Exhibit 10.1

Execution Version

 

This AMENDMENT NO. 2, dated as of October 25, 2017  (including Annex A attached hereto, this “Amendment”), among TAILORED BRANDS, INC., a Texas corporation (“Parent”), THE MEN’S WEARHOUSE, INC., a Texas corporation (the “Company” or the “Lead Borrower”), each of the other U.S. Subsidiary Borrowers party hereto (together with Parent and the Company, the “U.S. Borrowers”), MOORES THE SUIT PEOPLE INC., a corporation organized under the laws of New Brunswick (the “Canadian Borrower” and together with the U.S. Borrowers, the “Borrowers”), JPMORGAN CHASE BANK, N.A., as Administrative Agent, and JPMORGAN CHASE BANK, N.A. TORONTO BRANCH, as Canadian Administrative Agent, amends that certain Credit Agreement dated as of June 18, 2014, among the Borrowers, the Administrative Agent, the Canadian Administrative Agent and the lenders from time to time party thereto (as amended by the Joinder Agreement dated as of June 18, 2014, Amendment No. 1 dated as of July 28, 2014, the Joinder Agreement effective as of January 31, 2016, and the Joinder Agreement dated as of June 30, 2016, the “Credit Agreement”).

W I T N E S S E T H:

WHEREAS, the Borrowers, the lenders party hereto (the “Lenders”), the Administrative Agent and the Canadian Administrative Agent have agreed to further amend the Credit Agreement on the terms set forth herein;

NOW, THEREFORE, in consideration of the premises set forth herein, and for other good and valuable consideration, the sufficiency and receipt of which is hereby acknowledged, the parties hereby agree as follows:

SECTION 1.       Amendments to the Credit Agreement.

(a) The Credit Agreement is hereby amended as set forth in Annex A to insert the language marked as underscored and delete the language marked as strikethrough (the Credit Agreement as so amended, the “Amended Credit Agreement”).  Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to them in the Amended Credit Agreement.

(b) On the Amendment No. 2 Effective Date (as defined below), each Lender party hereto shall have the Revolving Commitment set forth opposite its name in Schedule I hereof.

SECTION 2.       Conditions.  This Amendment and the obligations of the Lenders to make Loans and of the Issuing Banks to issue Letters of Credit under the Amended Credit Agreement shall not become effective until the date (such date being referred to as the “Amendment No. 2 Effective Date”) on which each of the following conditions is satisfied (or waived in accordance with Section 9.02 of the Credit Agreement) to the satisfaction of the Administrative Agent:

(a)        Amendment No. 2.  The Administrative Agent (or its counsel) shall have received from each of the Borrowers, each Lender listed on Schedule I hereto, the Administrative Agents, the Issuing Banks and the Swing Line Lenders either (i) a counterpart of this Amendment signed on behalf of such party or (ii) evidence satisfactory to the Administrative Agent (which may include PDF or electronic transmission of a signed signature page of this Agreement) that such party has signed a counterpart of this Amendment.

(b)        Opinions.  The Administrative Agent shall have received a favorable written opinion (addressed to the Administrative Agent, the Canadian Administrative Agent and the Lenders and dated the Amendment No. 2 Effective Date) of (i) Vorys, Sater, Seymour & Pease LLP, counsel for the Loan Parties (with respect to matters of Delaware, Massachusetts, New York and Texas law), (ii) Stewart McKelvey, Canadian counsel for the Loan Parties with respect


 

to matters of New Brunswick law,  and (iii)  Berliner Cohen LLP,  California counsel for the Loan Parties, in each case, in form and substance reasonably satisfactory to the Applicable Administrative Agent.

(c)        Organization and Good Standing Documents.  The Administrative Agent shall have received such documents and certificates as the Administrative Agent may reasonably request relating to the organization, existence and good standing (or equivalent) of each Loan Party as of a recent date prior to or as of the Amendment No. 2 Effective Date, the authorization of Amendment No. 2 and transactions to be consummated on the Amendment No. 2 Effective Dateand any other legal matters relating to the Loan Parties, the Loan Documents or the Transactions, all in form and substance reasonably satisfactory to the Administrative Agent.

(d)        Representations and Warranties.  The representations and warranties of the Loan Parties set forth in the Loan Documents shall be true and correct (i) in the case of representations and warranties qualified as to materiality, in all respects and (ii) otherwise, in all material respects, in each case on and as of the Amendment No. 2 Effective Date, except in the case of any such representation and warranty that expressly relates to a prior date, in which case such representation and warranty shall be so true and correct on and as of such prior date.

(e)        Officer’s Certificate.  The Administrative Agent shall have received a certificate, dated the Amendment No. 2 Effective Date and signed by the Chief Financial Officer of Parent, certifying as to compliance with the conditions set forth in paragraph (d) of this Section and that, before and after giving effect to Amendment No. 2, (i) the Borrowers are in compliance with the Collateral and Guarantee Requirement,  (ii) the Borrowers are in compliance with the Revolving Exposure Limitations and (iii) no Default exists.

(f)        Solvency Certificate.  The Administrative Agent shall have received a certificate, dated the Amendment No. 2 Effective Date and signed by the Chief Financial Officer of Parent, as to the solvency of the Loan Parties on a consolidated basis after giving effect to Amendment No. 2 and transactions to be consummated on the Amendment No. 2 Effective Date, in the form of Exhibit J to the Credit Agreement.

(g)        Collateral and Guarantee Requirement.  The Borrowers shall be in compliance with the Collateral and Guarantee Requirement.  The Administrative Agent shall have received a completed Perfection Certificate Supplement, dated the Amendment No. 2 Effective Date and signed by an executive officer or a Financial Officer of Parent, together with all attachments contemplated thereby, including the results of a search of the UCC filings and PPSA financing statements (or equivalent) made with respect to the Loan Parties in the jurisdictions contemplated by the Perfection Certificate Supplement and copies of the financing statements (or similar documents) disclosed by such search and evidence reasonably satisfactory to the Administrative Agent that the Liens indicated by such financing statements (or similar documents) are permitted under Section 6.02 of the Credit Agreement.

(h)        Loan Reallocation.  The Administrative Agent shall be satisfied with the arrangements to ensure that immediately after the Amendment No. 2 Effective Date all outstanding Revolving Loans will be held on a pro rata basis by the Lenders based on their respective Revolving Commitments set forth in Schedule I to this Amendment.

(i)         Payment of Fees and Expenses.  The Administrative Agent shall have received (i) upfront fees, for the account of each Lender in the amounts separately agreed between JPMCB and Parent, and (ii) all fees and other amounts due and payable on or prior to the Amendment No.

-2-


 

2 Effective Date, including, to the extent invoiced, payment or reimbursement of all fees and expenses (including fees, charges and disbursements of counsel) required to be paid or reimbursed by any Loan Party under the Engagement Letter dated October 3, 2017, between JPMCB and Parent, the fee letter dated October 3, 2017, between JPMCB and Parent, or any Loan Document.

(j)         Know Your Customer Information.  The Lenders shall have received all documentation and other information required by bank regulatory authorities under applicable “know your customer” and anti-money laundering rules and regulations, including the USA Patriot Act, at least five Business Days prior to the Amendment No. 2 Effective Date to the extent such information was requested at least 10 Business Days prior to the Amendment No. 2 Effective Date.

The Administrative Agent shall notify the Borrowers and the Lenders of the Amendment No. 2 Effective Date, and such notice shall be conclusive and binding.

 

SECTION 3.       Use of Proceeds.  The Letters of Credit and proceeds of the Loans will be used for general corporate purposes and working capital needs of the Borrowers (including for Investments and Capital Expenditures) subject to the restrictions otherwise set forth in the Credit Agreement.

SECTION 4.       Representations and Warranties.  The representations and warranties of the Loan Parties set forth in Article III of the Amended Credit Agreement are incorporated herein by reference.

SECTION 5.       Reaffirmation of Collateral Documents; Reaffirmation of Intercompany Subordination Agreement.

(a)        Each of the U.S. Borrowers (i) without limiting its obligations under, or the provisions of, the U.S Security Agreement, hereby confirms its respective assignments, pledges and grants of security interests, as applicable, under the U.S. Security Agreement and each of the other Collateral Documents to which it is party, (ii) without limiting its obligations under, or the provisions of, any Collateral Document, hereby confirms that the obligations of the Borrowers under the Credit Agreement are entitled to the benefits of the security interests set forth or created in the U.S. Security Agreement and the other Collateral Documents and constitute “Obligations,” “Secured Obligations” or other similar term for purposes thereof, (iii) hereby agrees that, after giving effect to Amendment No. 2 and any transactions contemplated to be consummated on the Amendment No. 2 Effective Date, such pledges and grants of security interests, as applicable, shall continue to be in full force and effect and shall continue to inure to the benefit of the Lenders, the Issuing Banks and the other Secured Parties under the U.S. Security Agreement, and, to the extent it is the issuer of certificated shares of stock or certificated membership interests, as applicable, that are pledged to the Administrative Agent under and pursuant to the U.S. Security Agreement, in its capacity as issuer thereof, hereby consents to and ratifies such pledge, (iv) hereby ratifies, confirms and agrees that all Liens granted, conveyed, or assigned to the Administrative Agent by such Person pursuant to any Collateral Document to which it is a party remain in full force and effect, are not released or reduced, and after giving effect to Amendment No. 2 and any transactions contemplated to be consummated on the Amendment No. 2 Effective Date, continue to secure full payment and performance of the Obligations under the  Amended Credit Agreement and such Liens continue unimpaired with the same priority to secure repayment of such Obligations whether heretofore or hereafter incurred and no new filings are required to be made and no other action is required to be taken to perfect or to maintain the perfection of such Liens, (v) without limiting its obligations under, or the provisions of, the Intercompany Subordination Agreement, hereby

-3-


 

ratifies, confirms and agrees that all of its obligations under the Intercompany Subordination Agreement shall continue in full force and effect for the benefit of the Administrative Agents, and (vi) nothing in this Amendment shall be construed as a substitution or novation of the Obligations or any instruments securing the same or of any other obligations under any Collateral Document.  Each of the U.S. Borrowers further agrees to take any action that may be required or that is requested by the Administrative Agent to ensure compliance by the Loan Parties with the provisions of Section 5.15 of the Amended Credit Agreement and hereby reaffirms its obligations under each similar provision of each Collateral Document to which it is a party.

(b)        Each of the Canadian Loan Parties (i) without limiting its obligations under, or the provisions of, the Canadian Security Agreements, hereby confirms its respective assignments, pledges and grants of security interests, as applicable, under the Canadian Security Agreements and each of the other Collateral Documents to which it is party, (ii) without limiting its obligations under, or the provisions of, any Loan Document, hereby confirms that the obligations of the Canadian Loan Parties under the Credit Agreement are entitled to the benefits of the security interests set forth or created in the Canadian Security Agreements and the other Collateral Documents and constitute “Canadian Obligations,” “Canadian Secured Obligations” or other similar term for purposes thereof, (iii) hereby agrees that, after giving effect to Amendment No. 2 and any transactions contemplated to be consummated on the Amendment No. 2 Effective Date, such pledges and grants of security interests, as applicable, shall continue to be in full force and effect and shall continue to inure to the benefit of the Canadian Lenders, the Canadian Issuing Banks and the other Secured Parties under the Canadian Security Agreements, (iv) hereby ratifies, confirms and agrees that all Liens granted, conveyed, or assigned to the Canadian Administrative Agent by such Person pursuant to any Collateral Document to which it is a party remain in full force and effect, are not released or reduced, and after giving effect to Amendment No. 2 and any transactions contemplated to be consummated on the Amendment No. 2 Effective Date, continue to secure full payment and performance of the Canadian Obligations under the Amended Credit Agreement, and such Liens continue unimpaired with the same priority to secure repayment of such Canadian Obligations whether heretofore or hereafter incurred and no new filings are required to be made and no other action is required to be taken to perfect or to maintain the perfection of such Liens, (v) without limiting its obligations under, or the provisions of, the Intercompany Subordination Agreement, hereby ratifies, confirms and agrees that all of its obligations under the Intercompany Subordination Agreement shall continue in full force and effect for the benefit of the Administrative Agents, and (vi) nothing in this Amendment shall be construed as a substitution or novation of the Canadian Obligations or any instruments securing the same or of any other obligations under any Collateral Document.  Each of the Canadian Loan Parties further agrees to take any action that may be required or that is requested by the Canadian Administrative Agent to ensure compliance by the Canadian Loan Parties with the provisions of Section 5.15 of the Amended Credit Agreement and hereby reaffirms its obligations under each similar provision of each Collateral Document to which it is a party.

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SECTION 6.       No other amendments; No novation.  Except as hereby amended, the terms and provisions of the Credit Agreement shall remain in full force and effect.  The parties acknowledge and agree that this Amendment is not and shall not be construed as a novation of the Credit Agreement as in effect prior to the Amendment No. 2 Effective Date, or of any other Loan Document.  Without limiting the foregoing, this Amendment shall not by implication or otherwise limit, impair, constitute a waiver of or otherwise affect the rights and remedies of the Lenders, the Issuing Banks, the other Lender Parties, the Administrative Agent, the Canadian Administrative Agent or the other Secured Parties under any Collateral Document or under the Intercreditor Agreement and shall not alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Collateral Documents or the Intercreditor Agreement, all of which are ratified and affirmed in all respects and remain in full force and effect.

SECTION 7.       Lender Acknowledgment of Intercreditor Agreement.  The Lenders and the Issuing Banks acknowledge that the obligations of the Lead Borrower under the Term Credit Agreement are secured by Liens on assets of the U.S. Borrowers that constitute Collateral and that the relative Lien priority and other creditor rights of the Lender Parties hereunder and the secured parties under the Term Credit Agreement are set forth in the Intercreditor Agreement.  Each Lender and Issuing Bank hereby acknowledges that it has received a copy of the Intercreditor Agreement.  Each Lender and Issuing Bank hereby irrevocably (a) consents to the subordination of the Liens on the Term Priority Collateral securing the Secured Obligations on the terms set forth in the Intercreditor Agreement, (b) agrees that such Lender or Issuing Bank is bound by the provisions of the Intercreditor Agreement as if it were a signatory thereto and will take no actions contrary to the provisions of the Intercreditor Agreement and (c) agrees that no Lender or Issuing Bank shall have any right of action whatsoever against the Administrative Agent as a result of any action taken by the Administrative Agent in accordance with the terms of the Intercreditor Agreement.  Each Lender and Issuing Bank hereby further irrevocably authorizes and directs the Administrative Agent (i) to take such actions as shall be required to release Liens on the Collateral in accordance with the terms of the Intercreditor Agreement and (ii) to enter into such amendments, supplements or other modifications to the Intercreditor Agreement in connection with any extension, renewal, refinancing or replacement of any Secured Obligations or the Term Credit Agreement as are reasonably acceptable to the Administrative Agent to give effect thereto, in each case on behalf of such Lender or Issuing Bank and without any further consent, authorization or other action by such Lender or Issuing Bank.  The Administrative Agent shall have the benefit of the provisions of Article VIII of the Credit Agreement with respect to all actions taken by it in accordance with the terms of the Intercreditor Agreement to the full extent thereof.  The secured parties under the Term Credit Agreement are intended third party beneficiaries of this provision.

SECTION 8.       Counterparts.  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.  Delivery of an executed counterpart of a signature page of this Agreement by electronic transmission or other electronic imaging shall be effective as delivery of a manually executed counterpart of this Agreement.

