Filed Pursuant to Rule 424(b)(3)

Registration No. 333-260976

Registration No. 333-264085

Prospectus Supplement No. 7

(to Prospectus dated April 5, 2023)

Prospectus Supplement No. 7

(to Prospectus dated April 5, 2023)

 

WeWork Inc.

760,765,488 Shares of Class A Common Stock

7,773,333 Warrants to Purchase Class A Common Stock

 

 

This prospectus supplement is a supplement to the prospectus dated April 5, 2023, which forms a part of our Registration Statement on Form S-1 (File No. 333-260976) (as supplemented to date, the “First Prospectus”), and the prospectus dated April 5, 2023, which forms a part of our Registration Statement on Form S-1 (File No. 333-264085) (as supplemented to date, the “Second Prospectus” and, together with the First Prospectus, the “Prospectuses”). This prospectus supplement is not a new registration of securities but is being filed solely to update and supplement the information in the Prospectuses with the information contained in our Current Report on Form 8-K, filed with the Securities and Exchange Commission on May 8, 2023 (the “Current Report”). Accordingly, we have attached the Current Report to this prospectus supplement.

This prospectus supplement updates and supplements the information in the Prospectuses and is not complete without, and may not be delivered or utilized except in combination with, the Prospectuses, including any amendments or supplements thereto. This prospectus supplement should be read in conjunction with the Prospectuses and if there is any inconsistency between the information in the Prospectuses and this prospectus supplement, you should rely on the information in this prospectus supplement. The First Prospectus, together with this prospectus supplement, relate to (1) the issuance by us of up to 117,438,299 shares of Class A Common Stock, par value $0.0001 per share (the “Class A Common Stock”), including the shares that may be issued upon exercise of warrants to purchase Class A Common Stock at an exercise price of $11.50 per share of Class A Common Stock, consisting of the public warrants and the private placement warrants (each as defined in the First Prospectus); and (2) the offer and sale, from time to time, by the selling securityholders identified in the First Prospectus or their permitted transferees, of up to 642,774,807 shares of Class A Common Stock (including shares underlying warrants). The Second Prospectus, together with this prospectus supplement, relate to the offer and sale, from time to time, by the selling securityholders identified in the Second Prospectus or their permitted transferees, of up to 552,382 shares of Class A Common Stock (including shares underlying warrants) and up to 7,773,333 private placement warrants.

Our Class A Common Stock and warrants are traded on the New York Stock Exchange (“NYSE”) under the symbols “WE” and “WE WS,” respectively. On May 5, 2023, the closing price of our Class A common stock was $0.44 per share, and the closing price of our warrants was $0.04 per warrant.

 

 

Investing in our securities involves risks. See “Risk Factors” in the Prospectuses and in any applicable prospectus supplement.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities or determined if the Prospectuses or this prospectus supplement are truthful or complete. Any representation to the contrary is a criminal offense.

 

 

The date of this prospectus supplement is

May 8, 2023.

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 OR 15(d)

of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): May 8, 2023 (May 5, 2023)

 

 

WEWORK INC.

(Exact name of registrant as specified in its charter)

 

 

 

Delaware		001-39419		85-1144904
(State or other jurisdiction of incorporation)		(Commission File Number)		(I.R.S. Employer Identification No.)

 

75 Rockefeller Plaza, 10th Floor
New York, NY		10019
(Address of principal executive offices)		(Zip Code)

(646) 389-3922

(Registrant’s telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Class A common stock, par value $0.0001 per share		WE		The New York Stock Exchange
Warrants, each whole warrant exercisable for one share of Class A common stock		WE WS		The New York Stock Exchange
Class A Common Stock Purchase Rights		—		The New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 1.01

Entry into a Material Definitive Agreement

First Lien, Second Lien and Third Lien Notes Indentures

On May 5, 2023, WeWork Companies LLC (the “Issuer”) and WW Co-obligor Inc. (the “Co-Obligor” and, together with the Issuer, the “Issuers”), each a subsidiary of WeWork Inc. (the “Company”), consummated the previously announced offers to exchange (each an “Exchange Offer” and, together , the “Exchange Offers”) any and all of the Issuers’ 7.875% Senior Notes due 2025 (the “Old 7.875% Notes”) and 5.00% Senior Notes due 2025, Series II (the “Old 5.00% Notes” and, together with the Old 7.875% Notes, the “Old Notes”). In connection with the consummation of the Exchange Offers, the Issuers entered into (i) that certain First Lien Senior Secured PIK Notes Indenture, dated as of May 5, 2023 (the “First Lien Notes Indenture”), by and among the Issuers, the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee (in such capacity, the “Trustee”) and collateral agent (in such capacity the “Collateral Agent”), and issued $525 million in aggregate principal amount of 15.00% (7.00% Cash/8.00% PIK) First Lien Senior Secured PIK Notes due 2027, Series I (the “First Lien Notes”), thereunder, (ii) that certain Second Lien Senior Secured PIK Notes Indenture, dated as of May 5, 2023 (the “Second Lien Notes Indenture”), by and among the Issuers, the guarantors party thereto, the Trustee and the Collateral Agent, and issued $687 million in aggregate principal amount of 11.00% (5.00% Cash/6.00% PIK) Second Lien Senior Secured PIK Notes due 2027 (the “Second Lien Notes”) thereunder and (iii) that certain Third Lien Senior Secured PIK Notes Indenture, dated as of May 5, 2023, by and among the Issuers, the guarantors party thereto, the Trustee and the Collateral Agent, and issued $23 million in aggregate principal amount of 12.00% Third Lien Senior Secured PIK Notes due 2027 (the “Third Lien Notes”) thereunder.

First Lien Notes Indenture

Overview

In connection with the settlement of the Exchange Offers, the Issuers issued and sold $500 million in aggregate principal amount of First Lien Notes under the First Lien Notes Indenture to certain holders of Old Notes participating in the Exchange Offers. In addition, the Issuers issued $25 million in aggregate principal amount of additional First Lien Notes under the First Lien Notes Indenture to certain holders of Old Notes party to that certain Backstop Commitment Agreement, dated as of March 17, 2023, by and among the Issuers and the other parties thereto, as backstop commitment fee.

The First Lien Notes Indenture governs three series of notes, with same terms: (i) the $525 million in aggregate principal amount of First Lien Notes (15.00% First Lien Senior Secured PIK Notes due 2027, Series I), (ii) the up to $300 million in aggregate principal amount of SoftBank Delayed Draw Notes (as defined below) (15.00% First Lien Senior Secured PIK Notes due 2027, Series II) that may be issued and sold by the Issuers from time to time to SVF II (as defined below) pursuant to the First Lien NPA (as defined below) and (iii) the up to $175 million in aggregate principal amount of 15.00% First Lien Senior Secured PIK Notes due 2027, Series III, that may be issued and sold by the Issuers from time to time to a third party investor (the “Third Party Investor”) pursuant to that certain Securities Purchase and Commitment Agreement, dated as of March 17, 2023 (the “Third Party SPA”), by and among the Company, the Issuers and the Third Party Investor.

Interest, Security and Guarantees

The First Lien Notes will mature on August 15, 2027 and bear interest at a rate of 15.00% per annum, payable semi-annually in arrears, with 7.00% payable in cash and 8.00% payable in the form of PIK Interest (as defined, and in accordance with the terms set forth, in the First Lien Notes Indenture).

The First Lien Notes and the related guarantees are secured by a first-priority security interest (subject to permitted liens) in the existing and future assets of the Issuers and the Subsidiary Guarantors (as defined below) (other than cash collateral for the Issuer’s letter of credit facilities and certain other exceptions) that secure the Issuer’s letter of credit facilities, the other secured notes and certain other secured indebtedness of the Issuers or any Subsidiary Guarantors in excess of a specified threshold, subject to permitted liens and certain exceptions described herein (the “Collateral”).

The First Lien Notes are guaranteed, jointly and severally, fully and unconditionally, on a senior first-priority basis by each of the Issuer’s wholly-owned restricted subsidiaries that guarantee the Issuer’s obligations under the senior letter of credit facility and junior letter of credit facility under the Credit Agreement, dated as of December 27, 2019 (as amended, waived or otherwise modified from time to time) and certain other subsidiaries of the Issuer (collectively, the “Subsidiary Guarantors”). In addition, the First Lien Notes are guaranteed fully and unconditionally, on a senior unsecured basis, by the Company.

Redemption

Prior to November 1, 2024, the Issuers may redeem the First Lien Notes, in whole or in part, at a redemption price equal to 100% of the principal amount thereof, plus accrued and unpaid interest (including PIK Interest), if any, to (but not including) the applicable redemption date, plus the applicable “make-whole” premium.

In addition, at any time and from time to time prior to November 1, 2024, the Issuer may redeem up to 35% of the aggregate principal amount of First Lien Notes at a redemption price equal to 115% of the principal amount thereof, plus accrued and unpaid interest (including PIK Interest), if any, to (but not including) the redemption date, with an amount not to exceed the net cash proceeds from certain equity offerings.

At any time and from time to time on or after November 1, 2024, the Issuer may redeem the First Lien Notes, in whole or in part, at redemption price equal to 100% of the principal amount thereof, plus accrued and unpaid interest (including PIK Interest), if any, to (but not including) the applicable redemption date.

Change of Control

If a Change of Control (as defined in the First Lien Notes Indenture) occurs, the Issuer is required to make an offer to purchase all of the First Lien Notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to but not including the date of purchase.

Covenants and Events of Default

The terms of the First Lien Notes Indenture, among other things, substantially limit the Issuer’s ability to (i) declare or pay any dividend or make any distribution; (ii) purchase, redeem, or retire any equity interests of the Issuer held by persons other than the Issuer or a restricted subsidiary; (iii) make any principal payment on, or purchase, repurchase, redeem, or defease any restricted debt; or (iv) make any restricted investment. These covenants are subject to limited exceptions, limitations and qualifications that are described in the First Lien Notes Indenture.

The First Lien Notes Indenture provides for customary events of default (subject in certain cases to grace and cure periods), including with respect to payment defaults, failure to pay certain judgments and certain events of bankruptcy and insolvency. These events of default are subject to a number of important exceptions, limitations and qualifications that are described in the First Lien Notes Indenture.

 

3

The foregoing summary of the First Lien Notes Indenture and the First Lien Notes does not purport to be complete and is qualified in its entirety by reference to the complete terms of the First Lien Notes Indenture, which is filed as Exhibit 4.1 hereto, and the form of First Lien Notes, which is filed as Exhibit 4.2 hereto, each of which is incorporated by reference into this Item 1.01.

Second Lien Notes Indenture

In connection with the consummation of the Exchange Offers, the Issuers issued $687 million in aggregate principal amount of Second Lien Notes under the Second Lien Notes Indenture.

The terms of the Second Lien Notes are substantially similar to the terms of the First Lien Notes, except that: (i) the Second Lien Notes bear interest at a rate of 11.00% per annum, payable semi-annually in arrears, with 5.00% per annum payable in cash and 6.0% per annum payable in the form of PIK Interest (as defined, and in accordance with the terms set forth, in the First Lien Notes Indenture), (ii) the Second Lien Notes are secured by a second-priority lien on the Collateral and (iii) at any time and from time to time on or after the issue date, the Issuer may redeem the Second Lien Notes, in whole or in part, at 101.0% of the principal amount thereof, plus accrued and unpaid interest (including PIK Interest), if any, to (but not including) the applicable redemption date.

The foregoing summary of the Second Lien Notes Indenture and the Second Lien Notes does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Second Lien Notes Indenture, which is filed as Exhibit 4.3 hereto, and the form of Second Lien Notes, which is filed as Exhibit 4.4 hereto, each of which is incorporated by reference into this Item 1.01.

Third Lien Notes Indenture

In connection with the consummation of the Exchange Offers, the Issuers issued $270 million in aggregate principal amount of Third Lien Notes under the Third Lien Notes Indenture.

The terms of the Third Lien Notes are substantially similar to the terms of the First Lien Notes, except that: (i) the Third Lien Notes bear interest at a rate of 12.00% per annum, payable semi-annually in arrears solely in the form of PIK Interest (as defined, and in accordance with the terms set forth, in the Third Lien Notes Indenture), (ii) the Third Lien Notes are secured by a third-priority lien on the Collateral and (iii) at any time and from time to time on or after the issue date, the Issuer may redeem the Third Lien Notes, in whole or in part, at 101.0% of the principal amount thereof, plus accrued and unpaid interest (including PIK Interest), if any, to (but not including) the applicable redemption date.

The foregoing summary of the Third Lien Notes Indenture and the Third Lien Notes does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Third Lien Notes Indenture, which is filed as Exhibit 4.5 hereto, and the form of Third Lien Notes, which is filed as Exhibit 4.6 hereto, each of which is incorporated by reference into this Item 1.01.

Exchange Agreement, Exchangeable Notes Indentures and First Lien NPA

On May 5, 2023, in connection with the consummation of the Exchange Offers, and in accordance with the Transaction Support Agreement, dated as of March 17, 2023 (the “TSA”), the Issuers and SVF II Aggregator (Jersey) LP (“SVF II Aggregator”), SVF II WW Holdings (Cayman) Limited (“SVF II WW Holdings” and, together with SVF II Aggregator, the “SoftBank Unsecured Noteholders”)

 

4

and SoftBank Vision Fund II-2 L.P. (“SVF II” and, together with the SoftBank Unsecured Noteholders, the “SoftBank Parties”) entered into certain agreements and consummated certain transactions as described below.

Exchange Agreement and Exchangeable Indentures

Pursuant to that certain Exchange Agreement, dated as of May 5, 2023 (the “Exchange Agreement”), by and among the Company, the Issuers and the SoftBank Parties, the following transactions were consummated on May 5, 2023:

 

•

the exchange of all of the $1.65 billion in aggregate principal amount of the Issuers’ 5.00% Senior Notes due 2025, Series I, outstanding for (i) $187.5 million in aggregate principal amount of the Issuers’ 11.00% Second Lien Exchangeable Senior Secured PIK Notes due 2027 (the “Second Lien Exchangeable Notes”), issued pursuant to that certain Second Lien Exchangeable Senior Secured PIK Notes Indenture, dated as of May 5, 2023 (the “Second Lien Exchangeable Notes Indenture”), by and among the Issuers, the guarantors party thereto, the Trustee and the Collateral Agent, (ii) $269.6 million in aggregate principal amount of the Issuers’ 12.00% Third Lien Exchangeable Senior Secured PIK Notes due 2027 (the “Third Lien Exchangeable Notes” and, together with the Second Lien Exchangeable Notes, the “Exchangeable Notes”), issued pursuant to that certain Third Lien Exchangeable Senior Secured PIK Notes Indenture, dated as of May 5, 2023 (the “Third Lien Exchangeable Notes Indenture”), by and among the Issuers, the guarantors party thereto, the Trustee and the Collateral Agent and (iii) 1,112,900,605 shares of the Company’s Class A Common Stock, par value $0.0001 per share (the “Class A Common Stock”) (the foregoing transactions, the “SoftBank Exchange”); and

 

•

(i) the redemption of all of the $300 million in aggregate principal amount of Senior Secured Notes due 2025 (the “Secured Notes”) outstanding under that certain Senior Secured Notes Indenture, dated as of January 3, 2023, (ii) the termination of SVF II’s commitment to purchase up to $500 million in aggregate principal amount of Secured Notes pursuant to that certain Amended and Restated Master Senior Secured Notes Note Purchase Agreement, dated as of October 20, 2021 (as amended, waived or otherwise modified from time to time, the “Secured NPA”), by and among the Issuers and SVF II and (iii) the entry into the First Lien NPA (as defined below) (the foregoing transactions, the “SoftBank Rollover”).

The foregoing summary of the Exchange Agreement does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Exchange Agreement, which is filed as Exhibit 10.1 hereto and incorporated by reference into this Item 1.01.

Second Lien Exchangeable Notes Indenture

In connection with the consummation of the SoftBank Exchange, the Issuers issued $187.5 million in aggregate principal amount of Second Lien Exchangeable Notes under the Second Lien Exchangeable Notes Indenture.

Interest, Security and Guarantees

The Second Lien Exchangeable Notes will mature on August 15, 2027 and bear interest at a rate of interest at a rate of 11.00% per annum, payable semi-annually in arrears, with 5.00% per annum payable in cash and 6.0% per annum payable in the form of PIK Interest (as defined, and in accordance with the terms set forth, in the Second Lien Exchangeable Notes Indenture).

 

5

The Second Lien Exchangeable Notes and the related guarantees are secured by a second-priority security interest (subject to permitted liens) on the Collateral.

The Second Lien Exchangeable Notes are guaranteed, jointly and severally, fully and unconditionally, on a senior second-priority basis by the Subsidiary Guarantors. In addition, the Second Lien Exchangeable Notes are guaranteed fully and unconditionally, on a senior unsecured basis, by the Company.

Redemption

At any time and from time to time on or after the issue date, the Issuer may redeem the Second Lien Exchangeable Notes, in whole or in part, at 101.0% of the principal amount thereof, plus accrued and unpaid interest (including PIK Interest), if any, to (but not including) the applicable redemption date.

Change of Control

If a Change of Control (as defined in the Second Lien Exchangeable Notes Indenture) occurs, the Issuer is required to make an offer to purchase all of the Second Lien Exchangeable Notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to but not including the date of purchase.

Covenants and Events of Default

The terms of the Second Lien Exchangeable Notes Indenture, among other things, substantially limit the Issuer’s ability to (i) declare or pay any dividend or make any distribution; (ii) purchase, redeem, or retire any equity interests of the Issuer held by persons other than the Issuer or a restricted subsidiary; (iii) make any principal payment on, or purchase, repurchase, redeem, or defease any restricted debt; or (iv) make any restricted investment. These covenants are subject to limited exceptions, limitations and qualifications that are described in the Second Lien Exchangeable Notes Indenture.

The Second Lien Exchangeable Notes Indenture provides for customary events of default (subject in certain cases to grace and cure periods), including with respect to payment defaults, failure to pay certain judgments and certain events of bankruptcy and insolvency. These events of default are subject to a number of important exceptions, limitations and qualifications that are described in the Second Lien Exchangeable Notes Indenture.

Exchange Mechanics

At any time prior to the close of business on the second scheduled trading day immediately preceding the final maturity date of the Second Lien Exchangeable Notes, holders of the Second Lien Exchangeable Notes shall have the right, at their option, to surrender for exchange all or a portion of the Second Lien Exchangeable Notes at the Exchange Rate (as defined in the Second Lien Exchangeable Notes Indenture). The Exchange Rate is initially set at 832.8614 shares of Class A Common Stock per $1,000 in principal amount exchanged, which reflects a price of $1.20068 per share of Class A Common Stock, which price is equal to 130% the Common Equity VWAP (as defined in the Second Lien Exchangeable Notes Indenture). The Exchange Rate is subject to customary adjustments and anti-dilution protections. The Issuer may satisfy its exchange obligation either solely in cash, with shares of Class A Common Stock of the Company or with a combination of cash and shares of Class A Common Stock of the Company.

 

6

On or after November 5, 2024, and at any time until the close of business on the second scheduled trading day immediately preceding the final maturity date of the Second Lien Exchangeable Notes, if at any time (i) Wholly Owned Net Cash and Cash Equivalents and availability under Debt Facilities (each as defined in the Second Lien Exchangeable Notes Indenture) existing on the issue date is greater than $250 million and (ii) the Daily VWAP (as defined in the Second Lien Exchangeable Notes Indenture) of the shares of Class A Common Stock for a least 20 trading days (whether or not consecutive) during a period of 30 consecutive trading days is greater than or equal to 250% of the Common Equity VWAP, the Issuer shall be required to exchange all of the then outstanding principal amount of Second Lien Exchangeable Notes at the Exchange Rate then in effect.

The foregoing summary of the Second Lien Exchangeable Notes Indenture and the Second Lien Exchangeable Notes does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Second Lien Exchangeable Notes Indenture, which is filed as Exhibit 4.7 hereto, and the form of Second Lien Exchangeable Notes, which is filed as Exhibit 4.8 hereto, each of which is incorporated by reference into this Item 1.01.

Third Lien Exchangeable Notes Indenture

The terms of the Third Lien Exchangeable Notes are substantially similar to the terms of the Second Lien Exchangeable Notes, except that: (i) the Third Lien Exchangeable Notes bear interest at a rate of 12.00% per annum, payable semi-annually in arrears solely in the form of PIK Interest (as defined, and in accordance with the terms set forth, in the Third Lien Exchangeable Notes Indenture) and (ii) the Third Lien Exchangeable Notes are secured by a third-priority lien on the Collateral.

The foregoing summary of the Third Lien Exchangeable Notes Indenture and the Third Lien Exchangeable Notes does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Third Lien Exchangeable Notes Indenture, which is filed as Exhibit 4.9 hereto, and the form of Third Lien Exchangeable Notes, which is filed as Exhibit 4.10 hereto, each of which is incorporated by reference into this Item 1.01.

First Lien NPA

In connection with the SoftBank Rollover, the Issuers and SVF II entered into that certain Master First Lien Senior Secured PIK Notes Note Purchase Agreement, dated as of May 5, 2023 (the “First Lien NPA”), pursuant to which the Issuers agreed to issue and sell, at their option, and SVF II agreed to purchase, from time to time, up to $300 million in aggregate principal amount of 15.00% First Lien Senior Secured PIK Notes due 2027, Series II (the “SoftBank Delayed Draw Notes”), issued under the First Lien Notes Indenture. The SoftBank Delayed Draw Notes have the same terms, and are issued under the same indenture, but as a separate series, as the First Lien Notes.

The foregoing summary of the First Lien NPA does not purport to be complete and is qualified in its entirety by reference to the complete terms of the First Lien NPA, which is filed as Exhibit 10.2 hereto and incorporated by reference into this Item 1.01.

Registration Rights Agreement

In connection with the consummation of the Exchange Offers, the SoftBank Exchange and the Third Party Equity Sale (as defined below), and in accordance with the TSA, the Company entered into that certain Registration Rights Agreement, dated as of May 5, 2023 (the “Registration Rights Agreement”), with the SoftBank Unsecured Noteholders, the Third Party Investor and certain other holders who participated in the Exchange Offers (collectively, the “Holders”). Pursuant to the

 

7

Registration Rights Agreement, the Company must use its reasonable best efforts to file (i) a first registration statement registering the resale of the shares of Class A Common Stock issued to the Holders in connection with the transactions described in this Current Report on Form 8-K, no later than the first business day following the consummation of the Exchange Offers and (ii) a second registration statement to register the resale of the shares of Class A Common Stock issued to certain other holders who participated in the Exchange Offers and who provides certain registration information by a certain date as set forth therein, no later than the 20th business day after the consummation of the Exchange Offers.

The foregoing summary of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Registration Rights Agreement, which is filed as Exhibit 10.3 hereto and incorporated by reference into this Item 1.01.

Amended and Restated Stockholders Agreement

On May 5, 2023, the Company entered into an Amended and Restated Stockholders Agreement, by and among (i) the Company, (ii) SVF Endurance (Cayman) Limited (“SVF I”), (iii) SVF II WW Holdings and (iv) Benchmark Capital Partners VII (AIV), L.P. (the “Benchmark Investor” and together with SVF I and SVF II WW Holdings, the “Stockholders” and each a “Stockholder”) (the “Amended and Restated Stockholders Agreement”), which amended and restated the Company’s existing Stockholders Agreement, dated as of October 20, 2021 (the “Original Stockholders Agreement”).

The Amended and Restated Stockholders Agreement restates the terms of the Original Stockholders Agreement and, among other things, provides (i) for the appointment of two directors not designated by SVF I and SVF II WW Holdings (the “Independent Directors”), who as of May 5, 2023, were Daniel Hurwitz and Vivek Ranadivé and (ii) for the appointments of Alex Clavel, Vikas Parekh and David Tolley to the board of directors of the Company (the “Board”). The composition of the Board remains the same as was constituted immediately prior to the Company’s entry into the Amended and Restated Stockholders Agreement.

The Amended and Restated Stockholders Agreement also provides that (i) if, at any time the number of directors entitled to be designated by a Stockholder, decreases, then such Stockholder and the Company shall take all Necessary Action (as defined in the Amended and Restated Stockholders Agreement) to cause a sufficient number of directors designated by such Stockholder to resign from the Board at or prior to the end of such designated director’s term (as may be determined by the Independent Directors) and (ii) that if a vacancy on the Board arises as a result of (x) the Benchmark Investor or Insight Partners losing their Board designation rights or declining to exercise such rights, (y) the designation rights of SVF I or SVF II WW Holdings stepping down in accordance with the terms of the Amended and Restated Stockholders Agreement or (z) the death, removal or resignation of a director who was not nominated by any of the Stockholders, then such ensuing vacancy in each case shall be filled by a majority vote of the Independent Directors or a committee consisting entirely of Independent Directors.

The Amended and Restated Stockholders Agreement also modifies the Original Stockholders Agreement to provide that, so long as SVF I and SVF II WW Holdings collectively hold a number of shares of Class A Common Stock and Class C Common Stock, par value $0.0001 per share (the “Class C Common Stock”), of the Company, representing in excess of 49.90% of the then-outstanding voting securities of the Company, SVF I and SVF II WW Holdings shall take all Necessary Action to cause the voting restrictions set forth in Article V, Part A, Section 7 of the Company’s Second Amended and Restated Certificate of Incorporation, as amended, to remain in full force and effect.

Additionally, the Amended and Restated Stockholders Agreement provides that, so long as SVF I and SVF II WW Holdings collectively hold a number of shares of Class A Common Stock and Class C Common Stock representing at least 25% of the then-outstanding voting securities of the Company, (i) SVF I and SVF II WW Holdings are prohibited from taking any external actions to acquire the Company, or increasing their respective ownership of the Company’s voting securities, without first discussing such transaction with the Independent Directors, including as to the use of appropriate protections in such

 

8

transaction for the potential benefit of the Company’s stockholders other than SVF I and SVF II WW Holdings and (ii) the Company shall not, without the approval of a majority of the Independent Directors, amend, modify, supplement or waive any material terms of the Company’s related party transaction policy.

The foregoing summary of the Amended and Restated Stockholders Agreement does not purport to be complete and is qualified in its entirety by reference to the complete terms of the Amended and Restated Stockholders Agreement, which is filed as Exhibit 10.4 hereto and incorporated by reference into this Item 1.01.

 

Item 1.02

Termination of a Material Definitive Agreement

On May 5, 2023, in connection with the consummation of the SoftBank Rollover and pursuant to the Exchange Agreement, the Issuers and SVF II terminated SVF II’s commitment to purchase up to $500 million in aggregate principal amount of Secured Notes under the Secured NPA.

 

Item 2.03

Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The information set forth in Item 1.01 of this Current Report on Form 8-K under the headings “First Lien, Second Lien and Third Lien Notes Indentures” and “Exchange Agreement, Exchangeable Notes Indentures and First Lien NPA” are incorporated by reference into this Item 2.03.

 

Item 3.02

Unregistered Sales of Equity Securities

The information set forth under Item 1.01 of this Current Report on Form 8-K under the heading “Exchange Agreement, Exchangeable Notes Indentures and First Lien NPA” are incorporated herein by reference.

On May 5, 2023, the Company and the Issuers, as applicable, issued the following securities (among other securities):

 

•

250,373,598 shares of Class A Common Stock to holders of Old Notes participating in the Exchange Offers (the “Exchange Offers Shares”);

 

•

35,000,000 shares of Class A Common Stock to the third party investor pursuant to the Third Party SPA (the “Third Party Shares” and, such issuance, the “Third Party Equity Sale”);

 

•

1,112,900,605 shares of Class A Common Stock to SVF II WW Holdings pursuant to the Exchange Agreement and in connection with the SoftBank Exchange (the “SoftBank Exchange Shares”);

 

•

$187.5 million in aggregate principal amount of Second Lien Exchangeable Notes, which may be exchanged for 201,126,083 shares of Class A Common Stock at the current Exchange Rate, subject to the terms and conditions set forth in the Second Lien Exchangeable Notes Indenture; and

 

•

$269.6 million in aggregate principal amount of Third Lien Exchangeable Notes, which may be exchanged for 369,904,095 shares of Class A Common Stock at the current Exchange Rate, subject to the terms and conditions set forth in the Third Lien Exchangeable Notes Indenture.

 

 

9

The Exchange Offers Shares, the Third Party Shares, the SoftBank Exchange Shares, the shares of Class A Common Stock exchangeable for the Second Lien Exchangeable Notes and the shares of Class A Common Stock exchangeable for the Third Lien Exchangeable Notes are collectively referred to as the “Shares.”

The offerings of the Shares, the Exchangeable Notes and the related guarantees have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and the Shares, the Exchangeable Notes and the related guarantees were or will be issued in reliance upon the exemption provided in Section 4(a)(2) and/or Section 3(a)(9) of the Securities Act. The Exchangeable Notes are exchangeable for a certain number of shares of Class A Common Stock, as described in Item 1.01 of this Current Report on Form 8-K.

 

Item 8.01

Other Events

As previously announced, on April 16, 2023, following the receipt of the requisite consents in the consent solicitations commenced concurrently with the Exchange Offers, the Issuers entered into (i) the Fourteenth Supplemental Indenture, dated as of April 16, 2023 (the “Fourteenth Supplemental Indenture”), to the Senior Notes Indenture, dated as of April 30, 2018 (as amended or otherwise modified from time to time, the “Old 7.875% Notes Indenture”), governing the Old 7.875% Notes and (ii) the Fourth Supplemental Indenture, dated as of April 16, 2023 (the “Fourth Supplemental Indenture” and, together with the Fourteenth Supplemental Indenture, the “Supplemental Indentures”), to the Amended and Restated Senior Notes Indenture, dated as of December 16, 2021 (as amended or otherwise modified from time to time, the “Old 5.00% Notes Indenture” and, together with the Old 7.875% Notes Indenture, the “Old Indentures”), governing the Old 5.00% Notes. The Supplemental Indentures eliminated substantially all of the restrictive covenants, eliminated certain events of default, modified covenants regarding mergers and consolidations and modified or eliminated certain other provisions, including certain provisions relating to future guarantors and defeasance contained in the Old Notes Indentures and the Old Notes. Upon the consummation of the Exchange Offers on May 5, 2023, the Supplemental Indentures became operative.

 

Item 9.01

Financial Statements and Exhibits.

(d) Exhibits.

 

Exhibit Number		Description
4.1		First Lien Senior Secured PIK Notes Indenture, dated as of May 5, 2023, by and among WeWork Companies LLC, WW Co-Obligor Inc., the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee and collateral agent.
4.2		Form of 15.000% First Lien Senior Secured PIK Notes due 2027 (included as Exhibit A to Exhibit 4.1 hereto).
4.3		Second Lien Senior Secured PIK Notes Indenture, dated as of May 5, 2023, by and among WeWork Companies LLC, WW Co-Obligor Inc., the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee and collateral agent.
4.4		Form of 11.000% Second Lien Senior Secured PIK Notes due 2027 (included as Exhibit A to Exhibit 4.3 hereto).
4.5		Third Lien Senior Secured PIK Notes Indenture, dated as of May 5, 2023, by and among WeWork Companies LLC, WW Co-Obligor Inc., the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee and collateral agent.

 

10

4.6		Form of 12.000% Third Lien Senior Secured PIK Notes due 2027 (included as Exhibit A to Exhibit 4.5 hereto).
4.7		Second Lien Exchangeable Senior Secured PIK Notes Indenture, dated as of May 5, 2023, by and among WeWork Companies LLC, WW Co-Obligor Inc., the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee and collateral agent.
4.8		Form of 11.000% Second Lien Exchangeable Senior Secured PIK Notes due 2027 (included as Exhibit A to Exhibit 4.7 hereto).
4.9		Third Lien Exchangeable Senior Secured PIK Notes Indenture, dated as of May 5, 2023, by and among WeWork Companies LLC, WW Co-Obligor Inc., the guarantors party thereto and U.S. Bank Trust Company, National Association, as trustee and collateral agent.
4.10		Form of 12.000% Third Lien Exchangeable Senior Secured PIK Notes due 2027 (included as Exhibit A to Exhibit 4.9 hereto).
10.1		Exchange Agreement, dated as of May 5, 2023, by and among WeWork Inc., WeWork Companies LLC, WW Co-Obligor Inc., SVF II Aggregator (Jersey) LP, SVF II WW Holdings (Cayman) Limited and SoftBank Vision Fund II-2 L.P.
10.2		Master First Lien Senior Secured PIK Notes Note Purchase Agreement, dated as of May 5, 2023, by and among WeWork Companies LLC, WW Co-Obligor Inc. and SoftBank Vision Fund II-2 L.P.
10.3		Registration Rights Agreement, dated as of May 5, 2023, by and among WeWork Inc. and the holders listed thereto.
10.4		Amended and Restated Stockholders Agreement, dated as of May 5, 2023, by and among WeWork Inc., SVF Endurance (Cayman) Limited, SVF II WW Holdings (Cayman) Limited and Benchmark Capital Partners VII (AIV), L.P.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document).

 

 

11

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.

 

Date: May 8, 2023				WEWORK INC.
				By:		/s/ Andre Fernandez
				Name: Andre Fernandez
				Title: Chief Financial Officer

Exhibit 4.1

EXECUTION VERSION

 

 

FIRST LIEN SENIOR SECURED PIK NOTES INDENTURE

Dated as of May 5, 2023

Among

WEWORK COMPANIES LLC,

WW CO-OBLIGOR INC.,

THE GUARANTORS LISTED ON THE SIGNATURE PAGES HERETO

and

U.S. BANK TRUST COMPANY, NATIONAL ASSOCIATION,

as Trustee and Collateral Agent

15.000% FIRST LIEN SENIOR SECURED PIK NOTES DUE 2027

 

 

TABLE OF CONTENTS

 

 

 

				PAGE
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE					1
Section 1.01.		Definitions			1
Section 1.02.		Other Definitions			51
Section 1.03.		Rules of Construction			53
Section 1.04.		Acts of Holders			54
Section 1.05.		No Incorporation by Reference of Trust Indenture Act			56
ARTICLE 2
THE FIRST LIEN NOTES					56
Section 2.01.		Form and Dating; Terms			56
Section 2.02.		Execution and Authentication			57
Section 2.03.		Registrar and Paying Agent			58
Section 2.04.		Paying Agent to Hold Money and PIK Notes in Trust			58
Section 2.05.		Holder Lists			58
Section 2.06.		Transfer and Exchange			59
Section 2.07.		Replacement First Lien Notes			60
Section 2.08.		Outstanding First Lien Notes			60
Section 2.09.		Treasury Notes			61
Section 2.10.		Temporary First Lien Notes			61
Section 2.11.		Cancellation			61
Section 2.12.		Defaulted Interest			62
Section 2.13.		CUSIP and ISIN Numbers			62
Section 2.14.		PIK Interest			62
Section 2.15.		Series II and Series III First Lien Notes			63
ARTICLE 3
REDEMPTION					64
Section 3.01.		Notices to Trustee			64
Section 3.02.		Selection of First Lien Notes to Be Redeemed or Purchased			64
Section 3.03.		Notice of Redemption			65
Section 3.04.		Effect of Notice of Redemption			66
Section 3.05.		Deposit of Redemption or Purchase Price			66
Section 3.06.		First Lien Notes Redeemed or Purchased in Part			67
Section 3.07.		Optional Redemption			67
Section 3.08.		Mandatory Redemption; Open Market Purchases			68
Section 3.09.		Offers to Repurchase by Application of Excess Proceeds			68

 

i

ARTICLE 4
COVENANTS					70
Section 4.01.		Payment of First Lien Notes			70
Section 4.02.		Maintenance of Office or Agency			70
Section 4.03.		[Reserved]			71
Section 4.04.		Stay, Extension and Usury Laws			71
Section 4.05.		Corporate Existence			71
Section 4.06.		Reports and Other Information			71
Section 4.07.		Compliance Certificate			74
Section 4.08.		Limitation on Restricted Payments			74
Section 4.09.		Limitation on Indebtedness			78
Section 4.10.		Limitation on Liens			84
Section 4.11.		Future Guarantors			85
Section 4.12.		Limitation on Restrictions on Distribution From Restricted Subsidiaries			85
Section 4.13.		Designation of Restricted and Unrestricted Subsidiaries			87
Section 4.14.		Transactions with Affiliates			88
Section 4.15.		Offer to Repurchase Upon Change of Control			91
Section 4.16.		Asset Dispositions			92
Section 4.17.		[Reserved]			95
Section 4.18.		Maintenance of Property; Insurance			95
Section 4.19.		After-Acquired Collateral			95
Section 4.20.		Limitation on Material Intellectual Property Dispositions			95
Section 4.21.		Asset Dispositions by Unrestricted Subsidiaries and WeWork Japan GK			95
Section 4.22.		Ratings			96
ARTICLE 5
SUCCESSORS					96
Section 5.01.		Merger, Consolidation or Sale of All or Substantially All Assets			96
Section 5.02.		Successor Entity Substituted			98
ARTICLE 6
DEFAULTS AND REMEDIES					99
Section 6.01.		Events of Default			99
Section 6.02.		Acceleration			103
Section 6.03.		Other Remedies			105
Section 6.04.		Waiver of Past Defaults			105
Section 6.05.		Control by Majority			105
Section 6.06.		Limitation on Suits			106
Section 6.07.		Rights of Holders to Receive Payment			106
Section 6.08.		Collection Suit by Trustee			106
Section 6.09.		Restoration of Rights and Remedies			106
Section 6.10.		Rights and Remedies Cumulative			107

 

ii

Section 6.11.		Delay or Omission Not Waiver			107
Section 6.12.		Trustee May File Proofs of Claim			107
Section 6.13.		Priorities			108
Section 6.14.		Undertaking for Costs			108
ARTICLE 7
TRUSTEE					108
Section 7.01.		Duties of Trustee			108
Section 7.02.		Rights of Trustee			109
Section 7.03.		Individual Rights of Trustee			111
Section 7.04.		Trustee’s Disclaimer			111
Section 7.05.		Notice of Defaults			111
Section 7.06.		Compensation and Indemnity			111
Section 7.07.		Replacement of Trustee			112
Section 7.08.		Successor Trustee by Merger, etc			113
Section 7.09.		Eligibility; Disqualification			113
Section 7.10.		Preferential Collection of Claims Against the Company			113
Section 7.11.		Limitation on Duty of Trustee and the Collateral Agent in Respect of Collateral; Indemnification			114
ARTICLE 8
LEGAL DEFEASANCE AND COVENANT DEFEASANCE					114
Section 8.01.		Option to Effect Legal Defeasance or Covenant Defeasance			114
Section 8.02.		Legal Defeasance and Discharge			114
Section 8.03.		Covenant Defeasance			115
Section 8.04.		Conditions to Legal or Covenant Defeasance			116
Section 8.05.		Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions			117
Section 8.06.		Repayment to the Company			117
Section 8.07.		Reinstatement			118
ARTICLE 9
AMENDMENT, SUPPLEMENT AND WAIVER					118
Section 9.01.		Without Consent of Holders			118
Section 9.02.		With Consent of Holders			120
Section 9.03.		Revocation and Effect of Consents			124
Section 9.04.		Notation on or Exchange of First Lien Notes			124
Section 9.05.		Trustee to Sign Amendments, etc			124
ARTICLE 10
GUARANTEES					125
Section 10.01.		Guarantee			125
Section 10.02.		Limitation on Guarantor Liability			126
Section 10.03.		Execution and Delivery			127

 

iii

Section 10.04.		Subrogation			127
Section 10.05.		Benefits Acknowledged			127
Section 10.06.		Release of Note Guarantees			127
Section 10.07.		Co-Obligor			128
ARTICLE 11
SATISFACTION AND DISCHARGE					128
Section 11.01.		Satisfaction and Discharge			128
Section 11.02.		Application of Trust Money			129
ARTICLE 12
COLLATERAL					130
Section 12.01.		Security Documents			130
Section 12.02.		Further Assurances			130
Section 12.03.		Collateral Agent			130
Section 12.04.		Authorization of Actions to Be Taken			138
Section 12.05.		Release of Collateral			138
Section 12.06.		Powers Exercisable by Receiver or Trustee			140
Section 12.07.		Release upon Termination of Company’s Obligations			140
ARTICLE 13
MISCELLANEOUS					140
Section 13.01.		Notices			140
Section 13.02.		Certificate and Opinion as to Conditions Precedent			142
Section 13.03.		Statements Required in Certificate or Opinion			142
Section 13.04.		Rules by Trustee and Agents			143
Section 13.05.		No Personal Liability of Directors, Officers, Employees, Members, Partners and Stockholders			143
Section 13.06.		Governing Law			143
Section 13.07.		Waiver of Jury Trial; Consent to Jurisdiction			143
Section 13.08.		Force Majeure			144
Section 13.09.		No Adverse Interpretation of Other Agreements			144
Section 13.10.		Successors			144
Section 13.11.		Severability			144
Section 13.12.		Counterpart Originals			144
Section 13.13.		Electronic Transmission; Electronic Signatures			144
Section 13.14.		Table of Contents, Headings, etc			144
Section 13.15.		Facsimile and PDF Delivery of Signature Pages			145
Section 13.16.		U.S.A. PATRIOT Act			145
Section 13.17.		Payments Due on Non-Business Days			145
Section 13.18.		First Lien/Second Lien/Third Lien Intercreditor Agreement			145
Appendix A		Provisions Relating to the First Lien Notes
Exhibit A		Form of First Lien Note
Exhibit B		Form of Institutional Accredited Investor Transferee Letter of Representation
Exhibit C		Form of Supplemental Indenture to Be Delivered by Subsequent Guarantors

 

 

iv

FIRST LIEN SENIOR SECURED PIK NOTES INDENTURE, dated as of May 5, 2023, by and among WeWork Companies LLC, a limited liability company incorporated under the laws of Delaware (the “Company”), WW Co-Obligor Inc., a Delaware corporation (the “Co-Obligor”), the Guarantors listed on the signature pages hereto and U.S. Bank Trust Company, National Association, a national banking association organized under the laws of the United States, as Trustee and as Collateral Agent.

W I T N E S S E T H

WHEREAS, the Company has duly authorized the creation and issue of $525,000,000 in aggregate principal amount of 15.000% First Lien Senior Secured PIK Notes due 2027, Series I (excluding PIK Notes (as defined below), the “Initial Series I Notes”);

WHEREAS, the Company and Co-Obligor are party to (i) the First Lien NPA, pursuant to which the Company and Co-Obligor agreed to issue and sell, from time to time at their option, and the Series II Purchaser agreed to purchase, up to $300 million in aggregate principal amount of 15.000% First Lien Senior Secured PIK Notes due 2027, Series II (together with the $6.25 million in aggregate principal amount of 15.000% First Lien Senior Secured PIK Notes due 2027, Series II, issuable to the Series II Purchaser as a commitment fee pursuant to the First Lien SPA, and excluding other PIK Notes, the “Initial Series II Notes”) and (ii) the Third Party Investor Purchase Agreement, pursuant to which the Company and Co-Obligor agreed to issue and sell, from time to time at their option, and the Third Party Investor agreed to purchase, up to $175 million in aggregate principal amount of 15.000% First Lien Senior Secured PIK Notes due 2027, Series III (together with the $6.25 million in aggregate principal amount of 15.000% First Lien Senior Secured PIK Notes due 2027, Series III, issuable as a commitment fee to the Third Party Investor pursuant to the Third Party Investor Purchase Agreement, and excluding other PIK Notes, the “Initial Series III Notes”); and

WHEREAS, the Guarantors have duly authorized the execution and delivery of this First Lien Indenture.

NOW, THEREFORE, the Company, the Co-Obligor, the Guarantors, the Trustee and the Collateral Agent agree as follows for the benefit of each other and for the equal and ratable benefit of the Holders of the First Lien Notes.

ARTICLE 1

DEFINITIONS AND INCORPORATION BY REFERENCE

Section 1.01. Definitions.

“Acquired Indebtedness” means, with respect to any specified Person, (1) Indebtedness, Disqualified Stock or Preferred Stock of any other Person or any of its Subsidiaries existing at the time such other Person is merged, consolidated or amalgamated with or into such specified Person or becomes a Restricted Subsidiary of such specified Person or (2) Indebtedness assumed in connection with the acquisition of assets from such Person, in each case so long as such Indebtedness (x) was not Incurred by such Person in connection with, or in anticipation or contemplation of, such Person becoming a Restricted Subsidiary or such acquisition and (y) is non-recourse to the Company or any other Restricted Subsidiary (other than any Person that becomes a Subsidiary in connection with the foregoing and its Subsidiaries). Acquired Indebtedness shall be deemed to have been Incurred, with respect to clause (1) of the preceding sentence, on the date such Person is merged, consolidated or amalgamated with or into such specified Person or becomes a Restricted Subsidiary and, with respect to clause (2) of the preceding sentence, on the date of consummation of such acquisition of assets.

“Additional Assets” means:

 

(1)

any property, plant, equipment or other asset to be used by the Company or a Restricted Subsidiary in a Permitted Business;

 

(2)

the Capital Stock of a Person that becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock by the Company or a Restricted Subsidiary; or

 

(3)

Capital Stock constituting a minority interest in any Person that at such time is a Restricted Subsidiary;

provided, however, that, in the case of clauses (2) and (3), such Restricted Subsidiary is primarily engaged in a Permitted Business.

“Additional Secured Debt Designation” means the written agreement of the holders of any Series of Parity Lien Debt, their Parity Lien Representative, as set forth in this First Lien Indenture, or any other agreement governing such Series of Parity Lien Debt, for the benefit of (i) all holders of each existing and future Series of Parity Lien Debt, the Collateral Agent, and each existing and future holder of Parity Liens, and (ii) if applicable, all holders of each existing and future Series of Junior Lien Debt and the Junior Lien Collateral Agent, in each case:

(a) that all Parity Lien Obligations will be and are secured equally and ratably by all Parity Liens at any time granted by the Company or any Guarantor to secure any Obligations in respect of such Series of Parity Lien Debt, whether or not upon property otherwise constituting collateral for such Series of Parity Lien Debt, and that all such Parity Liens will be enforceable by the Collateral Agent for the benefit of all holders of Parity Lien Obligations equally and ratably;

(b) that such Parity Lien Representative and the holders of Obligations in respect of such Series of Parity Lien Debt are bound by the provisions of the First Lien/Second Lien/Third Lien Intercreditor Agreement, including the provisions relating to the ranking of Parity Liens and the order of application of proceeds from the enforcement of Parity Liens; and

(c) appointing the Collateral Agent and consenting to the terms of the First Lien/Second Lien/Third Lien Intercreditor Agreement and the performance by the Collateral Agent of, and consenting to and directing the Collateral Agent to perform its obligations under the Collateral Agency Agreement or applicable security documents, as applicable, and the First Lien/Second Lien/Third Lien Intercreditor Agreement, together with all such powers as are reasonably incidental thereto.

