CREDIT AGREEMENT Dated as of March 26, 2010 among CHAUTAUQUA AIRLINES, INC., as Borrower, REPUBLIC AIRWAYS HOLDINGS INC., as Parent Guarantor, THE SUBSIDIARIES OF THE BORROWER FROM TIME TO TIME, as Guarantors, as Original Lender, THE LENDERS SIGNATORY...

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SECTION 5.7.        Environmental Matters.

 

Each Borrower Group Member shall and shall cause each Person within its control to: (a) conduct its operations and keep and maintain its Real Estate in compliance with all Environmental Laws and Environmental Permits other than noncompliance that could not reasonably be expected to have a Material Adverse Effect; (b) implement any and all investigation, remediation, removal and response actions that are necessary to comply in all material respects with Environmental Laws and Environmental Permits pertaining to the presence, generation, treatment, storage, use, disposal, transportation or Release of any Hazardous Material on, at, in, under, above, to, from or about any of its Real Estate; (c) notify the Administrative Agent promptly after such Borrower Group Member becomes aware of any violation of Environmental Laws or Environmental Permits or any Release on, at, in, under, above, to, from or about any Real Estate that is reasonably likely to result in the Borrower incurring Environmental Liabilities in excess of [*] individually or [*] in the aggregate in a Fiscal Year; and (d) promptly forward to the Administrative Agent a copy of any order, notice, request for information or any communication or report received by such Borrower Group Member in connection with any such violation or Release or any other matter relating to any Environmental Laws or Environmental Permits that could reasonably be expected to result in  any Borrower Group Member incurring Environmental Liabilities in excess of [*] individually or [*] in the aggregate in a Fiscal Year.

 

SECTION 5.8.        Further Assurances.

 

Subject to Section 5.9(b), the Parent Guarantor and each Borrower Group Member agrees that it shall, at its expense and upon the reasonable request of the Administrative Agent, duly execute and deliver, or cause to be duly executed and delivered, to the Administrative Agent such further instruments and do and cause to be done such further acts as may be necessary or reasonably requested by the Administrative Agent to carry out more effectively the provisions and purposes of this Agreement and each Loan Document.

 

SECTION 5.9.        Additional Collateral Documents.

 

(a)           To the extent not delivered to the Administrative Agent on or before the Closing Date (including in respect of after-acquired property), each Borrower Group Member agrees to do promptly each of the following, unless otherwise agreed by the Administrative Agent:

 

(i)             deliver to the Administrative Agent such duly executed supplements and amendments to any of the Collateral Documents, in each case in form and substance reasonably satisfactory to the Administrative Agent and as the Administrative Agent reasonably deems necessary in order to effectively grant to the Administrative Agent for the benefit of the Lenders, a valid, first-priority, perfected and enforceable security interest in all assets, personal property or property interests that constitute Collateral;

 

(ii)            deliver to the Administrative Agent all certificates, instruments and other documents representing all Collateral required to be pledged and delivered under the Collateral Documents;

 

(iii)           take such other actions as the Administrative Agent reasonably deems necessary to create, maintain, perfect or protect the security interest required to be granted pursuant to clause (i) above, including the filing of financing statements or other recordations in such jurisdictions as may be required by the Collateral Documents, the Code, the DOT, the FAA or applicable law, or as may be reasonably requested by the Administrative Agent; and

 

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(iv)          if requested by the Administrative Agent, deliver to the Administrative Agent legal opinions relating to the matters described above in connection with Collateral acquired or subjected to the Lien of the Guarantee and Collateral Agreement after the date hereof, which opinions shall be in form and substance consistent with those delivered on the Closing Date and from counsel reasonably satisfactory to the Administrative Agent.

 

(b)           Notwithstanding the foregoing, (i) the Administrative Agent shall not take any security interest in or require any actions to be taken with respect to any property to the extent that the granting of such a security interest would constitute a breach or violation of a valid and effective restriction in place as of the date hereof in favor of a third party (including, without limitation, mandatory consent rights; and the parties agree that the Administrative Agent shall not require any action to be taken with respect to such consent rights), that would result in the termination of any Borrower Group Member’s interest in such property or give rise to any indemnification obligations or any right to terminate or commence the exercise of remedies under such restrictions, and (ii) Liens required to be granted and actions required to be taken pursuant to this Section 5.9 shall all be subject to exceptions and limitations (including Liens permitted pursuant to Section 6.7) consistent with those set forth herein and in the Collateral Documents. Nothing in this Section 5.9(b) shall obligate the Administrative Agent or any Lender to release its Lien on any Collateral.

 

SECTION 5.10.      Access.

 

Each Borrower Group Member shall provide the Administrative Agent access to its properties and to the Collateral in accordance with Section 1.9.

 

SECTION 5.11.      Slot Utilization.

 

Subject to transfers, exchanges and other dispositions permitted by this Agreement, each Borrower Group Member will utilize (or arrange for utilization by leasing or exchanging Slots with other air carriers) the Slots in a manner consistent in all material respects with applicable regulations, rules, laws and contracts in order to preserve its right to hold and operate the Slots, taking into account any waivers or other relief granted to such Borrower Group Member by the FAA, any other applicable Governmental Authority or any Airport Authority, except to the extent that the failure to do so could not reasonably be expected to have a Material Adverse Effect.

 

SECTION 5.12.      ERISA/Labor Matters.

 

A Loan Party shall furnish the Administrative Agent (with sufficient copies for each of Lenders) each of the following:

 

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(a)           promptly and in any event within [*] Business Days after any Borrower Group Member or any ERISA Affiliate knows that a request for a minimum funding waiver under Section 412 of the Code has been filed with respect to any Multiemployer Plan, a written statement of an officer of such Borrower Group Member or ERISA Affiliate describing such waiver request and the action, if any, such Borrower Group Member and any ERISA Affiliate propose to take with respect thereto and a copy of any notice filed with the PBGC or the IRS pertaining thereto;

 

(b)           promptly and in any event within [*] Business Days after any Borrower Group Member or any ERISA Affiliate receives any adverse communication from a Governmental Authority (including a non-US Governmental Authority) that could result in a material increase to or accelerate the payment of any material liability with respect to a Pension Plan, a copy of such notice;

 

(c)           promptly and in any event within [*] Business Days after any Borrower Group Member (i) commences or terminates negotiations with any collective bargaining agent for the purpose of materially changing any collective bargaining agreement; (ii) reaches an agreement with any collective bargaining agent prior to ratification for the purpose of materially changing any collective bargaining agreement; (iii) ratifies any agreement reached with a collective bargaining agent for the purpose of materially changing any collective bargaining agreement; or (iv) becomes subject to a “cooling off period” under the auspices of the National Mediation Board, notification of the commencement or termination of such negotiations, a copy of such agreement or notice of such ratification or “cooling off period,” as the case may be;

 

(d)           promptly and in any event within [*] Business Days after any Borrower Group Member or any ERISA Affiliate knows that any ERISA Event has occurred, a statement describing such ERISA Event and the action, if any, that such Borrower Group Member or ERISA Affiliate has taken and proposes to take with respect thereto and, on the date any records, documents or other information must be furnished to the PBGC or other applicable Governmental Authority with respect to such ERISA Event, a copy of such records, documents and information;

 

(e)           promptly and in any event within [*] Business Days following receipt thereof, copies of any documents described in Sections 101(k) or 101(l) of ERISA that any Borrower Group Member or any ERISA Affiliate may request with respect to any Multiemployer Plan; provided, that if the Borrower Group Members or any of their ERISA Affiliates have not requested such documents or notices from the administrator or sponsor of the applicable Multiemployer Plan, then, upon reasonable request of the Administrative Agent, the Borrower Group Member and/or their ERISA Affiliates shall promptly make a request for such documents or notices from such administrator or sponsor and the Borrower shall provide copies of such documents and notices to the Administrative Agent promptly after receipt thereof, and further provided, that the rights granted to the Administrative Agent in this section shall be exercised not more than once during a 12-month period; and

 

(f)           promptly and in any event within [*] Business Days after receipt thereof by any Borrower Group Member or ERISA Affiliate from a sponsor of a Multiemployer Plan, copies of each notice concerning (i)(A) the imposition of Withdrawal Liability by such Multiemployer Plan or (B) the Reorganization, Insolvency or termination, within the meaning of Title IV of ERISA, of any such Multiemployer Plan or the determination that such Multiemployer Plan is in “endangered status” or “critical status” within the meaning of Section 432 of the IRC, and (ii) the amount of liability incurred or that may be incurred by the Borrower or any ERISA Affiliate in connection with any event described in clause (i).

