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): February 7, 2018
 
THE BON-TON STORES, INC.
(Exact name of registrant as specified in its charter)
 
Pennsylvania
 
 
 
0-19517
 
 
 
23-2835229
 
(State or Other Jurisdiction of
Incorporation) 
 
 
(Commission File Number)
 
 
(IRS Employer Identification No.)
   
2801 E. Market Street, York, Pennsylvania 17402
(Address of Principal Executive Offices)
 
717-757-7660
(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))

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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.
 
As previously disclosed, on February 4, 2018, the Bon-Ton Stores, Inc. (the “Company”) and certain of its direct and indirect subsidiaries (collectively, the “Debtors”) filed voluntary petitions for relief under chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Company’s chapter 11 cases (the “Chapter 11 Cases”) are being administered under the caption “In re: The Bon-Ton Stores, Inc., et al.” Case No. 18-10248.
 
On February 7, 2018, the Company entered into a Senior Secured, Super-Priority Debtor-in-Possession Loan and Security Agreement (the “DIP Credit Agreement”) among the Company, the other Debtors, Bank of America, N.A., as administrative agent and co-collateral agent, Wells Fargo Bank, National Association, as co-collateral agent, and certain other agents and lenders party thereto.  The DIP Credit Agreement provides for a senior secured super-priority credit facility in an aggregate principal amount of up to $725 million, subject to the terms and conditions detailed therein.  Approximately $525 million in pre-petition obligations, including letters of credit, under the Second Amended and Restated Loan and Security Agreement (the “Prepetition ABL Agreement”), dated as of March 21, 2011, by and among The Bon-Ton Department Stores, Inc., the Company, the other obligors thereunder, certain financial institutions as lenders and Bank of America, N.A., as agent, will be rolled into the DIP Credit Agreement and will constitute obligations thereunder.  Accrued and unpaid interest under the Prepetition ABL Agreement and related fees and expenses (other than certain prepayment premiums) were paid in cash on the closing date of the DIP Credit Agreement.
 
The stated maturity of the DIP Credit Agreement is November 1, 2018.  Borrowings of Tranche A Loans under the DIP Credit Agreement will bear interest at a rate equal to LIBOR plus 2.75% or Base Rate plus 1.75% per annum payable in cash.  Borrowings of Tranche A-1 Loans under the DIP Credit Agreement will bear interest at a Rate equal to LIBOR plus 9.5% or Base Rate plus 8.5% per annum payable in cash.
 
The Debtors used the proceeds of the DIP Credit Agreement on the closing date of the DIP Credit Agreement to refinance the Prepetition ABL Agreement (as described above), to pay certain fees and expenses related to the DIP Credit Agreement and to pay accrued and unpaid interest and certain fees and expenses (as described above) under the Prepetition ABL Agreement.  After the closing date of the DIP Credit Agreement, the Debtors expect to use the proceeds of the DIP Credit Agreement to pay the costs and expenses of administering the Chapter 11 Cases and to finance working capital and other general corporate needs, subject to the terms and conditions of the DIP Credit Agreement and an interim and final order entered by the Bankruptcy Court (the “DIP Order”).  The DIP Credit Agreement includes an increase in the aggregate borrowing base for excess availability and a decrease in the minimum excess availability covenant, and will provide additional liquidity to the Company.
 
The obligations under the DIP Credit Agreement constitute, subject to a carve-out for professional fees and expenses, super-priority administrative expense claims in the Chapter 11 Cases, secured by first priority security interests and liens on all present and post-petition property of the Debtors, which security interests and liens are subject only to the professional fee carve-out and certain other permitted priority and approved liens specified in the DIP Order or permitted under the DIP Credit Agreement.
 
The DIP Credit Agreement provides that the Debtors must comply with certain budgets approved by the lenders set forth therein. The DIP Credit Agreement also contains certain covenants which, among other things, and subject to certain exceptions, require the Debtors to comply with certain milestones and restrict the Debtors’ ability to incur additional debt or liens, pay dividends, prepay certain other indebtedness, sell, transfer, lease, or dispose of assets, and make investments in or merge with another company. If the Debtors were to violate any of the covenants under the DIP Credit Agreement and were unable to obtain a waiver, it would be considered a default.  If the Debtors were in default under the DIP Credit Agreement, no additional borrowings thereunder would be available unless the default were waived or cured.  If an Event of Default (as defined in the DIP Credit Agreement) occurred, the Agent would have the right, among other things, to declare all obligations immediately due and payable.  The DIP Credit Agreement provides for customary events of default.
 
 

 
The description of the DIP Credit Agreement above is subject to the terms thereof, a copy of which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.

Item 2.03       Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of the Registrant.
 
The information set forth in Item 1.01 of this Current Report is incorporated herein by reference.
Cautionary Information Regarding Trading in the Company’s Securities.

The Company cautions that trading in the Companys securities during the pendency of the Chapter 11 Cases is highly speculative and poses substantial risks. Trading prices for the Companys securities may bear little or no relationship to the actual value realized, if any, by holders of the Companys securities in the Chapter 11 Cases. Accordingly, the Company urges extreme caution with respect to existing and future investments in its securities.

Forward-Looking Statements.

Certain information included in this Current Report and in other communications made by the Company contain statements that are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995.  Such forward-looking statements, which may be identified by words such as “may,” “could,” “will,” “plan,” “expect,” “anticipate,” “believe,” “estimate,” “project,” “intend,” or other similar expressions, involve important risks and uncertainties that could significantly cause future results to differ from those expressed in any forward-looking statements.  Factors that could cause such differences include, but are not limited to: risks related to retail businesses generally; deterioration of general economic conditions; potential increases in pension obligations; consumer spending patterns, debt levels, and the availability and cost of consumer credit; additional competition from existing and new competitors or changes in the competitive environment; changes in energy and transportation costs; weather conditions that could negatively impact sales; the ability to attract and retain qualified management; the dependence upon relationships with vendors and their factors; a data security breach or system failure; the ability to reduce or control SG&A expenses; operational disruptions; unsuccessful marketing initiatives; the ability to improve efficiency through the Company’s eCommerce fulfillment center; changes in, or the failure to successfully implement, our key strategies, including the store rationalization program and initiatives to improve our merchandising, marketing and operations; adverse outcomes in litigation; the ability to obtain financing for working capital, capital expenditures and general corporate purposes; the impact of regulatory requirements; the financial condition of mall operators; and the  uncertainties relating to the bankruptcy filing by the Company, including, but not limited to, (i) the Company’s ability to obtain Bankruptcy Court approval with respect to motions or other requests made to the Bankruptcy Court in the Chapter 11 Cases, including maintaining strategic control as debtor-in-possession; (ii) the ability of the Company and its subsidiaries to negotiate, develop, confirm and consummate a plan of reorganization; (iii) the effects of the Company’s bankruptcy filing on the Company and on the interests of various constituents; (iv) Bankruptcy Court rulings in the Chapter 11 Cases and the outcome of the Chapter 11 Cases in general; (v) the length of time that the Company will operate under Chapter 11 protection and the continued availability of operating capital during the pendency of the proceedings; (vi) risks associated with third party motions in the Chapter 11 Cases, which may interfere with the Company’s ability to confirm and consummate a plan of reorganization; (vii) the potential adverse effects of the Chapter 11 proceedings on the Company’s liquidity or results of operations; (viii) increased advisory costs to execute the Company’s reorganization; and (ix) other risks and uncertainties.  Additional factors that could cause the Company’s actual results to differ from those contained in these forward-looking statements are discussed in greater detail under Item 1A of the Company’s Annual Report on Form 10-K for fiscal 2017 and subsequent filings with the Securities and Exchange Commission.  Forward-looking statements made by the Company in this Current Report, or elsewhere, speak only as of the date on which the statements were made.  We undertake no obligation to publicly update or revise any forward-looking statement as a result of new information, future events or otherwise, except as otherwise required by law.
 
 


Item 9.01       Financial Statements and Exhibits.
 
(d) Exhibits
 
Exhibit
Number
 
 
 
Description of Exhibit
 
10.1
 
 
 
 
 
 

 

 
SIGNATURES
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
  The Bon-Ton Stores, Inc.  
       
       
 
By:
/s/ Michael G. Culhane  
    Michael G. Culhane  
    Executive Vice President – Chief Financial Officer  
       
 
Dated: February 8, 2018
 
 


EXHIBIT 10.1
 
EXECUTION VERSION
 
Published Deal CUSIP:  09776RAD5
Published Tranche A CUSIP:  09776RAE3
Published Tranche A-1 CUSIP:  09776RAF0



THE BON-TON DEPARTMENT STORES, INC.,
CARSON PIRIE SCOTT II, INC.,
BON-TON DISTRIBUTION, LLC,
MCRIL, LLC,
BONSTORES REALTY ONE, LLC
and
BONSTORES REALTY TWO, LLC,
as Borrowers,

and

THE OTHER OBLIGORS PARTY HERETO,
______________________________________________________________________________
______________________________________________________________________________
SENIOR SECURED, SUPER-PRIORITY DEBTOR-IN-POSSESSION
LOAN AND SECURITY AGREEMENT

Dated as of February 7, 2018
______________________________________________________________________________
______________________________________________________________________________

CERTAIN FINANCIAL INSTITUTIONS,
as Lenders and

BANK OF AMERICA, N.A.,
as Agent
______________________

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,
WELLS FARGO BANK, NATIONAL ASSOCIATION,
CITIZENS BANK, N.A. and
PNC CAPITAL MARKETS LLC
as Joint Lead Arrangers and Joint Book Runners
______________________

WELLS FARGO BANK, NATIONAL ASSOCIATION,
CITIZENS BANK, N.A. and
PNC BANK NATIONAL ASSOCIATION,
as Syndication Agents
______________________

BANK OF AMERICA, N.A. and WELLS FARGO BANK, NATIONAL ASSOCIATION,
as Co-Collateral Agents
______________________

CRYSTAL FINANCIAL LLC,
as Tranche A-1 Documentation Agent
 


TABLE OF CONTENTS

Page
SECTION 1.
DEFINITIONS; RULES OF CONSTRUCTION
2
1.1.
Definitions
2
1.2.
Accounting Terms
49
1.3.
Certain Matters of Construction
49
1.4.
Letter of Credit Amounts
50
1.5.
Certifications
50
1.6.
Times of Day; Rates
50
1.7.
Borrowing Notices (CashPro)
50
SECTION 2.
CREDIT FACILITIES
50
2.1.
Commitment
50
 
2.1.1.
Loans
50
 
2.1.2.
Evidence of Debt; Notes
51
 
2.1.3.
Use of Proceeds
51
 
2.1.4.
Overadvances
52
 
2.1.5.
Protective Advances
52
 
2.1.6.
Refinancing of Pre-Petition Obligations on the Closing Date
52
 
2.1.7.
Treatment of Pre-Petition Tranche A Prepayment Premium
53
 
2.1.8.
Treatment of Pre-Petition Tranche A-1 Prepayment Premium
53
 
2.1.9.
Reduction of Pre-Petition Specified Tranche A-1 Prepayment Premium
54
 
2.1.10.
Prepayment Premium Interest Accrual and Availability Calculations
54
2.2.
Voluntary Termination or Reduction of Tranche A Revolver Commitments
54
 
2.2.1.
Termination of Tranche A Revolver Commitments
54
 
2.2.2.
Reduction of Tranche A Revolver Commitments
54
2.3.
Letter of Credit Facility
54
 
2.3.1.
Issuance of Letters of Credit
54
 
2.3.2.
Reimbursement; Participations
57
 
2.3.3.
Cash Collateral
58
 
2.3.4.
Role of Issuing Bank
59
 
2.3.5.
Applicability of ISP and UCP; Limitation of Liability
60
 
2.3.6.
Existing Letters of Credit
60
SECTION 3.
INTEREST, FEES AND CHARGES
60
3.1.
Interest
60
 
 
 
i

TABLE OF CONTENTS
(continued)
Page
 
3.1.1.
Rates and Payment of Interest
60
 
3.1.2.
Application of Adjusted LIBOR to Outstanding Loans
61
 
3.1.3.
Interest Periods
61
 
3.1.4.
Interest Rate Not Ascertainable
62
3.2.
Fees
63
 
3.2.1.
Unused Line Fee
63
 
3.2.2.
LC Facility Fees
64
 
3.2.3.
Fee Letters
64
 
3.2.4.
Payment of Fees Generally
64
3.3.
Computation of Interest, Fees, Yield Protection
64
3.4.
Reimbursement Obligations
64
 
3.4.1.
Generally
64
 
3.4.2.
Agent’s Advisors
66
 
3.4.3.
Fees and Expenses as Obligations
66
3.5.
Illegality
66
3.6.
Increased Costs
67
3.7.
Capital Adequacy
68
3.8.
Mitigation
69
3.9.
Funding Losses
69
3.10.
Maximum Interest
69
SECTION 4.
LOAN ADMINISTRATION
70
4.1.
Manner of Borrowing and Funding Loans
70
 
4.1.1.
Notice of Borrowing
70
 
4.1.2.
Fundings by Lenders
70
 
4.1.3.
Swingline Loans; Settlement
71
 
4.1.4.
Notices
71
4.2.
Defaulting Lender
71
 
4.2.1.
Reallocation of Payments
71
 
4.2.2.
Defaulting Lender Cure
73
4.3.
Number and Minimum Amount of LIBOR Loans; Determination of Rate
73
4.4.
Borrower Agent
73
4.5.
Reserved
73
 
 
ii

 
TABLE OF CONTENTS
(continued)
Page
4.6.
Effect of Termination
74
SECTION 5.
PAYMENTS
74
5.1.
General Payment Provisions
74
5.2.
Repayment of Loans
75
 
5.2.1.
Voluntary Prepayments of Loans
75
 
5.2.2.
Mandatory Prepayments
75
5.3.
Payment of Other Obligations
76
5.4.
Marshaling; Payments Set Aside
76
5.5.
Application of Proceeds
76
 
5.5.1.
Pre-Default Allocation of Proceeds
76
 
5.5.2.
Post-Default Allocation of Proceeds
77
 
5.5.3.
Erroneous Application
79
5.6.
Application of Dominion Account Proceeds
79
5.7.
Loan Account; Account Stated
80
 
5.7.1.
Loan Account
80
 
5.7.2.
Entries Binding
80
5.8.
Taxes
80
 
5.8.1.
Payments Free of Taxes; Obligation to Withhold; Payments on Account of Taxes
80
 
5.8.2.
Payment of Other Taxes by the Borrowers
81
 
5.8.3.
Tax Indemnifications
81
 
5.8.4.
Evidence of Payments
81
 
5.8.5.
Status of Lenders; Tax Documentation
81
 
5.8.6.
Treatment of Certain Refunds
83
 
5.8.7.
Survival
84
5.9.
[Reserved]
84
5.10.
Nature and Extent of Each Borrower’s Liability
84
 
5.10.1.
Joint and Several Liability
84
 
5.10.2.
Waivers
84
 
5.10.3.
Extent of Liability; Contribution
85
 
5.10.4.
Joint Enterprise
85
 
5.10.5.
Subordination
86
5.11.
Super Priority Nature of Obligations and Agent’s Liens
86
 
 
iii

 
TABLE OF CONTENTS
(continued)
Page
5.12.
Payment of Obligations
86
SECTION 6.
CONDITIONS PRECEDENT
86
6.1.
Conditions Precedent to Effectiveness
86
6.2.
Conditions Precedent to All Credit Extensions
89
6.3.
Limited Waiver of Conditions Precedent
90
SECTION 7.
COLLATERAL
90
7.1.
Grant of Security Interest
90
7.2.
Lien on Deposit Accounts; Cash Collateral
91
 
7.2.1.
Deposit Accounts
91
 
7.2.2.
Cash Collateral
92
7.3.
Real Estate Collateral
92
7.4.
Effect of the Order; Conflict with the Order
92
7.5.
Other Collateral
92
 
7.5.1.
Commercial Tort Claims
92
 
7.5.2.
Certain After-Acquired Collateral
92
7.6.
No Assumption of Liability
93
7.7.
Further Assurances
93
7.8.
Pre-Petition Filings and Mortgages
93
7.9.
Lien Releases
93
7.10.
Pre-Petition Securities Pledge Agreement.
93
SECTION 8.
COLLATERAL ADMINISTRATION
94
8.1.
Collateral Reporting
94
 
8.1.1.
Borrowing Base Certificates
94
 
8.1.2.
Other Collateral Reporting
95
8.2.
Administration of Accounts and Credit Card Receivables
95
 
8.2.1.
Credit Card Notifications; Records
95
 
8.2.2.
Account Verification
96
 
8.2.3.
Maintenance of Dominion Accounts
96
 
8.2.4.
Proceeds of Collateral
96
8.3.
Administration of Inventory
96
 
8.3.1.
Records and Reports of Inventory
96
 
8.3.2.
Returns of Inventory
96
 
 
iv

TABLE OF CONTENTS
(continued)
Page
 
8.3.3.
Acquisition, Sale and Maintenance
96
8.4.
Administration of Equipment
96
 
8.4.1.
Records and Schedules of Equipment
97
 
8.4.2.
Dispositions of Equipment
97
 
8.4.3.
Condition of Equipment
97
8.5.
Administration of Deposit Accounts and Securities Accounts
97
8.6.
General Provisions
97
 
8.6.1.
Location of Collateral
98
 
8.6.2.
Insurance of Collateral; Condemnation Proceeds
98
 
8.6.3.
Protection of Collateral
98
 
8.6.4.
Defense of Title to Collateral
98
8.7.
Power of Attorney
98
SECTION 9.
REPRESENTATIONS AND WARRANTIES
99
9.1.
General Representations and Warranties
99
 
9.1.1.
Organization and Qualification
99
 
9.1.2.
Power and Authority; No Conflict
99
 
9.1.3.
Enforceability
99
 
9.1.4.
Capital Structure
99
 
9.1.5.
Corporate Names; Locations
100
 
9.1.6.
Title to Properties; Priority of Liens
100
 
9.1.7.
Security Documents
100
 
9.1.8.
Financial Statements; Approved Budget; No Material Adverse Effect
101
 
9.1.9.
Surety Obligations
101
 
9.1.10.
Taxes
101
 
9.1.11.
Brokers
101
 
9.1.12.
Intellectual Property
101
 
9.1.13.
Governmental Approvals; Other Consents
102
 
9.1.14.
Compliance with Laws
102
 
9.1.15.
Compliance with Environmental Laws
102
 
9.1.16.
Burdensome Contracts
103
 
9.1.17.
Litigation
103
 
9.1.18.
Insurance; No Casualty
103
 
 
v

TABLE OF CONTENTS
(continued)
Page
 
9.1.19.
No Defaults
103
 
9.1.20.
ERISA; Foreign Plans
103
 
9.1.21.
Trade Relations
104
 
9.1.22.
Labor Matters
104
 
9.1.23.
Not a Regulated Entity
104
 
9.1.24.
Margin Stock
104
 
9.1.25.
Plan Assets
104
 
9.1.26.
Complete Disclosure
105
 
9.1.27.
Anti-Terrorism
105
 
9.1.28.
Anti-Corruption Laws
105
 
9.1.29.
EEA Financial Institution
105
 
9.1.30.
Chapter 11 Cases
105
SECTION 10.
COVENANTS AND CONTINUING AGREEMENTS
106
10.1.
Affirmative Covenants
106
 
10.1.1.
Inspections; Valuations; Appraisals
106
 
10.1.2.
Financial and Other Information
106
 
10.1.3.
Notices
109
 
10.1.4.
Storage Agreements
110
 
10.1.5.
Compliance with Laws; Organic Documents; Material Contracts
110
 
10.1.6.
Taxes
110
 
10.1.7.
Insurance
111
 
10.1.8.
Licenses
111
 
10.1.9.
Future Subsidiaries; Designation of Subsidiaries
111
 
10.1.10.
  Reserved
111
 
10.1.11.
  Preservation of Existence
111
 
10.1.12.
  Maintenance of Properties
111
 
10.1.13.
  Books and Records
111
 
10.1.14.
  Operation and Maintenance Plan
111
 
10.1.15.
  Anti-Corruption Laws
112
 
10.1.16.
  Obligor’s Advisors; Cooperation
112
 
10.1.17.
  Approved Budget
113
 
10.1.18.
  Required Milestones
114
 
 
vi

TABLE OF CONTENTS
(continued)
Page
 
10.1.19.
  Leases
114
 
10.1.20.
  Debtor-In-Possession Obligations
115
 
10.1.21.
  Status of Specified Store Closing Sales; Specified Transaction
115
 
10.1.22.
  Collateral Updates
115
10.2.
Negative Covenants
115
 
10.2.1.
Permitted Debt
115
 
10.2.2.
Permitted Liens
116
 
10.2.3.
Distributions; Upstream Payments
119
 
10.2.4.
Restricted Investments
119
 
10.2.5.
Disposition of Assets
119
 
10.2.6.
Loans
119
 
10.2.7.
Fundamental Changes; Subsidiaries
119
 
10.2.8.
  Accounting Changes; Fiscal Year; Tax Consolidation
119
 
10.2.9.
  Restrictive Agreements
119
 
10.2.10.
  Hedging Agreements
119
 
10.2.11.
  Conduct of Business
119
 
10.2.12.
  Affiliate Transactions
120
 
10.2.13.
  Plans
120
 
10.2.14.
  Amendments to Senior Note Debt Documents, Organic Documents
120
 
10.2.15.
  No Speculative Transactions
120
 
10.2.16.
  [Reserved]
120
 
10.2.17.
  Use of Proceeds
120
 
10.2.18.
  No Inconsistent Agreements
120
 
10.2.19.
  Stay, Extension and Usury Laws
120
 
10.2.20.
  Sanctions
120
 
10.2.21.
  Anti-Corruption Laws
120
 
10.2.22.
  Sale-Leaseback Transactions
121
 
10.2.23.
  Prepayments of Other Debt
121
 
10.2.24.
  Repayments of Debt
121
 
10.2.25.
  Reclamation Claims
121
 
10.2.26.
  Insolvency Proceeding Claims
121
 
10.2.27.
  Bankruptcy Actions
121
 
 
vii

TABLE OF CONTENTS
(continued)
Page
 
10.2.28.
  Right of Subrogation
121
10.3.
Minimum Excess Availability
121
SECTION 11.
EVENTS OF DEFAULT; REMEDIES ON DEFAULT
122
11.1.
Events of Default
122
11.2.
Remedies upon Default
128
11.3.
License; Access; Cooperation
130
11.4.
Setoff
130
11.5.
Remedies Cumulative; No Waiver
130
 
11.5.1.
Cumulative Rights
130
 
11.5.2.
Waivers
130
11.6.
Lift of Automatic Stay
131
SECTION 12.
AGENT
131
12.1.
Appointment, Authority and Duties of Agent
131
 
12.1.1.
Appointment and Authority
131
 
12.1.2.
Duties
132
 
12.1.3.
Agent Professionals
133
 
12.1.4.
Instructions of Required Lenders
133
 
12.1.5.
Co-Collateral Agents
133
 
12.1.6.
No Fiduciary Relationship
133
12.2.
Agreements Regarding Collateral and Field Examination Reports
133
 
12.2.1.
Collateral and Guaranty Matters
133
 
12.2.2.
Possession of Collateral
135
 
12.2.3.
Reports
135
12.3.
Reliance By Agent
135
12.4.
Action Upon Default
135
12.5.
Ratable Sharing
136
12.6.
Indemnification of Agent Indemnitees
136
 
12.6.1.
INDEMNIFICATION
136
 
12.6.2.
Proceedings
136
12.7.
Limitation on Responsibilities of Agent
137
12.8.
Successor Agent
137
 
12.8.1.
Resignation; Successor Agent
137
 
 
viii

TABLE OF CONTENTS
(continued)
Page
 
12.8.2.
Separate Collateral Agent
137
12.9.
Due Diligence and Non-Reliance
138
12.10.
Replacement of Certain Lenders
138
12.11.
Remittance of Payments and Collections
139
 
12.11.1.
  Remittances Generally
139
 
12.11.2.
  Failure to Pay
139
 
12.11.3.
  Recovery of Payments
139
12.12.
Agent in its Individual Capacity
139
12.13.
Agent Titles
139
12.14.
No Third Party Beneficiaries
139
12.15.
[Reserved]
140
12.16.
Agent May File Proofs of Claim
140
12.17.
Bank Product Providers
140
SECTION 13.
BENEFIT OF AGREEMENT; ASSIGNMENTS AND PARTICIPATIONS
140
13.1.
Successors and Assigns
140
13.2.
Assignments
141
 
13.2.1.
Assignments by Lenders
141
 
13.2.2.
Register
143
 
13.2.3.
Certain Pledges
143
 
13.2.4.
Electronic Execution of Assignments and Certain Other Documents
143
 
13.2.5.
Assignment by MLPFS
143
13.3.
Participations
143
 
13.3.1.
Participations
143
 
13.3.2.
Limitations upon Participant Rights
144
13.4.
Tax Treatment
144
13.5.
Representation of Lenders
144
SECTION 14.
MISCELLANEOUS
146
14.1.
Consents, Amendments and Waivers
146
 
14.1.1.
Amendment
146
 
14.1.2.
Limitations
147
 
14.1.3.
Payment for Consents
148
 
14.1.4.
Generally
148
 
 
ix

TABLE OF CONTENTS
(continued)
Page
14.2.
Indemnity
148
14.3.
Notices and Communications
149
 
14.3.1.
Notice Address
149
 
14.3.2.
Electronic Communications; Voice Mail
149
 
14.3.3.
Non-Conforming Communications
150
 
14.3.4.
Change of Address, Etc
150
14.4.
Performance of Borrowers’ Obligations
150
14.5.
Credit Inquiries
150
14.6.
Severability
150
14.7.
Cumulative Effect; Conflict of Terms
151
14.8.
Counterparts; Facsimile Signatures
151
14.9.
Entire Agreement
151
14.10.
Obligations of Lenders
151
14.11.
Confidentiality
151
14.12.
GOVERNING LAW
152
14.13.
SUBMISSION TO JURISDICTION, ETC
152
 
14.13.1.
  SUBMISSION TO JURISDICTION
152
 
14.13.2.
  WAIVER OF VENUE
152
 
14.13.3.
  SERVICE OF PROCESS
153
14.14.
CERTAIN WAIVERS
153
14.15.
Patriot Act Notice
153
14.16.
Survival of Representations and Warranties
154
14.17.
No Advisory or Fiduciary Responsibility
154
14.18.
Resignation as Issuing Bank or Provider of Swingline Loans after Assignment
154
14.19.
Senior Note Intercreditor Agreement
155
14.20.
Keepwell
155
14.21.
Acknowledgment and Consent to Bail-In of EEA Financial Institutions
155
14.22.
Agreement Among Tranche A Lenders and the Tranche A-1 Lenders
156
14.23.
MIRE Event
156
 
x

LIST OF EXHIBITS AND SCHEDULES
Exhibit A
Tranche A Revolver Note
Exhibit B
Tranche A-1 Revolver Note
Exhibit C
Assignment and Assumption Agreement
Exhibit D
Compliance Certificate
Exhibit E
Credit Card Notification
Exhibit F
Guaranty
Exhibit G
Co-Collateral Agent Rights Agreement
Exhibit H
Joinder to Credit Agreement
Exhibit I
U.S. Tax Compliance Certificates
Exhibit J
Closing Checklist
Exhibit K
Interim Order
 
Schedule 1.1(a)
Commitments of Lenders
Schedule 1.1(b)
Restricted Investments Existing on the Closing Date
Schedule 1.1(c)
Certain Existing Bank Products
Schedule 1.1(d)
Specified Store Closing Sale Locations
Schedule 1.1(e)
Pre-Petition Mortgages
Schedule 2.3.6
Existing Letters of Credit
Schedule 7.1(c)
Commercial Tort Claims
Schedule 7.3
Mortgaged Real Estate
Schedule 8.2.1
Existing Credit Card Arrangements
Schedule 8.5
Deposit Accounts and Securities Accounts
Schedule 8.5(a)
Excluded Deposit and Disbursement Accounts
Schedule 8.6.1
Chief Executive Offices and other Business Locations
Schedule 9.1.4
Capital Structure
Schedule 9.1.5
Entity Information; Former Corporate Names and Trade Names
Schedule 9.1.6(i)
Owned Real Estate
Schedule 9.1.6(ii)
Leased Real Estate
Schedule 9.1.8
Financial Statements
Schedule 9.1.11
Investment Bankers
Schedule 9.1.12
Intellectual Property
Schedule 9.1.15
Environmental Matters
Schedule 9.1.16
Restrictive Agreements
Schedule 9.1.17
Litigation
Schedule 9.1.19
Material Defaults
Schedule 9.1.22
Labor Contracts
Schedule 10.1.18
Required Milestones
Schedule 10.2.1
Existing Debt
Schedule 10.2.2
Existing Liens
Schedule 10.2.2(c)
Existing Tax Liens
Schedule 10.2.12
Existing Affiliate Transactions
Schedule 14
Agreement Among Tranche A Lenders and Tranche A-1 Lenders
   
Annex A
Approved Budget
 

SENIOR SECURED, SUPER-PRIORITY DEBTOR-IN-POSSESSION
LOAN AND SECURITY AGREEMENT
This SENIOR SECURED, SUPER-PRIORITY DEBTOR-IN-POSSESSION LOAN AND SECURITY AGREEMENT, dated as of February 7, 2018 (as amended, amended and restated, restated, supplemented or otherwise modified from time to time, this “Loan Agreement”), is by and among THE BON-TON DEPARTMENT STORES, INC. (“Bon-Ton”), a Pennsylvania corporation, CARSON PIRIE SCOTT II, INC., a Florida corporation (“CPS II”), BON-TON DISTRIBUTION, LLC, an Illinois limited liability company (“Distribution”), MCRIL, LLC, a Virginia limited liability company (“McRIL”), BONSTORES REALTY ONE, LLC, a Delaware limited liability company (“BR1LLC”), and BONSTORES REALTY TWO, LLC, a Delaware limited liability company (“BR2LLC” and, together with Bon-Ton, CPS II, Distribution, McRIL, BR1LLC and any other person from time to time a borrower hereunder, collectively, the “Borrowers”), each of the other Obligors party hereto, the financial institutions party to this Loan Agreement from time to time as lenders (collectively, “Lenders”), and BANK OF AMERICA, N.A., a national banking association, as administrative agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, the “Agent”), with MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, WELLS FARGO BANK, NATIONAL ASSOCIATION, CITIZENS BANK, N.A. and PNC CAPITAL MARKETS LLC acting as joint lead arrangers and joint bookrunners hereunder (in such capacity, the “Joint Lead Arrangers”), WELLS FARGO BANK, NATIONAL ASSOCIATION, CITIZENS BANK, N.A. and PNC BANK NATIONAL ASSOCIATION acting as syndication agents (in such capacity, the “Syndication Agents”), BANK OF AMERICA, N.A. and WELLS FARGO BANK, NATIONAL ASSOCIATION acting as co-collateral agents hereunder (in such capacity, together with their permitted successors and assigns in such capacity, the “Co-Collateral Agents”) and CRYSTAL FINANCIAL LLC, acting as documentation agent for the Tranche A-1 Lenders (in such capacity, the “Tranche A-1 Documentation Agent”).
R E C I T A L S:
WHEREAS, on February 4, 2018 (the “Petition Date”), (a) The Bon-Ton Stores, Inc., a Pennsylvania corporation, (b) Bon-Ton, (c) CPS II, (d) Distribution, (e) McRIL, (f) BR1LLC, (g) BR2LLC, (h) The Bon-Ton Giftco, LLC, a Virginia limited liability company, (i) Bonstores Holdings One, LLC, a Delaware limited liability company, and (j) Bonstores Holdings Two, LLC, a Delaware limited liability company (the Persons specified in the foregoing clauses (a) through (j), collectively, the “Debtors” and each individually, a “Debtor”), commenced Chapter 11 Case Nos. 18-10247 through 18-10256, as administratively consolidated at Chapter 11 Case No. 18-10248 (collectively, the “Chapter 11 Cases” and each individually, a “Chapter 11 Case”) with the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”);
WHEREAS, the Debtors continue to operate their businesses and manage their properties as debtors and debtors-in-possession pursuant to Sections 1107(a) and 1108 of the Bankruptcy Code;
WHEREAS, prior to the Petition Date, the Lenders provided financing to the Borrowers pursuant to that certain Second Amended and Restated Loan and Security Agreement, dated as of March 21, 2011, among the Borrowers, the other obligors party thereto, the Pre-Petition Lenders, Bank of America, as the Pre-Petition Agent, and the other parties thereto (as amended, amended and restated, restated, supplemented or otherwise modified through the Petition Date, the “Pre-Petition Loan Agreement”);
WHEREAS, on the Petition Date, the Pre-Petition Lenders under the Pre-Petition Loan Agreement were owed: (a) not less than $338,300,000 in outstanding principal of Tranche A Revolver Loans (as such term is defined in Pre-Petition Loan Agreement); (b) not less than $150,000,000 in outstanding principal balance of the Tranche A-1 Revolver Loans (as such term is defined in Pre-Petition Loan Agreement); and (c) not less than $36,396,243.91 in maximum aggregate amounts available to be

drawn under outstanding Letters of Credit (as such term is defined in Pre-Petition Loan Agreement), plus interest, fees, costs and expenses and all other Pre-Petition Obligations under the Pre-Petition Loan Agreement;
WHEREAS, the Obligations, under and as defined in the Pre-Petition Loan Agreement, are secured by a security interest in substantially all of the existing and after-acquired assets of the Borrowers and the Guarantors as more fully set forth in the Pre-Petition Loan Documents and such security interest is perfected as described in the Pre-Petition Loan Documents and has priority over other security interests (as described in the Pre-Petition Loan Documents);
WHEREAS, the Borrowers have requested, and, upon the terms set forth in this Loan Agreement, the Lenders have agreed to make available to the Borrowers, a senior secured, super-priority credit facility in an aggregate principal amount of up to $725,000,000 to fund the working capital requirements of the Obligors during the pendency of the Chapter 11 Cases, consisting of (a) $600,000,000 in Tranche A Revolver Commitments and (b) $125,000,000 in Tranche A-1 Revolver Loans;
WHEREAS, each Borrower and each Guarantor has agreed to secure all of its Obligations under the Loan Documents by granting to the Agent, for the benefit of the Agent and the other Secured Parties, a security interest in and lien upon all of their existing and after-acquired personal and real property.
WHEREAS, the Borrowers’ and Guarantors’ business is a mutual and collective enterprise and the Borrowers and the Guarantors believe that the loans and other financial accommodations provided to the Borrowers under this Loan Agreement will enhance the aggregate borrowing powers of the Borrowers and facilitate the administration of the Chapter 11 Cases and their loan relationship with the Agent and the Lenders, all to the mutual advantage of the Borrowers and the Guarantors;
WHEREAS, each Borrower and each Guarantor acknowledges that it will receive substantial direct and indirect benefits by reason of the making of loans and other financial accommodations to the Borrowers as provided in this Loan Agreement; and
WHEREAS, the Agent’s and the Lenders’ willingness to extend financial accommodations to the Borrowers, as more fully set forth in this Loan Agreement and the other Loan Documents, is done solely as an accommodation to the Borrowers and the Guarantors and at the Borrowers’ and the Guarantors’ request and in furtherance of the Borrower’s and the Guarantors’ mutual and collective enterprise.
NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged (these recitals being an integral part of this Loan Agreement), the parties hereto hereby agree as follows:
SECTION 1.         DEFINITIONS; RULES OF CONSTRUCTION
1.1.         Definitions.  As used herein, the following terms have the meanings set forth below:
Account” - as defined in the UCC, including all rights to payment for goods sold or leased, or for services rendered.
Account Control Agreements” - with respect to any Deposit Account, each deposit account control agreement and other bank account control agreement required pursuant to Section 7.2.1 or Section 8.5, and with respect to any Securities Account, each securities account control agreement required pursuant to Section 8.5, in each case, in form and substance reasonably satisfactory to Agent.
2