“Adjusted EBITDA” means, with respect to any Person for any period, the Consolidated Net Income of such Person and its Restricted Subsidiaries for such period:

(1) plus, without duplication and to the extent reflected as a charge in the statement of such Consolidated Net Income for such period, the sum of:

 

(a)

Consolidated Interest Expense;

 

2

(b)

Consolidated Income Taxes;

 

(c)

depreciation and amortization expense, including amortization of intangibles (including, but not limited to, goodwill) and organization costs;

 

(d)

impairment charges recorded in connection with the application of Accounting Standards Codification Topic 350, Intangibles—Goodwill and Other, or Topic 360, Property, Plant and Equipment;

 

(e)

any extraordinary, unusual or non-recurring expenses or losses (including, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, losses on sales of assets outside of the ordinary course of business);

 

(f)

non-cash charges, non-cash expenses or non-cash losses for such period (excluding any such charge, expense or loss Incurred in the ordinary course of business that constitutes an accrual of, or a reserve for, cash charges for any future period, other than accruals for (i) straight-line rent expense on leases that include future rent escalations, (ii) asset retirement obligations, and (iii) other non-cash accruals included in consolidated rent expenses under GAAP, which may involve future cash charges), including any non-cash compensation expense and any expense related to the issuance of equity to non-employees for services rendered;

 

(g)

real estate commissions (in connection with the execution of leases) received in cash in such period to the extent not otherwise included in Consolidated Net Income for such period;

 

(h)

charges, costs, fees and expenses Incurred in connection with this First Lien Indenture, the Transactions, any acquisition, Investment, Asset Disposition or other disposition, and the Incurrence, issuance or amendment of any Indebtedness or Equity Interests, in each case whether or not such transaction is successful or consummated for such period;

 

(i)

any restructuring charges or expenses, integration costs or other business optimization charges or expenses; provided that the amounts referred to in this clause (i) shall not, in the aggregate, exceed 15.00% of Adjusted EBITDA in the most recent four consecutive fiscal quarters of the Company (calculated before giving effect to such amounts pursuant to this clause (i)); and

 

(j)

bonuses paid to executives in connection with any strategic transaction or offering of Equity Interests;

(2) minus, without duplication and to the extent included in the statement of such Consolidated Net Income for such period, the sum of:

 

(a)

any non-cash items to the extent increasing such Consolidated Net Income (excluding any such items which represent the recognition of deferred revenue, the reversal of any accrual of, or reserve for, anticipated cash charges that reduced Adjusted EBITDA in any prior period, and any such items for which cash was received in a prior period that did not increase Adjusted EBITDA in any prior period); and

 

(b)

if Consolidated Income Taxes is a benefit, the amount of such benefit;

 

3

(3) minus the aggregate amount of Investments made by the Company and its Restricted Subsidiaries in ChinaCo and its Restricted Subsidiaries during such period and outstanding at the end of such period;

(4) plus or minus, without duplication and to the extent reflected in such Consolidated Net Income for such period, the following items to be excluded for the purposes of calculating Adjusted EBITDA:

 

(a)

any income or loss from the early extinguishment of Indebtedness or early termination of Hedging Obligations or other derivative instruments;

 

(b)

any unrealized net gain or loss resulting in such period from Hedging Obligations and the application of Accounting Standards Codification Topic 815, Derivatives and Hedging;

 

(c)

any net income or loss included in the consolidated statement of operations with respect to non-controlling interests due to the application of Accounting Standards Codification Topic 810, Consolidation;

 

(d)

any net gain or loss resulting in such period from currency translation or remeasurement gains or losses pursuant to Accounting Standards Codification Topic 830, Foreign Currency Matters;

 

(e)

effects of adjustments (including the effects of such adjustments pushed down to the Company and its Restricted Subsidiaries) in any line item in such Person’s consolidated financial statements in such period pursuant to GAAP resulting from the application of purchase accounting in relation to any completed acquisition; and

 

(f)

the cumulative effect of a change in accounting principles;

provided that the Adjusted EBITDA of ChinaCo and its Restricted Subsidiaries shall be excluded in computing Adjusted EBITDA to the extent otherwise included in computing Adjusted EBITDA.

Notwithstanding the foregoing, clauses (1)(b) through (j) relating to amounts of a Restricted Subsidiary of a Person will be added to Consolidated Net Income to compute Adjusted EBITDA of such Person only to the extent (and in the same proportion) that the net income (loss) of such Restricted Subsidiary was included in calculating the Consolidated Net Income of such Person.

“Affiliate” of any specified Person means any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled by” and “under common control with”) when used with respect to any Person means possession, directly or indirectly, of the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.

 

4

“Agent” means any Registrar or Paying Agent.

“Applicable Premium” means, with respect to a First Lien Note on any date of redemption, the greater of: (1) 1.00% of the principal amount of such First Lien Note, and (2) the excess, if any, of (a) the present value as of such date of redemption of (i) the redemption price of such First Lien Note on November 1, 2024 plus (ii) all required interest payments due on such First Lien Note through November 1, 2024 (excluding accrued but unpaid interest to but excluding the date of redemption), computed using a discount rate equal to the Treasury Rate as of such date of redemption plus 50 basis points, over (b) the then outstanding principal amount of such First Lien Note.

“Asset Disposition” means any direct or indirect sale, lease (other than a lease entered into in the ordinary course of business (whether or not consistent with past practice)), transfer, issuance or other disposition, or a series of related sales, leases, transfers, issuances or dispositions that are part of a common plan, of shares of Capital Stock of a Restricted Subsidiary (other than directors’ qualifying shares), property or other assets (each referred to for the purposes of this definition as a “disposition”) by the Company or any of its Restricted Subsidiaries, including any disposition by means of a merger, consolidation or similar transaction.

Notwithstanding the preceding, the following items shall not be deemed to be Asset Dispositions:

(1) a disposition of assets by a Restricted Subsidiary to the Company or by the Company or a Restricted Subsidiary to a Restricted Subsidiary;

(2) a disposition of Cash Equivalents in the ordinary course of business (whether or not consistent with past practice);

(3) a disposition of an account receivable in connection with the collection or compromise thereof in the ordinary course of business (whether or not consistent with past practice);

(4) a disposition of obsolete, surplus, damaged or worn-out assets or assets that are no longer useful in the conduct of the business of the Company and its Restricted Subsidiaries;

(5) the disposition of all or substantially all of the assets of the Company in a manner permitted pursuant to Section 5.01 or any disposition that constitutes a Change of Control pursuant to this First Lien Indenture;

(6) the sale or issuance of Capital Stock by a Restricted Subsidiary to the Company or to another Restricted Subsidiary;

(7) the making of a Permitted Investment or a disposition that is permitted pursuant to Section 4.08;

 

5

(8) dispositions of assets in a single transaction or a series of related transactions with an aggregate Fair Market Value of less than $25.00 million;

(9) the creation of a Permitted Lien and dispositions in connection with Permitted Liens;

(10) dispositions of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of business (whether or not consistent with past practice) or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements;

(11) the sale or issuance by a Restricted Subsidiary of Preferred Stock that is permitted by Section 4.09;

(12) the licensing or sublicensing of intellectual property or other general intangibles and licenses, leases or subleases of other property in the ordinary course of business (whether or not consistent with past practice) which do not materially interfere with the business of the Company and its Restricted Subsidiaries, taken as a whole;

(13) foreclosure on, or condemnation or expropriation of, assets and the surrender or waiver of contract rights or the settlement, release or surrender of contract, tort or other claims;

(14) the unwinding of any Hedging Obligations or Cash Management Obligations;

(15) dispositions of Investments in joint ventures to the extent required by, or made pursuant to, customary buy/sell arrangements between the joint venture parties set forth in joint venture agreements and similar binding agreements;

(16) issuances, sales or pledges of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary;

(17) dispositions of property consisting of tenant improvements at a location in connection with the termination of the lease for such location or cessation of operations at such location;

(18) any financing transaction with respect to property built or acquired by the Company or any Restricted Subsidiary after the Issue Date, including, without limitation, Sale/Leaseback Transactions permitted by this First Lien Indenture; and

(19) any disposition or termination of leases of the Company or any Restricted Subsidiaries and related payment (including, but not limited to, as part of termination agreements, settlement agreements or lease amendments) in connection therewith.

“Asset Swap” means an exchange (or concurrent purchase and sale) of property, plant, equipment or other assets (including Capital Stock of a Restricted Subsidiary) of the Company or any of its Restricted Subsidiaries for Additional Assets of another Person.

“Attributable Indebtedness” in respect of a Sale/Leaseback Transaction means, as at the time of determination, the present value (discounted at the interest rate implicit in the transaction) of the total obligations of the lessee for rental payments during the remaining term of the lease included in such Sale/Leaseback Transaction (including any period for which such lease has been extended), determined in accordance with GAAP; provided, however, that if such Sale/Leaseback Transaction results in a Capitalized Lease Obligation, the amount of Indebtedness represented thereby will be determined in accordance with the definition of “Capitalized Lease Obligations.”

 

6

“Average Life” means, as of the date of determination, with respect to any Indebtedness, Disqualified Stock or Preferred Stock, the quotient obtained by dividing:

(1) the sum of the products obtained by multiplying (a) the amount of each successive scheduled principal payment of such Indebtedness or redemption or similar payment with respect to such Disqualified Stock or Preferred Stock by (b) the number of years (calculated to the nearest one-twelfth) from the date of determination to the date of such payment; by

(2) the sum of the amounts of all such payments.

“Authorized Representative” means, at any time, (i) in the case of any Letter of Credit Facility Obligations or the Letter of Credit Facility secured parties, the Senior Tranche Administrative Agent, (ii) in the case of the First Lien Notes, the Collateral Agent, and (iii) in the case of any future Series of Parity Lien Debt, the trustee, agent or representative of the holders of such Series of Parity Lien Debt who maintains the transfer register for such Series of Parity Lien Debt.

“Bank Facility” means the Letter of Credit Facility.

“Bankruptcy Code” means Title 11 of the United States Code.

“Bankruptcy Law” means the Bankruptcy Code and any similar federal, state or foreign law providing for the relief of debtors.

“beneficial ownership” has the meaning assigned to such term in Rules 13d-3 and 13d-5 under the Exchange Act, and “beneficial owner” has a corresponding meaning.

“Board of Directors” means:

(1) with respect to a corporation, the Board of Directors of the corporation or any duly authorized committee of the Board of Directors;

(2) with respect to a partnership, the Board of Directors of the general partner of the partnership;

(3) with respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof or Board of Directors or any duly authorized committee of the Board of Directors, as the case may be; and

(4) with respect to any other Person, the board or committee of such Person serving a similar function.

“Business Day” means any day that is not a Saturday, a Sunday or other day on which commercial banks in New York, New York and the Federal Reserve Bank of New York are authorized or required by applicable law to remain closed.

 

7

“Capital Stock” of any Person means (a) in the case of a corporation, corporate stock; (b) in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock; (c) in the case of a partnership or limited liability company, partnership, membership interests (whether general or limited) or shares in the capital of a company; and (d) any other interest or participation that confers on a Person the right to receive a share of profits and losses of, or distribution of assets of, the issuing Person; provided that Capital Stock shall not include any debt securities that are convertible into or exchangeable for any combination of Capital Stock and/or cash.

“Capitalized Lease Obligations” means an obligation that is or would be required to be classified and accounted for as a capitalized lease for financial reporting purposes in accordance with GAAP. The amount of Indebtedness represented by such obligation will be the capitalized amount of such obligation on a balance sheet (excluding the footnotes thereto) at the time any determination thereof is to be made as determined in accordance with GAAP, and the Stated Maturity thereof will be the date of the last payment of rent or any other amount due under such lease prior to the first date such lease may be terminated without penalty. For the avoidance of doubt, any lease entered into after the Reference Date that would have been classified as an operating lease pursuant to GAAP will be deemed not to represent a Capitalized Lease Obligation, regardless of any change in generally accepted accounting principles in the United States following the Reference Date that would otherwise require such lease to be re-characterized (on a prospective or retroactive basis or otherwise).

“Cash Equivalents” means:

(1) United States dollars;

(2) Canadian dollars, Pounds Sterling, Yen, Euros, any national currency of any Participating Member State of the EMU, Swiss Franc and any other currency held in the ordinary course of business and not for speculative purposes;

(3) marketable direct obligations issued by, or unconditionally guaranteed by, the United States Government or issued by any agency thereof and backed by the full faith and credit of the United States, in each case maturing within two years from the date of acquisition;

(4) certificates of deposit, time deposits, eurodollar time deposits or overnight bank deposits having maturities of one year or less from the date of acquisition issued by any L/C Participant (as defined in the Letter of Credit Facility) or any domestic or foreign commercial bank having combined capital and surplus of not less than $500,000,000 in the case of U.S. banks and $100,000,000 (or the Dollar Equivalent as of the date of determination) in the case of non-U.S. banks;

(5) commercial paper of an issuer rated at least A-2 by S&P Global Ratings (“S&P”) or P-2 by Moody’s Investors Service, Inc. (“Moody’s”), or carrying an equivalent rating by a nationally recognized rating agency, if both of the two named rating agencies cease publishing ratings of commercial paper issuers generally, and maturing within twelve months from the date of acquisition;

(6) repurchase obligations for underlying securities of the types described in clauses (3), (4) and (9) of this definition entered into with any financial institution or recognized securities dealer meeting the qualifications specified in clause (4) above;

 

8

(7) securities with maturities of one year or less from the date of acquisition, which (or the unsecured unsubordinated debt securities of the issuer of which) is rated at least A- or A-2 by S&P or A3 or P-2 by Moody’s;

(8) securities with maturities of twelve months or less from the date of acquisition backed by standby letters of credit issued by any L/C Participant or any commercial bank satisfying the requirements of clause (4) of this definition;

(9) readily marketable direct obligations issued by any state, commonwealth or territory of the United States or any political subdivision or taxing authority thereof having an Investment Grade Rating from two of Moody’s, S&P and Fitch Ratings (or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from another rating agency) with maturities of 24 months or less from the date of acquisition;

(10) readily marketable direct obligations issued by any foreign government or any political subdivision or public instrumentality thereof, in each case having an Investment Grade Rating from two of Moody’s, S&P and Fitch Ratings (or, if at any time neither Moody’s nor S&P shall be rating such obligations, an equivalent rating from another rating agency) with maturities of 24 months or less from the date of acquisition;

(11) money market mutual or similar funds at least 90% of the assets of which consist of assets satisfying the requirements of clauses (1) through (10) of this definition; or

(12) money market funds that (i) comply with the criteria set forth in SEC Rule 2a-7 under the Investment Company Act of 1940, as amended, (ii) are rated AA- or better by S&P and Aa3 or better by Moody’s and (iii) have portfolio assets of at least $5,000,000,000.

“Cash Management Obligations” means obligations owed by the Company or any Guarantor to any lender or an Affiliate of a lender under a Debt Facility in respect of any services provided from time to time by any bank or other financial institution to the Company or any of its Subsidiaries in the ordinary course of business (whether or not consistent with past practice) in connection with operating, collections, payroll, trust or other depository or disbursement accounts, including automated clearinghouse, e-payable, electronic funds transfer, wire transfer, controlled disbursement, overdraft (so long as such overdraft is extinguished within 30 Business Days of Incurrence), depository, information reporting, lockbox, stop payment services, credit cards and p-cards (including commercial cards (including so-called “purchase cards,” “procurement cards” or “p-cards”)), credit card processing services, debit cards and stored value cards. For the avoidance of doubt, Cash Management Obligations do not include any obligations under Hedge Agreements.

“CFC” means a “controlled foreign corporation” within the meaning of Section 957(a) of the Code. Notwithstanding any provision to the contrary herein, in no event shall the Issuers, the Dutch Holdco or the Dutch Intermediate Holdco be a “CFC” for the purposes of this First Lien Indenture.

“CFC Holdco” means a direct or indirect Subsidiary substantially all of whose assets consist (directly or indirectly through entities that are disregarded for United States federal income Tax purposes) of the Equity Interests (including any other interest treated as an equity interest for U.S. federal income Tax purposes) and/or the Indebtedness of one or more CFCs and/or other CFC Holdcos. Notwithstanding any provision to the contrary herein, in no event shall (x) the Issuers, the Dutch Holdco or the Dutch Intermediate Holdco, (y) any other

 

9

Subsidiary by reason of its direct or indirect ownership of interests in the Dutch Holdco or the Dutch Intermediate Holdco, be a CFC Holdco or (z) any direct or indirect Subsidiary of the Dutch Holdco or the Dutch Intermediate Holdco as of the Issue Date (or any successor or assign of such Subsidiary) that is no longer a direct or indirect Subsidiary of the Dutch Holdco or the Dutch Intermediate Holdco, in each case, be a “CFC Holdco” for the purposes of this First Lien Indenture.

“Change of Control” means:

(1) any “person” or “group” of related persons (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that such person or group shall be deemed to have “beneficial ownership” of all shares that any such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of more than 50% of the total voting power of the Voting Stock of the Company or any of its direct or indirect parent companies (or their successors by merger, consolidation or purchase of all or substantially all of their assets);

(2) the merger or consolidation of the Company with or into another Person or the merger of another Person with or into the Company, unless the holders of a majority of the aggregate voting power of the Voting Stock of the Company, immediately prior to such transaction, hold securities of the surviving or transferee Person that represent, immediately after such transaction, at least a majority of the aggregate voting power of the Voting Stock of the surviving or transferee Person;

(3) the direct or indirect sale, assignment, conveyance, transfer, lease or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of all or substantially all of the assets of the Company or any parent company of the Company and its Restricted Subsidiaries taken as a whole to any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) other than to the Company, any of its Restricted Subsidiaries or one or more Permitted Holders;

(4) the adoption by the holders of the Capital Stock of the Company or any direct or indirect parent company of the Company of a plan or proposal for the liquidation or dissolution of the Company or any such parent company; or

(5) the Company ceases to be a Subsidiary of WeWork Inc. other than as a result of a consolidation or merger of WeWork Inc. with or into the Company or any other Guarantor that is a Domestic Subsidiary.

Notwithstanding the foregoing, a transaction shall not be deemed to involve a Change of Control if (i) the Company becomes a direct or indirect Wholly Owned Subsidiary of a holding company and (ii)(x) the direct or indirect holders of the Voting Stock of the ultimate parent company immediately following such transaction are substantially the same as the holders of the Company’s Voting Stock immediately prior to such transaction and (y) immediately following such transaction, no “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, is the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act) of more than 50% of the total voting power of the Voting Stock of the ultimate parent company. If any group includes one or more Permitted Holders, the issued and outstanding Voting Stock of the Company owned, directly or indirectly by any Permitted Holders that are part of such group shall not be treated as being beneficially owned by such group or any other member of such group for purposes of determining whether a Change of Control has occurred.

 

10

“ChinaCo” means WeWork Greater China Holding Company B.V., so long as it remains a Restricted Subsidiary of the Company.

“Co-Obligor” means the party named as such in the first paragraph of this First Lien Indenture.

“Code” means the U.S. Internal Revenue Code of 1986, as amended, and any successor statute.

“Collateral” means all property subject or purported to be subject, from time to time, to a Lien under any Security Document.

“Collateral Agent” means U.S. Bank Trust Company, National Association, in its capacity as Collateral Agent under this First Lien Indenture and under the Security Documents to which it is a party and any successor or replacement thereto in such capacity.

“Company” means the party named as such in the first paragraph of this First Lien Indenture or any successor obligor to its obligations under this First Lien Indenture and the First Lien Notes pursuant to Article 5.

“Consolidated Income Taxes” means, with respect to any Person for any period, taxes imposed upon such Person or any of its Restricted Subsidiaries, which taxes are calculated by reference to the income or profits or capital of such Person or any of its Restricted Subsidiaries (to the extent such income or profits were included in computing Consolidated Net Income for such period).

“Consolidated Interest Expense” means, with respect to any Person for any period, the total interest expense of such Person and its Restricted Subsidiaries (to the extent such expense was included in computing Consolidated Net Income for such period):

 

(1)

plus, without duplication to the extent not included in such interest expense:

 

(a)

the interest component of any deferred payment obligations;

 

(b)

amortization of debt discount and premium (including the amortization of original issue discount resulting from the issuance of Indebtedness at less than par); provided, however, that any amortization of bond premium will be credited to reduce Consolidated Interest Expense unless, pursuant to GAAP, such amortization of bond premium has otherwise reduced Consolidated Interest Expense;

 

(c)

non-cash interest expense, but any non-cash interest income or expense attributable to the movement in the mark-to-market valuation of Hedging Obligations or other derivative instruments pursuant to GAAP shall be excluded from the calculation of Consolidated Interest Expense;

 

11

(d)

the interest expense on Indebtedness of another Person that is Guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such Person or one of its Restricted Subsidiaries, in each case to the extent actually paid by such Person or one of its Restricted Subsidiaries;

 

(e)

interest expense of such Person and its Restricted Subsidiaries that was capitalized during such period; and

 

(f)

the product of (a) all dividends paid or payable, in cash, Cash Equivalents or Indebtedness or accrued during such period on any series of Disqualified Stock or on Preferred Stock of Non-Guarantor Subsidiaries (other than any non-cash Indebtedness paid or accrued on any Preferred Stock issued in reliance on Section 4.09(b)(16)) payable to a party other than the Company or a Wholly Owned Subsidiary, times (b) a fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state, provincial and local statutory tax rate of such Person, expressed as a decimal, in each case on a consolidated basis and in accordance with GAAP;

 

(2)

minus, without duplication and to the extent included in such interest expense:

 

(a)

the total interest income of such Person and its Restricted Subsidiaries (to the extent such income was included in computing Consolidated Net Income for such period); and

 

(b)

interest expense attributable to capitalized lease obligations (including Capitalized Lease Obligations) and the interest portion of rent expense associated with Attributable Indebtedness in respect of the relevant lease giving rise thereto;

provided that the Consolidated Interest Expense of ChinaCo and its Restricted Subsidiaries and the amounts described in clauses (1) and (2) above relating to ChinaCo and its Restricted Subsidiaries shall be excluded in computing Consolidated Interest Expense to the extent otherwise included in computing Consolidated Interest Expense.

For purposes of the foregoing, total interest expense will be determined (i) after giving effect to any net payments made or received by the Company and its Subsidiaries with respect to Specified Hedge Agreements and (ii) exclusive of amounts classified as other comprehensive income on the balance sheet of the Company.

“Consolidated Leverage Ratio” means, as of any date of determination so long as Adjusted EBITDA is positive, the ratio of (x) the Total Indebtedness of the Company and its Restricted Subsidiaries (other than the Total Indebtedness of ChinaCo and its Restricted Subsidiaries) as of the balance sheet date, to (y) Adjusted EBITDA of the Company and its Restricted Subsidiaries for the period of the most recent four consecutive fiscal quarters ending on the balance sheet date; provided, however, that:

 

(1)

if the Company or any Restricted Subsidiary:

 

12

(a)

has Incurred any Indebtedness (in each case in this clause (1)(a) or clause (1)(b), other than Indebtedness described in clause (5) of the definition thereof) since the balance sheet date that remains outstanding on such date of determination or if the transaction giving rise to the need to calculate the Consolidated Leverage Ratio is an Incurrence of Indebtedness, Indebtedness at the balance sheet date will be calculated after giving effect on a pro forma basis to such Indebtedness as if such Indebtedness had been Incurred on the balance sheet date and the discharge of any other Indebtedness repaid, repurchased, redeemed, retired, defeased or otherwise discharged with the proceeds of such new Indebtedness will be calculated as if such discharge had occurred on the balance sheet date; or

 

(b)

has repaid, repurchased, redeemed, retired, defeased or otherwise discharged any Indebtedness since the beginning of such period that is no longer outstanding on such date of determination or if the transaction giving rise to the need to calculate the Consolidated Leverage Ratio includes a discharge of Indebtedness (in each case, other than Indebtedness Incurred under any revolving Debt Facility unless such Indebtedness has been permanently repaid and the related commitment terminated and not replaced), Indebtedness as of the balance sheet date will be calculated after giving effect on a pro forma basis to such discharge of such Indebtedness, including with the proceeds of such new Indebtedness, as if such discharge had occurred on the balance sheet date;

(2) if since the beginning of such period the Company or any Restricted Subsidiary will have made any Asset Disposition or disposed of or discontinued any company, division, operating unit, segment, business, group of related assets or line of business constituting discontinued operations (as determined in accordance with GAAP) or if the transaction giving rise to the need to calculate the Consolidated Leverage Ratio includes such an Asset Disposition:

 

(a)

the Adjusted EBITDA for such period will be reduced by an amount equal to the Adjusted EBITDA (if positive) directly attributable to the assets that are the subject of such disposition or discontinuation for such period or increased by an amount equal to the Adjusted EBITDA (if negative) directly attributable thereto for such period; and

 

(b)

if such transaction occurred after the date of such internal financial statements, Indebtedness at the end of such period will be reduced by an amount equal to the Indebtedness repaid, repurchased, redeemed, retired, defeased or otherwise discharged with the Net Available Cash of such Asset Disposition and the assumption of Indebtedness by the transferee;

(3) if since the beginning of such period the Company or any Restricted Subsidiary (by merger or otherwise) will have made an Investment in any Restricted Subsidiary (or any Person that becomes a Restricted Subsidiary or is merged with or into the Company or a Restricted Subsidiary) or an acquisition of assets, including any acquisition of assets occurring in connection with a transaction causing a calculation to be made hereunder, which constitutes all or substantially all of a company, division, operating unit, segment, business or group of related assets or line of business, Adjusted EBITDA for such period and if such transaction occurred after the date of such internal financial statements, Indebtedness as of such balance sheet date will be calculated after giving pro forma effect thereto (including the Incurrence of any Indebtedness) as if such Investment or acquisition occurred on the first day of such period; and

 

13

(4) if since the beginning of such period any Person (that subsequently became a Restricted Subsidiary or was merged with or into the Company or any Restricted Subsidiary since the beginning of such period) will have Incurred any Indebtedness or discharged any Indebtedness or made any disposition or any Investment or acquisition of assets that would have required an adjustment pursuant to clause (1), (2) or (3) above if made by the Company or a Restricted Subsidiary during such period, Adjusted EBITDA for such period and, if such transaction occurred after the balance sheet date, Indebtedness as of the balance sheet date will be calculated after giving pro forma effect thereto as if such transaction occurred on the first day of such period or as of the balance sheet date, as applicable.

The pro forma calculations will be determined in good faith by a responsible financial or accounting Officer of the Company (including pro forma expense and cost reductions, regardless of whether such expense and costs reductions are calculated on a basis consistent with Regulation S-X under the Securities Act or any other regulation or order of the SEC related thereto). If any Indebtedness bears a floating rate of interest and is being given pro forma effect, the interest expense on such Indebtedness will be calculated as if the rate in effect on the date of determination had been the applicable rate for the entire period (taking into account any Specified Hedge Agreement applicable to such Indebtedness if such Specified Hedge Agreement has a remaining term in excess of 12 months). If any Indebtedness that is being given pro forma effect bears an interest rate at the option of the Company, the interest rate shall be calculated by applying such optional rate chosen by the Company. In making any pro forma calculation, the amount of Indebtedness under any revolving Debt Facility outstanding on the date of determination (other than any Indebtedness Incurred under such facility in connection with the transaction giving rise to the need to calculate the Consolidated Leverage Ratio) will be deemed to be:

(1) the average daily balance of such Indebtedness during such four fiscal quarters or such shorter period for which such facility was outstanding or

(2) if such facility was created after the end of such four fiscal quarters, the average daily balance of such Indebtedness during the period from the date of creation of such facility to the date of such calculation.

“Consolidated Net Income” means, for any period, the net income (loss) of the Company and its consolidated Restricted Subsidiaries determined on a consolidated basis in accordance with GAAP; provided, however, that there shall not be included in such Consolidated Net Income on an after-tax basis:

(1) any net income (loss) of any Person if such Person is not a Restricted Subsidiary or that is accounted for by the equity method of accounting, except that:

 

(a)

the Company’s equity in the net income of any such Person for such period will be included in such Consolidated Net Income up to the aggregate amount of cash actually distributed by such Person during such period to the Company or a Restricted Subsidiary as a dividend or other distribution (subject, in the case of a dividend or other distribution to a Restricted Subsidiary, to the limitations contained in clause (2) below); and

 

(b)

the Company’s equity in a net loss of any such Person (other than an Unrestricted Subsidiary) for such period will be included in determining such Consolidated Net Income to the extent such loss has been funded with cash from the Company or a Restricted Subsidiary; and

 

14

(2) any net income (but not loss) of any Restricted Subsidiary (other than a Guarantor) if such Restricted Subsidiary is subject to prior government approval (that has not been obtained or cannot be obtained other than pursuant to customary filings) or other restrictions due to the operation of its charter or any agreement, instrument, judgment, decree, order statute, rule or government regulation (which have not been waived), directly or indirectly, on the payment of dividends or the making of distributions by such Restricted Subsidiary, directly or indirectly, to the Company, except that:

 

(a)

the Company’s equity in the net income of any such Restricted Subsidiary for such period will be included in such Consolidated Net Income up to the aggregate amount of cash that could have been distributed by such Restricted Subsidiary during such period to the Company or another Restricted Subsidiary as a dividend (subject, in the case of a dividend to another Restricted Subsidiary, to the limitation contained in this clause); and

 

(b)

the Company’s equity in a net loss of any such Restricted Subsidiary for such period will be included in determining such Consolidated Net Income.

“Consolidated Total Assets” means, as of any date of determination, the total amount of assets of the Company and its Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP, as shown on the most recent balance sheet of the Company or such other Person prepared on a consolidated basis in accordance with GAAP that is available. For the avoidance of doubt, with respect to any operating lease in existence on the Reference Date and any lease entered into after the Reference Date that would have been classified as an operating lease pursuant to GAAP, no related right-of-use asset or other related asset recorded on the consolidated balance sheet of the Company shall be included in Consolidated Total Assets.

“Controlling Authorized Representative” means, with respect to any Shared Collateral, (i) prior to the occurrence of the earlier of (x) a Letter of Credit Facility Discharge Event and (y) the Non-Controlling Authorized Representative Enforcement Date, the Senior Tranche Administrative Agent or the Junior Tranche Administrative Agent (to the extent the Junior Tranche Administrative Agent is the controlling agent under the Letter of Credit Facility), and (ii) thereafter, the Collateral Agent.

“Controlling Parity Lien Collateral Agent” means, for purposes of the First Lien/Second Lien/Third Lien Intercreditor Agreement, (i) if there is only one Parity Lien Collateral Agent party to the First Lien/Second Lien/Third Lien Intercreditor Agreement at such time, such Parity Lien Collateral Agent and (ii) if clause (i) does not apply, the Parity Lien Collateral Agent which is the “Controlling Authorized Representative” under the Pari Passu Intercreditor Agreement at such time.

“Controlling Secured Parties” means, with respect to any Collateral, the Series of Parity Lien Secured Parties whose Authorized Representative is the Controlling Authorized Representative for such Collateral.

 

15

“Corporate Trust Office of the Trustee” shall be at the address of the Trustee specified in Section 13.01 or such other address as to which the Trustee may give notice to the Holders and the Company.

“Credit Agreement” means the Credit Agreement, dated as of December 27, 2019 (as amended by the First Amendment dated as of February 10, 2020, the Second Amendment dated as of April 1, 2020, the Third Amendment dated as of December 6, 2021, the Fourth Amendment dated as of May 10, 2022, the Fifth Amendment dated as of December 20, 2022, the Sixth Amendment dated as of February 15, 2023 and as may be further amended, modified, restated and supplemented from time to time), among the SoftBank Obligor, the WeWork Obligor (each as defined therein), the several banks and other financial institutions or entities from time to time parties thereto.

“Credit Documents” means the Credit Agreement, the Fee Letters, the WeWork Subsidiary Guaranty, the SVF Security Documents and the WeWork Security Documents (each as defined in the Credit Agreement).

“Custodian” means the Trustee, as custodian with respect to the First Lien Notes in global form, or any successor entity thereto.

“Date of Full Discharge” has the meaning set forth in Section 12.07.

“Debt Facility” means one or more debt facilities (including, without limitation, the Letter of Credit Facility), credit facilities, commercial paper facilities, indentures and other agreements with banks, institutional lenders, purchasers, investors, trustees or agents providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables), or letters of credit, alternative letters of credit, surety or performance bonds or issuances of debt securities evidenced by notes, debentures, bonds or similar instruments, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time (and without limitation as to terms, conditions, covenants and other provisions and whether or not with the original administrative agent, banks, institutional lenders, purchasers, investors, trustees or agents).

“Default” means any event that is, or after notice or passage of time or both would be, an Event of Default.

“Definitive Note” means a certificated Initial Note or PIK Note (bearing the Restricted Notes Legend if the transfer of such First Lien Note is restricted by applicable law) that does not include the Global Notes Legend.

“Depositary” means, with respect to the First Lien Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.03 as the Depositary with respect to the First Lien Notes, and any and all successors thereto appointed as Depositary hereunder and having become such pursuant to the applicable provision of this First Lien Indenture.

“Derivative Instrument” with respect to a Person, means any contract, instrument or other right to receive payment or delivery of cash or other assets to which such Person or any Affiliate of such Person that is acting in concert with such Person in connection with such Person’s investment in the First Lien Notes (other than a Screened Affiliate) is a party (whether or not requiring further performance by such Person), the value and/or cash flows of which (or any material portion thereof) are materially affected by the value and/or performance of the First Lien Notes and/or the creditworthiness of the Company and/or any one or more of the Guarantors (the “Performance References”).

 

16

“Designated Non-cash Consideration” means non-cash consideration received by the Company or one of its Restricted Subsidiaries in connection with an Asset Disposition that is designated by the Company as Designated Non-cash Consideration pursuant to an Officer’s Certificate setting forth the basis of such valuation, less the amount of cash received in connection with a subsequent sale, redemption or payment of, on or with respect to such Designated Non-cash Consideration, which cash shall be considered Net Available Cash received as of such date and shall be applied pursuant to Section 4.16.

“Discharge” means, with respect to any Collateral and any Series of Parity Lien Obligations, the date on which such Series of Parity Lien Obligations has been paid and satisfied in full in cash and is no longer secured by and no longer required to be secured by such Collateral; it being understood that a “Discharge” shall not have occurred solely by virtue of a party having subrogated to the rights of the Parity Lien Collateral Agent and/or the Letter of Credit Secured Parties, in each case, under the Letter of Credit Facility.

“Discharge of Letter of Credit Facility Obligations” means the Discharge of the Letter of Credit Facility Obligations with respect to Collateral; provided, that the Discharge of Letter of Credit Facility Obligations shall not be deemed to have occurred (i) in connection with a Refinancing of such Letter of Credit Facility Obligations with additional Parity Lien Obligations secured by such Collateral under a Secured Debt Document which has been designated in writing by the Parity Lien Collateral Agent (under the Letter of Credit Facility so refinanced), (ii) to the extent the Date of Full Satisfaction has occurred (x) in respect of the Senior L/C Tranche (as defined in the Letter of Credit Facility), but not in respect of the Junior L/C Tranche (as defined in the Letter of Credit Facility), or (y) in respect of the Junior L/C Tranche (as defined in the Letter of Credit Facility ), but not in respect of the Senior L/C Tranche (as defined in the Letter of Credit Facility), or (iii) to the extent a party has subrogated to the rights of the Parity Lien Collateral Agent and/or the Parity Lien Secured Parties, in each case, under the Letter of Credit Facility unless such subrogee’s obligations shall also have been Discharged.

“Discharge of Parity Lien Obligations” means the occurrence of all of the following:

(1) payment in full in cash of the principal of and interest (including all interest accrued thereon after the commencement of any Insolvency or Liquidation Proceeding) and premium (if any) on all Parity Lien Debt; and

(2) payment in full in cash of all other Parity Lien Obligations that are outstanding and unpaid at the time the Parity Lien Debt is paid in full in cash (other than any obligations for taxes, costs, indemnifications, reimbursements, damages and other liabilities in respect of which no claim or demand for payment has been made at or prior to such time);

provided that, if at any time after the Discharge of Parity Lien Obligations has occurred, the Company or any Guarantor enters into any Parity Lien Document evidencing a Parity Lien Obligation the Incurrence of which is not prohibited by the applicable Secured Debt Documents, then such Discharge of Parity Lien Obligations shall automatically be deemed not to have occurred for all purposes of the First Lien/Second Lien/Third Lien Intercreditor Agreement with respect to such new Parity Lien Obligations (other than with respect to any actions taken as a result of the occurrence of such first Discharge of Parity Lien Obligations), and, from and after

 

17

the date on which the Company designates such Indebtedness as Parity Lien Debt in accordance with the First Lien/Second Lien/Third Lien Intercreditor Agreement, the obligations under such Parity Lien Document shall automatically and without any further action be treated as Parity Lien Obligations for all purposes of the First Lien/Second Lien/Third Lien Intercreditor Agreement, including for purposes of the Lien priorities and rights in respect of Collateral set forth in the First Lien/Second Lien/Third Lien Intercreditor Agreement and any Junior Lien Obligations shall be deemed to have been at all times Junior Lien Obligations and at no time Parity Lien Obligations.

For the avoidance of doubt, (x) a refinancing of Parity Lien Obligations with other Parity Lien Obligations to the extent contemplated and permitted by the First Lien/Second Lien/Third Lien Intercreditor Agreement shall not be deemed to cause a Discharge of Parity Lien Obligations and (y) a Discharge of Parity Lien Obligations shall not be deemed to have occurred to the extent a party (including, without limitation, the SVF Obligor) has subrogated to the rights of the Parity Lien Collateral Agent and/or the Parity Lien Secured Parties, in each case, under the Letter of Credit Facility unless such subrogee’s obligations shall also have been Discharged.

“Disqualified Stock” means, with respect to any Person, any Capital Stock of such Person that by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable) or upon the happening of any event or condition:

(1) matures or is mandatorily redeemable pursuant to a sinking fund obligation or otherwise;

(2) is convertible into or exchangeable for Indebtedness or Disqualified Stock (excluding Capital Stock which is convertible or exchangeable solely at the option of the Company or a Restricted Subsidiary (it being understood that upon such conversion or exchange it shall be an Incurrence of such Indebtedness or Disqualified Stock)); or

(3) is redeemable at the option of the holder of the Capital Stock in whole or in part,

in each case on or prior to the date 91 days after the earlier of the final maturity date of the First Lien Notes or the date the First Lien Notes are no longer outstanding; provided, however, that only the portion of Capital Stock which so matures or is mandatorily redeemable, is so convertible or exchangeable or is so redeemable at the option of the holder thereof prior to such date will be deemed to be Disqualified Stock; provided, further, that any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require the Company or its Restricted Subsidiaries to repurchase such Capital Stock upon the occurrence of a Change of Control or Asset Disposition (each defined in a substantially similar manner to the corresponding definitions in this First Lien Indenture, as determined by the Company in good faith) shall not constitute Disqualified Stock if the terms of such Capital Stock (and all such securities into which it is convertible or exchangeable or for which it is redeemable) provide that the Company or its Restricted Subsidiaries, as applicable, are not required to repurchase or redeem any such Capital Stock (and all such securities into which it is convertible or exchangeable or for which it is redeemable) pursuant to such provision prior to compliance by the Company with the provisions of Section 4.15 and Section 4.16 and such repurchase or redemption does not violate Section 4.08.

“Domestic Subsidiary” means any Restricted Subsidiary that is organized or existing under the laws of the United States, any state thereof or the District of Columbia.

“DTC” means The Depository Trust Company.

 

18

“Dutch Holdco” means WW Worldwide C.V., a Dutch limited partnership.

“Dutch Intermediate Holdco” means WeWork Companies (International) B.V., a Dutch private company.

“Enforcement Action” means, with respect to any Series of Parity Lien Debt or Series of Junior Lien Debt, as applicable, (a) the taking of any action to enforce any Lien in respect of the Collateral, including the institution of any foreclosure proceedings, the noticing of any public or private sale or other disposition under the Bankruptcy Code or any attempt to vacate or obtain relief from a stay or other injunction restricting any other action described in this definition, (b) the exercise of any right or remedy provided to a secured creditor on account of a Lien under the Parity Lien Documents, or Junior Lien Documents, as applicable (including, in each case, any delivery of any notice to seek to obtain payment directly from any account debtor of the Company or any Guarantor or the taking of any action or the exercise of any right or remedy in respect of the setoff or recoupment against, collection or foreclosure on or marshalling of the Collateral or proceeds of Collateral), under applicable law, at equity, in an Insolvency or Liquidation Proceeding or otherwise, including the acceptance of Collateral in full or partial satisfaction of a Lien, (c) the sale, assignment, transfer, lease, license, or other disposition as a secured creditor on account of a Lien of all or any portion of the Collateral, by private or public sale (judicial or non-judicial) or any other means, (d) the solicitation of bids from third parties to conduct the liquidation of all or a portion of Collateral as a secured creditor on account of a Lien, (e) the exercise of any other enforcement right relating to the Collateral (including the exercise of any voting rights relating to any Capital Stock comprising a portion of the Collateral) whether under the Parity Lien Documents, or Junior Lien Documents, as applicable, under applicable law of any jurisdiction, in equity, in an Insolvency or Liquidation Proceeding, or otherwise, or (f) the appointment of a receiver, manager or interim receiver of all or any portion of the Collateral or the commencement of, or the joinder with any creditor in commencing, any Insolvency or Liquidation Proceeding against the Company or any Guarantor or any assets of the Company or any Guarantor.

“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, any combination of Capital Stock and/or cash).

“Equity Offering” means a public or private offering for cash by the Company or any direct or indirect parent company of the Company, as applicable, of its Equity Interests, other than (1) public offerings with respect to the Company’s or any such direct or indirect parent’s, as applicable, Capital Stock, or options, warrants or rights, registered on Form S-4 or Form S-8, (2) an issuance to any Subsidiary or (3) any offering of Capital Stock issued in connection with a transaction that constitutes a Change of Control.

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder.

“Excluded Equity Interest” means (a) margin stock, (b) Equity Interests of any Person other than any Subsidiary that is a Restricted Subsidiary directly owned by the Company or any Guarantor, (c) Equity Interests in joint ventures and Restricted Subsidiaries that are not wholly owned by the Company and its Restricted Subsidiaries to the extent a pledge of such Equity Interests would be prohibited by the applicable joint venture agreement or organizational documents of such joint venture or such non-wholly-owned Restricted Subsidiary, (d) Equity Interests (which shall include, for purposes of this clause (d), any other interest treated as an

 

19

equity interest for U.S. federal income Tax purposes) of any CFC or CFC Holdco in excess of 65% of the “total combined voting power of all classes of voting stock” (within the meaning of Treasury Regulations section 1.956-2(c)(2)) of such CFC or CFC Holdco, as the case may be, (e) any Equity Interest to the extent the pledge thereof would be prohibited by any law (excluding any prohibition or restriction that is ineffective under the Uniform Commercial Code), (f) any Equity Interests with respect to which the Company and the Collateral Agent (or the Pari Passu Collateral Agent) have reasonably determined that the cost or other consequences (including material adverse Tax consequences to the Company or any of its Subsidiaries or direct or indirect beneficial owners) of pledging or perfecting a security interest in such Equity Interests are excessive in relation to the benefit to the Secured Parties of the security to be afforded thereby and (g) the Equity Interests of any special purpose entities (or similar entities other than any ordinary course lease holding entities), any Captive Insurance Subsidiary (as such term is defined in the Letter of Credit Facility as in effect on the date hereof), any not-for-profit Subsidiary, any Immaterial Subsidiary (as such term is defined in the Letter of Credit Facility as in effect on the date hereof) and any properly designated Unrestricted Subsidiary. Notwithstanding any provision to the contrary herein, in no event shall the Equity Interests of the Issuers, the Dutch Holdco or the Dutch Intermediate Holdco be “Excluded Equity Interests.”

“Existing Unsecured Notes” means the Company’s (i) 7.875% Senior Notes due 2025 and (ii) 5.000% Senior Notes due 2025, Series II, in each case to the extent outstanding following the consummation of the Transactions.

“Expense Reimbursement Agreement” means that certain Expense Reimbursement Agreement, dated as of May 5, 2023 by and among the Company, the Co-Obligor, the guarantors party thereto and the Noteholder Parties (as defined therein).

“Fair Market Value” means, with respect to any asset or liability, the fair market value of such asset or liability as determined by any Officer of the Company in good faith; provided that, except as otherwise provided in this First Lien Indenture, if the fair market value exceeds $25.00 million, such determination shall be made by the Board of Directors of the Company or an authorized committee thereof, or the Board of Directors or authorized committee of the applicable Restricted Subsidiary, in good faith.

“First Lien Indenture” means this First Lien Senior Secured PIK Notes Indenture, as amended, supplemented, restated or otherwise modified from time to time.

“First Lien Notes” means the Initial Notes and any First Lien Note authenticated and delivered under this First Lien Indenture, including any Series of First Lien Notes. For all purposes of this First Lien Indenture, the term “First Lien Notes” shall also include any PIK Notes that may be issued under this First Lien Indenture and First Lien Notes to be issued or authenticated upon transfer, replacement or exchange of First Lien Notes.

“First Lien NPA” means that certain Master First Lien Senior Secured PIK Notes Note Purchase Agreement, dated as of May 5, 2023 (as amended or otherwise modified from time to time), by and among the Company, Co-Obligor and SoftBank Vision Fund II-2 L.P., a limited partnership established in Jersey (the “Series II Purchaser”), acting by its manager, SB Global Advisers Limited, a limited company incorporated under the laws of England and Wales.

“First Lien/Second Lien/Third Lien Intercreditor Agreement” means the Intercreditor Agreement among the Collateral Agent, the Trustee, the Second Priority Lien Collateral Agent, the Third Priority Lien Collateral Agent, the Senior Tranche Administrative Agent, the Company, the Guarantors and the other parties from time to time party thereto, to be entered into on the Issue Date, as it may be amended, restated, supplemented or otherwise modified from time to time.

 

20

“Fitch” means Fitch Ratings, Inc. or any successor to its rating agency business.

“Foreign Subsidiary” means any Restricted Subsidiary that is not organized under the laws of the United States or any state thereof or the District of Columbia.

“GAAP” means generally accepted accounting principles in the United States as in effect as of the Reference Date, including those set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as approved by a significant segment of the accounting profession. Unless otherwise specified, all ratios and computations, contained in this First Lien Indenture will be computed in conformity with GAAP, except that in the event the Company is acquired in a transaction that is accounted for using purchase accounting, the effects of the application of purchase accounting shall be disregarded in the calculation of such ratios and other computations contained in this First Lien Indenture.

“Government Authority” means any government department, ministry, cabinet, commission, board, bureau, agency, tribunal, regulatory authority, instrumentality, judicial legislative or administrative body or entity, domestic or foreign, regional, provincial or local, having or exercising jurisdiction over the matter or matters in question.

