Execution Version
$350,000,000
Senior Secured Credit Facility
SIXTH AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
among
FRESHPET, INC.,
a Delaware corporation, as Borrower,
THE LENDERS FROM TIME TO TIME PARTY HERETO
and
CITY NATIONAL BANK,
as Lead Arranger and Agent
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Section 1.
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DEFINITIONS
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1 |
1.1
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Defined Terms
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1 |
1.2
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Other Definitional Provisions
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35
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1.3
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Leases
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36 |
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Section 2.
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AMOUNT AND TERMS OF LOANS AND LETTERS OF CREDIT; COMMITMENT AMOUNTS
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36 |
2.1
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Revolving Loans and Letters of Credit; Revolving
Loan Commitments
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36 |
2.2
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Delayed Draw Term Loans; Delayed Draw Term Loan
Commitment.
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38 |
2.3
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Optional Prepayments; Optional Commitment Reductions
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40 |
2.4
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Mandatory Prepayments
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41 |
2.5
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Conversion and Continuation Options
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44 |
2.6
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Minimum Amounts of Tranches; Minimum Borrowings
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44 |
2.7
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Interest Rates and Payment Dates
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45 |
2.8
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Computation of Interest and Fees
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45 |
2.9
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[Reserved].
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45 |
2.10
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Pro Rata Treatment and Payments
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46 |
2.11
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Illegality
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46 |
2.12
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Increased Costs
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47 |
2.13
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Taxes.
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48 |
2.14
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Indemnity
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51 |
2.15
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Mitigation of Costs
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52 |
2.16
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Unused Commitment Fee
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52 |
2.17
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Substitution of Lenders
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52 |
2.18
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Defaulting Lenders
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53 |
2.19
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Issuance of Letters of Credit.
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53 |
2.20
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[Reserved]
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56 |
2.21
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Swing Line Loans
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56 |
2.22
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Protective Advances.
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59 |
2.23
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Incremental Commitment.
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60 |
2.24
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Temporary Inability to Determine Rate
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62 |
2.25
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Benchmark Replacement Setting.
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62 |
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Section 3.
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REPRESENTATIONS AND WARRANTIES
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69
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3.1
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Financial Condition
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69 |
3.2
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Corporate Existence; Compliance with Law, Etc
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69 |
3.3
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Corporate Power; Authorization; Consents;
Enforceable Obligations
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69 |
3.4
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No Conflict
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70 |
3.5
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No Litigation
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70 |
3.6
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Ownership of Property; Liens; Condition of
Properties
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70 |
3.7
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Environmental Matters
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70 |
3.8
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Intellectual Property
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71 |
3.9
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Taxes
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71 |
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3.10
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Federal Regulations
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72 |
3.11
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ERISA Compliance
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72 |
3.12
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Investment Company Act
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72 |
3.13
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72 |
3.14
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Purpose of Loans and Letters of Credit.
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73 |
3.15
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Accuracy and Completeness of Information
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73 |
3.16
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Real Property Assets
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74 |
3.17
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Permits, Etc
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74 |
3.18
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Nature of Business
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74 |
3.19
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Capital Structure and Equity Ownership
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74 |
3.20
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Insolvency
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74 |
3.21
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Labor Matters
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74 |
3.22
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Condemnation
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75 |
3.23
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[Reserved].
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75 |
3.24
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Foreign Assets Control Regulations; Anti-Money
Laundering; Beneficial Ownership Certification.
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75 |
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Section 4.
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CONDITIONS PRECEDENT
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76 |
4.1
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Conditions to Closing Date
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76 |
4.2
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Conditions to Each Loan
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78 |
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Section 5.
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AFFIRMATIVE COVENANTS
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79 |
5.1
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Financial Statements
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79 |
5.2
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Certificates; Other Information
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80 |
5.3
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[Reserved].
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81 |
5.4
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Conduct of Business and Maintenance of Existence
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81 |
5.5
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Maintenance of Tangible Property; Insurance
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82 |
5.6
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Inspection of Property; Books and Records;
Discussions
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83 |
5.7
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Use of Proceeds
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83 |
5.8
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Hedging Obligations
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83 |
5.9
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[Reserved]
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83 |
5.10
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Lease and License Compliance; Landlord Consents
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83 |
5.11
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Environmental Laws
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84 |
5.12
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85 |
5.13
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Payment of Taxes.
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86 |
5.14
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Acquisition of Real Property Collateral
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86 |
5.15
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Cash Management.
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88 |
5.16
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Certain Post-Closing Obligations
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89 |
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Section 6.
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NEGATIVE COVENANTS
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90 |
6.1
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Financial Condition Covenants
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90 |
6.2
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Limitation on Indebtedness
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91 |
6.3
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Limitation on Liens
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92 |
6.4
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Limitation on Fundamental Changes
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94 |
6.5
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Limitation on Sale of Assets
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94 |
6.6
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Limitation on Restricted Payments
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94 |
6.7
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Limitation on Acquisitions, Investments, Loans
and Advances
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95 |
6.8
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Transactions with Affiliates.
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97 |
6.9
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Fiscal Year
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97 |
6.10
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Prohibitions on Certain Agreements,
Modifications to Certain Agreements
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97 |
6.11
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Sale-Leaseback Transactions
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98 |
6.12
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Line of Business
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98 |
6.13
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Anti-Terrorism Laws
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98 |
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Section 7.
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EVENTS OF DEFAULT
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99 |
7.1
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Events of Default
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99 |
7.2
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Application of Payments and Proceeds
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104 |
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Section 8.
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THE AGENT
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104 |
8.1
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Appointment
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104 |
8.2
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Delegation of Duties
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105 |
8.3
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Exculpatory Provisions
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105 |
8.4
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Reliance by Agent
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105 |
8.5
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Notice of Default
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106 |
8.6
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Non-Reliance on Agent and Other Lenders
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106 |
8.7
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Indemnification
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107 |
8.8
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Agent in Its Individual Capacity
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107 |
8.9
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Successor Agent
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107 |
8.10
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Administrative Agent May File Proofs of Claim
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108 |
8.11
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Collateral Matters
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108 |
8.12
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Lead Arranger
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109 |
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Section 9.
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CREATION OF SECURITY INTEREST
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109 |
9.1
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Grant of Security Interest
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109 |
9.2
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Negotiable Collateral
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109 |
9.3
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Collection of Accounts, General Intangibles, and
Negotiable Collateral
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109 |
9.4
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Filing of Financing Statements; Commercial Tort
Claims; Delivery of Additional Documentation Required.
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110 |
9.5
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111 |
9.6
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Right to Inspect
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111 |
9.7
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Control Agreements
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111
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Section 10.
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MISCELLANEOUS
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112 |
10.1
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Amendments and Waivers
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112 |
10.2
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Replacement of Holdout Lender
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113 |
10.3
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Notices
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113 |
10.4
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No Waiver; Cumulative Remedies
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115 |
10.5
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Survival of Representations and Warranties
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115 |
10.6
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Payment of Expenses; Indemnification
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115 |
10.7
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Successors and Assigns; Participation;
Purchasing Lenders
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116 |
10.8
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Adjustments; Set-Off
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119 |
10.9
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Counterparts
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120 |
10.10
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Severability
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120 |
10.11
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Integration
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120 |
10.12
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CHOICE OF LAW AND VENUE; JURY
TRIAL WAIVER; JUDICIAL REFERENCE PROVISION
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120
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10.13
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Acknowledgements
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124 |
10.14
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Headings
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124 |
10.15
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Confidentiality
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124 |
10.16
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Interest Rate Limitation
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125 |
10.17
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PATRIOT Act
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125 |
10.18
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Keepwell
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125 |
10.19
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Acknowledgement and Consent to Bail-In of Affected Financial Institutions.
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126 |
10.20
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Amendment and Restatement
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126 |
10.21
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Acknowledgement Regarding Any Supported QFCs
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127 |
10.22
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Revival and Reinstatement of Obligations;
Certain Waivers.
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128 |
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Exhibits |
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A-1
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Form of Revolving Note
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A-2
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Form of Delayed Draw Term Note
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A-3
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Form of Swing Line Note
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B
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Form of Continuation Notice
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C
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Form of Borrowing Notice
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D
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Form of Covenant Compliance Certificate
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E
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Form of Assignment and Acceptance
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F
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Form of Pricing Certificate
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Schedules |
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A.
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Commitments
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3.1
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Certain Off-Balance Sheet Items
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3.2
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Legal Names
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3.13
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3.16
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Real Property
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3.19
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Capital Structure and Equity Ownership
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5.15
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Cash Management Banks
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6.2
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Indebtedness
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6.3
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Liens
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SIXTH AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
This SIXTH AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT, made as of
February 19, 2021, by and among (1) FRESHPET,
INC., a Delaware corporation (the “
Borrower”), (2) the banks and other lenders from time to time party hereto (the “
Lenders”)
and (3) CITY NATIONAL BANK, a national banking association (“
CNB”), as lead arranger and administrative agent for the Lenders (in such capacity as administrative agent, together
with its successors and assigns in such capacity, the “
Agent”).
RECITALS
A. The Borrower, CNB, as the Agent and a Lender, and certain other Lenders, are parties to that certain Fifth
Amended and Restated Loan and Security Agreement, dated as of
April 17, 2020 (as amended, restated, supplemented, or otherwise modified from time to time prior to the date hereof, the “
Existing
Loan Agreement”), pursuant to which the Lenders party thereto, made available to Borrower (i) a revolving loan and letter of credit facility in the aggregate maximum principal amount of $35,000,000, with an aggregate outstanding
principal amount of $1,975,703.15 as of the date hereof, consisting entirely of Letter of Credit Usage (as defined in the Existing Loan Agreement), and (ii) delayed draw term loan facility in the aggregate maximum principal amount of $130,000,000,
with an aggregate outstanding principal amount of $0.00 as of the date hereof.
B. The Borrower has requested that the Existing Loan Agreement be amended and restated to (i) increase the revolving
loan and letter of credit facility to $50,000,000, (ii) increase the delayed draw term loan facility to $300,000,000 and (iii) make certain other changes to the Existing Loan Agreement as set forth herein.
C. The Agent and the Lenders have agreed to such requests, on the terms and subject to the conditions set forth
herein.
NOW, THEREFORE, in consideration of the premises herein contained and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto agree to amend and restate the Existing Loan Agreement as follows, without constituting a novation:
1.1 Defined Terms. As used in this Agreement, the following terms shall have the following meanings:
“Accountants”: any of the “Big Four”
independent certified public accounting firms or other nationally recognized or regionally-recognized independent accounting firm reasonably acceptable to the Agent.
“
Acquisition”: any transaction, or any
series of related transactions, consummated after the Closing Date, by which the Borrower and/or any of its
Subsidiaries directly or indirectly (a) acquires any division, any operating business unit, or any line of business or all or substantially
all of the assets of any firm, partnership, joint venture, limited liability company, corporation or division thereof, whether through purchase of assets, merger or otherwise, (b) acquires in one transaction or as the most recent transaction in a
series of transactions control of securities of a Person engaged in an ongoing business representing more than 50% of the ordinary voting power for the election of directors or other governing position if the business affairs of such Person are
managed by a board of directors or other governing body or (c) acquires control of more than 50% of the ownership interest in any partnership, joint venture, limited liability company, business trust or other Person that is not managed by a board of
directors or other governing body.
“
Adjusted EBITDA”: for Borrower and its
Subsidiaries on a consolidated basis, for the fiscal quarter most recently ended and the immediately preceding three fiscal quarters, the sum of (a) net income (or loss) for that period,
plus
(b) the aggregate amount of U.S. federal, state and local and non-U.S. taxes that are measured by income for that period (including distributions made pursuant to
Section 6.6(ii)),
plus (c) Interest Expense for that period,
plus (d) depreciation expense for that period,
plus (e) amortization expense for that period,
plus (f) non-recurring plant start-up costs in connection with
the Projects or other real property (including all buildings, fixtures, integrated equipment or other improvements located thereon) owned or leased by the Borrower for its pet food business operations in the United States, incurred in any period
beginning with the quarter ending
March 31, 2021, not to exceed $14,000,000 for all such costs added back pursuant to this clause (f) during the term of this Agreement,
plus,
(g) extraordinary, non-recurring or unusual costs, expenses or losses, in each case, acceptable to the Agent, not to exceed 20% of EBITDA for that period (or
less extraordinary,
non-recurring or unusual gains),
plus (h) any non-cash expense associated with compensation in the form of Capital Stock paid to employees, officers and directors of the
Borrower and its
Subsidiaries,
plus (i) any costs or expenses incurred pursuant to any stock option plan or any other management or employee benefit plan, agreement or any stock
subscription or stockholders agreement, in each case set forth in
clauses (b) through
(i) without
duplication and to the extent deducted in the calculation of net income. For the avoidance of doubt, calculation of Adjusted EBITDA (i) shall not include addbacks for any lost revenue related to the COVID-19 global pandemic or other epidemiological
conditions (such as downturns in the financial markets or pandemics) and (ii) shall exclude income or gains resulting from grants or forgiveness of any loans made pursuant to any program offered by Governmental Authorities in response to
circumstances resulting from the COVID-19 virus, including without limitation, programs offered under the Coronavirus Aid, Relief, and Economic Security Act, and including the Paycheck Protection Program. The Borrower shall provide to the Agent,
upon request, back-up documentation regarding the foregoing add-backs, reasonably acceptable to the Agent.
“Affected Financial Institution”: (a) any EEA
Financial Institution or (b) any UK Financial Institution.
“
Affiliate”: as to any Person, (a) any other
Person (other than a Subsidiary) which, directly or indirectly, is in control of, is controlled by, or is under common control with, such Person or (b) any Person who is a director, officer, shareholder, member or partner (i) of such Person, (ii) of
any Subsidiary of such Person or (iii) of any Person described in the preceding clause (a). For purposes of this definition,
“control” of a Person means the power, directly or indirectly, either to (i) vote securities having 10% or more of the
ordinary voting power for the election of directors or managers of such Person or (ii) direct or cause the direction of the management and policies of such Person whether by
contract or otherwise.
“Agent”: as defined in the preamble hereto.
“Aggregate Delayed Draw Term Loan Commitment”:
$300,000,000, as the same may be adjusted pursuant to the provisions hereof.
“Aggregate Revolving Loan Commitment”:
$50,000,000, as the same may be adjusted pursuant to the provisions hereof.
“Aggregate Total Commitment”: on any date of
determination, collectively, the sum of the Aggregate Delayed Draw Term Loan Commitment and the Aggregate Revolving Loan Commitment.
“Aggregate Total Commitment Percentage”:
with respect to each Lender, the percentage equivalent of the ratio which such Lender’s Commitments bears to the Aggregate Total Commitment.
“Agreement”: this Sixth Amended and Restated
Loan and Security Agreement, as amended, restated, supplemented or otherwise modified from time to time.