Account Debtor” - a Person who is obligated under an Account, Chattel Paper or General Intangible.
Actual Disbursement Amount” - the sum of all disbursements, expenses and payments made by the Obligors during the relevant period of determination which corresponds to the disbursements, expenses and payments described under the headings “Operating Disbursements” and “Total Bankruptcy Costs” in the Approved Budget, as determined in a manner consistent with the Approved Budget.
Actual Specified Receipts” - the sum of all cash receipts received by the Obligors (excluding, for the avoidance of doubt, any borrowings under this Loan Agreement) from the sale of any Property of the Obligors (other than pursuant to the Specified Store Closing Sales) during the relevant period of determination which corresponds to the cash receipts described under the heading “Non-GOB Sales” in the Approved Budget, as determined in a manner consistent with the Approved Budget.
Actual Inventory Levels” - the actual aggregate consolidated retail stock ledger Inventory levels of the Obligors as of the relevant date of determination which correspond to the budgeted consolidated retail stock ledger Inventory levels of the Obligors contained in borrowing base appendix portion of the Approved Budget opposite the heading “Inventory at Retail in Borrowing Base” and the sub-heading “Forecast”, as determined in a manner consistent with the Approved Budget.
Adequate Protection Liens” - has the meaning assigned to the term “Prepetition ABL Adequate Protection Liens” in the Interim Order (or the Final Order, when applicable).
Adequate Protection Payments” - the adequate protection payments payable in cash on the dates and to the extent required by the Interim Order (or the Final Order, when applicable).
Adequate Protection Superpriority Claims” - has the meaning assigned to the term “Prepetition ABL Superpriority Claim” in the Interim Order (or the Final Order, when applicable).
Adjusted LIBOR” - (a) for any Interest Period, with respect to LIBOR Loans, the rate per annum equal to the London Interbank Offered Rate (“LIBOR”) or a comparable or successor rate, which rate is approved by the Agent, as published on the applicable Reuters screen page (or such other commercially available source providing such quotations as may be designated by the Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, for Dollar deposits (for delivery on the first day of such Interest Period) with a term equivalent to such Interest Period;
(b)               for any interest calculation with respect to a Base Rate Loan on any date, the rate per annum equal to LIBOR or a comparable or successor rate, which rate is approved by the Agent, as published on the applicable Reuters screen page (or such other commercially available source providing such quotations as may be designated by the Agent from time to time) at approximately 11:00 a.m., London time, two Business Days prior to such date for Dollar deposits with a term of one month commencing that day; and
(c)               if Adjusted LIBOR shall be less than zero, such rate shall be deemed zero for purposes of this Loan Agreement;
3

provided that to the extent a comparable or successor rate is approved by the Agent in connection herewith, the approved rate shall be applied in a manner consistent with market practice; provided, further that to the extent such market practice is not administratively feasible for the Agent, such approved rate shall be applied in a manner as otherwise reasonably determined by the Agent.  If the Board of Governors shall impose a Reserve Percentage with respect to LIBOR deposits, then Adjusted LIBOR shall equal the amount determined above, divided by (1 minus the Reserve Percentage).  Notwithstanding the foregoing, Adjusted LIBOR for purposes of LIBOR Tranche A-1 Revolver Loans shall at no time be less than one percent (1%) per annum.
Affiliate” - with respect to any Person, another Person (a) who directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with such first Person; (b) who beneficially owns 10% or more of the voting securities or any class of Capital Stock of such first Person; (c) at least 10% of whose voting securities or any class of Capital Stock is beneficially owned, directly or indirectly, by such first Person; or (d) who is an officer, director, partner or managing member of such first Person.  “Control” means the possession, directly or indirectly, of the power to direct or cause direction of the management and policies of a Person, whether through ownership of Capital Stock, by contract or otherwise.
Agency and Structuring Fee Letter” - the Agency and Structuring Fee Letter, dated as of February 7, 2018, by and among the Obligors, Bank of America and MLPFS, as amended, amended and restated, restated, supplemented or otherwise modified and in effect from time to time.
Agent” - as defined in the Preamble.
Agent’s Advisors” - as defined in Section 3.4.2.
Agent Indemnitees” - Agent and its Related Parties.
Agent Parties” - as defined in Section 10.1.2.
Agent Professionals” - attorneys, accountants, appraisers, auditors, business valuation experts, environmental engineers or consultants, turnaround consultants, and other professionals and experts retained by the Agent, including, for the avoidance of doubt, the Agent’s Advisors.
Aggregate Borrowing Base” - means, on any date of determination, collectively, the sum of the Tranche A Borrowing Base and the Tranche A-1 Borrowing Base on such date.
Allocable Amount” - as defined in Section 5.10.3.
Anti-Terrorism Laws” - any laws relating to terrorism or money laundering, including the Patriot Act.
Applicable Law” - all laws, rules, regulations and governmental guidelines applicable to the Person, conduct, transaction, agreement or matter in question, including all applicable statutory law, common law and equitable principles, and all provisions of constitutions, treaties, statutes, rules, regulations, orders and decrees of Governmental Authorities.
Applicable Margin” -
(a) with respect to any LIBOR Tranche A Revolver Loans, 2.75% per annum;
 
4

(b) with respect to any Base Rate Tranche A Revolver Loans, 1.75% per annum;
(c) with respect to any LIBOR Tranche A-1 Revolver Loans, 9.50% per annum; and
(d) with respect to any Base Rate Tranche A-1 Revolver Loans, 8.50% per annum.
Appraised Value” - the fair market value of any Eligible Real Estate as determined pursuant to the most recent appraisal received by Agent from an independent third-party appraiser reasonably acceptable to the Required Lenders, pursuant to Section 10.1.1(b).
Approved Budget” - the budget prepared by the Borrowers in the form of Annex A and initially furnished to the Agent and the Tranche A-1 Documentation Agent on the Closing Date and which is approved by, and in form and substance satisfactory to, the Agent and the Tranche A-1 Documentation Agent, each  in its sole discretion, as the same may be updated, modified or supplemented from time to time as provided in Section 10.1.17.
Approved Budget Variance Report” - a weekly report (i) provided by the Borrower Agent to the Agent and the Tranche A-1 Documentation Agent (a) showing, in each case, by line item the Actual Disbursement Amount, the Actual Specified Receipts, Actual Inventory Levels, Excess Availability, net cash flows, total cash receipts, total disbursements, and Inventory receipts and levels for the last day of the Prior Week, the Cumulative Four-Week Period and the Cumulative Period (as provided in Section 10.1.7(b), as applicable), noting therein all variances, on a line-item and cumulative basis, from the amounts set forth for such period in the Approved Budget, and shall include explanations for all material variances (including whether such variance is permanent in nature or timing related) and (b) an analysis demonstrating the Borrowers are in compliance with the budget covenants set forth in Section 10.1.17(b), and (ii) certified by a Senior Officer of the Borrower Agent.  The Approved Budget Variance Report shall be in a form, and shall contain supporting information, satisfactory to the Agent in its sole discretion.
Approved Fund” - any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.
Approved Shipper” - any reputable and creditworthy shipper or freight forwarder transporting finished goods Inventory to a Borrower’s Distribution Center.
Arrangement Fee Letter” - the Arrangement Fee Letter, dated as of February 7, 2018, by and among the Obligors, Bank of America and Wells Fargo, as amended, amended and restated, restated, supplemented or otherwise modified and in effect from time to time.
Asset Disposition” - a sale, lease, license, consignment, transfer or other disposition of Property of an Obligor, including a disposition of Property in connection with a sale-leaseback transaction or synthetic lease; provided, however, that in no event shall a termination of a lease be deemed to be an Asset Disposition.
Assignee Group” - two or more Eligible Assignees that are Affiliates of one another or two or more Approved Funds managed by the same investment advisor.
Assignment and Assumption Agreement” - an assignment and assumption agreement between a Lender and Eligible Assignee, substantially in the form of Exhibit C.
5

Automatic Stay” means the automatic stay provided under Section 362 of the Bankruptcy Code.
Availability Reserve” - the sum (without duplication) of (a) the Inventory Reserve, (b) the Credit Card Receivables Reserve, (c) the Rent and Charges Reserve, (d) the Bank Product Reserve, (e) reserves in respect of any liabilities secured by Liens upon Collateral that are or which may become senior or pari passu to Agent’s Liens (irrespective of whether such liabilities or Liens are permitted hereunder and provided that imposition of any such reserve shall not waive an Event of Default arising therefrom), (f) reserves in respect of consignment arrangements and any proceeds arising therefrom, (g) reserves in respect of the Carve Out as set forth in the DIP Order, (h) reserves in respect of the maximum amount of any other court-ordered charges or other liabilities that the Agent determines rank senior or pari passu in priority or may rank senior or pari passu in priority to the Liens securing the Obligations or Pre-Petition Obligations, and (i) such additional reserves, in such amounts and with respect to such matters as the Agent in its reasonable exercise of its credit judgment may elect to impose from time to time, including, without limitation, (i) the Lease Reserve, (ii) reserves in respect of any reclamation or similar claims as may relate to or arise during the Chapter 11 Cases that are or that the Agent reasonably believes may become senior to the Agent’s Liens, (iii) reserves in respect of accrued and unpaid interest or fees on the Obligations, (iv) reserves in respect of accrued but unpaid Taxes, including, but not limited to, ad valorem, excise, personal property, sale, use and similar taxes that the Agent determines rank senior or pari passu in priority or may rank senior or pari passu in priority to the Liens securing the Obligations or Pre-Petition Obligations, (v) reserves in respect of uninsured, underinsured, un-indemnified, or under-indemnified losses, liabilities, or potential losses or liabilities, (vi) reserves in respect of credit card or other payment processing fees owed to any credit card or other payment processor, (vii) reserves in respect of claims against, liabilities in respect of, or impediments to any realization on, the Collateral, and (viii) reserves in respect of a Default or Event of Default that has occurred and is continuing or is anticipated to occur.
Bail-In Action” - means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.
Bail-In Legislation” - means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.
Bank of America” - Bank of America, N.A., a national banking association, and its successors and permitted assigns.
Bank of America Indemnitees” - Bank of America and its officers, directors, employees, Affiliates, agents, advisors and attorneys.
Bank Product” - any of the following products, services or facilities extended to any Obligor or any Subsidiary by any Tranche A Lender or any of its Affiliates: (a) Cash Management Services; (b) products under Hedging Agreements; (c) commercial credit card and purchasing cards extended to any Obligor or any Subsidiary; (d) other banking products or services as may be requested by any Obligor or any Subsidiary, other than letters of credit and leases; (e) those other bank products and services set forth on Schedule 1.1(c); and (f) supply chain financing; provided, however, that for any of the foregoing to be included for purposes of a distribution under Section 5.5.1(m) or Section 5.5.2(n) (as applicable), the applicable bank product provider and Obligor must have provided written notice to Agent of (i) the existence of such Bank Product, (ii) the maximum dollar amount of obligations arising thereunder to be
6

included as a Bank Product Reserve (“Bank Product Amount”), and (iii) the methodology to be used by such parties in determining the Bank Product Debt owing from time to time (which notice, in the case of a distribution under Section 5.5.2(n), must have been received prior to the occurrence of the Event of Default resulting in the application of Section 5.5.2(n)).  The Bank Product Amount may be changed from time to time upon written notice to Agent by the Secured Party and Obligor.  Notwithstanding anything to the contrary contained herein, Bank Products provided by Bank of America or any of its branches or Affiliates shall not be subject to the requirements in the proviso of the first sentence of this definition in order for such Bank Products to be included as an “Obligation” for purposes of a distribution under Section 5.5.1(m) or Section 5.5.2(n) (as applicable).
Bank Product Amount” - as defined in the definition of Bank Product.
Bank Product Debt” - Debt and other obligations of an Obligor or any Subsidiary relating to Bank Products.
Bank Product Reserve” - the aggregate amount of reserves established by the Agent in the reasonable exercise of its credit judgment from time to time, in consultation with the Borrower Agent, in respect of Bank Product Debt.
Bankruptcy Code” - Title 11 of the United States Code, as amended and in effect.
Bankruptcy Court” - as defined in the Recitals.
Base Rate” - for any day, a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus 1/2 of 1%, (b) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate,” and (c) the Adjusted LIBOR for a one-month Interest Period in effect for such day (or if such day is not a Business Day, the immediately preceding Business Day) plus 1.00%.  Notwithstanding the foregoing, Base Rate for purposes of any interest calculation with respect to Tranche A-1 Revolver Loans, including pursuant to the last sentence of Section 3.1.1(a), shall at no time be less than two percent (2%) per annum.  The “prime rate” is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such publicly announced rate.  Any change in the Base Rate due to a change in any of the foregoing shall take effect at the opening of business on the day specified in the public announcement of such change.
Base Rate Loan” - any Loan that bears interest based on the Base Rate.
Base Rate Tranche A Revolver Loan” - a Tranche A Revolver Loan that bears interest at the Base Rate plus the Applicable Margin for Base Rate Tranche A Revolver Loans.
Base Rate Tranche A-1 Revolver Loan” - a Tranche A-1 Revolver Loan that bears interest at the Base Rate plus the Applicable Margin for Base Rate Tranche A-1 Revolver Loans.
Benefit Plan” - any of (a) an “employee benefit plan” (as defined in ERISA) that is subject to Title I of ERISA, (b) a “plan” as defined in Section 4975 of the IRC or (c) any Person whose assets include (for purposes of ERISA Section 3(42) or otherwise for purposes of Title I of ERISA or Section 4975 of the IRC) the assets of any such “employee benefit plan” or “plan”.
7