SECTION 9.       Applicable Law.  THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, BUT GIVING EFFECT TO FEDERAL LAWS APPLICABLE TO NATIONAL BANKS.

[Signature pages follow]

 

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective authorized officers as of the day and year first above written.

 

 

 

 

TAILORED BRANDS, INC.,

 

as Parent and a U.S. Borrower

 

 

 

 

 

 

 

By:

/s/ Jack P. Calandra

 

Name:

Jack P. Calandra

 

Title:

Executive Vice President, Treasurer and Chief

 

 

Financial Officer

 

 

 

 

THE MEN’S WEARHOUSE, INC.,

 

as the Company, a U.S. Subsidiary Borrower and the

 

Borrower Representative

 

 

 

 

 

 

 

By:

/s/ Jack P. Calandra

 

Name:

Jack P. Calandra

 

Title:

Executive Vice President, Treasurer and Chief

 

 

Financial Officer

 

 

 

 

 

 

TWIN HILL ACQUISITION COMPANY, INC.

 

RENWICK TECHNOLOGIES, INC.

 

TMW MERCHANTS LLC

 

MWDC HOLDING INC.

 

MWDC TEXAS INC.

 

K&G MEN’S COMPANY INC.

 

JA APPAREL CORP.

 

NASHAWENA MILLS CORP.

 

JOSEPH ABBOUD MANUFACTURING CORP.

 

JOS. A. BANK CLOTHIERS, INC.

 

THE JOSEPH A. BANK MFG. CO., INC.

 

TS SERVICING CO., LLC

 

TAILORED SHARED SERVICES, LLC

 

TAILORED BRANDS PURCHASING LLC

 

TAILORED BRANDS GIFT CARD CO LLC,

 

each as a U.S. Subsidiary Borrower

 

 

 

 

 

 

 

By:

/s/ Jack P. Calandra

 

Name:

Jack P. Calandra

 

Title:

Executive Vice President, Treasurer and Chief

 

 

Financial Officer

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

 

 

 

 

MOORES THE SUIT PEOPLE INC.,

 

as the Canadian Borrower

 

 

 

 

 

 

 

By:

/s/ Jack P. Calandra

 

Name:

Jack P. Calandra

 

Title:

Executive Vice President, Treasurer and Chief

 

 

Financial Officer

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

 

 

 

 

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

 

 

 

 

 

 

By:

/s/ Christy L. West

 

 

Name:    Christy L. West

 

 

Title:      Authorized Officer

 

 

 

 

 

 

 

JPMORGAN CHASE BANK, N.A., TORONTO

 

BRANCH, as Canadian Administrative Agent

 

 

 

 

 

 

 

By:

/s/ Auggie Marchetti

 

 

Name:    Auggie Marchetti

 

 

Title:      Authorized Officer

 

 

 

 

 

 

 

JPMORGAN CHASE BANK, N.A., as a U.S.

 

Revolving Lender, a U.S. Issuing Bank and the U.S.

 

Swingline Lender

 

 

 

 

 

 

 

By:

/s/ Christy L. West

 

 

Name:    Christy L. West

 

 

Title:      Authorized Officer

 

 

 

 

 

 

 

JPMORGAN CHASE BANK, N.A., TORONTO

 

BRANCH, as a Canadian Revolving Lender, a Canadian

 

Issuing Bank and the Canadian Swingline Lender

 

 

 

 

 

 

 

By:

/s/ Auggie Marchetti

 

 

Name:    Auggie Marchetti

 

 

Title:      Authorized Officer

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

LENDER SIGNATURE PAGE

 

 

 

 

 

Bank of America, N.A.

 

as a U.S. Revolving Lender

 

 

 

 

By:

/s/ Andrew Cerussi

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

Andrew Cerussi

 

 

 

 

Title:

Director

 

 

 

 

 

 

 

If a second signatory is necessary:

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

Bank of America, N.A. (acting through its Canada Branch)

 

as a Canadian Revolving Lender

 

 

 

 

 

 

 

By:

/s/ Sylwia Durkiewicz

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

Sylwia Durkiewicz

 

 

 

 

Title:

Vice President

 

 

 

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

 

 

 

 

If a second signatory is necessary:

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

LENDER SIGNATURE PAGE

 

 

 

 

 

Wells Fargo Bank, N.A.

 

as a U.S. Revolving Lender

 

 

 

 

 

 

 

By:

/s/ Robert C. Cakarian

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

Robert C. Cakarian

 

 

 

 

Title:

Vice President

 

 

 

 

 

 

 

If a second signatory is necessary:

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

Wells Fargo Capital Finance Corporation Canada

 

as a Canadian Revolving Lender

 

 

 

 

 

 

 

By:

/s/ Trevor Tysick

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

Trevor Tysick

 

 

 

 

Title:

Vice President

 

 

 

 

 

 

 

If a second signatory is necessary:

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

LENDER SIGNATURE PAGE

 

 

 

 

 

U.S. Bank National Association

 

as a U.S. Revolving Lender

 

 

 

 

 

 

 

By:

/s/ Robert Don

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

Robert Don

 

 

 

 

Title:

Assistant Vice President

 

 

 

 

 

 

 

If a second signatory is necessary:

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

U.S. Bank National Association

 

as a Canadian Revolving Lender

 

 

 

 

 

 

 

By:

/s/ John P. Rehob

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

John P. Rehob

 

 

 

 

Title:

Vice President & Principal Officer

 

 

 

 

 

 

 

If a second signatory is necessary:

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

LENDER SIGNATURE PAGE

 

 

 

 

 

Fifth Third Bank,

 

as a U.S. Revolving Lender

 

 

 

 

 

 

 

By:

/s/ Kristina M. Miller

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

Kristina M. Miller

 

 

 

 

Title:

Senior Vice President

 

 

 

 

 

 

 

If a second signatory is necessary:

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

Fifth Third Bank, Operating through its Canadian Branch,

 

as a Canadian Revolving Lender

 

 

 

 

 

 

 

By:

/s/ Neil Ghai

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

Neil Ghai

 

 

 

 

Title:

Vice President

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

 

 

 

 

If a second signatory is necessary:

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

LENDER SIGNATURE PAGE

 

 

 

 

 

Regions Bank,

 

as a U.S. Revolving Lender

 

 

 

 

 

 

 

By:

/s/ Connie Ruan

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

Connie Ruan

 

 

 

 

Title:

Director

 

 

 

 

 

 

 

If a second signatory is necessary:

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

 

 

 

 

 

 

Regions Bank

 

as a Canadian Revolving Lender

 

 

 

 

 

 

 

By:

/s/ Connie Ruan

 

 

 

 

 

 

 

 

 

 

 

 

 

Name:

Connie Ruan

 

 

 

 

Title:

Director

 

 

 

 

 

 

 

If a second signatory is necessary:

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

 

 

 

 

By:

 

 

 

 

 

 

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

[Signature Page - Amendment No. 2 to ABL Credit Agreement]


 

Schedule I

 

Revolving Commitments

(as of the Amendment No. 2 Effective Date)

 

 

 

 

 

Revolving Lenders

U.S.
Commitment

Canadian
Commitment

JPMorgan Chase Bank, N.A.

113,636,363.64 

-- 

JPMorgan Chase Bank, N.A., Toronto Branch

-- 

11,363,636.36 

Bank of America, N.A.

113,636,363.64 

-- 

Bank of America, N.A. (acting through its Canada Branch)

-- 

11,363,636.36 

Wells Fargo Bank, N.A.

113,636,363.64 

-- 

Wells Fargo Capital Finance Corporation Canada

-- 

11,363,636.36 

U.S. Bank, National Association

63,636,363.63 

-- 

U.S. Bank, National Association - Canada Branch

-- 

6,363,636.37 

Fifth Third Bank

63,636,363.63 

-- 

Fifth Third Bank, Operating through its Canadian Branch

-- 

6,363,636.37 

Regions Bank

31,818,181.82 

3,181,818.18 

Total   

$500,000,000.00 

$50,000,000.00 

 

 

 

 


 

ANNEX A

Insertions pursuant to Amendment No. 2 are shown as underscored

Deletions pursuant to Amendment No. 2 are shown as strikethrough

 

 

 

 

 

CREDIT AGREEMENT1

 

dated as of

 

June 18, 2014

 

among

 

TAILORED BRANDS, INC.,

as a U.S. Borrower,

 

THE MEN’S WEARHOUSE, INC.,

 

as the Company The

 

as a U.S. Subsidiary Borrower and the Borrower Representative,

 

 

 

the other Domestic Subsidiaries from time to time party hereto,

 

as U.S. Subsidiary Borrowers,

 

 

 

MOORES THE SUIT PEOPLE INC.,

 

as Canadian BorrowerThe,

 

 

 

the other LOAN PARTIESLoan Parties from time to time party hereto,

 

The LENDERS

 

the Lenders from time to time party hereto,

 

 

JPMORGAN CHASE BANK, N.A.,

 

 


1   Conformed to reflect Joinder Agreement dated as of June 18, 2014, Amendment No. 1 to Credit Agreement dated as of July 28, 2014, Joinder Agreement effective as of January 31, 2016, Joinder Agreement dated as of June 30, 2016, and Amendment No.2 dated as of October 25, 2017.


 

 

as Administrative Agent,

 

and

 

JPMORGAN CHASE BANK, N.A. TORONTO BRANCH,

as Canadian Administrative Agent

J.P. MORGAN SECURITIES LLC andCHASE BANK, N.A.,

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED, and

WELLS FARGO BANK, N.A.

as Joint Bookrunners and Joint Lead Arrangers

 

BANK OF AMERICA, N.A.,  and

 

as Syndication Agent

 

U.S. BANK NATIONAL ASSOCIATION,

 

UNION BANK, N.A.

 

WELLS FARGO BANK, N.A.

 

as Co-Syndication Agents

 

U.S. BANK, NATIONAL ASSOCIATION and

FIFTH THIRD BANK

as Co-Documentation Agents

 

 

 

-ii-


 

TABLE OF CONTENTS

 

 

 

 

 

Page

 

 

 

 

ARTICLE I

 

 

 

 

 

Definitions

 

 

 

 

SECTION 1.01

Defined Terms

1

SECTION 1.02

Classification of Loans and Borrowings

5557

SECTION 1.03

Terms Generally

5557

SECTION 1.04

Accounting Terms; GAAP

5557

SECTION 1.05

Currency Matters

5658

SECTION 1.06

Classification of Actions

5658

 

ARTICLE II

 

 

 

 

 

The Credits

 

 

 

 

SECTION 2.01

Commitments

5659

SECTION 2.02

Loans and Borrowings

5759

SECTION 2.03

Requests for Revolving Borrowings

5860

SECTION 2.04

Protective Advances

5961

SECTION 2.05

Swingline Loans and Overadvances

6062

SECTION 2.06

Letters of Credit

6264

SECTION 2.07

Funding of Borrowings

6770

SECTION 2.08

Interest Elections

6870

SECTION 2.09

Termination and Reduction of Revolving Commitments; Increase in Revolving Commitments

7072

SECTION 2.10

Repayment of Loans; Evidence of Debt

7173

SECTION 2.11

Prepayment of Loans

7274

SECTION 2.12

Fees

7375

SECTION 2.13

Interest

7476

SECTION 2.14

Alternate Rate of Interest 76; Illegality

78

SECTION 2.15

Increased Costs.

7679

SECTION 2.16

Break Funding Payments

7780

SECTION 2.17

Taxes

7881

SECTION 2.18

Payments Generally; Allocation of Proceeds; Sharing of Set-offs

8184

SECTION 2.19

Mitigation Obligations:  Replacement of Lenders

8487

SECTION 2.20

Defaulting Lenders

8488

SECTION 2.21

Returned Payments

8690

 

 

 

 

ARTICLE III

 

 

 

 

 

Representations and Warranties

 

 

 

 

SECTION 3.01

Organization; Powers

8690

SECTION 3.02

Authorization; Enforceability; Benefit to Loan Parties

8790

SECTION 3.03

Governmental Approvals; No Conflicts

8790

SECTION 3.04

Financial Condition; No Material Adverse Effect

8791

SECTION 3.05

Properties

8891

 

-i-


 

 

 

 

SECTION 3.06

Litigation and Environmental Matters

8892

SECTION 3.07

Compliance with Laws and Agreements

8992

SECTION 3.08

Investment Company Status 89, etc

92

SECTION 3.09

Taxes

8992

SECTION 3.10

ERISA; Labor Matters; Canadian Pension Plans and Canadian Benefit Plans

9093

SECTION 3.11

Disclosure

9194

SECTION 3.12

Subsidiaries and Joint Ventures

9194

SECTION 3.13

Insurance

9194

SECTION 3.14

Federal Reserve Regulations

9195

SECTION 3.15

Solvency

9195

SECTION 3.16

Collateral Matters

9295

SECTION 3.17

Use of Proceeds

9296

SECTION 3.18

Credit Card Agreements

9296

 

 

 

 

ARTICLE IV

 

 

 

 

 

Conditions

 

SECTION 4.01

Effective Date

9396

SECTION 4.02

Each Credit Event

9598

 

 

 

 

ARTICLE V

 

 

 

 

 

Affirmative Covenants

 

 

 

 

SECTION 5.01

Financial Statements:  Borrowing Base and Other Information

9599

SECTION 5.02

Notices of Material Events

99103

SECTION 5.03

Additional Subsidiaries

100103

SECTION 5.04

Information Regarding Collateral

100104

SECTION 5.05

Existence; Conduct of Business

101104

SECTION 5.06

Payment of Obligations

101104

SECTION 5.07

Maintenance of Properties

101104

SECTION 5.08

Insurance

101105

SECTION 5.09

Books and Records; Inspection Rights

102105

SECTION 5.10

Compliance with Laws

102105

SECTION 5.11

Use of Proceeds

102106

SECTION 5.12

Appraisals

103106

SECTION 5.13

Field Examinations

103106

SECTION 5.14

Depository Banks; Withdrawals from Borrowing Base Deposit Accounts

103106

SECTION 5.15

Further Assurances

104107

SECTION 5.16

Credit Card Agreements and Notifications

104107

SECTION 5.17

Designation of Subsidiaries

104107

SECTION 5.18

Deposit Accounts

104108

SECTION 5.19

Post-Closing Requirements

104108

 

-ii-


 

 

 

 

 

ARTICLE VI

 

 

 

 

 

Negative Covenants

 

 

 

 

SECTION 6.01

Indebtedness; Certain Equity Securities

105108

SECTION 6.02

Liens

107110

SECTION 6.03

Fundamental Changes; Business Activities

108111

SECTION 6.04

Investments, Loans, Advances, Guarantees and Acquisitions

108112

SECTION 6.05

Asset Sales

110113

SECTION 6.06

Sale/Leaseback Transactions

111115

SECTION 6.07

Swap Agreements

111115

SECTION 6.08

Restricted Payments; Certain Payments of Indebtedness

111115

SECTION 6.09

Transactions with Affiliates

113116

SECTION 6.10

Restrictive Agreements

113116

SECTION 6.11

Amendment of Organizational Documents

113117

SECTION 6.12

Fixed Charge Coverage Ratio

114117

SECTION 6.13

Changes in Fiscal Periods

114117

SECTION 6.14

Canadian Pension Plans

114117

 

ARTICLE VII

 

 

 

 

 

Events of Default

 

 

 

 

 

ARTICLE VIII

 

 

 

 

 

The Administrative Agents

 

 

 

 

 

ARTICLE IX

 

 

 

 

 

Miscellaneous

 

 

 

 

SECTION 9.01

Notices

121125

SECTION 9.02

Waivers; Amendments

123127

SECTION 9.03

Expenses; Indemnity; Damage Waiver

125129

SECTION 9.04

Successors and Assigns

127131

SECTION 9.05

Survival

130134

SECTION 9.06

Counterparts; Integration; Effectiveness

131135

SECTION 9.07

Severability

131135

SECTION 9.08

Right of Setoff

131135

SECTION 9.09

Governing Law:  Jurisdiction; Consent to Service of Process

132135

SECTION 9.10

WAIVER OF JURY TRIAL

132136

SECTION 9.11

Headings

133136

SECTION 9.12

Confidentiality

133137

SECTION 9.13

Several Obligations; Nonreliance; Violation of Law

134138

SECTION 9.14

USA PATRIOT Act

134138

SECTION 9.15

Appointment for Perfection

134138

SECTION 9.16

Interest Rate Limitation

134138

SECTION 9.17

No Fiduciary Relationship

135138

SECTION 9.18

Intercreditor Agreement

135139

SECTION 9.19

Lender Loss Sharing Agreement.

