal amount not to exceed its Additional Term B-1 Loan Commitment.

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(iii)       On the Amendment No. 2 Effective Date, each Converted Term B Loan of each Amendment No. 2 Consenting Lender converted into a loan with the same Type and Class as the Additional Term B-1 Loan effective as of the Amendment No. 2 Effective Date in a principal amount equal to the principal amount of such Lender’s Converted Term B Loan immediately prior to such conversion.

 

(iv)       Amounts borrowed under Section 2.01(a) and subsequently repaid or prepaid may not be reborrowed.

(b)       Subject to the terms and conditions of this Agreement, each Lender having an Incremental Term Loan Commitment under a class pursuant to Section 2.22 severally and not jointly, agrees subject to the terms and conditions and relying upon the representations and warranties set forth herein and in the applicable Incremental Term Loan Assumption Agreement, to make Incremental Term Loans to the Borrowers, in an aggregate principal amount not to exceed its Incremental Term Loan Commitment. Amounts paid or prepaid in respect of Incremental Term Loans may not be reborrowed.

(c)       Subject to the terms and conditions of this Agreement, each New Term Loan Lender with a New Term Loan Commitment for a given Class of New Term Loans pursuant to Section 2.23 severally and not jointly agrees, subject to the terms and conditions and relying upon the representations and warranties set forth herein and in the applicable New Term Loan Commitment Agreement, to make New Term Loans to the Borrowers, which New Term Loans shall not exceed for any such New Term Loan Lender at the time of any incurrence thereof, the New Term Loan Commitment of such New Term Loan Lender for such Class on the respective New Term Loan Borrowing Date. Amounts paid or prepaid in respect of New Term Loans may not be reborrowed.

(d)       Subject to the terms and conditions of this Agreement, each Term Loan Lender with an Other Term Loan Commitment for a given Class of Other Term Loans severally agrees to make Other Term Loans to the Borrowers, which Other Term Loans shall not exceed for any such Term Loan Lender at the time of any incurrence thereof, the Other Term Loan Commitment of such Term Loan Lender for such Class on the respective Other Term Loan Borrowing Date. Amounts paid or prepaid in respect of Other Term Loans may not be reborrowed.

Section 2.02 Term Loans.

(a)       Each Term Loan shall be made as part of a Borrowing consisting of such Term Loans made by the applicable Lenders (each, a “Term Loan Lender”) ratably in accordance with their applicable Commitments, respectively; provided, however, that the failure of any Lender to make a Term Loan shall not in itself relieve any other Lender of its obligation to lend hereunder (it being understood, however, that no Lender shall be responsible for the failure of any other Lender to make a Term Loan required to be made by such other Lender). The Term Loans comprising any Borrowing shall be in an aggregate principal amount that is (i) an integral multiple of $1,000,000 and not less than $5,000,000, or (ii) equal to the remaining available balance of the applicable Commitments.

(b)       Subject to Sections 2.08 and 2.15 each Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as the Lead Borrower may request pursuant to Section 2.03. Each Lender may at its option make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Term Loan; provided that any exercise of such option shall not affect the obligation of the applicable Borrower to repay such Term Loan in accordance with the terms of this Agreement. Borrowings of more than one Type may be outstanding at the same time; provided, however, that the Lead Borrower shall not be entitled to request any Borrowing that, if made, would result in more than 8 Eurodollar Borrowings outstanding hereunder at any time. For purposes of the foregoing, Borrowings having different Interest Periods, regardless of whether they commence on the same date, shall be considered separate Borrowings.

(c)       Each Lender shall make each Term Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds to such account in New York City as the Administrative Agent may designate not later than 1:00 p.m., New York City time, and the Administrative Agent shall promptly credit the amounts so received to an account designated by the Lead Borrower in the applicable Borrowing Request or, if a Borrowing shall not occur on such date because any condition precedent herein specified shall not have been met, return the amounts so received to the respective Lenders.

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(d)       Unless the Administrative Agent shall have received notice from a Lender prior to the date of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s portion of such Borrowing, the Administrative Agent may assume that such Lender has made such portion available to the Administrative Agent on the date of such Borrowing in accordance with paragraph (c) above and the Administrative Agent may, in reliance upon such assumption, make available to the applicable Borrower on such date a corresponding amount. If the Administrative Agent shall have so made funds available then, to the extent that such Lender shall not have made such portion available to the Administrative Agent, such Lender and the applicable Borrower severally agree to repay to the Administrative Agent forthwith on demand such corresponding amount together with interest thereon, for each day from the date such amount is made available to the applicable Borrower to but excluding the date such amount is repaid to the Administrative Agent at (i) in the case of the applicable Borrower, a rate per annum equal to the interest rate applicable at the time to the Term Loans comprising such Borrowing and (ii) in the case of such Lender, a rate determined by the Administrative Agent to represent its cost of overnight or short term funds (which determination shall be conclusive absent manifest error). If such Lender shall repay to the Administrative Agent such corresponding amount, such amount shall constitute such Lender’s Term Loan as part of such Borrowing for purposes of this Agreement.

 

Section 2.03 Borrowing Procedure. In order to request a Borrowing, the Lead Borrower shall notify the Administrative Agent of such request by telephone (a) in the case of a Eurodollar Borrowing, not later than 12:00 (noon), New York City time, three Business Days (or, in the case of the Term B-1 Loans to be borrowed on the Amendment No. 2 Effective Date or the Amendment No. 3 Effective Date, such later time as may be agreed by the Administrative Agent) before a proposed Borrowing, and (b) in the case of an ABR Borrowing, not later than 12:00 noon, New York City time, one Business Day before a proposed Borrowing. Each such telephonic Borrowing Request shall be irrevocable, and shall be confirmed promptly by hand delivery or fax to the Administrative Agent of a written Borrowing Request and shall specify the following information: (i) whether such Borrowing is to be a Eurodollar Borrowing or an ABR Borrowing; (ii) the date of such Borrowing (which shall be a Business Day); (iii) the number and location of the account to which funds are to be disbursed; (iv) the amount of such Borrowing; and (v) if such Borrowing is to be a Eurodollar Borrowing, the Interest Period with respect thereto; provided, however, that, notwithstanding any contrary specification in any Borrowing Request, each requested Borrowing shall comply with the requirements set forth in Section 2.02. If no election as to the Type of Borrowing is specified in any such notice, then the requested Borrowing shall be an ABR Borrowing. If no Interest Period with respect to any Eurodollar Borrowing is specified in any such notice, then the Lead Borrower shall be deemed to have selected an Interest Period of one month’s duration. The Administrative Agent shall promptly advise the applicable Lenders of any notice given pursuant to this Section 2.03 (and the contents thereof), and of each Lender’s portion of the requested Borrowing.

Section 2.04 Evidence of Debt; Repayment of Term Loans.

(a)       The Borrowers hereby unconditionally promise to pay, on a joint and several basis to the Administrative Agent for the account of each Term Lender the principal amount of each Term Loan of such Term Lender made available to them as provided in Section 2.11.

(b)       Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the indebtedness of the Lead Borrower to such Lender resulting from each Term Loan made by such Lender from time to time to such Borrower, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.

(c)       The Administrative Agent shall maintain accounts in which it will record (i) the amount of each Loan made hereunder, the Class and Type thereof and, if applicable, the Interest Period applicable thereto, (ii) the amount of any principal or interest due and payable or to become due and payable from the applicable Borrower to each Lender hereunder and (iii) the amount of any sum received by the Administrative Agent hereunder from the Borrowers or any Guarantor and each Lender’s share thereof.

(d)       The entries made in the accounts maintained pursuant to paragraphs (b) and (c) above shall be prima facie evidence of the existence and amounts of the obligations therein recorded; provided, however, that the failure of any Lender or the Administrative Agent to maintain such accounts or any error therein shall not in any

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manner affect the obligations of the Lead Borrower to repay the Term Loans made available to them in accordance with their terms.

 

(e)       Any Lender may request that Term Loans made by it hereunder be evidenced by a promissory note (each such note, a “Term Note”). In such event, the applicable Borrower shall execute and deliver to such Lender a promissory note payable to such Lender and its registered assigns and in a form and substance reasonably acceptable to the Administrative Agent and the Lead Borrower. Notwithstanding any other provision of this Agreement, in the event any Lender shall request and receive such a promissory note, the interests represented by such note shall at all times (including after any assignment of all or part of such interests pursuant to Section 9.04) be represented by one or more promissory notes payable to the payee named therein or its registered assigns.

(f)       The Borrowers shall repay to the Administrative Agent for the ratable account of the Lenders holding Term B Loans that are not Converted Term B Loans, the outstanding balance of such Term B Loans that are not Converted Term B Loans on the Amendment No. 2 Effective Date.

Section 2.05 Fees.

(a)       The Lead Borrower shall pay, or shall cause WAPA PR to pay to the Administrative Agent, for its own account, such administrative fees as have been separately agreed in writing in the amounts and at the times so specified.

(b)       In the event that the Term B-1 Loans are prepaid in whole or in part pursuant to Section 2.12(a) or Section 2.13(c), or in the event of an assignment of Term B-1 Loans pursuant to Section 2.21(a)(iv), in each case, in connection with a Repricing Transaction on or prior to the six month anniversary of the Amendment No. 2 Effective Date, the applicable Borrower shall pay to the relevant Lenders a prepayment fee (the “Prepayment Fee”) equal to 1.00% of the principal amount so prepaid or assigned.

(c)       All such Fees shall be paid on the dates due, in immediately available funds, to the Administrative Agent or the Collateral Agent, as the case may be. Once paid, none of the Fees shall be refundable under any circumstances.

Section 2.06 Interest on Loans.

(a)       Subject to the provisions of Section 2.07, the Term B-1 Loans comprising any ABR Borrowing shall bear interest at a rate per annum equal to the Alternate Base Rate plus the relevant Applicable Margin.

(b)       Subject to the provisions of Section 2.07, the Term B-1 Loans comprising any Eurodollar Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the Applicable Margin.

(c)       Interest on each Term Loan shall be payable on the Interest Payment Dates applicable to such Term Loan except as otherwise provided in this Agreement; provided that interest with respect to all Term B Loans shall be payable on the Amendment No. 2 Effective Date. The applicable Adjusted LIBO Rate for each Interest Period or day within an Interest Period, as the case may be, and the Alternate Base Rate shall be determined by the Administrative Agent, and such determination shall be conclusive absent manifest error.

Section 2.07 Default Interest. If the Borrowers shall default in the payment of any principal of or interest on any Loan or any other amount due hereunder or under any other Loan Document, by acceleration or otherwise, then, until such defaulted amount shall have been paid in full, overdue principal and, to the extent permitted by law, overdue interest in respect of each Loan under this Agreement shall automatically (without the need of any vote by the Required Lenders) bear interest (after as well as before judgment) at a rate per annum equal to the rate otherwise applicable to such Loan pursuant to Section 2.06 or Section 10.05, as applicable, plus 2.00% per annum and all other overdue amounts payable hereunder and under any other Loan Document shall bear interest at a rate per annum equal to the rate which is 2.00% in excess of the rate applicable to Term Loans that are maintained as ABR Loans from time to time. All accrued and unpaid interest under this Section 2.07 shall be due

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and payable on demand of the Administrative Agent. Interest shall continue to accrue on the Obligations after the filing by or against any Borrower of any petition seeking any relief or remedy under any applicable Debtor Relief Laws.

 

Section 2.08 Alternate Rate of Interest. Prior to the payoff of all Term B-1 Loans, in the event, and on each occasion, that on the day two Business Days prior to the commencement of any Interest Period for a Eurodollar Borrowing the Administrative Agent shall have determined that the LIBO Rate cannot be determined or the Required Lenders have advised the Administrative Agent that the rates at which such Dollar deposits, as applicable, are being offered will not adequately and fairly reflect the cost to the majority of the Lenders of making or maintaining the applicable Eurodollar Loans during such Interest Period, the Administrative Agent shall, as soon as practicable thereafter, give written or fax notice of such determination to the Lead Borrower and the Lenders. In the event of any such determination, until the Administrative Agent shall have advised the Lead Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, any request by the Lead Borrower (on behalf of itself or WAPA PR) for a Eurodollar Borrowing pursuant to Section 2.03 or 2.10 shall be deemed to be a request for an ABR Borrowing. Each determination by the Administrative Agent under this Section 2.08 shall be conclusive absent manifest error. Upon the payoff of all Term B-1 Loans, this Section 2.08 automatically shall cease to be in force and effect and the provisions of Schedule 2.08 automatically shall apply.

Section 2.09 Termination of Term B-1 Commitments. The Additional Term B-1 Commitment of the Additional Term B-1 Lender shall be automatically and permanently reduced to $0 upon the funding of the Additional Term B-1 Loans to be made on the Amendment No. 2 Effective Date. The Add-on Term B-1 Commitment of the Add-on Term B-1 Lender shall be automatically and permanently reduced to $0 upon the funding of the Add-on Term B-1 Loans to be made on the Amendment No. 3 Effective Date.