Board of Directors” - (a) with respect to a corporation, the board of directors of the corporation or, except in the context of the definitions of “Change of Control” and “Continuing Directors,” a duly authorized committee thereof; (b) with respect to a partnership, the Board of Directors of the general partner of the partnership or, if the partnership has more than one general partner, the managing general partner of the partnership; and (c) with respect to any other Person, the board or committee of such Person serving a similar function.
Board of Governors” - the Board of Governors of the Federal Reserve System.
Bon-Ton” - as defined in the Preamble.
Borrowed Money” - with respect to any Obligor, without duplication, its (a) Debt that (i) arises from the lending of money by any Person to such Obligor, (ii) is evidenced by notes, drafts, bonds, debentures, credit documents or similar instruments, (iii) accrues interest or is a type upon which interest charges are customarily paid (excluding trade payables owing in the Ordinary Course of Business), or (iv) was issued or assumed as full or partial payment for Property; (b) Capital Leases; (c) reimbursement obligations with respect to letters of credit; and (d) guaranties of any Debt of the foregoing types owing by another Person.
Borrower Account” - a special account established by the Borrowers, at Bank of America or another bank reasonably acceptable to the Agent, subject to a control agreement in favor of the Agent, for the benefit of the Lenders, in form and substance reasonably satisfactory to the Agent.
Borrower Agent” - as defined in Section 4.4.
Borrowing” - a group of Loans of one Type that are made on the same day or are converted into Loans of one Type on the same day.
Borrowing Base Certificate” - a certificate, in form and substance reasonably satisfactory to Agent, by which Borrowers certify calculation of the Tranche A Borrowing Base, the Tranche A-1 Borrowing Base, and the Tranche A-1 Utilization Amount.
Budgeted Disbursement Amount” - the sum of the line items contained in the Approved Budget under the headings “Operating Disbursements” and “Total Bankruptcy Costs” during the relevant period of determination.
Budgeted Specified Receipts” - the line item contained in the Approved Budget under the heading “Non-GOB Sales” in the Approved Budget during the relevant period of determination.
Budgeted Inventory Levels” - the budgeted aggregate consolidated Inventory levels of the Obligors contained in borrowing base appendix portion of the Approved Budget opposite the heading “Inventory at Retail in Borrowing Base” and the sub-heading “Forecast”, as of the relevant date of determination.
Business Day” - any day (a) excluding Saturday, Sunday and any other day on which banks are permitted to be closed under the laws of the State of New York and (b) when used with reference to a LIBOR Loan, also excluding any day on which banks do not conduct dealings in Dollar deposits on the London interbank market.
CAA” - the Clean Air Act (42 U.S.C. §7401 et seq.).
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Capital Adequacy Regulation” - any law, rule, regulation, guideline, request or directive of any central bank or other Governmental Authority, whether or not having the force of law, regarding capital adequacy or liquidity of a bank or any Person controlling a bank.
Capital Expenditures” - all liabilities incurred, expenditures made or payments due (whether or not made) by Parent or any Subsidiary for the acquisition of any fixed assets, or any improvements, replacements, substitutions or additions thereto, in each case that are required to be capitalized for financial reporting purposes in accordance with GAAP.
Capital Lease” - any lease that is required to be capitalized for financial reporting purposes in accordance with GAAP.
Capital Stock” - (a) in the case of a corporation, corporate stock; (b) in the case of an association or other 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 or membership interests (whether general, limited, limited liability or joint venture); and (d) any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.
Carve Out” - has the meaning assigned to the term “Carve Out” in paragraph 39 the Interim Order (or the corresponding paragraph of the Final Order, when applicable).
Cash Collateral” - cash, and any interest or other income earned thereon, that is delivered to Agent to Cash Collateralize any Obligations.
Cash Collateral Account” - a demand deposit, money market or other account established by Agent at such financial institution as Agent may select in its discretion, which account shall be subject to Agent’s Liens for the benefit of Secured Parties.
Cash Collateralize” - to pledge and deposit with or deliver to the Agent, for the benefit of the Agent, the applicable Issuing Bank or the Agent, in its capacity as provider of Swingline Loans (as applicable) and the Lenders, as collateral for LC Obligations, Pre-Petition LC Obligations, Obligations in respect of Swingline Loans, or obligations of Lenders to fund participations in respect of any thereof (as the context may require), cash or deposit account balances or, if the Issuing Bank or the Agent, in its capacity as provider of Swingline Loans, benefiting from such collateral shall agree in its sole discretion, other credit support, in each case pursuant to documentation in form and substance satisfactory to (a) the Agent and (b) the applicable Issuing Bank or the Agent, in its capacity as provider of Swingline Loans (as applicable).  “Cash Collateralization” shall have a meaning correlative to the foregoing and shall include the proceeds of such cash collateral and other credit support.  Where Cash Collateralization of any obligations of a Defaulting Lender is required, the amount of cash collateral so required shall equal 105% of such obligations.
Cash Equivalents” - (a) marketable obligations issued or unconditionally guaranteed by, and backed by the full faith and credit of, the United States government, maturing within 12 months of the date of acquisition; (b) certificates of deposit, time deposits and bankers’ acceptances maturing within 12 months of the date of acquisition, and overnight bank deposits, in each case which are issued by a commercial bank organized under the laws of the United States or any state or district thereof, rated A-1 (or better) by S&P or P-1 (or better) by Moody’s at the time of acquisition, and (unless issued by a Lender) not subject to offset rights; (c) repurchase obligations with a term of not more than 30 days for underlying investments of the types described in clauses (a) and (b) entered into with any bank meeting the qualifications specified in
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clause (b); (d) commercial paper rated A-1 (or better) by S&P or P-1 (or better) by Moody’s, and maturing within nine months of the date of acquisition; and (e) shares of any money market fund that has substantially all of its assets invested continuously in the types of investments referred to above, has net assets of at least $500,000,000 and has the highest rating obtainable from either Moody’s or S&P.
Cash Management Services” - any services provided from time to time by any Tranche A Lender or any of its Affiliates to any Obligor or any Subsidiary in connection with operating, collections, payroll, trust, or other depository or disbursement accounts, including automatic clearinghouse, controlled disbursement, depository, electronic funds transfer, information reporting, lockbox, stop payment, overdraft and/or wire transfer services.
Cash Management Order” - the order of the Bankruptcy Court entered in the Chapter 11 Cases after the “first day” hearing, together with all extensions, modifications and amendments thereto or any “second day” order, in form and substance satisfactory to the Agent, which among other matters authorizes the Debtors to maintain their existing cash management and treasury arrangements (as set forth in the Pre-Petition Loan Agreement) or such other arrangements as shall be acceptable to the Agent in all material respects.
CERCLA” - the Comprehensive Environmental Response Compensation and Liability Act (42 U.S.C. § 9601 et seq.).
Change of Control” - means the occurrence of any of the following: (a) the Parent (by way of a report or any other filing pursuant to Section 13(d) of the Securities Exchange Act of 1934, proxy, vote, written notice or otherwise) becomes aware of the acquisition by any “person” or “group” (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act of 1934, or any successor provision), including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Securities Exchange Act of 1934, or any successor provision), other than the Permitted Holders, in a single transaction or in a series of related transactions, by way of merger, consolidation or other business combination or purchase of beneficial ownership (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, or any successor provision) of 50% or more of the total voting power of the Voting Stock of the Parent; (b) the first day on which a majority of the members of the Board of Directors of the Parent are not Continuing Directors; (c) the Parent consolidates with, or merges with or into, any Person, or any Person consolidates with, or merges with or into, the Parent, in any such event pursuant to a transaction in which any of the outstanding Voting Stock of the Parent or such other Person is converted into or exchanged for cash, securities or other property, other than any such transaction where (A) the Voting Stock of the Parent outstanding immediately prior to such transaction is converted into or exchanged for Voting Stock of the surviving or transferee Person constituting a majority of the voting power of the outstanding shares of such Voting Stock of such surviving or transferee Person (immediately after giving effect to such issuance) and (B) immediately after such transaction, no “person” or “group” (as such terms are used in Section 13(d) and 14(d) of the Securities Exchange Act of 1934) other than a Permitted Holder becomes, directly or indirectly, the beneficial owner (within the meaning of Rule 13d-3 under the Securities Exchange Act of 1934, or any successor provision) of 50% or more of the voting power of the Voting Stock of the surviving or transferee Person or (d) the failure of (x) Bon-Ton to be a wholly-owned direct Subsidiary of the Parent or (y) any Borrower (other than Bon-Ton) to be a wholly-owned indirect Subsidiary of the Parent.
Chapter 11 Cases”- as defined in the Recitals.
Chattel Paper” - as defined in the UCC.
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Check Processor” - any Person, reasonably acceptable to the Agent, that acts as a processor that converts checks accepted by a Borrower into electronic receipts directed to a designated account of such Borrower.
Check Receivables” - collectively, all present and future rights of a Borrower to payment from any Check Processor arising from sales of goods or rendition of services to customers who have purchased such goods or services using a check.
Claims” - as defined in Section 14.2.
Closing Date” - February 7, 2018.
 “Co-Collateral Agents” - as defined in the Preamble.
Co-Collateral Agent Rights Agreement” - a letter agreement by and among Agent, the Co-Collateral Agents and the Obligors setting for the rights of the Co-Collateral Agents concerning certain matters, substantially in the form of Exhibit G hereto.
Collateral” - (a) any and all “Collateral”, “Pledged Collateral” or words of similar intent as defined in any applicable Security Document, (b) the “DIP Collateral” referred to in the Order, it being understood that “Collateral” shall include all such “DIP Collateral” irrespective of whether any such property was excluded pursuant to the Pre-Petition Loan Documents and (c) all other Property that now or hereafter secures (or is intended to secure) any Obligations.
Commercial Tort Claim” - as defined in the UCC.
Commitment” - for any Lender, the aggregate amount of such Lender’s Tranche A Revolver Commitment and Tranche A-1 Revolver Commitment.  “Commitments” shall have a correlative meaning.
Commitment Termination Date” - the earliest to occur of (a) the Termination Date; (b) the date on which Borrowers terminate the Tranche A Revolver Commitments pursuant to Section 2.2 and repay, in full, in cash all Obligations (including, for the avoidance of doubt, all Tranche A-1 Revolver Loans) other than contingent indemnification obligations with respect to which no claim has been asserted in writing; or (c) the date on which the Commitments are terminated (or deemed terminated) and the Obligations are accelerated (or deemed accelerated) pursuant to Section 11.2.
Committee” - an official committee of unsecured creditors appointed in any of the Chapter 11 Cases by the U.S. Trustee.
Commodity Exchange Act” - means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.
Compliance Certificate” - a certificate, substantially in the form of Exhibit D hereto, by which Borrowers certify, among other things, compliance with the covenants contained in 10.1.17(b) and Sections 10.3.
Connection Income Taxes” - Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.
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Contingent Obligation” - any obligation of a Person arising from a guaranty, indemnity or other assurance of payment or performance of any Debt, lease, dividend or other obligation (“primary obligations”) of another obligor (“primary obligor”) in any manner, whether directly or indirectly, including any obligation of such Person under any (a) guaranty, endorsement, co-making or sale with recourse of an obligation of a primary obligor; (b) obligation to make take-or-pay or similar payments regardless of nonperformance by any other party to an agreement; and (c) arrangement (i) to purchase any primary obligation or security therefor, (ii) to supply funds for the purchase or payment of any primary obligation, (iii) to maintain or assure working capital, equity capital, net worth or solvency of the primary obligor, (iv) to purchase Property or services for the purpose of assuring the ability of the primary obligor to perform a primary obligation, or (v) otherwise to assure or hold harmless the holder of any primary obligation against loss in respect thereof; provided that “Contingent Obligation” shall not include any product warranties given in the Ordinary Course of Business.  The amount of any Contingent Obligation shall be deemed to be the stated or determinable amount of the primary obligation (or, if less, the maximum amount for which such Person may be liable under the instrument evidencing the Contingent Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability with respect thereto.
Continuing Directors” - as of any date of determination, those members of the Board of Directors of the Parent, each of whom: (1) was a member of such Board of Directors on the Closing Date; or (2) was nominated for election or elected to such Board of Directors with the approval of a majority of the then Continuing Directors who were members of such Board of Directors at the time of such nomination or election.
Copyright Security Agreements” - each memorandum of grant of security interest in copyrights or other copyright security agreement pursuant to which an Obligor grants to the Agent, for the benefit of Secured Parties, a Lien on such Obligor’s interests in copyrights, as security for the Obligations.
Credit Card Issuer” - collectively (x) MasterCard International, Inc., Visa, U.S.A., Inc., Visa International and American Express, World Financial Network National Bank and Discover and (y) HSBC, as issuer of the Borrowers’ private label credit card program, and any replacement thereof that is reasonably acceptable to Agent.
Credit Card Notification” - a notification instructing a Credit Card Processor to transfer all amounts owing by such Credit Card Processor to an Obligor directly to the Borrower Account or other Deposit Account reasonably acceptable to the Agent and subject to control arrangements reasonably satisfactory to the Agent, which notification shall be substantially the form attached hereto as Exhibit E, or in such other form reasonably acceptable to the Agent.
Credit Card Processor” - any Person that acts as a credit card clearinghouse or processor with respect to any sales transactions involving credit card purchases by customers using credit cards issued by any Credit Card Issuer.
Credit Card Receivables” - collectively, all present and future rights of the Obligors to payment from (a) any Credit Card Issuer or Credit Card Processor arising from sales of goods or rendition of services to customers who have purchased such goods or services using a credit or debit card and (b) any Credit Card Issuer or Credit Card Processor in connection with the sale or transfer of Accounts arising pursuant to the sale of goods or rendition of services to customers who have purchased such goods or services using a credit card or a debit card, including, but not limited to, all amounts at any time due or to become due from any Credit Card Issuer or Credit Card Processor under the Credit Card Notifications or otherwise.
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Credit Card Receivables Reserve” - reserves, established by the Agent in its reasonable exercise of its credit judgment, to reflect factors that may negatively impact the value of Credit Card Receivables (including, without limitation, for chargeback or other accrued liabilities or offsets by Credit Card Processors and amounts to adjust for material claims, offsets, defenses or counterclaims or other material disputes with an Account Debtor).
Cumulative Four-Week Period” - the four-week period up to and through the Saturday of the most recent week then ended, or if a four-week period has not then elapsed from the Petition Date, such shorter period since the Petition Date through the Saturday of the most recent week then ended.
Cumulative Period” - the period from the Petition Date through the Saturday of the most recent week ended.
CWA” - the Clean Water Act (33 U.S.C. §§ 1251 et seq.).
Debt” - as applied to any Person, without duplication, whether or not included as indebtedness or liabilities in accordance with GAAP (a) all obligations of such Person for borrowed money and all obligations of such Person evidenced by bonds, debentures, notes, loan agreements or other similar instruments; (b) all direct or contingent obligations of such Person arising under letters of credit (including standby and commercial), bankers’ acceptances, bank guaranties, surety bonds and similar instruments; (c) net obligations of such Person under any Hedging Agreement; (d) all obligations of such Person to pay the deferred purchase price of property or services (other than trade accounts payable in the ordinary course of business); (e) indebtedness (excluding prepaid interest thereon) secured by a Lien on property owned or being purchased by such Person (including indebtedness arising under conditional sales or other title retention agreements), whether or not such indebtedness shall have been assumed by such Person or is limited in recourse; (f) Capital Leases and synthetic lease obligations; (g) all obligations of such Person in respect of Disqualified Stock; and (h) all Guarantees of such Person in respect of any of the foregoing.  For all purposes hereof, the Debt of any Person shall include the Debt of any partnership or joint venture (other than a joint venture that is itself a corporation or limited liability company) in which such Person is a general partner or a joint venturer, unless such Debt is expressly made non-recourse to such Person.
Debtors” - as defined in the Recitals.
Default” - an event or condition that, with the lapse of time or giving of notice, would constitute an Event of Default.
Default Rate” - for any Obligation (including, to the extent permitted by law, interest not paid when due), 2% plus the interest rate otherwise applicable thereto.
Defaulting Lender” - subject to Section 4.2.2, any Lender that (a) has failed to (i) fund all or any portion of its funding obligations hereunder, including in respect of its Loans or participations in respect of Letters of Credit or Swingline Loans, within one Business Day of the date such obligations were required to be funded hereunder unless such Lender notifies the Agent and Borrower Agent in writing that such failure is the result of such Lender’s determination that one or more conditions precedent to funding (each of which conditions precedent, together with any applicable default, shall be specifically identified in such writing) has not been satisfied, or (ii) pay to the Agent, including in its capacity as provider of Swingline Loans, any Issuing Bank or any other Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swingline Loans) within one Business Day of the date
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when due, (b) has notified Borrower Agent, the Agent or any Issuing Bank in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect (unless such writing or public statement relates to such Lender’s obligation to fund a Loan hereunder and states that such position is based on such Lender’s determination that a condition precedent to funding (which condition precedent, together with any applicable default, shall be specifically identified in such writing or public statement) cannot be satisfied), (c) has failed, within three Business Days after written request by the Agent or the Borrower Agent, to confirm in writing to the Agent and the Borrower Agent that it will comply with its prospective funding obligations hereunder (provided that such Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Agent and the Borrower Agent), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of an Insolvency Proceeding, or (ii) had appointed for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state, federal or foreign regulatory authority acting in such a capacity; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender.  Any determination by the Agent that a Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above, and of the effective date of such status, shall be conclusive and binding absent manifest error, and such Lender shall be deemed to be a Defaulting Lender (subject to Section 4.2.2)) as of the date established therefor by the Agent in a written notice of such determination, which shall be delivered by the Agent to the Borrower Agent, each Issuing Bank and each other Lender promptly following such determination.
Deposit Account” - as defined in the UCC.
Designated Jurisdiction” - any country or territory to the extent that such country or territory itself is the subject of any Sanction.
DIP Indemnity Account” - an account that shall hold an amount equal to $500,000 for the purpose of securing contingent indemnification obligations and other contingent claims arising under this Loan Agreement, the other Loan Documents or otherwise in respect of the Obligations in the event the Agent and the Lenders have not received releases and discharges of claims and liabilities, in form and substance reasonably satisfactory to the Agent and the Lenders, at the time of payment in full in cash of all Obligations other than contingent obligations relating thereto.
Disqualified Stock - any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for which it is exchangeable, in each case at the option of the holder thereof), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or redeemable at the option of the holder thereof, in whole or in part, on or prior to the date that is six months after the Termination Date.  Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require the Parent to repurchase such Capital Stock upon the occurrence of a change of control or an asset sale shall not constitute Disqualified Stock if the terms of such Capital Stock provide that the Parent may not repurchase
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or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with Section 10.2.4.  The term “Disqualified Stock” shall also include any options, warrants or other rights that are convertible into Disqualified Stock or that are redeemable at the option of the holder, or required to be redeemed, prior to the date that is six months after the Termination Date.
Distribution” - any declaration or payment of a distribution, interest or dividend on any Capital Stock (other than payment-in-kind); any distribution, advance or repayment of Debt to a holder of Capital Stock; or any purchase, redemption, or other acquisition or retirement for value of any Capital Stock.
Distribution Center - the warehouse and distribution facilities operated by the Obligors and located at 3585 S. Church Street, Whitehall, Pennsylvania, 1340 East Dayton-Yellow Springs Road, Fairborn, Ohio, 4650 Shepard Trial, Rockford, Illinois and 1835 Jefferson Avenue, Naperville, Illinois, and any other warehouse and distribution facilities operated by the Borrowers.
Document” - as defined in the UCC.
Dollars” - lawful money of the United States.
Dominion Account” - each special account established by Borrowers at Bank of America or another bank reasonably acceptable to the Agent, over which the Agent has exclusive control for withdrawal purposes.
EEA Financial Institution” - means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.
EEA Member Country” - means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.
EEA Resolution Authority” - means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.
Eligible Assignee” - means (a) with respect to any Tranche A Revolver Loans, a Person that is (i) a Lender, U.S.-based Affiliate of a Lender or Approved Fund; provided that no Tranche A-1 Lender, Affiliate of a Tranche A-1 Lender or Approved Fund of a Tranche A-1 Lender may be an Eligible Assignee pursuant to this clause (i) without the written approval of Agent; (ii) any other financial institution approved by Agent (such approval not to be unreasonably withheld or delayed) that is organized under the laws of the United States or any state or district thereof, has total assets in excess of $1,000,000,000, extends asset-based lending facilities in its ordinary course of business and whose becoming an assignee would not result in a breach of Section 13.5; provided that the foregoing criteria in this clause (ii) may be waived pursuant to the written approval of the Agent; and (iii) during any Event of Default, any Person acceptable to Agent in its discretion, and (b) with respect to any Tranche A-1 Revolver Loans, a Person that is (i) a Lender, an Affiliate of a Lender or an Approved Fund, (ii) any other financial institution approved by Agent (such approval not to be unreasonably withheld or delayed), and whose becoming an
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assignee would not result in a breach of Section 13.5, (iii) any other entity (other than a natural Person) that is an “accredited investor” (as defined in Regulation D under the Securities Act) that extends credit or buys loans as one of its businesses, including insurance companies, investment or mutual funds, or lease financing companies, and (iv) during any Event of Default, any Person acceptable to Agent in its discretion; provided that, in any event, “Eligible Assignee” shall not include (w) any Obligor or any Affiliate or Subsidiary of any Obligor, (x) any Defaulting Lender or any of its Subsidiaries, or any Person who, upon becoming a Lender hereunder, would constitute any of the foregoing Persons described in this clause (x), (y) any natural Person (or a holding company, investment vehicle or trust for, or owned and operated for the primary benefit of a natural Person) or (z) any holder of the Senior Note Debt.
Eligible Check Receivables - at the time of any determination thereof, each Check Receivable that satisfies the following criteria at the time of creation and continues to meet the same at the time of such determination: such Check Receivable has been earned by performance and represents the bona fide amounts due to a Borrower from a Check Processor, and originated in the ordinary course of business of such Borrower.  Without limiting the foregoing, to qualify as an Eligible Check Receivable, the related Account or Payment Intangible shall indicate no Person other than a Borrower as payee or remittance party.  In determining the amount to be so included, the face amount of the related Account or Payment Intangible shall be reduced by, without duplication, to the extent not reflected in such face amount, (i) the amount of all accrued and actual discounts, claims, credits or credits pending, promotional program allowances, price adjustments, finance charges or other allowances (including any amount that a Borrower may be obligated to rebate to a customer or a Check Processor pursuant to the terms of any agreement or understanding (written or oral)) and (ii) the aggregate amount of all cash received in respect of such Account or Payment Intangible but not yet applied by the Obligors to reduce the amount of such Check Receivable.  Any Check Receivables meeting the foregoing criteria shall be deemed Eligible Check Receivables but only as long as such Check Receivable is not included within any of the following categories, in which case such Check Receivable shall not constitute an Eligible Check Receivable:
(a)               Check Receivables which do not constitute an “Account” or “Payment Intangible” (each, as defined in the UCC);
(b)               Check Receivables due from Check Processors that have been outstanding for more than five (5) Business Days from the date of acceptance of the underlying checks at the point of sale;
(c)               Check Receivables that are not denominated in U.S. dollars;
(d)               Check Receivables with respect to which the Borrowers do not have good, valid and marketable title thereto;
(e)               Check Receivables due from Check Processors that (i) are not subject to a First Priority Lien or (ii) are subject to any Liens except for (x) Liens in favor of the Agent and (y) Permitted Liens described in Sections 10.2.2(c) through 10.2.2(x), so long as such Liens (other than Permitted Liens entitled to priority under Applicable Law) are junior to the Liens granted to the Agent;
(f)               Check Receivables due from Check Processors which are disputed between a Borrower and a Check Processor, or with respect to which a claim, counterclaim, offset or chargeback has been asserted, by the related Check Processor (but only to the extent of such dispute, claim, counterclaim, offset or chargeback);
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(g)               Check Receivables due from Check Processors as to which the Check Processor has the right under certain circumstances to require the Borrowers to repurchase such Accounts from such Check Processor;
(h)               Except as otherwise approved by the Agent, Check Receivables due from Check Processors as to which the Agent has not received a notification (giving effect to any continued effective notification delivered under the Pre-Petition Loan Agreement) and which shall be in form and substance reasonably satisfactory to the Agent and provide, among other things, that the Check Processor agrees to make payment therefor into a designated account);
(i)               Check Receivables due from a Check Processor of the applicable check which is the subject of any proceeding under any debtor relief law;
(j)               Check Receivables which are not a valid, legally enforceable obligation of the applicable Check Processor with respect thereto;
(k)               Check Receivables which are evidenced by “chattel paper” or an “instrument” of any kind (which for the avoidance of doubt shall not include the underlying checks themselves) unless such “chattel paper” or “instrument” is in the possession of the Agent, and to the extent necessary or appropriate as reasonably determined by the Agent, endorsed to the Agent; or
(l)               Check Receivables due from Check Processors which the Agent determines, in its reasonable credit judgment, to be unlikely to be collected.
Notwithstanding the above, the Agent reserves the right, at any time and from time to time after the Closing Date, to adjust the criteria set forth above, to establish new criteria and to adjust the applicable advance rate with respect to Eligible Check Receivables, in its reasonable credit judgment, subject to the approval of the Supermajority Lenders in the case of adjustments of criteria or establishment of new criteria which have the effect of making more credit available or subject to the approval of all Lenders (except Defaulting Lenders as provided in Section 4.2) in the case of changes in the applicable advance rates which have the effect of making more credit available.
Eligible Credit Card Accounts” - at the time of any determination thereof, each Credit Card Receivable that satisfies the following criteria at the time of creation and continues to meet the same at the time of such determination: such Credit Card Receivable has been earned by performance and represents the bona fide amounts due to a Borrower from a Credit Card Processor and/or Credit Card Issuer, and in each case originated in the ordinary course of business of such Borrower.  Without limiting the foregoing, to qualify as an Eligible Credit Card Account, such Credit Card Receivable shall indicate no Person other than a Borrower as payee or remittance party.  In determining the amount to be so included, the face amount of the Credit Card Receivable shall be reduced by, without duplication, to the extent not reflected in such face amount, (i) the amount of all accrued and actual discounts, claims, credits or credits pending, promotional program allowances, price adjustments, finance charges or other allowances (including any amount that a Borrower may be obligated to rebate to a customer, a Credit Card Processor or Credit Card Issuer pursuant to the terms of any agreement or understanding (written or oral)) and (ii) the aggregate amount of all cash received in respect of such Credit Card Receivable but not yet applied by the Obligors to reduce the amount of such Credit Card Receivable.  Any Credit Card Receivables meeting the foregoing criteria shall be deemed Eligible Credit Card Accounts but only as long as such Credit Card Receivable is not included within any of the following categories, in which case such Credit Card Receivable shall not constitute an Eligible Credit Card Account:
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(a)               Credit Card Receivables which do not constitute an “Account” or “Payment Intangible” (as each such term is defined in the UCC);
(b)               Credit Card Receivables due from Credit Card Processors that have been outstanding for more than five (5) Business Days from the date of sale;
(c)               Credit Card Receivables that are not denominated in U.S. dollars;
(d)               Credit Card Receivables with respect to which the Borrowers do not have good, valid and marketable title thereto;
(e)               Credit Card Receivables due from Credit Card Processors or Credit Card Issuers that (i) are not subject to a First Priority Lien or (ii) are subject to any Liens except for (x) Liens in favor of the Agent and (y) Permitted Liens described in Sections 10.2.2(c) through 10.2.2(x), so long as such Liens (other than Permitted Liens entitled to priority under Applicable Law) are junior to the Liens granted to the Agent;
(f)               Credit Card Receivables due from Credit Card Processors or Credit Card Issuers which are disputed between a Borrower and a Credit Card Processor or Credit Card Issuers, or with respect to which a claim, counterclaim, offset or chargeback has been asserted, by the related Credit Card Processor or Credit Card Issuers (but only to the extent of such dispute, claim, counterclaim, offset or chargeback);
(g)               Credit Card Receivables due from Credit Card Processors or Credit Card Issuers as to which the Credit Card Processor or the Credit Card Issuers has the right under certain circumstances to require the Borrowers to repurchase such Accounts from such Credit Card Processor or such Credit Card Issuers;
(h)               Except as otherwise approved by the Agent, Credit Card Receivables due from Credit Card Processors or Credit Card Issuers as to which the Agent has not received a Credit Card Notification (giving effect to any continued effective notification delivered under the Pre-Petition Loan Agreement);
(i)               Credit Card Receivables due from a Credit Card Processor or Credit Card Issuer of the applicable credit card which is the subject of any proceeding under any debtor relief law;
(j)               Credit Card Receivables which are not a valid, legally enforceable obligation of the applicable Credit Card Processor or Credit Card Issuer with respect thereto;
(k)               Credit Card Receivables which are evidenced by “chattel paper” or an “instrument” of any kind unless such “chattel paper” or “instrument” is in the possession of Agent, and to the extent necessary or appropriate as reasonably determined by the Agent, endorsed to Agent; or
(l)               Credit Card Receivables due from Credit Card Issuers or Credit Card Processors which Agent determines, in its reasonable credit judgment, to be unlikely to be collected.
Notwithstanding the above, the Agent reserves the right, at any time and from time to time after the Closing Date, to adjust the criteria set forth above, to establish new criteria and to adjust the applicable advance rate with respect to Eligible Credit Card Accounts, in its reasonable credit judgment, subject to the approval of the Supermajority Lenders in the case of adjustments of criteria or establishment of new criteria which have the effect of making more credit available
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or subject to the approval of all Lenders (except Defaulting Lenders as provided in Section 4.2) in the case of changes in the applicable advance rates which have the effect of making more credit available.
Eligible Inventory” - Inventory owned by a Borrower that the Agent, in its reasonable credit judgment, deems, based on (i) the most recent Borrowing Base Certificate delivered to the Agent, (ii) the salability, at retail, of such Inventory (valued at the lower of cost or market), (iii) such other factors as affect the marketability of such Inventory and (iv) other information available to the Agent, in its reasonable credit judgment, to be “Eligible Inventory” for purposes of this Loan Agreement.  Without limiting the foregoing, no Inventory shall be Eligible Inventory unless (a) it is finished goods and not work-in-process, raw materials, packaging or shipping materials, labels, samples, display items, bags, replacement parts or manufacturing supplies; (b) it is not held on consignment; (c) it is in new and saleable condition and is not damaged, defective, shopworn or otherwise unfit for sale; (d) it is not slow-moving, obsolete or unmerchantable, and does not constitute returned to vendor or repossessed goods; (e) to the knowledge of the Obligors it meets all standards imposed by any Governmental Authority, and does not constitute hazardous materials under any Environmental Law; (f) [reserved]; (g) it is (unless such Inventory constitutes Eligible L/C Inventory) subject to a First Priority Lien, and is free and clear from all Liens or rights of any person (including, without limitation, the rights of any purchaser that has made progress payments and the rights of any surety that has issued a bond to assure such Borrower’s performance with respect to the Inventory) except for (x) Liens in favor of the Agent and (y) Permitted Liens described in Sections 10.2.2(c) through 10.2.2(x), so long as such Liens (other than Permitted Liens permitted pursuant to clauses (c), (d), (f), (o), (t), (u) or (w) of such definition and entitled to priority under Applicable Law) are junior to the Liens granted to the Agent; (h) it is within the continental United States, is not in transit except between locations of Borrowers where such locations are in compliance with the provisions of clause (k) below (unless such Inventory constitutes Eligible In-Transit Inventory or Eligible L/C Inventory) and is not consigned to any Person; (i) it is not subject to any warehouse receipt or negotiable Document unless such document has been delivered to the Agent or other Persons acceptable to it with all necessary endorsements free and clear of all Liens except for (x) Liens in favor of the Agent and (y) Permitted Liens described in Sections 10.2.2(c) through 10.2.2(x), so long as such Liens (other than Permitted Liens permitted pursuant to clauses (c), (d), (f), (o), (t), (u) or (w) of such definition and entitled to priority under Applicable Law) are junior to the Liens granted to the Agent; (j) it is not subject to any License or other arrangement that restricts such Borrower’s or the Agent’s right to dispose of such Inventory, unless Agent has received an appropriate Lien Waiver; (k) it is not located on leased premises (1) consisting of a Large Inventory Location or (2) located in a Landlord Lien State, or in the possession of a warehouseman, processor, repairman, mechanic, shipper, freight forwarder or other Person unless, in each case, the lessor or such Person has delivered a Lien Waiver or an appropriate Rent and Charges Reserve has been established; (l) it is reflected in the details of the current inventory stock ledger of the applicable Borrower; (m) it is of a type held for sale in the ordinary course of such Borrower’s business; (n) the representations or warranties pertaining to Inventory set forth in this Loan Agreement and the other Loan Documents are true in all material respects as to such Inventory; (o) it does not consist of any costs associated with advertising load or unearned discounts; and (p) it is covered by casualty insurance reasonably acceptable to the Agent.
Eligible In-Transit Inventory” - means without duplication of other Eligible Inventory, all finished goods Inventory (valued at the lower of cost or market) owned by Borrowers, not covered by Letters of Credit, which Inventory (a) is located in the continental United States and in transit to one of the Borrower’s facilities and which Inventory (i) is owned by a Borrower and either (A) has been paid for with a draw of an Eligible Trade L/C by a Borrower or (B) payment
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for which is not yet due and has not yet been paid for by a Borrower but which is located at one of the Borrower’s distribution facilities and has not yet been recorded on a Borrower’s inventory stock ledger in the ordinary course; (ii) is fully insured; (iii) is subject to a First Priority Lien; (iv) is evidenced or deliverable pursuant to Documents that have been delivered to the Agent or an agent acting on its behalf pursuant to a Lien Waiver or designating the Agent as consignee; and (v) is otherwise “Eligible Inventory” hereunder; or (b) is in transit for not more than forty (40) days directly from a point of shipment outside of the continental United States to one of the Obligors’ owned or leased locations within the continental United States, provided that, with respect to this clause (b), (i) a Borrower has title to such Inventory, and either (X) such Inventory is not subject to a negotiable bill of lading or other document of title and the shipping documents relating to such Inventory (including, without limitation, so-called “forwarders cargo receipts” or “non-negotiable express bills of lading”) reasonably acceptable to the Agent have been delivered to the Agent or an agent acting on behalf of the Agent and such shipping documents name a Borrower as consignee and shipper (or such other arrangements reasonably satisfactory to the Agent relating to such shipping documents in respect of such Inventory shall have been made) or (Y) in the event such Inventory is subject to negotiable bills of lading or other documents of title, such negotiable bills of lading or other documents of title have been (1) upon the request of the Agent, issued with the Agent as consignee and a Borrower as shipper and (2) delivered to the Agent or an agent acting on behalf of the Agent (or such other arrangements reasonably satisfactory to the Agent relating to such negotiable bills of lading or other documents of title in respect of such Inventory shall have been made), (iii) such Inventory is subject, to the reasonable satisfaction of the Agent, to a First Priority Lien, (iv) at the request of the Agent, the vendor or the supplier of such Inventory has agreed to waive its claims in or to such Inventory (including any right to stop such Inventory in transit), in a manner reasonably acceptable to the Agent, once such Inventory is delivered to a freight forwarder or other representative of the Borrowers who has entered into an agreement of the type described in clause (vi) below, (v) such Inventory is covered by insurance reasonably acceptable to the Agent, (vi) at the request of the Agent, each relevant freight carrier, freight forwarder, customs broker and shipping company in possession of such in-transit Inventory shall have (A) entered into bailee arrangements reasonably satisfactory to the Agent and (B) indicated or otherwise acknowledged the Agent’s security interest in such Inventory and in any shipping documents issued or carried by such freight carrier or shipping company (including, without limitation, waybills, airway bills, seaway bills, receipts, or any similar document), in each case, in a manner reasonably satisfactory to the Agent, and (vii) such Inventory would otherwise satisfy all of the requirements of “Eligible Inventory” hereunder.  Notwithstanding the foregoing, in no event shall the Aggregate Borrowing Base comprised of Eligible In-Transit Inventory under clause (b) above exceed $15,000,000.  The Agent shall have the right (without limiting any of it other rights as provided herein) to exclude Eligible In-Transit Inventory described in clause (b) above (in whole or in part) from the determination of the Tranche A Borrowing Base and/or the Tranche A-1 Borrowing Base in the event that the Agent determines in its reasonable credit judgment that the Borrowers have commenced, or have determined to commence, a full-chain liquidation, including a Specified Full-Chain Liquidation.