 

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SECTION 5.13.      Maintenance of Liens and Collateral.

 

 Each Borrower Group Member, subject to Section 5.9, shall do or cause to be done all things necessary to preserve and keep in full force and effect at all times the Liens securing the Obligations as provided in the Loan Documents.

 

SECTION 5.14.      Use of Proceeds.

 

The proceeds of the Loan will be used by the Borrower for the purposes specified in Section 1.4.

 

SECTION 5.15.      Pari Passu.

 

The Borrower shall ensure that its obligations under the Loan Documents shall at all times rank at least pari passu with all its present and future unsecured and unsubordinated indebtedness with the exception of any obligations that are mandatorily preferred by any applicable laws to companies generally and not by contract.

 

ARTICLE 6

 

NEGATIVE COVENANTS

 

Each of the Borrower Group Members and, in the case of Sections 6.1(b) and 6.2(b) only, the Parent Guarantor agrees that from and after the Closing Date until the Termination Date:

 

SECTION 6.1.        Sale of Stock and Assets.

 

(a)           No Borrower Group Member shall sell, transfer, convey, assign or otherwise dispose of any of its properties or other assets, including the Stock of any of its Subsidiaries (whether in a public or a private offering or otherwise) (any such disposition being an “Asset Sale”), other than the following (without duplication):

 

(i)           sales and other dispositions of immaterial assets in the ordinary course of business, and swaps, exchanges, interchange or pooling of assets in the ordinary course of business;

 

(ii)          sales or dispositions of surplus, obsolete, negligible or uneconomical assets no longer used or useful in the business of such Borrower Group Member;

 

(iii)           [Intentionally Omitted];

 

(iv)          sales or dispositions of Inventory (other than Collateral) in the ordinary course of business;

 

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(v)           subject to Section 1.2(b)(iv) in respect of sales or dispositions of assets that comprise the Collateral, sales or dispositions of other assets in arm’s length transactions at fair market value in an aggregate amount not to exceed [*] in the aggregate in any Fiscal Year;

 

(vi)          (x) sale, disposition, exchange or abandonment of Intellectual Property; provided, that such abandonment is (A) in the ordinary course of business consistent with past practices and (B) with respect to Intellectual Property that is not material to the business of such Borrower Group Member and (y) licensing or sublicensing of Intellectual Property in the ordinary course of business consistent with past practices;

 

(vii)         sale, disposition, exchange, lease or abandonment of Slots unless such sale, disposition, exchange, lease or abandonment could reasonably be expected to result in a Material Adverse Effect;

 

(viii)        sale-leaseback, synthetic lease or similar transactions involving Section 1110 Assets (other than such Section 1110 Assets that comprise the Collateral), aircraft or engines;

 

(ix)           the disposition of leasehold or similar interests in Real Estate that is not owned Real Estate (including Gate Interests), including through assignment, sublease or lease termination, as a whole or in part, or the return, surrender, exchange or abandonment of any property subject thereto to the extent any such disposition individually or all such dispositions in the aggregate could not reasonably be expected to result in a Material Adverse Effect; and

 

(x)           sale or disposition of aircraft, engines or spare parts, so long as such sale is consistent in all material respects with the Projections.

 

(b)           The Parent Guarantor shall not sell, transfer, convey or otherwise dispose of the Stock of (i) the Borrower or (ii) the Subsidiary of the Parent Guarantor (other than Lynx) with the highest gross revenues among all Subsidiaries of the Parent Guarantor (excluding the Borrower) for the preceding four full Fiscal Quarters, determined in accordance with GAAP at the time of such sale, transfer, conveyance or disposition.

 

SECTION 6.2.        Mergers.

 

(a)           No Borrower Group Member may enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or sell, lease, sell and leaseback, assign, convey, transfer or otherwise dispose of all or substantially all of its property or business, except that:

 

(i)             any Borrower Group Member (other than the Borrower) may be merged or consolidated with or into the Borrower (provided that the Borrower shall be the continuing or surviving corporation) or with or into any other Borrower Group Member (other than the Borrower);

 

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(ii)            any Borrower Group Member (other than the Borrower) may sell, lease, sell and leaseback, assign, convey, transfer or otherwise dispose of any or all of its assets (A) to the Borrower or any other Borrower Group Member (upon voluntary liquidation or otherwise) or (B) pursuant to an Asset Sale permitted by Section 6.1; and

 

(iii)           any Investment expressly permitted by Section 6.5 may be structured as a merger, consolidation or amalgamation.

 

(b)           The Parent Guarantor may not enter into any merger, consolidation or amalgamation, or liquidate, wind up or dissolve itself (or suffer any liquidation or dissolution), or sell, lease, sell and leaseback, assign, convey, transfer or otherwise dispose of all or substantially all of its property or business other than pursuant to a Permitted Merger.

 

SECTION 6.3.        Restricted Payments.

 

No Borrower Group Member shall make any Restricted Payment except (a) Restricted Payments made by any Borrower Group Member (other than the Borrower) to the Borrower, and (b) inter-company loans and advances made by the Borrower to the extent permitted under Section 6.5(c).

 

SECTION 6.4.        Indebtedness.

 

(a)           No Borrower Group Member shall create, incur, assume or permit to exist any Indebtedness, except (without duplication):

 

(i)             Indebtedness secured by purchase money security interests and Capital Leases (including in the form of sale-leaseback, synthetic lease or similar transactions) to the extent such Indebtedness (A) finances the acquisition or construction of aircraft, engines or spare parts (other than Spare Parts) or (B) finances the acquisition or construction of other assets and the principal amount of any such Indebtedness permitted under this clause (B) does not exceed [*] at any one time outstanding; provided, that the amount of such Indebtedness does not exceed [*]% of the purchase price or construction cost (including any capitalized interest and issuance fees) of the subject asset;

 

(ii)            the Loan and the other Obligations;

 

(iii)           Indebtedness existing as of the Closing Date described in Schedule 6.4 (including, for the avoidance of doubt, Indebtedness that may be incurred from time to time under revolving lines of credit referred to on Schedule 6.4);

 

(iv)          Indebtedness owed to any Lender (or any of its Affiliates) or any other Person in connection with Investments permitted under Section 6.5(d);

 

(v)           Indebtedness in respect of any overdrafts and related liabilities arising from treasury, depository and cash management services or in connection with any automated clearing house transfers of funds;

 

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(vi)          Indebtedness to credit card processors in connection with credit card processing services and affinity card programs incurred in the ordinary course of business and consistent with past practices;

 

(vii)         Indebtedness in respect of letters of credit, surety and appeal bonds in an aggregate outstanding amount not to exceed [*];

 

(viii)        Indebtedness constituting a Permitted Refinancing of Indebtedness referred to in clauses (i) or (iii) above or (xii) below;

