CREDIT AGREEMENT

Exhibit 10.1

 

CREDIT AGREEMENT

by and among

STREAM GLOBAL SERVICES, INC.

as Parent,

EACH OF PARENT’S SUBSIDIARIES THAT ARE SIGNATORY HERETO

as the Borrowers,

THE LENDERS THAT ARE SIGNATORIES HERETO

as the Lenders,

and

WELLS FARGO FOOTHILL, LLC

as the Agent, and

WELLS FARGO FOOTHILL, LLC AND GOLDMAN SACHS LENDING PARTNERS LLC,

as the Arrangers

Dated as of October 1, 2009

 

TABLE OF CONTENTS

 

 

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TABLE OF CONTENTS

(cont’d.)

 

 

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TABLE OF CONTENTS

(cont’d.)

 

 

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TABLE OF CONTENTS

(cont’d.)

 

 

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EXHIBITS AND SCHEDULES

 

 

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CREDIT AGREEMENT

THIS CREDIT AGREEMENT (this “ Agreement ”), is entered into as of October 1, 2009 by and among the lenders identified on the signature pages hereof (such lenders, together with their respective successors and permitted assigns, are referred to hereinafter each individually as a “ Lender ” and collectively as the “ Lenders ”), WELLS FARGO FOOTHILL, LLC , a Delaware limited liability company (“ WFF ”), as agent for the Lenders (in such capacity, together with its successors and assigns in such capacity, “ Agent ”), WFF and GOLDMAN SACHS LENDING PARTNERS LLC , as co-arrangers (the “ Arrangers ”), STREAM GLOBAL SERVICES, INC. , a Delaware corporation (“ Parent ”), and each of Parent’s Subsidiaries identified on the signature pages hereof (such Subsidiaries, together with Parent and any other Person that becomes a Borrower pursuant to Section 3.8 hereof, are referred to hereinafter each individually as a “ Borrower ,” and individually and collectively, jointly and severally, as the “ Borrowers ”).

The parties agree as follows:

SECTION 1. DEFINITIONS AND CONSTRUCTION.

1.1. Definitions . Capitalized terms used in this Agreement shall have the meanings specified therefor on Schedule 1.1 .

1.2. Accounting Terms. All accounting terms not specifically defined herein shall be construed in accordance with GAAP; provided , however , that if U.S. Administrative Borrower notifies Agent that the Borrowers request an amendment to any provision hereof to eliminate the effect of any Accounting Change occurring after the Closing Date or in the application thereof on the operation of such provision (or if Agent notifies U.S. Administrative Borrower that the Required Lenders request an amendment to any provision hereof for such purpose), regardless of whether any such notice is given before or after such Accounting Change or in the application thereof, then Agent and the Borrowers agree that they will negotiate in good faith amendments to the provisions of this Agreement that are directly affected by such Accounting Change with the intent of having the respective positions of the Lenders and the Borrowers after such Accounting Change conform as nearly as possible to their respective positions as of the date of this Agreement and, until any such amendments have been agreed upon, the provisions in this Agreement shall be calculated as if no such Accounting Change had occurred. When used herein, the term “financial statements” shall include the notes and schedules thereto. Whenever the term “Borrowers” or the term “Parent” is used in respect of a financial covenant or a related definition, it shall be understood to mean Parent and its Subsidiaries on a consolidated basis, unless the context clearly requires otherwise.

1.3. Code . Any terms used in this Agreement that are defined in the Code shall be construed and defined as set forth in the Code unless otherwise defined herein; provided , however , that to the extent that the Code is used to define any term herein and such term is defined differently in different Articles of the Code, the definition of such term contained in Article 9 of the Code shall govern.

1.4. Construction . Unless the context of this Agreement or any other Loan Document clearly requires otherwise, references to the plural include the singular, references to the singular include the plural, the terms “includes” and “including” are not limiting, and the term “or” has, except where otherwise indicated, the inclusive meaning represented by the phrase “and/or.” The words “hereof,” “herein,” “hereby,” “hereunder,” and similar terms in this Agreement or any other Loan Document refer to this Agreement or such other Loan Document, as the case may be, as a whole and not to any particular provision of this Agreement or such other Loan Document, as the case may be. Section, subsection, clause, schedule, and exhibit references herein are to this Agreement unless otherwise specified. Any reference in this Agreement or in any other Loan Document to any agreement, instrument, or document shall include all alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements, thereto and thereof, as applicable (subject to any restrictions on such alterations, amendments, changes, extensions, modifications, renewals, replacements, substitutions, joinders, and supplements set forth herein). The words

“asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts, and contract rights. Any reference herein or in any other Loan Document to the satisfaction, repayment or payment in full of the Obligations (or, with respect to the Intercompany Subordination Agreement, the Senior Debt, as defined therein) shall mean the repayment in full in the full amount of Dollars expressed to be payable to Agent or any member of the Lender Group under this Agreement or the other Loan Documents (or, in the case of Letters of Credit or Bank Products, providing Letter of Credit Collateralization) of all Obligations (or, with respect to the Intercompany Subordination Agreement, the Senior Debt) other than unasserted contingent indemnification and reimbursement Obligations and other than any Bank Product Obligations that, at such time, are allowed by the applicable Bank Product Provider to remain outstanding and that are not required by the provisions of this Agreement to be repaid or cash collateralized. Any reference herein to any Person shall be construed to include such Person’s successors and assigns. Any requirement of a writing contained herein or in any other Loan Document shall be satisfied by the transmission of a Record. Any reference herein or, unless otherwise expressly provided therein, in any other Loan Document to the knowledge of a Loan Party, or words of like import, shall mean the actual knowledge of any of the chairman of the board, chief executive officer, president, chief financial officer, chief legal officer, treasurer, controller or other executive officer of such Loan Party.

1.5. Schedules and Exhibits . All of the schedules and exhibits attached to this Agreement shall be deemed incorporated herein by reference.

1.6. Currency Matters . Unless otherwise expressly provided herein, all calculations, comparisons, measurements or determinations under this Agreement shall be made in Dollars. For the purposes of such calculations, comparisons, measurements and determinations, any amount denominated in a currency other than Dollars shall be deemed to equal the Dollar Equivalent thereof (rounded upward to the nearest $0.01), as determined by Agent, based on the Exchange Rate for such currency at such time of determination. For avoidance of doubt, it is understood and agreed that all Advances and Letters of Credit shall be made or denominated in Dollars and all payments of amounts under the Loan Documents shall be made in Dollars; provided , however , at the Agent’s, Issuing Lender’s and Underlying Issuer’s election, Letters of Credit may, if requested by an Administrative Borrower, be issued in Canadian dollars.

1.7. Timing as to Foreign Advances . If the Foreign Designated Account is not maintained with a bank located in the United States, all references to time frames for funding of Foreign Advances to the Foreign Designated Account shall not apply and Agent and the Lenders shall instead provide Foreign Advances as soon as practicable.

SECTION 2. LOAN AND TERMS OF PAYMENT.

2.1. Revolver Advances .

(a) (i) U.S. Revolver Advances . Subject to the terms and conditions of this Agreement, and during the term of this Agreement, each Lender with a Revolver Commitment agrees (severally, not jointly or jointly and severally) to make advances (“ U.S. Advances ”) to the U.S. Borrowers in an aggregate amount at any one time outstanding not to exceed such Lender’s Pro Rata Share of an amount equal to the lesser of (i) the U.S. Maximum Revolver Amount less the U.S. Letter of Credit Usage at such time, and (ii) the U.S. Borrowing Base less the U.S. Letter of Credit Usage at such time; provided that the aggregate amount of U.S. Advances outstanding at any one time with respect to Eligible U.S. Accounts and Unbilled Eligible U.S. Accounts of Stream BV together with all outstanding Foreign Advances (other than those made with respect to Eligible Foreign Accounts and Unbilled Eligible Foreign Accounts of Stream Canada) with respect to Eligible Foreign Accounts and Unbilled Eligible Foreign Accounts shall not exceed, at any one time, $50,000,000. For avoidance of doubt, the aggregate outstanding Foreign Revolver Usage and U.S. Revolver Usage may not exceed the Maximum Revolver Amount.

 

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(ii) Foreign Revolver Advances. Subject to the terms and conditions of this Agreement, and during the term of this Agreement, each Lender with a Revolver Commitment agrees (severally, not jointly or jointly and severally) to make advances (“ Foreign Advances ”) to the Foreign Borrowers in an aggregate amount at any one time outstanding (exclusive of Foreign Advances outstanding with respect to Eligible Foreign Accounts and Unbilled Eligible Foreign Accounts of Stream Canada) not to exceed such Lender’s Pro Rata Share of an amount equal to the lesser of (i) the Foreign Maximum Revolver Amount less the Foreign Letter of Credit Usage at such time, and (ii) the Foreign Borrowing Base less the Foreign Letter of Credit Usage at such time; provided that the amount of Foreign Advances outstanding at any one time with respect to Eligible Foreign Accounts and Unbilled Eligible Foreign Accounts of (x) Stream UK shall not exceed $10,000,000, (y) Stream Canada shall not exceed $10,000,000, and (z) the Philippines Entities shall not in the aggregate exceed $30,000,000. For avoidance of doubt, the aggregate outstanding Foreign Revolver Usage and U.S. Revolver Usage may not exceed the Maximum Revolver Amount.

(b) Amounts borrowed pursuant to this Section 2.1 may be repaid and, subject to the terms and conditions of this Agreement, reborrowed at any time during the term of this Agreement. The outstanding principal amount of the Advances, together with interest accrued thereon, shall be due and payable on the Maturity Date or, if earlier, on the date on which they are declared due and payable pursuant to the terms of this Agreement.

(c) Anything to the contrary in this Section 2.1 notwithstanding, Agent shall have the right to establish reserves against the U.S. Borrowing Base or the Foreign Borrowing Base, as applicable, in such amounts, and with respect to such matters, as Agent in its Permitted Discretion shall deem necessary or appropriate, including reserves in the amount of or with respect to (i) sums that Parent or any of its Subsidiaries are required to pay under any Section of this Agreement or any other Loan Document (such as taxes, assessments, insurance premiums, or, in the case of leased assets, rents or other amounts payable under such leases) and have failed to pay when due (after giving effect to any applicable grace periods), (ii) amounts owing by Parent or any of its Subsidiaries to any Person to the extent secured by a Lien on, or trust (including deemed trusts) over, any of the Collateral, which Lien or trust, in the Permitted Discretion of Agent likely would have a priority superior to Agent’s Liens (such as Liens or trusts in favor of landlords, warehousemen, carriers, mechanics, materialmen, laborers, or suppliers, or Liens or trusts for ad valorem, excise, sales, or other taxes where given priority under Applicable Law) in and to such item of the Collateral, (iii) amounts subject to “ring-fencing” requirements under the Insolvency (Northern Ireland) Order 2005, (iv) if a Financial Covenant Period shall exist or Agent shall have determined, in its Permitted Discretion, that an Event of Default under Section 8.4 or 8.5 may reasonably be expected to occur within 30 days, then, at the Agent’s election, an amount equal to the aggregate amount of Eligible Foreign Accounts and Unbilled Eligible Foreign Accounts of the Philippines Entities contributed to the Foreign Borrowing Base during the 30-day period immediately prior to such date of determination (determined on a rolling basis while such reserve remains in place) and (v) Priority Payables; provided , however , unless an Event of Default shall have occurred and be continuing, Agent shall not reserve for any payments of interest or premium, if any, due with respect to the Indebtedness under the Indenture Documents. Agent will agree to use reasonable efforts to notify Parent of the implementation or, or increase in, a reserve at the time such reserve is implemented, but failure to provide such notice shall not impair Agent’s right to implement or increase a reserve or result in any liability to Agent of any kind.

(d) Minimum Dutch Borrowing. Notwithstanding anything herein to the contrary and except as otherwise provided in Section 13.1(k) , the minimum first borrowing from any Lender to each Dutch Borrower shall, at the time of first borrowing, be at least equal to the Dollar Equivalent (or equivalent in any other applicable currency) of EUR 50,000.

 

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2.2. [ Intentionally Omitted ]

2.3. Borrowing Procedures and Settlements.

(a) Procedure for Borrowing. Each Borrowing shall be made by a written request by an applicable Authorized Person delivered to Agent on behalf of U.S. Administrative Borrower in respect of U.S. Advances and on behalf of Foreign Administrative Borrower in respect of Foreign Advances. Unless Swing Lender is not obligated to make a Swing Loan pursuant to Section 2.3(b) below, such notice must be received by Agent no later than 1:00 p.m. (New York time) on the Business Day that is the requested Funding Date specifying (i) the amount of such Borrowing, and (ii) the requested Funding Date, which shall be a Business Day; provided , however , that if Swing Lender is not obligated to make a Swing Loan as to a requested Borrowing, such notice must be received by Agent no later than 1:00 p.m. (New York time) on the Business Day prior to the date that is the requested Funding Date. At Agent’s election, in lieu of delivering the above-described written request, any applicable Authorized Person on behalf of the applicable Administrative Borrower may give Agent telephonic notice of such request by the required time. In such circumstances, each Borrower agrees that any such telephonic notice will be confirmed in writing within 24 hours of the giving of such telephonic notice, but the failure to provide such written confirmation shall not affect the validity of the request.

(b) Making of Swing Loans. In the case of a request for an Advance and so long as either (i) the aggregate amount of Swing Loans made since the last Settlement Date, minus the amount of the applicable Loan Parties’ Collections or payments applied to Swing Loans since the last Settlement Date, plus the amount of the requested Advance does not exceed $15,000,000, or (ii) Swing Lender, in its sole discretion, shall agree to make a Swing Loan notwithstanding the foregoing limitation, Swing Lender shall make an Advance in the amount of such Borrowing (any such Advance made solely by Swing Lender pursuant to this Section 2.3(b) being referred to as a “ Swing Loan ” and such Advances being referred to collectively as “ Swing Loans ”) available to the applicable Borrowers on the Funding Date applicable thereto by transferring immediately available funds to the applicable Designated Account. Each Swing Loan shall be deemed to be an Advance hereunder and shall be subject to all the terms and conditions (including Section 3 ) applicable to other Advances, except that all payments on any Swing Loan shall be payable to Swing Lender solely for its own account. Subject to the provisions of Section 2.3(d)(i) , Swing Lender shall not make and shall not be obligated to make any Swing Loan if Swing Lender has actual knowledge that (i) one or more of the applicable conditions precedent set forth in Section 3 will not be satisfied on the requested Funding Date for the applicable Borrowing, or (ii) the requested Borrowing would exceed the amount permitted to be borrowed pursuant to Section 2.1(a) as an Advance on such Funding Date. Swing Lender shall not otherwise be required to determine whether the applicable conditions precedent set forth in Section 3 have been satisfied on the Funding Date applicable thereto prior to making any Swing Loan. The Swing Loans shall be secured by Agent’s Liens, constitute Obligations hereunder, and bear interest at the rate applicable from time to time to Advances that are Base Rate Loans.

(c) Making of Loans.

(i) In the event that Swing Lender is not obligated to make a Swing Loan, promptly after receipt of a request for a Borrowing pursuant to Section 2.3(a) , Agent shall notify the Lenders, not later than 4:00 p.m. (New York time) on the Business Day immediately preceding the Funding Date applicable thereto, by telecopy, telephone, or other similar form of transmission, of the requested Borrowing. Each Lender shall make the amount of such Lender’s Pro Rata Share of the requested Borrowing available to Agent in immediately available funds, to Agent’s Account, not later than 1:00 p.m. (New York time) on the Funding Date applicable thereto. After Agent’s receipt of the proceeds of such Advances, Agent shall make the proceeds thereof available to the applicable Borrowers on the applicable Funding Date by transferring immediately available funds equal to such proceeds received by Agent to the applicable Designated Account; provided , however , that, subject to the provisions of Section 2.3(d)(ii) , Agent shall not request any Lender to make, and no Lender shall have the obligation to make, any Advance if (1) one or more of the applicable conditions precedent set forth in Section 3 will not be satisfied on the requested Funding Date for the applicable Borrowing unless such condition has been waived, or (2) the requested Borrowing would exceed the amount permitted to be borrowed pursuant to Section 2.1(a) as a U.S. Advance or Foreign Advance, as applicable, on such Funding Date.

 

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(ii) Unless Agent receives notice from a Lender prior to 12:00 p.m. (New York time) on the date of a Borrowing, that such Lender will not make available as and when required hereunder to Agent for the account of the Borrowers the amount of that Lender’s Pro Rata Share of the Borrowing, Agent may assume that each Lender has made or will make such amount available to Agent in immediately available funds on the Funding Date and Agent may (but shall not be so required), in reliance upon such assumption, make available to the Borrowers on such date a corresponding amount. If any Lender shall not have made its full amount available to Agent in immediately available funds and if Agent in such circumstances has made available to the Borrowers such amount, that Lender shall on the Business Day following such Funding Date make such amount available to Agent, together with interest at the Defaulting Lender Rate for each day during such period. A notice submitted by Agent to any Lender with respect to amounts owing under this Section 2.3(c)(ii) shall be conclusive, absent manifest error. If such amount is so made available, such payment to Agent shall constitute such Lender’s Advance on the date of Borrowing for all purposes of this Agreement. If such amount is not made available to Agent on the Business Day following the Funding Date, Agent will notify the applicable Administrative Borrower of such failure to fund and, upon demand by Agent, the Borrowers shall pay such amount to Agent for Agent’s account, together with interest thereon for each day elapsed since the date of such Borrowing, at a rate per annum equal to the interest rate applicable at the time to the Advances composing such Borrowing. The failure of any Lender to make any Advance on any Funding Date shall not relieve any other Lender of any obligation hereunder to make an Advance on such Funding Date, but no Lender shall be responsible for the failure of any other Lender to make the Advance to be made by such other Lender on any Funding Date.

(iii) Agent shall not be obligated to transfer to a Defaulting Lender any payments (including, without limitation, any voluntary prepayments or any indemnification payments) made by any Borrower to Agent for the Defaulting Lender’s benefit (or any Collections or proceeds of Collateral that would otherwise be remitted hereunder to the Defaulting Lender), and, in the absence of such transfer to the Defaulting Lender, Agent shall transfer any such payments (A) first, to Swing Lender to the extent of any Swing Loans that were made by Swing Lender and that were required to be, but were not, repaid by the Defaulting Lender, (B) second, to the Issuing Lender, to the extent of the portion of a Letter of Credit Disbursement that was required to be, but was not, repaid by the Defaulting Lender, (C) third, to each non-Defaulting Lender ratably in accordance with their Commitments (but, in each case, only to the extent that such Defaulting Lender’s portion of an Advance (or other funding obligation) was funded by such other non-Defaulting Lender), and (D) fourth, to a suspense account maintained by Agent, the proceeds of which shall be retained and may be made available to be re-advanced to the Borrowers as if such Defaulting Lender had made its portion of Advances (or other funding obligations) to the Borrowers. Subject to the foregoing, Agent may hold and, in its Permitted Discretion, re-lend to the Borrowers for the account of such Defaulting Lender the amount of all such payments received and retained by Agent for the account of such Defaulting Lender. Solely for the purposes of voting or consenting to matters with respect to the Loan Documents, such Defaulting Lender shall be deemed not to be a “Lender” and such Lender’s Commitment shall be deemed to be zero until such time as all of such Defaulting Lender’s defaulted obligations have been cured. This Section shall remain effective with respect to such Lender until (x) the Obligations under this Agreement shall have been declared or shall have become immediately due and payable, (y) the non-Defaulting Lenders, Agent, and the Borrowers shall have waived such Defaulting Lender’s default in writing, or (z) the Defaulting Lender makes its Pro Rata Share of the applicable Advance and pays to Agent all amounts owing by Defaulting Lender in respect thereof. The operation of this Section shall not be construed to increase or otherwise affect the Commitment of any Lender, to relieve or excuse the performance by such Defaulting Lender or any other Lender of its duties and obligations hereunder, or to relieve or excuse the performance by any Borrower of its duties and obligations hereunder to Agent or to the Lenders other than such Defaulting Lender. Any such failure to fund by any Defaulting Lender shall constitute a material breach by such Defaulting Lender of this Agreement and shall entitle the applicable Administrative Borrower at its option, upon written notice to Agent, to arrange for a substitute Lender to assume the Commitment of such Defaulting Lender, such substitute Lender to be

 

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reasonably acceptable to Agent. In connection with the arrangement of such a substitute Lender, the Defaulting Lender shall have no right to refuse to be replaced hereunder, and agrees to execute and deliver a completed form of Assignment and Acceptance in favor of the substitute Lender (and agrees that it shall be deemed to have executed and delivered such document if it fails to do so) subject only to being repaid its share of the outstanding Obligations (other than Bank Product Obligations, but including an assumption of its Pro Rata Share of the Letters of Credit) existing as of the time such Defaulting Lender became a Defaulting Lender without any premium or penalty of any kind whatsoever; provided , however , that any such assumption of the Commitment of such Defaulting Lender shall not be deemed to constitute a waiver of any of the Lender Groups’ or any Borrower’s rights or remedies against any such Defaulting Lender arising out of or in relation to such failure to fund.

