EX-10.1 2 exh1012010creditagree.htm CREDIT AND GUARANTY AGREEMENT

EXHIBIT 10.1


PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.  SUCH PORTIONS ARE DESIGNATED [***].


EXECUTION VERSION



CREDIT AND GUARANTY AGREEMENT

dated as of May 6, 2010

among

PHILLIPS-VAN HEUSEN CORPORATION, as U.S. Borrower,

TOMMY HILFIGER B.V., as Foreign Borrower,

CERTAIN SUBSIDIARIES OF PHILLIPS-VAN HEUSEN CORPORATION,
as Guarantors,

VARIOUS LENDERS,

BARCLAYS CAPITAL and DEUTSCHE BANK SECURITIES INC.,
as Joint Lead Arrangers,

BARCLAYS CAPITAL, DEUTSCHE BANK SECURITIES INC., BANC OF AMERICA SECURITIES LLC, CREDIT SUISSE SECURITIES (USA) LLC and RBC CAPITAL MARKETS, as Joint Lead Bookrunners,

BARCLAYS BANK PLC,
as Administrative Agent and Collateral Agent,

DEUTSCHE BANK SECURITIES INC., as Syndication Agent,

and

BANC OF AMERICA SECURITIES LLC, CREDIT SUISSE SECURITIES (USA) LLC and RBC CAPITAL MARKETS,
as Co-Documentation Agents


________________________________________________________

Senior Secured Credit Facilities

________________________________________________________











TABLE OF CONTENTS

Page

ARTICLE I. DEFINITIONS AND INTERPRETATION

2

Section 1.01

Definitions

2

Section 1.02

Accounting Terms

62

Section 1.03

Interpretation, Etc.

62

Section 1.04

Exchange Rates; Currency Equivalents.

63

Section 1.05

Dutch Terms

64

ARTICLE II. LOANS AND LETTERS OF CREDIT

65

Section 2.01

Term Loans

65

Section 2.02

Revolving Loans

66

Section 2.03

Swing Line Loans

68

Section 2.04

Issuance of Letters of Credit and Purchase of Participations Therein

71

Section 2.05

Pro Rata Shares; Availability of Funds

79

Section 2.06

Use of Proceeds

80

Section 2.07

Evidence of Debt; Register; Notes

80

Section 2.08

Interest on Loans

81

Section 2.09

Conversion/Continuation

84

Section 2.10

Default Interest

85

Section 2.11

Fees

85

Section 2.12

Scheduled Payments/Commitment Reductions

87

Section 2.13

Voluntary Prepayments/Commitment Reductions

91

Section 2.14

Mandatory Prepayments/Commitment Reductions

94

Section 2.15

Application of Prepayments/Reductions; Application of Proceeds of Collateral  95

Section 2.16

General Provisions Regarding Payments

98

Section 2.17

Ratable Sharing

99

Section 2.18

Making or Maintaining Eurocurrency Rate Loans

100

Section 2.19

Increased Costs; Capital Adequacy

102

Section 2.20

Taxes; Withholding, Etc.

103

Section 2.21

Obligation to Mitigate

106

Section 2.22

Defaulting Lenders

106

Section 2.23

Removal or Replacement of a Lender

107

Section 2.24

Incremental Facilities

108

Section 2.25

Appointment of Borrower Representative

111

Section 2.26

Ancillary Facilities.

111

ARTICLE III. CONDITIONS PRECEDENT

115

Section 3.01

Closing Date

115

Section 3.02

Conditions to Each Credit Extension

121



i

 






ARTICLE IV. REPRESENTATIONS AND WARRANTIES

122

Section 4.01

Organization; Structure Chart; Requisite Power and Authority; Qualification  122

Section 4.02

Equity Interests and Ownership

122

Section 4.03

Due Authorization

123

Section 4.04

No Conflict

123

Section 4.05

Governmental Consents

123

Section 4.06

Binding Obligation

123

Section 4.07

Historical Financial Statements

124

Section 4.08

Projections

124

Section 4.09

No Material Adverse Change

124

Section 4.10

Adverse Proceedings, Etc.

124

Section 4.11

Payment of Taxes

125

Section 4.12

Properties

125

Section 4.13

Environmental Matters

126

Section 4.14

No Defaults

126

Section 4.15

Governmental Regulation

126

Section 4.16

Margin Stock

126

Section 4.17

Employee Benefit Plans

126

Section 4.18

Solvency

127

Section 4.19

Compliance with Statutes, Etc.

128

Section 4.20

Disclosure

128

Section 4.21

Intellectual Property

128

Section 4.22

Ranking; Security

130

Section 4.23

Centre of Main Interests and Establishments

130

Section 4.24

Dutch Loan Parties

130

Section 4.25

Shares

131

ARTICLE V. AFFIRMATIVE COVENANTS

131

Section 5.01

Financial Statements and Other Reports

131

Section 5.02

Existence

135

Section 5.03

Payment of Taxes and Claims

136

Section 5.04

Maintenance of Properties

136

Section 5.05

Insurance

136

Section 5.06

Books and Records; Inspections

137

Section 5.07

Lenders’ Calls

137

Section 5.08

Compliance with Material Contractual Obligations and Laws

137

Section 5.09

Environmental

137

Section 5.10

Maintenance of Ratings.

139

Section 5.11

Intellectual Property

139

Section 5.12

Subsidiaries

140

Section 5.13

Additional Material Real Estate Assets

141

Section 5.14

Additional Collateral

142

Section 5.15

Interest Rate Protection

142

Section 5.16

Further Assurances

142

Section 5.17

Foreign Bank Accounts and Cash held by Foreign Group Member

143



ii






Section 5.18

Guarantor Coverage Test

143

Section 5.19

Post-Closing Obligations

144

ARTICLE VI. NEGATIVE COVENANTS

144

Section 6.01

Indebtedness

144

Section 6.02

Liens

148

Section 6.03

Designation of Subsidiaries

151

Section 6.04

Restricted Payments

153

Section 6.05

Restrictions on Subsidiary Distributions; No Further Negative Pledges

154

Section 6.06

Investments

155

Section 6.07

Financial Covenants

157

Section 6.08

Fundamental Changes; Disposition of Assets; Acquisitions

159

Section 6.09

Disposal of Subsidiary Interests

161

Section 6.10

Sales and Lease-Backs

161

Section 6.11

Transactions with Shareholders and Affiliates

162

Section 6.12

Conduct of Business

162

Section 6.13

Amendments or Waivers of Organizational Documents and Certain Other Documents  163

Section 6.14

Fiscal Year

163

Section 6.15

Centre of Main Interests and Establishments

164

Section 6.16

Limitation in Relation to German Loan Parties

164

Section 6.17

UK Defined Benefit Pension Plan

165

Section 6.18

Financial Assistance

165

ARTICLE VII. GUARANTY

165

Section 7.01

Guaranty of the Obligations

165

Section 7.02

Limitation on Liability; Contribution by Guarantors

166

Section 7.03

Payment by Guarantors

167

Section 7.04

Liability of Guarantors Absolute

168

Section 7.05

Waivers by Guarantors

170

Section 7.06

Guarantors’ Rights of Subrogation, Contribution, Etc.

170

Section 7.07

Subordination of Other Obligations

171

Section 7.08

Continuing Guaranty

173

Section 7.09

Authority of Guarantors or the Borrowers

173

Section 7.10

Financial Condition of the Borrowers

173

Section 7.11

Bankruptcy, Etc.

173

Section 7.12

Discharge of Guaranty Upon Sale of Guarantor

174

Section 7.13

German Guarantor Limitations.

174

Section 7.14

Dutch Guarantor Limitations

177

Section 7.15

Subordination of the Guaranteed Obligations

177

ARTICLE VIII. EVENTS OF DEFAULT

177

Section 8.01

Events of Default

177

ARTICLE IX. AGENTS

182

Section 9.01

Appointment of Agents

182



iii






Section 9.02

Powers and Duties

182

Section 9.03

General Immunity

183

Section 9.04

Agents Entitled to Act as Lender

185

Section 9.05

Lenders’ Representations, Warranties and Acknowledgment

185

Section 9.06

Right to Indemnity

186

Section 9.07

Successor Administrative Agent, Collateral Agent and Swing Line Lender

186

Section 9.08

Security Documents and Guaranty

188

Section 9.09

Withholding Taxes

190

Section 9.10

Administrative Agent May File Proofs of Claim

190

Section 9.11

Administrative Agent’s “Know Your Customer” Requirements

191

Section 9.12

German Collateral Agent

191

Section 9.13

Certain Canadian Matters

192

Section 9.14

Parallel Debt

193

.

193

ARTICLE X. MISCELLANEOUS

196

Section 10.01

Notices

196

Section 10.02

Expenses

197

Section 10.03

Indemnity

198

Section 10.04

Set-Off

199

Section 10.05

Amendments and Waivers

200

Section 10.06

Successors and Assigns; Participations

203

Section 10.07

Independence of Covenants, Etc.

208

Section 10.08

Survival of Representations, Warranties and Agreements

208

Section 10.09

No Waiver; Remedies Cumulative

208

Section 10.10

Marshalling; Payments Set Aside

208

Section 10.11

Severability

209

Section 10.12

Obligations Several; Independent Nature of Lenders’ Rights

209

Section 10.13

Table of Contents and Headings

209

Section 10.14

APPLICABLE LAW

209

Section 10.15

CONSENT TO JURISDICTION

210

Section 10.16

WAIVER OF JURY TRIAL

210

Section 10.17

Confidentiality

211

Section 10.18

Usury Savings Clause

212

Section 10.19

Counterparts

212

Section 10.20

Effectiveness; Entire Agreement; No Third Party Beneficiaries

213

Section 10.21

PATRIOT Act

213

Section 10.22

“Know Your Customer” Checks

213

Section 10.23

Electronic Execution of Assignments

214

Section 10.24

No Fiduciary Duty

214

Section 10.25

Judgment Currency

215

Section 10.26

Ancillary Borrowers

215




iv






SCHEDULES:

1.01(a)

Tranche A Term Loan Commitments

1.01(b)

Tranche B Term Loan Commitments

1.01(c)

Revolving Commitments

1.01(d)

Notice Addresses

1.01(e) Agreed Security Principles

1.01(f) Mandatory Costs

1.01(g)

Material Companies

1.01(h)

Foreign Guarantors

1.01(i)

Existing Canadian Letters of Credit

1.01(j)

Existing Foreign Letters of Credit

1.01(k)

Existing U.S. Letters of Credit

3.01(c) Structure Chart

3.01(e)

Existing Ancillary Facilities

3.01(g)

Closing Date Mortgaged Properties

4.02

Equity Interests and Ownership

4.12

Real Estate Assets

4.21

Intellectual Property

5.12(b)

Excluded Subsidiaries

5.19

Post-Closing Items

6.01

Certain Indebtedness

6.02

Certain Liens

6.05

Certain Restrictions on Subsidiaries

6.06

Certain Investments

6.08(d)

Certain Asset Sale

6.11

Certain Affiliate Transactions



EXHIBITS:

A-1

Borrowing Notice

A-2

Conversion/Continuation Notice

A-3

Issuance Notice

B-1

Tranche A Term Loan Note

B-2

Tranche B Term Loan Note

B-3

Revolving Loan Note

B-4

Swing Line Note

B-5

Incremental Term Loan Note

C-1

Compliance Certificate

C-2

Guarantor Coverage Certificate

D

Certificate re Non-Bank Status

E-1

Closing Date Certificate

E-2

Solvency Certificate

F-1

Guarantor Counterpart Agreement

F-2

Ancillary Borrower Counterpart Agreement

G

U.S. Pledge and Security Agreement

H

Mortgage

I

Landlord Waiver and Consent Agreement

J

Joinder Agreement



v





CREDIT AND GUARANTY AGREEMENT

This CREDIT AND GUARANTY AGREEMENT, dated as of May 6, 2010, is entered into by and among PHILLIPS-VAN HEUSEN CORPORATION, a Delaware corporation (the “U.S. Borrower”), TOMMY HILFIGER B.V., a Dutch private limited liability company with its corporate seat in Amsterdam, The Netherlands (the “Foreign Borrower” and, together with the U.S. Borrower, the “Borrowers”), CERTAIN SUBSIDIARIES OF THE U.S. BORROWER, as Guarantors, the Lenders party hereto from time to time, and BARCLAYS BANK PLC (“Barclays Bank”), as Administrative Agent (together with its permitted successors in such capacity, the “Administrative Agent”) and as Collateral Agent (together with its permitted successors in such capacity, the “Collateral Agent”), with Deutsche Bank Securities Inc. (“DBSI”), as Syndication Agent (together with its permitted successors in such capacity, the “Syndication Agent”), and Banc of America Securities LLC (“BAS”), Credit Suisse Securities (USA) LLC (“CS Securities”) and Royal Bank of Canada (“RBC”), as Co-Documentation Agents (the “Co-Documentation Agents”).

RECITALS:

WHEREAS, capitalized terms used in these Recitals have the respective meanings set forth for such terms in Section 1.01 hereof;

WHEREAS, pursuant to that certain Purchase Agreement, dated as of March 15, 2010 (the “Acquisition Agreement”), by and among the U.S. Borrower, Tommy Hilfiger Corporation, a British Virgin Islands corporation (“Seller BVI”), Tommy Hilfiger Holding S.a.r.l., a Luxembourg limited liability company (together with Seller BVI, the “Seller”), Tommy Hilfiger B.V., a Dutch limited liability company (the “Acquired Business”), and the other parties thereto, the U.S. Borrower has acquired all of the equity interests (the “Acquisition”) of Tommy Hilfiger U.S.A., Inc. and the Acquired Business;

WHEREAS, in connection with the Acquisition, the U.S. Borrower shall receive at least $400,000,000 in exchange for common equity issued to the public market or to private investors (the “Equity Contribution”);

WHEREAS, the Lenders have agreed to extend certain credit facilities to the Borrowers named herein, consisting of $367,700,000 aggregate principal amount of U.S. Tranche A Term Loans, 100,000,000 aggregate principal amount of Foreign Tranche A Term Loans, $1,003,100,000 aggregate principal amount of U.S. Tranche B Term Loans, 300,000,000 aggregate principal amount of Foreign Tranche B Term Loans, up to $265,000,000 aggregate principal amount of U.S. Revolving Commitments, up to $10,000,000 aggregate principal amount of Canadian Revolving Commitments and up to 132,275,132.28 aggregate principal amount of Foreign Revolving Commitments, the proceeds of which shall be used to finance, in part, the Acquisition (including refinancing or retiring certain existing Indebtedness of the U.S. Borrower, the Acquired Business and their respective Subsidiaries and paying Transaction Costs);

WHEREAS, the Borrowers have agreed to secure all of their Obligations by granting to the Collateral Agent, for the benefit of the Secured Parties, a First Priority Lien on substantially



 






all of their respective assets, including a pledge of all of the Equity Interests of each of their respective Subsidiaries, subject to the exceptions and limitations described herein; and

WHEREAS, subject to the terms hereof and the limitations described herein, (i) the U.S. Guarantors have agreed to guarantee the obligations of the Borrowers hereunder and to secure their respective Obligations by granting to the Collateral Agent, for the benefit of the Secured Parties, a First Priority Lien on substantially all of their respective assets, including a pledge of all of the Equity Interests of each of their respective U.S. Subsidiaries and limited to 66% of all the Equity Interests of certain of their respective first tier Foreign Subsidiaries and U.S.-Owned DREs with respect to any grant of security in respect of the guarantee of obligations of the U.S. Borrower (provided, that if a U.S.-Owned DRE owns less than 100% of a Foreign Subsidiary, the granting of the securities in the Equity Interests of such U.S.-Owned DRE shall be adjusted so that the Equity Interests representing 66% (but not more than 66%) of the Equity Interests in such Foreign Subsidiary (in the aggregate) are pledged), but all of the Equity Interests of each of their Foreign Subsidiaries in respect of the guarantee of obligations of the Foreign Borrower, and (ii) the Foreign Guarantors have agreed to guarantee the obligations of the Foreign Borrower hereunder and to secure their respective Obligations by granting to the Collateral Agent, for the benefit of the Foreign Obligations Secured Parties, a First Priority Lien on certain of their respective assets, including a pledge of all of the Equity Interests of each of their respective Subsidiaries in each case of clauses (i) and (ii) subject to certain exceptions and limitations.

NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows:

ARTICLE I.
DEFINITIONS AND INTERPRETATION

Section 1.01

Definitions

.  The following terms used herein, including in the preamble, recitals, exhibits and schedules hereto, shall have the following meanings:

2020 Notes” means the 7.375% senior unsecured notes due 2020 issued by the U.S. Borrower pursuant to the 2020 Notes Indenture.

2020 Notes Documents” means the 2020 Notes, the 2020 Notes Indenture and all other instruments, agreements and other documents evidencing or governing the 2020 Notes or providing for any guarantee or other right in respect thereof

2020 Notes Indenture” means that certain Indenture dated as of the date hereof, between the U.S. Borrower and U.S. Bank National Association, as trustee.

2023 Debentures” means the 7-3/4% debentures due 2023 issued by the U.S. Borrower pursuant to the 2023 Debentures Indenture.

2023 Debentures Indenture” means that certain Indenture dated as of November 1, 1993, between the U.S. Borrower and the 2023 Debentures Trustee.



2






2023 Debentures Intercreditor Agreement” means that certain Intercreditor Agreement dated as of the date hereof between the U.S. Borrower, the Collateral Agent and The Bank of New York Mellon, as trustee under the 2023 Debentures Indenture.

2023 Debentures Obligations” means all obligations of every nature of any Group Member under or with respect to the 2023 Debentures.

2023 Debentures Trustee” means The Bank of New York, as trustee under the 2023 Debentures Indenture, and its successors in such capacity.

Acceptable Bank” means (i) any bank or financial institution that has a rating for its long-term unsecured and non credit-enhanced debt obligations of A or higher by S&P or Fitch or A2 or higher by Moody’s or a comparable rating from an internationally recognized credit rating agency or (ii) any bank that is credit insured by a United States, United Kingdom, Swiss, Danish, Japanese or Canadian or member state of the European Union government agency (including the Federal Deposit Insurance Company in the United States).  

Acquired Business” has the meaning specified in the recitals hereto.

Acquired Permitted CapEx Amount” has the meaning set forth in Section 6.07(c).

Acquisition” has the meaning specified in the recitals hereto.

Acquisition Agreement” has the meaning specified in the recitals hereto.

 “Acquisition Consideration means the purchase consideration for any Permitted Acquisition and all other payments by any Group Member in exchange for, or as part of, or in connection with, any Permitted Acquisition, whether paid in cash or by exchange of Equity Interests or of properties or otherwise and whether payable at or prior to the consummation of such Permitted Acquisition or deferred for payment at any future time, whether or not any such future payment is subject to the occurrence of any contingency, and includes any and all payments representing the purchase price and any assumptions of Indebtedness, “earn-outs” and other agreements to make any payment the amount of which is, or the terms of payment of which are, in any respect subject to or contingent upon the revenues, income, cash flow or profits (or the like) of any Person or business.  

Acquisition Documents” means the Acquisition Agreement together with all other instruments and agreements entered into by any Group Member in connection therewith.

Additional Assets” means (a) any property, plant or equipment used in any business in which any Group Member was engaged on the Closing Date and any extension of such businesses consistent with industry developments and any business ancillary, complementary or related to any of the foregoing, (b) the Equity Interests of a Person that becomes a Subsidiary as a result of the acquisition of such Equity Interests by (including by merger or consolidation with or into) any Group Member or (c) Equity Interests constituting a minority interest in any Person that at such time is a Subsidiary.



3






 “Adjusted Eurocurrency Rate” means, for any Interest Rate Determination Date with respect to an Interest Period for a Eurocurrency Rate Loan, the greater of (I) 1.75% per annum and (II) the rate per annum obtained by dividing (and rounding upward to the next whole multiple of 1/16 of 1.00%) (i) (a) the rate per annum (rounded to the nearest 1/100 of 1.00%) equal to the rate determined by the Administrative Agent to be the applicable Screen Rate for deposits (for delivery on the first day of such period) with a term equivalent to such period in the relevant currency, determined as of approximately 11:00 a.m. (London, England time) on such Interest Rate Determination Date, or (b) in the event the rates referenced in the preceding clause (a) are not available, the rate per annum (rounded to the nearest 1/100 of 1.00%) equal to the offered quotation rate to first class banks in the London interbank market by the Administrative Agent for deposits (for delivery on the first day of the relevant period) in such currency of amounts in same day funds comparable to the principal amount of the applicable Loan of the Administrative Agent, in its capacity as a Lender, for which the Adjusted Eurocurrency Rate is then being determined with maturities comparable to such period as of approximately 11:00 a.m. (London, England time) on such Interest Rate Determination Date, by (ii) an amount equal to (a) one minus (b) the Applicable Reserve Requirement.

Administrative Agent” has the meaning specified in the preamble hereto.

Adverse Proceeding” means any action, suit or proceeding at law or in equity or, to the knowledge of any Authorized Officer of any Borrower, any hearing (whether administrative, judicial or otherwise), investigation before or by any Governmental Authority or arbitration (whether or not purportedly on behalf of any Group Member) against or affecting any Group Member or any property of any Group Member.

Affected German Guarantor” has the meaning set forth in Section 7.13(a).

Affected Lender” has the meaning set forth in Section 2.18(b).

Affiliate” means, as applied to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, that Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling”, “controlled by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power (i) to vote 10.0% or more of the Securities having ordinary voting power for the election of directors of such Person or (ii) to direct or cause the direction of the management and policies of that Person, whether through the ownership of voting Securities or by contract or otherwise; provided, that no Agent or Lender shall be deemed to be an Affiliate of any Loan Party.  

Agent” means each of the Administrative Agent, the Syndication Agent, the Collateral Agent and the Co-Documentation Agents.

Agent Affiliates” has the meaning set forth in Section 10.01(b)(iii).

Aggregate Amounts Due” has the meaning set forth in Section 2.17.

Aggregate Payments” has the meaning set forth in Section 7.02(b).



4






Agreed Security Principles” means the security principles applicable to Foreign Loan Parties as set forth on Schedule 1.01(e).  

Agreement” means this Credit and Guaranty Agreement, dated as of May 6, 2010, as it may be amended, restated, supplemented or otherwise modified from time to time.

Agreement Currency” has the meaning set forth in Section 10.25.

“ALTA” means American Land Title Association, and any successor thereto.

Ancillary Borrower” means, with respect to an Ancillary Facility, any Borrower or any Group Member that shall have acceded as a Borrower to this Agreement and become a Borrower under the Ancillary Facility pursuant to Section 10.26.

Ancillary Commencement Date” means, in relation to an Ancillary Facility, the date on which that Ancillary Facility is first made available, which date shall be a Business Day within the Foreign Revolving Commitment Period.  

Ancillary Commitment” means, in relation to an Ancillary Lender and an Ancillary Facility, the Euro Equivalent of the maximum amount of Approved Currency which that Ancillary Lender has agreed (whether or not subject to satisfaction of conditions precedent) to make available from time to time under an Ancillary Facility and which has been authorized as such under Section 2.26, to the extent that amount is not cancelled or reduced under this Agreement or the Ancillary Documents relating to that Ancillary Facility.  

Ancillary Document” means each document relating to or evidencing the terms of an Ancillary Facility.  

Ancillary Facility” means any ancillary facility made available by any Ancillary Lender in accordance with Section 2.26.

Ancillary Lender” means each Lender (or Affiliate of a Lender) that makes available an Ancillary Facility in accordance with Section 2.26.  

Ancillary Outstandings” means, at any time, in relation to an Ancillary Lender and an Ancillary Facility then in force, the aggregate of the Euro Equivalent of the following amounts outstanding under such Ancillary Facility: (a) the principal amount under each overdraft facility and on-demand short term loan facility (net of any credit balances on any account of any Borrower of an Ancillary Facility with the Ancillary Lender making available such Ancillary Facility to the extent that the credit balances are freely available to be set off by such Ancillary Lender against liabilities owed to it by that Borrower under such Ancillary Facility); (b) the face amount of each guaranty, bond and letter of credit under such Ancillary Facility and (c) the amount fairly representing the aggregate exposure (excluding interest and similar charges) of such Ancillary Lender under each other type of accommodation provided under such Ancillary Facility, in each of clauses (a) through (c), as determined by such Ancillary Lender, acting reasonably in accordance with its normal banking practice and in accordance with the relevant Ancillary Document.    



5






Applicable Margin” means (i) (a) with respect to U.S. Tranche B Term Loans that are Eurocurrency Rate Loans, 3.00% per annum, (b) with respect to U.S. Tranche B Term Loans that are Base Rate Loans, 2.00% per annum and (c) with respect to Foreign Tranche B Term Loans, 3.25% per annum, (ii) with respect to Tranche A Term Loans and Revolving Loans that are Eurocurrency Rate Loans, (a) from the Closing Date until the date of delivery of the Compliance Certificate and the financial statements for the second full Fiscal Quarter after the Closing Date, a percentage, per annum, determined by reference to the following table as if the Leverage Ratio then in effect were 3.00:1.00; and (b) thereafter, a percentage, per annum, determined by reference to the Leverage Ratio in effect from time to time as set forth below:

Leverage Ratio

Applicable Margin for U.S. Tranche A Term Loans and  U.S. Revolving Loans and Canadian Revolving Loans that are Eurocurrency Rate Loans

Applicable Margin for Foreign Tranche A Term Loans and Foreign Revolving Loans

>3.00:1.00

3.00%

3.25%

<3.00:1.00

 >2.50:1.00

2.75%

3.00%

<2.50:1.00

2.50%

2.75%


and (iii) with respect to Swing Line Loans and U.S. Tranche A Term Loans and Revolving Loans that are Base Rate Loans or Canadian Prime Rate Loans, an amount equal to (a) the Applicable Margin for Eurocurrency Rate Loans as set forth in clause (ii)(a) or (ii)(b) above, as applicable, minus (b) 1.00% per annum.  No change in the Applicable Margin for Tranche A Term Loans and Revolving Loans shall be effective until three (3) Business Days after the date on which the Administrative Agent has received the applicable financial statements and a Compliance Certificate pursuant to Section 5.01(c) calculating the Leverage Ratio.  At any time the Borrower Representative has not submitted to the Administrative Agent the applicable information as and when required under Section 5.01(c), the Applicable Margin for Tranche A Term Loans and Revolving Loans shall be determined as if the Leverage Ratio were in excess of 3.00:1.00.  Promptly following receipt of the applicable information under Section 5.01(c), the Administrative Agent shall give each Lender telefacsimile or telephonic notice (confirmed in writing) of the Applicable Margin for Tranche A Term Loans and Revolving Loans in effect from such date.  In the event that any financial statement or certificate delivered pursuant to Section 5.01 is shown to be inaccurate, and such inaccuracy, if corrected, would have led to the application of a higher Applicable Margin for Tranche A Term Loans and Revolving Loans for any period (an “Applicable Period”) than the Applicable Margin for Tranche A Term Loans and Revolving Loans applied for such Applicable Period, then (i) the Borrower Representative shall immediately deliver to the Administrative Agent a correct certificate required by Section 5.01 for



6






such Applicable Period, (ii) the Applicable Margin for Tranche A Term Loans and Revolving Loans shall be recalculated with the Leverage Ratio at the corrected level and (iii) each applicable Borrower shall immediately pay to the Administrative Agent the accrued additional interest owing as a result of such increased Applicable Margin for Tranche A Term Loans and Revolving Loans for such Applicable Period.  Nothing in this definition shall limit the right of the Administrative Agent or any Lender under Section 2.10 or Article VIII and the provisions of this definition shall survive the termination of this Agreement.  

Applicable Reserve Requirement” means, at any time, for any Eurocurrency Rate Loan, the maximum rate, expressed as a decimal, at which reserves (including any basic marginal, special, supplemental, emergency or other reserves) are required to be maintained with respect thereto against “Eurocurrency liabilities” (as such term is defined in Regulation D) under regulations issued from time to time by the Board of Governors or other applicable banking regulator.  The rate of interest on Eurocurrency Rate Loans shall be adjusted automatically on and as of the effective date of any change in the Applicable Reserve Requirement.

Applicable Revolving Commitment Fee Percentage” means (a) from the Closing Date until the date of delivery of the Compliance Certificate and the financial statements for the second full Fiscal Quarter after the Closing Date, a percentage, per annum, determined by reference to the following table as if the Leverage Ratio then in effect were 3.00:1.00; and (b) thereafter, a percentage, per annum, determined by reference to the Leverage Ratio in effect from time to time as set forth below:

Leverage Ratio

Applicable Revolving Commitment Fee Percentage for U.S. Revolving Loans and Canadian Revolving Loans

Applicable Revolving Commitment Fee Percentage for Foreign Revolving Loans

>3.00:1.00

0.75%

1.30%

<3.00:1.00

 >2.50:1.00

0.75%

1.20%

<2.50:1.00

0.50%

1.10%


No change in the Applicable Revolving Commitment Fee Percentage shall be effective until three (3) Business Days after the date on which the Administrative Agent has received the applicable financial statements and a Compliance Certificate pursuant to Section 5.01(c) calculating the Leverage Ratio.  At any time the Borrower Representative has not submitted to the Administrative Agent the applicable information as and when required under Section 5.01(c), the Applicable Revolving Commitment Fee Percentage shall be determined as if the Leverage Ratio were in excess of 3.00:1.00.  Promptly following receipt of the applicable information under Section 5.01(c), the Administrative Agent shall give each Lender telefacsimile or telephonic notice (confirmed in writing) of the Applicable Revolving Commitment Fee Percentage in effect from such date.  In the event that any financial statement or certificate



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delivered pursuant to Section 5.01 is shown to be inaccurate, and such inaccuracy, if corrected, would have led to the application of a higher Applicable Revolving Commitment Fee Percentage for any Applicable Period than the Applicable Revolving Commitment Fee Percentage applied for such Applicable Period, then (i) the Borrower Representative shall immediately deliver to the Administrative Agent a correct certificate required by Section 5.01 for such Applicable Period, (ii) the Applicable Revolving Commitment Fee Percentage shall be recalculated with the Leverage Ratio at the corrected level and (iii) each applicable Borrower shall immediately pay to the Administrative Agent the accrued additional fees owing as a result of such increased Applicable Revolving Commitment Fee Percentage for such Applicable Period.  Nothing in this definition shall limit the right of the Administrative Agent or any Lender under Section 2.10 or Article VIII and the provisions of this definition shall survive the termination of this Agreement.

Appointer” has the meaning set forth in Section 9.13.

Approved Currency” means each of Dollars, Euros, Canadian Dollars or any Other Foreign Currency.

Approved Electronic Communications” means any notice, demand, communication, information, document or other material that any Loan Party provides to the Administrative Agent pursuant to any Loan Document or the transactions contemplated therein which is distributed to Agents or to Lenders by means of electronic communications pursuant to Section 10.01(b).

Arrangers means each of Barclays Capital and DBSI, in its capacity as joint lead arranger under the Commitment Letter.

Asset Sale” means a sale, lease or sub-lease (as lessor or sublessor), sale and leaseback, assignment, conveyance, exclusive license (as licensor or sublicensor), transfer or other disposition to, or any exchange of property with, any Person (other than (a) any Loan Party or (b) any Restricted Subsidiary in the ordinary course of business), in one transaction or a series of transactions, of all or any part of any Group Member’s businesses, assets or properties of any kind, whether real, personal, or mixed and whether tangible or intangible, whether now owned or hereafter acquired, leased or licensed, including the Equity Interests of any of the U.S. Borrower’s Subsidiaries, other than (i) inventory (or other assets) sold, leased, licensed out or otherwise disposed of in the ordinary course of business, (ii) sales, leases, licenses out or other dispositions of worn out, obsolete, scrap or surplus assets or assets no longer useful in the conduct of the business of any Group Member, in each case, in the ordinary course of business and (iii) sales, leases, licenses out or other dispositions of other assets for aggregate consideration of less than $7,500,000 with respect to any transaction or series of related transactions.

 “Assignment Agreement” means an assignment agreement in the form agreed to by the Administrative Agent and the Lenders on the Closing Date, with such amendments or modifications solely to reflect market practice as may be approved in writing by the Administrative Agent.

Assignment Effective Date has the meaning set forth in Section 10.06(b).  



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Attributable Indebtedness means, in respect of any Sale and Lease-Back, as at the time of determination, the present value (discounted at the interest rate borne by the 2020 Notes, compounded annually) of the total obligations of the lessee for rental payments during the remaining term of the Capital Lease included in such Sale and Lease-Back (including any period for which such Capital Lease has been extended).

Auditor's Determination” has the meaning set forth in Section 7.13(f).

Authorized Officer” means, as applied to any Person, the chairman of the board (if an officer), principal executive officer, president or any corporate vice presidents (or the equivalent thereof), principal financial officer, principal accounting officer or any director of such Person. Unless otherwise specified, an Authorized Officer shall refer to an Authorized Officer of the Borrower Representative.

Available Amount” means, as of any date, the sum, without duplication, of: (i) the aggregate cumulative amount of any Consolidated Excess Cash Flow to the extent not otherwise required to be applied pursuant to Section 2.14(d), beginning with the Fiscal Year ending January 30, 2011, (ii) the Net Cash Proceeds received after the Closing Date and on or prior to the date of such determination of the Available Amount, of any sale of Equity Interests by, or capital contribution to, the U.S. Borrower (which, in the case of any such sale of Equity Interests is not Disqualified Equity Interests and are not issued in connection with the Transactions), and (iii) an amount equal to any returns (including dividends, interest, distributions, returns on principal, profits on sale, repayments, income and similar amounts) actually received in cash and Cash Equivalents by any Loan Party in respect of any Investments made pursuant to Section 6.06(m), less, the sum of any Available Amount used to make (w) Restricted Payments pursuant to Section 6.04(f) and 6.04(g), (x) Investments permitted by Section 6.06(m) and (y) below par purchases of Term Loans in accordance with Section 2.13(c).  For the avoidance of doubt, any Net Cash Proceeds from the sale of Equity Interests or any cash returns received in respect of any Investment pursuant to Section 6.06(m)(ii) or (n)(ii) received by any Group Member shall not be included in the Available Amount to the extent such Net Cash Proceeds or cash returns are utilized to make Restricted Payments pursuant to Section 6.04(f)(ii) or Investments pursuant to Section 6.06(m)(ii) or (n)(ii) as applicable, which are not specifically tied to the Available Amount.

Bank Guarantee means a direct guaranty issued for the account of the Foreign Borrower pursuant to this Agreement by an Issuing Bank, in form acceptable to such Issuing Bank, ensuring that a liability of the Foreign Borrower acceptable to such Issuing Bank and owing to a third party will be met.

Bankruptcy Code” means Title 11 of the United States Code entitled “Bank­ruptcy,” as now and hereafter in effect, or any successor statute.

Barclays Bank has the meaning specified in the preamble hereto.

Barclays Capital means Barclays Capital, the investment banking division of Barclays Bank.

BAS has the meaning specified in the preamble hereto.



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Base Rate” means, for any day, a rate per annum equal to the greater of (i) the Prime Rate in effect on such day, (ii) the Federal Funds Effective Rate in effect on such day plus ½ of 1.00%, (iii) 2.75% and (iv) the Adjusted Eurocurrency Rate that would be payable on such day for a Eurocurrency Rate Loan with a one-month Interest Period plus 1.00%.  Any change in the Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective on the effective day of such change in the Prime Rate or the Federal Funds Effective Rate, respectively.

Base Rate Loan” means a Loan bearing interest at a rate determined by reference to the Base Rate.

Board of Directors” means with respect to any Person, the board of directors, the board of managers or similar governing body of such Person, or if such Person is owned and/or managed by a single entity, the board of directors or similar governing body of such entity.

Board of Governors” means the Board of Governors of the United States Federal Reserve System, or any successor thereto.

Bookrunners means each of Barclays Capital, DBSI, BAS, CS Securities and RBC Capital Markets, in its capacity as joint bookrunner under the Commitment Letter.

Borrower Financial Advisor” has the meaning set forth in Section 10.24.  

Borrower Representative” means the U.S. Borrower in its capacity as representative of the other Borrowers as set forth in Section 2.25.

Borrowers” means the Persons identified as the “Borrowers” in the preamble hereto or any other Person that may accede to this Agreement as an Ancillary Borrower hereunder.

Borrowing Notice” means a notice substantially in the form of Exhibit A-1.

Business Day” means any day other than a Saturday, Sunday or other day on which commercial banks are authorized to close under the laws of, or are in fact closed in, the state where the Administrative Agent’s Principal Office with respect to the Obligations denominated in Dollars is located and:

(a)

if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in Dollars, any fundings, disbursements, settlements and payments in Dollars in respect of any such Eurocurrency Rate Loan, or any other dealings in Dollars to be carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan, means any such day on which dealings in deposits in Dollars are conducted by and between banks in the London interbank eurodollar market;

(b)

if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in Euro, any fundings, disbursements, settlements and payments in Euro in respect of any such Eurocurrency Rate Loan, or any other dealings in Euro to be carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan, means any day on



10






which the Trans-European Automated Real-time Gross Settlement Express Transfer which utilizes a single shared platform and which was launched on 19 November 2007 (TARGET 2) payment system (or, if such payment system ceases to be operative, such other payment system (if any) determined by the Administrative Agent to be a suitable replacement) is open for the settlement of payments in Euro;

(c)

if such day relates to any interest rate settings as to a Eurocurrency Rate Loan denominated in a currency other than Dollars or Euro, means any such day on which dealings in deposits in the relevant currency are conducted by and between banks in the London or other applicable offshore interbank market for such currency;

(d)

if such day relates to any fundings, disbursements, settlements and payments in a currency other than Dollars or Euro in respect of a Eurocurrency Rate Loan denominated in a currency other than Dollars or Euro, or any other dealings in any currency other than Dollars or Euro to be carried out pursuant to this Agreement in respect of any such Eurocurrency Rate Loan (other than any interest rate settings), means any such day on which banks are open for foreign exchange business in the principal financial center of the country of such currency;

(e)

if such date relates to any interest rate settings, funding, disbursement, settlements and payments in Canadian Dollars, means any day other than a Saturday, Sunday or other day on which commercial banks in Toronto, Ontario are authorized or required by law to close; and

(f)

if such day relates to any actions, omissions or obligations pursuant to Section 7.13, means any day other than a Saturday, Sunday or other day on which banks in Düsseldorf, Germany, are closed.

Canadian Dollars” means the lawful money of Canada.

Canadian Issuing Bank” means an Issuing Bank that has agreed to issue Canadian Letters of Credit.

Canadian Letter of Credit” means any commercial or standby letter of credit issued or to be issued by an Issuing Bank for the account of the U.S. Borrower or any of its Subsidiaries pursuant to Section 2.04(a)(iii) of this Agreement, and any letter of credit listed on Schedule 1.01(i) issued and outstanding as of the Closing Date.  Each such letter of credit listed on Schedule 1.01(i) shall be deemed to constitute a Canadian Letter of Credit and a Letter of Credit issued hereunder on the Closing Date for all purposes under this Agreement and the other Loan Documents.

Canadian Letter of Credit Sublimit” means the lesser of (a) $5,000,000 and (b) the aggregate unused amount of the Canadian Revolving Commitments then in effect.  

Canadian Letter of Credit Usage” means, as at any date of determination, the sum of (i) the Dollar Equivalent of the maximum aggregate amount which is, or at any time thereafter may become, available for drawing under all Canadian Letters of Credit then outstanding, and (ii) the Dollar Equivalent of the aggregate amount of all drawings under



11






Canadian Letters of Credit honored by the Issuing Bank and not theretofore reimbursed by or on behalf of the U.S. Borrower.

Canadian Loan Party” means any Loan Party organized under the laws of Canada or any province or territory thereof.

Canadian Prime Rate” means, at any time, the greater of (i) the average of the rates of interest per annum equal to the per annum rate of interest quoted, published and commonly known in Canada as the “prime rate” or which Royal Bank of Canada establishes at its main office in Toronto, Ontario as the reference rate of interest in order to determine interest rates for loans in Canadian Dollars to its Canadian borrowers, adjusted automatically with each quoted or published change in such rate, all without the necessity of any notice to the U.S. Borrower or any other Person and (ii) the sum of (x) the average of the rates per annum for Canadial Dollar bankers’ acceptances having a term of one month that appears on the Reuters Screen CDOR Page as of 10:00 a.m. (Toronto time) on the date of determination, as reported by the Administrative Agent (and if such screen is not available, any successor or similar service as may be selected by the Administrative Agent), and (y) 1.00%.

Canadian Prime Rate Loans” means Loans for which the applicable rate of interest is based upon the Canadian Prime Rate.

Canadian Refunded Swing Line Loans” has the meaning set forth in Section 2.03(b)(iv).

Canadian Revolving Commitment” means the commitment of a Lender to make or otherwise fund any Canadian Revolving Loan and to acquire participations in Canadian Letters of Credit and Swing Line Loans hereunder and “Canadian Revolving Commitments” means such commitments of all Lenders in the aggregate.  The amount of each Lender’s Canadian Revolving Commitment, if any, is set forth on Schedule 1.01(c) or in the applicable Assignment Agreement or Joinder Agreement, as applicable, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the Canadian Revolving Commitments as of the Closing Date is $10,000,000.

Canadian Revolving Commitment Period” means the period from the Closing Date to but excluding the Canadian Revolving Commitment Termination Date.

Canadian Revolving Commitment Termination Date” means the earliest to occur of (i) the fifth anniversary of the Closing Date, (ii) the date the Canadian Revolving Commitments are permanently reduced to zero pursuant to Section 2.13(b) or 2.14 and (iii) the date of the termination of the Canadian Revolving Commitments pursuant to Section 8.01.

Canadian Revolving Exposure” means, with respect to any Lender as of any date of determination, (i) prior to the termination of the Canadian Revolving Commitments, that Lender’s Canadian Revolving Commitment; and (ii) after the termination of the Canadian Revolving Commitments, the sum of (a) the Dollar Equivalent of the aggregate outstanding principal amount of the Canadian Revolving Loans of that Lender, (b) in the case of an Issuing Bank, the Dollar Equivalent of the aggregate Canadian Letter of Credit Usage in respect of all Canadian Letters of Credit issued by such Issuing Bank (net of any participations by Lenders in



12






such Canadian Letters of Credit),  (c) the Dollar Equivalent of the aggregate amount of all participations by that Lender in any outstanding Canadian Letters of Credit or any unreimbursed drawing under any Canadian Letter of Credit, (d) in the case of the Canadian Swing Line Lender, the aggregate outstanding principal amount of all Canadian Swing Line Loans (net of any participations therein by other Lenders), and (e) the aggregate amount of all participations therein by that Lender in any outstanding Canadian Swing Line Loans.

Canadian Revolving Loan” means Loans made by a Lender in respect of its Canadian Revolving Commitment to the U.S. Borrower pursuant to Section 2.02(c) and/or Section 2.24.

Canadian Security Documents” means (i) the Ontario law governed general security agreements entered into by Tommy Hilfiger Canada Inc. and Tommy Hilfiger Retail Canada, Inc.; (ii) the Quebec law governed deeds of hypothec, bonds, delivery orders and bond pledges entered into by Tommy Hilfiger Canada Inc. and Tommy Hilfiger Retail Canada Inc., (iii) the New York law governed share pledge agreements over the shares in Tommy Hilfiger Canada Inc. entered into by Tomcan Investments Inc. as pledgor; and (iv) the Ontario law governed share pledge agreement over the shares in  Tommy Hilfiger Retail Canada Inc. entered into by Tommy Hilfiger Canada Inc. as pledgor.

Canadian Swing Line Lender” means Barclays Bank in its capacity as the Canadian Swing Line Lender hereunder, together with its permitted successors and assigns in such capacity.

Canadian Swing Line Loan” means a Loan made by the Canadian Swing Line Lender to the U.S. Borrower pursuant to Section 2.03(a)(ii).

Canadian Swing Line Sublimit” means the lesser of (i) $5,000,000 and (ii) the aggregate unused amount of Canadian Revolving Commitments then in effect.

 “Capital Lease” means, as applied to any Person, any lease of any property (whether real, personal or mixed) by that Person as lessee that, in conformity with GAAP, is or should be accounted for as a capital lease on the balance sheet of that Person.

Cash Collateralize” means either (a) the delivery of cash to the Collateral Agent as security for the payment of Obligations in respect of Letters of Credit in an amount equal to 102.0% of the aggregate face amount of such outstanding Letters of Credit or (b) the delivery to the applicable Issuing Bank of a customary back-to-back letter of credit in an amount equal to 102.0% of the aggregate face amount of the outstanding Letters of Credit issued by such Issuing Bank.  “Cash Collateralization” has a correlative meaning.

 “Cash Equivalents” means, as at any date of determination, any of the following: (i) marketable securities (a) issued or directly and unconditionally guaranteed as to interest and principal by the United States or Canadian Government or (b) issued by any agency of the United States the obligations of which are backed by the full faith and credit of the United States or Canada, in each case maturing within one year after such date; (ii) marketable direct obligations issued by any state or province of the United States of America or Canada, as the case may be, or any political subdivision of any such state, province or any public



13






instrumentality thereof, in each case maturing within one year after such date and having, at the time of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s or the equivalent rating from any other internationally recognized rating agency; (iii) certificates of deposit or bankers’ acceptances maturing within one year after such date and issued or accepted by any Lender or by any commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia or Canada that (a) is at least “adequately capitalized” (as defined in the regulations of its primary Federal banking regulator), (b) has Tier 1 capital (as defined in such regulations) of not less than $500,000,000 and (c) has a rating of at least AA- from S&P and Aa3 from Moody’s or the equivalent rating from any other internationally recognized rating agency; and (iv) shares of any money market mutual fund that (a) has substantially all of its assets invested continuously in the types of investments referred to in clauses (i) and (ii) above, (b) has net assets of not less than $5,000,000,000 and (c) has the highest rating obtainable from either S&P or Moody’s or the equivalent rating from any other internationally recognized rating agency; provided, that, in the case of any Investment by a Subsidiary that is not a U.S. Subsidiary, “Cash Equivalents” shall also include: (x) direct obligations of the sovereign nation (or any agency thereof) in which such Foreign Subsidiary is organized and is conducting business or in obligations fully and unconditionally guaranteed by such sovereign nation (or any agency thereof), in each case maturing within a year after such date, (y) investments of the type and maturity described in clauses (i) through (iv) above of Subsidiaries that are not U.S. Subsidiaries, which Investments have ratings described in such clauses or equivalent ratings from comparable foreign rating agencies and (z) shares of money market mutual or similar funds which invest exclusively in assets otherwise satisfying the requirements of this definition (including this proviso).

Cash Management Agreement” means any agreement or arrangement to provide treasury, depository, overdraft, credit or debit card, purchase card, electronic funds transfer (including automated clearinghouse transfer services) and other cash management services entered into with a Lender Counterparty.

Certificate re Non-Bank Status” means a certificate substantially in the form of Exhibit D.

Change of Control” means, (i) any Person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) (a) shall have acquired beneficial ownership or control of 35.0% or more on a fully diluted basis of the voting interest in the Equity Interests of the U.S. Borrower or (b) shall have obtained the power (whether or not exercised) to elect a majority of the members of the Board of Directors of the U.S. Borrower, (ii) the majority of the seats (other than vacant seats) on the Board of Directors of the U.S. Borrower cease to be occupied by Continuing Directors, (iii) the U.S. Borrower shall cease to own, directly or indirectly, 100% of the Equity Interests of the Foreign Borrower or (iv) any “change of control” (or similar event, however denominated) shall occur under and as defined in any indenture or agreement in respect of Material Indebtedness of any Borrower.

China JV” means that certain joint venture that the U.S. Borrower (or any of its Subsidiaries) and certain other persons may form after the date hereof to operate and use the Tommy Hilfiger brands or brands of the U.S. Borrower in the People’s Republic of China and, in certain circumstances, Hong Kong.



14






CK Distribution” means a CK Distribution as such term is defined in the CKI Intercreditor Agreement.

CK Letter Agreement” means that certain letter agreement, dated April 7, 2010 by and between the U.S. Borrower and Mr. Calvin Klein.

CKI” means Calvin Klein, Inc., a New York corporation.

CKI Affiliates” means CK Service Corp. and any Person that becomes a Subsidiary of CKI or CK Service Corp. after the date hereof.

CKI Amount” means, for any period, the Design Services Purchase Payments, as defined in and paid or payable by any Group Member to Mr. Calvin Klein or the Klein heirs for such period pursuant to the CKI Stock Purchase Agreement.

CKI and Debenture Obligations” means the “First Lien Obligations” as defined in the CKI Intercreditor Agreement.

CKI Blockage Event” means the commencement of a Blockage Period, as defined in the CKI Intercreditor Agreement.

CKI Collateral Agent” means The Bank of New York Mellon Trust Company, N.A., as collateral agent under the CKI Security Agreement, and its successors in such capacity.

CKI Documents” means the CKI Stock Purchase Agreement, the CKI Security Agreement, the CKI Pledgor Guarantees and the CKI Intercreditor Agreement

CKI Intercreditor Agreement” means that certain Intercreditor Agreement dated May 6, 2010, among the Collateral Agent and the CKI Collateral Agent, as such agreement may be amended, restated, supplemented or otherwise modified from time to time in accordance with the terms hereof.

CKI Liquidated Damages Amount” means the Liquidated Damages Amount as such term is defined in the CKI Stock Purchase Agreement as of the date hereof.

CKI Obligations” means all obligations of every nature of the U.S. Borrower, CKI and the CKI Affiliates under or with respect to the CKI Documents.

CKI Pledgor Guarantees” means the Pledgor Guarantees, as the same may be amended, restated, supplemented or otherwise modified from time to time, into which each of CKI and CK Service Corp. has entered, and certain CKI Affiliates may enter from time to time after the date hereof, pursuant to which CKI and CK Service Corp. and, if any, the CKI Affiliates party thereto have guaranteed the payment in full of the U.S. Borrower’s obligations under the CKI Stock Purchase Agreement.

CKI Related Assets Pledge and Security Agreement” means the CKI Related Assets Pledge and Security Agreement to be executed by the U.S. Borrower, CKI and the CKI



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Affiliates in favor of the Collateral Agent substantially in the form of Exhibit G, as it may be amended, restated, supplemented or otherwise modified from time to time.

 “CKI Security Agreement” means that certain Amended and Restated Pledge and Security Agreement, dated as of the date hereof, among the U.S. Borrower, CKI, the CKI Affiliates, the CKI Collateral Agent and Mr. Calvin Klein, pursuant to which a First Priority Lien shall have been granted to the CKI Collateral Agent on the Equity Interests in CKI and the CKI Affiliates and on any other assets of CKI and the CKI Affiliates named therein, to secure the CKI Obligations as it may be amended, restated, supplemented or otherwise modified from time to time.

CKI Stock Purchase Agreement” means the Stock Purchase Agreement dated as of December 17, 2002, among the U.S. Borrower, CKI, the CKI Affiliates and the sellers named therein, as it may be amended, restated, supplemented or otherwise modified from time to time.

CKI Trust” means the trust established pursuant to the Delaware Business Trust Act, as amended, and the CKI Trust Agreement.

CKI Trust Agreement” means the Trust Agreement dated as of March 14, 1994, between CKI and Wilmington Trust Company, relating to the CKI Trust, and the other agreements related thereto.

Class” means (i) with respect to Lenders, each of the following classes of Lenders: (a) Lenders having U.S. Tranche A Term Loan Exposure, (b) Lenders having Foreign Tranche A Term Loan Exposure, (c) Lenders having U.S. Tranche B Term Loan Exposure, (d) Lenders having Foreign Tranche B Term Loan Exposure, (e) Lenders having U.S. Revolving Exposure (including U.S. Swing Line Lender), (f) Lenders having Foreign Revolving Exposure, (g) Lenders having Canadian Revolving Exposure (including the Canadian Swing Line Lender) and (h) Lenders having Incremental Term Loan Exposure of each applicable Series, and (ii) with respect to Loans, each of the following classes of Loans: (a) U.S. Tranche A Term Loans, (b) Foreign Tranche A Term Loans, (c) U.S. Tranche B Term Loans, (d) Foreign Tranche B Term Loans, (e) U.S. Revolving Loans (including U.S. Swing Line Loans), (f) Foreign Revolving Loans, (g) Canadian Revolving Loans (including Canadian Swing Line Loans) and (h) each Series of Incremental Term Loans.

Closing Date” means the date on which the Term Loans are made, which occurred on May 6, 2010.

Closing Date Ancillary Facility” means that facility made available to the Foreign Borrower, Tommy Hilfiger Group B.V. and Tommy Hilfiger Europe B.V. pursuant to that certain Ancillary Facility Agreement, dated as of May 6, 2010, among the Foreign Borrower, Tommy Hilfiger Group B.V., Tommy Hilfiger Europe B.V. and Fortis Bank (Nederland) N.V.

Closing Date Certificate” means a Closing Date Certificate substantially in the form of Exhibit E-1.



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Closing Date Mortgaged Property” has the meaning set forth in Section 3.01(g)(1).

Co-Documentation Agents” has the meaning specified in the preamble hereto.

Collateral” means, collectively, all of the real, personal and mixed property (including Equity Interests) in which Liens are purported to be granted pursuant to the Security Documents as security for the Obligations.

Collateral Agent” has the meaning specified in the preamble hereto.

Commitment” means any Revolving Commitment or Term Loan Commitment.

Commitment Letter” has the meaning set forth in Section 10.20.

Compliance Certificate” means a Compliance Certificate substantially in the form of Exhibit C-1.

Confidential Information Memorandum” means the Confidential Information Memorandum of the Borrowers dated as of April 14, 2010.

Consolidated Adjusted EBITDA” means, for any period, an amount determined for the Group on a consolidated basis equal to (i) Consolidated Net Income, plus, to the extent reducing Consolidated Net Income, the sum, without duplication, of amounts for (a) consolidated interest expense, (b) provisions for taxes based on income, profits or capital, (c) total depreciation expense, (d) total amortization expense, (e) other non-cash charges (including, without limitation, any non-cash charges related to writing up inventory in connection with the Acquisition, but excluding any non-cash charge to the extent that it represents an accrual of or reserve for cash expenditures in any future period), (f) net cash charges associated with or related to any contemplated restructurings related to the Acquisition in an aggregate amount not to exceed $90,000,000, (g) all amounts in respect of extraordinary, unusual or non-recurring losses, expenses or charges (including, without limitation, (A) restructuring charges (other than those described in clause (f)), (B) any fees, expenses or charges relating to plant shutdowns and discontinued operations, (C) acquisition integration costs and (D) any expenses or charges relating to any offering of Equity Interests, Permitted Acquisition, or any Investment or Indebtedness permitted under this Agreement, in each case under this clause (D), whether or not successful), (h) any financial advisory fees, accounting fees, legal fees and other similar advisory and consulting fees and related out-of-pocket expenses incurred by any Group Member as a result of the Acquisition, in an aggregate amount not to exceed $55,000,000, (i) with respect to any four-Fiscal Quarter measurement period ending on or prior to the end of the eighth full Fiscal Quarter following the Closing Date, the amount of cost savings and other operating improvements and synergies projected by the U.S. Borrower in good faith to be realized as a result of the Acquisition (calculated on a pro forma basis as though such cost savings and other operating improvements and synergies had been realized on the first day of such period), without duplication of the amount of actual benefits realized during such period from such actions to the extent already included in the Consolidated Net Income for such period, in an aggregate amount not to exceed $40,000,000, (j) losses on agreements with respect to Hedge Agreements and any related tax gains, in each case incurred in connection with or as a result of the Acquisition, and



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(k) non-cash losses on agreements with respect to Hedge Agreements, minus, (ii) to the extent included in calculating Consolidated Net Income, the sum of (a) all amounts in respect of extraordinary, unusual or nonrecurring gains, (b) gains on agreements with respect to Hedge Agreements and any related tax gains, in each case incurred in connection with or as a result of the Acquisition, (c) non-cash gains on agreements with respect to Hedge Agreements, (d) cash payments made during such period with respect to non-cash charges that were added back pursuant to clause (e) above in a prior period, and (e) other non-cash gains increasing Consolidated Net Income for such period (excluding any such non-cash gain to the extent it represents the reversal of an accrual or reserve for potential cash gain in any prior period).  For the avoidance of doubt, Consolidated Adjusted EBITDA shall be calculated to exclude any gain resulting from any debt repurchase (including, for the avoidance of doubt, repurchases of Loans under Section 2.13(c) or repurchases of the 2023 Debentures).

In addition, for purposes of making the calculation referred to above, acquisitions (including the Acquisition), Investments, dispositions, mergers, consolidations, operational improvements and discontinued operations (as determined in accordance with GAAP) that have been made by any Group Member, including through mergers or consolidations and including any related financing transactions, during the relevant period or subsequent to such period and on or prior to the date of such calculation (the “relevant transaction”), shall be deemed to have occurred on the first day of the relevant period and (without duplication of the pro forma adjustments provided for in the immediately preceding paragraph with respect to the Acquisition) such calculation shall be made giving pro forma effect to any cost savings and other operating improvements and synergies in connection with such relevant transaction (without duplication of actual benefits realized during such period from the same) that are (a) factually supportable and determined in good faith by the U.S. Borrower, as certified in an officer’s certificate signed by an Authorized Officer and (b) do not exceed the actual cost savings expected in good faith to be realized by the Group over the twelve-month period following such relevant transaction.