136139

SECTION 9.20

Anti-Money Laundering Legislation

138141

 

-iii-


 

 

 

 

 

SECTION 9.21

Judgment Currency

138142

SECTION 9.22

Waiver of Immunity

139142

SECTION 9.23

Process Agent

139143

SECTION 9.24

Acknowledgement and Consent to Bail-In of EEA Financial Institutions

143

 

 

 

 

ARTICLE X

 

 

 

 

 

U.S. Loan Guarantee

 

 

 

 

SECTION 10.01

Guarantee

139143

SECTION 10.02

Guarantee of Payment

140144

SECTION 10.03

No Discharge or Diminishment of U.S. Guarantee

140144

SECTION 10.04

Defenses Waived

140145

SECTION 10.05

Rights of Subrogation

141145

SECTION 10.06

Reinstatement; Stay of Acceleration

141145

SECTION 10.07

Information

141145

SECTION 10.08

Taxes

141146

SECTION 10.09

Maximum U.S. Liability

141146

SECTION 10.10

Contribution

142146

SECTION 10.11

Liability Cumulative

142146

 

 

 

 

ARTICLE XI

 

 

 

 

 

Canadian Loan Guaranty

 

 

 

 

SECTION 11.01

Guarantee

142147

SECTION 11.02

Guarantee of Payment

143147

SECTION 11.03

No Discharge or Diminishment of Canadian Guarantee

143147

SECTION 11.04

Defenses Waived

144148

SECTION 11.05

Rights of Subrogation

144149

SECTION 11.06

Reinstatement; Stay of Acceleration

144149

SECTION 11.07

Information

145149

SECTION 11.08

[Reserved]

145149

SECTION 11.09

[Reserved]

145149

SECTION 11.10

Maximum Canadian Liability

145149

SECTION 11.11

Contribution

145150

SECTION 11.12

Liability Cumulative

146150

 

 

 

 

ARTICLE XII

 

 

 

 

 

The Borrower Representative

 

 

 

 

SECTION 12.01

Appointment; Nature of Relationship

146150

SECTION 12.02

Powers

146151

SECTION 12.03

Employment of Agents

147151

SECTION 12.04

Notices

147151

SECTION 12.05

Successor Borrower Representative

147151

SECTION 12.06

Execution of Loan Documents; Borrowing Base Certificate

147151

SECTION 12.07

Reporting

147151

 

-iv-


 

SCHEDULES:

Schedule 2.01

Commitments (as of the Effective Date)

 

 

 

 

 

 

EXHIBITS:

 

 

 

 

 

Exhibit A

Form of Assignment and Assumption

Exhibit B

Form of Borrowing Base Certificate

Exhibit C

Form of Borrowing Request

Exhibit D

Form of Compliance Certificate

Exhibit E

Form of Intercreditor Agreement[Reserved]

Exhibit F

Form of Interest Election Request

Exhibit G

Form of Supplemental Perfection Certificate

Exhibit H

Form of Joinder Agreement

Exhibit I-1

Form of U.S. Tax Certificate for Non-U.S. Lenders that are not Partnerships for U.S. Federal Income Tax Purposes

Exhibit I-2

Form of U.S. Tax Certificate for Non-U.S. Lenders that are Partnerships for U.S. Federal Income Tax Purposes

Exhibit I-3

Form of U.S. Tax Certificate for Non-U.S. Participants that are not Partnerships for U.S. Federal Income Tax Purposes

Exhibit I-4

Form of U.S. Tax Certificate for Non-U.S. Participants that are Partnerships for U.S. Federal Income Tax Purposes

Exhibit J

Form of Solvency Certificate

 

 

-v-


 

CREDIT AGREEMENT, dated as of June 18, 2014, among TAILORED BRANDS, INC., a Texas corporation, THE MEN’S WEARHOUSE, INC., a Texas corporation (the “Company”), each of the other U.S. Subsidiary Borrowers from time to time party hereto, MOORES THE SUIT PEOPLE INC., a corporation organized under the laws of New Brunswick (the “Canadian Borrower” and, together with the U.S. Borrowers, the “Borrowers”), the Canadian Guarantors from time to time party hereto, the Lenders from time to time party hereto, JPMORGAN CHASE BANK, N.A., as Administrative Agent, and JPMORGAN CHASE BANK, N.A. TORONTO BRANCH, as Canadian Administrative Agent, as amended by the Joinder Agreement dated as of June 18, 2014, Amendment No. 1 (as defined below), the Joinder Agreement effective as of January 31, 2016, and the Joinder Agreement dated as of June 30, 2016.2016, and Amendment No.2 (as defined below).

R E C I T A L S:

WHEREAS, the Lenders have agreed to extend certain credit facilities to the Borrowers consisting of $500,000,000550,000,000 in an aggregate principal amount of Revolving Commitments.

NOW, THEREFORE, the parties hereto hereby agree as follows:

ARTICLE I

 

Definitions

SECTION 1.01       Defined Terms.  As used in this Agreement, the following terms have the meanings specified below:

ABR,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, bears interest at a rate determined by reference to the Alternate Base Rate.

Account” has the meaning set forth in the applicable Security Agreement.

Account Debtor” means any Person obligated on an Account.

Acquired Company” means Jos. A. Bank Clothiers, Inc., a Delaware corporation.

Acquired Company Acquisition Agreement Representations” means the representations and warranties made by the Acquired Company in the Acquisition Agreement, but only to the extent that Parent or Merger Sub has the right under the Acquisition Agreement not to consummate the Acquisition Tender Offer or the Merger as a result of such representations and warranties in the Acquisition Agreement being inaccurate.

Acquisition” means the Acquisition Tender Offer and the Merger, collectively.

Acquisition Agreement” means the Agreement and Plan of Merger, dated as of March 11, 2014, among Parent, Merger Sub and the Acquired Company, together with the exhibits thereto and the related disclosure letter.

Acquisition Tender Offer” means the offer to purchase for cash all the outstanding shares of common stock in the Acquired Company by Merger Sub pursuant to the Acquisition Agreement.

 


 

Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period or for any ABR Borrowing, an interest rate per annum (rounded upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

Administrative Agent” means JPMCB, in its capacity as administrative agent hereunder and under the other Loan Documents, and its successors in such capacity as provided in Article VIII.

Administrative Agents” means the Administrative Agent and the Canadian Administrative Agent.

 “Administrative Questionnaire” means an Administrative Questionnaire in a form supplied by the Administrative Agent.

Agents” means, individually and collectively as the context may require, the Administrative Agent, the Canadian Administrative Agent, the Arrangers, the Co-Syndication AgentAgents and the Co-Documentation Agents.

Affiliate” means, with respect to a specified Person, another Person that directly or indirectly Controls or is Controlled by or is under common Control with the Person specified.

Aggregate Borrowing Base” means (i) the U.S. Borrowing Base plus (ii) the lesser of (x) the Canadian Commitments and (y) the Canadian Borrowing Base.

Agreement” means this Credit Agreement, as modified, amended or restated from time to time.

Alternate Base Rate” means, for any day, a rate per annum equal to the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds EffectiveNYFRB Rate in effect on such day plus 1/2½ of 1% per annum and (c) the Adjusted LIBO Rate for a one month Interest Period on such day (or if such day is not a Business Day, the immediately preceding Business Day) for a deposit in dollars with a maturity of one month plus 1% per annum;, provided that, for the avoidancepurpose of doubtthis definition, the Adjusted LIBO Rate for any day shall be based on the LIBO Screen Rate (or if the LIBO Screen Rate is not available for such one month Interest Period, the Interpolated Rate) at approximately 11:00 a.m., London time, on such day.  Any change in the Alternate Base Rate due to a change in the Prime Rate, the Federal Funds EffectiveNYFRB Rate or the Adjusted LIBO Rate shall be effective from and including the effective date of such change in the Prime Rate, the Federal Funds EffectiveNYFRB Rate or the Adjusted LIBO Rate, respectively.  If the Alternate Base Rate is being used as an alternate rate of interest pursuant to Section 2.14 hereof, then the Alternate Base Rate shall be the greater of clause (a) and (b) above and shall be determined without reference to clause (c) above.

Amendment No. 1” means Amendment No. 1 dated as of July 28, 2014, to the Original Credit Agreement among the Administrative Agent, the Canadian Administrative Agent and the Borrowers party thereto.

“Amendment No. 2” means Amendment No. 2 dated as of October 25, 2017, to the Original Credit Agreement among the Administrative Agent, the Canadian Administrative Agent, the Borrowers party thereto and the Lenders party thereto.

“Amendment No. 2 Effective Date” means the date on which the conditions precedent in Section 2 of Amendment No. 2 are satisfied.

AML Legislation” has the meaning set forth in Section 9.20.

-2-


 

Anti-Corruption Laws” means all laws, rules and regulations of any jurisdiction applicable to the Borrowers or their respective Affiliates from time to time concerning or relating to bribery or corruption.

Applicable Administrative Agent” means (a) with respect to the Canadian Facility and Canadian Letters of Credit, the Canadian Administrative Agent and (b) otherwise, the Administrative Agent.

applicable Borrower(s)” or “applicable Loan Parties” means (i) with respect to any Loan to the Canadian Borrower, Letter of Credit issued for the account of the Canadian Borrower or other amounts directly attributable to the Canadian Loan Parties, the Canadian Borrower or the Canadian Loan Parties, respectively and (ii) with respect to any other amount required to be paid hereunder, the U.S. Borrowers, jointly and severally.

Applicable Commitment Fee Rate” means (i) until the end of the first full fiscal quarter of Parent commencing after the Effective Date, 0.375% per annum and (ii) thereafter (x) if the average daily Revolving Exposure for the most recently ended fiscal quarter of Parent was less than 50% of the aggregate average daily Revolving Commitments for such Fiscal Quarter, 0.375% per annum and (y) if subclause (x) does not apply, 0.25% per annum.

Applicable Percentage” means, for any Revolving Lender:

(a)        with respect to payments, computations and other matters relating to the U.S. Commitments or U.S. Revolving Loans, U.S. LC Exposure, U.S. Protective Advances, U.S. Overadvances or U.S. Swingline Loans, a percentage equal to a fraction (i) the numerator of which is the U.S. Commitment of such Revolving Lender and (ii) the denominator of which is the aggregate U.S. Commitments of all the U.S. Revolving Lenders (or, if the aggregate U.S. Commitments have terminated or expired, the Applicable Percentage shall be determined based upon such Revolving Lender’s share of the aggregate U.S. Revolving Exposure);

(b)        with respect to payments, computations and other matters relating to the Canadian Commitment or Canadian Revolving Loans, Canadian LC Exposure, Canadian Protective Advances or Canadian Overadvances, a percentage equal to a fraction (i) the numerator of which is the Canadian Commitment of such Revolving Lender and (ii) the denominator of which is the aggregate Canadian Commitments of all the Canadian Revolving Lenders (or, if the aggregate Canadian Commitments have terminated or expired, the Applicable Percentage shall be determined based upon such Revolving Lender’s share of the aggregate Canadian Revolving Exposure); and

(c)        with respect to payments, computations and other matters relating to the Revolving Commitments generally, a percentage equal to a fraction, the numerator of which is (i) the aggregate Revolving Commitment of such Revolving Lender and (ii) the denominator of which is the aggregate Revolving Commitments of all the Revolving Lenders (or, if the aggregate Revolving Commitments have terminated or expired, the Applicable Percentage shall be determined based upon such Revolving Lender’s share of the aggregate Revolving Exposure);

provided that for purposes of Section 2.20 when a Defaulting Lender shall exist, any such Defaulting Lender’s Revolving Commitments shall be disregarded in the calculations set forth above.

Applicable Rate” means, for any day, with respect to any Loan, as the case may be, the applicable rate per annum set forth in the pricing grid below under the caption “Adjusted LIBO Rate/CDOR Rate Loans” or “ABR/Canadian Prime Rate Loans,” as the case may be, based upon the daily average Availability for the most recent fiscal quarter of Parent (the “Average Availability”):

 

-3-


 

 

 

 

 

LEVEL

AVERAGE
AVAILABILITY

EURODOLLARADJU
STED LIBO
RATE/CDOR RATE
LOANS

ABR/ CANADIAN
PRIME RATE
LOANS

I

> 66.666% of the Line Cap

1.501.25%

0.500.25%

II

≤ 66.666% of the Line Cap but
≥  33.333% of the Line Cap

1.751.50%

0.750.50%

III

< 33.333% of the Line Cap

2.001.75%

1.000.75%

 

For purposes of the foregoing, the Applicable Rate shall be determined (a) from and after the Amendment No. 2 Effective Date and until any change thereto pursuant to clause (b) below, by reference to Category III in the table above and (b) as of the end of each fiscal quarter of Parent beginning with the first full fiscal quarter commencing after the Amendment No. 2 Effective Date, based upon the Borrowing Base Certificate that is delivered from time to time pursuant to Section 5.01(h) as of the last day of such fiscal quarter, with any changes to the Applicable Rate resulting from a change in Average Availability to be effective on the first day of the first month following delivery of such Borrowing Base Certificate.  Notwithstanding the foregoing provisions of this definition, if the Borrowers shall fail to deliver any Borrowing Base Certificate as of the last day of any fiscal quarter of Parent by the time required under Section 5.01(h), then the Applicable Rate shall be determined by reference to Category III in the table above from and including the day next following the date on which such Borrowing Base Certificate shall have been due to but excluding the sixth day after the date on which such Borrowing Base Certificate shall have been delivered.

Applicable Share” has the meaning set forth in Section 10.10.

Approved Fund” means any Person (other than a natural person) that is engaged in making, purchasing, holding or investing in commercial loans and similar extensions of credit in the ordinary course of its activities and that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

Arrangers” means, (i) with respect to the Original Credit Agreement, J.P. Morgan Securities, LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated, and (ii) with respect to Amendment No. 2, JPMCB, Merrill Lynch, Pierce, Fenner & Smith Incorporated,  and Wells Fargo Bank, N.A., in each case in their capacities as joint bookrunners and joint lead arrangers for the credit facility established hereby.

Assignment and Assumption” means an assignment and assumption entered into by a Lender and an Eligible Assignee, with the consent of any Person 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.

Availability” means, at any time, an amount equal to (a) the Line Cap at such time minus (b) the total Credit Exposure of all Lenders at such time.