Section 2.10 Conversion and Continuation of Borrowings. The Borrowers shall have the right at any time upon prior irrevocable notice to the Administrative Agent (a) not later than 12:00 (noon), New York City time, one Business Day prior to conversion, to convert any Eurodollar Borrowing into an ABR Borrowing, (b) not later than 12:00 (noon), New York City time, three Business Days prior to conversion or continuation, to convert any ABR Borrowing into a Eurodollar Borrowing or to continue any Eurodollar Borrowing as a Eurodollar Borrowing for an additional Interest Period, and (c) not later than 12:00 (noon), New York City time, three Business Days prior to conversion, to convert the Interest Period with respect to any Eurodollar Borrowing to another permissible Interest Period, subject in each case to the following:

(a)       each conversion or continuation shall be made pro rata among the applicable Lenders in accordance with the respective principal amounts of the Loans comprising the converted or continued Borrowing;

(b)       if less than all the outstanding principal amount of any Borrowing shall be converted or continued, then each resulting Borrowing shall satisfy the limitations specified in Sections 2.02(a) and 2.02(b) regarding the principal amount and maximum number of Borrowings of the relevant Type;

(c)       each conversion shall be effected by each Lender and the Administrative Agent by recording for the account of such Lender the new Term Loan of such Lender resulting from such conversion and reducing the Term Loan (or portion thereof) of such Lender being converted by an equivalent principal amount; accrued interest on any Eurodollar Loan (or portion thereof) being converted shall be paid by the applicable Borrower at the time of conversion;

(d)       if any Eurodollar Borrowing is converted at a time other than the end of the Interest Period applicable thereto, the applicable Borrower shall pay, upon demand, any amounts due to the applicable Lenders pursuant to Section 2.16;

(e)       any portion of a Borrowing maturing or required to be repaid in less than one month may not be converted into or continued as a Eurodollar Borrowing;

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(f)       any portion of a Eurodollar Borrowing that cannot be converted into or continued as a Eurodollar Borrowing by reason of the immediately preceding clause shall be automatically converted at the end of the Interest Period in effect for such Borrowing into an ABR Borrowing;

 

(g)       no Interest Period may be selected for any Eurodollar Borrowing that would end later than a Term B-1 Loan Repayment Date, the date of a Scheduled New Term Loan Repayment, the date of a Scheduled Extended Term Loan Repayment or the date of a Scheduled Other Term Loan Repayment, as the case may be, occurring on or after the first day of such Interest Period if, after giving effect to such selection, the aggregate outstanding amount of (A) the Eurodollar Borrowings comprised of Term B-1 Loans, Other Term Loans or New Term Loans, as applicable, with Interest Periods ending on or prior to such Term B-1 Loan Repayment Date, date of a Scheduled New Term Loan Repayment, date of a Scheduled Extended Term Loan Repayment or date of a Scheduled Other Term Loan Repayment, as the case may be, and (B) the ABR Borrowings comprised of Term B-1 Loans, Other Term Loans or New Term Loans, as applicable, would not be at least equal to the principal amount of ABR Borrowings to be paid on such Term B-1 Loan Repayment Date, date of a Scheduled New Term Loan Repayment, date of a Scheduled Extended Term Loan Repayment or date of a Scheduled Other Term Loan Repayment as the case may be; and

(h)       upon notice to the Lead Borrower from the Administrative Agent given at the request of the Required Lenders, after the occurrence and during the continuance of a Default or Event of Default, no outstanding Term Loan may be converted into, or continued as, a Eurodollar Loan.

Each notice pursuant to this Section 2.10 shall be irrevocable and shall refer to this Agreement and specify (i) the identity and amount of the Borrowing that the Borrowers request be converted or continued, (ii) whether such Borrowing is to be converted to or continued as a Eurodollar Borrowing or an ABR Borrowing, (iii) if such notice requests a conversion, the date of such conversion (which shall be a Business Day) and (iv) if such Borrowing is to be converted to or continued as a Eurodollar Borrowing, the Interest Period with respect thereto. If no Interest Period is specified in any such notice with respect to any conversion to or continuation as a Eurodollar Borrowing, the Borrowers shall be deemed to have selected an Interest Period of one month’s duration. The Administrative Agent shall advise the Lenders of any notice given pursuant to this Section 2.10 and of each Lender’s portion of any converted or continued Borrowing. If the Borrowers shall not have given notice in accordance with this Section 2.10 to continue any Borrowing into a subsequent Interest Period (and shall not otherwise have given notice in accordance with this Section 2.10 to convert such Borrowing), such Borrowing shall, at the end of the Interest Period applicable thereto (unless repaid pursuant to the terms hereof), automatically be continued as an ABR Borrowing.

Section 2.11 Repayment of Term Borrowings.

(a)       (i) The Borrowers shall pay to the Administrative Agent, for the ratable benefit of the Lenders of Term B-1 Loans, on the last Business Day of each March, June, September and December commencing on (A) June 30, 2017 and prior to June 30, 2021, 0.25% of the principal amount of the Term B-1 Loans funded on the Amendment No. 2 Effective Date (it being understood that the Add-on Term B-1 Loans were funded following the required payment date on March 31, 2021 and shall not participate in such prepayment) and (ii) June 30, 2021 (each, a “Term B-1 Loan Repayment Date”), a principal amount of the Term B-1 Loans equal to $663,915.80 (as adjusted from time to time pursuant to Sections 2.11(b), 2.12, 2.13(e) and 2.22(d)), with the balance payable on the Term B-1 Loan Maturity Date.

(ii)       The Borrowers shall make scheduled quarterly installments with respect to the aggregate outstanding principal amount of each New Term Loan (if any) as determined pursuant to, and in accordance with, Section 2.23 (each such repayment, as the same may be adjusted from time to time pursuant to Sections 2.11(b), 2.12, 2.13(e) or 2.22, a “Scheduled New Term Loan Repayment”).

(iii)       The Borrowers shall make scheduled quarterly installments with respect to the aggregate outstanding principal amount of each Extended Term Loan (if any) as determined pursuant to, and in accordance with, Section 2.25 (each such repayment, as the same may be adjusted from time to time pursuant to Sections 2.11(b), 2.12, 2.13(e) or 2.22, a “Scheduled Extended Term Loan Repayment”).

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(iv)       The Borrowers shall make scheduled quarterly installments with respect to the aggregate outstanding principal amount of each Other Term Loan (if any) as determined pursuant to, and in accordance with, Section 2.26 (each such repayment, as the same may be adjusted from time to time pursuant to Sections 2.11(b), 2.12, 2.13(e) or 2.22, a “Scheduled Other Term Loan Repayment”).

 

(b)       To the extent not previously paid, the Term B-1 Loans, Incremental Term Loans, New Term Loans, Extended Term Loans and Other Term Loans shall be due and payable together with accrued and unpaid interest on the principal amount to be paid to but excluding the date of payment on the applicable Maturity Date.

(c)       All repayments pursuant to this Section 2.11 shall be subject to Section 2.16, but shall otherwise be without premium or penalty.

Section 2.12 Voluntary Prepayment.

(a)       The Borrowers shall have the right at any time and from time to time to prepay any Borrowing, in whole or in part, upon at least three Business Days’ prior written or fax notice (or telephone notice promptly confirmed by written or fax notice) in the case of Eurodollar Loans, or written or fax notice (or telephone notice promptly confirmed by written or fax notice) at least one Business Day prior to the date of prepayment in the case of ABR Loans, to the Administrative Agent before 12:00 (noon), New York City time; provided, however, that each partial prepayment shall be in an amount that is an integral multiple of $1,000,000 and not less than $1,000,000.

(b)       Voluntary prepayments of Loans shall be applied to the Class of Term Loans selected by the Borrowers (it being understood that in the case of a prepayment of any Term B-1 Loans, such prepayments shall be applied on a pro rata basis to all Term B-1 Loans (including the Add-on Term B-1 Loans, on a pro rata basis) and to the outstanding principal amounts due on a Term Loan Repayment Date of each such Class of Term Loans as directed by the Borrowers (or in the absence of direction, in direct order of maturity).

(c)       Each notice of prepayment shall specify the prepayment date and the principal amount of each Borrowing (or portion thereof) to be prepaid, shall be irrevocable and shall commit the applicable Borrower to prepay such Borrowing by the amount stated therein on the date stated therein; provided, however, that if such prepayment is for all of the then outstanding Loans, then the applicable Borrower may revoke such notice and/or extend the prepayment date by not more than five Business Days; provided, further, however, that the provisions of Section 2.16 shall apply with respect to any such revocation or extension. All prepayments under this Section 2.12 shall be subject to Section 2.05(b) and Section 2.16 but otherwise without premium or penalty. All prepayments under this Section 2.12 shall be accompanied by accrued and unpaid interest on the principal amount to be prepaid to but excluding the date of payment.

Section 2.13 Mandatory Prepayments.

(a)       Subject to Section 2.13(g), not later than the tenth Business Day following the receipt of Net Cash Proceeds by Holdings or any of its Restricted Subsidiaries in respect of (A) one or more Asset Sales in an aggregate amount in excess of $3,000,000 per annum (other than any Disposition of any property or assets permitted by Section 6.05 (except Section 6.05(b)(xi) and (b)(xvii))) or (B) one or more Casualty Events in an aggregate amount in excess of $3,000,000 per annum, the Lead Borrower shall apply the Net Cash Proceeds received with respect thereto to prepay outstanding Term Loans in accordance with Section 2.13(d); provided that if at the time any such prepayment would be required with any Net Cash Proceeds pursuant to this clause (a), the Lead Borrower is required to offer to repurchase the Permitted First Priority Refinancing Debt or any New Incremental Notes that are secured on a pari passu basis with the Obligations (or any Permitted Refinancing thereof that is secured on a pari passu basis with the Obligations) pursuant to the terms of the documentation governing such Indebtedness with such Net Cash Proceeds in respect of any such Asset Sale or any such Casualty Event (such Indebtedness (or Permitted Refinancing thereof) required to be offered to be so repurchased, “Other Applicable Indebtedness”), then the Lead Borrower may apply such Net Cash Proceeds on a pro rata basis (determined on the basis of the aggregate outstanding principal amount of the Term Loans and Other Applicable Indebtedness at such time); provided, further that the portion of such Net Cash Proceeds allocated to the Other Applicable Indebtedness shall not exceed the amount of such Net Cash Proceeds required to be allocated to the Other Applicable Indebtedness pursuant to the terms thereof, and the remaining amount, if any, of such Net Cash Proceeds shall be allocated to the Term Loans in

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accordance with the terms hereof) to the prepayment of the Term Loans and to the repurchase or prepayment of Other Applicable Indebtedness, and the amount of prepayment of the Term Loans that would have otherwise been required pursuant to this clause (a) shall be reduced accordingly; provided, further, that to the extent the holders of Other Applicable Indebtedness decline to have such indebtedness repurchased or prepaid, the declined amount shall promptly (and in any event within ten (10) Business Days after the date of such rejection) be applied to prepay the Term Loans pursuant to this clause (a). Notwithstanding the foregoing, the amount of Net Cash Proceeds from any Asset Sale or Casualty Event required to be (x) reinvested in assets (other than working capital assets) used or useful in the business of the Lead Borrower and its Restricted Subsidiaries or (y) applied to repay outstanding Term Loans, in each case as provided in this Section 2.13(a), shall be reduced on a dollar-for-dollar basis by the amount of any investment (not funded with Net Cash Proceeds from any other Asset Sale or Casualty Event that previously reduced a Loan Party’s or its Restricted Subsidiary’s obligation to repay Loans pursuant to this Section 2.13(a)) made by the Lead Borrower or any of its Restricted Subsidiaries in assets (other than working capital assets) used or useful in the business of the Lead Borrower and its Restricted Subsidiaries (including pursuant to a Permitted Acquisition (including a Permitted Acquisition of the equity interests in another Person)) within 90 days prior to the receipt of such Net Cash Proceeds.

 

(b)       On each Excess Cash Flow Payment Date, the Lead Borrower shall make mandatory principal prepayments of the Loans in the manner set forth in clause (d) below in an amount equal to the remainder (if positive) of (A) the Applicable Excess Cash Flow Percentage of Excess Cash Flow, if any, for such Excess Cash Flow Payment Period minus (B) the aggregate amount of voluntary prepayments of any Term Loan during such Excess Cash Flow Payment Period, in each case, solely to the extent that such prepayments were made in accordance with Section 2.12 and were not funded with the incurrence of any Funded Debt (other than revolving Funded Debt).