 “Consolidated Capital Expenditures” means, for any period, the aggregate of all expenditures of the Group during such period determined on a consolidated basis that, in accordance with GAAP, are or should be included in “purchase of property and equipment” or similar items reflected in the consolidated statement of cash flows of the Group; provided, that Consolidated Capital Expenditures shall not include any expenditures (i) for replacements and substitutions for fixed assets, capital assets or equipment to the extent made with Net Cash Proceeds invested pursuant to Section 2.14(a) or Section 2.14(b) or (ii) which constitute a Permitted Acquisition permitted under Section 6.08.

Consolidated Cash Interest Expense” means, for any period, total interest expense payable in cash in such period (including that portion attributable to Capital Leases in accordance with GAAP and capitalized interest) of the Group on a consolidated basis with respect to all outstanding Indebtedness of the Group (net of cash interest income), excluding, however, any one time financing fees (to the extent included in such Person’s consolidated interest expense for such period).



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Consolidated Current Assets” means, as at any date of determination, the total assets of the Group on a consolidated basis that may properly be classified as current assets in conformity with GAAP, excluding cash and Cash Equivalents.

Consolidated Current Liabilities” means, as at any date of determination, the total liabilities of the Group on a consolidated basis that may properly be classified as current liabilities in conformity with GAAP, excluding the current portion of long term debt.

Consolidated Excess Cash Flow” means, for any period, an amount (if positive) equal to:

(i) the sum, without duplication, of the amounts for such period of (a) Consolidated Net Income, (b) to the extent reducing Consolidated Net Income, the sum, without duplication, of amounts for non-cash charges reducing Consolidated Net Income, including for depreciation and amortization (excluding any such non-cash charge to the extent that it represents an accrual or reserve for potential cash charge in any future period or amortization of a prepaid cash charge that was paid in a prior period) and (c) the Consolidated Working Capital Adjustment, minus

(ii) the sum, without duplication, of (a) the amounts for such period paid in cash of (1) scheduled repayments of Indebtedness to the extent actually made (excluding for the avoidance of doubt, repayments of revolving loans or swing line loans except to the extent the related revolving commitments are permanently reduced in connection with such repayments and any purchases (or repayments in connection therewith) of Loans pursuant to Section 2.13(c)) and scheduled repayments of obligations under Capital Leases (excluding any interest expense portion thereof), (2) Consolidated Capital Expenditures, and (3) to the extent actually declared, Restricted Payments permitted by Section 6.04(d), and (b) other non-cash gains increasing Consolidated Net Income for such period (excluding any such non-cash gain to the extent it represents the reversal of an accrual or reserve for potential cash gain in any prior period).

Consolidated Net Income” means, for any period, (i) the net income (or loss) of the Group on a consolidated basis for such period taken as a single accounting period determined in conformity with GAAP, minus (ii) (a) the income (or loss) of any Person (other than a Group Member) in which any other Person (other than a Group Member) has a joint interest, except to the extent of the amount of dividends or other distributions actually paid to any Group Member by such Person during such period, (b) to the extent included in net income, the income (or loss) of any Person accrued prior to the date it becomes a Group Member or is merged into or consolidated with the Group or that Person’s assets are acquired by any Group Member, (c) the income of any Subsidiary of the U.S. Borrower to the extent that the declaration or payment of dividends or similar distributions by that Subsidiary of that income is not at the time permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary, (d) any after-tax non-cash gains (or losses) attributable to Asset Sales or returned surplus assets of any Pension Plan, (e) the CKI Amount and the Itochu Amount to the extent not already reducing net income; provided that, if during any period, the U.S. Borrower or any of its Subsidiaries repays the Itochu Amount in whole, then for such period, the excess of the amount of such amounts repaid over the regularly scheduled payment of the Itochu Amount for such period shall not reduce net income,



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and (f) (to the extent not included in clauses (a) through (e) above) any net extraordinary gains or net extraordinary losses.  For the avoidance of doubt, cash amounts used by the Borrowers to make purchases of debt (including purchases of Loans under Section 2.13(c) and purchases of the 2023 Debentures) shall not reduce Consolidated Net Income, nor will any non-cash gain associated with the cancellation of such purchased debt increase Consolidated Net Income.  

Consolidated Total Assets” means as of any date of determination, the total assets of the Group, determined in accordance with GAAP, as set forth on the consolidated balance sheet of the U.S. Borrower as of such date.

Consolidated Total Debt” means, as at any date of determination, (a) the aggregate stated balance sheet amount of all Indebtedness of the Group (or, if higher, the par value or stated face amount of all such Indebtedness (other than zero coupon Indebtedness) determined on a consolidated basis in accordance with GAAP, exclusive of any contingent liability in respect of any Letter of Credit, plus (b) to the extent not included in clause (a), Indebtedness relating to securitization of receivables generated by the Group (whether or not such Indebtedness is on the balance sheet of the Group).  For the avoidance of doubt, Consolidated Total Debt will be calculated to exclude all Indebtedness of the Group to ITOCHU Corporation pursuant to the Itochu Agreement or otherwise related to such agreement and all Indebtedness of the Group pursuant to the CKI Documents.

Consolidated Working Capital” means, as at any date of determination, the excess of Consolidated Current Assets of the Group over Consolidated Current Liabilities of the Group.

Consolidated Working Capital Adjustment” means, for any period on a consolidated basis, the amount (which may be a negative number) by which Consolidated Working Capital as of the beginning of such period exceeds (or is less than) Consolidated Working Capital as of the end of such period.  In calculating the Consolidated Working Capital Adjustment there shall be excluded the effect of reclassification during such period of current assets to long term assets and current liabilities to long term liabilities and the effect of any Permitted Acquisition during such period; provided, that there shall be included with respect to any Permitted Acquisition during such period an amount (which may be a negative number) by which the Consolidated Working Capital acquired in such Permitted Acquisition as at the time of such acquisition exceeds (or is less than) Consolidated Working Capital at the end of such period.

Contingent Liability” means any agreement, undertaking or arrangement by which any Person guarantees, endorses or otherwise becomes or is contingently liable upon (by direct or indirect agreement, contingent or otherwise, to provide funds for payment, to supply funds to, or otherwise to invest in, a debtor, or otherwise to assure a creditor against loss) the Indebtedness of any other Person (other than by endorsements of instruments in the course of collection), or guarantees the payment of dividends or other distributions upon the Equity Interests of any other Person. The amount of any Person’s obligation under any Contingent Liability shall (subject to any limitation with respect thereto) be deemed to be the outstanding principal amount of the debt, obligation or other liability guaranteed thereby.



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Continuing Directors” means individuals who on the Closing Date constituted the Board of Directors of the U.S. Borrower (together with any new directors whose election by such Board of Directors or whose nomination for election by the stockholders of the U.S. Borrower was approved by a vote of a majority of the directors of the U.S. Borrower then still in office who were either directors on the Closing Date or whose election or nomination for election was previously so approved).

 “Contractual Obligation” means, as applied to any Person, any provision of any Security issued by that Person or of any indenture, mortgage, deed of trust, contract, undertaking, agreement or other instrument to which that Person is a party or by which it or any of its properties is bound or to which it or any of its properties is subject.

Contributing Guarantors” has the meaning set forth in Section 7.02(b).

Conversion/Continuation Date” means the effective date of a continuation or conversion, as the case may be, as set forth in the applicable Conversion/Continuation Notice.

Conversion/Continuation Notice” means a Conversion/Continuation Notice substantially in the form of Exhibit A-2.

Copyrights” has the meaning set forth in the U.S. Pledge and Security Agreement.

Corresponding Debt” means, in respect of a Loan Party, its Foreign Corresponding Debt or its U.S. Corresponding Debt.

Counterpart Agreement” means a Counterpart Agreement substantially in the form of Exhibit F-1 or Exhibit F-2, as applicable, delivered by a Loan Party pursuant to Section 5.12 or by an Ancillary Borrower pursuant to Section 10.26.

Covenant Transaction” has the meaning set forth in Section 1.04(c).

Credit Date” means the date of a Credit Extension.

Credit Extension” means the making of a Loan or the issuing of a Letter of Credit.

Crown” means the government of Canada, any provincial or territorial government therein and any of their political subdivisions.

 “CS Securities has the meaning specified in the preamble hereto.

Currency Agreement” means any foreign exchange contract, currency swap agreement, futures contract, option contract, synthetic cap or other similar agreement or arrangement, each of which is for the purpose of hedging the foreign currency risk of the Group and not for speculative purposes.

DBSI has the meaning specified in the preamble hereto.



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Debtor Relief Law” means the Bankruptcy Code and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, examinership, reorganization or similar debtor relief laws of the United States or other Relevant Jurisdiction from time to time in effect and affecting the rights of creditors generally.

Default” means a condition or event that, after notice or lapse of time or both, would constitute an Event of Default.

Default Rate” has the meaning set forth in Section 2.10.

Defaulting Lender” means any Lender that has (a) failed to fund any portion of its Revolving Commitment within three (3) Business Days of the date required to be funded by it hereunder, (b) notified the Borrower Representative, the Administrative Agent or any Lender in writing, or has otherwise indicated through a public statement, that it does not intend to comply with its funding obligations hereunder and generally under agreements in which it commits to extend credit, (c) failed, within three Business Days after receipt of a written request from the Administrative Agent, to confirm that it will comply with the terms of this Agreement relating to its obligations to fund prospective Revolving Commitments, (d) otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within three Business Days of the date when due, unless the subject of a good faith dispute or (e) become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, custodian, administrator, examiner, liquidator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has a parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, custodian, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment, provided that a Lender shall not qualify as a Defaulting Lender solely as a result of the acquisition or maintenance of an ownership interest in such Lender or its parent company, or of the exercise of control over such Lender or any Person controlling such Lender, by a Governmental Authority or instrumentality thereof; provided that if the Borrower Representative, the Administrative Agent, the applicable Swing Line Lender and the applicable Issuing Bank agree in writing in their sole discretion that a Defaulting Lender should no longer be deemed to be a Defaulting Lender, the Administrative Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateralization of Letters of Credit and/or Swing Line Loans), that Lender will, to the extent applicable, purchase that portion of outstanding Loans of the other Lenders or take such other actions as the Administrative Agent may determine to be necessary to cause the obligations of the Swing Line Lender and/or the Issuing Bank and the funded and unfunded participations in Letters of Credit and Swing Line Loans to be held on a pro rata basis by the Lenders in accordance with their Pro Rata Shares (without giving effect to Section 2.22), whereupon that Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrowers while that Lender was a Defaulting Lender; and



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provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.

Defaulting Revolving Lender” has the meaning set forth in Section 2.22.

Designated Gross Amount” has the meaning set forth in Section 2.26(b)(ii)

Designated Net Amount” has the meaning set forth in Section 2.26(b)(ii)

Disqualified Equity Interests” means any Equity Interest which, by its terms (or by the terms of any security or other Equity Interests into which it is convertible or for which it is exchangeable), or upon the happening of any event or condition (i) matures or is mandatorily redeemable (other than solely for Equity Interests which are not otherwise Disqualified Equity Interests), pursuant to a sinking fund obligation or otherwise, (ii) is redeemable at the option of the holder thereof (other than solely for Equity Interests which are not otherwise Disqualified Equity Interests), in whole or in part, (iii) provides for scheduled payments of dividends in cash or (iv) is or becomes convertible into or exchangeable for Indebtedness or any other Equity Interests that would constitute Disqualified Equity Interests, in each case, prior to the date that is 91 days after the Term Loan Maturity Date, except, in the case of clauses (i) and (ii), if as a result of a change of control or asset sale, so long as any rights of the holders thereof upon the occurrence of such a change of control or asset sale event are subject to the prior Payment in Full of all Obligations.

Dollar Equivalent” means, with respect to an amount denominated in Dollars, such amount, and with respect to an amount denominated in any other Approved Currency, the equivalent in Dollars of such amount determined at the Exchange Rate on the applicable Valuation Date.  In making the determination of the Dollar Equivalent for purposes of determining the aggregate available U.S. Revolving Commitments on any Credit Date, the Administrative Agent shall use the Exchange Rate in effect at the date on which any U.S. Borrower requests the extension of credit for such Credit Date pursuant to the provisions of this Agreement.

Dollars” and the sign “$” mean the lawful money of the United States of America.

Dutch Closing Security Documents” means:

(i)

the Foreign Law Partnership Pledge Agreement;

(ii)

the Dutch law deed of pledge of shares in Prince 1 B.V. by, inter alios, Trumpet C.V. as pledgor, as well as the updated shareholders' register in which the pledge of shares has been registered;

(iii)

the Dutch law deed of pledge of shares in Prince 2 B.V. by, inter alios, Prince 1 B.V. as pledgor, as well as the updated shareholders' register in which the pledge of shares has been registered;



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(iv)

the Dutch law deed of pledge of shares in the Foreign Borrower by, inter alios, Prince 2 B.V. as pledgor, as well as the updated shareholders' register in which the pledge of shares has been registered;

(v)

the Dutch law deed of pledge of shares in Tommy Hilfiger Group B.V. by, inter alios, the Foreign Borrower as pledgor, as well as the updated shareholders' register in which the pledge of shares has been registered;

(vi)

the Dutch law deed of disclosed pledge bank accounts by, inter alios, Trumpet C.V., Prince 1 B.V., Prince 2 B.V. and the Foreign Borrower as pledgors, as well as fully executed notices to the respective account banks;

(vii)

the Dutch law deed of disclosed pledge of intercompany receivables by, inter alios, Trumpet C.V., Prince 1 B.V., Prince 2 B.V. and the Foreign Borrower as pledgors, as well as fully executed notices to the respective debtors;

(viii)

the Dutch law deed of disclosed pledge of insurance claims by, inter alios, Trumpet C.V., Prince 1 B.V., Prince 2 B.V. and the Foreign Borrower as pledgors, as well as fully executed notices to the respective debtors;

(ix)

the Dutch law deed of undisclosed pledge of third party receivables by, inter alios, Trumpet C.V., Prince 1 B.V., Prince 2 B.V. and the Foreign Borrower as pledgors; and

(x)

the Dutch law deed of pledge of moveable assets by, inter alios, Trumpet C.V., Prince 1 B.V., Prince 2 B.V. and the Foreign Borrower as pledgors.

Dutch Loan Party” means any Loan Party incorporated in The Netherlands.

Dutch Security” means the Collateral that is the subject of any Security Document governed by the laws of The Netherlands.

Dutch Security Documents” means, in relation to each applicable Dutch Loan Party (or (a) in the case of a share pledge, each shareholder of the applicable Dutch Loan Party, or (b) in case of a pledge of an Intellectual Property Asset registered in The Netherlands (or, in respect of any trademark or design, the Benelux), the Loan Party that is the holder of that Intellectual Property Asset): (i) Dutch law notarial deeds of pledge of shares over the shares in each Dutch Loan Party as well as the updated shareholders' register in which the pledge of shares has been registered; (ii) Dutch law disclosed deeds of pledge of bank accounts as well as fully executed notices to the respective account banks; (iii) Dutch law disclosed deeds of pledge of intercompany receivables as well as fully executed notices to the respective debtors; (iv) Dutch law disclosed deeds of pledge of insurance receivables as well as fully executed notices to the respective debtors; (v) Dutch law undisclosed deeds of pledge of third party receivables (other than receivables subject to any Lien interest pursuant to another Security Document); (vi) Dutch law undisclosed deeds of pledge over movable assets; (vii) Dutch law notarial deeds of mortgage over any Real Estate Assets located in The Netherlands, and (viii) Dutch law deed of pledge over any Intellectual Property Assets registered in The Netherlands (or, in respect of any trademark or design, the Benelux).



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Eligible Assignee” means any Person other than a natural Person that is (i) a Lender, an Affiliate of any Lender or a Related Fund (any two or more Related Funds being treated as a single Eligible Assignee for all purposes hereof), or (ii) a commercial bank, insurance company, investment or mutual fund, European Credit Management Limited (ECM) programmes or other entity that is an “accredited investor” (as defined in Regulation D under the Securities Act) and which extends credit or buys loans in the ordinary course of business; provided, that neither any Loan Party nor any Affiliate thereof, nor any Defaulting Lender, shall be an Eligible Assignee.

Employee Benefit Plan” means any “employee benefit plan” as defined in Section 3(3) of ERISA which is or was sponsored, maintained or contributed to by, or required to be contributed by, the Group or any of their respective ERISA Affiliates or with respect to which the Group or any of their respective ERISA Affiliates has or would reasonably be expected to have liability, contingent or otherwise, under ERISA.

Environmental Claim” means any investigation, notice, notice of violation, claim, action, suit, proceeding, demand, abatement order or other order, decree or directive (conditional or otherwise) by any Governmental Authority or any other Person, arising (i) pursuant to any Environmental Law, (ii) in connection with any actual or alleged violation of, or liability pursuant to, any Environmental Law, (iii) in connection with any Hazardous Material, including the presence or Release of, or exposure to, any Hazardous Materials and any abatement, removal, remedial, corrective or other response action related to Hazardous Materials or (iv) in connection with any actual or alleged damage, injury, threat or harm to health, safety, natural resources or the environment.

Environmental Laws” means any and all current or future foreign or domestic, federal, state or local laws (including any common law), statutes, ordinances, orders, rules, regulations, judgments or any other requirements of Governmental Authorities relating to or imposing liability or standards of conduct with respect to (i) environmental matters, (ii) the generation, use, storage, transportation or disposal of, or exposure to, Hazardous Materials; or (iii) occupational safety and health, industrial hygiene, land use or the protection of human, plant or animal health or welfare, in any manner applicable to any Group Member or any Facility.

Equity Contribution” has the meaning set forth in the recitals hereto.

Equity Interests” means any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), including partnership interests and membership interests, and any and all warrants, rights or options to purchase or other arrangements or rights to acquire any of the foregoing.

ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, the regulations promulgated thereunder and any successor thereto.

ERISA Affiliate” means, as applied to any Person, (i) any corporation which is a member of a controlled group of corporations within the meaning of Section 414(b) of the Internal Revenue Code of which that Person is a member; (ii) any trade or business (whether or



25






not incorporated) which is a member of a group of trades or businesses under common control within the meaning of Section 414(c) of the Internal Revenue Code of which that Person is a member; and (iii) any member of an affiliated service group within the meaning of Section 414(m) or (o) of the Internal Revenue Code of which that Person, any corporation described in clause (i) above or any trade or business described in clause (ii) above is a member.  Any former ERISA Affiliate of any Group Member shall continue to be considered an ERISA Affiliate of such Group Member within the meaning of this definition with respect to the period such entity was an ERISA Affiliate of such Group Member and with respect to liabilities arising after such period for which such Group Member could be liable under the Internal Revenue Code or ERISA.

ERISA Event” means (i) a “reportable event” within the meaning of Section 4043 of ERISA and the regulations issued thereunder with respect to any Pension Plan (excluding those for which the provision for 30-day notice to the PBGC has been waived by a regulation in effect on the date hereof); (ii) the failure to meet the minimum funding standard of Sections 412 or 430 of the Internal Revenue Code or Sections 302 or 303 of ERISA with respect to any Pension Plan (whether or not waived in accordance with Section 412(c) of the Internal Revenue Code or Section 302(c) of ERISA) or the failure to make by its due date a required installment under Section 430(j) of the Internal Revenue Code with respect to any Pension Plan or the failure to make any required contribution to a Multiemployer Plan; (iii) a determination by the Pension Plan’s actuary that any Pension Plan is, or is expected to be, in “at risk” status (as defined in Section 430 of the Internal Revenue Code or Section 303 of ERISA); (iv) the provision by the administrator of any Pension Plan pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress termination described in Section 4041(c) of ERISA; (v) a determination under and in accordance with said sections that any Multiemployer Plan is, or is expected to be, in “critical” or “endangered” status under Section 432 of the Internal Revenue Code or Section 305 of ERISA; (vi) the withdrawal by any Group Member or any of its ERISA Affiliates from any Pension Plan with two or more contributing sponsors or the termination of any such Pension Plan resulting in liability to any Group Member or any of its Affiliates pursuant to Section 4063 or 4064 of ERISA; (vii) the institution by the PBGC of proceedings to terminate any Pension Plan, or the occurrence of any event or condition which is reasonably likely to constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan; (viii) the imposition of liability on any Group Member or any of its ERISA Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of Section 4212(c) of ERISA; (ix) the withdrawal of any Group Member or any of its ERISA Affiliates in a complete or partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any potential liability therefor, or the receipt by any Group Member or any of its ERISA Affiliates of notice from any Multiemployer Plan that it is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to terminate or has terminated under Section 4041A or 4042 of ERISA; (x) the imposition of a Lien pursuant to Section 430(k) of the Internal Revenue Code or Section 303(k) of ERISA or a violation of Section 436 of the Internal Revenue Code with respect to any Pension Plan; (xi) the occurrence of any Foreign Plan Event or (xii) any other event or condition with respect to an Employee Benefit Plan with respect to which any Group Member is likely to incur liability other than in the ordinary course.



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 “Euro” or “ means the single currency of the European Union as constituted by the Treaty on European Union and as referred to in the legislative measures of the European Union for the introduction of, changeover to or operation of the Euro in one or more member states, being in part legislative measures to implement the European and Monetary Union as contemplated in the Treaty on European Union.

Euro Equivalent” means, with respect to an amount denominated in Euros, such amount, and with respect to an amount denominated in Dollars or any Other Foreign Currency, the equivalent in Euros of such amount determined at the Exchange Rate on the applicable Valuation Date.  In making the determination of the Euro Equivalent for purposes of determining the aggregate available Foreign Revolving Commitments on any Credit Date, the Administrative Agent shall use the Exchange Rate in effect at the date on which the Foreign Borrower requests the extension of credit for such Credit Date pursuant to the provisions of this Agreement.

Eurocurrency Rate Loan” means a Loan bearing interest at a rate determined by reference to the Adjusted Eurocurrency Rate.

Event of Default” means any of the conditions or events set forth in Section 8.01.

Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time, and any successor statute.

Exchange Rate” means the rate at which any currency (the “Original Currency”) may be exchanged into Dollars, Euros or another currency (the “Exchanged Currency”), as set forth on such date on the relevant Reuters screen at or about 11:00 a.m. (London, England time) on such date.  In the event that such rate does not appear on the Reuters screen, the “Exchange Rate” with respect to such Original Currency into such Exchanged Currency shall be determined by reference to such other publicly available service for displaying exchange rates as may be agreed upon by the Administrative Agent and the Borrower Representative or, in the absence of such agreement, such “Exchange Rate” shall instead be the Administrative Agent’s spot rate of exchange in the interbank market where its foreign currency exchange operations in respect of such Original Currency are then being conducted, at or about 11:00 a.m., local time, on such date for the purchase of the Exchanged Currency, with such Original Currency for delivery two Business Days later; provided, that if at the time of any such determination, no such spot rate can reasonably be quoted, the Administrative Agent may use any reasonable method as it deems applicable to determine such rate, and such determination shall be conclusive absent manifest error.

Excluded Taxes” means (i) any Tax imposed on the overall net income of a Person (or franchise tax or minimum tax imposed in lieu thereof) by the jurisdiction in which that Person is organized or in which that Person’s principal office (and/or, in the case of a Lender, its applicable lending office) is located or with which that Person has a present or former connection (other than any connection arising solely from the acquisition and holding of any Loan and/or Commitment (including entering into or being a party to this Agreement), the receipt of payments relating thereto, and/or the exercise of rights and remedies under this Agreement or any other Loan Document); (ii) with respect to any Lender to a U.S. Loan (other than a Lender that becomes a Lender pursuant to Section 2.23), any Tax imposed pursuant to the



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laws of the United States of America or any political subdivision thereof or therein that would apply if any payment were made under any of the Loan Documents to such Lender on the day such Lender becomes a Lender (or designates a new lending office), except to the extent such Lender’s assignor (or such Lender, when it designates a new lending office) was entitled to receive additional amounts pursuant to Section 2.20; (iii) with respect to any Lender, any withholding Tax that is imposed on any payment to such Lender on the day that such Lender becomes a Lender (or designates a new lending office) by any jurisdiction, excluding any jurisdiction (other than the United States of America or any political subdivision thereof, which shall be governed by clause (ii) hereof) that would not have imposed such Tax but for the fact that any of the Loan Parties is organized or has its principal office located in such jurisdiction, or has a present or former connection with, or makes or causes to be made any payment under any Loan Document through, such jurisdiction on behalf of any Loan Party, except to the extent such Lender’s assignor (or such Lender, when it designates a new lending office) was entitled to receive additional amounts pursuant to Section 2.20; (iv) any Tax that is attributable to a Lender’s failure to comply with Section 2.20(c) of this Agreement or (v) any U.S. federal Tax imposed by reason of a Lender’s failure to comply with the requirements of Sections 1471 through 1474 of the Code and any regulations promulgated thereunder (the “FATCA”).

Existing Credit Facilities Indebtedness” means (i) Indebtedness and other obligations outstanding under that certain Second Amended and Restated Credit Agreement, dated as of July 10, 2007, among the U.S. Borrower and certain of its Subsidiaries, as borrowers or guarantors, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, the lenders party thereto and the other agents party thereto, as amended prior to the Closing Date and (ii) the Existing Tommy Facilities.

Existing Notes” means the U.S. Borrower’s 8-1/8% Senior Notes due 2013 issued pursuant to that certain Indenture dated as of May 5, 2003 between the U.S. Borrower and U.S. Bank, National Association, as trustee and the U.S. Borrower’s 7-1/4% Senior Notes due 2011 issued pursuant to that certain Indenture dated as of February 18, 2004 between the U.S. Borrower and U.S. Bank National Association, as trustee.

Existing Tommy Facilities” means that certain (i) Senior Facilities Agreement, dated as of April 27, 2006, as amended and restated on May 9, 2006, among the Acquired Business (formerly known as Elmira 1 B.V.) and certain Subsidiaries of the Acquired Business, as borrowers or guarantors, Citibank International PLC, as agent for certain financial institutions party thereto as lenders, and the other parties thereto and (ii) Mezzanine Facilities Agreement, dated as of April 28, 2006, as amended and restated on May 9, 2006, among the Acquired Business (formerly known as Elmira 1 B.V.) and certain Subsidiaries of the Acquired Business, as guarantors, Credit Suisse, London Branch, as agent for certain financial institutions party thereto as lenders, and the other parties thereto.

Facility” means any real property (including all buildings, fixtures or other improvements located thereon) now, hereafter or heretofore owned, leased, operated or used by any Group Member or any of its predecessors or Affiliates.

Fair Share” has the meaning set forth in Section 7.02(b).



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Fair Share Contribution Amount” has the meaning set forth in Section 7.02(b).

FATCA” has the meaning set forth in the definition of “Excluded Taxes”.

FDIC” means the Federal Deposit Insurance Corporation, and any successor thereto.

Federal Funds Effective Rate” means for any day, the rate per annum (expressed, as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1.00%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided, that (i) if such day is not a Business Day, the Federal Funds Effective Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (ii) if no such rate is so published on such next succeeding Business Day, the Federal Funds Effective Rate for such day shall be the average rate charged to the Administrative Agent, in its  capacity as a Lender, on such day on such transactions as determined by the Administrative Agent.

 “Financial Officer Certification” means, with respect to the financial statements for which such certification is required, the certification of the principal financial officer of the U.S. Borrower that such financial statements fairly present, in all material respects, the financial condition of the Group at the dates indicated and the results of their operations and their cash flows for the periods indicated, subject to changes resulting from audit and normal year-end adjustments.

Financial Plan” has the meaning set forth in Section 5.01(h).

First Priority” means, with respect to any Lien purported to be created in any Collateral pursuant to any Security Document, that such Lien is the only Lien to which such Collateral is subject, other than any Permitted Lien.

Fiscal Quarter” means a fiscal quarter of any Fiscal Year.

Fiscal Year” means the fiscal year of the Group ending on the Sunday closest to February 1 of each calendar year.

Fitch” means Fitch, Inc.

Flood Certificate” means a “Standard Flood Hazard Determination Form” of the Federal Emergency Management Agency and any successor Governmental Authority performing a similar function.

Flood Program” means the National Flood Insurance Program created by the U.S. Congress pursuant to the National Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973, the National Flood Insurance Reform Act of 1994 and the Flood Insurance Reform Act of 2004, in each case as amended from time to time, and any successor statutes.



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Flood Zone” means areas having special flood hazards as described in the National Flood Insurance Act of 1968, as amended from time to time, and any successor statute.

Foreign Borrower” has the meaning specified in the preamble hereto.

Foreign Collateral Perfection Certificate” means a certificate to be provided in respect of foreign Collateral, in a form reasonably acceptable to the Administrative Agent.

Foreign Contributing Guarantors” has the meaning set forth in Section 7.02(b).

Foreign Currency Equivalent” means, with respect to an amount denominated in Canadian Dollars or any Other Foreign Currency, such amount, and with respect to an amount denominated in Dollars or Euros, the equivalent in Canadian Dollars or such Other Foreign Currency of such amount determined at the Exchange Rate on the applicable Valuation Date.

Foreign Corresponding Debt” has the meaning set forth in Section 9.14(a)(i).

Foreign Guaranteed Obligations” has the meaning set forth in Section 7.01(b).

Foreign Guarantor” means any Guarantor that is not a U.S. Guarantor.  

Foreign Issuing Bank” means an Issuing Bank that has agreed to issue Foreign Letters of Credit.

Foreign Law Partnership Pledge Agreement” means the Dutch law governed deed of pledge of partnership interests in Trumpet C.V. by, inter alios, BassNet, Inc. and PVH Prince C.V. Holding Corporation, as pledgors, in support of the Foreign Guaranteed Obligations.

Foreign Law Security Documents” means each of the Dutch Security Documents, the German Security Documents, the Canadian Security Documents and each Foreign Law Partnership Pledge Agreement.

Foreign Letter of Credit” means any Bank Guarantee or any commercial or standby letter of credit issued or to be issued by an Issuing Bank for the account of the Foreign Borrower or any of its Subsidiaries pursuant to Section 2.04(a)(ii) of this Agreement, and any letter of credit listed on Schedule 1.01(j) issued and outstanding as of the Closing Date.  Each such letter of credit listed on Schedule 1.01(j) shall be deemed to constitute a Foreign Letter of Credit and a Letter of Credit issued hereunder on the Closing Date for all purposes under this Agreement and the other Loan Documents.

 “Foreign Letter of Credit Sublimit means the lesser of (a) 75,585,790 and (b) the aggregate unused amount of the Foreign Revolving Commitments then in effect.  

Foreign Letter of Credit Usage means, as at any date of determination, the sum of (i) the Euro Equivalent of the maximum aggregate amount which is, or at any time thereafter may become, available for drawing under all Foreign Letters of Credit then outstanding, and (ii) the Euro Equivalent of the aggregate amount of all drawings under Foreign Letters of Credit



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honored by an Issuing Bank and not theretofore reimbursed by or on behalf of the Foreign Borrower.

Foreign Loan” means a Foreign Tranche A Term Loan, a Foreign Tranche B Term Loan and/or a Foreign Revolving Loan.

Foreign Loan Party” means any Loan Party other than a U.S. Loan Party.

Foreign Obligations” means the Obligations in respect of any Foreign Loan and any other Obligations of the Foreign Borrower and Foreign Guarantors.

Foreign Obligations Secured Parties” means the Agents, Lenders, Issuing Banks, the Lender Counterparties and the Ancillary Lenders in respect of any Foreign Obligations, and shall include, without limitation, all former Agents, Lenders, Issuing Banks, Lender Counterparties and Ancillary Lenders to the extent that any Foreign Obligations owing to such Persons were incurred while such Persons were Agents, Lenders, Issuing Banks, Lender Counterparties or Ancillary Lenders and such Foreign Obligations have not been paid or satisfied in full.

Foreign Offer” has the meaning set forth in Section 2.13(c).

Foreign Offer Loans” has the meaning set forth in Section 2.13(c).

Foreign Parallel Debt” means, in respect of a Foreign Loan Party, any amount which that Foreign Loan Party owes to the Collateral Agent under Section 9.14.

Foreign Plan” shall mean any Employee Benefit Plan, program, policy, arrangement or agreement maintained or contributed to by any Foreign Loan Party or any of their respective Subsidiaries with respect to employees employed outside the United States.

Foreign Plan Event” shall mean, with respect to any Foreign 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 from a Governmental Authority relating to the intention to terminate any such Foreign Plan or to appoint a trustee or similar official to administer any such Foreign Plan, or alleging the insolvency of any such Foreign Plan, in each case which is reasonably likely to result, directly or indirectly, in material liability to a Loan Party, (d) the incurrence of any material liability by any Loan Party or any their respective Subsidiaries under applicable law on account of the complete or partial termination of such Foreign Plan or 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 would reasonably be expected to result in the incurrence of any liability by any Loan Party or any of their respective Subsidiaries, or the imposition on any Loan Party or any of their respective Subsidiaries of any fine, excise tax or penalty resulting from any noncompliance with any applicable law.



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Foreign Revolving Commitment” means the commitment of a Lender to make or otherwise fund any Foreign Revolving Loan and to acquire participations in Foreign Letters of Credit hereunder, as reduced by the amount of any Ancillary Commitment, and “Foreign Revolving Commitments means such commitments of all Lenders in the aggregate.  The amount of each Lender’s Foreign Revolving Commitment, if any, is set forth on Schedule 1.01(c) or in the applicable Assignment Agreement or Joinder Agreement, as applicable, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the Foreign Revolving Commitments as of the Closing Date is 132,275,132.28.

Foreign Revolving Commitment Period means the period from the Closing Date to but excluding the Foreign Revolving Commitment Termination Date

Foreign Revolving Commitment Termination Date” means the earliest to occur of (i) the fifth anniversary of the Closing Date, (ii) the date the Foreign Revolving Commitments are permanently reduced to zero pursuant to Section 2.13(b) or 2.14 and (iii) the date of the termination of the Foreign Revolving Commitments pursuant to Section 8.01.  

Foreign Revolving Exposure” means, with respect to any Lender as of any date of determination, (i) prior to the termination of the Foreign Revolving Commitments, that Lender’s Foreign Revolving Commitment; and (ii) after the termination of the Foreign Revolving Commitments, the sum of (a) the Euro Equivalent of the aggregate outstanding principal amount of the Foreign Revolving Loans of that Lender, (b) in the case of an Issuing Bank, the Euro Equivalent of the aggregate Foreign Letter of Credit Usage in respect of all Foreign Letters of Credit issued by such Issuing Bank (net of any participations by Lenders in such Foreign Letters of Credit), (c) the Euro Equivalent of the aggregate amount of all participations by that Lender in any outstanding Foreign Letters of Credit or any unreimbursed drawing under any Foreign Letter of Credit and (d) the Euro Equivalent of the aggregate amount of all amounts borrowed from such Lender under any Ancillary Facility pursuant to Section 2.26.

Foreign Revolving Loan” means Loans made by a Lender in respect of its Foreign Revolving Commitment to the Foreign Borrower pursuant to Section 2.02(b) and/or Section 2.24.

Foreign Subsidiary” means (i) any Restricted Subsidiary that is not organized under the laws of the United States, any State thereof or the District of Columbia (other than any such Subsidiary that is treated as a partnership or disregarded as an entity separate from its owner for U.S. federal tax purposes and all of whose partners or whose owner (as the case may be) is (or are) treated as a domestic corporation(s) for U.S. federal tax purposes) and (ii) any Restricted Subsidiary of a Subsidiary described in clause (i).

Foreign Tranche A Term Loan” means a Tranche A Term Loan denominated in Euros and made by a Lender to the Foreign Borrower pursuant to Section 2.01(a)(i).

Foreign Tranche A Term Loan Commitment” means the commitment of a Lender to make or otherwise fund a Foreign Tranche A Term Loan and “Foreign Tranche A Term Loan Commitments” means such commitments of all Lenders in the aggregate.  The amount of each Lender’s Foreign Tranche A Term Loan Commitment, if any, is set forth on



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Schedule 1.01(a) or in the applicable Assignment Agreement, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the Foreign Tranche A Term Loan Commitments as of the Closing Date is 100,000,000.

Foreign Tranche A Term Loan Exposure means, with respect to any Lender, as of any date of determination, the outstanding principal amount of the Foreign Tranche A Term Loans of such Lender; provided, that at any time prior to the making of the Foreign Tranche A Term Loans, the Foreign Tranche A Term Loan Exposure of any Lender shall be equal to such Lender’s Foreign Tranche A Term Loan Commitment.

Foreign Tranche B Term Loan” means a Tranche B Term Loan denominated in Euros and made by a Lender to the Foreign Borrower pursuant to Section 2.01(a)(ii).

Foreign Tranche B Term Loan Commitment” means the commitment of a Lender to make or otherwise fund a Foreign Tranche B Term Loan and “Foreign Tranche B Term Loan Commitments” means such commitments of all Lenders in the aggregate.  The amount of each Lender’s Foreign Tranche B Term Loan Commitment, if any, is set forth on Schedule 1.01(b) or in the applicable Assignment Agreement, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the Foreign Tranche B Term Loan Commitments as of the Closing Date is 300,000,000.

Foreign Tranche B Term Loan Exposure means, with respect to any Lender, as of any date of determination, the outstanding principal amount of the Foreign Tranche B Term Loans of such Lender; provided, that at any time prior to the making of the Foreign Tranche B Term Loans, the Foreign Tranche B Term Loan Exposure of any Lender shall be equal to such Lender’s Foreign Tranche B Term Loan Commitment.

FQ1”, “FQ2”, “FQ3” and “FQ4” mean, when used with a numerical year designation, the first, second, third or fourth Fiscal Quarters, respectively, of the designated Fiscal Year of any Borrower (e.g., FQ4 2010 means the fourth Fiscal Quarter of a Borrower’s 2010 Fiscal Year, which ends January 30, 2011).

Funding Guarantor” has the meaning set forth in Section 7.02(b).

GAAP” means, subject to the limitations on the application thereof set forth in Section 1.02, United States generally accepted accounting principles in effect as of the date of determination thereof consistently applied.

German Group Member” has the meaning set forth in Section 6.16(a).

German Loan Party” means any Loan Party incorporated in Germany.

German Security” means the Collateral that is subject of any Security Document governed by the laws of Germany.

German Security Documents” means:



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(i)

the German law governed share pledge agreements over the shares in T.H. Deutschland GmbH, Tommy Hilfiger Footwear Europe GmbH and Hilfiger Stores GmbH entered into by, inter alios, Hilfiger Holdings Germany GmbH & Co. KG as pledgor;

(ii)

the German law governed share pledge agreement over the shares in Hilfiger Beteiligungsgesellschaft mbH, entered into by, inter alios, Tommy Hilfiger Europe B.V. as pledgor;

(iii)

the German law governed interest pledge agreement over the interests in Hilfiger Holdings Germany GmbH & Co. KG, entered into by, inter alios, Tommy Hilfiger Europe B.V. and Hilfiger Beteiligungsgesellschaft mbH as pledgors;

(iv)

the German law governed account pledge agreements entered into by, inter alios, Tommy Hilfiger Footwear Europe GmbH, Hilfiger Stores GmbH, Hilfiger Holdings Germany GmbH & Co. KG, Hilfiger Beteiligungsgesellschaft mbH and T.H. Deutschland GmbH as pledgor;

(v)

the German law governed global assignment agreements entered into by, inter alios, Tommy Hilfiger Footwear Europe GmbH, Hilfiger Stores GmbH, Hilfiger Holdings Germany GmbH & Co KG, Hilfiger Beteiligungsgesellschaft mbH and T.H. Deutschland GmbH as assignor; and

(vi)

the German law governed security transfer agreements over fixed and current assets entered into by, inter alios, Tommy Hilfiger Footwear Europe GmbH, Hilfiger Stores GmbH, Hilfiger Holdings Germany GmbH & Co. KG, Hilfiger Beteiligungsgesellschaft mbH and T.H. Deutschland GmbH as transferor.

 “Governmental Acts” means any act or omission, whether rightful or wrongful, of any present or future de jure or de facto government or Governmental Authority.

Governmental Authority” means any federal, state, municipal, national or other government, governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof or any entity, officer or examiner exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government or any court, in each case whether associated with a state of the United States, the United States, or a foreign entity or government.

Governmental Authorization” means any permit, license, authorization, certification, registration, approval, plan, directive, consent order or consent decree of or from any Governmental Authority.

Group” means, collectively, the U.S. Borrower and its Restricted Subsidiaries; provided that, as used in Sections 5.01(a) and (b) with respect to the financial statements required to be delivered thereunder, it shall mean the U.S. Borrower and its consolidated Subsidiaries in accordance with GAAP.



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Group Member” means any of the U.S. Borrower or any of its Restricted Subsidiaries.

Group Member Adjusted EBITDA” means, for any period for any Group Member, the amount of Consolidated Adjusted EBITDA attributable to such Group Member for such period, calculated on an unconsolidated basis and by excluding all intercompany items (provided that, for the purpose of the determination of a Material Company solely as such term is used in Section 8.01(f), (g), (h) or (l), Group Member Adjusted EBITDA shall be calculated on a consolidated basis for such Group Member and its Subsidiaries).

Group Member Assets” means, for any Group Member, as of any date of determination, the total assets of such Group Member, determined in accordance with GAAP, calculated on an unconsolidated basis and by excluding all intercompany items (provided that, for the purpose of the determination of a Material Company solely as such term is used in Section 8.01(f), (g), (h) or (l), Group Member Assets shall be calculated on a consolidated basis for such Group Member and its Subsidiaries).

Guaranteed Obligations” has the meaning set forth in Section 7.01(b).

Guarantor” means (i) with respect to the Obligations of the U.S. Borrower, each U.S. Subsidiary and (ii) with respect to the Obligations of the Foreign Borrower, (v) the U.S. Borrower, (w) each U.S. Subsidiary, (x) any other Borrower (other than the U.S. Borrower), (y) each Foreign Subsidiary set forth on Schedule 1.01(h) and (z) each other Foreign Subsidiary guaranteeing the Obligations of the Foreign Borrower after the Closing Date.  For the avoidance of doubt, no Foreign Guarantor shall guarantee the Obligations of the U.S. Borrower or any other U.S. Loan Party.

Guarantor Coverage Certificate” means a Guarantor Coverage Certificate substantially in the form of Exhibit C-2.

Guaranty” means the guaranty of each Guarantor set forth in Article VII.

Hazardous Materials” means any pollutant, contaminant, chemical, waste, material or substance, exposure to which or Release of which is prohibited, limited or regulated by any Governmental Authority or which may or could pose a hazard to human health and safety or to the indoor or outdoor environment, including petroleum, petroleum products, asbestos, urea formaldehyde, radioactive materials, polychlorinated biphenyls (“PCBs”) and toxic mold.

Hedge Agreement” means an Interest Rate Agreement or a Currency Agreement entered into with a Lender Counterparty.

Highest Lawful Rate” means the maximum lawful interest rate, if any, that at any time or from time to time may be contracted for, charged, or received under the laws applicable to any Lender which are presently in effect or, to the extent allowed by law, under such applicable laws which may hereafter be in effect and which allow a higher maximum nonusurious interest rate than applicable laws now allow.



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Historical Financial Statements of the Acquired Business” means as of the Closing Date, (i) audited special purpose consolidated financial statements of the Acquired Business for the Fiscal Years ended March 31, 2008 and 2009 and an unqualified audit report relating thereto; (ii) audited special purpose consolidated financial statements of the Acquired Business for the Fiscal Years ended March 31, 2007 and 2008 and an unqualified audit report relating thereto; (iii) unaudited special purpose consolidated interim financial statements of the Acquired Business for the nine months ended December 31, 2009, and (iii) unaudited financial statements of the Acquired Business for the twelve-month period ended December 31, 2009.

Historical Financial Statements of the U.S. Borrower” means as of the Closing Date, audited consolidated financial statements of the U.S. Borrower consisting of balance sheets as of February 1, 2009 and January 31, 2010 and income statements and statements of stockholders' equity and cash flows for Fiscal Years 2007, 2008 and 2009 and an unqualified audit report relating thereto.

IFRS” has the meaning set forth in Section 4.07.

Increased Amount Date” has the meaning set forth in Section 2.24.

Increased-Cost Lender” has the meaning set forth in Section 2.23.

Incremental Revolving Commitments” has the meaning set forth in Section 2.24.

Incremental Revolving Loan” has the meaning set forth in Section 2.24.

Incremental Revolving Loan Lender” has the meaning set forth in Section 2.24.

Incremental Term Loan” has the meaning set forth in Section 2.24.

Incremental Term Loan Commitments” has the meaning set forth in Section 2.24.

Incremental Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding principal amount of the Incremental Term Loans of such Lender.

Incremental Term Loan Lender” has the meaning set forth in Section 2.24.

Incremental Term Loan Maturity Date” means the date on which Incremental Term Loans of a Series shall become due and payable in full hereunder, as specified in the applicable Joinder Agreement, including by acceleration or otherwise.

Incremental Term Loan Note” means a promissory note in the form of Exhibit B-5, as it may be amended, restated, supplemented or otherwise modified from time to time.

 “Incurrence Test” means that, as of the applicable test date, the Leverage Ratio as of such date, based on Consolidated Adjusted EBITDA for the most recently ended period of



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four consecutive Fiscal Quarters of the Group for which internal financial statements are available and Consolidated Total Debt as of the applicable test date, shall be 3.00:1.00 or less.

Indebtedness” means, as applied to any Person, without duplication, (i) all indebtedness for borrowed money; (ii) that portion of obligations with respect to Capital Leases that is properly classified as a capitalized liability on a balance sheet in conformity with GAAP; (iii) obligations evidenced by bonds, debentures, notes or other similar instruments; (iv) any obligation owed for all or any part of the deferred purchase price of property or services (excluding trade accounts payable and accrued expenses in the ordinary course of business which are not overdue for a period of more than 90 days or, if overdue for more than 90 days, as to which a dispute exists and adequate reserves in conformity with GAAP have been established on the books of such Person and any such obligations incurred under ERISA), which purchase price is (a) due more than six (6) months from the date of incurrence of the obligation in respect thereof or (b) evidenced by a note or similar written instrument in each case to the extent that the same would be required to be shown as a long term liability on a balance sheet prepared in accordance with GAAP; (v) all indebtedness secured by any Lien on any property or asset owned or held by that Person regardless of whether the indebtedness secured thereby shall have been assumed by that Person or is nonrecourse to the credit of that Person (provided that if the recourse to such Person in respect of such indebtedness is limited solely to the property subject to such Lien, the amount of such indebtedness shall be deemed to be the fair market value (as determined in good faith by such Person) of the property subject to such Lien or the amount of such indebtedness if less); (vi) the face amount of any letter of credit issued for the account of that Person or as to which that Person is otherwise liable for reimbursement of drawings; (vii) Disqualified Equity Interests, (viii) the net payments that such Person would have to make in the event of any early termination, on the date Indebtedness of such Person is being determined, in respect of any exchange traded or over the counter derivative transaction, including any Interest Rate Agreement and any Currency Agreement, in each case, whether entered into for hedging or speculative purposes; provided, that in no event shall obligations under any derivative transaction be deemed “Indebtedness” for any purpose under Section 6.07 or for the purpose of calculating the Incurrence Test or Leverage Ratio unless such obligations relate to a derivatives transaction which has been terminated, (ix) the full outstanding balance of trade receivables, notes or other instruments sold with full recourse in a factoring or similar transaction, other than in any such case any thereof sold solely for purposes of collection of delinquent accounts and (x) any Contingent Liability with respect to the foregoing.  The Indebtedness of any Person shall include the Indebtedness of any other Person (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such Person, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

 “Indemnified Liabilities” means, collectively, any and all liabilities, obligations, losses, damages (including natural resource damages), penalties, claims (including Environmental Claims), actions, judgments, suits, costs (including the costs of any investigation, study, sampling, testing, abatement, cleanup, removal, remediation or other necessary response action related to the Release or presence of any Hazardous Materials), expenses and disbursements of any kind or nature whatsoever (including any of the foregoing in connection with any investigative, administrative or judicial proceeding or hearing commenced or threatened by any Group Member, its Affiliates or any other Person, whether or not any such Indemnitee



37






shall be designated as a party or a potential party thereto, and any fees or expenses incurred by Indemnitees in enforcing this indemnity), whether direct, indirect, special or consequential and whether based on any federal, state or foreign laws, statutes, rules or regulations (including securities and commercial laws, statutes, rules or regulations and Environmental Laws), on common law or equitable cause or on contract or otherwise, that may be imposed on, incurred by, or asserted against any such Indemnitee, in any manner relating to or arising out of (i) this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby (including the Lenders’ agreement to make Credit Extensions, the syndication of the credit facilities provided for herein or the use or intended use of the proceeds thereof, or any enforcement of any of the Loan Documents (including any sale of, collection from, or other realization upon any of the Collateral or the enforcement of the Guaranty)); (ii) the Commitment Letter (and any related fee or engagement letter) delivered by any Agent or any Lender to the U.S. Borrower with respect to the transactions contemplated by this Agreement; (iii) any Environmental Claim relating to or arising from, directly or indirectly, any past or present activity, operation, land ownership, or practice of any Group Member; or (iv) any Loan or the use of proceeds thereof.

Indemnified Taxes” means any Taxes other than Excluded Taxes.

Indemnitee” has the meaning set forth in Section 10.03(a).

Installment” has the meaning set forth in Section 2.12(a).

Installment Date” has the meaning set forth in Section 2.12(a).

Intellectual Property” means the collective reference to all rights, priorities and privileges relating to intellectual property, whether arising under the United States, multinational or foreign laws or otherwise, including without limitation, Copyrights, Copyright Licenses, Patents, Patent Licenses, Trademarks, Trademark Licenses, Trade Secrets, and Trade Secret Licenses (as each such term is defined in the U.S. Pledge and Security Agreement), and the right to sue or otherwise recover for any past, present and future infringement, dilution, misappropriation, or other violation or impairment thereof, including the right to receive all Proceeds therefrom, including without limitation license fees, royalties, income, payments, claims, damages and proceeds of suit, now or hereafter due and/or payable with respect thereto.

Intellectual Property Asset” means, at the time of determination, any interest (fee, license or otherwise) then owned by any Loan Party in any Intellectual Property.

Intellectual Property Security Agreements” has the meaning set forth in the U.S. Pledge and Security Agreement and the CKI Related Assets Pledge and Security Agreement, as applicable.

Interest Coverage Ratio” means the ratio as of the last day of any Fiscal Quarter of (i) Consolidated Adjusted EBITDA for the four-Fiscal-Quarter period then ended to (ii) Consolidated Cash Interest Expense for such four-Fiscal-Quarter period.

Intercreditor Agreements” means the CKI Intercreditor Agreement and the 2023 Debentures Intercreditor Agreement.



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Interest Payment Date” means with respect to (i) any Loan that is a Base Rate Loan (including any Swing Line Loan), each March 31, June 30, September 30 and December 31 of each year, commencing on the first such date to occur after the Closing Date and the final maturity date of such Loan; and (ii) any Loan that is a Eurocurrency Rate Loan, the last day of each Interest Period applicable to such Loan; provided, that in the case of each Interest Period of longer than three (3) months “Interest Payment Date” shall also include each date that is three (3) months, or an integral multiple thereof, after the commencement of such Interest Period.  

Interest Period” means, in connection with a Eurocurrency Rate Loan, an interest period of one-, two-, three- or six-months (or, if available to all of the Lenders, nine or twelve months and for the first twenty-eight (28) days following the Closing Date, such other period as the Administrative Agent and the Borrower Representative shall agree), as selected by the Borrowers in the applicable Borrowing Notice or Conversion/Continuation Notice, (i) initially, commencing on the Credit Date or Conver­sion/Continuation Date thereof, as the case may be; and (ii) thereafter, commencing on the day on which the immediately preceding Interest Period expires; provided, that (a) if an Interest Period would otherwise expire on a day that is not a Business Day, such Interest Period shall expire on the next succeeding Business Day unless no further Business Day occurs in such month, in which case such Interest Period shall expire on the immediately preceding Business Day; (b) any Interest Period in respect of a Eurocurrency Rate Loan 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, subject to clauses (c) and (d), of this definition, end on the last Business Day of a calendar month; (c) no Interest Period with respect to any portion of any Class of Term Loans shall extend beyond such Class’s Term Loan Maturity Date; and (d) no Interest Period with respect to any portion of any Class of Revolving Loans shall extend beyond such Class’s Revolving Commitment Termination Date.

Interest Rate Agreement” means any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedging agreement  or other similar agreement or arrangement, each of which is for the purpose of hedging the interest rate exposure associated with the operations of the Group and not for speculative purposes.

Interest Rate Determination Date” means, with respect to any Interest Period, the date that is two (2) Business Days prior to the first day of such Interest Period.

Internal Revenue Code” means the Internal Revenue Code of 1986, as amended to the date hereof and from time to time hereafter, and any successor statute.

Investment” means (i) any direct or indirect purchase or other acquisition by any Group Member of, or of a beneficial interest in, any of the Securities of any other Person (other than a Loan Party); (ii) any direct or indirect loan, advance (other than advances to employees for moving, entertainment and travel expenses, drawing accounts and similar expenditures in the ordinary course of business) or capital contributions by any Group Member to any other Person (other than a Loan Party), including all Indebtedness and accounts receivable from that other Person that are not current assets or did not arise from sales to that other Person in the ordinary course of business and (iii) all investments consisting of any exchange traded or over the counter derivative transaction, including any Interest Rate Agreement and Currency Agreement, whether



39






entered into for hedging or speculative purposes.  The amount of any Investment of the type described in clauses (i) and (ii) shall be the original cost of such Investment plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write-ups, write-downs or write-offs with respect to such Investment.

Issuance Notice” means a notice substantially in the form of Exhibit A-3.

Issuing Bank” means each of Barclays Bank PLC, Bank of America, N.A., JPMorgan Chase Bank, N.A. and Fortis Bank (Nederland) N.V., as Issuing Bank hereunder and any other Lender that has notified the Administrative Agent that it has agreed to a request by the Borrower Representative to become an Issuing Bank hereunder with respect to U.S. Letters of Credit, Foreign Letters of Credit or Canadian Letters of Credit, as applicable, together with their respective permitted successors and assigns in such capacity. Unless otherwise specified, in respect of any Letters of Credit, “Issuing Bank” shall refer to the applicable Issuing Bank which has issued such Letter of Credit. An Issuing Bank may perform its obligations hereunder through any applicable branch thereof and such branch shall be treated as the applicable Issuing Bank where applicable.

Itochu Agreement” means that certain Stockholders’ Agreement, dated as of December 27, 2007, among ITOCHU Corporation, Tommy Hilfiger Group B.V., Tommy Hilfiger Japan Corporation and certain other parties signatory thereto.

Itochu Amount” means, for any period, the payments paid or payable by any Group Member for such period pursuant to the Itochu Agreement.

Itochu Guarantee” means that certain Guarantee, dated as of January 23, 2008, by Fortis Bank (Nederland) N.V. of certain obligations of Tommy Hilfiger Group B.V. under the Itochu Agreement for the benefit of ITOCHU Corporation.

Itochu Obligations” means all obligations of any nature of any Subsidiary of the U.S. Borrower under or with respect to the Itochu Guarantee, the Itochu Agreement and the preferred shares of Tommy Hilfiger Japan Corporation.

Japanese Yen” means the lawful currency of Japan.

Joinder Agreement” means an agreement substantially in the form of Exhibit J.

Joint Venture” means a joint venture, partnership or other similar arrangement, whether in corporate, partnership or other legal form; provided, that in no event shall any corporate Subsidiary of any Person be considered to be a Joint Venture to which such Person is a party.

Judgment Currency” has the meaning set forth in Section 10.25.

Landlord Consent” means, with respect to any Leasehold Property for which a landlord’s consent is required prior to a Loan Party’s granting of a Mortgage on such Leasehold Property, a letter, certificate or other instrument in writing from the lessor under the related lease, pursuant to which, among other things, the landlord consents to the granting of a Mortgage on



40






such Leasehold Property by the Loan Party tenant, such Landlord Consent to be in form and substance acceptable to the Collateral Agent in its reasonable discretion and sufficient for the Collateral Agent to obtain a Title Policy with respect to such Mortgage.

 “Landlord Personal Property Collateral Access Agreement” means a Landlord Waiver and Consent Agreement substantially in the form of Exhibit I with such amendments or modifications as may be approved by the Collateral Agent.

Leasehold Property” means any leasehold interest of any Loan Party as lessee under any lease of real property, other than any lease with respect to retail store locations and any such leasehold interest designated from time to time by the Collateral Agent in its sole discretion as not being required to be included in the Collateral.