-4-


 

Availability Period” means the period from and including the Effective Date to but excluding the earlier of the Maturity Date and the date of termination of the aggregate Revolving Commitments.

Average Availability” has the meaning set forth in the definition of “Applicable Rate.”

“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.

Banking Services” means each and any of the following bank services provided to any Loan Party or any Subsidiary by any Lender or any of its Affiliates:  (a) credit cards for commercial customers (including, without limitation, “commercial credit cards” and purchasing cards), (b) treasury management services (including, without limitation, controlled disbursement, automated clearinghouse transactions, return items, overdrafts and interstate depository network services) and (c) supply chain financing.

Banking Services Obligations” means any and all obligations of the Loan Parties, whether absolute or contingent and howsoever and whensoever created, arising, evidenced or acquired (including all renewals, extensions and modifications thereof and substitutions therefor), in connection with Banking Services.

Banking Services Reserves” means all Reserves that the Administrative Agent from time to time establishes in its Permitted Discretion for Banking Services then provided or Banking Services Obligations then outstanding.

Bankruptcy Code” means title 11 of the United States Code, as amended.

“Bankruptcy Event” means, with respect to any Person, such Person becomes the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business appointed for it (including any corporate law or other law permitting a Person to obtain a stay of proceedings or compromise of claims of its creditors against it), or, in the good faith determination of the Administrative Agent, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment, provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof, unless such ownership interest results in or provides such Person with immunity from the jurisdiction of courts within the United States or Canada or from the enforcement of judgments or writs of attachment on its assets or permit such Person (or such Governmental Authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person.

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

Borrower” or “Borrowers” means, individually or collectively, the U.S. Borrowers and the Canadian Borrower.

Borrower Representative” has the meaning set forth in Section 12.01.

-5-


 

Borrowing” means (a) Revolving Loans under the same Facility of the same Type and currency, made, converted or continued on the same date and, in the case of Eurodollar Loans or CDOR Rate Loans, as to which a single Interest Period is in effect, (b) a Swingline Loan, (c) a Protective Advance or (d) an Overadvance.

Borrowing Base” means, individually and collectively as the context may require, the U.S. Borrowing Base and the Canadian Borrowing Base.

Borrowing Base Certificate” means a certificate, signed and certified as accurate and complete by a Financial Officer of the Borrower Representative, in substantially the form of Exhibit B (with such changes thereto as may be required by the Administrative Agent in its Permitted Discretion from time to time to reflect the components of and reserves against the Borrowing Base as provided for hereunder) or another form that is acceptable to the Administrative Agent in its Permitted Discretion.

Borrowing Base Reporting Date” means the last day of each fiscal month of Parent; provided that during any Weekly Reporting Period, the last day of each week will also be a Borrowing Base Reporting Date.

Borrowing Request” means a request by the Borrower Representative for a Borrowing of Revolving Loans in accordance with Section 2.03, which shall be, in the case of any such written request, in the form of Exhibit C or any other form approved by the Administrative Agent.

Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by law to remain closed; provided that (a) when used in connection with any Eurodollar 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 and (b) when used in connection with any Canadian Loan or any Canadian Letter of Credit, the term “Business Day” shall also exclude any day on which commercial banks in Toronto, Canada are authorized or required by law to remain closed.

CAM” has the meaning set forth in Section 9.19.

CAM Exchange” has the meaning set forth in Section 9.19.

CAM Exchange Date” has the meaning set forth in Section 9.19.

CAM Percentage” has the meaning set forth in Section 9.19.

Canada” means the country of Canada and any province or territory thereof.

Canadian Administrative Agent” means JPMorgan Chase Bank, N.A. Toronto Branch, in its capacity as administrative agent for the Canadian Revolving Lenders hereunder, and its successors and assigns in such capacity.

Canadian Benefit Plan” means any material plan, fund, program, or policy, whether oral or written, formal or informal, funded or unfunded, insured or uninsured, providing employee benefits, including medical, hospital care, dental, sickness, accident, disability, life insurance, pension, retirement or savings benefits, under which any Loan Party or any Subsidiary of any Loan Party has any liability with respect to any employee or former employee, but excluding any Canadian Pension Plans and excluding any stock option or share purchase plan.

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Canadian Blocked Person” means any Person that is a “politically exposed foreign person” or “terrorist group” or similar person whose property or interests in property are blocked or subject to blocking pursuant to, or as described in, any Canadian Economic Sanctions and Export Control Laws.

Canadian Borrower” has the meaning set forth in the introductory paragraph of this Agreement.

Canadian Borrower Outstandings” means, at any time, the sum of (i) the Dollar AmountEquivalent of the Canadian Revolving Loans and Canadian Swingline Loans to the Canadian Borrower outstanding at such time plus (ii) the Canadian LC Exposure in respect of Letters of Credit issued for the account of the Canadian Borrower at such time plus (iii) the Dollar AmountEquivalent of the Canadian Protective Advances to the Canadian Borrower outstanding at such time.

Canadian Borrowing Base” means, at any time (without duplication):

(a)        the lesser of (x) the product of (i) 90% multiplied by (ii) the Net Orderly Liquidation Value of Eligible Inventory of the Canadian Loan Parties at such time and (y) the net book value of Eligible Inventory of the Canadian Loan Parties, plus

(b)        the lesser of (i) the product of (A) 85% multiplied by (B) the Net Orderly Liquidation Value of Eligible Tuxedo Rental Inventory of the Canadian Loan Parties and (ii) the net book value of Eligible Tuxedo Rental Inventory of the Canadian Loan Parties; provided that in no event shall the amount included pursuant to this clause (b) exceed 20% of the Canadian Borrowing Base, plus

(c)        the product of (i) 85% multiplied by (ii) the Eligible Accounts of the Canadian Loan Parties at such time, plus

(d)        the product of (i) 90% multiplied by (ii) the Eligible Credit Card Accounts Receivable of the Canadian Loan Parties at such time, plus

(e)        the product of (i) 100% multiplied by (ii) the Dollar Equivalent of the cash and Cash Equivalents balances in Dollars of the Canadian Loan Parties held in a Deposit Account with the Administrative Agent subject to a blocked account control agreement in form and substance reasonably satisfactory to the Administrative Agent over which the Administrative Agent has sole dominion (the “Canadian Borrowing Base Deposit Account”), minus

(f)        without duplication, Reserves established by the Administrative Agent in its Permitted Discretion.

The Administrative Agent may, in its Permitted Discretion and with no less than four (4) Business Days’ prior written notice to the Borrower Representative (other than during a Dominion Period in which case notice shall not be required), adjust Reserves.  Subject to the immediately preceding sentence and the other provisions hereof expressly permitting the Administrative Agent to adjust Reserves, the Canadian Borrowing Base at any time shall be determined by reference to the most recent Borrowing Base Certificate delivered to the Administrative Agent pursuant to Section 5.01(h) (or, prior to the first such delivery, delivered to the Administrative Agent pursuant to Section 4.01(o)); provided that if any Borrowing Base Certificate delivered under Section 5.01(h) shall prove to have been materially inaccurate (regardless of whether any Revolving Commitments are in effect or any amounts are outstanding hereunder when such inaccuracy is discovered), and such inaccuracy shall have resulted in the payment of any interest or fees at rates lower than those that were in fact applicable for any period (based on the actual Canadian Borrowing Base), the applicable Borrowers shall pay to the Applicable Administrative

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Agent, for distribution to the Lenders (or former Lenders) as their interests may appear, the accrued interest or fees that should have been paid but were not paid as a result of such inaccuracy.

Notwithstanding the foregoing, to the extent the Administrative Agent has not completed a field examination of, and has not received an Inventory appraisal for, any Canadian Loan Party (or any Subsidiary of the Acquired Company that the Administrative Agent is satisfied will become a Canadian Loan Party on the Effective Date) prior to the Effective Date (any such entity an “Affected Canadian Entity”), assets of such Affected Canadian Entity that would otherwise be eligible for inclusion in the Canadian Borrowing Base shall not be subject to the advance rates set forth above until such field examination and appraisal are completed but instead the Canadian Borrowing Base shall be calculated separately for the Canadian Loan Parties that are not Affected Canadian Entities and then shall be increased by an amount equal to the sum of (i) 50% of the book value of Inventory of each Affected Canadian Entity so long as the Administrative Agent has a perfected first priority security interest in such Inventory (or, in the case of any Subsidiary of the Acquired Company, so long as the Administrative Agent is satisfied that the Administrative Agent will obtain a security interest in such Inventory on the Effective Date), (ii) 70% of the Accounts of such Affected Canadian Entity so long as the Administrative Agent has a perfected first priority security interest in such Accounts (or, in the case of any Subsidiary of the Acquired Company, so long as the Administrative Agent is satisfied that the Administrative Agent will obtain a security interest in such Accounts  on the Effective Date) and (iii) 70% of the face amount of Credit Card Accounts Receivable of such Affected Canadian Entity so long as the Administrative Agent has a perfected first priority security interest in such Credit Card Accounts Receivable (or, in the case of any Subsidiary of the Acquired Company, so long as the Administrative Agent is satisfied that the Administrative Agent will obtain a security interest in such Credit Card Accounts Receivable on the Effective Date) for up to 60 days less (iv) such Reserves as the Administrative Agent may establish in its Permitted Discretion;  provided that if the field examination and Inventory appraisal with respect to each Affected Canadian Entity have not been completed by the 60th day after the Effective Date, the Canadian Borrowing Base shall thereafter not include any amount in respect of the assets of any Affected Canadian Entity until such field examination and Inventory appraisal are completed.

Canadian Collateral” means any and all property of any Canadian Loan Party covered by the Collateral Documents and any and all other property of any Canadian Loan Party, now existing or hereafter acquired, that may at any time be or become subject to a security interest or Lien in favor of the Administrative Agent to secure the Canadian Secured Obligations.

Canadian Commitment” means, with respect to each Canadian Revolving Lender, the commitment, if any, of such Canadian Revolving Lender to make Canadian Revolving Loans and to acquire participations in Canadian Letters of Credit and Canadian Swingline Loans hereunder, expressed as an amount representing the maximum possible aggregate amount of such Canadian Revolving Lender’s Canadian Revolving Exposure hereunder, as such commitment may be reduced or increased from time to time pursuant to (a) Section 2.09 and (b) assignments by or to such Canadian Revolving Lender pursuant to Section 9.04.  The initial amount of each Canadian Revolving Lender’s Canadian Commitment is set forth on the Schedule 2.01,I to Amendment No. 2, or in the Assignment and Assumption pursuant to which such Canadian Revolving Lender shall have assumed its Canadian Commitment, as applicable.  TheAs of the Amendment No. 2 Effective Date, the aggregate initial amount of the Canadian Commitments is $100,000,000.50,000,000.

Canadian Credit Exposure” means, as to any Canadian Revolving Lender at any time, the sum of (a) such Canadian Revolving Lender’s Canadian Revolving Exposure plus (b) a Dollar AmountEquivalent equal to such Lender’s Applicable Percentage of the aggregate amount of Canadian Overadvances and Canadian Protective Advances outstanding.

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Canadian Defined Benefit Plan” means a Canadian Pension Plan, which contains a “defined benefit provision,” as defined in subsection 147.1(1) of the ITA.

Canadian Dollars” and “Cdn.$” means dollars in the lawful currency of Canada.

Canadian Economic Sanctions and Export Control Laws” means any Canadian laws, regulations or orders governing transactions in controlled goods or technologies or dealings with countries, entities, organizations, or individuals subject to economic sanctions and similar measures.

Canadian Facility” means, collectively, the Canadian Commitments and the extensions of credit made thereunder.

Canadian Guarantee” means Article XI of this Agreement.

Canadian Guaranteed Obligation” has the meaning assigned to such term in Section 11.01.

Canadian Guarantor” means each Subsidiary of the Canadian Borrower that is listed on the signature pages hereto as a Canadian Guarantor or that becomes a party hereto as a Canadian Guarantor pursuant to Section 5.03, in each case, until such Subsidiary’s Canadian Guarantee is released in accordance herewith.

Canadian Issuing Banks” means, individually and collectively as the context may require, in the case of each Canadian Letter of Credit, JPMorgan Chase Bank, N.A. Toronto Branch and any other Lender proposed by the Borrower Representative that has agreed to act as a Canadian Issuing Bank and is reasonably acceptable to the Canadian Administrative Agent, each in its capacity as an issuer of Canadian Letters of Credit hereunder, and its successors and assigns in such capacity as provided in Section 2.06(i).  Each Canadian Issuing Bank may, in its sole discretion, arrange for one or more Canadian Letters of Credit to be issued by Affiliates of such Canadian Issuing Bank, in which case the term “Canadian Issuing Bank” shall include any such Affiliate with respect to Canadian Letters of Credit issued by such Affiliate.

Canadian LC Collateral Account” has the meaning set forth in Section 2.06(j).

Canadian LC Exposure” means, at any time, the sum of the Commercial LC Exposure and the Standby LC Exposure, in each case, in respect of Canadian Letters of Credit.  The Canadian LC Exposure of any Canadian Revolving Lender at any time shall be its Applicable Percentage of the total Canadian LC Exposure at such time.

Canadian Letter of Credit” means any Letter of Credit issued under the Canadian Facility.

Canadian Loan Parties” means, individually and collectively as the context may require, the Canadian Borrower and each Canadian Guarantor.

Canadian Loans” means, individually and collectively as the context may require, the Canadian Revolving Loans, the Canadian Swingline Loans, the Canadian Protective Advances and the Canadian Overadvances.

Canadian Obligated Party” has the meaning set forth in Section 11.02.

Canadian Obligations” means all unpaid principal of and accrued and unpaid interest on the Canadian Loans to the Canadian Borrower, all accrued and unpaid fees and all expenses, reimbursements

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(including pursuant to Section 2.06(a)), indemnities and other obligations of the Canadian Loan Parties to the Lenders or to any Lender, the Administrative Agent, the Canadian Administrative Agent, any Canadian Issuing Bank or any indemnified party arising under the Loan Documents (including interest, costs, fees and other amounts accruing during the pendency of any proceeding under any Insolvency Laws, regardless of whether allowed or allowable in such proceeding).

Canadian Overadvance” has the meaning set forth in Section 2.05(b).

Canadian Overadvance Exposure” means, at any time, the sum of the aggregate principal amount of all outstanding Canadian Overadvances at such time.  The Canadian Overadvance Exposure of any Lender at any time shall be its Applicable Percentage of the total Canadian Overadvance Exposure at such time.

Canadian Pension Plans” means any plan, program or arrangement that is a pension plan that is required to be registered under any applicable Canadian federal or provincial pension legislation, whether or not registered under any such laws, which is, or has been, maintained or contributed to by, or to which there is or may be an obligation to contribute by, a Loan Party or Subsidiary operating in Canada in respect of any Person's employment in Canada with such Loan Party or Subsidiary, other than Plans established by statute, including the Canada Pension Plan maintained by the government of Canada and the Quebec Pension Plan maintained by the Province of Quebec.