“Government Securities” means securities that are (1) direct obligations of the United States for the timely payment of which its full faith and credit is pledged or (2) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States the timely payment of which is unconditionally Guaranteed as a full faith and credit obligation of the United States, which, in either case, are not callable or redeemable at the option of the issuer thereof, and shall also include a depositary receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such Government Securities or a specific payment of principal of or interest on any such Government Securities held by such custodian for the account of the holder of such depositary receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depositary receipt from any amount received by the custodian in respect of the Government Securities or the specific payment of principal of or interest on the Government Securities evidenced by such depositary receipt.

“Grantor” means the Company and any Guarantor that shall have granted any Lien in favor of the Collateral Agent on any of its assets or properties to secure any Obligations under the Secured Indebtedness.

“Guarantee” means (1) any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any other Person and (2) any obligation, direct or indirect, contingent or otherwise, of such Person:

(a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by agreement to keep-well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement conditions or otherwise); or

 

21

(b) entered into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); provided, however, that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.

“Guarantor” means (i) the Parent Guarantor and (ii) each Restricted Subsidiary in existence on the Issue Date that provides a Note Guarantee on the Issue Date (and any other Restricted Subsidiary that provides a Note Guarantee after the Issue Date); provided that upon release or discharge of the Parent Guarantor or such Restricted Subsidiary from its Note Guarantee in accordance with this First Lien Indenture, the Parent Guarantor or such Restricted Subsidiary ceases to be a Guarantor.

“Guarantor Subordinated Obligation” means, with respect to a Guarantor, any Indebtedness of such Guarantor (whether outstanding on the Issue Date or thereafter Incurred) that is expressly subordinated pursuant to its terms in right of payment to the obligations of such Guarantor under its Note Guarantee.

“Hedge Agreement” means any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; provided that no phantom stock or similar plan providing for payments only on account of services provided by current or former directors, officers, employees or consultants of the Company or any of its Subsidiaries shall be a “Hedge Agreement.”

“Hedging Obligations” of any Person means the obligations of such Person pursuant to any Hedge Agreement.

“Holder” means a Person in whose name a First Lien Note is registered on the Registrar’s books.

“Incur” means issue, create, assume, Guarantee, incur or otherwise become liable for; provided, however, that any Indebtedness or Capital Stock of a Person existing at the time such Person becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition or otherwise) will be deemed to be Incurred by such Restricted Subsidiary at the time it becomes a Restricted Subsidiary; and the terms “Incurred” and “Incurrence” have meanings correlative to the foregoing.

“Indebtedness” means, with respect to any Person on any date of determination (without duplication):

(1) the principal of and premium (if any) in respect of indebtedness of such Person for borrowed money;

(2) the principal of and premium (if any) in respect of obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;

(3) the principal component of all obligations of such Person in respect of letters of credit, surety or performance bonds, bank guarantees, bankers’ acceptances or other similar instruments (including reimbursement obligations with respect thereto except to the extent such reimbursement obligation relates to a trade payable and such obligation is satisfied within 60 days of Incurrence);

 

22

(4) the principal component of all obligations of such Person to pay the deferred and unpaid purchase price of property, which purchase price is due after the date of placing such property in service or taking delivery and title thereto, except (a) any such balance that constitutes a trade payable or similar obligation to a trade creditor, in each case accrued in the ordinary course of business (whether or not consistent with past practice), and (b) any earn-out obligation until the amount of such obligation becomes a liability on the balance sheet of such Person in accordance with GAAP;

(5) Capitalized Lease Obligations and all Attributable Indebtedness of such Person (whether or not such Attributable Indebtedness would appear on the balance sheet of such Person in accordance with GAAP); and

(6) the greater of the maximum mandatory redemption or repurchase price (not including, in either case, any redemption or repurchase premium) or the principal component or liquidation preference of all obligations of such Person with respect to the redemption, repayment or other repurchase of any Disqualified Stock or, with respect to any Non-Guarantor Subsidiary, any Preferred Stock (but excluding, in each case, any accrued dividends),

if and to the extent that any of the preceding items in clauses (1) through (6) (other than letters of credit, surety or performance bonds, bank guarantees, bankers’ acceptances or other similar instruments, Attributable Indebtedness and Hedging Obligations) would appear as a liability upon a balance sheet of the specified Person prepared in accordance with GAAP;

(7) the principal component of all Indebtedness of other Persons secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; provided, however, that the amount of such Indebtedness will be the lesser of (a) the Fair Market Value of such asset at such date of determination and (b) the amount of such Indebtedness of such other Persons;

(8) the principal component of Indebtedness of other Persons to the extent Guaranteed by such Person (whether or not such items would appear on the balance sheet of such Person in accordance with GAAP);

(9) to the extent not otherwise included in this definition, net obligations of such Person under Hedging Obligations (the amount of any such obligations to be equal at any time to the termination value of such agreement or arrangement giving rise to such Obligation that would be payable by such Person at such time); and

(10) to the extent not otherwise included in this definition, the amount of obligations outstanding under the legal documents entered into as part of a securitization transaction or series of securitization transactions that would be characterized as principal if such transaction were structured as a secured lending transaction rather than as a purchase relating to a securitization transaction or series of securitization transactions.

For the avoidance of doubt, any operating lease in existence on the Reference Date and any lease entered into after the Reference Date that would have been classified as an operating lease pursuant to GAAP, any termination payment, fee or other expenses (including, but not limited to, as part of termination agreements, settlement agreements or lease amendments) and any Guarantee of any of the foregoing, shall not be deemed to be “Indebtedness.”

 

23

Notwithstanding the foregoing, money borrowed and set aside at the time of the Incurrence of any Indebtedness in order to pre-fund the payment of interest on such Indebtedness shall not be deemed to be “Indebtedness”; provided that such money is held to secure the payment of such interest.

The amount of any Indebtedness outstanding as of any date shall (i) be the accreted value thereof in the case of any Indebtedness issued with original issue discount or the aggregate principal amount outstanding in the case of Indebtedness issued with interest payable in kind and (ii) include any interest (or in the case of Preferred Stock, dividends) thereon that is more than 30 days past due. Except to the extent provided in the preceding sentence, the amount of any Indebtedness that is convertible into or exchangeable for Capital Stock of the Company outstanding as of any date shall be deemed to be equal to the principal and premium, if any, in respect of such Indebtedness, notwithstanding the provisions of GAAP (including Accounting Standards Codification Topic 470-20, Debt-Debt with Conversion and Other Options).

“Initial Notes” means the Initial Series I Notes, the Initial Series II Notes and/or the Initial Series III Notes, as applicable.

“Initial Series I Notes” has the meaning set forth in the recitals hereto.

“Initial Series II Notes” has the meaning set forth in the recitals hereto.

“Initial Series III Notes” has the meaning set forth in the recitals hereto.

“Intercreditor Agreements” means, collectively, the Pari Passu Intercreditor Agreement and the First Lien/Second Lien/Third Lien Intercreditor Agreement.

“Interest Payment Date” means April 1 and October 1 of each year to the Stated Maturity of the First Lien Notes.

“Investment” means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the form of loans (including by way of Guarantee), capital contributions or advances (other than accounts receivable, trade credit, advances to customers, commission, travel, moving and similar advances in the ordinary course of business (whether or not consistent with past practice)), purchases or other acquisitions for consideration of Equity Interests, Indebtedness or other similar instruments issued by such Person and all other items that are or would be classified as investments on a balance sheet (excluding the footnotes thereto) of the Company prepared in accordance with GAAP and in the same manner as the other investments included in this definition to the extent such transactions involve the transfer of cash or property; provided that none of the following will be deemed to be an Investment:

(1) Hedging Obligations entered into in the ordinary course of business (whether or not consistent with past practice) and in compliance with this First Lien Indenture;

(2) endorsements of negotiable instruments and documents in the ordinary course of business (whether or not consistent with past practice); and

 

24

(3) an acquisition of assets, Capital Stock or other securities by the Company or a Subsidiary for consideration to the extent such consideration consists of Capital Stock of the Company.

For purposes of Section 4.08 and Section 4.13:

(1) “Investment” shall include the portion (proportionate to the Company’s equity interest in a Restricted Subsidiary that is to be designated an Unrestricted Subsidiary) of the Fair Market Value of the net assets of such Restricted Subsidiary at the time that such Restricted Subsidiary is designated an Unrestricted Subsidiary; provided, however, that upon a redesignation of such Subsidiary as a Restricted Subsidiary, the Company will be deemed to continue to have a permanent “Investment” in an Unrestricted Subsidiary in an amount (if positive) equal to (a) the Company’s aggregate “Investment” in such Subsidiary as of the time of such redesignation less (b) the portion (proportionate to the Company’s equity interest in such Subsidiary) of the Fair Market Value of the net assets of such Subsidiary at the time that such Subsidiary is so redesignated a Restricted Subsidiary;

(2) any property transferred to or from an Unrestricted Subsidiary will be valued at its Fair Market Value at the time of such transfer; and

(3) if the Company or any Restricted Subsidiary sells or otherwise disposes of any Voting Stock of any Restricted Subsidiary such that, after giving effect to any such sale or disposition, such entity is no longer a Subsidiary of the Company, the Company shall be deemed to have made an Investment on the date of any such sale or disposition equal to the Fair Market Value of the Capital Stock of such Subsidiary not sold or disposed of.

The amount of any Investment outstanding at any time shall be the original cost of such Investment, reduced by any dividend, distribution, interest payment, return of capital, repayment or other amount received in cash or Cash Equivalents by the Company or any Restricted Subsidiary in respect of such Investment.

“Insolvency or Liquidation Proceeding” means:

(1) any case or proceeding commenced by or against the Company or any Guarantor under the Bankruptcy Code or any other Bankruptcy Law, any other proceeding for the reorganization, recapitalization or adjustment or marshalling of the assets or liabilities of the Company or any Guarantor, any receivership or assignment for the benefit of creditors relating to the Company or any Guarantor or any similar case or proceeding relative to the Company or any Guarantor or its creditors, as such, in each case whether or not voluntary;

(2) any liquidation, dissolution, marshalling of assets or liabilities or other winding up of or relating to the Company or any Guarantor, in each case whether or not voluntary and whether or not involving bankruptcy or insolvency; or

(3) any other proceeding of any type or nature in which substantially all claims of creditors of the Company or any Guarantor are determined and any payment or distribution is or may be made on account of such claims.

 

25

“Investor” means (a) Adam Neumann, Miguel McKelvey, Benchmark Capital Partners VII (AIV), L.P., DAG Holdings, We Holdings LLC (so long as the majority of the equity interests of We Holdings LLC are beneficially owned by persons who are otherwise Investors), JP Morgan Holdings and SBG, (b) any Affiliate of any such Person, (c) any trust or partnership created solely for the benefit of any natural person listed in clause (a) and/or members of the family of any natural person listed in clause (a), and (d) any Person where the voting of shares of Capital Stock of the Company is controlled by any of the foregoing.

“Issue Date” means the first date the Series I First Lien Notes are issued.

“Junior Lien” means a Lien, junior to the Parity Liens as provided in the First Lien/Second Lien/Third Lien Intercreditor Agreement and any Junior Intercreditor Agreement, granted by the Company or any Guarantor in favor of holders of Junior Lien Debt (or any collateral trustee or representative in connection therewith), at any time, upon any property of the Company or any Guarantor to secure Junior Lien Obligations.

“Junior Lien Collateral Agent” means the collateral agent or other representative of lenders or holders of Junior Lien Obligations designated pursuant to the terms of any Junior Lien Documents and the Junior Intercreditor Agreement.

“Junior Lien Debt” means any Indebtedness (other than intercompany Indebtedness owing to the Company or its Subsidiaries) of the Company or any Guarantor (including any Permitted Refinancing Indebtedness in respect thereof to the extent permitted by the First Lien/Second Lien/Third Lien Intercreditor Agreement) that is (i) secured by a Junior Lien, (ii) permitted to be Incurred under Section 4.09 and Section 4.10, (iii) permitted to be Incurred and so secured under each applicable Secured Debt Document, (iv) has a final maturity equal to or later than, and a weighted Average Life to Stated Maturity equal to or greater than, 91 days after the final maturity of the First Lien Notes and (v) is subject to any Junior Intercreditor Agreement and the First Lien/Second Lien/Third Lien Intercreditor Agreement; provided that, in the case of any Indebtedness referred to in this definition:

(1) on or before the date on which such Indebtedness is Incurred by the Company or any Guarantor, such Indebtedness is designated by the Company, in an officers’ certificate delivered to the Junior Lien Collateral Agent and Collateral Agent as “Junior Lien Debt” for the purposes of the Secured Debt Documents; provided that no Series of Secured Debt may be designated as both “Junior Lien Debt” and “Parity Lien Debt” (or any combination of the two);

(2) the collateral agent or other representative with respect to such Indebtedness, Collateral Agent, the Junior Lien Collateral Agent, the Company and each applicable Guarantor have duly executed and delivered any Intercreditor Agreement (or a joinder to the First Lien/Second Lien/Third Lien Intercreditor Agreement or a new Intercreditor Agreement substantially similar to the First Lien/Second Lien/Third Lien Intercreditor Agreement, and in a form reasonably acceptable to each of the parties thereto);

(3) the collateral agent or other representative with respect to such Indebtedness, the Junior Lien Collateral Agent, the Collateral Agent, the Company and each applicable Guarantor have duly executed and delivered any Junior Intercreditor Agreement (or a joinder to the Junior Intercreditor Agreement or a new Junior Intercreditor Agreement substantially similar to the Junior Intercreditor Agreement, and in a form reasonably acceptable to each of the parties thereto); and

(4) all other requirements set forth in the First Lien/Second Lien/Third Lien Intercreditor Agreement and any Junior Intercreditor Agreement as to the confirmation, grant or perfection of the Liens of the holders of Junior Lien Debt to secure such Indebtedness or Obligations in respect thereof are satisfied.

 

26

“Junior Lien Documents” means, collectively, any indenture, Debt Facility or other agreement or instrument pursuant to which Junior Lien Debt is Incurred and the documents pursuant to which Junior Lien Obligations are granted.

“Junior Lien Obligations” means Junior Lien Debt and all other Obligations in respect thereof.

“Junior Lien Representative” means in the case of any Series of Junior Lien Debt, the trustee, agent or representative of the holders of such Series of Junior Lien Debt who maintains the transfer register for such Series of Junior Lien Debt and is appointed as a representative of such Series of Junior Lien Debt (for purposes related to the administration of the security documents) pursuant to this First Lien Indenture, Letter of Credit Facility or other agreement governing such Series of Junior Lien Debt.

“LC Facility” means one or more Debt Facilities (including, without limitation, the Letter of Credit Facility) under which letters of credit, surety or performance bonds, bankers’ acceptances or similar instruments may be issued for the benefit of the Company and any Restricted Subsidiary, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time (and without limitation as to terms, conditions, covenants and other provisions and whether or not with the original administrative agent, banks, institutional lenders, purchasers, investors, trustees or agents).

“Letter of Credit Facility” means the letter of credit facility established under the Credit Agreement, dated as of December 27, 2019, by and among the Company and SoftBank Vision Fund II-2 L.P. (as successor co-obligor to SoftBank Group Corp.), as co-obligors, the issuing creditors and L/C Participants party thereto and Goldman Sachs International Bank, as senior tranche administrative agent and shared collateral agent and Kroll Agency Services Limited, as junior tranche administrative agent, as amended from time to time, and as such agreement may be further amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time in accordance with the terms of the Pari Passu Intercreditor Agreement (including increasing the amount of the commitments thereunder; provided that such additional Indebtedness is Incurred in accordance with Section 4.09).

“Letter of Credit Facility Discharge Event” means the occurrence of any one of the following:

(i) the Discharge of the Letter of Credit Facility Obligations, or

(ii) the “Date of Full Satisfaction” as defined under the Letter of Credit Facility, or

(iii) the funding, payment, prepayment, reimbursement, or cash collateralization of the obligations of the Company, the SVF Obligor or any other obligor under the Letter of Credit Facility (whether by the Company or any of its subsidiaries, the SVF Obligor or any other person), in each case, in full and in cash, including any funding, payment, prepayment, reimbursement or cash collateralization or prepayment in accordance with Section 11.1 or Section 11.2 of the Letter of Credit Facility or in accordance with the Parent Indemnity, or

 

27

(iv) any SVF Party is subrogated to the rights of the Letter of Credit Facility Secured Parties as a result of the funding, payment, prepayment, reimbursement, or cash collateralization of the obligations of the Company, any SVF Party or any other obligor under the Letter of Credit Facility pursuant to Sections 11.1 or 11.2 thereof, in each case, in full and in cash.

“Letter of Credit Facility Obligations” means all “Obligations” as defined in the Letter of Credit Facility (or similar term in any Refinancing Indebtedness in respect of the Letter of Credit Facility Obligations).

“Letter of Credit Facility Secured Parties” means the “Secured Parties” as defined in the Letter of Credit Facility (or similar term in any Refinancing of the Letter of Credit Facility).

“Letter of Credit Facility Security Documents” means the “WeWork Security Documents” as defined in the Letter of Credit Facility (or similar term in any Refinancing of the Letter of Credit Facility).

“Lien” means, with respect to any asset, any mortgage, lien, pledge, hypothecation, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof or sale/leaseback, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction; provided that in no event shall an operating lease or any lease entered into after the Reference Date that would have been classified as an operating lease pursuant to GAAP be deemed to constitute a Lien.

“Long Derivative Instrument” means a Derivative Instrument (i) the value of which generally increases, and/or the payment or delivery obligations under which generally decrease, with positive changes to the Performance References and/or (ii) the value of which generally decreases, and/or the payment or delivery obligations under which generally increase, with negative changes to the Performance References.

“Material Indebtedness” means any Indebtedness with any outstanding aggregate principal amount exceeding $50.00 million.

“Material Intellectual Property” means intellectual property owned by the Company or its Restricted Subsidiaries that is material to the business, operations, assets, financial condition or prospects of the Company and its Subsidiaries, taken as a whole.

“Moody’s” means Moody’s Investors Service, Inc. or any successor to its rating agency business.

“Net Available Cash” from an Asset Disposition means cash payments received (including any cash received from the sale or other disposition of any Designated Non-cash Consideration received as consideration in such Asset Disposition, but only as and when received) therefrom, in each case net of:

(1) fees, out-of-pocket expenses and other direct costs relating to such Asset Disposition and the sale or other disposition of such Designated Non-cash Consideration, including, without limitation, all legal, accounting, investment banking, title and recording tax expenses, commissions and other fees and expenses Incurred, and all federal, state, provincial, foreign and local taxes required to be paid or accrued as a liability under GAAP (after taking into account any available tax credits or deductions and any tax sharing agreements), as a consequence of such Asset Disposition, sale or other disposition;

 

28

(2) all payments made on any Indebtedness that is secured by any assets subject to such Asset Disposition, sale or other disposition, in accordance with the terms of any Lien upon such assets, or which must by its terms, or in order to obtain a necessary consent to such Asset Disposition, sale or other disposition, or by applicable law be repaid out of the proceeds from such Asset Disposition, sale or other disposition;

(3) all distributions and other payments required to be made to noncontrolling interest holders in Subsidiaries or joint ventures as a result of such Asset Disposition, sale or other disposition; and

(4) the deduction of appropriate amounts to be provided by the seller as a reserve, in accordance with GAAP, against any liabilities associated with the assets disposed of in such Asset Disposition, sale or other disposition and retained by the Company or any Restricted Subsidiary after such Asset Disposition, sale or other disposition.

“Net Cash Proceeds,” with respect to any issuance or sale of Equity Interests, means the cash proceeds of such issuance or sale, net of out-of-pocket fees and expenses directly relating to such issuance or sale.

“Net Short” means, with respect to a Holder or beneficial owner, as of a date of determination, either (i) the value of its Short Derivative Instruments exceeds the sum of the (x) the value of its First Lien Notes plus (y) the value of its Long Derivative Instruments as of such date of determination or (ii) it is reasonably expected that such would have been the case were a Failure to Pay or Bankruptcy Credit Event (each as defined in the 2014 ISDA Credit Derivatives Definitions) to have occurred with respect to the Issuer or any Guarantor immediately prior to such date of determination.

“Non-Controlling Authorized Representative” means, at any time with respect to any Shared Collateral, the Authorized Representative that is not the Controlling Authorized Representative at such time with respect to such Shared Collateral.

“Non-Controlling Authorized Representative Enforcement Date” means the date which is 90 days after the occurrence of both (i) an Event of Default (under and as defined in this First Lien Indenture) and (ii) each Authorized Representative’s receipt of written notice from the Non-Controlling Authorized Representative certifying that (x) an Event of Default (under and as defined in this First Lien Indenture) has occurred and is continuing and (y) the Parity Lien Obligations of the Series with respect to which the Non-Controlling Authorized Representative is the Authorized Representative are currently due and payable in full (whether as a result of acceleration thereof or otherwise) in accordance with the terms of this First Lien Indenture; provided, that the Non-Controlling Authorized Representative Enforcement Date shall be stayed and shall not occur and shall be deemed not to have occurred with respect to any Shared Collateral (1) at any time the Controlling Authorized Representative has commenced and is diligently pursuing any Enforcement Action with respect to all or a material portion of the Shared Collateral or (2) at any time the Guarantor which has granted a security interest in such Shared Collateral is then a debtor under or with respect to (or otherwise subject to) any Insolvency or Liquidation Proceeding.

 

29

“Non-Controlling Secured Parties” means, with respect to any Shared Collateral, the Parity Lien Secured Parties which are not Controlling Secured Parties with respect to such Shared Collateral.

“Non-Guarantor Subsidiary” means any Restricted Subsidiary that is not a Guarantor.

“Non-Recourse Debt” means Indebtedness of a Person:

(1) as to which neither the Company nor any Restricted Subsidiary (a) provides any Guarantee or credit support of any kind (including any undertaking, Guarantee, indemnity, agreement or instrument that would constitute Indebtedness) or (b) is directly or indirectly liable (as a guarantor or otherwise), other than a pledge of Equity Interests of an Unrestricted Subsidiary owned by the Company;

(2) no default with respect to which (including any rights that the holders thereof may have to take Enforcement Action against an Unrestricted Subsidiary) would permit (upon notice, lapse of time or both) any holder of any other Indebtedness of the Company or any Restricted Subsidiary to declare a default under such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its Stated Maturity; and

(3) the explicit terms of which provide there is no recourse against any of the assets of the Company or its Restricted Subsidiaries, other than Equity Interests of an Unrestricted Subsidiary owned by the Company or its Restricted Subsidiaries.

“Notes Creditors” means, collectively, the Trustee, the Collateral Agent and the Holders.

“Note Documents” means this First Lien Indenture, the First Lien Notes, the Note Guarantees, the Security Documents, the First Lien/Second Lien/Third Lien Intercreditor Agreement (or any other intercreditor or subordination agreement) and the Expense Reimbursement Agreement.

“Note Guarantee” means, individually, any Guarantee of payment of the First Lien Notes and the Company’s other Obligations under this First Lien Indenture by a Guarantor pursuant to the terms of this First Lien Indenture and any supplemental indenture thereto, and, collectively, all such Guarantees.

“Notes Obligations” shall mean the obligations owing pursuant to the Notes Documents.

“Obligations” means any principal, interest (including any interest accruing subsequent to the filing of a petition in bankruptcy, reorganization or similar proceeding at the rate provided for in the documentation with respect thereto, whether or not such interest is an allowed claim under applicable state, federal or foreign law), other monetary obligations, penalties, fees, premium, expenses, indemnifications, reimbursements (including reimbursement obligations with respect to letters of credit, surety or performance bonds and banker’s acceptances), damages and other liabilities, and Guarantees of payment of such principal, interest, penalties, fees, expenses, indemnifications, reimbursements, damages and other liabilities, payable under the documentation governing any Indebtedness.

 

30

“Offer to Purchase” means an Asset Disposition Offer or a Change of Control Offer.

“Offering Memorandum” means the exchange offer memorandum dated April 3, 2023, as amended and supplemented prior to April 28, 2023 related to, among other things, the offer and sale of the First Lien Notes.

“Officer” means the Chairman of the Board, the Chief Executive Officer, the President, the Chief Financial Officer, the Chief Operating Officer, the Chief Legal Officer, the General Counsel, any Executive Vice President, Senior Vice President or Vice President, the Treasurer or the Secretary of the Company or, in the event that the Company is a partnership or a limited liability company that has no such officers, a person duly authorized under applicable law by the general partner, managers, members or a similar body to act on behalf of the Company. “Officer” of any Guarantor has a correlative meaning.

“Officer’s Certificate” means a certificate signed by an Officer of the Company, and delivered to the Trustee.

“Opinion of Counsel” means a written opinion from legal counsel who is reasonably acceptable to the Trustee. The counsel may be an employee of or counsel to the Company.

“Parent Entity” means any direct or indirect parent of the Company.

“Parent Guarantee” means the unconditional guarantee on a senior unsecured basis by WeWork Inc.

“Parent Indemnity” means the Parent Indemnity, dated as of the Fifth Amendment Effective Date (as defined in the Credit Agreement), by and among SBG (as defined in the Credit Agreement) and the Senior Tranche Administrative Agent and as accepted and acknowledged by the SVF Obligor.

“Pari Passu Intercreditor Agreement” means the Intercreditor Agreement, among the Collateral Agent, as the Parity Lien Representative for the holders of the First Lien Notes and Note Guarantees, the Senior Tranche Administrative Agent, as Controlling Parity Lien Collateral Agent, the Company, the Guarantors and the other parties from time to time party thereto, to be entered into on the Issue Date, as it may be amended, restated, supplemented or otherwise modified from time to time in accordance with this First Lien Indenture and the Letter of Credit Facility.

“Parity Lien” means, as of any date, the Liens on the Shared Collateral securing the Parity Lien Debt.

“Parity Lien Collateral Agent” means, each of (i) the Senior Tranche Administrative Agent (or other Person designated by the Senior Tranche Administrative Agent or other successor thereto in such capacity in accordance with the Letter of Credit Facility) or the Junior Tranche Administrative Agent (to the extent the Junior Tranche Administrative Agent is the controlling agent under the Letter of Credit Facility), (ii) the Collateral Agent and (iii) each collateral agent or other representative of lenders or holders of Parity Lien Obligations designated pursuant to the terms of the Parity Lien Documents and the Pari Passu Intercreditor Agreement from time to time.

“Parity Lien Debt” means:

 

31

(1) Indebtedness of the Company and the Guarantors under the Letter of Credit Facility and reimbursement obligations with respect thereto;

(2) the First Lien Notes and Note Guarantees thereof and any amounts due thereunder or in connection therewith; and

(3) any other Indebtedness (other than intercompany Indebtedness owing to the Company or its Subsidiaries) of the Company or any Guarantor that is (i) secured equally and ratably with the First Lien Notes or any other Parity Lien Debt by a Parity Lien, (ii) permitted to be Incurred and so secured under Section 4.09 and Section 4.10, (iii) permitted to be Incurred and so secured under each applicable Parity Lien Document and Junior Lien Document, and (iv) has a final maturity equal to or later than, and a weighted Average Life to Stated Maturity equal to or greater than, the final maturity of the First Lien Notes; provided that, in the case of any Indebtedness referred to in clause (3) of this definition:

 

(a)

on or before the date on which such Indebtedness is Incurred by the Company or any Guarantor, such Indebtedness is designated by the Company, in an officers’ certificate delivered to each Parity Lien Representative and the Collateral Agent, as “Parity Lien Debt” for the purposes of this First Lien Indenture and the Pari Passu Intercreditor Agreement; provided, further, that no Series of Secured Debt may be designated as both “Parity Lien Debt” or “Junior Lien Debt” (or any combination of the two);

 

(b)

the Parity Lien Representative of such Parity Lien Debt shall have executed and delivered a joinder in form and substance satisfactory to the Parity Lien Secured Parties (each acting through its respective Parity Lien Representative) or any other intercreditor agreement, as applicable, in respect of such Indebtedness; and

 

(c)

all requirements set forth in the Pari Passu Intercreditor Agreement as to the confirmation, grant or perfection of the Parity Lien Representatives’ Liens to secure such Indebtedness or Obligations in respect thereof are satisfied (and the satisfaction of such requirements and the other provisions of this clause (3) will be conclusively established if the Company delivers to the Controlling Parity Lien Collateral Agent an officers’ certificate stating that such requirements and other provisions have been satisfied and that such Indebtedness is “Parity Lien Debt”).

“Parity Lien Documents” means, collectively, the Letter of Credit Facility, the Letter of Credit Facility Security Documents, the Note Documents, and any additional indenture, supplemental indenture, credit agreement or other agreement governing each other Series of Parity Lien Obligations and the Security Documents (other than any security documents that do not secure Parity Lien Obligations).

“Parity Lien Obligations” means, collectively, (i) (x) the Letter of Credit Facility Obligations and (y) the Notes Obligations and (ii) to the extent that the SVF Obligor (as defined in the Letter of Credit Facility) or any other person funds, pays, prepays, reimburses or cash collateralizes the Letter of Credit Facility, any claims of subrogation of such SVF Obligor or such other person to the extent thereof.

 

32

“Parity Lien Representative” means:

(1) in the case of the First Lien Notes, the Trustee;

(2) in the case of the Letter of Credit Facility, the Senior Tranche Administrative Agent (or other Person designated by the Senior Tranche Administrative Agent or other successor thereto in such capacity in accordance with the Letter of Credit Facility) or the Junior Tranche Administrative Agent (to the extent the Junior Tranche Administrative Agent is the controlling agent under the Letter of Credit Facility); and

(3) in the case of any other Series of Parity Lien Debt, the trustee, agent or representative of the holders of such Series of Parity Lien Debt who (a) is appointed as a Parity Lien Representative (for purposes related to the administration of the Security Documents) pursuant to this First Lien Indenture, credit agreement or other agreement governing such Series of Parity Lien Debt, together with its successors in such capacity, and (b) has become a party to the Pari Passu Intercreditor Agreement as a “Parity Lien Representative” by a joinder in the form required under the Pari Passu Intercreditor Agreement.

“Parity Lien Secured Parties” means, at any time, (i) the Holders, each Parity Lien Collateral Agent, the Trustee, each lender, holder, agent, Issuing Creditor or L/C Participant (each as defined in the Letter of Credit Facility as in effect on the date hereof) under the Letter of Credit Facility or other Series of Parity Lien Debt and (ii) and the SVF Obligor or any other person, to the extent the SVF Obligor or such other person is subrogated to the rights of the Letter of Credit Facility Secured Parties (it being understood that the exercise by the SVF Obligor of any right of subrogation, reimbursement, contribution or any other right to enforce any remedy against the Company and the Guarantors shall be subject to Section 2.14(b) of the Letter of Credit Facility).

“Partnership” means The We Company Management Holdings L.P. and any successor entity.

“Partnership Agreement” means the Third Amended and Restated Agreement of Exempted Limited Partnership of The We Company Management Holdings L.P., as in effect on the Issue Date.

“Permitted Additional First Lien Indebtedness” means any additional Secured Indebtedness or other Indebtedness that is secured by a Lien on the Collateral that ranks pari passu in right of security with the Lien on the Collateral securing the First Lien Notes.

“Permitted Business” means any business conducted or proposed to be conducted by the Company and its Restricted Subsidiaries on the Reference Date or any business that is similar, related, complementary, incidental or ancillary thereto, or that is an extension, development or expansion thereof.

“Permitted Holders” means each of the Investors, any Permitted Parent and any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) of which any of the foregoing or any Person or group specified in the last sentence of this definition are members and any member of such group; provided that, in the case of such group and without giving effect to the existence of such group or any other group, such Investor, Permitted Parent and Person or group specified in the last sentence of this definition, collectively, own, directly or indirectly, more than 50% of the total voting power of the Voting Stock of the Company. Any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of

 

33

the Exchange Act) whose acquisition of beneficial ownership constitutes a Change of Control in respect of which a Change of Control Offer is made in accordance with the requirements of this First Lien Indenture (or would result in a Change of Control Offer in the absence of the waiver of such requirement by Holders in accordance with this First Lien Indenture) will thereafter constitute an additional Permitted Holder.

“Permitted Investment” means an Investment by the Company or any Restricted Subsidiary in:

(1) the Company or a Restricted Subsidiary;

(2) a Person if as a result of such Investment:

 

(a)

such Person becomes a Restricted Subsidiary; or

 

(b)

such Person, in one transaction or a series of related transactions, is merged or consolidated with or into, or transfers or conveys all or substantially all of its assets to, or is liquidated into, the Company or a Restricted Subsidiary,

and, in each case, any Investment held by such Person; provided that such Investment was not acquired by such Person in contemplation of such acquisition, merger, consolidation or transfer;

(3) cash and Cash Equivalents;

(4) extensions of trade credit and receivables owing to the Company or any Restricted Subsidiary created or acquired in the ordinary course of business (whether or not consistent with past practice) and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Company or any such Restricted Subsidiary deems reasonable under the circumstances;

(5) payroll, travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes and that are made in the ordinary course of business (whether or not consistent with past practice);

(6) loans or advances to employees, officers or directors of the Company or any Restricted Subsidiary not to exceed $10.00 million at any time outstanding;

(7) any Investment acquired by the Company or any of its Restricted Subsidiaries:

 

(a)

in exchange for any other Investment or accounts receivable held by the Company or any such Restricted Subsidiary in connection with or as a result of a bankruptcy, workout, reorganization or recapitalization of the issuer of such other Investment or accounts receivable; or

 

(b)

as a result of a foreclosure by the Company or any of its Restricted Subsidiaries with respect to any secured Investment or other transfer of title with respect to any secured Investment in default;

(8) Investments made as a result of the receipt of non-cash consideration (including Designated Non-cash Consideration) from an Asset Disposition that was made pursuant to and in compliance with Section 4.16 or any other disposition of assets not constituting an Asset Disposition;

 

34

(9) Investments in existence on the Issue Date, or made pursuant to any commitment in existence on the Issue Date, and any extension, modification or renewal of any such Investments, but only to the extent such extension, modification or renewal does not involve additional advances, contributions or other Investments of cash or other assets or other increases thereof (other than as a result of the accrual or accretion of interest or original discount or the issuance of payment-in-kind securities, in each case pursuant to the terms of such Investment as in effect on the Issue Date);

(10) Hedging Obligations Incurred in compliance with Section 4.09;

(11) Guarantees issued in accordance with Section 4.09 and Specified Real Estate Finance Guarantees;

(12) Investments made in connection with the funding of contributions under any non-qualified retirement plan or similar employee compensation plan in an amount not to exceed the amount of compensation expense recognized by the Company and its Restricted Subsidiaries in connection with such plans;

(13) advances or other payments by the Company or any of its Restricted Subsidiaries to fund operating and other expenditures pursuant to profit-sharing and/or franchise agreements entered into in the ordinary course of business (whether or not consistent with past practice) set forth in long-term written agreements with third parties; provided that any related real estate or other assets occupied by such third parties are not recorded on the consolidated balance sheet of the Company and its Restricted Subsidiaries;

(14) lease, utility and other similar deposits in the ordinary course of business (whether or not consistent with past practice); and

(15) the portion of any Investments made with Equity Interests of the Company that are not Disqualified Stock.

“Permitted Liens” means, with respect to any Person:

(1) Liens securing Indebtedness and other obligations permitted to be Incurred under Section 4.09(b)(1), (2), (20), (21), (22), (23) and (24), related Hedging Obligations and related banking services or Cash Management Obligations and Liens on assets of Restricted Subsidiaries securing Guarantees of such Indebtedness and such other obligations of the Company , which Liens may rank equal in priority to the Liens securing the First Lien Notes in the case of Indebtedness Incurred pursuant to Section 4.09(b)(1) and (2), and shall rank junior in priority to the Liens securing the First Lien Notes in the case of Indebtedness Incurred pursuant to Section 4.09(b)(20), (21), (22), (23) and (24);

(2) pledges or deposits by such Person under workers’ compensation laws, unemployment insurance laws or similar legislation, or good faith deposits in connection with bids, tenders, contracts (other than for the payment of Indebtedness) or leases to which such Person is a party, or deposits to secure public or statutory obligations of such Person, or deposits as security for contested taxes or import or customs duties or for the payment of rent, in each case Incurred in the ordinary course of business (whether or not consistent with past practice);

 

35

(3) Liens imposed by law, including carriers’, warehousemen’s, mechanics’, materialmen’s and repairmen’s Liens, Incurred in the ordinary course of business (whether or not consistent with past practice);

(4) Liens for taxes, assessments or other governmental charges not yet subject to penalties for non-payment or that are being contested in good faith by appropriate proceedings; provided that any reserves required pursuant to GAAP have been made in respect thereof;

(5) Liens to secure surety or performance bonds or letters of credit or bankers’ acceptances or similar obligations issued pursuant to the request of and for the account of such Person in the ordinary course of its business (whether or not consistent with past practice), other than any such obligation Incurred under Section 4.09(b)(1);

(6) encumbrances, ground leases, easements or reservations of, or rights of others for, licenses, rights of way, sewers, electric lines, drains, telegraph, television and telephone lines and other similar purposes, or zoning, building codes or other restrictions (including, without limitation, minor defects or irregularities in title and similar encumbrances) as to the use of real property or Liens incidental to the conduct of the business of such Person or to the ownership of its properties that do not materially adversely affect the value of said properties or materially impair their use in the operation of the business of the Company and its Restricted Subsidiaries taken as a whole;

(7) Liens securing Hedging Obligations that are Incurred in the ordinary course of business (whether or not consistent with past practice) and not for speculative purposes;

(8) leases, licenses, subleases and sublicenses of assets (including, without limitation, real property and intellectual property rights) that do not materially interfere with the conduct of the business of the Company and its Restricted Subsidiaries, taken as a whole;

(9) Liens arising out of judgments, decrees, orders or awards in respect of which the Company or a Restricted Subsidiary shall in good faith be prosecuting an appeal or proceedings for the review of such judgment, which appeal or proceedings have not been finally terminated or the period within which such appeal or proceedings may be initiated has not expired;

(10) Liens to secure Indebtedness permitted by Section 4.09(b)(9) covering only the assets acquired with such Indebtedness (plus improvements, accessions, proceeds or dividends or distributions in respect thereof); provided that:

 

(a)

the aggregate principal amount of Indebtedness secured by such Liens is otherwise permitted to be Incurred under this First Lien Indenture and does not exceed the cost of the assets or property so acquired, constructed or improved; and

 

(b)

such Liens are created within 270 days of construction, acquisition or improvement of such assets or property and do not encumber any other assets or property of the Company or any Restricted Subsidiary other than such assets or property and assets affixed or appurtenant thereto;

(11) Liens arising solely by virtue of any statutory or common law provisions relating to banker’s Liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a depositary institution;

 

36

(12) Liens arising from Uniform Commercial Code financing statement filings regarding operating leases or consignments entered into by the Company and its Restricted Subsidiaries;

(13) Liens existing on the Issue Date (other than Liens permitted under clause (1));

(14) Liens on property or shares of stock of a Person at the time such Person becomes a Restricted Subsidiary or is merged with or into or consolidated with the Company or a Restricted Subsidiary; provided, however, that such Liens are not Incurred in connection with, or in contemplation of, such acquisition, merger or consolidation; provided, further, however, that any such Lien may not extend to any other property owned by the Company or any Restricted Subsidiary;

(15) Liens on property at the time the Company or a Restricted Subsidiary acquired the property; provided, however, that such Liens are not Incurred in connection with, or in contemplation of, such acquisition; provided, further, however, that such Liens may not extend to any other property owned by the Company or any Restricted Subsidiary;

(16) Liens securing Indebtedness or other Obligations of a Restricted Subsidiary owing to the Company or another Restricted Subsidiary;

(17) [reserved];

(18) Liens securing Refinancing Indebtedness Incurred to refinance, refund, replace, amend, extend or modify, as a whole or in part, Indebtedness that was previously so secured pursuant to clauses (1), (10), (13), (14), (15) and this clause (18) of this definition; provided that (x) any such Lien has the same or junior priority relative the Lien securing the Indebtedness being refinanced being replaced and (y) such Lien is limited to all or part of the same property or assets (plus improvements, accessions, proceeds or dividends or distributions in respect thereof) that secured (or, under the written arrangements under which the original Lien arose, could secure) the Indebtedness being refinanced;

(19) any interest or title of a lessor under any Capitalized Lease Obligation or operating lease;

(20) Liens in favor of the Company or any Restricted Subsidiary;

(21) Liens securing security deposits pursuant to bona fide lease agreements in the ordinary course of business (whether or not consistent with past practice);

(22) customary restrictions on, or options, contracts or other arrangements for, transfers of assets contained in agreements related to any sale of assets pending such sale; provided that such restrictions apply only to the assets to be sold and such sale is otherwise permitted by this First Lien Indenture;

(23) Liens on trusts, cash or Cash Equivalents or other funds in connection with the defeasance, discharge or redemption of Indebtedness, pending consummation of a strategic transaction, or similar obligations;

(24) any interest or title of a lessor under any lease entered into by the Company or any Subsidiary in the ordinary course of business (whether or not consistent with past practice) and covering only the assets so leased and other statutory and common law landlords’ Liens under leases, and financing statements related thereto;

 

37

(25) in the case of any joint venture, any put and call arrangements related to the respective joint venture’s Equity Interests set forth in its organizational documents or any related joint venture or similar agreement;

(26) Liens on insurance policies and the proceeds thereof securing the financing of the premiums with respect thereto;

(27) Liens on Equity Interests of Unrestricted Subsidiaries securing Non-Recourse Debt of the Company or a Restricted Subsidiary;

(28) Junior Liens securing Indebtedness Incurred pursuant to Section 4.09(b)(14); provided that any such Indebtedness shall be secured only by the assets (including all accessions, attachments, improvements and proceeds thereof) acquired, constructed or improved in connection with the Incurrence of such Indebtedness; and

(29) other Liens so long as the aggregate outstanding principal amount of the Obligations secured thereby at any one time outstanding does not exceed $50.00 million, which Liens Incurred under this clause (29) shall rank junior in priority to the Liens on the Collateral securing the First Lien Notes.

In the event that the a Permitted Lien meets the criteria of more than one types of Permitted Liens (at the time of Incurrence or at a later date), the Company in its sole discretion may divide, classify or from time to time reclassify all or any portion of such Permitted Lien in any manner that complies with this definition, and such Permitted Lien shall be treated as having been made pursuant only to the clause or clauses of this definition of “Permitted Lien” to which such Permitted Lien has been classified or reclassified.

“Permitted Parent” means any direct or indirect parent company of the Company (other than a Person formed in connection with, or in contemplation of, a Change of Control transaction, merger, sale or other transfer of equity interests or assets of the Company that results in a modification of the beneficial ownership of the Company) that beneficially owns 100% of the Capital Stock of the Company; provided that the ultimate beneficial ownership of the Company has not been modified by the transaction by which such parent company became the beneficial owner of 100% of the Capital Stock of the Company and such parent company owns no assets other than Cash Equivalents and the Capital Stock of the Company or any other Permitted Parent.

“Person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint stock company, trust, unincorporated organization, Government Authority or any agency or political subdivision thereof or any other entity.

“PIK Interest” means interest payable on the First Lien Notes by increasing the aggregate principal amount of an outstanding Global Note or issuing PIK Notes under this First Lien Indenture having the same terms as the Initial Notes, subject to the terms of Exhibit A.

“PIK Payment” means any payment of PIK Interest on any Interest Payment Date for the interest period ended on such date.

 

38

“Preferred Stock,” as applied to the Capital Stock of any corporation, means Capital Stock of any class or classes (however designated) which is preferred as to the payment of dividends, or as to the distributions of assets upon any voluntary or involuntary liquidation or dissolution of such corporation, over shares of Capital Stock of any other class of such corporation.

“Property” means any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including, without limitation, cash, securities, accounts and contract rights.

“Record Date” for the interest payable on any applicable Interest Payment Date means the March 15 or September 15 (whether or not a Business Day) immediately preceding such Interest Payment Date.

“Reference Date” means April 30, 2018.

“Refinancing Indebtedness” means Indebtedness that is Incurred to refund, refinance, replace, exchange, renew, repay or extend (including pursuant to any defeasance or discharge mechanism) (collectively, “refinance,” “refinances,” “refinanced” and “refinancing” shall each have a correlative meaning) all or a portion of any Indebtedness existing on the Issue Date or Incurred in compliance with this First Lien Indenture (including additional Indebtedness Incurred to pay premiums (including reasonable tender premiums, as determined in good faith by an Officer of the Company), defeasance costs, accrued interest (including, for the avoidance of doubt, payment-in-kind interest) and fees and expenses in connection with any such refinancing) including Indebtedness that refinances Refinancing Indebtedness; provided, however, that:

(1) (a) if the Stated Maturity of the Indebtedness being refinanced is earlier than the Stated Maturity of the First Lien Notes or if such Indebtedness is Parity Lien Debt, the Refinancing Indebtedness has a Stated Maturity no earlier than the Stated Maturity of the Indebtedness being refinanced or (b) if the Stated Maturity of the Indebtedness being refinanced is later than the Stated Maturity of the First Lien Notes or if such Indebtedness is Restricted Debt, the Refinancing Indebtedness has a Stated Maturity at least 91 days later than the Stated Maturity of the First Lien Notes;

(2) the Refinancing Indebtedness has an Average Life at the time such Refinancing Indebtedness is Incurred that is equal to or greater than the Average Life of the Indebtedness being refinanced;

(3) such Refinancing Indebtedness is Incurred in an aggregate principal amount (or if issued with original issue discount, an aggregate issue price) that is equal to or less than the sum of the aggregate principal amount (or if issued with original issue discount, the aggregate accreted value) then outstanding of the Indebtedness being refinanced (plus, without duplication, any additional Indebtedness Incurred to pay premiums (including reasonable tender premiums, as determined in good faith by an Officer of the Company), defeasance costs, accrued interest and fees and expenses (including fees and expenses relating to the Incurrence of such Refinancing Indebtedness) in connection with any such refinancing);

(4) if the Indebtedness being refinanced is subordinated in right of payment to the First Lien Notes or the Note Guarantees, such Refinancing Indebtedness is subordinated in right of payment to the First Lien Notes or the Note Guarantees on terms at least as favorable to the Holders as those contained in the documentation governing the Indebtedness being refinanced; and

 

39

(5) Refinancing Indebtedness shall not include Indebtedness of a Non-Guarantor Subsidiary that refinances Indebtedness of the Company or a Guarantor.

“Required First Lien Noteholders” means, at any time, the holders of a majority in aggregate principal amount of each Series of First Lien Notes outstanding as modified by Section 9.02(g).

“Required Secured Noteholders” means, at any time, the holders of a majority in aggregate principal amount of the First Lien Notes as modified by Section 9.02(g); provided that, with respect to each Series of First Lien Notes, the holders of a majority in aggregate principal amount of First Lien Notes in such Series shall be deemed to vote the full outstanding principal amount of such Series.

