Second Amended and Restated Credit Agreement

FIRST AMENDMENT TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

 

Exhibit 10.5

EXECUTION VERSION

FIRST AMENDMENT
TO SECOND AMENDED AND RESTATED CREDIT AGREEMENT

This First Amendment to Second Amended and Restated Credit Agreement (this “Amendment”) is made as of December 14, 2018, by and among:

PIER 1 IMPORTS (U.S.), INC., a Delaware corporation with its principal executive offices at 100 Pier 1 Place, Fort Worth, Texas 76102 (the “Borrower”);

The FACILITY GUARANTORS party hereto;

The LENDERS party hereto;

BANK OF AMERICA, N.A., a national banking association with offices at 100 Federal Street, Boston, Massachusetts 02110, as administrative agent (in such capacity, the “Administrative Agent”) and as collateral agent (in such capacity, the “Collateral Agent”) for its own benefit and the benefit of the other Credit Parties; and

PATHLIGHT CAPITAL FUND I LP, a Delaware limited partnership, in its capacity as agent for the ABL Term Lenders (in such capacity, the “ABL Term Loan Agent”).

in consideration of the mutual covenants herein contained and benefits to be derived here from.

W I T N E S S E T H:

WHEREAS, reference is made to that certain Second Amended and Restated Credit Agreement, dated as of June 2, 2017 (as amended, restated, supplemented, extended or otherwise modified prior to the date hereof, the “Existing Credit Agreement”, and the Existing Credit Agreement, as amended by this Amendment, and as may be further amended, amended and restated, restated, supplemented, extended or otherwise modified and in effect from time to time is referred to herein as the “Credit Agreement”)), by and among, inter alias, (i) the Borrower, (ii) the Facility Guarantors party thereto, (iii) the Lenders party thereto, and (iv) Bank of America, N.A., as Administrative Agent and Collateral Agent;

WHEREAS, the Borrower has requested, among other things, that the Administrative Agent, the Collateral Agent and the Required Lenders agree to (a) the ABL Term Lenders making the ABL Term Loans to the Borrower pursuant to this Amendment, (b) the FILO Lenders making the FILO Loans to the Borrower pursuant to this Amendment and (c) amend certain other provisions of the Existing Credit Agreement, in each case, subject to the terms and conditions set forth herein.

WHEREAS, the Borrower, the Facility Guarantors, the Required Lenders, the FILO Lenders, the ABL Term Lenders, the ABL Term Loan Agent, the Administrative Agent and the Collateral Agent have agreed, on the terms and conditions set forth herein, (a) to the ABL Term Lenders making the ABL Term Loan to the Borrower, (b) to the FILO Lenders making the FILO Loans to the Borrower and (c) to amend certain other provisions of the Existing Credit Agreement.

 


 

NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

1.

Defined Terms. Unless otherwise defined herein, capitalized terms used in this Amendment shall have the respective meanings assigned to such terms in the Credit Agreement.

2.

Amendments to the Credit Agreement.

 

(a)

The Existing Credit Agreement is hereby amended to delete the bold, stricken text (indicated textually in the same manner as the following example: stricken-text) and to add the bold, double-underlined text (indicated textually in the same manner as the following example: double-underlined text) as set forth in the pages of the Credit Agreement attached as Exhibit A hereto.

 

(b)

Schedule 1.1 (Lenders and Commitments) to the Existing Credit Agreement is hereby deleted and replaced in its entirety by the Schedule 1.1 (Lenders and Commitments) attached hereto as Annex I.

 

(c)

Exhibit A (Form of Assignment and Acceptance) to the Existing Credit Agreement is hereby deleted and replaced in its entirety by Exhibit A attached hereto as Annex II.

 

(d)

The Existing Credit Agreement is hereby amended by adding a new Exhibit D‑1 (Form of FILO Note) to the Credit Agreement in the form attached hereto as Annex III.

 

(e)

The Existing Credit Agreement is hereby amended by adding a new Exhibit D‑2 (Form of ABL Term Note) to the Credit Agreement in the form attached hereto as Annex IV.

 

(f)

Exhibit G (Form of Compliance Certificate) to the Existing Credit Agreement is hereby deleted and replaced in its entirety by Exhibit G attached hereto as Annex V.

 

(g)

Exhibit H (Form of Borrowing Base Certificate) to the Existing Credit Agreement is hereby deleted and replaced in its entirety by Exhibit H attached hereto as Annex VI.

3.

Ratification of Loan Documents. Each of the Loan Parties agrees that, after giving effect to this Amendment and except as otherwise expressly provided herein, all terms and conditions of the Credit Agreement, the Guarantee and the other Loan Documents remain in full force and effect, and each such Person reaffirms and confirms the continued validity of, and ratifies each Loan Document to which it is a party and agrees and confirms that it will perform and observe on and after the First Amendment Effective Date (as defined below), all Obligations (including, without limitation, the Revolving and FILO Obligations, and the ABL Term Obligations), covenants and agreements to be performed by it under and in accordance with the Credit Agreement and the other Loan Documents.

 


 

Each of the Loan Parties hereby ratifies, confirms, and reaffirms that all representations and warranties of the Loan Parties contained in the Credit Agreement and other Loan Documents or otherwise made in writing in connection therewith are true and correct in all material respects as of the date hereof, except to the extent that (i) such representations and warranties are qualified as to “materiality”, “Material Adverse Effect” or similar language, in which case they shall be true and correct in all respects (as so qualified by “materiality”, “Material Adverse Effect” or similar language), and (ii) such representations and warranties relate to an earlier date, in which case they shall be true and correct in all material respects on and as of such earlier date; provided that the representations and warranties set forth in Sections 3.01, 3.05, 3.09, 3.12, 3.14 and 3.18 of the Credit Agreement which set forth information as of the Effective Date shall be deemed to have been made, and the information contained therein shall be true and correct, as of the First Amendment Effective Date as updated pursuant to the terms of the Information Certificate. Each of the Facility Guarantors hereby acknowledges, restates, confirms and agrees that the Guaranteed Obligations (as defined in the Facility Guarantee) include, without limitation, all Obligations (including, without limitation, the Revolving and FILO Obligations, and the ABL Term Obligations) of the Loan Parties at any time (including, without limitation, Obligations incurred prior to the date hereof) and from time to time outstanding under the Credit Agreement and the other Loan Documents, as such Obligations (including, without limitation, the Revolving and FILO Obligations, and the ABL Term Obligations) have been amended pursuant to this Amendment. Each Loan Party hereby acknowledges, ratifies, restates and affirms to the Administrative Agent, the Collateral Agent, the ABL Term Loan Agent, and each other Credit Party its grant of a continuing security interest and lien on, and hereby grants a security interest and lien on, all of the Collateral in favor of the Collateral Agent and each Credit Party as security for the Obligations (including, without limitation, the Revolving and FILO Obligations, and the ABL Term Obligations), in each case, subject to no other Liens (other than Permitted Encumbrances). The Loan Parties hereby acknowledge, confirm and agree (i) that the Security Documents and any and all Collateral previously pledged (except to the extent expressly released prior to the First Amendment Effective Date) to the Collateral Agent, for the benefit of the Credit Parties, pursuant thereto, shall continue to secure all applicable Obligations (including, without limitation, the Revolving and FILO Obligations, and the ABL Term Obligations) of the Loan Parties at any time and from time to time outstanding under the Credit Agreement and the other Loan Documents, as such Obligations (including, without limitation, the Revolving and FILO Obligations, and the ABL Term Obligations) have been amended pursuant to this Amendment, and (ii) nothing herein shall nor is it intended to (A) constitute a novation or accord and satisfaction with respect to the Loan Documents or (B) operate as a waiver of any right, power or remedy of the Administrative Agent, the Collateral Agent, the ABL Term Loan Agent, any ABL Term Lender or the other Lenders under any Loan Document.

4.

Appointment of ABL Term Loan Agent. Effective as of the First Amendment Effective Date, the Existing Credit Agreement is hereby amended to add Pathlight Capital LLC as ABL Term Loan Agent and, from and after such date, such Person will be bound by the terms of the Credit Agreement relating to the ABL Term Loan Agent.

 


 

5.

Joinder of ABL Term Lenders; Acknowledgments of ABL Term Lenders.

 

(a)

Each ABL Term Lender, by its signature below, confirms that it has agreed to become a “Lender” and an “ABL Term Lender” under, and as defined in, the Credit Agreement holding ABL Term Loans in the amount set forth opposite such ABL Term Lender’s name on Schedule 1.1 attached hereto, effective on the First Amendment Effective Date. Each ABL Term Lender (i) acknowledges that in connection with it becoming a Lender and an ABL Term Lender it has received a copy of the Credit Agreement (including all schedules and exhibits thereto), together with copies of the most recent financial statements delivered by the Borrower pursuant to the Existing Credit Agreement, and such other documents and information as it has deemed appropriate to make its own credit and legal analysis and decision to become a Lender and an ABL Term Lender; and (ii) agrees that, upon it becoming a Lender and an ABL Term Lender on the First Amendment Effective Date, it will, independently and without reliance upon the Administrative Agent, the Collateral Agent, the ABL Term Loan Agent, any Issuing Bank or any other Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit and legal decisions in taking or not taking action under the Credit Agreement. In addition, each ABL Term Lender represents and warrants that (x) it is duly organized and existing and it has full power and authority to take, and has taken, all action necessary to execute and deliver this Amendment and to consummate the transactions contemplated hereby and to become a Lender and an ABL Term Lender on the First Amendment Effective Date, and (y) no notices to, or consents, authorizations or approvals of, any Person are required (other than any already given or obtained) for its due execution and delivery of this Amendment or the performance of its obligations hereunder or as a Lender or an ABL Term Lender under the Credit Agreement as of the date hereof Each ABL Term Lender acknowledges and agrees that, on the First Amendment Effective Date, such ABL Term Lender shall become a Lender and an ABL Term Lender and, from and after such date such ABL Term Lender will be bound by the terms of the Credit Agreement.

 

(b)

Each ABL Term Lender acknowledges that it has had the opportunity to request and has received such documents and information as it has deemed material or desirable or otherwise appropriate in making its evaluation and credit analysis of the Borrower and the other Loan Parties and its decision to become an ABL Term Lender and make an ABL Term Loan to the Borrower. Each ABL Term Lender has carefully reviewed such documents and information and, independently and without reliance upon the ABL Term Loan Agent, performed its own investigation and credit analysis of the ABL Term Loans, this Amendment and the transactions contemplated hereby and the creditworthiness of the Borrower and the other Loan Parties. Each ABL Term Lender acknowledges that the ABL Term Loan Agent and its Affiliates’ activities in connection with the ABL Term Loans, this Amendment and the transactions contemplated hereby are undertaken by the ABL Term Loan Agent or such Affiliates as a principal on an arm’s-length basis and neither ABL Term Loan Agent nor any of its Affiliates has any fiduciary, advisory or similar responsibilities in favor of such ABL Term Lender in connection with the ABL

 


 

 

Term Loans, this Amendment or the transactions contemplated hereby or the process related thereto. Each of the ABL Term Lenders hereby waives and releases, to the fullest extent permitted by law, any claims that it may have against the ABL Term Loan Agent or any of its Affiliates with respect to any breach or alleged breach of agency or fiduciary duty. In connection with all aspects of each transaction contemplated hereby, each ABL Term Lender acknowledges and agrees that: (i) ABL Term Loan Agent and its Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of such ABL Term Lender and its Affiliates, and neither ABL Term Loan Agent nor any of its Affiliates has any obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary relationship, (ii) ABL Term Loan Agent has not provided and will not provide any legal, accounting, regulatory or tax advice with respect to any of the transactions contemplated hereby and such ABL Term Lender has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, (iii) neither ABL Term Loan Agent nor any of its Affiliates bears any responsibility (or shall be liable) for the accuracy or completeness (or lack thereof) of any documents or information provided to such ABL Term Lender in connection with the ABL Term Loans, this Amendment and the transactions contemplated hereby; no representation regarding any such documents or information is made by the ABL Term Loan Agent or any of its Affiliates; neither the ABL Term Loan Agent nor any of its Affiliates has made any independent verification as to the accuracy or completeness of any such documents or information; and ABL Term Loan Agent and its Affiliates shall have no obligation to update or supplement any such documents or information or otherwise provide additional information. In connection with the transaction contemplated hereby, including its decision to become an ABL Term Lender and to make an ABL Term Loan to the Borrower, each ABL Term Lender acknowledges and agrees that it is not relying upon any representations or warranties made by the ABL Term Loan Agent or any of its Affiliates or, except as expressly set forth in this Amendment and the other Loan Documents, any other Person.

6.

Joinder of FILO Lenders; Acknowledgments of FILO Lenders.

 

(a)

Each FILO Lender, by its signature below, confirms that it has agreed to become a “Lender” and a “FILO Lender” under, and as defined in, the Credit Agreement holding FILO Loans in the amount set forth opposite such FILO Lender’s name on Schedule 1.1 attached hereto, effective on the First Amendment Effective Date. Each FILO Lender (i) acknowledges that in connection with it becoming a Lender and a FILO Lender it has received a copy of the Credit Agreement (including all schedules and exhibits thereto), together with copies of the most recent financial statements delivered by the Borrower pursuant to the Existing Credit Agreement, and such other documents and information as it has deemed appropriate to make its own credit and legal analysis and decision to become a Lender and a FILO Lender; and (ii) agrees that, upon it becoming a Lender and a FILO Lender on the First Amendment Effective Date, it will, independently and without reliance upon the Administrative Agent, the Collateral Agent, the ABL Term Loan Agent, any Issuing Bank or any other Lender and based on such documents and information as

 


 

 

it shall deem appropriate at the time, continue to make its own credit and legal decisions in taking or not taking action under the Credit Agreement. In addition, each FILO Lender represents and warrants that (x) it is duly organized and existing and it has full power and authority to take, and has taken, all action necessary to execute and deliver this Amendment and to consummate the transactions contemplated hereby and to become a Lender and a FILO Lender on the First Amendment Effective Date and (y) no notices to, or consents, authorizations or approvals of, any Person are required (other than any already given or obtained) for its due execution and delivery of this Amendment or the performance of its obligations hereunder or as a Lender or a FILO Lender under the Credit Agreement as of the date hereof. Each FILO Lender acknowledges and agrees that, on the First Amendment Effective Date, such FILO Lender shall become a Lender and a FILO Lender and, from and after such date such FILO Lender will be bound by the terms of the Credit Agreement.

 

(b)

Each FILO Lender acknowledges that it has had the opportunity to request and has received such documents and information as it has deemed material or desirable or otherwise appropriate in making its evaluation and credit analysis of the Borrower and the other Loan Parties and its decision to become a FILO Lender and make a FILO Loan to the Borrower. Each FILO Lender has carefully reviewed such documents and information and, independently and without reliance upon the Administrative Agent and/or the Collateral Agent, performed its own investigation and credit analysis of the FILO Loans, this Amendment and the transactions contemplated hereby and the creditworthiness of the Borrower and the other Loan Parties. Each FILO Lender acknowledges that the Administrative Agent’s, the Collateral Agent’s, and their respective Affiliates’ activities in connection with the FILO Loans, this Amendment and the transactions contemplated hereby are undertaken by the Administrative Agent, the Collateral Agent or such Affiliates as a principal on an arm’s-length basis and neither the Administrative Agent nor the Collateral Agent nor any of their respective Affiliates has any fiduciary, advisory or similar responsibilities in favor of such FILO Lender in connection with the FILO Loans, this Amendment or the transactions contemplated hereby or the process related thereto. Each of the FILO Lenders hereby waives and releases, to the fullest extent permitted by law, any claims that it may have against the Administrative Agent, the Collateral Agent or any of their respective Affiliates with respect to any breach or alleged breach of agency or fiduciary duty. In connection with all aspects of each transaction contemplated hereby, each FILO Lender acknowledges and agrees that: (i) the Administrative Agent, the Collateral Agent and their respective Affiliates may be engaged in a broad range of transactions that involve interests that differ from those of such FILO Lender and its Affiliates, and neither the Administrative Agent nor the Collateral Agent nor any of their respective Affiliates has any obligation to disclose any of such interests by virtue of any advisory, agency or fiduciary relationship, (ii) neither the Administrative Agent nor the Collateral Agent has provided and will provide any legal, accounting, regulatory or tax advice with respect to any of the transactions contemplated hereby and such FILO Lender has consulted its own legal, accounting, regulatory and tax advisors to the extent it has deemed appropriate, (iii) neither Administrative Agent

 


 

 

nor the Collateral Agent nor any of their respective Affiliates bears any responsibility (or shall be liable) for the accuracy or completeness (or lack thereof) of any documents or information provided to such FILO Lender in connection with the FILO Loans, this Amendment and the transactions contemplated hereby; no representation regarding any such documents or information is made by the Administrative Agent, the Collateral Agent or any of their respective Affiliates; neither the Administrative Agent nor the Collateral Agent nor any of their respective Affiliates has made any independent verification as to the accuracy or completeness of any such documents or information; and the Administrative Agent, the Collateral Agent and their respective Affiliates shall have no obligation to update or supplement any such documents or information or otherwise provide additional information. In connection with the transaction contemplated hereby, including its decision to become a FILO Lender and to make a FILO Loan to the Borrower, each FILO Lender acknowledges and agrees that it is not relying upon any representations or warranties made by the Administrative Agent, the Collateral Agent or any of their respective Affiliates or, except as expressly set forth in this Amendment and the other Loan Documents, any other Person.

7.

Conditions to Effectiveness of Amendment. This Amendment shall become effective as of the date first written above (the “First Amendment Effective Date”) upon the satisfaction of each of the following conditions precedent:

 

(a)

Documentation. The Administrative Agent and the ABL Term Loan Agent (or their respective counsel) shall have each received all of the following, in each case, in form and substance reasonably satisfactory to each of the Administrative Agent and the ABL Term Loan Agent:

 

(i)

this Amendment duly executed and delivered by the Borrower, the Facility Guarantors, the Administrative Agent, the Collateral Agent, the Issuing Bank, the ABL Term Loan Agent, and the Lenders party hereto (including the ABL Term Lenders and the FILO Lenders);

 

(ii)

the Information Certificate duly executed and delivered by the Loan Parties;

 

(iii)

a FILO Note executed by the Borrowers in favor of each FILO Lender requesting a FILO Note;

 

(iv)

an ABL Term Note executed by the Borrowers in favor each ABL Term Lender requesting an ABL Term Note;

 

(v)

a customary written opinion (addressed to the Administrative Agent, the Collateral Agent, and the ABL Term Loan Agent and dated the First Amendment Effective Date) of Sidley Austin LLP, Miles & Stockbridge P.C., and Davies Ward Phillips & Vineberg LLP, counsel for the Loan Parties, covering such matters relating to the Loan Parties, in form and substance reasonably satisfactory to the Administrative Agent and the ABL Term Loan Agent;

 


 

 

(vi)

Charter Documents and such other documents and certificates as the Administrative Agent and the ABL Term Loan Agent or their respective counsel may reasonably request relating to the organization, existence and good standing of each Loan Party, the authorization of the transactions contemplated by this Amendment and the other Loan Documents, and any other legal matters relating to the Loan Parties, this Amendment, the other Loan Documents or the transactions contemplated thereby, all in form and substance reasonably satisfactory to the Administrative Agent, the ABL Term Loan Agent, and their respective counsel;

 

(vii)

a Borrowing Base Certificate dated December 14, 2018, executed by a Financial Officer of the Borrower;

 

(viii)

results of searches or other evidence reasonably satisfactory to the Administrative Agent and the ABL Term Loan Agent (in each case dated as of a date reasonably satisfactory to the Administrative Agent and the ABL Term Loan Agent) indicating the absence of Liens on the assets of the Loan Parties, except for Permitted Encumbrances;

 

(ix)

a certificate reasonably satisfactory to the Administrative Agent and the ABL Term Loan Agent, (A) with respect to the Solvency of the Loan Parties as of the First Amendment Effective Date, and (B) certifying that (1) all representations and warranties contained in this Amendment and the other Loan Documents or otherwise made in writing in connection herewith or therewith are true and correct in all material respects as of the First Amendment Effective Date with the same effect as if made on and as of such date, except to the extent that (I) such representations and warranties are qualified as to “materiality”, “Material Adverse Effect” or similar language, in which case they are true and correct in all respects (as so qualified by “materiality”, “Material Adverse Effect” or similar language) on and as of such date, and (II) such representations and warranties relate to an earlier date, in which case they are true and correct in all material respects on and as of such earlier date, and (2) as of the Effective Date, no Default or Event of Default exists; and

 

(x)

to the extent not previously delivered, there shall have been delivered to the Agents the additional instruments and documents described in the Information Certificate.

 

(b)

Borrowings. Borrowings of the Revolving Credit Loans on the First Amendment Effective Date shall not be in excess of $0 in the aggregate.

 

(c)

Insurance. The Administrative Agent and the ABL Term Loan Agent shall have received, and be reasonably satisfied with, evidence of the Loan Parties’ insurance, together with such endorsements as are required by the Loan Documents.

 


 

 

(d)

Consents and Approvals. All necessary consents and approvals to this Amendment shall have been obtained, other than those the failure of which to obtain would not reasonably be expected to have a Material Adverse Effect.

 

(e)

Payment of Fees. All fees payable to the Administrative Agent, the Collateral Agent, the ABL Term Loan Agent, the Arrangers and the Lenders, if any, and all reasonable and documented out-of-pocket expenses for which the Borrower is obligated to reimburse the Administrative Agent, the Collateral Agent, the ABL Term Loan Agent, and the Arrangers pursuant to the Loan Documents shall have been paid.

 

(f)

No Default or Event of Default. After giving effect to this Amendment, no Default or Event of Default shall exist.

 

(g)

No Material Adverse Effect. Since March 3, 2018, there has been no event or circumstance, either individually or in the aggregate, that has had or could reasonably be expected to have a Material Adverse Effect.

 

(h)

Litigation. The absence of any action, suit, investigation or proceeding pending or, to the knowledge of the Borrower, threatened in writing in any court or before any arbitrator or governmental authority in which there is a reasonable possibility of a decision which would reasonably be expected to have a Material Adverse Effect.

 

(i)

Filings. To the extent not previously delivered, the Agents and the ABL Term Loan Agent shall have received all documents and instruments, including Uniform Commercial Code and PPSA financing statements, certified statements issued by the Quebec Register of Personal and Moveable Property Rights and any amendments in respect of any of the foregoing, required by law or reasonably requested by the Agents or the ABL Term Loan Agent to be filed, registered, published or recorded to create or perfect the first priority Liens intended to be created under the Loan Documents and substantially concurrently herewith, all such documents and instruments shall be so filed, registered, published or recorded to the satisfaction of the Agents and the ABL Term Loan Agent, and all filing and recording fees and taxes in connection therewith shall be duly paid.

8.

Representations and Warranties.

 

(a)

The transactions contemplated hereby are within each Loan Party’s corporate powers and have been duly authorized by all necessary corporate, membership, partnership or other necessary action. This Amendment has been duly executed and delivered by each Loan Party that is a party hereto and this Amendment and the other Loan Documents to which any Loan Party is a party, when executed and delivered by such Loan Party, will constitute a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

 

(b)

The transactions to be entered into and contemplated by this Amendment (a) do not require any consent or approval of, registration or filing with, or any other action

 


 

 

by, any Governmental Authority, except for such as have been obtained or made and are in full force and effect and except filings and recordings necessary to perfect Liens created under the Loan Documents, (b) will not violate any Applicable Law or the Charter Documents of any Loan Party, (c) will not violate or result in a default under any Material Contract, any indenture or any other agreement, instrument or other evidence of Material Indebtedness or other material instrument binding upon any Loan Party or its assets, or give rise to a right thereunder to require any payment to be made by any Loan Party, except to the extent that such violation or default would not reasonably be expected to result in a Material Adverse Effect, and (d) will not result in the creation or imposition of any Lien on any asset of any Loan Party, except Liens created under the Loan Documents and, subject to the Intercreditor Agreement, Liens in favor of the Term Agent to secure the Loan Parties’ obligations under the Term Loan Documents.