Lender” means each financial institution listed on the signature pages hereto as a Lender, and any other Person that becomes a party hereto pursuant to an Assignment Agreement or a Joinder Agreement.  Unless the context clearly indicates otherwise, the term “Lenders” shall include the Swing Line Lender.

Lender Counterparty” means each Person counterparty to a Hedge Agreement, Cash Management Agreement or Treasury Transaction (who is (or at the time such Hedge Agreement, Cash Management Agreement or Treasury Transaction was entered into, was) a Lender, an Agent or an Affiliate of any thereof (including, for the avoidance of doubt, any Person who is an Agent or a Lender (and any Affiliate thereof) as of the Closing Date but subsequently, whether before or after entering into a Hedge Agreement, Cash Management Agreement or Treasury Transaction, ceases to be an Agent or a Lender, as the case may be).

Letter of Credit” means a U.S. Letter of Credit, a Canadian Letter of Credit and/or a Foreign Letter of Credit, as applicable.  

Letter of Credit Sublimit” means the U.S. Letter of Credit Sublimit, the Canadian Letter of Credit Sublimit or the Foreign Letter of Credit Sublimit, as applicable.

Leverage Ratio” means the ratio as of the last day of any Fiscal Quarter of (i) Consolidated Total Debt as of such day to (ii) Consolidated Adjusted EBITDA for the four-Fiscal-Quarter period ending on such date.

Lien” means any lien, mortgage, pledge, assignment or transfer for security purpose, security interest, charge or similar encumbrance of any kind (including any agreement to give any of the foregoing, any conditional sale or other title (or extended title) retention agreement, and any lease or license in the nature thereof) and any option, trust or other preferential arrangement having the practical effect of any of the foregoing; provided that in no event shall an operating lease or an agreement to sell be deemed to constitute a Lien.

Loan” means a Tranche A Term Loan, a Tranche B Term Loan, a Revolving Loan, a Swing Line Loan and an Incremental Term Loan, which (i) in the case of Loans denominated in Dollars, may be a Base Rate Loan or a Eurocurrency Rate Loan, (ii) in the case of Loans denominated in Euros or an Other Foreign Currency, shall be a Eurocurrency Rate



41






Loan and (iii) in the case of Loans denominated in Canadian Dollars, may be a Canadian Prime Rate Loan or a Eurocurrency Rate Loan.

Loan Document” means any of this Agreement, the Notes, if any, the Security Documents, the Intercreditor Agreements, each Joinder Agreement, any accession or joinder agreement to the 2023 Debentures Intercreditor Agreement, any documents or certificates executed by the Borrowers in favor of any Issuing Bank relating to Letters of Credit, any Ancillary Document, and all other documents, instruments or agreements executed and delivered by a Loan Party for the benefit of any Agent, any Issuing Bank or any Lender in connection herewith on or after the date hereof.

Loan Party” means each Borrower and each Guarantor; provided that each Subsidiary set forth on Schedule 1.01(h) shall be deemed on and after the Closing Date to be a “Loan Party”, a “Guarantor” and a “Foreign Guarantor” for purposes of the provisions contained in Article VI of this Agreement until such Subsidiary becomes a Guarantor hereunder by executing a Counterpart Agreement, upon which execution such Subsidiary shall become a Guarantor.

Management Determination” has the meaning set forth in Section 7.13(f).

Mandatory Costs” means the % rate per annum calculated by the Administrative Agent in accordance with Schedule 1.01(f) hereto.

Margin Stock” has the meaning given in Regulation U of the Board of Governors as in effect from time to time.

Market Disruption” means any Interest Rate Determination Date on which (i) the Administrative Agent shall have determined (which determination shall be final and conclusive and binding upon all parties hereto), with respect to any Eurocurrency Rate Loans, that by reason of circumstances affecting the London interbank market adequate and fair means do not exist for ascertaining the interest rate applicable to such Loans on the basis provided for in the definition of Adjusted Eurocurrency Rate, or (ii) before the close of business in London on such Interest Rate Determination Date, the Administrative Agent receives notifications from a Lender or Lenders (whose aggregate exposure in respect of any Class of Loans exceeds 50% of that Class of Loans)  that the cost to it of obtaining matching deposits in the London interbank market would be in excess of the Adjusted Eurocurrency Rate.  

Material Adverse Effect” means any event, development or circumstance that has had or would reasonably be expected to have a material adverse effect on (i) the business, assets, operations or financial condition of the Group (other than any Securitization Subsidiary) taken as a whole; (ii) the ability of any Loan Party to fully and timely perform its Obligations, (iii) the legality, validity, binding effect or enforceability against the Loan Parties of the Loan Documents in a manner which would be prejudicial to the interests of the Secured Parties taken as a whole; or (iv) the rights and remedies available to, or conferred upon, any Agent and any Lender or any other Secured Party under any Loan Document in any manner that would be prejudicial to the interests of the Secured Parties, taken as a whole.



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Material Companymeans (i) any Loan Party, (ii) any Group Member that is listed in Schedule 1.01(g) or (iii) any Group Member that has (x) Group Member Adjusted EBITDA or (y) Group Member Assets representing, respectively, 5% or more of Consolidated Adjusted EBITDA or Consolidated Total Assets.  For this purpose:

(a)

the (i) Group Member Adjusted EBITDA and (ii) Group Member Assets will be determined from its financial statements upon which the latest audited financial statements of the Group have been based;

(b)

if a Subsidiary becomes a Group Member after the date on which the latest audited financial statements of the Group have been prepared, the (i) Group Member Adjusted EBITDA or (ii) Group Member Assets of that Subsidiary will be determined from its latest financial statements;

(c)

the (i) Consolidated Adjusted EBITDA and (ii) Consolidated Total Assets will be determined from its latest audited financial statements, adjusted (where appropriate), in the case of Consolidated Adjusted EBITDA, taking into account pro forma adjustments of the type described in the definition of “Consolidated Adjusted EBITDA” and, in the case of Consolidated Total Assets, to reflect the assets of any company or business subsequently acquired or disposed of; and

(d)

if a Material Company disposes of all or substantially all of its assets to another Group Member, it will immediately cease to be a Material Company and the other Group Member (if it is not already) will immediately become a Material Company.

 “Material Indebtedness” means Indebtedness (other than the Loans and Letters of Credit or, for the avoidance of doubt, any CKI Obligations) of any one or more of the Borrowers or any Subsidiary in an individual principal amount (or Net Mark-to-Market Exposure) of $50,000,000 or more.

Material Intellectual Property” means any Intellectual Property included in the Collateral that is material to the business of any Group Member.

Material Real Estate Asset” means any Real Estate Asset in respect of which a Loan Party has an ownership interest with a fair market value in excess of $10,000,000 as of the date of the acquisition thereof, but excluding all Leasehold Properties (i) that are retail store locations, (ii) with respect to which the aggregate payments under the terms of the applicable lease are less than $10,000,000 per annum or whose termination dates under the terms of the applicable lease are not greater than 5 years after the date of the acquisition thereof, (iii) that, by the terms of their respective leases are prohibited from, or the respective landlord does not otherwise grant consent to, recording a Record Document, or (iv) with respect to which, notwithstanding the U.S. Borrower’s commercially reasonable efforts to secure a Landlord Consent pursuant to the terms of Section 3.01(g)(3), such Landlord Consent shall not be forthcoming from the applicable Landlord.

 “Moody’s” means Moody’s Investor Services, Inc.



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Mortgage” means one or more instruments of mortgage or leasehold mortgage substantially in the form of Exhibit H, as it may be amended, restated, supplemented or otherwise modified from time to time.

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

NAIC” means The National Association of Insurance Commissioners, and any successor thereto.

Narrative Report” means, with respect to the financial statements for which such narrative report is required, a narrative report describing the operations of the Group for the applicable Fiscal Quarter or Fiscal Year and for the period from the beginning of the then current Fiscal Year to the end of such period to which such financial statements relate.

Net Assets” has the meaning set forth in Section 7.13(h).

Net Cash Proceeds” means (a) with respect to any Asset Sale, an amount equal to:  (i) cash payments (including any cash received by way of deferred payment pursuant to, or by monetization of, a note receivable or otherwise, but only as and when so received) received by any Group Member from such Asset Sale, minus (ii) any bona fide direct costs incurred in connection with such Asset Sale, including (1) taxes paid or payable as a result thereof including transfer taxes and income or gains taxes payable as a result of any gain recognized in connection with such Asset Sale, (2) payment of the outstanding principal amount of, premium or penalty, if any, and interest on any Indebtedness (other than the Loans) that is secured by a Lien on the stock or assets in question and that is required to be repaid under the terms thereof as a result of such Asset Sale, (3) a reasonable reserve established in accordance with GAAP retained by the applicable Group Member, including, without limitation for any indemnification payments (fixed or contingent) attributable to seller’s indemnities and representa­tions and warranties to purchaser in respect of such Asset Sale undertaken by any Group Member in connection with such Asset Sale, (4) attorneys’ fees, accountants’ fees, investment banking fees, survey costs, title insurance premiums and related search and recording charges, transfer taxes, deed or mortgage recording taxes, other customary expenses and brokerage, consultant and other customary fees incurred in connection therewith and (5) in case of any such Asset Sale occurring in a jurisdiction other than the United States, the amount of all taxes paid (or reasonably estimated to be payable) by the Group Members that are directly attributable to the distribution of such cash proceeds from such jurisdiction or to the repatriation of such cash proceeds into the United States or The Netherlands, but only to the extent the Group Members have used commercially reasonable efforts to reduce or eliminate such taxes, including by electing to prepay Loans in such a manner that would result in the lowest possible amount of such taxes; (b) (i) any cash payments or proceeds received by any Group Member (1) under any casualty insurance policy in respect of a covered loss thereunder or (2) as a result of the taking of any assets of any Group Member by any Person pursuant to the power of eminent domain, condemnation or otherwise, or pursuant to a sale of any such assets to a purchaser with such power under threat of such a taking, minus (ii) (1) any actual and reasonable costs incurred by any Group Member in connection with the adjustment or settlement of any claims of such Group Member in respect thereof, (2) any bona fide direct costs incurred in connection with any sale of such assets as referred to in preceding



44






clause (i)(2), including income taxes payable as a result of any gain recognized in connection therewith and (3) in case of any such event occurring in a jurisdiction other than the United States, the amount of all taxes paid (or reasonably estimated to be payable) by the Group Members that are directly attributable to the distribution of such cash proceeds from such jurisdiction or to the repatriation of such cash proceeds into the United States or The Netherlands, but only to the extent the Group Members have used commercially reasonable efforts to reduce or eliminate such taxes, including by electing to prepay Loans in such a manner that would result in the lowest possible amount of such taxes; (c) with respect to any issuance or incurrence of Indebtedness (other than in connection with a Qualified Securitization Financing) or any sale of Equity Interests, the cash proceeds thereof, net of underwriting discounts and commissions and other reasonable costs and expenses associated therewith, including reasonable legal fees and expenses; and (d) with respect to any issuance or incurrence of Indebtedness in connection with a Qualified Securitization Financing, the cash proceeds thereof, net of any related Securitization Fees and other reasonable costs and expenses associated therewith, including reasonable legal fees and expenses, received directly or indirectly from time to time in connection with such Qualified Securitization Financing from Persons that are not Securitization Subsidiaries, including any such cash proceeds received in connection with an increase in the outstanding program or facility amount with respect to such Qualified Securitization Financing, but excluding any cash collections from the Securitization Assets backing such Qualified Securitization Financing that are reinvested (or deemed to be reinvested) by such Persons in additional Securitization Assets without any increase in the Indebtedness outstanding in connection with such Qualified Securitization Financing.

Net Mark-to-Market Exposure” of a Person means, as of any date of determination, the excess (if any) of all unrealized losses over all unrealized profits of such Person arising from Hedge Agreements or other Indebtedness of the type described in clause (viii) of the definition thereof.  As used in this definition, “unrealized losses” means the fair market value of the cost to such Person of replacing such Hedge Agreement or such other Indebtedness as of the date of determination (assuming the Hedge Agreement or such other Indebtedness were to be terminated as of that date), and “unrealized profits” means the fair market value of the gain to such Person of replacing such Hedge Agreement or such other Indebtedness as of the date of determination (assuming such Hedge Agreement or such other Indebtedness were to be terminated as of that date).

Non-Consenting Lender” has the meaning set forth in Section 2.23.

Non-Public Information” means information which has not been disseminated in a manner making it available to investors generally, within the meaning of Regulation FD.

Non-U.S. Lender” has the meaning set forth in Section 2.20(c).

Note” means a Tranche A Term Loan Note, a Tranche B Term Loan Note, an Incremental Term Loan Note, a Revolving Loan Note or a Swing Line Note.

Notice” means a Borrowing Notice, an Issuance Notice, or a Conversion/ Continuation Notice.



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Obligations” means all obligations of every nature of each Loan Party, including obligations from time to time owed to Secured Parties, under any Loan Document, Hedge Agreement, Cash Management Agreement or Treasury Transaction whether for principal, interest (including interest which, but for the filing of a petition in bankruptcy with respect to such Loan Party, would have accrued on any Obligation, whether or not a claim is allowed against such Loan Party for such interest in the related bankruptcy proceeding), reimbursement of amounts drawn under Letters of Credit, payments for early termination of Hedge Agreements, fees, expenses, indemnification or otherwise.

Offer” has the meaning set forth in Section 2.13(c).

Offer Loans” has the meaning set forth in Section 2.13(c).

Organizational Documents” means with respect to any Person all formation, organizational and governing documents, instruments and agreements, including (i) with respect to any corporation, its certificate or articles of incorporation or organization, its by-laws, any memorandum of incorporation or other constitutional documents, (ii) with respect to any limited partnership, its certificate of limited partnership and its partnership agreement, (iii) with respect to any general partnership, its partnership agreement and (iv) with respect to any limited liability company, its certificate of incorporation or formation (and any amendments thereto), certificate of incorporation on change of name (if any), its memorandum and articles of association (if any), its articles of organization (if any), the shareholders’ list (if any) and its limited liability company agreement or operating agreement.  In the event any term or condition of this Agreement or any other Loan Document requires any Organizational Document to be certified by a secretary of state or similar governmental official, the reference to any such “Organizational Document” shall only be to a document of a type customarily certified by such governmental official.

Other Foreign Currencies” means Japanese Yen and Pounds Sterling.

Other Taxes” means any and all present or future stamp or documentary Taxes or any other excise or property Taxes, charges or similar levies (and interest, fines, penalties and additions related thereto) arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document.

Parallel Debt” means, in respect of a Loan Party, its Foreign Parallel Debt or its U.S. Parallel Debt.

Participant Register” has the meaning set forth in Section 10.06(g)(iv).

Patents” has the meaning set forth in the U.S. Pledge and Security Agreement.

PATRIOT Act” has the meaning set forth in Section 3.01(u).  

Payment in Full or Paid in Full” means the payment in full of all Obligations (other than obligations under Hedge Agreements, Cash Management Agreements or Treasury Transactions not yet due and payable and contingent obligations not yet due and payable) and



46






cancellation, expiration or Cash Collateralization of all Letters of Credit and termination of all Commitments to lend under this Agreement.

PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan, which is subject to Section 412 or Section 430 of the Internal Revenue Code or Section 302 or Section 303 of ERISA.

Perfection Certificate” means a certificate in form satisfactory to the Collateral Agent that provides information with respect to the personal or mixed property of each U.S. Loan Party.

Permitted Acquisition” means any acquisition by the U.S. Borrower and/or any of its Wholly-Owned Restricted Subsidiaries of, or any transaction that results in the U.S. Borrower and/or any of its Wholly-Owned Restricted Subsidiaries owning, whether by purchase, merger, exclusive inbound license, transfer of rights under Copyright or otherwise, all or substantially all of the assets of, all of the Equity Interests of, or a business line or unit or a division of, any Person; provided, that:

(a)

immediately prior to, and after giving effect thereto, no Default or Event of Default shall have occurred and be continuing or would result therefrom;

(b)

all transactions in connection therewith shall be consummated, in all material respects, in accordance with all applicable laws and in conformity with all applicable Governmental Authorizations;

(c)

in the case of the acquisition of Equity Interests, all of the Equity Interests (except for any such Securities in the nature of directors’ qualifying shares required pursuant to applicable law) acquired or otherwise issued by such Person or any newly formed Subsidiary of the U.S. Borrower in connection with such acquisition shall be owned 100.0% by the Loan Parties;

(d)

the Group shall be in compliance with the financial covenants set forth in Section 6.07(a) and (b) on a pro forma basis after giving effect to such acquisition as of the last day of the Fiscal Quarter most recently ended;

(e)

the acquisition shall not result in the Group acquiring any interest, direct or indirect, in any Loan; and

(f)

in the case of an acquisition involving consideration in excess of $25,000,000, the Borrower Representative shall have delivered to the Administrative Agent at least five (5) Business Days prior to such acquisition, a Compliance Certificate evidencing compliance with Sections 6.07(a) and 6.07(b) as required under clause (d) above.

Permitted Capital Expenditure Amount” has the meaning set forth in Section 6.07(c).   



47






Permitted Liens” means each of the Liens permitted pursuant to Section 6.02.

Permitted Refinancing” means, with respect to any Person, any modification, refinancing, refunding, renewal or extension of any Indebtedness of such Person; provided, that (i) 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 or extended except by an amount equal to unpaid accrued interest and premium thereon plus other reasonable amounts paid, and fees and expenses reasonably incurred, in connection with such modification, refinancing, refunding, renewal or extension and by an amount equal to any existing commitments unutilized thereunder; (ii) (A) such modification, refinancing, refunding, renewal or extension has a final maturity date equal to or later than the earlier of (x) the final maturity date of the Indebtedness being modified, refinanced, refunded, renewed or extended and (y) the date that is 90 days after the final maturity date of the Term Loans, and (B) has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of, the earlier of (x) the Indebtedness being modified, refinanced, refunded, renewed or extended and (y) the Term Loans; (iii) at the time thereof, no Default or Event of Default shall have occurred and be continuing; (iv) to the extent such Indebtedness being modified, refinanced, refunded, renewed or extended is subordinated in right of payment to the Obligations, such modification, refinancing, refunding, renewal or extension is subordinated in right of payment to the Obligations on terms at least as favorable to the Lenders as those contained in the documentation governing the Indebtedness being modified, refinanced, refunded, renewed or extended and (v) the obligors in respect of such Indebtedness being modified, refinanced, refunded, renewed or extended are the obligors thereon and to the extent an additional obligor would otherwise be permitted to incur such Indebtedness under another provision of Section 6.01, such additional obligor may be an obligor thereon.

Permitted Sale and Lease-Back” has the meaning set forth in Section 6.10.

Person” means and includes natural persons, corporations, limited partnerships, general partnerships, limited liability companies, limited liability partnerships, joint stock companies, Joint Ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts or other organizations, whether or not legal entities, and Governmental Authorities.

Platform” has the meaning set forth in Section 5.01(n).

Pounds Sterling” means the lawful currency of the United Kingdom.

Prime Rate” means the rate of interest publicly announced from time to time by the Administrative Agent as its prime rate in effect at its principal office in New York City.  The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer.  The Administrative Agent or any other Lender may make commercial loans or other loans at rates of interest at, above or below the Prime Rate.

Principal Office” means, for each of the Administrative Agent, each Swing Line Lender and each Issuing Bank, such Person’s “Principal Office” which, in the case of the Administrative Agent, may include one or more separate offices with respect to Approved



48






Currencies as set forth on Schedule 1.01(d), or such other office or office of a third party or sub-agent, as appropriate, as such Person may from time to time designate in writing to the Borrowers, the Administrative Agent and each Lender.

Projections” has the meaning set forth in Section 4.08.

Pro Rata Share” means (i) with respect to all payments, computations and other matters relating to the Tranche A Term Loans of any Lender, as the context requires, the percentage obtained by dividing (x) (1) the U.S. Tranche A Term Loan Exposure of that Lender by (2) the aggregate U.S. Tranche A Term Loan Exposure of all Lenders or (y) (1) the Foreign Tranche A Term Loan Exposure of that Lender by (2) the aggregate Foreign Tranche A Term Loan Exposure of all Lenders; (ii) with respect to all payments, computations and other matters relating to all of the Tranche B Term Loans of any Lender, as the context requires, the percentage obtained by dividing (x) (1) the U.S. Tranche B Term Loan Exposure of that Lender by (2) the aggregate U.S. Tranche B Term Loan Exposure of all Lenders or (y) (1) the Foreign Tranche B Term Loan Exposure of that Lender by (2) the aggregate Foreign Tranche B Term Loan Exposure of all Lenders; (iii) with respect to all payments, computations and other matters relating to the Revolving Commitment or Revolving Loans of any Lender or any Letters of Credit issued or participations purchased therein by any Lender or any participations in any Swing Line Loans purchased by any Lender, as the context requires, the percentage obtained by dividing (x) (1) the U.S. Revolving Exposure of that Lender by (2) the aggregate U.S. Revolving Exposure of all Lenders, (y) (1) the Foreign Revolving Exposure of that Lender by (2) the aggregate Foreign Revolving Exposure of all Lenders or (z) (1) the Canadian Revolving Exposure of that Lender by (2) the aggregate Canadian Revolving Exposure of all Lenders; and (iv) with respect to all payments, computations, and other matters relating to Incremental Term Loan Commitments or Incremental Term Loans of a particular Series, the percentage obtained by dividing (x) the Incremental Term Loan Exposure of that Lender with respect to that Series by (y) the aggregate Incremental Term Loan Exposure of all Lenders with respect to that Series.  For all other purposes with respect to each Lender, “Pro Rata Share” means the percentage obtained by dividing (i) an amount equal to the sum of the Tranche A Term Loan Exposure, the Tranche B Term Loan Exposure, the Revolving Exposure and the Incremental Term Loan Exposure of that Lender, by (ii) an amount equal to the sum of the aggregate Tranche A Term Loan Exposure, the aggregate Tranche B Term Loan Exposure, the aggregate Revolving Exposure and the aggregate Incremental Term Loan Exposure of all Lenders.

Qualified Securitization Financing” means any transaction or series of transactions entered into by a Group Member  pursuant to which such Group Member, sells, conveys, contributes, assigns, grants an interest in or otherwise transfers to a Securitization Subsidiary, Securitization Assets (and/or grants a security interest in such Securitization Assets transferred or purported to be transferred to such Securitization Subsidiary), and which Securitization Subsidiary funds the acquisition of such Securitization Assets (i) with cash, (ii) through the issuance to such Group Member of Seller’s Retained Interests or an increase in such Seller’s Retained Interests, and/or (iii) with proceeds from the sale, pledge or collection of Securitization Assets.

RBC has the meaning specified in the preamble hereto.



49






Real Estate Asset” means, at any time of determination, any interest (fee or leasehold) then owned by any Loan Party in any real property.

Record Document” means, with respect to any Leasehold Property, (i) the lease evidencing such Leasehold Property or a memorandum thereof, executed and acknowledged by the owner of the affected real property, as lessor, or (ii) if such Leasehold Property was acquired or subleased from the holder of a Recorded Leasehold Interest, the applicable assignment or sublease document, executed and acknowledged by such holder, in each case in form sufficient to give such constructive notice upon recordation and otherwise in form reasonably satisfactory to the Collateral Agent.

Recorded Leasehold Interest” means a Leasehold Property with respect to which a Record Document has been recorded in all places necessary or desirable, in the Collateral Agent’s reasonable judgment, to give constructive notice of such Leasehold Property to third-party purchasers and encumbrances of the affected real property.

Refunded Swing Line Loans” has the meaning set forth in Section 2.03(b)(iv).

Register” has the meaning set forth in Section 2.07(b).

Regulation” has the meaning set forth in Section 4.23.

Regulation D” means Regulation D of the Board of Governors, as in effect from time to time.

Regulation FD” means Regulation FD as promulgated by the SEC under the Securities Act and Exchange Act.

Regulation U” means Regulation U of the Board of Governors, as in effect from time to time.

Reimbursement Date” has the meaning set forth in Section 2.04(d)(i).

Related Fund” means, with respect to any Lender that is an investment fund, any other investment fund that invests in commercial loans and that is managed or advised by the same investment advisor as such Lender or by an Affiliate of such investment advisor.

Release” means any release, spill, emission, leaking, pumping, pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching or migration of any Hazardous Material into the indoor or outdoor environment (including the abandonment or disposal of any barrels, containers or other closed receptacles containing any Hazardous Material), including the movement of any Hazardous Material through the air, soil, surface water or groundwater.

Relevant Jurisdiction” means, in relation to a Loan Party: (i) its jurisdiction of organization; (ii) any jurisdiction where any asset subject to or intended to be subject to the Security Documents to be created by it is situated; and (iii) any jurisdiction where it conducts its business.



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Relevant Restrictive Covenants” has the meaning set forth in Section 6.16(a).

Replacement Lender” has the meaning set forth in Section 2.23.

Required Lenders” means one or more Lenders having or holding Tranche A Term Loan Exposure, Tranche B Term Loan Exposure, Incremental Term Loan Exposure and/or Revolving Exposure and representing more than 50.0% of the sum of (i) the aggregate Tranche A Term Loan Exposure of all Lenders, (ii) the aggregate Tranche B Term Loan Exposure of all Lenders, (iii) the aggregate Revolving Exposure of all Lenders and (iv) the aggregate Incremental Term Loan Exposure of all Lenders.

Required Prepayment Date” has the meaning set forth in Section 2.15(c).

Restricted Payment” means (i) any dividend or other distribution, direct or indirect, on account of any shares of any class of stock of any Group Member now or hereafter outstanding, except a dividend payable solely in shares of Equity Interests (other than Disqualified Equity Interests); (ii) any redemption, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any shares of any class of stock of any Group Member now or hereafter outstanding, except any such payment, purchase or acquisition payable solely in shares of Equity Interests (other than Disqualified Equity Interests); (iii) any payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire shares of any class of stock of any Group Member now or hereafter outstanding, (iv) any payment or prepayment of principal of, premium, if any, or interest on, or redemption, purchase, retirement, defeasance (including in-substance or legal defeasance), sinking fund or similar payment with respect to, the 2020 Notes and (v) any payment or prepayment of principal of, premium, if any, or interest on, or redemption, purchase, retirement or similar payment with respect to Subordinated Indebtedness (other than if such Subordinated Indebtedness is owed by the U.S. Borrower to any Restricted Subsidiary or owed by any Restricted Subsidiary to the U.S. Borrower or any other Restricted Subsidiary and, with respect to amounts owing to Restricted Subsidiaries that are not Loan Parties, in the ordinary course of business).

Restricted Subsidiary” means any Subsidiary of the U.S. Borrower other than an Unrestricted Subsidiary.

Revolving Commitment” means a U.S. Revolving Commitment, a Canadian Revolving Commitment and/or a Foreign Revolving Commitment, as applicable.

Revolving Commitment Period” means the U.S. Revolving Commitment Period, the Canadian Revolving Commitment Period or the Foreign Revolving Commitment Period, as applicable.

Revolving Commitment Termination Date” means the U.S. Revolving Commitment Termination Date, the Canadian Revolving Commitment Termination Date or the Foreign Revolving Commitment Termination Date, as applicable.



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Revolving Exposure” means, with respect to any Lender as of any date of determination, the sum of such Lender’s U.S. Revolving Exposure, Canadian Revolving Exposure and Foreign Revolving Exposure.

Revolving Loan” means a U.S. Revolving Loan, a Canadian Revolving Loan and/or a Foreign Revolving Loan, as applicable.  

Revolving Loan Note” means a promissory note substantially in the form of Exhibit B-3, as it may be amended, restated, supplemented or otherwise modified from time to time.

S&P” means Standard & Poor’s, a Division of The McGraw-Hill Companies, Inc.

Sale and Lease-Back” has the meaning set forth in Section 6.10.

Screen Rate” means, in relation to a Loan denominated in Dollars or Other Foreign Currency, the British Bankers’ Association Interest Settlement Rate for the relevant currency and Interest Period, in relation to a Loan denominated in Canadian Dollars, the British Bankers’ Association Canadian Dollar Rate for the relevant Interest Period and in relation to a Loan denominated in Euros, the percentage rate per annum determined by the Banking Federation of the European Union for the relevant period, in each case, displayed on the appropriate page of the Reuters screen. If the agreed page is replaced or service ceases to be available, the Administrative Agent may specify another page or service displaying the appropriate rate.

SEC” means the United States Securities and Exchange Commission and any successor Governmental Authority performing a similar function.

Secured Parties” means the Agents, Lenders, Issuing Banks, the Lender Counterparties and the Ancillary Lenders and shall include, without limitation, all former Agents, Lenders, Issuing Banks, Lender Counterparties and Ancillary Lenders to the extent that any Obligations owing to such Persons were incurred while such Persons were Agents, Lenders, Issuing Banks, Lender Counterparties or Ancillary Lenders and such Obligations have not been paid or satisfied in full.

Securities” means any stock, shares, partnership interests, voting trust certificates, certificates of interest or participation in any profit-sharing agreement or arrangement, options, warrants, bonds, debentures, notes, or other evidences of Indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as “securities” or any certificates of interest, shares or participations in temporary or interim certificates for the purchase or acquisition of, or any right to subscribe to, purchase or acquire, any of the foregoing.

Securities Act” means the Securities Act of 1933, as amended from time to time, and any successor statute.



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Securitization Assets” means any accounts receivable owed to a Group Member (whether now existing or arising or acquired in the future) arising in the ordinary course of business from the sale of goods or services, all collateral securing such accounts receivable, all contracts and contract rights and all guarantees or other obligations in respect of such accounts receivable, all proceeds of such accounts receivable and other assets (including contract rights) which are of the type customarily transferred or in respect of which security interests are customarily granted in connection with securitizations of accounts receivable and which are sold, conveyed, contributed, assigned, pledged or otherwise transferred by such Group Member to a Securitization Subsidiary.

Securitization Fees” means, with respect to any Qualified Securitization Financing, distributions or payments made, or fees paid, directly or by means of discounts with respect to any Indebtedness issued or sold in connection with such Qualified Securitization Financing, to a Person that is not a Securitization Subsidiary in connection with such Qualified Securitization Financing.

Securitization Repurchase Obligation” means any obligation of a seller of Securitization Assets in a Qualified Securitization Financing to repurchase Securitization Assets arising as a result of a breach of a representation, warranty or covenant with respect to such Securitization Assets, including as a result of a receivable or portion thereof becoming subject to any asserted defense, dispute, off set, counterclaim or other dilution of any kind as a result of any action taken by, any failure to take action by or any other event relating to the seller, but in each case, not as a result of such receivable being or becoming uncollectible for credit reasons.

 “Securitization Subsidiary” means a wholly owned Subsidiary of the U.S. Borrower (or another Person formed for the purposes of engaging in a Qualified Securitization Financing in which any Group Member makes an Investment and to which such Group Member transfers, contributes, sells, conveys or grants a security interest in Securitization Assets) that engages in no activities other than in connection with the acquisition and/or financing of Securitization Assets of the Group, all proceeds thereof and all rights (contingent and other), collateral and other assets relating thereto, and any business or activities incidental or related to such business, and which is designated by the Board of Directors of the U.S. Borrower (or a duly authorized committee thereof) or such other Person (as provided below) as a Securitization Subsidiary and (a) no portion of the Indebtedness or any other obligations (contingent or otherwise) of which (i) is guaranteed by any Group Member, other than another Securitization Subsidiary (excluding guarantees of obligations (other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization Undertakings), (ii) is recourse to or obligates any Group Member, other than another Securitization Subsidiary, in any way other than pursuant to Standard Securitization Undertakings or (iii) subjects any property or asset (other than Securitization Assets) of any Group Member, other than another Securitization Subsidiary, directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant to Standard Securitization Undertakings, (b) with which no Group Member, other than another Securitization Subsidiary, has any material contract, agreement, arrangement or understanding other than (i) the applicable receivables purchase agreements and related agreements, in each case, having reasonably customary terms, or (ii) on terms which the U.S. Borrower reasonably believes to be no less favorable to the applicable Group Member than those that might be obtained at the time from Persons that are not Affiliates of the Group and (c) to which no Group



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Member other than another Securitization Subsidiary, has any obligation to maintain or preserve such entity’s financial condition or cause such entity to achieve certain levels of operating results.  Any such designation by the Board of Directors of the U.S. Borrower (or a duly authorized committee thereof) or such other Person shall be evidenced to the Administrative Agent by delivery to the Administrative Agent of a certified copy of the resolution of the Board of Directors of the U.S. Borrower (or a duly authorized committee thereof) or such other Person giving effect to such designation and a certificate executed by an Authorized Officer certifying that such designation complied with the foregoing conditions.

 “Security Documents” means the U.S. Security Agreements, the Mortgages, the Intellectual Property Security Agreements, the Landlord Personal Property Collateral Access Agreements, if any, each Foreign Law Security Document, if any, and all other instruments, documents and agreements delivered by any Loan Party pursuant to this Agreement or any of the other Loan Documents in order to grant to the Collateral Agent, for the benefit of Secured Parties, a Lien on any assets or property of that Loan Party as security for all or certain of the Obligations, including UCC financing statements and amendments thereto and filings with the United States Patent and Trademark Office and the United States Copyright Office.

Seller” has the meaning specified in the recitals hereto.

Seller BVI” has the meaning specified in the recitals hereto.

Seller’s Retained Interest” means the debt or equity interests held by any Group Member in a Securitization Subsidiary to which Securitization Assets have been transferred, including any such debt or equity received as consideration for or as a portion of the purchase price for the Securitization Assets transferred, or any other instrument through such Group Member has rights to or receives distributions in respect of any residual or excess interest in the Securitization Assets.

Series” has the meaning set forth in Section 2.24.

Series A Preferred Stock” means the Series A Convertible Preferred Stock of the U.S. Borrower issued and outstanding as of the Closing Date.

Software” means computer software of whatever kind or purpose, including code, tools, developers kits, utilities, graphical user interfaces, menus, images, icons, and forms, and all software stored or contained therein or transmitted thereby, and related documentation.

Solvency Certificate” means a Solvency Certificate of the principal financial officer of the Borrower Representative substantially in the form of Exhibit E-2.

Solvent” means, with respect to the Group on a consolidated basis, that as of the date of determination, (a) the sum of such Group’s debt (including contingent liabilities) does not exceed the present fair saleable value of such Group’s present assets; (b) such Group’s capital is not unreasonably small in relation to its business as of the date of determination; and (c) such Group has not incurred and does not intend to incur, or believe (nor should it reasonably believe) that it will incur, debts beyond its ability to pay such debts as they become due (whether at maturity or otherwise).  For purposes of this definition, the amount of any contingent liability at



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any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability (irrespective of whether such contingent liabilities meet the criteria for accrual under Statement of Financial Accounting Standard No. 5).

 “Standard Securitization Undertakings” means representations, warranties, covenants, Securitization Repurchase Obligations and indemnities entered into by any Group Member that are reasonably customary in accounts receivable securitization transactions.

Subordinated Foreign Intercompany Obligations” has the meaning set forth in Section 7.07(b).

Subordinated Indebtedness” means, with respect to the Obligations, any Indebtedness of any Loan Party that is by its terms subordinated in right of payment to any of the Obligations.

Subordinated U.S. Intercompany Obligations” has the meaning set forth in Section 7.07(a).

 “Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, association, joint venture or other business entity of which more than 50.0% of the total voting power of shares of stock or other ownership interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Person or Persons (whether directors, managers, trustees or other Persons performing similar functions) having the power to direct or cause the direction of the management and policies thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof; provided, that in determining the percentage of ownership interests of any Person controlled by another Person, no ownership interest in the nature of a “qualifying share” of the former Person shall be deemed to be outstanding; provided, further, that for purposes of Article IV and V, no Securitization Subsidiary shall be considered a Subsidiary of the U.S. Borrower; provided, further, that, notwithstanding anything contained herein or otherwise, for purposes of this Agreement and any other Loan Document, the CKI Trust shall not be considered a Subsidiary of the U.S. Borrower; and provided, further, that unless the context otherwise requires, a Subsidiary shall mean a direct or indirect Subsidiary of the U.S. Borrower.

Swing Line Lender” means each of the Canadian Swing Line Lender and the U.S. Swing Line Lender.  

Swing Line Loan” means a Canadian Swing Line Loan or a U.S. Swing Line Loan, as applicable.

Swing Line Note” means a promissory note substantially in the form of Exhibit B-4, as it may be amended, restated, supplemented or otherwise modified from time to time.

Syndication Agent” has the meaning set forth in the preamble.



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Tax” means any present or future tax, levy, impost, duty, assessment, charge, fee, deduction or withholding (and interest, fines, penalties and additions related thereto) of any nature and whatever called, by whomsoever, on whomsoever and wherever imposed, levied, collected, withheld or assessed.

Term Lenders” means the Lenders having Tranche A Term Loan Exposure, Tranche B Exposure and Incremental Term Loan Exposure of each applicable Series.

Term Loan” means a Tranche A Term Loan, a Tranche B Term Loan and an Incremental Term Loan.

Term Loan Commitment” means the Tranche A Term Loan Commitment, the Tranche B Term Loan Commitment or the Incremental Term Loan Commitment of a Lender, and “Term Loan Commitments” means such commitments of all Lenders.

Term Loan Maturity Date” means the Tranche A Term Loan Maturity Date, the Tranche B Term Loan Maturity Date and the Incremental Term Loan Maturity Date of any Series of Incremental Term Loans.

Terminated Lender” has the meaning set forth in Section 2.23.

TH Acknowledgment and Consent” means that certain Irrevocable Acknowledgment and Consent Agreement dated as of May 8, 2006 among Mr. Tommy Hilfiger, Tommy Hilfiger Licensing LLC, Tommy Hilfiger U.S.A., Inc. and Elmira (BVI) Unlimited (as the same shall have been amended, restated, supplemented or modified prior to the Closing Date).

TH Documents” means the TH Employment Agreements and the TH Acknowledgment and Consent.

TH Employment Agreements” means (i) that certain Amended and Restated Employment Agreement dated as of May 9, 2006 between Tommy Hilfiger U.S.A., Inc. and Mr. Tommy Hilfiger (as the same shall have been amended, restated, supplemented or modified prior to the Closing Date) and (ii) that certain Employment Agreement dated as of May 9, 2006 between the Acquired Business and Mr. Tommy Hilfiger (as the same shall have been amended, restated, supplemented or modified prior to the Closing Date).

Title Company” has the meaning set forth in Section 3.01(g)(4).

Title Policy” has the meaning set forth in Section 3.01(g)(4).

Total Utilization of Canadian Revolving Commitments” means, as at any date of determination, the Dollar Equivalent of the sum of (i) the aggregate principal amount of all outstanding Canadian Revolving Loans (other than Canadian Revolving Loans made for the purpose of repaying any Refunded Swing Line Loans or reimbursing the applicable Issuing Bank for any amount drawn under any Canadian Letter of Credit, but not yet so applied), (ii) the aggregate principal amount of all outstanding Canadian Swing Line Loans and (iii) the Canadian Letter of Credit Usage.



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Total Utilization of Foreign Revolving Commitmentsmeans, as at any date of determination, the Euro Equivalent of the sum of (i) the aggregate principal amount of all outstanding Foreign Revolving Loans (other than Foreign Revolving Loans made for the purpose of reimbursing the applicable Issuing Bank for any amount drawn under any Foreign Letter of Credit, but not yet so applied) and (ii) the Foreign Letter of Credit Usage.

Total Utilization of U.S. Revolving Commitments” means, as at any date of determination, the Dollar Equivalent of the sum of (i) the aggregate principal amount of all outstanding U.S. Revolving Loans (other than U.S. Revolving Loans made for the purpose of repaying any Refunded Swing Line Loans or reimbursing the applicable Issuing Bank for any amount drawn under any U.S. Letter of Credit, but not yet so applied), (ii) the aggregate principal amount of all outstanding U.S. Swing Line Loans and (iii) the U.S. Letter of Credit Usage.

Total Utilization of Revolving Commitments” means, as at any date of determination, the sum of (i) the Total Utilization of U.S. Revolving Commitments, (ii) the Total Utilization of Canadian Revolving Commitments and (iii) the Total Utilization of Foreign Revolving Commitments.

Trademarks” has the meaning set forth in the U.S. Pledge and Security Agreement.

Tranche A Term Loan” means a U.S. Tranche A Term Loan and/or a Foreign Tranche A Term Loan, as applicable.

Tranche A Term Loan Commitment” means a U.S. Tranche A Term Loan Commitment and/or a Foreign Tranche A Term Loan Commitment, as applicable.  

Tranche A Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the sum of such Lender’s Foreign Tranche A Term Loan Exposure and U.S. Tranche A Term Loan Exposure.

Tranche A Term Loan Maturity Date” means the earlier of (i) the fifth anniversary of the Closing Date and (ii) with respect to the Foreign Tranche A Term Loans or the U.S. Tranche A Term Loans, as applicable, the date on which all such Tranche A Term Loans shall become due and payable in full hereunder, whether by acceleration or otherwise.

Tranche A Term Loan Note” means a promissory note substantially in the form of Exhibit B-1, as it may be amended, restated, supplemented or otherwise modified from time to time.

Tranche B Term Loan” means a U.S. Tranche B Term Loan and/or a Foreign Tranche B Term Loan, as applicable.  

Tranche B Term Loan Commitment” means a U.S. Tranche B Term Loan Commitment and/or a Foreign Tranche B Term Loan Commitment, as applicable.



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Tranche B Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the sum of such Lender’s Foreign Tranche B Term Loan Exposure and U.S. Tranche B Term Loan Exposure.

Tranche B Term Loan Maturity Date” means the earlier of (i) the sixth anniversary of the Closing Date and (ii) with respect to the Foreign Tranche B Term Loans or the U.S. Tranche B Term Loans, as applicable, the date on which all such Tranche B Term Loans shall become due and payable in full hereunder, whether by acceleration or otherwise.

Tranche B Term Loan Note” means a promissory note substantially in the form of Exhibit B-2, as it may be amended, restated, supplemented or otherwise modified from time to time.

Transactions” means the Acquisition, the refinancing of the Existing Credit Facilities Indebtedness, the tender for and satisfaction and discharge of the Existing Notes, the issuance of the 2020 Notes, the entry into this Agreement and the initial borrowing of the Loans hereunder on the Closing Date, the Equity Contribution and the issuance of common equity of the U.S. Borrower to the Seller as required by the terms of the Acquisition Agreement.

Transaction Costs” means the fees, costs and expenses payable by any Group Member on or before the Closing Date in connection with the Transactions.

Treasury Transaction” means any derivative transaction entered into in connection with protection against or benefit from fluctuation in any rate or price and not for speculative purposes.

Type of Loan” means (i) with respect to either Term Loans or Revolving Loans, a Base Rate Loan, a Eurocurrency Rate Loan or a Canadian Prime Rate Loan and (ii) with respect to Swing Line Loans, a Base Rate Loan or a Canadian Prime Rate Loan.

UCC” means the Uniform Commercial Code (or any similar or equivalent legislation, including Personal Property Security legislation in Canada) as in effect in any applicable jurisdiction.

UK” means the United Kingdom.

Unrestricted Subsidiary” means any Subsidiary of the U.S. Borrower designated by the Board of Directors of the U.S. Borrower (or a duly authorized committee thereof) as an Unrestricted Subsidiary pursuant to Section 6.03 hereof subsequent to the date hereof, and any Subsidiary formed or acquired by an Unrestricted Subsidiary following such Unrestricted Subsidiary’s designation.

Up-Stream or Cross-Stream Security” has the meaning set forth in Section 7.13(a).

U.S. Borrower” has the meaning specified in the preamble hereto.

U.S. Contributing Guarantors” has the meaning set forth in section 7.02(b).



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U.S. Corresponding Debt” has the meaning set forth in Section 9.14(a)(ii).

U.S. Guaranteed Obligations” has the meaning set forth in Section 7.01(a).

U.S. Grantor” has the meaning specified in the U.S. Pledge and Security Agreement or the CKI Related Assets Pledge and Security Agreement, as applicable.

U.S. Guarantor” means each Guarantor that is a U.S. Subsidiary.

U.S. Issuing Bank” means an Issuing Bank that has agreed to issue U.S. Letters of Credit.

U.S. Lender” has the meaning set forth in Section 2.20(c).

U.S. Letter of Credit” means any commercial or standby letter of credit issued or to be issued by an Issuing Bank for the account of the U.S. Borrower or any of its Subsidiaries pursuant to Section 2.04(a)(i) of this Agreement, and any letter of credit listed on Schedule 1.01(k) issued and outstanding as of the Closing Date.  Each such letter of credit listed on Schedule 1.01(k) shall be deemed to constitute a U.S. Letter of Credit and a Letter of Credit issued hereunder on the Closing Date for all purposes under this Agreement and the other Loan Documents.

U.S. Letter of Credit Sublimit” means the lesser of (a) $220,000,000 and (b) the aggregate unused amount of the U.S. Revolving Commitments then in effect.  

U.S. Letter of Credit Usage” means, as at any date of determination, the sum of (i) the maximum aggregate amount which is, or at any time thereafter may become, available for drawing under all U.S. Letters of Credit then outstanding, and (ii) the aggregate amount of all drawings under U.S. Letters of Credit honored by an Issuing Bank and not theretofore reimbursed by or on behalf of the U.S. Borrower.

 “U.S. Loan” means a U.S. Tranche A Term Loan, a U.S. Tranche B Term Loan and/or a U.S. Revolving Loan.

U.S. Loan Party” means the U.S. Borrower and each U.S. Guarantor.

U.S. Offer” has the meaning set forth in Section 2.13(c).

U.S. Offer Loans” has the meaning set forth in Section 2.13(c).

U.S.-Owned DRE” means any entity that (A) is disregarded as an entity separate from its owner for U.S. federal tax purposes and is directly owned by the U.S. Borrower or a U.S. Subsidiary or (B) is treated as a partnership for U.S. federal tax purposes and all of the partners of which are domestic corporations for U.S. federal tax purposes, and, in the case of clause (A) or (B), that directly owns Equity Interests in a Foreign Subsidiary and does not own any significant asset other than Equity Interests and Securities of Foreign Subsidiaries.



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U.S. Parallel Debt” means in respect of a Loan Party (other than a Foreign Loan Party), any amount which that Loan Party owes to the Collateral Agent under Section 9.14.

U.S. Pledge Agreement” means the U.S. Pledge Agreement to be executed by the U.S. Borrower and certain U.S. Guarantors (other than CKI and the CKI Affiliates), as it may be amended, restated, supplemented or otherwise modified from time to time, pursuant to which  certain U.S. Loan Parties pledge shares in the stock of Foreign Subsidiaries in support of the Foreign Obligations.

U.S. Pledge and Security Agreement” means the U.S. Pledge and Security Agreement to be executed by the U.S. Borrower and each U.S. Guarantor (other than CKI and the CKI Affiliates) substantially in the form of Exhibit G, as it may be amended, restated, supplemented or otherwise modified from time to time.

U.S. Refunded Swing Line Loans” has the meaning set forth in Section 2.03(b)(iv).

U.S. Revolving Commitment” means the commitment of a Lender to make or otherwise fund any U.S. Revolving Loan and to acquire participations in U.S. Letters of Credit and Swing Line Loans hereunder and U.S. Revolving Commitmentsmeans such commitments of all Lenders in the aggregate. The amount of each Lender’s U.S. Revolving Commitment, if any, is set forth on Schedule 1.01(c) or in the applicable Assignment Agreement or Joinder Agreement, as applicable, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the U.S. Revolving Commitments as of the Closing Date is $265,000,000.

U.S. Revolving Commitment Period” means the period from the Closing Date to but excluding the U.S. Revolving Commitment Termination Date

U.S. Revolving Commitment Termination Date” means the earliest to occur of (i) the fifth anniversary of the Closing Date, (ii) the date the U.S. Revolving Commitments are permanently reduced to zero pursuant to Section 2.13(b) or 2.14 and (iii) the date of the termination of the U.S. Revolving Commitments pursuant to Section 8.01.  

U.S. Revolving Exposure” means, with respect to any Lender as of any date of determination, (i) prior to the termination of the U.S. Revolving Commitments, that Lender’s U.S. Revolving Commitment; and (ii) after the termination of the U.S. Revolving Commitments, the sum of (a) the aggregate outstanding principal amount of the U.S. Revolving Loans of that Lender, (b) in the case of an Issuing Bank, the aggregate U.S. Letter of Credit Usage in respect of all U.S. Letters of Credit issued by such Issuing Bank (net of any participations by Lenders in such U.S. Letters of Credit), (c) the aggregate amount of all participations by that Lender in any outstanding U.S. Letters of Credit or any unreimbursed drawing under any U.S. Letter of Credit, (d) in the case of the U.S. Swing Line Lender, the aggregate outstanding principal amount of all U.S. Swing Line Loans (net of any participations therein by other Lenders), and (e) the aggregate amount of all participations therein by that Lender in any outstanding U.S. Swing Line Loans.

U.S. Revolving Loan” means Loans made by a Lender in respect of its U.S. Revolving Commitment to the U.S. Borrower pursuant to Section 2.02(a) and/or Section 2.24.



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U.S. Security Agreements” means the U.S. Pledge and Security Agreement, the U.S. Pledge Agreement and the CKI Related Assets Pledge and Security Agreement.

U.S. Subsidiary” means any Restricted Subsidiary other than a Foreign Subsidiary.

U.S. Swing Line Lender” means Barclays Bank in its capacity as the U.S. Swing Line Lender hereunder, together with its permitted successors and assigns in such capacity.

U.S. Swing Line Loan” means a Loan made by the U.S. Swing Line Lender to the U.S. Borrower pursuant to Section 2.03(a)(i).

U.S. Swing Line Sublimit” means the lesser of (i) $25,000,000 and (ii) the aggregate unused amount of U.S. Revolving Commitments then in effect.

U.S. Tranche A Term Loan” means a Tranche A Term Loan denominated in Dollars and made by a Lender to the U.S. Borrower pursuant to Section 2.01(a)(i).

U.S. Tranche A Term Loan Commitment” means the commitment of a Lender to make or otherwise fund a U.S. Tranche A Term Loan and “U.S. Tranche A Term Loan Commitments” means such commitments of all Lenders in the aggregate.  The amount of each Lender’s U.S. Tranche A Term Loan Commitment, if any, is set forth on Schedule 1.01(a) or in the applicable Assignment Agreement, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the U.S. Tranche A Term Loan Commitments as of the Closing Date is $367,700,000.

U.S. Tranche A Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding principal amount of the U.S. Tranche A Term Loans of such Lender; provided, that at any time prior to the making of the U.S. Tranche A Term Loans, the U.S. Tranche A Term Loan Exposure of any Lender shall be equal to such Lender’s U.S. Tranche A Term Loan Commitment.

U.S. Tranche B Term Loan” means a Tranche B Term Loan denominated in Dollars and made by a Lender to the U.S. Borrower pursuant to Section 2.01(a)(ii).

U.S. Tranche B Term Loan Commitment” means the commitment of a Lender to make or otherwise fund a U.S. Tranche B Term Loan and “U.S. Tranche B Term Loan Commitments” means such commitments of all Lenders in the aggregate.  The amount of each Lender’s U.S. Tranche B Term Loan Commitment, if any, is set forth on Schedule 1.01(b) or in the applicable Assignment Agreement, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of the U.S. Tranche B Term Loan Commitments as of the Closing Date is $1,003,100,000.

U.S. Tranche B Term Loan Exposure” means, with respect to any Lender, as of any date of determination, the outstanding principal amount of the U.S. Tranche B Term Loans of such Lender; provided, that at any time prior to the making of the U.S. Tranche B Term Loans, the U.S. Tranche B Term Loan Exposure of any Lender shall be equal to such Lender’s U.S. Tranche B Term Loan Commitment.



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Valuation Date” means (i) the date two (2) Business Days prior to the making, continuing or converting of any Revolving Loan or the date of issuance or continuation of any Letter of Credit and (ii) any other date designated by the Administrative Agent or Issuing Bank.

Waivable Mandatory Prepayment” has the meaning set forth in Section 2.15(c).

Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing:  (i) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment by (ii) the then outstanding principal amount of such Indebtedness.

Wholly-Owned Restricted Subsidiary” means, with respect to any Person, any other Person all of the Equity Interests of which (other than (x) directors’ qualifying shares and (y) shares issued to foreign nationals to the extent required by applicable law) are owned by such Person directly and/or through other wholly-owned Restricted Subsidiaries of such Person.

Section 1.02

Accounting Terms

.  Except as otherwise expressly provided herein, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with GAAP.  Financial statements and other information required to be delivered by the Borrower Representative to Lenders pursuant to Section 5.01(a) and 5.01(b) shall be prepared in accordance with GAAP as in effect at the time of such preparation (and delivered together with the reconciliation statements provided for in Section 5.01(d), if applicable).  Subject to the foregoing, calculations in connection with the definitions, covenants and other provisions hereof shall utilize accounting principles and policies in conformity with those used to prepare the Historical Financial Statements of the U.S. Borrower; provided that if a change in GAAP would materially change the calculation of the financial covenants, standards or terms of this Agreement, (i) the Borrower Representative shall provide prompt notice of such change to the Administrative Agent and (ii) the Borrower Representative or the Administrative Agent may request that such calculations continue to be made in accordance with GAAP without giving effect to such change (in which case the Borrower Representative, the Administrative Agent and the Lenders agree to negotiate in good faith to amend the provisions hereof to eliminate the effect of such change in GAAP, but until such amendment is entered into, the calculations shall be made in accordance with those used to prepare the Historical Financial Statements of the U.S. Borrower without giving effect to such change).  

Section 1.03

Interpretation, Etc.

  Any of the terms defined herein may, unless the context otherwise requires, be used in the singular or the plural, depending on the reference.  References herein to any Article, Section, Schedule or Exhibit shall be to an Article, a Section, a Schedule or an Exhibit, as the case may be, hereof unless otherwise specifically provided.  The use herein of the word “include” or “including”, when following any general statement, term or matter, shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation” or “but not limited to” or words of similar import) is used with reference thereto, but rather shall be deemed to refer



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to all other items or matters that fall within the broadest possible scope of such general statement, term or matter. 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.  The terms lease and license shall include sub-lease and sub-license, as applicable.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  Except as otherwise expressly provided herein or therein, any reference in this Agreement or any other Loan Document to any agreement, document or instrument shall mean such agreement, document or instrument as amended, restated, supplemented or otherwise modified from time to time, in each case, in accordance with the express terms of this Agreement or such Loan Document.

Section 1.04

Exchange Rates; Currency Equivalents.  

(a)

The Administrative Agent or the Issuing Bank, as applicable, shall determine the Exchange Rates as of each Valuation Date to be used for calculating Euro Equivalent and Dollar Equivalent amounts of Credit Extensions and amounts outstanding hereunder denominated in other Approved Currencies.  Such Exchange Rates shall become effective as of such Valuation Date and shall be the Exchange Rates employed in converting any amounts between the applicable currencies until the next Valuation Date to occur.  Except for purposes of financial statements delivered by the Borrower Representative hereunder or except as otherwise provided herein, the applicable amount of any currency (other than Dollars) for purposes of the Loan Documents shall be the Dollar Equivalent of such currency as so determined by the Administrative Agent or the Issuing Bank, as applicable.

(b)

Whenever in this Agreement in connection with a borrowing, conversion, continuation or prepayment of a Eurocurrency Rate Loan or the issuance, amendment or extension of a Letter of Credit, an amount, such as a required minimum or multiple amount, is expressed in Dollars or Euros, but such borrowing, Eurocurrency Rate Loan or Letter of Credit is denominated in another Approved Currency, such amount shall be the relevant Foreign Currency Equivalent of such Dollar or Euro amount (rounded to the nearest unit of such other Approved Currency, with 0.5 or a unit being rounded upward), as determined by the Administrative Agent or the Issuing Bank, as the case may be.  

(c)

Notwithstanding the foregoing, for purposes of determining compliance with Sections 5.17, 6.01, 6.02, 6.04, 6.06, 6.07(c), 6.08 and 6.10, (i) with respect to any amount of cash on deposit, Indebtedness, Investment, Restricted Payment, Lien, Asset Sale or Attributable Indebtedness (each, a “Covenant Transaction”) in a currency other than Dollars, no Default or Event of Default shall be deemed to have occurred solely as a result of changes in rates of exchange occurring after the time such Covenant Transaction is incurred or made, and (ii) with respect to any Covenant Transaction incurred or made in reliance on a provision that makes reference to a percentage of Consolidated Total Assets, no Default or Event of Default shall be deemed to have occurred solely as a result of changes in the amount of Consolidated Total Assets occurring after the time such Covenant Transaction is incurred or made in reliance on such provision.



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(d)

For purposes of determining compliance with the Leverage Ratio, the amount of any Indebtedness denominated in any currency other than Dollars will be converted into Dollars based on the relevant currency exchange rate in effect on the date of the financial statements on which the applicable Consolidated Adjusted EBITDA is calculated.  For purposes of determining compliance with Sections 5.17, 6.01, 6.02, 6.04, 6.06, 6.07(c), 6.08 and 6.10, with respect to the amount of any Covenant Transaction in a currency other than Dollars, such amount (i) if incurred or made in reliance on a fixed Dollar basket, will be converted into Dollars based on the relevant currency exchange rate in effect on the Closing Date, and (ii) if incurred in reliance on a percentage basket, will be converted into Dollars based on the relevant currency exchange rate in effect on the date such Covenant Transaction is incurred or made and such percentage basket will be measured at the time such Covenant Transaction is incurred or made.

