NASDAQ0001009759falsetrue0001009759us-gaap:CommonStockMember2023-09-292023-09-290001009759us-gaap:SeriesBPreferredStockMember2023-09-292023-09-2900010097592023-09-292023-09-29

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15 (d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): September 29, 2023

CAPSTONE GREEN ENERGY CORPORATION

(Exact name of registrant as specified in its charter)

 

 

 

 

 

Delaware

 

001-15957

 

95-4180883

(State or other jurisdiction

 

(Commission File Number)

 

(IRS Employer

of incorporation)

 

 

 

Identification No.)

      

16640 Stagg Street,

 

 

 

 

Van Nuys, California

 

 

91406

(Address of principal executive offices)

 

 

(Zip Code)

(818734-5300

(Registrant’s telephone number, including area code)

Former name or former address, if changed since last report: N/A

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of exchange on which registered

Common Stock, par value $.001 per share

CGRN

NASDAQ Capital Market

Series B Junior Participating Preferred Stock Purchase Rights

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Item 1.01

Entry into Material Definitive Agreement

As previously disclosed, on September 28, 2023 (the “Petition Date”), Capstone Green Energy Corporation (the “Company”) and its wholly-owned subsidiaries, Capstone Turbine International, Inc. (“Capstone Turbine International”) and Capstone Turbine Financial Services, LLC, (“Capstone Turbine Financial” and, together with the Company and Capstone Turbine International, the “Debtors”), filed voluntary petitions (the “Chapter 11 Cases”) for relief under chapter 11 of title 11 (“Chapter 11”) of the United States Code (the “Bankruptcy Code”) in the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”). The Chapter 11 Cases are being jointly administered under the caption “In re: Capstone Green Energy Corporation, et al,” Cases No. 23-11634 (LSS). The Debtors continue to operate their businesses as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court.

DIP Note Purchase Agreement

In connection with the Chapter 11 Cases, on October 2, 2023, the Bankruptcy Court entered an interim order (the “Interim DIP Order”) authorizing and approving the Company’s entry into a Super-Priority Senior Secured Debtor-In-Possession Note Purchase Agreement (the “DIP Note Purchase Agreement”) among the Company as a Chapter 11 Debtor and Debtor-in-Possession, Capstone Turbine International and Capstone Turbine Financial, each as a Chapter 11 Debtor and Debtor-in Possession and as a Guarantor, Broad Street Credit Holdings LLC (the “Purchaser”) as Purchaser, and Goldman Sachs Specialty Lending Group, L.P. (the “Collateral Agent”) as Collateral Agent.

In accordance with the Interim DIP Order, on October 2, 2023, the Company entered into the DIP Note Purchase Agreement, which provides for $30.0 million in debtor-in-possession notes, consisting of $12.0 million of new money (the “New Money DIP Notes”) and a roll up of $18.0 million of Pre-Petition Secured Claims (the “Roll Up DIP Notes”). On October 2, 2023, the Company issued, and the Purchaser funded, $27.0 million in debtor-in-possession notes, consisting of $9.0 million of New Money DIP Notes and $18.0 million of Roll Up DIP Notes. The proceeds of the New Money DIP Notes will be used to fund restructuring expenses, for working capital and general corporate purposes and, solely with respect to the Roll Up DIP Notes, to effectuate the roll-up of Pre-Petition Obligations, each in accordance with the Bankruptcy Court Orders and a budget approved by the Debtors, Purchaser, and the Collateral Agent. Borrowings under the DIP Note Purchase Agreement bear interest at a rate of the SOFR Rate plus 8.75% per annum, which are payable in kind and added to the outstanding principal of the New Money DIP Notes. Each of the New Money DIP Notes and the Roll Up DIP Notes mature on the earlier of (i) forty-two (42) calendar days after the Petition Date, (ii) the date that is thirty-five (35) calendar days after the Petition Date if the Final Order has not been entered by the Bankruptcy Court on or before such date; (iii) the date of consummation of any sale of all or substantially all of the assets of any of the Debtors pursuant to section 363 of the Bankruptcy Code; (iv) the occurrence and continuation of an Event of Default not waived by Purchaser; (v) the substantial consummation or effective date of any Chapter 11 plan in the Chapter 11 Cases; (vi) the date the Bankruptcy Court enters an order for the conversion of any of the Chapter 11 Cases of any Debtors to a case under chapter 7 of the Bankruptcy Code; and (vii) dismissal of any of the Chapter 11 Cases of any Debtor. Upon the Debtors’ emergence from bankruptcy, it is expected that the DIP Note Purchase Agreement will be replaced by the Exit Facility described in the Current Report on Form 8-K filed by the Company on September 28, 2023 (the “Prior 8-K”).

The Company also paid a commitment fee equal to 2.0% of the aggregate commitment under the DIP Note Purchase Agreement. The fee was paid in kind and added to the principal balance of the New Money DIP Notes.

The DIP Note Purchase Agreement includes protections customary for financings of this type and size, including superpriority claims and priming liens on the Debtors’ assets, liens on previously unencumbered assets, in each case subject to certain Permitted Liens, and other protections set forth in the order approving the DIP Note Purchase Agreement. The DIP Note Purchase Agreement also includes conditions precedent, representations and warranties, affirmative and negative covenants, events of default, and other customary provisions.

The foregoing description of the DIP Note Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the copy of the DIP Note Purchase Agreement filed as Exhibit 4.1 hereto and incorporated herein by reference. This Current Report on Form 8-K supplements, and should be read together with, the information contained in the Prior 8-K.

Item 2.03

Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant

The information set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

Item 8.01

Other Events.

On September 29, 2023, the Bankruptcy court approved a variety of “first day” motions seeking customary relief intended to enable the Debtors to continue ordinary course operations during the Chapter 11 Cases by, among other things, making payments upon, or otherwise honoring, certain obligations that arose prior to the Petition Date. On September 29, 2023, the Bankruptcy Court also entered the Interim Order (I) Approving Notification and Hearing Procedures for Certain Transfers of Common Stock; and (II) Granting Related Relief (Docket No. 47) (the “NOL Order”), regarding the Company’s common stock, par value $0.001 per share (the “Common Stock”). The NOL Order is designed to assist the Debtors in preserving certain of their tax attributes by establishing among other things, procedures (including notice requirements) that restrict certain transactions involving, and require notices of the holdings of and proposed transactions by, any person or entity that is or, as a result of such a transaction, would become a Substantial Shareholder (as defined below) of Common Stock, as well as certain obligations with respect to notifying the Debtors with respect to current stock ownership (the “Procedures”). For purposes of the Procedures, a “Substantial Shareholder” is any person or entity that has direct or indirect beneficial ownership of, after taking into account certain options or other similar rights to acquire beneficial ownership of Common Stock, at least 832,500 shares of Common Stock (representing approximately 4.5% of all issued and outstanding shares of the Common Stock). The terms and conditions of the Procedures were immediately effective and enforceable upon entry of the NOL Order by the Bankruptcy Court. Any actions in violation of the Procedures (including the notice requirements) are null and void ab initio. Any person or entity violating the procedures may be required to take certain remedial actions specified by the Debtors, including (but not limited to) disposing of or requiring improperly-transferred stock or filing amended tax returns, as the case may be.

As set out in the Procedures, prior to entering into any transfer of beneficial ownership of Common Stock that would result in (i) an increase or decrease in the amount of Common Stock of which a Substantial Shareholder has beneficial ownership or (ii) any entity or individual becoming or ceasing to be a Substantial Shareholder, the parties to such transfer must file with the Bankruptcy Court and serve on the Notice Parties (as defined in the NOL Order) an advance written declaration of the intended transfer in accordance with the NOL Order. The Company will have five calendar days after receipt of written declarations in connection with transfers of beneficial ownership of Common Stock to file objections.

The foregoing description of the NOL Order is not complete and is qualified in its entirety by reference to the NOL Order, a copy of which is filed herewith as Exhibit 99.1 and is incorporated herein by reference.

Cautionary Note Regarding Trading in the Company’s Securities

The Company cautions that trading in its securities during the pendency of the Chapter 11 Cases is highly speculative and poses substantial risks. Trading prices for the Company’s securities may bear little or no relationship to the actual recovery, if any, by holders in the Chapter 11 Cases. The Common Stock may be quoted and traded on an over-the-counter market following delisting.

Additional Information on the Chapter 11 Cases

Court filings and information about the Chapter 11 Cases can be found at a website maintained by the Debtors’ noticing and claims agent, Kroll Restructuring Administration LLC (“Kroll”), at https://cases.ra.kroll.com/capstone or by contacting Kroll at 1-844-642-1256 (Toll Free), +1-646-651-1164 (International) or by e-mail at capstoneinfo@ra.kroll.com. The documents and other information available via such website or elsewhere are not part of this Current Report on Form 8-K and shall not be deemed incorporated herein.

Cautionary Statement Concerning Forward-Looking Statements

This Current Report on Form 8-K contains forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995, including the statement regarding the Chapter 11 Cases and other statements regarding the Company's expectations, beliefs, plans, intentions, and strategies. The Company has tried to identify these forward-looking statements by using words such as "expect," "anticipate," "believe," "could," "should," "estimate," "intend,"

"may," "will," "plan," "goal" and similar terms and phrases, but such words, terms and phrases are not the exclusive means of identifying such statements. Actual results, performance and achievements could differ materially from those expressed in, or implied by, these forward-looking statements due to a variety of risks, uncertainties and other factors, including, but not limited to, the following: risks attendant to the Chapter 11 bankruptcy process, including the Company’s ability to obtain court approval from the Bankruptcy Court with respect to motions or other requests made to the Bankruptcy Court throughout the course of the Chapter 11 process; the effects of Chapter 11, including increased legal and other professional costs necessary to execute the Chapter 11 process and on the Company’s liquidity and results of operations (including the availability of operating capital during the pendency of Chapter 11); the length of time that the Company will operate under Chapter 11 protection and the continued availability of operating capital during the pendency of Chapter 11; the Company’s ability to continue funding operations through the Chapter 11 bankruptcy process, and the possibility that it may be unable to obtain any additional funding as needed; the Company’s ability to meet its financial obligations during the Chapter 11 process and to maintain contracts that are critical to its operations; the Company’s ability to comply with the restrictions imposed by the terms and conditions of the DIP Note Purchase Agreement and other financing arrangements; objections to the DIP Note Purchase Agreement, or other pleadings filed that could protract Chapter 11; the effects of Chapter 11 on the interests of various constituents and financial stakeholders; the effect of the Chapter 11 filings on the Company’s relationships with vendors, regulatory authorities, employees and other third parties; possible proceedings that may be brought by third parties in connection with the Chapter 11 process and risks associated with third-party motions in Chapter 11; employee attrition and the Company’s ability to retain senior management and other key personnel due to the distractions and uncertainties; the impact and timing of any cost-savings measures and related local law requirements in various jurisdictions; the impact of litigation and regulatory proceedings; risks related to the restatement previously announced by the Company (including discovery of additional information relevant to the financial statements subject to restatement; changes in the effects of the restatement on the Company’s financial statements or financial results and delay in the filing of the amended 10-K and amended 10-Q’s due to the Company’s efforts to complete the restatement; the time, costs and expenses associated with the restatement; potential inquiries from the SEC and/or Nasdaq; the potential material adverse effect on the price of the Company’s common stock and possible stockholder lawsuits); and expectations regarding financial performance, strategic and operational plans, and other related matters. For a detailed discussion of factors that could affect the Company's future operating results, please see the Company's filings with the Securities and Exchange Commission, including the disclosures under "Risk Factors" in those filings. Except as expressly required by the federal securities laws, the Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, changed circumstances or future events or for any other reason.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

CAPSTONE GREEN ENERGY CORPORATION

Date: October 3, 2023

By:

/s/ Robert C. Flexon

Name: Robert C. Flexon

Title: Executive Chairman, Interim President and Chief Executive Officer

EXHIBIT 4.1

SUPER-PRIORITY SENIOR SECURED DEBTOR-IN-POSSESSION NOTE PURCHASE AGREEMENT

dated as of October 2, 2023

among

CAPSTONE GREEN ENERGY CORPORATION,
as a Chapter 11 Debtor and Debtor-in-Possession and Company,

and
THE OTHER DEBTORS PARTY HERETO FROM TIME TO TIME,

Each as a Chapter 11 Debtor and Debtor-in Possession and as a Guarantor,

BROAD STREET CREDIT HOLDINGS LLC,
as Purchaser and

GOLDMAN SACHS SPECIALTY LENDING GROUP, L.P.

as Collateral Agent

________________________________________________________

$30,000,000 Super-Priority Senior Secured Debtor-in-Possession Notes

________________________________________________________


TABLE OF CONTENTS

Page

Section 1 DEFINITIONS AND INTERPRETATION2

Section 2 DIP NOTES36

Section 3 CONDITIONS PRECEDENT55

Section 4 REPRESENTATIONS AND WARRANTIES59

i


4.31[Collateral Documents.]Error! Bookmark not defined.

Section 5 AFFIRMATIVE COVENANTS67

ii


Section 6 NEGATIVE COVENANTS79

Section 7 GUARANTY86

iii


Section 8 EVENTS OF DEFAULT90

Section 9 COLLATERAL AGENT97

Section 10 MISCELLANEOUS104

iv


APPENDICES:ACommitments
BNotice Addresses

SCHEDULES:1.1(b)Certain Material Real Estate Assets

1.1(c) Guarantors
4.1Jurisdictions of Organization and Qualification
4.2Capital Stock and Ownership
4.13Real Estate Assets

4.15Defaults
4.16Material Contracts
5.15Certain Post Closing Matters
6.1Certain Indebtedness
6.7Certain Investments
6.12Certain Affiliate Transactions

6.24Certain Employee Retention Plans

EXHIBITS:AFunding Notice
BLetter of Direction
CCompliance Certificate
D [Reserved]
E-1U.S. Tax Compliance Certificate
E-2[Reserved]
E-3[Reserved]
E-4U.S. Tax Compliance Certificate
F-1Closing Date Certificate
GCounterpart Agreement
H[Reserved]
IIntercompany Note

J-1New Money DIP Note

J-2Roll Up DIP Note


v


SUPER-PRIOIRITY SENIOR SECURED DEBTOR-IN-POSSESSION NOTE PURCHASE AGREEMENT

This SUPER-PRIOIRITY SENIOR SECURED DEBTOR-IN-POSSESSION NOTE PURCHASE AGREEMENT, dated as of October 2, 2023, is entered into by and among CAPSTONE GREEN ENERGY CORPORATION (“Company”), as issuer, certain Subsidiaries of Company, each as  Guarantor from time to time party hereto, each such Guarantor and Company as Chapter 11 debtor and debtor-in-possession, BROAD STREET CREDIT HOLDINGS LLC (“BSCH”) as Purchaser and GOLDMAN SACHS SPECIALTY LENDING GROUP, L.P. as collateral agent (in such capacity, “Collateral Agent”).

RECITALS:

WHEREAS, on September 28, 2023 (the “Petition Date”), Company and the Guarantors each filed voluntary petitions and initiated proceedings under Chapter 11 of the Bankruptcy Code (collectively, the “Chapter 11 Cases”) with the United States Bankruptcy Court for the District of Delaware (the “Bankruptcy Court”) and have continued in possession of their respective assets and in the management of their respective businesses pursuant to Sections 1107 and 1108 of the Bankruptcy Code;

WHEREAS, Company and the Guarantors are party to that certain Amended and Restated Note Purchase Agreement, dated as of September 1, 2020 (as amended, modified or supplemented from time to time prior to the Petition Date, the “Pre-Petition Note Purchase Agreement”), among Company, the Guarantors, the purchasers party thereto (collectively, the “Pre-Petition Purchasers”), Goldman Sachs Specialty Lending Group, L.P., as collateral agent (in such capacity, the “Pre-Petition Note Purchase Agent”), pursuant to which Company and the Guarantors executed and delivered various DIP Note Documents, as defined therein (collectively with the Pre-Petition Note Purchase Agreement, the “Pre-Petition Note Documents”), which, among other things, guaranteed and secured the obligations of Company and all of the Guarantors under the Pre-Petition Note Purchase Agreement;

WHEREAS, in accordance with the terms hereof, Purchaser has agreed to purchase super priority senior secured debtor-in-possession notes from the Company in the amounts and upon the terms and conditions more particularly set forth herein, the proceeds of which will be used in accordance with the Approved Budget; and

WHEREAS, in connection therewith, Company and the other Guarantors party hereto have agreed to guarantee the Obligations of the other DIP Note Parties hereunder and to secure all such Persons’ respective Obligations by granting to Collateral Agent, for the benefit of Secured Parties, the Liens described herein.

NOW, THEREFORE, to induce Purchaser to purchase the DIP Notes from Company and in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows:

1


Section 1DEFINITIONS AND INTERPRETATION
1.1Definitions.  The following terms used herein, including in the preamble, recitals, exhibits and schedules hereto, shall have the following meanings:

“Acceptable Auditor” means (i) Marcum LLP, (ii) a “Big Four” accounting firm, (iii) an independent certified public accountant of recognized national standing, (iv) a regional “mid-tier” firm of good public standing approved by the Public Company Accounting Oversight Board selected by Company or (v) any other independent certified public accountant reasonably satisfactory to Purchaser.

“Accounts” means all “accounts” (as defined in the UCC) of Company (or, if referring to another Person, of such Person), including accounts, accounts receivable, monies due or to become due and obligations in any form (whether arising in connection with contracts, contract rights, instruments, general intangibles, or chattel paper), in each case whether arising out of goods sold or services rendered or from any other transaction and whether or not earned by performance, now or hereafter in existence, and all documents of title or other documents representing any of the foregoing, and all collateral security and guaranties of any kind, now or hereafter in existence, given by any Person with respect to any of the foregoing.

“Acquisition” means the acquisition of, by purchase or otherwise (other than purchases or other acquisitions of inventory, materials and equipment and capital expenditures, in each case in the ordinary course of business), the business, a substantial portion of the property or assets of, or a substantial portion of the Capital Stock or other evidence of beneficial ownership of, any Person, any division or line of business, or any other business unit of any Person.

Additional DIP Notes Closing Date” means the date the Company issues New Money Additional DIP Notes and such New Money Additional DIP Notes are purchased by Purchaser in accordance with Section 2.1.

Adjusted Term SOFR” means, for purposes of any calculation, the rate per annum equal to (a) Term SOFR for such calculation plus (b) the Term SOFR Adjustment; provided, that if Adjusted Term SOFR as so determined shall ever be less than the Floor, then Adjusted Term SOFR shall be deemed to be the Floor.

“Adverse Proceeding” means any action, suit, proceeding, hearing (in each case, whether administrative, judicial or otherwise), governmental investigation or arbitration (whether or not purportedly on behalf of Company or any of its Subsidiaries) at law or in equity, or before or by any Governmental Authority, domestic or foreign (including any Environmental Claims), whether pending or, to the knowledge of Company or any of its Subsidiaries, threatened in writing against or affecting Company or any of its Subsidiaries or any property of Company or any of its Subsidiaries.

“Affected DIP Notes” as defined in Section 2.17(c).

“Affiliate” means, as applied to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, that Person. For the purposes of this definition, “control” (including, with correlative meanings, the terms “controlling,” “controlled

2


by” and “under common control with”), as applied to any Person, means the possession, directly or indirectly, of the power (i) to vote 10% or more of the Capital Stock having ordinary voting power for the election of members of the Board of Directors of such Person, or (ii) to direct or cause the direction of the management and policies of that Person, whether through the ability to exercise voting power, by contract or otherwise.  Notwithstanding anything in this definition to the contrary, neither the Warrant Holder nor any of its affiliates shall be considered an “Affiliate” of any DIP Note Party or of any Subsidiary of any DIP Note Party.

“Agent Affiliates” as defined in Section 10.1(b)(iii).

“Agreement” means this Super-Priority Senior Secured Debtor-in-Possession Note Purchase Agreement, as amended, restated, amended and restated, or otherwise modified from time to time.

“Anti-Corruption and Anti-Bribery Laws” means any and all requirements of law related to anti-bribery or anti-corruption matters, including the United States Foreign Corrupt Practices Act of 1977.

“Anti-Terrorism and Anti-Money Laundering Laws” means any and all requirements of law related to engaging in, financing, or facilitating terrorism or money laundering, including the PATRIOT Act, The Currency and Foreign Transactions Reporting Act (also known as the “Bank Secrecy Act”, 31 U.S.C. §§5311-5330 and 12 U.S.C. §§1818(s), 1820(b) and 1951-1959), Trading With the Enemy Act (50 U.S.C. §1 et seq.), Executive Order 13224 (effective September 24, 2001) and each of the laws, regulations, and executive orders administered by OFAC (31 C.F.R., Subtitle B, Chapter V).

“Applicable Margin” means (i) in the case of SOFR Rate DIP Notes, a percentage, per annum, equal to 8.75% and (ii) in the case of DIP Notes bearing interest at the Base Rate, a percentage, per annum, equal to 7.75%.

“Approved Budget” as defined in Section 5.1(y).

“Approved Electronic Communications” means any notice, demand, communication, information, document or other material that any DIP Note Party provides to Purchaser pursuant to any DIP Note Document or the transactions contemplated therein that is distributed to Collateral Agent or Purchaser by means of electronic communications pursuant to Section 10.1(b).

“Asset Sale” means a sale, lease or sub lease (as lessor or sublessor), sale and leaseback, assignment, conveyance, transfer (including through a plan of division), exclusive license (as licensor or sublicensor), or other disposition to, or any exchange of property with, any Person (other than to or with Company or any other DIP Note Party), in one transaction or a series of transactions, of all or any part of Company’s or any of its Subsidiaries’ respective businesses, assets or properties of any kind, whether real, personal, or mixed and whether tangible or intangible, whether now owned or hereafter acquired, leased, or licensed, including the Capital Stock of any of Company’s Subsidiaries, other than inventory sold or leased to unaffiliated customers in the ordinary course of business.  For purposes of clarification, “Asset Sale” shall (x) include (A) the sale or other disposition for value of any contracts and (B) the early termination or

3


modification of any contract resulting in the receipt by Company or any of its Subsidiaries of a cash payment or other consideration in exchange for such event (other than payments in the ordinary course for accrued and unpaid amounts that would have been due through the date of termination or modification without giving effect thereto) and (y) exclude a sale or issuance by Company of its own common stock (including, for the avoidance of doubt, in connection with any at the market offering of Company’s Capital Stock).

“Authorized Officer” means, as applied to any Person that is an entity, any duly authorized individual natural Person holding the position of chairman of the Board of Directors (if an officer), chief executive officer, president, vice president, Chief Financial Officer, or, if approved by Purchaser, any other officer position with similar authority; provided, that the secretary or assistant secretary of such Person, or another officer of such Person satisfactory to Purchaser, shall have delivered an incumbency certificate to Purchaser verifying the authority of such Authorized Officer.

“Available Tenor” means, as of any date of determination and with respect to the then-current Benchmark, as applicable, (x) if such Benchmark is a term rate, any tenor for such Benchmark (or component thereof) that is or may be used for determining the length of an interest period pursuant to this Agreement or (y) otherwise, any payment period for interest calculated with reference to such Benchmark (or component thereof) that is or may be used for determining any frequency of making payments of interest calculated with reference to such Benchmark pursuant to this Agreement, in each case, as of such date and not including, for the avoidance of doubt, any tenor for such Benchmark that is then-removed from the definition of the term “Interest Period” pursuant to Section 2.17.

“Avoidance Action Proceeds” means proceeds of claims and causes of action under Sections 502(d), 544, 545, 547, 548, 550 and 553 of the Bankruptcy Code.

“Bankruptcy Code” means Title 11 of the United States Code.

Bankruptcy Court” as defined in the Recitals hereto.

Bankruptcy Plan” means the Debtors’ Joint Prepackaged Chapter 11 Plan that is substantially in the form attached to the TSA as Exhibit A and prepared and distributed in accordance with the Bankruptcy Code, as it may be altered, amended, modified, or supplemented from time to time in accordance with the Bankruptcy Code and the TSA and otherwise in form and substance satisfactory to Collateral Agent and Purchaser (including with respect to the treatment of any outstanding Pre-Petition Obligations).

“Base Rate” means, for any day, a rate per annum equal to the greatest of (i) the Prime Rate in effect on such day, (ii) the Federal Funds Effective Rate in effect on such day plus ½ of 1.00%, (iii) the sum of (a) Adjusted Term SOFR (after giving effect to the Floor) for a one month tenor in effect on such day plus (b) the difference between the Applicable Margin for SOFR Rate DIP Notes and the Applicable Margin for Base Rate DIP Notes, and (iv) the Floor.  Any change in the Base Rate due to a change in the Prime Rate, the Federal Funds Effective Rate or Adjusted Term SOFR shall be effective on the effective day of such change in the Prime Rate, the Federal Funds Effective Rate or Adjusted Term SOFR, respectively.

4


“Base Rate DIP Notes” means a DIP Note bearing interest at a rate determined by reference to the Base Rate.

“Base Rate Term SOFR Determination Day” as defined in the definition of “Term SOFR”.

“Benchmark” means, initially, the Term SOFR Reference Rate; provided that if a Benchmark Transition Event has occurred with respect to the Term SOFR Reference Rate or the then-current Benchmark, then “Benchmark” means the applicable Benchmark Replacement to the extent that such Benchmark Replacement has replaced such prior benchmark rate pursuant to Section 2.17.

“Benchmark Replacement” means with respect to any Benchmark Transition Event, the first alternative set forth in the order below that can be determined by Collateral Agent for the applicable Benchmark Replacement Date:

a.The sum of (i) Daily Simple SOFR and (ii) 0.11448% (11.448 basis points); or
b.the sum of: (i) the alternate benchmark rate that has been selected by the Collateral Agent and the Company giving due consideration to (A) any selection or recommendation of a replacement benchmark rate or the mechanism for determining such a rate by the Relevant Governmental Body or (B) any evolving or then-prevailing market convention for determining a benchmark rate as a replacement to the then-current Benchmark for Dollar-denominated syndicated credit facilities and (ii) the related Benchmark Replacement Adjustment.

If the Benchmark Replacement as determined pursuant to clause (a) or (b) above would be less than the interest rate specified in clause (a) of the definition of “Floor”, the Benchmark Replacement will be deemed to be the interest rate specified in clause (a) of the definition of “Floor” for the purposes of this Agreement and the other DIP Note Documents.

“Benchmark Replacement Adjustment” means, with respect to any replacement of the then-current Benchmark with an Unadjusted Benchmark Replacement, the spread adjustment, or method for calculating or determining such spread adjustment, (which may be a positive or negative value or zero) that has been selected by the Collateral Agent and the Company giving due consideration to (a) any selection or recommendation of a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement by the Relevant Governmental Body or (b) any evolving or then-prevailing market convention for determining a spread adjustment, or method for calculating or determining such spread adjustment, for the replacement of such Benchmark with the applicable Unadjusted Benchmark Replacement for Dollar-denominated syndicated credit facilities at such time.

“Benchmark Replacement Date” means a date and time determined by the Collateral Agent, which date shall be no later than the earliest to occur of the following events with respect to the then-current Benchmark:

5


a.in the case of clause (a) or (b) of the definition of “Benchmark Transition Event”, the later of (i) the date of the public statement or publication of information referenced therein and (ii) the date on which the administrator of such Benchmark (or the published component used in the calculation thereof) permanently or indefinitely ceases to provide all Available Tenors of such Benchmark (or such component thereof); or
b.in the case of clause (c) of the definition of “Benchmark Transition Event”, the first date on which such Benchmark (or the published component used in the calculation thereof) has been determined and announced by or the regulatory supervisor for the administrator of such Benchmark (or such component thereof) to be non-representative; provided that such non-representativeness will be determined by reference to the most recent statement or publication referenced in such clause (c) and even if any Available Tenor of such Benchmark (or such component thereof) continues to be provided on such date.

For the avoidance of doubt, the “Benchmark Replacement Date” will be deemed to have occurred in the case of clause (a) or (b) with respect to any Benchmark upon the occurrence of the applicable event or events set forth therein with respect to all then-current Available Tenors of such Benchmark (or the published component used in the calculation thereof).

