Exhibit 10.1
EXECUTION VERSION
$800,000,000
CREDIT AGREEMENT
dated as of December 17, 2010,
among
NOVELIS INC.,
as Parent Borrower,
NOVELIS CORPORATION
as U.S. Borrower,
THE OTHER U.S. SUBSIDIARIES OF PARENT BORROWER
PARTY HERETO AS U.S. BORROWERS,
NOVELIS UK LTD,
as U.K. Borrower,
NOVELIS AG,
as Swiss Borrower,
AV METALS INC.,
THE OTHER GUARANTORS PARTY HERETO,
THE LENDERS PARTY HERETO,
BANK OF AMERICA, N.A.,
as Administrative Agent, Collateral Agent, Issuing Bank, and U.S. Swingline Lender,
THE ROYAL BANK OF SCOTLAND PLC,
as European Swingline Lender,
and
CITIBANK, N.A.,
JPMORGAN CHASE BANK, N.A.,
THE ROYAL BANK OF SCOTLAND PLC,
UBS SECURITIES LLC
as Co-Syndication Agents,
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
as Lead Arranger
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
CITIGROUP GLOBAL MARKETS INC.
J.P. MORGAN SECURITIES LLC
RBS SECURITIES INC.
UBS SECURITIES LLC
as Joint Bookmanagers
TABLE OF CONTENTS
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ARTICLE I |
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DEFINITIONS |
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SECTION 1.01 Defined Terms
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1 |
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SECTION 1.02 Classification of Loans and Borrowings
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90 |
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SECTION 1.03 Terms Generally; Alternate Currency Transaction
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91 |
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SECTION 1.04 Accounting Terms; GAAP
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92 |
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SECTION 1.05 Resolution of Drafting Ambiguities
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93 |
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SECTION 1.06 Pro Forma Calculations
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93 |
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ARTICLE II |
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THE CREDITS |
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SECTION 2.01 Commitments
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93 |
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SECTION 2.02 Loans
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96 |
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SECTION 2.03 Borrowing Procedure
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97 |
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SECTION 2.04 Evidence of Debt
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99 |
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SECTION 2.05 Fees
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101 |
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SECTION 2.06 Interest on Loans
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102 |
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SECTION 2.07 Termination and Reduction of Commitments
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104 |
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SECTION 2.08 Interest Elections
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105 |
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SECTION 2.09 [intentionally omitted]
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106 |
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SECTION 2.10 Optional and Mandatory Prepayments of Loans
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106 |
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SECTION 2.11 Alternate Rate of Interest
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110 |
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SECTION 2.12 Yield Protection; Change in Law Generally
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110 |
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SECTION 2.13 Breakage Payments
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113 |
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SECTION 2.14 Payments Generally; Pro Rata Treatment; Sharing of Setoffs
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114 |
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SECTION 2.15 Taxes
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116 |
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SECTION 2.16 Mitigation Obligations; Replacement of Lenders
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123 |
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SECTION 2.17 Swingline Loans
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124 |
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SECTION 2.18 Letters of Credit
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127 |
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SECTION 2.19 Interest Act (Canada); Criminal Rate of Interest; Nominal Rate of Interest |
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133 |
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SECTION 2.20 [intentionally omitted]
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134 |
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SECTION 2.21 Representation to Swiss Borrower
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134 |
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SECTION 2.22 Blocked Loan Parties
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135 |
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SECTION 2.23 Increase in Commitments
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135 |
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ARTICLE III |
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REPRESENTATIONS AND WARRANTIES |
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SECTION 3.01 Organization; Powers
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137 |
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SECTION 3.02 Authorization; Enforceability
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137 |
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SECTION 3.03 No Conflicts
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138 |
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SECTION 3.04 Financial Statements; Projections
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138 |
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SECTION 3.05 Properties
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139 |
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SECTION 3.06 Intellectual Property
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140 |
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SECTION 3.07 Equity Interests and Subsidiaries
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141 |
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SECTION 3.08 Litigation; Compliance with Laws
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141 |
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SECTION 3.09 Agreements
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142 |
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SECTION 3.10 Federal Reserve Regulations
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142 |
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SECTION 3.11 Investment Company Act
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142 |
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SECTION 3.12 Use of Proceeds
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142 |
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SECTION 3.13 Taxes
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142 |
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SECTION 3.14 No Material Misstatements
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143 |
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SECTION 3.15 Labor Matters
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143 |
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SECTION 3.16 Solvency
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143 |
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SECTION 3.17 Employee Benefit Plans
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144 |
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SECTION 3.18 Environmental Matters
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145 |
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SECTION 3.19 Insurance
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146 |
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SECTION 3.20 Security Documents
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146 |
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SECTION 3.21 Material Indebtedness Documents
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150 |
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SECTION 3.22 Anti-Terrorism Law
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150 |
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SECTION 3.23 Joint Enterprise
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151 |
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SECTION 3.24 Location of Material Inventory and Equipment
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151 |
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SECTION 3.25 Accuracy of Borrowing Base
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151 |
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SECTION 3.26 Senior Notes; Material Indebtedness
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152 |
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SECTION 3.27 Centre of Main Interests and Establishments
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152 |
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SECTION 3.28 Holding and Dormant Companies
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152 |
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SECTION 3.29 Certain Subsidiaries
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152 |
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ARTICLE IV |
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CONDITIONS TO CREDIT EXTENSIONS |
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SECTION 4.01 Conditions to Initial Credit Extension
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153 |
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SECTION 4.02 Conditions to All Credit Extensions
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161 |
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ARTICLE V |
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AFFIRMATIVE COVENANTS |
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SECTION 5.01 Financial Statements, Reports, etc.
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162 |
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SECTION 5.02 Litigation and Other Notices
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165 |
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ii
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SECTION 5.03 Existence; Businesses and Properties
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166 |
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SECTION 5.04 Insurance
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166 |
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SECTION 5.05 Taxes
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168 |
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SECTION 5.06 Employee Benefits
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168 |
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SECTION 5.07 Maintaining Records; Access to Properties and Inspections; Annual
Meetings; Field Examinations and Appraisals
SECTION 5.08 Use of Proceeds
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169
170 |
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SECTION 5.09 Compliance with Environmental Laws; Environmental Reports
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170 |
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SECTION 5.10 Indenture Permitted Debt
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170 |
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SECTION 5.11 Additional Collateral; Additional Guarantors
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170 |
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SECTION 5.12 Security Interests; Further Assurances
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173 |
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SECTION 5.13 Information Regarding Collateral
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174 |
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SECTION 5.14 Affirmative Covenants with Respect to Leases
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175 |
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SECTION 5.15 Ten Non-Bank Regulations and Twenty Non-Bank Regulations
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175 |
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SECTION 5.16 Post-Closing Covenants
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175 |
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SECTION 5.17 Designation of Subsidiaries
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175 |
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ARTICLE VI |
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NEGATIVE COVENANTS |
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SECTION 6.01 Indebtedness
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176 |
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SECTION 6.02 Liens
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182 |
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SECTION 6.03 Sale and Leaseback Transactions
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186 |
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SECTION 6.04 Investments, Loan and Advances
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186 |
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SECTION 6.05 Mergers, Amalgamations and Consolidations
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189 |
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SECTION 6.06 Asset Sales
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191 |
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SECTION 6.07 Cash Pooling Arrangements
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194 |
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SECTION 6.08 Dividends
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194 |
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SECTION 6.09 Transactions with Affiliates
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196 |
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SECTION 6.10 Minimum Consolidated Fixed Charge Coverage Ratio
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197 |
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SECTION 6.11 Prepayments of Other Indebtedness; Modifications of
Organizational Documents and Other Documents, etc.
SECTION 6.12 Limitation on Certain Restrictions on Subsidiaries
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197
198 |
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SECTION 6.13 Issuance of Disqualified Capital Stock
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199 |
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SECTION 6.14 Parent Borrower
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200 |
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SECTION 6.15 Business
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200 |
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SECTION 6.16 Limitation on Accounting Changes
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200 |
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SECTION 6.17 Fiscal Year
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200 |
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SECTION 6.18 Margin Rules
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200 |
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SECTION 6.19 No Further Negative Pledge
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201 |
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SECTION 6.20 Anti-Terrorism Law; Anti-Money Laundering
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201 |
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SECTION 6.21 Embargoed Persons
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202 |
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SECTION 6.22 Forward Share Sale Agreement and Support Agreement
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202 |
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iii
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ARTICLE VII |
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GUARANTEE |
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SECTION 7.01 The Guarantee
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202 |
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SECTION 7.02 Obligations Unconditional
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203 |
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SECTION 7.03 Reinstatement
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204 |
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SECTION 7.04 Subrogation; Subordination
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204 |
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SECTION 7.05 Remedies
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205 |
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SECTION 7.06 Instrument for the Payment of Money
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205 |
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SECTION 7.07 Continuing Guarantee
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205 |
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SECTION 7.08 General Limitation on Guarantee Obligations
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205 |
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SECTION 7.09 Release of Guarantors
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205 |
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SECTION 7.10 Certain Tax Matters
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206 |
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SECTION 7.11 German Guarantor
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207 |
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SECTION 7.12 Swiss Guarantors
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209 |
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SECTION 7.13 Irish Guarantor
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210 |
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SECTION 7.14 Brazilian Guarantor
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210 |
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SECTION 7.15 French Guarantor
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210 |
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SECTION 7.16 Luxembourg Guarantor
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211 |
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ARTICLE VIII |
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EVENTS OF DEFAULT |
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SECTION 8.01 Events of Default
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212 |
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SECTION 8.02 Rescission
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215 |
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SECTION 8.03 Application of Proceeds
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216 |
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ARTICLE IX |
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COLLATERAL ACCOUNT; COLLATERAL MONITORING; APPLICATION OF COLLATERAL PROCEEDS |
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SECTION 9.01 Accounts; Cash Management
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217 |
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SECTION 9.02 Administration of Inventory and Accounts
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220 |
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SECTION 9.03 Borrowing Base-Related Reports
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222 |
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SECTION 9.04 Rescission of Activation Notice
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223 |
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ARTICLE X |
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THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT |
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SECTION 10.01 Appointment, Authority and Duties of Agents
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223 |
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SECTION 10.02 Agreements Regarding Collateral and Field Examination Reports
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225 |
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SECTION 10.03 Reliance by Agents
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226 |
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SECTION 10.04 Action Upon Default
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226 |
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iv
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SECTION 10.05 Indemnification of Agent Indemnitees
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226 |
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SECTION 10.06 Limitation on Responsibilities of Agents
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227 |
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SECTION 10.07 Successor Agents and Co-Agents
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227 |
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SECTION 10.08 Due Diligence and Non-Reliance
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228 |
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SECTION 10.09 Remittance of Payments and Collections
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228 |
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SECTION 10.10 Agent in its Individual Capacity
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229 |
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SECTION 10.11 Agent Titles
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229 |
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SECTION 10.12 Bank Product Providers
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229 |
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SECTION 10.13 No Third Party Beneficiaries
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230 |
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SECTION 10.14 Release
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230 |
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SECTION 10.15 Acknowledgment of Security Trust Deed
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230 |
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ARTICLE XI |
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MISCELLANEOUS |
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SECTION 11.01 Notices
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230 |
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SECTION 11.02 Waivers; Amendment
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234 |
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SECTION 11.03 Expenses; Indemnity; Damage Waiver
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239 |
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SECTION 11.04 Successors and Assigns
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240 |
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SECTION 11.05 Survival of Agreement
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244 |
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SECTION 11.06 Counterparts; Integration; Effectiveness
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244 |
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SECTION 11.07 Severability
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244 |
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SECTION 11.08 Right of Setoff
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245 |
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SECTION 11.09 GOVERNING LAW; JURISDICTION; CONSENT TO SERVICE OF PROCESS |
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245 |
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SECTION 11.10 WAIVER OF JURY TRIAL
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246 |
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SECTION 11.11 Headings
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247 |
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SECTION 11.12 Treatment of Certain Information; Confidentiality
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247 |
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SECTION 11.13 USA PATRIOT Act Notice
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248 |
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SECTION 11.14 Interest Rate Limitation
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248 |
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SECTION 11.15 [intentionally omitted]
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248 |
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SECTION 11.16 Obligations Absolute
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248 |
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SECTION 11.17 Intercreditor Agreement
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249 |
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SECTION 11.18 Judgment Currency
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249 |
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SECTION 11.19 Euro
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249 |
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SECTION 11.20 Special Provisions Relating to Currencies Other Than Dollars
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250 |
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SECTION 11.21 Abstract Acknowledgment of Indebtedness and Joint Creditorship
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250 |
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SECTION 11.22 Special Appointment of Collateral Agent for German Security
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251 |
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SECTION 11.23 Special Appointment of Administrative Agent in Relation to South Korea;
Certain Lock-Up or Listing Agreements
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252 |
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SECTION 11.24 Special Appointment of French Collateral Agent in Relation to France
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253 |
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SECTION 11.25 Swiss Tax Ruling
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254 |
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SECTION 11.26 Designation of Collateral Agent under Civil Code of Quebec
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254 |
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SECTION 11.27 Maximum Liability
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254 |
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SECTION 11.28 NO ORAL AGREEMENT
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255 |
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SECTION 11.29 Performance of Borrowers Obligations
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255 |
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v
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SECTION 11.30 Credit Inquiries
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255 |
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SECTION 11.31 Relationship with Lenders
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255 |
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SECTION 11.32 No Advisory or Fiduciary Responsibility
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255 |
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SECTION 11.33 Marshaling; Payments Set Aside
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256 |
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SECTION 11.34 One Obligation
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256 |
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vi
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ANNEXES |
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Annex I |
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Revolving Commitments |
Annex II |
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Applicable Margin |
Annex III |
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Mandatory Cost Formula |
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SCHEDULES |
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Schedule 1.01(a) |
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Refinancing Indebtedness to Be Repaid |
Schedule 1.01(b) |
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Subsidiary Guarantors |
Schedule 1.01(c) |
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Applicable Jurisdiction Requirements |
Schedule 1.01(d) |
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Specified Account Debtors |
Schedule 1.01(e) |
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Excluded Collateral Subsidiaries |
Schedule 1.01(f) |
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Excluded Subsidiaries |
Schedule 1.01(g) |
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Joint Venture Subsidiaries |
Schedule 1.01(h) |
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Agents Account |
Schedule 2.18(a) |
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Existing Letters of Credit |
Schedule 2.18(b) |
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Existing Commerzbank Letters of Credit |
Schedule 2.21 |
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Lenders to Swiss Borrower |
Schedule 3.06(c) |
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Violations or Proceedings |
Schedule 3.17 |
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Pension Matters |
Schedule 3.19 |
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Insurance |
Schedule 3.21 |
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Material Documents |
Schedule 3.24 |
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Location of Material Inventory |
Schedule 4.01(g) |
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Local and Foreign Counsel |
Schedule 4.01(o)(iii) |
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Title Insurance Amounts |
Schedule 5.11(b) |
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Certain Subsidiaries |
Schedule 5.16 |
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Post-Closing Covenants |
Schedule 6.01(b) |
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Existing Indebtedness |
Schedule 6.02(c) |
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Existing Liens |
Schedule 6.04(b) |
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Existing Investments |
Schedule 9.01(b) |
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Cash Management |
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EXHIBITS |
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Exhibit A |
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Form of Administrative Questionnaire |
Exhibit B |
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Form of Assignment and Assumption |
Exhibit C |
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Form of Borrowing Request |
Exhibit D |
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Form of Compliance Certificate |
Exhibit E |
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Form of Interest Election Request |
Exhibit F |
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Form of Joinder Agreement |
Exhibit G |
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Form of Landlord Access Agreement |
Exhibit H |
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Form of LC Request |
Exhibit I |
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Form of Borrowing Base Certificate |
Exhibit J |
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Form of Mortgage |
Exhibit K-1 |
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Form of Revolving Note |
Exhibit K-2 |
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Form of European Swingline Note |
Exhibit L-1 |
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Form of Perfection Certificate |
vii
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Exhibit L-2 |
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Form of Perfection Certificate Supplement |
Exhibit M-1 |
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Form of U.S. Security Agreements |
Exhibit M-2 |
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Form of Canadian Security Agreements |
Exhibit M-3 |
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Form of U.K. Security Agreements |
Exhibit M-4 |
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Form of Swiss Security Agreements |
Exhibit M-5 |
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Form of German Security Agreements |
Exhibit M-6 |
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Form of Irish Security Agreements |
Exhibit M-7 |
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Form of Brazilian Security Agreements |
Exhibit M-8 |
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Form of Luxembourg Security Agreements |
Exhibit M-9 |
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Form of Madeira Security Agreements |
Exhibit M-10 |
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Form of French Security Agreements |
Exhibit N |
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Form of Opinion of Company Counsel |
Exhibit O |
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Form of Solvency Certificate |
Exhibit P |
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Form of Intercompany Note |
viii
CREDIT AGREEMENT
This CREDIT AGREEMENT (this Agreement), dated as of December 17, 2010, is among NOVELIS
INC., a corporation amalgamated under the Canada Business Corporations Act (the Parent Borrower),
NOVELIS CORPORATION, a Texas corporation, and the other U.S. subsidiaries of the Parent Borrower
signatory hereto as borrowers (each, an Initial U.S. Borrower and, collectively, the Initial
U.S. Borrowers), NOVELIS UK LTD, a limited liability company incorporated under the laws of
England and Wales with registered number 00279596 (the U.K. Borrower), and NOVELIS AG, a stock
corporation (AG) organized under the laws of Switzerland (the Swiss Borrower and, together with
the Parent Borrower, the U.S. Borrowers, and the U.K. Borrower, the Borrowers), AV METALS INC., a
corporation formed under the Canada Business Corporations Act, the Subsidiary Guarantors (such term
and each other capitalized term used but not defined herein having the meaning given to it in
ARTICLE I), the Lenders, BANK OF AMERICA, N.A., as Issuing Bank, BANK OF AMERICA, N.A., as
U.S. swingline lender (in such capacity, U.S. Swingline Lender), BANK OF AMERICA, N.A., as
administrative agent (in such capacity, Administrative Agent) for the Secured Parties and each
Issuing Bank, BANK OF AMERICA, N.A., as collateral agent (in such capacity, Collateral Agent) for
the Secured Parties and each Issuing Bank, and THE ROYAL BANK OF SCOTLAND PLC, as European
swingline lender (in such capacity, European Swingline Lender).
WITNESSETH:
Borrowers have requested that Lenders provide a credit facility to Borrowers to finance the
mutual and collective business enterprise of the Loan Parties. Lenders are willing to provide the
credit facility on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, for valuable consideration hereby acknowledged, the parties agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01 Defined Terms. As used in this Agreement (including the preamble), the following terms
shall have the meanings specified below:
Accepting Lenders shall have the meaning assigned to such term in Section 11.02(g).
Account Debtor shall mean, Account Debtor, as such term is defined in the UCC.
Accounts shall mean all accounts, as such term is defined in the UCC, in which such Person
now or hereafter has rights.
Acquisition shall mean any transaction or series of related transactions for the direct or
indirect (a) acquisition of all or substantially all of the property and assets or business of any
Person, or of any business unit, line of business or division of any Person or assets constituting
a business unit, line of business or division of any other Person (other than a Person that is a
Restricted Subsidiary on the Closing Date), (b) acquisition of in excess of 50% of the Equity
Interests of any Person or otherwise causing a person to become a Restricted Subsidiary of the
acquiring Person (other than in connection with the formation or creation of a Restricted
Subsidiary of the Parent Borrower by any Company), or (c) merger, consolidation or amalgamation,
whereby a person becomes a Restricted Subsidiary of the acquiring person, or any other
consolidation with any Person, whereby a Person becomes a Restricted Subsidiary of the acquiring
Person.
Acquisition Consideration shall mean the purchase consideration for any Permitted
Acquisition, whether paid in cash, properties, any assumption of Indebtedness or otherwise (other
than by the issuance of Qualified Capital Stock of Holdings permitted to be issued hereunder) 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 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; provided that any such future payment that is subject to a contingency
shall be considered Acquisition Consideration only to the extent of the reserve, if any, required
under U.S. GAAP at the time of such sale to be established in respect thereof by Holdings, the
Parent Borrower or any of its Restricted Subsidiaries.
Act shall have the meaning assigned to such term in Section 11.13.
Activation Notice has the meaning assigned to such term in Section 9.01(c).
Additional Lender shall have the meaning assigned to such term in Section 2.23(a).
Additional Senior Secured Indebtedness shall mean any Indebtedness incurred in reliance of
Section 6.01(u).
Additional Senior Secured Indebtedness Documents shall mean all documents executed and
delivered with respect to the Additional Senior Secured Indebtedness or delivered in connection
therewith.
Adjusted EURIBOR Rate shall mean, with respect to any EURIBOR Borrowing for any Interest
Period, an interest rate per annum (rounded upward, if necessary, to the nearest 1/100th of 1%)
determined by the Administrative Agent to be equal to the sum of (a) (i) the EURIBOR Rate for such
EURIBOR Borrowing in effect for such Interest Period divided by (ii) 1 minus the Statutory
Reserves (if any) for such EURIBOR Borrowing for such Interest Period plus, (b) without
duplication of any increase in interest rate attributable to Statutory Reserves pursuant to the
foregoing clause (ii), the Mandatory Cost (if any).
Adjusted LIBOR Rate shall mean, with respect to any Eurocurrency Borrowing for any Interest
Period, an interest rate per annum (rounded upward, if necessary, to the nearest 1/100th of 1%)
determined by the Administrative Agent to be equal to the sum of (a) (i) the LIBOR Rate for such
Eurocurrency Borrowing in effect for such Interest Period divided by (ii) 1 minus the
Statutory Reserves (if any) for such Eurocurrency Borrowing for such Interest Period
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plus, (b) without duplication of any increase in interest rate attributable to Statutory
Reserves pursuant to the foregoing clause (ii), the Mandatory Cost (if any).
Administrative Agent shall have the meaning assigned to such term in the preamble hereto and
includes each other person appointed as the successor pursuant to ARTICLE X.
Administrative Borrower shall mean Novelis Inc., or any successor entity serving in that
role pursuant to Section 2.03(b).
Administrative Questionnaire shall mean an Administrative Questionnaire in substantially the
form of Exhibit A.
Affiliate shall mean, when used with respect to a specified person, another person that
directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is
under common Control with the person specified; provided, however, that, for
purposes of Section 6.09, the term Affiliate shall also include (i) any person that
directly or indirectly owns more than 10% of the voting power of the total outstanding Voting Stock
of the person specified or (ii) any person that is an executive officer or director of the person
specified.
Agent Indemnitees shall mean the Agents (and any sub-agent thereof) and their officers,
directors, employees, Affiliates, agents and attorneys.
Agent Professionals shall mean attorneys, accountants, appraisers, auditors, business
valuation experts, environmental engineers or consultants, turnaround consultants, and other
professionals and experts retained by any Agent.
Agents shall mean the Administrative Agent and the Collateral Agent; and Agent shall mean
either of them.
Agents Account shall have the meaning assigned to such term in Schedule 1.01(h).
Agreement shall have the meaning assigned to such term in the preamble hereto.
Alternate Currency shall mean each of euros and GBP and, with regard only to European
Swingline Loans, Swiss francs.
Alternate Currency Equivalent shall mean, as to any amount denominated in Dollars as of any
date of determination, the amount of the applicable Alternate Currency that could be purchased with
such amount of Dollars based upon the Spot Selling Rate.
Alternate Currency Letter of Credit shall mean any Letter of Credit to the extent
denominated in an Alternate Currency.
Alternate Currency Revolving Loan shall mean each Revolving Loan denominated in an Alternate
Currency.
Anti-Terrorism Laws shall have the meaning assigned to such term in Section 3.22.
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Applicable Administrative Borrower shall mean the Administrative Borrower and/or the
European Administrative Borrower, as the context may require.
Applicable Eligible Jurisdiction shall mean (i) in the case of Eligible Accounts or Eligible
Inventory of the U.S. Borrowers, the United States, Canada and, in the case of Eligible Accounts
only, Puerto Rico, (ii) in the case of Eligible Accounts or Eligible Inventory of the Canadian Loan
Parties, Canada and the United States, (iii) in the case of Eligible Accounts of an Eligible
European Loan Party (other than Swiss Borrower), an Applicable European Jurisdiction, the United
States and Canada, (iv) in the case of Eligible Accounts of the Swiss Borrower, Germany, the United
States, Canada or such other Applicable European Jurisdiction as the Administrative Agent may
approve in its Permitted Discretion and (v) in the case of Eligible Accounts of the U.S. Borrowers
or of the Canadian Loan Parties with respect to which either (x) the Account Debtors senior
unsecured debt rating is at least BBB- by S&P and Baa3 by Moodys or (y) the Account Debtors
credit quality is acceptable to the Administrative Agent, such Applicable European Jurisdictions,
as may be approved by the Administrative Agent.
Applicable European Jurisdiction shall mean Germany, United Kingdom, France, Netherlands,
Italy, Ireland, Belgium, Spain, Sweden, Finland, Austria, Denmark, Greece, Portugal, Luxembourg,
and Switzerland or any other country that from time to time is a Participating Member State that is
approved by the Administrative Agent in its Permitted Discretion as an Applicable European
Jurisdiction.
Applicable Fee shall mean, (i) for any day during the period from the Closing Date through
March 31, 2011, a rate equal to 0.625% per annum and (ii) thereafter, the Applicable Fee shall be
adjusted on each Adjustment Date (as defined below) as follows: if the average daily aggregate
utilized amount of the Revolving Commitments of the Lenders for the immediately preceding fiscal
quarter was (A) greater than 67% of the average daily aggregate amount of the Lenders Revolving
Commitments during such preceding fiscal quarter, a rate equal to 0.375% per annum, (B) greater
than 33% and less than or equal to 67% of the average daily aggregate amount of the Lenders
Revolving Commitments during such preceding fiscal quarter, a rate equal to 0.50% per annum, and
(C) less than or equal to 33% of the average daily aggregate amount of the Lenders Revolving
Commitments during such fiscal quarter, a rate equal to 0.625% per annum. Each change in the
Applicable Fee shall be effective as of the first day of each fiscal quarter during the term hereof
commencing April 1, 2011 (each such date, an Adjustment Date). For purposes of computing the
Applicable Fee with respect to Revolving Commitments, a Revolving Commitment of a Lender shall be
deemed to be used to the extent of the outstanding Revolving Loans, Swingline Exposure and LC
Exposure of such Lender.
Applicable Law shall mean all laws, rules, regulations and legally binding governmental
guidelines applicable to the Person, conduct, transaction, agreement or matter in question,
including all applicable statutory law, common law and equitable principles, and all provisions of
constitutions, treaties, statutes, rules, regulations, orders and decrees of Governmental
Authorities.
Applicable LC Applicant shall mean the Administrative Borrower, Parent Borrower and/or the
European Administrative Borrower, as the context may require.
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Applicable Margin shall mean, for any day, with respect to any Revolving Loan or Swingline
Loan, as the case may be, the applicable percentage set forth in Annex II under the appropriate
caption.
Approved Currency shall mean each of Dollars and each Alternate Currency.
Approved Fund shall mean any Fund that is administered or managed by (a) a Lender, (b) an
Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a
Lender.
Approved Member State shall mean Belgium, France, Germany, Ireland, Italy, Luxembourg, The
Netherlands, Spain, Sweden and the United Kingdom.
Arranger shall mean Merrill Lynch, Pierce, Fenner & Smith Incorporated, as lead arranger.
Asset Sale shall mean (a) any conveyance, sale, lease, sublease, assignment, transfer or
other disposition (including by way of merger or consolidation and including any Sale and Leaseback
Transaction) of any property, excluding sales of Inventory and dispositions of cash and Cash
Equivalents, in each such excluded case, which are in the ordinary course of business, by Holdings,
the Parent Borrower or any of its Restricted Subsidiaries, or (b) any issuance of any Equity
Interests of any Restricted Subsidiary of the Parent Borrower.
Asset Swap shall mean the substantially concurrent purchase and sale or exchange of Related
Business Assets or a combination of Related Business Assets and cash or Cash Equivalents between
any Company and another person; provided that any cash or Cash Equivalents received must be
applied in accordance with Section 2.10(c).
Assignment and Assumption shall mean an assignment and assumption entered into by a Lender
and an Eligible Assignee (with the consent of any party whose consent is required by Section
11.04(b)), and accepted by the Administrative Agent, in substantially the form of Exhibit
B, or any other form approved by the Administrative Agent.
Attributable Indebtedness shall mean, when used with respect to any Sale and Leaseback
Transaction, as at the time of determination, the present value (discounted at the rate implicit in
the lease) of the total obligations of the lessee for rental payments during the remaining term of
the lease included in any such Sale and Leaseback Transaction.
Auditors Determination shall have the meaning assigned to such term in Section
7.11(b).
Auto-Extension Letter of Credit shall have the meaning assigned to such term in Section
2.18(a)(v).
AV Metals shall mean AV Metals Inc., a corporation formed under the Canada Business
Corporations Act.
5
Availability Conditions shall mean that, with respect to any Proposed Transaction, each of
the following conditions are satisfied, as applicable:
(a) both immediately prior to and after giving effect to such Proposed Transaction, no Default
shall have occurred and be continuing; and
(b) when used with regard to Section 6.08 (Dividends), immediately after
giving effect to such Proposed Transaction, (i)(A) Excess Availability on the date such Proposed
Transaction is consummated and (B) average daily Excess Availability for the 30 day period
immediately preceding such Proposed Transaction (assuming such Proposed Transaction occurred on the
first day of such 30 day period), in each case is greater than or equal to the greater of
$280,000,000 and 35% of the Total Revolving Commitment or (ii)(A)(1) Excess Availability on the
date such Proposed Transaction is consummated and (2) average daily Excess Availability for the 30
day period immediately preceding such Proposed Transaction (assuming such Proposed Transaction
occurred on the first day of such 30 day period), in each case is greater than or equal to the
greater of $200,000,000 and 25% of the Total Revolving Commitment and (B) the Consolidated Fixed
Charge Coverage Ratio as of the end of the most recent fiscal quarter (on a trailing four quarter
basis, on a Pro Forma Basis after giving effect to each such Proposed Transaction as if such
Proposed Transaction occurred on the first day of the most recently ended fiscal quarter for which
financial statements have been delivered pursuant to Section 5.01(a) and (b)) shall
not be less than 1.1 to 1.0; or
(c) when used with regard to Section 6.11 (Prepayments of other Indebtedness,
etc.), immediately after giving effect to such Proposed Transaction, (i)(A) Excess Availability
on the date such Proposed Transaction is consummated and (B) average daily Excess Availability for
the 30 day period immediately preceding such Proposed Transaction (assuming such Proposed
Transaction occurred on the first day of such 30 day period), in each case is greater than or equal
to the greater of $200,000,000 and 25% of the Total Revolving Commitment or (ii)(A)(1) Excess
Availability on the date such Proposed Transaction is consummated and (2) average daily Excess
Availability for the 30 day period immediately preceding such Proposed Transaction (assuming such
Proposed Transaction occurred on the first day of such 30 day period), in each case is greater than
or equal to the greater of $160,000,000 and 20% of the Total Revolving Commitment and (B) the
Consolidated Fixed Charge Coverage Ratio as of the end of the most recent fiscal quarter (on a
trailing four quarter basis, on a Pro Forma Basis after giving effect to each such Proposed
Transaction as if such Proposed Transaction occurred on the first day of the most recently ended
fiscal quarter for which financial statements have been delivered pursuant to Section
5.01(a) and (b)) shall not be less than 1.1 to 1.0; or
(d) for all other Proposed Transactions, immediately after giving effect to such Proposed
Transaction, (i)(A) Excess Availability on the date such Proposed Transaction is consummated and
(B) average daily Excess Availability for the 30 day period immediately preceding such Proposed
Transaction (assuming such Proposed Transaction occurred on the first day of such 30 day period),
in each case is greater than or equal to the greater of $240,000,000 and 30% of the Total Revolving
Commitment or (ii)(A)(1) Excess Availability on the date such Proposed Transaction is consummated
and (2) average daily Excess Availability for the 30 day period immediately preceding such Proposed
Transaction (assuming such Proposed Transaction occurred on the first day of such 30 day period),
in each case is greater than or equal to the
6
greater of $160,000,000 and 20% of the Total Revolving Commitment and (B) the Consolidated
Fixed Charge Coverage Ratio as of the end of the most recent fiscal quarter (on a trailing four
quarter basis, on a Pro Forma Basis after giving effect to each such Proposed Transaction as if
such Proposed Transaction occurred on the first day of the most recently ended fiscal quarter for
which financial statements have been delivered pursuant to Section 5.01(a) and (b))
shall not be less than 1.1 to 1.0; and
(e) in each case, prior to undertaking any Proposed Transaction involving (i) payment of a
Dividend of $25,000,000 or more or (ii) any payment (or transfer of property having a fair market
value) of $100,000,000 or more, the Loan Parties shall deliver to the Administrative Agent an
Officers Certificate demonstrating in reasonable details the satisfaction of the conditions
contained in clause (b), (c) or (d) above, as applicable.
Availability Reserve shall mean reserves established from time to time by the Administrative
Agent pursuant to Section 2.01(d) or otherwise in accordance with this Agreement, with
respect to potential cash liabilities of the Borrowers and Borrowing Base Guarantors, costs,
expenses or other amounts that may be charged against the Revolving Credit Priority Collateral
prior to payment of the Obligations, and including reserves of the type described in clauses (i),
(ii), (iii), (v) and (vi) of Section 2.01(d).
Available Amount shall have the meaning assigned to such term in Section 7.12(a).
Average Quarterly Excess Availability shall mean, as of any date of determination, the
average daily Excess Availability for the three-fiscal month period immediately preceding such date
(with the Borrowing Base for any day during such period calculated by reference to the most recent
Borrowing Base Certificate delivered to the Administrative Agent on or prior to such day). Average
Quarterly Excess Availability shall be calculated by the Administrative Agent and such calculations
shall be presumed to be correct, absent manifest error.
Bailee Letter shall mean an agreement in form substantially similar to Exhibit 7 to the U.S.
Security Agreement or otherwise in form and substance reasonably satisfactory to the Collateral
Agent.
Bank of America shall mean Bank of America, N.A., a national banking association, and its
successors.
Bank of America Indemnitees shall mean Bank of America and its officers, directors,
employees, Affiliates, agents and attorneys.
Bank Product shall mean any of the following products, services or facilities extended to
any Company by a Lender or any of its Affiliates: (a) Cash Management Services; (b) commercial
credit card and merchant card services; and (c) other banking products or services as may be
requested by any Company, other than Letters of Credit and Hedging Agreements.
Bank Product Agreement shall mean any agreement related to Bank Products or Secured Bank
Product Obligations.
7
Bank Product Debt shall mean Indebtedness and other obligations of an Loan Party relating to
Bank Products.
Bank Product Reserve shall mean the aggregate amount of reserves established by
Administrative Agent from time to time in respect of Secured Bank Product Obligations.
Bankruptcy Code shall mean Title 11 of the United States Code.
Base Rate shall mean, for any day, a per annum rate equal to the greatest of (a) the Prime
Rate for such day; (b) the Federal Funds Rate for such day, plus 0.50%; or (c) the Adjusted LIBOR
Rate for a 30 day interest period as determined on such day, plus 1.0%.
Base Rate Borrowing shall mean a Borrowing comprised of Base Rate Loans.
Base Rate Loan shall mean any Base Rate Revolving Loan or U.S. Swingline Loan.
Base Rate Revolving Loan shall mean any U.S. Revolving Loan bearing interest at a rate
determined by reference to the Base Rate.
Beneficially Own, Beneficial Owner and Beneficial Ownership shall each have the meaning
assigned to such term in Rules 13d-3 and 13d-5 under the Exchange Act.
Blocked Account shall mean shall have the meaning assigned to such term in Section
9.01.
Blocked Loan Party shall have the meaning assigned to such term in Section 2.22.
Board shall mean the Board of Governors of the Federal Reserve System of the United States.
Board of Directors shall mean, with respect to any person, (i) in the case of any
corporation, the board of directors of such person, (ii) in the case of any limited liability
company, the board of managers (or the functional equivalent) of such person, (iii) in the case of
any limited partnership, the Board of Directors of the general partner of such person and (iv) in
any other case, the functional equivalent of the foregoing.
Borrowers shall have the meaning assigned to such term in the preamble hereto. Unless the
context otherwise requires, each reference in this Agreement to each Borrower or the applicable
Borrower shall be deemed to be a reference to (w) each U.S. Borrower on a joint and several basis,
(x) the Parent Borrower, (y) the U.K. Borrower and/or (z) the Swiss Borrower, as the case may be.
Borrowing shall mean (a) Revolving Loans to one of (w) the U.S. Borrowers, jointly and
severally, (x) Parent Borrower, (y) U.K. Borrower or (z) Swiss Borrower, in each case of the same
currency, Class, Sub-Class and Type, made, converted or continued on the same date and, in the case
of Eurocurrency Loans and EURIBOR Loans, as to which a single Interest Period is in effect, or (b)
a Swingline Loan.
8
Borrowing Base shall mean the U.S. Borrowing Base, the Canadian Borrowing Base, the U.K.
Borrowing Base, the Swiss Borrowing Base and/or the Total Borrowing Base, as the context may
require.
Borrowing Base Certificate shall mean an Officers Certificate from Administrative Borrower,
substantially in the form of (or in such other form as may, from time to time, be mutually agreed
upon by Administrative Borrower, Collateral Agent and Administrative Agent), and containing the
information prescribed by Exhibit I, delivered to the Administrative Agent and the
Collateral Agent setting forth the Administrative Borrowers calculation of the Borrowing Base.
Borrowing Base Guarantor shall mean (a) as of the Closing Date, each Canadian Guarantor and
(b) in addition thereafter, any other Wholly Owned Subsidiary of Parent Borrower that (i) is
organized in Canada or Switzerland or incorporated in England and Wales, (ii) is able to prepare
all collateral reports in a comparable manner to the Parent Borrowers reporting procedures and
(iii) has executed and delivered to Administrative Agent a joinder agreement hereto and such
joinder agreements to guarantees, contribution and set-off agreements and other Loan Documents as
Administrative Agent has reasonably requested (all of which shall be in form and substance
acceptable to, and provide a level of security and guaranty acceptable to, Administrative Agent in
its Permitted Discretion), so long as Administrative Agent has received and approved, in its
Permitted Discretion, (A) a collateral audit conducted by an independent appraisal firm reasonably
acceptable to Administrative Agent, (B) all UCC or other search results necessary to confirm
Collateral Agents Lien on all of such Borrowing Base Guarantors personal property, subject to
Permitted Liens, which Lien is a First Priority Lien with regard to the Revolving Credit Priority
Collateral, and (C) such customary certificates (including a solvency certificate), resolutions,
financial statements, legal opinions, and other documentation as the Administrative Agent may
reasonably request (including as required by Sections 5.11 and 5.12).
Borrowing Base Loan Party shall have the meaning assigned to such term in Section
9.01.
Borrowing Request shall mean a request by a Borrower in accordance with the terms of
Section 2.03 and substantially in the form of Exhibit C, or such other form as
shall be approved by the Administrative Agent.
Brazilian Guarantor shall mean each Restricted Subsidiary of Parent Borrower organized in
Brazil party hereto as a Guarantor, and each other Restricted Subsidiary of Parent Borrower
organized in Brazil that is required to become a Guarantor pursuant to the terms hereof.
Brazilian Security Agreements shall mean, collectively, any Security Agreements
substantially in the form of Exhibit M-7, including all subparts thereto, among the
Brazilian Guarantor and the Collateral Agent for the benefit of the Secured Parties.
Business Day shall mean 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, New York and
Chicago; provided, however, that when used in connection with notices and
determinations
9
in connection with, and payments of principal and interest on or with respect to, (a) a
Eurocurrency Loan, the term Business Day shall also exclude any day on which banks are not open
for dealings in Dollar deposits in the London interbank market, (b) an Alternate Currency Revolving
Loan denominated in euros, the term Business Day shall also exclude any day that is not a TARGET
Day (as determined in good faith by the Administrative Agent), and (c) a European Swingline Loan,
the term Business Day shall mean any day other than a Saturday, Sunday or other day on which
banks in Zurich are authorized or required by law to close.
Calculation Date shall have the meaning assigned to such term in the definition of Senior
Secured Net Leverage Ratio.
Canadian Borrowing Base shall mean at any time an amount equal to the sum of the Dollar
Equivalent of, without duplication:
(i) the book value of Eligible Canadian Accounts multiplied by the advance rate of 85%,
plus
(ii) the lesser of (i) the advance rate of 75% of the Cost of Eligible Canadian Inventory, or
(ii) the advance rate of 85% of the Net Recovery Cost Percentage multiplied by the Cost of Eligible
Canadian Inventory, minus
(iii) any Reserves established from time to time by the Administrative Agent with respect to
the Canadian Borrowing Base in accordance with Section 2.01(d) and the other terms of this
Agreement.
The Canadian Borrowing Base at any time shall be determined by reference to the most recent
Borrowing Base Certificate theretofore delivered to the Administrative Agent with such adjustments
as Administrative Agent deems appropriate in its Permitted Discretion to assure that the Canadian
Borrowing Base is calculated in accordance with the terms of this Agreement.
Canadian Dollar Denominated Letter of Credit shall have the meaning assigned to such term in
Section 2.18.
Canadian Dollars or Can$ shall mean the lawful money of Canada.
Canadian Guarantor shall mean Holdings (unless Holdings is released as a Guarantor pursuant
to Section 7.09 upon completion of a Qualified Parent Borrower IPO), Parent Borrower and
each Restricted Subsidiary of Parent Borrower organized in Canada party hereto as a Guarantor, and
each other Restricted Subsidiary of Parent Borrower organized in Canada that becomes or is required
to become a Guarantor pursuant to the terms hereof.
Canadian Loan Party shall mean each of the Parent Borrower and each Canadian Guarantor.
Canadian Security Agreement shall mean the Security Agreements substantially in the form of
Exhibit M-2, including all subparts thereto, among the Canadian Loan Parties and the
Collateral Agent for the benefit of the Secured Parties.
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CapEx Equity Contributions shall mean any cash contribution on account of Qualified Capital
Stock of Parent Borrower that is used within 90 days of receipt to make Capital Expenditures,
provided that (i) the Administrative Borrower by notice to the Administrative Agent at the
time of such cash contribution designates such funds as CapEx Equity Contributions and specifies
the Capital Assets to which they will be applied, and (ii) such funds are maintained at all times
by the applicable Company in a segregated Cash Collateral Account.
Capital Assets shall mean, with respect to any person, all equipment, fixed assets and Real
Property or improvements of such person, or replacements or substitutions therefor or additions
thereto, that, in accordance with U.S. GAAP, have been or should be reflected as additions to
property, plant or equipment on the balance sheet of such person.
Capital Expenditures shall mean, for any period, without duplication, all expenditures made
directly or indirectly by the Parent Borrower and its Restricted Subsidiaries during such period
for Capital Assets (whether paid in cash or other consideration, financed by the incurrence of
Indebtedness or accrued as a liability), together with the Parent Borrowers proportionate share of
such amounts for Norf GmbH for such period, but in each case excluding (solely for purposes of
determining Consolidated Fixed Charge Coverage Ratio) any portion of such expenditures (i)
constituting the Acquisition Consideration for acquisitions of property, plant and equipment in
Permitted Acquisitions, (ii) paid for with insurance proceeds or (iii) to the extent constituting
proceeds of the sale of property, plant and equipment that are used to purchase other property,
plant and equipment within ninety (90) days of the receipt of such cash proceeds.
Capital Lease Obligations of any person shall mean the obligations of such person to pay
rent or other amounts under any lease of (or other arrangement conveying the right to use) real or
personal property, or a combination thereof, which obligations are required to be classified and
accounted for as capital leases on a balance sheet of such person under U.S. GAAP, and the amount
of such obligations shall be the capitalized amount thereof determined in accordance with U.S.
GAAP. It is understood that with respect to the accounting for leases as either operating leases
or capital leases and the impact of such accounting on the definitions and covenants herein, U.S.
GAAP as in effect on the Closing Date shall be applied.
Cash Collateral Account shall mean a collateral account in the form of a deposit account
established and maintained by the Collateral Agent for the benefit of the Secured Parties.
Cash Dominion Recovery Event shall mean, with respect to any Cash Dominion Trigger Event at
any time (a) no Default or Event of Default shall have been outstanding for a period of thirty (30)
consecutive days then ended and (b) Excess Availability shall be at least the greater of (i)
$110,000,000 and (ii) 15.0% of the lesser of (A) the Total Revolving Commitment and (B) the
then-applicable Total Borrowing Base, for a period of thirty (30) consecutive days then ended.
Cash Dominion Trigger Event shall mean at any time (a) an Event of Default shall have
occurred and is continuing and/or (b) Excess Availability shall for a period of three (3)
consecutive Business Days be less than the greater of (i) $110,000,000 and (ii) 15.0% of the lesser
of (A) the Total Revolving Commitment and (B) the then-applicable Total Borrowing Base.
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Cash Equivalents shall mean, as to any person, (a) securities issued or fully guaranteed or
insured by the federal government of the United States, Canada, Switzerland, any Approved Member
State or any agency of the foregoing, (b) marketable direct obligations issued by Canada or any
province thereof, any state of the United States or the District of Columbia or any political
subdivision, government-sponsored entity or instrumentality thereof that, at the time of the
acquisition, are rated at least A-2 by S&P, P-2 by Moodys or in the R-2 category by the
Dominion Bond Rating Service Limited, (c) certificates of deposit, Eurocurrency time deposits,
overnight bank deposits and bankers acceptances of any commercial bank or trust company organized
under the laws of Canada or any province thereof, the United States, any state thereof, the
District of Columbia, any non-U.S. bank, or its branches or agencies (fully protected against
currency fluctuations) that, at the time of acquisition, is rated at least A-2 by S&P, P-2 by
Moodys or in the R-2 category by the Dominion Bond Rating Service Limited, (d) commercial paper
of an issuer rated at least A-2 by S&P, P-2 by Moodys or in the R-2 category by the Dominion
Bond Rating Service Limited, and (e) shares of any money market fund that (i) has at least 95% of
its assets invested continuously in the types of investments referred to in clauses (a), (b) and
(c) above, (ii) has net assets, the Dollar Equivalent of which exceeds $500,000,000 and (iii) is
rated at least A-2 by S&P, P-2 by Moodys or in the R-2 category by the Dominion Bond Rating
Service Limited; provided, however, that the maturities of all obligations of the
type specified in clauses (a), (b) and (c) above shall not exceed 365 days; provided,
further, that, to the extent any cash is generated through operations in a jurisdiction
outside of the United States, Canada, Switzerland or an Approved Member State, such cash may be
retained and invested in obligations of the type described in clause (c) applicable to such
jurisdiction to the extent that such obligations are customarily used in such other jurisdiction
for short term cash management purposes.
Cash Management Services shall mean any services provided from time to time by any Lender or
any of its Affiliates to any Company in connection with operating, collections, payroll, trust, or
other depository or disbursement accounts, including automated clearinghouse, e-payable, electronic
funds transfer, wire transfer, controlled disbursement, overdraft, depository, information
reporting, lockbox and stop payment services.
Cash Management System shall have the meaning assigned to such term in Section 9.01.
Cash Pooling Arrangements shall mean (i) the DB Cash Pooling Arrangement, the Novelis AG
Cash Pooling Agreement and the Commerzbank Cash Pooling Agreement; provided that the Commerzbank
Cash Pooling Agreement shall cease to be effective not later than 180 days after the Closing Date
(or such later date as may be agreed to by the Administrative Agent) and (ii) any other cash
pooling arrangements (including all documentation pertaining thereto) entered into by any Company
in accordance with Section 6.07.
Casualty Event shall mean any involuntary loss of title, any involuntary loss of, damage to
or any destruction of, or any expropriation, condemnation or other taking (including by any
Governmental Authority) of, any property of Holdings, the Parent Borrower or any of its Restricted
Subsidiaries. Casualty Event shall include but not be limited to any taking of all or any part
of any Real Property of any person or any part thereof, in or by expropriation, condemnation or
other eminent domain proceedings pursuant to any requirement of Applicable
12
Law, or by reason of the temporary requisition of the use or occupancy of all or any part of
any Real Property of any person or any part thereof by any Governmental Authority, civil or
military, or any settlement in lieu thereof.
CERCLA shall mean the Comprehensive Environmental Response, Compensation, and Liability Act
of 1980, as amended, 42 U.S.C. § 9601 et seq. and all implementing regulations.
A Change in Control shall be deemed to have occurred if:
(a) At any time prior to a Qualified IPO, Hindalco ceases to be the Beneficial Owner of Voting
Stock representing more than 50% of the voting power of the total outstanding Voting Stock of
Holdings;
(b) At any time prior to a Qualified Parent Borrower IPO, Holdings at any time ceases to be
the Beneficial Owner and the direct record owner of 100% of the Equity Interests of Parent
Borrower; provided that a Permitted Holdings Amalgamation shall not constitute a Change in
Control;
(c) Parent Borrower at any time ceases to be the Beneficial Owner and the direct or indirect
owner of 100% of the Equity Interests of any other Borrower;
(d) at any time a change in control (or change of control or similar event) with respect to
the Parent Borrower or Novelis Corporation occurs under (and as defined in) any Material
Indebtedness of any Loan Party;
(e) (i) at any time after a Qualified IPO (other than a Qualified Parent Borrower IPO), any
person or group (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) other
than the Specified Holders is or becomes the Beneficial Owner (provided that for purposes of this
clause (except as set forth below) such person or group shall be deemed to have Beneficial
Ownership of all securities that such person or group has the right to acquire, whether such right
is exercisable immediately or only after the passage of time) of Voting Stock of Holdings
representing 35% or more of the voting power of the total outstanding Voting Stock of Holdings
unless the Specified Holders at all times Beneficially Own Voting Stock of Holdings representing
greater voting power of the total outstanding Voting Stock of Holdings than such voting power held
by such person or group; or (ii) at any time after a Qualified Parent Borrower IPO, any person or
group (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) other than the
Specified Holders is or becomes the Beneficial Owner (provided that for purposes of this clause
(except as set forth below) such person or group shall be deemed to have Beneficial Ownership of
all securities that such person or group has the right to acquire, whether such right is
exercisable immediately or only after the passage of time) of Voting Stock of Parent Borrower
representing 35% or more of the voting power of the total outstanding Voting Stock of Parent
Borrower unless the Specified Holders at all times Beneficially Own Voting Stock of Parent Borrower
representing greater voting power of the total outstanding Voting Stock of Parent Borrower than
such voting power held by such person or group; or
(f) during any period of two consecutive years, individuals who at the beginning of such
period constituted the Board of Directors of Holdings or Parent Borrower (together with
13
any new directors whose election to such Board of Directors or whose nomination for election
was approved by the Specified Holders or by a vote of at least a majority of the members of the
Board of Directors of Holdings or Parent Borrower, as the case may be, which members comprising
such majority are then still in office and were either directors at the beginning of such period or
whose election or nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors of Holdings or Parent Borrower.
For purposes of this definition, a person shall not be deemed to have Beneficial Ownership of
Equity Interests subject to a stock purchase agreement, merger agreement or similar agreement until
the consummation of the transactions contemplated by such agreement.
Change in Law shall mean the occurrence, after the date of this Agreement, of any of the
following: (a) the adoption or taking into effect of any law, treaty, order, policy, rule or
regulation, (b) any change in any law, treaty, order, policy, rule or regulation or in the
administration, interpretation or application thereof by any Governmental Authority or (c) the
making or issuance of any request, guideline or directive (whether or not having the force of law)
by any Governmental Authority; provided, however, that notwithstanding anything
herein to the contrary, the Dodd-Frank Wall Street Reform and Consumer Protection Act and all
requests, rules, regulations, guidelines or directives thereunder or issued in connection therewith
shall be deemed to be a Change in Law, regardless of the date enacted, adopted or issued.
Chattel Paper shall mean all chattel paper, as such term is defined in the UCC, in which
any Person now or hereafter has rights.
Chief Executive Office shall mean, with respect to any Person, the location from which such
Person manages the main part of its business operations or other affairs.
Claim shall mean all liabilities, obligations, losses, damages, penalties, judgments,
proceedings, interest, costs and expenses of any kind (including remedial response costs,
reasonable attorneys fees and Extraordinary Expenses) at any time (including after Full Payment of
the Secured Obligations, resignation or replacement of any Agent, or replacement of any Lender)
incurred by or asserted against any Indemnitee in any way relating to (a) any Loans, Letters of
Credit, Loan Documents, or the use thereof or transactions relating thereto, (b) any action taken
or omitted to be taken by any Indemnitee in connection with any Loan Documents, (c) the existence
or perfection of any Liens, or realization upon any Collateral, (d) exercise of any rights or
remedies under any Loan Documents or Applicable Law, or (e) failure by any Loan Party to perform or
observe any terms of any Loan Document, in each case including all costs and expenses relating to
any investigation, litigation, arbitration or other proceeding (including an Insolvency Proceeding
or appellate proceedings), whether or not the applicable Indemnitee is a party thereto.
Class, when used in reference to any Loan or Borrowing, refers to whether such Loan, or the
Loans comprising such Borrowing, are Revolving Loans or European Swingline Loans and, when used in
reference to any Commitment, refers to whether such Commitment is a Revolving Commitment or
European Swingline Commitment, in each case, under this Agreement as originally in effect or
pursuant to Section 2.23, of which such Loan, Borrowing or Commitment shall be a part.
14
Closing Date shall mean the date of the initial Credit Extension hereunder.
Closing Date Distribution shall mean (i) the payment by the Parent Borrower no later than 45
days following the Closing Date with the proceeds of loans advanced under this Agreement, the Term
Loan Agreement, the New Senior Notes and/or cash on hand of a return of capital or other
distribution to Holdings not to exceed $1,700,000,000 in the aggregate, and (ii) the payment by
Holdings within 45 days of the Closing Date of a return of capital or other distribution to its
equity holder not to exceed the amount received as a return of capital or other distribution from
the Parent Borrower pursuant to clause (i) above.
Code shall mean the Internal Revenue Code of 1986, as amended and the Treasury Regulations
promulgated thereunder.
Collateral shall mean, all of the Collateral, Pledged Collateral and Mortgaged
Property referred to in the Security Documents and all of the other property that is or is
intended under the terms of the Security Documents to be subject to Liens in favor of the
Collateral Agent for the benefit of the Secured Parties.
Collateral Agent shall have the meaning assigned to such term in the preamble hereto and
includes each other person appointed as the successor pursuant to ARTICLE X.
Collection Account has the meaning assigned to such term in Section 9.01(c).
Commercial Letter of Credit shall mean any letter of credit or similar instrument issued for
the purpose of providing credit support in connection with the purchase of materials, goods or
services by Parent Borrower or any of its Subsidiaries in the ordinary course of their businesses.
Commerzbank shall mean Commerzbank AG, New York and Grand Cayman Branches and its Affiliates
and their respective successors, in each case which is a Swiss Qualifying Bank.
Commerzbank Cash Pooling Agreement shall mean an Agreement regarding an Automatic Cash
Management System entered into between Novelis AG, the Companies (as defined therein) and
Commerzbank Aktiengesellschaft, Berlin dated 15 January 2007, together with all ancillary
documentation thereto.
Commitment shall mean, with respect to any Lender, such Lenders Revolving Commitment and/or
European Swingline Commitment, including any Commitment pursuant to Section 2.23.
Commitment Fee shall have the meaning assigned to such term in Section 2.05(a).
Commitment Letter shall mean that certain commitment letter among the Parent Borrower, Bank
of America, Merrill Lynch, Pierce, Fenner & Smith Incorporated, and the other commitment parties
party thereto, dated as of December 6, 2010.
Communications shall have the meaning assigned to such term in Section 11.01(d).
15
Companies shall mean Holdings (unless Holdings has been released as a Guarantor pursuant to
Section 7.09(d)), the Parent Borrower and its Restricted Subsidiaries; and Company shall
mean any one of them.
Compensation Plan shall mean any program, plan or similar arrangement (other than employment
contracts for a single individual) relating generally to compensation, pension, employment or
similar arrangements with respect to which any Company, any Affiliate of any Company or any ERISA
Affiliate of any of them has any obligation or liability, contingent or otherwise, under any
Applicable Law other than that of the United States.
Compliance Certificate shall mean a certificate of a Financial Officer substantially in the
form of Exhibit D.
Concentration Account shall have the meaning assigned to such term in Section
9.01(c).
Concentration Account Bank shall have the meaning assigned to such term in Section
9.01(c).
Confidential Information Memorandum shall mean that certain confidential information
memorandum of the Parent Borrower, dated November 2010.
Consolidated Amortization Expense shall mean, for any period, the amortization expense of
the Parent Borrower and its Restricted Subsidiaries for such period, determined on a consolidated
basis in accordance with U.S. GAAP.
Consolidated Current Liabilities shall mean, as at any date of determination, the total
liabilities of the Parent Borrower and its Restricted Subsidiaries which may properly be classified
as current liabilities (other than the current portion of any Loans) on a consolidated balance
sheet of the Parent Borrower and its Restricted Subsidiaries in accordance with U.S. GAAP, but
excluding (a) the current portion of any Funded Debt of the Parent Borrower and its Restricted
Subsidiaries and (b) without duplication of clause (a) above, all Indebtedness consisting of Loans
to the extent otherwise included therein.
Consolidated Depreciation Expense shall mean, for any period, the depreciation expense of
Parent Borrower and its Restricted Subsidiaries for such period, determined on a consolidated basis
in accordance with U.S. GAAP.
Consolidated EBITDA (Fixed Charge) shall mean, for any period, the sum of (A) Consolidated
Net Income (Fixed Charge) for such period, adjusted by (without duplication):
(x) adding thereto, in each case only to the extent (and in the same proportion)
deducted in determining such Consolidated Net Income and without duplication:
(a) Consolidated Interest Expense for such period,
(b) Consolidated Amortization Expense for such period,
16
(c) Consolidated Depreciation Expense for such period,
(d) Consolidated Tax Expense for such period,
(e) non-recurring cash expenses and charges relating to the Transactions (including,
but not limited to, any premiums, fees, discounts, expenses and losses payable by the Parent
Borrower in connection with any Debt Tender Offer) to the extent paid on or about the
Closing Date,
(f) restructuring charges in an amount not to exceed $15,000,000 in the aggregate
during any four consecutive fiscal quarters;
(h) the aggregate amount of all other non-cash charges reducing Consolidated Net Income
(excluding any non-cash charge that results in an accrual of a reserve for cash charges in
any future period) for such period; and
(i) the amount of net income (loss) attributable to non-controlling interests deducted
(and not added back) in computing Consolidated Net Income (Fixed Charge);
(y) subtracting therefrom, the aggregate amount of all non-cash items increasing
Consolidated Net Income (Fixed Charge) (other than the accrual of revenue or recording of
receivables in the ordinary course of business) for such period; and
(z) excluding therefrom,
(a) any gain (or loss), together with any related provisions for taxes on any such gain
(or the tax effect of any such loss), realized during such period by the Parent Borrower or
any of its Restricted Subsidiaries upon any Asset Sale (other than any dispositions in the
ordinary course of business) by the Parent Borrower or any of its Restricted Subsidiaries,
(b) remeasurement gains and losses due solely to fluctuations in currency values of
non-current assets and liabilities, until such time as such gains or losses are realized,
(c) earnings or losses resulting from any reappraisal, revaluation or write-up or
write-down of assets (other than write-downs of Inventory),
(d) any one-time increase or decrease to net income that is required to be recorded
because of the adoption of new accounting policies, practices or standards required by GAAP,
and
(e) unrealized gains and losses with respect to Hedging Obligations for such period.
plus (B) the proportionate interest of the Parent Borrower and its consolidated
Restricted Subsidiaries in non-consolidated Affiliate EBITDA for such period.
17
Consolidated EBITDA (Fixed Charge) shall be calculated on a Pro Forma Basis to give effect to any
Permitted Acquisition and Asset Sales (other than any dispositions in the ordinary course of
business, dispositions where the value of the assets disposed of is less than $15,000,000 and
Permitted Acquisitions where the amount of the Acquisition Consideration plus any Equity Interests
constituting all or a portion of the purchase price is less than $15,000,000) consummated at any
time on or after the first day of the Test Period thereof as if each such Permitted Acquisition had
been effected on the first day of such period and as if each such Asset Sale had been consummated
on the day prior to the first day of such period.
Consolidated EBITDA (Fixed Charge) shall not include the Consolidated EBITDA (Fixed Charge) of any
Non-consolidated Affiliate if such Non-consolidated Affiliate is subject to a prohibition, directly
or indirectly, on the payment of dividends or the making of distributions, directly or indirectly,
to the Borrower, to the extent of such prohibition.
Consolidated EBITDA (Leverage) shall mean, for any period, the sum of (A) Consolidated Net
Income (Leverage) for such period, adjusted by (without duplication):
(x) adding thereto, in each case only to the extent (and in the same proportion)
deducted in determining such Consolidated Net Income (Leverage) and without duplication:
(a) Consolidated Interest Expense for such period,
(b) Consolidated Amortization Expense for such period,
(c) Consolidated Depreciation Expense for such period,
(d) Consolidated Tax Expense for such period,
(e) (i) non-recurring items or unusual charges or expenses, severance, relocation
costs or expenses, other business optimization expenses (including costs and
expenses relating to business optimization programs), new systems design and
implementation costs, project start-up costs, restructuring charges or reserves,
costs related to the closure and/or consolidation of facilities and one-time costs
associated with a Qualified IPO and (ii) the annualized amount of net cost savings,
operating expense reductions and synergies reasonably projected by the Parent
Borrower in good faith to be realized as a result of specified actions (x) taken
since the beginning of the Test Period in respect of which Consolidated EBITDA
(Leverage) is being determined or (y) initiated prior to or during the Test Period
(in each case, which cost savings shall be added to Consolidated EBITDA (Leverage)
until fully realized, but in no event for more than four fiscal quarters)
(calculated on a pro forma basis as though such annualized cost savings, operating
expense reductions and synergies had been realized on the first day of such Test
Period, net of the amount of actual benefits realized during such Test Period from
such actions; provided that (A) such cost savings, operating expense reductions and
synergies are reasonably identifiable, quantifiable and factually supportable in the
good faith judgment of the Parent Borrower, and (B) no cost savings, operating
expense reductions and synergies shall be added pursuant to this clause (e) to the
extent duplicative of any expenses or charges otherwise
18
added to Consolidated EBITDA (Leverage), whether through a pro forma adjustment or
otherwise, for such Test Period; provided that the aggregate amount added to
Consolidated EBITDA (Leverage) pursuant to this clause (e) shall not exceed in the
aggregate 10% of Consolidated EBITDA (Leverage) for any one Test Period;
provided, further that projected (and not yet realized) amounts may
no longer be added in calculating Consolidated EBITDA (Leverage) pursuant to clause
(ii) of this paragraph (e) to the extent occurring more than four full fiscal
quarters after the specified action taken or initiated in order to realize such
projected cost savings, operating expense reductions and synergies;
(f) [intentionally omitted]
(g) the aggregate amount of all other non-cash charges reducing Consolidated Net
Income (Leverage) (excluding any non-cash charge that results in an accrual of a
reserve for cash charges in any future period) for such period; and
(h) the amount of net income (loss) attributable to non-controlling interests
deducted (and not added back) in computing Consolidated Net Income (Leverage); and
(i) Management Fees paid in compliance with Section 6.08(c);
(y) subtracting therefrom, (a) the aggregate amount of all non-cash items increasing
Consolidated Net Income (Leverage) (other than the accrual of revenue or recording of receivables
in the ordinary course of business) for such period and (b) interest income; and
(z) excluding therefrom,
(a) gains and losses due solely to fluctuations in currency values of non-current
assets and liabilities, realized gains and losses on currency derivatives related to such
non-current assets and liabilities determined in accordance with U.S. GAAP for such period;
(b) earnings or losses resulting from any reappraisal, revaluation or write-up or
write-down of assets;
(c) non-recurring or unusual gains; and
(d) any gain or loss relating to cancellation or extinguishment of Indebtedness;
plus (B) the proportionate interest of the Parent Borrower and its consolidated Restricted
Subsidiaries in Non-consolidated Affiliate EBITDA for such period.
Notwithstanding the foregoing clause (x), the provision for taxes and the depreciation,
amortization and non-cash items of a Restricted Subsidiary shall be added to Consolidated Net
Income (Leverage) to compute Consolidated EBITDA (Leverage) only to the extent (and in the same
proportion) that the net income of such Restricted Subsidiary was included in calculating
Consolidated Net Income (Leverage).
19
Consolidated EBITDA (Leverage) shall not include the Consolidated EBITDA (Leverage) of any
Non-consolidated Affiliate if such Non-consolidated Affiliate is subject to a prohibition, directly
or indirectly, on the payment of dividends or the making of distributions, directly or indirectly,
to the Borrower, to the extent of such prohibition.
Consolidated Fixed Charge Coverage Ratio shall mean, for any Test Period, the ratio of (a)
(i) Consolidated EBITDA (Fixed Charge) for such Test Period minus (ii) the aggregate amount
of Capital Expenditures for such period that were not specifically funded by Indebtedness (other
than a Revolving Loan or Swingline Loan) or CapEx Equity Contributions minus (iii) all cash
payments in respect of income taxes (including all taxes imposed on or measured by overall net
income (however denominated), and franchise taxes imposed in lieu of net income taxes) made during
such period (net of any cash refund in respect of income taxes actually received during such
period) to (b) Consolidated Fixed Charges for such Test Period.
Consolidated Fixed Charges shall mean, for any period, the sum, without duplication, of:
(a) Consolidated Interest Expense payable in cash for such period;
(b) the principal amount of all scheduled amortization payments on all Indebtedness
(including the principal component of all Capital Lease Obligations) and the principal
amount of all mandatory prepayments of all Indebtedness of the Parent Borrower and its
Restricted Subsidiaries based on excess cash flow of Parent Borrower and its Restricted
Subsidiaries for such period;
(c) Dividends paid in cash pursuant to Section 6.08(c) or (i); and
(d) Management Fees (except to the extent such payments reduce Consolidated Net Income
(Fixed Charge)).
Consolidated Interest Expense shall mean, for any period, the total consolidated interest
expense of Parent Borrower and its Restricted Subsidiaries for such period determined on a
consolidated basis in accordance with U.S. GAAP plus, without duplication:
(a) imputed interest on Capital Lease Obligations and Attributable Indebtedness of
Parent Borrower and its Restricted Subsidiaries for such period;
(b) commissions, discounts and other fees and charges owed by Parent Borrower or any of
its Restricted Subsidiaries with respect to letters of credit securing financial
obligations, bankers acceptance financing and receivables financings for such period;
(c) amortization of debt issuance costs, debt discount or premium and other financing
fees and expenses incurred by Parent Borrower or any of its Restricted Subsidiaries for such
period;
(d) all interest paid or payable with respect to discontinued operations of Parent
Borrower or any of its Restricted Subsidiaries for such period; and
20
(e) the interest portion of any deferred payment obligations of Parent Borrower or any
of its Restricted Subsidiaries for such period.
Consolidated Net Income (Fixed Charge) shall mean, for any period, the consolidated net
income (or loss) of Parent Borrower and its Restricted Subsidiaries determined on a consolidated
basis in accordance with U.S. GAAP; provided, however, that:
(a) the net income (or loss) of any person in which any person other than the Parent
Borrower and its Restricted Subsidiaries has an ownership interest (which interest does not
cause the net income of such other person to be consolidated into the net income of the
Parent Borrower and its Restricted Subsidiaries) shall be excluded, except to the extent
actually received by the Parent Borrower or any of its Restricted Subsidiaries during such
period; and
(b) the net income (or loss) of any Restricted Subsidiary of the Parent Borrower other
than a Loan Party that is subject to a prohibition on the payment of dividends or similar
distributions by such Restricted Subsidiary shall be excluded to the extent of such
prohibition, except the aggregate amount of cash distributed by such Restricted Subsidiary
during such period to the Parent Borrower or another Restricted Subsidiary as a dividend or
other distribution.
For purposes of this definition of Consolidated Net Income (Fixed Charge), Consolidated Net
Income shall be reduced (to the extent not already reduced thereby) by the amount of any payments
to or on behalf of Holdings made pursuant to Section 6.08(c).
Consolidated Net Income (Leverage) shall mean, for any period, the consolidated net income
(or loss) of the Parent Borrower and its Restricted Subsidiaries determined on a consolidated basis
in accordance with U.S. GAAP; provided, however, that the following shall be
excluded in the calculation of Consolidated Net Income (Leverage):
(a) any net income (loss) of any person (other than the Parent Borrower) if such person is not
a Restricted Subsidiary of the Parent Borrower, except that:
(i) subject to the exclusion contained in clause (c) below, equity of the
Parent Borrower and its consolidated Restricted Subsidiaries in the net income of
any such person for such period shall be included in such Consolidated Net Income
(Leverage) up to the aggregate amount of cash distributed by such person during such
period to the Parent Borrower or to a Restricted Subsidiary as a dividend or other
distribution (subject, in the case of a dividend or other distribution to a
Restricted Subsidiary, to the limitations contained in clause (b), below); and
(ii) the equity of the Parent Borrower and its consolidated Restricted
Subsidiaries in a net loss of any such person other than an Unrestricted Subsidiary
for such period shall be included in determining such Consolidated Net Income
(Leverage);
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(b) any net income (loss) of any Restricted Subsidiary of the Parent Borrower if such
Restricted Subsidiary is subject to a prohibition, directly or indirectly, on the payment of
dividends or the making of distributions, directly or indirectly, to the Parent Borrower, to the
extent of such prohibition, except that:
(i) subject to the exclusion contained in clause (c) below, equity of the
Parent Borrower and its consolidated Restricted Subsidiaries in the net income of
any such person for such period shall be included in such Consolidated Net Income
(Leverage) up to the aggregate amount of cash distributed by such Restricted
Subsidiary during such period to the Parent Borrower or another Restricted
Subsidiary as a dividend or other distribution (subject, in the case of a dividend
or other distribution to a Restricted Subsidiary, to the limitations contained in
this clause (b)); and
(ii) the equity of the Parent Borrower and its consolidated Restricted
Subsidiaries in a net loss of any such person other than an Unrestricted Subsidiary
for such period shall be included in determining such Consolidated Net Income
(Leverage);
(c) any gain or loss realized upon the sale or other disposition of any property of the Parent
Borrower or Restricted Subsidiaries (including pursuant to any Sale and Leaseback Transaction) that
is not sold or otherwise disposed of in the ordinary course of business (provided that sales or
other dispositions of assets in connection with any Qualified Securitization Transaction permitted
hereunder shall be deemed to be in the ordinary course);
(d) any extraordinary gain or loss;
(e) the cumulative effect of a change in accounting principles;
(f) any non-cash compensation expense realized for grants of performance shares, stock options
or other rights to officers, directors and employees of the Parent Borrower or any Restricted
Subsidiary; provided that such shares, options or other rights can be redeemed at the
option of the holders only for Qualified Capital Stock of the Parent Borrower or Holdings;
(g) any unrealized gain or loss resulting in such period from Hedging Obligations (as
defined in the Term Loan Credit Agreement) or any similar term in any Term Loan Credit Agreement
Refinancing Indebtedness;
(h) any expenses or charges in such period related to the Transactions (including, but not
limited to, any premiums, fees, discounts, expenses and losses payable by the Parent Borrower in
connection with any Debt Tender Offer (as defined in the Term Loan Credit Agreement)) and any
acquisition, disposition, recapitalization or the incurrence of any Indebtedness permitted
hereunder, including such fees, expenses or charges related to the Transactions; and
(i) the effects of adjustments in the property, plant and equipment, inventories, goodwill,
intangible assets and debt line items in the Parent Borrowers consolidated financial
22
statements pursuant to U.S. GAAP resulting from the application of purchase accounting in
relation to any acquisition or the amortization or write-off of any amounts thereof, net of taxes.
Consolidated Net Tangible Assets shall mean, as of any date of determination, the sum of the
amounts that would appear on a consolidated balance sheet of the Parent Borrower and its Restricted
Subsidiaries as the total assets (less accumulated depreciation and amortization, allowances for
doubtful receivables, other applicable reserves and other properly deductible items) of the Parent
Borrower and its Restricted Subsidiaries, after giving effect to purchase accounting and after
deducting therefrom Consolidated Current Liabilities and, to the extent otherwise included, the
amounts of (without duplication):
(a) the excess of cost over fair market value of assets or businesses acquired;
(b) any revaluation or other write-up in book value of assets subsequent to
September 30, 2010, as a result of a change in the method of valuation in accordance
with U.S. GAAP;
(c) unamortized debt discount and expenses and other unamortized deferred charges,
goodwill, patents, trademarks, service marks, trade names, copyrights, licenses,
organization or developmental expenses and other intangible items;
(d) minority interests in consolidated Subsidiaries held by Persons other than the
Parent Borrower or any Restricted Subsidiary of the Parent Borrower;
(e) treasury stock;
(f) cash or securities set aside and held in a sinking or other analogous fund
established for the purpose of redemption or other retirement of Equity Interests to
the extent such obligation is not reflected in Consolidated Current Liabilities; and
(g) Investments in and assets of Unrestricted Subsidiaries.
Consolidated Tax Expense shall mean, for any period, the tax expense of Parent Borrower and
its Restricted Subsidiaries, for such period, determined on a consolidated basis in accordance with
U.S. GAAP.
Consolidated Total Assets shall mean at any date of determination, the total assets of
Parent Borrower and its Restricted Subsidiaries, determined on a consolidated basis in accordance
with U.S. GAAP.
Consolidated Total Net Debt shall mean, as of any date of determination and without
duplication, the sum of (A) the aggregate principal amount of Indebtedness of the Parent Borrower
and its Restricted Subsidiaries outstanding on such date of the type referenced in clauses (a), (b)
and (f) of the definition of Indebtedness, and any Continent Obligations of the Parent Borrower and
its Restricted Subsidiaries in respect of Indebtedness of any Person under clauses (a), (b) and (f)
of the definition of Indebtedness, minus the aggregate amount of Unrestricted Cash on such
date, plus (B) the proportionate interest of the Parent Borrower and its
23
consolidated Restricted Subsidiaries in the Non-consolidated Affiliate Debt of each of the
Non-consolidated Affiliates at any date of determination. The aggregate principal amount of such
Indebtedness shall be determined according to the face or principal amount thereof, based on the
amount owing under the applicable contractual obligation (without regard to any election by the
Parent Borrower, Holdings or any other Person to measure an item of Indebtedness using fair value
or any other discount that may be applicable under U.S. GAAP (including the effects of FASB ASC 825
and FASB ASC 470-20 on financial liabilities) on a consolidated basis with respect to the Parent
Borrower and its Restricted Subsidiaries in accordance with consolidation principles utilized in
U.S. GAAP.
Contingent Obligation shall mean, as to any person, any obligation, agreement, understanding
or arrangement of such person guaranteeing or intended to guarantee any Indebtedness, leases,
dividends or other obligations (primary obligations) of any other person (the primary obligor)
in any manner, whether directly or indirectly, including any obligation of such person, whether or
not contingent, (a) under any guaranty, endorsement, co-making or sale with recourse of an
obligation of a primary obligor; (b) to purchase any such primary obligation or any property
constituting direct or indirect security therefor; (c) to advance or supply funds (i) for the
purchase or payment of any such primary obligation or (ii) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary
obligor; (d) to purchase property, securities or services primarily for the purpose of assuring the
owner of any such primary obligation of the ability of the primary obligor to make payment of such
primary obligation; (e) with respect to bankers acceptances, letters of credit and similar credit
arrangements, until a reimbursement obligation arises (which reimbursement obligation shall
constitute Indebtedness); or (f) otherwise to assure or hold harmless the holder of such primary
obligation against loss in respect thereof; provided, however, that the term
Contingent Obligation shall not include endorsements of instruments for deposit or collection in
the ordinary course of business or any product warranties. The amount of any Contingent Obligation
shall be deemed to be an amount equal to the stated or determinable amount of the primary
obligation in respect of which such Contingent Obligation is made (or, if less, the maximum amount
of such primary obligation for which such person may be liable, whether singly or jointly, pursuant
to the terms of the instrument evidencing such Contingent Obligation) or, if not stated or
determinable, the maximum reasonably anticipated liability in respect thereof (assuming such person
is required to perform thereunder) as determined by such person in good faith.
Contribution, Intercompany, Contracting and Offset Agreement shall mean that certain
Contribution, Intercompany, Contracting and Offset Agreement dated as of the date hereof by and
among the Loan Parties (other than certain Foreign Subsidiaries), the Collateral Agent and the
Administrative Agent.
Contribution Notice shall mean a contribution notice issued by the Pensions Regulator under
Section 38 or Section 47 of the Pensions Act 2004.
Control shall mean the possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a person, whether through the ownership of voting
securities, by contract or otherwise, and the terms Controlling and Controlled shall have
meanings correlative thereto.
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Control Agreement shall mean, with respect to a Deposit Account, Securities Account, or
Commodity Account (each as defined in the UCC), (i) located in the United States, an agreement in
form and substance reasonably satisfactory to the Collateral Agent establishing the Collateral
Agents Control (within the meaning of the UCC) in such account, or (ii) located in other
jurisdictions, agreements with regard to such accounts establishing and perfecting the First
Priority Lien of the Collateral Agent in such accounts, and effecting the arrangements set forth in
Section 9.01 (to the extent required by such Section), and otherwise in form and substance
reasonably satisfactory to the Collateral Agent.