(d) Protective Advances and Optional Overadvances.

(i) Any contrary provision of this Agreement notwithstanding, but subject to Section 2.3(d)(iv) , Agent hereby is authorized by the Borrowers and the Lenders, from time to time in Agent’s sole discretion, (A) after the occurrence and during the continuance of a Default or an Event of Default, or (B) at any time that any of the other applicable conditions precedent set forth in Section 3 are not satisfied, to make Advances to, or for the benefit of, the Borrowers on behalf of the Lenders that Agent, in its Permitted Discretion deems necessary or desirable (1) to preserve or protect the Collateral, or any portion thereof, or (2) to enhance the likelihood of repayment of the Obligations (other than the Bank Product Obligations) (any of the Advances described in this Section 2.3(d)(i) shall be referred to as “ Protective Advances ”).

(ii) Any contrary provision of this Agreement notwithstanding, but subject to Section 2.3(d)(iv) , the Lenders hereby authorize Agent or Swing Lender, as applicable, and either Agent or Swing Lender, as applicable, may, but is not obligated to, knowingly and intentionally, continue to make U.S. Advances and Foreign Advances (including Swing Loans) requested (or deemed requested where such amounts are, under the terms of the Loan Documents, chargeable to the Loan Accounts or, in the case of Letter of Credit Disbursements, converted to Advances) by the applicable Administrative Borrower to the Borrowers notwithstanding that an Overadvance exists or thereby would be created, so long as (A) with respect to U.S. Advances, after giving effect to such U.S. Advances, (1) the outstanding U.S. Revolver Usage does not exceed the U.S. Borrowing Base by more than $10,000,000, and (2) the outstanding U.S. Revolver Usage (except for and excluding amounts charged to the U.S. Loan Account for interest, fees, or Lender Group Expenses) does not exceed the U.S. Maximum Revolver Amount, and (B) with respect to Foreign Advances, after giving effect to such Foreign Advances, (1) the outstanding Foreign Revolver Usage does not exceed the Foreign Borrowing Base by more than $5,000,000, and (2) the outstanding Foreign Revolver Usage (except for and excluding amounts charged to the Foreign Loan Account for interest, fees, or Lender Group Expenses) does not exceed the Foreign Maximum Revolver Amount. In the event Agent obtains actual knowledge that the U.S. Revolver Usage or Foreign Revolver Usage, as applicable, exceeds the amounts permitted by the immediately foregoing provisions, regardless of the amount of, or reason for, such excess, Agent shall notify the Lenders as soon as practicable (and prior to making any (or any additional) intentional Overadvances (except for and excluding amounts charged to the applicable Loan Account for interest, fees, or Lender Group Expenses) unless Agent determines that any delay due to sending prior notice to the Lenders would result in imminent harm to the Collateral or its value), and the Lenders with Revolver Commitments thereupon shall, together with Agent, jointly determine the terms of arrangements that shall be implemented with the applicable Administrative Borrower intended to reduce, within a reasonable time, the outstanding principal amount of the Advances to the applicable Borrowers to an amount permitted by the preceding sentence. In such circumstances, if any Lender with a Revolver Commitment objects to the proposed terms of reduction or repayment of any Overadvance, the terms of reduction or repayment thereof shall be implemented according to the determination of the Required Lenders. In any event: (x) if any unintentional Overadvance remains outstanding for more than 30 days, unless otherwise agreed to by the Required Lenders, the applicable Borrowers shall immediately repay the applicable Advances in an amount sufficient to eliminate all such unintentional Overadvances, and (y) after the date all such Overadvances have been eliminated, there must be at least five consecutive days before intentional Overadvances are made. The foregoing provisions are meant for the benefit of the Lenders

 

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and Agent and are not meant for the benefit of Borrower, which shall continue to be bound by the provisions of Section 2.5 . Each Lender with a Revolver Commitment shall be obligated to settle with Agent as provided in Section 2.3(e) for the amount of such Lender’s Pro Rata Share of any unintentional Overadvances by Agent reported to such Lender, any intentional Overadvances made as permitted under this Section 2.3(d)(ii) , and any Overadvances resulting from the charging to the Loan Account of interest, fees, or Lender Group Expenses.

(iii) Each Protective Advance and each Overadvance shall be deemed to be an Advance hereunder (with each Protective Advance and each Overadvance to, or for the benefit of, a U.S. Borrower being a U.S. Advance and each Protective Advance and each Overadvance to, or for the benefit of, a Foreign Borrower being a Foreign Advance), except that no Protective Advance or Overadvance shall be eligible to be a LIBOR Rate Loan and, prior to Settlement therefor, all payments on the Protective Advances shall be payable to Agent solely for its own account. The Protective Advances and Overadvances shall be repayable on demand, secured by Agent’s Liens, constitute Obligations hereunder, and bear interest at the rate applicable from time to time to Advances that are Base Rate Loans. The ability of Agent to make Protective Advances is separate and distinct from its ability to make Overadvances and its ability to make Overadvances is separate and distinct from its ability to make Protective Advances. For the avoidance of doubt, the limitations on Agent’s ability to make Protective Advances do not apply to Overadvances and the limitations on Agent’s ability to make Overadvances do not apply to Protective Advances. The provisions of this Section 2.3(d) are for the exclusive benefit of Agent, Swing Lender, and the Lenders and are not intended to benefit any Borrower in any way.

(iv) Notwithstanding anything contained in this Agreement or any other Loan Document to the contrary: (A) no Overadvance or Protective Advance may be made by Agent if such U.S. Advance or Foreign Advance, as applicable, would cause the aggregate principal amount of Overadvances and Protective Advances outstanding to exceed an amount equal to ten percent (10%) of the Maximum Revolver Amount; and (B) to the extent any Protective Advance causes the aggregate Revolver Usage to exceed the Maximum Revolver Amount, each such Protective Advance shall be for Agent’s sole and separate account and not for the account of any Lender.

(e) Settlement. It is agreed that each Lender’s funded portion of the Advances is intended by the Lenders to equal, at all times, such Lender’s Pro Rata Share of the outstanding Advances. Such agreement notwithstanding, Agent, Swing Lender, and the other Lenders agree (which agreement shall not be for the benefit of any Borrower) that in order to facilitate the administration of this Agreement and the other Loan Documents, settlement among the Lenders as to the Advances, the Swing Loans, and the Protective Advances shall take place on a periodic basis in accordance with the following provisions:

(i) Agent shall request settlement (“ Settlement ”) with the Lenders on a weekly basis, or on a more frequent basis if so determined by Agent (1) on behalf of Swing Lender, with respect to the outstanding Swing Loans, (2) for itself, with respect to the outstanding Protective Advances, and (3) with respect to any Loan Parties’ Collections or payments received, as to each by notifying the Lenders by telecopy, telephone, or other similar form of transmission, of such requested Settlement, no later than 5:00 p.m. (New York time) on the Business Day immediately prior to the date of such requested Settlement (the date of such requested Settlement being the “ Settlement Date ”). Such notice of a Settlement Date shall include a summary statement of the amount of outstanding Advances, Swing Loans, and Protective Advances for the period since the prior Settlement Date. Subject to the terms and conditions contained herein (including Section 2.3(c)(iii) ): (y) if a Lender’s balance of the Advances (including Swing Loans and Protective Advances) exceeds such Lender’s Pro Rata Share of the Advances (including Swing Loans and Protective Advances) as of a Settlement Date, then Agent shall, by no later than 3:00 p.m. (New York time) on the Settlement Date, transfer in immediately available funds to a Deposit Account of such Lender (as such Lender may designate), an amount such that each such Lender shall, upon receipt of such amount, have as of the Settlement Date, its Pro Rata Share of the Advances (including Swing Loans and Protective Advances), and (z) if a Lender’s balance of the Advances (including Swing Loans and Protective Advances) is less than such Lender’s Pro Rata Share of the Advances (including Swing Loans and Protective Advances) as of a Settlement Date, such Lender shall no

 

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later than 3:00 p.m. (New York time) on the Settlement Date transfer in immediately available funds to Agent’s Account, an amount such that each such Lender shall, upon transfer of such amount, have as of the Settlement Date, its Pro Rata Share of the Advances (including Swing Loans and Protective Advances). Such amounts made available to Agent under clause (z) of the immediately preceding sentence shall be applied against the amounts of the applicable Swing Loans or Protective Advances and, together with the portion of such Swing Loans or Protective Advances representing Swing Lender’s Pro Rata Share thereof, shall constitute Advances of such Lenders. If any such amount is not made available to Agent by any Lender on the Settlement Date applicable thereto to the extent required by the terms hereof, Agent shall be entitled to recover for its account such amount on demand from such Lender together with interest thereon at the Defaulting Lender Rate.

(ii) In determining whether a Lender’s balance of the Advances, Swing Loans, and Protective Advances is less than, equal to, or greater than such Lender’s Pro Rata Share of the Advances, Swing Loans, and Protective Advances as of a Settlement Date, Agent shall, as part of the relevant Settlement, apply to such balance the portion of payments actually received in good funds by Agent with respect to principal, interest and fees payable by the Borrowers and allocable to the Lenders hereunder, and proceeds of Collateral.

(iii) Between Settlement Dates, Agent, to the extent Protective Advances or Swing Loans are outstanding, may pay over to Agent or Swing Lender, as applicable, any Collections or payments of any Loan Party received by Agent, that in accordance with the terms of this Agreement would be applied to the reduction of the Advances, for application to the Protective Advances or Swing Loans. Between Settlement Dates, Agent, to the extent no Protective Advances or Swing Loans are outstanding, may pay over to Swing Lender any Collections or payments received by Agent, that in accordance with the terms of this Agreement would be applied to the reduction of the Advances, for application to Swing Lender’s Pro Rata Share of the Advances. If, as of any Settlement Date, Collections or payments of any Loan Party received since the then immediately preceding Settlement Date have been applied to Swing Lender’s Pro Rata Share of the Advances other than to Swing Loans, as provided for in the previous sentence, Swing Lender shall pay to Agent for the accounts of the Lenders, and Agent shall pay to the Lenders, to be applied to the outstanding Advances of such Lenders, an amount such that each Lender shall, upon receipt of such amount, have, as of such Settlement Date, its Pro Rata Share of the Advances. During the period between Settlement Dates, Swing Lender with respect to Swing Loans, Agent with respect to Protective Advances, and each Lender (subject to the effect of agreements between Agent and individual Lenders) with respect to the Advances other than Swing Loans and Protective Advances, shall be entitled to interest at the applicable rate or rates payable under this Agreement on such Swing Loans, Protective Advances and other Advances, as the case may be, made by Swing Lender, Agent, or the Lenders, as applicable.

(f) Notation. Agent, as a non-fiduciary agent for the Borrowers, shall maintain (i) a register showing the principal amount of the U.S. Advances, owing to each Lender, including the Swing Loans owing to Swing Lender, and Protective Advances owing to Agent, and the interests therein of each Lender, from time to time and such register shall, absent manifest error, conclusively be presumed to be correct and accurate, and (ii) a register showing the principal amount of the Foreign Advances, owing to each Lender, including the Swing Loans owing to Swing Lender, and Protective Advances owing to Agent, and the interests therein of each Lender, from time to time and such register shall, absent manifest error, conclusively be presumed to be correct and accurate.

(g) Lenders’ Failure to Perform. All Advances (other than Swing Loans and Protective Advances) shall be made by the Lenders contemporaneously and in accordance with their Pro Rata Shares. It is understood that (i) no Lender shall be responsible for any failure by any other Lender to perform its obligation to make any Advance (or other extension of credit) hereunder, nor shall any Commitment of any Lender be increased or decreased as a result of any failure by any other Lender to perform its obligations hereunder, and (ii) no failure by any Lender to perform its obligations hereunder shall excuse any other Lender from its obligations hereunder.

 

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2.4. Payments; Reductions of Commitments; Prepayments .

(a) Payments by Borrowers.

(i) Except as otherwise expressly provided herein, all payments by the Borrowers shall be made to Agent’s Account for the account of the Lender Group and shall be made in immediately available funds, no later than 2:00 p.m. (New York time) on the date specified herein. Any payment received by Agent later than 2:00 p.m. (New York time) shall be deemed to have been received on the following Business Day and any applicable interest or fee shall continue to accrue until such following Business Day.

(ii) Unless Agent receives notice from the U.S. Administrative Borrower prior to the date on which any payment is due to the Lenders that the Borrowers will not make such payment in full as and when required, Agent may assume that the Borrowers have made (or will make) such payment in full to Agent on such date in immediately available funds and Agent may (but shall not be so required), in reliance upon such assumption, distribute to each Lender on such due date an amount equal to the amount then due such Lender. If and to the extent the Borrowers do not make such payment in full to Agent on the date when due, each Lender severally shall repay to Agent on demand such amount distributed to such Lender, together with interest thereon at the Defaulting Lender Rate for each day from the date such amount is distributed to such Lender until the date repaid.

(b) Apportionment and Application.

(i) So long as no Application Event has occurred and is continuing and except as otherwise provided with respect to Defaulting Lenders, all principal and interest payments shall be apportioned ratably among the Lenders (according to the unpaid principal balance of the Obligations to which such payments relate held by each Lender) and all payments of fees and expenses (other than fees or expenses that are for Agent’s separate account) shall be apportioned ratably among the Lenders having a Pro Rata Share of the type of Commitment or Obligation to which a particular fee or expense relates. All payments to be made hereunder by the Foreign Borrowers shall be remitted to Agent and all (subject to Section 2.4(b)(iv) ) such payments, and all proceeds of Collateral owned by Foreign Borrowers received by Agent, shall be applied, so long as no Application Event has occurred and is continuing, to reduce the balance of the Foreign Advances outstanding and, thereafter, to the Foreign Borrowers (to be wired in immediately available funds to the Foreign Designated Account) or such other Person entitled thereto under Applicable Law. All payments to be made hereunder by the U.S. Borrowers shall be remitted to Agent and all (subject to Section 2.4(b)(iv) ) such payments, and all proceeds of Collateral owned by U.S. Borrowers received by Agent, shall be applied, so long as no Application Event has occurred and is continuing, first, to reduce the balance of the U.S. Advances outstanding, second, to reduce the balance of Foreign Advances outstanding, thereafter, to the U.S. Borrowers (to be wired in immediately available funds to the U.S. Designated Account) or such other Person entitled thereto under Applicable Law.

(ii) At any time that an Application Event has occurred and is continuing and except as otherwise provided with respect to Defaulting Lenders, (x) all payments remitted to Agent by Foreign Borrowers and all proceeds of Collateral owned by any Foreign Borrower received by Agent shall be applied to the payment of the Foreign Obligations, and (y) all payments remitted to Agent by U.S. Borrowers and all proceeds of Collateral owned by any U.S. Borrower received by Agent shall be applied first, to the payment of the U.S. Obligations, and second, to the payment of the Foreign Obligations (commencing with clause (A) below again with respect thereto), in respect of each of clauses (x) and (y) above, in the following order:

(A) first , to pay any Lender Group Expenses (including cost or expense reimbursements included therein) or indemnities then due to Agent under the Loan Documents, until paid in full,

 

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(B) second , to pay any fees or premiums, if any, then due to Agent under the Loan Documents until paid in full,

(C) third , to pay interest due in respect of all Protective Advances until paid in full,

(D) fourth , to pay the principal of all Protective Advances until paid in full,

(E) fifth , ratably to pay any Lender Group Expenses (including cost or expense reimbursements included therein) or indemnities then due to any of the Lenders under the Loan Documents, until paid in full,

(F) sixth , ratably to pay any fees or premiums then due to any of the Lenders under the Loan Documents until paid in full,

(G) seventh , ratably to pay interest due in respect of the Advances (other than Protective Advances), and the Swing Loans until paid in full,

(H) eighth , without duplication, ratably (i) to pay the principal of all Swing Loans until paid in full, (ii) to pay the principal of all Advances until paid in full, (iii) to Agent, to be held by Agent, for the benefit of Issuing Lender (and for the ratable benefit of each of the Lenders that have an obligation under the Loan Documents to pay to Agent, for the account of the Issuing Lender, a share of each Letter of Credit Disbursement), as cash collateral in an amount up to 105% of the Letter of Credit Usage (which cash collateral shall be applied to the reimbursement of any Letter of Credit Disbursement as and when such disbursement occurs and, if a Letter of Credit expires undrawn or is returned to the Issuing Lender undrawn, the cash collateral held by Agent in respect of such Letter of Credit shall be reapplied pursuant to this Section 2.4(b)(ii) , beginning with clause (A) hereof), and (iv) up to the amount of the Bank Product Reserve established prior to the occurrence of, and not in contemplation of, the subject Application Event, ratably, to the Bank Product Providers on account of all amounts then due and payable in respect of Bank Product Obligations, with any balance to be paid to Agent, to be held by Agent, for the ratable benefit of the Bank Product Providers, as cash collateral (which cash collateral shall be applied, ratably, to the payment or reimbursement of any amounts due and payable with respect to such Bank Product Obligations as and when such amounts first become due and payable and, if any such Bank Product Obligation is paid or otherwise satisfied in full, the cash collateral held by Agent in respect of such Bank Product Obligation shall be reapplied pursuant to this Section 2.4(b)(ii) , beginning with tier (A) hereof),

(I) ninth , to pay any other Obligations, and

(J) tenth , to the Borrowers (to be wired to the applicable Designated Account) or such other Person entitled thereto under Applicable Law.

(iii) Agent promptly shall distribute to each Lender, pursuant to the applicable wire instructions received from each Lender in writing, such funds as it may be entitled to receive, subject to a Settlement delay as provided in Section 2.3(e) .

(iv) In each instance, so long as no Application Event has occurred and is continuing, Section 2.4(b)(i) shall not apply to any payment made by any Loan Party to Agent and specified by such Loan Party to be for the payment of specific Obligations then due and payable (or prepayable) under any provision of this Agreement or any other Loan Document.

 

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(v) For purposes of Section 2.4(b)(ii), “paid in full” means payment in cash of all amounts owing under the Loan Documents, including loan fees, service fees, professional fees, interest (and specifically including interest accrued after the commencement of any Insolvency Proceeding), default interest, interest on interest, and expense reimbursements, whether or not any of the foregoing would be or is allowed or disallowed in whole or in part in any Insolvency Proceeding.

(vi) In the event of a direct conflict between the priority provisions of this Section 2.4 and any other provision contained in any other Loan Document, it is the intention of the parties hereto that such provisions be read together and construed, to the fullest extent possible, to be in concert with each other. Except as otherwise provided in Section 17.15 , in the event of any actual, irreconcilable conflict that cannot be resolved as aforesaid, the terms and provisions of this Section 2.4 shall control and govern.

(c) Reduction of Revolver Commitments. The Revolver Commitments shall terminate on the Maturity Date. U.S. Administrative Borrower may reduce the U.S. Maximum Revolver Amount (with a corresponding reduction in the Revolver Commitments and the Maximum Revolver Amount), without premium or penalty, to an amount (which may be zero) not less than the sum of (A) the U.S. Revolver Usage as of such date, plus (B) the principal amount of all U.S. Advances not yet made as to which a request has been given by either Administrative Borrower under Section 2.3(a) , plus (C) the face amount of all U.S. Letters of Credit not yet issued as to which a request has been given by U.S. Administrative Borrower pursuant to Section 2.11(a) . Foreign Administrative Borrower may reduce the Foreign Maximum Revolver Amount, without premium or penalty, to an amount (which may be zero) that is not less than the sum of (A) the Foreign Revolver Usage as of such date, plus (B) the principal amount of all Foreign Advances not yet made as to which a request has been given by either Administrative Borrower under Section 2.3(a) , plus (C) the amount of all Foreign Letters of Credit not yet issued as to which a request has been given by Foreign Administrative Borrower pursuant to Section 2.11(a) . Each such reduction shall be in an amount which is not less than $5,000,000 (unless the Revolver Commitments are being reduced to zero and the amount of the Revolver Commitments in effect immediately prior to such reduction are less than $5,000,000), shall be made by providing not less than 5 Business Days prior written notice to Agent and shall be irrevocable unless such notice specifies it is conditional on the consummation of a refinancing or other transaction, in which case such notice shall be contingent on the consummation thereof, and may be revoked by either Administrative Borrower if such refinancing or other transaction fails to close. Once reduced, the Maximum Revolver Amount and the Revolver Commitments may not be increased. Each such reduction of the Maximum Revolver Amount shall reduce the Revolver Commitments of each Lender proportionately in accordance with its Pro Rata Share thereof.