“Benchmark Transition Event” means the occurrence of one or more of the following events with respect to the then-current Benchmark:

a.a public statement or publication of information by or on behalf of the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that such administrator has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof), permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof);
b.a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof), the Federal Reserve Board, the Federal Reserve Bank of New York, an insolvency official with jurisdiction over the administrator for such Benchmark (or such component), a resolution authority with jurisdiction over the administrator for such Benchmark (or such component) or a court or an entity with similar insolvency or resolution authority over the administrator for such Benchmark (or such component), which states that the administrator of such Benchmark (or such component) has ceased or will cease to provide all Available Tenors of such Benchmark (or such component thereof) permanently or indefinitely; provided that, at the time of such statement or publication, there is no successor administrator that will continue to provide any Available Tenor of such Benchmark (or such component thereof); or
c.a public statement or publication of information by the regulatory supervisor for the administrator of such Benchmark (or the published component used in the calculation thereof) announcing that all Available Tenors of such Benchmark (or such component thereof) are not, or as of a specified future date will not be, representative.

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For the avoidance of doubt, a “Benchmark Transition Event” will be deemed to have occurred with respect to any Benchmark if a public statement or publication of information set forth above has occurred with respect to each then-current Available Tenor of such Benchmark (or the published component used in the calculation thereof).

“Benchmark Unavailability Period” means, the period (if any) (a) beginning at the time that a Benchmark Replacement Date has occurred if, at such time, no Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any DIP Note Document in accordance with Section 2.17 and (b) ending at the time that a Benchmark Replacement has replaced the then-current Benchmark for all purposes hereunder and under any DIP Note Document in accordance with Section 2.17.

“Beneficiary” means Collateral Agent and Purchaser.

“Board of Directors” means, (a) with respect to any corporation or company, the board of directors of the corporation or company or any committee thereof duly authorized to act on behalf of such board, (b) with respect to a partnership, the board of directors or equivalent governing body of the general partner of the partnership, (c) with respect to a limited liability company, the manager, the managing member or members or any controlling committee or board of managers (or equivalent governing body) of such company or the sole member or the managing member thereof, and (d) with respect to any other Person, the entity, individual, board or committee of such Person serving a similar function.

“Board of Governors” means the Board of Governors of the United States Federal Reserve System, or any successor Governmental Authority.

“Business Day” means any day excluding Saturday, Sunday and any day that is a legal holiday under the laws of the State of New York or is a day on which banking institutions located in any such state are authorized or required by law or other governmental action to close.

“Capital Lease” means, as applied to any Person, any lease of any property (whether real, personal or mixed) by that Person (i) as lessee that, in conformity with GAAP, is or should be accounted for as a capital lease on the balance sheet of that Person or (ii) as lessee which is a transaction of a type commonly known as a “synthetic lease” (i.e., a transaction that is treated as an operating lease for accounting purposes but with respect to which payments of rent are intended to be treated as payments of principal and interest on a loan for Federal income tax purposes); provided that “Capital Lease” shall in no event include Operating Lease Liabilities.

“Capital Lease Obligation” means, as applied to any Person that is a lessee under any Capital Lease, that portion of obligations under such Capital Lease that is properly classified as a liability on a balance sheet in conformity with GAAP.

“Capital Stock” means any and all shares, stock, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent ownership or profits interests in a Person that is another type of entity, including partnership interests, membership interests, voting trust certificates, certificates of interest, and profits interests, participations, or similar arrangements, and any and all warrants, rights or options to

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purchase, or other arrangements or rights to acquire, subscribe, convert to or otherwise receive or participate in the economic or other rights associated with any of the foregoing.

“Carve-Out” means the sum of: (i) all fees required to be paid to the clerk of the Bankruptcy Court and all statutory fees payable to the U.S. Trustee under section 1930(a) of title 28 of the United States Code plus interest at the statutory rate; (ii) all reasonable fees, costs and expenses in an aggregate amount not to exceed $25,000 incurred by a trustee under section 726(b) of the Bankruptcy Code; (iii) to the extent allowed at any time, whether by the interim order, procedural order, final order, or otherwise, all unpaid fees, costs, and expenses of persons or firms retained by the Debtors pursuant to sections 327, 328 or 363 of the Bankruptcy Code (the “Debtor Professionals”) and any Creditors’ Committee (the “Creditors’ Committee Professionals” and, together with the Debtor Professionals, the “Professional Persons”) appointed in the Chapter 11 Cases pursuant to section 1103 of the Bankruptcy Code, which shall be in accordance with the Approved Budget and incurred at any time on or before the first business day following delivery by the Collateral Agent to the Debtors and the Creditors’ Committee (if any) of a Carve-Out Trigger Notice (as defined in the Interim or Final Order), whether allowed by the Bankruptcy Court prior to or after such date; and (iv) Allowed Professional Fees (as defined in the Interim Order) of the Professional Persons in an aggregate amount not to exceed (x) $250,000 incurred or accrued after the first business day following delivery by the Collateral Agent of a Carve-Out Trigger Notice (as defined in the Interim or Final Order), to the extent allowed at any time, whether by interim order, procedural order, final order, or otherwise, (the amounts set forth in this clause (iv) being the “Post-Carve-Out Trigger Notice Cap”).  

“Cash” means money, currency or a credit balance in any demand or Deposit Account.

“Cash Equivalents” means, as at any date of determination, (i) marketable securities (a) issued or directly and unconditionally guaranteed as to interest and principal by the U.S. Federal Government, or (b) issued by any agency of the U.S., in each case of sub-clauses (a) and (b), the obligations of which are backed by the full faith and credit of the U.S., mature within one year after such date,  and have, at the time of the acquisition thereof, a rating of at least A-1 from S&P and at least P-1 from Moody’s; (ii) marketable direct obligations issued by any state of the U.S. or any political subdivision of any such state or any public instrumentality thereof, in each case maturing within one year after such date and having, at the time of the acquisition thereof, a rating of at least A-1 from S&P or at least P-1 from Moody’s; (iii) certificates of deposit or bankers’ acceptances maturing within three months after such date and issued or accepted by Purchaser or by any commercial bank organized under the laws of the U.S. or any state thereof or the District of Columbia that (a) is at least “adequately capitalized” (as defined in the regulations of its primary federal banking regulator), and (b) has Tier 1 capital (as defined in such regulations) of not less than $250,000,000; and (iv) shares of any money market mutual fund that (a) has at least 95% of its assets invested continuously in the types of investments referred to in clauses (i) and (ii) above, (b) has net assets of not less than $500,000,000, and (c) has the highest rating obtainable from either S&P or Moody’s.

“Change in Law” means the occurrence, after the date hereof, of any of the following: (a) the adoption or taking effect of any law, rule, regulation or treaty, (b) any change in any law, rule, regulation or treaty or in the administration, interpretation, implementation or

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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, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the U.S. or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

Change of Control” means, at any time: (i) any Person or “group” (within the meaning of Rules 13d-3 and 13d-5 under the Exchange Act) other than the Warrant Holder or any of its affiliates (a) shall have acquired beneficial ownership or control of 25% or more on a fully diluted basis of (1) the voting interests in the Capital Stock of Company and/or (2) the economic interests in the Capital Stock of Company, or (b) shall have obtained the power (whether or not exercised) to elect a majority of the members of the Board of Directors of Company; or (ii) the majority of the seats (other than vacant seats) on the Board of Directors of Company cease to be occupied by Persons who either (a) were members of the Board of Directors of Company on the Closing Date, or (b) were nominated for election by the Board of Directors of Company, a majority of whom were directors on the Closing Date or whose election or nomination for election was previously approved by a majority of such directors.

Chapter 11 Cases” as defined in the Recitals hereto.

“Chief Financial Officer” means, as applied to any Person that is an entity, any duly authorized individual natural Person holding the position of chief financial officer or, if approved by Purchaser, any other officer position with similar financial responsibility; provided, that the secretary or assistant secretary of such Person, or another officer of such Person satisfactory to Purchaser, shall have delivered an incumbency certificate to Purchaser verifying the authority of such Authorized Officer.

“Closing Date” means the date this Agreement was executed and the Roll Up DIP Notes were issued and purchased by Purchaser, which occurred on October 2, 2023.

“Closing Date Certificate” means a certificate dated as of the Closing Date as applicable, and substantially in the form of Exhibit F-1.

Code” means the Internal Revenue Code of 1986, as amended, and any Treasury regulations promulgated thereunder.  For the avoidance of doubt, references to specific sections of the Code shall include references to Treasury regulations interpreting such sections.

“Collateral” means, collectively, all of the real, personal and mixed property (including Capital Stock) in which Liens are granted and/or purported to be granted pursuant to the Collateral Documents as security for the Obligations, but excluding, for the avoidance of doubt, Excluded Property

“Collateral Agent” as defined in the preamble hereto.

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“Collateral Documents” means the Orders, the Pledge and Security Agreement, any Intellectual Property Security Agreements, any Mortgages, any Deposit Account Control Agreements, any Securities Account Control Agreements, and all other instruments, documents and agreements that are expressly designated pursuant to their terms to be “Collateral Documents” or are otherwise executed and delivered by or on behalf of any DIP Note Party or any other Person pursuant to this Agreement or any of the other DIP Note Documents in order to grant to, or perfect in favor of, Collateral Agent, for the benefit of Secured Parties, a Lien on any real, personal or mixed property of that DIP Note Party as security for the Obligations, in each case, as the same may be amended, restated, amended and restated or otherwise modified from time to time.

“Commitment” means the commitment of Purchaser to make or otherwise purchase the DIP Notes. The amount of  Purchaser’s Commitment, is set forth on Appendix A-1, subject to any adjustment or reduction pursuant to the terms and conditions hereof.  The aggregate amount of Commitments as of the Closing Date immediately prior to giving effect to the purchasing of the DIP Notes was $30,000,000, consisting of a $15,000,000 commitment to purchase Roll Up DIP Notes, the “Roll Up Commitment” and a $15,000,000 commitment to purchase New Money DIP Notes, the “New Money Commitment.”

“Company” as defined in the preamble hereto.

“Compliance Certificate” means a certificate of the Chief Financial Officer of Company substantially in the form of Exhibit C.

“Conforming Changes” means, with respect to either the use or administration of Term SOFR or the use, administration, adoption or implementation of any Benchmark Replacement, any technical, administrative or operational changes (including changes to the definition of “Base Rate,” the definition of “Business Day,” the definition of “U.S. Government Securities Business Day,” the definition of “Interest Period” or any similar or analogous definition (or the addition of a concept of “interest period”), timing and frequency of determining rates and making payments of interest, timing of borrowing requests or prepayment, conversion or continuation notices, the applicability and length of lookback periods, the applicability of Section 2.17(d) and other technical, administrative or operational matters) that the Collateral Agent reasonably decides may be appropriate to reflect the adoption and implementation of any such rate or to permit the use and administration thereof by the Collateral Agent in a manner substantially consistent with market practice (or, if the Collateral Agent reasonably decides that adoption of any portion of such market practice is not administratively feasible or if the Collateral Agent determines that no market practice for the administration of any such rate exists, in such other manner of administration as the Collateral Agent decides is reasonably necessary in connection with the administration of this Agreement and the other DIP Note Documents).

“Contractual Obligation” means, as applied to any Person, any provision of any Security issued by that Person or of any indenture, mortgage, deed of trust, contract, undertaking, agreement or other instrument to which that Person is a party or by which it or any of its properties is bound or to which it or any of its properties is subject.

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Controlled Account” means (a) any Deposit Account of a DIP Note Party that is subject to a Deposit Account Control Agreement, and (b) any Securities Account of a DIP Note Party that is subject to a Securities Account Control Agreement.

“Controlled Entity” means any DIP Note Party’s Controlled Affiliates. As used in this definition, “Control” means the power, directly or indirectly, to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

“Counterpart Agreement” means a Counterpart Agreement substantially in the form of Exhibit G delivered by a DIP Note Party pursuant to Section 5.10.

“Credit Date” means the date of the issuance and purchase of DIP Notes.

Creditors’ Committee” means any official committee of unsecured creditors appointed pursuant to Section 1102 of the Bankruptcy Code in the Chapter 11 Cases.

Creditors’ Committee Professionals” as defined in the definition of “Carve-Out”.

“Currency Agreement” means any foreign exchange contract, currency swap agreement, futures contract, option contract, synthetic cap or other similar agreement or arrangement, each of which is for the purpose of hedging the foreign currency risk associated with Company’s and its Subsidiaries’ operations and not for speculative purposes.

“Daily Simple SOFR” means, for any day, SOFR, with the conventions for this rate (which will include a lookback) being established by the Collateral Agent in accordance with the conventions for this rate selected or recommended by the Relevant Governmental Body for determining “Daily Simple SOFR” for syndicated business loans; provided that if the Collateral Agent reasonably decides that any such convention is not administratively feasible for the Collateral Agent, then the Collateral Agent may establish another convention in its reasonable discretion.

Debtor Professionals” as defined in the definition of “Carve-Out”.

“Debtor Relief Laws” means the Bankruptcy Code and all other liquidation, conservatorship, bankruptcy, assignment for the benefit of creditors, moratorium, rearrangement, receivership, insolvency, reorganization, or similar debtor relief laws of the U.S., any state or territory thereof, the District of Columbia or any other applicable jurisdictions.

Debtors” means the Company and the Guarantors.

“Default” means a condition or event that, after notice or lapse of time or both, would constitute an Event of Default.

“Default Rate” means any interest payable pursuant to Section 2.9.

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“Deposit Account” means any “deposit account” as defined in Article 9 of the UCC.

“Deposit Account Control Agreement” means, with respect to a Deposit Account, an agreement in form and substance reasonably satisfactory to Collateral Agent that (i) is entered into among Collateral Agent, the financial institution or other Person at which such Deposit Account is maintained, and the DIP Note Party maintaining such Deposit Account, and (ii) is effective for Collateral Agent to obtain “control” (within the meaning of Articles 8 and 9 of the UCC) of such Deposit Account.

DIP Note Documents” means any of this Agreement, the Collateral Documents, the DIP Notes, the Orders and all other documents, certificates, instruments or agreements that are expressly designated pursuant to their terms to be “DIP Note Documents” or are otherwise executed and delivered by or on behalf of a DIP Note Party or any other Person for the benefit of Collateral Agent or Purchaser in connection herewith, excluding, for the avoidance of doubt, the Warrants and any other documents related solely thereto.

“DIP Note Party” means Company, as issuer, and each Guarantor.

“DIP Notes” means the Roll Up DIP Notes and the New Money DIP Notes, as applicable.

“DIP Notes Maturity Date” means the earlier of (i) forty-two (42) calendar days after the Petition Date (the “Scheduled Maturity Date”), (ii) the date that is thirty-five (35) calendar days after the Petition Date if the Final Order has not been entered by the Bankruptcy Court on or before such date; (iii) the date of consummation of any sale of all or substantially all of the assets of any of the Debtors pursuant to section 363 of the Bankruptcy Code; (iv) the occurrence and continuation of an Event of Default not waived by Purchaser; (v) the substantial consummation or effective date of any Chapter 11 plan in the Chapter 11 Cases; (vi) the date the Bankruptcy Court enters an order for the conversion of any of the Chapter 11 Cases of any Debtors to a case under chapter 7 of the Bankruptcy Code; and (vii) dismissal of any of the Chapter 11 Cases of any Debtor; provided that, upon written request of Issuer, the Scheduled Maturity Date may be extended up to fifteen (15) calendar days (or such later date as agreed by Purchaser) in Purchaser’s sole discretion.

“Director” means any natural Person constituting the Board of Directors or an individual member thereof.

“Dispose” means, with respect to any Person, any conveyance, sale, lease (as lessor), license (as licensor), exchange, assignment, transfer or other disposition by such Person of any property or assets (whether now owned or hereafter acquired) to any other Person, in each case, whether or not the consideration therefor consists of Cash, Cash Equivalents, Securities or any other property or assets.   For purposes of clarification, “Dispose” shall include (a) the sale or other disposition for value of any contracts, (b) the early termination or modification of any contract by any Person resulting in the receipt by such Person of a Cash payment or other consideration in exchange for such event (other than payments in the ordinary course for previously accrued and unpaid amounts due through the date of termination or modification) or

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(c) any sale of merchant accounts (or any rights thereto (including any rights to any residual payment stream with respect thereto)).

“Disqualified Capital Stock” means any Capital Stock, other than the Warrants, that, by its terms (or by the terms of any other instrument, agreement or Capital Stock into which it is convertible or for which it is exchangeable), or upon the occurrence of any event or condition (i) matures or is mandatorily redeemable (other than solely for Qualified Capital Stock), pursuant to a sinking fund obligation or otherwise, (ii) is redeemable at the option of the holder or beneficial owner thereof (other than solely for Capital Stock that is not otherwise Disqualified Capital Stock), in whole or in part, (iii) provides for the scheduled payments of dividends, distributions or other Restricted Junior Payments in cash, or (iv) is or becomes convertible into or exchangeable for Indebtedness or any other obligation, instrument, agreement, or Capital Stock that would meet any of the conditions in clauses (i), (ii), or (iii) of this definition, in each case, prior to the date that is one hundred eighty days after the DIP Notes Maturity Date, except, in the case of clauses (i) and (ii), if as a result of a change of control or asset sale, so long as any rights of the holders thereof upon the occurrence of such a change of control or asset sale event are subject to the prior Payment in Full of all Obligations.

“Distribution” as defined in Section 7.7.

“Dollars” and the sign “$” mean the lawful money of the U.S.

“Domestic Subsidiary” means any Subsidiary organized under the laws of the U.S., any state thereof or the District of Columbia.

“Earn Out Obligations” means any obligation or liability consisting of an earnout or similar deferred purchase price that is issued or otherwise incurred as consideration for any acquisition of any property.

EDGAR System” means the Electronic Data Gathering Analysis and Retrieval System owned and operated by the SEC or any replacement system.

“Employee Benefit Plan” means any “employee benefit plan” as defined in Section 3(3) of ERISA that is or was sponsored, maintained or contributed to by, or required to be contributed by, Company, any of its Subsidiaries or any of their respective ERISA Affiliates.

“Environmental Claim” means any investigation, notice, notice of violation, claim, action, suit, proceeding, demand, abatement order or other order or directive (conditional or otherwise), by any Governmental Authority or any other Person, arising (i) pursuant to or in connection with any actual or alleged violation of any Environmental Law; (ii) in connection with any Hazardous Material or any actual or alleged Hazardous Materials Activity; or (iii) in connection with any actual or alleged damage, injury, threat or harm to health, safety, natural resources or the environment.

“Environmental Laws” means any and all current or future foreign or domestic, federal or state (or any subdivision of either of them), statutes, ordinances, orders, rules, regulations, judgments, Governmental Authorizations, or any other requirements of Governmental Authorities relating to (i) environmental matters, including those relating to any Hazardous

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Materials Activity; (ii) the generation, use, storage, transportation or disposal of Hazardous Materials; or (iii) occupational safety and health, industrial hygiene, land use or the protection of human, plant or animal health or welfare, in any manner applicable to Company or any of its Subsidiaries or any Facility.

“ERISA” means the Employee Retirement Income Security Act of 1974.

“ERISA Affiliate” means, as applied to any Person, (i) any corporation that is a member of a controlled group of corporations within the meaning of Section 414(b) of the Code of which that Person is a member; (ii) any trade or business (whether or not incorporated) that is a member of a group of trades or businesses under common control within the meaning of Section 414(c) of the Code of which that Person is a member; and (iii) any member of an affiliated service group within the meaning of Section 414(m) or (o) of the Code of which that Person, any corporation described in clause (i) above or any trade or business described in clause (ii) above is a member.  Any former ERISA Affiliate of Company or any of its Subsidiaries shall continue to be considered an ERISA Affiliate of Company or any such Subsidiary within the meaning of this definition with respect to the period such entity was an ERISA Affiliate of Company or such Subsidiary and with respect to liabilities arising after such period for which Company or such Subsidiary could be liable under the Code or ERISA.

“ERISA Event” means (i) a “reportable event” within the meaning of Section 4043 of ERISA and the regulations issued thereunder with respect to any Pension Plan (excluding those for which the provision for thirty day notice to the PBGC has been waived by regulation); (ii) the failure to meet the minimum funding standard of Section 412 of the Code with respect to any Pension Plan (whether or not waived in accordance with Section 412(c) of the Code) or the failure to make by its due date a required installment under Section 430(j) of the Code with respect to any Pension Plan or the failure to make any required contribution to a Multiemployer Plan; (iii) the provision by the administrator of any Pension Plan pursuant to Section 4041(a)(2) of ERISA of a notice of intent to terminate such plan in a distress termination described in Section 4041(c) of ERISA; (iv) the withdrawal by Company, any of its Subsidiaries or any of their respective ERISA Affiliates from any Pension Plan with two or more contributing sponsors or the termination of any such Pension Plan resulting in liability to Company, any of its Subsidiaries or any of their respective Affiliates pursuant to Section 4063 or 4064 of ERISA; (v) the institution by the PBGC of proceedings to terminate any Pension Plan, or the occurrence of any event or condition that might constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan; (vi) the imposition of liability on Company, any of its Subsidiaries or any of their respective ERISA Affiliates pursuant to Section 4062(e) or 4069 of ERISA or by reason of the application of Section 4212(c) of ERISA; (vii) the withdrawal of Company, any of its Subsidiaries or any of their respective ERISA Affiliates in a complete or partial withdrawal (within the meaning of Sections 4203 and 4205 of ERISA) from any Multiemployer Plan if there is any potential liability therefor, or the receipt by Company, any of its Subsidiaries or any of their respective ERISA Affiliates of notice from any Multiemployer Plan that it is in reorganization or insolvency pursuant to Section 4241 or 4245 of ERISA, or that it intends to terminate or has terminated under Section 4041A or 4042 of ERISA; (viii) the occurrence of an act or omission that could give rise to the imposition on Company, any of its Subsidiaries or any of their respective ERISA Affiliates of fines, penalties, taxes or related charges under Chapter 43 of the Code or under Section 409, Section 502(c), (i) or (l), or Section 4071 of ERISA in respect of any Employee

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Benefit Plan; (ix) the assertion of a material claim (other than routine claims for benefits) against any Employee Benefit Plan other than a Multiemployer Plan or the assets thereof, or against Company, any of its Subsidiaries or any of their respective ERISA Affiliates in connection with any Employee Benefit Plan; (x) receipt from the Internal Revenue Service of notice of the failure of any Pension Plan (or any other Employee Benefit Plan intended to be qualified under Section 401(a) of the Code) to qualify under Section 401(a) of the Code, or the failure of any trust forming part of any Pension Plan to qualify for exemption from taxation under Section 501(a) of the Code; or (xi) the imposition of a Lien pursuant to Section 430(k) of the Code or pursuant to Section 303(k) of ERISA with respect to any Pension Plan.

“Event of Default” means each of the conditions or events set forth in Section 8.1.

“Exchange Act” means the Securities Exchange Act of 1934.

“Excluded Accounts” means (i) payroll accounts or  employee benefits accounts as long as in the case of payroll accounts, the total amount on deposit at any time does not exceed the current expected amount of payroll obligations of the DIP Note Parties, (ii) zero balance accounts maintained by the DIP Note Parties, as long as any deposits or funds in any such accounts are transferred at least once each Business Day into a Controlled Account (including, for the avoidance of doubt, at any time following the exercise of exclusive control by Collateral Agent under the applicable control agreement with respect to such Controlled Account), (iii) [reserved], (iv) any segregated accounts holding solely Cash collateral for a third party to the extent such Lien is permitted under Section 6.2(n) hereof, the aggregate balance of which shall not at any time exceed 105% of the face value of such obligations and (v) accounts maintained at Wells Fargo Bank, National Association with account numbers 4443331152 and 4121826069; for so long as the aggregate balance in such accounts does not exceed $50,000 for any two (2) consecutive Business Day period.

“Excluded Property” has the meaning set forth in the Pledge and Security Agreement.

“Extraordinary Receipts” means any net Cash proceeds received by or paid for the account of Company or any of its Subsidiaries outside of the ordinary course of such Person’s business and any such payments in respect of purchase price adjustments (excluding working capital adjustments), tax refunds, judgments, settlements for actual or potential litigation or similar claims, pension plan reversions, indemnity payments, payments in respect of Earn Out Obligations or Seller Financing Indebtedness, and similar payments; provided, however, that “Extraordinary Receipts” shall not include (i) proceeds of any indemnity payment to the extent that no Event of Default exists at the time of receipt of such proceeds and such proceeds are promptly (and in any event within five Business Days) used to pay related third party claims and expenses, (ii) proceeds otherwise subject to Sections 2.13(a), 2.13(b) and 2.13(g) or (iii) to the extent any such amounts are (A) immediately payable to a Person that is not an Affiliate of the DIP Note Parties pursuant to an arrangement permitted under this Agreement or (B) received by the DIP Note Party or any of its Subsidiaries as reimbursement for any costs previously incurred or any payment previously made by a DIP Note Party.

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“Facility” means any real property (including all buildings, fixtures or other improvements located thereon) now, hereafter or heretofore owned, leased, operated or used by Company or any of its Subsidiaries.

“FATCA” means (a) Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations promulgated thereunder or official interpretations thereof and any agreements entered into pursuant to Section 1471(b)(1) of the Code, (b) any treaty, law, regulation or other official guidance enacted in any jurisdiction, or relating to an intergovernmental agreement between the United States and any other jurisdiction, with the purpose (in either case) of facilitating the implementation of clause (a) above, or (c) any agreement pursuant to the implementation of clauses (a) or (b) above with the United States Internal Revenue Service, the United States government or any governmental or taxation authority.

“Federal Funds Effective Rate” means for any day, the rate per annum (expressed, as a decimal, rounded upwards, if necessary, to the next higher 1/100 of 1%) equal to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System on such day, as published by the Federal Reserve Bank of New York on the next Business Day; provided, (i) if such day is not a Business Day, the Federal Funds Effective Rate for such day shall be such rate on such transactions on the preceding Business Day as so published on the next Business Day, and (ii) if no such rate is so published on such next Business Day, the Federal Funds Effective Rate for such day shall be the average rate charged to BSCH.

Final Order” means a final order of the Bankruptcy Court that, without limitation, authorizes each DIP Note Party’s entry into the DIP Note Documents, the incurrence of the DIP Notes thereunder and grants the Liens and security interests contained herein and therein, which order has not been reversed, vacated, or stayed, and is in form and substance satisfactory to Purchaser.

Financial Advisor” means Riveron Consulting, LLC or another advisor acceptable to Collateral Agent in its sole discretion.

“Financial Officer Certification” means, with respect to the financial statements for which such certification is required, the certification of the Chief Financial Officer of Company that, as of the date of such certification, such financial statements fairly present, in all material respects, the financial condition of Company and its Subsidiaries as at the dates indicated and the results of their operations and their cash flows for the periods indicated, subject to changes resulting from audit and normal year-end adjustments and to the absence of footnotes.

First Testing Date” as defined in Section 5.1(z).

“Fiscal Quarter” means a fiscal quarter of any Fiscal Year.

“Fiscal Year” means the fiscal year of Company and its Subsidiaries ending on March 31 of each calendar year.

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“Flood Certificate” means a “Standard Flood Hazard Determination Form” of the Federal Emergency Management Agency and any successor Governmental Authority performing a similar function.

“Flood Program” means the National Flood Insurance Program created by the U.S. Congress pursuant to the National Flood Insurance Act of 1968, the Flood Disaster Protection Act of 1973, the National Flood Insurance Reform Act of 1994 and the Flood Insurance Reform Act of 2004.

“Flood Zone” means areas having special flood hazards as described in the National Flood Insurance Act of 1968.

Flood Certificate means a “Standard Flood Hazard Determination Form” of the Federal Emergency Management Agency and any successor Governmental Authority performing a similar function.

“Floor” means (a) with respect to Adjusted Term SOFR and any Benchmark Replacement, 1.00% per annum and (b) with respect to the Base Rate, 4.00% per annum.

“Funding Notice” means a notice substantially in the form of Exhibit A.

“GAAP” means, subject to Section 1.2, U.S. generally accepted accounting principles in effect as of the date of determination thereof.

“Goldman Sachs” means Goldman Sachs & Co. LLC.

“Governmental Authority” means any federal, state, municipal, national or other government, governmental department, commission, board, bureau, court, agency or instrumentality or political subdivision thereof or any entity or officer exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to any government or any court, in each case whether associated with a state of the U.S., the U.S., or a foreign entity or government.

“Governmental Authorization” means any permit, license, authorization, plan, directive, consent order or consent decree of or from any Governmental Authority, including each of the Orders.

“Grantor” as defined in the Pledge and Security Agreement.

“Guaranteed Obligations” as defined in Section 7.1.