“Anti-Terrorism Laws”: any Requirements of
Law relating to terrorism or money laundering, including Executive Order No. 13224, the PATRIOT Act, the Bank Secrecy Act, the Money Laundering Control Act of 1986 (i.e., 18 U.S.C. §§ 1956 and 1957), the Requirements of Law administered by OFAC, and
all Requirements of Law comprising or implementing these laws.
“Applicable Margin”: with respect to
Revolving Loans and Delayed Draw Term Loans:
(i) if the Total Funded Debt Ratio as of the fiscal quarter most recently ended (for which the Agent has received the financial statements and Covenant Compliance Certificate required by Sections 5.1
and 5.2(a)) is equal to or greater than 3.25:1.00 (“Leverage Level 1”), 3.25% per annum (in the case of LIBOR Loans) and 2.25% per annum (in the case of Base Rate Loans);
(ii) if the Total Funded Debt Ratio as of the fiscal quarter most recently ended (for which the Agent has received the financial statements and Covenant Compliance Certificate required by Sections 5.1
and 5.2(a)) is less than 3.25:1.00, but equal to or greater than 2.50:1.00 (“Leverage Level 2”), 2.75% per annum (in the case of LIBOR Loans) and 1.75% per annum (in the case
of Base Rate Loans);
(iii) if the Total Funded Debt Ratio as of the fiscal quarter most recently ended (for which the Agent has received the financial statements and Covenant Compliance Certificate required by Sections 5.1
and 5.2(a)) is less than 2.50:1.00, but equal to or greater than 1.75:1.00 (“Leverage Level 3”), 2.25% per annum (in the case of LIBOR Loans) and 1.25% per annum (in the case
of Base Rate Loans); and
(iv) if the Total Funded Debt Ratio as of the fiscal quarter most recently ended (for which the Agent has received the financial statements and Covenant Compliance Certificate required by Sections 5.1
and 5.2(a)) is less than 1.75:1.00 (“Leverage Level 4”), 1.75% per annum (in the case of LIBOR Loans) and 0.75% per annum (in the case of Base Rate Loans).
Notwithstanding the foregoing or any provision herein to the contrary, during the period from and including the
Closing Date through and including the date that is five (5) Business Days after receipt by the Agent of the financial statements and related Covenant Compliance Certificate referred to in
Sections
5.1 and
5.2(a) with respect to the period ending
March 31, 2021, the Applicable Margin for each Type of Revolving Loan and Delayed Draw Term Loan shall be set at
Leverage Level 4. Thereafter, the Applicable Margin for Revolving Loans and Delayed Draw Term Loans is subject to change following receipt by the Agent of a Pricing Certificate pursuant to
Section
2.7(d).
“
Asset Disposition”: the sale, sale and
leaseback, transfer, conveyance, exchange, long-term lease accorded sales treatment under GAAP or similar disposition (including by means of a merger, consolidation, amalgamation, joint venture or other substantive combination) of any of the
properties, business or assets (other than cash and Cash Equivalents, but including the assignment of any lease, license or permit relating to any property) of the Borrower or any of its
Subsidiaries to any Person or Persons;
provided that Asset Dispositions shall not include any of the following:
(a) the sale of inventory in the ordinary course of business;
(b) dispositions of assets or property (x) between or among the Loan Parties or (y) by a Subsidiary to a Loan Party, to the extent (i) any resulting investment constitutes an investment permitted
pursuant to Section 6.7, (ii) the foregoing constitutes a distribution permitted pursuant to Section 6.6,
or (iii) the foregoing constitutes a transaction permitted by Section 6.4;
(c) dispositions in the ordinary course of business constituting the sale or discount of accounts receivable reasonably in connection with the collection or compromise thereof;
(d) the disposition of equipment that is substantially damaged, obsolete or worn-out in the ordinary course of business or no longer used or useful;
(e) the use or transfer of money or Cash Equivalents in the ordinary course of business, in a manner that is not prohibited by the terms of this Agreement or the other Loan Documents;
(f) the licensing, on a non-exclusive basis, of patents, trademarks, copyrights, and other intellectual property rights in the ordinary course of business, or the lapse of intellectual property that is
immaterial or no longer used in or necessary to its business;
(g) trade-ins of assets to the extent that (i) such property is exchanged for credit against the purchase price of replacement property or (ii) the proceeds of such disposition are promptly applied to
the purchase price of replacement property;
(h) the sale or issuance by (x) the Borrower of its own Capital Stock, to the extent that any such disposition does not result in a Change of Control or (y) any Subsidiary of its own Capital Stock, to
the extent that (i) any resulting investment constitutes an investment permitted pursuant to Section 6.7 and (ii) such disposition is not prohibited by the terms of this
Agreement;
(i) the granting of a Lien permitted pursuant to Section 6.3;
(j) dispositions resulting from property loss events or takings and transfers of property that has suffered a property
loss event or a taking (constituting a total loss or constructive total loss of such property) upon receipt of the Net Proceeds of such property loss event or taking;
(k) mergers or consolidations permitted by Section 6.4, Restricted Payments permitted by Section 6.6, and Investments permitted
by Section 6.7; and
(l) any other disposition of property; provided that the aggregate consideration received during any fiscal year of the Borrower
for all such dispositions shall not exceed $1,000,000.
“Assignment and Acceptance”: an Assignment
and Acceptance in the form of Exhibit E to this Agreement.
“Available Delayed Draw Term Loan Commitment”:
with respect to each Delayed Draw Lender on the date of determination thereof, the amount by which (a) the Delayed Draw Term Loan Commitment of such Lender on such date exceeds (b) the principal sum of such Lender’s Delayed Draw Term Loans
outstanding.
“Available Revolving Loan Commitment”: with
respect to each Revolving Loan Lender on the date of determination thereof, the amount by which (a) the Revolving Loan Commitment of such Lender on such date exceeds (b) the principal sum of (i) such Lender’s Revolving Loans outstanding, and (ii) the
amount obtained by multiplying such Lender’s Revolving Loan Commitment Percentage by the aggregate Letter of Credit Amount of all Letters of Credit outstanding, all Swing Line Loans outstanding and the aggregate amount of unreimbursed drawings under
all Letters of Credit on such date.
“Bail-In Action”: the exercise of any
Write-Down and Conversion Powers by the applicable Resolution Authority in respect of any liability of an Affected Financial Institution.
“Bail-In Legislation”: (a) with respect to
any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law, regulation rule or requirement for such EEA Member Country from time to time which is
described in the EU Bail-In Legislation Schedule and (b) with respect to the United Kingdom, Part I of the United Kingdom Banking Act 2009 (as amended from time to time) and any other law, regulation or rule applicable in the United Kingdom relating
to the resolution of unsound or failing banks, investment firms or other financial institutions or their affiliates (other than through liquidation, administration or other insolvency proceedings).
“Bankruptcy Code”: Title 11 of the United
States Code entitled “Bankruptcy,” as now and hereafter in effect, or any successor statute.
“Base Rate”: for any day, a rate per annum
equal to the greater of (x) the Federal Funds Effective Rate in effect on such day plus ½ of 1% per annum, (y) subject to Section 2.25, the LIBOR Adjusted Rate (which rate shall be calculated based upon an Interest Period of 1 month and shall be
determined on a daily basis), plus 1 percentage point, and (z) a fluctuating per annum rate of interest equal at all times to the rate of interest in effect for such day as announced from time to time by CNB as its “prime rate” as of such date; provided that if Base Rate shall be less than 0%, such rate shall be deemed to be 0% for all purposes under this Agreement. The Base Rate is a reference rate and does not
necessarily represent the lowest or best rate actually charged to any customer. The Agent may make commercial loans or other loans at rates of interest at, above or below the Base Rate. If, for any reason, the Agent shall have determined (which
determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate for any reason, including the inability or failure of the Agent to obtain sufficient quotations in accordance with the terms
hereof, the Base Rate shall be determined without regard to clause (x) of the first sentence of this definition until the circumstances giving rise to such inability no longer exist. Any change in the Base Rate due to a change in the Federal Funds
Effective Rate or the “Prime Rate”, as the case may be, shall be effective on the effective date of such change in the Federal Funds Effective Rate or the “Prime Rate”, as applicable.
“Base Rate Loans”: Loans the rate of
interest applicable to which is based upon the Base Rate.
“Beneficial Ownership Certification”: a
certification regarding beneficial ownership required by the Beneficial Ownership Regulation.
“Beneficial Ownership Regulation”: 31 C.F.R.
§ 1010.230, as amended from time to time, and any successor regulation or statute.
“Blocked Person”: a Person (a) listed in the
annex to, or is otherwise subject to the provisions of, Executive Order No. 13224, (b) majority 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, Executive
Order No. 13224, (c) with which the Agent or any Lender is prohibited from dealing or otherwise engaging in any transaction by any Anti-Terrorism Law, (d) that commits, threatens or conspires to commit or supports “terrorism” as defined in Executive
Order No. 13224 or (e) that is named a “specially designated national” or “blocked person” on the most current list published by OFAC or other similar list.
“
Books”: all of Borrower’s and its
Subsidiaries’ now owned or hereafter acquired books and records (including all of their Records indicating, summarizing, or evidencing their assets (including the Collateral) or liabilities, all of Borrower’s and its
Subsidiaries’ Records relating to
their business operations or financial condition, and all of their Goods or General Intangibles related to such information).
“Borrower”: as defined in the preamble
hereto.
“Borrower Collateral”: all of Borrower’s now
owned or hereafter acquired right, title, and interest in and to each of the following:
(c) all of its Commercial Tort Claims,
(d) all of its Deposit Accounts,
(e) all of its Equipment,
(f) all of its General Intangibles, including without limitation, Intellectual Property,
(g) all of its Inventory,
(h) all of its Investment Property (including all of its securities and Securities Accounts),
(i) all of its Negotiable Collateral,
(j) all of its Supporting Obligations,
(k) Money or other assets of Borrower that now or hereafter come into the possession, custody, or control of any Secured Party, and
(l) the proceeds and products, whether tangible or intangible, of any of the foregoing, including proceeds of insurance covering any or all of the foregoing, and any and all Accounts, Books, Deposit
Accounts, Equipment, General Intangibles, Inventory, Investment Property, Negotiable Collateral, Real Property, Supporting Obligations, Money, or other tangible or intangible property resulting from the sale, lease, license, exchange, collection,
or other disposition of any of the foregoing, or any portion thereof or interest therein, and the proceeds thereof; provided that “Borrower Collateral” shall not include the
Excluded Property; provided, further, that if and when any property shall cease to be Excluded
Property, “Borrower Collateral” shall include such property and a Lien on and security interest in such property shall be deemed granted therein.
“Borrowing Notice”: a notice from the
Borrower to the Agent requesting a borrowing of Loans, substantially in the form of Exhibit C attached hereto.
“Business Day”: a day other than a Saturday,
Sunday or other day on which commercial banks in the State of New York or California are authorized or required by law to close and which, in the case of a LIBOR Loan, is a Eurodollar Business Day.
“Canadian Subsidiary”: Professor Connors
Canada, Inc., a company organized under the laws of the province of Ontario.
“Canadian Subsidiary Dissolution”: means any
of the consolidation, combination or merger of the Canadian Subsidiary with and into Borrower or the liquidation, wind up, dissolution or other similar transaction reasonably approved by the Agent, of the Canadian Subsidiary (in each case, including
any similar transaction under local law governing of such Subsidiary); provided, that if the aggregate Net Proceeds received from all such transactions are in an amount greater than $1,000,000, the remaining assets of the Canadian Subsidiary (if any)
and any proceeds of any of the foregoing shall be transferred to Borrower.
“
Capital Expenditures”: means, with respect
to any Person for any period, the aggregate of all expenditures by such Person and its
Subsidiaries during such period that are capital expenditures as determined in accordance with GAAP, whether such expenditures are paid in cash or financed
excluding (a) interest capitalized during such period, (b) any expenditure described above to the extent such expenditure is part of the aggregate amounts payable as consideration for any Permitted Acquisition consummated during or prior to such
period, (c) to the extent permitted by this Agreement, the Net Proceeds of any Asset Disposition used or contractually committed to be so used by Borrower or any of its
Subsidiaries in accordance with
Section 2.4(b), (d) expenditures of proceeds of insurance settlements, condemnation awards and other settlements in respect of lost, destroyed, damaged or condemned assets, equipment or other property to the
extent such expenditures are made to replace or repair such lost, destroyed, damaged or condemned assets, equipment or other property or otherwise to acquire, maintain, develop, construct, improve, upgrade or repair assets or properties useful in the
business of Borrower and the
Subsidiaries, (e) expenditures that are accounted for as capital expenditures of such person and that actually are paid for by, or for which Borrower or any Subsidiary receives reimbursement in cash from, a third party
and for which none of Borrower or any Subsidiary has provided or is required to provide or incur, directly or indirectly, any consideration or obligation to such third party or any other person (whether before, during or after such period), and (f)
other expenditures that Agent determines in its discretion to exclude from this definition of
“Capital Expenditures”.
“Capitalized Lease Obligations”: obligations
for the payment of rent for any real or personal property under leases or agreements to lease that, in accordance with GAAP, have been or should be capitalized on the books of the lessee and, for purposes hereof, the amount of any such obligation
shall be the capitalized amount thereof determined in accordance with GAAP.
“Capital Stock”: any and all shares,
interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership interests in a Person (other than a corporation), any and all warrants, options or rights to purchase or any other
securities convertible into any of the foregoing.
“Cash Collateral Deposit”: cash deposits
made by the Borrower to the Agent to be held by the Agent as Collateral pursuant hereto or pursuant to such other security documentation as the Agent shall request, for the reimbursement of drawings under Letters of Credit and to the Swing Line
Lender for reimbursement of Swing Line Loans.
“Cash Equivalents”: means (a) marketable
direct obligations issued by, or unconditionally guaranteed by, the United States or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within 1 year from the date of acquisition thereof,
(b) marketable direct obligations issued by any state of the United States or any political subdivision of any such state or any public instrumentality thereof maturing within 1 year from the date of acquisition thereof and, at the time of
acquisition, having one of the two highest ratings obtainable from either Standard & Poor’s Rating Group (“S&P”) or Moody’s Investor Service, Inc. (“Moody’s”), (c) commercial paper maturing no more than 270 days from the date of creation thereof and, at the time of acquisition, having a rating of at least A-1 from S&P or at
least P-1 from Moody’s, (d) certificates of deposit or bankers’ acceptances maturing within 1 year from the date of acquisition thereof issued by any bank organized under the laws of the United States or any state thereof having at the date of
acquisition thereof combined capital and surplus of not less than $250,000,000, (e) Deposit Accounts maintained with (i) any bank that satisfies the criteria described in clause (d) above, or (ii) any other bank organized under the laws of the United
States or any state thereof so long as the amount maintained with any such other bank is less than or equal to $100,000 and is insured by the Federal Deposit Insurance Corporation, and (f) Investments in money market funds substantially all of whose
assets are invested in the types of assets described in clauses (a) through (e) above.