(d) Optional Prepayments of Advances. The Borrowers may prepay the principal of any Advance at any time in whole or in part, without premium or penalty.

2.5. Overadvances . If, at any time or for any reason (other than as a result of an intentional Overadvance permitted to be made under this Agreement with respect to which Agent and/or the applicable Lenders have agreed is not immediately due and payable), the amount of Obligations owed by the Borrowers to the Lender Group pursuant to Section 2.1 or Section 2.11 is greater than any of the limitations set forth in Section 2.1 or Section 2.11 , as applicable (an “ Overadvance ”), the applicable Borrowers shall immediately pay to Agent, in cash, the amount of such excess, which amount shall be used by Agent to reduce the applicable Obligations in accordance with the priorities set forth in Section 2.4(b) . The Borrowers promise to pay the Obligations (including principal, interest, fees, costs, and expenses) in Dollars in full on the Maturity Date or, if earlier, on the date on which the Obligations are declared due and payable pursuant to the terms of this Agreement.

2.6. Interest Rates and Letter of Credit Fee: Rates, Payments, and Calculations .

(a) Interest Rates. Except as provided in Section 2.6(c) , all Obligations (except for undrawn Letters of Credit and except for Bank Product Obligations) that have been charged to the Loan Accounts pursuant to the terms hereof shall bear interest on the Daily Balance thereof as follows:

(i) if the relevant Obligation is a LIBOR Rate Loan, at a per annum rate equal to the LIBOR Rate plus the LIBOR Rate Margin, and

 

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(ii) otherwise, at a per annum rate equal to the Base Rate plus the Base Rate Margin.

(b) Letter of Credit Fee. The U.S. Borrowers shall pay Agent (for the ratable benefit of the Lenders with a Revolver Commitment, subject to any agreements between Agent and individual Lenders), a Letter of Credit fee (in addition to the charges, commissions, fees, and costs set forth in Section 2.11(e) ) which shall accrue at a per annum rate equal to the LIBOR Rate Margin then in effect less 0.50% per annum times the Daily Balance of the undrawn amount of all outstanding U.S. Letters of Credit. The Foreign Borrowers shall pay Agent (for the ratable benefit of the Lenders with a Revolver Commitment, subject to any agreements between Agent and individual Lenders), a Letter of Credit fee (in addition to the charges, commissions, fees, and costs set forth in Section 2.11(e) ) which shall accrue at a per annum rate equal to the LIBOR Rate Margin then in effect less 0.50% per annum times the Daily Balance of the undrawn amount of all outstanding Foreign Letters of Credit.

(c) Default Rate. Upon the occurrence and during the continuation of an Event of Default and at the election of the Required Lenders,

(i) all Obligations (except for undrawn Letters of Credit and except for Bank Product Obligations) that have been charged to the Loan Account pursuant to the terms hereof shall bear interest on the Daily Balance thereof at a per annum rate equal to 2 percentage points above the per annum rate otherwise applicable hereunder, and

(ii) the Letter of Credit fees provided for in Section 2.6(b) shall be increased to 2 percentage points above the per annum rate otherwise applicable hereunder.

(d) Payment. Except to the extent provided to the contrary in Section 2.10 or Section 2.12(a) , interest, Letter of Credit fees, all other fees payable hereunder or under any of the other Loan Documents, and all costs, expenses, and Lender Group Expenses payable hereunder or under any of the other Loan Documents shall be due and payable, in arrears, on the first day of each month at any time that Obligations or Commitments are outstanding; provided , that , if any such payment is due on a day which is not a Business Day, then the due date for such payment shall be deemed to be the immediately following Business Day (it being understood that in the case of a LIBOR Rate Loan, interest shall be payable as set forth in Section 2.12(a) . The Borrowers hereby authorize Agent, from time to time without prior notice to any Borrower, to charge all interest, Letter of Credit fees, and all other fees payable hereunder or under any of the other Loan Documents (in each case, as and when due and payable), all costs, expenses, and Lender Group Expenses payable hereunder or under any of the other Loan Documents (in each case, as and when incurred), all charges, commissions, fees, and costs provided for in Section 2.11(e) (as and when accrued or incurred), all fees and costs provided for in Section 2.10 (as and when accrued or incurred), and all other payments as and when due and payable under any Loan Document (including any amounts due and payable to the Bank Product Providers in respect of Bank Products up to the amount of the Bank Product Reserve) to the Loan Accounts, which amounts thereafter shall constitute U.S. Advances or Foreign Advances, as applicable, hereunder and shall accrue interest at the rate then applicable to Advances that are Base Rate Loans (unless and until converted into LIBOR Rate Loans in accordance with the terms hereof). Any interest, fees, costs, expenses, Lender Group Expenses, or other amounts payable hereunder or under any other Loan Document not paid when due shall be compounded by being charged to the Loan Accounts and shall thereafter constitute U.S. Advances or Foreign Advances, as applicable, hereunder and shall accrue interest at the rate then applicable to Advances that are Base Rate Loans (unless and until converted into LIBOR Rate Loans in accordance with the terms of this Agreement).

 

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(e) Computation. All interest and fees chargeable under the Loan Documents shall be computed on the basis of a 360 day year, in each case, for the actual number of days elapsed in the period during which the interest or fees accrue. In the event the Base Rate is changed from time to time hereafter, the rates of interest hereunder based upon the Base Rate automatically and immediately shall be increased or decreased by an amount equal to such change in the Base Rate.

(f) Intent to Limit Charges to Maximum Lawful Rate.

(i) In no event shall the interest rate or rates payable under this Agreement, plus any other amounts paid in connection herewith, exceed the highest rate permissible under any law that a court of competent jurisdiction shall, in a final determination, deem applicable. The Borrowers and the Lender Group, in executing and delivering this Agreement, intend legally to agree upon the rate or rates of interest and manner of payment stated within it; provided , however , that, anything contained herein to the contrary notwithstanding, if said rate or rates of interest or manner of payment exceeds the maximum allowable under Applicable Law, then, ipso facto , as of the date of this Agreement, the Borrowers are and shall be liable only for the payment of such maximum as allowed by law, and, to the extent not prohibited by Applicable Law, payment received from any Borrower in excess of such legal maximum, whenever received, shall be applied to reduce the principal balance of the Obligations to the extent of such excess.

(ii) Without derogating from Section 2.6(f)(i) , if any provision of this Agreement or of any of the other Loan Documents would obligate Stream Canada to make any payment of interest or other amount payable to any member of the Lender Group in an amount or calculated at a rate which would be prohibited by applicable law or would result in a receipt by such Person of interest at a criminal rate (as such terms are construed under the Criminal Code (Canada)) then, notwithstanding such provisions, such amount or rate shall be deemed to have been adjusted with retroactive effect to the maximum amount or rate of interest, as the case may be, as would not be so prohibited by applicable law or so result in a receipt by such Person of interest at a criminal rate, such adjustment to be effected, to the extent necessary, as follows: (A) firstly, by reducing the amount or rate of interest otherwise required to be paid to such Person under this Section 2.6 , and (B) thereafter, by reducing any fees, commissions, premiums and other amounts required to be paid to such Agent or such Lender which would constitute “interest” for purposes of Section 347 of the Criminal Code (Canada). Notwithstanding the foregoing, and after giving effect to all adjustments contemplated thereby, if any member of the Lender Group shall have received an amount in excess of the maximum permitted by that section of the Criminal Code (Canada), Stream Canada shall be entitled, by notice in writing to such Person, to obtain reimbursement from such Person in an amount equal to such excess and, pending such reimbursement, such amount shall be deemed to be an amount payable by such Person to Stream Canada. Any amount or rate of interest referred to in this Section 2.6(f)(ii) shall be determined in accordance with the equivalent of GAAP in Canada as an effective annual rate of interest over the term that the applicable Advance remains outstanding on the assumption that any charges, fees or expenses that fall within the meaning of “interest” (as defined in the Criminal Code (Canada)) shall, if they relate to a specific period of time, be pro-rated over that period of time and otherwise be pro-rated over the period from the Canadian Closing Date to the Maturity Date and, in the event of a dispute, the determination of Agent shall be conclusive absent manifest error.

(g) Interest Act (Canada) . For purposes of disclosure pursuant to the Interest Act (Canada), the annual rates of interest or fees to which the rates of interest or fees provided in this Agreement and the other Loan Documents (and stated herein or therein, as applicable, to be computed on the basis of a 360 day year or any other period of time less than a calendar year) are equivalent are the rates so determined multiplied by the actual number of days in the applicable calendar year and divided by 360 or the actual number of days in such other period of time, respectively.

 

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2.7. Crediting Payments . The receipt of any payment item by Agent shall not be considered a payment on account unless such payment item is a wire transfer of immediately available federal funds made to Agent’s Account or unless and until such payment item is honored when presented for payment. Should any payment item not be honored when presented for payment, then the Borrowers shall be deemed not to have made such payment and interest shall be calculated accordingly. Anything to the contrary contained herein notwithstanding, any payment item shall be deemed received by Agent only if it is received into Agent’s Account on a Business Day on or before 2:00 p.m. (New York time). If any payment item is received into Agent’s Account on a non-Business Day or after 2:00 p.m. (New York time) on a Business Day, it shall be deemed to have been received by Agent as of the opening of business on the immediately following Business Day.

2.8. Designated Accounts . Agent is authorized to make the Advances (including Swing Loans), and Issuing Lender is authorized to issue the Letters of Credit, under this Agreement based upon telephonic or other instructions received from anyone purporting to be an Authorized Person or, without instructions, if pursuant to Section 2.6(d) . U.S. Administrative Borrower agrees to establish and maintain the U.S. Designated Account with the U.S. Designated Account Bank for the purpose of receiving the proceeds of the U.S. Advances (including Swing Loans) requested by U.S. Administrative Borrower, on behalf of the U.S. Borrowers, and made by Agent or the Lenders hereunder. Unless otherwise agreed by Agent and U.S. Administrative Borrower, any U.S. Advance (including any Swing Loan) requested by U.S. Administrative Borrower, on behalf of any U.S. Borrower, and made by Agent or the Lenders hereunder shall be made to the U.S. Designated Account. Foreign Administrative Borrower agrees to establish and maintain the Foreign Designated Account with the Foreign Designated Account Bank for the purpose of receiving the proceeds of the Foreign Advances (including Swing Loans) requested by Foreign Administrative Borrower, on behalf of the Foreign Borrowers, and made by Agent or the Lenders hereunder. Unless otherwise agreed by Agent and Foreign Administrative Borrower, any Advance (including any Swing Loan) requested by Foreign Administrative Borrower, on behalf of any Foreign Borrower, and made by Agent or the Lenders hereunder shall be made to the Foreign Designated Account.

2.9. Maintenance of Loan Account; Statements of Obligations . Agent shall maintain accounts on its books in the name of the U.S. Borrowers (the “ U.S. Loan Account ”) and the Foreign Borrowers (the “ Foreign Loan Account ” and together with the U.S. Loan Account, the “ Loan Accounts ”) on which the U.S. Borrowers and the Foreign Borrowers will be charged with all applicable U.S. Advances and Foreign Advances (including Protective Advances and Swing Loans) made by Agent, Swing Lender, or the Lenders to Administrative Borrower or for any applicable Borrower’s account, the Letters of Credit issued or made by Issuing Lender for any applicable Borrower’s account, and with all other payment Obligations outstanding hereunder or under the other Loan Documents (except for Bank Product Obligations), including, accrued interest, fees and expenses, and Lender Group Expenses. In accordance with Section 2.7 , the applicable Loan Account will be credited with all payments received by Agent from any applicable Borrower or for any Borrower’s account. Agent shall render monthly statements regarding the Loan Accounts to Administrative Borrower, including principal, interest, fees, and including an itemization of all charges and expenses constituting Lender Group Expenses owing, and such statements, absent manifest error, shall be conclusively presumed to be correct and accurate and constitute an account stated between the Borrowers and the Lender Group unless, within 30 days after receipt thereof by U.S. Administrative Borrower, U.S. Administrative Borrower shall deliver to Agent written objection thereto describing the error or errors contained in any such statements.

 

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2.10. Fees .

(a) The applicable Borrowers shall pay to Agent, for the account of Agent or the applicable Lenders (as applicable), as and when due and payable under the terms of the Fee Letters, the fees set forth in the Fee Letters; and

(b) The U.S. Borrowers shall pay to Agent, for the ratable account of the Lenders, on the first day of each fiscal quarter from and after the Closing Date up to the first day of the fiscal quarter prior to the Payoff Date and on the Payoff Date, an unused line fee in an amount equal to the Unused Line Fee Percentage times the result of (i) the Maximum Revolver Amount, less (ii) the average Daily Balance of the Revolver Usage during the immediately preceding fiscal quarter (or portion thereof).

2.11. Letters of Credit .

(a) Subject to the terms and conditions of this Agreement, upon the request of either U.S. Administrative Borrower or Foreign Administrative Borrower made in accordance herewith, the Issuing Lender agrees to issue, or to cause an Underlying Issuer, as Issuing Lender’s agent, to issue, a requested Letter of Credit. If Issuing Lender, at its option, elects to cause an Underlying Issuer to issue a requested Letter of Credit, then Issuing Lender agrees that it will obligate itself to reimburse such Underlying Issuer (which may include, among, other means, by becoming an applicant with respect to such Letter of Credit or entering into undertakings which provide for reimbursements of such Underlying Issuer with respect to such Letter of Credit; each such obligation or undertaking, irrespective of whether in writing, a “ Reimbursement Undertaking ”) with respect to Letters of Credit issued by such Underlying Issuer. By submitting a request to Issuing Lender for the issuance of a Letter of Credit, the U.S. Administrative Borrower or the Foreign Administrative Borrower, as applicable, shall be deemed to have requested that Issuing Lender issue or that an Underlying Issuer issue the requested Letter of Credit and to have requested Issuing Lender to issue a Reimbursement Undertaking with respect to such requested Letter of Credit if it is to be issued by an Underlying Issuer (it being expressly acknowledged and agreed by each Borrower that such Borrower is and shall be deemed to be an applicant (within the meaning of Section 5-102(a)(2) of the Code) with respect to each Underlying Letter of Credit). Each request for the issuance of a Letter of Credit, or the amendment, renewal, or extension of any outstanding Letter of Credit, shall be made in writing by an Authorized Person and delivered to the Issuing Lender via hand delivery, telefacsimile, or other electronic method of transmission reasonably in advance of the requested date of issuance, amendment, renewal, or extension. Each such request shall be in form and substance reasonably satisfactory to the Issuing Lender and shall specify (i) the amount of such U.S. Letter of Credit or Foreign Letter of Credit, (ii) the date of issuance, amendment, renewal, or extension of such U.S. Letter of Credit or Foreign Letter of Credit, (iii) the expiration date of such U.S. Letter of Credit or Foreign Letter of Credit, (iv) the name and address of the beneficiary of the U.S. Letter of Credit or Foreign Letter of Credit, and (v) such other information (including, in the case of an amendment, renewal, or extension, identification of the U.S. Letter of Credit or Foreign Letter of Credit to be so amended, renewed, or extended) as shall be necessary to prepare, amend, renew, or extend such Letter of Credit. Anything contained herein to the contrary notwithstanding, the Issuing Lender may, but shall not be obligated to, issue or cause the issuance of a Letter of Credit or to issue a Reimbursement Undertaking in respect of an Underlying Letter of Credit, in either case, that supports the obligations of Parent or its Subsidiaries in respect of an employment contract. Each U.S. Borrower and Foreign Borrower agrees that this Agreement (along with the terms of the applicable application) will govern each Letter of Credit and its issuance. The Issuing Lender shall have no obligation to issue a Letter of Credit or a Reimbursement Undertaking in respect of an Underlying Letter of Credit, in either case, if any of the following would result after giving effect to the requested issuance:

(i) the U.S. Letter of Credit Usage would exceed the U.S. Borrowing Base less the aggregate outstanding amount of U.S. Advances, or

 

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(ii) the Foreign Letter of Credit Usage would exceed the Foreign Borrowing Base less the aggregate amount of Foreign Advances, or

(iii) the U.S. Letter of Credit Usage would exceed the U.S. Maximum Revolver Amount less the sum of (A) the aggregate amount of U.S. Advances and (B) the Bank Product Reserve, or

(iv) the Foreign Letter of Credit Usage would exceed the Foreign Maximum Revolver Amount less the sum of (A) the aggregate amount of Foreign Advances and (B) the Bank Product Reserve, or

(v) the Letter of Credit Usage would exceed $20,000,000.

Each Letter of Credit shall be in form and substance reasonably acceptable to the Issuing Lender, including the requirement that the amounts payable thereunder must be payable in Dollars. If Issuing Lender makes a payment under a Letter of Credit or an Underlying Issuer makes a payment under an Underlying Letter of Credit, the applicable Borrowers shall pay to Agent an amount equal to the applicable Letter of Credit Disbursement on the date such Letter of Credit Disbursement is made and, in the absence of such payment, the amount of the Letter of Credit Disbursement immediately and automatically shall be deemed to be a U.S. Advance or a Foreign Advance, as applicable, hereunder and, initially, shall bear interest at the rate then applicable to Advances that are Base Rate Loans. If a Letter of Credit Disbursement is deemed to be an Advance hereunder, the applicable Borrowers’ obligation to pay the amount of such Letter of Credit Disbursement to Issuing Lender shall be discharged and replaced by the resulting Advance. Promptly following receipt by Agent of any payment from any applicable Borrower pursuant to this paragraph, Agent shall distribute such payment to the Issuing Lender or, to the extent that Lenders have made payments pursuant to Section 2.11(b) to reimburse the Issuing Lender, then to such Lenders and the Issuing Lender as their interests may appear.

(b) Promptly following receipt of a notice of a Letter of Credit Disbursement pursuant to Section 2.11(a) , each Lender with a Revolver Commitment agrees to fund its Pro Rata Share of any Advance deemed made pursuant to Section 2.11(a) on the same terms and conditions as if the applicable Administrative Borrower, on behalf of the applicable Borrowers, had requested the amount thereof as a U.S. Advance or a Foreign Advance, as applicable, and Agent shall promptly pay to Issuing Lender the amounts so received by it from the Lenders. By the issuance of a Letter of Credit or a Reimbursement Undertaking (or an amendment to a Letter of Credit or a Reimbursement Undertaking increasing the amount thereof) and without any further action on the part of the Issuing Lender or the Lenders with Revolver Commitments, the Issuing Lender shall be deemed to have granted to each Lender with a Revolver Commitment, and each Lender with a Revolver Commitment shall be deemed to have purchased, a participation in each Letter of Credit issued by Issuing Lender and each Reimbursement Undertaking, in an amount equal to its Pro Rata Share of such Letter of Credit or Reimbursement Undertaking, and each such Lender agrees to pay to Agent, for the account of the Issuing Lender, such Lender’s Pro Rata Share of any Letter of Credit Disbursement made by Issuing Lender or an Underlying Issuer under the applicable Letter of Credit. In consideration and in furtherance of the foregoing, each Lender with a Revolver Commitment hereby absolutely and unconditionally agrees to pay to Agent, for the account of the Issuing Lender, such Lender’s Pro Rata Share of each Letter of Credit Disbursement made by Issuing Lender or an Underlying Issuer and not reimbursed by the applicable Borrowers on the date due as provided in Section 2.11(a) , or of any reimbursement payment required to be refunded to any Borrower for any reason. Each Lender with a Revolver Commitment acknowledges and agrees that its obligation to deliver to Agent, for the account of the Issuing Lender, an amount equal to its respective Pro Rata Share of each Letter of Credit Disbursement pursuant to this Section 2.11(b) shall be absolute and unconditional and such remittance shall be made notwithstanding the occurrence or continuation of an Event of Default or Default or the failure to satisfy any condition set forth in Section 3 . If any such Lender fails to make available to Agent the amount of such Lender’s Pro Rata Share of a Letter of Credit Disbursement as provided in this Section, such Lender shall be deemed to be a Defaulting Lender and Agent (for the account of the Issuing Lender) shall be entitled to recover such amount on demand from such Lender together with interest thereon at the Defaulting Lender Rate until paid in full.