(e)

For the avoidance of doubt, in the case of a Loan denominated in an Approved Currency other than Dollars, except as expressly provided herein, all interest and fees shall accrue and be payable thereon based on the actual amount outstanding in such Approved Currency (without any translation into the Dollar Equivalent thereof).

Section 1.05

Dutch Terms

.  In this Agreement, where it relates to a Dutch Loan Party, a reference to:

(a)

a necessary action to authorize where applicable, includes without limitation: any action requires to comply with the Dutch Works Councils Act (Wet op de ondernemingsraden);

(b)

gross negligence means grove schuld;

(c)

a Lien includes any mortgage (hypotheek), pledge (pandrecht), retention of title arrangement (eigendomsvoorbehoud), right of retention (recht van retentie), right to reclaim goods (recht van reclame), and, in general, any right in rem, created for the purpose of granting security (goederenrechtelijk zekerheidsrecht);

(d)

willful misconduct means opzet;

(e)

a dissolution includes a Dutch entity being dissolved (ontbonden);

(f)

a moratorium includes surseance van betaling and granted a moratorium includes surseance verleend;

(g)

any step or procedure taken in connection with insolvency proceedings includes a Dutch entity having filed a notice under section 36 of the 1990 Dutch Tax Collection Act (Invorderingswet 1990);

(h)

a receiver includes a curator;

(i)

an administrator includes a bewindvoerder; and

(j)

an attachment includes a beslag.



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ARTICLE II.
LOANS AND LETTERS OF CREDIT

Section 2.01

Term Loans

.

(a)

Loan Commitments.  Subject to the terms and conditions hereof,

(i)

each Lender severally agrees to make, on the Closing Date, (x) a U.S. Tranche A Term Loan to the U.S. Borrower in an amount equal to such Lender’s U.S. Tranche A Term Loan Commitment and (y) a Foreign Tranche A Term Loan to the Foreign Borrower in an amount equal to such Lender’s Foreign Tranche A Term Loan Commitment; and

(ii)

each Lender severally agrees to make, on the Closing Date, (x) a U.S. Tranche B Term Loan to the U.S. Borrower in an amount equal to such Lender’s U.S. Tranche B Term Loan Commitment and (y) a Foreign Tranche B Term Loan to the Foreign Borrower in an amount equal to such Lender’s Foreign Tranche B Term Loan Commitment.

the Borrowers may make only one borrowing under each of the Tranche A Term Loan Commitments and Tranche B Term Loan Commitments which shall be on the Closing Date.  Any amount borrowed under this Section 2.01(a) and subsequently repaid or prepaid may not be reborrowed.  Subject to Sections 2.13(a) and 2.14, all amounts owed hereunder with respect to the Tranche A Term Loans and the Tranche B Term Loans shall be paid in full no later than the Tranche A Term Loan Maturity Date and the Tranche B Term Loan Maturity Date, respectively.  Each Lender’s Tranche A Term Loan Commitments and Tranche B Term Loan Commitments shall terminate immediately and without further action on the Closing Date after giving effect to the funding of such Lender’s Tranche A Term Loan Commitments and Tranche B Term Loan Commitments on such date.

(b)

Borrowing Mechanics for Term Loans.

(i)

The Borrower Representative shall deliver to the Administrative Agent a fully executed Borrowing Notice no later than one (1) Business Days prior to the Closing Date, which notice may be conditional upon the occurrence of the consummation of the Acquisition.  Promptly upon receipt by the Administrative Agent of such Borrowing Notice, the Administrative Agent shall notify each Lender of the proposed borrowing.

(ii)

Each Lender shall make its Tranche A Term Loans and/or Tranche B Term Loans, as the case may be, available to the Administrative Agent not later than 12:00 p.m. (New York City time) and, with respect to Foreign Tranche B Term Loans and Foreign Tranche A Term Loans, 12:00 P.M. (London time) on the Closing Date, by wire transfer of same day funds in Dollars or Euros, as the case may be, at the Principal Office designated by the Administrative Agent.  Upon satisfaction or waiver of the conditions precedent specified herein, the Administrative Agent shall make the proceeds of the Term Loans available to the applicable Borrower on the Closing Date by causing an amount of same day funds in Dollars equal to the proceeds of all such Loans



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received by the Administrative Agent from Lenders to be credited to the account of the applicable Borrower at the Principal Office designated by the Administrative Agent or to such other account as may be designated in writing to the Administrative Agent by the applicable Borrower.

Section 2.02

Revolving Loans

.  

(a)

U.S. Revolving Commitments.  During the U.S. Revolving Commitment Period, subject to the terms and conditions hereof, each Lender severally agrees to make U.S. Revolving Loans to the U.S. Borrower in an aggregate amount up to but not exceeding such Lender’s U.S. Revolving Commitment; provided, that after giving effect to the making of any U.S. Revolving Loans in no event shall the Total Utilization of U.S. Revolving Commitments exceed the U.S. Revolving Commitments then in effect.  Loans in respect of the U.S. Revolving Commitments may be drawn in Dollars.  Amounts borrowed pursuant to this Section 2.02(a) may be repaid and reborrowed during the applicable Revolving Commitment Period.  Each Lender’s U.S. Revolving Commitments shall expire on the U.S. Revolving Commitment Termination Date and all U.S. Revolving Loans and all other amounts owed hereunder with respect to the U.S. Revolving Loans and the U.S. Revolving Commitments shall be paid in full no later than such date.

(b)

Foreign Revolving Commitments.  During the Foreign Revolving Commitment Period, subject to the terms and conditions hereof, each Lender severally agrees to make Foreign Revolving Loans to the Foreign Borrower in an aggregate amount up to but not exceeding such Lender’s Foreign Revolving Commitment; provided, that after giving effect to the making of any Foreign Revolving Loans in no event shall the Total Utilization of Foreign Revolving Commitments exceed the Foreign Revolving Commitments then in effect.  Loans in respect of the Foreign Revolving Commitments may be drawn in Euros, Japanese Yen or Pounds Sterling, as specified in the Borrowing Notice.  Amounts borrowed pursuant to this Section 2.02(b) may be repaid and reborrowed during the applicable Revolving Commitment Period.  Each Lender’s Foreign Revolving Commitments shall expire on the Foreign Revolving Commitment Termination Date and all Foreign Revolving Loans and all other amounts owed hereunder with respect to the Foreign Revolving Loans and the Foreign Revolving Commitments shall be paid in full no later than such date.  Subject to the terms of this Agreement and the Ancillary Documents, an Ancillary Lender may make available an Ancillary Facility to the Foreign Borrower or an Ancillary Borrower in place of all or part of its Foreign Revolving Commitments.

(c)

Canadian Revolving Commitments. During the Canadian Revolving Commitment Period, subject to the terms and conditions hereof, each Lender severally agrees to make Canadian Revolving Loans to the U.S. Borrower in an aggregate amount up to but not exceeding such Lender’s Canadian Revolving Commitment; provided, that after giving effect to the making of any Canadian Revolving Loans in no event shall the Total Utilization of Canadian Revolving Commitments exceed the Canadian Revolving Commitments then in effect.  Loans in respect of the Canadian Revolving Commitments may be drawn in Dollars or Canadian Dollars.  Amounts borrowed pursuant to this Section 2.02(c) may be repaid and reborrowed during the applicable Revolving Commitment Period.  Each Lender’s Canadian Revolving Commitments shall expire on the Canadian Revolving Commitment Termination Date and all Canadian



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Revolving Loans and all other amounts owed hereunder with respect to the Canadian Revolving Loans and the Canadian Revolving Commitments shall be paid in full no later than such date.

(d)

Borrowing Mechanics for Revolving Loans.  

(i)

Except pursuant to 2.04(d), (x) U.S. Revolving Loans that are Base Rate Loans and Canadian Revolving Loans that are Base Rate Loans or Canadian Prime Rate Loans shall be made in a minimum amount of $5,000,000 and integral multiples of $1,000,000 in excess of that amount, (y) U.S. Revolving Loans and Canadian Revolving Loans that are Eurocurrency Rate Loans shall be in a minimum amount of $1,000,000 (or, with regard to Loans denominated in Canadian Dollars, the applicable Foreign Currency Equivalent) and integral multiples of $1,000,000 (or, with regard to Loans denominated in Canadian Dollars, the applicable Foreign Currency Equivalent) in excess of that amount and (z) Foreign Revolving Loans shall be in a minimum amount of 1,000,000 (or, with regard to Loans denominated in Other Foreign Currencies, the applicable Foreign Currency Equivalent) and integral multiples of 1,000,000 (or, with regard to Loans denominated in Other Foreign Currencies, the applicable Foreign Currency Equivalent) in excess of that amount.

(ii)

Whenever the U.S. Borrower desires that Lenders make Revolving Loans to it, it shall deliver to the Administrative Agent a fully executed and delivered Borrowing Notice no later than 10:00 a.m. (New York City time) (x) at least three (3) Business Days in advance of the proposed Credit Date in the case of a Eurocurrency Rate Loan denominated in Dollars or Canadian Dollars and (y) at least one Business Day in advance of the proposed Credit Date in the case of a Revolving Loan that is a Base Rate Loan denominated in Dollars or a Revolving Loan that is a Canadian Prime Rate Loan denominated in Canadian Dollars.  Whenever the Foreign Borrower desires that Lenders make Foreign Revolving Loans, it shall deliver to the Administrative Agent a fully executed and delivered Borrowing Notice no later than 10:00 a.m. (London, England time) at least three (3) Business Days in advance of the proposed Credit Date.  Except as otherwise provided herein, a Borrowing Notice for a Revolving Loan that is a Eurocurrency Rate Loan shall be irrevocable on and after the related Interest Rate Determination Date, and the applicable Borrower shall be bound to make a borrowing in accordance therewith.

(iii)

Notice of receipt of each Borrowing Notice in respect of U.S. Revolving Loans or Canadian Revolving Loans, together with the amount of each Lender’s Pro Rata Share thereof, if any, together with the applicable interest rate, shall be provided by the Administrative Agent to each applicable Lender by telefacsimile with reasonable promptness, but (provided the Administrative Agent shall have received such notice by 10:00 a.m. (New York City time)) not later than 2:00 p.m. (New York City time) on the same day as the Administrative Agent’s receipt of such Notice from the U.S. Borrower.  Each Lender shall make the amount of its U.S. Revolving Loan or Canadian Revolving Loan, as applicable, available to the Administrative Agent not later than 12:00 p.m. (New York City time) on the applicable Credit Date by wire transfer of same day funds in the requested Approved Currency, at the Principal Office designated by the Administrative Agent.  



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(iv)

Notice of receipt of each Borrowing Notice in respect of Foreign Revolving Loans, together with the amount of each Lender’s Pro Rata Share thereof, if any, together with the applicable interest rate, shall be provided by the Administrative Agent to each applicable Lender by telefacsimile with reasonable promptness, but (provided the Administrative Agent shall have received such notice by 10:00 a.m. (London, England time)) not later than 2:00 p.m. (London, England time) on the same day as the Administrative Agent’s receipt of such Notice from the applicable Foreign Borrower.  Each Lender shall make the amount of its Foreign Revolving Loan available to the Administrative Agent not later than 12:00 p.m. (London, England time) on the applicable Credit Date by wire transfer of same day funds in the requested Approved Currency, at the Principal Office designated by the Administrative Agent.

(v)

Except as provided herein, upon satisfaction or waiver of the conditions precedent specified herein, the Administrative Agent shall make the proceeds of Revolving Loans available to the applicable Borrower on the applicable Credit Date by causing an amount of same day funds in the requested Approved Currency equal to the proceeds of all such Revolving Loans received by the Administrative Agent from Lenders to be credited to the account of the applicable Borrower at the Principal Office designated by the Administrative Agent or such other account as may be designated in writing to the Administrative Agent by the applicable Borrower or the Borrower Representative.

Section 2.03

Swing Line Loans

.  

(a)

Swing Line Loans Commitments.

(i)

From time to time during the U.S. Revolving Commitment Period, subject to the terms and conditions hereof, the U.S. Swing Line Lender hereby agrees to make U.S. Swing Line Loans to the U.S. Borrower in the aggregate amount up to but not exceeding the U.S. Swing Line Sublimit; provided, that after giving effect to the making of any U.S. Swing Line Loan, in no event shall the Total Utilization of U.S. Revolving Commitments exceed the U.S. Revolving Commitments then in effect.  Amounts borrowed pursuant to this Section 2.03(a)(i) may be repaid and reborrowed during the U.S. Revolving Commitment Period.  The U.S. Swing Line Lender’s Revolving Commitment shall expire on the U.S. Revolving Commitment Termination Date.  All U.S. Swing Line Loans and all other amounts owed hereunder with respect to the U.S. Swing Line Loans shall be paid in full on the earlier of (i) the date which is three days after the incurrence thereof and (ii) the U.S. Revolving Commitment Termination Date; and

(ii)

From time to time during the Canadian Revolving Commitment Period, subject to the terms and conditions hereof, the Canadian Swing Line Lender hereby agrees to make Canadian Swing Line Loans to the U.S. Borrower in the aggregate amount up to but not exceeding the Canadian Swing Line Sublimit; provided, that after giving effect to the making of any Canadian Swing Line Loan, in no event shall the Total Utilization of Canadian Revolving Commitments exceed the Canadian Revolving Commitments then in effect.  Amounts borrowed pursuant to this Section 2.03(a)(ii) may



68






be repaid and reborrowed during the Canadian Revolving Commitment Period.  The Canadian Swing Line Lender’s Canadian Revolving Commitment shall expire on the Canadian Revolving Commitment Termination Date.  All Canadian Swing Line Loans and all other amounts owed hereunder with respect to the Canadian Swing Line Loans shall be paid in full on the earlier of (i) the date which is three days after the incurrence thereof and (ii) the Canadian Revolving Commitment Termination Date.

(b)

Borrowing Mechanics for Swing Line Loans.  

(i)

Swing Line Loans shall be made in a minimum amount of $500,000 and integral multiples of $100,000 in excess of that amount.

(ii)

Whenever the U.S. Borrower desires that the U.S. Swing Line Lender make a U.S. Swing Line Loan, the U.S. Borrower shall deliver to the Administrative Agent a Borrowing Notice no later than 10:30 a.m. (New York City time) on the proposed Credit Date.  Whenever the U.S. Borrower desires that the Canadian Swing Line Lender make a Canadian Swing Line Loan, the U.S. Borrower shall deliver to the Administrative Agent a Borrowing Notice no later than 10:00 a.m. (New York City time) on the proposed Credit Date.  

(iii)

The applicable Swing Line Lender shall make the amount of its Swing Line Loan available to the Administrative Agent not later than 1:00 p.m.(New York City time) on the applicable Credit Date by wire transfer of same day funds in Dollars or Canadian Dollars, at the Administrative Agent’s Principal Office.  Except as provided herein, upon satisfaction or waiver of the conditions precedent specified herein, the Administrative Agent shall make the proceeds of such Swing Line Loans available to the U.S. Borrower promptly upon receipt from such Swing Line Lender on the applicable Credit Date by causing an amount of same day funds in Dollars or Canadian Dollars equal to the proceeds of all such Swing Line Loans received by the Administrative Agent from the applicable Swing Line Lender to be credited to the account of the U.S. Borrower at the Administrative Agent’s Principal Office, or to such other account as may be designated in writing to the Administrative Agent by the U.S. Borrower.

(iv)

With respect to any Swing Line Loans which have not been voluntarily prepaid by the U.S. Borrower pursuant to Section 2.13(a) or repaid pursuant to clause (a) above, the applicable Swing Line Lender may at any time in its sole and absolute discretion, deliver to the Administrative Agent (with a copy to the U.S. Borrower), no later than 11:00 a.m. (New York City time) at least one Business Day in advance of the proposed Credit Date, a notice (which shall be deemed to be a Borrowing Notice given by the U.S. Borrower) requesting that (x) with regard to any U.S. Swing Line Loan, each Lender holding a U.S. Revolving Commitment make U.S. Revolving Loans that are Base Rate Loans to the U.S. Borrower on such Credit Date in an amount equal to the amount of such U.S. Swing Line Loans (the “U.S. Refunded Swing Line Loans”) outstanding on the date such notice is given which the U.S. Swing Line Lender requests Lenders to prepay, and (y) with regard to any Canadian Swing Line Loan, each Lender holding a Canadian Revolving Commitment make Canadian Revolving Loans that are Base Rate Loans or Canadian Prime Rate Loans, as applicable, to the U.S.



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Borrower on such Credit Date in an amount equal to the amount of such Canadian Swing Line Loans (the “Canadian Refunded Swing Line Loans” and, together with the U.S. Refunded Swing Line Loans, the “Refunded Swing Line Loans”) outstanding on the date such notice is given which the Canadian Swing Line Lender requests Lenders to prepay. Anything contained in this Agreement to the contrary notwithstanding, (1) the proceeds of such Revolving Loans made by the Lenders other than the applicable Swing Line Lender shall be immediately delivered by the Administrative Agent to the applicable Swing Line Lender (and not to the U.S. Borrower) and applied to repay a corresponding portion of the applicable Refunded Swing Line Loans and (2) on the day such Revolving Loans are made, the applicable Swing Line Lender’s Pro Rata Share of the Refunded Swing Line Loans shall be deemed to be paid with the proceeds of a Revolving Loan made by the applicable Swing Line Lender to the U.S. Borrower, and such portion of the Swing Line Loans deemed to be so paid shall no longer be outstanding as Swing Line Loans and shall no longer be due under the applicable Swing Line Note of the applicable Swing Line Lender but shall instead constitute part of the applicable Swing Line Lender’s outstanding Revolving Loans to the U.S. Borrower and shall be due under the applicable Revolving Loan Note issued by the U.S. Borrower to the applicable Swing Line Lender. If any portion of any such amount paid (or deemed to be paid) to the applicable Swing Line Lender should be recovered by or on behalf of the U.S. Borrower from the applicable Swing Line Lender in bankruptcy, by assignment for the benefit of creditors or otherwise, the loss of the amount so recovered shall be ratably shared among all Lenders in the manner contemplated by Section 2.17.

(v)

If for any reason Revolving Loans are not made pursuant to Section 2.03(b)(iv) in an amount sufficient to repay any amounts owed to the applicable Swing Line Lender in respect of any outstanding Swing Line Loans on or before the third Business Day after demand for payment thereof by the applicable Swing Line Lender, (x) each Lender holding a U.S. Revolving Commitment shall be deemed to, and hereby agrees to, have purchased a participation in such outstanding U.S. Swing Line Loans in an amount equal to its Pro Rata Share of the applicable unpaid amount together with accrued interest thereon, and (y) each Lender holding a Canadian Revolving Commitment shall be deemed to, and hereby agrees to, have purchased a participation in such outstanding Canadian Swing Line Loans in an amount equal to its Pro Rata Share of the applicable unpaid amount together with accrued interest thereon. Upon one Business Day’s notice from the applicable Swing Line Lender, each Lender holding a U.S. Revolving Commitment or a Canadian Revolving Commitment, as applicable, shall deliver to the applicable Swing Line Lender an amount equal to its respective participation in the applicable unpaid amount in same day funds at the Principal Office of such Swing Line Lender. In order to evidence such participation each Lender holding such a Revolving Commitment agrees to enter into a participation agreement at the request of the applicable Swing Line Lender in form and substance reasonably satisfactory to the applicable Swing Line Lender.  In the event any Lender holding such a Revolving Commitment fails to make available to the applicable Swing Line Lender the amount of such Lender’s participation as provided in this paragraph, the applicable Swing Line Lender shall be entitled to recover such amount on demand from such Lender together with interest thereon for three (3) Business Days at the rate customarily used by



70






the applicable Swing Line Lender for the correction of errors among banks and thereafter at the Base Rate or the Canadian Prime Rate, as applicable.

(vi)

Notwithstanding anything contained herein to the contrary, (1) each Lender’s obligation to make Revolving Loans for the purpose of repaying any Refunded Swing Line Loans pursuant to Section 2.03(b)(iv) and each Lender’s obligation to purchase a participation in any unpaid Swing Line Loans pursuant to the immediately preceding paragraph shall be absolute and unconditional and shall not be affected by any circumstance, including (A) any set-off, counterclaim, recoupment, defense or other right which such Lender may have against the applicable Swing Line Lender, any Loan Party or any other Person for any reason whatsoever; (B) the occurrence or continuation of a Default or Event of Default; (C) any adverse change in the business, operations, properties, assets, condition (financial or otherwise) or prospects of any Loan Party; (D) any breach of this Agreement or any other Loan Document by any party thereto; or (E) any other circumstance, happening or event whatsoever, whether or not similar to any of the foregoing; provided, that such obligations of each Lender are subject to the condition that the applicable Swing Line Lender had not received prior notice from the U.S. Borrower or the Required Lenders that any of the conditions under Section 3.02 to the making of the applicable Refunded Swing Line Loans or other unpaid Swing Line Loans were not satisfied at the time such Refunded Swing Line Loans or unpaid Swing Line Loans were made; and (2) no Swing Line Lender shall be obligated to make any Swing Line Loans (A) if it has elected not to do so after the occurrence and during the continuation of a Default or Event of Default, (B) it does not in good faith believe that all conditions under Section 3.02 to the making of such Swing Line Loan have been satisfied or waived by the Required Lenders or (C) at a time when any Lender is a Defaulting Revolving Lender with U.S. Revolving Commitments or Canadian Revolving Commitments, as applicable, unless the applicable Swing Line Lender has entered into arrangements satisfactory to it and the U.S. Borrower to eliminate the applicable Swing Line Lender’s risk with respect to the Defaulting Revolving Lender’s participation in such Swing Ling Loan, including by the U.S. Borrower cash collateralizing such Defaulting Revolving Lender’s Pro Rata Share of the outstanding Swing Line Loans.

Section 2.04

Issuance of Letters of Credit and Purchase of Participations Therein

.  

(a)

Letters of Credit.  

(i)

During the U.S. Revolving Commitment Period, subject to the terms and conditions hereof, each U.S. Issuing Bank agrees to issue U.S. Letters of Credit for the account of the U.S. Borrower or any Restricted Subsidiary thereof in the aggregate amount up to but not exceeding the U.S. Letter of Credit Sublimit; provided, that (i) each U.S. Letter of Credit shall be denominated in Dollars; (ii) the stated amount of each U.S. Letter of Credit shall not be less than $2,000 or such lesser amount as is acceptable to the applicable Issuing Bank; (iii) after giving effect to such issuance, in no event shall the Total Utilization of U.S. Revolving Commitments exceed the U.S. Revolving Commitments then in effect; (iv) after giving effect to such issuance, in no event shall the U.S. Letter of Credit Usage exceed the U.S. Letter of Credit Sublimit then in effect; (v) in



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no event shall any standby U.S. Letter of Credit have an expiration date later than the earlier of (1) the U.S. Revolving Commitment Termination Date and (2) the date which is one year from the date of issuance of such standby Letter of Credit; and (vi) in no event shall any commercial U.S. Letter of Credit have an expiration date later than the earlier of (1) the U.S. Revolving Commitment Termination Date and (2) the date which is 180 days from the date of issuance of such commercial Letter of Credit.  

(ii)

During the Foreign Revolving Commitment Period, subject to the terms and conditions hereof, each Foreign Issuing Bank agrees to issue Foreign Letters of Credit for the account of the Foreign Borrower or any Restricted Subsidiary thereof in the aggregate amount up to but not exceeding the Foreign Letter of Credit Sublimit; provided, that (i) each Foreign Letter of Credit shall be denominated in Euros, Japanese Yen or Pounds Sterling; (ii) the stated amount of each Foreign Letter of Credit shall not be less than 1500 (or the applicable Foreign Currency Equivalent) or such lesser amount as is acceptable to the applicable Issuing Bank; (iii) after giving effect to such issuance, in no event shall the Total Utilization of Foreign Revolving Commitments exceed the Foreign Revolving Commitments then in effect; (iv) after giving effect to such issuance, in no event shall the Foreign Letter of Credit Usage exceed the Foreign Letter of Credit Sublimit then in effect; (v) in no event shall any standby Foreign Letter of Credit have an expiration date later than the earlier of (1) the Foreign Revolving Commitment Termination Date and (2) the date which is one year from the date of issuance of such standby Letter of Credit; and (vi) in no event shall any commercial Foreign Letter of Credit have an expiration date later than the earlier of (1) the Foreign Revolving Commitment Termination Date and (2) the date which is 180 days from the date of issuance of such commercial Letter of Credit.

(iii)

During the Canadian Revolving Commitment Period, subject to the terms and conditions hereof, each Canadian Issuing Bank agrees to issue Canadian Letters of Credit for the account of the U.S. Borrower or any Restricted Subsidiary thereof in the aggregate amount up to but not exceeding the Canadian Letter of Credit Sublimit; provided, that (i) each Canadian Letter of Credit shall be denominated in Dollars or Canadian Dollars; (ii) the stated amount of each Canadian Letter of Credit shall not be less than $2,000 (or the applicable Foreign Currency Equivalent) or such lesser amount as is acceptable to the applicable Issuing Bank; (iii) after giving effect to such issuance, in no event shall the Total Utilization of Canadian Revolving Commitments exceed the Canadian Revolving Commitments then in effect; (iv) after giving effect to such issuance, in no event shall the Canadian Letter of Credit Usage exceed the Canadian Letter of Credit Sublimit then in effect; (v) in no event shall any standby Canadian Letter of Credit have an expiration date later than the earlier of (1) the Canadian Revolving Commitment Termination Date and (2) the date which is one year from the date of issuance of such standby Letter of Credit; and (vi) in no event shall any commercial Canadian Letter of Credit have an expiration date later than the earlier of (1) the Canadian Revolving Commitment Termination Date and (2) the date which is 180 days from the date of issuance of such commercial Letter of Credit.  

Subject to the foregoing, (i) an Issuing Bank may agree that a standby Letter of Credit shall automatically be extended for one or more successive periods not to exceed one year each;



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provided, that no Issuing Bank shall extend any such Letter of Credit if it has received written notice that an Event of Default has occurred and is continuing at the time such Issuing Bank must elect to allow such extension; (ii) if the applicable Issuing Bank and the Administrative Agent each consent in their sole discretion, the expiration date on any Letter of Credit may extend beyond the applicable Revolving Commitment Termination Date; provided, that if any such Letter of Credit is outstanding or the expiration date is extended to a date after the date that is five (5) Business Days prior to the applicable Revolving Commitment Termination Date, the applicable Borrower shall Cash Collateralize such Letter of Credit on or prior to the date that is five (5) Business Days prior to the applicable Revolving Commitment Termination Date; and (iii) in the event that any Lender is a Defaulting Revolving Lender, the applicable Issuing Bank shall not be required to issue any Letter of Credit under the applicable Revolving Commitment unless such Issuing Bank has entered into arrangements satisfactory to it and the applicable Borrower to eliminate such Issuing Bank’s risk with respect to the participation in Letters of Credit of the Defaulting Revolving Lender, including by cash collateralizing such Defaulting Revolving Lender’s Pro Rata Share of the applicable Letter of Credit Usage.  Notwithstanding the foregoing, Barclays Bank shall have no obligation to issue commercial Letters of Credit unless separately agreed to by Barclays Bank and the Borrower Representative.  

(b)

Notice of Issuance.  

(i)

Whenever the U.S. Borrower or any Restricted Subsidiary thereof desires the issuance of a Letter of Credit, the U.S. Borrower shall (x) in the case of standby Letters of Credit, deliver to the Administrative Agent and the applicable Issuing Bank an Issuance Notice (or such other notice as may be agreed by such Issuing Bank) no later than 12:00 p.m. (New York City time) at least three (3) Business Days in advance of the proposed date of issuance, or such shorter period as may be agreed to by the Issuing Bank in any particular instance and (y) in the case of commercial Letters of Credit, deliver to the applicable Issuing Bank an application therefor on the proposed date of issuance. Such Issuance Notice shall specify if such Letter of Credit is requested under the U.S. Revolving Commitments or the Canadian Revolving Commitments.  Upon satisfaction or waiver of the conditions set forth in Section 3.02, the Issuing Bank shall issue the requested Letter of Credit only in accordance with the Issuing Bank’s standard operating procedures.  Upon the issuance of any U.S. Letter of Credit or amendment or modification to a U.S. Letter of Credit, the Issuing Bank shall promptly notify the Administrative Agent, and the Administrative Agent shall promptly notify each Lender with a U.S. Revolving Commitment, of such issuance, or amendment or modification and the amount of such Lender’s respective participation in such U.S. Letter of Credit pursuant to Section 2.04(e). Upon the issuance of any Canadian Letter of Credit or amendment or modification to a Canadian Letter of Credit, the Issuing Bank shall promptly notify the Administrative Agent, and the Administrative Agent shall promptly notify each Lender with a Canadian Revolving Commitment, of such issuance, amendment or modification to such Canadian Letter of Credit and the amount of such Lender’s respective participation in such Canadian Letter of Credit pursuant to Section 2.04(e).

(ii)

Whenever the Foreign Borrower or any Restricted Subsidiary thereof desires the issuance of a Letter of Credit, the Foreign Borrower or the Borrower



73






Representative shall (x) in the case of standby Letters of Credit, deliver to the Administrative Agent and the applicable Issuing Bank an Issuance Notice (or such other notice as may be agreed by such Issuing Bank) no later than 12:00 p.m. (London, England time) at least three (3) Business Days in advance of the proposed date of issuance, or such shorter period as may be agreed to by the Issuing Bank in any particular instance and (y) in the case of commercial Letters of Credit, deliver to the applicable Issuing Bank an application therefor on the proposed date of issuance.  Upon satisfaction or waiver of the conditions set forth in Section 3.02, the Issuing Bank shall issue the requested Letter of Credit only in accordance with the Issuing Bank’s standard operating procedures.  Upon the issuance of any Foreign Letter of Credit or amendment or modification to a Foreign Letter of Credit, the Issuing Bank shall promptly notify the Administrative Agent and each Lender with a Foreign Revolving Commitment of such issuance, or amendment or modification and the amount of such Lender’s respective participation in such Letter of Credit pursuant to Section 2.04(e).

(c)

Responsibility of the Issuing Bank With Respect to Requests for Drawings and Payments.  In determining whether to honor any drawing under any Letter of Credit by the beneficiary thereof, the applicable Issuing Bank shall be responsible only to examine the documents delivered under such Letter of Credit with reasonable care so as to ascertain whether they appear on their face to be in accordance with the terms and conditions of such Letter of Credit.  As between the Borrowers and the applicable Issuing Bank, each Borrower assumes all risks of the acts and omissions of, or misuse of the Letters of Credit issued by the applicable Issuing Bank by, the respective beneficiaries of such Letters of Credit.  In furtherance and not in limitation of the foregoing, the Issuing Bank shall not be responsible for: (i) the form, validity, sufficiency, accuracy, genuineness or legal effect of any document submitted by any party in connection with the application for and issuance of any such Letter of Credit, even if it should in fact prove to be in any or all respects invalid, insufficient, inaccurate, fraudulent or forged; (ii) the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign any such Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason; (iii) failure of the beneficiary of any such Letter of Credit to comply fully with any conditions required in order to draw upon such Letter of Credit; (iv) errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex or otherwise, whether or not they be in cipher; (v) errors in interpretation of technical terms; (vi) any loss or delay in the transmission or otherwise of any document required in order to make a drawing under any such Letter of Credit or of the proceeds thereof; (vii) the misapplication by the beneficiary of any such Letter of Credit of the proceeds of any drawing under such Letter of Credit; or (viii) any consequences arising from causes beyond the control of the Issuing Bank, including any Governmental Acts; none of the above shall affect or impair, or prevent the vesting of, any of the Issuing Bank’s rights or powers hereunder.  Without limiting the foregoing and in furtherance thereof, no action taken or omitted by an Issuing Bank under or in connection with the Letters of Credit or any documents and certificates delivered thereunder, if taken or omitted in good faith and in the absence of gross negligence or willful misconduct (as determined by a final, non-appealable judgment of a court of competent jurisdiction), shall give rise to any liability on the part of such Issuing Bank to any Borrower; provided that the foregoing shall not be construed to excuse such Issuing Bank from liability to the Borrowers to the extent of any direct damages suffered by the Borrowers or any of their Subsidiaries that are determined by a final, non-appealable judgment of a court of



74






competent jurisdiction to have been caused by such Issuing Bank’s gross negligence or willful misconduct.

(d)

Reimbursement by the Borrowers of Amounts Drawn or Paid Under Letters of Credit.  

(i)

In the event an Issuing Bank has determined to honor a drawing under a U.S. Letter of Credit or Canadian Letter of Credit, it shall immediately notify the U.S. Borrower and the Administrative Agent, and the U.S. Borrower shall reimburse the applicable Issuing Bank on or before the Business Day immediately following the date on which such notice is received by the U.S. Borrower (the “Reimbursement Date”) in an amount in the Approved Currency in which such Letter of Credit was issued and in same day funds equal to the amount of such honored drawing; provided, that anything contained herein to the contrary notwithstanding, (x) unless the U.S. Borrower shall have notified the Administrative Agent and the applicable Issuing Bank prior to 10:00 a.m. (New York City time) on the Reimbursement Date that the U.S. Borrower intends to reimburse the applicable Issuing Bank for the amount of such honored drawing with funds other than the proceeds of Revolving Loans, the Borrower Representative shall be deemed to have given a timely Borrowing Notice to the Administrative Agent requesting (A) in the case of a U.S. Letter of Credit, Lenders with U.S. Revolving Commitments to make U.S. Revolving Loans that are Base Rate Loans on the Reimbursement Date in an amount in Dollars equal to the amount of such honored drawing and (B) in the case of a Canadian Letter of Credit, Lenders with Canadian Revolving Commitments to make Canadian Revolving Loans that are Canadian Prime Rate Loans on the Reimbursement Date in an amount in Canadian Dollars or Dollars, as applicable, equal to the amount of such honored drawing (provided that, in respect of any honored drawing in an amount less than $250,000 (or the Canadian Dollar equivalent), the U.S. Borrower shall reimburse the applicable Issuing Bank for such amount in cash and shall not be entitled to reimburse such drawing in accordance with this clause (x)) and (y) subject to satisfaction or waiver of the conditions specified in Section 3.02, (A) Lenders with U.S. Revolving Commitments shall, on the Reimbursement Date for any U.S. Letter of Credit, make U.S. Revolving Loans that are Base Rate Loans in the amount of such honored drawing and (B) Lenders with Canadian Revolving Commitments shall, on the Reimbursement Date for any Canadian Letter of Credit, make Canadian Revolving Loans that are Canadian Prime Rate Loans in an amount of such honored drawing, in each case, the proceeds of which shall be applied directly by the Administrative Agent to reimburse the applicable Issuing Bank for the amount of such honored drawing; provided, further, that if for any reason proceeds of Revolving Loans are not received by the applicable Issuing Bank on the Reimbursement Date in an amount equal to the amount of such honored drawing, the U.S. Borrower shall reimburse the Issuing Bank, on demand, in an amount in same day funds equal to the excess of the amount of such honored drawing over the aggregate amount of such Revolving Loans, if any, which are so received.  

(ii)

In the event the Issuing Bank has determined to honor a drawing under a Foreign Letter of Credit, it shall immediately notify the applicable Foreign Borrower and the Administrative Agent, and the applicable Foreign Borrower shall reimburse the Issuing Bank on or before the Reimbursement Date in an amount in the



75






Approved Currency in which such Letter of Credit was issued and in same day funds equal to the amount of such honored drawing; provided, that anything contained herein to the contrary notwithstanding, (i) unless the applicable Foreign Borrower shall have notified the Administrative Agent and the Issuing Bank prior to 10:00 a.m. (London, England time) on the Reimbursement Date that the Foreign Borrower intends to reimburse the Issuing Bank for the amount of such honored drawing with funds other than the proceeds of Revolving Loans, the Borrower Representative shall be deemed to have given a timely Borrowing Notice to the Administrative Agent requesting Lenders with Foreign Revolving Commitments to make Foreign Revolving Loans that are Eurocurrency Rate Loans with an Interest Period of one month on the Reimbursement Date in an amount in the applicable Approved Currency equal to the amount of such honored drawing (provided that, in respect of any honored drawing in an amount less than 250,000, the Foreign Borrower shall reimburse the applicable Issuing Bank for such amount in cash and shall not be entitled to reimburse such drawing in accordance with this clause (i)), and (ii) subject to satisfaction or waiver of the conditions specified in Section 3.02, Lenders with Foreign Revolving Commitments shall, on the Reimbursement Date for any Foreign Letter of Credit, make Foreign Revolving Loans that are Eurocurrency Rate Loans with an Interest Period of one month in the amount of such honored drawing, the proceeds of which shall be applied directly by the Administrative Agent to reimburse the Issuing Bank for the amount of such honored drawing; provided, further, that if for any reason proceeds of Foreign Revolving Loans are not received by the Issuing Bank on the Reimbursement Date in an amount equal to the amount of such honored drawing, the applicable Foreign Borrower shall reimburse the Issuing Bank, on demand, in an amount in same day funds equal to the excess of the amount of such honored drawing over the aggregate amount of such Foreign Revolving Loans, if any, which are so received

Nothing in this Section 2.04(d) shall be deemed to relieve any Lender with a Revolving Commitment from its obligation to make Revolving Loans on the terms and conditions set forth herein, and each Borrower shall retain any and all rights it may have against any such Lender resulting from the failure of such Lender to make such Revolving Loans under this Section 2.04(d).  

(e)

Lenders’ Purchase of Participations in Letters of Credit.  Immediately upon the issuance of each U.S. Letter of Credit, each Lender having a U.S. Revolving Commitment shall be deemed to have purchased, and hereby agrees to irrevocably purchase, from the applicable Issuing Bank a participation in such U.S. Letter of Credit and any drawings honored thereunder in an amount equal to such Lender’s Pro Rata Share (with respect to the U.S. Revolving Commitments) of the maximum amount which is or at any time may become available to be drawn thereunder.  Immediately upon the issuance of each Canadian Letter of Credit, each Lender having a Canadian Revolving Commitment shall be deemed to have purchased, and hereby agrees to irrevocably purchase, from the applicable Issuing Bank a participation in such Canadian Letter of Credit and any drawings honored thereunder in an amount equal to such Lender’s Pro Rata Share (with respect to the Canadian Revolving Commitments) of the maximum amount which is or at any time may become available to be drawn thereunder.  Immediately upon the issuance of each Foreign Letter of Credit, each Lender having a Foreign Revolving Commitment shall be deemed to have purchased, and hereby agrees



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to irrevocably purchase, from the applicable Issuing Bank a participation in such Foreign Letter of Credit and any drawings honored thereunder in an amount equal to such Lender’s Pro Rata Share (with respect to the Foreign Revolving Commitments) of the maximum amount which is or at any time may become available to be drawn thereunder.  In the event that the applicable Borrower shall fail for any reason to reimburse the applicable Issuing Bank as provided in Section 2.04(d), such Issuing Bank shall promptly notify each Lender with an applicable Revolving Commitment of the unreimbursed amount of such honored drawing and of such Lender’s respective participation therein based on such Lender’s Pro Rata Share of the applicable Revolving Commitments.  Each Lender with a U.S. Revolving Commitment shall make available to the applicable Issuing Bank an amount equal to its respective participation, in Dollars and in same day funds, at the office of the Issuing Bank specified in such notice, not later than 12:00 p.m. (New York City time) on the first Business Day (under the laws of the jurisdiction in which such office of the Issuing Bank is located) after the date notified by the Issuing Bank.  Each Lender with a Canadian Revolving Commitment shall make available to the applicable Issuing Bank an amount equal to its respective participation, in Dollars or Canadian Dollars, as applicable, and in same day funds, at the office of the Issuing Bank specified in such notice, not later than 12:00 p.m. (New York City time) on the first Business Day (under the laws of the jurisdiction in which such office of the Issuing Bank is located) after the date notified by the Issuing Bank.  Each Lender with a Foreign Revolving Commitment shall make available to the applicable Issuing Bank an amount equal to its respective participation, in Euros or such Other Foreign Currency, as applicable, and in same day funds, at the office of the Issuing Bank specified in such notice, not later than 12:00 p.m. (London, England time) on the first Business Day (under the laws of the jurisdiction in which such office of the Issuing Bank is located) after the date notified by the Issuing Bank.  In the event that any Lender with a U.S. Revolving Commitment, Canadian Revolving Commitment or Foreign Revolving Commitment, as applicable, fails to make available to the applicable Issuing Bank on such Business Day the amount of such Lender’s participation in such Letter of Credit as provided in this Section 2.04(e), the applicable Issuing Bank shall be entitled to recover such amount on demand from such Lender together with interest thereon for three (3) Business Days at the rate customarily used by the Issuing Bank for the correction of errors among banks and thereafter, in respect of U.S. Letters of Credit, at the Base Rate, in respect of Canadian Letters of Credit denominated in Canadian Dollars, at the Canadian Prime Rate, in respect of Canadian Letters of Credit denominated in Dollars, at the Base Rate, and in respect of Foreign Letters of Credit, at the Eurocurrency Rate for an Interest Period of one month.  In the event the applicable Issuing Bank shall have been reimbursed by other Lenders pursuant to this Section 2.04(e) for all or any portion of any drawing honored by the Issuing Bank under a Letter of Credit, the Issuing Bank shall distribute to each Lender which has paid all amounts payable by it under this Section 2.04(e) with respect to such honored drawing such Lender’s Pro Rata Share (with respect to the applicable Revolving Commitments) of all payments subsequently received by the applicable Issuing Bank from the applicable Borrower in reimbursement of such honored drawing when such payments are received.  Any such distribution shall be made to a Lender at its primary address set forth below its name on Schedule 1.01(d) or at such other address as such Lender may request.

(f)

Obligations Absolute.  The obligation of (i) the U.S. Borrower to reimburse each applicable Issuing Bank for drawings honored under the U.S. Letters of Credit or Canadian Letters of Credit issued by it and to repay any U.S. Revolving Loans or Canadian



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Revolving Loans made by Lenders pursuant to Section 2.04(d), (ii) the Foreign Borrower to reimburse the Issuing Bank for drawings honored under the Foreign Letters of Credit issued by it to the Foreign Borrower and to repay any Foreign Revolving Loans made by Lenders pursuant to Section 2.04(d) and (iii) the Lenders under Section 2.04(e), in each case shall be unconditional and irrevocable and shall be paid strictly in accordance with the terms hereof under all circumstances including any of the following circumstances: (i) any lack of validity or enforceability of any Letter of Credit; (ii) the existence of any claim, set-off, defense or other right which any Borrower or any Lender may have at any time against a beneficiary or any transferee of any Letter of Credit (or any Persons for whom any such transferee may be acting), Issuing Bank, Lender or any other Person or, in the case of a Lender, against any Borrower, whether in connection herewith, the transactions contemplated herein or any unrelated transaction (including any underlying transaction between any Borrower or one of its Subsidiaries and the beneficiary for which any Letter of Credit was procured); (iii) any draft or other document presented under any Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (iv) payment by the applicable Issuing Bank under any Letter of Credit against presentation of a draft or other document which does not substantially comply with the terms of such Letter of Credit; (v) any adverse change in the business, general affairs, assets, liabilities, operations, management, condition (financial or otherwise), stockholders’ equity, results of operations or value of any Loan Party; (vi) any breach hereof or any other Loan Document by any party thereto; (vii) the fact that an Event of Default or a Default shall have occurred and be continuing; or (viii) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing; provided that in each case payment by the Issuing Bank under the applicable Letter of Credit shall not have been determined by a final, non-appealable judgment of a court of competent jurisdiction to have constituted gross negligence, bad faith or willful misconduct of the Issuing Bank under the circumstances in question.

(g)

Indemnification.  Without duplication of any obligation of the Borrowers under Section 10.02 or 10.03, in addition to amounts payable as provided herein, each Borrower hereby agrees to protect, indemnify, pay and save harmless the Issuing Bank from and against any and all claims, demands, liabilities, damages, losses, costs, charges and expenses (including reasonable fees, expenses and disbursements of counsel) which any Issuing Bank may incur or be subject to as a consequence, direct or indirect, of (i) the issuance of any Letter of Credit by such Issuing Bank for the account of such Borrower, other than as a result of (1) the gross negligence, bad faith or willful misconduct of the Issuing Bank or (2) the dishonor by the Issuing Bank of a demand for payment made in compliance with the provisions hereunder or under the Letter of Credit, in each case, as determined by a final, non-appealable judgment of court of competent jurisdiction, or (ii) the failure of such Issuing Bank to honor a drawing under any such Letter of Credit as a result of any Governmental Act.

(h)

Resignation and Removal of Issuing Bank.  An Issuing Bank may resign as Issuing Bank upon 60 days prior written notice to the Administrative Agent, the Lenders and the Borrower Representative.  An Issuing Bank may be replaced at any time by written agreement among the Borrower Representative, the Administrative Agent, the replaced Issuing Bank (provided that no consent of the replaced Issuing Bank will be required if the replaced Issuing Bank has no Letters of Credit or reimbursement Obligations with respect thereto outstanding) and the successor Issuing Bank.  The Administrative Agent shall notify the Lenders



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of any such replacement of such Issuing Bank.  At the time any such replacement or resignation shall become effective, the applicable Borrower shall pay all unpaid fees accrued for the account of the replaced Issuing Bank.  From and after the effective date of any such replacement or resignation, (i) any successor Issuing Bank shall have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit to be issued thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require.  After the replacement or resignation of an Issuing Bank hereunder, the replaced Issuing Bank shall remain a party hereto to the extent that Letters of Credit issued by it remain outstanding and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such replacement or resignation, but shall not be required to issue additional Letters of Credit or to renew existing Letters of Credit.

Section 2.05

Pro Rata Shares; Availability of Funds

.  

(a)

Pro Rata Shares.  All Loans shall be made, and all participations purchased, by Lenders simultaneously and proportionately to their respective Pro Rata Shares of the applicable Class of Loans, it being understood that no Lender shall be responsible for any default by any other Lender in such other Lender’s obligation to make a Loan requested hereunder or purchase a participation required hereby nor shall any Term Loan Commitments or any Revolving Commitments of any Lender be increased or decreased as a result of a default by any other Lender in such other Lender’s obligation to make a Loan requested hereunder or purchase a participation required hereby.

(b)

Availability of Funds.  Unless the Administrative Agent shall have been notified by any Lender prior to the applicable Credit Date that such Lender does not intend to make available to the Administrative Agent the amount of such Lender’s Loan requested on such Credit Date, the Administrative Agent may assume that such Lender has made such amount available to the Administrative Agent on such Credit Date and the Administrative Agent may, in its sole discretion, but shall not be obligated to, make available to the Borrowers a corresponding amount on such Credit Date.  If such corresponding amount is not in fact made available to the Administrative Agent by such Lender, the Administrative Agent shall be entitled to recover such corresponding amount on demand from such Lender together with interest thereon, for each day from such Credit Date until the date such amount is paid to the Administrative Agent, at the customary rate set by the Administrative Agent for the correction of errors among banks for three (3) Business Days and thereafter, if such Loan is in Dollars, at the Base Rate, if such Loan is in Canadian Dollars, at the Canadian Prime Rate, and if such Loan is in Euros or any Other Foreign Currency, at the rate certified by the Administrative Agent to be its cost of funds (from any source which it may reasonably select).  If such Lender does not pay such corresponding amount forthwith upon the Administrative Agent’s demand therefor, the Administrative Agent shall promptly notify the Borrower Representative and the applicable Borrower shall immediately pay such corresponding amount to the Administrative Agent together with interest thereon, for each day from such Credit Date until the date such amount is paid to the Administrative Agent at the Base Rate if such Loan is in Dollars, at the Canadian Prime Rate if such Loan is in Canadian Dollars, and at the rate certified by the Administrative Agent to be its cost of funds (from any source which it may reasonably select) if such Loan is in Euros or any



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Other Foreign Currency.  Nothing in this Section 2.05(b) shall be deemed to relieve any Lender from its obligation to fulfill its Term Loan Commitments and Revolving Commitments hereunder or to prejudice any rights that the Borrowers may have against any Lender as a result of any default by such Lender hereunder.

Section 2.06

Use of Proceeds

.  The proceeds of the Term Loans shall be applied by the Borrowers to fund the Transactions. The proceeds of the Revolving Loans, Swing Line Loans, Letters of Credit and any loans under any Ancillary Facility made after the Closing Date shall be applied by the applicable Borrower for working capital or general corporate purposes of such Borrower or any of its Subsidiaries, including Permitted Acquisitions.  The proceeds of the Incremental Term Loans shall be applied by the applicable Borrower for working capital or general corporate purposes of such Borrower and its Subsidiaries, including Permitted Acquisitions.  No portion of the proceeds of any Credit Extension shall be used in any manner that causes or might cause such Credit Extension or the application of such proceeds to violate Regulation T, Regulation U or Regulation X of the Board of Governors or any other regulation thereof or to violate the Exchange Act.

Section 2.07

Evidence of Debt; Register; Notes

.  

(a)

Lenders’ Evidence of Debt.  Each Lender shall maintain on its internal records an account or accounts evidencing the Obligations of each Borrower to such Lender, including the amounts of the Loans made by it and each repayment and prepayment in respect thereof.  

(b)

Register.  The Administrative Agent (or its agent or sub-agent appointed by it) acting for this purpose as an agent of the Borrowers shall maintain at its Principal Office a register for the recordation of the names and addresses of Lenders and the Revolving Commitment and Loans of each Lender from time to time (the “Register”).  The Register shall be available for inspection by the Borrower Representative at any reasonable time and from time to time upon reasonable prior notice and upon request (which may not be made more than once per month) the Administrative Agent shall provide a copy of the information in the Register to the Borrower.  The Administrative Agent shall record, or shall cause to be recorded, in the Register the Revolving Commitments and the Loans in accordance with the provisions of Section 10.06, and each repayment or prepayment in respect of the principal amount of the Loans, and any such recordation shall be conclusive and binding on each Borrower and each Lender, absent manifest error.  Each Borrower hereby designates the Administrative Agent to serve as such Borrower’s agent solely for purposes of maintaining the Register as provided in this Section 2.07, and each Borrower hereby agrees that, to the extent the Administrative Agent serves in such capacity, the Administrative Agent and its officers, directors, employees, agents, sub-agents and Affiliates shall constitute “Indemnitees.”

(c)

Notes.  If so requested by any Lender by written notice to the Borrower Representative (with a copy to the Administrative Agent) at least five (5) Business Days prior to the Closing Date, or at any time thereafter, each applicable Borrower shall execute and deliver to such Lender (and/or, if applicable and if so specified in such notice, to any Person who is an assignee of such Lender pursuant to Section 10.06) on the Closing Date (or, if such notice is delivered after the Closing Date, promptly after such Borrower’s receipt of such notice) a Note



80






or Notes to evidence such Lender’s Tranche A Term Loans, Tranche B Term Loans, Incremental Term Loan, Revolving Loans or Swing Line Loan, as the case may be.

Section 2.08

Interest on Loans

.  

(a)

Except as otherwise set forth herein, each Class of Loan shall bear interest on the unpaid principal amount thereof from the date made through repayment (whether by acceleration or otherwise) thereof as follows:

(i)

in the case of Tranche A Term Loans and Revolving Loans:

(A)

if a Base Rate Loan, at the Base Rate plus the Applicable Margin;

(B)

if a Eurocurrency Rate Loan, at the Adjusted Eurocurrency Rate plus the Applicable Margin and plus Mandatory Costs, if any; or

(C)

if a Canadian Prime Rate Loan, at the Canadian Prime Rate plus the Applicable Margin;

(ii)

in the case of Swing Line Loans, at the Base Rate or the Canadian Prime Rate, as applicable, plus the Applicable Margin; and

(iii)

in the case of Tranche B Term Loans:

(A)

if a Base Rate Loan, at the Base Rate plus the Applicable Margin; or

(B)

if a Eurocurrency Rate Loan, at the Adjusted Eurocurrency Rate plus the Applicable Margin and plus Mandatory Costs, if any.

(b)

The Type of Loan (except a Swing Line Loan, which can be made and maintained as a Base Rate Loan or Canadian Prime Rate Loan only), and the Interest Period with respect to any Eurocurrency Rate Loan shall be selected by the applicable Borrower and notified to the Administrative Agent and Lenders pursuant to the applicable Borrowing Notice or Conver­sion/Continuation Notice, as the case may be; provided, that until the date on which the Arrangers notify the Borrower Representative that the primary syndication of the Loans and Revolving Commitments has been completed (which date shall be not later than twenty-eight (28) days after the Closing Date), the Term Loans shall be maintained as either (1) Eurocurrency Rate Loans having an Interest Period of no longer than one month or (2) Base Rate Loans (or Canadian Prime Rate Loans) or such shorter period as the U.S. Borrower and the Administrative Agent may agree.  If on any day a Loan is outstanding with respect to which a Borrowing Notice or Conversion/Continuation Notice has not been delivered to the Administrative Agent in accordance with the terms hereof specifying the applicable basis for determining the rate of interest, then for that day such Loan, if a Loan denominated in Dollars or Canadian Dollars, shall be a Base Rate Loan or a Canadian Prime Rate Loan, as applicable, and, if a Loan denominated in any other Approved Currency, shall be a Eurocurrency Rate Loan having an Interest Period of one month.



81






(c)

In connection with Eurocurrency Rate Loans there shall be no more than five (5) Interest Periods outstanding at any time in respect of each of the Tranche A Term Loans and the Tranche B Term Loans, no more than ten (10) Interest Periods outstanding at any time in respect of the U.S. Revolving Loans, no more than five (5) Interest Periods outstanding at any time in respect of the Canadian Revolving Loans, and no more than ten (10) Interest Periods outstanding at any time in respect of the Foreign Revolving Loans.  In the event the Borrower Representative fails to specify between a Base Rate Loan or a Eurocurrency Rate Loan in the applicable Borrowing Notice or Conversion/Continuation Notice for any Loan denominated in Dollars, such Loan (if outstanding as a Eurocurrency Rate Loan) shall be automatically converted into a Base Rate Loan on the last day of the then-current Interest Period for such Loan (or if outstanding as a Base Rate Loan shall remain as, or (if not then outstanding) shall be made as, a Base Rate Loan).  In the event the Borrower Representative fails to specify an Interest Period for any Eurocurrency Rate Loan in the applicable Borrowing Notice or Conversion/Continuation Notice, such Borrower shall be deemed to have selected an Interest Period of one month.  As soon as practicable after 10:00 a.m. (New York City time) or, with respect to Loans in respect of Foreign Revolving Commitments, 10:00 a.m. (London, England time), on each Interest Rate Determination Date, the Administrative Agent shall determine (which determination shall, absent manifest error, be final, conclusive and binding upon all parties) the interest rate that shall apply to the Eurocurrency Rate Loans for which an interest rate is then being determined for the applicable Interest Period and shall promptly give notice thereof (in writing or by telephone confirmed in writing) to the Borrower Representative and each Lender.  In the event that the Borrower Representative fails to specify between a Canadian Prime Rate Loan and a Eurocurrency Rate Loan in the applicable Borrowing Notice or Conver­sion/Continuation Notice for any Loan denominated in Canadian Dollars, such Loan (if outstanding as a Eurocurrency Rate Loan) shall be automatically converted into a Canadian Prime Rate Loan on the last day of the then-current Interest Period for such Loan (or if outstanding as a Canadian Prime Rate Loan shall remain as, or (if not then outstanding) shall be made as, a Canadian Prime Rate Loan).  

(d)

Interest payable pursuant to Section 2.08(a) shall be computed (i) in the case of Base Rate Loans and Canadian Prime Rate Loans on the basis of a 365-day or 366-day year, as the case may be and (ii) in the case of Eurocurrency Rate Loans, on the basis of a 360-day year, in each case for the actual number of days elapsed in the period during which it accrues.  In computing interest on any Loan, the date of the making of such Loan or the first day of an Interest Period applicable to such Loan or, with respect to a Term Loan, the last Interest Payment Date with respect to such Term Loan or, with respect to a Base Rate Loan being converted from a Eurocurrency Rate Loan, the date of conversion of such Eurocurrency Rate Loan to such Base Rate Loan, as the case may be, shall be included, and the date of payment of such Loan or the expiration date of an Interest Period applicable to such Loan or, with respect to a Base Rate Loan being converted to a Eurocurrency Rate Loan, the date of conversion of such Base Rate Loan to such Eurocurrency Rate Loan, as the case may be, shall be excluded; provided, that if a Loan is repaid on the same day on which it is made, one day’s interest shall be paid on that Loan.