8.Miscellaneous.

 

(a)

This Amendment may be executed in counterparts (and by different parties hereto on different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract. This Amendment and the other Loan Documents constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all contemporaneous or previous agreements and understandings, oral or written, relating to the subject matter hereof This Amendment shall become effective when it shall have been executed by the applicable Credit Parties and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto, and thereafter shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns. Delivery of an executed counterpart of a signature page of this Amendment by telecopy or e-mail shall be effective as delivery of a manually executed counterpart of this Amendment.

 

(b)

Any provision of this Amendment held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof, and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

 

(c)

NOTICE OF INDEMNIFICATION: THE BORROWER AND FACILITY GUARANTORS HEREBY ACKNOWLEDGE AND AGREE THAT THE CREDIT AGREEMENT AND THE SECURITY DOCUMENTS CONTAIN CERTAIN INDEMNIFICATION PROVISIONS (INCLUDING, WITHOUT LIMITATION, THOSE CONTAINED IN SECTION 9.03 OF THE CREDIT AGREEMENT), WHICH IN CERTAIN CIRCUMSTANCES, COULD INCLUDE AN INDEMNIFICATION OF THE AGENTS AND THE CREDIT PARTIES FROM CLAIMS OR LOSSES ARISING AS A RESULT OF THE AGENTS’ AND THE LOAN PARTIES’ OWN NEGLIGENCE OR ON ACCOUNT OF CLAIMS OF STRICT LIABILITY.

 


 

 

(d)

The Loan Parties represent and warrant that they have consulted with independent legal counsel of their selection in connection with this Amendment and are not relying on any representations or warranties of the Agents or the Lenders or their counsel in entering into this Amendment.

 

(e)

THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK; PROVIDED, HOWEVER, THAT IF ANY LAWS OF ANY JURISDICTION OTHER THAN NEW YORK SHALL GOVERN IN REGARD TO THE VALID PERFECTION OR EFFECT OF PERFECTION OF ANY LIEN OR IN REGARD TO PROCEDURAL MATTERS AFFECTING ENFORCEMENT OF ANY LIENS IN COLLATERAL, SUCH LAWS OF SUCH OTHER JURISDICTIONS SHALL CONTINUE TO APPLY TO THAT EXTENT.

 


 

IN WITNESS WHEREOF, the parties have hereunto caused this Amendment to be executed and their seals to be hereto affixed as of the date first above written.

 

PIER 1 IMPORTS (U.S.), INC., as Borrower

 

 

 

 

 

 

 

 

 

 

 

 

By:

 

/s/ Nancy A. Walsh

 

 

Name:

 

Nancy A. Walsh

 

 

Title:

 

Executive Vice President and

Chief Financial Officer

 

 

 

 

 

 

PIER 1 IMPORTS, INC., as a Facility Guarantor

PIER 1 ASSETS, INC., as a Facility Guarantor

PIER 1 LICENSING, INC., as a Facility Guarantor

PIER 1 HOLDINGS, INC., as a Facility Guarantor

 

 

 

By:

 

/s/ Nancy A. Walsh

 

 

Name:

 

Nancy A. Walsh

 

 

Title:

 

Executive Vice President and

Chief Financial Officer

 

 

 

 

 

 

PIER 1 SERVICES, INC., as a Facility Guarantor

 

 

By:

 

Pier 1 Holdings, Inc., Managing Trustee

 

By:

 

/s/ Nancy A. Walsh

 

 

Name:

 

Nancy A. Walsh

 

 

Title:

 

Executive Vice President and

Chief Financial Officer

 

 

 

 

 

 

PIER 1 VALUE SERVICES, LLC, as a Facility Guarantor

 

 

 

 

 

By:

 

Pier 1 Imports (U.S.), Inc., its sole member and manager

 

By:

 

/s/ Nancy A. Walsh

 

 

Name:

 

Nancy A. Walsh

 

 

Title:

 

Executive Vice President and

Chief Financial Officer

 


 

 

BANK OF AMERICA, N.A., as Administrative Agent, as Collateral Agent, as Swingline Lender, and as a Lender

 

 

 

 

 

 

 

 

 

 

 

By:

 

/s/ Andrew Cerussi

 

 

Name:

 

Andrew Cerussi

 

 

Title:

 

Director

 

PATHLIGHT CAPITAL FUND I LP, as ABL Term Loan Agent

 

 

 

 

 

By:

 

Pathlight Partners GP LLC, its General Partner

 

 

 

 

 

 

 

 

 

 

 

 

By:

 

/s/ Katie Hendricks

 

 

 

 

Name:

 

Katie Hendricks

 

 

 

 

Title:

 

Managing Director

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

WELLS FARGO BANK, NATIONAL ASSOCIATION, as a Lender

 

 

 

 

 

By:

 

/s/ Jai Alexander

 

 

Name:

 

Jai Alexander

 

 

Title:

 

Director

 

U.S. BANK NATIONAL ASSOCIATION, as a Lender

 

 

 

 

 

By:

 

/s/ Thomas P. Chidester

 

 

Name:

 

Thomas P. Chidester

 

 

Title:

 

Vice President

 


 

 

ROYAL BANK OF CANADA, as a Lender

 

 

 

 

 

By:

 

/s/ Anna Bernat

 

 

Name:

 

Anna Bernat

 

 

Title:

 

Attorney In Fact

 

 

 

 

 

 

 

 

 

 

By:

 

/s/ Andrew J. Chaykoski

 

 

Name:

 

Andrew J. Chaykoski

 

 

Title:

 

Authorized Signatory

 

 

 

 

 

 

 

 

 

 

 

 

Address:

 

Royal Bank Plaza, N. Tower

 

 

 

 

200 Bay Street - 12th Floor

 

 

 

 

Toronto, ON, M5J 2J5

 

PATHLIGHT CAPITAL FUND I LP, as ABL Term Loan Agent

 

 

 

 

 

By:

 

Pathlight Partners GP LLC, its General Partner

 

 

 

 

 

 

 

 

 

 

 

 

By:

 

/s/ Katie Hendricks

 

 

 

 

Name:

 

Katie Hendricks

 

 

 

 

Title:

 

Managing Director

 

PATHLIGHT CAPITAL LLC, as ABL Term Loan Agent

 

 

 

 

 

By:

 

/s/ Katie Hendricks

 

 

Name:

 

Katie Hendricks

 

 

Title:

 

Managing Director

 

 

 


 

Exhibit A

Composite Credit Agreement

Please see attached.

 

 

 


 

[Execution Version]

SECOND AMENDED AND RESTATED CREDIT AGREEMENT

dated as of
June 2, [2017] 2017,
as amended December 14, 2018

 

PIER 1 IMPORTS (U.S.), INC.
as Borrower

 

THE FACILITY GUARANTORS NAMED HEREIN

 

BANK OF AMERICA, N.A.
as Administrative Agent and Collateral Agent

and

PATHLIGHT CAPITAL,
as ABL Term Loan Agent

and

THE LENDERS NAMED HEREIN

 

WELLS FARGO BANK, NATIONAL ASSOCIATION
and
U.S. BANK NATIONAL ASSOCIATION
as Co-Syndication Agents
JPMORGAN CHASE BANK, N.A.
as Documentation Agent

and

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
WELLS FARGO BANK, NATIONAL ASSOCIATION
as Joint Lead Arrangers and Joint Lead Bookrunners


 


 

TABLE OF CONTENTS

 

ARTICLE I Amount and Terms of Credit

 

2

 

 

 

 

SECTION 1.01

 

Definitions

 

2

 

 

 

 

 

 

 

SECTION 1.02

 

Terms Generally

 

60

 

 

 

 

 

 

 

SECTION 1.03

 

Accounting Terms; GAAP

 

61

 

 

 

 

 

 

 

SECTION 1.04

 

Rounding.

 

61

 

 

 

 

 

 

 

SECTION 1.05

 

Times of Day.

 

61

 

 

 

 

 

 

 

SECTION 1.06

 

Letter of Credit Amounts

 

61

 

 

 

 

 

 

 

SECTION 1.07

 

Timing of Performance

 

61

 

 

 

 

 

 

 

SECTION 1.08

 

Divisions.

 

62

 

 

 

 

 

 

ARTICLE II Amount and Terms of Credit

 

63

 

 

 

 

SECTION 2.01

 

Commitment of the Lenders

 

63

 

 

 

 

 

 

 

SECTION 2.02

 

Increase in []Revolving Commitments

 

64

 

 

 

 

 

 

 

SECTION 2.03

 

Reserves; Changes to Reserves.

 

66

 

 

 

 

 

 

 

SECTION 2.04

 

Making of Loans

 

66

 

 

 

 

 

 

 

SECTION 2.05

 

Overadvances

 

68

 

 

 

 

 

 

 

SECTION 2.06

 

Swingline Loans

 

68

 

 

 

 

 

 

 

SECTION 2.07

 

Notes

 

69

 

 

 

 

 

 

 

SECTION 2.08

 

Interest on Loans

 

70

 

 

 

 

 

 

 

SECTION 2.09

 

Conversion and Continuation of Revolving Credit Loans.

 

70

 

 

 

 

 

 

 

SECTION 2.10

 

Alternate Rate of Interest for Total Loans.

 

71

 

 

 

 

 

 

 

SECTION 2.11

 

Change in Legality

 

73

 

 

 

 

 

 

 

SECTION 2.12

 

Default Interest.

 

73

 

 

 

 

 

 

 

SECTION 2.13

 

Letters of Credit.

 

73

 

 

 

 

 

 

 

SECTION 2.14

 

Increased Costs.

 

78

 

 

 

 

 

 

 

SECTION 2.15

 

Optional Termination or Reduction of Commitments.

 

79

 

 

 

 

 

 

 

SECTION 2.16

 

Optional Prepayment of Loans; Reimbursement of Lenders.

 

79

 

 

 

 

 

 

 

SECTION 2.17

 

Mandatory Prepayment; Commitment Termination; Cash Collateral

 

82

 

 

 

 

 

 

 

SECTION 2.18

 

Cash Management

 

85

 

 

 

 

 

 

 

SECTION 2.19

 

Fees

 

89

 

 

 

 

 

 

ii

 


 

 

SECTION 2.20

 

Maintenance of Loan Account; Statements of Account

 

90

 

 

 

 

 

 

 

SECTION 2.21

 

Payments

 

90

 

 

 

 

 

 

 

SECTION 2.22

 

Settlement Amongst Lenders

 

92

 

 

 

 

 

 

 

SECTION 2.23

 

Taxes.

 

93

 

 

 

 

 

 

 

SECTION 2.24

 

Mitigation Obligations; Replacement of Lenders

 

98

 

 

 

 

 

 

 

SECTION 2.25

 

Security Interests in Collateral

 

99

 

 

 

 

 

 

 

SECTION 2.26

 

Defaulting Lenders

 

99

 

 

 

 

 

 

ARTICLE III Representations and Warranties

 

102

 

 

 

 

SECTION 3.01

 

Organization; Powers

 

102

 

 

 

 

 

 

 

SECTION 3.02

 

Authorization; Enforceability.

 

102

 

 

 

 

 

 

 

SECTION 3.03

 

Governmental Approvals; No Conflicts

 

102

 

 

 

 

 

 

 

SECTION 3.04

 

Financial Condition.

 

103

 

 

 

 

 

 

 

SECTION 3.05

 

Properties

 

103

 

 

 

 

 

 

 

SECTION 3.06

 

Litigation and Environmental Matters

 

103

 

 

 

 

 

 

 

SECTION 3.07

 

Compliance with Laws and Agreements

 

104

 

 

 

 

 

 

 

SECTION 3.08

 

Investment Company Status

 

104

 

 

 

 

 

 

 

SECTION 3.09

 

Taxes.

 

104

 

 

 

 

 

 

 

SECTION 3.10

 

ERISA.

 

104

 

 

 

 

 

 

 

SECTION 3.11

 

Disclosure.

 

105

 

 

 

 

 

 

 

SECTION 3.12

 

Subsidiaries

 

106

 

 

 

 

 

 

 

SECTION 3.13

 

Insurance.

 

106

 

 

 

 

 

 

 

SECTION 3.14

 

Labor Matters.

 

106

 

 

 

 

 

 

 

SECTION 3.15

 

Security Documents.

 

107

 

 

 

 

 

 

 

SECTION 3.16

 

Federal Reserve Regulations.

 

107

 

 

 

 

 

 

 

SECTION 3.17

 

Solvency.

 

107

 

 

 

 

 

 

 

SECTION 3.18

 

DDAs; Credit Card Arrangements

 

107

 

 

 

 

 

 

 

SECTION 3.19

 

Licenses; Permits.

 

108

 

 

 

 

 

 

 

SECTION 3.20

 

Material Contracts.

 

108

 

 

 

 

 

 

 

SECTION 3.21

 

OFAC; Sanctions

 

108

 

 

 

 

 

 

ARTICLE IV Conditions

 

109

 

 

 

 

SECTION 4.01

 

Effective Date

 

109

 

 

 

 

 

 

iii

 


 

 

SECTION 4.02

 

Conditions Precedent to Each Revolving Credit Loan and Each Letter of Credit

 

110

 

 

 

 

 

 

ARTICLE V Affirmative Covenants

 

112

 

 

 

 

SECTION 5.01

 

Financial Statements and Other Information

 

112

 

 

 

 

 

 

 

SECTION 5.02

 

Notices of Material Events

 

114

 

 

 

 

 

 

 

SECTION 5.03

 

Information Regarding Collateral

 

115

 

 

 

 

 

 

 

SECTION 5.04

 

Existence; Conduct of Business.

 

116

 

 

 

 

 

 

 

SECTION 5.05

 

Payment of Obligations.

 

116

 

 

 

 

 

 

 

SECTION 5.06

 

Maintenance of Properties.

 

116

 

 

 

 

 

 

 

SECTION 5.07

 

Insurance.

 

116

 

 

 

 

 

 

 

SECTION 5.08

 

Books and Records; Inspection and Audit Rights; Appraisals; Accountants.

 

117

 

 

 

 

 

 

 

SECTION 5.09

 

Physical Inventories.

 

118

 

 

 

 

 

 

 

SECTION 5.10

 

Compliance with Laws.

 

118

 

 

 

 

 

 

 

SECTION 5.11

 

Use of Proceeds and Letters of Credit.

 

119

 

 

 

 

 

 

 

SECTION 5.12

 

Additional Subsidiaries.

 

119

 

 

 

 

 

 

 

SECTION 5.13

 

Compliance with Terms of Leaseholds.

 

119

 

 

 

 

 

 

 

SECTION 5.14

 

Material Contracts.

 

120

 

 

 

 

 

 

 

SECTION 5.15

 

Further Assurances.

 

120

 

 

 

 

 

 

ARTICLE VI Negative Covenants

 

121

 

 

 

 

SECTION 6.01

 

Indebtedness and Other Obligations

 

121

 

 

 

 

 

 

 

SECTION 6.02

 

Liens.

 

121

 

 

 

 

 

 

 

SECTION 6.03

 

Fundamental Changes,

 

121

 

 

 

 

 

 

 

SECTION 6.04

 

Investments, Loans, Advances, Guarantees and Acquisitions

 

122

 

 

 

 

 

 

 

SECTION 6.05

 

Asset Sales.

 

122

 

 

 

 

 

 

 

SECTION 6.06

 

Restricted Payments; Certain Payments of Indebtedness

 

122

 

 

 

 

 

 

 

SECTION 6.07

 

Transactions with Affiliates

 

123

 

 

 

 

 

 

 

SECTION 6.08

 

Restrictive Agreements

 

123

 

 

 

 

 

 

 

SECTION 6.09

 

Amendment of Material Documents

 

124

 

 

 

 

 

 

 

SECTION 6.10

 

Minimum Availability

 

124

 

 

 

 

 

 

 

SECTION 6.11

 

Fiscal Year.

 

124

 

 

 

 

 

 

 

SECTION 6.12

 

ERISA.

 

124

iv

 


 

 

 

 

 

 

 

 

SECTION 6.13

 

Environmental Laws

 

125

 

 

 

 

 

 

 

SECTION 6.14

 

Additional Subsidiaries

 

125

 

 

 

 

 

 

ARTICLE VII Events of Default

 

126

 

 

 

 

SECTION 7.01

 

Events of Default

 

126

 

 

 

 

 

 

 

SECTION 7.02

 

Remedies on Default

 

130

 

 

 

 

 

 

 

SECTION 7.03

 

Application of Proceeds

 

131

 

 

 

 

 

 

 

SECTION 7.04

 

Application of Proceeds While FILO Loan or ABL Term Loan is outstanding.

 

132

 

 

 

 

 

 

 

SECTION 7.05

 

DIP Financing; Insolvency Proceedings.

 

133

 

 

 

 

 

 

ARTICLE VIII The Agents

 

136

 

 

 

 

SECTION 8.01

 

Appointment and Administration by Administrative Agent

 

136

 

 

 

 

 

 

 

SECTION 8.02

 

Appointment of Collateral Agent

 

136

 

 

 

 

 

 

 

SECTION 8.03

 

Sharing of Excess Payments

 

138

 

 

 

 

 

 

 

SECTION 8.04

 

Agreement of Applicable Lenders

 

138

 

 

 

 

 

 

 

SECTION 8.05

 

Liability of Agents

 

139

 

 

 

 

 

 

 

SECTION 8.06

 

Notice of Default

 

140

 

 

 

 

 

 

 

SECTION 8.07

 

Credit Decisions

 

140

 

 

 

 

 

 

 

SECTION 8.08

 

Reimbursement and Indemnification

 

141

 

 

 

 

 

 

 

SECTION 8.09

 

Rights of Agents

 

141

 

 

 

 

 

 

 

SECTION 8.10

 

Notice of Transfer

 

141

 

 

 

 

 

 

 

SECTION 8.11

 

Successor Agents

 

142

 

 

 

 

 

 

 

SECTION 8.12

 

Relation Among the Lenders

 

142

 

 

 

 

 

 

 

SECTION 8.13

 

Reports and Financial Statements

 

142

 

 

 

 

 

 

 

SECTION 8.14

 

Agency for Perfection

 

143

 

 

 

 

 

 

 

SECTION 8.15

 

Collateral and Guaranty Matters

 

143

 

 

 

 

 

 

 

SECTION 8.16

 

Intercreditor Agreement

 

145

 

 

 

 

 

 

 

SECTION 8.17

 

Co-Syndication Agents, Documentation Agent, and Arrangers

 

145

 

 

 

 

 

 

 

SECTION 8.18

 

Reserves.

 

145

 

 

 

 

 

 

 

SECTION 8.19

 

ABL Term Loan Agent.

 

146

 

 

 

 

 

 

ARTICLE IX Miscellaneous

 

148

 

 

 

v

 


 

 

SECTION 9.01

 

Notices.

 

148

 

 

 

 

 

 

 

SECTION 9.02

 

Waivers; Amendments.

 

148

 

 

 

 

 

 

 

SECTION 9.03

 

Expenses; Indemnity; Damage Waiver

 

155

 

 

 

 

 

 

 

SECTION 9.04

 

Successors and Assigns

 

157

 

 

 

 

 

 

 

SECTION 9.05

 

Survival.

 

160

 

 

 

 

 

 

 

SECTION 9.06

 

Counterparts; Integration; Effectiveness

 

161

 

 

 

 

 

 

 

SECTION 9.07

 

Severability.

 

161

 

 

 

 

 

 

 

SECTION 9.08

 

Right of Setoff

 

161

 

 

 

 

 

 

 

SECTION 9.09

 

Governing Law; Jurisdiction; Service of Process

 

162

 

 

 

 

 

 

 

SECTION 9.10

 

WAIVER OF JURY TRIAL

 

162

 

 

 

 

 

 

 

SECTION 9.11

 

Press Releases and Related Matters

 

163

 

 

 

 

 

 

 

SECTION 9.12

 

Headings.

 

163

 

 

 

 

 

 

 

SECTION 9.13

 

Interest Rate Limitation

 

163

 

 

 

 

 

 

 

SECTION 9.14

 

Additional Waivers

 

163

 

 

 

 

 

 

 

SECTION 9.15

 

Confidentiality

 

165

 

 

 

 

 

 

 

SECTION 9.16

 

Patriot Act

 

166

 

 

 

 

 

 

 

SECTION 9.17

 

Foreign Asset Control Regulations

 

166

 

 

 

 

 

 

 

SECTION 9.18

 

Judgment Currency.

 

167

 

 

 

 

 

 

 

SECTION 9.19

 

No Strict Construction.

 

167

 

 

 

 

 

 

 

SECTION 9.20

 

Payments Set Aside.

 

167

 

 

 

 

 

 

 

SECTION 9.21

 

No Advisory or Fiduciary Responsibility.

 

168

 

 

 

 

 

 

 

SECTION 9.22

 

Existing Credit Agreement Amended and Restated.

 

168

 

 

 

 

 

 

 

SECTION 9.23

 

Keepwell.

 

169

 

 

 

 

 

 

 

SECTION 9.24

 

ENTIRE AGREEMENT.

 

169

 

 

 

 

 

 

 

SECTION 9.25

 

Intercreditor Agreement.

 

169

 

 

 

 

 

 

 

SECTION 9.26

 

Conflicts.

 

169

 

 

 

 

 

 

 

SECTION 9.27

 

Acknowledgement and Consent to Bail-In of EEA Financial Institutions.

 

170

 


vi

 


 

EXHIBITS

 

Exhibit A:

Form of Assignment and Acceptance

Exhibit B:

Form of Customs Broker Agreement

Exhibit C:

Form of Notice of Borrowing

Exhibit D:

Form of Revolving Credit Note

Exhibit D-1:

Form of FILO Note

Exhibit D-2:

Form of ABL Term Note

Exhibit E:

Form of Swingline Note

Exhibit F:

Form of Credit Card Notification

Exhibit G:

Form of Compliance Certificate

Exhibit H:

Form of Borrowing Base Certificate

Exhibits I-1 through 1-4:

Form of U.S. Tax Compliance Certificates

 


vii

 


 

SCHEDULES

 

Schedule 1.1:

Lenders and Commitments

Schedule 1.2:

Facility Guarantors

Schedule 1.3:

Fiscal Months, Fiscal Quarters, Fiscal Years

Schedule 1.4:

Non-Material Domestic Subsidiaries

Schedule 5.01(f):

Reporting Requirements

 

 

viii

 


 

SECOND AMENDED AND RESTATED CREDIT AGREEMENT

This Second Amended and Restated Credit Agreement dated as of June 2, [2017]2017, as amended December 14, 2018, is entered into among:

PIER 1 IMPORTS (U.S.), INC., a Delaware corporation with its principal executive offices at 100 Pier 1 Place, Fort Worth, Texas 76102 (the “Borrower”);

THE FACILITY GUARANTORS identified on Schedule 1.2 hereof;

BANK OF AMERICA, N.A., a national banking association with offices at 100 Federal Street, Boston, Massachusetts 02110, as administrative agent (in such capacity, the “Administrative Agent”) and as collateral agent (in such capacity, the “Collateral Agent”) for its own benefit and the benefit of the other Credit Parties; [and]

PATHLIGHT CAPITAL FUND I LP, a Delaware limited partnership, as the ABL Term Loan Agent in such capacity, including any thereto the “ABL Term Loan Agent”);

The LENDERS party hereto;

WELLS FARGO BANK, NATIONAL ASSOCIATION and U.S. BANK NATIONAL ASSOCIATION, as Co-Syndication Agents; and

JPMORGAN CHASE BANK, N.A., as Documentation Agent.