 

(ix)           unsecured Indebtedness (including letters of credit) incurred subsequent to the Closing Date to provide credit support for (x) obligations arising in the ordinary course of business and consistent with past practices in connection with credit card processing services and affinity card programs and (y) the Indebtedness described in clause (v) above;

 

(x)            other unsecured Indebtedness incurred subsequent to the Closing Date in an aggregate amount not to exceed [*] outstanding at any time;

 

(xi)           (A) Guaranteed Indebtedness incurred (x) by endorsement of instruments or items of payment for deposit to the general account of such Borrower Group Member in the ordinary course of business, or (y) for the benefit of any Loan Party if the primary obligation is expressly permitted by this Agreement, and (B) Guaranteed Indebtedness to the extent existing on the Closing Date as set forth in Schedule 6.4;

 

(xii)          Indebtedness (A) financing the acquisition of aircraft, engines or spare parts (other than Spare Parts) or the making of deposits or predelivery payments in connection with any such acquisition, in each case to the extent such acquisition is consistent with the Projections and is expected to be financed with Indebtedness permitted pursuant to Section 6.4(a)(i), or (B) otherwise secured by any aircraft, engines or spare parts (other than Spare Parts); and

 

(xiii)         inter-company Indebtedness permitted under Section 6.5(c).

 

(b)           No Borrower Group Member shall, directly or indirectly, voluntarily purchase, redeem, defease or prepay any principal of, premium, if any, interest or other amount in respect of any Indebtedness prior to its scheduled maturity, other than (i) the Obligations; (ii) Indebtedness secured by a Lien permitted under Section 6.6 if the asset securing such Indebtedness on a first-priority basis has been sold or otherwise disposed of in accordance with Section 6.1 and the proceeds of such sale or disposal are used to repay such Indebtedness; (iii) Indebtedness utilized to finance the acquisition of any aircraft, engines or spare parts (other than Spare Parts); (iv) Indebtedness subject to any Permitted Refinancing; (v) other Indebtedness not in excess of [*]; (vi) Indebtedness incurred subsequent to the Closing Date permitted under Section 6.4(a) (other than Indebtedness permitted under Section 6.4(a)(iii) or any Permitted Refinancing thereof); and (vii) as otherwise permitted in Section 6.3.

 

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SECTION 6.5.        Investments; Loan and Advances.

 

No Borrower Group Member shall make or permit to exist any Investment except (without duplication):

 

(a)           Investments comprised of extensions of credit in the nature of accounts receivable or notes receivable arising from the grant of trade credit in the ordinary course of business, or of notes payable, or stock or other securities, issued by Account Debtors to such Borrower Group Member pursuant to negotiated agreements with respect to settlement of such Account Debtor’s Accounts in the ordinary course of business, consistent with past practices;

 

(b)           Investments existing as of the Closing Date summarized on Schedule 6.5;

 

(c)           Investments by the Borrower in (i) the Parent Guarantor, (ii) any Subsidiary of the Parent Guarantor (other than any Borrower Group Member), and (iii) any other Borrower Group Member; provided that any such Investments made on or after the Closing Date do not exceed an aggregate amount equal to [*], and in the case of (i) and (iii), such Investments consisting of inter-company loans shall be subordinated to the Obligations on terms reasonably satisfactory to the Administrative Agent; and provided further, however, that none of the limitations or requirements contained in the foregoing proviso shall apply to any inter-company loans made by the Borrower to the Parent Guarantor; provided further, however, on the Closing Date, the Parent Guarantor shall pledge to the Administrative Agent pursuant to the Guarantee and Collateral Agreement revolving inter-company notes of each Subsidiary (other than the Borrower Group Members), which shall be in an aggregate face amount (but allocated among such Subsidiaries on a pro rata or other basis reasonably acceptable to the Administrative Agent) not less than the amount by which the inter-company cash advances made by the Borrower to the Parent Guarantor from time to time outstanding exceed in the aggregate the total amount of cash and Cash Equivalents then held by the Parent Guarantor;

 

(d)           the Borrower may make Investments consisting of (i) currency swap agreements, currency future or option contracts and other similar agreements designed to hedge against fluctuations in foreign interest rates and currency values, (ii) interest rate swap, cap or collar agreements and interest rate future or option contracts, and (iii) fuel ▇▇▇▇▇▇ and other derivatives contracts, in each case, to the extent that such agreement or contract is entered into in the ordinary course of business and not for speculation;

 

(e)           Investments in fuel consortia in the ordinary course of business consistent with past practice and consistent with industry practice;

 

(f)           Investments in the form of Cash Equivalents;

 

(g)           advances to officers, directors and employees of any Borrower Group Member in an aggregate amount not to exceed [*] at any time outstanding, for travel, entertainment, relocation and analogous ordinary business purposes;

 

(h)           Guaranteed Indebtedness permitted by Section 6.4; and

 

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(i)           the Borrower may make other Investments in an aggregate amount outstanding at any one time not to exceed [*] for all Investments made pursuant to this clause (i).

 

SECTION 6.6.        Liens.

 

No Borrower Group Member shall create, incur, assume or permit to exist any Lien on or with respect to (i) the Collateral or (ii) any of its other properties or assets (whether now owned or hereafter acquired), except for:

 

(a)           Permitted Encumbrances;

 

(b)           Liens securing Indebtedness permitted by Section 6.4(a)(xii), to the extent such Lien is solely with respect to the applicable aircraft, engines or spare parts, any purchase contract relating thereto and any proceeds thereof.

 

(c)           Liens created by conditional sale or other title retention agreements (including Capital Leases) or in connection with purchase money Indebtedness, in each case, permitted under Section 6.4(a)(i); provided, that (A) such Liens attach only to the assets (including related leases and subleases thereof and other assets integral to the use thereof including security deposits from any sublessee collaterally assigned for the benefit of lessors) subject to such purchase money debt, and (B) such Indebtedness is incurred within [*] days following such purchase and does not exceed [*] of the purchase price of the subject assets;

 

(d)           Liens securing Indebtedness permitted by Section 6.4(a)(v);

 

(e)           Liens on its deposit and operating accounts and amounts on deposit therein in favor of the beneficiaries of the amounts on deposit therein to the extent such Liens secure obligations owed to such beneficiaries and such obligations are otherwise permitted pursuant this Agreement;

 

(f)            any interest or title of a licensor, lessor or sublessor granted to others, but, with respect to the Collateral, only to the extent permitted by any of the Collateral Documents;

 

(g)           customary banker’s Liens on its bank accounts and amounts on deposit therein in favor of the depositary institutions where such accounts are maintained to secure fees, overdrafts, returned checks, and similar obligations;

 

(h)           Liens in respect of rights of setoff, recoupment and holdback in favor of credit card processors securing obligations in connection with credit card processing services incurred in the ordinary course of business and consistent with past practices;

 

(i)            Liens on cash deposits securing obligations referred to in Section 6.4(a)(vii) in an aggregate amount not in excess of [*];

 

(j)            Liens on cash deposits pledged as collateral for Indebtedness permitted under Section 6.4(a)(iv) in connection with Investments permitted under Section 6.5(d);

 

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(k)           Liens securing a Permitted Refinancing of Indebtedness, to the extent such Indebtedness being refinanced was originally secured in accordance with this Section 6.6; provided that such Lien does not attach to any additional property or assets of any Borrower Group Member;

 

(l)            Liens securing the Loan and the other Obligations;

 

(m)          Liens created in connection with operating Leases; provided that, such Liens attach only to the assets subject to such Lease (including any sublease thereof, other assets integral to the use thereof and security deposits from any sublessee collaterally assigned for the benefit of lessors); and

 

(n)           other Liens so long as the value of the property subject to such Liens, and the Indebtedness and other obligations secured thereby, do not exceed, in the aggregate, [*].