(e)

Except as otherwise set forth herein, interest on each Loan shall accrue on a daily basis and shall be payable in arrears (i) on each Interest Payment Date with respect to interest accrued on and to each such payment date; (ii) upon any prepayment of such Loan,



82






whether voluntary or mandatory, to the extent accrued on the amount being prepaid; provided, that with respect to any voluntary prepayment of a Base Rate Loan and a Canadian Prime Rate Loans, accrued interest shall instead be payable on the applicable Interest Payment Date and (iii) at maturity of such Loan, including final maturity of such Loan.

(f)

The applicable Borrower agrees to pay to the Issuing Bank, with respect to drawings honored under a Letter of Credit, interest on the amount paid by the Issuing Bank in respect of each such honored drawing from the date such drawing is honored to but excluding the date such amount is reimbursed by or on behalf of the applicable Borrower at a rate equal to (i) for the period from the date such drawing is honored to but excluding the applicable Reimbursement Date, the rate of interest otherwise payable hereunder with respect to Revolving Loans that are Base Rate Loans (or if such Letter of Credit is denominated in Canadian Dollars, the Canadian Prime Rate) or, with respect to Letters of Credit denominated in a currency other than Dollars or Canadian Dollars, Eurocurrency Rate Loans with an Interest Period of one month, and (ii) thereafter, a rate which is 2.00% per annum in excess of the rate of interest otherwise payable hereunder with respect to such Revolving Loans.

(g)

Interest payable pursuant to Section 2.08(f) shall be computed on the basis of a 365/366-day year for the actual number of days elapsed in the period during which it accrues, and shall be payable on demand or, if no demand is made, on the date on which the related drawing under a Letter of Credit is reimbursed in full.  Promptly upon receipt by the Issuing Bank of any payment of interest pursuant to Section 2.08(f), the Issuing Bank shall distribute to each Lender, out of the interest received by the Issuing Bank in respect of the period from the date such drawing is honored to but excluding the date on which the Issuing Bank is reimbursed for the amount of such drawing (including any such reimbursement out of the proceeds of any Revolving Loans), the amount that such Lender would have been entitled to receive in respect of the letter of credit fee that would have been payable in respect of such Letter of Credit for such period if no drawing had been honored under such Letter of Credit.  In the event the Issuing Bank shall have been reimbursed by Lenders for all or any portion of such honored drawing, the Issuing Bank shall distribute to each Lender which has paid all amounts payable by it under Section 2.04(e) with respect to such honored drawing such Lender’s Pro Rata Share of any interest received by the Issuing Bank in respect of that portion of such honored drawing so reimbursed by Lenders for the period from the date on which the Issuing Bank was so reimbursed by Lenders to but excluding the date on which such portion of such honored drawing is reimbursed by the applicable Borrower.

(h)

The rate and time of payment of interest in respect of any Ancillary Facility shall be determined by agreement between the relevant Ancillary Lender and the Borrower under such Ancillary Facility based on normal market rates and terms.

(i)

For purposes of disclosure pursuant to the Interest Act (Canada), (i) whenever any interest under this Agreement is calculated using a rate based on a year of 360 days or 365 days, as the case may be, the rate determined pursuant to such calculation, when expressed as an annual rate, is equivalent to (x) the applicable rate based on a year of 360 days or 365 days, as the case may be, (y) multiplied by the actual number of days in the calendar year in which the period for which such interest or fee is payable (or compounded) ends, and (z) divided by 360 or 365, as the case may be, (ii) the principle of deemed reinvestment of interest does not



83






apply to any interest calculation under this Agreement, and (iii) the rates of interest stipulated in this Agreement are intended to be nominal rates and not effective rates or yields.

Section 2.09

Conversion/Continuation

.  

(a)

Subject to Section 2.18 and so long as no Default or Event of Default shall have occurred and then be continuing, the Borrowers shall have the option:

(i)

to convert at any time all or any part of any Term Loan or Revolving Loan denominated in Dollars or Canadian Dollars equal to $5,000,000 and integral multiples of $1,000,000 in excess of that amount from one Type of Loan to another Type of Loan; provided, that a Eurocurrency Rate Loan may only be converted on the expiration of the Interest Period applicable to such Eurocurrency Rate Loan unless the U.S. Borrower shall pay all amounts due under Section 2.18 in connection with any such conversion; or

(ii)

upon the expiration of any Interest Period applicable to any Eurocurrency Rate Loan, to continue all or any portion of such Loan equal to $5,000,000 and integral multiples of $1,000,000 in excess of that amount as a Eurocurrency Rate Loan;

provided that, for the avoidance of doubt, no conversion or continuation of any Loan pursuant to this Section shall affect the currency in which such Loan is denominated prior to any such conversion or continuation and each such Loan shall remain outstanding denominated in the currency originally issued.

(b)

The Borrower Representative shall deliver a Conversion/Continuation Notice to the Administrative Agent no later than 10:00 a.m. (New York City time) or, with respect to Loans in respect of Foreign Revolving Commitments, 10:00 a.m. (London, England time), at least one Business Day in advance of the proposed conversion date (in the case of a conversion to a Base Rate Loan or Canadian Prime Rate Loan) and at least three (3) Business Days in advance of the proposed Conversion/Continuation Date (in the case of a conversion to, or a continuation of, a Eurocurrency Rate Loan).  Except as otherwise provided herein, a Conversion/Continuation Notice for conversion to, or continuation of, any Eurocurrency Rate Loans, shall be irrevocable on and after the related Interest Rate Determination Date, and each Borrower shall be bound to effect a conversion or continuation in accordance therewith.

Section 2.10

Default Interest

.  Upon the occurrence and during the continuance of an Event of Default under Section 8.01(a), (c) (in the case of a failure to perform or comply with any term or condition contained in Section 6.07(a) or (b)), (f), (g), or (h) and, at the request of the Required Lenders, any other Event of Default, the principal amount of all Loans outstanding and, to the extent permitted by applicable law, any interest payments on the Loans or any fees or other amounts owed hereunder, shall thereafter bear interest (including post-petition interest in any proceeding under the Bankruptcy Code or other applicable bankruptcy laws) payable on demand at a rate (the “Default Rate”) that is 2.00% per annum in excess of the interest rate otherwise payable hereunder with respect to the applicable Loans (or, in the case of any such fees and other amounts, at a rate which is 2.00% per annum in excess of



84






the interest rate otherwise payable hereunder for Base Rate Loans that are Revolving Loans); provided, that in the case of Eurocurrency Rate Loans denominated in Dollars and Canadian Dollars, upon the expiration of the Interest Period in effect at the time any such increase in interest rate is effective such Eurocurrency Rate Loans shall thereupon become Base Rate Loans or Canadian Prime Rate Loans, as applicable, and shall thereafter bear interest payable upon demand at a rate which is 2.00% per annum in excess of the interest rate otherwise payable hereunder for Base Rate Loans.  Payment or acceptance of the increased rates of interest provided for in this Section 2.10 is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of the Administrative Agent or any Lender.

Section 2.11

Fees

.  

(a)

The U.S. Borrower agrees to pay to Lenders (other than Defaulting Lenders) having U.S. Revolving Exposure and Canadian Revolving Exposure, as applicable:

(i)

commitment fees equal to (1) the average of the daily difference between (a) the U.S. Revolving Commitments and (b) the aggregate principal amount of (x) all outstanding U.S. Revolving Loans plus (y) the U.S. Letter of Credit Usage, times (2) the Applicable Revolving Commitment Fee Percentage;

(ii)

commitment fees equal to (1) the average of the daily difference between (a) the Canadian Revolving Commitments and (b) the Dollar Equivalent of the aggregate principal amount of (x) all outstanding Canadian Revolving Loans plus (y) the Canadian Letter of Credit Usage, times (2) the Applicable Revolving Commitment Fee Percentage;

(iii)

letter of credit fees equal to (1) the Applicable Margin for U.S. Revolving Loans that are Eurocurrency Rate Loans, times (2) the average aggregate daily maximum amount available to be drawn under all such U.S. Letters of Credit (regardless of whether any conditions for drawing could then be met and determined as of the close of business on any date of determination); and

(iv)

letter of credit fees equal to (1) the Applicable Margin for Canadian Revolving Loans that are Eurocurrency Rate Loans, times (2) the Dollar Equivalent of the average aggregate daily maximum amount available to be drawn under all such Canadian Letters of Credit (regardless of whether any conditions for drawing could then be met and determined as of the close of business on any date of determination).

All fees referred to in this Section 2.11(a) shall be paid in Dollars to the Administrative Agent at its Principal Office and upon receipt, the Administrative Agent shall promptly distribute to each Lender that has Revolving Exposure its Pro Rata Share thereof.

(b)

The Foreign Borrower agrees to pay to Lenders (other than Defaulting Lenders) having Foreign Revolving Exposure:



85






(i)

commitment fees equal to (1) the average of the daily difference between (a) the Foreign Revolving Commitments and (b) the Euro Equivalent of the aggregate principal amount of (x) all outstanding Foreign Revolving Loans plus (y) the Foreign Letter of Credit Usage, times (2) the Applicable Revolving Commitment Fee Percentage; and

(ii)

letter of credit fees equal to (1) the Applicable Margin for Foreign Revolving Loans, times (2) the Euro Equivalent of the average aggregate daily maximum amount available to be drawn under all such Foreign Letters of Credit (regardless of whether any conditions for drawing could then be met and determined as of the close of business on any date of determination).

All fees referred to in this Section 2.11(b) shall be paid in Euros to the Administrative Agent at its applicable Principal Office and upon receipt, the Administrative Agent shall promptly distribute to each Lender that has Revolving Exposure its Pro Rata Share thereof.

(c)

Letter of Credit Fees.  

(i)

The U.S. Borrower agrees to pay directly to the applicable Issuing Bank, for its own account, with respect to any standby U.S. Letters of Credit and standby Canadian Letters of Credit a fronting fee in Dollars equal to 0.250%, per annum, times the average aggregate daily maximum amount available to be drawn under all such U.S. Letters of Credit and Canadian Letters of Credit (determined as of the close of business on any date of determination).

(ii)

The Foreign Borrower agrees to pay directly to the applicable Issuing Bank, for its own account, with respect to any standby Foreign Letters of Credit a fronting fee in Euros equal to 0.250%, per annum, times the average aggregate daily maximum amount available to be drawn under all such Foreign Letters of Credit (determined as of the close of business on any date of determination).

(iii)

The applicable Borrower agrees to pay fees to be agreed with the applicable Issuing Bank in respect of all commercial Letters of Credit.

(iv)

The applicable Borrower agrees to pay such documentary and processing charges for any issuance, amendment, transfer or payment of a Letter of Credit as are in accordance with the applicable Issuing Bank’s standard schedule for such charges and as in effect at the time of such issuance, amendment, transfer or payment, as the case may be.

(d)

All fees referred to in Section 2.11(a), 2.11(b), 2.11(c)(i) and 2.11(c)(ii) shall be calculated on the basis of a 360-day year and the actual number of days elapsed and shall be payable quarterly in arrears on March 31, June 30, September 30 and December 31 of each year during the applicable Revolving Commitment Period, commencing on the first such date to occur after the Closing Date, and on the applicable Revolving Commitment Termination Date.

(e)

In addition to any of the foregoing fees, the Borrowers agree to pay to Agents such other fees (such as administrative agency fees) in the amounts and at the times



86






separately agreed upon.  The rate and timing of fees in respect of any Ancillary Facility shall be determined by agreement between the relevant Ancillary Lender and the Borrower under such Ancillary Facility based on normal market rates and terms.  Certain fees separately agreed shall be payable to the Lenders on the Closing Date as fee compensation for the funding of such Lender’s Loans as availability of such Lender’s unfunded Revolving Commitment.  Such closing fees shall be in all respect earned, due and payable on the Closing Date and non-refundable and non-creditable thereafter.

Section 2.12

Scheduled Payments/Commitment Reductions

.  

(a)

The principal amounts of the U.S. Tranche A Term Loans shall be repaid in consecutive quarterly installments (each, an “Installment”) in the aggregate amounts set forth below on the dates set forth below (each, an “Installment Date”), commencing on September 30, 2010:

Amortization Date

U.S. Tranche A Term Loan Installments

September 30, 2010

$4,596,250

December 31, 2010

$4,596,250

March 31, 2011

$4,596,250

June 30, 2011

$4,596,250

September 30, 2011

$9,192,500

December 31, 2011

$9,192,500

March 31, 2012

$9,192,500

June 30, 2012

$9,192,500

September 30, 2012

$13,788,750

December 31, 2012

$13,788,750

March 31, 2013

$13,788,750

June 30, 2013

$13,788,750

September 30, 2013

$22,981,250

December 31, 2013

$22,981,250

March 31, 2014

$22,981,250

June 30, 2014

$22,981,250

September 30, 2014

$41,366,250

December 31, 2014

$41,366,250

March 31, 2015

$41,366,250

Tranche A Term Loan Maturity Date

Remainder




87






(b)

The principal amounts of the Foreign Tranche A Term Loans shall be repaid in Installments in the aggregate amounts set forth below on the Installment Dates set forth below, commencing on September 30, 2010:

Amortization Date

Foreign Tranche A Term Loan Installments

September 30, 2010

1,250,000

December 31, 2010

1,250,000

March 31, 2011

1,250,000

June 30, 2011

1,250,000

September 30, 2011

2,500,000

December 31, 2011

2,500,000

March 31, 2012

2,500,000

June 30, 2012

2,500,000

September 30, 2012

3,750,000

December 31, 2012

3,750,000

March 31, 2013

3,750,000

June 30, 2013

3,750,000

September 30, 2013

6,250,000

December 31, 2013

6,250,000

March 31, 2014

6,250,000

June 30, 2014

6,250,000

September 30, 2014

11,250,000

December 31, 2014

11,250,000

March 31, 2015

11,250,000

Tranche A Term Loan Maturity Date

Remainder


(c)

The principal amounts of the U.S. Tranche B Term Loans shall be repaid in Installments in the aggregate amounts set forth below on the Installment Dates set forth below, commencing on September 30, 2010:

Amortization Date

U.S. Tranche B Term Loan Installments

September 30, 2010

$2,507,750

December 31, 2010

$2,507,750

March 31, 2011

$2,507,750

June 30, 2011

$2,507,750



88








September 30, 2011

$2,507,750

December 31, 2011

$2,507,750

March 31, 2012

$2,507,750

June 30, 2012

$2,507,750

September 30, 2012

$2,507,750

December 31, 2012

$2,507,750

March 31, 2013

$2,507,750

June 30, 2013

$2,507,750

September 30, 2013

$2,507,750

December 31, 2013

$2,507,750

March 31, 2014

$2,507,750

June 30, 2014

$2,507,750

September 30, 2014

$2,507,750

December 31, 2014

$2,507,750

March 31, 2015

$2,507,750

June 30, 2015

$2,507,750

September 30, 2015

$2,507,750

December 30, 2015

$2,507,750

March 31, 2016

$2,507,750

Tranche B Term Loan Maturity Date

Remainder


(d)

The principal amounts of the Foreign Tranche B Term Loans shall be repaid in Installments in the aggregate amounts set forth below on the Installment Dates set forth below, commencing on September 30, 2010:

Amortization Date

Foreign Tranche B Term Loan Installments

September 30, 2010

750,000

December 31, 2010

750,000

March 31, 2011

750,000

June 30, 2011

750,000

September 30, 2011

750,000

December 31, 2011

750,000

March 31, 2012

750,000



89








June 30, 2012

750,000

September 30, 2012

750,000

December 31, 2012

750,000

March 31, 2013

750,000

June 30, 2013

750,000

September 30, 2013

750,000

December 31, 2013

750,000

March 31, 2014

750,000

June 30, 2014

750,000

September 30, 2014

750,000

December 31, 2014

750,000

March 31, 2015

750,000

June 30, 2015

750,000

September 30, 2015

750,000

December 30, 2015

750,000

March 31, 2016

750,000

Tranche B Term Loan Maturity Date

Remainder


(e)

Notwithstanding the foregoing, (x) such Installments shall be reduced in connection with any voluntary or mandatory prepayments of the Tranche A Term Loans or the Tranche B Term Loans, as the case may be, in accordance with Sections 2.13, 2.14 and 2.15, as applicable; and (y) the Tranche A Term Loans and the Tranche B Term Loans, together with all other amounts owed hereunder with respect thereto, shall, in any event, be paid in full no later than the Tranche A Term Loan Maturity Date and the Tranche B Term Loan Maturity Date, respectively.

Section 2.13

Voluntary Prepayments/Commitment Reductions

.

(a)

Voluntary Prepayments.  

(i)

Any time and from time to time (1) with respect to Base Rate Loans or Canadian Prime Rate Loans, the U.S. Borrower may prepay any such Loans on any Business Day in whole or in part, in an aggregate minimum amount of $5,000,000 and integral multiples of $1,000,000 in excess of that amount; (2) with respect to Eurocurrency Rate Loans, the applicable Borrower may prepay any such Loans on any Business Day in whole or in part in an aggregate minimum amount of, with respect to Loans denominated in Dollars or Canadian Dollars and U.S. Revolving Loans or Canadian Revolving Loans, $5,000,000 and integral multiples of $1,000,000 in excess of



90






that amount, and, with respect to Loans denominated in Euros and all Foreign Revolving Loans, 5,000,000 and integral multiples of 1,000,000 in excess of that amount; and (3) with respect to Swing Line Loans, the U.S. Borrower may prepay any such Loans on any Business Day in whole or in part in an aggregate minimum amount of $500,000, and in integral multiples of $100,000 in excess of that amount.

(ii)

All such prepayments shall be made (1) upon not less than one Business Day’s prior written notice in the case of Base Rate Loans or Canadian Prime Rate Loans; (2) upon not less than three (3) Business Days’ prior written notice in the case of Eurocurrency Rate Loans and (3) upon written notice on the date of prepayment, in the case of Swing Line Loans;

in each case given to the Administrative Agent or applicable Swing Line Lender, as the case may be, by 12:00 p.m. (New York City time) (or, with respect to repayments of Foreign Loans, 12:00 p.m. London, England time) on the date required (and the Administrative Agent or such Swing Line Lender, as the case may be, shall promptly transmit such original notice by telefacsimile or telephone to each Lender).  Upon the giving of any such notice, the principal amount of the Loans specified in such notice shall become due and payable on the prepayment date specified therein; provided that such a notice may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower Representative if such condition is not satisfied.  Any such voluntary prepayment shall be applied as specified in Section 2.15(a).

(b)

Voluntary Commitment Reductions.   

(i)

The Borrower Representative may, upon not less than three (3) Business Days’ prior written notice confirmed in writing to the Administrative Agent (which original written notice the Administrative Agent shall promptly transmit by telefacsimile or telephone to each applicable Lender), at any time and from time to time terminate in whole or permanently reduce in part, without premium or penalty, the U.S. Revolving Commitments, the Canadian Revolving Commitments and/or the Foreign Revolving Commitments in an amount up to the amount by which (x) the U.S. Revolving Commitments exceed the Total Utilization of U.S. Revolving Commitments, (y) the Canadian Revolving Commitments exceed the Total Utilization of Canadian Revolving Commitments or (z) the Foreign Revolving Commitments exceed the Total Utilization of Foreign Revolving Commitments, as applicable, at the time of such proposed termination or reduction; provided, that any such partial reduction of the Revolving Commitments shall be in an aggregate minimum amount of, with respect to U.S. Revolving Commitments and Canadian Revolving Commitments, $5,000,000 and integral multiples of $1,000,000 in excess of that amount, and, with respect to Foreign Revolving Commitments, 5,000,000 and integral multiples of 1,000,000 in excess of that amount.

(ii)

The Borrower Representatives notice to the Administrative Agent shall designate the date (which shall be a Business Day) of such termination or reduction and the amount of any partial reduction, and such termination or reduction of the Revolving Commitments shall be effective on the date specified in the Borrower Representative’s notice and shall reduce the applicable Revolving Commitments of each



91






Lender proportionately to its Pro Rata Share thereof; provided that such a notice may state that such notice is conditioned upon the effectiveness of other credit facilities, in which case such notice may be revoked by the Borrower Representative if such conditions is not satisfied.

(c)

Below-Par Purchases.  Notwithstanding anything to the contrary contained in this Section 2.13 or any other provision of this Agreement and without otherwise limiting the rights in respect of prepayments of the Loans of the U.S. Borrower and its Subsidiaries, so long as no Default or Event of Default has occurred and is continuing, either Borrower may repurchase outstanding Term Loans pursuant to this Section 2.13(c) on the following basis:

(i)

The U.S. Borrower may make one or more offers (each, a “U.S. Offer”) to repurchase all or any portion of the U.S. Tranche A Term Loans and U.S. Tranche B Term Loans (such Term Loans, the “U.S. Offer Loans”), and the Foreign Borrower may make one or more offers (each, a “Foreign Offer” and, together with each U.S. Offer, an “Offer”) to repurchase all or any portion of the Foreign Tranche A Term Loans and Foreign Tranche B Term Loans (such Term Loans, the “Foreign Offer Loans” and, together with the U.S. Offer Loans, the “Offer Loans”); provided that, (A) the applicable Borrower delivers notice of its intent to make such Offer to the Administrative Agent at least five Business Days in advance of the launch of any proposed Offer, (B) upon the launch of such proposed Offer, the applicable Borrower delivers an irrevocable notice of such Offer to all applicable Term Lenders (with a copy to the Administrative Agent) indicating (1) the last date on which such Offer may be accepted, (2) the maximum dollar amount of such U.S. Offer or maximum Euro amount of such Foreign Offer, as applicable, and (3) the repurchase price per dollar of principal amount of such U.S. Offer Loans or the repurchase price per Euro of principal amount of such Foreign Offer Loans, as applicable, at which the applicable Borrower is willing to repurchase such Offer Loans (which price shall be below par), (C) the maximum dollar amount of each U.S. Offer and the maximum Euro amount of each Foreign Offer shall be an amount reasonably determined by the applicable Borrower in consultation with the Administrative Agent prior to the making of any such Offer; (D) the Borrower shall hold such Offer open for a minimum period of days to be reasonably determined by the Administrative Agent and the applicable Borrower prior to the making of any such Offer; (E) a Term Lender who elects to participate in the Offer may choose to sell all or part of such Term Lender’s Offer Loans; (F) such Offer shall be made to all Term Lenders holding the Offer Loans on a pro rata basis in accordance with the respective principal amount then due and owing to the Term Lenders; provided, further that, if any Term Lender elects not to participate in the Offer, either in whole or in part, the amount of such Term Lender’s Offer Loans not being tendered shall be excluded in calculating the pro rata amount applicable to the balance of such Offer Loans and (G) such Offer shall be conducted pursuant to such procedures the Administrative Agent may establish in consultation with the applicable Borrower (which shall be consistent with this Section 2.13(c)) and that a Lender must follow in order to have its Offer Loans repurchased, which procedures may include a requirement that that the applicable Borrower represent and warrant that it does not have any material non-public information with respect to any Loan Party (or its Subsidiaries) that could be material to a Lender’s decision to participate in such Offer;



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(ii)

With respect to all repurchases made by the applicable Borrower such repurchases shall be deemed to be voluntary prepayments pursuant to this Section 2.13 in an amount equal to the aggregate principal amount of such Term Loans, provided that such repurchases shall not be subject to the provisions of paragraphs (a) and (b) of this Section 2.13 or Section 2.17;

(iii)

Upon the purchase by the applicable Borrower of any Term Loans, (A) automatically and without the necessity of any notice or any other action, all principal and accrued and unpaid interest on the Term Loans so repurchased shall be deemed to have been paid for all purposes and shall be cancelled and no longer outstanding for all purposes of this Agreement and all other Loan Documents (and in connection with any Term Loan purchased pursuant to this Section 2.13(c), the Administrative Agent is authorized to make appropriate entries in the Register to reflect such cancellation) and (B) the applicable Borrower will promptly advise the Administrative Agent of the total amount of Offer Loans that were repurchased from each Lender who elected to participate in the Offer;

(iv)

Failure by the Borrowers to make any payment to a Lender required by an agreement permitted by this Section 2.13(c) shall not constitute an Event of Default under Section 8.01(a);

(v)

No proceeds of any Revolving Loans may be used to purchase any Offer Loans, and all amounts used to purchase Offer Loans shall be deemed to be a use of the Available Amount; and

(vi)

The amount of such repurchases (based on the face value of the Term Loans purchased thereby) shall be applied on a pro rata basis to reduce the remaining Installments on the applicable Class of Term Loans pursuant to Section 2.12.

Section 2.14

Mandatory Prepayments/Commitment Reductions

.  

(a)

Asset Sales.  No later than ten (10) Business Days following the date of receipt by any Group Member of any Net Cash Proceeds in respect of any Asset Sale pursuant to Section 6.08(d), 6.08(j)(ii) or 6.08(k), the Term Loans shall be repaid as set forth in Section 2.15(b) in an aggregate amount equal to such Net Cash Proceeds; provided, that so long as no Default or Event of Default shall have occurred and be continuing, the Borrower Representative shall have the option, upon written notice to the Administrative Agent, directly or through one or more of its Subsidiaries, to invest such Net Cash Proceeds within three hundred sixty-five (365) days of receipt thereof in Additional Assets, which investment may include the repair, restoration or replacement of the applicable assets thereof, to the extent such investments are otherwise permitted under this Agreement.

(b)

Insurance/Condemnation Proceeds.  No later than ten (10) Business Days following the date of receipt by any Group Member, or the Administrative Agent as loss payee, of any Net Cash Proceeds of the type described in clause (b) of the definition thereof, the Term Loans shall be repaid as set forth in Section 2.15(b) in an aggregate amount equal to such Net Cash Proceeds; provided, that so long as no Default or Event of Default shall have occurred and



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be continuing, the Borrower Representative shall have the option, upon written notice to the Administrative Agent, directly or through one or more of its Subsidiaries to invest such Net Cash Proceeds within three hundred sixty-five (365) days of receipt thereof in Additional Assets, which Investment may include the repair, restoration or replacement of the applicable assets thereof.

(c)

Issuance or Incurrence of Debt.  No later than one (1) Business Day following the date of receipt by any Group Member of any Net Cash Proceeds from the issuance or incurrence of any Indebtedness of any Group Member (other than with respect to any Indebtedness permitted to be incurred pursuant to Section 6.01, but including Indebtedness permitted to be incurred pursuant to Sections 6.01(d)(1)(ii) (except for Indebtedness incurred for the purpose of repaying Revolving Loans), 6.01(n)(i) and 6.01(n)(ii), the Net Cash Proceeds of which are required to prepay Term Loans, which Net Cash Proceeds shall be applied not later than five (5) Business Days after receipt to the extent necessary to allow the Borrowers to comply with Section 2.15(c)), the Term Loans shall be prepaid by the applicable Borrower as set forth in Section 2.15(b) in an aggregate amount equal to 100.0% of such Net Cash Proceeds.

(d)

Consolidated Excess Cash Flow.  In the event that there shall be Consolidated Excess Cash Flow for any Fiscal Year (commencing with the Fiscal Year ending January 30, 2011), no later than ninety (90) days after the end of such Fiscal Year, the Term Loans shall be prepaid by the applicable Borrower as set forth in Section 2.15(b) in an aggregate amount equal to (i) 50% of such Consolidated Excess Cash Flow minus (ii) voluntary repayments of the Term Loans pursuant to Section 2.13(a); provided, that if, as of the last day of the most recently ended Fiscal Year, the Leverage Ratio (determined for any such period by reference to the Compliance Certificate delivered pursuant to Section 5.01(c) calculating the Leverage Ratio as of the last day of such Fiscal Year) shall be (x) less than 2.50:1.00 but at least 2.00:1.00, the U.S. Borrower shall only be required to make the prepayments and/or reductions otherwise required hereby in an amount equal to (i) 25% of such Consolidated Excess Cash Flow minus (ii) voluntary repayments of the Loans (excluding repayments of Revolving Loans or Swing Line Loans except to the extent the Revolving Commitments are permanently reduced in connection with such repayments) or (y) less than 2.00:1.00, no such payment shall be required.

(e)

Revolving Loans, Swing Line Loans and Letters of Credit.  The applicable Borrower shall from time to time (i) prepay first, the Swing Line Loans, and second, the Revolving Loans and (ii) if all such Loans are prepaid without exhausting the excess referred to below, Cash Collateralize outstanding Letters of Credit, in each case, to the extent necessary so that (x) the Total Utilization of U.S. Revolving Commitments shall not at any time exceed the U.S. Revolving Commitments then in effect, (y) the Total Utilization of Canadian Revolving Commitments shall not at any time exceed the Canadian Revolving Commitments then in effect and (z) the Total Utilization of Foreign Revolving Commitments shall not at any time exceed the Foreign Revolving Commitments then in effect.  Notwithstanding the foregoing, mandatory prepayments of Swing Line Loans and Revolving Loans and Cash Collateralization of Letters of Credit that would otherwise be required pursuant to this Section 2.14(e) solely as a result of fluctuations in Exchange Rates from time to time shall only be required to be made on the last Business Day of each month on the basis of the Exchange Rate in effect on such Business Day.



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(f)

Prepayment Certificate.  Concurrently with any prepayment of the Term Loans pursuant to Sections 2.14(a) through 2.14(d), the Borrower Representative shall deliver to the Administrative Agent a certificate of an Authorized Officer demonstrating the calculation of the amount of the applicable Net Cash Proceeds or Consolidated Excess Cash Flow, as the case may be.  In the event that the Borrower Representative shall subsequently determine that the actual amount received exceeded the amount set forth in such certificate, the applicable Borrower shall promptly make an additional prepayment of the Term Loans in an amount equal to such excess, and the Borrower Representative shall concurrently therewith deliver to the Administrative Agent a certificate of an Authorized Officer describing such excess.

Section 2.15

Application of Prepayments/Reductions; Application of Proceeds of Collateral

.

(a)

Application of Voluntary Prepayments by Type of Loans.  Any prepayment of any Loan pursuant to Section 2.13(a) shall be applied as specified by the applicable Borrower in the applicable notice of prepayment; provided that any voluntary prepayment pursuant to Section 2.13(a) of Term Loans must be made pro rata to all Term Loans (but may be applied to the Installments thereof as determined by the Borrower Representative); provided, further, that in the event the applicable Borrower fails to specify the Loans to which any such prepayment shall be applied, such prepayment shall be applied as follows:

first, to repay outstanding Swing Line Loans to the full extent thereof;

second, to repay outstanding Revolving Loans to the full extent thereof; and

third, to prepay the Term Loans on a pro rata basis (in accordance with the respective outstanding principal amounts thereof); and applied to reduce in direct order of maturity the next four scheduled Installments of the Tranche A Term Loans and Tranche B Term Loans due and thereafter on a pro rata basis to reduce the scheduled remaining Installments of the Tranche A Term Loans and Tranche B Term Loans;

in each case, for the avoidance of doubt, allocated on a pro rata basis among the applicable U.S. Loans and Foreign Loans.

(b)

Application of Mandatory Prepayments by Type of Loans.  Any amount required to be paid pursuant to Sections 2.14(a) through 2.14(d) shall be applied to prepay Term Loans on a pro rata basis in accordance with the respective outstanding principal amounts thereof and further applied to reduce in direct order of maturity the next four scheduled Installments due and thereafter on a pro rata basis to the remaining scheduled Installments of principal of the Tranche A Term Loans and Tranche B Term Loans, in each case, for the avoidance of doubt, allocated on a pro rata basis among the applicable U.S. Loans and Foreign Loans.

(c)

Waivable Mandatory Prepayment.  Anything contained herein to the contrary notwithstanding, so long as any Tranche A Term Loans are outstanding, in the event the Borrower Representative is required to make any mandatory prepayment (a “Waivable Mandatory Prepayment”) of the Tranche B Term Loans, pursuant to Section 2.14, not less than five (5) Business Days prior to the date (the “Required Prepayment Date”) on which the



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Borrower Representative is required to make such Waivable Mandatory Prepayment, the Borrower Representative shall notify the Administrative Agent of the amount of such prepayment, and the Administrative Agent shall promptly thereafter notify each Lender holding an outstanding Tranche B Term Loan of the amount of such Lender’s Pro Rata Share of such Waivable Mandatory Prepayment and such Lender’s option to refuse such amount.  Each such Lender may exercise such option by giving written notice to the Borrower Representative and the Administrative Agent of its election to do so on or before the third Business Day prior to the Required Prepayment Date (it being understood that any Lender which does not notify the Borrower Representative and the Administrative Agent of its election to exercise such option on or before the third Business Day prior to the Required Prepayment Date shall be deemed to have elected, as of such date, not to exercise such option).  On the Required Prepayment Date, the applicable Borrower shall pay to the Administrative Agent the amount of the Waivable Mandatory Prepayment, which amount shall be applied (i) in an amount equal to that portion of the Waivable Mandatory Prepayment payable to those Lenders that have elected not to exercise such option, to prepay the Tranche B Term Loans of such Lenders (which prepayment shall be applied to the scheduled Installments of principal of the Tranche B Term Loans in accordance with Section 2.15(b)), and (ii) in an amount equal to that portion of the Waivable Mandatory Prepayment otherwise payable to those Lenders that have elected to exercise such option, to prepay the Tranche A Term Loans (which prepayment shall be applied to the scheduled Installments of principal of the Tranche A Term Loans in accordance with Section 2.15(b) and further applied to the scheduled Installments of principal of the Tranche B Term Loans in accordance with Section 2.15(b)).

(d)

Application of Prepayments of Loans to Base Rate Loans and Eurocurrency Rate Loans.  Considering each Class of Loans being prepaid separately, any prepayment of U.S. Loans shall be applied first to Base Rate Loans and Canadian Prime Rate Loans to the full extent thereof before application to Eurocurrency Rate Loans, in each case in a manner which minimizes the amount of any payments required to be made by the U.S. Borrower pursuant to Section 2.18(c).

(e)

Application of Proceeds of Collateral.  

(i)

Except as expressly set forth in clause (ii) below, all proceeds received by the Administrative Agent from the Collateral Agent in respect of any sale of, any collection from, or other realization upon all or any part of the Collateral shall be applied in full or in part by the Administrative Agent against, the Obligations in the following order of priority:  first, to the payment of all costs and expenses of such sale, collection or other realization, including reasonable compensation to the Administrative Agent and its agents and counsel, and all other expenses, liabilities and advances made or incurred by the Administrative Agent in connection therewith, and all amounts for which the Administrative Agent is entitled to indemnification hereunder (in its capacity as the Administrative Agent and not as a Lender) and all advances made by the Administrative Agent hereunder for the account of the applicable Loan Party, and to the payment of all costs and expenses paid or incurred by the Administrative Agent in connection with the exercise of any right or remedy hereunder or under the Credit Agreement, all in accordance with the terms hereof or thereof; second, to the extent of any excess of such proceeds, to repay any outstanding Swing Line Loans and amounts drawn under Letters



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of Credit and not reimbursed by the applicable Borrower or the applicable Revolving Lenders; third, to the extent of any excess of such proceeds, to the payment of all other Obligations for the ratable benefit of the Lenders and the Lender Counterparties holding such Obligations; and fourth, to the extent of any excess of such proceeds, to the payment to or upon the order of the applicable Loan Party or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct.

(ii)

All proceeds received by the Administrative Agent from the Collateral Agent in respect of any sale of, any collection from, or other realization upon all or any part of the Collateral of the Foreign Borrower or Foreign Guarantors shall be applied in full or in part by the Administrative Agent against, the Foreign Obligations in the following order of priority:  first, to the payment of all costs and expenses of such sale, collection or other realization, including reasonable compensation to the Administrative Agent and its agents and counsel, and all other expenses, liabilities and advances made or incurred by the Administrative Agent in connection therewith, and all amounts for which the Administrative Agent is entitled to indemnification hereunder (in its capacity as the Administrative Agent and not as a Lender) and all advances made by the Administative Agent hereunder for the account of the applicable Loan Party, and to the payment of all costs and expenses paid or incurred by the Administrative Agent in connection with the exercise of any right or remedy hereunder or under the Credit Agreement, all in accordance with the terms hereof or thereof; second, to the extent of any excess of such proceeds, to repay any outstanding amounts drawn under Foreign Letters of Credit and not reimbursed by the applicable Borrower or the applicable Revolving Lenders; third, to the extent of any excess of such proceeds, to the payment of all other Foreign Obligations for the ratable benefit of the Lenders and the Lender Counterparties holding such Foreign Obligations; and fourth, to the extent of any excess of such proceeds, to the payment to or upon the order of the applicable Loan Party or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct.

(iii)

It is acknowledged and agreed that the Collateral Agent will distribute proceeds of Collateral to the Administrative Agent and, as applicable, the 2023 Debentures Trustee, as required by the terms of the Security Documents or the 2023 Debentures Intercreditor Agreement.  

Section 2.16

General Provisions Regarding Payments

.  

(a)

All payments by the Borrowers of principal, interest, fees and other Obligations shall be made, with respect to the U.S. Loans or the U.S. Revolving Commitments,   in Dollars, and, with respect to the Foreign Loans or the Foreign Revolving Commitments, in Euros, in each case in same day funds, without defense, setoff or counterclaim, free of any restriction or condition, and delivered to the Administrative Agent not later than 12:00 p.m. (New York City time) or, with respect to Foreign Loans or Foreign Revolving Commitments, 12:00 p.m. (London, England time), on the date due at the Principal Office designated by the Administrative Agent for the account of Lenders.  For purposes of computing interest and fees, funds received by the Administrative Agent after that time on such due date shall be deemed to have been paid by the Borrowers on the next succeeding Business Day.



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(b)

All payments in respect of the principal amount of any Loan (other than voluntary prepayments of Revolving Loans, Base Rate Loans or Canadian Prime Rate Loans) shall be accompanied by payment of accrued interest on the principal amount being repaid or prepaid, and all such payments (and, in any event, any payments in respect of any Loan on a date when interest is due and payable with respect to such Loan) shall be applied to the payment of interest then due and payable before application to principal.

(c)

The Administrative Agent (or its agent or sub-agent appointed by it) shall promptly distribute to each Lender at such address as such Lender shall indicate in writing, such Lender’s applicable Pro Rata Share of all payments and prepayments of principal and interest due hereunder, together with all other amounts due thereto, including all fees payable with respect thereto, to the extent received by the Administrative Agent.

(d)

Notwithstanding the foregoing provisions hereof, if any Conversion/ Continuation Notice is withdrawn as to any Affected Lender or if any Affected Lender makes Base Rate Loans in lieu of its Pro Rata Share of any Eurocurrency Rate Loans, the Administrative Agent shall give effect thereto in apportioning payments received thereafter.

(e)

Subject to the provisos set forth in the definition of “Interest Period” as they may apply to Revolving Loans, whenever any payment to be made hereunder with respect to any Loan shall be stated to be due on a day that is not a Business Day, such payment shall be made on the next succeeding Business Day and, with respect to Revolving Loans only, such extension of time shall be included in the computation of the payment of interest hereunder or of the Revolving Commitment fees hereunder.

(f)

The Administrative Agent shall deem any payment by or on behalf of any Borrower hereunder that is not made in same day funds prior to 12:00 p.m. (New York City time) or, with respect to Foreign Loans or Foreign Revolving Commitments, 12:00 p.m. (London, England time), to be a non-conforming payment.  Any such payment shall not be deemed to have been received by the Administrative Agent until the later of (i) the time such funds become available funds, and (ii) the applicable next Business Day.  The Administrative Agent shall give prompt telephonic notice to the Borrower Representative and each applicable Lender (confirmed in writing) if any payment is non-conforming.  Any non-conforming payment may constitute or become a Default or Event of Default in accordance with the terms of Section 8.01(a).  

(g)

If an Event of Default shall have occurred and not otherwise been waived, and the maturity of the Obligations shall have been accelerated pursuant to Section 8.01, all payments or proceeds received by Agents hereunder in respect of any of the Obligations, shall be applied in accordance with the application arrangements described in Section 2.15(e).

(h)

If a CKI Blockage Event has occurred and is continuing, any payment, including any prepayments or distribution of any kind or character (whether required by this Agreement or optionally made by any Loan Party) shall be accompanied by a certificate, duly executed by an Authorized Officer of the U.S. Borrower stating that no part of such payment or distribution constitutes a CK Distribution, and such reasonable evidence as the Administrative Agent may reasonably request supporting such certification.



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Section 2.17

Ratable Sharing

.  The Lenders to the U.S. Borrower agree among themselves, on the one hand, and the Lenders to the Foreign Borrower hereby agree among themselves, on the other hand, that, except as otherwise provided in the Security Documents with respect to amounts realized from the exercise of rights with respect to Liens on the Collateral, if any of them shall, whether by voluntary payment (other than a voluntary prepayment of Loans made and applied in accordance with the terms hereof), through the exercise of any right of set-off or banker’s lien, by counterclaim or cross action or by the enforcement of any right under the Loan Documents or otherwise, or as adequate protection of a deposit treated as cash collateral under the Bankruptcy Code, receive payment or reduction of a proportion of the aggregate amount of principal, interest, amounts payable in respect of Letters of Credit, fees and other amounts then due and owing to such Lender hereunder or under the other Loan Documents (collectively, the “Aggregate Amounts Due” to such Lender) which is greater than the proportion received by any other Lender in respect of the Aggregate Amounts Due to such other Lender, then the Lender receiving such proportionately greater payment shall (a) notify the Administrative Agent and each other Lender of the receipt of such payment and (b) apply a portion of such payment to purchase participations (which it shall be deemed to have purchased from each seller of a participation simultaneously upon the receipt by such seller of its portion of such payment) in the Aggregate Amounts Due to the other Lenders so that all such recoveries of Aggregate Amounts Due shall be shared by all Lenders in proportion to the Aggregate Amounts Due to them; provided, that if all or part of such proportionately greater payment received by such purchasing Lender is thereafter recovered from such Lender upon the bankruptcy or reorganization of any Borrower or otherwise, those purchases shall be rescinded and the purchase prices paid for such participations shall be returned to such purchasing Lender ratably to the extent of such recovery, but without interest.  The provisions of this Section 2.17 shall not be construed to apply to (a) any payment made by any Borrower pursuant to and in accordance with the express terms of this Agreement or payments made with proceeds of Collateral applied as set forth in Section 2.15(e) or (b) any payment obtained by any Lender as consideration for the assignment or sale of a participation in any of its Loans or other Obligations owed to it.  For the avoidance of doubt no Lender to the Foreign Borrower shall make payments to a Lender to the U.S. Borrower pursuant to this Section 2.17.

Section 2.18

Making or Maintaining Eurocurrency Rate Loans

.  

(a)

Inability to Determine Applicable Interest Rate.  In the event of any Market Disruption, the Administrative Agent shall on such date give notice (by telefacsimile or by telephone confirmed in writing) to the Borrower Representative and each Lender of such determination, whereupon (i) with respect to Loans denominated in Dollars or Canadian Dollars, (x) no Loans may be made as, or converted to, Eurocurrency Rate Loans until such time as the Administrative Agent notifies the Borrower Representative and Lenders that the circumstances giving rise to such notice no longer exist and (y) any Borrowing Notice or Conversion/Continuation Notice given by the Borrower Representative with respect to the Loans in respect of which such determination was made shall be deemed to be rescinded by the Borrower Representative, and (ii) with respect to Loans denominated in Euros or Other Foreign Currency, if the Administrative Agent or the Borrower Representative so require, the Administrative Agent and the Borrower Representative will negotiate in good faith for a period of not more than 30 days in order to agree on a mutually acceptable substitute basis for calculating the interest payable on the affected Eurocurrency Rate Loans and, (x) if a substitute



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basis is agreed within that period between the Administrative Agent and the Borrower Representative, then it shall apply in accordance with its terms (and may be retrospective to the beginning of the relevant Interest Period) and (y) unless and until a substitute basis is so agreed, the interest payable to such Lenders on the applicable Eurocurrency Rate Loans for the relevant Interest Period will be the rate notified to the Administrative Agent by that Lender to be its cost of funds (from any source which it may reasonably select) plus the Applicable Margin and, if applicable, Mandatory Costs.

(b)

Illegality.  Notwithstanding any other provision herein, if the adoption of or any change in any law, treaty, governmental rules, regulation or guideline or order, or in the interpretation or application thereof shall make it unlawful for any Lender to make or maintain Eurocurrency Rate Loans as contemplated by this Agreement (such Lender an “Affected Lender”), (i) the Commitment of such Lender hereunder to make Eurocurrency Rate Loans, continue Eurocurrency Rate Loans as such and convert Base Rate Loans or Canadian Prime Rate Loans to Eurocurrency Rate Loans shall forthwith be canceled until such time as it shall no longer be unlawful for such Lender to make or maintain the affected Loan and (ii) with respect to any such Lender’s Loans then outstanding as Eurocurrency Rate Loans denominated in Dollars or Canadian Dollars, if any, shall be converted automatically to Base Rate Loans or Canadian Prime Rate Loans, respectively, on the respective last days of the then current Interest Periods with respect to such Loans or within such earlier period as required by law.  If any such conversion of a Eurocurrency Rate Loan occurs on a day which is not the last day of the then current Interest Period with respect thereto, the applicable Borrower shall pay to such Lender such amounts, if any, as may be required pursuant to Section 2.18(c).

(c)

Compensation for Breakage or Non-Commencement of Interest Periods.  The applicable Borrower shall compensate each Lender, upon written request by such Lender (which request shall set forth the basis for requesting such amounts), for all reasonable losses, expenses and liabilities (including any interest paid by such Lender to Lenders of funds borrowed by it to make or carry its Eurocurrency Rate Loans and any loss, expense or liability sustained by such Lender in connection with the liquidation or re-employment of such funds but excluding loss of anticipated profits) which such Lender actually sustains as a direct result of any of the following circumstances: (i) if for any reason (other than a default by such Lender) a borrowing of any Eurocurrency Rate Loan does not occur on a date specified therefor in a Borrowing Notice, or a conversion to or continuation of any Eurocurrency Rate Loan does not occur on a date specified therefor in a Conversion/Continuation Notice; (ii) if any prepayment or other principal payment of, or any conversion of, any of its Eurocurrency Rate Loans occurs on a date prior to the last day of an Interest Period applicable to that Loan; or (iii) if any prepayment of any of its Eurocurrency Rate Loans is not made on any date specified in a notice of prepayment given by the applicable Borrower or the Borrower Representative.

(d)

Booking of Eurocurrency Rate Loans.  Any Lender may make, carry or transfer Eurocurrency Rate Loans at, to or for the account of any of its branch offices or the office of an Affiliate of such Lender.

(e)

Assumptions Concerning Funding of Eurocurrency Rate Loans.  Calculation of all amounts payable to a Lender under this Section 2.18 and under Section 2.19 shall be made as though such Lender had actually funded each of its relevant Eurocurrency Rate



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Loans through the purchase of a Eurocurrency deposit bearing interest at the rate obtained pursuant to clause (i) of the definition of Adjusted Eurocurrency Rate in an amount equal to the amount of such Eurocurrency Rate Loan and having a maturity comparable to the relevant Interest Period and through the transfer of such Eurocurrency deposit from an offshore office of such Lender to the relevant office of such Lender; provided, that each Lender may fund each of its Eurocurrency Rate Loans in any manner it sees fit and the foregoing assumptions shall be utilized only for the purposes of calculating amounts payable under this Section 2.18 and under Section 2.19.

Section 2.19

Increased Costs; Capital Adequacy

.  

(a)

Compensation For Increased Costs.  In the event that any Lender (which term shall include the Issuing Bank for purposes of this Section 2.19(a)) shall determine (which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto) that any law, treaty or governmental rule, regulation or order, or any change therein or in the interpretation, administration or application thereof (including the introduction of any new law, treaty or governmental rule, regulation or order), or any determination of a court or Governmental Authority, in each case that becomes effective after the date hereof, or compliance by such Lender with any guideline, request or directive issued or made after the date hereof by any central bank or other governmental or quasi-governmental authority (whether or not having the force of law): (i) imposes, modifies or holds applicable any reserve (including any marginal, emergency, supplemental, special or other reserve), special deposit, compulsory loan, FDIC insurance or similar requirement against assets held by, or deposits or other liabilities in or for the account of, or advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of such Lender (other than any such reserve or other requirements with respect to Eurocurrency Rate Loans that are reflected in the definition of Adjusted Eurocurrency Rate); or (ii) imposes any other condition on or affecting such Lender (or its applicable lending office) or its obligations hereunder or the London interbank market or the relevant off-shore interbank market for any Approved Currency; and the result of any of the foregoing is to increase the cost to such Lender of agreeing to make, making or maintaining Loans hereunder or acquiring participations in, issuing or maintaining Letters of Credit hereunder or to reduce any amount received or receivable by such Lender (or its applicable lending office) with respect thereto; then, in any such case, the applicable Borrower shall promptly pay to such Lender, upon receipt of the statement referred to in the next sentence, such additional amount or amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Lender in its sole discretion shall determine) as may be necessary to compensate such Lender for any such increased cost or reduction in amounts received or receivable hereunder.  Such Lender shall deliver to the Borrower Representative (with a copy to the Administrative Agent) a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to such Lender under this Section 2.19(a), which statement shall be conclusive and binding upon all parties hereto absent manifest error.  For the avoidance of doubt, this Section 2.19(a) shall not apply to any Taxes, which shall be governed by Section 2.20.  

(b)

Capital Adequacy Adjustment.  In the event that any Lender (which term shall include the Issuing Bank for purposes of this Section 2.19(b)) shall have determined that the adoption, effectiveness, phase-in or applicability after the Closing Date of any law, rule or regulation (or any provision thereof) regarding capital adequacy, or any change therein or in the



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interpretation or administration thereof by any Governmental Authority, central bank or comparable agency charged with the interpretation or administration thereof in each case that becomes effective after the date hereof, or compliance by any Lender (or its applicable lending office) with any guideline, request or directive issued or made after the date hereof regarding capital adequacy (whether or not having the force of law) of any such Governmental Authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on the capital of such Lender or any corporation controlling such Lender as a consequence of, or with reference to, such Lender’s Loans or Revolving Commitment or Letters of Credit, or participations therein or other obligations hereunder with respect to the Loans or the Letters of Credit, to a level below that which such Lender or such controlling corporation could have achieved but for such adoption, effectiveness, phase-in, applicability, change or compliance (taking into consideration the policies of such Lender or such controlling corporation with regard to capital adequacy), then from time to time, within five (5) Business Days after receipt by the Borrower Representative from such Lender of the statement referred to in the next sentence, the applicable Borrower shall pay to such Lender such additional amount or amounts as shall compensate such Lender or such controlling corporation on an after-tax basis for such reduction. Such Lender shall deliver to the Borrower Representative (with a copy to the Administrative Agent) a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to such Lender under this Section 2.19(b), which statement shall be conclusive and binding upon all parties hereto absent manifest error.

Section 2.20

Taxes; Withholding, Etc.

 

(a)

Payments to Be Free and Clear.  All sums payable by or on behalf of any Loan Party hereunder and under any other Loan Document shall (except to the extent required by law) be paid free and clear of, and without any deduction or withholding for or on account of, any Indemnified Tax or Other Tax imposed, levied, collected, withheld or assessed by any Governmental Authority.

(b)

Withholding of Taxes.  If any Loan Party or any other Person is required by law to make any deduction or withholding for or on account of any Indemnified Tax from any sum paid or payable by or on behalf of any Loan Party to the Administrative Agent or any Lender (which term shall include the Issuing Bank for purposes of this Section 2.20(b)) under any of the Loan Documents: (i) the applicable Loan Party shall notify the Administrative Agent in writing of any such requirement or any change in any such requirement as soon as the applicable Loan Party becomes aware of it; (ii) the applicable Borrower shall pay any such Indemnified Tax before the date on which penalties attach thereto, such payment to be made (if the liability to pay is imposed on any Loan Party) for its own account or (if that liability is imposed on the Administrative Agent or such Lender) on behalf of and in the name of the Administrative Agent or such Lender, as the case may be; (iii) the sum payable by such Loan Party in respect of which the relevant deduction, withholding or payment is required shall be increased to the extent necessary to ensure that, after the making of that deduction, withholding or payment, the Administrative Agent or such Lender, as the case may be, receives on the due date a net sum equal to what it would have received had no such deduction, withholding or payment been required or made (after taking into account any additional deduction, withholding or payment of any Indemnified Taxes on such increased payment); and (iv) within thirty (30) days after the due date of payment of any Indemnified Tax which it is required by clause (ii)



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above to pay, the applicable Loan Party shall deliver to the Administrative Agent evidence satisfactory to the Administrative Agent and other affected parties of such deduction, withholding or payment and of the remittance thereof to the relevant taxing or other authority.

(c)

Evidence of Exemption From Withholding Tax.  Any Lender (which term shall include the Issuing Bank for purposes of this Section 2.20(c)) that is entitled to an exemption from or reduction of withholding Tax under the law of the jurisdiction in which any Borrower is resident for tax purposes, or any treaty to which such jurisdiction is a party, with respect to payments hereunder or under any other Loan Document shall, to the extent it may lawfully do so, deliver to such Borrower and the Administrative Agent, at the time or times prescribed by applicable requirements of law and reasonably requested by such Borrower or the Administrative Agent, such properly completed and executed documentation prescribed by applicable requirements of law and any other information (including whether such Lender has complied with the FATCA) as will permit such payments to be made without withholding or at a reduced rate of withholding.  Without limiting the generality of the foregoing, each Lender that is not a United States person (as such term is defined in Section 7701(a)(30) of the Internal Revenue Code) for U.S. federal income tax purposes and that is a Lender to a U.S. Loan (a “Non-U.S. Lender”) (for this purpose, including any Commitment with respect thereto) shall, to the extent it is legally entitled to do so, deliver to the Administrative Agent for transmission to the Borrower Representative, on or prior to the Closing Date (in the case of each Lender listed on the signature pages hereof on the Closing Date) or on or prior to the date of the Assignment Agreement pursuant to which it becomes a Lender (in the case of each other Lender), and at such other times as may be prescribed by law or as may be necessary in the determination of the Borrower Representative or the Administrative Agent (each in the reasonable exercise of its discretion), (i) two (2) original copies of Internal Revenue Service Form W-8BEN (claiming the benefits of any applicable income tax treaty), W-8ECI, W-8EXP and/or W-8IMY (or, in each case, any successor forms), properly completed and duly executed by such Lender, and such other documentation required under the Internal Revenue Code or reasonably requested by the Borrower Representative or the Administrative Agent to establish that such Lender is not subject to (or is subject to a reduced rate of) deduction or withholding of United States federal income tax with respect to any payments to such Lender of principal, interest, fees or other amounts payable under any of the Loan Documents or (ii) if such Lender is not a “bank” or other Person described in Section 881(c)(3) of the Internal Revenue Code and is relying on the so-called “portfolio interest exemption,” a Certificate re Non-Bank Status together with two (2) original copies of Internal Revenue Service Form W-8BEN (or any successor form), properly completed and duly executed by such Lender, and such other documentation required under the Internal Revenue Code or reasonably requested by the Borrower Representative or the Administrative Agent to establish that such Lender is not subject to deduction or withholding of United States federal income tax with respect to any payments to such Lender of interest payable under any of the Loan Documents.  Each Lender that is a United States person (as such term is defined in Section 7701(a)(30) of the Internal Revenue Code) for United States federal income tax purposes (a “U.S. Lender”) shall deliver to the Administrative Agent and the Borrower Representative on or prior to the Closing Date (or, if later, on or prior to the date on which such Lender becomes a party to this Agreement) two (2) original copies of Internal Revenue Service Form W-9 (or any successor form), properly completed and duly executed by such Lender, certifying that such U.S. Lender is entitled to an exemption from United States backup withholding tax, or otherwise prove that it is entitled to such an exemption. Each Lender required to deliver any forms,



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certificates or other evidence with respect to United States federal income tax withholding matters pursuant to this Section 2.20(c) hereby agrees, from time to time after the initial delivery by such Lender of such forms, certificates or other evidence, whenever a lapse in time or change in circumstances renders such forms, certificates or other evidence obsolete or inaccurate in any material respect, that such Lender shall promptly deliver to the Administrative Agent and the Borrower Representative two (2) new original copies of Internal Revenue Service Form W-8BEN, W-8ECI, W-8IMY, W-8EXP and/or W-9 (or, in each case, any successor form), or a Certificate re Non-Bank Status, as the case may be, properly completed and duly executed by such Lender, and such other documentation required under the Internal Revenue Code and reasonably requested by the Borrower Representative or the Administrative Agent to confirm or establish that such Lender is not subject to (or is subject to a reduced rate of) deduction or withholding of United States federal income tax with respect to payments to such Lender under the Loan Documents, or notify the Administrative Agent and the Borrower Representative of its inability to deliver any such forms, certificates or other evidence.  No Borrower shall be required to pay any additional amount to any Non-U.S. Lender under Section 2.20(b)(iii) with respect to Indemnified Taxes imposed by reason of such Lender’s failure (1) to deliver the forms, certificates or other evidence required by this Section 2.20(c) or (2) to notify the Administrative Agent and the Borrower Representative of its inability to deliver any such forms, certificates or other evidence, as the case may be; provided, that if such Lender shall have satisfied the requirements to deliver forms, certificates or other evidence under this Section 2.20(c) on the Closing Date or on the date of the Assignment Agreement pursuant to which it became a Lender, as applicable, nothing in this last sentence of Section 2.20(c) shall relieve any Loan Party of its obligation to pay any additional amounts pursuant to this Section 2.20 in the event that, as a result of any change in any applicable law, treaty or governmental rule, regulation or order, or any change in the interpretation, administration or application thereof that becomes effective after such date, such Lender is no longer properly entitled to deliver forms, certificates or other evidence at a subsequent date establishing the fact that such Lender is not subject to withholding as described herein.