(c)       In the event that any Loan Party or any Restricted Subsidiary of a Loan Party shall receive Net Cash Proceeds from the issuance or incurrence of Indebtedness for money borrowed of any Loan Party or any Restricted Subsidiary of a Loan Party (other than any cash proceeds from the issuance of Indebtedness for money borrowed permitted pursuant to Section 6.01 (other than any Credit Agreement Refinancing Indebtedness)), the Lead Borrower shall, substantially simultaneously with (and in any event not later than the tenth Business Day next following) the receipt of such Net Cash Proceeds by such Loan Party or such subsidiary, apply an amount equal to 100% of such Net Cash Proceeds to prepay outstanding Loans in accordance with Section 2.13(d).

(d)       Mandatory prepayments of outstanding Loans under this Agreement shall be allocated (other than Net Cash Proceeds of any Credit Agreement Refinancing Indebtedness incurred pursuant to Section 2.25, which may, at the election of the Lead Borrower, be applied on a pro rata basis to any Class of outstanding Term Loans in respect of which such Indebtedness constitutes Credit Agreement Refinancing Indebtedness as directed by the Lead Borrower) by the Lead Borrower among each Class of outstanding Term Loans on a pro rata basis, with each Class to be allocated its Term Loan Percentage of the amount of the respective repayment and applied against the remaining scheduled installments of principal due in respect of the Term Loans to the outstanding principal amounts due under Sections 2.11(a)(i), (ii), (iii) and (iv) respectively as directed by the Lead Borrower (or in the absence of direction, in direct order of maturity), except to the extent the terms of any Incremental Term Loans, Other Term Loans, New Term Loans or Extended Term Loans provide for a less favorable treatment of any Incremental Term Loans, Other Term Loans, New Term Loans or Extended Term Loans with respect to any such mandatory prepayments.

(e)       Notwithstanding any other provisions of this Section 2.13, to the extent that any or all of the Net Cash Proceeds of any Disposition by a Foreign Subsidiary (a “Foreign Disposition”) or the Net Cash Proceeds of any Casualty Event from a Foreign Subsidiary (a “Foreign Casualty Event”), in each case giving rise to a prepayment event pursuant to Section 2.13(a), or Excess Cash Flow giving rise to a prepayment event pursuant to Section 2.13(b) are or is prohibited or delayed by applicable local law from being repatriated to the United States, the portion of such Net Cash Proceeds or Excess Cash Flow so affected will not be required to be applied to repay Term Loans at the times provided in this Section 2.13 but may be retained by the applicable Foreign Subsidiary so long, but only so long, as the applicable local law will not permit repatriation to the United States (the Lead Borrower hereby agreeing to cause the applicable Foreign Subsidiary to promptly take all actions reasonably required by the applicable local law to permit such repatriation), and once such repatriation of any of such affected Net Cash Proceeds or Excess Cash Flow is permitted under the applicable local law, such repatriation will be

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immediately effected and such repatriated Net Cash Proceeds or Excess Cash Flow will be promptly (and in any event not later than two (2) Business Days after such repatriation) applied (net of additional taxes payable or reserved against as a result thereof) to the repayment of the Loans pursuant to this Section 2.13 to the extent provided herein and (B) to the extent that the Lead Borrower has determined in good faith that repatriation of any of or all the Net Cash Proceeds of any Foreign Disposition, any Foreign Casualty Event or Excess Cash Flow would have a material adverse tax cost consequence (taking into account any foreign tax credit or benefit actually realized in connection with such repatriation) with respect to such Net Cash Proceeds or Excess Cash Flow, the Net Cash Proceeds or Excess Cash Flow so affected may be retained by the applicable Foreign Subsidiary, provided that, in the case of this clause (B), on or before the date on which any Net Cash Proceeds so retained would otherwise have been required to be applied to reinvestments or prepayments pursuant to this Section 2.13 (or such Excess Cash Flow would have been so required if it were Net Cash Proceeds), (x) the applicable Borrower applies an amount equal to such Net Cash Proceeds or Excess Cash Flow to such reinvestments or prepayments as if such Net Cash Proceeds or Excess Cash Flow had been received by the applicable Borrower rather than such Foreign Subsidiary, less the amount of additional taxes that would have been payable or reserved against if such Net Cash Proceeds or Excess Cash Flow had been repatriated (or, if less, the Net Cash Proceeds or Excess Cash Flow that would be calculated if received by such Foreign Subsidiary) or (y) such Net Cash Proceeds or Excess Cash Flow are applied to the repayment of Indebtedness of a Foreign Subsidiary.

 

(f)       The applicable Borrower shall deliver to the Administrative Agent, at the time of each prepayment required under this Section 2.13, (i) a certificate signed by a Financial Officer of the Lead Borrower setting forth in reasonable detail the calculation of the amount of such prepayment (the “Prepayment Amount”) and (ii) at least seven Business Days’ prior written notice of such prepayment. Each notice of prepayment shall specify the prepayment date (the “Prepayment Date”), the Type and Class of each Term Loan being prepaid and the principal amount of each Term Loan (or portion thereof) to be prepaid. All prepayments of Borrowings under this Section 2.13 shall be subject to Section 2.16 and Section 2.05(b), if applicable, but shall otherwise be without premium or penalty, and shall be accompanied by accrued and unpaid interest on the principal amount to be repaid to but excluding the date of payment.

(g)       Notwithstanding any other provisions of this Section 2.13, any Lender may (but solely to the extent the Lead Borrower elects for this clause (g) to be applicable to a given Prepayment Amount payable pursuant to Section 2.13(a)) decline to accept all (but not less than all) of its share of any such prepayment (any such Lender, a “Declining Lender”) by providing written notice to the Administrative Agent no later than five Business Days after the date of such Lender’s receipt of notice from the Administrative Agent regarding such prepayment. If any Lender does not give a notice to the Administrative Agent on or prior to such tenth Business Day informing the Administrative Agent that it declines to accept the applicable prepayment, then such Lender will be deemed to have accepted such prepayment. On any Prepayment Date, an amount equal to the Prepayment Amount minus the portion thereof allocable to Declining Lenders, in each case for such Prepayment Date, shall be paid to the Administrative Agent by the Borrowers and applied by the Administrative Agent ratably to prepay Term Loans owing to Lenders (other than Declining Lenders) in the manner described in Section 2.13(a) for such prepayment. Any amounts that would otherwise have been applied to prepay Term Loans owing to Declining Lenders shall be retained by the Borrowers (such amounts, “Declined Amounts”).

Section 2.14 Reserve Requirements; Change in Circumstances.

(a)       Notwithstanding any other provision of this Agreement, if any Change in Law shall impose, modify or deem applicable any reserve, special deposit or similar requirement against assets of, deposits with or for the account of or credit extended by any Lender (except any such reserve requirement which is reflected in the Adjusted LIBO Rate), shall subject any Lender to any additional Tax liability (other than in respect of Excluded Taxes or any Indemnified Taxes or Other Taxes indemnified under Section 2.20) or shall impose on such Lender or the London interbank market any other condition affecting this Agreement or Eurodollar Loans made by such Lender, and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurodollar Loan or increase the cost to any Lender or to reduce the amount of any sum received or receivable by such Lender hereunder (whether of principal, interest or otherwise) by an amount deemed by such Lender to be material, then the applicable Borrower will pay to such Lender upon demand such additional amount or amounts as will compensate such Lender for such additional costs incurred or reduction suffered.

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(b)       If any Lender shall have determined that any Change in Law regarding capital adequacy has or would have the effect of reducing the rate of return on such Lender’s capital or on the capital of such Lender’s holding company, if any, as a consequence of this Agreement or the Term Loans made pursuant hereto to a level below that which such Lender or such Lender’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s policies and the policies of such Lender’s holding company with respect to capital adequacy) by an amount deemed by such Lender to be material, then from time to time the applicable Borrower shall pay to such Lender such additional amount or amounts as will compensate such Lender or such Lender’s holding company for any such reduction suffered.

 

(c)       A certificate of a Lender setting forth the amount or amounts necessary to compensate such Lender or its holding company, as applicable, as specified in paragraph (a) or (b) above shall be delivered to the Lead Borrower and shall be conclusive absent manifest error. The applicable Borrower shall pay such Lender the amount shown as due on any such certificate delivered by it within 10 days after its receipt of the same.

(d)       Failure or delay on the part of any Lender to demand compensation for any increased costs or reduction in amounts received or receivable or reduction in return on capital shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrowers shall not be under any obligation to compensate any Lender under paragraph (a) or (b) above with respect to increased costs or reductions with respect to any period prior to the date that is 120 days prior to such request if such Lender knew or could reasonably have been expected to know of the circumstances giving rise to such increased costs or reductions and of the fact that such circumstances would result in a claim for increased compensation by reason of such increased costs or reductions; provided, further, that the foregoing limitation shall not apply to any increased costs or reductions arising out of the retroactive application of any Change in Law within such 120-day period. The protection of this Section 2.14 shall be available to each Lender regardless of any possible contention of the invalidity or inapplicability of the Change in Law that shall have occurred or been imposed.

Section 2.15 Change in Legality.

(a)       Notwithstanding any other provision of this Agreement, if any Change in Law shall make it unlawful for any Lender to make or maintain any Type of Eurodollar Loan or to give effect to its obligations as contemplated hereby with respect to any Type of Eurodollar Loan, then, by written notice to the Lead Borrower and to the Administrative Agent:

(i)       such Lender may declare that Eurodollar Loans will not thereafter (for the duration of such unlawfulness) be made by such Lender hereunder (or be continued for additional Interest Periods) and ABR Loans will not thereafter (for such duration) be converted into such Type of Eurodollar Loans, whereupon any request for such Type of a Eurodollar Borrowing (or to convert an ABR Borrowing to such Type of a Eurodollar Borrowing or to continue such Type of a Eurodollar Borrowing for an additional Interest Period) shall, as to such Lender only, be deemed a request for an ABR Loan (or a request to continue an ABR Loan as such for an additional Interest Period or to convert such Type of a Eurodollar Loan into an ABR Loan, as the case may be), unless such declaration shall be subsequently withdrawn; and

(ii)       such Lender may require that all outstanding Eurodollar Loans of such Type made by it be converted to ABR Loans, in which event all such Eurodollar Loans shall be automatically converted to ABR Loans as of the effective date of such notice as provided in paragraph (b) below.

In the event any Lender shall exercise its rights under (i) or (ii) above, all payments and prepayments of principal that would otherwise have been applied to repay the Eurodollar Loans of such Type that would have been made by such Lender or the converted Eurodollar Loans of such Type of such Lender shall instead be applied to repay the ABR Loans made by such Lender in lieu of, or resulting from the conversion of, such Eurodollar Loans of such Type.

(b)       For purposes of this Section 2.15, a notice to the Lead Borrower by any Lender shall be effective as to each Eurodollar Loan of such Type made by such Lender, if lawful, on the last day of the Interest Period then applicable to such Eurodollar Loan; in all other cases such notice shall be effective on the date of receipt by the applicable Borrower.

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Section 2.16 Breakage. The Borrowers shall indemnify each Lender against any loss (other than any lost profit or margin) or expense that such Lender may sustain or incur as a consequence of (a) any event, other than a default by such Lender in the performance of its obligations hereunder, which results in (i) such Lender receiving or being deemed to receive any amount on account of the principal of any Eurodollar Loan prior to the end of the Interest Period in effect therefor, (ii) the conversion of any Eurodollar Loan to an ABR Loan, or the conversion of the Interest Period with respect to any Eurodollar Loan, in each case other than on the last day of the Interest Period in effect therefor, or (iii) any Eurodollar Loan to be made by such Lender (including any Eurodollar Loan to be made pursuant to a conversion or continuation under Section 2.10) not being made after notice of a Borrowing Request to make such Term Loan or conversion notice to convert such Term Loan shall have been given by the Lead Borrower hereunder (any of the events referred to in this clause (a) being called a “Breakage Event”) or (b) any default in the making of any payment or prepayment required to be made hereunder. In the case of any Breakage Event, such loss shall include an amount equal to the excess, as reasonably determined by such Lender, of (i) its cost of obtaining funds for the Eurodollar Loan that is the subject of such Breakage Event for the period from the date of such Breakage Event to the last day of the Interest Period in effect (or that would have been in effect) for such Term Loan over (ii) the amount of interest likely to be realized by such Lender in redeploying the funds released or not utilized by reason of such Breakage Event for such period. A certificate of any Lender setting forth any amount or amounts which such Lender is entitled to receive pursuant to this Section 2.16 shall be delivered to the Lead Borrower and shall be conclusive absent manifest error.

 

Section 2.17 Pro Rata Treatment. Subject to Section 2.15, each Borrowing, each payment or prepayment of principal of any Borrowing made by or on behalf of a Borrower, each payment of interest on the Loans made by or on behalf of a Borrower, each reduction of the Commitments and each conversion of any Borrowing to or continuation of any Borrowing as a Borrowing of any Type shall be allocated pro rata among the applicable Lenders or such Class (it being understood that in the case of any such payment in respect of any Term B-1 Loans, such payments shall be applied on a pro rata basis to all Term B-1 Loans (including the Add-on Term B-1 Loans, on a pro rata basis) in accordance with their respective applicable Commitments (or, if such Commitments shall have expired or been terminated, in accordance with the respective principal amounts of their outstanding Loans). Each Lender agrees that in computing such Lenders portion of any Borrowing to be made hereunder, the Administrative Agent may, in its discretion, round each Lenders percentage of such Borrowing to the next higher or lower whole Dollar amount.