 

SECTION 6.7.        Limitation on Negative Pledge Clauses.

 

No Borrower Group Member will enter into any agreement (other than the Loan Documents) with any Person which prohibits or limits the ability of such Borrower Group Member to create, incur, assume or suffer to exist any Lien securing the Obligations upon any of its properties, assets or revenues, whether now owned or hereafter acquired, other than agreements that contain (a) prohibitions or limitations existing on the Closing Date and listed on Schedule 6.7, and any extension or renewal thereof on terms no less favorable to such Borrower Group Member, (b) prohibitions set forth in the Loan Documents, (c) prohibitions or restrictions imposed by any agreement relating to secured Indebtedness or other obligations permitted by this Agreement if such prohibition or restriction applies only to property secured or financed by such Indebtedness or other obligations and (d) restrictions prohibiting Liens contained in agreements relating to the use and occupancy of airport premises and facilities, operating leases, Capital Leases or Licenses with respect to properties subject thereto and interests created therein.

 

SECTION 6.8.        Affiliate Transactions.

 

No Borrower Group Member will sell or transfer any property or assets to, or otherwise engage in any other material transactions with, any of its Affiliates (other than between Loan Parties), except transactions (a) at prices and on terms and conditions no less favorable to such Borrower Group Member than could be obtained on an arm’s length basis from unrelated third parties and (b) any dividends, other distributions or payments permitted by Section 6.3.

 

SECTION 6.9.        Capital Expenditures.

 

No Borrower Group Member may make or commit to make any Capital Expenditure, except Capital Expenditures of Borrower Group Members (i) for aircraft, engines, aircraft spare parts and ground handling equipment or (ii) in the ordinary course of business not exceeding [*] in the aggregate in any Fiscal Year; provided, that (a) all or any portion of the amount referred to in clause (ii) above, if not so expended in the Fiscal Year for which it is permitted, may be carried over for expenditure in the next succeeding Fiscal Year and (b) Capital Expenditures made pursuant to clause (ii) above during any Fiscal Year shall be deemed made, first, in respect of amounts permitted for such Fiscal Year as provided above and, second, in respect of amounts carried over from the prior Fiscal Year pursuant to clause (a) above.

 

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SECTION 6.10.      Clauses Restricting Subsidiary Distributions.

 

No Subsidiary of the Borrower shall enter into or suffer to exist or become effective any consensual encumbrance or restriction on its ability to (a) make Restricted Payments in respect of any Stock of such Subsidiary held by, or pay any Indebtedness owed to, the Borrower or any other Borrower Group Member, (b) make loans or advances to, or other Investments in, the Borrower or any other Borrower Group Member or (c) transfer any of its assets to the Borrower or any other Borrower Group Member, except for such encumbrances or restrictions existing under or by reason of (i) any restrictions existing under the Loan Documents, (ii) any agreements existing on the Closing Date and listed on Schedule 6.10 and (iii) any restrictions with respect to a Subsidiary imposed pursuant to an agreement that has been entered into in connection with the disposition of all or substantially all of the Stock or assets of such Subsidiary.

 

SECTION 6.11.      Capital Structure and Business.

 

No Borrower Group Member shall amend its Organization Documents in a manner that would adversely affect in any material respect the rights or remedies of the Administrative Agent or Lenders under the Loan Documents, or such Borrower Group Member’s duty or ability to repay the Obligations. No Borrower Group Member shall engage in any business other than the businesses currently engaged in by it and businesses that are reasonably related thereto. No Borrower Group Member shall make any changes to its equity capital structure as in existence on the Closing Date, except pursuant to any transaction permitted under any other provision contained herein.

 

SECTION 6.12.      Change of Fiscal Year.

 

No Borrower Group Member shall change its Fiscal Year other than to conform its Fiscal Year with the Fiscal Year of the Parent Guarantor.

 

SECTION 6.13.      Financial Covenants.

 

The Borrower shall not breach or fail to comply with any of the Financial Covenants.

 

ARTICLE 7

 

TERM

 

SECTION 7.1.        Termination.

 

The financing arrangements contemplated hereby shall be in effect until the Maturity Date (or, if earlier, the Termination Date), and the Loan and all other Obligations shall be automatically due and payable in full on the Maturity Date.

 

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SECTION 7.2.        Survival of Obligations Upon Termination of Financing Arrangements.

 

Except as otherwise expressly provided for in the Loan Documents, no termination or cancellation (regardless of cause or procedure) of any financing arrangement under this Agreement shall in any way affect or impair the obligations, duties and liabilities of any Loan Party or the rights of the Administrative Agent and the Lenders relating to any unpaid portion of the Loan or any other Obligations, due or not due, liquidated, contingent or unliquidated or any transaction or event occurring prior to such termination, or any transaction or event, the performance of which is required after the Maturity Date. Except as otherwise expressly provided herein or in any other Loan Document, all undertakings, agreements, covenants, warranties and representations of or binding upon each Loan Party, and all rights of the Administrative Agent and each Lender, all as contained in the Loan Documents, shall not terminate or expire, but rather shall survive any such termination or cancellation and shall continue in full force and effect until the Termination Date; provided, that the payment obligations under Sections 1.11, 1.12 and 1.13, and the indemnities contained in the Loan Documents shall survive the Termination Date.

 

ARTICLE 8

 

EVENTS OF DEFAULT; RIGHTS AND REMEDIES

 

SECTION 8.1.        Events of Default.

 

The occurrence of any one or more of the following events (regardless of the reason therefor) shall constitute an “Event of Default” hereunder:

 

(a)           Any Loan Party (i) fails to make any payment of principal of the Loan or scheduled interest in respect thereof when due and payable, or (ii) fails to make any payment of any interest (not referred to in clause (i)) or any other Obligations not covered in clause (i) above within three [*] Business Days of the date when due and payable.

 

(b)           Any Loan Party fails or neglects to perform or observe (i) any of the provisions of Section 1.2, Section 4.1 with respect to paragraph (e) of Annex B, Section 5.1(a)(i) or Article 6 on its part to be performed or observed, (ii) any of the provisions of Section 4.1 (other than with respect to paragraph (e) of Annex B) on its part to be performed or observed and such failure continues for ten [*] Business Days from the date that the Administrative Agent delivers to the Borrower written notice of such failure, or (iii) any of the provisions of Article 5 (other than Section 5.1(a)(i)) on its part to be performed or observed and such failure continues for [*] days from the date that the Administrative Agent delivers to the Borrower written notice of such failure.

 

(c)           Any representation or warranty of any Loan Party contained herein or in any other Loan Document or in any written statement, report, financial statement or certificate made or delivered to the Administrative Agent or any Lender by any Loan Party is untrue or incorrect in any material respect, in each case, as of the date when made or deemed made.

 

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(d)           (i) Any Loan Party shall consent to the appointment of or the taking of possession by a receiver, trustee or liquidator of itself or of substantially all of its property, or (ii) any Loan Party shall admit in writing its inability to pay its debts generally as they come due, or does not pay its debts generally as they become due or shall make a general assignment for the benefit of creditors, or (iii) any Loan Party shall file a voluntary petition in bankruptcy or a voluntary petition or an answer seeking reorganization, liquidation or other relief in a case under any bankruptcy laws or other insolvency laws (as in effect at such time), or (iv) any Loan Party shall seek relief by voluntary petition, answer or consent, under the provisions of any other bankruptcy or other similar law providing for the reorganization or winding-up of corporations (as in effect at such time) or (v) any Loan Party’s board of directors shall adopt a resolution authorizing any of the foregoing.