WITNESSETH:

WHEREAS, the Borrower has entered into (x) that certain Credit Agreement, dated as of November 22, 2005 (the “Original Credit Agreement”), by, among others, (i) the Borrower, (ii) the “Lenders” as defined therein, and (iii) Bank of America, N.A. as “Administrative Agent” and “Collateral Agent”, and (y) that certain Amended and Restated Credit Agreement, dated as of April 4, 2011 (as amended and in effect, the “Existing Credit Agreement”), by, among others, (i) the Borrower, (ii) the “Lenders” as defined therein, and (iii) Bank of America, N.A. as “Administrative Agent” and “Collateral Agent”, which Existing Credit Agreement amended and restated the Original Credit Agreement in its entirety; and

WHEREAS, in accordance with Section 9.02 of the Existing Credit Agreement, the Borrower, the Lenders, and the Administrative Agent desire to amend and restate the Existing Credit Agreement as provided herein.

NOW, THEREFORE, in consideration of the mutual agreements set forth in this Agreement (as defined herein), and for good and valuable consideration, the receipt of which is hereby acknowledged, the undersigned hereby agree that the Existing Credit Agreement shall be amended and restated in its entirety to read as follows (it being agreed that this Agreement shall not be deemed to evidence or result in a novation or repayment and reborrowing of the Obligations under and as defined in either of the Original Credit Agreement or the Existing Credit Agreement):

1

 


 

ARTICLE I
Amount and Terms of Credit

SECTION 1.01Definitions.

As used in this Agreement, the following terms have the meanings specified below:

ABL Priority Collateral” has the meaning provided for such term in the Intercreditor Agreement.

“ABL Term Borrowing Base” means, at any time of calculation, an amount equal to:

(a)the face amount of Eligible Credit Card Receivables multiplied by the Credit Card Advance Rate for the ABL Term Borrowing Base;

plus

(b)the Appraised Inventory Value of Eligible Inventory (but excluding Eligible In-Transit Inventory and Eligible Letter of Credit Inventory), net of Inventory Reserves, multiplied by the Cost of Eligible Inventory (but excluding Eligible In-Transit Inventory and Eligible Letter of Credit Inventory) multiplied by the Inventory Appraisal Percentage for the ABL Term Borrowing Base;

plus

(c)the Appraised Inventory Value of Eligible In-Transit Inventory and Eligible Letter of Credit Inventory, net of Inventory Reserves, multiplied by the Cost of Eligible, In-Transit Inventory and Eligible Letter of Credit Inventory multiplied by the Appraisal Percentage for the ABL Term Borrowing Base;

provided that, for every $1,000,000 in aggregate principal amount of the ABL Term Loans prepaid or repaid by the Borrower, each of the Inventory Appraisal Percentage with respect to the ABL Term Borrowing Base shall by reduced based on a rate of 2.5 basis points for every $1,000,000 (e.g. if the amount of such repayment or prepayment was $1,000,000, and the relevant advance rate, prior to such prepayment was 10%, such advance rate will be reduced to 9.975%). Such reduction shall be effective on the next succeeding date following the date of the relevant prepayment on which a Borrowing Base Certificate is required to be delivered under Section 5.01(d).

“ABL Term Credit Party” means the ABL Term Loan Agent and the ABL Term, Lenders and their respective successors and permitted assigns.

“ABL Term Default Rate” has the meaning provided in SECTION 2.12(b).

“ABL Term Lender” means, at any time, each Person that makes an ABL Term, Loan to the Borrower in the amount set forth opposite such Lender’s name on Schedule 1.1 hereto or as may be subsequently set forth in the Register from time to time.

2

 


 

“ABL Term Loan” means the ABL term loan made by each of the ABL Term Lenders to the Borrower on the First Amendment Effective Date. The aggregate principal amount of the ABL Term Loan on the First Amendment Effective Date is $35,000,000.

“ABL Term Loan Agent” has the meaning provided in the preamble to this Agreement.

“ABL Term Loan Event of Default” means (i) an Event of Default under SECTION 7.01 (a) or (b) with, respect to the ABL Term Loan or any other ABL Term Obligations, (ii) an Event of Default under SECTION 7.01(a) or (b) with respect to the Obligations (other than the ABL Term Obligations) as a result of failure of the Borrower to pay all such Obligations then due and owing due on the Maturity Date or the Termination Date or (iii) an Event of Default under SECTION 7.01(d) or (e) (as applicable), but only to the extent such Event of Default arises from the Loan Parties’ failure to comply with the provisions of SECTION 5.01(d) (in each instance of (iii), within three (3) Business Days of the date that the Borrowing Base Certificate is required to be delivered pursuant to SECTION 5.01(d)), or SECTION 6.10. Each determination of whether an ABL Term Loan Event of Default has occurred and is continuing shall be made without giving effect to any waiver or modification of any such provision effected pursuant to the terms hereof without the consent of the ABL Term Loan Agent.

“ABL Term Loan Fee Letter” means the Fee Letter dated December 14, 2018 by and among the Borrower, the ABL Term Loan Agent and the other parties thereto, as amended, amended and restated, supplemented or replaced, and in effect from time to time.

“ABL Term Loan Percentage” shall mean with respect to each ABL Term Lender that percentage of the ABL Term Loans of all the ABL Term Lenders hereunder held by such ABL Term Lender, in the amount set forth opposite such Lender’s name on Schedule 1.1 hereto or as may be subsequently set forth in the Register from time to time, as the same may be increased or reduced from time to time pursuant to this Agreement.

“ABL Term Loan Prepayment Premium” shall have the meaning given to such term in the ABL Term Loan Fee Letter.

“ABL Term Loan Rate” means, the rate per annum (rounded upwards, if necessary, to the nearest 1/100th), determined on the first day of each calendar month, appearing on Reuters Screen LIBOR01 Page (or on any successor or substitute page of such service, or any successor to or substitute for such service as determined by the ABL Term Loan Agent) as the London interbank offered rate for deposits in Dollars for an interest period of three (3) months as of such date (but if more than one rate is specified on such page, the rate will be an arithmetic average of all such rates).

“ABL Term Loan Reserve” means an amount, at any time of calculation, equal to the excess of the then outstanding amount of the portion of the ABL Term Loan over the ABL Term Borrowing Base as, reflected in the most recent Borrowing Base Certificate furnished by the Borrower; provided, however, that if the ABL Term Loan Agent determine in good faith that there has been a mathematical error in calculating the ABL Term Loan Reserve, the ABL Term Loan Agent may notify the Administrative Agent (and shall notify the Borrower) thereof, setting forth the amount of the ABL Term Loan Reserve to be established as calculated by the ABL Loan Term

3

 


 

Agent and the basis for its determination, together with its detailed calculation. Within three (3) Business Days after receipt of such notice from the ABL Term Loan Agent the Administrative Agent shall establish an ABL Term Loan Reserve in the amount requested by the ABL Term Loan„ Agent (in the absence of manifest error). The Administrative Agent shall have no obligation to investigate the basis, for the ABL Term Loan Agent’s dispute or calculation, may conclusively rely on the notice furnished by the ABL Term Loan Agent with respect thereto, and shall have no liability to any Loan Party or Credit Party for following the instructions of the ABL Term Loan Agent. If any time the circumstances giving rise to any imposition of the ABL Term Loan Reserve have ceased to exist then immediately following receipt of a Borrowing Base Certificate in accordance with the terms hereof reflecting that no ABL Term Loan Reserve is then applicable, the Administrative Agent shall remove such ABL Term Loan Reserve without need for further instruction from the ABL Term Loan Agent; it being understood that the Administrative Agent shall be entitled to verify with the ABL Term Loan Agent that such circumstances have ceased to exist (and the ABL Term Loan Agent shall within one (1) Business Day) respond to any such request from the Administrative Agent.

“ABL Term Loan Standstill Period” means, with respect to an ABL Term Loan Event of Default, the period commencing on the date of the Administrative Agent’s and the Borrower’s receipt of written notice from the ABL Term Loan Agent that an ABL Term Event of Default has occurred and is continuing, and that the ABL Term Agent is requesting the Agents to commence the enforcement of remedies, and ending on the date which is sixty (60) days after receipt of such notice with respect to any ABL Term Loan Event of Default.

“ABL Term Notes” means the promissory notes of the Borrower substantially in the form of Exhibit D-2, each payable to an ABL Term Lender, evidencing ABL Term Loans made to the Borrower.

“ABL Term Obligations” mean (a) the due and punctual payment of (i) the principal of, and interest (including all interest that accrues after the commencement of any case or proceeding by or against any Loan Party under the Bankruptcy Code, the BIA, the WURA or the CCAA or any state, federal or provincial bankruptcy, insolvency, receivership, or similar law, whether or not allowed in such case or proceeding) on the ABL Term Loans, as and when due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, and (ii) all other monetary obligations, including fees (including, without limitation, the ABL Term Loan Prepayment Premium, if applicable), costs, expense and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise, of the Loan Parties to the ABL Term Secured Parties under this Agreement and the other Loan Documents, including, without limitation, for all such items that accrue after the commencement of any case or proceeding by or against any Loan Party under the Bankruptcy Code, the BIA, the WURA or the CCAA or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case, or proceeding, and (b) the due and punctual payment and performance of all the covenants, agreements, obligations and liabilities of each Loan Party under or pursuant to this Agreement and the other Loan Documents related to the ABL Term Loans.

“ABL Term Secured Party” means (a) each ABL Term Credit Party and (b) the successors and subject to any limitations contained in this Agreement assigns of each of the foregoing.

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ACH means automated clearing house transfers.

Accommodation Payment” has the meaning provided in SECTION 9.14.

Account(s)” means “accounts” and “payment intangibles” as defined in the UCC, and the PPSA, as applicable, but limited to a right to payment of a monetary obligation, whether or not earned by performance, (i) for Inventory that has been or is to be sold, leased, licensed, assigned, or otherwise disposed of, (ii) for services rendered or to be rendered in connection with the sale, lease, license, assignment or other disposition of Inventory, or (iii) arising out of the use of a credit or charge card or information contained on or for use with the card in connection with the sale, lease, license, assignment or other disposition of Inventory. The term “Account” does not include (i) rights to payment evidenced by chattel paper or an instrument, (ii) commercial tort claims, (iii) deposit accounts, (iv) investment property, (v) letter-of-credit rights or letters of credit, or (vi) rights to payment for money or funds advanced or sold, other than rights arising out of the use of a credit or charge card or information contained on or for use with the card.

Acquisition” means, with respect to a specified Person, (a) an Investment in, or a purchase of, a fifty percent (50%) or greater interest in the Capital Stock of any other Person, (b) a purchase or acquisition of all or substantially all of the assets or any line or division of any other Person, or (c) any merger, amalgamation or consolidation of such Person with any other Person, in each case in any transaction or group of transactions which are part of a common plan.

Additional Commitment Lender” shall have the meaning provided therefor in SECTION 2.02(b).

Adjusted LIBO Rate” means, with respect to any LIBO Borrowing for any Interest Period, an interest rate per annum (rounded [upwards, if necessary,]up to the [next 1/16 of one percent]nearest 1/16th of 1% and in no event less than zero) equal to ([a])i the LIBO Rate for such Interest Period multiplied by ([b]ii) the Statutory Reserve Rate. The Adjusted LIBO Rate will be adjusted automatically as to all LIBO Borrowings then outstanding as of the effective date of any change in the Statutory Reserve Rate.

Administrative Agent” has the meaning provided in the preamble to this Agreement.

Affiliate” means, with respect to a specified Person, any other Person that directly or indirectly through one or more intermediaries Controls, is Controlled by or is under common Control with the Person specified.

Agents” means collectively, the Administrative Agent and the Collateral Agent.

Aggregate Store Closing Percentage” means, as of any date of determination, a percentage calculated by dividing (i) the difference, if a positive number, between the aggregate number of the Borrower’s stores closed since the Effective Date and the number of stores opened by the Borrower since the Effective Date, by (ii) the number of the Borrower’s stores in operation as of the Effective Date.

Agreement” means this Second Amended and Restated Credit Agreement, as modified, amended, amended and restated, supplemented or restated, and in effect from time to time.

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Agreement Value means, for each Financial Hedge, on any date of determination, an amount determined by the applicable Person described below equal to:

(a)In the case of a Financial Hedge documented pursuant to an ISDA master agreement, the net amount, if any, that would be payable by any Loan Party to its counterparty to such Financial Hedge, as if (i) such Financial Hedge was being terminated early on such date of determination, (ii) such Loan Party was the sole “Affected Party” (as therein defined) and (iii) such Person providing such Financial Hedge was the sole party determining such payment amount (with such Person making such determination pursuant to the provisions of the form of ISDA master agreement);

(b)In the case of a Financial Hedge traded on an exchange, the mark-to-market value of such Financial Hedge, which will be the net unrealized loss on such Financial Hedge to the Loan Party which is party to such Financial Hedge, determined by the Administrative Agent based on the settlement price of such Financial Hedge on such date of determination; or

(c)In all other cases, the mark-to-market value of such Financial Hedge, which will be the unrealized loss on such Financial Hedge to the Loan Party that is party to such Financial Hedge determined by the Administrative Agent as the amount, if any, by which (i) the present value of the future cash flows to be paid by such Loan Party exceeds (ii) the present value of the future cash flows to be received by such Loan Party, in each case pursuant to such Financial Hedge.

Annual Store Closing Percentage” means, as of any date of determination for any Fiscal Year, a percentage calculated by dividing (i) the difference, if a positive number, between the number of the Borrower’s stores closed in such Fiscal Year and the number of stores opened by the Borrower in such Fiscal Year, by (ii) the number of the Borrower’s stores in operation as of the beginning of such Fiscal Year.

Applicable Law” means as to any Person: (a) all laws, statutes, rules, regulations, orders, codes, ordinances or other requirements having the force of law; and (b) all court orders, decrees, judgments, injunctions, notices, binding agreements and/or rulings, in each case of or by any Governmental Authority which has jurisdiction over such Person, or any property of such Person.

Applicable Lenders” means the Required Lenders or all Lenders, as applicable

Applicable Margin” means:

(a)From and after the First Amendment Effective Date until the [date that is three months]first Adjustment Date following the First Amendment Effective Date[ (as though such date were an “Adjustment Date”, as defined below)], the percentages set forth in Level [I]II of the Pricing Grid below; and

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(b)On[ the date that is three months following the Effective Date, and thereafter on] the first day of each January, April, July and October of each year (each, an Adjustment Date”), the Applicable Margin shall be determined from such Pricing Grid based upon Average Daily Availability for the most recently ended three month period immediately preceding such Adjustment Date; provided that upon the occurrence of an Event of Default, the Administrative Agent may, and at the direction of the Required Revolving Lenders shall, immediately increase the Applicable Margin to that set forth in Level I (even if the Average Daily Availability requirements for Level II have been met, without limiting the right of the Administrative Agent or the Required Revolving Lenders to charge interest at the Default Rate as provided in SECTION 2.12(a)); provided further if the Borrowing Base Certificates are at any time restated or otherwise revised (including as a result of an audit) or if the information set forth in any Borrowing Base Certificates otherwise proves to be false or incorrect such that the Applicable Margin would have been higher than was otherwise in effect during any period, without constituting a waiver of any Default or Event of Default arising as a result thereof, interest due under this Agreement shall be immediately recalculated at such higher rate for any applicable periods and shall be due and payable on demand.

Level

Average Daily Availability

LIBO Applicable Margin for Revolving Credit Loans

Prime Rate Applicable Margin for Revolving Credit Loans

LIBO
Applicable
Margin for
FILO Loan

Prime Rate
Applicable
Margin for
FILO Loan

I

Less than or equal to 50% of the line Cap

1.50%

0.50%

3.00%

0.50%

II

Greater than or equal to 50% of the line Cap

1.25%

0.25%

3.00%

0.25%

 

Appraised Inventory Value” means the net appraised liquidation value (which is expressed as a percentage of Cost) of the Borrower’s Eligible Inventory as set forth in the Borrower’s inventory stock ledger as determined from time to time by an independent appraiser reasonably satisfactory to the Administrative Agent.

Appraisal Percentage” means (i) with respect to the Borrowing Base, ninety percent (90%), (ii) with respect to the FILO Borrowing Base five percent 5% and (iii) with respect to the ABL Term Borrowing Base, ten percent (10%).

Arrangers” means Merrill Lynch, Pierce, Fenner & Smith Incorporated and Wells Fargo Bank, National Association.

Arranger” means either one of the foregoing.

Assignment and Acceptance” means an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by SECTION 9.04), and accepted by the Administrative Agent, in the form of Exhibit A or any other form approved by the Administrative Agent.

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Availability means[ the lesser of (a) or (b), where: ][(a) is], as of any date of determination thereof, the result, if a positive number, of:

([i)

The Revolving Credit Ceiling,]a)the Line Cap as of such date:

Minus

[(ii)

The Total Outstandings;]

(b)

[is the result of:]the aggregate amount of all outstanding Credit Extensions.

[(i)

The Borrowing Base,]

[Minus]

[(ii)

The Total Outstandings.]

In calculating Availability at any time and for any purpose under this Agreement, the Borrower shall certify to the Administrative Agent that no accounts payable are being intentionally paid after their due date other than any such accounts payable (x) the validity or amount of which are being contested in good faith by appropriate proceedings, and (y) for which the Borrower has set aside on its books adequate reserves with respect thereto in accordance with GAAP.

Availability Reserves” means, without duplication of any other Reserves or items that are otherwise addressed or excluded through eligibility criteria, such reserves as the Administrative Agent, from time to time determines in its reasonable commercial discretion exercised in good faith as being appropriate (a) to reflect the impediments to the Agents’ ability to realize upon the ABL Priority Collateral, (b) to reflect costs, expenses and other amounts that the Agents may incur or be required to pay to realize upon the ABL Priority Collateral, including, without limitation, on account of rent, Permitted Encumbrances, and customs and duties, and other costs to release Inventory which is being imported into the United States or Canada, (c) to reflect criteria, events, conditions, contingencies or risks which adversely affect any component of the Borrowing Base, the FILO Borrowing Base or the ABL Term Borrowing Base, (d) to reflect that an Event of Default then exists and (e) on account of Cash Management Services and Bank Products (including, as directed by the ABL Term Loan Agent in accordance with SECTION 8.18). Without limiting the generality of the foregoing, Availability Reserves may include (but are not limited to) reserves based on: (a) outstanding taxes and other governmental charges, including, without limitation, ad valorem, personal property, sales, goods and services, harmonized, and other taxes which might have priority over the interests of the Collateral Agent in the ABL Priority Collateral; (b) amounts deducted or withheld, or may be subject to withholding, and not paid and remitted when due under the Income Tax Act (Canada); (c) Wage Earner Protection Act Reserve; (d) salaries, wages and benefits due to employees of any Loan Party, including, without limitation, reserves for amounts due and not paid for vacation pay, for amounts due and not paid under any legislation relating to workers’ compensation or employment insurance, and for all amounts past due and not contributed, remitted or paid to any Plan, or any similar legislation, (e) Customer Credit Liabilities, (f) warehousemen’s or bailees’ charges which might have priority over the interests of the Collateral Agent in the ABL Priority Collateral, (g) amounts due to vendors on account of consigned goods, (h) reserves for reasonably anticipated changes in the Appraised Inventory Value between appraisals and (i) the Debt Maturity Reserve.

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Average Daily Availability shall mean, for any date of calculation, the average daily Availability, determined as of the close of business each day, for the subject period.

Bail-In Action” means the exercise of any Write-Down and Conversion Powers by the applicable EEA Resolution Authority in respect of any liability of an EEA Financial Institution.

Bail-In Legislation” means, with respect to any EEA Member Country implementing Article 55 of Directive 2014/59/EU of the European Parliament and of the Council of the European Union, the implementing law for such EEA Member Country from time to time which is described in the EU Bail-In Legislation Schedule.

Bank of America” means, Bank of America, N.A., a national banking association, and its Subsidiaries and Affiliates.

Bank of America Concentration Account” means a DDA established by the Borrower with Bank of America and with respect to which the Collateral Agent has control (as defined in the UCC) pursuant to a Blocked Account Agreement.

Bank Products” means any services (other than Cash Management Services) or facilities provided to any Loan Party by any Person to the extent such Person was the Administrative Agent, a Revolving Lender or an Affiliate of the Administrative Agent or a Revolving Lender at the time such services or facilities were so provided, such services or facilities including, without limitation, on account of (a) credit or debit cards, (b) Financial Hedges, (c) purchase cards, and (d) supply chain finance services (including, without limitation, trade payable services, e-payables services and supplier accounts receivable purchases).

Banker’s Acceptance” means a time draft or bill of exchange (in each case, payable not more than ninety (90) days duration from acceptance) relating to a Commercial Letter of Credit which has been accepted by an Issuing Bank.

Bankruptcy Code” means Title 11, U.S.C., as now or hereafter in effect, or any successor thereto.

BIA” means The Bankruptcy and Insolvency Act (Canada), and any regulations promulgated thereunder, if any, as amended from time to time.

Blocked Account” has the meaning provided in SECTION 2.18(a)(ii).

Blocked Account Agreement” means with respect to an account established by a Loan Party, an agreement, in form and substance reasonably satisfactory to the Collateral Agent, establishing control (as defined in the UCC) of such account by the Collateral Agent and whereby the bank maintaining such account agrees, upon the occurrence and during the continuance of a Cash Dominion Event and to the extent that any Obligations (other than any contingent indemnification Obligations for which no claim has then been asserted) are then outstanding, to comply only with the instructions originated by the Collateral Agent without the further consent of any Loan Party.

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Blocked Account Banks means the banks with whom deposit accounts are maintained in which material amounts (as reasonably determined by the Administrative Agent) of funds of any of the Loan Parties from one or more DDAs are concentrated (including, without limitation, Wells Fargo Bank, National Association, or any other Lender), and with whom a Blocked Account Agreement has been, or is required to be, executed in accordance with the terms hereof.

Board” means the Board of Governors of the Federal Reserve System of the United States of America.

Borrower” means Pier 1 Imports (U.S.), Inc.

Borrowing” means (a) the incurrence of Revolving Credit Loans of a single Type, on a single date and having, in the case of LIBO Loans, a single Interest Period, or (b) a Swingline Loan. a Revolving Borrowing, (b) the borrowing of the FILO Loan on the First Amendment Effective Date, or (b) the borrowing of the ABL Term Loan on the First Amendment Effective Date.

Borrowing Base” means, at any time of calculation, an amount equal to:

(a)the face amount of Eligible Credit Card Receivables multiplied by the Credit Card Advance Rate for the Borrowing Base;

plus

(b)the Appraised Inventory Value of Eligible Inventory (but excluding Eligible In-Transit Inventory and Eligible Letter of Credit Inventory), net of Inventory Reserves, multiplied by the Cost of Eligible Inventory (but excluding Eligible In-Transit Inventory and Eligible Letter of Credit Inventory) multiplied by the Inventory Appraisal Percentage for the Borrowing Base;

plus

(c)the Appraised Inventory Value of Eligible In-Transit Inventory and Eligible Letter of Credit Inventory, net of Inventory Reserves, multiplied by the Cost of Eligible In-Transit Inventory and Eligible Letter of Credit Inventory multiplied by the Appraisal Percentage for the Borrowing Base;

minus

(d)the Term Loan Maturity Reserve,

minus

(e)the FILO Reserve, any minus

minus

(f)the ABL Term Loan Reserve, if any,

minus

(g)the then amount of all Availability Reserves.