 

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(c) (i) The U.S. Borrowers hereby agree to indemnify, save, defend, and hold the Lender Group and each Underlying Issuer harmless from any loss, cost, expense, or liability, and reasonable attorneys fees incurred by Issuing Lender, any other member of the Lender Group, or any Underlying Issuer arising out of or in connection with any Reimbursement Undertaking or any Letter of Credit; provided , however , that the U.S. Borrowers shall not be obligated hereunder to indemnify for any loss, cost, expense, or liability that a court of competent jurisdiction finally determines to have resulted from the gross negligence or willful misconduct of the Issuing Lender, any other member of the Lender Group, or any Underlying Issuer. The U.S. Borrowers agree to be bound by the Underlying Issuer’s regulations and interpretations of any Letter of Credit or by Issuing Lender’s interpretations of any Reimbursement Undertaking even though this interpretation may be different from any U.S. Borrower’s own, and each U.S. Borrower understands and agrees that none of the Issuing Lender, the Lender Group, or any Underlying Issuer shall be liable for any error, negligence, or mistake, whether of omission or commission, in following any U.S. Borrower’s instructions or those contained in the Letter of Credit or any modifications, amendments, or supplements thereto. Each U.S. Borrower understands that the Reimbursement Undertakings may require Issuing Lender to indemnify the Underlying Issuer for certain costs or liabilities arising out of claims by any U.S. Borrower against such Underlying Issuer. The U.S. Borrowers hereby agree to indemnify, save, defend, and hold Issuing Lender and the other members of the Lender Group harmless with respect to any loss, cost, expense (including reasonable attorneys fees), or liability incurred by them as a result of the Issuing Lender’s indemnification of an Underlying Issuer; provided , however , that no U.S. Borrower shall be obligated hereunder to indemnify for any such loss, cost, expense, or liability to the extent that it is caused by the gross negligence or willful misconduct of the Issuing Lender or any other member of the Lender Group. Each U.S. Borrower hereby acknowledges and agrees that none of the Issuing Lender, any other member of the Lender Group, or any Underlying Issuer shall be responsible for delays, errors, or omissions resulting from the malfunction of equipment in connection with any Letter of Credit.

(ii) The Foreign Borrowers hereby agree to indemnify, save, defend, and hold the Lender Group and each Underlying Issuer harmless from any loss, cost, expense, or liability, and reasonable attorneys fees incurred by Issuing Lender, any other member of the Lender Group, or any Underlying Issuer arising out of or in connection with any Reimbursement Undertaking, as applicable to a Foreign Letter of Credit, or any Foreign Letter of Credit; provided , however , that the Foreign Borrowers shall not be obligated hereunder to indemnify for any loss, cost, expense, or liability that a court of competent jurisdiction finally determines to have resulted from the gross negligence or willful misconduct of the Issuing Lender, any other member of the Lender Group, or any Underlying Issuer. The Foreign Borrowers agree to be bound by the Underlying Issuer’s regulations and interpretations of any Foreign Letter of Credit or by Issuing Lender’s interpretations of any Reimbursement Undertaking, as applicable to a Foreign Letter of Credit, even though this interpretation may be different from any Foreign Borrower’s own, and each Foreign Borrower understands and agrees that none of the Issuing Lender, the Lender Group, or any Underlying Issuer shall be liable for any error, negligence, or mistake, whether of omission or commission, in following any Foreign Borrower’s instructions or those contained in the Foreign Letter of Credit or any modifications, amendments, or supplements thereto. Each Foreign Borrower understands that the Reimbursement Undertakings, as applicable to any Foreign Letter of Credit, may require Issuing Lender to indemnify the Underlying Issuer for certain costs or liabilities arising out of claims by any Foreign Borrower against such Underlying Issuer. The Foreign Borrowers hereby agree to indemnify, save, defend, and hold Issuing Lender and the other members of the Lender Group harmless with respect to any loss, cost, expense (including reasonable attorneys fees), or liability incurred by them as a result of the Issuing Lender’s indemnification of an Underlying Issuer; provided , however , that no Foreign Borrower shall be obligated hereunder to indemnify for any such loss, cost, expense, or liability to the extent that it is caused by the gross negligence or willful misconduct of the Issuing Lender or any other member of the Lender Group. Each Foreign Borrower hereby acknowledges and agrees that none of the Issuing Lender, any other member of the Lender Group, or any Underlying Issuer shall be responsible for delays, errors, or omissions resulting from the malfunction of equipment in connection with any Foreign Letter of Credit.

 

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(d) The Borrowers hereby authorize and direct any Underlying Issuer to deliver to the Issuing Lender all instruments, documents, and other writings and property received by such Underlying Issuer pursuant to such Underlying Letter of Credit and to accept and rely upon the Issuing Lender’s instructions with respect to all matters arising in connection with such Underlying Letter of Credit and the related application.

(e) Any and all issuance charges, usage charges, commissions, fees, and costs incurred by the Issuing Lender relating to Underlying Letters of Credit shall be Lender Group Expenses for purposes of this Agreement and shall be reimbursable immediately by the applicable Borrowers to Agent for the account of the Issuing Lender; it being acknowledged and agreed by the Borrowers that, as of the Closing Date, the usage charge imposed by the Underlying Issuer is 0.50% per annum times the undrawn amount of each Underlying Letter of Credit and that the Underlying Issuer also imposes a schedule of charges for amendments, extensions, drawings, and renewals.

(f) If by reason of (i) any change after the Closing Date in any Applicable Law, treaty, rule, or regulation or any change in the interpretation or application thereof by any Governmental Authority, or (ii) compliance by the Issuing Lender, any other member of the Lender Group, or Underlying Issuer with any direction, request, or requirement (irrespective of whether having the force of law) of any Governmental Authority or monetary authority including, Regulation D of the Federal Reserve Board as from time to time in effect (and any successor thereto):

(i) any reserve, deposit, or similar requirement is or shall be imposed or modified in respect of any Letter of Credit issued or caused to be issued hereunder or hereby, or

(ii) there shall be imposed on the Issuing Lender, any other member of the Lender Group, or Underlying Issuer any other condition regarding any Letter of Credit or Reimbursement Undertaking,

and the result of the foregoing is to increase, directly or indirectly, the cost to the Issuing Lender, any other member of the Lender Group, or an Underlying Issuer of issuing, making, guaranteeing, or maintaining any Reimbursement Undertaking or Letter of Credit or to reduce the amount receivable in respect thereof, then, and in any such case, Agent may, at any time within a reasonable period after the additional cost is incurred or the amount received is reduced, notify the applicable Administrative Borrower, and the U.S. Borrowers or Foreign Borrowers, as applicable, shall pay within 30 days after demand therefor, such amounts as Agent may specify (by delivery of a certificate setting forth the calculation of such amounts in reasonable detail, which shall be binding on the Borrowers absent manifest error) to be necessary to compensate the Issuing Lender, any other member of the Lender Group, or an Underlying Issuer for such additional cost or reduced receipt, together with interest on such amount from the date of such demand until payment in full thereof at the rate then applicable to Base Rate Loans hereunder; provided , however , that the Borrowers shall not be required to provide any compensation pursuant to this Section 2.11(f) for any such amounts incurred more than 180 days prior to the date on which the demand for payment of such amounts is first made to Administrative Borrower; provided further , however , that if an event or circumstance giving rise to such amounts is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof. The determination by Agent of any amount due pursuant to this Section 2.11(f) , as set forth in a certificate setting forth the calculation thereof in reasonable detail, shall, in the absence of manifest or demonstrable error, be final and conclusive and binding on all of the parties hereto.

 

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2.12. LIBOR Option .

(a) Interest and Interest Payment Dates. In lieu of having interest charged at the rate based upon the Base Rate, the Borrowers shall have the option, subject to Section 2.12(b) below (the “ LIBOR Option ”), to have interest on all or a portion of the Advances be charged (whether at the time when made (unless otherwise provided herein), upon conversion from a Base Rate Loan to a LIBOR Rate Loan, or upon continuation of a LIBOR Rate Loan as a LIBOR Rate Loan) at a rate of interest based upon the LIBOR Rate. Interest on LIBOR Rate Loans shall be payable on the earliest of (i) the last day of the Interest Period applicable thereto; (ii) the date on which all or any portion of the Obligations are accelerated pursuant to the terms hereof, or (iii) the date on which this Agreement is terminated pursuant to the terms hereof. On the last day of each applicable Interest Period, unless U.S. Administrative Borrower properly has exercised the LIBOR Option with respect thereto, the interest rate applicable to such LIBOR Rate Loan automatically shall convert to the rate of interest then applicable to Base Rate Loans of the same type hereunder. At any time that an Event of Default has occurred and is continuing, the Borrowers no longer shall have the option to request that Advances bear interest at a rate based upon the LIBOR Rate.

(b) LIBOR Election.

(i) Either Administrative Borrower, on behalf of the applicable Borrowers, may, at any time and from time to time, so long as no Event of Default has occurred and is continuing, elect to exercise the LIBOR Option by notifying Agent prior to 2:00 p.m. (New York time) at least 3 Business Days prior to the commencement of the proposed Interest Period (the “ LIBOR Deadline ”). Notice of such Administrative Borrower’s election of the LIBOR Option for a permitted portion of the Advances and an Interest Period pursuant to this Section shall be made by delivery to Agent of a LIBOR Notice received by Agent before the LIBOR Deadline, or by telephonic notice received by Agent before the LIBOR Deadline (to be confirmed by delivery to Agent of a LIBOR Notice received by Agent prior to 5:00 p.m. (New York time) on the same day). Promptly upon its receipt of each such LIBOR Notice, Agent shall provide a copy thereof to each of the affected Lenders.

(ii) Each LIBOR Notice shall be irrevocable and binding on the applicable Borrowers. In connection with each U.S. Advance constituting a LIBOR Rate Loan, the U.S. Borrowers shall indemnify, defend, and hold Agent and the Lenders harmless against any loss, cost, or expense actually incurred by Agent or any Lender as a result of (A) the payment of any principal of any U.S. Advance constituting a LIBOR Rate Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (B) the conversion of any U.S. Advance constituting a LIBOR Rate Loan other than on the last day of the Interest Period applicable thereto, or (C) the failure to borrow, convert, continue or prepay any U.S. Advance constituting a LIBOR Rate Loan on the date specified in any LIBOR Notice delivered pursuant hereto (such losses, costs, or expenses, “ U.S. Funding Losses ”). A certificate of Agent or a Lender delivered to U.S. Administrative Borrower setting forth in reasonable detail any amount or amounts that Agent or such Lender is entitled to receive pursuant to this Section 2.12 shall be conclusive absent manifest error. The U.S. Borrowers shall pay such amount to Agent or the Lender, as applicable, within 30 days of the date of its receipt of such certificate. In connection with each Foreign Advance constituting a LIBOR Rate Loan, the Foreign Borrowers shall indemnify, defend, and hold Agent and the Lenders harmless against any loss, cost, or expense actually incurred by Agent or any Lender as a result of (A) the payment of any principal of any Foreign Advance constituting a LIBOR Rate Loan other than on the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (B) the conversion of any Foreign Advance constituting a LIBOR Rate Loan other than on the last day of the Interest Period applicable thereto, or (C) the failure to borrow, convert, continue or prepay any Foreign Advance constituting a LIBOR Rate Loan on the date specified in any LIBOR Notice delivered pursuant hereto (such losses, costs, or expenses, “ Foreign Funding Losses ” and together with U.S. Funding Losses, “ Funding Losses ”). A certificate of Agent or a Lender delivered to Foreign Administrative Borrower setting forth in reasonable detail any amount or amounts that Agent or such Lender is entitled to receive pursuant to this Section 2.12 shall be conclusive absent manifest error. The Foreign Borrowers shall pay such amount to Agent or the Lender, as applicable, within 30 days of the date of its receipt of such certificate. For the avoidance of doubt, the Borrowers shall have no liability for U.S. Funding Losses or Foreign Funding Losses that may arise by virtue of any Base Rate Loan accruing interest at a rate calculated in reference to the Base LIBOR Rate pursuant to clause (b) of the definition of “Base Rate.” If a payment of a LIBOR Rate Loan on a day other than the last day of the

 

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applicable Interest Period would result in a Funding Loss, Agent may, in its sole discretion at the request of the applicable Administrative Borrower, hold the amount of such payment as cash collateral in support of the applicable Obligations until the last day of such Interest Period and apply such amounts to the payment of the applicable LIBOR Rate Loan on such last day, it being agreed that Agent has no obligation to so defer the application of payments to any LIBOR Rate Loan and that, in the event that Agent does not defer such application, the applicable Borrowers shall be obligated to pay any resulting Funding Losses.

(iii) The Borrowers shall have not more than 7 LIBOR Rate Loans in effect at any given time. The Borrowers only may exercise the LIBOR Option for proposed LIBOR Rate Loans of at least $1,000,000.

(c) Conversion. The Borrowers may convert LIBOR Rate Loans to Base Rate Loans at any time; provided , however , that in the event that LIBOR Rate Loans are converted or prepaid on any date that is not the last day of the Interest Period applicable thereto, including as a result of any automatic prepayment through the required application by Agent of proceeds of any Loan Parties’ Collections in accordance with Section 2.4(b) or for any other reason, including early termination of the term of this Agreement or acceleration of all or any portion of the Obligations pursuant to the terms hereof, the U.S. Borrowers and the Foreign Borrowers shall indemnify, defend, and hold Agent and the Lenders and (without duplication) their Participants harmless against any and all U.S. Funding Losses and Foreign Funding Losses, as applicable, in accordance with Section 2.12(b)(ii) .

(d) Special Provisions Applicable to LIBOR Rate.

(i) The LIBOR Rate may be adjusted by Agent with respect to any Lender on a prospective basis to take into account any additional or increased costs to such Lender of maintaining or obtaining any eurodollar deposits or increased costs, in each case, due to changes in Applicable Law occurring subsequent to the commencement of the then applicable Interest Period, including changes in tax laws (except changes of general applicability in corporate income tax laws) and changes in the reserve requirements imposed by the Board of Governors of the Federal Reserve System (or any successor), excluding the Reserve Percentage, which additional or increased costs would increase the cost of funding or maintaining loans bearing interest at the LIBOR Rate. In any such event, the affected Lender shall give the applicable Administrative Borrower and Agent notice of such a determination and adjustment and Agent promptly shall transmit the notice to each other Lender and, upon its receipt of the notice from the affected Lender, the applicable Administrative Borrower may, by notice to such affected Lender (y) require such Lender to furnish to the applicable Administrative Borrower a statement setting forth the basis for adjusting such LIBOR Rate and the method for determining the amount of such adjustment, or (z) repay the LIBOR Rate Loans with respect to which such adjustment is made (together with any amounts due under Section 2.12(b)(ii) ).

(ii) In the event that any change in market conditions or any law, regulation, treaty, or directive, or any change therein or in the interpretation or application thereof, shall at any time after the date hereof, in the reasonable opinion of any Lender, make it unlawful or impractical for such Lender to fund or maintain LIBOR Rate Loans or to continue such funding or maintaining, or to determine or charge interest rates at the LIBOR Rate, such Lender shall give notice of such changed circumstances to Agent and U.S. Administrative Borrower and Agent promptly shall transmit the notice to each other Lender and (y) in the case of any LIBOR Rate Loans of such Lender that are outstanding, the date specified in such Lender’s notice shall be deemed to be the last day of the Interest Period of such LIBOR Rate Loans, and interest upon the LIBOR Rate Loans of such Lender thereafter shall accrue interest at the rate then applicable to Base Rate Loans, and (z) the Borrowers shall not be entitled to elect the LIBOR Option until such Lender determines that it would no longer be unlawful or impractical to do so.

(e) No Requirement of Matched Funding. Anything to the contrary contained herein notwithstanding, neither Agent, nor any Lender, nor any of their Participants, is required actually to acquire eurodollar deposits to fund or otherwise match fund any Obligation as to which interest accrues at the LIBOR Rate.

 

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2.13. Capital Requirements; Replacement of Certain Lenders .

(a) If, after the date hereof, any Lender determines that (i) the adoption of or change in any law, rule, regulation or guideline regarding capital requirements for banks or bank holding companies, or any change in the interpretation or application thereof by any Governmental Authority charged with the administration thereof, or (ii) compliance by such Lender or its parent bank holding company with any guideline, request or directive of any such entity regarding capital adequacy (whether or not having the force of law), has the effect (taking into account the Reserve Percentage and other costs previously included in the definition of LIBOR Rate) of reducing the return on such Lender’s or such holding company’s capital as a consequence of such Lender’s Commitments hereunder to a level below that which such Lender or such holding company could have achieved but for such adoption, change, or compliance (taking into consideration such Lender’s or such holding company’s then existing policies with respect to capital adequacy and assuming the full utilization of such entity’s capital) by any amount deemed by such Lender to be material, then such Lender may notify U.S. Administrative Borrower and Agent thereof. Following receipt of such notice, the applicable Borrowers agree to pay such Lender on demand the amount of such reduction of return of capital as and when such reduction is determined, payable within 30 days after presentation by such Lender of a statement in the amount and setting forth in reasonable detail such Lender’s calculation thereof and the assumptions upon which such calculation was based (which statement shall be deemed true and correct absent manifest error). In determining such amount, such Lender may use any reasonable averaging and attribution methods. Failure or delay on the part of any Lender to demand compensation pursuant to this Section shall not constitute a waiver of such Lender’s right to demand such compensation; provided that the Borrowers shall not be required to compensate a Lender pursuant to this Section for any reductions in return incurred more than 180 days prior to the date that such Lender notifies U.S. Administrative Borrower of such law, rule, regulation or guideline giving rise to such reductions and of such Lender’s intention to claim compensation therefor; provided further , that if such claim arises by reason of the adoption of or change in any law, rule, regulation or guideline that is retroactive, then the 180-day period referred to above shall be extended to include the period of retroactive effect thereof.

(b) If any Lender requests additional or increased costs referred to in Section 2.12(d)(i) or amounts under Section 2.13(a) or delivers a notice under Section 2.12(d)(ii) (any such Lender, an “ Affected Lender ”), then, if requested by the applicable Administrative Borrower to do so, such Affected Lender shall use reasonable efforts to promptly designate a one of its other lending offices or to assign its rights and obligations hereunder to another of its offices or branches, if (i) in the reasonable judgment of such Affected Lender, such designation or assignment would eliminate or reduce amounts payable pursuant to Section 2.12(d)(i) or Section 2.13(a) or not require the delivery of a notice pursuant to Section 2.12(d)(ii) , as applicable, and (ii) in the reasonable judgment of such Affected Lender, such designation or assignment would not subject it to any material unreimbursed cost or expense and would not otherwise be materially disadvantageous to it. If the applicable Administrative Borrower requests that an Affected Lender take such actions, the applicable Borrowers agree to pay all reasonable out-of-pocket costs and expenses incurred by such Affected Lender in connection with any such designation or assignment. If, (x) after such reasonable efforts, such Affected Lender does not so designate one of its other lending offices or assign its rights to another of its offices or branches so as to eliminate the Borrowers’ obligation to pay any future amounts to such Affected Lender pursuant to Section 2.12(d)(i) or Section 2.13(a) or eliminate the restrictions with respect to LIBOR Rate Loans referenced in the notice delivered pursuant to Section 2.12(d)(ii) , as applicable or (y) any Lender is a Deteriorating Lender, then the applicable Administrative Borrower (without prejudice to any amounts then due to such Affected Lender under Section 2.12(d)(i) or Section 2.13(a) , as applicable) may, unless prior to the effective date of any such assignment the Affected Lender withdraws its request for such additional amounts under Section 2.12(d)(i) or Section 2.13(a) or its notice issued under Section 2.12(d)(ii) , as applicable, seek one or more substitute Lenders reasonably acceptable to Agent to purchase the Obligations owed to such Affected Lender or Deteriorating Lender (as applicable) and such Affected Lender’s or

 

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Deteriorating Lender’s (as applicable) Commitments hereunder (each such substitute Lender, a “ Replacement Lender ”), and if such Replacement Lender(s) agree(s) to such purchase, such Affected Lender or Deteriorating Lender (as applicable) shall assign to the Replacement Lender(s) its Obligations and Commitments, pursuant to an Assignment and Acceptance, and upon such purchase by the Replacement Lender(s), such Replacement Lender(s) shall each be deemed to be a “Lender” for purposes of this Agreement and such Affected Lender or Deteriorating Lender (as applicable) shall cease to be a “Lender” for purposes of this Agreement. In connection with the arrangement of such Replacement Lender(s), the Affected Lender or Deteriorating Lender (as applicable) shall have no right to refuse to be replaced hereunder, and agrees to execute and deliver a completed form of Assignment and Acceptance in favor of the Replacement Lender(s) (and agrees that it shall be deemed to have executed and delivered such document if it fails to do so) subject only to being repaid its share of the outstanding Obligations without any premium or penalty of any kind whatsoever.

2.14. Joint and Several Liability of Borrowers; Foreign Borrowers Not Liable for U.S. Obligations .

(a) Each U.S. Borrower hereby agrees as follows:

(i) Each U.S. Borrower is accepting joint and several liability hereunder and under the other Loan Documents in consideration of the financial accommodations to be provided by the Lender Group under this Agreement, for the mutual benefit, directly and indirectly, of each U.S. Borrower and in consideration of the undertakings of the other U.S. Borrowers to accept joint and several liability for the Obligations.