Cost shall mean, with respect to Inventory, the lower of (a) cost computed on a weighted
average basis in accordance with GAAP or (b) market value; provided, that for purposes of
the calculation of the Borrowing Base, (i) the Cost of the Inventory shall not include: the portion
of the cost of Inventory equal to the profit earned by any Affiliate on the sale thereof to any
Loan Party and (ii) notwithstanding anything to the contrary contained herein, the cost of the
Inventory shall be computed in the same manner and consistent with the historical accounting
practices of the Parent Borrower and its Subsidiaries (it being understood that the Inventory
Appraisal has been prepared, and each future Inventory Appraisal will be prepared, in a manner
consistent with such practices).
Covenant Recovery Event shall mean, with respect to any Covenant Trigger Event at any time
(a) no Default or Event of Default shall have been outstanding for a period of thirty (30)
consecutive days then ended and (b) Excess Availability shall be at least the greater of (i)
$90,000,000 and (ii) 12.5% of the lesser of (A) the Total Revolving Commitment and (B) the
then-applicable Total Borrowing Base, for a period of thirty (30) consecutive days then ended.
Covenant Trigger Event shall mean as of any Business Day (a) an Event of Default shall have
occurred and is continuing and/or (b) Excess Availability shall as of any date be less than the
greater of (i) $90,000,000 and (ii) 12.5% of the lesser of (A) the Total Revolving Commitment and
(B) the then-applicable Total Borrowing Base.
Credit Extension shall mean, as the context may require, (i) the making of a Loan by a
Lender or (ii) the issuance of any Letter of Credit (including assumption of Existing Letters of
Credit), or the extension or renewal of any existing Letter of Credit, or an amendment of any
existing Letter of Credit that increases the amount or changes the drawing conditions thereof, by
any Issuing Bank.
Credit Protective Advance shall have the meaning assigned to such term in Section
2.01(f).
DB Cash Pooling Arrangements shall mean the cash pooling arrangements among the Parent
Borrower, certain other Loan Parties and Deutsche Bank pursuant to the Transaction Banking Services
Agreement among such parties and any documents ancillary thereto.
Debt Tender Offer shall mean the tender offers and consent solicitations for each series of
Existing Senior Notes pursuant to the Offer to Purchase and Consent Solicitation Statement of the
Parent Borrower dated November 26, 2010, relating to each series of Existing Senior Notes, as in
effect on the Closing Date.
25
Debtor Relief Laws means the Bankruptcy Code and all other liquidation, conservatorship,
bankruptcy, assignment for the benefit of creditors, moratorium, arrangement, rearrangement,
readjustment, composition, liquidation, receivership, insolvency, reorganization, examination, or
similar debtor relief or debt adjustment laws of the United States or other applicable
jurisdictions from time to time in effect and affecting the rights of creditors generally.
Default shall mean an Event of Default or an event, occurrence or condition which is, or
upon notice, lapse of time or both would constitute, an Event of Default.
Default Notice shall have the meaning assigned to such term in Section 8.01(f).
Default Rate shall have the meaning assigned to such term in Section 2.06(f).
Defaulting Lender means, subject to Section 2.14(f), any Lender that, as determined
by the Administrative Agent, (a) has failed to perform any of its funding obligations hereunder
within three Business Days of the date required to be funded by it hereunder, absent a good faith
dispute with respect to such obligation, (b) has notified the Parent Borrower, or the
Administrative Agent that it does not intend to comply with its funding obligations or has made a
public statement to that effect with respect to its funding obligations hereunder or generally
under other agreements in which it commits to extend credit, absent a good faith dispute with
respect to such obligation, (c) has failed, within three Business Days after request by the
Administrative Agent, to confirm in a manner satisfactory to the Administrative Agent that it will
comply with its funding obligations, or (d) has, or has a direct or indirect parent company that
has, (i) become the subject of any Insolvency Proceeding, (ii) had a receiver, conservator,
trustee, administrator, examiner, assignee for the benefit of creditors or similar Person charged
with reorganization or liquidation of its business or a custodian appointed for it, or (iii) taken
any action in furtherance of, or indicated its consent to, approval of or acquiescence in any such
proceeding or appointment; provided that a Lender shall not be a Defaulting Lender solely
by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or
indirect parent company thereof by a Governmental Authority.
Delegate shall mean any delegate, agent, attorney, trustee or co-trustee appointed by the
Collateral Agent or any Receiver.
Dilution Reserve shall mean a reserve established by Administrative Agent in accordance with
Section 2.01(d) with respect to Accounts in respect of dilution.
Disqualified Capital Stock shall mean any Equity Interest which, by its terms (or by the
terms of any security into which it is convertible or for which it is exchangeable), or upon the
happening of any event, (a) matures (excluding any maturity as the result of an optional redemption
by the issuer thereof) or is mandatorily redeemable other than solely for Qualified Capital Stock,
pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder
thereof, in whole or in part, on or prior to 180 days after the Maturity Date, (b) is convertible
into or exchangeable (unless at the sole option of the issuer thereof) for (i) debt securities or
(ii) any Equity Interests referred to in (a) above, in each case at any time on or prior to 180
days after the Maturity Date, or (c) contains any mandatory repurchase obligation which may come
into effect prior to 180 days after the Maturity Date; provided, however, that any
26
Equity Interests that would not constitute Disqualified Capital Stock but for provisions
thereof giving holders thereof (or the holders of any security into or for which such Equity
Interests is convertible, exchangeable or exercisable) the right to require the issuer thereof to
redeem such Equity Interests upon the occurrence of a change in control or an asset sale occurring
prior to 180 days after the Maturity Date shall not constitute Disqualified Capital Stock if such
Equity Interests provide that the issuer thereof will not redeem any such Equity Interests pursuant
to such provisions prior to the Full Payment of the Obligations.
Distribution shall mean, collectively, with respect to each Loan Party, all dividends, cash,
options, warrants, rights, instruments, distributions, returns of capital or principal, income,
interest, profits and other property, interests (debt or equity) or proceeds, including as a result
of a split, revision, reclassification or other like change of the Pledged Securities, from time to
time received, receivable or otherwise distributed to such Loan Party in respect of or in exchange
for any or all of the Pledged Securities or Pledged Intercompany Notes.
Dividend with respect to any person shall mean that such person has declared or paid a
dividend or returned any equity capital to the holders of its Equity Interests or made any other
distribution, payment or delivery of property (other than Qualified Capital Stock of such person)
or cash to the holders of its Equity Interests as such, or redeemed, retired, purchased or
otherwise acquired, directly or indirectly, for consideration any of its Equity Interests
outstanding (or any options or warrants issued by such person with respect to its Equity
Interests), or set aside any funds for any of the foregoing purposes, or shall have permitted any
of its Subsidiaries to purchase or otherwise acquire for consideration any of the Equity Interests
of such person outstanding (or any options or warrants issued by such person with respect to its
Equity Interests). Without limiting the foregoing, Dividends with respect to any person shall
also include all payments made or required to be made by such person with respect to any stock
appreciation rights, plans, equity incentive or achievement plans or any similar plans or setting
aside of any funds for the foregoing purposes, except to the extent such payments reduce
Consolidated Net Income (Fixed Charge) or Consolidated Net Income (Leverage), as applicable.
Dollar Denominated Loan shall mean each Loan denominated in Dollars at the time of the
incurrence thereof.
Dollar Equivalent shall mean, as to any amount denominated in any currency other than
Dollars as of any date of determination, the amount of Dollars that would be required to purchase
the amount of such currency based upon the Spot Selling Rate as of such date; provided that
(i) for purposes of (x) determining compliance with Sections 2.01, 2.02, 2.10(b), 2.17 and
2.18 and (y) calculating Fees pursuant to Section 2.05, the Dollar Equivalent of any
amounts denominated in a currency other than Dollars shall be calculated on the Closing Date or the
date when a subsequent Loan is made or a prepayment is required to be made, and at such other times
as the Administrative Agent may elect (which may be on a daily basis), using the Spot Selling Rate
therefor, (ii) for purposes of determining aggregate Revolving Exposure, the Dollar Equivalent of
any Revolving Exposure denominated in a currency other than Dollars shall be calculated by the
Administrative Agent on a daily basis using the Spot Selling Rate in effect for such day and (iii)
the Spot Selling Rate used to make determination of any Borrowing Base as reported in any currency
other than Dollars in any Borrowing Base Certificate shall be determined (x) initially by the
Administrative Borrower, using the Spot Selling Rate that was in
27
effect on the day immediately prior to the date on which such Borrowing Base Certificate is
delivered to the Administrative Agent pursuant to Section 5.01(j) or Section
9.03(a), and (y) thereafter, by the Administrative Agent on a daily basis using the Spot
Selling Rate as in effect from time to time, as determined by the Administrative Agent;
provided, that as to amounts determined in Dollars, the Dollar Equivalent of such amount
shall be such amount in Dollars.
Dollars or dollars or $ shall mean lawful money of the United States.
Eligible Accounts shall mean, on any date of determination of the Borrowing Base, all of the
Accounts owned by each Borrower and each Borrowing Base Guarantor, as applicable (including
Purchased Receivables acquired by a Borrower or Borrowing Base Guarantor pursuant to a Receivables
Purchase Agreement except as otherwise provided below), and reflected in the most recent Borrowing
Base Certificate delivered by the Administrative Borrower to the Collateral Agent and the
Administrative Agent, except any Account to which any of the exclusionary criteria set forth below
applies. Eligible Accounts shall not include any of the following Accounts:
(i) any Account in which the Collateral Agent, on behalf of the Secured Parties, does not
have a valid, perfected First Priority Lien;
(ii) any Account that is not owned by a Borrower or a Borrowing Base Guarantor;
(iii) Accounts with respect to which the Account Debtor (other than a Governmental
Authority) either (A) does not maintain its Chief Executive Office in an Applicable Eligible
Jurisdiction, or (B) is not organized under the laws of an Applicable Eligible Jurisdiction or any
state, territory, province or subdivision thereof;
(iv) any Account that is payable in any currency other than Dollars; provided,
that (i) Eligible Canadian Accounts may also be payable in Canadian Dollars and (ii) Eligible
European Accounts may also be payable in any Alternate Currency, Swiss Francs, Norwegian Kroner,
Swedish Kronor, or Danish Kroner;
(v) any Account that does not arise from the sale of goods or the performance of services
by such Borrower or Borrowing Base Guarantor (or, with respect only to Accounts acquired by Swiss
Borrower pursuant to a Receivables Purchase Agreement, each Receivables Seller) in the ordinary
course of its business;
(vi) any Account (a) upon which the right of a Borrower or Borrowing Base Guarantor, as
applicable, to receive payment is contingent upon the fulfillment of any condition whatsoever
unless such condition is satisfied or (b) as to which either a Borrower or Borrowing Base
Guarantor, as applicable, is not able to bring suit or otherwise enforce its remedies against the
Account Debtor through judicial or administrative process or (c) that represents a progress billing
consisting of an invoice for goods sold or used or services rendered pursuant to a contract under
which the Account Debtors obligation to pay that invoice is subject to a Borrowers or Borrowing
Base Guarantors, as applicable, completion of further performance under such contract or is
subject to the equitable lien of a surety bond issuer;
28
(vii) to the extent that any defense, counterclaim, setoff or dispute is asserted as to
such Account, it being understood that the amount of any such defense, counterclaim, setoff or
dispute shall be reflected in the applicable Borrowing Base Certificate and that the remaining
balance of the Account shall be eligible;
(viii) any Account that is not a true and correct statement of bona fide indebtedness
incurred in the amount of the Account for merchandise sold to or services rendered to the
applicable Account Debtor;
(ix) any Account with respect to which an invoice or electronic transmission constituting
a request for payment has not been sent;
(x) any Account that arises from a sale to any director, officer, other employee or
Affiliate of any Company;
(xi) to the extent any Company, including any Loan Party or Subsidiary, is liable for
goods sold or services rendered by the applicable Account Debtor to any Company, including any Loan
Party or Subsidiary, but only to the extent of the potential offset;
(xii) any Account that arises with respect to goods that are delivered on a bill-and-hold,
cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which
the payment by the Account Debtor is or may be conditional;
(xiii) any Account that is subject to the occurrence of any of the following:
(1) such Account has not been paid within one hundred twenty (120) days following its
original invoice date or is more than sixty (60) days past due according to its original terms of
sale; or
(2) the Account Debtor obligated upon such Account suspends business, makes a general
assignment for the benefit of creditors or fails to pay its debts generally as they come due; or
(3) a petition is filed by or against any Account Debtor obligated upon such Account under
any Debtor Relief Law;
(xiv) any Account that is the obligation of an Account Debtor (other than an individual)
if 50% or more of the Dollar amount of all Accounts owing by that Account Debtor are ineligible
under clause (xiii) of this definition;
(xv) any Account as to which any of the representations or warranties in, or pursuant to,
the Loan Documents, or any Receivables Purchase Agreement are untrue in any material respect;
(xvi) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper;
29
(xvii) that portion of any Account in respect of which there has been, or should have
been, established by any Borrower or Borrowing Base Guarantor or the Receivables Seller a contra
account, whether in respect of contractual allowances with respect to such Account, audit
adjustment, anticipated discounts or otherwise;
(xviii) any Account on which the Account Debtor is a Governmental Authority where
Applicable Law imposes any requirement (including any requirement of notice, acceptance or
acknowledgment by the Governmental Authority) to constitute a valid assignment as against such
Governmental Authority, unless a Borrower or Borrowing Base Guarantor, as applicable, has assigned
its rights to payment of such Account to the Administrative Agent (or in the case of Account
acquired by a Borrower or Borrowing Base Guarantor pursuant to a Receivables Purchase Agreement,
unless the Receivables Seller has assigned such rights to the purchaser, and the purchaser has
further assigned such rights to Administrative Agent) pursuant to the Assignment of Claims Act of
1940, as amended, in the case of a U.S. federal Governmental Authority or complied with such
requirement pursuant to Applicable Law in the case of any other Governmental Authority (including,
in the case of Canada, the Financial Administration Act);
(xix) Accounts that are subject to (a) extended retention of title arrangements (for
example, verlängerter Eigentumsvorbehalt, including a processing clause, Verarbeitungsklausel) with
respect to any part of the Inventory or goods giving rise to such Account or similar arrangements
under any Applicable Law to the extent of a claim that validly survives by law or contract that can
effectively be enforced pursuant to such title retention arrangements or (b) that are subject to an
enforceable restriction on assignment;
(xx) with respect to Accounts of any Eligible U.K. Loan Party or any Swiss Borrowing Base
Guarantor, Accounts with respect to which (i) the agreement evidencing such Accounts is not
governed by the laws of Germany, Canada or any province thereof, England and Wales or any state in
the United States, or the laws of such other jurisdictions acceptable to the Administrative Agent
in its Permitted Discretion (each, an Acceptable Governing Law) or (ii) if governed by an
Acceptable Governing Law, the requirements, if any, set forth on Schedule 1.01(c) hereto
with respect to such Acceptable Governing Law (or the respective Accounts) are not satisfied;
(xxi) with respect to Accounts of any Eligible U.K. Loan Party or any Swiss Borrowing Base
Guarantor, Accounts where the Account Debtor either maintains its Chief Executive Office or is
organized under the laws of an Applicable European Jurisdiction, the United States or Canada and
the requirements, if any, set forth on Schedule 1.01(c) hereto with respect to such Account
Debtor in such jurisdiction have not been satisfied;
(xxii) which is owing by an Account Debtor to the extent the aggregate amount of Accounts
owing from such Account Debtor and its Affiliates to all Borrowers exceeds 20% (or, with regard to
Account Debtors listed on Schedule 1.01(d), such higher amount as is set forth on such
Schedule) of the aggregate amount of Eligible Accounts of all Borrowers; provided that the amount
excluded from Eligible Accounts because they exceed the foregoing percentage shall be determined by
the Administrative Agent based upon all of the otherwise Eligible Accounts prior to giving effect
to any eliminations based upon the foregoing concentration limit;
30
(xxiii) any Account acquired by the Swiss Borrower pursuant to the German Receivables
Purchase Agreement that is a Disqualified Receivable (as defined therein);
(xxiv) any Account acquired by Swiss Borrower pursuant to a Receivables Purchase Agreement
which is not in full force and effect or under which any party thereto has defaulted in its
obligations thereunder or disaffirmed in writing its obligations thereunder;
(xxv) any Account of the Swiss Borrower acquired pursuant to the German Receivables
Purchase Agreement with respect to which notice is required to have been given pursuant to the
Swiss Security Agreement, unless such notice has been given in accordance therewith; or
(xxvi) which the Administrative Agent determines in its Permitted Discretion may not be
paid by reason of the Account Debtors inability to pay or which the Administrative Agent otherwise
determines in its Permitted Discretion is unacceptable for any reason whatsoever (in which event
the Administrative Agent shall provide notice and an opportunity to discuss in accordance with the
procedures set forth in the last three sentences of Section 2.01(d), mutatis mutandis).
Notwithstanding the foregoing, no Account will be characterized as ineligible pursuant to any of
the criteria set forth in paragraphs (iii), (iv), (xiii), (xiv), (xviii) through (xxv) above to the
extent that the Account Debtors obligations thereunder are insured pursuant to a credit insurance
arrangement in form and substance, and with a creditworthy insurer, all of which is satisfactory to
the Administrative Agent in its sole and absolute discretion.
Eligible Assignee shall mean a Person that is (a) a Lender, a U.S.-based Affiliate of a
Lender or an Approved Fund; (b) any other financial institution approved by Administrative Agent
and Administrative Borrower (which approval by Administrative Borrower shall not be unreasonably
withheld or delayed, and shall be deemed given if no objection is made within two Business Days
after notice of the proposed assignment), that is organized under the laws of the United States or
any state or district thereof, has total assets in excess of $5,000,000,000, extends asset-based
lending facilities in its ordinary course of business and whose becoming an assignee would not
constitute a prohibited transaction under Section 4975 of the Code or any other Applicable Law; and
(c) during any Event of Default, any Person acceptable to Administrative Agent in its discretion;
provided that (x) no approval of Administrative Borrower shall be required prior to the
earlier of (i) three months after the Closing Date and (ii) the completion of the primary
syndication of the Commitments and Loans (as determined by the Arranger) (such period, the
Syndication Period), (y) Eligible Assignee shall not include Holdings, any Loan Party or any of
their respective Affiliates or Subsidiaries or any natural person and (z) each assignee Lender
shall be subject to each other applicable requirement regarding Lenders hereunder, including
Sections 2.21, 5.15 and Section 11.04 (including Section 11.04
(f)); provided, however, that during the Syndication Period and after giving
effect to assignments made in connection with the primary syndication of the Commitments and Loans,
there shall be no more than nine (9) non-bank lenders.
Eligible Canadian Accounts shall mean the Eligible Accounts owned by the Canadian Loan
Parties.
31
Eligible Canadian Inventory shall mean the Eligible Inventory owned by the Canadian Loan
Parties.
Eligible European Accounts shall mean the Eligible Accounts owned by an Eligible European
Loan Party.
Eligible European Loan Party shall mean the U.K. Borrower, the Swiss Borrower, or any other
Borrowing Base Guarantor incorporated in England and Wales.
Eligible German Accounts shall mean the Eligible Accounts purchased by Swiss Borrower from a
Receivables Seller pursuant to the German Receivables Purchase Agreement, including Eligible Large
Customer German Accounts and Eligible Small Customer German Accounts.
Eligible Inventory shall mean Inventory consisting of goods, including raw materials and
work in process, held for sale by any U.S. Borrower, any Canadian Loan Party, or any Eligible U.K.
Loan Party, in the ordinary course, but shall exclude any Inventory to which any of the
exclusionary criteria set forth below applies. Eligible Inventory shall not include any Inventory
of any U.S. Borrower, Canadian Loan Party, or any Eligible U.K. Loan Party that:
(i) the Collateral Agent, on behalf of Secured Parties, does not have a valid, perfected
First Priority Lien on;
(ii) (1) is stored at a leased location, unless either (x) a Landlord Access Agreement has
been delivered to the Collateral Agent, or (y) a Rent Reserve has been established with respect
thereto or (2) is stored with a bailee or warehouseman (including Inventory stored or located at
the Logan Location, whether Logan has possession as a warehouseman, bailee, consignee or otherwise)
unless either (x) an acknowledged Bailee Letter has been delivered to the Collateral Agent and (in
the case of a bailee that is a merchant in goods of that kind) the applicable Loan Party has filed
appropriate UCC (or comparable) filings to perfect its interest in such Inventory or (y) a Rent
Reserve has been established with respect thereto; provided that this clause (ii) shall not
apply to any Inventory (A) constituting Vendor Managed Inventory in the aggregate for all such
locations of less than the greater of 10% of Eligible Inventory and $20,000,000, or (B) located in
any jurisdiction outside of the United States or Canada where such agreements are not customary;
(iii) is placed on consignment, unless a valid consignment agreement which is reasonably
satisfactory to Collateral Agent is in place with respect to such Inventory;
(iv) is covered by a negotiable document of title, unless such document has been delivered
to the Collateral Agent with all necessary endorsements, free and clear of all Liens except those
in favor of the Collateral Agent and the Lenders and landlords, carriers, bailees and warehousemen
if clause (ii) above has been complied with;
(v) is to be returned to suppliers;
(vi) is obsolete (excluding items that can be recycled as scrap), unsalable, shopworn,
seconds, damaged or unfit for sale;
32
(vii) consists of display items, samples or packing or shipping materials, manufacturing
supplies, work-in-process Inventory (other than work-in-process Inventory that is in saleable form
as reflected in the most recent Inventory Appraisal) or replacement parts;
(viii) is not of a type held for sale in the ordinary course of any U.S. Borrowers,
Eligible U.K. Loan Partys, or Canadian Loan Partys, as applicable, business;
(ix) breaches in any material respect any of the representations or warranties pertaining
to Inventory set forth in the Loan Documents;
(x) consists of Hazardous Material;
(xi) is not covered by casualty insurance maintained as required by Section 5.04;
(xii) is subject to any licensing arrangement the effect of which would be to limit the
ability of Collateral Agent, or any person selling, leasing or otherwise disposing of, the
Inventory on behalf of Collateral Agent, to complete or sell, lease or otherwise dispose of such
Inventory in enforcement of the Collateral Agents Liens, without further consent or payment to the
licensor or any other third party;
(xiii) is subject to an asserted claim of infringement or other violation (whether as a
result of an invitation to license or the like) of any third partys Intellectual Property
Rights, but only to the extent of such claim;
(xiv) is not at a location within the United States, Canada, or England and Wales
scheduled on Schedule 3.24 (as updated from time to time in accordance with Section
5.13), except in accordance with Section 5.13, unless in transit between locations
permitted by Section 5.13 or as otherwise permitted by clause (xv);
(xv) is in transit with a common carrier from vendors and suppliers, provided Inventory in
transit from vendors and suppliers may be included as eligible pursuant to this clause (xv)
so long as (i) the Administrative Agent shall have received evidence of satisfactory casualty
insurance naming the Collateral Agent as loss payee and otherwise covering such risks as the
Administrative Agent may reasonably request, (ii) such Inventory is located in the United States,
Canada or England and Wales, (iii) such Inventory is not on-the-water; and (iv) such Inventory is
in transit for not more than 48 hours; provided that up to $15,000,000 of Inventory in
transit by rail for longer periods may be included as Eligible Inventory and (v) the common
carrier is not an Affiliate of the applicable vendor or supplier;
(xvi) with respect to Inventory of any U.K. Borrower or any other Borrowing Base Guarantor
incorporated in England and Wales, Inventory any part of which is subject to valid retention of
title provisions to the extent of such claim; or
(xvii) which the Administrative Agent otherwise determines in its Permitted Discretion is
unacceptable for any reason whatsoever (in which event the Administrative Agent shall provide
notice and an opportunity to discuss in accordance with the procedures set forth in the last three
sentences of Section 2.01(d), mutatis mutandis).
33
Eligible Large Customer German Accounts shall mean Eligible German Accounts for which a
Large Customer (as defined in the German Receivables Purchase Agreement) is the Account Debtor.
Eligible Small Customer German Accounts shall mean all Eligible German Accounts other than
Eligible Large Customer German Accounts.
Eligible Swiss Accounts shall mean Eligible German Accounts and Eligible Swiss Subsidiary
Accounts.
Eligible Swiss Subsidiary Accounts shall mean the Eligible Accounts purchased by Swiss
Borrower from a Receivables Seller pursuant to a Swiss Receivables Purchase Agreement;
provided that the eligibility of such accounts shall be subject to (i) execution and
delivery of a Swiss Receivables Purchase Agreement and related documentation satisfactory, each in
form and substance satisfactory to the Administrative Agent, (ii) completion of field examinations
with regard to such Receivables Sellers, (iii) such other documentation as Administrative Agent may
request, including legal opinions and certificates, and (iv) such other conditions precedent and
eligibility criteria as may be established by the Administrative Agent in its sole discretion,
which may include any item referred to in clauses (y) and (z) of Section 11.02(h).
Eligible U.K. Accounts shall mean the Eligible Accounts owned by an Eligible U.K. Loan
Party.
Eligible U.K. Inventory shall mean the Eligible Inventory owned by an Eligible U.K. Loan
Party.
Eligible U.K. Loan Party shall mean the U.K. Borrower or any other Borrowing Base Guarantor
incorporated in England and Wales.
Eligible U.S. Accounts shall mean the Eligible Accounts owned by the U.S. Borrowers.
Eligible U.S. Inventory shall mean the Eligible Inventory owned by the U.S. Borrowers.
Embargoed Person shall have the meaning assigned to such term in Section 6.21.
Enforcement Action shall mean any action to enforce any Secured Obligations or Loan
Documents or to exercise any rights or remedies relating to any Collateral (whether by judicial
action, self-help, notification of Account Debtors, exercise of setoff or recoupment, exercise of
any right to vote or act in a Loan Partys Insolvency Proceeding, or otherwise).
Engagement Letter shall mean that certain engagement letter among the Parent Borrower, Bank
of America, Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities LLC, and the
other financial institutions party thereto, dated as of November 30, 2010.
Environment shall mean the natural environment, including air (indoor or outdoor), surface
water and groundwater (including potable water, navigable water and wetlands), the land
34
surface or subsurface strata, natural resources, the workplace or as otherwise defined in any
Environmental Law.
Environmental Claim shall mean any claim, notice, demand, order, action, suit, proceeding or
other formal communication alleging liability for or obligation with respect to any investigation,
remediation, removal, cleanup, response, corrective action, damages to natural resources, personal
injury, property damage, fines, penalties or other costs resulting from, related to or arising out
of (i) the presence, Release or threatened Release in or into the Environment of Hazardous Material
at any location or (ii) any violation or alleged violation of any Environmental Law, and shall
include any claim seeking damages, contribution, indemnification, cost recovery, compensation or
injunctive relief resulting from, related to or arising out of the presence, Release or threatened
Release of Hazardous Material or alleged injury or threat of injury to the Environment or to human
health or safety relating to or arising out of the use of, exposure to or Releases or threatened
Releases of Hazardous Material.
Environmental Law shall mean any and all treaties, laws, statutes, ordinances, regulations,
rules, decrees, orders, judgments, consent orders, consent decrees, code or other legally binding
requirements, and the common law, relating to protection of human health or the Environment, the
Release or threatened Release of Hazardous Material, natural resources or natural resource damages,
or occupational safety or health, and any and all Environmental Permits.
Environmental Permit shall mean any permit, license, approval, registration, notification,
exemption, consent or other authorization required by or from a Governmental Authority under
Environmental Law.
Equipment shall mean equipment, as such term is defined in the UCC, in which such Person
now or hereafter has rights.
Equity Interest shall mean, with respect to any person, any and all shares, interests,
participations or other equivalents, including membership interests (however designated, whether
voting or nonvoting), of equity of such person, including, if such person is a partnership,
partnership interests (whether general or limited) and any other interest or participation that
confers on a person the right to receive a share of the profits and losses of, or distributions of
property of, such partnership, whether outstanding on the date hereof or issued after the Closing
Date, but excluding debt securities convertible or exchangeable into such equity.
ERISA shall mean the Employee Retirement Income Security Act of 1974, as the same may be
amended from time to time.
ERISA Affiliate shall mean, with respect to any person, any trade or business (whether or
not incorporated) that, together with such person, is treated as a single employer under Section
414 of the Code.
ERISA Event shall mean (a) any reportable event, as defined in Section 4043 of ERISA or
the regulations issued thereunder, with respect to a Plan (other than an event for which the thirty
(30) day notice period is waived by regulation); (b) the failure to meet the minimum funding
standard of Section 412 of the Code with respect to any Plan whether or not waived; (c)
35
the failure to make by its due date a required installment under Section 430(j) of the Code
with respect to any Plan or the failure to make any required contribution to a Multiemployer Plan;
(d) the filing pursuant to Section 412 of the Code or Section 303(d) of ERISA of an application for
a waiver of the minimum funding standard with respect to any Plan; (e) the incurrence by any
Company or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the
termination of any Plan, other than for PBGC premiums due but not delinquent under Section 4007 of
ERISA; (f) the receipt by any Company or any of its ERISA Affiliates from the PBGC or a plan
administrator of any notice relating to the intention to terminate any Plan or Plans or to appoint
a trustee to administer any Plan; (g) the occurrence of any event or condition which could
reasonably be expected to constitute grounds under Section 4042 of ERISA for the termination of, or
the appointment of a trustee to administer, any Plan; (h) the incurrence by any Company or any of
its ERISA Affiliates of any liability with respect to the withdrawal from any Plan subject to
Section 4063 of ERISA or a cessation of operation that is treated as a withdrawal under Section
406(e) of ERISA; (i) a complete or partial withdrawal by any Company or any ERISA Affiliate from a
Multiemployer Plan resulting in material Withdrawal Liability or a determination that a
Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of
Title IV of ERISA; (j) the making of any amendment to any Plan which could result in the imposition
of a lien or the posting of a bond or other security; and (k) the occurrence of a nonexempt
prohibited transaction (within the meaning of Section 4975 of the Code or Section 406 of ERISA)
which could reasonably be expected to result in a Material Adverse Effect.
EURIBOR Borrowing shall mean a Borrowing comprised of EURIBOR Loans.
EURIBOR Interest Period shall mean, with respect to any EURIBOR Borrowing, the period
commencing on the date of such Borrowing and ending on the numerically corresponding day in the
calendar month that is one, two, three or six months later (or 14 days if agreed to by all Lenders
or, with regard only to a European Swingline Loan denominated in Euros, between 2 and 7 days), as
Administrative Borrower may elect; provided that (a) if any EURIBOR Interest Period would
end on a day other than a Business Day, such EURIBOR Interest Period shall be extended to the next
succeeding Business Day unless such next succeeding Business Day would fall in the next calendar
month, in which case such EURIBOR Interest Period shall end on the immediately preceding Business
Day, (b) any EURIBOR Interest Period that commences on the last Business Day of a calendar month
(or on a day for which there is no numerically corresponding day in the last calendar month of such
EURIBOR Interest Period) shall end on the last Business Day of the last calendar month of such
EURIBOR Interest Period, (c) Administrative Borrower shall not select a EURIBOR Interest Period
that would extend beyond the Maturity Date of the applicable Loan, (d) Administrative Borrower
shall not select EURIBOR Interest Periods so as to require a payment or prepayment of any EURIBOR
Loan during a EURIBOR Interest Period for such Loan and (e) any EURIBOR Borrowings (other than
Borrowings of European Swingline Loans) made or continued during the Syndication Period, shall have
a EURIBOR Interest Period of one month. For purposes hereof, the date of a Borrowing initially
shall be the date on which such Borrowing is made and thereafter shall be the effective date of the
most recent conversion or continuation of such Borrowing.
36
EURIBOR Loan shall mean any Revolving Loan or European Swingline Loan bearing interest at a
rate determined by reference to the Adjusted EURIBOR Rate in accordance with the provisions of
ARTICLE II.
EURIBOR Rate shall mean, with respect to any EURIBOR Borrowing for any Interest Period, the
interest rate per annum determined by the Banking Federation of the European Union for deposits in
Euro (for delivery on the first day of such Interest Period) with a term comparable to such
Interest Period, determined as of approximately 11:00 a.m., Brussels time, on the second full
TARGET Day preceding the first day of such Interest Period (as set forth by Reuters or any
successor thereto or any other service selected by the Administrative Agent which has been
nominated by the Banking Federation of the European Union as an authorized information vendor for
the purpose of displaying such rates); provided, however, that (i) if no comparable
term for an Interest Period is available, the EURIBOR Rate shall be determined using the weighted
average of the offered rates for the two terms most nearly corresponding to such Interest Period
and (ii) if the rate referenced above is not available, EURIBOR Rate shall mean, with respect to
each day during each Interest Period pertaining to EURIBOR Borrowings comprising part of the same
Borrowing, the rate per annum equal to the rate at which the Administrative Agent (or such other
bank or banks as may be designated by the Administrative Agent in consultation with European
Administrative Borrower) is offered deposits in Euros at approximately 11:00 a.m., Brussels time,
two TARGET Days prior to the first day of such Interest Period, for delivery on the first day of
such Interest Period for the number of days comprised therein and in an amount comparable to the
amount of such EURIBOR Borrowing to be outstanding during such Interest Period (or such other
amount as the Administrative Agent may reasonably determine).
euro or Euro or shall mean the single currency of the Participating Member States.
Euro Denominated Loan shall mean each Loan denominated in euros at the time of the
incurrence thereof.
Eurocurrency Borrowing shall mean a Borrowing comprised of Eurocurrency Loans.
Eurocurrency Interest Period shall mean, with respect to any Eurocurrency Borrowing, the
period commencing on the date of such Borrowing and ending on the numerically corresponding day in
the calendar month that is one, two, three or six months (or 14 days if agreed to by all Lenders
or, with regard only to a European Swingline Loan denominated in GBP or Swiss francs, between 2 and
7 days), as Administrative Borrower may elect; provided that (a) if any Eurocurrency Interest
Period would end on a day other than a Business Day, such Eurocurrency Interest Period shall be
extended to the next succeeding Business Day unless such next succeeding Business Day would fall in
the next calendar month, in which case such Eurocurrency Interest Period shall end on the
immediately preceding Business Day, (b) any Eurocurrency Interest Period that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically corresponding day
in the last calendar month of such Eurocurrency Interest Period) shall end on the last Business Day
of the last calendar month of such Eurocurrency Interest Period, (c) Administrative Borrower shall
not select a Eurocurrency Interest Period that would extend beyond the Maturity Date of the
applicable Loan, (d)
37
Administrative Borrower shall not select Eurocurrency Interest Periods so as to require a
payment or prepayment of any Eurocurrency Loan during a Eurocurrency Interest Period for such Loans
and (e) any Eurocurrency Borrowings (other than Borrowings of European Swingline Loans) made or
continued during the Syndication Period, shall have a Eurocurrency Interest Period of one month.
For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is
made and thereafter shall be the effective date of the most recent conversion or continuation of
such Borrowing.
Eurocurrency Loan shall mean any Revolving Loan or European Swingline Loan bearing interest
at a rate determined by reference to the Adjusted LIBOR Rate in accordance with the provisions of
ARTICLE II.
Eurofoil shall mean Eurofoil Inc. (USA), a New York corporation.
European Administrative Borrower shall mean Novelis AG, or any successor entity serving in
that role pursuant to Section 2.03(c).
European Borrower shall mean Swiss Borrower and U.K. Borrower.
European Borrowing Base shall mean the lesser of (i) (A) the sum of the Swiss Borrowing Base
plus (B) the U.K. Borrowing Base and (ii) the greater of (A) $350,000,000 and (B) 40% of
the Total Gross Borrowing Base.
European Communities shall mean the European Community created by the Treaty establishing
the European Community (Treaty of Rome) of 1957.
European LC Exposure shall mean at any time the Dollar Equivalent of the sum of the stated
amount of all outstanding European Letters of Credit at such time. The European LC Exposure of any
Revolving Lender at any time shall mean its Pro Rata Percentage of the aggregate European LC
Exposure at such time.
European Letter of Credit shall have the meaning assigned to such term in Section
2.18(a).
European Reimbursement Obligations shall mean each applicable Borrowers obligations under
Section 2.18 to reimburse LC Disbursements in respect of European Letters of Credit.
European Swingline Commitment shall mean the commitment of the European Swingline Lender to
make loans pursuant to Section 2.17, as the same may be reduced from time to time pursuant
to Section 2.07 or Section 2.17. The amount of the European Swingline Commitment
shall initially be $25,000,000, but shall in no event exceed the Revolving Commitment.
European Swingline Exposure shall mean at any time the aggregate principal amount at such
time of all outstanding European Swingline Loans. The European Swingline Exposure of any Revolving
Lender at any time shall equal its Pro Rata Percentage of the aggregate European Swingline Exposure
at such time.
38
European Swingline Lender shall have the meaning assigned to such term in the preamble
hereto.
European Swingline Loan shall mean any loan made by the European Swingline Lender pursuant
to Section 2.17. For the avoidance of doubt, European Swingline Loans shall include
Overadvances made as European Swingline Loans.
Event of Default shall have the meaning assigned to such term in Section 8.01.
Excess Amount shall have the meaning assigned to such term in Section 2.10.
Excess Availability shall mean, at any time, an amount, expressed in Dollars, equal to (a)
the lesser of (i) the Revolving Commitments of all of the Lenders and (ii) the Total Borrowing Base
on the date of determination less (b) all outstanding Loans and LC Exposure.
Exchange Act shall mean the Securities Exchange Act of 1934, as amended.
Excluded Collateral Subsidiary shall mean, at any date of determination, any Restricted
Subsidiary designated as such in writing by Administrative Borrower to the Administrative Agent
that:
(x) (i) contributed 2.5% or less of Consolidated EBITDA (Leverage) for the period of four
fiscal quarters most recently ended for which financial statements have been or are required
to have been delivered pursuant to Section 5.01(a) or 5.01(b) prior to the
date of determination, and (ii) had consolidated assets representing 2.5% or less of the
Consolidated Total Assets of the Parent Borrower and its Restricted Subsidiaries on the last
day of the most recent fiscal quarter ended for which financial statements have been or are
required to have been delivered pursuant to Section 5.01(a) or 5.01(b) prior
to the date of determination;
(y) together with all other Restricted Subsidiaries constituting Excluded Collateral
Subsidiaries (i) contributed 7.5% or less of Consolidated EBITDA (Leverage) for the period
of four fiscal quarters most recently ended for which financial statements have been or are
required to have been delivered pursuant to Section 5.01(a) or 5.01(b) prior
to the date of determination, and (ii) had consolidated assets representing 7.5% or less of
the Consolidated Total Assets of the Parent Borrower and its Restricted Subsidiaries on the
last day of the most recent fiscal quarter ended for which financial statements have been or
are required to have been delivered pursuant to Section 5.01(a) or 5.01(b)
prior to the date of determination, and
(z) is not a Loan Party on the Closing Date; provided that no Loan Party shall
constitute an Excluded Collateral Subsidiary except to the extent such Loan Party issues
Equity Interests to Persons other than a Company pursuant to Section 6.06(l) and immediately
prior to such issuance such Person would have otherwise qualified as an Excluded Collateral
Subsidiary under clause (x) and (y) above.
The Excluded Collateral Subsidiaries as of the Closing Date are listed on Schedule
1.01(e).
39
Excluded Contract shall have the meaning assigned to such term in the definition of
Excluded Property.
Excluded Equity Interests shall mean (a) any Equity Interests of any Person with respect to
which the cost or other consequences (including any adverse tax consequences) of pledging such
Equity Interests shall be excessive in view of the benefits to be obtained by the Lenders therefrom
as reasonably determined by the Administrative Agent and the Administrative Borrower, (b) any
Equity Interests to the extent the pledge thereof would be prohibited by any applicable law or
contractual obligation (only to the extent such prohibition is applicable and not rendered
ineffective by any applicable law and, in the case of any such contractual obligation, permitted
under Section 6.19 hereof) and (c) the Equity Interests of any Unrestricted Subsidiary.
Excluded Property shall mean (a) any Excluded Equity Interests, (b) any property, including
the rights under any contract or agreement (an Excluded Contract) to the extent that the grant of
a Lien thereon (i) is prohibited by applicable law or contractual obligation, (ii) requires a
consent not obtained of any governmental authority pursuant to such applicable law or any third
party pursuant to any contract between the Parent Borrower or any Subsidiary and such third party
or (iii) would trigger a termination event pursuant to any change of control or similar
provision, in each case pursuant to this clause (a), except to the extent such anti-assignment or
negative pledge is not enforceable under the UCC or other applicable requirements of Applicable
Law, or such contractual obligation is prohibited under Section 6.19 hereof, (b) United
States intent to use trademark applications to the extent that, and solely during the period in
which, the grant of a Lien thereon would impair the validity or enforceability of such intent to
use trademark applications under applicable United States federal law, (c) local petty cash deposit
accounts maintained by the Parent Borrower and its Restricted Subsidiaries in proximity to their
operations, (d) payroll accounts maintained by the Parent Borrower and its Subsidiaries, (e)
Property that is, or is to become, subject to a Lien securing a Purchase Money Obligation or
Capital Lease Obligation permitted to be incurred pursuant to this Agreement, if the contract or
other agreement in which such Lien is granted (or the documentation providing for such Purchase
Money Obligation or Capital Lease Obligation) validly prohibits the creation of any other Lien on
such Property and such prohibition is permitted under Section 6.19 hereof, (f)(x) any
leasehold real property and (y) any fee-owned real property having an individual fair market value
not exceeding $10,000,000, (g) any Letter-of-Credit Rights that are not Supporting Obligations
(each as defined in the UCC), and (h) any other property with respect to which the cost or other
consequences (including any materially adverse tax consequences) of pledging such property shall be
excessive in view of the benefits to be obtained by the Lenders therefrom as reasonably determined
by the Administrative Agent.
Excluded Subsidiaries shall mean Restricted Subsidiaries of Holdings that are not organized
in a Principal Jurisdiction.
Excluded Taxes shall mean, with respect to the Agents, any Lender, any Issuing Bank or any
other recipient of any payment to be made by or on account of any obligation of any Borrower
hereunder, (a) taxes imposed on or measured by its overall net income (however denominated),
franchise taxes imposed on it (in lieu of net income taxes) and branch profits taxes imposed on it,
by a jurisdiction (or any political subdivision thereof) as a result of the recipient being
organized or having its principal office or, in the case of any Lender, its applicable lending
40
office in such jurisdiction, (b) in the case of a Foreign Lender, any U.S. federal withholding
tax that (i) is imposed on amounts payable to such Foreign Lender at the time such Foreign Lender
becomes a party hereto (or designates a new lending office), except (x) to the extent that such
Foreign Lender (or its assignor, if any) was entitled, at the time of designation of a new lending
office (or assignment), to receive additional amounts from any Borrower with respect to such
withholding tax pursuant to Section 2.15(a) or (y) if such Foreign Lender
designates a new foreign lending office or is an assignee pursuant to a request by any Borrower
under Section 2.15(l); provided that this subclause (b)(i) shall not apply to any Tax
imposed on a Lender in connection with an interest or participation in any Loan or other obligation
that such Lender was required to acquire pursuant to Section 2.14(d), or (ii) is
attributable to such Foreign Lenders failure to comply with Section 2.15(e), (c)
withholding taxes imposed under FATCA and (d) for greater certainty, taxes imposed on amounts
deemed to be interest pursuant to section 214(7) of the Income Tax Act (Canada).
Executive Order shall have the meaning assigned to such term in Section 3.22.
Existing Commerzbank Letter of Credit shall mean the letters of credit referred to on
Schedule 2.18(b).
Existing Letter of Credit shall mean the letters of credit referred to on Schedule
2.18(a), in each case that is issued by a Lender or an Affiliate of a Lender that is eligible
to be an Issuing Bank.
Existing Lien shall have the meaning assigned to such term in Section 6.02(c).
Existing Senior Note Agreements shall mean the collective reference to (i) the indenture
dated as of February 3, 2005, pursuant to which the Existing 2005 Senior Notes were issued and (ii)
the indenture dated as of August 11, 2009, pursuant to which the Existing 2009 Senior Notes were
issued.
Existing Senior Note Documents shall mean the Existing Senior Notes, the Existing Senior
Note Agreements, the Existing Senior Note Guarantees and all other documents executed and delivered
with respect to either Existing Senior Notes or the Existing Senior Note Agreements.
Existing Senior Note Guarantees shall mean the guarantees pursuant to either Existing Senior
Note Agreement.
Existing Senior Notes shall mean the collective reference to the Existing 2005 Senior Notes
and the Existing 2009 Senior Notes.
Existing 2005 Senior Notes shall mean the Parent Borrowers 7-1/4% Senior Notes due 2015
issued pursuant to the Existing Senior Note Agreements.
Existing 2009 Senior Notes shall mean the Parent Borrowers 11.5% Senior Notes due 2015
issued pursuant to the Existing Senior Note Agreements.
41
Extended Commitment shall have the meaning assigned to such term in Section
11.02(g).
Extraordinary Expenses shall mean all costs, expenses or advances that any Agent or Receiver
may incur during a Default or Event of Default, or during the pendency of an Insolvency Proceeding
of a Loan Party, including those relating to (a) any audit, inspection, repossession, storage,
repair, appraisal, insurance, manufacture, preparation or advertising for sale, sale, collection,
or other preservation of or realization upon any Collateral; (b) any action, arbitration or other
proceeding (whether instituted by or against any Agent, any Lender, any Receiver, any Loan Party,
any representative of creditors of any Loan Party or any other Person) in any way relating to any
Collateral (including the validity, perfection, priority or avoidability of the Liens on the
Collateral for the benefit of the Secured Parties), Loan Documents, Letters of Credit or Secured
Obligations, including any lender liability or other Claims; (c) the exercise, protection or
enforcement of any rights or remedies of any Agent or Receiver in, or the monitoring of, any
Insolvency Proceeding; (d) settlement or satisfaction of any taxes, charges or Liens with respect
to any Collateral; (e) any Enforcement Action; (f) negotiation and documentation of any
modification, waiver, workout, restructuring or forbearance with respect to any Loan Documents or
Secured Obligations; and (g) Protective Advances. Such costs, expenses and advances include
transfer fees, Other Taxes, storage fees, insurance costs, permit fees, utility reservation and
standby fees, legal fees, appraisal fees, brokers fees and commissions, auctioneers fees and
commissions, accountants fees, environmental study fees, wages and salaries paid to employees of
any Loan Party or independent contractors in liquidating any Collateral, and travel expenses.
FASB ASC shall mean the Accounting Standards Codification of the Financial Accounting
Standards Board.
FATCA means Sections 1471 through 1474 of the Code in effect as of the date hereof (or any
amended or successor provisions that are substantively comparable) and any regulations thereunder
and official interpretations thereof.
Federal Funds Rate shall mean (a) the weighted average of interest rates on overnight
federal funds transactions with members of the Federal Reserve System arranged by federal funds
brokers on the applicable Business Day (or on the preceding Business Day, if the applicable day is
not a Business Day), as published by the Federal Reserve Bank of New York on the next Business Day;
or (b) if no such rate is published on the next Business Day, the average rate (rounded up, if
necessary, to the nearest 1/8 of 1%) charged to Bank of America on the applicable day on such
transactions, as determined by Agent.
Fee Letter shall mean that certain fee letter among the Parent Borrower, Bank of America,
Merrill Lynch, Pierce, Fenner & Smith Incorporated, and the other commitment parties party thereto,
dated as of December 6, 2010.
Fees shall mean the fees payable hereunder or under the Fee Letter.
Financial Officer of any person shall mean the chief financial officer, principal accounting
officer, treasurer or controller of such person.
42
Financial Support Direction shall mean a financial support direction issued by the Pensions
Regulator under Section 43 of the Pensions Act 2004.
FIRREA shall mean the Federal Institutions Reform, Recovery and Enforcement Act of 1989, as
amended.
First Priority shall mean, with respect to any Lien purported to be created in any
Collateral pursuant to any Security Document, that such Lien is the most senior Lien to which such
Collateral is subject, other than Permitted Liens of the type described in Section 6.02(a),
(b), (c), (d), (f), (g), (h), (i),
(j), (k) (to the extent provided in the Intercreditor Agreement), (n),
(o), (q), (r), (s), (t) and (y) which have priority
over the Liens granted pursuant to the Security Documents (and in each case, subject to the proviso
to Section 6.02).
Foreign Guarantee shall have the meaning assigned to such term in Section 7.01.
Foreign Lender shall mean any Lender that is not, for United States federal income tax
purposes, (i) an individual who is a citizen or resident of the United States, (ii) a corporation,
partnership or other entity treated as a corporation or partnership created or organized in or
under the laws of the United States, or any political subdivision thereof, (iii) an estate whose
income is subject to U.S. federal income taxation regardless of its source or (iv) a trust if a
court within the United States is able to exercise primary supervision over the administration of
such trust and one or more United States persons have the authority to control all substantial
decisions of such trust or a trust that properly elected to be treated as a United States person.
Foreign Plan shall mean any pension or other employee benefit or retirement plan, program,
policy, arrangement or agreement maintained or contributed to by any Company with respect to
employees employed outside the United States.
Foreign Subsidiary shall mean a Subsidiary that is organized under the laws of a
jurisdiction other than the United States or any state thereof or the District of Columbia.
Forward Share Sale Agreement shall mean that certain Forward Share Sale Agreement, dated as
of December 17, 2010, between Novelis Inc. and Novelis Acquisitions LLC pursuant to which Novelis
Inc. has agreed to sell shares of 9.50% preferred stock of Novelis Corporation owned by it to
Novelis Acquisitions LLC.
French Collateral Agent shall mean Bank of America, N.A., in its capacity as security agent
(agent des sûretés), under the French Security Agreements and any of its successors or assigns.
For the avoidance of doubt, the French Collateral Agent is hereby appointed by the Lenders to act
on their behalf as security agent (agent des sûretés) to constitute, register, manage and execute
the security interests contemplated by the French Security Agreements in order to fully secure and
guarantee their respective rights in each amount payable by each French Guarantor to each of the
Secured Parties under each of the Loan Documents, and in that capacity to accomplish all actions
and formalities eventually necessary under article 2328-1 of the French code civil.
French Guarantor shall mean each Restricted Subsidiary of Parent Borrower organized in
France party hereto as a Guarantor, and each other Restricted Subsidiary of Parent
43
Borrower organized in France that is required to become a Guarantor pursuant to the terms
hereof.
French Security Agreements shall mean, collectively, any Security Agreements substantially
in the form of Exhibit M-10, including all subparts thereto, among the French Guarantor and
the French Collateral Agent for the benefit of the Secured Parties.
Fronting Fee shall have the meaning assigned to such term in Section 2.05(c).
Full Payment shall mean, with respect to any Secured Obligations, (a) the full and
indefeasible cash payment thereof, including any interest, fees and other charges accruing during
an Insolvency Proceeding (whether or not allowed in the proceeding); (b) if such Secured
Obligations are LC Obligations or inchoate or contingent in nature, cash collateralization thereof
(or delivery of a standby letter of credit acceptable to Administrative Agent in its discretion, in
the amount of required cash collateral) in an amount equal to (x) 105% of all LC Exposure and (y)
with respect to any inchoate, contingent or other Secured Obligations (including Secured Bank
Product Obligations), Administrative Agents good faith estimate of the amount due or to become
due, including all fees and other amounts relating to such Secured Obligations; and (c) a release
of any Claims of the Loan Parties against each Agent, Lenders and each Issuing Bank arising on or
before the payment date. No Loans shall be deemed to have been paid in full until all Commitments
related to such Loans have expired or been terminated.
Fund shall mean any Person (other than a natural Person) that is (or will be) engaged in
making, purchasing, holding or otherwise investing in commercial loans and similar extensions of
credit in the ordinary course of its activities.
Funded Debt shall mean, as to any person, all Indebtedness of such person that matures more
than one year from the date of its creation or matures within one year from such date but is
renewable or extendible, at the option of such person, to a date more than one year from such date
or arises under a revolving credit or similar agreement that obligates the lender or lenders to
extend credit during a period of more than one year from such date, including all current
maturities and current sinking fund payments in respect of such Indebtedness whether or not
required to be paid within one year from the date of its creation and, in the case of the Parent
Borrower and its Subsidiaries, Indebtedness in respect of the Loans and the Term Loans.
GAAP shall mean generally accepted accounting principles in the United States applied on a
consistent basis; provided that if the Parent Borrower converts its financial reporting
from generally accepted accounting principles in the United States to IFRS as permitted under
Section 1.04, GAAP shall mean (subject to the provisions of Section 1.04 hereof)
IFRS applied on a consistent basis.
GBP or £ shall mean lawful money of the United Kingdom.
GBP Denominated Loan shall mean each Loan denominated in GBP at the time of the incurrence
thereof.
German Guarantor shall mean each Restricted Subsidiary of Parent Borrower organized in
Germany party hereto as a Guarantor, and each other Restricted Subsidiary of
44
Parent Borrower organized in Germany that is required to become a Guarantor pursuant to the
terms hereof.
German Receivables Purchase Agreement shall have the meaning assigned to such term in the
definition of Receivables Purchase Agreement.
German Security Agreement shall mean, collectively, any Security Agreement substantially in
the form of Exhibit M-5, including all subparts thereto, among the German Guarantors and
the Collateral Agent and/or the Term Loan Collateral Agent, among others, for the benefit of the
Secured Parties.
German Seller shall mean Novelis Deutschland GmbH, a company organized under the laws of
Germany (including in its roles as seller and collection agent under the German Receivables
Purchase Agreement).
Governmental Authority shall mean the government of the United States or any other nation,
or of any political subdivision thereof, whether state, provincial or local, and any agency,
authority, instrumentality, regulatory body, court, central bank or other entity exercising
executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or
pertaining to government (including any supra-national bodies such as the European Union or the
European Central Bank).
Governmental Real Property Disclosure Requirements shall mean any requirement of Applicable
Law of any Governmental Authority requiring notification of the buyer, lessee, mortgagee, assignee
or other transferee of any Real Property, facility, establishment or business, or notification,
registration or filing to or with any Governmental Authority, in connection with the sale, lease,
mortgage, assignment or other transfer (including any transfer of control) of any Real Property,
facility, establishment or business, of the actual or threatened presence or Release in or into the
Environment, or the use, disposal or handling of Hazardous Material on, at, under or near the Real
Property, facility, establishment or business to be sold, leased, mortgaged, assigned or
transferred.
Guarantee Payment shall have the meaning assigned to such term in Section 7.12(b).
Guaranteed Obligations shall have the meaning assigned to such term in Section 7.01.
Guarantees shall mean the guarantees issued pursuant to ARTICLE VII by the
Guarantors.
Guarantors shall mean each Borrower, Holdings and the Subsidiary Guarantors (including each
U.S. Borrower, the Parent Borrower, the U.K. Borrower, the Swiss Borrower, Holdings and each other
Canadian Guarantor, each Swiss Guarantor, each U.K. Guarantor, the German Guarantor, each Irish
Guarantor, the Brazilian Guarantor, the Luxembourg Guarantor, the Madeira Guarantor, the French
Guarantor, and each other Restricted Subsidiary of Parent Borrower that becomes or is required to
become a Guarantor hereunder, and including in any case each Borrowing Base Guarantor).
45
Hazardous Materials shall mean the following: hazardous substances; hazardous wastes;
polychlorinated biphenyls (PCBs) or any substance or compound containing PCBs; asbestos or any
asbestos-containing materials in any form or condition; radon or any other radioactive materials
including any source, special nuclear or by-product material; petroleum, crude oil or any fraction
thereof; and any other pollutant or contaminant or chemicals, wastes, materials, compounds,
constituents or substances, subject to regulation under or which can give rise to liability
(including, but not limited to, due to their ignitability, corrosivity, reactivity or toxicity)
under any Environmental Laws.
Hedging Agreement shall mean any swap, cap, collar, forward purchase or similar agreements
or arrangements dealing with interest rates, currency exchange rates or commodity prices, either
generally or under specific contingencies entered into for the purposes of hedging a Companys
exposure to interest or exchange rates, loan credit exchanges, security or currency valuations or
commodity prices, in each case not for speculative purposes.
Hedging Obligations shall mean obligations under or with respect to Hedging Agreements.
Hindalco shall mean Hindalco Industries Limited, a corporation organized under the laws of
India.
HMRC DT Treaty Passport Scheme shall mean the Double Taxation Treaty Passport Scheme as
implemented by HM Revenue & Customs from September 1, 2010, in relation to corporate lenders.
Holdings shall mean (i) prior to the consummation of the Permitted Holdings Amalgamation, AV
Metals, and (ii) upon and after the consummation of the Permitted Holdings Amalgamation, Successor
Holdings.
IFRS shall mean International Financial Reporting Standards consistently applied.
Immaterial Subsidiary shall mean, at any date of determination, any Subsidiary that,
together with all other Subsidiaries then constituting Immaterial Subsidiaries (i) contributed 5.0%
or less of Consolidated EBITDA for the period of four fiscal quarters most recently ended for which
financial statements have been or are required to have been delivered pursuant to Section
5.01(a) or 5.01(b) prior to the date of determination, (ii) had consolidated assets
representing 5.0% or less of the Consolidated Total Assets on the last day of the most recent
fiscal quarter ended for which financial statements have been or are required to have been
delivered pursuant to Section 5.01(a) or 5.01(b) prior to the date of
determination, and (iii) is not a Loan Party on the Closing Date.
Increase Effective Date shall have the meaning assigned to such term in Section
2.23(a).
Increase Joinder shall have the meaning assigned to such term in Section 2.23(c).
Incremental Revolving Commitment shall have the meaning assigned to such term in Section
2.23(a).
46
Indebtedness of any person shall mean, without duplication, (a) all obligations of such
person for borrowed money or advances; (b) all obligations of such person evidenced by bonds,
debentures, notes or similar instruments; (c) all obligations of such person under conditional sale
or other title retention agreements relating to property purchased by such person; (d) all
obligations of such person issued or assumed as the deferred purchase price of property or services
(excluding trade accounts payable and accrued obligations incurred in the ordinary course of
business on normal trade terms and not overdue by more than ninety (90) days (other than such
overdue trade accounts payable being contested in good faith and by proper proceedings, for which
appropriate reserves are being maintained with respect to such circumstances in accordance with
U.S. GAAP or other applicable accounting standards)); (e) all Indebtedness of others secured by any
Lien on property owned or acquired by such person, whether or not the obligations secured thereby
have been assumed, but limited to the fair market value of such property; (f) all Capital Lease
Obligations, Purchase Money Obligations and Synthetic Lease Obligations of such person; (g) all
Hedging Obligations to the extent required to be reflected on a balance sheet of such person; (h)
all Attributable Indebtedness of such person; (i) all obligations of such person for the
reimbursement of any obligor in respect of letters of credit, letters of guaranty, bankers
acceptances and similar credit transactions; (j) all obligations of such person under any Qualified
Securitization Transaction; and (k) all Contingent Obligations of such person in respect of
Indebtedness or obligations of others of the kinds referred to in clauses (a) through (j) above.
The Indebtedness of any person shall include the Indebtedness of any other entity (including any
partnership in which such person is a general partner) to the extent such person is liable therefor
as a result of such persons ownership interest in or other relationship with such entity, except
(other than in the case of general partner liability) to the extent that the terms of such
Indebtedness expressly provide that such person is not liable therefor.
Indemnified Taxes shall mean all Taxes other than Excluded Taxes and Other Taxes.
Indemnitee shall mean Agent Indemnitees, Lender Indemnitees, Issuing Bank Indemnitees, Bank
of America Indemnitees and Receiver Indemnitees.
Indenture Permitted Debt shall mean permitted debt of the type referred to in clause (b) of
the definition of Permitted Debt contained in the New Senior Notes Agreements (or equivalent
basket in any other Material Indebtedness).
Information shall have the meaning assigned to such term in Section 11.12.
Initial Issuing Bank shall mean Bank of America, N.A. as initial Issuing Bank, and its
successors in such capacity pursuant to Section 2.18(d), in its capacity as issuer of U.S.
Letters of Credit and European Letters of Credit issued by it.
Initial U.S. Borrower shall have the meaning assigned to such term in the preamble hereto.
Initiating Company shall have the meaning assigned to such term in the definition of Series
of Cash Neutral Transactions.
47
Insolvency Proceeding any case or proceeding commenced by or against a Person under any
state, federal or foreign law for, or any agreement of such Person to, (a) the entry of an order
for relief under the Bankruptcy Code, or any other Debtor Relief Law; (b) the appointment of a
receiver, trustee, liquidator, administrator, examiner, conservator or other custodian for such
Person or any part of its property; or (c) an assignment or trust mortgage for the benefit of
creditors.
Instruments shall mean all instruments, as such term is defined in the UCC, in which any
Person now or hereafter has rights.
Insurance Policies shall mean the insurance policies and coverages required to be maintained
by each Loan Party which is an owner of Mortgaged Property with respect to the applicable Mortgaged
Property pursuant to Section 5.04 and all renewals and extensions thereof.
Insurance Requirements shall mean, collectively, all provisions of the Insurance Policies,
all requirements of the issuer of any of the Insurance Policies and all orders, rules, regulations
and any other requirements of the National Board of Fire Underwriters (or any other body exercising
similar functions) binding upon each Loan Party which is an owner of Mortgaged Property and
applicable to the Mortgaged Property or any use or condition thereof.
Intellectual Property shall have the meaning assigned to such term in Section
3.06(a).
Interbank Rate shall mean, for any period, (i) in respect of Loans denominated in Dollars,
the Federal Funds Rate, and (ii) in respect of Loans denominated in any other currency, the
Administrative Agents cost of funds for such period.
Intercompany Note shall mean a promissory note substantially in the form of Exhibit
P, or such other form as may be agreed to by the Administrative Agent in its sole discretion.
Intercreditor Agreement shall mean that certain Intercreditor Agreement, dated as of the
date hereof, by and among the Companies party thereto, Administrative Agent, Collateral Agent, the
Term Loan Collateral Agent, the Term Loan Administrative Agent, and such other persons as may
become party thereto from time to time pursuant to the terms thereof, as the same may be amended,
restated, supplemented or otherwise modified from time to time.
Interest Election Request shall mean a request by Administrative Borrower to convert or
continue a Borrowing in accordance with Section 2.08(b), substantially in the form of
Exhibit E.
Interest Payment Date shall mean (a) with respect to any Base Rate Loan (including any
Swingline Loan), the first Business Day of each month to occur during any period in which such Loan
is outstanding, (b) with respect to any Eurocurrency Loan or EURIBOR Loan, the last day of the
Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a
Eurocurrency Loan or EURIBOR Loan with an Interest Period of more than three months duration, each
day prior to the last day of such Interest Period that occurs at intervals of three months
duration after the first day of such Interest Period, and (c) with respect to any
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Revolving Loan or
Swingline Loan, the Maturity Date thereof or such earlier date on which the Revolving Commitments
are terminated, as the case may be.
Interest Period shall mean (a) in the case of any Eurocurrency Loan, the applicable
Eurocurrency Interest Period and (b) in the case of any EURIBOR Loan, the applicable EURIBOR
Interest Period.
Inventory shall mean all inventory, as such term is defined in the UCC, wherever located,
in which any Person now or hereafter has rights.
Inventory Appraisal shall mean (a) on the Closing Date, the appraisal prepared by Sector 3
dated July 2010, and (b) thereafter, the most recent inventory appraisal conducted by an
independent appraisal firm and delivered pursuant to Section 5.07(c) hereof.
Inventory Reserve shall mean reserves established by Administrative Agent in its Permitted
Discretion in accordance with Section 2.01(d) to reflect factors that may negatively impact
the value of Inventory, including change in salability, obsolescence (excluding items that can be
recycled as scrap), seasonality, theft, shrinkage, imbalance, change in composition or mix,
markdowns and vendor chargebacks.
Investments shall have the meaning assigned to such term in Section 6.04.
Irish Guarantor shall mean each Restricted Subsidiary of Parent Borrower organized in
Ireland party hereto as a Guarantor, and each other Restricted Subsidiary of Parent Borrower
organized in Ireland that is required to become a Guarantor pursuant to the terms hereof.
Irish Security Agreement shall mean, collectively, any Security Agreement substantially in
the form of Exhibit M-6, including all subparts thereto, among the Irish Guarantors and the
Collateral Agent, among others, for the benefit of the Secured Parties.
Issuing Bank shall mean, as the context may require, (a) the Initial Issuing Bank; (b) any
other Lender that is a Swiss Qualifying Bank that may become an Issuing Bank pursuant to
Section 2.18(d) or (e) in its capacity as issuer of U.S. Letters of Credit and
European Letters of Credit issued by such Lender; (c) any other Lender that may become an Issuing
Bank pursuant to Section 2.18(f), but solely in its capacity as issuer of Existing Letters
of Credit; (e) Commerzbank, solely in its capacity as issuer of Existing Commerzbank Letters of
Credit; or (e) collectively, all of the foregoing. Any Issuing Bank may, in its discretion,
arrange for one or more U.S. Letters of Credit or European Letters of Credit to be issued by
Affiliates of such Issuing Bank (so long as each such Affiliate is a Swiss Qualifying Bank), in
which case the term Issuing Bank shall include any such Affiliate with respect to Letters of
Credit issued by such Affiliate.
Issuing Bank Indemnitees shall mean each Issuing Bank and their officers, directors,
employees, Affiliates, agents and attorneys.
Issuing Country shall have the meaning assigned to such term in Section 11.19(a).
49
Joinder Agreement shall mean a joinder agreement substantially in the form of Exhibit
F, or such other form as may be agreed to by the Administrative Agent in its sole discretion.
Joint Venture shall mean any person (a) that is not a direct or indirect Subsidiary of
Holdings, and (b) in which Parent Borrower, in the aggregate, together with its Subsidiaries, is
directly or indirectly, the beneficial owner of 5% or more of any class of Equity Interests of such
person.
Joint Venture Subsidiary shall mean each of (i) Aluminum Company of Malaysia Berhard, (ii)
NKL and (iii) any other person that is a Subsidiary in which persons other than Holdings or its
Affiliates own 10% or more of the Equity Interests of such person, excluding, to the extent they
become Restricted Subsidiaries of the Parent Borrower after the Closing Date, Logan and Norf GmbH.
Judgment Currency shall have the meaning assigned to such term in Section 11.18(a).
Judgment Currency Conversion Date shall have the meaning assigned to such term in
Section 11.18(a).
Junior Lien means a Lien designated as a Subordinated Lien under the Intercreditor
Agreement on all or any portion of the Collateral, but only to the extent (i) any such Lien
constitutes Subordinated Liens under, and as defined in, the Intercreditor Agreement (it being
understood that such Subordinated Lien will be a junior, silent lien with respect to the Liens
securing the Secured Obligations, as provided in the Intercreditor Agreement) and (ii) the holders
of such Indebtedness (or a trustee, agent or other representative of such holders) secured by such
Lien have become a party to the Intercreditor Agreement through the execution and delivery of
joinders thereto.
Junior Secured Indebtedness shall mean Indebtedness of a Loan Party that is secured by a
Junior Lien.
Junior Secured Indebtedness Documents all documents executed and delivered with respect to
the Junior Secured Indebtedness or delivered in connection therewith.
Land Registry shall mean the Land Registry of England and Wales.
Landlord Access Agreement shall mean a Landlord Access Agreement, substantially in the form
of Exhibit G, or such other form as may reasonably be acceptable to the Administrative
Agent.
LC Application shall mean an application to an Issuing Bank for issuance of a Letter of
Credit in accordance with the terms of Section 2.18, in form and substance satisfactory to
such Issuing Bank.
LC Commitment shall mean the commitment of the Initial Issuing Bank to issue U.S. Letters of
Credit and European Letters of Credit pursuant to Section 2.18. The total amount of
50
the LC
Commitment shall initially be $125,000,000, but shall in no event exceed the Total Revolving
Commitment.
LC Condition shall mean the following conditions necessary for issuance of a Letter of
Credit: (a) each of the conditions set forth in Section 4.02 (and, in the case of the
initial Credit
Extension, Section 4.01); (b) after giving effect to such issuance, (i) the LC
Exposure does not exceed the LC Commitment, the Total Revolving Exposure does not exceed the lesser
of (A) the Total Borrowing Base and (B) the Total Revolving Commitments, (ii) the Total Adjusted
Revolving Exposure does not exceed the Total Adjusted Borrowing Base and (iii) no Overadvance
exists; (c) the expiration date of such Letter of Credit is no more than 365 days from issuance,
provided that such Letters of Credit may contain automatic extension provisions in
accordance with Section 2.18(a)(v); (d) the purpose and form of the proposed Letter of
Credit is satisfactory to Administrative Agent and the applicable Issuing Bank in their discretion,
(e) where the Letter of Credit is a Standby Letter of Credit, the beneficiary of such Letter of
Credit is not resident in Ireland or, where the beneficiary is a legal person, its place of
establishment to which the Letter of Credit relates is not in Ireland, and (f) the Applicable
Administrative Borrower (or, with respect to Canadian Dollar Denominated Letters of Credit, Parent
Borrower) shall be a co-applicant, and therefore jointly and severally liable, with respect to each
Letter of Credit issued for the account of another Subsidiary of Holdings.
LC Disbursement shall mean a payment or disbursement made by the applicable Issuing Bank
pursuant to a drawing under a Letter of Credit.
LC Documents shall mean all documents, instruments and agreements (including LC Requests and
LC Applications) delivered by Borrowers or any other Person to an Issuing Bank or an Agent in
connection with issuance, amendment or renewal of, or payment under, any Letter of Credit.
LC Exposure shall mean, at any time, the sum of the U.S. LC Exposure and European LC
Exposure at such time.
LC Obligations shall mean the sum (without duplication) of (a) all amounts owing by
Borrowers for any drawings under Letters of Credit; (b) the stated amount of all outstanding
Letters of Credit; and (c) all fees and other amounts owing with respect to Letters of Credit.
LC Participation Fee shall have the meaning assigned to such term in Section
2.05(c).
LC Request shall mean a request in accordance with the terms of Section 2.18 and
substantially in the form of Exhibit H, or such other form as shall be approved by the
Administrative Agent.
Leases shall mean any and all leases, subleases, tenancies, options, concession agreements,
rental agreements, occupancy agreements, franchise agreements, access agreements and any other
agreements (including all amendments, extensions, replacements, renewals, modifications and/or
guarantees thereof), whether or not of record and whether now in existence or hereafter entered
into, affecting the use or occupancy of all or any portion of any Real Property.
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Lender Indemnitees shall mean the Lenders and their officers, directors, employees,
Affiliates, agents and attorneys.
Lenders shall mean (a) each financial institution that is a party hereto on the date hereof
or that becomes a party hereto pursuant to an Increase Joinder and (b) any financial
institution that has become a party hereto pursuant to an Assignment and Assumption, other
than, in each case, any such financial institution that has ceased to be a party hereto pursuant to
an Assignment and Assumption. Unless the context clearly indicates otherwise, the term Lenders
shall include each Swingline Lender.
Letter of Credit shall mean any (i) Standby Letter of Credit, (ii) Commercial Letter of
Credit, and (iii) any indemnity, guarantee, exposure transmittal memorandum or similar form of
credit support for the benefit of the any Borrower, in each case, issued (or deemed issued) or to
be issued by an Issuing Bank for the account of any Borrower pursuant to Section 2.18,
including any U.S. Letter of Credit and any European Letter of Credit.
Letter of Credit Expiration Date shall mean the date which is ten (10) days prior to the
Maturity Date.
LIBOR shall mean, for any Interest Period with respect to a Eurocurrency Borrowing, the per
annum rate of interest (rounded up, if necessary, to the nearest 1/8th of 1%), determined by
Administrative Agent at approximately 11:00 a.m. (London time) two Business Days prior to
commencement of such Interest Period, for a term comparable to such Interest Period, equal to (a)
the British Bankers Association LIBOR Rate (BBA LIBOR), as published by Reuters (or other
commercially available source designated by Administrative Agent); or (b) if BBA LIBOR is not
available for any reason, the interest rate at which deposits in the relevant Approved Currency in
the approximate amount of the Eurocurrency Borrowing would be offered by Bank of Americas London
branch to major banks in the London interbank Eurodollar market.
Lien shall mean, with respect to any property, (a) any mortgage, deed of trust, lien,
pledge, encumbrance, charge, assignment, hypothecation, security interest or similar encumbrance of
any kind or any arrangement to provide priority or preference in respect of such property or any
filing of any financing statement or any financing change statement under the UCC, the PPSA or any
other similar notice of lien under any similar notice or recording statute of any Governmental
Authority (other than any unauthorized notice or filing filed after the Closing Date for which
there is not otherwise any underlying lien or obligation, so long as the Borrowers are (if aware of
same) using commercially reasonable efforts to cause the removal of same), including any easement,
right-of-way or other encumbrance on title to Real Property, in each of the foregoing cases whether
voluntary or imposed by law, and any agreement to give any of the foregoing; (b) the interest of a
vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement
(or any financing lease having substantially the same economic effect as any of the foregoing)
relating to such property; and (c) in the case of securities, any purchase option, call or similar
right of a third party with respect to such securities.
Loan Documents shall mean this Agreement, any Borrowing Base Certificate, the Intercreditor
Agreement, the Contribution, Intercompany, Contracting and Offset Agreement, the Notes (if any),
the Security Documents, each Foreign Guarantee, the Fee Letter, and all other
52
pledges, powers of
attorney, consents, assignments, certificates, agreements or documents, whether heretofore, now or
hereafter executed by or on behalf of any Loan Party for the benefit of any Agent or any Lender in
connection with this Agreement.
Loan Modification Agreement shall have the meaning assigned to such term in Section
11.02(g).
Loan Modification Offer shall have the meaning assigned to such term in Section
11.02(g).
Loan Parties shall mean Holdings (unless Holdings has been released as a Guarantor pursuant
to Section 7.09(d)), the Borrowers and the Subsidiary Guarantors.
Loans shall mean, as the context may require, a Revolving Loan or a Swingline Loan.
Logan shall mean Logan Aluminum Inc., a Delaware corporation.
Logan Location shall mean the premises of Logan Aluminum Inc., Route 431, North
Russellville, Kentucky 42276.
Luxembourg Company Act shall have the meaning assigned to such term in Section
7.16(a).
Luxembourg Guarantor shall mean each Restricted Subsidiary of Parent Borrower organized in
Luxembourg party hereto as a Guarantor, and each other Restricted Subsidiary of Parent Borrower
organized in Luxembourg that is required to become a Guarantor pursuant to the terms hereof.
Luxembourg Security Agreements shall mean, collectively, any Security Agreements
substantially in the form of Exhibit M-8, including all subparts thereto, among the
Luxembourg Guarantor and the Collateral Agent for the benefit of the Secured Parties.
Madeira Guarantor shall mean each Restricted Subsidiary of Parent Borrower organized in
Madeira party hereto as a Guarantor, and each other Restricted Subsidiary of Parent Borrower
organized in Madeira that is required to become a Guarantor pursuant to the terms hereof.
Madeira Security Agreements shall mean, collectively, any Security Agreements substantially
in the form of Exhibit M-9, including all subparts thereto, among the Madeira Guarantor,
the Collateral Agent for the benefit of the Secured Parties, and the other parties referred to
therein.
Management Fees shall have the meaning assigned to such term in Section 6.08(c).
Mandatory Cost shall mean the per annum percentage rate calculated by the Administrative
Agent in accordance with Annex III.
Margin Stock shall have the meaning assigned to such term in Regulation U.
53
Material Adverse Effect shall mean (a) a material adverse effect on the business, property,
results of operations, or financial condition of the Loan Parties and their Restricted
Subsidiaries, taken as a whole; (b) a material impairment of the ability of the Loan Parties to
perform their payment and other material obligations under the Loan Documents; (c) a material
impairment of the rights of or benefits or remedies available to the Lenders, the Administrative
Agent or the Collateral Agent under the Loan Documents, taken as a whole; or (d)(i) a material
adverse effect on the Revolving Credit Priority Collateral or the Liens in favor of the Collateral
Agent (for its benefit and for the benefit of the other Secured Parties) on such Collateral or the
priority of such Liens, in each case for this clause (d)(i) taken as a whole, or (ii) a material
adverse effect on the Pari Passu Priority Collateral or the Liens in favor of the Collateral Agent
(for its benefit and for the benefit of the other Secured Parties) on such Collateral or the
priority of such Liens, in each case for this clause (d)(ii) taken as a whole.
Material Indebtedness shall mean (a) Indebtedness under the Term Loan Documents and any
Permitted Term Loan Facility Refinancings thereof, (b) Indebtedness under the New Senior Notes, the
Additional Senior Secured Indebtedness, the Junior Secured Indebtedness and any Permitted
Refinancings of any thereof in each case in an aggregate outstanding principal amount exceeding
$100,000,000 and (c) any other Indebtedness (other than the Loans and Letters of Credit, and other
than intercompany Indebtedness of the Companies permitted hereunder) of the Loan Parties in an
aggregate outstanding principal amount exceeding $100,000,000.
Material Subsidiary shall mean any Subsidiary of Parent Borrower that is not an Immaterial
Subsidiary.
Maturity Date shall mean December 17, 2015.
Maximum Rate shall have the meaning assigned to such term in Section 11.14.
Minimum Currency Threshold shall mean (w) with regard to Dollar Denominated Loans, (i) an
integral multiple of $1,000,000 and not less than $5,000,000 for Base Rate Loans and (ii) an
integral multiple of $1,000,000 and not less than $5,000,000 for Eurocurrency Loans, (x) with
regard to Euro Denominated Loans, an integral multiple of 1,000,000 and not less than 5,000,000
and (y) with regard to GBP Denominated Loans, not less than GBP2,000,000 and, if greater, an
integral multiple of GBP1,000,000.
Moodys shall mean Moodys Investors Service, Inc.