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Borrowing Base Certificate has the meaning provided in SECTION 5.01(d).

Borrowing Request” means a request by the Borrower for a Borrowing in accordance with SECTION 2.04.

Breakage Costs” has the meaning provided in SECTION 2.16(b).

Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in Boston, Massachusetts or Charlotte, North Carolina are authorized or required by law to remain closed; provided, however, that when used in connection with a LIBO Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.

Capital Expenditures” means, with respect to any Person for any period, (a) the additions to property, plant and equipment and other capital expenditures of the Loan Parties that are (or would be) set forth in a Consolidated statement of cash flows of the Loan Parties for such period prepared in accordance with GAAP and (b) any assets acquired by a Capital Lease Obligation during such period; provided that the term “Capital Expenditures” shall not include the following (to the extent that the following would otherwise be included and without duplication): (i) the purchase price for Permitted Acquisitions, (ii) any such expenditures to the extent any Loan Party or any of its Subsidiaries has received reimbursement in cash from a third party during such period other than from any other Loan Party or any Subsidiary of a Loan Party, in an amount not exceeding such reimbursement to the extent not required to be repaid, directly or indirectly, to such third party, (iii) the purchase price of equipment or Real Estate used in the business of the Loan Parties and their Subsidiaries in the ordinary course and purchased during such period to the extent the consideration therefor consists of any combination of (A) used or surplus equipment used in the business in the ordinary course and traded in at the time of such purchase, and (B) the proceeds of a concurrent sale of used or surplus equipment used in the business in the ordinary course, in each case, traded or sold in the ordinary course of business, (iv) capitalized interest of the Loan Parties and their Subsidiaries, (v) any expenditure financed with the proceeds of Indebtedness specifically designated for such purpose and which are so utilized within ninety (90) days after the receipt of such proceeds, (vi) any expenditure financed with the proceeds of Capital Stock specifically designated for such purpose and which are so utilized within one hundred eighty (180) days after the receipt of such proceeds, (vii) any expenditure to repair or replace any property which is financed with the proceeds from any casualty insurance or condemnation or eminent domain, to the extent that the proceeds therefrom are so utilized within one hundred eighty (180) days of the receipt of such proceeds, and (viii) any Capital Expenditures to the extent financed as Capital Lease Obligations.

Capital Lease Obligations” means, with respect to any Person for any period, the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP; provided that the adoption or issuance of any accounting standards after the Effective Date will not cause any lease (or any extensions or renewals of the same) that was not or would not have been classified or accounted for as a capital lease on a balance sheet of such Person prior to the adoption or issuance to be deemed a capital lease.

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Capital Stock means, as to any Person that is a corporation, the authorized shares of such Person’s capital stock, including all classes of common, preferred, voting and nonvoting capital stock, and, as to any Person that is not a corporation or an individual, the membership or other ownership interests in such Person, including, without limitation, the right to share in profits and losses, the right to receive distributions of cash and other property, and the right to receive allocations of items of income, gain, loss, deduction and credit and similar items from such Person, whether or not such interests include voting or similar rights entitling the holder thereof to exercise control over such Person, collectively with, in any such case, all warrants, options and other rights to purchase or otherwise acquire, and all other instruments convertible into or exchangeable for, any of the foregoing; provided that in no event shall any Indebtedness (or instrument representing any Indebtedness) that is convertible into or exchangeable for any of the foregoing constitute “Capital Stock” (unless and until so converted or exchanged) or otherwise be considered a right to acquire “Capital Stock” for any purpose of this Agreement.

Cash Collateral Account” means an interest bearing account established by the Loan Parties with the Collateral Agent, for its own benefit and the ratable benefit of the other Credit Parties, under the sole and exclusive dominion and control of the Collateral Agent, in the name of the Collateral Agent or as the Collateral Agent shall otherwise direct, in which deposits are required to be made in accordance with SECTION 2.13(k).

Cash Dominion Event” means either (i) the occurrence and continuance of any Specified Default, or (ii) Availability is less than the greater of (A) twelve and one-half percent (12.5%) of the Line Cap (without giving effect to the Specified Reserves), or (B) $[25,000,000.]30,000,000. For purposes of this Agreement, the occurrence of a Cash Dominion Event shall be deemed continuing, notwithstanding whether the circumstance which gave rise to such event is no longer continuing (a) so long as such Specified Default has not been waived, and/or (b) if the Cash Dominion Event arises as a result of the Borrower’s Availability being less than the required amount set forth in clause (ii) above, until Availability has exceeded the greater of (A) twelve and one-half percent (12.5%) of the Line Cap (without giving effect to the Specified Reserves), or (B) $[25,000,000,]30,000,000, for forty-five (45) consecutive days, in which case a Cash Dominion Event shall no longer be deemed to be continuing for purposes of this Agreement, provided, that a Cash Dominion Event may not be so cured (even if a Specified Default is no longer continuing and/or Availability exceeds the required amount for forty-five (45) consecutive days) on more than three (3) occasions in any period of 365 consecutive days. The termination of a Cash Dominion Event as provided herein shall in no way limit, waive or delay the occurrence of a subsequent Cash Dominion Event in the event that the conditions set forth in this definition again arise.

Cash Management Services” means [(i) any]the following cash management services provided to any Loan Party by any Person to the extent such Person was the Administrative Agent, a Revolving Lender or an Affiliate of the Administrative Agent or a Revolving Lender at the time such services were so provided, such cash management services including, without limitation, (a) ACH transactions, (b) treasury and/or cash management services, including, without limitation, controlled disbursement services, treasury, depository, overdraft, and electronic funds transfer services, and (c) credit card processing services and other merchant services (other than those constituting a line of credit).

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Cash Receipts has the meaning provided therefor in SECTION 2.18(b).

CCAA” means The Companies’ Creditors Arrangement Act (Canada), and any regulations promulgated thereunder, if any, as amended from time to time.

CERCLA” means the Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C. § 9601 et seq.

Change in Control” means, at any time:

(a)any “change in/of control” or similar event as defined in any document governing Material Indebtedness of any Loan Party the occurrence of which would permit the holder of such Material Indebtedness or any trustee or agent on its behalf to cause such Indebtedness to become due, or to require the prepayment, repurchase, redemption or defeasance of such Indebtedness, prior to its scheduled maturity; or

(b)[reserved]; or

(c)any person or “group” (within the meaning of the Securities and Exchange Act of 1934, as amended), is or becomes the beneficial owner (within the meaning of Rule 13d-3 or 13d-5 of the Securities and Exchange Act of 1934, as amended) directly or indirectly of thirty-five percent (35%) or more (on a fully diluted basis) of the total then outstanding voting Capital Stock of the Parent, whether as a result of the issuance of securities of the Parent, a merger, amalgamation, consolidation, liquidation or dissolution of the Parent, a direct or indirect transfers of securities or otherwise; or

(d)other than as a result of a transaction expressly permitted pursuant to SECTION 6.04 or SECTION 6.05, the Parent fails at any time to own, directly or indirectly, one hundred percent (100%) of the Capital Stock of each Loan Party free and clear of all Liens (other than (i) the Liens in favor of the Collateral Agent for its own benefit and the ratable benefit of the other Credit Parties, and (ii) Liens securing the Loan Parties’ obligations under the Term Loan Documents and Liens permitted under clause (z) of the definition of “Permitted Encumbrances”, in each case subject to the Intercreditor Agreement and any other intercreditor agreements with respect thereto).

Change in Law” means (a) the adoption or taking effect of any law, rule, regulation or treaty after the Effective Date, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or application thereof by any Governmental Authority after the Effective Date, or (c) compliance by any Credit Party (or, for purposes of SECTION 2.14, by any lending office of such Credit Party or by such Credit Party’s holding company, if any) with any request, rule, guideline or directive (whether or not having the force of law) of any Governmental Authority made or issued after the Effective Date; provided that notwithstanding anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

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Charges has the meaning provided therefor in SECTION 9.13.

Charter Document” means as to any Person, its partnership agreement, certificate or articles of incorporation, or amalgamation or amendment, operating agreement, membership agreement or similar constitutive document or agreement or its by-laws.

Documentation Agent” has the meaning provided in the preamble to this Agreement

Co-Syndication Agents” has the meaning provided in the preamble to this Agreement.

Code” means the Internal Revenue Code of 1986 and the Treasury regulations promulgated thereunder, as amended from time to time.

Collateral” means any and all “Collateral” or words of similar intent as defined in any applicable Security Document.

Collateral Access Agreement” means an agreement reasonably satisfactory in form and substance to the Agents and executed by (a) a bailee or other Person in possession of ABL Priority Collateral, and (b) any landlord of Real Estate leased by any Loan Party, pursuant to which such Person (i) acknowledges the Collateral Agent’s Lien on the ABL Priority Collateral, (ii) releases or subordinates such Person’s Liens in the ABL Priority Collateral held by such Person or located on such Real Estate, (iii) provides the Collateral Agent with access to the ABL Priority Collateral held by such bailee or other Person or located in or on such Real Estate, (iv) as to any landlord, provides the Collateral Agent with a reasonable time to sell and dispose of the ABL Priority Collateral from such Real Estate, and (v) makes such other agreements with the Agents as the Agents may reasonably require.

Collateral Agent” has the meaning provided in the preamble to this Agreement.

Commercial Letter of Credit” means any Letter of Credit issued for the purpose of providing the primary payment mechanism in connection with the purchase of any materials, goods or services by the Borrower in the ordinary course of business of the Borrower.

[Committed Increase has the meaning specified in SECTION 2.02(a).]

[Committed Increase Commitment means, with respect to each Commitment Increase Lender, the-aggregate-commitment of such Commitment Increase Lender hereunder in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be reduced from time to time pursuant to this Agreement.]

[Commitment Increase Lender means the Persons identified on Schedule 1.1 hereto which hold Committed Insurance Commitments and each assignee that becomes a party to this Agreement as set forth in SECTION 9.04(b).]

Commitment” means, with respect to each Lender, the aggregate commitment(s) of such Lender hereunder in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased or reduced from time to time pursuant to this Agreement[ and shall include, as applicable, any Committed Increase Commitment of such Lender].

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Commitment Increase shall have the meaning provided therefor in SECTION 2.02(b).

Commitment Increase Date” shall have the meaning provided therefor in SECTION 2.02(c).

[Commitment Percentage means, with respect to each Lender, that percentage of the Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased or reduced from time to time pursuant to this Agreement.]

Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.)

Compliance Certificate” has the meaning provided in SECTION 5.01(c).

Confirmation Agreement” means that certain Confirmation, Ratification and Amendment of Ancillary Loan Documents among the Loan Parties and the Agents, dated as of the Effective Date.

“Conforming DIP” has the meaning provided in SECTION 7.05(a)(i).

Consolidated” means, when used to modify a financial term, test, statement, or report of a Person, the application or preparation of such term, test, statement or report (as applicable) based upon the consolidation, in accordance with GAAP, of the financial condition or operating results of such Person.

Consolidated EBITDA” means, with respect to any Person for a twelve (12) Fiscal Month period, the sum (without duplication) of:

(a)Consolidated Net Income for such period; plus

(b)the sum (without duplication) of:

(i)depreciation and amortization for such period; plus

(ii)provisions for Taxes that were deducted in determining Consolidated Net Income for such period; plus

(iii)Consolidated Interest Expense that was deducted in determining Consolidated Net Income for such period; plus

(iv)any other non-cash charges, including any write offs or write downs, reducing Consolidated Net Income for such period (provided that any such non-cash charges shall be treated as cash charges in any future period in which the cash disbursement attributable thereto are made and such cash disbursement in such future period shall be subtracted from Consolidated EBITDA in such future period, and excluding amortization of a prepaid cash item that was paid in a prior period to the extent such cash item was deducted in calculating Consolidated EBITDA in period when paid); plus

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(v)impairment of goodwill for such period; plus

(vi)non-cash compensation expense, or other non-cash expenses or charges, arising from the granting of stock options, stock awards or similar arrangements (including profits interests), the granting of stock appreciation rights and similar arrangements (including any repricing, amendment, modification, substitution or change of any such stock option, stock appreciation rights, profits interests or similar arrangements), in each case for such period; plus

(vii)cash fees and expenses in connection with the transactions contemplated to occur on the Effective Date incurred on or prior to the date that is three (3) months following the Effective Date, in each case for such period; plus

(viii)any financial advisory fees, accounting fees, legal fees and other similar advisory and consulting fees and related out-of-pocket expenses of such Person and its Subsidiaries related to any offering of Capital Stock, Investment or acquisition permitted under this Agreement for such period; provided that in the case of any such offering of Capital Stock, such fees and related out-of-pocket expenses are paid with proceeds of any such offering of Capital Stock; provided further that the amounts described in this clause (viii) shall not exceed $10,000,000 in the aggregate if such offering is not successful or such Investment or acquisition is not consummated, as applicable; plus

(ix)the amount of any expenses with respect to liability or casualty events, business interruption or product recalls, to the extent covered by insurance proceeds actually received in cash during such period (it being understood that if the amount received in cash under any such agreement in any period exceeds the amount of expense paid during such period such excess amounts received may be carried forward and applied against expenses in future periods); minus

(c)extraordinary gains for such period.

Mark-to-market non-cash gains or losses in respect of obligations under the Financial Hedges as determined in accordance with GAAP shall be disregarded for the purpose of calculating Consolidated EBITDA.

Consolidated Fixed Charge Coverage Ratio” means, with respect to any Person for a twelve (12) Fiscal Month period, the ratio of (a) (i) Consolidated EBITDA for such period, plus (ii) Consolidated Rent Expense during such period, minus (iii) Capital Expenditures made during such period, minus (iv) cash Taxes that were deducted in determining Consolidated Net Income or other Taxes of the same type that were otherwise paid during such period (but in no event less than zero), to (b) (i) Debt Service Charges during such period, plus (ii) Restricted Payments made during such period, all as determined on a Consolidated basis.

Consolidated Interest Expense” means, with respect to any Person for a twelve (12) Fiscal Month period, total interest expense (including that attributable to Capital Lease Obligations in accordance with GAAP) of such Person on a Consolidated basis with respect to all outstanding Indebtedness of such Person, including, without limitation, the Obligations and all commissions, discounts and other fees and charges owed with respect thereto, all as determined on a Consolidated basis in accordance with GAAP.

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Consolidated Net Income means, with respect to any Person for a twelve (12) Fiscal Month period, the net income (or loss) of such Person on a Consolidated basis for such period taken as a single accounting period determined in accordance with GAAP; provided, however, that there shall be excluded (i) the income (or loss) of such Person (other than any Loan Party) in which any other Person has a joint interest, except to the extent of the amount of dividends or other distributions actually paid to such Person during such period, (ii) the income (or loss) of such Person accrued prior to the date it becomes a Subsidiary of a Person or any of such Person’s Subsidiaries or is merged into or consolidated with a Person or any of its Subsidiaries or that Person’s assets are acquired by such Person or any of its Subsidiaries, and (iii) the income of any direct or indirect Subsidiary of a Person (other than any Loan Party) to the extent that and for the portion of the period during which the declaration or payment of dividends or similar distributions by that Subsidiary of that income is not at the time permitted by operation of the terms of its Charter Documents or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary.

Consolidated Rent Expense” means, with respect to any Person for a twelve (12) Fiscal Month period, all obligations of such Person in respect of base, percentage and other rent expensed during such period under any rental agreements that cannot be cancelled upon thirty (30) days or less notice or leases of real property with third parties (other than Capital Lease Obligations), all as determined on a Consolidated basis in accordance with GAAP.

Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. The terms “Controlling” and “Controlled” have meanings correlative thereto.

Cost” means the cost of purchases, as reported on the Borrower’s stock ledger based upon the Borrower’s accounting practices, in effect on the Effective Date.

Covenant Conditions” means with respect to a Restricted Payment, a Permitted Acquisition, a prepayment of Indebtedness or an Investment as to which such term applies, that (i) no Default or Event of Default has occurred or shall occur after giving effect to such specified event, and (ii) such specified event is funded from cash on hand and not from proceeds of any Credit Extensions.

Credit Card Advance Rate” means (i) with respect to the Borrowing Base, ninety percent (90%), (ii) with respect to the FILO Borrowing Base, five percent (5%) and, (iii) with respect to the ABL Term Borrowing Base, ten percent (10%).

Credit Card Notification” has the meaning provided in SECTION 2.18(a)(i).

Credit Extensions” means each of the following: (a) a [Borrowing and (b) an L/C]Revolving Credit Extension, (b) the Borrowing of the FILO Loan on the First Amendment Effective Date, and (c) the Borrowing of the ABL Term Loan on the First Amendment Effective Date.

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Credit Party means (a) the Lenders, (b) the Agents, the ABL Term Loan Agent, and their Affiliates, (c) the Issuing Banks, (d) the Arrangers, (e) the beneficiaries of each indemnification obligation undertaken by any Loan Party under any Loan Document, (f) the Persons providing Cash Management Services or Bank Products to any Loan Party, (g) the Persons to whom Obligations are owing, and (h) the successors and permitted assigns of each of the foregoing.

Credit Party Expenses” means, without limitation, to the extent incurred in connection with this Agreement and the other Loan Documents: (i) all reasonable and documented out-of-pocket expenses incurred by the Agents and their Affiliates, including the reasonable and documented fees and out-of-pocket charges and disbursements of counsel for the Agents and outside consultants for the Agents (including, without limitation, inventory appraisers and commercial finance examiners but limited, in the case of legal fees, to the reasonable and documented fees, disbursements and other charges of one domestic counsel and one Canadian counsel to the Agents and their Affiliates, and of other local counsel in each relevant jurisdiction retained by the Agents or their Affiliates (to the extent such retention is deemed necessary by the Agents or their Affiliates)), in connection with the syndication of the credit facilities provided for herein, the preparation and administration of the Loan Documents or any amendments, modifications or waivers of the provisions thereof (whether or not any such amendments, modification or waivers shall be consummated), [(ii) all reasonable out-of-pocket expenses incurred by the ABL Term Loan Agent but limited in the case of legal expenses, and fees, to the reasonable and documented fees and out-of-pocket charges and disbursements of one domestic counsel and one Canadian counsel to the ABL Term Loan Agent and its Affiliates and of other local counsel in each relevant jurisdiction retained by the ABL Term Loan Agent and its Affiliates (to the extent such retention is deemed necessary by the ABL Term Loan Agent and its Affiliates), in connection with the preparation and negotiation, execution and delivery of the First Amendment and the other Loan Documents or any amendments, modifications or waivers requested by a Loan Party of the provisions hereof or thereof (whether or not any such amendments, modifications or waivers shall by consummated), (iii) all reasonable and documented out-of-pocket expenses incurred by the Issuing Banks in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder[ and]. ([iii]iv) all reasonable and documented out‑of-pocket expenses incurred by each of the Agents, including the reasonable and documented fees and out-of-pocket charges and disbursements of counsel and outside consultants for each of the Agents (including, without limitation, inventory and commercial finance examiners but limited, in the case of legal fees, to the reasonable and documented fees, disbursements and other charges of one domestic counsel and one Canadian counsel to the Agents and their Affiliates, and of other local counsel in each relevant jurisdiction retained by the Agents or their Affiliates (to the extent such retention is deemed necessary by the Agents or their Affiliates), in connection with the enforcement or protection of their rights in connection with the Loan Documents, or in connection with the Loans made or Letters of Credit issued hereunder, including all such out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit, and ([iv]v) all reasonable and documented out-of-pocket expenses incurred by any Lender, other than the ABL Term Lenders, including the reasonable and documented fees and out-of-pocket charges and disbursements of counsel and outside consultants for the Lenders in connection with the enforcement or protection of their rights in connection with the Obligations and the Loan Documents after the occurrence and during the continuance of an Event of Default, including all such out-of-pocket expenses incurred during any workout, restructuring or related negotiations in respect of such Obligations[; provided that] and one counsel

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for the ABL Term Lenders in connection with the enforcement and protection of their rights in connection with the Loan Documents, including all such out-of-pocket expenses incurred during any workout, restructuring or related negotiation in respect of any ABL Term Loan; provided that (1) the Lenders (other than the ABL Term Lenders) who are not the Agents shall be entitled to reimbursement for no more than one counsel representing all such Lenders (absent a conflict of interest in which case the Lenders may engage and be reimbursed for one additional counsel to the affected Lenders similarly situated, taken as a whole), and (2) the ABL Term Credit Parties shall by entitled to reimbursement for no more than one domestic counsel and one Canadian counsel, and of other local counsel in each relevant jurisdiction retained by the ABL Term Loan Agent representing all of the ABL Term Credit Parties (absent a conflict of interest in which case the ABL Term Credit Parties may engage and by reimbursed for additional counsel in each relevant jurisdiction to the affected ABL Term Credit Parties similarly situated, taken as a whole); provided that Credit Party Expenses shall not include the allocation of any overhead expenses of any Credit Party.

Customer Credit Liabilities” means at any time, the aggregate remaining balance at such time of (a) outstanding gift certificates and gift cards for use at the Borrower entitling the holder thereof to use all or a portion of the certificate or gift card to pay all or a portion of the purchase price for any Inventory, and (b) outstanding merchandise credits and customer deposits of the Borrower.

Customs Broker Agreement” means an agreement in substantially the form attached as Exhibit B annexed hereto, among the Borrower, a customs broker, freight forwarder, consolidator or other carrier, and the Collateral Agent, in which the customs broker, freight forwarder, consolidator or other carrier acknowledges that it has control over and holds the documents evidencing ownership of the subject Inventory for the benefit of the Collateral Agent and agrees, upon notice from the Collateral Agent, to hold and dispose of the subject Inventory and other property solely as directed by the Collateral Agent.

DDAs” means any checking or other demand deposit account maintained by the Loan Parties.

Debt Maturity Reserve” means during any Debt Reserve Period, an amount equal to the then outstanding principal balance of any Indebtedness of the type described in clause (t) of the definition of “Permitted Indebtedness” outstanding on the date which is ninety (90) days prior to the maturity date of such Indebtedness, which Debt Maturity Reserve shall remain in place (but shall be reduced to give effect to any payments of Indebtedness made during such Debt Reserve Period to the extent such payments are permitted hereunder) until the earlier of the repayment of such Indebtedness (including as a result of refinancing of such Indebtedness so long as the term of such refinancing Indebtedness (any such refinancing Indebtedness, the “Refinancing Debt”) is at least one hundred eighty (180) days) or the extension of the maturity date of such Indebtedness to a date which is at least one hundred eighty (180) days after the then maturity date of such Indebtedness.

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Debt Reserve Period means the period beginning on the 90th day prior to the maturity date of any Indebtedness of the type described in clause (t) of the definition of “Permitted Indebtedness” and in each case ending on the date of the repayment in full of such Indebtedness. If and to the extent that such Indebtedness is repaid by virtue of any Refinancing Debt, a subsequent Debt Maturity Reserve shall be imposed in an amount equal to the outstanding principal balance of such Refinancing Debt from and after the date that is ninety (90) days prior to the maturity date of such Refinancing Debt.