Eligible L/C Inventory” - as of any date of determination, without duplication of other Eligible Inventory, all finished goods Inventory (valued at the lower of cost or market) covered by an Eligible Trade L/C issued for the account of a Borrower, which inventory (a) meets all of the requirements for Eligible Inventory, (b) will be Eligible In-Transit Inventory upon a draw of the subject Eligible Trade L/C, and (c) will be received by a Borrower in the United States not later than ninety (90) days from the date of determination (as determined by the Borrowers consistent with their past practices).  The Agent shall have the right (without limiting any of it other rights as provided herein) to exclude Eligible L/C Inventory of the type described in the clause (b) of the definition of Eligible In-Transit Inventory (in whole or in part) from the
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determination of the Tranche A Borrowing Base and/or the Tranche A-1 Borrowing Base in the event that the Agent determines in its reasonable credit judgment that the Borrowers have commenced, or have determined to commence, a full-chain liquidation, including a Specified Full-Chain Liquidation.
Eligible Real Estate” - Real Estate owned by a Borrower described on Schedule 7.3 (as may be updated pursuant to, and in accordance with, Section 7.3) and which Agent, in its reasonable discretion, deems to be Eligible Real Estate.  Without limiting the generality of the foregoing, no Real Estate shall be Eligible Real Estate unless: (a) it is located in the United States; (b) it is subject to Agent’s duly perfected, first priority Lien, and no other Lien except Permitted Liens; (c) it is subject to a title insurance policy reasonably acceptable to Agent and Agent has received title searches, reasonably acceptable to it, with respect to such Real Estate (including pursuant to any Pre-Petition Loan Document); (d) it has been appraised by a third party appraiser reasonably acceptable to Required Lenders; (e) the Agent has received an environmental site assessment of such Real Estate reasonably acceptable to the Agent, which such environmental site assessment shall include Phase I reports and, if requested by the Agent, Phase II reports; (f) if requested by the Agent, the Agent has received estoppel agreements reasonably acceptable to the Agent, from ground lessors; (g) the Agent has received all other Related Real Estate Documents requested by it with respect to such Real Estate and such Related Real Estate Documents are reasonably satisfactory to the Agent; (h) such Real Estate is improved by fully constructed buildings occupied by a Borrower or a Guarantor.  In addition, with respect to any Store location that is subject to the Specified Store Closing Sales or is otherwise subject to a Liquidation, the Agent may, in its reasonable discretion, exclude such Real Estate from Eligible Real Estate or implement an Availability Reserve with respect to all or any portion of the value thereof.
Eligible Trade L/C” - any Letter of Credit issued in compliance with Section 2.3.1(e) for payment of the purchase price of finished goods Inventory which will be Eligible In-Transit Inventory upon presentation of a draft under such Letter of Credit.
Enforcement Action” - any rightful action to enforce any Obligations or Loan Documents or to realize upon any Collateral (whether by judicial action, self-help, notification of Account Debtors, exercise of setoff or recoupment, or otherwise).
Environmental Agreement” - each agreement of Obligors with respect to any Real Estate subject to a Mortgage or a Pre-Petition Mortgage, pursuant to which Obligors agree to indemnify and hold harmless the Agent and Lenders from liability under any Environmental Laws, except for liability caused by any actions of the Agent or the Lenders which are in violation of the Environmental Laws.
Environmental Laws” - all requirements of Applicable Law and Permits imposing liability or standards of conduct for or relating to the regulation and protection of human health (as it relates to exposure to Hazardous Materials), employee safety, the environment and natural resources, including CERCLA, the SDWA, the Hazardous Materials Transportation Act (49 U.S.C. §§ 5101 et seq.), the Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. §§ 136 et seq.), the Toxic Substances Control Act (15 U.S.C. §§ 2601 et seq.), the Clean Air Act (42 U.S.C. §§ 7401 et seq.), the Federal Water Pollution Control Act (33 U.S.C. §§ 1251 et seq.), the Occupational Safety and Health Act (29 U.S.C. §§ 651 et seq.), the Safe Drinking Water Act (42 U.S.C. §§ 300(f) et seq.), all regulations promulgated under any of the foregoing, all analogous requirements of Applicable Law and Permits and any environmental transfer of ownership notification or approval statutes.
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Environmental Liabilities” - all Liabilities (including costs of remedial actions, natural resources damages and costs and expenses of investigation and feasibility studies) that may be imposed on, incurred by or asserted against any Obligors as a result of, or related to, any claim, suit, action, investigation, proceeding or demand by any Person, whether based in contract, tort, implied or express warranty, strict liability, criminal or civil statute or common law or otherwise, arising under any Environmental Law or in connection with any environmental condition or with any Environmental Release and resulting from the ownership, lease, sublease or other operation or occupation of property by any Obligors, whether on, prior or after the date hereof.
Environmental Notice” - a notice (whether written or oral) from any Governmental Authority or other Person of any possible noncompliance with, investigation of a possible violation of, litigation relating to, or potential fine or liability under any Environmental Law, or with respect to any Environmental Release, environmental pollution or hazardous materials, including any complaint, summons, citation, order, claim, demand or request for correction, remediation or otherwise.
Environmental Release” - a release of Hazardous Material as defined in CERCLA, RCRA, or under any other Environmental Law.
Equipment” - as defined in the UCC, including all machinery, apparatus, equipment, fittings, furniture, fixtures, motor vehicles and other tangible personal Property (other than Inventory), and all parts, accessories and special tools therefor, and accessions thereto and, in any event, including all such Person’s machinery and equipment, including processing equipment, conveyors, machine tools, data processing and computer equipment including embedded software and peripheral equipment and all engineering, processing and manufacturing equipment, office machinery, furniture, materials handling equipment, tools, attachments, accessories, automotive equipment, trailers, trucks, forklifts, molds, dies, stamps, motor vehicles, rolling stock and other equipment of every kind and nature, trade fixtures and fixtures not forming a part of real property, together with all additions and accessions thereto, replacements therefor, all parts therefor, all substitutes for any of the foregoing, fuel therefor, and all manuals, drawings, instructions, warranties and rights with respect thereto, and all products and proceeds thereof and condemnation awards and insurance proceeds with respect thereto.
ERISA” - the Employee Retirement Income Security Act of 1974, as amended, and the rules and regulations promulgated thereunder.
ERISA Affiliate” - means, with respect to any Obligor, any trade or business (whether or not incorporated) that, together with such Obligor, is treated as a single employer within the meaning of Section 414(b) or (c) of the IRC (and Sections 414(m) and (o) of the IRC for purposes of provisions relating to Section 412 of the IRC).
ERISA Event” - means (a) a Reportable Event with respect to a Plan; (b) the withdrawal of any Obligor or Subsidiary or any of their respective ERISA Affiliates from a Plan subject to Section 4063 of ERISA during a plan year in which such entity was a “substantial employer” as defined in Section 4001(a)(2) of ERISA or a cessation of operations that is treated as such a withdrawal under Section 4062(e) of ERISA; (c) the filing of a notice of intent to terminate or the treatment of a Plan amendment as a termination under Section 4041 of ERISA; (d) the institution by the PBGC of proceedings to terminate a Plan; (e) any event or condition which constitutes grounds under Section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Plan; (f) the determination that any Plan is considered an at-risk plan within the meaning of Sections 430, 431 and 432 of the IRC or Sections 303, 304 and 305 of ERISA; (g) the filing of any request for or receipt of a minimum funding waiver under Section 412 of the IRC
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with respect to any Multiemployer Plan, or that such filing may be made; or a determination that any Multiemployer Plan is, or is expected to be, considered a plan in endangered or critical status within the meaning of Sections 431 and 432 of the IRC or Sections 304 and 305 of ERISA; (h) the complete or partial withdrawal of any Obligor or Subsidiary or any of their respective ERISA Affiliates from a Multiemployer Plan, the reorganization or insolvency under Title IV of ERISA of any Multiemployer Plan; or the receipt by any Obligor or Subsidiary or any of their respective ERISA Affiliates, of any notice that a Multiemployer Plan is in endangered or critical status under Section 305 of ERISA; (i) the imposition of any liability under Title IV of ERISA, other than for PBGC premiums due but not delinquent under Section 4007 of ERISA, upon any Obligor or Subsidiary or any of their respective ERISA Affiliates; or (j) the failure by any Obligor or Subsidiary or any of their respective ERISA Affiliates to meet all applicable requirements under the Pension Funding Rules in respect of a Plan, whether or not waived.
EU Bail-In Legislation Schedule” - means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.
Event of Default” - as defined in Section 11.
Excess Availability” - as of any date of determination, the result of (a) the lesser of (i) the aggregate Tranche A Revolver Commitments at such time and (ii) the Tranche A Borrowing Base at such time minus (b) sum of (i) the outstanding principal balance of all Tranche A Revolver Loans on such date, (ii) the outstanding amount of LC Obligations on such date, (iii) the Pre-Petition Tranche A Credit Extensions, if any, outstanding at such time and (iv) the Tranche A-1 Utilization Amount on such date.  For the avoidance of doubt, in no event shall the Pre-Petition Tranche A Prepayment Premium (after giving effect to the waiver thereof with respect to the Tranche A Revolver Reduction Amount) or the Pre-Petition Specified Tranche A-1 Prepayment Premium (after giving effect to the waiver thereof with respect to the Prepaid Pre-Petition Tranche A-1 Revolver Loans) be included in any determination of borrowing availability hereunder, including any determination of Excess Availability.
Excluded Swap Obligation” - means, with respect to any Guarantor, any Swap Obligation if, and to the extent that, all or a portion of the Guaranty of such Guarantor of, or the grant by such Guarantor of a security interest to secure, such Swap Obligation (or any Guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation of any thereof) by virtue of such Guarantor’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to Section 14.20 and any other “keepwell, support or other agreement” for the benefit of such Guarantor and any and all guarantees of such Guarantor’s Swap Obligations by other Obligors) at the time the Guaranty of such Guarantor, or a grant by such Guarantor of a security interest, becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one swap, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to swaps for which such Guaranty or security interest is or becomes excluded in accordance with the first sentence of this definition.
Excluded Taxes” - any of the following Taxes imposed on or with respect to Recipient or required to be withheld or deducted from payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its Lending Office located in, the jurisdiction
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imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by the Borrower Agent under Section 3.6) or (ii) pursuant to Section 5.8.1(b) or Section 5.8.3, amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its Lending Office, (c) Taxes attributable to such Recipient’s failure to comply with Section 5.8.5 and (d) any U.S. federal withholding Taxes imposed pursuant to FATCA.
Existing Letters of Credit” - as defined in Section 2.3.6.
Extraordinary Expenses” - all reasonable and documented out-of-pocket costs, expenses or advances that the Agent or any Co-Collateral Agent may incur during the occurrence and continuance of a Default or Event of Default, or during the pendency of an Insolvency Proceeding of an Obligor, including those relating to (a) any audit, inspection, repossession, storage, repair, appraisal, insurance, manufacture, preparation or advertising for sale, sale, collection, or other preservation of or realization upon any Collateral; (b) any action, arbitration or other proceeding (whether instituted by or against the Agent, any Lender, any Obligor, any representative of creditors of an Obligor or any other Person) in any way relating to any Collateral (including the validity, perfection, priority or avoidability of the Agent’s Liens with respect to any Collateral), Loan Documents or Obligations, including any lender liability or other Claims; (c) the exercise, protection or enforcement of any rights or remedies of Agent in, or the monitoring of, any Insolvency Proceeding; (d) settlement or satisfaction of any taxes, charges or Liens with respect to any Collateral; (e) any Enforcement Action; (f) negotiation and documentation of any modification, waiver, workout, restructuring or forbearance with respect to any Loan Documents or Obligations; or (g) Protective Advances.  Such costs, expenses and advances include transfer fees, taxes, storage fees, insurance costs, permit fees, utility reservation and standby fees, legal fees, financial advisor fees, appraisal fees, brokers’ fees and commissions, auctioneers’ fees and commissions, accountants’ fees, environmental study fees, wages and salaries paid to employees of any Obligor or independent contractors in liquidating any Collateral, and travel expenses.
FATCA” - means Sections 1471 through 1474 of the IRC, as of the date of this Loan Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471 (b)(1) of the IRC and any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such sections of the IRC.
Federal Funds Rate” - for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as reasonably determined by the Agent.
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Fee Letters” - collectively, the Agency and Structuring Fee Letter, the Arrangement Fee Letter, the Tranche A Closing Fee Letter and the Tranche A-1 Closing Fee Letter, each as amended, amended and restated, restated, supplemented or otherwise modified and in effect from time to time.
Final Order” - collectively, the order of the Bankruptcy Court entered in the Chapter 11 Cases after a final hearing under Bankruptcy Rule 4001(c)(2) or such other procedures as approved by the Bankruptcy Court, which order shall be satisfactory in form and substance to the Agent and the Tranche A-1 Documentation Agent, and from which no appeal or motion to reconsider has been timely filed, or if timely filed, such appeal or motion to reconsider has been dismissed or denied with no further appeal and the time for filing such appeal has passed (unless the Agent waives such requirement), together with all extensions, modifications, and amendments thereto, in form and substance satisfactory to the Agent and the Tranche A-1 Documentation Agent, which, among other matters but not by way of limitation, authorizes the Obligors to obtain credit, incur (or guaranty) Indebtedness, and grant Liens under this Loan Agreement and the other Loan Documents, as the case may be, and provides for the super-priority of the Agent’s and the Lenders’ claims.
Financial Advisor” - as defined in Section 10.1.16.
First Priority Lien” - a Lien and security interest (a) created on any Collateral pursuant to the Order or any other Security Document in favor of the Agent for the benefit of the Secured Parties, (b) which is valid, perfected and enforceable and (c) prior in right to any other Lien on such Collateral, other than (i) any Permitted Prior Liens, (ii) any Permitted Liens described in Sections 10.2.2(c), (d), (i), (s), or (u), in each case, that are entitled to priority under Applicable Law, and (iii) Liens which the Agent has determined (in its sole discretion) to be adequately addressed by the Availability Reserves or the eligibility criteria included in the component definitions of the Tranche A Borrowing Base and/or the Tranche A-1 Borrowing Base, as applicable.
Fiscal Quarter” - each successive period of thirteen weeks, commencing on the first day of a Fiscal Year.
Fiscal Year” - the fiscal year of Parent and Subsidiaries, for accounting and tax purposes, which is the 52 or 53 week period ending on the Saturday nearer January 31 of each calendar year (e.g., a reference to fiscal 2018 is a reference to the fiscal year ended February 2, 2019).
Fixtures” - as such term is defined in the UCC, now owned or hereafter acquired by any Obligor, including fixtures located at a parcel of Real Estate subject to a Mortgage or a Pre-Petition Mortgage.
FLSA” - the Fair Labor Standards Act of 1938, as amended.
Flood Insurance Laws” - collectively, (a) National Flood Insurance Reform Act of 1994 (which comprehensively revised the National Flood Insurance Act of 1968 and the Flood Disaster Protection Act of 1973) as now or hereafter in effect or any successor statute thereto, (b) the Flood Insurance Reform Act of 2004 as now or hereafter in effect or any successor statue thereto and (c) the Biggert-Waters Flood Insurance Reform Act of 2012 as now or hereafter in effect or any successor statute thereto and any and all official rulings and interpretation thereunder or thereof.
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Foreign Lender” - (a) if the applicable Borrower is a U.S. Person, a Lender that is not a U.S. Person, and (b) if the applicable Borrower is not a U.S. Person, a Lender that is resident or organized under laws of a jurisdiction other than that in which such Borrower is resident for tax purposes.  For purposes of this definition, the United States, each State thereof and the District of Columbia shall be deemed to constitute a single jurisdiction.
Foreign Plan” - (a) any employee benefit plan or arrangement maintained or contributed to by any Obligor or Subsidiary that is not subject to the laws of the United States, or (b) any employee benefit plan or arrangement mandated by a government other than the United States for employees of any Obligor or Subsidiary, in each case, that is a “defined benefit”-type pension plan under Applicable Law.
Foreign Subsidiary” - a Subsidiary that is a “controlled foreign corporation” under Section 957 of the IRC, such that a guaranty by such Subsidiary of the Obligations or a Lien on the assets of such Subsidiary to secure the Obligations would result in tax liability to the Obligors.
Fronting Exposure” - at any time there is a Defaulting Lender, (a) with respect to the Issuing Bank, such Defaulting Lender’s Pro Rata share of the outstanding LC Obligations other than LC Obligations as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof, and (b) with respect to the Agent in its capacity as a lender of Swingline Loans, such Defaulting Lender’s Pro Rata share of Swingline Loans other than Swingline Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Lenders or Cash Collateralized in accordance with the terms hereof.
Full Payment” - with respect to any Obligations, (a) the full and indefeasible cash payment thereof (other than contingent indemnification Obligations with respect to which no claim has been asserted in writing), including any interest, fees and other charges accruing during an Insolvency Proceeding (whether or not allowed in the proceeding); and (b) if such Obligations are LC Obligations or inchoate or contingent in nature (other than contingent indemnification Obligations with respect to which no claim has been asserted in writing), Cash Collateralization thereof (or delivery of a standby letter of credit acceptable to Agent in its reasonable discretion, in the amount of required Cash Collateral).  No Loans shall be deemed to have been paid in full until all Commitments related to such Loans have expired or been terminated.
Fund” - any Person (other than a natural person) that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its activities.
GAAP” - subject to Section 1.2, generally accepted accounting principles in the United States in effect from time to time.
General Intangibles” - as defined in the UCC, including choses in action, causes of action, company or other business records, inventions, blueprints, designs, patents, patent applications, trademarks, trademark applications, trade names, trade secrets, service marks, goodwill, brand names, copyrights, registrations, licenses, franchises, customer lists, permits, tax refund claims, computer programs, operational manuals, internet addresses and domain names, insurance refunds and premium rebates, all rights to indemnification, contract rights and all other intangible Property of any kind.
Goods” - as defined in the UCC.
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Governmental Approvals” - all authorizations, consents, Permit, approvals, licenses and exemptions of, registrations and filings with, and required reports to, all Governmental Authorities.
Governmental Authority” - any federal, state, municipal, foreign or other governmental department, agency, commission, board, bureau, court, tribunal, instrumentality, political subdivision, or other entity or officer exercising executive, legislative, judicial, regulatory or administrative functions for or pertaining to any government or court, in each case whether associated with the United States, a state, district or territory thereof, or a foreign entity or government.
Guarantor Payment” - as defined in Section 5.10.3.
Guarantors” - each of (a) the Parent, (b) The Bon-Ton Giftco, LLC, (c) Bonstores Holdings One, LLC, (d) Bonstores Holdings Two, LLC, (e) each other Debtor who guarantees payment or performance of any Obligations and (f) with respect to Obligations owing by any Obligor or any Subsidiary of an Obligor (other than the Borrowers) under any Hedging Agreement or Cash Management Services, the Borrowers.
Guaranty” - each guaranty agreement executed by a Guarantor in favor of Agent, substantially in the form of Exhibit F hereto.
Hazardous Material” - any substance, material or waste that is classified, regulated or otherwise characterized under any Environmental Law as hazardous, toxic, a contaminant or a pollutant or by other words of similar meaning or regulatory effect, including petroleum or any fraction thereof, asbestos, polychlorinated biphenyls and radioactive substances.
Hedging Agreement” - an agreement relating to any swap, cap, floor, collar, option, forward, cross right or obligation, or combination thereof or similar transaction, with respect to interest rate, foreign exchange, currency, commodity, credit or equity risk.
Indemnified Taxes- (a) Taxes other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Obligor under any Loan Document and (b) to the extent not otherwise described in clause (a), Other Taxes.
Indemnitees” - Agent Indemnitees, Lender Indemnitees, Issuing Bank Indemnitees, Bank of America Indemnitees and the Tranche A-1 Documentation Agent Indemnitees.
Insolvency Proceeding” - any case or proceeding (other than the Chapter 11 Cases) commenced by or against a Person under any state, federal or foreign law for, or any agreement of such Person to, (a) the entry of an order for relief under the Bankruptcy Code, or any other insolvency, debtor relief or debt adjustment law; (b) the appointment of a receiver, trustee, liquidator, administrator, conservator or other custodian for such Person or any part of its Property; or (c) an assignment or trust mortgage for the benefit of creditors.
Instrument” - as defined in the UCC.
Intellectual Property” - all intellectual and similar Property of a Person, including inventions, designs, patents, patent applications, copyrights, trademarks, service marks, trade names, trade secrets, confidential or proprietary information, customer lists, know-how, software and databases; all embodiments or fixations thereof and all related documentation, registrations
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and franchises; all books and records describing or used in connection with the foregoing; and all licenses or other rights to use any of the foregoing.
Intellectual Property Claim” - any claim or assertion (whether in writing, by suit or otherwise) that the Parent or any Subsidiary’s ownership, use, marketing, sale or distribution of any Inventory, Equipment, Intellectual Property or other Property violates another Person’s Intellectual Property.
Interest Period” - as defined in Section 3.1.3.
Interim Order” - the order of the Bankruptcy Court entered in the Chapter 11 Cases after an interim hearing in form and substance satisfactory to the Agent and the Tranche A-1 Documentation Agent, together with all extensions, modifications, and amendments thereto, in form and substance satisfactory to the Agent and the Tranche A-1 Documentation Agent, which, among other matters but not by way of limitation, authorizes, on an interim basis, the Borrowers and Guarantors to execute and perform under the terms of this Loan Agreement and the other Loan Documents.
Inventory” - as defined in the UCC, including all goods intended for sale, lease, display or demonstration; all work in process; and all raw materials, and other materials and supplies of any kind that are or could be used in connection with the manufacture, printing, packing, shipping, advertising, sale, lease or furnishing of such goods, or otherwise used or consumed in such Person’s business (but excluding Equipment).
Inventory Reserve” - reserves, established by the Agent, based on the most recent appraisal of Borrowers’ Inventory performed by an appraiser and on terms reasonably satisfactory to the Agent and the most recent commercial finance exam of the Borrowers’ books and records performed by an examiner and on terms reasonably satisfactory to the Agent, to reflect factors that may negatively impact the Value of Inventory, including change in salability, obsolescence, seasonality, theft, shrinkage, damage, customer credit liabilities, imbalance, change in composition or mix, markdowns, vendor chargebacks and with respect to Eligible Inventory that has been subject to a Letter of Credit for a period in excess of ninety (90) days.
Investment” - any (a) acquisition of all or substantially all assets of, or any line of business or division of, a Person; (b) acquisition of record or beneficial ownership of any Capital Stock of a Person; (c) any advance or capital contribution to, guarantee or assumption of debt of, or purchase or other acquisition of any other debt or equity participation or interest in, another Person, including any partnership or joint venture interest in such other Person and any arrangement pursuant to which the investor guarantees Debt of such other Person, or (d) other investment in a Person.  For purposes of the Loan Documents, the outstanding amount of any Investment made by any Person at any time shall be calculated as the excess of the initial amount of such Investment made by such Person (including the fair market value of all property transferred by such Person as part of such Investment) over all returns of principal or capital thereof received in cash on or prior to such time by such Person (including all cash dividends, cash distributions and cash repayments of Debt received by such Person).
Investment Property” - as defined in the UCC.
IRC” - means the Internal Revenue Code of 1986, as amended, and any successor thereto.
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ISP” - with respect to any Letter of Credit, the “International Standby Practices 1998” published by the Institute of International Banking Law & Practice, Inc. (or such later version thereof as may be in effect at the time of issuance).
Issuing Bank” - (a) Bank of America or an Affiliate of Bank of America, Wells Fargo Bank, N.A. or an Affiliate of Wells Fargo Bank, N.A. or any other Lender or an Affiliate of such Lender, and any other Person designated by a Lender (and acceptable to the Borrower Agent), in each case, in its capacity as issuer of Letters of Credit hereunder, or any successor issuer of Letters of Credit hereunder and (b) with respect to the Letters of Credit issued by such issuer prior to the Closing Date and described on Schedule 2.3.6, and with respect to any other Letters of Credit issued by such Issuing Bank.  At any time there is more than one Issuing Bank, any singular references to the Issuing Bank shall mean any Issuing Bank, each Issuing Bank, the Issuing Bank that has issued the applicable Letter of Credit, or all Issuing Banks, as the context may require.
Issuing Bank Indemnitees” - each Issuing Bank and its officers, directors, employees, Affiliates, agents, advisors and attorneys.
Joint Lead Arrangers” - as defined in the Preamble.
Landlord Lien State” - (i) the states of Washington, Virginia, Pennsylvania and (ii) such other state(s) or jurisdictions in which a landlord’s claim for rent or other obligations has priority over the Lien of Agent in any of the Collateral.
Large Inventory Location” - any distribution center (including each Distribution Center), warehouse, cross-docking station or storage facility at which Inventory is located.
LC Application” - an application by the Borrower Agent to the Issuing Bank for issuance of a Letter of Credit, in form and substance reasonably satisfactory to the applicable Issuing Bank.
LC Conditions” - the following conditions necessary for issuance of a Letter of Credit: (a) each of the conditions set forth in Section 6; (b) after giving effect to such issuance, total LC Obligations do not exceed the Letter of Credit Subline, no Tranche A Overadvance exists and, if no Tranche A Revolver Loans are outstanding, the LC Obligations do not exceed the result of (i) the Tranche A Borrowing Base minus (ii) the Tranche A-1 Utilization Amount; (c) the expiration date of such Letter of Credit is (i) no more than 365 days from issuance, in the case of standby Letters of Credit, (ii) no more than 180 days from issuance, in the case of documentary Letters of Credit, and (iii) on or prior to the Letter of Credit Expiration Date; (d) the Letter of Credit and payments thereunder are denominated in Dollars; (e) the form of the proposed Letter of Credit is reasonably satisfactory to the Agent and the applicable Issuing Bank in their discretion and (f) the Issuing Bank’s compliance with the requirements of Section 2.3.1(j).
LC Documents” - all documents, instruments and agreements (including LC Requests and LC Applications) delivered by any Borrower or any other Person to Issuing Bank or Agent in connection with issuance, amendment or renewal of, or payment under, any Letter of Credit.
LC Guaranty” - a guaranty issued by an Issuing Bank to another Person in connection  with the issuance by such other Person of Letters of Credit hereunder.
LC Obligations” - the sum (without duplication) of (a) all amounts owing by Borrowers for any drawings under Letters of Credit (including in respect of any payment made by Issuing
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Bank under any LC Guaranty and any deferred payment or acceptance liabilities in respect of such Letter of Credit); (b) the aggregate undrawn amount of all outstanding Letters of Credit; and (c) all fees and other amounts owing with respect to Letters of Credit.
LC Request” - a request for issuance of a Letter of Credit, to be provided by the Borrower Agent to the applicable Issuing Bank, in form reasonably satisfactory to the Agent and such Issuing Bank.
Lease” - any agreement, whether written or oral, no matter how styled or structured, and all amendments, guaranties and other agreements relating thereto, pursuant to which an Obligor is entitled to the use or occupancy of any Real Estate for any period of time.
Leasehold” - any lease, leasehold estate or leasehold interest of any Obligor in each of the properties at or upon which any such Obligor conducts business, offers any Inventory for sale, or maintains any of the Collateral, whether or not for retail sale, together with such Obligor’s interest in any of the improvements and fixtures located upon or appurtenant to each such estate or interest, including, without limitation, any rights of any such Obligor to payment, proceeds or value of any kind or nature realized upon the sale, transfer or assignment of any such estate or interest, whether or not such sale, assignment or transfer occurs during any case commenced under the Bankruptcy Code.
Lease Rejection Date” - the last day of the 120-day lease rejection/assumption period, as such period may be extended or shortened by the Bankruptcy Court.
Lease Reserve” - a reserve, in an amount established by the Agent in its reasonable credit judgment, in respect of (a) Inventory held at any leased Store locations intended to be closed with respect to which the Lease therefor is terminated or is intended to be terminated by the applicable Obligor within twelve (12) weeks, (b) Inventory at leased Store locations with respect to which the Lease has not been assumed commencing on the Lease Reserve Commencement Date, or with respect to any specific location, the date that is twelve (12) weeks prior to the expiration of such period of time as shall have been consented to for rejection/assumption of such Lease by the landlord for such location and approved by the Bankruptcy Court, or (c) Inventory held at leased Store locations with respect to which there has been filed with the Bankruptcy Court a motion to compel the assumption or rejection of the Lease, in each case, in an amount determined by the Agent in is reasonable credit judgment.
Lease Reserve Commencement Date” means the date that is twelve (12) weeks prior to the Lease Rejection Date.
Lender Indemnitees” - Lenders and their officers, directors, employees, Affiliates, agents, advisors and attorneys.
Lenders” - as defined in the preamble to this Loan Agreement, including the Tranche A Lenders, the Tranche A-1 Lenders, the Agent in its capacity as a provider of Swingline Loans and any other Person who hereafter becomes a “Lender” pursuant to an Assignment and Assumption Agreement.
Lending Office” - as to any Lender, the office or offices of such Lender described as such in such Lender’s administrative questionnaire, or such other office or offices as a Lender may from time to time notify the Borrower Agent and the Agent, which office may include any Affiliate of such Lender or any domestic or foreign branch of such Lender or such Affiliate.
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Unless the context otherwise requires each reference to a Lender shall include its applicable Lending Office.
Letter of Credit” - any standby or documentary letter of credit issued by Issuing Bank for the account of a Borrower, or any indemnity, guarantee, exposure transmittal memorandum or similar form of credit support issued by the Agent or the Issuing Bank for the benefit of a Borrower.
Letter of Credit Expiration Date” - the date that is five (5) Business Days prior to the Termination Date then in effect (or, if such day is not a Business Day, the next preceding Business Day).
Letter-of-Credit Right” - as defined in the UCC.
Letter of Credit Subline” - $150,000,000.  The Letter of Credit Subline is part of, and not in addition to, the Tranche A Revolver Commitments.
LIBOR” - as defined in the definition of Adjusted LIBOR.
LIBOR Loan” - each set of LIBOR Tranche A Revolver Loans or LIBOR Tranche A-1 Revolver Loans having a common length and commencement of Interest Period.
LIBOR Tranche A Revolver Loan” - a Tranche A Revolver Loan that bears interest at Adjusted LIBOR plus the Applicable Margin for LIBOR Tranche A Revolver Loans.
LIBOR Tranche A-1 Revolver Loan” - a Tranche A-1 Revolver Loan that bears interest at Adjusted LIBOR plus the Applicable Margin for LIBOR Tranche A-1 Revolver Loans.
LIBOR Screen Rate” - the LIBOR quote on the applicable screen page the Agent designates to determine LIBOR pursuant to the definition of “Applicable Margin” (or such other commercially available source providing such quotations as may be designated by the Agent from time to time).
LIBOR Successor Rate” - as defined in Section 3.1.4(c).
LIBOR Successor Rate Conforming Changes” - with respect to any proposed LIBOR Successor Rate, any conforming changes to the definition of Base Rate, Interest Period, timing and frequency of determining rates and making payments of interest and other administrative matters as may be appropriate, in the discretion of the Agent, to reflect the adoption of such LIBOR Successor Rate and to permit the administration thereof by the Agent in a manner substantially consistent with market practice (or, if the Agent determines that adoption of any portion of such market practice is not administratively feasible or that no market practice for the administration of such LIBOR Successor Rate exists, in such other manner of administration as the Agent determines in consultation with the Borrowers).
Liabilities” - all claims, actions, suits, judgments, damages, losses, liability, obligations, responsibilities, fines, penalties, sanctions, costs, fees, taxes, commissions, charges, disbursements, and expenses, in each case of any kind or nature (including interest accrued thereon or as a result thereof and fees, charges and disbursements of financial, legal and other advisors and consultants), whether joint or several, whether or not indirect, contingent, consequential, actual, punitive, treble or otherwise.
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License” - any license or agreement under which an Obligor is authorized to use Intellectual Property in connection with any manufacture, marketing, distribution or disposition of Collateral, any use of Property or any other conduct of its business.
Licensor” - any Person from whom an Obligor obtains the right to use any Intellectual Property.
Lien” - any Person’s interest in Property securing an obligation owed to, or a claim by, such Person, whether such interest is based on common law, statute or contract, including liens, security interests, pledges, mortgages, deeds of trust, hypothecations, statutory trusts, reservations, exceptions, encroachments, easements, rights-of-way, covenants, conditions, restrictions, leases, and other title exceptions and encumbrances affecting Property.
Lien Waiver” - an agreement, in form and substance reasonably satisfactory to Agent, and giving effect to the provisions of the Order, by which (a) for any material Collateral located on leased premises, the lessor waives or subordinates any Lien it may have on the Collateral, and agrees to permit Agent to enter upon the premises and remove the Collateral or to use the premises to store or dispose of the Collateral; (b) for any Collateral held by a warehouseman, processor, shipper, customs broker or freight forwarder, such Person waives or subordinates any Lien it may have on the Collateral, agrees to hold any Documents in its possession relating to the Collateral as agent for Agent, and agrees to deliver the Collateral to Agent upon request; (c) for any Collateral held by a repairman, mechanic or bailee, such Person acknowledges Agent’s Lien, waives or subordinates any Lien it may have on the Collateral, and agrees to deliver the Collateral to Agent upon request; and (d) for any Collateral subject to a Licensor’s Intellectual Property rights, the Licensor grants to Agent the right, vis-à-vis such Licensor, to enforce Agent’s Liens with respect to the Collateral, including the right to dispose of it with the benefit of the Intellectual Property, whether or not a default exists under any applicable License.
Liquidation” - the exercise by the Agent of those rights and remedies accorded to the Agent under the Loan Documents and Applicable Law as a creditor of the Obligors with respect to the realization on the Collateral (after the occurrence and during the continuation of an Event of Default), and the conduct by the Obligors acting with the consent of the Agent, of any public, private or going-out-of-business sale or other disposition of the Collateral for the purposes of liquidating the Collateral, including, without limitation, the Specified Full-Chain Liquidation.
Loan” - a Tranche A Revolver Loan or Tranche A-1 Revolver Loan.
Loan Account” - the loan account established by each Lender on its books pursuant to Section 5.7.
Loan Agreement” - as defined in the Preamble.
Loan Documents” - this Loan Agreement, Other Agreements and Security Documents.
Margin Stock” - as defined in Regulation U of the Board of Governors.
Master Lease Agreement” - collectively, (i) Lease Agreement dated as of March 6, 2006 between Bonstores Realty One, LLC, a Delaware limited liability company, as landlord, and Bon-Ton, as successor by merger to Herberger’s Department Stores, LLC, a Minnesota limited liability company, as tenant, as it may be amended, restated, supplemented, modified, renewed or replaced in whole or in part from time to time in accordance with the Loan Documents, (ii) Master Lease Agreement dated as of March 6, 2006 between Bonstores Realty One, LLC, a