Canadian Prime Rate” means on any day, the greater of (a) the annual rate of interest announced from time to time by the Canadian Administrative Agent as being its reference rate then in effect for determining interest rates on Canadian Dollar-denominated commercial loans made by it in Canada and which it refers to as its prime rate (or its equivalent or analogous rate) and (b) the yearly rate of interest to which the CDOR Rate for a one-month term in effect from time to time is equivalent plus 1.00% per annum., for any period, the rate per annum determined by the Canadian Administrative Agent to be the higher of (i) the rate equal to the PRIMCAN Index rate that appears on the Bloomberg screen at 10:15 a.m. Toronto time on such day (or, in the event that the PRIMCAN Index is not published by Bloomberg, any other information services that publishes such index from time to time, as selected by the Canadian Administrative Agent in its reasonable discretion) and (ii) the average rate for 30 day Canadian Dollar bankers’ acceptances that appears on the Reuters Screen CDOR Page (or, in the event such rate does not appear on such page or screen, on any successor or substitute page or screen that displays such rate, or on the appropriate page of such other information service that publishes such rate from time to time, as selected by the Canadian Administrative Agent in its reasonable discretion) at 10:15 a.m. Toronto time on such day, plus 1.00% per annum.  Any change in the Canadian Prime Rate due to a change in the PRIMCAN Index or the CDOR Rate shall be effective from and including the effective date of such change in the PRIMCAN Index or CDOR Rate, respectively.

Canadian Prime Rate Loan” means a Loan denominated in Canadian Dollars the rate of interest applicable to which is based upon the Canadian Prime Rate.

Canadian Protective Advance” has the meaning set forth in Section 2.04(a).

Canadian Protective Advance Exposure” means, at any time, the sum of the aggregate principal amount of all outstanding Canadian Protective Advances at such time.  The Canadian Protective Advance Exposure of any Lender at any time shall be its Applicable Percentage of the total Canadian Protective Advance Exposure at such time.

Canadian Revolving Exposure” means, with respect to any Canadian Revolving Lender at any time, the sum of (a) the outstanding principal amount of Canadian Revolving Loans of such Canadian

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Revolving Lender at such time plus (b) an amount equal to such Canadian Revolving Lender’s Canadian Swingline Exposure plus (c) an amount equal to such Canadian Revolving Lender’s Canadian LC Exposure at such time.

Canadian Revolving Lenders” means the Persons listed on Schedule 2.01I to Amendment No. 2 (or an Affiliate or branch of any such Person that is acting on behalf of such Person, in which case the term “Canadian Revolving Lenders” shall include any such Affiliate or branch with respect to the Canadian Revolving Loans made by such Affiliate or branch) as having a Canadian Commitment and any other Person that shall acquire a Canadian Commitment, other than any such Person that ceases to be a Canadian Revolving Lender pursuant to an Assignment and Assumption.

Canadian Revolving Loan” means a Revolving Loan made by the Canadian Revolving Lenders to the Canadian Borrower or U.S. Borrowers pursuant to the Canadian Commitment.

Canadian Secured Obligations” means all Canadian Obligations together with all (a) Banking Services Obligations of the Canadian Loan Parties or any Foreign Subsidiaries and (b) Swap Obligations of the Canadian Loan Parties or any Foreign Subsidiaries owing to one or more Qualified Counterparties; provided that Excluded Swap Obligations with respect to any Loan Party shall not be Canadian Secured Obligations of such Loan Party.

Canadian Security Agreements” means, collectively, that certain Canadian Pledge and Security Agreement, dated as of the date hereofEffective Date, among the Canadian Loan Parties and the Administrative Agent, the Quebec Security Documents, and, as the context requires, any other pledge or security agreement entered into, after the Effective Date by any other Canadian Loan Party (as required by this Agreement or any other Loan Document), as the same may be amended, restated or otherwise modified from time to time.

Canadian Subsidiary” means any subsidiary of Parent that has been formed or is organized under the laws of Canada or any province or territory thereof.

Canadian Swingline Exposure” means, at any time, the aggregate Dollar AmountEquivalent of all outstanding Canadian Swingline Loans at such time.  The Canadian Swingline Exposure of any Canadian Revolving Lender at any time shall be its Applicable Percentage of the total Canadian Swingline Exposure at such time.

Canadian Swingline Lender” means JPMorgan Chase Bank, N.A. Toronto Branch, in its capacity as lender of Canadian Swingline Loans hereunder, and its successors and assigns in such capacity.

Canadian Swingline Loan” has the meaning set forth in Section 2.05(a).

Capital Expenditures” means, for any period, (a) the additions to property, plant and equipment and other capital expenditures of Parent and the Subsidiaries that are (or would be) set forth in a consolidated statement of cash flows of Parent for such period prepared in accordance with GAAP and the amount of expenditures by the Parent Company and its Subsidiaries for the acquisition of Tuxedo Rental Product and (b) such portion of principal payments on Capital Lease Obligations or Synthetic Lease Obligations made by the CompanyParent and its consolidated Subsidiaries during such period as is attributable to additions to property, plant and equipment that have not otherwise been reflected on the consolidated statement of cash flows as additions to property, plant and equipment for such period; provided that the term “Capital Expenditures” shall not include (i) expenditures made in connection with the replacement, substitution, restoration or repair of assets to the extent financed with (x) insurance

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proceeds paid on account of the loss of or damage to the assets being replaced, restored or repaired or (y) awards of compensation arising from the taking by eminent domain or condemnation of the assets being replaced, (ii) the purchase price of equipment that is purchased simultaneously with the trade-in of existing equipment to the extent that the gross amount of such purchase price is reduced by the credit granted by the seller of such equipment for the equipment being traded in at such time, (iii) the purchase of plant, property or equipment or software to the extent financed with the net proceeds of any sale, transfer, lease or other disposition (including pursuant to a Sale/Leaseback Transaction or by way of merger or consolidation) of any asset of Parent or any Restricted Subsidiary, including any sale or issuance to a Person other than Parent or any Restricted Subsidiary of Equity Interests in any Subsidiary, but excluding sales of Inventory in the ordinary course of business, (iv) expenditures that constitute rental expenses under operating leases of real or personal property, (v) expenditures that are accounted for as capital expenditures by the Parent or any Restricted Subsidiary and that actually are paid for by a Person other than the Parent or any Restricted Subsidiary and for which neither the Parent nor any Restricted Subsidiary has provided or is required to provide or incur, directly or indirectly, any consideration or obligation to such Person or any other Person (whether before, during or after such period), (vi) the book value of any asset owned by the Parent or any Restricted Subsidiary prior to or during such period to the extent that such book value is included as a capital expenditure during such period as a result of such Person reusing or beginning to reuse such asset during such period without a corresponding expenditure actually having been made in such period; provided that (x) any expenditure necessary in order to permit such asset to be reused shall be included as a Capital Expenditure during the period in which such expenditure actually is made and (y) such book value shall have been included in Capital Expenditures when such asset was originally acquired, or (vii) expenditures that constitute Permitted Acquisitions (including, for this purpose, the Acquisition).

Capital Lease Obligations” of any Person means 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 and, for the purposes of this Agreement, the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

Cash Equivalents” means:

(a)        marketable direct obligations issued or unconditionally guaranteed by the United States Government, the Government of Canada, or the UK government, or issued by an agency thereof and backed by the full faith and credit of the United States Government, the Government of Canada, or the UK government, as the case may be, in each case maturing within two years after the date of acquisition thereof;

(b)        marketable direct obligations issued by any state of the United States of America, or any political subdivision of any such state or any public instrumentality thereof or by the Canadian federal government, in each case maturing within two years after the date of acquisition thereof and, at the time of acquisition, having the highest rating obtainable from either Standard & Poor’s or Moody’s (or, if at any time neither Standard & Poor’s nor Moody’s shall be rating such obligations, then from such other nationally recognized rating services acceptable to the Administrative Agent);

(c)        commercial paper maturing no more than nine months after the date of creation thereof and, at the time of acquisition, having a rating of at least A-2 or P-2 from either Standard & Poor’s or Moody’s (or, if at any time neither Standard & Poor’s nor Moody’s shall be rating such obligations, then the highest rating from such other nationally recognized rating services acceptable to the Administrative Agent);

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(d)        certificates of deposit or bankers acceptances denominated in US Dollars, Canadian Dollars, Sterling or Euro and maturing within ninety (90) days after the date of acquisition thereof issued by any Lender or any other commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia, or Canada or the UK, in each case having combined capital and surplus of not less than $250,000,000 (or the foreign currency equivalent thereof);

(e)        repurchase agreements of the Administrative Agent, any Lender or any other commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia, or Canada or the UK, in each case having combined capital and surplus of not less than $250,000,000 (or the foreign currency equivalent thereof);

(f)        overnight investments with the Administrative Agent, any Lender or any other commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia, or Canada or the UK, in each case having combined capital and surplus of not less than $250,000,000 (or the foreign currency equivalent thereof);

(g)        other readily marketable instruments issued or sold by the Administrative Agent, any Lender or any other commercial bank organized under the laws of the United States of America or any state thereof or the District of Columbia, or Canada or the UK, in each case having combined capital and surplus of not less than $250,000,000 (or the foreign currency equivalent thereof); and

(h)        funds invested in brokerage accounts with nationally recognized brokerage houses or money market accounts, in each case for less than thirty (30) days.

CDOR Rate” means, for the relevant Interest Period, the Canadian dealerdollar offered rate which, in turn means on any day the sum of (a) the annual rate of interest determined with reference to the arithmetic average of the discount rate quotations of all institutions listed in respect of the relevant Interest Period for Canadian Dollar-denominated bankers’ acceptances displayed and identified as such on the “Reuters Screen CDOR Page” as defined in the International Swaps and Derivatives Association Inc. definitions, as modified and amended from time to time, as of 10:00CDOR Page” (or any display substituted therefore) of Reuters Monitor Money Rates Service Reuters Screen, or, in the event such rate does not appear on such page or screen, on any successor or substitute page or screen that displays such rate, or on the appropriate page of such other information service that publishes such rate from time to time, as selected by the Canadian Administrative Agent in its reasonable discretion (the “CDOR Screen Rate”), at or about 10:15 a.m. Toronto local time on such daythe first day of the applicable Interest Period and, if such day is not a Business Day, then on the immediately preceding Business Day (as adjusted by the Canadian Administrative Agent after 10:0015 a.m. Toronto local time to reflect any error in the posted rate of interest or in the posted average annual rate of interest) plus (b) 0.10% per annum; provided that if such rates are(x) if the CDOR Screen Rate shall be less than zero, such rate shall be deemed to be zero and (y) if the CDOR Screen Rate is not available on the Reuters Screen CDOR Page on any particular day, then the Canadian depositdollar offered rate component of such rate on that day shall be calculated as the cost of funds quoted by the Canadian Administrative Agent to raise Canadian Dollars for the applicable Interest Periodapplicable Interpolated Rate as of 10:00 a.m. Toronto localsuch time on such day for commercial loans or other extensions of credit to businesses of comparable credit risk;  or if such day is not a Business Day, then as quoted by the Canadian Administrative Agentso determined on the immediately preceding Business Dayprovided further that if the CDOR Rate for any Interest Period shall be less than zero, such rate shall be deemed to be zero for the purposes of this Agreement.  “CDOR Rate” when used with respect to a Loan or a Borrowing shall refer to whether such

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Loan, or the Loans comprising such Borrowing, bears interest at a rate determined by reference to the CDOR Rate.

CFC” means each Person that is a “controlled foreign corporation” within the meaning of Section 957(a) of the Code.

CFC Holdco” means a Domestic Subsidiary with no material assets other than equity interests of one or more Foreign Subsidiaries that are CFCs.

Change in Control” means (a) any transaction (including a merger, amalgamation or consolidation) the result of which is that any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act) becomes the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act) of more than 50 percent (50%) of the total voting power of all classes of the voting stock of Parent or the surviving Person and/or warrants or options to acquire such voting stock, calculated on a fully diluted basis, (b) the sale, lease or transfer of all or substantially all of Parent’s assets (whether Equity Interest in its Subsidiaries, the assets of its Subsidiaries, or some combination thereof) to any “person” or “group” (within the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act), except to Parent or one or more of its Restricted Subsidiaries, (c) at any time prior to the termination of the aggregate Canadian Commitments, Parent shall cease to own, directly or indirectly, 100% of the issued and outstanding Equity Interests of the Canadian Borrower, or (d) except in connection with a transaction pursuant to which such U.S. Subsidiary Borrower shall cease to be a U.S. Subsidiary Borrower in accordance with this Agreement, Parent shall cease to own, directly or indirectly, 100% of the issued and outstanding Equity Interests of each U.S. Subsidiary Borrower.

Change in Law” means the occurrence, after the Effective Date, of any of the following:  (a) the adoption or taking effect of any rule, regulation, treaty or other law, (b) any change in any rule, regulation, treaty or other law or in the administration, interpretation, implementation or application thereof by any Governmental Authority or (c) the making or issuance of any request, rule, guideline or directive (whether or not having the force of law) by any Governmental Authority; provided that, notwithstanding anything herein to the contrary, (i) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (ii) 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, promulgated or issued.

Charges” has the meaning set forth in Section 9.16.

Co-Documentation Agents” means, collectively(i) with respect to the Original Credit Agreement, U.S. Bank National Association, Union Bank, N.A. and Wells Fargo Bank, N.A., and (ii) with respect to Amendment No. 2, U.S. Bank National Association and Fifth Third Bank.

Code” means the Internal Revenue Code of 1986, as amended.

Collateral” means the Canadian Collateral and the U.S. Collateral.

Collateral Access Agreement” has the meaning set forth in the applicable Security Agreement.

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Collateral and Guarantee Requirement” means, at any time, the requirement that:

(a)        the Administrative Agent shall have received from Parent and each Designated Subsidiary either (i) (A) in the case of Parent and each Designated Subsidiary that is a Domestic Subsidiary, a counterpart of this Agreement and the U.S. Security Agreement, duly executed and delivered on behalf of such Person or (B) in the case of the Canadian Borrower and each Designated Subsidiary that is a Canadian Subsidiary, a counterpart of this Agreement and the applicable Canadian Security Agreements, duly executed and delivered on behalf of such Person, or (ii) in the case of any Person that becomes a Designated Subsidiary after the Effective Date, (A) a Joinder Agreement, duly executed and delivered on behalf of such Person, and (B) instruments in the form or forms specified in the applicable Security Agreement under which such Person becomes a party to the applicable Security Agreement, duly executed and delivered on behalf of such Person, together with such documents and opinions with respect to such Designated Subsidiary as may reasonably be requested by the Administrative Agent;

(b)        subject to Section 5.18, the Administrative Agent shall have received all such Collateral Access Agreements, Deposit Account Control Agreements and other Collateral Documents required to be provided to it under the applicable Security Agreement, duly executed by the parties thereto and evidence that all Credit Card Notifications required to be provided pursuant to Section 5.16 have been provided;

(c)        all Equity Interests owned by or on behalf of any Loan Party shall have been pledged pursuant to, and to the extent required by, the applicable Security Agreement and, solely with respect to U.S. Secured Obligations, in the case of Equity Interests entitled to vote (within the meaning of Treas. Reg. Section 1.956-2(c)(2)) in any CFC or CFC Holdco owned by a U.S. Borrower, the U.S. Borrower shall not be required to pledge more than 65% of such Equity Interests entitled to vote of any such CFC or CFC Holdco or enter into any pledge agreement governed by the laws of any jurisdiction outside the United States of America, and the Administrative Agent shall, to the extent required by the applicable Security Agreement, have received certificates or other instruments representing all such certificated Equity Interests, together with undated stock powers or other instruments of transfer with respect thereto endorsed in blank;

(d)        all Indebtedness of Parent and any Subsidiary and all Indebtedness of any other Person, in each case that is owing to any Loan Party and in a principal amount of $1,000,000 or more shall be evidenced by a promissory note and shall have been pledged pursuant to the applicable Security Agreement, and the Administrative Agent shall have received all such promissory notes, together with undated instruments of transfer with respect thereto endorsed in blank;

(e)        all documents and instruments, including UCC financing statement and PPSA registrations, required by the Collateral Documents or this Agreement with the priority required by the Collateral Documents shall have been filed, registered or recorded or delivered to the Administrative Agent for filing, registration or recording; and

(f)        each Loan Party shall have obtained all material consents and approvals required in connection with the execution and delivery of all Collateral Documents to which it is a party and the performance of its obligations thereunder.