(ii) Each U.S. Borrower, jointly and severally, hereby irrevocably and unconditionally accepts, not merely as a surety but also as a co-debtor, joint and several liability with the other U.S. Borrowers, with respect to the payment and performance of all of the Obligations (including any Obligations arising under this Section 2.14(a) ), it being the intention of the parties hereto that all the Obligations shall be the joint and several obligations of each U.S. Borrower without preferences or distinction among them.

(iii) If and to the extent that any U.S. Borrower shall fail to make any payment with respect to any of the Obligations as and when due or to perform any of the Obligations in accordance with the terms thereof (including any applicable grace period or notice requirements), then in each such event the other U.S. Borrowers will make such payment with respect to, or perform, such Obligation.

(iv) The Obligations of each U.S. Borrower under the provisions of this Section 2.14(a) constitute the absolute and unconditional, full recourse Obligations of each U.S. Borrower enforceable against each U.S. Borrower to the full extent of its properties and assets, irrespective of the validity, regularity or enforceability of this Agreement or any other circumstances whatsoever.

(v) Except as otherwise expressly provided in any applicable Loan Document, to the extent permitted by Applicable Law, each U.S. Borrower hereby waives notice of acceptance of its joint and several liability, notice of any Advances or Letters of Credit issued under or pursuant to this Agreement, notice of the occurrence of any Default, Event of Default, or of any demand for any payment under this Agreement, notice of any action at any time taken or omitted by Agent or Lenders under or in respect of any of the Obligations, any requirement of diligence or to mitigate damages and, generally, to the extent permitted by Applicable Law, all demands, notices and other formalities of every kind in connection with this Agreement (except as otherwise provided in this Agreement or any other applicable Loan Document). To the extent permitted by Applicable Law, each U.S. Borrower hereby assents to, and waives notice of, any extension or postponement of the time for the payment of any of the Obligations, the acceptance of any payment of any of the Obligations, the acceptance of any partial payment thereon, any waiver, consent or other action or acquiescence by Agent or Lenders at any time or times in respect of any default by any U.S. Borrower in the performance or satisfaction of any term, covenant, condition or provision of this Agreement, any and all other

 

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indulgences whatsoever by Agent or Lenders in respect of any of the Obligations, and the taking, addition, substitution or release, in whole or in part, at any time or times, of any security for any of the Obligations or the addition, substitution or release, in whole or in part, of any U.S. Borrower. Without limiting the generality of the foregoing, to the extent permitted by Applicable Law, each U.S. Borrower assents to any other action or delay in acting or failure to act on the part of Agent or any Lender with respect to the failure by any U.S. Borrower to comply with any of its respective Obligations, including, without limitation, any failure strictly or diligently to assert any right or to pursue any remedy or to comply fully with Applicable Laws or regulations thereunder, which might, but for the provisions of this Section 2.14(a) afford grounds for terminating, discharging or relieving any U.S. Borrower, in whole or in part, from any of its Obligations under this Section 2.14(a) , it being the intention of each U.S. Borrower that, so long as any of the Obligations hereunder remain unsatisfied, the Obligations of each Borrower under this Section 2.14(a) shall not be discharged except by performance and then only to the extent of such performance. The Obligations of each Borrower under this Section 2.14(a) shall not be diminished or rendered unenforceable by any winding up, reorganization, arrangement, liquidation, reconstruction or similar proceeding with respect to any Borrower or Agent or any Lender.

(vi) Each U.S. Borrower represents and warrants to Agent and Lenders that such U.S. Borrower is currently informed of the financial condition of the other Borrowers and of all other circumstances which a diligent inquiry would reveal and which bear upon the risk of nonpayment of the Obligations. Each U.S. Borrower further represents and warrants to Agent and Lenders that such U.S. Borrower has read and understands the terms and conditions of the Loan Documents. Each U.S. Borrower hereby covenants that such U.S. Borrower will continue to keep informed of the other Borrowers’ financial condition, the financial condition of other guarantors, if any, and of all other circumstances which bear upon the risk of nonpayment or nonperformance of the Obligations.

(vii) Each U.S. Borrower waives all rights and defenses arising out of an election of remedies by Agent or any Lender, even though that election of remedies, such as a nonjudicial foreclosure with respect to security for a guaranteed obligation, has destroyed Agent’s or such Lender’s rights of subrogation and reimbursement against any Borrower by the operation of Section 580(d) of the California Code of Civil Procedure, any comparable statute, or otherwise.

(viii) Each U.S. Borrower waives all rights and defenses that such Borrower may have because the Obligations are or become secured by Real Property. This means, among other things:

(A) Agent and Lenders may collect from such U.S. Borrower without first foreclosing on any Real Property Collateral or personal property Collateral pledged by Borrowers.

(B) If Agent or any Lender forecloses on any Real Property Collateral pledged by any Borrower or any Guarantor:

(1) the amount of the Obligations may be reduced only by the price for which such Collateral is sold at the foreclosure sale, even if such Collateral is worth more than the sale price; and

(2) Agent and Lenders may collect from such U.S. Borrower even if Agent or Lenders, by foreclosing on the Real Property Collateral, has destroyed any right such U.S. Borrower may have to collect from the other Borrowers. This is an unconditional and irrevocable waiver of any rights and defenses such U.S. Borrower may have because the Obligations are secured by Real Property. These rights and defenses include, but are not limited to, any rights or defenses based upon Section 580a, 580b, 580d or 726 of the California Code of Civil Procedure or any comparable statutes. As provided in Section 12(a), this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York without regard to conflict of law principles thereof. The foregoing provisions are included solely out of an abundance of caution and shall not be construed to mean that any of the above referenced provisions of California law are in any way applicable to this Agreement or the U.S. Obligations.

 

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(ix) The provisions of this Section 2.14(a) are made for the benefit of Agent, Lenders and their respective successors and permitted assigns, and may be enforced by it or them from time to time against any or all U.S. Borrowers as often as occasion therefor may arise and without requirement on the part of Agent, any Lender, any of their respective successors or permitted assigns first to marshal any of its or their claims or to exercise any of its or their rights against any Borrower or to exhaust any remedies available to it or them against any U.S. Borrower or to resort to any other source or means of obtaining payment of any of the Obligations hereunder or to elect any other remedy. The provisions of this Section 2.14(a) shall remain in effect until all of the Obligations shall have been paid in full in accordance with the terms of this Agreement. If at any time, any payment, or any part thereof, made in respect of any of the Obligations, is rescinded or must otherwise be restored or returned by Agent or any Lender upon the insolvency, bankruptcy or reorganization of any Borrower, or otherwise, the provisions of this Section 2.14(a) will forthwith be reinstated in effect, as though such payment had not been made.

(x) Until the Obligations have been paid in full and all of the Commitments have been terminated, each U.S. Borrower hereby agrees that it will not enforce any of its rights of contribution or subrogation against any other U.S. Borrower with respect to any liability incurred by it hereunder or under any of the other Loan Documents, any payments made by it to Agent or any Lender with respect to any of the Obligations or any collateral security therefor until such time as all of the Obligations have been paid in full in cash. Any claim which any U.S. Borrower may have against any other Borrower with respect to any payments to Agent or any Lender hereunder or under any other Loan Documents are hereby expressly made subordinate and junior in right of payment, without limitation as to any increases in the Obligations arising hereunder or thereunder, to the prior payment in full in cash of the Obligations and, in the event of any insolvency, bankruptcy, receivership, liquidation, reorganization or other similar proceeding under the laws of any jurisdiction relating to any U.S. Borrower, its debts or its assets, whether voluntary or involuntary, all such Obligations shall be paid in full in cash before any payment or distribution of any character, whether in cash, securities or other property, shall be made to any other U.S. Borrower therefor.

(xi) Each U.S. Borrower hereby agrees that, after the occurrence and during the continuance of any Event of Default, the payment of any amounts due with respect to the indebtedness owing by any Borrower to any other Borrower is hereby subordinated to the prior payment in full in cash of the Obligations. Each U.S. Borrower hereby agrees that after the occurrence and during the continuance of any Event of Default, such U.S. Borrower will not demand, sue for or otherwise attempt to collect any indebtedness of any other Borrower owing to such U.S. Borrower until the Obligations shall have been paid in full in cash. If, notwithstanding the foregoing sentence, such U.S. Borrower shall collect, enforce or receive any amounts in respect of such indebtedness, such amounts shall be collected, enforced and received by such U.S. Borrower as trustee for Agent, and such U.S. Borrower shall deliver any such amounts to Agent for application to the U.S. Obligations in accordance with Section 2.4(b) .

(b) Each Foreign Borrower hereby agrees as follows:

(i) Each Foreign Borrower (other than Stream Canada) is accepting joint and several liability hereunder and under the other Loan Documents in consideration of the financial accommodations to be provided by the Lender Group under this Agreement, for the mutual benefit, directly and indirectly, of each Foreign Borrower and in consideration of the undertakings of the other Foreign Borrowers (other than Stream Canada) to accept joint and several liability for the Foreign Obligations.

(ii) Each Foreign Borrower (other than Stream Canada), jointly and severally, hereby irrevocably and unconditionally accepts, not merely as a surety but also as a co-debtor (except for Stream Canada), joint and several liability with the other Foreign Borrowers, with respect to the payment and performance of all of the Foreign Obligations (including any Foreign Obligations arising under this Section 2.14(b) ), it being the intention of the parties hereto that all the Foreign Obligations shall be the joint and several obligations of each Foreign Borrower (other than Stream Canada) without preferences or distinction among them.

 

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(iii) If and to the extent that any Foreign Borrower shall fail to make any payment with respect to any of the Foreign Obligations as and when due or to perform any of the Foreign Obligations in accordance with the terms thereof (including any applicable grace period or notice requirements), then in each such event the other Foreign Borrowers (other than Stream Canada) will make such payment with respect to, or perform, such Foreign Obligation.

(iv) The Foreign Obligations of each Foreign Borrower under the provisions of this Section 2.14(b) constitute the absolute and unconditional, full recourse Foreign Obligations of each Foreign Borrower (other than Stream Canada) enforceable against each Foreign Borrower (other than Stream Canada) to the full extent of its properties and assets, irrespective of the validity, regularity or enforceability of this Agreement or any other circumstances whatsoever (other than satisfaction in full of the Foreign Obligations) which might otherwise constitute a legal or equitable discharge of the Obligations of any Foreign Borrower (other than Stream Canada) pursuant to this Section 2.14(b) .

(v) The Foreign Obligations of Stream Canada under the provisions of this Section 2.14(b) constitute the absolute and unconditional, full recourse Foreign Obligations of Stream Canada enforceable against Stream Canada to the full extent of its properties and assets, irrespective of the validity, regularity or enforceability of this Agreement or any other circumstances whatsoever (other than payment and satisfaction in full of its Foreign Obligations) which might otherwise constitute a legal or equitable discharge of the Obligations of Stream Canada pursuant to this Section 2.14(b) .

(vi) Except as otherwise expressly provided in any applicable Loan Document, to the extent permitted by Applicable Law, each Foreign Borrower hereby waives notice of acceptance of its joint and several liability (if applicable), notice of any Foreign Advances or Foreign Letters of Credit issued under or pursuant to this Agreement, notice of the occurrence of any Default, Event of Default, or of any demand for any payment under this Agreement, notice of any action at any time taken or omitted by Agent or Lenders under or in respect of any of the Foreign Obligations, any requirement of diligence or to mitigate damages and, generally, to the extent permitted by Applicable Law, all demands, notices and other formalities of every kind in connection with this Agreement (except as otherwise provided in this Agreement or any other applicable Loan Document). To the extent permitted by Applicable Law, each Foreign Borrower hereby assents to, and waives notice of, any extension or postponement of the time for the payment of any of the Foreign Obligations, the acceptance of any payment of any of the Foreign Obligations, the acceptance of any partial payment thereon, any waiver, consent or other action or acquiescence by Agent or Lenders at any time or times in respect of any default by any Foreign Borrower in the performance or satisfaction of any term, covenant, condition or provision of this Agreement, any and all other indulgences whatsoever by Agent or Lenders in respect of any of the Foreign Obligations, and the taking, addition, substitution or release, in whole or in part, at any time or times, of any security for any of the Foreign Obligations or the addition, substitution or release, in whole or in part, of any Foreign Borrower. Without limiting the generality of the foregoing, to the extent permitted by Applicable Law, each Foreign Borrower assents to any other action or delay in acting or failure to act on the part of Agent or any Lender with respect to the failure by any Foreign Borrower to comply with any of its respective Foreign Obligations, including, without limitation, any failure strictly or diligently to assert any right or to pursue any remedy or to comply fully with Applicable Laws or regulations thereunder, which might, but for the provisions of this Section 2.14(b) afford grounds for terminating, discharging or relieving any Foreign Borrower, in whole or in part, from any of its Foreign Obligations under this Section 2.14(b) , it being the intention of each Foreign Borrower that, so long as any of the Foreign Obligations hereunder remain unsatisfied, the Foreign Obligations of each Foreign Borrower under this Section 2.14(b) shall not be discharged except by performance and then only to the extent of such performance. The Foreign Obligations of each Foreign Borrower under this Section 2.14(b) shall not be diminished or rendered unenforceable by any winding up, reorganization, arrangement, liquidation, reconstruction or similar proceeding with respect to any Foreign Borrower or Agent or any Lender.

 

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(vii) Each Foreign Borrower represents and warrants to Agent and Lenders that such Foreign Borrower is currently informed of the financial condition of the other Foreign Borrowers and of all other circumstances which a diligent inquiry would reveal and which bear upon the risk of nonpayment of the Foreign Obligations. Each Foreign Borrower further represents and warrants to Agent and Lenders that such Foreign Borrower has read and understands the terms and conditions of the Loan Documents. Each Foreign Borrower hereby covenants that such Foreign Borrower will continue to keep informed of the other Foreign Borrowers’ financial condition, the financial condition of other guarantors, if any, and of all other circumstances which bear upon the risk of nonpayment or nonperformance of the Foreign Obligations.

(viii) Each Foreign Borrower waives all rights and defenses arising out of an election of remedies by Agent or any Lender, even though that election of remedies, such as a nonjudicial foreclosure (which term in this Section 2.14(b) shall include a power of sale) with respect to security for a guaranteed obligation, has destroyed Agent’s or such Lender’s rights of subrogation and reimbursement against any Foreign Borrower by the operation of Section 580(d) of the California Code of Civil Procedure, any comparable statute, or otherwise.

(ix) Each Foreign Borrower waives all rights and defenses that such Foreign Borrower may have because the Foreign Obligations are or become secured by Real Property. This means, among other things:

(A) Agent and Lenders may collect from such Foreign Borrower without first foreclosing on any Real Property Collateral or personal property Collateral pledged by Foreign Borrowers.

(B) If Agent or any Lender forecloses on any Real Property Collateral pledged by any Foreign Borrower or any Guarantor:

(1) the amount of the Foreign Obligations may be reduced only by the price for which such Collateral is sold at the foreclosure sale, even if such Collateral is worth more than the sale price; and

(2) Agent and Lenders may collect from such Foreign Borrower even if Agent or Lenders, by foreclosing on the Real Property Collateral, has destroyed any right such Foreign Borrower may have to collect from the other Foreign Borrowers. This is an unconditional and irrevocable waiver of any rights and defenses such Foreign Borrower may have because the Foreign Obligations are secured by Real Property. These rights and defenses include, but are not limited to, any rights or defenses based upon Section 580a, 580b, 580d or 726 of the California Code of Civil Procedure or any comparable statutes. As provided in Section 12(a), this Agreement shall be governed by, and construed in accordance with, the laws of the State of New York without regard to conflict of law principles thereof. The foregoing provisions are included solely out of an abundance of caution and shall not be construed to mean that any of the above referenced provisions of California law are in any way applicable to this Agreement or the Foreign Obligations.

(x) The provisions of this Section 2.14(b) are made for the benefit of Agent, Lenders and their respective successors and permitted assigns, and may be enforced by it or them from time to time against any or all Foreign Borrowers as often as occasion therefor may arise and without requirement on the part of Agent, any Lender, any of their respective successors or permitted assigns first to marshal any of its or their claims or to exercise any of its or their rights against any Foreign Borrower or to exhaust any remedies available to it or them against any Foreign Borrower or to resort to any other source or means of obtaining payment of any of the Foreign Obligations hereunder or to elect any other remedy. The provisions of this

 

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Section 2.14(b) shall remain in effect until all of the Foreign Obligations shall have been paid in full in accordance with the terms of this Agreement. If at any time, any payment, or any part thereof, made in respect of any of the Foreign Obligations, is rescinded or must otherwise be restored or returned by Agent or any Lender upon the insolvency, bankruptcy or reorganization of any Foreign Borrower, or otherwise, the provisions of this Section 2.14(b) will forthwith be reinstated in effect, as though such payment had not been made.

(xi) Until the Foreign Obligations have been paid in full and all of the Commitments have been terminated, each Foreign Borrower hereby agrees that it will not enforce any of its rights of contribution or subrogation against any other Foreign Borrower with respect to any liability incurred by it hereunder or under any of the other Loan Documents, any payments made by it to Agent or any Lender with respect to any of the Foreign Obligations or any collateral security therefor until such time as all of the Foreign Obligations have been paid in full in cash. Any claim which any Foreign Borrower may have against any other Foreign Borrower with respect to any payments to Agent or any Lender hereunder or under any other Loan Documents are hereby expressly made subordinate and junior in right of payment, without limitation as to any increases in the Foreign Obligations arising hereunder or thereunder, to the prior payment in full in cash of the Foreign Obligations and, in the event of any insolvency, bankruptcy, receivership, liquidation, reorganization or other similar proceeding under the laws of any jurisdiction relating to any Foreign Borrower, its debts or its assets, whether voluntary or involuntary, all such Foreign Obligations shall be paid in full in cash before any payment or distribution of any character, whether in cash, securities or other property, shall be made to any other Foreign Borrower therefor.

(xii) Each Foreign Borrower hereby agrees that, after the occurrence and during the continuance of any Event of Default, the payment of any amounts due with respect to the indebtedness owing by any Foreign Borrower to any other Foreign Borrower is hereby subordinated to the prior payment in full in cash of the Foreign Obligations. Each Foreign Borrower hereby agrees that after the occurrence and during the continuance of any Event of Default, such Foreign Borrower will not demand, sue for or otherwise attempt to collect any indebtedness of any other Foreign Borrower owing to such Foreign Borrower until the Foreign Obligations shall have been paid in full in cash. If, notwithstanding the foregoing sentence, such Foreign Borrower shall collect, enforce or receive any amounts in respect of such indebtedness, such amounts shall be collected, enforced and received by such Foreign Borrower as trustee for Agent, and such Foreign Borrower shall deliver any such amounts to Agent for application to the Foreign Obligations in accordance with Section 2.4(b) .

(xiii) For greater certainty, nothing in this Section 2.14(b) is intended to reduce, diminish or otherwise relieve Stream Canada from any of its Obligations arising pursuant to or in connection with the Canadian Guarantee or any other Loan Document.

(c) Notwithstanding anything to the contrary set forth herein or in any other Loan Document, in no event shall any Foreign Borrower be deemed to be a guarantor of, surety in respect of, or otherwise, directly or indirectly, liable for the payment of any U.S. Obligations.

2.15. Parallel Debt .

(a) Parallel Debt Foreign.

(i) Each Dutch Borrower (other than Stream BV) hereby irrevocably and unconditionally undertakes to pay to Agent, acting on its own behalf (in Dutch: voor zich ) and not as agent for any Person, amounts equal to the aggregate amount payable ( verschuldigd ) in respect of the Foreign Obligations (such payment undertakings to Agent, hereinafter referred to as the “ Parallel Debt Foreign ”).

 

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(ii) The Parallel Debt Foreign will become due and payable ( opeisbaar ) as and when one or more of the Foreign Obligations becomes due and payable without any further notice being required.

(iii) Each of the parties to this Agreement hereby acknowledges that: (x) the Parallel Debt Foreign constitutes an undertaking, obligation and liability of each of the Dutch Borrowers (other than Stream BV) to Agent which is transferable and separate and independent from, and without prejudice to, the Foreign Obligations and (y) the Parallel Debt Foreign represents Agent’s own separate and independent claim ( eigen en zelfstandige vordering ) to receive payment of the Parallel Debt Foreign from each of the Dutch Borrowers (other than Stream BV), it being understood, that the amount which may become payable by any Dutch Borrowers (other than Stream BV) under or pursuant to the Parallel Debt Foreign from time to time shall never exceed the aggregate amount which is payable under the Foreign Obligations from time to time.