“Cash Management Account”: as defined in Section 5.15(a) hereof.
“Cash Management Bank”: as defined in Section
5.15 hereof.
“Cash Management Obligations”: obligations
of the Loan Parties to any Eligible Counterparty under one or more credit cards, debit cards, cash management agreements, deposit account agreements, treasury agreements, sweep agreements or similar agreements pertaining to cash management services,
including without limitation, automated clearing house services.
“CFC” means any Subsidiary of a Loan Party
that is a controlled foreign corporation (as that term is defined in Section 957 of the Code) the dividends of which are not entitled to the dividends received deduction under Section 245A of the Code.
“CFC Holdco” means any Subsidiary of a Loan
Party substantially all of the assets of which consist of the Capital Stock (including, for this purpose, any debt or other instrument treated as equity for U.S. federal income tax purposes) or Capital Stock and indebtedness of any CFC or any other
CFC Holdco.
“Change in Law”: the occurrence, after the
date of this Agreement, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application
thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided
that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules,
guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel
III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.
“
Change of Control”: (a) any Person or two
or more Persons acting in concert, shall have acquired beneficial ownership, directly or indirectly, of Capital Stock of Borrower (or other securities convertible into such Capital Stock) representing 35% or more of the combined voting power of all
Capital Stock of Borrower entitled (without regard to the occurrence of any contingency) to vote for the election of members of the board of directors or other governing body of Borrower; (b) any Person or two or more Persons acting in concert, shall
have acquired by
contract or otherwise, or shall have entered into a
contract or arrangement that, upon consummation thereof, will result in its or their acquisition of the power to exercise, directly or indirectly, a controlling influence over the
management or policies of Borrower or control over the Capital Stock of such Person entitled to vote for members of the board of directors or other governing body of Borrower on a fully-diluted basis (and taking into account all such Capital Stock
that such Person or group has the right to acquire pursuant to any option right) representing 35% or more of the combined voting power of such Capital Stock; or (c) Borrower shall cease to hold 100% of the Capital Stock and voting power of each of
its
Subsidiaries that is a Guarantor (other than in connection with any transaction permitted pursuant to
Section 6.4).
“Chillers”: a refrigerated unit out of which
Borrower’s products are sold.
“
Closing Date”: the date on which the
conditions set forth in
Sections 4.1 and
4.2 are satisfied and the initial Loan is made, which date is
February 19, 2021.
“Code”: the U.S. Internal Revenue Code of
1986, as amended from time to time.
“Collateral”: all of the property (tangible
or intangible) subject to or purported to be subject to the lien or security interest purported to be created by any Loan Document as security for all or part of the Obligations, including without limitation, the Borrower Collateral.
“Collateral Documents”: each Guaranty, each
Guarantor Security Agreement, the Stock Pledge Agreement, the Mortgages, each Intellectual Property Security Agreement, any Control Agreements and all other instruments, documents and agreements encumbering the Collateral or evidencing or perfecting
a security interest therein for the benefit of the Secured Parties, as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with the terms hereof and thereof.
“Collections”: all cash, checks, notes,
instruments, and other items of payment (including insurance proceeds, proceeds of cash sales, rental proceeds, and tax refunds).
“Commitment”: a Revolving Loan Commitment or
a Delayed Draw Term Loan Commitment, as applicable.
“Commitment Increase Notice”: as defined in
Section 2.23(a) hereof.
“Commodity Exchange Act”: the Commodity
Exchange Act (7 U.S.C. § 1 et seq.) as amended from time to time, and any successor statute.
“Continuation Notice”: a request for
continuation or conversion of a Loan as set forth in Section 2.5, substantially in the form of Exhibit B attached hereto.
“Contractual Obligation”: as to any Person,
any provision of any security issued by such Person or of any agreement, instrument or other undertaking to which such Person is a party or by which it or any of its property is bound.
“Control Agreement”: a control agreement,
restricted account agreement or similar agreement or document, in each case in form and substance reasonably satisfactory to the Agent and entered into for the purpose of perfecting a security interest in one or more Securities Accounts, Deposit
Accounts, electronic Chattel Paper, Investment Property, and Letter-of-Credit Rights of the Loan Parties.
“Correct Applicable Margin”: as defined in Section 2.7(e) hereof.
“Covenant Compliance Certificate”: a
certificate of a Responsible Officer or other senior officer of the Borrower substantially in the form of Exhibit D attached hereto.
“Debt Offering”: the incurrence, sale or
issuance by the Borrower or any Subsidiary of any debt securities or other Indebtedness of the type referred to in clauses (i) or (iii) of the definition of Indebtedness in this Section
1.1, other than any Indebtedness permitted by Section 6.2.
“
Debt Service”: for the Borrower and its
Subsidiaries on a consolidated basis, for the fiscal quarter most recently ended and the immediately preceding three fiscal quarters, without duplication, the sum of (a) Interest Expense of the Borrower and its
Subsidiaries for such period paid or
required to be paid in cash
plus (b) the aggregate amount of scheduled principal payments made on Total Funded Debt for such period.
“Default”: any of the events specified in Section 7.1, whether or not any requirement for the giving of notice, the lapse of time, or both, or any other condition, has been satisfied.
“Defaulting Lender”: any Lender that (a) has
failed to fund any portion of the Loans required to be funded by it, (b) has failed to pay over to Agent or any other Lender any other amount required to be paid by it hereunder within three (3) Business Days of the date when due, unless the subject
of a good faith dispute, (c) has notified the Borrower or the Agent in writing or has made a public statement to the effect that it does not intend or expect to comply with its funding obligations under this Agreement or generally under other
agreements in which it commits to extend credit, (d) is or becomes (or whose parent company is or becomes) the subject of a bankruptcy, insolvency, receivership or conservatorship proceeding, or has had a receiver, conservator, trustee or custodian
appointed for it, or (e) becomes the subject of a Bail-in Action; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of an
ownership interest in such Lender or parent company thereof or the exercise of control over a Lender or parent company thereof by a governmental authority or instrumentality thereof.
“Delayed Draw Lender”: each Lender having
(i) a Delayed Draw Term Loan Commitment or (ii) Delayed Draw Term Loans outstanding.
“Delayed Draw Term Loan”: as defined in Section 2.2(a) hereof.
“Delayed Draw Term Loan Commitment”: the
commitment of a Lender to make a Delayed Draw Term Loan hereunder as set forth on Schedule A hereof, as the same may be adjusted pursuant to the provisions hereof.
“
Delayed Draw Term Loan Commitment Expiration Date”:
August 19, 2023, or such earlier date as such Commitment shall expire or be terminated or the Delayed Draw Term Loans shall become due and payable in accordance with the terms hereof (whether pursuant to
Section 7.1 or otherwise).
“Delayed Draw Term Loan Commitment Percentage”:
with respect to each Delayed Draw Lender, the percentage equivalent of the ratio which such Lender’s Delayed Draw Term Loan Commitment bears to the Aggregate Delayed Draw Term Loan Commitment.
“
Delayed Draw Term Loan Maturity Date”:
February 19, 2026, or such earlier date as the Delayed Draw Term Loans shall become due and payable in accordance with the terms hereof (whether pursuant to
Section 7.1 or
otherwise).
“Delayed Draw Term Note”: as defined in Section 2.2(c) hereof.
“Delayed Draw Term Reduction Installment”:
prior to the Secondary Conversion Date, the Initial DDTL Reduction Installment, and thereafter the Secondary DDTL Reduction Installment.
“
Division/Series Transaction”: with respect
to the Loan Parties and their
Subsidiaries, that any such Person (a) divides into two or more Persons (whether or not the original Loan Party or Subsidiary thereof survives such division) or (b) creates, or reorganizes into, one or more series, in
each case as contemplated under the laws of any jurisdiction.
“Dollars” and “$”: dollars in lawful currency of the United States.
“Dutch Subsidiary”: Freshpet NE B.V., a
company organized under the laws of Netherlands.
“
EBITDA”: for the Borrower and its
Subsidiaries, on a consolidated basis, without duplication, with respect to any period, the sum of (a) net income (or loss) for that period,
plus (b) to the extent deducted in
the calculation of net income, the aggregate amount of U.S. federal, state and local and non-U.S. taxes, in each case, that are measured by income for that period,
plus (c)
Interest Expense for that period,
plus (d) depreciation expense for that period,
plus (e) amortization
expense for such period.
“EEA Financial Institution”: (a) any credit
institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a)
of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
“EEA Member Country”: any of the member
states of the European Union, Iceland, Liechtenstein, and Norway.
“EEA Resolution Authority”: any public
administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
“Eligible Counterparty”: the Agent, any
Affiliate of the Agent, any Lender and any Affiliate of any Lender, in each case, that from time to time enters into a Lender Hedging Agreement or Cash Management Obligation with the Borrower or any Subsidiary thereof; provided, the term “Eligible Counterparty” shall include any Person that is the Agent, an Affiliate of the Agent, a Lender or an Affiliate of a Lender as of the Closing Date or as of the date that such
Person enters into a Lender Hedging Agreement or Cash Management Obligation, as applicable, but subsequently ceases to be the Agent, an Affiliate of the Agent, a Lender or an Affiliate of a Lender, as the case may be.
“
Environmental Actions”: any complaint,
summons, citation, notice, directive, order, claim, litigation, investigation, judicial or administrative proceeding, judgment, letter, or other communication from any Governmental Authority, or any third party alleging violations of Environmental
Laws or releases of Hazardous Substances from (a) any assets, properties, or businesses of Borrower, its
Subsidiaries, or any of their predecessors in interest, or (b) from or onto any facilities which received Hazardous Substances generated by
Borrower, its
Subsidiaries, or any of their predecessors in interest.
“Environmental Indemnity”: with respect to
any Real Property, an environmental indemnity agreement (whether provided as a separate document or included in another document required to be delivered to the Agent pursuant to this Agreement or any other Loan Document in connection with such Real
Property), executed by the Loan Parties, in form and substance reasonably satisfactory to the Agent.
“Environmental Laws”: all federal, state,
provincial, foreign and local laws, rules and regulations governing (a) environmental matters, (b) the generation, use, control, removal, storage, transportation, spill, release or discharge of Hazardous Substances and (c) as it relates to exposure
to Hazardous Substances, occupational safety and health, industrial hygiene, or the protection of human, plant or animal health, including without limitation as provided in the provisions of and the regulations under (i) the Comprehensive
Environmental Response, Compensation and Liability Act of 1980 (42 U.S.C. §§9601 et seq.), (ii) the Solid Waste Disposal Act (42 U.S.C. §§6901 et seq.), (iii) the Clean Air Act (42 U.S.C. §§7401 et seq.), (iv) the Hazardous Materials Transportation
Act (49 U.S.C. §§1801 et seq.), (v) the Resource Conservation and Recovery Act of 1976 (42 U.S.C. §§6901 et seq.), (vi) the Federal Water Pollution Control Act (33 U.S.C. §§1251 et seq.), (vii) the Safe Drinking Water Act (42 U.S.C. §§3000(f) et
seq.), (viii) the Oil Pollution Act of 1990 (33 USC §2701 et seq.), (ix) the Emergency Planning and the Community Right-to-Know Act of 1986 (42 USC §11001 et seq.), (x) the Occupational Safety and Health Act (29 USC §651 et seq.), to the extent it
regulates occupational exposure to Hazardous Substances, and (xi) the Toxic Substances Control Act (15 U.S.C. §§2601 et seq.), any state and local or foreign counterparts or equivalents, all as heretofore or hereafter amended.
“Environmental Liabilities and Costs”: all
liabilities, monetary obligations, losses, damages, punitive damages, consequential damages, treble damages, costs and expenses (including all reasonable fees, disbursements and expenses of counsel, experts, or consultants, and costs of investigation
and feasibility studies), fines, penalties, sanctions, and interest incurred as a result of any claim or demand, or Remedial Action required, by any Governmental Authority or any third party, and which arise from any Environmental Action.
“Environmental Lien”: any Lien in favor of
any Governmental Authority for Environmental Liabilities and Costs.
“Equipment”: Equipment (as that term is
defined in the UCC) and includes machinery, machine tools, motors, furniture, furnishings, fixtures, vehicles (including motor vehicles), computer hardware, tools, parts, and goods (other than consumer goods, farm products, or Inventory), wherever
located, including all attachments, accessories, accessions, replacements, substitutions, additions, and improvements to any of the foregoing.
“Equityholder Agreements”: each shareholder
agreement, member agreement, partner agreement, voting agreement, buy-sell agreement, option, warrant, put, call, right of first refusal, and other agreement or instrument governing the equity of any Loan Party or any other security with conversion
rights into equity of any Loan Party.
“Equity Offering”: the sale or issuance (or
reissuance) by the Borrower or any Subsidiary of any Capital Stock or beneficial interests (common stock, preferred stock, partnership interests, member interests or otherwise) or any options, warrants, convertible securities or other rights to
purchase such Capital Stock or beneficial interests.
“ERISA”: the Employee Retirement Income
Security Act of 1974, as amended from time to time.
“ERISA Affiliate”: as to any Person, each
trade or business including such Person, whether or not incorporated, which together with such Person would be treated as a single employer under Sections 414(b) or (c) of the Code, or, solely with respect to Section 412 of the Code, Sections 414(m)
or (o) of the Code.
“EU Bail-In Legislation Schedule”: the EU
Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.
“Eurodollar Business Day”: any day on which
banks are open for dealings in Dollar deposits in the London interbank market.
“Event of Default”: as defined in Section 7.1 hereof.
“
Excess Cash Flow”: for the Borrower and its
Subsidiaries on a consolidated basis, with respect to the fiscal year of the Borrower ending on
December 31, 2020, and each fiscal year thereafter, without duplication, the sum of (a) EBITDA for such period,
minus (b) cash Interest Expense and aggregate cash amount of any premium, make-whole or penalty payments paid during such period,
minus (c)
the aggregate principal amount of scheduled payments on any Indebtedness of the Borrower or any Subsidiary and Cash Collateral Deposits with respect to outstanding Letters of Credit, in each case made during such period,
minus (d) unfinanced (other than with the proceeds of revolving borrowings) Capital Expenditures made in cash by the Borrower and its
Subsidiaries during such period to the extent not prohibited by this
Agreement,
minus (e) aggregate amount of U.S. federal, state and local and non-U.S. taxes that are paid in cash during such period (including distributions made pursuant to
Section 6.6(ii)).
“Exchange Act”: the Securities Exchange Act
of 1934, as in effect from time to time.
“Excluded Deposit Accounts”: (a) Deposit
Accounts the balance of which consists exclusively of withheld income taxes and federal, state or local employment taxes, (b) all Deposit Accounts constituting (and the balance of which consists solely of funds set aside in connection with) payroll
accounts, trust or fiduciary accounts, and accounts dedicated to the payment of accrued employee benefits, medical, dental and employee benefits claims to employees of any Loan Party, (c) zero balance disbursement accounts and (d) other Deposit
Accounts maintained in the ordinary course of business containing cash amounts that do not exceed at any time $250,000 for any such account and $500,000 in the aggregate for all such accounts under this clause (d).