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Delaware limited liability company, as landlord, and Carson Pirie Scott II, Inc., formerly known as McRae’s, Inc., a Mississippi corporation, as tenant, as it may be amended, restated, supplemented, modified, renewed or replaced in whole or in part from time to time in accordance with the Loan Documents, (iii) Lease Agreement dated as of March 6, 2006 between Bonstores Realty One, LLC, a Delaware limited liability company, as landlord, and McRIL, LLC, a Virginia limited liability company, as tenant, as it may be amended, restated, supplemented, modified, renewed or replaced in whole or in part from time to time in accordance with the Loan Documents, (iv) Master Lease Agreement dated as of March 6, 2006 between Bonstores Realty One, LLC, a Delaware limited liability company, as landlord, and Bon-Ton, as successor by merger to Parisian, Inc., an Alabama corporation, as tenant, as it may be amended, restated, supplemented, modified, renewed or replaced in whole or in part from time to time in accordance with the Loan Documents,  (v) Lease Agreement dated as of March 6, 2006 currently between Bonstores Realty One, LLC, a Delaware limited liability company, as landlord, and Bon-Ton Distribution, Inc., formerly known as Saks Distribution Centers, Inc., an Illinois corporation, as tenant, as it may be amended, restated, supplemented, modified, renewed or replaced in whole or in part from time to time in accordance with the Loan Documents, (vi) Master Lease Agreement dated as of March 6, 2006 between Bonstores Realty One, LLC, a Delaware limited liability company, as landlord, and The Elder-Beerman Stores, Corp., an Ohio corporation, as tenant, as it may be amended, restated, supplemented, modified, renewed or replaced in whole or in part from time to time in accordance with the Loan Documents, (vii) Master Lease Agreement dated as of March 6, 2006 between Bonstores Realty Two, LLC, a Delaware limited liability company, as landlord, and Carson Pirie Scott II, Inc., formerly known as McRae’s, Inc., a Mississippi corporation, as tenant, as it may be amended, restated, supplemented, modified, renewed or replaced in whole or in part from time to time in accordance with the Loan Documents, (viii) Master Lease Agreement dated as of March 6, 2006 between Bonstores Realty Two, LLC, a Delaware limited liability company, as landlord, and McRIL, LLC, a Virginia limited liability company, as tenant, as it may be amended, restated, supplemented, modified, renewed or replaced in whole or in part from time to time in accordance with the Loan Documents, (ix) Master Lease Agreement dated as of March 6, 2006 between Bonstores Realty Two, LLC, a Delaware limited liability company, as landlord, and Bon-Ton, as successor by merger to Parisian, Inc., an Alabama corporation, as tenant, as it may be amended, restated, supplemented, modified, renewed or replaced in whole or in part from time to time in accordance with the Loan Documents and (x) such other leases and subleases as may be entered into between either BR1LLC or BR2LLC and an Obligor from time to time.
Material Adverse Effect” - the effect of any event or circumstance (except as customarily occurs as a result of events leading up to and following the commencement of a proceeding under Chapter 11 of the Bankruptcy Code and the commencement of the Chapter 11 Cases, and for general economic or political conditions or conditions generally applicable to the department store industry, or terrorist events or wars) that, taken as a whole, has or could be reasonably expected to have a material adverse effect on: (a) the business, operations, liabilities (actual or contingent), Properties, or financial condition of the Obligors and their Subsidiaries considered as a whole, or the value of the Collateral, taken as a whole, the enforceability of any Loan Documents, or on the validity or priority of Agent’s Liens on any Collateral; (b) the ability of the Obligors taken as a whole to perform any obligations under the Loan Documents, including repayment of any Obligations; or (c) the rights or remedies of the Agent or any Lender to enforce or collect the Obligations or to realize upon the Collateral.
Material Contract” - any agreement or arrangement to which Parent or a Subsidiary is party (other than the Loan Documents) (a) that is deemed to be a material contract under the Securities Exchange Act of 1934, (b) for which breach, termination, nonperformance or failure to
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renew could reasonably be expected to have a Material Adverse Effect, or (c) that relates to the Senior Note Debt or other Debt in an aggregate principal amount of $5,000,000 or more.
Minimum Collateral Amount” - at any time, (a) with respect to Cash Collateral consisting of cash or deposit account balances provided to reduce or eliminate Fronting Exposure during the existence of a Defaulting Lender, an amount equal to 100% of the Fronting Exposure of the Issuing Banks with respect to Letters of Credit issued and outstanding at such time, (b) with respect to Cash Collateral consisting of cash or deposit account balances provided in accordance with the provisions of Section 2.3.3(a), an amount equal to 105% of the then outstanding amount of all LC Obligations, and (c) otherwise, an amount determined by the Agent and the applicable Issuing Banks in their sole discretion.
MLPFS” - Merrill Lynch, Pierce, Fenner & Smith Incorporated.
Moody’s” - Moody’s Investors Service, Inc., and its successors.
Mortgage” - each mortgage, deed of trust or deed to secure debt pursuant to which an Obligor grants to the Agent, for the benefit of Secured Parties, Liens upon the Real Estate owned or leased by such Obligor, as security for the Obligations.
Multiemployer Plan” - any employee benefit plan or arrangement described in Section 4001(a)(3) of ERISA to which  any Obligor or Subsidiary or any of their respective ERISA Affiliates makes or is obligated to make contributions or, during the preceding five plan years, has made or been obligated to make contributions.
Net Proceeds” - with respect to an Asset Disposition, proceeds (including, when received, any deferred or escrowed payments) received by Parent or a Subsidiary in cash from such disposition, net of (a) reasonable and customary costs and expenses actually incurred in connection therewith, including legal fees and sales commissions; (b) amounts applied to repayment of Debt secured by a Permitted Lien senior to the Lien of the Agent securing the Obligations and the Pre-Petition Obligations, if applicable; (c) taxes arising Post-Petition due as a result of, or in connection with, such Asset Disposition; (d) reasonable reserves for indemnities, until such reserves are no longer needed; and (e) other costs and expenses otherwise required to be paid by the Order or another order of the Court (including, without limitation, the Carve Out) with the consent of the Agent.
Notes” - each Tranche A Revolver Note, Tranche A-1 Revolver Note or other promissory note executed by a Borrower to evidence any Obligations.
Notice of Borrowing” - a Notice of Borrowing to be provided by Borrower Agent to request the funding of a Borrowing of Loans, in form reasonably satisfactory to Agent.
Notice of Conversion/Continuation” - a Notice of Conversion/Continuation to be provided by Borrower Agent to request a conversion or continuation of any Loans as LIBOR Loans, in form reasonably satisfactory to Agent.
NRV Percentage” - the net orderly liquidation value of Inventory of each Borrower, expressed as a percentage (which shall be adjusted on a monthly basis), expected to be realized at an orderly, negotiated sale held within a reasonable period of time, net of all liquidation expenses, as determined from the most recent appraisal of Borrowers’ Inventory performed by an appraiser and on terms reasonably satisfactory to Agent.
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Obligations” - all (a) principal of and premium, if any, on the Loans (including those portions of the Pre-Petition Tranche A Prepayment Premium and the Pre-Petition Specified Tranche A-1 Prepayment Premium that are capitalized to the principal of the Tranche A Revolver Loans and the Tranche A-1 Revolver Loans on the Closing Date in accordance with Sections 2.1.7 and 2.1.8), (b) LC Obligations and other obligations of Obligors with respect to Letters of Credit, (c) interest, expenses, fees and other sums payable by Obligors under Loan Documents, (d) obligations of Obligors under any indemnity for Claims pursuant to Section 14.2, (e) Extraordinary Expenses, (f) Bank Product Debt, and (g) other Debts, obligations and liabilities of any kind owing by Obligors pursuant to the Loan Documents or in connection with any Bank Products, whether now existing or hereafter arising, whether evidenced by a note or other writing, whether or not allowed in any Insolvency Proceeding, whether arising from an extension of credit, issuance of a letter of credit, acceptance, loan, guaranty, indemnification or otherwise, and whether direct or indirect, absolute or contingent, due or to become due, primary or secondary, or joint or several; provided that the “Obligations” shall exclude any Excluded Swap Obligations.  For certainty, it is acknowledged and agreed that (i) the Order shall provide that the Obligors shall pay, on demand, all claims in respect of indemnification, expense reimbursement and other contingent claims arising under the Pre-Petition Loan Agreement, the other Pre-Petition Loan Documents or otherwise in respect of Pre-Petition Obligations and (ii) that such claims may be paid with the proceeds of Loans hereunder (which shall thereupon constitute “Obligations” hereunder) and/or from the proceeds of Collateral.
Obligor” - each Borrower, Guarantor, or other Person that is liable for payment of any Obligations or that has granted a Lien in favor of Agent on its assets to secure any Obligations.
Obligor Advisor” - as defined in Section 10.1.16.
Order” - as applicable, and as the context may require, the Interim Order or the Final Order, whichever is then applicable.
Ordinary Course of Business” - the ordinary course of business of Parent or any Subsidiary, consistent with past practices and undertaken in good faith.
Organic Documents” - with respect to any Person, its charter, certificate or articles of incorporation, bylaws, articles of organization, limited liability agreement, operating agreement, members agreement, shareholders agreement, partnership agreement, certificate of partnership, certificate of formation, voting trust agreement, or similar agreement or instrument governing the formation or operation of such Person.
OSHA” - the Occupational Safety and Hazard Act of 1970, as amended.
Other Agreement” - (a) each Note, Guaranty, LC Document, LC Guaranty, Fee Letter, Lien Waiver, Related Real Estate Document, Borrowing Base Certificate, Compliance Certificate, Approved Budget Variance Report or perfection certificate, (b) the Senior Note Intercreditor Agreement, (c) financial statement or report delivered hereunder, or (d) other document, instrument or agreement (other than this Loan Agreement or a Security Document) now or hereafter delivered by an Obligor or other Person to Agent or a Lender in connection with any transactions relating hereto.
Other Connection Taxes - with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security
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interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Documents).
Other Taxes” - all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to Section 3.6).
Overadvance Loan” - a Base Rate Tranche A Revolver Loan made or Letter of Credit issued, extended or renewed when a Tranche A Overadvance exists or is caused by the funding of a Tranche A Revolver Loan or the issuance of a Letter of Credit.
Parent” - The Bon-Ton Stores, Inc., a Pennsylvania corporation and parent company of Bon-Ton.
Participant” - as defined in Section 13.3.1.
Participant Register” - as defined in Section 13.3.1.
Patriot Act” - the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. No. 107-56, 115 Stat. 272 (2001).
Payment Intangible” - as defined in the UCC.
Payment Item” - each check, draft or other item of payment payable to an Obligor, including those constituting proceeds of any Collateral.
PBGC” - means the Pension Benefit Guaranty Corporation.
Pension Act” - means the Pension Protection Act of 2006.
Pension Funding Rules” - means the rules of the IRC and ERISA regarding minimum required contributions (including installment payment thereof) to Plans and Multiemployer Plans and set forth in, with respect to plan years ending prior to the effective date of the Pension Act, Section 412 of the IRC and Section 302 of ERISA, each as in effect prior to the Pension Act and, thereafter, Section 412, 430, 431 and 436 of the IRC and Sections 302, 303, 304 and 305 of ERISA.
Permit” - with respect to any Person, any permit, approval, authorization, license, registration, certificate, concession, grant, franchise, variance or permission from, and any other contractual obligations with, any Governmental Authority, in each case whether or not having the force of law and applicable to or binding upon such Person or any of its property or to which such Person or any of its property is subject.
Permitted Asset Disposition” - as long as no Default or Event of Default exists or would result therefrom and, if so required pursuant to Section 5.2, all Net Proceeds are remitted to Agent for application to the Obligations pursuant to Section 5.5, an Asset Disposition that is (a) a sale of Inventory or Equipment in the Ordinary Course of Business, (b) a disposition of Equipment or Inventory that is obsolete, unmerchantable or otherwise unsalable in the Ordinary
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Course of Business, (c) the non-exclusive licensing of Intellectual Property to third Persons on reasonable and customary terms in the Ordinary Course of Business consistent with past practice; provided that such licensing does not materially interfere with the business of the Parent or any other Obligor or otherwise impair the ability of the Obligors of the Agent to sell Collateral, (d) dispositions of accounts receivable (other than Credit Card Receivables) in connection with the compromise, settlement or collection thereof in the Ordinary Course of Business or in bankruptcy or similar proceedings (it being understood that customary chargebacks and offsets, discounts, allowances and credits by Credit Card Processors made in the Ordinary Course of Business shall not constitute a disposition of a Credit Card Receivable for the purposes of this clause (d)), (e) any Investment which is not a Restricted Investment, (f) the unwinding of any Hedging Agreements, (g) subleases existing as of the Petition Date and entered into in the Ordinary Course of Business of any Obligor, (h) the Specified Store Closing Sales, (i) any Specified Sale Transaction, (j) an abandonment of immaterial Intellectual Property that is obsolete or otherwise uneconomic in the Ordinary Course of Business and (k) a transfer of condemned property as a result of the exercise of “eminent domain” or other similar policies to the respective Governmental Authority or agency that has condemned the same (whether by deed in lieu of condemnation or otherwise), and transfers of properties that have been subject to a casualty to the respective insurer of such property as part of an insurance settlement.
Permitted Business” - any business conducted or proposed to be conducted by the Parent and the other Obligors on the Closing Date and other businesses reasonably related or ancillary thereto.
Permitted Contingent Obligations” - Contingent Obligations (a) arising from endorsements of Payment Items for collection or deposit in the Ordinary Course of Business; (b) arising from Hedging Agreements permitted hereunder; (c) existing on the Closing Date and described on Schedule 10.2.1 under the heading “Existing Permitted Contingent Obligations”, and any extension or renewal thereof that does not increase the amount of such Contingent Obligation when extended or renewed; (d) incurred in the Ordinary Course of Business with respect to letters of credit or surety, appeal or performance bonds, or other similar obligations; (e) arising from customary indemnification obligations in favor of purchasers in connection with dispositions permitted hereunder; (f) arising under the Loan Documents; or (g) in an aggregate amount of $1,000,000 or less at any time.
Permitted Holders” - (a) Tim Grumbacher and his immediate family members (as defined by the NASDAQ listing requirements) or the spouses and former spouses (including widows and widowers), heirs or lineal descendants of any of the foregoing; (b) an estate, trust (including a revocable trust, declaration of trust or a voting trust), guardianship, other legal representative relationship or custodianship for the primary benefit of one or more individuals described in clause (a) above or controlled by one or more individuals described in clause (a) above; (c) a corporation, partnership, limited liability company, foundation, charitable organization or other entity if a majority of the voting power and, if applicable, a majority of the value of the equity ownership of such corporation, partnership, limited liability company, foundation, charitable organization or other entity is directly or indirectly owned by or for the primary benefit of one or more individuals or entities described in clauses (a) or (b) above; (d) a corporation, partnership, limited liability company, foundation, charitable organization or other entity controlled directly or indirectly by one or more individuals or entities described in clauses (a), (b) or (c) above; and (e) any “person” (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Securities Exchange Act of 1934, or any successor provision) acting on behalf of the Parent as underwriter pursuant to an offering that is temporarily holding securities in connection with such offering.
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Permitted Insolvency Increase Amount” - on any date of determination, an amount equal to five percent (5%) of the “Aggregate Borrowing Base” under, and as defined in, the Pre-Petition Loan Agreement, as determined by the Agent, on behalf of the Tranche A Lenders, in its reasonable discretion.
Permitted Lien” - as defined in Section 10.2.2.
Permitted Purchase Money Debt” - Purchase Money Debt of Parent and Subsidiaries that is unsecured or secured only by a Purchase Money Lien, as long as the aggregate principal amount does not exceed $5,000,000 at any time and all payments in respect of such Purchase Money Debt are expressly contemplated by the Approved Budget.
Person” - any individual, corporation, limited liability company, partnership, joint venture, joint stock company, land trust, business trust, unincorporated organization, Governmental Authority or other entity.
Petition Date” - as defined in the Recitals.
Plan” - an “employee pension benefit plan” as defined in Section 3 of ERISA that is covered by Title IV of ERISA or subject to the minimum funding standards under Section 412 of the IRC and that is maintained or contributed to (or to which there is or has been, during the preceding five plan years thereof, an obligation to contribute) by any Obligor or Subsidiary or any of their respective ERISA Affiliates (other than a Multiemployer Plan).
Pledge Agreement” - each pledge agreement pursuant to which an Obligor pledges to Agent, for the benefit of Secured Parties, such Obligor’s Capital Stock, as security for the Obligations.
Post-Petition” - the time period commencing immediately upon the filing of the applicable Chapter 11 Cases.
Prepaid Pre-Petition Tranche A-1 Revolver Loans” - as defined in Section 2.1.6(b).
Pre-Petition” - the time period ending immediately prior to the filing of the applicable Chapter 11 Cases.
Pre-Petition Agent” - the “Agent” as defined in the Pre-Petition Loan Agreement.
Pre-Petition Closing Date” - March 21, 2011.
 “Pre-Petition Loan Agreement” - as defined in the Recitals.
Pre-Petition Lenders” - the “Lenders” from time to time party to the Pre-Petition Loan Agreement.
Pre-Petition LC Obligations” - Pre-Petition Obligations in respect of “LC Obligations” under, and as defined in, the Pre-Petition Loan Agreement.
Pre-Petition Loan Documents” - the “Loan Documents” as defined in the Pre-Petition Loan Agreement.
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Pre-Petition Loans” - the Pre-Petition Tranche A Revolver Loans and the Pre-Petition Tranche A-1 Revolver Loans.
Pre-Petition Mortgage” - each mortgage, deed of trust or deed to secure debt set forth on Schedule 1.1(e).
Pre-Petition Obligations” - all of the “Obligations” as defined in the Pre-Petition Loan Agreement.
Pre-Petition Securities Pledge Agreement” – that certain Second Amended and Restated Securities Pledge Agreement, dated as of March 21, 2011, by and among the Obligors and the Agent, as amended, supplemented or otherwise modified from time to time.
Pre-Petition Security Documents” - the “Security Documents” as defined in the Pre-Petition Loan Agreement.
Pre-Petition Specified Tranche A-1 Prepayment Premium” - the “Specified Tranche A-1 Prepayment Premium” as defined in the Pre-Petition Loan Agreement.
Pre-Petition Tranche A Credit Extensions” - the sum of (a) the Pre-Petition Tranche A Revolver Loans and (b) the Pre-Petition LC Obligations.
Pre-Petition Tranche A Revolver Commitments” - the “Tranche A Revolver Commitments” under, and as defined in, the Pre-Petition Loan Agreement.
Pre-Petition Tranche A Revolver Loans” - the  Pre-Petition Obligations in respect of principal of “Tranche A Revolver Loans” under, and as defined in, the Pre-Petition Loan Agreement.
Pre-Petition Tranche A Lenders” - the “Tranche A Lenders” from time to time party to the Pre-Petition Loan Agreement.
Pre-Petition Tranche A-1 Lenders” - the “Tranche A-1 Lenders” from time to time party to the Pre-Petition Loan Agreement.
Pre-Petition Tranche A Prepayment Premium” - the “Tranche A Prepayment Premium” as defined in the Pre-Petition Loan Agreement.
Pre-Petition Tranche A-1 Prepayment Premium” - the “Tranche A-1 Prepayment Premium” as defined in the Pre-Petition Loan Agreement.
Pre-Petition Tranche A-1 Revolver Loans” - the Pre-Petition Obligations in respect of principal of “Tranche A-1 Revolver Loans” under, and as defined in, the Pre-Petition Loan Agreement.
Permitted Prior Liens” – “Prepetition ABL Permitted Prior Liens” as defined in the Order.
Prior Week” - as of any date of determination, the immediately preceding week ended on a Saturday and commencing on the prior Sunday.
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Pro Rata” - (a) with respect to any Tranche A Lender, a percentage (expressed as a decimal, rounded to the ninth decimal place) determined (i) while the Tranche A Revolver Commitments are outstanding, by dividing the amount of such Tranche A Lender’s Tranche A Revolver Commitment by the aggregate amount of all Tranche A Revolver Commitments; and (ii) at any other time, by dividing the amount of such Tranche A Lender’s Tranche A Revolver Loans and LC Obligations by the aggregate amount of all outstanding Tranche A Revolver Loans and LC Obligations and (b) with respect to any Tranche A-1 Lender, a percentage (expressed as a decimal, rounded to the ninth decimal place) determined by dividing the amount of such Tranche A-1 Lender’s Tranche A-1 Revolver Commitment by the aggregate amount of all Tranche A-1 Revolver Commitments.
Properly Contested” - with respect to any obligation of an Obligor, (a) the obligation is subject to a bona fide dispute regarding amount or the Obligor’s liability to pay; (b) the obligation is being properly contested in good faith by appropriate proceedings promptly instituted and diligently pursued; (c) appropriate reserves have been established in accordance with GAAP; (d) non-payment could not be reasonably expected to have a Material Adverse Effect, nor result in forfeiture or sale of any assets of the Obligor; (e) no Lien is imposed on assets of the Obligor, unless bonded and stayed to the reasonable satisfaction of Agent; and (f) if the obligation results from entry of a judgment or other order, such judgment or order is stayed pending appeal or other judicial review or subject to the Automatic Stay.
Property” - any interest in any kind of property or asset, whether real, personal or mixed, or tangible or intangible.
Protective Advances” - as defined in Section 2.1.5.
PTE” - a prohibited transaction class exemption issued by the U.S. Department of Labor, as any such exemption may be amended from time to time.
Purchase Money Debt” - (a) Debt (other than the Obligations) for payment of any of the purchase price of fixed assets; (b) Debt (other than the Obligations) incurred within 10 days before or after acquisition of any fixed assets, for the purpose of financing any of the purchase price thereof; (c) Capital Leases and (d) any renewals, extensions or refinancings (but not increases) thereof.
Purchase Money Lien” - a Lien that secures Purchase Money Debt, encumbering only the fixed assets acquired with such Debt, and any proceeds thereof, and constituting a Capital Lease, a purchase money security interest under the UCC or a purchase money mortgage.
Qualified ECP Guarantor” - at any time, each Obligor with total assets exceeding $10,000,000 or that qualifies at such time as an “eligible contract participant” under the Commodity Exchange Act and can cause another person to qualify as an “eligible contract participant” at such time under §1a(18)(A)(v)(II) of the Commodity Exchange Act.
RCRA” - the Resource Conservation and Recovery Act (42 U.S.C. §§ 6991-6991i).
Real Estate” - all right, title and interest (whether as owner, lessor or lessee) in any real Property or any buildings, structures, parking areas or other improvements thereon.
Recipient” - Agent, any Lender, any Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of any Obligor hereunder.
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Register” - as defined in Section 13.2.2.
Reimbursement Date” - as defined in Section 2.3.2.
Related Parties” - with respect to any Person, such Person’s Affiliates and the partners, directors, officers, employees, agents, trustees, attorneys and advisors of such Person and of such Person’s Affiliates.
Related Real Estate Documents” - with respect to any Real Estate subject to a Mortgage, the following, in form and substance reasonably satisfactory to the Agent and received by the Agent for review at least 15 days prior to the effective date of the Mortgage (or such shorter length of time acceptable to the Agent in its reasonable discretion):  (a) a mortgagee title policy (or binder therefor) covering the Agent’s interest under the Mortgage, in a form and amount and by an insurer reasonably acceptable to Agent, which must be fully paid on such effective date; (b) such assignments of leases, rents, estoppel letters, attornment agreements, consents, waivers and releases as the Agent may require with respect to other Persons having an interest in the Real Estate; (c) a survey of the Real Estate, containing a metes and bounds property description and flood plain certification, and certified by a licensed surveyor reasonably acceptable to the Agent; (d) flood insurance in an amount, with endorsements and by an insurer reasonably acceptable to the Agent (and otherwise as required by Flood Insurance Laws), if the Real Estate is within a flood plain; (e) a current appraisal of the Real Estate, prepared by an appraiser reasonably acceptable to the Required Lenders, and in form and substance satisfactory to the Required Lenders; (f) a Phase I (and to the extent appropriate, Phase II) environmental assessment report, prepared by an environmental consulting firm reasonably satisfactory to the Agent, and accompanied by such reports, certificates, studies or data as the Agent may reasonably require, which shall all be in form and substance reasonably satisfactory to the Agent; (g) an Environmental Agreement and such other documents, instruments or agreements as the Agent may reasonably require with respect to any environmental risks regarding the Real Estate; and (h) a written opinion of local counsel relating to each Mortgage and with respect to such other matters as the Agent may reasonably request, in each case, in form and substance reasonably acceptable to the Agent.  The Agent may, in its discretion, permit the Obligors to satisfy the foregoing requirements described in clauses (a) through (h) above through the previous delivery by the Obligors of the corresponding items in connection with the Pre-Petition Mortgages.
Rent and Charges Reserve” - the aggregate of (a) all past due rent and other amounts owing by an Obligor to any landlord, warehouseman, processor, repairman, mechanic, shipper, freight forwarder or other Person who possesses any Collateral or could assert a Lien on any Collateral; and (b) a reserve at least equal to three months’ rent and other charges that could be payable to any such Person, unless it has executed a Lien Waiver.
Report” - as defined in Section 12.2.3.
Reportable Event” - any event set forth in Section 4043 of ERISA, other than events for which the thirty (30) day notice period has been waived.
Required Lenders” - Lenders (subject to Section 4.2) having (a) Commitments in excess of 50% of the aggregate Commitments; and (b) upon the occurrence of the Commitment Termination Date, Loans and LC Obligations in excess of 50% of all outstanding Loans and LC Obligations; provided that the unused Commitments of, and the portion of the Loans and LC Obligations held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders.
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Required Tranche A-1 Lenders” - Lenders having Tranche A-1 Revolver Loans in excess of 50% of all outstanding Tranche A-1 Revolver Loans; provided that the portion of the Tranche A-1 Revolver Loans held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Tranche A-1 Lenders.
Reserve Percentage” - means, for any day during any Interest Period, the reserve percentage (expressed as a decimal, carried out to five decimal places) in effect on such day, whether or not applicable to any Lender, under regulations issued from time to time by the Board of Governors for determining the maximum reserve requirement (including any emergency, supplemental or other marginal reserve requirement) with respect to Eurocurrency funding (currently referred to as “Eurocurrency Liabilities”).  Adjusted LIBOR for each outstanding LIBOR Loan shall be adjusted automatically as of the effective date of any change in the Reserve Percentage.
Restricted Investment” - any Investment by Parent or a Subsidiary, other than (a) (i) Investments in Subsidiaries to the extent existing on the Closing Date and (ii) Investments in any Borrower or Guarantor; (b) Cash Equivalents that are subject to Agent’s Lien and control to the extent required hereunder, pursuant to documentation in form and substance reasonably satisfactory to Agent; (c) loans and advances permitted under Section 10.2.6, (d) investments held by the Obligors comprised of notes payable, or stock or other securities issued by Account Debtors to any Obligor pursuant to negotiated agreements with respect to settlement of such Account Debtor’s Accounts in the Ordinary Course of Business, (e) Investments evidenced by Hedging Agreements which are otherwise permitted to be entered into pursuant to Section 10.2.10, (f) stock, obligations or securities received in connection with the bankruptcy or reorganization of, or settlement of delinquent accounts and disputes with, customers and suppliers, in each case in the Ordinary Course of Business or received in satisfaction of judgment, (g) advances to customers or suppliers in the Ordinary Course of Business that are, in conformity with GAAP, recorded as accounts receivable, prepaid expenses or deposits on the balance sheet of any Obligor and endorsements for collection or deposit arising in the Ordinary Course of Business, (h) commission, payroll, travel and similar advances to officers and employees of any Obligor so long as such advances are otherwise permitted under Section 10.2.6, (i) Investments consisting of the licensing or contribution of Intellectual Property in the ordinary course of business, (j) Investments existing on the Closing Date and described on Schedule 1.1(b) and modifications, extensions, or replacements thereof so long as the amount of the original Investment does not increase except by the terms of such Investment or as otherwise permitted hereunder, (k) Investments resulting from deposits referred to herein in Sections 10.2.2(e), (j), (k) and (m), and other deposits made in the Ordinary Course of Business and in accordance with the Approved Budget securing obligations or performance under real estate or personal property leases, (l) Investments in connection with Specified Sale Transactions and a Specified Store Closing Sale and (m) Investments constituting guaranties permitted by Section 10.2.1(i).
Restrictive Agreement” - an agreement (other than a Loan Document) that conditions or restricts the right of any Borrower, Subsidiary or other Obligor to incur or repay Borrowed Money, to grant Liens on any assets, to declare or make Distributions, to modify, extend or renew any agreement evidencing Borrowed Money, or to repay any intercompany Debt.
Restructuring Advisor” - as defined in Section 10.1.16.
Remedies Notice Period” - has the meaning assigned to the term “Remedies Notice Period” in the Interim Order (or the Final Order, when applicable).
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S&P” - Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc., and its successors.
Scheduled Unavailability Date”- as defined in Section 3.1.4(c).
Sanction(s) ” - means any international economic sanction administered or enforced by the United States Government (including, without limitation, OFAC), the United Nations Security Council, the European Union, Her Majesty’s Treasury or other relevant sanctions authority.
Sarbanes-Oxley” - the Sarbanes-Oxley Act of 2002, as amended and in effect.
Securities Account” - as defined in the UCC.
Securities Laws” - the Securities Act of 1933, the Securities Exchange Act of 1934, Sarbanes-Oxley and the applicable accounting and auditing principles, rules, standards and practices promulgated, approved or incorporated by the SEC or the Public Company Accounting Oversight Board, as each of the foregoing may be amended and in effect on any applicable date hereunder.
Secured Parties” – the Agent, the Co-Collateral Agents, the Issuing Banks, the Lenders and providers of Bank Products.
Security Documents” - the Order, this Loan Agreement, Pledge Agreements, Mortgages, the Pre-Petition Mortgages, Trademark Security Agreements, the Copyright Security Agreements, the Account Control Agreements and all other documents, instruments and agreements now or hereafter securing (or given with the intent to secure) any Obligations.
Senior Note Agent” - Wells Fargo Bank, National Association, as collateral agent for the Senior Note Secured Parties, and as trustee under the Senior Note Indenture, and its successors and assigns in such capacities.
Senior Note Debt” - the Debt of Bon-Ton pursuant to the Senior Note Debt Documents in an aggregate principal amount not to exceed $350,000,000.
Senior Note Debt Documents” - the Senior Note Indenture, the senior notes issued by Bon-Ton in connection therewith, and all other instruments and documents from time to time executed in favor of all or any of the holders of the Senior Note Debt.
Senior Note Indenture” - the Indenture, dated as of May 28, 2013, by and among Bon-Ton, as the issuer, the other Obligors, as the guarantors, and the Senior Note Agent.
Senior Note Intercreditor Agreement” - that certain Intercreditor Agreement, dated as of July 9, 2012, by and among the Agent, the Obligors from time to time party thereto, and the Senior Note Agent, as amended, amended and restated, restated, supplemented or otherwise modified from time to time in accordance with the terms thereof.
Senior Note Secured Parties” - the “Indenture Secured Parties” as defined in the Senior Note Intercreditor Agreement.
Senior Officer” - the chairman of the board, president, chief executive officer, treasurer, assistant treasurer, member manager or chief financial officer of a Borrower or, if the context requires, an Obligor.
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Settlement Report” - a report delivered by the Agent to the Tranche A Lenders summarizing the Loans and participations in LC Obligations outstanding as of a given settlement date, allocated to Lenders on a Pro Rata basis in accordance with their Tranche  A Revolver Commitments.
Software” - as defined in the UCC.
Specified Full-Chain Liquidation” - a liquidation on an equity basis (or, if approved by the Agent, the Co-Collateral Agents and the Tranche A-1 Documentation Agent in their sole discretion, on a fee basis) of the entire chain of Stores (or the entire chain of Stores remaining after completion of, or not contemplated to be included in, the Specified Going Concern Sale) of the Debtors and all of the assets relating thereto under Section 363 of the Bankruptcy Code.  The Specified Full-Chain Liquidation shall be conducted pursuant to bidding procedures, sales procedures, approval orders, purchase agreements, agency documents or other agreements, documents or instruments, as applicable, in form and substance and on terms satisfactory to the Agent.
Specified Going Concern Sale” - a sale, in one or a series of related transactions, of all or substantially all of (or, if approved in writing by the Agent, certain of) the assets of the Debtors as a going concern under Section 363 of the Bankruptcy Code.  The Specified Going Concern Sale shall be conducted pursuant to bidding procedures, sales procedures, approval orders, purchase agreements, agency documents or other agreements, documents or instruments, as applicable, in form and substance and on terms satisfactory to the Agent.
Specified IP Sale” - a sale, in one or a series of related transactions, of all of the Intellectual Property of the Debtors under Section 363 of the Bankruptcy Code to the extent such assets are not otherwise included in any Specified Going Concern Sale or Specified Full-Chain Liquidation required to be consummated pursuant to Schedule 10.1.18.  The Specified IP Sale shall be conducted pursuant to bidding procedures, sales procedures, approval orders, purchase agreements, agency documents or other agreements, documents or instruments, as applicable, in form and substance and on terms satisfactory to the Agent.
Specified Liquidation Agent” – collectively, Hilco Merchant Resources and Gordon Brothers Group, together with their Affiliates acting with respect to the Specified Store Closing Sales described in the definition thereof.
Specified Liquidation Agreement” - that certain liquidation agreement by and among the Parent and the Specified Liquidation Agent, which, among other things provides for the Specified Store Closing Sales referenced in clause (a) of such definition on terms satisfactory to the Agent, and which agreement, together with (x) all material documents relating thereto and (y) all exhibits, annex and schedules thereto, shall be approved by the Agent prior to execution, as further amended, supplemented and modified with the consent of the consent of the Agent.
Specified Obligor” - means any Obligor that is not an “eligible contract participant” under the Commodity Exchange Act (determined prior to giving effect to Section 14.20).
Specified Other Assets Sale” - sale of all remaining assets of the Debtors under Section 363 of the Bankruptcy Code (including mortgaged Real Estate interests and leasehold Real Estate interests) to the extent such assets are not otherwise included in any Specified Going Concern Sale or Specified Full-Chain Liquidation required to be consummated pursuant to Schedule 10.1.18.  The Specified Other Assets Sale shall be conducted pursuant to bidding procedures, sales procedures, approval orders, purchase agreements, agency documents or other
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agreements, documents or instruments, as applicable, in form and substance and on terms satisfactory to the Agent.
Specified Sale Transaction” - any or all of a Specified Going Concern Sale, a Specified Full-Chain Liquidation, a Specified IP Sale, or a Specified Other Assets Sale.
Specified Store Closing Sale” - (a) the closure of up to 45 Store locations of the Obligors listed on Schedule 1.1(d) conducted by the Specified Liquidation Agent pursuant to the Specified Liquidation Agreement and (b) the closure of any additional Stores approved in writing by the Agent in its reasonable discretion (subject to the performance of a desktop appraisal in form and substance acceptable to the Agent), and the liquidation of assets related thereto by a liquidator approved by the Agent (it being agreed that the Specified Liquidation Agent shall be satisfactory) pursuant to bidding procedures, a liquidation agreement approved by the Agent and all other relevant documents executed in connection therewith, each, as applicable, to be in form and substance reasonably satisfactory to the Agent.
Statutory Reserves” - the percentage (expressed as a decimal) established by the Board of Governors as the then stated maximum rate for all reserves (including those imposed by Regulation D of the Board of Governors, all basic, emergency, supplemental or other marginal reserve requirements, and any transitional adjustments or other scheduled changes in reserve requirements) applicable to any member bank of the Federal Reserve System in respect of Eurocurrency Liabilities (or any successor category of liabilities under Regulation D).
Store” - any retail department store operated by the Parent or any of its Subsidiaries.
Subsidiary” - any entity at least 50% of whose voting securities or Capital Stock is owned by any Obligor or any combination of Obligors (including indirect ownership by an Obligor through other entities in which such Obligor directly or indirectly owns 50% of the voting securities or Capital Stock).
Successor Case” - with respect to the Chapter 11 Cases, any subsequent proceedings under Chapter 7 of the Bankruptcy Code.
Supermajority Lenders” - Lenders (subject to Section 4.2) having (a) Commitments in excess of 75% of the aggregate Commitments; and (b) upon the occurrence of the Commitment Termination Date, Loans and LC Obligations in excess of 75% of all outstanding Loans and LC Obligations; provided that the unused Commitments of, and the portion of the Loans and LC Obligations held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Supermajority Lenders.
Supermajority Required Tranche A-1 Lenders” - Lenders having Tranche A-1 Revolver Loans in excess of 75% of all outstanding Tranche A-1 Revolver Loans; provided that the portion of the Tranche A-1 Revolver Loans held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Supermajority Required Tranche A-1 Lenders.
Supporting Obligation” - as defined in the UCC.
Swap Obligations” - means with respect to any Guarantor any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1a(47) of the Commodity Exchange Act.
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Swingline Loan” - any Borrowing of Base Rate Tranche A Revolver Loans funded with the Agent’s funds, until such Borrowing is settled among Lenders pursuant to Section 4.1.3.
Syndication Agents” - as defined in the Preamble.
Taxes” - all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.
Termination Date” - the earliest to occur of (a) November 1, 2018, (b) the date on which the maturity of the Obligations is accelerated (or deemed accelerated) and the Commitments are irrevocably terminated (or deemed terminated) in accordance with Section 11, whether by acceleration or otherwise, (c) the effective date of a plan of reorganization for the Debtors, (d) the date of consummation of a sale of all or substantially all of the Debtors’ assets under Section 363 of the Bankruptcy Code; (e) the date of conversion of any of the Chapter 11 Cases to a case under Chapter 7 of the Bankruptcy Code unless otherwise consented to in writing by the Agent, (f) the first business day on which the Interim Order expires by its terms or is terminated, unless the Final Order has been entered and become effective prior thereto, and (g) dismissal of any of the Chapter 11 Cases, unless otherwise consented to in writing by the Agent.
Trademark Security Agreements” - each trademark collateral security and pledge agreement or other trademark security agreement pursuant to which an Obligor grants to the Agent, for the benefit of Secured Parties, a Lien on such Obligor’s interests in trademarks, as security for the Obligations.
Tranche A Borrowing Base” - on any date of determination, an amount equal to the lesser of (a) the aggregate amount of Tranche A Revolver Commitments on such date and (b) the sum of (i) the Tranche A Inventory Formula Amount on such date, plus (ii) the Tranche A Real Estate Availability Amount on such date, plus (iii) Tranche A Credit Card Receivables Amount on such date, plus (iv) the Tranche A Check Receivables Amount on such date, plus (v) the Permitted Insolvency Increase Amount on such date, minus (vi) the Availability Reserve on such date.  Notwithstanding the foregoing, in no event shall the Tranche A Real Estate Availability Amount included in the Tranche A Borrowing Base exceed 17.5% of the Tranche A Borrowing Base.