“Guarantor” means (a) Company, to the extent that Company is not already the primary obligor in respect of any Obligations, (b) each Subsidiary of Company listed on Schedule 1.1(c) and (c) each other Person that guarantees, pursuant to Section 5.10, Section 7.1 or otherwise, all or any part of the Obligations.

“Guarantor Subsidiary” means each Guarantor (other than Company).

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“Guaranty” means (a) the guaranty of each Guarantor set forth in Section 7, and (b) each other guaranty of the Obligations that is made by any other Guarantor in favor of Collateral Agent for the benefit of Secured Parties.

“Hazardous Materials” means any chemical, material or substance, exposure to which is prohibited, limited or regulated by any Governmental Authority or that may or could pose a hazard to the health and safety of the owners, occupants or any Persons in the vicinity of any Facility or to the indoor or outdoor environment.

“Hazardous Materials Activity” means any past, current, proposed or threatened activity, event or occurrence involving any Hazardous Materials, including the use, manufacture, possession, storage, holding, presence, existence, location, Release, threatened Release, discharge, placement, generation, transportation, processing, construction, treatment, abatement, removal, remediation, disposal, disposition or handling of any Hazardous Materials, and any corrective action or response action with respect to any of the foregoing.

“Hedge Agreement” means any Interest Rate Agreement, any Currency Agreement, and any other derivative or hedging contract, agreement, confirmation, or other similar transaction or arrangement that is entered into by Company or any of its Subsidiaries, including any commodity or equity exchange, swap, collar, cap, floor, adjustable strike cap, adjustable strike corridor, cross-currency swap or forward rate agreement, spot or forward foreign currency or commodity purchase or sale, listed or over-the-counter option or similar derivative right related to any of the foregoing, non-deliverable forward or option, foreign currency swap agreement, currency exchange rate price hedging arrangement, or other arrangement designed to protect against fluctuations in interest rates or currency exchange rates, commodity, currency, or Securities values, or any combination of the foregoing agreements or arrangements.

“Highest Lawful Rate” means the maximum lawful interest rate, if any, that at any time or from time to time may be contracted for, charged, or received under the laws applicable to Purchaser that are in effect as of the Closing Date or, to the extent allowed by law, under such applicable laws that may be in effect after the Closing Date and allow a higher maximum nonusurious interest rate than applicable laws in effect as of the Closing Date.

“Historical Financial Statements” means as of the Closing Date, the most recent financial statements delivered to the Pre-Petition Purchasers under Sections 5.1(a), 5.1(b) and 5.1(c) of the Pre-Petition Credit Agreement.

Home Page” means the Company’s corporate home page on the World Wide Web accessible through the Internet via the universal resource locator (URL) identified as http://www.capstoneturbine.com or such other universal resource locator that it shall designate in writing to the Purchaser as its corporate home page on the World Wide Web.

“Immaterial Fee-Owned Properties” means, as of any date of determination, any individual fee-owned Real Estate Asset having a fair market value less than $1,000,000; provided that, notwithstanding the foregoing, (a) if at any time Company and its subsidiaries own, in the aggregate, multiple fee-owned Real Estate Assets that, in the aggregate, have a fair market value in excess of $2,500,000, then Company shall notify Purchaser thereof and Purchaser shall have

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the option, exercisable in its sole discretion, to designate any such Real Estate Assets as Material Real Estate Assets, and (b) any fee-owned Real Estate Asset designated as a Material Real Estate Asset pursuant to clause (iii) of the definition thereof and any fee-owned Real Estate Asset set forth on Schedule 1.1(b) shall not constitute “Immaterial Fee-Owned Properties”.

“Indebtedness” as applied to any Person, means, without duplication, (i) all indebtedness for borrowed money; (ii) Capital Lease Obligations; (iii) notes payable and drafts accepted representing extensions of credit whether or not representing obligations for borrowed money; (iv) any obligation owed for all or any part of the deferred purchase price of property or services (excluding any such obligations incurred under ERISA or any trade payable incurred in the ordinary course of business unless (a) more than forty-five (45) days past due, or (b) such obligation is evidenced by a note or a similar written instrument), including any Earn Out Obligations and Seller Financing Indebtedness; (v) all indebtedness secured by any Lien on any property or asset owned or held by that Person regardless of whether the indebtedness secured thereby shall have been assumed by that Person or is nonrecourse to the credit of that Person; (vi) the face amount of any letter of credit or similar instrument issued for the account of (or similar credit transaction entered into for the benefit of) that Person or as to which that Person is otherwise liable for reimbursement of drawings or is otherwise an obligor; (vii) Disqualified Capital Stock, with the amount of Indebtedness represented by such Disqualified Capital Stock being equal to the greater of its voluntary or involuntary liquidation preference and its maximum fixed repurchase price (for purposes hereof, the “maximum fixed repurchase price” of any Disqualified Capital Stock that does not have a fixed repurchase price shall be calculated in accordance with the terms of such Disqualified Capital Stock as if such Disqualified Capital Stock were purchased on any date on which Indebtedness shall be required to be determined pursuant to this Agreement, and as if such price were based upon, or measured by, the fair market value of such Disqualified Capital Stock); (viii) the direct or indirect guaranty, endorsement (otherwise than for collection or deposit in the ordinary course of business), co-making, discounting with recourse or sale with recourse by such Person of the obligation of another; (ix) any obligation of such Person the primary purpose or intent of which is to provide assurance to an obligee that the obligation of the obligor thereof will be paid or discharged, or any agreement relating thereto will be complied with, or the holders thereof will be protected (in whole or in part) against loss in respect thereof; (x) any liability of such Person for an obligation of another through any agreement (contingent or otherwise) (a) to purchase, repurchase or otherwise acquire such obligation or provide any security therefor, or to provide funds for the payment or discharge of such obligation (whether in the form of loans, advances, stock purchases, capital contributions or otherwise) or (b) to maintain the solvency or any balance sheet item, level of income or financial condition of another if, in the case of any agreement described under subclauses (a) or (b) of this clause (x), the primary purpose or intent thereof is as described in clause (ix) above; and (xi) all obligations of such Person in respect of any exchange traded or over the counter derivative transaction, including under any Hedge Agreement, in each case whether entered into for hedging or speculative purposes or otherwise, provided, the “principal” amount of obligations under any Hedge Agreement that has not been terminated shall be deemed to be the Net Mark-to-Market Exposure of Company and its subsidiaries thereunder.

“Indemnified Liabilities” means, collectively, any and all liabilities, obligations, losses, damages (including natural resource damages), penalties, claims (including Environmental Claims), actions, judgments, suits, costs (including the costs of any investigation, study, sampling,

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testing, abatement, cleanup, removal, remediation or other response action necessary to remove, remediate, clean up or abate any Hazardous Materials Activity), Taxes, expenses and disbursements of any kind or nature whatsoever (including attorneys’ fees and any fees or expenses incurred by Indemnitees in enforcing this indemnity), whether direct, indirect, special, or consequential and whether based on any federal, state or foreign laws, statutes, rules or regulations (including securities and commercial laws, statutes, rules or regulations and Environmental Laws), on common law or equitable cause or on contract or otherwise, that may be imposed on, incurred by, or asserted against any such Indemnitee, in any manner relating to or arising out of (i) this Agreement or the other DIP Note Documents or the transactions contemplated hereby or thereby (including the Purchaser’s agreement to purchase any DIP Notes or the use or intended use of the proceeds thereof, or any enforcement of any of the DIP Note Documents (including any sale of, collection from, or other realization upon any of the Collateral or the enforcement of the Guaranty)); (ii) any Environmental Claim or Hazardous Materials Activity relating to or arising from, directly or indirectly, any past or present activity, operation, land ownership, or practice of Company or any of its Subsidiaries and/or (iii) the Chapter 11 Cases.

“Indemnitee” means, each of Collateral Agent, Purchaser and Pre-Petition Purchasers, and each of their respective shareholders, principals, advisors, subsidiaries, affiliates, officers, partners, members, Directors, trustees, employees, agents and sub-agents.

“Indemnitee Agent Party” as defined in Section 9.6.

Insolvency Proceeding” means, with respect to any DIP Note Party, any (a) case, action or proceeding before any court of Governmental Authority relating to bankruptcy, reorganization, insolvency, liquidation, receivership, dissolution, winding-up or relief of debtors, (b) general assignment for the benefits of creditors, composition, marshaling of assets for creditors, or (c) similar arrangement in respect of creditors generally or any substantial portion of applicable creditors, in any case , under taken under U.S. federal, state or foreign law.

“Intellectual Property” as defined in the Pledge and Security Agreement.

“Intercompany Note” means a “global” intercompany promissory note and subordination that evidences and subordinates certain Indebtedness and other monetary liabilities owed among DIP Note Parties and their Subsidiaries, substantially in the form of Exhibit I.

“Interest Payment Date” means with respect to (i) any Base Rate DIP Note (a) the last day of each month, commencing on the Closing Date and (b) the final maturity date of such DIP Notes; and (ii) any SOFR Rate DIP Note, the last day of each Interest Period applicable to such DIP Note; provided, in the case of each Interest Period of longer than six months “Interest Payment Date” shall also include each date that is three months, or an integral multiple thereof, after the commencement of such Interest Period.

“Interest Period” means, in connection with any SOFR Rate DIP Note, an interest period of one-, three- or six-months, (in each case, subject to the availability thereof) as selected by Company in the applicable Funding Notice, commencing on October 2, 2023; and thereafter, commencing on (and including) the day on which the immediately preceding Interest Period expires; provided, (a) if an Interest Period would otherwise expire on a day that is not a Business

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Day, such Interest Period shall expire on the next Business Day unless no further Business Day occurs in such month, in which case such Interest Period shall expire on the immediately preceding Business Day; (b) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month at the end of such Interest Period) shall end on the last Business Day of a calendar month and (c) no tenor that has been removed from this definition pursuant to Section 2.17 shall be available for specification in such Funding Notice.

“Interest Rate Agreement” means any interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedging agreement or other similar agreement or arrangement, each of which is (i) for the purpose of hedging the interest rate exposure associated with Company’s and its Subsidiaries’ operations, (ii) approved by Purchaser, and (iii) not for speculative purposes.

“Interest Rate Determination Date” means, with respect to any Interest Period, the date that is two U.S. Government Securities Business Days prior to the first day of such Interest Period.

“Interim Order” means an order approved by the Bankruptcy Court entered prior to the date of the Final Order that authorizes each DIP Note Party’s entry into the DIP Note Documents and the incurrence of the DIP Notes thereunder and grants the Liens and security interests contained herein and therein, which order has not been reversed, vacated, or stayed, and is in form and substance satisfactory to Purchaser.

“Investment” means (i) any direct or indirect purchase or other acquisition by Company or any of its Subsidiaries of, or of a beneficial interest in, any of the Securities of any other Person, including the establishment or other creation of a Subsidiary or any other interest in the Securities of any Person; (ii) any direct or indirect redemption, retirement, purchase or other acquisition for value, by any Subsidiary of Company from any Person, of any Capital Stock of such Person; and (iii) any direct or indirect loan, advance (other than advances to employees for customary moving, entertainment and travel expenses, drawing accounts and similar expenditures in the ordinary course of business and consistent with past practice) or capital contributions by Company or any of its Subsidiaries to any other Person, including all indebtedness and accounts receivable from that other Person that are not current assets or did not arise from sales of inventory to that other Person in the ordinary course of business. The amount of any Investment shall be the original cost of such Investment plus the cost of all additions thereto, without any adjustments for increases or decreases in value, or write-ups, write-downs or write-offs with respect to such Investment.

“Joint Venture” means a joint venture, partnership or other similar arrangement, whether in corporate, partnership or other legal form; provided, in no event shall any Wholly-Owned Subsidiary of any Person be considered to be a “Joint Venture” to which such Person is a party.

“Leasehold Property” means any leasehold interest of any DIP Note Party as lessee under any lease of real property.

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“Lien” means any mortgage, lien (statutory or other), pledge, hypothecation, assignment, preference, priority, security interest, restrictive covenant, easement, encumbrance or charge (including any conditional sale or other title retention agreement, any sale-leaseback, any financing lease or similar transaction having substantially the same economic effect as any of the foregoing, the filing of any financing statement or similar instrument under the Uniform Commercial Code or comparable law of any other jurisdiction, domestic or foreign, and mechanics’, materialmen’s and other similar liens and encumbrances, as well as any option to purchase, right of first refusal, right of first offer or similar right).

Majority-in-Interest” means holders of Company’s Capital Stock accounting for 50% or more of the voting power of all of the Capital Stock of Company.

“Margin Stock” as defined in Regulation U.

“Material Adverse Effect” means a material adverse effect on (i) the business operations, properties, assets or financial condition of Company and its Subsidiaries taken as a whole; (ii) the ability of any DIP Note Party to fully and timely perform its Obligations; (iii) the legality, validity, binding effect, or enforceability against a DIP Note Party of a DIP Note Document to which it is a party; (iv) the validity, perfection or priority of a Lien in favor of Collateral Agent for the benefit of Secured Parties on the Collateral, taken as a whole, or (vi) the rights, remedies and benefits available to, or conferred upon, Collateral Agent, Purchaser or any other Secured Party under any DIP Note Document; provided that the filing and administration of the Chapter 11 Cases shall not constitute a Material Adverse Effect.

“Material Contract” means any and all contracts or other arrangements to which Company or any of its Subsidiaries is a party (other than the DIP Note Documents) for which breach, nonperformance, cancellation or failure to renew could reasonably be expected to have a Material Adverse Effect together with those contracts and arrangements that are otherwise listed on Schedule 4.16.

“Material Indebtedness” means Indebtedness (other than the Obligations) of any one or more of Company and its Subsidiaries with an individual principal amount of $250,000 or more or, solely for purposes of Section 8.1(b), that, collectively with any other Indebtedness in respect of which any relevant default or other specified event has occurred, has an aggregate principal amount (or Swap Termination Value) of $500,000 or more.

“Material Real Estate Asset” means any and all of the following: (i) all fee-owned Real Estate Assets other than any Immaterial Fee-Owned Properties, (ii) any Real Estate Asset that Purchaser determines after the Closing Date, in its sole discretion, to be material to the business, operations, properties, assets, condition (financial or otherwise) or prospects of any of Company and its Subsidiaries and designate in writing to be a “Material Real Estate Asset”, and (iii) any Real Estate Asset listed on Schedule 1.1(b).

Monthly Testing Period” as defined in Section 5.1(z).

Monthly Variance Report Date” as defined in Section 5.1(z).

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

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Mortgage” means a mortgage, dead of trust, or similar instrument in form an substance reasonably acceptable to Collateral Agent.

“Mortgaged Real Estate Documents” means, with respect to each Material Real Estate Asset that is required to be subject to a Mortgage pursuant to this Agreement:

(i)one or more fully executed and notarized Mortgages encumbering such Material Real Estate Asset, in each case in proper form for recording in all appropriate places in all applicable jurisdictions;
(ii)(a) ALTA mortgagee title insurance policies or, solely to the extent that Collateral Agent in its sole discretion waives the requirement for a policy to be issued, unconditional commitments therefor, in each case issued by one or more title companies reasonably satisfactory to Collateral Agent with respect to each Material Real Estate Asset (each, a “Title Policy”), each such Title Policy to be in amounts not less than the fair market value of each Material Real Estate Asset, together with a title report issued by a title company with respect thereto and dated not more than thirty days prior to the date of the applicable Mortgage, (b) copies of all documents listed as exceptions to title or otherwise referred to therein, each in form and substance reasonably satisfactory to Collateral Agent, and (c) evidence satisfactory to Collateral Agent that such DIP Note Party has paid to the title company or to the appropriate Governmental Authorities all expenses and premiums of the title company and all other sums required in connection with the issuance of each Title Policy and all recording and stamp taxes (including mortgage recording and intangible taxes) payable in connection with recording the Mortgages for each such Material Real Estate Asset in the appropriate real estate records;
(iii)(A) a completed Flood Certificate with respect to each such Material Real Estate Asset, which Flood Certificate shall (x) be addressed to Collateral Agent and (y) otherwise comply with the Flood Program and be in form and substance satisfactory to Collateral Agent in its sole discretion; (B) if the Flood Certificate indicates that such Material Real Estate Asset is located in a Flood Zone, Company’s written acknowledgment of receipt of written notification from Collateral Agent (x) as to the existence of such Material Real Estate Asset in a Flood Zone and (y) as to whether the community in which such Material Real Estate Asset is located is participating in the Flood Program; and (C) if such Material Real Estate Asset is located in a Flood Zone and is located in a community that participates in the Flood Program, evidence that Company has obtained a policy of flood insurance that is in compliance with all applicable requirements of the Flood Program or, solely to the extent agreed to by Collateral Agent in its sole discretion, excluded any structures existing in such Flood Zone from any such Mortgage in a manner satisfactory to Collateral Agent in its sole discretion;
(iv)ALTA surveys of such Material Real Estate Asset (other than any Leasehold Property), certified to Collateral Agent and dated not more than thirty days prior to the date of the applicable Mortgage and otherwise in form and substance satisfactory to Collateral Agent in its sole discretion;
(v)an opinion of counsel (which counsel shall be reasonably satisfactory to Collateral Agent) in the state in which such Material Real Estate Asset is located with respect to the enforceability of the form(s) of Mortgage to be recorded in such state and such other matters

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as Collateral Agent may reasonably request, in form and substance reasonably satisfactory to Collateral Agent; and
(vi)reports and other information, in each case in form, scope and substance satisfactory to Purchaser in its sole discretion, regarding environmental matters relating to such Material Real Estate Asset.

“Multiemployer Plan” means any Employee Benefit Plan that is a “multiemployer plan” as defined in Section 3(37) of ERISA.

“NAIC” means The National Association of Insurance Commissioners, and any successor thereto.

“Natural Person” means a natural Person or a holding company, investment vehicle or trust for, or owned and operated for the primary benefit of, a natural Person.

“Net Asset Sale Proceeds” means, with respect to any Asset Sale, an amount equal to:  (i) Cash payments received by Company or any of its Subsidiaries from such Asset Sale (including any Cash received by way of deferred payment pursuant to, or by monetization of, a note receivable or otherwise (including by way of a milestone payment, as applicable), but only as and when so received), minus (ii) any bona fide costs and expenses incurred in connection with such Asset Sale to the extent paid or payable to non-Affiliates, including (a) any income or gains taxes payable by Company or any of its Subsidiaries as a result of any gain recognized in connection with such Asset Sale during the tax period in which the sale occurs and sales, transfer and other similar taxes payable in connection with such Asset Sale, (b) payment of the outstanding principal amount of, premium or penalty, if any, and interest on any Indebtedness that is secured by Permitted Priority Liens (other than Pre-petition Security Interest and Primed Liens) on the stock or assets in question and that is required to be repaid under the terms thereof as a result of such Asset Sale, (c) amounts deposited in escrow pursuant to the terms of the agreement governing such Asset Sale (only to the extent such proceeds remain in escrow) and (d) a reasonable reserve for any indemnification payments (fixed or contingent) attributable to seller’s indemnities and representations and warranties to purchaser in respect of such Asset Sale undertaken by Company or any of its Subsidiaries in connection with such Asset Sale; provided that upon release of any such reserve, the amount released shall be considered Net Asset Sale Proceeds.

“Net Insurance/Condemnation Proceeds” means an amount equal to:  (i) any Cash payments or proceeds received by Company or any of its Subsidiaries (a) under any casualty, business interruption or “key man” insurance policies in respect of any covered loss thereunder, less any applicable taxes payable with respect thereto or (b) as a result of the taking of any assets of Company or any of its Subsidiaries by any Person pursuant to the power of eminent domain, condemnation or otherwise, or pursuant to a sale of any such assets to a purchaser with such power under threat of such a taking, minus (ii) (a) any actual and reasonable costs incurred by Company or any of its Subsidiaries in connection with the adjustment or settlement of any claims of Company or such Subsidiary in respect thereof, and (b) any bona fide costs and expenses incurred in connection with any sale of such assets as referred to in clause (i)(b) of this definition to the extent paid or payable to non-Affiliates, including any income or gains taxes payable by Company

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or any of its Subsidiaries as a result of any gain recognized in connection therewith during the tax period the Cash payments or proceeds are received.

“Net Mark-to-Market Exposure” of a Person means, as of any time of determination, the excess (if any) of all unrealized losses over all unrealized profits of such Person arising from Hedge Agreements or other Indebtedness of the type described in clause (xi) of the definition thereof.  As used in this definition, “unrealized losses” means the fair market value of the cost to such Person of replacing such Hedge Agreement or such other Indebtedness as of the date of determination (assuming the Hedge Agreement or such other Indebtedness were to be terminated as of that date), and “unrealized profits” means the fair market value of the gain to such Person of replacing such Hedge Agreement or such other Indebtedness as of the time of determination (assuming such Hedge Agreement or such other Indebtedness were to be terminated as of that time).

New Money Additional DIP Notes” as defined in Section 2.1(b)(ii).

New Money Commitment” as defined in definition of “Commitment”.

New Money DIP Notes” means the New Money Initial DIP Notes and the New Money Additional DIP Notes.

New Money Initial DIP Notes” as defined in Section 2.1(b)(i).

“Non-U.S. Purchaser” as defined in Section 2.19(c).

“Notice” means a Funding Notice.

“Obligations” means all obligations (whether now existing or hereafter arising, absolute or contingent, joint, several, or independent), including for the avoidance of doubt, the Guaranteed Obligations, of every nature of each DIP Note Party from time to time owed to Collateral Agent, Purchaser or any of them, under any DIP Note Document, whether for principal, interest (including interest that, but for the filing of an Insolvency Proceeding with respect to such DIP Note Party, would have accrued on any Obligation, whether or not a claim is allowed against such DIP Note Party for such interest in the related Insolvency Proceeding), fees, expenses, indemnification or otherwise.

“Obligee Guarantor” as defined in Section 7.7.

“OFAC” means the Office of Foreign Assets Control of the U.S. Department of the Treasury and any successor Governmental Authority.

Operating Lease Liabilities” means (i) prior to the effectiveness of FASB ASC 842 as applied to any Person, all obligations of such Person that are or would be characterized as operating lease obligations of such Person in accordance with GAAP without giving effect to FASB ASC 842, and (ii) after the effective date of FASB ASC 842 as applied to any Person, all operating lease liabilities (within the meaning of FASB ASC 842) of such Person, whether or not such liabilities are required to be capitalized and reflected as a liability on a balance sheet of such Person prepared in accordance with GAAP.

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Orders” means, collectively, the Interim Order and the Final Order.

“Organizational Documents” means (i) with respect to any corporation or company, its certificate, memorandum, or articles of incorporation or organization, and its by-laws, (ii) with respect to any limited partnership, its certificate or declaration of limited partnership and its partnership agreement, (iii) with respect to any general partnership, its partnership agreement, and (iv) with respect to any limited liability company, its articles of organization and its operating agreement.  In the event any term or condition of this Agreement or any other DIP Note Document requires any Organizational Document to be certified by a secretary of state or similar governmental official, the reference to any such “Organizational Document” shall only be to a document of a type customarily certified by such governmental official.

“Other Taxes” means any and all present or future stamp, court, intangible, recording, filing or documentary, excise, property or similar Taxes arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other DIP Note Document.

“Paid in Full” and “Payment in Full” mean, with respect to any or all of the Obligations that each of the following events has occurred, as applicable: (a) the payment or repayment in full in immediately available funds of (i) the principal amount of all outstanding DIP Notes, (ii) all accrued and unpaid interest, fees, premiums or other charges owing in respect of any DIP Note or Commitment or otherwise under any DIP Note Document, and (iii) all accrued and unpaid costs and expenses payable by any DIP Note Party to Collateral Agent or Purchaser pursuant to any DIP Note Document, whether or not demand has been made therefor (limited, in the case of indemnification and reimbursement claims to those claims that have been asserted by any such Person prior to such time), (b) the payment or repayment in full in immediately available funds or all other outstanding Obligations or Guaranteed Obligations other than unasserted contingent indemnification and contingent reimbursement obligations and (c) the termination in writing of all of the Commitments.

“PATRIOT Act” means the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act (Title III of Pub. L. 107-56 (signed into law October 26, 2001).

“PBGC” means the Pension Benefit Guaranty Corporation or any successor thereto.

“Pension Plan” means any Employee Benefit Plan, other than a Multiemployer Plan, that is subject to Section 412 of the Code or Section 302 of ERISA.

“Periodic Term SOFR Determination Day” has the meaning specified in the definition of “Term SOFR”.

“Permitted Liens” means each of the Liens permitted pursuant to Section 6.2.

Permitted Priority Liens” means valid, enforceable, non-avoidable and perfected Liens in existence on the Petition Date (including valid Liens in existence on the Petition

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Date that are perfected after the Petition Date as permitted by Section 546(b) of the Bankruptcy Code).

“Permitted Variances” means, as of each Variance Report Date, aggregate disbursements for operating disbursements of not more than 110% of the aggregate disbursement amounts for such items set forth for such Testing Period in the Approved Budget. “Person” means and includes natural persons, corporations, limited partnerships, general partnerships, limited liability companies, limited liability partnerships, joint stock companies, Joint Ventures, associations, companies, trusts, banks, trust companies, land trusts, business trusts or other organizations, whether or not legal entities, and Governmental Authorities.

Petition Date” as defined in the Recitals hereto.

“Platform” as defined in Section 10.1(b).

“Pledge and Security Agreement” means the Pledge and Security Agreement dated as of the Closing Date, executed by Company and each Guarantor in favor of the Collateral Agent for the benefit of the Secured Parties, as it may be amended, restated, supplemented or otherwise modified from time to time.

Post-Carve-Out Trigger Notice Cap” as defined in the definition of “Carve-Out”.

Pre-Funding Notes” as defined in the Pre-Petition Notes Purchase Agreement.

“Pre-Funding Roll Up DIP Notes” as defined in Section 2.1(a)(ii).

Pre-Petition Collateral” means, collectively, the “Collateral” (as defined in the Pre-Petition Note Purchase Agreement) in existence on the Petition Date and all products and proceeds thereof, in any case, securing the Pre-Petition Obligations.

Pre-Petition Note Documents” as defined in the Recitals hereto.

Pre-Petition Note Purchase Agent” as defined in the Recitals hereto.

Pre-Petition Note Purchase Agreement” as defined in the Recitals hereto.

Pre-Petition Obligations” means all “Obligations” as defined in the Pre-Petition Note Purchase Agreement.

Pre-Petition Obligation Roll Up DIP Notes” as defined in section 2.1(a)(ii).

Pre-Petition Security Interests” means the Liens on and security interests in the Pre-Petition Collateral securing the Pre-Petition Obligations.

Pre-Petition Purchasers” as defined in the Recitals hereto.

“Prime Rate” means the rate of interest quoted in the print edition of The Wall Street Journal, Money Rates Section as the Prime Rate (currently defined as the base rate on

27


corporate loans posted by at least 75% of the nation’s thirty largest banks), as in effect from time to time, or, if such source or rate is unavailable, any replacement or successor source or rate as determined by Purchaser.  The Prime Rate is a reference rate and does not necessarily represent the lowest or best rate actually charged to any customer.  Purchaser may make commercial loans or other loans at rates of interest at, above or below the Prime Rate.

Primed Liens” as defined in Section 2.24(a)(iii).

Professional Persons” as defined in the definition of “Carve-Out”.

“Property” means any interest (including any leasehold or similar interest) in any kind of property or asset, whether real, personal or mixed, or tangible or intangible, including, without limitation, Cash, securities, accounts and contract rights.

“Purchaser” means the financial institution listed on the signature pages hereto as a Purchaser.

Qualified Capital Stock” means any Capital Stock that is not Disqualified Capital Stock.

“Real Estate Asset” means, at any time of determination, any interest (fee, leasehold or otherwise) then owned by any DIP Note Party in any real property.

“Register” as defined in Section 2.6(b).

“Regulation D” means Regulation D of the Board of Governors and all official rulings and interpretations thereunder or thereof.

“Regulation T” means Regulation T of the Board of Governors and all official rulings and interpretations thereunder or thereof.

“Regulation U” means Regulation U of the Board of Governors and all official rulings and interpretations thereunder or thereof.

“Regulation X” means Regulation X of the Board of Governors and all official rulings and interpretations thereunder or thereof.

“Related Parties” means any of the officers, directors, employees, agents, attorneys, representatives, subsidiaries, Affiliates or shareholders of a Person.