“Excluded Prepayment Amount”: as defined in
Section 2.7(g).
“
Excluded Property”: (i) (A) that portion of
the outstanding Capital Stock of any CFC or CFC Holdco that is a direct Subsidiary of a Loan Party, which exceeds an aggregate of 65% of the total combined voting power of all classes of the Capital Stock of such CFC or CFC Holdco entitled to vote
(within the meaning of Treasury Regulation Section 1.956-2(c)(2) or any successor regulation thereto);
provided that, Excluded Property shall not include, and Collateral shall
include, 100% of each class of Capital Stock of any such CFC or CFC Holdco not entitled to vote (within the meaning of Treasury Regulation Section 1.956-2(c)(2) or any successor regulation thereto), (B) any Capital Stock of any direct or indirect
Subsidiary of a CFC or CFC Holdco and (C) any assets of any Excluded Subsidiary, (ii) any rights or interest in any
contract, lease, permit, license, or license agreement covering real or personal property of Borrower if under the terms of such
contract, lease, permit, license, or license agreement, or applicable law with respect thereto, the grant of a security interest or Lien therein is prohibited as a matter of law or under the terms of such
contract, lease, permit, license, or license
agreement and such prohibition or restriction has not been waived or the consent of the other party to such
contract, lease, permit, license, or license agreement has not been obtained (
provided,
that, (A) the foregoing exclusions of this clause (ii) shall in no way be construed (1) to apply to the extent that any described prohibition or restriction is unenforceable under Section 9-406, 9-407, 9-408, or 9-409 of the UCC or other applicable
law, or (2) to apply to the extent that any consent or waiver has been obtained that would permit Agent’s security interest or Lien notwithstanding the prohibition or restriction on the pledge of such
contract, lease, permit, license, or license
agreement and (B) the foregoing exclusions of clauses (i) and (ii) shall in no way be construed to limit, impair, or otherwise affect any of Agent’s, any other Secured Party’s continuing security interests in and Liens upon any rights or interests of
Borrower in or to (1) monies due or to become due under or in connection with any described
contract, lease, permit, license, license agreement, or Capital Stock (including any Accounts or Capital Stock), or (2) any proceeds from the sale, license,
lease, or other dispositions of any such
contract, lease, permit, license, license agreement, or Capital Stock) and (iii) any United States intent-to-use trademark applications to the extent that, and solely during the period in which, the grant of a
security interest therein would impair the validity or enforceability of such intent-to-use trademark applications under applicable federal law;
provided that upon submission
and acceptance by the United States Patent and Trademark Office of an amendment to allege use pursuant to 15 U.S.C. Section 1060(a) (or any successor provision), such intent-to-use trademark application shall not be considered Excluded Property.
“Excluded Subsidiary” means any Subsidiary of
a Loan Party that is a CFC, a CFC Holdco or a direct or indirect Subsidiary of a CFC or CFC Holdco.
“
Excluded Swap Obligations”: with respect to
any Loan Party (other than the direct counterparty of such Swap Obligation), any Swap Obligation of a Loan Party (other than the direct counterparty of such Swap Obligation) if, and to the extent that, all or a portion of the guarantee of such Loan
Party pursuant to a Guaranty of, or the grant by such Loan Party of a security interest pursuant to the Loan Documents to secure, such Swap Obligation (or any guarantee thereof) is or becomes illegal under the Commodity Exchange Act or any rule,
regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Loan Party’s failure for any reason to constitute an
“eligible contract participant” as defined in the
Commodity Exchange Act at the time the guarantee of such Loan Party pursuant to a Guaranty or the grant of such security interest pursuant to a Loan Document would have otherwise become effective with respect to such Swap Obligation but for such
Guarantor’s failure to constitute an
“eligible contract participant” at such time. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is
attributable to swaps for which such guarantee or security interest is or becomes illegal.
“Excluded Taxes”: with respect to the Agent,
any Lender or any other recipient of any payment made by or on account of any obligation of any Loan Party under any Loan Document, (i) Taxes imposed on or measured by its net income or net profits (however denominated), franchise Taxes imposed on it
in lieu of net income Taxes and branch profits Taxes imposed on it, in each case, by any jurisdiction (or any political subdivision thereof) (a) as a result of the recipient being organized under the laws of, or having its principal office located
in, or, in the case of any Lender, its applicable lending office in such jurisdiction, or (b) that are Other Connection Taxes, (ii) any US federal withholding Tax that is imposed on amounts payable to a Lender (other than a Non-US Lender that becomes
a Lender pursuant to a request by a Loan Party) under any laws in effect at the time such Lender becomes a party hereto (or designates a new lending office), except to the extent that, in the case where a Lender designates a new lending office, such
Lender, or in the case of an assignment, the assignor, was entitled, immediately prior to the time of designation of a new lending office or assignment as the case may be, to receive additional amounts from the Borrower with respect to such Tax
pursuant to Section 2.13(a), (iii) any Tax is attributable to such recipient’s failure to comply with Section
2.13(e) and (iv) any withholding Tax that is imposed pursuant to FATCA.
“Existing Loan Agreement”: has the meaning
set forth in the recitals to this Agreement.
“FATCA”: Sections 1471 through 1474 of the
Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof, any applicable
agreement entered into pursuant to Section 1471(b)(1) of the Code and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement, treaty or convention among Governmental Authorities and implementing
such Sections of the Code.
“Federal Funds Effective Rate”: for any day,
the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System arranged by federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if
such rate is not so published for any day which is a Business Day, the average of the quotations for the day of such transactions received by the Agent from three federal funds brokers of national recognized standing selected by it.
“Fee Letter”: that certain amended and
restated side letter dated as of the Closing Date executed between the Borrower and the Agent with respect to certain fees payable in connection with this Agreement, as it may be amended, modified or restated from time to time.
“
Financial Statements”: (a) the audited
balance sheet of the Borrower for the fiscal year ended
December 31, 2019, and the related statements of income and cash flows as of and for the fiscal year then ended and (b) the unaudited balance sheet of the Borrower for the twelve-month period
ended on
December 31, 2020, and the related statements of income as of and for the year to date then ended.
“
Fixed Charge Coverage Ratio”: for the
Borrower and its
Subsidiaries on a consolidated basis, for the fiscal quarter most recently ended and the immediately preceding three fiscal quarters, the ratio of Free Cash Flow to Debt Service for such period.
“Flood Insurance Laws”: collectively, (i) the
National Flood Insurance Act of 1968 as now or hereafter in effect or any successor statute thereto, (ii) the Flood Disaster Protection Act of 1973 as now or hereafter in effect or any successor statue thereto, (iii) the National Flood Insurance
Reform Act of 1994 as now or hereafter in effect or any successor statute thereto, (iv) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statute thereto and (v) the Biggert-Waters Flood Insurance Reform Act of
2012 as now or hereafter in effect or any successor statute thereto.
“Foreign Subsidiary”: any Subsidiary that is
not organized under the laws of the United States, any state thereof or the District of Columbia.
“
Free Cash Flow”: with respect to any
fiscal period, without duplication, the sum of (a) Adjusted EBITDA for such fiscal period,
minus (b) Maintenance Capital Expenditures made (to the extent not already incurred in
a prior period) or incurred during such period,
minus (c) the aggregate amount of U.S. federal, state and local and non-U.S. taxes paid in cash on or measured by income of the
Borrower and its
Subsidiaries for such fiscal period (including, without duplication, Restricted Payments made pursuant to
Section 6.6(ii) for the purpose of allowing the
Borrower’s members to pay income taxes attributable to the business of the Borrower and its
Subsidiaries),
minus all Restricted Payments made during such period.
“Fronting Exposure”: at any time there is a
Defaulting Lender, (i) such Defaulting Lender’s Revolving Loan Commitment Percentage of the outstanding Letter of Credit Amount and (ii) such Defaulting Lender’s pro rata share of outstanding Swing Line Loans made by the Swing Line Lender other than
Swing Line Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders in accordance with the terms hereof.
“GAAP”: generally accepted accounting
principles in the United States in effect from time to time.
“
General Intangibles”: General Intangibles
(as that term is defined in the UCC), including payment intangibles,
contract rights, rights to payment, rights arising under common law, statutes, or regulations, choses or things in action, goodwill, patents, trade names, trade secrets, trademarks,
servicemarks, copyrights, blueprints, drawings, purchase orders, customer lists, monies due or recoverable from pension funds, route lists, rights to payment and other rights under any royalty or licensing agreements, infringement claims, computer
programs, information contained on computer disks or tapes, software, literature, reports, catalogs, insurance premium rebates, tax refunds, and tax refund claims, and any other personal property other than Accounts, Deposit Accounts, Goods,
Investment Property, and Negotiable Collateral.
“Governmental Authority”: any nation or
government, any federal, state or other political subdivision thereof and any federal, state or local entity exercising executive, legislative, judicial, regulatory or administrative functions of government (including any supra-national bodies such
as the European Union or the European Central Bank).
“Guarantee Obligation”: as to any Person
(the “guaranteeing person”), any obligation of (a) the guaranteeing person or (b) another Person (including any bank under any letter of credit) which Person the guaranteeing
person has agreed to reimburse or indemnify for undertaking such obligation in either case guaranteeing or in effect guaranteeing any Indebtedness, leases, dividends or other obligations (the “primary
obligations”) of any other third Person (the “primary obligor”) in any manner, whether directly or indirectly, including any obligation of the guaranteeing person,
whether or not contingent, (i) to purchase any such primary obligation or any property constituting direct or indirect security therefor, (ii) to advance or supply funds for the purchase or payment of any such primary obligation or to maintain
working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor, (iii) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary
obligation of the ability of the primary obligor to make payment of such primary obligation or (iv) otherwise to assure or hold harmless the owner of any such primary obligation against loss in respect thereof; provided, however, that the term Guarantee Obligation shall not include endorsements of instruments for deposit or collection or customary
indemnifications under agreements, in each case given or entered into in the ordinary course of business. The amount of any Guarantee Obligation of any guaranteeing person shall be deemed to be the lesser of (a) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such Guarantee Obligation is made and (b) the maximum amount for which such guaranteeing person may be liable pursuant to the terms of the instrument embodying such Guarantee
Obligation, unless such primary obligation and the maximum amount for which such guaranteeing person may be liable are not stated or determinable, in which case the amount of such Guarantee Obligation shall be such guaranteeing person’s maximum
reasonably anticipated liability in respect thereof as determined by the Borrower in good faith.
“Guarantor Security Agreement”: one or more
security agreements executed and delivered by a Guarantor, including pursuant to Section 5.12(a) hereof, to secure the obligations of the Guarantors under any Guaranty, in each
case, in form and substance reasonably satisfactory to the Agent, as the same may be amended, restated, modified or supplemented in accordance with the terms hereof and thereof.
“
Guarantors”: collectively, (a) each
Subsidiary of the Borrower (other than an Excluded Subsidiary) and (b) with respect to any Hedging Obligations owing by any Loan Party or any of its
Subsidiaries and any Swap Obligation of a Specified Loan Party, the Borrower. For the avoidance of
doubt, no Excluded Subsidiary shall be a Guarantor.
“Guaranty”: one or more guaranty agreements
executed and delivered by a Guarantor, including pursuant to Section 5.12(a) hereof, guaranteeing the Obligations, in each case, in form and substance reasonably satisfactory to
the Agent, as the same may be amended, restated, modified or supplemented in accordance with the terms hereof and thereof.
“Hazardous Substances”: any substance or
material that is described as a toxic or hazardous substance, waste, material, pollutant, contaminant or infectious waste, or words of similar import or meaning, or any other words which are intended to define, list or classify substances by reason
of deleterious properties such as ignitability, corrosivity, reactivity, carcinogenicity, toxicity, or reproductive toxicity and includes, without limitation, asbestos and asbestos containing materials, petroleum (including crude oil or any fraction
thereof, natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable for fuel, or any mixture thereof), petroleum products, polychlorinated biphenyls, urea formaldehyde, radon gas, radioactive matter, medical waste, otherwise
regulated materials and chemicals which cause cancer or reproductive toxicity, which is or becomes designated, classified or regulated as being “toxic”, “hazardous” or similarly designated, classified or regulated under any Environmental Laws.
“Hedging Agreements”: as defined in the
definition of “Hedging Obligations” in this Section 1.1.
“Hedging Obligations”: of any Person, any
and all obligations of such Person, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), under (i) any and all
agreements, devices or arrangements designed to protect at least one of the parties thereto from the fluctuations of interest rates, commodity prices, exchange rates or forward rates applicable to such party’s assets, liabilities or exchange
transactions, including dollar-denominated or cross-currency interest rate exchange agreements, forward currency exchange agreements, interest rate cap or collar protection agreements, forward rate currency or interest rate options, puts and warrants
or any similar derivative transactions (“Hedging Agreements”), and (ii) any and all cancellations, buy-backs, reversals, terminations or assignments of any of the foregoing; provided that Hedging Obligations shall not include Excluded Swap Obligations.
“Holdout Lender”: as defined in Section 10.2.
“Increased Amount Date”: as defined in Section 2.23 hereof.
“Incremental Facility Supplement”: as
defined in Section 2.23 hereof.
“Incremental Term Loan”: as defined in Section 2.23 hereof.
“Incremental Term Loan Commitment”: as
defined in Section 2.23 hereof.
“Incremental Term Note”: as defined in Section 2.23 hereof.
“Indebtedness”: as to any Person, (i) all
indebtedness of such Person for borrowed money, (ii) all indebtedness of such Person for the deferred purchase price of property or services incurred in the ordinary course of business (other than trade payables or deferred rent, taxes or
compensation, in each case, incurred in the ordinary course of business and repayable in accordance with customary trade practices), (iii) all obligations of such Person evidenced by notes, bonds, debentures or other similar instruments, (iv) all
indebtedness created or arising under any conditional-sale or other title-retention agreement with respect to property acquired by such Person, (v) all Capitalized Lease Obligations of such Person, (vi) all obligations, contingent or otherwise, of
such Person under bankers’ acceptance, Letter of Credit or similar facilities, (vii) all mandatory redemption, mandatory repurchase or mandatory dividend obligations of such Person with respect to its stock, in each case to the extent due in cash on
or before that date that is ninety-one (91) days after the later of the Revolving Loan Commitment Expiration Date, the Delayed Draw Term Loan Maturity Date and the maturity date of any Incremental Term Loan facility, (viii) all liabilities in respect
of unfunded vested benefits under plans covered by Title IV of ERISA, (ix) all Hedging Obligations of such Person and (x) all Guarantee Obligations of such Person in respect of, and obligations (contingent or otherwise) to purchase or otherwise
acquire, or otherwise to secure a credit against loss in respect of, indebtedness or obligations of others of the kinds referred to in clause (i), (ii), (iii), (iv), (v), (vi), (vii), (viii), or (ix) above.