“Restricted Debt” means (i) the Existing Unsecured Notes, (ii) any Junior Lien Debt and (iii) any other Indebtedness of the Issuers or a Guarantor that is not Secured Indebtedness (including Indebtedness in respect of Subordinated Obligations).

“Responsible Officer” means, when used with respect to the Trustee or the Collateral Agent, any officer within the corporate trust department of the Trustee or the Collateral Agent, as applicable, having direct responsibility for the administration of this First Lien Indenture, the Security Document or the First Lien/Second Lien/Third Lien Intercreditor Agreement, as applicable, or any other officer to whom any corporate trust matter is referred because of such officer’s knowledge of and familiarity with the particular subject.

“Restricted Investment” means any Investment other than a Permitted Investment.

“Restricted Subsidiary” means any Subsidiary of the Company other than an Unrestricted Subsidiary.

“S&P” means S&P Global Ratings, a division of S&P Global Inc., or any successor to its rating agency business.

“Sale/Leaseback Transaction” means an arrangement relating to property now owned or hereafter acquired whereby the Company or a Restricted Subsidiary transfers such property to a Person (other than the Company or any of its Restricted Subsidiaries) and the Company or a Restricted Subsidiary leases it from such Person.

“SBG” means SoftBank Group Corp. and its Affiliates (excluding, for the avoidance of doubt, WeWork Inc. and its Subsidiaries) or any of their successors or assigns.

“Screened Affiliate” means any Affiliate of a Holder (i) that makes investment decisions independently from such Holder and any other Affiliate of such Holder that is not a Screened Affiliate, (ii) that has in place customary information screens between it and such Holder and any other Affiliate of such Holder that is not a Screened Affiliate and such screens prohibit the sharing of information with respect to the Company or its Subsidiaries, (iii) whose investment policies are not directed by such Holder or any other Affiliate of such Holder that is acting in concert with such Holder in connection with its investment in the First Lien Notes, and (iv) whose investment decisions are not influenced by the investment decisions of such Holder or any other Affiliate of such Holder that is acting in concert with such Holders in connection with its investment in the First Lien Notes.

 

40

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

“Second Lien Exchangeable Notes” means the Company’s 11.000% Second Lien Exchangeable Senior Secured PIK Notes due 2027.

“Second Lien Exchangeable Note Documents” means the Second Lien Exchangeable Notes Indenture, the Second Lien Exchangeable Notes, the Second Lien Exchangeable Note Guarantees, the Second Priority Lien Security Documents and the First Lien/Second Lien/Third Lien Intercreditor Agreement.

“Second Lien Exchangeable Note Guarantees” means, individually, any Guarantee of payment of the Second Lien Exchangeable Notes and the Company’s other Obligations under the Second Lien Exchangeable Indenture by a Guarantor pursuant to the terms of the Second Lien Exchangeable Indenture and any supplemental indenture thereto, and, collectively, all such Guarantees.

“Second Lien Indenture” means that certain Second Lien Senior Secured PIK Notes Indenture, dated as of May 5, 2023, by and among the Company, the Co-Obligor, the guarantors listed therein and U.S. Bank Trust Company, National Association, as trustee and collateral agent, as amended, supplemented, restated or otherwise modified from time to time, relating to the Second Lien Notes.

“Second Lien Notes” means the Company’s 11.000% Second Lien Senior Secured PIK Notes due 2027 issued pursuant to the Second Lien Indenture.

“Second Lien Note Documents” means the Second Lien Notes Indenture, the Second Lien Notes, the Second Lien Note Guarantees, the Second Priority Lien Security Documents and the First Lien/Second Lien/Third Lien Intercreditor Agreement.

“Second Lien Note Guarantees” means, individually, any Guarantee of payment of the Second Lien Notes and the Company’s other Obligations under the Second Lien Indenture by a Guarantor pursuant to the terms of the Second Lien Indenture and any supplemental indenture thereto, and, collectively, all such Guarantees.

“Second Priority Lien” means the Liens on the Collateral securing the Second Priority Lien Debt pursuant to the Second Priority Lien Documents.

“Second Priority Lien Collateral Agency Agreement” means the collateral agency agreement with respect to the Second Lien Notes among the Company, the Guarantors, the Second Priority Lien Collateral Agent, the Second Priority Lien Trustee, and the other Second Priority Lien Representatives from time to time party thereto.

“Second Priority Lien Collateral Agent” means the collateral agent under the Second Lien Notes and the Second Lien Exchangeable Notes.

“Second Priority Lien Debt” means:

 

41

(1) the Second Lien Notes issued on the Issue Date and Second Lien Note Guarantees thereof;

(2) the Second Lien Exchangeable Notes and Second Lien Exchangeable Note Guarantees thereof; and

(3) any other Indebtedness (other than intercompany Indebtedness owing to the Company or its Subsidiaries) of the Company or any Guarantor that is (i) secured equally and ratably with the Second Lien Notes, Second Lien Exchangeable Notes or any other Second Priority Lien Debt by a Second Priority Lien, (ii) permitted to be Incurred and so secured under Section 4.08 and Section 4.09, (iii) permitted to be Incurred and so secured under each applicable Parity Lien Document, Second Priority Lien Document, Third Priority Lien Document and Junior Lien Document, and (iv) has a final maturity equal to or later than, and a weighted Average Life to Stated Maturity equal to or greater than, the final maturity of the Second Lien Notes; provided that, in the case of any Indebtedness referred to in clause (3) of this definition:

(a) on or before the date on which such Indebtedness is Incurred by the Company or any Guarantor, such Indebtedness is designated by the Company, in an officers’ certificate delivered to each Second Priority Lien Representative and the Second Priority Lien Collateral Agent, as “Second Priority Lien Debt” for the purposes of this First Lien Indenture and the Second Priority Lien Collateral Agency Agreement; provided, further, that no Series of Secured Debt may be designated as “Parity Lien Debt” and “Second Priority Lien Debt” or “Third Priority Lien Debt” or “Junior Lien Debt” (or any combination of the four);

(b) the Second Priority Lien Representative of such Second Priority Lien Debt (other than additional notes issued under the same indenture as the Second Lien Notes, if any) shall have executed and delivered an Additional Secured Debt Designation (as defined in the Second Priority Lien Collateral Agency Agreement) on behalf of itself and all holders of such Indebtedness; and

(c) all requirements set forth in the Second Priority Lien Collateral Agency Agreement as to the confirmation, grant or perfection of the Collateral Agent’s Liens to secure such Indebtedness or Obligations in respect thereof are satisfied (and the satisfaction of such requirements and the other provisions of this clause (3) will be conclusively established if the Company delivers to the Second Priority Lien Collateral Agent an officers’ certificate stating that such requirements and other provisions have been satisfied and that such Indebtedness is “Second Priority Lien Debt”).

“Second Priority Lien Documents” means, collectively, the Second Lien Note Documents, the Second Lien Exchangeable Note Documents and any additional indenture, supplemental indenture, credit agreement or other agreement governing each other Series of Second Priority Lien Debt and the Second Priority Lien Security Documents (other than any security documents that do not secure Second Priority Lien Obligations).

“Second Priority Lien Obligations” means Second Priority Lien Debt and all other Obligations in respect thereof.

“Second Priority Lien Representative” means:

(1) in the case of the Second Lien Notes, the Second Priority Lien Trustee;

 

42

(2) in the case of the Second Lien Exchangeable Notes, the trustee of the Second Lien Exchangeable Notes; or

(3) in the case of any other Series of Second Priority Lien Debt, the trustee, agent or representative of the holders of such Series of Second Priority Lien Debt who (a) is appointed as a Second Priority Lien Representative (for purposes related to the administration of the applicable security documents) pursuant to the indenture, credit agreement or other agreement governing such Series of Second Priority Lien Debt, together with its successors in such capacity, and (b) has become a party to the Second Priority Lien Collateral Agency Agreement as a “Second Priority Lien Representative” by a joinder in the form required under the Second Priority Lien Collateral Agency Agreement.

“Second Priority Lien Security Documents” means the security agreements, pledge agreements, mortgages, deeds of trust, collateral assignments and related agreements, as amended, supplemented, restated, renewed, refunded, replaced, restructured, repaid, refinanced or otherwise modified from time to time, creating the security interest in the Collateral as contemplated by the Second Lien Note Documents and the Second Lien Exchangeable Note Documents.

“Second Priority Lien Secured Parties” means, at any time, the holders of the Second Lien Notes, the Second Priority Lien Trustee, the holders of the Second Lien Exchangeable Notes, trustee of the Second Lien Exchangeable Notes and the Second Priority Lien Collateral Agent.

“Second Priority Lien Trustee” means, at any time, the trustee under the Second Lien Notes.

“Secured Debt Documents” means the Parity Lien Documents, the Second Priority Lien Documents, the Third Priority Lien Documents and the Junior Lien Documents.

“Secured Indebtedness” means Indebtedness consisting of Indebtedness for borrowed money, letters of credit (only to the extent of any unreimbursed drawings thereunder), debt obligations evidenced by promissory notes and similar instruments and Guarantees in respect of any of the foregoing, in each case secured by a Lien. For the avoidance of doubt, “Secured Indebtedness” shall not include Indebtedness described in clause (5) of the definition thereof or any Guarantees in respect thereof.

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder.

“Security Documents” means any security agreements, pledge agreements, collateral assignments, mortgages, deeds of trust, collateral agency agreements, control agreements or other grants or transfers for security executed and delivered by the Company or any Guarantor creating (or purporting to create) a Lien upon Collateral in favor of the Collateral Agent, in each case, as amended, modified, renewed, restated or replaced, in whole or in part, from time to time, in accordance with its terms and Article 12.

“Senior L/C Tranche” means the facility in respect of the aggregate Senior Tranche L/C Commitments and L/C Exposure of the Senior Tranche L/C Participants (each as defined in the Letter of Credit Facility as in effect on the date hereof).

 

43

“Senior Tranche Administrative Agent” means Goldman Sachs International Bank, together with its affiliates, as the administrative agent for the Senior Tranche Issuing Creditors and the Senior Tranche L/C Participants (each as defined in the Letter of Credit Facility as in effect on the date hereof) under the Letter of Credit Facility, and as shared collateral agent with respect to the SVF Collateral and the WeWork Collateral for the Senior Tranche Issuing Creditors, the Senior Tranche L/C Participants, the Junior Tranche Issuing Creditor and the Junior Tranche L/C Participants (each as defined in the Letter of Credit Facility as in effect on the date hereof), together with any of its permitted successors and assigns.

“Series” means (a) with respect to the Parity Lien Secured Parties, Second Priority Lien Secured Parties, Third Priority Lien Secured Parties or secured parties in respect of any Junior Lien Debt, as applicable, each of (i) the Letter of Credit Facility Secured Parties (in their capacities as such); it being understood and agreed that the Letter of Credit Facility Secured Parties (in their capacities as such) in respect of the Senior L/C Tranche, together with the Letter of Credit Facility Secured Parties (in their capacities as such) in respect of the Junior L/C Tranche, collectively, shall constitute one Series for all purposes hereunder, (ii) the Notes Creditors, (iii) the Second Priority Lien Secured Parties and (iv) the Third Priority Lien Secured Parties and (b) with respect to any Parity Lien Obligations, Second Priority Lien Secured Parties, Third Priority Lien Secured Parties or Junior Lien Obligations, as applicable, each of (i) the Letter of Credit Facility Obligations; it being understood and agreed that the Letter of Credit Facility Obligations in respect of the Senior L/C Tranche, together with the Letter of Credit Facility Obligations in respect of the Junior L/C Tranche, collectively, shall constitute one Series for all purposes hereunder, (ii) the Notes Obligations, (iii) the Second Priority Lien Obligations, (iv) the Third Priority Lien Obligations and (v) the Junior Lien Obligations. For the avoidance of doubt, the term “First Lien Notes of the applicable Series” and similar phrases shall refer to First Lien Notes that constitute Series I First Lien Notes, Series II First Lien Notes and/or Series III First Lien Notes, as the context requires.

“Series I First Lien Notes” means the Initial Series I Notes and any related PIK Notes of such Series.

“Series II First Lien Notes” means the Initial Series II Notes and any related PIK Notes of such Series.

“Series III First Lien Notes” means the Initial Series III Notes and any related PIK Notes of such Series.

“Series of Junior Lien Debt” means, severally, each issue or series of Junior Lien Debt for which a single transfer register is maintained.

“Series of First Lien Notes” means the Series I First Lien Notes, the Series II First Lien Notes or the Series III First Lien Notes.

“Series of Parity Lien Debt” means, severally, the First Lien Notes and each other issue or series of Parity Lien Debt for which a single transfer register is maintained.

“Series of Secured Debt” means each Series of Parity Lien Debt and each Series of Junior Lien Debt.

 

44

“Shared Collateral” means, at any time, Collateral in which the holders of the Parity Lien Obligations (or their respective Authorized Representatives on behalf of such holders) hold a valid security interest at such time; provided, that if any Series of Parity Lien Obligations (the “Benefitted Series”) has a valid security interest in any Collateral at any time that is not also Collateral at such time for all other Series of Parity Lien Obligations, then each holder of any Parity Lien Obligation of the Benefitted Series that holds a valid security interest in such Collateral shall immediately and automatically be deemed to, and does hereby agree to, hold such Collateral for the pro rata benefit of all Parity Lien Obligations outstanding at such time and such Collateral shall thereupon constitute Shared Collateral for all Parity Lien Obligations and any amounts received by or distributed to any of them in respect thereof shall be subject to the application of proceeds provisions of the Pari Passu Intercreditor Agreement; provided, that notwithstanding the foregoing, until the Discharge of Letter of Credit Facility Obligations, all Collateral in the form of cash in respect of any cash collateralized letters of credit, letters of credit exposure or mandatory cash collateral, in each case, as required under the Letter of Credit Facility shall not be considered Shared Collateral and shall remain exclusively at all times as Collateral solely for the Letter of Credit Facility Secured Parties.

“Short Derivative Instrument” means a Derivative Instrument (i) the value of which generally decreases, and/or the payment or delivery obligations under which generally increase, with positive changes to the Performance References and/or (ii) the value of which generally increases, and/or the payment or delivery obligations under which generally decrease, with negative changes to the Performance References.

“Significant Subsidiary” means any Restricted Subsidiary that would be a “Significant Subsidiary” of the Company within the meaning of Rule 1-02 under Regulation S-X promulgated by the SEC.

“Specified Hedge Agreement” means any Hedge Agreement in respect of interest rates or currency exchange rates entered into by the Company or any Guarantor and any Person that is a lender under a Debt Facility or an affiliate of such lender at the time such Hedge Agreement is entered into.

“Specified Real Estate Finance Guarantees” means guarantees not constituting Indebtedness, indemnity obligations and other contingent obligations with respect to: (a) performance obligations, (b) environmental liabilities and (c) matters which are commonly referred to as “bad-boy acts” or “recourse carve-outs” in the real estate lending industry, including, without limitation: fraud; gross negligence; willful misconduct; waste; interference with exercise of remedies; misrepresentation; misapplication or misappropriation of funds (including, without limitation, insurance proceeds or condemnation awards); undisclosed liabilities; employee-related liabilities; failure to satisfy governmental rules; commencement of a voluntary bankruptcy filing or similar proceeding by the applicable primary obligor; commencement of an involuntary bankruptcy filing or similar proceeding against the applicable primary obligor; tax assessments and claims; failure to obtain or preserve expected tax attributes; failure to comply with restrictions on sale, transfer or other disposition of assets; failure to comply with negative pledge requirements; failure to vacate premises after termination of a lease; and failure to comply with special purpose entity or bankruptcy remote requirements.

“Stated Maturity” means, with respect to any security or installment of interest or principal on any series of Indebtedness, the date specified in the agreement governing or certificate relating to such Indebtedness as the fixed date on which the final payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision, but not including any contingent obligations to repay, redeem or repurchase any such principal prior to the date originally scheduled for the payment thereof.

 

45

“Subordinated Obligation” means any Indebtedness of the Company (whether outstanding on the Issue Date or thereafter Incurred) that is expressly subordinated pursuant to its terms in right of payment to the First Lien Notes.

“Subsidiary” of any Person means:

(1) any corporation, association or other business entity of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency and after giving effect to any voting agreement or stockholders’ agreement that effectively transfers voting power) to vote in the election of directors, managers or trustees of the corporation, association or other business entity is at the time owned or controlled, directly or indirectly, by that Person or one or more other Subsidiaries of that Person (or any combination thereof); and

(2) any partnership, limited liability company or similar entity (a) the sole general partner, the managing general partner or the sole managing member of which is such Person or a Subsidiary of such Person or (b) the only general partners or managing members of which are that Person or one or more Subsidiaries of that Person (or any combination thereof).

“SVF Obligor” means the Partnership, acting by the Manager or the Jersey General Partner (each as defined in the Credit Agreement) in its capacity as general partner, as the case may be.

“Tax” means 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.

“Third Lien Exchangeable Notes” means the Company’s 12.000% Third Lien Exchangeable Senior Secured PIK Notes due 2027.

“Third Lien Exchangeable Note Documents” means the Third Lien Exchangeable Notes Indenture, the Third Lien Exchangeable Notes, the Third Lien Exchangeable Note Guarantees, the Third Priority Lien Security Documents and the First Lien/Second Lien/Third Lien Intercreditor Agreement.

“Third Lien Exchangeable Note Guarantees” means, individually, any Guarantee of payment of the Third Lien Exchangeable Notes and the Company’s other Obligations under the Third Lien Exchangeable Indenture by a Guarantor pursuant to the terms of the Third Lien Exchangeable Indenture and any supplemental indenture thereto, and, collectively, all such Guarantees.

“Third Lien Indenture” means that certain Third Lien Senior Secured PIK Notes Indenture, dated as of May 5, 2023, by and among the Company, the Co-Obligor, the guarantors listed therein and U.S. Bank Trust Company, National Association, as trustee and collateral agent, as amended, supplemented, restated or otherwise modified from time to time, relating to the Third Lien Notes.

“Third Lien Note Documents” means the Third Lien Notes Indenture, the Third Lien Notes, the Third Lien Note Guarantees, the Third Priority Lien Security Documents and the First Lien/Second Lien/Third Lien Intercreditor Agreement.

 

46

“Third Lien Note Guarantees” means, individually, any Guarantee of payment of the Third Lien Notes and the Company’s other Obligations under the Third Lien Indenture by a Guarantor pursuant to the terms of the Third Lien Indenture and any supplemental indenture thereto, and, collectively, all such Guarantees.

“Third Lien Notes” means the Company’s 12.000% Third Lien Senior Secured PIK Notes due 2027 issued pursuant to the Third Lien Indenture.

“Third Party Investor” means the initial purchaser of the Series III First Lien Notes and its Affiliates (excluding, for the avoidance of doubt, WeWork Inc. and its Subsidiaries) or any of their successors or assigns.

“Third Party Investor Purchase Agreement” means that certain Securities Purchase and Commitment Agreement, dated as of March 17, 2023, by and among WeWork Inc., the Company, Co-Obligor and the investor party thereto.

“Third Priority Lien” means the Liens on the Collateral securing the Third Priority Lien Debt pursuant to the Third Priority Lien Documents.

“Third Priority Lien Collateral Agency Agreement” means the collateral agency agreement with respect to the Third Lien Notes among the Company, the Guarantors, the Third Priority Lien Collateral Agent, the Third Priority Lien Trustee, and the other Third Priority Lien Representatives from time to time party thereto.

“Third Priority Lien Collateral Agent” means the collateral agent under the Third Lien Notes and the Third Lien Exchangeable Notes.

“Third Priority Lien Debt” means:

(1) the Third Lien Notes issued on the Issue Date and Third Lien Note Guarantees thereof;

(2) the Third Lien Exchangeable Notes and Third Lien Exchangeable Note Guarantees thereof; and

(3) any other Indebtedness (other than intercompany Indebtedness owing to the Company or its Subsidiaries) of the Company or any Guarantor that is (i) secured equally and ratably with the Third Lien Notes or any other Third Priority Lien Debt by a Third Priority Lien, (ii) permitted to be Incurred and so secured under Section 4.09 and Section 4.10, (iii) permitted to be Incurred and so secured under each applicable Parity Lien Document, Third Priority Lien Document, Third Priority Lien Document and Junior Lien Document, and (iv) has a final maturity equal to or later than, and a weighted Average Life to Stated Maturity equal to or greater than, the final maturity of the Third Lien Notes; provided that, in the case of any Indebtedness referred to in clause (3) of this definition:

 

(a)

on or before the date on which such Indebtedness is Incurred by the Company or any Guarantor, such Indebtedness is designated by the Company, in an officers’ certificate delivered to each Third Priority Lien Representative and the Third Priority Lien Collateral Agent, as “Third Priority Lien Debt” for the purposes of the Third Lien Indenture and the Third Priority Lien Collateral Agency Agreement; provided, further, that no Series of Secured Debt may be designated as “Parity Lien Debt” and “Second Priority Lien Debt” or “Third Priority Lien Debt” or “Junior Lien Debt” (or any combination of the four);

 

47

(b)

the Third Priority Lien Representative of such Third Priority Lien Debt shall have executed and delivered an Additional Secured Debt Designation (as defined in the Third Priority Lien Collateral Agency Agreement) on behalf of itself and all holders of such Indebtedness; and

 

(c)

all requirements set forth in the Third Priority Lien Collateral Agency Agreement as to the confirmation, grant or perfection of the Third Priority Lien Collateral Agent’s Liens to secure such Indebtedness or Obligations in respect thereof are satisfied (and the satisfaction of such requirements and the other provisions of this clause (3) will be conclusively established if the Company delivers to the Third Priority Lien Collateral Agent an officers’ certificate stating that such requirements and other provisions have been satisfied and that such Indebtedness is “Third Priority Lien Debt”).

“Third Priority Lien Documents” means, collectively, the Third Lien Note Documents, the Third Lien Exchangeable Note Documents and any additional indenture, supplemental indenture, credit agreement or other agreement governing each other Series of Third Priority Lien Debt and the Third Lien Security Documents (other than any security documents that do not secure Third Priority Lien Obligations).

“Third Priority Lien Obligations” means Third Priority Lien Debt and all other Obligations in respect thereof.

“Third Priority Lien Representative” means:

(1) in the case of the Third Lien Notes, the Third Priority Lien Trustee;

(2) in the case of the Third Lien Exchangeable Notes, the trustee for the Third Lien Exchangeable Notes; or

(3) in the case of any other Series of Third Priority Lien Debt, the trustee, agent or representative of the holders of such Series of Third Priority Lien Debt who (a) is appointed as a Third Priority Lien Representative (for purposes related to the administration of the applicable security documents) pursuant to the indenture, credit agreement or other agreement governing such Series of Third Priority Lien Debt, together with its successors in such capacity, and (b) has become a party to the Third Priority Lien Collateral Agency Agreement as a “Third Priority Lien Representative” by a joinder in the form required under the Third Priority Lien Collateral Agency Agreement.

“Third Priority Lien Secured Parties” means, at any time, the holders of the Third Lien Notes, the holders of the Third Lien Exchangeable Notes, Third Priority Lien Trustee, trustee of the Third Lien Exchangeable Notes and the Third Priority Lien Collateral Agent (for each of the Third Lien Notes and Third Lien Exchangeable Notes).

“Third Priority Lien Trustee” means, at any time, the trustee under the Third Lien Notes.

 

48

“Total Indebtedness” means Indebtedness consisting of Indebtedness for borrowed money, letters of credit (only to the extent of any unreimbursed drawings thereunder), debt obligations evidenced by promissory notes and similar instruments and Guarantees in respect of any of the foregoing. For the avoidance of doubt, “Total Indebtedness” shall not include Indebtedness described in clause (5) of the definition thereof or any Guarantees in respect thereof.

“Treasury Rate” means, as obtained by the Issuer, as of any redemption date, the weekly average rounded to the nearest 1/100th of a percentage point (for the most recently completed week for which such information is available as of the date that is two Business Days prior to the redemption date) (provided that in the case of calculating the Applicable Premium in connection with a satisfaction and discharge of this First Lien Indenture or a legal defeasance or covenant defeasance under this First Lien Indenture, such weekly average shall be determined for the most recently completed week for which such information is available as of the date that is two Business Days prior to the date on which funds to pay the First Lien Notes are deposited with the Trustee) of the yield to maturity as of such redemption date of United States Treasury securities with a constant maturity (as compiled and published in Selected Interest Rates (Daily) - H.15 with respect to each applicable day during such week (or, if such release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from such redemption date to November 1, 2024; provided, however, that if the period from such redemption date to November 1, 2024 is less than one year, the weekly average yield on actively traded United States Treasury securities adjusted to a constant maturity of one year will be used.

“Transaction Expenses” means any fees, costs, premium, original issue discount and expenses (including all legal, accounting and other professional fees, costs and expenses) Incurred or paid by the Company or any Restricted Subsidiary associated or in connection with the Transactions, including any fees, costs, premium, original issue discount and expenses associated with payments or distributions to dissenting stockholders (including in connection with, or as a result of, exercise of dissenters’ or appraisal rights and the settlement of any claims or action (whether actual, contingent or potential) with respect thereto).

“Transactions” means, collectively, the transactions described under “Summary––The Transactions” in the Offering Memorandum, the payment of Transaction Expenses and the consummation of any other transaction in connection with the foregoing.

“Trust Indenture Act” means the Trust Indenture Act of 1939, as amended.

“Trustee” means U.S. Bank Trust Company, National Association, a national banking association organized under the laws of the United States, as trustee, until a successor replaces it in accordance with the applicable provisions of this First Lien Indenture and thereafter means the successor serving hereunder.

“Uniform Commercial Code” means the Uniform Commercial Code as in effect from time to time in any applicable jurisdiction.

“Unrestricted Subsidiary” means (1) WeWork Capital Advisors LLC, 1 Ariel Way Tenant Limited, ARK Investment Group Holdings LLC and (2) in addition:

(a) any Subsidiary of the Company which at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors of the Company in the manner provided in Section 4.13; and

 

49

(b) any Subsidiary of an Unrestricted Subsidiary.

For the avoidance of doubt, no Subsidiary other than the Subsidiaries listed in clause (1) of this definition (and their Subsidiaries) shall be designated as an Unrestricted Subsidiary after the Issue Date without the prior written consent of the Required First Lien Noteholders.

“Unrestricted Subsidiary Asset Disposition” means (i) any direct or indirect sale, lease (other than a lease entered into in the ordinary course of business (whether or not consistent with past practice)), transfer, issuance or other disposition, or a series of related sales, leases, transfers, issuances or dispositions that are part of a common plan, of shares of Capital Stock of an Unrestricted Subsidiary or WeWork Japan GK (other than directors’ qualifying shares), property or other assets (each referred to for the purposes of this definition as a “disposition”) by any Unrestricted Subsidiary or WeWork Japan GK, including any disposition by means of a merger, consolidation or similar transaction.

Notwithstanding the preceding, the following items shall not be deemed to be an Unrestricted Subsidiary Asset Disposition:

(1) a disposition of assets by an Unrestricted Subsidiary (other than a disposition of WeWork Japan GK or any of its assets) to an Unrestricted Subsidiary;

(2) a disposition of Cash Equivalents in the ordinary course of business (whether or not consistent with past practice);

(3) a disposition of an account receivable in connection with the collection or compromise thereof in the ordinary course of business (consistent with past practice);

(4) a disposition of obsolete, surplus, damaged or worn-out assets or assets that are no longer useful in the conduct of the business of the Unrestricted Subsidiary;

(5) the sale or issuance of Capital Stock by an Unrestricted Subsidiary to the Company or to a Restricted Subsidiary;

(6) dispositions of assets in a single transaction or a series of related transactions with an aggregate Fair Market Value of less than $10.00 million;

(7) the creation of a Lien and dispositions in connection with Liens (other than, in the case of WeWork Japan GK, dispositions in connection with Liens with a Fair Market Value in excess of $10.00 million);

(8) dispositions of receivables in connection with the compromise, settlement or collection thereof in the ordinary course of business (whether or not consistent with past practice) or in bankruptcy or similar proceedings and exclusive of factoring or similar arrangements;

(9) the licensing or sublicensing of intellectual property or other general intangibles and licenses, leases or subleases of other property in the ordinary course of business (whether or not consistent with past practice) which do not materially interfere with the business of the Unrestricted Subsidiary, taken as a whole;

(10) foreclosure on, or condemnation or expropriation of, assets and the surrender or waiver of contract rights or the settlement, release or surrender of contract, tort or other claims;

 

50

(11) the unwinding of any Hedging Obligations or Cash Management Obligations;

(12) dispositions of Investments in joint ventures to the extent required by, or made pursuant to, customary buy/ sell arrangements between the joint venture parties set forth in joint venture agreements and similar binding agreements;

(13) dispositions of property consisting of tenant improvements at a location in connection with the termination of the lease for such location or cessation of operations at such location; and

(14) a disposition of assets by WeWork Japan GK or any of its subsidiaries to WeWork Japan GK or any of its other Subsidiaries.

“Voting Stock” of a Person means all classes of Capital Stock of such Person then outstanding and normally entitled to vote in the election of directors, managers or trustees, as applicable, of such Person.

“WeWork Inc.” means WeWork Inc., a Delaware corporation, and its successors and assigns.

“Wholly Owned Subsidiary” means a Restricted Subsidiary, all of the Capital Stock of which (other than directors’ qualifying shares) is owned by the Company or another Wholly Owned Subsidiary.

Section 1.02. Other Definitions.

 

Term		Defined in Section
“4(a)(2) Global Note”		2.1(b) of Appendix A
“4(a)(2) Notes”		2.1(a) of Appendix A
“Additional Offered Debt”		9.02(h)
“Affiliate Transaction”		4.14(a)
“Agent Members”		2.1(c) of Appendix A
“Applicable Procedures”		1.1(a) of Appendix A
“Asset Disposition Offer”		4.16(c)
“Asset Disposition Offer Amount”		Section 3.09(b)
“Asset Disposition Offer Period”		Section 3.09(b)
“Asset Disposition Purchase Date”		Section 3.09(b)
“Authentication Order”		2.02(c)
“Automatic Exchange”		2.2(i) of Appendix A
“Automatic Exchange Date”		2.2(i) of Appendix A
“Automatic Exchange Notice”		2.2(i) of Appendix A
“Automatic Exchange Notice Date”		2.2(i) of Appendix A
“balance sheet date”		4.06(f)
“Change of Control Offer”		4.15(a)
“Change of Control Payment”		4.15(a)
“Change of Control Payment Date”		4.15(b)
“Clearstream”		1.1(a) of Appendix A
“Covenant Defeasance”		8.03
“Definitive Notes Legend”		2.2(e) of Appendix A

 

51

Term		Defined in Section
“Designation”		4.13(a)
“Directing Holder”		6.01(b)
“Distribution Compliance Period”		1.1(a) of Appendix A
“ERISA Legend”		2.2(e) of Appendix A
“Euroclear”		1.1(a) of Appendix A
“Event of Default”		6.01(a)
“Excess Proceeds”		4.16(c)
“Existing Bank Facility Debt”		4.09(c)
“Expiration Date”		Section 1.04(j)
“First Lien Notes Cap”		4.09(b)
“First Lien Note Register”		2.03(a)
“Fully Participating Holder”		9.02(h)
“Global Note”		2.1(b) of Appendix A
“Global Notes Legend”		2.2(e) of Appendix A
“Guaranteed Obligations”		10.01(a)
“IAI”		1.1(a) of Appendix A
“IAI Global Note”		2.1(b) of Appendix A
“ICA Legend”		2.2(e) of Appendix A
“Legal Defeasance”		8.02(a)
“Noteholder Direction”		6.01(b)
“Notice”		13.13
“OID Notes Legend”		2.2(e) of Appendix A
“Offer Notice”		9.02(h)
“Participating Acceptance”		9.02(h)
“Participating Acceptance Deadline”		9.02(h)
“Paying Agent”		2.03(a)
“PDF”		13.15
“PIK Notes”		2.01(b)
“Position Representation”		6.01(b)
“QIB”		1.1(a) of Appendix A
“Registrar”		2.03(a)
“Regulation S”		1.1(a) of Appendix A
“Regulation S Global Note”		2.1(b) of Appendix A
“Regulation S Notes”		2.1(a) of Appendix A
“Restricted Notes Legend”		2.2(e) of Appendix A
“Restricted Payment”		Section 4.08(a)
“Revocation”		4.13(a)
“Rule 144”		1.1(a) of Appendix A
“Rule 144A”		1.1(a) of Appendix A
“Rule 144A Global Note”		2.1(b) of Appendix A
“Rule 144A Notes”		2.1(a) of Appendix A
“Specified Courts”		13.07
“Successor Company”		5.01(d)
“Successor Guarantor”		5.01(f)
“Successor Parent”		5.01(a)
“Top-Up Notice”		9.02(h)

 

52

Term		Defined in Section
“Trustee”		7.07(f)
“Unrestricted Global Note”		1.1(a) of Appendix A
“Unrestricted Subsidiary”		4.13(a)
“Verification Covenant”		6.01(b)

Section 1.03. Rules of Construction.

Unless the context otherwise requires:

(1) a term defined in Section 1.01 or Section 1.02 has the meaning assigned to it therein;

(2) an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;

(3) “or” is not exclusive;

(4) words in the singular include the plural, and words in the plural include the singular;

(5) provisions apply to successive events and transactions;

(6) unless the context otherwise requires, any reference to an “Appendix,” “Article,” “Section,” “clause,” “Schedule” or “Exhibit” refers to an Appendix, Article, Section, clause, Schedule or Exhibit, as the case may be, of this First Lien Indenture;

(7) the words “herein,” “hereof” and other words of similar import refer to this First Lien Indenture as a whole and not any particular Article, Section, clause or other subdivision;

(8) “including” means including without limitation;

(9) references to sections of, or rules under, the Securities Act, the Exchange Act or the Trust Indenture Act shall be deemed to include substitute, replacement or successor sections or rules adopted by the SEC from time to time;

(10) unless otherwise provided, references to agreements and other instruments shall be deemed to include all amendments and other modifications to such agreements or instruments, but only to the extent such amendments and other modifications are not prohibited by the terms of this First Lien Indenture; and

(11) in the event that a transaction meets the criteria of more than one category of permitted transactions or listed exceptions, the Company may classify such transaction as it, in its sole discretion, determines;

(12) references to “principal amount” of First Lien Notes include any increase in the principal amount of outstanding First Lien Notes (including as a result of a PIK Payment).

 

53

Section 1.04. Acts of Holders.

(a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this First Lien Indenture to be given or taken by Holders of any Series of First Lien Notes may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing. Except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments or record or both are delivered to the Trustee and, where it is hereby expressly required, to the Company and the Guarantors. Proof of execution of any such instrument or of a writing appointing any such agent, or the holding by any Person of a First Lien Note, shall be sufficient for any purpose of this First Lien Indenture and (subject to Section 7.01) conclusive in favor of the Trustee, the Company and the Guarantors, if made in the manner provided in this Section 1.04.

(b) The fact and date of the execution by any Person of any such instrument or writing may be proved (1) by the affidavit of a witness of such execution or by the certificate of any notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof or (2) in any other manner deemed reasonably sufficient by the Trustee. Where such execution is by or on behalf of any legal entity other than an individual, such certificate or affidavit shall also constitute proof of the authority of the Person executing the same. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner that the Trustee deems sufficient.

(c) The ownership of any First Lien Notes shall be proved by the First Lien Note Register.

(d) Any request, demand, authorization, direction, notice, consent, waiver or other action by a Holder of any Series of First Lien Notes shall bind every future Holder of the same First Lien Note and the Holder of every First Lien Note issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof, in respect of any action taken, suffered or omitted by the Trustee, the Company or the Guarantors in reliance thereon, whether or not notation of such action is made upon such First Lien Note.

(e) The Company may set a record date for purposes of determining the identity of Holders of any Series of First Lien Notes entitled to make, give or take any request, demand, authorization, direction, notice, consent, waiver or other action provided in this First Lien Indenture to be made, or to vote on or consent to any action authorized or permitted to be taken by such Holders; provided that the Company may also choose not to set a record date for, and the provisions of this clause (e) shall not apply with respect to, the giving or making of any notice, declaration, request or direction referred to in clause (f) below. Unless otherwise specified, if not set by the Company prior to the first solicitation of a Holder made by any Person in respect of any such action, or in the case of any such vote, prior to such vote, any such record date shall be the later of 30 days prior to the first solicitation of such consent or vote or the date of the most recent list of Holders furnished to the Trustee prior to such solicitation or vote. If any record date is set pursuant to this clause (e), the Holders of the relevant Series of First Lien Notes on such record date, and only such Holders, shall be entitled to make, give or take such request, demand, authorization, direction, notice, consent, waiver or other action (including revocation of any action), whether or not such Holders remain Holders of a Series of First Lien Notes after such record date; provided that no such action shall be effective hereunder unless made, given or taken on or prior to the applicable Expiration Date by Holders of the requisite principal amount of the

 

54

relevant Series of First Lien Notes, or each affected Holder of such Series of First Lien Notes, as applicable, on such record date. Promptly after any record date is set pursuant to this clause (e), the Company, at its own expense, shall cause notice of such record date, the proposed action by Holders and the applicable Expiration Date to be given to the Trustee in writing and to each Holder of such Series of First Lien Notes in the manner set forth in Section 13.01.

(f) The Trustee or the Company may set any day as a record date for the purpose of determining the Holders of any Series of First Lien Notes entitled to join in the giving or making of (1) any notice of default under Section 6.01(a), (2) any declaration of acceleration referred to in Section 6.02, (3) any direction referred to in Section 6.05 or (4) any request to pursue a remedy as permitted in Section 6.06. If any record date is set pursuant to this clause (f), the Holders of the relevant Series of First Lien Notes on such record date, and no other Holders, shall be entitled to join in such notice, declaration, request or direction, whether or not such Holders remain Holders after such record date; provided that no such action shall be effective hereunder unless made, given or taken on or prior to the applicable Expiration Date by Holders of the requisite principal amount of the relevant Series of First Lien Notes or each affected Holder of such Series of First Lien Notes, as applicable, on such record date. Promptly after any record date is set pursuant to this clause (f), the Trustee, at the Company’s expense, shall cause notice of such record date, the proposed action by Holders and the applicable Expiration Date to be given to the Company and to each Holder of the relevant Series of First Lien Notes, as applicable, in the manner set forth in Section 13.01.

(g) Without limiting the foregoing, a Holder entitled to take any action hereunder with regard to any particular First Lien Note may do so with regard to all or any part of the principal amount of such First Lien Note or by one or more duly appointed agents, each of which may do so pursuant to such appointment with regard to all or any part of such principal amount. Any notice given or action taken by a Holder or its agents with regard to different parts of such principal amount pursuant to this clause (g) shall have the same effect as if given or taken by separate Holders of each such different part.

(h) Without limiting the generality of the foregoing, a Holder, including a Depositary that is the Holder of a Global Note, may make, give or take, by a proxy or proxies duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver or other action provided in this First Lien Indenture to be made, given or taken by Holders, and a Depositary that is the Holder of a Global Note may provide its proxy or proxies to the beneficial owners of interests in any such Global Note through such Depositary’s standing instructions and customary practices.

(i) The Company may fix a record date for the purpose of determining the Persons who are beneficial owners of interests in any Global Note held by a Depositary entitled under the procedures of such Depositary, if any, to make, give or take, by a proxy or proxies duly appointed in writing, any request, demand, authorization, direction, notice, consent, waiver or other action provided in this First Lien Indenture to be made, given or taken by Holders; provided that if such a record date is fixed, only the beneficial owners of interests in such Global Note on such record date or their duly appointed proxy or proxies shall be entitled to make, give or take such request, demand, authorization, direction, notice, consent, waiver or other action, whether or not such beneficial owners remain beneficial owners of interests in such Global Note after such record date. No such request, demand, authorization, direction, notice, consent, waiver or other action shall be effective hereunder unless made, given or taken on or prior to the applicable Expiration Date.

 

55

(j) With respect to any record date set pursuant to this Section 1.04, the party hereto that sets such record date may designate any day as the “Expiration Date” and from time to time may change the Expiration Date to any earlier or later day; provided that no such change shall be effective unless notice of the proposed new Expiration Date is given to the other party hereto in writing, and to each Holder of the relevant Series of First Lien Notes in the manner set forth in Section 13.01, on or prior to both the existing and the new Expiration Date. If an Expiration Date is not designated with respect to any record date set pursuant to this Section 1.04, the party hereto which set such record date shall be deemed to have initially designated the 90th day after such record date as the Expiration Date with respect thereto, subject to its right to change the Expiration Date as provided in this clause (j).

Section 1.05. No Incorporation by Reference of Trust Indenture Act.

This First Lien Indenture is not qualified under the Trust Indenture Act, and the Trust Indenture Act shall not apply to or in any way govern the terms of this First Lien Indenture. As a result, no provisions of the Trust Indenture Act are incorporated into this First Lien Indenture unless expressly incorporated pursuant to this First Lien Indenture.

ARTICLE 2

The First Lien Notes

Section 2.01. Form and Dating; Terms.

(a) Provisions relating to the Initial Notes, PIK Notes and any other First Lien Notes issued under this First Lien Indenture are set forth in Appendix A, which is hereby incorporated in and expressly made a part of this First Lien Indenture. The First Lien Notes and the Trustee’s certificate of authentication shall each be substantially in the form of Exhibit A hereto (appropriately completed to reflect whether the applicable First Lien Notes is a Series I First Lien Note, a Series II First Lien Note or a Series III First Lien Note), which is hereby incorporated in and expressly made a part of this First Lien Indenture. The First Lien Notes may have notations, legends or endorsements required by law, rules or agreements with national securities exchanges to which the Company, the Co-Obligor or any Guarantor is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Company). Each First Lien Note shall be dated the date of its authentication. The First Lien Notes shall be in minimum denominations of $1.00 and integral multiples of $1.00 in excess thereof.

(b) The aggregate principal amount of First Lien Notes that may be authenticated and delivered under this First Lien Indenture shall not exceed the First Lien Notes Cap.

The terms and provisions contained in the First Lien Notes shall constitute, and are hereby expressly made, a part of this First Lien Indenture, and the Company, the Co-Obligor, the Guarantors, the Trustee and the Collateral Agent, by their execution and delivery of this First Lien Indenture, expressly agree to such terms and provisions and to be bound thereby. However, to the extent any provision of any First Lien Note conflicts with the express provisions of this First Lien Indenture, the provisions of this First Lien Indenture shall govern and be controlling.

 

56

The First Lien Notes shall be subject to repurchase by the Company pursuant to an Asset Disposition Offer as provided in Section 4.16 or a Change of Control Offer as provided in Section 4.15, and otherwise as not prohibited by this First Lien Indenture. The First Lien Notes shall not be redeemable, other than as provided in Article 3.

In connection with any PIK Payment, the Company is entitled, without the consent of the Holders (and without regard to any restrictions or limitations set forth under Sections 4.09 and 4.10), to increase the aggregate principal amount of an outstanding Global Note or to issue Global Notes or Definitive Notes under this First Lien Indenture having the same terms as the Initial Notes of the applicable Series of First Lien Notes, subject to the terms of Exhibit A, in the amount of the applicable PIK Payment (“PIK Notes”). PIK Notes shall be consolidated with and form a single class with the Initial Notes of the applicable Series of First Lien Notes and shall have the same terms as to status, redemption or otherwise (other than issue date, issue price and, if applicable, the first interest payment date and the first date from which interest will accrue) as the Initial Notes of the applicable Series of First Lien Notes.

Section 2.02. Execution and Authentication.

(a) At least one Officer shall execute the First Lien Notes on behalf of the Company by manual or facsimile signature. If an Officer whose signature is on a First Lien Note no longer holds that office at the time a First Lien Note is authenticated, the First Lien Note shall nevertheless be valid.

(b) A First Lien Note shall not be entitled to any benefit under this First Lien Indenture or be valid or obligatory for any purpose until authenticated substantially in the form of Exhibit A attached hereto by the manual signature of an authorized signatory of the Trustee. The signature shall be conclusive evidence that the First Lien Note has been duly authenticated and delivered under this First Lien Indenture.

(c) On the Issue Date, the Trustee shall, upon receipt of a written order of the Company signed by an Officer (an “Authentication Order”), authenticate and deliver the Initial Series I Notes. In addition, at any time and from time to time, the Trustee shall, upon receipt (i) of an Authentication Order, authenticate and deliver any Series II Notes, Series III Notes and PIK Notes, as applicable, in each case in an aggregate principal amount specified in such Authentication Order for such Series II First Lien Notes, Series III First Lien Notes and PIK Notes, as applicable, issued hereunder or (ii) a written order of the Company, increase the aggregate principal amount of an outstanding Global Note as a result of a PIK Payment in the amount set forth in such order.

(d) The Trustee may appoint an authenticating agent acceptable to the Company to authenticate First Lien Notes. An authenticating agent may authenticate First Lien Notes whenever the Trustee may do so. Each reference in this First Lien Indenture to authentication by the Trustee includes authentication by such agent. An authenticating agent has the same rights as an Agent to deal with Holders, the Company or an Affiliate of the Company.

(e) The Trustee shall authenticate and make available for delivery upon a written order of the Company signed by one Officer of the Company (a) Initial Series I Notes for original issue on the Issue Date in an aggregate principal amount of $525,000,000, (b) subject to the terms of this First Lien Indenture, Series II First Lien Notes, Series III First Lien Notes and PIK Notes, as applicable, (c) any Unrestricted Global Notes issued in exchange for any of the foregoing in accordance with this First Lien Indenture. Such order shall specify the amount of the First Lien Notes to be authenticated, the date on which the original issue of First Lien Notes is to be authenticated and whether the First Lien Notes are to be Initial Notes, PIK Notes or other Unrestricted Global Notes. Notwithstanding anything to the contrary herein, only an Authentication Order shall be delivered to the Trustee and no Officer’s Certificate or Opinion of Counsel shall be required to be delivered in connection with any PIK Payment (whether by an issuance of PIK Notes or by an increase in the aggregate principal amount of an outstanding Global Note as a result of a PIK Payment).

 

57

Section 2.03. Registrar and Paying Agent.

(a) The Company shall maintain an office or agency where First Lien Notes may be presented for registration of transfer or for exchange (“Registrar”) and at least one office or agency where First Lien Notes may be presented for payment (“Paying Agent”). The Registrar shall keep a register of the First Lien Notes (“First Lien Note Register”) and of their transfer and exchange. The Company may appoint one or more co-registrars and one or more additional paying agents. The term “Registrar” includes any co-registrar, and the term “Paying Agent” includes any additional paying agent. The Company may change any Paying Agent or Registrar without prior notice to any Holder. The Company shall notify the Trustee in writing of the name and address of any Agent not a party to this First Lien Indenture. If the Company fails to appoint or maintain another entity as Registrar or Paying Agent, the Trustee shall act as such. The Company or any of its Subsidiaries may act as Paying Agent or Registrar.