 

(e)           An order, judgment or decree shall be entered by any court of competent jurisdiction appointing, without the consent of the applicable Loan Party, a receiver, trustee or liquidator of any Loan Party or of substantially all of its property, or substantially all of the property of any Loan Party shall be sequestered, and any such order, judgment or decree of appointment or sequestration shall remain in force undismissed, unstayed and unvacated for a period of thirty [*] days after the date of entry thereof; or a petition against any Loan Party in a case under any bankruptcy laws or other insolvency laws (as in effect at such time) is filed and not withdrawn or dismissed within [*] days thereafter, or if, under the provisions of any law providing for reorganization or winding-up of corporations which may apply to any Loan Party, any court of competent jurisdiction assumes jurisdiction, custody or control of any Loan Party or of substantially all of its property and such jurisdiction, custody or control remains in force unrelinquished, unstayed and unterminated for a period of [*] days.

 

(f)            (i) A final judgment or judgments for the payment of money in excess of [*] in the aggregate (to the extent not covered by insurance policies as to which liability has been accepted by the insurance carrier) at any time are outstanding against one or more Borrower Group Members or (ii) a final judgment or judgments for the payment of money in excess of [*] in the aggregate (to the extent not covered by insurance policies as to which liability has been accepted by the insurance carrier) at any time are outstanding against the Parent Guarantor or any Subsidiary thereof that is not a Borrower Group Member, and the same shall remain undischarged, unvacated and unstayed for a period of [*] consecutive days after the entry thereof.

 

(g)           The Loan Documents shall, for any reason (other than pursuant to the terms hereof of thereof), cease to create a valid Lien on any of the Collateral purported to be covered thereby or such Lien shall cease to be a perfected Lien having the priority provided for in the Collateral Documents, or any Loan Party shall so allege in any pleading filed in any court, or any material provision of any Loan Document shall, for any reason, cease to be valid and binding on any Loan Party party thereto (or any Loan Party shall challenge the enforceability of any Loan Document or shall assert in writing, or engage in any action or inaction based on any such assertion, that any material provision of any of the Loan Documents has ceased to be or otherwise is not valid, binding and enforceable in accordance with its terms).

 

(h)           The Borrower shall cease to be a Certificated Air Carrier.

 

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(i)            In the case of any Slots or Gate Interests, any applicable Aviation Authority modifies, suspends, revokes, terminates, cancels or otherwise takes any action that adversely affects any Borrower Group Member’s Permits or any Borrower Group Member’s use or occupation or maintenance of or other interest in such Slots and Gate Interests due to any Borrower Group Member’s failure to abide by applicable law or any contract governing the use of such Slots and Gate Interests, or any Borrower Group Member otherwise ceases to use, occupy or maintain such Slots and Gate Interests, and any event referred to in this clause (i) could reasonably be expected to have a Material Adverse Effect.

 

(j)            (i) An ERISA Event shall have occurred, (ii) any Qualified Plan shall lose its qualified or tax exempt status or any Foreign Plan shall fail to maintain its good standing, or (iii) a Prohibited Transaction shall have occurred; and in each case in clauses (i) through (iii), such event or condition, together with all other such events or conditions that have occurred, if any, could reasonably be expected to have a Material Adverse Effect.

 

(k)           Any “Event of Default” or analogous term (as defined in the applicable Cross Default Agreement) after giving effect to any applicable notice, cure and grace periods (each, a “Cross Default”), shall have occurred and be continuing under (i) any Cross Default Agreement (unless waived under such Cross Default Agreement pursuant to the terms thereof, or unless waived hereunder by the Lender Party party to such Cross Default Agreement, in such Lender Party’s sole discretion) or (ii) the Bombardier Purchase Agreement (unless waived under the Bombardier Purchase Agreement pursuant to the terms thereof); provided that any Cross Default that occurs under any Cross Default Agreement between (i) any Lender Party other than the Original Lender or any Affiliate thereof and (ii) any of the Borrower, the Parent Guarantor or any of their respective Affiliates, shall not constitute an Event of Default under this subsection (k) unless such Lender Party shall hold at least [*] of the outstanding principal amount of the Loan.

 

SECTION 8.2.        Remedies.

 

If any Event of Default has occurred and is continuing, (i) the Administrative Agent may (and at the written request of the Requisite Lenders shall) terminate the Commitments, if any, and/or declare all or any portion of the Obligations, including all or any portion of any Loan, to be forthwith due and payable, all without presentment, demand, protest or further notice of any kind, all of which are expressly waived by the Loan Parties, or in the case of an Event of Default under Section 8.1(d)(iii) or (iv) with respect to the Borrower or the Parent Guarantor the Obligations shall automatically become due and payable, and (ii) the Administrative Agent may (and at the written request of the Requisite Lenders, shall), without notice, exercise any rights and remedies provided to the Administrative Agent under the Loan Documents or at law or equity, including all remedies provided under the Code.

 

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SECTION 8.3.        Waivers by Borrower.

 

Except as otherwise provided for in this Agreement or by applicable law, the Loan Parties waive: (a) presentment, demand and protest and notice of presentment, dishonor, notice of intent to accelerate, notice of acceleration, protest, default, nonpayment, maturity, release, compromise, settlement, extension or renewal of any or all commercial paper, accounts, contract rights, documents, instruments, chattel paper and guaranties at any time held by the Administrative Agent on which any Loan Party may in any way be liable, (b) all rights to notice and a hearing prior to the Administrative Agent’s taking possession or control of, or to the Administrative Agent’s replevy, attachment or levy upon, the Collateral or any bond or security that might be required by any court prior to allowing the Administrative Agent to exercise any of its remedies, and (c) the benefit of all valuation, appraisal, marshaling and exemption laws.

 

ARTICLE 9

 

ASSIGNMENT AND PARTICIPATIONS;

THE ADMINISTRATIVE AGENT

 

SECTION 9.1.        Assignment and Participations.

 

(a)           Right to Assign. Each Lender may sell, transfer, negotiate or assign all or a portion of its rights and obligations hereunder (including all or a portion of its Commitments and its rights and obligations with respect to the Loan) to any other Person acceptable to the Administrative Agent, provided, that the aggregate outstanding principal amount (determined as of the effective date of the applicable Assignment) of the Loan and Commitments subject to any such Sale shall be in a minimum amount equal to [*], unless such Sale is made to an existing Lender or an Affiliate or Approved Fund of any existing Lender, is of the assignor’s (together with its Affiliates’ and Approved Funds’) entire interest in the Loan or is made with the prior written consent of the Borrower and the Administrative Agent; provided, however, that no Lender shall sell, transfer, negotiate or assign any portion of its rights or obligations hereunder to a Person engaged in the business of air transportation in competition with any Loan Party or any of its Subsidiaries without the prior written consent of such Loan Party.

 

(b)           Procedure. The parties to each Sale made in reliance on clause (a) above (other than those described in clause (e) below) shall execute and deliver to the Administrative Agent (which shall keep a copy thereof) an Assignment, together with any existing Note subject to such Sale (or any affidavit of loss therefor acceptable to the Administrative Agent), any documentation required to be delivered pursuant to Section 1.10(c) (which shall also be delivered to the Borrower) and payment by the assignee of an assignment fee in the amount of [*]. Upon receipt of all the foregoing, and conditioned upon such receipt and upon the Administrative Agent consenting to such Assignment, from and after the effective date specified in such Assignment, the Administrative Agent, acting for this purpose as an agent of the Borrower, shall record or cause to be recorded in a register held at one of its offices (the “Register”) information contained in such Assignment.