“Indemnified Taxes”: (i) Taxes, other than
Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (ii) to the extent not otherwise described in (i), Other Taxes.
“Insolvency”: with respect to any
Multiemployer Plan, the condition that such Multiemployer Plan is insolvent within the meaning of Section 4245 of ERISA.
“Installed Store”: a store or other place of
business not owned, leased or operated by a Loan Party or any of its Affiliates in which Borrower’s products are maintained and sold.
“Intellectual Property”: as defined in Section 3.8 hereof.
“
Intellectual Property Security Agreement”:
any patent security agreement, trademark security agreement, copyright security agreement, or any notice thereof, made by the grantors party thereto in favor of the Agent, in form and substance reasonably satisfactory to the Agent, including that
certain Third Amended and Restated Trademark Security Agreement, dated as of
May 15, 2019, executed and delivered by Borrower and Agent, in each case, as the same may be amended, restated, modified or supplemented in accordance with the terms hereof
and thereof.
“
Intercompany Subordination Agreement”: that
certain Amended and Restated Intercompany Subordination Agreement, dated as of
November 13, 2014, executed and delivered by Borrower, the Canadian Subsidiary and Agent, as supplemented by (i) that certain Joinder Agreement, dated as of
September 21,
2017, by and among the UK Subsidiary, Borrower and the Agent and (ii) that certain Joinder Agreement, dated as of
May 15, 2019, by and among the Dutch Subsidiary, Borrower and the Agent, and as the same may be further amended, restated, supplemented,
or otherwise modified from time to time in accordance to the terms thereof and hereof.
“Interest Expense”: as of any date, with
respect to any Person, the sum of (a) all cash interest, unused commitment fees, letter of credit fees and similar fees (in each case as such expenses are calculated according to GAAP) paid or payable (without duplication) for such fiscal period by
that Person to a lender in connection with borrowed money or the deferred purchase price of assets, in each case to the extent considered “interest expense” under GAAP, including the net effect of payments made or received by the Borrower under any
Hedging Agreement to the extent allocable to such period under GAAP plus (b) the portion of rent paid or payable (without duplication) for such fiscal period by that Person under Capitalized Lease Obligations that is treated as interest in accordance
with GAAP.
“Interest Payment Date”: (a) as to any Base
Rate Loan, the last Business Day of each calendar quarter to occur while any such Loan is outstanding, (b) as to any LIBOR Loan having an Interest Period of three months or less, the last day of such Interest Period, (c) as to any LIBOR Loan having
an Interest Period longer than three months, each day which is at the end of each three month-period within such Interest Period after the first day of such Interest Period and the last day of such Interest Period and (d) for each of clauses (a), (b)
and (c) above the day on which any such Loan becomes due and payable in full or is paid or prepaid in full.
“Interest Period”: with respect to any LIBOR
Loan (other than with respect to LIBOR Loans outstanding with respect to Swing Line Loans, which shall be subject to the last paragraph of this definition):
(a) initially, the period commencing on the borrowing or conversion date, as the case may be, with respect to such LIBOR Loan and ending one (1), two (2), three (3), or six (6) months thereafter, as
available, as selected by the Borrower in its notice of borrowing or its Continuation Notice, as the case may be, given with respect thereto; and
(b) thereafter, each period commencing on the last day of the next preceding Interest Period applicable to such LIBOR Loan and ending one (1), two (2), three (3), or six (6) months thereafter, as
available, as selected by the Borrower by irrevocable notice to the Agent not less than three (3) Eurodollar Business Days prior to the last day of the then current Interest Period with respect thereto;
provided that,
all of the foregoing provisions relating to Interest Periods are subject to the following:
(i) if any Interest Period pertaining to a LIBOR Loan would otherwise end on a day that is not a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless the
result of such extension would be to carry such Interest Period into another calendar month in which event such Interest Period shall end on the immediately preceding Business Day;
(ii) any Interest Period for any Loan that would otherwise extend beyond the date final payment is due on such Loan shall end on the date of such final payment; and
(iii) any Interest Period pertaining to a LIBOR Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the
calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar month.
“Interest Rate Determination Date”: with
respect to any Interest Period, the date that is two Business Days prior to the first day of such Interest Period.
“Investment Company Act”: as defined in Section 3.12 hereof.
“IRS”: the U.S. Internal Revenue Service.
“Issuing Bank”: CNB.
“
Kitchen South Agreement”: that certain
Contract Manufacturing Agreement entered into by the Borrower and the contractor thereunder with respect to the manufacturing of the Borrower’s products in Arkansas, a copy of which has been provided to the Agent prior to the Closing Date, as such
agreement may be amended, restated, supplemented, or otherwise modified from time to time in accordance to the terms thereof and hereof.
“Landlord Consent”: each waiver or consent
or similar document executed by the landlord of the Borrower or any Subsidiary, in form and substance reasonably satisfactory to the Agent, as such agreements may be amended, restated, modified or supplemented from time to time in accordance with the
terms hereof and thereof.
“Lenders”: as defined in the preamble hereto
and Section 8.8 hereof. References to the “Lenders” will include the Issuing Bank and the Swing Line Lender, where applicable.
“Lender Hedging Agreement”: any Hedging
Agreement entered into between the Borrower or any Subsidiary thereof and an Eligible Counterparty.
“Letter of Credit”: as defined in Section 2.1(b) hereof.
“Letter of Credit Amount”: the stated
maximum amount available to be drawn under a particular Letter of Credit, as such amount may be reduced or reinstated from time to time in accordance with the terms of such Letter of Credit.
“Letter of Credit Request”: a request by the
Borrower for the issuance of a Letter of Credit on the Agent’s standard form of standby Letter of Credit application and agreement.
“Letter of Credit Sublimit”: as defined in Section 2.1(b) hereof.
“Leverage Level 1”: as used in the
definition of “Applicable Margin” contained in this Section 1.1.
“LIBOR”: with respect to any LIBOR Loan for
any Interest Period, a rate per annum equal to the rate determined by the Agent and equal to the rate (rounded upwards, if necessary, to the nearest 1/100 of 1%) quoted as (i) the “LIBOR Rate” which appears on the Bloomberg Screen B TMM Page under
the heading “LIBOR Fix” as of 11:00 a.m. (London Time) for the date that is the applicable Interest Rate Determination Date or (ii) in the event the rate referenced in the preceding clause
(i) does not appear on such page or service or if such page or service shall cease to be available, the rate per annum determined as of approximately 9:00 a.m. (Los Angeles time) on such Interest Rate Determination Date by reference to
the Intercontinental Exchange Benchmark Administration Ltd. Interest Settlement Rates for deposits in Dollars (as set forth by any service selected by the Agent that has been nominated by the Intercontinental Exchange Benchmark Administration Ltd.
(or any successor or substitute agency determined by the Agent) as an authorized information vendor for the purpose of displaying such rates) with a term equivalent to the applicable Interest Period; provided that if LIBOR shall be less than 0.75%, such rate shall be deemed to be 0.75% for all purposes under this Agreement. The Agent currently uses the rate quoted in Bloomberg as indicated above to provide
information with respect to the interbank Eurodollar market, but the Agent, in its sole discretion, may change the service providing such information at any time. Each determination of LIBOR by the Agent shall be conclusive and binding upon the
parties hereto, absent manifest error.
“LIBOR Adjusted Rate”: with respect to each
day during each Interest Period pertaining to a LIBOR Loan, a rate per annum determined for such day in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):
|
LIBOR
|
|
|
1.00 - LIBOR Reserve Requirements
|
|
“LIBOR Loans”: Loans the rate of interest
applicable to which is based upon LIBOR Adjusted Rate.
“LIBOR Reserve Requirements”: for any day as
applied to a LIBOR Loan, the aggregate (without duplication) of the maximum rates (expressed as a decimal fraction) of reserve requirements in effect on such day (including basic, supplemental, marginal and emergency reserves under any regulations of
the Board of Governors of the Federal Reserve System or other Governmental Authority having jurisdiction with respect thereto) dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities”
in Regulation D of such Board) maintained by a member bank of such Federal Reserve System.
“
Lien”: means any interest in an asset
securing an obligation owed to, or a claim by, any Person other than the owner of the asset, irrespective of whether (a) such interest is based on the common law, statute, or
contract, (b) such interest is recorded or perfected, and (c) such interest
is contingent upon the occurrence of some future event or events or the existence of some future circumstance or circumstances. Without limiting the generality of the foregoing, the term
“Lien” includes the lien or security interest arising from any
mortgage, deed of trust, pledge, charge, hypothecation, assignment, deposit arrangement, encumbrance, lien (statutory or other), security agreement or other security interest of any kind or nature whatsoever (including any conditional sale or other
title retention agreement or any Capitalized Lease Obligation having substantially the same economic effect as any of the foregoing). For the avoidance of doubt, the term
“Lien” shall not be deemed to include any nonexclusive intellectual property
license.
“Loan”: a Revolving Loan, a Swing Line Loan,
a Delayed Draw Term Loan or an Incremental Term Loan, as applicable; and “Loans” means the aggregate of all Revolving Loans, all Swing Line Loans, all Delayed Draw Term Loans and
all Incremental Term Loans, as applicable, outstanding at any given time.
“Loan Documents”: this Agreement, any Notes,
the Collateral Documents, the Master Reaffirmation Agreement, the Fee Letter, the Intercompany Subordination Agreement, any Environmental Indemnity, any Lender Hedging Agreements, each Landlord Consent, any bailee letters, any Letter of Credit
Requests, any Incremental Facility Supplement and any other agreement executed by a Loan Party in connection therewith and herewith, or in connection with the Existing Loan Agreement, as such agreements and documents may be amended, restated,
supplemented and otherwise modified from time to time in accordance with the terms hereof.
“Loan Parties”: the Borrower and each
Guarantor, and “Loan Parties” means any of them.
“
Maintenance Capital Expenditures”: means,
for any period, the sum of (without duplication) (a) Capital Expenditures made during such period on account of the maintenance of the Equipment of Borrower and its
Subsidiaries and (b) the
higher of (i) the actual amount spent on Capital Expenditures made during such period on account of maintenance of the Chillers and (ii) Capital Expenditures made during such period on account of maintenance of the
Chillers, calculated as the product of (x) the total number of Installed Stores as of the end of such period
multiplied by (y) $10.
“Margin Stock”: as defined in Regulation U.
“
Master Reaffirmation Agreement”: that
certain Master Reaffirmation Agreement, dated as of the Closing Date, executed and delivered by Borrower, each of its
Subsidiaries party thereto and Agent, as the same may be amended, restated, supplemented, or otherwise modified from time to time in
accordance to the terms thereof and hereof.
“
Material Adverse Effect”: a material
adverse effect on (a) the business, operations, results of operations, property or condition (financial or otherwise) of the Borrower and its
Subsidiaries, taken as a whole, (b) the ability of the Loan Parties, taken as a whole, to perform their
obligations under the Loan Documents or (c) the validity or enforceability of any material provision of the Loan Documents or the rights or remedies of the Agent or the Lenders hereunder or thereunder.
“Material Agreements”: the Kitchen South
Agreement.
“Maturity Date”: the latest of the Revolving
Loan Commitment Expiration Date and the Delayed Draw Term Loan Maturity Date.
“Maximum Commitment Amount”: as defined in Section 2.23 hereof.
“
Mortgages”: individually and collectively,
(i) that certain Amended, Restated, and Consolidated Open-End Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of
May 10, 2019, made by and from the Borrower to the Agent, and recorded with the Recorder of
Deeds, Northampton County, Pennsylvania, in Book 2019-1, Starting Page 92121, relating to Property A, as amended by that certain Modification of Amended, Restated, and Consolidated Open-End Mortgage, Assignment of Leases and Rents, Security Agreement
and Fixture Filing, dated as of
April 13, 2020, made by the Borrower to the Agent, and recorded with the Recorder of Deeds, Northampton County, Pennsylvania, in Book 2020-1, Starting Page 83564, and that certain Second Modification of Amended,
Restated, and Consolidated Open-End Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing, dated as of the Closing Date, made by the Borrower to the Agent, to be recorded with the Recorder of Deeds, Northampton County,
Pennsylvania, on or about the Closing Date, (ii) that certain Deed of Trust, Assignment of Leases and Rents, Security Agreement and Fixture Filing to be made by the Borrower to the Agent, and to be recorded with the County Clerk, Ellis County, Texas,
relating to Property B, as further described in
Section 5.16(a)(iii), and (iii) any other mortgages, deeds of trust, or deeds to secure debt, executed and delivered by Borrower
or another Loan Party in favor of Agent, in form and substance reasonably satisfactory to Agent, that encumber the Real Property Collateral, in each case, as the same may be amended, restated, supplemented, or otherwise modified from time to time in
accordance to the terms thereof and hereof.
“Multiemployer Plan”: an “employee benefit
plan” (as defined in Section 3(3) of ERISA) which is a “multiemployer plan” (as defined in Section 4001(a)(3) of ERISA) and which is subject to Title IV of ERISA, and in respect of which any Loan Party or any ERISA Affiliate thereof has, any
liability (contingent or otherwise), or during the preceding six year period has had any liability if a Loan Party would continue to have liability thereto.
“Negotiable Collateral”: letters of credit,
Letter‑of‑Credit Rights, Instruments, Promissory Notes, drafts, Documents, and Chattel Paper (including Electronic Chattel Paper and tangible Chattel Paper).
“
Net Proceeds”: (A) with respect to any
Asset Disposition, the net amount equal to the aggregate amount received in cash (including any cash received by way of deferred payment pursuant to a note receivable, other non-cash consideration or otherwise, but only as and when such cash is so
received) in connection with such Asset Disposition
minus the sum of (i) the reasonable expenses, including attorneys’, accountants’, investment banking, financial advisory and
other customary fees, commissions and expenses, incurred by the Borrower or any of its
Subsidiaries in connection with such Asset Disposition (including any such bona fide fees, commissions and expenses payable to an Affiliate of the Borrower), (ii)
Indebtedness, other than the Loans, required to be paid in connection with such Asset Disposition and (iii) U.S. federal, state and local and non U.S. taxes, including transfer taxes and net income taxes, paid or reasonably estimated to be payable as
a result of such Asset Disposition; and (B) with respect to any Equity Offering or Debt Offering, the net amount equal to the aggregate amount received in cash (including any cash received by way of deferred payment pursuant to a note receivable,
other non-cash consideration or otherwise, but only as and when such cash is so received) in connection with such Equity Offering or Debt Offering
minus the sum of (i) the
reasonable expenses, including attorneys’, accountants’, investment banking, financial advisory and other customary fees, commissions and expenses, incurred by the Borrower or any of its
Subsidiaries in connection with such Equity Offering or Debt
Offering (including any such bona fide fees, commissions and expenses payable to an Affiliate of the Borrower) and (ii) U.S. federal, state and local and non-U.S. taxes, including transfer taxes and net income taxes, paid or reasonably estimated to
be payable as a result of such Equity Offering or Debt Offering. For purposes of this definition, the term
“Asset Disposition” shall include those dispositions described in clauses (h)(y), (j) and (l) of the definition of
“Asset Disposition.”