Tranche A Check Receivables Amount” - on any date of determination, an amount equal to 90% of the book value of Eligible Check Receivables on such date.
Tranche A Closing Fee Letter” - the Tranche A Closing Fee Letter, dated as of February 7, 2018, by and among the Obligors and Bank of America, as amended, amended and restated, restated, supplemented or otherwise modified and in effect from time to time.
Tranche A Credit Card Receivables Amount” - on any date of determination, an amount equal to 90% of the book value of Eligible Credit Card Accounts on such date.
Tranche A Inventory Formula Amount” - on any date of determination, an amount equal to 85% of the NRV Percentage of the Value of Eligible Inventory on such date.
Tranche A Lenders” - the Lenders indicated on Schedule 1.1(a) as Lenders of Tranche A Revolver Loans, the Agent in its capacity as a provider of Swingline Loans and any other Person who hereafter becomes a “Tranche A Lender” pursuant to an Assignment and Assumption Agreement.
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Tranche A Overadvance” - as defined in Section 2.1.4.
Tranche A Real Estate Amount” - at any date of determination, an amount equal to 50% of the Appraised Value of Eligible Real Estate on such date.
Tranche A Real Estate Availability Amount” - on any date of determination, an amount equal to the lesser of (x) $100,000,000 minus the Tranche A-1 Real Estate Amount (or, for the avoidance of doubt, any portion thereof) utilized in the calculation of the Tranche A-1 Borrowing Base on such date and (y) the Tranche A Real Estate Amount on such date.
Tranche A Revolver Commitment” - for any Tranche A Lender, its obligation to make Tranche A Revolver Loans and to participate in LC Obligations up to the maximum principal amount shown on Schedule 1.1(a), or as specified hereafter in the most recent Assignment and Assumption Agreement to which it is a party.  On and as of the Closing Date, the aggregate Tranche A Revolver Commitments are $600,000,000.
Tranche A Revolver Loan” - (a) a Loan made pursuant to Section 2.1.1(a), (b) any Swingline Loan, (c) any Overadvance Loan deemed by Agent to be a Tranche A Revolver Loan or (d) any Protective Advance deemed by Agent to be a Tranche A Revolver Loan.
Tranche A Revolver Note” - a promissory note to be executed by Borrowers in favor of a Tranche A Lender in the form of Exhibit A, which shall evidence the Tranche A Revolver Loans made by such Lender.
Tranche A Revolver Reduction Amount” - as defined in Section 2.1.7.
Tranche A-1 Borrowing Base” - on any date of determination, an amount equal to the lesser of (a) the aggregate amount of the Tranche A-1 Revolver Commitments on such date and (b) the sum of (i) the Tranche A-1 Inventory Formula Amount on such date, plus (ii) the Tranche A-1 Real Estate Amount on such date, plus (iii) the Tranche A-1 Credit Card Receivables Amount on such date, plus (iv) the Tranche A-1 Check Receivables Amount on such date, minus (v) the Availability Reserve on such date (to the extent not already deducted in the Tranche A Borrowing Base).  Notwithstanding the foregoing, in no event shall the Tranche A-1 Real Estate Amount included in the Tranche A-1 Borrowing Base exceed 17.5% of the Tranche A-1 Borrowing Base.
Tranche A-1 Check Receivables Amount” - on any date of determination, an amount equal to 5% of the book value of Eligible Check Receivables on such date.
Tranche A-1 Closing Fee Letter” - the Tranche A-1 Closing Fee Letter, dated as of February 7, 2018, by and among the Obligors, Bank of America and Crystal Financial LLC, as amended, amended and restated, restated, supplemented or otherwise modified and in effect from time to time.
Tranche A-1 Credit Card Receivables Amount” - on any date of determination, an amount equal to 5% of the book value of Eligible Credit Card Accounts on such date.
Tranche A-1 Documentation Agent” - Crystal Financial LLC, in its capacity as documentation agent for the Tranche A-1 Lenders, together with its successors and assigns in such capacity.
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Tranche A-1 Documentation Agent Indemnitees” - Tranche A-1 Documentation Agent and its Related Parties.
Tranche A-1 Inventory Formula Amount” - on any date of determination, an amount equal to 20% of the NRV Percentage of the Value of Eligible Inventory on such date.
Tranche A-1 Lenders” - the Lenders indicated on Schedule 1.1(a) as Lenders of Tranche A-1 Revolver Loans and any other Person who hereafter becomes a “Tranche A-1 Lender” pursuant to an Assignment and Assumption Agreement.
Tranche A-1 Real Estate Amount” - at any date of determination, an amount equal to 10% of the Appraised Value of Eligible Real Estate on such date.
Tranche A-1 Revolver Commitment” - for any Tranche A-1 Lender, (a) on the Closing Date and prior to the Borrowing of Tranche A-1 Revolver Loans on such date, such Tranche A-1 Lender’s obligation to make Tranche A-1 Revolver Loans on such date up to the maximum principal amount shown on Schedule 1.1(a), and (b) on and after the Closing Date and following the Borrowing of Tranche A-1 Revolver Loans on such date, the aggregate principal amount of Tranche A-1 Revolver Loans held by such Tranche A-1 Lender.  On and as of the Closing Date, the aggregate Tranche A-1 Revolver Commitments are $125,000,000.
Tranche A-1 Revolver Loan” - a Loan made or deemed made pursuant to Section 2.1.1(b) and Section 2.1.6(b).
Tranche A-1 Revolver Note” - a promissory note to be executed by Borrowers in favor of a Lender in the form of Exhibit B, which shall evidence the Tranche A-1 Revolver Loans made by such Lender.
Tranche A-1 Utilization Amount” - on any date of determination, the greater of (a) $0 and (b) the amount, if any, by which the aggregate outstanding principal amount of all Tranche A-1 Revolver Loans (plus the aggregate outstanding principal amount of all Pre-Petition Tranche A-1 Revolver Loans, if any) exceeds the Tranche A-1 Borrowing Base.  For the avoidance of doubt, in no event shall the Pre-Petition Tranche A Prepayment Premium (after giving effect to the waiver thereof with respect to the Tranche A Revolver Reduction Amount) or the Pre-Petition Specified Tranche A-1 Prepayment Premium (after giving effect to the waiver thereof with respect to the Prepaid Pre-Petition Tranche A-1 Revolver Loans) be included in any determination of borrowing availability hereunder, including any determination of Excess Availability or the Tranche A-1 Utilization Amount.
Transferee” - any actual or potential Eligible Assignee, Participant or other Person acquiring an interest in any Obligations.
Type” - any type of a Loan (i.e., Base Rate Loan or LIBOR Loan) that has the same interest option and, in the case of LIBOR Loans, the same Interest Period.
UCC” - the Uniform Commercial Code as in effect in the State of New York or, when the laws of any other jurisdiction govern the perfection or enforcement of any Lien, the Uniform Commercial Code of such jurisdiction.
UCP” - with respect to any Letter of Credit, the Uniform Customs and Practice for Documentary Credits, International Chamber of Commerce (“ICC”) Publication No. 600 (or such later version thereof as may be in effect at the time of issuance).
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Unused Line Fee Rate” - 0.25% per annum.
Upstream Payment” - a Distribution by a Subsidiary or any Obligor to any Obligor.
U.S. Person - any Person that is a “United States Person” as defined in Section 7701(a)(30) of the IRC.
U.S. Tax Compliance Certificate” - has the meaning specified in Section 5.8.5(b)(ii)(3).
U.S. Trustee” - the United State Trustee applicable to the Chapter 11 Cases.
Value” - for Inventory, its value determined on the basis of the lower of cost or market, calculated on a first-in, first-out basis.
Voting Stock” - of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of the Board of Directors of such Person.
Wells Fargo” - Wells Fargo Bank, National Association.
Write-Down and Conversion Powers” - means, with respect to any EEA Resolution Authority, the write-down and conversion powers of such EEA Resolution Authority from time to time under the Bail-In Legislation for the applicable EEA Member Country, which write-down and conversion powers are described in the EU Bail-In Legislation Schedule.
1.2.         Accounting Terms.  Under the Loan Documents (except as otherwise specified herein), all accounting terms shall be interpreted, all accounting determinations shall be made, and all financial statements shall be prepared, in accordance with GAAP applied on a basis consistent with the most recent audited financial statements of Parent delivered to Agent before the Closing Date and using the same inventory valuation method as used in such financial statements, except for any change required or permitted by GAAP if Parent and Borrowers’ certified public accountants concur in such change, the change is disclosed to Agent, and Section 10.3 is amended in a manner that preserves the original intent thereof in light of such change in GAAP. Notwithstanding anything to the contrary set forth herein, any changes to GAAP after the Closing Date with respect to the accounting treatment of leases will not be given effect for the purposes of calculating any financial ratio or definition contained in this Loan Agreement or any other Loan Document.  In addition, notwithstanding any changes in GAAP after the Closing Date, any operating lease of the Borrowers or their Subsidiaries shall not constitute Debt or a Capital Lease under this Loan Agreement or any other Loan Document.
1.3.         Certain Matters of Construction.  The terms “herein,” “hereof,” “hereunder” and other words of similar import refer to this Loan Agreement as a whole and not to any particular section, paragraph or subdivision.  Any pronoun used shall be deemed to cover all genders.  In the computation of periods of time from a specified date to a later specified date, “from” means “from and including,” and “to” and “until” each mean “to but excluding.”  The terms “including” and “include” shall mean “including, without limitation” and, for purposes of each Loan Document, the parties agree that the rule of ejusdem generis shall not be applicable to limit any provision.  Section titles appear as a matter of convenience only and shall not affect the interpretation of any Loan Document.  All references to (a) laws or statutes include all related rules, regulations, interpretations, amendments and successor provisions; (b) any document, instrument or agreement include any amendments, waivers and other modifications, extensions or renewals (to the extent permitted by the Loan Documents); (c) any section means, unless the context otherwise requires, a section of this Loan Agreement; (d) any exhibits or schedules mean, unless the context otherwise requires, exhibits and schedules attached hereto, which are hereby incorporated by reference; (e) any Person include successors and assigns; (f) [reserved]; or (g) discretion
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of Agent, Issuing Bank or any Lender means the sole and absolute discretion of such Person.  All calculations of Value, fundings of Loans, issuances of Letters of Credit and payments of Obligations shall be in Dollars.  Tranche A Borrowing Base, Tranche A-1 Borrowing Base and Tranche A-1 Utilization Amount calculations shall be consistent with historical methods of valuation and calculation, and otherwise reasonably satisfactory to Agent (and not necessarily calculated in accordance with GAAP).  Borrowers shall have the burden of establishing any alleged negligence, misconduct or lack of good faith by Agent, Issuing Bank or any Lender under any Loan Documents.  No provision of any Loan Documents shall be construed against any party by reason of such party having, or being deemed to have, drafted the provision.  Whenever the phrase “to the best of Borrowers’ knowledge” or words of similar import are used in any Loan Documents, it means actual knowledge of a Senior Officer of a Borrower.
1.4.         Letter of Credit Amounts.  Unless otherwise specified herein, the amount of a Letter of Credit at any time shall be deemed to be the stated amount of such Letter of Credit in effect at such time; provided, however, that with respect to any Letter of Credit that by its terms provides for one or more automatic increases in the stated amount thereof, the amount of such Letter of Credit shall be deemed to be the maximum stated amount of such Letter of Credit after giving effect to all such increases, whether or not such maximum stated amount is in effect at such time.
1.5.         Certifications.  All certifications and other statements made by any officer, director or employee of an Obligor pursuant to any Loan Document are and will be made on the behalf of such Obligor and not in such officer’s, director’s or employee’s individual capacity.
1.6.         Times of Day; Rates.  Unless otherwise specified, all references herein to times of day shall be references to Eastern time (daylight or standard, as applicable).  The Agent does not warrant, nor accept responsibility, nor shall the Agent have any liability with respect to the administration, submission or any other matter related to the rates in the definition of “Adjusted LIBOR” or with respect to any comparable or successor rate thereto.
1.7.         Borrowing Notices (CashPro).  The parties agree that any Notice of Borrowing, Notice of Conversion/Continuation, and notice of a Swingline Loan borrowing, shall be made on Borrower Agent’s irrevocable notice, which may be given by (A) telephonic or other e-mailed, electronic or internet-based means in form, in each case, acceptable to the Agent and the Borrower Agent, or (B) a written notice; provided that any telephonic notice must be confirmed promptly by delivery to the Agent of a written notice executed by a Senior Officer or any other officer or employee of the applicable Obligor so designated by any Senior Officer in a notice to the Agent or any other officer or employee of the applicable Obligor designated in or pursuant to an agreement between the applicable Obligor and the Agent.  Any document delivered hereunder that is signed by a Senior Officer of an Obligor shall be conclusively presumed to have been authorized by all necessary corporate, partnership and/or other action on the part of such Obligor and such Senior Officer shall be conclusively presumed to have acted on behalf of such Obligor.
SECTION 2.         CREDIT FACILITIES
2.1.         Commitment.
2.1.1.          Loans.
(a)               Tranche A Revolver Loans.  Each Tranche A Lender agrees, severally on a Pro Rata basis up to its Tranche A Revolver Commitment, on the terms set forth herein, to make Tranche A Revolver Loans to the Borrowers from time to time through the Commitment Termination Date.  The Tranche A Revolver Loans may be repaid and reborrowed as provided herein.  Other than as set forth in Section 2.1.4 and in Section 2.1.5, the Tranche A Lenders shall not have any obligation to honor a
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request for a Tranche A Revolver Loan if (i) after giving effect to the requested Tranche A Revolver Loan, the unpaid balance of Tranche A Revolver Loans outstanding at such time and the aggregate amount of all LC Obligations outstanding at such time (plus the Pre-Petition Tranche A Credit Extensions, if any, outstanding at such time) would exceed the result of (A) the Tranche A Borrowing Base at such time minus (B) the Tranche A-1 Utilization Amount or (ii) after giving effect to the requested Tranche A Revolver Loan, the unpaid balance of all Tranche A Revolver Loans and the aggregate amount of all LC Obligations outstanding at such time (plus the Pre-Petition Tranche A Credit Extensions, if any, outstanding at such time) would exceed the aggregate Tranche A Revolver Commitments at such time.  The calculation of the formula in the immediately preceding sentence shall be subject to the provisions of Section 2.1.10.  Tranche A Revolver Loans shall also be made on a Pro Rata Basis by each Tranche A Lender to fund the Carve Out Account in accordance with the Order.
(b)               Tranche A-1 Revolver Loans.  Subject to the terms set forth herein (including Section 2.1.6(b)), each Tranche A-1 Lender shall be deemed to have made Tranche A-1 Revolver Loans available to the Borrowers on the Closing Date in a principal amount equal to its Tranche A-1 Revolver Commitment.  The Tranche A-1 Revolver Loans that are repaid or prepaid may not be reborrowed.
(c)               Tranche A Borrowing Base, Tranche A-1 Borrowing Base, and Tranche A-1 Utilization Amount.  The Tranche A Borrowing Base, the Tranche A-1 Borrowing Base and the Tranche A-1 Utilization Amount shall be determined from time to time by the Agent by reference to the most recent Borrowing Base Certificate delivered by the Borrowers.  The Agent may from time to time establish and modify the Availability Reserve.
2.1.2.          Evidence of Debt; Notes.
(a)               The Loans made by each Lender and interest accruing thereon shall be evidenced by the records of the Agent and such Lender.  The accounts or records maintained by the Agent and each Lender shall be conclusive absent manifest error of the amount of the Loans made by the Lenders to the Borrowers and the interest and payments thereon.  Any failure to so record or any error in doing so shall not, however, limit or otherwise affect the obligation of the Borrowers hereunder to pay any amount owing with respect to the Obligations.  In the event of any conflict between the accounts and records maintained by any Lender and the accounts and records of the Agent in respect of such matters, the accounts and records of the Agent shall control in the absence of manifest error.  At the request of any Lender (made through the Agent), the Borrowers shall deliver a Tranche A Revolver Note and/or a Tranche A-1 Revolver Note, as applicable, to such Lender.
(b)               In addition to the accounts and records referred to in Section 2.1.2(a), each Lender and the Agent shall maintain in accordance with its usual practice accounts or records evidencing the purchases and sales by such Lender of participations in Letters of Credit and Swingline Loans.  In the event of any conflict between the accounts and records maintained by the Agent and the accounts and records of any Lender in respect of such matters, the accounts and records of the Agent shall control in the absence of manifest error.
2.1.3.          Use of Proceeds.  The proceeds of Loans and the issuance of Letters of Credit shall be used by Borrowers solely on or after the Closing Date, as provided herein and in the Approved Budget (subject to the permitted variances set forth in the covenants in Section 10.1.17(b)) and the Order (a) to fund the Chapter 11 Cases, (b) to pay the Pre-Petition Obligations, including as provided in Section 2.16 and Section 5.5, (c) to finance the Obligors’ working capital, letters of credit and other general corporate needs, including certain fees and expenses of professionals retained by the Obligors, subject to the Carve Out, and (d) to finance other Pre-Petition and pre-filing expenses that are approved by the Bankruptcy Court and permitted by the Approved Budget.  Obligors shall not be permitted to use the proceeds of the Loans, Letters of Credit or any Cash Collateral in contravention of the provisions of the
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Bankruptcy Code or the Order, including any restrictions or limitations on the use of proceeds contained therein.  Nothing in this Loan Agreement, including this Section 2.1.3, shall prohibit the Post-Petition payment of Pre-Petition Obligations, including principal, interest, fees, penalties or recoverable costs, due and payable in connection with the Pre-Petition Loan Agreement with the proceeds of the Collateral (as defined herein) or Collateral (as defined in the Pre-Petition Loan Agreement).
2.1.4.          Overadvances.  If the aggregate Tranche A Revolver Loans and LC Obligations outstanding at any time (plus the Pre-Petition Tranche A Credit Extensions, if any, outstanding at such time) exceed the result of (a) the Tranche A Borrowing Base minus (b) the Tranche A-1 Utilization Amount (“Tranche A Overadvance”) at any time, the excess amount shall be payable by Borrowers on demand by the Agent or the Required Lenders, but all such Tranche A Revolver Loans and LC Obligations shall nevertheless constitute Obligations secured by the Collateral and entitled to all benefits of the Loan Documents.  Unless its authority has been revoked in writing by the Required Lenders, the Agent may require the Tranche A Lenders to honor requests for Overadvance Loans and to forbear from requiring the Borrowers to cure a Tranche A Overadvance so long as, at the time of the making of a Tranche A Overadvance (a) Overadvance Loans have not been outstanding for more than ninety (90) total days in the preceding 365 day period (unless a Liquidation is occurring) and (b) the aggregate amount of all Overadvance Loans and Protective Advances are not known by the Agent to exceed 5% of the Aggregate Borrowing Base at such time.  At no time shall Overadvance Loans be required that would cause the aggregate outstanding amount of all Tranche A Revolver Loans at such time and the aggregate outstanding amount of all LC Obligations at such time (plus the Pre-Petition Tranche A Credit Extensions, if any, outstanding at such time) to exceed the aggregate Tranche A Revolver Commitments at such time.  Any funding of an Overadvance Loan or sufferance of a Tranche A Overadvance shall not constitute a waiver by the Agent or the Lenders of the Event of Default caused thereby.  Overadvance Loans consisting of Loans shall be funded as Base Rate Tranche A Revolver Loans.  In no event shall any Borrower or other Obligor be deemed a beneficiary of this Section nor authorized to enforce any of its terms.  Each Tranche A Lender shall participate in each Overadvance Loan on a Pro Rata basis.  This Section 2.1.4 shall be subject to the provisions of Section 2.1.10.
2.1.5.          Protective Advances.  The Agent shall be authorized, in its discretion, at any time that a Default or Event of Default exists or any conditions in Section 6.2 are not satisfied to make Tranche A Revolver Loans (“Protective Advances”) (so long as at the time of the making of any Protective Advance, Protective Advances which constitute Overadvance Loans have not been outstanding for more than ninety (90) total days in the preceding 365 day period (unless a Liquidation is occurring)) up to an aggregate amount equal to (i) 5% of the Aggregate Borrowing Base at such time minus (ii) the aggregate outstanding principal amount of all Overadvance Loans at such time, if the Agent deems such Loans necessary or desirable to (a) preserve or protect any Collateral, or to enhance the collectability or repayment of the Obligations or the Pre-Petition Obligations; or (b) pay any other amounts chargeable to the Obligors under any Loan Documents, including costs, fees and expenses payable pursuant to Section 3.4 or otherwise.  All Protective Advances shall be Obligations, secured by the Collateral, and shall be treated for all purposes as Extraordinary Expenses.  Protective Advances shall be funded as Base Rate Tranche A Revolver Loans.  Each Tranche A Lender shall participate in each Protective Advance on a Pro Rata basis.  In no event shall Protective Advances be made where the making of such Protective Advances would cause the outstanding Tranche A Revolver Loans and LC Obligations at such time to exceed the Tranche A Revolver Commitments then in effect.  This Section 2.1.5 shall be subject to the provisions of Section 2.1.10.
2.1.6.          Refinancing of Pre-Petition Obligations on the Closing Date.
(a)               Refinancing of Pre-Petition Tranche A Facility.  Notwithstanding anything to the contrary contained in this Loan Agreement or any other Loan Document, on the Closing Date, but subject
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to the Order, the total outstanding amount of the Pre-Petition Obligations owing to the Pre-Petition Tranche A Lenders and their Affiliates shall constitute Obligations under this Loan Agreement in accordance with the Order, with (i) the outstanding amount of all Pre-Petition Tranche A Revolver Loans being refinanced as Tranche A Revolver Loans under this Loan Agreement on the Closing Date, (ii) all accrued interest, expenses, fees (other than the Pre-Petition Tranche A Prepayment Premium) and other sums payable in respect of the Pre-Petition Tranche A Revolver Loans through the Closing Date being paid in cash by the Borrowers to the Agent on the Closing Date, and (iii) the outstanding amount of all Pre-Petition LC Obligations as of the Closing Date, being refinanced and constituting LC Obligations under this Loan Agreement on the Closing Date (including all Existing Letters of Credit issued under the Pre-Petition Loan Agreement being deemed issued under this Loan Agreement on the Closing Date).
(b)               Refinancing of Pre-Petition Tranche A-1 Facility.  Notwithstanding anything to the contrary contained in this Loan Agreement or any other Loan Document, on the Closing Date, but subject to the Order, (i) $25,000,000 in outstanding principal amount of the Pre-Petition Tranche A-1 Revolver Loans (the “Prepaid Pre-Petition Tranche A-1 Revolver Loans”) shall be repaid in cash (on a pro rata basis among the Tranche A-1 Lenders) from the proceeds of Tranche A Revolver Loans which shall be made on the Closing Date under this Loan Agreement, (ii) the remaining outstanding principal amount of the Pre-Petition Tranche A-1 Revolver Loans shall be refinanced as Tranche A-1 Revolver Loans under this Loan Agreement and shall thereafter constitute Obligations under this Loan Agreement in accordance with the Order, (iii) all accrued and unpaid interest, expenses, fees, and other sums (other than the Pre-Petition Specified Tranche A-1 Prepayment Premium (including, for the avoidance of doubt, the portion thereof that would have constituted the Pre-Petition Tranche A-1 Prepayment Premium but for the operation of Section 3.2.5 of the Pre-Petition Loan Agreement)) in respect of the Pre-Petition Tranche A-1 Revolver Loans through the Closing Date shall be paid in cash on the Closing Date.  The Tranche A-1 Revolver Commitments shall be reduced on a dollar-for-dollar basis (resulting in the termination thereof) by the Tranche A-1 Revolver Loans made, or deemed made pursuant to this Loan Agreement.
(c)               Cashless Settlement.  The refinancing of the Pre-Petition Obligations as described in this Section 2.1.6 may be made pursuant to a cashless settlement mechanism approved by the Agent (other than the Prepaid Pre-Petition Tranche A-1 Revolver Loans, which shall be repaid in cash on the Closing Date with the proceeds of Tranche A Revolving Loans as provided in Section 2.1.6(b)).
2.1.7.          Treatment of Pre-Petition Tranche A Prepayment Premium.  On the Closing Date, the Tranche A Revolver Commitments under this Loan Agreement shall be $600,000,000, which  represents a reduction of $130,000,000 from the aggregate amount of the Pre-Petition Tranche A Revolver Commitments (the amount of such reduction, the “Tranche A Revolver Reduction Amount”).  The Tranche A Lenders hereby waive the Pre-Petition Tranche A Prepayment Premium on the Tranche A Revolver Reduction Amount.  On the Closing Date, all amounts in respect of the Pre-Petition Tranche A Prepayment Premium (after giving effect to the waiver thereof with respect to the Tranche A Revolver Reduction Amount) shall, subject to the terms of this Section 2.1.7 and Section 2.1.10, (i) be capitalized to the principal of the Tranche A Revolver Loans and (ii) constitute Obligations under this Loan Agreement in accordance with the Order, but shall be paid to the Tranche A Lenders from proceeds of Collateral as expressly provided in Section 5.5.1 or Section 5.5.2 (as applicable).
2.1.8.          Treatment of Pre-Petition Tranche A-1 Prepayment Premium.  The Tranche A-1 Lenders hereby waive the Pre-Petition Specified Tranche A-1 Prepayment Premium on the Prepaid Pre-Petition Tranche A-1 Revolver Loans.  On the Closing Date, all amounts in respect of the Pre-Petition Specified Tranche A-1 Prepayment Premium (after giving effect to the waiver thereof with respect to the Prepaid Pre-Petition Tranche A-1 Revolver Loans) shall, subject to the terms of this Section 2.1.8 and Section 2.1.10, (i) be capitalized to the principal of the Tranche A-1 Revolver Loans and (ii) constitute Obligations under this Loan Agreement in accordance with the Order, but shall be paid to the Tranche A-
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1 Lenders from proceeds of Collateral as expressly provided in Section 5.5.1 or Section 5.5.2 (as applicable).
2.1.9.          Reduction of Pre-Petition Specified Tranche A-1 Prepayment Premium.  All amounts in respect of the Pre-Petition Specified Tranche A-1 Prepayment Premium (after giving effect to the waiver thereof with respect to the Prepaid Pre-Petition Tranche A-1 Revolver Loans) shall be reduced by any actual cash payments of interest on the Pre-Petition Tranche  A-1 Revolver Loans and the Tranche A-1 Revolver Loans paid by the Borrowers since the date of the Sixth Amendment to the Pre-Petition Loan Agreement (i.e., October 24, 2017), without duplication of the interest subtracted in the calculation of the “Make-Whole Amount” (in accordance with and as defined in the Pre-Petition Loan Agreement), whether such cash payments of interest are made before or after the Petition Date.
2.1.10.          Prepayment Premium Interest Accrual and Availability Calculations. The Pre-Petition Tranche A Prepayment Premium (after giving effect to the waiver thereof with respect to the Tranche A Revolver Reduction Amount) and the Pre-Petition Specified Tranche A-1 Prepayment Premium (after giving effect to the waiver thereof with respect to the Prepaid Pre-Petition Tranche A-1 Revolver Loans) shall be capitalized pursuant to Sections 2.1.7 and 2.1.8, as applicable, but shall not (i) accrue interest (including any interest at the Default Rate, if applicable), (ii) be included in any determination of Excess Availability or the Tranche A-1 Utilization Amount, or (iii) be included in any determination of availability, Commitment usage, or fees due hereunder or pursuant to any Fee Letter, including, without limitation, pursuant to the formulas set forth in Section 2.1.1, Section 2.1.4, Section 2.1.5, Section 3.2.1 or the definition of “LC Conditions”.
2.2.          Voluntary Termination or Reduction of Tranche A Revolver Commitments.
2.2.1.          Termination of Tranche A Revolver Commitments.  The Tranche A Revolver Commitments shall terminate on the Termination Date, unless sooner terminated in accordance with this Loan Agreement.  Upon at least five (5) Business Days prior written notice to Agent at any time, Borrowers may, at their option, terminate the Tranche A Revolver Commitments.  Any notice of termination given by Borrowers shall be irrevocable unless such notice is conditioned upon the effectiveness of other financing arrangements in which case such notice may be revoked if such condition is not satisfied.  On the termination date specified in such notice of termination, Borrowers shall make payment in full, in cash, of Tranche A Revolver Loans and all interest thereon and all Obligations due and owing to the Agent or any Tranche A Lender, in its capacity as a Tranche A Lender.
2.2.2.          Reduction of Tranche A Revolver Commitments.  Borrowers may permanently reduce the Tranche A Revolver Commitments, on a Pro Rata basis for each Tranche A Lender, from time to time upon written notice to Agent, which notice shall specify the amount of the reduction, shall be irrevocable once given unless such notice is conditioned upon the effectiveness of other financing arrangements in which case such notice may be revoked if such condition is not satisfied and shall be given at least five (5) Business Days prior to the requested reduction date.  Each reduction shall be in a minimum amount of $10,000,000, or an increment of $1,000,000 in excess thereof.  In connection with any reduction of the Tranche A Revolver Commitments, the Borrowers shall prepay the Tranche A Revolver Loans and Cash Collateralize Letters of Credit in an amount sufficient to cause the outstanding Tranche A Revolver Loans and Letters of Credit to not exceed the Tranche A Revolver Commitments then in effect.
2.3.         Letter of Credit Facility.
2.3.1.          Issuance of Letters of Credit.  Issuing Bank agrees, in reliance upon the agreements of the Lenders set forth in this Section 2.3, to issue or cause the issuance of Letters of Credit
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from time to time until Letter of Credit Expiration Date (or until the Termination Date, if earlier), on the terms set forth herein, including the following:
(a)               Each Borrower acknowledges that Issuing Bank’s willingness to issue or cause the issuance of any Letter of Credit is conditioned upon Issuing Bank’s receipt of a LC Application with respect to the requested Letter of Credit, as well as such other instruments and agreements as Issuing Bank may customarily require for issuance of a letter of credit of similar type and amount.  Issuing Bank shall have no obligation to issue any Letter of Credit unless (i) Issuing Bank receives a LC Request and LC Application not later than 11:00 a.m. at least three Business Days prior to the requested date of issuance; and (ii) each LC Condition is satisfied.  If Issuing Bank receives written notice from a Tranche A Lender at least one Business Day before issuance of a Letter of Credit that any LC Condition has not been satisfied, Issuing Bank shall have no obligation to issue the requested Letter of Credit (or any other) until such LC Condition is satisfied or until Required Lenders have waived such condition in accordance with this Loan Agreement.  Prior to receipt of any such notice, Issuing Bank shall not be deemed to have knowledge of any failure of LC Conditions.  No Issuing Bank shall be under any obligation to issue any Letter of Credit if (i) any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain such Issuing Bank from issuing such Letter of Credit, or any law applicable to such Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over such Issuing Bank shall prohibit, or request that such Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon such Issuing Bank with respect to such Letter of Credit any restriction, reserve or capital requirement (for which such Issuing Bank is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon such Issuing Bank any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which such Issuing Bank in good faith deems material to it, (ii) the issuance of such Letter of Credit would violate one or more policies of such Issuing Bank applicable to letters of credit generally or (iii) any Lender is at such time a Defaulting Lender, unless such Issuing Bank has entered into arrangements satisfactory to such Issuing Bank with the Borrowers or such Defaulting Lender to eliminate such Issuing Bank’s Fronting Exposure with respect to such Defaulting Lender.
(b)               Letters of Credit may be requested by a Borrower only (i) to support obligations of such Borrower incurred in the Ordinary Course of Business; or (ii) for other purposes as Agent and Lenders may approve from time to time in writing.  The renewal or extension of any Letter of Credit shall be treated as the issuance of a new Letter of Credit, except that delivery of a new LC Application shall be required at the discretion of Issuing Bank.
(c)               Borrowers assume all risks of the acts, omissions or misuses of any Letter of Credit by the beneficiary.  In connection with issuance of any Letter of Credit, none of Agent, Issuing Bank or any Lender shall be responsible for the existence, character, quality, quantity, condition, packing, value or delivery of any goods purported to be represented by any Documents; any differences or variation in the character, quality, quantity, condition, packing, value or delivery of any goods from that expressed in any Documents; the form, validity, sufficiency, accuracy, genuineness or legal effect of any Documents or of any endorsements thereon; the time, place, manner or order in which shipment of goods is made; partial or incomplete shipment of, or failure to ship, any goods referred to in a Letter of Credit or Documents; any deviation from instructions, delay, default or fraud by any shipper or other Person in connection with any goods, shipment or delivery; any breach of contract between a shipper or vendor and a Borrower; errors, omissions, interruptions or delays in transmission or delivery of any messages, by mail, cable, telegraph, telex, telecopy, e-mail, telephone or otherwise; errors in interpretation of technical terms; the misapplication by a beneficiary of any Letter of Credit or the proceeds thereof; or any consequences arising from causes beyond the control of Issuing Bank, Agent or any Lender, including any act or omission of a Governmental Authority.  The rights and remedies of Issuing Bank under the
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Loan Documents shall be cumulative.  Issuing Bank shall be fully subrogated to the rights and remedies of each beneficiary whose claims against Borrowers are discharged with proceeds of any Letter of Credit.
(d)               In connection with its administration of and enforcement of rights or remedies under any Letters of Credit or LC Documents, Issuing Bank shall be entitled to act, and shall be fully protected in acting, upon any certification, notice or other communication in whatever form believed by Issuing Bank, in good faith, to be genuine and correct and to have been signed, sent or made by a proper Person.  Issuing Bank may consult with and employ legal counsel, accountants and other experts to advise it concerning its obligations, rights and remedies, and shall be entitled to act upon, and shall be fully protected in any action taken in good faith reliance upon, any advice given by such experts.  Issuing Bank may employ agents and attorneys-in-fact in connection with any matter relating to Letters of Credit or LC Documents, and shall not be liable for the negligence or misconduct of any such agents or attorneys-in-fact selected with reasonable care.
(e)               Agent shall have no obligation to approve any request for a commercial Letter of Credit for the purchase of finished goods unless each of the following documents are required as conditions to any draw thereon, and for such commercial Letter of Credit to constitute an Eligible Trade L/C, such documents being in the possession of Agent (either directly or through its agent) must be conditions to any draw thereon (except that Agent may waive any one or more of the following conditions):
(i)                the original Eligible Trade L/C, if only one draw is permitted thereunder or if multiple draws are permitted and the subject draw is the final draw thereunder;
(ii)               an inspection certificate in form reasonably acceptable to Agent, in its discretion, executed by a Borrower’s employee or agent at the point of origin of the finished goods;
(iii)              a commercial invoice with respect to the purchase order(s) against which such finished goods are being delivered and a packaging list with respect to such goods;
(iv)              a non-negotiable ocean bill of lading, freight forwarders cargo receipt, a house bill of lading or a copy of an airway bill of lading issued by an Approved Shipper with respect to the finished goods being shipped and providing for the delivery thereof to a Borrower; and
(v)               a certificate of origin or other documents of title with respect to such Inventory.
(f)                [reserved].
(g)               Promptly after receipt of any LC Application, the Issuing Bank will confirm with the Agent (by telephone or in writing) that the Agent has received a copy of such LC Application from the Borrowers and, if not, the Issuing Bank will, upon the request of the Agent, provide the Agent with a copy thereof.  Subject to the requirements of subsection (j) below, unless the Issuing Bank has received written notice from any Lender, the Agent or any Borrower, at least one Business Day prior to the requested date of issuance or amendment of the applicable Letter of Credit, that one or more applicable conditions contained in Section 6 shall not then be satisfied, then, subject to the terms and conditions hereof, the Issuing Bank shall, on the requested date, issue a Letter of Credit for the account of the Borrowers.
(h)               The obligation of the Borrowers to reimburse the Issuing Bank for each drawing under each Letter of Credit and to repay each borrowing under each Letter of Credit shall be absolute, unconditional and irrevocable, and shall be paid strictly in accordance with the terms of this Loan Agreement under all circumstances, including the following: (i) any lack of validity or enforceability of
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such Letter of Credit, this Loan Agreement, or any other Loan Document; (ii) the existence of any claim, counterclaim, setoff, defense or other right that any Borrower or any Subsidiary may have at any time against any beneficiary or any transferee of such Letter of Credit (or any Person for whom any such beneficiary or any such transferee may be acting), the Issuing Bank or any other Person, whether in connection with this Loan Agreement, the transactions contemplated hereby or by such Letter of Credit or any agreement or instrument relating thereto, or any unrelated transaction; (iii) any draft, demand, certificate or other document presented under such Letter of Credit proving to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or any loss or delay in the transmission or otherwise of any document required in order to make a drawing under such Letter of Credit; (iv) any payment by the Issuing Bank under such Letter of Credit against presentation of a draft or certificate that does not strictly comply with the terms of such Letter of Credit; or any payment made by the Issuing Bank under such Letter of Credit to any Person purporting to be a trustee in bankruptcy, debtor-in-possession, assignee for the benefit of creditors, liquidator, receiver or other representative of or successor to any beneficiary or any transferee of such Letter of Credit; or (v) any other circumstance or happening whatsoever, whether or not similar to any of the foregoing, including any other circumstance that might otherwise constitute a defense available to, or a discharge of, any Borrower or any Subsidiary.
(i)               The Borrowers shall promptly examine a copy of each Letter of Credit and each amendment thereto that is delivered to it and, in the event of any claim of noncompliance with the Borrowers’ instructions or other irregularity, the Borrowers will immediately notify the Issuing Bank.  The Borrowers shall be conclusively deemed to have waived any such claim against the Issuing Bank and its correspondents unless such notice is given as aforesaid.
(j)               Each Issuing Bank shall, before the issuance of any Letter of Credit, notify the Agent in writing of the issuance of each Letter of Credit hereunder and, upon the request of the Agent, provide the Agent with a copy of any such Letter of Credit (it being understood that such Issuing Bank may update the Agent one time during a Business Day with respect to all relevant Letters of Credit).  A failure of any Issuing Bank (other than Bank of America) to comply with the requirements of this clause (j) in respect any Letter of Credit may, as determined by the Agent in its sole discretion, cause the LC Obligations in respect of such Letter of Credit to be excluded from the Obligations.
2.3.2.          Reimbursement; Participations.