Section 2.18 Sharing of Setoffs. Each Lender agrees that if it shall, through the exercise of a right of banker’s lien, setoff or counterclaim against the Lead Borrower or any other Loan Party, or pursuant to a secured claim under Section 506 of Title 11 of the United States Code or other security or interest arising from, or in lieu of, such secured claim, received by such Lender under any applicable Debtor Relief Laws or otherwise, or by any other means, obtain payment (voluntary or involuntary) in respect of any Loans as a result of which the unpaid principal portion of its Loans of a Class to a Borrower shall be proportionately less than the unpaid principal portion of the Loans of that Class to such Borrower of any other Lender, it shall be deemed simultaneously to have purchased from such other Lender at face value, and shall promptly pay to such other Lender the purchase price for, a participation in such Loans of such other Lender, so that the aggregate unpaid principal amount of such Loans and participations in such Loans held by each applicable Lender shall be in the same proportion to the aggregate unpaid principal amount of all such Loans then outstanding as the principal amount of such Loans and participations in such Loans held by the Lender prior to such exercise of banker’s lien, setoff or counterclaim or other event was to the principal amount of all such Loans outstanding prior to such exercise of banker’s lien, setoff or counterclaim or other event; provided, however, that (i) if any such purchase or purchases or adjustments shall be made pursuant to this Section 2.18 and the payment giving rise thereto shall thereafter be recovered, such purchase or purchases or adjustments shall be rescinded to the extent of such recovery and the purchase price or prices or adjustment restored without interest, and (ii) the provisions of this Section 2.18 shall not be construed to apply to any payment made by a Borrower to a Lender in its capacity as such pursuant to and in accordance with the express terms of this Agreement or any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans to any assignee or participant. Each Borrower and Holdings expressly consents to the foregoing arrangements and agrees that any Lender holding a participation in a Loan deemed to have been so purchased may exercise any and all rights of banker’s lien, setoff or counterclaim with respect to any and all moneys owing by any Borrower and Holdings to such Lender by reason thereof as fully as if such Lender had made a Loan directly to the applicable Borrower in the amount of such participation.

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Section 2.19 Payments.

 

(a)       Each Borrower shall make each payment (including principal of or interest on any Borrowing or any Fees or other amounts) hereunder and under any other Loan Document not later than 2:00 p.m., New York City time, on the date when due in immediately available funds payable in Dollars without setoff, defense or counterclaim. Each such payment shall be made to the Administrative Agent at the Payment Office. The Administrative Agent shall promptly distribute to each Lender any payments received by the Administrative Agent on behalf of such Lender.

(b)       Except as otherwise expressly provided herein, whenever any payment (including principal of or interest on any Borrowing or any Fees or other amounts) hereunder or under any other Loan Document shall become due, or otherwise would occur, on a day that is not a Business Day, such payment may be made on the next succeeding Business Day, and such extension of time shall in such case be included in the computation of interest.

Section 2.20 Taxes.

(a)       Any and all payments by or on account of any obligation of each Borrower or any other Loan Party hereunder or under any other Loan Document shall be made free and clear of and without deduction for any Taxes unless required by applicable law; provided that, if an applicable withholding agent shall be required by applicable law to deduct any Taxes from such payments, then (i) if such Taxes are Indemnified Taxes or Other Taxes, the sum payable shall be increased by the applicable Borrower or other Loan Party as necessary so that after all required deductions (including deductions applicable to additional sums payable under this Section 2.20) have been made each Lender (or, where the Administrative Agent receives payment for its own account, the Administrative Agent) receives an amount equal to the sum it would have received had no such deductions been made, (ii) such withholding agent shall make such deductions and (iii) such withholding agent shall pay the full amount deducted to the relevant Governmental Authority in accordance with applicable law.

(b)       In addition, each Borrower (as applicable) shall pay any Other Taxes to the relevant Governmental Authority in accordance with applicable law.

(c)       Each Borrower shall indemnify the Administrative Agent and each Lender, within 10 days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes paid or payable by the Administrative Agent or such Lender, as the case may be, on or with respect to any payment by or on account of any obligation of such Borrower or in the case of the Lead Borrower, any other Loan Party, hereunder or under any other Loan Document (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section 2.20) and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to the Lead Borrower by a Lender, or by the Administrative Agent on behalf of itself or a Lender, shall be conclusive absent manifest error.

(d)       To the extent required by any applicable law, the Administrative Agent may withhold from any payment to any Lender an amount equivalent to any applicable withholding Tax. If the IRS or any other Governmental Authority asserts a claim that the Administrative Agent did not properly withhold Tax from amounts paid to or for the account of any Lender because the appropriate form was not delivered or was not properly executed or because such Lender failed to notify the Administrative Agent of a change in circumstance which rendered the exemption from, or reduction of, withholding Tax ineffective or for any other reason (including a Lender’s failure to comply with the provisions of Section 9.04(c) relating to the maintenance of a Participant Register), such Lender shall indemnify the Administrative Agent, within 10 days after demand therefor, fully for all amounts paid, directly or indirectly, by the Administrative Agent as tax or otherwise, including any penalties or interest and together with all expenses (including legal expenses, allocated internal costs and out-of-pocket expenses) incurred. A certificate as to the amount of such payment or liability delivered to any Lender by the Administrative Agent shall be conclusive absent manifest error. Each Lender hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender under any Loan Document or otherwise payable by the Administrative Agent to the Lender from any other source against any amount due to the Administrative Agent under this paragraph. For the avoidance of doubt, this Section 2.20(d) shall not expand or

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limit a Loan Party’s obligation to indemnify a Lender under Section 2.20(a) or (c). The agreements in this paragraph shall survive the resignation and/or replacement of the Administrative Agent, any assignment of rights by, or the replacement of, a Lender, the termination of the Commitments and the repayment, satisfaction or discharge of all other Obligations.

 

(e)       As soon as practicable after any payment of Indemnified Taxes or Other Taxes by any Borrower or any other Loan Party to a Governmental Authority, the Lead Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

(f)       (I) Any Lender that is entitled to an exemption from or reduction of any withholding tax under the law of the jurisdiction in which any Borrower is located, or any treaty to which such jurisdiction is a party, with respect to payments under this Agreement shall deliver to the Lead Borrower (with a copy to the Administrative Agent), at the time or times prescribed by applicable law, such properly completed and executed documentation prescribed by applicable law or reasonably requested by the Lead Borrower as will permit such payments to be made without withholding or at a reduced rate. Such Lender shall promptly notify the Lead Borrower at any time it determines that it is no longer in a position to provide any previously delivered documentation to the Lead Borrower. Notwithstanding anything to the contrary in the preceding sentence, the completion, execution and submission of such documentation (other than such documentation set forth in Section 2.20(f)(II) and 2.20(g) below) shall not be required if in the Lender’s reasonable judgment such completion, execution or submission would subject such Lender to any material unreimbursed cost or expense or would materially prejudice the legal or commercial position of such Lender.

(II)       Without limiting the generality of the foregoing, any Foreign Lender, to the extent it is legally entitled to do so, shall deliver to the Lead Borrower, Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter (i) if such Foreign Lender shall determine that any applicable form or certification has expired or will then expire or has or will then become obsolete or incorrect or that an event has occurred that requires or will then require a change in the most recent form or certification previously delivered by it to the Lead Borrower and the Administrative Agent and (ii) upon the request of the Lead Borrower or Administrative Agent, but only if such Foreign Lender is legally entitled to do so), whichever of the following is applicable:

(i)       duly completed copies of IRS Form W-8BEN-E or W-8BEN claiming eligibility for benefits of an income tax treaty to which the United States of America is a party;

(ii)       duly completed copies of IRS Form W-8ECI;

(iii)       in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 871(h) or 881(c) of the Code: (x) a certificate substantially in the form of Exhibit J (any such certificate, a “United States Tax Compliance Certificate”) to the effect that such Foreign Lender is not: (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code and (y) duly completed copies of IRS Form W-8BEN-E or W-8BEN;

(iv)       to the extent a Foreign Lender is not the beneficial owner (for example, where the Foreign Lender is a partnership or participating Lender granting a participation), duly completed copies of IRS Form W-8IMY accompanied by duly completed IRS Form W-8ECI, IRS Form W-8-BEN-E or W-8BEN, a United States Tax Compliance Certificate, IRS Form W-9 and/or other required documentation from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership (and not a participating Lender) and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest ex-emption, such Foreign Lender may provide a United States Tax Compliance Certificate on behalf of each such direct and indirect partner; and

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(v)       any other form prescribed by applicable law as a basis for claiming exemption from or a reduction of United States federal withholding Tax duly completed together with such supplementary documentation as may be prescribed by applicable law to permit the Borrower to determine the withholding or deduction required to be made.

 

(g)       If a payment made to a Lender under any Loan Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall deliver to the Lead Borrower and the Administrative Agent at the time or times prescribed by law and at such time or times reasonably requested by the Lead Borrower or the Administrative Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Lead Borrower or the Administrative Agent as may be necessary for each Borrower and the Administrative Agent to comply with their obligations under FATCA and to determine whether such Lender has complied with such Lender’s obligations under FATCA or to determine the amount, if any, to deduct and withhold from such payment. Solely for purposes of this clause (g), “FATCA” shall include any amendments made to FATCA after the date of this Agreement.

(h)       Each Lender hereby authorizes the Administrative Agent to deliver to the Loan Parties and to any successor Administrative Agent any documentation provided by such Lender to the Administrative Agent pursuant to Section 2.20(f) or (g).

(i)       If a Lender or the Administrative Agent determines, in its sole discretion, that it has received a refund in respect of any Indemnified Taxes or Other Taxes as to which it has been indemnified by any Borrower or with respect to which any Borrower or other Loan Party has paid additional amounts pursuant to this Section 2.20, it shall pay over the amount of such refund to such Borrower or other Loan Party, as applicable (but only to the extent of indemnity payments made under this Section 2.20 with respect to the Indemnified Taxes or Other Taxes, as the case may be, giving rise to such refund), net of all out-of-pocket expenses (including any Taxes imposed with respect to such refund) of such Lender or the Administrative Agent and without interest (other than interest paid by the relevant taxation authority with respect to such refund); provided that such Borrower or other Loan Party, upon the request of such Lender or the Administrative Agent, agrees to repay the amount paid over to such Borrower or other Loan Party (plus penalties, interest or other charges) to such Lender or the Administrative Agent in the event such Lender or the Administrative Agent is required to repay such refund to such taxation authority. Notwithstanding anything to the contrary in this paragraph (i), in no event will the Lender or Administrative Agent be required to pay any amount pursuant to this paragraph (i) the payment of which would place the Lender or Administrative Agent in a less favorable net after-Tax position than such Lender or Administrative Agent would have been in if the Tax subject to indemnification and giving rise to such refund had not been deducted, withheld or otherwise imposed and the indemnification payments or additional amounts with respect to such Tax had never been paid. This subsection shall not be construed to require such Lender or the Administrative Agent to make available its tax returns (or any other information relating to its Taxes that it deems confidential) to the Borrowers or any other Person.

Section 2.21 Assignment of Commitments under Certain Circumstances; Duty to Mitigate.