“New Lender”: as defined in Section 2.23 hereof.
“Non-US Lender”: a Lender that is not a
“United States person” as defined in Section 7701(a)(30) of the Code.
“Note”: a Revolving Note, a Swing Line Note,
a Delayed Draw Term Note, or, if the Incremental Term Loan facility shall be activated, any Incremental Term Note, as applicable; and “Notes” means the aggregate of all Revolving
Notes, all Swing Line Notes, all Delayed Draw Term Notes and all Incremental Term Notes.
“Obligations”: the unpaid principal of and
interest on (including interest accruing after the maturity of the Loans and interest accruing on or after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Borrower,
whether or not a claim for post-filing or post-petition interest is allowed in such proceeding and whether or not at a default rate) the Loans, the obligation to reimburse drawings under Letters of Credit (including the contingent obligation to
reimburse any drawings under outstanding Letters of Credit), and all other obligations and liabilities of the Loan Parties to the Agent and the Lenders, whether direct or indirect, absolute or contingent, due or to become due, or now existing or
hereafter incurred, which may arise under, out of, or in connection with, this Agreement, the Loans, any other Loan Document, any Letter of Credit and any other document made, delivered or given in connection herewith or therewith, including any and
all obligations under Lender Hedging Agreements and any and all Cash Management Obligations, whether on account of principal, interest, reimbursement obligations, fees, indemnities, costs, expenses (including all reasonable fees and disbursements of
counsel to the Agent and the Lenders that are required to be paid by any Loan Party pursuant to the terms of this Agreement, the other Loan Documents and any Lender Hedging Agreement); provided
that “Obligations” shall not include Excluded Swap Obligations.
“Occupancy Agreements”: as defined in Section 5.10 hereof.
“OFAC”: the U.S. Department of Treasury
Office of Foreign Assets Control, or any successor thereto.
“OFAC Lists”: collectively, the Specially
Designated Nationals and Blocked Persons List maintained by OFAC pursuant to any of the rules and regulations of OFAC or pursuant to any applicable executive orders, including Executive Order No. 13224, as that list may be amended from time to time.
“
Organic Documents”: with respect to any
entity, in each case to the extent applicable thereto, its certificate or
articles of incorporation or organization, its
bylaws or operating agreement, its partnership agreement, all other formation and/or governing documents, and all Equityholder
Agreements, voting agreements and similar arrangements applicable to any of its authorized shares of capital stock, its partnership interests or its membership interests, and any other arrangements relating to the control or management of any such
entity (whether existing as a corporation, a partnership, a limited liability company or otherwise).
“Other Connection Taxes”: with respect to any
Agent or Lender, Taxes imposed as a result of a present or former connection between such Person and the jurisdiction imposing such Tax (other than connections arising from such Person having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).
“Other Taxes”: all present or future stamp,
court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or
otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made at the request of the Borrower)
“Participant”: as defined in Section 10.7(b) hereof.
“PATRIOT Act”: as defined in Section 10.17 hereof.
“PBGC”: the Pension Benefit Guaranty
Corporation established pursuant to Subtitle A of Title IV of ERISA or any successor thereto.
“
Permitted Acquisition” any Acquisition
consummated after the Closing Date by the Borrower or any of its
Subsidiaries that is either consented to by the Required Lenders in writing or that satisfies each of the following conditions:
(a) no Default or Event of Default shall have occurred and be continuing or would result therefrom;
(b) in the case of the acquisition of all or substantially all of the assets of a Person, all such assets shall be owned 100% by the Borrower or a Subsidiary that is a Guarantor, and such Loan Party
shall take all actions to subject such assets (other than Excluded Assets) to the first priority Lien of the Agent (subject to Liens permitted by Section 6.3), in accordance
with the terms and conditions hereof and of the other Loan Documents within 10 days of such acquisition (or such later date as the Agent may agree);
(c) in the case of the acquisition of Capital Stock, all of the Capital Stock (except for any such securities in the nature of directors’ qualifying shares required pursuant to applicable law) acquired
or otherwise issued by such Person or any newly formed Subsidiary of the Borrower in connection with such acquisition shall be owned 100% by the Borrower or a Subsidiary that is a Guarantor, and such Loan Party shall comply with Section 5.12;
(d) Borrower and its Subsidiaries shall be in compliance with the financial covenants set forth in Section 6.1, on a pro forma
basis after giving effect to such Acquisition as of the last day of the most recently ended fiscal quarter of the Borrower, and shall have provided a certificate to the Agent to such effect;
(e) such Acquisition shall be consensual;
(f) the assets being acquired (other than a de minimis amount of assets in relation to Borrower’s and its
Subsidiaries’ total assets), or the Person whose Capital Stock is being acquired, are useful in or engaged in, as applicable, the business of Borrower and its Subsidiaries or a business reasonably related thereto;
(g) the assets being acquired (other than a de minimis amount of assets in relation to the assets being acquired)
are located within the United States or Canada, or the Person whose Capital Stock is being acquired is organized in a jurisdiction located within the United States or Canada;
(h) the Borrower shall have delivered to the Agent and the Lenders, at least five (5) Business Days prior to the date on which any such acquisition is to be consummated, (i) a due diligence package,
(ii) drafts of acquisition documents together with related disclosure schedules, (iii) a summary description of such acquisition, (iv) upon the request of the Agent for any Permitted Acquisition where the Permitted Acquisition Consideration exceeds
$10,000,000, audited or reviewed financial statements or a quality of earnings report from Accountants;
(i) the Permitted Acquisition Consideration shall be composed solely of (i) common Capital Stock of Borrower or (ii) Subordinated Debt permitted pursuant to Section 6.2(h); and
(j) on or prior to the closing date for such Permitted Acquisition (or such later date as the Agent shall permit in its reasonable discretion), the Borrower shall have delivered to the Agent a
certificate of a Responsible Officer of the Borrower certifying that all of the requirements set forth in this definition of “Permitted Acquisition” have been satisfied or will be satisfied on or prior to the consummation of such Acquisition, other
than the requirements of clause (b) and (c) hereof, which shall be satisfied as set forth therein.
“Permitted Acquisition Consideration”: the
purchase consideration for any Permitted Acquisition payable by the Borrower or any Subsidiary and all other payments by the Borrower or any Subsidiary in exchange for, or as part of, or in connection with, any Permitted Acquisition, whether paid in
cash or by exchange of Capital Stock or of properties or otherwise and whether payable at or prior to the consummation of such Permitted Acquisition or deferred for payment at any future time, whether or not any such future payment is subject to the
occurrence of any contingency, and includes any and all payments representing the purchase price and any assumptions of Indebtedness, “earn-outs” and other agreements to make any payment the amount of which is, or the terms of payment of which are,
in any respect subject to or contingent upon the revenues, income, cash flow or profits (or the like) of any Person or business (it being understood that any “earn outs” with respect to any Permitted Acquisition shall be the projected value thereof,
as of the date of consummation of such Permitted Acquisition, as determined in good faith by the Borrower and, upon the request of the Agent, the Borrower agrees to provide the Agent with calculations used by the Borrower in determining the
foregoing.
“Permitted Discretion”: a determination made
in the exercise of reasonable (from the perspective of a secured lender) business judgment.
“Permitted Lien”: shall mean Liens permitted
by Section 6.3 hereof.
“Person”: any individual, firm, partnership,
joint venture, corporation, limited liability company, association, business enterprise trust, unincorporated organization, government or department or agency thereof or other entity, whether acting in an individual, fiduciary or other capacity.
“Portfolio Interest Exemption”: as defined in
Section 2.13(e)(iii)(3) hereof.
“Pricing Certificate”: a certificate of a
Responsible Officer or other senior officer of the Borrower substantially in the form of Exhibit F attached hereto.
“Projects”: development and expansion of
Borrower’s production facilities at Property A and Property B.
“
Properties”: the collective reference to
the real and personal property owned, leased, used, occupied or operated, under
contract, license or permit, by any Loan Party, including without limitation, each Real Property.
“
Property A”: Real Property at address 176
N. Commerce Way,
Bethlehem,
PA 18017.
“
Property B”: approximately 74 acres of Real
Property at address 4800 Sterilite Drive,
Ennis,
TX 75119, and further described in the William H. Ewing Survey, Abstract Number 332, attached to that certain Purchase and Sale Agreement, between the Borrower and Ennis Economic Development
Corporation, signed January, 2020.
“Purchase Money Indebtedness” means
Indebtedness (other than the Obligations, but including Capitalized Lease Obligations), incurred at the time of, or within 90 days after, the acquisition of any fixed assets for the purpose of financing all or any part of the acquisition cost
thereof.
“Purchasing Lender”: as defined in Section 10.7(c) hereof.
“
Qualified ECP Guarantor”: in respect of any
Swap Obligation, each Loan Party with total assets exceeding $10,000,000 at the time the relevant guarantee or grant of the relevant security interest becomes effective with respect to such Swap Obligation or such other person as constitutes an
“eligible contract participant” under the Commodity Exchange Act or any regulations promulgated thereunder and can cause another Person to qualify as an
“eligible contract participant” at such time by entering into a keepwell under Section
1a(18)(A)(v)(II) of the Commodity Exchange Act.
“
Real Property”: any estates or interests in
real property now owned or hereafter acquired by Borrower or any of its
Subsidiaries and the improvements thereto.
“Real Property Collateral”: Property A,
Property B and any other Real Property hereafter acquired by a Loan Party; provided that Real Property Collateral shall not include Excluded Property, so long as such Real
Property Collateral constitutes Excluded Property.
“Record”: information that is inscribed on a
tangible medium or which is stored in an electronic or other medium and is retrievable in perceivable form.
“Refunded Swing Line Loans” as defined in Section 2.21(f) hereof.
“Register” as defined in Section 10.7(d) hereof.
“Regulation D”: Regulation D of the Board of
Governors of the Federal Reserve System, as the same is from time to time in effect, and all official rulings and interpretations thereunder or thereof and any successor regulation thereto.
“Regulation U”: Regulation U of the Board of
Governors of the Federal Reserve System, as the same is from time to time in effect, and all official rulings and interpretations thereunder or thereof and any successor regulation thereto.
“Related Parties”: with respect to any
Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees, administrators, managers, advisors and representatives of such Person and of such Person’s Affiliates.
“Remedial Action”: all actions taken to (a)
clean up, remove, remediate, contain, treat, monitor, assess, evaluate, or in any way address Hazardous Substances in the indoor or outdoor environment, (b) prevent or minimize a release or threatened release of Hazardous Substances so they do not
migrate or endanger or threaten to endanger public health or welfare or the indoor or outdoor environment, (c) restore or reclaim natural resources or the environment, (d) perform any pre-remedial studies, investigations, or post-remedial operation
and maintenance activities, or (e) conduct any other actions with respect to Hazardous Substances required by Environmental Laws.
“Repatriation”: as defined in Section 2.7(g).
“Replacement Lender”: as defined in Section 10.2.
“Reportable Event”: the occurrence of any of
the events set forth in Section 4043(c) of ERISA with respect to a Title IV Plan for which notice to the PBGC is required, other than those events as to which the thirty (30) day notice period is waived under PBGC regulations.
“Required Lenders”: Lenders having
Commitments equal to or more than 50.1% of the Aggregate Total Commitment, or, if any Commitment has terminated, with respect to such Commitment, Lenders with outstanding Loans and/or participations in Letter of Credit (if applicable) under such
Commitment having an unpaid principal balance equal to or more than 50.1% of the sum of (i) the unpaid principal balance of all Loans outstanding, (ii) the aggregate Letter of Credit Amount (if applicable) and (iii) the aggregate amount of
unreimbursed drawings under all Letters of Credit (if applicable); provided that the Commitments, Loans and participations in Letters of Credit of any Defaulting Lender shall be
disregarded in determining Required Lenders at any time; provided further that if there are two or more
Lenders who are not Affiliates of one another, then Required Lenders shall include at least two such Lenders who are not Affiliates of one another.
“Requirement of Law”: as to any Person, its
Organic Documents, and any law, treaty, rule, order, judgment or regulation of an arbitrator or a court or other Governmental Authority, in each case applicable to or binding upon such Person or any of its property or to which such Person or any of
its property is subject.
“Resolution Authority”: an EEA Resolution
Authority or, with respect to any UK Financial Institution, a UK Resolution Authority.
“Responsible Officer”: with respect to any
Loan Party, any chief executive officer, president, vice president, chief financial officer, treasurer or general counsel of such Loan Party, or, with respect to financial matters, the chief financial officer, treasurer, or other officer serving in a
similar capacity of such Loan Party.
“Restricted Payments”: as defined in Section 6.6 hereof.
“Revolving Loan”: as defined in Section 2.1(b) hereof.
“Revolving Loan Commitment”: the commitment
of a Lender listed on Schedule A hereof or in the Assignment and Acceptance pursuant to which it becomes a Lender hereunder, to make Revolving Loans and participate in Letters
of Credit and Swing Line Loans hereunder, as the same may be adjusted pursuant to the provisions hereof.
“
Revolving Loan Commitment Expiration Date”:
February 19, 2026, or such earlier date as the Revolving Loan Commitments shall expire in accordance with the terms hereof (whether pursuant to Section 7.1 or otherwise) or such commitment is terminated in accordance with
Section 2.3.
“Revolving Loan Commitment Percentage”: with
respect to the Swing Line Lender and each Revolving Loan Lender, the percentage equivalent of the ratio which such Lender’s Revolving Loan Commitment bears to the Aggregate Revolving Loan Commitment.
“Revolving Loan Lender”: each Lender having
(i) a Revolving Loan Commitment, (ii) Revolving Loans outstanding, (iii) a participation in any Letter of Credit, or (iv) a participation in any Swing Line Loan.
“Revolving Note”: as defined in Section 2.1(d) hereof.
“Risk Participation Liability” means, as to
each Letter of Credit, all reimbursement obligations of Borrower to the Issuing Bank with respect to such Letter of Credit, consisting of (a) the amount available to be drawn or which may become available to be drawn, (b) all amounts that have been
paid by the Issuing Bank with respect thereto to the extent not reimbursed by Borrower, whether by the making of a Loan or otherwise, and (c) all accrued and unpaid interest, fees, and expenses payable with respect thereto.
“SEC” means the United States Securities and
Exchange Commission and any successor thereto.
“Secured Party” or “Secured Parties”: collectively, the Agent, the Lenders and each counterparty to a Lender Hedging Agreement (including a Person who was a Lender at the time such Hedging Agreement was entered into).