Notwithstanding the foregoing, any Designated Subsidiary formed or acquired after the Effective Date shall not be required to comply with the foregoing requirements prior to the time specified in

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Section 5.03.  The foregoing definition shall not require the creation or perfection of pledges of or security interests in, or the obtaining of title insurance or, subject to the requirements of applicable law, flood insurance, legal opinions, appraisals, surveys or other deliverables with respect to, particular assets of the Loan Parties, or the provision of Guarantees by any Subsidiary, if and for so long as the Administrative Agent, in consultation with Parent, determines that the cost of creating or perfecting such pledges or security interests in such assets, or obtaining such title insurance or flood insurance, legal opinions, appraisals, surveys or other deliverables in respect of such assets, or providing such Guarantees, shall be excessive in view of the benefits to be obtained by the Lenders therefrom.  The Administrative Agent may in its sole discretion, grant extensions of time for the creation and perfection of security interests in (including delivery of promissory notes as required by clause (d) above) or the obtaining of title insurance or, subject to the requirements of applicable law, flood insurance, legal opinions, appraisals, surveys or other deliverables with respect to particular assets or the provision of any Guarantee by any Subsidiary (including extensions beyond the Effective Date or in connection with assets acquired, or Subsidiaries formed or acquired, after the Effective Date) where it determines that such action cannot be accomplished without undue effort or expense by the time or times at which it would otherwise be required to be accomplished by this Agreement or the Collateral Documents, it being acknowledged and agreed that Administrative Agent shall take the cooperation of and constraints upon third party providers into consideration when making such determination.

Collateral Documents” means each Security Agreement, each Collateral Access Agreement, each Credit Card Notification, each Deposit Account Control Agreement, each IP Security Agreement and each other document or instrument guaranteeing the payment of or granting or perfecting a Lien upon any assets of any Loan Party as security for payment of the Secured Obligations.

“Collection Day Fee Letter” means the Collection Day Fee Letter dated June 18, 2014, between the Company and JPMCB.

Commercial LC Exposure” means, at any time, the sum of (a) the aggregate undrawn Dollar AmountEquivalent of all outstanding Commercial Letters of Credit at such time plus (b) the aggregate Dollar AmountEquivalent of all LC Disbursements relating to Commercial Letters of Credit that have not yet been reimbursed by or on behalf of the Borrowers at such time.  The Commercial LC Exposure of any Lender under any Facility at any time shall be its Applicable Percentage of the total Commercial LC Exposure under such Facility at such time.

Commercial Letter of Credit” means a Letter of Credit that is (a) designated as a Commercial Letter of Credit by the Borrower Representative at the time of, or prior to, the issuance thereof, (b) issued to provide for the payment of the purchase price for goods or services purchased by Parent or any Subsidiary and (c) intended to be drawn when such purchase price is due and payable and not merely upon the occurrence of a default or other contingency.

Commitment” means, with respect to each Lender, such Lender’s U.S. Commitment and/or Canadian Commitment.

Commitment Letter” means the Commitment Letter dated March 11, 2014, among JPMCB, J.P. Morgan Securities LLC, Bank of America, N.A. Merrill Lynch, Pierce, Fenner & Smith Incorporated and Parent.

Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et seq.), as amended from time to time, and any successor statute.

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Communications” means, collectively, any written notice, demand, communication, information, document or other material provided by or on behalf of any Loan Party pursuant to any Loan Document or the transactions contemplated therein that is distributed to the Administrative Agent, any Lender or any Issuing Bank by means of electronic communications pursuant to Section 9.01, including through the Platform.

Company” has the meaning set forth in the recitalsintroductory paragraph of this Agreement.

Compliance Certificate” means a Compliance Certificate in the form of Exhibit D or any other form approved by the Administrative Agent.

Concentration Account” has the meaning set forth in the applicable Security Agreement.

Consolidated Cash Interest Expense” means, for any period, the excess of (a) the sum of (i) the cash interest expense (including (x) imputed interest expense in respect of Capital Lease Obligations and Synthetic Lease Obligations, (y) all commissions, discounts and other fees and charges owed with respect to letters of credit and bankers’ acceptance financing and (z) net costs under Swap Agreements entered into to hedge interest rates to the extent such net costs are allocable to such period in accordance with GAAP) of Parent and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP, (ii) any interest accrued during such period in respect of Indebtedness of Parent or any Restricted Subsidiary that is required to be capitalized rather than included in consolidated interest expense for such period in accordance with GAAP, plus (iii) any cash payments made during such period in respect of obligations referred to in clause (b)(iii) below that were amortized or accrued in a previous period, minus (b) the sum of (i) interest income of Parent and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP, (ii) to the extent included in such consolidated interest expense for such period, non-cash amounts attributable to amortization or write-off of capitalized interest or other financing costs paid in a previous period, plus (iii) to the extent included in such consolidated interest expense for such period, non-cash amounts attributable to accretion or amortization of debt discounts or accrued interest payable in kind for such period.

Consolidated EBITDA” means, for any period, Consolidated Net Income for such period, plus (a) without duplication and to the extent deducted (and not added back) in determining such Consolidated Net Income, the sum of (i) consolidated interest expense, net of interest income (and, to the extent not reflected therein, bank and letter of credit fees and costs of surety bonds in connection with financing activities) for such period (including imputed interest expense in respect of Capital Lease Obligations and Synthetic Lease Obligations), (ii) consolidated income tax expense for such period (including any tax benefit for such period), (iii) all amounts attributable to depreciation and amortization for such period, (iv) any non-cash extraordinary charges for such period, (v) any (i) non-cash compensation charge or expense arising from any grant of stock, stock options or other equity based awards and any non-cash deemed finance charges in respect of any pension liabilities or other provisions and (ii) income (loss) attributable to deferred compensation plans or trusts, (vi) any other non-cash charges (other than the write-down or write-off of current assets, any additions to bad debt reserve or bad debt expense or any accruals for estimated sales discounts, returns or allowances) for such period, (vii) any losses for such period attributable to early extinguishment of Indebtedness or obligations under any Swap Agreement, (viii) any costs, fees, losses and expenses paid in connection with, and other unusual or non-recurring charges (or losses) relating to, the Transactions, in each case, paid or incurred on or prior to the Effective Date or prior to the end of the first full fiscal quarter ending after the Effective Date, (ix) any net after-tax extraordinary, unusual or nonrecurring losses, costs, charges or expenses (including, without limitation, restructuring, business optimization costs, charges or reserves (including any unusual or non-recurring operating expenses directly attributable to the implementation of cost savings initiatives), recruiting fees, fees of restructuring or business optimization consultants, integration and non-recurring severance,

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relocation, consolidation, transition, integration or other similar charges and expenses, contract termination costs, excess pension charges, system establishment charges, start-up or closure or transition costs, expenses related to any reconstruction, decommissioning, recommissioning or reconfiguration of fixed assets for alternative uses, fees, expenses or charges relating to curtailments or modifications to pension and post-retirement employee benefit plans and litigation settlements or losses outside the ordinary course of business), provided that the aggregate amount added back pursuant to this clause (ix) may not exceed, when aggregated with the amount of any increase for such period to Consolidated EBITDA pursuant to clause (ii) of the definition of “Pro Forma Basis,” 10% (or, for any four fiscal quarter period ending prior to the end of the eighth full fiscal quarter ending after the Effective Date, 20%, so long as any such amount above 10% is attributable to the Transactions and the integration of the Acquired Company and its Subsidiaries) of Consolidated EBITDA for such period (prior to giving effect to any increase pursuant to such clause (ii) or this clause (a)(ix)), (x) costs, fees, losses, expenses, premiums or penalties incurred during such period in connection with Permitted Acquisitions (whether or not consummated), other Investments consisting of acquisitions or assets or equity constituting a business unit, line of business, division or entity (whether or not consummated) and permitted Asset Sales (whether or not consummated), other than Asset Sales effected in the ordinary course of business, (xi) any expense or charges incurred during such period in connection with the Permitted Borrower Reorganization, any permitted issuance of debt, equity securities or any refinancing transactions (in each case, whether or not consummated), (xii) amortization of Tuxedo Rental Products and (xiii) the excess of rent expense in respect of operating leases in accordance with GAAP for such period over cash rent expense in respect of operating leases for such period (to the extent exceeding cash rent) and minus (b) without duplication (i) to the extent not deducted in determining such Consolidated Net Income, all cash payments made during such period on account of non-cash charges that were or would have been added to Consolidated Net Income pursuant to clauses (a)(iv), (a)(v) or (a)(vi) above in such period or in a previous period, (ii) to the extent included in determining such Consolidated Net Income, (A) any extraordinary gains and all non-cash items of income (other than normal accruals in the ordinary course of business) for such period and (B) any gains for such period attributable to early extinguishment of Indebtedness or obligations under any Swap Agreement, all determined on a consolidated basis in accordance with GAAP and (iii) the amount, if any, by which cash rent expense for such period exceeded rent expense in respect of operating leases in accordance with GAAP for such period;  provided that Consolidated EBITDA shall be calculated so as to exclude the effect of any gain or loss that represents after-tax gains or losses attributable to any sale, transfer or other disposition of assets by the U.S. BorrowerParent or any Subsidiary, other than dispositions in the ordinary course of business.  For purposes of calculating Consolidated EBITDA (except for purposes of determining compliance with Section 6.12) for any period, if during any period Parent or any Restricted Subsidiary shall have consummated a Pro Forma Event since the first day of such period, Consolidated EBITDA for such period shall be calculated on a Pro Forma Basis after giving effect thereto.

 

Consolidated Fixed Charges” means, for any period, the sum, without duplication, of (a) Consolidated Cash Interest Expense for such period, (b) scheduled principal payments on Indebtedness made during such period, (c) expense for income taxes paid in cash during such period and (d) Restricted Payments paid in cash during such period pursuant to clauses (a)(iii) and (a)(vi) of Section 6.08.

Consolidated Net Income” means, for any period, the net income or loss of Parent and the Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded (a) the income of any Person (other than Parent) that is not a Restricted Subsidiary except to the extent of the amount of cash dividends or similar cash distributions actually paid by such Person to Parent or, subject to clauses (b) and (c) below, any of the Restricted Subsidiaries during such period, (b) the income of, and any amounts referred to in clause (a) above paid to, any Restricted Subsidiary (other than a Loan Party) to the extent that, on the date of determination, the declaration or payment of cash dividends or similar cash distributions by such Restricted Subsidiary is

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restricted by operation of the terms of its organizational documents or any agreement, instrument, judgment, decree, statute, rule or regulation applicable to such Restricted Subsidiary and (c) the income or loss of, and any amounts referred to in clause (a) above paid to, any Restricted Subsidiary that is not wholly owned by Parent to the extent such income or loss or such amounts are attributable to the noncontrolling interest in such Restricted Subsidiary.

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.  “Controlling” and “Controlled” have meanings correlative thereto.

“Co-Syndication Agents” means (i) with respect to the Original Credit Agreement, Bank of America, N.A., and (ii) with respect to Amendment No. 2, Bank of America, N.A.and Wells Fargo Bank, N.A.

Covenant Period” means any period (a) commencing on any date when Availability shall have been less than the greater of (i) 10% of the Line Cap and (ii) $40,000,00044,000,000 and (b) ending on the first day thereafter when Availability shall have been at least the greater of (i) 10% of the Line Cap then in effect and (ii) $40,000,00044,000,000 for at least 30 consecutive days.

Credit Card Accounts Receivable” means any receivables due to any Loan Party from a credit card issuer or a credit card processor in connection with purchases of Inventory of such Loan Party on (a) credit cards issued by Visa, MasterCard, American Express, Discover, PayPal, Wells Fargo, each of their respective Affiliates, and any other credit card issuers that are reasonably acceptable to the Administrative Agent, (b) private label credit cards of any Loan Party issued under non-recourse arrangements substantially similar to those in effect on the Effective Date or (c) debit cards and mall cards issued by issuers or providers that are reasonably acceptable to the Administrative Agent, in each case which have been earned by performance by such Loan Party but not yet paid to such Loan Party by such credit card issuer or credit card processor.

Credit Card Agreement” means any agreement between a Loan Party, on the one hand, and a credit card issuer or a credit card processor (including any credit card processor that processes purchases of Inventory from a Loan Party through debit cards or mall cards), on the other hand.

Credit Card Notifications” means each Credit Card Notification, in form and substance reasonably satisfactory to the Administrative Agent, executed by one or more Loan Parties and delivered by such Loan Parties to credit card issuers or credit card processors that are party to any Credit Card Agreement.

Credit Exposure” means, as to any Lender at any time, the sum of (a) such Lender’s U.S. Credit Exposure plus (b) such Lender’s Canadian Credit Exposure.

Default” means any event or condition that constitutes an Event of Default or that upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

Defaulting Lender” means any Lender, as determined by the Administrative Agent, that has (a) failed to fund any portion of its Loans or participations in Letters of Credit, Swingline Loans, Protective Advances or Overadvances within three Business Days of the date required to be funded by it hereunder, (b) notified any Borrower, the Administrative Agent, any Issuing Bank, the Swingline Lender or any Lender in writing that it does not intend to comply with any of its funding obligations under this Agreement or has made a public statement to the effect that it does not intend to comply with its funding obligations under this Agreement or under other agreements in which it commits to extend credit, (c)

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failed, within three Business Days after request by the Administrative Agent, to confirm that it will comply with the terms of this Agreement relating to its obligations to fund prospective Loans and participations in then outstanding Letters of Credit, Swingline Loans, Protective Advances or Overadvances, (d) otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within three Business Days of the date when due, unless the subject of a good faith dispute, or (e)(i) become or is insolvent or has a parent company that has become or is insolvent or (ii) become the subject of a bankruptcy or insolvency proceeding under any Insolvency Laws or otherwise, or has had a receiver, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment or has a parent company that has become the subject of a bankruptcy or insolvency proceeding under any Insolvency Laws or otherwise, or has had a receiver, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or appointment; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition of any equity interest in that Lender or any direct or indirect parent company thereof by a Governmental Authority so long as such ownership interest does not result in or provide such Lender with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permit such Lender (or such Governmental Authority) to reject, repudiate, disavow or disaffirm any contracts or agreements made with such Lender.

Deposit Account” has the meaning set forth in the applicable Security Agreement.

Deposit Account Control Agreement” has the meaning set forth in the applicable Security Agreement.

Designated Noncash Consideration” means the fair market value of noncash consideration received by Parent or any of its Restricted Subsidiaries in connection with an asset sale that is so designated as Designated Noncash Consideration pursuant to a certificate of a Financial Officer of Parent delivered to the Administrative Agent setting forth the basis of such valuation, less the amount of cash and Cash Equivalents received in connection with a subsequent sale of such Designated Noncash Consideration.

Designated Obligations” has the meaning set forth in Section 9.19.

Designated Person” means any person or entity listed on a Sanctions List.