(a)       In the event (i) any Lender delivers a certificate requesting compensation pursuant to Section 2.14, (ii) any Lender delivers a notice described in Section 2.15, (iii) any Borrower is required to pay any additional amount to any Lender or any Governmental Authority on account of any Lender pursuant to Section 2.20 or (iv) any Lender refuses to consent to any amendment, waiver or other modification of any Loan Document requested by the Lead Borrower that requires the consent of a greater percentage of the Lenders than the Required Lenders and such amendment, waiver or other modification is consented to by the Required Lenders, then, in each case, the Lead Borrower may, at its sole expense and effort (including with respect to the processing and recordation fee referred to in Section 9.04(b)), upon notice to such Lender and the Administrative Agent, require such Lender to transfer and assign, without recourse (in accordance with and subject to the restrictions contained in Section 9.04), all of its interests, rights and obligations under this Agreement (or, in the case of clause (iv) above, all of its interests, rights and obligation with respect to the Class of Term Loans or Commitments that is the subject of the related consent, amendment, waiver or other modification) to an Eligible Assignee that shall assume such assigned obligations and, with respect to clause (iv) above, shall consent to such requested amendment, waiver or other modification of any

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Loan Documents (which assignee may be another Lender, if a Lender accepts such assignment); provided that (x) such assignment shall not conflict with any law, rule or regulation or order of any court or other Governmental Authority having jurisdiction, (y) the Lead Borrower shall have received the prior written consent of the Administrative Agent, which consent shall not unreasonably be withheld or delayed, and (z) the Lead Borrower or such assignee shall have paid to the affected Lender in immediately available funds an amount equal to the sum of the principal of and interest accrued to the date of such payment on the outstanding Loans of such Lender, plus all amounts accrued for the account of such Lender hereunder with respect thereto (including any amounts under Sections 2.05(b), 2.14, 2.16 and 2.20); provided further that, if prior to any such transfer and assignment the circumstances or event that resulted in such Lender’s claim for compensation under Section 2.14, notice under Section 2.15 or the amounts paid pursuant to Section 2.20, as the case may be, cease to cause such Lender to suffer increased costs or reductions in amounts received or receivable or reduction in return on capital, or cease to have the consequences specified in Section 2.15, or cease to result in amounts being payable under Section 2.20, as the case may be (including as a result of any action taken by such Lender pursuant to paragraph (b) below), or if such Lender shall waive its right to claim further compensation under Section 2.14 in respect of such circumstances or event or shall withdraw its notice under Section 2.15 or shall waive its right to further payments under Section 2.20 in respect of such circumstances or event or shall consent to the proposed amendment, waiver, consent or other modification, as the case may be, then such Lender shall not thereafter be required to make any such transfer and assignment hereunder. Each Lender hereby grants to the Administrative Agent an irrevocable power of attorney (which power is coupled with an interest) to execute and deliver, on behalf of such Lender, as assignor, any Assignment and Acceptance necessary to effectuate any assignment of such Lender’s interests hereunder in the circumstances contemplated by this Section 2.21(a).

 

(b)       If (i) any Lender shall request compensation under Section 2.14 or Section 2.20 or (ii) any Lender delivers a notice described in Section 2.15, then such Lender shall use reasonable efforts (which shall not require such Lender to incur an unreimbursed loss or unreimbursed cost or expense or otherwise take any action inconsistent with its internal policies or legal or regulatory restrictions or suffer any disadvantage or burden deemed by it to be significant) (x) to file any certificate or document reasonably requested in writing by the Lead Borrower or (y) to assign its rights and delegate and transfer its obligations hereunder to another of its offices, branches or affiliates, if such filing or assignment would reduce its claims for compensation under Section 2.14 or Section 2.20 or enable it to withdraw its notice pursuant to Section 2.15, as the case may be, in the future. Each Borrower hereby agrees to pay or cause to be paid all reasonable costs and expenses incurred by any Lender in connection with any such filing or assignment, delegation and transfer.

Section 2.22 Incremental Term Loans and Incremental Revolving Facilities.

(a)       The Lead Borrower may, by written notice to the Administrative Agent from time to time, request that one or more Lenders (each of which shall be entitled to agree or decline to participate in its sole discretion) and/or one or more other Persons which are Eligible Assignees and which will become Lenders, provide, after the Closing Date, an increase in any existing Class of Term Loans (except as otherwise provided in this Section 2.22, which shall be on the same terms as, and become a part of, the applicable Class of Term Loans hereunder) and, subject to the terms and conditions contained in this Agreement and in the respective Incremental Term Loan Assumption Agreement, make Term Loans (“Incremental Term Loans”) of the applicable class pursuant thereto. Such notice shall set forth (i) the amount of the Incremental Term Loan Commitments being requested (which shall be in minimum increments of $1,000,000 and a minimum amount of $5,000,000 (or such lesser amount as may be acceptable to the Administrative Agent) and (ii) the date on which such Incremental Term Loan Commitments are requested to become effective; provided that:

(i)       no Lender shall be obligated to provide an Incremental Term Loan Commitment as a result of any such request by the Lead Borrower, and until such time, if any, as such Lender has agreed in its sole discretion to provide an Incremental Term Loan Commitment and executed and delivered to the Administrative Agent an Incremental Term Loan Assumption Agreement as provided in clause (b) of this Section 2.22, such Lender shall not be obligated to fund any Incremental Term Loans,

(ii)       any Lender (including any Eligible Assignee who will become a Lender) may so provide an Incremental Term Loan Commitment without the consent of any other Lender,

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(iii)       any Affiliated Lender may provide an Incremental Term Loan Commitment; provided, that such Incremental Term Loan Commitment shall be subject to the applicable restrictions in Section 9.04(f);

 

(iv)       the aggregate principal amount of all Incremental Term Loans pursuant to this Section 2.22 at any time (including the Add-on Term B-1 Loans funded on the Amendment No. 3 Effective Date) shall not exceed the Maximum Incremental Amount at such time;

(v)       the up-front fees and, if applicable, any unutilized commitment fees and/or other fees, payable to each Incremental Term Loan Lender in respect of each Incremental Term Loan Commitment shall be separately agreed to by the Lead Borrower and each such Incremental Term Loan Lender;

(vi)        the new Incremental Term Loans shall have the same Applicable Margin as the Class of Term Loans to which such Incremental Term Loans are being added,

(vii)       the new Incremental Term Loans shall have the same repayment dates as then remain with respect to the Class of Term Loans to which such new Incremental Term Loans are being added (with the amount of each repayment of Incremental Term Loans to be made by the Lead Borrower on the repayment dates to be the same (on a proportionate basis) as is theretofore applicable to the Class of Term Loans to which such Incremental Term Loans are being added, thereby increasing the amount of each then remaining repayment of the respective Class of Term Loans proportionately),

(viii)       the new Incremental Term Loans shall have the same Maturity Date as the Class of Term Loans to which such Incremental Term Loans are being added,

(ix)       the proceeds of all Incremental Term Loans to be made pursuant to any Incremental Term Loan Commitments shall be used only for the purposes permitted by Section 3.13,

(x)       all Incremental Term Loans shall be Obligations under this Agreement and the other applicable Loan Documents and shall be secured by the Security Documents, and guaranteed under the Guaranty, and rank pari passu in right of payment and pari passu in right of security in respect of the Collateral with the Term Loans, and

(xi)       except as otherwise provided above, such Incremental Term Loans shall have the same terms as the Class of Term Loans to which such Incremental Term Loans are being added.

(b)       At the time of the provision of the Incremental Term Loan Commitments pursuant to this Section 2.22, the Lead Borrower, the Administrative Agent and each such Lender or other Eligible Assignee which agrees to provide an Incremental Term Loan Commitment (each, an “Incremental Term Lender”) shall execute and deliver to the Administrative Agent an Incremental Term Loan Assumption Agreement and such other documentation as the Administrative Agent shall reasonably specify to evidence the Incremental Term Loan Commitment of each Incremental Term Lender. Notwithstanding the foregoing, no Incremental Term Loan Commitment shall become effective under this Section 2.22 unless on the date of such effectiveness, all Incremental Commitment Requirements are satisfied.

(c)       The Administrative Agent shall promptly notify each Lender as to the effectiveness of each Incremental Term Loan Assumption Agreement. Each of the parties hereto hereby agrees that, upon the effectiveness of any Incremental Term Loan Assumption Agreement, this Agreement shall be deemed amended to the extent (but only to the extent) necessary to reflect the existence and terms of the Incremental Term Loan Commitment and the Incremental Term Loans evidenced thereby, and the Administrative Agent and the Lead Borrower may revise this Agreement to evidence such amendments.

(d)       Each of the parties hereto hereby agrees that the Administrative Agent may, in consultation with the Lead Borrower, take any and all action as may be reasonably necessary to ensure that all Incremental Term Loans, when originally made, are included in each Borrowing of outstanding Term Loans on a pro rata basis. This

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may be accomplished by requiring each outstanding Eurodollar Borrowing to be converted into an ABR Borrowing on the date of each Incremental Term Loan, or by allocating a portion of each Incremental Term Loan to each outstanding Eurodollar Borrowing on a pro rata basis. Any conversion of Eurodollar Loans to ABR Loans required by the preceding sentence shall be subject to Section 2.16. If any Incremental Term Loan is to be allocated to an existing Interest Period for a Eurodollar Borrowing, then the interest rate thereon for such Interest Period and the other economic consequences thereof shall be as set forth in the applicable Incremental Term Loan Assumption Agreement. In addition the scheduled amortization payments under Sections 2.11(a)(i), (ii), (iii) and (iv), as applicable, required to be made after the making of such Incremental Term Loans shall be ratably increased by the aggregate principal amount of such Incremental Term Loans and shall be further increased for all Lenders on a pro rata basis to the extent necessary to avoid any reduction in the amortization payments to which the Lenders were entitled before such recalculation.

 

(e)       Notwithstanding anything to the contrary in this Agreement, at any time after the Amendment No. 2 Effective Date, subject to terms and conditions set forth herein, the Lead Borrower may, by notice the Administrative Agent request to effect one or more revolving credit facilities tranches (“Incremental Revolving Facilities”) in an aggregate committed amount not to exceed $30,000,000 at any time outstanding; provided that any such Incremental Revolving Facilities shall be secured on a pari passu basis by the Collateral securing the Loans; provided further that such Incremental Revolving Facilities shall be on terms and conditions as separately agreed to by the Lead Borrower and each such lender of the Incremental Revolving Facilities (including the addition of any financial covenants and related definitions solely for the benefit of, and as may be amended solely by, the lenders (or such subset of them as may be agreed) of the Incremental Revolving Facilities) and such terms and conditions shall be reasonably satisfactory to the Administrative Agent. The Administrative Agent and the Lenders hereby agree that this Agreement may be amended to effectuate the addition of any such Incremental Revolving Facilities. As of the Amendment No. 3 Effective Date after giving effect to the effectiveness of the Revolving Commitments on such date, the available basket for Incremental Revolving Facilities is $0.

(f)       This Section 2.22 shall supersede any provision in Section 2.17 or Section 9.08 to the contrary.

Section 2.23 New Term Loan Facility.

(a)       The Lead Borrower shall have the right to request (by written notice to the Administrative Agent), at any time after the Closing Date, that one or more Lenders (and/or one or more other Persons which are Eligible Assignees and which will become Lenders) provide New Term Loan Commitments to the Lead Borrower and, subject to the terms and conditions contained in this Agreement and in the respective New Term Loan Commitment Agreement, make Term Loans (“New Term Loans”) pursuant thereto; it being understood and agreed, however, that:

(i)       no Lender shall be obligated to provide a New Term Loan Commitment as a result of any such request by the Lead Borrower, and until such time, if any, as such Lender has agreed in its sole discretion to provide a New Term Loan Commitment and executed and delivered to the Administrative Agent and the Lead Borrower a New Term Loan Commitment Agreement as provided in clause (b) of this Section 2.23, such Lender shall not be obligated to fund any New Term Loans;

(ii)       any Lender (including any Eligible Assignees who will become a Lender) may so provide a New Term Loan Commitment without the consent of any other Lender;

(iii)       any Affiliated Lender may provide a New Term Loan Commitment; provided that such New Term Loan Commitment shall be subject to the applicable restrictions in Section 9.04(f);

(iv)       each Class of New Term Loan Commitments, and all New Term Loans to be made pursuant thereto, shall be denominated in Dollars;

(v)       the amount of each Class of New Term Loan Commitments shall be in a minimum aggregate amount for all Lenders which provide a New Term Loan Commitment under such Class of New Term Loans (including Eligible Assignees who will become Lenders) of at least $25,000,000 (or such

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lower amount as may be reasonably acceptable to the Administrative Agent) and in integral multiples of $1,000,000 in excess thereof (or such other integral multiple as may be reasonably acceptable to the Administrative Agent);

 

(vi)       the aggregate amount of all New Term Loan Commitments provided pursuant to this Section 2.23 and the aggregate principal amount of all New Term Loans to be made pursuant thereto shall not exceed the Maximum Incremental Amount at such time;

(vii)       the up-front fees and, if applicable, any unutilized commitment fees and/or other fees, payable to each New Term Loan Lender in respect of each New Term Loan Commitment shall be separately agreed to by the Lead Borrower and each such New Term Loan Lender;

(viii)       each Class of New Term Loans shall (A) have a Maturity Date of no earlier than the day after the Latest Maturity Date of any Class of Term Loans then existing, (B) have a Weighted Average Life to Maturity of no less than the Weighted Average Life to Maturity as then in effect for any Class of Term Loans then existing and (C) be subject to the Applicable Margins as are set forth in the New Term Loan Commitment Agreement governing such Class of New Term Loans; provided that, if the Effective Yield for any such Class of New Term Loans, determined as of the initial funding date for such Class of New Term Loans, exceeds the Effective Yield relating to any Class of Term Loans existing immediately prior to the effectiveness of the respective New Term Loan Commitment Agreement by more than 0.50%, then the Effective Yield relating to any such Class of Term Loans thereto incurred shall be adjusted to be equal to the Effective Yield (determined as provided above) relating to such Class of New Term Loans minus 0.50%;

(ix)       the proceeds of all New Term Loans shall be used only for the purposes permitted by Section 3.13;

(x)       each New Term Loan Commitment Agreement shall specifically designate the Class or Classes of the New Term Loan Commitments being provided thereunder (which Class shall be a new Class (i.e., not the same as the Term B-1 Loans or any other then existing Class of Term Loans) unless the New Term Loans would be fungible with an existent Class for U.S. federal income tax purposes);

(xi)       all New Term Loans (and all interest, fees and other amounts payable thereon) shall be Obligations under this Agreement and the other applicable Loan Documents and shall be secured by the Security Documents, and guaranteed under the Guaranty, on a pari passu basis with all other Obligations secured by the Security Documents and guaranteed under the Guaranty;

(xii)       each Lender (including any Eligible Assignee who will become a Lender) agreeing to provide a New Term Loan Commitment pursuant to a New Term Loan Commitment Agreement shall, subject to the satisfaction of the relevant conditions set forth in this Agreement, make New Term Loans as specified in such New Term Loan Commitment Agreement and such New Term Loans shall thereafter be deemed to be New Term Loans under such Class for all purposes of this Agreement and the other applicable Loan Documents;

(xiii)       except as otherwise set forth in this Section 2.23(n) or otherwise as shall be reasonably satisfactory to the Administrative Agent and the Borrower, such New Term Loan Facility shall have the same terms as the Term B-1 Loan Facility; and

(xiv)       each New Term Loan Facility shall share ratably in any prepayments of Term Loans (unless such New Term Loan Facility agrees to participate on a less than pro rata basis in any voluntary or mandatory prepayments or repayments).