Debt Service Charges” means for any period, the sum of (i) Consolidated Interest Expense paid or required to be paid in cash for such period, plus (ii) Consolidated Rent Expense for such period, plus (iii) scheduled and mandatory principal payments made or required to be made on account of Indebtedness (excluding (a) inter-company Indebtedness, (b) any payments made to a holder of a Lien on any asset that is sold or that is the subject of any condemnation, casualty or eminent domain proceeding, in each case to the extent the proceeds therefrom are used to pay the Indebtedness so secured, and (c) Loan payments to the extent such payments were not made in connection with a permanent reduction of the [Total]Revolving Commitments) (including, without limitation, on account of Capitalized Lease Obligations) for such period, in each case determined in accordance with GAAP.

Deeds of Hypothec” means, collectively, (i) the Deed of Movable Hypothec (governed by Quebec law), dated as of April 4, 2011, and (ii) the Deed of Hypothec and Issue of Bonds (governed by Quebec law) dated as of May 28, 2014, in each case entered into among each Loan Party (with Collateral located in Quebec) and the Collateral Agent for the benefit of the Credit Parties thereunder.

Default” means any event or condition described in SECTION 7.01 that constitutes an Event of Default or that upon notice, lapse of any cure period set forth in SECTION 7.01 or both would, unless cured or waived, become an Event of Default.

Default Rate” has the meaning provided in SECTION 2.12.

Defaulting Lender” means, subject to SECTION 2.26(b), any Revolving Lender that (a) has defaulted in its monetary obligations under this Agreement, including any failure to (i) fund all or any portion of its Revolving Credit Loans within one Business Day of the date such Revolving Credit Loans were required to be funded hereunder, or (ii) pay to any Agent, any Issuing Bank, the Swingline Lender or any other Revolving Lender any other amount required to be paid by it hereunder (including in respect of its participation in Letters of Credit or Swingline Loans) within two Business Days of the date when due, (b) has notified the Borrower, any Agent, any Issuing Bank or the Swingline Lender in writing that it does not intend to comply with its funding obligations hereunder, or has made a public statement to that effect or with respect to agreements under which such Revolving Lender commits to extend credit generally, (c) has failed, within two Business Days after written request by the Administrative Agent or the Borrower, to confirm in writing to the Administrative Agent and the Borrower that it will comply with its prospective funding obligations hereunder (provided that such Revolving Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon receipt of such written confirmation by the Administrative Agent and the Borrower), or (d) has, or has a direct or indirect parent company that has, (i) become the subject of a proceeding under the Bankruptcy Code, the BIA, the WURA or the CCAA or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, (ii) had appointed

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for it a receiver, custodian, conservator, trustee, administrator, assignee for the benefit of creditors or similar Person charged with reorganization or liquidation of its business or assets, including the Federal Deposit Insurance Corporation or any other state or federal regulatory authority acting in such a capacity or, in each case under clauses (d)(i) and (d)(ii) above, has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in, any such proceeding or appointment, or (iii) become the subject of a Bail-in Action; provided that a Revolving Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any Capital Stock in that Revolving Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Revolving Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Revolving Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Revolving Lender. Any determination by any Agent that a Revolving Lender is a Defaulting Lender under any one or more of clauses (a) through (d) above, and of the effective date of such status, shall be conclusive and binding absent manifest error, and such Revolving Lender shall be deemed to be a Defaulting Lender (subject to SECTION 2.26(b)) as of the date established therefor by the Administrative Agent in a written notice of such determination, which shall be delivered by the Administrative Agent to the Borrower, the Issuing Banks, the Swingline Lender and each other Revolving Lender promptly following such determination.

Designated Jurisdiction” means any country or territory to the extent that such country or territory itself is the subject of any Sanction.

“DIP Financing” shall mean, in connection with a proceeding under the Bankruptcy Code, the BIA, the WURA, the CCAA or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, with respect to a Loan Party, the consensual use of Party (including, in either event, all of the terms and conditions established and/or approved in connection with the consensual use of cash collateral, financing or financial accommodations) by one or more, Credit Parties, permitted under and subject to Applicable Law, and pursuant to an order of a court of competent jurisdiction.

Disbursement Accounts” shall have the meaning set forth in SECTION 2.18(f).

Disclosed Matters” means the actions, suits and proceedings and the environmental matters disclosed in the Information Certificate and in the litigation report as provided to the Administrative Agent prior to the Effective Date.

dollars” or “$” refers to lawful money of the United States of America.

Domestic Subsidiary” means any Subsidiary of any of the Loan Parties organized under the laws of the United States of America or any state thereof.

EEA Financial Institution” means (a) any credit institution or investment firm established in any EEA Member Country which is subject to the supervision of an EEA Resolution Authority, (b) any entity established in an EEA Member Country which is a parent of an institution described in clause (a) of this definition, or (c) any financial institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent.

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EEA Member Country means any of the member states of the European Union, Iceland, Liechtenstein, and Norway.

EEA Resolution Authority” means any public administrative authority or any person entrusted with public administrative authority of any EEA Member Country (including any delegee) having responsibility for the resolution of any EEA Financial Institution.

Effective Date” means the date upon which all the conditions precedent in SECTION 4.01 are satisfied or waived in accordance with the provisions hereof.

Eligible Assignee” means a bank, insurance company, or company engaged in the business of making commercial loans having, solely, in the case of an assignment of Revolving Commitments, a combined capital and surplus in excess of $300,000,000, or any Credit Party or Affiliate of any Credit Party, or a Related Fund of any Credit Party, or any Person to whom a Credit Party assigns its rights and obligations under this Agreement as part of an assignment and transfer of such Credit Party’s rights in and to a material portion of such Credit Party’s portfolio of asset based credit facilities; provided, however, that, for the avoidance of doubt, an “Eligible Assignee” shall not include the Borrower, any of the Borrower’s Subsidiaries, any Defaulting Lender, or any natural Person (or any holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural Person). For the purposes of this Agreement, “Related Fund” shall mean, with respect to any Credit Party which is a fund that invests in loans, any other such fund managed by the same investment advisor as such Credit Party or by an Affiliate of such Credit Party or such advisor.

Eligible Credit Card Receivables” means, as of any date of determination, Accounts due to the Borrower from major credit card processors, including, VISA, Mastercard, American Express, Diners Club, Discover and private label credit card processors or purchasers, in each case acceptable to the Administrative Agent, in its reasonable discretion, as arise in the ordinary course of business, which have been earned by performance. None of the following shall be deemed to be Eligible Credit Card Receivables:

(a)Accounts due from major credit card processors that have been outstanding for more than five (5) Business Days from the date of transmission, or for such longer period(s) as may be approved by the Agents;

(b)Accounts due from major credit card processors with respect to which the Borrower does not have good, valid and marketable title thereto, free and clear of any Lien (other than (i) Liens granted to the Collateral Agent for its own benefit and the ratable benefit of the other Credit Parties pursuant to the Security Documents, and (ii) Permitted Encumbrances);

(c)Accounts due from major credit card processors that are not subject to a perfected first priority security interest or hypothec in favor of the Collateral Agent, for its own benefit and the ratable benefit of the other Credit Parties;

(d)Accounts due from major credit card processors which are disputed or with respect to which a claim, counterclaim, offset or chargeback has been asserted by the related credit card processor (but only to the extent of such dispute, counterclaim, offset or chargeback) (it being the intent that chargebacks in the ordinary course by the credit card processors shall not be deemed violative of this clause);

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(e)Accounts acquired in a Permitted Acquisition, unless (i) the Agents shall have received or conducted (A) a commercial finance examination satisfactory to the Agents with respect to such Accounts to be acquired in such Acquisition and (B) such other due diligence as the Agents may reasonably require, all of the results of the foregoing to be reasonably satisfactory to the Agents, and (ii) the Administrative Agent shall have determined an advance rate with respect to such Accounts, provided that such advance rate is equal to or less than the Credit Card Advance Rate;

(f)Except as otherwise approved by the Agents, Accounts due from major credit card processors as to which the credit card processor has the right under certain circumstances to require the Borrower to repurchase the Accounts from such credit card processor; or

(g)Accounts due from a credit card processor which the Administrative Agent, in its reasonable discretion, determines to be unlikely to be collected due to any bankruptcy or insolvency proceeding of such credit card processor.

Eligible In-Transit Inventory” means, as of the date of determination thereof (without duplication of other Eligible Inventory), Inventory:

(a)Which has been shipped, or is waiting to be shipped and is not under the control of the seller of such Inventory and otherwise satisfies each of the requirements of this definition, from a foreign location for receipt by the Borrower within forty-five (45) days of the date of determination, but which has not yet been delivered to the Borrower;

(b)For which title has passed to the Borrower;

(c)For which the document of title reflects the Borrower as the consignee and the shipper, or any other circumstance as to which the Collateral Agent has control over the documents of title which evidence ownership of the subject Inventory (such as by the delivery of a Customs Broker Agreement);

(d)Which is insured for not less than replacement cost; and

(e)Which otherwise would constitute Eligible Inventory;

provided that the Administrative Agent may, in its reasonable discretion, exclude any particular Inventory from the definition of “Eligible In-Transit Inventory” in the event the Administrative Agent determines that such Inventory is subject to any Person’s right of reclamation, repudiation, stoppage in transit or any event has occurred or is reasonably anticipated by the Administrative Agent to arise which may otherwise adversely impact the value of such Inventory or the ability of the Agents to realize upon such Inventory.

Eligible Inventory” means, as of the date of determination thereof, without duplication, (i) Eligible Letter of Credit Inventory, (ii) Eligible In-Transit Inventory, and (iii) items of Inventory of the Borrower that are finished goods, merchantable and readily saleable to the public in the ordinary course that are not excluded as ineligible by virtue of the one or more of the criteria set forth below. None of the following shall be deemed to be Eligible Inventory:

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(a)Inventory that is not solely owned by the Borrower, or is leased by or is on consignment to the Borrower, or the Borrower does not have good and valid title thereto;

(b)Inventory (other than any Eligible Letter of Credit Inventory and/or Eligible In-Transit Inventory) that is (i) not located in the United States of America or Canada, or (ii) not located at a location that is owned or leased by the Borrower (other than with respect to Inventory in transit between the Borrower’s stores and distribution centers within the United States or Canada), except, with respect to such locations described in this clause (ii) (other than public warehouses, as to which clause (i) below shall apply), to the extent that the Borrower has furnished the Collateral Agent with (A) any UCC financing statements, PPSA filings, Civil Code of Quebec filings or publishings or other registrations that the Collateral Agent may reasonably determine to be necessary to perfect its security interest in such Inventory at such location, and (B) a Collateral Access Agreement executed by the Person owning any such location on terms reasonably acceptable to the Agents;

(c)Except as otherwise agreed by the Agents, Inventory that represents goods which (i) are damaged, defective, “seconds,” or otherwise unmerchantable, (ii) are to be returned to the vendor, (iii) are obsolete items or custom items for the end user of Inventory, work in process, raw materials, or that constitute spare parts or supplies used or consumed in the Borrower’s business or (iv) are bill and hold goods;

(d)Inventory that represents goods that do not conform in all material respects to the representations and warranties contained in this Agreement or any of the Security Documents;

(e)Inventory that is not subject to a perfected first priority security interest in favor of the Collateral Agent, for its own benefit and the ratable benefit of the other Credit Parties (subject, with respect to priority only, to Permitted Encumbrances entitled to priority by operation of Applicable Law);

(f)Inventory which consists of samples, labels, bags, packaging or shipping materials, and other similar non-merchandise categories;

(g)Inventory as to which insurance in compliance with the provisions of SECTION 5.07 hereof is not in effect;

(h)Inventory acquired in a Permitted Acquisition, unless (i) the Agents shall have received or conducted (A) appraisals, from appraisers reasonably satisfactory to the Agents and Borrower, of such Inventory to be acquired in such Acquisition and (B) such other due diligence, including, without limitation, commercial finance examinations, as the Agents may reasonably require, all of the results of the foregoing to be reasonably satisfactory to the Agents, and (ii) the Administrative Agent shall have determined an advance rate with respect to such Inventory, provided that such advance rate is equal to or less than the Appraisal Percentage;

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(i)Inventory located at any distribution centers or public warehouses (solely to the extent that any such public warehouse is utilized by the Borrower, any of its Subsidiaries or any of their respective agents for the storage of property for more than ten (10) consecutive Business Days) unless the Collateral Agent has received a Collateral Access Agreement, or if no such Collateral Access Agreement is obtained, an Availability Reserve shall be established with respect to such location in an amount equal to two (2) months’ rent; or

(j)Inventory located at any stores which are closed, other than in the ordinary course of business.

Eligible Letter of Credit Inventory” means, as of the date of determination thereof (without duplication of other Eligible Inventory), Inventory:

(a)Not yet delivered to the Borrower;

(b)The purchase of which is supported by a Commercial Letter of Credit having a then remaining expiry of not more than seventy-five (75) days;

(c)For which, if requested by the Collateral Agent, the Collateral Agent has control over the documents of title which evidence ownership of the subject Inventory (such as by the delivery of a Customs Broker Agreement); and

(d)Which otherwise would constitute Eligible In-Transit Inventory;

provided that the Administrative Agent may, in its reasonable discretion, exclude any particular Inventory from the definition of “Eligible Letter of Credit Inventory” in the event the Administrative Agent determines that such Inventory is subject to any Person’s right of reclamation, repudiation, stoppage in transit or any event has occurred or is reasonably anticipated by any Agent to arise which may otherwise adversely impact the ability of the Agents to realize upon such Inventory.

Environmental Laws” means all Applicable Laws issued, promulgated or entered into by or with any Governmental Authority, relating in any way to the protection of human health or the environment, to the preservation or reclamation of natural resources, to the handling, treatment, storage, disposal of Hazardous Materials or to the assessment or remediation of any Release or threatened Release of any Hazardous Material or to the environment.

Environmental Liability” means any liability, contingent or otherwise (including, without limitation, any liability for damages, natural resource damage, costs of environmental remediation, administrative oversight costs, fines, penalties or indemnities), of any Loan Party directly or indirectly resulting from or based upon (a) violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials in violation of Environmental Laws, (c) exposure to any Hazardous Materials in violation of Environmental Laws, (d) the Release or threatened Release of any Hazardous Materials into the environment in violation of Environmental Laws, (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing, or (f) the existence of Hazardous Material on, from, under or about any owned or formerly owned or occupied Real Estate of any Loan Party or any of its Subsidiaries in violation of Environmental Laws.

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ERISA means the Employee Retirement Income Security Act of 1974, as amended from time to time and the regulations promulgated and rulings issued thereunder.

ERISA Affiliate” means any trade or business (whether or not incorporated) that, together with the Parent, is treated as a single employer within the meaning of Section 414(b) or (c) of the Code (and Sections 414(m) and (o) of the Code for purposes of provisions relating to Section 412 of the Code).

ERISA Event” means (a) a Reportable Event with respect to a Pension Plan (other than a Multiemployer Plan); (b) the existence with respect to any Pension Plan of a failure to make the “minimum required contribution” (as defined in Section 430 of the Code or Section 303 of ERISA) or with respect to a Multiemployer Plan of an “accumulated funding deficiency” (as defined in Section 431 of the Code or Section 304 of ERISA), whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Pension Plan; (d) the incurrence by the Parent or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Pension Plan; (e) the receipt by the Parent or any ERISA Affiliate from the PBGC or a Plan administrator of any notice relating to an intention to terminate any Pension Plan or to appoint a trustee to administer any Pension Plan(s); (f) the incurrence by the Parent or any of its ERISA Affiliates of any liability with respect to (i) the withdrawal from a Pension Plan subject to Section 4063 of ERISA during a plan year in which it was a “substantial employer” (as defined in Section 4001(a)(2) of ERISA) or (ii) the cessation of operations by the Parent or any ERISA Affiliate which is treated as such a withdrawal under Section 4062(e) of ERISA; or (g) the incurrence by the Parent or any ERISA Affiliate of any Withdrawal Liability or receipt by the Parent or any ERISA Affiliate of notification that a Multiemployer Plan is in reorganization.

EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule published by the Loan Market Association (or any successor person), as in effect from time to time.

Event of Default” has the meaning assigned to such term in SECTION 7.01. An “Event of Default” shall be deemed to have occurred and to be continuing unless and until that Event of Default has been duly waived in writing in accordance with the terms of this Agreement.

Excluded DDA” means (i) a DDA which solely contains funds not constituting proceeds of the ABL Priority Collateral (it being understood that if such DDA contains any proceeds of ABL Priority Collateral, it shall not constitute an Excluded DDA), (ii) a Trust Funds DDA, and (iii) a Disbursement Account.

Excluded Swap Obligation” means, with respect to any Loan Party, any Swap Obligation if, and to the extent that, all or a portion of the guaranty by such Loan Party under the Facility Guarantee of, or the grant under a Loan Document by such Loan Party of a security interest to secure, such Swap Obligation (or any guaranty thereof) is or becomes illegal under the Commodity Exchange Act or any rule, regulation or order of the Commodity Futures Trading Commission (or the application or official interpretation thereof) by virtue of such Loan Party’s failure for any reason to constitute an “eligible contract participant” as defined in the Commodity Exchange Act (determined after giving effect to SECTION 9.23 hereof and any and all guarantees of such Loan Party’s Swap Obligations by other Loan Parties) at the time the guaranty of such Loan Party, or grant by such Loan Party of a security interest, becomes effective with respect to such Swap Obligation. If a Swap Obligation arises under a master agreement governing more than one Financial Hedges, such exclusion shall apply only to the portion of such Swap Obligation that is attributable to Financial Hedges for which such guaranty or security interest is or becomes illegal.

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Excluded Taxes means any of the following Taxes imposed on or with respect to any Recipient or required to be withheld or deducted from a payment to a Recipient, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result of such Recipient being organized under the laws of, or having its principal office or, in the case of any Lender, its Lending Office located in, the jurisdiction imposing such Tax (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) in the case of a Lender, U.S. federal withholding Taxes imposed on amounts payable to or for the account of such Lender with respect to an applicable interest in a Loan or Commitment pursuant to a law in effect on the date on which (i) such Lender acquires such interest in the Loan or Commitment (other than pursuant to an assignment request by the Borrower under SECTION 2.24) or (ii) such Lender changes its Lending Office, except in each case to the extent that, pursuant to SECTION 2.23(a)(ii) or (c), amounts with respect to such Taxes were payable either to such Lender’s assignor immediately before such Lender became a party hereto or to such Lender immediately before it changed its Lending Office, (c) Taxes attributable to such Recipient’s failure or inability (other than as a result of a Change in Law) to comply with SECTION 2.23(e) and (d) any U.S. federal withholding Taxes imposed pursuant to FATCA.

Existing Letters of Credit” means each of the Letters of Credit issued by a Lender and outstanding on the Effective Date, as set forth in the Information Certificate.

Existing Obligations” has the meaning provided in SECTION 9.22.

Facility Guarantee” means any Guarantee of the Obligations executed by the Facility Guarantors in favor of the Agents and the other Credit Parties.

Facility Guarantors” means (i) the Parent and each of the Material Domestic Subsidiaries of the Parent, as listed on Schedule 1.2, (ii) each of the wholly-owned Material Domestic Subsidiaries of the Parent hereafter created or acquired, and (iii) any other Subsidiary of the Parent that Guarantees any Indebtedness incurred by the Borrower pursuant to the Term Loan Facility (or is a co-borrower with the Borrower thereunder) or any Indebtedness which is pari passu with or junior to the Liens securing the Term Loan Facility or unsecured, or any refinancings, replacements, extensions or renewals of any Indebtedness permitted hereunder.

Facility Guarantors’ Collateral Documents” means all security agreements, pledge agreements, deeds of trust, deeds of hypothec, intellectual property security agreements, and other instruments, documents or agreements executed and delivered by the Facility Guarantors to secure the Facility Guarantee and the Obligations.

FATCA” means Sections 1471 through 1474 of the Code as of the Effective Date (or any amended or successor version that is substantively comparable), any current or future regulations or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code.

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Federal Funds Effective Rate means, for any day, the rate per annum equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers on such day, as published by the Federal Reserve Bank of New York on the Business Day next succeeding such day; provided that (a) if such day is not a Business Day, the Federal Funds Rate for such day shall be such rate on such transactions on the next preceding Business Day as so published on the next succeeding Business Day, and (b) if no such rate is so published on such next succeeding Business Day, the Federal Funds Rate for such day shall be the average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%) charged to Bank of America on such day on such transactions as determined by the Administrative Agent.

Fee Letter” means the Fee Letter dated as of May 10, 2017 by and among the Borrower, Bank of America, N.A. and Merrill Lynch, Pierce, Fenner & Smith Incorporated.

“FILO Borrowing Base” means, at any time of calculation, an amount equal to:

(a)the face amount of Eligible Credit Card Receivables multiplied by the Credit Card Advance Rate for the FILO Borrowing Base;

plus

(b)the Appraised Inventory Value of Eligible Inventory (but excluding Eligible In-Transit Inventory and Eligible Letter of Credit Inventory), net of Inventory Reserves, multiplied by the Cost of Eligible Inventory (but excluding Eligible In-Transit Inventory and Eligible Letter of Credit Inventory) multiplied by the Inventory Appraisal Percentage for the FILO Borrowing Base;

plus

(c)the Appraised Inventory Value of Eligible In-Transit Inventory and Eligible Letter of Credit Inventory net of Inventory Reserves, multiplied by the Cost of Eligible In-Transit Inventory and Eligible Letter of Credit Inventory multiplied by the Appraisal Percentage for the FILO Borrowing Base;

“FILO Lender” means, at any time, each Person that makes a FILO Loan to the Borrower in the amount set forth opposite such Lender’s name on Schedule 1.1 hereto or as may be subsequently set forth in the Register from time to time.

“FILO Loan” means the term loan made by each of the FILO Lenders to the Borrower on the First Amendment Effective Date. The aggregate principal amount of the FILO Loan on the First Amendment Effective Date is $15,000,000.

“FILO Notes” means the promissory notes of the Borrower substantially in the form of Exhibit D-1, each payable to a FILO Lender evidencing FILO Loans made to the Borrower.

“FILO Percentage” shall mean, with respect to each FILO Lender, that percentage of the FILO Loans of all the FILO Lenders hereunder held by such FILO Lender, in the amount set forth opposite such Lender’s name on Schedule 1.1 hereto or as may be subsequently set forth in the Register from time to time, as the same may be increased or reduced from time to time pursuant to this Agreement.

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“FILO Reserve” means an amount, at any time of calculation, equal to the excess of the then outstanding amount of the portion of the FILO Loan over the FILO Borrowing Base as reflected in the most recent Borrowing Base Certificate furnished by the Borrower. If at any time the circumstances giving rise to any imposition of the FILO Reserve have ceased to exist then immediately following receipt of a Borrowing Base Certificate in accordance with the terms hereof reflecting that no FILO Reserve is then applicable, the Administrative Agent shall remove such FILO Reserve.

Financial Hedge” means, for any Loan Party, any present or future, whether master or single, agreement, document, or instrument providing for, or constituting an agreement to enter into, (a) any commodity hedge, (b) any arrangement for foreign-currency-exchange protection, and (c) any interest-rate swap, cap, collar, or similar arrangement, including, without limitation, any “swap agreement” (as defined in 11 U.S.C.§101, as in effect from time to time, or any successor statute).

Financial Officer” means, with respect to any Loan Party, the chief financial officer, treasurer, controller or vice president of accounting and reporting of such Loan Party.