Designated Subsidiary” means each Subsidiary other than any Excluded Subsidiary.

Disclosed Matters” means the actions, suits and proceedings and the environmental matters disclosed in Section 3.06 of the Disclosure Letter and of the Disclosure Letter Supplement.

Disclosure Letter” means the letter from the BorrowerBorrowers to the Lenders delivered on or prior to the date hereof.the Effective Date.

“Disclosure Letter Supplement” means the letter from the Borrowers to the Lenders delivered on the Amendment No. 2 Effective Date.

Disqualified Stock” means any Equity Interests which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, (a) matures (excluding any maturity as the result of an optional redemption by the issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option

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of the holder thereof, in whole or in part, or requires the payment of any cash dividend or any other scheduled payment constituting a return of capital, in each case at any time on or prior to the first anniversary of the Maturity Date, or (b) is convertible into or exchangeable (unless at the sole option of the issuer thereof) for (i) cash, (ii) debt securities or (iii) any Equity Interests referred to in (a) above, in each case at any time prior to the first anniversary of the Maturity Date.  Notwithstanding the foregoing, any Equity Interests that would constitute Disqualified Stock solely because holders of the Equity Interests have the right to require the issuer of such Equity Interests to repurchase such Equity Interests upon the occurrence of a change of control or an asset sale will not constitute Disqualified Stock if the terms of such Equity Interests provide that the issuer may not repurchase or redeem any such Equity Interests pursuant to such provisions unless such repurchase or redemption is permitted under the terms of this Agreement.

Document” has the meaning set forth in the U.S. Security Agreement.

Dollar Amount” means (a) with regard to any Obligation or calculation denominated in Dollars, the amount thereof, and (b) with regard to any Obligation or calculation denominated in any other currency, the amount of Dollars which is equivalent to the amount so expressed in such currency at the Spot Rate on the relevant date of determination.Equivalent” of any amount means, at the time of determination thereof, (a) if such amount is expressed in Dollars, such amount, (b) if such amount is expressed in Canadian Dollars or an LC Alternative Currency, the equivalent of such amount in Dollars determined by using the rate of exchange for the purchase of the Dollars with Canadian Dollars or the LC Alternative Currency, as applicable, in the London foreign exchange market at or about 11:00 a.m. London time (or New York time, as applicable) on a particular day as displayed by ICE Data Services as the “ask price”, or as displayed on such other information service which publishes that rate of exchange from time to time in place of ICE Data Services (or if such service ceases to be available, the equivalent of such amount in Dollars as determined by the Agent using any method of determination it deems appropriate in its sole discretion)  and (c) if such amount is denominated in any other currency, the equivalent of such amount in Dollars as determined by the Agent using any method of determination it deems appropriate in its sole discretion.

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

Domestic Subsidiary” means any Subsidiary of the U.S. BorrowerParent that is organized under the laws of the United States, any state of the United States or the District of Columbia.

Dominion Period” means any period (a) during which any Event of Default has occurred and is continuing or (b) during a Reduced Availability Period; provided that if all applicable circumstances described in clauses (a) and (b) shall cease to exist, the Borrower Representative may, not more than twice during each period of 12 consecutive months, request that the Administrative Agent discontinue the applicable Dominion Period, and the Administrative Agent will promptly comply with such request and will provide notification of such discontinuance to the Loan Parties’ credit card issuers and credit card processors.

“EEA Financial Institution” means (a) any institution 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 institution established in an EEA Member Country which is a subsidiary of an institution described in clauses (a) or (b) of this definition and is subject to consolidated supervision with its parent;

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

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“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 on which the conditions precedent in Section 4.01 are satisfied.June 18, 2014.

Eligible Accounts” means, at any time, each Account that satisfies the following criteria at the time of creation and continues to meet the same at the time of such determination: such Account (i) has been earned by performance and represents the bona fide amounts due to a Loan Party and in each case is originated in the ordinary course of business of such Loan Party, and (ii) in each case is not ineligible for inclusion in the calculation of the Borrowing Base pursuant to any of clauses (a) through (x) below.  Without limiting the foregoing, to qualify as an Eligible Account, such Account shall indicate no Person other than a Loan Party as payee or remittance party.  Any Account included within any of the following categories shall not constitute an Eligible Account:

(a)        which is not subject to a first priority perfected security interest in favor of the Administrative Agent;

(b)        which is subject to any Lien other than (i) a Lien in favor of the Administrative Agent, (ii) a Permitted Encumbrance which does not have priority over the Lien in favor of the Administrative Agent, (iii) Liens in respect of Prior Claims that are unregistered and that secure amounts that are not yet due and payable and (iv) Liens that are subject to the Intercreditor Agreement;

(c)        (i) with respect to which the scheduled due date is more than 90 days after the date of the original invoice therefor, (ii) which is unpaid more than 90 days after the date of the original invoice therefor or more than 60 days after the original due date therefor (“Overage”) when calculating the amount under this clause (ii), for the same Account Debtor, the Administrative Agent shall include the net amount of such Overage and add back any credits, but only to the extent that such credits do not exceed the total gross receivables from such Account Debtor, or (iii) which has been written off the books of such Borrower or otherwise designated as uncollectible;

(d)        which is owing by an Account Debtor for which more than 50% of the Accounts owing from such Account Debtor and its Affiliates are ineligible pursuant to clause (c) above;

(e)        which is owing by an Account Debtor to the extent the aggregate amount of Accounts owing from such Account Debtor and its Affiliates to all Loan Parties exceeds 25% of the aggregate amount of Eligible Accounts of all Loan Parties;

(f)        with respect to which any covenant, representation or warranty contained in this Agreement or in the applicable Security Agreement has been breached or is not true;

(g)        which (i) does not arise from the sale of goods or performance of services in the ordinary course of business, (ii) is not evidenced by an invoice or other documentation (the form of which is reasonably satisfactory to the Administrative Agent) which has been sent to the Account Debtor, (iii) represents a progress billing, (iv) is contingent upon such Loan Party’s completion of any further performance, (v) represents a sale on a bill-and-hold, guaranteed sale, sale-and-return, sale on approval, consignment, cash-on-delivery or any other repurchase or return basis or (vi) relates to payments of interest;

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(h)        for which the goods giving rise to such Account have not been shipped to the Account Debtor or for which the services giving rise to such Account have not been performed by such Loan Party or if such Account was invoiced more than once;

(i)         with respect to which any check or other instrument of payment has been returned uncollected for any reason;

(j)         which is owed by an Account Debtor which has (i) applied for, suffered, or consented to the appointment of any receiver, custodian, trustee, or liquidator or similar official for such Account Debtor of its assets, (ii) had possession of all or a material part of its property taken by any receiver, custodian, trustee or liquidator, (iii) filed, or had filed against it, any assignment, application, request or petition for liquidation, reorganization, arrangement, adjustment of debts, stay of proceedings, adjudication as bankrupt, winding-up, or voluntary or involuntary case or proceeding under any state, provincial or federal bankruptcy laws or any other Insolvency Laws (other than post-petition accounts payable of an Account Debtor that is a debtor-in-possession under the Bankruptcy Code and reasonably acceptable to the Administrative Agent), (iv) admitted in writing its inability, or is generally unable to, pay its debts as they become due, (v) become insolvent, or (vi) ceased operation of its business;

(k)        which is owed by any Account Debtor which has sold all or substantially all of its assets;

(l)        which is owed by an Account Debtor which (i) does not maintain its chief executive office in the U.S. or Canada (or its domicile, for the purposes of the Civil Code (Quebec)) (ii) is not organized under applicable law of the U.S., any state of the U.S., the District of Columbia, or Canada unless, in any such case, such Account is backed by a letter of credit acceptable to the Administrative Agent which is in the possession of, and is directly drawable by, the Administrative Agent;

(m)       which is owed in any currency other than U.S. dollars or Canadian Dollars;

(n)        which is owed by (i) any Governmental Authority of any country other than the U.S. or Canada unless such Account is backed by a Letter of Credit acceptable to the Administrative Agent which is in the possession of, and is directly drawable by, the Administrative Agent, or (ii) any Governmental Authority of the U.S. or Canada, or any department, agency, public corporation, or instrumentality thereof, unless the Financial Administration Act (Canada), as amended, (or the equivalent law of any province of Canada, if any, in the case of a Governmental Authority of such province) or the Federal Assignment of Claims Act of 1940, as amended (31 U.S.C. § 3727 et seq. and 41 U.S.C. § 15 et seq.), as applicable, and any other steps necessary to perfect the Lien of the Administrative Agent in such Account have been complied with to the Administrative Agent’s satisfaction;

(o)        which is owed by any Affiliate of any Loan Party or any employee, officer, director, agent or stockholder of any Loan Party or any of its Affiliates;

(p)        which is owed by an Account Debtor or any Affiliate of such Account Debtor to which any Loan Party is indebted, but only to the extent of such indebtedness, or is subject to any security, deposit, progress payment, retainage or other similar advance made by or for the benefit of an Account Debtor, in each case to the extent thereof;

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(q)        which is subject to any counterclaim, deduction, defense, setoff or dispute but only to the extent of any such counterclaim, deduction, defense, setoff or dispute;

(r)         which is evidenced by any promissory note, chattel paper or instrument;

(s)        which is owed by an Account Debtor located in any jurisdiction which requires filing of a “Notice of Business Activities Report” or other similar report in order to permit such Loan Party to seek judicial enforcement in such jurisdiction of payment of such Account, unless such Loan Party has filed such report or qualified to do business in such jurisdiction;

(t)         with respect to which such Loan Party has made any agreement with the Account Debtor for any reduction thereof, other than discounts and adjustments given in the ordinary course of business, but only to the extent of any such reduction, or any Account which was partially paid and such Loan Party created a new receivable for the unpaid portion of such Account;

(u)        which does not comply in all material respects with the requirements of all material applicable laws and regulations, whether Federal (U.S. or Canadian), state, provincial, territorial or local, including without limitation the U.S. Federal Consumer Credit Protection Act, the U.S. Federal Truth in Lending Act and Regulation Z of the Board;

(v)        which is for goods that have been sold under a purchase order or pursuant to the terms of a contract or other agreement or understanding (written or oral) that indicates or purports that any Person other than such Loan Party has or has had an ownership interest in such goods, or which indicates any party other than such Loan Party as payee or remittance party;

(w)       which was created on cash on delivery terms; or

(x)        which the Administrative Agent determines may not be paid by reason of the Account Debtor’s inability to pay or which the Administrative Agent otherwise determines is unacceptable in its Permitted Discretion.

In the event that an Account of a Loan Party which was previously an Eligible Account ceases, to the actual knowledge of a Financial Officer of Parent, to be an Eligible Account hereunder, the Borrower Representative shall notify the Administrative Agent thereof promptly, and in any event no later than the time of submission to the Administrative Agent of the next Borrowing Base Certificate.  In determining the amount of an Eligible Account of a Loan Party, the face amount of an Account may, in the Administrative Agent’s Permitted Discretion, be reduced by, without duplication, to the extent not reflected in such face amount, (i) the amount of all accrued and actual discounts, claims, credits or credits pending, promotional program allowances, price adjustments or finance charges (including any amount that such Loan Party may be obligated to rebate to an Account Debtor pursuant to the terms of any agreement or understanding (written or oral)) and (ii) the aggregate amount of all cash received in respect of such Account but not yet applied by such Loan Party to reduce the amount of such Account.

 “Eligible Assignee” means (a) a Lender, (b) an Affiliate of a Lender, (c) an Approved Fund and (d) any other Person, other than, in each case, a natural person or Parent, any Subsidiary or any other Affiliate of Parent.

Eligible Credit Card Accounts Receivable” means at the time of any determination thereof, each Credit Card Accounts Receivable that satisfies the following criteria at the time of creation and continues to meet the same at the time of such determination: such Credit Card Accounts Receivable (i) has been

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earned by performance and represents the bona fide amounts due to a Loan Party from a credit card issuer or credit card processor, and in each case is originated in the ordinary course of business of such Loan Party, and (ii) in each case is not ineligible for inclusion in the calculation of the Borrowing Base pursuant to any of clauses (a) through (o) below.  Without limiting the foregoing, to qualify as an Eligible Credit Card Accounts Receivable, such Credit Card Accounts Receivable shall indicate no Person other than a Loan Party as payee or remittance party.  In determining the amount to be so included, the face amount of a Credit Card Accounts Receivable shall be reduced by, without duplication, to the extent not reflected in such face amount, (i) the amount of all accrued and actual fees and charges due to the credit card issuer or credit card processor, discounts, claims, credits or credits pending, promotional program allowances, price adjustments, finance charges or other allowances (including any amount that a Loan Party may be obligated to rebate to a customer, a credit card issuer or credit card processor pursuant to the terms of any agreement or understanding) and (ii) the aggregate amount of all cash received in respect of such Credit Card Accounts Receivable but not yet applied by the Loan Parties to reduce the amount of such Credit Card Accounts Receivable. Any Credit Card Receivable included within any of the following categories shall not constitute an Eligible Credit Card Receivable:

(a)        which is not earned or does not represent the bona fide amount due to a Loan Party from a credit card processor or a credit card issuer that originated in the ordinary course of business of the applicable Loan Party;

(b)        which is not owned by a Loan Party or to which a Loan Party does not have good or marketable title;

(c)        in which the payee of such Credit Card Account Receivable is a Person other than a Loan Party;

(d)        which does not constitute an “Account” (as defined in the UCC or the PPSA) or a Payment Intangible;

(e)        which has been outstanding for more than five Business Days (or, in the case of American Express, 10 Business Days) from the date of sale;

(f)        with respect to which the applicable credit card issuer, credit card processor or debit card or mall card issuer or provider has (i) applied for, suffered, or consented to the appointment of any receiver, interim receiver, custodian, trustee, monitor, administrator, sequestrator or liquidator of its assets, (ii) has had possession of all or a material part of its property taken by any receiver, interim receiver, custodian, trustee, monitor, administrator, sequestrator or liquidator, (iii) filed, or had filed against it (but only so long as any such involuntary filing has not been stayed or vacated), any request or petition for liquidation, reorganization, arrangement, adjustment of debts, adjudication as bankrupt, winding-up, or voluntary or involuntary case under any state, provincial, territorial or federal bankruptcy laws, (iv) has admitted in writing its inability, or is generally unable to, pay its debts as they become due, (v) become insolvent or (vi) ceased operation of its business;

(g)        which is not a valid, legally enforceable obligation of the applicable credit card issuer or credit card processor with respect thereto;

(h)        which is not subject to a properly perfected first priority security interest in favor of the Administrative Agent (for the benefit of the Lender Parties);

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(i)         which is subject to any Lien, other than (i) a Lien in favor of the Administrative Agent (for the benefit of the Lender Parties), (ii) any Permitted Encumbrances contemplated by the applicable processor agreements and for which appropriate Reserves (as determined by the Administrative Agent in its Permitted Discretion) have been established, (iii) Liens permitted by Section 6.02(i), (iv) Liens in respect of Prior Claims that are unregistered and secure amounts that are not yet due and payable and (v) Liens that are subject to the Intercreditor Agreement;

(j)         with respect to which (i) any covenant has been breached or (ii) any representation or warranty is not true in all material respects, in each case to the extent contained in this Agreement, the applicable Security Agreement or in the credit card agreements relating to such Credit Card Account Receivable; provided that each such representation and warranty shall be true and correct in all respects to the extent already qualified by a materiality standard;

(k)        which is subject to risk of set-off, recoupment, non-collection or not being processed due to unpaid and/or accrued credit card processor fee balances, to the extent of the lesser of the balance of the applicable Credit Card Accounts Receivable or the unpaid credit card processor fees;

(1)        which is evidenced by “chattel paper” or an “instrument” of any kind unless such “chattel paper” or “instrument” is in the possession of the Administrative Agent, and to the extent necessary or appropriate, endorsed to the Administrative Agent;

(m)       which the Administrative Agent in its Permitted Discretion determines may not be paid by reason of the applicable credit card processor’s, credit card issuer’s or debit card or mall card issuer’s or provider’s inability to pay;

(n)        which represents a deposit or partial payment in connection with the purchase of Inventory of such Loan Party;

(o)        which is not subject to a Credit Card Notification; or

(p)        which does not meet such other usual and customary eligibility criteria for Credit Card Accounts Receivable in the Loan Parties’ industry generally as the Administrative Agent in its Permitted Discretion may determine from time to time; provided,  however, that the Administrative Agent shall not add any additional eligibility criteria (or amend any then-existing eligibility criteria to make the same more restrictive) without giving at least four Business Days’ prior notice to the Borrower Representative.