 

(c)           Effectiveness. Effective upon the entry of such record in the Register, (i) such assignee shall become a party hereto and, to the extent that rights and obligations under the Loan Documents have been assigned to such assignee pursuant to such Assignment, shall have the rights and obligations of a Lender, (ii) any applicable Note shall be transferred to such assignee through such entry and (iii) the assignor thereunder shall, to the extent that rights and obligations under this Agreement have been assigned by it pursuant to such Assignment, relinquish its rights (except for those surviving the termination of the Commitments and the payment in full of the Obligations) and be released from its obligations under the Loan Documents, other than those relating to events or circumstances occurring prior to such assignment, and, in the case of an Assignment covering all or the remaining portion of an assigning Lender’s rights and obligations under the Loan Documents, such Lender shall cease to be a party hereto.

 

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(d)           Grant of Security Interests. In addition to the other rights provided in this Section 9.1, each Lender may grant a security interest in, or otherwise assign as collateral, any of its rights under this Agreement, whether now owned or hereafter acquired (including rights to payments of principal or interest on the Loan), to (A) any federal reserve bank (pursuant to Regulation A of the Federal Reserve Board), without notice to the Administrative Agent or (B) any holder of, or trustee for the benefit of the holders of, such Lender’s Securities by notice to the Administrative Agent; provided, that no such holder or trustee, whether because of such grant or assignment or any foreclosure thereon (unless such foreclosure is made through an assignment in accordance with clause (b) above), shall be entitled to any rights of such Lender hereunder and no such Lender shall be relieved of any of its obligations hereunder.

 

(e)           Participants and SPVs. In addition to the other rights provided in this Section 9.1, each Lender may, (x) with notice to the Administrative Agent, grant to an SPV the option to maintain all or any part of the Loan that such Lender would otherwise be required to maintain hereunder (and the exercise of such option by such SPV and the maintaining of the Loan pursuant thereto shall satisfy the obligation of such Lender to maintain such Loan hereunder) and such SPV may assign to such Lender the right to receive payment with respect to any Obligation and (y) without notice to or consent from the Administrative Agent or the Borrower, sell participations to one or more Persons in or to all or a portion of its rights and obligations under the Loan Documents; provided, that, whether as a result of any term of any Loan Document or of such grant or participation, (i) no such SPV or participant shall have a commitment, or be deemed to have made an offer to commit, to make the Loan hereunder, and, except as provided in the applicable option agreement, none shall be liable for any obligation of such Lender hereunder, (ii) such Lender’s rights and obligations, and the rights and obligations of the Borrower towards such Lender, under any Loan Document shall remain unchanged and each other party hereto shall continue to deal solely with such Lender, which shall remain the holder of the Obligations in the Register, except that (A) each such participant and SPV shall be entitled to the benefit of Section 1.8, Section 1.10 and Section 1.11, but, in the case of Section 1.10, only to the extent any such participant or SPV that is a Foreign Person complies with Section 1.10(c) as if it were a Lender, and in each such case only to the extent of any amount to which such Lender would be entitled in the absence of any such grant or participation and (B) each such SPV may receive other payments that would otherwise be made to such Lender with respect to the Loan funded by such SPV to the extent provided in the applicable option agreement and set forth in a notice provided to the Administrative Agent by such SPV and such Lender; provided, that in no case (including pursuant to clause (A) or (B) above) shall an SPV or participant have the right to enforce any of the terms of any Loan Document, and (iii) the consent of such SPV or participant shall not be required (either directly, as a restraint on such Lender’s ability to consent hereunder or otherwise) for any amendments, waivers or consents with respect to any Loan Document or to exercise or refrain from exercising any powers or rights such Lender may have under or in respect of the Loan Documents (including the right to enforce or direct enforcement of the Obligations), except for those described in clauses (iii)(B) and (iii)(C) of Section 11.2(a) with respect to amounts, or dates fixed for payment of amounts, to which such participant or SPV would otherwise be entitled and, in the case of participants, except for those described in Section 11.2(a)(vii) (or amendments, consents and waivers to release all or substantially all of the Collateral). No party hereto shall institute against any SPV grantee of an option pursuant to this clause (e) any bankruptcy, reorganization, insolvency, liquidation or similar proceeding, prior to the date that is one year and one day after the payment in full of all outstanding commercial paper of such SPV; provided, however, that each Lender having designated an SPV as such agrees to indemnify each Indemnified Person against any Liability that may be incurred by, or asserted against, such Indemnified Person as a result of failing to institute such proceeding (including a failure to get reimbursed by such SPV for any such Liability). The agreement in the preceding sentence shall survive the termination of the Commitments and the payment in full of the Obligations.

 

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SECTION 9.2.        The Administrative Agent.

 

(a)           Appointment and Authorization.  Each Lender hereby irrevocably designates and appoints [*] as the “Administrative Agent” under the Loan Documents and authorizes the Administrative Agent to take such actions and to exercise such powers as are delegated to it thereby and to exercise such other powers as are reasonably incidental thereto.  The Administrative Agent shall not have any duties other than those expressly set forth in a Loan Document, or any fiduciary relationship with any Lender, and no implied obligations or liabilities shall be read into this Agreement, or otherwise exist, against the Administrative Agent.  The Administrative Agent does not assume, nor shall it be deemed to have assumed, any obligation to, or relationship of trust or agency with, the Borrower.  Notwithstanding any provision of this Agreement or any other Loan Document, in no event shall the Administrative Agent ever be required to take any action which exposes it to personal liability or which is contrary to the provision of any Loan Document or applicable law.

 

(b)           Delegation of Duties.  The Administrative Agent may execute any of its duties through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties.

 

(c)           Exculpatory Provisions.  Neither the Administrative Agent nor any of its respective directors, officers, agents or employees shall be liable to any Lender for any action taken or omitted (i) with the consent or at the direction of the Requisite Lenders or (ii) in the absence of such Person’s gross negligence or willful misconduct.  The Administrative Agent shall not be responsible to any Lender or other Person for (a) any recitals, representations, warranties or other statements made by the Borrower or any of its Affiliates, (b) the value, validity, effectiveness, genuineness, enforceability or sufficiency of any Loan Document, (c) any failure of the Borrower or any of its Affiliates to perform any obligation or (d) the satisfaction of any condition specified in Article 2.  The Administrative Agent shall not have any obligation to any Lender to ascertain or inquire about the observance or performance of any agreement contained in any Loan Document or to inspect the properties, books or records of the Borrower or any of its Affiliates.  The Administrative Agent shall not be responsible to any Lender or the Borrower for any determination concerning whether any Person is an Eligible Assignee.

 

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(d)           Reliance by Administrative Agent.  As between the Administrative Agent and the Lenders, the Administrative Agent shall in all cases be entitled to rely, and shall be fully protected in relying, upon any document, other writing or conversation reasonably believed by it to be genuine and correct and to have been signed, sent or made by the proper Person and upon advice and statements of legal counsel (including counsel to the Borrower or any of its Affiliates), independent accountants and other experts selected by the Administrative Agent.  The Administrative Agent shall in all cases be fully justified in failing or refusing to take any action under any Loan Document unless it shall first receive such advice or concurrence of the Lenders, and assurance of its indemnification, as it deems appropriate.  Subject to Section 11.2, the Administrative Agent shall not effect any waiver or grant any consent or make any determination (except as provided in Section 1.5) without the direction of the Requisite Lenders.

 

(e)           Notice of Events of Default.  The Administrative Agent shall not be deemed to have knowledge or notice of the occurrence of any Default unless it has received notice from any Lender or the Borrower stating that a Default has occurred hereunder and describing such Default.  Promptly upon receiving notice of the occurrence of any Default, the Administrative Agent shall notify each Lender of such occurrence.  The Administrative Agent shall take such action concerning a Default as may be directed by the Requisite Lenders (or, if required for such action, all of the Lenders), but until the Administrative Agent receives such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, as the Administrative Agent deems advisable and in the best interests of the Lenders.