(b) The Company initially appoints DTC to act as Depositary with respect to the Global Notes. The Company initially appoints the Trustee to act as Paying Agent and Registrar for the First Lien Notes and to act as Custodian with respect to the Global Notes.

Section 2.04. Paying Agent to Hold Money and PIK Notes in Trust.

The Company shall, no later than 11:00 a.m. (New York City time) on each due date for the payment of principal of, premium, if any, and interest on any of the First Lien Notes, deposit with a Paying Agent cash and, if applicable, PIK Notes sufficient to pay such amount, such cash and, if applicable, PIK Notes to be held in trust for the Holders entitled to the same, and (unless such Paying Agent is the Trustee) the Company shall promptly notify the Trustee of its action or failure so to act. The Company shall require each Paying Agent other than the Trustee to agree in writing that such Paying Agent shall hold in trust for the benefit of Holders or the Trustee all cash or PIK Notes held by such Paying Agent for the payment of principal of, premium, if any, and interest on, the First Lien Notes, and shall notify the Trustee of any default by the Company in making any such payment. While any such default continues, the Trustee may require a Paying Agent to pay all cash, or deliver all PIK Notes, held by it to the Trustee. The Company at any time may require a Paying Agent to pay all cash, or deliver all PIK Notes, held by it to the Trustee. Upon payment over, or delivery, to the Trustee, a Paying Agent shall have no further liability for the cash or PIK Notes, as the case may be. If the Company or a Subsidiary acts as Paying Agent, it shall segregate and hold in a separate trust fund for the benefit of the Holders all cash held by it as Paying Agent. Upon any bankruptcy or reorganization proceedings relating to the Company, the Trustee shall serve as Paying Agent for the First Lien Notes. Notwithstanding anything in this First Lien Indenture to the contrary, any PIK Payment in the form of an increase in the aggregate principal amount of an outstanding Global Note made in accordance with Section 4.01 shall be deemed to comply with this Section 2.04.

Section 2.05. Holder Lists.

The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of all Holders. If the Trustee is not the Registrar, the Company shall furnish to the Trustee at least two Business Days before each Interest Payment Date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of the Holders.

 

58

Section 2.06. Transfer and Exchange.

(a) The First Lien Notes shall be issued in registered form and shall be transferable only upon the surrender of a First Lien Note for registration of transfer and in compliance with Appendix A.

(b) To permit registrations of transfers and exchanges, the Company shall execute and the Trustee shall authenticate Global Notes and Definitive Notes upon receipt of an Authentication Order in accordance with Section 2.02 or at the Registrar’s request.

(c) No service charge shall be imposed in connection with any registration of transfer or exchange (other than pursuant to Section 2.07), but the Holders shall be required to pay any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 2.10, 3.06, 3.09, 4.15, 4.16 and 9.04).

(d) All Global Notes and Definitive Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Notes shall be the valid obligations of the Company and Co-Obligor, evidencing the same debt, and entitled to the same benefits under this First Lien Indenture, as the Global Notes or Definitive Notes surrendered upon such registration of transfer or exchange.

(e) Neither the Company nor the Registrar shall be required (1) to issue, to register the transfer of or to exchange any First Lien Note during a period beginning at the opening of business 15 days before the day of any selection of First Lien Notes for redemption under Section 3.02 and ending at the close of business on the day of selection, (2) to register the transfer of or to exchange any First Lien Note so selected for redemption, or tendered for repurchase (and not withdrawn) in connection with a Change of Control Offer or an Asset Disposition Offer, in whole or in part, except the unredeemed or unpurchased portion of any First Lien Note being redeemed or repurchased in part or (3) to register the transfer of or to exchange any First Lien Note between a Record Date and the next succeeding Interest Payment Date.

(f) Prior to due presentment for the registration of a transfer of any First Lien Note, the Trustee, any Agent and the Company shall deem and treat the Person in whose name any First Lien Note is registered as the absolute owner of such First Lien Note for the purpose of receiving payment of principal of, premium, if any, and (subject to the Record Date provisions of the First Lien Notes) interest on such First Lien Notes and for all other purposes, and none of the Trustee, any Agent or the Company shall be affected by notice to the contrary.

(g) Upon surrender for registration of transfer of any First Lien Note at the office or agency of the Company designated pursuant to Section 4.02, the Company shall execute, and the Trustee shall authenticate and mail, in the name of the designated transferee or transferees, one or more replacement First Lien Notes of any authorized denomination or denominations of a like aggregate principal amount.

 

59

(h) At the option of the Holder, First Lien Notes may be exchanged for other First Lien Notes from the same Series of First Lien Notes of any authorized denomination or denominations of a like aggregate principal amount upon surrender of the First Lien Notes to be exchanged at such office or agency. Whenever any Global Notes or Definitive Notes are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and mail, the replacement Global Notes and Definitive Notes which the Holder making the exchange is entitled to in accordance with the provisions of Appendix A.

(i) All certifications, certificates and Opinions of Counsel required to be submitted to the Registrar pursuant to this Section 2.06 to effect a registration of transfer or exchange may be submitted by mail or by facsimile or electronic transmission.

Section 2.07. Replacement First Lien Notes.

If a mutilated First Lien Note is surrendered to the Trustee or if a Holder claims that its First Lien Note has been lost, destroyed or wrongfully taken and the Trustee receives evidence to its satisfaction of the ownership and loss, destruction or theft of such First Lien Note, the Company shall issue and the Trustee, upon receipt of an Authentication Order, shall authenticate a replacement First Lien Note of the same Series of First Lien Notes if the Trustee’s requirements are otherwise met. If required by the Trustee or the Company, indemnity or security must be provided by the Holder that is sufficient in the judgment of the Trustee and the Company to protect the Company, the Trustee, any Agent and any authenticating agent from any loss that any of them may suffer if a First Lien Note is replaced. The Company may charge the Holder for the expenses of the Company and the Trustee in replacing a First Lien Note. Every replacement First Lien Note is a contractual obligation of the Company and shall be entitled to all of the benefits of this First Lien Indenture equally and proportionately with all other First Lien Notes of the same Series of First Lien Notes duly issued hereunder. Notwithstanding the foregoing provisions of this Section 2.07, in case any mutilated, lost, destroyed or wrongfully taken First Lien Note has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new First Lien Note, pay such First Lien Note.

Section 2.08. Outstanding First Lien Notes.

(a) The First Lien Notes outstanding at any time are all the First Lien Notes authenticated by the Trustee except for those canceled by it, those delivered to it for cancellation, those reductions in the interest in a Global Note effected by the Trustee in accordance with the provisions hereof, and those described in this Section 2.08 as not outstanding. Except as set forth in Section 2.09, a First Lien Note does not cease to be outstanding because the Company or an Affiliate of the Company holds the First Lien Note; provided that First Lien Notes held by the Company or a Subsidiary of the Company shall not be deemed to be outstanding for purposes of Section 3.07(b).

(b) If a First Lien Note is replaced pursuant to Section 2.07, it ceases to be outstanding unless the Trustee receives proof satisfactory to it that the replaced First Lien Note is held by a protected purchaser, as such term is defined in Section 8-303 of the Uniform Commercial Code in effect in the State of New York.

(c) If the principal amount of any First Lien Note is considered paid under Section 4.01, it ceases to be outstanding and interest on it ceases to accrue from and after the date of such payment.

(d) If a Paying Agent (other than the Company, a Subsidiary or an Affiliate of any thereof) holds, on the maturity date, any redemption date or any date of purchase pursuant to an Offer to Purchase, money sufficient to pay First Lien Notes payable or to be redeemed or purchased on that date, then on and after that date such First Lien Notes shall be deemed to be no longer outstanding and shall cease to accrue interest.

 

60

(e) For the avoidance of doubt, unless represented by PIK Notes, the aggregate principal amount outstanding under any First Lien Note (as reflected in the books and records of the Depositary and the Trustee) shall include any increase in the aggregate principal amount of the applicable Global Notes as a result of a PIK Payment.

Section 2.09. Treasury Notes.

In determining whether the Holders of the requisite principal amount of the applicable Series of First Lien Notes have concurred in any direction, waiver or consent, First Lien Notes of the applicable Series beneficially owned by the Company (or, in the case of Series I First Lien Notes, by any Affiliate of the Company) shall be considered as though not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only First Lien Notes of the applicable Series that a Responsible Officer of the Trustee knows are so owned shall be so disregarded. First Lien Notes of a Series so owned which have been pledged in good faith shall not be disregarded if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right to deliver any such direction, waiver or consent with respect to such First Lien Notes of the applicable Series and that the pledgee is not the Company or any obligor upon such First Lien Notes of the applicable Series (or, in the case of Series I First Lien Notes, any Affiliate of the Company or of such other obligor).

Section 2.10. Temporary First Lien Notes.

Until Definitive Notes are ready for delivery, the Company may prepare and the Trustee, upon receipt of an Authentication Order, shall authenticate temporary First Lien Notes. Temporary First Lien Notes shall be substantially in the form of Definitive Notes but may have variations that the Company considers appropriate for temporary First Lien Notes and as shall be reasonably acceptable to the Trustee. Without unreasonable delay, the Company shall prepare and the Trustee shall authenticate Definitive Notes in exchange for temporary First Lien Notes. Holders and beneficial holders, as the case may be, of temporary First Lien Notes shall be entitled to all of the benefits accorded to Holders, or beneficial holders, respectively, of First Lien Notes under this First Lien Indenture.

Section 2.11. Cancellation.

The Company at any time may deliver First Lien Notes to the Trustee for cancellation. The Registrar and Paying Agent shall forward to the Trustee any First Lien Notes surrendered to them for registration of transfer, exchange or payment. The Trustee or, at the direction of the Trustee, the Registrar or the Paying Agent and no one else shall cancel all First Lien Notes surrendered for registration of transfer, exchange, payment, replacement or cancellation and shall destroy cancelled First Lien Notes in accordance with its customary procedures (subject to the record retention requirement of the Exchange Act). Certification of the destruction of all cancelled First Lien Notes shall, upon the written request of the Company, be delivered to the Company. Except as provided in this First Lien Indenture, the Company may not issue new First Lien Notes to replace First Lien Notes that it has paid or that have been delivered to the Trustee for cancellation.

 

61

Section 2.12. Defaulted Interest.

(a) If the Company defaults in a payment of interest on the First Lien Notes, it shall pay the defaulted interest in any lawful manner plus, to the extent lawful, interest payable on the defaulted interest, to the Persons who are Holders on a subsequent special record date, in each case at the rate provided in the First Lien Notes and in Section 4.01. The Company shall notify the Trustee in writing of the amount of defaulted interest proposed to be paid on each First Lien Note and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such defaulted interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such defaulted interest as provided in this Section 2.12. The Trustee shall fix or cause to be fixed each such special record date and payment date; provided that no such special record date shall be less than 10 days prior to the related payment date for such defaulted interest. The Trustee shall promptly notify the Company of such special record date. At least 15 days before the special record date, the Company (or, upon the written request of the Company, the Trustee in the name and at the expense of the Company) shall mail or deliver by electronic transmission in accordance with the applicable procedures of the Depositary, or cause to be mailed or delivered by electronic transmission in accordance with the applicable procedures of the Depositary to each Holder a notice that states the special record date, the related payment date and the amount of such interest to be paid.

(b) Subject to the foregoing provisions of this Section 2.12 and for greater certainty, each First Lien Note delivered under this First Lien Indenture upon registration of transfer of or in exchange for or in lieu of any other First Lien Note shall carry the rights to interest accrued and unpaid, and to accrue interest, which were carried by such other First Lien Note so delivered.

Section 2.13. CUSIP and ISIN Numbers.

The Company may use CUSIP or ISIN numbers (if then generally in use) for First Lien Notes of any Series and, if so, the Trustee shall use CUSIP or ISIN numbers in notices of redemption or exchange or in Offers to Purchase for such Series of First Lien Notes as a convenience to Holders; provided that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the First Lien Notes of the applicable Series or as contained in any notice of redemption or exchange or in Offers to Purchase and that reliance may be placed only on the other identification numbers printed on the First Lien Notes of the applicable Series, and any such redemption or exchange or Offer to Purchase shall not be affected by any defect in or omission of such numbers. The Company shall as promptly as practicable notify the Trustee in writing of any change in the CUSIP or ISIN numbers for First Lien Notes of any Series.

Section 2.14. PIK Interest.

As further set forth in Sections 1 and 2 of Exhibit A, interest on the First Lien Notes shall be partially payable in the form of PIK Interest on the then-outstanding principal amount of First Lien Notes. In connection with a PIK Payment in respect of the First Lien Notes, the Company will, without the consent of Holders (and without regard to any restrictions or limitations set forth under Sections 4.09 and 4.10), either increase the aggregate principal amount of an outstanding Global Note or issue PIK Notes under this First Lien Indenture. Pursuant to this Section 2.14 and Section 1 of Exhibit A, and as further set forth in Section 4.01 and Section 2 of Exhibit A, on the applicable Record Date, the Company shall deliver to the Trustee (i) a written order of the Company to increase the aggregate principal amount of an outstanding Global Note as a result of such PIK Payment in the amount set forth in such order or (ii) PIK Notes duly executed by the

 

62

Company together with an Authentication Order pursuant to Section 2.02 requesting the authentication of such PIK Notes by the Trustee. On any Interest Payment Date on which the Company makes a PIK Payment by increasing the aggregate principal amount of an outstanding Global Note, the Trustee, or the Depositary at the direction of the Trustee, shall increase the outstanding aggregate principal amount of such Global Note by an amount equal to the PIK Interest payable, rounded down to the nearest whole dollar, for the relevant interest period on the principal amount of such Global Note, to the credit of the Holders on the relevant Record Date and an adjustment will be made on the register maintained with the Registrar with respect to such Global Note to reflect such increase and thereafter shall be part of the outstanding principal amount of the First Lien Notes for all purposes of this First Lien Indenture, the Security Documents and the First Lien/Second Lien/Third Lien Intercreditor Agreement. On any Interest Payment Date on which the Company makes a PIK Payment by issuing PIK Notes, the principal amount of such PIK Notes issued to any Holder, for the relevant interest period as of the relevant Record Date for such Interest Payment Date, will be rounded down to the nearest whole dollar. For the avoidance of doubt, following the increase in the aggregate principal amount of any outstanding Global Note as a result of a PIK Payment, such Global Note will bear interest on such increased aggregate principal amount from and after the date of such PIK Payment at the rate applicable to the First Lien Notes in the manner set forth on Exhibit A. Any PIK Notes issued in the form of Definitive Notes will be dated as of the applicable Interest Payment Date and will bear interest from and after such date at the rate applicable to the First Lien Notes in the manner set forth on Exhibit A. All First Lien Notes issued pursuant to a PIK Payment will mature on August 15, 2027 and will be governed by, and subject to the terms, provisions and conditions of, this First Lien Indenture and shall have the same terms as the applicable Initial Notes, subject to the terms of Exhibit A. Any certificated PIK Notes will be issued with the description “THIS IS A PIK NOTE” on the face of such PIK Note, but shall be treated for all purposes under this First Lien Indenture with the same rights and obligations as the First Lien Notes.

Section 2.15. Series II and Series III First Lien Notes.

(a) On or subsequent to the Issue Date, the Issuers may issue Series II First Lien Notes and Series III First Lien Notes in an aggregate principal amount, together with the Series I First Lien Notes issued on the Issue Date, not to exceed the First Lien Notes Cap. The terms of each Series of First Lien Notes shall be substantially identical, except that:

(i) holders of each Series of First Lien Notes shall vote separately with respect to any future amendment, waiver, consent or other modification of this First Lien Indenture, or any other action by holders or exercise of remedies affecting the series held by them; and

(ii) in determining whether the holders of the requisite principal amount of each Series of First Lien Notes have concurred in any direction, waiver or consent, the First Lien Notes of such series beneficially owned by the Company or any Affiliate of the Company (other than SBG) shall be considered as though not outstanding.

(b) In accordance with the terms of this First Lien Indenture, Holders of:

(i) any Series II First Lien Note shall exchange each such Series II First Lien Note into a Series I First Lien Note in connection with the transfer, disposition or sale by SBG of such Series II First Lien Note to a third party that is not an Affiliate of the Company, provided that, no such exchange of Series II First Lien Notes into Series I First Lien Note will be required in connection with the transfer, disposition or sale by SBG of such Series II First Lien Note to an Affiliate of SBG; and

 

63

(ii) any Series III First Lien Note shall exchange each such Series III First Lien Note into a Series I First Lien Note in connection with the transfer, disposition or sale by the Third Party Investor of such Series III First Lien Note to a third party that is not an Affiliate of the Company, provided that, no such exchange of Series III First Lien Notes into Series I First Lien Note will be required in connection with the transfer, disposition or sale by the Third Party Investor of such Series III First Lien Note to an Affiliate of the Third Party Investor.

(c) If any portion of the exchanged notes are not fungible (including for U.S. federal income tax purposes) with any other portion of the Series I First Lien Notes, such exchanged notes and the Series II First Lien Notes and the Series III First Lien Notes shall trade separately under separate CUSIP numbers and ISINs, but shall be treated as the same series for purposes of this First Lien Indenture. Subject to the rights described above, the Series I First Lien Notes, the Series II First Lien Notes and the Series III First Lien Notes shall each constitute a separate series of First Lien Notes for all purposes under this First Lien Indenture, including in respect of any amendment, waiver, consent or other modification of this First Lien Indenture, redemption and offers to purchase or any other action by holders or exercise of remedies affecting the series held by them. For the avoidance of doubt, Holders of the Series I First Lien Notes, holders of the Series II First Lien Notes and holders of the Series III First Lien Notes shall be treated as separate classes with respect to Default and Events of Default. For the avoidance of doubt, any redemption of First Lien Notes pursuant to Section 3.07 or repurchase of First Lien Notes pursuant to Section 4.16 shall be made on a pro rata basis based on the aggregate principal amount of Series I First Lien Notes, Series II First Lien Notes and Series III First Lien Notes outstanding at such time.

ARTICLE 3

REDEMPTION

Section 3.01. Notices to Trustee.

If the Company elects to redeem First Lien Notes pursuant to Section 3.07, it shall furnish to the Trustee, at least two Business Days before notice of redemption is required to be mailed or caused to be mailed to Holders pursuant to Section 3.03 (unless a shorter notice shall be agreed to by the Trustee) but not more than 60 days before a redemption date, such notice and an Officer’s Certificate setting forth (1) the paragraph or subparagraph of such First Lien Note or Section of this First Lien Indenture pursuant to which the redemption shall occur, (2) the redemption date, (3) the principal amount of the First Lien Notes to be redeemed and (4) the redemption price, if then ascertainable.

Section 3.02. Selection of First Lien Notes to Be Redeemed or Purchased.

(a) If less than all of the then outstanding First Lien Notes are to be redeemed pursuant to Section 3.07 or purchased in an Offer to Purchase at any time, the Trustee shall select the First Lien Notes to be redeemed or purchased in compliance with the requirements of the principal national securities exchange on which the First Lien Notes are listed or, if the First Lien Notes are not so listed, on a pro rata basis, by lot or by such other method as the Trustee deems to be fair and appropriate in accordance with the applicable procedures of the Depositary. In the event of partial redemption or purchase by lot, the particular First Lien Notes to be redeemed or purchased shall be selected, unless otherwise provided herein, not less than 10 nor more than 60 days prior to the redemption date by the Trustee from the then outstanding First Lien Notes not previously called for redemption or purchase.

 

64

(b) The Trustee shall promptly notify the Company in writing of the First Lien Notes selected for redemption or purchase and, in the case of any First Lien Note selected for partial redemption or purchase, the principal amount thereof to be redeemed or purchased. First Lien Notes and portions of First Lien Notes selected shall be in amounts of $1.00 or integral multiples of $1.00; provided that no First Lien Notes of $1.00 in principal amount or less shall be redeemed in part. Except as provided in the preceding sentence, provisions of this First Lien Indenture that apply to First Lien Notes called for redemption or purchase also apply to portions of First Lien Notes called for redemption or purchase.

(c) After the redemption date or purchase date, upon surrender of a First Lien Note to be redeemed or purchased in part only, a new First Lien Note or First Lien Notes of the same Series of First Lien Notes in principal amount equal to the unredeemed or unpurchased portion of the original First Lien Note, representing the same Indebtedness to the extent not redeemed or not purchased, shall be issued in the name of the Holder of the First Lien Notes upon cancellation of the original First Lien Note (or appropriate book entries shall be made to reflect such partial redemption).

Section 3.03. Notice of Redemption.

(a) Subject to Section 3.09, the Company shall mail or deliver by electronic transmission in accordance with the applicable procedures of the Depositary, or cause to be mailed (or delivered by electronic transmission in accordance with the applicable procedures of the Depositary) notices of redemption of First Lien Notes not less than 10 days but not more than 60 days before the redemption date to each Holder whose First Lien Notes are to be redeemed pursuant to this Article at such Holder’s registered address or otherwise in accordance with the applicable procedures of the Depositary, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with Article 8 or Article 11. As set forth in Section 3.07(f), notices of redemption may be conditional.

(b) The notice shall identify the First Lien Notes to be redeemed (including CUSIP and ISIN number, if applicable) and shall state:

(1) the redemption date;

(2) the redemption price, including the portion thereof representing any accrued and unpaid interest; provided that in connection with a redemption under Section 3.07(a), the notice need not set forth the redemption price but only the manner of calculation thereof;

(3) if any First Lien Note is to be redeemed in part only, the portion of the principal amount of that First Lien Note that is to be redeemed;

(4) the name and address of the Paying Agent;

(5) that First Lien Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price;

 

65

(6) that, unless the Company defaults in making such redemption payment or the Paying Agent is prohibited from making such payment pursuant to the terms of this First Lien Indenture, interest on First Lien Notes called for redemption ceases to accrue on and after the redemption date;

(7) the paragraph or subparagraph of the First Lien Notes or Section of this First Lien Indenture pursuant to which the First Lien Notes called for redemption are being redeemed;

(8) that no representation is made as to the correctness or accuracy of the CUSIP or ISIN number, if any, listed in such notice or printed on the First Lien Notes; and

(9) if applicable, any condition to such redemption.

(c) At the Company’s request, the Trustee shall give the notice of redemption in the Company’s name and at the Company’s expense; provided that the Company shall have delivered to the Trustee, at least two Business Days before notice of redemption is required to be sent or caused to be sent to Holders pursuant to this Section 3.03 (unless a shorter notice shall be agreed to by the Trustee), such notice and an Officer’s Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in Section 3.03(b).

Section 3.04. Effect of Notice of Redemption.

Once notice of redemption is mailed in accordance with Section 3.03, First Lien Notes called for redemption become irrevocably due and payable on the redemption date at the redemption price (except as provided for in Section 3.07(f)). The notice, if mailed or delivered by electronic transmission in a manner herein provided, shall be conclusively presumed to have been given, whether or not the Holder of the First Lien Notes of the applicable Series receives such notice. In any case, failure to give such notice or any defect in the notice to the Holder of any First Lien Note designated for redemption in whole or in part shall not affect the validity of the proceedings for the redemption of any other First Lien Note. Subject to Section 3.05, on and after the redemption date, interest ceases to accrue on First Lien Notes or portions of First Lien Notes called for redemption.

Section 3.05. Deposit of Redemption or Purchase Price.

(a) No later than 11:00 a.m. (New York City time) on the redemption or purchase date (or such later time as such date to which the Trustee may reasonably agree), the Company shall deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption or purchase price of and accrued and unpaid interest on all First Lien Notes to be redeemed or purchased on that date. The Paying Agent shall promptly mail to each Holder whose First Lien Notes are to be redeemed or repurchased the applicable redemption or purchase price thereof and accrued and unpaid interest thereon. The Trustee or the Paying Agent shall promptly return to the Company any money deposited with the Trustee or the Paying Agent by the Company in excess of the amounts necessary to pay the redemption or purchase price of, and accrued and unpaid interest on, all First Lien Notes to be redeemed or purchased.

 

66

(b) If the Company complies with the provisions of Section 3.05(a), on and after the redemption or purchase date, interest shall cease to accrue on the First Lien Notes or the portions of First Lien Notes called for redemption or purchase. If a First Lien Note is redeemed or purchased on or after a Record Date but on or prior to the related Interest Payment Date, then any accrued and unpaid interest to the redemption or purchase date in respect of such First Lien Note will be paid on such redemption or purchase date to the Person in whose name such First Lien Note is registered at the close of business on such Record Date. If any First Lien Note called for redemption or purchase shall not be so paid upon surrender for redemption or purchase because of the failure of the Company to comply with Section 3.05(a), interest shall be paid on the unpaid principal, from the redemption or purchase date until such principal is paid, and, to the extent lawful, on any interest accrued to the redemption or purchase date not paid on such unpaid principal, in each case at the rate provided in the First Lien Notes and in Section 4.01.

Section 3.06. First Lien Notes Redeemed or Purchased in Part.

Upon surrender of a First Lien Note of a Series that is redeemed or purchased in part, the Company shall issue and, upon receipt of an Authentication Order, the Trustee shall promptly authenticate and mail to the Holder (or cause to be transferred by book entry) at the expense of the Company a new First Lien Note of the same Series of First Lien Notes equal in principal amount to the unredeemed or unpurchased portion of the First Lien Note surrendered representing the same Indebtedness to the extent not redeemed or purchased; provided that each new First Lien Note shall be in a minimum principal amount of $1.00 or an integral multiple of $1.00 in excess thereof. It is understood that, notwithstanding anything in this First Lien Indenture to the contrary, only an Authentication Order and not an Opinion of Counsel or Officer’s Certificate is required for the Trustee to authenticate such new First Lien Note.

Section 3.07. Optional Redemption.

(a) At any time and from time to time prior to November 1, 2024, the Company may redeem the First Lien Notes at its option, in whole or in part, upon notice pursuant to Section 3.03, at a redemption price equal to 100.0% of the aggregate principal amount of the First Lien Notes to be redeemed, plus the Applicable Premium, plus accrued and unpaid interest (including PIK Interest), if any, to but not including the redemption date.

(b) At any time and from time to time prior to November 1, 2024, the Company may redeem First Lien Notes at its option, in whole or in part, with the net cash proceeds received by the Company from any Equity Offering at a redemption price equal to 115% of the principal amount of such of First Lien Notes to be redeemed, plus accrued and unpaid interest (including PIK interest), if any, to, but excluding, the redemption date, in an aggregate principal amount for all such redemptions not to exceed 35% of the aggregate principal amount of the First Lien Notes issued under this First Lien Indenture (plus any PIK Interest thereon, included in both the numerator and denominator for such calculation); provided that

(1) in each case the redemption takes place not later than 90 days after the closing of the related Equity Offering, and

(2) not less than 60% of the aggregate principal amount of the First Lien Notes issued under this First Lien Indenture (plus any PIK Interest thereon, included in both the numerator and denominator for such calculation) remains outstanding immediately thereafter (excluding First Lien Notes held by the Company or any of its Restricted Subsidiaries), unless all such First Lien Notes are redeemed substantially concurrently.

 

67

(c) Except pursuant to clause (a) or (b) of this Section 3.07, the First Lien Notes shall not be redeemable at the Company’s option prior to November 1, 2024.

(d) At any time and from time to time on or after November 1, 2024, the Company may redeem the First Lien Notes at its option, in whole or in part, upon notice pursuant to Section 3.03, at a redemption price equal to 100.000% of the aggregate principal amount to be redeemed, plus accrued and unpaid interest (including PIK Interest), if any, on the First Lien Notes to be redeemed to (but not including) the redemption date.

(e) Any redemption pursuant to this Section 3.07 shall be made pursuant to the provisions of Section 3.01 through 3.06.

(f) Any redemption notice in connection with this Section 3.07 may, at the Company’s discretion, be subject to one or more conditions precedent, including completion of an Equity Offering or other corporate transaction.

(g) Any redemption of First Lien Notes shall be made on a pro rata basis based on the aggregate principal amount of Series I First Lien Notes, Series II First Lien Notes and Series III First Lien Notes outstanding at such time, subject to DTC’s applicable procedures.

Section 3.08. Mandatory Redemption; Open Market Purchases.

(a) The Company shall not be required to make any mandatory redemption or sinking fund payments with respect to the First Lien Notes.

(b) For the avoidance of doubt, the Company may acquire First Lien Notes by means other than a redemption or repurchase, whether by tender offer, open market purchases, negotiated transactions or otherwise, in accordance with applicable securities laws, so long as such acquisition does not otherwise violate the terms of this First Lien Indenture.

Section 3.09. Offers to Repurchase by Application of Excess Proceeds.

(a) In the event that, pursuant to Section 4.16, the Company is required to commence an Asset Disposition Offer, the Company will follow the procedures specified below.

(b) The Asset Disposition Offer shall remain open for a period of 20 Business Days following its commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Company will apply all Excess Proceeds to the purchase of the aggregate principal amount of First Lien Notes and, if applicable, Parity Lien Obligations (on a pro rata basis, if applicable) required to be offered for purchase pursuant to Section 4.16 (the “Asset Disposition Offer Amount”), or, if less than the Asset Disposition Offer Amount of First Lien Notes (and, if applicable, Parity Lien Obligations) has been so validly tendered, all First Lien Notes and Parity Lien Obligations validly tendered in response to the Asset Disposition Offer. Payment for any First Lien Notes so purchased will be made in the same manner as interest payments on the First Lien Notes are made.

(c) If the Asset Disposition Purchase Date is on or after a Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest up to but excluding the Asset Disposition Purchase Date, shall be paid on the Asset Disposition Purchase Date to the Person in whose name a First Lien Note is registered at the close of business on such Record Date.

 

68

(d) Upon the commencement of an Asset Disposition Offer, the Company shall mail a notice to each of the Holders or otherwise deliver such notice in accordance with the applicable procedures of the Depositary, with a copy to the Trustee. The notice shall contain all instructions and materials necessary to enable such Holders to tender First Lien Notes pursuant to the Asset Disposition Offer. The Asset Disposition Offer shall be made to all Holders and, if required, all holders of Parity Lien Obligations. The notice, which shall govern the terms of the Asset Disposition Offer, shall state:

(1) that an Asset Disposition Offer is being made pursuant to this Section 3.09 and Section 4.16 and the expiration time of the Asset Disposition Offer Period;

(2) the Asset Disposition Offer Amount, the purchase price, including the portion thereof representing any accrued and unpaid interest, and the Asset Disposition Purchase Date; and

(3) the procedures, determined by the Company, consistent with this First Lien Indenture that a Holder must follow in order to have its First Lien Notes repurchased.

(e) On or before the Asset Disposition Purchase Date, the Company shall, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary or as otherwise provided in Section 4.16(c), the Asset Disposition Offer Amount of First Lien Notes and Parity Lien Obligations or portions thereof validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or, if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all First Lien Notes and Parity Lien Obligations so tendered, in the case of the First Lien Notes, in integral multiples of $1.00; provided that if, following repurchase of a portion of a First Lien Note, the remaining principal amount of such First Lien Note outstanding immediately after such repurchase would be less than $1.00, then the portion of such First Lien Note so repurchased shall be reduced so that the remaining principal amount of such First Lien Note outstanding immediately after such repurchase is $1.00. The Company shall deliver, or cause to be delivered, to the Trustee the First Lien Notes so accepted and an Officer’s Certificate directing the Trustee to cancel the applicable First Lien Notes and stating the aggregate principal amount of First Lien Notes or portions thereof so accepted and that such First Lien Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.09.

(f) The Paying Agent shall promptly, but in no event later than five Business Days after termination of the Asset Disposition Offer Period, mail (or otherwise deliver in accordance with the applicable procedures of the Depositary) to each tendering Holder an amount equal to the purchase price of the First Lien Notes so validly tendered and not properly withdrawn by such Holder and accepted by the Company for purchase, and if less than all of the First Lien Notes tendered are purchased pursuant to the Asset Disposition Offer, the Company will promptly issue a new First Lien Note, and the Trustee, upon receipt of an Authentication Order, will authenticate and mail (or otherwise deliver in accordance with the applicable procedures of Depositary) (or cause to be transferred by book-entry) such new First Lien Note to such Holder (it being understood that, notwithstanding anything in this First Lien Indenture to the contrary, only an Authentication Order and no Opinion of Counsel or Officer’s Certificate is required for the

 

69

Trustee to authenticate and mail or deliver such new First Lien Note) in a principal amount equal to any unpurchased portion of the First Lien Note surrendered; provided that each such new First Lien Note will be in a minimum principal amount of $1.00 or an integral multiple of $1.00 in excess thereof. Any First Lien Note not so accepted will be promptly mailed or delivered by the Company to the Holder thereof.

(g) To the extent that the provisions of any securities laws or regulations conflict with the provisions of this First Lien Indenture, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this First Lien Indenture by virtue of any conflict.

(h) Other than as specifically provided in this Section 3.09 or Section 4.16, any purchase pursuant to this Section 3.09 shall be made pursuant to the applicable provisions of Sections 3.01 through 3.06.

ARTICLE 4

COVENANTS

Section 4.01. Payment of First Lien Notes.

(a) The Company shall pay, or cause to be paid, the principal of, premium, if any, cash interest and PIK Interest on, the First Lien Notes on the dates and in the manner provided in the First Lien Notes. Principal, premium, if any, and cash interest shall be considered paid on the date due if the Paying Agent, if other than the Company or a Subsidiary, holds as of 11:00 a.m. (New York City time) on the due date money deposited by the Company in immediately available funds and designated for and sufficient to pay the principal, premium, if any, and cash interest then due. PIK Interest will be considered paid on the date due if prior to such date the Trustee has received (i) a written order of the Company to increase the aggregate principal amount of an outstanding Global Note as a result of a PIK Payment in the amount set forth in such order or (ii) PIK Notes duly executed by the Company together with an Authentication Order pursuant to Section 2.02 requesting the authentication of such PIK Notes by the Trustee as of such Interest Payment Date. Interest shall be computed on the basis of a 360-day year comprised of twelve 30-day months.

(b) The Company shall pay cash interest (excluding PIK Interest) (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, at the rate equal to the then applicable cash interest rate (after giving effect to Section 6.02(d), but excluding the PIK Interest rate) on the First Lien Notes to the extent lawful; it shall pay cash interest (excluding PIK Interest) (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace period) at the same rate to the extent lawful.

Section 4.02. Maintenance of Office or Agency.

(a) The Company shall maintain an office or agency (which may be an office of the Trustee or an affiliate of the Trustee, Registrar or co-registrar) where First Lien Notes may be surrendered for registration of transfer or for exchange and where notices and demands to or upon the Company and the Guarantors in respect of the First Lien Notes and this First Lien Indenture may be served. The Company shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee.

 

70

(b) The Company may also from time to time designate additional offices or agencies where the First Lien Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations. The Company shall give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

(c) The Company hereby designates the Corporate Trust Office of the Trustee as one such office or agency of the Company in accordance with Section 2.03.

Section 4.03. [Reserved].

Section 4.04. Stay, Extension and Usury Laws.

Each of the Company and the Guarantors covenants (to the extent that it may lawfully do so) that it shall not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay, extension or usury law wherever enacted, now or at any time hereafter in force, that may affect the covenants or the performance of this First Lien Indenture; and each of the Company and the Guarantors (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it shall not, by resort to any such law, hinder, delay or impede the execution of any power herein granted to the Trustee, but shall suffer and permit the execution of every such power as though no such law has been enacted.

Section 4.05. Corporate Existence.

Subject to Article 5, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect (1) its corporate or limited liability company existence and the corporate, partnership, limited liability company or other existence of each of its Restricted Subsidiaries, in accordance with the respective organizational documents (as the same may be amended, supplemented or otherwise modified from time to time) of the Company or any such Restricted Subsidiary and (2) the rights (charter and statutory) of the Company and its Restricted Subsidiaries to conduct business; provided that the Company shall not be required to preserve any such right, or the corporate, partnership, limited liability company or other existence of any of its Restricted Subsidiaries, if the Company shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Company and its Restricted Subsidiaries, taken as a whole.

Section 4.06. Reports and Other Information.

(a) Notwithstanding that the Company may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, the Company shall provide to the Holders the following reports:

(1) within 90 days after the end of each fiscal year (beginning with the fiscal year ending December 31, 2023), an annual report containing substantially all the information that would have been required to be contained in an annual report on Form 10-K under the Exchange Act if the Company had been a reporting company under the Exchange Act (but only to the extent similar information is included in the Offering

 

71

Memorandum), including a “Management’s discussion and analysis of financial condition and results of operations” section and a report on the annual financial statements by the Company’s independent registered public accounting firm; provided that such annual report shall not be required to contain information required by Items 9A (controls and procedures), 10 (directors, executive officers and corporate governance) and 11 (executive compensation) of Form 10-K;

(2) within 45 days after the end of each of the first three fiscal quarters of each fiscal year (beginning with the fiscal quarter in which the Issue Date occurs), quarterly reports with respect to the most recent fiscal quarter and year-to-date period containing substantially all the information that would have been required to be contained in a quarterly report on Form 10-Q under the Exchange Act if the Company had been a reporting company under the Exchange Act (but only to the extent similar information is included in the Offering Memorandum), including a “Management’s discussion and analysis of financial condition and results of operations” section and unaudited quarterly financial statements prepared in accordance with GAAP; provided that such quarterly report shall not be required to contain the information required by Part I, Item 4 of Form 10-Q (controls and procedures); and

(3) within ten Business Days after the occurrence of each event that would have been required to be reported under Items 2.01 (Completion of Acquisition or Disposition of Assets), 2.06 (Material Impairments), 4.01 (Changes in Registrant’s Certifying Accountant), 4.02 (Non-Reliance on Previously Issued Financial Statements or a Related Audit Report or Completed Interim Review) and 5.01 (Changes in Control of Registrant) in a current report on Form 8-K under the Exchange Act if the Company had been a reporting company under the Exchange Act, current reports containing substantially all the information that would have been required by the foregoing items of Form 8-K to be contained in a current report on Form 8-K under the Exchange Act if the Company had been a reporting company under the Exchange Act;

provided that, for the avoidance of doubt, in each of the reports delivered pursuant to clause (1) or (2) above, the Company shall set forth a calculation of Adjusted EBITDA; provided, further, however, that, so long as the Company is not subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act, such reports (a) shall not be required to comply with Section 302 or 404 of the Sarbanes-Oxley Act of 2002 or related Items 307 and 308 of Regulation S-K promulgated by the SEC or Item 601 of Regulation S-K (with respect to exhibits), (b) shall not be required to comply with Section 13(r) of the Exchange Act (relating to the Iran Threat Reduction and Syrian Human Rights Act) or Rule 13p-1 under the Exchange Act and Form SD (relating to conflict minerals) or Item 10(e) of Regulation S-K (relating to non-GAAP financial measures), (c) shall not be required to contain the disclosure contemplated by Rule 13-01 or Rule 13-02 of Regulation S-X promulgated by the SEC or a separate financial footnote for Guarantors and Non-Guarantor Subsidiaries contemplated by Rule 3-10 or Rule 3-16 of Regulation S-X promulgated by the SEC, (d) shall not be required to comply with Section 3-09 of Regulation S-X to the extent that the Company determines in its good faith judgment that such information would not be material to the Holders or the business, assets, operations, financial positions or prospects of the Company and its Restricted Subsidiaries (and with respect to any financial statements required to be delivered under this clause (d), notwithstanding any law, rule or regulation that would require that some or all of such financial statements be audited, the Company may nonetheless deliver unaudited financial statements to satisfy such requirement) and (e) shall not be required to comply with Section 3-05 of Regulation S-X to the extent that the Company determines in its good faith judgment that such information would not be material to the Holders or the business,

 

72

assets, operations, financial positions or prospects of the Company and its Restricted Subsidiaries (and with respect to any financial statements required to be delivered under this clause (e), notwithstanding any law, rule or regulation that would require that some or all of such financial statements be audited, the Company may nonetheless deliver unaudited financial statements to satisfy such requirement).

(b) In addition, to the extent not satisfied by the foregoing, for so long as any First Lien Notes are outstanding, the Company shall furnish to Holders and to prospective purchasers of the First Lien Notes, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act. The requirements set forth in this clause (b) and the preceding clause (a) of this Section 4.06 may be satisfied by delivering such information to the Trustee and posting copies of such information on a website (which may be nonpublic and may be maintained by the Company or a third party) to which access will be given to Holders, bona fide prospective purchasers of the First Lien Notes (which prospective purchasers will be limited to “qualified institutional buyers” within the meaning of Rule 144A of the Securities Act or non-U.S. persons (as defined in Regulation S under the Securities Act)), securities analysts and market making institutions that certify their status as such to the reasonable satisfaction of the Company and who agree to treat such information as confidential.

(c) The Company will be permitted to satisfy its obligations under this covenant with respect to financial information relating to the Company (including, for the avoidance of doubt, the obligation to provide a calculation of Adjusted EBITDA) by furnishing financial information relating to any Parent Entity; provided that the same is accompanied by consolidating information that explains in reasonable detail the differences between the information relating to such Parent Entity (and other Parent Entities included in such information, if any), on the one hand, and the information relating to the Company and its Restricted Subsidiaries on a standalone basis, on the other hand. For the avoidance of doubt, the consolidating information referred to in the proviso in the preceding sentence need not be audited.

(d) Notwithstanding anything to the contrary set forth above, if the Company or any Parent Entity has furnished the Holders of First Lien Notes or filed with the SEC the reports described in the preceding paragraphs with respect to the Company or any Parent Entity, the Company shall be deemed to be in compliance with the provisions of this covenant.

(e) In addition, no later than fifteen Business Days after the date the annual and quarterly financial information for the prior fiscal period have been filed or furnished pursuant to Section 4.06(a)(1) or 4.06(a)(2) above, the Company or any Parent Entity shall also hold live quarterly conference calls with the opportunity to ask questions of the Company or such Parent Entity, as applicable (it being understood that such quarterly conference call may be the same conference call as that held for Company’s or, as applicable, any Parent Entity’s equity investors, debt investors or analysts). Prior to the date such conference call is to be held, the Company, or, as applicable, the applicable Parent Entity shall issue a press release to the appropriate U.S. wire services or otherwise announce such quarterly conference call for the benefit of the Holders, beneficial owners of the First Lien Notes, bona fide prospective purchasers of the First Lien Notes (which prospective purchasers shall be limited to “qualified institutional buyers” within the meaning of Rule 144A of the Securities Act or non-U.S. persons (as defined in Regulation S under the Securities Act) that certify their status as such to the reasonable satisfaction of the Company), securities analysts and market making financial institutions, which press release shall contain the time and the date of such conference call and include information on how to access such quarterly conference call.

 

73

(f) If the Company has designated any of its Subsidiaries as Unrestricted Subsidiaries and such Unrestricted Subsidiaries, either individually or collectively, held more than 10.0% of Consolidated Total Assets as of the end of the most recent fiscal quarter for which internal financial statements prepared on a consolidated basis in accordance with GAAP are available (the “balance sheet date”) or accounted for more than 10.0% of consolidated total revenue of the Company and its Restricted Subsidiaries for the period of the most recent four consecutive fiscal quarters ended on the balance sheet date, then the annual and quarterly financial information required by Section 4.06(a) shall include a reasonably detailed presentation, as determined in good faith by the Company, of selected financial metrics (which metrics will be selected by the Company in its sole discretion) of such Unrestricted Subsidiaries as a group in the “Management’s discussion and analysis of financial condition and results of operations” section.

(g) To the extent any information is not provided within the time periods specified in this Section 4.06 and such information is subsequently provided, the Company will be deemed to have satisfied its obligations with respect thereto at such time and any Default that has not become an Event of Default with respect thereto shall be deemed to have been cured.

(h) Delivery of the reports, information and documents in accordance with this Section 4.06 shall satisfy the Company’s obligation to make such delivery, but, in the case of the Trustee, such delivery shall be for informational purposes only, and the Trustee’s receipt of such reports, information and documents shall not constitute constructive or actual notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants (as to which the Trustee is entitled to conclusively rely on an Officer’s Certificate). The Trustee is under no duty to examine such reports, information or documents to ensure compliance with the provisions of this First Lien Indenture or to ascertain the correctness or otherwise of the information or the statements contained therein. The Trustee shall have no liability or responsibility for the filing, timeliness or content of any such report, and the Trustee shall have no duty to participate in or monitor any conference calls.

Section 4.07. Compliance Certificate.

(a) The Company will deliver to the Trustee, within 120 days after the end of each fiscal year ending after the Issue Date, a certificate from the principal executive officer, principal financial officer or principal accounting officer stating that a review of the activities of the Company and its Restricted Subsidiaries during the preceding fiscal year has been made under the supervision of the signing Officer, and further stating, as to such Officer signing such certificate, that to his or her knowledge, the Company and each Guarantor have kept, observed, performed and fulfilled each and every condition and covenant contained in this First Lien Indenture and is not in default in the performance or observance of any of the terms, provisions, covenants and conditions of this First Lien Indenture (or, if a Default shall have occurred, describing all such Defaults of which he or she may have knowledge and what action the Company and each Guarantor are taking or propose to take with respect thereto).

(b) When any Default has occurred and is continuing under this First Lien Indenture, the Company will promptly (which shall be within 30 days following the date on which the Company becomes aware of such Default or receives notice of such Default, as applicable) send to the Trustee an Officer’s Certificate specifying such event, its status and what action the Company is taking or proposes to take with respect thereof.

 

74

Section 4.08. Limitation on Restricted Payments.

(a) The Company shall not, and shall not permit any of its Restricted Subsidiaries, directly or indirectly, to:

(1) declare or pay any dividend or make any distribution (whether made in cash, securities or other property) on or in respect of its or any of its Restricted Subsidiaries’ Equity Interests (including any payment in connection with any merger or consolidation involving the Company or any of its Restricted Subsidiaries) other than:

(a) dividends or distributions payable solely in Equity Interests of the Company (other than Disqualified Stock); and

(b) dividends or distributions by a Restricted Subsidiary, so long as, in the case of any dividend or distribution payable on or in respect of any Capital Stock issued by a Restricted Subsidiary that is not a Wholly Owned Subsidiary, the Company or the Restricted Subsidiary holding such Capital Stock receives at least its pro rata share of such dividend or distribution;

(2) purchase, redeem, retire or otherwise acquire for value, including in connection with any merger or consolidation, any Equity Interests of the Company or any direct or indirect parent company of the Company held by Persons other than the Company or a Restricted Subsidiary;

(3) make any principal payment on, or purchase, repurchase, redeem, defease or otherwise acquire or retire for value, prior to any scheduled repayment, scheduled sinking fund payment or scheduled maturity, any Restricted Debt, other than Indebtedness of the Company owing to and held by any Restricted Subsidiary or Indebtedness of a Restricted Subsidiary owing to and held by the Company or any other Restricted Subsidiary; or

(4) make any Restricted Investment

(all such payments and other actions referred to in clauses (1) through (4) above (other than any exception thereto) shall be referred to as a “Restricted Payment”).