Mortgage shall mean an agreement, including, but not limited to, a mortgage, charge, deed of
trust, deed of hypothec or any other document, creating and evidencing a Lien on a Mortgaged
Property, which shall be substantially in the form of Exhibit J or, subject to the terms of
the Intercreditor Agreement, other form reasonably satisfactory to the Collateral Agent, in each
case, with such schedules and including such provisions as shall be necessary to conform such
document to applicable local or foreign law or as shall be customary under applicable local or
foreign law.
Mortgaged Property shall mean (a) each Real Property identified as a Mortgaged Property on
Schedule 8(a) to the Perfection Certificate dated the Closing Date, (b) each future
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Real
Property covered by the terms of any Mortgage, and (c) each Real Property, if any, which shall be
subject to a Mortgage (or other Lien created by a Security Document) delivered after the Closing
Date pursuant to Section 5.11(c).
Multiemployer Plan shall mean a multiemployer plan within the meaning of Section 4001(a)(3)
or Section 3(37) of ERISA (a) to which any Company or any ERISA Affiliate is then making or
accruing an obligation to make contributions; (b) to which any Company or any ERISA Affiliate has
within the preceding six plan years made contributions; or (c) with respect to which any Company
could incur liability.
Net Cash Proceeds shall mean:
(a) with respect to any Asset Sale, the cash proceeds received by Holdings, the Parent
Borrower or any of its Restricted Subsidiaries (including cash proceeds subsequently
received (as and when received by Holdings, the Parent Borrower or any of its Restricted
Subsidiaries) in respect of non-cash consideration initially received) net of (without
duplication) (i) selling expenses (including reasonable brokers fees or commissions, legal,
accounting and other professional and transactional fees, transfer and similar taxes and
Administrative Borrowers good faith estimate of income taxes paid or payable in connection
with such sale and repatriation Taxes that are or would be payable in connection with any
sale by a Restricted Subsidiary); (ii) amounts provided as a reserve, in accordance with
GAAP, against (x) any liabilities under any indemnification obligations associated with such
Asset Sale or (y) any other liabilities retained by Holdings, the Parent Borrower or any of
its Restricted Subsidiaries associated with the properties sold in such Asset Sale
(provided that, to the extent and at the time any such amounts are released from
such reserve, such amounts shall constitute Net Cash Proceeds); (iii) Administrative
Borrowers good faith estimate of payments required to be made with respect to unassumed
liabilities relating to the properties sold within ninety (90) days of such Asset Sale
(provided that, to the extent such cash proceeds are not used to make payments in
respect of such unassumed liabilities within ninety (90) days of such Asset Sale, such cash
proceeds shall constitute Net Cash Proceeds); (iv) the principal amount, premium or penalty,
if any, interest and other amounts on any Indebtedness for borrowed money (other than Pari
Passu Secured Obligations) which is secured by a Lien on the properties sold in such Asset
Sale (so long as such Lien was permitted to encumber such properties under the Loan
Documents at the time of such sale) and which is repaid with such proceeds (other than any
such Indebtedness assumed by the purchaser of such properties); and (v) so long as any Pari
Passu Secured Obligations remain outstanding, amounts required to be prepaid under the Pari
Passu Loan Documents from the proceeds of Pari Passu Priority Collateral (provided
that, in the case of an Asset Sale consisting of a sale or other disposition of all or
substantially all of the property or assets or business of a Loan Party or Restricted
Subsidiary, or the Equity Interests of a Restricted Subsidiary, this clause (v) shall be
limited to that portion of the cash proceeds in excess of the net book value of Revolving
Credit Priority Collateral which is subject to such Asset Sale); and
(b) with respect to any Casualty Event, the cash insurance proceeds, condemnation
awards and other compensation received in respect thereof, net of (i) all
55
reasonable costs
and expenses incurred in connection with the collection of such proceeds, awards or other
compensation in respect of such Casualty Event; and (ii) so long as any Pari Passu Secured
Obligations remain outstanding, amounts required to be prepaid under
the Pari Passu Loan Documents in respect of cash insurance proceeds, condemnation
awards and other compensation received in respect of Pari Passu Priority Collateral;
provided, however, that (i) Net Cash Proceeds arising from any Asset Sale or
Casualty Event by or applicable to a non-Wholly Owned Subsidiary shall equal the amount of such Net
Cash Proceeds calculated as provided above less the percentage thereof equal to the percentage of
any Equity Interests of such non-Wholly Owned Subsidiary not owned by Holdings, Parent Borrower and
its Restricted Subsidiaries and (ii) so long as the Pari Passu Secured Obligations remain
outstanding (x) in the case of an Asset Sale consisting of a sale of Equity Interests of a
Subsidiary, the Net Cash Proceeds of such sale shall be deemed to equal the book value of Revolving
Credit Priority Collateral included in such sale as of the date of such sale and (y) in the case of
an Asset Sale consisting of a sale or other disposition of all or substantially all of the property
and assets or business of a Loan Party or Restricted Subsidiary, the net cash proceeds of any such
sale shall be deemed to equal the book value of the Revolving Credit Priority Collateral included
in such sale (and the expenses relating to such Asset Sale shall be allocated proportionately among
the Pari Passu Priority Collateral and the Revolving Credit Priority Collateral).
Net Recovery Cost Percentage shall mean the fraction, expressed as a percentage, (a) the
numerator of which is the amount equal to the recovery on the aggregate amount of the Inventory at
such time on a net orderly liquidation value basis as set forth in the most recent Inventory
Appraisal received by Collateral Agent in accordance with Section 9.02, net of liquidation
expenses, commissions and other expenses reasonably anticipated in the disposition of such assets,
and (b) the denominator of which is the original Cost of the aggregate amount of the Inventory
subject to appraisal.
New Senior Note Agreements shall mean the indentures dated as of the date hereof pursuant to
which the New Senior Notes were issued.
New Senior Note Documents shall mean the New Senior Notes, the New Senior Note Agreements,
the New Senior Note Guarantees and all other documents executed and delivered with respect to the
New Senior Notes or the New Senior Note Agreements.
New Senior Note Guarantees shall mean the guarantees of the Loan Parties (other than
Holdings and the Parent Borrower) pursuant to the New Senior Note Agreement.
New Senior Notes shall mean the Parent Borrowers 8.375% Senior Notes due 2017 and 8.75%
Senior Notes due 2020, each issued pursuant to the New Senior Note Agreements and any senior notes
issued pursuant to a Permitted Refinancing of the New Senior Notes (including any Registered
Equivalent Notes).
NKL shall mean Novelis Korea Limited.
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Non-consolidated Affiliate shall mean each of Norf GmbH, MiniMRF LLC (Delaware), and
Consorcio Candonga (unincorporated Brazil), in each case so long as they are not a Subsidiary of
the Parent Borrower.
Non-consolidated Affiliate Debt shall mean with respect to the Non-consolidated Affiliates,
as of any date of determination and without duplication, the Consolidated Total Net Debt of the
Non-consolidated Affiliates and their Subsidiaries (determined as if references to the Parent
Borrower and the Restricted Subsidiaries in the definition of Consolidated Total Net Debt were
references to Non-consolidated Affiliates and their Subsidiaries).
Non-consolidated Affiliate EBITDA shall mean with respect to the Non-consolidated Affiliates
for any period, the amount for such period of Consolidated EBITDA (Leverage) of such
Non-consolidated Affiliates and their Subsidiaries (determined as if references to the Parent
Borrower and the Restricted Subsidiaries in the definition of Consolidated EBITDA (Leverage) were
references to Non-consolidated Affiliates and their Subsidiaries); provided that
Non-consolidated Affiliate EBITDA shall not include the Non-consolidated Affiliate EBITDA of
Non-consolidated Affiliates if such Non-consolidated Affiliates are subject to a prohibition,
directly or indirectly, on the payment of dividends or the making of distributions, directly or
indirectly, to the Borrower, to the extent of such prohibition.
Non-Dollar Denominated Loan shall mean any Loan that is not a Dollar Denominated Loan.
Non-Extension Notice Date shall have the meaning assigned to such term in Section
2.18(a)(v).
Non-Guarantor Subsidiary shall mean each Subsidiary that is not a Guarantor.
Norf GmbH shall mean Aluminium Norf GmbH, a limited liability company (GmbH) organized under
the laws of Germany.
Notes shall mean any notes evidencing the Revolving Loans or Swingline Loans issued pursuant
to this Agreement, if any, substantially in the form of Exhibit K-1 or K-2.
Novelis AG shall mean Novelis AG, a stock corporation (AG) organized under the laws of
Switzerland.
Novelis AG Cash Pooling Agreement shall mean a Cash Management Agreement entered into among
Novelis AG and certain European Affiliates (as identified therein) dated February 1, 2007,
together with all ancillary documentation thereto.
Novelis Corporation shall mean Novelis Corporation, a Texas corporation.
Novelis Inc. shall mean Novelis Inc., a corporation amalgamated under the Canada Business
Corporations Act.
Obligation Currency shall have the meaning assigned to such term in Section
11.18(a).
57
Obligations shall mean (a) obligations of the Borrowers and the other Loan Parties from time
to time arising under or in respect of the due and punctual payment of (i) the principal of and
premium, if any, and interest (including interest accruing (and interest that would have
accrued but for such proceeding) during the pendency of any Insolvency Proceeding, regardless
of whether allowed or allowable in such proceeding) on the Loans, when and as due, whether at
maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each
payment required to be made by the Borrowers and the other Loan Parties under this Agreement in
respect of any Letter of Credit, when and as due, including payments in respect of Reimbursement
Obligations, interest thereon and obligations to provide cash collateral, (iii) Extraordinary
Expenses and (iv) all other monetary obligations, including fees, costs, expenses and indemnities,
whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations
incurred during the pendency of any Insolvency Proceeding, regardless of whether allowed or
allowable in such proceeding), of the Borrowers and the other Loan Parties under this Agreement and
the other Loan Documents or otherwise stated to constitute Obligations hereunder or thereunder,
and (b) the due and punctual performance of all covenants, agreements, obligations and liabilities
of the Borrowers and the other Loan Parties under or pursuant to this Agreement and the other Loan
Documents.
OFAC shall have the meaning assigned to such term in Section 3.22.
Officers Certificate shall mean a certificate executed by a Responsible Officer in his or
her official (and not individual) capacity.
Organizational Documents shall mean, with respect to any person, (i) in the case of any
corporation, the certificate of incorporation and by-laws (or equivalent or comparable
constitutional documents with respect to any non-U.S. jurisdiction) of such person, (ii) in the
case of any limited liability company, the certificate of formation and operating agreement (or
similar documents) of such person, (iii) in the case of any limited partnership, the certificate of
formation and limited partnership agreement (or similar documents) of such person, (iv) in the case
of any general partnership, the partnership agreement (or similar document) of such person and (v)
in any other case, the functional equivalent of the foregoing.
Other Taxes shall mean all present or future stamp, recording, documentary, excise,
transfer, sales, property or similar taxes, charges or levies arising from any payment made
hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or
otherwise with respect to, this Agreement or any other Loan Document.
Overadvance shall have the meaning assigned to such term in Section 2.01(e).
Parent Borrower shall have the meaning assigned to such term in the preamble hereto.
Parent Borrower Obligations shall mean all Obligations owing to the Administrative Agent,
the Collateral Agent, any Issuing Bank or any Lender by the Parent Borrower.
Pari Passu Loan Documents shall mean Pari Passu Loan Documents as defined in the
Intercreditor Agreement.
Pari Passu Priority Collateral shall have the meaning provided in the Intercreditor
Agreement.
58
Pari Passu Secured Obligations shall mean Pari Passu Secured Obligations as defined in the
Intercreditor Agreement.
Pari Passu Security Documents shall mean Pari Passu Security Documents as defined in the
Intercreditor Agreement.
Participant shall have the meaning assigned to such term in Section 11.04(b).
Participating Member States shall mean the member states of the European Communities that
adopt or have adopted the euro as their lawful currency in accordance with the legislation of the
European Union relating to European Monetary Union.
PBGC shall mean the Pension Benefit Guaranty Corporation referred to and defined in ERISA.
Pensions Regulator shall mean the body corporate called the Pensions Regulator established
under Part I of the Pensions Act 2004.
Perfection Certificate shall mean, individually and collectively, as the context may
require, each certificate of a Loan Party in the form of Exhibit L-1 or any other form
approved by the Administrative Agent in its sole discretion, as the same shall be supplemented from
time to time by a Perfection Certificate Supplement or otherwise.
Perfection Certificate Supplement shall mean a certificate supplement in the form of Exhibit
L-2 or any other form approved by the Administrative Agent.
Permitted Acquisition shall mean any Acquisition, if each of the following conditions is
met:
(i) no Default is then continuing or would result therefrom;
(ii) no Company shall, in connection with any such transaction, assume or remain liable
with respect to any Indebtedness of the related seller or the business, person or properties
acquired, except to the extent permitted under Section 6.01, and any other such
Indebtedness not permitted to be assumed or otherwise supported by any Company hereunder
shall be paid in full or released as to the business, persons or properties being so
acquired on or before the consummation of such acquisition;
(iii) the person or business to be acquired shall be, or shall be engaged in, a
business of the type that the Loan Parties and the Subsidiaries are permitted to be engaged
in under Section 6.15, and the person or business and any property acquired in
connection with any such transaction shall be free and clear of any Liens, other than
Permitted Liens;
59
(iv) the Board of Directors of the person to be acquired shall not have indicated
publicly its opposition to the consummation of such acquisition (which opposition has not
been publicly withdrawn);
(v) all transactions in connection therewith shall be consummated in all material
respects in accordance with Applicable Law;
(vi) with respect to any transaction involving Acquisition Consideration of more than
$50,000,000, unless the Administrative Agent shall otherwise agree, the Administrative
Borrower shall have provided the Administrative Agent written notice on or before the
consummation of such transaction, which notice shall describe (A) in reasonable detail the
terms and conditions of such transaction and the person or business to be acquired and (B)
all such other information and data relating to such transaction or the person or business
to be acquired as may be reasonably requested by the Administrative Agent;
(vii) the property acquired in connection with any such Acquisition shall, subject to
any Permitted Liens, be made subject to the Lien of the Security Documents, and any person
acquired in connection with any such transaction shall become a Guarantor (or a Borrower in
the case of a person organized in the United States, or any state thereof or the District of
Columbia), in each case, to the extent required under, and within the relevant time periods
provided in, Section 5.11;
(viii) with respect to any transaction involving Acquisition Consideration that, when
added to the fair market value of Equity Interests, including Equity Interests of Holdings,
constituting purchase consideration, exceeds $50,000,000, the Administrative Borrower shall
have delivered to the Administrative Agent an Officers Certificate on or prior to the
consummation of such transaction certifying that (A) such transaction complies with this
definition and (B) such transaction could not reasonably be expected to result in a Material
Adverse Effect; and
(ix) either (A) the Availability Conditions are satisfied or (B) the Acquisition
Consideration for such acquisition shall not exceed $25,000,000, and the aggregate amount of
the Acquisition Consideration for all Permitted Acquisitions since the Closing Date made
when the Availability Conditions are not satisfied shall not exceed $50,000,000.
Permitted Amendment shall have the meaning assigned to such term in Section
11.02(g).
Permitted Discretion shall mean Administrative Agents commercially reasonable credit
judgment exercised in good faith in accordance with customary business practices for asset based
lending facilities, based upon its consideration of any factor that it believes (a) could adversely
affect the quantity, quality, mix or value of Collateral (including any Applicable Law that may
inhibit collection of an Account), the enforceability or priority of the Liens on the Collateral
for the benefit of the Secured Parties, or the amount that the Secured Parties could receive in
liquidation of any Collateral; (b) suggests that any collateral report or financial
60
information
delivered by any Loan Party is incomplete, inaccurate or misleading in any material respect; (c)
materially increases the likelihood of any Insolvency Proceeding involving a Loan Party; or (d)
creates or could result in a Default or Event of Default. In exercising such judgment,
Administrative Agent may consider any factors that could increase the credit risk of lending
to Borrowers on the security of the Collateral.
Permitted Factoring Facility shall mean a sale of Receivables on a discounted basis by any
Company that is not organized under the laws of, and does not conduct business in, a Principal
Jurisdiction, so long (i) no Loan Party has any obligation, contingent or otherwise in connection
with such sale (other than to deliver the Receivables purported to be sold free and clear of any
encumbrance), and (ii) such sale is for cash and fair market value.
Permitted First Priority Refinancing Debt shall mean any secured Indebtedness incurred by
the Parent Borrower or Novelis Corporation in the form of one or more series of senior secured
notes under one or more indentures or one or more Term Loans; provided that (i) such
Indebtedness is secured by the Collateral (or a portion thereof) on a pari passu basis (but without
regard to the control of remedies) with the Pari Passu Secured Obligations and is not secured by
any property or assets other than the Collateral, and to the extent such Liens attach to Revolving
Credit Priority Collateral, such Liens on Revolving Credit Priority Collateral shall be junior to
the Liens securing the Secured Obligations, (ii) such Indebtedness constitutes Term Loan Credit
Agreement Refinancing Indebtedness in respect of Term Loans (including portions of classes of Term
Loans, Other Term Loans or Incremental Term Loans), (iii) such Indebtedness does not mature or have
scheduled amortization or payments of principal and is not subject to mandatory redemption or
prepayment (except customary asset sale or change of control provisions, which asset sale
provisions may require the application of proceeds of asset sales and casualty events co-extensive
with those set forth in the Term Loan Credit Agreement, to make mandatory prepayments or prepayment
offers out of such proceeds on a pari passu basis with the Secured Obligations, all other Permitted
First Priority Refinancing Debt and all Additional Senior Secured Indebtedness), in each case prior
to the date that is 181 days after the Maturity Date, (iv) the security agreements relating to such
Indebtedness are substantially the same as the Security Documents (with such differences as are
reasonably satisfactory to the Administrative Agent), (v) such Indebtedness is not guaranteed by
any Persons other than the Loan Parties (including the Parent Borrower if Novelis Corporation is
the issuer thereof), (vi) the other terms and conditions of such Indebtedness (excluding pricing,
premiums and optional prepayment or optional redemption provisions) are customary market terms for
securities of such type (provided that such terms shall in no event include any financial
maintenance covenants) and, in any event, when taken as a whole, are not materially more favorable
to the investors providing such Indebtedness than the terms and conditions of the applicable
Refinanced Debt (except with respect to any terms (including covenants) and conditions contained in
such Indebtedness that are applicable only after the Maturity Date) (provided that a
certificate of a Responsible Officer of the Administrative Borrower shall have delivered to the
Administrative Agent at least five Business Days prior to the incurrence of such Indebtedness,
together with a reasonably detailed description of the material terms and conditions of such
Indebtedness or drafts of the documentation relating thereto, stating that the Administrative
Borrower has determined in good faith that such terms and conditions satisfy the requirement of
this clause (vi) shall be conclusive evidence that such terms and conditions satisfy such
requirement unless the Administrative Agent notifies the Administrative Borrower within such five
Business Day period
61
that it disagrees with such determination (including a reasonable description
of the basis upon which it disagrees)), (vii) no Default shall exist immediately prior to or after
giving effect to such incurrence, and (viii) a Senior Representative acting on behalf of the
holders of such
Indebtedness shall be or have become party to the Intercreditor Agreement and the Liens
securing such Indebtedness shall be subject to the Intercreditor Agreement. Permitted First
Priority Refinancing Debt will include any Registered Equivalent Notes issued in exchange therefor.
Permitted Holdings Amalgamation shall mean the amalgamation of AV Metals and the Parent
Borrower on a single occasion following the Closing Date; provided that (i) no Default
exists or would result therefrom and the representations and warranties set forth in the Loan
Documents shall be true and correct in all material respects on and as of the date of the
amalgamation, with the same effect as though made on such date, except to the extent such
representations and warranties expressly relate to an earlier date, (ii) the person resulting from
such amalgamation shall be named Novelis Inc., and shall be a corporation amalgamated under the
Canada Business Corporations Act (such resulting person, the Successor Parent Borrower), and the
Successor Parent Borrower shall expressly confirm its obligations as the Parent Borrower under this
Agreement and the other Loan Documents to which the Parent Borrower is a party pursuant to a
confirmation in form and substance reasonably satisfactory to the Administrative Agent, (iii)
immediately upon consummation of such amalgamation, a new holding company (Successor Holdings)
with no material assets other than the Equity Interests in the Successor Parent Borrower shall
become the parent guarantor, and Successor Holdings shall (A) be an entity organized or existing
under the laws of Canada or a province thereof, (B) directly own 100% of the Equity Interests in
the Successor Parent Borrower, (C) execute a supplement or joinder to this Agreement in form and
substance reasonably satisfactory to the Administrative Agent to become a Guarantor and execute
Security Documents (or supplements or joinder agreements thereto) in form and substance reasonably
satisfactory to the Administrative Agent, and take all actions necessary or advisable in the
opinion of the Administrative Agent or the Collateral Agent to cause the Lien created by the
applicable Security Documents to be a duly perfected First Priority Lien in accordance with
Applicable Law, including the filing of financing statements (or other applicable filings) in such
jurisdictions as may be reasonably requested by the Administrative Agent or the Collateral Agent
and (D) subject to the terms of the Intercreditor Agreement, pledge and deliver to the Collateral
Agent the certificates, if any, representing all of the Equity Interests of the Successor Parent
Borrower, together with undated stock powers or other appropriate instruments of transfer executed
and delivered in blank by a duly authorized officer of Successor Holdings, (iv) be in compliance
with all covenants and obligations of Holdings under this Agreement, (v) immediately after giving
effect to any such amalgamation, the Consolidated Fixed Charge Coverage Ratio is not less than the
Consolidated Fixed Charge Coverage Ratio immediately prior to such amalgamation, such compliance to
be determined on the basis of the financial information most recently delivered to the
Administrative Agent pursuant to Section 5.01(a) or (b) as though such amalgamation
had been consummated as of the first day of the fiscal period covered thereby and evidenced by a
certificate from the chief financial officer of the Parent Borrower demonstrating such compliance
calculation in reasonable detail, (vi) the Successor Parent Borrower shall have no Indebtedness
after giving effect to the Permitted Holdings Amalgamation other than Indebtedness of the Parent
Borrower in existence prior to the date of the Permitted Holdings Amalgamation, (vii) each other
Guarantor, shall have by a confirmation in form and substance reasonably satisfactory
62
to the
Administrative Agent, confirmed that its guarantee of the Guaranteed Obligations (including its
Guarantee) shall apply to the Successor Parent Borrowers obligations under this Agreement, (viii)
the Parent Borrower and each other Guarantor shall have by confirmations and
any required supplements to the applicable Security Documents reasonably requested by the
Administrative Agent, in each case, in form and substance reasonably satisfactory to the
Administrative Agent confirmed that its obligations thereunder shall apply to the Successor Parent
Borrowers obligations under this Agreement, and (ix) each Loan Party shall have delivered opinions
of counsel and related officers certificates reasonably requested by the Administrative Agent with
respect to the execution and delivery and enforceability of the documents referred to above and the
compliance of such amalgamation with the provisions hereof, and all such opinions of counsel shall
be satisfactory to the Administrative Agent; and provided, further, that (x) if the
foregoing are satisfied, (1) Successor Holdings will be substituted for and assume all obligations
of AV Metals under this Agreement and each of the other Loan Documents and (2) the Successor Parent
Borrower shall be substituted for Novelis Inc. under this Agreement and each of the other Loan
Documents and all references hereunder and under the other Loan Documents to the Parent Borrower
shall be references to the Successor Parent Borrower and (y) notwithstanding any provision of
Section 11.02, the Agents are hereby authorized by the Lenders to make any amendments to
the Loan Documents that are necessary to reflect such changes in the parties to the applicable Loan
Documents.
Permitted Holdings Indebtedness shall mean unsecured Indebtedness of Holdings (i) with
respect to which no Borrower or Subsidiary has any Contingent Obligation, (ii) that will not mature
prior to the 180th day following the Maturity Date, (iii) that has no scheduled amortization of
principal prior to the 180th day following the Maturity Date, (iv) that does not require any
payments in cash of interest or other amounts in respect of the principal thereof (other than
optional redemption provisions customary for senior discount or pay-in-kind notes) for a number
of years from the date of issuance or incurrence thereof equal to at least one-half of the term to
maturity thereof, (v) that has mandatory prepayment, repurchase or redemption, covenant, default
and remedy provisions customary for senior discount or pay-in-kind notes of an issuer that is the
parent of a borrower under senior secured credit facilities, and (vi) that is issued to a person
that is not an Affiliate of the Parent Borrower or any of its Subsidiaries in an arms-length
transaction on fair market terms; provided that at least five Business Days prior to the incurrence
of such Indebtedness, a Responsible Officer of Holdings shall have delivered a certificate to the
Administrative Agent (together with a reasonably detailed description of the material terms and
conditions of such Indebtedness or drafts of the documentation relating thereto) stating that
Holdings has determined in good faith that such terms and conditions satisfy the foregoing
requirements.
Permitted Liens shall have the meaning assigned to such term in Section 6.02.
Permitted Prepayments shall have the meaning assigned to such term in Section 6.11.
Permitted Refinancing shall mean, with respect to any person, any refinancing or renewal of
any Indebtedness of such person; provided that (a) the aggregate principal amount (or
accreted value, if applicable) of the Indebtedness incurred pursuant to such refinancing or renewal
does not exceed the aggregate principal amount (or accreted value, if applicable) of the
Indebtedness so refinanced or renewed except by an amount equal to unpaid accrued interest and
63
premium thereon and any make-whole payments applicable thereto plus other reasonable
amounts paid, and fees and expenses reasonably incurred, in connection with such refinancing or
renewal and by an amount equal to any existing commitments unutilized thereunder, (b) such
refinancing or renewal has a final maturity date equal to or later than the final maturity
date of, and has a Weighted Average Life to Maturity equal to or greater than the Weighted Average
Life to Maturity of, the Indebtedness being refinanced or renewed (excluding the effects of nominal
amortization in the amount of no greater than one percent per annum and prepayments of
Indebtedness), (c) no Default is then continuing or would result therefrom, (d) the persons that
are (or are required to be) obligors under such refinancing or renewal do not include any person
that is not an obligor under the Indebtedness being so refinanced or renewed (or, in the case of a
Permitted Refinancing of the Senior Notes, such obligors are Loan Parties (other than Holdings))
and (e) the subordination provisions thereof (if any) shall be, in the aggregate, no less favorable
to the Lenders than those contained in the Indebtedness being so refinanced or renewed;
provided that at least five Business Days prior to the incurrence of such refinancing or
renewal, a Responsible Officer of the Administrative Borrower shall have delivered an Officers
Certificate to the Administrative Agent (together with a reasonably detailed description of the
material terms and conditions of such Indebtedness or drafts of the documentation relating thereto)
certifying that the Administrative Borrower has determined in good faith that such terms and
conditions satisfy the foregoing requirements.
Permitted Second Priority Refinancing Debt shall mean secured Indebtedness incurred by the
Parent Borrower or Novelis Corporation in the form of one or more series of junior lien secured
notes under one or more indentures or junior lien secured loans under one or more other debt
instruments or facilities; provided that (i) such Indebtedness is secured by a Junior Lien
on the Pari Passu Priority Collateral (or a portion thereof) and is not secured by any property or
assets other than the Pari Passu Priority Collateral, (ii) such Indebtedness constitutes Term Loan
Credit Agreement Refinancing Indebtedness in respect of Term Loans (including portions of classes
of Term Loans, Other Term Loans or Incremental Term Loans), (iii) such Indebtedness does not mature
or have scheduled amortization or payments of principal and is not subject to mandatory redemption
or prepayment (except customary asset sale or change of control provisions), in each case prior to
the date that is 181 days after the Maturity Date, (iv) the security agreements relating to such
Indebtedness are substantially the same as the Security Documents (with such differences as are
reasonably satisfactory to the Administrative Agent), (v) such Indebtedness is not guaranteed by
any Persons other than the Guarantors, (vi) the other terms and conditions of such Indebtedness
(excluding pricing, premiums and optional prepayment or optional redemption provisions), when taken
as a whole, are not materially more favorable to the investors or lenders providing such
Indebtedness than the terms and conditions of the applicable Refinanced Debt (except with respect
to any terms (including covenants) and conditions contained in such Indebtedness that are
applicable only after the Maturity Date) (provided that a certificate of a Responsible Officer of
the Administrative Borrower delivered to the Administrative Agent at least five Business Days prior
to the incurrence of such Indebtedness, together with a reasonably detailed description of the
material terms and conditions of such Indebtedness or drafts of the documentation relating thereto,
stating that the Administrative Borrower has determined in good faith that such terms and
conditions satisfy the requirement of this clause (vi) shall be conclusive evidence that such terms
and conditions satisfy such requirement unless the Administrative Agent notifies the Administrative
Borrower within such five Business Day period that it disagrees with such determination (including
a reasonable
64
description of the basis upon which it disagrees)), (vii) the security agreements
relating to such Indebtedness (together with the Intercreditor Agreement) reflect the Junior Lien
nature of the security interests and are otherwise substantially the same as the applicable
Security Documents
(with such differences as are reasonably satisfactory to the Administrative Agent), (viii) no
Default shall exist immediately prior to or after giving effect to such incurrence and (ix) a
Senior Representative acting on behalf of the holders of such Indebtedness shall have become party
to the Intercreditor Agreement and the Liens securing such Indebtedness shall be subject to the
Intercreditor Agreement. Permitted Second Priority Refinancing Debt will include any Registered
Equivalent Notes issued in exchange therefor.
Permitted Swiss Non-Qualifying Banks shall have the meaning assigned to such term in
Section 5.15(b).
Permitted Term Loan Facility Refinancing shall mean any refinancing or renewal of the
Indebtedness incurred under the Term Loan Documents; provided that (a) such refinancing or
renewal has a final maturity date equal to or later than the final maturity date of, and has a
Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity
of, the Indebtedness being so refinanced or renewed (excluding the effects of nominal amortization
in the amount of no greater than one percent per annum and prepayments of Indebtedness), (b) no
Default is existing or would result therefrom, (c) the collateral securing such refinancing or
renewal is not greater than the Collateral and (d) the persons that are (or are required to be)
obligors under such refinancing or renewal do not include any person that is not an obligor under
the Indebtedness being so refinanced or renewed (unless, in the case of a refinancing of
Indebtedness of a Loan Party, such persons are or become obligors under the Loan Documents);
provided that at least five Business Days prior to the incurrence of such refinancing or renewal, a
Responsible Officer of the Administrative Borrower shall have delivered an Officers Certificate to
the Administrative Agent (together with a reasonably detailed description of the material terms and
conditions of such Indebtedness or drafts of the documentation relating thereto) certifying that
the Administrative Borrower has determined in good faith that such terms and conditions satisfy the
foregoing requirements.
Permitted Unsecured Refinancing Debt shall mean unsecured Indebtedness incurred by the
Parent Borrower or Novelis Corporation in the form of one or more series of senior unsecured notes
or loans under one or more instruments; provided that (i) such Indebtedness constitutes
Term Loan Credit Agreement Refinancing Indebtedness in respect of Term Loans (including portions of
classes of Term Loans, Other Term Loans or Incremental Term Loans), (ii) such Indebtedness does not
mature or have scheduled amortization or payments of principal and is not subject to mandatory
redemption or prepayment (except customary asset sale or change of control provisions), in each
case prior to the date that is 181 days after the Maturity Date, (iii) such Indebtedness is not
guaranteed by any Persons other than the Guarantors, (iv) the other terms and conditions of such
Indebtedness (excluding pricing, premiums and optional prepayment or optional redemption
provisions) are customary market terms for Indebtedness of such type and, when taken as a whole,
are not materially more restrictive (provided that such terms shall in no event include any
financial maintenance covenants) on the Parent Borrower and the Restricted Subsidiaries than the
terms and conditions applicable to the Loans (provided that a certificate of a Responsible Officer
of the Administrative Borrower delivered to the Administrative Agent at least five Business Days
prior to the incurrence of such Indebtedness,
65
together with a reasonably detailed description of
the material terms and conditions of such Indebtedness or drafts of the documentation relating
thereto, stating that the Administrative Borrower has determined in good faith that such terms and
conditions satisfy the requirement of
this clause (iv) shall be conclusive evidence that such terms and conditions satisfy such
requirement unless the Administrative Agent notifies the Administrative Borrower within such five
Business Day period that it disagrees with such determination (including a reasonable description
of the basis upon which it disagrees)) and (v) such Indebtedness (including related guarantees) is
not secured. Permitted Unsecured Refinancing Debt will include any Registered Equivalent Notes
issued in exchange therefor.
person or Person shall mean any natural person, corporation, limited liability company,
trust, joint venture, association, company, partnership, Governmental Authority or other entity.
Plan shall mean any employee pension benefit plan (other than a Multiemployer Plan) subject
to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA which is
maintained or contributed to by any Company or its ERISA Affiliate or with respect to which any
Company could incur liability (including under Section 4069 of ERISA).
Platform shall have the meaning assigned to such term in Section 11.01(d).
Pledged Intercompany Notes shall mean, with respect to each Loan Party, all intercompany
notes described in Schedule 11 to the Perfection Certificate as of the Closing Date and
intercompany notes hereafter acquired by such Loan Party and all certificates, instruments or
agreements evidencing such intercompany notes, and all assignments, amendments, restatements,
supplements, extensions, renewals, replacements or modifications thereof to the extent permitted
pursuant to the terms hereof.
Pledged Securities shall mean, collectively, with respect to each Loan Party, (i) all issued
and outstanding Equity Interests of each issuer set forth on Schedule 10 to the Perfection
Certificate as of the Closing Date as being owned by such Loan Party and all options, warrants,
rights, agreements and additional Equity Interests of whatever class of any such issuer acquired by
such Loan Party (including by issuance), together with all rights, privileges, authority and powers
of such Loan Party relating to such Equity Interests in each such issuer or under any
Organizational Document of each such issuer, and the certificates, instruments and agreements
representing such Equity Interests and any and all interest of such Loan Party in the entries on
the books of any financial intermediary pertaining to such Equity Interests, (ii) all Equity
Interests of any issuer, which Equity Interests are hereafter acquired by such Loan Party or are
owned by a Loan Party as of the date hereof (including by issuance) and all options, warrants,
rights, agreements and additional Equity Interests of whatever class of any such issuer acquired by
such Loan Party (including by issuance), together with all rights, privileges, authority and powers
of such Loan Party relating to such Equity Interests or under any Organizational Document of any
such issuer, and the certificates, instruments and agreements representing such Equity Interests
and any and all interest of such Loan Party in the entries on the books of any financial
intermediary pertaining to such Equity Interests, from time to time acquired by such Loan Party in
any manner, and (iii) all Equity Interests issued in respect of the Equity Interests
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referred to in
clause (i) or (ii) upon any consolidation or merger of any issuer of such Equity Interests, other
than to the extent any of the foregoing constitute Excluded Equity Interests.
Post-Increase Revolving Lenders shall have the meaning assigned to such term in Section
2.23(d).
PPSA shall mean the Personal Property Security Act (Ontario) and the regulations promulgated
thereunder and other applicable personal property security legislation of the applicable Canadian
province or provinces in respect of the Canadian Loan Parties (including the Civil Code of Quebec
and the regulations respecting the register of personal and movable real rights promulgated
thereunder) as all such legislation now exists or may from time to time hereafter be amended,
modified, recodified, supplemented or replaced, together with all rules, regulations and
interpretations thereunder or related thereto.
Pre-Increase Revolving Lenders shall have the meaning assigned to such term in Section
2.23(d).
Prime Rate shall mean the rate of interest announced by Bank of America from time to time as
its prime rate. Such rate is set by Bank of America on the basis of various factors, including its
costs and desired return, general economic conditions and other factors, and is used as a reference
point for pricing some loans, which may be priced at, above or below such rate. Any change in such
prime rate announced by Bank of America shall take effect at the opening of business on the day
specified in the public announcement of such change.
Principal Jurisdiction shall mean (i) the United States, Canada, the United Kingdom,
Switzerland and Germany, (ii) each other country in which a Restricted Subsidiary is organized in
respect of which Accounts are included in the Borrowing Base in accordance with Section
11.02(h) and (iii) and any state, province or other political subdivision of the foregoing.
Principal Loan Party shall have the meaning assigned to such term in Section 3.16.
Priority Payables shall mean at any time, with respect to the Borrowers and the Borrowing
Base Guarantors:
(a) (i) the amount past due and owing by each Borrower or Borrowing Base Guarantor, or
the accrued amount for which such Borrower or Borrowing Base Guarantor has an obligation to
remit to a Governmental Authority or other Person pursuant to any Applicable Law in respect
of (u) pension fund obligations; (v) unemployment insurance; (w) goods and services taxes,
sales taxes, employee income taxes and other taxes payable or to be remitted or withheld;
(x) workers compensation; (y) vacation pay; and (z) other like charges and demands and (ii)
the amount of fees which an insolvency administrator in an insolvency proceeding is allowed
to collect pursuant to German law, including, without limitation, determination fees and
collection fees; in each case with respect to the preceding clauses (i) and (ii), to the
extent any Governmental Authority or other Person may claim a security interest, Lien, trust
or other claim ranking or capable of ranking in priority to or pari passu with one or more
of the First Priority Liens granted in the Security Documents; and
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(b) the aggregate amount of any other liabilities of each Borrower or Borrowing Base
Guarantor (i) in respect of which a trust has been or may be imposed on any Collateral to
provide for payment or (ii) which are secured by a security interest, pledge,
Lien, charge, right or claim on any Collateral; in each case, pursuant to any
Applicable Law and which trust, security interest, pledge, Lien, charge, right or claim
ranks or, in the Permitted Discretion of the Administrative Agent, is capable of ranking in
priority to or pari passu with one or more of the First Priority Liens granted in the
Security Documents (such as Liens, trusts, security interests, pledges, Liens, charges,
rights or claims in favor of employees, landlords, warehousemen, carriers, mechanics,
materialmen, laborers, or suppliers, or Liens, trusts, security interests, pledges, Liens,
charges, rights or claims for ad valorem, excise, sales, or other taxes where given priority
under Applicable Law);
in each case net of the aggregate amount of all restricted cash held or set aside for the payment
of such obligations.
Pro Forma Basis shall mean on a basis in accordance with GAAP and Regulation S-X and
otherwise reasonably satisfactory to the Administrative Agent.
Pro Forma Basis (Leverage) shall mean, with respect to compliance with any test or covenant
hereunder at any time of determination, that all Specified Transactions and the following
transactions in connection therewith (if any) shall be deemed to have occurred as of the first day
of the applicable period of measurement in such test or covenant: (a) income statement items
(whether positive or negative) attributable to the property or Person subject to such Specified
Transaction, (i) in the case of a sale or other disposition of all or substantially all Equity
Interests in or assets of any Restricted Subsidiary of the Parent Borrower or any division,
business unit, line of business or facility used for operations of the Parent Borrower or any of
its Restricted Subsidiaries, shall be excluded, and (ii) in the case of a Permitted Acquisition or
Investment described in the definition of Specified Transaction, shall be included, (b) any
retirement of Indebtedness, and (c) any Indebtedness incurred or assumed by the Parent Borrower or
any of its Restricted Subsidiaries in connection therewith.
Pro Rata Percentage of (i) any Lender at any time shall mean the percentage of the total
Commitments of all Lenders represented by such Lenders Commitment, and (ii) any Lender with
respect to a Class or Sub-Class of Obligations or Commitments (or exposure with respect to Loans or
Obligations of a Class or Sub-Class), as applicable, shall mean the percentage of the total
Commitments of such Class or Sub-Class, as applicable, of all Lenders represented by such Lenders
Commitment of such Class or Sub-Class; provided that the Pro Rata Percentage of any Lender
with respect to any Letter of Credit Commitment or exposure, shall be with respect to U.S. Letters
of Credit or European Letters of Credit, or Letters of Credit, determined with respect to the
Commitment of such Lender relative to all Lenders.
Process Agent shall have the meaning assigned to such term in Section 11.09(d).
property shall mean any right, title or interest in or to property or assets of any kind
whatsoever, whether real, personal or mixed and whether tangible or intangible and including Equity
Interests or other ownership interests of any person and whether now in existence or owned or
hereafter entered into or acquired, including all Real Property.
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Property Material Adverse Effect shall mean, with respect to any Mortgaged Property, as of
any date of determination and whether individually or in the aggregate, any event,
circumstance, occurrence or condition which has caused or resulted in (or would reasonably be
expected to cause or result in) a material adverse effect on (a) the business or operations of any
Company as presently conducted at the Mortgaged Property; (b) the value or utility of the Mortgaged
Property; or (c) the legality, priority or enforceability of the Lien created by the Mortgage or
the rights and remedies of the Mortgagee thereunder.
Proposed Transaction shall mean any Dividend, prepayment of Indebtedness, Investment,
Acquisition, Asset Sale, or other transaction, payment or other action, in each case where the Loan
Parties would be required to meet the Availability Conditions in order to be permitted to
consummate such transaction, make such payment or take such other action.
Protective Advances shall have the meaning assigned to such term in Section 2.01(f).
Purchase Money Obligation shall mean, for any person, the obligations of such person in
respect of Indebtedness (including Capital Lease Obligations) incurred for the purpose of financing
all or any part of the purchase price of any property (including Equity Interests of any person) or
the cost of installation, construction or improvement of any property and any refinancing thereof;
provided, however, that (i) such Indebtedness is incurred within one year after
such acquisition, installation, construction or improvement of such property by such person and
(ii) the amount of such Indebtedness does not exceed 100% of the cost of such acquisition,
installation, construction or improvement, as the case may be.
Purchased Receivables shall have the meaning assigned to such term in any Receivables
Purchase Agreement.
Qualified Capital Stock of any person shall mean any Equity Interests of such person that
are not Disqualified Capital Stock.
Qualified IPO shall mean (i) the issuance by Holdings, or any direct or indirect parent of
Holdings which owns no material assets other that its direct or indirect ownership interest in the
Equity Interests of the Parent Borrower, of its common Equity Interests in an underwritten primary
or secondary public offering (other than a public offering pursuant to a registration statement on
Form S-8) pursuant to an effective registration statement filed with the U.S. Securities and
Exchange Commission in accordance with the Securities Act or (ii) a Qualified Parent Borrower IPO.
Qualified Parent Borrower IPO shall mean the issuance by the Parent Borrower of its common
Equity Interests in an underwritten primary or secondary public offering (other than a public
offering pursuant to a registration statement on Form S-8) pursuant to an effective registration
statement filed with the U.S. Securities and Exchange Commission in accordance with the Securities
Act.
Qualified Securitization Transaction shall mean any transaction or series of transactions
that may be entered into by any Restricted Subsidiary (other than a Restricted Subsidiary organized
under the laws of a Principal Jurisdiction) pursuant to which such Restricted Subsidiary may sell,
convey or otherwise transfer to a Securitization Entity or may
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grant a security interest in any
Receivables (whether now existing or arising or acquired in the future) of such Restricted
Subsidiary or any Related Security or Securitization Assets; provided
that no Receivables or other property of any Company organized in a Principal Jurisdiction
shall be subject to a Qualified Securitization Transaction.
Real Property shall mean, collectively, all right, title and interest (including any
freehold, leasehold, minerals or other estate) in and to any and all parcels of or interests in
real property owned, leased or operated by any person, whether by lease, license or other means,
together with, in each case, all easements, hereditaments and appurtenances relating thereto, all
improvements and appurtenant fixtures, all general intangibles and contract rights and other
property and rights incidental to the ownership, lease or operation thereof.
Receivable shall mean the indebtedness and other obligations owed to any Company (other than
any Company organized under the laws of a Principal Jurisdiction) (at the time such indebtedness
and other obligations arise, and before giving effect to any transfer or conveyance contemplated
under any Qualified Securitization Transaction documentation) arising in connection with the sale
of goods or the rendering of services by such person, including any indebtedness, obligation or
interest constituting an Account, contract right, payment intangible, promissory note, chattel
paper, instrument, document, investment property, financial asset or general intangible, in each
case, arising in connection with the sale of goods or the rendering of services by such person, and
further includes, the obligation to pay any finance charges with respect thereto.
Receivables Purchase Agreement shall mean each of (a) the Non-Recourse Receivables Purchase
Agreement dated July 6, 2007 (as amended and restated on or around the date hereof), and any
related servicing agreements (collectively, the German Receivables Purchase Agreement) between
the German Seller, on the one hand, and Novelis AG, on the other hand, in each case with such
modifications or amendments as may be reasonably satisfactory to the Administrative Agent in each
case providing, inter alia, for the sale and transfer of Accounts by the German Seller to Novelis
AG, (b) each Swiss Receivables Purchase Agreement between one or more Swiss Sellers, as sellers,
and Novelis AG, as purchaser, in such form as may be acceptable to the parties thereto and the
Administrative Agent (individually and collectively, as the context may require, the Swiss
Receivables Purchase Agreement) and (c) any other receivables purchase agreement and related
servicing agreements entered into after the Closing Date pursuant to Section 11.02(h)
between a Subsidiary Guarantor and a Borrower or a Borrowing Base Guarantor, in order that the
receivables subject thereto may be included in the Borrowing Base.
Receivables Seller shall mean German Seller, each Swiss Seller and any other Subsidiary
Guarantor that is a seller of Receivables pursuant to a Receivables Purchase Agreement (including
in its roles as seller and collection agent thereunder).
Receiver shall mean a receiver or receiver and manager or, where permitted by law, an
administrative receiver of the whole or any part of the Collateral, and that term will include any
appointee under joint and/or several appointments.
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Receiver Indemnitees shall mean each Receiver and their officers, directors, employees,
Affiliates, agents and attorneys.
Refinanced Debt shall have the meaning assigned to such term in the definition of Term Loan
Credit Agreement Refinancing Indebtedness.
Refinancing shall mean the purchase and retirement of the Existing Senior Notes purchased
under the Debt Tender Offers on the Closing Date and repayment in full and the termination of any
commitment to make extensions of credit under all of the outstanding Indebtedness listed on
Schedule 1.01(a) of the Parent Borrower or any of its Restricted Subsidiaries.
Register shall have the meaning assigned to such term in Section 11.04(d).
Registered Equivalent Notes means, with respect to any notes originally issued in a Rule
144A or other private placement transaction under the Securities Act of 1933, substantially
identical notes (having the same guarantees) issued in a Dollar-for-Dollar exchange therefor
pursuant to an exchange offer registered with the SEC.
Regulation shall have the meaning assigned to such term in Section 3.27.
Regulation D shall mean Regulation D of the Board as from time to time in effect and all
official rulings and interpretations thereunder or thereof.
Regulation S-X shall mean Regulation S-X promulgated under the Securities Act.
Regulation T shall mean Regulation T of the Board as from time to time in effect and all
official rulings and interpretations thereunder or thereof.
Regulation U shall mean Regulation U of the Board as from time to time in effect and all
official rulings and interpretations thereunder or thereof.
Regulation X shall mean Regulation X of the Board as from time to time in effect and all
official rulings and interpretations thereunder or thereof.
Reimbursement Date shall have the meaning assigned to such term in Section 2.18(b).
Reimbursement Obligations shall mean each applicable Borrowers obligations under
Section 2.18 to reimburse LC Disbursements and its obligations to pay fees and other
amounts with regard to drawings on Letters of Credit.
Related Business Assets shall mean assets (other than cash or Cash Equivalents) used or
useful in a Similar Business; provided that any assets received by any Loan Party in
exchange for assets transferred by a Loan Party shall not be deemed to be Related Business Assets
if they consist of securities of a person, unless upon receipt of the securities of such person,
such person would become a Loan Party.
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Related Parties shall mean, with respect to any person, such persons Affiliates and the
partners, directors, officers, employees, agents, trustees and advisors of such person and of such
persons Affiliates.
Related Security shall mean, with respect to any Receivable, all of the applicable
Restricted Subsidiarys interest in the inventory and goods (including returned or repossessed
inventory or goods), if any, the sale of which by the applicable Company gave rise to such
Receivable, and all insurance contracts with respect thereto, all other security interests or liens
and property subject thereto from time to time, if any, purporting to secure payment of such
Receivable, whether pursuant to the contract related to such Receivable or otherwise, together with
all financing statements and security agreements describing any collateral securing such
Receivable, all guaranties, letters of credit, letter-of-credit rights, supporting obligations,
insurance and other agreements or arrangements of whatever character from time to time supporting
or securing payment of such Receivable whether pursuant to the contract related to such Receivable
or otherwise, all service contracts and other contracts and agreements associated with such
Receivable, all records related to such Receivable, and all of the applicable Companys right,
title and interest in, to and under the applicable Qualified Securitization Transaction
documentation.
Release shall mean any spilling, leaking, seepage, pumping, emitting, emptying, discharging,
injecting, escaping, leaching, dumping, disposing, depositing, dispersing, emanating or migrating
of any Hazardous Material in, into, onto or through the Environment.
Relevant Amount shall have the meaning assigned to such term in Section 2.06(j).
Relevant Currency Equivalent shall mean the Dollar Equivalent or each Alternate Currency
Equivalent, as applicable.
Rent Reserve shall mean a Reserve established by the Administrative Agent in an amount equal
to the latest three months rent payments made by any Borrower or Borrowing Base Guarantor for each
location at which Inventory of the Borrowers and Borrowing Base Guarantors is located that is not
subject to a Landlord Access Agreement or Bailee Letter (as reported to the Administrative Agent by
the Administrative Borrower from time to time as requested by the Administrative Agent), as such
amount may be adjusted from time to time by the Administrative Agent in its Permitted Discretion
taking into account any statutory provisions detailing the extent to which landlords, warehousement
or other bailees may make claims against Inventory located thereon.
Report shall have the meaning assigned to such term in Section 10.02(c).
Required Lenders shall mean, as of any date of determination, Lenders holding more than 50%
of the sum of all outstanding Commitments (or after the termination thereof, Total Revolving
Exposure); provided that the Commitment of, and the portion of the Loans held or deemed
held by, any Defaulting Lender shall be excluded for purposes of making a determination of Required
Lenders.
Reserves shall mean reserves established from time to time against the Borrowing Base (in
the case of Availability Reserves or other reserves) or the Commitments (in the case of
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Availability Reserves) by the Administrative Agent pursuant to Section 2.01(d) or otherwise in
accordance with this Agreement.
Response shall mean (a) response as such term is defined in CERCLA, 42 U.S.C. § 9601(24),
and (b) all other actions required by any Governmental Authority or voluntarily undertaken to (i)
clean up, remove, treat, abate or in any other way address any Hazardous Material in the
Environment; (ii) prevent the Release or threat of Release, or minimize the further Release, of any
Hazardous Material; or (iii) perform studies and investigations in connection with, or as a
precondition to, or to determine the necessity of the activities described in, clause (i) or (ii)
above.
Responsible Officer shall mean, with respect to any Person, any of the principal executive
officers, managing members or general partners of such Person but, in any event, with respect to
financial matters, the chief financial officer, treasurer or controller of such person. Any
document delivered hereunder that is signed by a Responsible Officer of a Loan Party shall be
conclusively presumed to have been authorized by all necessary corporate, partnership and/or other
action on the part of such Loan Party and such Responsible Officer shall be conclusively presumed
to have acted on behalf of such Loan Party.
Restricted Grantor shall mean a Loan Party that has granted a Guarantee that is subject to
limitations that impair in any material respect the benefit of such Guarantee (as determined by the
Administrative Agent in its Permitted Discretion) (it being expressly understood and agreed that
(i) no Loan Party that is a Parent Borrower, a Canadian Guarantor, a U.K. Borrower, a U.K.
Guarantor, a Madeira Guarantor or a U.S. Borrower shall be a Restricted Grantor and (ii) except as
may be otherwise determined by the Administrative Agent in its Permitted Discretion, each Loan
Party that is a German Guarantor, an Irish Guarantor, a Swiss Borrower, a Swiss Guarantor, a French
Guarantor, a Luxembourg Guarantor or a Brazilian Guarantor shall be a Restricted Grantor).
Restricted Subsidiary shall mean, as the context requires, (i) any Subsidiary of Holdings
other than an Unrestricted Subsidiary and (ii) any Subsidiary of any Borrower other than an
Unrestricted Subsidiary.
Restricted Sub-Participation shall mean a sub-participation of the rights and/or the
obligations of a Lender under this Agreement which is not substantially in the form recommended
from time to time by the London Loan Market Association (LMA) (including, in particular, a
provision on status of participation substantially in the form set out in Clause 6.1 of the LMA
Funded Participation (PAR) form as at the date of this Agreement and Clause 7.1 of the current LMA
Risk Participation (PAR) form as at the date of this Agreement, except for changes that have been
approved by the Administrative Agent.
Revolving Availability Period shall mean the period from and including the Closing Date to
but excluding the earlier of (i) the Business Day preceding the Maturity Date and (ii) the date of
termination of the Revolving Commitments.
Revolving Commitment shall mean, with respect to each Lender, the commitment, if any, of
such Lender to make Revolving Loans and purchase participations in Letters of Credit
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hereunder up
to the amount set forth on Annex I with respect to such Lender directly under the column entitled
Revolving Commitment or in an Increase Joinder, or in the Assignment and Assumption pursuant to
which such Lender assumed its Revolving Commitment, as applicable,
as the same may be (a) increased pursuant to Section 2.23, (b) reduced from time to
time pursuant to Section 2.07 and (c) reduced or increased from time to time pursuant to
assignments by or to such Lender pursuant to Section 11.04. The aggregate amount of the
Lenders Revolving Commitments on the Closing Date is $800,000,000.
Revolving Credit Priority Collateral shall mean all Revolving Credit Priority Collateral
as defined in the Intercreditor Agreement.
Revolving Exposure shall mean, with respect to any Lender at any time, the sum of U.S.
Revolving Exposure, Swiss Revolving Exposure and U.K. Revolving Exposure of such Lender.
Revolving Lender shall mean each Lender which has a Revolving Commitment (without giving
effect to any termination of the Total Revolving Commitment if any LC Exposure remains outstanding)
or which has any outstanding Revolving Loans (or any then outstanding LC Exposure).
Revolving Loan shall have the meaning assigned to such term in Section 2.01(a). For
the avoidance of doubt, Revolving Loans shall include U.S. Swingline Loans, and Revolving Loans of
any Class or Type shall include Overadvances and Protective Advances made as Loans of such Class or
Type (other than Overadvances made as European Swingline Loans).
Revolving Percentage of any Revolving Lender at any time shall be that percentage which is
equal to a fraction (expressed as a percentage) the numerator of which is the Revolving Commitment
of such Revolving Lender at such time and the denominator of which is the Total Revolving
Commitment at such time, provided that if any such determination is to be made after the
Total Revolving Commitment (and the related Revolving Commitments of the Lenders) has (or have)
terminated, the determination of such percentages shall be made immediately before giving effect to
such termination.
S&P shall mean Standard & Poors Rating Services, a division of the McGraw-Hill Companies,
Inc. and any successor thereto.
Sale and Leaseback Transaction shall have the meaning assigned to such term in Section
6.03.
Sarbanes-Oxley Act shall mean the United States Sarbanes-Oxley Act of 2002, as amended, and
all rules and regulations promulgated thereunder.
Secured Bank Product Obligations shall mean Bank Product Debt owing to a Secured Bank
Product Provider, up to the maximum amount (in the case of any Secured Bank Product Provider other
than Bank of America and its Affiliates) specified by such provider in writing to Administrative
Agent, which amount may be established or increased (by further written notice to Administrative
Agent from time to time) as long as no Default or Event of Default exists and establishment of a
Bank Product Reserve for such amount and all other
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Secured Bank Product Obligations would not
result in (i) the Total Revolving Exposure exceeding the Total Borrowing Base then in effect, or
(ii) the Total Adjusted Revolving Exposure exceeding the Total Adjusted Borrowing Base then in
effect.
Secured Bank Product Provider shall mean (a) Bank of America or any of its Affiliates; and
(b) any Lender or Affiliate of a Lender that is providing a Bank Product, provided the provider
delivers written notice to Administrative Agent, in form and substance satisfactory to
Administrative Agent, by the later of the Closing Date (or, in the case of a person who becomes a
Lender pursuant to an assignment under Section 11.04(c) or an Increase Joinder, 10 days
after such person becomes a Lender) or 10 days following creation of the Bank Product, (i)
describing the Bank Product and setting forth the maximum amount to be secured by the Collateral
and the methodology to be used in calculating such amount, and (ii) agreeing to be bound by
Section 10.12.
Secured Debt Agreement shall mean (i) this Agreement, (ii) the other Loan Documents and
(iii) any Bank Product Agreement entered into by a Company with any counterparty that is a Secured
Bank Product Provider.
Secured Obligations shall mean (a) the Obligations and (b) the due and punctual payment and
performance of all Secured Bank Product Obligations.
Secured Parties shall mean, collectively, the Administrative Agent, the Collateral Agent,
each co-agent or sub-agent appointed by the Administrative Agent or the Collateral Agent, any
Receiver or Delegate, each other Agent, the Lenders, the Issuing Banks, each Secured Bank Product
Provider.
Securities Act shall mean the Securities Act of 1933.
Securities Collateral shall mean, collectively, the Pledged Securities, the Pledged
Intercompany Notes and the Distributions.
Securitization Assets shall mean all existing or hereafter acquired or arising (i)
Receivables that are sold, assigned or otherwise transferred pursuant to a Qualified Securitization
Transaction, (ii) the Related Security with respect to the Receivables referred to in clause (i)
above, (iii) the collections and proceeds of the Receivables and Related Security referred to in
clauses (i) and (ii) above, (iv) all lockboxes, lockbox accounts, collection accounts or other
deposit accounts into which such collections are deposited (and in any event excluding any
lockboxes, lockbox accounts, collection accounts or deposit accounts that any Company organized
under the laws of any Principal Jurisdiction has an interest in) and which have been specifically
identified and consented to by the Administrative Agent, (v) all other rights and payments which
relate solely to such Receivables and (vi) all cash reserves comprising credit enhancements for
such Qualified Securitization Transaction.
Securitization Entity shall mean any corporation, company (including any limited liability
company), association, partnership, joint venture, trust, mutual fund or other business entity to
which any Restricted Subsidiary (excluding any Restricted Subsidiary that is in a Principal
Jurisdiction) or any other Securitization Entity transfers Receivables and Related Security) (a)
which engages in no activities other than in connection with the financing of
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Receivables or
Related Security, (b) which is designated by the Board of Directors of the Parent Borrower as a
Securitization Entity, (c) no portion of the Indebtedness or any other obligations (contingent or
otherwise) of which (i) is guaranteed by the Parent Borrower or any Restricted
Subsidiary (excluding guarantees of such transferor Restricted Subsidiary of obligations
(other than the principal of, and interest on, Indebtedness) pursuant to Standard Securitization
Undertakings and guarantees by the Securitization Entity), (ii) is recourse to or obligates the
Parent Borrower or any Restricted Subsidiary (other than the Securitization Entity) in any way
other than pursuant to Standard Securitization Undertakings or (iii) subjects any property or asset
of the Parent Borrower or any Restricted Subsidiary (other than the Securitization Entity),
directly or indirectly, contingently or otherwise, to the satisfaction thereof, other than pursuant
to Standard Securitization Undertakings and other than any interest in the Receivables and Related
Security being financed (whether in the form of any equity interest in such assets or subordinated
indebtedness payable primarily from such financed assets) retained or acquired by the transferor
Restricted Subsidiary, (d) to which none of the Parent Borrower nor any Restricted Subsidiary has
any obligation to maintain or preserve such entitys financial condition or cause such entity to
achieve certain levels of operating results and (e) with which none of Holdings, the Parent
Borrower nor any Restricted Subsidiary of the Parent Borrower has any material contract, agreement,
arrangement or understanding other than those customary for a Qualified Securitization Transaction
and, in any event, on terms no less favorable to the Parent Borrower or such Restricted Subsidiary
that those that might be obtained at the time from Persons that are not Affiliates of the Parent
Borrower or such Restricted Subsidiary. Any such designation by the Board of Directors shall be
evidenced to the Administrative Agent by providing the Administrative Agent with a certified copy
of the resolution of the Board of Directors giving effect to such designation and an Officers
Certificate certifying that such designation complied with the foregoing conditions.
Security Agreement shall mean each U.S. Security Agreement, each Canadian Security
Agreement, each U.K. Security Agreement, each Swiss Security Agreement, each German Security
Agreement, each Irish Security Agreement, each Brazilian Security Agreement, each Luxembourg
Security Agreement, each Madeira Security Agreement, each French Security Agreement, and each other
Security Agreement entered into pursuant to Section 5.11(b), individually and collectively,
as the context may require.
Security Agreement Collateral shall mean all property pledged or granted as Collateral
pursuant to any Security Agreement (a) on the Closing Date or (b) thereafter pursuant to
Section 5.11.
Security Documents shall mean each Security Agreement, the Mortgages, any Security Trust
Deed, and each other security document, deed of trust, charge or pledge agreement delivered in
accordance with applicable local or foreign law to grant a valid, perfected security interest in
any property as Collateral for the Secured Obligations, and all UCC or other financing statements
or financing change statements, control agreements, bailee notification letters, or instruments of
perfection required by this Agreement, any Security Agreement, any Mortgage or any other such
security document, charge or pledge agreement to be filed with respect to the security interests in
property and fixtures created pursuant to any Security Agreement or any Mortgage and any other
document or instrument utilized to pledge or grant or purport to pledge or grant a security
interest or lien on any property as Collateral for the Secured
76
Obligations or to perfect, obtain
control over or otherwise protect the interest of the Collateral Agent therein.
Security Trust Deed shall mean any security trust deed to be executed by, among others, the
Collateral Agent, the Administrative Agent and any Loan Party granting security over U.K. or Irish
assets of any Loan Party.
Senior Note Documents shall mean the collective reference to the Existing Senior Note
Documents and the New Senior Note Documents.
Senior Note Guarantees shall mean shall mean the collective reference to the Existing Senior
Note Guarantee and the New Senior Note Guarantees.
Senior Notes shall mean shall mean the collective reference to the Existing Senior Notes and
the New Senior Notes.
Senior Representative means, with respect to any series of Permitted First Priority
Refinancing Debt, Permitted Second Priority Refinancing Debt, Additional Senior Secured
Indebtedness or Junior Secured Indebtedness, the trustee, administrative agent, collateral agent,
security agent or similar agent under the indenture or agreement pursuant to which such
Indebtedness is issued, incurred or otherwise obtained, as the case may be, and each of their
successors in such capacities.
Senior Secured Net Leverage Ratio shall mean, with respect to any date of determination (the
Calculation Date), the ratio of (a) Consolidated Total Net Debt as of the Calculation Date (other
than any portion of Consolidated Total Net Debt that is unsecured or is secured solely by Liens
that are subordinated to the Liens securing the Pari Passu Secured Obligations pursuant to the
Intercreditor Agreement) (it being understood that Indebtedness under the Loan Documents which
constitutes Consolidated Total Net Debt will be included in the Senior Secured Net Leverage Ratio)
to (b) Consolidated EBITDA for the Test Period most recently ended prior to the Calculation Date
for which financial information has been delivered to the Administrative Agent and the Lenders
pursuant to Section 5.01(a) or (b).
Series of Cash Neutral Transactions shall mean any series of Investments, incurrences of
Indebtedness, Asset Sales in the form of transfers of intercompany promissory notes and preferred
stock or similar instruments and/or Dividends solely among Companies; provided that (i) the
amount of cash or Cash Equivalents transferred by any Company (each such Company, an Initiating
Company) to another Company in such Series of Cash Neutral Transactions is not greater than the
amount of cash or Cash Equivalents received by such Initiating Company in such Series of Cash
Neutral Transactions less reasonable transaction expenses and taxes (which cash and Cash
Equivalents must be received by such Initiating Company within three Business Days of the
initiation of such Series of Cash Neutral Transactions), (ii) any Collateral (including cash or
Cash Equivalents of any Loan Party involved in such Series of Cash Neutral Transactions) shall
remain subject to a perfected security interest of the Collateral Agent, and the validly,
perfection and priority of such security interest shall not be impaired by or in connection with
such Series of Cash Neutral Transactions, (iii) no more than $50,000,000 in aggregate of cash or
Cash Equivalents may be held by Companies that are
77
not Loan Parties in connection with transfers
from Loan Parties as part of such Series of Cash Neutral Transactions (and any such Company that is
not a Loan Party may not retain any of such cash or Cash Equivalents after giving effect to the
Cash Neutral Transactions) and (iv) the fair
market value of the assets (other than cash or Cash Equivalents) that may be held by Companies
that are not Loan Parties in connection with transfers from Loan Parties as part of such Series of
Cash Neutral Transactions may not exceed $50,000,000 in the aggregate.
Settlement has the meaning assigned to such term in Section 2.17(c).
Settlement Date has the meaning assigned to such term in Section 2.17(c).
Significant Event of Default shall mean any Event of Default under Section 8.01(a),
(b), (g) or (h).
Similar Business shall mean any business conducted by the Parent Borrower and the other Loan
Parties on the Closing Date as described in the Confidential Information Memorandum (or, in the
good faith judgment of the Board of Directors of the Parent Borrower, which is substantially
related thereto or is a reasonable extension thereof).
SL Scheme shall mean the Syndicated Loan relief scheme as described in the HM Revenue &
Customs Guidelines dated September 2010 and administered by HM Revenue & Customs Centre for
Non-Residents.
Specified Equity Contribution shall mean any cash contribution to the common equity of
Holdings and/or any purchase or investment in an Equity Interest of Holdings other than
Disqualified Capital Stock constituting a Specified Equity Contribution pursuant to Section 8.04
of the Term Loan Credit Agreement (or any similar term in any Term Loan Credit Agreement
Refinancing Indebtedness).
Specified Holders shall mean Hindalco and its Affiliates.
Specified Transaction shall mean, with respect to any period, any Permitted Acquisition
(other than Permitted Acquisitions where the amount of the Acquisition Consideration plus the fair
market value of any Equity Interests which constitutes all or a portion of the purchase price is
less than $15,000,000), Asset Sales (other than any dispositions in the ordinary course of business
and dispositions where the fair market value of the assets disposed of is less than $15,000,000),
Dividend, designation or redesignation of a Subsidiary as a Restricted Subsidiary or an
Unrestricted Subsidiary, incurrence or prepayment of Indebtedness (including any transaction under
Section 6.11), any Incremental Term Loan or Revolving Credit Commitment increase that by
the terms of this Agreement requires compliance on a Pro Forma Basis with a test or covenant
hereunder or requires such test or covenant (or a component of such test or covenant) to be
calculated on a Pro Forma Basis.
Spot Selling Rate shall mean, as determined by the Administrative Agent on any day, the rate
offered in the foreign exchange market for the purchase of the applicable currency with Dollars at
the end of the preceding day, as such rate is published by Bloomberg for such day or, if no such
rate is published by Bloomberg, then as offered through the foreign exchange trading office of the
Administrative Agent or another financial institution on such day.
78
Standard Securitization Undertakings shall mean representations, warranties, covenants and
indemnities entered into by any Restricted Subsidiary (other than a Restricted
Subsidiary organized under the laws of a Principal Jurisdiction) that are negotiated in good
faith at arms length in a Receivables securitization transaction so long as none of the same
constitute Indebtedness, a Contingent Obligation (other than in connection with an obligation to
repurchase receivables that do not satisfy related representations and warranties) or otherwise
require the provision of credit support in excess of customary credit enhancement established upon
entering into such Receivables securitization transaction negotiated in good faith at arms length.
Standby Letter of Credit shall mean any standby letter of credit or similar instrument
issued for the purpose of supporting obligations of Holdings or any of its Subsidiaries not
prohibited by this Agreement.
Statutory Reserves shall mean (a) for any Interest Period for any Eurocurrency Borrowing in
Dollars, the average maximum rate at which reserves (including any marginal, supplemental or
emergency reserves) are required to be maintained during such Interest Period under Regulation D by
member banks of the United States Federal Reserve System in New York City with deposits exceeding
$1,000,000,000 against Eurocurrency liabilities (as such term is used in Regulation D), (b) for
any Interest Period for any portion of a Borrowing in GBP, the average maximum rate at which
reserves (including any marginal, supplemental or emergency reserves), if any, are in effect on
such day for funding in GBP maintained by commercial banks which lend in GBP, (c) for any Interest
Period for any portion of a European Swingline Borrowing in Swiss francs, the average maximum rate
at which reserves (including any marginal, supplemental or emergency reserves), if any, are in
effect on such day for funding in Swiss francs maintained by commercial banks which lend in Swiss
francs or (d) for any Interest Period for any portion of a Borrowing in euros, the average maximum
rate at which reserves (including any marginal, supplemental or emergency reserves), if any, are in
effect on such day for funding in euros maintained by commercial banks which lend in euros.
Eurocurrency Borrowings and EURIBOR Borrowings shall be deemed to constitute Eurocurrency
liabilities and to be subject to such reserve requirements without benefit of or credit for
proration, exceptions or offsets which may be available from time to time to any Lender under
Regulation D.
Sub-Class, when used in reference to any Revolving Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are U.S. Revolving Loans, U.K. Revolving Loans or
Swiss Revolving Loans.
Subordinated Indebtedness shall mean Indebtedness of a Loan Party that is subordinated by
its terms (including pursuant to the terms of any subordination agreement, intercreditor agreement,
or otherwise) in right of payment to the Obligations of such Loan Party.
Subordinated Lien Secured Obligations shall mean Subordinated Lien Secured Obligations as
defined in the Intercreditor Agreement.
Subsidiary shall mean, with respect to any person (the parent) at any date, (i) any
corporation, limited liability company, association or other business entity of which securities or
other ownership interests representing more than 50% of the voting power of all Equity Interests
entitled (without regard to the occurrence of any contingency) to vote in the election of the Board
79
of Directors thereof are, as of such date, owned, controlled or held by the parent and/or one or
more subsidiaries of the parent, (ii) any partnership (a) the sole general partner or the managing
general partner of which is the parent and/or one or more subsidiaries of the parent or (b)
the only general partners of which are the parent and/or one or more subsidiaries of the parent and
(iii) any other person that is otherwise Controlled by the parent and/or one or more subsidiaries
of the parent. Unless the context requires otherwise, Subsidiary refers to a Subsidiary of
Holdings. Notwithstanding the foregoing, Logan shall not be treated as a Subsidiary hereunder or
under the other Loan Documents unless it qualifies as a Subsidiary under clause (i) of this
definition.
Subsidiary Guarantor shall mean each Restricted Subsidiary listed on Schedule
1.01(b), and each other Restricted Subsidiary that is or becomes a party to this Agreement as a
Subsidiary Guarantor pursuant to Section 5.11 or otherwise.
Successor Holdings shall have the meaning assigned to such term in the definition of
Permitted Holdings Amalgamation.
Successor Parent Borrower shall have the meaning assigned to such term in the definition of
Permitted Holdings Amalgamation.
Support Agreement shall mean the Support Agreement, dated December 17, 2010, among Novelis
North America Holdings Inc., Novelis Acquisitions LLC and the Parent Borrower.
Survey shall mean a survey of any Mortgaged Property (and all improvements thereon) which is
(a) (i) prepared by a surveyor or engineer licensed to perform surveys in the jurisdiction where
such Mortgaged Property is located, (ii) current as of a date which shows all exterior construction
on the site of such Mortgaged Property or any easement, right of way or other interest in the
Mortgaged Property has been granted or become effective through operation of law or otherwise with
respect to such Mortgaged Property which, in either case, can be depicted on a survey, unless
otherwise acceptable to the Collateral Agent, (iii) certified by the surveyor (in a manner
reasonably acceptable to the Administrative Agent) to the Administrative Agent, the Collateral
Agent and the Title Company, (iv) complying in all respects with the minimum detail requirements of
the American Land Title Association (or the local equivalent) as such requirements are in effect on
the date of preparation of such survey and (v) sufficient for the Title Company to remove all
standard survey exceptions from the title insurance policy (or commitment) relating to such
Mortgaged Property and issue the endorsements of the type required by Section 4.01(o)(iii)
or (b) otherwise reasonably acceptable to the Collateral Agent.
Swingline Exposure shall mean at any time the sum of (a) U.S. Swingline Exposure
plus (b) European Swingline Exposure.
Swingline Lender mean, individually and collectively, as the context may require, the U.S.
Swingline Lender and the European Swingline Lender.
Swingline Loan shall mean any loan made by a Swingline Lender pursuant to Section
2.17.
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Swiss Borrower shall have the meaning assigned to such term in the preamble hereto.
Swiss Borrowing Base shall mean at any time an amount equal to the sum of the Dollar
Equivalent of, without duplication:
(i) the book value of Eligible Large Customer German Accounts, multiplied by the advance rate
of 85%, plus
(ii) the book value of Eligible Small Customer German Accounts, multiplied by the Applicable
Percentage (as defined in the German Receivables Purchase Agreement), multiplied by the advance
rate of 85%, plus
(iii) the book value of Eligible Swiss Subsidiary Accounts, multiplied by an advance rate of
up to 85%, to be determined by the Administrative Agent in its sole discretion, minus
(iv) any Reserves established from time to time by the Administrative Agent with respect to
the Swiss Borrowing Base in accordance with Section 2.01(d) and the other terms of this
Agreement.
The Swiss Borrowing Base at any time shall be determined by reference to the most recent
Borrowing Base Certificate theretofore delivered to the Administrative Agent with such adjustments
as Administrative Agent deems appropriate in its Permitted Discretion to assure that the Swiss
Borrowing Base is calculated in accordance with the terms of this Agreement.
Swiss francs or CHF shall mean lawful money of Switzerland.
Swiss Franc Denominated Loan shall mean each European Swingline Loan denominated in Swiss
Francs at the time of the incurrence thereof.
Swiss Guarantor shall mean each Restricted Subsidiary of Parent Borrower organized in
Switzerland (other than the Swiss Borrower) party hereto as a Guarantor, and each other Restricted
Subsidiary of Parent Borrower organized in Switzerland that is required to become a Guarantor
pursuant to the terms hereof.
Swiss Loan Party shall mean the Swiss Borrower or a Swiss Guarantor.
Swiss Non-Qualifying Bank shall mean a (Swiss or non-Swiss) Person that does not qualify as
a Swiss Qualifying Bank.
Swiss Qualifying Bank shall mean a (Swiss or non-Swiss) financial institution which (i)
qualifies as a bank pursuant to the banking laws in force in its country of incorporation, (ii)
carries on a true banking activity in such jurisdiction as its main purpose, and (iii) has
personnel, premises, communication devices and decision-making authority of its own, all as per the
guidelines of the Swiss Federal Tax Administration No. S-02.122.1(4.99), No. S-02.122.2(4.99),
S-02-123(9.86), No. S-02.128(1.2000) and No. S-02.130(4.99) or legislation or guidelines addressing
the same issues which are in force at such time.
81
Swiss Receivables Purchase Agreement shall have the meaning assigned to such term in the
definition of Receivables Purchase Agreement.
Swiss Revolving Exposure shall mean, with respect to any Lender at any time, the Dollar
Equivalent of the aggregate principal amount at such time of all outstanding Swiss Revolving Loans
of such Lender, plus the Dollar Equivalent of the aggregate amount at such time of such Lenders
European LC Exposure, plus the Dollar Equivalent of the aggregate amount at such time of such
Lenders European Swingline Exposure.
Swiss Revolving Loan shall have the meaning assigned to such term in Section
2.01(a).
Swiss Security Agreement shall mean, collectively, any Security Agreement substantially in
the form of Exhibit M-4, including all subparts thereto, among the Swiss Loan Parties and
the Collateral Agent for the benefit of the Secured Parties.
Swiss Seller shall mean each of Novelis Switzerland SA and Novelis Technology AG, each a
company organized under the laws of Switzerland, and any other Subsidiary Guarantor that is a
Restricted Grantor organized in Switzerland (including each in its roles as seller and collection
agent under a Swiss Receivables Purchase Agreement).
Swiss Withholding Tax shall mean any withholding tax in accordance with the Swiss Federal
Statute on Anticipatory Tax of 13 October 1965 (Bundesgesetz uber die Verrechnungssteuer) and any
successor provision, as appropriate.
Syndication Agent shall have the meaning assigned to such term in the preamble hereto.
Syndication Period shall have the meaning assigned to such term in the definition of
Eligible Assignee.
Synthetic Lease Obligation means the monetary obligation of a Person under a so-called
synthetic, off-balance sheet or tax retention lease.
TARGET2 shall mean the Trans-European Automated Real-time Gross Settlement Express Transfer
payment system that utilizes a single shared platform and which was launched on November 19, 2007
(or any successor payment system).
TARGET Day shall mean any day on which TARGET2 is open for the settlement of payments in
Euro.
Tax Deduction has the meaning assigned to such term in Section 2.15(i).
Tax Return shall mean all returns, statements, filings, attachments and other documents or
certifications required to be filed in respect of Taxes.
Taxes shall mean all present or future taxes, levies, imposts, duties, deductions,
withholdings, payroll, social security, employment and unemployment taxes, assessments, fees or
other charges imposed by any Taxing Authority, including any interest, additions to tax or
82
penalties applicable thereto. For greater certainty it shall further be specified that Taxes shall
also include any federal, cantonal and municipal direct taxes levied at source in Switzerland as
per Article 51 § 1 lit. d and Article 94 of the Swiss Federal Direct Tax Act of December 14, 1990
and as per Article 21 § 2 lit. a and Article 35 § lit. e of the Swiss Federal Harmonization
Direct Tax Act of December 14, 1990.
Taxing Authority shall mean any Governmental Authority of any jurisdiction or political
subdivision thereof with the authority to impose, assess, and collect Taxes and engage in
activities of a similar nature with respect to such Taxing Authority.
Ten Non-Bank Regulations shall mean the regulations pursuant to the guidelines No.