“First Amendment” means the First Amendment to Second Amended and Restated Credit Agreement, dated as of December 14, 2018, by and among the Borrower, the Facility Guarantors, the Lenders party thereto the Agents, the ABL Term Loan Agent and the other parties party thereto.

“First Amendment Effective Date” has the meaning given to such term in the First Amendment.

“First Amendment Fee Letter” means the Fee Letter dated as of December 14, 2018 by and among the Borrower, Bank of America, N.A. and Merrill Lynch, Pierce, Fenner & Smith Incorporated.

Fiscal Month” means any fiscal month of any Fiscal Year, which month shall generally end as described on attached Schedule 1.3.

Fiscal Quarter” means any fiscal quarter of any Fiscal Year, which quarters shall generally end as described on attached Schedule 1.3.

Fiscal Year” means any period of twelve consecutive months ending as described on attached Schedule 1.3.

Foreign, Subsidiary” means any Subsidiary that is organized under the laws of a jurisdiction other than the United States of America or any State thereof or the District of Columbia.

Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with respect to any Issuing Bank, such Defaulting Lender’s Revolving Commitment Percentage of the Letter of Credit Outstandings other than Letter of Credit Outstandings as to which such Defaulting Lender’s participation obligation has been reallocated to other Revolving Lenders or cash collateralized in accordance with SECTION 2.26, and (b) with respect to the Swingline Lender, such Defaulting Lender’s Revolving Commitment Percentage of Swingline Loans other than Swingline Loans as to which such Defaulting Lender’s participation obligation has been reallocated to other Revolving Lenders in accordance with SECTION 2.26.

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GAAP means accounting principles which are generally accepted in the United States in effect and applicable to that accounting period in respect of which reference to GAAP is being made, and consistently applied for all periods reported, subject to SECTION 1.03.

General Security Agreement” means the Canadian Amended and Restated General Security Agreement (governed by Ontario law) dated as of June 3, 2014, entered into among each Loan Party (with Collateral located in Canada) and the Collateral Agent for the benefit of the Credit Parties thereunder.

Governmental Authority” means the government of the United States of America, Canada, or any other nation or any political subdivision thereof, whether state, provincial or local, and any agency, authority, instrumentality, regulatory body, court, tribunal, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

Government Securities” means (to the extent they mature within one (1) year from the date in question) readily marketable (a) direct full faith and credit obligations of the United States of America or Canada or obligations guaranteed by the full faith and credit of the United States of America or Canada, and (b) obligations of an agency or instrumentality of, or corporation owned, controlled, or sponsored by, the United States of America or Canada that are generally considered in the securities industry to be implicit obligations of the United States of America or Canada, as applicable.

Guarantee” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness or other obligation of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness or other obligation of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or other obligation or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness or obligation, provided that the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business.

Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes, mold, fungi or similar bacteria, and all other substances or wastes of any nature regulated pursuant to any Environmental Law because of their dangerous or deleterious properties, including any material listed as a hazardous substance under Section 101(14) of CERCLA.

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“Inadvertent Overadvances” means the funding of any Revolving Credit Loan or the issuance, renewal or amendment of a Letter of Credit which did not result in an Overadvance or the Borrower failing to be in compliance with SECTION 6.10 when made based upon the most recent Borrowing Base, Certificate received by the Administrative Agent prior to such funding or issuance, renewal or amendment of a Letter of Credit but which has, on the relevant date of determination, become an Overadvance, or caused the Borrower to not be in compliance with SECTION 6.10 as the result of circumstances beyond the reasonable control of the Administrative Agent or the other Revolving Lenders (including as the result of the entry of an adverse order for use of cash collateral by the United States Bankruptcy Court), including (i) a decline in the value of the Collateral included in the Borrowing Base, (ii) errors or fraud on a Borrowing Base Certificate, (iii) components of the Borrowing Base on any date thereafter being deemed ineligible, (iv) the return of uncollected checks or other items of payment applied to the reduction of Revolving Credit Loan or other similar involuntary or unintentional actions, (v) the imposition of any Reserve or a reduction in advance rates after the funding of any Revolving Credit Loan or the issuance, renewal or amendment of a Letter of Credit or (vi) any other circumstance beyond the reasonable control of the Administrative Agent or the other Revolving Lenders which reduces availability or the amount that can be borrowed under this Agreement.

Indebtedness” of any Person means, without duplication:

(a)All obligations of such Person for borrowed money (including any obligations which are without recourse to the credit of such Person);

(b)All obligations of such Person evidenced by bonds, debentures, notes or similar instruments;

(c)All obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person;

(d)All obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable and accrued liabilities incurred in the ordinary course of business);

(e)All Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed;

(f)All Guarantees by such Person of Indebtedness of others;

(g)All Capital Lease Obligations of such Person;

(h)All obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit and letters of guaranty;

(i)All obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances;

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(j)All Financial Hedges; and

(k)The principal and interest portions of all rental obligations of such Person under any Synthetic Lease, tax retention operating lease, off-balance sheet loan or similar off-balance sheet financing where such transaction is considered borrowed money indebtedness for tax purposes but is classified as an operating lease in accordance with GAAP as in effect on the Effective Date.

The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of any Loan Party under any Loan Document and (b) to the extent not otherwise described in clause (a) above, Other Taxes.

Indemnitee” has the meaning provided therefor in SECTION 9.03(b)

Information” has the meaning provided therefor in SECTION 9.15.

Information Certificate” means the Information Certificate dated as of the First Amendment Effective Date delivered by the Loan Parties to the Administrative Agent.

Intellectual Property Security Agreement” means the security agreements with respect to intellectual property dated as of April 30, 2014 by and among certain of the Loan Parties and the Collateral Agent.

Intercreditor Agreement” means that certain Intercreditor Agreement dated as of April 30, 2014 by and among the Administrative Agent for the Credit Parties and the Term Agent, as agent for the Term Loan Secured Parties (as defined in the Intercreditor Agreement) and acknowledged by the Loan Parties.

Interest Payment Date” means (a) with respect to any Prime Rate Loan (including a Swingline Loan), the first day of each calendar month and (b) with respect to any LIBO Loan, on the last day of the Interest Period applicable to the Borrowing of which such LIBO Loan is a part, and, in addition, if such LIBO Loan has an Interest Period of greater than ninety (90) days, the last day of every third month of such Interest Period.

“Interest Payment Date for ABL Term Loans” means with respect to any ABL Term Loan, the first day of each calendar month.

Interest Period” means, with respect to any LIBO Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one (1), two (2), three (3), six (6) or twelve (12) months thereafter, as the Borrower may elect by notice to the Administrative Agent in accordance with the provisions of this Agreement; provided, however, that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next

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succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, (b) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month during which such Interest Period ends) shall end on the last Business Day of the calendar month of such Interest Period, (c) any Interest Period that would otherwise end after the Termination Date shall end on the Termination Date, and (d) notwithstanding the provisions of clause (c), no Interest Period shall have a duration of less than one (1) month, and if any Interest Period applicable to a LIBO Borrowing would be for a shorter period, such Interest Period shall not be available hereunder. For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.

In-Transit Inventory” means Inventory of the Borrower which is in the possession of a common carrier and is in transit from a location outside of the United States to a location of the Borrower that is within the United States or Canada in which the Borrower has a store location or a distribution center.

Inventory” has the meaning assigned to such term in the Security Agreement or the General Security Agreement and, as regards inventory located in Canada, includes all “inventory” as defined in the PPSA.

Inventory Appraisal Percentage” means ([x) for the fiscal months of January, February and March each year, ninety-two and one-half percent (92.5%), and (y) at all other times, ninety percent (90]i) with respect to the Borrowing Base, ninety percent (90%), (ii) with respect to the FILO Borrowing Base, five percent (5%), and (iii) with respect to the ABL Term Borrowing Base, ten percent (10%).

Inventory Reserves” means such reserves as may be established from time to time by the Administrative Agent and without duplication of Availability Reserves, in the Administrative Agent’s reasonable commercial discretion exercised in good faith with respect to changes in the determination of the saleability, at retail, of the Eligible Inventory, which reflect such other factors as negatively affect the market value of the Eligible Inventory or which reflect claims and liabilities that the Administrative Agent determines in its reasonable discretion will need to be satisfied in connection with the realization upon the Inventory.

Investment” means with respect to any Person:

(a)The acquisition by such Person of any Capital Stock, evidence of Indebtedness or other security of another Person, including any option, warrant or right to acquire the same;

(b)Any loan, advance, contribution to capital, Guarantee of any obligation of another Person, extension of credit (except for current trade and customer accounts receivable for inventory sold or services rendered in the ordinary course of business and payable in accordance with customary trade terms) to another Person;

(c)Any Acquisition; and

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(d)Any other investment or interest in any Person that is required by GAAP to be classified on the balance sheet (excluding the footnotes) of the Borrower in the same manner as the other investments included in this definition to the extent such transactions involve the transfer of cash or other property,

in all cases whether now existing or hereafter made. The amount of any Investment outstanding at any time shall be the original cost of such Investment, reduced by any dividend, distribution, interest payment, return on capital, repayment or other amount received in cash by the Borrower or a Subsidiary in respect of such Investment.

Issuing Banks” means, individually and collectively, in its capacity as an issuer of Letters of Credit hereunder, any Revolving Lender (or any Person who was a Revolving Lender (or an Affiliate of such Revolving Lender at such time) at the time of issuance of the Letter of Credit). Any Revolving Lender, as Issuing Bank, may, in its discretion, arrange for one or more Letters of Credit to be issued by Affiliates of such Issuing Bank, in which case the term “Issuing Bank” shall include any such Affiliate with respect to Letters of Credit issued by such Affiliate. No Lender shall be an Issuing Bank unless such Revolving Lender shall have agreed in writing to serve as an Issuing Bank hereunder.

Joinder Agreement” shall mean an agreement, in form and substance reasonably satisfactory to Administrative Agent, pursuant to which, among other things, a Person becomes a party to, and bound by the terms of, this Agreement and/or the other Loan Documents in the same capacity and to the same extent as either a Borrower or a Facility Guarantor, as the Administrative Agent and the Borrower may agree.

L/C Credit Extension” means, with respect to any Letter of Credit, the issuance thereof or extension of the expiry date thereof, or the increase of the amount thereof.

Lease” means any written agreement, no matter how styled or structured, pursuant to which a Loan Party is entitled to the use or occupancy of any space in a structure, land, improvements or premises for any period of time.

Lenders” means the Persons identified on Schedule 1.1 hereto and each assignee that becomes a party to this Agreement as set forth in SECTION 9.04(b) and each Additional Commitment Lender that becomes a party to this Agreement as set forth in SECTION 2.02.

Letter of Credit” means a letter of credit that is issued by an Issuing Bank pursuant to this Agreement for the account of the Borrower, constituting either a Standby Letter of Credit or Commercial Letter of Credit, issued in connection with the purchase of Inventory by the Borrower and for other purposes for which the Borrower has historically obtained letters of credit, in the ordinary course of business of the Borrower and its Subsidiaries or for any other purpose that is reasonably acceptable to the Administrative Agent, and in form reasonably satisfactory to the Issuing Bank, provided that any Letter of Credit issued by a Person who was a Revolving Lender (or an Affiliate of such Revolving Lender at such time) at the time of issuance of a Letter of Credit, but is no longer a Revolving Lender, shall be deemed a Letter of Credit hereunder (other than for purposes of SECTIONS 2.19(c) and (d)) only until (i) such Letter of Credit has expired without being drawn, been returned undrawn, or has been otherwise terminated, or (ii) the amounts

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available thereunder have been drawn and such Person has received reimbursement for such drawing. Letters of Credit may permit payment by presentation of either a sight draft or a time draft (not to exceed ninety (90) days) as selected by the Borrower. Without limiting the foregoing, all Banker’s Acceptances and all Existing Letters of Credit shall for all purposes be deemed to be, and shall be subject to all provisions relating to, “Letters of Credit” hereunder.

Letter of Credit Disbursement” means a payment made by an Issuing Bank to the beneficiary of, and pursuant to, a Letter of Credit.

Letter of Credit Fees” means the fees payable in respect of Letters of Credit pursuant to SECTION 2.19(c).

Letter of Credit Outstandings” means, at any time, the sum of (a) the Stated Amount of all Letters of Credit outstanding at such time, plus (b) all amounts theretofore drawn or paid under Letters of Credit for which the Issuing Bank has not then been reimbursed.

LIBO Borrowing” means a Revolving Borrowing or the Borrowing of the FILO Loan comprised of LIBO Loans.

LIBO Loan” shall mean any Revolving Credit Loan or the amount of the outstanding FILO Loan bearing interest at a rate determined by reference to the Adjusted LIBO Rate in accordance with the provisions of Article II (other than a Prime Rate Loan).

LIBO Rate” means the per annum rate of interest (rounded up to the nearest 1/[8]16th of 1% and in no event less than zero) determined by the Administrative Agent at or about 11:00 a.m. (London time) two Business Days prior to an interest period for a term equivalent to such period, equal to the London Interbank Offered Rate, or comparable or successor rate approved by the Administrative Agent[ ] as published on the applicable Reuters screen page (or other commercially available source designated by the Administrative Agent from time to time); provided, that any comparable or successor rate shall be applied by the Administrative Agent, if administratively feasible, in a manner consistent with market practice.

Lien” means, with respect to any asset, (a) any lien, pledge, hypothecation, encumbrance (choate or inchoate), charge or security interest in, on or of such asset, and, with respect to the Collateral located in Canada, also includes any prior claim or deemed trust in, on or of such asset, and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such asset.

Line Cap” means, at any time of determination, the lesser of (a) the [Total Commitments or (b) the Borrowing Base] the sum of (a) the Revolving Line Cap, plus (b) the then outstanding amount of the FILO Loan, plus (c) the then outstanding amount of the ABL Term Loan.

Loan Account” has the meaning assigned to such term in SECTION 2.20.

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Loan Documents means this Agreement, the Notes, the Letters of Credit, the Fee Letter, the First Amendment Fee Letter, the ABL Term Loan Fee Letter, all Borrowing Base Certificates, the Blocked Account Agreements, the Collateral Access Agreements, the Customs Broker Agreements, the Credit Card Notifications, the Security Documents, the Facility Guarantee, the Facility Guarantors’ Collateral Documents, the Intercreditor Agreement, and any other instrument or agreement now or hereafter executed and delivered in connection herewith.

Loan Party” or “Loan Parties” means the Borrower and the Facility Guarantors.

Loans” means all Revolving Credit Loans, the FILO Loan, or the ABL Term Loan, as the context may require, and other advances to or for account of the Borrower pursuant to this Agreement.

Margin Stock” has the meaning assigned to such term in Regulation U.

Material Adverse Effect” means any event, fact, or circumstance, which, after the Effective Date, has a material adverse effect on, (a) the business, assets, financial condition or income of the Loan Parties taken as a whole, or (b) the validity or enforceability of this Agreement or the other Loan Documents, in any material respect, or any of the material rights or remedies of the Credit Parties hereunder or thereunder.

Material Contract” means, with respect to any Loan Party, each contract to which such Loan Party is a party and which has been filed or is required to be filed as an exhibit to any report filed by any Loan Party with the SEC.

Material Domestic Subsidiary” means as to any Person, a Domestic Subsidiary of such Person that, as of the end of the most recent Fiscal Quarter for which financial statements are available owns assets consisting of Inventory and Accounts of more than $20,000,000, individually. The designation of a Subsidiary as a “Material Domestic Subsidiary” shall be permanent notwithstanding any subsequent reduction in such Subsidiary’s assets, unless otherwise consented to by the Administrative Agent. As of the Effective Date, the Subsidiaries listed on Schedule 1.4 are not Material Domestic Subsidiaries.

Material Indebtedness” means Indebtedness (other than the Obligations and inter-company Indebtedness) of the Loan Parties in an aggregate principal amount exceeding $50,000,000. For purposes of determining the amount of Material Indebtedness at any time, the amount of the obligations in respect of any Financial Hedge at such time shall be calculated at the Agreement Value thereof.

[Maturity Date means June 2, 2022 ]“Maturity Date” means June 2, 2022; provided that to the extent the Maturity Date for the Revolving Credit Loans is extended pursuant to Section 9.02 of this Agreement, the Maturity Date of the ABL Term Loan shall also be automatically extended, but in no event shall the Maturity Date of the ABL Term Loan be extended to a date later than the date that is six years from the First Amendment Effective Pate without the consent of each ABL Term Lender.

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“Maximum Revolving Insolvency Amount” means the sum of (i) (A) the Borrowing Base plus (B) the FILO Borrowing Base plus (C) the ABL Term Borrowing Base, minus (D) the minimum Availability required to be maintained under SECTION 6.10 minus (E) the then outstanding principal amount of the ABL Term Obligations, plus (ii) Permitted Overadvances that satisfy the requirements contained in clauses (a) and (b) of the definition thereof (subject to the limitations set forth in clause (b) of such definition), plus (iii) in addition to the Permitted Overadvances described in clause (ii), Permitted Overadvances that satisfy the requirements contained in clause (a) of the definition thereof to fund (A) payroll in an amount not to exceed the aggregate amount required (and actually used) to fund payroll requests of the Loan Parties for a two-week period and (B) rent at the Loan Parties’ distribution centers and warehouses for a one-month period, plus (iv) after the commencement of any proceeding with respect to the Bankruptcy Code, BIA, WURA, CCAA or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, an amount not to exceed the result of (1) five percent (5.0%) of the sum of the Borrowing Base and the FILO Borrowing Base minus (2) the then outstanding amount of any Permitted Overadvances; provided that the amount set forth in this clause (iv) shall not be less than zero, plus (v) the amount of all Inadvertent Overadvances.

Maximum Rate” has the meaning provided therefor in SECTION 9.13

Minority Lenders” has the meaning provided therefor in SECTION 9.02(c)

Moody’s” means Moody’s Investors Service, Inc.

Multiemployer Plan” means any employee benefit plan of the type described in Section 4001(a)(3) of ERISA and subject to ERISA, to which the Parent or any ERISA Affiliate makes or is obligated to make contributions, or during the preceding five plan years, has made or been obligated to make contributions.

Multiple Employer Plan” means a Plan subject to ERISA which has two or more contributing sponsors (including the Parent or any ERISA Affiliate) at least two of whom are not under common control, as such a plan is described in Section 4064 of ERISA.

Net Proceeds” means, with respect to any event, (a) the cash proceeds received in respect of such event, including (i) any cash received in respect of any non-cash proceeds, but only as and when received, (ii) in the case of a casualty, insurance proceeds, and (iii) in the case of a condemnation or similar event, condemnation awards and similar payments, in each case net of (b) the sum of (i) all reasonable fees and out-of-pocket expenses (including appraisals, and brokerage, legal, title and recording tax expenses and commissions) paid by any Loan Party or a Subsidiary to third parties (other than Affiliates) in connection with such event, (ii) in the case of a sale or other disposition of an asset (including pursuant to a casualty or condemnation), the amount of all payments required to be made by any Loan Party as a result of such event to repay (or to establish an escrow for the repayment of) any Indebtedness (other than the Obligations and any other obligations secured by the Security Documents) secured by such asset or otherwise subject to mandatory prepayment as a result of such event, or a Permitted Encumbrance that is senior to the Lien of the Collateral Agent, and (iii) cash Taxes paid or reasonably estimated to be actually payable in cash in connection therewith (it being understood and agreed that (x) until actually paid, the amount of such Taxes shall be maintained in a segregated DDA of the Borrower and not used for any other purpose, and (y) upon payment of any such Taxes, “Net Proceeds” shall be deemed to include an amount equal to any amounts in excess of the Taxes actually paid and shall be promptly paid to the Administrative Agent).

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Non-Defaulting Lender means, at any time, each Revolving Lender that is not a Defaulting Lender at such time.

Notes” means, collectively, (i) Revolving Credit Notes[ and], (ii) the Swingline Note, (iii) the FILO Notes and (iv) the ABL Term Notes, each as may be amended, supplemented or modified from time to time.

Obligations” means [(a) the due and punctual payment of (i) the principal of, and interest against any Loan Party under the Bankruptcy Code, the BIA, the WURA or the CCAA or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding) on the Loans], as and when due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by the Loan Parties under this Agreement or any other Loan Document in respect of any Letter of Credit, when and as due, including payments in respect of reimbursement of disbursements, interest thereon and obligations to provide cash collateral and (iii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, this Agreement and the other Loan Documents, including, without limitation, for all such items under the Bankruptcy Code, the BIA, the WURA or the CCAA or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding, (b) the due and punctual payment and performance of all the covenants, agreements, obligations and liabilities of each Loan Party under or pursuant to this Agreement and the other Loan Documents, and (c) Other Liabilities[. ]the Revolving and FILO Obligations and/or the ABL Term Obligations, as the context may require.

OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.

Original Closing Date” means November 22, 2005.

Other Liabilities” means any transaction with any Agent, any Revolving Lender or any of their respective Affiliates, which arises out of any Bank Product or Cash Management Service provided by any such Person (including, for the avoidance of doubt, any Person to the extent such Person was an Agent, a Revolving Lender or an Affiliate of an Agent or a, Revolving Lender at the time such Bank Product or Cash Management Service was provided), as each may be amended from time to time.

Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as a result of a present or former connection between such Recipient and the jurisdiction imposing such Tax (other than connections arising from such Recipient having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under, engaged in any other transaction pursuant to or enforced any Loan Document, or sold or assigned an interest in any Loan or Loan Document).

Other Taxes” means all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from any payment made under, from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under, or otherwise with respect to, any Loan Document, except any such Taxes that are Other Connection Taxes imposed with respect to an assignment (other than an assignment made pursuant to SECTION 2.24).

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Overadvance means a [loan]Revolving Credit Loan, advance, or providing of credit support (such as the issuance of a Letter of Credit) to the extent that, immediately after its having been made, Availability is less than zero (or solely for purposes of determining the existence of a Permitted Overadvance, any such Revolving Credit Loan, advance, or providing of credit support resulting in Availability being less than the amount required pursuant SECTION 6.10).

Participant” shall have the meaning provided therefor in SECTION 9.04(e)

Parent” means Pier 1 Imports, Inc.

Participant Register” has the meaning provided therefor in SECTION 9.04(e).

Payment Conditions” means, with respect to any transaction or payment, (i) no Default under Sections 7.01(a), (b), (h), (i), or (j) has occurred or shall occur thereunder after giving effect to such transaction or payment, (ii) no Event of Default has occurred or shall occur after giving effect to such transaction or payment, (iii) after giving pro forma effect to such transaction or payment, Availability on the date of such transaction or payment and for the sixty (60) days preceding such transaction or payment shall be equal to or greater than fifteen percent (15%) of the Line Cap, (iv) after giving pro forma effect to such transaction or payment, the Consolidated Fixed Charge Coverage Ratio for the twelve months preceding such transaction or payment shall be equal to or greater than 1.00:1.00, and (v) the Borrower shall have provided a certification to the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions described in clauses (i) through (iv) above.

Paid in Full” means the date on which (i) the Commitments shall have expired or been terminated, the Lenders have no further obligation to make any Loans and the Issuing Banks shall have no further obligation to issue Letters of Credit hereunder, (ii) the principal of and interest on all Loans and all fees, expenses and indemnities and other Obligations (other than any contingent indemnification Obligations for which no claim has then been asserted) shall have been indefeasibly paid in full in cash, (iii) all Letters of Credit shall have expired or terminated or been cash collateralized to the extent provided herein (or, alternatively, the applicable Issuing Bank(s) shall have received, in form and substance and from an issuing bank reasonably satisfactory to the Administrative Agent and such Issuing Bank, a backstop letter of credit in an amount equal to 103% of the Letter of Credit Outstandings with respect to such Letters of Credit) and (iv) all Letter of Credit Disbursements shall have been reimbursed.