(b)       At the time of the provision of New Term Loan Commitments pursuant to this Section 2.23, the Lead Borrower, the Administrative Agent and each such Lender or other Eligible Assignee which agrees to provide a New Term Loan Commitment (each, a “New Term Loan Lender”) shall execute and deliver to the Administrative

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Agent a New Term Loan Commitment Agreement, with the effectiveness of the New Term Loan Commitment provided therein (and the making of the respective New Term Loans thereunder) to occur on the date set forth in such New Term Loan Commitment Agreement, which date in any event shall be no earlier than the date on which (w) all fees required to be paid in connection therewith at the time of such effectiveness shall have been paid (including, without limitation, any agreed upon up-front or arrangement fees owing to the Administrative Agent (or any affiliate thereof)), (x) all Incremental Commitment Requirements are satisfied, (y) all other conditions set forth in this Section 2.23 shall have been satisfied (or waived in writing by the Required Lenders prior to the incurrence of such New Term Loan Commitments), and (z) all other conditions precedent that may be set forth in such New Term Loan Commitment Agreement shall have been satisfied (or waived in writing by the Lenders providing such New Term Loan Commitments). The Administrative Agent shall promptly notify each Lender as to the effectiveness of each New Term Loan Commitment Agreement, and at such time, to the extent requested by any New Term Loan Lender, new Term Notes will be issued, at the Lead Borrower’s expense, to such New Term Loan Lender in conformity with the requirements of this Agreement.

 

(c)       Notwithstanding anything to the contrary contained above in this Section 2.23, the New Term Loan Commitments provided by a New Term Loan Lender or New Term Loan Lenders, as the case may be, pursuant to each New Term Loan Commitment Agreement shall constitute a new Class, which shall be separate and distinct from the existing Classes pursuant to this Agreement (with a designation which may be made in letters (i.e., A, B, C, etc.), numbers (1, 2, 3, etc.) or a combination thereof (i.e., A-1, A-2, A-3, B-1, B-2, B-3, C-1, C-2, C-3, etc.).

The New Term Loan Commitment Agreement may, with the consent of the Lead Borrower and the Administrative Agent, but without the consent of any other Loan Party or the Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Lead Borrower, to effect the provisions of this Section 2.23.

Section 2.24 New Incremental Notes.

(a)       The Lead Borrower shall have the right, at any time after the Closing Date, upon written notice to the Administrative Agent, specifying in reasonable detail the proposed terms thereof, to issue one or more series of senior secured notes (secured by the Collateral on an equal and ratable basis with the Obligations (or secured by the Collateral on a second lien basis)) or unsecured notes (such notes, collectively, “New Incremental Notes”); it being understood and agreed, however, that:

(i)       the aggregate amount of all New Incremental Notes permitted to be issued pursuant to this Section 2.24 shall not exceed the Maximum Incremental Amount at such time;

(ii)       all Incremental Commitment Requirements must be satisfied on the date of issuance of any New Incremental Notes;

(iii)       such New Incremental Notes shall (A) have a Maturity Date of no earlier than 91 days after the Latest Maturity Date applicable to any Class of Term Loans then outstanding, (B) have a Weighted Average Life to Maturity of no less than the Weighted Average Life to Maturity as then in effect for any Class of Loans then existing, and (C) not be subject to any amortization prior to the final maturity thereof, or be subject to any mandatory redemption or prepayment provisions or rights (except (1) customary assets sale or change of control provisions or (2) to the extent that prepayments are made, to the extent required under the Loan Documents, first pro rata to any then existing Class of Term Loan and any senior secured first lien New Incremental Notes);

(iv)       such New Incremental Notes shall rank pari passu in right of payment (subject to the applicable provisions of the intercreditor agreement referred to in clause (f) in the case of secured New Incremental Notes), have the same guarantees as the Term Loan Facilities and, if secured, be secured solely by the Collateral;

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(v)       any such secured New Incremental Notes shall be issued subject to intercreditor arrangements that are reasonably satisfactory to the Administrative Agent and;

 

(vi)       the terms and conditions of such New Incremental Notes are customary for similar debt securities in light of then-prevailing market conditions at the time of issuance and in any event are not, taken as a whole, more restrictive to the Lead Borrower and its Restricted Subsidiaries than those set forth in this Agreement (other than with respect to interest rate and redemption provisions), except for covenants and other provisions applicable only to periods after the Latest Maturity Date of any then existing Term Loan Facility that remains outstanding after giving effect to such refinancing (provided that a certificate of a financial officer of the Lead Borrower delivered to the Administrative Agent in good faith at least five (5) Business Days prior to the incurrence of such New Incremental Notes, together with a reasonably detailed description of the material terms and conditions of such New Incremental Notes or drafts of the documentation relating thereto, stating that the Lead Borrower has determined in good faith that such terms and conditions satisfy the requirement set forth in this Section 2.24, shall be conclusive evidence that such terms and conditions satisfy such requirement unless the Administrative Agent provides notice to the Lead Borrower of its objection during such five (5) Business Day period (including a reasonable description of the basis upon which it objects)).

Section 2.25 Extensions of Term Loans.

(a)       Notwithstanding anything to the contrary in this Agreement, pursuant to one or more offers (each, an “Extension Offer”) made from time to time by the applicable Borrower to all Lenders of Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans, in each case of any Class and on a pro rata basis (based on the aggregate outstanding principal amount of the respective Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans, as the case may be, with a like Maturity Date) and on the same terms to each such Lender, such Borrower is hereby permitted to consummate from time to time transactions with individual Lenders that accept the terms contained in such Extension Offers to extend the maturity date of each such Lender’s Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans with a like Maturity Date and otherwise modify the terms of such Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans pursuant to the terms of the relevant Extension Offer (including, without limitation, by increasing the interest rate or fees payable in respect of such Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans and/or modifying the amortization schedule in respect of such Lender’s Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans with a like Maturity Date) (each, an “Extension,” and each group of Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans as so extended, as well as the original Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans (in each case not so extended), being a “tranche”; any Extended Term Loans shall constitute a separate tranche of Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans from the tranche of Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans with a like Maturity Date from which they were converted), so long as the following terms are satisfied: (i) no Default or Event of Default shall have occurred and be continuing at the time the offering document in respect of an Extension Offer is delivered to the Lenders; (ii) except as to interest rates, fees, amortization, final maturity date, premium, required prepayment dates and participation in prepayments (which shall, subject to immediately succeeding clauses (iii), (iv) and (v), be determined by the applicable Borrower and the Extending Term Loan Lenders and set forth in the relevant Extension Offer), the Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans of any Term Loan Lender that agrees to an Extension with respect to such Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans with a like Maturity Date (an “Extending Term Loan Lender”) extended pursuant to any Extension (“Extended Term Loans”); (iii) the final maturity date of any Extended Term Loans shall be no earlier than the then Latest Maturity Date hereunder; (iv) the Weighted Average Life to Maturity of any Extended Term Loans shall be no shorter than the remaining Weighted Average Life to Maturity of the Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans extended thereby; (v) any Extended Term Loans may participate on a pro rata basis or a less than pro rata basis (but not greater than a pro rata basis) in any voluntary or mandatory repayments or prepayments hereunder, in each case as specified in the respective Extension Offer; (vi) if the aggregate principal amount of Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans (calculated on the face amount thereof), as the case may be, in respect of which Lenders shall have accepted the relevant Extension Offer shall exceed the maximum aggregate principal amount of Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans, as the case may be, offered to be extended by the applicable Borrower pursuant

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to such Extension Offer, then the Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans, as the case may be, of such Lenders shall be extended ratably up to such maximum amount based on the respective principal amounts (but not to exceed actual holdings of record) with respect to which such Lenders have accepted such Extension Offer; (vii) all documentation in respect of such Extension shall be consistent with the foregoing; (viii) any applicable Minimum Extension Condition shall be satisfied unless waived by the applicable Borrower and (ix) any Extended Term Loans shall be denominated in the same currency as the Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans extended thereby.

 

(b)       With respect to all Extensions consummated by a Borrower pursuant to this Section 2.25, (i) such Extensions shall not constitute voluntary or mandatory payments or prepayments for purposes of Sections 2.12 and 2.13 and (ii) no Extension Offer is required to be in any minimum amount or any minimum increment, provided that such Borrower may at its election specify as a condition (a “Minimum Extension Condition”) to consummating any such Extension that a minimum amount (to be determined and specified in the relevant Extension Offer in such Borrower’s sole discretion and may be waived by such Borrower) of Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans (as applicable) of any or all applicable tranches be tendered. The Administrative Agent and the Lenders hereby consent to the Extensions and the other transactions contemplated by this Section 2.25 (including, for the avoidance of doubt, payment of any interest, fees or premium in respect of any Extended Term Loans on the same terms as may be set forth in the relevant Extension Offer) and hereby waive the requirements of any provision of this Agreement (including, without limitation, Sections 2.18 and 7.02) or any other Loan Document that may otherwise prohibit any such Extension or any other transaction contemplated by this Section 2.25.

(c)       No consent of any Lender or the Administrative Agent shall be required to effectuate any Extensions, other than the consent of each Lender agreeing to such Extension with respect to one or more of its Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans, as the case may be (or a portion thereof). All Extended Term Loans incurred by the Lead Borrower and all obligations in respect thereof shall be Obligations under this Agreement and the other Loan Documents that are secured by the Collateral on a pari passu basis with all other applicable Obligations under this Agreement and the other Loan Documents. Without limiting the foregoing, in connection with any Extension, the Loan Parties shall (at their expense) amend (and the Administrative Agent is hereby directed to amend) any Mortgage that has a maturity date prior to the then Latest Maturity Date so that such maturity date is extended to the then Latest Maturity Date (or such later date as may be advised by local counsel to the Administrative Agent).

(d)       In connection with any Extension, the Lead Borrower shall provide the Administrative Agent at least five (5) Business Days’ (or such shorter period as may be agreed by the Administrative Agent) prior written notice thereof, and shall agree to such procedures (including, without limitation, rendering timing, rounding and other adjustments and to ensure reasonable administrative management of the credit facilities hereunder after such Extension), if any, as may be established by, or acceptable to, the Administrative Agent, in each case acting reasonably to accomplish the purposes of this Section 2.25.

(e)       In the event that the Administrative Agent determines in its sole discretion that the allocation of Extended Term Loans of a given tranche of Extended Term Loans to a given Lender was incorrectly determined as a result of manifest administrative error in the receipt and processing of an election by such Lender to extend all or a portion of its Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans, as the case may be, timely submitted by such Lender in accordance with the procedures set forth in the applicable documentation governing such Extension, then the Administrative Agent, the applicable Borrower and such affected Lender may (and hereby are authorized to), in their sole discretion and without the consent of any other Lender, enter into an amendment to this Agreement and the other Loan Documents (each, a “Corrective Term Loan Extension Amendment”) within 15 days following the effective date of such Extension, which Corrective Term Loan Extension Amendment shall (i) provide for the conversion and extension of Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans, as the case may be, under the applicable tranche of Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans in such amount as is required to cause such Lender to hold Extended Term Loans of the applicable tranche of Term B-1 Loans Incremental Term Loans, New Term Loans or Other Term Loans into which such other Term B-1 Loans, Incremental Term Loans, New Term Loans or Other Term Loans were initially converted, in the amount such Lender would have held had such administrative error not occurred and had such Lender received the minimum allocation of the applicable Extended Term Loans to

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which it was entitled under the terms of such Extension in the absence of such error, (ii) be subject to the satisfaction of such conditions as the Administrative Agent, the applicable Borrower and such Lender may agree, and (iii) effect such other amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Lead Borrower, to effect the provisions of this Section 2.25.