S-02.122.1(4.99), No. S-02.128(1.2000) and No. S-02.130.1(4.99) of the Swiss Federal Tax
Administration (or legislation or guidelines addressing the same issues which are in force at such
time) pursuant to which the aggregate number of Lenders of a Swiss Borrower under this Agreement
which are not Swiss Qualifying Banks shall not at any time exceed ten.
Term Loan Administrative Agent shall mean Bank of America, in its capacity as administrative
agent under the Term Loan Credit Agreement, and its successors and assigns in such capacity.
Term Loan Collateral Agent shall mean Bank of America, in its capacity as collateral agent
under the Term Loan Credit Agreement, and its successors and assigns in such capacity.
Term Loan Credit Agreement shall mean (i) that certain credit agreement dated as of the date
hereof among the Loan Parties party thereto, the lenders party thereto, the Arranger, as lead
arranger, and Bank of America, as administrative agent and as collateral agent for the Term Loan
Secured Parties, as amended, restated, supplemented, increased or modified from time to time
(including any increase permitted pursuant to Section 2.23 of the Term Loan Credit Agreement or any
similar provision in any Term Loan Credit Agreement Refinancing Indebtedness) to the extent not
prohibited by this Agreement or the Intercreditor Agreement and (ii) any other credit agreement,
loan agreement, note agreement, promissory note, indenture or other agreement or instrument
evidencing or governing the terms of any indebtedness or other financial accommodation that has
been incurred to extend (subject to the limitations set forth herein and in the Intercreditor
Agreement) or refinance in whole or in part the indebtedness and other obligations outstanding
under the (x) credit agreement referred to in clause (i) or (y) any subsequent Term Loan Credit
Agreement, in each case which constitutes a Permitted Term Loan Facility Refinancing with respect
to the Term Loans, unless such agreement or instrument expressly provides that it is not intended
to be and is not a Term Loan Credit Agreement hereunder. Any reference to the Term Loan Credit
Agreement hereunder shall be deemed a reference to any Term Loan Credit Agreement then in
existence.
Term Loan Credit Agreement Refinancing Indebtedness means (a) Permitted First Priority
Refinancing Debt, (b) Permitted Second Priority Refinancing Debt, (c) Permitted Unsecured
Refinancing Debt or (d) Indebtedness incurred pursuant to a Refinancing Amendment (as defined in
the Term Loan Credit Agreement), in each case, issued, incurred or otherwise obtained (including by
means of the extension or renewal of existing Indebtedness) in exchange for, or to extend, renew,
replace or refinance, in whole or part, existing Term Loans
83
(including any successive Term Loan
Credit Agreement Refinancing Indebtedness) (Refinanced Debt); provided that (i) such
extending, renewing or refinancing Indebtedness is in an original aggregate principal amount not
greater than the aggregate principal amount of the
Refinanced Debt, (ii) such Indebtedness has a later maturity and a Weighted Average Life to
Maturity equal to or greater than the Refinanced Debt, and (iii) such Refinanced Debt shall be
repaid, defeased or satisfied and discharged, and all accrued interest, fees and premiums (if any)
in connection therewith shall be paid, on the date such Term Loan Credit Agreement Refinancing
Indebtedness is issued, incurred or obtained.
Term Loan Documents shall mean the Term Loan Credit Agreement and the other Loan Documents
as defined in the Term Loan Credit Agreement and any corresponding term in any successor Term Loan
Agreement permitted hereby, including the mortgages and other security documents, guaranties and
the notes issued thereunder.
Term Loan Obligations shall mean the Term Loans and the guarantees by the Loan Parties under
the Term Loan Documents.
Term Loans shall mean, collectively, the Loans, Incremental Term Loans and the Other
Term Loans, each as defined in the Term Loan Credit Agreement (or any similar term in any Term
Loan Credit Agreement Refinancing Indebtedness).
Test Period shall mean, at any time, the four consecutive fiscal quarters of Parent Borrower
then last ended (in each case taken as one accounting period).
Title Company shall mean any title insurance company as shall be retained by Borrower and
reasonably acceptable to the Administrative Agent.
Title Policy shall have the meaning assigned to such term in Section 4.01(o)(iii).
Total Adjusted Borrowing Base shall mean, at any time, the sum of (i) the U.S. Borrowing
Base at such time, plus (ii) the Canadian Borrowing Base at such time, plus (iii) the lesser of (A)
the U.K. Borrowing Base and (B) the greater of (I) $350,000,000 and (II) 40% of the Total Gross
Borrowing Base, minus (without duplication) (iv) Reserves against the Total Borrowing Base
or any component thereof (other than the Swiss Borrowing Base).
Total Adjusted Revolving Exposure shall mean, at any time, the Total Revolving Exposure
minus Swiss Revolving Exposure.
Total Borrowing Base shall mean, at any time, the sum of (i) the U.S. Borrowing Base at such
time, plus (ii) the Canadian Borrowing Base at such time, plus (iii) the European Borrowing
Base at such time, minus (without duplication) (iv) Reserves against the Total Borrowing
Base or any component thereof.
Total Gross Borrowing Base shall mean, at any time, the sum of (i) the U.S. Borrowing Base
at such time, plus (ii) the Canadian Borrowing Base at such time, plus (iii) the Swiss
Borrowing Base at such time, plus (iv) the U.K. Borrowing Base at such time.
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Total European Revolving Exposure shall mean, at any time, the sum of the Total Swiss
Revolving Exposure and Total U.K. Revolving Exposure at such time.
Total Net Leverage Ratio shall mean, with respect to any Calculation Date, the ratio of (a)
Consolidated Total Net Debt as of the Calculation Date to (b) Consolidated EBITDA (Leverage) for
the Test Period most recently ended prior to the Calculation Date for which financial information
has been delivered to the Administrative Agent and the Lenders pursuant to Section 5.01(a)
or (b).
Total Revolving Commitment shall mean, at any time, the sum of the Revolving Commitments of
each of the Lenders at such time.
Total Revolving Exposure shall mean, at any time, the sum of the Revolving Exposure of each
of the Lenders at such time.
Total Swiss Revolving Exposure shall mean, at any time, the sum of the Swiss Revolving
Exposure of each of the Lenders at such time.
Total U.K. Revolving Exposure shall mean, at any time, the sum of the U.K. Revolving
Exposure of each of the Lenders at such time.
Total U.S. Revolving Exposure shall mean, at any time, the sum of the U.S. Revolving
Exposure of each of the Lenders at such time.
Transaction Documents shall mean the Loan Documents, the New Senior Note Documents and the
Term Loan Documents.
Transactions shall mean, collectively, the transactions to occur pursuant to or in
connection with the Transaction Documents, including (a) the execution and delivery of the Loan
Documents and the initial borrowings hereunder; (b) the Refinancing; (c) the execution and delivery
of the Term Loan Documents and the borrowings thereunder; (d) the execution and delivery of the New
Senior Note Documents on the Closing Date and the receipt by Parent Borrower of at least
$2,500,000,000 in gross proceeds from the sale of the New Senior Notes, (e) the consummation of the
Debt Tender Offer, (f) the payment of the Closing Date Distribution and (g) the payment of all fees
and expenses to be paid on or prior to the Closing Date and owing in connection with the foregoing.
Transferred Guarantor shall have the meaning assigned to such term in Section 7.09.
Treaty Lender shall have the meaning assigned to such term in clause (C) of the definition
of U.K. Qualifying Lender.
Twenty Non-Bank Regulations shall mean the regulations pursuant to the guidelines No.
S-02.122.1(4.99), No. S-02.122.2(4.99), No. S-02.128(1.2000) and No. S-02.130.1(4.99) of the Swiss
Federal Tax Administration (or legislation or guidelines addressing the same issues which are in
force at such time) pursuant to which the aggregate number of persons and legal entities, which are
not Swiss Qualifying Banks and to which the Swiss Borrower directly or indirectly, including,
without limitation, through a Restricted Sub-Participation or other
85
sub-participations under any
other agreement, owes interest-bearing borrowed money under all interest-bearing instruments
including, inter alia, this Agreement, taken together (other than bond
issues which are subject to Swiss Withholding Tax), shall not exceed twenty at any time in
order to not trigger Swiss Withholding Tax.
Type, when used in reference to any Loan or Borrowing, refers to whether the rate of
interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the
Adjusted EURIBOR Rate, the Adjusted LIBOR Rate, or the Base Rate (in each case with regard to a
Loan of a given currency).
UCC shall mean the Uniform Commercial Code as in effect from time to time in the State of
New York; provided that if perfection or the effect of perfection or non-perfection or the priority
of any security interest in any Collateral is governed by the Uniform Commercial Code as in effect
in a jurisdiction other than the State of New York, UCC shall mean the Uniform Commercial Code as
in effect from time to time in such other jurisdiction for purposes of the provisions hereof
relating to such perfection, effect of perfection or non-perfection or priority.
U.K. Borrower shall have the meaning assigned to such term in the preamble hereto.
U.K. Borrowing Base shall mean at any time an amount equal to the sum of the Dollar
Equivalent of, without duplication:
(i) the book value of Eligible U.K. Accounts multiplied by the advance rate of 85%,
plus
(ii) the lesser of (i) the advance rate of 75% of the Cost of Eligible U.K. Inventory, or (ii)
the advance rate of 85% of the Net Recovery Cost Percentage multiplied by the Cost of Eligible U.K.
Inventory, minus
(iii) any Reserves established from time to time by the Administrative Agent with respect to
the U.K. Borrowing Base in accordance with Section 2.01(d) and the other terms of this
Agreement.
The U.K. Borrowing Base at any time shall be determined by reference to the most recent
Borrowing Base Certificate theretofore delivered to the Administrative Agent with such adjustments
as Administrative Agent deems appropriate in its Permitted Discretion to assure that the U.K.
Borrowing Base is calculated in accordance with the terms of this Agreement.
U.K. Guarantor shall mean each Restricted Subsidiary of Parent Borrower incorporated in
England and Wales (other than the U.K. Borrower) party hereto as a Guarantor, and each other
Restricted Subsidiary of Parent Borrower incorporated in England and Wales that is required to
become a Guarantor pursuant to the terms hereof.
U.K. Loan Party shall mean each of the U.K. Borrower and each U.K. Guarantor.
U.K. Qualifying Lender shall mean a Lender which is beneficially entitled to interest
payable to that Lender in respect of an advance under this Agreement or any other Loan Document and
is:
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|
(i) |
|
which is a bank (as defined for
the purpose of Section 879 of the United Kingdom Income Tax Act
2007) making an advance under this Agreement or any other Loan
Document, or |
|
(ii) |
|
in respect of an advance made
under this Agreement or any other Loan Document by a person that
was a bank (as defined for the purpose of Section 879 of the
United Kingdom Income Tax Act 2007) at the time that that
advance was made, |
|
|
|
|
and which is within the charge to United Kingdom corporation
tax as respects any payments of interest made in respect of
that advance; or |
|
(i) |
|
a company resident in the United
Kingdom for United Kingdom tax purposes; |
|
(ii) |
|
a partnership each member of
which is either: |
|
(I) |
|
a company
resident in the United Kingdom for United Kingdom tax
purposes; or |
|
|
(II) |
|
a company not so
resident in the United Kingdom which carries on a trade
in the United Kingdom through a permanent establishment
and which is required to bring into account in computing
its chargeable profits (within the meaning of Section 19
of the United Kingdom Corporation Tax Act 2009) the
whole of any share of interest payable in respect of
that advance that falls to it by reason of Part 17 of
the United Kingdom Corporation Tax Act 2009; or |
|
(iii) |
|
a company not so resident in the
United Kingdom which carries on a trade in the United Kingdom
through a permanent establishment and which brings into account
that interest payable in respect of that advance in computing
the chargeable profits (for the purposes of Section 19 of the
United Kingdom Corporation Tax Act 2009) of that company; or |
87
|
(i) |
|
is treated as a resident of a
jurisdiction having a double taxation agreement with the United
Kingdom which makes
provision for full exemption from tax imposed by the United
Kingdom on interest for the purposes of the treaty; and |
|
(ii) |
|
does not carry on a business in
the United Kingdom through a permanent establishment with which
the Lenders participation in the Loan is effectively connected
(a Treaty Lender). |
U.K. Revolving Exposure shall mean, with respect to any Lender at any time, the Dollar
Equivalent of the aggregate principal amount at such time of all outstanding U.K. Revolving Loans
of such Lender.
U.K. Revolving Loan shall have the meaning assigned to such term in Section 2.01(a).
U.K. Security Agreement shall mean, collectively, any Security Agreement substantially in
the form of Exhibit M-3, including all subparts thereto, among the U.K. Loan Parties and
the Collateral Agent for the benefit of the Secured Parties, including the U.K. Share Charge.
U.K. Share Charge shall mean shall mean a Security Agreement in substantially the form of
Exhibit M-3-2, among the Parent Borrower and the Collateral Agent.
United States shall mean the United States of America.
Unpaid Supplier Reserve shall mean, at any time, with respect to the Canadian Loan Parties,
the amount equal to the percentage applicable to Inventory in the calculation of the Canadian
Borrowing Base multiplied by the aggregate value of the Eligible Inventory which the Administrative
Agent, in its Permitted Discretion, considers is or may be subject to a right of a supplier to
repossess goods pursuant to Section 81.1 of the Bankruptcy and Insolvency Act (Canada) or any other
laws of Canada or any other applicable jurisdiction granting revendication or similar rights to
unpaid suppliers, in each case, where such suppliers right ranks or is capable of ranking in
priority to or pari passu with one or more of the First Priority Liens granted in the Security
Documents.
Unrestricted Cash shall mean cash and Cash Equivalents of the Parent Borrower and its
Restricted Subsidiaries (in each case, free and clear of all Liens, other than Liens permitted
pursuant to Section 6.02(a), (j) and (k)), to the extent the use thereof
for the application to payment of Indebtedness is not prohibited by law or any contract to which
the Parent Borrower or any of the Restricted Subsidiaries is a party and excluding cash and Cash
Equivalents (i) which are listed as restricted on the consolidated balance sheet of the Parent
Borrower and its Subsidiaries as of such date or (ii) constituting proceeds of a Specified Equity
Contribution.
Unrestricted Grantors shall mean Loan Parties that are not Restricted Grantors.
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Unrestricted Subsidiary shall mean any Subsidiary of the Parent Borrower designated by the
board of directors of the Parent Borrower as an Unrestricted Subsidiary pursuant to Section
5.17 subsequent to the Closing Date.
U.S. Borrower shall mean each Initial U.S. Borrower, and each other Subsidiary (which is
organized under the laws of the United States or any state thereof or the District of Columbia)
that is or becomes a party to this Agreement as a U.S. Borrower pursuant to Section 5.11.
U.S. Borrowing Base shall mean at any time an amount equal to the sum of, without
duplication:
(i) the book value of Eligible U.S. Accounts multiplied by the advance rate of 85%,
plus
(ii) the lesser of (i) the advance rate of 75% of the Cost of Eligible U.S. Inventory, or (ii)
the advance rate of 85% of the Net Recovery Cost Percentage multiplied by the Cost of Eligible U.S.
Inventory, minus
(iii) any Reserves established from time to time by the Administrative Agent with respect to
the U.S. Borrowing Base in accordance with Section 2.01(d) and the other terms of this
Agreement.
The U.S. Borrowing Base at any time shall be determined by reference to the most recent
Borrowing Base Certificate theretofore delivered to the Administrative Agent with such adjustments
as Administrative Agent deems appropriate in its Permitted Discretion to assure that the U.S.
Borrowing Base is calculated in accordance with the terms of this Agreement.
U.S. GAAP shall have the meaning assigned to such term in Section 1.04.
U.S. LC Exposure shall mean at any time the Dollar Equivalent of the sum of the stated
amount of all outstanding U.S. Letters of Credit at such time. The U.S. LC Exposure of any
Revolving Lender at any time shall mean its Pro Rata Percentage of the aggregate U.S. LC Exposure
at such time.
U.S. Letter of Credit shall have the meaning assigned to such term in Section
2.18(a).
U.S. Reimbursement Obligations shall mean each applicable Borrowers obligations under
Section 2.18 to reimburse LC Disbursements in respect of U.S. Letters of Credit.
U.S. Revolving Exposure shall mean, with respect to any Revolving Lender at any time, the
Dollar Equivalent of the aggregate principal amount at such time of all outstanding U.S Revolving
Loans of such Lender, plus the Dollar Equivalent of the aggregate amount at such time of such
Lenders U.S. LC Exposure, plus the Dollar Equivalent of the aggregate amount at such time of such
Lenders U.S. Swingline Exposure.
U.S. Revolving Loan shall have the meaning assigned to such term in Section 2.01(a).
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U.S. Security Agreement shall mean a Security Agreement substantially in the form of
Exhibit M-1 among the U.S. Borrowers and the Collateral Agent for the benefit of the
Secured Parties.
U.S. Swingline Exposure shall mean at any time the aggregate principal amount at such time
of all outstanding U.S. Swingline Loans. The U.S. Swingline Exposure of any Revolving Lender at
any time shall equal its Pro Rata Percentage of the aggregate U.S. Swingline Exposure at such time.
U.S. Swingline Lender shall have the meaning assigned to such term in the preamble hereto.
U.S. Swingline Loan shall have the meaning assigned to such term in Section 2.17(a).
Vendor Managed Inventory shall mean Inventory of a U.S. Borrower, a Canadian Loan Party, or
an Eligible U.K. Loan Party located in the ordinary course of business of such Loan Party at a
customer location that has been disclosed to the Administrative Agent in Schedule 3.24 or
in a Borrowing Base Certificate or updates to the Perfection Certificate.
Voting Stock shall mean, with respect to any person, any class or classes of Equity
Interests pursuant to which the holders thereof have the general voting power under ordinary
circumstances to elect at least a majority of the Board of Directors of such person.
Weighted Average Life to Maturity shall mean, when applied to any Indebtedness at any date,
the number of years obtained by dividing: (a) the sum of the products obtained by multiplying (i)
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 (ii) the
number of years (calculated to the nearest one-twelfth) that will elapse between such date and the
making of such payment; by (b) the then outstanding principal amount of such Indebtedness.
Wholly Owned Subsidiary shall mean, as to any person, (a) any corporation 100% of whose
capital stock (other than directors qualifying shares) is at the time owned by such person and/or
one or more Wholly Owned Subsidiaries of such person and (b) any partnership, association, joint
venture, limited liability company or other entity in which such person and/or one or more Wholly
Owned Subsidiaries of such person have a 100% equity interest at such time.
Wind-Up shall have the meaning assigned to such term in Section 6.05(g), and
Winding-Up shall have a meaning correlative thereto.
Withdrawal Liability shall mean liability to a Multiemployer Plan as a result of a complete
or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle
E of Title IV of ERISA.
SECTION 1.02 Classification of Loans and Borrowings. For purposes of this Agreement, Loans may be
classified and referred to by Class or Sub-Class (e.g., a U.S. Revolving Loan or a Swiss
Revolving Loan) or by Type (e.g., a Eurocurrency Loan) or by Class (or Sub-Class) and Type
(e.g., a Eurocurrency U.S. Revolving Loan). Borrowings also
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may be classified and referred to by
Class or Sub-Class (e.g., a U.K. Borrowing,) or by Type (e.g., a Base Rate Borrowing) or by
Class or Sub-Class and Type (e.g., a Eurocurrency U.S. Borrowing).
SECTION 1.03 Terms Generally; Alternate Currency Transaction. The definitions of terms herein shall
apply equally to the singular and plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine, feminine and neuter forms. The
words include, includes and including shall be deemed to be followed by the phrase without
limitation. The word will shall be construed to have the same meaning and effect as the word
shall. Unless the context requires otherwise (a) any definition of or reference to any Loan
Document, agreement, instrument or other document herein shall be construed as referring to such
agreement, instrument or other document (including any Organizational Document) as from time to
time amended, supplemented or otherwise modified (subject to any restrictions on such amendments,
supplements or modifications set forth herein or in any other Loan Document), (b) any reference
herein to any person shall be construed to include such persons successors and assigns, (c) any
reference to a Subsidiary of a Person shall include any direct or indirect Subsidiary of such
Person, (d) the words herein, hereof and hereunder, and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular provision hereof,
(e) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer
to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (f) any reference to
any law or regulation herein shall include all statutory and regulatory provisions consolidating,
amendment or interpreting such law or regulation and any reference to any law or regulation shall,
unless otherwise specified, refer to such law or regulation as amended, modified or supplemented
from time to time, (g) the words asset and property shall be construed to have the same meaning
and effect and to refer to any and all tangible and intangible assets and properties, including
cash, securities, accounts and contract rights and (h) on, when used with respect to the
Mortgaged Property or any property adjacent to the Mortgaged Property, means on, in, under, above
or about. For purposes of this Agreement and the other Loan Documents, (i) where the
permissibility of a transaction or determinations of required actions or circumstances depend upon
compliance with, or are determined by reference to, amounts stated in Dollars, such amounts shall
be deemed to refer to Dollars or Dollar Equivalents and any requisite currency translation shall be
based on the Spot Selling Rate in effect on the Business Day immediately preceding the date of such
transaction or determination and the permissibility of actions taken under ARTICLE VI shall
not be affected by subsequent fluctuations in exchange rates (provided that if Indebtedness is
incurred to refinance other Indebtedness, and such refinancing would cause the applicable Dollar
denominated limitation to be exceeded if calculated at the Spot Selling Rate in effect on the
Business Day immediately preceding the date of such refinancing, such Dollar denominated
restriction shall be deemed not to have been exceeded so long as (x) such refinancing Indebtedness
is denominated in the same currency as such Indebtedness being refinanced and (y) the principal
amount of such refinancing Indebtedness does not exceed the principal amount of such Indebtedness
being refinanced except as permitted by the definition of Permitted Refinancing Indebtedness) and
(ii) as of any date of determination, for purposes of the pro rata application of any amounts
required to be applied hereunder to the payment of Loans or other Obligations which are denominated
in more than a single Approved Currency, such pro rata application shall be determined by reference
to the Dollar Equivalent of such Loans or other Obligations as of such date of determination. For
purposes of this Agreement and the other Loan Documents, the word
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foreign shall refer to
jurisdictions other than the United States, the states thereof and the District of Columbia. For
purposes of this Agreement and the other Loan Documents, the words the applicable borrower (or
words of like import), when used with reference to obligations of
any U.S. Borrower, shall refer to the U.S. Borrowers on a joint and several basis. From and after
the effectiveness of the Permitted Holdings Amalgamation (x) all references to the Parent Borrower
in any Loan Document shall refer to the Successor Parent Borrower and (y) all references to
Holdings in any Loan Document shall refer to Successor Holdings. Each reference to the Issuing
Bank shall refer to the applicable Issuing Bank or Issuing Banks, as the context may require.
SECTION 1.04 Accounting Terms; GAAP. Except as otherwise expressly provided herein, all financial
statements to be delivered pursuant to this Agreement shall be prepared in accordance with
generally accepted accounting principles in the United States applied on a consistent basis as in
effect from time to time (U.S. GAAP) and all terms of an accounting or financial nature shall be
construed and interpreted in accordance with U.S. GAAP, as in effect from time to time unless
otherwise agreed to by Parent Borrower and the Required Lenders or as set forth below; provided
that (i) the Parent Borrower may elect to convert from U.S. GAAP for the purposes of preparing its
financial statements and keeping its books and records to IFRS and if the Parent Borrower makes
such election it shall give prompt written notice to the Administrative Agent and the Lenders
within five Business Days of such election, along with a reconciliation of the Parent Borrowers
financial statements covering the four most recent fiscal quarters for which financial statements
are available (including a reconciliation of the Parent Borrowers audited financial statements
prepared during such period), (ii) upon election of any conversion to IFRS, the Administrative
Agent, the Lenders and the Parent Borrower shall negotiate in good faith to amend the financial
ratios and requirements and other terms of an accounting or a financial nature in the Loan
Documents to preserve the original intent thereof in light of such conversion to IFRS (subject to
the approval of the Required Lenders); provided that, until so amended (x) such ratios or
requirements (and all terms of an accounting or a financial nature) shall continue to be computed
in accordance with U.S. GAAP prior to such conversion to IFRS and (y) the Parent Borrower shall
provide to the Administrative Agent and the Lenders any documents and calculations required under
this Agreement or as reasonably requested hereunder by the Administrative Agent or any Lender
setting forth a reconciliation between calculations of such ratios and requirements and other terms
of an accounting or a financial nature made before and after giving effect to such conversion to
IFRS and (iii) if at any time any change in U.S. GAAP or change in IFRS would affect the
computation of any financial ratio or requirement or other terms of an accounting or a financial
nature set forth in any Loan Document, and the Parent Borrower or the Required Lenders shall so
request, the Administrative Agent, the Lenders and the Parent Borrower shall negotiate in good
faith to amend such ratio or requirement or other terms of an accounting or a financial nature to
preserve the original intent thereof in light of such change in U.S. GAAP or change in IFRS
(subject to the approval of the Required Lenders); provided that, until so amended, (x)
such ratio or requirement or other terms of an accounting or a financial nature shall continue to
be computed in accordance with U.S. GAAP prior to such change therein or change in IFRS and (y) the
Parent Borrower shall provide to the Administrative Agent and the Lenders any documents required
under this Agreement or as reasonably requested hereunder setting forth a reconciliation between
calculations of such ratio or requirement or other terms of an accounting or a financial nature
made before and after giving effect to such change in U.S. GAAP or change in IFRS. Notwithstanding
the foregoing, for
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purposes of determining compliance with any covenant (including the computation of any
financial covenant) contained herein, Indebtedness of Holdings, the Parent Borrower and its
Subsidiaries shall be deemed to be carried at 100% of the outstanding principal amount thereof, and
the effects of FASB ASC 825 on financial liabilities shall be disregarded.
SECTION 1.05 Resolution of Drafting Ambiguities. Each Loan Party acknowledges and agrees that it was
represented by counsel in connection with the execution and delivery of the Loan Documents to which
it is a party, that it and its counsel reviewed and participated in the preparation and negotiation
hereof and thereof and that any rule of construction to the effect that ambiguities are to be
resolved against the drafting party shall not be employed in the interpretation hereof or thereof.
SECTION 1.06 Pro Forma Calculations. Notwithstanding anything to the contrary herein, the Total Net
Leverage Ratio and the Senior Secured Net Leverage Ratio shall be calculated on a Pro Forma Basis
(Leverage) with respect to each Specified Transaction occurring during the applicable four quarter
period to which such calculation relates, or subsequent to the end of such four-quarter period but
not later than the date of such calculation.
ARTICLE II
THE CREDITS
SECTION 2.01 Commitments.
(a) Subject to the terms and conditions and relying upon the representations and warranties
herein set forth, each Lender with a Revolving Commitment agrees, severally and not jointly, at
any time and from time to time on or after the Closing Date until the earlier of the Business
Day prior to the Maturity Date and the termination of the Revolving Commitment of such Lender in
accordance with the terms hereof, to make revolving loans (x) to the U.S. Borrowers, jointly and
severally, or to the Parent Borrower, in any Approved Currency (each, a U.S. Revolving Loan),
(y) to the Swiss Borrower, in euros or GBP (each, a Swiss Revolving Loan), and (z) to the U.K.
Borrower, in euros or GBP (each, a U.K. Revolving Loan and, collectively with the Swiss
Revolving Loans and the U.S. Revolving Loans, each a Revolving Loan), in an aggregate
principal amount that does not result in:
(i) such Lenders Revolving Exposure exceeding such Lenders Revolving Commitment less such
Lenders ratable portion of Availability Reserves;
(ii) the Total Adjusted Revolving Exposure exceeding the Total Adjusted Borrowing Base
(subject to the Administrative Agents authority in its sole discretion to make Overadvances
pursuant to the terms of Section 2.01(e)); or
(iii) the Total Revolving Exposure exceeding the lesser of (I) the Total Borrowing Base
(subject to the Administrative Agents authority in its sole discretion to make Overadvances
pursuant to the terms of Section 2.01(e)), and (II) the Total Revolving Commitment less
Availability Reserves.
(b) [intentionally omitted.]
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(c) Within the limits set forth above and subject to the terms, conditions and limitations
set forth herein, the Borrowers may borrow, pay or prepay and reborrow Revolving Loans.
(d) Notwithstanding anything to the contrary in this Agreement, the Administrative Agent
shall have the right to establish Availability Reserves against the Commitments, and/or
Availability Reserves and other Reserves against the Borrowing Base, in each case in such
amounts, and with respect to such matters, as the Administrative Agent in its Permitted
Discretion shall deem necessary, including, without limitation (but without duplication), (i)
sums that the respective Borrowers or Borrowing Base Guarantors are or will be required to pay
(such as taxes (including payroll and sales taxes), assessments, insurance premiums, or, in the
case of leased assets, rents or other amounts payable under such leases) and have not yet paid,
(ii) amounts owing by the respective Borrowers or Borrowing Base Guarantors or, without
duplication, their respective Subsidiaries to any Person in respect of any Lien of the type
described in the definition of First Priority on any of the Collateral, which Lien, in the
Permitted Discretion of the Administrative Agent, is reasonably likely to rank senior in
priority to or pari passu with one or more of the Liens granted in the Security Documents in and
to such item of the Collateral, (iii) an Unpaid Supplier Reserve and a Reserve against prior
claims of Logan, in each case, against Eligible Inventory included in the Borrowing Base, (iv)
an Inventory Reserve, in each case, against Eligible Inventory included in the Borrowing Base,
(v) Rent Reserves and Reserves for Priority Payables, (vi) a Bank Product Reserve, and (vii) a
Dilution Reserve; provided, however, that (y) the amount of any Reserve
established by the Administrative Agent shall have a reasonable relationship to the event,
condition or other matter that is the basis for the Reserve, and (z) Reserves shall not
duplicate eligibility criteria contained in the definitions of Eligible Accounts or Eligible
Inventory or reserves or criteria deducted in computing the cost of Eligible Inventory or the
Net Recovery Cost Percentage of Eligible Inventory. The Administrative Agent shall provide the
Administrative Borrower with at least three (3) Business Days prior written notice of any such
establishment. Upon delivery of written notice to Administrative Borrower, the Administrative
Agent shall be available to discuss the proposed Reserve, and the applicable Borrower or
Borrowing Base Guarantor may take such action as may be required so that the event, condition or
matter that is the basis for such Reserve no longer exists, in a manner and to the extent
reasonably satisfactory to the Administrative Agent in the exercise of its Permitted Discretion.
In no event shall such notice and opportunity limit the right of the Administrative Agent to
establish such Reserve, unless the Administrative Agent shall have determined in its Permitted
Discretion that the event, condition or other matter that is the basis for such new Reserve no
longer exists or has otherwise been adequately addressed.
(e) The Administrative Agent shall not, without the prior consent of the Required Lenders,
make (and shall use its reasonable best efforts to prohibit the Issuing Banks and Swingline
Lenders, as applicable, from making) any Revolving Loans or Swingline Loans, or provide any
Letters of Credit, to the Borrowers on behalf of Lenders intentionally and with actual knowledge
that such Revolving Loans, Swingline Loans, or Letters of Credit would either (i) cause the
Total Revolving Exposure to exceed the lesser of (a) the Total Borrowing Base, and (b) the Total
Revolving Commitment less Availability Reserves, (ii) cause the Total Adjusted Revolving
Exposure to exceed the Total Adjusted Borrowing Base, or (iii) be made when one or more of the
other conditions precedent to the making of Loans hereunder cannot
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be satisfied, except that Administrative Agent may make (or cause to be made) such
additional Revolving Loans (including U.S. Swingline Loans) or European Swingline Loans or
provide such additional Letters of Credit on behalf of Lenders (each an Overadvance and
collectively, the Overadvances), intentionally and with actual knowledge that such Loans or
Letters of Credit will be made without the satisfaction of the foregoing conditions precedent,
if the Administrative Agent deems it necessary or advisable in its discretion to do so;
provided, that: (A) the total principal amount outstanding at any time of Overadvances
to the Borrowers which Administrative Agent may make or provide (or cause to be made or
provided) after obtaining such actual knowledge that the conditions precedent have not been
satisfied, shall not (I) exceed the amount equal to 5% of the Total Borrowing Base, or, when
aggregated with all Credit Protective Advances then outstanding, 7.5% of the Total Borrowing
Base, and (II) shall not, without the consent of all Lenders, cause the Total Revolving Exposure
to exceed the Total Revolving Commitment of all of the Lenders less Availability Reserves, or
such Lenders Pro Rata Percentage of the Total Revolving Exposure to exceed such Lenders
Revolving Commitment less such Lenders Pro Rata Percentage of Availability Reserves, (B)
without the consent of all Lenders, (I) no Overadvance shall be outstanding for more than sixty
(60) days and (II) after all Overadvances have been repaid, Administrative Agent shall not make
any additional Overadvance unless sixty (60) days or more have elapsed since the last date on
which any Overadvance was outstanding and (C) Administrative Agent shall be entitled to recover
such funds on demand from the applicable Borrower or Borrowers together with interest thereon
for each day from the date such payment was due until the date such amount is paid to
Administrative Agent at the interest rate otherwise applicable to Loans of such Class and Type
(including interest at the Default Rate, if applicable). Each Lender of the applicable Class
shall be obligated to pay Administrative Agent the amount of its Pro Rata Percentage of any such
Overadvance, provided, that such Administrative Agent is acting in accordance with the
terms of this Section 2.01(e). Overadvances shall constitute Revolving Loans (or
European Swingline Loans), shall be payable on demand and shall constitute Obligations secured
by the Collateral entitled to all the benefits of the Loan Documents. Any funding of an
Overadvance or sufferance of an Overadvance shall not constitute a waiver by any Agent or any
Lender of the Event of Default caused thereby. In no event shall any Borrower be deemed a
beneficiary of this Section 2.01(e) nor authorized to enforce any of its terms.
(f) The Administrative Agent shall be authorized, in its discretion, at any time that any
conditions in Section 4.02 are not satisfied, to make Base Rate Loans (Protective
Advances) (i) if the Administrative Agent deems such Loans necessary or desirable to preserve
or protect Collateral, or to enhance the collectibility or repayment of Obligations (Credit
Protective Advances), provided, that the total principal amount outstanding at any time
of Credit Protective Advances shall not exceed the amount equal to 5% of the Total Borrowing
Base, or, when aggregated with all Overadvances then outstanding, 7.5% of the Total Borrowing
Base, or (ii) to pay any other amounts chargeable to the Loan Parties under any Loan Documents,
including costs, fees and expenses; provided further, that the total principal
amount outstanding at any time of Protective Advances shall not, without the consent of all
Lenders, cause the Total Revolving Exposure to exceed the Total Revolving Commitment of all of
the Lenders less Availability Reserves, or such Lenders Pro Rata Percentage of the Total
Revolving Exposure to exceed such Lenders Revolving Commitment less such Lenders Pro Rata
Percentage of Availability Reserves. Each Lender shall
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participate in each Protective Advance in accordance with its Pro Rata Percentage.
Required Lenders may at any time revoke Administrative Agents authority to make further
Protective Advances by written notice to the Administrative Agent. Absent such revocation, the
Administrative Agents determination that funding of a Protective Advance is appropriate shall
be conclusive.
SECTION 2.02 Loans.
(a) Each Loan (other than Swingline Loans) shall be made as part of a Borrowing consisting
of Loans made by the Lenders ratably in accordance with their applicable Commitments;
provided, that the failure of any Lender to make its Loan shall not in itself relieve
any other Lender of its obligation to lend hereunder (it being understood, however, that no
Lender shall be responsible for the failure of any other Lender to make any Loan required to be
made by such other Lender). Except for Swingline Loans, Protective Advances and Loans deemed
made pursuant to Section 2.18, each Borrowing shall be in an aggregate principal amount
that is not less than (and in integral amounts consistent with) the Minimum Currency Threshold
or, if less, equal to the remaining available balance of the applicable Commitments.
(b) Subject to Section 2.11 and Section 2.12, (i) each Borrowing of Dollar
Denominated Loans shall be comprised entirely of Base Rate Loans or Eurocurrency Loans as
Administrative Borrower may request pursuant to Section 2.03 (provided that Base
Rate Loans shall be available only with respect to Dollar Denominated Loans borrowed by U.S.
Borrowers or Parent Borrower), (ii) each Borrowing of GBP Denominated Loans or Swiss Franc
Denominated Loans shall be comprised entirely of Eurocurrency Loans, and (iii) each Borrowing of
Euro Denominated Loans shall be comprised entirely of EURIBOR Loans; provided that all
Loans comprising the same Borrowing shall at all times be of the same Type. Each Lender may at
its option make any Eurocurrency Loan or EURIBOR Loan by causing any domestic or foreign branch
or Affiliate of such Lender to make such Loan; provided that any exercise of such option
shall not affect the obligation of the applicable Borrower to repay such Loan in accordance with
the terms of this Agreement; and provided, further, that with respect to any
Loan (and so long as no Event of Default shall have occurred and is continuing), if such Lender
is a Swiss Qualifying Bank, such branch or Affiliate must also qualify as a Swiss Qualifying
Bank. Borrowings of more than one Type may be outstanding at the same time; provided
that Borrower shall not be entitled to request any Borrowing that, if made, would result in more
than eight Eurocurrency Borrowings in Dollars, five Eurocurrency Borrowings in GBP, or eight
EURIBOR Borrowings outstanding hereunder at any one time. For purposes of the foregoing,
Borrowings having different Interest Periods, regardless of whether they commence on the same
date, shall be considered separate Borrowings.
(c) Except with respect to Loans deemed made pursuant to Section 2.18(b) and
Swingline Loans, each Lender shall make each Loan to be made by it hereunder on the proposed
date thereof by wire transfer of immediately available funds to such account in Chicago, or to
such account in a European jurisdiction, as the Administrative Agent may designate, not later
than 12:00 noon, New York time (11:00 a.m., London time in the case of Revolving Loans made in
GBP or Euros), and the Administrative Agent shall promptly credit the amounts so received to an
account of the applicable Borrower as directed by the
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Administrative Borrower in the applicable Borrowing Request maintained with the
Administrative Agent or, if a Borrowing shall not occur on such date because any condition
precedent herein specified shall not have been met, return the amounts so received to the
respective Lenders.
(d) Unless the Administrative Agent shall have received notice from a Lender prior to the
date of any Borrowing that such Lender will not make available to the Administrative Agent such
Lenders portion of such Borrowing, the Administrative Agent may assume that such Lender has
made such portion available to the Administrative Agent on the date of such Borrowing in
accordance with paragraph (c) above, and the Administrative Agent may, in reliance upon such
assumption, make available to the applicable Borrower on such date a corresponding amount. If
the Administrative Agent shall have so made funds available, then, to the extent that such
Lender shall not have made such portion available to the Administrative Agent, each of such
Lender and such Borrower severally agrees to repay to the Administrative Agent forthwith on
demand such corresponding amount together with interest thereon, for each day from the date such
amount is made available to such Borrower until the date such amount is repaid to the
Administrative Agent at (i) in the case of such Borrower, the interest rate applicable at the
time to the Loans comprising such Borrowing and (ii) in the case of such Lender, the greater of
the Interbank Rate and a rate determined by the Administrative Agent in accordance with banking
industry rules on interbank compensation. If such Lender shall repay to the Administrative
Agent such corresponding amount, such amount shall constitute such Lenders Loan as part of such
Borrowing for purposes of this Agreement, and the applicable Borrowers obligation to repay the
Administrative Agent such corresponding amount pursuant to this Section 2.02(d) shall
cease.
(e) Notwithstanding anything to the contrary contained herein, no Borrower shall be
entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period
requested with respect thereto would end after the Maturity Date.
SECTION 2.03 Borrowing Procedure.
(a) To request a Borrowing (subject to Section 2.17(e) with respect to European
Swingline Loans), the Administrative Borrower, on behalf of the applicable Borrower, shall
deliver, by hand delivery, telecopier or, to the extent separately agreed by the Administrative
Agent, by an electronic communication in accordance with the second sentence of Section
11.01(b) and the second paragraph of Section 11.01(d), a duly completed and executed
Borrowing Request to the Administrative Agent (i) in the case of a Eurocurrency Borrowing (other
than a Eurocurrency Borrowing made in GBP), not later than 12:00 noon, New York time, three (3)
Business Days before the date of the proposed Borrowing, (ii) in the case of a EURIBOR
Borrowing, or a Eurocurrency Borrowing made in GBP, not later than 11:00 a.m., London time,
three (3) Business Days before the date of the proposed Borrowing, or (iii) in the case of a
Base Rate Borrowing, not later than 12:00 a.m., New York time, on the date of the proposed
Borrowing. Each Borrowing Request shall be irrevocable and shall specify the following
information in compliance with Section 2.02:
(i) the aggregate amount of such Borrowing;
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(ii) the date of such Borrowing, which shall be a Business Day;
(iii) whether such Borrowing shall constitute a Borrowing of U.S. Revolving Loans, U.K.
Revolving Loans or Swiss Revolving Loans;
(iv) in the case of Dollar Denominated Loans made to U.S. Borrowers or to Parent Borrower,
whether such Borrowing is to be a Base Rate Borrowing or a Eurocurrency Borrowing;
(v) in the case of U.S. Revolving Loans, whether such Borrowing is to be made to the U.S.
Borrowers or the Parent Borrower;
(vi) in the case of a Eurocurrency Borrowing or EURIBOR Borrowing, the initial Interest Period
to be applicable thereto, which shall be a period contemplated, as applicable, by the definition of
the term Eurocurrency Interest Period or EURIBOR Interest Period;
(vii) the location and number of the applicable Borrowers account to which funds are to be
disbursed, which shall comply with the requirements of Section 2.02(c);
(viii) that the conditions set forth in Section 4.02(b) (d) have been
satisfied as of the date of the notice; and
(ix) in the case of a Eurocurrency Borrowing in an Alternate Currency, the Approved Currency
for such Borrowing.
If no election as to the Type of Borrowing is specified with respect to a Borrowing of Dollar
Denominated Loans made to U.S. Borrowers or to Parent Borrower, then the requested Borrowing shall
be a Base Rate Borrowing. If no Interest Period is specified with respect to any requested EURIBOR
Borrowing or Eurocurrency Borrowing, then the Administrative Borrower on behalf of the applicable
Borrower shall be deemed to have selected an Interest Period of one months duration. Promptly
following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent
shall advise each applicable Lender of the details thereof and of the amount of such Lenders Loan
to be made as part of the requested Borrowing.
(b) Appointment of Administrative Borrower. Each Borrower hereby irrevocably
appoints and constitutes Administrative Borrower as its agent to request Loans and Letters of
Credit pursuant to this Agreement in the name or on behalf of such Borrower. The Administrative
Agent and Lenders may disburse the Loans to such bank account of Administrative Borrower or a
Borrower or otherwise make such Loans to a Borrower and provide such Letters of Credit to a
Borrower as Administrative Borrower may designate or direct, without notice to any other
Borrower or Guarantor. Each Loan Party hereby irrevocably appoints and constitutes
Administrative Borrower as its agent to receive statements of account and all other notices from
the Agents and Lenders with respect to the Obligations or otherwise under or in connection with
this Agreement and the other Loan Documents, including the Intercreditor Agreement. Any notice,
election, representation, warranty, agreement or undertaking by or on behalf of any other Loan
Party by Administrative Borrower shall be deemed for all purposes to have been made by such Loan
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Party, as the case may be, and shall be binding upon and enforceable against such Loan
Party to the same extent as if made directly by such Loan Party. Administrative Borrower hereby
accepts the appointment by Borrowers and the other Loan Parties to act as the agent of Borrowers
and the other Loan Parties and agrees to ensure that the disbursement of any Loans to a Borrower
requested by or paid to or for the account of such Borrower, or the issuance of any Letter of
Credit for a Borrower hereunder, shall be paid to or for the account of such Borrower. No
purported termination of the appointment of Administrative Borrower as agent as aforesaid shall
be effective, except after ten (10) days prior written notice to Administrative Agent and
appointment by the Borrowers of a replacement Administrative Borrower.
(c) Appointment of European Administrative Borrower. Each U.K. Borrower and Swiss
Borrower hereby irrevocably appoints and constitutes European Administrative Borrower as its
agent to request Loans and Letters of Credit pursuant to this Agreement in the name or on behalf
of such Borrower. The Administrative Agent and Lenders may disburse the Loans to such bank
account of European Administrative Borrower or a U.K. Borrower or Swiss Borrower or otherwise
make such Loans to a U.K. Borrower or Swiss Borrower and provide such Letters of Credit to a
U.K. Borrower or Swiss Borrower as European Administrative Borrower may designate or direct,
without notice to any other Borrower or Guarantor. Each U.K. Borrower and Swiss Borrower hereby
irrevocably appoints and constitutes European Administrative Borrower as its agent to receive
statements of account and all other notices from the Agents and Lenders with respect to the
Obligations or otherwise under or in connection with this Agreement and the other Loan
Documents. Any notice, election, representation, warranty, agreement or undertaking by or on
behalf of any other Borrower by European Administrative Borrower shall be deemed for all
purposes to have been made by such Borrower, as the case may be, and shall be binding upon and
enforceable against such Borrower to the same extent as if made directly by such Borrower.
European Administrative Borrower hereby accepts the appointment by the U.K. Borrowers and Swiss
Borrowers to act as the agent of such Borrowers and agrees to ensure that the disbursement of
any Loans to a U.K. Borrower or Swiss Borrower requested by or paid to or for the account of
such Borrower, or the issuance of any Letter of Credit for a U.K. Borrower or Swiss Borrower
hereunder, shall be paid to or for the account of such Borrower. No purported termination of
the appointment of European Administrative Borrower as agent as aforesaid shall be effective,
except after ten (10) days prior written notice to Administrative Agent and appointment by the
U.K. Borrowers and Swiss Borrowers of a replacement European Administrative Borrower.
(d) Unless payment is otherwise timely made by Borrowers within three (3) Business Days of
the due date (after the lapse of any applicable grace periods) of any Secured Obligations
(whether principal, interest, fees or other charges, including Extraordinary Expenses, LC
Obligations, cash collateral and Secured Bank Product Obligations), Borrower shall be deemed to
have requested Base Rate Revolving Loans on such third Business Day in the amount of such
Secured Obligations. The proceeds of such Revolving Loans shall be disbursed as direct payment
of the relevant Secured Obligation.
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SECTION 2.04 Evidence of Debt.
(a) Promise to Repay. Each U.S. Borrower, jointly and severally, hereby
unconditionally promises to pay on the Maturity Date to the Administrative Agent, for the
account of each applicable Revolving Lender (or, in the case of U.S. Swingline Loans, the U.S.
Swingline Lender in accordance with Section 2.17(a)), the then unpaid principal amount
of each U.S. Revolving Loan of such Revolving Lender made to any U.S. Borrower. The Parent
Borrower hereby unconditionally promises to pay on the Maturity Date to the Administrative
Agent, for the account of each applicable Revolving Lender, the then unpaid principal amount of
each U.S. Revolving Loan of such Revolving Lender made to the Parent Borrower. The Swiss
Borrower hereby unconditionally promises to pay (i) on the Maturity Date to the Administrative
Agent, for the account of each applicable Revolving Lender, the then unpaid principal amount of
each Swiss Revolving Loan of such Revolving Lender and (ii) on the earlier of the Maturity Date
and the last day of the Interest Period for such Loan, to the European Swingline Lender, the
then unpaid principal amount of each European Swingline Loan. The U.K. Borrower hereby
unconditionally promises to pay on the Maturity Date to the Administrative Agent, for the
account of each applicable Revolving Lender, the then unpaid principal amount of each U.K.
Revolving Loan of such Revolving Lender. All payments or repayments of Loans made pursuant to
this Section 2.04(a) shall be made in the Approved Currency in which such Loan is
denominated.
(b) Lender and Administrative Agent Records. Each Lender shall maintain in
accordance with its usual practice an account or accounts evidencing the Indebtedness of each
Borrower to such Lender resulting from each Loan made by such Lender from time to time,
including the amounts of principal and interest payable and paid to such Lender from time to
time under this Agreement. The Administrative Agent shall maintain accounts in which it will
record (i) the amount and Approved Currency of each Loan made hereunder, the Borrower or
Borrowers to which such Loan is made, the Type, Class and Sub-Class thereof and the Interest
Period applicable thereto; (ii) the amount of any principal or interest due and payable or to
become due and payable from each Borrower to each Lender hereunder; and (iii) the amount of any
sum received by the Administrative Agent hereunder for the account of the Lenders and each
Lenders share thereof. The entries made in the accounts maintained pursuant to this paragraph
shall be prima facie evidence of the existence and amounts of the obligations therein recorded
as well as the Borrower or Borrowers which received such Loans or Letters of Credit; provided
that the failure of any Lender or the Administrative Agent to maintain such accounts or any
error therein shall not in any manner affect the obligations of any Borrower to repay the Loans
in accordance with their terms.
(c) Promissory Notes. Any Lender by written notice to the Administrative Borrower
(with a copy to the Administrative Agent) may request that Loans of any Class and Sub-Class made
by it be evidenced by a promissory note. In such event, the applicable Borrower or Borrowers
shall prepare, execute and deliver to such Lender one or more promissory notes payable to such
Lender or its registered assigns in the form of Exhibit K-1 or K-2, as the case may be.
Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times
(including after assignment pursuant to Section 11.04) be represented by one or more
promissory notes in such form payable to such payee or its registered assigns. If, because of
fluctuations in exchange rates after the date of issuance thereof, any such Note would not be at
least as great as the Dollar Equivalent of the outstanding principal amount of the Loans made by
such Lender evidenced thereby at any
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time outstanding, such Lender may request (and in such case the applicable Borrowers shall
promptly execute and deliver) a new Note in an amount equal to the Dollar Equivalent of the
aggregate principal amount of such Loans of such Lender outstanding on the date of the issuance
of such new Note.
SECTION 2.05 Fees.
(a) Commitment Fee. The Borrowers, jointly and severally, agree to pay to the
Administrative Agent for the account of each Lender having a Revolving Commitment a commitment
fee (a Commitment Fee) denominated in Dollars on the actual daily amount by which the Total
Revolving Commitment exceeds the Total Revolving Exposure, from and including the date hereof to
but excluding the date on which such Revolving Commitment terminates at a rate per annum equal
to the Applicable Fee. Accrued Commitment Fees shall be payable in arrears (A) on the first
Business Day of each month, commencing January 1, 2011, and (B) on the date on which such
Revolving Commitment terminates. Commitment Fees shall be computed on the basis of a year of
360 days and shall be payable for the actual number of days elapsed (including the first day but
excluding the last day). For purposes of computing Commitment Fees with respect to Revolving
Commitments, a Revolving Commitment of a Lender shall be deemed to be used to the extent of the
outstanding Revolving Loans, Swingline Exposure and LC Exposure of such Lender.
(b) Fee Letter. Parent Borrower agrees to pay or to cause the applicable Borrower
to pay all Fees payable pursuant to the Fee Letter, in the amounts and on the dates set forth
therein.
(c) LC and Fronting Fees. The applicable Borrower agrees to pay (i) to the
Administrative Agent for the account of each Lender having a Revolving Commitment a
participation fee (LC Participation Fee) with respect to its participations in Letters of
Credit, which shall accrue at a rate equal to the Applicable Margin from time to time used to
determine the interest rate on (A) with regard to Letters of Credit denominated in Dollars,
Canadian Dollars or GBP, Eurocurrency Loans, and (B) with regard to Letters of Credit
denominated in euros, EURIBOR Loans, in each case pursuant to Section 2.06 on the
average daily amount of such Lenders LC Exposure (excluding any portion thereof attributable to
Reimbursement Obligations) during the period from and including the Closing Date to but
excluding the later of the date on which such Lenders Revolving Commitment terminates and the
date on which such Lender ceases to have any LC Exposure, and (ii) to the applicable Issuing
Bank a fronting fee (Fronting Fee), which shall accrue at the rate of 0.125% per annum on the
average daily amount of the LC Exposure of such Issuing Bank (excluding any portion thereof
attributable to Reimbursement Obligations) during the period from and including the Closing Date
to but excluding the later of the date of termination of the Revolving Commitments and the date
on which such Issuing Bank ceases to have any LC Exposure, as well as such Issuing Banks
customary fees with respect to the issuance, amendment, renewal or extension of any Letter of
Credit or processing of drawings thereunder. Accrued LC Participation Fees and Fronting Fees
shall be payable in arrears (i) on the first Business Day of each month, commencing on January
1, 2011, and (ii) on the date on which the Revolving Commitments terminate. Any such fees
accruing after the date on which the Revolving Commitments terminate shall be payable on demand.
Any other fees
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payable to an Issuing Bank pursuant to this paragraph shall be payable within ten (10) days
after demand therefor. All LC Participation Fees and Fronting Fees shall be computed on the
basis of a year of 360 days and shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). If at any time any principal of or
interest on any Loan or any fee or other amount payable by the Loan Parties hereunder has not
been paid when due, whether at stated maturity, upon acceleration or otherwise, the LC
Participation Fee shall be increased to a per annum rate equal to 2% plus the otherwise
applicable rate with respect thereto for so long as such overdue amounts have not been paid.
(d) All Fees shall be paid on the dates due, in immediately available funds in Dollars, to
the Administrative Agent for distribution, if and as appropriate, among the Lenders, except that
Borrowers shall pay the Fronting Fees directly to the applicable Issuing Bank. Once paid, none
of the Fees shall be refundable under any circumstances.
SECTION 2.06 Interest on Loans.
(a) Base Rate Loans. Subject to the provisions of Section 2.06(f), the
Loans comprising each Base Rate Borrowing, including each U.S. Swingline Loan, shall bear
interest at a rate per annum equal to the Base Rate plus the Applicable Margin in effect from
time to time.
(b) Eurocurrency Loans. Subject to the provisions of Section 2.06(f), the Loans
comprising each Eurocurrency Borrowing, including each European Swingline Loan, shall bear
interest at a rate per annum equal to the Adjusted LIBOR Rate for the Interest Period in effect
for such Borrowing plus the Applicable Margin in effect from time to time.
(c) [intentionally omitted].
(d) [intentionally omitted].
(e) EURIBOR Loans. Subject to the provisions of Section 2.06(f), the Loans
comprising each EURIBOR Borrowing shall bear interest at a rate per annum equal to the Adjusted
EURIBOR Rate for the Interest Period in effect for such Borrowing plus the Applicable Margin in
effect from time to time.
(f) Default Rate. Notwithstanding the foregoing, during an Event of Default of the
type specified in Sections 8.01(a), (b), (g) or (h), or during
any other Event of Default if the Required Lenders in their discretion so elect by notice to the
Administrative Agent, all Obligations shall, to the extent permitted by Applicable Law, bear
interest, after as well as before judgment, at a per annum rate equal to (i) in the case of
principal of or interest on any Loan, 2% plus the rate otherwise applicable to such Loan
as provided in the preceding paragraphs of this Section 2.06 or (ii) in the case of any
other amount, 2% plus the rate applicable to Base Rate Loans as provided in Section
2.06(a) (in either case, the Default Rate).
(g) Interest Payment Dates. Accrued interest on each Loan shall be payable in
arrears on each Interest Payment Date for such Loan; provided that (i) interest accrued pursuant
to Section 2.06(f) shall be payable on demand, (ii) in the event of any repayment or
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prepayment of any Loan (other than a prepayment of a Base Rate Revolving Loan or a U.S.
Swingline Loan without a permanent reduction in Revolving Commitments), accrued interest on the
principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment
and (iii) in the event of any conversion of any EURIBOR Loan or Eurocurrency Loan prior to the
end of the current Interest Period therefor, accrued interest on such Loan shall be payable on
the effective date of such conversion.
(h) Interest Calculation. All interest hereunder shall be computed on the basis of
a year of 360 days, except that (i) interest computed by reference to the Base Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and (ii) interest
computed with regard to Eurocurrency Loans by way of GBP shall be computed on the basis of a
year of 365 days, and in each case shall be payable for the actual number of days elapsed
(including the first day but excluding the last day). The applicable Base Rate, Adjusted
EURIBOR Rate or Adjusted LIBOR Rate shall be determined by the Administrative Agent in
accordance with the provisions of this Agreement and such determination shall be conclusive
absent manifest error.
(i) Currency for Payment of Interest. All interest paid or payable pursuant to
this Section 2.06 shall be paid in the Approved Currency in which the Loan giving rise
to such interest is denominated.
(j) Swiss Minimum Interests Rates and Payments. The various rates of interests
provided for in this Agreement (including, without limitation, under this Section 2.06)
are minimum interest rates.
(i) When entering into this Agreement, each party hereto has assumed that the payments
required under this Agreement are not and will not become subject to Swiss Withholding Tax.
Notwithstanding that the parties hereto do not anticipate that any payment will be subject to Swiss
Withholding Tax, they agree that, if (A) Swiss Withholding Tax should be imposed on interest or
other payments (the Relevant Amount) by a Swiss Loan Party and (B) Section 2.15 should be
held unenforceable, then the applicable interest rate in relation to that interest payment shall
be: (x) the interest rate which would have been applied to that interest payment (as provided for
in the absence of this Section 2.06(j); divided by (y) 1 minus the minimal
permissible rate at which the relevant Tax Deduction is required to be made in view of domestic tax
law and/or applicable treaties (where the rate at which the relevant Tax Deduction is required to
be made is, for this purpose, expressed as a fraction of one (1)) and all references to a rate of
interest under such Loan shall be construed accordingly. For this purpose, the Swiss Withholding
Tax shall be calculated on the amount so recalculated.
(ii) The Swiss Borrower shall not be required to make an increased payment to any specific
Lender (but without prejudice to the rights of all other Lenders hereunder) under paragraph (i)
above or under Section 2.15 in connection with a Swiss Withholding Tax if the Swiss
Borrower has breached the Ten Non-Bank Regulations and/or Twenty Non-Bank Regulations as a direct
result of (A) the incorrectness of the representation made by such Lender pursuant to Section
2.21 if such Lender specified that it was a Swiss Qualifying Bank or (B) such Lender, as
assignee or participant, breaching the requirements and limitations for transfers,
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assignments or participations pursuant to Section 11.04 or (C) if Section 2.15
does not provide for an obligation to make increased payments.
(iii) For the avoidance of doubt, the Swiss Borrower shall be required to make an increased
payment to a specific Lender under paragraph (i) above in connection with the imposition of a Swiss
Withholding Tax (A) if the Swiss Borrower has breached the Ten Non-Bank Regulations and/or the
Twenty Non-Bank Regulations as a result of its failure to comply with the provisions of Section
5.15 or, (B) if after an Event of Default, lack of compliance with the Ten Non-Bank Regulations
and/or the Twenty Non-Bank Regulations as a result of assignments or participation effected in
accordance herewith, or (C) following a change of law or practice in relation with the Ten Non-Bank
Regulations and/or the Twenty Non-Bank Regulations Swiss Withholding Tax becomes due on interest
payments made by Swiss Borrower and Section 2.15 is not enforceable.
(iv) If requested by the Administrative Agent, a Swiss Loan Party shall provide to the
Administrative Agent those documents which are required by law and applicable double taxation
treaties to be provided by the payer of such tax for each relevant Lender to prepare a claim for
refund of Swiss Withholding Tax. In the event Swiss Withholding Tax is refunded to the Lender by
the Swiss Federal Tax Administration, the relevant Lender shall forward, after deduction of costs,
such amount to the Swiss Loan Party; provided, however, that (i) the relevant Swiss
Loan Party has fully complied with its obligations under this Section 2.06(j); (ii) the
relevant Lender may determine, in its sole discretion, consistent with the policies of such Lender,
the amount of the refund attributable to Swiss Withholding Tax paid by the relevant Swiss Loan
Party; (iii) nothing in this Agreement shall require the Lender to disclose any confidential
information to the Swiss Loan Party (including, without limitation, its tax returns); and (iv) no
Lender shall be required to pay any amounts pursuant to this Section 2.06(j)(iv) at any
time during which a Default or Event of Default exists.
SECTION 2.07 Termination and Reduction of Commitments.
(a) Termination of Commitments. The Revolving Commitments, the European Swingline
Commitment and the LC Commitment shall automatically terminate on the Maturity Date.
(b) Optional Terminations and Reductions. At its option, Administrative Borrower
may at any time terminate, or from time to time permanently reduce, the Commitments of any
Class; provided that (i) each reduction of the Commitments of any Class shall be in an
amount that is an integral multiple of $1,000,000 and not less than $5,000,000 and (ii) the
Revolving Commitments shall not be terminated or reduced if, after giving effect to any
concurrent prepayment of the Revolving Loans in accordance with Section 2.10, the
aggregate amount of Revolving Exposure would exceed the aggregate amount of Revolving
Commitments, or the Total Revolving Exposure would exceed the Total Revolving Commitment.
(c) Borrower Notice. Administrative Borrower shall notify the Administrative Agent
in writing of any election to terminate or reduce the Commitments under Section 2.07(b)
at least three (3) Business Days prior to the effective date of such termination or
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reduction, specifying such election and the effective date thereof. Promptly following
receipt of any notice, the Administrative Agent shall advise the Lenders of the contents
thereof. Each notice delivered by Administrative Borrower pursuant to this Section
shall be irrevocable; provided that a notice of termination of the Commitments delivered
by Administrative Borrower may state that such notice is conditioned upon the effectiveness of
other credit facilities, in which case such notice may be (subject to payment of any amount
pursuant to Section 2.13) revoked by Administrative Borrower (by notice to the
Administrative Agent on or prior to the specified effective date) if such condition is not
satisfied. Any termination or reduction of the Commitments of any Class shall be permanent.
Each reduction of the Commitments of any Class shall be made ratably among the Lenders in
accordance with their respective Commitments of such Class.
SECTION 2.08 Interest Elections.
(a) Generally. Each Borrowing initially shall be of the Type specified in the
applicable Borrowing Request and, in the case of a EURIBOR Borrowing or Eurocurrency Borrowing,
shall have an initial Interest Period as specified in such Borrowing Request. Thereafter,
Administrative Borrower may elect to convert such Borrowing to a different Type (in the case of
Dollar Denominated Loans made to U.S. Borrowers or to Parent Borrower, to a Base Rate Borrowing
or a Eurocurrency Borrowing) or to rollover or continue such Borrowing and, in the case of a
EURIBOR Borrowing or Eurocurrency Borrowing, may elect Interest Periods therefor, all as
provided in this Section. Borrowings consisting of Alternate Currency Revolving Loans
may not be converted to a different Type. Administrative Borrower may elect different options
with respect to different portions (not less than the Minimum Currency Threshold) of the
affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders
holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be
considered a separate Borrowing. Notwithstanding anything to the contrary, Borrowers shall not
be entitled to request any conversion, rollover or continuation that, if made, would result in
more than eight Eurocurrency Borrowings in Dollars, five Eurocurrency Borrowings in GBP, or
eight EURIBOR Borrowings outstanding hereunder at any one time. This Section shall not
apply to Swingline Loans, which may not be converted or continued.
(b) Interest Election Notice. To make an election pursuant to this
Section, Administrative Borrower shall deliver, by hand delivery or telecopier, a duly
completed and executed Interest Election Request to the Administrative Agent not later than the
time that a Borrowing Request would be required under Section 2.03 if Administrative
Borrower were requesting a Borrowing of the Type resulting from such election to be made on the
effective date of such election. Each Interest Election Request shall be irrevocable. Each
Interest Election Request shall specify the following information in compliance with Section
2.02:
(i) the Borrowing to which such Interest Election Request applies and, if different options
are being elected with respect to different portions thereof, or if outstanding Borrowings are
being combined, allocation to each resulting Borrowing (in which case the information to be
specified pursuant to clauses (iii) and (v) below shall be specified for each resulting Borrowing);
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(ii) the effective date of the election made pursuant to such Interest Election Request, which
shall be a Business Day;
(iii) in the case of Dollar Denominated Loans made to U.S. Borrowers or to Parent Borrower,
whether such Borrowing is to be a Base Rate Borrowing or a Eurocurrency Borrowing;
(iv) [intentionally omitted];
(v) if the resulting Borrowing is a EURIBOR Borrowing or a Eurocurrency Borrowing, the
Interest Period to be applicable thereto after giving effect to such election, which shall be a
period contemplated, as applicable, by the definition of the term EURIBOR Interest Period or
Eurocurrency Interest Period; and
(vi) in the case of a Borrowing consisting of Alternate Currency Revolving Loans, the
Alternate Currency of such Borrowing.
If any such Interest Election Request requests a EURIBOR Borrowing or Eurocurrency Borrowing
but does not specify an Interest Period, then Borrowers shall be deemed to have selected an
Interest Period of one months duration.
Promptly following receipt of an Interest Election Request, the Administrative Agent shall
advise each Lender of the details thereof and of such Lenders portion of each resulting Borrowing.
(c) Automatic Conversion to Base Rate Borrowing. If an Interest Election Request
with respect to a Eurocurrency Borrowing made to U.S. Borrowers or to Parent Borrower in Dollars
is not timely delivered prior to the end of the Interest Period applicable thereto, then, unless
such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing
shall be converted to a Base Rate Borrowing. EURIBOR Borrowings and Eurocurrency Borrowings
denominated in an Alternate Currency, and Eurocurrency Borrowings made to Swiss Borrower or U.K.
Borrower and denominated in Dollars, shall not be converted to a Base Rate Borrowing, but shall
be continued as Loans of the same Type with a one month Interest Period. Notwithstanding any
contrary provision hereof, if an Event of Default has occurred and is continuing, the
Administrative Agent or the Required Lenders may require, by notice to Administrative Borrower,
that (i) no outstanding Borrowing may be converted to or continued as a EURIBOR Borrowing or
Eurocurrency Borrowing and (ii) unless repaid, each Eurocurrency Borrowing (other than a
Borrowing of Alternate Currency Loans or a Eurocurrency Borrowing made to Swiss Borrower or U.K.
Borrower and denominated in Dollars) shall be converted to a Base Rate Borrowing at the end of
the Interest Period applicable thereto.
SECTION 2.09 [intentionally omitted].
SECTION 2.10 Optional and Mandatory Prepayments of Loans.
(a) Optional Prepayments. Borrowers shall have the right at any time and from time
to time to prepay any Borrowing, in whole or in part, subject to the requirements of this
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Section 2.10 and subject to the provisions of Section 9.01(e);
provided that each partial prepayment shall be in a principal amount that is not less
than (and in integral amounts consistent with) the Minimum Currency Threshold or, if less, the
outstanding principal amount of such Borrowing.
(b) Certain Revolving Loan Prepayments.
(i) In the event of the termination of all the Revolving Commitments, each Borrower shall, on
the date of such termination, repay or prepay all its outstanding Borrowings and all its
outstanding Swingline Loans and replace all outstanding Letters of Credit or cash collateralize all
its outstanding Letters of Credit in accordance with the procedures set forth in Section
2.18.
(ii) [intentionally omitted].
(iii) [intentionally omitted].
(iv) In the event of any partial reduction of the Revolving Commitments, then (x) at or prior
to the effective date of such reduction, the Administrative Agent shall notify Administrative
Borrower and the applicable Revolving Lenders of the Total Revolving Exposure after giving effect
thereto and (y) if the Total Revolving Exposure would exceed the Total Revolving Commitment less
Availability Reserves after giving effect to such reduction, each applicable Borrower shall, on the
date of such reduction, act in accordance with Section 2.10(b)(vi) below.
(v) [intentionally omitted].
(vi) In the event that the Total Revolving Exposure at any time exceeds the Total Revolving
Commitment less Availability Reserves then in effect (including on any date on which Dollar
Equivalents are determined pursuant to the definition thereof), each applicable Borrower shall,
without notice or demand, immediately first, repay or prepay its Borrowings and second, replace its
outstanding Letters of Credit or cash collateralize its outstanding Letters of Credit in accordance
with the procedures set forth in Section 2.18, in an aggregate amount sufficient to
eliminate such excess.
(vii) [intentionally omitted].
(viii) In the event that the aggregate LC Exposure exceeds the LC Commitment then in effect
(including on any date on which Dollar Equivalents are determined pursuant to the definition
thereof), each applicable Borrower shall, without notice or demand, immediately replace its
outstanding Letters of Credit or cash collateralize its outstanding Letters of Credit in accordance
with the procedures set forth in Section 2.18, in an aggregate amount sufficient to
eliminate such excess.
(ix) In the event that (A) the Total Revolving Exposure exceeds the Total Borrowing Base then
in effect, or (B) the Total Adjusted Revolving Exposure exceeds the Total Adjusted Borrowing Base
then in effect, each applicable Borrower shall, without notice or demand, immediately first, repay
or prepay its Borrowings, and second, replace its outstanding
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Letters of Credit or cash collateralize its outstanding Letters of Credit in accordance with
the procedures set forth in Section 2.18, in an aggregate amount sufficient to eliminate
such excess; provided that to the extent such excess results solely by reason of a change in
exchange rates, unless a Default or an Event of Default has occurred and is continuing, no Borrower
shall be required to make such repayment, replacement or cash collateralization unless the amount
of such excess is greater than 5% of the Total Borrowing Base or Total Adjusted Borrowing Base, as
the case may be (in which event the applicable Borrowers shall make such replacements or cash
collateralization so as to eliminate such excess in its entirety).
(x) [intentionally omitted].
(xi) In the event an Activation Notice has been given (as contemplated by Section
9.01), Borrowers shall pay all proceeds of Collateral (other than proceeds of Pari Passu
Priority Collateral) into the Collection Account, for application in accordance with Section
9.01(e).
(c) Asset Sales. Not later than three (3) Business Days following the receipt of
any Net Cash Proceeds of any Asset Sale of Revolving Credit Priority Collateral by any Loan
Party (i) outside of the ordinary course of business, (ii) occurring during the existence of any
Event of Default or (iii) at any time after the occurrence of a Cash Dominion Trigger Event and
prior to the subsequent occurrence of a Cash Dominion Recovery Event, Borrowers shall make (in
addition to any prepayments required by Section 2.10(b) (which shall be made regardless
of whether any prepayment is required under this paragraph (c)), prepayments in accordance with
Section 2.10(h) and (i) in an aggregate amount equal to 100% of such Net Cash
Proceeds; provided that no such prepayment shall be required under this Section
2.10(c) with respect to (A) the disposition of property which constitutes a Casualty Event
(in which event Section 2.10(f) shall apply), or (B) Asset Sales for fair market value
resulting in less than $5,000,000 in Net Cash Proceeds in any fiscal year.
(d) [intentionally omitted]
(e) [intentionally omitted]
(f) Casualty Events. Not later than three (3) Business Days following the receipt
of any Net Cash Proceeds from a Casualty Event in respect of Revolving Credit Priority
Collateral by any Loan Party during the occurrence of an Event of Default or at any time after
the occurrence of a Cash Dominion Trigger Event and prior to the subsequent occurrence of a Cash
Dominion Recovery Event, Borrowers shall make (in addition to any prepayments required by
Section 2.10(b) (which shall be made regardless of whether any prepayment is required
under this paragraph (c)), prepayments in accordance with Section 2.10(h) and
(i) in an aggregate amount equal to 100% of such Net Cash Proceeds; provided that no
such prepayment shall be required under this Section 2.10(f) with respect to Casualty
Events resulting in less than $5,000,000 in Net Cash Proceeds in any fiscal year.
(g) [intentionally omitted]
(h) Application of Prepayments. (i) Prior to any optional or mandatory prepayment
hereunder, Administrative Borrower shall select the Borrowing or Borrowings to
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be prepaid and shall specify such selection in the notice of such prepayment pursuant to
Section 2.10(i), subject to the provisions of this Section 2.10(h),
provided that after an Activation Notice has been delivered, Section 9.01(e)
shall apply, provided, further, that notwithstanding the foregoing, after an Event of
Default has occurred and is continuing or after the acceleration of the Obligations, Section
8.03 shall apply. Any mandatory prepayment shall be made without reduction to the Revolving
Commitments.
(ii) Amounts to be applied pursuant to this Section 2.10 to the prepayment of Revolving
Loans by a Borrower shall be applied, as applicable, first to reduce outstanding U.S. Swingline
Loans, and then to reduce other outstanding Base Rate Loans of that Borrower. Any amounts
remaining after each such application shall be applied to prepay EURIBOR Loans or Eurocurrency
Loans, as applicable, of that Borrower. Notwithstanding the foregoing, if the amount of any
prepayment of Loans required under this Section 2.10 shall be in excess of the amount of
the Base Rate Loans (including U.S. Swingline Loans) at the time outstanding (an Excess Amount),
only the portion of the amount of such prepayment as is equal to the amount of such outstanding
Base Rate Loans (including U.S. Swingline Loans) shall be immediately prepaid and, at the election
of Administrative Borrower, the Excess Amount shall be either (A) deposited in an escrow account on
terms satisfactory to the Administrative Agent and applied to the prepayment of EURIBOR Loans or
Eurocurrency Loans on the last day of the then next-expiring Interest Period for EURIBOR Loans or
Eurocurrency Loans; provided that (i) interest in respect of such Excess Amount shall
continue to accrue thereon at the rate provided hereunder for the Loans which such Excess Amount is
intended to repay until such Excess Amount shall have been used in full to repay such Loans and
(ii) at any time while an Event of Default has occurred and is continuing, the Administrative Agent
may, and upon written direction from the Required Lenders shall, apply any or all proceeds then on
deposit to the payment of such Loans in an amount equal to such Excess Amount or (B) prepaid
immediately, together with any amounts owing to the Lenders under Section 2.13.
(i) Notice of Prepayment. Administrative Borrower or European Administrative
Borrower, as applicable, shall notify the Administrative Agent (and, in the case of prepayment
of a Swingline Loan, the Swingline Lender) by written notice of any prepayment hereunder (i) in
the case of prepayment of a Eurocurrency Borrowing (other than a Eurocurrency Borrowing made in
GBP), not later than 12:00 noon, New York time, three (3) Business Days before the date of
prepayment, (i) in the case of prepayment of a EURIBOR Borrowing, or a Eurocurrency Borrowing
made in GBP (in each case other than a European Swingline Loan), not later than 11:00 a.m.,
London time, three (3) Business Days before the date of prepayment, (iii) in the case of
prepayment of a Base Rate Borrowing, not later than 12:00 noon, New York time, one (1) Business
Day before the date of prepayment, (iv) in the case of prepayment of a U.S. Swingline Loan, not
later than 12:00 noon, New York time, on the date of prepayment, and (v) in the case of
prepayment of a European Swingline Loan, not later than 11:00 a.m., Zurich time, on the date of
prepayment. Each such notice shall be irrevocable; provided that, if a notice of
prepayment is given in connection with a conditional notice of termination of the Commitments as
contemplated by Section 2.07, then such notice of prepayment may be revoked if such
termination is revoked in accordance with Section 2.07. Each such notice shall specify
the prepayment date, the principal amount of each Borrowing or portion thereof to be prepaid
and, in the case of a mandatory prepayment, a reasonably detailed calculation of the amount of
such prepayment. Promptly following receipt of any
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such notice (other than a notice relating solely to Swingline Loans), the Administrative
Agent shall advise the Lenders of the contents thereof. Each partial prepayment of any
Borrowing shall be in an amount that would be permitted in the case of a Credit Extension of the
same Type as provided in Section 2.02, except as necessary to apply fully the required
amount of a mandatory prepayment. Each prepayment of a Borrowing shall be applied ratably to
the Loans included in the prepaid Borrowing and otherwise in accordance with this Section
2.10. Prepayments shall be accompanied by accrued interest to the extent required by
Section 2.06.
SECTION 2.11 Alternate Rate of Interest. If prior to the commencement of any Interest Period for a
EURIBOR Borrowing or Eurocurrency Borrowing:
(a) the Administrative Agent determines (which determination shall be final and conclusive
absent manifest error) that adequate and reasonable means do not exist for ascertaining the
Adjusted EURIBOR Rate or Adjusted LIBOR Rate for such Interest Period or that any Alternate
Currency is not available to the Lenders in sufficient amounts to fund any Borrowing consisting
of Alternate Currency Revolving Loans; or
(b) the Administrative Agent is advised in writing by the Required Lenders that the
Adjusted EURIBOR Rate or Adjusted LIBOR Rate for such Interest Period will not adequately and
fairly reflect the cost to such Lenders of making or maintaining their Loans included in such
Borrowing for such Interest Period;
then the Administrative Agent shall give written notice thereof to Administrative Borrower and the
Lenders as promptly as practicable thereafter and, until the Administrative Agent notifies
Administrative Borrower and the Lenders that the circumstances giving rise to such notice no longer
exist, (i) any Interest Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a EURIBOR Borrowing or Eurocurrency Borrowing, as applicable,
shall be ineffective and (ii) if any Borrowing Request requests a Eurocurrency Borrowing in
Dollars, such Borrowing shall be made as a Base Rate Borrowing, and Borrowing Requests for any
affected Alternate Currency Revolving Loans or European Swingline Loans shall not be effective.
SECTION 2.12 Yield Protection; Change in Law Generally.
(a) Increased Costs Generally. If any Change in Law shall:
(i) impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance
charge or similar requirement against assets of, deposits with or for the account of, or credit
extended or participated in, by any Lender (except any reserve requirement reflected in the
Adjusted LIBOR Rate or the Adjusted EURIBOR Rate, as applicable) or any Issuing Bank; or
(ii) impose on any Lender or any Issuing Bank or the interbank market any other condition,
cost or expense affecting this Agreement or EURIBOR Loans or Eurocurrency Loans made by such Lender
or any Letter of Credit or participation therein;
and the result of any of the foregoing shall be to increase the cost to such Lender of making or
maintaining any EURIBOR Loan or any Eurocurrency Loan (or of maintaining its obligation to
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make any such Loan), or to increase the cost to such Lender, such Issuing Bank or such Lenders or
such Issuing Banks holding company, if any, of participating in, issuing or maintaining any Letter
of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or
to reduce the amount of any sum received or receivable by such Lender or such Issuing Bank
hereunder (whether of principal, interest or any other amount), then, upon request of such Lender
or such Issuing Bank, Borrowers will pay to such Lender or such Issuing Bank, as the case may be,
such additional amount or amounts as will compensate such Lender or such Issuing Bank, as the case
may be, for such additional costs incurred or reduction suffered.