(b) Section 4.08(a) shall not prohibit:

(1) any Restricted Payment made in exchange for, or out of the proceeds of the substantially concurrent sale of, Equity Interests of the Company (other than Disqualified Stock and other than Equity Interests issued or sold to a Subsidiary of the Company or an employee stock ownership plan or similar trust to the extent such sale to an employee stock ownership plan or similar trust is financed by loans from or Guaranteed by the Company or any Restricted Subsidiary unless such loans have been repaid with cash on or prior to the date of determination); provided, however, that any such Restricted Payment made pursuant to this clause (1) shall not be used to purchase, repurchase, redeem, defease or otherwise acquire or retire Restricted Debt;

(2) any purchase, repurchase, redemption, defeasance or other acquisition or retirement of Restricted Debt made by exchange for, or out of the proceeds of the substantially concurrent sale of Restricted Debt that is permitted to be Incurred pursuant to Section 4.09 and Section 4.10 and constitutes Refinancing Indebtedness in respect of such acquired or retired Restricted Debt;

 

75

(3) any purchase, repurchase, redemption, defeasance or other acquisition or retirement of Disqualified Stock of the Company or a Restricted Subsidiary made in exchange for, or out of the proceeds of the substantially concurrent sale of Disqualified Stock of the Company or a Restricted Subsidiary so long as such refinancing Disqualified Stock is permitted to be Incurred pursuant to Section 4.09 and constitutes Refinancing Indebtedness;

(4) to the extent required by the terms of any Restricted Debt, the purchase, repurchase, redemption, defeasance or other acquisition or retirement for value of any Restricted Debt (a) at a purchase price not greater than 101% of the principal amount of such Restricted Debt in the event of a Change of Control or (b) at a purchase price not greater than 100% of the principal amount thereof in the event of an Asset Disposition; provided that, prior to or simultaneously with such purchase, repurchase, redemption, defeasance or other acquisition or retirement, the Company has made the Change of Control Offer or Asset Disposition Offer, as applicable, as provided in Section 4.15 or 4.16 with respect to the First Lien Notes and has completed the repurchase or redemption of all First Lien Notes validly tendered for payment in connection with such Change of Control Offer or Asset Disposition Offer;

(5) dividends paid within 60 days after the date of declaration if at such date of declaration such dividend would have complied with this Section 4.08;

(6) the purchase, redemption or other acquisition (including by cancellation of indebtedness), cancellation or retirement for value of Equity Interests of the Company or any direct or indirect parent company of the Company held by any existing or former directors, employees, management, consultants, advisors or service providers of the Company or any Subsidiary of the Company or their assigns, estates or heirs, in each case in connection with the repurchase provisions under stock option or stock purchase agreements or other agreements approved by the Board of Directors of the Company; provided that such repurchases, redemptions or other acquisitions pursuant to this clause shall not exceed $25.00 million in the aggregate during any calendar year (with any unused amounts in any calendar year being carried over to the immediately succeeding calendar year subject to a maximum of $50.00 million in any calendar year), although such amount in any calendar year may be increased by an amount not to exceed:

(a) the Net Cash Proceeds from the sale of Capital Stock (other than Disqualified Stock) of the Company and, to the extent contributed to the Company, the Net Cash Proceeds from the sale of Capital Stock of any of the Company’s direct or indirect parent companies, in each case to existing or former employees or members of management of the Company, any of its Subsidiaries or any of its direct or indirect parent companies that occurs after the Reference Date; plus

(b) the cash proceeds of key man life insurance policies received by the Company or its Restricted Subsidiaries after the Reference Date; less

(c) the amount of any Restricted Payments made since the Reference Date with the Net Cash Proceeds described in clauses (a) and (b) of this clause (6);

(7) the declaration and payment of dividends to holders of any class or series of Disqualified Stock of the Company issued in accordance with the terms of this First Lien Indenture to the extent such dividends are included in the definition of “Consolidated Interest Expense”;

 

76

(8) repurchases of Equity Interests deemed to occur upon the exercise, conversion or exchange of stock options, warrants or other rights to purchase Capital Stock or other convertible or exchangeable securities if such Equity Interests represent all or portion of the exercise price thereof or in connection with the exercise or vesting of stock options, warrants or other rights to the extent necessary to pay withholding taxes related to such exercise or vesting;

(9) any payment to the holders of Equity Interests (or to the holders of Indebtedness that is convertible into or exchangeable for Equity Interests upon such conversion or exchange) in lieu of the issuance of fractional shares;

(10) the distribution, by dividend or otherwise, of shares of Capital Stock of Unrestricted Subsidiaries;

(11) tax distributions in an aggregate amount not to exceed the amount required to be distributed pursuant to Section 4.2 of the Partnership Agreement (disregarding for this purpose any limitations on such tax distributions imposed by reference to any credit limitation or financing agreement, and excluding any tax distributions arising from income (if any) attributable to the Exchange Offers); provided that any such amounts distributed to any Parent Entity (as defined in the Partnership Agreement) and (i) not used to pay a tax liability or (ii) to the extent used to pay a tax liability, ultimately refunded to any such Parent Entity (as defined in the Partnership Agreement) by the applicable taxing authority, and, in each case, required to be contributed to the Partnership pursuant to Section 4.2 of the Partnership Agreement, shall be contributed to the Company;

(12) the purchase, repurchase, redemption, defeasance or other acquisition or retirement of Restricted Debt (a) in an aggregate purchase price not to exceed $25.00 million; provided, that the purchase price of any such Restricted Debt shall not exceed 60.000% of the principal amount thereof; or (b) with Capital Stock of any Parent Entity or using any Net Cash Proceeds from any Equity Offering of Capital Stock of any Parent Entity (x) at any time prior to the date that is 60 days prior to the Stated Maturity of such Restricted Debt, at a purchase price of any such Restricted Debt, or for Capital Stock of any Parent Entity with a value, that does not exceed 60.000% of the principal amount thereof or (y) at any time on or after 60 days prior to the Stated Maturity of such Restricted Debt; and

(13) the issuance of Capital Stock of the Company or any Parent Entity or other securities or property (i) following a merger event or other Change of Control or (ii) upon conversion or exchange of the Second Lien Exchangeable Notes or the Third Lien Exchangeable Notes provided, that, for the avoidance of doubt, for purposes of this clause (13), property shall not consist of cash or Cash Equivalents.

provided, however, that at the time of and after giving effect to, any Restricted Payment permitted under clauses (6), (7), (10) and (12) hereunder, no Default shall have occurred and be continuing or would occur as a consequence thereof.

 

77

(c) The amount of all Restricted Payments (other than cash) will be the Fair Market Value on the date of such Restricted Payment of the assets or securities proposed to be transferred or issued by the Company or such Restricted Subsidiary, as the case may be, pursuant to such Restricted Payment. The amount of any Restricted Payment paid in cash shall be its face amount.

(d) To the extent any cash or any other property is paid or distributed by the Company or any of its Restricted Subsidiaries upon the conversion or exchange of any Indebtedness of the Company or its Restricted Subsidiaries convertible or exchangeable for Equity Interests of the Company or upon any other acquisition or retirement of any such Indebtedness of the Company or any of its Restricted Subsidiaries for an amount based on the value of such Equity Interests, (1) any amount of such cash or property that exceeds the principal amount of the Indebtedness that is converted, exchanged, acquired or retired and any accrued interest paid thereon (and only such excess amount) shall be deemed to be a Restricted Payment under Section 4.08(a)(2) and (2) the amount of such cash or property up to an amount equal to the principal amount of the Indebtedness that is converted, exchanged, acquired or retired shall be deemed to be a Restricted Payment under Section 4.08(a)(3) if such Indebtedness is a Restricted Debt. If the Company or any of its Restricted Subsidiaries repurchases any Indebtedness of the Company or its Restricted Subsidiaries convertible or exchangeable for Equity Interests of the Company in the open market at a price in excess of the principal amount of such Indebtedness and any accrued interest thereon, such excess amount shall be deemed to be a Restricted Payment under Section 4.08(a)(2).

(e) For the purpose of determining compliance with this Section 4.08, in the event that a Restricted Payment meets the criteria of more than one of the clauses above under Section 4.08(b) or one or more of the clauses in the definition of “Permitted Investment,” the Company, in its sole discretion, shall be permitted to classify such Restricted Payment and may later reclassify all or a portion of such Restricted Payment in any manner that complies with this Section 4.08 and will be entitled to divide the amount and type of such Restricted Payment among more than one of such clauses under this Section 4.08 and the definition of “Permitted Investment.” A Restricted Payment need not be permitted solely by reference to one provision permitting such Restricted Payment but may be permitted in part by one such provision and in part by one or more other provisions of this Section 4.08, including the definition of “Permitted Investment.”

Section 4.09. Limitation on Indebtedness.

(a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, Incur any Indebtedness (including Acquired Indebtedness).

(b) Section 4.09(a) shall not prohibit the Incurrence of the following Indebtedness:

(1) Indebtedness of the Company or any Restricted Subsidiary in an aggregate principal amount outstanding which, when taken together with the principal amount of all other Indebtedness Incurred pursuant to this clause (1) and then outstanding, including any Refinancing Indebtedness in respect thereof, does not exceed (i) $1,012.5 million plus (ii) any PIK Interest or other payment-in-kind interest thereon (or the principal amount of any Refinancing Indebtedness in respect of Indebtedness that was Incurred under this clause (1)) (the “First Lien Notes Cap”);

 

78

(2) Indebtedness of the Company or any Restricted Subsidiary Incurred under the Letter of Credit Facility in an aggregate principal amounts not to exceed $1,520.0 million; provided, that such Indebtedness shall be available solely (i) with respect to the issuance and creation of letters of credit to third parties to secure performance obligations of WeWork Inc., the Company, any Restricted Subsidiary or Unrestricted Subsidiary; (ii) in a manner otherwise consistent with past practice with respect to borrowings under the Senior L/C Tranche; or (iii) with respect to the Junior L/C Tranche (as defined in the Letter of Credit Facility), in the amount outstanding as of the Issue Date; provided, further, that (x) newly issued letters of credit after the Issue Date shall not be issued to the Company or any of its Subsidiaries or Affiliates and (y) letters of credit under the Letter of Credit Facility may not be extended or otherwise modified if, as a result of such extension or modification (including any successive extension or modification), such Indebtedness would have a term in excess of one year. For the avoidance of doubt, the amount pursuant to this clause (2) shall not be reduced by a reduction of commitment or Indebtedness Incurred under the LC Facility after the Issue Date;

(3) the Existing Unsecured Notes (including any related guarantees) and all other Indebtedness of the Company and its Restricted Subsidiaries in existence on the Issue Date or Incurred pursuant to any commitment outstanding on the Issue Date (in each case, other than Indebtedness Incurred under clauses (1), (2), (20), (21), (22), (23) and (24) of this Section 4.09(b));

(4) Guarantees by (a) the Company or any Guarantor of Indebtedness permitted to be Incurred by the Company or a Guarantor in accordance with the provisions of this First Lien Indenture; provided that in the event such Indebtedness that is being Guaranteed is subordinated in right of payment to the First Lien Notes or the Note Guarantee, then the Guarantee shall be subordinated to the same extent as the Indebtedness being Guaranteed and (b) Non-Guarantor Subsidiaries of Indebtedness Incurred by Non-Guarantor Subsidiaries in accordance with the provisions of this First Lien Indenture;

(5) Indebtedness of the Company owing to and held by any Restricted Subsidiary or Indebtedness of a Restricted Subsidiary owing to and held by the Company or any other Restricted Subsidiary; provided, however,

(a) if the Company is the obligor on Indebtedness owing to a Non-Guarantor Subsidiary, such Indebtedness is expressly subordinated in right of payment to the First Lien Notes;

(b) if a Guarantor is the obligor on Indebtedness owing to a Non-Guarantor Subsidiary, such Indebtedness is expressly subordinated in right of payment to the Note Guarantee of such Guarantor; and

(c) (i) any subsequent issuance or transfer of Equity Interests or any other event which results in any such Indebtedness being held by a Person other than the Company or a Restricted Subsidiary of the Company; and

(ii) any sale or other transfer of any such Indebtedness to a Person other than the Company or a Restricted Subsidiary of the Company shall be deemed, in each case under this clause (5)(c), to constitute an Incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;

 

79

(6) Preferred Stock of a Restricted Subsidiary held by the Company or any other Restricted Subsidiary; provided, however,

(a) any subsequent issuance or transfer of Capital Stock or any other event which results in such Preferred Stock being held by a Person other than the Company or a Restricted Subsidiary of the Company; and

(b) any sale or other transfer of any such Preferred Stock to a Person other than the Company or a Restricted Subsidiary of the Company shall be deemed, in each case, to constitute an Incurrence of such Preferred Stock by such Subsidiary (and, if applicable, may be Incurred pursuant to clause (16) of this Section 4.09(b));

(7) Acquired Indebtedness; provided, however, that at the time of such Incurrence, on a pro forma basis, the Consolidated Leverage Ratio for the Company and its Restricted Subsidiaries would be equal to or lower than such ratio immediately prior to such Incurrence;

(8) Indebtedness under Hedging Obligations that are Incurred in the ordinary course of business (whether or not consistent with past practice) and not for speculative purposes;

(9) Indebtedness (including Capitalized Lease Obligations) of the Company or a Restricted Subsidiary Incurred to finance the purchase, lease, construction or improvement of any property, plant or equipment used or to be used in the business of the Company or such Restricted Subsidiary through the direct purchase, lease, construction or improvement of such property, plant or equipment, and any Indebtedness of the Company or a Restricted Subsidiary which serves to refund or refinance any Indebtedness Incurred pursuant to this clause (9), and any Guarantees by the Company or any Restricted Subsidiary of any of the foregoing, in an aggregate outstanding principal amount which, when taken together with the principal amount of all other Indebtedness Incurred pursuant to this clause (9) and then outstanding, shall not exceed $100.00 million;

(10) Indebtedness Incurred by the Company or its Restricted Subsidiaries in respect of workers’ compensation claims, health, disability or other employee benefits or property, casualty or liability insurance, self-insurance obligations, performance, bid, surety and similar bonds and completion Guarantees (not for borrowed money) provided in the ordinary course of business (whether or not consistent with past practice);

(11) Indebtedness arising from agreements of the Company or a Restricted Subsidiary providing for indemnification, adjustment of purchase price, earn-out or similar obligations, in each case, Incurred or assumed in connection with the disposition of any business or assets of the Company or any business, assets or Capital Stock of a Restricted Subsidiary; provided that such Indebtedness is not reflected on the balance sheet of the Company or any of its Restricted Subsidiaries (contingent obligations referred to in a footnote to financial statements and not otherwise reflected on the balance sheet shall not be deemed to be reflected on such balance sheet for purposes of this clause (11));

 

80

(12) Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds; provided, however, that such Indebtedness is extinguished within 30 Business Days of Incurrence;

(13) the Incurrence by the Company or any Restricted Subsidiary of Refinancing Indebtedness that serves to refund or refinance any Indebtedness Incurred as permitted under clauses (2), (3), (7), (13), (20), (21), (22), (23) and (24) of this Section 4.09(b); provided, that in the case of clause (2), such Refinancing Indebtedness (x) shall either (i) provide that the Collateral Agent is the “controlling agent” in the pari passu intercreditor agreement or (ii) include the same credit support by SVF Obligor on terms that are no less favorable than the Letter of Credit Facility in effect as of the Issue Date insofar as the terms relate to any obligation of the SVF Obligor or any other SBG entity to prepay, reimburse or cash collateralize the obligations of the Company and the SVF Obligor under the Credit Agreement in accordance with Sections 11.1 or 11.2 of the Credit Agreement or the Parent Indemnity, and (y) solely with respect to any Refinancing Indebtedness that serves to refund or refinance the Junior L/C Tranche (as defined in the Credit Agreement), such Refinancing Indebtedness may in the form of loans (it being understood and agreed that the Senior L/C tranche may be refunded or refinanced solely with commitments under a new letter of credit facility that complies with the term of clause (2)); provided, further, that in the case of clauses (3), (20), (21), (22), (23) and (24) such Refinancing Indebtedness shall be on terms that are not materially less favorable to the rights of Holders of the First Lien Notes than such Indebtedness as in effect on the Issue Date, as determined by the Company in good faith;

(14) Indebtedness of the Company or its Restricted Subsidiaries to lessors or Affiliates of lessors of office facilities leased by the Company or such Restricted Subsidiary to finance tenant improvements at such office facility;

(15) (a) Indebtedness representing deferred compensation, severance, pension and health and welfare retirement benefits or the equivalent to current and former employees of the Company and its Restricted Subsidiaries Incurred in the ordinary course of business (whether or not consistent with past practice); (b) guarantees of Indebtedness of directors, officers, employees, agents and advisors of the Company or any of its Restricted Subsidiaries in respect of expenses of such Persons in connection with relocations and other ordinary course of business purposes (whether or not consistent with past practice); and (c) Indebtedness evidenced by promissory notes issued to former or current directors, officers, employees or consultants (or their transferees, estates or beneficiaries under their estates) of the Company or any of its Restricted Subsidiaries in lieu of any cash payment;

(16) Preferred Stock of a Non-Guarantor Subsidiary; provided that such Preferred Stock (a) does not provide by its terms for any cash payment on or prior to the date that is 91 days after the earlier of the final maturity date of the First Lien Notes or the date the First Lien Notes are no longer outstanding and (b) does not constitute Disqualified Stock;

 

81

(17) in addition to the items referred to in this Section 4.09, Indebtedness of the Company and its Restricted Subsidiaries in an aggregate outstanding principal amount which, when taken together with the principal amount of all other Indebtedness Incurred pursuant to this clause (17) and then outstanding, including any Indebtedness of the Company or a Restricted Subsidiary that serves to refund or refinance any Indebtedness Incurred pursuant to this clause (17), shall not exceed $100.0 million, provided that any Indebtedness Incurred by Non-Guarantor Subsidiaries pursuant to this clause (17) (i) shall not exceed $50.0 million and (ii) either (x) shall not be Secured Indebtedness or (y) shall be Junior Lien Debt;

(18) [reserved];

(19) without duplication, all premiums (if any), interest, including interest payable in kind, fees, expenses, charges and additional or contingent interest on any obligations permitted pursuant to any other clause under this Section 4.09;

(20) the Second Lien Notes in an aggregate amount not to exceed the Second Lien Notes issued on the Issue Date and Second Lien Note Guarantees thereof, plus any payment-in-kind interest thereon;

(21) the Third Lien Notes in an aggregate amount not to exceed the Third Lien Notes issued on the Issue Date and Third Lien Note Guarantees thereof, plus any payment-in-kind interest thereon;

(22) the Second Lien Exchangeable Notes, in an aggregate principal amount outstanding not to exceed $187.5 million, and Second Lien Exchangeable Note Guarantees thereof, plus any payment-in-kind interest thereon;

(23) the Third Lien Exchangeable Notes, in an aggregate principal amount outstanding not to exceed $269.625 million, Third Lien Exchangeable Note Guarantees thereof, plus any payment-in-kind interest thereon; and

(24) Second Lien Notes or Indebtedness that is pari passu with the Second Lien Notes issued in exchange for any Existing Unsecured Notes following the Issue Date in an aggregate principal amount outstanding not to exceed 60.0% of the aggregate principal amount of Existing Unsecured Notes exchanged therefor, plus any payment-in-kind interest thereon.

(c) Notwithstanding anything to the contrary in this First Lien Indenture, the Company shall not be permitted to Incur additional Indebtedness after the Issue Date under Section 4.09(b) (i) if the proceeds thereof are used, directly or indirectly, to refinance any Restricted Debt unless such Indebtedness will be subordinated in right of payment to the First Lien Notes to at least the same extent as such Restricted Debt, (ii) that has Lien or payment priority senior to the Notes Obligations, (iii) that is incremental Parity Lien Debt that is pari passu to the First Lien Notes (other than, for the avoidance of doubt, any Series II or Series III First Lien Notes Incurred on a “delayed draw” basis pursuant to clause (1) of the preceding paragraph and Indebtedness otherwise Incurred pursuant to clauses (1) or (2) of the preceding paragraph and Refinancing Indebtedness in respect of Indebtedness Incurred pursuant to clause (2) of the preceding paragraph permitted to be Incurred hereunder), (iv) that is incremental Second Priority Lien Indebtedness that is pari passu to the Second Priority Lien Debt (other than Indebtedness Incurred pursuant to clauses (22) and (24) of the preceding paragraph and Refinancing Indebtedness in respect of Indebtedness Incurred pursuant to clauses (20), (22) and (24) of the preceding paragraph permitted to be Incurred hereunder) or (v) that is incremental Third Priority Lien Indebtedness that is pari passu to the Third Priority Lien Debt (other than Indebtedness Incurred pursuant to clause (23) of the preceding paragraph and Refinancing Indebtedness in respect of Indebtedness Incurred pursuant to clauses (21) and (23) of the preceding paragraph permitted to be Incurred hereunder).

 

82

(d) For purposes of determining compliance with this Section 4.09:

(1) except as set forth below, in the event that Indebtedness meets the criteria of more than one of the types of Indebtedness under Section 4.09(b), the Company, in its sole discretion, shall classify such item of Indebtedness on the date of Incurrence and may later reclassify all or a portion of such item of Indebtedness in any manner that complies with this Section 4.09 and will be entitled to divide the amount and type of such Indebtedness among more than one of such clauses under Section 4.09(b);

(2) notwithstanding clause (1) above, the First Lien Notes and any payment-in-kind interest thereon, and any Refinancing Indebtedness in respect thereof, shall be deemed to have been Incurred under Section 4.09(b)(1) of this covenant and may not later be reclassified (including, for the avoidance of doubt, the Series II First Lien Notes and Series III First Lien Notes to be Incurred on a “delayed draw” basis after the Issue Date);

(3) notwithstanding clause (1) above, all Indebtedness outstanding on the Issue Date under the Letter of Credit Facility (collectively, “Existing Bank Facility Debt”) shall be deemed to have been Incurred under Section 4.09(b)(2) and may not later be reclassified;

(4) an item of Indebtedness need not be permitted solely by reference to one provision permitting such Indebtedness but may be permitted in part by one such provision and in part by one or more other provisions of this Section 4.09;

(5) if obligations in respect of letters of credit or surety or performance bonds are Incurred pursuant to a Debt Facility under clause (1) of Section 4.09(b) and relate to other Indebtedness, then such letters of credit or surety or performance bonds shall be treated as Incurred pursuant to clause (1) of Section 4.09(b), as the case may be, and such other Indebtedness shall not be included;

(6) except as provided in clause (4) of this Section 4.09(d), Guarantees of, or obligations in respect of letters of credit or surety or performance bonds relating to, Indebtedness that is otherwise included in the determination of a particular amount of Indebtedness shall not be included; and

(7) the accrual of interest, the accretion or amortization of original issue discount, and the payment of interest on any Indebtedness in the form of additional Indebtedness with the same terms, shall not be deemed to be an Incurrence of Indebtedness pursuant to this Section 4.09.

(e) Pursuant to an Officer’s Certificate delivered to the Trustee, the Company or a Restricted Subsidiary may elect to treat all or any portion of the commitment to provide any Indebtedness (including with respect to any revolving loan commitment) as being Incurred at the time of such commitment, or, with respect to the Existing Bank Facility Debt, on the Issue Date, in which case any subsequent Incurrence of Indebtedness that is the subject of such commitment shall not be deemed to be an Incurrence at such subsequent time. Such Indebtedness shall be deemed to be outstanding for purposes of calculating the Consolidated Leverage Ratio, as applicable, for any period in which the Company makes any such election and for any subsequent period until such commitments or such Indebtedness, as applicable, are no longer outstanding.

 

83

(f) The Company shall not permit any of its Unrestricted Subsidiaries to Incur any Indebtedness, other than Non-Recourse Debt. If at any time an Unrestricted Subsidiary becomes a Restricted Subsidiary, any Indebtedness of such Subsidiary shall be deemed to be Incurred by a Restricted Subsidiary as of such date (and, if such Indebtedness is not permitted to be Incurred as of such date under this Section 4.09, the Company shall be in Default of this Section 4.09).

(g) For purposes of determining compliance with any U.S. dollar-denominated restriction on the Incurrence of Indebtedness, the U.S. dollar-equivalent principal amount of Indebtedness denominated in a foreign currency shall be calculated based on the relevant currency exchange rate in effect on the date such Indebtedness was Incurred, in the case of term Indebtedness, or first committed, in the case of revolving credit Indebtedness; provided that if such Indebtedness is Incurred to refinance other Indebtedness denominated in a foreign currency, and such refinancing would cause the applicable U.S. dollar-denominated restriction to be exceeded if calculated at the relevant currency exchange rate in effect on the date of such refinancing, such U.S. dollar-denominated restriction shall be deemed not to have been exceeded so long as the principal amount of such Refinancing Indebtedness does not exceed the principal amount of such Indebtedness being refinanced. Notwithstanding any other provision of this Section 4.09, the maximum amount of Indebtedness that the Company and its Restricted Subsidiaries may Incur pursuant to this Section 4.09 shall not be deemed to be exceeded solely as a result of fluctuations in the exchange rate of currencies. The principal amount of any Indebtedness Incurred to refinance other Indebtedness, if Incurred in a different currency from the Indebtedness being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such Refinancing Indebtedness is denominated that is in effect on the date of such refinancing.

(h) The Company shall not, and shall not permit any Guarantor to, directly or indirectly, Incur any Indebtedness (including Acquired Indebtedness) that is or purports to be by its terms (or by the terms of any agreement governing such Indebtedness) subordinated or junior in right of payment to any other Indebtedness (including Acquired Indebtedness) of the Company or such Guarantor, as the case may be, unless such Indebtedness is subordinated in right of payment to the First Lien Notes or such Guarantor’s Guarantee, as the case may be, on substantially identical terms as such Indebtedness is subordinated to such other Indebtedness of the Company or such Guarantor, as the case may be; provided, however, that no Indebtedness of the Company or any Guarantor will be deemed to be contractually subordinated in right of payment to any other Indebtedness of the Company or any Guarantor solely by virtue of being unsecured or having a junior Lien priority. For purposes of the foregoing, no Indebtedness shall be deemed to be contractually subordinate or junior in right of payment to any other Indebtedness solely by virtue of (1) being unsecured or (2) its having a junior priority with respect to the same collateral.

Section 4.10. Limitation on Liens.

(a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, Incur, assume or suffer to exist any Lien securing any Indebtedness on any of its property or assets (including Equity Interests of Subsidiaries), whether owned on the Issue Date or acquired after that date, unless:

 

84

(1) in the case of Liens secured by the Collateral (i) such Lien expressly has a Lien priority junior to the Liens securing the Third Lien Notes and the related Third Lien Note Guarantees; or (ii) such Lien is a Permitted Lien; or

(2) in the case of Liens on any asset or property that is not Collateral, (i) the First Lien Notes (or a Guarantee in the case of Liens of a Guarantor) are equally and ratably secured or are secured with (or on a senior basis to, in the case such Lien secures any Junior Lien Debt or any Subordinated Obligation) the obligations secured by such Lien until such time as such obligations are no longer secured by a Lien or (ii) such Lien is a Permitted Lien.

(b) Any Lien created for the benefit of Holders pursuant to this Section 4.10 shall be automatically and unconditionally released and discharged, without any action on the part of the Holders, the Trustee or the Collateral Agent, upon the release and discharge of each of the related Liens described in clauses (1) and (2) of Section 4.10(a), as applicable.

Section 4.11. Future Guarantors.

(a) The Company shall cause each Restricted Subsidiary that is or from time to time becomes a borrower under the Bank Facility or that Guarantees the Obligations under the Bank Facility, the Second Lien Notes and the Third Lien Notes or that (x) Guarantees other Indebtedness of the Company or any Restricted Subsidiary or (y) Incurs any Indebtedness (other than intercompany Indebtedness owing to the Company or its Subsidiaries), in each case exceeding (i) $10.00 million in aggregate principal amount or (ii) together with all other Restricted Subsidiaries that do not Guarantee the First Lien Notes, $100.00 million in aggregate principal amount outstanding at any one time, to execute and deliver to the Trustee a supplemental indenture to this First Lien Indenture pursuant to which such Restricted Subsidiary will irrevocably and unconditionally Guarantee, on a joint and several basis, the full and prompt payment of the principal of, premium, if any, and interest in respect of the First Lien Notes on a senior basis and all other Obligations under this First Lien Indenture.

(b) The obligations of each Guarantor shall be limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Guarantor (including, without limitation, any Guarantees under the Bank Facility) and after giving effect to any collections from or payments made by or on behalf of any other Guarantor in respect of the Obligations of such other Guarantor under its Note Guarantee or pursuant to its contribution Obligations under this First Lien Indenture, result in the Obligations of such Guarantor under its Note Guarantee not constituting a fraudulent conveyance or fraudulent transfer under federal or state law.

(c) Each Note Guarantee shall be released in accordance with Section 10.06.

 

85

Section 4.12. Limitation on Restrictions on Distribution From Restricted Subsidiaries.

(a) The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or permit to exist or become effective any consensual encumbrance or consensual restriction on the ability of any Restricted Subsidiary to:

(1) pay dividends or make any other distributions on its Capital Stock to the Company or any other Restricted Subsidiary, or pay any Indebtedness owed to the Company or any other Restricted Subsidiary (it being understood that the priority of any Preferred Stock in receiving dividends or liquidating distributions prior to dividends or liquidating distributions being paid on Equity Interests shall not be deemed a restriction on the ability to make distributions on Capital Stock);

(2) make any loans or advances to the Company or any other Restricted Subsidiary (it being understood that the subordination of loans or advances made to the Company or any Restricted Subsidiary to other Indebtedness Incurred by the Company or any Restricted Subsidiary shall not be deemed a restriction on the ability to make loans or advances); or

(3) sell, lease or transfer any of its property or assets to the Company or any other Restricted Subsidiary (it being understood that such transfers shall not include any type of transfer described in clause (1) or (2) of this Section 4.12(a)).

(b) Section 4.12(a) shall not prohibit encumbrances or restrictions existing under or by reason of:

(1) contractual encumbrances or restrictions pursuant to the Bank Facility or the Existing Unsecured Notes and related documentation and other agreements or instruments in effect at or entered into on the Issue Date;

(2) this First Lien Indenture, the First Lien Notes, the Note Guarantees, the Security Documents, the First Lien/Second Lien/Third Lien Intercreditor Agreement, the Second Lien Indenture, the Second Lien Notes, the Second Lien Exchangeable Notes, the Second Lien Note Guarantees, the Third Lien Indenture, the Third Lien Notes, the Third Lien Exchangeable Notes and the Third Lien Note Guarantees;

(3) any agreement or other instrument of a Person acquired by or merged, consolidated or amalgamated with or into the Company or any Restricted Subsidiary in existence at the time of such acquisition or at the time it merges, consolidates or amalgamates with or into the Company or any Restricted Subsidiary (but, in each case, not created in contemplation thereof), which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person and its Subsidiaries, or the property or assets of the Person and its Subsidiaries, so acquired or merged, consolidated or amalgamated with and into the Company or Restricted Subsidiary, whichever is applicable;

(4) any amendment, restatement, modification, renewal, supplement, refunding, replacement or refinancing of an agreement referred to in clauses (1), (2) or (3) of this Section 4.12(b) or this clause (4); provided, however, that such amendments, restatements, modifications, renewals, supplements, refundings, replacements or refinancings are, in the good faith judgment of the Company, not materially more restrictive than the encumbrances and restrictions contained in the agreements referred to in clauses (1), (2) or (3) of this Section 4.12(b) on the Issue Date or the date such Person was acquired, merged, consolidated or amalgamated with and into the Company or any Restricted Subsidiary, whichever is applicable;

 

86

(5) in the case of Section 4.12(a)(3), Liens permitted to be Incurred under Section 4.10 that limit the right of the debtor to dispose of the assets securing such Indebtedness;

(6) purchase money obligations and Capitalized Lease Obligations permitted under this First Lien Indenture, in each case that impose encumbrances or restrictions of the nature described in Section 4.12(a)(3) on the property so acquired;

(7) any agreement for the sale or other disposition of all or a portion of the Capital Stock or assets of a Restricted Subsidiary with customary restrictions on distributions, transfers, loans or advances by that Restricted Subsidiary pending its sale or other disposition;

(8) restrictions on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business (whether or not consistent with past practice) or restrictions on cash or other deposits permitted under Section 4.10 or arising in connection with any Permitted Liens;

(9) any provisions in leases, subleases, licenses, sublicenses and other agreements entered into by the Company or any Restricted Subsidiary in the ordinary course of business (whether or not consistent with past practice);

(10) encumbrances or restrictions arising or existing by reason of applicable law or any applicable rule, regulation, order, approval, license, permit or similar restriction;

(11) any provisions in joint venture agreements and other similar agreements relating to joint ventures entered into in the ordinary course of business (whether or not consistent with past practice);

(12) restrictions in agreements or instruments which prohibit the payment or making of dividends or other distributions other than on a pro rata basis; and

(13) other Indebtedness Incurred or Preferred Stock permitted to be Incurred pursuant to Section 4.09; provided that, in the good faith judgment of the Company, (x) the encumbrances and restrictions in such Indebtedness are not materially more restrictive, taken as a whole, than those contained in this First Lien Indenture or (y) such encumbrance or restriction is no materially more disadvantageous to the holders of the First Lien Notes than is customary in comparable financings (as determined in the good faith judgment of the Company) and such encumbrance or restriction will not materially impair the Company’s ability to make principal or interest payments on the First Lien Notes when due.

Section 4.13. Designation of Restricted and Unrestricted Subsidiaries.

(a) The Company may designate after the Issue Date any Subsidiary (including any newly acquired or newly formed Subsidiary) as an “Unrestricted Subsidiary” under this First Lien Indenture (a “Designation”) only if:

(1) no Default or Event of Default shall have occurred and be continuing both immediately before and immediately after giving effect to such Designation;

 

87

(2) the Subsidiary to be so designated and its Subsidiaries do not at the time of Designation own any Capital Stock or Indebtedness of, or own or hold any Lien with respect to, the Company or any Restricted Subsidiary of the Company (other than any Subsidiary of the Subsidiary to be so designated);

(3) all the Indebtedness of such Subsidiary and its Subsidiaries shall, at the date of Designation, and will at all times thereafter, consist of Non-Recourse Debt;

(4) such Subsidiary is a Person with respect to which neither the Company nor any of its Restricted Subsidiaries has any direct or indirect obligation:

(i) to subscribe for additional Capital Stock of such Subsidiary; or

(ii) to maintain or preserve such Subsidiary’s financial condition or to cause such Subsidiary to achieve any specified levels of operating results;

(5) the aggregate Fair Market Value of all outstanding Investments owned by the Company and its Restricted Subsidiaries in the Subsidiary designated as an Unrestricted Subsidiary shall be deemed to be an Investment made as of the time of the Designation and must comply with Section 4.08; and

(6) the Required First Lien Noteholders have provided their prior written consent.

(b) The Company may revoke any Designation of a Subsidiary as an Unrestricted Subsidiary (a “Revocation”) only if, immediately after giving effect such Revocation:

(1) no Default or Event of Default has occurred and is continuing after giving effect to such Revocation;

(2) The Consolidated Leverage Ratio for the Company and its Restricted Subsidiaries would be better than or equal to such ratio for the Company and its Restricted Subsidiaries immediately prior to such Revocation, in each case on a pro forma basis taking into account such Revocation; and

(3) all Liens of such Unrestricted Subsidiary outstanding immediately following such Revocation would, if Incurred at such time, have been permitted to be Incurred for all purposes of this First Lien Indenture.

(c) Any such Designation or Revocation shall be evidenced to the Trustee by filing with the Trustee a certified copy of the resolution of the Board of Directors of the Company giving effect to such Designation or Revocation, as the case may be, and an Officer’s Certificate certifying that such Designation or Revocation complied with the foregoing conditions.

(d) A Revocation will be deemed to be an Incurrence of Indebtedness by a Restricted Subsidiary of any outstanding Indebtedness of such Unrestricted Subsidiary. If, at any time, any Unrestricted Subsidiary would fail to meet the foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this First Lien Indenture, and any Indebtedness of such Subsidiary shall be deemed to be Incurred as of such date.

 

88

Section 4.14. Transactions with Affiliates.

(a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into or conduct any transaction (including the purchase, sale, lease or exchange of any property or asset or the rendering of any service) with any Affiliate of the Company (an “Affiliate Transaction”) involving aggregate payments or consideration in excess of $10.00 million, unless:

(1) the terms of such Affiliate Transaction are not materially less favorable, when taken as a whole, to the Company or such Restricted Subsidiary, as the case may be, than those that could have been obtained by the Company or such Restricted Subsidiary in a comparable transaction at the time of such transaction in arms’-length dealings with a Person that is not an Affiliate, as determined by the Company in good faith; and

(2) in the event such Affiliate Transaction involves an aggregate consideration in excess of $25.0 million, the terms of such transaction have been approved by a majority of the disinterested members of the Board of Directors of the Company.

(b) Section 4.14(a) shall not apply to:

(1) any transaction between the Company and a Restricted Subsidiary or between or among Restricted Subsidiaries (or, in any case, any entity that becomes a Restricted Subsidiary as a result of such transaction) and any Guarantees issued by the Company or a Restricted Subsidiary for the benefit of the Company or a Restricted Subsidiary, as the case may be, in accordance with Section 4.09;

(2) Restricted Payments permitted to be made pursuant to Section 4.08 or Permitted Investments;

(3) transactions or payments pursuant to any employee, officer or director compensation or benefit plans, employment agreements, severance agreements or any similar arrangements entered into in the ordinary course of business (whether or not consistent with past practice) or approved by the Board of Directors of the Company;

(4) the payment of reasonable fees to, and indemnities and reimbursements provided on behalf of, current, future or former officers, directors, employees or consultants of the Company or any Restricted Subsidiary;

(5) loans, advances or Guarantees (or cancellation of loans, advances or Guarantees) to current, future or former officers, directors, employees or consultants of the Company or any Restricted Subsidiary that, in each case, are approved by a majority of the disinterested members of the Board of Directors of the Company;

(6) transactions effected pursuant to any agreement as in effect as of the Issue Date, as these agreements may be amended, modified, supplemented, extended or renewed from time to time, so long as any such amendment, modification, supplement, extension or renewal is not, in the good faith judgment of the Company, materially more disadvantageous to the Holders, when taken as a whole, than the terms of the agreements in effect on the Issue Date;

 

89

(7) any agreement between any Person and an Affiliate of such Person existing at the time such Person is acquired by or merged into the Company or a Restricted Subsidiary; provided that such agreement was not entered into in contemplation of such acquisition or merger, as these agreements may be amended, modified, supplemented, extended or renewed from time to time, so long as any such amendment, modification, supplement, extension or renewal is not, in the good faith judgment of the Company, materially more disadvantageous to the Holders, when taken as a whole, than the terms of the applicable agreement in effect on the date of such acquisition or merger;

(8) transactions with customers, clients, suppliers, contractors, joint venture partners or purchasers or sellers of goods or services, in each case in the ordinary course of business or that are consistent with past practice of the Company and its Restricted Subsidiaries and otherwise in compliance with the terms of this First Lien Indenture;

(9) any grant, issuance or sale of Capital Stock (other than Disqualified Stock) to Affiliates of the Company and the granting of registration and other customary rights in connection therewith;

(10) transactions in which the Company or any of its Restricted Subsidiaries, as the case may be, delivers to the Trustee a letter from an accounting, appraisal or investment banking firm stating that such transaction is fair to the Company or such Restricted Subsidiary from a financial point of view or stating that the terms are not materially less favorable, when taken as a whole, to the Company or the relevant Restricted Subsidiary than those that could have been obtained by the Company or the relevant Restricted Subsidiary in a comparable transaction at the time of such transaction in arms’-length dealings with a Person that is not an Affiliate;

(11) transactions with Affiliates solely in their capacity as holders of Indebtedness or Equity Interests of the Company, where such Affiliates receive the same consideration as non-Affiliates in such transaction;

(12) transactions with any joint venture in which the Company or any Restricted Subsidiary holds or acquires an ownership interest in the ordinary course of business (whether or not consistent with past practice) so long as the terms of any such transactions, in the good faith judgment of the Company, are not materially less favorable, taken as a whole, to the Company or such Restricted Subsidiary than they are to the other joint venture partners;

(13) [reserved];

(14) any purchases by the Company’s Affiliates of Indebtedness or Disqualified Stock of the Company or any of the Restricted Subsidiaries the majority of which Indebtedness or Disqualified Stock is purchased by Persons who are not the Company’s Affiliates; provided that such purchases by the Company’s Affiliates are on the same terms as such purchases by such Persons who are not the Company’s Affiliates; and

 

90

(15) (i) investments by Affiliates in securities or loans of the Company or any of the Restricted Subsidiaries (and payment of reasonable out-of-pocket expenses Incurred by such Affiliates in connection therewith) so long as the investment is being offered by the Company or such Restricted Subsidiary generally to other non-affiliated third party investors on the same or more favorable terms and (ii) payments to Affiliates in respect of securities or loans of the Company or any of the Restricted Subsidiaries contemplated in the foregoing subclause (i) or that were acquired from Persons other than the Company and its Restricted Subsidiaries, in each case, in accordance with the terms of such securities or loans.

Section 4.15. Offer to Repurchase Upon Change of Control.

(a) If a Change of Control occurs, unless the Company has exercised its right to redeem all of the First Lien Notes pursuant to Section 3.07, the Company shall make an offer to purchase all of the First Lien Notes (the “Change of Control Offer”) at a purchase price in cash equal to 101% of the principal amount of the First Lien Notes plus accrued and unpaid interest, if any, to but not including the date of purchase (the “Change of Control Payment”), subject to the right of Holders of record on a Record Date to receive any interest due on the Change of Control Payment Date (as defined below).

(b) Within 30 days following any Change of Control, unless the Company has exercised its right to redeem all of the First Lien Notes pursuant to Section 3.07, the Company shall mail a notice of such Change of Control Offer to each Holder or otherwise deliver notice in accordance with the applicable procedures of DTC, with a copy to the Trustee, stating:

(1) that a Change of Control Offer is being made, the expiration time for such Change of Control Offer (which shall be no earlier than 10 days nor later than the earlier of 60 days from the date (A) such notice is mailed or otherwise delivered in accordance with the applicable procedures of DTC and (B) of consummation of the applicable Change of Control) and that all First Lien Notes properly tendered pursuant to such Change of Control Offer will be accepted for purchase by the Company at a purchase price in cash equal to 101% of the principal amount of such First Lien Notes plus accrued and unpaid interest, if any, to but not including the date of purchase (subject to the right of Holders of record on the applicable Record Date to receive interest due on the Change of Control Payment Date);

(2) the purchase date (which shall be no later than five Business Days after the date such Change of Control Offer expires) (the “Change of Control Payment Date”); and

(3) the procedures determined by the Company, consistent with this First Lien Indenture, that a Holder must follow in order to have its First Lien Notes repurchased.

On the Change of Control Payment Date, the Company shall, to the extent lawful:

(1) accept for payment all First Lien Notes or portions of First Lien Notes (in integral multiples of $1.00) properly tendered pursuant to the Change of Control Offer; provided that if, following repurchase of a portion of a First Lien Note, the remaining principal amount of such First Lien Note outstanding immediately after such repurchase would be less than $1.00, then the portion of such First Lien Note so repurchased shall be reduced so that the remaining principal amount of such First Lien Note outstanding immediately after such repurchase is $1.00;

 

91

(2) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all First Lien Notes or portions of First Lien Notes so tendered; and

(3) deliver or cause to be delivered to the Trustee for cancellation the First Lien Notes so accepted together with an Officer’s Certificate directing the Trustee to cancel the applicable First Lien Notes and stating the aggregate principal amount of First Lien Notes or portions of First Lien Notes being purchased by the Company in accordance with the terms of this Section 4.15.

(c) The Paying Agent will promptly mail (or otherwise deliver in accordance with the applicable procedures of DTC) to each Holder of First Lien Notes so tendered the Change of Control Payment for such First Lien Notes, and the Trustee will promptly authenticate and mail (or otherwise deliver in accordance with the applicable procedures of DTC) (or cause to be transferred by book entry) to each Holder a new First Lien Note (it being understood that, notwithstanding anything in this First Lien Indenture to the contrary, no Opinion of Counsel or Officer’s Certificate, only an Authentication Order, shall be required for the Trustee to authenticate and mail or deliver such new First Lien Note) equal in principal amount to any unpurchased portion of the First Lien Notes surrendered, if any; provided that each such new First Lien Note will be in a minimum principal amount of $1.00 or integral multiples of $1.00 in excess thereof.

(d) If the Change of Control Payment Date is on or after a Record Date and on or before the related Interest Payment Date, any accrued and unpaid interest to the Change of Control Payment Date will be paid on the Change of Control Payment Date to the Person in whose name a First Lien Note is registered at the close of business on such Record Date.

(e) The Company shall not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this First Lien Indenture applicable to a Change of Control Offer made by the Company and purchases all First Lien Notes validly tendered and not withdrawn under such Change of Control Offer.

(f) To the extent that the provisions of any securities laws or regulations conflict with provisions of this First Lien Indenture, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this First Lien Indenture by virtue of the conflict.

Section 4.16. Asset Dispositions.

(a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, consummate any Asset Disposition unless:

(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration at least equal to the Fair Market Value (such Fair Market Value to be determined on the date of contractually agreeing to such Asset Disposition) of the shares and assets subject to such Asset Disposition; and

 

92

(2) at least 75% of the consideration from such Asset Disposition received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; provided that the requirement in this clause (2) shall not apply to (x) any Asset Swap or (y) the sale or issuance by a Foreign Subsidiary of Equity Interests in the ordinary course of business (whether or not consistent with past practice) to directors, employees, management, consultants or advisors of such Foreign Subsidiary in connection with agreements to compensate such persons approved by a majority of the disinterested members of the Board of Directors of such Foreign Subsidiary.

For the purposes of clause (2) above and for no other purpose, the following shall be deemed to be cash:

(1) any liabilities (as shown on the Company’s consolidated balance sheet, or if Incurred, accrued or increased subsequent to the date of such balance sheet, such liabilities that would have been reflected on the Company’s consolidated balance sheet if such Incurrence, accrual or increase had taken place on or prior to the date of such balance sheet, as determined by the Company in good faith) of the Company or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the First Lien Notes or the Note Guarantees) that are assumed by the transferee of any such assets in writing or are otherwise extinguished in connection with the transactions relating to such Asset Disposition and from which the Company and all Restricted Subsidiaries no longer have any obligations with respect to such liabilities or are indemnified against further liabilities;

(2) any securities, notes or other obligations received by the Company or any Restricted Subsidiary in such Asset Disposition that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents (to the extent of the cash or Cash Equivalents received) within 90 days following the closing of such Asset Disposition; and

(3) any Designated Non-cash Consideration received by the Company or any Restricted Subsidiary in such Asset Disposition having an aggregate Fair Market Value that, when taken together with all other Designated Non-cash Consideration previously received pursuant to this clause (3) that is at that time outstanding, does not exceed $20.00 million (with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value).