 

(f)           Non-Reliance on Administrative Agent and Other Lenders; Lender Representations.  Each Lender expressly acknowledges that neither the Administrative Agent nor any of its respective officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any representations or warranties to it and that no act by the Administrative Agent hereafter taken, including any review of the affairs of the Borrower or any of its Affiliates, shall be deemed to constitute any representation or warranty by the Administrative Agent.  Each Lender represents and warrants to the Administrative Agent that, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, it has made and will continue to make its own appraisal of and investigation into the business, operations, property, prospects, financial and other conditions and creditworthiness of the Borrower and its own decision to enter into this Agreement and to take, or omit, action under any Loan Document.  Except for items specifically required to be delivered hereunder, the Administrative Agent shall not have any duty or responsibility to provide any Lender with any information concerning the Borrower or any of its Affiliates that comes into the possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates.

 

(g)           Administrative Agent and Affiliates.  Each of the Administrative Agent and its Affiliates may extend credit to, accept deposits from and generally engage in any kind of business with the Borrower or any of its Affiliates and, in its role as Lender, [*] may exercise or refrain from exercising its rights and powers as if it were not Administrative Agent.

 

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(h)           Indemnification.  Each Lender shall indemnify and hold harmless each of the Administrative Agent and its officers, directors, employees, representatives and agents (to the extent not reimbursed by the Borrower and without limiting the obligation of the Borrower to do so), ratably in accordance with its Pro Rata Share from and against any and all liabilities, obligations, losses, damages, penalties, judgments, settlements, costs, expenses and disbursements of any kind whatsoever (including in connection with any investigative or threatened proceeding, whether or not the Administrative Agent or such Person shall be designated a party thereto) that may at any time be imposed on, incurred by or asserted against the Administrative Agent or such Person as a result of, or related to, any of the transactions contemplated by the Loan Documents or the execution, delivery or performance of the Loan Documents or any other document furnished in connection therewith (but excluding any such liabilities, obligations, losses, damages, penalties, judgments, settlements, costs, expenses or disbursements resulting solely from the gross negligence or willful misconduct of the Administrative Agent or such Person as finally determined by a court of competent jurisdiction).

 

(i)            Successor Administrative Agent.  The Administrative Agent may, upon at least [*] days prior written notice to the Borrower and each Lender, resign its position as the Administrative Agent.  Such resignation shall not become effective until a successor Administrative Agent is appointed by the Requisite Lenders and has accepted such appointment.  Upon such acceptance of its appointment as the Administrative Agent hereunder by a successor Administrative Agent, such successor Administrative Agent shall succeed to and become vested with all the rights and duties of the retiring Administrative Agent, and the retiring Administrative Agent shall be discharged from its duties and obligations under the Loan Documents.  After any retiring Administrative Agent’s resignation hereunder, the provisions of Section 1.8 and this Section 9.2 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was the Administrative Agent.

 

ARTICLE 10

 

SUCCESSORS AND ASSIGNS

 

This Agreement and the other Loan Documents shall be binding on and shall inure to the benefit of the Loan Parties, the Administrative Agent, the Lenders and their respective successors and assigns, except as otherwise provided herein or therein. The Loan Parties may not assign, transfer, hypothecate or otherwise convey their rights, benefits, obligations or duties hereunder or under any of the other Loan Documents without the prior express written consent of the Administrative Agent and the Lenders. Any such purported assignment, transfer, hypothecation or other conveyance by the Loan Parties without the prior express written consent of the Administrative Agent and Lenders shall be void. The terms and provisions of this Agreement are for the purpose of defining the relative rights and obligations of the Loan Parties, the Administrative Agent and Lenders with respect to the transactions contemplated hereby and no Person shall be a third party beneficiary of any of the terms and provisions of this Agreement or any of the other Loan Documents.

 

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ARTICLE 11

 

MISCELLANEOUS

 

SECTION 11.1.      Complete Agreement; Modification of Agreement.

 

The Loan Documents constitute the complete agreement between the parties with respect to the subject matter thereof and may not be modified, altered or amended except as set forth in Section 11.2. Any letter of interest, commitment letter, fee letter or confidentiality agreement, if any, between the Borrower and the Administrative Agent or any Lender or any of their respective Affiliates, predating this Agreement and relating to a financing of substantially similar form, purpose or effect shall be superseded by this Agreement.

 

SECTION 11.2.      Amendments and Waivers.

 

(a)           Except as otherwise expressly provided in this Agreement, the Requisite Lenders (or the Administrative Agent with the prior written consent of the Requisite Lenders), on the one hand, and the Loan Parties, on the other hand, may from time to time enter into written amendments, supplements or modifications for the purpose of adding, deleting or modifying any provision of any Loan Document or changing in any manner the rights, remedies, obligations and duties of the parties thereto, and with the written consent of the Requisite Lenders, the Administrative Agent, on behalf of the Lenders, may execute and deliver a written instrument waiving, on such terms and conditions as may be specified in such instrument, any of the requirements applicable to the Loan Parties, or any Default or Event of Default and its consequences; provided, that:

 

(i)             no amendment, waiver or consent shall, unless in writing and signed by the Administrative Agent and the Requisite Lenders affect the rights or duties of the Administrative Agent under this Agreement or the other Loan Documents; and

 

(ii)            the Administrative Agent may, with the prior written consent of the Borrower, amend, modify or supplement any Loan Document to cure any ambiguity, typographical error, defect or inconsistency;

 

provided, further, that without the prior written consent (in addition to Lenders required above to take such action) of each Lender directly affected thereby, no such amendment, supplement, modification or waiver shall be effective to:

 

(iii)           (A) modify the Commitment of such Lender or subject such Lender to any additional obligation, (B) extend any scheduled final maturity of the Loan, (C) waive or reduce, or postpone or cancel any scheduled date fixed for the payment of (it being understood that any mandatory prepayment required under Section 1.2(b) does not constitute any scheduled date fixed for payments), principal of or interest on the Loan or any fees owing to such Lender, (D) reduce, or release any Loan Party from its obligations to repay, any other Obligation owed to such Lender or (E) consent to the assignment or transfer by any Loan Party of any of its rights and obligations under this Agreement;

 

(iv)           amend, modify or waive any provision of Section 1.2 or 1.3;

 

(v)           subordinate any of the Obligations or Liens securing the Obligations, except as permitted by this Agreement or any other Loan Document; or

 

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(vi)           (A) amend, modify or waive this Section 11.2 or any other provision specifying the Administrative Agent, Lenders or group of Lenders required for any amendment, modification or waiver thereof or (B) change the respective percentages specified in the definition of “Requisite Lenders”;

 

provided, further, that no such amendment, supplement, modification or waiver shall be effective to, without the prior written consent of all Lenders:

 

(vii)          release or permit the Loan Parties to sell or otherwise dispose of all or substantially all of the Collateral provided for in the Collateral Documents; provided, however, that no waiver, amendment, supplement or modification shall be required for the Administrative Agent to take additional Collateral pursuant to any Loan Document or to release any Collateral to the extent any Loan Document expressly permits the sale, assignment, lease, transfer, release, conveyance or other disposition of such Collateral.

 

(b)           Any waiver, amendment, supplement or modification pursuant to this Section 11.2 shall apply equally to each of the Lenders and shall be binding upon Lenders and all future holders of any of the Loan, the Notes, and all other Obligations.

 

(c)           Upon the Termination Date, the Administrative Agent shall deliver to the Borrower termination statements, mortgage releases, reconveyances and other documents necessary or appropriate to evidence the termination of the Liens securing payment of the Obligations.