“Release” means any release, spill, emission, leaking, pumping, pouring, injection, escaping, deposit, disposal, discharge, dispersal, dumping, leaching or migration of any Hazardous Material into the indoor or outdoor environment (including the abandonment or disposal of any barrels, containers or other closed receptacles containing any Hazardous Material), including the movement of any Hazardous Material through the air, soil, surface water or groundwater.

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“Relevant Governmental Body” means the Federal Reserve Board or the Federal Reserve Bank of New York, or a committee officially endorsed or convened by the Federal Reserve Board or the Federal Reserve Bank of New York, or any successor thereto.

Remedies Notice” as defined in Section 8.1.

Remedies Notice Period” as defined in Section 8.1.

Replacement Liens” as defined in the Interim Order or, following entry of the Final Order, the Final Order.

“Required Prepayment Date” as defined in Section 2.14(c).

“Restricted Junior Payment” means (i) any dividend, other distribution, or liquidation preference, direct or indirect, on account of any shares of any class of Capital Stock of Company or any of its Subsidiaries now or hereafter outstanding, except a dividend payable solely in shares of that class of Capital Stock (other than any Disqualified Capital Stock) to the holders of that class; (ii) any redemption, retirement, sinking fund or similar payment, purchase or other acquisition for value, direct or indirect, of any shares of any class of Capital Stock of Company or any of its Subsidiaries (or any direct or indirect parent thereof) now or hereafter outstanding; (iii) any payment made to retire, or to obtain the surrender of, any outstanding warrants, options or other rights to acquire shares of any class of Capital Stock of Company or any of its Subsidiaries (or any direct or indirect parent thereof) now or hereafter outstanding, excluding any such payment in respect of the Warrants; and (iv) any payment or prepayment of principal of, premium, if any, or interest on, or redemption, purchase, retirement, defeasance (including in-substance or legal defeasance), sinking fund or similar payment with respect to, any Subordinated Indebtedness or any Earn Out Obligations or Seller Financing Indebtedness.

Roll Up Commitment” as defined in the definition of “Commitment”.

Roll Up DIP Notes” as defined in Section 2.1(a)(ii).

“S&P” means S&P Global Ratings, or any successor to its rating agency business.

Sale Transaction” means any transaction pursuant to which (a) Company sells or disposes (in one or a series of related sales or dispositions) of all or substantially all of the assets of Company on a consolidated basis (other than inventory in the ordinary course of business), including any sale or disposition of the securities or assets of the Subsidiaries of Company, (b) Company engages in any merger, consolidation, combination or similar transaction, (in one or a series of related transactions), such that the Majority-in-Interest immediately prior to the transaction or transactions will, immediately after such transaction or transactions, no longer constitute the Majority-in-Interest, or (c) any other transaction constituting a Change of Control.

“Sanctioned Country” means, at any time, a country, territory or region that is, or whose government is, the subject or target of any Sanctions, including, as of the Closing Date, Cuba, Iran, North Korea, Syria, and the Crimea, Donetsk, Kherson, Luhansk, and Zaporizhzhia regions of Ukraine.

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“Sanctioned Person” means, at any time, any Person with whom dealings are restricted or prohibited under Sanctions, including (i) any Person listed in any Sanctions-related list of designated Persons maintained by the U.S. (including by OFAC, the U.S. Department of the Treasury, or the U.S. Department of State), or by the United Nations Security Council, the European Union or any EU member state, His Majesty’s Treasury of the United Kingdom or any other relevant sanctions authority, (ii) any Person located, operating, organized or resident in a Sanctioned Country or (iii) any Person owned or controlled, directly or indirectly, by any such Person described in clause (i) or (ii) of this definition.

“Sanctions” means sanctions or trade embargoes enacted, imposed, administered or enforced from time to time by (i) the U.S. government, including those administered by OFAC, U.S. Department of State, or U.S. Department of Commerce, (ii) the United Nations Security Council, the European Union or any of its member states, His Majesty’s Treasury of the United Kingdom, or (iii) any other relevant sanctions authority.

Scheduled Maturity Date” as defined in definition of “DIP Notes Maturity Date”.

“Section 382 Ownership Shift” means on any day on which Company undergoes an “owner shift”, the aggregate increase in the percentage of Company’s stock owned by each “5-percent shareholder” over the lowest percentage of Company’s stock owned by such shareholder at any time during the “testing period.”  For these purposes, the terms “owner shift,” “5-percent shareholder” and “testing period,” shall have the meanings accorded them under section 382 of the Code, and this clause shall be interpreted consistently with the intent of Company and Purchaser to avoid an “ownership change” of Company, within the meaning of section 382(g)(1) of the Code.  The determination of the size of the Section 382 Ownership Shift shall be made by Purchaser in good faith and in accordance with the principles of the preceding sentence, after reasonable consultation with Company.  

“Secured Parties” as defined in the Pledge and Security Agreement.

“Securities” means any stock, shares, partnership interests, voting trust certificates, certificates of interest or participation in any profit-sharing agreement or arrangement, options, warrants, bonds, debentures, notes, or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as “securities” or any certificates of interest, shares or participations in temporary or interim certificates for the purchase or acquisition of, or any right to subscribe to, purchase or acquire, any of the foregoing, including any Capital Stock and Hedge Agreements or other derivatives.

“Securities Account” means any “securities account” as defined in Article 8 of the UCC and any “commodity account” as defined in Article 9 of the UCC.

“Securities Account Control Agreement” means, with respect to a Securities Account, an agreement in form and substance reasonably satisfactory to Collateral Agent that (i) is entered into among Collateral Agent, the Securities Intermediary at which the applicable Securities Account is maintained, and the DIP Note Party having rights in or to the underlying financial assets credited to or maintained in such Securities Account, and (ii) is effective for

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Collateral Agent to obtain “control” (within the meaning of Articles 8 and 9 of the UCC) of such Securities Account.

“Securities Act” means the Securities Act of 1933, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect.

“Securities Intermediary” means any “securities intermediary” or “commodity intermediary” as such terms are defined in the UCC.

“Seller Financing Indebtedness” means any obligation or liability consisting of fixed deferred purchase price, installment payments, or promissory notes that, in each case, is issued or otherwise incurred as consideration for any acquisition of any property.

“SOFR” means a rate equal to the secured overnight financing rate as administered by the SOFR Administrator.

“SOFR Administrator” means the Federal Reserve Bank of New York (or a successor administrator of the secured overnight financing rate).

“SOFR Rate DIP Note” means a DIP Note that bears interest at a rate determined by reference to Adjusted Term SOFR, other than pursuant to clause (iii) of the definition of “Base Rate.”

“Subordinated Indebtedness” means any Indebtedness that is contractually or structurally subordinated in payment or lien ranking to the Obligations or related Liens.

“Subsidiary” means, with respect to any Person, any corporation, partnership, limited liability company, association, joint venture or other business entity of which more than 50% of the total voting power of shares of stock or other ownership interests entitled (without regard to the occurrence of any contingency) to vote in the election or appointment of the Person or Persons (whether directors, trustees, or other Persons performing similar functions) having the power to direct or cause the direction of the management and policies thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof; provided, in determining the percentage of ownership interests of any Person controlled by another Person, no ownership interest in the nature of a “qualifying share” of the former Person shall be deemed to be outstanding.

Superpriority Claim” as defined in Section 2.24.

“Swap Termination Value” means, in respect of any one or more Hedge Agreements, after taking into account the effect of any legally enforceable netting agreement relating to such Hedge Agreements, (a) for any date on or after the date such Hedge Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s), and (b) for any date prior to the date referenced in clause (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognized dealer in such Hedge Agreements (which may include Purchaser or any Affiliate).

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“Tax” means any present or future tax, levy, impost, duty, assessment, charge, fee, deduction or withholding (together with interest, penalties and other additions thereto) of any nature and whatever called, imposed, levied, collected, withheld or assessed by any Governmental Authority; provided, “Tax on the overall net income” of a Person shall be construed as a reference to a tax imposed on all or part of the overall net income (whether worldwide, or only insofar as such overall net income is considered to arise in or to relate to a particular jurisdiction, or otherwise), a franchise Tax, and a branch profits Tax of that Person (and/or, in the case of Purchaser, its applicable investment office) by the jurisdiction in which that Person is organized or in which that Person’s applicable principal office (and/or, in the case of Purchaser, its investment office) is located.

Term SOFR” means,

a)for any calculation with respect to a SOFR Rate DIP Note, the Term SOFR Reference Rate for a tenor comparable to the applicable Interest Period on the day (such day, the “Periodic Term SOFR Determination Day”) that is two (2) U.S. Government Securities Business Days prior to the first day of such Interest Period, as such rate is published by the Term SOFR Administrator; provided, however, that if as of 5:00 p.m. (New York City time) on any Periodic Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Periodic Term SOFR Determination Day, and
b)for any calculation with respect to a Base Rate DIP Note on any day, the Term SOFR Reference Rate for a tenor of one month on the day (such day, the “Base Rate Term SOFR Determination Day”) that is two (2) U.S. Government Securities Business Days prior to such day, as such rate is published by the Term SOFR Administrator; provided, however, that if as of 5:00 p.m. (New York City time) on any Base Rate Term SOFR Determination Day the Term SOFR Reference Rate for the applicable tenor has not been published by the Term SOFR Administrator and a Benchmark Replacement Date with respect to the Term SOFR Reference Rate has not occurred, then Term SOFR will be the Term SOFR Reference Rate for such tenor as published by the Term SOFR Administrator on the first preceding U.S. Government Securities Business Day for which such Term SOFR Reference Rate for such tenor was published by the Term SOFR Administrator so long as such first preceding U.S. Government Securities Business Day is not more than three (3) U.S. Government Securities Business Days prior to such Base Rate Term SOFR Determination Day; provided, further, that if Term SOFR determined as provided above (including pursuant to the proviso under clause (a) or clause (b) above) shall ever be less than the Floor, then Term SOFR shall be deemed to be the Floor.

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“Term SOFR Adjustment” means, for any calculation with respect to a Base Rate DIP Note or SOFR Rate DIP Note, a percentage per annum as set forth below for the applicable type of such DIP Note and (if applicable) Interest Period therefor:

Base Rate DIP Notes:

0.11448%

SOFR Rate DIP Notes:

Interest Period

Percentage

One Month

0.11448%

Three Months

0.26161%

Six Months

0.42826%

“Term SOFR Administrator” means CME Group Benchmark Administration Limited (CBA) (or a successor administrator of the Term SOFR Reference Rate selected by BSCH in its reasonable discretion).

“Term SOFR Reference Rate” means the forward-looking term rate based on SOFR.

Testing Date” as defined in Section 5.1(z).

Testing Period” means a Weekly Testing Period or a Monthly Testing Period, as applicable.

Title Policy” as defined in the definition of Mortgaged Real Estate Documents.

TSA” means that certain Transaction Support Agreement, dated September 28, 2023 by and among the Debtors on the one hand and Purchaser, on the other hand, as amended, restated, amended and restated or otherwise modified from time to time in accordance therewith.

“UCC” means the Uniform Commercial Code (or any similar or equivalent statute or law) as in effect in any applicable jurisdiction.

“Unadjusted Benchmark Replacement” means the applicable Benchmark Replacement excluding the related Benchmark Replacement Adjustment.

U.S. means the United States of America.

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“U.S. Government Securities Business Day” means any day except for (a) a Saturday, (b) a Sunday or (c) a day on which the Securities Industry and Financial Markets Association recommends that the fixed income departments of its members be closed for the entire day for purposes of trading in United States government securities.

“U.S. Purchaser” as defined in Section 2.19(c).

“U.S. Tax Compliance Certificate” means a certificate substantially in the form of one of Exhibits E-1, E-2, E-3 or E-4, as applicable.

U.S. Trustee” means the Office of the United States Trustee for the District of Delaware.

Variance Report Dates” as defined in Section 5.1(aa).

“Waivable Mandatory Prepayment” as defined in Section 2.14(c).

“WARN” as defined in Section 4.19.

“Warrant Holder” means Goldman Sachs & Co. LLC.

“Warrants” means, collectively, that certain Purchase Warrant for Common Shares, dated as of February 4, 2019, as defined in the Pre-Petition Note Purchase Agreement, issued by Company to the Warrant Holder.

Weekly Variance Report Date” as defined in Section 5.1(z).

Wholly-Owned means, in reference to any Subsidiary of a specified Person, that 100% of the Capital Stock of such Subsidiary (other than (x) Directors’ qualifying shares and (y) shares issued to foreign nationals to the extent required by applicable law) is owned, directly or indirectly, by such Person and/or one or more of such specified Person’s other Subsidiaries that also qualify as Wholly-Owned Subsidiaries under this definition.

1.2Accounting Terms, Financials Statements, Calculations, Etc.  Except as otherwise expressly provided herein, all accounting terms not otherwise defined herein shall have the meanings assigned to them in conformity with GAAP.  Financial statements and other information required to be delivered by Company to Purchaser pursuant to Section 5.1(a), 5.1(b) and 5.1(c) shall be prepared in accordance with GAAP as in effect at the time of such preparation. Subject to the foregoing, calculations in connection with the definitions, covenants and other provisions hereof shall utilize accounting principles and policies in conformity with those used to prepare the Historical Financial Statements.  For purposes of determining pro forma compliance with any financial covenant as of any date prior to the initial test date on which such financial covenant is to be tested hereunder, the level of any such financial covenant shall be deemed to be the covenant level for such initial test date.  Notwithstanding anything to the contrary in this Agreement, for purposes of determining compliance with any basket, test, or condition under any provision of this Agreement or any other DIP Note Document, no DIP Note Party may retroactively divide, classify, re-classify or deem or otherwise treat a historical transaction as having occurred in reliance on a basket or exception that was not available at the time of such

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historical transaction or if and to the extent that such basket or exception was relied upon for any later transaction.  Notwithstanding any other provision contained herein and any change in GAAP after the date hereof, any lease that would be treated as an operating lease for purposes of GAAP as of the Closing Date (whether such lease is entered into before or after the Closing Date) shall continue to be treated as an operating lease and shall not constitute Indebtedness or a Capital Lease Obligation of Company or any Subsidiary under this Agreement and the other DIP Note Documents.  When used herein, the term “financial statements” shall be construed to include all notes and schedules thereto.  Whenever the term “Company” is used in respect of a financial covenant or a related definition, it shall be construed to mean “Company and its Subsidiaries on a consolidated basis” unless the context clearly requires otherwise.  Except as otherwise provided therein, this Section 1.2 shall apply equally to each other DIP Note Document as if fully set forth therein, mutatis mutandis.

1.3Interpretation, Etc.  Any of the terms defined herein may, unless the context otherwise requires, be used in the singular or the plural, depending on the reference.  References herein to any Section, Appendix, Schedule or Exhibit shall be to a Section, an Appendix, a Schedule or an Exhibit, as the case may be, hereof unless otherwise specifically provided.  Any requirement for a referenced agreement, instrument, certificate or other document to be in “substantially” the form of an Appendix, Schedule, or Exhibit hereto means that such referenced document shall be in the form of such Appendix, Schedule, or Exhibit with such modifications to such form as are approved by Purchaser, and, in the case of any Collateral Document, Collateral Agent, in each case in Collateral Agent’s sole discretion.  The words “hereof”, “hereunder”, “hereby”, and words of similar import used in this Agreement refer to this Agreement as a whole and not to any particular provision of this Agreement.  The use herein of the words “include” or “including,” when following any general statement, term or matter, shall not be construed to limit such statement, term or matter to the specific items or matters set forth immediately following such word or to similar items or matters, whether or not non-limiting language (such as “without limitation” or “but not limited to” or words of similar import) is used with reference thereto, but rather shall be deemed to refer to all other items or matters that fall within the broadest possible scope of such general statement, term or matter.  The use herein of the words “continuing”, “continuance”, “existing”, or any words of similar import or derivatives of any such words in reference to any Event of Default means that such Event of Default has not been expressly waived.  The word “will” shall be construed as having the same meaning and effect as the word “shall”.  The words “assets” and “property” shall be construed as having the same meaning and effect and to refer to any and all tangible and intangible assets and properties of any relevant Person or Persons.  The terms lease and license shall be construed to include sub-lease and sub-license.  Whenever the context may require, any pronoun shall be construed to include the corresponding masculine, feminine, and neuter forms.  References to Persons include their respective permitted successors and assigns.  Except as otherwise expressly provided herein, references to statutes, legislative acts, laws, regulations, and rules shall be deemed to refer to such statutes, acts, laws, regulations, and rules as in effect from time to time, including any amendments of the same and any successor statutes, acts, laws, regulations, and rules, unless any such reference is expressly limited to refer to any statute, act, law, regulation, or rule “as in effect on” a specified date.  Except as otherwise expressly provided herein, any reference in or to this Agreement (including any Appendix, Schedule, or Exhibit hereto), any other DIP Note Document, or any other agreement, instrument, or other document shall be construed to refer to the referenced agreement, instrument, or document as assigned, amended, restated, supplemented, or otherwise modified from time to

35


time, in each case in accordance with the express terms of this Agreement and any other relevant DIP Note Document unless such reference is expressly limited to refer to such agreement, instrument, or other document “as in effect on” a specified date.  Unless otherwise expressly stated, if a Person may not take an action under this Agreement, then it may not take that action indirectly, or take any action assisting or supporting any other Person in taking that action directly or indirectly. “Taking an action indirectly” means taking an action that is not expressly prohibited for the Person but is intended to have substantially the same effects as the prohibited action.  Except as otherwise provided therein, this Section 1.3 shall apply equally to each other DIP Note Document as if fully set forth therein, mutatis mutandis.

1.4Rates. Collateral Agent does not warrant or accept responsibility for, and shall not have any liability with respect to (a) the continuation of, administration of, submission of, calculation of or any other matter related to the Base Rate, the Term SOFR Reference Rate, Adjusted Term SOFR or Term SOFR, or any component definition thereof or rates referred to in the definition thereof, or any alternative, successor or replacement rate thereto (including any Benchmark Replacement), including whether the composition or characteristics of any such alternative, successor or replacement rate (including any Benchmark Replacement) will be similar to, or produce the same value or economic equivalence of, or have the same volume or liquidity as, the Base Rate, the Term SOFR Reference Rate, Adjusted Term SOFR, Term SOFR or any other Benchmark prior to its discontinuance or unavailability, or (b) the effect, implementation or composition of any Conforming Changes.  Collateral Agent and its Affiliates or other related entities may engage in transactions that affect the calculation of the Base Rate, the Term SOFR Reference Rate, Term SOFR, Adjusted Term SOFR, any alternative, successor or replacement rate (including any Benchmark Replacement) or any relevant adjustments thereto, in each case, in a manner adverse to the DIP Note Parties.  Collateral Agent may select information sources or services in its reasonable discretion to ascertain the Base Rate, the Term SOFR Reference Rate, Term SOFR, Adjusted Term SOFR or any other Benchmark, in each case, pursuant to the terms of this Agreement, and shall have no liability to any DIP Note Party, Purchaser or any other Person or entity for damages of any kind, including direct or indirect, special, punitive, incidental or consequential damages, costs, losses or expenses (whether in tort, contract or otherwise and whether at law or in equity), for any error or calculation of any such rate (or component thereof) provided by any such information source or service.
1.5Rate and Fee Basis. All per annum rates shall be calculated on the basis of a year of 360 days for actual days elapsed.
Section 2DIP NOTES
2.1Issuance and Purchase of the DIP Notes.
(a)Authorization of DIP Notes.
(i)The Company will authorize the issue and sale of $30,000,000 Super-Priority Senior Secured Debtor-in-Possession Notes due on the DIP Notes Maturity Date.

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(ii)On the Closing Date, subject to the terms and conditions hereof (including the entry and terms of the Orders and the satisfaction of the other applicable conditions precedent set forth in Section 3) and for the limited purposes set forth herein, Pre-Funding Notes in an aggregate principal amount of $3,000,000 owed to the Pre-Petition Purchaser shall be rolled-up and deemed to be DIP Notes (the “Pre-Funding Roll Up DIP Notes”) and $15,000,000 of other Pre-Petition Obligations owed to the Pre-Petition Purchaser shall be rolled-up and deemed to be DIP Notes (the “Pre-Petition Obligation Roll Up DIP Notes” and together with the “Pre-Funding Roll Up DIP Notes, “Roll Up DIP Notes”) issued by the Company to the Purchaser, and purchased by the Purchaser hereunder in respect of the Purchaser's Roll Up Commitment.
(b)Commitments; Purchase and Sale of the DIP Notes.  Subject to the terms and conditions hereof (including the entry and terms of the Orders and the satisfaction of the other applicable conditions precedent set forth in Section 3),
(i)on the Closing Date, Company agrees that it will issue and sell to Purchaser, and Purchaser agrees that it will purchase from Company, DIP Notes in an aggregate original principal amount equal to $9,000,000 of Purchaser’s New Money Commitment (the “New Money Initial DIP Notes”); and
(ii)on any Additional DIP Notes Closing Date, Company agrees that it will issue and sell to Purchaser, and Purchaser agrees that it will purchase from Company, DIP Notes in an aggregate original principal amount up to Purchaser's New Money Commitment less the amount of New Money Initial DIP Notes purchased by Purchaser (the “New Money Additional DIP Notes”).
(c)Each DIP Note shall be in substantially the form of Super-Priority Senior Secured Debtor-in-Possession Note attached hereto as Exhibit J-1 or Exhibit J-2, as applicable, appropriately completed in conformity herewith, the purchase price for which shall be such original principal amount.

Subject to Section 2.13, all amounts owed hereunder shall be Paid in Full no later than the DIP Notes Maturity Date.  

(d)Funding Mechanics.  For the Roll Up DIP Notes and the New Money Initial DIP Notes, Company shall deliver to Purchaser a fully executed Funding Notice no later than 10:00 a.m. (New York City time) at least one Business Day prior to the Closing Date (or such later time as may be consented to by Purchaser). For the New Money Additional DIP Notes, Company shall deliver to Purchaser a fully executed Funding Notice no later than 10:00 a.m. (New York City time) at least three (3) Business Days prior to the Closing Date (or such later time as may be consented to by Purchaser) in the case of A SOFR Rate DIP Note and at least one Business Day prior to the Closing Date (or such later time as may be consented to by Purchaser) in the case of a Base Rate DIP Note.
(e)[Reserved].
(f)In no event shall Company request the purchase of, and Purchaser shall not be required to purchase, any DIP Note (whether under Section 2.1(a)(i) or Section 2.1(a)(ii)) in an

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aggregate principal amount greater than the amount approved by the Bankruptcy Court pursuant to the Interim Order or, when applicable, the Final Order.
2.2 Issuance of the DIP Notes.  The DIP Notes will be delivered to Purchaser in physical form and shall be issued in its name or the name of its nominee on the Closing Date or date of purchase, as applicable. Each of Purchaser’s New Money Commitment and Roll Up Commitment shall (x) automatically and permanently be reduced by the amount of each applicable DIP Note issued hereunder, and (y) terminate immediately and without further action by any Person on the DIP Notes Maturity Date. Subject to Section ‎2.13, all amounts owed hereunder with respect to the DIP Notes shall be Paid in Full no later than the DIP Notes Maturity Date.
2.3[Reserved].
2.4[Reserved].
2.5Use of Proceeds.  
(a)The Company shall use the proceeds of the DIP Notes for only the following purposes, in each case, in accordance with (i) the Orders and (ii) the Approved Budget (subject to the Permitted Variances): (A) for working capital and general corporate purposes of the Debtors, (B) to pay interest, premiums, fees and expenses payable hereunder and under the other DIP Note Documents, (C) to pay administration and restructuring costs and professional fees and expenses of the Debtors related solely to the Chapter 11 Cases, (D) to pay the transaction costs associated with the execution of the DIP Note Documents, including but not limited to the costs and expenses pursuant to Section 10.2, (E) solely with respect to the Roll Up DIP Notes, to effectuate the roll-up of Pre-Petition Obligations under Section 2.1(a)(ii) and (F) to make adequate protection payments as set forth in the Orders.
(b)Notwithstanding anything to the contrary in this Agreement, no proceeds of the DIP Notes or the Carve-Out may be used by any DIP Note Party in any manner to:
(i)request authorization to obtain post-petition loans or other financial accommodations pursuant to Section 364(c) or (d) of the Bankruptcy Code or otherwise, other than from the Collateral Agent or Purchaser, unless the proceeds of such loans or accommodations are or will be sufficient, and will be used, to indefeasibly pay in full in Cash all Obligations, the Pre-Petition Obligations;
(ii)pay any expenses, other than the amounts set forth in the Approved Budget (subject to the Permitted Variances) or the Carve-Out;
(iii)object, contest or raise any defense to the validity, perfection, priority, extent or enforceability of any amount due under, or the Liens or security interests granted under, the DIP Note Documents or Pre-Petition Note Documents;
(iv)investigate, initiate, assert, join or prosecute any claims or defenses or commence any cause of action against (A) Collateral Agent, Purchaser or any of their respective Related Parties under or relating to this Agreement or any other DIP Note

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Document or (B) the Pre-Petition Note Purchase Agent, the Pre-Petition Purchaser or any of their respective Related Parties under or relating to the Pre-Petition Note Documents;
(v)prevent, hinder or delay, whether directly or indirectly, Collateral Agent’s assertion or enforcement of its Liens on the Collateral, or its efforts to realize upon any Collateral under the DIP Note Documents or exercise any other rights and remedies under the DIP Note Documents or applicable law;
(vi)other than to the extent authorized by the Bankruptcy Court and as set forth in the Approved Budget (subject to the Permitted Variances), pay any claim of any creditor in the Chapter 11 Cases without the prior written consent of Purchaser; or
(vii)sell or otherwise dispose of Collateral, unless otherwise permitted by the Orders or by this Agreement, without the consent of  Purchaser.
(c)No portion of the proceeds of any DIP Notes shall be used in any manner that causes or might cause such DIP Notes or the application of such proceeds to violate Regulation T, Regulation U or Regulation X of the Board of Governors of the Federal Reserve System, as in effect from time to time, or any other regulation thereof or to violate the Exchange Act.
2.6Evidence of Debt; Register; Replacement of DIP Notes.
(a)Purchaser’s Evidence of Debt.  Purchaser shall maintain on its internal records an account or accounts evidencing the Obligations of Company to Purchaser, including the amounts of the DIP Notes held by it and each repayment and prepayment in respect thereof.  Any such recordation shall be conclusive and binding on Company, absent manifest error; provided, that the failure to make any such recordation, or any error in such recordation, shall not affect Company’s Obligations in respect of any applicable DIP Notes; and provided further, in the event of any inconsistency between the Register and Purchaser’s records, the recordations in the Register shall govern.
(b)Register.  Company(or an agent or sub-agent appointed by it) shall maintain at its principal executive office a register for the recordation of the names and addresses of Purchaser and principal amounts (and stated interest) of the DIP Notes owing to, Purchaser pursuant to the terms hereof from time to time (the “Register”).  The Register shall be available for inspection by Purchaser (with respect to (i) any entry relating to Purchaser’s DIP Notes) any reasonable time and from time to time upon reasonable prior notice.  Company shall record, or shall cause to be recorded, in the Register the DIP Notes in accordance with the provisions of Section 10.6, and each repayment or prepayment in respect of the principal amount of the DIP Notes; provided, failure to make any such recordation, or any error in such recordation, shall not affect Company’s Obligations in respect of any DIP Note.  
(c)Replacement of DIP Notes.  Upon receipt by Company of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any DIP Note, and (x) in the case of loss, theft or destruction, of indemnity reasonably satisfactory to it (provided that if the holder of such DIP Note is, or is a nominee for, Purchaser party hereto on the Closing Date, such Person's own unsecured agreement of indemnity shall be deemed to be