(b) Within 300 days from the receipt of such Net Available Cash, an amount equal to 100% of the Net Available Cash from such Asset Disposition may be applied by the Company or any Restricted Subsidiary as follows:

(1) to repay the Notes Obligations of the Company or a Guarantor to the extent such Notes Obligations were Incurred under Section 4.09(b)(1) through open market purchases or by redemption;

(2) up to $500.00 million in the aggregate to invest in Additional Assets or to make capital expenditures in or that are useful in a Permitted Business; or

(3) any combination of the foregoing;

provided that pending the final application of any such Net Available Cash in accordance with clause (1), (2) or (3) above, the Company and its Restricted Subsidiaries may temporarily reduce Indebtedness (including under a revolving Debt Facility) or otherwise invest such Net Available Cash in any manner not prohibited by this First Lien Indenture; provided, further, that in the case of clause (2) above, a binding commitment to invest in Additional Assets or to make a capital

 

93

expenditure shall be treated as a permitted application of the Net Available Cash from the date of such commitment so long as the Company or a Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Available Cash will be applied to satisfy such commitment within 90 days of the end of such 300-day period and such Net Available Cash is actually applied in such manner within 90 days from the end of such 300-day period.

To the extent that the Company uses such Net Available Cash in accordance with Section 4.16(b)(1) to redeem the First Lien Notes, the Company shall redeem the Notes Obligations of each Series of First Lien Notes on a pro rata basis based on the aggregate principal amount of Series I First Lien Notes, Series II First Lien Notes and Series III First Lien Notes outstanding at such time, subject to DTC’s applicable procedures.

(c) Any Net Available Cash from Asset Dispositions that is not applied or invested as provided in Section 4.16(b) will be deemed to constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $25.00 million, the Company shall be required to make an offer (an “Asset Disposition Offer”) to all Holders and, to the extent required by the terms of any outstanding Parity Lien Obligations, to all holders of such Parity Lien Obligations, to purchase the maximum aggregate principal amount of First Lien Notes and any such Parity Lien Obligations that may be purchased out of the Excess Proceeds, at an offer price in cash in an amount equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase (subject to the right of Holders of record on a record date to receive interest due on the Asset Disposition Purchase Date) in accordance with the procedures set forth in this First Lien Indenture or the agreements governing the Parity Lien Obligations, as applicable, in the case of the First Lien Notes in integral multiples of $1.00; provided that if, following repurchase of a portion of a First Lien Note, the remaining principal amount of such First Lien Note outstanding immediately after such repurchase would be less than $1.00, then the portion of such First Lien Note so repurchased shall be reduced so that the remaining principal amount of such First Lien Note outstanding immediately after such repurchase is $1.00. The Company shall commence an Asset Disposition Offer with respect to Excess Proceeds by mailing (or otherwise communicating in accordance with the applicable procedures of DTC) the notice required pursuant to the terms of this First Lien Indenture, with a copy to the Trustee. To the extent that the aggregate amount of First Lien Notes and Parity Lien Obligations validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds in any manner not otherwise prohibited by this First Lien Indenture. If the aggregate principal amount of First Lien Notes and Parity Lien Obligations validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Trustee shall select the First Lien Notes and such Parity Lien Obligations to be purchased on a pro rata basis on the basis of the aggregate accreted value or principal amount of tendered First Lien Notes and Parity Lien Obligations; provided that the selection of such Parity Lien Obligations shall be made pursuant to the terms of such Parity Lien Obligations. Upon completion of such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.

(d) The Company shall not, and shall not permit any Restricted Subsidiary to, engage in any Asset Swaps unless, at the time of entering into such Asset Swap and immediately after giving effect to such Asset Swap, no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof.

 

94

(e) To the extent that the provisions of any securities laws or regulations conflict with provisions of this First Lien Indenture, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under this First Lien Indenture by virtue of any conflict.

Section 4.17. [Reserved].

Section 4.18. Maintenance of Property; Insurance.

Other than with respect to the transactions permitted pursuant to Section 4.16 and Sale/Leaseback Transactions permitted by this First Lien Indenture, the Company shall and shall cause each of its Restricted Subsidiaries to (A) keep all property useful and necessary in its business in good working order and condition, ordinary wear and tear excepted and (B) maintain with financially sound and reputable insurance companies insurance on all its property in at least such amounts and against at least such risks (but including in any event public liability, product liability and business interruption) as are usually insured against in the same general area by companies engaged in the same or a similar business.

Section 4.19. After-Acquired Collateral.

(a) From and after the Issue Date, if the Company, the Co-Obligor or any Guarantor creates any additional security interest upon any property or asset required to constitute Collateral to secure any Parity Lien Debt other than the First Lien Notes on a first priority basis (subject to Permitted Liens), it shall concurrently grant a first-priority security interest (subject to Permitted Liens) upon such property as security for the First Lien Notes and the other Obligations under this First Lien Indenture.

(b) The Company shall cause each Restricted Subsidiary, upon execution and delivery to the Trustee of a supplemental indenture substantially in the form of Exhibit C hereto, to become a party to the Security Documents, as applicable, and to execute and file all documents and instruments necessary (as determined by the Company) to grant to the Collateral Agent, for the benefit of the Holders, the Trustee and the Collateral Agent, a perfected security interest in the Collateral of such Restricted Subsidiary, in each case solely to the extent required by this First Lien Indenture and the Security Documents.

Section 4.20. Limitation on Material Intellectual Property Dispositions.

Without the prior written consent of the Required First Lien Noteholders, the Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, enter into or conduct any transaction (including, but not limited to, the purchase, sale, lease or exchange of any property or asset, the making of any Restricted Payment or Investment or the disposition of any assets) with any Unrestricted Subsidiary, partnership, joint venture or similar entity (i) in the form of transferring legal title to, or licensing on an exclusive basis, as applicable, intellectual property that, at the time of making such transaction, constitutes Material Intellectual Property or (ii) in furtherance of the Incurrence or refinancing of Indebtedness for borrowed money of the Company or its Restricted Subsidiaries.

Section 4.21. Asset Dispositions by Unrestricted Subsidiaries and WeWork Japan GK.

In the event that an Unrestricted Subsidiary or WeWork Japan GK makes any Unrestricted Subsidiary Asset Disposition, the Company and its Restricted Subsidiaries shall, subject to applicable law, use their reasonable best efforts to cause the net cash proceeds of such disposition to be transferred or contributed to the Company or any Restricted Subsidiary. An

 

95

Unsecured Subsidiary Asset Disposition shall constitute an Asset Disposition hereunder as of the date to the extent applicable net cash proceeds are transferred or contributed to the Company or a Restricted Subsidiary (as applicable) and shall be subject to the restrictions and obligations set forth under Section 4.16(c). If any net cash proceeds from an Unrestricted Subsidiary Asset Disposition with respect to assets of WeWork Japan GK or its subsidiaries are not transferred or contributed to the Company or any Restricted Subsidiary, the amount set forth in Section 4.16(b)(2) shall be reduced by the amount of such net cash proceeds.

Section 4.22. Ratings.

The Company shall use its best efforts to obtain a rating for the First Lien Notes from Moody’s, Standard & Poor’s or Fitch promptly following the Issue Date. Following the first day the First Lien Notes have been rated by any one of Moody’s, Standard & Poor’s or Fitch then, beginning on that day and continuing thereafter, the Company will not be subject to this Section 4.22. In addition, notwithstanding anything to the contrary herein, failure to comply with this Section 4.22 shall not constitute an Event of Default, including with respect to Section 6.01.

ARTICLE 5

SUCCESSORS

Section 5.01. Merger, Consolidation or Sale of All or Substantially All Assets.

(a) WeWork Inc. shall not consolidate with or merge with or into or wind up into (whether or not the WeWork Inc. is the surviving corporation), or sell, assign, convey, transfer, lease or otherwise dispose of all or substantially all of the properties and assets of WeWork Inc., taken as a whole, in one or more related transactions, to any Person unless:

(1) the resulting, surviving or transferee Person (the “Successor Parent”) is a corporation or limited liability company organized and existing under the laws of the United States, any state thereof or the District of Columbia;

(2) the Successor Parent (if other than the WeWork) expressly assumes all of the obligations of the WeWork Inc. under the First Lien Notes and this First Lien Indenture pursuant to a supplemental indenture or other documents or instruments in form reasonably satisfactory to the Trustee;

(3) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing; and

(4) WeWork Inc. or, if applicable, the Successor Parent shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger, winding up or disposition, and such supplemental indenture, if any, comply with this First Lien Indenture.

(b) The Successor Parent will succeed to, and be substituted for, WeWork Inc. under this First Lien Indenture, the Parent Guarantee and the First Lien Notes, as applicable, and WeWork Inc. will automatically be released and discharged from its obligations under this First Lien Indenture, the Parent Guarantee and the First Lien Notes, as applicable.

(c) Notwithstanding the foregoing, WeWork Inc. may consolidate with or merge with or into the Company or any other Guarantor that is a Domestic Subsidiary.

 

96

(d) The Company shall not consolidate with or merge with or into or wind up into (whether or not the Company is the surviving corporation), or sell, assign, convey, transfer, lease or otherwise dispose of all or substantially all of the properties and assets of the Company and its Restricted Subsidiaries, taken as a whole, in one or more related transactions, to any Person unless:

(1) the resulting, surviving or transferee Person (the “Successor Company”) is a corporation or limited liability company organized and existing under the laws of the United States, any state thereof or the District of Columbia, and if such entity is not a corporation, a co-obligor of the First Lien Notes is a corporation organized or existing under such laws;

(2) the Successor Company (if other than the Company) expressly assumes all of the obligations of the Company under the First Lien Notes, this First Lien Indenture and the Security Documents pursuant to a supplemental indenture or other documents or instruments in form reasonably satisfactory to the Trustee;

(3) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing;

(4) immediately after giving pro forma effect to such transaction and any related financing transactions, as if such transactions had occurred at the beginning of the applicable four-quarter period, the Consolidated Leverage Ratio for the Successor Company and its Restricted Subsidiaries would be better than or equal to such ratio for the Company and its Restricted Subsidiaries immediately prior to such transaction;

(5) each Guarantor (unless it is the other party to the transactions described above, in which case Section 5.01(f)(1) shall apply) shall have by supplemental indenture confirmed that its Note Guarantee shall apply to such Successor Company’s obligations under this First Lien Indenture, the First Lien Notes and the Security Documents; and

(6) the Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger, winding up or disposition, and such supplemental indenture, if any, comply with this First Lien Indenture.

(e) Notwithstanding clauses (3) and (4) of Section 5.01(d):

(1) any Restricted Subsidiary may consolidate with, merge with or into or transfer all or part of its properties and assets to the Company or any other Restricted Subsidiary provided that such surviving Restricted Subsidiary shall be a Domestic Subsidiary; and

(2) the Company may merge with an Affiliate of the Company solely for the purpose of reincorporating or forming the Company in another state of the United States or the District of Columbia, so long as the amount of Indebtedness of the Company and its Restricted Subsidiaries is not increased thereby.

 

97

(f) The Company shall not permit any Guarantor that is a Subsidiary of the Company to consolidate with or merge with or into or wind up into (whether or not such Guarantor is the surviving corporation), or sell, assign, convey, transfer, lease or otherwise dispose of all or substantially all of its properties and assets, in one or more related transactions, to any Person (other than to the Company or another Guarantor) unless:

(1) (a) if such entity remains a Guarantor, the resulting, surviving or transferee Person (the “Successor Guarantor”) is a Person (other than an individual) organized and existing under the laws of the United States, any state thereof or the District of Columbia or the laws under which such Guarantor was formed;

(b) the Successor Guarantor, if other than such Guarantor, expressly assumes all the obligations of such Guarantor under this First Lien Indenture, the First Lien Notes, its Note Guarantee and the Security Documents pursuant to a supplemental indenture or other documents or instruments in form reasonably satisfactory to the Trustee;

(c) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing; and

(d) the Company will have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger, winding up or disposition and such supplemental indenture (if any) comply with this First Lien Indenture; or

(2) in the event the transaction results in the release of the Restricted Subsidiary’s Note Guarantee under clause (1)(A) of Section 10.06(a), the transaction is made in compliance with Section 4.16 (it being understood that only such portion of the Net Available Cash as is required to be applied on the date of such transaction in accordance with the terms of this First Lien Indenture needs to be applied in accordance therewith at such time).

(g) Notwithstanding the foregoing, any Guarantor may merge with or into or transfer all or part of its properties and assets to a Guarantor or merge with a Restricted Subsidiary of the Company, so long as the resulting entity remains or becomes a Guarantor and such resulting entity shall be a Domestic Subsidiary.

(h) For purposes of this Section 5.01, the sale, assignment, conveyance, transfer, lease or other disposition of all or substantially all of the properties and assets of one or more Subsidiaries of the Company or a Guarantor, as the case may be, which properties and assets, if held by the Company or such Guarantor instead of such Subsidiaries, would constitute all or substantially all of the properties and assets of the Company or such Guarantor on a consolidated basis, will be deemed to be the disposition of all or substantially all of the properties and assets of the Company or such Guarantor, as applicable.

Section 5.02. Successor Entity Substituted.

Upon any consolidation, merger, winding up, sale, assignment, conveyance, transfer, lease or other disposition of all or substantially all of the assets of the Company or a Guarantor in accordance with Section 5.01, the Company or the Guarantor, as the case may be, shall be released from its obligations under this First Lien Indenture and the First Lien Notes or its Note Guarantee, as the case may be, and the Successor Company or the Successor Guarantor, as the case may be, shall succeed to, and be substituted for, and may exercise every right and power of, the Company or a Guarantor, as the case may be, under this First Lien Indenture, the First Lien Notes and such Note Guarantee; provided that, in the case of a lease of all or substantially all its assets, the Company shall not be released from the obligation to pay the principal of and interest on the First Lien Notes.

 

98

ARTICLE 6

DEFAULTS AND REMEDIES

Section 6.01. Events of Default.

(a) Each of the following is an “Event of Default”:

(1) default in any payment of interest on any First Lien Note when due, continued for 30 days;

(2) default in the payment of principal or premium, if any, on any First Lien Note when due at its Stated Maturity, upon optional redemption, upon required repurchase, upon declaration or otherwise;

(3) failure by the Company or any Guarantor to comply with its obligations under Section 5.01;

(4) failure by the Company or any Guarantor to comply for 30 days after notice as provided below with any of their obligations under Section 4.15 or Section 4.16 (in each case, other than a failure to purchase First Lien Notes, which constitutes an Event of Default under clause (2) above);

(5) failure by the Company or any Guarantor to comply for 60 days after notice as provided below with its other agreements contained in this First Lien Indenture, the First Lien Notes or the Note Guarantees (other than Section 4.22);

(6) default under any mortgage, indenture or instrument under which there is issued or by which there is secured or evidenced any Indebtedness for money borrowed (which, for the avoidance of doubt, shall not include Indebtedness described in clause (5) of the definition thereof or Non-Recourse Debt) by the Company or any of its Restricted Subsidiaries (or the payment of which is Guaranteed by the Company or any of its Restricted Subsidiaries), other than Indebtedness owed to the Company or a Restricted Subsidiary, whether such Indebtedness or Guarantee now exists or is created after the Issue Date, which default:

(i) is caused by a failure to pay principal of, or interest or premium, if any, on such Indebtedness prior to the expiration of the grace period provided in such Indebtedness;

(ii) results in the acceleration of such Indebtedness prior to its maturity; or

(iii) is caused by any Event of Default under the Letter of Credit Facility or any other Material Indebtedness following the expiration of the grace period provided thereunder,

 

99

and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a payment default or the maturity of which has been so accelerated, aggregates $50.00 million or more (or its foreign currency equivalent);

(7) failure by the Company or any Significant Subsidiary or any group of Restricted Subsidiaries that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary to pay final, non-appealable judgments aggregating in excess of $50.00 million (or its foreign currency equivalent) (net of any amounts that a reputable and creditworthy insurance company, as determined by the Company in good faith, has acknowledged liability for in writing), which judgments are not paid, discharged or stayed for a period of 60 days or more after such judgment becomes final;

(8) (i) the Company or a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary, pursuant to or within the meaning of any Bankruptcy Law:

(A) commences proceedings to be adjudicated bankrupt or insolvent;

(B) consents to the institution of bankruptcy or insolvency proceedings against it, or the filing by it of a petition or answer or consent seeking an arrangement of debt, reorganization, dissolution, winding up or relief under applicable Bankruptcy Law;

(C) consents to the appointment of a receiver, interim receiver, receiver and manager, liquidator, assignee, trustee, sequestrator or other similar official of it or for all or substantially all of its property;

(D) makes a general assignment for the benefit of its creditors; or

(E) admits in writing its inability to pay its debts generally as they become due; or

(ii) a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

(A) is for relief against the Company, any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary, in a proceeding in which the Company, any such Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary, is to be adjudicated bankrupt or insolvent;

 

100

(B) appoints a receiver, interim receiver, receiver and manager, liquidator, assignee, trustee, sequestrator or other similar official of the Company, any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary, or for all or substantially all of the property of the Company, any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary; or

(C) orders the liquidation, dissolution or winding up of the Company, or any Restricted Subsidiary that is a Significant Subsidiary or any group of Restricted Subsidiaries that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary;

and the order or decree remains unstayed and in effect for 60 consecutive days;

(9) any Note Guarantee of a Significant Subsidiary or any group of Guarantors that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary ceases to be in full force and effect (except as contemplated by the terms of this First Lien Indenture) or is declared null and void in a judicial proceeding or any Guarantor that is a Significant Subsidiary or any group of Guarantors that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary denies or disaffirms its obligations under this First Lien Indenture or its Note Guarantee (other than by release of any such Guarantee as contemplated by the terms of this First Lien Indenture);

(10) unless such Liens have been released in accordance with the provisions of Article 12, the Security Documents or the First Lien/Second Lien/Third Lien Intercreditor Agreement, the Liens in favor of the Holders with respect to any Collateral having a Fair Market Value in excess of $50.00 million cease to be valid or enforceable and such Default continues for 30 days, or the Company shall assert or any Guarantor shall assert, in any pleading in any court of competent jurisdiction, that any security interest with respect to any Collateral having a Fair Market Value in excess of $50.00 million is invalid or unenforceable (except as contemplated by the terms of this First Lien Indenture, the Security Documents or the First Lien/Second Lien/Third Lien Intercreditor Agreement) and, in the case of any Guarantor, the Company shall fail to cause such Guarantor to rescind such assertions within 30 days after the Company has actual knowledge of such assertions;

(11) failure by the Company or any Guarantor to comply for 60 days after notice as provided below or such longer period as may be provided in the Security Documents with its other agreements contained in the Security Documents, in each case, except for a failure that would not be material to the Holders and would not materially affect the value of the Collateral taken as a whole; or

 

101

(12) the parties to the Credit Agreement waive or permanently forbear from exercising rights or remedies, or amend or modify any term or provision of the Credit Documents or the Parent Indemnity, that obligate the SVF Obligor or any other SBG entity to prepay, reimburse or cash collateralize the obligations of the Company and the SVF Obligor under the Credit Agreement in accordance with Sections 11.1 or 11.2 of the Credit Agreement or the Parent Indemnity without the written consent of the Required Secured Noteholders.

(b) A Default under clauses (4) and (5) of Section 6.01(a) shall not constitute an Event of Default with respect to any Series of First Lien Notes until the Trustee or the Holders of at least 25% in principal amount of such Series of First Lien Notes then outstanding notify the Company of the Default and the Company does not cure such Default within the time specified in clauses (4) and (5) of Section 6.01(a) after receipt of such notice; provided that a notice of Default may not be given with respect to any action taken, and reported publicly or to Holders, more than two years prior to such notice of Default. Any notice of Default, notice of acceleration or instruction to the Trustee to provide a notice of Default, notice of acceleration or take any other action (a “Noteholder Direction”) provided by any one or more Holders (each a “Directing Holder”) must be accompanied by a written representation from each such Holder delivered to the Company and the Trustee that such Holder is not (or, in the case such Holder is DTC or its nominee, that such Holder is being instructed solely by beneficial owners that are not) Net Short (a “Position Representation”), which representation, in the case of a Noteholder Direction relating to the delivery of a notice of Default shall be deemed a continuing representation until the resulting Event of Default is cured or otherwise ceases to exist or the First Lien Notes are accelerated. In addition, each Directing Holder is deemed, at the time of providing a Noteholder Direction, to covenant to provide the Company with such other information as the Company may reasonably request from time to time in order to verify the accuracy of such Noteholder’s Position Representation within five Business Days of request therefor (a “Verification Covenant”). In any case in which the Holder is DTC or its nominee, any Position Representation or Verification Covenant required hereunder shall be provided by the beneficial owner of the First Lien Notes in lieu of DTC or its nominee and DTC shall be entitled to conclusively rely on such Position Representation and Verification Covenant in delivering its direction to the Trustee.

(c) If, following the delivery of a Noteholder Direction, but prior to acceleration of the First Lien Notes, the Company determines in good faith that there is a reasonable basis to believe a Directing Holder was, at any relevant time, in breach of its Position Representation and provides to the Trustee an Officer’s Certificate stating that the Company has initiated litigation in a court of competent jurisdiction seeking a determination that such Directing Holder was, at such time, in breach of its Position Representation, and seeking to invalidate any Default, Event of Default or acceleration (or notice thereof) that resulted from the applicable Noteholder Direction, the cure period with respect to such Default shall be automatically stayed and the cure period with respect to such Default or Event of Default shall be automatically reinstituted and any remedy stayed pending a final and non-appealable determination of a court of competent jurisdiction on such matter. If, following the delivery of a Noteholder Direction, but prior to acceleration of the First Lien Notes, the Company provides to the Trustee an Officer’s Certificate stating that a Directing Holder failed to satisfy its Verification Covenant, the cure period with respect to such Default shall be automatically stayed and the cure period with respect to any Default or Event of Default that resulted from the applicable Noteholder Direction shall be automatically reinstituted and any remedy stayed pending satisfaction of such Verification Covenant. Any breach of the Position Representation shall result in such Holder’s participation in such Noteholder Direction being disregarded; and, if, without the participation of such Holder, the percentage of First Lien Notes held by the remaining Holders that provided such Noteholder Direction would have been insufficient to validly provide such Noteholder Direction, such Noteholder Direction shall be void ab initio, with the effect that such Default or Event of Default shall be deemed never to have occurred, acceleration voided and the Trustee shall be deemed not to have received such Noteholder Direction or any notice of such Default or Event of Default. The Trustee shall have no liability or responsibility to any Person for acting (or refraining from acting) in reliance on an Officer’s Certificate.

 

102

(d) Notwithstanding anything in Section 6.01(b) and Section 6.01(c)to the contrary, any Noteholder Direction delivered to the Trustee during the pendency of an Event of Default as the result of a bankruptcy or similar proceeding shall not require compliance with the foregoing paragraphs.

(e) For the avoidance of doubt, the Trustee shall be entitled to conclusively rely on any Noteholder Direction delivered to it in accordance with this First Lien Indenture, shall have no duty to inquire as to or investigate the accuracy of any Position Representation, enforce compliance with any Verification Covenant, verify any statements in any Officer’s Certificate delivered to it, or otherwise make calculations, investigations or determinations with respect to Derivative Instruments, Net Shorts, Long Derivative Instruments, Short Derivative Instruments or otherwise. The Trustee shall have no responsibility or liability to the Company, any Holder or any other Person in acting in good faith on a Noteholder Direction or in connection with any Position Representation or Verification Covenant or in connection with any information set forth therein.

Section 6.02. Acceleration.

(a) If an Event of Default (other than an Event of Default described in Section 6.01(a)(8)) occurs and is continuing, the Trustee, upon its actual notice of such Event of Default, by written notice to the Company, specifying the Event of Default, or the Holders of at least 25% in principal amount of any Series of First Lien Notes then outstanding by notice to the Company and the Trustee, may, and the Trustee at the request of such Holders shall, declare the principal of, premium, if any, and accrued and unpaid interest, if any, on all the then outstanding First Lien Notes to be due and payable, with respect to such Series of First Lien Notes only. Upon such a declaration, such principal, premium, if any, and accrued and unpaid interest, if any, will be due and payable immediately.

(b) In case an Event of Default described in Section 6.01(a)(8) occurs and is continuing, the principal of, premium, if any, and accrued and unpaid interest, if any, on all the then outstanding First Lien Notes will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.

(c) In the event of a declaration of acceleration of the First Lien Notes because an Event of Default described in Section 6.01(a)(6) has occurred and is continuing, the declaration of acceleration of the First Lien Notes shall be automatically annulled if:

(1) the default triggering such Event of Default pursuant to Section 6.01(a)(6) shall be remedied or cured by the Company or a Restricted Subsidiary (including through a discharge of such Indebtedness) or waived by the holders of the relevant Indebtedness within 20 days after the declaration of acceleration with respect thereto; and

(2) (A) the annulment of the acceleration of the First Lien Notes would not conflict with any judgment or decree of a court of competent jurisdiction and (B) all existing Events of Default, except nonpayment of principal of, premium, if any, or interest on, the First Lien Notes that became due solely because of the acceleration of the First Lien Notes, have been cured or waived.

 

103

(d) Upon the occurrence and during the continuation of an Event of Default described in Section 6.01(a)(1) or (2), the Issuers will be required to pay cash interest on overdue installments of principal and interest at 2.000% per annum in excess of the cash interest rate.

(e) Upon the First Lien Notes of any Series becoming due and payable upon any Event of Default, whether automatically or by declaration, such First Lien Notes (together with accrued and unpaid interest thereon) of such Series will immediately become due and payable (the date thereof, the “Relevant Date”) and (i) if the Relevant Date occurs prior to November 1, 2024, the Applicable Premium that would have been payable upon an optional redemption of the First Lien Notes on the Relevant Date or (ii) if the Relevant Date occurs on or after November 1, 2024 (and prior to August 15, 2027), the redemption premium that would have been payable upon an optional redemption of the First Lien Notes on the Relevant Date as set forth under Section 3.07 shall, in either case, also be immediately due and payable on the Relevant Date.

(f) Without limiting the generality of the foregoing, it is understood and agreed that if the First Lien Notes are accelerated as a result of any Event of Default described in Section 6.01(a)(8), any Applicable Premium with respect to an optional redemption of the First Lien Notes will also be due and payable as though the First Lien Notes were optionally redeemed and shall constitute part of the First Lien Notes obligations, in view of the impracticability and extreme difficulty of ascertaining actual damages and by mutual agreement of the parties as to a reasonable calculation of each Holder’s lost profits as a result thereof. Any premium (including the Applicable Premium) payable above shall be presumed to be the liquidated damages sustained by each holder as the result of the early redemption and the Issuer agrees that it is reasonable under the circumstances currently existing. The premium (including the Applicable Premium) shall also be payable in the event the First Lien Notes (and/or this First Lien Indenture) are satisfied or released by foreclosure (whether by power of judicial proceeding), deed in lieu of foreclosure or by any other means. EACH ISSUER EXPRESSLY WAIVES (TO THE FULLEST EXTENT IT MAY LAWFULLY DO SO) THE PROVISIONS OF ANY PRESENT OR FUTURE STATUTE OR LAW THAT PROHIBITS OR MAY PROHIBIT THE COLLECTION OF THE FOREGOING PREMIUM (INCLUDING THE APPLICABLE PREMIUM) IN CONNECTION WITH ANY SUCH ACCELERATION. Each Issuer expressly agrees (to the fullest extent it may lawfully do so) that:

(1) the premium (including the Applicable Premium) is reasonable and is the product of an arm’s length transaction between sophisticated business people, ably represented by counsel;

(2) the premium (including the Applicable Premium) shall be payable notwithstanding the then prevailing market rates at the time payment is made;

(3) there has been a course of conduct between holders and the Issuer giving specific consideration in this transaction for such agreement to pay the premium (including the Applicable Premium); and

(4) the Issuer shall be estopped hereafter from claiming differently than as agreed to in this paragraph. The Issuer expressly acknowledges that its agreement to pay the premium (including the Applicable Premium) to Holders as herein described is a material inducement to holders to purchase the First Lien Notes.

 

104

(g) The Holders of a majority in principal amount of the outstanding First Lien Notes of any Series may waive all past Defaults and Events of Default (except with respect to nonpayment of principal, premium or interest) and rescind any acceleration with respect to the First Lien Notes of such Series and its consequences if (1) such rescission would not conflict with any judgment or decree of a court of competent jurisdiction and (2) all existing Events of Default, other than the nonpayment of the principal of, premium, if any, and interest on, the First Lien Notes that have become due solely by such declaration of acceleration, have been cured or waived.

Section 6.03. Other Remedies.

(a) If an Event of Default occurs and is continuing, the Trustee or Collateral Agent may pursue any available remedy to collect the payment of principal of, premium, if any, and interest on, the then outstanding First Lien Notes or to enforce the performance of any provision of such First Lien Notes, this First Lien Indenture or the Security Documents, subject to the First Lien/Second Lien/Third Lien Intercreditor Agreement.

(b) The Trustee or the Collateral Agent may maintain a proceeding even if it does not possess any of the First Lien Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee, the Collateral Agent or any Holder of a First Lien Note in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. All remedies are cumulative to the extent permitted by law.

Section 6.04. Waiver of Past Defaults.

(a) The Holders of a majority in principal amount of the outstanding First Lien Notes of any Series by written notice to the Trustee may on behalf of all Holders waive any existing Default and its consequences hereunder with respect to such Series, except:

(1) a continuing Default in the payment of the principal of, premium, if any, or interest on, any First Lien Note held by a non-consenting Holder (including in connection with an Asset Disposition Offer or a Change of Control Offer); and

(2) a Default with respect to a provision that under Section 9.02 cannot be amended without the consent of each Holder affected,

provided that, subject to Section 6.02, the Holders of a majority in principal amount of the then outstanding First Lien Notes of such Series may rescind an acceleration and its consequences, including any related payment default that resulted from such acceleration. Upon any such waiver, such Default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured for every purpose of this First Lien Indenture for such Series, but no such waiver shall extend to any subsequent or other Default or impair any right consequent thereon.

Section 6.05. Control by Majority.

The Required Secured Noteholders of a majority in principal amount of the outstanding First Lien Notes may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or the Collateral Agent or of exercising any trust or power conferred on the Trustee and the Collateral Agent. However, the Trustee or the Collateral Agent, as applicable may refuse to follow any direction that conflicts with law, this First Lien Indenture, the First Lien Notes, the Security Documents, the First Lien/Second Lien/Third Lien Intercreditor Agreement or any Note Guarantee, or that would involve the Trustee or the Collateral Agent in personal liability.

 

105

Section 6.06. Limitation on Suits.

Subject to Section 6.07, no Holder may pursue any remedy with respect to this First Lien Indenture or the First Lien Notes of any Series unless:

(1) such Holder has previously given the Trustee notice that an Event of Default is continuing;

(2) the Holders of at least 25% in principal amount of the applicable Series of First Lien Notes then outstanding have made a written request to the Trustee to pursue the remedy;

(3) such Holders have offered the Trustee and/or the Collateral Agent security or indemnity reasonably satisfactory to the Trustee and/or the Collateral Agent against any loss, liability or expense;

(4) the Trustee has not complied with such request within 60 days after the receipt of the request and the offer of security or indemnity; and

(5) the Holders of a majority in principal amount of the then outstanding First Lien Notes of such Series have not given the Trustee a direction that, in the opinion of the Trustee, is inconsistent with such request within such 60-day period.

Section 6.07. Rights of Holders to Receive Payment.

Notwithstanding any other provision of this First Lien Indenture, the contractual right of any Holder to receive payment of principal of, premium, if any, and interest on, its First Lien Note, on or after the respective due dates expressed or provided for in such First Lien Note (including in connection with an Asset Disposition Offer or a Change of Control Offer), or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be amended or waived without the consent of such Holder.

Section 6.08. Collection Suit by Trustee.

If an Event of Default specified in Section 6.01(a)(1) or Section 6.01(a)(2) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Company and any other obligor on the First Lien Notes for the whole amount of principal, premium, if any, and interest remaining unpaid on the then outstanding First Lien Notes, together with interest on overdue principal and, to the extent lawful, interest and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee and its agents and counsel.

Section 6.09. Restoration of Rights and Remedies.

 

106

If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this First Lien Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceedings, the Company, the Co-Obligor, the Guarantors, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding has been instituted.

Section 6.10. Rights and Remedies Cumulative.

Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen First Lien Notes in Section 2.07, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy are, to the extent permitted by law, cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

Section 6.11. Delay or Omission Not Waiver.

No delay or omission of the Trustee or of any Holder to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

Section 6.12. Trustee May File Proofs of Claim.

The Trustee may file proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and the Collateral Agent (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, the Collateral Agent and their respective agents and counsel) and the Holders of the First Lien Notes allowed in any judicial proceedings relative to the Company (or any other obligor upon the First Lien Notes, including the Guarantors), its creditors or its property and is entitled and empowered to participate as a member in any official committee of creditors appointed in such matter and to collect, receive and distribute any money or other property payable or deliverable on any such claims. Any custodian in any such judicial proceeding is hereby authorized by each Holder to make such payments to the Trustee, and in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, the Collateral Agent and their respective agents and counsel, and any other amounts due to the Trustee or the Collateral Agent hereunder. To the extent that the payment of any such compensation, expenses, disbursements and advances of the Trustee, the Collateral Agent and their respective agents and counsel, and any other amounts due to the Trustee and the Collateral Agent hereunder out of the estate in any such proceeding, shall be denied for any reason, payment of the same shall be secured by a Lien on, and shall be paid out of, any and all distributions, dividends, money, securities and other properties that the Holders may be entitled to receive in such proceeding whether in liquidation or under any plan of reorganization or arrangement or otherwise. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the First Lien Notes or the rights of any Holder, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

 

107

Section 6.13. Priorities.

Subject to the terms of the First Lien/Second Lien/Third Lien Intercreditor Agreement and the Security Documents, if the Trustee collects any money or property pursuant to this Article 6, it shall pay out the money in the following order:

(1) to the Trustee and the Collateral Agent, any other Agent and their respective agents and attorneys for amounts due hereunder or under the Security Documents, including payment of all reasonable compensation, expenses and liabilities Incurred, and all advances made, by the Trustee and the costs and expenses of collection;

(2) to Holders for amounts due and unpaid on the First Lien Notes for principal, premium, if any, and interest ratably, without preference or priority of any kind, according to the amounts due and payable on the First Lien Notes for principal, premium, if any, and interest, respectively; and

(3) to the Company or to such party as a court of competent jurisdiction shall direct, including a Guarantor, if applicable.

The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.13. Promptly after any record date is set pursuant to this Section 6.13, the Trustee shall cause notice of such record date and payment date to be given to the Company and to each Holder in the manner set forth in Section 13.01.

Section 6.14. Undertaking for Costs.

In any suit for the enforcement of any right or remedy under this First Lien Indenture or in any suit against the Trustee for any action taken or omitted by it as a Trustee, a court in its discretion may require the filing by any party litigant in such suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable and documented attorneys’ fees, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.14 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07, or a suit by Holders of more than 10% in aggregate principal amount of the outstanding First Lien Notes.

ARTICLE 7

TRUSTEE

Section 7.01. Duties of Trustee.

(a) If an Event of Default has occurred and is continuing, the Trustee will exercise such of the rights and powers vested in it by this First Lien Indenture, and use the same degree of care and skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person’s own affairs.

(b) Except during the continuance of an Event of Default:

(1) the duties of the Trustee shall be determined solely by the express provisions of this First Lien Indenture and the Trustee need perform only those duties that are specifically set forth in this First Lien Indenture and no others, and no implied covenants or obligations shall be read into this First Lien Indenture against the Trustee; and

 

108

(2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this First Lien Indenture. However, in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this First Lien Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein) and shall not be liable or responsible for any calculations hereunder or for any information used in any calculations.

(c) The Trustee may not be relieved from liabilities for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:

(1) this Section 7.01(c) does not limit the effect of Section 7.01(b);

(2) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved in a court of competent jurisdiction that the Trustee was negligent in ascertaining the pertinent facts; and

(3) the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05.

(d) Whether or not therein expressly so provided, every provision of this First Lien Indenture that in any way relates to the Trustee is subject to clauses (a), (b) and (c) of this Section 7.01.

(e) Subject to this Article 7, if an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under this First Lien Indenture, the First Lien Notes and the Note Guarantees at the request or direction of any of the Holders unless such Holders have offered to the Trustee indemnity or security reasonably satisfactory to it against any loss, liability or expense.

(f) The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Company. Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

Section 7.02. Rights of Trustee.

(a) The Trustee may conclusively rely upon any document believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any fact or matter stated in the document.

(b) Before the Trustee acts or refrains from acting, it may require an Officer’s Certificate or an Opinion of Counsel or both subject to the other provisions of this First Lien Indenture. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officer’s Certificate or Opinion of Counsel. The Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel as to matters of law shall be full and complete authorization and protection from liability in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon.

 

109

(c) The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent or attorney appointed with due care.

(d) The Trustee shall not be liable for any action it takes or omits to take in good faith that it believes to be authorized or within the rights or powers conferred upon it by this First Lien Indenture.

(e) Unless otherwise specifically provided in this First Lien Indenture, any demand, request, direction or notice from the Company or a Guarantor shall be sufficient if signed by an Officer of the Company or such Guarantor.

(f) None of the provisions of this First Lien Indenture shall require the Trustee to expend or risk its own funds or otherwise to Incur any liability, financial or otherwise, in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds or indemnity reasonably satisfactory to it against such risk or liability is not assured to it.

(g) The Trustee shall not be deemed to have notice or knowledge of any Default or Event of Default or be required to act based on any event unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a Default is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the existence of a Default or Event of Default, the First Lien Notes and this First Lien Indenture.

(h) In no event shall the Trustee be responsible or liable for special, indirect, punitive, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.

(i) The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and each agent, custodian and other Person employed to act hereunder, including the Collateral Agent and each Agent, except that the standard of care for the Collateral Agent shall be “gross negligence and willful misconduct”.

(j) The Trustee may request that the Company deliver an Officer’s Certificate setting forth the names of individuals or titles of officers authorized at such time to take specified actions pursuant to this First Lien Indenture, which Officer’s Certificate may be signed by any person authorized to sign an Officer’s Certificate, including any Person specified as so authorized in any such certificate previously delivered and not superseded.

(k) The Trustee shall not be required to give any bond or surety in respect of the performance of its powers and duties hereunder.

(l) The permissive rights of the Trustee to do things enumerated in this First Lien Indenture shall not be construed as duties.

 

110

(m) Under no circumstances shall the Trustee be liable in its individual capacity for the obligations evidenced by the First Lien Notes.

Section 7.03. Individual Rights of Trustee.

The Trustee or any Agent in its individual or any other capacity may become the owner or pledgee of First Lien Notes and may otherwise deal with the Company or any Affiliate of the Company with the same rights it would have if it were not Trustee or such Agent. However, in the event that the Trustee acquires any conflicting interest, it must eliminate such conflict within 90 days or resign. The Collateral Agent and any Agent may do the same with like rights and duties. The Trustee is also subject to Section 7.09 and Section 7.10.

Section 7.04. Trustee’s Disclaimer.

The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this First Lien Indenture or the First Lien Notes, it shall not be accountable for the Company’s use of the proceeds from the First Lien Notes or any money paid to the Company or upon the Company’s direction under any provision of this First Lien Indenture, it shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee, and it shall not be responsible for any statement or recital herein or any statement in the First Lien Notes or any other document in connection with the sale of the First Lien Notes or pursuant to this First Lien Indenture other than its certificate of authentication on the First Lien Notes.

Section 7.05. Notice of Defaults.

If a Default occurs and is continuing and is actually known to the Trustee, the Trustee will mail to each Holder a notice of the Default within 90 days after it occurs. Except in the case of an Event of Default specified in Section 6.01(a)(1) or Section 6.01(a)(2), the Trustee may withhold from the Holders notice of any continuing Default if the Trustee determines in good faith that withholding the notice is in the interest of the Holders.

Section 7.06. Compensation and Indemnity.

(a) The Company, the Co-Obligor and the Guarantors, jointly and severally, shall pay to the Trustee from time to time such compensation for its acceptance of this First Lien Indenture and services hereunder as the parties shall agree in writing from time to time. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Company shall reimburse the Trustee promptly upon request for all reasonable and documented disbursements, advances and expenses Incurred or made by it in addition to the compensation for its services. Such expenses shall include the reasonable and documented compensation, disbursements and expenses of the Trustee’s agents and counsel. The Trustee shall provide the Company reasonable notice of any expenditure not in the ordinary course of business.

(b) The Company, the Co-Obligor and the Guarantors, jointly and severally, shall indemnify the Trustee for, and hold each of the Trustee and any predecessor and their respective officers, directors, employees and agents harmless against, any and all loss, damage, claims, liability or expense (including reasonable and documented attorneys’ fees and expenses and court costs) Incurred by it in connection with the acceptance or administration of this trust and the performance of its duties hereunder (including the costs and expenses of enforcing this First Lien Indenture against the Company, the Co-Obligor or any Guarantor (including this Section 7.06)) or

 

111

defending itself against any claim whether asserted by any Holder, the Company, the Co-Obligor or any Guarantor, or liability in connection with the acceptance, exercise or performance of any of its powers or duties hereunder). The Trustee shall notify the Company promptly of any claim for which it may seek indemnity. Failure by the Trustee to so notify the Company shall not relieve the Company of its obligations hereunder. The Company shall defend the claim and the Trustee may have separate counsel and the Company shall pay the reasonable and documented fees and expenses of such counsel. The Company need not reimburse any expense or indemnify against any loss, liability or expense Incurred by the Trustee through the Trustee’s own willful misconduct or negligence as finally adjudicated by a court of competent jurisdiction.

(c) The obligations of the Company, the Co-Obligor and the Guarantors under this Section 7.06 shall survive the satisfaction and discharge of this First Lien Indenture or the earlier resignation or removal of the Trustee, Collateral Agent or any Agent.

(d) To secure the payment obligations of the Company, the Co-Obligor and the Guarantors in this Section 7.06, the Trustee shall have a senior claim to which the First Lien Notes are hereby made subordinate on all money or property held or collected by the Trustee, except that held in trust to pay principal and interest on particular First Lien Notes. Such claim shall survive the satisfaction and discharge of this First Lien Indenture.

(e) When the Trustee Incurs expenses or renders services after an Event of Default specified in Section 6.01(a)(8) occurs, the expenses and the compensation for the services (including the fees and expenses of its agents and counsel) are intended to constitute expenses of administration under any Bankruptcy Law.

Section 7.07. Replacement of Trustee.

(a) A resignation or removal of the Trustee and appointment of a successor Trustee shall become effective only upon the successor Trustee’s acceptance of appointment as provided in this Section 7.07. The Trustee may resign in writing at any time by giving 30 days’ prior notice of such resignation to the Company and be discharged from the trust hereby created by so notifying the Company. The Holders of a majority in aggregate principal amount of the then outstanding First Lien Notes may remove the Trustee by so notifying the Trustee and the Company in writing at least 30 days prior to such removal. The Company may remove the Trustee if:

(1) the Trustee fails to comply with Section 7.09;

(2) the Trustee is adjudged a bankrupt or an insolvent or an order for relief is entered with respect to the Trustee under any Bankruptcy Law;

(3) a receiver or public officer takes charge of the Trustee or its property; or

(4) the Trustee becomes incapable of acting.

(b) If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Company shall promptly appoint a successor Trustee. Within one year after the successor Trustee takes office, the Holders of a majority in aggregate principal amount of the then outstanding First Lien Notes may remove the successor Trustee to replace it with another successor Trustee appointed by the Company.

 

112

(c) If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee (at the Company’s expense), the Company or the Holders of at least 10% in aggregate principal amount of the then outstanding First Lien Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee.

(d) If the Trustee, after written request by any Holder who has been a Holder for at least six months, fails to comply with Section 7.09, such Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

(e) A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this First Lien Indenture. The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall promptly transfer all property held by it as Trustee to the successor Trustee; provided that all sums owing to the Trustee hereunder have been paid. Notwithstanding replacement of the Trustee pursuant to this Section 7.07, the Company’s obligations under Section 7.06 shall continue for the benefit of the retiring Trustee. The retiring or removed Trustee shall have no responsibility or liability for the action or inaction of any successor Trustee.

(f) As used in this Section 7.07, the term “Trustee” shall also include the Collateral Agent and each Agent.

Section 7.08. Successor Trustee by Merger, etc.

Any organization or entity into which the Trustee may be merged or converted or with which it may be consolidated, or any organization or entity resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any organization or entity succeeding to all or substantially all of the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such organization or entity shall be otherwise qualified and eligible under this Article 7, without the execution or filing of any paper or any further act on the part of any of the parties hereto.

Section 7.09. Eligibility; Disqualification.

(a) There shall at all times be a Trustee hereunder that is a corporation or national banking association organized and doing business under the laws of the United States or of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition.

(b) This First Lien Indenture shall always have a Trustee who satisfies the requirements of Trust Indenture Act Sections 310(a)(1), (2) and (5). The Trustee is subject to Trust Indenture Act Section 310(b).

Section 7.10. Preferential Collection of Claims Against the Company.

The Trustee is subject to Trust Indenture Act Section 311(a), excluding any creditor relationship listed in Trust Indenture Act Section 311(b). A Trustee who has resigned or been removed shall be subject to Trust Indenture Act Section 311(a) to the extent indicated therein.

 

113

Section 7.11. Limitation on Duty of Trustee and the Collateral Agent in Respect of Collateral; Indemnification.

(a) Beyond the exercise of reasonable care in the custody thereof, the Trustee and the Collateral Agent shall have no duty as to any Collateral in its possession or control or in the possession or control of any agent or bailee or any income thereon or as to preservation of rights against prior parties or any other rights pertaining thereto and the Trustee and the Collateral Agent shall not be responsible for filing any financing or continuation statements or recording any documents or instruments in any public office at any time or times or otherwise perfecting or maintaining the perfection of any security interest in the Collateral. Each of the Trustee and the Collateral Agent shall be deemed to have exercised reasonable care in the custody of the Collateral in its possession or control if the Collateral is accorded treatment substantially equal to that which it accords its own property and shall not be liable or responsible for any loss or diminution in the value of any of the Collateral, by reason of the act or omission of any carrier, forwarding agency or other agent or bailee selected by the Trustee or the Collateral Agent in good faith.