Payment in Full” shall have a correlative meaning.

PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity performing similar functions.

Pension Act” means the Pension Protection Act of 2006.

Pension Funding Rules” means the rules of the Code and ERISA regarding minimum required contributions (including any installment payment thereof) to Pension Plans and set forth in, with respect to plan years ending prior to the effective date of the Pension Act, Section 412 of the Code and Section 302 of ERISA, each as in effect prior to the Pension Act and, thereafter, Section 412, 430, 431, 432 and 436 of the Code and Sections 302, 303, 304 and 305 of ERISA.

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Pension Plan means any employee pension benefit plan (including a Multiple Employer Plan or a Multiemployer Plan) that is maintained or is contributed to by the Parent and any ERISA Affiliate and is either covered by Title W of ERISA or is subject to the minimum funding standards under Section 412 of the Code.

Permitted Acquisition” means an Acquisition in which each of the following conditions are satisfied:

(a)No Default or Event of Default then exists or would arise from the consummation of such Acquisition;

(b)If any proceeds of the Loan are to be used for such Acquisition, such Acquisition shall have been approved by the Board of Directors of the Person (or similar governing body if such Person is not a corporation) which is the subject of such Acquisition and such Person shall not have announced that it will oppose such Acquisition or shall not have commenced any action which alleges that such Acquisition will violate Applicable Law;

(c)If the Acquisition is an Acquisition of Capital Stock, a Loan Party shall own directly or indirectly a majority of the Capital Stock in the Person being acquired and shall Control a majority of any voting interests, and/or shall otherwise Control the governance of the Person being acquired;

(d)Any material assets acquired shall be utilized in, and if the Acquisition involves a merger, amalgamation, consolidation or stock acquisition, the Person which is the subject of such Acquisition shall be engaged in, a business otherwise permitted to be engaged in by the Borrower or any of its Subsidiaries under this Agreement;

(e)If the Person which is the subject of such Acquisition will be maintained as a Material Domestic Subsidiary of a Loan Party, or if the assets acquired in an acquisition will be transferred to a Material Domestic Subsidiary which is not a Loan Party, such Subsidiary shall have been joined as a “Loan Party” hereunder, and the Collateral Agent shall have received a first priority security interest, subject to the terms of the Intercreditor Agreement, in such Subsidiary’s Inventory and Accounts and other property of the same nature as constitutes collateral under the Security Documents in order to secure the Obligations; and

(f)(x) (i) the Payment Conditions shall have been satisfied, or (ii) after giving pro forma effect to such Acquisition, Availability on the date of such Acquisition and for the sixty (60) days preceding such Acquisition shall be equal to or greater than twenty percent (20%) of the Line Cap, or (iii) the Covenant Conditions shall have been satisfied, and (y) the Borrower shall have provided a certification to the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions described in clause (x)(i), (ii) or (iii), as applicable, above.

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Permitted Disposition means any of the following:

(a)licensed departments of a Loan Party or any of its Subsidiaries in the ordinary course of business;

(b)bulk sales or other dispositions of the Inventory of the Borrower not in the ordinary course of business in connection with store closings, at arm’s length, provided, that the Annual Store Closing Percentage shall not exceed ten percent (10%) in any Fiscal Year, provided, further that all sales of Inventory in connection with store closings which occur within any twelve (12) month period which are in the aggregate in excess of ten percent (10%) of the number of the Borrower’s stores in operation as of the Effective Date shall be in accordance with liquidation agreements and with professional liquidators reasonably acceptable to the Administrative Agent;

(c)Dispositions of equipment in the ordinary course of business that is substantially worn, damaged, obsolete or, in the judgment of a Loan Party, no longer used or useful in its business or that of any Subsidiary;

(d)Sales, transfers and dispositions among the Loan Parties;

(e)Any sale or sale-leaseback transaction of Real Estate owned by any of the Loan Parties, provided that, in the case of any such sale-leaseback, upon request by the Administrative Agent, the Loan Parties shall have delivered to the Administrative Agent a Collateral Access Agreement duly executed by the purchaser of such Real Estate on terms and conditions reasonably satisfactory to the Administrative Agent;

(f)Disposition of any assets or capital stock of any Subsidiary or Person which is not a Loan Party;

(g)The transfer of company-owned life insurance policies, participant contributions, and/or employer matching funds to one or more of the sub-trusts established under the Pier 1 Umbrella Trust, as amended, for the sole purpose of setting aside funds to be used to settle obligations under one or more non-qualified deferred compensation plans maintained by the Parent and its employing Subsidiaries; and

(h)Dispositions by Loan Parties to Subsidiaries of the Parent that are not Loan Parties in an aggregate amount of up to $100,000,000; provided that (i) no Default or Event of Default has occurred or shall occur after giving effect to such disposition, (ii) dispositions of assets of the type included in the Borrowing Bas; the FILO Borrowing Base or the ABL Term Borrowing Base shall be made for fair value and solely for cash consideration, [and](iii) in the event of a Disposition of Intellectual Property used or useful in connection with the assets, included in the Borrowing Base, the FILO Borrowing Base or the ABL Term Borrowing Base, the purchaser, assignee or other transferee thereof agrees, in writing to be bound by a non-exclusive, royalty-free worldwide license of such Intellectual Property in favor of the Collateral Agent for use in connection with the exercise of the rights and remedies of the Credit Parties, which license shall be in form and substance reasonably satisfactory to the Collateral Agent, and (iv) the proceeds received from each such disposition of assets constituting ABL Priority Collateral shall be applied in reduction of the Obligations pursuant to Section 2.17(c) hereof.

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Permitted Dividends means:

(a)Dividends with respect to Capital Stock payable solely in additional shares of or warrants to purchase common stock;

(b)Stock splits (traditional and reverse) or reclassifications of stock into additional or other shares of common stock;

(c)The declaration and payment of a dividend by any Subsidiary of a Loan Party to a Loan Party;

(d)Restricted Payments in an amount not to exceed $30,000,000 in the aggregate per year, so long as no Default or Event of Default has occurred or shall occur after giving effect to such Restricted Payments;

(e)Restricted Payments so long as the Covenant Conditions shall have been satisfied;

(f)Restricted Payments other than those described in clauses (d) and (e) above so long as (i) no Default or Event of Default has occurred or shall occur after giving effect to such Restricted Payment, (ii) after giving pro forma effect to such Restricted Payment, Availability on the date of such Restricted Payment and for the sixty (60) days preceding such Restricted Payment shall be equal to or greater than twenty percent (20%) of the Line Cap (without giving effect to the Specified Reserves), and (iii) the Borrower shall have provided a certification to the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions described in clause (i) through (ii) above; and

(g)other Restricted Payments so long as the Payment Conditions shall have been satisfied.

Permitted Encumbrances” means:

(a)Liens imposed by law for Taxes not yet due or, if past due, are being contested in compliance with SECTION 5.05;

(b)Carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s and other like Liens imposed by Applicable Law, arising in the ordinary course of business and securing obligations to the extent they are not overdue by more than thirty (30) days or, if overdue by more than thirty (30) days, are being contested in compliance with SECTION 5.05;

(c)Pledges and deposits made in the ordinary course of business in compliance with workers’ compensation, unemployment insurance and other social security laws or regulations;

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(d)Deposits to secure or relating to the performance of bids, trade contracts, leases, statutory obligations, surety and appeal bonds, performance bonds (and Liens arising in accordance with Applicable Law in connection therewith), and other obligations of a like nature, in each case in the ordinary course of business;

(e)Judgment Liens in respect of judgments that do not constitute an Event of Default under SECTION 7.01(1);

(f)Easements, covenants, conditions, restrictions, building code laws, zoning restrictions, rights-of-way, mineral leases or similar agreements and similar encumbrances on real property imposed by law or arising in the ordinary course of business that do not secure any monetary obligations and do not materially detract from the value of the affected property or materially interfere with the ordinary conduct of business of a Loan Party;

(g)Any Lien on any property or asset of any Loan Party set forth in the Information Certificate, and extensions, renewals and replacements thereof permitted under SECTION 6.01;

(h)Liens on fixed or capital assets acquired by any Loan Party which are permitted under SECTION 6.01 and described in clauses (e) and/or (j) of the definition of Permitted Indebtedness so long as (i) such Liens and the Indebtedness secured thereby are incurred prior to or within ninety (90) days after such acquisition or the completion of the construction or improvement thereof (other than refinancings thereof permitted hereunder), (ii) the Indebtedness secured thereby does not exceed one hundred percent (100%) of the cost of acquisition or improvement of such fixed or capital assets, together with any “soft costs” related thereto, and (iii) such Liens shall not extend to any other property or assets of the Loan Parties; provided that any Indebtedness provided by any lender secured by any Lien permitted under this clause (h) may also be secured by other fixed or capital assets which secure other Indebtedness provided by the same lender or its Affiliates permitted hereunder and which is secured by any Lien permitted under this clause (h);

(i)Liens in favor of the Collateral Agent for its own benefit and the benefit of the other Credit Parties;

(j)Landlords’ and lessors’ Liens in respect of rent not in default for more than thirty (30) days or the existence of which, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.

(k)Possessory Liens in favor of brokers and dealers arising in connection with the acquisition or disposition of Investments owned as of the Effective Date and Permitted Investments, provided that such liens (a) attach only to such Investments and (b) secure only obligations incurred in the ordinary course and arising in connection with the acquisition or disposition of such Investments and not any obligation in connection with margin financing;

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(l)Liens arising solely by virtue of any statutory or common law provisions relating to banker’s liens, liens in favor of securities intermediaries, rights of setoff or similar rights and remedies as to deposit accounts or securities accounts or other funds maintained with depository institutions or securities intermediaries;

(m)Liens on Real Estate or on the Capital Stock of the Persons owning such Real Estate to finance or refinance Indebtedness permitted by clause (h) of the definition of Permitted Indebtedness; provided that such Liens shall not apply to any property or assets of the Loan Parties other than the Real Estate or Capital Stock so financed or refinanced;

(n)Liens attaching solely to cash earnest money deposits in connection with any letter of intent or purchase agreement in connection with a Permitted Acquisition or a Permitted Investment of the type described in clauses (p) and/or (q) of the definition of “Permitted Investment”;

(o)Liens arising from precautionary UCC filings regarding “true” operating leases or the consignment of goods to a Party;

(p)Voluntary Liens on assets in existence at the time such assets are acquired pursuant to a Permitted Acquisition or on assets of a Subsidiary of the Borrower in existence at the time such Subsidiary is acquired pursuant to a Permitted Acquisition; provided that such Liens are not incurred in connection with or in anticipation of such Permitted Acquisition or such Permitted Investment and do not attach to any other assets of any Loan Party and provided further that in no event shall such assets be included as eligible for borrowing under the Borrowing Base, the FILO Borrowing Base or the ABL Term Borrowing Base;

(q)Liens in favor of customs and revenues authorities imposed by Applicable Law arising in the ordinary course of business in connection with the importation of goods and securing obligations (i) that are not overdue by more than thirty (30) days, (ii)(A) that are being contested in good faith by appropriate proceedings, (B) the applicable Loan Party or Subsidiary has set aside on its books adequate reserves with respect thereto in accordance with GAAP and (C) such contest effectively suspends collection of the contested obligation and enforcement of any Lien securing such obligation, or (iii) the existence of which would not reasonably be expected to result in a Material Adverse Effect;

(r)Liens placed on any of the assets or equity interests of a Foreign Subsidiary;

(s)Any interest or title of a licensor, sublicensor, lessor or sublessor under any license or operating or true lease agreement;

(t)Licenses, sublicenses, leases or subleases granted to third Persons in the ordinary course of business;

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(u)The replacement, extension or renewal of any Permitted Encumbrance; provided, that such Lien shall at no time be extended to cover any assets or property other than such assets or property subject thereto on the Effective Date or the date such Lien was incurred, as applicable;

(v)Liens arising by operation of law under Article 4 of the UCC (or any similar law in Canada) in connection with collection of items provided for therein;

(w)Liens arising by operation of law under Article 2 of the UCC (or any similar laws in Canada) in favor of a reclaiming seller of goods or buyer of goods;

(x)Liens on operating accounts subject to overdraft protection or securities accounts in connection with overdraft protection, netting and other similar services;

(y)Security given to a public or private utility or any Governmental Authority as required in the ordinary course of business;

(z)Liens on assets to secure Indebtedness permitted to be secured under clause (r) of the definition of “Permitted Indebtedness”;

(aa)Liens consisting of deposits in the ordinary course of business in an aggregate amount not to exceed $1,000,000 at any time outstanding;

(bb)Liens to secure Indebtedness permitted pursuant to clause (u) of the definition of Permitted Indebtedness and obligations with respect thereto, including obligations of the type described under the definitions of “Bank Products” and “Cash Management Services” entered into with lenders or agents under the Term Loan Documents and/or their Affiliates to the extent the Borrower elects to secure such obligations under the Term Loan Documents; provided that such Liens shall at all times be subject to the Intercreditor Agreement or an intercreditor in form and substance reasonably satisfactory to the Administrative Agent and duly executed by the Term Agent; and

(cc)Liens in favor of a financial institution encumbering deposits (including the right of setoff) held by such financial institution in the ordinary course of business in respect of Indebtedness permitted hereunder and which are within the general parameters customary in the banking industry.

Permitted Indebtedness” means each of the following:

(a)The Obligations;

(b)Indebtedness set forth in the Information Certificate and extensions, renewals and replacements of any such Indebtedness, so long as after giving effect thereto (i) the principal amount of the Indebtedness outstanding at such time is not increased (except by the amount of any accrued interest, reasonable closing costs, expenses, fees, and premium paid in connection with such extension, renewal or replacement), (ii) if the final maturity date of such Indebtedness set forth in the Information Certificate is prior to the Maturity Date, the result of such extension, renewal or replacement shall not be an earlier

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maturity date or decreased weighted average life and (iii) if the final maturity date of such Indebtedness set forth in the Information Certificate is after the Maturity Date, the result of such extension, renewal or replacement shall not be a maturity date earlier than the earlier of (A) a date that is at least six (6) months after the Maturity Date, or (B) the maturity date of the Indebtedness being refinanced;

(c)Indebtedness of any Loan Party to any other Loan Party or to any of their Affiliates;

(d)Guarantees by any Loan Party of Indebtedness or other obligations of (i) any other Loan Party, and (ii) any other Subsidiary of the Borrower so long as, in the case of this clause (ii), such Guarantees (together with any Investments made pursuant to subclause (y) of clause (i) and clause (p) of the definition of “Permitted Investments”) shall not exceed an aggregate principal amount of $150,000,000 at any time outstanding; provided that to the extent Guarantees are made pursuant to this clause (d)(ii) in an aggregate principal amount in excess of $75,000,000, on a pro forma basis, after giving effect to any Guarantees under this clause (d)(ii), either (1) the Total Outstandings shall not exceed more than 50% of the Line Cap, or (2) the Payment Conditions shall have been satisfied;

(e)Purchase money Indebtedness of any Loan Party to finance the acquisition or improvement of any fixed or capital assets, including Capital Lease Obligations (excluding therein any Indebtedness incurred in connection with sale or sale-leaseback transactions permitted under clause (j) of this definition), and any Indebtedness assumed in connection with the acquisition of any such assets or secured by a Lien on any such assets prior to the acquisition thereof (and not incurred in contemplation of such acquisition), and extensions, renewals and replacements of any such Indebtedness that do not increase the outstanding principal amount thereof or result in an earlier maturity date or decreased weighted average life thereof; provided, however, that the aggregate principal amount of Indebtedness permitted by this clause (e) shall not exceed $50,000,000 at any time outstanding;

(f)Indebtedness under Financial Hedges, other than for speculative purposes, entered into in the ordinary course of business;

(g)Contingent liabilities under surety bonds or similar instruments incurred in the ordinary course of business in connection with the construction or improvement of retail stores;

(h)Indebtedness incurred for the construction or acquisition of, or to finance or to refinance, any Real Estate owned by any Loan Party;

(i)Indebtedness with respect to the deferred purchase price for any Permitted Acquisition or any Permitted Investment of the type described in clauses (p) and/or (q) of the definition of “Permitted Investment”, provided that no such Indebtedness shall be secured by any of the ABL Priority Collateral and to the extent secured by Term Priority Collateral, shall be subject to the Intercreditor Agreement or an intercreditor agreement in form and substance reasonably satisfactory to the Administrative Agent and duly executed by the holder of such Indebtedness (or an agent on their behalf);

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(j)Indebtedness incurred in connection with sale and sale-leaseback transactions permitted hereunder;

(k)Subordinated Indebtedness;

(l)Indebtedness incurred by any Foreign Subsidiary for working capital or general corporate purposes which is not guaranteed by or secured by any assets of any Loan Party (other than the capital stock of such Foreign Subsidiary);

(m)Indebtedness constituting the obligation to make purchase price adjustments and indemnities in connection with Permitted Acquisitions or Permitted Investments of the type described in clauses (p) and/or (q) of the definition of “Permitted Investment”;

(n)Guarantees and letters of credit and surety bonds issued in connection with Permitted Acquisitions, Permitted Dispositions and Permitted Investments of the type described in clauses (p) and/or (q) of the definition of “Permitted Investment”;

(o)Indebtedness of any Loan Party acquired pursuant to a Permitted Acquisition (or Indebtedness assumed at the time and as a result of a Permitted Acquisition); provided, that in each case such Indebtedness was not incurred in connection with, or in anticipation or contemplation of, such Permitted Acquisition;

(p)Indebtedness relating to surety and appeal bonds, performance bonds and other obligations of a like nature incurred in the ordinary course of business;

(q)without duplication of any other Indebtedness, non-cash accruals of interest, accretion or amortization of original issue discount and/or pay-in-kind interest;

(r)other Indebtedness; provided that any such Indebtedness shall (i) have a maturity date of not less than six (6) months following the Maturity Date, (ii) not require any amortization of principal in excess of one percent (1.0%) of the original principal balance per annum until Payment in Full of the Obligations, (iii) except to the extent such Indebtedness does not exceed the aggregate principal amount of $100,000,000, be unsecured; provided further that any secured Indebtedness permitted pursuant to this clause (r) shall (A) not encumber any ABL Priority Collateral on a first lien basis and (B) be subject to an intercreditor agreement in form and substance reasonably satisfactory to the Administrative Agent and duly executed by the holder of such Indebtedness;

(s)Indebtedness relating to existing letters of credit obtained from Canadian financial institutions, as set forth in the Information Certificate;

(t)other unsecured Indebtedness in an aggregate principal amount not exceeding $100,000,000 at any time outstanding;

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(u)(i) Indebtedness under the Term Loan Facility, in an aggregate principal amount at any time outstanding not to exceed the sum of (A) $200,000,000 plus (B) the aggregate principal amount of any increase in the Term Loan Facility or any addition of new debt tranches under the Term Loan Agreement, in each case, permitted under the Term Loan Agreement (as in effect on April 30, 2014), plus (ii) any incremental equivalent Indebtedness permitted under the Term Loan Agreement (as in effect on April 30, 2014) which is pari passu with or junior to the Liens securing the Term Loan Facility or unsecured, so long as, in the case of clauses (i)(B) and (ii) hereunder, the sum of the aggregate initial principal amount of such facilities does not exceed the amount permitted to be incurred under the Term Loan Agreement (as in effect on April 30, 2014), and (iii) any refinancings, replacements, extensions or renewals of any Indebtedness permitted under clauses (i) or (ii) to the extent not otherwise prohibited hereunder and is in compliance with any restrictions contained in the Intercreditor Agreement or any other intercreditor agreement in form and substance reasonably satisfactory to the Administrative Agent with respect thereto, together with the amount of accrued interest, reasonable closing costs, expenses, fees, and premium paid in connection therewith; provided that the Indebtedness described in this clause (u) shall at all times be subject to the Intercreditor Agreement or an intercreditor in form and substance reasonably satisfactory to the Administrative Agent and duly executed by the Term Agent.

Permitted Investments” means each of the following:

(a)Government Securities;

(b)Collective investment funds created pursuant to Regulation 9 of the Office of the Comptroller of the Currency of the United States, rated AAA by S&P or Aaa by Moody’s and in compliance with SEC Rule 2(a)7, that are invested solely in one (1) or more securities of the United States government, securities issued by one (1) or more agencies of the United States government, repurchase agreements, reverse repurchase agreements, and individual corporate securities rated AAA by S&P or Aaa by Moody’s;

(c)Certificates of deposit, Eurodollar certificates of deposit, demand and time deposits, and prime bankers acceptances issued by any of the Lenders and any other financial institution organized and existing under the laws of the United States of America or any of its states or Canada and having on the date of the investment (i) an S&P rating of at least A- or A-1, (ii) a Moody’s rating of at least A-3 or P-1, or (iii) an equivalent rating from either Dominion Bond Rating Services Limited or CBRS, Inc., in each case due within one (1) year after the date of the making of the investment;

(d)Fully collateralized repurchase agreements with a financial institution described in clause (c) above having a defined termination date, fully secured by obligations of the United States government, or its agencies, and due within one (1) year after the date of the making of the investment;

(e)Tax-exempt mutual funds that invest in municipal securities rated Al or higher or AA or higher by S&P or P1 or higher or Aa or higher by Moody’s and in compliance with SEC Rule 2(a)7;

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(f)Variable-rate tax-exempt demand notes issued by municipalities and rated AA or higher by S&P or Aa or higher by Moody’s and due within one (1) year after the date of the making of the investment;

(g)(i) Commercial paper issued by corporations and rated (x) A2 or higher by S&P, (y) P2 or higher by Moody’s, or (z) an equivalent rating from either Dominion Bond Rating Services Limited or CBRS, Inc., and (ii) corporate debt obligations rated (x) BBB or higher by S&P, (y) Baal or higher by Moody’s, or (z) an equivalent rating from either Dominion Bond Rating Services Limited or CBRS, Inc. [So]so long as the instrument is rated (x) Al or higher or A- or higher by S&P, (y) P1 or higher or A3 or higher by Moody’s, or (z) an equivalent rating or higher from either Dominion Bond Rating Services Limited or CBRS, Inc., it must be due within one (1) year after the date of the making of the investment, otherwise it shall be due within ninety (90) days after the date of the making of the investment;

(h)Loan participations through a financial institution described in clause (c) above, provided the underlying corporate credit is rated A2 or higher by S&P and P2 or higher by Moody’s and provided such loan participations are limited in duration to overnight investments;

(i)Investments by any one or more Loan Parties (x) in other Loan Parties, and (y) so long as no Default or Event of Default exists or arises as a result thereof, in any other Subsidiary of the Parent so long as, in the case of this clause (y) such Investments (together with any Guarantees made pursuant to clause (d)(ii) of the definition of “Permitted Indebtedness” and any Investments made pursuant to clause (p) of this definition of “Permitted Investments”) shall not exceed an aggregate principal amount at any time outstanding equal to $150,000,000; provided that to the extent Investments are made pursuant to this clause (i)(y) in an aggregate principal amount in excess of $75,000,000, on a pro forma basis, after giving effect to any Investment under this clause (i)(y), either (A) the Total Outstandings shall not exceed more than 50% of the Line Cap, or (B) the Payment Conditions shall have been satisfied;

(j)Loans or advances to directors, officers, and employees of the Loan Parties that never exceed a total of $10,000,000 outstanding for all of the Loan Parties and to the extent not prohibited by the Sarbanes-Oxley Act of 2002;

(k)Indebtedness of customers created in any Loan Party’s ordinary course of business in a manner consistent with its present practices;

(l)Financial Hedges not for speculative purposes;

(m)Callable agency securities issued by government-sponsored entities and rated AAA by S&P or Aaa by Moody’s;

(n)Agency bullet securities issued by government-sponsored entities and rated AAA by S&P or Aaa by Moody’s;

(o)Permitted Acquisitions;

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(p)Other Investments (including the purchase of less than fifty percent (50%) of the Capital Stock of another Person), so long as such Investments (together with any Guarantees made pursuant to clause (d)(ii) of the definition of “Permitted Indebtedness” and any Investments made pursuant to clause (i)(y) of this definition of “Permitted Investments”) shall not exceed an aggregate principal amount at any time outstanding equal to $150,000,000; provided that to the extent Investments are made pursuant to this clause (p) in an aggregate principal amount in excess of $75,000,000, on a pro forma basis, after giving effect to any Investment under this clause (p), either (A) the Total Outstandings shall not exceed more than 50% of the Line Cap, or (B) the Payment Conditions shall have been satisfied;

(q)other Investments (including the purchase of less than 50% of the Capital Stock of another Person), so long as (1) (x) either (i) the Payment Conditions shall have been satisfied, or (ii)(A) no Default or Event of Default has occurred or shall occur after giving effect to such Investment, and (B) after giving pro forma effect to such Investment, Availability on the date of such Investment and for the sixty (60) days precedent such Investment shall be equal to or greater than twenty percent (20%) of the Line Cap (without giving effect to the Specified Reserves), and (y) the Borrower shall have provided a certification to the Administrative Agent, in form and substance reasonably satisfactory to the Administrative Agent, certifying as to the satisfaction of the conditions described in clauses (x)(i) or (ii), as applicable, or (2) the Covenant Conditions shall have been satisfied; and

(r)shares of any so-called “money market fund” advised, serviced or sold by any of the Lenders or by any other financial institution, provided that such fund (i) is registered under the Investment Company Act of 1940, (ii) has net assets of at least $250,000,000, (iii) has an investment portfolio with an average maturity of 365 days or less, and (iv) is not generally considered to be a “high-yield” fund.