(b) Capital Requirements. If any Lender or any Issuing Bank determines (in good
faith, but in its sole absolute discretion) that any Change in Law affecting such Lender or such
Issuing Bank or any lending office of such Lender or such Lenders or such Issuing Banks
holding company, if any, regarding capital requirements has or would have the effect of reducing
the rate of return on such Lenders or such Issuing Banks capital or on the capital of such
Lenders or such Issuing Banks holding company, if any, as a consequence of this Agreement, the
Commitments of such Lender or the Loans made by, or participations in Letters of Credit held by,
such Lender, or the Letters of Credit issued by such Issuing Bank, to a level below that which
such Lender or such Issuing Bank or such Lenders or such Issuing Banks holding company could
have achieved but for such Change in Law (taking into consideration such Lenders or such
Issuing Banks policies and the policies of such Lenders or such Issuing Banks holding company
with respect to capital adequacy), then from time to time Borrowers will pay to such Lender or
such Issuing Bank, as the case may be, such additional amount or amounts as will compensate such
Lender or such Issuing Bank or such Lenders or such Issuing Banks holding company for any such
reduction suffered.
(c) Certificates for Reimbursement. A certificate of a Lender or an Issuing Bank
setting forth the amount or amounts necessary to compensate such Lender or such Issuing Bank or
its holding company, as the case may be, as specified in paragraph (a) or (b) of this
Section 2.12 and delivered to Administrative Borrower shall be conclusive absent
manifest error. Borrowers shall pay such Lender or such Issuing Bank, as the case may be, the
amount shown as due on any such certificate within ten (10) Business Days after receipt thereof.
(d) Delay in Requests. Failure or delay on the part of any Lender or any Issuing
Bank to demand compensation pursuant to this Section 2.12 shall not constitute a waiver
of such Lenders or such Issuing Banks right to demand such compensation; provided that
Borrowers shall not be required to compensate a Lender or an Issuing Bank pursuant to this
Section for any increased costs incurred or reductions suffered more than nine months
prior to the date that such Lender or such Issuing Bank, as the case may be, notifies
Administrative Borrower of the Change in Law giving rise to such increased costs or reductions
and of such Lenders or such Issuing Banks intention to claim compensation therefor (except
that, if the Change in Law giving rise to such increased costs or reductions is retroactive,
then the nine-month period referred to above shall be extended to include the period of
retroactive effect thereof).
(e) Change in Legality Generally. Notwithstanding any other provision of this
Agreement, if any Change in Law shall make it unlawful for any Lender to make or maintain any
Eurocurrency Loan or any EURIBOR Loan, or to give effect to its obligations as
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contemplated hereby with respect to any Eurocurrency Loan or any EURIBOR Loan, then, upon
written notice by such Lender to Administrative Borrower and the Administrative Agent:
(i) the Commitments of such Lender (if any) to fund the affected Type of Loan shall
immediately terminate;
(ii) in the case of Dollar Denominated Loans, (x) such Lender may declare that Eurocurrency
Loans will not thereafter (for the duration of such unlawfulness) be continued for additional
Interest Periods and Base Rate Loans will not thereafter (for such duration) be converted into
Eurocurrency Loans, whereupon any request to convert a Base Rate Borrowing to a Eurocurrency
Borrowing or to continue a Eurocurrency Borrowing for an additional Interest Period shall, as to
such Lender only, be deemed a request to continue a Base Rate Loan as such, or to convert a
Eurocurrency Loan into a Base Rate Loan, as the case may be, unless such declaration shall be
subsequently withdrawn and (y) all such outstanding Eurocurrency Loans made by such Lender shall be
automatically converted to Base Rate Loans on the last day of the then current Interest Period
therefor or, if earlier, on the date specified by such Lender in such notice (which date shall be
no earlier than the last day of any applicable grace period permitted by Applicable Law); and
(iii) in the case of Eurocurrency Loans that are GBP Denominated Loans or Swiss Franc
Denominated Loans, or Dollar Denominated Loans of Swiss Borrower or U.K. Borrower, and in the case
of EURIBOR Loans, the applicable Borrower shall repay all such outstanding Eurocurrency Loans or
EURIBOR Loans, as the case may be, of such Lender on the last day of the then current Interest
Period therefor or, if earlier, on the date specified by such Lender in such notice (which date
shall be no earlier than the last day of any applicable grace period permitted by Applicable Law).
(f) Change in Legality in Relation to Issuing Bank. Notwithstanding any other
provision of this Agreement, if any Change in Law shall make it unlawful for any Issuing Bank to
issue or allow to remain outstanding any Letter of Credit, then, by written notice to
Administrative Borrower and the Administrative Agent:
(i) such Issuing Bank shall no longer be obligated to issue any Letters of Credit; and
(ii) each Borrower shall use its commercially reasonable best efforts to procure the release
of each outstanding Letter of Credit issued by such Issuing Bank.
(g) Increased Tax Costs. If any Change in Law shall subject any Lender or any
Issuing Bank to any (i) Tax of any kind whatsoever with respect to this Agreement, any Letter of
Credit, any participation in a Letter of Credit or any Loan made by it, or change the basis of
taxation of payments to such Lender or such Issuing Bank in respect thereof, or (ii) Tax imposed
on it that is specially (but not necessarily exclusively) applicable to lenders such as such
Lender as a result of the general extent and/or nature of their activities, assets, liabilities,
leverage, other exposures to risk, or other similar factors, including but not limited to the
Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, regulations,
guidelines or directives thereunder or issued in connection therewith, the
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proposed United Kingdom Tax to be known as the bank levy (in respect of which draft
legislation was last published on December 9, 2010) in such form as it may be imposed and as
amended or reenacted, and similar legislation (except, in each case of the foregoing clauses (i)
and (ii), for Indemnified Taxes or Other Taxes covered by Section 2.15 and the
imposition of, or any change in the rate of, any Excluded Tax payable by such Lender;
provided, however, for purposes of this Section 2.12(g), a franchise tax
in lieu of or in substitute of net income taxes shall be treated as an Excluded Tax only if such
franchise tax in lieu of or in substitute of net income taxes is imposed by a state, city or
political subdivision of a state, in each case in the United States, for the privilege of being
organized or chartered in, or doing business in, such state, city or political subdivision of
such state or city in the United States), and the result of any of the foregoing shall be to
increase the cost to such Lender such Issuing Bank of making or maintaining any Loan (or of
maintaining its obligation to make any such Loan), or to increase the cost to such Lender, such
Issuing Bank or such Lenders or such Issuing Banks holding company, if any, of participating
in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate
in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable
by such Lender or such Issuing Bank hereunder (whether of principal, interest or any other
amount), then, upon request of such Lender or such Issuing Bank, Borrowers will pay to such
Lender or such Issuing Bank, as the case may be, such additional amount or amounts as will
compensate such Lender or such Issuing Bank, as the case may be, for such additional costs
incurred or reduction suffered.
SECTION 2.13 Breakage Payments. In the event of (a) the payment or prepayment, whether optional or
mandatory, of any principal of any Eurocurrency Loan or EURIBOR Loan earlier than the last day of
an Interest Period applicable thereto (including as a result of an Event of Default), (b) the
conversion of any Eurocurrency Loan or EURIBOR Loan earlier than the last day of the Interest
Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Revolving
Loan on the date specified in any notice delivered pursuant hereto (whether or not such notice was
validly revoked pursuant to Section 2.07(c)) or (d) the assignment of any Eurocurrency Loan
or EURIBOR Loan earlier than the last day of the Interest Period applicable thereto as a result of
a request by Administrative Borrower pursuant to Section 2.16(c), then, in any such event,
the applicable Borrower shall compensate each Lender for the loss, cost and expense attributable to
such event. In the case of a Eurocurrency Loan or EURIBOR Loan, such loss, cost or expense to any
Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of
(i) the amount of interest which would have accrued on the principal amount of such Loan had such
event not occurred, at the Adjusted LIBOR Rate or the Adjusted EURIBOR Rate that would have been
applicable to such Loan, for the period from the date of such event to the last day of the then
current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for
the period that would have been the Interest Period for such Loan) (excluding, however, the
Applicable Margin included therein, if any), over (ii) the amount of interest which would accrue on
such principal amount for such period at the interest rate which such Lender would bid were it to
bid, at the commencement of such period, for deposits of a comparable currency, amount and period
from other banks in the applicable interbank market. A certificate of any Lender setting forth in
reasonable detail any amount or amounts that such Lender is entitled to receive pursuant to this
Section 2.13 shall be delivered to Administrative Borrower (with a copy to the
Administrative Agent) and shall be conclusive and binding absent manifest error. The applicable
Borrower shall pay such Lender the amount shown as due on any such certificate within five (5) days
after receipt thereof.
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SECTION 2.14 Payments Generally; Pro Rata Treatment; Sharing of Setoffs.
(a) Payments Generally. Each Loan Party shall make each payment required to be
made by it hereunder or under any other Loan Document (whether of principal, interest, fees or
Reimbursement Obligations, or of amounts payable under Section 2.12, Section
2.13, Section 2.15, Section 2.16, Section 2.22 or Section
11.03, or otherwise) on or before the time expressly required hereunder or under such other
Loan Document for such payment (or, if no such time is expressly required, prior to (i) in the
case of payments with respect to Revolving Loans made in GBP or Euros, 12:00 noon, London time,
(ii) in the case of European Swingline Loans, 11:00 a.m. Zurich time), and (iii) with respect to
all other payments, 3:00 p.m., New York time, on the date when due, in immediately available
funds, without condition or deduction for any counterclaim, defense, recoupment or setoff. Any
amounts received after such time on any date may, in the discretion of the Administrative Agent,
be deemed to have been received on the next succeeding Business Day for purposes of calculating
interest thereon. All payments by any Loan Party shall be made to the Administrative Agent at
Agents Account, for the account of the respective Lenders to which such payment is owed, except
payments to be made directly to an Issuing Bank or a Swingline Lender as expressly provided
herein and except that payments pursuant to Section 2.12, Section 2.13,
Section 2.15, Section 2.16, Section 2.22 and Section 11.03 shall
be made directly to the persons entitled thereto and payments pursuant to other Loan Documents
shall be made to the persons specified therein. The Administrative Agent shall distribute any
such payments received by it for the account of any other person to the appropriate recipient
promptly following receipt thereof in like funds as received by the Administrative Agent. If
any payment under any Loan Document shall be due on a day that is not a Business Day, unless
specified otherwise, the date for payment shall be extended to the next succeeding Business Day,
and, in the case of any payment accruing interest, interest thereon shall be payable for the
period of such extension. All payments under each Loan Document shall be made in Dollars,
except as expressly specified otherwise.
(b) Pro Rata Treatment.
(i) Each payment by Borrowers of interest in respect of the Loans of any Class shall be
applied to the amounts of such obligations owing to the Lenders pro rata according to the
respective amounts then due and owing to the Lenders having Commitments of such Class.
(ii) Each payment by Borrowers on account of principal of the Borrowings of any Class shall be
made pro rata according to the respective outstanding principal amounts of the Loans of such Class
then held by the Lenders.
(c) Insufficient Funds. If at any time insufficient funds are received by and
available to the Administrative Agent to pay fully all amounts of principal, Reimbursement
Obligations, interest and fees then due hereunder, such funds shall be applied (i) first, toward
payment of interest and fees then due hereunder, ratably among the parties entitled thereto in
accordance with the amounts of interest and fees then due to such parties, and (ii) second,
toward payment of principal and Reimbursement Obligations then due hereunder, ratably
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among the parties entitled thereto in accordance with the amounts of principal and
Reimbursement Obligations then due to such parties.
(d) Sharing of Set-Off. Subject to the terms of the Intercreditor Agreement, if
any Lender (and/or any Issuing Bank, which shall be deemed a Lender for purposes of this
Section 2.14(d)) shall, by exercising any right of setoff or counterclaim or otherwise,
obtain payment in respect of any principal of or interest on any of its Loans or other
Obligations resulting in such Lenders receiving payment of a proportion of the aggregate amount
of its Loans and accrued interest thereon or other Obligations greater than its pro rata share
thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify
the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations
in the Loans and such other obligations of the other Lenders, or make such other adjustments as
shall be equitable, so that the benefit of all such payments shall be shared by the Lenders
ratably in accordance with the aggregate amount of principal of and accrued interest on their
respective Loans and other amounts owing them, provided that:
(i) if any such participations are purchased and all or any portion of the payment giving rise
thereto is recovered, such participations shall be rescinded and the purchase price restored to the
extent of such recovery, without interest; and
(ii) the provisions of this paragraph shall not be construed to apply to (x) any payment made
by any Loan Party pursuant to and in accordance with the express terms of this Agreement or (y) any
payment obtained by a Lender as consideration for the assignment of or sale of a participation in
any of its Loans or participations in LC Disbursements to any assignee or participant, other than
to any Loan Party or any Subsidiary thereof (as to which the provisions of this paragraph shall
apply).
Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under
Applicable Law, that any Lender acquiring a participation pursuant to the foregoing arrangements
may exercise against such Loan Party rights of setoff and counterclaim with respect to such
participation as fully as if such Lender were a direct creditor of such Loan Party in the amount of
such participation. If under applicable Debtor Relief Laws any Secured Party receives a secured
claim in lieu of a setoff or counterclaim to which this Section 2.14(d) applies, such
Secured Party shall to the extent practicable, exercise its rights in respect of such secured claim
in a manner consistent with the rights to which the Secured Party is entitled under this
Section 2.14(d) to share in the benefits of the recovery of such secured claim.
(e) Borrower Default. Unless the Administrative Agent shall have received notice
from Administrative Borrower prior to the date on which any payment is due to the Administrative
Agent for the account of the Lenders or any Issuing Bank hereunder that the applicable Borrower
will not make such payment, the Administrative Agent may assume that the applicable Borrower has
made such payment on such date in accordance herewith and may, in reliance upon such assumption,
distribute to the Lenders or such Issuing Bank, as the case may be, the amount due. In such
event, if the applicable Borrower has not in fact made such payment, then each of the Lenders or
each Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent
forthwith on demand the amount so distributed to such Lender or such Issuing Bank with interest
thereon, for each day from and including the
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date such amount is distributed to it to but excluding the date of payment to the
Administrative Agent, at the greater of the Interbank Rate and a rate determined by the
Administrative Agent in accordance with banking industry rules on interbank compensation. A
notice of the Administrative Agent to any Lender or the Administrative Borrower with respect to
any amount owing under this Section 2.14(e) shall be conclusive, absent manifest error.
(f) Lender Default. If any Lender shall fail to make any payment required to be
made by it hereunder, including pursuant to Section 2.02(c), Section 2.14(d),
Section 2.14(e), Section 2.17(c), Section 2.17(g), Section 2.18,
Section 10.05, or Section 10.09, then the Administrative Agent may, in its
discretion (notwithstanding any contrary provision hereof), apply any amounts thereafter
received by the Administrative Agent for the account of such Lender to satisfy such Lenders
obligations under such Sections until all such unsatisfied obligations are fully paid.
Administrative Agent may (but shall not be required to), in its discretion, retain any payments
or other funds received by any Agent that are to be provided to a Defaulting Lender hereunder,
and may apply such funds to such Lenders defaulted obligations or readvance the funds to
Borrowers in accordance with this Agreement. The failure of any Lender to fund a Loan, to make
any payment in respect of any LC Obligation or to otherwise perform its obligations hereunder
shall not relieve any other Lender of its obligations, and no Lender shall be responsible for
default by another Lender. Lenders and each Agent agree (which agreement is solely among them,
and not for the benefit of or enforceable by any Borrower) that, solely for purposes of
determining a Defaulting Lenders right to vote on matters relating to the Loan Documents (other
than those matters that would (i) increase or extend the Commitment of such Lender, (ii) reduce
the amount of or extend the time for final payment of principal owing to such Lender, (iii)
modify provisions affecting a Defaulting Lenders voting rights or (iv) treat or affect a
Defaulting Lender more adversely than the other Lenders) and to share in payments, fees and
Collateral proceeds thereunder, a Defaulting Lender shall not be deemed to be a Lender until
all its defaulted obligations have been cured.
SECTION 2.15 Taxes.
(a) Payments Free of Taxes. Any and all payments by or on account of any
obligation of the Loan Parties hereunder or under any other Loan Document shall be made free and
clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes;
provided that if any Loan Party shall be required by Applicable Law to deduct any
Indemnified Taxes or Other Taxes from such payments, then (i) the applicable Loan Party shall
increase the sum payable as necessary so that after all such required deductions and
withholdings (including any such deductions and withholdings applicable to additional sums
payable under this Section) each Agent, Lender or Issuing Bank, as the case may be,
receives an amount equal to the sum it would have received had no such deductions or
withholdings been made, (ii) the applicable Loan Party shall make such deductions or
withholdings and (iii) the applicable Loan Party shall timely pay the full amount deducted or
withheld to the relevant Taxing Authority in accordance with Applicable Law.
The U.K. Borrower is not required to make an increased payment to any Agent, Lender or Issuing
Bank, under this Section for a deduction on account of an Indemnified Tax imposed by
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the United Kingdom with respect to a payment of interest on a Loan, if on the date on which the
payment falls due:
(i) the payment could have been made to that Agent, Lender or Issuing Bank without deduction
if it was a U.K. Qualifying Lender, but on that date that Agent, Lender or Issuing Bank is not or
has ceased to be a U.K. Qualifying Lender other than as a result of any change after the date of
this Agreement in (or in the interpretation, administration, or application of) any law or treaty,
or any published practice or concession of any relevant Taxing Authority; or
(ii) the relevant lender is a U.K. Qualifying Lender solely under part (B) of the definition
of that term and it has not confirmed in writing to the U.K. Borrower that it falls within that
part (this subclause shall not apply where the Lender has not so confirmed and a change after the
date of this Agreement in (or in the interpretation, administration or application of) any law, or
any published practice or concession of any relevant Taxing Authority either: (I) renders such
confirmation unnecessary in determining whether the U.K. Borrower is required to make a withholding
or deduction for, or on account of Tax, or (II) prevents the Lender from giving such confirmation);
or
(iii) a payment is due to a Treaty Lender and the U.K. Borrower is able to demonstrate that
the payment could have been made to the Lender without deduction had the Lender complied with its
obligations under Section 2.15(g).
(b) Payment of Other Taxes by Borrowers. Without limiting the provisions of
paragraph (a) above, each Loan Party shall timely pay any Other Taxes to the relevant Taxing
Authority in accordance with Applicable Law.
(c) Indemnification by Borrowers. Each Loan Party shall indemnify each Agent,
Lender and Issuing Bank, within ten (10) Business Days after demand therefor, for the full
amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes
imposed or asserted on or attributable to amounts payable under this Section) paid by
such Agent, Lender or Issuing Bank, as the case may be, and any penalties, interest and
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 Taxing
Authority. A certificate as to the amount of such payment or liability delivered to
Administrative Borrower by a Lender or an Issuing Bank (with a copy to the Administrative
Agent), or by an Agent on its own behalf or on behalf of a Lender or an Issuing Bank, shall be
conclusive absent manifest error. No Borrower shall be obliged to provide indemnity under this
Section where the Indemnified Tax or Other Tax in question is (i) compensated for by an
increased payment under Sections 2.15(a) or 2.12(g) or (ii) would have been
compensated for by an increased payment under Section 2.15(a) but was not so compensated
solely because of one of the exclusions in that Section.
(d) Evidence of Payments. As soon as practicable after any payment of Indemnified
Taxes or Other Taxes by any Loan Party to a Taxing Authority, the applicable Loan Party shall
deliver to the Administrative Agent the original or a certified copy of a receipt issued by such
Taxing Authority evidencing such payment, a copy of the return
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reporting such payment or other evidence of such payment reasonably satisfactory to the
Administrative Agent.
(e) Status of Lenders. Except with respect to U.K. withholding taxes, any Lender
lending to a non-U.K. Borrower that is entitled to an exemption from or reduction of withholding
tax under the law of the jurisdiction in which the applicable Loan Party 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 Administrative Borrower (with a copy to the Administrative Agent) if reasonably requested by
Administrative Borrower or the Administrative Agent (and from time to time thereafter, as
requested by Administrative Borrower or Administrative Agent), such properly completed and
executed documentation prescribed by Applicable Law or any subsequent replacement or substitute
form that it may lawfully provide as will permit such payments to be made without withholding or
at a reduced rate of withholding; provided, however, that no Lender shall be
required to provide any such documentation or form if, in the relevant Lenders reasonable
judgment, doing so would subject such Lender to any material unreimbursed costs or otherwise be
disadvantageous to it in any material respect. In addition, any Lender, if requested by
Administrative Borrower or the Administrative Agent, shall, to the extent it may lawfully do so,
deliver such other documentation reasonably requested by Administrative Borrower or the
Administrative Agent as will enable the applicable Loan Parties or the Administrative Agent to
determine whether or not such Lender is subject to backup withholding or information reporting
requirements; provided, however, that no Lender shall be required to provide any
such documentation if, in the relevant Lenders reasonable judgment, doing so would subject such
Lender to any material unreimbursed costs or otherwise be disadvantageous to it in any material
respect; and provided, further, that the Administrative Borrower may treat any
Agent, Lender or Issuing Bank as an exempt recipient based on the indicators described in
Treasury Regulations Section 1.6049-4(c) and if it may be so treated, such Agent, Lender or
Issuing Bank shall not be required to provide such documentation, except to the extent such
documentation is required pursuant to the Treasury Regulations promulgated under the Code
Section 1441.
Each Lender which so delivers any document requested by Administrative Borrower or
Administrative Agent in Section 2.15(e) herein further undertakes to deliver to
Administrative Borrower (with a copy to Administrative Agent), upon request of Administrative
Borrower or Administrative Agent, copies of such requested form (or a successor form) on or before
the date that such form expires or becomes obsolete or after the occurrence of any event requiring
a change in the most recent form so delivered by it, and such amendments thereto or extensions or
renewals thereof as may be reasonably requested by Administrative Borrower or Administrative Agent,
in each case, unless an event (including any change in treaty, law or regulation) has occurred
prior to the date on which any such delivery would otherwise be required that renders all such
forms inapplicable or that would prevent such Lender from duly completing and delivering any such
form with respect to it. For avoidance of doubt, Borrowers shall not be required to pay additional
amounts to any Lender or Administrative Agent pursuant to this Section 2.15 to the extent
the obligation to pay such additional amount would not have arisen but for the failure of such
Lender or Administrative Agent to comply with this paragraph.
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Each Lender and Issuing Bank shall promptly notify the Administrative Borrower and the
Administrative Agent of any change in circumstances that would change any claimed Tax exemption or
reduction. Each Lender and Issuing Bank shall indemnify, hold harmless and reimburse (within 10
days after demand therefor) Borrowers and the Administrative Agent for any Taxes, losses, claims,
liabilities, penalties, interest and expenses (including reasonable attorneys fees) incurred by or
asserted against a Borrower or Administrative Agent by any Governmental Authority due to such
Lenders or Issuing Banks failure to deliver, or inaccuracy or deficiency in, any documentation
required to be delivered by it pursuant to this Section. Each Lender and Issuing Bank
authorizes the Administrative Agent to set off any amounts due to the Administrative Agent or the
Borrower under this Section against any amounts payable to such Lender or Issuing Bank
under any Loan Document.
(f) Treatment of Certain Refunds. If an Agent, a Lender or an Issuing Bank
determines, in its sole discretion, that it has received a refund of, credit against, relief or
remission for any Indemnified Taxes or Other Taxes as to which it has been indemnified by the
Loan Parties or with respect to which any Loan Party has paid additional amounts pursuant to
this Section, Section 2.12(g), or Section 2.06(j), it shall pay to such
Loan Party an amount equal to such refund, credit, relief or remission (but only to the extent
of indemnity payments made, or additional amounts paid, by such Loan Party under this
Section with respect to the Indemnified Taxes or Other Taxes giving rise to such refund
or any additional amounts under Section 2.12(g), or Section 2.06(j)), net of all
reasonable and customary out-of-pocket expenses of such Agent, Lender or Issuing Bank, as the
case may be, and without interest (other than any interest paid by the relevant Taxing Authority
with respect to such refund or any additional amounts under Section 2.12(g), or
Section 2.06(j)); provided that each Loan Party, upon the request of such Agent,
such Lender or such Issuing Bank, agrees to repay the amount paid over to such Loan Party (plus
any penalties, interest or other charges imposed by the relevant Taxing Authority) to such
Agent, Lender or Issuing Bank in the event such Agent, Lender or Issuing Bank is required to
repay such refund to such Taxing Authority. Nothing in this Agreement shall be construed to
require any Agent, any Lender or any Issuing Bank to make available its tax returns (or any
other information relating to its taxes that it deems confidential) to any Loan Party or any
other person. Notwithstanding anything to the contrary, in no event will any Agent, Lender or
Issuing Bank be required to pay any amount to any Loan Party the payment of which would place
such Agent, Lender or Issuing Bank in a less favorable net after-tax position than such Agent,
Lender or Issuing Bank would have been in if the additional amounts giving rise to such refund
of any Indemnified Taxes or Other Taxes had never been paid.
(g) Cooperation. Notwithstanding anything to the contrary in Section
2.15(e), with respect to non-U.S. withholding taxes, the relevant Agent, the relevant
Lender(s) (at the written request of the relevant Loan Party) and the relevant Loan Party, shall
cooperate in completing any procedural formalities necessary (including delivering any
documentation prescribed by Applicable Law and making any necessary reasonable approaches to the
relevant Taxing Authorities) for the relevant Loan Party to obtain authorization to make a
payment to which such Agent or such Lender(s) is entitled without any, or a reduced rate of,
deduction or withholding for, or on account of, Taxes; provided, however, that
no Agent nor any Lender shall be required to provide any documentation that it is not legally
entitled to provide, or take any action that, in the relevant Agents or the relevant Lenders
reasonable
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judgment, would subject such Agent or such Lender to any material unreimbursed costs or
otherwise be disadvantageous to it in any material respect; and provided,
however, that nothing in this Section 2.15(g) shall require a Treaty Lender to:
(A) register under the HMRC DT Treaty Passport Scheme; (B) apply the HMRC DT Treaty Passport
Scheme to any Borrowing if it has so registered; or (C) file Treaty forms if it is registered
under the HMRC DT Treaty Passport Scheme and has indicated to the U.K. Borrower that it wishes
the HMRC DT Treaty Passport Scheme to apply to this Agreement.
(h) Treaty Relief Time Limit Obligations. Subject to Section 2.15(g), a
Treaty Lender in respect of an advance to the U.K. Borrower shall within 30 days of becoming a
Lender in respect of that advance, (unless it is unable to do so as a result of any change after
the date of this Agreement in (or in the interpretation, administration, or application of) any
law or treaty, or any published practice or concession of any relevant Taxing Authority), and
except where it is registered under the HMRC DT Treaty Passport Scheme and has indicated to the
U.K. Borrower that it wishes the HMRC DT Treaty Passport Scheme to apply to this Agreement),
file with the appropriate Taxing Authority for certification a duly completed U.K. double
taxation relief application form for the U.K. Borrower to obtain authorization to pay interest
to that Lender in respect of such advance without a deduction for Taxes in respect of Tax
imposed by the United Kingdom on interest and provide the U.K. Borrower with reasonably
satisfactory evidence that such form has been filed. If a Treaty Lender fails to comply with its
obligations under this Section 2.15(h), the U.K. Borrower shall not be required to make
an increased payment to that Lender under Section 2.15(a) until such time as such Lender
has filed such relevant documentation. This Section 2.15(h) shall not apply to a Treaty
Lender if a filing under the SL Scheme has been made in respect of that Treaty Lender in
accordance with Section 2.15(j) and HM Revenue & Customs have confirmed that the SL
Scheme is applicable in respect of that Treaty Lender. The Administrative Agent and/or the
relevant Treaty Lender, as applicable, shall use reasonable efforts to promptly provide to HM
Revenue & Customs any additional information or documentation requested by HM Revenue & Customs
from the Administrative Agent or the relevant Treaty Lender (as the case may be) in connection
with a treaty relief claim under this paragraph; provided, however that neither
the Administrative Agent nor any Treaty Lender shall be required to provide any information or
documentation that it is not legally entitled to provide, or take any action that, in the
Administrative Agents or the relevant Lenders reasonable judgment would subject the
Administrative Agent or such Lender to any material unreimbursed costs or otherwise be
disadvantageous to it in any material respect;
(i) Requirement to Seek Refund in Respect of an Increased Payment. If the U.K.
Borrower makes a tax deduction (a Tax Deduction) in respect of tax imposed by the United
Kingdom on interest from a payment of interest to a Treaty Lender, and Section 2.15(a)
applies to increase the amount of the payment due to that Treaty Lender from the U.K. Borrower,
the U.K. Borrower shall promptly provide the Treaty Lender with an executed original
certificate, in the form required by HM Revenue & Customs, evidencing the Tax Deduction. The
Treaty Lender shall, within a reasonable period following receipt of such certificate, apply to
HM Revenue & Customs for a refund of the amount of the tax deduction and, upon receipt by the
Treaty Lender of such amount from HM Revenue & Customs, Section 2.15(f) shall apply in
relation thereto and for the avoidance of doubt, a refund obtained pursuant to this Section
2.15(i) shall be considered as received by the Treaty Lender
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for the purposes of Section 2.15(f) and no Agent, Lender or Issuing Bank shall have
discretion to determine otherwise; provided, however, that this Section
2.15(i) shall not require a Treaty Lender to apply for a refund of the amount of the Tax
Deduction if the procedural formalities required in relation to making such an application are
materially more onerous or require the disclosure of materially more information than the
procedural formalities required by HM Revenue & Customs as at the date of this Agreement in
relation to such an application.
(j) U.K. Syndicated Loan Scheme.
For the avoidance of doubt, this Section 2.15(j) shall apply only if and to the extent
that the SL Scheme is available to Treaty Lenders.
Each Treaty Lender:
(i) irrevocably appoints the U.K. Borrower to act as syndicate manager under, and authorizes
the U.K. Borrower to operate, and take any action necessary or desirable under, the SL Scheme in
connection with the Loan Documents and Loans;
(ii) shall cooperate with the U.K. Borrower in completing any procedural formalities necessary
under the SL Scheme, and shall promptly supply to the U.K. Borrower such information as the U.K.
Borrower may reasonably request in connection with the operation of the SL Scheme;
(iii) without limiting the liability of any Loan Party under this Agreement, shall, within
five (5) Business Days of demand, indemnify the U.K. Borrower for any liability or loss incurred by
the U.K. Borrower as a result of the U.K. Borrower acting as syndicate manager under the SL Scheme
in connection with the Treaty Lenders participation in any Loan (except to the extent that the
liability or loss arises directly from the U.K. Borrowers gross negligence or willful misconduct);
and
(iv) shall, within five (5) Business Days of demand, indemnify the U.K. Borrower for any tax
which the U.K. Borrower becomes liable to pay in respect of any payments made to such Treaty Lender
arising as a result of any incorrect information supplied by such Treaty Lender under paragraph
(ii) above which results in a provisional authority issued by the HM Revenue & Customs under the SL
Scheme being withdrawn.
The U.K. Borrower acknowledges that it is fully aware of its contingent obligations under the SL
Scheme and shall act in accordance with any provisional notice issued by the HM Revenue & Customs
under the SL Scheme.
All parties acknowledge that the U.K. Borrower (acting as syndicate manager):
(v) is entitled to rely completely upon information provided to it in connection with this
Section 2.15(j);
(vi) is not obliged to undertake any enquiry into the accuracy of such information, nor into
the status of the Treaty Lender providing such information; and
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(vii) shall have no liability to any person for the accuracy of any information it submits in
connection with this Section 2.15(j).
(k) Tax Returns. Except as otherwise provided in Section 2.15(h) or
(j), if, as a result of executing a Loan Document, entering into the transactions
contemplated thereby or with respect thereto, receiving a payment or enforcing its rights
thereunder, an Agent, Lender or Issuing Bank is required to file a Tax Return in a jurisdiction
in which it would not otherwise be required to file, the Loan Parties shall promptly provide
such information necessary for the completion and filing of such Tax Return as the relevant
Agent, Lender or Issuing Bank shall reasonably request with respect to the completion and filing
of such Tax Return. For clarification, any expenses incurred in connection with such filing
shall be subject to Section 11.03.
(l) Value Added Tax. All amounts set out, or expressed to be payable under a Loan
Document by any party to a Lender, Agent or Issuing Bank which (in whole or in part) constitute
the consideration for value added tax purposes shall be deemed to be exclusive of any value
added tax which is chargeable on such supply, and accordingly, if value added tax is chargeable
on any supply made by any Lender, Agent or Issuing Bank to any party under a Loan Document, that
party shall pay to the Lender, Agent or Issuing Bank (in addition to and at the same time as
paying the consideration) an amount equal to the amount of the value added tax (and such Lender,
Agent or Issuing Bank shall promptly provide an appropriate value added invoice to such party).
Where a Loan Document requires any party to reimburse a Lender, Agent or Issuing Bank for any costs
or expenses, that party shall also at the same time pay and indemnify the Lender, Agent or Issuing
Bank against all value added tax incurred by the Lender, Agent or Issuing Bank in respect of the
costs or expenses to the extent that the party reasonably determines that neither it nor any other
member of any group of which it is a member for value added tax purposes is entitled to credit or
repayment from the relevant tax authority in respect of the value added tax.
If any Lender, Agent or Issuing Bank requires any Loan Party to pay any additional amount pursuant
to Section 2.15(l), then such Lender, Agent or Issuing Bank and Loan Party shall use
reasonable efforts to cooperate to minimize the amount such Loan Party is required to pay if, in
the judgment of such Lender, Agent or Issuing Bank, such co-operation would not subject such
Lender, Agent or Issuing Bank to any unreimbursed cost or expense and would not otherwise be
disadvantageous to such Lender, Agent or Issuing Bank.
(m) FATCA. If a payment made by Borrowers hereunder or under any other Loan
Document would be subject to U.S. federal withholding tax imposed pursuant to FATCA if any
Lender fails to comply with applicable reporting and other requirements of FATCA (including
those contained in section 1471(b) or 1472(b) of the Code, as applicable), such Lender shall use
commercially reasonable efforts to deliver to Administrative Borrower and the Administrative
Agent, at the time or times prescribed by applicable law or as reasonably requested by
Administrative Borrower or the Administrative Agent, (A) two accurate, complete and signed
certifications prescribed by applicable law and/or reasonably satisfactory to Administrative
Borrower and the Administrative Agent that establish that such payment is exempt from United
States federal withholding tax imposed pursuant to FATCA and (B) any
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other documentation reasonably requested by Administrative Borrower or the Administrative
Agent sufficient for Administrative Borrower and the Administrative Agent to comply with their
obligations under FATCA and to determine that such Lender has complied with such applicable
reporting and other requirements of FATCA.
SECTION 2.16 Mitigation Obligations; Replacement of Lenders.
(a) Designation of a Different Lending Office. Each Lender may at any time or from
time to time designate, by written notice to the Administrative Agent, one or more lending
offices (which, for this purpose, may include Affiliates of the respective Lender) for the
various Loans made, and Letters of Credit participated in, by such Lender; provided
that, to the extent such designation shall result, as of the time of such designation, in
increased costs under Section 2.12 or Section 2.15 in excess of those which
would be charged in the absence of the designation of a different lending office (including a
different Affiliate of the respective Lender), then the Borrowers shall not be obligated to pay
such excess increased costs (although the Borrowers, in accordance with and pursuant to the
other provisions of this Agreement, shall be obligated to pay the costs which would apply in the
absence of such designation and any subsequent increased costs of the type described above
resulting from changes after the date of the respective designation); and provided,
further, that with respect to any Loan (and so long as no Event of Default shall have
occurred and is continuing), if such Lender is a Swiss Qualifying Bank, such branch or Affiliate
must also qualify as a Swiss Qualifying Bank. Each lending office and Affiliate of any Lender
designated as provided above shall, for all purposes of this Agreement, be treated in the same
manner as the respective Lender (and shall be entitled to all indemnities and similar provisions
in respect of its acting as such hereunder). The first proviso to the first sentence of this
Section 2.16(a) shall not apply to changes in a lending office pursuant to Section
2.16(b) if such change was made upon the written request of the Administrative Borrower.
(b) Mitigation Obligations. If any Lender requests compensation under Section
2.12, or requires any Loan Party to pay any additional amount to any Lender or any Taxing
Authority for the account of any Lender pursuant to Section 2.15, then such Lender shall
use reasonable efforts to designate a different lending office for funding or booking its Loans
hereunder or to assign its rights and obligations hereunder to another of its offices, branches
or affiliates, if, in the judgment of such Lender, such designation or assignment (i) would
eliminate or reduce amounts payable pursuant to Section 2.12 or Section 2.15, as
the case may be, in the future and (ii) would not subject such Lender to any unreimbursed cost
or expense and would not otherwise be disadvantageous to such Lender. Each Loan Party hereby
agrees to pay all reasonable costs and expenses incurred by any Lender in connection with any
such designation or assignment. A certificate setting forth such costs and expenses submitted
by such Lender to Administrative Borrower shall be conclusive absent manifest error.
(c) Replacement of Lenders. If any Lender requests compensation under Section
2.12, or if any Borrower is required to pay any additional amount to any Lender or any
Taxing Authority for the account of any Lender pursuant to Section 2.15, or if any
Lender is a Defaulting Lender, then, in addition to any other rights and remedies that any
Person may have, Administrative Agent may, by notice to such Lender within 120 days after such
event, require such Lender to assign all of its rights and obligations under the Loan Documents
to
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Eligible Assignee(s) specified by Administrative Agent, pursuant to appropriate Assignment
and Assumption(s) and within 20 days after Agents notice. Administrative Agent is irrevocably
appointed as attorney-in-fact to execute any such Assignment and Assumption if the Lender fails
to execute same. Such Lender shall be entitled to receive, in cash, concurrently with such
assignment, all amounts owed to it under the Loan Documents, including all principal, interest
and fees through the date of assignment (but excluding any prepayment charge).
SECTION 2.17 Swingline Loans.
(a) U.S. Swingline Loans. The Administrative Agent, the U.S. Swingline Lender and
the Revolving Lenders agree that in order to facilitate the administration of this Agreement and
the other Loan Documents, promptly after the Administrative Borrower requests a Base Rate
Revolving Loan, the U.S. Swingline Lender may elect to have the terms of this Section
2.17(a) apply to up to $50,000,000 of such Borrowing Request by crediting, on behalf of the
Revolving Lenders and in the amount requested, same day funds to the U.S. Borrowers, in the case
of U.S. Revolving Loans made to them, or the Parent Borrower, in the case of U.S. Revolving
Loans made to it (or, in the case of a U.S. Swingline Loan made to finance the reimbursement of
an LC Disbursement in respect of a U.S. Letter of Credit as provided in Section 2.18, by
remittance to the applicable Issuing Bank), on the applicable Borrowing date as directed by the
Administrative Borrower in the applicable Borrowing Request maintained with the Administrative
Agent (each such Loan made solely by the U.S. Swingline Lender pursuant to this Section
2.17(a) is referred to in this Agreement as a U.S. Swingline Loan), with settlement among
them as to the U.S. Swingline Loans to take place on a periodic basis as set forth in
Section 2.17(c). Each U.S. Swingline Loan shall be subject to all the terms and
conditions applicable to other Base Rate Revolving Loans funded by the Revolving Lenders, except
that all payments thereon shall be payable to the U.S. Swingline Lender solely for its own
account. U.S. Swingline Loans shall be made in minimum amounts of $1,000,000 and integral
multiples of $500,000 above such amount.
(b) U.S. Swingline Loan Participations. Upon the making of a U.S. Swingline Loan
(whether before or after the occurrence of a Default and regardless of whether a Settlement has
been requested with respect to such U.S. Swingline Loan), each Revolving Lender shall be deemed,
without further action by any party hereto, to have unconditionally and irrevocably purchased
from the U.S. Swingline Lender, without recourse or warranty, an undivided interest and
participation in such U.S. Swingline Loan in proportion to its Pro Rata Percentage of the
Revolving Commitment. The U.S. Swingline Lender may, at any time, require the Revolving Lenders
to fund their participations. From and after the date, if any, on which any Revolving Lender is
required to fund its participation in any U.S. Swingline Loan purchased hereunder, the
Administrative Agent shall promptly distribute to such Lender, such Lenders Pro Rata Percentage
of all payments of principal and interest and all proceeds of Collateral received by the
Administrative Agent that are payable to such Lender in respect of such Loan.
(c) U.S. Swingline Loan Settlement. The Administrative Agent, on behalf of the
U.S. Swingline Lender, shall request settlement (a Settlement) with the Revolving Lenders on
at least a weekly basis or on any date that the Administrative Agent elects, by notifying the
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Revolving Lenders of such requested Settlement by facsimile, telephone, or e-mail no later
than 12:00 noon, New York time on the date of such requested Settlement (the Settlement Date).
Each Revolving Lender (other than the U.S. Swingline Lender, in the case of the U.S. Swingline
Loans) shall transfer the amount of such Revolving Lenders Pro Rata Percentage of the
outstanding principal amount of the applicable Loan with respect to which Settlement is
requested to the Administrative Agent, to such account of the Administrative Agent as the
Administrative Agent may designate, not later than 3:00 p.m., New York time, on such Settlement
Date. Settlements may occur during the existence of a Default and whether or not the applicable
conditions precedent set forth in Section 4.02 have then been satisfied. Such amounts
transferred to the Administrative Agent shall be applied against the amounts of the U.S.
Swingline Lenders U.S. Swingline Loans and, together with U.S. Swingline Lenders Pro Rata
Percentage of such U.S. Swingline Loan, shall constitute U.S. Revolving Loans of such Revolving
Lenders. If any such amount is not transferred to the Administrative Agent by any Revolving
Lender on such Settlement Date, each of such Lender and the U.S. Borrowers severally agrees to
repay to the U.S. Swingline Lender forthwith on demand such corresponding amount together with
interest thereon, for each day from the date such amount is made available to such Borrowers
until the date such amount is repaid to the U.S. Swingline Lender at (i) in the case of such
U.S. Borrowers, the interest rate applicable at the time to the Loans comprising such Borrowing
and (ii) in the case of such Lender, the greater of the Interbank Rate and a rate determined by
the Administrative Agent in accordance with banking industry rules on interbank compensation.
If such Lender shall repay to the U.S. Swingline Bank such corresponding amount, such amount
shall constitute such Lenders Loan as part of such Borrowing for purposes of this Agreement,
and the applicable Borrowers obligations to repay the Administrative Agent such corresponding
amount pursuant to this Section 2.17(c) shall cease.
(d) European Swingline Commitment. Subject to the terms and conditions set
forth herein, the European Swingline Lender agrees to make European Swingline Loans to the
European Administrative Borrower from time to time during the Revolving Availability Period, in
an aggregate principal amount at any time outstanding that will not (subject to the provisions
of Section 2.01(e)) result in (i) the aggregate principal amount of outstanding European
Swingline Loans exceeding the European Swingline Commitment, (ii) the Total Adjusted Revolving
Exposure exceeding the Total Adjusted Borrowing Base, or (iii) the Total Revolving Exposure
exceeding the lesser of (A) the Total Revolving Commitment and (B) the Total Borrowing Base then
in effect; provided that the European Swingline Lender shall not be required to make a
European Swingline Loan (i) to refinance an outstanding European Swingline Loan, or if another
European Swingline Loan is then outstanding or (ii) if a European Swingline Loan has been
outstanding within three (3) Business Days prior to the date of such requested European
Swingline Loan. Within the foregoing limits and subject to the terms and conditions set forth
herein, the European Administrative Borrower may borrow, repay and reborrow European Swingline
Loans.
(e) European Swingline Loans. To request a European Swingline Loan, the
European Administrative Borrower shall deliver, by hand delivery or telecopier, a duly completed
and executed Borrowing Request to the Administrative Agent and the European Swingline Lender,
not later than 11:00 a.m., Zurich time, on the day of a proposed European Swingline Loan. Each
such notice shall be irrevocable and shall specify the requested date
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(which shall be a Business Day), currency, Interest Period, and the amount of the requested
European Swingline Loan. Each European Swingline Loan shall be a Eurocurrency Loan with an
Interest Period between two days and seven days and shall be made in Euros, GBP or Swiss francs.
The European Swingline Lender shall make each European Swingline Loan available to the European
Administrative Borrower to an account as directed by the European Administrative Borrower in the
applicable Borrowing Request maintained with the Administrative Agent (or, in the case of a
Swingline Loan made to finance the reimbursement of an LC Disbursement as provided in
Section 2.18, by remittance to the applicable Issuing Bank) by 4:00 p.m., Zurich time,
on the requested date of such European Swingline Loan. The European Administrative Borrower
shall not request a European Swingline Loan if at the time of or immediately after giving effect
to the extension of credit contemplated by such request a Default has occurred and is continuing
or would result therefrom. European Swingline Loans shall be made in minimum amounts of
1,000,000 (for Loans denominated in Euros), GBP1,000,000 (for Loans denominated in GBP), or
CHF1,000,000 (for Loans denominated in Swiss Francs) and integral multiples of 500,000,
GBP500,000 or CHF500,000, respectively, above such amount.
(f) Prepayment. The European Administrative Borrower shall have the right at
any time and from time to time to repay any European Swingline Loan, in whole or in part, upon
giving written notice to the European Swingline Lender and the Administrative Agent before 11:00
a.m., Zurich time, on the proposed date of repayment. All payments in respect of the European
Swingline Loans shall be made to the European Swingline Lender at Agents Account.
(g) Participations. The European Swingline Lender may at any time in its
discretion by written notice given to the Administrative Agent (provided such notice
requirement shall not apply if the European Swingline Lender and the Administrative Agent are
the same entity) not later than 11:00 a.m., Zurich time, on the third succeeding Business Day
following such notice require the Revolving Lenders to acquire participations on such Business
Day in all or a portion of the European Swingline Loans then outstanding; provided that
European Swingline Lender shall not give such notice prior to the occurrence of an Event of
Default; provided further, that if (x) such Event of Default is cured or waived
in writing in accordance with the terms hereof, (y) no Obligations have yet been declared due
and payable under Article 8 (or a rescission has occurred under Section 8.02)
and (z) the European Swingline Lender has actual knowledge of such cure or waiver, all prior to
the European Swingline Lenders giving (or being deemed to give) such notice, then the European
Swingline Lender shall not give any such notice based upon such cured or waived Event of
Default. Such notice shall specify the aggregate amount of European Swingline Loans in which
Revolving Lenders will participate. Promptly upon receipt of such notice, the Administrative
Agent will give notice thereof to each Revolving Lender, specifying in such notice such Lenders
Pro Rata Percentage of such European Swingline Loan or Loans. Each Revolving Lender hereby
absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the
Administrative Agent, for the account of the European Swingline Lender, such Lenders Pro Rata
Percentage of such European Swingline Loan or Loans. Each Revolving Lender acknowledges and
agrees that its obligation to acquire participations in European Swingline Loans pursuant to
this paragraph is absolute and unconditional and shall not be affected by any circumstance
whatsoever, including the
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occurrence and continuance of a Default or reduction or termination of the Commitments, and
that each such payment shall be made without any offset, abatement, withholding or reduction
whatsoever (so long as such payment shall not cause such Lenders Pro Rata Percentage of the
Total Revolving Exposure to exceed such Lenders Revolving Commitment). Each Revolving Lender
shall comply with its obligation under this paragraph by wire transfer of immediately available
funds, in the same manner as provided in Section 2.02(c) with respect to Loans made by
such Lender (and Section 2.02 shall apply, mutatis mutandis, to the payment obligations
of the Revolving Lenders), and the Administrative Agent shall promptly pay to the European
Swingline Lender the amounts so received by it from the Revolving Lenders. The Administrative
Agent shall notify the European Administrative Borrower of any participations in any European
Swingline Loan acquired by the Revolving Lenders pursuant to this paragraph, and thereafter
payments in respect of such European Swingline Loan shall be made to the Administrative Agent
and not to the European Swingline Lender. Any amounts received by the European Swingline Lender
from the European Administrative Borrower (or other party on behalf of the European
Administrative Borrower) in respect of a European Swingline Loan after receipt by the European
Swingline Lender of the proceeds of a sale of participations therein shall be promptly remitted
to the Administrative Agent. Any such amounts received by the Administrative Agent shall be
promptly remitted by the Administrative Agent to the Revolving Lenders that shall have made
their payments pursuant to this paragraph, as their interests may appear. The purchase of
participations in a European Swingline Loan pursuant to this paragraph shall not relieve the
European Administrative Borrower of any default in the payment thereof.
(h) Notwithstanding any provisions of this Agreement to the contrary, no Person shall
be or become European Swingline Lender hereunder unless such Person is a Swiss Qualifying Bank.
SECTION 2.18 Letters of Credit.
(a) (i) The Initial Issuing Bank shall (and other Issuing Banks may, in accordance
with the terms and conditions set forth in this Section 2.18) issue Letters of Credit
from time to time at the request of the Administrative Borrower (or, as provided below with
respect to Canadian Dollar Denominated Letters of Credit, Parent Borrower) (each, a U.S. Letter
of Credit) denominated in any Approved Currency (Canadian Dollars in the case of a Canadian
Dollar Denominated Letters of Credit) for the account of a Loan Party (with respect to Canadian
Dollar Denominated Letters of Credit, a Canadian Loan Party) until 30 days prior to the Maturity
Date applicable to Revolving Loans (provided that Administrative Borrower (or, with
respect to Canadian Dollar Denominated Letters of Credit, Parent Borrower) shall be a
co-applicant, and be jointly and severally liable, with respect to each U.S. Letter of Credit
issued for the account of another Loan Party; and provided, further that U.S.
Letters of Credit denominated in Canadian Dollars may be issued an Issuing Bank (in accordance
with the terms and conditions set forth in this Section 2.18) for the account of a
Canadian Loan Party (with Parent Borrower as applicant or co-applicant) (each, a Canadian
Dollar Denominated Letter of Credit)) and (ii) the Initial Issuing Bank shall (and other
Issuing Banks may, in accordance with the terms and conditions set forth in this Section
2.18) issue Letters of Credit from time to time at the request of the European
Administrative Borrower (each, a European Letter of Credit) denominated in any Approved
Currency for the account of a
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Loan Party until 30 days prior to the Maturity Date applicable to Revolving Loans
(provided that the European Administrative Borrower shall be a co-applicant, and be
jointly and severally liable, with respect to each European Letter of Credit issued for the
account of another Loan Party), in each case on the terms set forth herein, including the
following:
(i) Each Borrower acknowledges that each Issuing Banks issuance of any Letter of Credit
is conditioned upon such Issuing Banks receipt of an LC Application with respect to the requested
Letter of Credit, as well as such other instruments and agreements as such Issuing Bank may
customarily require for issuance of a letter of credit of similar type and amount. No Issuing Bank
shall have any obligation to issue any Letter of Credit unless (i) such Issuing Bank receives an LC
Request and LC Application at least two Business Days prior to the requested date of issuance (or
such shorter period as may be acceptable to the such Issuing Bank); (ii) each LC Condition is
satisfied; and (iii) if a Defaulting Lender exists, such Lender or Borrowers have entered into
arrangements satisfactory to Administrative Agent and each applicable Issuing Bank to eliminate any
funding risk associated with the Defaulting Lender. If an Issuing Bank receives written notice
from a Lender at least five Business Days before issuance of a Letter of Credit that any LC
Condition has not been satisfied, such Issuing Bank shall have no obligation to issue the requested
Letter of Credit (or any other) until such notice is withdrawn in writing by that Lender or until
Required Lenders have waived such condition in accordance with this Agreement. Prior to receipt of
any such notice, no Issuing Bank shall be deemed to have knowledge of any failure of LC Conditions.
(ii) Letters of Credit may be requested by Administrative Borrower, European
Administrative Borrower or Parent Borrower only (i) to support obligations of such Borrower or
another Loan Party (which shall be a Canadian Loan Party in the case of Canadian Dollar Denominated
Letters of Credit). The renewal or extension of any Letter of Credit shall be treated as the
issuance of a new Letter of Credit, except that delivery of a new LC Application shall be required
at the discretion of the applicable Issuing Bank.
(iii) The Loan Parties assume all risks of the acts, omissions or misuses of any Letter of
Credit by the beneficiary. In connection with issuance of any Letter of Credit, none of
Administrative Agent, any other Agent, Issuing Bank or any Lender shall be responsible for the
existence, character, quality, quantity, condition, packing, value or delivery of any goods
purported to be represented by any LC Documents; any differences or variation in the character,
quality, quantity, condition, packing, value or delivery of any goods from that expressed in any LC
Documents; the form, validity, sufficiency, accuracy, genuineness or legal effect of any LC
Documents or of any endorsements thereon; the time, place, manner or order in which shipment of
goods is made; partial or incomplete shipment of, or failure to ship, any goods referred to in a
Letter of Credit or LC Documents; any deviation from instructions, delay, default or fraud by any
shipper or other Person in connection with any goods, shipment or delivery; any breach of contract
between a shipper or vendor and a Loan Party; errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telegraph, telex, telecopy, e-mail,
telephone or otherwise; errors in interpretation of technical terms; the misapplication by a
beneficiary of any Letter of Credit or the proceeds thereof; or any consequences arising from
causes beyond the control of any Issuing Bank, any Agent or any Lender, including any act or
omission of a Governmental Authority. The rights and remedies of each Issuing Bank under the Loan
Documents and the LC Documents shall be cumulative. Each Issuing Bank shall be fully
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subrogated to the rights and remedies of each beneficiary whose claims against Borrowers are
discharged with proceeds of any Letter of Credit.
(iv) In connection with its administration of and enforcement of rights or remedies under
any Letters of Credit or LC Documents, each Issuing Bank shall be entitled to act, and shall be
fully protected in acting, upon any certification, documentation or communication in whatever form
believed by such Issuing Bank, in good faith, to be genuine and correct and to have been signed,
sent or made by a proper Person. Each Issuing Bank may consult with and employ legal counsel,
accountants and other experts to advise it concerning its obligations, rights and remedies, and
shall be entitled to act upon, and shall be fully protected in any action taken in good faith
reliance upon, any advice given by such experts. Each Issuing Bank may employ agents and
attorneys-in-fact in connection with any matter relating to Letters of Credit or LC Documents, and
shall not be liable for the negligence or misconduct of agents and attorneys-in-fact selected with
reasonable care.
(v) If Borrower so requests in any applicable Letter of Credit application, the applicable
Issuing Bank may, in its discretion, agree to issue a Letter of Credit that has automatic extension
provisions (each, an Auto-Extension Letter of Credit), provided that any such
Auto-Extension Letter of Credit must permit such Issuing Bank to prevent any such extension at
least once in each twelve-month period (commencing with the date of issuance of such Letter of
Credit) by giving prior notice to the beneficiary thereof not later than a day (the Non-Extension
Notice Date) in each such twelve-month period to be agreed upon at the time such Letter of Credit
is issued. Unless otherwise directed by such Issuing Bank, the applicable Borrower shall not be
required to make a specific request to such Issuing Bank for any such extension. Once an
Auto-Extension Letter of Credit has been issued, the Lenders shall be deemed to have authorized
(but may not require) such Issuing Bank to permit the extension of such Letter of Credit at any
time to an expiry date at least 20 Business Days prior to the Maturity Date; provided,
however, that such Issuing Bank shall not permit any such extension if (A) such Issuing
Bank has determined that it would not be permitted, or would have no obligation at such time to
issue such Letter of Credit in its revised form (as extended) under the terms hereof, or (B) it has
received notice (which may be by telephone or in writing) on or before the day that is seven
Business Days before the Non-Extension Notice Date (1) from Administrative Agent that the Required
Lenders have elected not to permit such extension or (2) from Administrative Agent, any Lender or
any Loan Party that one or more of the applicable conditions specified in Section 4.02 is
not then satisfied, and in each such case directing such Issuing Bank not to permit such extension.
(b) Reimbursement; Participations.
(i) If an Issuing Bank honors any request for payment under a Letter of Credit, the
Applicable LC Applicant shall pay to such Issuing Bank, (A) if the Administrative Agent provides
notice of such payment to the Administrative Borrower before 11:00 a.m., New York time, on the same
day, and (B) if the Administrative Agent provides such notice after such time, on the next Business
Day (such applicable date, the Reimbursement Date), the amount paid by such Issuing Bank under
such Letter of Credit, together with interest at the interest rate for Base Rate Revolving Loans
from the Reimbursement Date until payment by Borrowers; provided that, in the case of any
payment on a Canadian Dollar Denominated Letter of Credit, such payment shall be the Dollar
Equivalent of the amount paid by such Issuing Bank under such
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Letter of Credit, together with interest in Dollars at the interest rate for Base Rate
Revolving Loans from the Reimbursement Date until payment by Borrowers. The obligation of
Borrowers to reimburse the applicable Issuing Bank for any payment made under a Letter of Credit
shall be absolute, unconditional, irrevocable, and joint and several, and shall be paid without
regard to any lack of validity or enforceability of any Letter of Credit or the existence of any
claim, setoff, defense or other right that Borrowers may have at any time against the beneficiary.
Whether or not the Applicable Administrative Borrower submits a Notice of Borrowing, the Applicable
Administrative Borrower shall be deemed to have requested Base Rate Revolving Loans in Dollars in
the Dollar Equivalent amount of such LC Disbursement, or with respect to LC Disbursements in euros
or GBP, European Swingline Loans in an equivalent amount of such currency, in an amount necessary
to pay all amounts due to an Issuing Bank on any Reimbursement Date and each Lender agrees to fund
its Pro Rata share of such Borrowing whether or not the Commitments have terminated, an Overadvance
exists or is created thereby, or the conditions in Section 4 are satisfied.
(ii) Upon issuance of a Letter of Credit, each Lender shall be deemed to have irrevocably
and unconditionally purchased from the applicable Issuing Bank, without recourse or warranty, an
undivided Pro Rata interest and participation in all LC Obligations relating to the Letter of
Credit; provided that, in the case of LC Obligations in respect of any Canadian Dollar
Denominated Letter of Credit, such undivided Pro Rata interest and participation shall be in the
Dollar Equivalent thereof. If an Issuing Bank makes any payment under a Letter of Credit and
Borrowers do not reimburse such payment on the Reimbursement Date, Administrative Agent shall
promptly notify Lenders and each Lender shall promptly (within one Business Day) and
unconditionally pay to Administrative Agent, for the benefit of the applicable Issuing Bank, the
Lenders Pro Rata share of such payment; provided that, in the case of any payment by
Lenders with respect to a Canadian Dollar Denominated Letter of Credit, such payment shall be the
Dollar Equivalent of such unreimbursed payment. Upon request by a Lender, each Issuing Bank shall
furnish copies of any Letters of Credit and LC Documents in its possession at such time.
(iii) The obligation of each Lender to make payments to Administrative Agent for the
account of an Issuing Bank in connection with such Issuing Banks payment under a Letter of Credit
shall be absolute, unconditional and irrevocable, not subject to any counterclaim, setoff,
qualification or exception whatsoever, and shall be made in accordance with this Agreement under
all circumstances, irrespective of any lack of validity or unenforceability of any Loan Documents;
any draft, certificate or other document presented under a Letter of Credit having been determined
to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being
untrue or inaccurate in any respect; or the existence of any setoff or defense that any Loan Party
may have with respect to any Obligations. No Issuing Bank assumes any responsibility for any
failure or delay in performance or any breach by any Borrower or other Person of any obligations
under any LC Documents. No Issuing Bank makes to Lenders any express or implied warranty,
representation or guaranty with respect to the Collateral, LC Documents or any Loan Party. No
Issuing Bank shall be responsible to any Lender for any recitals, statements, information,
representations or warranties contained in, or for the execution, validity, genuineness,
effectiveness or enforceability of any LC Documents; the validity, genuineness, enforceability,
collectibility, value or sufficiency of any Collateral or the perfection of any Lien therein; or
the assets, liabilities, financial condition, results of operations, business, creditworthiness or
legal status of any Loan Party.
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(iv) No Issuing Bank Indemnitee shall be liable to any Lender or other Person for any
action taken or omitted to be taken in connection with any LC Documents except as a result of its
actual gross negligence or willful misconduct. No Issuing Bank shall have any liability to any
Lender if such Issuing Bank refrains from any action under any Letter of Credit or LC Documents
until it receives written instructions from Required Lenders.
(c) Cash Collateral. If any LC Obligations, whether or not then due or
payable, shall for any reason be outstanding at any time (a) that an Event of Default exists,
(b) that Excess Availability is less than zero, or (c) within 20 Business Days prior to the
Maturity Date, then Borrowers shall, at Issuing Banks or Administrative Agents request, cash
collateralize all outstanding Letters of Credit in an amount equal to 105% of all LC Exposure.
Borrowers shall, on demand by at Issuing Banks or Administrative Agent from time to time, cash
collateralize 105% of the LC Exposure of any Defaulting Lender. If Borrowers fail to provide
any cash collateral as required hereunder, Lenders may (and shall upon direction of
Administrative Agent) advance, as Loans, the amount of the cash collateral required (whether or
not the Commitments have terminated, an Overadvance exists or the conditions in Section
4 are satisfied).
(d) Resignation of Initial Issuing Bank. Initial Issuing Bank may resign at
any time upon notice to Administrative Agent and Administrative Borrower. On the effective date
of such resignation, Initial Issuing Bank shall have no further obligation to issue, amend,
renew, extend or otherwise modify any Letter of Credit, but shall continue to have the benefits
of Sections 2.18, 10.05 and 11.03 with respect to any Letters of Credit
issued or other actions taken while Issuing Bank. Administrative Agent shall promptly appoint a
replacement Initial Issuing Bank and, as long as no Default or Event of Default exists, such
replacement shall be reasonably acceptable to Administrative Borrower.
(e) Additional Issuing Banks. The Applicable Administrative Borrower may, at
any time and from time to time, designate one or more additional Lenders to act as an Issuing
Bank with respect to Letters of Credit under the terms of this Agreement, in each case with the
consent of the Administrative Agent (which consent shall not be unreasonably withheld) and such
Lender(s). Any Lender designated as an Issuing Bank pursuant to this paragraph (e) shall be
deemed (in addition to being a Lender) to be the Issuing Bank with respect to Letters of Credit
issued or to be issued by such Lender, and all references herein and in the other Loan Documents
to the term Issuing Bank shall, with respect to such Letters of Credit, be deemed to refer to
such Lender in its capacity as Issuing Bank, as the context shall require. Notwithstanding any
provisions of this Agreement to the contrary, no Person shall be or become an Issuing Bank
hereunder unless such Person is a Swiss Qualifying Bank.
(f) Existing Letters of Credit. On the Closing Date, (i) each Existing Letter
of Credit, to the extent outstanding, shall be automatically and without further action by the
parties thereto deemed converted into Letters of Credit issued pursuant to this Section
2.18 for the account of the Loan Parties set forth on Schedule 2.18(a) and subject
to the provisions hereof, and for this purpose fees in respect thereof pursuant to Section
2.05(c) shall be payable (in substitution for any fees set forth in the applicable letter of
credit reimbursement agreements or applications relating to such Existing Letters of Credit,
except to the extent that such fees are also payable pursuant to Section 2.05(c)) as if
such Existing Letters of Credit
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had been issued on the Closing Date, (ii) the Lenders set forth on Schedule
2.18(a), or their designated Affiliates who are eligible to be Issuing Banks, shall be
deemed to be the Issuing Bank with respect to each such Existing Letter of Credit, (iii) such
Letters of Credit shall each be included in the calculation of LC Exposure and U.S. LC Exposure
or European LC Exposure, as applicable, and (iv) all liabilities of the Loan Parties with
respect to such Existing Letters of Credit shall constitute Obligations. Notwithstanding the
foregoing, the Loan Parties shall not be required to pay any additional issuance fees with
respect to the issuance of such Existing Letter of Credit solely as a result of such letter of
credit being converted to a Letter of Credit hereunder, it being understood that the fronting,
participation and other fees set forth in Section 2.05(c) shall otherwise apply to such
Existing Letters of Credit. No Existing Letter of Credit converted in accordance with this
clause (f) shall be amended, extended or renewed except in accordance with the terms hereof.
(g) Existing Commerzbank Letters of Credit. On the Closing Date, (i) each
Existing Commerzbank Letter of Credit, to the extent outstanding, shall be automatically and
without further action by the parties thereto deemed converted into Letters of Credit issued
pursuant to this Section 2.18 for the account of the Loan Parties set forth on
Schedule 2.18(b) and subject to the provisions hereof, and for this purpose fees in
respect thereof pursuant to Section 2.05(c) shall be payable (in substitution for any
fees set forth in the applicable letter of credit reimbursement agreements or applications
relating to such Existing Commerzbank Letters of Credit, except to the extent that such fees are
also payable pursuant to Section 2.05(c)) as if such Existing Commerzbank Letters of
Credit had been issued on the Closing Date, (ii) the designated Affiliates of Commerzbank listed
on Schedule 2.18(b) shall be deemed to be the Issuing Bank with respect to their
respective Existing Commerzbank Letters of Credit, (iii) such Letters of Credit shall each be
included in the calculation of LC Exposure, and either U.S. LC Exposure or European LC Exposure,
as applicable, and (iv) all liabilities of the Loan Parties with respect to such Existing
Commerzbank Letters of Credit shall constitute Obligations. Notwithstanding the foregoing, the
Loan Parties shall not be required to pay any additional issuance fees with respect to the
issuance of such Existing Commerzbank Letter of Credit solely as a result of such letter of
credit being converted to a Letter of Credit hereunder, it being understood that the fronting,
participation and other fees set forth in Section 2.05(c) shall otherwise apply to such
Existing Commerzbank Letters of Credit. No Existing Commerzbank Letter of Credit converted in
accordance with this clause (g) shall be amended, extended or renewed. In the event that
Commerzbank or any of its Affiliates becomes a Lender hereunder, the Existing Commerzbank
Letters of Credit shall be deemed to be converted on such day to Existing Letters of Credit
pursuant to Section 2.18(f). Upon (i) the expiration of all Existing Commerzbank Letter
of Credit, (ii) cash collateralization thereof (or delivery of a standby letter of credit
reasonably acceptable to Commerzbank, in the amount of required cash collateral) in an amount
equal to 105% of all LC Exposure in respect thereof or (iii) the full and indefeasible cash
payment of all Obligations in respect thereof (including all reimbursement obligations,
interest, fees and other amounts payable, other than indemnity obligations with respect to which
no claim has been asserted), Commerzbank shall be discharged from its duties and obligations
hereunder in its capacity as Issuing Bank (other than with respect to provisions stated pursuant
to Section 11.05 to survive termination of this Agreement), but shall continue to have
the benefits of the exculpatory provisions of this Section 2.18 and the indemnification
set forth in Sections 10.05
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and 11.03 with respect to matters originating during the time period from the
Closing Date through such discharge.
(h) Other. Notwithstanding any provisions of this Agreement to the contrary,
no Person shall be or become an Issuing Bank hereunder unless such Person is a Swiss Qualifying
Bank. No Issuing Bank shall be under any obligation to issue any Letter of Credit if:
(i) any order, judgment or decree of any Governmental Authority or arbitrator shall by its
terms purport to enjoin or restrain such Issuing Bank from issuing such Letter of Credit, or any
requirement of Applicable Law applicable to such Issuing Bank or any request or directive (whether
or not having the force of law) from any Governmental Authority with jurisdiction over such Issuing
Bank shall prohibit, or request that such Issuing Bank refrain from, the issuance of letters of
credit generally or such Letter of Credit in particular or shall impose upon such Issuing Bank with
respect to such Letter of Credit any restriction, reserve or capital requirement (for which such
Issuing Bank is not otherwise compensated hereunder) not in effect on the Closing Date, or shall
impose upon such Issuing Bank any unreimbursed loss, cost or expense which was not applicable on
the Closing Date and which such Issuing Bank in good faith deems material to it;
(ii) the issuance of such Letter of Credit would violate one or more policies of such
Issuing Bank; or
(iii) where the Letter of Credit is a Standby Letter of Credit, if the beneficiary of such
Letter of Credit is resident in Ireland or, where the beneficiary is a legal person, its place of
establishment to which the Letter of Credit relates is in Ireland, unless such Issuing Bank is duly
authorized to carry on the business of issuing contracts of suretyship in Ireland (or is otherwise
exempted under the laws of Ireland from the requirement to have any such authorization).
SECTION 2.19 Interest Act (Canada); Criminal Rate of Interest; Nominal Rate of
Interest.
(a) Notwithstanding anything to the contrary contained in this Agreement or in any
other Loan Document, solely to the extent that a court of competent jurisdiction finally
determines that the calculation or determination of interest or any fee payable by any Canadian
Loan Party in respect of the Obligations pursuant to this Agreement and the other Loan Documents
shall be governed by the laws of any province of Canada or the federal laws of Canada, in no
event shall the aggregate interest (as defined in Section 347 of the Criminal Code, R.S.C. 1985,
c. C-46, as the same shall be amended, replaced or re-enacted from time to time, Section 347))
payable by the Canadian Loan Parties to the Agents or any Lender under this Agreement or any
other Loan Document exceed the effective annual rate of interest on the Credit advances (as
defined in Section 347) under this Agreement or such other Loan Document lawfully permitted
under Section 347 and, if any payment, collection or demand pursuant to this Agreement or any
other Loan Document in respect of Interest (as defined in Section 347) is determined to be
contrary to the provisions of Section 347, such payment, collection or demand shall be deemed to
have been made by mutual mistake of the Agents,
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the Lenders and the Canadian Loan Parties and the amount of such payment or collection
shall be refunded by the relevant Agents and Lenders to the applicable Canadian Loan Parties.
For the purposes of this Agreement and each other Loan Document to which the Canadian Loan
Parties are a party, the effective annual rate of interest payable by the Canadian Loan Parties
shall be determined in accordance with generally accepted actuarial practices and principles
over the term of the loans on the basis of annual compounding for the lawfully permitted rate of
interest and, in the event of dispute, a certificate of a Fellow of the Canadian Institute of
Actuaries appointed by the Administrative Agent for the account of the Canadian Loan Parties
will be conclusive for the purpose of such determination in the absence of evidence to the
contrary.
(b) For the purposes of the Interest Act (Canada) and with respect to Canadian Loan
Parties only:
(i) whenever any interest or fee payable by the Canadian Loan Parties 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 such rate is to be ascertained and (z) divided by 360 or 365, as the
case may be; and
(ii) all calculations of interest payable by the Canadian Loan Parties under this
Agreement or any other Loan Document are to be made on the basis of the nominal interest rate
described herein and therein and not on the basis of effective yearly rates or on any other basis
which gives effect to the principle of deemed reinvestment of interest.
The parties hereto acknowledge that there is a material difference between the stated nominal
interest rates and the effective yearly rates of interest and that they are capable of making the
calculations required to determine such effective yearly rates of interest.
SECTION 2.20 [intentionally omitted].
SECTION 2.21 Representation to Swiss Borrower.
(a) Each Lender on the Closing Date represents that it is a Swiss Qualifying Bank or a
Swiss Non-Qualifying Bank as further indicated on Schedule 2.21. Each Lender represents
to Swiss Borrower on the date on which it becomes a party to this Agreement in its capacity as
such whether it is a Swiss Qualifying Bank or a Swiss Non-Qualifying Bank, as indicated on the
applicable Assignment and Assumption.
(b) Each Lender shall, if requested to do so by Swiss Borrower, within ten (10)
Business Days of receiving such request confirm, as at the date on which it gives such
confirmation whether it is a Swiss Qualifying Bank or a Swiss Non-Qualifying Bank (or, if it
requires a confirmation by the Swiss Federal Tax Administration in order to be able to give such
confirmation, a request for such a confirmation shall be filed by the relevant Lender with the
Swiss Federal Tax Administration within ten (10) Business Days of it receiving such request and,
upon receipt of the required confirmation from the Swiss Federal Tax
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Administration, the necessary confirmation by the relevant Lender shall be made within ten
(10) Business Days of such confirmation being received by it).
(c) Any Lender that ceases to be a Swiss Qualifying Bank shall provide written notice
to Administrative Borrower and Administrative Agent at least twenty (20) Business Days prior to
the time that it ceases to be a Swiss Qualifying Bank. If as a result of such event the number
of Swiss Non-Qualifying Banks under this Agreement exceeds the number ten, then, so long as no
Significant Event of Default is in existence, Administrative Borrower shall have the right to
request that the relevant Lender assign or transfer by novation all of its rights and
obligations under this Agreement to an Eligible Assignee qualifying as a Swiss Qualifying Bank
or another Lender qualifying as a Swiss Qualifying Bank, all in accordance with Section
11.04. The Administrative Agent shall have no responsibility for determining whether or not
an entity is a Swiss Qualified Bank, but shall track the number of Lenders from time to time
that were unable to represent that they were Swiss Qualifying Banks in order to determine
whether the number of Swiss Non-Qualifying Banks under this Agreement exceeds the number ten;
provided that the Administrative Agent shall have no liability for any determinations
made hereunder unless such liability arises from its gross negligence or willful misconduct (as
determined by a court of competent jurisdiction in a non-appealable decision).
(d) This Section 2.21, Section 2.06(j), Section 5.15 and
Section 11.04(f) shall apply accordingly to any Borrower (other than Swiss Borrower),
which is incorporated or established under the laws of, or for tax purposes resident in,
Switzerland, or for tax purposes having a permanent establishment in Switzerland with which a
Loan is effectively connected.
SECTION 2.22 Blocked Loan Parties. If a Loan Party would have been required to make any payment or
perform any action under any provision of the Loan Documents but the relevant provision(s) (or any
portion thereof) is (are) not enforceable against that Loan Party or for any other reason that Loan
Party is unable to fulfill its obligations under the Loan Documents (a Blocked Loan Party), the
Administrative Borrower may designate which Loan Party shall fulfill the Blocked Loan Partys
obligations, but only so long as the designated Loan Party is duly and promptly fulfilling such
obligations, failing which all Loan Parties shall be jointly and severally liable for the
performance thereof.
SECTION 2.23 Increase in Commitments.
(a) Borrowers Request. The Borrowers may by written notice to the
Administrative Agent and each Lender elect to request prior to the Maturity Date, one or more
increases to the existing Revolving Commitments by an amount not in excess of $200,000,000 in
the aggregate, each in a minimum amount of $25,000,000 (and increments of $1,000,000 above that
minimum) (each such increase, an Incremental Revolving Commitment). Such notice shall specify
the date on which the Borrowers propose that the Incremental Revolving Commitments shall be
effective (each, an Increase Effective Date), and the time period within which each Lender is
requested to respond, which in each case shall be a date not less than ten (10) Business Days
after the date on which such notice is delivered to the Administrative Agent and the Lenders of
the applicable Class. Each Lender of such Class (other than Lenders subject to replacement
pursuant to Section 2.16 or a Defaulting Lender) in its sole and absolute discretion may
notify the Administrative Agent
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within such time period whether or not it agrees to increase its Commitment and, if so,
whether by an amount equal to, greater than, or less than its Pro Rata Percentage of such
requested increase. Any Lender not responding within such time period shall be deemed to have
declined to increase its Commitment. The Administrative Agent shall notify the Administrative
Borrower and each Lender of such Class of the Lenders responses to each request made hereunder.
If the existing Lenders do not agree to the full amount of a requested Incremental Revolving
Commitment, the Administrative Borrower may then invite a Lender or any Lenders to increase
their Commitments or invite additional financial institutions (each, an Additional Lender)
(reasonably satisfactory to Administrative Agent and solely to the extent permitted by
Section 11.04 (including Section 11.04(h)) and each other applicable requirement
hereof, including Sections 2.21 and 5.15) to become Lenders and provide
Incremental Revolving Commitments pursuant to an Increase Joinder.
(b) Conditions. The increased or new Commitments shall become effective, as of
such Increase Effective Date; provided that:
(i) each of the conditions set forth in Section 4.02 shall be satisfied;
(ii) no Default shall have occurred and be continuing or would result from the borrowings
to be made on the Increase Effective Date;
(iii) after giving pro forma effect to the borrowings to be made on the Increase Effective
Date and to any change in Consolidated EBITDA and any increase in Indebtedness resulting from the
consummation of any Permitted Acquisition or other Investment or application of funds made with the
proceeds of such borrowings, the Borrowers shall, as of such date, be in compliance with the
covenant set forth in Section 6.10, to the extent applicable;
(iv) the Borrowers shall make any payments required pursuant to Section 2.12 in
connection with any adjustment of Revolving Loans pursuant to Section 2.23(d); and
(v) the Borrowers shall deliver or cause to be delivered any legal opinions or other
documents reasonably requested by the Administrative Agent in connection with any such transaction.
(c) Terms of New Loans and Commitments. The terms and provisions of Loans made
pursuant to Incremental Revolving Commitments shall be identical to the Revolving Loans of the
same Class (subject to the payment of any customary arrangement, underwriting or similar fees
that are paid to the arranger of such Incremental Revolving Commitments in its capacity as
such). The increased or new Commitments shall be effected by a joinder agreement (the Increase
Joinder) executed by the Loan Parties, the Administrative Agent and each Lender and Additional
Lender making such Incremental Revolving Commitment, in form and substance satisfactory to each
of them. The Increase Joinder may, without the consent of any other Lenders, effect such
amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in
the opinion of the Administrative Agent, to effect the provisions of this Section 2.23.
In addition, unless otherwise specifically provided herein, all references in Loan Documents to
Revolving Loans shall be deemed, unless the context otherwise requires, to include references to
Revolving Loans made pursuant to
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Incremental Revolving Commitments made pursuant to this Agreement, and all references in
Loan Documents to Commitments of a Class shall be deemed, unless the context otherwise requires,
to include references to Incremental Revolving Commitments of such Class made pursuant to this
Agreement.