39


satisfactory), or (y) in the case of mutilation, upon surrender and cancellation thereof, within ten Business Days thereafter Company at its own expense shall execute and deliver, in lieu thereof, a new DIP Note to Purchaser, dated and bearing interest from the date to which interest shall have been paid on such lost, stolen, destroyed or mutilated DIP Note or dated the date of such lost, stolen, destroyed or mutilated DIP Note if no interest shall have been paid thereon.
2.7Interest on DIP Notes.
(a)Except as otherwise set forth herein, each DIP Note shall bear interest on the unpaid principal amount thereof from the date issued and sold through the date of repayment (whether by acceleration or otherwise) thereof as follows:
(i)if a Base Rate DIP Note, at the Base Rate plus the Applicable Margin; or
(ii)if a SOFR Rate DIP Note, at the Adjusted Term SOFR for the Interest Period therefor plus the Applicable Margin;
(b)The basis for determining the rate of interest with respect to any DIP Note, and the Interest Period with respect to any SOFR Rate DIP Note shall be selected by Company and notified to Collateral Agent and Purchaser pursuant to the applicable Funding Notice.
(c)In connection with SOFR Rate DIP Notes, there shall be no more than three Interest Periods outstanding at any time. In the event Company fails to specify between a Base Rate DIP Note or a SOFR Rate DIP Note in the applicable Funding Notice, such DIP Note (if outstanding as a SOFR Rate DIP Note) will be automatically continued as a SOFR Rate DIP Note with a one-month Interest Period on the last day of the then current Interest Period for such DIP Note (or if outstanding as a Base Rate DIP Note will remain as, or (if not then outstanding) will be made as, a SOFR Rate DIP Note with a one-month Interest Period). In the event Company fails to specify an Interest Period for any SOFR Rate DIP Note in the applicable Funding Notice, (or fails to deliver a Funding Notice at the end of an Interest Period), Company shall be deemed to have selected an Interest Period of one month.  As soon as practicable after 10:00 a.m. (New York City time) on each Interest Rate Determination Date, Collateral Agent shall determine (which determination shall, absent manifest error, be final, conclusive and binding upon all parties) the interest rate that shall apply to the SOFR Rate DIP Notes for which an interest rate is then being determined for the applicable Interest Period and will promptly give notice thereof to Company and Purchaser.
(d)Interest payable pursuant to Section 2.7(a) shall be computed on the basis of a three hundred sixty-day year, in each case for the actual number of days elapsed in the period during which it accrues.  In computing interest on any DIP Note, the date of the issuance and sale of such DIP Note or the Interest Payment Date, or with respect to a Base Rate DIP Note being converted from a SOFR Rate DIP Note, the date of conversion of such SOFR Rate DIP Note to such Base Rate DIP Note, as the case may be shall be included, and the date of payment of such DIP Note or the expiration date of an Interest Period applicable to such DIP Note or, with respect to a Base Rate DIP Note being converted to a SOFR Rate DIP Note, the date of conversion of such Base Rate DIP Note to such SOFR Rate DIP Note, as the case may be, shall be excluded; provided,

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if a DIP Note is repaid on the same day on which it is made, one day’s interest shall be paid on that DIP Note.
(e)Except as otherwise set forth herein, interest on each DIP Note (i) shall accrue on a daily basis and shall be paid in kind by capitalizing the amount of such interest accrued and adding such accrued amounts to the principal balance of the New Money DIP Notes (ratably among the New Money DIP Notes held by Purchaser) (the principal amount of the DIP Notes arising as a result of the capitalization of interest pursuant to this sentence, being referred to herein as “PIK Principal”), on each Interest Payment Date with respect to interest accrued on and to each such Interest Payment Date; (ii) shall accrue on a daily basis and shall be payable in Cash in arrears upon any prepayment of that DIP Note, whether voluntary or mandatory, to the extent accrued on the amount being prepaid; and (iii) shall accrue on a daily basis and shall be payable in Cash in arrears at maturity of the DIP Notes, including final maturity of the DIP Notes. For the avoidance of doubt, PIK Principal shall thereafter constitute principal and bear interest in accordance with Section 2.7(a) and otherwise be treated as DIP Notes for purposes of this Agreement. Any reference in this Agreement or any DIP Note Document to the DIP Notes or the outstanding principal balance of the DIP Notes shall include all PIK Principal that has not been repaid or prepaid in accordance with the terms of this Agreement. For the avoidance of doubt, PIK Principal shall be pari passu with and shall constitute a portion of the DIP Notes for all purposes hereunder or under any other DIP Note Document, and the outstanding principal balance of PIK Principal shall be due and payable in Cash on the DIP Note Maturity Date (unless otherwise agreed to in writing by Purchaser).
(f)Term SOFR Conforming Changes. In connection with the use or administration of Term SOFR, the Collateral Agent will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other DIP Note Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other DIP Note Document. The Collateral Agent will promptly notify the Company and Purchaser of the effectiveness of any Conforming Changes in connection with the use or administration of Term SOFR  
2.8[Reserved]
2.9Default Interest.  Upon the occurrence and during the continuance of an Event of Default, (a) the principal amount of all Base Rate DIP Notes outstanding and, to the extent permitted by applicable law, any interest payments on such Base Rate DIP Notes, and any fees or other amounts (other than the principal amount of the SOFR Rate DIP Notes or any interest accrued thereon) owed hereunder, shall thereafter bear interest (including post-petition interest in any proceeding under any Debtor Relief Laws) payable on demand at a rate that is 2.00% per annum in excess of the interest rate otherwise payable hereunder for Base Rate DIP Notes and (b) at the revocable election of the Collateral Agent or Purchaser any time after the occurrence of such Event of Default, either (i) all DIP Notes that constitute SOFR Rate DIP Notes shall be converted to Base Rate DIP Notes (irrespective of whether the Interest Period in effect at the time of such conversion has expired) and thereupon shall become Base Rate DIP Notes, or (ii) the principal amount of such SOFR Rate DIP Notes outstanding and, to the extent permitted by applicable law, any interest payments on such SOFR Rate DIP Notes, shall thereafter bear interest (including post-petition

41


interest in any proceeding under any Debtor Relief Laws) payable on demand at a rate that is 2.00% per annum in excess of the interest rate otherwise payable hereunder with respect to the applicable SOFR Rate DIP Notes. Payment or acceptance of (x) the increased rates of interest provided for in this Section 2.9 or (y) any amount of interest that is less than the amount due, in each case is not a permitted alternative to timely payment and shall not constitute a waiver of any Event of Default or otherwise prejudice or limit any rights or remedies of Purchaser.

2.10Fees.  Company agrees to pay to Purchaser a commitment fee equal to 2.00% of the Commitments of Purchaser, which commitment fee is fully earned, due and payable on the Closing Date and shall be paid in kind and automatically capitalized and added to the outstanding principal of the New Money DIP Notes on the Closing Date.
2.11Scheduled Payments.  To the extent not previously paid, the DIP Notes, together with all other amounts owed hereunder with respect thereto, shall, be Paid in Full in cash (or as otherwise agreed to in writing by Purchaser) no later than the DIP Notes Maturity Date.
2.12[Reserved]
2.13Mandatory Prepayments.
(a)Asset Sales.  No later than the third Business Day following the date of receipt by any DIP Note Party or any of its Subsidiaries of any Net Asset Sale Proceeds, the DIP Note Parties shall remit 100% of such Net Asset Sale Proceeds to Collateral Agent to prepay the DIP Notes and/or permanently reduce the DIP Note Commitments as set forth in Section 2.14(b) in an aggregate amount equal to such Net Asset Sale Proceeds.
(b)Insurance/Condemnation Proceeds.  No later than the third Business Day following the date of receipt by any DIP Note Party or any of its Subsidiaries, or Collateral Agent as loss payee, of any Net Insurance/Condemnation Proceeds (it being understood that such Net Insurance/Condemnation Proceeds shall be deposited into a Controlled Account within one Business Day following receipt thereof), Company shall prepay the DIP Notes as set forth in Section 2.14(b) in an aggregate amount equal to such Net Insurance/Condemnation Proceeds.
(c)[Reserved].  
(d)Issuance of Debt. On the date of receipt by any DIP Note Party or any of its Subsidiaries of any Cash proceeds (it being understood that any such Cash proceeds shall be deposited into a Controlled Account within one Business Day following receipt thereof) from the incurrence of any Indebtedness of any DIP Note Party or any of its Subsidiaries, excluding any Cash proceeds received with respect to any Indebtedness permitted to be incurred pursuant to Section 6.1, Company shall prepay the DIP Notes as set forth in Section 2.14(b) in an aggregate amount equal to 100% of such proceeds, net of underwriting discounts and commissions and other reasonable costs and expenses associated therewith, in each case, paid to non-Affiliates, including reasonable legal fees and expenses.
(e)[Reserved].  
(f)[Reserved].  

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(g)Extraordinary Receipts.  No later than three (3) Business Days following receipt by Company or any of its Subsidiaries of any Extraordinary Receipts (it being understood that such Extraordinary Receipts shall be deposited in a Controlled Account within one (1) Business Day following the receipt thereof) in excess of $250,000 in the aggregate in any trailing twelve month period, Company shall prepay DIP Notes as set forth in Section 2.14(b) in the amount of such excess Extraordinary Receipts.
(h)[reserved]
(i)Prepayment Certificate.  Concurrently with any prepayment of the DIP Notes pursuant to Sections 2.13(a), 2.13(b) and 2.13(g), Company shall deliver to Purchaser a certificate of a Chief Financial Officer demonstrating the calculation of the amount of the applicable net proceeds and compensation owing to Purchaser under any of the DIP Note Documents, if any, as the case may be.  In the event that Company shall subsequently determine that the actual amount received exceeded the amount set forth in such certificate, Company shall promptly make an additional prepayment of the DIP Notes in an amount equal to such excess, and Company shall concurrently therewith deliver to Purchaser a certificate of a Chief Financial Officer demonstrating the derivation of such excess.
2.14Application of Prepayments/Reductions.
(a)[Reserved].
(b)Application of Prepayments.  Any mandatory prepayment of any DIP Notes pursuant to Section 2.13 shall be applied as follows:

first, to the payment of all fees other than any premium, and all expenses specified in Section 10.2, in each case to the full extent thereof;

second, to the payment of any accrued interest at the Default Rate, if any;

third, to the payment of any accrued interest (other than Default Rate interest);

fourth, to the payment of the applicable premium, if any, on any DIP Note;

fifth, except in connection with any Waivable Mandatory Prepayment as provided in Section 2.14(c), to prepay the Roll Up DIP Notes on a pro rata basis (in accordance with the respective outstanding principal amounts thereof);

and sixth, except in connection with any Waivable Mandatory Prepayment as provided in Section 2.14(c), to prepay the Roll Up DIP Notes on a pro rata basis (in accordance with the respective outstanding principal amounts thereof);

seventh, to payment of any remaining Obligations then due and payable.

(c)Waivable Mandatory Prepayment.  Anything contained herein to the contrary notwithstanding, in the event Company is required to make any mandatory prepayment

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(a “Waivable Mandatory Prepayment”) of the DIP Notes, not less than three Business Days prior to the date (the “Required Prepayment Date”) on which Company is required to make such Waivable Mandatory Prepayment, Company shall notify  Purchaser of the amount of such prepayment and Purchaser’s option to elect not to receive such Waivable Mandatory Prepayment.  Purchaser may exercise such option by giving written notice to Company of its election to do so on or before the first Business Day prior to the Required Prepayment Date (it being understood that if Purchaser does not notify Company of its election to exercise such option on or before the first Business Day prior to the Required Prepayment Date, Purchaser shall be deemed to have elected, as of such date, not to exercise such option).  On the Required Prepayment Date, Company shall pay to Collateral Agent the amount of the Waivable Mandatory Prepayment, which amount shall be applied to Purchaser, if Purchaser has elected not to exercise such option, to prepay the DIP Notes of Purchaser, and (ii) to the extent of any excess, to Company for working capital and general corporate purposes.
2.15General Provisions Regarding Payments.
(a)All payments by Company of principal, interest, fees and other Obligations shall be made in Dollars in immediately available funds, without defense, recoupment, setoff or counterclaim, free of any restriction or condition, and delivered to Purchaser not later than 12:00 p.m. (New York City time) on the date due by wire transfer to an account designated by Purchaser in writing (as may be updated by Purchaser from time to time).  For purposes of computing interest and fees, funds received by Purchaser after that time on such due date shall be deemed to have been paid by Company on the next Business Day.
(b)All payments in respect of the principal amount of any DIP Note shall be accompanied by payment of accrued interest on the principal amount being repaid or prepaid, and all such payments (and, in any event, any payment received in respect of any DIP Note on a date when interest or premium is due and payable with respect to such DIP Note) shall be applied to the payment of interest and premium then due and payable before application to principal.
(c)[Reserved].
(d)[Reserved].
(e)Whenever any payment to be made hereunder shall be stated to be due on a day that is not a Business Day, such payment shall be made on the next Business Day and such extension of time shall be included in the computation of the payment of interest hereunder.
(f)[Reserved].
(g)Purchaser shall deem any payment by or on behalf of Company hereunder that is not made in same day funds prior to 12:00 p.m. (New York City time) to be a non-conforming payment.  Any such payment shall not be deemed to have been received by Purchaser until the later of (i) the time such funds become available funds, and (ii) the applicable next Business Day.  Any non-conforming payment may constitute or become a Default or Event of Default in accordance with the terms of Section 8.1(a).  Interest shall continue to accrue on any principal as to which a non-conforming payment is made until such funds become available funds (but in no event less than the period from the date of such payment to the next Business Day) at

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the Default Rate from the date such amount was due and payable until the date such amount is Paid in Full.
(h)If an Event of Default shall have occurred and not otherwise been waived, and the Obligations have become due and payable in full hereunder, whether by acceleration, maturity or otherwise, all payments or proceeds received by Collateral Agent hereunder or under any Collateral Document in respect of any of the Obligations, including all proceeds received by Collateral Agent in respect of any sale, any collection from, or other realization upon all or any part of the Collateral, shall be applied in full or in part as follows:  first, to the payment of all costs and expenses of such sale, collection or other realization, including reasonable compensation to Collateral Agent and its agents and counsel, and all other expenses, liabilities and advances made or incurred by Collateral Agent in connection therewith, and all amounts for which Collateral Agent is entitled to indemnification hereunder or under any Collateral Document (in its capacity as Collateral Agent and not as Purchaser) and all advances made by Collateral Agent under any Collateral Document for the account of the applicable Grantor, and to the payment of all costs and expenses paid or incurred by Collateral Agent in connection with the exercise of any right or remedy hereunder or under any Collateral Document, all in accordance with the terms hereof or thereof; second, to the extent of any excess of such proceeds, to the payment of the principal, accrued and unpaid interest (including interest accrued at the Default Rate) and fees owing with respect to the DIP Notes for the benefit of Purchaser; third, to the extent of any excess of such proceeds, to the payment of all other Obligations for the benefit of Purchaser; and fourth to the extent of any excess of such proceeds, to the payment to or upon the order of such Grantor or to whosoever may be lawfully entitled to receive the same or as a court of competent jurisdiction may direct.
2.16[Reserved]
2.17Making or Maintaining SOFR Rate DIP Notes.
(a)Changed Circumstances/Temporary Adjusted Term SOFR Unavailability.  Subject to clause (b) below, if, on or prior to the first day of any Interest Period for any SOFR Rate DIP Note:

(i)Collateral Agent determines (which determination shall be conclusive and binding absent manifest error) that “Adjusted Term SOFR” cannot be determined pursuant to the definition thereof, or

(ii)the Purchaser determines that for any reason in connection with any request for a SOFR Rate DIP Note that Adjusted Term SOFR for any requested Interest Period with respect to a proposed SOFR Rate DIP Note does not adequately and fairly reflect the cost to Purchaser of making and maintaining such DIP Note, and Purchaser has provided notice of such determination to Collateral Agent,

Collateral Agent will promptly so notify Company and Purchaser.

Upon notice thereof by Collateral Agent to Company, any obligation of Purchaser to make SOFR Rate DIP Notes shall be suspended (to the extent of the affected SOFR Rate DIP Notes or affected Interest Periods) until Collateral Agent (with respect to clause (ii), at the instruction of Purchaser)

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revokes such notice. Upon receipt of such notice, (i) Company may revoke any pending request for a borrowing of SOFR Rate DIP Notes (to the extent of the affected SOFR Rate DIP Notes or affected Interest Periods). Subject to clause (b), if Collateral Agent determines (which determination shall be conclusive and binding absent manifest error) that “Adjusted Term SOFR” cannot be determined pursuant to the definition thereof on any given day, the interest rate on Base Rate DIP Notes shall be determined by Collateral Agent without reference to clause (iii) of the definition of “Base Rate” until Collateral Agent revokes such determination.

(b)Benchmark Replacement
(i)Notwithstanding anything to the contrary herein or in any other DIP Note Document, if a Benchmark Transition Event and its related Benchmark Replacement Date have occurred prior to any setting of the then-current Benchmark, then (x) if a Benchmark Replacement is determined in accordance with clause (a) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any DIP Note Document in respect of such Benchmark setting and subsequent Benchmark settings without any amendment to, or further action or consent of any other party to, this Agreement or any other DIP Note Document and (y) if a Benchmark Replacement is determined in accordance with clause (b) of the definition of “Benchmark Replacement” for such Benchmark Replacement Date, such Benchmark Replacement will replace such Benchmark for all purposes hereunder and under any DIP Note Document in respect of any Benchmark setting at or after 5:00 p.m. (New York City time) on the fifth (5th) Business Day after the date notice of such Benchmark Replacement is provided to Purchaser without any amendment to, or further action or consent of any other party to, this Agreement or any other DIP Note Document so long as the Collateral Agent has not received, by such time, written notice of objection to such Benchmark Replacement from Purchaser.  If the Benchmark Replacement is Daily Simple SOFR, all interest payments will be payable on a monthly basis.
(ii)Benchmark Replacement Conforming Changes. In connection with the use, administration, adoption or implementation of a Benchmark Replacement, the Collateral Agent will have the right to make Conforming Changes from time to time and, notwithstanding anything to the contrary herein or in any other DIP Note Document, any amendments implementing such Conforming Changes will become effective without any further action or consent of any other party to this Agreement or any other DIP Note Document.
(iii)Notices; Standards for Decisions and Determinations. Collateral Agent will promptly notify the Company and Purchaser of (i) the implementation of any Benchmark Replacement and (ii) the effectiveness of any Conforming Changes in connection with the use, administration, adoption or implementation of a Benchmark Replacement. Collateral Agent will promptly notify the Company and Purchaser of (x) the removal or reinstatement of any tenor of a Benchmark pursuant to this Section 2.17 and (y) the commencement of any Benchmark Unavailability Period. Any determination, decision or election that may be made by Collateral Agent or, if applicable, Purchaser pursuant to this Section 2.17, including any determination with respect to a tenor, rate or

46


adjustment or of the occurrence or non-occurrence of an event, circumstance or date and any decision to take or refrain from taking any action or any selection, will be conclusive and binding absent manifest error and may be made in its or their sole discretion and without consent from any other party to this Agreement or any other DIP Note Document, except, in each case, as expressly required pursuant to this Section 2.17.
(iv)Unavailability of Tenor of Benchmark. Notwithstanding anything to the contrary herein or in any other DIP Note Document, at any time (including in connection with the implementation of a Benchmark Replacement), (i) if the then-current Benchmark is a term rate (including the Term SOFR Reference Rate) and either (A) any tenor for such Benchmark is not displayed on a screen or other information service that publishes such rate from time to time as selected by the Collateral Agent in its reasonable discretion or (B) the regulatory supervisor for the administrator of such Benchmark has provided a public statement or publication of information announcing that any tenor for such Benchmark is not or will not be representative, then the Collateral Agent may modify the definition of “Interest Period” (or any similar or analogous definition) for any Benchmark settings at or after such time to remove such unavailable, non-representative tenor and (ii) if a tenor that was removed pursuant to clause (i) above either (A) is subsequently displayed on a screen or information service for a Benchmark (including a Benchmark Replacement) or (B) is not, or is no longer, subject to an announcement that it is not or will not be representative for a Benchmark (including a Benchmark Replacement), then the Collateral Agent may modify the definition of “Interest Period” (or any similar or analogous definition) for all Benchmark settings at or after such time to reinstate such previously removed tenor.
(v)Benchmark Unavailability Period. Upon the Company’s receipt of notice of the commencement of a Benchmark Unavailability Period, the Company may revoke any pending request for a SOFR Rate DIP Note to be made during any Benchmark Unavailability Period. During a Benchmark Unavailability Period or at any time that a tenor for the then-current Benchmark is not an Available Tenor, the component of the Base Rate based upon the then-current Benchmark or such tenor for such Benchmark, as applicable, will not be used in any determination of the Base Rate.
(c)Illegality or Impracticability of SOFR Rate DIP Notes.  In the event that on any date Purchaser shall have determined (which determination shall be final and conclusive and binding upon all parties hereto but shall be made only after consultation with Collateral Agent) that the issuing or maintaining of its SOFR Rate DIP Notes (i) has become unlawful as a result of compliance by Purchaser in good faith with any law, treaty, governmental rule, regulation, guideline or order (or would conflict with any such treaty, governmental rule, regulation, guideline or order not having the force of law even though the failure to comply therewith would not be unlawful), or (ii) has become impracticable, as a result of contingencies occurring after the date hereof that materially and adversely affect the ability of  Purchaser to issue or maintain its SOFR Rate DIP Notes, then, and in any such event,  Purchaser shall be an “Affected Purchaser” and Affected Purchaser shall on that day give written or telephonic (promptly confirmed in writing) notice to the Company and Collateral Agent of such determination. Thereafter (1) the obligation of Affected Purchaser to make DIP Notes as or convert DIP Notes to SOFR Rate DIP Notes shall be suspended until such notice shall be withdrawn by Affected Purchaser, (2) to the extent such

47


determination by Affected Purchaser relates to a SOFR Rate DIP Note then being requested by Company pursuant to a Funding Notice, Affected Purchaser shall make such DIP Note as a Base Rate DIP Note, (3) Affected Purchaser’s obligation to maintain its outstanding SOFR Rate DIP Notes (the “Affected DIP Notes”) shall be terminated at the earlier to occur of the expiration of the Interest Period then in effect with respect to the Affected DIP Notes or when required by law, and (4) the Affected DIP Notes shall automatically convert into Base Rate DIP Notes on the date of such termination.  Notwithstanding the foregoing, to the extent a determination by Affected Purchaser as described above relates to a SOFR Rate DIP Note then being requested by Company pursuant to a Funding Notice, Company shall have the option, subject to the provisions of Section 2.17(d), to rescind such Funding Notice as to Purchaser by giving written or telephonic (promptly confirmed in writing) notice to Collateral Agent of such rescission on the date on which Affected Purchaser gives notice of its determination as described above. For the avoidance of doubt, the interest rate on which Base Rate DIP Notes shall, if necessary to avoid such illegality, be determined by Collateral Agent without reference to clause (iii) of the definition of “Base Rate”, in each case, until Affected Purchaser notifies Collateral Agent and Company that the circumstances giving rise to such determination no longer exist.
(d)Compensation for Breakage or Non-Commencement of Interest Periods.  Company shall compensate Purchaser, upon written request by Purchaser (which request shall set forth the basis for requesting such amounts), for all reasonable losses, expenses and liabilities (including any interest paid or calculated to be due and payable by Purchaser to lenders of funds borrowed by it to make or carry its SOFR Rate DIP Notes and any loss, expense or liability sustained by Purchaser in connection with the liquidation or re-employment of such funds but excluding loss of anticipated profits) which Purchaser may sustain: (i) if for any reason (other than a default by Purchaser) a borrowing of any SOFR Rate DIP Note does not occur on a date specified therefor in a Funding Notice or a telephonic request for borrowing; (ii) if any prepayment or other principal payment of any of its SOFR Rate DIP Note occurs on any day other than the last day of an Interest Period applicable to that DIP Note (whether voluntary, mandatory, automatic, by reason of acceleration, or otherwise); or (iii) if any prepayment of any of its SOFR Term DIP Note is not made on any date specified in a notice of prepayment given by Company.  
(e)Booking of SOFR Rate DIP Notes.  Purchaser may make, carry or transfer SOFR Rate DIP Notes at, to, or for the account of any of its branch offices or the office of an Affiliate of Purchaser.
2.18Increased Costs; Capital Adequacy.
(a)Compensation For Increased Costs and Taxes.  Subject to and without duplication of the provisions of Section 2.19 (which shall be controlling with respect to the matters covered thereby), in the event that Purchaser shall determine (which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto) that any Change in Law: (i) subjects Purchaser (or its applicable investment office) or any company controlling Purchaser to any additional Tax (other than any Tax on the overall net income of such Person or any other Tax for which additional amounts are specifically not payable under Section 2.19 below) with respect to this Agreement or any of the other DIP Note Documents or any of its obligations hereunder or thereunder, any payments to Purchaser (or its applicable investment office) of principal, interest, fees or any other amount payable hereunder, or its deposits, reserves, other

48


liabilities or capital attributable thereto; (ii) imposes, modifies or holds applicable any reserve (including any marginal, emergency, supplemental, special or other reserve), special deposit, liquidity, compulsory loan, FDIC insurance or similar requirement against assets held by, or deposits or other liabilities in or for the account of, or advances or loans by, or other credit extended by, or any other acquisition of funds by, any office of Purchaser or any company controlling Purchaser; or (iii) imposes any other condition (other than with respect to a Tax matter) on or affecting Purchaser (or its applicable investment office) or any company controlling Purchaser or Purchaser’s obligations hereunder or the ability of Purchaser to make or maintain its SOFR Rate DIP Notes; and the result of any of the foregoing is to increase the cost to Purchaser of agreeing to purchasing, holding or maintaining DIP Notes hereunder or to reduce any amount received or receivable by Purchaser (or its applicable investment office) with respect thereto; then, in any such case, Company shall promptly pay to Purchaser, upon receipt of the statement referred to in the next sentence, such additional amount or amounts (in the form of an increased rate of, or a different method of calculating, interest or otherwise as such Person in its sole discretion shall determine) as may be necessary to compensate such Person for any such increased cost or reduction in amounts received or receivable hereunder.  Purchaser shall deliver to Company a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to such Person under this Section 2.18(a), which statement shall be conclusive and binding upon all parties hereto absent manifest error.
(b)Capital Adequacy and Liquidity Adjustment.  In the event that Purchaser shall have determined (which determination shall, absent manifest error, be final and conclusive and binding upon all parties hereto) that (A) any Change in Law regarding capital adequacy or liquidity, or (B) compliance by Purchaser (or its applicable investment office) or any company controlling Purchaser with any Change in Law regarding capital adequacy or liquidity, has or would have the effect of reducing the rate of return on the capital of Purchaser or any company controlling Purchaser as a consequence of, or with reference to, Purchaser’s DIP Notes or other obligations hereunder with respect to the DIP Notes to a level below that which Purchaser or such controlling company could have achieved but for such Change in Law (taking into consideration the policies of Purchaser or such controlling company with regard to capital adequacy and liquidity), then from time to time, within five Business Days after receipt by Company from Purchaser of the statement referred to in the next sentence, Company shall pay to Purchaser such additional amount or amounts as will compensate Purchaser or such controlling company on an after-tax basis for such reduction. Purchaser shall deliver to Company a written statement, setting forth in reasonable detail the basis for calculating the additional amounts owed to Purchaser under this Section 2.18(b), which statement shall be conclusive and binding upon all parties hereto absent manifest error.
(c)Delay in Requests.  Failure or delay on the part of Purchaser to demand compensation pursuant to this Section 2.18 shall not constitute a waiver of Purchaser’s right to demand such compensation; provided that Company shall not be required to compensate Purchaser pursuant to this Section 2.18 for any increased costs incurred or reductions suffered more than nine months prior to the date that Purchaser notifies Company of the Change in Law giving rise to such increased costs or reductions, and of Purchaser’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the nine-month period referred to above shall be extended to include the period of retroactive effect thereof).