“Solvent”: when used with respect to any
Person, that:
(a) the fair salable value of such Person’s assets exceeds the total amount of liabilities (including contingent, subordinated, unmatured and unliquidated liabilities, in each case valued at the
probable liability of such Person with respect thereto) of such Person as they become absolute and mature;
(b) the present fair salable value of the assets of such Person is not less than the amount that will be required to pay its probable liabilities as such liabilities become absolute and matured;
(c) such Person will be able to realize upon its assets and will have sufficient cash flow from operations to enable it to pay its debts, other liabilities and contingent obligations as they mature in
the ordinary course of its business;
(d) such Person does not have unreasonably small capital with which to engage in its anticipated businesses; and
(e) such Person has not incurred any debts or liabilities, nor does such Person intend to incur, or believe that it will incur, any debts or liabilities, including contingent liabilities, beyond its
ability to pay such debts and liabilities as they become absolute and matured.
“Specified Equity Proceeds”: cash proceeds
from an offering of Borrower’s Capital Stock completed following the Closing Date, as permitted hereunder.
“Specified JV”: that certain Person, as
identified to the Agent in writing by the Borrower on or immediately prior to the Closing Date, in which the Borrower holds a minority interest.
“
Specified Loan Party”: any Loan Party that
is not then an
“eligible contract participant” under the Commodity Exchange Act.
“
Stock Pledge Agreement”: that certain
Amended and Restated Stock Pledge Agreement, dated as of
November 13, 2014, executed and delivered by Borrower to Agent with respect to the pledge of the Stock owned by Borrower, as supplemented by (i) that certain Pledged Interests Addendum with
respect to FP Foods Realty PA, LLC, a Delaware limited liability company, dated as of
October 5, 2016, by Borrower, (ii) that certain Pledged Interests Addendum with respect to the UK Subsidiary, dated as of
March 8, 2017, by Borrower and (iii) that
certain Pledged Interests Addendum with respect to the Dutch Subsidiary, dated as of
May 15, 2019, by Borrower, and as the same may be otherwise amended, restated, supplemented, or otherwise modified from time to time in accordance to the terms
thereof and hereof.
“Subordinated Debt”: Indebtedness of Borrower
that is on terms and conditions (including payment terms, interest rates, covenants, remedies, defaults and other material terms) satisfactory to the Agent and which (a) has been expressly subordinated in right of payment to all Obligations by the
execution and delivery of a subordination agreement, in form and substance satisfactory to Agent and (b) if such Indebtedness is secured by a Lien, such Lien is expressly subordinated to the Liens granted or purported to be granted to the Agent by
the execution and delivery of a subordination agreement, in form and substance satisfactory to Agent.
“
Subsidiary”: as to any Person at any time
of determination, a corporation, partnership, limited liability company or other entity of which shares of stock or other ownership interests having ordinary voting power (other than stock or such other ownership interests having such power only by
reason of the happening of a contingency) to elect a majority of the board of directors or other managers of such corporation, partnership or other entity are at the time owned, or the management of which is otherwise controlled, directly or
indirectly through one or more intermediaries or
Subsidiaries, or both, by such Person. Unless otherwise qualified, all references to a
“Subsidiary” or to
“Subsidiaries” in this Agreement shall refer to a Subsidiary or
Subsidiaries of the Borrower.
“
Swap Obligation”: with respect to any Loan
Party, any obligation to pay or perform under any agreement,
contract or transaction that constitutes a
“swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.
“Swing Line Lender”: CNB in its capacity as
the Swing Line Lender hereunder.
“Swing Line Loan”: as defined in Section 2.21(a) hereof.
“Swing Line Note”: as defined in Section 2.21(c) hereof.
“Swing Line Sublimit”: as defined in Section 2.21(a) hereof.
“
Tax Distributions”: (i) without duplication
of amounts distributed for Taxes pursuant to clause (ii) for any taxable year in which the Borrower or any of its
Subsidiaries is a member of a consolidated, combined. affiliated, unitary, or similar income tax group of which Borrower or a direct or
indirect parent of Borrower is the common parent (a “
Tax Group”), Borrower or any Subsidiary may make distributions to its direct or indirect parent entity necessary to permit
such parent entity to pay any income Taxes of such Tax Group that are due and payable in respect of taxable income attributable to Borrower and/or its
Subsidiaries, provided that the amount of such distributions shall not be greater than the amount
of such Taxes that would have been due and payable by the Borrower and its relevant
Subsidiaries had the Borrower and its relevant
Subsidiaries filed a consolidated, combined, unitary or similar type return with the Borrower as the consolidated
parent and (ii) without duplication of amounts distributed for Taxes pursuant to clause (i), the Borrower may make distributions to its direct and indirect parent entities to pay franchise Taxes and other similar licensing expenses imposed on that
entity by a governmental authority so long as such Taxes or expenses are incurred in the ordinary course of business.
“Tax Status Certificate”: as defined in Section 2.13 hereof.
“Taxes”: all present or future taxes,
levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
“Termination Event”: (a) a Reportable Event,
(b) the institution of proceedings to terminate a Title IV Plan by the PBGC under Section 4042 of ERISA, (c) the appointment by the PBGC of a trustee to administer any Title IV Plan or (d) the institution of proceedings by the PBGC to appoint a
trustee to administer a Title IV Plan.
“Title IV Plan”: any “employee benefit plan”
(as defined in Section 3(3) of ERISA) other than a Multiemployer Plan that is subject to Title IV of ERISA and in respect of which any Loan Party or any ERISA Affiliate thereof has any liability (contingent or otherwise), or during the preceding six
year period has had any liability if a Loan Party would continue to have liability thereto.
“
Total Funded Debt”: as of any date of
determination, without duplication, the sum of all Indebtedness referred to in clauses (i), (iii), (v), or (vii) of the definition of
“Indebtedness” contained in this
Section 1.1
of the Borrower and its
Subsidiaries on a consolidated basis on such date, in each case excluding Subordinated Debt and Indebtedness owed by one Loan Party to another Loan Party.
“
Total Funded Debt Ratio”: for the Borrower
and its
Subsidiaries on a consolidated basis, for the fiscal quarter most recently ended and the immediately preceding three fiscal quarters, the ratio of (i) Total Funded Debt as of the last day of such quarter most recently ended, to (ii) Adjusted
EBITDA for such period.
“Tranche”: the collective reference to LIBOR
Loans the Interest Periods with respect to all of which begin on the same date and end on the same later date (whether or not such LIBOR Loans shall originally have been made on the same day).
“Transferee”: as defined in Section 10.7(f) hereof.
“Type”: as to any Loan, its nature as a Base
Rate Loan or a LIBOR Loan.
“UK Subsidiary”: Freshpet Europe LTD, a
United Kingdom private limited company.
“UCC”: the California Uniform Commercial Code, as in effect from time to time; provided, however, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection,
priority, or remedies with respect to Agent’s Lien on any Collateral is governed by the Uniform Commercial Code as enacted and in effect in a jurisdiction other than the State of California, the term “UCC” shall mean the Uniform Commercial Code as
enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority, or remedies.
“UK Financial Institution”: any BRRD
Undertaking (as such term is defined under the PRA Rulebook (as amended form time to time) promulgated by the United Kingdom Prudential Regulation Authority) or any person falling within IFPRU 11.6 of the FCA Handbook (as amended from time to time)
promulgated by the United Kingdom Financial Conduct Authority, which includes certain credit institutions and investment firms, and certain affiliates of such credit institutions or investment firms.
“UK Resolution Authority”: the Bank of
England or any other public administrative authority having responsibility for the resolution of any UK Financial Institution.
“U.S.” or “United States”: the United States of America.
“US Lender”: any Lender that is a U.S.
Person.
“U.S. Person”: any Person that is a “United
States person” as defined in Section 7701(a)(30) of the Code.
“
Write-down and Conversion Powers”: (a) with
respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described
in the EU Bail-In Legislation Schedule, and (b) with respect to the United Kingdom, any powers of the applicable Resolution Authority under the Bail-In Legislation to cancel, reduce, modify or change the form of a liability of any UK Financial
Institution or any
contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities or obligations of that person or any other person, to provide that any such
contract or instrument is to
have effect as if a right had been exercised under it or to suspend any obligation in respect of that liability or any of the powers under that Bail-In Legislation that are related to or ancillary to any of those powers.
1.2 Other Definitional Provisions.
(a) Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in any other Loan Document or any certificate or other document made or delivered
pursuant hereto or thereto.
(b) As used herein, in any other Loan Document, and in any certificate or other document made or delivered pursuant hereto or thereto, accounting terms not defined in Section 1.1 and accounting terms
partly defined in Section 1.1, to the extent not defined, shall have the respective meanings given to them under GAAP. Unless otherwise provided herein, all financial calculations made with respect to the Borrower for the purpose of determining
compliance with the terms of this Agreement shall be made on a consolidated basis and in accordance with GAAP.
(c) The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement,
and Section, subsection, Schedule and Exhibit references are to this Agreement unless otherwise specified. The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation”. The phrase “knowledge
of,” “the knowledge” and “have knowledge” as it relates to any Loan Party, shall be deemed to be the knowledge of the Responsible Officer of the Borrower.
(d) Any financial ratios required to be maintained by the Borrower pursuant to this Agreement shall be calculated by dividing the appropriate component by the other component, carrying the result to
one place more than the number of places by which such ratio is expressed in this Agreement and rounding the result up or down to the nearest number (with a round-up if there is no nearest number) to the number of places by which such ratio is
expressed in this Agreement.
(e) The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms.
(f) References to agreements, other contractual instruments and other documents include all subsequent amendments and other modifications to such agreement and documents, but only to the extent such
amendments and other modifications are not prohibited by the terms of any Loan Document. Except as otherwise specified or limited herein, references to any Person shall include such Person’s successors and assigns. Except as otherwise specified
herein, references to any law or regulation shall include references to such law or regulation as it may be amended, supplemented, modified or replaced from time to time.
(g) The following terms have the meanings given to them in the UCC: “Account,” “Account Debtor,” “Chattel Paper,” “Commercial Tort Claim,” “Commodity Account,” “Deposit Account,” “Document,”
“Electronic Chattel Paper,” “Fixtures,” “Goods,” “Health‑care‑insurance Receivable,” “Instrument,” “Inventory,” “Investment Property,” “Letter‑of‑Credit Rights,” “Money,” “Proceeds,” “Promissory Note,” “Purchase‑Money Obligation,” “Securities
Account” and “Supporting Obligations,” provided that “Instrument” has the meaning given in Article 9 of the UCC.
1.3 Leases. Notwithstanding anything to the contrary in this Agreement, the determination of whether
a lease is to be treated as an operating lease or capitalized lease shall be made without giving effect to any change in accounting for leases pursuant to GAAP resulting from the implementation of proposed Accounting Standards Update (ASU) 2016-02,
Leases (Topic 842) issued February 25, 2016, or any other implementation of proposed ASU Leases (Topic 842) issued May 16, 2013, or any successor proposal.
SECTION 2. AMOUNT AND TERMS OF LOANS AND LETTERS OF CREDIT; COMMITMENT AMOUNTS
2.1 Revolving Loans and Letters of Credit; Revolving Loan Commitments.
(a) Effective as of the Closing Date, any “Advances” (as defined in the Existing Loan Agreement) and any “Letters of Credit” (as defined in the Existing Loan Agreement) outstanding under the Existing
Loan Agreement shall be deemed outstanding as Revolving Loans and Letters of Credit, respectively, under this Agreement. Any “LIBOR Rate Loans” (as defined in the Existing Loan Agreement) that are “Advances” (as defined in the Existing Loan
Agreement) shall be “broken” immediately prior to the effectiveness of this Agreement and any “LIBOR Rate Loans” (as defined in the Existing Loan Agreement) that are “Advances” (as defined in the Existing Loan Agreement) that are outstanding
immediately prior to the effectiveness of this Agreement shall be converted by Borrower in accordance with the terms and conditions of this Agreement.
(b) Subject to the terms and conditions hereof, each Revolving Loan Lender severally agrees to (i) make additional loans on a revolving credit basis to the Borrower from time to time after the Closing
Date to but excluding the day that is two (2) Business Days prior to the Revolving Loan Commitment Expiration Date (each a “Revolving Loan”, and collectively, the “Revolving Loans”) in accordance with the terms of this Agreement and (ii) participate in standby letters of credit issued for the account of the Borrower pursuant to Section 2.19 from time to time from after the Closing Date to, but excluding, the day that is two (2) Business Days prior to the Revolving Loan Commitment Expiration Date (each a “Letter of Credit” and, collectively, the “Letters of Credit”); provided, however, that (A) the sum of (1) the aggregate principal amount of all Revolving Loans outstanding, (2) the aggregate Letter of
Credit Amount of all Letters of Credit outstanding, (3) the aggregate amount of unreimbursed drawings under all Letters of Credit and (4) the aggregate principal amount of all Swing Line Loans outstanding, shall not exceed the Aggregate Revolving
Loan Commitment at any time and (B) the sum of (1) the aggregate Letter of Credit Amount of all Letters of Credit outstanding and (2) the aggregate amount of unreimbursed drawings under all Letters of Credit shall not exceed $15,000,000 (the “Letter of Credit Sublimit”) at any time. Within the limits of each Revolving Loan Lender’s Revolving Loan Commitment, the Borrower may borrow Revolving Loans, and within the
Letter of Credit Sublimit have Letters of Credit issued for the Borrower’s account, prepay Revolving Loans, reborrow Revolving Loans, and have additional Letters of Credit issued for the Borrower’s account after the expiration of previously issued
Letters of Credit. Notwithstanding any provision in this Agreement to the contrary, Revolving Loans may not be borrowed on the Closing Date.
With respect to each Revolving Loan Lender, the principal amount of each (A) Revolving Loan to be made by such
Revolving Loan Lender and (B) participation of a Revolving Loan Lender in a Letter of Credit, shall be in an amount equal to the product of (i) such Revolving Loan Lender’s Revolving Loan Commitment Percentage (expressed as a fraction) and (ii) the
total amount of the Revolving Loan(s) and/or Letter(s) of Credit requested; provided that in no event shall any Revolving Loan Lender be obligated to make a Revolving Loan or
participate in a Letter of Credit if after giving effect to such Revolving Loan or such participation the sum of such Revolving Loan Lender’s (w) Revolving Loans outstanding, (x) Revolving Loan Commitment Percentage of the aggregate Letter of Credit
Amount of all Letters of Credit outstanding and (y) Revolving Loan Commitment Percentage of the aggregate amount of unreimbursed drawings under all Letters of Credit and Swing Line Loans outstanding, would exceed its Revolving Loan Commitment or if
the amount of such requested Revolving Loan, such Revolving Loan Lender’s Revolving Loan Commitment Percentage of such requested Letter of Credit or Swing Line Loans, is in excess of such Revolving Loan Lender’s Available Revolving Loan Commitment.