(d) Adjustment of Revolving Loans. Each of the Revolving Lenders having a
Revolving Commitment of an applicable Class prior to such Increase Effective Date (the
Pre-Increase Revolving Lenders) shall assign to any Revolving Lender which is acquiring a new
or additional Revolving Commitment of such Class on the Increase Effective Date (the
Post-Increase Revolving Lenders), and such Post-Increase Revolving Lenders shall purchase from
each Pre-Increase Revolving Lender, at the principal amount thereof, such interests in the
Revolving Loans of such Class and participation interests in LC Exposure and Swingline Loans of
such Class outstanding on such Increase Effective Date as shall be necessary in order that,
after giving effect to all such assignments and purchases, such Revolving Loans and
participation interests in LC Exposure and Swingline Loans will be held by Pre-Increase
Revolving Lenders and Post-Increase Revolving Lenders of such Class ratably in accordance with
their Revolving Commitments of such Class after giving effect to such increased Revolving
Commitments.
(e) Equal and Ratable Benefit. The Loans and Commitments established pursuant
to this Section 2.23 shall constitute Loans and Commitments under, and shall be entitled
to all the benefits afforded by, this Agreement and the other Loan Documents, and shall, without
limiting the foregoing, benefit equally and ratably from the Guarantees and security interests
created by the Security Documents. The Loan Parties shall take any actions reasonably required
by the Administrative Agent to ensure and/or demonstrate that the Lien and security interests
granted by the Security Documents continue to be perfected under the UCC, the PPSA or otherwise
after giving effect to the establishment of any such new Commitments.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
Each Loan Party represents and warrants to the Administrative Agent, the Collateral Agent,
each Issuing Bank and each of the Lenders that:
SECTION 3.01 Organization; Powers. Each Company (a) is duly organized or incorporated (as applicable)
and validly existing under the laws of the jurisdiction of its organization or incorporation (as
applicable), (b) has all requisite organizational or constitutional power and authority to carry on
its business as now conducted and to own and lease its property and (c) is qualified and in good
standing (to the extent such concept is applicable in the applicable jurisdiction) to do business
in every jurisdiction where such qualification is required, except in such jurisdictions where the
failure to so qualify or be in good standing, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 3.02 Authorization; Enforceability. The Transactions to be entered into by each Loan Party are
within such Loan Partys organizational or constitutional powers and have
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been duly authorized by all necessary constitutional or organizational action on the part of such
Loan Party. This Agreement has been duly executed and delivered by each Loan Party and
constitutes, and each other Loan Document to which any Loan Party is to be a party, when executed
and delivered by such Loan Party, will constitute, a legal, valid and binding obligation of such
Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding in equity or at law.
SECTION 3.03 No Conflicts. The Transactions (a) do not require any consent or approval of, registration
or filing with, or any other action by, any Governmental Authority, except (i) such as have been
obtained or made and are in full force and effect, (ii) filings necessary to perfect Liens created
by the Loan Documents (as reflected in the applicable Perfection Certificate) and (iii) consents,
approvals, registrations, filings, permits or actions the failure to obtain or perform which could
not reasonably be expected to result in a Material Adverse Effect, (b) will not violate the
Organizational Documents of any Company, (c) will not violate any material requirement of
Applicable Law, (d) will not violate or result in a default or require any consent or approval
under any indenture, agreement or other instrument binding upon any Company or its property, or
give rise to a right thereunder to require any payment to be made by any Company, except for
violations, defaults or the creation of such rights that could not reasonably be expected to result
in a Material Adverse Effect and except for consents received pursuant to the Debt Tender Offer,
and (e) will not result in the creation or imposition of any Lien on any property of any Company,
except Liens created by the Loan Documents and Permitted Liens. The execution, delivery and
performance of the Loan Documents will not violate, or result in a default under, or require any
consent or approval under, the Senior Notes, the Senior Note Documents, or the Term Loan Documents.
The Total Revolving Commitment and Obligations constitute Indenture Permitted Debt.
SECTION 3.04 Financial Statements; Projections.
(a) Historical Financial Statements. The Administrative Borrower has
heretofore delivered to the Lenders the consolidated balance sheets and related statements of
income, stockholders equity and cash flows of Parent Borrower (i) as of and for the fiscal
years ended March 31, 2009, and March 31, 2010, audited by and accompanied by the unqualified
opinion of PricewaterhouseCoopers, independent public accountants, and (ii) as of and for the
six-month period ended September 30, 2010, and for the comparable period of the preceding fiscal
year, in each case, certified by the chief financial officer of Parent Borrower. Such financial
statements and all financial statements delivered pursuant to Section 5.01(a) and,
Section 5.01(b) have been prepared in accordance with U.S. GAAP and present fairly in
all material respects the financial condition and results of operations and cash flows of Parent
Borrower as of the dates and for the periods to which they relate.
(b) No Liabilities. Except as set forth in the most recent financial
statements referred to in Section 3.04(a), as of the Closing Date there are no
liabilities of any Company of any kind, whether accrued, contingent, absolute, determined,
determinable or otherwise, which could reasonably be expected to result in a Material Adverse
Effect, other than liabilities under the Loan Documents, the Term Loan Documents and the Senior
Notes. Since
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March 31, 2010, there has been no event, change, circumstance or occurrence that,
individually or in the aggregate, has had or could reasonably be expected to result in a
Material Adverse Effect.
(c) Pro Forma Financial Statements. Borrowers have heretofore delivered to the
Lenders in the Confidential Information Memorandum, the Parent Borrowers unaudited pro forma
consolidated capitalization table as of September 30, 2010, after giving effect to the
Transactions as if they had occurred on such date. Such capitalization table has been prepared
in good faith by the Loan Parties, based on the assumptions stated therein (which assumptions
are believed by the Loan Parties on the date hereof to be reasonable), are based on the best
information available to the Loan Parties as of the date of delivery thereof, accurately reflect
all adjustments required to be made to give effect to the Transactions and present fairly in all
material respects the pro forma capitalization of Holdings as of such date assuming the
Transactions had occurred at such date.
(d) Forecasts. The forecasts of financial performance of the Parent Borrower
and its subsidiaries furnished to the Lenders have been prepared in good faith by the Loan
Parties and based on assumptions believed by the Loan Parties to be reasonable, it being
understood that any such forecasts may vary from actual results and such variations may be
material.
SECTION 3.05 Properties.
(a) Generally. Each Company has good title to, valid leasehold interests in,
or license of, all its property material to its business, free and clear of all Liens except for
Permitted Liens. The property that is material to the business of the Companies, taken as a
whole, (i) is in good operating order, condition and repair in all material respects (ordinary
wear and tear excepted) and (ii) constitutes all the property which is required for the business
and operations of the Companies as presently conducted.
(b) Real Property. Schedules 8(a) and 8(b) to the Perfection
Certificate dated the Closing Date contain a true and complete list of each interest in Real
Property (i) owned by any Loan Party as of the date hereof having fair market value of
$1,000,000 or more and describes the type of interest therein held by such Loan Party and
whether such owned Real Property is leased to a third party and (ii) leased, subleased or
otherwise occupied or utilized by any Loan Party, as lessee, sublessee, franchisee or licensee,
as of the date hereof having annual rental payments of $1,000,000 or more and describes the type
of interest therein held by such Loan Party.
(c) No Casualty Event. No Company has as of the date hereof received any
notice of, nor has any knowledge of, the occurrence or pendency or contemplation of any Casualty
Event affecting all or any material portion of its property. No Mortgage encumbers improved
Real Property located in the United States that is located in an area that has been identified
by the Secretary of Housing and Urban Development as an area having special flood hazards within
the meaning of the National Flood Insurance Act of 1968 unless flood insurance available under
such Act has been obtained in accordance with Section 5.04.
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(d) Collateral. Each Company owns or has rights to use all of the Collateral
used in, necessary for or material to each Companys business as currently conducted, except
where the failure to have such ownership or rights of use could not reasonably be expected to
have a Material Adverse Effect. The use by each Company of such Collateral does not infringe on
the rights of any person other than such infringement which could not, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect. No claim has been
made and remains outstanding that any Companys use of any Collateral does or may violate the
rights of any third party that could, individually or in the aggregate, reasonably be expected
to result in a Material Adverse Effect.
SECTION 3.06 Intellectual Property.
(a) Ownership/No Claims. Each Loan Party owns, or is licensed to use, all
patents, trademarks, copyrights and other intellectual property (including intellectual property
in software, mask works, inventions, designs, trade names, service marks, technology, trade
secrets, proprietary information and data, domain names, know-how and processes) necessary for
the conduct of such Loan Partys business as currently conducted (Intellectual Property),
except for those the failure to own or license which, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect. As of the date hereof, no
material claim has been asserted and is pending by any person, challenging or questioning the
validity of any Loan Partys Intellectual Property or the validity or enforceability of any such
Intellectual Property, nor does any Loan Party know of any valid basis for any such claim. The
use of any Intellectual Property by each Loan Party, and the conduct of each Loan Partys
business as currently conducted, does not infringe or otherwise violate the rights of any third
party in respect of Intellectual Property, except for such claims and infringements that,
individually or in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect.
(b) Registrations. Except pursuant to non-exclusive licenses and other
non-exclusive use agreements entered into by each Loan Party in the ordinary course of business,
and except as set forth on Schedule 12(c) to the Perfection Certificate, on and as of the date
hereof each Loan Party owns and possesses the right to use and has not authorized or enabled any
other person to use, any Intellectual Property listed on any schedule to the relevant Perfection
Certificate or any other Intellectual Property that is material to its business, except for
such authorizations and enablements as could not reasonably be expected to result in a Material
Adverse Effect. All registrations listed on Schedule 12(a) and 12(b) to the Perfection
Certificate are valid and in full force and effect, in each case, except where the absence of
such validity or full force and effect, individually or collectively, could not reasonably be
expected to have a Material Adverse Effect.
(c) No Violations or Proceedings. To each Loan Partys knowledge, on and as of
the date hereof, (i) there is no material infringement or other violation by others of any right
of such Loan Party with respect to any Intellectual Property listed on any schedule to the
relevant Perfection Certificate, or any other Intellectual Property that is material to its
business, except as may be set forth on Schedule 3.06(c), and (ii) no claims are pending
or threatened to such effect except as set forth on Schedule 3.06(c).
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SECTION 3.07 Equity Interests and Subsidiaries.
(a) Equity Interests. Schedules 1(a) and 10 to the Perfection
Certificate dated the Closing Date set forth a list of (i) all the Subsidiaries of Holdings and
their jurisdictions of organization as of the Closing Date and (ii) the number of each class of
its Equity Interests authorized, and the number outstanding, on the Closing Date and the number
of shares covered by all outstanding options, warrants, rights of conversion or purchase and
similar rights at the Closing Date. As of the Closing Date, all Equity Interests of each
Company held by Holdings or a Subsidiary thereof are duly and validly issued and are fully paid
and non-assessable, and, other than the Equity Interests of Holdings, are owned by Holdings,
directly or indirectly through Wholly Owned Subsidiaries except as indicated on Schedules
1(a) and 10 to the Perfection Certificate. At all times prior to a Qualified Parent
Borrower IPO, the Equity Interests of the Parent Borrower will be owned directly by Holdings.
As of the Closing Date, each Loan Party is the record and beneficial owner of, and has good and
marketable title to, the Equity Interests pledged by it under the Security Documents, free of
any and all Liens, rights or claims of other persons, except Permitted Liens, and as of the
Closing Date there are no outstanding warrants, options or other rights to purchase, or
shareholder, voting trust or similar agreements outstanding with respect to, or property that is
convertible into, or that requires the issuance or sale of, any such Equity Interests other than
with respect to the Forward Share Sale Agreement.
(b) No Consent of Third Parties Required. Except as have previously been
obtained, no consent of any person including any other general or limited partner, any other
member of a limited liability company, any other shareholder or any other trust beneficiary is
necessary in connection with the creation, perfection or First Priority (subject to the
Intercreditor Agreement) status of the security interest of the Collateral Agent in any Equity
Interests pledged to the Collateral Agent for the benefit of the Secured Parties under the
Security Documents or the exercise by the Collateral Agent of the voting or other rights
provided for in the Security Documents or the exercise of remedies in respect thereof, other
than any restrictions on transfer of the Equity Interests in NKL or its direct parents, 4260848
Canada Inc. and 4260856 Canada Inc., imposed by any lock-up or listing agreement, rule or
regulation in connection with any listing or offering of Equity Interests in NKL to the extent
required by Applicable Law or listing or stock exchange requirements.
(c) Organizational Chart. An accurate organizational chart, showing the
ownership structure of Holdings, Borrowers and each Subsidiary on the Closing Date is set forth
on Schedule 10 to the Perfection Certificate dated the Closing Date.
SECTION 3.08 Litigation; Compliance with Laws. There are no actions, suits or proceedings at law or in
equity by or before any Governmental Authority now pending or, to the knowledge of any Company,
threatened against or affecting any Company or any business, property or rights of any Company (i)
that involve any Loan Document or (ii) as to which there is a reasonable possibility of an adverse
determination and that, if adversely determined, could reasonably be expected, individually or in
the aggregate, to result in a Material Adverse Effect. No Company or any of its property is in
violation of, nor will the continued operation of its property as currently conducted violate, any
Applicable Law (including any zoning or building ordinance, code or approval or any building
permits) or any restrictions of record or agreements
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affecting any Companys Real Property or is in default with respect to any requirement of
Applicable Law, where such violation or default, individually or in the aggregate, could reasonably
be expected to result in a Material Adverse Effect.
SECTION 3.09 Agreements. No Company is a party to any agreement or instrument or subject to any
corporate or other constitutional restriction that has resulted or could reasonably be expected to
result in a Material Adverse Effect. No Company is in default in any manner under any provision of
any indenture or other agreement or instrument evidencing Indebtedness, or any other agreement or
instrument to which it is a party or by which it or any of its property is or may be bound, where
such default could reasonably be expected to result in a Material Adverse Effect. There is no
existing default under any Organizational Document of any Company or any event which, with the
giving of notice or passage of time or both, would constitute a default by any party thereunder
that could reasonably be expected to have a Material Adverse Effect. No event or circumstance has
occurred or exists that constitutes a Default or Event of Default.
SECTION 3.10 Federal Reserve Regulations. No Company is engaged principally, or as one of its important
activities, in the business of extending credit for the purpose of buying or carrying Margin Stock.
No part of the proceeds of any Loan or any Letter of Credit will be used, whether directly or
indirectly, and whether immediately, incidentally or ultimately, for any purpose that entails a
violation of, or that is inconsistent with, the provisions of the regulations of the Board,
including Regulation T, U or X. The pledge of the Securities Collateral pursuant to the Security
Documents does not violate such regulations.
SECTION 3.11 Investment Company Act. No Company is an investment company or a company controlled by
an investment company, as defined in, or subject to regulation under, the Investment Company Act
of 1940, as amended.
SECTION 3.12 Use of Proceeds. The Borrowers will use the proceeds of the Revolving Loans and Swingline
Loans (a) on the Closing Date for the Refinancing, (b) to fund a portion of the Closing Date
Distribution and (c) on and after the Closing Date for general corporate purposes (including to
effect Permitted Acquisitions and Dividends permitted hereunder) and for payment of fees, premiums
and expenses in connection with the Transactions.
SECTION 3.13 Taxes. Each Company has (a) timely filed or caused to be timely filed all material Tax
Returns required by Applicable Law to have been filed by it and (b) duly and timely paid, collected
or remitted or caused to be duly and timely paid, collected or remitted all material Taxes due and
payable, collectible or remittable by it and all assessments received by it, except Taxes (i) that
are being contested in good faith by appropriate proceedings and for which such Company has set
aside on its books adequate reserves in accordance with U.S. GAAP or other applicable accounting
rules and (ii) which could not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect. Each Company has made adequate provision in accordance with U.S. GAAP or
other applicable accounting rules for all material Taxes not yet due and payable. No Company has
received written notice of any proposed or pending tax assessments, deficiencies or audits that
could be reasonably expected to, individually or in the aggregate, result in a Material Adverse
Effect. No Company has ever been a party to any understanding or arrangement constituting a tax
shelter within the meaning of Section
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6111(c), Section 6111(d) or Section 6662(d)(2)(C)(iii) of the Code, or has ever participated in a
reportable transaction within the meaning of Treasury Regulation Section 1.6011-4, except as
could not be reasonably expected to, individually or in the aggregate, result in a Material Adverse
Effect.
SECTION 3.14 No Material Misstatements. The written information (including the Confidential Information
Memorandum), reports, financial statements, certificates, exhibits or schedules furnished by or on
behalf of any Company to any Agent or any Lender in connection with the negotiation of any Loan
Document or included therein or delivered pursuant thereto, taken as a whole, did not and does not
contain any material misstatement of fact and, taken as a whole, did not and does not omit to state
any material fact necessary to make the statements therein, in the light of the circumstances under
which they were or are made, not materially misleading in their presentation of Holdings, the
Parent Borrower and their Subsidiaries taken as a whole as of the date such information is dated or
certified; provided that to the extent any such information, report, financial statement,
exhibit or schedule was based upon or constitutes a forecast or projection, each Loan Party
represents only that it was prepared in good faith and based on assumptions believed by the
applicable Loan Parties to be reasonable.
SECTION 3.15 Labor Matters. As of the Closing Date, there are no material strikes, lockouts or labor
slowdowns against any Company pending or, to the knowledge of any Company, threatened in writing.
The hours worked by and payments made to employees of any Company have not been in violation of the
Fair Labor Standards Act of 1938, as amended, or any other applicable federal, state, provincial,
local or foreign law dealing with such matters in any manner which could reasonably be expected to
result in a Material Adverse Effect. All payments due from any Company, or for which any claim may
be made against any Company, on account of wages and employee health and welfare insurance and
other benefits, have been paid or accrued as a liability on the books of such Company except where
the failure to do so could not reasonably be expected to result in a Material Adverse Effect. The
consummation of the Transactions will not give rise to any right of termination or right of
renegotiation on the part of any union under any collective bargaining agreement to which any
Company is bound, except as could not reasonably be expected to result in a Material Adverse
Effect.
SECTION 3.16 Solvency. (i) At the time of and immediately after the consummation of the Transactions
to occur on the Closing Date and after giving effect to the application of the proceeds of each
Loan made on such date, the Closing Date Distribution and the operation of the Contribution,
Intercompany, Contracting and Offset Agreement, (a) the fair value of the assets of each Loan Party
(individually and on a consolidated basis with its Subsidiaries) will exceed its debts and
liabilities, subordinated, contingent, prospective or otherwise; (b) the present fair saleable
value of the property of each Loan Party (individually and on a consolidated basis with its
Subsidiaries) will be greater than the amount that will be required to pay the probable liability
of its debts and other liabilities, subordinated, contingent, prospective or otherwise, as such
debts and other liabilities become absolute and matured; (c) each Loan Party (individually and on a
consolidated basis with its Subsidiaries) will be able to pay its debts and liabilities,
subordinated, contingent, prospective or otherwise, as such debts and liabilities become absolute
and matured; (d) each Loan Party (individually and on a consolidated basis with its Subsidiaries)
will not have unreasonably small capital with which to conduct its business in which it is engaged
as such business is now conducted and is proposed to be conducted following the Closing Date; and
(e)
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each Loan Party is not insolvent as such term is defined under any Debtor Relief Laws of any
jurisdiction in which any Loan Party is organized or incorporated (as applicable), or otherwise
unable to pay its debts as they fall due.
(ii) At the time of and immediately following the making of each Loan and after giving
effect to the application of the proceeds of each Loan and the operation of the Contribution,
Intercompany, Contracting and Offset Agreement, (a) the fair value of the assets of each Borrower,
Borrowing Base Guarantor and Receivables Seller (for purposes of this Section 3.16, a
Principal Loan Party) (individually and on a consolidated basis with its Subsidiaries) will
exceed its debts and liabilities, subordinated, contingent, prospective or otherwise; (b) the
present fair saleable value of the property of each Principal Loan Party (individually and on a
consolidated basis with its Subsidiaries) will be greater than the amount that will be required to
pay the probable liability of its debts and other liabilities, subordinated, contingent,
prospective or otherwise, as such debts and other liabilities become absolute and matured; (c) each
Principal Loan Party (individually and on a consolidated basis with its Subsidiaries) will be able
to pay its debts and liabilities, subordinated, contingent, prospective or otherwise, as such debts
and liabilities become absolute and matured; (d) each Principal Loan Party (individually and on a
consolidated basis with its Subsidiaries) will not have unreasonably small capital with which to
conduct its business in which it is engaged as such business is now conducted and is proposed to be
conducted following the Closing Date; and (e) each Principal Loan Party is not insolvent as such
term is defined under any Debtor Relief Laws of any jurisdiction in which such Principal Loan Party
is organized or incorporated (as applicable), or otherwise unable to pay its debts as they fall
due.
SECTION 3.17 Employee Benefit Plans. Each Company and its ERISA Affiliates is in compliance in all
material respects with the applicable provisions of ERISA and the Code and the regulations and
published interpretations thereunder except for such non-compliance that in the aggregate would not
have a Material Adverse Effect. No ERISA Event has occurred or is reasonably expected to occur
that, when taken together with all other such ERISA Events, could reasonably be expected to result
in a Material Adverse Effect or the imposition of a Lien on any of the property of any Company.
The present value of all accumulated benefit obligations of all underfunded Plans (based on the
assumptions used in the most recent actuarial valuations used for the respective Plans) did not, as
of the date of the most recent financial statements reflecting such amounts, exceed the fair market
value of the property of all such underfunded Plans in an amount which could reasonably be expected
to have a Material Adverse Effect. Using actuarial assumptions and computation methods consistent
with subpart I of subtitle E of Title IV of ERISA, the aggregate liabilities of each Company or its
ERISA Affiliates to all Multiemployer Plans in the event of a complete withdrawal therefrom, as of
the close of the most recent fiscal year of each such Multiemployer Plan, could not reasonably be
expected to result in a Material Adverse Effect.
To the extent applicable, each Foreign Plan has been maintained in compliance with its terms
and with the requirements of Applicable Law and has been maintained, where required, in good
standing with applicable Governmental Authority and Taxing Authority, except for such
non-compliance that in the aggregate would not have a Material Adverse Effect. No Company has
incurred any obligation in connection with the termination of or withdrawal from any Foreign Plan,
except to the extent of liabilities which could not reasonably be expected to have a
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Material Adverse Effect. Each Foreign Plan that is required to be funded is funded in
accordance with the requirements of Applicable Law, and with respect to each Foreign Plan that is
not required to be funded, the obligations of such Foreign Plan are properly accrued in the
financial statements of the Parent Borrower and its Subsidiaries, in each case in an amount that
could not reasonably be expected to have a Material Adverse Effect.
Except as specified on Schedule 3.17, (i) no Company is or has at any time been an
employer (for the purposes of Sections 38 to 51 of the Pensions Act 2004) of an occupational
pension scheme which is not a money purchase scheme (both terms as defined in the Pensions Schemes
Act 1993), and (ii) no Company is or has at any time been connected with or an associate of (as
those terms are used in Sections 39 and 43 of the Pensions Act 2004) such an employer.
SECTION 3.18 Environmental Matters.
(a) Except as, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect:
(i) The Companies and their businesses, operations and Real Property are in compliance
with, and the Companies have no liability under, any applicable Environmental Law;
(ii) The Companies have obtained all Environmental Permits required for the conduct of
their businesses and operations, and the ownership, operation and use of their property, under
Environmental Law, and all such Environmental Permits are valid and in good standing;
(iii) There has been no Release or threatened Release of Hazardous Material on, at, under
or from any Real Property or facility presently or formerly owned, leased or operated by the
Companies or their predecessors in interest that could reasonably be expected to result in
liability of the Companies under any applicable Environmental Law;
(iv) There is no Environmental Claim pending or, to the knowledge of any Company,
threatened against the Companies, or relating to the Real Property currently or formerly owned,
leased or operated by the Companies or their predecessors in interest or relating to the operations
of the Companies, and, to the knowledge of any Company, there are no actions, activities,
circumstances, conditions, events or incidents that could reasonably be expected to form the basis
of such an Environmental Claim;
(v) No Lien has been recorded or, to the knowledge of any Company, threatened under any
Environmental Law with respect to any Real Property or other assets of the Companies;
(vi) The execution, delivery and performance of this Agreement and the consummation of the
transactions contemplated hereby will not require any notification, registration, filing,
reporting, disclosure, investigation, remediation or cleanup pursuant to any Governmental Real
Property Disclosure Requirements or any other applicable Environmental Law; and
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(vii) No person with an indemnity or contribution obligation to the Companies relating to
compliance with or liability under Environmental Law is in default with respect to such obligation.
(b) As of the Closing Date:
(i) Except as could not reasonably be expected to have a Material Adverse Effect, no
Company is obligated to perform any action or otherwise incur any expense under Environmental Law
pursuant to any order, decree, judgment or agreement by which it is bound or has assumed by
contract, agreement or operation of law, and no Company is conducting or financing any Response
pursuant to any Environmental Law with respect to any Real Property or any other location; and
(ii) No Real Property or facility owned, operated or leased by the Companies and, to the
knowledge of the Companies, no Real Property or facility formerly owned, operated or leased by the
Companies or any of their predecessors in interest is (i) listed or proposed for listing on the
National Priorities List promulgated pursuant to CERCLA, or (ii) listed on the Comprehensive
Environmental Response, Compensation and Liability Information System promulgated pursuant to
CERCLA and is reasonably likely to result in any material liability to any Company, or (iii)
included on any other publicly available list of contaminated sites maintained by any Governmental
Authority analogous to CERCLA or the Resource Conservation and Recovery Act, 42 U.S.C. §6901 et
seq., including any such list relating to the management or clean-up of petroleum and is reasonably
likely to result in any material liability to a Company.
SECTION 3.19 Insurance. Schedule 3.19 sets forth a true and correct description of all
insurance policies maintained by each Company as of the Closing Date. All insurance maintained by
the Companies to the extent required by Section 5.04 is in full force and effect, and all
premiums thereon have been duly paid. As of the Closing Date, no Company has received notice of
violation or cancellation thereof, the Mortgaged Property, and the use, occupancy and operation
thereof, comply in all material respects with all Insurance Requirements, and there exists no
material default under any Insurance Requirement. Each Company has insurance in such amounts and
covering such risks and liabilities as are customary for companies of a similar size engaged in
similar businesses in similar locations.
SECTION 3.20 Security Documents.
(a) U.S. Security Agreement. The U.S. Security Agreement is effective to
create in favor of the Collateral Agent for the benefit of the Secured Parties, legal, valid and
enforceable Liens on, and security interests in, the Security Agreement Collateral referred to
therein and, when (i) financing statements and other filings in appropriate form are filed in
the offices specified on Schedule 7 to the relevant Perfection Certificate as in effect
on the Closing Date and (ii) upon the taking of possession or control by the Collateral Agent of
the Security Agreement Collateral with respect to which a security interest may be perfected
only by possession or control (which possession or control shall be given to the Collateral
Agent to the extent possession or control by the Collateral Agent is required by each Security
Agreement), the Liens created by the Security Agreement shall constitute valid, perfected
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First Priority Liens on, and security interests in, all right, title and interest of the
grantors thereunder in the Security Agreement Collateral (other than such Security Agreement
Collateral in which a security interest cannot be perfected under the UCC as in effect at the
relevant time in the relevant jurisdiction), in each case subject to no Liens other than
Permitted Liens.
(b) Canadian Security Agreement. Each of the Canadian Security Agreements is
effective to create in favor of the Collateral Agent for the benefit of the Secured Parties,
legal, valid and enforceable Liens on, and security interests in, the Security Agreement
Collateral referred to therein and, when PPSA financing statements and other filings in
appropriate form are filed in the offices specified on Schedule 7 to the relevant
Perfection Certificate as in effect on the Closing Date, the Liens created by such Canadian
Security Agreement shall constitute valid, perfected First Priority Liens on, and security
interests in, all right, title and interest of the grantors thereunder in the Security Agreement
Collateral referred to therein (other than such Security Agreement Collateral in which a
security interest cannot be perfected under the PPSA as in effect at the relevant time in the
relevant jurisdiction), in each case subject to no Liens other than Permitted Liens.
(c) U.K. Security Agreement. The U.K. Security Agreement is effective to
create in favor of the Collateral Agent for the benefit of the Secured Parties, legal, valid and
enforceable Liens on, and security interests in, the Security Agreement Collateral referred to
therein and, upon the registration specified on Schedule 7 to the relevant Perfection
Certificate as in effect on the Closing Date, the Liens created by the U.K. Security Agreement
shall constitute valid, perfected First Priority Liens on, and security interests in, all right,
title and interest of the grantors thereunder in the Security Agreement Collateral referred to
therein (other than such Security Agreement Collateral in which a security interest cannot be
perfected under Applicable Law as in effect at the relevant time in the relevant jurisdiction),
in each case subject to no Liens other than Permitted Liens.
(d) Swiss Security Agreement. The Swiss Security Agreement is effective to
create in favor of the Collateral Agent for the benefit of the Secured Parties, legal, valid and
enforceable Liens on, and security interests in, the Security Agreement Collateral referred to
therein and, upon the registrations, recordings and other actions specified on Schedule 7 to the
relevant Perfection Certificate as in effect on the Closing Date, the Liens created by the Swiss
Security Agreement shall constitute valid, perfected First Priority Liens on, and security
interests in, all right, title and interest of the grantors thereunder in the Security Agreement
Collateral referred to therein (other than such Security Agreement Collateral in which a
security interest cannot be perfected under Applicable Law as in effect at the relevant time in
the relevant jurisdiction), in each case subject to no Liens other than Permitted Liens.
(e) German Security Agreement. The German Security Agreement is effective to
create in favor of the Collateral Agent for the benefit of the Secured Parties, or in the case
of accessory security, in favor of the Secured Parties, legal, valid and enforceable Liens on,
and security interests in, the Security Agreement Collateral referred to therein and, upon the
registrations, recordings and other actions specified on Schedule 7 to the relevant
Perfection Certificate as in effect on the Closing Date, the Liens created by the German
Security Agreement shall constitute valid, perfected First Priority Liens on, and security
interests in, all
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right, title and interest of the grantors thereunder in the Security Agreement Collateral
referred to therein (other than such Security Agreement Collateral in which a security interest
cannot be perfected under Applicable Law as in effect at the relevant time in the relevant
jurisdiction), in each case subject to no Liens other than Permitted Liens.
(f) Irish Security Agreement. The Irish Security Agreement is effective to
create in favor of the Collateral Agent for the benefit of and as trustee for the Secured
Parties, legal, valid and enforceable Liens on, and security interests in, the Security
Agreement Collateral referred to therein and, upon the registrations, recordings and other
actions specified on Schedule 7 to the relevant Perfection Certificate as in effect on
the Closing Date, the Liens created by the Irish Security Agreement shall constitute valid,
perfected First Priority Liens on, and security interests in, all right, title and interest of
the grantors thereunder in the Security Agreement Collateral referred to therein (other than
such Security Agreement Collateral in which a security interest cannot be perfected under
Applicable Law as in effect at the relevant time in the relevant jurisdiction), in each case
subject to no Liens other than Permitted Liens.
(g) Brazilian Security Agreement. Each Brazilian Security Agreement is
effective to create in favor of the Collateral Agent for the benefit of the Secured Parties,
legal, valid and enforceable Liens on, and security interests in, the Security Agreement
Collateral referred to therein and, upon the registrations, recordings and other actions
specified on Schedule 7 to the relevant Perfection Certificate as in effect on the
Closing Date, the Liens created by each of the Brazilian Security Agreement shall constitute
valid, perfected First Priority Liens on, and security interests in, all right, title and
interest of the grantors thereunder in the Security Agreement Collateral referred to therein
(other than such Security Agreement Collateral in which a security interest cannot be perfected
under Applicable Law as in effect at the relevant time in the relevant jurisdiction), in each
case subject to no Liens other than Permitted Liens.
(h) Luxembourg Security Agreement. Each Luxembourg Security Agreement is
effective to create in favor of the Collateral Agent for the benefit of the Secured Parties,
legal, valid and enforceable Liens on, and security interests in, the Security Agreement
Collateral referred to therein and, upon the registrations, recordings and other actions
specified on Schedule 7 to the relevant Perfection Certificate as in effect on the
Closing Date, the Liens created by each of the Luxembourg Security Agreement shall constitute
valid, perfected First Priority Liens on, and security interests in, all right, title and
interest of the grantors thereunder in the Security Agreement Collateral referred to therein
(other than such Security Agreement Collateral in which a security interest cannot be perfected
under Applicable Law as in effect at the relevant time in the relevant jurisdiction), in each
case subject to no Liens other than Permitted Liens.
(i) Madeira Security Agreement. Each Madeira Security Agreement is effective
to create in favor of the Collateral Agent for the benefit of the Secured Parties, legal, valid
and enforceable Liens on, and security interests in, the Security Agreement Collateral referred
to therein and, upon the registrations, recordings and other actions specified on Schedule
7 to the relevant Perfection Certificate as in effect on the Closing Date, the Liens created
by each of the Madeira Security Agreement shall constitute valid, perfected First Priority Liens
on, and
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security interests in, all right, title and interest of the grantors thereunder in the
Security Agreement Collateral referred to therein (other than such Security Agreement Collateral
in which a security interest cannot be perfected under Applicable Law as in effect at the
relevant time in the relevant jurisdiction), in each case subject to no Liens other than
Permitted Liens.
(j) French Security Agreement. Each French Security Agreement is effective to
create in favor of the French Collateral Agent for the benefit of the Secured Parties, legal,
valid and enforceable Liens on, and security interests in, the Security Agreement Collateral
referred to therein and, upon the registrations, recordings and other actions specified on
Schedule 7 to the relevant Perfection Certificate as in effect on the Closing Date, the
Liens created by each of the French Security Agreement shall constitute valid, perfected First
Priority Liens on, and security interests in, all right, title and interest of the grantors
thereunder in the Security Agreement Collateral referred to therein (other than such Security
Agreement Collateral in which a security interest cannot be perfected under Applicable Law as in
effect at the relevant time in the relevant jurisdiction), in each case subject to no Liens
other than Permitted Liens.
(k) Intellectual Property Filings. When the (i) financing statements and other
filings in appropriate form referred to on Schedule 7 to the relevant Perfection
Certificate have been made, and (ii) U.S. Security Agreement or a short form thereof is filed in
the United States Patent and Trademark Office and the United States Copyright Office, the Liens
created by such Security Agreement shall constitute valid, perfected First Priority Liens on,
and security interests in, all right, title and interest of the grantors thereunder in Patents
and Trademarks (each as defined in such Security Agreement) that are registered or applied for
by any Loan Party with the United States Patent and Trademark Office or Copyrights (as defined
in such Security Agreement) registered or applied for by any Loan Party with the United States
Copyright Office, as the case may be, in each case subject to no Liens other than Permitted
Liens.
(l) Mortgages. Each Mortgage (other than a Mortgage granted by a U.K. Borrower
or a U.K. Guarantor) is effective to create, in favor of the Collateral Agent, for its benefit
and the benefit of the Secured Parties, legal, valid, perfected and enforceable First Priority
Liens on, and security interests in, all of the Loan Parties right, title and interest in and
to the Mortgaged Properties thereunder and the proceeds thereof, subject only to Permitted
Liens, and when such Mortgages are filed in the offices specified on Schedule 8(a) to
the applicable Perfection Certificates dated the Closing Date (or, in the case of any Mortgage
executed and delivered after the date thereof in accordance with the provisions of Section
5.11 and Section 5.12, when such Mortgage is filed in the offices specified in the
local counsel opinion delivered with respect thereto in accordance with the provisions of
Section 5.11 and Section 5.12), the Mortgages shall constitute First Priority
fully perfected Liens on, and security interests in, all right, title and interest of the Loan
Parties in the Mortgaged Properties and the proceeds thereof, in each case prior and superior in
right to any other person, other than Permitted Liens.
The Mortgages granted by the U.K. Borrower and each applicable U.K. Guarantor under the
relevant U.K. Security Agreement are effective to create in favor of the Collateral Agent, for the
ratable benefit of the Secured Parties, legal, valid and enforceable Liens on all of each such
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Loan Partys right, title and interest in and to the Mortgaged Property thereunder and the
proceeds thereof, and when the Mortgages are filed with the Land Registry, the Mortgages shall
constitute fully perfected First Priority Liens on, and security interest in, all right, title and
interest of the U.K. Borrower and each applicable U.K. Guarantor in such Mortgaged Property and the
proceeds thereof, in each case prior and superior in right to any other Person, other than with
respect to the rights of Persons pursuant to Permitted Liens until terminated in accordance with
the terms hereof.
(m) Valid Liens. Each Security Document delivered pursuant to Section
5.11, Section 5.12 and Section 5.16 will, upon execution and delivery
thereof, be effective to create in favor of the Collateral Agent, for the benefit of the Secured
Parties, legal, valid and enforceable Liens on, and security interests in, all of the Loan
Parties right, title and interest in and to the Collateral thereunder, and (i) when all
appropriate filings, registrations or recordings and other actions set forth in the relevant
Perfection Certificate are made in the appropriate offices as may be required under Applicable
Law and (ii) upon the taking of possession or control by the Collateral Agent of such Collateral
with respect to which a security interest may be perfected only by possession or control (which
possession or control shall be given to the Collateral Agent to the extent required by any
Security Document), such Security Document will constitute First Priority fully perfected Liens
on, and security interests in, all right, title and interest of the Loan Parties in such
Collateral, in each case subject to no Liens other than the applicable Permitted Liens.
(n) Receivables Purchase Agreement. The German Receivables Purchase Agreement,
and, upon execution and delivery thereof, each other Receivables Purchase Agreement, is in full
force and effect. Each representation and warranty under any Receivables Purchase Agreement of
each Loan Party party thereto is true and correct on and as of the date made thereunder. No
Termination Event (as defined therein) has occurred under any Receivables Purchase Agreement.
SECTION 3.21 Material Indebtedness Documents. Schedule 3.21 lists, as of the Closing Date, (i)
each material New Senior Note Document, (ii) each material Term Loan Document, and (iii) each
material agreement, certificate, instrument, letter or other document evidencing any other Material
Indebtedness, and the Lenders have been furnished true and complete copies of each of the
foregoing.
SECTION 3.22 Anti-Terrorism Law. No Loan Party is in violation of any requirement of Applicable Law
relating to terrorism or money laundering, including Executive Order No. 13224 on Terrorist
Financing, effective September 24, 2001 (the Executive Order), the Act, Part II.1 of the Criminal
Code, R.S.C. 1985, c. C-46, the Proceeds of Crime (Money Laundering) and Terrorist Financing Act,
S.C.2000, C.17, regulations promulgated pursuant to the Special Economic Measures Act, S.C. 1992
c.17 and the United Nations Act, R.S.C. 1985, c U-2. (collectively, Anti-Terrorism Laws).
No Loan Party and to the knowledge of the Loan Parties, no broker or other agent of any Loan
Party acting or benefiting in any capacity in connection with the Loans is any of the following:
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(i) a person that is listed in the annex to, or is otherwise subject to the provisions of,
the Executive Order;
(ii) a person owned or controlled by, or acting for or on behalf of, any person that is
listed in the annex to, or is otherwise subject to the provisions of, the Executive Order;
(iii) a person with which any Lender is prohibited from dealing or otherwise engaging in
any transaction by any Anti-Terrorism Law;
(iv) a person that commits, threatens or conspires to commit or supports terrorism as
defined in the Executive Order; or
(v) a person that is named as a specially designated national and blocked person on the
most current list published by the U.S. Treasury Department Office of Foreign Assets Control
(OFAC) at its official website or any replacement website or other replacement official
publication of such list.
No Loan Party and, to the knowledge of the Loan Parties, no broker or other agent of any Loan
Party acting in any capacity in connection with the Loans (w) conducts any business or engages in
making or receiving any contribution of funds, goods or services to or for the benefit of any
person described in clauses (i) through (v) above, (x) deals in, or otherwise engages in any
transaction relating to, any property or interests in property blocked pursuant to the Executive
Order or Anti-Terrorism Laws, (y) engages in or conspires to engage in any transaction that evades
or avoids, or has the purpose of evading or avoiding, or attempts to violate, any of the
prohibitions set forth in any Anti-Terrorism Law, or (z) is in violation of any applicable
Anti-Terrorism Laws.
SECTION 3.23 Joint Enterprise. Each Loan Party has requested that the Agents and Lenders make this
credit facility available to the Loan Parties on a combined basis, in order to finance the Loan
Parties business most efficiently and economically. The Loan Parties business is a mutual and
collective enterprise, and the successful operation of each Loan Party is dependent upon the
successful performance of the integrated group. The Loan Parties believe that consolidation of
their credit facility will enhance the borrowing power of each Loan Party and ease administration
of the facility, all to their mutual advantage. The Loan Parties acknowledge that Agents and
Lenders willingness to extend credit and to administer the Collateral on a combined basis
hereunder is done solely as an accommodation to Loan Parties and at Loan Parties request.
SECTION 3.24 Location of Material Inventory and Equipment. Schedule 3.24 sets forth as of the
Closing Date all locations where the aggregate value of Inventory and Equipment (other than mobile
Equipment or Inventory in transit) owned by the Loan Parties at each such location exceeds
$1,000,000.
SECTION 3.25 Accuracy of Borrowing Base. At the time any Borrowing Base Certificate is delivered
pursuant to this Agreement, each Account and each item of Inventory included in the calculation of
the Borrowing Base satisfies all of the criteria stated herein to be an Eligible Account and an
item of Eligible Inventory, respectively.
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SECTION 3.26 Senior Notes; Material Indebtedness. The Obligations constitute Senior Debt or
Designated Senior Indebtedness (or any other defined term having a similar purpose) within the
meaning of the Senior Note Documents (and any Permitted Refinancings thereof permitted under
Section 6.01 other than refinancings with additional Term Loans). The Commitments and the
Loans and other extensions of credit under the Loan Documents constitute Credit Facilities (or
any other defined term having a similar purpose) within the meaning of the Senior Note Documents
(and any Permitted Refinancings thereof permitted under Section 6.01 other than
refinancings with additional Term Loans). The consummation of each of (i) the Transactions, (ii)
each incurrence of Indebtedness hereunder and (iii) the granting of the Liens provided for under
the Security Documents to secure the Secured Obligations is permitted under, and, in each case,
does not require any consent or approval under, the terms of (A) the Senior Note Documents (and any
Permitted Refinancings thereof), the Term Loan Documents (and any Permitted Term Loan Facility
Refinancings thereof) or any other Material Indebtedness or (B) any other material agreement or
instrument binding upon any Company or any of its property except, in the case of this clause (B),
as could not reasonably be expected to result in a Material Adverse Effect or as contemplated in
the amendments to the Existing Senior Note Documents effectuated in connection with the Debt Tender
Offer.
SECTION 3.27 Centre of Main Interests and Establishments. For the purposes of The Council of the
European Union Regulation No. 1346/2000 on Insolvency Proceedings (the Regulation), (i) the
centre of main interest (as that term is used in Article 3(1) of the Regulation) of each U.K. Loan
Party is situated in England and Wales, (ii) the centre of main interest of the Irish Guarantor is
situated in Ireland or Germany, and it has no establishment (as that term is used in Article 2(h)
of the Regulation) in any jurisdiction other than Ireland or Germany, (iii) the centre of main
interest of each Swiss Loan Party is situated in Switzerland, and in each case each has no
establishment (as that term is used in Article 2(h) of the Regulation) in any other jurisdiction,
(iv) the centre of main interest of German Seller is situated in Germany, (v) the centre of main
interest of each Luxembourg Guarantor is situated in Luxembourg, and in each case each has no
establishment (as that term is used in Article 2(h) of the Regulation) in any other jurisdiction,
(vi) the centre of main interest of each French Guarantor is situated in France, and in each case
each has no establishment (as that term is used in Article 2(h) of the Regulation) in any other
jurisdiction, and (vii) other than as provided in paragraph (ii) above, no Loan Party (to the
extent such Loan Party is subject to the Regulation) shall have a centre of main interest other
than as situated in its jurisdiction of incorporation.
SECTION 3.28 Holding and Dormant Companies. Except as may arise under the Loan Documents, the Term Loan
Documents or any Permitted Holdings Indebtedness or (in the case of Novelis Europe Holdings
Limited) the New Senior Notes and any Existing Senior Notes that are not purchased or cancelled
pursuant to the Debt Tender Offer, neither Holdings nor Novelis Europe Holdings Limited, trades or
has any liabilities or commitments (actual or contingent, present or future) other than liabilities
attributable or incidental to acting as a holding company of shares in the Equity Interests of its
Subsidiaries.
SECTION 3.29 Certain Subsidiaries. The Excluded Collateral Subsidiaries as of the Closing Date are
listed on Schedule 1.01(e). The Excluded Subsidiaries as of the Closing Date are listed on
Schedule 1.01(f). The Joint Venture Subsidiaries as of the Closing Date are listed on
Schedule 1.01(g). There are no Unrestricted Subsidiaries as of the Closing Date.
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ARTICLE IV
CONDITIONS TO CREDIT EXTENSIONS
SECTION 4.01 Conditions to Initial Credit Extension. The obligation of each Lender and, if applicable,
each Issuing Bank to fund the initial Credit Extension requested to be made by it shall be subject
to the prior or concurrent satisfaction of each of the conditions precedent set forth in this
Section 4.01.
(a) Loan Documents. The Administrative Agent shall have received executed
counterparts of each of the following, properly executed by a Responsible Officer of each
applicable signing Loan Party, each in form and substance reasonably satisfactory to the
Administrative Agent and each of the Lenders:
(i) this Agreement,
(ii) each Foreign Guarantee;
(iii) the initial Borrowing Base Certificate,
(iv) the Intercreditor Agreement;
(v) the Contribution, Intercompany, Contracting and Offset Agreement;
(vi) the German Receivables Purchase Agreement;
(vii) a Note executed by each applicable Borrower in favor of each Lender that has
requested a Note prior to the Closing Date;
(viii) the U.S. Security Agreement, each Canadian Security Agreement, each U.K. Security
Agreement, each Swiss Security Agreement, each German Security Agreement, each Irish Security
Agreement, each Brazilian Security Agreement, each Luxembourg Security Agreement, each Madeira
Security Agreement, each French Security Agreement, and each other Security Document reasonably
requested by the Administrative Agent prior to the Closing Date; and
(ix) the Perfection Certificates.
(b) Corporate Documents. The Administrative Agent shall have received:
(i) a certificate of the secretary, assistant secretary or managing director (where
applicable) of each Loan Party dated the Closing Date, certifying (A) that attached thereto is a
true and complete copy of each Organizational Document (or its equivalent including the
constitutional documents) of such Loan Party certified (to the extent customary in the applicable
jurisdiction) as of a recent date by the Secretary of State (or equivalent Governmental Authority)
of the jurisdiction of its organization, (B) that attached thereto is a true and complete copy of
resolutions duly adopted by the Board of Directors and/or shareholders, as applicable, of such Loan
Party authorizing the execution, delivery and performance of the Loan Documents to
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which such person is a party and, in the case of Borrowers, the borrowings hereunder, and that
such resolutions, or any other document attached thereto, have not been modified, rescinded,
amended or superseded and are in full force and effect, (C) as to the incumbency and specimen
signature of each officer executing any Loan Document or any other document delivered in connection
herewith on behalf of such Loan Party (together with a certificate of another officer as to the
incumbency and specimen signature of the secretary, assistant secretary or managing director
executing the certificate in this clause (i), and other customary evidence of incumbency) and (D)
that the borrowing, guarantee, or granting of Liens with respect to the Loans or any of the other
Secured Obligations would not cause any borrowing, guarantee, security or similar limit binding on
any Loan Party to be exceeded;
(ii) a certificate as to the good standing (where applicable, or such other customary
functionally equivalent certificates or abstracts) of each Loan Party (in so-called long-form if
available) as of a recent date, from such Secretary of State (or other applicable Governmental
Authority);
(iii) evidence that the records of the applicable Loan Parties at the United Kingdom
Companies House and each other relevant registrar of companies (or equivalent Governmental
Authority) in the respective jurisdictions of organization of the Loan Parties are accurate,
complete and up to date and that the latest relevant accounts have been duly filed, where
applicable;
(iv) if relevant, evidence that each Irish Guarantor has done all that is necessary to
follow the procedures set out in Sub-Sections (2) and (11) of section 60 of the Companies Act 1963
of Ireland in order to enable it to enter into the Loan Documents;
(v) a copy of the constitutional documents of any Person incorporated in Ireland whose
shares are subject to security under any Security Document, together with any resolutions of the
shareholders of such Person adopting such changes to the constitutional documents of that Person to
remove any restriction on any transfer of shares or partnership interests (or equivalent) in such
Person pursuant to any enforcement of any such Security Document;
(vi) evidence that each of the Loan Parties are members of the same group of companies
consisting of a holding company and its subsidiaries for the purposes of Section 155 of the
Companies Act 1963 of Ireland and Section 35 of the Companies Act 1990 of Ireland; and
(vii) such other documents as the Lenders, the Initial Issuing Bank or the Administrative
Agent may reasonably request.
(c) Officers Certificate. The Administrative Agent shall have received a
certificate, dated the Closing Date and signed by a Responsible Officer of the Parent Borrower,
certifying (i) compliance with the conditions precedent set forth in this Section 4.01
and Section 4.02(b) and (c), (ii) that no Default has occurred and is
continuing, and (iii) that each of the representations and warranties made by any Loan Party set
forth in ARTICLE III hereof or in any other Loan Document were true and correct in all
material respects on and as of the Closing Date, except to the extent such representations and
warranties expressly
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related to an earlier date, in which case such representation and warranty shall have been
true and correct in all material respects as of such earlier date.
(d) Financings and Other Transactions, etc.
(i) The Transactions referred to in clauses (a) through (d) and clause (g) of the
definition thereof shall have been consummated or shall be consummated simultaneously on the
Closing Date, in each case in all material respects in accordance with the terms hereof and the
terms of the Transaction Documents, without the waiver or amendment of any such terms not approved
by the Administrative Agent and the Arranger other than any waiver or amendment thereof that is not
materially adverse to the interests of the Lenders.
(ii) The Parent Borrower shall contemporaneously receive an aggregate of $1,500,000,000 in
gross proceeds from borrowings under the Term Loan Credit Agreement.
(iii) The Refinancing shall be consummated contemporaneously with the transactions
contemplated hereby in full to the satisfaction of the Lenders with all Liens in favor of the
existing lenders being unconditionally released; the Administrative Agent shall have received a
pay-off letter in form and substance reasonably satisfactory to the Administrative Agent with
respect to all debt being refinanced in the Refinancing; and the Administrative Agent shall have
received from any person holding any Lien securing any such debt, such UCC termination statements,
mortgage releases, releases of assignments of leases and rents, releases of security interests in
Intellectual Property, or undertakings to provide registrable releases, and other instruments, in
each case in proper form for recording, as the Administrative Agent shall have reasonably requested
to release and terminate of record the Liens securing such debt.
(e) Financial Statements; Pro Forma Balance Sheet; Projections. The
Administrative Agent shall have received the financial statements described in Section
3.04(a) and the pro forma capitalization table described in Section 3.04(c),
together with forecasts of the financial performance of the Companies.
(f) Indebtedness and Minority Interests. After giving effect to the
Transactions and the other transactions contemplated hereby, no Company shall have outstanding
any Indebtedness or preferred stock other than (i) the Loans and Credit Extensions hereunder,
(ii) the Term Loans, (iii) the Existing Senior Notes, (iv) Indebtedness listed on Schedule
6.01(b), (v) Indebtedness owed to, and preferred stock held by, any Borrower or any
Guarantor to the extent permitted hereunder and (vi) other Indebtedness permitted under
Section 6.01.
(g) Opinions of Counsel. The Administrative Agent shall have received, on
behalf of itself, the other Agents, the Arranger, the Lenders and the Issuing Banks, (i) a
favorable written opinion of Fried, Frank, Harris, Shriver & Jacobson LLP, special counsel for
the Loan Parties, and (ii) a favorable written opinion of each local and foreign counsel of the
Loan Parties listed on Schedule 4.01(g), in each case (A) dated the Closing Date, (B)
addressed to the Agents, the Issuing Banks and the Lenders and (C) covering the matters set
forth in Exhibit N and such other matters relating to the Loan Documents and the
Transactions as the Administrative Agent shall reasonably request.
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(h) Solvency Certificate. The Administrative Agent shall have received a
solvency certificate in the form of Exhibit O (or in such other form as is satisfactory
to the Administrative Agent to reflect applicable legal requirements), dated the Closing Date
and signed by a senior Financial Officer of each Loan Party or the Parent Borrower.
(i) Applicable Law. The Administrative Agent shall be satisfied that Holdings,
the Borrowers and their Subsidiaries and the Transactions shall be in full compliance with all
material Applicable Law, including Regulations T, U and X of the Board, and shall have received
satisfactory evidence of such compliance reasonably requested by them.
(j) Consents. All approvals of Governmental Authorities and third parties
necessary to consummate the Transactions shall been obtained and shall be in full force and
effect.
(k) Litigation. There shall be no governmental or judicial action, actual or
threatened, that has or would have, singly or in the aggregate, a reasonable likelihood of
restraining, preventing or imposing burdensome conditions on the Transactions.
(l) [intentionally omitted].
(m) Fees. The Arranger and Administrative Agent shall have received all Fees
and other amounts due and payable on or prior to the Closing Date, including, to the extent
invoiced, reimbursement or payment of all reasonable out-of-pocket expenses (including the
reasonable legal fees and expenses of Skadden, Arps, Slate, Meagher & Flom LLP, special counsel
to the Agents, and the reasonable fees and expenses of any local counsel, foreign counsel,
appraisers, consultants and other advisors) required to be reimbursed or paid by any Loan Party
hereunder or under any other Loan Document.
(n) Personal Property Requirements. The Collateral Agent shall have received:
(i) except to the extent otherwise provided in the Intercreditor Agreement, all
certificates, agreements or instruments, if any, representing or evidencing the Securities
Collateral accompanied by instruments of transfer and stock powers undated and endorsed in blank;
(ii) except to the extent otherwise provided in the Intercreditor Agreement, the
Intercompany Note executed by and among the Parent Borrower and each of its Subsidiaries,
accompanied by instruments of transfer undated and endorsed in blank;
(iii) except to the extent otherwise provided in the Intercreditor Agreement, all other
certificates, agreements or instruments necessary to perfect the Collateral Agents security
interest in all Chattel Paper, Instruments and Investment Property (as each such term is
defined in the U.S. Security Agreement) of each Loan Party to the extent required hereby or under
the relevant Security Documents;
(iv) UCC financing statements in appropriate form for filing under the UCC, filings with
the United States Patent and Trademark Office and United States Copyright Office PPSA filings, and
such other documents under Applicable Law in each jurisdiction as may be
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necessary or appropriate or, in the opinion of the Collateral Agent, desirable to perfect the
Liens created, or purported to be created, by the Security Documents;
(v) certified copies of UCC, United States Patent and Trademark Office and United States
Copyright Office, PPSA, tax and judgment lien searches, bankruptcy and pending lawsuit searches or
equivalent reports or searches (in jurisdictions where such searches are available), each of a
recent date listing all outstanding financing statements, lien notices or comparable documents that
name any Loan Party as debtor and that are filed in those state and county (or other applicable)
jurisdictions in which any property of any Loan Party (other than Inventory in transit) is located
and the state and county (or other applicable) jurisdictions in which any Loan Party is organized
or maintains its principal place of business and such other searches that the Collateral Agent
deems necessary or appropriate, none of which are effective to encumber the Collateral covered or
intended to be covered by the Security Documents (other than Permitted Liens);
(vi) evidence acceptable to the Collateral Agent of payment or arrangements for payment by
the Loan Parties of all applicable recording taxes, fees, charges, costs and expenses required for
the recording of the Security Documents;
(vii) evidence that all Liens (other than Permitted Liens) affecting the assets of the
Loan Parties have been or will be discharged on or before the Closing Date (or, in the case of
financing statement filings or similar notice of lien filings that do not evidence security
interests (other than security interests that are discharged on or before the Closing Date), that
arrangements with respect to the release or termination thereof satisfactory to the Administrative
Agent have been made);
(viii) copies of all notices required to be sent and other documents required to be
executed under the Security Documents;
(ix) all share certificates, duly executed and stamped stock transfer forms and other
documents of title required to be provided under the Security Documents; and
(x) evidence that the records of the U.K. Borrower, Novelis Services Limited and Novelis
Europe Holding Limited at the United Kingdom Companies House are accurate, complete and up to date
and that the latest relevant accounts have been duly filed.
(o) Real Property Requirements. The Collateral Agent shall have received:
(i) a Mortgage encumbering each Mortgaged Property for the benefit of the Secured Parties,
duly executed and acknowledged by each Loan Party that holds any direct interest in such Mortgaged
Property, and otherwise in form for recording in the recording office of each applicable political
subdivision where each such Mortgaged Property is situated, together with such certificates,
affidavits, questionnaires or returns as shall be required in connection with the recording or
filing thereof to create a lien under Applicable Law, and such financing statements and any other
instruments necessary to grant a mortgage lien under the laws of any applicable jurisdiction, all
of which shall be in form and substance reasonably satisfactory to Collateral Agent;
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(ii) with respect to each Mortgaged Property, such consents, approvals, amendments,
supplements, estoppels, tenant subordination agreements or other instruments as necessary to
consummate the Transactions or as shall reasonably be deemed necessary by the Administrative Agent
in order for the owner or holder of the fee or leasehold interest constituting such Mortgaged
Property to grant the Lien contemplated by the Mortgage with respect to such Mortgaged Property;
(iii) with respect to each Mortgage of property located in the United States, Canada or,
to the extent reasonably requested by the Administrative Agent, any other jurisdictions, (a) a
policy of title insurance (or marked up title insurance commitment having the effect of a policy of
title insurance) insuring the Lien of such Mortgage as a valid, perfected mortgage Lien on the
Mortgaged Property and fixtures described therein having the priority specified in the
Intercreditor Agreement in the amount equal to not less than 115% of the fair market value of such
Mortgaged Property and fixtures, which fair market value is set forth on Schedule
4.01(o)(iii), which policy (or such marked-up commitment) (each, a Title Policy) shall (A) be
issued by the Title Company, (B) to the extent necessary, include such reinsurance arrangements
(with provisions for direct access, if necessary) as shall be reasonably acceptable to the
Collateral Agent, (C) contain a tie-in or cluster endorsement, if available under Applicable
Law (i.e., policies which insure against losses regardless of location or allocated value of the
insured property up to a stated maximum coverage amount), (D) have been supplemented by such
endorsements (or where such endorsements are not available, opinions of special counsel, architects
or other professionals reasonably acceptable to the Collateral Agent) as shall be reasonably
requested by the Administrative Agent (including endorsements on matters relating to usury, first
loss, last dollar, zoning, contiguity, revolving credit, doing business, non-imputation, public
road access, survey, variable rate, environmental lien, subdivision, mortgage recording tax,
separate tax lot, revolving credit, and so-called comprehensive coverage over covenants and
restrictions), and (E) contain no exceptions to title other than exceptions acceptable to the
Collateral Agent, it being acknowledged that Permitted Liens of the type described in Section
6.02(a), 6.02(b), 6.02(d), 6.02(f) (clause (x) only), 6.02(g),
and 6.02(k) shall be acceptable or (b) in respect of Mortgaged Property situated outside
the United States, a title opinion of the Parent Borrowers local counsel in form and substance
reasonably satisfactory to the Collateral Agent;
(iv) with respect to each applicable Mortgaged Property, such affidavits, certificates,
information (including financial data) and instruments of indemnification (including a so-called
gap indemnification) as shall be required to induce the Title Company to issue the Title
Policy/ies and endorsements contemplated above;
(v) evidence reasonably acceptable to the Collateral Agent of payment by the applicable
Borrowers of all Title Policy premiums, search and examination charges, escrow charges and related
charges, mortgage recording taxes, fees, charges, costs and expenses required for the recording of
the Mortgages and issuance of the Title Policies referred to above;
(vi) with respect to each Mortgaged Property, copies of all Leases in which any Loan Party
or any Restricted Subsidiary holds the lessors interest or other agreements relating to possessory
interests, if any, in each case providing for annual rental payments in excess of $500,000. To the
extent any of the foregoing affect any Mortgaged Property, such agreement
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shall be subordinate to the Lien of the Mortgage to be recorded against such Mortgaged
Property, either expressly by its terms or pursuant to a subordination, non-disturbance and
attornment agreement, and shall otherwise be reasonably acceptable to the Collateral Agent;
(vii) with respect to each Mortgaged Property, each Company shall have made all material
notifications, registrations and filings, to the extent required by, and in accordance with, all
Governmental Real Property Disclosure Requirements applicable to such Mortgaged Property;
(viii) to the extent requested by the Administrative Agent, Surveys with respect to the
Mortgaged Properties;
(ix) with respect to each Mortgaged Property situated in the United States, a completed
Federal Emergency Management Agency Standard Flood Hazard Determination acknowledged notice to the
applicable Loan Party and flood insurance (if appropriate) for each such Mortgaged Property;
(x) (a) title deeds to each real property situated in England and Wales secured in favor
of the Collateral Agent; or (b) a letter (reasonably satisfactory to the Collateral Agent) from
solicitors holding those title deeds undertaking to hold them to the order of the Collateral Agent;
or (c) if any document is at the Land Registry, a certified copy of that document and a letter from
the U.K. Borrowers solicitors directing the registry to issue the document to the Collateral Agent
or its solicitors; and
(xi) in relation to property situated in England and Wales, if applicable, satisfactory
priority searches at the Land Registry and Land Charges Searches, giving not less that 25 Business
Days priority notice beyond the date of the debenture and evidence that no Lien is registered
against the relevant property (other than Permitted Liens or any Liens that will be released on the
date of first drawdown, such searches to be addressed to or capable of being relied upon by the
Secured Parties).
(p) Insurance. The Administrative Agent shall have received a copy of, or a
certificate as to coverage under, the property and liability insurance policies required by
Section 5.04 and the applicable provisions of the Security Documents, each of which
shall be endorsed or otherwise amended to include a standard lenders loss payable or
mortgagee endorsement (as applicable) and shall name the Collateral Agent, on behalf of the
Secured Parties, as additional insured, in form and substance reasonably satisfactory to the
Administrative Agent.
(q) USA Patriot Act. The Lenders shall have received, sufficiently in advance
of the Closing Date, all documentation and other information that may be required by the Lenders
in order to enable compliance with applicable know your customer and anti-money laundering
rules and regulations, including the Act (including, without limitation, the information
described in Section 11.13).
(r) Minimum Liquidity. The sum of unrestricted cash of the Parent Borrower and
its Restricted Subsidiaries (as of November 30, 2010) plus Excess Availability
(determined based upon the Borrowing Base as of November 30, 2010, and Revolving Commitments,
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Loans and L/C Exposure as of the Closing Date) shall be not less than $750,000,000, of
which at least $500,000,000 must consist of Excess Availability, all calculated on a pro forma
basis to give effect to the full $1,700,000,000 permitted amount of the Closing Date
Distribution and the other Transactions (including the initial Borrowings and issuance of
Letters of Credit and assumption of Existing Letters of Credit as of the Closing Date).
(s) Initial Borrowing Base Certificate. The Collateral Agent and the
Administrative Agent shall have received a Borrowing Base Certificate, dated the Closing Date
and certifying the Borrowing Base as of November 30, 2010.
(t) Debt Tender Offers; New Senior Notes.
(i) All Existing Senior Notes tendered and not properly withdrawn prior to the Closing
Date in accordance with the terms set forth in the applicable Debt Tender Offers have been, or
concurrently with the Closing Date will be, consummated in accordance with the terms set forth in
the applicable Offer to Purchase and Consent Solicitation Statement of the Parent Borrower dated
November 26, 2010, in each case as in effect on the Closing Date and, concurrent with the
effectiveness hereof on the Closing Date, shall have been accepted for payment and will be acquired
and cancelled.
(ii) Amendments to the terms of the Existing Senior Notes eliminating substantially all of
the covenants and defaults thereunder shall have become operative as contemplated by the Debt
Tender Offer.
(iii) The Administrative Agent shall have received satisfactory evidence that not less
than $2,500,000,000 in aggregate principal amount of New Senior Notes have been, or concurrently
with the Closing Date will be, issued by the Parent Borrower.
(u) Cash Management. The Collateral Agent and the Administrative Agent shall
have reviewed and approved the Companies cash management system.
(v) Process Agent. The Collateral Agent and the Administrative Agent shall
have received evidence of the acceptance by the Process Agent of its appointment as such by the
Loan Parties.
(w) Capital Structure. The Lenders shall be satisfied with the capital
structure and indebtedness of the Loan Parties.
(x) Material Adverse Change. In the opinion of the Collateral Agent and the
Administrative Agent, since March 31, 2010, there has been no event, change, circumstance or
occurrence that, individually or in the aggregate, has had or could reasonably be expected to
result in a material adverse effect on the business, property, results of operations or
financial condition of the Loan Parties and their Subsidiaries, taken as a whole.
Notwithstanding the foregoing, to the extent that the execution and delivery of any document or the
completion of any task or action is listed on Schedule 5.16, such item shall not be a
condition precedent and shall instead be subject to Section 5.16.
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SECTION 4.02 Conditions to All Credit Extensions. The obligation of each Lender and each Issuing Bank
to make any Credit Extension (including the initial Credit Extension) shall be subject to, and to
the satisfaction of, each of the conditions precedent set forth below.
(a) Notice. The Administrative Agent shall have received a Borrowing Request
as required by Section 2.03 (or such notice shall have been deemed given in accordance
with Section 2.03) if Loans are being requested or, in the case of the issuance,
amendment, extension or renewal of a Letter of Credit, the applicable Issuing Bank and the
Administrative Agent shall have received an LC Request as required by Section 2.18 or,
in the case of the Borrowing of a Swingline Loan, the Swingline Lender and the Administrative
Agent shall have received a Borrowing Request as required by Section 2.17.
(b) No Default. No Default shall exist, or would result from such proposed
Credit Extension or from the application of the proceeds therefrom.
(c) Representations and Warranties. Each of the representations and warranties
made by any Loan Party set forth in ARTICLE III hereof or in any other Loan Document
shall be true and correct in all material respects on and as of the date of such Credit
Extension with the same effect as though made on and as of such date, except to the extent such
representations and warranties expressly relate to an earlier date, in which case such
representation and warranty shall have been true and correct in all material respects as of such
earlier date.
(d) No Legal Bar. With respect to each Lender, no order, judgment or decree of
any Governmental Authority shall purport to restrain such Lender from making any Loans to be
made by it. No injunction or other restraining order shall have been issued, shall be pending
or noticed with respect to any action, suit or proceeding seeking to enjoin or otherwise prevent
the consummation of, or to recover any damages or obtain relief as a result of, the transactions
contemplated by this Agreement or the making of Loans hereunder.
Each of the delivery of a Borrowing Request or an LC Request and the acceptance by any
Borrower of the proceeds of such Credit Extension shall constitute a representation and warranty by
each Borrower and each other Loan Party that on the date of such Credit Extension (both immediately
before and after giving effect to such Credit Extension and the application of the proceeds
thereof) the conditions contained in Section 4.02(b) through (d) have been
satisfied (which representation and warranty shall be deemed limited to the knowledge of the Loan
Parties in the case of the first sentence of Section 4.02(d)). Borrowers shall provide
such information (including, if applicable, calculations in reasonable detail of the covenants in
Section 6.10) as the Administrative Agent may reasonably request to confirm that the
conditions in Section 4.02(b) through (d) have been satisfied.
ARTICLE V
AFFIRMATIVE COVENANTS
Each Loan Party warrants, covenants and agrees with each Lender that so long as this Agreement
shall remain in effect and until Full Payment of the Obligations, unless the Required
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Lenders shall otherwise consent in writing, each Loan Party will, and will cause each of its
Restricted Subsidiaries to:
SECTION 5.01 Financial Statements, Reports, etc. Furnish to the Administrative Agent (and the
Administrative Agent shall make available to the Lenders, on the Platform or otherwise, in
accordance with its customary procedures):
(a) Annual Reports. As soon as available and in any event within the earlier
of (i) ninety (90) days and (ii) such shorter period as may be required by the Securities and
Exchange Commission (including, if applicable, any extension permitted under Rule 12b-25 of the
Exchange Act), after the end of each fiscal year, beginning with the first fiscal year ending
after the Closing Date, (i) the consolidated balance sheet of Parent Borrower as of the end of
such fiscal year and related consolidated statements of income, cash flows and stockholders
equity for such fiscal year, in comparative form with such financial statements as of the end
of, and for, the preceding fiscal year, and notes thereto, all prepared in accordance with
Regulation S-X and accompanied by an opinion of independent public accountants of recognized
national standing reasonably satisfactory to the Administrative Agent (which opinion shall not
be qualified as to scope or contain any going concern qualification, paragraph of emphasis or
explanatory statement), stating that such financial statements fairly present, in all material
respects, the consolidated financial condition, results of operations and cash flows of Parent
Borrower as of the dates and for the periods specified in accordance with U.S. GAAP, (ii) a
narrative report and managements discussion and analysis, in a form reasonably satisfactory to
the Administrative Agent, of the financial condition and results of operations of Parent
Borrower for such fiscal year, as compared to amounts for the previous fiscal year (it being
understood that the information required by clauses (i) and (ii) of this Section 5.01(a)
may be furnished in the form of a Form 10-K (so long as the financial statements, narrative
report and managements discussion therein comply with the requirements set forth above)) and
(iii) consolidating balance sheets, statements of income and cash flows of the Parent Borrower
and its Restricted Subsidiaries separating out the results by region;
(b) Quarterly Reports. As soon as available and in any event within the
earlier of (i) forty-five (45) days and (ii) such shorter period as may be required by the
Securities and Exchange Commission (including, if applicable, any extension permitted under Rule
12b-25 of the Exchange Act), after the end of each of the first three fiscal quarters of each
fiscal year, (i) the consolidated balance sheet of Parent Borrower as of the end of such fiscal
quarter and related consolidated statements of income and cash flows for such fiscal quarter and
for the then elapsed portion of the fiscal year, in comparative form with the consolidated
statements of income and cash flows for the comparable periods in the previous fiscal year, and
notes thereto, all prepared in accordance with Regulation S-X under the Securities Act and
accompanied by a certificate of a Financial Officer stating that such financial statements
fairly present, in all material respects, the consolidated financial condition, results of
operations and cash flows of Parent Borrower as of the date and for the periods specified in
accordance with U.S. GAAP consistently applied, and on a basis consistent with audited financial
statements referred to in clause (a) of this Section, except as otherwise
disclosed therein and subject to the absence of footnote disclosures and to normal year-end
audit adjustments, (ii) a narrative report and managements discussion and analysis, in a form
reasonably satisfactory to the
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Administrative Agent, of the financial condition and results of operations for such fiscal
quarter and the then elapsed portion of the fiscal year, as compared to the comparable periods
in the previous fiscal year (it being understood that the information required by clauses (i)
and (ii) of this Section 5.01(b) may be furnished in the form of a Form 10-Q (so long as
the financial statements, management report and managements discussion therein comply with the
requirements set forth above)) and (iii) consolidating balance sheets, statements of income and
cash flows of the Parent Borrower and its Restricted Subsidiaries separating out the results by
region;
(c) Monthly Reports. At any time after the occurrence of a Covenant Trigger
Event and prior to the subsequent occurrence of a Covenant Recovery Event, within thirty (30)
days after the end of each of the first two months of each fiscal quarter, (i) the consolidated
balance sheet of the Parent Borrower as of the end of such month and the related consolidated
statements of income and cash flows of the Parent Borrower for each such month and for the then
elapsed portion of the fiscal year, in comparative form with the consolidated statements of
income and cash flows for the comparable periods in the previous fiscal year, accompanied by a
certificate of a Financial Officer stating that such financial statements fairly present, in all
material respects, cash flows of the Parent Borrower as of the date and for the periods
specified, subject to normal quarterly adjustments and year end audit adjustments and (ii) a
management report in a form reasonably satisfactory to the Administrative Agent setting forth
statement of income items and Consolidated EBITDA (Fixed Charge) of the Parent Borrower for such
month and for the then elapsed portion of the fiscal year, showing variance, by Dollar amount
and percentage, from amounts for the comparable periods in the previous fiscal year;
(d) Financial Officers Certificate. (i) Concurrently with any delivery of
financial statements under Section 5.01(a) and (b), a Compliance Certificate (A)
certifying that no Default has occurred or, if such a Default has occurred, specifying the
nature and extent thereof and any corrective action taken or proposed to be taken with respect
thereto, (B) setting forth computations in reasonable detail satisfactory to the Administrative
Agent (including a breakdown of such computations on a quarterly basis) demonstrating compliance
with the covenant contained in Section 6.10 (including a calculation of Consolidated
Fixed Charge Coverage Ratio, whether or not a Covenant Trigger Event has occurred) and (C)
showing a reconciliation of Consolidated EBITDA (Fixed Charge) to the net income set forth on
the statement of income, such reconciliation to be on a quarterly basis; and (ii) to the extent
any Unrestricted Subsidiaries are in existence during the period covered by such financial
statements, consolidating balance sheets, statements of income and cash flows separating out the
results of the Parent Borrower and its Restricted Subsidiaries, on the one hand, and the
Unrestricted Subsidiaries, on the other;
(e) Officers Certificate Regarding Organizational Chart and Perfection of
Collateral. Concurrently with any delivery of financial statements under Section
5.01(a), a certificate of a Responsible Officer of the Administrative Borrower attaching an
accurate organizational chart (or confirming that there has been no change in organizational
structure) and otherwise setting forth the information required pursuant to the Perfection
Certificate Supplement or confirming that there has been no change in such information since the
date of the Perfection Certificate or latest Perfection Certificate Supplement;
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(f) Public Reports. Promptly after the same become publicly available, copies
of all periodic and other reports, proxy statements and other materials filed by any Loan Party
with the Securities and Exchange Commission, or any Governmental Authority succeeding to any or
all of the functions of said Commission, with any national U.S. or non-U.S. securities
regulatory authority or securities exchange or with the National Association of Securities
Dealers, Inc., or distributed to holders of its publicly held Indebtedness or securities
pursuant to the terms of the documentation governing such Indebtedness or securities (or any
trustee, agent or other representative therefor), as the case may be; provided that
documents required to be delivered pursuant to this clause (f) may be delivered electronically
and if so delivered, shall be deemed to have been delivered on the date (i) on which Parent
Borrower posts such documents, or provides a link thereto on Parent Borrowers website (or other
location specified by the Parent Borrower) on the Internet; or (ii) on which such documents are
posted on Parent Borrowers behalf on the Platform; provided that: (i) upon written
request by the Administrative Agent, Parent Borrower shall deliver paper copies of such
documents to the Administrative Agent for further distribution to each Lender until a written
request to cease delivering paper copies is given by the Administrative Agent and (ii) Parent
Borrower shall notify (which may be by facsimile or electronic mail) the Administrative Agent of
the posting of any such documents and provide to the Administrative Agent by electronic mail
electronic versions (i.e., soft copies) of such documents; provided, further,
that notwithstanding anything contained herein, in every instance Parent Borrower shall be
required to provide paper copies or electronic copies through e-mail of the certificates
required by clauses (d) and (e) of this Section 5.01 to the Administrative Agent;
(g) Management Letters. Promptly after the receipt thereof by any Company, a
copy of any management letter, exception report or other similar letter or report received by
any such person from its certified public accountants and the managements responses thereto;
(h) Projections. Within sixty (60) days of the end of each fiscal year, a copy
of the annual projections for Parent Borrower (including balance sheets, statements of income
and sources and uses of cash, for each quarter of the then-current fiscal year prepared in
detail on a consolidated basis, with appropriate presentation and discussion of the principal
assumptions upon which such forecasts are based, accompanied by the statement of a Financial
Officer of the Parent Borrower to the effect that such assumptions are believed to be
reasonable;
(i) Labor Relations. Promptly after becoming aware of the same, written notice
of (a) any labor dispute to which any Loan Party or any of its Restricted Subsidiaries is or is
expected to become a party, including any strikes, lockouts or other labor disputes relating to
any of such persons plants and other facilities, which could reasonably be expected to result
in a Material Adverse Effect, (b) any Worker Adjustment and Retraining Notification Act or
related liability incurred with respect to the closing of any plant or other facility of any
such person and (c) any material liability under Applicable Law similar to the Worker Adjustment
and Retraining Notification Act or otherwise arising out of plant closings;
(j) [intentionally omitted.]
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(k) Asset Sales. Contemporaneous with or prior to (i) an Asset Sale not in
the ordinary course of business, the Net Cash Proceeds of which (or the Dollar Equivalent
thereof) are anticipated to exceed $100,000,000 or (ii) an Asset Sale, the Net Cash Proceeds of
which (or the Dollar Equivalent thereof) are anticipated to exceed $20,000,000 with respect to
any portion of such assets constituting Revolving Credit Priority Collateral, written notice (a)
describing such Asset Sale or the nature and material terms and conditions of such transaction
and (b) stating the estimated Net Cash Proceeds anticipated to be received by any Loan Party or
any of its Restricted Subsidiaries;
(l) Other Information. Promptly, from time to time, such other information
regarding the operations, properties, business affairs and condition (financial or otherwise) of
any Company, or compliance with the terms of any Loan Document, or matters regarding the
Collateral (beyond the requirements contained in Section 9.03) as the Administrative
Agent or any Lender (acting through the Administrative Agent) may reasonably request.