 

SECTION 11.3.      Fees and Expenses.

 

The Loan Parties shall be jointly and severally liable to the Administrative Agent for all reasonable and documented out-of-pocket fees, costs and expenses (including the reasonable and documented fees and expenses of all of its counsel, advisors, consultants, auditors, appraisers and tax advisors) incurred in connection with the negotiation, preparation and filing and/or recordation of the Loan Documents and incurred by it in connection with:

 

(a)           any amendment, modification or waiver of, or consent with respect to, or termination of, any of the Loan Documents or advice in connection with the administration of the Loan made pursuant hereto or its rights hereunder or thereunder;

 

(b)           any litigation, contest, dispute, suit, proceeding or action (whether instituted by the Administrative Agent, any Lender, the Loan Parties 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 commenced by or against any Loan Party or any other Person that may be obligated to the Administrative 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 Loan 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, bad faith or willful misconduct as finally determined by a court of competent jurisdiction;

 

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(c)           any attempt to enforce any remedies of the Administrative Agent or any Lender against the Loan Parties or any other Person that may be obligated to the Administrative 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 Loan during the pendency of one or more Events of Default;

 

(d)           any workout or restructuring of the Loan during the pendency of one or more Events of Default; and

 

(e)           efforts to (i) monitor the Loan or any of the other Obligations, (ii) evaluate, observe or assess any of the Loan Parties or their respective affairs, and (iii) verify, protect, evaluate, assess, appraise, collect, sell, liquidate or otherwise dispose of any of the Collateral, in each case pursuant to and in accordance with the terms of the Loan Documents; including, as to each of clauses (a) through (e), all reasonable and documented attorneys’ and 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 and documented 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 11.3, all of which shall be payable, promptly after receipt by the Borrower of reasonably detailed invoices therefor, by the  Loan Parties to the Administrative Agent and shall be part of the Obligations. Without limiting the generality of the foregoing, such expenses, costs, charges and fees may include: reasonable and documented fees, costs and expenses of accountants, 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; long distance telephone charges; air express charges; telegram or telecopy charges; secretarial overtime charges; charges for any E-System; and reasonable and documented expenses for travel, lodging and food paid or incurred in connection with the performance of such legal or other advisory services.

 

SECTION 11.4.      No Waiver.

 

The Administrative Agent’s or any Lender’s failure, at any time or times, to require strict performance by the Loan Parties of any provision of this Agreement or any other Loan Document shall not waive, affect or diminish any right of the Administrative Agent or such Lender thereafter to demand strict compliance and performance herewith or therewith. Any suspension or waiver of an Event of Default shall not suspend, waive or affect any other Event of Default whether the same is prior or subsequent thereto and whether the same or of a different type. Subject to the provisions of Section 11.2, none of the undertakings, agreements, warranties, covenants and representations of the Loan Parties contained in this Agreement or any of the other Loan Documents and no Default or Event of Default by the Loan Parties shall be deemed to have been suspended or waived by the Administrative Agent or any Lender, unless such waiver or suspension is by an instrument in writing signed by an officer of or other authorized employee of the Administrative Agent and the applicable Requisite Lenders and directed to the  Loan Parties specifying such suspension or waiver.

 

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SECTION 11.5.      Remedies.

 

The Administrative Agent’s and Lenders’ rights and remedies under this Agreement shall be cumulative and nonexclusive of any other rights and remedies that the Administrative Agent or any Lender may have under any other agreement, including the other Loan Documents, by operation of law or otherwise. Recourse to the Collateral shall not be required.

 

SECTION 11.6.      Severability.

 

Wherever possible, each provision of this Agreement and the other Loan Documents shall be interpreted in such a manner as to be effective and valid under applicable law, but if any provision of this Agreement or any other Loan Document shall be prohibited by or invalid under applicable law, such provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement or such other Loan Document.

 

SECTION 11.7.      Adjustments; Set-off.  (a) Except to the extent that this Agreement, any other Loan Document or a court order expressly provides for payments to be allocated to a particular Lender, if any Lender (a “Benefitted Lender”) shall receive any payment of all or part of the Obligations owing to it (other than in connection with an assignment made pursuant to Section 9.1), or receive any collateral in respect thereof (whether voluntarily or involuntarily, by set-off, pursuant to events or proceedings of the nature referred to in Section 8.1(d), or otherwise), in a greater proportion than any such payment to or collateral received by any other Lender, if any, in respect of the Obligations owing to such other Lender, such Benefitted Lender shall purchase for cash from the other Lenders a participating interest in such portion of the Obligations owing to each such other Lender, or shall provide such other Lenders with the benefits of any such collateral, as shall be necessary to cause such Benefitted Lender to share the excess payment or benefits of such collateral ratably with each of the Lenders; provided, however, that if all or any portion of such excess payment or benefits is thereafter recovered from such Benefitted Lender, such purchase shall be rescinded, and the purchase price and benefits returned, to the extent of such recovery, but without interest.

 

(b)           In addition to any rights and remedies of the Lenders provided by law, upon the occurrence and during the continuance of an Event of Default, each Lender shall have the right, without notice to any Loan Party, any such notice being expressly waived by each Loan Party to the extent permitted by applicable law, upon any Obligations becoming due and payable by any Loan Party (whether at the stated maturity, by acceleration or otherwise), to apply to the payment of such Obligations, by setoff or otherwise, any and all deposits (general or special, time or demand, provisional or final), in any currency, and any other credits, indebtedness or claims, in any currency, in each case whether direct or indirect, absolute or contingent, matured or unmatured, at any time held or owing by such Lender, any affiliate thereof or any of their respective branches or agencies to or for the credit or the account of any Loan Party.  Each Lender agrees promptly to notify the applicable Loan Party and the Administrative Agent after any such application made by such Lender, provided that the failure to give such notice shall not affect the validity of such application.

 

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SECTION 11.8.      Confidentiality.

 

The Administrative Agent and the Lenders agree to use commercially reasonable efforts (equivalent to the efforts the Administrative Agent or each Lender applies to maintain the confidentiality of its own confidential information) to maintain as confidential all confidential information provided to them by the Loan Parties and designated as confidential for a period of three (3) years following receipt thereof, except that each of the Administrative Agent and the Lenders may disclose such information (a) to Persons employed or engaged by the Administrative Agent or such Lender (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such information and instructed to keep such information confidential); (b) to any bona fide assignee or participant or potential assignee or participant that has agreed to comply with the covenant contained in this Section 11.8 (and any such bona fide assignee or participant or potential assignee or participant may disclose such information to Persons employed or engaged by them as described in clause (a) above); (c) as required or requested by any Governmental Authority or reasonably believed by the Administrative Agent or such Lender to be compelled by any court decree, subpoena or legal or administrative order or process (provided, that in the event of any such disclosure under this clause (c) or clause (d) below, the Administrative Agent or such Lender, as the case may be, agrees to use commercially reasonable efforts to inform the Borrower of such disclosure to the extent not prohibited by applicable law); (d) as, on the advice of the Administrative Agent’s or such Lender’s counsel, is required by law; (e) in connection with the exercise of any right or remedy under the Loan Documents or in connection with any Litigation to which the Administrative Agent or such Lender is a party related to the Loan Documents or the Loan or other Obligations thereunder; (f) that ceases to be confidential through no fault of the Administrative Agent or such Lender; and (g) to its affiliates and its and their directors, officers, employees, advisors, representatives or agents (it being understood that the Persons to whom such disclosure is made will be informed of the confidential nature of such information and instructed to keep such information confidential).

 

SECTION 11.9.      GOVERNING LAW.

 

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