(iv) For the avoidance of doubt, each of the parties to this Agreement hereby confirms that the claim of Agent against each of the Dutch Borrowers (other than Stream BV) in respect of the Parallel Debt Foreign and the claims of any Lender against the parties in respect of the Foreign Obligations payable to such Lender do not constitute common property ( een gemeenschap ) within the meaning of Article 3:166 of the Dutch Civil Code (“ DCC ”) and that the provision relating to such common property shall not apply. If, however, it shall be held that such claim of Agent and such claims of any Lender do constitute such common property and such provisions do apply, the parties to this Agreement agree that this Agreement shall constitute the administration agreement ( beheersregeling ) within the meaning of Article 3:168 DCC.

(v) For the avoidance of doubt, the parties hereto confirm that this Agreement is not to be construed as an agreement as referred to in Article 6:16 DCC and that Article 6:16 DCC shall not apply, and therefore, that the provisions relating to common property ( een gemeenschap ) within the meaning of Article 3:166 DCC shall not apply by analogy to the relationship between Agent and any Lender on the one hand and each of the Dutch Borrowers (other than Stream BV) on the other hand.

(vi) To the extent Agent irrevocably ( onaantastbaar ) receives any amount in payment of the Parallel Debt Foreign (the “ Received Amount ”), the Foreign Obligations shall be reduced by an aggregate amount (the “ Deductible Amount ”) equal to the Received Amount in the manner as if the Deductible Amount were received as a payment of the Foreign Obligations. For the avoidance of doubt, to the extent Agent irrevocably ( onaantastbaar ) receives any amount in payment of the Foreign Obligations, the Parallel Debt Foreign shall be reduced accordingly as if such payment was received as a payment of the Parallel Debt Foreign.

(b) Parallel Debt U.S.

(i) Stream BV hereby irrevocably and unconditionally undertakes to pay to Agent, acting on its own behalf (in Dutch: voor zich ) and not as agent for any Person, amounts equal to the aggregate amount payable ( verschuldigd ) in respect of the U.S. Obligations (such payment undertakings to Agent, hereinafter referred to as the “ Parallel Debt U.S. ”).

(ii) The Parallel Debt U.S. will become due and payable ( opeisbaar ) as and when one or more of the U.S. Obligations becomes due and payable without any further notice being required.

(iii) Each of the parties to this Agreement hereby acknowledges that: (x) the Parallel Debt U.S. constitutes an undertaking, obligation and liability of Stream BV to Agent which is transferable and separate and independent from, and without prejudice to, the U.S. Obligations and (y) the Parallel Debt U.S. represents Agent’s own separate and independent claim ( eigen en zelfstandige vordering ) to receive payment of the Parallel Debt U.S. from Stream BV, it being understood, that the amount which may become payable by Stream BV under or pursuant to the Parallel Debt U.S. from time to time shall never exceed the aggregate amount which is payable under the U.S. Obligations from time to time.

 

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(iv) For the avoidance of doubt, each of the parties to this Agreement hereby confirms that the claim of Agent against Stream BV in respect of the Parallel Debt U.S. and the claims of any Lender against the parties in respect of the U.S. Obligations payable to such Lender do not constitute common property ( een gemeenschap ) within the meaning of Article 3:166 of the DCC and that the provision relating to such common property shall not apply. If, however, it shall be held that such claim of Agent and such claims of any Lender do constitute such common property and such provisions do apply, the parties to this Agreement agree that this Agreement shall constitute the administration agreement ( beheersregeling ) within the meaning of Article 3:168 DCC.

(v) For the avoidance of doubt, the parties hereto confirm that this Agreement is not to be construed as an agreement as referred to in Article 6:16 DCC and that Article 6:16 DCC shall not apply, and therefore, that the provisions relating to common property ( een gemeenschap ) within the meaning of Article 3:166 DCC shall not apply by analogy to the relationship between Agent and any Lender on the one hand and Stream BV on the other hand.

(vi) To the extent Agent irrevocably ( onaantastbaar ) receives any amount in payment of the Parallel Debt U.S. (the “ U.S. Received Amount ”), the U.S. Obligations shall be reduced by an aggregate amount (the “ U.S. Deductible Amount ”) equal to the U.S. Received Amount in the manner as if the U.S. Deductible Amount were received as a payment of the U.S. Obligations. For the avoidance of doubt, to the extent Agent irrevocably ( onaantastbaar ) receives any amount in payment of the U.S. Obligations, the Parallel Debt U.S. shall be reduced accordingly as if such payment was received as a payment of the Parallel Debt U.S.

SECTION 3. CONDITIONS; TERM OF AGREEMENT.

3.1. Conditions Precedent to the Initial Extension of Credit . The obligation of each Lender to make its initial extension of credit provided for hereunder, is subject to the fulfillment, to the satisfaction of Agent and, except as otherwise provided on Schedule 3.1 , each Lender of each of the conditions precedent set forth on Schedule 3.1 (the making of such initial extension of credit by a Lender being conclusively deemed to be its satisfaction or waiver of the conditions precedent).

3.2. Conditions Precedent to all Extensions of Credit . The obligation of the Lender Group (or any member thereof) to make any Advances hereunder (or to extend any other credit hereunder) at any time shall be subject to the following conditions precedent:

(a) the representations and warranties of the Borrowers or their respective Subsidiaries contained in this Agreement or in the other Loan Documents shall be true and correct in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof) on and as of the date of such extension of credit, as though made on and as of such date (except to the extent that such representations and warranties relate solely to an earlier date);

(b) no Default or Event of Default shall have occurred and be continuing on the date of such extension of credit, nor shall either result from the making thereof; and

(c) with respect to the making of any Foreign Advances to any Foreign Borrower by any Lender, in such Lender’s good faith determination, since the Closing Date, there has been no occurrence of a change in any Applicable Law that would render the making of the Advances by such Lender to such Foreign Borrower unlawful under such Applicable Law on the requested funding date.

3.3. Maturity . This Agreement shall continue in full force and effect for a term ending on October 1, 2013 (the “ Maturity Date ”). The foregoing notwithstanding, the Lender Group, upon the election of the Required Lenders, shall have the right, in accordance with Section 9.1 , to terminate its obligations under this Agreement upon the occurrence and during the continuation of an Event of Default.

 

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3.4. Effect of Termination . On the Maturity Date, all commitments of the Lender Group to provide additional credit hereunder shall automatically be terminated and all Obligations (including contingent reimbursement obligations of the Borrowers with respect to outstanding Letters of Credit and including all Bank Product Obligations) immediately shall become due and payable without notice or demand (and, as a part of such Obligations becoming due and payable, the Borrowers shall immediately and automatically be obligated to provide (a) Letter of Credit Collateralization, and (b) Bank Product Collateralization). No termination of the obligations of the Lender Group (other than payment in full of the Obligations and termination of the Commitments) shall relieve or discharge any Loan Party of its duties, Obligations, or covenants hereunder or under any other Loan Document and Agent’s Liens in the Collateral shall continue to secure the Obligations and shall remain in effect until all Obligations have been paid in full and the Commitments have been terminated. When all of the Obligations have been paid in full and the Lender Group’s obligations to provide additional credit under the Loan Documents have been terminated irrevocably, Agent will, at the Borrower’s sole expense, execute and deliver any termination statements, lien releases, discharges of security interests, and other similar discharge or release documents (and, if applicable, in recordable form) as are reasonably necessary to release, as of record, Agent’s Liens and all notices of security interests and liens previously filed by Agent with respect to the Obligations.

3.5. Early Termination by Borrowers . The Borrowers have the option, at any time upon 5 Business Days prior written notice by Administrative Borrower to Agent, to terminate this Agreement and terminate the Commitments hereunder by paying to Agent the Obligations (including (a) providing Letter of Credit Collateralization with respect to the then existing Letter of Credit Usage, and (b) providing Bank Product Collateralization with respect to the then existing Bank Products), in full.

3.6. Conditions Subsequent . The obligation of the Lender Group (or any member thereof) to continue to make Advances (or otherwise extend credit hereunder) is subject to the fulfillment, on or before the date applicable thereto, of the conditions subsequent set forth on Schedule 3.6 (the failure by Borrower to so perform or cause to be performed such conditions subsequent as and when required by the terms thereof, shall constitute an immediate Event of Default (it being understood and agreed that, to the extent that the existence of any such condition subsequent, or the failure to have satisfied such condition prior to the Closing Date, would otherwise cause any representation, warranty or covenant in this Agreement or any Loan Document to be breached, such breach shall not be deemed to have occurred to the extent such condition subsequent is satisfied as and when required pursuant to Schedule 3.6 )).

3.7. Conditions Precedent to the Philippines Entities Becoming Foreign Borrowing Base Parties . The obligation of the Lender Group (or any member thereof) to include Accounts owned by the Philippines Entities in the Foreign Borrowing Base is subject to the fulfillment, to the reasonable satisfaction of Agent or waiver by Agent, of each of the conditions precedent set forth on Schedule 3.7 ; it being understood and agreed that the Philippines Entities shall not become “Guarantors” or “Foreign Borrowing Base Parties” until the date (the “ Philippines Closing Date ”) that each of such conditions is fulfilled to the reasonable satisfaction of Agent (or waived by Agent).

3.8. Conditions Precedent to Stream Canada Becoming a Foreign Borrower . The obligation of the Lender Group (or any member thereof) to make Foreign Advances to the Stream Canada is subject to the fulfillment, to the reasonable satisfaction of Agent or waiver by Agent, of each of the conditions precedent set forth on Schedule 3.8 ; it being understood and agreed that Stream Canada shall not become a “Foreign Borrower” until the date (the “ Canadian Closing Date ”) that each of such conditions is fulfilled to the reasonable satisfaction of Agent (or waived by Agent).

 

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3.9. Conditions Precedent to Stream UK Becoming a Foreign Borrowing Base Party . The obligation of the Lender Group (or any member thereof) to include Accounts owned by Stream UK in the Foreign Borrowing Base is subject to the fulfillment, to the reasonable satisfaction of Agent or waiver by Agent, of each of the conditions precedent set forth on Schedule 3.9 ; it being understood and agreed that Stream UK shall not become a “Guarantor” or “Foreign Borrowing Base Party” until the date (the “ UK Closing Date ”) that each of such conditions is fulfilled to the reasonable satisfaction of Agent (or waived by Agent).

SECTION 4. REPRESENTATIONS AND WARRANTIES.

In order to induce the Lender Group to enter into this Agreement, each Borrower makes the following representations and warranties to the Lender Group which shall be true, correct, and complete, in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof), as of the date hereof, and shall be true, correct, and complete, in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof), as of the Closing Date, and shall be true, correct, and complete, in all material respects (except that such materiality qualifier shall not be applicable to any representations and warranties that already are qualified or modified by materiality in the text thereof), as of the date of the making of each Advance (or other extension of credit) made thereafter, as though made on and as of the date of such Advance (or other extension of credit) (except to the extent that such representations and warranties by their terms relate solely to an earlier date) and such representations and warranties shall survive the execution and delivery of this Agreement:

4.1. Due Organization and Qualification; Subsidiaries .

(a) Each Loan Party (i) is duly organized and existing and in good standing (or the local equivalent) under the laws of the jurisdiction of its organization, (ii) is qualified to do business in any jurisdiction where the failure to be so qualified could reasonably be expected to result in a Material Adverse Change, and (iii) has all requisite power and authority to own and operate its properties, to carry on its business as now conducted and as proposed to be conducted, to enter into the Loan Documents to which it is a party and to carry out the transactions contemplated thereby.

(b) Except as described on Schedule 4.1(b) , Parent is not subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital Stock or any security convertible into or exchangeable for any of its capital Stock.

(c) Set forth on Schedule 4.1(c) (as such Schedule may be updated from time to time by delivery of an updated schedule delivered with the quarterly Compliance Certificate, to reflect changes resulting from transactions permitted under this Agreement), is a complete and accurate list of the Loan Parties’ direct and indirect Subsidiaries, showing: (i) the number of shares of each class of common and preferred Stock authorized for each of such Subsidiaries, and (ii) the number and the percentage of the outstanding shares of each such class owned directly or indirectly by each Borrower. All of the outstanding capital Stock of each such Subsidiary has been validly issued and, in the case of any such corporate Subsidiary, is fully paid and non-assessable.

(d) Except as set forth on Schedule 4.1(d) , neither any Borrower (other than Parent) nor any of their respective Subsidiaries is subject to any obligation (contingent or otherwise) to repurchase or otherwise acquire or retire any shares of its capital Stock or any security convertible into or exchangeable for any of its capital Stock.

(e) There is no issued and outstanding Prohibited Preferred Stock of any Loan Party.

 

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4.2. Due Authorization; No Conflict.

(a) As to each Loan Party, the execution, delivery, and performance by such Loan Party of the Loan Documents to which it is a party have been duly authorized by all necessary action on the part of such Loan Party.

(b) As to each Loan Party, the execution, delivery, and performance by such Loan Party of the Loan Documents to which it is a party do not and will not (i) violate any material provision of any material federal, state, provincial or local law or regulation applicable to any Loan Party or its Subsidiaries or the Governing Documents of any Loan Party or its Subsidiaries, (ii) violate any order, judgment, decree of any court or other Governmental Authority binding on any Loan Party or its Subsidiaries (in each case that has not been stayed pending appeal), (iii) conflict with, result in a breach of, or constitute (with due notice or lapse of time or both) a default under any Material Contract of any Loan Party or its Subsidiaries except to the extent that any such conflict, breach or default could not individually or in the aggregate reasonably be expected to have a Material Adverse Change, (iv) result in or require the creation or imposition of any Lien of any nature whatsoever upon any assets of any Loan Party, other than Permitted Liens, or (v) require any approval of any Loan Party’s interestholders or any approval or consent of any Person under any Material Contract of any Loan Party, other than consents or approvals that have been obtained and that are still in force and effect and except, in the case of Material Contracts, for consents or approvals, the failure to obtain or maintain in full force and effect could not individually or in the aggregate reasonably be expected to cause a Material Adverse Change.

4.3. Governmental Consents . The execution, delivery, and performance by each Loan Party of the Loan Documents to which such Loan Party is a party and the consummation of the transactions contemplated by the Loan Documents do not and will not require any registration with, consent, or approval of, or notice to, or other action with or by, any Governmental Authority, other than (i) registrations, consents, approvals, notices or other actions that have been obtained and that are still in force and effect and (ii) filings and recordings with respect to the Collateral to be made, or otherwise delivered to Agent for filing or recordation.

4.4. Binding Obligations; Perfected Liens.

(a) Each Loan Document has been duly executed and delivered by each Loan Party that is a party thereto and is the legally valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its respective terms, except as enforcement may be limited by equitable principles or by bankruptcy, insolvency, reorganization, moratorium, or similar laws relating to or limiting creditors’ rights generally.

(b) Agent’s Liens on the Collateral are validly created, perfected (other than as contemplated or permitted under Section 6.11 or under the provisions of any other Loan Document, and subject only to the filing of financing statements, the recordation of the Copyright Security Agreement, and the recordation of the Mortgages, in each case, in the appropriate filing offices (to the extent required for perfection under Applicable Law)), and, other than as contemplated or permitted under Section 6.11 or any other Loan Documents, first priority Liens, subject only to Permitted Liens.

4.5. Title to Assets; No Encumbrances . Each of the Loan Parties and their respective Subsidiaries has (i) good, sufficient and legal and beneficial title to (in the case of fee interests in Real Property), (ii) valid leasehold interests in (in the case of leasehold interests in real or personal property), and (iii) good and marketable title to (in the case of all other personal property), all of their respective assets reflected in their most recent financial statements delivered pursuant to Section 5.1 , in each case except for (A) those assets that are not material to the conduct of the business of any Loan Party or Subsidiary thereof or (B) assets disposed of since the date of such financial statements to the extent permitted hereby. All of such assets are free and clear of Liens except for Permitted Liens.

 

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4.6. Jurisdiction of Organization; Location of Chief Executive Office; Organizational Identification Number; Commercial Tort Claims.

(a) The name of (within the meaning of Section 9-503 of the Code) and jurisdiction of organization of each Loan Party and each of its Subsidiaries is set forth on Schedule 4.6(a) (as such Schedule may be updated from time to time by delivery of an updated schedule delivered with the quarterly Compliance Certificate, to reflect changes resulting from transactions permitted under this Agreement).

(b) The chief executive office of each Loan Party and each of its Subsidiaries is located at the address indicated on Schedule 4.6(b) (as such Schedule may be updated from time to time by delivery of an updated schedule delivered with the quarterly Compliance Certificate, to reflect changes resulting from transactions permitted under this Agreement).

(c) Each Loan Party’s and each of its Subsidiaries’ tax identification numbers and organizational identification numbers, if any, are identified on Schedule 4.6(c) (as such Schedule may be updated from time to time by delivery of an updated schedule delivered with the quarterly Compliance Certificate, to reflect changes resulting from transactions permitted under this Agreement).

(d) As of the Closing Date, no Loan Party and no Subsidiary of a Loan Party holds any commercial tort claims that exceed $1,000,000 in amount, except as set forth on Schedule 4.6(d) .

4.7. Litigation.

(a) There are no actions, suits, claims or proceedings pending or, to the knowledge of the Borrowers threatened in writing against a Loan Party or any of its Subsidiaries that either individually or in the aggregate could reasonably be expected to result in a Material Adverse Change.

(b) Schedule 4.7 sets forth a complete and accurate description, with respect to each of the actions, suits, claims or proceedings with asserted liabilities in excess of, or that could reasonably be expected to result in liabilities in excess of, $1,000,000 that, as of the Closing Date, is pending or, to the knowledge of the Borrowers threatened in writing against a Loan Party or any of its Subsidiaries, of (i) as of the Closing Date, the parties to such actions, suits, or proceedings, (ii) the nature of the dispute that is the subject of such actions, suits, or proceedings, (iii) the status, as of the Closing Date, with respect to such actions, suits, or proceedings, and (iv) whether, as of the Closing Date, any liability of the Loan Parties’ and their Subsidiaries in connection with such actions, suits, or proceedings is covered by insurance.

4.8. Compliance with Laws . No Loan Party nor any of its Subsidiaries (a) is in violation of any applicable laws, rules, regulations, executive orders, or codes (including Environmental Laws) that, individually or in the aggregate, could reasonably be expected to result in Material Adverse Change, or (b) is subject to or in default with respect to any final judgments, writs, injunctions, decrees, rules or regulations of any court or any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Change.

4.9. No Material Adverse Change . All historical financial statements relating to the Loan Parties and their Subsidiaries that have been delivered by any Borrower to Agent in connection with the transactions contemplated by the Loan Documents, the Acquisition Documents and the Indenture Documents, have been prepared in accordance with GAAP (except (a) in the case of unaudited financial statements, for the lack of footnotes and being subject to year-end audit adjustments and (b) with respect to the historical financial information of certain of the Philippines Entities which have been prepared in accordance with the Philippine equivalent of GAAP) and present fairly in all material respects, the Loan Parties’ and their Subsidiaries’ consolidated financial condition as of the date thereof and results of operations for the period then ended. Since December 31, 2008, no event, circumstance, or change has occurred that has or could reasonably be expected to result in a Material Adverse Change with respect to the Loan Parties and their Subsidiaries.

 

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4.10. Fraudulent Transfer .

(a) The U.S. Borrowers, taken as a whole, are Solvent, the Foreign Borrowers, taken as a whole, are Solvent and the Loan Parties, taken as a whole, are Solvent.

(b) No transfer of property is being made by any Loan Party and no obligation is being incurred by any Loan Party in connection with the transactions contemplated by this Agreement or the other Loan Documents with the intent to hinder, delay, or defraud either present or future creditors of such Loan Party.

4.11. Employee Benefits .

(a) No Loan Party, nor any Loan Party Subsidiaries, nor any of their respective ERISA Affiliates, sponsors, maintains or contributes to, or has any liability, actual or contingent, with respect to: (a) any Benefit Plan; (b) any Canadian Pension Plan; or (c) any Multiemployer Plan. Except to the extent required under Section 4980B of the IRC, as expressly provided for in employment or severance agreements with individual executives or as described in Schedule 4.11, no Plan maintained in the United States provides health or other welfare benefits (through the purchase of insurance or otherwise) for any retired or former employee of any Loan Party or any of its Subsidiaries. The present value of the aggregate obligations under all Plans maintained outside the United States which provide health or other welfare benefits (through the purchase of insurance or otherwise) for any retired or former employee of any Loan Party or any of its Subsidiaries does not exceed $1,000,000 (as determined under GAAP).

(b) Each International Plan (i) has been maintained in all material respects in accordance with all Applicable Law and with its terms; (ii) if intended to qualify for special Tax treatment, meets all requirements for such treatment; and (iii) if required to be registered, has been registered with the appropriate Governmental Authorities and has been maintained in good standing with the appropriate regulatory authorities, except, for clauses (i) - (iii), as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change. Each International Plan is fully funded or has been fully accrued for on the financial statements of the applicable Loan Parties and their Subsidiaries, except as would not have a material adverse effect upon any such Loan Party or Subsidiary.