(b) The Trustee and the Collateral Agent shall not be responsible for the existence, genuineness or value of any of the Collateral or for the validity, perfection, priority or enforceability of the Liens in any of the Collateral, whether impaired by operation of law or by reason of any action or omission to act on their respective part hereunder or under the Security Documents, for the validity or sufficiency of the Collateral or any agreement or assignment contained therein, for the validity of the title of the Company to the Collateral, for insuring the Collateral or for the payment of taxes, charges, assessments or Liens upon the Collateral or otherwise as to the maintenance of the Collateral. Subject to Section 7.01 of this First Lien Indenture, the Trustee and the Collateral Agent shall have no duty to ascertain or inquire as to the performance or observance of any of the terms of this First Lien Indenture, the First Lien/Second Lien/Third Lien Intercreditor Agreement, or the Security Documents by the Company or the Guarantors. The Trustee and the Collateral Agent may act and rely and shall be protected in acting and relying in good faith on the opinion or advice of or information obtained from the Company or any Guarantor or any counsel, accountant, appraiser or other expert or adviser, whether retained or employed by the Company or any Guarantor or the Trustee or the Collateral Agent, in relation to any matter arising in the administration of this First Lien Indenture, the First Lien/Second Lien/Third Lien Intercreditor Agreement or the Security Documents.

ARTICLE 8

LEGAL DEFEASANCE AND COVENANT DEFEASANCE

Section 8.01. Option to Effect Legal Defeasance or Covenant Defeasance.

The Company may, at its option and at any time, elect to have either Section 8.02 or Section 8.03 applied to all outstanding First Lien Notes upon compliance with the conditions set forth below in this Article 8.

Section 8.02. Legal Defeasance and Discharge.

(a) Upon the Company’s exercise under Section 8.01 of the option applicable to this Section 8.02, the Company and the Guarantors shall, subject to the satisfaction of the conditions set forth in Section 8.04, be deemed to have been discharged from their obligations with respect to this First Lien Indenture, all outstanding First Lien Notes and Note Guarantees and the Liens on the Collateral securing the First Lien Notes and the Note Guarantees will be automatically

 

114

released and the Security Documents and the First Lien/Second Lien/Third Lien Intercreditor Agreement shall cease to be of further effect on the date the conditions set forth below are satisfied (“Legal Defeasance”). For this purpose, Legal Defeasance means that the Company shall be deemed to have paid and discharged the entire Indebtedness represented by the then outstanding First Lien Notes, which shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.05 and the other Sections of this First Lien Indenture referred to in clauses (1) through (4) below, and to have satisfied all of its other obligations under such First Lien Notes and this First Lien Indenture, including that of the Guarantors (and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder:

(1) the rights of Holders to receive payments in respect of the principal of, premium, if any, and interest on, the then outstanding First Lien Notes when such payments are due, solely out of the trust created pursuant to this First Lien Indenture referred to in Section 8.04;

(2) the Company’s obligations with respect to the First Lien Notes concerning issuing temporary First Lien Notes, registration of First Lien Notes, mutilated, destroyed, lost or stolen First Lien Notes and the maintenance of an office or agency for payment and money for First Lien Note payments held in trust;

(3) the rights, powers, trusts, duties and immunities of the Trustee, and the Company’s obligations in connection therewith; and

(4) this Section 8.02.

(b) Following the Company’s exercise of its Legal Defeasance option, payment of the then outstanding First Lien Notes may not be accelerated because of an Event of Default with respect to such First Lien Notes.

(c) Subject to compliance with this Article 8, the Company may exercise its option under this Section 8.02 notwithstanding the prior exercise of its option under Section 8.03.

Section 8.03. Covenant Defeasance.

(a) Upon the Company’s exercise under Section 8.01 of the option applicable to this Section 8.03, the Company and the Guarantors shall, subject to the satisfaction of the conditions set forth in Section 8.04, be released from their obligations under any or all (within the Company’s sole discretion) of the covenants contained in Sections 3.09, 4.05, 4.06, 4.08, 4.09, 4.10, 4.11, 4.12, 4.13, 4.14, 4.15, 4.16, 4.18, 4.19 and 4.18 and clause (4) of Section 5.01(d) with respect to the then outstanding First Lien Notes, and the Guarantors shall be deemed to have been discharged from their obligations with respect to all Note Guarantees, on and after the date the conditions set forth in Section 8.04 are satisfied (“Covenant Defeasance”), and such First Lien Notes shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder. For this purpose, Covenant Defeasance means that, with respect to this First Lien Indenture and the outstanding First Lien Notes, the Company may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by

 

115

reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.01, but, except as specified above, the remainder of this First Lien Indenture and such First Lien Notes shall be unaffected thereby. Upon the Company’s exercise under Section 8.01 of the option applicable to this Section 8.03, all Liens on the Collateral securing the First Lien Notes and the Note Guarantees shall be released and the Security Documents and the First Lien/Second Lien/Third Lien Intercreditor Agreement shall cease to be of further effect.

(b) Upon the Company’s exercise under Section 8.01 of the option applicable to this Section 8.03, subject to the satisfaction of the conditions set forth in Section 8.04, an Event of Default specified in Section 6.01(a)(3) that resulted solely from the failure of the Company to comply with Section 5.01(a)(4), Section 6.01(a)(4) (only with respect to covenants that are released as a result of such Covenant Defeasance), Section 6.01(a)(5) (only with respect to covenants that are released as a result of such Covenant Defeasance), Section 6.01(a)(6), Section 6.01(a)(7), Section 6.01(a)(8) (solely with respect to Significant Subsidiaries or any group of Restricted Subsidiaries that, taken together (as of the date of the latest consolidated financial statements of the Company and its Restricted Subsidiaries) would constitute a Significant Subsidiary), Section 6.01(a)(9), Section 6.01(a)(10), Section 6.01(a)(11) or Section 6.01(a)(12), in each case, shall not constitute an Event of Default.

Section 8.04. Conditions to Legal or Covenant Defeasance.

(a) The following shall be the conditions to the exercise of either the Legal Defeasance option under Section 8.02 or the Covenant Defeasance option under Section 8.03 with respect to the First Lien Notes:

(1) the Company must irrevocably deposit with the Trustee for the benefit of the Holders, cash in U.S. dollars, Government Securities, or a combination thereof, in amounts as will be sufficient, without consideration of any reinvestment of interest, to pay the principal, premium, if any, and interest due on the outstanding First Lien Notes on the Stated Maturity or on the applicable redemption date, as the case may be, and the Company must specify whether the First Lien Notes are being defeased to maturity or to a particular redemption date;

(2) in the case of Legal Defeasance, the Company has delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, (A) the Company shall have received from, or there has been published by, the U.S. Internal Revenue Service a ruling, or (B) since the Issue Date, there has been a change in the applicable U.S. federal income tax law, in either case to the effect that, and based thereon such Opinion of Counsel will confirm that, the beneficial owners of the First Lien Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;

(3) in the case of Covenant Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel reasonably acceptable to the Trustee confirming that, subject to customary assumptions and exclusions, the beneficial owners of the First Lien Notes will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;

 

116

(4) the Company shall have delivered to the Trustee an Officer’s Certificate stating that the deposit was not made by the Company with the intent of defeating, hindering, delaying or defrauding any creditors of the Company, any Guarantor or others;

(5) the Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel (which Opinion of Counsel may be subject to customary assumptions and exclusions), each stating that all conditions precedent relating to the Legal Defeasance or the Covenant Defeasance, as the case may be, have been complied with; and

(6) the Company shall have delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of the First Lien Notes at maturity or the redemption date, as the case may be (which instructions may be contained in the Officer’s Certificate referred to in clause (5) above).

Section 8.05. Deposited Money and Government Securities to Be Held in Trust; Other Miscellaneous Provisions.

(a) Subject to Section 8.06, all money and Government Securities (including the proceeds thereof) deposited with the Trustee pursuant to Section 8.04 in respect of the outstanding First Lien Notes shall be held in trust and applied by the Trustee, in accordance with the provisions of such First Lien Notes and this First Lien Indenture, to the payment, either directly or through any Paying Agent (including the Company or a Guarantor acting as Paying Agent) as the Trustee may determine, to the Holders of all sums due and to become due thereon in respect of principal of, premium, if any, and interest on, the First Lien Notes, but such money need not be segregated from other funds except to the extent required by law.

(b) The Company shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or Government Securities deposited pursuant to Section 8.04 or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders.

(c) Anything in this Article 8 to the contrary notwithstanding, the Trustee shall deliver or pay to the Company from time to time upon the request of the Company any money or Government Securities held by it as provided in Section 8.04 which, in the judgment of the Board of Directors of the Company expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

Section 8.06. Repayment to the Company.

Subject to any applicable abandoned property law, any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of, premium, if any, or interest on, any First Lien Note and remaining unclaimed for two years after such principal, premium, if any, or interest has become due and payable shall be paid to the Company on its request or (if then held by the Company) shall be discharged from such trust; and the Holder of such First Lien Note shall thereafter look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease.

 

117

Section 8.07. Reinstatement.

If the Trustee or Paying Agent is unable to apply any U.S. dollars or Government Securities in accordance with Section 8.02 or Section 8.03, as the case may be, by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, then the Company’s and the Guarantors’ obligations under this First Lien Indenture, the First Lien Notes and the Note Guarantees shall be revived and reinstated as though no deposit had occurred pursuant to Section 8.02 or Section 8.03 until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.02 or Section 8.03, as the case may be; provided that, if the Company makes any payment of principal of, premium, if any, or interest on, any First Lien Note following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders to receive such payment from the money held by the Trustee or Paying Agent.

ARTICLE 9

AMENDMENT, SUPPLEMENT AND WAIVER

Section 9.01. Without Consent of Holders.

(a) Notwithstanding Section 9.02, without the consent of any Holder of First Lien Notes of any Series, the Company, the Guarantors, the Trustee and the Collateral Agent may amend this First Lien Indenture as it relates to any Series of First Lien Notes, the First Lien Notes of such Series, the related Note Guarantees, the Security Documents and the First Lien/Second Lien/Third Lien Intercreditor Agreement to:

(1) cure any ambiguity, omission, defect or inconsistency;

(2) provide for the assumption by a successor entity of the obligations of the Company or any Guarantor under this First Lien Indenture, the First Lien Notes, the Note Guarantees or the Security Documents in accordance with Article 5;

(3) provide for or facilitate the issuance of uncertificated First Lien Notes in addition to or in place of certificated First Lien Notes; provided that the uncertificated First Lien Notes are issued in registered form for purposes of Section 163(f) of the Code;

(4) comply with the rules of any applicable depositary;

(5) add guarantors with respect to the First Lien Notes or release a Guarantor from its obligations under its Note Guarantee or this First Lien Indenture, in each case, in accordance with the applicable provisions of this First Lien Indenture, including adding additional provisions to affect the guarantee of any additional foreign guarantor, including related to any limitation thereof;

(6) add Collateral to secure the First Lien Notes and the Note Guarantees, release Collateral from any Liens securing the First Lien Notes and the Note Guarantees, in each case when permitted, required or automatically effected by this First Lien Indenture, the Security Documents or the First Lien/Second Lien/Third Lien

 

118

Intercreditor Agreement, and to modify the Security Documents or the First Lien/Second Lien/Third Lien Intercreditor Agreement to secure additional extensions of credit and add additional secured creditors holding Obligations that are permitted under the First Lien/Second Lien/Third Lien Intercreditor Agreement pursuant to the terms of this First Lien Indenture or subordinate the Liens securing creditors of other Obligations to the Liens on the Collateral securing the First Lien Notes and the Note Guarantees;

(7) add covenants of the Company and its Restricted Subsidiaries or Events of Default for the benefit of Holders or to make changes that would provide additional rights to the Holders or to surrender any right or power conferred upon the Company or any Guarantor;

(8) make any change that does not adversely affect the legal rights under this First Lien Indenture, the First Lien Notes or the Note Guarantees of any Holder in any material respect;

(9) evidence and provide for the acceptance of an appointment under this First Lien Indenture of a successor trustee; provided that the successor trustee is otherwise qualified and eligible to act as such under the terms of this First Lien Indenture;

(10) conform the text of this First Lien Indenture, the First Lien Notes or the Note Guarantees to any provision of the “Description of the New First Lien Notes” section of the Offering Memorandum to the extent that such provision in such “Description of the New First Lien Notes” was intended to be a verbatim recitation of a provision of this First Lien Indenture, the First Lien Notes or the Note Guarantees; or

(11) make any amendment to the provisions of this First Lien Indenture relating to the transfer and legending of First Lien Notes as permitted by this First Lien Indenture, including, without limitation, to facilitate the issuance and administration of the First Lien Notes; provided, however, that (A) compliance with this First Lien Indenture as so amended would not result in First Lien Notes being transferred in violation of the Securities Act or any applicable securities law and (B) such amendment does not materially and adversely affect the rights of Holders to transfer First Lien Notes; or

(12) amend this First Lien Indenture as it relates to the other Series of First Lien Notes as permitted under this First Lien Indenture.

(b) Upon the request of the Company, and upon receipt by the Trustee of the documents described in Section 7.02 and Section 13.02, the Trustee shall join with the Company and the Guarantors in the execution of any amended or supplemental indenture authorized or permitted by the terms of this First Lien Indenture and to make any further appropriate agreements and stipulations that may be therein contained, but the Trustee shall not be obligated to enter into such amended or supplemental indenture that affects its own rights, duties or immunities under this First Lien Indenture or otherwise. Notwithstanding the foregoing, no Opinion of Counsel shall be required in connection with the addition of a Guarantor under this First Lien Indenture upon execution and delivery by such Guarantor and the Trustee of a supplemental indenture to this First Lien Indenture, the form of which is attached as Exhibit C, and delivery of an Officer’s Certificate, except as provided in Section 5.01(c).

 

119

Section 9.02. With Consent of Holders.

(a) Except as provided in Section 9.01 and this Section 9.02, the Company, the Guarantors, the Trustee and the Collateral Agent may amend or supplement this First Lien Indenture as it relates to a Series of First Lien Notes, the First Lien Notes of such Series, the related Note Guarantees, the Security Documents and the First Lien/Second Lien/Third Lien Intercreditor Agreement with the consent of the Holders of a majority in principal amount of such Series of First Lien Notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, First Lien Notes of such Series) and, subject to Section 6.04 and Section 6.07, any existing Default or Event of Default with respect to a Series of First Lien Notes (other than a Default or Event of Default in the payment of the principal of, premium, if any, or interest on, such Series of First Lien Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of this First Lien Indenture as it relates to such Series of First Lien Notes, the First Lien Notes of such Series, the related Note Guarantees, the Security Documents or the First Lien/Second Lien/Third Lien Intercreditor Agreement may be waived with the consent of the Holders of a majority in principal amount of such Series of First Lien Notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, First Lien Notes of such Series). Section 2.08 and Section 2.09 shall determine which First Lien Notes are considered to be “outstanding” for the purposes of this Section 9.02.

(b) Upon the request of the Company, and upon the filing with the Trustee of evidence satisfactory to the Trustee of the consent of the applicable Holders as aforesaid, and upon receipt by the Trustee of the documents described in Section 7.02 and Section 13.02, the Trustee shall join with the Company and the Guarantors in the execution of such amended or supplemental indenture unless such amended or supplemental indenture directly affects the Trustee’s own rights, duties or immunities under this First Lien Indenture or otherwise, in which case the Trustee may in its discretion, but shall not be obligated to, enter into such amended or supplemental indenture.

(c) It shall not be necessary for the consent of the Holders of First Lien Notes of a Series under this Section 9.02 to approve the particular form of any proposed amendment, supplement or waiver. It shall be sufficient if such consent approves the substance of such proposed amendment, supplement or waiver.

(d) After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Company will give to the Holders of First Lien Notes of the applicable Series a notice briefly describing such amendment, supplement or waiver. However, the failure of the Company to give such notice to all the Holders of such Series of First Lien Notes, or any defect in the notice, shall not impair or affect the validity of any such amendment, supplement or waiver.

(e) Without the consent of each affected Holder of First Lien Notes of the applicable Series, no amendment, supplement or waiver under this Section 9.02 may (with respect to any First Lien Notes held by a non-consenting Holder of First Lien Notes of such Series):

(1) reduce the principal amount of such Series of First Lien Notes whose Holders must consent to an amendment, supplement or waiver;

(2) reduce the stated rate of interest or extend the stated time for payment of interest on any First Lien Note of such Series;

 

120

(3) reduce the principal of or extend the Stated Maturity of any First Lien Note of such Series;

(4) waive a Default or Event of Default in the payment of principal of, premium, if any, or interest on, the First Lien Notes of such Series (except a rescission of acceleration of the First Lien Notes of such Series by the Holders of at least a majority in aggregate principal amount of then outstanding First Lien Notes of such Series with respect to a nonpayment default and a waiver of the payment default that resulted from such acceleration);

(5) reduce the principal of or change the fixed maturity of any First Lien Note of such Series or alter the provisions with respect to the redemption of the First Lien Notes of such Series (other than provisions relating to Section 4.15 and Section 4.16);

(6) make any First Lien Note of such Series payable in a currency other than that stated in such First Lien Note;

(7) modify the contractual right of any Holder of First Lien Notes of such Series to receive payment of principal of, premium, if any, or interest on, such Holder’s First Lien Notes of such Series on or after the due dates therefor or to institute suit for the enforcement of any payment on or with respect to such Holder’s First Lien Notes of such Series;

(8) make any change in the amendment or waiver provisions which require each Holder’s consent;

(9) modify the Note Guarantees in any manner adverse to the Holders of such Series of First Lien Notes; or

(10) make any change in the provisions governing the application of proceeds from sales of Collateral in the First Lien/Second Lien/Third Lien Intercreditor Agreement or this First Lien Indenture that would adversely affect the Holders of such Series of First Lien Notes.

Without the consent of the Holders of at least 90% aggregate principal amount of the applicable Series of First Lien Notes then outstanding, no amendment, supplement or waiver under this Section 9.02 may (x) subordinate the Liens on the Collateral securing such Series of First Lien Notes or (y) make any changes to, or modify, the ranking of the First Lien Notes in a manner that adversely affects Holders of such Series of First Lien Notes’ right to payment.

For the avoidance of doubt, neither the Trustee nor the Collateral Agent shall enter into any intercreditor arrangement that would serve to either (A) subordinate or permit the subordination of the Liens on any Collateral securing the First Lien Notes to the Liens securing any other Indebtedness or (B) subordinate or permit the subordination of the right of payment of the First Lien Notes to the right of payment of any other Indebtedness, in each case, without the prior written consent of at least 90% aggregate principal amount of each Series of First Lien Notes then outstanding.

 

121

In addition, without the consent of Holders of at least 66.67% in aggregate principal amount of each Series of First Lien Notes then outstanding, no amendment or waiver may release all or substantially all of the Collateral from the Liens under this First Lien Indenture and the Security Documents with respect such Series of First Lien Notes.

(f) In determining whether the Holders of the requisite principal amount of First Lien Notes have concurred in any direction, waiver or consent, First Lien Notes beneficially owned by the Company, or by any Affiliate of the Company (other than SBG), shall be considered as though not outstanding, except that for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only First Lien Notes that a responsible officer of the Trustee actually knows are so owned shall be so disregarded. First Lien Notes so owned which have been pledged in good faith shall not be disregarded if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right to deliver any such direction, waiver or consent with respect to the First Lien Notes and that the pledgee is not the Company or any obligor upon the First Lien Notes or any Affiliate of the Company (other than SBG) or of such other obligor.

(g) For the purposes of determining whether any amendment, supplement, modification, waiver, rescission or exercise of remedies has been consented to by the Holders of a majority in principal amount or requisite percentage of Holders of each Series of First Lien Notes then outstanding (i) for so long as SBG is committed to purchase Series II Notes in connection with the Transactions as described in the Offering Memorandum, the principal amount of Series II First Lien Notes then outstanding shall be deemed to be (x) $300.00 million minus any Series II First Lien Notes actually issued and subsequently exchanged for Series I First Lien Notes as described under Section 2.15 as determined by the Company in good faith and (y) held by SBG and (ii) on or prior to the one year anniversary of the Issue Date, the principal amount of Series III First Lien Notes then outstanding shall be deemed to be (x) $175.00 million minus any Series III First Lien Notes actually issued and subsequently exchanged for Series I First Lien Notes as described under Section 2.15 as determined by the Company in good faith and (y) held by the initial purchaser of the Series III Notes pursuant to the terms of the Third Party Investor Purchase Agreement.

(h) In addition, if (x) at any time this First Lien Indenture is amended to permit, or the requisite Holders otherwise agree to a waiver that permits the Company to Incur any Permitted Additional First Lien Indebtedness and (y) such Permitted Additional First Lien Indebtedness is Incurred in connection with such amendment or waiver, the Incurrence of such Permitted Additional First Lien Indebtedness shall be subject to a right of first offer for the benefit of the Holders of the First Lien Notes (as of a record date to be determined by the Company) owning (in the aggregate with their respective Affiliates and managed funds) more than 15% of the aggregate principal amount of any Series of First Lien Notes then outstanding which have identified themselves, within a reasonable time period established by the Company not to exceed 10 Business Days, as being interested in providing the Permitted Additional First Lien Indebtedness, and provided the Company and Trustee with customary evidence of the aggregate principal amount of the First Lien Notes held by them (such Holders, the “Eligible Holders”) prior to any such Incurrence (such date, the “Permitted Additional First Lien Indebtedness Effective Date”) in accordance with the following provisions:

(1) Not more than 30 days and not less than 15 days prior to the Permitted Additional First Lien Indebtedness Effective Date, the Company shall give the Trustee and all Holders written notice of such proposed Incurrence (an “Offer Notice”), which shall include either draft forms of definitive documentation governing such Permitted Additional First Lien Indebtedness or a term sheet or other reasonably detailed description of the expected terms of such Permitted Additional First Lien Indebtedness;

 

122

(2) Any such Eligible Holder may elect (directly or through its Affiliates or managed funds) to provide and fund its pro rata share (based on a percentage obtained by dividing the aggregate principal amount of any Series of First Lien Notes owned by such Eligible Holder as of a record date fixed by the Company by the total aggregate principal amount of such Series of First Lien Notes owned by all Eligible Holders outstanding as of such record date) of the full amount of such Permitted Additional First Lien Indebtedness on the terms and subject to the conditions set forth in the Offer Notice by giving the Company notice (a “Participation Acceptance”) not later than 5:00 p.m., New York City time, on the date that is two Business Days after the date on which such Eligible Holder receives the applicable Offer Notice (the “Participation Acceptance Deadline”), and such Participation Acceptance shall constitute a binding and irrevocable agreement by such Eligible Holder to commit to provide and fund such Permitted Additional First Lien Indebtedness on the terms and subject to the conditions set forth in the Offer Notice;

(3) If the Company does not receive a Participation Acceptance by an Eligible Holder before the Participation Acceptance Deadline in respect of such Permitted Additional First Lien Indebtedness, then (A) such Eligible Holder shall be deemed to have rejected the offer to provide and fund such Permitted Additional First Lien Indebtedness, (B) the Company shall have no obligation to make any further offer to such Eligible Holder in respect of such Permitted Additional First Lien Indebtedness and (C) such Eligible Holder shall have no rights in respect of such Permitted Additional First Lien Indebtedness;

(4) If fewer than all Eligible Holders elect to purchase their respective pro rata shares of the Permitted Additional First Lien Indebtedness in accordance with clause (ii) above or 100% of the Permitted Additional First Lien Indebtedness is not otherwise committed to by the Eligible Holders, then the Company shall deliver a notice (a “Top-Up Notice”) to each Eligible Holder that delivered a Participation Acceptance (each a “Fully-Participating Holder”), which Top-Up Notice shall include the amount of Offered Debt that remains uncommitted (the “Additional Offered Debt”). Each Fully-Participating Holder shall have the option, exercisable during the three (3) Business Day period immediately following the delivery of the Top-Up Notice, by delivering written notice to the Company, to commit to provide and fund all or any portion of the Additional Offered Debt on the terms and subject to the conditions set forth in the original Offer Notice;

(5) Notwithstanding anything herein to the contrary, if (I) the Fully-Participating Holders have not elected to provide and fund at least 100% of the aggregate amount of the Permitted Additional First Lien Indebtedness, and delivered Participation Acceptances for all of the Permitted Additional First Lien Indebtedness or (II) the Company is prepared and able to close on the Permitted Additional First Lien Indebtedness and the relevant Fully-Participating Holders are unable or unwilling to provide the Permitted Additional First Lien Indebtedness within thirty (30) days of the execution of their respective Participation Acceptances referenced above (other than as a result of the failure of the Company or any third party to satisfy the conditions precedent to closing set forth in the definitive documentation governing such Permitted Additional First Lien Indebtedness), then, in either case, the Company may offer all or any portion of such Permitted Additional First Lien Indebtedness to any other Person;

 

123

(6) Each Eligible Holder shall take or cause to be taken all such reasonable actions as may be necessary or reasonably desirable in order to expeditiously consummate any Permitted Additional First Lien Indebtedness transaction pursuant to this section; and

(7) if any Permitted Additional First Lien Indebtedness is not fungible for U.S. federal income tax purposes with any portion of the Series I First Lien Notes, such Permitted Additional First Lien Indebtedness will trade separately under separate CUSIP numbers and ISINs from any portion of the Series I First Lien Notes with which such Permitted Additional First Lien Indebtedness is not fungible.

(i) A consent to any amendment, supplement or waiver of this First Lien Indenture, the First Lien Notes or the Note Guarantee by any Holder given in connection with a tender of such Holder’s First Lien Notes shall not be rendered invalid by such tender.

Section 9.03. Revocation and Effect of Consents.

(a) Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a First Lien Note is a continuing consent by the Holder of a First Lien Note and every subsequent Holder of a First Lien Note or portion of a First Lien Note that evidences the same debt as the consenting Holder’s First Lien Note, even if notation of the consent is not made on any First Lien Note. However, any such Holder of a First Lien Note or subsequent Holder of a First Lien Note may revoke the consent as to its First Lien Note if the Trustee receives written notice of revocation before the date the waiver, supplement or amendment becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder.

(b) The Company may, but shall not be obligated to, fix a record date pursuant to Section 1.04 for the purpose of determining the Holders entitled to consent to any amendment, supplement or waiver.

Section 9.04. Notation on or Exchange of First Lien Notes.

(a) The Trustee may place an appropriate notation about an amendment, supplement or waiver on any First Lien Note thereafter authenticated. The Company in exchange for all First Lien Notes may issue and the Trustee shall, upon receipt of an Authentication Order, authenticate new First Lien Notes that reflect the amendment, supplement or waiver.

(b) Failure to make the appropriate notation or issue a new First Lien Note shall not affect the validity and effect of such amendment, supplement or waiver.

Section 9.05. Trustee to Sign Amendments, etc.

The Trustee shall sign any amendment, supplement or waiver authorized pursuant to this Article 9 if the amendment, supplement or waiver does not adversely affect the rights, duties, liabilities or immunities of the Trustee. In executing any amendment, supplement or waiver, the Trustee shall be entitled to receive and (subject to Section 7.01) shall be fully protected in conclusively relying upon, in addition to the documents required by Section 13.02, an Officer’s

 

124

Certificate and an Opinion of Counsel stating that the execution of such amendment, supplement or waiver is authorized or permitted by this First Lien Indenture and that such amendment, supplement or waiver is the valid and binding obligation of the Company and any Guarantor party thereto, enforceable against them in accordance with its terms, subject to customary exceptions, and complies with the provisions hereof.

ARTICLE 10

GUARANTEES

Section 10.01. Guarantee.

(a) Subject to this Article 10, each of the Guarantors hereby, jointly and severally, irrevocably and unconditionally guarantees, on a senior basis, to each Holder and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of this First Lien Indenture, the First Lien Notes or the obligations of the Company hereunder or thereunder, that: (1) the principal of, premium, if any, and interest on, the First Lien Notes shall be promptly paid in full when due, whether at Stated Maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of and interest on the First Lien Notes, if any, if lawful, and all other Obligations of the Company to the Holders or the Trustee hereunder or under the First Lien Notes shall be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and (2) in case of any extension of time of payment or renewal of any First Lien Notes or any of such other obligations, that same shall be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at Stated Maturity, by acceleration or otherwise, subject, however, in the case of clause (1) and (2) above, to the limitation set forth in Section 10.02, collectively, the “Guaranteed Obligations”. Failing payment by the Company when due of any amount so Guaranteed or any performance so Guaranteed for whatever reason, the Guarantors shall be jointly and severally obligated to pay the same immediately. Each Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.

(b) The Guarantors hereby agree (to the extent permitted by applicable law) that their obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the First Lien Notes or this First Lien Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder with respect to any provisions hereof or thereof, the recovery of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a Guarantor. Each Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Company, any right to require a proceeding first against the Company, protest, notice and all demands whatsoever and covenants that this Note Guarantee shall not be discharged except by complete performance of the obligations contained in the First Lien Notes and this First Lien Indenture, or pursuant to Section 10.06.

(c) Each of the Guarantors also agrees (to the extent permitted by applicable law), jointly and severally, to pay any and all costs and expenses (including reasonable and documented attorneys’ fees and expenses) Incurred by the Trustee or any Holder in enforcing any rights under this Section 10.01.

(d) If any Holder or the Trustee is required by any court or otherwise to return to the Company, the Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to the Company or the Guarantors, any amount paid either to the Trustee or such Holder, this Note Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.

 

125

(e) Each Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations Guaranteed hereby until payment in full of all obligations Guaranteed hereby. Each Guarantor further agrees that, as between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (1) the maturity of the obligations Guaranteed hereby may be accelerated as provided in Article 6 for the purposes of this Note Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations Guaranteed hereby, and (2) in the event of any declaration of acceleration of such obligations as provided in Article 6, such obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purpose of this Note Guarantee. The Guarantors shall have the right to seek contribution from any non-paying Guarantor so long as the exercise of such right does not impair the rights of the Holders under the Note Guarantees.

(f) Each Note Guarantee shall remain in full force and effect and continue to be effective should any petition be filed by or against the Company for liquidation or reorganization, should the Company become insolvent or make an assignment for the benefit of creditors or should a receiver or trustee be appointed for all or any significant part of the Company’s assets, and shall, to the fullest extent permitted by law, continue to be effective or be reinstated, as the case may be, if at any time payment and performance of the First Lien Notes are, pursuant to applicable law, rescinded or reduced in amount, or must otherwise be restored or returned by any obligee on the First Lien Notes or the Note Guarantees, whether as a “voidable preference,” “fraudulent transfer” or otherwise, all as though such payment or performance had not been made. In the event that any payment or any part thereof, is rescinded, reduced, restored or returned, the First Lien Notes shall, to the fullest extent permitted by law, be reinstated and deemed reduced only by such amount paid and not so rescinded, reduced, restored or returned.

(g) In case any provision of any Note Guarantee shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby, to the extent permitted by applicable law.

(h) Each payment to be made by a Guarantor in respect of its Note Guarantee shall be made without set-off, counterclaim, reduction or diminution of any kind or nature.

Section 10.02. Limitation on Guarantor Liability.

Each Guarantor, and by its acceptance of First Lien Notes, each Holder, hereby confirms that it is the intention of all such parties that the Note Guarantee of such Guarantor not constitute a fraudulent conveyance or a fraudulent transfer for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to any Note Guarantee. To effectuate the foregoing intention, the Trustee, the Holders and the Guarantors hereby irrevocably agree that the obligations of each Guarantor shall be limited to the maximum amount as will, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Guarantor that are relevant under such laws and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under this Article 10, result in the obligations of such Guarantor under its Note Guarantee not constituting a fraudulent conveyance or fraudulent transfer under applicable law. Each Guarantor that makes a payment under its Note Guarantee will be entitled upon payment in full of all Guaranteed Obligations under this First Lien Indenture to a contribution from each other Guarantor in an amount equal to such other Guarantor’s pro rata portion of such payment based on the respective net assets of all the Guarantors at the time of such payment, determined in accordance with GAAP.

 

126

Section 10.03. Execution and Delivery.

(a) To evidence its Note Guarantee set forth in Section 10.01, each Guarantor hereby agrees that this First Lien Indenture shall be executed on behalf of such Guarantor.

(b) Each Guarantor hereby agrees that its Note Guarantee set forth in Section 10.01 shall remain in full force and effect notwithstanding the absence of the endorsement of any notation of such Note Guarantee on the First Lien Notes.

(c) If a Person whose signature is on this First Lien Indenture no longer holds that office at the time the Trustee authenticates the First Lien Note, the Note Guarantees shall be valid nevertheless.

(d) The delivery of any First Lien Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Note Guarantee set forth in this First Lien Indenture on behalf of the Guarantors.

(e) If required by Section 4.11, the Company shall cause any newly created or acquired Restricted Subsidiary to comply with the provisions of Section 4.11 and this Article 10, to the extent applicable.

Section 10.04. Subrogation.

Each Guarantor shall be subrogated to all rights of Holders against the Company in respect of any amounts paid by any Guarantor pursuant to the provisions of Section 10.01; provided that, if an Event of Default has occurred and is continuing, no Guarantor shall be entitled to enforce or receive any payments arising out of, or based upon, such right of subrogation until all amounts then due and payable by the Company under this First Lien Indenture or the First Lien Notes shall have been paid in full.

Section 10.05. Benefits Acknowledged.

Each Guarantor acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by this First Lien Indenture and that the guarantee and waivers made by it pursuant to its Note Guarantee are knowingly made in contemplation of such benefits.

Section 10.06. Release of Note Guarantees.

(a) A Note Guarantee by a Guarantor shall be automatically and unconditionally released and discharged, and no further action by such Guarantor, the Company or the Trustee shall be required for the release of such Guarantor’s Note Guarantee, upon:

 

127

(1) (A) in the case of a Guarantor that is a Subsidiary, any sale, assignment, transfer, conveyance, exchange or other disposition (by merger, amalgamation, arrangement, consolidation, winding up, dissolution, liquidation or otherwise) of the Capital Stock of such Guarantor after which the applicable Guarantor is no longer a Restricted Subsidiary, which sale, assignment, transfer, conveyance, exchange or other disposition is made in compliance with the provisions of this First Lien Indenture, including, if applicable, Section 4.16 (it being understood that only such portion of the Net Available Cash as is required to be applied on or before the date of such release in accordance with the terms of this First Lien Indenture needs to be applied in accordance therewith at such time) and Section 5.01(a);

(B) in the case of a Guarantor that is a Subsidiary, the proper designation of any Guarantor as an Unrestricted Subsidiary; or

(C) the Company’s exercise of its Legal Defeasance option or Covenant Defeasance option in accordance with Article 8 or the discharge of the Company’s obligations under this First Lien Indenture in accordance with the terms of this First Lien Indenture; or

(D) in the case of the Parent Guarantee, if the Parent Guarantor ceases to be the direct parent of the Company as a result of a transaction permitted pursuant to this First Lien Indenture, subject to the assumption of all of the obligations of the Parent Guarantor under this First Lien Indenture and the applicable Security Documents, in each case, pursuant to supplement indentures or other applicable documents or instruments by the entity that directly owns 100% of the issued and outstanding Equity Interests in the Company; and

(2) the Company delivering to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that all conditions precedent provided for in this First Lien Indenture relating to such transaction or release have been complied with.

(b) At the written request of the Company, the Trustee shall execute and deliver any documents reasonably required in order to evidence such release, discharge and termination in respect of the applicable Note Guarantee.

Section 10.07. Co-Obligor.

(a) Co-Obligor is a co-obligor of the First Lien Notes, liable for the due and punctual payment of the principal of, premium, if any, and interest on, all of the First Lien Notes.

(b) Co-Obligor and the Company, as co-obligors, shall be unconditionally jointly and severally liable for the due and punctual payment of the principal of, and interest on, all of the First Lien Notes, and for all Notes Obligations under this First Lien Indenture and in connection with the First Lien Notes.

ARTICLE 11

SATISFACTION AND DISCHARGE

Section 11.01. Satisfaction and Discharge.

(a) This First Lien Indenture will be discharged, and will cease to be of further effect as to all First Lien Notes issued thereunder, and all Liens on the Collateral securing the First Lien Notes and the Note Guarantees shall be released and the Security Documents shall cease to be of further effect and the First Lien/Second Lien/Third Lien Intercreditor Agreement shall cease to be of further effect with respect to the Collateral Agent, Trustee, Holders and Obligations owed to them in respect of this First Lien Indenture, the First Lien Notes and the Security Documents, when either:

 

128

(1) all First Lien Notes that have been authenticated and delivered (except lost, stolen or destroyed First Lien Notes that have been replaced or paid and First Lien Notes for whose payment money has been deposited in trust) have been delivered to the Trustee for cancellation; or

(2) (A) all First Lien Notes not theretofore delivered to the Trustee for cancellation have become due and payable by reason of the giving of a notice of redemption or otherwise, will become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and the Company or any Guarantor has irrevocably deposited or caused to be deposited with the Trustee, as trust funds in trust solely for the benefit of the Holders, cash in U.S. dollars, Government Securities, or a combination thereof, in such amounts as will be sufficient, without consideration of any reinvestment of interest, to pay and discharge the entire Indebtedness on the First Lien Notes not theretofore delivered to the Trustee for cancellation for principal, premium, if any, and accrued interest to the date of maturity or redemption, as the case may be;

(B) the Company or any Guarantor has paid or caused to be paid all sums payable by the Company under this First Lien Indenture; and

(C) the Company has delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of the First Lien Notes at maturity or the redemption date, as the case may be.

(b) In addition, the Company shall deliver to the Trustee an Officer’s Certificate and an Opinion of Counsel (which Opinion of Counsel may be subject to customary assumptions and exclusions), each stating that all conditions precedent to satisfaction and discharge have been satisfied. Notwithstanding the satisfaction and discharge of this First Lien Indenture, if money shall have been deposited with the Trustee pursuant to Section 11.01(a)(2)(A), the provisions of Section 11.02 and Section 8.06 shall survive.

Section 11.02. Application of Trust Money.

(a) Subject to the provisions of Section 8.06, all money deposited with the Trustee pursuant to Section 11.01 shall be held in trust and applied by it, in accordance with the provisions of the First Lien Notes and this First Lien Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal, premium, if any, and interest for whose payment such money has been deposited with the Trustee, but such money need not be segregated from other funds except to the extent required by law.

 

129

(b) If the Trustee or Paying Agent is unable to apply any money or Government Securities in accordance with Section 11.01 by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s and any Guarantor’s obligations under this First Lien Indenture, the First Lien Notes and the Note Guarantees shall be revived and reinstated as though no deposit had occurred pursuant to Section 11.01; provided that if the Company has made any payment of principal of, premium, if any, or interest on, any First Lien Notes because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such First Lien Notes to receive such payment from the money or Government Securities held by the Trustee or Paying Agent, as the case may be.

ARTICLE 12

COLLATERAL

Section 12.01. Security Documents.

(a) The payment of the Obligations, including payment of the principal of and interest and premium on, if any, the Notes when due, whether on an interest payment date, at maturity, by acceleration, repurchase, redemption or otherwise, and the performance of all other Obligations of the Company, the Co-Obligor and the Guarantors under this First Lien Indenture, the Notes, the Note Guarantees and the Security Documents are secured as provided in the Security Documents and will be secured by the Security Documents hereafter delivered as required or permitted by this First Lien Indenture.

Section 12.02. Further Assurances.

(a) The Company will, and will cause the Co-Obligor and each Guarantor to, and the Co-Obligor and each Guarantor will, execute any and all documents, financing statements, agreements, instruments, certificates, notices and acknowledgments and take all such further actions (including the filing and recordation of financing statements, fixture filings, mortgages and/or amendments or continuations thereto and other documents), in each case, that may be required under the Security Documents, the relevant Intercreditor Agreements, or any applicable law, or which the Collateral Agent may reasonably request to (i) ensure the creation, perfection and priority of the Liens created or intended to be created under the Security Documents and (ii) to the extent required by the Security Documents, continue and maintain the security interest created by the Security Documents in the Collateral as a first lien perfected security interest, subject only to Liens permitted by this First Lien Indenture (including Permitted Liens) and the relevant Intercreditor Agreements, in each case, at the expense of the Company, the Co-Obligor or the relevant Guarantor.

(b) The Company will, and will cause the Co-Obligor and each Guarantor to, (i) correct any material defect or error that may be discovered in the execution, acknowledgment, filing or recordation of any Security Document or other document or instrument relating to any Collateral and (ii) do, execute, acknowledge, deliver, record, re-record, file, re-file, register and re-register any and all such further acts (including notices to third parties), deeds, certificates, assurances and other instruments as may be necessary or as the Collateral Agent may reasonably request from time to time in order to carry out more effectively the purposes of the Security Documents and Intercreditor Agreements, in each case, except as otherwise provided in the Security Documents and Intercreditor Agreements.

Section 12.03. Collateral Agent.

(a) In addition to the rights, protections and indemnities set forth herein, the Collateral Agent shall have all the rights and protections provided in the Security Documents.

 

130

(b) Each of the Holders by acceptance of the Notes hereby designates and appoints the Collateral Agent as its agent under this First Lien Indenture, the Security Documents and the Intercreditor Agreements and hereby irrevocably authorizes the Collateral Agent to take such action on its behalf under the provisions of this First Lien Indenture, the Security Documents and the Intercreditor Agreements and to exercise such powers and perform such duties as are expressly delegated to the Collateral Agent by the terms of this First Lien Indenture, the Security Documents and the Intercreditor Agreements, and consents and agrees to the terms of the Intercreditor Agreements and each Security Document, as the same may be in effect or may be amended, restated, supplemented or otherwise modified from time to time in accordance with their respective terms.

(c) Each of the Holders by acceptance of the Notes hereby directs the Trustee to so designate and appoint the Collateral Agent as its agent under this First Lien Indenture and the Security Documents and the Trustee hereby so designates and appoints the Collateral Agent. The Collateral Agent agrees to act as such on the express conditions contained in this Section 12.03. The provisions of this Section 12.03 are solely for the benefit of the Collateral Agent and none of the Trustee, any of the Holders, the Company, the Co-Obligor nor any of the Guarantors shall have any rights as a third-party beneficiary of any of the provisions contained herein other than as expressly provided hereunder. Each Holder agrees that any action taken by the Collateral Agent in accordance with the provision of this First Lien Indenture, the Intercreditor Agreements and the Security Documents, and the exercise by the Collateral Agent of any rights or remedies set forth herein and therein shall be authorized and binding upon all Holders. Notwithstanding any provision to the contrary contained elsewhere in this First Lien Indenture, the Security Documents and the Intercreditor Agreements, the duties of the Collateral Agent shall be ministerial and administrative in nature and the Collateral Agent shall not have any duties or responsibilities, except those expressly set forth herein and in the Security Documents and the Intercreditor Agreements to which the Collateral Agent is a party, nor shall the Collateral Agent have or be deemed to have any trust or other fiduciary relationship with the Trustee, any Holder, the Company, the Co-Obligor or any Guarantor, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this First Lien Indenture, the Security Documents and the Intercreditor Agreements or otherwise exist against the Collateral Agent. Without limiting the generality of the foregoing sentence, the use of the term “agent” in this First Lien Indenture with reference to the Collateral Agent is not intended to connote any fiduciary or other implied (or express) obligations arising under agency doctrine of any applicable law.

(d) The Collateral Agent may perform any of its duties under this First Lien Indenture, the Security Documents or the Intercreditor Agreements by or through receivers, agents, employees, attorneys-in-fact or through its related Persons and shall be entitled to advice of counsel concerning all matters pertaining to such duties, and shall be entitled to act upon, and shall be fully protected in taking action in reliance upon any advice or opinion given by legal counsel, including counsel that is an employee of or counsel to the Company, the Co-Obligor or any Guarantor. The Collateral Agent shall not be responsible for any receiver, agent, employee, attorney-in-fact or related Person that it selects as long as such selection was made in good faith.

(e) None of the Collateral Agent or any of its respective related Persons shall (i) be liable for any action taken or omitted to be taken by any of them under or in connection with this First Lien Indenture, the Notes or the transactions contemplated hereby (except for its own gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final non-appealable order), or under or in connection with the Security Documents or Intercreditor Agreements or the transactions contemplated thereby (except for its own gross negligence or willful misconduct as determined by a court of competent jurisdiction in a final non-appealable order), or

 

131

(ii) be responsible in any manner to any of the Trustee or any Holder for any recital, statement, representation, warranty, covenant or agreement made by the Company, the Co-Obligor or any Guarantor or Affiliate of the Company, the Co-Obligor or any Guarantor, or any officer or related Person thereof, contained in this First Lien Indenture, or any Security Documents or Intercreditor Agreements, or in any certificate, report, statement or other document referred to or provided for in, or received by the Collateral Agent under or in connection with, this First Lien Indenture, the Notes, the Security Documents or the Intercreditor Agreements, or the validity, effectiveness, genuineness, enforceability or sufficiency of this First Lien Indenture, the Security Documents or the Intercreditor Agreements, or for any failure of the Company, the Co-Obligor or any Guarantor or any other party to this First Lien Indenture, the Security Documents or the Intercreditor Agreements to perform its obligations hereunder or thereunder. None of the Collateral Agent or any of its respective related Persons shall be under any obligation to the Trustee or any Holder to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, this First Lien Indenture, the Notes, the Security Documents or the Intercreditor Agreements or to inspect the properties, books, or records of the Company, the Co-Obligor, any Guarantor or any of the Company’s, the Co-Obligor’s or Guarantors’ Affiliates.

(f) The Collateral Agent shall be entitled to rely, and shall be fully protected in conclusively relying, upon any writing, resolution, notice, consent, certificate, opinion, affidavit, letter, telegram, facsimile, certification, telephone message, statement, or other communication, document or conversation (including those by telephone or e-mail) believed by it to be genuine and correct and to have been signed, sent, or made by the proper Person or Persons, and upon advice and statements of legal counsel (including, without limitation, counsel that is an employee of or counsel to the Company, the Co-Obligor or any Guarantor), independent accountants and other experts and advisors selected by the Collateral Agent. The Collateral Agent shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, or other paper or document. The Collateral Agent shall be fully justified in failing or refusing to take any action under this First Lien Indenture, the Notes, the Security Documents or the Intercreditor Agreements, unless it shall first be directed by the Trustee acting upon the direction of the Holders of a majority in aggregate principal amount of the Notes in accordance with the terms hereof and under the Notes and, if it so requests, it shall first be indemnified to its reasonable satisfaction by the Holders against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. The Collateral Agent shall in all cases be fully protected and held harmless in acting, or in refraining from acting, under this or any other indenture, the Notes, the Security Documents or the Intercreditor Agreements in accordance with a request, direction, instruction or consent of the Trustee or the Holders of a majority in aggregate principal amount of the then outstanding Notes and such request and any action taken or failure to act pursuant thereto shall be binding upon all of the Holders.

(g) The Collateral Agent shall not be deemed to have knowledge or notice of the occurrence of any Default or Event of Default, unless a Responsible Officer of the Collateral Agent shall have received written notice from the Trustee or the Company referring to this First Lien Indenture, describing such Default or Event of Default and stating that such notice is a “notice of default.” The Collateral Agent shall take such action with respect to such Default or Event of Default as may be requested by the Trustee in accordance with Article 6 or the Holders of a majority in aggregate principal amount of the Notes in accordance with the terms hereof.

 

132