(d)

Without limiting the provisions of Section 2.20(b), each Loan Party shall timely pay all Other Taxes to the relevant Governmental Authorities in accordance with applicable law.  Each Loan Party or the Borrower Representative shall deliver to the Administrative Agent official receipts or other evidence of such payment reasonably satisfactory to the Administrative Agent in respect of any Other Taxes payable hereunder promptly after payment of such Other Taxes.

(e)

If the Administrative Agent or a Lender (which term shall include the Issuing Bank for purposes of this Section 2.20(e)) receives a refund of any amount as to which a Borrower has made any payments pursuant to this Section 2.20, the Administrative Agent or such Lender shall pay over any such refund to such Borrower, net of such Lender’s expenses and out-of-pocket costs; provided that such Borrower, upon the request of the Administrative Agent or such Lender, agrees to repay the amount paid over to the Borrower (including any applicable interest, fees and penalties) in the event that the Administrative Agent or such Lender is required to repay such refund to the relevant Governmental Authority.

(f)

The Loan Parties shall jointly and severally indemnify the Administrative Agent and any Lender (which term shall include Issuing Bank for purposes of this Section



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2.20(f)) for the full amount of Indemnified Taxes for which additional amounts are required to be paid pursuant to Section 2.20(b) and Other Taxes, in each case arising in connection with this Agreement or any other Loan Document (including any such Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section 2.20) paid by the Administrative Agent or Lender or any of their respective Affiliates 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 such Loan Party shall be conclusive absent manifest error.  Such payment shall be due within thirty (30) days of such Loan Party’s receipt of such certificate.

Section 2.21

Obligation to Mitigate

.  Each Lender (which term shall include the Issuing Bank for purposes of this Section 2.21) agrees that, as promptly as practicable after the officer of such Lender responsible for administering its Loans or Letters of Credit, as the case may be, becomes aware of the occurrence of an event or the existence of a condition that would cause such Lender to become an Affected Lender or that would entitle such Lender to receive payments under Section 2.18, 2.19 or 2.20, it shall, to the extent not inconsistent with the internal policies of such Lender and any applicable legal or regulatory restrictions, use reasonable efforts to (a) make, issue, fund or maintain its Credit Extensions through another office of such Lender or (b) take such other measures as such Lender may deem reasonable, if as a result thereof the circumstances which would cause such Lender to be an Affected Lender would cease to exist or the additional amounts which would otherwise be required to be paid to such Lender pursuant to Section 2.18, 2.19 or 2.20 would be materially reduced and if, as determined by such Lender in its sole discretion, the making, issuing, funding or maintaining of such Revolving Commitments, Loans or Letters of Credit through such other office or in accordance with such other measures, as the case may be, would not otherwise adversely affect the interests of such Lender in any material respect; provided, that such Lender shall not be obligated to utilize such other office pursuant to this Section 2.21 unless the Borrower Representative agrees to pay all incremental expenses incurred by such Lender as a result of utilizing such other office as described above.  A certificate as to the amount of any such expenses payable by the Borrower Representative pursuant to this Section 2.21 (setting forth in reasonable detail the basis for requesting such amount) submitted by such Lender to the Borrower Representative (with a copy to the Administrative Agent) shall be conclusive absent manifest error.  For the avoidance of doubt, nothing in this Section 2.21 shall relieve any Lender from its obligations pursuant to Section 2.20(c) of this Agreement.

Section 2.22

Defaulting Lenders

.  Notwithstanding anything to the contrary contained in this Agreement, if any obligations of any Lender to purchase participations in or otherwise refinance or support any Swing Line Loans or Letters of Credit exist at the time any Lender having a Revolving Commitment becomes a Defaulting Lender (such Lender, a “Defaulting Revolving Lender”) then:  

(a)

all obligations of the applicable Defaulting Revolving Lender to purchase participations in or otherwise refinance or support such Swing Line Loans and Letters of Credit shall be reallocated among the non-Defaulting Revolving Lenders of the applicable Class in accordance with their respective Pro Rata Share thereof, but only to the extent (i) (x) with respect to U.S. Swing Line Loans and U.S. Letters of Credit, the sum of the non-Defaulting Revolving



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Lenders’ Pro Rata Shares of the Total Utilization of U.S. Revolving Commitments plus such Defaulting Revolving Lender’s Pro Rata Share of U.S. Revolving Exposure do not exceed the total of all non-Defaulting Revolving Lenders’ U.S. Revolving Commitments, (y) with respect to Canadian Swing Line Loans and Canadian Letters of Credit, the sum of the non-Defaulting Revolving Lenders’ Pro Rata Shares of the Total Utilization of Canadian Revolving Commitments plus such Defaulting Revolving Lender’s Pro Rata Share of Canadian Revolving Exposure do not exceed the total of all non-Defaulting Revolving Lenders’ Canadian Revolving Commitments and (z) with respect to Foreign Letters of Credit, the sum of the non-Defaulting Revolving Lenders’ Pro Rata Shares of the Total Utilization of Foreign Revolving Commitments plus such Defaulting Revolving Lender’s Pro Rata Share of Foreign Revolving Exposure do not exceed the total of all non-Defaulting Revolving Lenders’ Foreign Revolving Commitments and (ii) in each case, the conditions set forth in Section 3.02 are satisfied at such time;

(b)

if the reallocation described in clause (a) above cannot, or can only partially, be effected, the applicable Borrower shall (i) first, within one Business Day following notice by the Administrative Agent, prepay any outstanding Swing Line Loans to the extent the obligations of the applicable Defaulting Revolving Lender to purchase participations in or otherwise refinance or support Swing Line Loans have not been reallocated pursuant to clause (a) above and (ii) second, within three Business Days following notice by the Administrative Agent, Cash Collateralize such Defaulting Revolving Lender’s Pro Rata Share of the obligations to purchase participations in or otherwise refinance or support Letters of Credit (after giving effect to any partial reallocation pursuant to clause (a) above) for so long as such obligations are outstanding; and

(c)

if the obligations of the applicable Defaulting Revolving Lender to purchase participations in or otherwise refinance or support Letters of Credit are reallocated among the non-Defaulting Revolving Lenders pursuant to clause (a) above, then the fees payable to the Lenders pursuant to Section 2.11 shall be adjusted in accordance with such non-Defaulting Revolving Lenders’ Pro Rata Shares.

Section 2.23

Removal or Replacement of a Lender

.  Anything contained herein to the contrary notwithstanding, in the event that: (a) (i) any Lender (an “Increased-Cost Lender”) shall give notice to the Borrower Representative that such Lender is an Affected Lender or that such Lender is entitled to receive payments under Section 2.18, 2.19 or 2.20, (ii) the circumstances which have caused such Lender to be an Affected Lender or which entitle such Lender to receive such payments remain in effect, and (iii) such Lender shall fail to withdraw such notice within five (5) Business Days after the Borrower Representative’s request for such withdrawal; or (b) (i) any Lender shall become a Defaulting Lender, (ii) such Defaulting Lender’s default remains in effect and (iii) such Defaulting Lender shall fail to cure the default as a result of which it has become a Defaulting Lender within five (5) Business Days thereafter; or (c) in connection with any proposed amendment, modification, termination, waiver or consent with respect to any of the provisions hereof as contemplated by Section 10.05(b), the consent of Required Lenders shall have been obtained but the consent of one or more of such other Lenders (each, a “Non-Consenting Lender”) whose consent is required shall not have been obtained; then, with respect to each such Increased-Cost Lender, Defaulting Lender or Non-Consenting Lender (the “Terminated Lender”), the Borrower Representative may, by giving written notice to the Administrative Agent and any Terminated Lender of its election to do so, elect to cause such



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Terminated Lender (and such Terminated Lender hereby irrevocably agrees) to assign its outstanding Loans and its Revolving Commitments, if any, in full to one or more Eligible Assignees (each, a “Replacement Lender”) in accordance with the provisions of Section 10.06 and the applicable Borrower shall pay the fees, if any, payable thereunder in connection with any such assignment from an Increased-Cost Lender, a Non-Consenting Lender or a Defaulting Lender; provided, that (1) on the date of such assignment, the Replacement Lender shall pay to the Terminated Lender an amount equal to the sum of (A) an amount equal to the principal of, and all accrued interest on, all outstanding Loans of the Terminated Lender, (B) an amount equal to all unreimbursed drawings on Letters of Credit that have been funded by such Terminated Lender, together with all then unpaid interest with respect thereto at such time and (C) an amount equal to all accrued but theretofore unpaid fees owing to such Terminated Lender pursuant to Section 2.11, such amounts to be calculated based on the Dollar Equivalent thereof with respect to the U.S. Term Loans, U.S. Revolving Commitments or Canadian Revolving Commitments and based on the Euro Equivalent thereof with respect to the Foreign Term Loans or Foreign Revolving Commitments; (2) on the date of such assignment, the applicable Borrower shall pay any amounts payable to such Terminated Lender pursuant to Section 2.18(c), 2.19 or 2.20; or otherwise as if it were a prepayment and (3) in the event such Terminated Lender is a Non-Consenting Lender, each Replacement Lender shall consent, at the time of such assignment, to each matter in respect of which such Terminated Lender was a Non-Consenting Lender; provided, that the applicable Borrower may not make such election with respect to any Terminated Lender that is also the Issuing Bank unless, prior to the effectiveness of such election, the applicable Borrower shall have caused each outstanding Letter of Credit issued thereby to be cancelled, replaced or Cash Collateralized. Upon the prepayment of all amounts owing to any Terminated Lender and the termination of such Terminated Lender’s Revolving Commitments, if any, such Terminated Lender shall no longer constitute a “Lender” for purposes hereof; provided, that any rights of such Terminated Lender to indemnification hereunder shall survive as to such Terminated Lender.  Each Lender agrees that if a Borrower exercises its option hereunder to cause an assignment by such Lender as a Terminated Lender, such Lender shall, promptly after receipt of written notice of such election, execute and deliver all documentation necessary to effectuate such assignment in accordance with Section 10.06.  In the event that a Lender does not comply with the requirements of the immediately preceding sentence within one Business Day after receipt of such notice, each Lender hereby authorizes and directs the Administrative Agent to execute and deliver such documentation as may be required to give effect to an assignment in accordance with Section 10.06 on behalf of a Terminated Lender and any such documentation so executed by the Administrative Agent shall be effective for purposes of documenting an assignment pursuant to Section 10.06.

Section 2.24

Incremental Facilities

.  The Borrower Representative may by written notice to the Administrative Agent at any time more than 90 days after the Closing Date elect to request (A) prior to the Revolving Commitment Termination Date, an increase to the existing Revolving Commitments (any such increase, the “Incremental Revolving Commitments”) and/or (B) the establishment of one or more new term loan commitments (the “Incremental Term Loan Commitments”), by an amount not in excess of $250,000,000 in the aggregate and not less than $25,000,000 individually (or such lesser amount which shall be approved by the Administrative Agent or such lesser amount that shall constitute the difference between $250,000,000 and all such Incremental Revolving Commitments and Incremental Term Loan Commitments obtained prior to such date), and integral multiples of $10,000,000 in excess



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of that amount.  Each such notice shall specify (A) the date (each, an “Increased Amount Date”) on which the Borrower Representative proposes that the Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable, shall be effective, which shall be a date not less than 10 Business Days after the date on which such notice is delivered to the Administrative Agent and (B) the identity of each Lender or other Person that is an Eligible Assignee (each, an “Incremental Revolving Loan Lender” or “Incremental Term Loan Lender”, as applicable) to whom the Borrower Representative proposes any portion of such Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable, be allocated and the amounts of such allocations; provided that the Administrative Agent may elect or decline to arrange such Incremental Revolving Commitments or Incremental Term Loan Commitments in its sole discretion and any Lender approached to provide all or a portion of the Incremental Revolving Commitments or Incremental Term Loan Commitments may elect or decline, in its sole discretion, to provide an Incremental Revolving Commitment or an Incremental Term Loan Commitment.  Such Incremental Revolving Commitments or Incremental Term Loan Commitments shall become effective as of such Increased Amount Date; provided that (1) no Default or Event of Default shall exist on such Increased Amount Date before or after giving effect to such Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable; (2) both before and after giving effect to the making of any Series of Incremental Term Loans, each of the conditions set forth in Section 3.02 shall be satisfied; (3) the U.S. Borrower shall be in pro forma compliance with each of the covenants set forth in Section 6.07 as of the last day of the most recently ended Fiscal Quarter after giving effect to such Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable; (4) the Incremental Revolving Commitments or Incremental Term Loan Commitments, as applicable, shall be effected pursuant to one or more Joinder Agreements executed and delivered by the applicable Borrower, the Incremental Revolving Loan Lender or Incremental Term Loan Lender, as applicable, and the Administrative Agent, and each of which shall be recorded in the Register and each Incremental Revolving Loan Lender and Incremental Term Loan Lender shall be subject to the requirements set forth in Section 2.20(c); (5) the applicable Borrower shall make any payments required pursuant to Section 2.18(c) in connection with the Incremental Revolving Commitments; (6) the applicable Borrower shall deliver or cause to be delivered any legal opinions or other documents (including modifications of Mortgages and title insurance endorsements or policies) as reasonably requested by the Administrative Agent in connection with any such transaction and (7) the applicable Borrower shall have paid all fees and expenses owing to the Agents and the Lenders in respect of such Incremental Revolving Commitments or Incremental Term Loan Commitments.  Any Incremental Term Loans made on an Increased Amount Date shall be designated a separate series (a “Series”) of Incremental Term Loans for all purposes of this Agreement.

On any Increased Amount Date on which Incremental Revolving Commitments are effected, subject to the satisfaction of the foregoing terms and conditions, (a) each of the Lenders with Revolving Commitments of the same Class shall assign to each of the Incremental Revolving Loan Lenders, and each of the Incremental Revolving Loan Lenders shall purchase from each of such Lenders, at the principal amount thereof (together with accrued interest), such interests in the applicable Revolving Loans outstanding on such Increased Amount Date as shall be necessary in order that, after giving effect to all such assignments and purchases, such Revolving Loans will be held by existing Lenders with Revolving Commitments of the same Class and Incremental Revolving Loan Lenders ratably in accordance with their Revolving



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Commitments after giving effect to the addition of such Incremental Revolving Commitments to the Revolving Commitments of the applicable Class, (b) each Incremental Revolving Commitment shall be deemed for all purposes a Revolving Commitment of the applicable Class and each Loan made thereunder (an “Incremental Revolving Loan”) shall be deemed, for all purposes, a Revolving Loan of the applicable Class and (c) each Incremental Revolving Loan Lender shall become a Lender with respect to the Incremental Revolving Commitment and all matters relating thereto.

On any Increased Amount Date on which any Incremental Term Loan Commitments of any Series are effective, subject to the satisfaction of the foregoing terms and conditions, (i) each Incremental Term Loan Lender of any Series shall make a Loan to the Borrowers (an “Incremental Term Loan”) in an amount equal to its Incremental Term Loan Commitment of such Series and (ii) each Incremental Term Loan Lender of any Series shall become a Lender hereunder with respect to the Incremental Term Loan Commitment of such Series and the Incremental Term Loans of such Series made pursuant thereto.

The Administrative Agent shall notify the Lenders promptly upon receipt of the Borrower Representative’s notice of each Increased Amount Date and in respect thereof (y) the Incremental Revolving Commitments and the Incremental Revolving Loan Lenders or the Series of Incremental Term Loan Commitments and the Incremental Term Loan Lenders of such Series, as applicable and (z) in the case of each notice to any applicable Lender with Revolving Commitments, the respective interests in such Lender’s Revolving Loans, in each case subject to the assignments contemplated by this Section.

The terms and provisions of the Incremental Term Loans and Incremental Term Loan Commitments of any Series shall be, except as otherwise set forth herein or in the Joinder Agreement, identical to the Tranche B Term Loans of the same Class.  The terms and provisions of the Incremental Revolving Loans shall be identical to the Revolving Loans of the same Class.  In the case of any Incremental Term Loans, (i) the Weighted Average Life to Maturity of all Incremental Term Loans of any Series shall be no shorter than the Weighted Average Life to Maturity of the Tranche B Terms Loans, (ii) the applicable Incremental Term Loan Maturity Date of each Series shall be no earlier than the final maturity of the Term Loans, and (iii) the yield and all other terms applicable to the Incremental Term Loans of each Series shall be determined by the Borrower Representative and the applicable new Lenders and shall be set forth in each applicable Joinder Agreement; provided, however, that the yield applicable to the Incremental Term Loans (after giving effect to all rate floors and all fees or original issue discount payable with respect to such Incremental Term Loans), as reasonably determined by the Administrative Agent, shall not be greater than the applicable interest rate (including the Applicable Margin and rate floor) payable pursuant to the terms of this Agreement as amended through the date of such calculation with respect to the Tranche B Term Loans, plus 0.25% per annum unless (i) the interest rate with respect to the Tranche B Term Loans is increased so as to cause the then applicable interest rate under this Agreement on the Tranche B Term Loans to be not more than 0.25% less than the yield then applicable to the Incremental Term Loans (after giving effect to all rate floors and all fees or original issue discount payable with respect to such Incremental Term Loans) and (ii) the interest rate with respect to Tranche A Term Loans is increased by an amount equal to the amount of any increase in the interest rate for Tranche B Term Loans pursuant to clause (i).  Any Incremental Revolving Loans will be documented solely



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as an increase to the Revolving Commitments of the same Class without any change in terms, other than any change that is more favorable to the Revolving Lenders and applies equally to all Revolving Loans and Revolving Commitments of the same Class.  Each Joinder Agreement may, without the consent of any Lender other than the applicable Incremental Revolving Loan Lender or Incremental Term Loan Lender, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the opinion of the Administrative Agent to effect the provisions of this Section 2.24.  

Section 2.25

Appointment of Borrower Representative

.  Each Borrower hereby appoints the Borrower Representative as its agent, attorney-in-fact and representative for the purpose of (i) making any borrowing requests or other requests required under this Agreement, (ii) the giving and receipt of notices by and to Borrowers under this Agreement, (iii) the delivery of all documents, reports, financial statements and written materials required to be delivered by Borrowers under this Agreement, and (iv) all other purposes incidental to any of the foregoing.  Each Borrower agrees that any action taken by the Borrower Representative as the agent, attorney-in-fact and representative of the Borrowers shall be binding upon each Borrower to the same extent as if directly taken by such Borrower.

Section 2.26

Ancillary Facilities.

(a)

Type of Facility.  An Ancillary Facility may be by way of: (i) an overdraft facility; (ii) a guarantee, bonding, documentary or stand-by letter of credit facility; (iii) a term loan facility; (iv) a derivatives facility; (v) a foreign exchange facility; or (vi) any other facility or accommodation reasonably necessary or useful in connection with the business of the Group or any member thereof and which is agreed by the Borrower Representative with an Ancillary Lender.

(b)

Availability.

(i)

If the Foreign Borrower or any other Ancillary Borrower and a Lender agree and except as otherwise provided in this Agreement, such Lender may provide an Ancillary Facility on a bilateral basis in place of all or part of that Lender's unutilized Foreign Revolving Commitment (which, except for the purposes of determining the Required Lenders and for the purpose of Section 2.23, shall be reduced by the amount of the Ancillary Commitment under that Ancillary Facility).  

(ii)

An Ancillary Facility shall not be made available unless, not later than five (5) Business Days prior to the Ancillary Commencement Date for such Ancillary Facility, the Administrative Agent has been notified in writing by the Borrower Representative that such Ancillary Facility has been established and specifying (1) the proposed Ancillary Commencement Date and expiration date of the Ancillary Facility; (2) the proposed type of Ancillary Facility to be provided, (3) the proposed Ancillary Lender and Ancillary Borrower, (4) the proposed Ancillary Commitment, the maximum amount of the Ancillary Facility and, if the Ancillary Facility is an overdraft facility comprising more than one account, its maximum gross amount (that amount being the "Designated Gross Amount") and its maximum net amount (that amount being the



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"Designated Net Amount"); and (5) the proposed currency of the Ancillary Facility (if not denominated in Euros).

(iii)

The Administrative Agent shall promptly notify the Ancillary Lender and the other Lenders of the establishment of an Ancillary Facility.  Subject to compliance with clause (b)(ii) above, (x) the Lender concerned will become an Ancillary Lender and (y) the Ancillary Facility will be available, with effect from the date agreed by the Borrower Representative, the applicable Ancillary Borrower and the Ancillary Lender.

(iv)

No amendment or waiver of a term of any Ancillary Facility shall require the consent of any Lender other than the relevant Ancillary Lender unless such amendment or waiver itself relates to or gives rise to a matter which would require an amendment of or under this Agreement (including, for the avoidance of doubt, under this Section 2.26).  In such a case, the provisions of this Agreement with regard to amendments and waivers will apply.

(c)

Terms of Ancillary Facilities.

(i)

Except as provided below, the terms of any Ancillary Facility will be those agreed by the applicable Ancillary Lender and the applicable Ancillary Borrower; provided that such terms (1) must be based upon normal commercial terms at that time (except as varied by this Agreement); (2) may allow only the applicable Ancillary Borrower to use the Ancillary Facility; (3) may not allow the Ancillary Outstandings to exceed the Ancillary Commitment; (4) may not allow the Ancillary Commitment of a Lender to exceed the Foreign Revolving Commitment of that Lender; and (5) shall require that the Ancillary Commitment shall be reduced to zero, and that all Ancillary Outstandings shall be repaid (or cash collateralized in a manner acceptable to the applicable Ancillary Lender) not later than the Foreign Revolving Commitment Termination Date (or such earlier date as the Foreign Revolving Commitment of the relevant Ancillary Lender is reduced to zero).

(ii)

If there is any inconsistency between any term of an Ancillary Facility and any term of this Agreement, this Agreement shall prevail except for (x) Sections 2.08(d), 2.08(g), and 2.11(d) which shall not prevail for the purposes of calculating fees, interest or commission relating to an Ancillary Facility; (y) an Ancillary Facility comprising more than one account where the terms of the Ancillary Documents shall prevail to the extent required to permit the netting of balances on those accounts; and (z) where the relevant term of this Agreement would be contrary to, or inconsistent with, the law governing the relevant Ancillary Document, in which case that term of this Agreement shall not prevail.

(iii)

Interest, commission and fees on Ancillary Facilities are dealt with in Sections 2.08(h) and 2.11(e).

(d)

Repayment of Ancillary Facility.



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(i)

An Ancillary Facility shall cease to be available on the Foreign Revolving Commitment Termination Date or such earlier date on which its expiration occurs or on which it is cancelled in accordance with the terms of this Agreement or the applicable Ancillary Facility.

(ii)

If an Ancillary Facility expires in accordance with its terms, the Ancillary Commitment of the Ancillary Lender shall be reduced to zero (and such Lender’s Foreign Revolving Commitment shall be increased accordingly).

(iii)

No Ancillary Lender may demand repayment or prepayment of any amounts or demand cash collateralization for any liabilities made available or incurred by it under its Ancillary Facility (except where the Ancillary Facility is provided on a net limit basis to the extent required to bring any gross outstandings down to the net limit) unless (x) the Foreign Revolving Commitments have been cancelled in full, or all outstanding Foreign Revolving Loans have become due and payable in accordance with the terms of this Agreement, or the Administrative Agent has declared all outstanding Foreign Revolving Loans immediately due and payable, or the expiration date of the Ancillary Facility occurs; (y) it becomes unlawful in any applicable jurisdiction for the Ancillary Lender to perform any of its obligations as contemplated by this Agreement or to fund, issue or maintain its participation in its Ancillary Facility; or (z) the Ancillary Outstandings (if any) under that Ancillary Facility can be refinanced by a Foreign Revolving Loan and the Ancillary Lender gives sufficient notice to enable a Foreign Revolving Loan to be made to refinance those Ancillary Outstandings.

(iv)

For the purposes of determining whether or not the Ancillary Outstandings under an Ancillary Facility mentioned in clause (c)(iii)(z) above can be refinanced by a Foreign Revolving Loan, (x) the Foreign Revolving Commitment of the Ancillary Lender will be increased by the amount of its Ancillary Commitment; and (y) the Foreign Revolving Loan may (so long as clause (c)(iii)(x) above does not apply) be made irrespective of whether a Default is outstanding or any other applicable condition precedent is not satisfied (but only to the extent that the proceeds are applied in refinancing those Ancillary Outstandings) and irrespective of whether the applicable Foreign Borrower or the Borrower Representative shall have delivered a Borrowing Notice.

(v)

On the making of a Foreign Revolving Loan to refinance Ancillary Outstandings, (x) each Lender will participate in such Foreign Revolving Loan on a pro rata basis in accordance with its respective Foreign Revolving Commitment (as determined by the Administrative Agent); and (y) the relevant Ancillary Facility shall be cancelled.

(vi)

In relation to an Ancillary Facility which comprises an overdraft facility where a Designated Net Amount has been established, the Ancillary Lender providing that Ancillary Facility shall only be obliged to take into account for the purposes of calculating compliance with the Designated Net Amount those credit balances which it is permitted to take into account by the then current law and regulations



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in relation to its reporting of exposures to applicable regulatory authorities as netted for capital adequacy purposes.

(e)

Ancillary Outstandings.

Each Ancillary Borrower and each Ancillary Lender agrees with and for the benefit of each Lender that (i) the Ancillary Outstandings under any Ancillary Facility provided by that Ancillary Lender shall not exceed the Ancillary Commitment applicable to that Ancillary Facility and where the Ancillary Facility is an overdraft facility comprising more than one account, Ancillary Outstandings under that Ancillary Facility shall not exceed the Designated Net Amount in respect of that Ancillary Facility; and (ii) where all or part of the Ancillary Facility is an overdraft facility comprising more than one account, the Ancillary Outstandings (calculated on the basis that the words in parentheses in paragraph (a) of the definition of that term were deleted) shall not exceed the Designated Gross Amount applicable to that Ancillary Facility.

(f)

Information.

Each Ancillary Borrower and each Ancillary Lender shall, promptly upon request by the Administrative Agent, supply the Administrative Agent with any information relating to the operation of an Ancillary Facility (including the Ancillary Outstandings) as the Administrative Agent may reasonably request from time to time. The Ancillary Borrowers consents to all such information being released to the Administrative Agent and the Lenders.

(g)

Foreign Revolving Facility Commitment Amounts. Notwithstanding any other term of this Agreement, each Lender shall ensure that at all times its Foreign Revolving Commitment (excluding for these purposes any reduction in a Lender’s Foreign Revolving Commitment attributable to the relevant Ancillary Commitment) is not less than its Ancillary Commitment.

(h)

Affiliates of Lenders as Ancillary Lenders.

(i)

Subject to the terms of this Agreement, an Affiliate of a Lender may become an Ancillary Lender.  In such case, the Lender and its Affiliate shall be treated as a single Lender having a Foreign Revolving Commitment of the relevant Lender.

(ii)

To become an Ancillary Lender hereunder, an Affiliate of a Lender must be designated in the notice required in respect of the applicable Ancillary Facility pursuant to Section 2.26(b)(ii) hereof or otherwise in a writing signed by an Authorized Officer of the applicable Ancillary Borrower and delivered to the Administrative Agent, and shall deliver to the Administrative Agent such documentation as the Administrative Agent shall reasonably require.  

(iii)

Each Lender shall ensure that each of its Affiliates that becomes an Ancillary Lender will comply with any obligations imposed upon it pursuant to this Agreement.  Where this Agreement imposes an obligation on an Ancillary Lender and the relevant Ancillary Lender is an Affiliate of a Lender which is not a party to this Agreement, the relevant Lender shall ensure that the obligation is performed by its Affiliate.



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(i)

Closing Date Ancillary Facility.  The parties agree, notwithstanding anything herein to the contrary, that (i) on the Closing Date, the Closing Date Ancillary Facility shall be an Ancillary Facility, the Foreign Borrower shall be an Ancillary Borrower and Fortis Bank (Nederland) N.V. shall be an Ancillary Lender, in each case for all purposes hereunder, and (ii) upon becoming a Guarantor hereunder pursuant to the execution and delivery of a Counterpart Agreement, each of Tommy Hilfiger Group B.V. and Tommy Hilfiger Europe B.V. shall be an Ancillary Borrower for all purposes hereunder.  

ARTICLE III.
CONDITIONS PRECEDENT

Section 3.01

Closing Date

.  The obligation of each Lender to make a Credit Extension on the Closing Date is subject to the satisfaction, or waiver of the following conditions on or before the Closing Date:

(a)

Loan Documents.  The Administrative Agent shall have received each of the Credit Agreement, the U.S. Security Agreements, the Dutch Closing Security Documents, the Intercreditor Agreements, a Mortgage in respect of each Closing Date Mortgaged Property and the Intellectual Property Security Agreements, in each case, executed and delivered by each applicable Loan Party.  

(b)

Organizational Documents; Incumbency.  The Administrative Agent shall have received in relation to each U.S. Loan Party, the Foreign Borrower, Tommy Hilfiger Group B.V. (but solely with respect to clause (1) and (4) below), Trumpet C.V., Prince 1 B.V. and Prince 2 B.V. (1) copies of each Organizational Document and, to the extent applicable, certified as of a recent date by the appropriate governmental official; (2) corporate or entity certificates incorporating, without limitation, signature and incumbency certificates of the officers, managers, members and/or directors of such Person executing the Loan Documents to which it is a party; (3) to the extent applicable, resolutions of the Board of Directors (which, in the case of each Dutch Loan Party other than Trumpet C.V., shall be its board of managing directors) approving and authorizing the execution, delivery and performance of this Agreement and the other Loan Documents to which it is a party or by which it or its assets may be bound as of the Closing Date, certified (to the extent required under applicable law or customary in accordance with local law or practice) as of the Closing Date by its secretary, its assistant secretary, director or any other competent officer or appropriate person as being in full force and effect without modification or amendment; (4) to the extent required under applicable law, the relevant entity’s Organizational Documents or internal regulations or, customary in accordance with local law or practice, a copy of resolutions from the general meeting of shareholders or its partners approving and authorizing the execution, delivery and performance of this Agreement and the other Loan Documents to which it is a party or by which it or its assets may be bound as of the Closing Date, certified as of the Closing Date by its secretary or an assistant secretary as being in full force and effect without modification or amendment and (5) to the extent required under applicable law or customary in accordance with local law or practice, a good standing certificate from the applicable Governmental Authority of its jurisdiction of incorporation, organization or formation, dated a recent date prior to the Closing Date.



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(c)

Organizational and Capital Structure Chart.  The organizational structure and capital structure of the Group, after giving effect to the Acquisition, shall be as set forth on Schedule 3.01(c).

(d)

Capitalization of the Group; Concurrent Transactions.  On or before the Closing Date:

(i)

the Administrative Agent shall have received evidence that the Equity Contribution shall have been made and that the U.S. Borrower shall have received the proceeds of the Equity Contribution (or, with respect to the equity issued to private investors, all conditions precedent to the initial funding of such Equity Contribution shall have been satisfied);

(ii)

the 2020 Note Documents and all other agreements and documents contemplated thereby shall have been entered into and shall be effective and the U.S. Borrower shall have received, or substantially concurrently with the initial borrowings under this Agreement shall receive, gross proceeds of the 2020 Notes on the Closing Date in an aggregate amount of not less than $600,000,000 (or the conditions to the issuance of the 2020 Notes, other than the funding of the initial borrowings under this Agreement or the satisfaction of the conditions set forth in this Section 3.01, shall have been satisfied or substantially concurrently with the initial borrowings under this Agreement shall be satisfied);

(iii)

(x) the aggregate proceeds of the Equity Contribution, together with the proceeds of the 2020 Notes, the initial borrowings under this Agreement and available cash of the U.S. Borrower and the Acquired Business shall be sufficient to consummate the Acquisition, refinance all Existing Credit Facilities Indebtedness, tender for and satisfy and discharge the Existing Notes and to pay the Transaction Costs, (y) the Acquisition shall have been consummated, or shall be consummated substantially concurrently with the initial borrowings under this Agreement, including the issuance of common equity to the Seller as required by the terms of the Acquisition Agreement, in accordance with the terms of the Acquisition Documents and (z) all conditions to the Acquisition set forth in the Acquisition Agreement shall have been satisfied or duly waived; provided, that no material amendment, modification or waiver of any term of the Acquisition Agreement or any condition to the U.S. Borrower’s obligation to consummate the Acquisition thereunder shall be made or granted, as the case may be, without the prior written consent of the Administrative Agent (it being understood that any change in the price (including any price decrease) or structure of the Acquisition and any changes to the waiver of jury trial, jurisdiction or third party beneficiary language affecting the Lenders shall be deemed to be material and shall require the prior written consent of the Administrative Agent);

(e)

Existing Indebtedness.  On the Closing Date, substantially concurrently with the initial borrowings under this Agreement, the Group shall have (1) repaid in full all Existing Credit Facilities Indebtedness, (2) terminated any commitments to lend or make other extensions of credit thereunder (in the cases of clauses (1) and (2), other than the ancillary facilities thereunder as set forth on Schedule 3.01(e) that will become Ancillary Facilities



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hereunder), (3) delivered to the Administrative Agent all documents or instruments necessary to release all Liens securing Existing Credit Facilities Indebtedness or other obligations of the Group thereunder being repaid on the Closing Date, and (4) made arrangements satisfactory to the Administrative Agent with respect to any letters of credit outstanding thereunder.  The Existing Notes shall have substantially all restrictive covenants contained in such Existing Notes removed therefrom and a notice of redemption shall have been irrevocably delivered for such Existing Notes and all funds necessary for such redemption shall have been irrevocably deposited into escrow to fund such redemption.

(f)

Governmental Authorizations and Consents.  Each Loan Party (other than the Foreign Guarantors) shall have obtained all material Governmental Authorizations and all material consents of other Persons, in each case that are necessary in connection with the transactions contemplated by the Loan Documents and the Acquisition Agreement, and each of the foregoing shall be in full force and effect.

(g)

U.S. Real Estate Assets.  In order to create in favor of the Collateral Agent, for the benefit of Secured Parties, a valid and, subject to any filing and/or recording referred to herein, perfected First Priority security interest in certain Real Estate Assets located in the United States, the Collateral Agent shall have received from each applicable Loan Party:

(1)

fully executed and notarized Mortgages, in proper form for recording in all appropriate places in all applicable jurisdictions, encumbering each Real Estate Asset listed in Schedule 3.01(g) (each, a “Closing Date Mortgaged Property”);

(2)

an opinion of counsel (which counsel shall be reasonably satisfactory to the Collateral Agent) in each state in which a Closing Date Mortgaged Property is located with respect to the enforceability of the form(s) of Mortgages to be recorded in such state and such other matters as the Collateral Agent may reasonably request, in each case in form and substance reasonably satisfactory to the Collateral Agent;

(3)

in the case of each Leasehold Property that is a Closing Date Mortgaged Property, (A) a Landlord Consent if the applicable landlord has delivered such Landlord Consent (it being agreed that the U.S. Borrower shall use commercially reasonable efforts to obtain a Landlord Consent; provided that the U.S. Borrower shall not be required to expend any funds or grant any concession to obtain such Landlord Consent), and (B) evidence that such Leasehold Property is a Recorded Leasehold Interest;

(4)

ALTA mortgagee title insurance policies or unconditional commitments therefor issued by one or more title companies (the “Title Company”) reasonably satisfactory to the Collateral Agent with respect to each Closing Date Mortgaged Property (each, a “Title Policy”), in amounts not less than 110% of the fair market value of each Closing Date Mortgaged Property insuring the title to each of the Closing Date Mortgaged Properties vested in the applicable Loan Party and insuring the Collateral Agent that the relevant



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Mortgage creates a valid and enforceable First Priority mortgage Lien on the Closing Date Mortgaged Property encumbered thereby, each of which Title Policy (A) shall include all endorsements reasonably requested by the Collateral Agent and (B) shall provide for affirmative insurance and such reinsurance as the Collateral Agent may reasonably request, all of the foregoing in form and substance reasonably satisfactory to the Collateral Agent; and evidence satisfactory to the Collateral Agent that the applicable Loan Party has (i) delivered to the Title Company all certificates, consents and affidavits required by the Title Company in connection with the issuance of the applicable Title Policy and (ii) paid to the Title Company or to the appropriate Governmental Authorities all expenses and premiums of the Title Company and all other sums required in connection with the issuance of the Title Policies and all recording and stamp taxes (including mortgage recording and intangible taxes) payable in connection with recording the Mortgages in the applicable real property records; together with a title report issued by a title company with respect thereto, dated not more than thirty (30) days prior to the Closing Date (or such earlier date as the Collateral Agent may agree) and copies of all recorded documents listed as exceptions to title or otherwise referred to therein, each in form and substance reasonably satisfactory to the Collateral Agent; and

(5)

(A) a completed Flood Certificate with respect to each Closing Date Mortgaged Property, which Flood Certificate shall (i) be addressed to the Collateral Agent, (ii) be completed by a company which has guaranteed the accuracy of the information contained therein, and (iii) otherwise comply with the Flood Program; (B) evidence describing whether the community in which each Closing Date Mortgaged Property is located participates in the Flood Program; (C) if any Flood Certificate states that a Closing Date Mortgaged Property is located in a Flood Zone, the Borrower Representative’s written acknowledgement of receipt of written notification from the Collateral Agent (i) as to the existence of each such Closing Date Mortgaged Property, and (ii) as to whether the community in which each such Closing Date Mortgaged Property is located is participating in the Flood Program; and (D) if any Closing Date Mortgaged Property is located in a Flood Zone and is located in a community that participates in the Flood Program, evidence that the applicable Loan Party has obtained a policy of flood insurance that is in compliance with all applicable regulations of the Board of Governors.

(h)

U.S. Personal Property Collateral.  In order to create in favor of the Collateral Agent, for the benefit of Secured Parties, a valid, perfected First Priority security interest in the personal property Collateral of each U.S. Loan Party, each U.S. Loan Party shall have delivered to the Collateral Agent:  

(1)

evidence satisfactory to the Collateral Agent of the compliance by each such Loan Party of their obligations under the U.S. Security Agreements (including their obligations to execute and deliver UCC financing statements and originals of securities, instruments and chattel paper as provided therein); provided that in no event shall more than 66% of the Equity Interests in a U.S-



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Owned DRE be pledged by any Loan Party, except that if such U.S.-Owned DRE owns less than 100% of the Equity Interests of a Foreign Subsidiary, appropriate adjustments shall be made such that 66% of the Equity Interests of such Foreign Subsidiary (but no more than 66%) are pledged;

(2)

a completed Perfection Certificate dated the Closing Date and executed by an Authorized Officer of each such Loan Party, together with all attachments contemplated thereby; and

(3)

fully executed and notarized Intellectual Property Security Agreements, in proper form for filing or recording in the United States Copyright Office or the United States Patent and Trademark Office, as applicable, memorializing and recording the encumbrance of the registrations and applications for United States Trademarks, Copyrights and Patents listed in Schedule 4.21 (excluding, for the avoidance of doubt, those Trademarks, Copyrights and Patents, if any, in the name of the CKI Trust).

(i)

Dutch Security.  The Collateral Agent shall have received a fully executed copy of each Dutch Closing Security Document (other than any notarial deed of pledge of shares), fully executed notices and/or other documents required to be delivered in order to ensure the validity and perfection of each Dutch Closing Security Document.

(j)

[Reserved].    

(k)

Financial Statements.  The Administrative Agent shall have received from the U.S. Borrower (1) the Historical Financial Statements of the U.S. Borrower and the Historical Financial Statements of the Acquired Business and (2) pro forma consolidated balance sheets of the Group as filed with the SEC on April 26, 2010.

(l)

Evidence of Insurance.  The Collateral Agent shall have received a certificate from the Borrower’s insurance broker or other evidence satisfactory to it that all insurance required to be maintained pursuant to Section 5.05 is in full force and effect, together with endorsements to the extent required under Section 5.05.

(m)

Opinions of Counsel to Loan Parties.  The Agents and the Lenders and their respective counsel shall have received originally executed copies of the favorable written opinions of Wachtell, Lipton, Rosen & Katz, as New York counsel to the Loan Parties, Prickett, Jones & Elliot, P.A. as Delaware counsel to the Loan Parties, Katten Muchin Rosenman, as California counsel to the Loan Parties, De Brauw Blackstone Westbroek N.V., as Dutch counsel to the Loan Parties, and Loyens & Loeff (USA) B.V., as Dutch counsel to the Administrative Agent, the Lenders and the other Secured Parties, as to such matters as the Administrative Agent may reasonably request, dated as of the Closing Date and otherwise in form and substance reasonably satisfactory to the Administrative Agent (and each Loan Party hereby instructs such counsel to deliver such opinions to the Agents and the Lenders).

(n)

Fees.  The Borrowers shall have paid to the Agents, concurrent with the consummation of the Acquisition on the Closing Date, the fees payable on the Closing Date pursuant to that certain Fee Letter, dated March 15, 2010, between the Arrangers, the



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Bookrunners and the U.S. Borrower, including expenses to the extent invoiced at least one (1) Business Day prior to the Closing Date.

(o)

Solvency Certificate.  The Administrative Agent shall have received a Solvency Certificate from the U.S. Borrower in the form of Exhibit E-2.

(p)

Closing Date Certificate.  The Borrower Representative shall have delivered to the Administrative Agent an executed Closing Date Certificate, together with all attachments thereto, and which shall include certifications to the effect that:

(i)

since (i) January 31, 2010 with respect to the U.S. Borrower and its Subsidiaries (taken as a whole) and (ii) March 31, 2009 with respect to the Acquired Business, no event, circumstance or change has occurred that has caused, either individually or in the aggregate, a Material Adverse Effect;

(ii)

each of the conditions precedent described in this Section 3.01 shall have been satisfied on the Closing Date (except that no opinion need be expressed as to Administrative Agent’s or Required Lenders’ satisfaction with any document, instrument or other matter); and

(iii)

no terms or conditions of the Acquisition Agreement have been amended, waived or terminated without the consent of the Administrative Agent, except to the extent it does not materially affect the interests of the Lenders.

(q)

Ancillary Documents.  The Administrative Agent shall have received true and correct copies of the CKI Documents, the TH Documents, the Acquisition Agreement and the 2020 Notes Documents.

(r)

Credit Rating.  The U.S. Borrower shall have been assigned a public corporate family rating from Moody’s and a public corporate credit rating from S&P and the credit facilities hereunder shall have been assigned a public credit rating from each of Moody’s and S&P.

(s)

No Litigation.  There shall not exist any Adverse Proceeding pending or, to the knowledge of any Authorized Officer of any Borrower, threatened in writing, that, singly or in the aggregate, materially impairs the Acquisition, the financing thereof or any of the other transactions contemplated by the Acquisition Agreement or the Loan Documents.

(t)

Flow of Funds; Letter of Direction.  The Administrative Agent shall have received a funds flow memorandum and duly executed letter of direction from the Borrower Representative addressed to the Administrative Agent, on behalf of itself and Lenders, directing the disbursement on the Closing Date of the proceeds of the Loans made on such date.

(u)

Bank Regulatory Information.  To the extent requested in writing to the U.S. Borrower at least 20 days prior to the Closing Date, the Lenders shall have received at least 5 days prior to the Closing Date all documentation and other information required by bank regulatory authorities under applicable “know-your-customer” and anti-money laundering rules and regulations, including the Uniting and Strengthening America by Providing Appropriate



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Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Pub. L. No. 107-56 the “PATRIOT Act”).

(v)

Base Case Model.  The Lenders shall have received the base case model included in the Confidential Information Memorandum or with such amendments or modifications as do not materially and adversely affect the interests of the Lenders or which have been made with the consent of the Administrative Agent, such consent not to be unreasonably withheld.

(w)

Structure Diagram.  The Lenders shall have received a structure diagram prepared by the U.S. Borrower describing the Group and the Acquisition, in a form reasonably satisfactory to the Administrative Agent.

Section 3.02

Conditions to Each Credit Extension

.  

(a)

Conditions Precedent.  The obligation of each Lender to make any Loan, or each Issuing Bank to issue any Letter of Credit, on any Credit Date, including the Closing Date, are subject to the satisfaction, or waiver in accordance with Section 10.05, of the following conditions precedent:

(i)

the Administrative Agent shall have received a fully executed and delivered Borrowing Notice or Issuance Notice, as the case may be;

(ii)

after making the Credit Extensions requested on such Credit Date, (x) the Total Utilization of U.S. Revolving Commitments shall not exceed the U.S. Revolving Commitments then in effect, (y) the Total Utilization of Foreign Revolving Commitments shall not exceed the Foreign Revolving Commitments then in effect and (z) the Total Utilization of Canadian Revolving Commitments shall not exceed the Canadian Revolving Commitments then in effect;

(iii)

as of such Credit Date, the representations and warranties contained herein and in the other Loan Documents shall be true and correct in all material respects on and as of that Credit Date to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date; provided, that to the extent any such representation or warranty is already qualified by materiality or Material Adverse Effect, such representation or warranty shall be true and correct in all respects;

(iv)

as of such Credit Date, no event shall have occurred and be continuing or would result from the consummation of the applicable Credit Extension that would constitute a Default or an Event of Default; and

(b)

Notices.  Any Notice shall be executed by an Authorized Officer of the Borrower Representative or the applicable Borrower in a writing delivered to the Administrative Agent.  



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ARTICLE IV.
REPRESENTATIONS AND WARRANTIES

In order to induce the Lenders and the Issuing Bank to enter into this Agreement and to make each Credit Extension to be made thereby, each Borrower and each other Loan Party (in the case of each Loan Party, solely with respect to itself) represents and warrants to each Lender and the Issuing Bank, on the Closing Date and on each Credit Date that the following statements are true and correct:  

Section 4.01

Organization; Structure Chart; Requisite Power and Authority; Qualification

.  Each Group Member (a) is duly organized, duly incorporated or formed, validly existing and, if applicable, in good standing under the laws of its jurisdiction of organization, (b) has all requisite power and authority to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby and, except where failure to have such power and authority would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, to own and operate its properties and assets, to carry on its business as now conducted and as proposed to be conducted, and (c) is qualified to do business and, if applicable, in good standing in every jurisdiction where any material portion of its assets are located and wherever necessary to carry out its material business and operations, except where the failure to be so qualified would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 4.02

Equity Interests and Ownership

.  The Equity Interests of each Group Member have been duly authorized and validly issued and are fully paid and non-assessable.  Except as set forth on Schedule 4.02, as of the date hereof, there is no existing option, warrant, call, right, commitment or other agreement to which any Group Member is a party requiring, and there is no membership interest or other Equity Interests of any Group Member outstanding which upon conversion or exchange would require, the issuance by any Group Member of any additional membership interests or other Equity Interests of any Group Member or other Securities convertible into, exchangeable for or evidencing the right to subscribe for or purchase, a membership interest or other Equity Interests of any Group Member.  Schedule 4.02 sets forth the ownership interest of each Group Member in their respective Subsidiaries as of the Closing Date after giving effect to the Acquisition.

Section 4.03

Due Authorization

.  The execution, delivery and performance by each Loan Party of the Loan Documents to which it is a party have been duly authorized by all necessary action on the part of each such Loan Party.

Section 4.04

No Conflict

.  The execution, delivery and performance by each Loan Party of the Loan Documents to which it is a party and the consummation of the transactions contemplated by the Loan Documents do not and will not (a) violate (i) any provision of any law or any governmental rule or regulation applicable to any such Loan Party, (ii) any of the Organizational Documents of any such Loan Party or (iii) any order, judgment or decree of any court or other agency of government binding on such Loan Party, except to the extent any such violation would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; (b) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Contractual Obligation of such Loan Party



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except to the extent such conflict, breach or default would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect; (c) result in or require the creation or imposition of any Lien upon any of the properties or assets of such Loan Party (other than any Permitted Liens); or (d) require any approval or consent of the stockholders, members or partners, except for such approvals or consents which have been obtained and except for any such approvals or consents the failure of which to obtain would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 4.05

Governmental Consents

.  The execution, delivery and performance by each Loan Party of the Loan Documents to which it is a party and the incurrence by the Loan Parties of their Obligations thereunder, the issuance of Letters of Credit and the granting of security with respect to their Obligations thereunder do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any Governmental Authority except for (i) filings and recordings with respect to the Collateral to be made, or otherwise delivered to the Collateral Agent for filing and/or recordation, as of the Closing Date, (ii) the registration with the Dutch tax authorities of any Security Documents providing for the creation of Dutch Security in the form of an undisclosed pledge of receivables or an undisclosed pledge of movable assets, (iii) the registration with the appropriate Dutch registry of any Security Document providing for the creation of Dutch Security in the form of a mortgage over any Real Estate Asset, (iv) such has been obtained or made and are in full force and effect and (v) those the failure of which to obtain or make, would not individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

Section 4.06

Binding Obligation

.  Each Loan Document has been duly executed and delivered by each Loan Party that is a party thereto and, assuming due execution by each of the other parties to such Loan Agreement, is the legally valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its respective terms, except as may be limited by (i) bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally, (ii) equitable principles relating to enforceability or (iii) any general rules of law referred to in any legal opinion provided to any Agent or any Lender (or its respective counsel) with respect to such Loan Document pursuant to the Agreement or any other Loan Document.

Section 4.07

Historical Financial Statements

.  The Historical Financial Statements of the U.S. Borrower were prepared in conformity with GAAP and fairly present, in all material respects, the consolidated financial position, of the U.S. Borrower and its consolidated Subsidiaries as of the dates thereof and their consolidated results of operations and cash flows, for the periods then ended. To the knowledge of any Authorized Officer of the U.S. Borrower, the Historical Financial Statements of the Acquired Business were prepared in conformity with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (or, with respect to December 31, 2008, follow IFRS principles) and have been prepared by management of the Acquired Business in a manner consistent with the principles applied to the nine-month period as of and ending on December 31, 2009, and fairly present in all material respects the consolidated financial position of the Acquired Business as of the dates thereof and its consolidated results of operations and cash flows for the periods then ended (subject in the case of the unaudited financial statements, to the absence of footnotes and to normal year-end adjustments not expected to be material in amount



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and to any other adjustments described therein including the notes thereto). As of the Closing Date, no Group Member has any contingent liability or liability for Taxes, long-term lease or unusual forward or long-term commitment that is not reflected in the Historical Financial Statements of the U.S. Borrower or Historical Financial Statements of the Acquired Business, respectively, or the notes thereto and which in any such case is material in relation to the business, operations, properties, assets, or financial condition of the Group taken as a whole.

Section 4.08

Projections

.  On and as of the Closing Date, the projections of the Group for each Fiscal Quarter of Fiscal Year 2010 and each Fiscal Year thereafter through and including Fiscal Year 2016 (the “Projections”) are based on good faith estimates by the management of the U.S. Borrower and the assumptions set forth therein; provided, that the Projections are not to be viewed as facts and that actual results during the period or periods covered by the Projections may differ from such Projections and that the differences may be material.  

Section 4.09

No Material Adverse Change

.  Since (i) January 31, 2010 with respect to the U.S. Borrower and any Subsidiary of the U.S. Borrower prior to giving effect to the Acquisition and (ii) March 31, 2009 with respect to the Acquired Business, no event, circumstance or change has occurred that has caused, either individually or in the aggregate, a Material Adverse Effect.

Section 4.10

Adverse Proceedings, Etc.

  There are no Adverse Proceedings pending or, to the knowledge of any Authorized Officer of any Borrower, threatened in writing, individually or in the aggregate, that would reasonably be expected to have a Material Adverse Effect.  No Group Member (a) is in violation of any applicable laws (but excluding any Environmental Laws, which are subject to Section 4.13) that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect or (b) is in default with respect to any final judgments, writs, injunctions, decrees, rules or regulations of any court or any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.

Section 4.11

Payment of Taxes

.  All material Tax returns and reports of the Group required to be filed by any of them have been accurately and timely filed, and all material Taxes due and payable and all assessments, fees, Taxes and other governmental charges upon any Group Members and their respective properties, assets, income, businesses and franchises which are due and payable have been paid when due and payable, except Taxes that are being contested in good faith by appropriate proceedings and for which reserves or other appropriate provisions, if any, have been made in accordance with GAAP.

Section 4.12

Properties

.  

(a)

Title.  Each Group Member has (i) good, sufficient and legal title to (in the case of fee interests in real property), (ii) valid leasehold interests in (in the case of leasehold interests in real or personal property), (iii) valid licensed rights in (in the case of licensed interests in Material Intellectual Property) and (iv) good title to (in the case of all other personal property), all of their respective properties and assets reflected in the Historical Financial



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Statements of the U.S. Borrower or, to the knowledge of any Authorized Officer of any Borrower, the Historical Financial Statements of the Acquired Business, as applicable, referred to in Section 4.07 and in the most recent financial statements delivered pursuant to Section 5.01, in each case except for (A) assets disposed of since the date of such financial statements in the ordinary course of business or as otherwise permitted under Section 6.08, (B) minor defects in title that do not materially interfere with its ability to conduct its business as currently conducted or to utilized such properties for their intended purposes or (C) where the failure to have such title, interest or rights would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  Except as permitted by this Agreement, all such properties and assets are free and clear of Liens other than Permitted Liens.

(b)

Real Estate.  As of the Closing Date, Schedule 4.12 contains a true and complete list of all material Real Estate Assets (other than retail store locations) and a description of each material lease or sublease affecting each Closing Date Mortgaged Property of any Loan Party, of which such Loan Party is the landlord.  

(c)

Flood Zone Properties.  No Mortgage on a Closing Date Mortgaged Property encumbers improved real property that is located in a Flood Zone (except any such property as to which flood insurance has been obtained and is in full force and effect as required by this Agreement).

Section 4.13

Environmental Matters

.  Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect: (a) each Group Member is in compliance with all applicable Environmental Laws; (b) each Group Member has obtained and maintained in full force and effect all Governmental Authorizations required pursuant to Environmental Laws for the operation of their respective business; (c) there are no conditions, occurrences, violations of Environmental Law, or presence or Releases of Hazardous Materials which would reasonably be expected to form the basis of an Environmental Claim against any Group Member or related to any Real Estate Assets; (d) there are no pending Environmental Claims against any Group Member, and no Group Member has received any written notification of any alleged violation of, or liability pursuant to, Environmental Law or responsibility for the Release or threatened Release of, or exposure to, any Hazardous Materials; and (e) no Lien (other than a Permitted Lien) imposed pursuant to any Environmental Law has attached to any Collateral and, to the knowledge of any Authorized Officer of any Borrower, no conditions exist that would reasonably be expected to result in the imposition of such a Lien on any Collateral.

Section 4.14

No Defaults

.  No Group Member is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any of its Contractual Obligations, except where the consequences, direct or indirect, of such default or defaults, if any, would not reasonably be expected to have a Material Adverse Effect.  No Default or Event of Default has occurred and is continuing or would reasonably be expected to occur as a result of any Credit Extension or performance of any transaction under the Loan Documents.

Section 4.15

Governmental Regulation

.  No Group Member is subject to regulation under the Investment Company Act of 1940. No Group Member is a “registered



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investment company” or a company “controlled” by a “registered investment company” or a “principal underwriter” of a “registered investment company” as such terms are defined in the Investment Company Act of 1940.

Section 4.16

Margin Stock

.  No Group Member is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock.  No part of the proceeds of the Loans will be used to purchase or carry any Margin Stock or to extend credit to others for the purpose of purchasing or carrying any Margin Stock or for any purpose that violates, or is inconsistent with, the provisions of Regulation T, U or X of the Board of Governors.  