(a)               If Issuing Bank honors any request for payment under a Letter of Credit or, if applicable a LC Guaranty with respect to a Letter of Credit, Borrowers shall pay to Issuing Bank, on the same day (“Reimbursement Date”), the amount paid by Issuing Bank under such Letter of Credit or, if applicable, under a LC Guaranty with respect to such Letter of Credit, together with interest at the interest rate for Base Rate Tranche A Revolver Loans from the Reimbursement Date until payment by Borrowers.  The obligation of Borrowers to reimburse Issuing Bank for any payment made under a Letter of Credit or LC Guaranty shall be absolute, unconditional, irrevocable, and joint and several, and shall be paid without regard to any lack of validity or enforceability of any Letter of Credit or the existence of any claim, setoff, defense or other right that Borrowers may have at any time against the beneficiary.  Whether or not Borrower Agent submits a Notice of Borrowing, Borrowers shall be deemed to have requested a Borrowing of Base Rate Tranche A Revolver Loans in an amount necessary to pay all amounts due Issuing Bank on any Reimbursement Date and each Tranche A Lender agrees to fund its Pro Rata share of such Borrowing whether or not the Tranche A Revolver Commitments have terminated, a Tranche A Overadvance exists or is created thereby, or the conditions in Section 6 are satisfied.
(b)               Upon issuance of a Letter of Credit, each Tranche A Lender shall be deemed to have irrevocably and unconditionally purchased from Issuing Bank, without recourse or warranty, an
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undivided Pro Rata interest and participation in all LC Obligations relating to the Letter of Credit.  If Issuing Bank makes any payment under a Letter of Credit or a LC Guaranty and Borrowers do not reimburse such payment on the Reimbursement Date, Agent shall promptly notify Lenders and each Tranche A Lender shall promptly (within one Business Day) and unconditionally pay to Agent, for the benefit of Issuing Bank, such Tranche A Lender’s Pro Rata share of such payment.  Upon request by a Tranche A Lender, Issuing Bank shall furnish copies of any Letters of Credit and LC Documents in its possession at such time.
(c)               The obligation of each Tranche A Lender to make payments to Agent for the account of Issuing Bank in connection with Issuing Bank’s payment under a Letter of Credit or LC Guaranty shall be absolute, unconditional and irrevocable, not subject to any counterclaim, setoff, qualification or exception whatsoever, and shall be made in accordance with this Loan Agreement under all circumstances, irrespective of any lack of validity or unenforceability of any Loan Documents; any draft, certificate or other document presented under a Letter of Credit having been determined to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; or the existence of any setoff or defense that any Obligor may have with respect to any Obligations.  Issuing Bank does not assume any responsibility for any failure or delay in performance or any breach by any Borrower or other Person of any obligations under any LC Documents.  Issuing Bank does not make to Lenders any express or implied warranty, representation or guaranty with respect to the Collateral, LC Documents or any Obligor.  Issuing Bank shall not be responsible to any Lender for any recitals, statements, information, representations or warranties contained in, or for the execution, validity, genuineness, effectiveness or enforceability of any LC Documents; the validity, genuineness, enforceability, collectability, value or sufficiency of any Collateral or the perfection of any Lien therein; or the assets, liabilities, financial condition, results of operations, business, creditworthiness or legal status of any Obligor.
(d)               If any Lender fails to make available to the Agent for the account of the Issuing Bank any amount required to be paid by such Lender pursuant to the foregoing provisions of this Section 2.3 by the time specified in this Section 2.3, the Issuing Bank shall be entitled to recover from such Lender (acting through the Agent), on demand, such amount with interest thereon for the period from the date such payment is required to the date on which such payment is immediately available to the Issuing Bank at a rate per annum equal to the greater of the Federal Funds Rate and a rate determined by the Issuing Bank in accordance with banking industry rules on interbank compensation, plus any administrative, processing or similar fees customarily charged by the Issuing Bank in connection with the foregoing.  If such Lender pays such amount (with interest and fees as aforesaid), the amount so paid shall constitute such Lender’s required payment by such Lender pursuant to the foregoing provisions of this Section 2.3.  A certificate of the Issuing Bank submitted to any Lender (through the Agent) with respect to any amounts owing under this Section 2.3 shall be conclusive absent manifest error.
(e)               No Issuing Bank Indemnitee shall be liable to any Lender or other Person for any action taken or omitted to be taken in connection with any LC Documents except as a result of its actual gross negligence or willful misconduct.  Issuing Bank shall not have any liability to any Lender if Issuing Bank refrains from any action under any Letter of Credit or LC Documents until it receives written instructions from Required Lenders.
2.3.3.          Cash Collateral.
(a)               Certain Credit Support Events.  If any LC Obligations, whether or not then due or payable, shall for any reason be outstanding at any time (a) that an Event of Default exists, (b) that Excess Availability is less than zero, (c) after the date on which the Tranche A Revolver Commitment has been terminated, or (d) after the Letter of Credit Expiration Date, then Borrowers shall, at Issuing Bank’s or
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Agent’s request, pay to Issuing Bank the amount of all outstanding LC Obligations and Cash Collateralize or backstop in a manner agreed to by the Borrower Agent and the Issuing Bank, all outstanding Letters of Credit.  If Borrowers fail to Cash Collateralize or backstop outstanding Letters of Credit as required herein, Tranche A Lenders may (and shall upon direction of Agent) advance, as Base Rate Tranche A Revolver Loans, the amount of the Cash Collateral required (whether or not the Commitments have terminated, any Tranche A Overadvance exists, or the conditions in Section 6 are satisfied).  At any time that there shall exist a Defaulting Lender, promptly upon the reasonable request of the Agent (including with respect to Swingline Loans) or the Issuing Bank, the Borrowers shall deliver to the Agent from time to time Cash Collateral in an amount sufficient to cover all Fronting Exposure (after giving effect to Section 4.2 and any Cash Collateral provided by the Defaulting Lender).  Cash Collateral provided in respect of Letters of Credit or Swingline Loans shall be held and applied to the satisfaction of the specific LC Obligations, Swingline Loans, obligations to fund participations therein (including, as to Cash Collateral provided by a Defaulting Lender, any interest accrued on such obligation) and other obligations for which the Cash Collateral was so provided, prior to any other application of such property as may be provided for herein.  Each Borrower, and to the extent provided by any Defaulting Lender, such Lender, hereby grants to (and subjects to the control of) the Agent, for the benefit of the Agent, the Issuing Bank and the Lenders, and agrees to maintain, a first priority security interest in all such cash, deposit accounts and all balances therein, and all other property so provided as collateral pursuant hereto, and in all proceeds of the foregoing, all as security for the obligations to which such Cash Collateral may be applied.
(b)               Grant of Security Interest.  Any Cash Collateral may be invested, in Agent’s discretion, in Cash Equivalents, but Agent shall have no duty to do so, regardless of any agreement, understanding or course of dealing with any Obligor, and shall have no responsibility for any investment or loss.  Each Obligor hereby grants to Agent, for the benefit of Secured Parties, a security interest in all Cash Collateral held from time to time and all proceeds thereof, as security for the Obligations, whether such Cash Collateral is held in the Cash Collateral Account or elsewhere.  Agent may apply Cash Collateral to the payment of any Obligations, in accordance with Section 5.5 and the Order, as they become due and payable.  The Cash Collateral Account and all Cash Collateral shall be under the sole dominion and control of Agent.  No Obligor or other Person claiming through or on behalf of any Obligor shall have any right to any Cash Collateral, until payment in full, in cash of all Obligations and the occurrence of the Commitment Termination Date.
2.3.4.          Role of Issuing Bank.  Each Lender and each Borrower agree that, in paying any drawing under a Letter of Credit, the Issuing Bank shall not have any responsibility to obtain any document (other than any sight draft, certificates and documents expressly required by the Letter of Credit) or to ascertain or inquire as to the validity or accuracy of any such document or the authority of the Person executing or delivering any such document.  None of the Issuing Bank, the Agent, any of their respective Related Parties nor any correspondent, participant or assignee of the Issuing Bank shall be liable to any Lender for (i) any action taken or omitted in connection herewith at the request or with the approval of the Lenders or the Required Lenders, as applicable; (ii) any action taken or omitted in the absence of gross negligence or willful misconduct; or (iii) the due execution, effectiveness, validity or enforceability of any document or instrument related to any Letter of Credit or document in connection therewith.  None of the Issuing Bank, the Agent, any of their respective Related Parties nor any correspondent, participant or assignee of the Issuing Bank shall be liable or responsible for any of the matters described in clauses (i) through (v) of Section 2.3.1(h); provided, however, that anything in such clauses to the contrary notwithstanding, the Borrowers may have a claim against the Issuing Bank, and the Issuing Bank may be liable to the Borrowers, to the extent, but only to the extent, of any direct, as opposed to consequential or exemplary, damages suffered by the Borrowers which the Borrowers prove were caused by the Issuing Bank’s bad faith, willful misconduct or gross negligence or the Issuing Bank’s failure to pay under any Letter of Credit after the presentation to it by the beneficiary of a sight draft and
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certificate(s) strictly complying with the terms and conditions of a Letter of Credit.  In furtherance and not in limitation of the foregoing, the Issuing Bank may accept documents that appear on their face to be in order, without responsibility for further investigation, regardless of any notice or information to the contrary, and the Issuing Bank shall not be responsible for the validity or sufficiency of any instrument transferring or assigning or purporting to transfer or assign a Letter of Credit or the rights or benefits thereunder or proceeds thereof, in whole or in part, which may prove to be invalid or ineffective for any reason.  The Issuing Bank may send a Letter of Credit or conduct any communication to or from the beneficiary via the Society for Worldwide Interbank Financial Telecommunication (“SWIFT”) message or overnight courier, or any other commercially reasonable means of communicating with a beneficiary.
2.3.5.          Applicability of ISP and UCP; Limitation of Liability.  Unless otherwise expressly agreed by the Issuing Bank and the Borrowers when a Letter of Credit is issued(i) the rules of the ISP shall apply to each standby Letter of Credit, and (ii) the rules of the UCP shall apply to each documentary Letter of Credit.  Notwithstanding the foregoing, the Issuing Bank shall not be responsible to the Borrowers for, and the Issuing Bank’s rights and remedies against the Borrowers shall not be impaired by, any action or inaction of the Issuing Bank required or permitted under any law, order, or practice that is required or permitted to be applied to any Letter of Credit or this Loan Agreement, including the law or any order of a jurisdiction where the Issuing Bank or the beneficiary is located, the practice stated in the ISP or UCP, as applicable, or in the decisions, opinions, practice statements, or official commentary of the ICC Banking Commission, the Bankers Association for Finance and Trade - International Financial Services Association (BAFT-IFSA), or the Institute of International Banking Law & Practice, whether or not any Letter of Credit chooses such law or practice.
2.3.6.          Existing Letters of Credit.  On and as of the Closing Date, all letters of credit issued for the account of the Obligors under the Pre-Petition Loan Agreement (the “Existing Letters of Credit”), which Existing Letters of Credit are described on Schedule 2.3.6, shall be deemed to be issued as Letters of Credit under this Loan Agreement.
SECTION 3.         INTEREST, FEES AND CHARGES
3.1.         Interest.
3.1.1.          Rates and Payment of Interest.
(a)               Interest Rates Generally.  The Obligations shall bear interest (i) if a Base Rate Tranche A Revolver Loan, at the Base Rate in effect from time to time, plus the Applicable Margin for Base Rate Tranche A Revolver Loans; (ii) if a Base Rate Tranche A-1 Revolver Loan, at the Base Rate in effect from time to time, plus the Applicable Margin for Base Rate Tranche A-1 Revolver Loans; (iii) if a LIBOR Tranche A Revolver Loan, at Adjusted LIBOR for the applicable Interest Period, plus the Applicable Margin for LIBOR Tranche A Revolver Loans; and (iv) if a LIBOR Tranche A-1 Revolver Loan, at Adjusted LIBOR for the applicable Interest Period, plus the Applicable Margin for LIBOR Tranche A-1 Revolver Loans.  Interest shall accrue from the date the Loan is advanced or the Obligation is incurred or payable, until paid by Borrowers.  If a Loan is repaid on the same day made, one day’s interest shall accrue.  Notwithstanding the foregoing, if the Agent cannot determine or use Adjusted LIBOR as provided in Sections 3.1.4, 3.5 or 3.6, Obligations in respect of all Tranche A-1 Revolver Loans shall accrue interest at a rate per annum equal to the Base Rate (determined without reference to the Adjusted LIBOR component of the Base Rate), plus the Applicable Margin for Base Rate Tranche A-1 Revolver Loans.
(b)               Default Rate.  During the occurrence and continuance of any Event of Default, at the election of the Agent or the Required Lenders, Obligations owing to the Tranche A Lenders shall bear interest at the Default Rate applicable to such Obligations.  During the occurrence and continuance of any
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Event of Default, at the election of the Agent or the Required Tranche A-1 Lenders, Obligations owing to the Tranche A-1 Lenders shall bear interest at the Default Rate applicable to such Obligations. Each Borrower acknowledges that the cost, expense and risk to the Agent and each Lender due to an Event of Default are difficult to ascertain and that the Default Rate is a fair and reasonable estimate to compensate the Agent and the Lenders for such added cost, expense and risk.
(c)               Interest Payment Dates.  Interest accrued on the Loans shall be due and payable in arrears, (i) with respect to each Base Rate Tranche A Revolver Loan, on the first Business Day of each month; (ii) with respect to each Base Rate Tranche A-l Revolver Loan, on the first Business Day of each month; (iii) with respect to each LIBOR Tranche A Revolver Loan, on the last day of its Interest Period; (iv) with respect to each LIBOR Tranche A-1 Revolver Loan, on the last day of its Interest Period; (v) on any date of prepayment, with respect to the principal amount of Loans being prepaid; (vi) with respect to any voluntary termination or reduction of the Tranche A Revolver Commitments, on the date of such termination or reduction with respect to the principal amount of Tranche A Revolver Loans where the commitment to make such Tranche A Revolver Loans is being terminated and (vii) on the Termination Date.  If any Interest Period for a LIBOR Loan exceeds three months, interest accrued on such LIBOR Loan shall also be due and payable on the respective dates that fall every three months after the beginning of such Interest Period.  Interest accrued on any other Obligations shall be due and payable as provided in the Loan Documents and, if no payment date is specified, shall be due and payable on demand.  Notwithstanding the foregoing, interest accrued at the Default Rate shall be due and payable on demand.
3.1.2.          Application of Adjusted LIBOR to Outstanding Loans.
(a)               Borrowers may on any Business Day, subject to delivery of a Notice of Conversion/Continuation, elect to convert any portion of the Base Rate Tranche A Revolver Loans to, or to continue any LIBOR Tranche A Revolver Loan at the end of its Interest Period as, a LIBOR Tranche A Revolver Loan.  The Borrowers may on any Business Day, subject to delivery of a Notice of Conversion/Continuation, elect to convert any portion of the Base Rate Tranche A-1 Revolver Loans to a LIBOR Tranche A-1 Revolver Loan.  During the occurrence and continuance of any Default or Event of Default, the Agent may (and shall at the direction of Required Lenders) declare that no Loan may be made, converted or continued, as applicable, as a LIBOR Tranche A Revolver Loan or a LIBOR Tranche A-1 Revolver Loan, as applicable.
(b)               Whenever Borrowers desire to convert or continue Loans as LIBOR Loans, the Borrower Agent shall give the Agent a Notice of Conversion/Continuation, no later than 11:00 a.m. at least three (3) Business Days before the requested conversion or continuation date.  Promptly after receiving any such notice, the Agent shall notify each Tranche A Lender or Tranche A-1 Lender, as applicable, thereof.  Each Notice of Conversion/Continuation shall be irrevocable, and shall specify the aggregate principal amount of Loans to be converted or continued, the conversion or continuation date (which shall be a Business Day), and the duration of the Interest Period (which shall be deemed to be one month in the case of Tranche A Revolver Loans if not specified).  If, upon the expiration of any Interest Period in respect of any LIBOR Tranche A Revolver Loans, the Borrowers shall have failed to deliver a Notice of Conversion/Continuation, they shall be deemed to have elected to convert such Loans into Base Rate Tranche A Revolver Loans.  For the avoidance of doubt, LIBOR Tranche A-1 Revolver Loans shall automatically continue as such Type without the need for the Borrower Agent to deliver a Notice of Conversion/Continuation.
3.1.3.          Interest Periods.  The term “Interest Period” means, as to each LIBOR Loan, the period commencing on the date such LIBOR Loan is disbursed or converted to or continued as a LIBOR Loan and ending on the date one month thereafter; provided that:
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(a)               any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless, in the case of a LIBOR Loan, such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day;
(b)               any Interest Period pertaining to a LIBOR Loan that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of the calendar month at the end of such Interest Period; and
(c)               no Interest Period shall extend beyond the Termination Date.
3.1.4.          Interest Rate Not Ascertainable.
(a)               Subject to Section 3.1.4(c), if in connection with any request for a LIBOR Loan or a conversion to or continuation thereof, (i)  the Agent determines that (A) Dollar deposits are not being offered to banks in the London interbank  market for the applicable amount and Interest Period of such LIBOR Loan, or (B) adequate and reasonable means do not exist for determining Adjusted LIBOR for any requested Interest Period with respect to a proposed LIBOR Loan or in connection with an existing or proposed Base Rate Loan (in each case with respect to clause (a)(i) above, “Impacted Loans”), or (b) the Agent or the Required Lenders determine that for any reason Adjusted LIBOR for any requested Interest Period with respect to a proposed LIBOR Loan does not adequately and fairly reflect the cost to such Lenders of funding such LIBOR Loan, the Agent will promptly so notify the Borrower Agent and each Lender and, in the case of clause (b) above, the Required Lenders shall deliver a certificate to the Borrower Agent setting forth the basis on which such Lenders have determined that the Adjusted LIBOR for the applicable Interest Period does not adequately and fairly reflect the cost to such Lenders of funding such proposed LIBOR Loan and certifying that such Lenders’ determination is not inconsistent with their treatment of borrowers generally.  Thereafter, (x) the obligation of the Lenders to make or maintain LIBOR Loans shall be suspended (to the extent of the affected LIBOR Loans or Interest Periods), and (y) in the event of a determination described in the preceding sentence with respect to the Adjusted LIBOR component of the Base Rate, the utilization of the Adjusted LIBOR component in determining the Base Rate shall be suspended, in each case until the Agent (upon the instruction of the Required Lenders) revokes such notice.  Upon receipt of such notice, the Borrowers may revoke any pending request for a Borrowing of, conversion to or continuation of LIBOR Loans (to the extent of the affected LIBOR Loans or Interest Periods) or, failing that, will be deemed to have converted such request into a request for a Borrowing of Base Rate Loans in the amount specified therein.
(b)               Notwithstanding the foregoing, if the Agent has made the determination described in clause (a)(i) of this Section, the Agent, in consultation with the Borrowers and the affected Lenders, may establish an alternative interest rate for the Impacted Loans, in which case, such alternative rate of interest shall apply with respect to the Impacted Loans until (1) the Agent revokes the notice delivered with respect to the Impacted Loans under clause (a) of the first sentence of this Section, (2) the Agent or the Required Lenders notify the Agent and the Borrowers that such alternative interest rate does not adequately and fairly reflect the cost to such Lenders of funding the Impacted Loans, or (3) any Lender determines that any Applicable Law has made it unlawful, or that any Governmental Authority has asserted that it is unlawful, for such Lender or its applicable Lending Office to make, maintain or fund Loans whose interest is determined by reference to such alternative rate of interest or to determine or charge interest rates based upon such rate or any Governmental Authority has imposed material restrictions on the authority of such Lender to do any of the foregoing and provides the Agent and the Borrowers written notice thereof.
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(c)               Notwithstanding anything to the contrary in this Loan Agreement or any other Loan Documents, if the Agent determines (which determination shall be conclusive absent manifest error), or the Borrowers or the Required Lenders notify the Agent (with, in the case of the Required Lenders, a copy to Borrowers) that the Borrowers or the Required Lenders (as applicable) have determined, that:
(i)                adequate and reasonable means do not exist for ascertaining LIBOR for any requested Interest Period, including, without limitation, because the LIBOR Screen Rate is not available or published on a current basis and such circumstances are unlikely to be temporary; or
(ii)               the administrator of the LIBOR Screen Rate or a Governmental Authority having jurisdiction over the Agent has made a public statement identifying a specific date after which LIBOR or the LIBOR Screen Rate shall no longer be made available, or used for determining the interest rate of loans (such specific date, the “Scheduled Unavailability Date”), or
(iii)              syndicated loans currently being executed, or that include language similar to that contained in this Section, are being executed or amended (as applicable) to incorporate or adopt a new benchmark interest rate to replace LIBOR,
then, reasonably promptly after such determination by the Agent or receipt by the Agent of such notice , as applicable, the Agent and the Borrowers may amend this Loan Agreement to replace LIBOR with an alternate benchmark rate (including any mathematical or other adjustments to the benchmark (if any) incorporated therein), giving due consideration to any evolving or then existing convention for similar U.S. dollar denominated syndicated credit facilities for such alternative benchmarks (any such proposed rate, a “LIBOR Successor Rate”), together with any proposed LIBOR Successor Rate Conforming Changes and any such amendment shall become effective at 5:00 p.m. (New York time) on the fifth Business Day after the Agent shall have posted such proposed amendment to the Lenders and the Borrowers unless, prior to such time, Lenders comprising the Required Lenders have delivered to the Agent written notice that such Required Lenders do not accept such amendment.
If no LIBOR Successor Rate has been determined and the circumstances under clause (i) above exist or the Scheduled Unavailability Date has occurred (as applicable), the Agent will promptly so notify the Borrowers and each Lender.  Thereafter, (x) the obligation of the Lenders to make or maintain LIBOR Loans shall be suspended, (to the extent of the affected LIBOR Loans or Interest Periods), and (y) the LIBOR component shall no longer be utilized in determining the Base Rate.  Upon receipt of such notice, the Borrowers may revoke any pending request for a Borrowing of, conversion to or continuation of LIBOR Loans (to the extent of the affected LIBOR Loans or Interest Periods) or, failing that, will be deemed to have converted such request into a request for a Borrowing of Base Rate Loans (subject to the foregoing clause (y)) in the amount specified therein.
Notwithstanding anything else herein, any definition of LIBOR Successor Rate shall provide that in no event shall such LIBOR Successor Rate be less than zero for purposes of this Loan Agreement.
3.2.         Fees.
3.2.1.          Unused Line Fee.  Borrowers shall pay to the Agent for the Pro Rata benefit of the Tranche A Lenders, a fee equal to Unused Line Fee Rate times the amount by which the Tranche A Revolver Commitments exceed the average daily principal balance of Tranche A Revolver Loans and stated amount of Letters of Credit during any month.  The fees payable under this Section 3.2.1 shall be payable in arrears, on the first Business Day of each month and on the Commitment Termination Date.
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3.2.2.          LC Facility Fees.  Borrowers shall pay (a) to the Agent, for the Pro Rata benefit of the Tranche A Lenders, a fee equal to the Applicable Margin in effect for LIBOR Tranche A Revolver Loans times the average daily stated amount of Letters of Credit, which fee shall be payable monthly in arrears, on the first Business Day of each month; provided, however, that any such fee otherwise payable for the account of a Defaulting Lender with respect to any Letter of Credit as to which such Defaulting Lender has not provided Cash Collateral satisfactory to the Issuing Bank shall be payable, to the maximum extent permitted by Applicable Law, to the other Tranche A Lenders in accordance with the upward adjustments in their respective Pro Rata shares allocable to such Letter of Credit pursuant to Section 4.2, with the balance of such fee, if any, payable to the Issuing Bank for its own account; (b) to each Issuing Bank, a fronting fee in an amount required by such Issuing Bank, for the account of such Issuing Bank, with respect to each Letter of Credit issued by such Issuing Bank, which fee shall be payable upon issuance of the Letter of Credit and on each anniversary date of such issuance, and shall be payable on any increase in stated amount made between any such dates; and (c) to Issuing Bank, for its own account, all customary charges associated with the issuance, amending, negotiating, payment, processing, transfer and administration of Letters of Credit, which charges shall be paid as and when incurred (collectively, the “LC Facility Fees”).  During the occurrence and continuance of an Event of Default, at the election of the Agent or the Required Lenders, the fee payable under clause (a) above shall be increased by 2% per annum.
3.2.3.          Fee LettersThe Borrowers shall pay to the applicable Persons, for their own respective accounts, the fees set forth in the Fee Letters in the amounts and at the times specified in the Fee Letters. Such fees shall be fully earned when paid and shall not be refundable for any reason whatsoever.
3.2.4.          Payment of Fees Generally.  All fees shall be paid on the dates due, in immediately available funds, to the Agent for the account of the Agent and other Secured Parties as provided herein, provided that the fees payable to any Joint Lead Arranger pursuant to Section 3.2.3 and to the applicable Issuing Banks pursuant to Section 3.2.2 may be paid directly to the Persons entitled thereto. Once due, all fees shall be fully earned and, once paid, shall not be refundable under any circumstances.
3.3.         Computation of Interest, Fees, Yield Protection.  All computations of interest for Base Rate Loans shall be made on the basis of a year of 365 or 366 days, as the case may be, and actual days elapsed.  All other computation of interest, as well as fees and other charges calculated on a per annum basis, shall be computed for the actual days elapsed, based on a year of 360 days.  Each determination by Agent of any interest, fees or interest rate hereunder shall be final, conclusive and binding for all purposes, absent error.  All fees shall be fully earned when due and shall not be subject to rebate or refund, nor subject to proration except as specifically provided herein.  All fees payable under Section 3.2 are compensation for services and are not, and shall not be deemed to be, interest or any other charge for the use, forbearance or detention of money.  A certificate as to amounts payable by Borrowers under Section 3.4, 3.6, 3.7, 3.9 or 5.8, submitted to Borrowers by the Agent or the affected Lender, as applicable, shall be final, conclusive and binding for all purposes, absent error.
3.4.         Reimbursement Obligations.
3.4.1.          Generally.  Borrowers shall reimburse the Agent and each Co-Collateral Agent for all Extraordinary Expenses.  Borrowers shall also reimburse the Agent for all reasonable and documented legal fees of any outside counsel (including local counsel) and accounting, appraisal, consulting and other reasonable and documented fees, out-of-pocket costs and expenses incurred by it in connection with (a) syndication, negotiation and preparation of any Loan Documents, including any amendment or other modification thereof; (b) administration of and actions relating to any Collateral,
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Loan Documents, and transactions contemplated thereby, including any actions taken to perfect or maintain priority of Agent’s Liens on any Collateral, to maintain any insurance required hereunder or to verify Collateral; and (c) each inspection, audit or appraisal with respect to any Obligor or Collateral, whether prepared by Agent’s personnel or a third party.  Borrowers shall also reimburse Lenders for all costs and expenses incurred by them (but limited to legal fees of one outside counsel for all Lenders, one local counsel in each relevant jurisdiction (as determined by the Lenders in their reasonable discretion), one special or regulatory counsel in respect of each matter (as reasonably required by the Lenders) and one conflict of interest counsel (as determined by any Lender in its reasonable discretion)) during the occurrence and continuance of an Event of Default in connection with the enforcement or preservation of any rights under this Loan Agreement or any of the other Loan Documents.  Borrowers shall also reimburse each Co-Collateral Agent for all reasonable and documented legal fees of one primary outside counsel (and one local counsel in each relevant jurisdiction) incurred by it in connection with (a) syndication, negotiation and preparation of any Loan Documents, including any amendment, waiver, consent, supplement, restatement or other modification thereof or thereto; and (b) administration and enforcement of and actions relating to any Collateral, Loan Documents, and transactions contemplated thereby. Borrowers shall also reimburse the Tranche A-1 Documentation Agent for all reasonable and documented legal fees of one primary outside counsel (and one local counsel in each relevant jurisdiction) incurred by it on behalf of the Tranche A-1 Lenders.  For the avoidance of doubt and subject to the limitations set forth above with respect to fees outside counsel, the Borrowers shall reimburse the Agent, each Co-Collateral Agent, and the Tranche A-1 Documentation Agent for all reasonable and documented legal, accounting, appraisal, consulting, and other fees, costs and expenses incurred in connection with the negotiation, preparation and administration of the Loan Documents, the Interim Order, and the Final Order and incurred in connection with:
(a)               amendment, modification or waiver of, consent with respect to, or termination of, any of the Loan Documents or advice in connection with the syndication and administration of the Loans made pursuant hereto or its rights hereunder or thereunder;
(b)               any litigation, contest, dispute, suit, proceeding or action (whether instituted by the Agent, any Co-Collateral Agent, the Tranche A-1 Documentation Agent, any Lender, the Borrower or any other Person and whether as a party, witness or otherwise) in any way relating to the Collateral, any of the Loan Documents or any other agreement to be executed or delivered in connection herewith or therewith, including any litigation, contest, dispute, suit, case, proceeding or action, and any appeal or review thereof, in connection with a case or proceeding commenced by or against any Borrower or any other Person that may be obligated to the Agent by virtue of the Loan Documents; including any such litigation, contest, dispute, suit, proceeding or action arising in connection with any work-out or restructuring of the Loans during the pendency of one or more Events of Default; provided that no Person shall be entitled to reimbursement under this clause (b) in respect of any litigation, contest, dispute, suit, proceeding or action to the extent any of the foregoing results from such Person’s gross negligence or willful misconduct (as determined by a final non-appealable judgment);
(c)               any attempt to enforce or prosecute any rights or remedies of the Agent against any or all of the Obligors or any other Person that may be obligated to the Agent or any Lender by virtue of any of the Loan Documents, including any such attempt to enforce any such remedies in the course of any work-out or restructuring of the Loans during the pendency of one or more Events of Default;
(d)               any work-out or restructuring of the Loans during the pendency of one or more Events of Default;
(e)               the obtaining of approval of the Loan Documents by the Bankruptcy Court;
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(f)               the preparation and review of pleadings, documents and reports related to the Chapter 11 Cases and any Successor Cases, attendance at meetings, court hearings or conferences related to the Chapter 11 Cases and any Successor Cases, and general monitoring of the Chapter 11 Cases and any Successor Cases;
(g)               efforts of the Agent to (i) monitor the Loans or any of the other Obligations, (ii) evaluate, observe or assess any of the Obligors or their respective affairs, and (iii) verify, protect, evaluate, assess, appraise, collect, sell, liquidate or otherwise dispose of any of the Collateral;
(h)               any lien searches or request for information listing financing statements or liens filed or searches conducted to confirm receipt and due filing of financing statements and security interests in all or a portion of the Collateral; and
(i)               including, as to each of clauses (a) through (h) above, all reasonable attorneys’  fees of the reimburse the Agent, each Co-Collateral Agent, the Tranche A-1 Documentation Agent (subject to the limitations set forth above) and the Agent’s other professional and service providers’ fees arising from such services and other advice, assistance or other representation, including those in connection with any appellate proceedings, and all reasonable expenses, costs, charges and other fees incurred by such counsel and others in connection with or relating to any of the events or actions described in this Section 3.4.1, all of which shall be payable, on demand, by the Borrowers to the Agent, any Co-Collateral Agent or the Tranche A-1 Documentation Agent.  Without limiting the generality of the foregoing, such reasonable expenses, costs, charges and fees may include: reasonable fees, costs and expenses of accountants, sales consultants, financial advisors, any Agent’s Advisor, environmental advisors, appraisers, investment bankers, management and other consultants and paralegals; court costs and expenses; photocopying and duplication expenses; court reporter fees, costs and expenses; air express charges; and reasonable expenses for travel, lodging and food paid or incurred in connection with the performance of such legal or other advisory services.
3.4.2.          Agent’s Advisors.  The Agent, on behalf of itself and the Lenders, shall be entitled to retain (either directly or through counsel) any financial advisor, auditor or any other consultant the Agent may deem necessary (collectively, the “Agent’s Advisors”) to provide advice, analysis and reporting for the benefit of the Agent and the Lenders.  The Obligors and their advisors shall grant access to, and cooperate in all respects with, the Agent, the Lenders, the Agent’s Advisors and any other representatives of the foregoing and provide all information that such parties may reasonably request in a timely manner.  The Borrowers shall promptly pay upon demand all fees and expenses of each Agent’s Advisors, and all such fees and expenses shall constitute Obligations and be secured by the Collateral.  The Obligors further acknowledge and agree that each Agent’s Advisor and each of their Related Parties shall constitute an Indemnitee for purposes of Section 14.2 hereof.
3.4.3.          Fees and Expenses as Obligations.  All amounts reimbursable by the Borrowers under this Section 3.4 shall constitute Obligations secured by the Collateral and shall be payable on demand to the Borrowers therefor, subject to the Order, by any of the Agent, any Co-Collateral Agent, or the Tranche A-1 Documentation Agent.
3.5.         Illegality.  Notwithstanding anything to the contrary herein, if (a) any change in any law or interpretation thereof made after the date hereof, by any Governmental Authority makes it unlawful for a Lender to make or maintain a LIBOR Loan or to maintain any Commitment with respect to LIBOR Loans or (b) a Lender determines that the making or continuance of a LIBOR Loan has become impracticable as a result of a circumstance that adversely affects the London interbank market or the position of such Lender in such market, then such Lender shall give notice thereof to Agent and Borrowers and may (i) declare that LIBOR Loans will not thereafter be made by such Lender, whereupon if such Lender is a Tranche A Lender any request for a LIBOR Tranche A Revolver Loan from such
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Lender shall be deemed to be a request for a Base Rate Tranche A Revolver Loan unless such Lender’s declaration has been withdrawn (and it shall be withdrawn promptly upon cessation of the circumstances described in clause (a) or (b) above); and/or (ii) (x) where such Lender is a Tranche A Lender, require that all outstanding LIBOR Tranche A Revolver Loans made by such Lender be converted to Base Rate Tranche A Revolver Loans immediately, in which event all outstanding LIBOR Tranche A Revolver Loans of such Lender shall be immediately converted to Base Rate Tranche A Revolver Loans and (y) where such Lender is a Tranche A-1 Lender, require that all outstanding LIBOR Tranche A-1 Revolver Loans made by such Lender be converted to Base Rate Tranche A-1 Revolver Loans immediately, in which event all outstanding LIBOR Tranche A-1 Revolver Loans of such Lender shall be immediately converted to Base Rate Tranche A-1 Revolver Loans, with the interest rate calculated as provided in Section 3.1.1(a).  If any such notice asserts the illegality of such Lender determining or charging interest rates based upon Adjusted LIBOR, the Agent shall during the period of such suspension compute the Base Rate applicable to such Lender without reference to the Adjusted LIBOR component thereof until the Agent is advised in writing by such Lender that it is no longer illegal for such Lender to determine or charge interest rates based upon Adjusted LIBOR.  Upon any such prepayment or conversion, the Borrowers shall also pay accrued interest on the amount so prepaid or converted.  Notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act, and all requests, regulations, rules, guidelines and directives promulgated thereunder and (y) all requests, rules, guidelines or directives promulgated by the Bank for International settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States regulatory authorities, in each case pursuant to Basel III, shall, in each case, be deemed to have been adopted after the date hereof, regardless of the date enacted, adopted or issued.
3.6.         Increased Costs.  If, by reason of (a) the introduction of or any change (including any change by way of imposition or increase of Statutory Reserves or other reserve requirements) in any law or interpretation thereof, in each case made after the date hereof, or (b) the compliance with any guideline or request from any Governmental Authority or other Person exercising control over banks or financial institutions generally (whether or not having the force of law), promulgated after the date hereof:
(i)               any Recipient shall be subject to any Taxes with respect to any LIBOR Loan or Letter of Credit or its obligation to make LIBOR Loans, issue Letters of Credit or participate in LC Obligations or its deposits, reserves, other liabilities or capital attributable thereto, or a change shall result in the basis of taxation of any payment to any Recipient with respect to its LIBOR Loans or its obligation to make LIBOR Loans, issue Letters of Credit or participate in LC Obligations (other than (x) Indemnified Taxes, (y) Taxes described in clauses (b) through (d) of the definition of Excluded Taxes and (z) Connection Income Taxes and subject to Section 5.8); or
(ii)               any reserve (including any imposed by the Board of Governors), special deposits or similar requirement against assets of, deposits with or for the account of, or credit extended by, any Recipient shall be imposed or deemed applicable, or any other condition affecting any Recipient’s LIBOR Loans or obligation to make LIBOR Loans, issue Letters of Credit or participate in LC Obligations shall be imposed on such Recipient or the London interbank market;
and as a result there shall be a material increase in the cost to such Lender of agreeing to make or making, funding or maintaining LIBOR Loans, Letters of Credit or participations in LC Obligations (except to the extent already included in determination of Adjusted LIBOR), or there shall be a reduction in the amount receivable by such Lender, then the Lender shall promptly notify Borrowers and Agent of such event, and Borrowers shall, within five (5) Business Days following demand therefor, pay such Lender the amount of such increased costs or reduced amounts; provided, however, that such Lender shall repay to
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Borrowers any amounts paid by Borrowers to such Lender under this Section 3.6 at any time such Lender shall determine that such change or compliance was not applicable to, or required by, such Lender.