4.12. Environmental Condition . Except as set forth on Schedule 4.12 , (a) to the Borrowers’ knowledge no Loan Party’s nor any of its Subsidiaries’ properties or assets has ever been used by a Loan Party, its Subsidiaries, or by previous owners or operators in the disposal of, or to produce, store, handle, treat, release, or transport, any Hazardous Materials, where such disposal, production, storage, handling, treatment, release or transport was in violation, in any material respect, of any applicable Environmental Law, (b) to the Borrowers’ knowledge no Loan Party’s nor any of its Subsidiaries’ properties or assets has ever been designated or identified in any manner pursuant to any Environmental Laws as a Hazardous Materials disposal site (or any similar or analogous designation), (c) no Loan Party nor any of its Subsidiaries has received notice that an Environmental Lien has attached to or relates in any way to any Real Property owned or operated by a Loan Party or its Subsidiaries, or to any operations thereon, and (d) no Loan Party nor any of its Subsidiaries nor any of their respective facilities or operations is subject to any outstanding written order, consent decree, or settlement agreement with any Person relating to any Environmental Law or Environmental Liability that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Change.

4.13. Intellectual Property . Each Loan Party and its Subsidiaries own, or hold licenses in, all trademarks, trade names, copyrights, patents, (with respect to Canada) industrial designs and other intellectual property that are necessary to the conduct of its business as currently conducted, and attached hereto as Schedule 4.13 (as updated, to the extent required hereunder, from time to time) is a true, correct, and complete

 

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listing of all registered trademarks, trade names, registered copyrights, issued patents, (with respect to Canada) registered industrial designs and other material intellectual property as to which a Loan Party or a Subsidiary thereof is the owner or is an exclusive licensee; provided , however , that the Borrowers may amend Schedule 4.13 to add additional intellectual property acquired after the Closing Date so long as such amendment occurs by written notice to Agent delivered concurrently with the quarterly Compliance Certificate provided by Parent under the terms of this Agreement. ›

4.14. Leases . Each Loan Party and its Subsidiaries enjoy peaceful and undisturbed possession under all leases material to their business taken as a whole and to which they are parties or under which they are operating, and, subject to Permitted Protests, all of such material leases are valid and subsisting and no default by the applicable Loan Party or its Subsidiaries exists under any of them that would entitle the counterparty thereto, with the giving of notice and/or the passage of time, to terminate any such material lease.

4.15. Deposit Accounts and Securities Accounts . Set forth on Schedule 4.15 (as updated, to the extent required by the provisions of the Security Agreement or applicable Foreign Security Agreement from time to time) is a listing of all of the Loan Parties’ and their Subsidiaries’ Deposit Accounts and Securities Accounts, including, with respect to each bank or securities intermediary (a) the name and address of such Person, and (b) the account numbers of the Deposit Accounts or Securities Accounts maintained with such Person.

4.16. Complete Disclosure . All factual information taken as a whole (other than forward-looking information and projections and information of a general economic nature and general information about the Borrowers’ industry) furnished by or on behalf of a Loan Party or its Subsidiaries in writing to Agent or any Lender (including all information contained in the Schedules hereto or in the other Loan Documents) for purposes of or in connection with this Agreement or the other Loan Documents, the Acquisition Documents, the Indenture Documents, and all other such factual information taken as a whole (other than forward-looking information and projections and information of a general economic nature and general information about the Borrowers’ industry) hereafter furnished by or on behalf of a Loan Party or its Subsidiaries in writing to Agent or any Lender for purposes of or in connection with this Agreement or the other Loan Documents will be, true and accurate, in all material respects, on the date as of which such information is dated or certified and not incomplete by omitting to state any fact necessary to make such information (taken as a whole) not misleading in any material respect at such time in light of the circumstances under which such information was provided. The Projections delivered to Agent on September 10, 2009, and as of the date on which any other Projections are delivered to Agent, in each case in connection with this Agreement or any of the other Loan Documents, were, or when delivered shall be, prepared in good faith on the basis of information and assumptions believed by the Loan Parties’ and their Subsidiaries’ to be reasonable at the time of the delivery thereof to Agent (it being understood that such Projections are subject to uncertainties and contingencies, many of which are beyond the control of the Loan Parties and their Subsidiaries, that no assurances can be given that such Projections will be realized, and that actual results may differ in a material manner from such Projections).

4.17. Material Contracts . Set forth on Schedule 4.17 (as such Schedule may be updated as required by this Section 4.17 from time to time in accordance herewith) is a list of the Material Contracts of each Loan Party as of the most recent date on which the Borrowers provided their quarterly Compliance Certificate pursuant to Section 5.1 ; provided , however , that the Borrowers may amend Schedule 4.17 to add additional Material Contracts so long as such amendment occurs by written notice to Agent on the date that Parent provides its quarterly Compliance Certificate. Except for matters which, either individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Change, each Material Contract (other than those that have expired at the end of their normal terms) (a) is in full force and effect and is binding upon and enforceable against the applicable Loan Party and, to such Loan Party’s knowledge each other Person that is a party thereto in accordance with its terms, (b) has not been otherwise amended or modified (other than amendments or modifications permitted by Section 6.7(b) ), and (c) is not in default due to the action or inaction of the applicable Loan Party.

 

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4.18. Patriot Act . To the extent applicable, each Loan Party is in compliance, in all material respects, with the (a) Trading with the Enemy Act, as amended, and each of the foreign assets control regulations of the United States Treasury Department (31 CFR, Subtitle B, Chapter V, as amended) and any other enabling legislation or executive order relating thereto, (b) Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA Patriot Act of 2001) (the “ Patriot Act ”), (c) Part II.1 of the Criminal Code (Canada), (d) the Proceeds of Crime (money laundering) and Terrorist Financing Act (Canada) (the “ PCTFA ”), (e) the Regulations Implementing the United Nations Resolutions on the Suppression of Terrorism (Canada) and (f)  United Nations Al-Qaida and Taliban Regulations (Canada). No part of the proceeds of the loans made hereunder will be used by any Loan Party or any of their Affiliates, directly or indirectly, for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in violation of the United States Foreign Corrupt Practices Act of 1977, as amended.

4.19. Indebtedness . Set forth on Schedule 4.19 is a true and complete list of all Indebtedness of each Loan Party and each of its Subsidiaries in excess of $1,000,000 outstanding immediately prior to the Closing Date that is to remain outstanding immediately after giving effect to the closing hereunder on the Closing Date and such Schedule accurately sets forth the aggregate principal amount of such Indebtedness as of the Closing Date (or, if different, the date specified on Schedule 4.19 ).

4.20. Payment of Taxes . Except as otherwise permitted under Section 5.5 , all tax returns and reports of each Loan Party and its Subsidiaries required to be filed by any of them have been timely filed, and all federal taxes and other taxes which exceed $100,000 in the aggregate for all such taxes shown on such tax returns to be due and payable and all assessments, fees and other governmental charges upon a Loan Party and its Subsidiaries and upon their respective assets, income, businesses and franchises that are due and payable have been paid when due and payable. Each Loan Party and each of its Subsidiaries have made adequate provision in accordance with GAAP (or, with respect to any Loan Party or Subsidiary thereof that is organized under the laws of a country other than the United States, the equivalent of GAAP in such country) for all taxes not yet due and payable. No Borrower knows of any proposed tax assessment against a Loan Party or any of its Subsidiaries that is not being actively contested by such Loan Party or such Subsidiary diligently, in good faith, and by appropriate proceedings and reserves, if any, as shall be required in conformity with GAAP (or, with respect to any Loan Party or Subsidiary thereof that is organized under the laws of a country other than the United States, the equivalent of GAAP in such country) have been made or provided therefor.

4.21. Margin Stock . No Loan Party nor any of its Subsidiaries owns any Margin Stock. No part of the proceeds of the loans made to the Borrowers will be used to purchase or carry any such Margin Stock or to extend credit to others for the purpose of purchasing or carrying any such Margin Stock or for any purpose that violates the provisions of Regulation T, U or X of the Board of Governors of the United States Federal Reserve.

4.22. Governmental Regulation . No Loan Party nor any of its Subsidiaries is subject to regulation under the Federal Power Act or the Investment Company Act of 1940 or under any other federal or state statute or regulation which limits or could reasonably be expected to limit its ability to incur Indebtedness or which otherwise renders or could reasonably be expected to render all or any portion of the Obligations unenforceable. No Loan Party nor any of its Subsidiaries is a “registered investment company” or a company “controlled” by a “registered investment company” or a “principal underwriter” of a “registered investment company” as such terms are defined in the Investment Company Act of 1940.

4.23. OFAC . No Loan Party nor any of its Subsidiaries is in violation of any of the country or list based economic and trade sanctions administered and enforced by OFAC. No Loan Party nor any of its Subsidiaries (a) is a Sanctioned Person or a Sanctioned Entity, (b) has more than 10% of its assets located in Sanctioned Entities, or (c) derives more than 10% of its revenues from investments in, or transactions with Sanctioned Persons or Sanctioned Entities. The proceeds of any Advance will not be used to fund any operations in, finance any investments or activities in, or make any payments to, a Sanctioned Person or a Sanctioned Entity.

 

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4.24. Employee and Labor Matters . There is (i) no unfair labor practice complaint pending or, to the knowledge of the Borrowers threatened in writing against Parent or its Subsidiaries before any Governmental Authority and no grievance or arbitration proceeding pending or threatened in writing against Parent or its Subsidiaries which arises out of or under any collective bargaining agreement and that could reasonably be expected to result in a material liability, (ii) no strike, labor dispute, slowdown, stoppage or similar action or grievance pending or threatened in writing against Parent or its Subsidiaries (other than employee grievances arising in the ordinary course of business for which reserves in accordance with GAAP (or, with respect to any Loan Party or Subsidiary thereof that is organized under the laws of a country other than the United States, the equivalent of GAAP in such country) have been established on the books of Parent or such Subsidiary) that could reasonably be expected to result in a material liability, or (iii) to the knowledge of the Borrowers and except (x) as otherwise disclosed to Agent in writing from time to time or (y) for ordinary course activities occurring outside of the United States, no union representation question existing with respect to the employees of Parent or its Subsidiaries and no union organizing activity taking place with respect to any of the employees of Parent or its Subsidiaries. None of Parent or its Subsidiaries has incurred any material liability or material obligation under the Worker Adjustment and Retraining Notification Act or similar state law, which remains unpaid or unsatisfied after the date on which such liability or obligation is required to be paid or satisfied under such Act or law. The hours worked and payments made to employees of Parent and its Subsidiaries have not been in violation of the Fair Labor Standards Act or any other applicable legal requirements, except to the extent such violations could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change. All material payments, contributions, premiums and remittances on account of employee contributions and premiums due from Parent and its Subsidiaries on account of wages and employee health and welfare insurance and other benefits, including but not limited to retirement savings arrangements or money purchase pension plan arrangements, (“ Employee Benefit and Savings Plans ”) have been paid or, where applicable, accrued as a liability on the books of Parent in either case in accordance with the terms thereof and Applicable Laws, except where the failure to do so could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change. All Employee Benefit and Savings Plans have been maintained, funded and administered in material compliance with the terms thereof and in material compliance with Applicable Laws, except for noncompliance as would not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Change.

4.25. Parent as a Holding Company; Specified Subsidiaries .

(a) Parent is a holding company and does not have any material liabilities (other than liabilities arising under the Loan Documents and the Indenture Documents), own any material assets (other than (i) the Stock of its Subsidiaries and (ii) cash and Cash Equivalents in Deposit Accounts or Securities Accounts subject to Control Agreements) or engage in any operations or business (other than the ownership of its Subsidiaries) and activities incidental to any of the foregoing.

(b) No Specified Subsidiary has any liabilities, owns any assets having a value in excess of $250,000 at any time or engages itself in any operations or business giving rise to revenues for such Specified Subsidiary in excess of $250,000 during any 12-month period.

4.26. Indenture Documents .

(a) The Borrowers have delivered to Agent a complete and correct copy of the Indenture Documents, including all schedules and exhibits thereto. The execution, delivery and performance of each of the Indenture Documents has been duly authorized by all necessary action on the part of each applicable Loan Party or Subsidiary thereof. Each Indenture Document is the legal, valid and binding obligation of each applicable Loan Party or Subsidiary thereof, enforceable against such Loan Party or Subsidiary, as applicable, in accordance with its terms, in each case, except (i) as may be limited by applicable bankruptcy, insolvency,

 

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reorganization, moratorium or other similar laws relating to or affecting generally the enforcement of creditors’ rights and (ii) the availability of the remedy of specific performance or injunctive or other equitable relief is subject to the discretion of the court before which any proceeding therefor may be brought. As of the Closing Date, except as could not reasonably be expected to result in a Material Adverse Change (x) no Loan Party or Subsidiary thereof is in default in the performance or compliance with any provisions thereof, (y) all representations and warranties made by any Loan Party or Subsidiary thereof in the Indenture Documents and in the certificates delivered in connection therewith are true and correct in all material respects and (z) to the Borrowers’ knowledge none of the representations or warranties in the Indenture Documents contain any untrue statement of a material fact or omit any fact necessary to make the statements therein not misleading.

(b) As of the Closing Date, the transactions contemplated by the Indenture Documents have been consummated in all material respects, in accordance with all Applicable Laws. As of the Closing Date, all requisite approvals for the consummation of the transactions contemplated by the Indenture Documents by Governmental Authorities having jurisdiction over any Loan Party or Subsidiary thereof who is party to the Indenture Documents have been obtained, except for any approval the failure to obtain could not reasonably be expected to be materially adverse to the interests of the Lenders.

4.27. Acquisition Documents .

(a) The Borrowers have delivered to Agent a complete and correct copy of the material Acquisition Documents, including all schedules and exhibits thereto. The execution, delivery and performance of each of the Acquisition Documents has been duly authorized by all necessary action on the part of each applicable Loan Party or Subsidiary thereof. Each Acquisition Document is the legal, valid and binding obligation of each applicable Loan Party or Subsidiary thereof, enforceable against such Loan Party or Subsidiary, as applicable, in accordance with its terms, in each case, except (i) as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or affecting generally the enforcement of creditors’ rights and (ii) the availability of the remedy of specific performance or injunctive or other equitable relief is subject to the discretion of the court before which any proceeding therefor may be brought. As of the Closing Date, except as could not reasonably be expected to result in a Material Adverse Change (x) no Loan Party or Subsidiary thereof is in default in the performance or compliance with any provisions thereof, (y) all representations and warranties made by any Loan Party or Subsidiary thereof in the Acquisition Documents and in the certificates delivered in connection therewith are true and correct in all material respects and (z) to the Borrowers’ knowledge none of the Seller’s representations or warranties in the Acquisition Documents contain any untrue statement of a material fact or omit any fact necessary to make the statements therein not misleading.

(b) As of the Closing Date, the Acquisition has been consummated in all material respects, in accordance with all Applicable Laws. As of the Closing Date, all necessary approvals by Governmental Authorities having jurisdiction over any Loan Party or Subsidiary thereof who is party to the Acquisition and, to each Borrower’s knowledge, the Seller, with respect to the consummation of the Acquisition, have been obtained (including filings or approvals required under the Hart-Scott-Rodino Antitrust Improvements Act), except for any approval the failure to obtain could not reasonably be expected to be materially adverse to the interests of the Lenders. As of the Closing Date, after giving effect to the transactions contemplated by the Acquisition Documents, each applicable Loan Party will have good title to the assets acquired pursuant to the Acquisition Agreement, free and clear of all Liens other than Permitted Liens.

4.28. Eligible Accounts . As to each Account that is identified by a Borrower as an Eligible Account in a Borrowing Base Certificate submitted to Agent, such Account is (a) a bona fide existing payment obligation of the applicable Account Debtor created by the sale and delivery of Inventory or the rendition of services to such Account Debtor in the ordinary course of such Borrower’s business, (b) except as otherwise set forth on such Borrowing Base Certificate, owed to such Borrower without any known defenses, disputes, offsets, counterclaims, or rights of return or cancellation, and (c) not excluded as ineligible by virtue of one or more of the excluding criteria (other than Agent-discretionary criteria) set forth in the definition of Eligible Accounts.

 

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4.29. [ Intentionally Omitted ]

4.30. Locations of Tangible Personal Property . The tangible personal property (other than vehicles or Equipment out for repair) of the Loan Parties and their Subsidiaries material to the business of each Loan Party or its Subsidiary are not stored with a bailee, warehouseman, or similar party and are located only at, or in-transit between or to, the locations identified on Schedule 4.30 (as such Schedule may be updated pursuant to Section 5.15 ).

4.31. Limitations on Dividends and Other Payment Restrictions Affecting Subsidiaries . Other than the Loan Documents and the Indenture Documents, no Loan Party or Subsidiary thereof is party to or otherwise bound by any consensual encumbrance or consensual restriction of any kind on the ability of any Subsidiary of any Loan Party (i) to pay dividends or to make any other distribution on any shares of Stock of such Subsidiary owned by any Loan Party or any of its Subsidiaries, (ii) to pay or prepay or to subordinate any Indebtedness owed to any Loan Party or any of its Subsidiaries, (iii) to make loans or advances to any Loan Party or any of its Subsidiaries or (iv) to transfer any of its property or assets to any Loan Party or any of its Subsidiaries except for such encumbrances or restrictions existing under or by reason of (A) customary provisions restricting subletting or assignment of any lease governing a leasehold interest of a Subsidiary; (B) customary provisions restricting assignment of any agreement entered into by a Subsidiary in the ordinary course of business; (C) any Permitted Lien or any document or instrument governing or evidencing any Permitted Lien, so long as any such restriction relates only to the property subject to such Permitted Lien; (D) customary restrictions and conditions contained in any agreement relating to the disposition of any property permitted under Section 6.4 pending the consummation of such sale; (E) without affecting the Loan Parties’ obligations under Section 5.11 , customary provisions in partnership agreements, limited liability company organizational governance documents or other Governing Documents, asset sale and stock sale agreements and other similar agreements entered into in the ordinary course of business that restrict the transfer of ownership interests in such partnership, limited liability company or similar Person; (F) restrictions on cash or other deposits or net worth imposed by suppliers or landlords under contracts entered into in the ordinary course of business; (G) any instrument governing Permitted Indebtedness assumed in connection with any Permitted Acquisition, which encumbrance or restriction is not applicable to any Person, or the property of any Person, other than the Person or the property of the Person so acquired; (H) in the case of any joint venture that is not a Loan Party in respect of any matters referred to in clauses (iii) and (iv) above, restrictions in such Person’s Governing Documents or pursuant to any joint venture agreement or equityholders agreements solely to the extent of the Capital Stock of or property held in the subject joint venture or other entity; (I) negative pledges and restrictions on Liens in favor of any holder of Permitted Indebtedness, but solely to the extent any negative pledge expressly permits Liens for the benefit of Agent with respect to the Obligations on a senior basis without the requirement that such holders of such Permitted Indebtedness be secured by such Liens on an equal and ratable, or junior, basis; (J) any document or instrument governing or evidencing Permitted Purchase Money Indebtedness, so long as any such restriction contained therein relates only to the transfer of the asset or assets acquired, constructed, installed or improved with the proceeds of such Permitted Purchase Money Indebtedness, and (K) in addition to the foregoing clauses (A) through (J), any agreements that exist on the date hereof and are set forth on Schedule 4.19 , and to the extent such agreements evidence or govern Permitted Indebtedness, any agreements governing any Refinancing Indebtedness in respect thereof, so long as the agreements governing such Refinancing Indebtedness do not expand the scope of the encumbrance or restriction.

 

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SECTION 5. AFFIRMATIVE COVENANTS.

Each Borrower covenants and agrees that, until termination of all of the Commitments and payment in full of the Obligations, such Borrower shall, and shall cause the Loan Parties and their respective Subsidiaries to, comply with each of the following: ›

5.1. Financial Statements, Reports, Certificates . Deliver to Agent, with copies to each Lender, each of the financial statements, reports, and other items set forth on Schedule 5.1 no later than the times specified therein. In addition, the Borrowers agree that no Subsidiary of any Loan Party will have a fiscal year different from that of Parent. In addition, the Borrowers agree to maintain a system of accounting that enables Parent to produce financial statements in accordance with GAAP. Each Loan Party shall also (a) keep a reporting system consistent with good business practices that shows, in all material respects, all additions, sales, claims, returns, and allowances with respect to its and its Subsidiaries’ sales, and (b) maintain its billing systems/practices as approved by Agent prior to the Closing Date and shall only make material modifications thereto (other than modifications made to integrate EGS and its Subsidiaries into the billing systems of Parent and its other Subsidiaries) with notice to, and with the consent of, Agent, such consent not to be unreasonably withheld or delayed.