Section 4.17

Employee Benefit Plans

.  Each Group Member and each of their respective ERISA Affiliates are in compliance with all applicable provisions and requirements of ERISA and the Internal Revenue Code and the regulations and published interpretations thereunder with respect to each Employee Benefit Plan, and have performed all their obligations under each Employee Benefit Plan, other than as would not reasonably be expected to have a Material Adverse Effect.  Each Employee Benefit Plan which is intended to qualify under Section 401(a) of the Internal Revenue Code has received a favorable determination letter from the Internal Revenue Service indicating that such Employee Benefit Plan is so qualified and nothing has occurred subsequent to the issuance of such determination letter which would cause such Employee Benefit Plan to lose its qualified status, in each case, other than as would not reasonably be expected to have a Material Adverse Effect. No material liability to the PBGC (other than required premium payments), the Internal Revenue Service, any Employee Benefit Plan (other than in the ordinary course) or any trust established under Title IV of ERISA has been or is expected to be incurred by any Group Member or any of their respective ERISA Affiliates with respect to any Employee Benefit Plan.  No ERISA Event or Foreign Plan Event has occurred or is reasonably expected to occur where such ERISA Event or Foreign Plan Event would reasonably be expected to have a Material Adverse Effect.  The present value of the aggregate benefit liabilities under each Pension Plan sponsored, maintained or contributed to by any Group Member or any of their respective ERISA Affiliates (determined as of the end of the most recent plan year on the basis of the actuarial assumptions specified for funding purposes in the most recent actuarial valuation for such Pension Plan) did not exceed the aggregate current fair market value of the assets of such Pension Plan, where such circumstance would reasonably be expected to have a Material Adverse Effect. As of the most recent valuation date for each Multiemployer Plan, the potential liability of the Group and its ERISA Affiliates for a complete withdrawal from such Multiemployer Plan (within the meaning of Section 4203 or Section 4205 of ERISA), when aggregated with such potential liability for a complete withdrawal from all Multiemployer Plans, does not exceed $25,000,000.  Each Group Member and each of their ERISA Affiliates have materially complied with the requirements of Section 515 of ERISA with respect to each Multiemployer Plan and are not in material “default” (as defined in Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan.  To the extent applicable, each Foreign Plan has been maintained in substantial compliance with its terms and with the requirements of any and all applicable all laws, rules, regulations and orders of any Governmental Authority and has been maintained, where required, in good standing with applicable regulatory authorities, other than as would reasonably be expected to have a Material Adverse Effect. Each Foreign Plan which is required under all applicable laws, rules, regulations and orders of any Governmental Authority to be funded satisfies in all material respects any



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applicable funding standard under all applicable laws, rules, regulations and orders of any Governmental Authority. For each Foreign Plan which is not funded or which is not required to be fully funded under all applicable laws, rules regulations and orders of any Governmental Authority, the unfunded obligations of such Foreign Plan are properly accrued in all material respects.  Neither any Loan Party nor any of its Subsidiaries is or has at any time been the employer, or connected or associated with the employer (as those terms are used in the UK Pensions Act 2004) in relation to a UK defined benefit pension plan.

Section 4.18

Solvency

.  The Group Members are and, upon the incurrence of any Obligation on any date on which this representation and warranty is made, shall be, on a consolidated basis, Solvent.  

Section 4.19

Compliance with Statutes, Etc.

  Each Group Member is in compliance with all applicable statutes, regulations and orders of, and all applicable restrictions imposed by, all Governmental Authorities, in respect of the conduct of its business and the ownership of its assets and property (but excluding any Environmental Laws, which are subject to Section 4.13), except such non-compliance that, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.  To the extent applicable, each Loan Party is in compliance, in all material respects, with (i) the Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto.  No part of the proceeds of the Loans shall be used, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

Section 4.20

Disclosure

.  No representation or warranty of any Loan Party contained in any Loan Document or in any other documents, certificates or written statements furnished to any Agent or Lender by any Group Member (or by its agents on its behalf) for use in connection with the transactions contemplated hereby contains any untrue statement of a material fact or omits to state a material fact (known to it, or to the Borrower Representative in the case of any document not furnished by it) necessary in order to make the statements contained herein or therein (when furnished and taken as a whole) not materially misleading in light of the circumstances in which the same were made.  Any projections and pro forma financial information contained in such materials are based upon good faith estimates and assumptions believed by the U.S. Borrower to be reasonable at the time made, it being recognized by Lenders that such projections as to future events are not to be viewed as facts and that actual results during the period or periods covered by any such projections may differ from the projected results and such differences may be material.

Section 4.21

Intellectual Property

.  

(a)

Except where the failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect or except where the failure to do so is a result of a transaction or transactions permitted by this Agreement, each of the Loan Parties (i) is the sole and exclusive owner of the entire right, title, and interest in and to all of the



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Intellectual Property listed on Schedule 4.21 (as such schedule may be amended or supplemented from time to time pursuant to a Counterpart Agreement or pursuant to Section 5.01(k)(ii), 5.14 or otherwise), and possesses all rights to sue at law or in equity for any infringement, misappropriation or other impairment thereof, including the right to receive all royalties, license fees, proceeds and damages therefrom, free and clear of all Liens, claims and licenses, except for Permitted Liens and (ii) owns or, pursuant to written agreement, has the valid right to use and, where such Loan Party does so, sublicense others to use, all other Intellectual Property used in or necessary to conduct its business (including granting of outbound licenses of such rights).  All Material Intellectual Property of each Loan Party is subsisting and has not been adjudged invalid or unenforceable, in whole or in part, nor, in the case of Patents, is any of the Intellectual Property the subject of a reexamination proceeding, and each Loan Party has performed all acts and has paid all renewal, maintenance, and other fees and taxes required to maintain each and every registration and application of Copyrights, Patents and Trademarks of such Loan Party constituting Material Intellectual Property in full force and effect.  No holding, decision, ruling, or judgment has been rendered in any action or proceeding before any court or administrative authority challenging the validity, enforceability, or scope of, or any Loan Party’s right to register, own or use, any Material Intellectual Property of such Loan Party, and no such action or proceeding is pending or, to the knowledge of any Authorized Officer of any Borrower, threatened, nor does any Loan Party know of any valid basis for any such action, except as would not reasonably be expected to have a Material Adverse Effect.  Except where the failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, (i) all registrations, issuances and applications for Copyrights, Patents and Trademarks of each Loan Party are standing in the name of such Loan Party (or the CKI Trust), and (ii) all exclusive Copyright Licenses constituting Material Intellectual Property in respect of registered Copyrights, if any, have been properly recorded in the United States Copyright Office or, where appropriate, any foreign counterpart.  To the knowledge of any Authorized Officer of any Borrower, the use of Material Intellectual Property by such Loan Party does not infringe or misappropriate the rights of any person, except as would not reasonably be expected to have a Material Adverse Effect.

(b)

Except where the failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, each Loan Party has been using appropriate statutory notice of registration in connection with its use of registered Trademarks, proper marking practices in connection with its use of Patents, and appropriate notice of copyright in connection with the publication of Copyrights.  Except where the failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, each Loan Party has taken commercially reasonable steps to protect the confidentiality of its Trade Secrets in accordance with industry standards.  Except where the failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, each Loan Party controls the nature and quality of all products sold and all services rendered by it under or in connection with its Trademarks, in each case consistent with industry practices, and has taken all commercially reasonable actions necessary to ensure that all licensees of the Trademarks owned by such Loan Party comply with such Loan Party’s standards of quality, in each case, to the extent such Trademarks constitute Material Intellectual Property.



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(c)

To the knowledge of any Authorized Officer of any Borrower, (i) the conduct of such Loan Party’s business does not infringe, misappropriate, dilute or otherwise violate any Intellectual Property right of any other Person, except where such infringement, misappropriation, dilution or other violation would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, and (ii) no claim exists that the use of any Material Intellectual Property owned or used by any Loan Party (or any of its respective licensees) infringes, misappropriates, dilutes or otherwise violates the asserted rights of any other Person.  To the knowledge of any Authorized Officer of any Borrower, no Person is infringing, misappropriating, diluting or otherwise violating any rights in any Intellectual Property owned, licensed or used by such Loan Party, or any of its respective licensees, except where such infringement, misappropriation, dilution or other violation would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  No settlement or consents, covenants not to sue, co-existence agreements, non-assertion assurances, or releases have been entered into by any Loan Party or bind any Loan Party in a manner that could adversely affect such Loan Party’s rights to own, license, transfer, or use any of the Material Intellectual Property in a manner consistent with the way such Loan Party conducts its business as of the date hereof.

(d)

Except as may be provided under the CKI Documents, neither the execution, delivery or performance of this Agreement and the other Loan Documents, nor the consummation of the Transactions and the other transactions contemplated hereby and thereby, will alter, impair or otherwise affect or require the consent, approval or other authorization of any other person in respect of any ownership, contractual or other right of any Loan Party in any Material Intellectual Property.

(e)

Except where the failure to do so would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, each Loan Party has taken commercially reasonable actions to maintain the secrecy and security of its and its Subsidiaries material Software, networks and databases, and to the knowledge of any Authorized Officer of any Borrower, none of the Software owned by the Loan Party or its Subsidiaries and material to their businesses contains any open source code where the consequences of containing such code would reasonably be expected to have a Material Adverse Effect.

Section 4.22

Ranking; Security

.  

(a)

Each Loan Party’s obligations under the Loan Documents ranks at least equally in right of payment with all of its unsecured and unsubordinated obligations, other than those that are mandatorily preferred by law applying to companies generally and other than with respect to the CKI Obligations and the 2023 Debentures Obligations to the extent set forth in the CKI Intercreditor Agreement.

(b)

Each Security Document creates the security interest that it purports to create and such security interests are valid and effective in all material respects to the extent required therein.

Section 4.23

Centre of Main Interests and Establishments

.  Each Loan Party whose jurisdiction of incorporation is in a member state of the European Union has its “centre of main interest” (as that term is used in Article 3(l) of The Council of the European



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Union Regulation No. 1346/2000 on Insolvency Proceedings (the “Regulation”) in its jurisdiction of incorporation and has no “establishment” (as that term is used in Article 2(h) of the Regulation) in any other jurisdiction.  

Section 4.24

Dutch Loan Parties

.  As of the Closing Date, no Dutch Loan Party has established a Works Council (ondernemingsraad) nor has it received any request to establish a Works Council, nor is it in the process of establishing one.

Section 4.25

Shares

.  

(a)

The shares of any Group Member which are subject to the German Security are fully paid in and not subject to any option to purchase or similar rights. The constitutional documents of companies whose shares are subject to the German Security do not restrict or inhibit any transfer of those shares on creation or enforcement of the German Security, unless appropriate resolutions to overcome such restrictions and/or inhibitions are taken to the satisfaction of the Collateral Agent. There are no agreements in force which provide for the issue or allotment of, or grant any person the right to call for the issue or allotment of, any share or loan capital of any member of the Group (including any option or right of pre-emption or conversion).

(b)

The shares of any Group Member which are subject to the Dutch Security are fully paid in and not subject to any option to purchase or similar rights. The constitutional documents of companies whose shares are subject to the Dutch Security do not restrict or inhibit any transfer of those shares on creation or enforcement of the Dutch Security save for any share transfer restrictions (blokkeringsregeling) pursuant to section 2:195 of the Dutch Civil Code, unless appropriate resolutions to overcome such restrictions and/or inhibitions are taken to the satisfaction of the Collateral Agent. There are no agreements in force which provide for the issue or allotment of, or grant any person the right to call for the issue or allotment of, any share or loan capital of any member of the Group (including any option or right of pre-emption or conversion).

ARTICLE V.
AFFIRMATIVE COVENANTS

Each Loan Party covenants and agrees that, so long as any Commitment is in effect and until Payment in Full of the Obligations, such Loan Party shall, and shall cause each of its Restricted Subsidiaries to:

Section 5.01

Financial Statements and Other Reports

.  In the case of the Borrower Representative, deliver to the Administrative Agent (which shall furnish to each Lender):

(a)

Quarterly Financial Statements.  As soon as available, and in any event within 45 days after the end of each Fiscal Quarter of each Fiscal Year (or, if earlier, the date required to be filed with the SEC, giving effect to any extension permitted by the SEC), commencing with the Fiscal Quarter in which the Closing Date occurs, the consolidated balance sheets of the Group as at the end of such Fiscal Quarter and the related consolidated statements of income, stockholders’ equity and cash flows of the Group for such Fiscal Quarter and for the



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period from the beginning of the then current Fiscal Year to the end of such Fiscal Quarter, setting forth in each case in comparative form the corresponding figures for the corresponding periods of the previous Fiscal Year, commencing with the first Fiscal Quarter for which such corresponding figures are available, and a Narrative Report with respect thereto, and the correspond­ing figures from the Financial Plan for the current Fiscal Year, all in reasonable detail, together with a Financial Officer Certification (the Borrower Representative being permitted to satisfy the requirements of this clause (a) (other than the requirement for a comparison to the Financial Plan) by delivery of the U.S. Borrower’s quarterly report on Form 10-Q (or any successor form), and all supplements or amendments thereto, as filed with the SEC);

(b)

Annual Financial Statements.  As soon as available, and in any event within 90 days after the end of each Fiscal Year (or, if earlier, the date required to be filed with the SEC, giving effect to any extension permitted by the SEC), commencing with the Fiscal Year in which the Closing Date occurs, (i) the consolidated balance sheets of the Group as at the end of such Fiscal Year and the related consolidated statements of income, stockholders’ equity and cash flows of the Group for such Fiscal Year, setting forth in each case in comparative form the corresponding figures for the previous Fiscal Year, commencing with the first Fiscal Year for which such corresponding figures are available, and a Narrative Report with respect thereto, and the corresponding figures from the Financial Plan for the Fiscal Year covered by such financial statements, in reasonable detail, together with a Financial Officer Certification (the Borrower Representative being permitted to satisfy the requirements of this clause (i) (other than the requirement for a comparison to the Financial Plan) by delivery of the U.S. Borrower’s annual report on Form 10-K (or any successor form), and all supplements or amendments thereto, as filed with the SEC); and (ii) with respect to such consolidated financial statements a report thereon of Ernst & Young LLP or another independent certified public accountant of recognized national standing selected by the U.S. Borrower (which report and/or the accompanying financial statements shall be unqualified as to going concern and scope of audit, and shall state that such consoli­dated financial statements fairly present, in all material respects, the consolidated financial position of the Group as at the dates indicated and the results of their operations and their cash flows for the periods indicated in conformity with GAAP applied on a basis consistent with prior years (except as otherwise disclosed in such financial state­ments) and that the examination by such accountants in connection with such consolidated financial statements has been made in accordance with generally accepted auditing standards) together, to the extent available pursuant to such accountant’s internal policies, with a written statement by such independent certified public accountants (which statement may be limited to accounting matters and disclaim responsibility for legal interpretations) that to the best of such accountant’s knowledge, as of the dates of the financial statements being furnished, no Default has occurred under the covenants set forth in Section 6.07 and if such a Default has occurred, specifying the nature and extent thereof.

(c)

Compliance Certificate; Guarantor Coverage Certificate.  (i) On the date that is 60 days following the Closing Date, a duly executed and completed Guarantor Coverage Certificate, (ii) together with each delivery of financial statements of the Group pursuant to Section 5.01(a), a duly executed and completed Compliance Certificate, (iii) together with each delivery of financial statements of the Group pursuant to Section 5.01(b), a duly executed and completed Compliance Certificate, (iv) together with each delivery of financial statements pursuant to Section 5.01(a) and (b), consolidated financial statements of income and cash flows



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and the related consolidated balance sheet covering the same periods reflecting adjustments necessary to eliminate the accounts of Unrestricted Subsidiaries, if any, from such financial statements delivered pursuant to Section 5.01(a) and (b), (v) within fifteen (15) days following each delivery of financial statements of the Group pursuant to Section 5.01(b), a duly executed and completed Guarantor Coverage Certificate and (vi) within ten (10) Business Days following any CKI Blockage Event, a duly executed and completed Compliance Certificate with respect to the most recently ended Fiscal Quarter for which a Compliance Certificate has been delivered that shall, in the case of this clause (vi), exclude CKI and any CKI Affiliate from any calculation of Consolidated Adjusted EBITDA;

(d)

Statements of Reconciliation after Change in Accounting Principles.  If, as a result of any change in accounting principles and policies from those used in the preparation of the Historical Financial Statements of the U.S. Borrower prior to giving effect to the Transactions, the consolidated financial statements of the Group delivered pursuant to Section 5.01(a) or 5.01(b) shall differ in any material respect from the consolidated financial statements that would have been delivered pursuant to such subdivisions had no such change in accounting principles and policies been made, then, together with the first delivery of such financial statements after such change (or as promptly as practicable thereafter), one or more statements of reconciliation for all such prior financial statements in form and substance reasonably satisfactory to the Administrative Agent;

(e)

Notice of Default.  Promptly upon any Authorized Officer of any Borrower obtaining knowledge (i) of any condition or event that constitutes a Default or an Event of Default or that notice has been given to any Loan Party with respect thereto; (ii) that any Person has given any notice to any Loan Party or any of its Subsidiaries or taken any other action with respect to any event or condition set forth in Section 8.01(b); (iii) of the occurrence of any event or change that has caused or evidences, either in any case or in the aggregate, a Material Adverse Effect, a certificate of an Authorized Officer specifying the nature and period of existence of such condition, event or change, or specifying the notice given and action taken by any such Person and the nature of such claimed Event of Default, Default, default, event or condition, and what action the applicable Group Member has taken, is taking and proposes to take with respect thereto; or (iv) the occurrence of any CKI Blockage Event;

(f)

Notice of Litigation.  Promptly upon any Authorized Officer of any Borrower obtaining knowledge of (i) any Adverse Proceeding not previously disclosed in writing by the Borrower Representative to the Lenders or (ii) any development in any Adverse Proceeding that, in the case of either clause (i) or (ii), would be reasonably expected to have a Material Adverse Effect, or seeks to enjoin or otherwise prevent the consumma­tion of, or to recover any damages or obtain relief as a result of, the transactions contemplated hereby, or the exercise of rights or performance of obligations under any Loan Document written notice thereof together with such other information as may be reasonably available to the U.S. Borrower to enable the Lenders and their counsel to evaluate such matters;

(g)

Pension Plans; ERISA.  Promptly (but in any event within three (3) days) upon the occurrence of or upon any Authorized Officer of any Loan Party becoming aware of the forthcoming occurrence of (A) any material ERISA Event, (B) the adoption of any new Pension Plan or Foreign Plan that provides pension benefits by any Loan Party, any of its Subsidiaries or



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any of their respective ERISA Affiliates, (C) the adoption of an amendment to a Pension Plan or Foreign Plan that provides pension benefits if such amendment results in a material increase in benefits or unfunded liabilities or (D) the commencement of contributions by any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates to a Multiemployer Plan or Pension Plan or Foreign Plan that provides pension benefits, a written notice specifying the nature thereof, what action any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates has taken, is taking or proposes to take with respect thereto and, when known, any action taken or threatened by the Internal Revenue Service, the Department of Labor or the PBGC with respect thereto; (ii) with reasonable promptness (but in any event within three (3) days after filing), copies of all notices received by any Loan Party, any of its Subsidiaries or any of their respective ERISA Affiliates from a Multiemployer Plan sponsor concerning an ERISA Event; and (iii) copies of such other documents or governmental reports or filings relating to any Employee Benefit Plan as the Administrative Agent shall reasonably request;

(h)

Financial Plan.  As soon as practicable and in any event no later than sixty (60) days after the beginning of each Fiscal Year, a consolidated plan and financial forecast for such Fiscal Year and each Fiscal Year (or portion thereof) thereafter through the final maturity date of the Loans (a “Financial Plan”), including a forecasted consolidated balance sheet and forecasted consolidated statements of income and cash flows of the Group for each Fiscal Quarter of such Fiscal Year and each other Fiscal Year, and an explanation of the assumptions on which such forecasts are based;

(i)

Insurance Report.  As soon as practicable and in any event within 90 days after the end of each Fiscal Year, a certificate from the Loan Parties’ insurance broker(s) in form and substance reasonably satisfactory to the Administrative Agent outlining all material insurance coverage maintained as of the date of such certificate by the Loan Parties and their Restricted Subsidiaries;

(j)

Notice Regarding CKI Documents.  Promptly, and in any event within ten (10) Business Days after any CKI Document is amended in any material respect, provide copies of such amendment to the Administrative Agent;

(k)

Information Regarding Collateral.  

(i)

the Borrower Representative shall furnish to the Collateral Agent prompt written notice of any change (A) in any Loan Party’s corporate or entity name, (B) in any Loan Party’s type of organization, (C) in any Loan Party’s jurisdiction of organization or (D) in any Loan Party’s Federal Taxpayer Identification Number or state organizational identification number.  Each Loan Party agrees not to effect or permit any change referred to in the preceding sentence unless all filings have been made (or will be made under any statutory period) under the UCC or otherwise that are required in order for the Collateral Agent to continue at all times following such change to have a valid, legal and perfected security interest in all the Collateral as contemplated in the Security Documents;

(ii)

at the time of delivery of annual financial statements pursuant to Section 5.01(b), each Loan Party shall deliver (which delivery may be by electronic



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means) to the Collateral Agent a supplement to Schedule 4.21 which shall list any registrations or applications for registration of Intellectual Property that was acquired after the later of the Closing Date and the date of the most recent supplement (if any) delivered pursuant to this Section by any Group Member that is, or pursuant to Section 5.12 becomes, a Loan Party; provided that this Section shall not limit the requirements of Section 5.14; and

(iii)

each Loan Party also agrees promptly to notify (or to have the Borrower Representative notify on its behalf) the Collateral Agent if any material portion of the Collateral is damaged or destroyed;

(l)

Annual Collateral Verification.  Each year, at the time of delivery of annual financial statements with respect to the preceding Fiscal Year pursuant to Section 5.01(b), each Loan Party shall deliver to the Collateral Agent a certificate of its Authorized Officer confirming that there has been no change in the information set forth in the Foreign Collateral Perfection Certificate or in the Perfection Certificate since the Closing Date or the date of the most recent certificate delivered pursuant to this Section and/or identifying such changes;

(m)

Management Letters.  Promptly after the receipt thereof by the U.S. Borrower, a copy of any “management letter” received by the U.S. Borrower from its certified public accountants and the management’s response thereto;

(n)

Certification of Public Information.  Each Borrower and each Lender acknowledge that certain of the Lenders may be “public-side” Lenders (Lenders that do not wish to receive material non-public information with respect to any Group Member or its Securities) and, if documents or notices required to be delivered pursuant to this Section 5.01 or otherwise are being distributed through IntraLinks/IntraAgency, SyndTrak or another relevant website or other information platform (the “Platform”), any document or notice that the Borrower Representative has indicated contains Non-Public Information shall not be posted on that portion of the Platform designated for such public-side Lenders.  The Borrower Representative agrees to clearly designate all Information provided to the Administrative Agent by or on behalf of the Borrowers which is suitable to make available to Public Lenders.  If the Borrower Representative has not indicated whether a document or notice delivered pursuant to this Section 5.01 contains Non-Public Information, the Administrative Agent reserves the right to post such document or notice solely on that portion of the Platform designated for Lenders who wish to receive material non-public information with respect to any Group Member and its Securities; and

(o)

Other Information.  (A) Promptly upon their becoming available, copies of (i) all financial statements, reports, notices and proxy statements sent or made available generally by any Group Member to their security holders acting in such capacity and (ii) all regular, periodic and current reports and all registration statements and prospectuses, if any, filed by any Group Member with any Securities exchange or with the SEC; provided that to the extent such information is filed with the SEC such information shall be deemed to have been provided under this subclause and (B) such other information and data with respect to any Group Member as from time to time may be reasonably requested by the Administrative Agent or any Lender through the Administrative Agent.



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Section 5.02

Existence

.  Except as otherwise permitted under Section 6.08, at all times preserve and keep in full force and effect its existence and all rights and franchises, licenses and permits material to its business; provided, that no Loan Party (other than any Borrower with respect to existence) or any of its Subsidiaries shall be required to preserve any such existence, right or franchise, licenses and permits if (a) failure to do so would not reasonably be expected to result in a Material Adverse Effect, or (b) such Person’s management shall determine that the preservation thereof is no longer desirable in the conduct of the business of such Person.

Section 5.03

Payment of Taxes and Claims

.  Pay all Taxes imposed upon it or any of its properties or assets or in respect of any of its income, businesses or franchises before any penalty or fine accrues thereon, and all claims (including claims for labor, services, materials and supplies) for sums that have become due and payable and that by law have or may become a Lien upon any of its properties or assets, prior to the time when any penalty or fine shall be incurred with respect thereto; provided, that no such Tax or claim need be paid to the extent it is being contested in good faith by appropriate proceedings promptly instituted and diligently conducted, so long as adequate reserves or other appropriate provisions as shall be required in conformity with GAAP shall have been made therefor.

Section 5.04

Maintenance of Properties

.  (a) In the case of material tangible properties used in the business of the Loan Parties and their Restricted Subsidiaries, maintain or cause to be maintained such tangible properties in good repair, working order and condition, ordinary wear and tear excepted, and from time to time shall make or cause to be made all appropriate repairs, renewals and replacements thereof; and (b) in the case of intangible material properties that are used or useful in the business of the Loan Parties and their Restricted Subsidiaries, maintain such intangible properties as valid and enforceable, in each case except as would not reasonably be expected to result in a Material Adverse Effect.

Section 5.05

Insurance

.  

(a)

In the case of the Borrower Representative, maintain or cause to be maintained, with financially sound and reputable insurers, such public liability insurance, third party property damage insurance, business interruption insurance and casualty insurance with respect to liabilities, losses or damage in respect of the assets, properties and businesses of the Loan Parties and their Restricted Subsidiaries as may customarily be carried or maintained under similar circumstances by Persons of established reputation engaged in similar businesses, in each case in such amounts (giving effect to self-insurance), with such deductibles, covering such risks and otherwise on such terms and conditions as are customary for such Persons.  Without limiting the generality of the foregoing, the Borrower Representative shall maintain or cause to be maintained (i) flood insurance that covers each Real Estate Asset subject to a mortgage in favor of Collateral Agent, for the benefit of Secured Parties, that is located in a Flood Zone, in each case in compliance with any applicable regulations of the Board of Governors, (ii) replacement value casualty insurance on the Collateral under such policies of insurance, with such insurance companies, in such amounts, with such deductibles, and covering such risks as are at all times carried or maintained under similar circumstances by Persons of established reputation engaged in similar businesses.  Each such policy of insurance with respect to a Loan Party shall (i) name the Secured Parties as additional insured parties thereunder as their interests may appear, (ii) in



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the case of each casualty insurance policy, contain a loss payable clause or endorsement, satisfactory in form and substance to the Collateral Agent, that names the Collateral Agent, on behalf of the Secured Parties, as the loss payee thereunder and (iii) provide that the insurer affording coverage (with respect to property and liability insurance) will provide for at least thirty (30) days’ prior written notice to the Collateral Agent of any material modification or cancellation of such policy.

Section 5.06

Books and Records; Inspections

.  Maintain proper books of record and accounts in conformity in all material respects with GAAP.  Each Loan Party shall, and shall cause each of its Subsidiaries to, permit any authorized representatives designated by the Administrative Agent to visit and inspect any of the properties of any Loan Party and any of its respective Subsidiaries, to examine and inspect, its and their financial and accounting records and, with the prior consent of an Authorized Officer of the Loan Party, to discuss its and their affairs, finances and accounts with its and their officers and independent public accountants, all upon reasonable notice and at such reasonable times during normal business hours and as often as may reasonably be requested (but, so long as no Default or Event of Default shall have occurred or be continuing, no more often than once per Fiscal Quarter).

Section 5.07

Lenders’ Calls

.  In the case of the Borrowers, upon the request of the Administrative Agent or the Required Lenders, participate in a conference call with the Administrative Agent and the Lenders once during each Fiscal Year at such time as may be agreed to by the Borrower Representative and the Administrative Agent.

Section 5.08

Compliance with Material Contractual Obligations and Laws

.  Comply with the requirements of all material Contractual Obligations (including the Acquisition Documents) and all applicable laws, rules, regulations and orders of any Governmental Authority (including all Environmental Laws), noncompliance with which would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.  

Section 5.09

Environmental

.  

(a)

Environmental Disclosure.  In the case of the Borrower Representative, deliver to the Administrative Agent and the Lenders:

(i)

as soon as practicable following receipt thereof, copies of all environmental assessments, audits, investigations, analyses and reports of any kind or character, whether prepared by personnel of any Group Member or by any independent consultants, Governmental Authorities or other Persons, with respect to significant environmental matters at any Facility or with respect to any Environmental Claims;

(ii)

promptly upon knowledge of any Authorized Officer of any Borrower thereof, written notice relating to (1) any Release required to be reported to Governmental Authority under any applicable Environmental Laws, (2) any remedial action taken by any Loan Party or any other Person in response to (A) any Hazardous Materials the existence of which has a reasonable possibility of resulting in one or more Environmental Claims having, individually or in the aggregate, a Material Adverse Effect



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or (B) any Environmental Claims that, individually or in the aggregate, have a reasonable possibility of resulting in a Material Adverse Effect, (3) any occurrence or condition on any real property adjoining or in the vicinity of any Facility that could cause such Facility or any part thereof to be subject to any material restrictions on the ownership, occupancy, transferability or use thereof under any Environmental Laws in a manner that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect or (4) the imposition or written threat of any imposition of any Lien (other than a Permitted Lien) on any Collateral pursuant to any Environmental Law;

(iii)

as soon as practicable following the sending or receipt thereof by any Group Member, a copy of (1) any and all material written communications with respect to any Environmental Claims that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect, (2) any report sent to any Governmental Authority or other material written communications regarding a Release required to be reported to such Governmental Authority that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect and (3) any material written communications responding to any request for information from any Governmental Authority that suggests such Governmental Authority is investigating whether any Group Member may be potentially responsible for any Hazardous Materials Activity that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect;

(iv)

written notice (delivered in each instance as soon as practicable) describing in reasonable detail (1) any proposed acquisition of stock, assets, or other property by any Group Member that would reasonably be expected to expose any Group Member to, or result in, Environmental Claims that would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect and (2) any proposed action to be taken by any Group Member to modify current operations in a manner that would reasonably be expected to subject any Group Member to Environmental Claims that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect; and

(v)

with reasonable promptness, such other documents and information as from time to time may be reasonably requested by the Administrative Agent in relation to any matters disclosed pursuant to this Section 5.09(a).

(b)

Environmental Claims, Etc.  Promptly take any and all actions necessary to (i) cure any violation of applicable Environmental Laws by such Group Member that would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, (ii) conduct any investigative or remedial action that may be required pursuant to applicable Environmental Laws by such Group Member that would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect, and (iii) make an appropriate response to any Environmental Claim against such Group Member and discharge any obligations it may have to any Person thereunder where failure to do so would reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect.



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(c)

Environmental Compliance.  Use and operate all of its Facilities in compliance with all Environmental Laws, keep all necessary Governmental Authorizations required pursuant to any Environmental Laws, and handle all Hazardous Materials in compliance with all Environmental Laws, in each case except where the failure to comply with the terms of this clause would not reasonably be expected to have a Material Adverse Effect.

Section 5.10

Maintenance of Ratings.

  In the case of the U.S. Borrower, at all times use commercially reasonable efforts to maintain public corporate family and public corporate credit ratings issued by Moody’s and S&P and public ratings issued by Moody’s and S&P with respect to the credit facilities hereunder.

Section 5.11

Intellectual Property

.  

(a)

No Loan Party shall do any act or omit to do any act which would reasonably be expected to cause any Material Intellectual Property, so long as it remains Material Intellectual Property, to lapse, or become abandoned, canceled, dedicated to the public, forfeited, unenforceable or otherwise impaired, or which would adversely affect the validity, grant, or enforceability of the security interest granted therein.  No Loan Party shall, with respect to any Trademarks constituting Material Intellectual Property, cease the use of any of such Trademarks, except in the ordinary course of business, or fail to maintain the level of the quality of products sold and services rendered under any of such Trademark at a level at least substantially consistent with the quality of such products and services as of the date hereof, and such Loan Party shall take all commercially reasonable steps necessary to insure that licensees of such Trademarks use such consistent standards of quality.  Each Loan Party shall, within thirty (30) days of the creation or acquisition or exclusive license of any copyrightable work that is included in the Material Intellectual Property, apply to register the Copyright in the United States Copyright Office or, where appropriate, any foreign counterpart and, in the case of an exclusive Copyright License in respect of a registered Copyright constituting Material Intellectual Property, record such license, in the United States Copyright Office or, where appropriate, any foreign counterpart.  Each Loan Party shall take all reasonable steps, including in any proceeding before the United States Patent and Trademark Office, the United States Copyright Office, any state registry or any foreign counterpart of the foregoing, to pursue any application and maintain any registration or issuance of each Trademark, Patent, and Copyright owned by any Loan Party and constituting Material Intellectual Property.

(b)

Each Loan Party shall promptly notify the Collateral Agent if it knows that any item of Material Intellectual Property, so long as it remains Material Intellectual Property, has become (i) abandoned or dedicated to the public or placed in the public domain, (ii) invalid or unenforceable, (iii) subject to any adverse determination or development regarding any Loan Party’s ownership, registration or use or the validity or enforceability of such item of Intellectual Property (including any adverse development with respect to any action or proceeding in the United States Patent and Trademark Office, the United States Copyright Office, any state registry, any foreign counterpart of the foregoing, or any court) or (iv) the subject of any reversion or termination rights.  

(c)

Except as provided in or permitted under Section 6.02, each Loan Party shall use best efforts so as not to permit the inclusion in any contract to which it hereafter



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becomes a party of any provision that could or may in any way materially impair or prevent the creation of a security interest in, or the assignment of, such Loan Party’s ownership interests in any Intellectual Property acquired under such contracts that would become Material Intellectual Property.

(d)

In the event that any Material Intellectual Property owned by any Loan Party is infringed, misappropriated, diluted or otherwise violated by a third party and such infringement, misappropriation, dilution or other violation would reasonably be expected to have a Material Adverse Effect, such Loan Party shall promptly take all commercially reasonable actions to stop such infringement, misappropriation, dilution or other violation and protect its rights in such Material Intellectual Property including, but not limited to, the initiation of a suit for injunctive relief and to recover damages.

Section 5.12

Subsidiaries

.  

(a)

In the case of the Borrower Representative, in the event that any Person becomes a U.S. Subsidiary of the U.S. Borrower after the date hereof, (a) promptly cause such U.S. Subsidiary to become a Guarantor hereunder and a U.S. Grantor under the U.S. Pledge and Security Agreement or the CKI Related Assets Pledge and Security Agreement, as applicable, by executing and delivering to the Administrative Agent and the Collateral Agent a Counterpart Agreement, and (b) promptly take all such actions and execute and deliver, or cause to be executed and delivered, all such documents, instruments, agreements, and certificates as are similar to those described in Sections 3.01(b) and 3.01(h), and the Borrower Representative shall promptly take or cause to be taken all of the actions referred to in Section 3.01(h) necessary to grant and to perfect a First Priority Lien in favor of the Collateral Agent, for the benefit of the Secured Parties, under the applicable Security Documents, in the Equity Interests of any such new U.S. Subsidiary (provided that in no event shall (1) more than 66% of the voting Equity Interests of any Foreign Subsidiary directly owned by a U.S. Subsidiary or more than 66% of the Equity Interests of any U.S.-Owned DRE be required to be so pledged as security for the Obligations of the U.S. Borrower and (2) no pledge of the Equity Interests of any other Foreign Subsidiary shall be required as security for the Obligations of the U.S. Borrower).

(b)

In the case of the Borrower Representative, with respect to any Foreign Subsidiary formed or acquired after the Closing Date that is, or any Foreign Subsidiary acquired pursuant to the Acquisition that becomes, after the Closing Date (but, for the avoidance of doubt, excluding any Subsidiary of the U.S. Borrower prior to the Acquisition as listed on Schedule 5.12(b)), (i) a Material Company (excluding any Material Company organized under the laws of Japan), (ii) the direct or indirect parent of any Borrower or Material Company or (iii) to the extent required in order to comply with Section 5.18, any other Foreign Subsidiary that the U.S. Borrower shall select in its sole discretion, including, if so selected, any Material Company organized under the laws of Japan, (x) subject to the Agreed Security Principles, promptly cause such Foreign Subsidiary to become a Guarantor hereunder solely in respect of the Obligations of the Foreign Borrower by executing and delivering to the Administrative Agent a Counterpart Agreement and a party to any applicable Foreign Law Security Document (provided that any Material Company organized under the laws of Japan shall not be under an obligation to provide any Foreign Law Security Document) and (y) subject to the Agreed Security Principles, promptly take all such actions and execute and deliver, or cause to be executed and delivered, all



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such documents, instruments, agreements, and certificates as are necessary to grant a perfected First Priority Lien in favor of the Collateral Agent, for the benefit of the applicable Foreign Obligations Secured Parties, in substantially all of such Foreign Subsidiary’s assets (subject always to the Agreed Security Principles), and the Borrower Representative shall promptly take or shall cause the applicable Group Member to take all of the actions necessary to grant and to perfect a First Priority Lien in favor of the Collateral Agent, for the benefit of the Foreign Obligations Secured Parties, under the applicable Security Documents, in the Equity Interests of any such new Foreign Subsidiary.  In addition, if any Foreign Subsidiary becomes an Ancillary Borrower hereunder, subject to the Agreed Security Principles, it shall take all such actions and execute and deliver, or cause to be executed and delivered, all such documents, instruments, agreements and certificates as are necessary to grant a perfected First Priority Lien in favor of the Collateral Agent, for the benefit of the Foreign Obligations Secured Parties, in substantially all of such Foreign Subsidiary’s assets (subject to the Agreed Security Principles).  Notwithstanding the foregoing, any Obligations with respect to Real Estate Assets shall be governed by Section 5.13.  

(c)

With respect to each new Restricted Subsidiary, the Borrower Representative shall promptly send to the Collateral Agent written notice setting forth with respect to such Person (i) the date on which such Person became a Group Member and (ii) all of the data required to be set forth in Schedules 3.01(c) and 4.02 with respect to all Subsidiaries of the U.S. Borrower; and such written notice shall be deemed to supplement Schedule 3.01(c) and 4.02 for all purposes hereof.

(d)

No Subsidiary listed on Schedule 5.12(b) shall under any circumstance be required to become a Guarantor or otherwise guaranty the Obligations of any Borrower, it being understood and agreed that nothing in this Section 5.12(d) shall affect the obligation of the Loan Parties to comply with the requirements of Section 5.18.

Section 5.13

Additional Material Real Estate Assets

.  In the event that any Loan Party acquires a Material Real Estate Asset or a Real Estate Asset owned or leased on the Closing Date becomes a Material Real Estate Asset and such interest has not otherwise been made subject to the Lien of the Security Documents in favor of the Collateral Agent, for the benefit of Secured Parties, in the case of such Loan Party, promptly take to the fullest extent commercially practical all such actions and execute and deliver, or cause to be executed and delivered, all such mortgages, documents, instruments, agreements, opinions and certificates similar to those described in Section 3.01(g) with respect to each such Material Real Estate Asset that the Collateral Agent shall reasonably request to create in favor of the Collateral Agent, for the benefit of Secured Parties, a valid and, subject to any filing and/or recording referred to herein, perfected First Priority security interest in such Material Real Estate Assets.  

Section 5.14

Additional Collateral

.  With respect to any assets or property acquired after the Closing Date by any Group Member that is, or pursuant to Section 5.12 becomes, a Loan Party (other than (x) any assets or property described in Section 5.12 or Section 5.13 and (y) any assets or property subject to a Lien expressly permitted by Section 6.02) as to which the Collateral Agent, for the benefit of the Secured Parties, does not have a perfected First Priority Lien, promptly (i) execute and deliver to the Collateral Agent such amendments to the Security Documents or such new Security Documents as the Collateral Agent deems



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necessary or advisable to grant to the Collateral Agent, for the benefit of the applicable Secured Parties, a perfected First Priority Lien in such assets or property and (ii) take all actions necessary or advisable to grant to the Collateral Agent, for the benefit of the applicable Secured Parties, a perfected First Priority Lien in such assets or property, including without limitation, authorizing the Collateral Agent to file UCC financing statements in such jurisdictions as may be required by the U.S. Security Agreements, or by law or as may be requested by the Collateral Agent (subject, in the case of Foreign Loan Parties, to the Agreed Security Principles).  Notwithstanding anything in this Section 5.14 or in Sections 5.12, 5.13 or 5.16 to the contrary, Sections 5.12, 5.13, 5.14 and 5.16 shall not (x) apply to any property or Subsidiary created or acquired after the Closing Date, as applicable, as to which the Administrative Agent has determined in its sole discretion that the collateral value thereof is insufficient to justify the difficulty, time and/or expense of obtaining a perfected security interest therein or (y) require a grant or perfection of a security interest (i) in any asset excluded by the applicable security document, or (ii) in violation of the Agreed Security Principles.  

Section 5.15

Interest Rate Protection

.  In the case of the U.S. Borrower, no later than ninety (90) days following the Closing Date and at all times thereafter until the third anniversary of the Closing Date, obtain and cause to be maintained protection against fluctuations in interest rates pursuant to one or more Interest Rate Agreements in form and substance reasonably satisfactory to the Administrative Agent, in order to ensure that no less than 25% of the aggregate principal amount of the total Indebtedness for borrowed money of the Group then outstanding is either (i) subject to such Interest Rate Agreements or (ii) Indebtedness that bears interest at a fixed rate.

Section 5.16

Further Assurances

.  At any time or from time to time upon the request of the Administrative Agent, at the expense of the Loan Parties, promptly execute, acknowledge and deliver such further documents and do such other acts and things as the Administrative Agent or the Collateral Agent may reasonably request in order to effect fully the purposes of the Loan Documents or to more fully perfect or renew the rights of the Administrative Agent or the Lenders with respect to the Collateral (or with respect to any additions thereto or replacements or proceeds thereof or with respect to any other property or assets hereafter acquired by any Group Member which may be deemed to be part of the Collateral), subject, in the case of Foreign Loan Parties, to the Agreed Security Principles.  In furtherance and not in limitation of the foregoing, each Loan Party shall take such actions as the Administrative Agent or the Collateral Agent may reasonably request from time to time to ensure that the Obligations are guarantied by the Guarantors and are secured by the assets of each Loan Party in each case, to the extent otherwise required by this Agreement and subject to the Agreed Security Principles.  Upon the exercise by the Administrative Agent or the Collateral Agent of any power, right, privilege or remedy pursuant to this Agreement or the other Loan Documents which required any consent, approval, recording, qualification or authorization of any Governmental Authority, the U.S. Borrower or the applicable Loan Party will execute and deliver, or will cause the execution and delivery of, all applications, certifications, instruments and other documents and papers that the Administrative Agent or the Collateral Agent may be required to obtain from such Loan Party for such consent, approval, recording, qualification or authorization.



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Section 5.17

Foreign Bank Accounts and Cash held by Foreign Group Member

.  

(a)

Subject to paragraph (b) below, no Foreign Loan Party will or will permit any of its Subsidiaries to maintain, at any time, any cash in excess of $7,500,000 in the aggregate on deposit with a bank other than an Acceptable Bank.   

(b)

No Foreign Loan Party shall be required to cause any Subsidiary to transfer any cash under clause (a) if doing so would cause such Foreign Loan Party or such Subsidiary to (i) incur a material U.S. federal income Tax liability by reason of Section 956 of the Internal Revenue Code (except to the extent such liability is avoidable through use of commercially reasonable efforts) or other material cost or expense or (ii) breach any applicable law or Contractual Obligation or result in personal liability for such Foreign Loan Party or such Subsidiary or any of their respective directors (managing or otherwise) or management (except to the extent such breach or liability is avoidable through use of commercially reasonable efforts).

Section 5.18

Guarantor Coverage Test

.  As of (i) any one date between the Closing Date and the date that is 60 days after the Closing Date, and (ii) any one date between the date that financial statements are delivered pursuant to Section 5.01(b) and the date that is 45 days following such date, in each case, as demonstrated by a Guarantor Coverage Certificate dated as of such date,

(i)

the aggregate (without duplication) Group Member Adjusted EBITDA attributable to the Loan Parties as a group is no less than 80% of Consolidated Adjusted EBITDA; and

(ii)

the aggregate (without duplication) Group Member Assets of the Loan Parties as a group is no less than 80% of Consolidated Total Assets.

Section 5.19

Post-Closing Obligations

.  Satisfy the requirements set forth on Schedule 5.19 on the earlier of (i) the date specified for such requirement and (ii) 60 days after the Closing Date (or, in each case, such later date as the Administrative Agent shall agree in its reasonable discretion).

ARTICLE VI.
NEGATIVE COVENANTS

Each Loan Party covenants and agrees that, so long as any Commitment is in effect and until Payment in Full of the Obligations, such Loan Party shall not, nor shall it cause or permit any of its Restricted Subsidiaries to:

Section 6.01

Indebtedness

.  Create, incur, assume or guaranty, or otherwise become or remain liable with respect to any Indebtedness, except:

(a)

the Obligations;



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(b)

(i) Indebtedness in respect of the 2023 Debentures, (ii) Indebtedness of the U.S. Borrower in respect of the 2020 Notes in an aggregate principal amount not to exceed $600,000,000 and guaranty obligations of any U.S. Guarantor in respect of such Indebtedness, (iii) any Permitted Refinancing of the Indebtedness described in clause (i) or (ii), and (iv) Indebtedness in respect of the Existing Notes to the extent such Existing Notes remain outstanding after consummation of the tender offer therefor;

(c)

Indebtedness of any Restricted Subsidiary owed to any Borrower or to any other Restricted Subsidiary, or of any Borrower owed to any Restricted Subsidiary or any other Borrower; provided, that (i) all such Indebtedness shall be evidenced by an intercompany note, and, if owed to a Loan Party, shall (subject to the Agreed Security Principles) be subject to a First Priority Lien pursuant to the Security Documents, (ii) all such Indebtedness shall be unsecured and subordinated in right of payment to the payment in full of the Obligations in a manner consistent with the subordination provisions set forth in Section 7.07 and shall be Subordinated Indebtedness hereunder, (iii) any payment by any such Guarantor under any guaranty of the Obligations shall result in a pro tanto reduction of the amount of any Indebtedness owed by such Subsidiary to such Borrower or to any of its Subsidiaries for whose benefit such payment is made and (iv) such Indebtedness is permitted as an Investment under Section 6.06;

(d)

(1) unsecured Indebtedness of U.S. Borrower, the net proceeds of which are used solely to (i) consummate Permitted Acquisitions or (ii) repay the Term Loans (or repay Revolving Loans with a permanent equivalent reduction in the Revolving Commitments); provided, in each case, that such Indebtedness (a) matures at least three months after the maturity date of the Term Loans, (b) has a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Term Loans, (c) does not contain maintenance covenants that are more restrictive than Sections 6.07(a) and (b) and (d) if guaranteed, is guaranteed only by U.S. Guarantors; provided, that both immediately prior and after giving effect to the incurrence thereof, (x) no Default or Event of Default shall exist or result therefrom and (y) the U.S. Borrower shall be in compliance with the covenants set forth in Sections 6.07(a) and (b) after giving pro forma effect to the incurrence of such Indebtedness and the consummation of such Permitted Acquisition or repayment of such Loans, as applicable and (2) any Permitted Refinancings of such Indebtedness;

(e)

Indebtedness incurred by any Group Member arising from agreements providing for indemnification, adjustment of purchase price, other compensation or similar obligations (including, Indebtedness consisting of the deferred purchase price of assets or property acquired in a Permitted Acquisition), in connection with Permitted Acquisitions, permitted Investments or permitted dispositions of any business, assets or Subsidiary of any Group Member;

(f)

Indebtedness which may be deemed to exist pursuant to any guaranties, performance, surety, statutory, appeal bonds or similar obligations incurred in the ordinary course of business;

(g)

Indebtedness in respect of netting services, overdraft protections and otherwise in connection with deposit accounts;



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(h)

guaranties in the ordinary course of business of the obligations of suppliers, customers, franchisees and licensees of any Group Member;

(i)

guaranties by (i) any Borrower of Indebtedness of a Guarantor or any other Borrower or guaranties by a Guarantor of Indebtedness of any Borrower or any other Guarantor with respect, in each case, to Indebtedness otherwise permitted to be incurred by such Borrower or such Guarantor pursuant to this Section 6.01 (other than clauses (b) and (c) of this Section); provided, that if the Indebtedness that is being guarantied is unsecured and/or subordinated to the Obligations, the guaranty shall also be unsecured and/or subordinated to the Obligations, (ii) any Group Member that is not a Loan Party of Indebtedness of any other Group Member that is not a Loan Party and (iii) the U.S. Borrower of Indebtedness of any Group Member that is not a Loan Party incurred in the ordinary course of business on ordinary business terms so long as such Indebtedness is otherwise permitted to be incurred under Section 6.01(r) to the extent such guaranties are unsecured and otherwise permitted as an Investment under Section 6.06 (other than Section 6.06(q));

(j)

Indebtedness existing on the Closing Date which is described in Schedule 6.01 and any Permitted Refinancing thereof;

(k)

Indebtedness (i) in an amount not to exceed at any one time outstanding $40,000,000 (or, if the Incurrence Test is satisfied on a pro forma basis, 0.75% of Consolidated Total Assets, if greater), which is incurred with respect to Capital Leases or constitutes purchase money Indebtedness to finance the acquisition, lease, construction or improvement of assets or property and any Permitted Refinancing in respect thereof; provided, that any such Indebtedness shall be secured only by the asset acquired, leased, constructed or improved in connection with the incurrence of such Indebtedness, be incurred within 270 days of the acquisition, lease, construction or improvement of the relevant equipment or other asset and constitute not less than 75.0% of the aggregate consideration paid with respect to such acquisition, lease, construction or improvement and (ii) constituting Attributable Indebtedness with respect to any Sale and Lease-Back permitted under Section 6.10 in an amount not to exceed at any one time outstanding $35,000,000;

(l)

(i) (1) Indebtedness of a Person or Indebtedness attaching to assets of a Person that, in either case, becomes a Loan Party or becomes or is merged into or consolidated with a Subsidiary after the Closing date or (2) Indebtedness attaching to assets that are acquired by any Group Member after the Closing Date as the result of a Permitted Acquisition; provided, that (x) such Indebtedness existed at the time such Person became a Loan Party or became or was merged into or consolidated with a Subsidiary or at the time such assets were acquired and, in each case, was not created in contemplation thereof and (y) such Indebtedness is not guaranteed in any respect by any Group Member (other than (A) by any such Person that so becomes a Subsidiary or (B) to the extent any Group Member is otherwise permitted to guaranty such Indebtedness under another provision under this Section 6.01) and (ii) any Permitted Refinancing thereof;

(m)

Indebtedness of the type described in clause (viii) of the definition thereof with respect to interest rates or foreign exchange rates, or any Treasury Transaction; provided that in each case such Indebtedness shall not have been entered into for speculation purposes;



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(n)

(i) Indebtedness incurred by a Securitization Subsidiary in a Qualified Securitization Financing that is not recourse (except for Standard Securitization Undertakings) to any of the Borrowers or the Guarantors, (ii) Indebtedness of a Group Member consisting of Standard Securitization Undertakings provided that, in each case, the Net Cash Proceeds with respect to such Indebtedness are used to repay Term Loans and will be applied as set forth in Section 2.15(b) and (iii) Indebtedness incurred with respect to any disposition of accounts receivable in connection with receivables factoring arrangements in the ordinary course of business;

(o)

Indebtedness owing to any insurance company in connection with the financing of any insurance premiums permitted by such insurance company in the ordinary course of business;

(p)

Indebtedness incurred in the ordinary course of business with respect to surety and appeal bonds, performance and insurance bonds and similar obligations;

(q)

Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business or other cash management services in the ordinary course of business; provided that such Indebtedness (i) is extinguished within five Business Days of its incurrence or (ii) if in respect of credit or purchase cards, is extinguished within 60 days of its incurrence;

(r)

other Indebtedness of Subsidiaries (other than a Securitization Subsidiary) that are not Loan Parties and Indebtedness incurred on behalf of or representing guaranties of Indebtedness of Joint Ventures in an amount not to exceed at any one time outstanding $125,000,000 (or, if the Incurrence Test is satisfied on a pro forma basis, 2.0% of Consolidated Total Assets, if greater);

(s)

other Indebtedness of any Group Member (other than a Securitization Subsidiary) in an aggregate amount not to exceed at any one time outstanding $150,000,000;

(t)

Indebtedness arising as a result of (the establishment of) a fiscal unity (fiscale eenheid) between the Dutch Loan Parties;

(u)

Indebtedness pursuant to a declaration of joint and several liability used for the purpose of Section 2:403 of the Dutch Civil Code (and any residual liability under such declaration arising pursuant to section 2:404(2) of the Dutch Civil Code);

(v)

Indebtedness representing the deferred obligation to purchase common stock or common stock options permitted under Section 6.04(c);

(w)

Indebtedness arising under any domination and/or profit transfer agreement (Beherrschungs und/oder Gewinnabführungsvertrag) with a German Loan Party which is in force on the Closing Date;

(x)

Indebtedness in respect of letters of credit, bank guarantees, warehouse receipts or similar instruments issued to support performance obligations and trade-related letters



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of credit (other than obligations in respect of other Indebtedness) in the ordinary course of business;

(y)

Indebtedness of the U.S. Borrower in respect of letters of credit issued by the U.S. Borrower for its own account or for the account of any other Group Member; provided that neither the Administrative Agent nor any Lender shall have any direct or indirect liability with respect to any such letter of credit, whether as a guarantor, confirming bank or otherwise;

(z)

Indebtedness, if any, in respect of the CKI Obligations and the Itochu Obligations and any Permitted Refinancing of the Itochu Obligations;

(aa)

unsecured Indebtedness in respect of obligations of any Group Member to pay the deferred purchase price of goods or services or progress payments in connection with such goods and services; provided that such obligations are incurred in connection with open accounts extended by suppliers on customary trade terms (which require that all such payments be made within 60 days after the incurrence of the related obligations) in the ordinary course of business, and not in connection with the borrowing of money or any Currency Agreement, Interest Rate Agreement or Treasury Transaction;

(bb)

Indebtedness representing deferred compensation to employees of any Group Member incurred in the ordinary course of business; and

(cc)

all premium (if any), interest (including post-petition interest), fees, expenses, charges and additional or contingent interest on obligations described in paragraphs (a) through (bb) above.