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2.19Taxes; Withholding, Etc.
(a)Payments to Be Free and Clear.  All sums payable by or on behalf of any DIP Note Party hereunder and under the other DIP Note Documents shall (except to the extent required by law) be paid free and clear of, and without any deduction or withholding on account of, any Tax (other than a Tax on the overall net income of Purchaser).
(b)Withholding of Taxes.  If any DIP Note Party or any other Person (acting as a withholding agent) is (in such withholding agent’s reasonable good faith discretion) required by law to make any deduction or withholding on account of any Tax from any sum paid or payable by any DIP Note Party to Purchaser under any of the DIP Note Documents: (i) Company shall notify Purchaser of any such requirement or any change in any such requirement as soon as Company becomes aware of it; (ii) Company or any other Person (acting as a withholding agent) shall pay or cause to be paid any such Tax before the date on which penalties attach thereto, such payment to be made (if the liability to pay is imposed on any DIP Note Party) for its own account or (if that liability is imposed on Purchaser, as the case may be) on behalf of and in the name of Purchaser; (iii) unless otherwise provided in this Section 2.19 (other than a Tax on the “overall net income” of Purchaser) the sum payable by such DIP Note Party in respect of which the relevant deduction, withholding or payment is required shall be increased to the extent necessary to ensure that, after the making of that deduction, withholding or payment (including any such withholding Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section 2.19), Purchaser, as the case may be, receives on the due date a net sum equal to what it would have received had no such deduction, withholding or payment been required or made; and (iv) within thirty days after the due date of payment of any such Tax that it is required by clause (ii) above to pay, Company shall deliver to Purchaser evidence satisfactory to the other affected parties of such deduction, withholding or payment and of the remittance thereof to the relevant taxing or other authority; provided, with respect to any U.S. federal withholding tax  (including any withholding tax imposed under FATCA), no such additional amount shall be required to be paid to Purchaser under clause (iii) above except to the extent that any change after the date hereof in any such requirement for a deduction, withholding or payment as is mentioned therein shall result in an increase in the rate of such deduction, withholding or payment from that in effect at the date hereof, in respect of payments to Purchaser; provided that additional amounts shall be payable to Purchaser to the extent that Purchaser’s transferor was entitled to receive such additional amounts.
(c)Evidence of Exemption From U.S. Withholding Tax.  If Purchaser is not a “United States person” (as such term is defined in Section 7701(a)(30) of the Code) for U.S. federal income tax purposes (a “Non-U.S. Purchaser”), then Purchaser shall, to the extent Purchaser is legally entitled to do so, deliver to Company, on or prior to the Closing Date, and at such other times as may be necessary in the determination of Company (in the reasonable exercise of its discretion), (i) two copies of Internal Revenue Service Form W-8BEN, W-8BEN-E, W-8ECI, W-8EXP and/or W-8IMY (or, in each case, any successor forms), properly completed and duly executed by Purchaser, and such other documentation required under the Code and reasonably requested by Company to establish that Purchaser is not subject to (or is subject to a reduced rate of) deduction or withholding of U.S. federal income tax with respect to any payments to Purchaser of principal, interest, fees or other amounts payable under any of the DIP Note Documents, or (ii) if Purchaser is not a “bank” or other Person described in Section 881(c)(3) of the Code, a U.S. Tax Compliance Certificate together with two copies of Internal Revenue Service Form W-8BEN, W-

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8BEN-E or W-8IMY (or, in each case, any successor form), properly completed and duly executed by Purchaser, and such other documentation required under the Code and reasonably requested by Company to establish that Purchaser is not subject to (or is subject to a reduced rate of) deduction or withholding of U.S. federal income tax with respect to any payments to Purchaser of interest payable under any of the DIP Note Documents.  If Purchaser is a “United States person” (as such term is defined in Section 7701(a)(30) of the Code) for U.S. federal income tax purposes (a “U.S. Purchaser”), then Purchaser shall deliver to Company on or prior to the Closing Date, two copies of Internal Revenue Service Form W-9 (or any successor form), properly completed and duly executed by Purchaser, certifying that such U.S. Purchaser is entitled to an exemption from U.S. backup withholding tax, or otherwise prove that it is entitled to such an exemption.  If Purchaser required to deliver any forms, certificates or other evidence with respect to U.S. federal income tax withholding matters pursuant to this Section 2.19(c), Purchaser hereby agrees, from time to time after the initial delivery by Purchaser of such forms, certificates or other evidence, whenever a lapse in time or change in circumstances renders such forms, certificates or other evidence obsolete or inaccurate in any material respect, that Purchaser shall promptly deliver to Company two new copies of Internal Revenue Service Form W-8BEN, W-8BEN-E, W-8ECI, W-8EXP, W-8IMY, and/or W-9 (or, in any case, any successor form), or a U.S. Tax Compliance Certificate and two copies of Internal Revenue Service Form W-8BEN, W-8BEN-E, or W-8IMY (or, in each case, any successor form), as the case may be, properly completed and duly executed by Purchaser, and such other documentation required under the Code and reasonably requested by Company to confirm or establish that Purchaser is not subject to deduction or withholding of U.S. federal income tax with respect to payments to Purchaser under the DIP Note Documents, or notify Company of its inability to deliver any such forms, certificates or other evidence.  Notwithstanding anything to the contrary, Company shall not be required to pay any additional amount to Purchaser under Section 2.19(b) if Purchaser shall have failed to deliver the forms, certificates or other evidence required by this Section 2.19(c).
(d)FATCA.  Notwithstanding anything to the contrary therein, Company shall not be required to pay any additional amount pursuant to Section 2.19(b) with respect to any U.S. federal withholding tax imposed under FATCA.  If a payment made to Purchaser under any DIP Note Document would be subject to U.S. federal withholding Tax imposed by FATCA if Purchaser were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), Purchaser shall deliver to Company at the time or times prescribed by law and at such time or times reasonably requested by Company such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Company as may be necessary for Company to comply with their obligations under FATCA and to determine that Purchaser has complied with Purchaser’s obligations under FATCA or to determine the amount to deduct and withhold from such payment.  Solely for purposes of the preceding sentence of this clause (d), “FATCA” shall include any amendments made to FATCA after the date hereof.
(e)Payment of Other Taxes by Company.  Without limiting the provisions of Section 2.19(b), Company shall timely pay to the relevant Governmental Authorities in accordance with applicable law or, at the option of Purchaser timely reimburse it for the payment of, all Other Taxes.  

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(f)Indemnification by DIP Note Parties. DIP Note Parties shall jointly and severally indemnify Purchaser for the full amount of Taxes for which additional amounts are required to be paid pursuant to Section 2.19(b) arising in connection with payments made under this Agreement or any other DIP Note Document and Other Taxes (including any such Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section 2.19) paid or payable by Purchaser or any of their respective Affiliates and any reasonable expenses arising therefrom or with respect thereto, whether or not such Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate as to the amount of such payment or liability delivered to any DIP Note Party shall be conclusive absent manifest error. Such payment shall be due within ten days of such DIP Note Party’s receipt of such certificate.
(g)[Reserved].  
(h)Evidence of Payments.  As soon as practicable after any payment of Taxes by any DIP Note Party to a Governmental Authority pursuant to this Section 2.19, such DIP Note Party shall deliver to Purchaser the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to Purchaser.
(i)Survival.  Each party’s obligations under this Section 2.19 shall survive any assignment of rights by, or the replacement of, Purchaser, the termination of the Commitments and the repayment, satisfaction or discharge of all obligations under any DIP Note Document.
2.20Obligation to Mitigate.  Purchaser agrees that, if Purchaser requests payment under Section 2.18 or 2.19, then Purchaser will, to the extent not inconsistent with any applicable legal or regulatory restrictions, use reasonable efforts to hold or maintain its DIP Notes, through another office of Purchaser if, as a result thereof, the additional amounts payable to Purchaser pursuant to Section 2.18 or 2.19, as the case may be, in the future would be eliminated or reduced and if, as determined by Purchaser in its sole discretion, the purchasing, holding or maintaining of such DIP Notes through such other office or in accordance with such other measures, as the case may be, would not otherwise materially adversely affect such DIP Notes or the interests of Purchaser; provided, Purchaser will not be obligated to utilize such other office pursuant to this Section 2.20 unless Company agrees to pay all incremental expenses incurred by Purchaser as a result of utilizing such other office as described above.  A certificate as to the amount of any such expenses payable by Company pursuant to this Section 2.20 (setting forth in reasonable detail the basis for requesting such amount) submitted by Purchaser to shall be conclusive absent manifest error.
2.21[Reserved].
2.22[Reserved].
2.23Representations and Warranties by Purchaser.  Purchaser hereby represents and warrants to Company as follows:
(a)Organization and Qualification.  Purchaser is a corporation, limited partnership or limited liability company, in either case duly organized, validly existing and in good

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standing under the laws of its jurisdiction of organization. Purchaser has all requisite power and authority to execute and deliver this Agreement and to perform its obligations hereunder and to consummate the transactions contemplated hereby, and all action required on the part of Purchaser for such execution, delivery and performance has been duly and validly taken. Assuming due execution and delivery by the DIP Note Parties, this Agreement constitutes the legal, valid and binding obligation of Purchaser enforceable against Purchaser in accordance with its terms, except as enforceability thereof may be limited by bankruptcy, insolvency, moratorium and other similar laws affecting creditors’ rights generally and by general equitable principles.
(b)Investor Status. It (i) is an “accredited investor”, as that term is defined in Regulation D under the Securities Act, (ii) has such knowledge, skill, sophistication and experience in business and financial matters, based on actual participation, that it is capable of evaluating the merits and risks of the purchase of the DIP Notes from Company and the suitability thereof for Purchaser, (iii) is a sophisticated purchaser with respect to the purchase of the DIP Notes, (iv) is able to bear the economic risk associated with the purchase of the DIP Notes, (v) has had an opportunity to ask questions of the principal officers and representatives of Company and to obtain any additional information necessary to permit an evaluation of the benefits and risks associated with the investment made hereby, (vi) has been provided adequate information concerning the business and financial condition of Company to make an informed decision regarding the purchase of the DIP Notes, (vii) has such knowledge and experience, and has made investments of a similar nature, so as to be aware of the risks and uncertainties inherent in the purchase of rights and assumption of liabilities of the type contemplated in this Agreement, (viii) has independently and without reliance upon Company, and based on such information as Purchaser has deemed appropriate, made its own analysis and decision to enter into this Agreement, except that Purchaser has relied upon Company’s express representations and warranties in this Agreement and other DIP Note Documents, and (ix) is not an “affiliate” (as that term is defined in Rule 405 promulgated under the Securities Act) of Company or any of the Guarantors.
(c)Investment for Own Account. Purchaser is purchasing the DIP Notes for investment for its own account, not as a nominee or agent, and not with a view towards the sale or distribution or public offering of any part thereof in violation of applicable securities laws of the United States or any state thereof. Purchaser acknowledges there are restrictions on its ability to resell the DIP Notes under applicable securities laws.
(d)Transfer Restrictions. Purchaser understands that the offering and sale of the DIP Notes by Company will not be registered under the Securities Act or any state securities laws, by reason of their issuance in a transaction exempt from the registration requirements of the Securities Act and such laws and that the DIP Notes may only be resold if they are subsequently registered under the Securities Act and such laws or a disposition or transfer thereof is exempt from registration; Company has no obligation to register the resale of the DIP Notes; and there is no existing public or other market for the DIP Notes nor is any such market expected to develop. Purchaser understands that any certificate representing the DIP Notes that are issued to Purchaser may bear, in Company’s discretion, the following restrictive legend and will be restricted from transfer in accordance with such legend:

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“The sale of this Senior Secured DIP Note has not been and will not be registered under the United States Securities Act 1933 (the “Securities Act”) or with any securities regulatory authority of any state or other jurisdiction of the United States. The holder hereof, by purchasing or otherwise acquiring this security, acknowledges that the sale of this security has not been registered under the Securities Act. The holder agrees for the benefit of Company, any distributors or dealers and any such persons’ affiliates that this security may be offered, resold, pledged or otherwise transferred only in compliance with the Securities Act and any applicable state securities laws and only (1) pursuant to Rule 144 under the Securities Act or (2) pursuant to another exemption from registration under the Securities Act, and in each case in accordance with any applicable securities laws of the states of the United States and other jurisdictions.”

2.24Priority and Liens
(a)Each of the DIP Note Parties hereby covenants and agrees that upon the entry of, and subject to, the Interim Order (and, when entered, the Final Order) and subject to the Carve-Out in all respects, the Obligations:
(i)pursuant to Section 364(c)(1) of the Bankruptcy Code, shall at all times constitute an allowed super-priority administrative expense claim in the Chapter 11 Cases, subject only to the Carve-Out and having priority over any and all other administrative expenses, diminution claims and all other priority claims against Company, now existing or hereafter arising, of any kind whatsoever, including, without limitation, all other administrative expenses of the kind specified in Sections 503(b) and 507(b) of the Bankruptcy Code, and over any and all other administrative expenses or other claims arising under Sections 105, 328, 330, 331, 365, 503(b), 506(c), 507(a), 507(b), 726, 1113 or 1114 of the Bankruptcy Code (the “Superpriority Claim”), which allowed Superpriority Claim shall be payable from and have recourse to all pre- and post-petition property of the Debtors, including all cash and cash equivalents, and all proceeds thereof; including, without limitation, but subject to entry of the Final Order, any Avoidance Actions Proceeds (defined below);
(ii)pursuant to Section 364(c)(2) of the Bankruptcy Code, shall be secured by valid, binding, continuing, enforceable, fully perfected first priority Liens on all Collateral to the extent that such Collateral was not subject to Permitted Priority Liens; it being agreed that such Collateral shall not include claims and causes of action under Sections 502(d), 544, 545, 547, 548, 550 and 553 of the Bankruptcy Code, but shall, subject to entry of the Final Order by the Bankruptcy Court, include the proceeds thereof (the “Avoidance Action Proceeds”);
(iii)pursuant to Section 364(d)(1) of the Bankruptcy Code, shall be secured by valid, binding, continuing, enforceable, fully perfected first priority senior priming Liens on all Collateral, which Liens shall be senior to the Liens securing the Pre-Petition Security Interests and any Liens to which the Pre-Petition Security Interests are senior or rank pari passu (the “Primed Liens”), subject, in each case, only to Permitted Priority Liens (other than the Pre-Petition Security Interests and the Primed Liens) and the Carve-Out; and

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(iv)pursuant to Section 364(c)(3) of the Bankruptcy Code, shall be secured by valid, binding, continuing, enforceable, fully-perfected, junior Liens on all Collateral, subject to Permitted Priority Liens (other than the Pre-Petition Security Interests and the Primed Liens) and the Carve-Out.
(b)The relative priorities of the Liens described in this Section 2.24 with respect to the Collateral shall be as set forth in the Orders and the Collateral Documents. In accordance with the Orders, all of the Liens described in this Section 2.24 shall be effective and perfected upon entry of the Orders, without the necessity of the execution, recordation or filings by the DIP Note Parties of security agreements, control agreements, financing statements, mortgages or other similar documents or the possession or control by the Collateral Agent of, or over, any Collateral, as set forth in the Orders.  For the avoidance of doubt and notwithstanding the foregoing, with respect to Avoidance Action Proceeds, any Superpriority Claims and Liens as set forth above or in the Collateral Documents shall, in each case, be subject to the entry (and terms) of the Final Order.
Section 3CONDITIONS PRECEDENT
3.1Closing Date.  The obligation of Purchaser to enter into this Agreement and to purchase the New Money Initial DIP Notes and Roll Up DIP Notes on the Closing Date, is subject to the satisfaction, or waiver in accordance with Section 10.5, of the following conditions on or before the Closing Date:
(a)DIP Note Documents.  Purchaser shall have received sufficient copies of this Agreement, DIP Notes in the form of Exhibit J-1 and Exhibit J-2, the Pledge and Security Agreement and each other DIP Note Document to be dated as of the Closing Date, in each case as Purchaser shall request, in form and substance satisfactory to Purchaser, and executed and delivered by each applicable DIP Note Party and each other Person party thereto.
(b)Organizational Documents; Incumbency.  Purchaser shall have received in respect of each DIP Note Party (i) copies of each Organizational Document as Purchaser shall request, in each case certified by an Authorized Officer of such DIP Note Party and, to the extent applicable, certified as of the Closing Date or a recent date prior thereto by the appropriate Governmental Authority; (ii) signature and incumbency certificates of the officers of such DIP Note Party executing any DIP Note Documents to which it is a party; (iii) resolutions of the Board of Directors of each DIP Note Party approving and authorizing the execution, delivery and performance of this Agreement and the other DIP Note Documents, in each case, to which it is a party or by which it or its assets may be bound as of the Closing Date, certified as of the Closing Date by an appropriate Authorized Officer as being in full force and effect without modification or amendment; (iv) a good standing certificate from the applicable Governmental Authority of such DIP Note Party’s jurisdiction of incorporation, organization or formation and in each jurisdiction in which it is qualified as a foreign corporation or other entity to do business to the extent the failure to be so qualified could reasonably be expected to result in a Material Adverse Effect, each dated a recent date prior to the Closing Date; and (v) such other documents as Purchaser may reasonably request.

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(c)Organizational and Capital Structure.  The organizational structure and capital structure of Company and its Subsidiaries, shall be as set forth on Schedule 4.1 and 4.2.  The Section 382 Ownership Shift (as of Company’s last “owner shift”) shall not exceed 46 percent; provided that this shall be determined without taking into account the issuance of, amendment to, or exercise of the Warrants.  For the avoidance of doubt, with regard to this Section 3.1(c) and Section 6.21, the parties acknowledge that any amendment to the Warrants will not constitute an issuance of stock.
(d)First Day Orders.  Collateral Agent and Purchaser shall have received reasonably satisfactory evidence of the entry of orders approving all “first day” motions (including any motions related to cash management or any critical vendor or supplier motions), which motions and orders shall, in each case, be in form and substance reasonably satisfactory to Purchaser.
(e)Interim Order.  (i) The Interim Order shall have been entered by the Bankruptcy Court, shall be in full force and effect and shall not have been vacated, stayed, modified or amended in any respect without the prior written consent of Purchaser, and (ii) the DIP Note Parties shall be in compliance with the terms of the Interim Order in all respects.
(f)[Reserved]
(g)[Reserved]
(h)Governmental Authorizations and Consents.  Each DIP Note Party shall have obtained all Governmental Authorizations and all consents of other Persons, in each case that are necessary or advisable in connection with the transactions contemplated by the DIP Note Documents to occur on or prior to the Closing Date (including the entering into of the DIP Note Documents to be delivered on the Closing Date) and each of the foregoing shall be in full force and effect and in form and substance reasonably satisfactory to Purchaser.  All applicable waiting periods shall have expired without any action being taken or threatened by any competent authority that would restrain, prevent or otherwise impose adverse conditions on the transactions contemplated by the DIP Note Documents to occur on or prior to the Closing Date or the financing thereof and no action, request for stay, petition for review or rehearing, reconsideration, or appeal with respect to any of the foregoing shall be pending, and the time for any applicable agency to take action to set aside its consent on its own motion shall have expired.
(i)Approved Budget. Collateral Agent shall have received the Approved Budget, together with a certificate of an Authorized Officer of Company certifying that such Approved Budget presents, in all material respects, on a pro forma basis, the projected financial operations and disbursements of the DIP Note Parties for the period specified therein and such forecasts in the view of the management of the DIP Note Parties are based upon reasonable assumptions and other information available to the DIP Note Parties as of the Petition Date.  
(j)Personal Property Collateral.  In order to create in favor of Collateral Agent, for the benefit of Secured Parties, a valid, perfected security interest described in, and with the priority provided in, Section 2.24, in the personal property Collateral, each DIP Note Party shall have delivered to Collateral Agent:  

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(i)evidence satisfactory to Collateral Agent of the compliance by each DIP Note Party of their obligations under the Pledge and Security Agreement and the other Collateral Documents (including their obligations to authorize or execute, as the case may be, and deliver UCC financing statements, originals of securities, instruments and chattel paper and any agreements governing deposit and/or securities accounts , in each case, to the extent provided therein);
(ii)evidence that each DIP Note Party shall have taken or caused to be taken any other action, executed and delivered or caused to be executed and delivered any other agreement, document and instrument (including an Intercompany Note) and made or caused to be made any other filing and recording (other than as set forth herein) reasonably required by Collateral Agent.
(k)[Reserved]
(l)[Reserved]
(m)[Reserved]
(n)[Reserved]
(o)Fees.  Company shall have paid to Collateral Agent and all expenses payable pursuant to Section 10.2 or otherwise required to be paid or reimbursed to the Collateral Agent and Purchaser, including all reasonable and documented out-of-pocket fees or legal counsel, financial advisors and other professionals to the Collateral Agent and Purchaser that have accrued to the Closing Date (to the extent invoiced prior to the Closing Date).
(p)Collateral.  Collateral Agent and Purchaser shall have received, in each case, in form and substance satisfactory to Collateral Agent and Purchaser, any Collateral Documents required for perfection of the Liens on the Collateral (including, with respect to Intellectual Property, executed copies of any such Collateral Documents set forth in Section 4.7 of the Pledge and Security Agreement) reasonably requested by Purchaser and (ii) reasonably requested insurance deliverables pursuant to Section 5.5.
(q)Closing Date Certificate.  Company shall have delivered to Purchaser an originally executed Closing Date Certificate.
(r)No Litigation.  There shall not exist any action, suit, investigation, litigation or proceeding, hearing, or other legal or regulatory developments, pending or threatened in any court or before any arbitrator or Governmental Authority that, in the reasonable opinion of Purchaser, singly or in the aggregate, could reasonably be expected to have a Material Adverse Effect.
(s)Due Diligence.  Purchaser shall have completed, to its satisfaction, all legal, tax, environmental, business and other due diligence with respect to the business, assets, liabilities, operations and condition (financial or otherwise) of the DIP Note Parties in scope and determination satisfactory to  Purchaser in their respective discretion (including satisfactory review of all Material Contracts), and, other than changes occurring in the ordinary course of business, no

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information or materials are or should have been available to the DIP Note Parties as of the Closing Date that are materially inconsistent with the material previously provided to Purchaser for their respective due diligence review of the DIP Note Parties.
(t)[Reserved]
(u)No Material Adverse Change.  Since the Petition Date, no Material Adverse Effect has occurred.
(v)[Reserved]
(w)[Reserved]
(x)Letter of Direction.  Purchaser shall have received a duly executed letter of direction from Company addressed to Purchaser, on behalf of itself and Purchaser, directing the disbursement on the Closing Date of the proceeds of the DIP Notes made on such date substantially in the form of Exhibit B hereto.
3.2Conditions to Credit Date.
(a)Conditions Precedent.  The obligation of Purchaser to purchase the DIP Notes on the Closing Date or the Additional DIP Notes Closing Date, as applicable, are subject to the satisfaction, or waiver in accordance with Section 10.5, of the following conditions precedent:
(i)Purchaser shall have received a fully executed and delivered Funding Notice;
(ii)As of such Credit Date, the representations and warranties contained herein and in the other DIP Note Documents shall be true and correct in all material respects on and as of that Credit Date to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case such representations and warranties shall have been true and correct in all material respects on and as of such earlier date; provided that, in each case, such materiality qualifier shall not apply to any representations and warranties to the extent already qualified or modified by materiality or similar concept in the text thereof;
(iii)As of such Credit Date, no event shall have occurred and be continuing or would result from the issuance and sale of the DIP Notes that would constitute an Event of Default or a Default;
(iv)(a) With respect to the purchase of New Money Initial DIP Notes and Roll Up DIP Notes on the Closing Date, the Interim Order shall remain in full force and effect and shall not have been modified or amended without the consent of Purchaser and shall not have been reversed or stayed pending appeal and (b) With respect to the purchase of New Money Additional DIP Notes on the Additional DIP Notes Closing Date, the Final Order shall remain in effect and shall not have been modified or amended without the consent of Purchaser and shall not have been reversed or stayed pending appeal;

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(v)[reserved];
(vi)As of such Credit Date, the Debtors shall be in compliance in all material respects with the Orders; and
(vii)As of such Credit Date, Company shall have paid all adequate protection payments to the Pre-Petition Purchasers and the Pre-Petition Note Purchase Agent, as applicable, as provided in the Interim Order and shall have paid to Collateral Agent all expenses payable pursuant to Section 10.2 or otherwise required to be paid or reimbursed to the Collateral Agent and Purchaser, including all reasonable and documented out-of-pocket fees of legal counsel, financial advisors and other professionals to the Collateral Agents and Purchaser, that have accrued to such Credit Date.
(b)Each request for the sale and purchase of a DIP Note by Company hereunder shall constitute a representation and warranty by Company as of the applicable Credit Date that the conditions contained in Section 3.2(a) have been satisfied.
Section 4REPRESENTATIONS AND WARRANTIES

In order to induce Collateral Agent and Purchaser to enter into this Agreement and to purchase the DIP Notes, each DIP Note Party represents and warrants to Collateral Agent and Purchaser, on the Closing Date and on each Credit Date, that the following statements are true and correct:

4.1Organization; Requisite Power and Authority; Qualification.  Subject to entry of the Interim Order (or the Final Order, when applicable), each DIP Note Party has the power, authority and legal right to make, deliver and perform under the DIP Note Documents to which it is a party and to obtain or guarantee (as applicable) extensions of credit hereunder or thereunder.  Each DIP Note Party has taken all necessary organizational action to authorize the execution, delivery and performance of the DIP Note Documents to which it is a party and to authorize the extensions or guarantees (as applicable) of credit on the terms and conditions set forth under the DIP Note Documents to which it is a party.  Subject to entry of the Interim Order (or the Final Order, when applicable), each DIP Note Document to which any DIP Note Party is a party on the Closing Date has been duly executed and delivered on behalf of such DIP Note Party and constitutes a legal, valid and binding obligation of such DIP Note Party, enforceable against such DIP Note Party in accordance with its terms.
4.2Capital Stock and Ownership.  The Capital Stock of each of Company and its Subsidiaries has been duly authorized and validly issued and is fully paid and non-assessable.  Except as set forth on Schedule 4.2, as of the date hereof, there is no existing option, warrant, call, right, commitment or other agreement to which Company or any of its Subsidiaries is a party requiring, and there is no membership interest or other Capital Stock of Company or any of its Subsidiaries outstanding that upon conversion or exchange would require, the issuance by Company or any of its Subsidiaries of any additional Capital Stock of Company or any of its Subsidiaries or other Securities convertible into, exchangeable for or evidencing the right to subscribe for or purchase, additional Capital Stock of Company or any of its Subsidiaries.  

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Schedule 4.2 correctly sets forth the ownership interest of Company and each of its Subsidiaries in their respective Subsidiaries as of the Closing Date.

4.3Power; Authorization; Enforceable Obligations.  The execution, delivery and performance of the DIP Note Documents have been duly authorized by all necessary action on the part of each DIP Note Party that is a party thereto.
4.4No Conflict.  Subject to the entry of the Interim Order (or the Final Order, when applicable) by the Bankruptcy Court, the execution, delivery and performance by DIP Note Parties of the DIP Note Documents to which they are parties and the consummation of the transactions contemplated by the DIP Note Documents do not and will not (a) violate any provision of any law or any governmental rule or regulation applicable to Company or any of its Subsidiaries, any of the Organizational Documents of Company or any of its Subsidiaries, or any order, judgment or decree of any court or other agency of government binding on Company or any of its Subsidiaries; (b) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Material Contract or any other material Contractual Obligation of Company or any of its Subsidiaries; (c) result in or require the creation or imposition of any Lien upon any of the properties or assets of Company or any of its Subsidiaries (other than Permitted Liens); or (d) require any approval of stockholders, members or partners or any approval or consent of any Person under any Material Contract or any other material Contractual Obligation of Company or any of its Subsidiaries, except for such approvals or consents that have been obtained on or before the Closing Date and have been disclosed in writing to Purchaser and except, in the case of Material Contracts or any other material Contractual Obligation, for any such consents and approvals the failure of which to obtain could not individually or in the aggregate reasonably be expected to have a Material Adverse Effect.
4.5Governmental Consents.  The execution, delivery and performance by DIP Note Parties of the DIP Note Documents to which they are parties and the consummation of the transactions contemplated by the DIP Note Documents do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any Governmental Authority, except for (a) such approvals or consents which have been obtained and are in full force and effect, (b) filings and recordings with respect to the Collateral to be made, or otherwise delivered to Collateral Agent for filing and/or recordation, as of the Closing Date, (c) any required EDGAR filings and (d) the entry and continued effectiveness of the Orders).
4.6Binding Obligation.  Subject to the entry of the Interim Order (or the Final Order, when applicable) by the Bankruptcy Court, each DIP Note Document required to be delivered hereunder has been duly executed and delivered by each DIP Note Party that is a party thereto and is the legally valid and binding obligation of such DIP Note Party, enforceable against such DIP Note Party in accordance with its respective terms.
4.7Historical Financial Statements.  The Historical Financial Statements were prepared in conformity with GAAP and fairly present, in all material respects, the financial position, on a consolidated basis, of the Persons described in such financial statements as at the respective dates thereof and the results of operations and cash flows, on a consolidated basis, of the entities described therein for each of the periods then ended, subject, in the case of any such unaudited financial statements, to changes resulting from audit and normal year-end adjustments.  

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As of the Closing Date, neither Company nor any of its Subsidiaries has any contingent liability or liability for taxes, long-term lease or unusual forward or long-term commitment that is not reflected in the Historical Financial Statements or the notes thereto and that in any such case is material in relation to the business, operations, properties, assets, condition (financial or otherwise) or prospects of Company and any of its Subsidiaries taken as a whole.