5.2. Collateral Reporting . Provide Agent with each of the reports set forth on Schedule 5.2 at the times specified therein. In addition, the Loan Parties agree to use commercially reasonable efforts in cooperation with Agent to facilitate and implement a system of electronic collateral reporting in order to provide electronic reporting of each of the items set forth on such Schedule.

5.3. Existence . Except as otherwise permitted under Section 6.3 or Section 6.4 , at all times maintain and preserve in full force and effect its existence (including being in good standing in its jurisdiction of organization) and all rights and franchises, licenses and permits material to its business; provided , however , that no Borrower, nor any of its Subsidiaries, shall be required to preserve any such right or franchise, licenses or permits if such Person’s Board of Directors shall reasonably determine that the preservation thereof is no longer desirable in the conduct of such Person’s business and that the loss thereof is not disadvantageous, in any material respect, to such Person.

5.4. Maintenance of Properties . Maintain and preserve all of its assets that are necessary or useful in the proper conduct of its business in good working order and condition, ordinary wear, tear, and casualty excepted and Permitted Dispositions excepted, and comply with the material provisions of all material leases to which it is a party as lessee, so as to prevent the loss or forfeiture thereof, unless such provisions are the subject of a Permitted Protest.

5.5. Taxes . Timely file all tax returns and cause all federal taxes and assessments and other taxes and assessments which equal or exceed, in the aggregate for all such taxes, $100,000 imposed, levied, or assessed against any Loan Party or its Subsidiaries, or any of their respective assets or in respect of any of its income, businesses, or franchises to be paid and discharged in full, before delinquency and before the expiration of any extension period, except to the extent that the validity of such assessment or tax shall be the subject of a Permitted Protest. Parent will and will cause each of its Subsidiaries to make timely payment or deposit of all tax payments and withholding taxes required of it and them by Applicable Laws, including those laws concerning F.I.C.A., F.U.T.A., state disability, and local, state, provincial and federal income and sales taxes, and will, upon request, furnish Agent with proof reasonably satisfactory to Agent indicating that Parent and its Subsidiaries have made such payments or deposits.

5.6. Insurance . At the Borrowers’ expense, maintain insurance respecting each of the Loan Parties’ and their respective Subsidiaries’ assets wherever located, covering loss or damage by fire, theft, explosion, and all other hazards and risks as ordinarily are insured against by other Persons engaged in the same or similar businesses. The Borrowers also shall maintain (with respect to each of the Loan Parties and their respective Subsidiaries) business interruption, general liability, director’s and officer’s liability, fiduciary liability and employment practices liability insurance, as well as insurance against larceny, embezzlement, and criminal misappropriation. All such policies of insurance shall be with responsible and reputable insurance companies acceptable to Agent in its Permitted Discretion and in such amounts as is carried generally in accordance with sound business practice by companies in similar businesses similarly situated and located and in any event in amount, adequacy and scope reasonably satisfactory to Agent. All property insurance policies covering the Collateral are to be made payable to Agent for the benefit of Agent and the Lenders, as their

 

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interests may appear, in case of loss, pursuant to a standard loss payable endorsement with a standard non contributory “lender” or “secured party” clause and are to contain such other provisions as Agent may reasonably require to fully protect the Lenders’ interest in the Collateral and to any payments to be made under such policies. All certificates of property and general liability insurance are to be delivered to Agent, with the loss payable (but only in respect of Collateral) and additional insured endorsements in favor of Agent and shall provide for not less than 30 days (10 days in the case of non-payment) prior written notice to Agent of the exercise of any right of cancellation. If the Borrowers fail to maintain such insurance, Agent may arrange for such insurance, but at the Borrowers’ expense and without any responsibility on Agent’s part for obtaining the insurance, the solvency of the insurance companies, the adequacy of the coverage, or the collection of claims. The Borrowers shall give Agent prompt notice of any loss exceeding $1,000,000 covered by their casualty or business interruption insurance. Upon the occurrence and during the continuance of an Event of Default, the Borrowers agree, to the extent permitted under any applicable insurance policy, Agent shall have the right to file claims under any property and general liability insurance policies in respect of Collateral, to receive, receipt and give acquittance for any payments that may be payable thereunder, and to execute any and all endorsements, receipts, releases, assignments, reassignments or other documents that may be necessary to effect the collection, compromise or settlement of any claims under any such insurance policies.

5.7. Inspection . Permit Agent and each of its duly authorized representatives or agents to visit any of its properties and inspect any of its assets or books and records, to conduct appraisals and valuations, to examine and make copies of its books and records, and to discuss its affairs, finances, and accounts with, and to be advised as to the same by, its officers and employees at such reasonable times and intervals as Agent may designate and, so long as no Default or Event of Default exists, with reasonable prior notice to Administrative Borrower.

5.8. Compliance with Laws . Comply with the requirements of all applicable laws, rules, regulations, and orders of any Governmental Authority, other than laws, rules, regulations, and orders the non-compliance with which, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Change.

5.9. Environmental .

(a) Keep any property either owned or operated by the Loan Parties free of any Environmental Liens or post bonds or other financial assurances sufficient to satisfy the obligations or liability evidenced by such Environmental Liens,

(b) Except where failure to do so could not reasonably be expected to result in material liability to any Loan Party, comply with applicable Environmental Laws and provide to Agent documentation of such compliance which Agent reasonably requests,

(c) Promptly notify Agent of any release of a Hazardous Material, at or above a reportable quantity, at, on, from or, to the knowledge of any Loan Party, migrating onto property owned or operated by any Loan Party and take any Remedial Actions required to abate said release or otherwise to come into compliance, in all material respects, with applicable Environmental Law, and

(d) Promptly, but in any event within 10 days of its receipt thereof, provide Agent with written notice of any of the following: (i) notice that an Environmental Lien has been filed against any of the real or personal property of any Loan Party, (ii) commencement of any Environmental Action or written notice that an Environmental Action will be filed against any Loan Party which could reasonably be expected to result in material liability to such Loan Party, and (iii) written notice of a violation, citation, or administrative order issued pursuant to or in relation to any Environmental Law (whether from a Governmental Authority or otherwise) which could reasonably be expected to result in material liability to any Loan Party.

 

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5.10. Disclosure Updates . Promptly and in no event later than 10 days after obtaining knowledge thereof, notify Agent if any written information, exhibit, or report furnished by or on behalf of any Loan Party to the Lender Group (other than forward-looking information, projections and information of a general economic nature and general information about the Borrowers’ industry) in connection with this Agreement, the other Loan Documents or the transactions contemplated by or referenced herein contained, at the time it was furnished, any untrue statement of a material fact or omitted to state any material fact necessary to make the statements contained therein not misleading in light of the circumstances in which made. The foregoing to the contrary notwithstanding, any notification pursuant to the foregoing provision will not cure or remedy the effect of the prior untrue statement of a material fact or omission of any such material fact nor shall any such notification have the effect of amending or modifying this Agreement or any of the Schedules hereto.

5.11. Formation of Subsidiaries . At the time that any Loan Party forms any direct or indirect Subsidiary or acquires any direct or indirect Subsidiary (other than another Loan Party) after the Closing Date, such Loan Party shall (a) within 15 days of such formation or acquisition (or such later date as permitted by Agent in its sole discretion) cause any such new Subsidiary to provide to Agent a joinder to the Guaranty and the Security Agreement, together with such other security documents (including Mortgages with respect to any Real Property owned in fee of such new Subsidiary with a cost or book value of at least $500,000, determined on a per property basis), as well as appropriate financing statements (and with respect to all property subject to such a mortgage, fixture filings), all in form and substance reasonably satisfactory to Agent (including being sufficient to grant Agent a Lien (subject only to Permitted Liens) in and to the assets of such newly formed or acquired Subsidiary to the extent constituting Collateral); provided that, with respect to any Subsidiary of a Loan Party that is a CFC, (x) the Guaranty, the Security Agreement, and such other security documents shall not be required to be provided to Agent if providing such documents would reasonably be expected to result in taxable income to Parent of more than $50,000 pursuant to IRC Section 951(a)(1)(B) for the taxable year in which such CFC would become a Loan Party, and (y) such CFC shall provide a Foreign Guaranty and Foreign Security Agreement (or, in each case, a joinder thereto), and such other security documents in order to guarantee the Foreign Obligations on a secured basis unless the costs to the Loan Parties of providing such Foreign Guaranty, executing any security documents or perfecting the security interests created thereby are excessive (as determined by Agent in its Permitted Discretion in consultation with Parent) in relation to the benefits of Agent and the Lenders of the security or guarantee afforded thereby, (b) within 15 days (or 30 days in the case of any Subsidiary of a Loan Party that is a CFC) of such formation or acquisition (or such later date as permitted by Agent in its sole discretion) provide to Agent a pledge agreement (or an addendum or joinder to the Security Agreement or applicable Foreign Security Agreement) and appropriate certificates and powers and/or financing statements, providing a Lien on all of the direct or beneficial ownership interest in such new Subsidiary reasonably satisfactory to Agent; provided that only 65% of the total outstanding Voting Stock of any first tier Subsidiary of any Loan Party that is a CFC (and none of the Stock of any Subsidiary of such CFC) shall be required to be pledged if pledging a greater amount would result in adverse tax consequences or the costs to the Loan Parties of providing such pledge or perfecting the security interests created thereby are excessive (as determined by Agent in its Permitted Discretion in consultation with Loan Parties) in relation to the benefits of Agent and the Lenders of the security or guarantee afforded thereby (which Lien, if reasonably requested by Agent, shall be governed by the laws of the jurisdiction of such Subsidiary); provided , further , and notwithstanding the foregoing, that so long as such direct or beneficial ownership interest in such new Subsidiary does not constitute collateral for the Indebtedness under the Indenture Documents, then no “securities” of any of such Loan Party’s “affiliates” (as the terms “securities” and “affiliates” are used in Rule 3-16 of Regulation S-X under the Securities Act of 1933, as amended) shall be required to be pledged pursuant to this clause (b), and (c) within 15 days (or 30 days in the case of any Subsidiary of a Loan Party that is a CFC) of such formation or acquisition (or such later date as permitted by Agent in its sole discretion) provide to Agent all other documentation, including one or more opinions of counsel reasonably satisfactory to Agent, which in its Permitted Discretion is appropriate with respect to the execution and delivery of the applicable documentation referred to above (including policies of title insurance or other documentation with respect to all Real Property owned in fee and subject to a Mortgage). Any document, agreement, or instrument executed or issued pursuant to this Section 5.11 shall be a Loan Document.

 

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5.12. Further Assurances . At any time upon the reasonable request of Agent, execute or deliver to Agent any and all financing statements, fixture filings, security agreements, pledges, assignments, endorsements of certificates of title (if any), Mortgages, policies of title insurance, deeds of trust, opinions of counsel, and all other documents (collectively, the “ Additional Documents ”) that Agent may reasonably request in form and substance reasonably satisfactory to Agent, to create, perfect, and continue perfected or to better perfect Agent’s Liens in all of the assets of each of the Loan Parties and their respective Subsidiaries (whether now owned or hereafter arising or acquired, tangible or intangible, real or personal), to create and perfect Liens in favor of Agent in any Real Property owned in fee and acquired by any Loan Party or Subsidiary thereof after the Closing Date with a cost or book value in excess of $500,000, calculated on a per property basis, and in order to fully consummate all of the transactions contemplated hereby and under the other Loan Documents; provided that, with respect to any Subsidiary of a Loan Party that is a CFC, (x) such Additional Documents shall not be required to be provided to Agent if providing such documents would reasonably be expected to result in taxable income to Parent of more than $50,000 pursuant to IRC Section 951(a)(1)(B) for the taxable year in which such CFC would become a Loan Party, and (y) such CFC shall provide such Additional Documents in order to guarantee on a secured basis the Foreign Obligations unless the costs to the Loan Parties of providing such Additional Documents are excessive (as determined by Agent in its Permitted Discretion in consultation with Parent) in relation to the benefits of Agent and the Lenders of the benefits afforded thereby. To the maximum extent permitted by Applicable Law, each Borrower authorizes Agent to execute any such Additional Documents in the applicable Loan Party’s or Subsidiary’s name, as applicable, and authorizes Agent to file such executed Additional Documents in any appropriate filing office. In furtherance and not in limitation of the foregoing, but subject to the third proviso of Section 5.11 , each Loan Party shall take such actions as Agent may reasonably request from time to time to ensure that the Obligations are guarantied by the Guarantors and are secured by all of the assets of the Loan Parties and their respective Subsidiaries that constitute Collateral (subject to exceptions and limitations contained in the Loan Documents with respect to CFCs).

5.13. Lender Meetings . Within 90 days after the close of each fiscal year of Parent (and at any time following the occurrence and during the continuance of an Event of Default), at the request of Agent or of the Required Lenders and upon reasonable prior notice and during normal business hours, hold a meeting (at a mutually agreeable location and time or (a) at the option of Agent at any time when an Event of Default shall have occurred and be continuing, by conference call or (b) at the option of Parent at any time when an Event of Default shall not have occurred and be continuing, by conference call) with all Lenders who choose to attend such meeting at which meeting shall be reviewed the financial results of the previous fiscal year and the financial condition of Parent and its Subsidiaries and the Projections presented for the current fiscal year of Parent.

5.14. Material Contracts . Contemporaneously with the delivery of each quarterly Compliance Certificate pursuant to Section 5.1 , provide Agent with copies of (a) each Material Contract entered into since the delivery of the previous quarterly Compliance Certificate, and (b) each material amendment or modification of any Material Contract entered into since the delivery of the previous quarterly Compliance Certificate.

5.15. Location of Tangible Personal Property . Keep the tangible personal property (other than Equipment out for repair) material to the business of each Loan Party or its Subsidiary only at the locations identified on Schedule 4.30 and their chief executive offices only at the locations identified on Schedule 4.6(b) ; provided , however , that the Borrowers may amend Schedule 4.30 or Schedule 4.6(b) so long as such amendment occurs by written notice to Agent not less than 10 days prior to the date on which such tangible personal property is moved to such new location or such chief executive office is relocated and so long as such new location is within the United States or the country under whose laws such Loan Party or Subsidiary is organized, and so long as, at the time of such written notification, except with respect to locations at which the book value of the tangible personal property in question is less than $500,000 and is not a location at which material books and records relating to Accounts are located, the Loan Party or Subsidiary thereof provides Agent a Collateral Access Agreement with respect thereto (unless a Collateral Access Agreement is already in effect with respect to such location).

 

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5.16. Assignable Material Contracts . Use commercially reasonable efforts (which shall not include the payment of more than a de minimis fee or other amount) to ensure that any Material Contract entered into after the Closing Date by any Loan Party or Subsidiary thereof that generates or, by its terms, will generate revenue, permits the assignment of such agreement (and all rights of such Loan Party or Subsidiary thereof, as applicable, thereunder) to such Loan Party’s or Subsidiary’s lenders or an agent for any such lenders (and any transferees of such lenders or such agent, as applicable).

5.17. Collections; Foreign Accounts .

(a) Each Loan Party shall (i) establish and maintain cash management services of a type and on terms reasonably satisfactory to Agent at one or more of the banks set forth on Schedule 5.17(a) (each, a “ Controlled Account Bank ”), and shall instruct all of its and its Subsidiaries’ Account Debtors to forward payment of the amounts owed by them directly to such Controlled Account Bank, and (ii) deposit or cause to be deposited promptly, and in any event no later than the second Business Day after the date of receipt thereof, all of their Collections (including those sent directly by their Account Debtors to a Loan Party) into a bank account of such Loan Party (each, a “ Controlled Account ”) at one of the Controlled Account Banks.

(b) Each Loan Party shall establish and maintain Controlled Account Agreements with Agent and the applicable Controlled Account Bank, in form and substance reasonably acceptable to Agent. Each such Controlled Account Agreement shall provide, among other things, that (i) the Controlled Account Bank will comply with any instructions originated by Agent directing the disposition of the funds in such Controlled Account without further consent by the applicable Loan Party, (ii) the Controlled Account Bank waives, subordinates, or agrees not to exercise any rights of setoff or recoupment or any other claim against the applicable Controlled Account other than for payment of its service fees and other charges directly related to the administration of such Controlled Account and for returned checks or other items of payment, and (iii) upon the instruction of Agent (an “ Activation Instruction ”), the Controlled Account Bank will forward by daily (on each business day of such Controlled Account Bank) sweep all amounts in the applicable Controlled Account to the Agent’s Account. Agent agrees (x) not to issue an Activation Instruction with respect to any of the Controlled Accounts unless a Triggering Event has occurred and is continuing at the time such Activation Instruction is issued and (y) to rescind any such Activation Notice promptly following the date on which (1) no Default or Event of Default has occurred and is continuing and (2) Excess Availability has been greater than or equal to $20,000,000 during a period of 30 consecutive day period following the date such Activation Notice was issued and Excess Availability (as applied only to the U.S. Borrowers) has been greater than or equal to $10,000,000 during a period of 30 consecutive day period following the date such Activation Notice was issued.

(c) So long as no Event of Default has occurred and is continuing, Loan Parties may amend Schedule 5.17(a) to add or replace a Controlled Account Bank or Controlled Account; provided , however , that (i) such prospective Controlled Account Bank shall be reasonably satisfactory to Agent, and (ii) prior to or concurrently with the time of the opening of such Controlled Account, the applicable Loan Party and such prospective Controlled Account Bank shall have executed and delivered to Agent a Controlled Account Agreement. Each Loan Party shall close any of its Controlled Accounts (and establish replacement Controlled Accounts in accordance with the foregoing sentence) as promptly as practicable and in any event within 45 days, following notice from Agent that the operating performance, funds transfer, or availability procedures or performance of the Controlled Account Bank with respect to Controlled Accounts or Agent’s liability under any Controlled Account Agreement with such Controlled Account Bank is no longer acceptable, in Agent’s reasonable judgment, in the case of each of the foregoing, due solely to such Controlled Account Bank’s credit-worthiness or failure to comply with any Controlled Account Agreement or other Control Agreement.

 

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(d) Dutch Cash Management.

(i) On or before the Closing Date, the Loan Parties shall have provided to Agent evidence, in form and substance satisfactory to Agent, that PNC Bank, N.A. shall have released all of its right, title and interest in and to all amounts deposited to deposit accounts numbered 601979311 and 500473307 maintained in the name of PNC Bank, N.A. for the benefit of Stream BV at ABN AMRO Bank N.V. (“ ABN ”) and that PNC Bank, N.A. shall have instituted a daily (on each business day of such bank) sweep of all funds deposited in such accounts to a deposit account of Stream BV established at a financial institution acceptable to Agent in its Permitted Discretion located in the Netherlands (the “ Dutch Bank ”) for the receipt of Collections subject to a pledge under the laws of the Netherlands for the benefit of Agent (a “ BV Collection Account ”).

(ii) Within 15 days after the Closing Date, each Loan Party (other than Parent, Stream Holdco, Stream International, Stream NY, Stream Canada and the Philippines Entities) shall have instructed all of its Account Debtors to pay all proceeds of Accounts to a BV Collection Account.

(iii) Within 15 days after the Closing Date, Stream BV and SGS BV shall each have established, with a Dutch Bank, for the payment by each such Borrower of its obligations in the ordinary course of its business in the Netherlands, an operations account subject to a pledge under the laws of the Netherlands for the benefit of Agent (each a “ BV Operations Account ”).

(iv) Stream BV shall use commercially reasonable efforts to, within 15 days after the Closing Date, ensure that the relevant Dutch Bank shall confirm and take notice of the pledge of the BV Collection Accounts and the BV Operations Accounts to Agent and waive any rights of pledge, set-off and retention with respect thereto substantially in the form of the Bank Notice (as defined in the Relevant Dutch Deed of Pledge of Bank Accounts); provided , however , if the foregoing condition shall not have been met within such 15 day period, Stream BV shall promptly notify Agent thereof, then, on or before the date that is 45 days after the Closing Date, either (a) (i) each Loan Party (other than Parent, Stream Holdco, Stream International, Stream NY, Stream Canada and the Philippines Entities) shall have instructed all of their respective Account Debtors to pay all proceeds of Accounts to a BV Collection Account at a Dutch Bank that will comply with the provisions of the following clause (a)(iii), (ii) each of Stream BV and SGS BV shall each have established, with such Dutch Bank, a BV Operations Account, (iii) such Loan Parties shall ensure that such Dutch Bank shall confirm and take notice of the pledge of the BV Collection Accounts and the BV Operations Accounts to Agent and waive any rights of pledge, set-off and retention with respect thereto or (b) have instructed all of their respective Account Debtors to pay all proceeds of Accounts to a bank account established in the name of Agent with a Dutch Bank for the collection of such Loan Party’s Accounts (each an “ Agent BV Collection Account ”).

(v) If the Agent BV Collection Account is established, until a Triggering Event has occurred, Agent shall transf