Section 6.02

Liens

.  Create, incur, assume or permit to exist any Lien on or with respect to any property or asset of any kind (including any document or instrument in respect of goods or accounts receivable) of any Loan Party or any of its Restricted Subsidiaries, whether now owned or hereafter acquired or licensed, or any income, profits or royalties therefrom, except:

(a)

Liens granted pursuant to any Loan Document in favor of the Collateral Agent for the benefit of Secured Parties;

(b)

Liens for Taxes to the extent obligations with respect to such Taxes are being contested in good faith by appropriate proceedings promptly instituted and diligently conducted and so long as adequate reserves or other appropriate provisions as shall be required in conformity with GAAP shall have been made therefore and Liens for Taxes not yet due and payable;

(c)

statutory Liens of landlords, banks (and rights of set-off), of carriers, warehousemen, mechanics, repairmen, workmen and materialmen, and other Liens imposed by law (other than any such Lien imposed pursuant to Section 430(k) of the Internal Revenue Code or Section 303(k) of ERISA or a violation of Section 436 of the Internal Revenue Code), in each case incurred in the ordinary course of business (i) for amounts not yet overdue or (ii) for amounts that are overdue and that (in the case of any such amounts overdue for a period in excess of ten (10) days) are being contested in good faith by appropriate proceedings, so long as



145






such reserves or other appropriate provisions, if any, as shall be required by GAAP shall have been made for any such contested amounts;

(d)

Liens incurred in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security, or to secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, leases, government contracts, trade contracts, performance and return-of-money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money or other Indebtedness), so long as no foreclosure, sale or similar proceedings have been commenced with respect to any portion of the Collateral on account thereof;

(e)

easements, rights-of-way, restrictions, encroachments, and other defects or irregularities in title, in each case which do not and will not interfere in any material respect with the ordinary conduct of the business of any Group Member;

(f)

any interest or title of a lessor or sublessor under any lease of real estate permitted hereunder and covering only the assets so leased;

(g)

Liens solely on any cash earnest money deposits made by any Group Member in connection with any letter of intent or purchase agreement permitted hereunder;

(h)

Liens evidenced by the filing of precautionary UCC financing statements relating solely to operating leases of personal property entered into in the ordinary course of business;

(i)

Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;

(j)

any zoning or similar law or right reserved to or vested in any governmental office or agency to control or regulate the use of any real property;

(k)

any reservations, limitations, exceptions, provisos and conditions, if any, expressed in any original grants from the Crown, including, without limitation, the reservation of any mines and minerals in the Crown or in any other Person;

(l)

licenses or sublicenses (including licenses or sublicenses of Patents, Copyrights, Trademarks and other Intellectual Property rights), leases or subleases granted by any Group Member in the ordinary course of business which does not materially interfere with the business of the Group Members taken as a whole;

(m)

Liens in favor of vendors of goods arising as a matter of law securing the payment of the purchase price therefor so long as such Liens attach only to the purchased goods or, where customary in the local market, Liens arising from a contract securing (i) the payment of the purchase price of goods, (ii) the performance of any work or (iii) the fulfillment of any obligation arising out of the non-compliance with such contract;

(n)

Liens existing on the Closing Date which are described in Schedule 6.02 and replacements, renewals or extensions of such Liens; provided, that such Lien shall not apply



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to additional property other than (A) after-acquired property that is related to the property covered by such Lien and (B) proceeds and products thereof and such Lien shall secure only those obligations it secures on the Closing Date and extensions, renewals and replacements thereof that, to the extent constituting Indebtedness, qualify as a Permitted Refinancing thereof;

(o)

Liens arising under any retention of title, hire purchase or conditional sale arrangement or arrangements having similar effect in respect of goods supplied to a Group Member in the ordinary course of trading and on the supplier’s standard or usual terms and arising as a result or omission by any Group Member, including, for the avoidance of doubt, verlängerte Eigentumsvorbehalte and erweiterte Eigentumsvorbehalte;

(p)

Liens securing Indebtedness permitted pursuant to Section 6.01(k); provided, that any such Lien shall encumber only the property subject to the underlying lease, after-acquired property that is required to be pledged pursuant to such underlying lease on customary terms and proceeds and products thereof;

(q)

Liens securing Indebtedness permitted by Section 6.01(l) and any extensions, renewals and replacements thereof that, to the extent constituting Indebtedness, qualify as a Permitted Refinancing thereof, provided, that any such Lien shall encumber only assets and property of the Person so acquired or only attach to those assets which secured such Indebtedness at the time such assets were acquired by the Group other than (A) after-acquired property that is directly related to the property secured by such Lien and (B) proceeds and products thereof;

(r)

Liens arising from judgments in circumstances not constituting an Event of Default under Section 8.01(i);

(s)

Liens on Securitization Assets or a Securitization Subsidiary’s other assets arising in connection with a Qualified Securitization Financing;

(t)

Liens arising by virtue of any statutory, contractual or common law provision relating to banker’s liens, rights of set-off or similar rights (i) relating to the establishment of depository relations in the ordinary course of business with banks not given in connection with the issuance of Indebtedness and (ii) relating to pooled deposit or sweep accounts of any Group Member to permit satisfaction of overdraft or similar obligations incurred in the ordinary course of business of the Group;

(u)

any Lien created pursuant to the general conditions of a bank operating in The Netherlands based on the general conditions drawn up by the Netherlands Bankers' Association (Nederlandse Vereniging van Banken) and the Consumers Union (Consumentenbond) or pursuant to any other general conditions of, or any contractual arrangement with, any such bank to substantially the same effect;

(v)

Liens arising out of consignment or similar arrangements for the sale by any Group Member of goods through third parties in the ordinary course of business;

(w)

Liens on insurance policies and the proceeds thereof securing the financing of the premiums with respect thereto;



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(x)

Liens granted pursuant to the CKI Security Agreement to secure the CKI Obligations, which are senior to the Lien in favor of the Collateral Agent pursuant to the terms of the CKI Intercreditor Agreement;

(y)

Liens that are disclosed in (i) a Title Policy or (ii) any other title insurance policies delivered to the Collateral Agent in connection with mortgages on Material Real Estate Assets executed pursuant to Section 5.13 after the Closing Date  (unless the Lien described in this clause (ii) is otherwise prohibited under this Agreement and is capable of being discharged by a Loan Party in a commercially practicable manner) and any replacement, extension or renewal of any such Lien; provided, that such replacement, extension or renewal Lien shall not cover any property other than the property that was subject to such Lien prior to such replacement, extension or renewal; provided, further, that the Indebtedness and other obligations secured by such replacement, extension or renewal Lien are permitted by this Agreement;

(z)

Liens securing Attributable Indebtedness incurred under Section 6.01(k) pursuant to any Sale and Lease-Back permitted under Section 6.10;

(aa)

Liens securing obligations in respect of letters of credit, bank guarantees, warehouse receipts or similar instruments issued to support performance obligations (other than Obligations in respect of Indebtedness) and trade-related letters of credit, in each case, outstanding on the Closing Date or issued thereafter in the ordinary course of business and covering the goods (or the documents of title in respect of such goods) financed by such letters of credit, banker’s acceptances or bank guarantees and the proceeds and products thereof;

(bb)

Liens securing Indebtedness permitted by Section 6.01(r); provided that any such Liens shall only attach to the assets of the entity incurring such Indebtedness;

(cc)

Liens in favor of the U.S. Borrower or any other Loan Party; provided that if any such Lien shall cover any Collateral, the holder of such Lien shall execute and deliver to the Administrative Agent a subordination agreement in form and substance reasonably satisfactory to the Administrative Agent;

(dd)

(i) solely to the extent equal and ratable Liens are required pursuant to the terms of the 2023 Debentures Indenture, Liens securing the 2023 Debentures Obligations which Liens are granted pursuant to the Loan Documents, the CKI Security Agreement or any other security agreement the terms of which are no more favorable to the holders of the 2023 Debentures Obligations than the terms of the U.S. Pledge and Security Agreement and (ii) Liens securing any Permitted Refinancing of the 2023 Debentures Obligations, which Liens are granted pursuant to the Loan Documents, the CKI Security Agreement or any other security agreement the terms of which are no more favorable to the holders of the 2023 Debentures Obligations than the terms of the U.S. Pledge and Security Agreement; it being agreed that in the case of clauses (i) and (ii), with respect to such Loan Documents or other security agreements contemplated by such clauses entered into after the date hereof, the Administrative Agent and the Collateral Agent shall enter into intercreditor agreements as may be reasonably requested by the Borrower Representative and acceptable to the Administrative Agent and the Collateral Agent to give effect to the requirements of clause (i) or (ii) above, as applicable; and   



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(ee)

other Liens securing Indebtedness or other obligations in an aggregate amount not to exceed at any one time outstanding $150,000,000; provided that if such Liens secure Indebtedness and are on assets constituting Collateral, such Liens are subordinated to the Liens securing the Obligations pursuant to intercreditor agreement(s) reasonably satisfactory to the Administrative Agent.

Section 6.03

Designation of Subsidiaries

.  Designate any Subsidiary as an Unrestricted Subsidiary or any Unrestricted Subsidiary as a Restricted Subsidiary, except that the U.S. Borrower may at any time designate any Subsidiary as an Unrestricted Subsidiary or any Unrestricted Subsidiary as a Restricted Subsidiary; provided that:

(a)

immediately after such designation, no Default or Event of Default shall have occurred and be continuing or shall be caused thereby and the Group shall be in compliance with the financial covenants set forth in Section 6.07(a) and (b) on a pro forma basis;

(b)

with respect to any Subsidiary to be designated as an Unrestricted Subsidiary, such Subsidiary or any of its Subsidiaries does not own any Equity Interests or Indebtedness of or have any Investment in, or own or hold any Lien on any property of, any other Subsidiary of the U.S. Borrower which is not a Subsidiary of the Subsidiary to be so designated or otherwise an Unrestricted Subsidiary,

(c)

such Subsidiary is not party to any agreement, contract, arrangement or understanding with any Borrower or any Restricted Subsidiary unless the terms of any such agreement, contract, arrangement or understanding are no less favorable to such Borrower or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of the Borrowers;

(d)

such Subsidiary is a Person with respect to which neither any Borrower nor any Restricted Subsidiaries has any direct or indirect obligation (1) to subscribe for additional Equity Interests or (2) to maintain or preserve such Person’s financial condition or to cause such Person to achieve any specified levels of operating results;

(e)

such Subsidiary has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of any Borrower or any Restricted Subsidiaries;

(f)

neither any Borrower nor any Restricted Subsidiary will at any time (i) provide a guarantee of, or similar credit support to, any Indebtedness of such Subsidiary (including any undertaking, agreement or instrument evidencing such Indebtedness), (ii) be directly or indirectly liable for any Indebtedness of such Subsidiary or (iii) be directly or indirectly liable for any other Indebtedness which provides that the holder thereof may (upon notice, lapse of time or both) declare a default thereon (or cause the payment thereof to be accelerated or payable prior to its final scheduled maturity) upon the occurrence of a default with respect to any other Indebtedness that is Indebtedness of such Subsidiary (including any corresponding right to take enforcement action against such Subsidiary);

(g)

no Restricted Subsidiary may be designated as an Unrestricted Subsidiary if it was previously designated as an Unrestricted Subsidiary;



149






(h)

at no time shall any Subsidiary be designated as an Unrestricted Subsidiary or maintained as an Unrestricted Subsidiary more than ten (10) Business Days after the time of delivery of the quarterly financial statements pursuant to Section 5.01(a) if (x) the Consolidated Adjusted EBITDA attributable to such Subsidiary, calculated on an unconsolidated basis, exceeds 5.0% of Consolidated Adjusted EBITDA or (y) the total assets of such Subsidiary, determined in accordance with GAAP and calculated on an unconsolidated basis, exceeds 5.0% of Consolidated Total Assets; and

(i)

any designation of a Restricted Subsidiary to an Unrestricted Subsidiary shall be deemed an Investment under Section 6.06 in an amount equal to the fair market value of the Subsidiary so designated.

(j)

Any such designation shall be evidenced by providing notice to the Administrative Agent of the copy of the resolution of the U.S. Borrower's Board or Directors (or duly authorized committee thereof) giving effect to such designation and a certificate of an Authorized Officer certifying that such designation complies with the foregoing requirements.  Any designation of an Unrestricted Subsidiary as a Restricted Subsidiary solely as a result of the application of Section 6.03(h), for purposes of determining compliance with Article VI, shall be treated as a Permitted Acquisition (without any requirement to satisfy the definition thereof and without utilizing any portion of the amount specified in the proviso to Section 6.08(i)), and all Indebtedness, Liens, Investments and any consensual encumbrance or restriction of the type described in Section 6.05 of such Unrestricted Subsidiary shall be treated as Indebtedness, Liens, Investments and consensual encumbrances and restrictions of the type described in Section 6.05 of an entity acquired in a Permitted Acquisition. For the avoidance of doubt, such designation shall not reduce the Group’s ability to consummate Permitted Acquisitions.

Section 6.04

Restricted Payments

.  Directly or indirectly declare, order, pay, make or set apart any sum for any Restricted Payment except that:

(a)

any Subsidiary of any Borrower may declare and pay dividends, repurchase its Equity Interests, or make other distributions to each direct owner of Equity Interests of such Subsidiary; provided that, in the case of a Subsidiary that is a not a Wholly-Owned Restricted Subsidiary, such dividends, repurchases or other distributions are made to all owners of such Subsidiary’s Equity Interests on a pro rata basis (or more favorable basis from the perspective of the Group Members) based on their relative ownership interests;

(b)

the U.S. Borrower may make regularly scheduled payments of principal and interest in respect of the 2020 Notes and any Subordinated Indebtedness in accordance with the terms of and only to the extent required by the 2020 Notes Documents or the documentation governing such Subordinated Indebtedness, as applicable, and the 2020 Notes and any Subordinated Indebtedness may be refinanced pursuant to a Permitted Refinancing thereof;

(c)

the U.S. Borrower may purchase, repurchase, retire, redeem or otherwise acquire its common stock or common stock options from present or former officers, directors or employees of the Group in connection with any management equity subscription agreement, any compensation, retirement, disability, severance or benefit plan or agreement, any employment agreement or any other similar plans or agreements, provided, that the aggregate amount of



150






payments under this paragraph (net of any proceeds received by the U.S. Borrower subsequent to the Closing Date in connection with resales of any common stock or common stock options so purchased or acquired) shall not exceed $15,000,000 in any calendar year;

(d)

so long as no Default or Event of Default shall have occurred and be continuing or shall be caused thereby, the U.S. Borrower may declare and pay cash dividends with respect to (i) its common stock in an annual amount not to exceed $0.20 per outstanding share of common stock and (ii) its Series A Preferred Stock in an annual amount of up to $0.20 per share of common stock that would be issuable upon conversion of any outstanding share of Series A Preferred Stock (subject, in the case of each of clause (i) and (ii), to adjustment for any stock split, reverse stock split, stock dividend or similar occurrence so that the aggregate amount of dividends payable after such transaction is the same as the amount payable immediately prior to such transaction);

(e)

the U.S. Borrower may pay any dividend or distribution within 60 days after the date of declaration thereof, if at the date of declaration such payment would have complied with the provisions of this Agreement (including the other provisions of this Section 6.04);

(f)

the U.S. Borrower may make Restricted Payments in respect of the 2020 Notes and Subordinated Indebtedness; provided that (i) the amount of such Restricted Payments pursuant to this clause (f) does not exceed (x) $50,000,0000 during the term of this Agreement (or, if the Incurrence Test is satisfied on a pro forma basis, 1.0% of Consolidated Total Assets, if greater) plus (y) if the Incurrence Test is satisfied on a pro forma basis, an amount equal to the Available Amount, (ii) such Restricted Payments are made from proceeds from the substantially concurrent issuance, sale or exchange by the U.S. Borrower of Equity Interests, or (iii) such Restricted Payment results from the conversion of all or any portion of the 2020 Notes or Subordinated Indebtedness, as applicable, to Equity Interests of the U.S. Borrower;

(g)

so long as no Default or Event of Default shall have occurred and be continuing or shall be caused thereby, other Restricted Payments in an aggregate amount not to exceed (i) $100,000,000 (or, if the Incurrence Test is satisfied on a pro forma basis, 1.75% of Consolidated Total Assets, if greater) during the term of this Agreement plus (ii) if the Incurrence Test is satisfied on a pro forma basis, an amount equal to the Available Amount, provided that after giving effect to the consummation of such Restricted Payment and any financing thereof, the Group shall be in compliance with the financial covenants set forth in Sections 6.07(a) and (b); and

(h)

any Group Member may make Restricted Payments in respect of the Itochu Obligations; and

(i)

the U.S. Borrower may make repurchases of Equity Interests deemed to occur upon exercise of options, warrants, restricted stock units or similar rights if such Equity Interests represents all or a portion of the exercise price thereof or deemed to occur in connection with the satisfaction of any withholding tax obligation incurred relating to the vesting or exercise of such options, warrants, restricted stock units or similar rights.



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Section 6.05

Restrictions on Subsidiary Distributions; No Further Negative Pledges

.  Except as arising under any Loan Document, create or otherwise cause or suffer to exist or become effective any consensual encumbrance or restriction of any kind on the ability of any Restricted Subsidiary of any Borrower to (a) pay dividends or make any other distributions on any of such Subsidiary’s Equity Interests owned by such Borrower or any other Restricted Subsidiary of any Borrower, (b) repay or prepay any Indebtedness owed by such Restricted Subsidiary to any Borrower or any other Restricted Subsidiary of any Borrower, (c) make loans or advances to any Borrower or any other Restricted Subsidiary of any Borrower, (d) transfer, lease or license any of its property or assets to any Borrower or any other Restricted Subsidiary of any Borrower or (e) create or assume any Lien upon any of its properties or assets, whether now owned or hereafter acquired, to secure the Obligations, other than encumbrances and restrictions (i) in agreements evidencing Indebtedness permitted by Section 6.01 and agreements relating to Liens permitted by Section 6.02 that impose restrictions on the property subject to such Liens, (ii) by reason of customary provisions restricting assignments, subletting or other transfers contained in leases, licenses, joint venture agreements and agreements similar to any of the foregoing (provided that such restrictions are limited to the assets or property subject to such leases, licenses, joint venture or similar agreements), (iii) created by virtue of any sale, transfer, lease or other disposition of, or any agreement with respect thereto, any specific property, assets or Equity Interests permitted to be so transferred under this Agreement, (iv) contained in the 2023 Debentures Indenture, the CKI Documents, the Itochu Agreement, and any agreement related to the China JV Obligations, (v) with respect to any Restricted Subsidiary organized under the laws of Japan, imposed pursuant to an agreement restricting (A) the creation or assumption of any Lien upon such Restricted Subsidiary’s inventory and receivables or (B) the transfer of assets of any such Restricted Subsidiary, in each case in the ordinary course of business, (vi) existing under or by reason of applicable law, rule or regulation, (vii) on the use of cash or other deposits imposed by customers under contracts entered into in the ordinary course of business, (viii) in any agreement in effect at the time a Person becomes a Subsidiary of the U.S. Borrower, provided that the agreement in which such restrictions are contained was not entered into in contemplation of such Person becoming a Subsidiary of the U.S. Borrower, (ix) contained in agreements in effect on the Closing Date and described in Schedule 6.05 and (x) in any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings of the contracts, instruments or obligations referred to in clauses (i) through (ix) above; provided that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings are, in the good faith judgment of the U.S. Borrower, no more restrictive with respect to the restrictions referred to in clauses (a) through (e) above than prior to such amendment, modification, restatement, renewal, increase, supplement, refunding, replacement or refinancing.

Section 6.06

Investments

.  Make or own any Investment in any Person, including any Joint Venture, except:

(a)

Investments in cash and Cash Equivalents and Investments that were Cash Equivalents when made;

(b)

Investments owned as of the Closing Date in any Restricted Subsidiary and Investments made after the Closing Date in any Loan Party;



152






(c)

deposits, prepayments, advances in the form of a prepayment of expenses and other credits to suppliers made in the ordinary course of business consistent with the past practices of the Group;

(d)

Investments to the extent that payment for such Investments is made with Equity Interests of the U.S. Borrower;

(e)

Investments that are acquired by any Group Member as a result of a Permitted Acquisition; provided that such Investments existed at the time of the Permitted Acquisition and were not made in contemplation thereof;

(f)

Consolidated Capital Expenditures with respect to the Loan Parties permitted by Section 6.07(c);

(g)

loans and advances to employees, consultants or directors (managing or otherwise) of the Group made in the ordinary course of business in an aggregate principal amount at any one time outstanding not to exceed $15,000,000;

(h)

Permitted Acquisitions permitted pursuant to Section 6.08;

(i)

Investments in existence on, or pursuant to legally binding written commitments in existence on, the Closing Date as described in Schedule 6.06 and, in each case, any extensions, modifications or renewals thereof so long as the amount of any Investment made pursuant to this clause (i) is not increased at any time above the amount of such Investment existing or committed, as applicable, on the Closing Date;

(j)

Currency Agreements, Interest Rate Agreements and Treasury Transactions which constitute Investments;

(k)

accounts, chattel paper and notes receivable arising from the sale or lease of goods or the performance of services in the ordinary course of business;

(l)

Investments received in the ordinary course of business by any Group Member in connection with the bankruptcy or reorganization of suppliers and customers and in settlement of delinquent obligations of, and other disputes with, suppliers and customers arising in the ordinary course of business;

(m)

so long as no Default or Event of Default shall have occurred and be continuing or shall be caused thereby, other Investments in an aggregate amount not to exceed at any one time outstanding (i) $135,000,000 (or, if the Incurrence Test is satisfied on a pro forma basis, 2.25% of Consolidated Total Assets, if greater), plus (ii) to the extent not included in the Available Amount, 100.0% of the aggregate cash dividends and distributions received by any Group Member from such Investments, plus (iii) if the Incurrence Test is satisfied on a pro forma basis, an amount equal to the Available Amount at such time;

(n)

Investments in the China JV in an aggregate amount not to exceed at any one time outstanding (i) $50,000,000, plus, (ii) to the extent not included in the Available



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Amount, 100.0% of the aggregate cash dividends and distributions received by any Group Member from the China JV;

(o)

Investments arising out of the receipt by any Group Member of noncash consideration for the sale of assets permitted under Section 6.08;

(p)

guaranties by any Group Member of operating leases (other than obligations with respect to Capital Leases) or of other obligations, that do not constitute Indebtedness, in each case entered into by the applicable Group Member in the ordinary course of business;

(q)

guaranties permitted under Section 6.01 (except to the extent such guaranty is expressly subject to Section 6.06);

(r)

Investments made pursuant to the CKI Trust Agreement; and

(s)

Investments consisting of the redemption, purchase, repurchase or retirement of any Equity Interests permitted under Section 6.04.

Section 6.07

Financial Covenants

.  In the case of the U.S. Borrower:

(a)

Interest Coverage Ratio.  Permit the Interest Coverage Ratio as of the last day of any Fiscal Quarter, beginning with the Fiscal Quarter ending October 31, 2010, to be less than the correlative ratio indicated:   

Fiscal Quarter

Interest Coverage Ratio

FQ3 2010

3.00:1.00

FQ4 2010

3.00:1.00

FQ1 2011

3.00:1.00

FQ2 2011

3.00:1.00

FQ3 2011

3.00:1.00

FQ4 2011

3.00:1.00

FQ1 2012

3.50:1.00

FQ2 2012

3.50:1.00

FQ3 2012

3.50:1.00

FQ4 2012

3.50:1.00

FQ1 2013

3.75:1.00

FQ2 2013

3.75:1.00

FQ3 2013

3.75:1.00

FQ4 2013

3.75:1.00

FQ1 2014

4.00:1.00



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FQ2 2014

4.00:1.00

FQ3 2014

4.00:1.00

FQ4 2014

4.00:1.00

FQ1 2015 and thereafter

4.50:1.00


(b)

Leverage Ratio.  Permit the Leverage Ratio as of the last day of any Fiscal Quarter, beginning with the Fiscal Quarter ending October 31, 2010, to exceed the correlative ratio indicated:

Fiscal Quarter

Leverage Ratio

FQ3 2010

4.90:1.00

FQ4 2010

4.90:1.00

FQ1 2011

4.75:1.00

FQ2 2011

4.75:1.00

FQ3 2011

4.75:1.00

FQ4 2011

4.75:1.00

FQ1 2012

4.00:1.00

FQ2 2012

4.00:1.00

FQ3 2012

4.00:1.00

FQ4 2012

4.00:1.00

FQ1 2013

3.50:1.00

FQ2 2013

3.50:1.00

FQ3 2013

3.50:1.00

FQ4 2013

3.50:1.00

FQ1 2014

and thereafter

3.00:1.00



(c)

Maximum Consolidated Capital Expenditures.  

Make or incur Consolidated Capital Expenditures, in any Fiscal Year indicated below, in an aggregate amount for the Group in excess of the corresponding amount set forth below opposite such Fiscal Year (the Permitted Capital Expenditure Amount); provided, that such amount for any Fiscal Year shall be increased by (i) an amount equal to the excess, if any, of such amount for the



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immediately preceding Fiscal Year (with the amount of any rollover from the prior Fiscal Year being deemed to be used first) over the actual amount of Consolidated Capital Expenditures for such previous Fiscal Year and (ii) to the extent that a Permitted Acquisition is consummated during or prior to such Fiscal Year (but after the Closing Date), an amount equal to 5% of the Acquisition Consideration paid with respect to such Permitted Acquisition (the “Acquired Permitted CapEx Amount”) (provided, however, that with respect to the Fiscal Year during which any such Permitted Acquisition occurs, the amount of additional Consolidated Capital Expenditures permitted as a result of this clause (ii) shall be an amount equal to the product of (x) the Acquired Permitted CapEx Amount and (y) a fraction, the numerator of which is the number of days remaining in such Fiscal Year after the date such Permitted Acquisition is consummated and the denominator of which is the actual number of days in such Fiscal Year):

Fiscal Year

Consolidated Capital Expenditures

2010

$215,000,000

2011

$220,000,000

2012

$210,000,000

2013

$240,000,000

2014

$250,000,000

2015

$270,000,000

2016

$280,000,000


Notwithstanding the foregoing, for purposes of determining compliance with this Section 6.07(c) for any given Fiscal Year, the actual amount of Consolidated Capital Expenditures that are made or incurred in such Fiscal Year and that are denominated in any currency other than Dollars will be converted into Dollars based on the relevant currency exchange rate in effect on the Closing Date.

Section 6.08

Fundamental Changes; Disposition of Assets; Acquisitions

.  Enter into any transaction of merger or consolidation, or liquidate, wind-up or dissolve itself (or suffer any liquidation or dissolution) or convey, sell, lease or license, exchange, transfer or otherwise dispose of, in one transaction or a series of transactions, all or any part of its business, assets or property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible, whether now owned or hereafter acquired, leased or licensed, or acquire by purchase or otherwise (other than purchases or other acquisitions of inventory, materials and equipment and Consolidated Capital Expenditures in the ordinary course of business) all or substantially all of the assets of, all of the Equity Interests of, or a business line or unit or a division of, any Person, except:

(a)

(i) any Group Member may be merged or consolidated with or into any other Group Member, or be liquidated, wound up or dissolved, or all or any part of its business, assets or property may be conveyed, sold, leased, transferred or otherwise disposed of, in one transaction or a series of transactions, to any other Group Member; provided, that (x) in the case



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of a merger or consolidation of a Group Member that is not a Loan Party with or into a Borrower or Guarantor, such Borrower or such Guarantor, as applicable, shall be the continuing or surviving Person, (y) in the case of a merger or consolidation of a Guarantor with or into another Guarantor, a Guarantor shall be the continuing or surviving Person and (z) in the case of a merger or consolidation of a Guarantor with or into a Borrower, such Borrower shall be the continuing or surviving Person, and (ii) any Restricted Subsidiary may merge with any other person in order to effect an Investment permitted pursuant to Section 6.06 so long as the continuing or surviving person shall be a Restricted Subsidiary, which shall be a Loan Party if the merging Restricted Subsidiary was a Loan Party and which together with each of its Restricted Subsidiaries shall have complied with the requirements of Section 5.12, 5.13 and 5.14, as applicable and if such transaction involves the U.S. Borrower, the U.S. Borrower shall be the continuing or surviving Person;

(b)

any Group Member (other than the U.S. Borrower in the case of a disposition of all of its assets) may dispose of any or all of its assets (upon voluntary liquidation or otherwise) to a Borrower or any other Loan Party, and any Group Member that is not a Loan Party may dispose of any or all of its assets (upon voluntary liquidation or otherwise) to another Group Member that is not a Loan Party;

(c)

sales or other dispositions of assets that do not constitute Asset Sales;

(d)

(i) Asset Sales, the proceeds of which (valued at the principal amount thereof in the case of non-cash proceeds consisting of notes or other debt Securities and valued at fair market value in the case of other non-cash proceeds) when aggregated with the proceeds of all other Asset Sales made pursuant to this clause (d)(i) in any Fiscal Year, are less than (x) 2.0% of Consolidated Total Assets plus (y) an amount equal to any unutilized portion of the amount permitted under subclause (x) for any preceding Fiscal Year; provided that in no event shall the proceeds of any Asset Sale, when aggregated with the proceeds of all other Asset Sales made pursuant to this clause (d)(i) in any Fiscal Year, exceed 5.0% of Consolidated Total Assets; and (ii) the Asset Sale described on Schedule 6.08(d); provided that, in the case of each of clause (i) and (ii), (1) the consideration received for such assets shall be in an amount at least equal to the fair market value thereof (determined in good faith by the Board of Directors of the U.S. Borrower (or a duly authorized committee thereof)), (2) except in the case of any Asset Sale to any Restricted Subsidiary, no less than 75.0% thereof shall be paid in cash or Cash Equivalents, and (3) except in the case of any Asset Sale to any Restricted Subsidiary, the Net Cash Proceeds thereof shall be applied as required by Section 2.14(a);

(e)

any Group Member may sell or discount, in each case without recourse and in the ordinary course of business, accounts receivable arising in the ordinary course of business (x) which are overdue, or (y) which such Group Member may reasonably determine are difficult to collect but only in connection with the compromise or collection thereof consistent with prudent business practice (and not as part of any bulk sale or financing of receivables);

(f)

any Group Member may enter into licenses or sublicenses of Software,
Trademarks and other Intellectual Property and general intangibles in the ordinary course of business and which do not materially interfere with the business of the Group Members taken as a whole;



157






(g)

(i) any disposition of Securitization Assets to a Securitization Subsidiary in connection with a Qualified Securitization Financing and (ii) any disposition of accounts receivable in connection with receivables factoring arrangements in the ordinary course of business;

(h)

dispositions of cash and Cash Equivalents;

(i)

Permitted Acquisitions; provided, that in respect of acquisitions of Persons which do not become Loan Parties or of assets which are not acquired by Loan Parties, the consideration for such Persons or assets shall not exceed an aggregate amount of 5.0% of Consolidated Total Assets over the term of this Agreement; and

(j)

(i) Permitted Sale and Lease-Backs and (ii) Sale and Lease-Backs otherwise permitted by Section 6.10(ii), provided that the Net Cash Proceeds of Sale and Lease-Backs (other than Permitted Sale and Lease-Backs) shall be applied as required by Section 2.14(a); provided, further, that, the case of clause (ii), the net proceeds received by the applicable Group Member are at least equal to the fair market value of such asset or Investment (as determined by the U.S. Borrower’s Board of Directors (or a duly authorized committee thereof));

(k)

sales or other dispositions of the Equity Interests of, or other ownership interests in or assets or property, including Indebtedness, or other securities of, any Joint Venture (including the China JV); provided that, in each case, the net proceeds received by the applicable Group Member are at least equal to the fair market value of such asset or Investment (as determined by the U.S. Borrower’s Board of Directors (or a duly authorized committee thereof);

(l)

any lease, assignment or sublease in the ordinary course of business which does not materially interfere with the business of the Group Members taken as a whole; and

(m)

Investments made in accordance with Section 6.06 and Restricted Payments made in accordance with Section 6.04.

Section 6.09

Disposal of Subsidiary Interests

.  Except for any sale of all of its interests in the Equity Interests of any of its Subsidiaries in compliance with the provisions of Section 6.08, or any transfer to a Group Member otherwise permitted under Section 6.08, (a) sell, assign, or otherwise dispose of any Equity Interests of any of its Restricted Subsidiaries, except to qualify directors if required by applicable law; or (b) permit any of its Restricted Subsidiaries to sell, assign, or otherwise dispose of any Equity Interests of any of its Restricted Subsidiaries, except to qualify directors if required by applicable law.

Section 6.10

Sales and Lease-Backs

.  Become or remain liable as lessee or as a guarantor or other surety with respect to any lease of any property (whether real, personal or mixed), whether now owned or hereafter acquired, which such Loan Party (a) has sold or transferred or is to sell or to transfer to any other Person (other than to any Group Member), (b) intends to use for substantially the same purpose as any other property which has been or is to be sold or transferred by such Loan Party to any Person (other than to any Group Member) in connection with such lease or (c) is to be sold or transferred by such Loan Party to such Person or to any other Person to whom funds have been or are to be advanced by such Person on the security of such property or rental obligations of such Loan Party (a “Sale and Lease-Back”),



158






excluding (i) any such arrangement to the extent that any Attributable Indebtedness incurred in connection therewith does not exceed $35,000,000 (such transaction, a “Permitted Sale and Lease-Back”) and (ii) any other Sale and Lease-Back so long as such Group Member would be entitled to incur the Attributable Indebtedness with respect to such Sale and Lease-Back under Section 6.01, create a Lien on the property securing such Attributable Indebtedness under Section 6.02 and the proceeds of such transaction are applied in accordance with Section 2.14(a).

Section 6.11

Transactions with Shareholders and Affiliates

. Enter into or permit to exist any transaction (including the purchase, sale, lease or exchange of any property, the rendering of any service or the payment of any management, advisory or similar fees) with any Affiliate of any Group Member on terms that are less favorable to such Group Member than those that might be obtained in a comparable arm’s length transaction at the time from a Person who is not such a holder or Affiliate; provided, that the foregoing restriction shall not apply to (a) any transaction between or among any Group Members; (b) reasonable and customary fees and indemnities paid to directors, officers and employees of any Group Member and compensation arrangements for directors, officers and other employees of any Group Member entered into in the ordinary course of business; (c) any issuance of securities, or other payments, awards or grants in cash, securities or otherwise pursuant to, or the funding of, employment arrangements, stock options and stock ownership plans in the ordinary course of business; (d) (x) any employment agreements entered into by any Group Member in the ordinary course of business and any transaction pursuant thereto and (y) any employee compensation, benefit plan or arrangement, any health, disability or similar insurance plan which covers employees, and any reasonable employment contract and transaction pursuant thereto; (e) any Restricted Payment permitted by Section 6.04; (f) any Investment permitted under Section 6.06; (g) any transactions pursuant to agreements in existence on the Closing Date and set forth  in Schedule 6.11 and any amendment thereto to the extent such amendment is not adverse to the Lenders in any material respect, (h) any transactions between any Group Member and the China JV or any of its Affiliates; (i) any transaction between any Group Member and Apax Partners L.P. or any of its Affiliates; (j) any transaction with a Joint Venture for the purchase or sale of goods, equipment and services entered into in the ordinary course of business and in a manner consistent with past practice, (k) any transaction entered into by a Person prior to the time such Person becomes a Group Member or is merged or consolidated into a Group Member (provided such transaction is not entered into in contemplation of such event); (l) any transactions between any Group Member and Pepe Jeans SL (or any successor or replacement sales and collection agent and franchisee in Spain and Portugal); (m) any transaction between a Group Member and a Securitization Subsidiary pursuant to a Qualified Securitization Financing; (n) any satisfaction or discharge of the Itochu Obligations; (o) any transactions between any Group Member and ITOCHU Corporation or any Joint Venture of any Group Member, in each case in the ordinary course of business; (p) any transactions between any Group Member and the CKI Trust pursuant to the CKI Trust Agreement; and (q) cost sharing arrangements deemed appropriate by the U.S. Borrower to allocate properly the costs of future maintenance and development of Intellectual Property of any Group Member.

Section 6.12

Conduct of Business

.  From and after the Closing Date, engage in any business (either directly or through a Restricted Subsidiary) other than the businesses engaged in by the Group Members on the Closing Date or any extension of such



159






businesses consistent with industry developments and any business ancillary, complementary or related thereto.

Section 6.13

Amendments or Waivers of Organizational Documents and Certain Other Documents

.  Agree to (a) any material amendment, restatement, supplement or other modification to or waiver of any of its Organizational Documents which would be materially adverse to the interests of the Lenders, taken as a whole, (b) any amendment, restatement, supplement or other modification to or waiver (other than any such amendment, restatement, supplement or other modification or waiver as may be required pursuant to the CK Letter Agreement as in effect on the Closing Date) (i) of Section 4.17(c)(iv) or Section 4.18 of the CKI Security Agreement (or any definition in the CKI Security Agreement that would have the effect of amending, supplementing or otherwise modifying such Sections or the effect or existence of a CKI Blockage Event), in each case that would be materially adverse to the interests of the U.S. Borrower and its Subsidiaries, taken as a whole, or (ii) of any provision of any CKI Document that has the effect of (w) requiring any Person to become a CK Grantor (as defined in the CKI Intercreditor Agreement as of the date hereof) that would not be required to become a CK Grantor in accordance with the terms of the First Lien Collateral Documents (as defined in the CKI Intercreditor Agreement as of the date hereof), (x) adding additional CK Collateral (as defined in the CKI Intercreditor Agreement as of the date hereof) that would not be required to become CK Collateral (as defined in the CKI Intercreditor Agreement as of the date hereof) pursuant to the terms of the First Lien Collateral Documents (as defined in the CKI Intercreditor Agreement as of the date hereof), (y) increasing the amount of, or adjusting the calculation of, the Klein Obligations (as defined in the CKI Intercreditor Agreement as of the date hereof) in any manner unless such adjustment could only decrease the amount of the Klein Obligations as of such date (it being understood that this Section 6.13 shall not prohibit the making of any one-time consent payment by any Group Member in respect of any amendment, restatement, supplement or other modification or waiver to any CKI Documents) or (z) decreasing the amount of the Maximum Second Lien Amount (as defined in the CKI Intercreditor Agreement as of the date hereof), or (c) any amendment, restatement, supplement, waiver or other modification of the terms of the 2020 Notes which would be materially adverse to the Lenders.

Section 6.14

Fiscal Year

.  Change its Fiscal Year-end from the Sunday closest to February 1 of each calendar year or change its method of determining Fiscal Quarters; provided that the Loan Parties may, at any time prior to the end of FQ4 2011, change their Fiscal Year-end upon prior notice to the Administrative Agent; provided, further, that (i) the U.S. Borrower will provide to the Administrative Agent such audited financials as are required to be submitted to the SEC and at the times required thereby, (ii) such change in Fiscal Year end shall not relieve the U.S. Borrower from its obligation to provide to the Lenders comparative figures to the corresponding periods from the prior Fiscal Year or to the Financial Plan previously provided to the Lenders for such Fiscal Year and (iii) notwithstanding any change in Fiscal Year end, the U.S. Borrower will make a payment on or prior to April 30, 2011 pursuant to Section 2.14(d), calculated as if no change in Fiscal Year had occurred, and, without duplication of any amounts already paid with respect to such period, an additional payment pursuant to Section 2.14(d) payable at the time the audited financial statements are delivered for the transition period as set forth in clause (i) of this Section (it being understood and agreed that subsequent to such payment (or in the event that no such financial statements are required to be delivered), further



160






payments pursuant to Section 2.14(d) will occur with the delivery of annual financial statements).

Section 6.15

Centre of Main Interests and Establishments

.  No Loan Party whose jurisdiction is in a member state of the European Union shall deliberately change its “centre of main interest” (as that term is used in the Regulation) in a manner that would reasonably be expected to result in a Material Adverse Effect.  

Section 6.16

Limitation in Relation to German Loan Parties

.  

(a)

The provisions of Sections 6.02, 6.03, 6.04, 6.05, 6.08, 6.11, 6.12 and 6.13 (the “Relevant Restrictive Covenants”) shall not apply to any German Loan Party or any of its Subsidiaries from time to time which is incorporated in Germany (a “German Group Member”).

(b)

With respect to any transactions not permitted under the Relevant Restrictive Covenants (ignoring for this purpose clause (a) above), each German Loan Party shall give the Administrative Agent notice in writing and in good time of the intention of it or of any German Group Member to carry out any of the acts or take any of the steps referred to in the Relevant Restrictive Covenant, explaining if and how such steps might affect the financial situation of the company or the Group, or the Lenders’ risk and security position. Any such notification shall not be made later than twenty (20) Business Days before such measure shall be implemented, or in case of urgent matters requiring an implementation on shorter notice immediately after the need for the relevant measure arises, provided that, the reasons for such urgent implementation are described in the notification.

(c)

The Administrative Agent shall be entitled within ten (10) Business Days of receipt of the relevant German Loan Party’s notice under clause (b) above to request the relevant German Loan Party to supply to the Administrative Agent in sufficient copies for the Lenders any relevant information in connection with the proposed action or steps referred to in such notice.

(d)

The Administrative Agent shall notify the relevant German Loan Party, within ten (10) Business Days of receipt of the relevant German Loan Party’s notice under clause (b) above or, if additional information has been requested by the Administrative Agent under clause (c) above, within ten (10) Business Days of receipt of such information, whether the proposed action or steps under clause (b) above is, or is in the reasonable opinion of the Administrative Agent (acting on the instructions of the Required Lenders), likely to have a Material Adverse Effect or a material adverse consequences for the Lenders’ risk or security position.

(e)

If the proposed action or steps under clause (b) above is considered by the Administrative Agent (acting reasonably and in accordance with clause (d) above) to have a Material Adverse Effect or a material adverse consequences for the Lenders’ risk or security position and the relevant German Loan Party or German Group Member nevertheless takes such action or steps, this shall constitute an Event of Default pursuant



161






to clause (m) of Section 8.01 and the Administrative Agent shall consequently be entitled to take (and, if so instructed by the Required Lenders, shall take) any of the steps set out in Section 8.01.

Section 6.17

UK Defined Benefit Pension Plan

.  Within the meaning of the UK Pensions Act 2004: (a) Become the employer in relation to a UK defined benefit pension plan irrespective of the funded status of such pension plan, or (b) become connected or associated with the employer in relation to a UK defined benefit pension plan if, at the time of connection or association, the liabilities of such pension plan, as calculated using the actuarial methods and assumptions used for funding as set forth on the most recent actuarial report for such pension plan, exceed the fair market value of the assets of such plan by more than $50 million.

Section 6.18

Financial Assistance

.  Each Loan Party shall comply, where applicable, in all respects with any financial assistance legislation in any Relevant Jurisdiction, including as related to execution of the Security Documents and payment of amounts due under this Agreement.  

ARTICLE VII.
GUARANTY

Section 7.01

Guaranty of the Obligations

.  

(a)

Subject to the provisions of Section 7.02, each U.S. Guarantor jointly and severally hereby irrevocably and unconditionally guaranties to the Administrative Agent for the ratable benefit of the Secured Parties the due and punctual payment in full of all Obligations of the Borrowers (or, in the case of the U.S. Borrower, all Obligations of the Foreign Borrower) when the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a) or any comparable provision of any other Debtor Relief Law) (the “U.S. Guaranteed Obligations”).

(b)

Subject to the provisions of Sections 7.02, 7.13 and 7.14, each Foreign Guarantor, jointly and severally hereby irrevocably and unconditionally guaranties to the Administrative Agent for the ratable benefit of the Secured Parties the due and punctual payment in full of all Obligations of the Foreign Borrower on demand when the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a)) (the “Foreign Guaranteed Obligations” and, together with the U.S. Guaranteed Obligations, the Guaranteed Obligations”).

Section 7.02

Limitation on Liability; Contribution by Guarantors

.  

(a)

Notwithstanding the foregoing, each Guarantor, and by acceptance of the benefits hereof, the Administrative Agent and each other Secured Party hereby confirms that it is the intention of all such Persons that each Guaranty and the Guaranteed Obligations of each Guarantor hereunder not constitute a fraudulent conveyance for purposes of the Bankruptcy



162






Code or any other federal, state or foreign bankruptcy, insolvency, receivership or similar law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar foreign, federal or state law to the extent applicable to each Guaranty and the Guaranteed Obligations of each Guarantor hereunder.  To effectuate the foregoing intention, the Administrative Agent and the Secured Parties hereby irrevocably agree that the Guaranteed Obligations of each Guarantor hereunder at any time shall be limited to the maximum amount as will result in the Guaranteed Obligations of such Guarantor hereunder not constituting a fraudulent transfer or conveyance.

(b)

The U.S. Guarantors (the “U.S. Contributing Guarantors”) and Foreign Guarantors (the “Foreign Contributing Guarantors,” and collectively with the U.S. Contributing Guarantors, the “Contributing Guarantors”) desire to allocate among themselves, in a fair and equitable manner, the U.S. Guaranteed Obligations and Foreign Guaranteed Obligations, respectively, arising under this Guaranty; provided that nothing in this Section 7.02 shall operate or be construed to allocate to any Foreign Contributing Guarantor any Obligation of the U.S. Borrower or to permit any payment by a Foreign Guarantor to reduce any Obligations of the U.S. Borrower.  Accordingly, in the event any payment or distribution is made on any date by a Guarantor (a “Funding Guarantor”) under this Guaranty such that its Aggregate Payments exceed its Fair Share as of such date, such Funding Guarantor shall be entitled to a contribution from each of the other applicable Contributing Guarantors in an amount sufficient to cause each such Contributing Guarantor’s Aggregate Payments to equal its Fair Share as of such date.  “Fair Share” means, with respect to a Contributing Guarantor as of any date of determination, an amount equal to (a) the ratio of (i) the Fair Share Contribution Amount with respect to such Contributing Guarantor to (ii) the aggregate of the Fair Share Contribution Amounts with respect to all Contributing Guarantors multiplied by (b) the aggregate amount paid or distributed on or before such date by all Funding Guarantors under this Guaranty in respect of the U.S. Guaranteed Obligations or Foreign Guaranteed Obligations, as applicable.  “Fair Share Contribution Amount” means, with respect to a Contributing Guarantor as of any date of determination, the maximum aggregate amount of the obligations of such Contributing Guarantor under this Guaranty that would not render its obligations hereunder or thereunder subject to avoidance as a fraudulent transfer or conveyance under Section 548 of Title 11 of the United States Code or any comparable applicable provisions of any Debtor Relief Law; provided, that solely for purposes of calculating the Fair Share Contribution Amount with respect to any Contributing Guarantor for purposes of this Section 7.02, any assets or liabilities of such Contributing Guarantor arising by virtue of any rights to subrogation, reimbursement or indemnification or any rights to or obligations of contribution hereunder shall not be considered as assets or liabilities of such Contributing Guarantor. “Aggregate Payments” means, with respect to a Contributing Guarantor as of any date of determination, an amount equal to (1) the aggregate amount of all payments and distributions made on or before such date by such Contributing Guarantor in respect of this Guaranty (including in respect of this Section 7.02), minus (2) the aggregate amount of all payments received on or before such date by such Contributing Guarantor from the other applicable Contributing Guarantors as contributions under this Section 7.02.  The amounts payable as contributions hereunder shall be determined as of the date on which the related payment or distribution is made by the applicable Funding Guarantor.  The allocation among the applicable Contributing Guarantors of their obligations as set forth in this Section 7.02 shall not be construed in any way to limit the liability of any Contributing



163






Guarantor hereunder.  Each Guarantor is a third party beneficiary to the contribution agreement set forth in this Section 7.02.

Section 7.03

Payment by Guarantors

.  

(a)

Subject to Sections 7.02, 7.13 and 7.14, the U.S. Guarantors hereby jointly and severally agree, in furtherance of the foregoing and not in limitation of any other right which any Secured Party may have at law or in equity against any U.S. Guarantor by virtue hereof, that upon the failure of any Borrower to pay any of the U.S. Guaranteed Obligations when and as the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a) or any comparable provision of any other Debtor Relief Law), the U.S. Guarantors shall upon demand pay, or cause to be paid, in cash, to the Administrative Agent for the ratable benefit of the Secured Parties, an amount equal to the sum of the unpaid principal amount of all U.S. Guaranteed Obligations then due as aforesaid, accrued and unpaid interest on such U.S. Guaranteed Obligations (including interest which, but for any Borrower’s becoming the subject of a case under the Bankruptcy Code or any other Debtor Relief Law, would have accrued on such U.S. Guaranteed Obligations, whether or not a claim is allowed against such Borrower for such interest in the related bankruptcy case or analogous proceeding under any Debtor Relief Law) and all other U.S. Guaranteed Obligations then owed to the Secured Parties as aforesaid.

(b)

Subject to Sections 7.02, 7.13 and 7.14, the Foreign Guarantors hereby jointly and severally agree, in furtherance of the foregoing and not in limitation of any other right which any Secured Party may have at law or in equity against any Foreign Guarantor by virtue hereof, that upon the failure of the Foreign Borrower to pay any of the Foreign Guaranteed Obligations when and as the same shall become due, whether at stated maturity, by required prepayment, declaration, acceleration, demand or otherwise (including amounts that would become due but for the operation of the automatic stay under Section 362(a) of the Bankruptcy Code, 11 U.S.C. § 362(a) or any comparable provision of any other Debtor Relief Law), the Foreign Guarantors shall upon demand pay, or cause to be paid, in cash, to the Administrative Agent for the ratable benefit of the Secured Parties, an amount equal to the sum of the unpaid principal amount of all Foreign Guaranteed Obligations then due as aforesaid, accrued and unpaid interest on such Foreign Guaranteed Obligations (including interest which, but for the Foreign Borrower’s becoming the subject of a case under the Bankruptcy Code or any other Debtor Relief Law, would have accrued on such Foreign Guaranteed Obligations, whether or not a claim is allowed against the Foreign Borrower for such interest in the related bankruptcy case or analogous proceeding under any Debtor Relief Law) and all other Foreign Guaranteed Obligations then owed to the Secured Parties as aforesaid.

Section 7.04

Liability of Guarantors Absolute

.  Each Guarantor agrees that, to the maximum extent permitted by applicable law, its obligations hereunder are irrevocable, absolute, independent and unconditional and shall not be affected by any circumstance which constitutes a legal or equitable discharge of a Guarantor or surety other than Payment in Full of the applicable Guaranteed Obligations.  In furtherance of the foregoing and without limiting the generality thereof, each Guarantor agrees, to the maximum extent permitted by applicable law, as follows:



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(a)

this Guaranty is a guaranty of payment when due and not of collectability.  This Guaranty is a primary obligation of each Guarantor and not merely a contract of surety;

(b)

the Administrative Agent may enforce this Guaranty upon the occurrence of an Event of Default notwithstanding the existence of any dispute between any Borrower and any Secured Party with respect to the existence of such Event of Default;

(c)

the obligations of each Guarantor hereunder are independent of the obligations of each Borrower and the obligations of any other Guarantor (including any other Guarantor) of the obligations of each Borrower, and a separate action or actions may be brought and prosecuted against such Guarantor whether or not any action is brought against such Borrower or any of such other Guarantors and whether or not such Borrower is joined in any such action or actions;

(d)

payment by any Guarantor of a portion, but not all, of the applicable Guaranteed Obligations shall in no way limit, affect, modify or abridge any Guarantor’s liability for any portion of the applicable Guaranteed Obligations which has not been paid.  Without limiting the generality of the foregoing, if the Administrative Agent is awarded a judgment in any suit brought to enforce any Guarantor’s covenant to pay a portion of the applicable Guaranteed Obligations, such judgment shall not be deemed to release such Guarantor from its covenant to pay the portion of the applicable Guaranteed Obligations that is not the subject of such suit, and such judgment shall not, except to the extent satisfied by such Guarantor, limit, affect, modify or abridge any other Guarantor’s liability hereunder in respect of the applicable Guaranteed Obligations;

(e)

any Secured Party, upon such terms as it deems appropriate, without notice or demand and without affecting the validity or enforceability hereof or giving rise to any reduction, limitation, impairment, discharge or termination of any Guarantor’s liability hereunder, from time to time may (i) renew, extend, accelerate, increase the rate of interest on, or otherwise change the time, place, manner or terms of payment of the Guaranteed Obligations; (ii) settle, compromise, release or discharge, or accept or refuse any offer of performance with respect to, or substitutions for, the Guaranteed Obligations or any agreement relating thereto and/or subordinate the payment of the same to the payment of any other obligations; (iii) request and accept other guaranties of the Guaranteed Obligations and take and hold security for the payment hereof or the Guaranteed Obligations; (iv) release, surrender, exchange, substitute, compromise, settle, rescind, waive, alter, subordinate or modify, with or without consideration, any security for payment of the Guaranteed Obligations, any other guaranties of the Guaranteed Obligations, or any other obligation of any Person (including any other Guarantor) with respect to the Guaranteed Obligations; (v) enforce and apply any security now or hereafter held by or for the benefit of such Secured Party in respect hereof or the Guaranteed Obligations and direct the order or manner of sale thereof, or exercise any other right or remedy that such Secured Party may have against any such security, in each case as such Secured Party in its discretion may determine consistent herewith, the applicable Hedge Agreement, Cash Management Agreement or Treasury Transaction and any applicable security agreement, including foreclosure on any such security pursuant to one or more judicial or nonjudicial sales, whether or not every aspect of any such sale is commercially reasonable, and even though such action operates to impair or extinguish any right of reimbursement or subrogation or other right or remedy of any Guarantor



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against any Borrower or any security for the Guaranteed Obligations; and (vi) exercise any other rights available to it under the Loan Documents or any Hedge Agreements, Cash Management Agreements or Treasury Transactions; and

(f)

this Guaranty and the obligations of Guarantors hereunder shall be valid and enforceable and shall not be subject to any reduction, limitation, impairment, discharge or termination for any reason (other than Payment in Full of the applicable Guaranteed Obligations), including the occurrence of any of the following, whether or not any Guarantor shall have had notice or knowledge of any of them: (i) any failure or omission to assert or enforce or agreement or election not to assert or enforce, or the stay or enjoining, by order of court, by operation of law or otherwise, of the exercise or enforcement of, any claim or demand or any right, power or remedy (whether arising under the Loan Documents, any Hedge Agreements, any Cash Management Agreements or any Treasury Transactions, at law, in equity or otherwise) with respect to the Guaranteed Obligations or any agreement relating thereto, or with respect to any other guaranty of or security for the payment of the Guaranteed Obligations; (ii) any rescission, waiver, amendment or modification of, or any consent to departure from, any of the terms or provisions (including provisions relating to events of default) hereof, any of the other Loan Documents, any of the Hedge Agreements, Cash Management Agreements or Treasury Transactions or any agreement or instrument executed pursuant thereto, or of any other guaranty or security for the Guaranteed Obligations, in each case whether or not in accordance with the terms hereof or such Loan Document, such Hedge Agreement, such Cash Management Agreement, such Treasury Transaction or any agreement relating to such other guaranty or security; (iii) the Guaranteed Obligations, or any agreement relating thereto, at any time being found to be illegal, invalid or unenforceable in any respect (other than with respect to defense of payment or performance in full); (iv) the application of payments received from any source (other than payments received pursuant to the other Loan Documents, any of the Hedge Agreements, any of the Cash Management Agreements, any Treasury Transaction or from the proceeds of any security for the Guaranteed Obligations, except to the extent such security also serves as Collateral for Indebtedness other than the Guaranteed Obligations) to the payment of Indebtedness other than the Guaranteed Obligations, even though any Secured Party might have elected to apply such payment to any part or all of the Guaranteed Obligations; (v) any Secured Party’s consent to the change, reorganization or termination of the corporate structure or existence of any Group Member and to any corresponding restructuring of the Guaranteed Obligations; (vi) any failure to perfect or continue perfection of a security interest in any collateral which secures any of the Guaranteed Obligations; (vii) any defenses (other than defense of payment or performance in full), set-offs or counterclaims which any Borrower may allege or assert against any Secured Party in respect of the Guaranteed Obligations, including failure of consideration, breach of warranty, payment, statute of frauds, statute of limitations, accord and satisfaction and usury; and (viii) any other act or omission, or delay to do any other act, which may or might in any manner or to any extent vary the risk of any Guarantor as an obligor in respect of the Guaranteed Obligations.

Section 7.05

Waivers by Guarantors

.  Each Guarantor hereby waives, for the benefit of the Secured Parties: (a) any right to require any Secured Party, as a condition of payment or performance by such Guarantor, to (i) proceed against any Borrower, any other Guarantor (including any other Guarantor) of the applicable Guaranteed Obligations or any other Person, (ii) proceed against or exhaust any security held from any Borrower, any such other



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Guarantor or any other Person, (iii) proceed against or have resort to any balance of any deposit account or credit on the books of any Secured Party in favor of any Borrower or any other Person, or (iv) pursue any other remedy in the power of any Secured Party whatsoever; (b) any defense arising by reason of the incapacity, lack of authority or any disability or other defense of any Borrower or any other Guarantor including any defense based on or arising out of the lack of validity or the unenforceability of the Guaranteed Obligations or any agreement or instrument relating thereto or by reason of the cessation of the liability of any Borrower or any other Guarantor from any cause other than Payment in Full of the applicable Guaranteed Obligations; (c) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (d) any defense based upon any Secured Party’s errors or omissions in the administration of the Guaranteed Obligations, except behavior which amounts to bad faith; (e) (i) any principles or provisions of law, statutory or otherwise, which are or might be in conflict with the terms hereof and any legal or equitable discharge of such Guarantor’s obligations hereunder, (ii) the benefit of any statute of limitations affecting such Guarantor’s liability hereunder or the enforcement hereof, (iii) any rights to set-offs, recoupments and counterclaims, and (iv) promptness, diligence and any requirement that any Secured Party protect, secure, perfect or insure any security interest or Lien or any property subject thereto; (f) notices, demands, presentments, protests, notices of protest, notices of dishonor and notices of any action or inaction, including acceptance hereof, notices of default hereunder, or under any agreement or instrument related thereto, notices of any renewal, extension or modification of the Guaranteed Obligations or any agreement related thereto, notices of any extension of credit to any Borrower and notices of any of the matters referred to in Section 7.04 and any right to consent to any thereof; and (g) any defenses (other than defense of payment or performance in full) or benefits that may be derived from or afforded by law which limit the liability of or exonerate Guarantors or sureties, or which may conflict with the terms hereof.

Section 7.06

Guarantors’ Rights of Subrogation, Contribution, Etc.

  Until the applicable Guaranteed Obligations shall have been Paid in Full, each Guarantor hereby waives any claim, right or remedy, direct or indirect, that such Guarantor now has or may hereafter have against any applicable Borrower or any other Guarantor or any of its assets in connection with this Guaranty or the performance by such Guarantor of its obligations hereunder, in each case whether such claim, right or remedy arises in equity, under contract, by statute, under common law or otherwise and including (a) any right of subrogation, reimbursement or indemnification that such Guarantor now has or may hereafter have against any applicable Borrower with respect to the Guaranteed Obligations, (b) any right to enforce, or to participate in, any claim, right or remedy that any Secured Party now has or may hereafter have against any Borrower, and (c) any benefit of, and any right to participate in, any collateral or security now or hereafter held by any Secured Party.  In addition, until the applicable Guaranteed Obligations shall have been Paid in Full, each Guarantor shall withhold exercise of any right of contribution such Guarantor may have against any other Guarantor (including any other Guarantor) of the applicable Guaranteed Obligations, including any such right of contribution as contemplated by Section 7.02.  Each Guarantor further agrees that, to the extent the waiver or agreement to withhold the exercise of its rights of subrogation, reimbursement, indemnification and contribution as set forth herein is found by a court of competent jurisdiction to be void or voidable for any reason, any rights of subrogation, reimbursement or indemnification such Guarantor may have against any Borrower or against any collateral or



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security, and any rights of contribution such Guarantor may have against any such other Guarantor, shall be junior and subordinate to any rights any Secured Party may have against any Borrower, to all right, title and interest any Secured Party may have in any such collateral or security, and to any right any Secured Party may have against such other Guarantor.  If any amount shall be paid to any Guarantor on account of any such subrogation, reimbursement, indemnification or contribution rights at any time when all applicable Guaranteed Obligations shall not have been finally and Paid in Full, such amount shall be held in trust for the Administrative Agent on behalf of the Secured Parties and shall forthwith be paid over to the Administrative Agent for the benefit of the Secured Parties to be credited and applied against the applicable Guaranteed Obligations, whether matured or unmatured, in accordance with the terms hereof.