4.8[Reserved]
4.9No Material Adverse Change.  Since the date that is ninety (90) days prior to the Petition Date, no event, circumstance or change has occurred that has caused or evidences, either in any case or in the aggregate, a Material Adverse Effect.
4.10[Reserved]
4.11Adverse Proceedings, etc.  There are no Adverse Proceedings (other than the Chapter 11 Cases) that could reasonably be expected to result in a Material Adverse Effect or liability (except to the extent covered by insurance as to which a solvent and unaffiliated insurance company has not denied coverage) of Company, any of its Subsidiaries or any of their respective Affiliates in excess of $250,000, individually, or $500,000, in the aggregate for all such Adverse Proceedings, in each case during the term of this Agreement.  Neither Company nor any of its Subsidiaries (a) is in violation of any applicable laws (including Environmental Laws)  that could reasonably be expected to result in a Material Adverse Effect, or (b) is subject to or in default with respect to any final judgments, writs, injunctions, decrees, rules or regulations of any court or any federal, state, municipal or other governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, that could reasonably be expected to result in a Material Adverse Effect or liability (except to the extent covered by insurance as to which a solvent and unaffiliated insurance company has not denied coverage) of Company, any of its Subsidiaries or any of their respective Affiliates in excess of $250,000, individually, or $500,000, in the aggregate for all such defaults, in each case during the term of this Agreement.
4.12Payment of Taxes.  Except as otherwise permitted under Section 5.3, all income tax returns and other material tax returns and reports of Company and its Subsidiaries required to be filed by any of them have been timely filed, and all Taxes due and payable and all assessments, fees and other governmental charges upon Company and its Subsidiaries and upon their respective properties, assets, income, businesses and franchises that are due and payable have been paid when due and payable (other than any (a) Taxes the amount or validity of which are currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided on the books of Company and/or its applicable Subsidiary, as the case may be, (b) to the extent otherwise excused or prohibited by the Bankruptcy Court and not otherwise authorized by the Bankruptcy Court). There is no proposed tax assessment against Company or any of its Subsidiaries that is not being actively contested by Company or such Subsidiary in good faith and by appropriate proceedings; provided, such reserves or other appropriate provisions, if any, as shall be required in conformity with GAAP shall have been made or provided therefor.  

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4.13Properties.
(a)Title.  Each of Company and its Subsidiaries has (i) good, sufficient and legal title to (in the case of fee interests in real property), (ii) valid leasehold interests in (in the case of leasehold interests in real or personal property), (iii) valid licensed rights in (in the case of licensed interests in Intellectual Property), and (iv) good title to (in the case of all other personal property), all of their respective properties and assets reflected in their respective Historical Financial Statements referred to in Section 4.7 and in the most recent financial statements delivered pursuant to Section 5.1, in each case except for assets disposed of since the date of such financial statements in the ordinary course of business or as otherwise permitted under Section 6.9.  Except as permitted by this Agreement, all such properties and assets are free and clear of Liens.
(b)Real Estate.  As of the Closing Date, Schedule 4.13 contains a true, accurate and complete list of (i) all Real Estate Assets and (ii) all leases, subleases or assignments of leases (together with all amendments, modifications, supplements, renewals or extensions of any thereof) affecting each Real Estate Asset of any DIP Note Party, regardless of whether such DIP Note Party is the landlord or tenant (whether directly or as an assignee or successor in interest) under such lease, sublease or assignment.  Each agreement listed in clause (ii) of the immediately preceding sentence is in full force and effect and Company does not have knowledge of any default that has occurred and is continuing thereunder, and each such agreement constitutes the legally valid and binding obligation of each applicable DIP Note Party, enforceable against such DIP Note Party in accordance with its terms, except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors’ rights generally or by equitable principles.
4.14Environmental Matters.  Neither Company nor any of its Subsidiaries nor any of their respective Facilities or operations are subject to any outstanding written order, consent decree or settlement agreement with any Person relating to any Environmental Law, any Environmental Claim, or any Hazardous Materials Activity that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.  Neither Company nor any of its Subsidiaries has received any letter or request for information under Section 104 of the Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C. § 9604) or any comparable state law.  There are and, to each of Company’s and its Subsidiaries’ knowledge, have been, no conditions, occurrences, or Hazardous Materials Activities that could reasonably be expected to form the basis of an Environmental Claim against Company or any of its Subsidiaries that, individually or in the aggregate, could reasonably be expected to have a Material Adverse Effect.  Neither Company nor any of its Subsidiaries nor, to any DIP Note Party’s knowledge, any predecessor of Company or any of its Subsidiaries has filed any notice under any Environmental Law indicating past or present treatment of Hazardous Materials at any Facility, and none of Company’s or any of its Subsidiaries’ operations involves the generation, transportation, treatment, storage or disposal of hazardous waste, as defined under 40 C.F.R. Parts 260-270 or any state equivalent.  Compliance with all current or reasonably foreseeable future requirements pursuant to or under Environmental Laws could not be reasonably expected to have, individually or in the aggregate, a Material Adverse Effect.  No event or condition has occurred or is occurring with respect to Company or any of its Subsidiaries relating to any Environmental Law, any Release of Hazardous Materials, or any Hazardous Materials Activity that individually or in the aggregate has had, or could reasonably be expected to have, a Material Adverse Effect.

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4.15No Defaults.  Except as set forth in Schedule 4.15, neither of Company nor any Guarantor is in default in the performance, observance or fulfillment of any of the obligations, covenants or conditions contained in any of its Contractual Obligations (other than with respect to any purported default arising from the filing of the Chapter 11 Cases), nor, to the applicable DIP Note Party’s knowledge, is any counterparty to such Contractual Obligation in default, and no condition exists that, with the giving of notice or the lapse of time or both, would constitute such a default, except where the direct or indirect consequences of such default or defaults, if any, would not reasonably be expected to result in a Material Adverse Effect.  No Default or Event of Default (which has not been waived) has occurred and is continuing.
4.16Material Contracts and Material Indebtedness.  Schedule 4.16 contains a true, correct and complete list of all the Material Contracts in effect on the Closing Date, and, together with any updates provided pursuant to Section 5.1(l), (a) all such Material Contracts are in full force and effect and (b) each such Material Contract has not been amended, waived, or otherwise modified except as permitted under this Agreement.  As of the Closing Date, true, correct and complete copies of all Material Contracts listed on Schedule 4.16 have been delivered to the Purchaser. Schedule 4.16 contains a true, correct and complete list of all Material Indebtedness (other than Obligations) of any one or more of Company and its Subsidiaries with an individual outstanding principal amount (or Swap Termination Value) of $500,000 or more.
4.17Governmental Regulation.  Neither Company nor any of its Subsidiaries is subject to regulation under the Federal Power Act or the Investment Company Act of 1940 or under any other federal or state statute or regulation that may limit its ability to incur Indebtedness or that may otherwise render all or any portion of the Obligations unenforceable.  Neither Company nor any of its Subsidiaries is a “registered investment company” or a company “controlled” by a “registered investment company” or a “principal underwriter” of a “registered investment company” as such terms are defined in the Investment Company Act of 1940.
4.18Federal Reserve Regulations; Exchange Act.
(a)Neither Company nor any of its Subsidiaries is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock.
(b)No portion of the proceeds of issuance and sale of DIP Notes has or will be used in any manner, whether directly or indirectly, that causes or could reasonably be expected to cause, such issuance and sale of DIP Notes or the application of such proceeds to violate Regulation T, Regulation U or Regulation X of the Board of Governors or any other regulation thereof or to violate the Exchange Act.
4.19Employee Matters.  Neither Company nor any of its Subsidiaries is engaged in any unfair labor practice that could reasonably be expected to result in a Material Adverse Effect.  There is (a) no unfair labor practice complaint pending against Company or any of its Subsidiaries, or to the best knowledge of Company, threatened against any of them before the National Labor Relations Board and no grievance or arbitration proceeding arising out of or under any collective bargaining agreement that is so pending against Company or any of its Subsidiaries or to the best knowledge of Company, threatened against any of them, (b) no strike or work stoppage in

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existence or threatened involving Company or any of its Subsidiaries,  and (c) to the best knowledge of Company, no union representation question existing with respect to the employees of Company or any of its Subsidiaries and, to the best knowledge of Company, no union organization activity that is taking place, except (with respect to any matter specified in clause (a), (b) or (c) above, either individually or in the aggregate) such as is not reasonably likely to have a Material Adverse Effect.  No DIP Note Party has incurred any liability or obligation under the Worker Adjustment and Retraining Notification Act (“WARN”) or any similar federal or state law that remains unpaid or unsatisfied and could reasonably be expected to result in a Material Adverse Effect.

4.20Employee Benefit Plans.  Except as, either individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect, Company, each of its Subsidiaries and each of their respective ERISA Affiliates are in compliance with all applicable provisions and requirements of ERISA and the Code and the regulations and published interpretations thereunder with respect to each Employee Benefit Plan, and have performed all their obligations under each Employee Benefit Plan.  Each Employee Benefit Plan that is intended to qualify under Section 401(a) of the Code has received a favorable determination letter from the Internal Revenue Service indicating that such Employee Benefit Plan is so qualified and nothing has occurred subsequent to the issuance of such determination letter that would cause such Employee Benefit Plan to lose its qualified status.  No liability to the PBGC (other than required premium payments), the Internal Revenue Service, any Employee Benefit Plan or any trust established under Title IV of ERISA has been or is expected to be incurred by Company, any of its Subsidiaries or any of their ERISA Affiliates.  No ERISA Event has occurred or is reasonably expected to occur.  Except to the extent required under Section 4980B of the Code or similar state laws, no Employee Benefit Plan provides health or welfare benefits (through the purchase of insurance or otherwise) for any retired or former employee of Company, any of its Subsidiaries or any of their respective ERISA Affiliates.  The present value of the aggregate benefit liabilities under each Pension Plan sponsored, maintained or contributed to by Company, any of its Subsidiaries or any of their ERISA Affiliates (determined as of the end of the most recent plan year on the basis of the actuarial assumptions specified for funding purposes in the most recent actuarial valuation for such Pension Plan), did not exceed the aggregate current value of the assets of such Pension Plan.  As of the most recent valuation date for each Multiemployer Plan for which the actuarial report is available, the potential liability of Company, its Subsidiaries and their respective ERISA Affiliates for a complete withdrawal from such Multiemployer Plan (within the meaning of Section 4203 of ERISA), when aggregated with such potential liability for a complete withdrawal from all Multiemployer Plans, based on information available pursuant to Section 4221(e) of ERISA is zero.  Company, each of its Subsidiaries and each of their ERISA Affiliates have complied with the requirements of Section 515 of ERISA with respect to each Multiemployer Plan and are not in material “default” (as defined in Section 4219(c)(5) of ERISA) with respect to payments to a Multiemployer Plan.
4.21Certain Fees.  No broker’s or finder’s fee or commission will be payable with respect to the transactions contemplated by this Agreement, except as payable to Collateral Agent and Purchaser.
4.22Plan Assets; Prohibited Transactions. No DIP Note Party is an entity deemed to hold “plan assets” within the meaning of Section 3(42) of ERISA.  The execution and delivery of this Agreement and any other DIP Note Document will not involve any transaction that is subject

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to the prohibitions of Section 406 of ERISA or in connection with which a tax could be imposed pursuant to Sections 4975(c)(1)(A)-(D) of the Internal Revenue Code.
4.23Pre-Petition Secured Agreements. The DIP Note Parties acknowledge and agree (a) that the Pre-Petition Note Purchase Agreement is valid and enforceable and (b) subject to the terms of the Orders and the Liens hereunder or any Order, the Replacement Liens, the Carve-Out and the Permitted Priority Liens (other than the Primed Liens), the Collateral Agent for the benefit of the Pre-Petition Purchasers has a valid, enforceable and fully perfected first priority Lien in all of the “Collateral” described under the Pre-Petition Note Purchase Agreement and all proceeds thereof.
4.24Compliance with Statutes, Etc.  Each of Company and its Subsidiaries is in compliance in all material respects with all applicable statutes, regulations and orders of, and all applicable restrictions imposed by, all Governmental Authorities, in respect of the conduct of its business and the ownership of its property, including compliance with all applicable Environmental Laws with respect to any Real Estate Asset or governing its business and the requirements of any permits issued under such Environmental Laws with respect to any such Real Estate Asset or the operations of Company or any of its Subsidiaries (it being understood, in the case of any statutes, regulations and orders of, and all applicable restrictions imposed by, all Governmental Authorities that are specifically referred to in any other provision of this Agreement, the DIP Note Parties shall also be required to represent and/or comply with, as applicable, the express terms of such provision).  Each DIP Note Party possesses all franchises, licenses and permits, patents, copyrights, trademarks and trade names, and rights in respect of the foregoing, material and necessary to the conduct of its business without known conflict with any rights of others. Without limiting the foregoing, on or prior to the Closing Date, Company has made all filings with the Securities and Exchange Commission required under the Securities Act, Exchange Act or the rules and regulations thereunder with respect to transactions contemplated by this Agreement to have occurred on or prior to the Closing Date, in each case, on or prior to the date required thereunder (without giving effect to any extension or possible extension of such dates permitted thereunder).
4.25Disclosure.  Other than with respect to projections, estimates and other forward looking information and general economic and industry information, no representation or warranty of any DIP Note Party contained in any DIP Note Document or in any other documents, certificates or written statements furnished to Collateral Agent or Purchaser by or on behalf of Company or any of its Subsidiaries for use in connection with the transactions contemplated hereby contains any untrue statement of a material fact or omits to state a material fact (known to Company, in the case of any document not furnished by either of them) necessary in order to make the statements contained herein or therein not misleading in light of the circumstances in which the same were made.  Any projections and pro forma financial information contained in such materials are based upon good faith estimates and assumptions believed by Company to be reasonable at the time made, it being recognized by Purchaser that such projections as to future events are not to be viewed as facts and that actual results during the period or periods covered by any such projections may differ from the projected results.  There are no facts known (or that should upon the reasonable exercise of diligence be known) to Company (other than matters of a general economic nature) that, individually or in the aggregate, could reasonably be expected to result in a Material Adverse

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Effect and that have not been disclosed herein or in such other documents, certificates and statements furnished to Purchaser for use in connection with the transactions contemplated hereby.
4.26Sanctions; Anti-Corruption and Anti-Bribery Laws; Anti-Terrorism and Anti-Money Laundering Laws; Etc.
(a)None of the DIP Note Parties, any of their Subsidiaries, any Affiliate of any such Person, or any of their respective Directors, officers or, to the knowledge of any DIP Note Party, employees, agents, advisors or other Affiliates is a Sanctioned Person.  Each DIP Note Party and its Subsidiaries and their respective Directors, officers and, to the knowledge of any DIP Note Party, employees, agents, advisors and Affiliates is in compliance with and has not violated (i)  Sanctions, (ii) Anti-Corruption and Anti-Bribery Laws, and (iii)  Anti-Terrorism and Anti-Money Laundering Laws.  No part of the proceeds of any issuance and sale of DIP Notes has or will be used, directly or indirectly, (A) to finance or facilitate any activities or business of with or relating to any Sanctioned Person or in any Sanctioned Country, (B) in furtherance of an offer, payment, promise to pay, or authorization of the payment or giving of money, or anything else of value to any Person in violation of any Anti-Corruption and Anti-Bribery Laws, or (C) otherwise in any manner that would result in a violation of Sanctions, Anti-Terrorism and Anti-Money Laundering Laws, or Anti-Corruption and Anti-Bribery Laws by any Person.
(b)Company and its Subsidiaries have established and currently maintain policies, procedures and controls that are reasonably designed (and otherwise comply with applicable law) to ensure that each of Company, its Subsidiaries, and each Controlled Entity, and each of their respective Directors, officers, employees and agents, is and will continue to be in compliance with all applicable current and future Sanctions, Anti-Terrorism and Anti-Money Laundering Laws, and Anti-Corruption and Anti-Bribery Laws.
4.27Private Offering.  Subject to the accuracy of the representations and warranties of the Purchaser, the offer, sale, issuance and delivery of the DIP Notes in accordance with the terms herein will be exempt from the registration provisions of the Securities Act and the registration requirements of any securities or blue sky laws of any applicable jurisdiction.
4.28Chapter 11 Case Matters.
(a)(i) The Chapter 11 Cases were commenced on the Petition Date in accordance with applicable law and proper notice thereof has been given, (ii) proper notice for the hearing for the approval of the Interim Order has been given, and (iii) proper notice for the hearing for the approval of the Final Order will be (or after the entry of the Final Order, has been) given.
(b)After the entry of the Interim Order, and pursuant to and to the extent permitted in the Interim Order and the Final Order, the Obligations will constitute allowed administrative expense claims in the Chapter 11 Cases having the priority set forth in the Orders.
(c)After the entry of the Interim Order and the execution of the Collateral Documents, the Obligations will be secured by a valid and perfected, enforceable and unavoidable first priority, priming Lien with priority over the Liens of the Pre-Petition Note Purchase Agent on all of the Collateral and the proceeds thereof to the extent provided and as more fully set forth in the Orders and the Collateral Documents.

EXHIBIT 99.1

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

In re:

CAPSTONE GREEN ENERGY CORPORATION, et al.,

Debtors.1

:

:

:

:

:

:

:

:

Chapter 11

Case No. 23-11634 (LSS)

(Jointly Administered)

:

Re: Docket No. 12

INTERIM ORDER (I) APPROVING NOTIFICATION AND

HEARING PROCEDURES FOR CERTAIN TRANSFERS

OF COMMON STOCK AND (II) GRANTING RELATED RELIEF

Upon the motion (the “Motion”)2 of the above-captioned debtors and debtors in possession (collectively, the “Debtors”) for entry of an interim order (this “Interim Order”), (i) authorizing and approving the Procedures related to transfers of Beneficial Ownership of Common Stock, (ii) directing that any purchase, sale, or other transfer of Beneficial Ownership of Common Stock in violation of the Procedures shall be null and void ab initio, and (iii) granting related relief, all as more fully set forth in the Motion; and upon the First Day Declaration; and this Court having jurisdiction over this matter pursuant to 28 U.S.C. §§ 157 and 1334 and the Amended Standing Order; and this Court having found that this is a core proceeding pursuant to 28 U.S.C. § 157(b)(2); and this Court having found that venue of this proceeding and the Motion in this district is proper pursuant to 28 U.S.C. §§ 1408 and 1409; and this Court having found that the relief requested in the Motion is in the best interests of the Debtors’ estates, their creditors, and other parties in interest; and this Court having found that the Debtors’ notice of the Motion and opportunity for a

1  

The Debtors in these Chapter 11 Cases, along with the last four digits of each Debtor’s federal tax identification number are: Capstone Green Energy Corporation (0883); Capstone Turbine International, Inc. (4270); and Capstone Turbine Financial Services, LLC (N/A).  The Debtors’ mailing address is 16640 Stagg Street, Van Nuys, California 91406.

2

Capitalized terms used but not otherwise defined herein have the meanings ascribed to them in the Motion.


hearing on the Motion were appropriate under the circumstances and no other notice need be provided; and this Court having reviewed the Motion and having heard the statements in support of the relief requested therein at a hearing before this Court, if any (the “Hearing”); and this Court having determined that the legal and factual bases set forth in the Motion and at the Hearing establish just cause for the relief granted herein; and upon all of the proceedings had before this Court; and after due deliberation and sufficient cause appearing therefore, it is

HEREBY ORDERED THAT:

1.The Motion is granted on an interim basis as set forth in this Interim Order.
2.The final hearing (the “Final Hearing”) on the Motion shall be held on November 7, 2023, at 10:00 a.m., prevailing Eastern Time.  Any objections or responses to entry of a final order on the Motion shall be filed on or before 4:00 p.m., prevailing Eastern Time, on October 31, 2023 and shall be served on: (a) proposed counsel for the Debtors, (i) Katten Muchin Rosenman LLP, 525 W. Monroe Street, Chicago, IL 60661, Attn: Peter A. Siddiqui, Esq. (peter.siddiqui@katten.com) and Ethan D. Trotz, Esq. (ethan.trotz@katten.com) and (ii) Young Conaway Stargatt & Taylor, LLP, Rodney Square, 1000 North King Street, Wilmington, DE 19801, Attn: Matthew B. Lunn, Esq. (mlunn@ycst.com) and Shane M. Reil, Esq. (sreil@ycst.com); (b) counsel for the NPA Collateral Agent, Pre-Petition Secured Parties, and proposed DIP Purchaser, Cleary Gottlieb Steen & Hamilton LLP, One Liberty Plaza, New York, NY 10006, Attn: Sean O’Neal (soneal@cgsh.com); (c) any statutory committee appointed in these Chapter 11 Cases; and (d) the Office of the United States Trustee for the District of Delaware, 844 King Street Suite 2207, Lockbox 35, Wilmington, DE 19801, Attn: Linda Casey (Linda.Casey@usdoj.gov).  In the event no objections to entry of a final order on the Motion are timely received, this Court may enter such final order without need for the Final Hearing.

2


3.The Procedures, as set forth in Exhibit 1 attached hereto, are hereby approved; provided, however, that any party in interest may file a motion and seek emergency relief from the Procedures based upon a showing of sufficient cause; provided further that the Debtors’ and the other Notice Parties’ rights to oppose such relief are fully reserved and preserved.
4.Any transfer of Beneficial Ownership of Common Stock in violation of the Procedures, including but not limited to the notice requirements, shall be null and void ab initio.
5.The Debtors shall post the Procedures to the website established by Kroll Restructuring Administration LLC for these Chapter 11 Cases (https://cases.ra.kroll.com/capstone).
6.The requirements set forth in this Interim Order are in addition to the requirements of applicable law and do not excuse compliance therewith.
7.Nothing contained in the Motion or this Interim Order, and no action taken pursuant to the relief requested or granted, is intended as or shall be construed or deemed to be:  (a) an admission as to the amount of, basis for, or validity of any claim against the Debtors under the Bankruptcy Code or other applicable nonbankruptcy law; (b) a waiver of the Debtors’ or any other party in interest’s right to dispute any claim on any grounds; (c) a promise or requirement to pay any particular claim; (d) an implication, admission or finding that any particular claim is an administrative expense claim, other priority claim or otherwise of a type specified or defined in the Motion or this Interim Order; (e) a request or authorization to assume, adopt, or reject any agreement, contract, or lease pursuant to section 365 of the Bankruptcy Code; (f) an admission as to the validity, priority, enforceability or perfection of any lien on, security interest in, or other encumbrance on property of the Debtors’ estates; or (g) a waiver or limitation of any claims, causes

3


of action or other rights of the Debtors or any other party in interest against any person or entity under the Bankruptcy Code or any other applicable law.
8.The Debtors have demonstrated that the requested relief is “necessary to avoid immediate and irreparable harm,” as contemplated by Bankruptcy Rule 6003.
9.Other than to the extent that this Interim Order expressly conditions or restricts trading in Common Stock, nothing in this Interim Order or in the Motion shall, or shall be deemed to, prejudice, impair, or otherwise alter or affect the rights of any holders of Common Stock, including in connection with the treatment of any such stock under any chapter 11 plan or any applicable bankruptcy court order.
10.Notice of the Motion as provided therein shall be deemed good and sufficient notice of such Motion and the requirements of Bankruptcy Rule 6004(a) and the Local Rules are satisfied by such notice.
11.Notwithstanding Bankruptcy Rule 6004(h), the terms and conditions of this Interim Order are immediately effective and enforceable upon its entry.
12.The Debtors are authorized to take all actions necessary to effectuate the relief granted in this Interim Order in accordance with the Motion.
13.This Court retains exclusive jurisdiction with respect to all matters arising from or related to the implementation, interpretation, and enforcement of this Interim Order.

4


Exhibit 1

Procedures for Transfers of Beneficial Ownership of Common Stock


PROCEDURES FOR TRANSFERS OF COMMON STOCK1

The following procedures apply to transfers of Debtor Capstone Green Energy Corporation’s existing class of common stock or any Beneficial Ownership2 therein (collectively, the “Common Stock”):

a.Procedures for Transfers of Common Stock
i.Any entity (as defined in section 101(15) of the Bankruptcy Code, an “Entity”) that is a Substantial Shareholder (as defined herein) must file with the Court, and serve upon:  (a) proposed counsel for the Debtors, (i) Katten Muchin Rosenman LLP, 525 W. Monroe Street, Chicago, IL 60661, Attn: Peter A. Siddiqui, Esq. (peter.siddiqui@katten.com) and Ethan D. Trotz, Esq. (ethan.trotz@katten.com) and (ii) Young Conaway Stargatt & Taylor, LLP, Rodney Square, 1000 North King Street, Wilmington, DE 19801, Attn: Matthew B. Lunn, Esq. (mlunn@ycst.com); (b) counsel for the NPA Collateral Agent, Pre-Petition Secured Parties, and proposed DIP Purchaser, Cleary Gottlieb Steen & Hamilton LLP, One Liberty Plaza, New York, NY 10006, Attn: Sean O’Neal (soneal@cgsh.com); (c) any statutory committee appointed in these Chapter 11 Cases; and (d) the Office of the United States Trustee for the District of Delaware, 844 King Street Suite 2207, Lockbox 35, Wilmington, DE 19801, Attn: Linda Casey (Linda.Casey@usdoj.gov) (collectively, the “Notice Parties”), a declaration of such status, substantially in the form attached to the Procedures as Exhibit 1A (each, a “Declaration  of Status as a Substantial Shareholder”), on or before the later of (A) twenty (20) calendar days after the date of the Notice of Interim Order, or (B) ten (10) calendar days after becoming a Substantial Shareholder; provided that, for the avoidance of doubt, the other procedures set forth herein shall apply to any Substantial Shareholder even if no Declaration of Status as a Substantial Shareholder has been filed.

1

Capitalized terms used but not otherwise defined herein have the meanings given to them in the Motion.