 

Section 2.26 Refinancing Amendments.

(a)       At any time after the Closing Date, the Lead Borrower may obtain, from any Lender or any additional Eligible Assignee, Credit Agreement Refinancing Indebtedness in respect of all or any portion of the Term B-1 Loans, Incremental Term Loans or New Term Loans then outstanding under this Agreement (which for purposes of this clause (a) will be deemed to include any then outstanding Other Term Loans or Other Term Loan Commitments), in the form of Other Term Loans or Other Term Loan Commitments; provided that such Credit Agreement Refinancing Indebtedness (i) incurred by the Lead Borrower will rank pari passu in right of payment and of security with the other Term Loans hereunder, (ii) will have such pricing, fees, premiums, interest or optional prepayment or redemption terms as may be agreed by the applicable Borrower and the Lenders thereof, (iii) any Credit Agreement Refinancing Indebtedness in the form of Other Term Loans or Other Term Loan Commitments shall share ratably in any prepayments of Term B-1 Loans, Incremental Term Loans or New Term Loans, as the case may be (unless the Other Term Loans agree to participate on a less than pro rata basis in any voluntary or mandatory prepayments or repayments) and (iv) will have terms and conditions that are substantially identical to, or (taken as a whole) less favorable to the investors providing such Credit Agreement Refinancing Indebtedness than, the Refinanced Debt; provided further that the terms and conditions applicable to such Credit Agreement Refinancing Indebtedness may provide for any additional or different financial or other covenants or other provisions that are agreed between the applicable Borrower and the Lenders thereof and applicable only during periods after the Latest Maturity Date that is in effect on the date such Credit Agreement Refinancing Indebtedness is issued, incurred or obtained. Each Class of Credit Agreement Refinancing Indebtedness incurred under this Section 2.26 shall be in an aggregate principal amount that is (x) not less than $10,000,000 in the case of Other Term Loans and (y) an integral multiple of $1,000,000 in excess thereof. The effectiveness of any Refinancing Amendment shall be subject to the satisfaction on the date thereof of each of the conditions set forth in Section 4.01 and, to the extent reasonably requested by the Administrative Agent, receipt by the Administrative Agent of (i) legal opinions, board resolutions and officers’ certificates consistent with those delivered on the Closing Date other than changes to such legal opinion resulting from a change in law, change in fact or change to counsel’s form of opinion reasonably satisfactory to the Administrative Agent and (ii) reaffirmation agreements and/or such amendments to the Security Documents as may be reasonably requested by the Administrative Agent (including amendments to the Mortgages) in order to ensure that the Credit Agreement Refinancing Indebtedness is provided with the benefit of the applicable Loan Documents.

(b)       The Administrative Agent shall promptly notify each Lender as to the effectiveness of each Refinancing Amendment. Each of the parties hereto hereby agrees that, upon the effectiveness of any Refinancing Amendment, this Agreement shall be deemed amended to the extent (but only to the extent) necessary to reflect the existence and terms of the Credit Agreement Refinancing Indebtedness incurred pursuant thereto (including any amendments necessary to treat the Loans and Commitments subject thereto as Other Term Loans and/or Other Term Loan Commitments). Any Refinancing Amendment may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the reasonable opinion of the Administrative Agent and the Lead Borrower, to effect the provisions of this Section 2.26.

Section 2.27 Lead Borrower. Each Borrower hereby designates the Lead Borrower as its representative and agent for all purposes under the Loan Documents, including designation of interest rates, delivery or receipt of communications, preparation and delivery of financial reports, receipt and payment of Obligations, requests for waivers, amendments or other accommodations, actions under the Loan Documents (including in respect of compliance with covenants), and all other dealings with the Administrative Agent or any Lender. The Lead Borrower hereby accepts such appointment. The Administrative Agent and the Lenders shall be entitled to rely upon, and shall be fully protected in relying upon, any notice or communication delivered by the Lead Borrower on behalf of any Borrower. The Administrative Agent and the Lenders may give any notice or communication with a Borrower hereunder to the Lead Borrower on behalf of such Borrower. Each of the Administrative Agent and the Lenders shall have the right, in its discretion, to deal exclusively with the Lead Borrower for any or all purposes

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under the Loan Documents. Each Borrower agrees that any notice, election, communication, representation, agreement or undertaking made on its behalf by the Lead Borrower shall be binding upon and enforceable against it.

 

ARTICLE III

 


Representations and Warranties

Each of Holdings and each Borrower represents and warrants to the Administrative Agent and each of the Lenders with respect to itself and its Restricted Subsidiaries, that on and as of the Closing Date and as of the date of each Borrowing hereunder (other than a continuation or conversion of a Borrowing), except if such representation or warranty refers to a specific date or period, then as of such date or for such period:

Section 3.01 Organization; Powers. Each of Holdings, each Borrower and with respect to each Borrower, each of their respective Restricted Subsidiaries (a) is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (b) has all requisite power and authority to own its property and assets and to carry on its business as now conducted and as proposed to be conducted, (c) is qualified to do business in, and is in good standing in, every jurisdiction where such qualification is required, except where the failure so to qualify could not reasonably be expected to result in a Material Adverse Effect, and (d) has the power and authority to execute, deliver and perform its obligations under each of the Loan Documents and each other agreement or instrument contemplated thereby to which it is or will be a party and, in the case of each Borrower, to borrow hereunder.

Section 3.02 Authorization. The Transactions (a) have been duly authorized by all requisite corporate and, if required, stockholder action and (b) will not (i) violate (A) any provision of law, statute, rule or regulation, or of the certificate or articles of incorporation or other constitutive documents or by-laws of Holdings, the Borrowers or with respect to each Borrower, any of their respective Restricted Subsidiaries, (B) any order of any Governmental Authority or (C) any provision of any indenture, material agreement or other material instrument to which Holdings, the Borrowers or with respect to each Borrower, any of their Restricted Subsidiaries is a party or by which any of them or any of their property is or may be bound, (ii) be in conflict with, result in a breach of or constitute (alone or with notice or lapse of time or both) a default under, or give rise to any right to accelerate or to require the prepayment, repurchase or redemption of any obligation under any such indenture, material agreement or other material instrument or (iii) result in the creation or imposition of any Lien upon or with respect to any material property or assets now owned or hereafter acquired by Holdings, the Borrowers or with respect to each Borrower, any of their respective Restricted Subsidiaries (other than any Lien created under the Security Documents).

Section 3.03 Enforceability. This Agreement has been duly executed and delivered by Holdings and each Borrower and constitutes, and each other Loan Document when executed and delivered by each Loan Party thereto will constitute, a legal, valid and binding obligation of such Loan Party enforceable against such Loan Party in accordance with its terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors rights generally or by equitable principles relating to enforceability.

Section 3.04 Governmental Approvals. No action, consent or approval of, registration or filing with or any other action by any Governmental Authority is or will be required in connection with the Transactions, except for (a) the filing of UCC financing statements (or equivalent filings) and filings with the United States Patent and Trademark Office and the United States Copyright Office, (b) recordation of the Mortgages, (c) such as have been made or obtained and are in full force and effect and (d) the filing of certain of the Loan Documents with the FCC pursuant to the requirements of the FCC’s rules and regulations.

Section 3.05 Financial Statements. The Lead Borrower has heretofore furnished to the Lenders the Historical Financial Statements. The Historical Financial Statements present fairly the financial condition and results of operations and cash flows of the applicable Loan Parties as of such dates and for such periods. Such balance sheets and the notes thereto disclose all material liabilities, direct or contingent, of such Loan Parties as of the dates thereof. Such financial statements were prepared in accordance with GAAP applied on a consistent basis, subject, in the case of unaudited financial statements, to year-end audit adjustments and the absence of footnotes.

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Section 3.06 No Material Adverse Effect. No event, change or condition has occurred that has had, or could reasonably be expected to have, a Material Adverse Effect since April 4, 2013.

 

Section 3.07 Title to Properties; Possession Under Leases.

(a)       Each of the Borrowers and their respective Restricted Subsidiaries has good and marketable title to, or valid leasehold interests in, all its material properties and assets (including all Mortgaged Property), except for minor defects in title that do not interfere with its ability to conduct its business in substantially the same manner as currently conducted or to utilize such properties and assets for their intended purposes. All such material properties and assets are free and clear of Liens, other than Liens permitted by Section 6.02.

(b)       Each of the Borrowers and their respective Restricted Subsidiaries has complied in all material respects with all material obligations under all Material Leases to which it is a party and all such leases are in full force and effect. Each of the Borrowers and their respective Restricted Subsidiaries enjoy peaceful and undisturbed possession under all such Material Leases.

(c)       As of the Closing Date, neither Borrower has received any notice of, nor has any knowledge of, any pending or contemplated material condemnation proceeding affecting the Mortgaged Properties or any sale or disposition thereof in lieu of condemnation.

(d)       As of the Closing Date, none of the Borrowers or any of their respective Restricted Subsidiaries is obligated under any right of first refusal, option or other contractual right to sell, assign or otherwise dispose of any Mortgaged Property or any interest therein.

Section 3.08 Subsidiaries. Schedule 3.08 sets forth as of the Closing Date a list of all Subsidiaries (with an annotation to identify the Immaterial Subsidiaries) and the percentage ownership interest of Holdings or the Borrowers therein. The shares of capital stock or other ownership interests so indicated on Schedule 3.08 are fully paid and non-assessable and are owned by Holdings or the Borrowers, directly or indirectly, free and clear of all Liens (other than Liens created under the Security Documents and after the Closing Date, Liens permitted under Section 6.02).

Section 3.09 Litigation; Compliance with Laws.

(a)       Except as set forth on Schedule 3.09, there are no actions, suits or proceedings at law or in equity or by or before any Governmental Authority now pending or, to the knowledge of any Borrower, threatened against or affecting the Borrowers or any of their respective Restricted Subsidiaries or any business, property or rights of any such Person (i) that involve any Loan Document or (ii) involve the Transactions or (iii) as to which there is a reasonable possibility of an adverse determination and that, if adversely determined, could, in the case of either clause (ii) or (iii), reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.

(b)       None of the Borrowers or any of their respective Restricted Subsidiaries or any of their respective material properties or assets is in violation of, nor will the continued operation of their material properties and assets as currently conducted violate, any law, rule or regulation (including any zoning, building, Environmental Law, ordinance, code or approval or any building permits) or any restrictions of record or agreements affecting the Mortgaged Property, or is in default with respect to any judgment, writ, injunction, decree or order of any Governmental Authority, where such violation or default could reasonably be expected to result in a Material Adverse Effect.

(c)       Certificates of occupancy and permits are in effect for each Mortgaged Property as currently constructed.

Section 3.10 Designation of Indebtedness. The Obligations constitute senior indebtedness that is entitled to the benefits of the subordination provisions of any subordinated debt documents, if any, of all Indebtedness of the Borrowers and their Subsidiaries.

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Section 3.11 Federal Reserve Regulations.

 

(a)       None of Holdings, any Borrower or with respect to the Borrowers, any of their respective Restricted Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of buying or carrying Margin Stock.

(b)       No part of the proceeds of any Term Loan will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, for any purpose that entails a violation of, or that is inconsistent with, the provisions of the Regulations of the Board, including Regulation T, U or X.

Section 3.12 Investment Company Act. None of Holdings, any Borrower or with respect to the Borrowers, any of their respective Restricted Subsidiaries is or is required to be registered as an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940.

Section 3.13 Use of Proceeds. The Borrowers will (a) use the proceeds of Incremental Term Loans only for the purposes specified in the applicable Incremental Term Loan Assumption Agreement and (b) use the proceeds of New Term Loans only for the purposes specified in the applicable New Term Loan Commitment Agreement. The proceeds of the Additional Term B-1 Loans made pursuant to the Additional Term B-1 Commitment shall be used for the repayment of Term B Loans required to be made pursuant to Section 2.04 and for working capital needs and general corporate purposes (including Permitted Acquisitions) of the Borrowers and their Subsidiaries. The proceeds of the Add-on Term B-1 Loans made pursuant to the Add-on Term B-1 Commitment shall be used on the Amendment No. 3 Effective Date to consummate one or more Permitted Acquisitions and/or to replenish cash utilized for such Permitted Acquisitions for working capital or general corporate purposes. The Borrowers will use the Borrowings under the Revolving Credit Facility for working capital or general corporate purposes.

Section 3.14 Tax Returns. Each of Holdings, the Borrowers and with respect to the Borrowers, their respective Restricted Subsidiaries has filed or caused to be filed all material federal, state, local and foreign Tax returns, statements, forms and reports (“Returns”) required to have been filed by it and has paid or caused to be paid all Taxes due and payable by it (including in the capacity of a withholding agent), except Taxes that are being contested in good faith by appropriate proceedings and for which Holdings, the applicable Borrower or such Restricted Subsidiary, as applicable, shall have set aside on its books adequate reserves in accordance with GAAP.