If a Lender determines that, because of circumstances described above or any other circumstances arising hereafter affecting such Lender, the London interbank market or the Lender’s position in such market, Adjusted LIBOR or its Applicable Margin, as applicable, will not adequately and fairly reflect the cost to such Lender of funding or maintaining LIBOR Loans, issuing Letters of Credit or participating in LC Obligations, then (A) the Lender shall promptly notify Borrowers and Agent of such event; (B) such Lender’s obligation to make or maintain LIBOR Loans, issue Letters of Credit or participate in LC Obligations shall be immediately suspended, until each condition giving rise to such suspension no longer exists; and (C) (x) where such Lender is a Tranche A Lender such Lender shall make a Base Rate Tranche A Revolver Loan as part of any requested Borrowing of LIBOR Tranche A Revolver Loans, which Base Rate Tranche A Revolver Loan shall, for all purposes, be considered part of such Borrowing and (y) where such Lender is a Tranche A-1 Lender, such Lender’s outstanding Tranche A-1 Revolver Loans shall bear interest as if such Loans are Base Rate Tranche A-1 Revolver Loans, with the interest rate calculated as provided in Section 3.1.1(a).
Within fifteen (15) days after receipt by the Borrower Agent of written notice and/or demand from any Lender (an “Affected Lender”) (i) stating that, pursuant to Section 3.5, that such Lender can no longer make LIBOR Loans or (ii) demanding payment of additional amounts or increased costs pursuant to Section 3.6, Borrower Agent may, at its option, notify the Agent and such Affected Lender of its intention to replace the Affected Lender.  So long as no Default or Event of Default shall have occurred and be continuing, the Borrower Agent may obtain, at the Borrowers’ expense, a replacement Lender (“Replacement Lender”) for the Affected Lender, which Replacement Lender must be an Eligible Assignee.  If the Borrowers obtain a Replacement Lender within ninety (90) days following notice of their intention to do so, the Affected Lender must sell and assign its Loans and Commitments to such Replacement Lender for an amount equal to the principal balance of all Loans held by the Affected Lender and all accrued interest and fees with respect thereto through the date of such sale; provided that the Borrowers shall have reimbursed such Affected Lender for the additional amounts or increased costs that it is entitled to receive under this Loan Agreement through the date of such sale and assignment.  Notwithstanding the foregoing, the Borrowers shall not have the right to obtain a Replacement Lender if the Affected Lender (i) in the case of a notice under Section 3.5, rescinds its notice that it can no longer fund LIBOR Loans or (ii) in the case of a demand under Section 3.6, rescinds its demand for increased costs or additional amounts, within fifteen (15) days following its receipt of the Borrower Agent’s notice of intention to replace such Affected Lender.  Furthermore, if the Borrower Agent gives a notice of intention to replace and do not so replace such Affected Lender within ninety (90) days thereafter, the Borrowers’ rights under this paragraph as to such noticed replacement shall terminate.
3.7.         Capital Adequacy.  If a Lender determines that any introduction of or any change in a Capital Adequacy Regulation, any change in the interpretation or administration of a Capital Adequacy Regulation by a Governmental Authority charged with interpretation or administration thereof, or any compliance by such Lender or any Person controlling such Lender with a Capital Adequacy Regulation, in each case made after the date hereof, increases the amount of capital required or expected to be maintained by such Lender or Person (taking into consideration its capital adequacy policies and desired return on capital) as a consequence of such Lender’s Commitments, Loans, participations in LC Obligations or other obligations under the Loan Documents, then Borrowers shall, within five (5) Business Days following demand therefor, pay such Lender an amount sufficient to compensate for such increase.  A Lender’s demand for payment shall set forth the nature of the occurrence giving rise to such compensation and a calculation of the amount to be paid.  In determining such amount, the Lender may use any reasonable averaging and attribution method.
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3.8.         Mitigation.  Each Lender agrees that, upon becoming aware that it is subject to Section 3.5, 3.6, 3.7 or 5.8, it will take reasonable measures to reduce Borrowers’ obligations under such Sections, including funding or maintaining its Commitments or Loans through another Lender Office, as long as use of such measures would not adversely affect the Lender’s Commitments, Loans, business or interests, and would not be inconsistent with any applicable legal or regulatory restriction.
3.9.         Funding Losses.  If for any reason (other than default by a Lender) (a) any Borrowing of, or conversion to or continuation of, a LIBOR Loan does not occur on the date specified therefor in a Notice of Borrowing or Notice of Conversion/Continuation (whether or not withdrawn), (b) any repayment or conversion of a LIBOR Loan occurs on a day other than the end of its Interest Period, or (c) Borrowers fail to repay a LIBOR Loan when required hereunder, then Borrowers shall pay to Agent its customary administrative charge and to each Lender all losses and expenses that it sustains as a consequence thereof, including any loss or expense arising from liquidation or redeployment of funds or from fees payable to terminate deposits of matching funds, but excluding any loss of profits in connection therewith.  Lenders shall not be required to purchase Dollar deposits in the London interbank market or any other offshore Dollar market to fund any LIBOR Loan, but the provisions hereof shall be deemed to apply as if each Lender had purchased such deposits to fund its LIBOR Loans.
3.10.        Maximum Interest.  In no event shall interest, charges or other amounts that are contracted for, charged or received by the Agent and Lenders pursuant to any Loan Documents and that are deemed interest under Applicable Law (“interest”) exceed the highest rate permissible under Applicable Law (“maximum rate”).  If, in any month, any interest rate, absent the foregoing limitation, would have exceeded the maximum rate, then the interest rate for that month shall be the maximum rate and, if in a future month, that interest rate would otherwise be less than the maximum rate, then the rate shall remain at the maximum rate until the amount of interest actually paid equals the amount of interest which would have accrued if it had not been limited by the maximum rate.  If, upon payment in full, in cash, of the Obligations, the total amount of interest actually paid under the Loan Documents is less than the total amount of interest that would, but for this Section 3.10, have accrued under the Loan Documents, then the Borrowers shall, to the extent permitted by Applicable Law, pay to the Agent, for the account of Lenders, (a) the lesser of (i) the amount of interest that would have been charged if the maximum rate had been in effect at all times, or (ii) the amount of interest that would have accrued had the interest rate otherwise set forth in the Loan Documents been in effect, minus (b) the amount of interest actually paid under the Loan Documents.  If a court of competent jurisdiction determines that the Agent or any Lender has received interest in excess of the maximum amount allowed under Applicable Law, such excess shall be deemed received on account of, and shall automatically be applied to reduce, Obligations other than interest (regardless of any erroneous application thereof by the Agent or any Lender), and upon payment in full, in cash of the Obligations, any balance shall be refunded to Borrowers.  In determining whether any excess interest has been charged or received by Agent or any Lender, all interest at any time charged or received from the Borrowers in connection with the Loan Documents shall, to the extent permitted by Applicable Law, be amortized, prorated, allocated and spread in equal parts throughout the full term of the Obligations.
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SECTION 4.         LOAN ADMINISTRATION
4.1.         Manner of Borrowing and Funding Loans.
4.1.1.          Notice of Borrowing.
(a)               Whenever Borrowers desire funding of a Borrowing of Loans, Borrower Agent shall give Agent a Notice of Borrowing.  Such notice must be received by Agent no later than 12:00 noon (i) on the Business Day of the requested funding date, in the case of Base Rate Loans, and (ii) at least three Business Days prior to the requested funding date, in the case of LIBOR Loans.  Notices received after 12:00 noon shall be deemed received on the next Business Day.  Each Notice of Borrowing shall be irrevocable and shall specify (A) the principal amount of the Borrowing, (B) the requested funding date (which must be a Business Day and, in the case of Tranche A-1 Revolver Loans, must be the Closing Date), (C) whether the Borrowing is to be made as Base Rate Tranche A Revolver Loans, Base Rate Tranche A-1 Revolver Loans, LIBOR Tranche A Revolver Loans or LIBOR Tranche A-1 Revolver Loans, and (D) in the case of LIBOR Loans, the duration of the applicable Interest Period (which shall be deemed to be one month in the case of Tranche A Revolver Loans if not specified).
(b)               Unless payment is otherwise timely made by Borrowers, the becoming due of any Obligations (whether principal, interest (including, to the extent permitted by law, interest not paid when due), fees or other charges, including Extraordinary Expenses, LC Obligations, Cash Collateral and Bank Product Debt) shall be deemed to be a request for Base Rate Tranche A Revolver Loans on the due date, in the amount of such Obligations.
(c)               If Borrowers establish a controlled disbursement account with Agent or any Affiliate of Agent, then the presentation for payment of any check or other item of payment drawn on such account at a time when there are insufficient funds to cover it shall be deemed to be, on the date of such presentation, in the amount of the check and items presented for payment, a request for Tranche A Revolver Loans.  The proceeds of such Loans may be disbursed directly to the controlled disbursement account or other appropriate account.
4.1.2.          Fundings by Lenders.  Each Tranche A Lender shall timely honor its Tranche A Revolver Commitment by funding its Pro Rata share of each Borrowing of Tranche A Revolver Loans that is properly requested hereunder and each Tranche A-1 Lender shall timely honor its Tranche A-1 Revolver Commitment by funding its Pro Rata share of each Borrowing of Tranche A-1 Revolver Loans that is properly requested hereunder.  Except for Borrowings to be made as Swingline Loans, Agent shall endeavor to notify Lenders of each Notice of Borrowing (or deemed request for a Borrowing) by 12:00 noon on the proposed funding date for Base Rate Loans or by 3:00 p.m. at least three Business Days before any proposed funding of LIBOR Loans.  Each Lender shall fund to Agent such Lender’s Pro Rata share of the Borrowing to the account specified by Agent in immediately available funds not later than 2:00 p.m. on the requested funding date, unless Agent’s notice is received after the times provided above, in which event Lender shall fund its Pro Rata share by 11:00 a.m. on the next Business Day.  Subject to its receipt of such amounts from Lenders, Agent shall disburse the proceeds of the Loans as directed by Borrower Agent.  Unless Agent shall have received (in sufficient time to act) written notice from a Lender that it does not intend to fund its Pro Rata share of a Borrowing, Agent may assume that such Lender has deposited or promptly will deposit its share with Agent, and Agent may disburse a corresponding amount to Borrowers.  If a Lender’s share of any Borrowing is not in fact received by Agent, then Borrowers agree to repay to Agent on demand the amount of such share, together with interest thereon from the date disbursed until repaid, at the rate applicable to such Borrowing.  If any Lender makes available to the Agent funds for any Loan to be made by such Lender as provided in this Loan Agreement, and such funds are not made available to the Borrowers by the Agent because the conditions to the applicable credit
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extension set forth in Section 6 are not satisfied or waived in accordance with the terms hereof, the Agent shall return such funds (in like funds as received from such Lender) to such Lender, without interest.
4.1.3.          Swingline Loans; Settlement.
(a)               In reliance upon the agreements of the other Lenders set forth in this Section 4.1.3, Agent may, in its sole and absolute discretion (unless Agent has knowledge that the conditions set forth in Section 6.2 have not been met), advance Swingline Loans to Borrowers out of Agent’s own funds, up to an aggregate outstanding amount of $75,000,000, unless the funding is specifically required to be made by all Lenders hereunder.  Each Swingline Loan shall constitute a Base Rate Tranche A Revolver Loan for all purposes, except that payments thereon shall be made to Agent for its own account.  The obligation of Borrowers to repay Swingline Loans shall be evidenced by the records of Agent and need not be evidenced by any promissory note.  If the Agent shall elect not to fund a requested Swingline Loan for any reason, the Agent shall notify the Borrower Agent of such election after the receipt of the borrowing notice in respect of such Swingline Loan.
(b)               To facilitate administration of the Loans, Tranche A Lenders and Agent agree (which agreement is solely among them, and not for the benefit of or enforceable by any Borrower) that settlement among them with respect to Swingline Loans and other Tranche A Revolver Loans may take place periodically on a date determined from time to time by Agent, which shall occur at least once every week.  On each settlement date, settlement shall be made with each Lender in accordance with the Settlement Report delivered by Agent to Tranche A Lenders.  Between settlement dates, Agent may in its discretion apply payments on Loans to Swingline Loans, regardless of any designation by Borrower or any provision herein to the contrary.  Each Tranche A Lender’s obligation to make settlements with Agent is absolute and unconditional, without offset, counterclaim or other defense, and whether or not the Tranche A Revolver Commitments have terminated, a Tranche A Overadvance exists, or the conditions in Section 6 are satisfied.  If, due to an Insolvency Proceeding with respect to a Borrower or otherwise, any Swingline Loan may not be settled among Tranche A Lenders hereunder, then each Tranche A Lender shall be deemed to have purchased from Agent a Pro Rata participation in each unpaid Swingline Loan and shall transfer the amount of such participation to Agent, in immediately available funds, within one Business Day after Agent’s request therefor.
4.1.4.          Notices.  Each Borrower authorizes Agent and Lenders to extend, convert or continue Loans, effect selections of interest rates, and transfer funds to or on behalf of Borrowers based on telephonic or other e-mailed, electronic or internet-based instructions in form, in each case, acceptable to the Agent and the Borrower Agent.  Borrower Agent shall confirm each such request by prompt delivery to Agent of a Notice of Borrowing or Notice of Conversion/Continuation, if applicable, but if it differs in any material respect from the action taken by Agent or Lenders, the records of Agent and Lenders shall govern.  Neither Agent nor any Lender shall have any liability for any loss suffered by a Borrower as a result of Agent or any Lender acting upon its understanding of telephonic or other e-mailed, electronic or internet-based instructions in form, in each case, reasonably acceptable to the Agent and the Borrowers, from a person believed in good faith by Agent or any Lender to be a person authorized to give such instructions on a Borrower’s behalf.
4.2.         Defaulting Lender.
4.2.1.          Reallocation of Payments.  Any payment of principal, interest, fees or other amounts received by the Agent for the account of a Defaulting Lender (whether voluntary or mandatory, at maturity, pursuant to Section 11 or otherwise, or received by the Agent from a Defaulting Lender pursuant to Section 11.4), shall be applied at such time or times as may be determined by the Agent as follows: first, to the payment of any amounts owing by such Defaulting Lender to the Agent hereunder; second, to the payment on a pro rata basis of any amounts owing by such Defaulting Lender to the Issuing
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Banks and Agent in its capacity as provider of Swingline Loans hereunder; third, to Cash Collateralize the Issuing Banks’ Fronting Exposure with respect to such Defaulting Lender in accordance with Section 2.3.3; fourth, (a) if no Default or Event of Default then exists or would result therefrom, to the funding of any Loan in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Loan Agreement or (b), otherwise, to the prepayment of Loans funded by other Lenders pursuant to any Notice of Borrowing which was not honored by such Defaulting Lender; fifth, if so determined by the Agent or (so long as no Event of Default exists) the Borrower, to be held in a deposit account and released pro rata in order to (x) satisfy such Defaulting Lender’s potential future funding obligations with respect to Loans under this Loan Agreement and (y) Cash Collateralize the Issuing Banks’ future Fronting Exposure with respect to such Defaulting Lender with respect to future Letters of Credit issued under this Loan Agreement, in accordance with Section 2.3.3; sixth, to the payment of any amounts owing to the Lenders, the Issuing Banks or the Agent, in its capacity as provider of Swingline Loans, as a result of any judgment of a court of competent jurisdiction obtained by any Lender, the Issuing Banks or the Agent, in its capacity as provider of Swingline Loans, against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Loan Agreement; seventh, so long as no Default or Event of Default exists, to the payment of any amounts owing to the Borrower as a result of any judgment of a court of competent jurisdiction obtained by the Borrower against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Loan Agreement; and eighth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if (x) such payment is a payment of the principal amount of any Loans or LC Obligations in respect of which such Defaulting Lender has not fully funded its appropriate share and (y) such Loans were made or the related Letters of Credit were issued at a time when the conditions set forth in Section 6.2 were satisfied or waived, such payment shall be applied solely to pay the Loans of, and LC Obligations owed to, all non-Defaulting Lenders on a pro rata basis prior to being applied to the payment of any Loans of, or LC Obligations owed to, such Defaulting Lender until such time as all Loans and funded and unfunded participations in LC Obligations and Swingline Loans are held by the Lenders pro rata in accordance with the Commitments hereunder without giving effect to Section 4.2.1(b) below.  Any payments, prepayments or other amounts paid or payable to a Defaulting Lender that are applied (or held) to pay amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this Section 4.2.1 shall be deemed paid to and redirected by such Defaulting Lender, and each Lender irrevocably consents hereto.
(a)               Certain Fees.  Such Defaulting Lender (x) shall not be entitled to receive any unused line fee pursuant to Section 3.2.1 for any period during which that Lender is a Defaulting Lender (and the Borrowers shall not be required to pay any such fee that otherwise would have been required to have been paid to that Defaulting Lender) and (y) shall be limited in its right to receive LC Facility Fees as provided in Section 3.2.2(a).
(b)               Reallocation of Pro Rata Shares to Reduce Fronting Exposure. During any period in which there is a Defaulting Lender, for purposes of computing the amount of the obligation of each non-Defaulting Lender to acquire, refinance or fund participations in Letters of Credit or Swingline Loans pursuant to Section 3.2.2(a) or Section 4.1, the “Pro Rata” share or participation of each non-Defaulting Lender shall be computed without giving effect to the Tranche A Revolver Commitment of that Defaulting Lender; provided that, (i) each such reallocation shall be given effect only if, at the date the applicable Lender becomes a Defaulting Lender, no Default or Event of Default exists; and (ii) the aggregate obligation of each non-Defaulting Tranche A Lender to acquire, refinance or fund participations in Letters of Credit and Swingline Loans shall not exceed the positive difference, if any, of (1) the Tranche A Revolver Commitment of that non-Defaulting Lender minus (2) the aggregate outstanding amount of the Tranche A Revolver Loans of that Lender.  Subject to Section 14.21, no reallocation hereunder shall constitute a waiver or release of any claim of any party hereunder against a Defaulting Lender arising from that Lender having become a Defaulting Lender, including any claim of a
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non-Defaulting Lender as a result of such non-Defaulting Lender’s increased exposure following such reallocation.
(c)               Waivers and Amendments.  Such Defaulting Lender’s right to approve or disapprove any amendment, waiver or consent with respect to this Loan Agreement shall be restricted as set forth in Section 14.1.1.
4.2.2.          Defaulting Lender Cure.  If the Borrowers, the Agent, and the Issuing Banks agree in writing that a Lender is no longer a Defaulting Lender, the Agent will so notify the parties hereto, whereupon as of the effective date specified in such notice and subject to any conditions set forth therein (which may include arrangements with respect to any Cash Collateral), that Lender will, to the extent applicable, purchase at par that portion of outstanding Loans of the other Lenders or take such other actions as the Agent may determine to be necessary to cause the Loans and funded and unfunded participations in Letters of Credit and Swingline Loans to be held on a Pro Rata basis by the Lenders in accordance with their respective Pro Rata shares (without giving effect to Section 4.2.2(b)), whereupon such Lender will cease to be a Defaulting Lender; provided that no adjustments will be made retroactively with respect to fees accrued or payments made by or on behalf of the Borrower while that Lender was a Defaulting Lender; and provided, further, that except to the extent otherwise expressly agreed by the affected parties, no change hereunder from Defaulting Lender to Lender will constitute a waiver or release of any claim of any party hereunder arising from that Lender’s having been a Defaulting Lender.
4.3.         Number and Minimum Amount of LIBOR Loans; Determination of Rate.  For ease of administration, all LIBOR Loans having the same length and beginning date of their Interest Periods shall be aggregated together, and such Loans shall be allocated among Tranche A Lenders or Tranche A-1 Lenders on a Pro Rata basis.  For the avoidance of doubt, all Tranche A-1 Revolver Loans shall have the same Interest Period.  Each aggregate LIBOR Loan when made, continued or converted shall be in a minimum amount of $10,000,000, or an increment of $1,000,000 in excess thereof.  No more than ten (10) LIBOR Loans, in the aggregate, may be outstanding at any time.  Upon determining Adjusted LIBOR for any Interest Period requested by Borrower Agent, the Agent shall promptly notify Borrowers thereof by telephone or electronically and, if requested by the Borrower Agent, shall confirm any telephonic notice in writing.
4.4.         Borrower Agent.  Each Borrower hereby designates Bon-Ton (“Borrower Agent”) as its representative and agent for all purposes under the Loan Documents, including requests for Loans and Letters of Credit, designation of interest rates, delivery or receipt of communications with Agent, Issuing Bank or any Lender, preparation and delivery of Borrowing Base Certificates and financial reports, receipt and payment of Obligations, requests for waivers, amendments or other accommodations, actions under the Loan Documents (including in respect of compliance with covenants), and all other dealings with Agent, Issuing Bank or any Lender.  Borrower Agent hereby accepts such appointment.  Agent and Lenders shall be entitled to rely upon, and shall be fully protected in relying upon, any notice or communication (including any notice of borrowing) delivered by Borrower Agent on behalf of any Borrower.  Agent and Lenders may give any notice or communication with a Borrower hereunder to Borrower Agent on behalf of such Borrower.  Agent shall have the right, in its discretion, to deal exclusively with Borrower Agent for any or all purposes under the Loan Documents.  Each Borrower agrees that any notice, election, communication, representation, agreement or undertaking made on its behalf by Borrower Agent shall be binding upon and enforceable against it.  Any notice, certificate or other communication under this Loan Agreement or any other Loan Document that is required, permitted or contemplated to be delivered by a Borrower or the Borrowers may instead be delivered by the Borrower Agent.
4.5.         Reserved.
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4.6.         Effect of Termination.  On the effective date of any termination of the Commitments, all Obligations shall be immediately due and payable, and any Lender may terminate its and its Affiliates’ Bank Products (including, with the consent of Agent, any Cash Management Services).  All undertakings of Borrowers contained in the Loan Documents shall survive any termination, and Agent shall retain its Liens in the Collateral and all of its rights and remedies under the Loan Documents until the occurrence of payment in full, in cash, of all accrued and unpaid principal, interest and fees, and any other Obligations then due and owing, the payment of any appropriate collateral deposits in connection with other Obligations and the occurrence of the Commitment Termination Date.  Notwithstanding such payment in full, in cash, of all accrued and unpaid principal, interest and fees, and any other Obligations then due and owing, the payment of any appropriate collateral deposits in connection with other Obligations and the occurrence of the Commitment Termination Date, the Agent shall not be required to terminate its Liens in any Collateral unless, with respect to any damages the Agent may incur as a result of the dishonor or return of Payment Items applied to Obligations, the Agent receives (a) a written agreement, executed by Borrowers and any Person whose advances are used in whole or in part to satisfy the Obligations, indemnifying the Agent and Lenders from any such damages; or (b) such Cash Collateral as the Agent, in its discretion, deems reasonably necessary to protect against any such damages.  The provisions of Sections 2.3, 3.4, 3.6, 3.7, 3.9, 5.4, 5.8, 12, and 14.2, and the obligation of each Obligor and Lender with respect to each indemnity given by it in any Loan Document, shall survive Full Payment of the Obligations and any release relating to this credit facility.
SECTION 5.         PAYMENTS
5.1.         General Payment Provisions.  All payments of Obligations shall be made in Dollars, without condition, deduction, offset, counterclaim or defense of any kind, free and clear of (and without deduction for) any Taxes, and in immediately available funds, not later than 2:00 p.m. on the due date.  Any payment after such time shall be deemed made on the next Business Day.  The Borrowers may, at the time of payment, specify to the Agent the Obligations to which such payment is to be applied, but the Agent shall in all events retain the right to apply such payment in such manner as the Agent, subject to the provisions hereof (including, without limitation, Section 5.5), may determine to be appropriate.  If any payment under the Loan Documents shall be stated to be due on a day other than a Business Day, the due date shall be extended to the next Business Day and such extension of time shall be included in any computation of interest and fees.  Each payment of Loans shall be accompanied by the payment of accrued interest to the date of such payment on the amount repaid or prepaid, any payment of a LIBOR Loan prior to the end of its Interest Period shall be accompanied by all amounts due under Section 3.9.  Any prepayment of the Tranche A Revolver Loans shall be applied first to Base Rate Tranche A Revolver Loans and then to LIBOR Tranche A Revolver Loans.  Any prepayment of the Tranche A-1 Revolver Loans shall be applied first to Base Rate Tranche A-1 Revolver Loans and then to LIBOR Tranche A-1 Revolver Loans.  For the avoidance of any doubt, all payments of principal, interest, fees or other amounts owing to the Tranche A-1 Lenders shall be made to the Agent for application to the Tranche A-1 Revolver Loans in accordance with the terms of this Loan Agreement.  Unless the Agent shall have received notice from the Borrower Agent prior to the time at which any payment is due to the Agent for the account of the Lenders or the Issuing Bank hereunder that the Borrowers will not make such payment, the Agent may assume that the Borrowers have made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the case may be, the amount due.  In such event, if the Borrowers have not in fact made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Agent forthwith on demand the amount so distributed to such Lender or the Issuing Bank, in immediately available funds with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Agent, at the greater of the Federal Funds Rate and a rate determined by the Agent in accordance with banking industry rules on interbank compensation.  Any payments of
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Loans shall be made in accordance with the terms of this Loan Agreement, including Sections 5.1, 5.2 and 5.5.
5.2.         Repayment of Loans.
5.2.1.          Voluntary Prepayments of Loans.
(a)               Voluntary Prepayments of Tranche A Revolver Loans.  Borrowers may, upon notice from Borrower Agent to Agent, prepay the Tranche A Revolver Loans in whole or in part without premium or penalty, on a Pro Rata basis for each Tranche A Lender.  Any such notice must be in a form acceptable to Agent and received by Agent not later than 12:00 p.m. on the date of prepayment of Tranche A Revolver Loans.  Any such notice shall specify the date and amount of such prepayment and the Type(s) of Tranche A Revolver Loans to be prepaid and, if LIBOR Tranche A Revolver Loans are to be prepaid, the Interest Period(s) of such Loans, and shall be irrevocable once given unless such notice is conditioned upon the effectiveness of other financing arrangements in which case such notice may be revoked if such condition is not satisfied.  Agent will promptly notify each Lender of its receipt of each such notice, and of the amount of such Lender’s Pro Rata share of such prepayment.
(b)               No Voluntary Prepayments of Tranche A-1 Revolver Loans.  The principal amount of the Tranche A-1 Revolver Loans (and the Pre-Petition Tranche A-1 Revolver Loans, if any) may not be voluntarily prepaid or repaid prior to the Termination Date (it being understood that the prepayment of the Prepaid Pre-Petition Tranche A-1 Revolver Loans and the refinancing of the Pre-Petition Tranche A-1 Loans, in each case, in accordance with Section 2.1.6 shall not be deemed to violate this Section 5.2.1(b)) if any Tranche A Revolver Loans or Tranche A Revolver Commitments remain outstanding.
5.2.2.          Mandatory Prepayments.
(a)               Asset Dispositions and Insurance Proceeds.  Subject to the terms of the Order, the Obligations, and, to the extent provided therefor in Section 5.5, the Pre-Petition Obligations, shall be prepaid promptly after the consummation of any Asset Disposition (other than any Asset Disposition pursuant to clauses (a), (c), (e), (f), (g), (j), or (k) of the definition of “Permitted Asset Disposition”), including, for the avoidance of doubt, pursuant to (i) any Specified Sale Transaction or (ii) the Specified Store Closing Sales) in an amount equal to 100% of the Net Proceeds of such Asset Disposition, with such Net Proceeds to be applied to the Obligations in accordance with Section 5.5.  The Obligations shall also be prepaid in accordance with Section 8.6.2.  Upon the Agent’s request, the Borrower Agent shall promptly deliver a detailed calculation of the Net Proceeds received by any Obligor or Subsidiary in respect of any Asset Disposition or any insurance settlement or condemnation awarded, in form and substance reasonably satisfactory to the Agent.
(b)               Excess Availability.  Subject to Sections 2.1.4 and 2.1.5, if for any reason at any time, Excess Availability is less than $0, the Borrowers shall immediately prepay the Obligations in an aggregate amount equal to such deficiency, which prepayment shall be applied in accordance with the priorities set forth in Section 5.5, in each case until Excess Availability is equal to $0.
(c)               Cash Dominion.  The Obligations shall be repaid daily in accordance with Section 5.6, to the extent then applicable and without regard to minimum and incremental amounts otherwise required by this Loan Agreement.
(d)               Termination Date.  The Loans and all other Obligations (other than contingent Obligations which by their terms survive such termination) shall be due and payable in full on the Termination Date, unless payment is sooner required hereunder.
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5.3.         Payment of Other Obligations.  Obligations other than Loans, including LC Obligations and Extraordinary Expenses, shall be paid when due by Borrowers as provided in the Loan Documents or, if no payment date is specified, on demand.
5.4.         Marshaling; Payments Set Aside.  None of the Agent or the Lenders shall be under any obligation to marshal any assets in favor of any Obligor or against any Obligations.  If any Obligor makes a payment to the Agent or the Lenders, or if the Agent or any Lender receives payment from the proceeds of Collateral, exercise of setoff or otherwise, and such payment is subsequently invalidated or required to be repaid to a trustee, receiver or any other Person, then the Obligations originally intended to be satisfied, and all Liens, rights and remedies therefor, shall be revived and continued in full force and effect as if such payment had not been received and any enforcement or setoff had not occurred.
5.5.         Application of Proceeds.
5.5.1.          Pre-Default Allocation of Proceeds.  Notwithstanding anything herein to the contrary, but subject to the Order (including, without limitation, with respect to funding of the Carve Out Account in accordance with the Order), at all times when no Event of Default has occurred and is continuing, all proceeds or Net Proceeds (as applicable) of Collateral received by the Agent or any Secured Party and all proceeds or Net Proceeds (as applicable) realized from the Obligors on account of the Collateral (whether pursuant to Section 5.6 hereof or arising from realization on Collateral, setoff or otherwise), shall be allocated as follows:
(a)                first, to all costs and expenses, including Extraordinary Expenses, owing to the Agent, the Co-Collateral Agents and the Tranche A-1 Documentation Agent, including reimbursements owing to the Agent Professionals under Section 3.4;
(b)                second, to all amounts owing to the Agent constituting Protective Advances;
(c)               third, to permanently reduce the Pre-Petition Obligations (if any) (excluding the Pre-Petition Tranche A Prepayment Premium and the Pre-Petition Specified Tranche A-1 Prepayment Premium) in accordance with Section 5.5.1 of the Pre-Petition Loan Agreement, until paid in full, and then to fund the Prepetition ABL Indemnity Reserve (if applicable);
(d)                fourth, to all amounts owing to the Agent on Swingline Loans;
(e)                fifth, to all amounts owing to the Issuing Banks on LC Obligations;
(f)                sixth, to all Obligations constituting fees owing to the Tranche A Lenders in their capacity as Tranche A Lenders (excluding (i) the Pre-Petition Tranche A Prepayment Premium and (ii) Bank Product Debt);
(g)               seventh, to all Obligations constituting interest then owing on Tranche A Revolver Loans (excluding Bank Product Debt);
(h)               eighth, to all other Obligations owing to the Tranche A Lenders in their capacity as Tranche A Lenders (excluding (i) the Pre-Petition Tranche A Prepayment Premium and (ii) Bank Product Debt);
(i)                ninth, to fund the DIP Indemnity Account;
(j)                tenth, to all Obligations constituting fees owing to the Tranche A-1 Lenders in their capacity as Tranche A-1 Lenders (limited in the case of the Pre-Petition Specified Tranche A-1
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Prepayment Premium to the portion of the Pre-Petition Specified Tranche A-1 Prepayment Premium that would have constituted the Pre-Petition Tranche A-1 Prepayment Premium payable to the Pre-Petition Tranche A-1 Lenders (but for the operation of Section 3.2.5 of the Pre-Petition Loan Agreement, which provides that the Pre-Petition Specified Tranche A-1 Prepayment Premium is payable to the Pre-Petition Tranche A-1 Lenders in lieu of the Pre-Petition Tranche A-1 Prepayment Premium, and excluding, for the avoidance of doubt, Bank Product Debt);
(k)                eleventh, to all Obligations constituting interest then owing on Tranche A-1 Revolver Loans (excluding, for the avoidance of doubt, Bank Product Debt);
(l)                twelfth, to all other Obligations owing to the Tranche A-1 Lenders in their capacity as Tranche A-1 Lenders (excluding (i) the Pre-Petition Specified Tranche A-1 Prepayment Premium and (ii) for the avoidance of doubt, Bank Product Debt);
(m)               thirteenth, to all Obligations owing to Secured Parties constituting Bank Product Debt for which Agent has received written notice as provided under the definition of “Bank Product”;
(n)                fourteenth, to Bank Product Debt owing to the Lenders and their Affiliates for which Agent has not received written notice as provided under the definition of “Bank Product”;
(o)                fifteenth, to the Pre-Petition Tranche A Prepayment Premium owed to the Pre-Petition Tranche A Lenders (after giving effect to the waiver thereof with respect to the Tranche A Revolver Reduction Amount) and to the Pre-Petition Specified Tranche A-1 Prepayment Premium owed to the Pre-Petition Tranche A-1 Lenders (after giving effect to the waiver thereof with respect to the Prepaid Pre-Petition Tranche A-1 Revolver Loans) (other than the portion of the Pre-Petition Specified Tranche A-1 Prepayment Premium that would have constituted the Pre-Petition Tranche A-1 Prepayment Premium payable to the Pre-Petition Tranche A-1 Lenders (but for the operation of Section 3.2.5 of the Pre-Petition Loan Agreement, which provides that the Pre-Petition Specified Tranche A-1 Prepayment Premium is payable to the Pre-Petition Tranche A-1 Lenders in lieu of the Pre-Petition Tranche A-1 Prepayment Premium), which portion shall be payable pursuant to Section 5.5.1(j) above); and
(p)               sixteenth, to the Obligors or such other Person entitled thereto under Applicable Law.
Amounts shall be applied to each category of Obligations set forth above until Full Payment thereof and then to the next category.  If amounts are insufficient to satisfy a category, they shall be applied on a pro rata basis among the Obligations in the category.  Amounts distributed with respect to any Bank Product Debt or LC Obligations shall be the lesser of the applicable LC Obligations or Bank Product Amount last reported to Agent or the actual LC Obligations or Bank Product Debt as calculated by the methodology reported to Agent for determining the amount due.  The Agent shall have no obligation to calculate the amount to be distributed with respect to any Bank Product Debt, but may rely upon written notice of the amount (setting forth a reasonably detailed calculation) from the Secured Party.  In the absence of such notice, the Agent may assume the amount to be distributed is the Bank Product Amount last reported to it.  The allocations set forth in this Section 5.5.1 are solely to determine the rights and priorities of the Agent and Lenders as among themselves, and may be changed by agreement among them without the consent of any Obligor.  This Section 5.5.1 is not for the benefit of or enforceable by any Obligor.  Excluded Swap Obligations with respect to any Guarantor shall not be paid with amounts received from such Guarantor or its assets, but appropriate adjustments shall be made with respect to payments from other Obligors to preserve the allocation to the Obligations otherwise set forth above in this Section 5.5.1.
5.5.2.          Post-Default Allocation of Proceeds.  Notwithstanding anything herein to the contrary, but subject to the Order (including, without limitation, with respect to funding of the Carve Out
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Account in accordance with the Order), after the occurrence and during the continuance of an Event of Default, all proceeds of Collateral received by the Agent or any Secured Party and all proceeds realized from the Obligors on account of the Collateral (whether pursuant to Section 5.6 hereof or arising from realization on Collateral, setoff or otherwise), shall be allocated as follows:
(a)                first, to all costs and expenses, including Extraordinary Expenses, owing to the Agent, the Co-Collateral Agents and the Tranche A-1 Documentation Agent, including reimbursements owing to the Agent Professionals under Section 3.4;
(b)               second, to all amounts owing to the Agent constituting Protective Advances;
(c)               third, to permanently reduce the Pre-Petition Obligations (if any) (excluding the Pre-Petition Tranche A Prepayment Premium and the Pre-Petition Specified Tranche A-1 Prepayment Premium) in accordance with Section 5.5.2 of the Pre-Petition Loan Agreement, until paid in full, and then to fund the Prepetition ABL Indemnity Reserve (if applicable);
(d)                fourth, to all amounts owing to the Agent on Swingline Loans;
(e)                fifth, to all amounts owing to Issuing Bank on LC Obligations;
(f)                sixth, to all Obligations constituting fees owing to the Tranche A Lenders in their capacity as Tranche A Lenders (excluding (i) the Pre-Petition Tranche A Prepayment Premium and (ii) Bank Product Debt);
(g)                seventh, to all Obligations constituting interest then owing on Tranche A Revolver Loans (excluding Bank Product Debt);
(h)               eighth, to provide Cash Collateral for outstanding Letters of Credit in an amount equal to the Minimum Collateral Amount;
(i)                ninth, to all other Obligations owing to the Tranche A Lenders in their capacity as Tranche A Lenders (excluding (i) the Pre-Petition Tranche A Prepayment Premium and (ii) Bank Product Debt);
(j)                tenth, to fund the DIP Indemnity Account;
(k)               eleventh, to all Obligations constituting fees owing to the Tranche A-1 Lenders in their capacity as Tranche A-1 Lenders (limited in the case of the Pre-Petition Specified Tranche A-1 Prepayment Premium to the portion of the Pre-Petition Specified Tranche A-1 Prepayment Premium that would have constituted the Pre-Petition Tranche A-1 Prepayment Premium payable to the Pre-Petition Tranche A-1 Lenders (but for the operation of Section 3.2.5 of the Pre-Petition Loan Agreement, which provides that the Pre-Petition Specified Tranche A-1 Prepayment Premium is payable to the Pre-Petition Tranche A-1 Lenders in lieu of the Pre-Petition Tranche A-1 Prepayment Premium, and excluding, for the avoidance of doubt, Bank Product Debt));
(l)                 twelfth, to all Obligations constituting interest then owing on Tranche A-1 Revolver Loans (excluding, for the avoidance of doubt, Bank Product Debt);
(m)               thirteenth, to all other Obligations owing to the Tranche A-1 Lenders in their capacity as Tranche A-1 Lenders (excluding (i) the Pre-Petition Specified Tranche A-1 Prepayment Premium and (ii) for the avoidance of