Permitted Overadvance” means an Overadvance made by the Administrative Agent, in its reasonable discretion, which:

(a)Is made to maintain, protect or preserve the Collateral and/or the Credit Parties’ rights under the Loan Documents or which is otherwise for the benefit of the Credit Parties; and

(b)Together with all other Permitted Overadvances then outstanding, (i) shall not exceed five percent (5%) of the Borrowing Base and the FILO Borrowing Base, in the aggregate outstanding at any time or (ii) unless a liquidation of the ABL Priority Collateral is then occurring, remain outstanding for more than forty-five (45) consecutive Business Days, unless in each case the Required Lenders otherwise agree;

provided however, that the foregoing shall not (i) modify or abrogate any of the provisions of SECTION 2.13(h) regarding any Revolving Lender’s obligations with respect to Letter of Credit Disbursements, or (ii) result in any claim or liability against the Administrative Agent (regardless of the amount of any Overadvance) for “inadvertent Overadvances” (i.e. where an Overadvance results from changed circumstances beyond the control of the Administrative Agent (such as a

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reduction in the collateral value)), and such inadvertent Overadvances shall not reduce the amount of Permitted Overadvances allowed hereunder; and further provided that in no event shall the Administrative Agent make an Overadvance, if after giving effect thereto, the principal amount of the Revolving Credit Extensions would exceed the [Tetal]sum of the total Revolving Commitments (as in effect prior to any termination of the [Total]Revolving Commitments pursuant to SECTION 7.01).

“Permitted Prepayment” means any prepayment with the proceeds of Indebtedness so long as (i) unless otherwise waived by the Required Revolving Lenders, no Cash Dominion Event then exists, (ii) such Indebtedness is provided by an Eligible Assignee, and (ii) the aggregate principal amount of such Permitted Indebtedness shall be used to and shall not exceed the amount necessary to refinance the outstanding principal amount of the ABL Term Loan, together with any applicable Prepayment Premium, accrued but unpaid interest and fees and expenses owing in connection with the repayment of the ABL Term Loan and the incurrence of such new Indebtedness; provided that any Permitted Indebtedness incurred to refinance or replace the ABL Term Loan shall not have terms or conditions (other than interest rate, prepayment premium and fees/expenses payable thereunder) more favorable, taken as a whole, to the Persons providing such Permitted Indebtedness than the terms of the ABL Term Loan being so refinanced, or shall be otherwise on terms satisfactory to the Administrative Agent. The Lenders hereby agree that any Indebtedness meeting the requirements set forth in this definition shall constitute Permitted Indebtedness and the Borrower and the Administrative Agent, notwithstanding anything to the contrary in Section 9.02, shall be entitled to amend this Agreement and any other Loan Document to permit such Indebtedness to constitute “Obligations” hereunder and thereunder.

Person” means any natural person, corporation, limited liability company, unlimited liability company, trust, joint venture, association, company, partnership, limited partnership, Governmental Authority or other entity.

Plan” means any employee benefit plan within the meaning of Section 3(3) of ERISA (including a Pension Plan), maintained for employees of the Parent or any ERISA Affiliate or any such Plan to which the Parent or any ERISA Affiliate is required to contribute on behalf of any of its employees.

Pledge Agreement” means that certain pledge agreement (whether or not contained in the Security Agreement or a standalone document) dated as of April 30, 2014 by and among certain of the Loan Parties and the Collateral Agent.

PPSA” means the Personal Property Security Act of Ontario (or any successor statute) or similar legislation of any other Canadian jurisdiction, including, without limitation, the Civil Code of Quebec, the laws of which are required by such legislation to be applied in connection with the issue, perfection, enforcement, opposability, validity or effect of security interests.

Prepayment Event” means any of the following events:

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(a)Any sale, transfer or other disposition (including pursuant to a sale and leaseback transaction) of any ABL Priority Collateral, other than the sale of Inventory in the ordinary course of business and other than sales, transfers and other dispositions to other Loan Parties; or

(b)Any casualty or other insured damage to, or any taking under power of eminent domain or by condemnation or similar proceeding of, any ABL Priority Collateral, unless the proceeds therefrom are required to be paid to the holder of a Lien on such property or asset having priority over the Lien of the Collateral Agent.

Prime Rate” means for any day a fluctuating rate per annum equal to the highest of (a) the rate of interest in effect for such day as publicly announced from time to time by Bank of America as its “prime rate”; (b) the Federal Funds Effective Rate for such day, plus 0.50%; and (c) the LIBO Rate for a one month interest period as determined on such day, plus 1.00%. . The “prime rate” set forth in clause (a) above is a rate set by Bank of America based upon various factors including Bank of America’s costs and desired return, general economic conditions and other factors, and is used as a reference point for pricing some loans, which may be priced at, above, or below such announced rate. Any change in Bank of America’s prime rate, the Federal Funds Effective Rate or the LIBO Rate, respectively, shall take effect at the opening of business on the day specified in the public announcement of such change. Notwithstanding the foregoing or anything else herein to the contrary, the Prime Rate shall in no event be less than zero percent (0.0%)

Prime Rate Loan” means any Revolving Credit Loan or the outstanding portion of the FILO Loan bearing interest at a rate determined by reference to the Prime Rate, in accordance with the provisions of Article II.

pro forma basis” means, in respect of a Specified Transaction, that such Specified Transaction shall be deemed to have occurred as of the first day of the applicable period of measurement in connection with the determination of the Consolidated Fixed Charge Ratio.

Proceeds of Crime Act” means the Proceeds of Crime (Money Laundering) and Terrorist Financing Act (Canada), and any regulations promulgated thereunder, if any, as the same may be amended from time to time.

“Purchase Option Event” has the meaning provided in SECTION 9.02.

Qualified ECP Guarantor” means, at any time, each Loan Party with total assets exceeding $10,000,000 or that qualifies at such time as an “eligible contract participant” under the Commodity Exchange Act and can cause another Person to qualify as an “eligible contract participant” at such time under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

Real Estate” means all Leases and all land, together with the buildings, structures, parking areas, and other improvements thereon, now or hereafter owned by any Loan Party, including all easements, rights-of-way, and similar rights relating thereto and all leases, tenancies, and occupancies thereof.

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Recipient means any Agent, any Lender, the Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of any Loan Party hereunder.

Register” has the meaning provided in SECTION 9.04(c).

Regulation U” means Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

Regulation X” means Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

Release” has the meaning provided in Section 101(22) of CERCLA.

Release Date” means the date that the Liens held by the Collateral Agent, for the benefit of the Credit Parties, on the Term Priority Collateral is terminated and released, which shall occur only upon payment in full of the Term Loan Facility (other than payment in full through a refinancing, replacement, amendment, supplement, modification, extension, renewal, restatement, amendment and restatement or refunding thereof).

Reportable Event” means any of the events set forth in Section 4043(c) of ERISA, other than events for which the 30 -day notice period has been waived.

Reports” has the meaning provided in SECTION 8.13.

“Required ABL Term Lenders” means at a time ABL Term Lenders holding ABL Term Loans aggregating more than fifty percent (50%) of the aggregate, amount of the ABL Term Loans outstanding.

Required Lenders” means, at any time, Lenders (other than Defaulting Lenders) having Revolving Commitments and holding FILO Loans and ABL Term Loans aggregating more than fifty percent (50%) of the [Total]Revolving Commitments and the principal amount of the FILO Loans and ABL Term Loans outstanding or if the Revolving Commitments have been terminated, Lenders (other than Defaulting Lenders) whose percentage of the outstanding Credit Extensions (calculated assuming settlement and repayment of all Swingline Loans by the Lenders) aggregate not less than fifty percent (50%) of all such Credit Extensions.

“Required Revolving Lenders” means, at any time, Revolving Lenders (other than Defaulting Lenders) having Revolving Commitments aggregating more than fifty percent (50%) of the aggregate amount of Revolving Commitments have been terminated. Revolving Lender (other than Defaulting Lenders) whose percentage of the outstanding Revolving Credit Extensions (calculated assuming settlement and repayment of all Swingline Loans by the Revolving Lenders) aggregate not Jess than fifty percent (50%) of all such Revolving Credit Extensions.

Reserves” means all (if any) Inventory Reserves and Availability Reserves.

Responsible Officer” of any Person shall mean any executive officer or financial officer of such Person and any other officer or similar official thereof with responsibility for the administration of the obligations of such Person in respect of this Agreement.

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Restricted Payment means any dividend or other distribution (whether in cash, securities or other property) with respect to any class of Capital Stock of a Person, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any Capital Stock of a Person or any option, warrant or other right to acquire any Capital Stock of a Person; provided that “Restricted Payments” shall not include any dividends payable solely in Capital Stock of a Loan Party.

“Revolving and FILO Obligations” means (a) the due and punctual payment of (i) the principal of, and interest (including all interest that accrues after the commencement of any case or proceeding by or against any Loan Party under the Bankruptcy Code, the BIA, the WURA or the CCAA or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding) on the Revolving Credit Loans and the FILO Loan, as and when due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by the Loan Parties under this Agreement or any other Loan Document in respect of any Letter of Credit, when and as due, including payments in respect of reimbursement of disbursements, interest thereon and obligations, to provide cash collateral and (iii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise, of the Loan Parties, to the Credit Parties, (other than the ABL Term Loan Secured Parties) under this Agreement and the other Loan Documents, including, without limitation, for all such items, that accrue after the commencement of any case or proceeding by or against any Loan Party under the Bankruptcy Code, the BIA, the WURA or the CCAA or any state, federal or provincial bankruptcy, insolvency, receivership or similar law, whether or not allowed in such case or proceeding, (b) the due and punctual payment and performance of all the covenants, agreements, obligations and liabilities of each Loan Party under or pursuant to this Agreement and the other Loan Documents (other than those related to the ABL Term Loan), and (c) Other Liabilities.

“Revolving Borrowing” means (a) the incurrence of Revolving Credit Loans of a single Type, on a single date and having, in the case of LIBO Loans, a single Interest Period, or (b) a Swingline Loan.

“Revolving Commitment” means, with respect to each Revolving Lender, the aggregate commitment(s) of such Revolving Lender hereunder in the amount set forth opposite its name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased or reduced from time to time pursuant to this Agreement.

“Revolving Commitment Percentage” means with respect to each Revolving Lender, that percentage of the Revolving Commitments of all Revolving Lenders hereunder, in the amount set forth opposite such Revolving Lender’s name on Schedule 1.1 hereto or as may subsequently be set forth in the Register from time to time, as the same may be increased or reduced from time to time pursuant to this Agreement.

Revolving Credit Ceiling” means $350,000,000, as such amount may be increased or reduced in accordance with the terms of this Agreement.

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Revolving Credit Extensions” means each, of the following, (a) a Revolving Borrowing and (b) an L/C Credit Extension.

“Revolving Credit Loans” means all loans at any time made by any Revolving Lender pursuant to Article II and, to the extent applicable, shall include Swingline Loans made by the Swingline Lender pursuant to SECTION 2.06.

Revolving Credit Notes” means the promissory notes of the Borrower substantially in the form of Exhibit D, each payable to the order of a, Revolving Lender, evidencing the Revolving Credit Loans made to the Borrower.

“Revolving Lender” means, at any time, any Lender that has a Revolving Commitment at such time or, if the Revolving Commitments have terminated, Revolving Credit Extensions.

“Revolving Line Cap” means, at any time of determination, the lesser of (a) the aggregate amount of the Revolving Commitments or (b) the Borrowing Base.

“Revolving Purchase Date” has the meaning provided in SECTION 9.02.

“Revolving Purchase Notice” has the meaning provided in SECTION 9.02.

“Revolving Purchasing Creditors” has the meaning provided in SECTION 9.02.

S&P” means Standard & Poor’s Ratings Services, a division of The McGraw-Hill Companies, Inc. and any successor thereto.

Sanction(s)” means any international economic sanction administered or enforced by OFAC, the United Nations Security Council, the federal government of Canada, the European Union, Her Majesty’s Treasury or other relevant sanctions authority.

SEC” means the Securities and Exchange Commission.

Security Agreement” means the Amended and Restated Security Agreement dated as of April 30, 2014 among the Loan Parties and the Collateral Agent for its benefit and the benefit of the other Credit Parties.

Security Documents” means the Security Agreement, the General Security Agreement, the Deeds of Hypothec, the Facility Guarantee, the Facility Guarantors’ Collateral Documents, the Pledge Agreement, the Intellectual Property Security Agreement(s), the Confirmation Agreement, and each other security agreement or other instrument or document executed and delivered pursuant to this Agreement or any other Loan Document to secure any of the Obligations.

Settlement Date” has the meaning provided in SECTION 2.22(b).

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Solvent means, with respect to any Person on a particular date, that on such date (i) (a) at fair valuations, all of the properties and assets of such Person are greater than the sum of the debts, including contingent liabilities, of such Person, (b) the present fair saleable value of the properties and assets of such Person is not less than the amount that would be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person is able to realize upon its properties and assets and pay its debts and other liabilities, contingent obligations and other commitments as they mature in the normal course of business, (d) such Person does not intend to, and does not believe that it will, incur debts beyond such Person’s ability to pay as such debts mature, and (e) such Person is not engaged in a business or a transaction, and is not about to engage in a business or transaction, for which such Person’s properties and assets would constitute unreasonably small capital after giving due consideration to the prevailing practices in the industry in which such Person is engaged, and (ii) as to any Person incorporated or organized under the laws of Canada or any province or territory thereof, such Person is not an “insolvent person” as defined in the BIA.

Specified Default” means the occurrence of any Event of Default specified in SECTIONS 7.01(a), 7.01(b), 7.01(c), 7.01(d) (with respect to Article VI, SECTIONS 5.01(d), 5.08(b) or 5.11 only), 7.01(f) (but only to the extent such Material Indebtedness has been accelerated), 7.01(g), 7.01(h), 7.01(i), 7.01(j), 7.01(k), 7.01(n), 7.01(o), 7.01(p), 7.01(s), or SECTION 7.01(t). Each determination of whether a Specified Default has occurred and is continuing (solely as it relates to the definition of “Cash Dominion Event”, the definition of “ABL Term Default Rate,” SECTION 2.12, and SECTION 8.18) shall be made without giving effect to any waiver or modification of any such provision effected pursuant to the terms hereof without the consent of the ABL Term Loan Agent.

Specified Loan Party” means any Loan Party that is not then an “eligible contract participant” under the Commodity Exchange Act (determined prior to giving effect to SECTION 9.23).

“Specified Release Paragraph” has the meaning provided in SECTION 9.02.

“Specified Reserves” means, collectively, the FILO Reserve and the ABL Term Loan Reserve.

Specified Transaction” means any Permitted Acquisition, any Investment made pursuant to clause (q) of the definition of “Permitted Investment”, prepayment of Indebtedness pursuant to Section 6.06(b)(ii), and any Restricted Payment or other event that by the terms of this Agreement requires such test to be calculated on a “pro forma basis” or after giving “pro forma effect.”

Standby Letter of Credit” means any Letter of Credit other than a Commercial Letter of Credit.

Stated Amount” means at any time the maximum amount for which a Letter of Credit may be honored.

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Statutory Reserve Rate means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentages (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the [Board]FRB to which the Administrative Agent is subject with respect to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the [Board]FRB). Such reserve percentages shall include those imposed pursuant to such Regulation D. LIBO Rate Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation. The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

Subordinated Indebtedness” means Indebtedness which is expressly subordinated in right of payment to the prior payment in full of the Obligations and which is in form and on terms approved in writing by the Agents (for the avoidance of any doubt, the FILO Loan and the ABL Term Loan shall not constitute Subordinated Indebtedness).

Subsidiary” means with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s Consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity (a) of which Capital Stock representing more than fifty percent (50%) of the equity or more than fifty percent (50%) of the ordinary voting power or, in the case of a partnership, more than fifty percent (50%) of the general partnership interests are, as of such date, owned, Controlled or held, or (b) except with respect to any financial statements or calculations in accordance with GAAP, that is, as of such date, otherwise Controlled, by the parent or one or more subsidiaries of the parent or by the parent and one or more subsidiaries of the parent.

Swap Obligations” means, with respect to any Loan Party, any obligation to pay or perform under any agreement, contract or transaction that constitutes a “swap” within the meaning of Section 1 a(47) of the Commodity Exchange Act.

Swingline Lender” means Bank of America, N.A., in its capacity as lender of Swingline Loans hereunder.

Swingline Loan” means a, Revolving Credit Loan made by the Swingline Lender to the Borrower, pursuant to SECTION 2.06 hereof.

Swingline Loan Ceiling” means, at any time, ten percent (10%) of the [Total]Revolving Commitments. As of the Effective Date, the Swingline Loan Ceiling is $35,000,000.

Swingline Note” means the promissory note of the Borrower substantially in the form of Exhibit E, payable to the order of the applicable Swingline Lender, evidencing the Swingline Loans made by the Swingline Lender to the Borrower.

Synthetic Lease” means any lease or other agreement for the use or possession of property creating obligations which do not appear as Indebtedness on the balance sheet of the lessee thereunder but which, upon the insolvency or bankruptcy of such Person, may be characterized as Indebtedness of such lessee without regard to the accounting treatment.

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Taxes means all present or future taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

Term Agent” means Bank of America, N.A., in its capacity as administrative agent and collateral agent under the Term Loan Agreement or any successor agent thereto.

Term Loan Agreement” means that certain Term Loan Agreement dated as of April 30, 2014 by and among, inter alios, the Borrower, the Term Agent and the lenders from time to time party thereto, as the same may be amended, restated, amended and restated, supplemented, refinanced, replaced, extended, renewed or otherwise modified from time to time in accordance with the terms hereof and of the Intercreditor Agreement.

Term Loan Documents” means the Term Loan Agreement and the other “Loan Documents” (as defined in the Term Loan Agreement).

Term Loan Facility” means the credit facility pursuant to the Term Loan Agreement and one or more debt facilities or other financing arrangements (including, without limitation indentures) providing for term loans or other long-term Indebtedness that replace or refinance such credit facility, including any such replacement or refinancing facility or indenture that increases or decreases the amount permitted to be borrowed thereunder or alters the maturity thereof and whether by the same or any other agent, lender or group of lenders, and any amendments, supplements, modifications, extensions, renewals, restatements, amendments and restatements or refundings thereof or any such indentures or credit facilities that replace or refinance such credit facility, in each case, which is in compliance with any restrictions contained in the Intercreditor Agreement or any other intercreditor agreement in form and substance reasonably satisfactory to the Administrative Agent with respect thereto.

Term Loan Maturity Reserve” means during any Term Loan Reserve Period, an amount equal to the then outstanding principal balance of the Term Loan Facility outstanding on the date which is ninety-one (91) days prior to the maturity date of such Indebtedness, which Term Loan Maturity Reserve shall remain in place (but shall be reduced to give effect to any payments of the Term Loan Facility made during such Term Loan Reserve Period (including any payments made with the proceeds of Loans hereunder) to the extent such payments are permitted hereunder) until the earlier of the repayment of such Indebtedness (including as a result of refinancing of such Indebtedness so long as the term of such refinancing Indebtedness (any such refinancing Indebtedness, the “Refinancing Term Loan Debt”) is at least ninety-one (91) days) or the extension of the maturity date of such Indebtedness to a date which is at least ninety-one (91) days after the then maturity date of such Indebtedness.

Term Loan Reserve Period” means the period beginning on the 91st day prior to the maturity date of the Term Loan Facility and in each case ending on the date of the repayment in full of such Indebtedness. If and to the extent that such Indebtedness is repaid by virtue of any Refinancing Term Loan Debt, a subsequent Term Loan Maturity Reserve shall be imposed in an amount equal to the outstanding principal balance of such Refinancing Term Loan Debt from and after the date that is ninety-one (91) days prior to the maturity date of such Refinancing Term Loan Debt.

Term Priority Collateral” has the meaning provided for such term in the Intercreditor Agreement.

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Termination Date means (a) with respect to the Revolving and FILO Obligations, the earliest to occur of (i) the Maturity Date, (ii) the date on which the maturity of the Revolving and FILO Obligations is accelerated and the [Total]Revolving Commitments are irrevocably terminated, (iii) the date of the occurrence of any Event of Default pursuant to SECTION 7.01(h) or 7.01(i), or (iv) the termination of the [Total]Revolving Commitments in accordance with the provisions of SECTION [2.15] [ Total Commitments means, at any time, the sum of the Commitments at such time. As of the Effective Date, the Total Commitments aggregate $350,000,000.]2.15 and (b) with respect to the ABL Term Obligations the earliest to occur of (i) the Maturity Date, or (ii) the date on which the maturity of the ABL Term Obligations is accelerated (or deemed accelerated) in accordance with Article VII.

Total Outstandings” means the aggregate outstanding principal amount of all Loans and all Letter of Credit Outstandings.

Trust Funds” means any cash comprised of (i) funds specifically and exclusively used for payroll Taxes, payroll and other employee benefit payments to or for the benefit of any Loan Party’s or its Subsidiaries’ employees, (ii) all Taxes required to be collected, remitted or withheld (including, without limitation, federal and state withholding taxes (including the employer’s share thereof) and (iii) any other funds (A) which any Loan Party holds on behalf of another Person and (B) which such Loan Party holds as an escrow or fiduciary for such Person.

Trust Funds DDA” has the meaning provided in SECTION 2.18(h).

Type