In the event that (a) a Financial Officer of Parent has actual knowledge that any credit card issuer, credit card processor or debit card or mall card issuer or provider with respect to Eligible Credit Card Accounts Receivable ceases to comply with the requirements of clause (f) above or (b) a Credit Card Account Receivable which was previously an Eligible Credit Card Account Receivable ceases to be an Eligible Credit Card Account Receivable hereunder (other than by reason of clause (m) or (p) above), the applicable Loan Party or the Borrower Representative shall notify the Administrative Agent thereof promptly, and in any event not later than the time of submission to the Administrative Agent of the next Borrowing Base Certificate.

In determining the amount of an Eligible Credit Card Account Receivable, the face amount of a Credit Card Account Receivable may, in the Administrative Agent’s Permitted Discretion, be reduced by, without duplication, to the extent not reflected in such face amount, (i) the amount of all accrued and actual discounts, credits or credits pending, price adjustments or finance charges (including any amount

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that any Loan Party may be obligated to rebate to an Account Debtor pursuant to the terms of any agreement or understanding (written or oral)) applicable to such Credit Card Account Receivable, (ii) the aggregate amount of all cash received in respect of such Credit Card Account Receivable but not yet applied by any Loan Party to reduce the amount of such Credit Card Account Receivable and (iii) the amount of all customary fees and expenses in connection with any credit card arrangement.

Eligible Inventory” means, as of the date of determination thereof, without duplication, items of Inventory of a Loan Party that are finished goods or blank inventory (or, solely in the case of the U.S. Loan Parties, uncut fabric bolsters), merchantable and readily saleable in the ordinary course of the Loan Parties’ business, in each case that, except as otherwise agreed by the Administrative Agent, is not excluded as ineligible by virtue of one or more of the criteria set forth below.  The following items of Inventory shall not be included in Eligible Inventory:

(a)        which is not subject to a first priority perfected Lien in favor of the Administrative Agent (for the benefit of the Lender Parties);

(b)        which is subject to any Lien other than (i) a Lien in favor of the Administrative Agent (for the benefit of the Lender Parties), (ii) a Permitted Encumbrance which does not have priority over the Lien in favor of the Administrative Agent (for the benefit of the Lender Parties), (iii) Liens in respect of Prior Claims that are unregistered and secure amounts that are not yet due and payable, and (iv) Liens that are subject to the Intercreditor Agreement;

(c)        which is unmerchantable, defective, damaged or unfit for sale (as such terms are customarily used in the Loan Parties’ industry), or is not salable at prices approximating at least the cost of such Inventory in the ordinary course of business or is unacceptable due to age, type, category and/or quantity, in each case, consistent with the usage of such terms in the most recent inventory appraisal received by the Administrative Agent as contemplated hereby;

(d)        with respect to which any covenant, representation, or warranty contained in this Agreement or the applicable Security Agreement has been breached or is not true or which does not conform in all material respects to all standards imposed by any applicable Governmental Authority;

(e)        in which any Person other than such Loan Party shall (i) have any direct or indirect ownership, interest or title to such Inventory or (ii) be indicated on any purchase order or invoice with respect to such Inventory as having or purporting to have an interest therein;

(f)        which is not finished goods or blank inventory (or, solely in the case of the U.S. Loan Parties, uncut fabric bolsters) or which constitutes packaging and shipping material, samples, prototypes, displays or display items, bill-and-hold goods, goods that are returned or marked for return, repossessed goods, goods held on consignment, or goods which are not of a type held for sale in the ordinary course of business (for the avoidance of doubt, sales in the ordinary course of business includes clearance sales);

(g)        which is not located in the United States or, solely in the case of Inventory of a Canadian Loan Party, Canada or is in transit with a common carrier from vendors and suppliers; provided that up to $50,000,000 of such Inventory in transit shall not be excluded from being Eligible Inventory pursuant to this clause (g) so long as (i) the Administrative Agent shall have received (1) a true and correct copy of the bill of lading and other shipping documents for such Inventory (and, if such Inventory is in transit from outside the United States, such bill of lading is negotiable), (2) evidence of satisfactory casualty insurance naming the Administrative Agent as

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loss payee and otherwise covering such risks as the Administrative Agent may reasonably request, (3) confirmation that the applicable Loan Party has paid for the goods (unless such Loan Party’s payment obligations are covered by a Commercial Letter of Credit or a private label letter of credit) or that the applicable Loan Party has title to such Inventory (together with such evidence thereof as the Administrative Agent may from time to time require) and (4) if the bill of lading is (A) non-negotiable, a duly executed Collateral Access Agreement or other bailee agreement reasonably satisfactory to the Administrative Agent from the applicable customs broker for such Inventory, or (B) negotiable, confirmation that the bill is issued in the name of such Loan Party and consigned to the order of the Administrative Agent, and a reasonably acceptable agreement has been executed with such Loan Party’s customs broker, in which the customs broker agrees that it holds the negotiable bill as agent for the Administrative Agent and will follow instructions of the Administrative Agent with respect to the disposition thereof and of the goods, (ii) the common carrier is not an Affiliate of the applicable vendor or supplier and (iii) the customs broker is not an Affiliate of any Loan Party;

(h)       which is located in any location leased by the applicable Loan Party (other than any retail store of such Loan Party located in a jurisdiction that does not provide for a common law or statutory landlord’s lien on the personal property of tenants that would be prior or superior to that of the Administrative Agent) unless (i) the lessor (and any mortgagee, if applicable) has delivered to the Administrative Agent a Collateral Access Agreement or (ii) a Rent Reserve has been established by the Administrative Agent in its Permitted Discretion;

(i)        which is located at an owned location subject to mortgage in favor of a Person other than the Administrative Agent, unless the mortgagee is party to the Intercreditor Agreement or has delivered a Collateral Access Agreement or other mortgagee agreement in form and substance satisfactory to the Administrative Agent in its Permitted Discretion;

(j)        which is located in any third party warehouse or is in the possession of a bailee (other than a third party processor) and is not evidenced by a Document (other than bills of lading to the extent permitted pursuant to clause (g) above), unless (i) such warehouseman or bailee has delivered to the Administrative Agent a Collateral Access Agreement and such other documentation as the Administrative Agent may require or (ii) an appropriate Reserve has been established by the Administrative Agent in its Permitted Discretion; provided that up to $10,000,000  at any one time of such Inventory described in this clause (i) and not meeting the requirements of the preceding subclauses (i) and (ii) may be included as Eligible Inventory to the extent such Inventory is being held for not more than 60 days in a warehouse pending delivery to a store upon the initial opening thereof (including the initial opening after the renovation or remodeling of a store);

(k)       which is being processed offsite at a third party location or outside processor, or is in-transit to or from said third party location or outside processor;

(l)        which is the subject of a consignment by a Loan Party as consignor;

(m)      which contains or bears any intellectual property rights licensed to a Loan Party unless the Administrative Agent is satisfied that it may sell or otherwise dispose of such Inventory without (i) infringing the rights of such licensor, (ii) violating any contract with such licensor or (iii) incurring any liability with respect to payment of royalties other than royalties incurred pursuant to sale of such Inventory under the current licensing agreement;

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(n)        which is not reflected in a current perpetual inventory report of the applicable Loan Party (unless such Inventory is reflected in a report to the Administrative Agent as “in transit” Inventory);

(o)        for which reclamation rights have been asserted by the seller; and

(p)        which does not meet such other eligibility criteria for Inventory as the Administrative Agent in its Permitted Discretion may determine from time to time;

provided further that in determining the value of the Eligible Inventory, such value shall be reduced by, without duplication, any amounts representing (i) Vendor Rebates; (ii) costs included in Inventory relating to advertising; (iii) to the extent determined by the Administrative Agent in its Permitted Discretion to be appropriate, the shrink reserve; (iv) the unreconciled discrepancy between the general inventory ledger and the perpetual inventory ledger, to the extent the general inventory ledger reflects less Inventory than the perpetual inventory ledger; and (v) a reserve for Inventory which is designated or demanded to be returned to or retained by the applicable vendor or which is recognized as damaged or off quality by the applicable Loan Party.

In the event that a Financial Officer of the Parent has actual knowledge that Inventory at any location having a fair market value of $7,500,000 or more which was previously Eligible Inventory ceases to be Eligible Inventory hereunder (other than by reason of clause (o) above), such Loan Party or the Borrower Representative shall promptly notify the Administrative Agent thereof and, in any event, not later than the submission to the Administrative Agent of the next Borrowing Base Certificate hereunder; provided further that the Administrative Agent may, in its Permitted Discretion, upon receipt of such notice as set forth above, adjust the applicable Borrowing Base to reflect such change in Eligible Inventory.

Eligible Successor Agent” means (x) a bank or financial institution that is organized under the laws of the United States or any State or district thereof with an office in New York, New York which has a combined capital surplus of at least $200,000,000 or (y) in the case of the Canadian Administrative Agent only, an Affiliate of the Administrative Agent acting through a branch or an office in Canada.Eligible Tuxedo Rental Inventory” means, as of the date of determination thereof, without duplication, items of Tuxedo Rental Product of a Loan Party that are not excluded as ineligible by virtue of one or more of the criteria set forth below.  The following items of Tuxedo Rental Product shall not be included in Eligible Tuxedo Rental Inventory:

(a)        which does not meet the requirements set forth in clauses (a), (b), (d), (e), (f), (i), (j), (k), (l) or (n) of the definition of “Eligible Inventory”;

(b)        which is unmerchantable, defective, damaged or unfit for rental (as such terms are customarily used in the Loan Parties’ industry), or is unacceptable due to age, type, category and/or quantity, in each case, consistent with the usage of such terms in the most recent appraisal received by the Administrative Agent as contemplated hereby;

(c)        which is not located in the United States or, solely in the case of Tuxedo Rental Product of a Canadian Loan Party, Canada, or is in transit with a common carrier from vendors and suppliers; provided that up to $10,000,000 of such Tuxedo Rental Product in transit shall not be excluded from being Eligible Tuxedo Rental Inventory pursuant to this clause (c) so long as (i) the Administrative Agent shall have received (1) a true and correct copy of the bill of lading and other shipping documents for such Tuxedo Rental Product (and, if such Tuxedo Rental Product are in transit from outside the United States, such bill of lading is negotiable), (2) evidence of

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satisfactory casualty insurance naming the Administrative Agent as loss payee and otherwise covering such risks as the Administrative Agent may reasonably request, (3) confirmation that the applicable Loan Party has paid for the goods (unless such Loan Party’s payment obligations are covered by a Commercial Letter of Credit or a private label letter of credit) or that the applicable Loan Party has title to such Tuxedo Rental Product (together with such evidence thereof as the Administrative Agent may from time to time require) and (4) if the bill of lading is (A) non-negotiable, a duly executed Collateral Access Agreement or other bailee agreement reasonably satisfactory to the Administrative Agent from the applicable customs broker for such Tuxedo Rental Product, or (B) negotiable, confirmation that the bill is issued in the name of such Loan Party and consigned to the order of the Administrative Agent, and a reasonably acceptable agreement has been executed with such Loan Party’s customs broker, in which the customs broker agrees that it holds the negotiable bill as agent for the Administrative Agent and will follow instructions of the Administrative Agent with respect to the disposition thereof and of the goods, (ii) the common carrier is not an Affiliate of the applicable vendor or supplier and (iii) the customs broker is not an Affiliate of any Loan Party;

(d)        (i) which is located in any third party warehouse or is in the possession of a bailee (other than a third party processor or rental customer) and is not evidenced by a Document (other than bills of lading to the extent permitted pursuant to clause (c) above), unless (i) such warehouseman or bailee has delivered to the Administrative Agent a Collateral Access Agreement and such other documentation as the Administrative Agent may require or (ii) an appropriate Reserve has been established by the Administrative Agent in its Permitted Discretion; provided that up to $5,000,000  at any one time of such Tuxedo Rental Product described in this clause (d) and not meeting the requirements of the preceding subclauses (i) and (ii) may be included as Eligible Tuxedo Rental Inventory to the extent such Tuxedo Rentals are being held for not more than 60 days in a warehouse pending delivery to a store upon the initial opening thereof (including the initial opening after the renovation or remodeling of a store);

(e)        which is not included as “tuxedoreflected in a current rental product” on ainventory report entitled Tux Inventory.xlsx (in the case of the U.S. Borrowers) or MSP Tux Inventory.xlsx (in the case of the Canadian Loan Parties)of the applicable Loan Party in a form reasonably acceptable to the Administrative Agent;

(f)        which is reflected in an internal report of the applicable Loan Party as “damaged”, “hold”, “laundry”, “lost”, “repair” or “ship”, or such similar designation used by the Loan Parties from time to time; and

(g)        which does not meet such other eligibility criteria for Tuxedo Rental Product as the Administrative Agent in its Permitted Discretion may determine from time to time;

provided further that in determining the value of the Eligible Tuxedo Rental Inventory, such value shall be reduced by, without duplication, any amounts representing (i) Vendor Rebates; (ii) costs included in Eligible Tuxedo Rental Inventory relating to advertising; (iii) to the extent determined by the Administrative Agent in its Permitted Discretion to be appropriate, the shrink reserve; and (iv) a reserve for Tuxedo Rental Product which is designated or demanded to be returned to or retained by the applicable vendor or which is recognized as damaged or off quality by the applicable U.S. Borrower.

In the event that a Financial Officer of the Borrower Representative has actual knowledge that Tuxedo Rental Product at any location having a fair market value of $7,500,000 or more which was previously Eligible Tuxedo Rental Inventory ceases to be Eligible Tuxedo Rental Inventory hereunder (other than by reason of clause (f) above), such U.S. Borrower or the Borrower Representative shall

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promptly notify the Administrative Agent thereof and, in any event, not later than the submission to the Administrative Agent of the next Borrowing Base Certificate hereunder; provided further that the Administrative Agent may, in its Permitted Discretion, upon receipt of such notice as set forth above, adjust the U.S. Borrowing Base to reflect such change in Eligible Tuxedo Rental Inventory.

“Eligible Successor Agent” means (x) a bank or financial institution that is organized under the laws of the United States or any State or district thereof with an office in New York, New York which has a combined capital surplus of at least $200,000,000 or (y) in the case of the Canadian Administrative Agent only, an Affiliate of the Administrative Agent acting through a bra