2

Beneficial Ownership” will be determined in accordance with the applicable rules of sections 382 and 383 of the Internal Revenue Code of 1986, 26 U.S.C. §§ 1–9834 as amended (the “IRC”) and the U.S. Department of the Treasury regulations thereunder (“Treasury Regulations”) (other than Treasury Regulations section 1.382-2T(h)(2)(i)(A)), and includes direct, indirect, and constructive ownership (e.g., (1) a holding company would be considered to beneficially own all equity securities owned by its subsidiaries, (2) a partner in a partnership would be considered to beneficially own its proportionate share of any equity securities owned by such partnership, (3) an individual and such individual’s family members may be treated as one individual, (4) persons and entities acting in concert to make a coordinated acquisition of equity securities may be treated as a single entity, and (5) a holder would be considered to beneficially own equity securities that such holder has an Option to acquire).  An “Option” to acquire stock includes all interests described in Treasury Regulations section 1.382-4(d)(9), including any contingent purchase right, warrant, convertible debt, put, call, stock subject to risk of forfeiture, contract to acquire stock, or similar interest, regardless of whether it is contingent or otherwise not currently exercisable; provided that an Option shall not include the Pre-Petition Warrants (as defined in the Plan).


ii.Prior to effectuating any transfer of Beneficial Ownership of Common Stock that would result in an increase in the amount of Common Stock of which a Substantial Shareholder has Beneficial Ownership or would result in an Entity or individual becoming a Substantial Shareholder, the parties to such transaction must file with the Court, and serve upon the Notice Parties, an advance written declaration of the intended transfer of Common Stock, substantially in the form attached to the Procedures as Exhibit 1B (each, a “Declaration of Intent to Accumulate Common Stock”).
iii.Prior to effectuating any transfer of Beneficial Ownership of Common Stock that would result in a decrease in the amount of Common Stock of which a Substantial Shareholder has Beneficial Ownership or would result in an Entity or individual ceasing to be a Substantial Shareholder, the parties to such transaction must file with the Court, and serve upon the Notice Parties, an advance written declaration of the intended transfer of Common Stock, substantially in the form attached to the Procedures as Exhibit 1C (each, a “Declaration of Intent to Transfer Common Stock”, and together with a Declaration of Intent to Accumulate Common Stock, each, a “Declaration of Proposed Transfer”).
iv.The Debtors and the other Notice Parties shall have five (5) calendar days after receipt of a Declaration of Proposed Transfer to file with the Court and serve on such Substantial Shareholder or potential Substantial Shareholder an objection to any proposed transfer of Beneficial Ownership of Common Stock described in the Declaration of Proposed Transfer on the grounds that such transfer might adversely affect the Debtors’ ability to utilize their Tax Attributes. If the Debtors or any of the other Notice Parties file an objection, such transaction will remain ineffective unless such objection is withdrawn, or such transaction is approved by a final and non-appealable order of the Court.  If the Debtors and the other Notice Parties do not object within such five-day period, such transaction can proceed solely as set forth in the Declaration of Proposed Transfer.  Further transactions within the scope of this paragraph must be the subject of additional notices in accordance with the procedures set forth herein, with an additional five-day waiting period for each Declaration of Proposed Transfer.  To the extent that the Debtors receive an appropriate Declaration of Proposed Transfer and determine in their business judgment not to object, they shall provide notice of that decision as soon as is reasonably practicable to any statutory committee(s) appointed in these Chapter 11 Cases.
v.For purposes of these Procedures:  (i) a “Substantial Shareholder” is any Entity or individual person that has Beneficial Ownership of at least 832,500 shares of Common Stock (representing approximately 4.5 percent of all issued and outstanding shares of Common Stock); and (ii) “Beneficial Ownership” will be determined in accordance with the applicable rules of section 382 of the IRC, and the Treasury Regulations promulgated thereunder (other than Treasury Regulations section 1.382-2T(h)(2)(i)(A))

2


and includes direct, indirect, and constructive ownership (e.g., (1) a holding company would be considered to beneficially own all equity securities owned by its subsidiaries, (2) a partner in a partnership would be considered to beneficially own its proportionate share of any equity securities owned by such partnership, (3) an individual and such individual’s family members may be treated as one individual, (4) persons and entities acting in concert to make a coordinated acquisition of equity securities may be treated as a single Entity, and (5) a holder would be considered to beneficially own equity securities that such holder has an Option (as defined herein) to acquire).  An “Option” to acquire stock includes all interests described in Treasury Regulations section 1.382-4(d)(9), including any contingent purchase right, warrant, convertible debt, put, call, stock subject to risk of forfeiture, contract to acquire stock, or similar interest, regardless of whether it is contingent or otherwise not currently exercisable; provided that an Option shall not include the Pre-Petition Warrants (as defined in the Plan).
b.Notice Procedures
i.No later than October 2, 2023 the Debtors shall serve a notice by first class mail or overnight mail, postage prepaid, substantially in the form attached to the Procedures as Exhibit 1D (the “Notice of Interim Order”), on:  (i) the U.S. Trustee for the District of Delaware; (ii) the entities listed on the consolidated list of creditors holding the thirty (30) largest unsecured claims; (iii) the U.S. Securities and Exchange Commission; (iv) the Internal Revenue Service; (v) any official committees appointed in these Chapter 11 Cases; and (vi) each equity security holder directly registered with the transfer agent for the Debtors’ Common Stock and all banks, brokers, intermediaries, other nominees or their mailing agents (collectively, “Nominees”) that hold the Common Stock in “street name” for the beneficial holders (with instructions to serve down to the beneficial holders of Common Stock, as applicable).  Additionally, no later than three (3) business days following entry of the Final Order, or as soon as reasonably practicable thereafter, the Debtors shall serve a Notice of Interim Order modified to reflect that the Final Order has been entered (as modified, the “Notice of Final Order”) on the same entities that received the Notice of Interim Order.
ii.All registered holders of Common Stock and Nominees that hold the Common Stock in “street name” shall be required to serve the Notice of Interim Order or Notice of Final Order, as applicable, on any holder for whose benefit such registered or nominee holder holds such Common Stock, down the chain of ownership for all such holders of Common Stock.
iii.Any Entity or individual, or broker or agent acting on such Entity’s or individual’s behalf who sells Common Stock to another Entity or individual, shall be required to serve a copy of the Notice of Interim Order

3


or Notice of Final Order, as applicable, on such purchaser of such Common Stock, or any broker or agent acting on such purchaser’s behalf.
iv.To the extent confidential information is required in any declaration described in the Procedures, such confidential information may be filed and served in redacted form pending a motion seeking to file such information in redacted form; provided, however, that any such declarations served on the Debtors shall not be in redacted form.  The Debtors shall keep all information provided in such declarations strictly confidential and shall not disclose the contents thereof to any person except:  (i) to the extent necessary to respond to a petition or objection filed with the Court; (ii) to the extent otherwise required by law; or (iii) to the extent that the information contained therein is already public; provided, however, that the Debtors may disclose the contents thereof to their professional advisors, who shall keep all such notices strictly confidential and shall not disclose the contents thereof to any other person, subject to further Court order.  To the extent confidential information is necessary to respond to a petition or objection filed with the Court, such confidential information shall be filed under seal or in a redacted form pending a motion seeking to file such information under seal or in redacted form.

4


Exhibit 1A

Declaration of Status as a Substantial Shareholder


IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

In re:

CAPSTONE GREEN ENERGY CORPORATION, et al.,

Debtors.1

:

:

:

:

:

:

:

Chapter 11

Case No. 23-11634 (LSS)

(Jointly Administered)

:

Re: Docket No. __

DECLARATION OF STATUS AS A SUBSTANTIAL SHAREHOLDER2

PLEASE TAKE NOTICE that the undersigned party is/has become a Substantial Shareholder with respect to the existing classes of common stock or any Beneficial Ownership therein (any such record or Beneficial Ownership of common stock, collectively, the “Common Stock”) of Capstone Green Energy Corporation, a debtor and debtor in possession in Case No. 23-11634 (LSS) pending in the United States Bankruptcy Court for the District of Delaware (the “Court”).

PLEASE TAKE FURTHER NOTICE that, as of ______________ ___, 2023, the undersigned party currently has Beneficial Ownership of ____________ shares of Common Stock.  

1

The Debtors in these Chapter 11 Cases, along with the last four digits of each Debtor’s federal tax identification number are: Capstone Green Energy Corporation (0883); Capstone Turbine International, Inc. (4270); and Capstone Turbine Financial Services, LLC (N/A).  The Debtors’ mailing address is 16640 Stagg Street, Van Nuys, California 91406.

2

For purposes of these Procedures: (i) a “Substantial Shareholder” is any entity or individual that has Beneficial Ownership of at least 832,500 shares of Common Stock (representing approximately 4.5 percent of issued and outstanding shares of Common Stock); and (ii) “Beneficial Ownership” will be determined in accordance with the applicable rules of sections 382 and 383 of the Internal Revenue Code of 1986, 26 U.S.C. §§ 1–9834 as amended (the “IRC”), and the Treasury Regulations thereunder (other than Treasury Regulations section 1.382-2T(h)(2)(i)(A)), and includes direct, indirect, and constructive ownership (e.g., (1) a holding company would be considered to beneficially own all equity securities owned by its subsidiaries, (2) a partner in a partnership would be considered to beneficially own its proportionate share of any equity securities owned by such partnership, (3) an individual and such individual’s family members may be treated as one individual, (4) persons and entities acting in concert to make a coordinated acquisition of equity securities may be treated as a single entity, and (5) a holder would be considered to beneficially own equity securities that such holder has an Option to acquire).  An “Option” to acquire stock includes all interests described in Treasury Regulations section 1.382-4(d)(9), including any contingent purchase right, warrant, convertible debt, put, call, stock subject to risk of forfeiture, contract to acquire stock, or similar interest, regardless of whether it is contingent or otherwise not currently exercisable; provided that an Option shall not include the Pre-Petition Warrants (as defined in the Plan).


The following table sets forth the date(s) on which the undersigned party acquired Beneficial Ownership of such Common Stock:

Number of Shares of
Common Stock

Date Acquired

(Attach additional page or pages if necessary)

PLEASE TAKE FURTHER NOTICE that the last four digits of the taxpayer identification number of the undersigned party are _____________.

PLEASE TAKE FURTHER NOTICE that, pursuant to that certain Interim Order (I) Approving Notification and Hearing Procedures for Certain Transfers of Common Stock and (II) Granting Related Relief [Docket No.__] (the “Order”), this declaration (this “Declaration”) is being filed with the Court and served upon the Notice Parties (as defined in the Order).

PLEASE TAKE FURTHER NOTICE that, at the election of the Substantial Shareholder, the Declaration to be filed with this Court (but not the Declaration that is served upon the Notice Parties) may be redacted to exclude the Substantial Shareholder’s taxpayer identification number and the amount of Common Stock that the Substantial Shareholder beneficially owns.

PLEASE TAKE FURTHER NOTICE that, pursuant to 28 U.S.C. § 1746, under penalties of perjury, the undersigned party hereby declares that he or she has examined this

2


Declaration and accompanying attachments (if any), and, to the best of his or her knowledge and belief, this Declaration and any attachments hereto are true, correct, and complete.

Respectfully submitted,

(Name of Substantial Shareholder)

By:

________________________________

Name: ___________________________________

Address: _________________________________

_________________________________________

Telephone: _______________________________

Facsimile: ________________________________

Dated:  ____________ __, 20__

______________, __________

(City)(State)

3


Exhibit 1B

Declaration of Intent to Accumulate Common Stock


IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

In re:

CAPSTONE GREEN ENERGY CORPORATION, et al.,

Debtors.1

:

:

:

:

:

:

:

Chapter 11

Case No. 23-11634 (LSS)

(Jointly Administered)

:

Re: Docket No. __

DECLARATION OF INTENT TO ACCUMULATE COMMON STOCK2

PLEASE TAKE NOTICE that the undersigned party hereby provides notice of its intention to purchase, acquire, or otherwise accumulate (the “Proposed Transfer”) one or more shares of the existing classes of common stock or any Beneficial Ownership therein (any such record or Beneficial Ownership of common stock, collectively, the “Common Stock”) of Capstone Green Energy Corporation, a debtor and debtor in possession in Case No. 23-11634 (LSS) pending in the United States Bankruptcy Court for the District of Delaware (the “Court”).

1

The Debtors in these Chapter 11 Cases, along with the last four digits of each Debtor’s federal tax identification number are: Capstone Green Energy Corporation (0883); Capstone Turbine International, Inc. (4270); and Capstone Turbine Financial Services, LLC (N/A).  The Debtors’ mailing address is 16640 Stagg Street, Van Nuys, California 91406.

2

For purposes of these Procedures: (i) a “Substantial Shareholder” is any entity or individual that has Beneficial Ownership of at least 832,500 shares of Common Stock (representing approximately 4.5 percent of issued and outstanding shares of Common Stock); and (ii) “Beneficial Ownership” will be determined in accordance with the applicable rules of sections 382 and 383 of the Internal Revenue Code of 1986, 26 U.S.C. §§ 1–9834 as amended (the “IRC”), and the Treasury Regulations thereunder (other than Treasury Regulations section 1.382-2T(h)(2)(i)(A)), and includes direct, indirect, and constructive ownership (e.g., (1) a holding company would be considered to beneficially own all equity securities owned by its subsidiaries, (2) a partner in a partnership would be considered to beneficially own its proportionate share of any equity securities owned by such partnership, (3) an individual and such individual’s family members may be treated as one individual, (4) persons and entities acting in concert to make a coordinated acquisition of equity securities may be treated as a single entity, and (5) a holder would be considered to beneficially own equity securities that such holder has an Option to acquire). An “Option” to acquire stock includes all interests described in Treasury Regulations section 1.382-4(d)(9), including any contingent purchase right, warrant, convertible debt, put, call, stock subject to risk of forfeiture, contract to acquire stock, or similar interest, regardless of whether it is contingent or otherwise not currently exercisable; provided that an Option shall not include the Pre-Petition Warrants (as defined in the Plan).


PLEASE TAKE FURTHER NOTICE that, if applicable, on _________ __, 2023, the undersigned party filed a Declaration of Status as a Substantial Shareholder with the Court and served copies thereof as set forth therein.

PLEASE TAKE FURTHER NOTICE that the undersigned party currently has Beneficial Ownership of _________ shares of Common Stock.

PLEASE TAKE FURTHER NOTICE that, pursuant to the Proposed Transfer, the undersigned party proposes to purchase, acquire, or otherwise accumulate Beneficial Ownership of ________ shares of Common Stock or an Option with respect to _________ shares of Common Stock.  If the Proposed Transfer is permitted to occur, the undersigned party will have Beneficial Ownership of _______ shares of Common Stock.

PLEASE TAKE FURTHER NOTICE that the last four digits of the taxpayer identification number of the undersigned party are _________.

PLEASE TAKE FURTHER NOTICE that, pursuant to that certain Interim Order (I) Approving Notification and Hearing Procedures for Certain Transfers of Common Stock and (II) Granting Related Relief [Docket No. __] (the “Order”), this declaration (this “Declaration”) is being filed with the Court and served upon the Notice Parties (as defined in the Order).

PLEASE TAKE FURTHER NOTICE that, at the election of the undersigned party, the Declaration to be filed with this Court (but not the Declaration that is served upon the Notice Parties) may be redacted to exclude the undersigned party’s taxpayer identification number and the amount of Common Stock that the undersigned party beneficially owns.

PLEASE TAKE FURTHER NOTICE that, pursuant to the Order, the undersigned party acknowledges that it is prohibited from consummating the Proposed Transfer unless and until the undersigned party complies with the Procedures set forth therein.

2


PLEASE TAKE FURTHER NOTICE that the Debtors and the other Notice Parties have five (5) calendar days after receipt of this Declaration to object to the Proposed Transfer described herein.  If the Debtors or any of the other Notice Parties file an objection, such Proposed Transfer will remain ineffective unless such objection is withdrawn or such transaction is approved by a final and non-appealable order of the Court.  If the Debtors and the other Notice Parties do not object within such five-day period, then after expiration of such period the Proposed Transfer may proceed solely as set forth in this Declaration.

PLEASE TAKE FURTHER NOTICE that any further transactions contemplated by the undersigned party that may result in the undersigned party purchasing, acquiring, or otherwise accumulating Beneficial Ownership of additional shares of Common Stock will each require an additional notice filed with the Court to be served in the same manner as this Declaration.

PLEASE TAKE FURTHER NOTICE that, pursuant to 28 U.S.C. § 1746, under penalties of perjury, the undersigned party hereby declares that he or she has examined this Declaration and accompanying attachments (if any), and, to the best of his or her knowledge and belief, this Declaration and any attachments hereto are true, correct, and complete.

Respectfully submitted,

(Name of Substantial Shareholder)

By:

________________________________

Name: ___________________________________

Address: _________________________________

_________________________________________

Telephone: _______________________________

Facsimile: ________________________________

Dated:  ____________ __, 20__

______________, __________

(City)(State)

3


Exhibit 1C

Declaration of Intent to Transfer Common Stock


IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

In re:

CAPSTONE GREEN ENERGY CORPORATION, et al.,

Debtors.1

:

:

:

:

:

:

:

Chapter 11

Case No. 23-11634 (LSS)

(Jointly Administered)

:

Re: Docket No. __

DECLARATION OF INTENT TO TRANSFER COMMON STOCK2

PLEASE TAKE NOTICE that the undersigned party hereby provides notice of its intention to sell, trade, or otherwise transfer (the “Proposed Transfer”) one or more shares of the existing classes of common stock or any Beneficial Ownership therein (any such record or Beneficial Ownership of common stock, collectively, the “Common Stock”) of Capstone Green Energy Corporation, a debtor and debtor in possession in Case No. 23-11634 (LSS) pending in the United States Bankruptcy Court for the District of Delaware (the “Court”).

1

The Debtors in these Chapter 11 Cases, along with the last four digits of each Debtor’s federal tax identification number are: Capstone Green Energy Corporation (0883); Capstone Turbine International, Inc. (4270); and Capstone Turbine Financial Services, LLC (N/A).  The Debtors’ mailing address is 16640 Stagg Street, Van Nuys, California 91406.

2

For purposes of these Procedures: (i) a “Substantial Shareholder” is any entity or individual that has Beneficial Ownership of at least 832,500 shares of Common Stock (representing approximately 4.5 percent of issued and outstanding shares of Common Stock); and (ii) “Beneficial Ownership” will be determined in accordance with the applicable rules of sections 382 and 383 of the Internal Revenue Code of 1986, 26 U.S.C. §§ 1–9834 as amended (the “IRC”), and the Treasury Regulations thereunder (other than Treasury Regulations section 1.382-2T(h)(2)(i)(A)), and includes direct, indirect, and constructive ownership (e.g., (1) a holding company would be considered to beneficially own all equity securities owned by its subsidiaries, (2) a partner in a partnership would be considered to beneficially own its proportionate share of any equity securities owned by such partnership, (3) an individual and such individual’s family members may be treated as one individual, (4) persons and entities acting in concert to make a coordinated acquisition of equity securities may be treated as a single entity, and (5) a holder would be considered to beneficially own equity securities that such holder has an Option to acquire). An “Option” to acquire stock includes all interests described in Treasury Regulations section 1.382-4(d)(9), including any contingent purchase right, warrant, convertible debt, put, call, stock subject to risk of forfeiture, contract to acquire stock, or similar interest, regardless of whether it is contingent or otherwise not currently exercisable; provided that an Option shall not include the Pre-Petition Warrants (as defined in the Plan).


PLEASE TAKE FURTHER NOTICE that, if applicable, on _________ __, 2023, the undersigned party filed a Declaration of Status as a Substantial Shareholder with the Court and served copies thereof as set forth therein.

PLEASE TAKE FURTHER NOTICE that the undersigned party currently has Beneficial Ownership of _________ shares of Common Stock.

PLEASE TAKE FURTHER NOTICE that, pursuant to the Proposed Transfer, the undersigned party proposes to sell, trade, or otherwise transfer Beneficial Ownership of ________ shares of Common Stock or an Option with respect to ________ shares of Common Stock.  If the Proposed Transfer is permitted to occur, the undersigned party will have Beneficial Ownership of ________ shares of Common Stock after such transfer becomes effective.

PLEASE TAKE FURTHER NOTICE that the last four digits of the taxpayer identification number of the undersigned party are ________.

PLEASE TAKE FURTHER NOTICE that, pursuant to that certain Interim Order (I) Approving Notification and Hearing Procedures for Certain Transfers of Common Stock and (II) Granting Related Relief [Docket No. __] (the “Order”), this declaration (this “Declaration”) is being filed with the Court and served upon the Notice Parties (as defined in the Order).

PLEASE TAKE FURTHER NOTICE that, at the election of the undersigned party, the Declaration to be filed with this Court (but not the Declaration that is served upon the Notice Parties) may be redacted to exclude the undersigned party’s taxpayer identification number and the amount of Common Stock that the undersigned party beneficially owns.

PLEASE TAKE FURTHER NOTICE that, pursuant to the Order, the undersigned party acknowledges that it is prohibited from consummating the Proposed Transfer unless and until the undersigned party complies with the Procedures set forth therein.

2


PLEASE TAKE FURTHER NOTICE that the Debtors and the other Notice Parties have five (5) calendar days after receipt of this Declaration to object to the Proposed Transfer described herein.  If the Debtors or any of the other Notice Parties file an objection, such Proposed Transfer will remain ineffective unless such objection is withdrawn or such transaction is approved by a final and non-appealable order of the Court.  If the Debtors and the other Notice Parties do not object within such five-day period, then after expiration of such period the Proposed Transfer may proceed solely as set forth in this Declaration.

PLEASE TAKE FURTHER NOTICE that any further transactions contemplated by the undersigned party that may result in the undersigned party selling, trading, or otherwise transferring Beneficial Ownership of additional shares of Common Stock will each require an additional notice filed with the Court to be served in the same manner as this Declaration.

PLEASE TAKE FURTHER NOTICE that, pursuant to 28 U.S.C. § 1746, under penalties of perjury, the undersigned party hereby declares that he or she has examined this Declaration and accompanying attachments (if any), and, to the best of his or her knowledge and belief, this Declaration and any attachments hereto are true, correct, and complete.

Respectfully submitted,

(Name of Substantial Shareholder)

By:

________________________________

Name: ___________________________________

Address: _________________________________

_________________________________________

Telephone: _______________________________

Facsimile: ________________________________

Dated:  ____________ __, 20__

______________, __________

(City)(State)

3


Exhibit 1D

Notice of Interim Order


IN THE UNITED STATES BANKRUPTCY COURT

FOR THE DISTRICT OF DELAWARE

In re:

CAPSTONE GREEN ENERGY CORPORATION, et al.,

Debtors.11

:

:

:

:

:

:

:

Chapter 11

Case No. 23-11634 (LSS)

(Jointly Administered)

:

Re: Docket No. __

NOTICE OF INTERIM ORDER (I) APPROVING

NOTIFICATION AND HEARING PROCEDURES FOR CERTAIN
TRANSFERS OF COMMON STOCK AND (II) GRANTING RELATED RELIEF

TO:  ALL ENTITIES (AS DEFINED BY SECTION 101(15) OF THE BANKRUPTCY CODE) THAT MAY HOLD BENEFICIAL OWNERSHIP OF THE EXISTING CLASSES OF COMMON STOCK (THE “COMMON STOCK”) OF CAPSTONE GREEN ENERGY CORPORATION:

PLEASE TAKE NOTICE that on September 28, 2023 (the “Petition Date”), the above-captioned debtors and debtors in possession (collectively, the “Debtors”), filed petitions with the United States Bankruptcy Court for the District of Delaware (the “Court”) under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”).  Subject to certain exceptions, section 362 of the Bankruptcy Code operates as a stay of any act to obtain possession of property of or from the Debtors’ estates or to exercise control over property of or from the Debtors’ estates.

PLEASE TAKE FURTHER NOTICE that on September 28, 2023, the Debtors filed the Motion of Debtors for Entry of Interim and Final Orders (I) Approving Notification and Hearing Procedures for Certain Transfers of Common Stock and (II) Granting Related Relief [Docket No. 12] (the “Motion”).

11  

The Debtors in these Chapter 11 Cases, along with the last four digits of each Debtor’s federal tax identification number are: Capstone Green Energy Corporation (0883); Capstone Turbine International, Inc. (4270); and Capstone Turbine Financial Services, LLC (N/A).  The Debtors’ mailing address is 16640 Stagg Street, Van Nuys, California 91406.


PLEASE TAKE FURTHER NOTICE that on September ___, 2023, the Court entered the Interim Order (I) Approving Notification and Hearing Procedures for Certain Transfers of Common Stock and (II) Granting Related Relief [Docket No. ___] (the “Interim Order”) approving procedures for certain transfers of Common Stock set forth in Exhibit 1 attached to the Interim Order (the “Procedures”).12

PLEASE TAKE FURTHER NOTICE that, pursuant to the Interim Order, a Substantial Shareholder may not consummate any purchase, sale, or other transfer of Common Stock or Beneficial Ownership of Common Stock in violation of the Procedures, and any such transaction in violation of the Procedures shall be null and void ab initio.

PLEASE TAKE FURTHER NOTICE that, pursuant to the Interim Order, the Procedures shall apply to the holding and transfers of Common Stock or any Beneficial Ownership therein by a Substantial Shareholder or someone who may become a Substantial Shareholder.

PLEASE TAKE FURTHER NOTICE that, pursuant to the Interim Order, upon the request of any entity, the proposed notice, claims, and solicitation agent for the Debtors, Kroll Restructuring Administration LLC, will provide a copy of the Interim Order and a form of each of the declarations required to be filed by the Procedures in a reasonable period of time.  Such declarations are also available via PACER on the Court’s website at https://ecf.deb.uscourts.gov/ for a fee, or free of charge by accessing the Debtors’ restructuring website at https://cases.ra.kroll.com/capstone.

PLEASE TAKE FURTHER NOTICE that the final hearing (the “Final Hearing”) on the Motion shall be held on November 7, 2023, at 10:00 a.m., prevailing Eastern Time.  Any objections or responses to entry of a final order on the Motion shall be filed on or before 4:00 p.m., prevailing

12

Capitalized terms used but not otherwise defined herein have the meanings given to them in the Interim Order or the Motion, as applicable.

3


Eastern Time, on the date that is seven (7) days prior to the final hearing, on October 31, 2023, and shall be served on:  (a) proposed counsel for the Debtors, (i) Katten Muchin Rosenman LLP, 525 W. Monroe Street, Chicago, IL 60661, Attn: Peter A. Siddiqui, Esq. (peter.siddiqui@katten.com) and Ethan D. Trotz, Esq. (ethan.trotz@katten.com) and (ii) Young Conaway Stargatt & Taylor, LLP, Rodney Square, 1000 North King Street, Wilmington, DE 19801, Attn: Matthew B. Lunn, Esq. (mlunn@ycst.com) and Shane M. Reil, Esq. (sreil@ycst.com); (b) counsel for the NPA Collateral Agent, Pre-Petition Secured Parties, and proposed DIP Purchaser, Cleary Gottlieb Steen & Hamilton LLP, One Liberty Plaza, New York, NY 10006, Attn: Sean O’Neal (soneal@cgsh.com); (c) any statutory committee appointed in these Chapter 11 Cases; and (d) the Office of the United States Trustee for the District of Delaware, 844 King Street Suite 2207, Lockbox 35, Wilmington, DE 19801, Attn: Linda Casey (Linda.Casey@usdoj.gov).  In the event no objections to entry of the Final Order on the Motion are timely received, the Court may enter such Final Order without need for the Final Hearing.

PLEASE TAKE FURTHER NOTICE that, pursuant to the Interim Order, failure to follow the procedures set forth in the Interim Order shall constitute a violation of, among other things, the automatic stay provisions of section 362 of the Bankruptcy Code.

PLEASE TAKE FURTHER NOTICE that nothing in the Interim Order shall preclude any person desirous of acquiring any Common Stock from requesting relief from the Interim Order from this Court, subject to the Debtors’ and the other Notice Parties’ rights to oppose such relief.

PLEASE TAKE FURTHER NOTICE that other than to the extent that the Interim Order expressly conditions or restricts trading in Common Stock, nothing in the Interim Order or in the Motion shall, or shall be deemed to, prejudice, impair, or otherwise alter or affect the rights of any

4


holders of Common Stock, including in connection with the treatment of any such stock under any chapter 11 plan or any applicable bankruptcy court order.

PLEASE TAKE FURTHER NOTICE that any prohibited purchase, sale, other transfer of Common Stock, beneficial ownership thereof, or option with respect thereto in violation of the Interim Order is prohibited and shall be null and void ab initio and may be subject to additional sanctions as this court may determine.

PLEASE TAKE FURTHER NOTICE that the requirements set forth in the Interim Order are in addition to the requirements of applicable law and do not excuse compliance therewith.

[Remainder of page left blank intentionally]

5


Dated:September [__], 2023

/s/

Wilmington, Delaware

YOUNG CONAWAY STARGATT & TAYLOR, LLP

Matthew B. Lunn (No. 4119)

Shane M. Reil (No. 6195)

Rodney Square

1000 North King Street

Wilmington, DE 19801

Telephone: (302) 571-6600

Facsimile: (302) 571-1253

Email: mlunn@ycst.com

sreil@ycst.com

-and-

KATTEN MUCHIN ROSENMAN LLP

Peter A. Siddiqui (pro hac vice pending)

Ethan D. Trotz (pro hac vice pending)

Kenneth N. Hebeisen (pro hac vice pending)

525 W. Monroe Street

Chicago, IL 60661

Telephone: (312) 902-5200

Facsimile: (312) 902-1061

Email: peter.siddiqui@katten.com

ethan.trotz@katten.com

ken.hebeisen@katten.com

Proposed Attorneys for the Debtors

and Debtors in Possession

6


v3.23.3
Document and Entity Information
Sep. 29, 2023
Document Information [Line Items]  
Document Type 8-K
Document Period End Date Sep. 29, 2023
Entity Registrant Name CAPSTONE GREEN ENERGY CORPORATION
Entity Incorporation, State or Country Code DE
Entity File Number 001-15957
Entity Tax Identification Number 95-4180883
Entity Address, Address Line One 16640 Stagg Street,
Entity Address, City or Town Van Nuys
Entity Address State Or Province CA
Entity Address, Postal Zip Code 91406
City Area Code 818
Local Phone Number 734-5300
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
Entity Central Index Key 0001009759
Amendment Flag false
Common Stock  
Document Information [Line Items]  
Title of 12(b) Security Common Stock, par value $.001 per share
Trading Symbol CGRN
Security Exchange Name NASDAQ
Series B Junior Participating Preferred Stock  
Document Information [Line Items]  
Title of 12(b) Security Series B Junior Participating Preferred Stock Purchase Rights
No Trading Symbol Flag true

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