Section 3.15 No Material Misstatements. None of (a) the Confidential Information Memorandum or (b) any other written information, report, financial statement, exhibit or schedule furnished by or on behalf of Holdings or the Borrowers to the Administrative Agent or any Lender in connection with the negotiation of any Loan Document or included therein or delivered pursuant thereto, taken as a whole, contained, contains or will contain any material misstatement of fact or omitted, omits or will omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were, are or will be made, not materially misleading; provided that to the extent any such information, report, financial statement, exhibit or schedule was based upon or constitutes a forecast or projection, each of Holdings and the Borrowers represents only that it acted in good faith and utilized reasonable assumptions (based upon accounting principles consistent with the historical audited financial statements of the Borrower) and due care in the preparation of such information, report, financial statement, exhibit or schedule.

Section 3.16 Employee Benefit Plans.

(a)       Each Plan is in compliance with the applicable provisions of ERISA and the Code except for non-compliances which, in the aggregate, would not have a Material Adverse Effect. Except as set forth in Schedule 3.16, no ERISA Event has occurred within the past five years or is reasonably expected to occur that, when taken together with all other such ERISA Events, could reasonably be expected to have a Material Adverse Effect. As of the Closing Date, the present value of all benefit liabilities of all underfunded Plans (based on the assumptions used for purposes of Statement of Financial Accounting Standards No. 87) did not, as of the last annual valuation dates applicable thereto, exceed the fair market value of the assets of all such underfunded Plans by an amount that has or would be expected to have a Material Adverse Effect.

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b)       Each Foreign Pension Plan is in compliance with all requirements of law applicable thereto and the respective requirements of the governing documents for such plan except for non-compliances which, in the aggregate, would not have a Material Adverse Effect. With respect to each Foreign Pension Plan, none of Holdings, its Affiliates or any of their respective directors, officers, employees or agents has engaged in a transaction which would subject Holdings, the Borrowers or with respect to the Borrowers, their respective Restricted Subsidiaries, directly or indirectly, to a tax or civil penalty which could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect. As of the Closing Date, the present value of the aggregate accumulated benefit liabilities of all such Foreign Pension Plans (based on those assumptions used to fund each such Foreign Pension Plan) did not, as of the last annual valuation date applicable thereto, exceed the fair market value of the assets of all such underfunded Plans by an amount that has or would be expected to have a Material Adverse Effect.

 

Section 3.17 Environmental Matters.

(a)       Except as set forth in Schedule 3.17 and except with respect to any other matters that, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect, none of the Borrowers or with respect to the Borrowers, any of their respective Subsidiaries (i) has failed to comply with any Environmental Law or to obtain, maintain or comply with any permit, license or other approval required under any Environmental Law, (ii) has become subject to any Environmental Liability, (iii) has received notice of any claim with respect to any Environmental Liability or (iv) knows of any basis for any Environmental Liability.

(b)       Since the Closing Date, there has been no change in the status of the matters disclosed on Schedule 3.17 that, individually or in the aggregate, has resulted in, or materially increased the likelihood of, a Material Adverse Effect.

Section 3.18 [Reserved].

Section 3.19 Security Documents.

(a)       The Security Agreement, upon execution and delivery thereof by the parties thereto, will create in favor of the Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid and enforceable security interest in the Collateral and the proceeds thereof and (i) when the Pledged Collateral (as defined in the Security Agreement) is delivered to the Collateral Agent, the Lien created under the Security Agreement shall constitute a fully perfected and first priority Lien on, and security interest in, all right, title and interest of the Loan Parties in such Pledged Collateral, in each case prior and superior in right to any other Person and (ii) when financing statements and other filings in appropriate form are filed in the offices specified on Schedule 3.19(a), the Lien created under the Security Agreement with respect to the Collateral that may be perfected by filing a financing statement and other filings will constitute a fully perfected Lien on, and security interest in, all right, title and interest of the Loan Parties in such Collateral (other than trademarks, patents and copyrights subject to the Intellectual Property Security Agreements), in each case prior and superior in right to any other Person, other than with respect to Liens permitted by Section 6.02 that by operation of law or contract are prior and superior in right to the Liens securing the Obligations.

(b)       Upon the recordation of the Intellectual Property Security Agreements (or a short-form security agreement in form and substance reasonably satisfactory to the Lead Borrower and the Collateral Agent) with the United States Patent and Trademark Office and the United States Copyright Office, together with the financing statements in appropriate form filed in the offices specified on Schedule 3.19(a), the Lien created under the Security Agreement shall constitute a fully perfected Lien on, and security interest in, all right, title and interest of the Loan Parties in the IP Collateral (as defined in the Security Agreement) in which a security interest may be perfected by filing in the United States Patent and Trademark Office and the United States Copyright Office, in each case prior and superior in right to any other Person (it being understood that subsequent recordings in the United States Patent and Trademark Office and the United States Copyright Office may be necessary to perfect a Lien on registered trademarks, patents, copyrights and related applications of the foregoing acquired by the Loan Parties after the Closing Date).

(c)       The Mortgages are effective to create in favor of the Collateral Agent, for the ratable benefit of the Secured Parties, a legal, valid and enforceable Lien on all of the Loan Parties’ right, title and interest in and to the

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Mortgaged Property thereunder and the proceeds thereof, and when the Mortgages are filed in the corresponding recording office, each of the Mortgages shall constitute a fully perfected Lien on, and security interest in, all right, title and interest of the Loan Parties in such Mortgaged Property and the proceeds thereof, in each case prior and superior in right to any other Person, other than with respect to the rights of Persons pursuant to Liens permitted by Section 6.02 that by operation of law or contract are prior and superior in right to the Liens securing the Obligations and except for any Liens or encumbrances shown on title insurance policies. Notwithstanding the foregoing, the Loan Parties represent that the PR Mortgage has been duly filed and recorded in the corresponding Section of the Puerto Rico Registry of Property (except for the Deed of Amendment, which has been filed and is pending recordation in the corresponding Section of the Puerto Rico Registry of Property).

 

Section 3.20 Location of Real Property and Leased Premises.

(a)       Schedule 3.20(a) lists completely and correctly as of the Closing Date all real property owned by the Loan Parties with a fair market value greater than $3,500,000 (each, a “Material Owned Real Property”) and the addresses thereof. The Loan Parties own in fee all the real property set forth on Schedule 3.20(a).

(b)       Schedule 3.20(b) lists completely and correctly as of the Closing Date all real property leased by the Loan Parties that is material to the business or operations of the Loan Parties and could not be readily replaced on terms not materially less favorable to the lessee (each, a “Material Lease”) and the addresses thereof. The Loan Parties have valid leases in all the real property set forth on Schedule 3.20(b).

Section 3.21 Labor Matters. The hours worked by and payments made to employees of Holdings, the Borrowers and with respect to the Borrowers, their respective Restricted Subsidiaries within the past five years have not been in violation of the Fair Labor Standards Act or any other applicable federal, state, local or foreign law dealing with such matters except as could not reasonably be expected to have a Material Adverse Effect. Except as set forth on Schedule 3.21, the consummation of the Transactions will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which Holdings, the Borrowers or with respect to the Borrowers, any of their respective Restricted Subsidiaries is bound.

Section 3.22 Solvency. Immediately after the consummation of the Transactions to occur on the Closing Date and immediately following the making of each Term Loan and after giving effect to the application of the proceeds of each Term Loan, Holdings and its Restricted Subsidiaries, taken as a whole, are solvent as determined by, and determined in accordance with, the Solvency Certificate.

Section 3.23 [Reserved].

Section 3.24 Anti-Corruption Laws and Sanctions. Holdings has implemented and maintains in effect policies and procedures designed to ensure compliance by Holdings, its Subsidiaries and their respective directors, officers, employees and agents with Anti-Corruption Laws and applicable Sanctions, and Holdings, its Subsidiaries and their respective officers and employees and to the knowledge of Holdings its directors and agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in all material respects. None of (a) Holdings, any Subsidiary or any of their respective directors, officers or employees, or (b) to the knowledge of Holdings, any agent of Holdings or any Subsidiary that will act in any capacity in connection with or benefit from the credit facility established hereby, is a Sanctioned Person except to the extent permitted for such Persons and all parties hereto required to comply with Sanctions. No Borrowing, use of proceeds or other transaction contemplated by this Agreement will violate Anti-Corruption Laws or applicable Sanctions.

Section 3.25 Intellectual Property. Each of Holdings, the Borrowers and with respect to the Borrowers, each of their respective Restricted Subsidiaries owns or has the right to use all the patents, trademarks, domain names, service marks, trade names, copyrights, industrial designs, licenses, inventions, trade secrets, proprietary information and know-how of any type or rights with respect to any of the foregoing, and has obtained all licenses, consents and other rights of whatever nature, sufficient for the present conduct of its business, without any known conflict with the rights of others except as could not reasonably be expected, either individually or in the aggregate, to have a Material Adverse Effect.

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Section 3.26 Special Representations Relating to FCC Licenses, Etc.

 

(a)       The FCC Licenses include all of the material licenses, permits and other authorizations issued by the FCC to the Borrowers or their respective Restricted Subsidiaries that are necessary or required for the Borrowers and their respective Restricted Subsidiaries to conduct their business in the manner in which it is currently being conducted. Schedule 3.26 hereto lists each material FCC License held by the Borrowers or their respective Restricted Subsidiaries as of the Closing Date (including all pending applications for renewals thereof). With respect to each FCC License listed on Schedule 3.26 hereto, the description includes the call sign, channel or frequency, community of license, file number, the date of grant of the most recent license renewal and the license expiration date.

(b)       All material FCC Licenses held by the Borrowers and their respective Restricted Subsidiaries are in full force and effect in accordance with their terms. Except as set forth on Schedule 3.26, as of the Closing Date, (i) neither the Borrowers nor any of their respective Restricted Subsidiaries has received any notice of apparent liability, notice of violation, order to show cause or other writing from the FCC that could reasonably be expected to result in a Material Adverse Effect, (ii) there is no proceeding pending or, to the knowledge of the Borrowers, threatened by or before the FCC relating to the Borrowers or their respective Restricted Subsidiaries that could reasonably be expected to result in a Material Adverse Effect, (iii) to the knowledge of the Borrowers, no complaint or investigation is pending or threatened by or before the FCC (other than rulemaking proceedings of general applicability to the broadcasting industry) that could reasonably be expected to result in a Material Adverse Effect. Except as set forth in Schedule 3.26, as of the Closing Date, the Borrowers and their respective Restricted Subsidiaries have timely filed all required reports and notices with the FCC and have paid all amounts due in timely fashion on account of fees and charges to the FCC, except where the failure to do so could not reasonably be expected to result in a Material Adverse Effect.

ARTICLE IV

 


Conditions of Lending

The obligations of (i) the Lenders to make Term Loans hereunder and (ii) on and after the Amendment No. 3 Effective Date, the Revolving Lenders to make Revolving Loans and of the Issuing Banks to issue, amend or extend any Letter of Credit, are subject to the satisfaction of the following conditions:

Section 4.01 All Credit Events. On the date of each Borrowing or the date of issuance, amendment (which results in an increase or extension) or extension of any Letter of Credit (each such event being called a “Credit Event”) (other than a conversion or a continuation of a Borrowing):

(a)       The Administrative Agent shall have received a notice of such Credit Event as required by Section 2.03 or Section 10.03.

(b)       The representations and warranties set forth in Article III and in each other Loan Document shall be true and correct in all material respects on and as of the date of such Credit Event 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, and, in the case of a Borrowing under an Incremental Facility in connection with a Permitted Acquisition, subject to the proviso in subclause (ii) in the definition of Incremental Commitment Requirements.

(c)       At the time of and immediately after such Credit Event, no Default or Event of Default shall have occurred and be continuing, and, in the case of a Borrowing under an Incremental Facility in connection with a Permitted Acquisition, subject to the proviso in subclause (i) in the definition of Incremental Commitment Requirements.

(e)       Each Credit Event shall be deemed to constitute a representation and warranty by the Borrowers and Holdings on the date of such Credit Event as to the matters specified in paragraphs (b) and (c) of this Section 4.01.

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Section 4.02 First Credit Event. On the Closing Date:

 

(a)       The Administrative Agent shall have received, on behalf of itself and the Lenders, a favorable written opinion of (i) Paul, Weiss, Rifkind, Wharton & Garrison LLP, counsel for Holdings and the Borrowers, substantially to the effect set forth in Exhibit G-1, (ii) each local counsel listed on Schedule 4.02(a), substantially to the effect set forth in Exhibit G-2 and (iii) FCC counsel, substantially to the effect set forth in Exhibit G-3, in each case (A) dated the Closing Date and (B) addressed to the Administrative Agent, the Lenders and the Collateral Agent, and Holdings and the Borrowers hereby request such counsel to deliver such opinions.