(c) Subject to Sections 2.11, 2.24 and 2.25 the Revolving Loans may from time to time be (i) LIBOR Loans, (ii) Base Rate Loans or (iii) a combination thereof, as determined by the Borrower and notified to the Agent in
accordance with either Section 2.1(e) or 2.5.
(d) Each Lender shall maintain in its internal records an account or accounts evidencing the Indebtedness hereunder of the Borrower to such Lender, including the amounts of the Revolving Loans made by
it and each repayment and prepayment in respect thereof. Any such recordation shall be conclusive and binding on the Borrower, absent manifest error; provided, failure to
make any such recordation, or any error in such recordation, shall not affect any Lender’s Revolving Loan Commitment or the Borrower’s Obligations in respect of any Revolving Loans; and provided further, in the event of any inconsistency between
the Register and any Lender’s records, the recordations in the Register shall govern. If so requested by any Lender by written notice to the Borrower (with a copy to the Agent), the Borrower shall execute and deliver to such Lender a Revolving
Note substantially in the form of Exhibit A-1 (a “Revolving Note”) to evidence such Lender’s Revolving
Loans.
(e) The Borrower shall give the Agent irrevocable written notice, substantially in the form of a Borrowing Notice (which notice must be received by the Agent prior to 10:00 a.m., Los Angeles time, on
the Business Day that is the proposed borrowing date or, if all or any part of the Revolving Loans are requested to be made as LIBOR Loans, at least three (3) Eurodollar Business Days prior to the proposed borrowing date) requesting that the
Revolving Loan Lenders make Revolving Loans on the proposed borrowing date and specifying (i) the aggregate amount of Revolving Loans requested to be made, (ii) subject to Sections 2.11, 2.24 and 2.25, whether the Revolving Loans are to be LIBOR
Loans, Base Rate Loans or a combination thereof and (iii) if the Revolving Loans are to be entirely or partly LIBOR Loans, the respective amounts of each such Type of Revolving Loan and the respective lengths of the initial Interest Periods
therefor. Notwithstanding the foregoing, such notice may be given by telephone, provided it is promptly confirmed on the same day in writing by delivery to the Agent of a written notice, substantially in the form of a Borrowing Notice. Upon
receipt of such notice, the Agent shall promptly notify each Revolving Loan Lender thereof on the date of receipt of such notice. On the proposed borrowing date, not later than 11:00 a.m., Los Angeles time, each Revolving Loan Lender shall make
available to the Agent the amount of such Revolving Loan Lender’s pro rata share of the aggregate borrowing amount (as determined in accordance with the second paragraph of Section
2.1(b)) in immediately available funds by wiring such amount to such account as the Agent shall specify. The Agent may, in the absence of notification from any Revolving Loan Lender that such Revolving Loan Lender has not made its
pro rata share available to the Agent on such date, credit the account of the Borrower on the books of the Agent (or credit such other account as the Borrower shall instruct the Agent in writing) with the aggregate amount of Revolving Loans.
(f) Neither the Agent nor any Revolving Loan Lender shall be responsible for the obligations or Revolving Loan Commitment of any other Revolving Loan Lender hereunder, nor will the failure of any
Revolving Loan Lender to comply with the terms of this Agreement relieve any other Revolving Loan Lender or the Borrower of its obligations under this Agreement.
(g) The Revolving Loan Commitment of each Revolving Loan Lender, and the Aggregate Revolving Loan Commitment, shall terminate on the Revolving Loan Commitment Expiration Date.
(h) All outstanding Revolving Loans shall be due and payable on the Revolving Loan Commitment Expiration Date.
2.2 Delayed Draw Term Loans; Delayed Draw Term Loan Commitment.
(a) Subject to the terms and conditions hereof, including without limitation, satisfaction of the requirements and conditions set forth in Section
4.2, each Delayed Draw Lender severally agrees to make term loans (each, a “Delayed Draw Term Loan” and collectively the “Delayed Draw Term Loans”) to the Borrower from time to time after the Closing Date to but excluding the Delayed Draw Term Loan Commitment Expiration Date for its use as permitted pursuant to Section 3.14(b); provided, that, (x) the aggregate principal amount of Delayed Draw Term Loans outstanding
shall not exceed the Delayed Draw Term Loan Commitment, and (y) each borrowing of Delayed Draw Term Loans shall be in the minimum principal amount of $2,500,000, and in integral multiples of $500,000 in excess thereof (or such other amounts agreed
to by the Agent in its sole discretion). The Delayed Draw Term Loan Commitment shall be reduced by the principal amount of Delayed Draw Term Loans made hereunder from time to time, and shall terminate on the Delayed Draw Term Loan Commitment
Expiration Date.
(b) Subject to Sections 2.11, 2.24 and 2.25, the Delayed Draw Term Loans may from time to time be (i) LIBOR Loans, (ii) Base Rate Loans or (iii) a combination thereof, as determined by the Borrower and notified to the
Agent in accordance with the terms of this Agreement.
(c) Each Lender shall maintain in its internal records an account or accounts evidencing the Indebtedness of the Borrower to such Lender, including the amount of the Delayed Draw Term Loans made by it
and each payment, repayment and prepayment in respect thereof. Any such recordation shall be conclusive and binding on the Borrower, absent manifest error; provided, failure
to make any such recordation, or any error in such recordation, shall not affect any Lender’s Delayed Draw Term Loan Commitment or the Borrower’s Obligations in respect of any Delayed Draw Term Loans; and provided further, in the event of any inconsistency between the Register and any Lender’s records, the recordations in the Register shall
govern. If so requested by any Lender by written notice to the Borrower (with a copy to the Agent), the Borrower shall execute and deliver to such Lender a Delayed Draw Term Note substantially in the form of Exhibit A-2 (a “Delayed Draw Term Note”) to evidence such Lender’s Delayed Draw Term Loans.
(d) The Borrower shall give the Agent irrevocable written notice, substantially in the form of a Borrowing Notice (which notice must be received by the Agent prior to 10:00 a.m., Los Angeles time, on
the Business Day preceding the proposed borrowing date or, if all or any part of the Delayed Draw Term Loans are requested to be made as LIBOR Loans, at least three (3) Eurodollar Business Days prior to the proposed borrowing date) requesting that
the Delayed Draw Lenders make Delayed Draw Term Loans on the proposed borrowing date and specifying (i) the aggregate amount of Delayed Draw Term Loans requested to be made, (ii) subject to Sections
2.11, 2.24 and 2.25, whether the Delayed Draw Term Loans are to be LIBOR Loans, Base
Rate Loans or a combination thereof, (iii) if the Delayed Draw Term Loans are to be entirely or partly LIBOR Loans, the respective amounts of each such Type of Delayed Draw Term Loan and the respective lengths of the initial Interest Periods
therefor, and (iv) the proposed use of such Delayed Draw Term Loans (along with the conditions required by Section 2.2(a) and any other applicable provisions of this
Agreement). Upon receipt of such notice and the satisfaction of the conditions set forth in Section 4.2, the Agent shall promptly notify each Delayed Draw Lender thereof on
the date of receipt of such notice. On the proposed borrowing date, not later than 11:00 a.m., Los Angeles time, each Delayed Draw Lender shall make available to the Agent the amount of such Delayed Draw Lender’s pro rata share of the aggregate
borrowing amount in immediately available funds by wiring such amount to such account as the Agent shall specify.
(e) The Agent may, in the absence of notification from any Delayed Draw Lender that such Delayed Draw Lender has not made its pro rata share available to the Agent on such date (or, if each such Lender
shall so have made available to the Agent such amount, the Agent shall), credit the account of the Borrower on the books of the Agent (or credit such other account as the Borrower shall instruct the Agent in writing) with the aggregate amount of
Delayed Draw Term Loans.
(f) On (i) August 19, 2022 (the “Initial Conversion Date”), the aggregate principal amount of all outstanding Delayed Draw Term
Loans shall be converted to a single term loan (the “Initial Combined Delayed Draw Term Loan”) and shall thereafter be repaid in equal consecutive quarterly installments, each
in an amount equal to 1/28th of the Initial Combined Delayed Draw Term Loan (each such amount an “Initial
DDTL Reduction Installment”), on the last Business Day of each fiscal quarter, commencing on the last Business Day of the fiscal quarter ending immediately after the Initial Conversion Date, through but excluding, the earlier of, the
Secondary Conversion Date or the Delayed Draw Term Loan Maturity Date; and (ii) August 19, 2023 (the “Secondary Conversion Date”), the aggregate principal amount of all
outstanding Delayed Draw Term Loans shall be converted to a single term loan and combined with the Initial Combined Delayed Draw Term Loan (the “Combined Delayed Draw Term Loan”)
and shall thereafter be repaid in equal consecutive quarterly installments, each in an amount equal to 1/28th of the Combined Delayed Draw Term Loan (each such amount
a “Secondary DDTL Reduction Installment”), on the last Business Day of each fiscal quarter, commencing on the last Business Day of the fiscal quarter ending immediately after
the Secondary Conversion Date, through but excluding, the Delayed Draw Term Loan Maturity Date. The remaining principal balance of all outstanding Delayed Draw Term Loans shall be due and payable on the Delayed Draw Term Loan Maturity Date. No
portion of any Delayed Draw Term Loan repaid under this Agreement shall be available for re-borrowing.
(g) Neither the Agent nor any other Lender shall be responsible for the obligations or Delayed Draw Term Loan Commitment of any other Lender hereunder, nor will the failure of any Delayed Draw Lender
to comply with the terms of this Agreement relieve any other Lender or the Borrower of its obligations under this Agreement.
2.3 Optional Prepayments; Optional Commitment Reductions. The Borrower may, at any time and from
time to time, subject to Section 2.14, prepay the Loans and/or permanently reduce the Aggregate Revolving Loan Commitment or the Delayed Draw Term Loan Commitment, in whole or
in part, upon at least one (1) Business Days’ written notice from the Borrower to the Agent, specifying the date and amount of prepayment and/or commitment reduction and, if a prepayment, whether the prepayment is of Revolving Loans, Swing Line
Loans or Delayed Draw Term Loans, or a combination thereof and, if of a combination thereof, the amount allocable to each, and whether the prepayment is of LIBOR Loans, Base Rate Loans or a combination thereof and, if of a combination thereof, the
amount allocable to each. Upon receipt of any such notice from the Borrower, the Agent shall promptly notify each Lender thereof. If any such notice is given, the amount specified in such notice shall be due and payable by the Borrower on the date
specified therein, together with accrued interest to such date on the amount prepaid. Any notice of prepayment of Loans and/or reduction or termination of Revolving Loan Commitments or Delayed Draw Term Loan Commitment delivered by the Borrower
under this Section may state that such notice is conditioned upon the effectiveness of other credit facilities, the receipt of the proceeds, the issuance of other Indebtedness or the occurrence of any other transaction, in which case such notice
may be revoked by the Borrower (by delivery of further written notice to the Agent as soon as practicable on or prior to the specified effective date) if such condition is not satisfied. Each prepayment of Loans under this Section 2.3 shall be applied, first, to the Delayed Draw Term Loans, as specified below, and second, to the outstanding principal balance of Revolving Loans (which, for the avoidance of doubt, shall not result in a reduction of any commitments thereunder). Each prepayment
of Delayed Draw Term Loans under this Section 2.3 shall be applied to the remaining Delayed Draw Term Reduction Installments in the inverse order of maturity (for the
avoidance of doubt, any amount that is due and payable on the Delayed Draw Term Loan Maturity Date shall constitute an installment). No Delayed Draw Term Loans prepaid under this Section
2.3 shall be available for reborrowing.
2.4 Mandatory Prepayments.
(a) (i) If at any time the sum of (A) the aggregate principal amount of all Revolving Loans outstanding
(other than Revolving Loans made for the purpose of repaying any Refunded Swing Line Loans or reimbursing the Issuing Bank for any amount drawn under any Letter of Credit, but not yet so applied or providing cash collateral pursuant to Section 2.19(h)), (B) the aggregate Letter of Credit Amount of all Letters of Credit outstanding, (C) the aggregate amount of unreimbursed drawings under all Letters of Credit and
(D) the aggregate principal amount of all Swing Line Loans outstanding, exceeds the Aggregate Revolving Loan Commitment, then the Borrower shall promptly, upon the earlier of knowledge thereof or notice by the Agent, prepay the Revolving Loans and/or
make a Cash Collateral Deposit with respect to Letters of Credit in an aggregate amount equal to such excess and (ii) prior to the Delayed Draw Term Loan Commitment Expiration Date, if at any time the aggregate principal amount of all Delayed Draw
Term Loans outstanding, exceeds the Aggregate Delayed Draw Term Loan Commitment, then the Borrower shall promptly, upon the earlier of knowledge thereof or notice by the Agent, prepay the Delayed Draw Term Loans in an aggregate amount equal to such
excess.
and the result of any of the foregoing shall be to increase the cost to the Agent, increase the cost to Issuing Bank of issuing any Letter
of Credit, or increase the cost to any such Lender of purchasing or maintaining any participation in a Letter of Credit or Swing Line Loan, or the Agent or such Lender of making, converting to, continuing or maintaining any Loan or of maintaining its
obligation to make any such Loan, or to reduce the amount of any sum received or receivable by the Agent or such Lender hereunder (whether of principal, interest or any other amount) then, upon request of the Agent or such Lender, the Borrower will pay
to the Agent or such Lender, as the case may be, such additional amount or amounts as will compensate the Agent or such Lender, as the case may be, for such additional costs incurred or reduction suffered.
A Lender shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or
otherwise, the circumstances entitling the Borrower to require such assignment and delegation cease to apply.
For the avoidance of doubt, (i) if the event giving rise to the Benchmark Replacement Date occurs on the same day as, but earlier than,
the Reference Time in respect of any determination, the Benchmark Replacement Date will be deemed to have occurred prior to the Reference Time for such determination and (ii) the “Benchmark Replacement Date” will be deemed to have occurred in the case
of clause (1) or (2) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).
To induce the Lenders to enter into this Agreement and to make the Loans and participate in the Letters of Credit, to
induce the Agent to enter into this Agreement and to induce the Issuing Bank to issue the Letters of Credit, the Borrower hereby represents and warrants to the Agent and the Lenders that:
Notwithstanding the foregoing, in no event shall any proceeds of any Loans or any Letters of Credit be used to refinance or repay any
Subordinated Debt, any Indebtedness owed to any Affiliate of Borrower or any preferred stock.
The Borrower hereby agrees that from and after the Closing Date, so long as any Loan remains outstanding and unpaid,
any Letter of Credit remains outstanding, any Commitment remains in effect or any other amount is due and owing to any Lender or the Agent hereunder (other than (i) any contingent indemnification obligations under which there is no outstanding claim or
(ii) Letters of Credit that have been cash collateralized or back stopped in a manner satisfactory to the Issuing Bank):