SECTION 5.02 Litigation and Other Notices. Furnish to the Administrative Agent written notice of the
following promptly (and, in any event, within ten (10) Business Days after acquiring knowledge
thereof):
(a) any Default or Event of Default, specifying the nature and extent thereof and the
corrective action (if any) taken or proposed to be taken with respect thereto;
(b) the filing or commencement of, or any written notice of intention of any person to file
or commence, any action, suit, litigation or proceeding, whether at law or in equity by or
before any Governmental Authority, (i) against any Borrower or other Company that in the
reasonable judgment of the Borrowers could reasonably be expected to result in a Material
Adverse Effect if adversely determined or (ii) with respect to any Loan Document;
(c) any development that has resulted in, or could reasonably be expected to result in, a
Material Adverse Effect;
(d) the occurrence of a Casualty Event involving a Dollar Equivalent amount in excess of
$50,000,000 (or in excess of $20,000,000 of Inventory);
(e) any dispute or contest with regard to any Lien that could reasonably be expected to
result in forfeiture of Revolving Credit Priority Collateral having a Dollar Equivalent fair
market value in excess of $1,000,000;
(f) the incurrence of any Lien on Revolving Credit Priority Collateral arising out of or in
connection with any Priority Payable for amounts past due and owing by a Borrower or Borrowing
Base Guarantor, or for an accrued amount for which a Borrower or Borrowing Base Guarantor then
has an obligation to remit to a Governmental Authority or other Person pursuant to a requirement
of Applicable Law and having a Dollar Equivalent value in excess of $1,000,000; and
(g) (i) the incurrence of any Lien (other than Permitted Liens) on the Collateral or (ii)
the occurrence of any other event which could reasonably be expected to be material with
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regard to (x) the Revolving Credit Priority Collateral, taken as a whole, or (y) the Pari Passu
Priority Collateral, taken as a whole.
SECTION 5.03 Existence; Businesses and Properties.
(a) Do or cause to be done all things reasonably necessary to preserve, renew and keep in
full force and effect its legal existence, rights and franchises necessary or desirable in the
normal conduct of its business, except (i) other than with respect to a Borrowers or Borrowing
Base Guarantors legal existence, to the extent the failure to do so would not reasonably be
expected to have a Material Adverse Effect or (ii) pursuant to a transaction permitted by
Section 6.05 or Section 6.06.
(b) Do or cause to be done all things reasonably necessary to obtain, maintain, preserve,
renew, extend and keep in full force and effect the rights, licenses, permits, privileges,
franchises, approvals, authorizations, and Intellectual Property used in or necessary to the
conduct of its business, except where the failure to do so could not reasonably be expected to
result in a Material Adverse Effect; do or cause to be done all things reasonably necessary to
preserve its business and the goodwill and business of the customers, advertisers, suppliers and
others having business relations with each Loan Party or any of its Restricted Subsidiaries,
except where the failure to do so could not reasonably be expected to result in a Material
Adverse Effect; comply with Applicable Law (including any and all zoning, building,
Environmental Law, ordinance, code or approval or any building permits or any restrictions of
record or agreements affecting the Real Property), contractual obligations, and decrees and
orders of any Governmental Authority, whether now in effect or hereafter enacted, except where
the failure to comply, individually or in the aggregate, could not reasonably be expected to
result in a Material Adverse Effect; and at all times maintain, preserve and protect all of its
property and keep such property in good repair, working order and condition (other than wear and
tear occurring in the ordinary course of business) and from time to time make, or cause to be
made, all needful and proper repairs, renewals, additions, improvements and replacements thereto
reasonably necessary in order that the business carried on in connection therewith may be
properly conducted at all times, except in each case where the failure to do so could not
reasonably be expected to result in a Material Adverse Effect.
SECTION 5.04 Insurance.
(a) Generally. Keep its insurable property adequately insured at all times by
financially sound and reputable insurers; maintain such other insurance, to such extent and
against such risks as is customary with companies in the same or similar businesses operating in
the same or similar locations, including insurance with respect to Mortgaged Properties and
other properties material to the business of the Companies against such casualties and
contingencies and of such types and in such amounts with such deductibles as is customary in the
case of similar businesses operating in the same or similar locations, including (i) physical
hazard insurance on an all risk basis (subject to usual and customary exclusions), (ii)
commercial general liability against claims for bodily injury, death or property damage covering
any and all insurable claims, (iii) explosion insurance in respect of any boilers, machinery or
similar apparatus constituting Collateral, (iv) business interruption insurance and, with
respect to Mortgaged Properties located in the United States or in any other
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jurisdiction requiring such insurance, flood insurance (to the extent such flood insurance is required under
clause (c) below), and (v) workers compensation insurance and such other insurance as may be
required by any requirement of Applicable Law; provided that with respect to physical
hazard insurance, neither the Collateral Agent nor the applicable Company shall agree at any
time after the occurrence of a Cash Dominion Trigger Event and prior to the subsequent
occurrence of a Cash Dominion Recovery Event to the adjustment of any claim thereunder with
regard to Inventory having a Dollar Equivalent value in excess of $20,000,000 without the
consent of the other (such consent not to be unreasonably withheld or delayed);
provided, further, that no consent of any Company shall be required during an
Event of Default.
(b) Requirements of Insurance. All such property and liability insurance
maintained by the Loan Parties shall (i) provide that no cancellation, material reduction in
amount or material change in coverage thereof shall be effective until at least thirty (30) days
after receipt by the Collateral Agent of written notice thereof, (ii) name the Collateral Agent
as mortgagee or loss payee, as applicable (in the case of property insurance) or additional
insured on behalf of the Secured Parties (in the case of liability insurance), and (iii) if
reasonably requested by the Collateral Agent, include a breach of warranty clause.
(c) Flood Insurance. Except to the extent already obtained in accordance with
clause (iv) of Section 5.04(a), with respect to each Mortgaged Property located in the
United States or another jurisdiction which requires such type of insurance, obtain flood
insurance in such total amount as the Administrative Agent may from time to time reasonably
require, if at any time the area in which any improvements located on any Mortgaged Property is
designated a flood hazard area in any Flood Insurance Rate Map published by the Federal
Emergency Management Agency (or any successor agency), and such insurance is required to be
obtained pursuant to the requirements of the National Flood Insurance Act of 1968, as amended
from time to time, or the Flood Disaster Protection Act of 1973, as amended from time to time.
(d) Brokers Report. As soon as practicable and in any event within ninety (90)
days after the end of each fiscal year, deliver to the Administrative Agent and the Collateral
Agent (i) a report of a reputable insurance broker with respect to the insurance maintained
pursuant to clauses (i)-(iv) of Section 5.04(a) in form and substance reasonably
satisfactory to the Administrative Agent and the Collateral Agent (together with such additional
reports (provided such reports are readily ascertainable) as the Administrative Agent or the
Collateral Agent may reasonably request), and (ii) such brokers statement that all premiums
then due and payable with respect to the coverage maintained pursuant to clauses
(i)-(iv) of Section 5.04(a) have been paid and confirming, with respect to any
property, physical hazard or liability insurance maintained by a Loan Party, that the Collateral
Agent has been named as loss payee or additional insured, as applicable.
(e) Mortgaged Properties. Each Loan Party shall comply in all material respects
with all Insurance Requirements in respect of each Mortgaged Property; provided,
however, that each Loan Party may, at its own expense and after written notice to the
Administrative Agent, (i) contest the applicability or enforceability of any such Insurance
Requirements by appropriate legal proceedings, the prosecution of which does not constitute a
basis for
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cancellation or revocation of any insurance coverage required under this Section
5.04 or (ii) cause the Insurance Policy containing any such Insurance Requirement to be
replaced by a new policy complying with the provisions of this Section 5.04.
SECTION 5.05 Taxes.
(a) Payment of Taxes. Pay and discharge promptly when due all material Taxes and
governmental charges or levies imposed upon it or upon its income or profits or in respect of
its property, before the same shall become delinquent or in default, as well as all lawful
claims for labor, services, materials and supplies or otherwise that, if unpaid, might give rise
to a Lien other than a Permitted Lien upon such properties or any part thereof; provided
that such payment and discharge shall not be required with respect to any such Tax, charge, levy
or claim so long as (x) the validity or amount thereof shall be contested in good faith by
appropriate proceedings timely instituted and diligently conducted and the applicable Company
shall have set aside on its books adequate reserves or other appropriate provisions with respect
thereto in accordance with U.S. GAAP (or other applicable accounting rules), and (y) such
contest operates to suspend collection of the contested obligation, Tax or charge and
enforcement of a Lien other than a Permitted Lien.
(b) Filing of Tax Returns. Timely file all material Tax Returns required by
Applicable Law to be filed by it.
SECTION 5.06 Employee Benefits.
(a) Comply with the applicable provisions of ERISA and the Code and any Applicable Law
applicable to any Foreign Plan or Compensation Plan, except where any non-compliance could not
reasonably be expected to result in a Material Adverse Effect.
(b) Furnish to the Administrative Agent (x) as soon as possible after, and in any event
within five (5) Business Days after any Responsible Officer of any Company or any ERISA
Affiliates of any Company knows that, any ERISA Event has occurred, a statement of a Financial
Officer of Administrative Borrower setting forth details as to such ERISA Event and the action,
if any, that the Companies propose to take with respect thereto, and (y) upon request by the
Administrative Agent, copies of such other documents or governmental reports or filings relating
to any Plan (or Foreign Plan, or other employee benefit plan sponsored or contributed to by any
Company) as the Administrative Agent shall reasonably request.
(c) (i) Ensure that the Novelis U.K. Pension Plan is funded in accordance with the agreed
schedule of contributions dated May 16, 2007, and that no action or omission is taken by any
Company in relation to such a pension scheme which has or is reasonably likely to have a
Material Adverse Effect; (ii) except for any existing defined benefit pension schemes as
specified on Schedule 3.17 ensure that no Company is or has been at any time an employer
(for the purposes of Sections 38 to 51 of the Pensions Act 2004) of an occupational pension
scheme which is not a money purchase scheme (both terms as defined in the Pension Schemes Act
1993) or connected with or an associate of (as those terms are defined in Sections 39 or 43
of the Pensions Act 2004) such an employer; (iii) deliver to the Administrative Agent upon
request as those reports are prepared in order to comply with the then current statutory
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or
auditing requirements (as applicable either to the trustees of any relevant schemes), actuarial
reports in relation to all pension schemes mentioned in clause (i) above; (iv) promptly notify
the Administrative Agent of any material change in the agreed rate of contributions to any
pension schemes mentioned in clause (i) above; (v) promptly notify the Administrative Agent of
any investigation or proposed investigation by the Pensions Regulator which may lead to the
issue of a Financial Support Direction or a Contribution Notice to any member of the Group; (vi)
promptly notify the Administrative Agent if it receives a Financial Support Direction or a
Contribution Notice from the Pensions Regulator.
(d) Ensure that all Foreign Plans (except the Novelis U.K. Pension Plan) and Compensation
Plans that are required to be funded are funded and contributed to in accordance with their
terms to the extent of Applicable Law, except where any non-compliance could not reasonably be
expected to result in a Material Adverse Effect.
SECTION 5.07 Maintaining Records; Access to Properties and Inspections; Annual Meetings; Field
Examinations and Appraisals.
(a) Keep proper books of record and account in which full, true and correct entries in
conformity in all material respects with GAAP (or other applicable accounting standards) and
Applicable Law of all financial transactions and the assets and business of each Company and its
Restricted Subsidiaries are made of all dealings and transactions in relation to its business
and activities, including, without limitation, proper records of intercompany transactions) with
full, true and correct entries reflecting all payments received and paid (including, without
limitation, funds received by or for the account of any Loan Party from deposit accounts of the
other Companies). Each Company will permit any representatives designated by the Administrative
Agent (who may be accompanied by any Agent or Lender) to visit and inspect the financial records
and the property of such Company on no more than on two occasions per fiscal year so long as no
Event of Default is continuing (at reasonable intervals, during normal business hours and within
five Business Days after written notification of the same to Administrative Borrower, except
that, during the continuance of an Event of Default, none of such restrictions shall be
applicable) and to make extracts from and copies of such financial records, and permit any
representatives designated by the Administrative Agent (who may be accompanied by any Agent or
Lender) to discuss the affairs, finances, accounts and condition of any Company with the
officers and employees thereof and advisors therefor (including independent accountants).
(b) [intentionally omitted.]
(c) The Loan Parties shall cooperate fully with the Collateral Agent and its agents during
all Collateral field audits and Inventory Appraisals, which shall be at the expense of Borrowers
and shall be conducted (x) annually, (y) for the one year period after the occurrence of a Cash
Dominion Trigger Event, semi-annually, or (z) following the occurrence and during the
continuation of an Event of Default, more frequently at Collateral Agents reasonable request.
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SECTION 5.08 Use of Proceeds. Use the proceeds of the Loans only for the purposes set forth in
Section 3.12 and request the issuance of Letters of Credit only for the purposes set forth
in the definition of Commercial Letter of Credit or Standby Letter of Credit, as the case may be.
SECTION 5.09 Compliance with Environmental Laws; Environmental Reports.
(a) Comply, and cause all lessees and other persons occupying Real Property owned, operated
or leased by any Company to comply, in all respects with all Environmental Laws and
Environmental Permits applicable to its operations and Real Property; obtain and renew all
Environmental Permits applicable to its operations and Real Property; and conduct all Responses,
including any emergency response, required by, and in accordance with, Environmental Laws, in
each case, to the extent that the failure to do so could reasonably be expected to have a
Material Adverse Effect; provided that no Company shall be required to undertake any
Response to the extent that its obligation to do so is being contested in good faith and by
proper proceedings and appropriate reserves are being maintained with respect to such
circumstances in accordance with U.S. GAAP or other applicable accounting standards.
(b) If a Default caused by reason of a breach of Section 3.18 or Section
5.09(a) shall have occurred and be continuing for more than thirty (30) days without the
Companies commencing activities reasonably likely to cure such Default in accordance with
Environmental Laws, at the written request of the Administrative Agent or the Required Lenders
through the Administrative Agent, provide to the Lenders as soon as reasonably practicable after
such request, at the expense of Borrowers, an environmental assessment report regarding the
matters which are the subject of such Default, including, where appropriate, soil and/or
groundwater sampling, prepared by an environmental consulting firm and, in form and substance,
reasonably acceptable to the Administrative Agent and indicating the presence or absence of
Hazardous Materials and the estimated cost of any compliance or Response to address them.
SECTION
5.10 Indenture Permitted Debt. Reserve at all times a portion of the Indenture Permitted Debt
equal to the Total Commitment then outstanding for usage for Indebtedness pursuant to the Loan
Documents.
SECTION 5.11 Additional Collateral; Additional Guarantors.
(a) Subject to the terms of the Intercreditor Agreement and this Section 5.11, with
respect to any property acquired after the Closing Date by any Loan Party that is intended to be
subject to the Lien created by any of the Security Documents but is not so subject, promptly
(and in any event within thirty (30) days after the acquisition thereof, provided that
the Administrative Agent may agree to an extension thereof in its sole discretion) (i) execute
and deliver to the Administrative Agent and the Collateral Agent such amendments or supplements
to the relevant Security Documents or such other documents as the Administrative Agent or the
Collateral Agent shall deem necessary or advisable to grant to the Collateral Agent, for its
benefit and for the benefit of the other Secured Parties, a Lien on such property subject to no
Liens other than Permitted Liens, and (ii) take all actions necessary to cause such Lien to be
duly perfected to the extent required by such Security Document in accordance with Applicable
Law, including the filing of financing statements (or other
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applicable filings) in such
jurisdictions as may be reasonably requested by the Administrative Agent; provided that
the actions required by clauses (i) and (ii) above need not be taken if the costs of doing so
are excessive in relation to the benefits afforded thereby, as determined by the Administrative
Agent in its reasonable discretion. The Borrowers shall otherwise take such actions and execute
and/or deliver to Administrative Agent and the Collateral Agent such documents as the
Administrative Agent or the Collateral Agent shall reasonably require to confirm the validity,
perfection and priority of the Lien of the Security Documents against such after-acquired
properties.
(b) With respect to any person that becomes a Restricted Subsidiary after the Closing Date
(other than (y) an Excluded Collateral Subsidiary and (z) a Securitization Entity), or any
Restricted Subsidiary that was an Excluded Collateral Subsidiary but, as of the end of the most
recently ended fiscal quarter, has ceased to be an Excluded Collateral Subsidiary or is required
to become a Loan Party by operation of the provisions of Section 5.11(d), promptly (and
in any event within thirty (30) days after such person becomes a Restricted Subsidiary or ceases
to be an Excluded Collateral Subsidiary or is required to become a Loan Party by operation of
the provisions of Section 5.11(d), provided that the Administrative Agent may
agree to an extension of such time period in its sole discretion) (i) pledge and deliver to the
Collateral Agent the certificates, if any, representing all of the Equity Interests of such
Restricted Subsidiary owned by a Loan Party, together with undated stock powers or other
appropriate instruments of transfer executed and delivered in blank by a duly authorized officer
of the holder(s) of such Equity Interests, and all intercompany notes owing from such Restricted
Subsidiary to any Loan Party together with instruments of transfer executed and delivered in
blank by a duly authorized officer of such Loan Party and (ii) cause any such Restricted
Subsidiary that is a Wholly Owned Subsidiary (other than (A) any Restricted Subsidiary
prohibited from being a Guarantor under any requirement of Applicable Law relating to financial
assistance, maintenance of capital and/or other corporate benefit restrictions and (B) any
Restricted Subsidiaries where providing such guarantee would result in (1) materially adverse
tax consequences, as determined by the Administrative Agent in its reasonable discretion (after
consultation with its counsel) or (2) costs that are excessive in relation to the benefits
afforded thereby, as determined by the Administrative Agent in its reasonable discretion), in
each case to the extent not prohibited by Applicable Law, (A) to execute a Joinder Agreement or
such comparable documentation to become a Subsidiary Guarantor (or, in the case of a Subsidiary
organized under the laws of the United States or any state thereof or the District of Columbia,
a U.S. Borrower) and joinder agreements to the applicable Security Documents (in each case,
substantially in the form annexed thereto or in such other form as may be reasonably
satisfactory to the Administrative Agent) or, in the case of a Foreign Subsidiary, execute such
other Security Documents (or joinder agreements) to the extent possible under and compatible
with the laws of such Foreign Subsidiarys jurisdiction in form and substance reasonably
satisfactory to the Administrative Agent, and (B) to take all actions necessary or advisable in
the opinion of the Administrative Agent or the Collateral Agent to cause the Lien created by the
applicable Security Document to be duly perfected to the extent required by such agreement in
accordance with all Applicable Law, including the filing of financing statements (or other
applicable filings) in such jurisdictions as may be reasonably requested by the Administrative
Agent or the Collateral Agent. Notwithstanding the foregoing, (1) clause (i) of this paragraph
(b) shall not apply to the Equity Interests of (w) any Company listed on Schedule
5.11(b) to the extent any requirement
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of Applicable Law continues to prohibit the pledging
of its Equity Interests to secure the Secured Obligations and any Company acquired or created
after the Closing Date to the extent any requirement of Applicable Law prohibits the pledging of
its Equity Interests to secure the Secured Obligations, (x) any non-Wholly Owned Subsidiary to
the extent that the pledge or perfection of a Lien on such Equity Interests would violate any
anti-assignment or negative pledge provisions of any contract to which such non-Wholly Owned
Subsidiary is a party or the organizational documents or shareholders agreement of such
non-Wholly Owned Subsidiary (but only to the extent such anti-assignment or negative pledge
clause is enforceable under Applicable Law), (y) any Joint Venture Subsidiary, to the extent the
terms of any contract to which such Joint Venture Subsidiary is a party or any applicable joint
venture, stockholders, partnership, limited liability company or similar agreement (other than
any of the foregoing entered into with any Company or any Affiliate of any Company) prohibits or
conditions the pledging of its Equity Interests to secure the Secured Obligations and (z) any
Restricted Subsidiary to the extent such pledge would result in materially adverse tax
consequences, as determined by the Administrative Agent in its reasonable discretion (after
consultation with its counsel) and (2) clause (ii) of this paragraph (b) shall not apply to any
Company listed on Schedule 5.11(b) to the extent any requirement of Applicable Law
prohibits it from becoming a Loan Party.
(c) Subject to the terms of the Intercreditor Agreement, promptly grant to the Collateral
Agent, within sixty (60) days of the acquisition thereof, a security interest in and Mortgage on
each Real Property owned in fee by such Loan Party as is acquired by such Loan Party after the
Closing Date and that, together with any improvements thereon, individually has a fair market
value the Dollar Equivalent of which is at least $10,000,000 (unless the subject property is
already mortgaged to a third party to the extent permitted by Section 6.02 hereof or the
costs of doing so are excessive in relation to the benefits afforded thereby, as determined by
the Administrative Agent in its reasonable discretion), as additional security for the Secured
Obligations. Subject to the terms of the Intercreditor Agreement, such Mortgages shall be
granted pursuant to documentation reasonably satisfactory in form and substance to the
Administrative Agent and the Collateral Agent and shall constitute valid, perfected and
enforceable First Priority Liens subject only to Permitted Liens. Subject to the terms of the
Intercreditor Agreement, the Mortgages or instruments related thereto shall be duly recorded or
filed in such manner and in such places as are required by law to establish, perfect, preserve
and protect the First Priority Liens in favor of the Collateral Agent required to be granted
pursuant to the Mortgages and all taxes, fees and other charges payable in connection therewith
shall be paid in full. Such Loan Party shall otherwise take such actions and execute and/or
deliver to the Collateral Agent such documents as the Administrative Agent or the Collateral
Agent shall reasonably require to confirm the validity, perfection and priority of the Lien of
any existing Mortgage or new Mortgage against such after-acquired Real Property (including a
Title Policy (or title opinion reasonably satisfactory to the Collateral Agent), a Survey (if
applicable in the respective jurisdiction), and a local counsel opinion (in form and substance
reasonably satisfactory to the Administrative Agent and the Collateral Agent) in respect of such
Mortgage). For purposes of this Section 5.11(c) Real Property owned by a Company that
becomes a Loan Party following the Closing Date in accordance with the terms of this Agreement
shall be deemed to have been acquired on the later of (x) the date of acquisition of such Real
Property and (y) the date such Company becomes a Loan Party.
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(d) If, at any time and from time to time after the Closing Date, Restricted Subsidiaries
that are not Loan Parties because they are Excluded Collateral Subsidiaries comprise in the
aggregate more than 7.5% of the Consolidated Total Assets of Parent Borrower and its
Subsidiaries as of the end of the most recently ended fiscal quarter or more than 7.5% of
Consolidated EBITDA of Parent Borrower and its Restricted Subsidiaries as of the end of the most
recently ended fiscal quarter, then the Loan Parties shall, not later than 45 days after the
date by which financial statements for such fiscal quarter are required to be delivered pursuant
to this Agreement, cause one or more of such Restricted Subsidiaries to become Loan Parties
(notwithstanding that such Restricted Subsidiaries are, individually, Excluded Collateral
Subsidiaries) such that the foregoing condition ceases to be true. The Administrative Borrower
may designate a Subsidiary Guarantor that was not a Restricted Subsidiary of the Parent Borrower
on the Closing Date as an Excluded Collateral Subsidiary subject to the terms of the definition
thereof, in which event the Guarantee by such Restricted Subsidiary shall be released in
accordance with Section 7.09 and the Collateral Agent shall release the Collateral
pledged by such Person.
(e) Any Foreign Subsidiary that is a Loan Party that has in the United States at any time
(i) a deposit account that is part of the Cash Management System or the Cash Pooling
Arrangements or (ii) property (other than Excluded Property) having an aggregate fair market
value in excess of $5,000,000 for any such foreign Loan Party, shall execute a joinder agreement
to the U.S. Security Agreement reasonably satisfactory to the Administrative Agent.
(f) Notwithstanding any other provision of this Section 5.11 to the contrary, in no
event shall this Section 5.11 obligate any Loan Party to grant a Lien to the Collateral
Agent on any Excluded Property.
SECTION 5.12 Security Interests; Further Assurances. Subject to the terms of the Intercreditor
Agreement, promptly, upon the reasonable request of the Administrative Agent or the Collateral
Agent, at Borrowers expense, execute, acknowledge and deliver, or cause the execution,
acknowledgment and delivery of, and thereafter register, file or record, or cause to be registered,
filed or recorded, in an appropriate governmental office, any document or instrument supplemental
to or confirmatory of the Security Documents or otherwise deemed by the Administrative Agent or the
Collateral Agent reasonably necessary for the continued validity, perfection and priority of the
Liens on the Collateral covered thereby subject to no other Liens except Permitted Liens, or use
commercially reasonable efforts to obtain any consents or waivers as may be reasonably required in
connection therewith. Deliver or cause to be delivered (using commercially reasonable efforts with
respect to delivery of items from Persons who are not in the control of any Loan Party) to the
Administrative Agent and the Collateral Agent from time to time such other documentation, consents,
authorizations, approvals and orders in form and substance reasonably satisfactory to the
Administrative Agent and the Collateral Agent as the Administrative Agent and the Collateral Agent
shall reasonably deem necessary to perfect or maintain the Liens on the Collateral pursuant to the
Security Documents. Upon the exercise by the Administrative Agent, the Collateral Agent or any
Lender of any power, right, privilege or remedy pursuant to any Loan Document that requires any
consent, approval, registration, qualification or authorization of any Governmental Authority,
execute and deliver all applications, certifications, instruments and other documents and papers
that the Administrative
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Agent, the Collateral Agent or such Lender may reasonably require in
connection therewith. If the Administrative Agent, the Collateral Agent or the Required Lenders
determine that they are required by a requirement of Applicable Law to have appraisals prepared in
respect of the Real Property of any Loan Party constituting Collateral, Borrowers shall provide to
the Administrative Agent appraisals that satisfy the applicable requirements of the Real Estate
Appraisal Reform Amendments of FIRREA (or other applicable requirements) and are otherwise in form
reasonably satisfactory to the Administrative Agent and the Collateral Agent.
SECTION 5.13 Information Regarding Collateral. Not effect any change (i) in any Loan Partys legal name
or in any trade name used to identify it in the conduct of its business or in the ownership of its
properties, (ii) in the location of any Loan Partys chief executive office, its principal place of
business, any office in which it maintains books or records relating to Revolving Credit Priority
Collateral or any other material Collateral owned by it or any office or facility at which such
Collateral owned by it is located (including the establishment of any such new office or facility)
other than changes in location to a property identified on Schedule 3.24, another property
location previously identified on a Perfection Certificate Supplement or Borrowing Base Certificate
or otherwise by notice to the Administrative Agent, as to which the steps required by clause (B)
below have been completed or to a Mortgaged Property or a leased property subject to a Landlord
Access Agreement (it being agreed that this clause (ii) shall not apply to the location of
Inventory of any Loan Party that is not a Borrower or a Borrowing Base Guarantor, Inventory in
transit from a supplier or vendor to a permitted location or between permitted locations or
Inventory in transit to a customer, nor shall it prohibit the any Borrower or Borrowing Base
Guarantor from maintaining Inventory having Dollar Equivalent fair market value not in excess of
$10,000,000 located at locations not identified on Schedule 3.24 or a Perfection
Certificate Supplement or a Borrowing Base Certificate), (iii) in any Loan Partys identity or
organizational structure, (iv) in any Loan Partys Federal Taxpayer Identification Number or
organizational identification number, if any, or (v) in any Loan Partys jurisdiction of
organization (in each case, including by merging with or into any other entity, reorganizing,
dissolving, liquidating, reorganizing or organizing in any other jurisdiction), until (A) it shall
have given the Collateral Agent and the Administrative Agent not less than ten (10) Business Days
prior written notice (in the form of an Officers Certificate) of its intention to do so, or such
lesser notice period agreed to by the Administrative Agent, clearly describing such change and
providing such other information in connection therewith as the Collateral Agent or the
Administrative Agent may reasonably request and (B) it shall have taken all action reasonably
satisfactory to the Administrative Agent to maintain the perfection and priority of the security
interest of the Collateral Agent for the benefit of the Secured Parties in the Collateral, if
applicable. Each Loan Party agrees to promptly provide the Administrative Agent, upon request
therefor, with certified Organizational Documents reflecting any of the changes described in the
preceding sentence. The Borrowers and Borrowing Base Guarantors shall not permit more than
$10,000,000 in the aggregate of their Inventory to be located at any location not listed on
Schedule 3.24 (other than Inventory in transit), as updated from time to time in any
Perfection Certificate Supplement or Borrowing Base Certificate. For the purposes of the
Regulation, (i) no U.K. Loan Party shall change its centre of main interest (as that term is used
in Article 3(1) of the Regulation) from England and Wales, (ii) nor shall Irish Guarantor change
its centre of main interest from Ireland or Germany, nor shall Irish Guarantor have an
establishment (as that term is used in Article 2(h) of the Regulation) in any jurisdiction other
than Ireland or Germany, (iii) nor shall any Swiss Loan Party change its centre of main interest
from Switzerland, nor shall any
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Swiss Loan Party have an establishment in any other jurisdiction,
(iv) nor shall German Seller change its centre of main interest from Germany, (v) nor shall any
Luxembourg Guarantor change its centre of main interest from Luxembourg, nor shall any Luxembourg
Guarantor have an establishment in any other jurisdiction, and (vi) nor shall any French
Guarantor change its centre of main interest from France, nor shall any French Guarantor have an
establishment in any other jurisdiction.
SECTION 5.14 Affirmative Covenants with Respect to Leases. With respect to each Lease to which a Loan
Party is party as landlord or lessor, the respective Loan Party shall perform all the obligations
imposed upon the landlord under such Lease and enforce all of the tenants obligations thereunder,
except where the failure to so perform or enforce could not reasonably be expected to result in a
Property Material Adverse Effect.
SECTION 5.15 Ten Non-Bank Regulations and Twenty Non-Bank Regulations.
(a) Swiss Borrower shall ensure that while it is a Borrower:
(i) the aggregate number of Lenders of Swiss Borrower under this Agreement which are not Swiss
Qualifying Banks must not exceed ten (10), (as per Ten Non-Bank Regulations); and
(ii) the aggregate number of creditors (including the Lenders), other than Swiss Qualifying
Banks, where applicable, of Swiss Borrower under all outstanding loans, facilities and/or private
placements (including under this Agreement) must not at any time exceed twenty (20) (as per Twenty
Non-Bank Regulations), in each case where failure to do so would have, or would reasonably be
expected to have, a Material Adverse Effect.
(b) Swiss Borrower will for the purposes of determining the total number of creditors which
are Swiss Non-Qualifying Banks for the purposes of the 20 Non-Bank Creditor Rule ensure that at
all times at least 10 Lenders that are Swiss Non-Qualifying Banks are permitted as Lenders (the
Permitted Swiss Non-Qualifying Banks) (irrespective of whether or not there are, at any time,
any such Permitted Swiss Non-Qualifying Bank).
SECTION 5.16 Post-Closing Covenants. Execute and deliver the documents and complete the tasks and take
the other actions set forth on Schedule 5.16, in each case within the time limits specified
on such Schedule.
SECTION 5.17 Designation of Subsidiaries. The Parent Borrower may at any time after the Closing Date
designate any Restricted Subsidiary of the Parent Borrower as an Unrestricted Subsidiary or any
Unrestricted Subsidiary as a Restricted Subsidiary; provided that (i) immediately before
and after such designation, no Default shall have occurred and be continuing, (ii) immediately
after giving effect to such designation, the Consolidated Fixed Charge Coverage Ratio shall, on a
Pro Forma Basis, be at least 1.1 to 1.0 (it being understood that, as a condition precedent to the
effectiveness of any such designation, the Parent Borrower shall deliver to the Administrative
Agent a certificate of a Responsible Officer setting forth in reasonable detail the calculations
demonstrating such compliance), (iii) no Subsidiary may be designated as an Unrestricted Subsidiary
or continue as an Unrestricted Subsidiary if it is a Restricted
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Subsidiary for the purpose of any
of the Senior Notes, the Term Loan Agreement, any Additional Senior Secured Indebtedness, any
Junior Secured Indebtedness or any other Indebtedness, as applicable, constituting Material
Indebtedness, (iv) no Restricted Subsidiary may be designated an Unrestricted Subsidiary if it was
previously designated an Unrestricted Subsidiary, (v) if a Restricted Subsidiary is being
designated as an Unrestricted Subsidiary hereunder, the sum of (A) the fair market value of assets
of such Subsidiary as of such date of designation (the Designation Date), plus (B) the
aggregate fair market value of assets of all Unrestricted Subsidiaries designated as Unrestricted
Subsidiaries pursuant to this Section 5.17 prior to the Designation Date (in each case
measured as of the date of each such Unrestricted Subsidiarys designation as an Unrestricted
Subsidiary) shall not exceed $500,000,000 in the aggregate as of such Designation Date pro forma
for such designation, and (vi) no Restricted Subsidiary shall be a Subsidiary of an Unrestricted
Subsidiary. The designation of any Subsidiary as an Unrestricted Subsidiary after the Closing Date
shall constitute an Investment by the Parent Borrower or its applicable Restricted Subsidiary
therein at the date of designation in an amount equal to the fair market value of the Parent
Borrowers or such Restricted Subsidiarys (as applicable) investment therein. The designation of
any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute (i) the incurrence at the
time of designation of any Investment, Indebtedness or Liens of such Subsidiary existing at such
time and (ii) a return on any Investment by the Parent Borrower or any of its Restricted
Subsidiaries in Unrestricted Subsidiaries pursuant to the preceding sentence in an amount equal to
the lesser of (x) the fair market value at the date of such designation of the Parent Borrowers or
its Restricted Subsidiarys (as applicable) Investment in such Subsidiary and (y) the amount of
Investments made by the Parent Borrower or its Restricted Subsidiaries in such Unrestricted
Subsidiary from and after the date of such Subsidiary was designated as an Unrestricted Subsidiary.
Notwithstanding the foregoing, in no case shall any of the Parent Borrower, any U.S. Borrower, the
U.K. Borrower, the Swiss Borrower or any Receivables Seller be an Unrestricted Subsidiary.
ARTICLE VI
NEGATIVE COVENANTS
Each Loan Party warrants, covenants and agrees with each Lender that, so long as this
Agreement shall remain in effect and until Full Payment of the Obligations, unless the Required
Lenders (and such other Lenders whose consent may be required under Section 11.02) shall
otherwise consent in writing, no Loan Party will, nor will they cause or permit any Restricted
Subsidiaries to:
SECTION 6.01 Indebtedness. Incur, create, assume or permit to exist, directly or indirectly, any
Indebtedness, except:
(a) Indebtedness incurred under this Agreement and the other Loan Documents (including
obligations under Bank Product Agreements with Secured Bank Product Providers);
(b) (i) Indebtedness outstanding on the Closing Date and listed on Schedule
6.01(b), and Permitted Refinancings thereof, (ii) Indebtedness of Loan Parties under the
Term Loan Documents and Permitted Term Loan Facility Refinancings thereof, (iii) Indebtedness
under the Existing Senior Note Documents that will be cancelled and cease to be outstanding
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on
the Closing Date in connection with the Debt Tender Offer and (iv) Indebtedness consisting of
Existing Senior Notes outstanding on the Closing Date and not acquired on the Closing Date
pursuant to the Debt Tender Offer;
(c) Indebtedness of any Company under Hedging Agreements (including Contingent Obligations
of any Company with respect to Hedging Agreements of any other Company); provided that
if such Hedging Obligations relate to interest rates, (i) such Hedging Agreements relate to
payment obligations on Indebtedness otherwise permitted to be incurred by the Loan Documents and
(ii) the notional principal amount of such Hedging Agreements at the time incurred does not
exceed the principal amount of the Indebtedness to which such Hedging Agreements relate;
(d) Indebtedness permitted by Section 6.04(i) or (s);
(e) Indebtedness of any Securitization Entity under any Qualified Securitization
Transaction (i) that is without recourse to any Company (other than such Securitization Entity)
or any of their respective assets (other than pursuant to Standard Securitization Undertakings,
and (ii) that are negotiated in good faith at arms length; provided that the sum of (x)
the aggregate outstanding principal amount of the Indebtedness of all Securitization Entities
under all Qualified Securitization Transactions, plus (y) the aggregate amount of
Indebtedness then outstanding under Section 6.01(m), plus (z) the aggregate book
value at the time of determination of the then outstanding Receivables subject to a Permitted
Factoring Facility at such time, at any time outstanding shall not exceed $400,000,000;
(f) Indebtedness in respect of Purchase Money Obligations and Capital Lease Obligations,
and Permitted Refinancings thereof (other than refinancings funded with intercompany advances);
provided that at the time such obligations are incurred, the outstanding amount of
Indebtedness incurred under this clause (f) shall not exceed the greater of 7.5% of Consolidated
Net Tangible Assets and $400,000,000;
(g) Sale and Leaseback Transactions permitted under Section 6.03;
(h) Indebtedness in respect of bid, performance or surety bonds or obligations, workers
compensation claims, self-insurance obligations, financing of insurance premiums, and bankers
acceptances issued for the account of the Parent Borrower or any Restricted Subsidiary, in each
case, incurred in the ordinary course of business (including guarantees or obligations of the
Parent Borrower or any Restricted Subsidiary with respect to letters of credit supporting such
bid, performance or surety bonds or obligations, workers compensation claims, self-insurance
obligations and bankers acceptances) (in each case other than Indebtedness for borrowed money);
(i) Contingent Obligations (i) of any Loan Party in respect of Indebtedness otherwise
permitted to be incurred by such Loan Party under this Section 6.01, (ii) of any Loan
Party in respect of Indebtedness of Restricted Subsidiaries that are not Loan Parties or are
Restricted Grantors in an aggregate amount not exceeding $75,000,000 at any one time outstanding
less all amounts paid with regard to Contingent Obligations permitted pursuant to
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Section 6.04(a), and (iii) of any Company that is not a Loan Party in respect of
Indebtedness otherwise permitted to be incurred by such Company under this Section 6.01;
(j) Indebtedness arising from the honoring by a bank or other financial institution of a
check, draft or similar instrument inadvertently (except in the case of daylight overdrafts)
drawn against insufficient funds in the ordinary course of business; provided that such
Indebtedness is extinguished within five (5) Business Days of incurrence;
(k) Indebtedness arising in connection with endorsement of instruments for deposit in the
ordinary course of business;
(l) unsecured Indebtedness and Junior Secured Indebtedness not otherwise permitted under
this Section 6.01; provided, that (i) such Indebtedness has a final maturity
date that is no earlier than 180 days after the Maturity Date, (ii) such Indebtedness has a
Weighted Average Life to Maturity that is no earlier than 180 days after the Maturity Date,
(iii) no Default is then continuing or would result therefrom, (iv) such Indebtedness is
incurred by the Parent Borrower or Novelis Corporation, and the persons that are (or are
required to be) obligors under such Indebtedness do not consist of any persons other than those
persons that are (or are required to be) Loan Parties, (v) the terms of such Indebtedness do not
require any amortization, mandatory prepayment or redemption or repurchase at the option of the
holder thereof (other than customary offers to purchase upon a change of control or asset sale)
earlier than 180 days after the Maturity Date, (vi) such Indebtedness has terms and conditions
(excluding pricing, premiums and subordination terms) that, when taken as a whole, are not
materially more restrictive or less favorable to the Companies, and are not materially less
favorable to the Lenders, than the terms of the Term Loan Documents (or, if the Term Loan
Documents are no longer in effect, than the Term Loan Documents as in effect immediately prior
to their termination) (except with respect to terms and conditions that are applicable only
after the Maturity Date), (vii) in the case of any such secured Indebtedness, the Liens securing
such Indebtedness, if any, shall be subordinated to the Liens securing the Secured Obligations
on a junior silent basis in a manner satisfactory to the Administrative Agent
(provided that the terms of the Intercreditor Agreement as it relates to subordination
are hereby acknowledged as satisfactory) (and the holders of such Indebtedness shall not have
any rights with respect to exercising remedies pursuant to such Liens) and such Liens shall only
be on assets that constitute Collateral, (viii) in the case of any such secured Indebtedness,
the security agreements relating to such Indebtedness (together with the Intercreditor
Agreement) reflect the Junior Lien nature of the security interests and are otherwise
substantially the same as the applicable Pari Passu Loan Documents (with differences as are
reasonably satisfactory to the Administrative Agent), (ix) in the case of any such secured
Indebtedness, such Indebtedness and the holders thereof or the Senior Representative thereunder
shall be subject to the Intercreditor Agreement and the Liens securing such Indebtedness shall
be subject to the Intercreditor Agreement and (x) after giving effect to the incurrence of such
Indebtedness and to the consummation of any Permitted Acquisition or other Investment or
application of funds made with the proceeds of such incurrence on a Pro Forma Basis (Leverage),
the Total Net Leverage Ratio at such date shall not be greater than 4.0 to 1.0 (provided that in
calculating the Total Net Leverage Ratio, the proceeds of such Indebtedness shall be excluded
from Unrestricted Cash); provided, further that delivery to the Administrative
Agent at least five Business Days prior to the incurrence of such Indebtedness
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of an Officers
Certificate of a Responsible Officer of the Administrative Borrower (together with a reasonably
detailed description of the material terms and conditions of such Indebtedness or drafts of the
documentation relating thereto) certifying that the Administrative Borrower has determined in
good faith that such terms and conditions satisfy the foregoing requirements shall be conclusive
evidence that such terms and conditions satisfy such requirement unless the Administrative Agent
notifies the Administrative Borrower within such five Business Day period that it disagrees with
such determination (including a reasonable description of the basis upon which it disagrees);
(m) Indebtedness consisting of working capital facilities, lines of credit or cash
management arrangements for Excluded Subsidiaries and Contingent Obligations of Excluded
Subsidiaries in respect thereof; provided that the sum of (x) the aggregate outstanding
principal amount of the Indebtedness of all Securitization Entities under all Qualified
Securitization Transactions incurred in compliance with Section 6.01(e), plus
(y) the aggregate amount of Indebtedness then outstanding under this Section 6.01(m),
plus (z) the aggregate book value at the time of determination of the then outstanding
Receivables subject to a Permitted Factoring Facility at such time, shall not exceed
$400,000,000 at any time outstanding;
(n) Indebtedness in respect of indemnification obligations or obligations in respect of
purchase price adjustments or similar obligations incurred or assumed by the Loan Parties and
their Subsidiaries in connection with (i) an Asset Sale or sale of Equity Interests otherwise
permitted under this Agreement and (ii) Permitted Acquisitions or other Investments permitted
under Section 6.04;
(o) unsecured guaranties in the ordinary course of business of any person of the
obligations of suppliers, customers, lessors or licensees;
(p) Indebtedness of NKL arising under letters of credit issued in the ordinary course of
business;
(q) (i) Indebtedness of any person existing at the time such person is acquired in
connection with a Permitted Acquisition or any other Investment permitted under Section
6.04; provided that such Indebtedness is not incurred in connection with or in
contemplation of such Permitted Acquisition or other Investment and is not secured by Accounts
or Inventory of any Company organized in a Principal Jurisdiction or the proceeds thereof, and
at the time of such Permitted Acquisition or other Investment, no Event of Default shall have
occurred and be continuing, and (ii) Permitted Refinancings of such Indebtedness in an aggregate
amount, for all such Indebtedness permitted under this clause (q), not to exceed $100,000,000 at
any time outstanding;
(r) Indebtedness in respect of treasury, depositary and cash management services or
automated clearinghouse transfer of funds (including the Cash Pooling Arrangements and other
pooled account arrangements and netting arrangements) in the ordinary course of business, in
each case, arising under the terms of customary agreements with any bank (other than Bank
Product Agreements with Secured Bank Product Providers) at which such
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Restricted Subsidiary
maintains an overdraft, pooled account or other similar facility or arrangement;
(s) Permitted Holdings Indebtedness;
(t) Indebtedness constituting the New Senior Notes in an aggregate principal amount not to
exceed $2,500,000,000, and Permitted Refinancings thereof;
(u) (u) Indebtedness of the Parent Borrower or Novelis Corporation under one or more series
of senior secured notes under one or more indentures, provided that (i) such
Indebtedness has a final maturity date that is no earlier than 180 days after the Maturity Date,
(ii) such Indebtedness has a Weighted Average Life to Maturity that is no earlier than 180 days
after the Maturity Date, (iii) no Default is then continuing or would result therefrom, (iv)
such Indebtedness is incurred by the Parent Borrower or Novelis Corporation and the persons that
are (or are required to be) obligors under such Indebtedness do not consist of any persons other
than those persons that are (or are required to be) Loan Parties, (v) the terms of such
Indebtedness do not require any amortization, mandatory prepayment or redemption or repurchase
at the option of the holder thereof (other than customary asset sale or change of control
provisions, which asset sale provisions may require the application of proceeds of asset sales
and casualty events co-extensive with those set forth in Section 2.10(c) or (e),
as applicable, to make mandatory prepayments or prepayment offers out of such proceeds on a pari
passu basis with the Secured Obligations, all Permitted First Priority Refinancing Debt and all
other Additional Senior Secured Indebtedness) earlier than the Maturity Date, (vi) such
Indebtedness has terms and conditions (excluding pricing and premiums) that, when taken as a
whole, are not materially more restrictive or less favorable to the Companies and the Lenders
than the terms of the Term Loan Documents (or, if the Term Loan Documents are no longer in
effect, than the Term Loan Documents as in effect immediately prior to their termination)
(except with respect to terms and conditions that are applicable only after the Maturity Date),
(vii) the Liens securing such Indebtedness shall be pari passu with the Liens securing the Pari
Passu Secured Obligations (other than with respect to control of remedies), such Liens shall
only be on assets that constitute Collateral and, to the extent such Liens attach to Revolving
Credit Priority Collateral, such Liens on Revolving Credit Priority Collateral shall be junior
to the Liens securing the Secured Obligations hereunder, (viii) the security agreements relating
to such Indebtedness shall be substantially the same as the Security Documents (with such
differences as are reasonably satisfactory to the Administrative Agent), (ix) such Indebtedness
and the holders thereof or the Senior Representative thereunder shall be subject to the
Intercreditor Agreement and the Liens securing such Indebtedness shall be subject to the
Intercreditor Agreement, (x) after giving effect to the incurrence of such Indebtedness and to
the consummation of any Permitted Acquisition or other Investment or application of funds made
with the proceeds of such incurrence on a Pro Forma Basis, the Senior Secured Net Leverage Ratio
at such date shall not be greater than 2.5 to 1.0 (provided that in calculating the Senior
Secured Net Leverage Ratio, the proceeds of the incurrence of such Indebtedness shall be
excluded from Unrestricted Cash) and (xi) immediately after giving effect to the incurrence of
such Indebtedness, the Total Net Leverage Ratio, calculated on a Pro Forma Basis (Leverage),
shall not be greater than 4.75 to 1.0 as of the last day of the most-recently ended Test Period
for which financial statements have been delivered under Section 5.01(a) or (b)
as though
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such Indebtedness had been outstanding as of the last day of such Test Period
(provided that in calculating the Total Net Leverage Ratio, the proceeds of such Indebtedness
shall be excluded from Unrestricted Cash); provided, further that delivery to
the Administrative Agent at least five Business Days prior to the incurrence of such
Indebtedness of an Officers Certificate of a Responsible Officer of the Administrative Borrower
(together with a reasonably detailed description of the material terms and conditions of such
Indebtedness or drafts of the documentation relating thereto) certifying that the Administrative
Borrower has determined in good faith that such terms and conditions satisfy the foregoing
requirements shall be conclusive evidence that such terms and conditions satisfy such
requirement unless the Administrative Agent notifies the Administrative Borrower within such
five Business Day period that it disagrees with such determination (including a reasonable
description of the basis upon which it disagrees);
(v) Permitted Unsecured Refinancing Debt, and any Permitted Refinancing thereof;
(w) Permitted First Priority Refinancing Debt and Permitted Second Priority Refinancing
Debt, and any Permitted Refinancings thereof;
(x) obligations of the Parent Borrower or any of its Restricted Subsidiaries to reimburse
or refund deposits posted by customers pursuant to forward sale agreements entered into by the
Parent Borrower or such Restricted Subsidiary in the ordinary course of business;
(y) unsecured Indebtedness not otherwise permitted under this Section 6.01 in an
aggregate principal amount not to exceed $250,000,000 at any time outstanding;
(z) (i) unsecured Indebtedness in respect of obligations of the Parent Borrower or any
Restricted Subsidiary 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 in the
ordinary course of business and not in connection with the borrowing of money or any Hedge
Agreements and (ii) unsecured indebtedness in respect of intercompany obligations of the Parent
Borrower or any Restricted Subsidiary in respect of accounts payable incurred in connection with
goods sold or services rendered in the ordinary course of business and not in connection with
the borrowing of money;
(aa) Indebtedness representing deferred compensation or similar arrangements to employees,
consultants or independent contractors of the Parent Borrower (or its direct or indirect parent)
and its Restricted Subsidiaries incurred in the ordinary course of business or otherwise
incurred in connection with the Transactions or any Permitted Acquisition or other Investment
permitted under Section 6.04; and
(bb) Indebtedness consisting of promissory notes issued to current or former officers,
managers, consultants, directors and employees (or respective spouses, former spouses,
successors, executors, administrators, heirs, legatees or distributees) to finance the
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purchase
or redemption of capital stock of the Parent Borrower or any of its direct or indirect parent
companies permitted by Section 6.08(i).
SECTION 6.02 Liens. Create, incur, assume or permit to exist, directly or indirectly, any Lien on any
property now owned or hereafter acquired by it or on any income or revenues or rights in respect of
any thereof, except the following (collectively, the Permitted Liens):
(a) (i) inchoate Liens for Taxes not yet due and payable or delinquent and (ii) Liens for
Taxes which are due and payable and are being contested in good faith by appropriate proceedings
diligently conducted and for which adequate reserves have been provided on the books of the
appropriate Company in accordance with U.S. GAAP;
(b) Liens in respect of property of any Company imposed by Applicable Law, which were
incurred in the ordinary course of business and do not secure Indebtedness for borrowed money,
such as carriers, warehousemens, materialmens, landlords, workmens, suppliers, repairmens
and mechanics Liens and other similar Liens arising in the ordinary course of business, and (i)
which do not in the aggregate materially detract from the value of the property of the
Companies, taken as a whole, and do not materially impair the use thereof in the operation of
the business of the Companies, taken as a whole, and (ii) which, if they secure obligations that
are then due and unpaid for more than 30 days, are being contested in good faith by appropriate
proceedings diligently conducted and for which adequate reserves have been provided on the books
of the appropriate Company in accordance with U.S. GAAP;
(c) any Lien in existence on the Closing Date and set forth on Schedule 6.02(c) that does
not attach to the Accounts and Inventory of any Borrower or Borrowing Base Guarantor and any
Lien granted as a replacement, renewal or substitution therefor; provided that any such
replacement, renewal or substitute Lien (i) does not secure an aggregate amount of Indebtedness,
if any, greater than that secured on the Closing Date (including undrawn commitments thereunder
in effect on the Closing Date, accrued and unpaid interest thereon and fees and premiums payable
in connection with a Permitted Refinancing of the Indebtedness secured by such Lien) and (ii)
does not encumber any property other than the property subject thereto on the Closing Date (any
such Lien, an Existing Lien);
(d) easements, rights-of-way, restrictions (including zoning restrictions), reservations
(including pursuant to any original grant of any Real Property from the applicable Governmental
Authority), covenants, licenses, encroachments, protrusions and other similar charges or
encumbrances, and minor title deficiencies or irregularities on or with respect to any Real
Property, in each case whether now or hereafter in existence, not (i) securing Indebtedness for
borrowed money or (ii) individually or in the aggregate materially interfering with the ordinary
conduct of the business of the Companies at such Real Property;
(e) Liens arising out of judgments, attachments or awards not resulting in an Event of
Default that are being contested in good faith by appropriate proceedings diligently conducted
and for which adequate reserves have been provided on the books of the appropriate Company in
accordance with U.S. GAAP;
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(f) Liens (other than any Lien imposed by ERISA) (x) imposed by Applicable Law or deposits
made in connection therewith in the ordinary course of business in connection with workers
compensation, unemployment insurance and other types of social security legislation, (y)
incurred in the ordinary course of business to secure the performance of tenders, statutory
obligations (other than excise taxes), surety, stay, customs and appeal bonds, statutory 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 (z)
arising by virtue of deposits made in the ordinary course of business to secure liability for
premiums to insurance carriers; provided that (i) with respect to clauses (x), (y) and (z) of
this paragraph (f), such Liens are for amounts not yet due and payable or delinquent or, to the
extent such amounts are so due and payable, such amounts are being contested in good faith by
appropriate proceedings diligently conducted and for which adequate reserves have been
established on the books of the appropriate Company in accordance with U.S. GAAP, and (ii) to
the extent such Liens are not imposed by Applicable Law, such Liens shall in no event encumber
any property other than cash and Cash Equivalents and, with respect to clause (y), property
relating to the performance of obligations secured by such bonds or instruments;
(g) (i) Leases, subleases or licenses of the properties of any Company (other than Accounts
and Inventory) granted to other persons which do not, individually or in the aggregate,
interfere in any material respect with the ordinary conduct of the business of any Company and
(ii) interests or title of a lessor, sublessor, licensor or sublicensor or Lien securing a
lessors, sublessors, licensors or sublicensors interest in any lease or license not
prohibited by this Agreement;
(h) Liens arising out of conditional sale, hire purchase, title retention, consignment or
similar arrangements for the sale of goods entered into by any Company in the ordinary course of
business and which do not attach to Accounts or Inventory that is included in the calculation of
the Borrowing Base, except to the extent explicitly permitted by the definition of Eligible
Accounts or Eligible Inventory, as applicable;
(i) Liens securing Indebtedness incurred pursuant to Section 6.01(f) or Section
6.01(g); provided that any such Liens do not attach to Accounts or Inventory and attach only
to the property being financed pursuant to such Indebtedness and any proceeds of such property
and do not encumber any other property of any Company;
(j) bankers Liens, rights of setoff and other similar Liens existing solely with respect
to cash and Cash Equivalents on deposit in one or more accounts maintained by any Company, in
each case granted in the ordinary course of business in favor of the bank or banks with which
such accounts are maintained, securing amounts owing to such bank with respect to treasury,
depositary and cash management services or automated clearinghouse transfer of funds (including
pooled account arrangements and netting arrangements or claims against any clearing agent or
custodian with respect thereto); provided that, unless such Liens are non-consensual and arise
by operation of law, in no case shall any such Liens secure (either directly or indirectly) the
repayment of any other Indebtedness;
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(k) (i) Liens granted pursuant to the Loan Documents to secure the Secured Obligations,
(ii) pursuant to the Pari Passu Loan Documents to secure the Pari Passu Secured Obligations and
any Permitted Refinancings thereof, (iii) Liens securing Permitted First Priority Refinancing
Debt and Permitted Second Priority Refinancing Debt, (iv) Liens securing Additional Senior
Secured Indebtedness that are pari passu with the Liens securing the Pari Passu Secured
Obligations and subject to the terms of the Intercreditor Agreement and, to the extent such
Liens attach to Revolving Credit Priority Collateral, such Liens shall be junior to the Liens
securing the Secured Obligations, and (v) Liens securing Junior Secured Indebtedness that are
subordinated to the Liens granted under the Security Documents or otherwise securing the Secured
Obligations and subject to the terms of the Intercreditor Agreement;
(l) licenses of Intellectual Property granted by any Company in the ordinary course of
business and not interfering in any material respect with the ordinary conduct of business of
the Companies;
(m) the filing of UCC or PPSA financing statements (or the equivalent in other
jurisdictions) solely as a precautionary measure in connection with operating leases or
consignment of goods;
(n) Liens on property of Excluded Subsidiaries securing Indebtedness of Excluded
Subsidiaries permitted by Section 6.01(m) and (p);
(o) Liens securing the refinancing of any Indebtedness secured by any Lien permitted by
clauses (c), (i), (k) or (r) of this Section 6.02 or this clause (o) without any change
in the assets subject to such Lien and to the extent such refinanced Indebtedness is permitted
by Section 6.01;
(p) to the extent constituting a Lien, the existence of the equal and ratable clause in
the New Senior Note Documents (and any Permitted Refinancings thereof) (but not any security
interests granted pursuant thereto);
(q) 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 in the ordinary course of
business;
(r) Liens on assets acquired in a Permitted Acquisition or on property of a person (in each
case, other than Accounts or Inventory owned by a Company organized or doing business in a
Principal Jurisdiction) existing at the time such person is acquired or merged with or into or
amalgamated or consolidated with any Company to the extent permitted hereunder or such assets
are acquired (and not created in anticipation or contemplation thereof); provided that
(i) such Liens do not extend to property not subject to such Liens at the time of acquisition
(other than improvements thereon and proceeds thereof) and are no more favorable to the
lienholders than such existing Lien and (ii) the aggregate principal amount of Indebtedness
secured by such Liens does not exceed $100,000,000 at any time outstanding;
(s) any encumbrance or restriction (including put and call agreements) solely in respect of
the Equity Interests of any Joint Venture or Joint Venture Subsidiary that is not a
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Loan Party,
contained in such Joint Ventures or Joint Venture Subsidiarys Organizational Documents or the
joint venture agreement or stockholders agreement in respect of such Joint Venture or Joint
Venture Subsidiary;
(t) Liens granted in connection with Indebtedness permitted under Section 6.01(e)
that are limited in each case to the Securitization Assets transferred or assigned pursuant to
the related Qualified Securitization Transaction;
(u) Liens not otherwise permitted by this Section 6.02 (but excluding however any
consensual Lien on any Revolving Credit Priority Collateral other than that of Excluded
Subsidiaries) securing liabilities not in excess of $50,000,000 in the aggregate at any time
outstanding;
(v) to the extent constituting Liens, rights under purchase and sale agreements with
respect to Equity Interests or other assets permitted to be sold in Asset Sales permitted under
Section 6.06;
(w) Liens securing obligations owing to the Loan Parties so long as such obligations and
Liens, where owing by or on assets of Loan Parties, are subordinated to the Secured Obligations
and to the Secured Parties Liens on the Collateral in a manner satisfactory to the
Administrative Agent;
(x) Liens created, arising or securing obligations under the Receivables Purchase
Agreements;
(y) Liens on deposits provided by customers in favor of such customers securing the
obligations of the Parent Borrower or its Restricted Subsidiaries to refund deposits posted by
customers pursuant to forward sale agreements entered into by the Parent Borrower or its
Restricted Subsidiaries in the ordinary course of business;
(z) Liens on cash advances in favor of the seller of any property to be acquired in an
Investment permitted pursuant to Section 6.04 to be applied against the purchase price
for such Investment;
(aa) Liens pursuant to the Forward Share Sale Agreement; and
(bb) Liens in favor of any underwriter, depositary or stock exchange on the Equity
Interests in NKL or its direct parents, 4260848 Canada Inc. and 4260856 Canada Inc., and any
securities accounts in which such Equity Interests are held in connection with any listing or
offering of Equity Interests in NKL, to the extent required by Applicable Law or stock exchange
requirements (and not securing Indebtedness);
provided, however, that notwithstanding any of the foregoing, no consensual Liens
(other than Liens permitted under clauses (s) and (v) above, in the case of Securities Collateral,
and clause (h) above (to the extent permitted thereby), in the case of Accounts or Inventory) shall
be permitted to exist, directly or indirectly, on any Securities Collateral or any Accounts or
Inventory of any Borrower, Borrowing Base Guarantor or other Company organized or conducting
business in, or having assets located in, a Principal Jurisdiction, other than Liens granted
pursuant to the
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Security Documents or the Pari Passu Security Documents or any agreement, document
or instrument pursuant to which any Lien is granted securing any Additional Secured Indebtedness,
Permitted First Priority Refinancing Debt, Permitted Second Priority Refinancing Debt or Junior
Secured Indebtedness.
Any reference in this Agreement or any of the other Loan Documents to a Lien permitted by this
Agreement is not intended to subordinate or postpone, and shall not be interpreted as subordinating
or postponing, or as an agreement to subordinate or postpone, any Lien created by any of the Loan
Documents to any Lien permitted hereunder.
SECTION 6.03 Sale and Leaseback Transactions. Enter into any arrangement, directly or indirectly, with
any person whereby it shall sell or transfer any property, real or personal, used or useful in its
business, whether now owned or hereafter acquired, and thereafter rent or lease such property or
other property which it intends to use for substantially the same purpose or purposes as the
property being sold or transferred (a Sale and Leaseback Transaction) unless (i) the sale of such
property is permitted by Section 6.06, (ii) any Liens arising in connection with its use of
such property are permitted by Section 6.02 and (iii) after giving effect to such Sale and
Leaseback Transaction, the aggregate fair market value of all properties covered by Sale and
Leaseback Transactions entered into would not exceed $250,000,000.
SECTION 6.04 Investments, Loan and Advances. Directly or indirectly, lend money or credit (by way of
guarantee or otherwise) or make advances to, any person, or purchase or acquire any stock, bonds,
notes, debentures or other obligations or securities of, or any other ownership interest in, or
make any capital contribution to, any other person, or purchase or otherwise acquire (in one
transaction or a series of transactions) all or substantially all of the property and assets or
business of any other person or assets constituting a business unit, line of business or division
of any other person, or purchase or own a futures contract or otherwise become liable for the
purchase or sale of currency or other commodities at a future date in the nature of a futures
contract (all of the foregoing, collectively, Investments; it being understood that (x) the
amount of any Investment shall be the amount actually invested, without adjustment for subsequent
increases or decreases in the value of such Investment and when determining the amount of an
Investment that remains outstanding, the last paragraph of this Section 6.04 shall apply,
(y) in the event a Restricted Subsidiary ceases to be a Restricted Subsidiary as a result of being
designated an Unrestricted Subsidiary, the Parent Borrower will be deemed to have made an
Investment in such Unrestricted Subsidiary as of the date of such designation, as provided in
Section 5.17 and (z) in the event a Restricted Subsidiary ceases to be a Restricted
Subsidiary as a result of an Asset Sale or similar transaction, and the Parent Borrower and its
Restricted Subsidiaries continue to own Equity Interests in such Restricted Subsidiary, the Parent
Borrower will be deemed, at the time of such transaction and after giving effect thereto, to have
made an Investment in such Person equal to the fair market value of the Parent Borrowers and its
Restricted Subsidiaries Investments in such Person at such time), except that the following shall
be permitted:
(a) Investments consisting of unsecured guaranties by Loan Parties of, or other unsecured
Contingent Obligations with respect to, operating payments not constituting Indebtedness for
borrowed money incurred by Restricted Subsidiaries that are not Loan Parties or that are
Restricted Grantors, in the ordinary course of business, that, to the extent
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paid by such Loan
Party, shall not exceed an aggregate amount equal to $75,000,000 less the amount of
Contingent Obligations by Loan Parties in respect of Companies that are not Loan Parties or that
are Restricted Grantors permitted pursuant to Section 6.01(i)(ii);
(b) Investments outstanding on the Closing Date and identified on Schedule 6.04(b);
(c) the Companies may (i) acquire and hold accounts receivable owing to any of them if
created or acquired in the ordinary course of business or in connection with a Permitted
Acquisition, (ii) invest in, acquire and hold cash and Cash Equivalents, (iii) endorse
negotiable instruments held for collection in the ordinary course of business or (iv) make
lease, utility and other similar deposits in the ordinary course of business;
(d) Investments of Securitization Assets in Securitization Entities in connection with
Qualified Securitization Transactions permitted by Section 6.01(e);
(e) the Loan Parties and their Restricted Subsidiaries may make loans and advances
(including payroll, travel and entertainment related advances) in the ordinary course of
business to their respective employees (other than any loans or advances to any director or
executive officer (or equivalent thereof) that would be in violation of Section 402 of the
Sarbanes-Oxley Act) so long as the aggregate principal amount thereof at any time outstanding
(determined without regard to any write-downs or write-offs of such loans and advances) shall
not exceed (when aggregated with loans and advances outstanding pursuant to clause (h) below)
$15,000,000;
(f) any Company may enter into Hedging Agreements (including Contingent Obligations of any
Company with respect to Hedging Obligations of any other Company) to the extent permitted by
Section 6.01(c);
(g) (g) Investments made by any Company as a result of consideration received in connection
with an Asset Sale made in compliance with Section 6.06;
(h) loans and advances to directors, employees and officers of the Loan Parties and their
Restricted Subsidiaries for bona fide business purposes, in aggregate amount not to exceed (when
aggregated with loans and advances outstanding pursuant to clause (e) above) $15,000,000 at any
time outstanding; provided that no loans in violation of Section 402 of the
Sarbanes-Oxley Act shall be permitted hereunder;
(i) Investments (i) by any Company in any other Company outstanding on the Closing Date,
(ii) by any Company in any Unrestricted Grantor, (iii) by any Restricted Grantor in any other
Restricted Grantor, (iv) by an Unrestricted Grantor in any Restricted Grantor up to an aggregate
amount made after the Closing Date of $75,000,000 in the aggregate at any one time outstanding
made in reliance on this clause (i)(iv), and (v) by any Company that is not a Loan Party in any
other Company;
(j) Investments in securities or other obligations received upon foreclosure or pursuant to
any plan of reorganization or liquidation or similar arrangement upon the bankruptcy or
insolvency of trade creditors or customers or in connection with the settlement
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of delinquent
accounts in the ordinary course of business, and Investments received in good faith in
settlement of disputes or litigation;
(k) Investments in Joint Ventures in which the Loan Parties hold at least 50% of the
outstanding Equity Interests or Joint Venture Subsidiaries made with the Net Cash Proceeds of
Asset Sales made in accordance with Section 6.06(k);
(l) Investments in Norf GmbH for purposes of making Capital Expenditures in an aggregate
amount not to exceed $20,000,000 during any Fiscal Year;
(m) Permitted Acquisitions;
(n) so long as the Availability Conditions are satisfied at the time of consummation of the
Investment and payment of the consideration therefor, Investments not otherwise permitted
hereby, including other Investments in any Subsidiary of any Loan Party;
(o) Mergers, amalgamations and consolidations in compliance with Section 6.05;
provided that the Lien on and security interest in such Investment granted or to be
granted in favor of the Collateral Agent under the Security Documents shall be maintained or
created in accordance with the provisions of Section 5.11 or Section 5.12, as
applicable;
(p) Investments in respect of Cash Pooling Arrangements, subject to the limitations set
forth in Section 6.07;
(q) Investments consisting of guarantees of Indebtedness referred to in clauses (i) (to the
extent such guarantee is in effect on the Closing Date or permitted as part of a Permitted
Refinancing), (ii), (iii) and (iv) of Section 6.01(b) and Contingent Obligations
permitted by Section 6.01(c) or (i);
(r) other Investments in an aggregate amount not to exceed $50,000,000 at any time
outstanding;
(s) Investments by any Company in any other Company; provided that such Investment
is part of a Series of Cash Neutral Transactions and no Default has occurred and is continuing;
(t) contribution of promissory notes with face amounts of 293,834,842 and 87,291,599
outstanding on the Closing Date by the Parent Borrower to a newly formed Loan Party under the
laws of Luxembourg;
provided that any such Investment in the form of a loan or advance to any Loan Party (other
than the Forward Share Sale Agreement) shall be subordinated to the Secured Obligations on terms
reasonably satisfactory to the Administrative Agent and, in the case of a loan or advance by a Loan
Party, evidenced by an Intercompany Note and pledged by such Loan Party as Collateral pursuant to
the Security Documents.
An Investment shall be deemed to be outstanding to the extent not returned in the same form as the
original Investment to any Company. The outstanding amount of an Investment shall, in the
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(1) case of
a Contingent Obligation that has been terminated, be reduced to the extent no payment is or was
made with respect to such Contingent Obligation upon or prior to the termination of such Contingent
Obligation; and the outstanding amount of other Investments shall be reduced by the amount of cash
or Cash Equivalents received with respect to such Investment upon the sale or disposition thereof,
or constituting a return of capital with respect thereto or, repayment of the principal amount
thereof, in the case of a loan or advance. No property acquired by any Borrower or Borrowing Base
Guarantor in connection with any Investment permitted under this Section 6.04 shall be
permitted to be included in the Borrowing Base until the Collateral Agent has received and
approved, in the Administrative Agents Permitted Discretion, (A) a collateral audit with respect
to such property, conducted by an independent appraisal firm reasonably acceptable to
Administrative Agent, (B) all UCC or other search results necessary to confirm the Collateral
Agents Lien on all of such property of such Borrowing Base Guarantor, which Lien is a First
Priority Lien with regard to any Revolving Credit Priority Collateral, and (C) such customary
certificates (including a solvency certificate), resolutions, financial statements, legal opinions,
and other documentation as the Administrative Agent may reasonably request (including as required
by Sections 5.11 and 5.12).
SECTION 6.05 Mergers, Amalgamations and Consolidations. Wind up, liquidate or dissolve its affairs or
enter into any transaction of merger, amalgamation or consolidation (or agree to do any of the
foregoing at any future time), except that the following shall be permitted:
(a) Asset Sales in compliance with Section 6.06;
(b) Permitted Acquisitions in compliance with Section 6.04;
(c) (i) any Company may merge, amalgamate or consolidate with or into any Unrestricted
Grantor (provided that (A) in the case of any merger, amalgamation or consolidation
involving a Borrower, a Borrower is the surviving or resulting person, and in any other case, an
Unrestricted Grantor is the surviving or resulting person, (B) no Borrower (other than a U.S.
Borrower, so long as there always exists at least one U.S. Borrower) shall merge, amalgamate or
consolidate with or into any other Borrower, (C) in the case of any merger, amalgamation or
consolidation involving Parent Borrower, the surviving or resulting Borrower is organized under
the laws of Canada and (D) in the case of any merger or consolidation involving a U.S. Borrower,
the surviving Borrower is organized under the laws of the United States (or any state thereof or
the District of Columbia), (ii) any Restricted Grantor may merge, amalgamate or consolidate with
or into any other Restricted Grantor (provided that (A) in the case of any merger,
amalgamation or consolidation involving a Borrower, a Borrower is the surviving or resulting
person, and in any other case, a Subsidiary Guarantor is the surviving or resulting person and
(B) except as expressly provided in clause (i) above with respect to U.S. Borrowers, no Borrower
shall merge, amalgamate or consolidate with or into any other Borrower), (iii) Novelis Aluminum
Holding Company and Novelis Deutschland GmbH may merge, provided Novelis Deutschland GmbH is the
surviving or resulting person, and (iv) any Company that is not a Loan Party may merge,
amalgamate or consolidate with or into any Restricted Grantor (provided that a Borrower
is the surviving or resulting person in the case of any merger, amalgamation or consolidation
involving a Borrower, and in any other case, a Subsidiary Guarantor is the surviving or
resulting person); provided that, in the case of each of the foregoing clauses (i)
through (iv),
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the surviving or resulting person is a Wholly Owned Subsidiary of Holdings
(provided that following a Qualified Parent Borrower IPO, the surviving or resulting
person is the Parent Borrower or a Wholly Owned Subsidiary of Parent Borrower), (2) the Lien on
and security interest in such property granted or to be granted in favor of the Collateral Agent
under the Security Documents shall be maintained in full force and effect and perfected and
enforceable (to at least the same extent as in effect immediately prior to such transfer) or
created in accordance with the provisions of Section 5.11 or Section 5.12, as
applicable and (3) no Default is then continuing or would result therefrom; provided
that in the case of any amalgamation or consolidation involving a Loan Party, at the request of
the Administrative Agent, such Loan Party and each other Loan Party shall confirm its respective
Secured Obligations and Liens under the Loan Documents in a manner reasonably satisfactory to
the Administrative Agent;
(d) any Restricted Subsidiary that is not a Loan Party may merge, amalgamate or consolidate
with or into any other Restricted Subsidiary that is not a Loan Party;
(e) Holdings and the Parent Borrower may consummate the Permitted Holdings Amalgamation;
(f) any Restricted Subsidiary of the Parent Borrower (other than Novelis Corporation or a
Receivables Seller) may dissolve, liquidate or wind up its affairs at any time (so long as, (i)
in the case of a Borrower, all of its assets are distributed or otherwise transferred to a
surviving Borrower organized in the same jurisdiction and (ii) in the case of a Borrowing Base
Guarantor, all of its assets are distributed or otherwise transferred to a surviving Borrower or
Borrowing Base Guarantor organized in the same jurisdiction); provided that such
dissolution, liquidation or winding up, as applicable, could not reasonably be expected to have
a Material Adverse Effect; and
(g) (i) any Unrestricted Grantor (other than Holdings, the Parent Borrower, Novelis
Corporation or a Receivables Seller) may dissolve, liquidate or wind-up its affairs
(collectively, Wind-Up), so long as all of its assets are distributed or otherwise transferred
to any other Unrestricted Grantor (and so long as, (A) in the case of a Borrower, all of its
assets are distributed or otherwise transferred to a surviving Borrower organized in the same
jurisdiction and (B) in the case of a Borrowing Base Guarantor, all of its assets are
distributed or otherwise transferred to a surviving Borrower or Borrowing Base Guarantor
organized in the same jurisdiction); and (ii) any Restricted Grantor (other than a Receivables
Seller) may Wind-Up so long as all of its assets are distributed or otherwise transferred to any
other Restricted Grantor (so long as, (A) in the case of a Borrower, all of its assets are
distributed or otherwise transferred to a surviving Borrower organized in the same jurisdiction
and (B) in the case of a Borrowing Base Guarantor, all of its assets are distributed or
otherwise transferred to a surviving Borrower or Borrowing Base Guarantor organized in the same
jurisdiction); provided that, in each case, (1) the Lien on and security interest in
such property granted or to be granted in favor of the Collateral Agent under the Security
Documents shall be maintained in full force and effect and perfected and enforceable (to at
least the same extent as in effect immediately prior to such transfer) or created in accordance
with the provisions of Section 5.11 or Section 5.12, as applicable and (2) no
Default is then continuing or would result therefrom;
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provided that for purposes of clauses (f) and (g), the United States, any state thereof and
the District of Columbia shall be treated as the same jurisdiction.
SECTION 6.06 Asset Sales. Effect any Asset Sale except that the following shall be permitted:
(a) disposition of used, worn out, obsolete or surplus property by any Company in the
ordinary course of business and the abandonment or other disposition of Intellectual Property
that is, in the reasonable judgment of Parent Borrower, no longer economically practicable to
maintain or useful in the conduct of the business of the Companies taken as a whole;
(b) so long as no Default is then continuing or would result therefrom, any other Asset
Sale (other than the Equity Interests of (y) any Wholly Owned Subsidiary that is a Restricted
Subsidiary unless, after giving effect to any such Asset Sale, such person either ceases to be a
Restricted Subsidiary or, in the case of an Excluded Collateral Subsidiary, becomes a Joint
Venture Subsidiary or (z) a Borrower) for fair market value, with at least 75% of the
consideration received for all such Asset Sales or related Asset Sales in which the
consideration received exceeds $10,000,000 payable in cash upon such sale (provided,
however, that for the purposes of this clause (b), the following shall be deemed to be
cash: (i) any liabilities (as shown on the applicable Borrowers most recent balance sheet
provided hereunder or in the footnotes thereto) of the applicable Borrower or applicable
Restricted Subsidiary, other than liabilities that are by their terms subordinated to the
payment in cash of the Obligations, that are assumed by the transferee with respect to the
applicable Asset Sale and for which Holdings, such Borrower and all of its Restricted
Subsidiaries shall have been validly released by all applicable creditors in writing, (ii) any
securities received by the applicable Borrower or the applicable Restricted Subsidiary from such
transferee that are converted by such Borrower or such Restricted Subsidiary into cash (to the
extent of the cash received) within 180 days following the closing of the applicable Asset Sale,
and (iii) aggregate non-cash consideration received by the applicable Borrower or the applicable
Restricted Subsidiary having an aggregate fair market value (determined as of the closing of the
applicable Asset Sale for which such non-cash consideration is received) not to exceed
$50,000,000 at any time (net of any non-cash consideration converted into cash));
provided, however, that with respect to any such Asset Sale pursuant to this
clause (b), the aggregate consideration received for all such Asset Sales shall not exceed
$400,000,000 during any fiscal year or $800,000,000 in the aggregate after the Closing Date;
provided further, however, that, in the case of a sale of Equity
Interests of a Borrowing Base Guarantor or Receivables Seller, the Administrative Borrower shall
deliver an updated Borrowing Base Certificate at the time of, and giving effect to, such sale,
and shall make such mandatory prepayments as may be required (including pursuant to Section
2.10(b)(ix) and (xi), as applicable) in connection therewith;
(c) leases, subleases or licenses of the properties of any Company in the ordinary course
of business and which do not, individually or in the aggregate, interfere in any material
respect with the ordinary conduct of the business of any Company;
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(d) mergers and consolidations, and liquidations and dissolutions in compliance with
Section 6.05;
(e) sales, transfers and other dispositions of Receivables for the fair market value
thereof in connection with a Permitted Factoring Facility so long as at any time of
determination the aggregate book value of the then outstanding Receivables subject to a
Permitted Factoring Facility does not exceed an amount equal to $400,000,000 less the
amount of Indebtedness under all outstanding Qualified Securitization Transactions at such time
under Section 6.01(e) less the amount of Indebtedness outstanding under
Section 6.01(m) at such time;
(f) the sale or disposition of cash and Cash Equivalents in connection with a transaction
otherwise permitted under the terms of this Agreement;
(g) assignments and licenses of Intellectual Property of any Loan Party and its
Subsidiaries in the ordinary course of business and which do not, individually or in the
aggregate, interfere in any material respect with the ordinary conduct of the business of any
Company;
(h) Asset Sales (other than the Equity Interests of a Borrower, a Borrowing Base Guarantor
or a Receivables Seller) (i) by any Unrestricted Grantor to any other Unrestricted Grantor
(other than Holdings), (ii) by any Restricted Grantor to any other Restricted Grantor, (iii) by
any Restricted Grantor to any Unrestricted Grantor (other than Holdings) so long as the
consideration paid by the Unrestricted Grantor in such Asset Sale does not exceed the fair
market value of the property transferred, (iv) by (x) any Unrestricted Grantor to any Restricted
Grantor for fair market value and (y) by any Loan Party to any Restricted Subsidiary that is not
a Loan Party for fair market value provided that the fair market value of such Asset Sales under
this clause (iv) does not exceed $100,000,000 in the aggregate for all such Asset Sales since
the Closing Date, (v) by any Company that is not a Loan Party to any Loan Party so long as the
consideration paid by the Loan Party in such Asset Sale does not exceed the fair market value of
the property transferred, and (vi) by and among Companies that are not Loan Parties;
provided that (A) in the case of any transfer from one Loan Party to another Loan Party,
any security interests granted to the Collateral Agent for the benefit of any Secured Parties
pursuant to the relevant Security Documents in the assets so transferred shall (1) remain in
full force and effect and perfected and enforceable (to at least the same extent as in effect
immediately prior to such transfer) or (2) be replaced by security interests granted to the
Collateral Agent for the benefit of the relevant Secured Parties pursuant to the relevant
Security Documents, which new security interests shall be in full force and effect and perfected
and enforceable (to at least the same extent as in effect immediately prior to such transfer)
and (B) no Default is then continuing or would result therefrom;
(i) the Companies may consummate Asset Swaps, so long as (i) each such sale is in an
arms-length transaction and the applicable Company receives at least fair market value
consideration (as determined in good faith by such Company), (ii) the Collateral Agent shall
have a First Priority perfected Lien on the assets acquired pursuant to such Asset Swap at least
to the same extent as the assets sold pursuant to such Asset Swap (immediately prior to giving
effect thereto) and (iii) the aggregate fair market value of all assets sold pursuant to
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this
clause (i) shall not exceed $50,000,000 in the aggregate since the Closing Date;
provided that so long as (y) the assets acquired by any Company pursuant to the
respective Asset Swap are located in the same country as the assets sold by such Company and (z)
such Asset Swap does not involve a transfer of Revolving Credit Priority Collateral from a Loan
Party to a Company that is not a Loan Party, such $50,000,000 aggregate cap will not apply to
such Asset Swap;
(j) sales, transfers and other dispositions of Receivables (whether now existing or arising
or acquired in the future) and Related Security to a Securitization Entity in connection with a
Qualified Securitization Transaction permitted under Section 6.01(e) and all sales,
transfers or other dispositions of Securitization Assets by a Securitization Entity under, and
pursuant to, a Qualified Securitization Transaction permitted under Section 6.01(e);
(k) so long as no Default is then continuing or would result therefrom, the arms-length
sale or disposition for cash of Equity Interests in a Joint Venture Subsidiary for fair market
value or the issuance of Equity Interests in a Joint Venture Subsidiary; provided,
however, that the aggregate fair market value of all such Equity Interests sold or
otherwise disposed of pursuant to this clause (k) following the Closing Date shall not exceed
$300,000,000;
(l) issuances of Equity Interests by Joint Venture Subsidiaries and Excluded Collateral
Subsidiaries;
(m) Asset Sales among Companies of promissory notes or preferred stock or similar
instruments issued by a Company; provided that such Asset Sales are part of a Series of Cash
Neutral Transactions and no Default has occurred and is continuing;
(n) the sale of Receivables made pursuant to a Receivables Purchase Agreement;
(o) to the extent constituting an Asset Sale, Investments permitted by Section
6.04(i);
(p) issuances of Qualified Capital Stock (including by way of sales of treasury stock) or
any options or warrants to purchase, or securities convertible into, any Qualified Capital Stock
(A) for stock splits, stock dividends and additional issuances of Qualified Capital Stock which
do not decrease the percentage ownership of the Loan Parties in any class of the Equity
Interests of such issuing Company and (B) by Subsidiaries of the Parent Borrower formed after
the Closing Date to the Parent Borrower or the Subsidiary of the Parent Borrower which is to own
such Qualified Capital Stock; provided that, subject to the Intercreditor Agreement, all
Equity Interests issued in accordance with this Section 6.06(p) shall, to the extent
required by Section 5.11 or any Security Document or if such Equity Interests are issued
by any Loan Party (other than Holdings), be delivered to the Collateral Agent;
(q) contribution of promissory notes with face amounts of 293,834,842 and 87,291,599
outstanding on the Closing Date by the Borrower to a newly formed Loan Party under the laws of
Luxembourg; and
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(r) so long as the Availability Conditions are satisfied, any other Asset Sale (other than
the Equity Interests of (y) any Wholly Owned Subsidiary that is a Restricted Subsidiary unless,
after giving effect to any such Asset Sale, such person either ceases to be a Restricted
Subsidiary or, in the case of an Excluded Collateral Subsidiary, becomes a Joint Venture
Subsidiary or (z) a Borrower) for fair market value, with at least 75% of the consideration
received for all such Asset Sales payable in cash upon such sale (provided,
however, that for the purposes of this clause (r), the following shall be deemed to be
cash: (i) any liabilities (as shown on the applicable Borrowers most recent balance sheet
provided hereunder or in the footnotes thereto) of the applicable Borrower or applicable
Restricted Subsidiary, other than liabilities that are by their terms subordinated to the
payment in cash of the Obligations, that are assumed by the transferee with respect to the
applicable Asset Sale and for which Holdings, such Borrower and all of its Restricted
Subsidiaries shall have been validly released by all applicable creditors in writing, (ii) any
securities received by the applicable Borrower or the applicable Restricted Subsidiary from such
transferee that are converted by such Borrower or such Restricted Subsidiary into cash (to the
extent of the cash received) within 180 days following the closing of the applicable Asset Sale,
and (iii) aggregate non-cash consideration received by the applicable Borrower or the applicable
Restricted Subsidiary having an aggregate fair market value (determined as of the closing of the
applicable Asset Sale for which such non-cash consideration is received) not to exceed
$50,000,000 at any time (net of any non-cash consideration converted into cash));
provided however, that, in the case of a sale of Equity Interests of a Borrowing
Base Guarantor or Receivables Seller, the Administrative Borrower shall deliver an updated
Borrowing Base Certificate at the time of, and giving effect to, such sale, and shall make such
mandatory prepayments as may be required (including pursuant to Section 2.10(b)(ix) and
(xi), as applicable) in connection therewith.
SECTION 6.07 Cash Pooling Arrangements.
Amend, vary or waive any term of the Cash Pooling Arrangements without express written consent
of the Administrative Agent, or enter into any new pooled account or netting agreement with any
Affiliate without express written consent of the Administrative Agent. Permit the aggregate amount
owed pursuant to the Cash Pooling Arrangements by all Companies who are not Loan Parties
minus the aggregate amount on deposit pursuant to the Cash Pooling Arrangements from such
Persons to exceed $50,000,000.
SECTION 6.08 Dividends. Declare or pay, directly or indirectly, any Dividends with respect to any
Company, except that the following shall be permitted:
(a) (i) Dividends by any Company to any Loan Party that is a Wholly Owned Subsidiary of
Holdings (or the Parent Borrower or a Wholly Owned Subsidiary of the Parent Borrower following a
Qualified Parent Borrower IPO), (ii) Dividends by Holdings (or the Parent Borrower following a
Qualified Parent Borrower IPO) payable solely in Qualified Capital Stock and (iii) Dividends by
Holdings payable with the proceeds of Permitted Holdings Indebtedness;
(b) (i) Dividends by any Company that is not a Loan Party to any other Company that is not
a Loan Party but is a Wholly Owned Subsidiary of Holdings (or the Parent
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Borrower or a Wholly
Owned Subsidiary of the Parent Borrower following a Qualified Parent Borrower IPO) and (ii) cash
Dividends by any Company that is not a Loan Party to the holders of its Equity Interests on a
pro rata basis;
(c) (A) to the extent actually used by Holdings to pay such franchise taxes, costs and
expenses, fees, payments by the Parent Borrower to or on behalf of Holdings in an amount
sufficient to pay franchise taxes and other fees solely required to maintain the legal existence
of Holdings, (B) payments by the Parent Borrower to or on behalf of Holdings in an amount
sufficient to pay out-of-pocket legal, accounting and filing costs and other expenses in the
nature of overhead in the ordinary course of business of Holdings, and (C) management,
consulting, monitoring and advisory fees and related expenses and termination fees pursuant to a
management agreement with one or more Specified Holders relating to the Parent Borrower
(collectively, the Management Fees), in the case of clauses (A), (B) and (C) in an aggregate
amount not to exceed in any calendar year the greater of (i) $20,000,000 and (ii) 1.5% of the
Parent Borrowers Consolidated EBITDA (Leverage) in the prior calendar year;
(d) Parent Borrower may pay cash Dividends to the holders of its Equity Interests and, if
Holdings is a holder of such Equity Interests, the proceeds thereof may be utilized by Holdings
to pay cash Dividends to the holders of its Equity Interests; provided that the
Dividends described in this clause (d) shall not be permitted if the Availability Conditions are
not satisfied on the date of payment thereof;
(e) the Closing Date Distribution;
(f) to the extent constituting a Dividend, payments permitted by Section 6.09(d)
that do not relate to Equity Interests;
(g) Dividends by any Company to any other Company that are part of a Series of Cash Neutral
Transactions; provided no Default has occurred and is continuing;
(h) following a Qualified IPO, Dividends by the Parent Borrower paid to Holdings (which may
pay the proceeds thereof to the holders of its Equity Interests) or, in the case of a Qualified
Parent Borrower IPO, its other equity holders, of up to 6% of the net cash proceeds received by
(or contributed to the capital of) the Parent Borrower in or from such Qualified IPO; and
(i) Dividends to repurchase Equity Interests of Holdings or any direct or indirect parent
entity (or following a Qualified Parent Borrower IPO, Equity Interests of the Parent Borrower)
from current or former officers, directors or employees of the Parent Borrower or any of its
Restricted Subsidiaries or any direct or indirect parent entity (or permitted transferees of
such current or former officers, directors or employees); provided, however,
that the aggregate amount of such repurchases shall not exceed (i) $10,000,000 in any calendar
year prior to completion of a Qualified IPO, or (ii) $15,000,000 in any calendar year following
completion of a Qualified IPO (with unused amounts in any calendar year being permitted to be
carried over for the next two succeeding calendar years up to a maximum of (A) $20,000,000 in
the aggregate in any calendar year prior to completion of a Qualified IPO,
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or (B) $30,000,000 in
the aggregate in any calendar year following completion of a Qualified IPO).
SECTION 6.09 Transactions with Affiliates. Enter into, directly or indirectly, any transaction or
series of related transactions, whether or not in the ordinary course of business, with or for the
benefit of any Affiliate of any Company (other than between or among Loan Parties), other than on
terms and conditions at least as favorable to such Company as would reasonably be obtained by such
Company at that time in a comparable arms-length transaction with a person other than an
Affiliate, except that the following shall be permitted:
(a) Dividends permitted by Section 6.08;
(b) Investments permitted by Section 6.04(d), (e), (h),
(i), (l), (p) or (s);
(c) mergers, amalgamations and consolidations permitted by Section 6.05(c),
(d), (e), (f) or (g), Asset Sales permitted by Section
6.06(h)(iv) and (v) or (m);
(d) reasonable and customary director, officer and employee compensation (including
bonuses) and other benefits (including retirement, health, stock option and other benefit plans)
and indemnification arrangements, in each case approved by the Board of Directors of the Parent
Borrower;
(e) transactions with customers, clients, suppliers, joint venture partners or purchasers
or sellers of goods and services, in each case in the ordinary course of business on terms not
materially less favorable as might reasonably have been obtained at such time from a Person that
is not an Affiliate of the Parent Borrower, as determined in good faith by the Parent Borrower,
and otherwise not prohibited by the Loan Documents;
(f) the existence of, and the performance by any Company of its obligations under the terms
of, any limited liability company, limited partnership or other Organizational Document or
securityholders agreement (including any registration rights agreement or purchase agreement
related thereto) to which it is a party on the Closing Date and which has been disclosed in
writing to the Administrative Agent as in effect on the Closing Date, and similar agreements
that it may enter into thereafter, to the extent not more adverse to the interests of the
Lenders in any material respect, when taken as a whole, than any of such documents and
agreements as in effect on the Closing Date;
(g) the Transactions as contemplated by the Transaction Documents;
(h) Qualified Securitization Transactions permitted under Section 6.01(e) and
transactions in connection therewith on a basis no less favorable to the applicable Company as
would be obtained in a comparable arms length transaction with a person not an Affiliate
thereof;
(i) cash management netting and pooled account arrangements permitted under Section
6.01(r);
(j) transactions between or among any Companies that are not Loan Parties;
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(k) transactions pursuant to a management agreement with the Specified Holders so long as
the aggregate payment of Management Fees thereunder are permitted under Section 6.08(c);
(l) transactions between Loan Parties and Companies that are not Loan Parties that are at
least as favorable to each such Loan Party as would reasonably be obtained by such Loan Party in
a comparable arms-length transaction with a person other than an Affiliate; and
(m) transactions contemplated by a Receivables Purchase Agreement;
provided that notwithstanding any of the foregoing or any other provision of this
Agreement, all intercompany loans, advances or other extensions of credit made to or by Companies
organized in Switzerland shall be on fair market terms.
SECTION 6.10 Minimum Consolidated Fixed Charge Coverage Ratio. At any time after the occurrence of a
Covenant Trigger Event and prior to the subsequent occurrence of a Covenant Recovery Event, permit
the Consolidated Fixed Charge Coverage Ratio, for the most recent Test Period ending upon or
immediately prior to such Covenant Trigger Event for which financial statements have been delivered
under Section 5.01(a) or (b) (or if a Default has occurred under Section
5.01(a) or (b), are required to have been delivered under Section 5.01(a) or
(b)), and any Test Period ending thereafter and prior to the subsequent occurrence of a
Covenant Recovery Event, to be less than 1.1 to 1.0.
SECTION 6.11 Prepayments of Other Indebtedness; Modifications of Organizational Documents and Other
Documents, etc.. Directly or indirectly:
(a) (i) make any voluntary or optional payment of principal on or prepayment on or
redemption or acquisition for value of, or complete any mandatory prepayment, redemption or
purchase offer in respect of, or otherwise voluntarily or optionally defease or segregate funds
with respect to, any Indebtedness incurred under Section 6.01(l), Permitted Second
Priority Refinancing Debt and Permitted Unsecured Refinancing Debt or any Indebtedness under the
New Senior Note Documents or any Subordinated Indebtedness or any Permitted Refinancings of any
of such Indebtedness, except any such Indebtedness may be prepaid or redeemed (y) with the
proceeds of a Permitted Refinancing or (z) if the Availability Conditions are satisfied at the
time thereof;
(ii) make any payment on or with respect to any Subordinated Indebtedness wholly among Loan
Parties in violation of the subordination provisions thereof; or
(iii) make any payment (whether, voluntary, mandatory, scheduled or otherwise) on or with
respect to any Subordinated Indebtedness (including payments of principal and interest thereon, but
excluding the discharge by Novelis AG (as consideration for the purchase of Accounts under the
Receivables Purchase Agreement) of loans or advances made by Novelis AG to German Seller or any
Swiss Seller), if an Event of Default is continuing or would result therefrom;
(b) with respect to any Term Loans under the Term Loan Documents (or any Permitted Term
Loan Facility Refinancings of any of such Indebtedness), unless the
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Availability Conditions are
satisfied, make any voluntary or optional payment of principal on or voluntary prepayment on or
voluntary acquisition for value of Indebtedness under the Term Loan Documents (except pursuant
to a Permitted Term Loan Facility Refinancing);
(c) amend or modify, or permit the amendment or modification of, any provision of any
document governing any Material Indebtedness (other than Indebtedness under the Loan Documents
or Term Loan Documents (or any Permitted Term Loan Facility Refinancings thereof)) in any manner
that, taken as a whole, is adverse in any material respect to the interests of the Lenders;
(d) amend or modify, or permit the amendment or modification of, any provision of any
document governing any Indebtedness under the Term Loan Documents (or any Permitted Term Loan
Facility Refinancings thereof) if such amendment or modification would (i) cause such
Indebtedness to have a final maturity date earlier than the final maturity date of, or have a
Weighted Average Life to Maturity shorter than the Weighted Average Life to Maturity of, such
Indebtedness immediately prior to such amendment or modification (excluding the effects of
nominal amortization in the amount of no greater than one percent per annum and prepayments of
Indebtedness), or (ii) result in the persons that are (or are required to be) obligors under
such Indebtedness to be different from the persons that are (or are required to be) obligors
under such Indebtedness being so amended or modified (unless such persons required to be
obligors under such Indebtedness are or are required to be or become obligors under the Loan
Documents); and provided that prior to the effectiveness of such amendment or modification, a
Responsible Officer of the Administrative Borrower shall have delivered an Officers Certificate
to the Administrative Agent (together with a reasonably detailed description of the material
terms and conditions of such amendment or modification or drafts of the documentation relating
thereto) certifying that the Administrative Borrower has determined in good faith that such
terms and conditions satisfy the foregoing requirements;
(e) terminate, amend or modify any of its Organizational Documents (including (x) by the
filing or modification of any certificate of designation and (y) any election to treat any
Pledged Securities (as defined in the Security Agreement) as a security under Section 8-103 of
the UCC other than (subject to the Intercreditor Agreement) concurrently with the delivery of
certificates representing such Pledged Securities to the Collateral Agent) or any agreement to
which it is a party with respect to its Equity Interests (including any stockholders
agreement), or enter into any new agreement with respect to its Equity Interests, other than any
such amendments or modifications or such new agreements which are not adverse in any material
respect to the interests of the Lenders; or
(f) amend or modify, or grant any consents, waivers or approvals with respect to, or permit
the amendment or modification of, or granting of any consents, waivers or approvals with respect
to, a Receivables Purchase Agreement, without the consent of the Administrative Agent (not to be
unreasonably withheld).
SECTION 6.12 Limitation on Certain Restrictions on Subsidiaries. Directly or indirectly, create or
otherwise cause or suffer to exist or become effective any encumbrance or restriction on the
ability of any Restricted Subsidiary of the Parent Borrower to (a) pay dividends
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or make any other
distributions on its Equity Interests or any other interest or participation in its profits owned
by the Parent Borrower or any Restricted Subsidiary of the Parent Borrower, or pay any Indebtedness
owed to the Parent Borrower or a Restricted Subsidiary of the Parent Borrower, (b) make loans or
advances to the Parent Borrower or any Restricted Subsidiary of the Parent Borrower or (c) transfer
any of its properties to the Parent Borrower or any Restricted Subsidiary of the Parent Borrower,
except for such encumbrances or restrictions existing under or by reason of (i) Applicable Law;
(ii) this Agreement and the other Loan Documents; (iii) the Senior Note Documents and the Term Loan
Documents or other Material Indebtedness; provided that in the case of such other Material
Indebtedness, such encumbrances and restrictions are, taken as a whole, no more restrictive than
such encumbrances and restrictions in the Term Loan Documents in existence on the Closing Date;
(iv) customary provisions restricting subletting or assignment of any lease governing a leasehold
interest of a Company; (v) customary provisions restricting assignment of any agreement entered
into by a Restricted Subsidiary of the Parent Borrower; (vi) any holder of a Lien permitted by
Section 6.02 restricting the transfer of the property subject thereto; (vii) customary
restrictions and conditions contained in any agreement relating to the sale of any property
permitted under Section 6.06 pending the consummation of such sale; (viii) any agreement in
effect at the time such Restricted Subsidiary of the Parent Borrower becomes a Restricted
Subsidiary of the Parent Borrower, so long as such agreement was not entered into in connection
with or in contemplation of such person becoming a Restricted Subsidiary of the Parent Borrower;
(ix) without affecting the Loan Parties obligations under Section 5.11, customary
provisions in partnership agreements, shareholders agreements, joint venture agreements, limited
liability company organizational governance documents and other Organizational Documents, entered
into in the ordinary course of business (or in connection with the formation of such partnership,
joint venture, limited liability company or similar person) that (A) restrict the transfer of
Equity Interests in such partnership, joint venture, limited liability company or similar person or
(B) the case of any Joint Venture or Joint Venture Subsidiary that is not a Loan Party, provide for
other restrictions of the type described in clauses (a), (b) and (c) above, solely with respect to
the Equity Interests in, or property held in, such joint venture, and customary provisions in asset
sale and stock sale agreements and other similar agreements permitted hereunder that provide for
restrictions of the type described in clauses (a), (b) and (c) above, solely with respect to the
assets or persons subject to such sale agreements; (x) restrictions on cash or other deposits or
net worth imposed by suppliers or landlords under contracts entered into in the ordinary course of
business; (xi) any instrument governing Indebtedness assumed in connection with any Permitted
Acquisition, which encumbrance or restriction is not applicable to any person, or the properties or
assets of any person, other than the person or the properties or assets of the person so acquired;
(xii) any encumbrances or restrictions imposed by any amendments or refinancings that are otherwise
not prohibited by the Loan Documents of the contracts, instruments or obligations referred to in
clauses (iii), (viii) or (xi) above; provided that such amendments or refinancings are no
more materially restrictive with respect to such encumbrances and restrictions than those prior to
such amendment or refinancing or (xiii) any restrictions on transfer of the Equity Interests in NKL
or its direct parents, 4260848 Canada Inc. and 4260856 Canada Inc., imposed by any lock-up or
listing agreement, rule or regulation in connection with any listing or offering of Equity
Interests in NKL to the extent required by Applicable Law or listing or stock exchange
requirements.
SECTION 6.13 Issuance of Disqualified Capital Stock. Issue any Disqualified Capital Stock except (i)
Joint Venture Subsidiaries and Excluded Collateral Subsidiaries may issue
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Disqualified Capital
Stock pursuant to Section 6.06(l) and (ii) issuances of Disqualified Capital Stock under
Section 6.04(i) shall be permitted.
SECTION 6.14 Parent Borrower. Allow the Chief Executive Office of Parent Borrower to be located outside
of the United States.
SECTION 6.15 Business.
(a) Each of Holdings, Novelis Europe Holdings Limited and Eurofoil shall not engage in any
business or activity other than (i) holding shares in the Equity Interests of its Subsidiaries
(which, in the case of Holdings, shall be limited to the Parent Borrower), (ii) holding
intercompany loans made to the Parent Borrower, (iii) other activities attributable to or
ancillary to its role as a holding company for its Subsidiaries, and (iv) compliance with its
obligations under the Loan Documents, the Term Loan Documents (and any Permitted Refinancings
thereof), and the Senior Note Documents (and any Permitted Refinancings thereof), the Additional
Senior Secured Indebtedness Documents and documents relating to Permitted First Priority
Refinancing Indebtedness, Permitted Second Priority Refinancing Indebtedness, Permitted
Unsecured Refinancing Indebtedness and Indebtedness under Section 6.01(l).
(b) The Parent Borrower and its Restricted Subsidiaries will not engage (directly or
indirectly) in any business other than those businesses in which Parent Borrower and its
Restricted Subsidiaries are engaged on the Closing Date as described in the Confidential
Information Memorandum (or, in the good faith judgment of the Board of Directors, which are
substantially related thereto or are reasonable extensions thereof).
(c) The Parent Borrower will not permit any Securitization Entity that it controls to
engage in any business or activity other than performing its obligations under the related
Qualified Securitization Transaction and will not permit any Securitization Entity that it
controls to hold any assets other than the Securitization Assets.
(d) No Loan Party (to the extent such Loan Party is subject to the Regulation) will have a
centre of main interest for the purposes of the Regulation other than as situated in its
jurisdiction of incorporation, except as set forth in clause (ii) of Section 3.27.
SECTION 6.16 Limitation on Accounting Changes. Make or permit any change in accounting policies or
reporting practices or tax reporting treatment, except changes that are permitted by GAAP or any
requirement of Applicable Law and disclosed to the Administrative Agent and changes described in
Section 1.04.
SECTION 6.17 Fiscal Year. Change its fiscal year-end to a date other than March 31.
SECTION 6.18 Margin Rules. Use the proceeds of any Loans, whether directly or indirectly, and whether
immediately, incidentally or ultimately, to purchase or carry margin stock (within the meaning of
Regulation U) or to extend credit to others for the purpose of purchasing or carrying margin stock
or to refund indebtedness originally incurred for such purpose.
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SECTION 6.19 No Further Negative Pledge. Enter into or suffer to exist any consensual agreement,
instrument, deed or lease which prohibits or limits the ability of any Loan Party to create, incur,
assume or suffer to exist any Lien upon any of their respective properties or revenues, whether now
owned or hereafter acquired to secure the Secured Obligations, or which requires the grant of any
security for an obligation if security is granted to secure the Secured Obligations, except the
following: (1) this Agreement and the other Loan Documents; (2) covenants in documents creating
Liens permitted by Section 6.02 prohibiting further Liens on the properties encumbered
thereby; (3) the Term Loan Documents, (4) the Additional Senior Secured Indebtedness Documents, and
documents relating to any Permitted First Priority Refinancing Debt, Permitted Second Priority
Refinancing Debt and Junior Secured Indebtedness (so long as such documents permit Liens to secure
the Secured Obligations); and (5) any prohibition or limitation that (a) exists pursuant to
Applicable Law, (b) consists of customary restrictions and conditions contained in any agreement
relating to the sale of any property permitted under Section 6.06 pending the consummation
of such sale, (c) restricts subletting or assignment of any lease governing a leasehold interest of
a Loan Party or a Subsidiary, (d) is permitted under Section 6.02(s), (e) exists in any
agreement or other instrument of a person acquired in an Investment permitted hereunder in
existence at the time of such Investment (but not created in connection therewith or in
contemplation thereof), which prohibition or limitation is not applicable to any person, or the
properties or assets of any person, other than the person, or the property or assets of the person
so acquired; and provided that no such person shall be a Borrowing Base Guarantor, and no
properties of any such person shall be included in the Borrowing Base, to the extent such
prohibition or limitation is applicable to the Liens under the Security Documents or requires the
grant or creation of a Lien on any of the Revolving Credit Priority Collateral, (f) is contained in
any joint venture, shareholders agreement, limited liability operating agreement or other
Organizational Document governing a Joint Venture or Joint Venture Subsidiary which limits the
ability of an owner of an interest in a Joint Venture or Joint Venture Subsidiary from encumbering
its ownership interest therein or (g) is imposed by any amendments or refinancings that are
otherwise permitted by the Loan Documents of the contracts, instruments or obligations referred to
in clause (3), (4) or (5)(e); provided that such amendments and refinancings are no more
materially restrictive with respect to such prohibitions and limitations than those prior to such
amendment or refinancing.
SECTION 6.20 Anti-Terrorism Law; Anti-Money Laundering.
(a) Directly or indirectly, (i) knowingly conduct any business or engage in making or
receiving any contribution of funds, goods or services to or for the benefit of any person
described in Section 3.22, (ii) knowingly deal in, or otherwise engage in any
transaction relating to, any property or interests in property blocked pursuant to the Executive
Order or any other Anti-Terrorism Law, or (iii) knowingly engage in or conspire to engage in any
transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to
violate, any of the prohibitions set forth in any Anti-Terrorism Law (and the Loan Parties shall
deliver to the Lenders any certification or other evidence requested from time to time by any
Lender in its reasonable discretion, confirming the Loan Parties compliance with this
Section 6.20).
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(b) Cause or permit any of the funds of such Loan Party that are used to repay the Loans to
be derived from any unlawful activity with the result that the making of the Loans would be in
violation of any requirement of Applicable Law.
SECTION 6.21 Embargoed Persons. Cause or permit (a) any of the funds or properties of the Loan Parties
that are used to repay the Loans to constitute property of, or be beneficially owned directly or
indirectly by, any person subject to sanctions or trade restrictions under United States law
(Embargoed Person or Embargoed Persons) that is identified on (1) the List of Specially
Designated Nationals and Blocked Persons maintained by OFAC and/or on any other similar list
maintained by OFAC pursuant to any authorizing statute including, but not limited to, the
International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., The Trading with the Enemy
Act, 50 U.S.C. App. 1 et seq., and any Executive Order or requirement of Applicable Law promulgated
thereunder, with the result that the investment in the Loan Parties (whether directly or
indirectly) is prohibited by a requirement of Applicable Law, or the Loans made by the Lenders
would be in violation of a requirement of Applicable Law, or (2) the Executive Order, any related
enabling legislation or any other similar Executive Orders or (b) any Embargoed Person to have any
direct or indirect interest, of any nature whatsoever in the Loan Parties, with the result that the
investment in the Loan Parties (whether directly or indirectly) is prohibited by a requirement of
Applicable Law or the Loans are in violation of a requirement of Applicable Law.
SECTION 6.22 Forward Share Sale Agreement and Support Agreement. With respect to the Parent Borrower,
assign, transfer, convey, sell or otherwise dispose of any of its right, title or interest in any
of the Forward Share Sale Agreement or the Support Agreement, except that such agreements may be
cancelled or terminated.
ARTICLE VII
GUARANTEE
SECTION 7.01 The Guarantee. The Guarantors hereby jointly and severally guarantee, as a primary obligor
and not as a surety to each Secured Party and their respective successors and permitted assigns,
the prompt payment in full when due (whether at stated maturity, by required prepayment,
declaration, demand, by acceleration or otherwise) of the principal of and interest (including any
interest, fees, costs or charges accruing after the commencement of an Insolvency Proceeding,
whether or not allowed (or which would have accrued, but for the commencement of such an Insolvency
Proceeding)) on the Loans made by the Lenders to, and the Notes held by each Lender of, each
Borrower, and all other Secured Obligations from time to time owing to the Secured Parties by any
Loan Party under any Loan Document or Bank Product Agreement entered into with a counterparty that
is a Secured Party, and the performance of all obligations under any of the foregoing, in each case
strictly in accordance with the terms thereof (such obligations being herein collectively called
the Guaranteed Obligations). In addition to the guarantee contained herein, each Guarantor that
is a Foreign Subsidiary, as well as Holdings, shall execute a Guarantee governed by the Applicable
Law of such Persons jurisdiction of organization (each such Guarantee, a Foreign Guarantee) and
to the extent that the provisions of this ARTICLE VII shall duplicate or conflict with the
provisions thereof, the terms of the Foreign Guarantees shall govern the obligations of such
Guarantors. The Guarantors hereby
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jointly and severally agree that if Borrower(s) or other
Guarantor(s) shall fail to pay in full when due (whether at stated maturity, by acceleration or
otherwise) any of the Guaranteed Obligations, the Guarantors will promptly pay the same in cash,
without any demand or notice whatsoever as if it was the principal obligor, and that in the case of
any extension of time of payment or renewal of any of the Guaranteed Obligations, the same will be
promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in
accordance with the terms of such extension or renewal. Without prejudice to the generality of
Section 7.01 and Section 7.02, each Guarantor expressly confirms that it intends
that this guarantee shall extend from time to time to any (however fundamental and of whatsoever
nature and whether or not more onerous) variation, increase, extension or addition of or to any of
the Loan Documents and/or any facility or amount made available under any of the Loan Documents for
the purposes of or in connection with any of the following: acquisitions of any nature; increasing
working capital; enabling investor distributions or Dividends to be made (including the Closing
Date Distribution); carrying out restructurings; refinancing existing facilities; refinancing any
other indebtedness; making facilities available to new borrowers; any other variation or extension
of the purposes for which any such facility or amount might be made available from time to time;
and any fees, costs and/or expenses associated with any of the foregoing.
SECTION 7.02 Obligations Unconditional. The obligations of the Guarantors under Section 7.01
shall constitute a guaranty of payment and not of collection and to the fullest extent permitted by
Applicable Law, are absolute, irrevocable and unconditional, joint and several, irrespective of the
value, genuineness, validity, regularity or enforceability of the Guaranteed Obligations of
Borrowers or any other Loan Party under this Agreement, the Notes, if any, or any other agreement
or instrument referred to herein or therein, or any substitution, release or exchange of any other
guarantee of or security for any of the Guaranteed Obligations, and, irrespective of any other
circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense
of a surety or Guarantor (except for payment in full). Without limiting the generality of the
foregoing, it is agreed that the occurrence of any one or more of the following shall not alter or
impair the liability of the Guarantors hereunder which shall remain absolute, irrevocable and
unconditional under any and all circumstances as described above:
(i) at any time or from time to time, without notice to the Guarantors, the time for any
performance of or compliance with any of the Guaranteed Obligations shall be extended, or such
performance or compliance shall be waived or the Maturity Date shall be extended with respect to
all or a portion of the Guaranteed Obligations;
(ii) any of the acts mentioned in any of the provisions of this Agreement or the Notes, if
any, or any other agreement or instrument referred to herein or therein shall be done or omitted;
(iii) the maturity of any of the Guaranteed Obligations shall be accelerated, or any of the
Guaranteed Obligations shall be amended in any respect, or any right under the Loan Documents or
any other agreement or instrument referred to herein or therein shall be amended or waived in any
respect or any other guarantee of any of the Guaranteed Obligations or any security therefor shall
be released or exchanged in whole or in part or otherwise dealt with;
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(iv) any Lien or security interest granted to, or in favor of, any Issuing Bank, Lender or
Agent as security for any of the Guaranteed Obligations shall fail to be perfected; or
(v) the release of any other Guarantor pursuant to Section 7.09.
The Guarantors hereby expressly waive diligence, presentment, demand of payment, protest and
all notices whatsoever, and any requirement that any Secured Party exhaust any right, power or
remedy or proceed against any Borrower or any other Loan Party under this Agreement or the Notes,
if any, or any other agreement or instrument referred to herein or therein, or against any other
person under any other guarantee of, or security for, any of the Guaranteed Obligations. The
Guarantors waive any and all notice of the creation, renewal, extension, waiver, termination or
accrual of any of the Guaranteed Obligations and notice of or proof of reliance by any Secured
Party upon this Guarantee or acceptance of this Guarantee, and the Guaranteed Obligations, and any
of them, shall conclusively be deemed to have been created, contracted or incurred in reliance upon
this Guarantee, and all dealings between Borrowers and the Secured Parties shall likewise be
conclusively presumed to have been had or consummated in reliance upon this Guarantee. This
Guarantee shall be construed as a continuing, absolute, irrevocable and unconditional guarantee of
payment without regard to any right of offset with respect to the Guaranteed Obligations at any
time or from time to time held by Secured Parties, and the obligations and liabilities of the
Guarantors hereunder shall not be conditioned or contingent upon the pursuit by the Secured Parties
or any other person at any time of any right or remedy against any Borrower or any other Loan
Party, or against any other person which may be or become liable in respect of all or any part of
the Guaranteed Obligations or against any collateral security or guarantee therefor or right of
offset with respect thereto. This Guarantee shall remain in full force and effect and be binding
in accordance with and to the extent of its terms upon the Guarantors and the successors and
assigns thereof, and shall inure to the benefit of the Lenders and the other Secured Parties, and
their respective successors and assigns, notwithstanding that from time to time during the term of
this Agreement there may be no Guaranteed Obligations outstanding.
SECTION 7.03 Reinstatement. The obligations of the Guarantors under this ARTICLE
VII shall be automatically reinstated if and to the extent that for any reason any payment
by or on behalf of any Borrower or other Loan Party in respect of the Guaranteed Obligations is
rescinded or must be otherwise restored by any holder of any of the Guaranteed Obligations, whether
as a result of any Insolvency Proceeding or otherwise. The Guarantors jointly and severally agree
that they will indemnify each Secured Party on demand for all reasonable costs and expenses
(including reasonable fees of counsel) incurred by such Secured Party in connection with such
rescission or restoration, including any such costs and expenses incurred in defending against any
claim alleging that such payment constituted a preference, fraudulent transfer or similar payment
under any Debtor Relief Law, other than any costs or expenses resulting from the bad faith or
willful misconduct of such Secured Party.
SECTION 7.04 Subrogation; Subordination. Each Guarantor hereby agrees that until the
indefeasible and irrevocable payment and satisfaction in full in cash of all Guaranteed Obligations
and the expiration and termination of the Commitments of the Lenders under this Agreement it shall
waive any claim and shall not exercise any right or remedy, direct or indirect, arising by reason
of any performance by it of its guarantee in Section 7.01, whether by
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subrogation or otherwise, against any Borrower or any other Guarantor of any of the Guaranteed
Obligations or any security for any of the Guaranteed Obligations. Any Indebtedness of any Loan
Party permitted pursuant to Section 6.01(d) (or any other loan or advance between Loan
Parties other than the Forward Share Sale Agreement) shall be subordinated to such Loan Partys
Secured Obligations a manner reasonably satisfactory to the Administrative Agent.
SECTION 7.05 Remedies. The Guarantors jointly and severally agree that, as between the Guarantors and
the Lenders, the obligations of Borrowers under this Agreement and the Notes, if any, may be
declared to be forthwith due and payable as provided in Section 8.01 (and shall be deemed
to have become automatically due and payable in the circumstances provided in Section 8.01)
for purposes of Section 7.01, notwithstanding any stay, injunction or other prohibition
preventing such declaration (or such obligations from becoming automatically due and payable) as
against Borrowers and that, in the event of such declaration (or such obligations being deemed to
have become automatically due and payable), such obligations (whether or not due and payable by
Borrowers) shall forthwith become due and payable by the Guarantors for purposes of Section
7.01.
SECTION 7.06 Instrument for the Payment of Money. Each Guarantor hereby acknowledges that the guarantee
in this ARTICLE VII constitutes an instrument for the payment of money, and consents and
agrees that any Lender or Agent, at its sole option, in the event of a dispute by such Guarantor in
the payment of any moneys due hereunder, shall have the right to bring a motion-action under New
York CPLR Section 3213.
SECTION 7.07 Continuing Guarantee. The guarantee in this ARTICLE VII is a continuing guarantee
of payment, and shall apply to all Guaranteed Obligations whenever arising.
SECTION 7.08 General Limitation on Guarantee Obligations. In any action or proceeding involving any
state corporate limited partnership or limited liability company law, or any Debtor Relief Law, if
the obligations of any Guarantor under Section 7.01 would otherwise be held or determined
to be void, voidable, invalid or unenforceable, or subordinated to the claims of any other
creditors, on account of the amount of its liability under Section 7.01, then,
notwithstanding any other provision to the contrary, the amount of such liability shall, without
any further action by such Guarantor, any Loan Party or any other person, be automatically limited
and reduced to the highest amount after giving effect to the rights of contribution established in
the Contribution, Intercompany, Contracting and Offset Agreement that are valid and enforceable and
not subordinated to the claims of other creditors as determined in such action or proceeding.
SECTION 7.09 Release of Guarantors. If, in compliance with the terms and provisions of the Loan
Documents, (a) Equity Interests of any Subsidiary Guarantor are issued, sold or transferred such
that it ceases to be a Restricted Subsidiary (a Transferred Guarantor) to a person or persons,
none of which is a Loan Party or a Subsidiary, (b) a Guarantor is designated as an Unrestricted
Subsidiary in accordance with the Loan Documents, (c) a Restricted Subsidiary that becomes a Loan
Party after the Closing Date is subsequently designated as an Excluded Collateral Subsidiary in
accordance with the definition thereof, or (d) a Qualified Parent Borrower IPO shall occur, then,
such Transferred Guarantor (in the case of clause (a)), such Unrestricted Subsidiary (in the case
of clause (b)), such Restricted Subsidiary (in the case of
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clause (c)), or Holdings (in the case of clause (d)), shall, upon the consummation of such
issuance, sale or transfer or upon such designation as an Unrestricted Subsidiary or Excluded
Collateral Subsidiary or upon the completion of the Qualified Parent Borrower IPO, be released from
its obligations under this Agreement (including under Section 11.03 hereof) and any other
Loan Documents to which it is a party and its obligations to pledge and grant any Collateral owned
by it pursuant to any Security Document, and the Collateral Agent shall take such actions as are
within its powers to effect each release described in this Section 7.09 in accordance with
the relevant provisions of the Security Documents and the Intercreditor Agreement; provided
that such Guarantor is also released from its obligations, if any, under the Term Loan Documents,
the Senior Note Documents, the Additional Senior Secured Indebtedness Documents and other Material
Indebtedness guaranteed by such Person on the same terms.
SECTION 7.10 Certain Tax Matters. Notwithstanding the provisions of Sections 2.06(j),
2.15, 2.21 or 2.22, if a Loan Party makes a payment hereunder that is
subject to withholding tax in excess of the withholding tax that would have been imposed on
payments made by the Borrower with respect to whose obligation it is making a payment, the Loan
Parties shall increase the amount of such payment such that, after deduction and payment of all
such withholding taxes (including withholding taxes applicable to additional sums payable under
this Section), the payee receives an amount equal to the amount it would have received if
no such excess withholding tax had been imposed; provided, that the Agent or Lender
provides, as reasonably requested by the relevant Loan Party and as required under Sections
2.15(e), 2.15(g), or 2.15(h), as the case may be, such forms, certificates and
documentation that it is legally entitled to furnish and would be required to reduce or eliminate
withholding and, with respect to non-U.S. withholding taxes, would not, in the Administrative
Agents or the relevant Lenders reasonable judgment, subject it to any material unreimbursed costs
or otherwise be disadvantageous to it in any material respect.
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SECTION 7.11 German Guarantor.
(a) Subject to Section 7.11(b) through Section 7.11(e) below, the
Secured Parties shall not enforce the guarantee obligations of a German Guarantor existing in
the form of a German limited liability company or limited partnership with a limited liability
company as partner (GmbH or GmbH & Co. KG) under this Article VII to the extent (i) such
German Guarantor guarantees obligations of one of its shareholders or of an affiliated company
(verbundenes Unternehmen) of a shareholder within the meaning of Section 15 of the German Stock
Corporation Act (Aktiengesetz) (other than a Subsidiary of that German Guarantor or the German
Guarantor itself), and (ii) the enforcement of such guarantee for shareholder obligations would
reduce, in violation of Section 30 of the German Limited Liability Companies Act (GmbHG), the
net assets (assets minus liabilities minus provisions and liability reserves (Reinvermögen), in
each case as calculated in accordance with generally accepted accounting principles in Germany
(Grundsätze ordnungsmäßiger Buchführung) as consistently applied by such German Guarantor in
preparing its unconsolidated balance sheets (Jahresabschluss gem. § 42 GmbH Act, §§ 242, 264
HGB) of the German Guarantor (or in the case of a GmbH & Co. KG, its general partner) to an
amount that is insufficient to maintain its (or in the case of a GmbH & Co. KG, its general
partners) registered share capital (Stammkapital) (or would increase an existing shortage in
its net assets below its registered share capital); provided that for the purpose of
determining the relevant registered share capital and the net assets, as the case may be:
(i) The amount of any increase of registered share capital (Stammkapital) of such German
Guarantor (or its general partner in the form of a GmbH) implemented after the date of this
Agreement that is effected without the prior written consent of the Administrative Agent shall be
deducted from the registered share capital of the German Guarantor (or its general partner in the
form of a GmbH);
(ii) any loans provided to the German Guarantor by a direct or indirect shareholder or an
affiliate thereof (other than a Subsidiary of such German Guarantor) shall be disregarded and not
accounted for as a liability to the extent that such loans are subordinated pursuant to Section
39(1) Nr. 1 through Nr. 5 of the German Insolvency Code (Insolvenzordnung) or subordinated in any
other way by law or contract;
(iii) any shareholder loans, other loans and contractual obligations and liabilities
incurred by the German Guarantor in violation of the provisions of any of the Loan Documents shall
be disregarded and not accounted for as liabilities;
(iv) any assets that are shown in the balance sheet with a book value that, in the opinion
of the Administrative Agent, is significantly lower than their market value and that are not
necessary for the business of the German Guarantor (nicht betriebsnotwendig) shall be accounted for
with their market value; and
(v) the assets of the German Guarantor will be assessed at liquidation values
(Liquidationswerte) if, at the time the managing directors prepare the balance sheet in accordance
with paragraph (b) below and absent the demand a positive going concern prognosis (positive
Fortbestehensprognose) cannot be established.
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(b) The limitations set out in Section 7.11(a) only apply:
(i) if and to the extent that the managing directors of the German Guarantor (or in the
case of a GmbH Co. KG, its general partner) have confirmed in writing to the Administrative Agent
within ten Business Days of a demand for payment under this Article VII the amount of the
obligations under this Article VII which cannot be paid without causing the net assets of
such German Guarantor (or in the case of a GmbH Co. KG, its general partner) to fall below its
registered share capital, or increase an existing shortage in net assets below its registered share
capital (taking into account the adjustments set out above) and such confirmation is supported by a
current balance sheet and other evidence satisfactory to the Administrative Agent and neither the
Administrative Agent nor any Lender raises any objections against that confirmation within five
Business Days after its receipt; or
(ii) if, within twenty Business Days after an objection under clause (i) has been raised
by the Administrative Agent or a Lender, the Administrative Agent receives a written audit report
(Auditors Determination) prepared at the expense of the relevant German Guarantor by a firm of
auditors of international standing and reputation that is appointed by the German Guarantor and
reasonably acceptable to the Administrative Agent, to the extent such report identifies the amount
by which the net assets of that German Guarantor (or in the case of a GmbH & Co. KG, its general
partner in the form of a GmbH) are necessary to maintain its registered share capital as at the
date of the demand under this Article VII (taking into account the adjustments set out
above). The Auditors Determination shall be prepared in accordance with generally accepted
accounting principles applicable in Germany (Grundsätze ordnungsgemäßer Buchführung) as
consistently applied by the German Guarantor in the preparation of its most recent annual balance
sheet. The Auditors Determination shall be binding for all Parties except for manifest error.
(c) In any event, the Secured Parties shall be entitled to enforce the guarantee up to
those amounts that are undisputed between them and the relevant German Guarantor or determined
in accordance with Section 7.11(a) and Section 7.11(b). In respect of the
exceeding amounts, the Secured Parties shall be entitled to further pursue their claims (if any)
and the German Guarantor shall be entitled to provide evidence that the excess amounts are
necessary to maintain its registered share capital (calculated as at the date of demand under
this Article VII and taking into account the adjustments set out above). The Secured
Parties are entitled to pursue those parts of the guarantee obligations of the German Guarantor
that are not enforced by operation of Section 7.11(a) above at any subsequent point in
time. This Section 7.11 shall apply again as of the time such additional demands are
made.
(d) Section 7.11(a) shall not apply as to the amount of Loans borrowed under
this Agreement and passed on (whether by way of shareholder loan or equity contribution) to the
respective German Guarantor or any of its Subsidiaries as long as the respective shareholder
loan is outstanding or the respective equity contribution has not been dissolved or otherwise
repaid.
(e) Should it become legally permissible for managing directors of a German Guarantor
to enter into guarantees in support of obligations of their shareholders without limitations,
the limitations set forth in Section 7.11(a) shall no longer apply. Should any such
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guarantees become subject to legal restrictions that are less stringent than the
limitations set forth in Section 7.11(a) above, such less stringent limitations shall
apply. Otherwise, Section 7.11(a) shall remain unaffected by changes in Applicable Law.
(f) The limitations provided for in paragraph (a) above shall not apply where (i) the
relevant German Guarantor has a fully valuable (vollwertig) recourse claim (Gegenleistungs- oder
Rückgewähranspruch) vis-à-vis the relevant shareholder or (ii) a domination agreement
(Beherrschungsvertrag) or a profit and loss pooling agreement (Ergebnisabführungsvertrag) is or
will be in existence with the relevant German Guarantor (or the relevant general partner) and
the relevant German Guarantor has a fully valuable (vollwertig) compensation claim
(Ausgleichsanspruch).
SECTION 7.12 Swiss Guarantors. If and to the extent that (i) the obligations under this ARTICLE
VII of any Swiss Guarantor are for the exclusive benefit of any of such Swiss Guarantors
Affiliates (other than such Swiss Guarantors direct or indirect Subsidiaries) and (ii) complying
with the obligations under this ARTICLE VII would constitute a repayment of capital
(restitution des apports) or the payment of a (constructive) dividend (distribution de dividende),
the following shall apply:
(a) The aggregate obligations under this ARTICLE VII of any Swiss Guarantor
shall be limited to the maximum amount of such Swiss Guarantors profits and reserves available
for distribution, in each case in accordance with, without limitation, articles 671 para.1 to 3
and 675 para.2 of the Swiss Code of Obligations (the Available Amount) at the time any Swiss
Guarantor makes a payment under this ARTICLE VII (provided such limitation is still a
legal requirement under Swiss law at that time).
(b) Immediately after having been requested to make a payment under this ARTICLE
VII (the Guarantee Payment), each Swiss Guarantor shall (i) provide the Administrative
Agent, within thirty (30) Business Days from being requested to make the Guarantee Payment, with
(1) an interim audited balance sheet prepared by the statutory auditors of the applicable Swiss
Guarantor, (2) the determination of the Available Amount based on such interim audited balance
sheet as computed by the statutory auditors, and (3) a confirmation from the statutory auditors
that the Available Amount is the maximum amount which can be paid by the Swiss Guarantor under
this ARTICLE VII without breaching the provisions of Swiss corporate law, which are
aimed at protecting the share capital and legal reserves, and (ii) upon receipt of the
confirmation referred to in the preceding sentence under (3) and after having taken all actions
required pursuant to paragraph (d) below, make such Guarantee Payment in full (less, if
required, any Swiss Withholding Tax).
(c) If so required under Swiss law (including double tax treaties to which Switzerland
is a party) at the time it is required to make a payment under this ARTICLE VII or the
Security Documents, the applicable Swiss Guarantor (1) may deduct the Swiss Withholding Tax at
the rate of 35% (or such other rate as may be in force at such time) from any payment under this
ARTICLE VII or the Security Documents, (2) may pay the Swiss Withholding Tax to the
Swiss Federal Tax Administration, and (3) shall notify and provide evidence to the
Administrative Agent that the Swiss Withholding Tax has been paid to the Swiss Federal Tax
Administration. To the extent the Guarantee Payment due is less than the
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Available Amount, the applicable Swiss Guarantor shall be required to make a gross-up,
indemnify or otherwise hold harmless the Secured Parties for the deduction of the Swiss
Withholding Tax, it being understood that at no time shall the Guarantee Payment (including any
gross-up or indemnification payment pursuant to this paragraph (c) and including any Swiss
Withholding Tax levied thereon) exceed the Available Amount. The applicable Swiss Guarantor
shall use its best efforts to ensure that any person which is, as a result of a payment under
this ARTICLE VII, entitled to a full or partial refund of the Swiss Withholding Tax,
shall as soon as possible after the deduction of the Swiss Withholding Tax (i) request a refund
of the Swiss Withholding Tax under any Applicable Law (including double tax treaties) and (ii)
pay to the Administrative Agent for distribution to the Secured Parties upon receipt any amount
so refunded. The Secured Obligations will only be considered as discharged to the extent of the
effective payment received by the Secured Parties under this ARTICLE VII. This
subsection (c) is without prejudice to the gross-up or indemnification obligations of any
Guarantor other that the Swiss Guarantors.
(d) The Swiss Guarantors shall use reasonable efforts to take and cause to be taken all
and any other action, including the passing of any shareholders resolutions to approve any
Guarantee Payment under this ARTICLE VII or the Security Documents, which may be
required as a matter of Swiss mandatory law or standard business practice as existing at the
time it is required to make a Guarantee Payment under this ARTICLE VII or the Security
Documents in order to allow for a prompt payment of the Guarantee Payment or Available Amount,
as applicable.
(e) To the extent (i) the Swiss Borrower is jointly and severally liable towards the
Lenders for obligations under this Agreement of the Swiss Borrowers Affiliates (other than the
Swiss Borrowers direct or indirect Subsidiaries) which were incurred for the exclusive benefit
of such Swiss Borrowers Affiliates and (ii) complying with such joint and several obligations
would constitute a repayment of capital (restitution des apports) or the payment of a
(constructive) dividend (distribution de dividende), then paragraphs (a) to (d) of this
Section 7.12 shall be applicable to such obligations. For the avoidance of doubt this
paragraph is without prejudice to the joint and several liability of any Loan Party (other than
the Swiss Borrower) for any obligations arising under this Agreement.
SECTION 7.13 Irish Guarantor. This Guarantee does not apply to any liability to the extent that it
would result in this Guarantee constituting unlawful financial assistance within the meaning of, in
respect of any Irish Guarantor, Section 60 of the Companies Act 1963 of Ireland.
SECTION 7.14 Brazilian Guarantor. The Brazilian Guarantor waives and shall not exercise any and all
rights and privileges granted to guarantors which might otherwise be deemed applicable, including
but not limited to the rights and privileges referred to in Articles 827, 834, 835, 836, 837, 838
and 839 of the Brazilian Civil Code and the provisions of Article 595 of the Brazilian Civil
Procedure Code.
SECTION 7.15 French Guarantor.
(a) The obligations and liabilities of a French Guarantor under the Loan Documents and
in particular under Article VII (Guarantee) of this Agreement shall not
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include any obligation or liability which if incurred would constitute the provision of financial
assistance within the meaning of article L. 225-216 of the French Code de commerce and/or would
constitute a misuse of corporate assets within the meaning of article L. 241-3 or L. 242-6 of
the French Code de commerce or any other laws or regulations having the same effect, as
interpreted by French courts.
(b) The obligations and liabilities of a French Guarantor under Article VII
(Guarantee) of this Agreement for the obligations under the Loan Documents of any other
Guarantor which is not a French Subsidiary of such French Guarantor, shall be limited at any
time to an amount equal to the aggregate of all amounts borrowed under this Agreement by such
other Guarantor as Borrower to the extent directly or indirectly on-lent to the French Guarantor
under inter-company loan agreements and outstanding at the date a payment is to be made by such
French Guarantor under Article VII (Guarantee) of this Agreement, it being
specified that any payment made by a French Guarantor under Article VII
(Guarantee) of the Credit Agreement in respect of the obligations of such Guarantor as
Borrower shall reduce pro tanto the outstanding amount of the inter-company loans due by the
French Guarantor under the inter-company loan arrangements referred to above.
(c) The obligations and liabilities of a French Guarantor under Article VII
(Guarantee) of this Agreement for the obligations under the Loan Documents of any
Guarantor which is its Subsidiary shall not be limited and shall therefore cover all amounts due
by such Guarantor as Borrower and/or as Guarantor, as applicable. However, where such
Subsidiary is not incorporated in France, the amounts payable by the French Guarantor under this
paragraph (c) in respect of obligations of this Subsidiary as Borrower and/or Guarantor, shall
be limited as set out in paragraph (b) above.
SECTION 7.16 Luxembourg Guarantor.
(a) If and to the extent that the obligations of the Luxembourg Guarantor under this
Guarantee are for the exclusive benefit of the Luxembourg Guarantors direct and indirect parent
entities and Affiliates (except the Luxembourg Guarantors (direct or indirect) Subsidiaries),
the following shall apply:
(i) Notwithstanding any thing to the contrary, (A) the obligations and liabilities of the
Luxembourg Guarantor under this Guarantee and (B) the obligations secured by the Collateral granted
by such Luxembourg Guarantor pursuant to this Agreement and any other Loan Documents, shall at no
time, in aggregate, exceed an amount equal to the maximum financial capacity of such Luxembourg
Guarantor, such maximum financial capacity being limited to ninety-five per cent (95%) of the net
Luxembourg Guarantor capitaux propres (as referred to in article 34 of the Luxembourg law of
December 19, 2002, on the commercial register and annual accounts, where the capitaux propres mean
the shareholders equity (including the share capital, share premium, legal and statutory reserves,
other reserves, profit and losses carried forward, investment subsidies and regulated provisions)
of such Luxembourg Guarantor as shown in the latest financial statements (comptes annuels)
available at the date of the relevant payment hereunder and approved by the shareholders of such
Luxembourg Guarantor and certified by the statutory auditor, as the case may be, or as applicable
its external auditor (réviseur dentreprises), if required by law.
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(ii) None of the above restrictions shall apply to the extent of: (A) the total payment
obligations of such Luxembourg Guarantors Subsidiaries under this Agreement and any other Loan
Documents; and (B) the payment obligations of any Loan Party where that Loan Party is not a
subsidiary of the Luxembourg Guarantor, up to an amount equal to the amounts borrowed (directly or
indirectly) by way of intra-group loans from such Loan Party by the Luxembourg Guarantor or such
Luxembourg Guarantors Subsidiaries.
The obligations and liabilities of the Luxembourg Guarantor under this Guarantee shall not include
any obligation which, if incurred, would constitute either (a) a misuse of corporate assets as
defined under Article 171-1 of the Luxembourg Company Act of August 10, 1915, as amended from time
to time, (the Luxembourg Company Act) or (b) financial assistance.
(b) The Luxembourg Guarantor shall use reasonable efforts to take and cause to be taken
all and any other action, including if required the passing of any shareholders resolutions to
approve any payment under this Guarantee or otherwise under this Agreement and the other Loan
Documents, which may be required as a matter of Luxembourg law or standard business practice as
existing at the time it is required to make a payment under this Guarantee or otherwise under
this Agreement and the other Loan Documents in order to allow for prompt payment of such
payments under this Guarantee or otherwise under this Agreement and other Loan Documents, as
applicable.
ARTICLE VIII
EVENTS OF DEFAULT
SECTION 8.01 Events of Default. Upon the occurrence and during the continuance of the following events
(Events of Default):
(a) default shall be made in the payment of any principal of any Loan or any
Reimbursement Obligation when and as the same shall become due and payable, whether at the due
date thereof or at a date fixed for prepayment (whether voluntary or mandatory) thereof or by
acceleration thereof or otherwise;
(b) default shall be made in the payment of any interest on any Loan or any Fee or any
other amount (other than an amount referred to in paragraph (a) above) due under any Loan
Document, when and as the same shall become due and payable, and such default shall continue
unremedied for a period of three (3) Business Days;
(c) any representation or warranty made or deemed made in or in connection with any
Loan Document or the borrowings or issuances of Letters of Credit hereunder, or which is
contained in any certificate furnished by or on behalf of a Loan Party pursuant to this
Agreement or any other Loan Document, shall prove to have been false or misleading in any
material respect when so made or deemed made;
(d) default shall be made in the due observance or performance by any Company of any
covenant, condition or agreement contained in (i) Section 5.02(a), Section
5.03(a), Section 5.08, Section 5.17, Section 9.01(e), Section
9.02(d), Section 9.02(e), Section 9.03, and ARTICLE VI or (ii)
Section 5.04(a) or Section 5.04(b) (provided that in the case of
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defaults under Sections 5.04(a) or (b) which do not impair in any material
respect the insurance coverage maintained on the Collateral or the Companies assets taken as a
whole, then such default will not constitute an Event of Default unless such default has
continued unremedied for a period of three (3) Business Days;
(e) (i) default shall be made in the due observance or performance by any Company of any
covenant, condition or agreement contained in Section 5.02 (other than Section
5.02(a)), or ARTICLE IX (other than Section 9.01(e), Section
9.02(d), Section 9.02(e), and Section 9.03), and such default shall continue
unremedied or shall not be waived for a period of five (5) Business Days after written notice
thereof from the Administrative Agent or any Lender to Administrative Borrower, or (ii) default
shall be made in the due observance or performance by any Company of any covenant, condition or
agreement contained in any Loan Document (other than those specified in paragraphs (a), (b), (d)
or (e)(i) immediately above) and such default shall continue unremedied or shall not be waived
for a period of thirty (30) days after written notice thereof from the Administrative Agent or
any Lender to Administrative Borrower;
(f) any Company shall (i) fail to pay any principal or interest, regardless of amount,
due in respect of any Indebtedness (other than the Obligations), when and as the same shall
become due and payable beyond any applicable grace period, or (ii) fail to observe or perform
any other term, covenant, condition or agreement contained in any agreement or instrument
evidencing or governing any such Indebtedness if the effect of any failure referred to in this
clause (ii) is to cause, or to permit (in the case of the Senior Notes only, if any notice (a
Default Notice) shall be required to commence a grace period or declare the occurrence of an
event of default with regard to the Senior Notes before notice of acceleration may be delivered,
delivery of such Default Notice shall constitute a Default hereunder (but not an Event of
Default) until such time as the Senior Notes may be accelerated, at which point an Event of
Default shall occur hereunder) the holder or holders of such Indebtedness or a trustee or other
representative on its or their behalf to cause such Indebtedness to become due prior to its
stated maturity or become subject to a mandatory offer purchase by the obligor; provided
that, other than in the case of the Term Loans, it shall not constitute an Event of Default
pursuant to this paragraph (f) unless the aggregate Dollar Equivalent amount of all such
Indebtedness referred to in clauses (i) and (ii) exceeds $100,000,000 at any one time
(provided that, in the case of Hedging Obligations, the amount counted for this purpose
shall be the net amount payable by all Companies if such Hedging Obligations were terminated at
such time);
(g) an involuntary proceeding shall be commenced or an involuntary petition shall be
filed in a court of competent jurisdiction seeking (i) relief in respect of any Loan Party or
Material Subsidiary, or of a substantial part of the property of any Loan Party or Material
Subsidiary, under Title 11 of the U.S. Code, as now constituted or hereafter amended, or any
other federal, state, provincial or foreign bankruptcy, insolvency, receivership, reorganization
or other Debtor Relief Law, including any proceeding under applicable corporate law; (ii) the
appointment of a receiver, trustee, custodian, sequestrator, conservator, examiner or similar
official for any Loan Party or Material Subsidiary or for a substantial part of the property of
any Loan Party or Material Subsidiary; or (iii) the winding-up, liquidation or examination of
any Loan Party or Material Subsidiary; and such proceeding or petition
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shall continue undismissed for sixty (60) days or an order or decree approving or ordering any of the
foregoing shall be entered;
(h) any Loan Party or Material Subsidiary shall (i) voluntarily commence any proceeding
or file any petition seeking relief under Title 11 of the United States Code, as now constituted
or hereafter amended, or any other federal, state or foreign bankruptcy, insolvency,
receivership or other Debtor Relief Law; (ii) consent to the institution of, or fail to contest
in a timely and appropriate manner, any proceeding or the filing of any petition described in
clause (g) above; (iii) apply for or consent to the appointment of a receiver, trustee,
custodian, sequestrator, conservator, examiner or similar official for any Loan Party or
Material Subsidiary or for a substantial part of the property of any Loan Party or Material
Subsidiary; (iv) file an answer admitting the material allegations of a petition filed against
it in any such proceeding; (v) make a general assignment for the benefit of creditors; (vi)
become unable, admit in writing its insolvency or inability or fail generally to pay its debts
as they become due; (vii) take any action for the purpose of effecting any of the foregoing;
(viii) wind up or liquidate (except in accordance with Section 6.05) or put into
examination, or (ix) take any step with a view to a moratorium or a composition or similar
arrangement with any creditors of any Loan Party or Material Subsidiary, or a moratorium is
declared or instituted in respect of the indebtedness of any Loan Party or Material Subsidiary;
(i) one or more judgments, orders or decrees for the payment of money in an aggregate
Dollar Equivalent amount in excess of $100,000,000, to the extent not covered by insurance or
supported by a letter of credit or appeal bonds posted in cash, shall be rendered against any
Company or any combination thereof and the same shall remain undischarged, unvacated or unbonded
for a period of thirty (30) consecutive days during which execution shall not be effectively
stayed, or any action shall be legally taken by a judgment creditor to levy upon properties of
any Company to enforce any such judgment;
(j) one or more ERISA Events or noncompliance with respect to Foreign Plans or
Compensation Plans shall have occurred that, when taken together with all other such ERISA
Events and noncompliance with respect to Foreign Plans or Compensation Plans that have occurred,
could reasonably be expected to result in liability of any Company and its ERISA Affiliates that
could reasonably be expected to result in a Material Adverse Effect;
(k) any security interest and Lien purported to be created by any Security Document
shall cease to be in full force and effect, or shall cease to give the Collateral Agent (or its
co-agent or subagent), for the benefit of the Secured Parties, a valid, perfected First Priority
(subject to the Intercreditor Agreement) security interest in and Lien on all of the Collateral
thereunder (except as otherwise expressly provided in such Security Document) in favor of the
Collateral Agent (or its co-agent or subagent), or shall be asserted by any Borrower or any
other Loan Party not to be a valid, perfected, First Priority (except as otherwise expressly
provided in this Agreement, the Intercreditor Agreement or such Security Document) security
interest in or Lien on the Collateral covered thereby;
(l) any Loan Document or any material provision thereof shall at any time and for any
reason be declared by a court of competent jurisdiction to be null and void, or a proceeding
shall be commenced by any Loan Party or by any Governmental Authority,
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seeking to establish the invalidity or unenforceability thereof (exclusive of questions of
interpretation of any provision thereof), or any Loan Party shall repudiate or deny any portion
of its liability or obligation for the Obligations;
(m) there shall have occurred a Change in Control;
(n) the Intercreditor Agreement or any material provision thereof shall cease to be in
full force or effect other than (i) as expressly permitted hereunder or thereunder, (ii) by a
consensual termination or modification thereof agreed to by the Agents party thereto, the Term
Loan Administrative Agent, the Term Loan Collateral Agent and all other creditors of the Parent
Borrower and its Restricted Subsidiaries (or any trustee, agent or representative acting on
their behalf) that are parties thereto, or (iii) as a result of satisfaction in full of the
obligations under the Term Loan Documents, the Additional Senior Secured Indebtedness Documents
(if any), the Junior Secured Indebtedness Documents (if any) and any other Material Indebtedness
subject to the terms of the Intercreditor Agreement;
(o) any Company shall be prohibited or otherwise restrained from conducting the
business theretofore conducted by it in any manner that has or could reasonably be expected to
result in a Material Adverse Effect by virtue of any determination, ruling, decision, decree or
order of any court or Governmental Authority of competent jurisdiction; or
(p) a Termination Event (as defined therein) has occurred under a Receivables
Purchase Agreement;
then, and in every such event (other than an event with respect to any Loan Party described in
paragraph (g) or (h) above), and at any time thereafter during the continuance of such event, the
Administrative Agent may, and at the request of the Required Lenders shall, by notice to
Administrative Borrower, take either or both of the following actions, at the same or different
times: (i) terminate forthwith the Commitments and (ii) declare the Loans and Reimbursement
Obligations then outstanding to be forthwith due and payable in whole or in part, whereupon the
principal of the Loans and Reimbursement Obligations so declared to be due and payable, together
with accrued interest thereon and any unpaid accrued Fees and all other Obligations of the Loan
Parties accrued hereunder and under any other Loan Document, shall become forthwith due and
payable, without presentment, demand, protest or any other notice of any kind, all of which are
hereby expressly waived by each of the Loan Parties, anything contained herein or in any other Loan
Document to the contrary notwithstanding; and in any event, with respect to any Loan Party
described in paragraph (g) or (h) above, the Commitments shall automatically terminate and the
principal of the Loans and Reimbursement Obligations then outstanding, together with accrued
interest thereon and any unpaid accrued Fees and all other Obligations of the Loan Parties accrued
hereunder and under any other Loan Document, shall automatically become due and payable, without
presentment, demand, protest or any other notice of any kind, all of which are hereby expressly
waived by each of the Loan Parties, anything contained herein or in any other Loan Document to the
contrary notwithstanding.
SECTION 8.02 Rescission. If at any time after termination of the Commitments or acceleration of the
maturity of the Loans, the Loan Parties shall pay all arrears of interest and all payments on
account of principal of the Loans and Reimbursement Obligations owing by them
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that shall have become due otherwise than by acceleration (with interest on principal and, to the
extent permitted by law, on overdue interest, at the rates specified herein) and all Defaults
(other than non-payment of principal of and accrued interest on the Loans due and payable solely by
virtue of acceleration) shall be remedied or waived pursuant Section 11.02, then upon the
written consent of the Required Lenders and written notice to the Administrative Borrower, the
termination of the Commitments or the acceleration and their consequences may be rescinded and
annulled; but such action shall not affect any subsequent Default or impair any right or remedy
consequent thereon. The provisions of the preceding sentence are intended merely to bind the
Lenders and the Issuing Banks to a decision that may be made at the election of the Required
Lenders, and such provisions are not intended to benefit any Loan Party and do not give any Loan
Party the right to require the Lenders to rescind or annul any acceleration hereunder, even if the
conditions set forth herein are met.
SECTION 8.03 Application of Proceeds. Notwithstanding anything herein to the contrary (but subject to
Section 2.14(f) and the terms of the Intercreditor Agreement), during an Event of Default,
monies to be applied to the Secured Obligations, whether arising from payments by Loan Parties,
realization on Collateral, setoff or otherwise, shall be allocated as follows (including any
payments received with respect to adequate protection payments or other distributions relating to
the Secured Obligations during the pendency of any reorganization or insolvency proceeding):
(a) First, to all costs and expenses, including Extraordinary Expenses, owing to any
Agent or Receiver;
(b) Second, to all amounts owing to a Swingline Lender on Swingline Loans;
(c) Third, to all amounts owing to Issuing Banks on LC Obligations;
(d) Fourth, to all Secured Obligations constituting fees (other than Secured Bank
Product Obligations);
(e) Fifth, to all Secured Obligations constituting interest (other than Secured Bank
Product Obligations);
(f) Sixth, to cash collateralize all outstanding Letters of Credit in an amount equal
to 105% of LC Exposure;
(g) Seventh, to all Loans; and
(h) Eighth, to all other Secured Obligations.
Amounts shall be applied to each category of Secured Obligations set forth above until Full
Payment thereof and then to the next category. If amounts are insufficient to satisfy a category,
they shall be applied on a pro rata basis among the Secured Obligations in the category. Amounts
distributed with respect to any Secured Bank Product Obligations shall be the lesser of the maximum
Secured Bank Product Obligations last reported to Administrative Agent or the actual Secured Bank
Product Obligations as calculated by the methodology reported to Administrative Agent for
determining the amount due. No Agent shall have any obligation to
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calculate the amount to be distributed with respect to any Secured Bank Product Obligations,
and Administrative Agent may request a reasonably detailed calculation of such amount from the
applicable Secured Party. If a Secured Party fails to deliver such calculation within five days
following request by Administrative Agent, Administrative Agent may assume the amount to be
distributed is zero. The allocations set forth in this Section are solely to determine the
rights and priorities of Administrative Agent and Secured Parties as among themselves, and may be
changed by agreement among them without the consent of any Loan Party. This Section is not
for the benefit of or enforceable by any Loan Party.
ARTICLE IX
COLLATERAL ACCOUNT; COLLATERAL MONITORING; APPLICATION OF COLLATERAL PROCEEDS
Each Loan Party covenants and agrees with each Lender that so long as this Agreement shall
remain in effect and until Full Payment of the Obligations, unless Administrative Agent, or the
Required Lenders, shall otherwise consent in writing:
SECTION 9.01 Accounts; Cash Management.
The Loan Parties in the United States, Canada, England and Wales, Switzerland, and Germany
(and any other jurisdiction in which a Borrower, Borrowing Base Guarantor or Receivables Seller is
located) (the Borrowing Base Loan Parties) shall maintain a cash management system which is
acceptable to the Administrative Agent (the Cash Management System), which shall operate as
follows:
(a) All funds held by any Borrowing Base Loan Party (other than funds being collected
pursuant to the provisions stated below) shall be deposited in one or more bank accounts or
securities investment accounts, in form and substance reasonably satisfactory to Administrative
Agent subject to the terms of the Security Agreement and applicable Control Agreements.
(b) Each Borrowing Base Loan Party shall establish and maintain, at its sole expense,
blocked accounts, charged accounts, or lockboxes and related deposit accounts (in each case,
Blocked Accounts), which, on the Closing Date, shall consist of the accounts listed as such on
Schedule 9.01(b) and related lockboxes maintained by the financial institutions listed
on such schedule (or another financial institution acceptable to Administrative Agent), with
such banks as are acceptable to Administrative Agent into which each Loan Party shall promptly
deposit and direct their respective Account Debtors to directly remit all payments on Accounts
and all payments constituting proceeds of Inventory or other Collateral (other than proceeds of
a Casualty Event or an Asset Sale that do not require a repayment under Loan Documents, and
subject to the Intercreditor Agreement) in the identical form in which such payments are made,
whether by cash, check or other manner and shall be identified and segregated from all other
funds of the Loan Parties (except, with regard to accounts located in Europe, to the extent
permitted pursuant to the applicable U.K. Security Agreement, Swiss Security Agreement, or
German Security Agreement, or Control Agreements, or with respect to accounts located in any
other European country, the applicable
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Control Agreement or other Security Documents applicable thereto). Each Borrowing Base
Loan Party shall deliver, or cause to be delivered, to Collateral Agent a Control Agreement duly
authorized, executed and delivered by each bank where a Blocked Account for the benefit of any
Borrowing Base Loan Party is maintained, and, except as provided in Section 9.01(d), by
each bank where any other deposit account of a Borrowing Base Loan Party is from time to time
maintained. Each Borrowing Base Loan Party shall further execute and deliver such agreements
and documents as Administrative Agent may reasonably require in connection with such Blocked
Accounts and such Control Agreements. No Borrowing Base Loan Party shall establish any deposit
accounts after the Closing Date, unless such Loan Party has given the Administrative Agent 30
days (or such shorter period as may be determined by the Administrative Agent in its sole
discretion) prior written notice of its intention to establish such new account and has complied
in full with the provisions of this Section 9.01(b) with respect to such deposit
accounts. Each Borrowing Base Loan Party agrees that from and after the delivery of an
Activation Notice (as defined below), all payments made to such Blocked Accounts or other funds
received and collected by any Secured Party, whether in respect of the Accounts, as proceeds of
Inventory or other Collateral (subject to the Intercreditor Agreement) or otherwise shall be
treated as payments to the Secured Parties in respect of the Secured Obligations and therefore
shall constitute the property of the Secured Parties to the extent of the then outstanding
Secured Obligations and may be applied by the Administrative Agent in accordance with
Section 9.01(e).
(c) With respect to the Blocked Accounts of the U.S. Borrowers and such other Borrowing
Base Loan Parties as the Administrative Agent shall determine in its sole discretion, the
applicable bank maintaining such Blocked Accounts shall agree to forward daily all amounts in
each Blocked Account to one Blocked Account designated as a concentration account in the name
listed on Schedule 9.01(b) (the Concentration Account) at a bank acceptable to the
Administrative Agent that shall be designated as the Concentration Account bank for the Loan
Parties (the Concentration Account Bank), which, on the Closing Date, shall consist of the
accounts listed as such on Schedule 9.01(b) maintained by the financial institutions
listed on such schedule (or other financial institution acceptable to the Administrative Agent).
Each Bank providing a Blocked Account shall agree to follow the instructions of the Collateral
Agent with regard to each such Blocked Account, including the Concentration Account, including,
from and after the receipt of a notice (an Activation Notice) from the Collateral Agent (which
Activation Notice may (or shall, upon the written instruction of the Required Lenders) be given
by Collateral Agent at any time from and after the occurrence of a Cash Dominion Trigger Event
and prior to a Cash Dominion Recovery Event) pursuant to the applicable Control Agreement, to
follow only the instructions of the Collateral Agent (and not those of any Loan Party) with
respect to the Blocked Accounts (including the Concentration Account), including (i) to forward
daily all amounts in the Concentration Account to the account designated as the collection
account (the Collection Account), which shall be under the exclusive dominion and control of
the Collateral Agent (it being understood that, prior to the delivery of an Activation Notice,
the respective Loan Parties shall also be authorized to issue instructions with regard to funds
in the Concentration Account), and (ii) with respect to the Blocked Accounts to forward all
amounts in each Blocked Account to the applicable Collection Account or as the Collateral Agent
otherwise directs and to commence the process of daily sweeps from such Blocked Account into the
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Collection Account or otherwise under Section 9.01 or as the Collateral Agent
otherwise directs.
(d) Notwithstanding any provision of this Section 9.01 to the contrary, (A)
Borrowing Base Loan Parties may maintain zero balance disbursement accounts and accounts used
solely to fund payroll, payroll taxes or employee benefits in the ordinary course of business
that are not a part of the Cash Management Systems, provided that no Borrowing Base Loan
Parties shall accumulate or maintain cash in such accounts as of any date of determination in
excess of checks outstanding against such accounts as of that date and amounts necessary to meet
minimum balance requirements or Applicable Law and (B) Borrowing Base Loan Parties may maintain
local cash accounts that are not a part of the Cash Management Systems which individually do not
at any time contain funds in excess of $100,000 and, together with all other such local cash
accounts, do not exceed $2,000,000.
(e) From and after the delivery of an Activation Notice, unless an Event of Default has
occurred and is continuing (in which event Section 8.03 shall apply) and unless
Administrative Agent determines to release such funds to the Borrowers in accordance with the
following sentence, Administrative Agent shall apply all funds of a Borrower or Borrowing Base
Guarantor organized under the laws of the same jurisdiction of such Borrower that are in or are
received into a Collection Account or that are otherwise received under this Section
9.01 by the Administrative Agent or the Collateral Agent (except to the extent constituting
Pari Passu Priority Collateral or otherwise not required to be paid pursuant to Section
2.10) on a daily basis to the repayment of (i) first, Fees and reimbursable expenses of the
Administrative Agent and the Collateral Agent then due and payable by such Borrower and such
Borrowing Base Guarantors; (ii) second, to interest then due and payable on all Loans to such
Borrower, (iii) third, Overadvances to such Borrower, (iv) fourth, the Swingline Loans to such
Borrower, (v) fifth, Base Rate Loans to such Borrower, pro rata, (vi) sixth, Eurocurrency Loans
and EURIBOR Loans to such Borrower, pro rata, together with all accrued and unpaid interest
thereon; provided, however, that payments on such Eurocurrency Loans and EURIBOR
Loans with respect to which the application of such payment would